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Proc-Type: 2001,MIC-CLEAR
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<SEC-DOCUMENT>0000950114-01-500019.txt : 20010330
<SEC-HEADER>0000950114-01-500019.hdr.sgml : 20010330
ACCESSION NUMBER: 0000950114-01-500019
CONFORMED SUBMISSION TYPE: 10-K
PUBLIC DOCUMENT COUNT: 8
CONFORMED PERIOD OF REPORT: 20001231
FILED AS OF DATE: 20010329
FILER:
COMPANY DATA:
COMPANY CONFORMED NAME: ANHEUSER BUSCH COMPANIES INC
CENTRAL INDEX KEY: 0000310569
STANDARD INDUSTRIAL CLASSIFICATION: MALT BEVERAGES [2082]
IRS NUMBER: 431162835
STATE OF INCORPORATION: DE
FISCAL YEAR END: 1231
FILING VALUES:
FORM TYPE: 10-K
SEC ACT:
SEC FILE NUMBER: 001-07823
FILM NUMBER: 1583170
BUSINESS ADDRESS:
STREET 1: ONE BUSCH PL
CITY: ST LOUIS
STATE: MO
ZIP: 63118
BUSINESS PHONE: 3145772000
MAIL ADDRESS:
STREET 1: ONE BUSCH PL
CITY: ST LOUIS
STATE: MO
ZIP: 63118
</SEC-HEADER>
<DOCUMENT>
<TYPE>10-K
<SEQUENCE>1
<FILENAME>eo10k.txt
<DESCRIPTION>ANHEUSER BUSCH FORM 10-K
<TEXT>
<PAGE> 1
===============================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
FORM 10-K
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
FOR THE FISCAL YEAR ENDED DECEMBER 31, 2000
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
FOR THE TRANSITION PERIOD FROM TO
------------ ---------
COMMISSION FILE NUMBER 1-7823
ANHEUSER-BUSCH COMPANIES, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN CHARTER)
DELAWARE 43-1162835
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION NO.)
ONE BUSCH PLACE, ST. LOUIS, MISSOURI 63118
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: 314-577-2000
------------------------
SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:
<TABLE>
<CAPTION>
NAME OF EACH EXCHANGE
TITLE OF EACH CLASS ON WHICH REGISTERED
------------------- ----------------------
<S> <C>
COMMON STOCK--$1 PAR VALUE NEW YORK STOCK EXCHANGE
PREFERRED STOCK PURCHASE RIGHTS NEW YORK STOCK EXCHANGE
6 1/2% DEBENTURES DUE JANUARY 1, 2028 NEW YORK STOCK EXCHANGE
</TABLE>
SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT:
NONE
--------------------------
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes X No .
---
Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to
the best of registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. [X]
State the aggregate market value of the voting stock held by nonaffiliates
of the registrant.
$38,782,498,869 AS OF FEBRUARY 28, 2001
Indicate the number of shares outstanding of each of the registrant's classes
of common stock, as of the latest practicable date.
$1 PAR VALUE COMMON STOCK 897,348,540 SHARES AS OF MARCH 9, 2001
DOCUMENTS INCORPORATED BY REFERENCE
<TABLE>
<S> <C>
Portions of Annual Report to Shareholders for the Year
Ended December 31, 2000............................... PART I, PART II, and PART IV
Portions of Definitive Proxy Statement for Annual
Meeting of Shareholders on April 25, 2001............. PART III and PART IV
</TABLE>
===============================================================================
<PAGE> 2
PART I
ITEM 1. BUSINESS
Anheuser-Busch Companies, Inc. (the "Company") is a Delaware corporation
that was organized in 1979 as the holding company parent of Anheuser-Busch,
Incorporated ("ABI"), a Missouri corporation whose origins date back to 1875.
In addition to ABI, which is the world's largest brewer of beer, the Company is
also the parent corporation to a number of subsidiaries that conduct various
other business operations. The Company's operations are comprised of the
following business segments: domestic beer, international beer, packaging,
entertainment and other. Financial information with respect to the Company's
business segments appears in Note 14, "Business Segments," on pages
54-55 of the 2000 Annual Report to Shareholders, which Note hereby is
incorporated by reference.
Domestic beer volume was 98.3 million barrels in 2000 as compared with 95.7
million barrels in 1999. Worldwide sales of the Company's beer brands
aggregated 105.6 million barrels in 2000 as compared with 102.9 million barrels
in 1999 and accounted for approximately 81% of the Company's consolidated net
sales dollars in 2000, 82% in 1999 and 80% in 1998. Worldwide beer volume is
comprised of domestic and international volume. Domestic volume represents
Anheuser-Busch brands produced and shipped within the United States including
Puerto Rico and the Caribbean. International volume represents Anheuser-Busch
brands produced overseas by Company-owned breweries and under license and
contract brewing agreements, plus exports from the Company's U.S. breweries to
markets around the world. Total volume includes worldwide Anheuser-Busch brand
volume combined with the Company's pro rata share of the volume of
international equity partner, Grupo Modelo, S.A. de C.V. In 1999, total volume
included the Company's pro rata share of the volume of international equity
partner, Companhia Antarctica Paulista for the first six months. Total beer
volume was 121.3 million barrels and 118.0 million barrels in 2000 and 1999,
respectively.
DOMESTIC BEER OPERATIONS
The Company's principal product is beer, produced and distributed by its
subsidiary, ABI, in a variety of containers primarily under the brand names
Budweiser, Bud Light, Bud Dry, Bud Ice, Bud Ice Light, Michelob, Michelob
Light, Michelob Golden Draft, Michelob Golden Draft Light, Michelob Black & Tan
Lager, Michelob Amber Bock, Michelob Honey Lager, Michelob Hefe-Weizen, Busch,
Busch Light, Busch Ice, Natural Light, Natural Ice, King Cobra, Red Wolf Lager,
ZiegenBock Amber, Hurricane Malt Liquor, Hurricane Ice, Pacific Ridge Ale, and
Tequiza. ABI's products also include three non-alcohol malt beverages,
O'Doul's, Busch NA, and O'Doul's Amber. During 2000 ABI introduced "Doc" Otis
Lemon, "Doc" Otis Apple, Killarney's, Tequiza Extra and Michelob Marzen and
discontinued Devon's Shandy, Rhumba, Tequiza Extra, Azteca, Michelob Pale Ale,
Michelob Classic Dark, and Michelob Dry. The Company brews Kirin Light, Kirin
Lager, and Kirin-Ichiban through a joint venture agreement with Kirin Brewing
Company, Ltd. of Japan for sale in the United States. ABI owns a 26% equity
interest in Seattle-based Redhook Ale Brewery, Inc. Through this alliance,
Redhook products are distributed by many ABI wholesalers and exclusively by ABI
wholesalers in all new U.S. markets entered by Redhook since 1994. ABI also
owns a 36% interest in Portland-based Widmer Brothers Brewing Company. Widmer
products are distributed by many ABI wholesalers and exclusively by ABI
wholesalers in all new U.S. markets entered by Widmer since 1997.
Budweiser, Bud Light, Bud Dry, Bud Ice, Bud Ice Light, Michelob, Michelob
Light, Michelob Black & Tan Lager, Michelob Golden Draft, Michelob Golden Draft
Light, Michelob Amber Bock, Michelob Honey Lager, Michelob Hefe-Weizen, Busch,
Busch Light, Natural Light, Natural Ice, Red Wolf Lager, ZiegenBock Amber,
Kirin-Ichiban, O'Doul's, O'Doul's Amber, "Doc" Otis Lemon, Killarney's, Widmer
beer products, and Redhook Ales are sold in both draught and packaged form.
Busch Ice, King Cobra, Michelob Marzen, Hurricane Malt Liquor, Tequiza,
Hurricane Ice, Kirin Lager, Kirin Light, and Busch NA are sold only in packaged
form. "Doc" Otis Apple and Pacific Ridge Ale are sold only in draught form.
Budweiser, Bud Light, Bud Ice, Bud Ice Light, Michelob, Michelob Light,
Michelob Amber Bock, Tequiza, Natural Light, Natural Ice, O'Doul's Amber,
O'Doul's, "Doc" Otis Lemon, and Michelob Hefe-Weizen are distributed and sold
on a nationwide basis. Busch, Busch Light, Michelob Honey Lager, and Redhook
Ales are sold in 49 states; Michelob Marzen in 48 states; Michelob Black & Tan
Lager in 47 states; Bud Dry in 46 states; King Cobra, Red Wolf Lager, and Busch
NA in 45 states; Hurricane Malt Liquor, Killarney's and Kirin Lager in 43
states; Kirin-Ichiban in 42 states; Kirin Light in 27 states; Busch Ice in 22
states; Widmer beer products in 18 states; Michelob Golden Draft and Michelob
Golden Draft Light in 9 states; "Doc" Otis Apple in 4 states; Pacific Ridge Ale
in 2 states; Hurricane Ice and ZiegenBock Amber in 1 state.
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<PAGE> 3
ABI has developed a system of twelve breweries, strategically located
across the country, to economically serve its distribution system. (See Item 2
of Part I--Properties.) Ongoing modernization programs at the Company's
breweries are part of ABI's overall strategic initiatives. By using controlled
environment warehouses and stringent inventory monitoring policies, the quality
and freshness of the product are protected, thus providing ABI a significant
competitive advantage.
During 2000 approximately 95% of the beer sold by ABI, measured in barrels,
reached retail channels through nearly 700 independent wholesalers. ABI
utilizes its regional vice-presidents, sales directors, key account and market
managers, as well as certain other field sales personnel, to provide
merchandising and sales assistance to its wholesalers. In addition, ABI
provides national and local media advertising, point-of-sale advertising, and
sales promotion programs to help stimulate sales. The remainder of ABI's
domestic beer sales in 2000 were made through twelve branches which perform
similar sales, merchandising, and delivery services as wholesalers in their
respective areas; these branches are owned and operated by the Company or
direct or indirect subsidiaries of the Company. ABI's peak selling periods are
the second and third quarters.
There are more than 100 companies engaged in the highly competitive brewing
industry in the United States. ABI's domestic beers are distributed and sold in
competition with other nationally distributed beers, with locally and
regionally distributed beers and with imported beers. Although the methods of
competition in the industry vary widely, in part due to differences in
applicable state laws, the principal methods of competition are product
quality, taste and freshness, packaging, price, advertising (including
television, radio, sponsorships, billboards, stadium signs, and print media),
point-of-sale materials, and service to retail customers (including the
replacement of over-age products with fresh products at no cost to the
retailer). ABI's beers compete in different price categories. Although all
brands compete against the total market, Budweiser, Bud Light, Bud Dry, Bud
Ice, Bud Ice Light, Michelob Golden Draft, and Michelob Golden Draft Light
compete primarily with premium priced beers. Busch, Busch Light, Natural
Light, Busch Ice, and Natural Ice compete with the sub-premium or popular
priced beers. King Cobra, Hurricane Malt Liquor, and Hurricane Ice compete
against other brands in the malt liquor segment. Michelob, Michelob Light,
Michelob Amber Bock, Kirin Lager, Kirin Light, Kirin-Ichiban, Michelob Honey
Lager, Michelob Black & Tan Lager, Tequiza, Red Wolf Lager, ZiegenBock Amber,
Michelob Hefe-Weizen, Pacific Ridge Ale, "Doc" Otis Lemon, "Doc" Otis Apple,
Killarney's, Michelob Marzen, the Redhook products, and Widmer beer products
compete primarily in the above premium beers segment of the malt beverage
market. O'Doul's and O'Doul's Amber (premium priced) and Busch NA (sub-premium
priced) compete in the non-alcohol malt beverage category. Since 1957, ABI has
led the United States brewing industry in total sales volume. In 2000, its
sales exceeded those of its nearest competitor by more than 57 million barrels.
ABI's domestic market share (excluding exports) for 2000 was 48.4%. Including
exports, ABI's share of U.S. shipments for 2000 was 48.3%. Major competitors in
the United States brewing industry during 2000 included Philip Morris, Inc.
(through its subsidiary Miller Brewing Co.), Adolph Coors Co., and Pabst
Brewery Co.
The Company's wholly-owned subsidiary, Busch Agricultural Resources, Inc.
("BARI"), operates rice milling and research facilities in Arkansas and
California; twelve grain elevators in the western and midwestern United States;
barley seed processing plants in Fairfield, Montana, Idaho Falls, Idaho, and
Powell, Wyoming; and a barley research facility in Ft. Collins, Colorado. BARI
also owns and operates malt plants in Manitowoc, Wisconsin, Moorhead,
Minnesota, and Idaho Falls, Idaho. In 2000, BARI sold its seed processing
facility in Moorhead, Minnesota. Through wholly-owned subsidiaries, BARI
operates land application farms in Jacksonville, Florida and Fort Collins,
Colorado; hop farms in Bonners Ferry, Idaho and Huell, Germany; and
international offices in Mar del Plata, Argentina and Winnipeg, Canada.
Another wholly-owned subsidiary, Wholesaler Equity Development Corporation,
shares equity positions with qualified partners in independent beer
wholesalerships and is currently invested in 7 wholesalerships.
INTERNATIONAL BEER OPERATIONS
International beer volume was 7.3 million barrels in 2000, compared with
7.2 million barrels in 1999. Anheuser-Busch International, Inc. ("ABII"), a
wholly-owned subsidiary of the Company, oversees the marketing and sale of
Budweiser and other ABI brands outside the U.S., operates breweries in the
United Kingdom (U.K.) and China, negotiates and administers license and
contract brewing agreements on behalf of ABI with various foreign brewers and
negotiates and manages equity investments in foreign brewing partners. In
addition, ABI's beer products are
2
<PAGE> 4
being sold under import-distribution agreements in more than 80 countries and
U.S. territories and to the U.S. military and diplomatic corps outside the
continental United States.
Through Anheuser-Busch Europe Limited ("ABEL"), an indirect, wholly-owned
subsidiary of the Company, certain ABI beer brands are marketed, distributed
and sold in twenty-nine European countries. In the U.K., ABEL sells Budweiser,
Bud Ice, Michelob, and Michelob Golden Draft brands to selected on-premise
accounts, brewers, wholesalers and directly to off-premise accounts. Budweiser
is brewed and packaged at the Stag Brewery near London, England which is
managed and operated by ABEL. Michelob and Michelob Golden Draft continue to be
imported into the U.K. by ABEL.
In Canada, Budweiser and Bud Light are brewed and sold through a license
agreement with Labatt Brewing Co. In Japan, Budweiser is brewed and sold
through a license agreement with Kirin Brewery Company, Limited. Budweiser is
also brewed under license and sold by brewers in Korea (Oriental Brewery Co.,
Ltd.), the Republic of Ireland and Northern Ireland (Guinness Ireland Limited),
Italy (Birra Peroni Industriale) and the Philippines (Asia Brewery,
Incorporated). Budweiser is brewed, packaged and distributed on a non-exclusive
basis in Spain by Sociedad Anonima Damm, one of the largest brewers in Spain,
under a contract brewing agreement with ABII. The Company has a partnership
with Brasseries Kronenbourg, the leading brewer in France, for sale and
distribution of Bud in France.
In 1995, the Company formed an alliance with Compania Cervecerias Unidas
S.A. ("CCU"), the leading Chilean brewer. Under the terms of the alliance, a
subsidiary of CCU in Argentina ("CCU-Argentina") brews and distributes
Budweiser under license in Argentina and Uruguay, and under contract for sale
in Paraguay, Chile and Brazil. CCU also distributes Budweiser in Chile. The
Company has a direct and indirect ownership interest of approximately 26% of
CCU-Argentina. In the first quarter 2001, the Company purchased approximately
18.5% of CCU.
In 1995, the Company purchased an initial 80% equity interest in a joint
venture, renamed the Budweiser Wuhan International Brewing Company, Ltd., that
owns and operates a brewery in Wuhan, the fifth-largest city in China. This
ownership interest has subsequently increased to 91.8%. The Company also owns a
5% equity interest in Tsingtao Brewery Company, Ltd., a leading Chinese brewer.
In 1993, Anheuser-Busch purchased a 17.7% direct and indirect equity
interest in Grupo Modelo's operating subsidiary, Diblo, for $477 million. In
May 1997, the Company increased its direct and indirect equity ownership in
Diblo to 37% for an additional $605 million. In September 1998, the Company
completed the purchase of an additional 13.25% of Diblo for $556.5 million,
bringing the Company's total investment to $1.6 billion. The Company now owns a
50.2% direct and indirect interest in Diblo. However, the Company does not have
voting or other effective control in either Grupo Modelo or Diblo.
PACKAGING OPERATIONS
The Company's wholly-owned subsidiary, Metal Container Corporation ("MCC"),
manufactures beverage cans at eight plants and beverage can lids at three
plants for sale to ABI, U.S. soft drink customers and Grupo Modelo. (See Item 2
of Part 1--Properties). Another wholly-owned subsidiary of the Company,
Anheuser-Busch Recycling Corporation ("ABRC"), recycles aluminum cans at its
plant in Hayward, California, for conversion into new can sheet. The Company's
wholly-owned subsidiary, Precision Printing and Packaging, Inc. ("PPPI"),
manufactures metalized and paper labels at its plant in Clarksville, Tennessee.
Eagle Packaging, Inc. ("EPI") manufactures and sells crown and closure liner
materials.
The Company is in the process of completing the construction of a glass
manufacturing plant near Houston, Texas. This plant is owned and operated by a
limited partnership of the Company known as Longhorn Glass Manufacturing, L.P.
The plant is scheduled to begin operations in Summer 2001 at which time it will
produce amber bottles for the Company's nearby Houston brewery.
FAMILY ENTERTAINMENT
The Company is active in the family entertainment field, primarily through
its wholly-owned subsidiary, Busch Entertainment Corporation ("BEC"), which
currently owns, directly and through subsidiaries, nine theme parks.
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BEC operates Busch Gardens theme parks in Tampa, Florida and Williamsburg,
Virginia, and SeaWorld theme parks in Orlando, Florida, San Antonio, Texas, and
San Diego, California. BEC operates water park attractions in Tampa, Florida
(Adventure Island), Williamsburg, Virginia (Water Country, U.S.A.), and
Langhorne, Pennsylvania (Sesame Place). In 2000, BEC opened Discovery Cove in
Orlando, Florida, a reservations only attraction offering interaction with
marine animals. BEC sold the assets of SeaWorld Cleveland to Six Flags, Inc. in
February 2001 at which time the park ceased operations as SeaWorld. Due to the
seasonality of the theme park business, BEC experiences higher revenues in the
second and third quarters than in the first and fourth quarters.
Through a Spanish affiliate, the Company also owns a 16.3% equity interest
in Port Aventura, S.A., which is a theme park near Barcelona, Spain.
The Company faces competition in the family entertainment field from other
theme and amusement parks, public zoos, public parks, and other family
entertainment events and attractions.
OTHER
Through its wholly-owned subsidiary, Busch Properties, Inc. ("BPI"), the
Company is engaged in the business of real estate development. BPI also owns
and operates The Kingsmill Resort and Conference Center in Williamsburg,
Virginia.
Through other wholly-owned subsidiaries, the Company owns and operates a
marketing communications business (Busch Creative Services Corporation) and a
transportation service business (Manufacturers Railway Co.).
SOURCES AND AVAILABILITY OF RAW MATERIALS
The products manufactured by the Company require a large volume of various
agricultural products, including barley for malt; hops, malt, rice, and corn
grits for beer; and rice for the rice milling and processing operations of
BARI. The Company fulfills its commodities requirements through purchases from
various sources, including purchases from its subsidiaries, through contractual
arrangements, and through purchases on the open market. The Company believes
that adequate supplies of the aforementioned agricultural products are
available at the present time, but cannot predict future availability or prices
of such products and materials. The commodity markets have experienced and will
continue to experience price fluctuations. The price and supply of raw
materials will be determined by, among other factors, the level of crop
production, weather conditions, export demand, and government regulations and
legislation affecting agriculture.
ENERGY MATTERS
The Company uses natural gas, fuel oil and coal as its primary fuel
materials.
Supplies of fuel and electricity in quantities sufficient to meet ABI's
requirements are expected to be available on a year-round basis during 2001.
The cost of fuel and electricity used by ABI increased in 2000 and is expected
to increase in 2001.
Based upon information presently available, there can be no assurance that
adequate supplies of fuel and electricity will always be available to the
Company. In the event of a supply disruption, the Company's sales and earnings
could be adversely affected. However, where applicable, the Company does have
alternate fuel capability and limited electric generation to ensure continued
operation of essential processes.
BRAND NAMES AND TRADEMARKS
Some of the Company's major brand names used in its principal business
segments are mentioned in the discussion above. The Company regards consumer
recognition of and loyalty to all of its brand names and trademarks as
extremely important to the long-term success of its principal business
segments.
RESEARCH AND DEVELOPMENT
The Company is involved in a number of research activities relating to the
development of new products or services or the improvement of existing products
or services. The dollar amounts expended by the Company during
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<PAGE> 6
the past three years on such research activities and the number of employees
engaged full time therein during such period, however, are not considered to be
material in relation to the total business of the Company.
ENVIRONMENTAL PROTECTION
All of the Company's facilities are subject to federal, state, and local
environmental protection laws and regulations, and the Company is operating
within existing laws and regulations or is taking action aimed at assuring
compliance therewith. Various proactive strategies are utilized to help assure
this compliance. Compliance with such laws and regulations is not expected to
materially affect the Company's capital expenditures, earnings, or competitive
position. The Company has devoted considerable effort to research, development
and engineering of cost effective innovative systems to minimize effects on the
environment from its operating facilities.
These projects, coupled with the Company's Environmental Management System
and an overall Company emphasis on pollution prevention and resource
conservation initiatives, are improving efficiencies and creating saleable
by-products from residuals. They have generally resulted in low cost operating
systems while reducing impact to air, water, and land.
ENVIRONMENTAL PACKAGING LAWS AND REGULATIONS
The states of California, Connecticut, Delaware, Iowa, Maine,
Massachusetts, Michigan, New York, Oregon, and Vermont have adopted certain
restrictive packaging laws and regulations for beverages that require deposits
on packages. ABI continues to do business in these states. Such laws have not
had a significant effect on ABI's sales, but have had a significant adverse
impact on beer industry growth and are considered by the Company to be
inflationary, costly, and inefficient for recycling packaging materials.
Congress and a number of additional states continue to consider similar
legislation, the adoption of which by Congress or a substantial number of
states or additional local jurisdictions might require the Company to incur
significant capital expenditures to comply.
NUMBER OF EMPLOYEES
As of December 31, 2000, the Company had 23,725 full-time employees.
As of December 31, 2000, approximately 7,700 employees were represented by
the International Brotherhood of Teamsters. Seventeen other unions represented
approximately 1,000 employees. The labor agreement between ABI and the Brewery
and Soft Drink Workers Conference of the International Brotherhood of
Teamsters, which represents the majority of brewery workers, was scheduled to
expire on February 28, 1998; it was extended to March 29, 1998 while the
parties continued to negotiate a new agreement. Talks with the Teamsters
reached impasse, and as a result, the Company implemented its final contract
offer on September 21, 1998. The National Labor Relations Board has determined
that the Company's bargaining and implementation of its final offer did not
violate federal labor law.
The national contract offer was ratified in a vote in August 1999. At that
time 11 of 24 local supplements had been approved. By June 2000, all local
units except for two were approved and on October 27, 2000 the Company was
notified by officials of the International Brotherhood of Teamsters that the
remaining locals had ratified their local supplements. The agreement, which
would expire on February 29, 2004, will be finalized if the parties resolve
National Labor Relations Board charges and other litigation as required by the
Company's offer. If the National Labor Relations Board charges and other
litigation are not resolved, then the terms of the implemented final offer will
remain in place. That offer is for a contract which would expire on February
23, 2003.
The Company considers its employee relations to be good.
ITEM 2. PROPERTIES
ABI has twelve breweries in operation at the present time, located in St.
Louis, Missouri; Newark, New Jersey; Los Angeles and Fairfield, California;
Jacksonville, Florida; Houston, Texas; Columbus, Ohio; Merrimack,
New Hampshire; Williamsburg, Virginia; Baldwinsville, New York; Fort Collins,
Colorado; and Cartersville, Georgia. Title to the Baldwinsville, New York
brewery is held by the Onondaga County Industrial Development Agency ("OCIDA")
pursuant to a Sale and Agency Agreement with ABI, which enabled OCIDA to issue
tax exempt pollution control and industrial development revenue notes and bonds
to finance a portion of the cost of the purchase and modification of the
brewery. The brewery is not pledged or mortgaged to secure any of the notes or
bonds, and
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the Sale and Agency Agreement with OCIDA gives ABI the unconditional right to
require at any time that title to the brewery be transferred to ABI. ABI's
breweries operated at approximately 96% of capacity in 2000; during the peak
selling periods (second and third quarters), they operated at maximum capacity.
The Company also owns a 91.8% equity interest in a joint venture that owns and
operates a brewery in Wuhan, China. The Company also leases and operates the
Stag Brewery near London, England.
The Company, through wholly-owned subsidiaries, operates malt plants in
Manitowoc, Wisconsin, Moorhead, Minnesota, and Idaho Falls, Idaho; rice mills
in Jonesboro, Arkansas and Woodland, California; a hop farm in Bonners Ferry,
Idaho; can manufacturing plants in Jacksonville, Florida, Columbus, Ohio,
Arnold, Missouri, Windsor, Colorado, Newburgh, New York, Ft. Atkinson,
Wisconsin, Rome, Georgia, and Mira Loma, California; can lid manufacturing
plants in Gainesville, Florida, Oklahoma City, Oklahoma, and Riverside,
California; a crown and closure liner material plant in Bridgeton, Missouri;
and a packaging materials recycling plant in Hayward, California.
BEC operates its principal family entertainment facilities in Tampa,
Florida; Williamsburg, Virginia; San Diego, California; Orlando, Florida; and
San Antonio, Texas. The Tampa facility is 265 acres, Williamsburg is 364 acres,
San Diego is 182 acres, Orlando is 284 acres, and the San Antonio facility is
496 acres.
Except for the Baldwinsville brewery, the can manufacturing plants in
Newburgh, New York and Rome, Georgia, the SeaWorld park in San Diego,
California, the Stag Brewery, and the brewery in Wuhan, China, all of the
Company's principal properties are owned in fee. The lease for the land used by
the SeaWorld park in San Diego, California expires in 2048. The Company leases
the Stag Brewery from Scottish Courage, Ltd. In 1995, the joint venture that
operates the brewery in Wuhan was granted the right to use the property for a
period of 50 years from the appropriate governmental authorities. The Company
also leases a bottling line at its brewery in Cartersville, Georgia and a can
manufacturing plant in Rome, Georgia. The Company considers its buildings,
improvements, and equipment to be well maintained and in good condition,
irrespective of dates of initial construction, and adequate to meet the
operating demands placed upon them. The production capacity of each of the
manufacturing facilities is adequate for current needs and, except as described
above, substantially all of each facility's capacity is utilized.
ITEM 3. LEGAL PROCEEDINGS
The Company is not a party to any pending or threatened litigation, the
outcome of which would be expected to have a material adverse effect upon its
financial condition or its operations.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
There were no matters submitted to a vote of security holders, through the
solicitation of proxies or otherwise, during the fourth quarter ended December
31, 2000.
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EXECUTIVE OFFICERS OF THE REGISTRANT
AUGUST A. BUSCH III (age 63) is presently Chairman of the Board and
President, and a Director of the Company and has served in such capacities
since 1977, 1974, and 1963, respectively. Since 1979 he has also served as
Chairman of the Board of the Company's subsidiary, Anheuser-Busch, Incorporated
and also previously served as its Chief Executive Officer (1979-July 2000).
PATRICK T. STOKES (age 58) is presently Senior Executive Vice President and
a Director of the Company and has served in such capacities since July 2000 and
April 2000, respectively. He previously served as Vice President and Group
Executive of the Company since 1981. He is also presently Chief Executive
Officer and President of the Company's subsidiary, Anheuser-Busch,
Incorporated, and has served in such capacities since July 2000 and 1990
respectively, and Chairman of the Board of the Company's subsidiary,
Anheuser-Busch International, Inc., and has served in such capacity since 1999.
JOHN H. PURNELL (age 59) is presently Executive Vice President of the
Company and has served in such capacity since 1999; he will retire from this
position on March 31, 2001. He previously served as Vice President and Group
Executive of the Company (1991-1998). He also previously served as Chairman of
the Board of the Company's subsidiary, Anheuser-Busch International, Inc.
(1980-November 1999), and as its Chief Executive Officer (1991-1998).
W. RANDOLPH BAKER (age 54) is presently Vice President and Chief Financial
Officer of the Company and has served in such capacity since 1996. He
previously served as Vice President and Group Executive of the Company
(1982-1996).
STEPHEN K. LAMBRIGHT (age 58) is presently Group Vice President and General
Counsel of the Company and has served in such capacity since 1997. He
previously served as Vice President and Group Executive of the Company
(1984-1997).
ALOYS H. LITTEKEN (age 60) is presently Vice President-Corporate
Engineering of the Company and has served in such capacity since 1981.
DONALD W. KLOTH (age 59) is presently Vice President and Group Executive of
the Company and has served in such capacity since 1994. He is also Chairman of
the Board and Chief Executive Officer of the Company's subsidiary, Busch
Agricultural Resources, Inc., and has served in such capacity since 1994.
JOHN E. JACOB (age 66) is presently Executive Vice President and Chief
Communications Officer, and a Director of the Company and has served in such
capacities since 1994 and 1990, respectively.
GERHARDT A. KRAEMER (age 68) is presently Senior Vice President-World
Brewing and Technology and has served in such capacity since 1996. During the
past five years, he also served as Vice President-Brewing of the Company's
subsidiary, Anheuser-Busch, Incorporated (1985-1996).
THOMAS W. SANTEL (age 42) is presently Vice President-Corporate Development
of the Company and has served in such capacity since 1996. During the past five
years, he also served as Director of Corporate Development (1994-1996).
STEPHEN J. BURROWS (age 49) is presently Vice President-International
Operations of the Company and has served in such capacity since 1999. He
previously served as Vice President-International Marketing of the Company
(1992-1998). He is also presently Chief Executive Officer and President of the
Company's subsidiary, Anheuser-Busch International, Inc. and has served as
Chief Executive Officer since 1999 and as President since 1994. During the past
five years, he also served as Chief Operating Officer of Anheuser-Busch
International, Inc. (1994-1998).
VICTOR G. ABBEY (age 45) is presently Chairman of the Board and President
of the Company's subsidiary, Busch Entertainment Corporation and has served in
such capacities since March 2000. During the past five years, he also served as
Executive Vice President and General Manager of the SeaWorld theme park in
Orlando, Florida (1997-February, 2000), and Executive Vice President and
General Manager of the SeaWorld theme park in Cleveland, Ohio (1995-1997).
7
<PAGE> 9
AUGUST A. BUSCH IV (age 36) is presently Vice President and Group Executive
of the Company and has served in such capacity since August 2000. He is also
presently Vice President-Marketing and Wholesale Operations of the Company's
subsidiary, Anheuser-Busch, Incorporated and has served in such capacity since
August 2000, and had previously served as its Vice President-Marketing
(1996-2000) and Vice President-Brand Management (1994-1996).
MARK T. BOBAK (age 41) is presently Vice President-Corporate Human
Resources of the Company and has served in such capacity since August 2000. He
had previously served as Vice President and Deputy General Counsel of the
Company (1998-July 2000) and Vice President-Litigation (1996-1998) of the
Company.
JOSEPH P. SELLINGER (age 55) is presently Vice President and Group
Executive of the Company and has served in such capacity since December 2000.
He is also presently Chairman, Chief Executive Officer and President of the
Company's direct subsidiaries, Anheuser-Busch Recycling Corporation, Metal
Container Corporation, Eagle Packaging, Inc. and of the Company's indirect
subsidiary, Precision Printing and Packaging, Inc. and has served in all such
capacities since December 2000. He had previously served as Vice
President-Operations of the Company's subsidiary, Anheuser-Busch, Incorporated
(1992-December 2000).
PART II
The information required by Items 5, 6, 7, and 8 of this Part II are hereby
incorporated by reference from pages 25 through 59 of the Company's 2000 Annual
Report to Shareholders.
ITEM 5. MARKET FOR THE REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER
MATTERS
ITEM 6. SELECTED FINANCIAL DATA
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE
None.
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
The information required by this Item with respect to Directors is hereby
incorporated by reference from pages 6 through 8 of the Company's Proxy
Statement for the Annual Meeting of Shareholders on April 25, 2001. The
information required by this Item with respect to Executive Officers is
presented on pages 7 and 8 of this Form 10-K.
ITEM 11. EXECUTIVE COMPENSATION
The information required by this Item is hereby incorporated by reference
from page 10 and pages 24 through 30 of the Company's Proxy Statement for the
Annual Meeting of Shareholders on April 25, 2001.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The information required by this Item is hereby incorporated by reference
from pages 9 and 10 of the Company's Proxy Statement for the Annual Meeting of
Shareholders on April 25, 2001.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The information required by this Item is hereby incorporated by reference
from pages 30 and 31 of the Company's Proxy Statement for the Annual Meeting of
Shareholders on April 25, 2001.
8
<PAGE> 10
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULE, AND REPORTS ON FORM 8-K
(a) THE FOLLOWING DOCUMENTS ARE FILED AS PART OF THIS REPORT:
<TABLE>
<C> <S> <C>
1. FINANCIAL STATEMENTS: PAGE
----
Consolidated Balance Sheet at December 31, 2000 and 1999 40*
Consolidated Statement of Income for the three years ended
December 31, 2000 41*
Consolidated Statement of Changes in Shareholders Equity for the three
years ended December 31, 2000 42*
Consolidated Statement of Cash Flows for the three years ended December
31, 2000 43*
Notes to Consolidated Financial Statements 44-55*
Report of Independent Accountants 39*
<FN>
*Incorporated herein by reference from the indicated pages of the 2000
Annual Report to Shareholders.
</FN>
<C> <S> <C>
2. FINANCIAL STATEMENT SCHEDULE:
Report of Independent Accountants on Financial Statement Schedule F-1
For the three years ended December 31, 2000:
Schedule VIII--Valuation and Qualifying Accounts and Reserves F-2
<C> <S>
3. EXHIBITS:
Exhibit 3.1 -- Restated Certificate of Incorporation (Incorporated by
reference to Exhibit 3.1 to Form 10-K for the fiscal year
ended December 31, 1999).
Exhibit 3.2 -- By-Laws of the Company (as amended and restated
December 16, 1998). (Incorporated by reference to Exhibit 3.2
to Form 10-K for the fiscal year ended December 31, 1998).
Exhibit 4.1 -- Form of Rights Agreement, dated as of October 26, 1994
between Anheuser-Busch Companies, Inc. and Boatmen's Trust
Company (Incorporated by reference to Exhibit 4.1 to Form 10-K
for the fiscal year ended December 31, 1999).
Exhibit 4.2 -- Letter Agreement dated March 19, 1998 between
Anheuser-Busch Companies, Inc., Boatmen's Trust Company,
and ChaseMellon Shareholder Services, L.L.C. amending the
Form of Rights Agreement filed as Exhibit 4.1 of this
report. (Incorporated by reference to Exhibit 4.2 to
Form 10-K for the fiscal year ended December 31, 1998).
Exhibit 4.3 -- Indenture dated as of August 1, 1995 between the
Company and The Chase Manhattan Bank, as Trustee (Incorporated
by reference to Exhibit 4.1 in the Form S-3 of the
Company, Registration Statement No. 33-60885.) (Other
indentures are not filed, but the Company agrees to
furnish copies of such instruments to the Securities
and Exchange Commission upon request.)
Exhibit 4.4 -- Credit Agreement dated as of June 30, 2000 among the Company, ABI
and The Chase Manhattan Bank, as Administrative Agent.
Exhibit 10.1 -- Anheuser-Busch Companies, Inc. Deferred Compensation Plan for
Non-Employee Directors amended and restated as of March 1,
2000 (Incorporated by reference to Exhibit 10.1 to Form
10-K for the fiscal year ended December 31, 1999).*
9
<PAGE> 11
Exhibit 10.2 -- Anheuser-Busch Companies, Inc. Non-Employee Director
Elective Stock Acquisition Plan amended and restated as
of March 1, 2000 (Incorporated by reference to Exhibit
10.2 to Form 10-K for the fiscal year ended December
31, 1999).*
Exhibit 10.3 -- Anheuser-Busch Companies, Inc. Stock Plan for
Non-Employee Directors as amended.*
Exhibit 10.4 -- Anheuser-Busch Companies, Inc. 1981 Incentive Stock
Option/Non-Qualified Stock Option Plan (As amended
December 18, 1985, December 16, 1987, December 20,
1988, July 22, 1992, September 22, 1993, December 20,
1995, and November 26, 1997.) (Incorporated by
reference to Exhibit 10.3 to Form 10-K for the fiscal
year ended December 31, 1997.)*
Exhibit 10.5 -- Anheuser-Busch Companies, Inc. 1989 Incentive Stock
Plan (As amended December 20, 1989, December 19, 1990,
December 15, 1993, December 20, 1995, and November 26,
1997.) (Incorporated by reference to Exhibit 10.5 to
Form 10-K for the fiscal year ended December 31, 1997.)*
Exhibit 10.6 -- Anheuser-Busch Companies, Inc. 1998 Incentive Stock Plan
as amended (Incorporated by reference to Appendix A to the
Definitive Proxy Statement for Annual Meeting of
Shareholders on April 25, 2001.)*
Exhibit 10.7 -- Anheuser-Busch Companies, Inc. Excess Benefit Plan
amended and restated as of March 1, 2000 (Incorporated by
reference to Exhibit 10.9 to Form 10-K for the fiscal year
ended December 31, 1999).*
Exhibit 10.8 -- Anheuser-Busch Companies, Inc. Supplemental Executive
Retirement Plan amended and restated as of March 1, 2001.*
Exhibit 10.9 -- Anheuser-Busch Executive Deferred Compensation Plan
amended and restated as of January 1, 2001.*
Exhibit 10.10-- Anheuser-Busch 401(k) Restoration Plan amended and
restated as of March 1, 2000 (Incorporated by reference
to Exhibit 10.12 to Form 10-K for the fiscal year ended
December 31, 1999).*
Exhibit 10.11-- Form of Indemnification Agreement with Directors and
Executive Officers (Incorporated by reference to Exhibit
10.13 to Form 10-K for the fiscal year ended December 31,
1999).*
Exhibit 10.12-- Anheuser-Busch Officer Bonus Plan as amended and
restated on November 24, 1999. (Incorporated by reference
to Exhibit A to the Definitive Proxy Statement for Annual
Meeting of Shareholders on April 26, 2000.)*
Exhibit 10.13-- Investment Agreement By and Among Anheuser-Busch
Companies, Inc., Anheuser-Busch International, Inc. and
Anheuser-Busch International Holdings, Inc. and Grupo
Modelo, S.A. de C.V., Diblo, S.A. de C.V. and certain
shareholders thereof, dated as of June 16, 1993
(Incorporated by reference to Exhibit 10.15 to Form
10-K for the fiscal year ended December 31, 1999).
Exhibit 10.14-- Letter agreement between Anheuser-Busch Companies,
Inc. and the Controlling Shareholders regarding Section
5.5 of the Investment Agreement filed as Exhibit 10.13 of
this report (Incorporated by reference to Exhibit 10.16
to Form 10-K for the fiscal year ended December 31, 1999).
Exhibit 12 -- Ratio of Earnings to Fixed Charges.
10
<PAGE> 12
Exhibit 13 -- Pages 25 through 59 of the Anheuser-Busch Companies,
Inc. 2000 Annual Report to Shareholders, a copy of
which is furnished for the information of the Securities
and Exchange Commission. Portions of the Annual Report not
incorporated herein by reference are not deemed "filed"
with the Commission.
Exhibit 21 -- Subsidiaries of the Company
Exhibit 23 -- Consent of Independent Accountants, filed as page F-1
of this report.
<FN>
- --------
* A management contract or compensatory plan or
arrangement required to be filed by Item 14(c) of this
report.
</FN>
</TABLE>
(b) Reports on Form 8-K
There were no reports on Form 8-K filed during the fourth quarter of 2000.
11
<PAGE> 13
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed
on its behalf by the undersigned, thereunto duly authorized.
ANHEUSER-BUSCH COMPANIES, INC.
-------------------------------------------------
(Registrant)
By /s/ AUGUST A. BUSCH III
-------------------------------------------------
August A. Busch III
Chairman of the
Board and President
Date: March 28, 2001
Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
registrant and in the capacities and on the dates indicated.
<TABLE>
<C> <S> <C>
/s/ AUGUST A. BUSCH III Chairman of the Board and President and March 28, 2001
-------------------------------------------------- Director (Principal Executive
(August A. Busch III) Officer)
/s/ W. RANDOLPH BAKER Vice President and Chief Financial March 28, 2001
-------------------------------------------------- Officer (Principal Financial Officer)
(W. Randolph Baker)
/s/ JOHN F. KELLY Vice President and Controller March 28, 2001
-------------------------------------------------- (Principal Accounting Officer)
(John F. Kelly)
/s/ BERNARD A. EDISON Director March 28, 2001
--------------------------------------------------
(Bernard A. Edison)
/s/ CARLOS FERNANDEZ G. Director March 28, 2001
--------------------------------------------------
(Carlos Fernandez G.)
/s/ JOHN E. JACOB Director March 28, 2001
--------------------------------------------------
(John E. Jacob)
/s/ JAMES R. JONES Director March 28, 2001
--------------------------------------------------
(James R. Jones)
/s/ CHARLES F. KNIGHT Director March 28, 2001
--------------------------------------------------
(Charles F. Knight)
/s/ VERNON R. LOUCKS, JR. Director March 28, 2001
--------------------------------------------------
(Vernon R. Loucks, Jr.)
12
<PAGE> 14
/s/ VILMA S. MARTINEZ Director March 28, 2001
--------------------------------------------------
(Vilma S. Martinez)
/s/ JAMES B. ORTHWEIN Director March 28, 2001
--------------------------------------------------
(James B. Orthwein)
/s/ WILLIAM PORTER PAYNE Director March 28, 2001
--------------------------------------------------
(William Porter Payne)
/s/ JOYCE M. ROCHE Director March 28, 2001
--------------------------------------------------
(Joyce M. Roche)
/s/ PATRICK T. STOKES Director March 28, 2001
--------------------------------------------------
(Patrick T. Stokes)
/s/ ANDREW C. TAYLOR Director March 28, 2001
--------------------------------------------------
(Andrew C. Taylor)
/s/ DOUGLAS A. WARNER III Director March 28, 2001
--------------------------------------------------
(Douglas A. Warner III)
/s/ EDWARD E. WHITACRE, JR. Director March 28, 2001
--------------------------------------------------
(Edward E. Whitacre, Jr.)
</TABLE>
13
<PAGE> 15
ANHEUSER-BUSCH COMPANIES, INC.
INDEX TO FINANCIAL STATEMENT SCHEDULE
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Report of Independent Accountants on Financial Statement
Schedule.................................................... F-1
Consent of Independent Accountants.......................... F-1
Financial Statement Schedule for the Years 2000, 1999 and
1998:
Valuation and Qualifying Accounts and Reserves (Schedule
VIII)................................................. F-2
</TABLE>
All other Financial Statement Schedules are omitted because they are not
applicable or the required information is shown in the Consolidated Financial
Statements and Notes.
Separate financial statements of subsidiaries not consolidated have been
omitted because, in the aggregate, the proportionate shares of their profit
before income taxes and total assets are less than 20% of the respective
consolidated amounts, and investments in such companies are less than 20% of
consolidated total assets.
14
<PAGE> 16
REPORT OF INDEPENDENT ACCOUNTANTS ON FINANCIAL STATEMENT SCHEDULE
To the Board of Directors
of Anheuser-Busch Companies, Inc.
Our audits of the consolidated financial statements referred to in our report
dated February 6, 2001 appearing in the 2000 Annual Report to Shareholders of
Anheuser-Busch Companies, Inc. (which report and consolidated financial
statements are incorporated by reference in this Annual Report on Form 10-K)
also included an audit of the financial statement schedule listed in Item
14(a)(2) of this Form 10-K. In our opinion, the financial statement schedule
presents fairly, in all material respects, the information set forth therein
when read in conjunction with the related consolidated financial statements.
PricewaterhouseCoopers LLP
St. Louis, Missouri
February 6, 2001
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in the Prospectus
constituting part of the Registration Statements on Forms S-3 (No. 333-71105
and No. 333-3766) and in the Registration Statements on Forms S-8 (No.
2-77829, No. 33-4664, No. 33-36132, No. 33-39714, No. 33-39715, No. 33-46846,
No. 33-53333, No. 33-58221, No. 33-58241, No. 333-67027, No. 333-71309, No.
333-71311, No. 333-88015, and No. 333-50058) of Anheuser-Busch Companies, Inc.
of our report dated February 6, 2001 relating to the consolidated financial
statements, which appears in the Annual Report to Shareholders, which is
incorporated in this Annual Report on Form 10-K. We also consent to the
incorporation by reference of our report dated February 6, 2001 relating to
the financial statement schedule, which appears on page F-1 of this Form 10-K.
PricewaterhouseCoopers LLP
St. Louis, Missouri
March 28, 2001
F-1
<PAGE> 17
<TABLE>
ANHEUSER-BUSCH COMPANIES, INC.
SCHEDULE VIII--VALUATION AND QUALIFYING ACCOUNTS AND RESERVES
(IN MILLIONS)
<CAPTION>
2000 1999 1998
---- ---- ----
<S> <C> <C> <C>
Reserve for doubtful accounts (deducted from related
assets):
Balance at beginning of period.......................... $ 6.4 $ 5.5 $ 4.9
Additions charged to costs and expenses................. 1.8 1.0 1.3
Additions (recoveries of uncollectible accounts
previously written off ).............................. .1 .1 .3
Deductions (uncollectible accounts written off )........ (.1) (.2) (1.0)
------ ------ ------
Balance at end of period................................ $ 8.2 $ 6.4 $ 5.5
====== ====== ======
Deferred income tax asset valuation allowance under FAS 109:
Balance at beginning of period.......................... $ 13.6 $117.0 $ 92.5
Additions to valuation allowance charged to costs and
expenses.............................................. 9.7 3.5 28.1
Deductions from valuation allowance (utilizations and
expirations).......................................... (8.6) (14.1) (3.6)
Reductions due to changes in foreign business
operations............................................ -- (92.8) --
------ ------ ------
Balance at end of period................................ $ 14.7 $ 13.6 $117.0
====== ====== ======
</TABLE>
F-2
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-4
<SEQUENCE>2
<FILENAME>eoex4.txt
<DESCRIPTION>EXHIBIT 4
<TEXT>
<PAGE>
<PAGE> 1
=============================================================================
EXECUTION COPY
$2,000,000,000
CREDIT AGREEMENT
Dated as of June 30, 2000
among
ANHEUSER-BUSCH COMPANIES, INC.
ANHEUSER-BUSCH, INCORPORATED
The Banks Listed Herein
and
THE CHASE MANHATTAN BANK,
as Administrative Agent
---------------------------
CHASE SECURITIES INC.,
As Advisor, Lead Arranger and Book Manager
BANK ONE, NA,
CITIBANK, N.A.,
and
THE INDUSTRIAL BANK OF JAPAN, LIMITED
As Co-Syndication Agents
=============================================================================
<PAGE>
<PAGE> 2
CREDIT AGREEMENT dated as of June 30, 2000, among
ANHEUSER-BUSCH COMPANIES, INC., a Delaware corporation,
ANHEUSER-BUSCH, INCORPORATED, a Missouri corporation, the
BANKS listed on the signature pages hereof and THE CHASE
MANHATTAN BANK as Administrative Agent.
The parties hereto agree as follows:
ARTICLE I
DEFINITIONS
Section 1.01. Definitions. The following terms, as used herein,
-----------
have the following meanings:
"ABI" means Anheuser-Busch, Incorporated, a Missouri corporation,
---
and its successors and permitted assigns.
"ABI Guarantee" means the Guarantee of ABI under Article IX in
-------------
respect of the Loans and other amounts owing hereunder.
"Absolute Rate Auction" means a solicitation of Money Market Quotes
---------------------
setting forth Money Market Absolute Rates pursuant to Section 2.04.
"Adjusted CD Rate" has the meaning set forth in Section 2.08(b).
----------------
"Adjusted LIBO Rate" has the meaning set forth in Section 2.08(c).
------------------
"Administrative Agent" means The Chase Manhattan Bank in its
--------------------
capacity as agent for the Banks hereunder and its successors in such
capacity.
"Administrative Questionnaire" means, with respect to each Bank, an
----------------------------
administrative questionnaire in the form prepared by the Administrative Agent
and submitted to the Administrative Agent (with a copy to the Company) duly
completed by such Bank.
"Affiliate" means, with respect to a Person, any other Person that,
---------
directly or indirectly through one or more intermediaries, controls, or is
controlled by, or is under common control with, such first Person.
"Assessment Rate" has the meaning set forth in Section 2.08(b).
---------------
"Bank" means a financial institution listed on the signature pages
----
hereof as having
<PAGE>
<PAGE> 3
2
a Commitment or a financial institution added pursuant to Section 8.05,
and its successors and permitted assigns; and "Banks" means all of such
-----
institutions.
"Bank Affiliate" means, with respect to any Bank, (i) an Affiliate
--------------
of such Bank or (ii) any entity (whether a corporation, partnership, trust
or otherwise) that is engaged in making, purchasing, holding or otherwise
investing in bank loans and similar extensions of credit in the ordinary
course of its business and is administered or managed by a Bank or an
Affiliate of such Bank.
"Base Rate" means, for any day, a rate per annum equal to the higher
---------
of (i) the Prime Rate for such day and (ii) the sum of 1/2 of 1% plus the
Federal Funds Rate for such day.
"Base Rate Loan" means a Syndicated Loan to be made as a Base Rate
--------------
Loan pursuant to Section 2.03 and in accordance with the applicable Notice
of Borrowing, or a Loan to be made as a Base Rate Loan pursuant to the final
proviso of clause (1) or clause (2) of the definition of Interest Period or
pursuant to Article VIII.
"Benefit Arrangement" means an employee benefit plan within the
-------------------
meaning of Section 3 (3) of ERISA which is not a Plan or a Multiemployer Plan
and which is maintained or otherwise contributed to by any member of the
ERISA Group.
"Board of Directors" means either the board of directors of the
------------------
Company or any duly authorized committee of that board.
"Board Resolution" means a copy of a resolution certified by the
----------------
Secretary or an Assistant Secretary of the Company to have been duly adopted
by the Board of Directors and to be in full force and effect on the date of
such certification, and delivered to the Administrative Agent.
"Borrower" means the Company or an Eligible Subsidiary, as the
--------
context may require, and their respective successors and permitted assigns.
"Borrowing" means a borrowing hereunder consisting of Loans made to
---------
a Borrower at the same time and for the same Interest Period by one or more
of the Banks severally. A Borrowing is a "Domestic Borrowing" if such Loans
------------------
are Domestic Loans or a "Euro-Dollar Borrowing" if such Loans are Euro-Dollar
---------------------
Loans. A Domestic Borrowing is a "CD Borrowing" if such Domestic Loans are
------------
CD Loans or a "Base Rate Borrowing" if such Domestic Loans are Base Rate
-------------------
Loans. A Borrowing is a "Syndicated Borrowing" if such Loans are Syndicated
--------------------
Loans. A Borrowing is a "Money Market Borrowing" if such Loans are Money
----------------------
Market Loans. A Borrowing is a "Negotiated Rate Borrowing" if such Loans are
-------------------------
Negotiated Rate Loans.
"CD Base Rate" has the meaning set forth in Section 2.08(b).
------------
"CD Loan" means a Syndicated Loan to be made as a CD Loan pursuant
-------
to Section 2.03 and the applicable Notice of Borrowing.
<PAGE>
<PAGE> 4
3
"CD Margin" has the meaning set forth in Section 2.08(b).
---------
"CD Reserve Percentage" has the meaning set forth in Section
---------------------
2.08(b).
"Code" means the Internal Revenue Code of 1986, as amended.
----
"Chase" means The Chase Manhattan Bank.
-----
"Commitment" means, with respect to each Bank, the amount set forth
----------
opposite the name of such Bank on Schedule I hereto, as such amount may from
time to time be reduced pursuant to Section 2.10.
"Company" means Anheuser-Busch Companies, Inc., a Delaware
-------
corporation, and its successors and permitted assigns.
"Company's 1999 Form 10-K" means the Company's annual report on Form
------------------------
10-K for 1999, as filed with the Securities and Exchange Commission pursuant
to the Securities Exchange Act of 1934, as amended.
"Consolidated Net Worth" means, at any date, (i) the consolidated
----------------------
shareholders equity of the Company (including amounts representing preferred
stock) as of such date (ii) minus, if positive, or plus, if negative, the
foreign currency translation adjustment that would be reflected as a separate
component of consolidated shareholders equity of the Company on a
consolidated balance sheet of the Company as of such date.
"Consolidated Subsidiary" means, with respect to any Person at any
-----------------------
date, any Subsidiary or other entity the accounts of which are consolidated
with those of such Person in its consolidated financial statements as of such
date.
"Consolidated Tangible Net Worth" means, at any date, Consolidated
-------------------------------
Net Worth after deducting therefrom all (i) goodwill, trade names,
trademarks, patents, copyrights, franchises, unamortized debt discount and
expense, organization and development expense and other intangibles of the
Company and its Consolidated Subsidiaries, all determined on a basis
consistent with that on which such amounts were determined in preparing the
most recent balance sheet of the Company and its Consolidated Subsidiaries
delivered to the Banks pursuant to Section 5.01(a)(i) or (ii), and (ii)
increases in the book values of any assets above the book values thereof
as of March 31, 2000 as a result of any revaluation of such assets.
"Continuing Directors" means, at any date, the Persons who served
--------------------
as directors of the Company 15 months prior to such date and any new director
of the Company whose appointment or election by the Board of Directors or
nomination for election by the Company's stockholders was approved or
recommended by the affirmative vote of a majority of the Continuing Directors
serving at the time of such appointment, election or nomination.
"Debt" of any Person means at any date, without duplication, to the
----
extent obligations of such type are required to be set forth as liabilities
in such Person's financial
<PAGE>
<PAGE> 5
4
statements according to generally accepted accounting principles (except in
the case of clause (v) of this definition), (i) all obligations of such
Person for borrowed money, (ii) all obligations of such Person evidenced by
bonds, debentures, notes or other similar instruments, (iii) all obligations
of such Person to pay the deferred purchase price of property or services,
except trade accounts payable arising in the ordinary course of business,
(iv) the capitalized value of all obligations of such Person as lessee under
leases capitalized in accordance with generally accepted accounting
principles, (v) all Debt of others secured by a Lien on any asset of such
Person, whether or not such Debt is assumed by such Person (provided that,
--------
for purposes of this clause (v), the amount of any such Debt, unless assumed
by such Person, shall be deemed not to exceed the higher of the market value
or the net book value of such asset), and (vi) the amounts of all Debt of
other Persons Guaranteed by such Person.
"Default" means any condition or event which constitutes an Event of
-------
Default or which with the giving of notice or passing of time or both would,
unless cured or waived, become an Event of Default.
"Domestic Business Day" means any day, except a Saturday, Sunday or
---------------------
other day on which commercial banks in New York City are authorized by law
to close.
"Domestic Lending Office" means, as to each Bank, its office or
-----------------------
branch (or affiliate) located at its address set forth in its Administrative
Questionnaire (or identified in its Administrative Questionnaire as its
Domestic Lending Office) or such other office as such Bank may hereafter
designate as its Domestic Lending Office by notice to the Company and the
Administrative Agent; provided that any Bank may from time to time by notice
--------
to the Company and the Administrative Agent designate separate Domestic
Lending Offices for its Base Rate Loans, on the one hand, and its CD Loans,
on the other hand, in which case all references herein to the Domestic
Lending Office of such Bank shall be deemed to refer to either or both of
such offices, as the context may require.
"Domestic Loan" means a CD Loan or a Base Rate Loan, and "Domestic
------------- --------
Loans" means CD Loans or Base Rate Loans or both.
- -----
"Domestic Subsidiary" means a Subsidiary whose principal place of
-------------------
business is located within the United States.
"Effective Date" means the date (which shall not be later than
--------------
July 15, 2000) on which this Agreement shall become effective in accordance
with Sections 3.02 and 10.09.
"Election to Participate" means an election to participate
-----------------------
substantially in the form of Exhibit K hereto.
"Election to Terminate" means an election to terminate substantially
---------------------
in the form of Exhibit L hereto.
"Eligible Subsidiary" means any Subsidiary of the Company that is
-------------------
a wholly-owned Consolidated Subsidiary of the Company and as to which an
Election to Participate shall
<PAGE>
<PAGE> 6
5
have been delivered to the Administrative Agent and as to which an Election
to Terminate shall not have been delivered to the Administrative Agent.
"Environmental Laws" means any and all federal, state, local and
------------------
foreign statutes, laws, regulations, ordinances, rules, judgments, orders,
decrees, permits, concessions, grants, franchises, licenses, agreements or
other governmental restrictions relating to the environment or to emissions,
discharges or releases of pollutants, contaminants, petroleum or petroleum
products, chemicals or industrial, toxic or hazardous substances or wastes
into the environment including, without limitation, ambient air, surface
water, ground water, or land, or otherwise relating to the manufacture,
processing, distribution, use, treatment, storage, disposal, transport or
handling of pollutants, contaminants, petroleum or petroleum products,
chemicals or industrial, toxic or hazardous substances or wastes or the
clean-up or other remediation thereof.
"ERISA" means the Employee Retirement Income Security Act of 1974,
-----
as amended, or any successor statute.
"ERISA Group" means the Company and all members of a controlled
-----------
group of corporations and all trades or businesses (whether or not
incorporated) under common control which, together with the Company, are
treated as a single employer under Section 414(b) or (c) of the Code.
"Euro-Dollar Business Day" means any Domestic Business Day on which
------------------------
commercial banks are open for international business (including dealings in
U.S. Dollar deposits) in London.
"Euro-Dollar Lending Office" means, as to each Bank, its office or
--------------------------
branch (or affiliate) located at its address set forth in its Administrative
Questionnaire (or identified in its Administrative Questionnaire as its
Euro-Dollar Lending Office) or such other office or branch (or affiliate) of
such Bank as it may hereafter designate as its Euro-Dollar Lending Office by
notice to the Company and the Administrative Agent.
"Euro-Dollar Loan" means a Syndicated Loan to be made as a
----------------
Euro-Dollar Loan pursuant to Section 2.03 and the applicable Notice of
Borrowing.
"Euro-Dollar Margin" has the meaning set forth in Section 2.08(c).
------------------
"Event of Default" has the meaning set forth in Section 6.01.
----------------
"Executive Officer" means the Chief Executive Officer, the
-----------------
President, the Chief Financial Officer or the Treasurer of the Company.
"Federal Funds Rate" means, for any day, the rate per annum (rounded
------------------
upward, if necessary, to the nearest 1/100th of 1%) equal to the weighted
average of the rates on overnight Federal funds transactions with members of
the Federal Reserve System arranged by Federal funds brokers on such day, as
published by the Federal Reserve Bank of New York on the Domestic Business
Day next succeeding such day, provided that (i) if such day is not a Domestic
--------
<PAGE>
<PAGE> 7
6
Business Day, the Federal Funds Rate for such day shall be such rate on such
transactions on the next preceding Domestic Business Day as so published on
the next succeeding Domestic Business Day, and (ii) if no such rate is so
published on such next succeeding Domestic Business Day, the Federal Funds
Rate for such day shall be the average rate quoted to the Person serving as
the Administrative Agent on such day on such transactions as determined by
the Administrative Agent.
"Finance Committee" means the Finance Committee established by the
-----------------
Board of Directors.
"Fixed Rate Borrowing" means a Borrowing consisting of Fixed Rate
--------------------
Loans.
"Fixed Rate Loans" means CD Loans, Euro-Dollar Loans, Money Market
----------------
Loans (excluding Money Market LIBOR Loans bearing interest at the Base Rate
pursuant to Section 8.01(a)) or Negotiated Rate Loans or any combination of
the foregoing.
"Funded Debt" means, as of any date, without duplication, all
-----------
Indebtedness, and all Debt, whether or not for money borrowed, evidenced
by a bond, debenture, note or similar instrument or by an agreement, which
Indebtedness or Debt (i) has a maturity of more than twelve months from the
date as of which the amount thereof is to be determined, (ii) has a maturity
of twelve months or less, but by its terms is renewable or extendible beyond
twelve months from such date at the option of the borrower or issuer without
the consent of the lender or holder and subject only to conditions which the
borrower or issuer is then capable of fulfilling or (iii) is classified as
"long-term indebtedness" in the Company's financial statements delivered to
the Banks pursuant to Section 5.01(a).
"Guarantee" of any Person means any obligation, contingent or
---------
otherwise, of such Person directly or indirectly guaranteeing any Debt of any
other Person or in any manner providing for the payment of any Debt of any
other Person or otherwise protecting the holder of any such Debt against loss
(whether by agreement to keep-well, to maintain minimum net worth, to
purchase assets, goods, securities or services, to take-or-pay or otherwise);
provided that the term Guarantee shall not include endorsements for
- --------
collection or deposit in the ordinary course of business. The term
"Guarantee" used as a verb has a correlative meaning.
---------
"Guaranty Fee Agreement" means the Guaranty Fee Agreement dated as
----------------------
of June 30, 2000, between the Company and ABI in the form of Exhibit J hereto.
"Indebtedness" of any Person means any indebtedness of such Person
------------
representing money borrowed.
"Index Debt" means senior, unsecured, long-term Indebtedness of the
----------
Company that is not supported by any letter of credit, guarantee (other than
a guarantee by ABI) or other credit enhancement.
"Interest Period" means:
---------------
<PAGE>
<PAGE> 8
7
(1) with respect to each CD Loan, the period commencing on the date
of such Loan and ending 30, 60, 90 or 180 days thereafter, as the Company may
elect in the applicable Notice of Borrowing; provided that:
--------
(a) any Interest Period which would otherwise end on a day which
is not a Domestic Business Day shall be extended to the next succeeding
Domestic Business Day; and
(b) any Interest Period which would otherwise end after the
Termination Date shall end on the Termination Date;
provided further, however, that if any such Interest Period would be less
- ---------------- -------
than 30 days, the Loan for such Interest Period shall be a Base Rate Loan;
(2) with respect to each Euro-Dollar Loan, the period commencing on
the date of such Loan and ending seven days, fourteen days or one, two,
three, six or, with the consent of each Bank, twelve months thereafter, as
the Company may elect in the applicable Notice of Borrowing; provided that:
--------
(a) any Interest Period which would otherwise end on a day which
is not a Euro-Dollar Business Day shall be extended to the next
succeeding Euro-Dollar Business Day unless such succeeding Euro-Dollar
Business Day falls in another calendar month, in which case such Interest
Period shall end on the next preceding Euro-Dollar Business Day;
(b) any Interest Period (other than an Interest Period having
a duration of seven or fourteen days) which begins on the last
Euro-Dollar Business Day of a calendar month (or on a day for which
there is no numerically corresponding day in the calendar month at the
end of such Interest Period) shall, subject to clause (c) of this
definition, end on the last Euro-Dollar Business Day of a calendar
month; and
(c) any Interest Period which would otherwise end after the
Termination Date shall end on the Termination Date;
provided further, however, that if any such Interest Period would be less
- ---------------- -------
than seven days, the Loan for such Interest Period shall be a Base Rate Loan;
(3) with respect to each Base Rate Loan, the period commencing on
the date of such Loan and ending not less than one day thereafter, as the
Company may elect in the applicable Notice of Borrowing; provided that:
--------
(a) any Interest Period which would otherwise end on a day which
is not a Domestic Business Day shall be extended to the next succeeding
Domestic Business Day; and
(b) any Interest Period which would otherwise end after the
Termination Date
<PAGE>
<PAGE> 9
8
shall end on the Termination Date;
(4) with respect to each Money Market Borrowing, the period
commencing on the date of such Borrowing and ending such number of days
thereafter (but not less than seven days), as the Company may elect in
accordance with Section 2.04; provided that:
--------
(a) any Interest Period which would otherwise end on a day which
is not a Euro-Dollar Business Day shall be extended to the next
succeeding Euro-Dollar Business Day unless, in the case of a Money
Market LIBOR Borrowing, such Euro-Dollar Business Day falls in another
calendar month, in which case such Interest Period shall end on the next
preceding Euro-Dollar Business Day; and
(b) any Interest Period which would otherwise end after the
Termination Date shall end on the Termination Date; and
(5) With respect to each Negotiated Rate Loan, such Interest Period
(ending on a Euro-Dollar Business Day not falling after the Termination Date)
as may be agreed between the Company and the Bank making such Loan.
"Lending Office" means, as to any Bank, its Domestic Lending Office,
--------------
its Euro-Dollar Lending Office or its Money Market Lending Office, as the
context may require.
"Level I Pricing Period" has the meaning set forth in Section 2.16.
----------------------
"Level II Pricing Period" has the meaning set forth in Section 2.16.
-----------------------
"LIBO Rate" has the meaning set forth in Section 2.08(c).
---------
"LIBOR Auction" means a solicitation of Money Market Quotes setting
-------------
forth Money Market Margins based on the LIBO Rate pursuant to Section 2.04.
"Lien" means, with respect to any asset, any mortgage, lien, pledge,
----
charge, security interest or encumbrance of any kind in respect of such
asset. For the purposes of this Agreement, the Company or any of its
Subsidiaries shall be deemed to own subject to a Lien any asset which it has
acquired or holds subject to the interest of a vendor or lessor under any
conditional sale agreement, capital lease or other title retention agreement
relating to such asset.
"Loan" means a Domestic Loan, a Euro-Dollar Loan, a Negotiated Rate
----
Loan or a Money Market Loan, and "Loans" means Domestic Loans, Euro-Dollar
-----
Loans, Negotiated Rate Loans, Money Market Loans or any of the foregoing.
"Material Plan" means a Plan having aggregate Unfunded Liabilities
-------------
in excess of $100,000,000.
"Maturity Date" in respect of each Loan, has the meaning set forth
-------------
in Section 2.07.
<PAGE>
<PAGE> 10
9
"Money Market Absolute Rate" has the meaning set forth in Section
--------------------------
2.04(d).
"Money Market Absolute Rate Loan" means a Loan made pursuant to an
-------------------------------
Absolute Rate Auction.
"Money Market Lending Office" means, as to each Bank, its Domestic
---------------------------
Lending Office or such other office, branch or affiliate of such Bank as it
may hereafter designate as its Money Market Lending Office by notice to the
Company and the Administrative Agent; provided that any Bank may from time to
--------
time by notice to the Company and the Administrative Agent designate separate
Money Market Lending Offices for its Money Market LIBOR Loans, on the one
hand, and its Money Market Absolute Rate Loans, on the other hand, in which
case all references herein to the Money Market Lending Office of such Bank
shall be deemed to refer to either or both of such offices, as the context
may require.
"Money Market LIBOR Loan" means a Loan made pursuant to a LIBOR
-----------------------
Auction (including such a Loan bearing interest at the Base Rate pursuant to
Section 8.01(a)).
"Money Market Loan" means a Money Market Absolute Rate Loan or a
-----------------
Money Market LIBOR Loan.
"Money Market Margin" has the meaning set forth in Section 2.04(d).
-------------------
"Money Market Quote" means an offer by a Bank to make a Money Market
------------------
Loan in accordance with Section 2.04.
"Moody's" means Moody's Investors Service and its successors.
-------
"Multiemployer Plan" means an employee pension benefit plan subject
------------------
to Section 4001(a)(3) of ERISA to which any member of the ERISA Group is then
making or accruing an obligation to make contributions or has within the
preceding five plan years made contributions, including for these purposes
any entity which ceased to be a member of the ERISA Group during such five
year period.
"Negotiated Rate Loan" means a Loan made by a Bank to a Borrower
--------------------
which is identified (by notice from the Bank or the Company to the
Administrative Agent) as a Loan made pursuant to Section 2.05.
"Net Tangible Assets" means total assets of the Company and its
-------------------
Restricted Subsidiaries, including net investment in Unrestricted
Subsidiaries, after deducting therefrom (a) all current liabilities of the
Company and its Restricted Subsidiaries (excluding any thereof constituting
Funded Debt), (b) all goodwill, trade names, trademarks, patents, copyrights,
franchises, unamortized debt discount and expense, organization and
developmental expenses and other intangibles of the Company and its
Restricted Subsidiaries, and (c) all increases in the book values of any
assets above the book values thereof as of March 31, 2000 as a result of the
revaluation of such assets, all determined on a basis consistent with that on
which such amounts were determined in preparing the most recent balance sheet
of the Company and its Consolidated
<PAGE>
<PAGE> 11
10
Subsidiaries delivered to the Banks pursuant to Section 5.01(a)(i) or
(ii); provided that any items constituting deferred income taxes, deferred
--------
investment tax credits or other similar items shall not be taken into account
as a liability or as a deduction from or adjustment to total assets.
"Non-excluded Taxes" has the meaning set forth in Section 2.15.
------------------
"Note" means a promissory note of a Borrower, substantially in the
----
form of Exhibit A hereto, evidencing the obligation of such Borrower to repay
its Loans, and "Notes" means all such promissory notes issued hereunder.
-----
"Notice of Borrowing" means a Notice of Syndicated Borrowing as
-------------------
defined in Section 2.03(a) or a Notice of Money Market Borrowing as defined
in Section 2.04(f).
"Packaging Business" means the assets identified as the "Packaging
------------------
Segment" in the most recent financial statements delivered pursuant to
Section 5.01(a) and any assets substantially related to such assets that are
acquired after the date of such financial statements.
"Packaging Business Divestiture" means (i) the distribution (in the
------------------------------
form of a dividend) to stockholders of the Company of the capital stock of a
Subsidiary or Subsidiaries substantially all of the assets of which
consist(s) of all or any portion of the Packaging Business and (ii) the
transfer of the capital stock of a Subsidiary or Subsidiaries substantially
all of the assets of which consist(s) of all or any portion of the Packaging
Business, or the transfer of all or any portion of the Packaging Business,
the consideration for such transfer (including the liabilities assumed
related thereto) being not less than the fair market value (as reasonably
determined by the Company) of such stock or assets; provided that in each
--------
such case at the time of and immediately after such distribution or transfer
the Index Debt shall be rated A- or better by S&P and A3 or better by
Moody's.
"PBGC" means the Pension Benefit Guaranty Corporation or any entity
----
succeeding to any or all of its functions under ERISA.
"Person" means an individual, sole proprietorship, corporation,
------
partnership, joint venture, trust, unincorporated organization, mutual
company, joint stock company, estate, union, employee organization, a
government or any agency or political subdivision thereof.
"Plan" means an employee pension benefit plan (other than a
----
Multiemployer Plan) which is covered by Title IV of ERISA or subject to the
minimum funding standards of Section 412 of the Code and either (i) is
maintained, or contributed to, by any member of the ERISA Group for employees
of any member of the ERISA Group or (ii) has at any time within the preceding
five years been maintained, or contributed to, by any member of the ERISA
Group for employees of any member of the ERISA Group, as determined from time
to time within such period.
"Pricing Period" has the meaning set forth in Section 2.16.
--------------
"Prime Rate" means the rate of interest per annum publicly announced
----------
from time
<PAGE>
<PAGE> 12
11
to time by the Person serving as the Administrative Agent as its prime rate
in effect at its principal office in New York City. Each change in the Prime
Rate shall be effective from and including the date such change is publicly
announced as being effective. The Base Rate shall be adjusted automatically
on and as of the effective date of each change in the Prime Rate.
"Principal Plant" shall mean (a) any brewery or manufacturing,
---------------
processing or packaging plant owned by the Company or any of its Subsidiaries
on the date hereof or hereafter constructed or acquired by the Company or any
of its Subsidiaries and located within the United States (but shall not
include (i) any brewery or plant which the Finance Committee has determined
is not of material importance to the total business conducted by the Company
and its Subsidiaries, (ii) any plant which the Company shall have determined
is used primarily for transportation, marketing or warehousing or (iii) at
the option of the Company, any plant that (A) does not constitute a part of
the brewing operations of the Company and its Subsidiaries and (B) has a net
book value, as reflected on the then most recent balance sheet delivered by
the Company to the Banks under Section 5.01(a), of not more than
$100,000,000, provided that any such determination, designation or election
--------
pursuant to clauses (i) through (iii) of this definition shall be evidenced
by a certificate of an Executive Officer delivered to the Administrative
Agent) and (b) any other facility owned by the Company or any of its
Subsidiaries which the Company shall designate as a Principal Plant.
Following any determination, designation or election referred to herein that
a brewery or plant shall not be included as a Principal Plant, the Company
may, at its option (to be evidenced by a certificate of an Executive Officer
delivered to the Administrative Agent), elect that such facility subsequently
be included as a Principal Plant.
"Pro Rata Percentage" means, in respect of any Bank, the percentage
-------------------
obtained by dividing the Commitment of such Bank by the Total Commitment.
"Reference Banks" means Chase, Citibank, N.A., Bank One, NA and such
---------------
other banks as may be appointed pursuant to Section 10.06(d).
"Refunding Borrowing" means a Borrowing which, after application of
-------------------
the proceeds thereof, results in no net increase in the outstanding principal
amount of the Loans made by any Bank.
"Required Banks" means at any time Banks having at least 51% of the
--------------
Total Commitment or, if the Commitments shall have been terminated, holding
at least 51% of the aggregate unpaid principal amount of the Loans.
"Restricted Subsidiary" means (i) any Subsidiary (including ABI) of
---------------------
the Company which owns or operates a Principal Plant, except any Subsidiary
incorporated or organized, or the principal place of business of which is
located, outside the present fifty states of the United States and the
District of Columbia, (ii) any Subsidiary that owns, directly or indirectly,
any stock of any Restricted Subsidiary, and (iii) any other Subsidiary of the
Company incorporated or organized within the present fifty states of the
United States and the District of Columbia which the Finance Committee shall
elect to be treated as a Restricted Subsidiary, until such time as the
Finance Committee may elect that such other Subsidiary shall no longer be a
Restricted Subsidiary, successive such elections being permitted without
restriction, provided that any such
--------
<PAGE>
<PAGE> 13
12
election pursuant to clause (iii) of this definition shall be evidenced by a
certificate of an Executive Officer delivered to the Administrative Agent and
shall be effective as of the date specified in the applicable certification.
"Revolving Credit Period" means the period from and including the
-----------------------
Effective Date to and including the Termination Date or, if earlier, the date
on which the Total Commitment is terminated.
"S&P" means Standard & Poor's Ratings Group and its successors.
---
"Subsidiary" means, with respect to any Person, any corporation of
----------
which more than 50% of the issued and outstanding Voting Stock is at the time
directly or indirectly owned by such Person.
"Syndicated Loan" means a Base Rate Loan, a CD Loan or a Euro-Dollar
---------------
Loan, as the case may be.
"Tax" means any federal, state, county, municipal or foreign tax,
---
assessment or other governmental charge or levy upon a Person or upon its
assets, revenues, income or profits.
"Termination Date" means June 30, 2005.
----------------
"Total Commitment" means, at any date, the aggregate Commitments of
----------------
all the Banks as of such date.
"United States" means the United States of America.
-------------
"Unfunded Liabilities" means the amount (if any) of unfunded current
--------------------
liabilities determined under Section 412(l)(1)(8)(A) of the Code without
regard to Section 412(l)(1)(8)(E) thereof, determined as of the most recent
valuation date for such Plan, but only if the Company knows or should have
known of such excess and to the extent that such excess represents a
potential liability of a member of the ERISA Group.
"Unrestricted Subsidiary" means any Subsidiary of the Company which
-----------------------
is not a Restricted Subsidiary.
"U.S. Dollars" means dollars in lawful currency of the United
------------
States.
"Voting Stock" means shares of stock of a corporation of any class or
------------
classes (however designated) having ordinary voting power for the election of
a majority of the members of the board of directors (or other governing body)
of such corporation, other than stock having such power only by reason of the
happening of a contingency.
Section 1.02. Accounting Terms and Determinations. Unless otherwise
-----------------------------------
specified herein, all accounting terms used herein shall be interpreted, all
accounting determinations hereunder shall be made, and all financial
statements required to be delivered hereunder shall be prepared, in
accordance with accounting principles generally accepted in the United States
as in
<PAGE>
<PAGE> 14
13
effect from time to time, applied on a basis consistent (except for changes
approved by the Company's independent public accountants) with the most
recent audited consolidated financial statements of the Company and its
Consolidated Subsidiaries delivered to the Banks; provided that, if the
--------
Company notifies the Administrative Agent that the Company wishes to amend
any provision of this Agreement to eliminate the effect of any change in
generally accepted accounting principles on the operation of such provision
(or if the Administrative Agent notifies the Company that the Required Banks
wish to amend any such provision for such purpose), then compliance with such
provision shall be determined on the basis of generally accepted accounting
principles in effect immediately before the relevant change in generally
accepted accounting principles became effective, until either such notice is
withdrawn or such amendment becomes effective in accordance with this
Agreement.
Section 1.03. Terms Generally. The definitions of terms herein
---------------
shall apply equally to the singular and plural forms of the terms defined.
Whenever the context may require, any pronoun shall include the corresponding
masculine, feminine and neuter forms. The words "include", "includes" and
"including" shall be deemed to be followed by the phrase "without
limitation". The word "will" shall be construed to have the same meaning and
effect as the word "shall". Unless the context requires otherwise (a)any
definition of or reference to any agreement, instrument or other document
herein shall be construed as referring to such agreement, instrument or other
document as from time to time amended, supplemented or otherwise modified
(subject to any restrictions on such amendments, supplements or modifications
set forth herein), (b)any reference herein to any Person shall be construed
to include such Person's successors and assigns, (c)the words "herein",
"hereof" and "hereunder", and words of similar import, shall be construed to
refer to this Agreement in its entirety and not to any particular provision
hereof, (d)all references herein to Articles, Sections, Exhibits and
Schedules shall be construed to refer to Articles and Sections of, and
Exhibits and Schedules to, this Agreement and (e)the words "asset" and
"property" shall be construed to have the same meaning and effect and to
refer to any and all tangible and intangible assets and properties, including
cash, securities, accounts and contract rights.
ARTICLE II
THE CREDITS
Section 2.01. The Commitments. Upon the terms and subject to the
---------------
conditions of, and in reliance on the representations and warranties made
under, this Agreement, the Banks severally agree to make Syndicated Loans to
the Company or to one or more Eligible Subsidiaries from time to time on or
prior to the Termination Date.
Section 2.02. The Syndicated Loans. During the Revolving Credit
--------------------
Period, each Bank severally agrees, on the terms and subject to the
conditions set forth in this Agreement, to lend to the Company or to one or
more Eligible Subsidiaries from time to time Syndicated Loans; provided that
--------
the aggregate principal amount of Syndicated Loans by such Bank at any one
time outstanding shall not exceed the amount of its Commitment at such time
less such Bank's Pro Rata Percentage of the sum of the aggregate principal
amount of Negotiated Rate
<PAGE>
<PAGE> 15
14
Loans outstanding at such time and Money Market Loans outstanding at such
time (in each case, regardless of the amount, if any, of Money Market Loans
or Negotiated Rate Loans actually made by such Bank and outstanding at such
time). Within the foregoing limits, the Borrowers may borrow under this
Section, repay, and, to the extent permitted under Section 2.11, prepay and
reborrow under this Section at any time during the Revolving Credit Period.
The failure of any Bank to make any Syndicated Loan required under this
Agreement shall not release any other Bank from its obligation to make
Syndicated Loans as provided herein.
Section 2.03. Syndicated Borrowings. (a) The Company shall give
---------------------
notice (a "Notice of Syndicated Borrowing") to the Administrative Agent not
------------------------------
later than (1) 1:00 P.M. (New York City time) on the proposed date of each
Base Rate Borrowing, (2) 12:00 Noon (New York City time) on the Domestic
Business Day before each CD Borrowing and (3) 12:00 Noon (New York City time)
on the third Euro-Dollar Business Day before each Euro-Dollar Borrowing;
provided, however, that, if the Company shall not have given to the
- -------- -------
Administrative Agent a Notice of Syndicated Borrowing for a Refunding
Borrowing in respect of a Syndicated Loan or Syndicated Loans, or part
thereof, by the close of business on the third Domestic Business Day prior to
the Maturity Date thereof, then such Syndicated Loan or Syndicated Loans or
part thereof shall come due on such Maturity Date. Each Notice of Syndicated
Borrowing shall specify:
(i) the date of such Borrowing, which shall be a Domestic Business
Day in the case of a Domestic Borrowing or a Euro-Dollar Business Day in
the case of a Euro-Dollar Borrowing,
(ii) the aggregate amount of such Borrowing, which shall be an
aggregate principal amount of $10,000,000 or any larger multiple of
$1,000,000 (except that any such Borrowing may be in the aggregate
amount of the unused Total Commitment),
(iii) whether the Loans comprising such Borrowing are to be
CD Loans, Base Rate Loans or Euro-Dollar Loans,
(iv) the duration of the initial Interest Period applicable to
such Borrowing, subject to the provisions of the definition of Interest
Period, and
(v) if the Borrower of such Borrowing is not the Company, the name
of the Eligible Subsidiary that will be the Borrower of such Borrowing.
A Notice of Syndicated Borrowing shall not be required in connection with a
Base Rate Borrowing pursuant to Section 8.01. A Notice of Syndicated
Borrowing, once given, shall not be revocable by the Company or the
applicable Borrower.
(b) Upon receipt of a Notice of Syndicated Borrowing given to it,
the Administrative Agent shall promptly notify each Bank of the contents
thereof and of such Bank's ratable share of such Borrowing.
(c) Each Syndicated Borrowing shall be made from the several Banks
ratably in
<PAGE>
<PAGE> 16
15
proportion to their respective Commitments.
(d) Not later than 2:00 P.M. (New York City time) on the date of
such Borrowing, in the case of a Base Rate Borrowing, or 12:00 Noon (New York
City time) on the date of such Borrowing, in the case of each CD Borrowing or
Euro-Dollar Borrowing, each Bank shall (except as provided in Section 2.12)
make available its ratable share of such Borrowing, in U.S. Dollars
immediately available in New York City, to the Administrative Agent at its
address specified in or pursuant to Section 10.01. Unless the Administrative
Agent determines that any applicable condition specified in Article III has
not been satisfied, the Administrative Agent will make the funds so received
from the Banks available to the Company (for the account of the applicable
Borrower) immediately thereafter at the Administrative Agent's aforesaid
address.
(e) If any Bank makes a new Syndicated Loan hereunder on a day on
which any Borrower is required to or has elected to repay all or any part of
an outstanding Syndicated Loan from such Bank (regardless of whether such
Syndicated Loans are to the same Borrower), such Bank shall apply the
proceeds of its new Syndicated Loan to make such repayment, and only an
amount equal to the difference (if any) between the amount being borrowed and
the amount being repaid shall be made available by such Bank to the
Administrative Agent as provided in the preceding subsection (d) or be
remitted by the applicable Borrower to the Administrative Agent as provided
in Section 2.12, as the case may be, and if such Syndicated Loans are to
different Borrowers the Company shall cause appropriate payments to be made
between such Borrowers to reflect the foregoing.
(f) Unless the Administrative Agent shall have received notice from
a Bank prior to the date of any Syndicated Borrowing that such Bank will not
make available to the Administrative Agent such Bank's share of such
Borrowing, the Administrative Agent may assume that such Bank has made such
share available to the Administrative Agent on the date of such Borrowing in
accordance with subsections (d) and (e) of this Section and the
Administrative Agent may, in reliance upon such assumption, make available to
the Company (for the account of the applicable Borrower) on such date a
corresponding amount. If and to the extent that such Bank shall not have so
made such share available to the Administrative Agent, such Bank and the
Company (for the account of the applicable Borrower) severally agree to repay
to the Administrative Agent forthwith on demand such corresponding amount
together with interest thereon, for each day from the date such amount is
made available to the Company until the date such amount is repaid to the
Administrative Agent, at (i) in the case of the Company, a rate per annum
equal to the higher of the Federal Funds Rate and the interest rate
applicable thereto pursuant to Section 2.08 and (ii) in the case of such
Bank, the Federal Funds Rate. If such Bank shall repay to the Administrative
Agent such corresponding amount, such amount so repaid shall constitute such
Bank's Loan included in such Borrowing for purposes of this Agreement.
Section 2.04. Money Market Borrowings. (a) The Money Market Option.
----------------------- -----------------------
The Company may, during the Revolving Credit Period, as set forth in this
Section, request the Banks to make offers to make Money Market Loans to the
Company or one or more Eligible Subsidiaries from time to time prior to the
Termination Date. The Banks may, but shall have no obligation to, make such
offers, and the Company may, but shall have no obligation to, accept
<PAGE>
<PAGE> 17
16
any such offers in the manner set forth in this Section.
(b) Money Market Quote Request. When the Company wishes to request
--------------------------
offers to make Money Market Loans under this Section, it shall transmit to
the Administrative Agent by telecopier a Money Market Quote Request
substantially in the form of Exhibit B hereto so as to be received by the
Administrative Agent not later than 10:00 A.M. (New York City time) on (x)
the Domestic Business Day next preceding the date of the Borrowing proposed
therein, in the case of an Absolute Rate Auction, or (y) the fourth
Euro-Dollar Business Day prior to the date of Borrowing proposed therein, in
the case of a LIBOR Auction (or, in either case, such other time or date as
the Company and the Administrative Agent shall have mutually agreed to and
shall have notified to the Banks not later than the date of the Money Market
Quote Request for the first LIBOR Auction or Absolute Rate Auction for which
such change is to be effective), specifying:
(i) the proposed date of Borrowing, which shall be a Euro-Dollar
Business Day in the case of a LIBOR Auction or a Domestic Business Day
in the case of an Absolute Rate Auction,
(ii) the aggregate amount of such Borrowing, which shall be
$10,000,000 or a larger multiple of $1,000,000,
(iii) the duration of the Interest Period applicable thereto,
subject to the provisions of the definition of Interest Period,
(iv) whether the Money Market Quotes requested are to set forth
a Money Market Margin or a Money Market Absolute Rate, and
(v) if the Borrower of such Borrowing is not the Company, the name
of the Eligible Subsidiary that will be the Borrower of such Borrowing.
The Company may request offers to make Money Market Loans for more than one
Interest Period in a single Money Market Quote Request. No Money Market Quote
Request shall be given within four Euro-Dollar Business Days (or such other
number of days as the Company and the Administrative Agent may agree) of any
other Money Market Quote Request.
(c) Invitation for Money Market Quotes. Promptly upon receipt of a
----------------------------------
Money Market Quote Request, the Administrative Agent shall send to the Banks
by telecopier an Invitation for Money Market Quotes, substantially in the
form of Exhibit C hereto, which shall constitute an invitation by the Company
(on behalf of the applicable Borrower) to each Bank to submit Money Market
Quotes offering to make the Money Market Loans to which such Money Market
Quote Request relates in accordance with this Section.
(d) Submission and Contents of Money Market Quotes. (i) Each Bank
----------------------------------------------
may submit a Money Market Quote containing an offer or offers to make Money
Market Loans in response to any Invitation for Money Market Quotes. Each
Money Market Quote must comply with the requirements of this subsection (d)
and must be submitted to the Administrative Agent
<PAGE>
<PAGE> 18
17
by telecopier at its offices specified in or pursuant to Section 10.01 not
later than (x) 10:00 A.M. (New York City time) on the third Euro-Dollar
Business Day prior to the proposed date of Borrowing, in the case of a LIBOR
Auction, or (y) 9:30 A.M. (New York City time) on the proposed date of
Borrowing, in the case of an Absolute Rate Auction (or, in either case, such
other time or date as the Company and the Administrative Agent shall have
mutually agreed to and shall have notified to the Banks not later than the
date of the Money Market Quote Request for the first LIBOR Auction or
Absolute Rate Auction for which such change is to be effective); provided
that Money Market Quotes submitted by the Administrative Agent (or any
Affiliate of the Administrative Agent) in its capacity as a Bank may only be
submitted if the Administrative Agent or such Affiliate notifies the Company
of the terms of the offer or offers contained therein not later than (x) one
hour prior to the deadline for the other Banks, in the case of a LIBOR
Auction, or (y) 15 minutes prior to the deadline for the other Banks, in the
case of an Absolute Rate Auction. Subject to Articles III and VI, any Money
Market Quote so made shall be irrevocable, except (A) as provided in Section
2.04(e) or (B) with the written consent of the Administrative Agent given on
the instructions of the Company.
(ii) Each Money Market Quote shall be in substantially the form of
Exhibit D hereto and shall in any case specify:
(A) the proposed date of Borrowing,
(B) the principal amount of each Money Market Loan for which an
offer is being made, which principal amount (w) may be greater than or
less than the Commitment of the quoting Bank, (x) must be $10,000,000
or a larger multiple of $1,000,000, (y) may not exceed the principal
amount of Money Market Loans for which offers were requested and (z) may
be subject to an aggregate limitation as to the principal amount of Money
Market Loans for which offers being made by such quoting Bank may be
accepted,
(C) in the case of a LIBOR Auction, the margin above or below the
applicable LIBO Rate (the "Money Market Margin") offered for such Money
-------------------
Market Loan, expressed as a percentage (specified to the nearest
1/10,000th of 1%) to be added to or subtracted from such base rate,
(D) in the case of an Absolute Rate Auction, the rate of interest
per annum (specified to the nearest 1/10,000th of 1%) (the "Money Market
------------
Absolute Rate") offered for each such Money Market Loan, and
-------------
(E) the identity of the quoting Bank.
A Money Market Quote may set forth up to five separate offers by the quoting
Bank with respect to each Interest Period specified in the related Invitation
for Money Market Quotes.
(iii) Any Money Market Quote shall be disregarded if it:
(A) is not substantially in the form of Exhibit D hereto or does
not specify all of the information required by subsection (d)(ii);
<PAGE>
<PAGE> 19
18
(B) contains qualifying, conditional or similar language;
(C) proposes terms other than or in addition to those set forth
in the applicable Invitation for Money Market Quotes; or
(D) arrives after the time set forth in subsection (d)(i).
(e) Notice to Company. The Administrative Agent shall promptly
-----------------
notify the Company of the terms (i) of any Money Market Quote submitted by a
Bank that is in accordance with subsection (d) and (ii) of any Money Market
Quote that amends, modifies or is otherwise inconsistent with a previous
Money Market Quote submitted by such Bank with respect to the same Money
Market Quote Request. Any such subsequent Money Market Quote shall be
disregarded by the Administrative Agent unless such subsequent Money Market
Quote is submitted solely to correct a manifest error in such previous Money
Market Quote. The Administrative Agent's notice to the Company shall specify
(A) the aggregate principal amount of Money Market Loans for which offers
have been received for each Interest Period specified in the related Money
Market Quote Request, (B) the respective principal amounts and Money Market
Margins or Money Market Absolute Rates, as the case may be, so offered and
(C) if applicable, any limitation on the aggregate principal amount of Money
Market Loans for which offers in any single Money Market Quote may be
accepted.
(f) Acceptance and Notice by Company. Not later than (x) 10:30 A.M.
--------------------------------
(New York City time) on the proposed date of Borrowing, in the case of an
Absolute Rate Auction, or (y) 11:00 A.M. (New York City time) on the third
Euro-Dollar Business Day prior to the proposed date of Borrowing, in the case
of a LIBOR Auction (or such other time and date as the Company and the
Administrative Agent shall have mutually agreed to and shall have notified to
the Banks not later than the date of the Money Market Quote Request for the
first LIBOR Auction or Absolute Rate Auction for which such change is to be
effective), the Company (on behalf of the applicable Borrower) shall notify
the Administrative Agent of its acceptance or non-acceptance of the offers so
notified to it pursuant to subsection (e). Failure of the Company to notify
the Administrative Agent of its acceptance or non-acceptance of offers by
such applicable time shall constitute non-acceptance of such offers by the
Company. In the case of acceptance, such notice (a "Notice of Money Market
----------------------
Borrowing"), which shall be in the form of Exhibit E hereto, shall specify
- ---------
the aggregate principal amount of offers for each Interest Period that are
accepted. The Company (on behalf of the applicable Borrower) may accept any
Money Market Quote in whole or in part; provided that:
--------
(i) the aggregate principal amount of each Money Market Borrowing
may not exceed the applicable amount set forth in the related Money
Market Quote Request and may not be in an amount that would result in the
aggregate principal amount of the outstanding Loans exceeding the Total
Commitment (after giving effect to all borrowings and repayments of Loans
then being made),
(ii) the aggregate principal amount of each Money Market Borrowing
must be $10,000,000 or a larger multiple of $1,000,000,
<PAGE>
<PAGE> 20
19
(iii) acceptance of offers may only be made on the basis of
ascending Money Market Absolute Rates or Money Market Margins, as the
case may be, and
(iv) the Company may not accept any offer that is described
in subsection (d)(iii) or that otherwise fails to comply with the
requirements of this Agreement.
(g) Allocation by Administrative Agent. If offers are made by two
----------------------------------
or more Banks with the same Money Market Margin or Money Market Absolute
Rate, as the case may be, and for a greater aggregate principal amount than
the principal amount (after deducting the principal amount of the lower
priced offers accepted by the Company) in respect of which offers are
accepted for the related Interest Period, the principal amount of Money
Market Loans in respect of which such offers are accepted shall be allocated
by the Administrative Agent among such Banks as nearly as possible (in
multiples of such amount not less than $1,000,000, as the Administrative
Agent may deem appropriate) in proportion to the aggregate principal amounts
of such offers. Determinations by the Administrative Agent of the amounts of
Money Market Loans to be made by each Bank shall be conclusive in the absence
of manifest error.
(h) Notice to Banks; Funding of Money Market Loans. (i) Upon
----------------------------------------------
receipt of a Notice of Money Market Borrowing by the Administrative Agent,
such Notice of Money Market Borrowing shall not thereafter be revocable by
the Company or the applicable Borrower. The Administrative Agent shall
promptly notify each Bank of the contents of each Notice of Money Market
Borrowing and of such Bank's share (if any) of such Borrowing.
(ii) Not later than 12:00 Noon (New York City time) on the date
of each Money Market Borrowing, each Bank participating therein shall
(except as provided in clause (iii) of this subsection (h)) make
available its share of such Money Market Borrowing, in U.S. Dollars
immediately available in New York City, to the Administrative Agent at
its address specified in or pursuant to Section 10.01. Unless the
Administrative Agent determines that any applicable condition specified
in Article III has not been satisfied, the Administrative Agent will make
the funds so received from the Banks available to the Company (for the
account of the applicable Borrower) at the Administrative Agent's
aforesaid address.
(iii) If any Bank makes a new Money Market Loan hereunder on a day
on which any Borrower is to repay all or any part of an outstanding Loan
from such Bank, such Bank shall apply the proceeds of its new Money
Market Loan to make such repayment, and only an amount equal to the
difference (if any) between the amount being borrowed and the amount
being repaid shall be made available by such Bank to the Administrative
Agent as provided in clause (ii) of this subsection (h) or remitted by
the applicable Borrower to the Administrative Agent as provided in
Section 2.12, as the case may be, and if such Loans are to different
Borrowers the Company shall cause appropriate payments to be made between
such Borrowers to reflect the foregoing.
(iv) Unless the Administrative Agent shall have received notice
from a Bank prior to the date of any Money Market Borrowing that such
Bank will not make available to the Administrative
<PAGE>
<PAGE> 21
20
Agent such Bank's share of such Borrowing, the Administrative Agent may
assume that such Bank has made such share available to the Administrative
Agent on the date of such Borrowing in accordance with the preceding
clauses (ii) and (iii) of this subsection (h) and the Administrative
Agent may, in reliance upon such assumption, make available to the
Company (for the account of the applicable Borrower) on such date a
corresponding amount. If and to the extent that such Bank shall not have
so made such share available to the Administrative Agent, such Bank and
the Company (for the account of the applicable Borrower) severally agree
to repay to the Administrative Agent forthwith on demand such
corresponding amount together with interest thereon, for each day from
the date such amount is made available to the Company until the date such
amount is repaid to the Administrative Agent, at (A) in the case of the
Company, a rate per annum equal to the higher of the Federal Funds Rate
and the interest rate applicable thereto pursuant to Section 2.08 and (B)
in the case of such Bank, the Federal Funds Rate. If such Bank shall
repay to the Administrative Agent such corresponding amount, such amount
so repaid shall constitute such Bank's Loan included in such Borrowing
for purposes of this Agreement.
Section 2.05. Negotiated Rate Loans. During the Revolving Credit
---------------------
Period, the Company may make arrangements with one or more of the Banks for
Negotiated Rate Loans to be made by such Bank or Banks, to such Borrowers, at
such interest rates, in such currency or currencies and on such other terms
and conditions as may be agreed upon between the Company and such Bank or
Banks; provided, however, that the Company shall not borrow or permit any
-------- -------
Eligible Subsidiary to borrow any Negotiated Rate Loan in an amount that
would result in the aggregate principal amount of the outstanding Loans
exceeding the Total Commitment (after giving effect to all borrowings and
repayments of Loans then being made). The Company shall promptly notify the
Administrative Agent of the making of any such Negotiated Rate Loan, the
aggregate principal amount thereof, the Interest Period applicable thereto,
the currency or currencies in which such loan is denominated (if other than
U.S. Dollars) and of any prepayment or repayment thereof. In addition, any
Bank that makes a Negotiated Rate Loan to any Borrower in a currency other
than U.S. Dollars shall promptly notify the Administrative Agent of the U.S.
Dollar equivalent of such Negotiated Rate Loan (as determined by such Bank
based upon its spot buying rate), and the U.S. Dollar equivalent amount so
determined and notified to the Administrative Agent shall thereafter be
utilized for purposes of determining the amount of unused Commitments. Each
such Negotiated Rate Loan shall be in the principal amount of $1,000,000 (or
its equivalent in another currency) or a larger multiple thereof (or its
equivalent in another currency).
Section 2.06. Evidence of Debt. (a) Each Bank shall maintain in
----------------
accordance with its usual practice records evidencing the indebtedness of
each Borrower to such Bank resulting from each Loan made by such Bank,
including the amounts of principal and interest payable and paid to such Bank
from time to time hereunder.
(b) The Administrative Agent shall maintain records in which it
shall record (i)the amount of each Loan made hereunder and each Interest
Period therefor, (ii)the amount of any principal or interest due and payable
or to become due and payable from each Borrower to each Bank hereunder and
(iii)the amount of any sum received by the Administrative Agent
<PAGE>
<PAGE> 22
21
hereunder for account of the Banks and each Bank's share thereof.
(c) The entries made in the records maintained pursuant to
subsection(a) or(b) of this Section shall be prima facie evidence of the
existence and amounts of the obligations recorded therein; provided that the
--------
failure of any Bank or the Administrative Agent to maintain such records or
any error therein shall not in any manner affect the obligation of any
Borrower to repay the Loans in accordance with the terms of this Agreement.
(d) Any Bank may request that the Loans of such Bank to any Borrower
be evidenced by a single Note payable by such Borrower to the order of such
Bank for the account of its applicable Lending Office in an amount equal to
the aggregate unpaid principal amount of such Bank's Loans. In such event,
such Borrower shall prepare, execute and deliver to such Bank a Note payable
to such Bank (or, if requested by such Bank, to such Bank and its registered
assigns). Thereafter, the Loans evidenced by such Note and interest thereon
shall at all times (including after assignment pursuant to Section 10.06) be
represented by one or more Notes in such form payable to the payee named
therein (or, if such Note is a registered note, to such payee and its
registered assigns).
Section 2.07. Maturity of Loans. Each Loan included in any
-----------------
Borrowing shall mature, and the principal amount thereof shall be due and
payable, on the last day of the Interest Period applicable to such Borrowing
(such last day being referred to in this Agreement as the "Maturity Date" of
-------------
each such Loan).
Section 2.08. Interest Rates. (a) Each Base Rate Loan shall bear
--------------
interest on the outstanding principal amount thereof, for each day from the
date such Loan is made until it becomes due, at a rate per annum equal to the
Base Rate for such day. Such interest shall be payable for each Interest
Period on the last day thereof and, if such Interest Period is longer than
three months, at intervals of three months after the first day thereof. Any
overdue principal of and overdue interest on any Base Rate Loan and all other
amounts hereunder not paid when due (other than principal and interest on
Loans subject to subsections (b), (c) and (d) of this Section) shall bear
interest, payable on demand, for each day until paid at a rate per annum
equal to the sum of 1% plus the rate otherwise applicable to Base Rate Loans
for such day.
(b) Each CD Loan shall bear interest on the outstanding principal
amount thereof, for each Interest Period applicable thereto, at a rate per
annum equal to the sum of the CD Margin plus the Adjusted CD Rate in respect
of such Interest Period. Such interest shall be payable for each Interest
Period on the last day thereof and, if such Interest Period is longer than
90 days, at intervals of 90 days after the first day thereof. Any overdue
principal of or overdue interest on any CD Loan shall bear interest, payable
on demand, for each day until paid at a rate per annum equal to the sum of 1%
plus the rate applicable to Base Rate Loans for such day.
"CD Margin" applicable to any CD Loan outstanding on any day means
---------
(i) if such day falls within a Level I Pricing Period, 0.240% and (ii) if
such day falls within a Level II Pricing Period, 0.375%. The CD Margin shall
be adjusted automatically on and as of the effective date of any change
between Pricing Periods, as provided in Section 2.16.
<PAGE>
<PAGE> 23
22
The "Adjusted CD Rate" applicable to any Interest Period means a
----------------
rate per annum determined pursuant to the following formula:
ACDR [ CDBR ] */
-
[---------------] + AR
[ 1.00 - CDRP ]
ACDR = Adjusted CD Rate for such Interest Period
CDBR = CD Base Rate for such Interest Period
CDRP = CD Reserve Percentage
AR = Assessment Rate
[FN]
- -----------------------------
*/ The amount in brackets being rounded upward, if necessary, to the
-
next higher 1/100 of 1%.
</FN>
The "CD Base Rate" means for any Interest Period the average per
------------
annum rate of interest (rounded upward, if necessary, to the next higher
1/100 of 1%) bid at 10:00 A.M. (New York City time) (or as soon thereafter as
it may be practicable to determine) on the first day of such Interest Period
by two or more New York certificate of deposit dealers of recognized standing
(as reported by each Reference Bank to the Administrative Agent) for the
purchase at face value from each Reference Bank of its certificates of
deposit in an amount comparable to the principal amount of the CD Loan of
such Reference Bank to which such Interest Period applies and with a maturity
comparable to such Interest Period.
"CD Reserve Percentage" means for any day that percentage (expressed
---------------------
as a decimal) which is in effect on such day as prescribed by the Board of
Governors of the Federal Reserve System (or any successor) for determining
the maximum reserve requirement (including, without limitation, any basic,
supplemental or emergency reserves) for a member bank of the Federal Reserve
System in New York City with deposits exceeding five billion U.S. Dollars in
respect of new non-personal time deposits in U.S. Dollars in New York City
having a maturity comparable to the related Interest Period and in an amount
of $100,000 or more. The Adjusted CD Rate shall be adjusted automatically on
and as of the effective date of each change in the CD Reserve Percentage.
"Assessment Rate" means for any Interest Period the net annual
---------------
assessment rate (rounded upward, if necessary, to the next higher 1/100 of
1%) actually incurred by the Person serving as the Administrative Agent to
the Federal Deposit Insurance Corporation (or any successor) for such
Corporation's (or such successor's) insuring time deposits at the offices of
the Person serving as the Administrative Agent in the United States during
the most recent period for which such rate has been determined prior to the
commencement of such Interest Period.
(c) Each Euro-Dollar Loan shall bear interest on the outstanding
principal amount thereof, for each Interest Period applicable thereto, at a
rate per annum equal to the sum of the Euro-Dollar Margin plus the Adjusted
LIBO Rate in respect of such Interest Period. Such
<PAGE>
<PAGE> 24
23
interest shall be payable for each Interest Period on the last day thereof
and, if such Interest Period is longer than three months, at intervals of
three months after the first day thereof.
The "Euro-Dollar Margin" applicable to any Euro-Dollar Loan
------------------
outstanding on any day means (i) if such day falls within a Level I Pricing
Period, 0.115% and (ii) if such day falls within a Level II Pricing Period,
0.250%. The Euro-Dollar Margin shall be adjusted automatically on and as of
the effective date of any change between Pricing Periods, as provided in
Section 2.16.
The "Adjusted LIBO Rate" applicable to any Interest Period means a
------------------
rate per annum equal to the quotient (rounded upwards, if necessary, to the
next higher 1/100 of 1%) obtained by dividing (i) the LIBO Rate in respect of
such Interest Period by (ii) 1.00 minus the Euro-Dollar Reserve Percentage.
The "LIBO Rate" means, for the Interest Period for any Euro-Dollar
---------
Borrowing, the rate appearing on Page 3750 of the Telerate Service (or on any
successor or substitute page of such Service, or any successor to or
substitute for such Service, providing rate quotations comparable to those
currently provided on such page of such Service, as determined by the
Administrative Agent from time to time for purposes of providing quotations
of interest rates applicable to U.S. Dollar deposits in the London interbank
market) at approximately 11:00 A.M., London time, two Euro-Dollar Business
Days prior to the commencement of such Interest Period, as the rate for the
offering of U.S. Dollar deposits with a maturity comparable to such Interest
Period. In the event that such rate is not available at such time for any
reason, then the LIBO Rate for such Interest Period shall be the rate at
which U.S. Dollar deposits of $10,000,000 and for a maturity comparable to
such Interest Period are offered by the principal London office of the Person
serving as the Administrative Agent in immediately available funds in the
London interbank market at approximately 11:00 A.M., London time, two
Euro-Dollar Business Days prior to the commencement of such Interest Period.
The "Euro-Dollar Reserve Percentage" means for any day that
------------------------------
percentage (expressed as a decimal) which is in effect on such day as
prescribed by the Board of Governors of the Federal Reserve System (or any
successor) for determining the maximum reserve requirement for a member bank
of the Federal Reserve System in New York City with deposits exceeding five
billion U.S. Dollars in respect of "Eurocurrency liabilities" (as such
liabilities are referred to in Regulation D of the Board of Governors of the
Federal Reserve System) (or in respect of any other category of liabilities
which includes deposits by reference to which the interest rate on
Euro-Dollar Loans is determined or any category of extensions of credit or
other assets which includes loans by a non-United States office of such a
bank to United States residents). The Adjusted LIBO Rate shall be adjusted
automatically on and as of the effective date of each change in the
Euro-Dollar Reserve Percentage.
(d) Any overdue principal of or overdue interest on any Euro-Dollar
Loan shall bear interest, payable on demand, for each day until paid, at a
rate per annum equal to (i) the sum of 1% plus the rate otherwise applicable
to such Euro-Dollar Loan or (ii) if the circumstances described in subsection
(a) or (b) of Section 8.01 shall exist, the sum of 1% plus the rate
<PAGE>
<PAGE> 25
24
applicable to Base Rate Loans for such day.
(e) Subject to Section 8.01(a), each Money Market LIBOR Loan shall
bear interest on the outstanding principal amount thereof, for the Interest
Period applicable thereto, at a rate per annum equal to the sum of the LIBO
Rate for such Interest Period (determined in accordance with Section 2.08(c)
as if the related Money Market LIBOR Borrowing were a Euro-Dollar Borrowing)
plus (or minus) the Money Market Margin quoted by the Bank making such Loan
in accordance with Section 2.04. Each Money Market Absolute Rate Loan shall
bear interest on the outstanding principal amount thereof, for the Interest
Period applicable thereto, at a rate per annum equal to the Money Market
Absolute Rate quoted by the Bank making such Loan in accordance with Section
2.04. Such interest shall be payable for each Interest Period on the last
day thereof and, if such Interest Period is longer than three months, at
intervals of three months after the first day thereof. Any overdue principal
of or overdue interest on any Money Market Loan shall bear interest, payable
on demand, for each day until paid at a rate per annum equal to the sum of 1%
plus the rate applicable to Base Rate Loans for such day.
(f) The Administrative Agent shall determine each interest rate
applicable to the Loans hereunder (other than interest rates applicable to
Negotiated Rate Loans). The Administrative Agent shall give prompt notice to
the Company and the participating Banks by telecopier of each interest rate
so determined, and its determination thereof shall be conclusive in the
absence of manifest error. If the Company is not the Borrower of the
applicable Loan for which such interest rate is so determined, the Company
will be responsible for notifying the applicable Borrower of such interest
rate.
(g) Each Reference Bank agrees to use its best efforts to furnish
quotations to the Administrative Agent as contemplated hereby. If any
Reference Bank does not furnish a timely quotation, the Administrative Agent
shall determine the relevant interest rate on the basis of the quotation or
quotations furnished by the remaining Reference Bank or Reference Banks or,
if none of such quotations is available on a timely basis, the provisions of
Section 8.01 shall apply.
Section 2.09. Fees. (a) Facility Fee. The Company shall pay to the
---- ------------
Administrative Agent, for the account of each Bank, facility fees for each
day during the Revolving Credit Period, at a rate equal to (a) if such day
falls within a Level I Pricing Period, 0.060% per annum or (b) if such day
falls within a Level II Pricing Period, 0.125% per annum, in each case of
such Bank's Commitment (whether used or unused) for such day. Such facility
fees shall be payable quarterly in arrears on each March 31, June 30,
September 30 and December 31 and on the Termination Date.
(b) Utilization Fee. The Company shall pay to the Administrative
---------------
Agent, for the account of each Bank, a utilization fee at a rate equal to
0.075% per annum on the amount of the outstanding Loans of such Bank for each
day that the aggregate principal amount of outstanding Loans (other than
Money Market Loans and Negotiated Rate Loans) hereunder shall exceed 50% of
the aggregate Commitments. Such utilization fees shall be payable quarterly
in arrears on each March 31, June 30, September 30 and December 31 and on the
Termination Date.
Section 2.10. Termination and Reduction of Commitments. (a) The
----------------------------------------
Company
<PAGE>
<PAGE> 26
25
may, upon at least three Domestic Business Days' notice to the Administrative
Agent, terminate entirely at any time, or reduce from time to time by an
aggregate amount of $25,000,000 or any larger multiple of $5,000,000, the
Total Commitment in excess of the outstanding aggregate principal amount of
the Loans. Each reduction of the Total Commitment shall reduce the unused
Commitments of the Banks in proportion to their respective Commitments and
shall be permanent. If the Total Commitment is terminated in its entirety,
all accrued facility and utilization fees shall be payable on the effective
date of such termination.
(b) The Total Commitment (unless already terminated pursuant to
subsection (a) of this Section) shall terminate on the Termination Date, and
any Loans then outstanding (together with accrued interest thereon) shall be
due and payable on such date.
Section 2.11. Optional Prepayments. (a) Any Borrower may, upon
--------------------
notice by the Company (on behalf of such Borrower) to the Administrative
Agent received by the Administrative Agent not later than 10:00 A.M. (New
York City time) on the Domestic Business Day prior to the date of prepayment,
prepay, without penalty or premium, any Base Rate Borrowing (or any Money
Market Borrowing bearing interest at the Base Rate pursuant to Section
8.01(a)) in whole at any time, or from time to time in part in principal
amounts aggregating $10,000,000 or any larger multiple of $1,000,000, by
paying the principal amount to be prepaid together with accrued interest on
such prepaid amounts to the date of prepayment. Each such optional
prepayment shall be applied to prepay ratably the Loans of the several Banks
included in such Borrowing.
(b) Subject to Section 2.13, any Borrower may upon at least three
Euro-Dollar Business Days' notice by the Company (on behalf of such Borrower)
to the Administrative Agent, prepay any CD Borrowing or Euro-Dollar Borrowing
in whole at any time, or from time to time in part in principal amounts
aggregating $10,000,000 or any larger multiple of $1,000,000, by paying the
principal amount to be prepaid together with accrued interest on such prepaid
amounts to the date of prepayment. Each such optional prepayment shall be
applied to prepay ratably the Loans of the several Banks included in such
Borrowing.
(c) Each such notice of prepayment shall specify which outstanding
Borrowing (or portion thereof) is to be prepaid in connection therewith.
Upon receipt of a notice of prepayment pursuant to this Section, the
Administrative Agent shall promptly notify each Bank of the contents thereof
and of such Bank's ratable share of such prepayment, and such notice shall
not thereafter be revocable by the Company or the applicable Borrower.
(d) Money Market Loans (except such as bear interest at the Base
Rate pursuant to Section 8.01(a)) and Negotiated Rate Loans of any Bank may
not be prepaid without the consent of such Bank.
Section 2.12. General Provisions as to Payments. (a) Each Borrower
---------------------------------
shall make each payment of principal of, and interest on, its Syndicated
Loans and Money Market Loans and the Company shall make each payment of
facility and utilization fees and all other amounts payable hereunder (other
than Negotiated Rate Loans), not later than 11:00 A.M. (New York City time)
on the date when due, in U.S. Dollars immediately available in New York City,
to the
<PAGE>
<PAGE> 27
26
Administrative Agent at its address referred to in Section 10.01. The
Administrative Agent will promptly distribute to each Bank its ratable share
of each such payment received by the Administrative Agent for the account of
the Banks. Each Borrower shall make each payment of principal of, and
interest on, its Negotiated Rate Loans, not later than 11:00 A.M. (local time
at the relevant Domestic Lending Office) on the date when due, to the Bank
which made such Loan at its Domestic Lending Office, in U.S. Dollars
immediately available in the city in which such Bank's Domestic Lending
Office is located; provided that all payments of principal of and interest on
--------
any Negotiated Rate Loan that is denominated in a currency other than U.S.
Dollars shall be payable in the currency in which such Negotiated Rate Loan
is denominated and at such location as agreed between the Company and such
Bank. Whenever any payment of principal of, or interest on, or the Domestic
Loans or any payment of facility and utilization fees shall be due on a day
which is not a Domestic Business Day, the date for payment thereof shall be
extended to the next succeeding Domestic Business Day. Whenever any payment
of principal of, or interest on, the Euro-Dollar Loans shall be due on a day
which is not a Euro-Dollar Business Day, the date for payment thereof shall
be extended to the next succeeding Euro-Dollar Business Day unless as a
result thereof it would fall in the next calendar month, in which case such
date for payment shall be advanced to the next preceding Euro-Dollar Business
Day. Whenever any payment of principal of, or interest on, the Money Market
Loans shall be due on a day which is not a Euro-Dollar Business Day, the date
for payment thereof shall be extended to the next succeeding Euro-Dollar
Business Day. If the date for any payment of principal is extended by
operation of law or this Section or otherwise, interest thereon shall be
payable for such extended time at the rate in effect on the initial date for
payment. All payments hereunder shall be made without any deduction
whatsoever (other than for any Tax subject to the provisions of Section
2.15), including, but not limited to, any deduction for any set-off,
recoupment or counterclaim.
(b) Unless the Administrative Agent shall have received notice from
the Company prior to the date on which any payment is due to the Banks
hereunder that the Company or the applicable Borrower, as the case may be,
will not make such payment in full, the Administrative Agent may assume that
the Company or such Borrower, as applicable, has made such payment in full to
the Administrative Agent on such date and the Administrative Agent may, in
reliance upon such assumption, cause to be distributed to each Bank on such
due date an amount equal to the amount then due such Bank. If and to the
extent that the Company or such Borrower, as applicable shall not have so
made such payment, each Bank shall repay to the Administrative Agent
forthwith on demand such amount distributed to such Bank together with
interest thereon, for each day from the date such amount is distributed to
such Bank until the date such Bank repays such amount to the Administrative
Agent, at the Federal Funds Rate.
Section 2.13. Funding Losses. If any Borrower makes any payment of
--------------
principal with respect to any Fixed Rate Loan (pursuant to Section 2.11,
2.15, Article VI, Article VIII or otherwise) on any day other than the last
day of an Interest Period applicable thereto, or if any Borrower fails to
borrow any Fixed Rate Loan after a Notice of Borrowing has been given to the
Administrative Agent in accordance with Section 2.03 or 2.04, such Borrower
shall reimburse each Bank on demand for any resulting loss or expense
incurred by it, including (without limitation) any loss incurred in
obtaining, liquidating or employing deposits from third parties, but
excluding loss of margin for the period after any such payment; provided
--------
that such Bank
<PAGE>
<PAGE> 28
27
shall have delivered to the Company (as the agent for such Borrower) a
certificate as to the amount of such loss or expense, which certificate shall
be conclusive in the absence of manifest error. Upon the request of the
Company (on behalf of any Borrower), a Bank claiming reimbursement for any
such loss or expense under this Section shall provide to the Company
additional information with respect to the determination of such loss or
expense. In determining any such lose or expense, such Bank may use any
reasonable averaging and attribution methods.
Section 2.14. Computation of Interest and Fees. Interest on
--------------------------------
Negotiated Rate Loans (unless the Company and the Bank making such Loan shall
specifically agree otherwise), interest based on the Prime Rate hereunder and
all facility fees hereunder shall be computed on the basis of a year of 365
days (or 366 days in a leap year) and paid for the actual number of days
elapsed (including the first day but excluding the last day). All other
interest and all utilization fees shall be computed on the basis of a year of
360 days and paid for the actual number of days elapsed (including the first
day but excluding the last day).
Section 2.15. Taxes. (a) All payments in respect of principal,
-----
interest, fees and other amounts due hereunder shall be made to each Bank
free and clear of, and without deduction for, any and all present and future
taxes, levies, imposts, deductions, charges, withholdings, and all
liabilities with respect thereto, excluding liabilities of such Bank to pay
directly income and franchise taxes of (i) the United States and the
jurisdiction under the laws of which such Bank is organized, (ii) the
jurisdiction of such Bank's Lending Office and (iii) any political
subdivision or taxing authority thereof or therein (all such non-excluded
taxes, levies, imposts, deductions, charges, withholdings and liabilities
being hereinafter referred to as "Non-excluded Taxes"). If the Company or
------------------
any Borrower shall be required by this Agreement to deduct any Non-excluded
Taxes from or in respect of any sum payable hereunder to a Bank or the
Administrative Agent, the sum payable shall be increased so that, after
making all required deductions (including deductions applicable to additional
sums payable under this Section), such Bank or the Administrative Agent shall
receive an amount equal to the sum it would have received had no such
deductions been made.
(b) In addition, the Company and each Borrower will deduct and pay
Non-excluded Taxes and taxes of all jurisdictions with respect to any amounts
paid under this subsection (b). If any Non-excluded Taxes or any taxes
mentioned in this subsection (b) are paid by any Bank or the Administrative
Agent, the Company or the applicable Borrower, as the case may be, will, upon
demand of such Bank (with a copy of such demand to the Administrative Agent)
or the Administrative Agent and whether or not such Non-excluded Taxes or
taxes shall be correctly or legally asserted, indemnify such Bank or the
Administrative Agent (as the case may be) for such payments, together with
any interest, penalties and expenses in connection therewith; provided that
--------
no payment of such Non-excluded Taxes or other taxes shall be made by any
Bank or the Administrative Agent without prior notice to the Company.
(c) Each Bank acknowledges that on the date hereof there is no
applicable requirement that any withholding, deduction or payment be made in
respect of Non-excluded Taxes from payments of interest on the Loans, or
other amounts payable under this Agreement. In the event any such Bank shall
become aware that any withholding, deduction or payment is
<PAGE>
<PAGE> 29
28
required with respect to such Non-excluded Taxes, such Bank shall notify the
Company as soon as reasonably practicable but in any event within 45 days of
the date it shall have become aware of such required withholding, deduction
or payment and provide the Company with reasonable detail concerning such
required withholding, deduction or payment. Each Bank agrees that, if
necessary in order to avoid such deduction from time to time, it will avail
itself, to the extent it may lawfully do so without incurring additional
expense, of any double tax conventions with the United States under which
such amounts would be receivable by such Bank without such deduction. In
addition, each Bank agrees that, if any Non-excluded Tax or tax in respect of
which the Company or a Borrower is or would be liable under this Section
shall be imposed or increased in respect of any Syndicated Loan (other than a
Base Rate Loan) by such Bank by virtue of any change in law or otherwise
subsequent to the making of such Loan, the applicable Borrower shall be
entitled to prepay such Loan, together with accrued interest thereon to the
date of payment, upon at least three Euro-Dollar Business Days' notice to
such Bank (with a copy of such notice to the Administrative Agent); in such
event, such Bank shall make a Base Rate Loan to such Borrower in an amount
equal to the amount of such prepayment on the date of such prepayment.
(d) Each Bank agrees that it will file with the appropriate
authorities in the United States such letters, notices and documents as may
reasonably be required to enable the Borrowers to pay interest hereunder
without deduction in respect of United States Federal withholding taxes.
(e) In the event that either the Company or a Borrower or the
Administrative Agent or a Bank pays any Non-excluded Tax or tax of the
character described in Section 2.15(b), such Person shall, promptly after the
making of such payment, notify the Person for the account of which such
payment was made hereunder and shall forward to such Person the receipt (or a
certified copy thereof) in respect of such payment promptly after receiving
it. In the event the Company or a Borrower pays, or reimburses the
Administrative Agent or any Bank for paying, any Non-excluded Tax or tax of
the character described in Section 2.15(b), and a refund of any such payment
(or portion thereof) is received by the Administrative Agent or any Bank,
such Person shall remit the refund to the Company for the account of the
applicable Borrower.
(f) Neither the Company nor any Borrower shall be required to make
any additional payment pursuant to this Section in respect of any
Non-excluded Taxes or other taxes which could be avoided by any Bank or the
Administrative Agent in the exercise of reasonable diligence (consistent with
legal and regulatory restrictions), including a change in the Euro-Dollar
Lending Office or Money Market Lending Office of such Bank or the
Administrative Agent if not otherwise disadvantageous to such Bank or the
Administrative Agent.
(g) Each Bank shall promptly notify the Company of any change in its
Euro-Dollar Lending Office or Money Market Lending Office. In the event any
Bank so changes its Lending Office, such Bank shall not be entitled to
receive any payment in respect of Non-excluded Taxes or other taxes under
this Section to the extent the amount of such payment on the date of such
change in its Lending Office exceeds the amount such Bank would have been
entitled to receive on such date under this Section had no such change in
Lending Office been
<PAGE>
<PAGE> 30
29
made, unless such change in Lending Office was made at the request of the
Company.
Section 2.16. Pricing Periods. (a) Subject to subsection (b) of
---------------
this Section, "Level I Pricing Period" means any period during which Index
----------------------
Debt shall be rated BBB+ or better by S&P or Baa1 or better by Moody's, and
"Level II Pricing Period" means any period that is not a Level I Pricing
-----------------------
Period. "Pricing Period" means a Level I Pricing Period or a Level II
--------------
Pricing Period.
(b) For purposes of the foregoing definitions, if any rating for
Index Debt established by Moody's or S&P shall be changed (other than as a
result of a change in the rating system of Moody's or S&P), such change shall
be effective, for purposes of the preceding subsection (a), as of the date on
which it is first announced by the applicable rating agency. If the rating
system of Moody's or S&P shall change, (i) the Company and the Banks shall
negotiate in good faith to amend the reference to the affected rating in the
preceding subsection (a) to reflect such changed rating system and (ii) until
the effectiveness of such amendment, the applicable Pricing Period shall be
determined solely by reference to the unaffected rating (if any) of Index
Debt.
Section 2.17. Eligible Subsidiaries. The Company may from time to
---------------------
time cause any wholly-owned Consolidated Subsidiary to become an Eligible
Subsidiary eligible to borrow Loans hereunder by delivering to the
Administrative Agent an Election to Participate, substantially in the form of
Exhibit K hereto, with respect to such Subsidiary. The eligibility of any
such Subsidiary as an Eligible Subsidiary shall terminate when the
Administrative Agent receives a Notice of Termination, substantially in the
form of Exhibit L hereto, with respect to such Subsidiary. Each Election to
Participate delivered to the Administrative Agent shall be duly executed on
behalf of the relevant Subsidiary and the Company, and each Election to
Terminate delivered to the Administrative Agent shall be duly executed on
behalf of the Company, in such number of copies as the Administrative Agent
may request. The delivery of an Election to Terminate shall not affect any
obligation of the relevant Subsidiary theretofore incurred but on and after
the effective date of such Election to Terminate such Subsidiary shall have
no liability hereunder other than with respect to Loans made to such
Subsidiary prior to such date. The Administrative Agent shall promptly give
notice to the Banks of its receipt of any Election to Participate or Election
to Terminate.
ARTICLE III
CONDITIONS TO BORROWINGS
The effectiveness of this Agreement and the obligation of each Bank
to make a Loan on the occasion of each Borrowing pursuant to Article II is
subject to the satisfaction of the following conditions, an applicable:
Section 3.01. (a) Syndicated Borrowings. In the case of each
---------------------
Syndicated Borrowing hereunder:
(i) receipt by the Administrative Agent of a Notice of Borrowing
as required by
<PAGE>
<PAGE> 31
30
Section 2.03;
(ii) the fact that, immediately prior to such Borrowing, no Default
(or, in the case of a Refunding Borrowing, no Default which has resulted
in the Loans being declared due and payable) shall have occurred and be
continuing;
(iii) the fact that, immediately after such Borrowing and after
giving effect to the amount of such Borrowing and the use of the proceeds
thereof, no Default resulting from such Borrowing or such use of proceeds
would occur and the aggregate outstanding principal amount of the Loans
will not exceed the Total Commitment; and
(iv) the fact that the representations and warranties contained in
this Agreement (except the representations and warranties contained in
Sections 4.01(d)(iii), 4.01(e), 4.01(f), 4.01(g) and 4.01(l)) shall be
true on and as of the date of such Borrowing with the same force and
effect as if made on and as of such date, except to the extent that any
such representation or warranty in Section 4.01(d)(i) or (ii) or Section
4.01(k) is made in respect of a specified date or a specified period of
time in which case such representation or warranty shall continue to be
true in respect of the specified date or the specified period of time.
(b) Money Market Borrowings. In the case of each Money Market
-----------------------
Borrowing hereunder:
(i) receipt by the Administrative Agent of a Notice of Borrowing
as required by Section 2.04;
(ii) the fact that, immediately prior to such Borrowing, no Default
shall have occurred and be continuing;
(iii) the fact that, immediately after such Borrowing and after
giving effect to the amount of such Borrowing and the use of proceeds
thereof, no Default would occur and be continuing and the aggregate
outstanding principal amount of the Loans would not exceed the Total
Commitment; and
(iv) the fact that the representations and warranties contained
in this Agreement (except the representations and warranties contained
in Sections 4.01(d)(iii), 4.01(e), 4.01(f), 4.01(g) and 4.01(l)) shall
be true on and as of the date of such Borrowing with the same force and
effect as if made on and as of such date, except to the extent that any
such representation or warranty in Section 4.01(d)(i) or (ii) or Section
4.01(k) is made in respect of a specified date or a specified period of
time in which case such representation or warranty shall continue to be
true in respect of the specified date or the specified period of time.
Each Borrowing hereunder shall be deemed to be a representation and warranty
by the Company on the date of such Borrowing as to the facts specified in
clauses (ii), (iii) and (iv) of subsection (a) or (b), as applicable, of this
Section.
<PAGE>
<PAGE> 32
31
Section 3.02. Effectiveness. In the case of the effectiveness of
-------------
this Agreement:
(a) receipt by the Administrative Agent of an opinion of Thomas
Larson, Esq., Associate General Counsel of the Company, substantially in the
form of Exhibit F hereto and covering such additional matters relating to the
transactions contemplated hereby as the Required Banks shall have reasonably
requested;
(b) receipt by the Administrative Agent of an opinion of Milbank,
Tweed, Hadley & McCloy LLP, special New York counsel to Chase, substantially
in the form of Exhibit G hereto and covering such additional matters relating
to the transactions contemplated hereby as the Required Banks shall have
reasonably requested;
(c) receipt by the Administrative Agent of a certificate, signed
by any two of the Treasurer, an Assistant Treasurer, the Controller, an
Assistant Controller and a Vice President of the Company, to the effect that
no Default has occurred and is continuing (or would result from any Loans
being made on the Effective Date) and that the representations and warranties
contained in this Agreement are true on and as of the Effective Date with the
same effect as though made on the Effective Date;
(d) receipt by the Administrative Agent of all documents it may
reasonably request relating to the existence and good corporate standing of
the Company and ABI, the corporate authority for, the due authorization and
execution of and the validity of this Agreement and the Guaranty Fee
Agreement, and any other matters relevant hereto, all in form and substance
satisfactory to the Administrative Agent;
(e) receipt by the Administrative Agent of a fully executed copy of
the Guaranty Fee Agreement in the form of Exhibit J hereto;
(f) the Company shall have terminated all lending commitments under,
and shall have paid in full any outstanding loans (together with accrued
interest thereon), accrued fees and other amounts payable under, the Credit
Agreement dated as of December 15, 1994, among the Company, ABI, the banks
party thereto and the agent named therein, as such Credit Agreement has been
amended, supplemented or otherwise is in effect immediately prior to the
effectiveness of this Agreement;
(g) receipt by the Administrative Agent, for its account and the
account of the Banks or the Lead Arranger specified on the cover page of
this Agreement, as the case may be, of all fees required to be paid, and
all expenses required to be paid or reimbursed for which invoices have been
presented (including the reasonable fees and expenses of legal counsel), on
or before the Effective Date; and
(h) receipt by the Administrative Agent of all such other documents
and opinions as the Required Banks or the Administrative Agent shall request,
in each case, in form and substance satisfactory to the Required Banks or the
Administrative Agent, as the case may be.
The opinions referred to in subsections (a) and (b) of this Section and the
certificate referred to in
<PAGE>
<PAGE> 33
32
subsection (c) of this Section shall be dated the Effective Date. The
Administrative Agent shall promptly notify the Company and the Banks of
the Effective Date, and such notice shall be conclusive and binding on all
parties hereto.
Section 3.03. Negotiated Rate Borrowings. Each Borrowing of a
--------------------------
Negotiated Rate Loan shall be subject to such conditions as the Company (on
behalf of the applicable Borrower) and the Bank making such Negotiated Rate
Loan may agree and, unless the Company and such Bank shall specifically agree
otherwise, to the conditions set forth in clauses (ii), (iii) and (iv) of
Section 3.01(b).
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
Section 4.01. Representations and Warranties of the Company and ABI.
-----------------------------------------------------
The Company and (so long as the ABI Guarantee shall be in effect) ABI jointly
and severally represent and warrant to the Banks and the Administrative Agent
that:
(a) Corporate Existence and Power. The Company and ABI are
-----------------------------
corporations duly incorporated, validly existing and in good standing under
the laws of the State of Delaware and the State of Missouri, respectively,
and each has all corporate powers and authority and all material governmental
licenses, authorizations, consents and approvals required to carry on its
business as now conducted.
(b) Corporate and Governmental Authorization; Contravention. The
-------------------------------------------------------
execution, delivery and performance by the Company of this Agreement and the
Guaranty Fee Agreement, and by ABI of this Agreement and the Guaranty Fee
Agreement, are within the corporate powers of each of the Company and ABI,
have been duly authorized by all necessary corporate action on the part of
the Company and ABI, require no action by or in respect of, or filing with,
any governmental body, agency or official, do not contravene, or constitute a
default under, any provision of any applicable law or regulation or of the
Certificate of Incorporation or By-Laws of the Company or the Articles of
Incorporation or By-Laws of ABI or of any agreement, judgment, injunction,
order, decree or other instrument binding on the Company or ABI, and will not
result in the creation or imposition of any Lien on any asset of the Company
or any of its Subsidiaries.
(c) Binding Effect. Each of this Agreement and the Guaranty Fee
--------------
Agreement constitutes a valid and binding agreement of each of the Company
and ABI, enforceable in accordance with their respective terms.
(d) Financial Information. (i) The consolidated balance sheet of
---------------------
the Company and its Consolidated Subsidiaries as of December 31, 1999,
and the related consolidated statements of income, changes in
shareholders equity and cash flows for the fiscal year then ended,
reported on by PricewaterhouseCoopers LLP and set forth in the Company's
1999 Form 10-K, a copy of which has been delivered to each of the Banks,
fairly present, in conformity with generally accepted accounting
principles, the consolidated financial position of the Company and its
Consolidated Subsidiaries as of such date and their
<PAGE>
<PAGE> 34
33
consolidated results of operations and cash flows for such fiscal year.
(ii) The unaudited consolidated balance sheet of the Company and
its Consolidated Subsidiaries as of March 31, 2000, and the related
unaudited consolidated statements of income and cash flows for the three
months then ended, set forth in the Company's quarterly report for the
fiscal quarter ended March 31, 2000, as filed with Securities and
Exchange Commission on Form 10-Q, a copy of which has been delivered to
each of the Banks, fairly present, in conformity with generally accepted
accounting principles applied on a basis consistent with the financial
statements referred to in the preceding clause (i) of this subsection
(d), the consolidated financial position of the Company and its
Consolidated Subsidiaries as of such date and the consolidated results
of operations and cash flows for such three-month period (subject to
normal year-end adjustments).
(iii) Since March 31, 2000, there has been no material adverse
change in the business, financial position or results of operations of
the Company and its Consolidated Subsidiaries, considered as a whole, on
a cumulative basis.
(e) Litigation. There is no action, suit, arbitration or other
----------
proceeding pending against, or to the knowledge of the Company or ABI
threatened against or affecting, the Company or any of its Subsidiaries
before any court or arbitrator or any governmental body, agency or official
in which there is a reasonable possibility of an adverse decision and which
would, if adversely determined, materially and adversely affect the ability
of the Company or ABI to perform its obligations hereunder.
(f) ERISA. As of the date of this Agreement, (i) each member of the
-----
ERISA Group has fulfilled its obligations under the minimum funding standards
of ERISA and the Code with respect to each Plan and is in compliance with the
currently applicable provisions of ERISA and the Code with respect to each
Plan and (ii) no member of the ERISA Group has (A) sought a waiver of the
minimum funding standard under Section 412 of the Code in respect of any
Plan, (B) is in default respecting any contribution or payment to any Plan or
Multiemployer Plan or in respect of any Benefit Arrangement, or has made any
amendment to any Plan or Benefit Arrangement, which has resulted or could
reasonably be expected to result in the imposition of a Lien or the posting
of a bond or other security under ERISA or the Code; or (C) has any
outstanding liability under Title IV of ERISA other than a liability to the
PBGC for premiums under Section 4007 of ERISA, other than any failure to
fulfill such obligations or comply with such provisions (in the case of
clause (i) of this subsection (f)) or any waiver, default or liability (in
the case of clause (ii) of this subsection (f)) that, when taken together
with such other failures, waivers, defaults or liabilities for which
liability is reasonably expected to occur, could reasonably be expected to
result in a material adverse effect on the business, operations or financial
condition of the Company and its Subsidiaries taken as a whole.
(g) Tax Returns and Payment. The Company and its Domestic
-----------------------
Subsidiaries have filed all income tax returns and all other material tax
returns which are required to be filed and have paid all taxes due pursuant
to such returns or pursuant to any assessment received by the
<PAGE>
<PAGE> 35
34
Company or any of its Subsidiaries, except for the filing of such returns, if
any, in respect of which an extension of time for filing is in effect, except
for such taxes, if any, as are being contested in good faith and as to which
adequate reserves have been provided in accordance with generally accepted
accounting principles and except to the extent that such failure to file or
pay does not materially and adversely affect the ability of the Company or
ABI to perform its obligations hereunder. The charges, accruals and reserves
on the books of the Company and each of its Subsidiaries in respect of any
taxes or other governmental charges are, in the opinion of the Company,
adequate.
(h) Ownership of ABI Shares. The Company owns, and will continue
-----------------------
to own, directly or indirectly, all of the outstanding shares of the capital
stock of ABI, free and clear of all Liens, claims and rights of other
Persons.
(i) Not an Investment Company. Neither the Company nor ABI is, nor,
-------------------------
after the use of the proceeds of any Borrowing, will it be, an "investment
company" or a company "controlled" by an "investment company organized or
otherwise created under the laws of the United States or of a State" within
the meaning of the Investment Company Act of 1940, as amended.
(j) Regulations U and X. The execution, delivery and performance
-------------------
of this Agreement in accordance with its terms and the making or borrowing of
the Loans will not violate the provisions of Regulation U or X of the Board
of Governors of the Federal Reserve System. If requested by any Bank, the
Company will furnish to such Bank in connection with any Loan hereunder a
statement in conformity with the requirements of Federal Reserve Form FR U-1
or FR G-3 referred to in said Regulation U.
(k) Unrestricted Subsidiaries. The Subsidiaries listed on Schedule
-------------------------
4.01(k) hereto constitute all of the Unrestricted Subsidiaries as of the date
hereof, except for Subsidiaries the assets and earnings of which, in the
aggregate, do not constitute a material portion of the assets and net
earnings of the Company and its Consolidated Subsidiaries.
(l) Environmental Matters. In the ordinary course of its business,
---------------------
the Company conducts an ongoing review of the effect of Environmental Laws on
the business, operations and properties of the Company and its Domestic
Subsidiaries, in the course of which it identifies and evaluates associated
liabilities and costs (including, without limitation, any capital or
operating expenditures required for clean-up or closure of properties
presently or previously owned, any capital or operating expenditures required
to achieve or maintain compliance with environmental protection standards
imposed by law or as a condition of any license, permit or contract, any
related constraints on operating activities, including any periodic or
permanent shutdown of any facility or reduction in the level of or change in
the nature of operations conducted thereat and any actual or potential
liabilities to third parties, including employees, and any related costs and
expenses). On the basis of this review, the Company has reasonably concluded
that Environmental Laws are unlikely to have a material adverse effect on the
ability of the Company or ABI to perform its obligations hereunder.
Section 4.02. Representations and Warranties of the Eligible
----------------------------------------------
Subsidiaries. The
- ------------
<PAGE>
<PAGE> 36
35
Company and each Eligible Subsidiary shall, by signing and delivering an
Election to Participate, be deemed to represent and warrant to the Banks and
the Administrative Agent that, as of the date of such Election
to Participate:
(a) Corporate Existence and Power. Such Eligible Subsidiary is a
-----------------------------
corporation duly incorporated, validly existing and in good standing under
the laws of its jurisdiction of incorporation and is, and upon each Borrowing
by it hereunder will be, a wholly-owned Consolidated Subsidiary of the
Company.
(b) Corporate and Governmental Authorization; Contravention.
-------------------------------------------------------
The execution and delivery by such Eligible Subsidiary of its Election to
Participate, and the performance by it of this Agreement, are within its
corporate powers, have been duly authorized by all necessary corporate
action, require no action by or in respect of, or filing with, any
governmental body, agency or official and do not contravene, or constitute
a default under, any provision of any applicable law or regulation or of
its Certificate of Incorporation or By-Laws (or comparable organizational
documents) or of any agreement, judgment, injunction, order, decree or other
instrument binding on the Company, ABI or such Eligible Subsidiary, and will
not result in the creation or imposition of any Lien on any asset of the
Company, ABI or any of their respective Subsidiaries. The guarantees by the
Company of the obligations of such Eligible Subsidiary have been duly
authorized by all necessary corporate action, require no action by or in
respect of, or filing with, any governmental body, agency or official and
do not contravene, or constitute a default under, any provision of any
applicable law or regulation or of its Certificate of Incorporation or
By-Laws (or comparable organizational documents) or of any agreement,
judgment, injunction, order, decree or other instrument binding on the
Company, ABI or such Eligible Subsidiary, and will not result in the creation
or imposition of any Lien on any asset of the Company, ABI or any of their
respective Subsidiaries.
(c) Binding Effect. This Agreement constitutes a valid and binding
--------------
agreement of such Eligible Subsidiary, enforceable in accordance with its
terms.
(d) Not an Investment Company. Such Eligible Subsidiary is not,
-------------------------
nor, after the use of the proceeds of any Borrowing, will it be, an
"investment company" or a company "controlled" by an "investment company
organized or otherwise created under the laws of the United States or of a
State" within the meaning of the Investment Company Act of 1940, as amended.
(e) Regulations U and X. The execution and delivery by such
-------------------
Eligible Subsidiary of its Election to Participate, the performance by it of
this Agreement in accordance with its terms and the making or borrowing of
its Loans will not violate the provisions of Regulation U or X of the Board
of Governors of the Federal Reserve System. If requested by any Bank, such
Eligible Subsidiary will furnish to such Bank in connection with any Loan
hereunder a statement in conformity with the requirements of Federal Reserve
Form FR U-1 or FR G-3 referred to in said Regulation U.
ARTICLE V
<PAGE>
<PAGE> 37
36
COVENANTS
Section 5.01. Covenants of the Company. The Company agrees that,
------------------------
so long as any Bank has any Commitment hereunder or any Loan or any other
amount owing hereunder remains unpaid:
(a) Information. The Company will deliver to each of the Banks:
-----------
(i) as soon as available and in any event within 120 days after
the end of each fiscal year of the Company, the consolidated balance
sheet of the Company and its Consolidated Subsidiaries as of the end
of such fiscal year and the related consolidated statements of income,
changes in shareholders equity and cash flows for such fiscal year,
setting forth in each case in comparative form the figures for the
previous fiscal year, all reported on by PricewaterhouseCoopers LLP or
other independent public accountants of nationally recognized standing
and in compliance with the applicable rules and regulations of the
Securities and Exchange commission;
(ii) as soon as available and in any event within 60 days after
the end of each of the first three quarters of each fiscal year of the
Company, the consolidated balance sheet of the Company and its
Consolidated Subsidiaries as of the end of such quarter and the related
consolidated statements of income and cash flows for such quarter and for
the portion of the Company's fiscal year ended at the end of such
quarter, setting forth in each case in comparative form the figures for
the corresponding quarter and the corresponding portion of the Company's
previous fiscal year, all certified (subject to normal year-end
adjustments) as to fairness of presentation, preparation in accordance
with generally accepted accounting principles and consistency by a
financial officer or the chief accounting officer of the Company;
(iii) not later than the date on which the delivery of each set
of financial statements referred to in clauses (i) and (ii) of this
subsection (a) is required, a certificate of a financial officer or the
chief accounting officer of the Company (A) stating whether there exists
on the date of such certificate any Default and, if any Default then
exists, setting forth the details thereof and the action which the
Company is taking or proposes to take with respect thereto, and (B) if
applicable, setting forth a calculation in the form of Exhibit H hereto
as to compliance with Section 5.01(I);
(iv) forthwith upon the occurrence of any Default, a certificate
of an officer of the Company setting forth the details thereof and the
action which the Company or (so long as the ABI Guarantee shall be in
effect) ABI is taking or proposes to take with respect thereto;
(v) promptly upon the mailing thereof to the shareholders of the
Company generally, copies of all financial statements, reports and proxy
statements so mailed; and
(vi) promptly upon the filing thereof, copies of all registration
statements (other than the exhibits thereto and any registration
statements on Form S-8 or its equivalent or
<PAGE>
<PAGE> 38
37
for an offering of debt or equity securities the proceeds of which will
not exceed $5,000,000) and of all annual, quarterly, monthly or special
reports which the Company shall file with the Securities and Exchange
Commission;
provided that the Company shall be deemed to have delivered the information
- --------
specified in clauses (i), (ii), (v) and (vi) of this subsection (a) on the
date such information is posted at the Company's website on the Internet at
"www.anheuser-busch.com", at "www.sec.gov" or at such other website
identified by the Company in a notice to the Administrative Agent and the
Banks that is accessible by the Banks without charge; provided further that
----------------
the Company shall deliver paper copies of such information to any Bank upon
request of such Bank through the Administrative Agent.
(b) Limitations on Liens. The Company will not create, assume,
--------------------
incur, guarantee or suffer to exist, and will not cause, suffer or permit any
Restricted Subsidiary to create, assume, incur, guarantee or suffer to exist,
any Debt secured by any Lien on any of its Principal Plants or on the stock
or other securities of any Restricted Subsidiary, other than:
(i) any such Liens existing on the date hereof and listed on
Schedule 5.01(b) hereto; provided that such Liens shall secure only
--------
those obligations which they secure on the date hereof or extensions,
renewals or replacements thereof referred to in clause (vii) of this
subsection (b);
(ii) purchase money Liens on assets acquired after the date hereof,
or Liens on assets acquired after the date hereof which secure Debt, the
proceeds of which are used to reimburse the Company or any Restricted
Subsidiary for the cost of the acquisition or construction of such
assets;
(iii) Liens on any asset acquired by the Company or any Subsidiary
(other than from the Company or any Subsidiary) after the date hereof
existing at the time of acquisition of such asset;
(iv) Liens on an asset to secure all or any part of the cost of
development or construction of such asset or improvements thereon and
which shall be released or satisfied within 120 days after completion
of such development or construction;
(v) Liens on an asset created in connection with the acquisition,
construction or development of additions, extensions or improvements to
such asset which shall be financed by obligations described in Sections
142, 144(a) or 144(c) of the Code, as amended, or by obligations entitled
to substantially similar tax benefits under other legislation or
regulations in effect from time to time;
(vi) Liens securing indebtedness owing to the Company or any of its
Restricted Subsidiaries by a Restricted Subsidiary of the Company;
(vii) extensions, renewals or replacements of Liens referred to in
clauses (i) to (vi), inclusive, or (x) of this subsection (b), that, in
the case of a Lien referred to in clause
<PAGE>
<PAGE> 39
38
(iv), (v), (vi) or (x), shall continue to satisfy all of the requirements
of the applicable clause; provided that the Debt secured by such
--------
extension, renewal or replacement Lien is not increased and that such Lien
does not attach to any other assets;
(viii) as permitted under Section 5.01(f);
(ix) Liens incurred in connection with sale and leaseback
transactions permitted under Section 5.01(g); and
(x) Liens on an asset required in connection with any program, law,
statute or regulation of any state or local authority which provides
financial or tax benefits not available without such Lien, provided that
--------
substantially all of the obligations secured by such Lien are obligations
that are in lieu of, or reduce, a property tax or other payment
obligation that itself would have been secured by a Lien permitted
hereunder.
(c) Consolidation, Merger or disposition of Assets. The Company
----------------------------------------------
will not (i) consolidate or merge with or into any other Person or (ii) sell,
lease or otherwise transfer (or permit any of its Restricted Subsidiaries to
engage in any such transaction), directly or indirectly (in a single
transaction or a series of related transactions), assets constituting all or
substantially all the assets of the Company and its Restricted Subsidiaries,
taken as a whole, to any other Person other than to the Company or (unless
the ABI Guarantee shall be in effect) any Restricted Subsidiary that is a
wholly-owned Subsidiary of the Company; provided that nothing in this
--------
Agreement shall prohibit (A) the Packaging Business Divestiture or (B) any
consolidation or merger transaction in which the Company is a party so long
as (i) the Company is the surviving entity and (ii) no Default shall have
occurred and be continuing at the time of or after giving effect to any such
consolidation or merger transaction.
(d) Change in Nature of Business. The Company will not change, or
----------------------------
permit to be changed, the nature of the business conducted by it and its
Subsidiaries as a whole.
(e) Disposition of Assets. The Company will not, and will not
---------------------
permit any of its Restricted Subsidiaries to, dispose of (in a single
transaction or a series of related transactions) any Principal Plants or any
stock of any Restricted Subsidiaries if the net book value of such Principal
Plants and/or the assets of such Restricted Subsidiaries (or, in the case of
the disposition of only a part of the stock of any Restricted Subsidiary,
that percentage of the assets of each such Restricted Subsidiary which is
equal to the percentage of the stock of such Restricted Subsidiary that has
been or is to be disposed of) exceeds, in the aggregate, 10% of Net Tangible
Assets, as reflected on the balance sheet most recently delivered prior to
such transaction (or series of related transactions) by the Company to the
Banks pursuant to Section 5.01(a); provided, however, that the foregoing
-------- -------
shall not prohibit (A) the Packaging Business Divestiture or (B) such
transaction (or transactions) (x) if the disposition is made solely to a
Restricted Subsidiary that is a wholly-owned Subsidiary of the Company or (y)
if an amount equal to the proceeds therefrom in excess of such 10% of Net
Tangible Assets shall be applied, not later than 120 days (or, if the Company
holds such excess proceeds in cash or cash equivalents, two years) after such
transaction (or after the transaction in such series which causes such amount
to be exceeded), either to the repayment or prepayment of Funded Debt of the
<PAGE>
<PAGE> 40
39
Company or to pay (or to repay or prepay Debt incurred in order to pay) the
cost of expanding, constructing or acquiring any Principal Plants; provided
--------
further, however, that (so long as the ABI Guarantee shall be in effect) (i)
- ------- -------
in the case of a disposition of a Principal Plant of ABI, if an amount is to
be applied to pay (or to repay or prepay Debt incurred in order to pay) the
cost of expanding, constructing or acquiring a Principal Plant in order to
comply with the foregoing, such Principal Plant must be owned by ABI, and
(ii) the Company will not, and will not permit any of its Subsidiaries to,
directly or indirectly, (A) dispose of any Principal Plant of ABI to any
other Subsidiary or (B) dispose of any stock of ABI (or any stock of any
Subsidiary that directly or indirectly owns any stock of ABI) to any
Subsidiary other than a Restricted Subsidiary that is wholly-owned, directly
or indirectly, by the Company.
(f) Additional Permitted Secured Indebtedness. Notwithstanding the
-----------------------------------------
provisions of Sections 5.01(b) and (g), the Company and any one or more
Restricted Subsidiaries may (i) create, assume, guarantee or suffer to exist
any Debt secured by a Lien which would otherwise be subject to the
restrictions of Section 5.01(b), and (ii) transfer any Principal Plant in a
sale-leaseback transaction which would otherwise be subject to the
restrictions of Section 5.01(g), if, after giving effect to the incurrence of
such Debt or the transfer of such Principal Plant, the aggregate principal
amount of all such Debt outstanding at such time, when added to the fair
market value of all such Principal Plants transferred after the date hereof
and not reacquired at such time (computed without duplication of amounts
constituting Debt referred to in clause (i) of this subsection (f)), would
not at the time exceed 10% of Net Tangible Assets (determined before giving
effect to the incurrence of such Debt or the transfer of such Principal
Plant).
(g) Sale and Leaseback. Except (x) as permitted under Section
------------------
5.01(f), (y) for any transaction involving a lease for a temporary period not
to exceed three years, by the end of which it is intended that the use of the
leased Principal Plant by the Company or any Subsidiary will be discontinued
and (z) for any transaction with a state or local authority that is required
in connection with any program, law statute or regulation that provides
financial or tax benefits not available without such transaction, neither the
Company nor any Restricted Subsidiary shall sell any Principal Plant as an
entirety, or any substantial portion thereof, with the intention of the
Company or any Subsidiary taking back a lease of such Principal Plant or
portion, unless:
(i) the fair market value of the net proceeds of such sale are
at least equal to the fair market value (as determined by an officer
of the Company) of such Principal Plant or portion; and
(ii) the Company shall within 120 days (or, if the Company holds
the net proceeds described below in cash or cash equivalents, two years)
after the transfer of title to such Principal Plant or portion, (A)
prepay Funded Debt of the Company in amount equal to such net proceeds,
(B) expend an amount equal to such net proceeds for the expansion,
construction or acquisition of a facility which will then constitute a
Principal Plant or (C) effect a combination of the transactions referred
to in clauses (A) and (B) above in an amount equal to such net proceeds;
provided that (so long as the ABI Guarantee shall be in effect), in the
--------
case of a sale of a Principal Plant (or portion thereof) of ABI, if an
amount is to be expended for the expansion, construction or acquisition
of a
<PAGE>
<PAGE> 41
40
Principal Plant in order to comply with the foregoing, such Principal
Plant must be owned by ABI.
(h) Ownership of Shares of ABI. The Company will at all times
--------------------------
continue to own, directly or indirectly, 100% of the outstanding Voting Stock
of ABI.
(i) Consolidated Net Worth. Consolidated Net Worth will not be
----------------------
less than $1,500,000,000 on any date; provided that compliance with this
--------
subsection (i) shall not be required on any date that Index Debt shall be
rated BBB- or higher by S&P and Baa3 or higher by Moody's. For purposes of
the foregoing, if any rating established by Moody's or S&P shall be changed,
such change shall be effective as of the date on which it is first announced
by the applicable rating agency.
(j) Consultation. Solely for the purpose of permitting the Banks
------------
to determine compliance by the Company and (so long as the ABI Guarantee
shall be in effect) ABI with this Agreement, the Company will permit, and
will cause its Restricted and Eligible Subsidiaries to permit, any Bank (and
any person appointed by any Bank to whom the Company does not reasonably
object) to discuss the affairs, finances and accounts of the Company and its
Restricted and Eligible Subsidiaries with the officers of the Company or any
of its Subsidiaries, all at such reasonable times and as often as may
reasonably be requested.
(k) Payment of Taxes; Corporate Existence; Maintenance of
-----------------------------------------------------
Properties; Insurance. The Company will, and will cause each Restricted
- ---------------------
Subsidiary to,
(i) pay and discharge promptly all taxes, assessments and other
governmental charges imposed upon it (whether directly or through the
ownership of Subsidiaries) or any of its property; provided, however,
-------- -------
that the Company and each Restricted Subsidiary of the Company shall not
be required to pay any such tax, assessment or other governmental charge
the payment of which is being contested in good faith and by appropriate
proceedings and as to which adequate reserves have been provided in
accordance with generally accepted accounting principles, except that
the Company will pay or cause to be paid all such taxes, assessments and
governmental charges forthwith upon the commencement of proceedings to
foreclose any Lien which has attached as security therefor, unless such
foreclosure is stayed by the filing of an appropriate bond;
(ii) do all things necessary to preserve and keep in full force and
effect its corporate existence, rights and franchises; provided, however,
-------- -------
that nothing in this subsection (ii) shall prevent any consolidation,
merger or other transaction among any of the Company's Subsidiaries or
any abandonment or termination of the corporate existence of any
Restricted Subsidiary (other than (so long as the ABI Guarantee shall
in effect) ABI) or any abandonment or termination of any rights or
be franchises of any Restricted Subsidiary or any abandonment or
termination of any rights or franchises of the Company so long as such
abandonment or termination does not change the overall nature of the
business conducted by the Company and its Subsidiaries and so long as it
is not disadvantageous in any material respect to the Banks and is, in
the opinion of the Company, in the best interests of the Company;
<PAGE>
<PAGE> 42
41
(iii) maintain and keep its properties as a whole in good repair,
working order and condition; provided, however, that nothing in this
-------- -------
subsection (iii) shall prevent any abandonment of any of its properties
that is not disadvantageous in any material respect to the Banks and
that is, in the opinion of the Company, in the best interests of the
Company; and
(iv) insure or self-insure its assets and business in such manner
and to such extent as is customary with business enterprises of
comparable size and subject to comparable hazards.
(l) Pari Passu Obligations. Except for secured Debt permitted
----------------------
under Section 5.01(b) or 5.01(f), the Company shall cause the obligations of
the Company and (so long as the ABI Guarantee shall be in effect) ABI in
respect of the Loans at all times to rank not less than pari passu with all
other senior indebtedness of the Company and ABI, respectively.
(m) ERISA. As soon as possible and in any event within 30 days
-----
after the Company or any member of the ERISA Group:
(i) receives notice from the PBGC under Title IV of ERISA of an
intent to terminate, impose liability (other than for premiums under
Section 4007 of ERISA) in respect of, or appoint a trustee to administer
any Plan;
(ii) applies for a waiver of the minimum funding standard under
Section 412 of the Code;
(iii) gives notice of intent to terminate any Plan under Section
4041(c) of ERISA; or
(iv) receives notice from a Multiemployer Plan of intent to impose
liability under Title IV of ERISA;
and such events in the aggregate could subject, or have subjected, the
Company and all members of the ERISA Group to any Taxes, Debts, penalties or
liabilities in excess of $80,000,000 at any one time (it being understood
that any such Taxes, Debts, penalties or liabilities that have been satisfied
or paid by the Company shall not be included in determining the foregoing
amount), the Company will deliver, or cause to be delivered, to the
Administrative Agent a certificate of an Executive Officer setting forth the
details of such of the events described in (i) through (iv) as are applicable
and the action which the Company and all relevant members of the ERISA Group
propose to take or have taken with respect thereto, together with copies of
all notices or filings received from the PBGC, the Internal Revenue Service
or any other agency of the United States government or required by the PBGC,
the Internal Revenue Service or any other agency of the United States
government with respect such of the events described in (i) through (iv) as
are applicable.
(n) Payment of Guaranty Fee. So long as the ABI Guarantee shall be
-----------------------
in effect, the Company will pay to ABI the guaranty fee required pursuant to
the Guaranty Fee Agreement
<PAGE>
<PAGE> 43
42
and will take all such other action as may be necessary to maintain the
Guaranty Fee Agreement in full force and effect at all times.
(o) Compliance with Laws. The Company will comply, and cause each
--------------------
of its Subsidiaries to comply, in all material respects with all
Environmental Laws and ERISA and the rules and regulations thereunder except
where the necessity of compliance therewith is contested in good faith by
appropriate proceedings, and except where failure to so comply would not
materially and adversely affect the ability of the Company or (so long as the
ABI Guarantee shall be in effect) ABI to perform its obligations hereunder.
(p) Ratings. The Company will use commercially reasonable efforts
-------
to obtain and maintain ratings of Index Debt at all times from Moody's and
S&P (unless, in either case, such rating agency shall cease to rate corporate
debt obligations) and will promptly notify the Banks upon obtaining knowledge
of any change in, or cessation of, such ratings.
Section 5.02. Use of Proceeds. The Company and each Borrower agree
---------------
that the proceeds of Loans made under this Agreement will be used for the
general corporate purposes of the applicable Borrower and that none of such
proceeds will be used in violation of any applicable law or regulation.
Section 5.03. Covenant of ABI. ABI agrees that, so long as any
---------------
Bank has any Commitment hereunder or any Loan or any other amount owing
hereunder remains unpaid, (a) subject to Section 9.07, ABI will maintain the
Guaranty Fee Agreement in full force and effect, and (b) in the event that
the Company shall at any time fail to pay the guaranty fee due to ABI
pursuant to the Guaranty Fee Agreement, the Administrative Agent or any Bank
or Banks shall have the right, but shall not be obligated, to pay such fee
to ABI.
ARTICLE VI
DEFAULTS
Section 6.01. Events of Default. If one or more of the following
-----------------
events (each an "Event of Default") shall occur and be continuing, such event
----------------
shall constitute an Event of Default under this Agreement, whatever the
reason for such event and whether it shall occur by operation of law or
pursuant to any order, rule or regulation of any court or government
authority or otherwise:
(a) any Borrower shall fail to pay, within two days after the due
date thereof, any principal of any of its Loans, or the Company, any
Borrower or (so long as the ABI Guarantee shall be in effect) ABI shall
fail to pay, within five days after the due date thereof, any interest
on any of its Loans or other amount payable by it under this Agreement;
(b) the Company shall violate or fail to perform any of its
covenants or agreements contained in Section 5.01(b), (c), (d), (e),
(g), (h) or (i) or the last sentence of Section 9.07 or (so long as the
ABI Guarantee shall be in effect) ABI shall violate or fail
<PAGE>
<PAGE> 44
43
to perform any of its covenants or agreements contained in Section 5.03;
(c) the Company, any Eligible Subsidiary or (so long as the ABI
Guarantee shall be in effect) ABI shall fail to perform any term,
covenant or agreement herein contained (other than those referred to in
clause (a) or (b) of this Section) for 30 days after written notice of
such failure is given to the Company by the Administrative Agent at the
request of any Bank;
(d) the Company, ABI or any Eligible Subsidiary shall have made any
representation, warranty or statement in or pursuant to this Agreement,
or in any certificate or other document delivered by or on behalf of the
Company pursuant hereto, which shall prove to have been false in any
material respect when made;
(e) the Company or any Restricted Subsidiary shall fail (and such
failure shall not have been cured or waived) to perform or observe any
provision, term or condition of, or any default shall occur under, any
agreement or instrument relating to any of its Indebtedness (other than
the Indebtedness hereunder), the principal amount of which equals or
exceeds $100,000,000 in the aggregate (or its equivalent in another
currency) which results in the acceleration of maturity of such
Indebtedness;
(f) the Company or any Restricted Subsidiary shall have entered
against it by a court having jurisdiction in the premises a decree or
order for relief in respect of it in an involuntary case under any
applicable bankruptcy, insolvency or other similar law now or hereafter
in effect, or appointing a receiver, liquidator, assignee, custodian,
trustee, sequestrator (or similar official) of it or for all or any
substantial part of its property, or ordering the winding-up or
liquidation of its affairs, and such decree or order shall remain
unstayed and in effect for a period of 60 consecutive days;
(g) the Company or any Restricted Subsidiary shall commence a
voluntary case under any applicable bankruptcy, insolvency or other
similar law now or hereafter in effect, or consent to the entry of an
order for relief in an involuntary case under any such law, or consent
to the appointment of or taking possession by a receiver, liquidator,
assignee, trustee, custodian, sequestrator (or similar official) for
it or for all or any substantial part of its property, or make any
general assignment for the benefit of any of the foregoing or for the
benefit of its creditors;
(h) any one or more of the events or conditions referred to in
clauses (i) through (iii) of this subsection (h) shall occur:
(i) failure of any member of the ERISA Group sponsoring a
Material Plan to pay within 30 days after it becomes due an amount
or amounts aggregating in excess of $100,000,000 (other than for
premiums under Section 4007 of ERISA) which it shall have become
liable to pay under Section 412 of the Code or Section 302 or
Title IV of ERISA with respect to such Material Plan;
(ii) termination, imposition of liability (other than for
premiums under
<PAGE>
<PAGE> 45
44
Section 4007 of ERISA), or appointment of a trustee by the PBGC
under Title IV of ERISA in respect of any Plan, where the amount
of unfunded benefit liabilities within the meaning of Section
4001(a)(18) of ERISA in respect of such Plan and any other Plans
similarly affected could reasonably be expected to exceed
$100,000,000 in the aggregate; or
(iii) a complete or partial withdrawal from, or a default
within the meaning of Section 4219(c)(5) of ERISA with respect to
one or more Multiemployer Plans which could reasonably be expected
to cause one or more members of the ERISA Group to incur in the
aggregate any Taxes, Debts, penalties or liabilities in excess of
$100,000,000 and such Taxes, Debts, penalties or liabilities remain
unsatisfied for a period of 30 days;
(i) a judgment or order for the payment of money in excess of
$100,000,000 shall be rendered against the Company or any Restricted
Subsidiary and such judgments or order shall continue unsatisfied and
unstayed for a period of 30 days;
(j) any Person, either alone or together with others acting in
concert with such Person, shall own 50% or more of the outstanding shares
of Voting Stock of the Company, or the Continuing Directors shall not
constitute a majority of the Board of Directors; or
(k) except as provided in Section 9.07, the Guaranty Fee Agreement,
the ABI Guarantee or any guarantee by the Company pursuant to Article IX
shall cease to be, or shall be asserted by ABI or the Company not to be,
in full force and effect.
Section 6.02. Remedies Upon Default. Upon the occurrence and
---------------------
continuation of an Event of Default set forth in Section 6.01, (a) the
Administrative Agent shall, if requested in writing by Banks having more than
51% or more of the Total Commitment, by notice in writing to the Company (on
behalf of the Borrowers) terminate the Total Commitment, and the Total
Commitment shall thereupon terminate, and (b) the Administrative Agent shall,
if requested in writing by the holders of more than 51% or more in aggregate
principal amount of the Loans then outstanding, by notice in writing to the
Company declare the principal of and interest on the Loans and all other
amounts payable hereunder (together with accrued interest thereon) to be, and
they shall thereupon forthwith be and become, immediately due and payable
without presentment, demand, protest or other notice of any kind, all of
which are hereby expressly waived; provided, however, that in the case of the
-------- -------
occurrence of any Event of Default described in Section 6.01(f) or (g),
without any notice to the Company or any other Borrower or any other act by
the Administrative Agent or the Banks, the Total Commitment shall thereupon
terminate and the Loans and all other amounts payable hereunder (together
with accrued interest thereon) shall thereupon be and become immediately due
and payable upon such occurrence, without presentment, demand, protest or
other notice of any kind, all of which are hereby expressly waived by the
Company, each other Borrower and ABI. Simultaneously with the giving of any
such notice to the Company, the Administrative Agent shall notify all of the
Banks thereof.
Section 6.03. Notice of Default. The Administrative Agent shall
-----------------
give notice to
<PAGE>
<PAGE> 46
45
the Company under Section 6.01(c) promptly upon being requested to do so by
any Bank and shall thereupon notify all the Banks thereof.
ARTICLE VII
THE ADMINISTRATIVE AGENT
Section 7.01. Appointment and Authorization. Each Bank irrevocably
-----------------------------
appoints and authorizes the Administrative Agent to take such action as agent
on its behalf and to exercise such powers under this Agreement as are
delegated to the Administrative Agent by the terms hereof or thereof,
together with all such powers as are reasonably incidental thereto.
Section 7.02. Administrative Agent and Affiliates. The Person
-----------------------------------
serving as the Administrative Agent shall have the same rights and powers
under this Agreement as any other Bank and may exercise or refrain from
exercising the same as though it were not the Administrative Agent, and such
Person and its Affiliates may accept deposits from, lend money to, and
generally engage in any kind of business with the Company or any Affiliate or
Subsidiary of the Company as if it were not the Administrative Agent
hereunder.
Section 7.03. Action by Administrative Agent. The obligations of
------------------------------
the Administrative Agent hereunder are only those expressly set forth herein.
Without limiting the generality of the foregoing, the Administrative Agent
shall not be required to take any action with respect to any Default, except
as expressly provided in Article VI.
Section 7.04. Consultation with Experts. The Administrative Agent
-------------------------
may consult with legal counsel (who may be counsel for the Company),
independent public accountants and other experts selected by it and shall not
be liable for any action taken or omitted to be taken by it in good faith in
accordance with the advice or opinion of such counsel, accountants or
experts.
Section 7.05. Liability of Administrative Agent. Neither the
---------------------------------
Administrative Agent nor any of its directors, officers, agents or employees
shall be liable for any action taken or not taken by it, him or her in
connection herewith (a) with the consent or at the request of the Required
Banks or (b) in the absence of its, his or her own gross negligence or
willful misconduct. Neither the Administrative Agent nor any of its
directors, officers, agents or employees shall be responsible for or have any
duty to ascertain, inquire into or verify (i) any statement, warranty or
representation made in connection with this Agreement or any borrowing
hereunder; (ii) the performance or observance of any of the covenants or
agreements of the Company, ABI or any Eligible Subsidiary; (iii) the
satisfaction of any condition specified in Article III, except receipt of
items required to be delivered to the Administrative Agent; or (iv) the
validity, effectiveness or genuineness of this Agreement or any other
instrument or writing furnished in connection herewith. The Administrative
Agent shall not incur any liability by acting in reliance upon any notice,
consent, certificate, statement or other writing (which may be a bank wire,
telecopy or similar writing) believed by it to be genuine or to be signed or
sent by the proper party or parties. The Administrative Agent shall be
entitled to assume that no Default has occurred and is continuing, unless the
Administrative Agent has actual knowledge, or has been notified by the
Company, of such Default, or has been notified by a Bank that such Bank
<PAGE>
<PAGE> 47
46
considers that such Default (specifying in detail the nature thereof) has
occurred and is continuing.
Section 7.06. Indemnification. Each Bank shall, ratably in
---------------
accordance with its Commitment, indemnify the Administrative Agent (to the
extent not reimbursed by the Company or ABI) against any cost, expense
(including counsel fees and disbursements and the costs of investigation,
discovery and deposition), claim, demand, action, loss or liability (except
such as result from the Administrative Agent's gross negligence or willful
misconduct) that the Administrative Agent may suffer or incur in connection
with this Agreement or any action taken or omitted by the Administrative
Agent hereunder.
Section 7.07. Credit Decision. Each Bank represents and
---------------
acknowledges that it has, independently and without reliance on the
Administrative Agent or any other Bank, and based on such documents and
information as it has deemed appropriate, made its own credit analysis and
decision to enter into this Agreement. Each Bank also represents and
acknowledges that it will, independently and without reliance on the
Administrative Agent or any other Bank, and based on such documents and
information as it shall deem appropriate at the time, continue to make its
own credit decisions in taking or not taking any action under this Agreement.
Section 7.08. Resignation of Administrative Agent. The
-----------------------------------
Administrative Agent may resign at any time by giving written notice thereof
to the Banks and the Company. Upon any such resignation, the Company, with
the consent of the Required Banks, shall have the right to appoint a
successor Administrative Agent. If no successor Administrative Agent shall
have been so appointed by the Company, and shall have accepted such
appointment, within 30 days after the retiring Administrative Agent's giving
of notice of resignation, then the retiring Administrative Agent may, on
behalf of the Banks, appoint a successor Administrative Agent, which shall be
(a) a commercial bank organized under the laws of the United States or of any
State thereof and having a combined capital and surplus of at least
$500,000,000 or (b) a Bank. Upon the acceptance of any appointment as
Administrative Agent hereunder by a successor Administrative Agent, such
successor Administrative Agent shall thereupon succeed to and become vested
with all the rights, powers, privileges, and duties of the retiring
Administrative Agent, and the retiring Administrative Agent shall thereupon
be discharged from its duties and obligations as Administrative Agent under
this Agreement. After any retiring Administrative Agent's resignation as
Administrative Agent, the provisions of this Article VII shall continue to
inure to its benefit as to any actions taken or omitted to be taken by it
while it was Administrative Agent under this Agreement.
Section 7.09. Advisor, Lead Arranger, Book Manager and
----------------------------------------
Co-Syndication Agents. Notwithstanding anything herein to the contrary, none
- ---------------------
of the Advisor, Lead Arranger, Book Manager and Co-Syndication Agents listed
on the cover page of this Agreement shall have any duties or responsibilities
hereunder in their respective capacity as such, except in their respective
capacity, if any, as a Bank.
<PAGE>
<PAGE> 48
47
ARTICLE VIII
CHANGE IN CIRCUMSTANCES
Section 8.01. Basis for Determining Interest Rate Inadequate or
-------------------------------------------------
Unfair. If with respect to any Interest Period:
- ------
(a) the Administrative Agent determines (which determination shall
be conclusive absent manifest error) that adequate and reasonable means
do not exist for ascertaining the Adjusted LIBO Rate (in the case of a
Syndicated Loan) or the LIBO Rate (in the case of a Money Market LIBOR
Loan) for such Interest Period, or
(b) in the case of a Syndicated Borrowing, Banks having 50% or more
of the Total Commitment notify the Administrative Agent that the Adjusted
CD Rate or the Adjusted LIBO Rate, as the case may be, as determined by
the Administrative Agent will not adequately and fairly reflect the cost
to such Banks of maintaining or funding their CD Loans or Euro-Dollar
Loans, as the case may be, for such Interest Period,
the Administrative Agent shall forthwith give notice thereof to the Company
(on behalf of the applicable Borrower) and the Banks, and until the
Administrative Agent notifies the Company that the circumstances giving rise
to such suspension no longer exist, the obligations of the Banks to make CD
Loans or Euro-Dollar Loans, as the case may be, shall be suspended; provided
--------
that if the circumstances giving rise to such notice do not affect all the
Banks, then requests by the Company (on behalf of the applicable Borrower)
for Syndicated Borrowings may be made to the Banks that are not affected
thereby. Each Bank which notifies the Administrative Agent pursuant to
subsection (b) of this Section agrees that, in the event that after such
notice the Adjusted CD Rate or Adjusted LIBO Rate, as the case may be, shall
thereafter adequately and fairly reflect the cost to such Bank of maintaining
or funding its CD Loans or Euro-Dollar Loans, as the case may be, for any
Interest Period, it shall notify the Administrative Agent of such fact. In
the event that the Administrative Agent shall receive notice from such Banks
pursuant to the preceding sentence that the conditions set forth in
subsection (b) of this Section no longer exist, the Administrative Agent
shall notify the Company thereof. Unless the Company notifies the
Administrative Agent at least two Domestic Business Days before the date of
any Fixed Rate Borrowing for which a Notice of Borrowing has previously been
given that it elects on behalf of the applicable Borrower not to borrow on
such date, (i) if such Fixed Rate Borrowing is a Syndicated Borrowing, such
Borrowing shall instead be made as a Base Rate Borrowing and (ii) if such
Fixed Rate Borrowing is a Money Market LIBOR Borrowing, the Money Market
LIBOR Loans comprising such Borrowing shall bear interest for each day from
and including the first day to but excluding the last day of the Interest
Period applicable thereto at the Base Rate for such day.
Section 8.02. Illegality. If, after the date hereof, the adoption
----------
of any applicable law, rule or regulation, or any change therein, or any
change in the interpretation or administration thereof by any governmental
authority, central bank or comparable agency charged with the interpretation
or administration thereof, or compliance by any Bank (or its Euro-Dollar
Lending Office) with any request or directive (whether or not having the
force of law) of any such governmental authority, central bank or comparable
agency, shall make it unlawful or impossible for any Bank (or its
<PAGE>
<PAGE> 49
48
Euro-Dollar Lending Office) to make, maintain or fund its Euro-Dollar Loans
and such Bank shall so notify the Administrative Agent, the Administrative
Agent shall forthwith give notice thereof to the other Banks and the Company,
and until such Bank notifies the Company and the Administrative Agent that
the circumstances giving rise to such suspension no longer exist, the
obligation of such Bank to make Euro-Dollar Loans shall be suspended. Each
Bank which gives any notice pursuant to this Section agrees that, in the
event that the circumstances giving rise to such suspension no longer exist,
such Bank shall notify the Administrative Agent of such fact. In the event
that the Administrative Agent shall receive notice from a Bank pursuant to
the preceding sentence of this Section, the Administrative Agent shall notify
the Company thereof. Before giving any notice to the Administrative Agent
pursuant to the first sentence of this Section, such Bank shall designate a
different Euro-Dollar Lending Office if such designation will avoid the need
for giving such notice and will not, in the judgment of such Bank, be
otherwise disadvantageous to such Bank. If such Bank shall determine that it
may not lawfully continue to maintain and fund any of its outstanding
Euro-Dollar Loans to maturity and shall so specify in such notice, the
applicable Borrower or Borrowers shall immediately prepay in full the then
outstanding principal amount of each such Euro-Dollar Loan, together with
interest accrued thereon to the date of such prepayment. Concurrently with
prepaying each such Euro-Dollar Loan, each applicable Borrower shall borrow a
Base Rate Loan in an equal principal amount from such Bank (on which interest
and principal shall be payable contemporaneously with the related Euro-Dollar
Loans of the other Banks), and such Bank shall make such a Base Rate Loan.
Section 8.03. Increased Cost. (a) If, on or after (x) the date
--------------
hereof, in the case of any Syndicated Loan or any obligation to make
Syndicated Loans, or (y) the date of the related Money Market Quote, in the
case of any Money Market Loan, or (z) the date that the applicable Bank
agrees to make a Negotiated Rate Loan, in the case of any Negotiated Rate
Loan, the adoption of any applicable law, rule or regulation, or any change
therein, or any change in the interpretation or administration thereof by any
governmental authority, central bank or comparable agency charged with the
interpretation or administration thereof, or compliance by any Bank (or its
Lending Office) with any request or directive (whether or not having the
force of law) of any such governmental authority, central bank or comparable
agency:
(i) shall subject any Bank (or its Lending Office) to any tax, duty
or other charge with respect to its Fixed Rate Loans or its obligation to
make Fixed Rate Loans, or shall change the basis of taxation of payments
to any Bank (or its Lending Office) of the principal of or interest on
its Fixed Rate Loans or any other amounts due under this Agreement in
respect of its Fixed Rate Loans or its obligation to make Fixed Rate
Loans (except for changes in the rate of tax on the overall net income
of such Bank or its Lending Office imposed by the jurisdiction in which
such Bank's principal executive office or Lending Office, as the case
may be, is located); or
(ii) shall impose, modify or deem applicable any reserve, special
deposit, deposit insurance assessment (excluding with respect to any
CD Loan any such assessment
<PAGE>
<PAGE> 50
49
included in an applicable Assessment Rate) or similar requirement
(including, without limitation, any such requirement imposed by the
Board of Governors of the Federal Reserve System, but excluding (A) with
respect to any CD Loan, any such requirement included in an applicable
CD Reserve Percentage, and (B) with respect to any Euro-Dollar Loan,
any such requirement included in an applicable Euro-Dollar Reserve
Percentage, and (C) any requirement for which such Bank is entitled to
compensation under subsection (b) of this Section) against assets of,
deposits with or for the account of, or credit extended by, any Bank or
its Lending Office or shall impose on any Bank (or its Lending Office) or
on the United States market for certificates of deposit or the London
interbank market any other condition affecting its Fixed Rate Loans or
its obligation to make Fixed Rate Loans;
and the result of any of the foregoing is to increase the cost to such Bank
(or its Lending Office) of making or maintaining any Fixed Rate Loan, or to
reduce the amount of any sum received or receivable by such Bank (or its
Lending Office) under this Agreement with respect thereto, by an amount
deemed by such Bank to be material, then, within 15 days after demand by such
Bank to the Company (with a copy to the Administrative Agent), the applicable
Borrower or Borrowers shall pay for the account of such Bank, as additional
interest, such additional amount or amounts as will compensate such Bank for
such increased cost or reduction; provided that if such Bank fails to notify
--------
the Company that it intends to claim or may claim compensation for such
increased cost or reduction within 45 days after such Bank has knowledge of
such increased cost or reduction, the applicable Borrower shall not be
obligated to compensate such Bank for such increased cost or reduction
accruing prior to the date on which such Bank first notifies the Company that
it intends to claim such compensation. In determining such additional amount
or amounts, such Bank may use any reasonable averaging and attribution
methods.
(b) If, after the date hereof, the Administrative Agent or any Bank
shall have determined that the adoption of any applicable law, rule or
regulation regarding capital adequacy, or any change therein, or any change
in the interpretation or administration thereof by any governmental
authority, central bank or comparable agency charged with the interpretation
or administration thereof (including a change resulting from a determination
of a court or regulatory authority), or compliance by the Administrative
Agent or any Bank (or its Lending Office or holding company) with any request
or directive regarding capital adequacy (whether or not having the force of
law) of any such governmental authority, central bank or comparable agency,
has or would have the effect of reducing the rate of return on the
Administrative Agent's or such Bank's capital (or the capital of its holding
company) as a consequence of its obligations hereunder to a level below that
which the Administrative Agent or such Bank or its holding company could have
achieved but for such adoption, change or compliance (taking into
consideration the Administrative Agent's or such Bank's, as the case may be,
policies with respect to capital adequacy) by an amount deemed by the
Administrative Agent or such Bank to be material, then from time to time,
within 15 days after demand by the Administrative Agent or such Bank (with a
copy to the Administrative Agent), the Company shall pay to the
Administrative Agent or such Bank, as the case may be, such additional amount
or amounts as will compensate the Administrative Agent or such Bank or its
holding company for such reduction. In determining any additional amount or
amounts payable under this subsection (b),
<PAGE>
<PAGE> 51
50
the Administrative Agent or such Bank may use any reasonable averaging and
attribution methods; provided that if after the date hereof, pursuant to any
--------
applicable law, rule or regulation regarding capital adequacy, or any change
therein, or any change in interpretation or administration thereof by any
governmental authority, central bank or comparable agency charged with the
interpretation or administration thereof, the credit quality of a bank's
loans, investments or commitments is required or permitted to be taken into
account in determining capital adequacy, then such averaging and attribution
methods shall include a consideration of the credit quality of the Loans
relative to the credit quality of such Bank's other loans, investments or
commitments, as the case may be.
(c) The Administrative Agent or each relevant Bank, as the case
may be, will promptly notify the Company and the Administrative Agent of any
event of which it has knowledge occurring after the date hereof which will
entitle the Administrative Agent or such Bank to compensation pursuant to
this Section and will designate a different Lending Office if such
designation will avoid the need for, or reduce the amount of, such
compensation and will not, in the judgment of the Administrative Agent or
such Bank, be otherwise disadvantageous to the Administrative Agent or such
Bank. A certificate of the Administrative Agent or any Bank claiming
compensation under this Section and setting forth the additional amount or
amounts to be paid to it hereunder shall be conclusive in the absence of
manifest error.
(d) Each Bank agrees that if, after such Bank has made a demand for
compensation pursuant to this Section, the circumstances giving rise to such
demand no longer exist, such Bank shall notify the Administrative Agent of
such fact. In the event that the Administrative Agent shall receive notice
from a Bank pursuant to the preceding sentence of this Section, the
Administrative Agent shall notify the Company thereof.
Section 8.04. Base Rate Loans Substituted for Affected Fixed Rate
---------------------------------------------------
Loans. If (a) the obligation of any Bank to make Euro-Dollar Loans has been
- -----
suspended pursuant to Section 8.02 or (b) any Bank has demanded compensation
under Section 2.15 or 8.03, and the Company shall, by at least five
Euro-Dollar Business Days' prior notice to such Bank through the
Administrative Agent, have elected that the provisions of this Section shall
apply to such Bank, then, unless and until such Bank notifies the Company and
the Administrative Agent that the circumstances giving rise to such
suspension or demand for compensation no longer apply, all Loans which would
otherwise be made by such Bank as CD Loans or Euro-Dollar Loans, as the case
may be, shall be made instead as Base Rate Loans (on which interest and
principal shall be payable contemporaneously with the related Fixed Rate
Loans of the other Banks).
Section 8.05. Substitution of Bank. If notice has been given by
--------------------
any Bank pursuant to Section 8.02 or 8.03 requiring or permitting Fixed Rate
Loans of such Bank to be prepaid, or requesting compensation under Section
2.15 or 8.03(b), then the Company shall have the right, in consultation with
the Administrative Agent, to seek one or more satisfactory substitute
financial institutions (which may be one or more of the Banks) to purchase
the Loans and assume the Commitment of such Bank.
ARTICLE IX
<PAGE>
<PAGE> 52
51
GUARANTEES
Section 9.01. The Guarantees. (a) As an inducement to the Banks to
--------------
enter into this Agreement and to make the Loans provided for herein, and in
consideration for the direct and indirect benefits to be derived by ABI as a
result of Loans to be made hereunder and the guarantee fee paid to ABI by the
Company, ABI hereby unconditionally guarantees the full and punctual payment
(whether at stated maturity, upon acceleration or otherwise) of the principal
of and interest on each Loan to the Company, and the full and punctual
payment of all other amounts payable by the Company under this Agreement,
including, without limitation, the Company's obligations under subsection (b)
of this Section. ABI agrees that upon failure by the Company to pay
punctually any such amount, ABI shall forthwith on demand pay the amount not
so paid at the place and in the manner specified in this Agreement.
(b) The Company hereby unconditionally guarantees the full and
punctual payment (whether at stated maturity, upon acceleration or otherwise)
of the principal of and interest on each Loan to any Eligible Subsidiary, and
the full and punctual payment of all other amounts payable by any Eligible
Subsidiary under this Agreement. The Company agrees that upon failure by any
Eligible Subsidiary to pay punctually any such amount, the Company shall
forthwith on demand pay the amount not so paid at the place and in the manner
specified in this Agreement.
(c) The obligations of ABI and the Company hereunder shall be
guarantees of payment when due and not of collection.
Section 9.02. Guarantees Unconditional. The obligations of ABI
------------------------
and the Company hereunder shall be unconditional and absolute and, without
limiting the generality of the foregoing, shall not be released, discharged
or otherwise affected by:
(i) any extension, renewal, settlement, compromise, waiver or
release in respect of any obligation of the Company or any other
Borrower under this Agreement or any Note, by operation of law or
otherwise;
(ii) any modification or amendment of or supplement to this
Agreement or any Note;
(iii) any release, non-perfection or invalidity of any direct
or indirect security, or of any Guarantee or other liability of any
third party, for any obligation of the Company or any other Borrower
under this Agreement or any Note;
(iv) any change in the corporate existence, structure or ownership
of the Company or any other Borrower, or any insolvency, bankruptcy,
reorganization or other similar proceeding in respect of or affecting
the Company or any other Borrower or its assets or any release or
discharge of any obligation contained in this Agreement or any Note;
<PAGE>
<PAGE> 53
52
(v) the existence of any claim, set-off or other rights which ABI
or the Company may have at any time against the Company or any other
Borrower, the Administrative Agent, any Bank or any other Person, whether
in connection herewith or any unrelated transactions, provided that
--------
nothing herein shall prevent the assertion of any such claim by separate
suit or compulsory counterclaim;
(vi) any invalidity or unenforceability relating to or against the
Company or any other Borrower for any reason of this Agreement or any
Note, or any provision of any applicable law or regulation purporting
to prohibit the payment by the Company or any other Borrower of the
principal of or interest on any Loan or any other amount payable by the
Company or any other Borrower under this Agreement;
(vii) any invalidity or unenforceability of the Guaranty Fee
Agreement or any failure to make any payment of the guarantee fees
provided for thereunder; or
(viii) any failure of any Bank or the Administrative Agent to
assert any claim or demand or to enforce any right or remedy against the
Company, any other Borrower, ABI or any other guarantor or any other act
or omission to act or delay of any kind by the Company, any other
Borrower, the Administrative Agent, any Bank or any other Person, or any
other circumstance whatsoever which might, but for the provisions of this
clause (viii), constitute a legal or equitable discharge of the
obligations of ABI or the Company hereunder.
Section 9.03. Discharge Only Upon Payment in Full Reinstatement in
----------------------------------------------------
Certain Circumstances. Except as provided in Section 9.07, the obligations
- ---------------------
of ABI and the Company hereunder shall remain in full force and effect until
the principal of and interest on the Loans and all other amounts payable
under this Agreement shall have been paid in full. If at any time any
payment of the principal of or interest on any Loan or any other amount
payable by the Company or any other Borrower under this Agreement is
rescinded or must be otherwise restored or returned upon the insolvency,
bankruptcy or reorganization of the Company or any other Borrower or
otherwise, the obligations of ABI and the Company hereunder with respect to
such payment shall be reinstated as though such payment had been due but not
made at such time.
Section 9.04. Waiver by ABI and the Company. Each of ABI and the
-----------------------------
Company irrevocably waives (a) acceptance hereof, (b) presentment, demand,
protest and any notice not provided for herein, and (c) any requirement that
at any time any action be taken by any Person against any Borrower or any
other Person.
Section 9.05. Subrogation. Upon making any payment under its
-----------
guarantee hereunder, ABI or the Company, as the case may be, shall be
subrogated to the rights of the payee against the applicable Borrower with
respect to such payment; provided that neither ABI nor the Company shall
--------
enforce any right to payment by reason of subrogation until all amounts of
principal of and interest on the Loans and all other amounts payable by the
Company and each other Borrower under this Agreement have been paid in full.
Section 9.06. Stay of Acceleration. If acceleration of the time
--------------------
for payment of any
<PAGE>
<PAGE> 54
53
amount payable by the Company or any other Borrower under this Agreement is
stayed upon the insolvency, bankruptcy or reorganization of the Company or
any other Borrower, all such amounts otherwise subject to acceleration under
the terms of this Agreement shall nonetheless be payable by each of ABI and
the Company hereunder forthwith on demand by the Administrative Agent made at
the request of the requisite proportion of the Banks specified in Article VI.
Section 9.07. Termination of ABI Guarantee. At the option of the
----------------------------
Company, the Company may terminate ABI's obligations under this Agreement
(including, without limitation, this Article) without the consent of the
Banks, provided that (i) the Company shall have terminated all of ABI's
--------
Guarantees with respect to other Funded Debt of the Company on or prior
to the date of such termination, (ii) no Default shall have occurred and
be continuing as of such date and (iii) the Company shall have delivered to
the Administrative Agent and the Banks a certificate to the effect that the
foregoing conditions have been complied with, whereupon ABI shall be released
from all of its obligations under this Agreement (including, without
limitation, this Article), ABI shall no longer be a party to this Agreement
and all provisions of this Agreement relating to such obligations shall be of
no further force and effect. Notwithstanding the foregoing, each of the
Company and ABI hereby agrees that the obligations of ABI under this
Agreement (including, without limitation, this Article) and all provisions of
this Agreement relating to such obligations shall be reinstated if, following
the termination of the ABI Guarantee pursuant to this Section, ABI Guarantees
any Funded Debt of the Company or any Restricted Subsidiary having an
aggregate outstanding principal amount in excess of $50,000,000, such
reinstatement to be evidenced by an instrument satisfactory to the
Administrative Agent that the Company shall cause ABI to execute and deliver
to the Administrative Agent within 30 days after the entering into of any
such Guarantee (it being understood that such reinstatement shall be
effective notwithstanding the failure to deliver such instrument).
ARTICLE X
MISCELLANEOUS
Section 10.01. Notices. All notices, requests and other
-------
communications to any party hereunder shall be in writing (including bank
wire, telecopier or similar writing) and shall be given to such party:
(a) in the case of the Company or the Administrative Agent, at its address
or telecopier number set forth on the signature pages hereof, (b) in the case
of any other Bank, at its address or telecopier number set forth in its
Administrative Questionnaire or (c) in the case of any party, such other
address or telecopier number as such party may hereafter specify for the
purpose by notice to the Administrative Agent and the Company. Each such
notice, request or other communication shall be effective (i) if given by
mail, five days after such communication is deposited in the mails with
appropriate first class, certified or registered postage prepaid, addressed
as aforesaid, or (ii) if given by any other means, when delivered at the
telecopier number or address specified in this Section; provided that notices
--------
to the Administrative Agent under Section 2.03, 2.04, 2.05 or 2.10 or Article
VI or VIII shall not be effective until received. All notices, requests and
other communications to or from any Eligible Subsidiary hereunder shall be
valid and effective if given to or from the Company as agent for such
Eligible Subsidiary.
<PAGE>
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54
Section 10.02. No Waivers. No failure or delay by the
----------
Administrative Agent or any Bank in exercising any right, power or privilege
hereunder shall operate as a waiver thereof, nor shall any single or partial
exercise thereof preclude any other or further exercise thereof or the
exercise of any other right, power or privilege. The rights and remedies
herein provided shall be cumulative and not exclusive of any rights or
remedies provided by law.
Section 10.03. Expenses; Documentary Taxes; Indemnity.
--------------------------------------
(a) The Company agrees to pay (i) all reasonable out-of-pocket expenses
of the Administrative Agent, including reasonable fees and disbursements
of special counsel for the Administrative Agent, in connection with the
preparation of this Agreement, any waiver or consent hereunder or any
amendment hereof, and (ii)if an Event of Default occurs, all out-of-pocket
expenses incurred by the Administrative Agent or any Bank, including
reasonable fees and disbursements of either internal or external counsel
(as the Administrative Agent or such Bank chooses), in connection with such
Event of Default and collection and other enforcement proceedings resulting
therefrom. The Company shall indemnify each Bank against any transfer taxes,
documentary taxes or similar assessments or charges made by any governmental
authority by reason of the execution and delivery of this Agreement.
(b) The Company agrees to indemnify each Bank and the
Administrative Agent against, and hold each Bank and the Administrative Agent
harmless from, any and all liabilities, losses, damages, costs and expenses
of any kind (including, without limitation, the reasonable fees and
disbursements of counsel for any Bank or the Administrative Agent in
connection with any investigative, administrative or judicial proceeding,
whether or not such Bank or the Administrative Agent shall be designated
a party thereto), which may be incurred by any Bank or the Administrative
Agent, relating to or arising out of this Agreement or any actual or proposed
use of the proceeds of Loans hereunder; provided that neither any Bank nor
--------
the Administrative Agent shall have the right to be indemnified hereunder for
its own gross negligence or willful misconduct as determined by a court of
competent jurisdiction.
Section 10.04. Sharing of Setoffs. Each Bank agrees that if it
------------------
shall, by exercising any right of set-off or counterclaim or otherwise,
receive payment of a proportion of the aggregate amount of principal and
interest due with respect to any Loan held by it which is greater than the
proportion received by any other Bank in respect of the aggregate amount of
principal and interest due with respect to any Loan held by such other Bank,
the Bank receiving such proportionately greater payment shall purchase such
participations in the Loans held by the other Banks (to which purchase the
Company and each other applicable Borrower hereby consents), and such other
adjustments shall be made, as may be required so that all such payments of
principal and interest with respect to the Loans held by the Banks shall be
shared by the Banks pro rata; provided that nothing in this Section shall
--------
impair the right of any Bank to exercise any right of set-off or counterclaim
it may have and to apply the amount subject to such exercise to the payment
of indebtedness of the Company, any other Borrower or ABI other than its
indebtedness hereunder. The Company, each other Borrower and ABI agree, to
the fullest extent they may effectively do so under applicable law, that any
holder of a participation in a Loan granted in accordance with this Agreement
or any holder of a participation in a Loan acquired pursuant to the
arrangements described in this Section may exercise rights of set-off or
<PAGE>
<PAGE> 56
55
counterclaim and other rights with respect to such participation as fully as
if such holder of a participation were a direct creditor of the applicable
Borrower, the Company or ABI, as the case may be, in the amount of such
participation.
Section 10.05. Amendments and Waivers. (a) The Company, (so long
----------------------
as the ABI Guarantee shall be in effect) ABI and the Administrative Agent may
amend or supplement this Agreement without notice to or the consent of any
Bank or any Eligible Subsidiary (i) to cure any ambiguity, defect or
inconsistency, (ii) to provide for the substitution of one or more financial
institutions for a Bank pursuant to Section 8.05, or (iii) to make any other
change that does not adversely affect the rights of any Bank.
(b) Except as provided in subsection (a) of this Section, any
provision of this Agreement may be amended or waived if, but only if, such
amendment or waiver is in writing and is signed by the Company, (so long as
the ABI Guarantee shall be in effect) ABI and the Required Banks (and, if the
rights or duties of the Administrative Agent are affected thereby, by the
Administrative Agent); provided that no such amendment or waiver shall,
--------
unless signed by all the Banks affected by such amendment or waiver, (i)
increase the Commitment of any Bank or subject any Bank to any additional
obligation, (ii) reduce the principal of or rate of interest on any Loan or
any fees hereunder, (iii) postpone the date fixed for any payment of
principal of or interest on any Loan or any fees hereunder, or (iv) alter the
absolute and unconditional character of the ABI Guarantee or the guarantee of
the Company contained in Article IX, and no such amendment or waiver shall,
unless signed by all the Banks, change the percentage of the Total Commitment
or of the aggregate unpaid principal amount of the Loans, or the number of
Banks, which shall be required for the Banks or any of them to take any
action under this Section or any other provision of this Agreement. Each
Eligible Subsidiary, by its execution of an Election to Participate, grants
to the Company an irrevocable power of attorney to enter into amendments or
waivers of this Agreement on behalf of such Eligible Subsidiary, and agrees
that it shall be bound by any such amendment or waiver executed by the
Company, whether or not such amendment or waiver is executed by the Company
in the name of such Eligible Subsidiary.
Section 10.06. Successors and Assigns. (a) The provisions of
----------------------
this Agreement shall be binding upon and inure to the benefit of the parties
hereto and their respective successors and assigns, except that (i) neither
the Company nor ABI may assign or otherwise transfer any of its rights under
this Agreement without the prior written consent of all Banks and (ii) no
Bank may assign or otherwise transfer its Commitment in whole or in part, or
sell, assign or otherwise transfer its Loans or grant participations in its
Loans or rights under this Agreement in whole or in part, other than as the
result of the designation of a different Lending Office in accordance with
this Agreement or as permitted under Section 8.05, 10.04 and the following
provisions of this Section.
(b) Any Bank may at any time grant to one or more banks or other
institutions (each a "Participant") participating interests in its Commitment
-----------
or any or all of its Loans; provided that such Bank shall, except in the case
--------
of such a grant (i) pursuant to Section 10.04, (ii) in respect of Money
Market Loans or (iii) to a Bank Affiliate, obtain the Company's prior consent
to such grant. In the event of any such grant by a Bank of a participating
interest to a
<PAGE>
<PAGE> 57
56
Participant, whether or not upon notice to the Company and the Administrative
Agent, such Bank shall remain responsible for the performance of its
obligations hereunder, and the Company, each other Borrower and the
Administrative Agent shall continue to deal solely and directly with such
Bank in connection with such Bank's rights and obligations under this
Agreement. Any agreement pursuant to which any Bank may grant such a
participating interest shall provide that such Bank shall retain the sole
right and responsibility to enforce the obligations of the Company and each
other Borrower hereunder including, without limitation, the right to approve
amendments, modifications or waivers of the provisions of this Agreement as
set forth in this Section; provided that such participation agreement may
--------
provide that such Bank will not agree to any modification, amendment or
waiver of this Agreement described in clause (i), (ii) or (iii) of Section
10.05(b) without the consent of the Participant. The Company agrees that
each Participant shall, to the extent provided in its participation agreement
and subject to subsection (e) of this Section, be entitled to the benefits of
Article VIII with respect to its participating interest.
(c) Any Bank may at any time assign to one or more banks or other
institutions (each an "Assignee") all, or a proportionate part of all, of its
--------
rights and obligations under this Agreement, and such Assignee shall assume
such rights and obligations, pursuant to an Assignment and Acceptance in
substantially the form of Exhibit I hereto executed by such Assignee and such
transferor Bank, with (and subject to) the consent of the Company and the
Administrative Agent (which consents shall not be required in the case of an
assignment (A) by a Bank to any other Bank so long as such assignment does
not (x) cause the aggregate amount of the Commitments of any Bank and its
Bank Affiliates to exceed $300,000,000 or (y) increase the amount of the
Commitments of any Bank and its Bank Affiliates if the aggregate amount of
the Commitments of such Bank and its Bank Affiliates exceeds $300,000,000
immediately prior to such assignment or (B) by a Bank to its Bank Affiliate
so long as (v) if such transferor Bank is a "depository institution" (within
the meaning of Regulation A of the Board of Governors of the Federal Reserve
System), such Bank Affiliate shall also be a depository institution and
(w) at the time of such assignment S&P or Moody's shall rate the senior,
unsecured, long-term debt of such transferor Bank and the rating or ratings
for senior, unsecured, long-term debt of such Bank Affiliate by S&P and/or
Moody's, as applicable, shall not be lower than such rating(s) of such
transferor Bank); provided that (i) such assignment may, but need not,
--------
include rights of the transferor Bank in respect of outstanding Money Market
Loans; (ii) except in the case of an assignment to a Bank or a Bank Affiliate
or an assignment of the entire remaining amount of the transferor Bank's
Commitment and outstanding Loans, the amount of such assignment shall not
be less than $5,000,000 and (iii) the Assignee, if it shall not be a Bank,
shall deliver to the Administrative Agent an Administrative Questionnaire.
Upon execution and delivery of such instrument and payment by such Assignee
to such transferor Bank of an amount equal to the purchase price agreed
between such transferor Bank and such Assignee, such Assignee shall be a Bank
party to this Agreement and shall have all the rights and obligations of a
Bank with a Commitment as set forth in such instrument of assumption, and the
transferor Bank shall be released from its obligations hereunder to a
corresponding extent, and no further consent or action by any party shall be
required. In connection with any such assignment, the transferor Bank or
such Assignee shall pay to the Administrative Agent an administrative fee for
processing such assignment in the amount of $3,500. If the Assignee is not
incorporated under the laws of
<PAGE>
<PAGE> 58
57
the United States or a state thereof, it shall, prior to the first date on
which interest or fees are payable hereunder for its account, deliver to the
Company and the Administrative Agent certification as to exemption from
deduction or withholding of any United States federal income taxes in
accordance with Section 2.15.
Notwithstanding anything to the contrary contained herein, any
Bank (a "Granting Bank") may grant to a special purpose vehicle (an "SPV")
------------- ---
of such Granting Bank, identified as such in writing from time to time by
the Granting Bank to the Administrative Agent and the Company, the option to
provide to any Borrower all or any part of any Loan that such Granting Bank
would otherwise be obligated to make to such Borrower hereunder, provided
--------
that (i) nothing herein shall constitute a commitment by any SPV to make any
Loan, (ii) if an SPV elects not to exercise such option or otherwise fails to
provide all or any part of such Loan, the Granting Bank shall be obligated to
make such Loan pursuant to the terms hereof and (iii) any Borrower may bring
any proceeding against the Granting Bank in order to enforce any rights of
such Borrower hereunder. The making of a Loan by an SPV hereunder shall
utilize the Commitment of the Granting Bank to the same extent, and as if,
such Loan were made by the Granting Bank. Each party hereto hereby agrees
that no SPV shall be liable for any payment under this Agreement for which
a Bank would otherwise be liable, for so long as, and to the extent that,
the related Granting Bank makes such payment. In furtherance of the
foregoing, each party hereto hereby agrees (which agreement shall survive
the termination of this Agreement) that, prior to the date that is one year
and one day after the payment in full of all outstanding commercial paper
or other senior indebtedness of any SPV, it will not institute against,
or join any other person in instituting against, such SPV any bankruptcy,
reorganization, arrangement, insolvency or liquidation proceedings or
similar proceedings under the laws of the United States or any State
thereof in respect of any claim arising under this Agreement. In addition,
notwithstanding anything to the contrary contained in this Section, any SPV
may, with the prior written consent of the Company and the Administrative
Agent (to the extent such consent is required under the immediately preceding
paragraph of this subsection (c)) but without paying any processing fee
therefor, assign all or a portion of its interests in any Loans to the
Granting Bank or to any financial institutions providing liquidity and/or
credit to or for the account of such SPV to fund the Loans made by such SPV
or to support the securities (if any) issued by such SPV and such SPV may
disclose, on a confidential basis, confidential information with respect to
the Company and its Subsidiaries to any rating agency, commercial paper
dealer or provider of a surety, guarantee or credit liquidity enhancement to
such SPV. This paragraph may not be amended without the consent of any SPV
at the time holding Loans under this Agreement.
(d) Any Bank may at any time assign all or any portion of its
rights under this Agreement to secure obligations of such Bank, including,
without limitation, to a Federal Reserve Bank, provided that any foreclosure
--------
or similar action taken with respect to such assignment to any Person other
than a Federal Reserve Bank shall be subject to the provisions of this
Section concerning assignments. No such assignment shall release the
transferor Bank from its obligations hereunder.
(e) No Assignee, Participant or other transferee of any Bank's
rights shall be entitled to receive any greater payment under Section 8.03
than such Bank would have been
<PAGE>
<PAGE> 59
58
entitled to receive with respect to the rights assigned or otherwise
transferred, unless such assignment or transfer is made (i) with the prior
consent of the Company, (ii) by reason of the provisions of Section 8.02 or
8.03 requiring such Bank to designate a different Lending Office under
certain circumstances or (iii) at a time when the circumstances giving rise
to such greater payment did not exist.
(f) If the Fixed Rate Loans of any Reference Bank are repaid
pursuant to Article VIII, the Administrative Agent shall, with the consent
of the Company and the Required Banks, appoint another Bank to act as a
Reference Bank hereunder.
(g) The Administrative Agent, acting solely for this purpose as an
agent of the Company, shall maintain at one of its offices in New York City a
copy of each Assignment and Acceptance delivered to it and a register for the
recordation of the names and addresses of the Banks, and the Commitments of,
and principal amount of the Loans owing to, each Bank pursuant to the terms
hereof from time to time (the "Register"). The entries in the Register shall
--------
be conclusive, and the Company, the Administrative Agent and the Banks may
treat each Person whose name is recorded in the Register pursuant to the
terms hereof as a Bank hereunder for all purposes of this Agreement,
notwithstanding notice to the contrary. The Register shall be available for
inspection by the Company, any other Borrower and any Bank, at any reasonable
time and from time to time upon reasonable prior notice.
Section 10.07. Collateral. Each of the Banks represents and
----------
warrants to the Administrative Agent and to the other Banks that it in good
faith is not relying on any "margin stock" (as defined in Regulation U of the
Board of Governors of the Federal Reserve System) as collateral in the
extension or maintenance of the credit provided for in this Agreement.
Section 10.08. New York Law; Submission to Jurisdiction. This
----------------------------------------
Agreement and any other document delivered hereunder shall be construed in
accordance with and governed by the law of the State of New York. Each of
the Company, ABI and the Eligible Subsidiaries hereby submits to the
nonexclusive jurisdiction of the United States District Court for the
Southern District of New York and of any New York State court sitting in New
York City for purposes of all legal proceedings arising out of or relating to
this Agreement or the transactions contemplated hereby. Each of the Company,
ABI and the Eligible Subsidiaries irrevocably waives, to the fullest extent
permitted by law, any objection which it may now or hereafter have to the
laying of the venue of any such proceeding brought in such a court and any
claim that any such proceeding brought in such a court has been brought in an
inconvenient forum.
Section 10.09. Counterparts; Effectiveness. This Agreement may be
---------------------------
signed in any number of counterparts, each of which shall be an original,
with the same effect as if the signatures thereto and hereto were upon the
same instrument. This Agreement shall become effective when the
Administrative Agent shall have received counterparts hereof signed by each
of the parties hereto (or, in the case of any Bank as to which an executed
counterpart shall not have been received, receipt by the Administrative Agent
in form satisfactory to it of telecopy or other written confirmation from
such Bank of execution of a counterpart hereof by such Bank) and when the
conditions specified in Section 3.02 shall have been satisfied or waived.
<PAGE>
<PAGE> 60
59
Section 10.10. Independence of Covenants. All covenants hereunder
-------------------------
shall be given independent effect so that if a particular action or condition
is not permitted by any of such covenants, the fact that it would be
permitted by an exception to, or be otherwise within the limitations of,
another covenant shall not avoid the effectiveness of the first covenant.
Section 10.11. WAIVER OF JURY TRIAL. EACH OF THE COMPANY, ABI,
--------------------
THE ELIGIBLE SUBSIDIARIES, THE ADMINISTRATIVE AGENT AND THE BANKS HEREBY
IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING
ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED
HEREBY.
Section 10.12. Waiver Under Pre-Existing Credit Agreements.
-------------------------------------------
By its execution hereof, each undersigned Bank that also is a party to the
credit agreement referred to in clause (f) of Section 3.02 hereby waives the
provisions of such credit agreement that would require advance notice for the
termination of commitments thereunder or the prepayment of loans thereunder;
provided that (a) the foregoing waiver shall apply only to the termination
- --------
of all commitments under such credit agreement and repayment of all loans
outstanding thereunder in connection with the effectiveness of this Agreement
and (b) the Company shall, in lieu of advance notice of any such termination
or prepayment, give notice thereof to the Agent (as defined in such credit
agreement) on the date of such termination or prepayment.
Section 10.13. Action by the Company on Behalf of the Borrowers.
------------------------------------------------
Any payment obligation or other obligation of any Borrower hereunder may be
performed by the Company on behalf of such Borrower, and such performance by
the Company shall be deemed to satisfy the corresponding obligation of such
Borrower hereunder.
Section 10.14. Survival. All covenants, agreements, representations
--------
and warranties made by the Company, ABI or any other Borrower herein and in
the certificates or other instruments delivered in connection with or
pursuant to this Agreement shall be considered to have been relied upon by
the other parties hereto and shall survive the execution and delivery of this
Agreement and the making of any Loans, regardless of any investigation made
by any such other party or on its behalf and notwithstanding that the
Administrative Agent or any Bank may have had notice or knowledge of any
Default or incorrect representation or warranty at the time any credit is
extended hereunder, and shall continue in full force and effect as long as
the principal of or any accrued interest on any Loan or any fee or any other
amount payable under this Agreement is outstanding and unpaid and so long as
the Commitments have not expired or terminated. The provisions of Sections
2.13, 2.15, 8.03, 9.03 and 10.03 and Article VII shall survive and remain in
full force and effect regardless of the consummation of the transactions
contemplated hereby, the repayment of the Loans, the expiration or
termination of the Commitments or the termination of this Agreement or any
provision hereof.
<PAGE>
<PAGE> 61
60
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed by their respective authorized officers as of the day and
year first above written.
ANHEUSER-BUSCH COMPANIES, INC.
By: /s/ William J. Kimmins, Jr.
---------------------------
Name: William J. Kimmins, Jr.
Title: Vice President and Treasurer
Address for Notices:
One Busch Place
St. Louis, Missouri 63118
Telecopy: 314-577-2329
Telephone: 314-865-9005
Attention: Vice President and Treasurer
ANHEUSER-BUSCH, INCORPORATED
By: /s/ William J. Kimmins, Jr.
---------------------------
Name: William J. Kimmins, Jr.
Title: Treasurer
Address for Notices:
One Busch Place
St. Louis, Missouri 63118
Telecopy: 314-577-2329
Telephone: 314-865-9005
Attention: Treasurer
<PAGE>
<PAGE> 62
61
THE CHASE MANHATTAN BANK, as
Administrative Agent
By: /s/ Randolph E. Cates
-------------------------
Name: Randolph E. Cates
Title: Vice President
Address for Notices:
270 Park Avenue
New York, New York 10017
Attention: Randolph Cates
Telecopy: 212-270-1403
Telephone: 212-270-8997
BANKS
-----
THE CHASE MANHATTAN BANK
By: /s/ Randolph E. Cates
-------------------------
Name: Randolph E. Cates
Title: Vice President
BANK ONE, NA (Main Office Chicago)
By: /s/ Michael V. Rhodes
-------------------------
Name: Michael V. Rhodes
Title: Vice President
CITIBANK, N.A.
By: /s/ David L. Harris
-------------------------
Name: David L. Harris
Title: Vice President
<PAGE>
<PAGE> 63
62
THE INDUSTRIAL BANK OF JAPAN, LIMITED
By: /s/ Walter R. Wolff
-------------------------
Name: Walter R. Wolff
Title: Joint General Manager
BANK OF AMERICA, N.A.
By: /s/ Greg McCrery
-------------------------
Name: Greg McCrery
Title: Vice President
UBS AG, STAMFORD BRANCH
By: /s/ Paula Mueller
-------------------------
Name: Paula Mueller
Title: Director
By: /s/ Dorothy McKinley
-------------------------
Name: Dorothy McKinley
Title: Director
Loan Portfolio Support, US
REVOLVING COMMITMENT VEHICLE
CORPORATION
By: Morgan Guaranty Trust Company of New
York, as Attorney-In-Fact for Revolving
Commitment Vehicle Corporation
By: /s/ David P. Weintrob
-------------------------
Name: David P. Weintrob
Title: Vice President
<PAGE>
<PAGE> 64
63
MELLON BANK, N.A.
By: /s/ Louis E. Flori
-------------------------
Name: Louis E. Flori
Title: Vice President
DEUTSCHE BANK AG NEW YORK BRANCH
AND/OR CAYMAN ISLANDS BRANCH
By: /s/ Alexander Karow
-------------------------
Name: Alexander Karow
Title: Vice President
By: /s/ Sheryl L. Paynter
-------------------------
Name: Sheryl L. Paynter
Title: Vice President
SUNTRUST BANK
By: /s/ Charles J. Johnson
-------------------------
Name: Charles J. Johnson
Title: Managing Director
WELLS FARGO BANK, NATIONAL
ASSOCIATION
By: /s/ Irene Geller Hale
-------------------------
Name: Irene Geller Hale
Title: Vice President
By: /s/ Melissa Nachman
-------------------------
Name: Melissa Nachman
Title: Vice President
<PAGE>
<PAGE> 65
64
ABN AMRO BANK N.V.
By: /s/ John E. Robertson
-------------------------
Name: John E. Robertson
Title: Group Vice President
By: /s/ Scott J. Albert
-------------------------
Name: Scott J. Albert
Title: Group Vice President
THE BANK OF NEW YORK
By: /s/ David G. Shedd
-------------------------
Name: David G. Shedd
Title: Vice President
HUNTINGTON NATIONAL BANK
By: /s/ Timothy R. McLaughlin
-------------------------
Name: Timothy R. McLaughlin
Title: Vice President
FIRSTAR BANK, N.A.
By: /s/ John H. Phillips
-------------------------
Name: John H. Phillips
Title: Vice President
<PAGE>
<PAGE> 66
SCHEDULE I
COMMITMENTS
BANK COMMITMENT
THE CHASE MANHATTAN BANK $250,000,000
BANK ONE, NA $225,000,000
CITIBANK, N.A. $225,000,000
THE INDUSTRIAL BANK OF JAPAN, LIMITED $225,000,000
BANK OF AMERICA, N.A. $175,000,000
UBS AG, STAMFORD BRANCH $175,000,000
REVOLVING COMMITMENT VEHICLE CORPORATION $175,000,000
MELLON BANK, N.A. $100,000,000
DEUTSCHE BANK AG NEW YORK BRANCH AND/OR CAYMAN ISLANDS BRANCH $100,000,000
SUNTRUST BANK $100,000,000
WELLS FARGO BANK, NATIONAL ASSOCIATION $50,000,000
ABN AMRO BANK N.V. $50,000,000
THE BANK OF NEW YORK $50,000,000
HUNTINGTON NATIONAL BANK $50,000,000
FIRSTAR BANK, N.A. $50,000,000
<PAGE>
<PAGE> 67
EXHIBIT A
NOTE
New York, New York
_________, 200_
For value received, [ANHEUSER-BUSCH COMPANIES, INC.][NAME OF ELIGIBLE
SUBSIDIARY], a _________ Delaware corporation (the "Borrower"), promises to
--------
pay to the order of ______________ (the "Bank"), for the account of its
----
Lending Office, the unpaid principal amount of each Loan made by the Bank to
the Borrower pursuant to the Credit Agreement referred to below on the last
day of the Interest Period relating to such Loan. The Borrower promises to
pay interest on the unpaid principal amount of each such Loan on the dates
and at the rate or rates provided for in the Credit Agreement. All such
payments of principal and interest shall be made in lawful money of the
United States in Federal or other immediately available funds at the office
of The Chase Manhattan Bank, 270 Park Avenue, New York, New York 10017;
provided that all payments of principal of and interest on any Negotiated
- --------
Rate Loan advanced by the Bank in a currency other than U.S. Dollars shall be
made in the currency in which such Negotiated Rate Loan is denominated at
such location as agreed with the Bank.
All Loans made by the Bank, the respective types and maturities thereof
and all repayments of the principal thereof shall be recorded by the Bank
and, prior to any transfer hereof, appropriate notations to evidence the
foregoing information with respect to each such Loan then outstanding shall
be endorsed by the Bank on the schedule attached hereto, or on a continuation
of such schedule attached to and made a part hereof; provided that the
--------
failure of the Bank to make any such recordation or endorsement shall not
affect the obligations of the Borrower hereunder or under the Credit
Agreement.
This note is one of the Notes referred to in the Credit Agreement dated
as of June 30, 2000 (as amended from time to time, the "Credit Agreement"),
----------------
among [the Borrower][Anheuser-Busch Companies, Inc. (the "Company")],
-------
Anheuser-Busch, Incorporated, as Guarantor ("ABI"), the Banks party thereto
---
and The Chase Manhattan Bank, as Administrative Agent. Terms defined in the
Credit Agreement are used herein with the same meanings. Reference is made
to the Credit Agreement for provisions for the prepayment, the acceleration
of the maturity and the limitations on the transferability of this Note.
[ANHEUSER-BUSCH COMPANIES, INC.]
[NAME OF ELIGIBLE SUBSIDIARY]
By _________________________________
Name:
Title:
<PAGE>
<PAGE> 68
2
Note (cont'd)
<TABLE>
LOANS AND PAYMENTS OF PRINCIPAL
<CAPTION>
___________________________________________________________________________________________________________
<S> <C> <C> <C> <C> <C> <C>
Date Amount of Type of Currency* Amount of Maturity Notation
Loan Loan Principal Date Made By
Repaid
___________________________________________________________________________________________________________
___________________________________________________________________________________________________________
___________________________________________________________________________________________________________
___________________________________________________________________________________________________________
___________________________________________________________________________________________________________
___________________________________________________________________________________________________________
___________________________________________________________________________________________________________
___________________________________________________________________________________________________________
___________________________________________________________________________________________________________
___________________________________________________________________________________________________________
___________________________________________________________________________________________________________
___________________________________________________________________________________________________________
___________________________________________________________________________________________________________
___________________________________________________________________________________________________________
___________________________________________________________________________________________________________
___________________________________________________________________________________________________________
<FN>
- -----------------------------
* Only applicable to Negotiated Rate Loans made in a currency other than U.S.
dollars.
</FN>
</TABLE>
<PAGE>
<PAGE> 69
EXHIBIT B
Form of Money Market Quote Request
----------------------------------
[Date]
To: The Chase Manhattan Bank (the "Administrative Agent")
--------------------
From: Anheuser-Busch Companies, Inc.
Re: Credit Agreement dated as of June 30, 2000 among Anheuser-Busch
Companies, Inc., Anheuser-Busch, Incorporated, the Banks party thereto
and the Administrative Agent (as amended from time to time, the
"Credit Agreement")
----------------
We hereby give notice pursuant to Section 2.04 of the Credit Agreement
that we request Money Market Quotes for the following proposed Money Market
Borrowing(s):
Date of Borrowing: ____________________
Principal Amount: 1 ____________________
Interest Period: 2 ____________________
[Borrower: ____________________]
Such Money Market Quotes should offer a Money Market [Margin]
[Absolute Rate]. [The applicable base rate is the LIBO Rate.]
Terms used herein have the meanings assigned to them in the Credit
Agreement.
ANHEUSER-BUSCH COMPANIES, INC.
By _________________________________
Name:
Title:
[FN]
- -----------------------------
1 Amount must be $10,000,000 or a larger multiple of $1,000,000.
2 Not less than 7 days, subject to the provisions of the definition of
Interest Period.
</FN>
<PAGE>
<PAGE> 70
EXHIBIT C
Form of Invitation for Money Market Quotes
------------------------------------------
To: [Name of Bank]
Re: Invitation for Money Market Quotes to Anheuser-Busch, Companies, Inc.
(the "Company")
-------
Pursuant to Section 2.04 of the Credit Agreement dated as of June 30,
2000, among the Company., Anheuser-Busch, Incorporated, the Banks party
thereto and the undersigned, as Administrative Agent, we are pleased on
behalf of the Company to invite you to submit Money Market Quotes to the
Company for the following proposed Money Market Borrowing(s):
Date of Borrowing: ____________________
Principal Amount: ____________________
Interest Period: ____________________
[Borrower: ____________________]
Such Money Market Quotes should offer a Money Market [Margin]
[Absolute Rate]. [The applicable base rate is the LIBO Rate.]
Please respond to this invitation by no later than [9:30 a.m.]
[10:00 a.m.] (New York City time) [date].
THE CHASE MANHATTAN BANK
By _________________________________
Name:
Title:
<PAGE>
<PAGE> 71
EXHIBIT D
Form of Money Market Quote
--------------------------
THE CHASE MANHATTAN BANK,
as Administrative Agent
270 Park Avenue
New York, New York 10017
Attention:
Re: Money Market Quote to Anheuser-Busch Companies, Inc. (the "Company")
-------
In response to your invitation on behalf of the Company dated
____________, we hereby make the following Money Market Quote on the
following terms:
1. Quoting Bank: ____________________________________________
2. Person to contact at Quoting Bank: ________________________
3. Date of Borrowing: _______________________________________1
4. We hereby offer to make Money Market Loan(s) in the following principal
amounts, for the following Interest Periods and at the following rates:
[FN]
- -----------------------------
1 As specified in the related Invitation.
</FN>
<PAGE>
<PAGE> 72
2
Principal Interest [Money Market [Absolute Rate 5]
Amount 2 Period 3 Margin 4] ---------------
-------- -------- --------
$
$
[Provided, that the aggregate principal amount of Money Market Loans
for which the above offers may be accepted shall not exceed $__________.]
We understand and agree that the offer(s) set forth above, subject to the
satisfaction of the applicable conditions set forth in the Credit Agreement
dated as of June 30, 2000, among the Company, Anheuser-Busch, Incorporated,
the Banks party thereto and yourselves, as Administrative Agent, irrevocably
obligate us to make the Money Market Loan(s) for which any offer(s) are
accepted, in whole or in part.
Very truly yours,
[NAME OF BANK]
Dated: ________________ By __________________________
Name:
Title:
[FN]
- -----------------------------
2 Principal amount bid for each Interest Period may not exceed principal
amount requested. Specify aggregate limitation if the sum of the individual
offers exceeds the amount the Bank is willing to lend. Bids must be made for
$10,000,000 or a larger multiple of $1,000,000.
3 Not less than 7 days, as specified in the related Invitation. No more
than five bids are permitted for each Interest Period.
4 Margin over or under the LIBO Rate determined for the applicable
Interest Period. Specify percentage (to the nearest 1/10,000th of 1%) and
specify whether "PLUS" or "MINUS".
5 Specify rate of interest per annum (expressed to 1/10,000th of 1%).
</FN>
<PAGE>
<PAGE> 73
EXHIBIT E
Notice of Money Market Borrowing
--------------------------------
THE CHASE MANHATTAN BANK,
as Administrative Agent
270 Park Avenue
New York, New York 10017
Attention:
Re: Money Market Quotes to
Anheuser-Busch Companies, Inc.
Pursuant to Section 2.04 of the Credit Agreement dated as of June
30, 2000 (as amended from time to time, the "Credit Agreement"), among the
----------------
undersigned, Anheuser-Busch, Incorporated, the Banks party thereto and The
Chase Manhattan Bank, as Administrative Agent, and in response to the Money
Market Quotes dated ___________ and obtained by you on our behalf, we hereby
accept the following Money Market Quote(s) on the following terms:
1. Quoting Bank: ________________________________________________________
2. Person to contact at Quoting Bank: ___________________________________
3. Date of Borrowing: ___________________________________________________
4. We hereby accept Money Market Loan(s) in the following principal
amounts, for the following Interest Periods, and at the following
rates: 1
[FN]
- -----------------------------
1 Acceptance may only be made on the basis of ascending Money Market
Absolute Rates or Money Market Margins, as the case may be.
</FN>
<PAGE>
<PAGE> 74
2
Principal Interest [Money Market [Absolute Rate 5]
Amount 2 Period 3 Margin 4] ---------------
-------- -------- --------
$
$
Terms used herein have the meanings assigned to them in the Credit
Agreement.
ANHEUSER-BUSCH COMPANIES, INC.
By _________________________________
Name:
Title:
[FN]
- -----------------------------
2 Principal amount accepted for each Interest Period may not exceed
principal amount requested. Acceptances must be in the amount of $10,000,000
or a larger multiple of $1,000,000.
3 As specified in the related Money Market Quote.
4 Margin above or below (as specified) the applicable LIBO Rate,
expressed as a percentage to be added to or subtracted from such base rate.
5 Rate of interest per annum, as specified in the related Money Market
Quote.
</FN>
<PAGE>
<PAGE> 75
EXHIBIT F
Opinion of Associate General Counsel of the Company
314/577-3298
Fax 314/577-0776
thomas.larson@anheuser-busch.com
[______], 2000
TO THE BANKS AND THE ADMINISTRATIVE AGENT
Referred to below
c/o The Chase Manhattan Bank
270 Park Avenue
New York, New York 10017
Re: Credit Agreement dated as of June 30, 2000 among Anheuser-Busch
Companies, Inc., Anheuser-Busch, Incorporated, the Banks listed
therein and The Chase Manhattan Bank, as Administrative Agent
("Credit Agreement")
Ladies and Gentlemen:
I am an Associate General Counsel of Anheuser-Busch Companies, Inc., a
Delaware corporation ("ABC"), and have represented ABC and Anheuser-Busch,
Incorporated in connection with their execution and delivery of the Credit
Agreement. Unless otherwise indicated, terms used herein shall have the
meanings assigned to them in the Credit Agreement. This opinion letter is
limited to the laws of the State of Missouri, the laws of the State of New
York, the corporate law of the State of Delaware and the federal law of the
United States.
I have examined such documents, records and matters of law and have made
such inquiries as I have deemed necessary for purposes of this opinion
letter, and based thereupon I am of the opinion that:
(1) ABC and ABI are each corporations duly incorporated, validly
existing and in good standing under the laws of their respective
jurisdictions with the requisite corporate power and authority to conduct
their businesses as now being conducted and to execute, deliver and perform
their obligations under the Credit Agreement and the Guarantee Fee Agreement.
(2) ABC and ABI have duly authorized, executed and delivered the Credit
Agreement and the Guaranty Fee Agreement, and they constitute valid and
binding obligations of ABC and ABI, enforceable against them in accordance
with their terms, except as such enforceability may be limited by bankruptcy
and other similar laws affecting creditors' rights generally as in effect
<PAGE>
<PAGE> 76
Page 2
from time to time and general principles of equity (whether considered in a
proceeding in equity or at law).
(3) The execution and delivery by ABC and ABI, and the performance of
their obligations under, the Credit Agreement and the Guaranty Fee Agreement
do not conflict with their charters or bylaws, any applicable law (including
without limitation the provisions of Regulation U or X of the Board of
Governors of the Federal Reserve System) or any judgment, order, decree or
injunction known to me of any governmental body and will not constitute a
default or create any Lien on any asset of the Company or its Subsidiaries
under any indenture, mortgage or other agreement or instrument known to me to
which ABC, ABI or any of their property is bound.
(4) ABC and ABI are not required to obtain any consent or approval from,
or make any filing with, any governmental agency in connection with their
execution and delivery of, or the performance of their obligations under, the
Credit Agreement and the Guarantee Fee Agreement.
(5) There is no litigation, governmental proceeding, action, suit or
arbitration pending or, to my knowledge, threatened against ABC or any of its
Subsidiaries that would reasonably be expected to have a material adverse
effect on the validity or enforceability of the Credit Agreement or the
Guarantee Fee Agreement, the ability of ABC or ABI to perform its obligations
thereunder or upon the consolidated financial position of ABC.
(6) Neither ABC nor ABI is an "investment company" or a company
"controlled" by an "investment company" as such terms are defined in the
Investment Company Act of 1940, as amended.
This opinion letter is furnished by me, as counsel for ABC and ABI, in
connection with the execution and delivery of the Credit Agreement and the
Guarantee Fee Agreement, upon the understanding that I am not otherwise
assuming any professional responsibility.
Very truly yours,
Thomas Larson
Associate General Counsel
<PAGE>
<PAGE> 77
EXHIBIT G
[Form of Opinion of Special New York Counsel to Chase]
[______], 2000
To the Banks party to the Credit Agreement referred
to below and The Chase Manhattan Bank, as
Administrative Agent
Ladies and Gentlemen:
We have acted as special New York counsel to The Chase Manhattan
Bank ("Chase") in connection with the Credit Agreement (the "Credit
----- ------
Agreement") dated as of June 30, 2000, among Anheuser-Busch Companies, Inc.
- ---------
(the "Company"), Anheuser-Busch, Incorporated ("ABI"), the lenders party
------- ---
thereto and Chase, as Administrative Agent, providing for loans to be made by
said lenders to the Borrowers (as defined in the Credit Agreement) in an
aggregate principal amount at any one time outstanding not exceeding
$2,000,000,000. Terms defined in the Credit Agreement are used herein as
defined therein. This opinion letter is being delivered pursuant to Section
3.02(b) of the Credit Agreement.
In rendering the opinions expressed below, we have examined the
Credit Agreement. In our examination, we have assumed the genuineness of all
signatures, the authenticity of the original Credit Agreement and the
conformity with the original Credit Agreement of any copies thereof. When
relevant facts were not independently established, we have relied upon
representations made in or pursuant to the Credit Agreement.
In rendering the opinions expressed below, we have assumed that:
(i) the Credit Agreement has been duly authorized by, has been
duly executed and delivered by, and (except to the extent set forth in
the opinions expressed below as to the Company and ABI) constitutes
legal, valid, binding and enforceable obligations of, all of the parties
thereto;
(ii) all signatories to the Credit Agreement have been duly
authorized; and
(iii) all of the parties to the Credit Agreement are duly organized
and validly existing and have the power and authority (corporate or
other) to execute, deliver and perform the Credit Agreement.
Based upon and subject to the foregoing and subject also to the
comments and qualifications set forth below, and having considered such
questions of law as we have deemed necessary as a basis for the opinions
expressed below, we are of the opinion that the Credit Agreement constitutes
the legal, valid and binding obligation of the Company and ABI, enforceable
against the Company and ABI in accordance with its terms, except as may be
limited by bankruptcy, insolvency, reorganization, fraudulent conveyance or
transfer, moratorium or other similar laws relating to or affecting the
rights of creditors generally and except as the enforceability of the Credit
Agreement is subject to the application of general principles of equity
<PAGE>
<PAGE> 78
Page 2
(regardless of whether considered in a proceeding in equity or at law),
including (a) the possible unavailability of specific performance, injunctive
relief or any other equitable remedy and (b) concepts of materiality,
reasonableness, good faith and fair dealing.
The foregoing opinions are subject to the following comments and
qualifications:
(A) The enforceability of Section 10.03 of the Credit Agreement may
be limited by (i) laws rendering unenforceable indemnification contrary
to Federal or state securities laws and the public policy underlying such
laws and (ii) laws limiting the enforceability of provisions exculpating
or exempting a party, or requiring indemnification of a party for,
liability for its own action or inaction, to the extent the action or
inaction involves gross negligence, recklessness, willful misconduct or
unlawful conduct.
(B) The enforceability of provisions in the Credit Agreement to the
effect that terms may not be waived or modified except in writing may be
limited under certain circumstances.
(C) Section 9.02 of the Credit Agreement may not be enforceable to
the extent that the obligations of the Company or any Eligible Subsidiary
under the Credit Agreement are materially modified.
(D) We express no opinion as to (i) the effect of the laws of any
jurisdiction in which any Bank is located (other than the State of
New York) that limit the interest, fees or other charges such Bank may
impose, (ii) the last sentence of Section 10.04 of the Credit Agreement,
(iii) the second sentence of Section 10.08 of the Credit Agreement,
insofar as such sentence relates to the subject matter jurisdiction of
the United States District Court for the Southern District of New York to
adjudicate any controversy related to the Credit Agreement, and (iv) the
waiver of inconvenient forum set forth in the last sentence of Section
10.08 of the Credit Agreement with respect to proceedings in any Federal
Court.
(E) We express no opinion as to the applicability to the
obligations of ABI (or the enforceability of such obligations) of
Section 548 of the Bankruptcy Code, Article 10 of the New York Debtor
and Creditor Law or any other provision of law relating to fraudulent
conveyances, transfers or obligations.
(F) We point out with reference to obligations stated to be payable
in a currency other than U.S. Dollars that (i) a New York statute provides
that a judgment rendered by a court of the State of New York in respect
of an obligation denominated in any such other currency would be rendered
in such other currency and would be converted into U.S. Dollars at the
rate of exchange prevailing on the date of entry of such judgment and
(ii) a judgment rendered by a Federal court sitting in the State of
New York in respect of an obligation denominated in any such other
currency may be expressed in U.S. Dollars, but we express no opinion
as to the rate of exchange such Federal court would apply.
The foregoing opinions are limited to matters involving the Federal
laws of the United States of America and the law of the State of New York,
and we do not express any opinion as to the laws of any other jurisdiction.
<PAGE>
<PAGE> 79
Page 3
At the request of our client, this opinion letter is, pursuant
to Section 3.02(b) of the Credit Agreement, provided to you by us in our
capacity as special New York counsel to Chase and may not be relied upon by
any Person for any purpose other than in connection with the transactions
contemplated by the Credit Agreement without, in each instance, our prior
written consent.
Very truly yours,
WJM/WFC
<PAGE>
<PAGE> 80
EXHIBIT H
ANHEUSER-BUSCH COMPANIES, INC.
Calculations to Establish Compliance
For Delivery with
Financial Statements dated __________
Agreement Section Amounts as of Date
----------------- of Financial Statements
-----------------------
5.01(i) Consolidated Net Worth = $===================
and is not less than
$1,500,000,000.
<PAGE>
<PAGE> 81
EXHIBIT I
[Form of Assignment and Acceptance]
ASSIGNMENT AND ACCEPTANCE
Reference is made to the Credit Agreement dated as of June 30, 2000 (as
amended from time to time, the "Credit Agreement"), among Anheuser-Busch
----------------
Companies, Inc., Anheuser-Busch, Incorporated, the Banks named therein and
The Chase Manhattan Bank, as Administrative Agent for said Banks. Terms
defined in the Credit Agreement are used herein with the same meanings.
The Assignor named below hereby sells and assigns, without recourse, to
the Assignee named below, and the Assignee hereby purchases and assumes,
without recourse, from the Assignor, effective as of the Assignment Date set
forth below, the interests set forth below (the "Assigned Interest") in the
-----------------
Assignor's rights and obligations under the Credit Agreement, including the
interests set forth below in the Commitment of the Assignor on the Assignment
Date and the Loans owing to the Assignor which are outstanding on the
Assignment Date, together with unpaid interest accrued on the assigned Loans
to the Assignment Date, and the amount, if any, set forth below of the fees
accrued to the Assignment Date for account of the Assignor. The Assignee
hereby acknowledges receipt of a copy of the Credit Agreement. From and
after the Assignment Date (i) the Assignee shall be a party to and be bound
by the provisions of the Credit Agreement and, to the extent of the interests
assigned by this Assignment and Acceptance, have the rights and obligations
of a Bank thereunder and (ii) the Assignor shall, to the extent of the
interests assigned by this Assignment and Acceptance, relinquish its rights
and be released from its obligations under the Credit Agreement.
This Assignment and Acceptance is being delivered to the Administrative
Agent together with, if the Assignee is not already a Bank under the Credit
Agreement, an Administrative Questionnaire in the form supplied by the
Administrative Agent, duly completed by the Assignee. The
[Assignee/Assignor] shall pay the fee payable to the Administrative Agent
pursuant to Section 10.06(c) of the Credit Agreement.
This Assignment and Acceptance shall be governed by and construed in
accordance with the law of the State of New York.
Assignment and Acceptance
-------------------------
<PAGE>
<PAGE> 82
Date of Assignment:
Legal Name of Assignor:
Legal Name of Assignee:
Assignee's Address for Notices:
Effective Date of Assignment
("Assignment Date"):
---------------
Principal Amount
Assigned (and identifying
information as to individual
Negotiated Rate Loans and Money
Market Loans)
------------
Commitment Assigned: $
Syndicated Loans:
Negotiated Rate Loans:
Money Market Loans:
Fees Assigned (if any):
<PAGE>
<PAGE> 83
The terms set forth above and below are hereby agreed to:
[NAME OF ASSIGNOR] , as Assignor
------------------
By:_________________________
Name:
Title:
[NAME OF ASSIGNEE] , as Assignee
------------------
By:_________________________
Name:
Title:
The undersigned hereby consent to the within assignment: 1
ANHEUSER-BUSCH COMPANIES, INC.
By:_________________________
Name:
Title:
THE CHASE MANHATTAN BANK,
as Administrative Agent
By:_________________________
Name:
Title:
[FN]
- -----------------------------
1 Consents to be included to the extent required by Section 10.06(c) of
the Credit Agreement.
</FN>
<PAGE>
<PAGE> 84
EXHIBIT J
Guaranty Fee Agreement
----------------------
Anheuser-Busch Companies, Inc. ("ABC"), a Delaware corporation, and
---
Anheuser-Busch, Incorporated ("ABI"), a Missouri corporation which is a
---
wholly-owned subsidiary of ABC, are entering into this Guaranty Fee Agreement
in connection with the execution and delivery of the Credit Agreement dated
as of June 30, 2000 (as amended from time to time, the "Credit Agreement"),
----------------
among ABC, ABI, the Banks listed therein and The Chase Manhattan Bank, as
Administrative Agent.
In consideration of the anticipated benefits, direct and indirect, to ABI
as a result of the Loans to be made from time to time as provided in the
Credit Agreement, and in further consideration of the payment of the fee
hereinafter referred to, ABI is willing to become liable, as guarantor, in
respect of the Loans and the other obligations of ABC under the Credit
Agreement, including without limitation, ABC's guarantee under the Credit
Agreement of the Loans to Eligible Subsidiaries (as defined in the Credit
Agreement).
ABC has provided to ABI copies of the financial statements referred to in
Section 4.01(d) of the Credit Agreement. ABC confirms, for the benefit of
ABI, the representations set forth in Section 4.01 of the Credit Agreement.
Accordingly, ABI hereby agrees that it will execute and deliver the
Credit Agreement, and that the Credit Agreement shall be the binding
obligation of ABI, as guarantor, in accordance with its terms.
ABC agrees to pay to ABI, annually in arrears, a fee in consideration for
such guaranty, such fee to be equal to 1/10 of 1% per annum (calculated on
the basis of a 365 or 366 day year and actual days elapsed) of the average
outstanding principal amount of the Loans during such year. Such amounts
shall be calculated and paid prior to April 1 of each year in respect of the
preceding calendar year. Any failure by ABI to request such payment, or any
failure by ABC to make such payment, shall in no way limit or impair the
obligation of ABI in respect of the Credit Agreement.
To confirm their agreement as set forth above, ABC and ABI have executed
and delivered this Agreement as of June [__], 2000. This Agreement shall be
governed by and construed in accordance with the law of the State of New
York.
ANHEUSER-BUSCH, INCORPORATED ANHEUSER-BUSCH COMPANIES, INC.
By: ________________________________ By: ______________________________
Name: Name:
Title: Title:
<PAGE>
<PAGE> 85
EXHIBIT K
FORM OF ELECTION TO PARTICIPATE
-------------------------------
[Date]
THE CHASE MANHATTAN BANK,
as Administrative Agent
for the Banks named in the Credit Agreement
dated as of June 30, 2000 (as amended from
time to time, the "Credit Agreement") among
----------------
Anheuser-Busch Companies, Inc., Anheuser-Busch,
Incorporated, such Banks and such Administrative Agent
Dear Sirs:
Reference is made to the Credit Agreement described above. Terms not
defined herein which are defined in the Credit Agreement have for the
purposes hereof the meanings provided therein.
The undersigned, [name of Eligible Subsidiary], a [jurisdiction of
incorporation] corporation, elects to be an Eligible Subsidiary for purposes
of the Credit Agreement, effective from the date hereof until an Election to
Terminate shall have been delivered on behalf of the undersigned in
accordance with the Credit Agreement. The undersigned confirms that the
representations and warranties set forth in Section 4.02 of the Credit
Agreement are true and correct as to the undersigned as of the date hereof,
and the undersigned agrees to perform all the obligations of an Eligible
Subsidiary under, and to be bound in all respects by the terms of, the Credit
Agreement, as if the undersigned were a signatory party thereto. The
undersigned further acknowledges and agrees that the Company will act as
exclusive agent of and attorney-in-fact for the undersigned for all purposes
of the Credit Agreement, and in such capacity as agent the Company will have
the exclusive authority to provide notices under the Credit Agreement with
respect to any loans to be made to the undersigned. The undersigned shall be
bound by all agreements and actions entered into or taken by the Company
under or pursuant to the Credit Agreement. The appointment by the
undersigned of the Company to act as its agent and attorney-in-fact is
irrevocable, and the undersigned agrees to assume all risk of keeping itself
informed of the actions of the Company under the Credit Agreement, with the
understanding that the Administrative Agent and the Banks will be relying on
the foregoing in advancing Loans under the Credit Agreement.
<PAGE>
<PAGE> 86
This instrument shall be construed in accordance with and governed by the
law of the State of New York.
Very truly yours,
[NAME OF ELIGIBLE SUBSIDIARY]
By _____________________________
Name:
Title:
The undersigned confirms that [name of Eligible Subsidiary] is an
Eligible Subsidiary for purposes of the Credit Agreement described above.
ANHEUSER-BUSCH COMPANIES, INC.
By _____________________________
Name:
Title:
Receipt of the above Election to Participate is acknowledged on and as of
the date set forth above.
THE CHASE MANHATTAN BANK,
as Administrative Agent
By _____________________________
Name:
Title:
<PAGE>
<PAGE> 87
EXHIBIT L
FORM OF ELECTION TO TERMINATE
-----------------------------
[Date]
THE CHASE MANHATTAN BANK,
as Administrative Agent
for the Banks named in the Credit Agreement
dated as of June 30, 2000 (as amended from
time to time, the "Credit Agreement") among
----------------
Anheuser-Busch Companies, Inc., Anheuser-Busch,
Incorporated, such Banks and such Administrative Agent
Dear Sirs:
Reference is made to the Credit Agreement described above. Terms not
defined herein which are defined in the Credit Agreement have for the
purposes hereof the meanings provided therein.
The undersigned, Anheuser-Busch Companies, Inc., a Delaware corporation,
elects to terminate the status of [name of Eligible Subsidiary], a
[jurisdiction of incorporation] corporation (the "Designated Subsidiary"), as
---------------------
an Eligible Subsidiary for purposes of the Credit Agreement, effective as of
the date hereof. The undersigned represents and warrants that all principal
and interest on the Loans to the Designated Subsidiary and all other amounts
payable by such Designated Subsidiary pursuant to the Credit Agreement have
been paid in full on or prior to the date hereof. Notwithstanding the
foregoing, this Election to Terminate shall not affect any obligation of the
Designated Subsidiary under the Credit Agreement heretofore incurred.
This instrument shall be construed in accordance with and governed by the
law of the State of New York.
Very truly yours,
ANHEUSER-BUSCH COMPANIES, INC.
By _____________________________
Name:
Title:
<PAGE>
<PAGE> 88
Receipt of the above Election to Terminate is hereby acknowledged on and
as of the date set forth above.
THE CHASE MANHATTAN BANK,
as Administrative Agent
By _____________________________
Name:
Title:
<PAGE>
<PAGE> 89
SCHEDULE 4.01(k)
UNRESTRICTED SUBSIDIARIES
Anheuser-Busch Asia, Inc.
Anheuser-Busch Australia Limited
Anheuser-Busch Brasil Holdings Ltda.
Anheuser-Busch Distributors of New York, Inc.
Anheuser-Busch Entertainment Limited
Anheuser-Busch Europe Limited
Anheuser-Busch Europe, Inc.
Anheuser-Busch Florida Investment Capital Corporation
Anheuser-Busch Import Investments, Inc.
Anheuser-Busch International Holdings, Inc.
Anheuser-Busch International, Inc.
Anheuser-Busch Investments, S.L.
Anheuser-Busch Latin American Development Corporation
Anheuser-Busch Mexico, Inc.
Anheuser-Busch River North Investment Capital Corporation
Anheuser-Busch Sales of Hawaii, Inc.
Anheuser-Busch Sales of South Bay, Inc.
Anheuser-Busch Spanish Holdings, Inc.
Anheuser-Busch Wholesaler Development Corp.
Anheuser-Busch Wholesaler Development Corporation III
Anheuser-Busch Wholesaler Development Corporation IV
Anheuser-Busch Wisconsin Investment Capital Corporation
Anheuser-Busch World Trade Ltd.
August A. Busch & Co. of Massachusetts, Inc.
BACI Holdings, Inc.
BACI, Inc.
BACI of Delaware, Inc.
Bannon Corporation
BARI-Canada, Inc.
Bevo Music, Inc.
Boardwalk and Baseball, Inc.
Bow Tie Music, Inc.
Budweiser Brasil Ltda.
Budweiser Japan Company, Ltd.
Budweiser Philippines, Inc.
Budweiser Wuhan International Brewing Company Limited
Busch Agricultural Resources International, Inc.
Busch Biotech, Inc.
Busch Creative Services Corporation
Busch Entertainment Corporation
Busch Foreign Sales Corporation
Busch International Sales Corporation
Busch Investment Corporation
Busch Mechanical Services, Inc.
<PAGE>
<PAGE> 90
Busch Media Group, Inc.
Busch Properties of Florida, Inc.
Busch Properties, Inc.
Capitol Beverage Sales Limited Partnership
Circle City Eagle Limited Partnership
City Beverages Limited Partnership
Civic Center Corporation
Coleridge Corporation
Consolidated Farms, Inc.
Daytona Beverages Limited Partnership
Eagle Brands of Houston Limited Partnership
Eagle Brands of South Texas Limited Partnership
Eagle I Limited Partnership
Eagle Midwest Limited Partnership
Eagle Snacks, Inc.
Eastern Shore Distributing Limited Partnership
Fairfield Transport, Inc.
Garrard Holding Co.
Garrard Leasing Company
Glass Container Corporation
Gold Coast Eagle Distributing Limited Partnership
HSH Of Orlando, Inc.
ILH Company
InnoVen IV Corporation
Kaasi Enterprises, L.L.C.
Kingsmill Realty, Inc.
Krajinska Investicni, spol. s r.o.
Litchfield Development Corporation
M.R.S. Redevelopment Corporation
M.R.S. Transport Company
Manufacturers Cartage Company
Manufacturers Railway Company
Metal Label Corporation
Nutri-Turf, Inc.
Packaging Business Services, Inc.
PBP, Inc.
Pestalozzi Street Insurance Company, Ltd.
PSB, Inc.
Puget Sound Beverages, Inc.
Screaming Eagle Limited Partnership
Sea World of Florida, Inc.
Sea World of Texas, Inc.
Sea World, Inc.
SFKBPP, Inc.
Somerset Distributors, LLC
Southern Eagle Sales and Service, L.P.
St. Louis Refrigerator Car Company
Stag Brewing Company Limited
Tune Out Music, Inc.
<PAGE>
<PAGE> 91
Twin City Distributors Limited Partnership
VacationLand Snacks Limited Partnership
Wholesaler Equity Development Corporation
Williamsburg Transport, Inc.
Wisconsin Distributors Limited Partnership
<PAGE>
<PAGE> 92
SCHEDULE 5.01(b)
Permitted Liens
---------------
NONE
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.3
<SEQUENCE>3
<FILENAME>eoex10p3.txt
<DESCRIPTION>EXHIBIT 10.3
<TEXT>
<PAGE> 1
ANHEUSER-BUSCH COMPANIES, INC.
STOCK PLAN FOR NON-EMPLOYEE DIRECTORS
Effective Date: October 1, 1999
(Restated to reflect a 2-for-1 Stock Split effective September 18, 2000 and
an amendment effective February 28, 2001)
1. PURPOSE
The purpose of this Plan is to further align the financial interests of
the Non-Employee Directors of Anheuser-Busch Companies, Inc. (the "Company")
with those of the Company's shareowners through the granting of options to
purchase the Company's common stock to such Non-Employee Directors, and to
help the Company attract and retain highly-qualified individuals to serve as
directors.
2. ELIGIBILITY
Participation in this Plan is limited to directors who are not
employees of the Company, including both active and advisory directors
("Non-Employee Directors").
3. GRANTS
(a) Annual Grants. On the effective date of this Plan and on the first
-------------
business day of May in each year thereafter, each Non-Employee Director
holding office on such date shall be granted 5,000 Options. The number of
shares and Options to be granted each year shall be subject to adjustment
pursuant to Section 7.
(b) Options. Each "Option" granted under this Plan shall give the
-------
recipient the right to purchase one share of the Company's common stock, par
value $1.00 per share ("Common Stock") at the price, and on the terms and
conditions, set forth in this Plan, including in particular Sections 4 and 5.
(c) Treasury Stock; Reservation. Only shares held in the Company's
---------------------------
treasury may be issued upon exercise of Options. The Company shall reserve
and set aside 300,000 treasury shares for that purpose, subject to adjustment
as provided in Section 7. The Secretary shall count shares against the
reserved number of treasury shares in any convenient, consistent manner
selected by her.
(d) Non-Stockholder Directors-SARs.
--------------------------------
(1) Notwithstanding Section 3(a), a person who is a
Non-Stockholder Director on a grant date specified in Section 3(a)
shall not receive Options, but instead shall receive 5,000 stock
appreciation rights ("SARs") (subject to adjustment).
(2) A "Non-Stockholder Director" is any Non-Employee Director who,
on the date a grant of Options otherwise would be made to him or her,
is not a stockholder and is permitted not to be a stockholder in
accordance with Section 3:2 of the Company's By-Laws.
(3) An "SAR" is an unsecured obligation of the Company to pay to
the recipient the amount, if greater than zero, by which the Fair Market
Value of a share of Common Stock (as defined in Section 4(b)) on the
exercise date exceeds the base price of the SAR.
(4) Each SAR grant shall be subject to the terms and conditions of
this Section 3(d) and Section 5.
<PAGE>
<PAGE> 2
(5) The base price of SARs shall be the same as the option price
of Options granted on the same date.
(6) SARs are subject to the same term, termination, vesting,
transferability, and adjustment provisions as are Options granted on
the same grant date, as provided in Sections 4(d), (e), (f), (g), (h),
(j), and (k).
(7) SARs may be exercised in the same manner as Options, except
that no payment of any option price shall be required. Payment of SARs
upon exercise shall be in cash unless the recipient and the Committee
mutually agree to make such payment in shares of Common Stock. If
payment is made in Common Stock, the shares so delivered shall be
issued only from the treasury shares reserved in Section 3(c).
(8) Dividends shall not accrue or be paid in respect of SARs,
nor shall SARs confer any voting rights. If, while remaining a
Non-Employee Director, any recipient of SARs ceases to be a Non-
Stockholder Director, then such person's SARs shall be converted into
Options unless the Committee determines in its discretion to cancel the
conversion. Any such converted Options shall have the same price and
other terms as if such person had been a Non-Employee Director who was
not a Non-Stockholder Director at the grant date of the SARs.
(e) Other Grants. In its discretion, the Committee or the Board may
------------
make a grant of Options (or SARs, if applicable) to any person who first
becomes a Non-Employee Director by Board appointment rather than by
shareholder election. Any such special grant may not exceed the annual
limits set forth in Section 3(a), but may be less than those limits in the
Committee's or Board's discretion.
(f) Records. Each year, the Company shall notify each recipient of the
-------
amount and type of each grant. For each Non-Employee Director, the Secretary
shall keep records showing the number of outstanding Options (or SARs)
granted to such Director along with their grant dates, option (or base)
prices, vesting status, and other data deemed significant by the Secretary.
4. TERMS OF OPTIONS
(a) General. Options shall be governed by this Plan, including in
-------
particular the terms and conditions of this Section 4 and Section 5. The
acceptance of any Options by a Non-Employee Director constitutes his or her
acceptance of the terms and conditions governing the Options.
(b) Price. The option price per share of Common Stock shall be equal
-----
to "Fair Market Value" on the grant date, which is the average of the high
and low sales prices quoted for the Company's Common Stock on the New York
Stock Exchange Composite Tape or similar quotation service for that date.
(c) Type. No Options shall be "incentive stock options" as defined in
----
Section 422 of the Internal Revenue Code of 1986, as amended.
(d) Normal Term. Options shall expire if not exercised before the
-----------
tenth anniversary of their grant date. Other provisions of this Plan may
terminate or otherwise shorten the normal term; no provision of this Plan is
intended to extend the normal ten-year term.
(e) Normal Vesting. Each grant of Options shall become exercisable in
--------------
three equal installments on the first three anniversaries of their grant
date, unless accelerated in accordance with
2
<PAGE>
<PAGE> 3
this Plan. Any fractions of an Option shall be allocated to earlier
installments from later installments so that on any anniversary date only
whole numbers of Options shall vest.
(f) Discretionary Acceleration of Vesting. Options may be made
-------------------------------------
exercisable in whole or part, for any individual or group of optionees, at
any time after grant in the discretion of the Committee or the Board.
(g) Acceleration Date. Options shall become exercisable automatically
-----------------
if and when an "Acceleration Date" occurs as defined in the Company's 1998
Incentive Stock Plan from time to time, or if and when an analogous change in
control event occurs as defined in any successor to such Plan. Changes to
the definition of "Acceleration Date" shall apply automatically and
retroactively to all Options outstanding under this Plan until such time as
an Acceleration Date occurs.
(h) Effects of Other Events on Term and Vesting. The following events
-------------------------------------------
will affect the term and vesting of Options in the manner indicated:
<TABLE>
<CAPTION>
============================================================================================================
EVENT EFFECT ON TERM EFFECT ON VESTING
- ------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Death Options may be exercised for 3 years Options vest immediately upon
following death, and not afterward*. death.
- ------------------------------------------------------------------------------------------------------------
Disability Options may be exercised for 1 year Options vest immediately upon
following termination of Non- Disability.
Employee Director status due to
Disability, and not afterward*.
- ------------------------------------------------------------------------------------------------------------
Retirement Options may be exercised for 5 years Options vest immediately upon
following Retirement, and not Retirement.
afterward*.
- ------------------------------------------------------------------------------------------------------------
Removal for Cause Unexercised Options terminate and Not applicable (forfeiture applies
are forfeited immediately upon to vested and unvested Options)
removal for cause; however, this
provision terminates and is of no
further effect after an Acceleration
Date occurs as provided in Section
4(g).
- ------------------------------------------------------------------------------------------------------------
Any other Unvested, non-accelerated Options Unvested Options become
termination of Non- terminate and are forfeited exercisable if they have been
Employee Director immediately; however, this provision outstanding at least six months
status** terminates and is of no further effect and if termination of Non-
after an Acceleration Date occurs as Employee Director status
provided in Section 4(g). coincides with the normal end of
Vested or accelerated Options may his or her current term of office
be exercised for 3 months following (i.e., the Director does not stand
termination of Non-Employee for re-election).
Director status, and not afterwards*.
============================================================================================================
<FN>
* None of the post-event exercise periods shall extend the term beyond
the normal ten years.
** If an optionee becomes an employee of the Company, then, for purposes
of this Section 4(h) only, that optionee's "Non-Employee Director"
status shall be deemed to continue as long as the optionee remains an
active or advisory
3
<PAGE>
<PAGE> 4
director of the Company. In that case, however, the optionee shall no
longer be eligible for future grants under Section 3.
</FN>
</TABLE>
For purposes of this Plan:
"Disability" means the condition of being disabled within the meaning
of Section 422(c)(6) of the Internal Revenue Code of 1986, as amended.
"Retirement" occurs if (A) a Non-Employee Director completes his or her
term of office, does not stand for re-election by the shareholders as an
active Director, and is of an age which meets or exceeds the Board's
then-current retirement age for active non-employee Directors, and (B) either
he or she (i) is not appointed by the Board as an advisory Director or (ii)
later ceases to be an advisory Director (regardless of the reason therefor).
In the case of clause (ii), "Retirement" occurs when advisory Director status
terminates, not when active status terminated.
"Removal for cause" means removal of a Non-Employee Director from
office "for cause" within the meaning of Section 141(k) of the Delaware
General Corporation Law or other applicable Delaware law.
(i) Exercise and Payment of Option Price. Options may be exercised in
------------------------------------
whole or part (to the extent exercisable) by delivering to the Company a
written exercise notice and payment of the option price. The option price
may be paid in cash or shares of Common Stock previously owned. If Stock is
used to pay the option price, such Stock shall be valued at its Fair Market
Value on the exercise date, and the Secretary may require the delivery of
stock certificates, stock powers, written instructions, and such other
documentation as she deems appropriate to satisfy legal requirements and
administrative needs.
(j) Transferability. Options shall not be transferable except by will
---------------
or the laws of descent and distribution. In the case of death, Options may
be exercised by the optionee's "Post-Death Representatives," who are the
executor or administrator of the optionee's estate or the person or persons
to whom the optionee's rights to his or her Options under this Plan shall
pass by his or her will or the laws of descent and distribution.
(k) Capital Change. The option price and number of Options shall be
--------------
adjusted as provided in Section 7 in the event of a stock split, stock
dividend, or other capital change.
(l) Non-Stockholder Status. If a participant becomes a Non-Stockholder
----------------------
Director after receiving one or more grants of Options, such Options shall be
converted into SARs as if such participant had been a Non-Stockholder
Director on the grant date.
(m) No Rights as a Shareholder until Exercise. No optionee nor his or
-----------------------------------------
her executors or administrators, legatees, or distributees, as the case may
be, shall have any of the rights of a shareholder with respect to shares of
stock covered by his or her Options until shares of stock are issued to him,
her, or them upon exercise of the Options.
4
<PAGE>
<PAGE>5
5. TAXES
If the Company is required to withhold or otherwise collect and remit
taxes at the time of the exercise of Options, then the optionee shall pay
such taxes to the Company in cash promptly after exercise. The Company may
withhold delivery of option shares pending receipt of such tax amounts. In
the case of SARs, the Company may elect to withhold any such required taxes
directly from the amount otherwise owed to the recipient of the SARs.
6. REGULATORY COMPLIANCE AND LISTING
The Company intends to register the issuance of the Common Stock upon
exercise of Options under federal securities laws, and to qualify such Stock
for exemption under applicable state securities laws. The issuance or
delivery of any such shares under this Plan may be postponed by the Company
for such period as may be required to comply with any applicable requirements
under the Federal securities laws (including Rule 144), any applicable
listing requirements of the New York Stock Exchange, Inc. or any other
applicable securities exchange, or any requirements under any other law or
regulation applicable to the issuance or delivery of such shares. Any stock
certificates delivered to a recipient prior to the satisfaction of any such
requirements shall bear an appropriate legend ensuring compliance with same.
In no event will the Company be obligated to issue or deliver any shares if
the issuance or delivery thereof would constitute a violation of any
provision of any law or of any regulation of any governmental authority or
any national securities exchange.
7. CHANGE IN CAPITALIZATION
(a) In the event of a recapitalization or other substantial change in
capitalization affecting the Company's Common Stock (other than a stock split
or stock dividend described in Section 7(b)), an appropriate and
proportionate adjustment shall be made by the Committee or Board:
(1) to the number of treasury shares reserved for issuance under
Section 3(c),
(2) to the number and/or to the option prices or base prices of
outstanding Options and SARs, and
(3) to the number of Options and SARs which may be granted
annually under Sections 3(a) and 3(d)(1) (respectively) of this Plan.
In the event of a spin-off, split-up, or other similar event, either the
Committee or the Board may make such adjustment to Sections 3(a), 3(c) and
3(d)(1), and to the number and/or to the option prices or base prices of
outstanding Options and SARs, as the Committee or Board deems appropriate and
convenient, if material.
(b) In the event that the Company's Common Stock is split or a dividend
in respect of such Common Stock is paid in the form of additional shares of
Common Stock, a numerically proportionate adjustment shall be made
automatically:
(1) to the number of treasury shares reserved for issuance under
Section 3(c),
(2) to the number and to the option prices or base prices of
outstanding Options and SARs, and
(3) to the number of Options and SARs granted annually under
Sections 3(a) and 3(d)(1) of this Plan.
5
<PAGE>
<PAGE> 6
(c) The Secretary of the Company shall cause this Plan to be
appropriately revised to reflect any such automatic adjustments, and shall
notify affected participants of any adjustments to their outstanding awards
under this Plan.
(d) The primary objective of all adjustments to outstanding Options and
SARs shall be to avoid a material enlargement or dilution of the benefits
represented by such awards.
8. ADMINISTRATION
This Plan shall be administered by a committee (the "Committee")
appointed by the Company's Board of Directors (the "Board") from time to
time. Until changed by the Board, the initial Committee shall be the
Executive Salaries Committee of the Board or its successor committee from
time to time. This Plan and all actions taken under it shall be governed by
the laws of the State of Delaware.
9. AMENDMENT
The Board has the authority to amend or terminate this Plan at any
time. Without the consent of the affected participant, no such amendment or
termination shall affect previously granted Options or SARs except to
shorten, lessen, or remove restrictions or to comply with applicable laws and
regulations (including in particular Rule 16b-3 under the Securities Exchange
Act of 1934, as amended). No Non-Employee Director shall have any right in
or to Options or SARs (as applicable) prior to grant, nor any right to
maintain this Plan's existence.
6
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.8
<SEQUENCE>4
<FILENAME>ex10p8.txt
<DESCRIPTION>EXHIBIT 10.8
<TEXT>
<PAGE> 1
ANHEUSER-BUSCH COMPANIES, INC.
SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
Amended and Restated as of March 1, 2001
<PAGE>
<PAGE> 2
TABLE OF CONTENTS
1. Definitions 1
2. Participation 3
3. Benefit on or After Normal Retirement Date 4
4. Benefit on Early Retirement 5
5. Pre-Retirement Death Benefit 5
6. Disability Benefit 6
7. Forfeiture for Activity Contrary to the Company's Best Interests 6
8. Payment Methods 7
9. Obligation to Pay Benefits Hereunder 8
10. Special Rule for Non-Deductible Amounts 8
11. Change in Control 8
12. Concerning Payment; Beneficiaries 9
13. Payees Presumed Competent 10
14. Facility of Payment 10
15. Notice of Address; Lost Payees 11
16. Participating Employer 11
17. No Liability for Payee's Debts 11
18. Administration 12
19. Negation of Employment Contract 12
20. Modification, Amendment, or Termination 12
21. Set Off and Withholding 13
22. Claims Procedure 13
23. Miscellaneous 14
<PAGE>
<PAGE> 3
ANHEUSER-BUSCH COMPANIES, INC.
SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
Amended and Restated as of March 1, 2001
ANHEUSER-BUSCH COMPANIES, INC., a Delaware corporation, established this
Supplemental Executive Retirement Plan, originally effective as of January 1,
1984. The Plan has been amended from time to time and the Company hereby
amends and restates the Plan. The provisions of this restated Plan shall
apply to eligible employees whose termination of employment with the Company
or any other Participating Employer occurs on or after March 1, 2001. The
Plan is intended to be a nonqualified, unfunded plan to provide supplemental
retirement benefits to a select group of management and highly compensated
employees, as described in Section 201(2) of the Employee Retirement Income
Security Act of 1974 ("ERISA").
1. Definitions. The capitalized terms used in this Plan shall have the
-----------
meanings herein set out:
(a) "Accrued Benefit" means at any given time the benefit
calculated in accordance with the formula in Section 3, using the
Participant's Eligible Earnings and Credited Service as of the date the
calculation is being made. The benefit so calculated shall be the benefit
that would commence under the basic method of payment on the Participant's
Normal Retirement Date.
(b) "Actuarial Equivalent" means a benefit or benefits, or a
payment or payments, which are of equal value at the date of determination to
the benefits for which they are to be substituted. Equivalence of value is
determined from actuarial calculations based on actuarial assumptions as to
interest and mortality applied with respect to the particular form or forms
of payment under the Basic Plan, disregarding the interest and mortality
assumptions grandfathered as of December 31, 1999 with respect to single sum
and installment payments.
(c) "Basic Plan" means the Supplement for the Anheuser-Busch
Salaried Employees Pension Plan maintained as part of the Anheuser-Busch
Companies Pension Plan as now in effect or as hereafter amended.
(d) "Board" means the board of directors of the Company.
(e) "Committee" means the Committee designated to administer this
Plan, as described in Section 18.
(f) "Company" means Anheuser-Busch Companies, Inc., a Delaware
corporation, and any corporation(s) into which or with which it may be
liquidated, merged or consolidated.
(g) "Credited Service" Except as provided herein, a Participant's
Credited Service under this Plan shall be the same as the Participant's
Credited Service under the Basic Plan for all purposes. This generally means
an individual's
<PAGE>
<PAGE> 4
years and completed months of salaried employment with a Participating
Employer after attainment of age 21. Credited Service shall not exceed 30
years. Additional Credited Service granted under the Change in Control
provisions of the Anheuser-Busch Companies Pension Plan (Section 19.14)
shall not be Credited Service under this Plan.
(h) "Eligible Earnings" means, for any calendar year, the sum of
the employee's annual base salary as of January 1 of such year plus the
bonus earned during the prior calendar year. For purposes of computing
benefits under this Plan, the Eligible Earnings to be used shall be the
highest of the Eligible Earnings in the calendar year of termination or any
of the four preceding calendar years. Eligible Earnings shall recognize any
compensation deferred under the Executive Deferred Compensation Plan and
treat such compensation as if it were not deferred.
(i) "Eligible Employee" means a salaried employee of a
Participating Employer who is an active participant currently accruing
benefits in the Basic Plan and who satisfies or in the past has satisfied one
or more of the following requirements:
i) He or she is a member of the Company's Strategy
Committee;
ii) He or she has a salary band of I or above, or the
equivalent thereof as determined by the Committee, and has, for the current
calendar year, Eligible Earnings of at least $140,000 (indexed as described
below) or such other amount as the Committee shall determine from time to
time; or
iii) He or she is an officer of the Company or Anheuser-
Busch, Inc., a Missouri corporation, excluding an assistant officer.
The $140,000 figure shall be indexed as of January 1 of each year commencing
January 1, 1994, in accordance with the Company's overall combined merit
budget increase applicable for such year. (For 2001, the Eligible Earnings
requirement is $178,853.)
(j) "Excess Benefit Plan" means the Anheuser-Busch Companies, Inc.
Excess Benefit Plan, Amended and Restated as of March 1, 2000, and as
thereafter amended, or any other "excess plan" as described in Section 3(36)
of ERISA, maintained by a Participating Employer and as in effect from time
to time.
(k) "Normal Retirement Date" means the first day of the month
coincident with or next following the date on which the Participant attains
his or her sixty-fifth (65th) birthday.
(l) "Participant" means an Eligible Employee who is participating
in this Plan in accordance with Section 2.
(m) "Participating Employer" means the Company and any other
member of the controlled group of corporations of which the Company is a
member
-2-
<PAGE>
<PAGE> 5
which is a Participating Employer in the Basic Plan and which has adopted
this Plan in the manner described in Section 16.
(n) "Plan" means this Anheuser-Busch Companies, Inc. Supplemental
Executive Retirement Plan, Amended and Restated as of March 1, 2001, and as
thereafter amended.
(o) "Primary Social Security Benefit" means, for retirements on or
after the Normal Retirement Date, the estimated primary insurance amount that
would commence immediately under the Federal Social Security Act in effect on
the retirement date assuming that the Participant's earnings for Social
Security purposes are equal to the benefit base as determined under Section
230 of the Federal Social Security Act from the date the Participant attained
age 21 until the Participant's retirement date.
For purposes of determining the Accrued Benefit prior to a Participant's
Normal Retirement Date, the Primary Social Security Benefit means:
(i) An amount determined as described above assuming that
the Participant retires on his or her Normal Retirement Date and that the
Social Security Act and benefit base remain unchanged in the future,
multiplied by
(ii) The ratio of the Participant's Credited Service as of
the date of determination to the lesser of thirty (30) years or the
Participant's Credited Service had the Participant remained an active
Participant until his or her Normal Retirement Date.
(p) "Subsidiary" means any business entity in which the Company
has an equity interest of at least fifty percent.
Miscellaneous Rules of Construction. Masculine pronouns include the
- -----------------------------------
feminine, the singular includes the plural, and the plural includes the
singular, as the context or application demands.
2. Participation. Each Eligible Employee shall commence participation
-------------
in this Plan as of the first day of the month coincident with or next
following the date he or she first becomes an Eligible Employee. An
individual who is an Eligible Employee solely under subparagraph (ii) of
Section 1(i) shall be deemed to have first satisfied the band and
compensation requirements of such provision on January 1 of the first
calendar year for which such requirements are satisfied. Except as provided
in Section 16, once an individual becomes a Participant, he or she shall
continue to participate until termination of employment with a Participating
Employer even if such individual no longer satisfies the band and
compensation requirements to remain an Eligible Employee. Any Eligible
Employee on October 1, 1993 who was not a Participant in this Plan prior to
its restatement effective October 1, 1993 shall first participate as of
October 1, 1993.
-3-
<PAGE>
<PAGE> 6
3. Benefit on or after Normal Retirement Date.
------------------------------------------
(a) A Participant who ceases to be employed by all members of the
Company's controlled group of corporations on or after his or her Normal
Retirement Date shall receive a monthly benefit, payable under the basic
method of payment described in Section 8, and commencing on the first day of
the month coinciding with or immediately following his or her last date of
employment, in an amount which is one-twelfth of the following:
(i) For Strategy Committee members, one and two-thirds
percent of Eligible Earnings times Credited Service; for all other
Participants, one and one-half percent of Eligible Earnings times Credited
Service (provided that once a Participant becomes a Strategy Committee
member, the Participant's benefit will be based on the higher formula for all
Credited Service even if the Participant ceases to be a Strategy Committee
member prior to retirement); less
----
(ii) The Participant's annual retirement benefit payable at
Normal Retirement Date (or, if applicable, postponed retirement date) under
the Basic Plan, under the basic method of payment described in such plan;
less also
- ---------
(iii) Any other benefits from any excess benefit plan or other
retirement plan or arrangement maintained or sponsored by the Company or any
Subsidiary, other than a qualified or nonqualified 401(k) plan or a voluntary
nonqualified deferred compensation plan. The reduction under this paragraph
shall be the annual benefit under such other plan or plans, payable at Normal
Retirement Date (or, if applicable, postponed retirement date), expressed as
if payable under the basic method of payment described in such plan;
provided, however, that if such basic method is not a form of single life
annuity, then expressed as if payable solely for the lifetime of the
Participant on an Actuarial Equivalent basis; less also
---------
(iv) The Participant's annual Primary Social Security
Benefit.
(b) In no event shall a Participant's benefits calculated under
3(a) be less than the difference between (i) the benefit actually payable
under the Basic Plan, and (ii) the benefit that would have been payable under
the Basic Plan without regard to the limitation imposed by Section 401(a)(17)
of the Internal Revenue Code (both amounts to be determined under the basic
method of payment). This minimum benefit shall be separately calculated with
respect to all Participants, including those whose benefits exceed this
minimum, and shall be treated as a separate obligation payable from a
separate plan solely for the purpose of determining which, if any, portion of
a Participant's benefits is subject to income tax in the state where the
Participant resided when the benefit was earned.
(c) A Participant's gross benefit calculated under 3(a)(i) hereof
shall never be lower than the amount that would have been calculated under
subparagraph (a)(i) if the Participant's retirement had occurred on any date
after the Participant's attainment of age 55 and five years of Credited
Service.
-4-
<PAGE>
<PAGE> 7
(d) If a Participant retires after his or her Normal Retirement
Date, the Participant's gross benefit calculated under 3(a)(i) shall not be
less than the Actuarial Equivalent of the Participant's gross benefit under
3(a)(i) calculated as of the date the Participant attained Normal Retirement
Date.
4. Benefit on Early Retirement. The following benefits are available
---------------------------
for Participants who retire prior to Normal Retirement Date:
(a) A Participant who ceases to be employed by all members of the
Company's controlled group of corporations prior to his or her Normal
Retirement Date but after reaching age 62 and completing 30 years of Credited
Service shall be entitled to receive a retirement benefit equal to his or her
Accrued Benefit, but commencing on the first day of the month coinciding with
or immediately following the Participant's last date of employment.
(b) A Participant who ceases to be employed by all members of the
Company's controlled group of corporations after reaching age 55 and who has
at least five years of Credited Service but who is not eligible to receive a
benefit under paragraph (a) above may, unless disapproved by the Company's
Chief Executive Officer (or, in the case of the Chief Executive Officer, the
Board of Directors), be granted a benefit equal to his or her Accrued Benefit
reduced in accordance with the reduction applicable to the Participant's
retirement benefits payable under the Basic Plan. Such benefit shall
commence as of the first day of the month coincident with or next following
the Participant's last date of employment.
(c) There shall be no benefits payable from this Plan for a
Participant who ceases employment prior to the attainment of age 55, except
as provided in Sections 5, 6 and 11.
5. Pre-Retirement Death Benefit.
----------------------------
(a) If a Participant dies while employed by a Participating
Employer, and after otherwise satisfying the requirements of Sections 3, 4 or
6 to receive a retirement benefit, a death benefit may be paid. The death
benefit, when combined with certain life insurance proceeds as described
below, is intended to place the Participant in approximately the same
position (after payment of income taxes) as he or she would have been in had
the Participant retired on the date of the Participant's death.
The amount of the death benefit, if any, payable from this Plan
shall be computed as follows:
(i) the After-Tax single lump sum Actuarial Equivalent of
his or her Accrued Benefit under this Plan plus the After-Tax single lump sum
value of any benefits that would have been payable under any Excess Benefit
Plan if the Participant had retired (rather than died) on his or her date of
death, minus
-----
-5-
<PAGE>
<PAGE> 8
(ii) the single lump sum proceeds of any life insurance
policy insuring the life of the Participant, whether group, individual, term,
universal or any other type, available through the Company or any Subsidiary,
regardless of whether the premiums therefor are paid by the Participant or
the Company. For purposes hereof, each Participant shall be deemed to have
elected to participate in all such life insurance programs available through
the Company or any Subsidiary, whether or not such Participant actually so
participated on the date of his or her death. Any insurance policy proceeds
directly attributable to supplemental contributions made by the Participant
with respect to any such policy shall not be taken into account for this
purpose.
(iii) The amount so obtained shall then be grossed up for
income tax purposes by dividing such amount by one minus the tax rate
determined under paragraph (b).
(b) For purposes of this Section 5, the term "After-Tax" shall
mean the amount remaining after subtraction of approximate federal, state and
local income and employment taxes expected to be paid on the amount in
question. The Company's Tax Controller, or other officer with similar
responsibilities, shall determine "After-Tax" amounts, in his or her
discretion, using such presumed tax rates as the Tax Controller shall deem
reasonable and appropriate under the circumstances of the individual
involved.
(c) Any amount payable under this Section 5 shall be paid in a
single lump sum to the Beneficiary determined in accordance with Section 12.
6. Disability Benefit. A Participant whose employment terminates
------------------
because of disability prior to becoming eligible for benefits under Section 3
or 4 shall be entitled to the Actuarial Equivalent of his or her Accrued
Benefit. Disability shall be established, as determined by the Committee, if
the Participant is unable for a period reasonably expected to exceed six
months to perform the duties of the position held prior to the incident or
the onset of the illness resulting in the disability.
7. Forfeiture for Activity Contrary to the Company's Best Interests.
----------------------------------------------------------------
(a) Notwithstanding any provision of this Plan to the contrary,
the right of a Participant and his or her beneficiary or beneficiaries to
receive a benefit hereunder is expressly conditioned upon the Participant
neither (i) having ceased to be employed by the Company or any Subsidiary
under circumstances or conditions inimical or contrary to the best interests
of the Company or any Subsidiary, nor (ii) thereafter engaging in any activity
which in the Committee's judgment is inimical or contrary to the best
interests of the Company or any Subsidiary.
(b) Should a Participating Employer propose to enforce the
foregoing, it shall give written notice to the Participant or other person(s)
otherwise entitled to payment, and may withhold payment pending final
resolution of the matter. The Committee shall thereupon investigate the
alleged violation and shall consider, under such rules of procedure as the
Committee shall deem reasonable, such evidence and
-6-
<PAGE>
<PAGE> 9
testimony as the Participating Employer and the Participant or other person
or persons receiving or otherwise entitled to receive payment may wish to
submit in support or refutation of the alleged violation. The decision of
the Committee shall be final and conclusive. If the Committee concludes that
there has been a violation, the right of the Participant and all
beneficiaries to receive payment hereunder shall thereupon cease. If the
Committee concludes that there has not been a violation, the amounts withheld
or suspended shall become payable as though no proceedings had been
instituted nor any payment withheld or suspended, without, however, any
interest for the period during which such amounts were withheld or suspended.
(c) The provisions of this Section authorizing the Participating
Employer to give notice of an alleged violation or possible violation of the
conditions of paragraph (a) shall not be interpreted as requiring the
Participating Employer to take such action in each and every instance of a
violation or suspected violation, and in determining whether an attempt to
enforce the forfeiture provisions of this Section shall be made, the
Participating Employer may consider the possible economic damage it might
suffer from the violation or suspected violation, the circumstances
surrounding the discontinuance of the employment of the Participant with the
Participating Employer and the quantum of proof which the Participating
Employer may have of a violation of the aforesaid conditions.
(d) The provisions of this Section shall in no way impair or
derogate the rights which a Participating Employer may otherwise have under
any employment contract with a Participant or at law or in equity, to prevent
the disclosure of confidential information or to recover damages for the
disclosure thereof or to prevent a Participant from engaging in competition
with a Participating Employer or to recover damages therefor.
(e) The Board (or the Executive Committee at any time the Board of
Directors is not in session) may revoke this Section at any time, whereupon
no Accrued Benefit at that time shall ever be subject to forfeiture or
revocation for any reason, including (but not limited to) any subsequent
amendment to this Plan which reinstates the provisions of this Section or
imposes similar conditions on a Participant's right to receive benefits
hereunder.
(f) If the provisions of this Section are invoked at any time
after payments have already been made, the Participating Employer shall have
the right to a refund of all monies theretofore paid. If the Participating
Employer shall find it necessary to file suit to recover any amount
hereunder, it shall be entitled to recover its reasonable attorney's fees and
costs.
8. Payment Methods. The basic method of payment for Participants
---------------
retiring on or after January 1, 1995 shall be monthly payments for life,
beginning on the first day of the month coincident or next following the
Participant's retirement date, with the last payment being for the month in
which the Participant's death occurs, but with 120 monthly payments
guaranteed. Notwithstanding the foregoing, payment shall be made in a single
lump sum unless the Participant gives written notice to the Committee, at
least one year prior to the date of employment termination, that the
-7-
<PAGE>
<PAGE> 10
Participant elects to receive benefits under either the basic method of
payment described above or one of the following optional methods which shall
be the Actuarial Equivalent of the basic method of payment:
(a) A two-thirds joint and survivor annuity with such contingent
annuitant as the Participant may designate. If a Participant has selected
this method of payment and the contingent annuitant dies before payments
begin, the selection shall be revoked, but if the contingent annuitant dies
after payments begin, the selection of this method of payment shall not be
affected and no new contingent annuitant may be named; or
(b) Level installments payable annually over a five-year period.
(c) Level installments payable annually over a ten-year period.
A Participant may elect an optional method of payment under this Plan which
is different from the method of payment elected under either the Basic Plan
or the Excess Benefit Plan.
9. Obligation to Pay Benefits Hereunder. No trust fund, escrow account
------------------------------------
or other segregation of assets shall be established or made by any
Participating Employer to guarantee, secure or assure the payment of any
benefit hereunder. The obligation of each Participating Employer to pay
benefits pursuant to this Plan shall constitute only a general obligation of
the Participating Employer to the Participants and other payees hereunder in
accordance with the terms hereof. Payment of benefits by a Participating
Employer hereunder shall be made only from the general funds of the
Participating Employer and no Participant or other potential payee of any
amount hereunder shall have any interest in any particular asset of any
Participating Employer by reason of the existence of this Plan, and the
amounts payable hereunder shall be subject in all respects to claims of
general creditors of the respective Participating Employers until actually
paid over to the person(s) entitled to receive the same.
10. Special Rule for Non-Deductible Amounts. Any amount otherwise
---------------------------------------
payable under the Plan in a calendar year for which the Company determines
that the amount would not be deductible by any Participating Employer under
section 162(m) of the Internal Revenue Code, shall not be paid until such
calendar year as the Company determines that the amount has ceased to be so
non-deductible. In the case of any inconsistency between this Section 10 and
any other provision of the Plan, this Section 10 shall govern, except in the
case of Section 11 becoming applicable.
11. Change in Control.
-----------------
(a) If a Change in Control (as defined in Section 11(b)) shall
occur, then, notwithstanding anything to the contrary herein, a Participant's
Accrued Benefit under the Plan as of the Change in Control Date shall be
fully vested and non-forfeitable. Within 30 days after the Change in Control
Date, the Participant shall be paid, in a single lump-sum payment, the
Actuarial Equivalent of such Accrued
-8-
<PAGE>
<PAGE> 11
Benefit as of the date of payment. Notwithstanding the foregoing, if, on the
Change in Control date, a Participant otherwise satisfied the eligibility
requirements for early or normal retirement benefits under Sections 3 or 4,
such Participant's benefit shall be paid as if he or she actually retired on
the Change in Control Date. The Chief Executive Officer shall be deemed to
have granted any necessary approvals.
(b) For purposes of this Plan, a "Change in Control" shall occur
automatically if and when an "Acceleration Date" occurs as defined in the
Company's 1998 Incentive Stock Plan or if and when an analogous change in
control event occurs as defined in any successor to such plan, and the Change
in Control Date shall be the Acceleration Date or analogous date as defined
therein.
(c) This Section 11 may be deleted or amended in any way pursuant
to Section 20 at any time prior to a Change in Control. Notwithstanding
Section 20, following a Change in Control, the provisions of this Section 11
cannot, after the Change in Control Date, be amended in any manner without
the written consent of each individual who was a Participant immediately
prior to the Change in Control.
(d) Following a Change in Control, this Plan shall continue in
effect, notwithstanding that payment of benefits shall have been made under
Section 11(a), unless and until terminated by the Company.
(e) If a Change in Control occurs, Section 7 shall no longer apply
to any individual whose activities are not under investigation by the
Committee on the Change in Control Date.
(f) If by reason of this Section an excise or other special tax
("Excise Tax") is imposed on any payment under this Plan (a "Required
Payment"), the amount of each Required Payment shall be increased by an
amount which, after payment of income taxes, payroll taxes and Excise Tax
thereon, will equal such Excise Tax on the Required Payment.
12. Concerning Payment; Beneficiaries.
---------------------------------
(a) Except as otherwise provided in this Section, any amount
payable under this Plan as a result of or following the death of a
Participant shall be applied only for the benefit of the beneficiary or
beneficiaries designated by the Participant pursuant to this Section. Each
Participant shall specifically designate, by name, on forms provided by the
Committee, the beneficiary(ies) to whom any such amounts shall be paid. A
Participant may change or revoke a beneficiary designation without the
consent of the beneficiary(ies) at any time by filing a new beneficiary
designation form with the Committee. The filing of a new form shall
automatically revoke any forms previously filed with the Committee. A
beneficiary designation form not properly filed with the Committee prior to
the death of the Participant shall have no validity under the Plan.
(b) Except as provided in Section 8, any such designation shall be
contingent on the designated beneficiary surviving the Participant. If a
designated
-9-
<PAGE>
<PAGE> 12
beneficiary survives the Participant but dies before receiving the entire
amount payable to the designated beneficiary hereunder, the amount which
would otherwise have been so paid shall be paid to the estate of the deceased
beneficiary unless a contrary direction was made by the Participant, in which
case such direction shall control. More than one beneficiary, and
alternative or contingent beneficiaries, may be designated, in which case the
Participant shall specify the shares, terms and conditions upon which amounts
shall be paid to such multiple or alternative or contingent beneficiaries,
all of which must be satisfactory to the Committee.
(c) If no beneficiary designation is on file with the Committee at
the time of the Participant's death or no beneficiary designated by the
Participant survives the Participant, the Participant's estate shall be
deemed to be the beneficiary designated to receive any amounts then remaining
payable under this Plan.
(d) In determining any question concerning a Participant's
beneficiary, the latest designation filed with the Committee shall control
and intervening changes in circumstances shall be ignored; provided, if a
Participant's spouse is designated as beneficiary but thereafter is divorced
from the Participant, such designation shall become invalid as of the date of
divorce unless the Participant files a beneficiary designation form with the
Committee after the date of divorce confirming designation of such former
spouse as beneficiary.
(e) Any check issued on or before the date of a Participant's
death shall remain payable to the Participant, whether or not the check is
received by the Participant prior to death. Any check issued after the date
of the Participant's death shall be the property of the Participant's
beneficiaries determined in accordance with this Section 12.
13. Payees Presumed Competent. Every person receiving or claiming
-------------------------
amounts payable under this Plan shall be conclusively presumed to be mentally
competent and of legal age until the Committee receives a written notice, in
form, manner and substance acceptable to it, that any such person is
incompetent or is a minor or that a guardian or other person legally vested
with the care of the person's estate has been appointed.
14. Facility of Payment. If any amount is payable hereunder to a minor
-------------------
or other person under legal disability or otherwise incapable of managing his
or her own affairs, as determined by the Committee in its sole discretion,
payment thereof shall be made in one (or any combination) of the following
ways, as the Committee shall determine in its sole discretion:
(i) Directly to said minor or other person;
(ii) To a custodian for said minor or other person (whether
designated by the Company or any other person) under the Missouri Transfers
to Minors Law, the Missouri Personal Custodian Law or a similar law of any
other jurisdiction;
-10-
<PAGE>
<PAGE> 13
(iii) To the conservator of the estate of said minor or other
person; or
(iv) To some relative or friend of such minor or other person
for the support, welfare or education of such minor or other person.
The Committee shall not be required to see to the application of any payment
so made, and payment to the person determined by the Committee shall fully
discharge the Plan and the Participating Employer from any further
accountability or responsibility with respect to the amount so paid.
15. Notice of Address; Lost Payees. The address of every Participant or
------------------------------
other person entitled to any payment hereunder on file for purposes of the
Basic Plan shall be used for all purposes of this Plan. If the Committee is
unable to locate any person, or the estate of such person, after a reasonable
attempt to locate such person has been made, within two years after an amount
becomes payable hereunder, the right and interest of such payee in and to the
amount payable shall terminate on the last day of such two-year period.
16. Participating Employer. Any Participating Employer in the Basic
----------------------
Plan may become a Participating Employer in this Plan by submitting to the
Committee a resolution of its board of directors adopting the provisions of
this Plan. The adoption of this Plan by a Participating Employer shall
constitute an automatic delegation by it to the Board of full authority to
amend or terminate the Plan and to the Committee to administer this Plan.
Benefits payable under this Plan for a Participant whose employment
terminates from a Participating Employer shall be solely the obligation of
that Participating Employer. A Participating Employer may withdraw from the
Plan by action of its board of directors. If such a withdrawal shall occur,
no benefit shall be payable under this Plan to any Participant who has not
otherwise satisfied the eligibility requirements of Sections 3, 4, 6 or 11,
as of the date of withdrawal. Notwithstanding the foregoing, any benefits in
pay status as of the date of withdrawal shall continue to be paid in full in
accordance with the terms hereof.
17. No Liability for Payee's Debts. Amounts payable under this Plan
------------------------------
shall not be liable for or subject to the debts or liabilities of any payee,
and no amount payable hereunder shall at any time or in any manner be subject
to anticipation, alienation, sale, transfer, assignment, pledge or
encumbrance of any kind, whether to any Participating Employer or to any
other party whomsoever, and whether with or without consideration. If any
payee shall attempt to, or shall anticipate, alienate, sell, transfer,
assign, pledge or otherwise encumber any amounts payable hereunder or any
part thereof, or if by reason of bankruptcy or other event, such amounts
would at any time be received or enjoyed by persons other than such payee,
except as otherwise permitted by this Plan, the Committee in its sole
discretion may terminate such person's interest in any such amounts and hold
or apply such amounts to or for the use of such person, his or her spouse,
children or other dependents, or any of them, as the Committee may determine.
-11-
<PAGE>
<PAGE> 14
18. Administration. This Plan shall be administered by a Committee
--------------
composed of the Company's Chief Executive Officer, Chief Financial Officer
and Corporate Secretary. The Committee shall administer the Plan in
accordance with its terms and shall have all powers necessary to carry out
the provisions of the Plan. The Committee shall interpret the Plan; shall
determine all questions arising in the administration, interpretation, and
application of the Plan; and shall construe any ambiguity, supply any
omission, and reconcile any inconsistency in such manner and to such extent
as the Committee deems proper in its discretion. Any interpretation or
construction placed upon any term or provision of the Plan by the Committee,
any decisions and determinations of the Committee arising under the Plan,
including without limiting the generality of the foregoing: (i) the
eligibility of any individual to become or remain a Participant and a
Participant's status as such, and Eligible Earnings for any year; (ii) the
time, method and amounts of payments payable under the Plan; (iii) the rights
of Participants; and any other action or determination or decision whatsoever
taken or made by the Committee in good faith shall be final, conclusive, and
binding upon all persons concerned, including, but not limited to, the
Company, all Participating Employers and all Participants and beneficiaries.
19. Negation of Employment Contract. This Plan does not create an
-------------------------------
employment contract and nothing contained herein shall be deemed (a) to give
a Participant the right to be retained in the employ of any Participating
Employer; (b) to interfere with the right of any Participating Employer to
discharge a Participant at any time with or without cause; (c) to give any
Participating Employer the right to require a Participant to remain in its
employ; or (d) to interfere with the right of a Participant to terminate
employment voluntarily whenever the Participant chooses.
20. Modification, Amendment, or Termination. Except as provided in
---------------------------------------
Section 11, the Company has the absolute right to modify or amend this Plan
in whole or in part, at any time and from time to time, effective as of any
specified prior, current or future date. Such amendment shall be made in
accordance with applicable corporate procedures then in effect for similar
matters. The Company also reserves the right to terminate this Plan, in
whole or in part, voluntarily as of any specified current or future date.
This Plan shall be automatically terminated upon a termination of the Basic
Plan, a dissolution of the Company (but not upon a merger, consolidation,
reorganization or recapitalization of the Company unless the surviving
corporation therein specifically terminates this Plan); upon the Company
being legally adjudicated a bankrupt; upon the appointment of a receiver or
trustee in bankruptcy with respect to the Company's assets and business if
such appointment is not set aside within 90 days thereafter; or upon the
making by the Company of an assignment for the benefit of creditors. Upon
termination of this Plan, no additional employee shall become eligible to
participate herein, and no additional benefits shall be accrued hereunder.
Notwithstanding the termination of this Plan, no Participant affected thereby
shall be deprived of the right to receive his or her Accrued Benefit at the
time and in the manner provided by this Plan.
-12-
<PAGE>
<PAGE> 15
21. Set Off and Withholding.
-----------------------
(a) Notwithstanding Section 17, any amount then due and payable by
the Company or any Participating Employer to any Participant or the
beneficiary of any Participant under this Plan may be offset by any amounts
owed to the Company or any Subsidiary by the Participant and/or the
beneficiary for any reason and in any capacity whatsoever, as the Company may
determine in its sole and absolute discretion.
(b) There shall be deducted from any amount payable under this Plan
all taxes required to be withheld by any federal, state or local government.
Participants and their beneficiaries shall bear any and all federal, state,
local and other income taxes and other taxes imposed on amounts paid under
the Plan, whether or not withholding is required or carried out in accordance
with this provision.
22. Claims Procedures.
-----------------
(a) The Committee shall make all decisions and determinations
respecting the right of any person to a payment under the Plan.
(b) The following procedure shall be followed with respect to
claims under the Plan:
(i) Any claimant who believes he or she is entitled to a
benefit under this Plan shall submit a claim for such benefit in writing to
the Committee.
(ii) Any decision by the Committee denying a claim in whole
or in part shall be stated in writing by the Committee and delivered or
mailed to the claimant within ninety (90) days after receipt of the claim by
the Committee unless special circumstances require an extension of time for
processing, but in any event within one hundred eighty (180) days after such
receipt. If such an extension of time is taken, the Committee shall inform
the claimant of the delay in writing before the expiration of the initial
ninety (90) day period, including the reasons therefor and the date by which
the Committee expects to render a decision. Any decision denying a claim
shall set forth the specific reasons for the denial with specific references
to Plan provisions on which the denial is based, a description of any
additional material or information necessary to perfect the claim and the
reasons therefor, and an explanation of the Plan's claim review procedure,
all written in a manner calculated to be understood by the claimant. If the
Committee does not notify the claimant of denial of the claim or the need for
an extension of time within the initial ninety (90) day period, the claim
shall be deemed denied.
(iii) If a claim is denied in whole or in part, the claimant
or his duly authorized representative may request a review by the Committee
of the decision upon written application to the Committee within sixty (60)
days after notification of the decision. The claimant or his duly authorized
representative may review pertinent
-13-
<PAGE>
<PAGE> 16
documents and submit issues and comments in writing. The Committee shall
make its decision on review not later than sixty (60) days after receipt of
the request for review unless special circumstances require an extension of
time for processing, in which case its decision shall be rendered as soon as
possible, but not later than one hundred twenty (120) days after receipt of
the request for review. If such an extension of time is taken, the Committee
shall inform the claimant of the delay in writing before the expiration of
the initial sixty (60) day period. The decision on review shall be in
writing and shall include specific reasons for the decision, written in a
manner calculated to be understood by the claimant and specific references to
the pertinent plan provisions on which the decision is based. If the
Committee does not notify the claimant of its decision on review within the
period herein provided for, the claim shall be deemed denied on review.
(c) The Committee may adopt such rules as it deems necessary,
desirable, or appropriate to carry out its duties under this Section 22.
Any action or determination or decision whatsoever taken or made by the
Committee under this Section 22 shall be final, conclusive, and binding upon
all persons concerned, including, but not limited to, the Company, all
Participating Employers and all Participants and beneficiaries.
(d) The procedure provided for in this Section 22 shall be the
sole, exclusive and mandatory procedure for resolving any dispute under this
Plan; provided, that if a Participant wishes to make a valid legal challenge
to the Committee's determination and he has entered into an agreement with
the Company to arbitrate disputes arising from his or her employment with the
Company, such legal challenge shall be resolved pursuant to the arbitration
procedures in that agreement and the Participant's burden of proof in any
arbitration shall be the same as if the dispute were tried in a court
proceeding.
(e) Notwithstanding the foregoing, upon a Change in Control as
defined in Section 11, Section (d) above shall not apply.
(f) In any arbitration or litigation to enforce rights and
obligations hereunder, except as required by law or separate contract between
the parties, the unsuccessful party shall pay the successful party an amount
equal to all reasonable out-of-pocket expenses (including reasonable legal
expenses and court costs) incurred by the successful party.
23. Miscellaneous.
-------------
(a) In any instance in which the Committee believes such action to
be in the best interest of the party entitled to receive any payment under
this Plan, or to be in the best interests of any Participating Employer (such
as to eliminate small account balances or to avoid the administrative
inconvenience and expense which might be incurred if relatively small amounts
were to be paid to multiple recipients over lengthy periods of time), amounts
payable hereunder may be paid in a single lump-sum
-14-
<PAGE>
<PAGE> 17
payment, the amount of which shall be the Actuarial Equivalent of the payment
in question.
(b) In the event of the death of a Participant or any beneficiary,
the Committee need not make any payment provided for by this Plan until it
shall have received proof satisfactory to it of such death and of the
identity, existence and location of the party thereafter entitled to receive
payments under this Plan.
(c) In making any payment or taking any action under this Plan,
the Participating Employers and the Committee shall be absolutely protected in
relying upon any finding or statement of facts believed to be true, and on
any written instrument believed to have been signed by the proper party.
(d) Subject to the applicable provisions of the Employee
Retirement Income Security Act of 1974 which provide to the contrary, this
Plan shall be administered, construed, and enforced according to the laws of
the State of Missouri (other than choice of law), and in courts situated in
that state.
IN WITNESS WHEREOF, ANHEUSER-BUSCH COMPANIES, INC. has caused this
Amended and Restated Plan to be executed by its officers thereunto duly
authorized, this 15th day of March, 2001, effective as of March 1, 2001.
ANHEUSER-BUSCH COMPANIES, INC.
By /s/ W. Randolph Baker
-----------------------------
W. Randolph Baker
Chief Financial Officer
-15-
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.9
<SEQUENCE>5
<FILENAME>eoex10p9.txt
<DESCRIPTION>EXHIBIT 10.9
<TEXT>
<PAGE> 1
ANHEUSER-BUSCH
EXECUTIVE DEFERRED COMPENSATION PLAN
(AMENDED AND RESTATED AS OF JANUARY 1, 2001)
Preamble
--------
Anheuser-Busch Companies, Inc. (the "Company") adopted the Anheuser-Busch
Executive Deferred Compensation Plan (the "Plan") for the purpose of
providing deferred compensation to a select group of management and highly
compensated employees, effective as of January 1, 1994. The Company reserved
to itself the right to amend the Plan. The Plan has been amended from time
to time. The Company deems it necessary and desirable to amend and restate
the Plan in its entirety as hereinafter set forth, effective January 1, 2001.
I. DEFINITIONS
Account: The separate record of the interest of each Participant in
-------
this Plan which the Company maintains in accordance with Section IV. A
Participant's Account shall include such subaccounts as may be required to
account separately for amounts subject to the Participant's various elections
respecting deferral and hypothetical investment under the Plan, and the term
"Account" shall include subaccount where the context so requires.
Base Salary: The substantially equal amounts owed by a Participating
-----------
Employer to an Employee on a regular periodic basis in exchange for services
rendered during a Year, regardless of when paid.
Bonus: Any amount awarded by a Participating Employer to an Employee
-----
for a Year under a bonus plan, regardless of when awarded or paid.
Company: Anheuser-Busch Companies, Inc.
-------
Deferral Amounts: The amounts a Participant defers under this Plan
----------------
from time to time.
Effective Date: The original Effective Date was January 1, 1994. The
--------------
Effective Date of this amendment and restatement of the Plan is January 1,
2001.
Eligible Compensation: As to any Year, a Participant's Base Salary
---------------------
and Bonus for such Year. No payments under the Company's Supplemental
Life Insurance Program or any like program, taxable or non-taxable fringe
benefits, stock-related compensation, international service premiums or
other cash or in-kind compensation shall be taken into account as Eligible
Compensation.
1
<PAGE> 2
Eligible Employee: With respect to any Year, an Employee who satisfies
-----------------
the requirements for participation in the Plan for the Year, as determined
pursuant to Section II.
Employee: A salaried common-law employee of a Participating Employer
--------
as determined from time to time. In no event shall any individual be
classified as an Employee while he or she is in any of the following
categories:
(a) Independent contractors, including non-employee directors
of the Company and its subsidiaries.
(b) Leased employees.
(c) Non-resident aliens.
(d) Collective bargaining unit members.
Measurement Fund: Any of the measurement funds provided for under the
----------------
Plan from time to time. As of January 1, 2001, the Measurement Funds include
the Fixed Income Fund described in Section VI, the Vanguard Institutional
Index Fund (designed to mirror approximately the return of the Standard and
Poors' S&P 500 Index), the Vanguard Total Stock Market Index Fund
(Institutional Shares) (designed to mirror approximately the return of the
Wilshire 5000 Index) and a Money Market Rate Fund, which shall provide a
yield equal to the Company's current monthly average commercial paper cost
for each calendar month.
Participant: With respect to any Year, an Eligible Employee who elects
-----------
to defer a portion of his or her Eligible Compensation for the Year or an
Eligible Employee or former Eligible Employee who so elected with respect
to an earlier Year and has an Account during the Year.
Participating Employer: The Company and any other business entity in
----------------------
which the Company has an equity interest of at least fifty percent (50%),
and which maintains this Plan pursuant to Section X, as determined from time
to time.
Plan: Anheuser-Busch Executive Deferred Compensation Plan, the Plan
----
set forth herein, as duly amended from time to time.
Related Employer: Each Participating Employer and each other legal
----------------
entity as to which the Company has at least fifty percent (50%) of the voting
power.
Year: Each calendar year commencing on or after January 1, 1994.
----
2
<PAGE> 3
II. ELIGIBILITY
An Employee shall be an Eligible Employee for a Year only if the sum of
the Employee's annual rate of Base Salary as of October 1 of the immediately
preceding calendar year and the Employee's Bonus for the second preceding
calendar year exceeds $250,000, as adjusted for each Year after 1994 in
accordance with the Company's budgeted internal merit increase factor for
that Year (hereinafter "$250,000 As Adjusted").
III. DEFERRAL ELECTIONS
3.01 Types of Election; Time of Election. Each Participant for a
-----------------------------------
Year shall make the following elections in writing on a form
provided by the Company and delivered to the Company not later
than the Company may direct.
(a) If the Participant is an Eligible Employee for the Year,
the portion of the Participant's Eligible Compensation for
the Year that shall be deferred; however:
(i) The maximum portion of each installment of a
Participant's Base Salary subject to deferral
election hereunder shall be equal to a pro rata
--------
share of the portion of the Participant's Base
Salary in excess of $250,000 As Adjusted. If by
reason of Sec. 3.04, an installment is insufficient
to support any deferral, no make-up deferral shall
be made from any future Base Salary installment.
(ii) If a Participant's annual Base Salary rate is
changed during a Year, the amounts deferred prior
to the date of change shall not be changed. The
maximum portion of each installment that can be
deferred after the change shall be determined by:
(i) adding (a) the Participant's actual Base Salary
-
for the portion of the Year before the effective
date of the change, and (b) the Participant's Base
-
Salary rate per pay period on the effective date of
the change multiplied by the number of pay periods
remaining in the Year on the effective date of the
change; (ii) subtracting from this sum (a) $250,000
-
As Adjusted, and (b) the total amount deferred
-
during the Year before the effective date of the
change; and (iii) dividing the remainder by the
number of pay periods remaining in the Year as
of the effective date of the change.
(iii) The maximum portion of a Participant's Bonus subject
to deferral election hereunder shall be equal to
the amount by which the Participant's Eligible
Compensation exceeds the
3
<PAGE> 4
sum of the portion of the Participant's Base Salary
deferred hereunder plus $250,000 As Adjusted.
(iv) If any portion of a Participant's total compensation
from all Participating Employers for a Year would
not be deductible for the Year by any Participating
Employer under section 162(m) of the Internal
Revenue Code, the Participant may elect to defer an
indefinite amount equal to such non-deductible
portion of the Participant's compensation, and the
Company may adopt such special rules and procedures
as it deems appropriate to carry out such election.
(b) The period of deferral for amounts deferred during the
Year, which may be a definite period of five (5), ten
(10), fifteen (15) or twenty (20) Years including the Year
of deferral, or an indefinite period ending on termination
of the Participant's employment with all Related
Employers, subject to extension provided for in Secs.
3.01(d), 3.01(e) and 3.02 or acceleration as provided for
in Secs. 7.01(b), 7.05, 7.06 and 7.07.
(c) Whether payment of the Participant's Deferral Amounts for
the Year and any income, gain or loss thereon shall be
made in a single sum, in five (5) installments, or in ten
(10) installments (subject to acceleration as provided for
in Secs. 7.02(c), 7.05, 7.06 and 7.07), or in a series of
substantially equal periodic payments (not less frequent
than annually) for a period of 10 years, as provided for
in 4 U.S.C. Sec. 114.
(d) Whether payment of the Participant's Deferral Amounts for
the Year and any income, gain or loss thereon that become
due on account of termination of the Participant's
employment with all Related Employers shall begin as of
the first day of the calendar month following the
termination or the January 1 following the termination.
(e) Except as provided for in this Sec. 3.01(e), all elections
pursuant to this Sec. 3.01 shall be irrevocable.
Notwithstanding anything, a Participant may elect (i) a
longer deferral period permitted under Sec. 3.01(b),
including without limitation the period ending on
termination of employment, (ii) a longer period for
payment of installments permitted under Sec. 3.01(c) for
amounts previously deferred under the Plan or (iii) the
later commencement date permitted in Sec. 3.01(d);
provided that such an election shall be of no force or
effect unless the Participant provides the Company with
written notice of the change at least one year prior to
the date payment would begin in the absence of such an
election or termination of the Participant's employment
with all Related Employers, whichever occurs first.
4
<PAGE> 5
3.02. Special Rule for Non-deductible Amounts. Any amount otherwise
---------------------------------------
payable under the Plan in a Year for which the Company determines that the
amount would not be deductible by any Participating Employer under section
162(m) of the Internal Revenue Code shall not be paid until such Year as the
Company determines that the amount has ceased to be non-deductible by any
Participating Employer under section 162(m) of the Internal Revenue Code. In
the case of any inconsistency between this Sec. 3.02 and any other provision
of the Plan, this Sec. 3.02 shall govern, except in the case of Sec. 7.06.
3.03. Termination of Deferrals on Termination of Employment. If a
-----------------------------------------------------
Participant's employment with all Participating Employers is terminated
before the end of a Year as to which the Participant elected to defer a
portion of Eligible Compensation under the Plan:
(a) Except for deferrals described in Sec. 3.01(a)(iv), all
such deferrals shall cease upon such termination of
employment, whether or not the Participant receives any
amounts otherwise classified as Eligible Compensation
after such termination, and
(b) No portion of the Participant's Eligible Compensation
previously deferred during the Year shall be refunded to
the Participant, even though the Participant's total
Eligible Compensation for the Year may be less than
$250,000 As Adjusted.
3.04. Miscellaneous Limitations on Deferral. Notwithstanding Sec.
-------------------------------------
3.01, a Participant's deferral election for a Year shall be of no force or
effect to the extent that it requires deferral of: (i) any amounts the
Participant elects to contribute under the Anheuser-Busch Deferred Income
Stock Purchase and Savings Plan on either a before-tax or after-tax basis and
the Anheuser-Busch 401(k) Restoration Plan; (ii) any amounts the Participant
elects or is required to contribute under the Group Insurance Plan for
Certain Employees of Anheuser-Busch Companies, Inc., the Anheuser-Busch
Dependent Care Assistance Plan, the Anheuser-Busch Salaried Long-Term
Disability Plan, any cafeteria plan designed to comply with section 125 of
the Internal Revenue Code or any other welfare benefit plan maintained by any
Participating Employer; (iii) any payroll taxes, income taxes or any other
taxes required to be withheld from the Participant's compensation which is
subject to such taxes during the Year, including but not limited to FICA
taxes and federal, state and local income taxes required to be withheld on
the Participant's wages for the Year; and (iv) any amounts payable to a court
or other individual or entity by court order.
IV. ACCOUNTS
4.01. Maintenance of Accounts. The Company will maintain an Account
-----------------------
for the benefit of each Participant.
5
<PAGE> 6
4.02. Crediting Deferral Amounts. Each Participant's Account shall be
--------------------------
credited with his or her Deferral Amounts at the time they would have been
paid to the Participant but for his or her deferral election pursuant to Sec.
3.01(a).
4.03. Crediting or Debiting Investment Returns. The Company shall
----------------------------------------
credit or debit, as the case may be, each Participant's Account to reflect
the return on hypothetical investments as provided in Sec. 5.02.
4.04. Debiting Payments. Each Participant's Account shall be debited
-----------------
by the amount of each payment pursuant to Section VII with respect to the
Participant at the time of such payment.
V. HYPOTHETICAL INVESTMENTS
5.01. Election of Hypothetical Investments.
------------------------------------
(a) Prior to becoming a Participant, each Eligible Employee
must select one or more Measurement Funds in which he or
she wishes hypothetically to invest (including Rate/Term
combinations under the Fixed Income Fund, if applicable).
(b) A Participant may change his or her combination of
Measurement Funds as of the first day of any calendar
month, by notice in form prescribed by the Company, at
such time before the effective date of the change as the
Company may require, subject to the limitations of
Sec. 6.01(g), if applicable.
(c) A Participant's right to change his or her combination of
Measurement Funds shall continue until the entire amount
of his or her Account is distributed pursuant to Section
VII. If a Participant dies before distribution of the
Participant's entire Account is complete, the
Participant's beneficiary shall have the right to make the
elections reserved to the Participant in Sec. 5.01(b) from
the date the Company receives written notice of the
Participant's death through the date of final
distribution; provided: (i) if a deceased Participant has
two or more beneficiaries, the beneficiaries shall
thereafter have the right to make such elections with
respect to the shares of the Participant's Account to
which they are respectively entitled as of the date the
Company receives written notice of the Participant's
death; and (ii) if a beneficiary is a minor or otherwise
legally incompetent, a parent or legal guardian of the
beneficiary, as the case may be, shall exercise such right
on behalf of the beneficiary.
6
<PAGE> 7
5.02. Crediting Returns. The Company shall, at such times and in such
-----------------
manner as it in its sole discretion determines to be appropriate, credit or
debit each Participant's Account, as the case may be, with the appropriate
amount of income, gain or loss, as if such Account had been invested in the
combination of Measurement Funds the Participant has selected in accordance
with Section 5.01.
5.03. If Payment Is Delayed.
---------------------
(a) In the event payment of an amount due a Participant occurs
thirty (30) or fewer days after its due date, no income,
gain or loss shall accrue during the period between the
due date and the date of payment.
(b) In the event payment of any amount due a Participant
occurs more than thirty (30) days after its due date,
interest shall accrue during the period between the due
date and the date of payment at an annual rate equal to
the prime rate published by the Wall Street Journal,
Midwest Edition, as of the due date.
5.04. If Payment Is Accelerated. If payment of an amount due a
-------------------------
Participant is accelerated for any reason, no interest shall accrue with
respect to the accelerated amount after the date scheduled for accelerated
payment, notwithstanding that the Participant may previously have elected a
longer term or a later payment date, except as provided for in Sec. 5.03(b).
VI. FIXED INCOME FUND
6.01. Operation of the Fixed Income Fund. The Fixed Income Fund
----------------------------------
shall be operated as follows:
(a) Before the beginning of each Year, the Company shall offer
one or more combinations of interest rates (hereinafter
"Rates") and time periods (hereinafter "Terms") which
shall be available during the Year with respect to current
Deferral Amounts, prior Deferral Amounts as to which the
previous Terms expired on December 31 of the prior Year,
and existing Account balances in other Measurement Funds
from time to time during the Year.
(b) The Rates and Terms for each Year shall be determined by
the Chief Financial Officer of the Company and shall
correspond generally to the borrowing rates and terms that
are expected to be available to the Company for the Year
on the basis of market rates in effect prior to
announcement to Eligible Employees of the Rates and Terms
for the Year.
7
<PAGE> 8
(c) All Terms shall commence on a January 1 and expire on
a December 31. For example, if a Participant elects a
combination of a 3-Year Term and a 3% Rate for all amounts
deferred by the Participant for 2001, the 3% Rate shall
apply to all amounts deferred for 2001 from the date of
deferral through December 31, 2003.
(d) The Terms elected by a Participant need not be limited to
the deferral period for the amount subject to the Term
elected. For example, a Participant may elect a 10-Year
Term for an amount the Participant has elected to be
distributed after 5 Years.
(e) A Participant may make separate elections regarding the
Rate/Term combinations for the Participant's current
Deferral Amounts, existing Account balances in other
Measurement Funds and amounts attributable to prior
Deferral Amounts and interest accrued thereon as to which
the previous Terms expired on December 31 of the prior
Year.
(f) Notwithstanding anything, a Participant may elect that all
or any portion of his or her Account in existence as of
December 31, 2000 be transferred to another Measurement
Fund or another Rate/Term combination available under the
Fixed Income Fund as of January 1, 2001, whether or not
the Term that applies to any portion of the Participant's
Account would otherwise have expired on December 31, 2000.
(g) A Participant may elect transfer of his or her current
Deferral Amounts or any portion of his or her existing
Account then hypothetically invested in other Measurement
Funds into the Fixed Income Fund after the first day of a
Year. However, except as provided in Sec. 6.01(f), any
amounts that a Participant elects to transfer into the
Fixed Income Fund during a Year shall remain in the Fixed
Income Fund until expiration of the Term elected by the
Participant with respect to such amounts, and interest
shall begin to accrue on any such amounts as of the
effective date of the Participant's election or the date
they would have been paid to the Participant if the
Participant had not elected deferral thereof, whichever
is later.
6.02. Accrual of Interest on Installment Payments. If any amount in
-------------------------------------------
the Fixed Income Fund is paid in installments pursuant to a Participant's
election in accordance with Sec. 3.01(c) or (e), interest shall accrue on any
balance thereof remaining to be paid in installments from time to time in
accordance with the Participant or beneficiary's elections from time to time
as provided for in Sec. 5.01 until payment is complete; provided, in the
absence of an election by a Participant or beneficiary in accordance with the
8
<PAGE> 9
foregoing, the Participant or beneficiary shall be deemed to have elected the
Rate in effect for the longest time period available as of the due date of
the election.
VII. PAYMENTS TO PARTICIPANTS
7.01. Time Payment Begins.
-------------------
(a) Subject to the remaining provisions of this Section VII,
payment of the portion of a Participant's Account
attributable to amounts deferred for a Year shall begin
as of January 1 of the Year following expiration of the
deferral period the Participant elected therefor in
accordance with Sec. 3.01(b) or (e).
(b) Notwithstanding Sec. 7.01(a), payment of a Participant's
Account shall begin not later than the first day of the
calendar month following termination of the Participant's
employment with all Related Employers on account of
retirement, death or any reason or the January 1 following
the termination, as elected by the Participant pursuant to
Sec. 3.01(d) or (e).
7.02. Form of Payment.
---------------
(a) If a Participant elects payment of any amount in a single
sum pursuant to Sec. 3.01(c), such single sum amount shall
be due and payable as of the date determined pursuant to
Sec. 7.01.
(b) If a Participant elects payment of any amount in five (5)
or ten (10) installments pursuant to Sec. 3.01(c) or (e),
the initial installment shall be paid as of the first day
of the calendar month following termination of the
Participant's employment with all Related Employers or as
of the January 1 following the termination, as elected by
the Participant pursuant to Sec. 3.01(d) or (e), and the
remaining four (4) or nine (9) installments shall be paid
as of January 1 of the next four (4) or nine (9) calendar
years.
(c) If a Participant elects payment of any amount in a series
of substantially equal period payments (not less frequent
than annually) for a period of 10 years, as provided for
in 4 U.S.C. Sec. 114, the Company shall modify the
installment method provided for in Secs. 7.02(b) and 7.04
to the extent required to satisfy the requirements of
4 U.S.C. Sec. 114.
(d) Notwithstanding Secs. 7.02(b) and (c): (i) if a
Participant's employment with all Related Employers
terminates before age fifty-five (55) for any reason other
than the Participant's death or disability, or (ii) if a
9
<PAGE> 10
Participant's termination of employment with all Related
Employers occurs before the end of the Participant's first
Year of deferral under the Plan, the Company may determine
that payment of the Participant's entire Account under
the Plan shall be paid in a single sum, notwithstanding
any election by the Participant to the contrary.
7.03. Set Off and Withholding.
-----------------------
(a) Any amount then due and payable by the Company to any
Participant or the successor to any Participant under
this Plan may be offset by any amounts owed to any Related
Employer by the Participant and/or the successor for any
reason and in any capacity whatsoever, as the Company may
determine in its sole and absolute discretion.
(b) There shall be deducted from any amount payable under this
Plan all taxes required to be withheld by any federal,
state or local government. Participants and their
beneficiaries shall bear any and all federal, state, local
and other income taxes and other taxes imposed on amounts
paid under the Plan, whether or not withholding is
required or carried out in accordance with this provision.
7.04. Determination of Installment Amounts. If payment of any portion
------------------------------------
of a Participant's Account occurs in installments, the amount of each
installment shall be equal to the amount thereof remaining unpaid as of the
December 31 preceding payment, divided by the number of installments then
remaining to be paid. For example, with respect to an Account that is
payable in five (5) installments, to determine the amount of the first
installment, divide the total amount of the Account as of the preceding
December 31 by five (5); to determine the amount of the second installment,
divide the amount of the Account remaining to be paid as of the preceding
December 31 by four (4), and so on. Notwithstanding the foregoing, the
company shall modify the installment method provided for in this Sec. 7.04
to the extent required by Sec. 7.02(c).
7.05. Acceleration of Payment for Unforeseeable Emergency.
---------------------------------------------------
(a) The Company may determine that payment of any portion
of a Participant's Account under the Plan shall be
accelerated on application of the Participant or
beneficiary on account of and subject to reasonable
proof of unforeseeable emergency as provided for in this
Sec. 7.05.
(b) For purposes of this Sec. 7.05, an unforeseeable emergency
is a severe financial hardship to the Participant or
beneficiary resulting from a sudden and unexpected illness
or accident of the Participant or beneficiary or of a
dependent (as defined in section 152(a) of the
10
<PAGE> 11
Internal Revenue Code) of the Participant or beneficiary,
loss of the Participant's or beneficiary's property due to
casualty, or other similar extraordinary and unforeseeable
circumstances arising as a result of events beyond the
control of the Participant or beneficiary. The
circumstances that will constitute an unforeseeable
emergency will depend upon the facts of each case, but, in
any case, payment may not be made to the extent that such
hardship is or may be relieved--
(i) Through reimbursement or compensation by insurance
or otherwise,
(ii) By liquidation of the Participant's or beneficiary's
assets, to the extent the liquidation of such assets
would not itself cause severe financial hardship, or
(iii) By cessation of deferrals under this Plan or by
cessation of elective deferrals if and when possible
under any other deferred compensation plan for which
the Participant or beneficiary is eligible; provided
that a Participant shall not be permitted to cease
deferrals under this plan as of any date other than
a January 1.
Examples of what are not considered to be unforeseeable emergencies
include the need to send a Participant's or beneficiary's child to
college or the desire to purchase a home.
(c) Withdrawal of amounts because of an unforeseeable
emergency shall be permitted only to the extent reasonably
needed to satisfy the emergency need.
(d) All determinations under this Sec. 7.05 shall be made
by an Administrative Committee appointed pursuant to
Sec. 8.01(c).
(e) Notwithstanding any other provision of this Sec. 7.05,
authorization of distribution on account of hardship under
the Anheuser-Busch Deferred Income Stock Purchase and
Savings Plan shall automatically terminate any deferral
election of the Participant then in force with respect to
Eligible Compensation and further deferrals under this
Plan shall not be permitted for a period of twelve
(12) months.
7.06. Change in Control.
-----------------
(a) If a Change in Control (as defined in Sec. 7.06(b)) shall
occur, then, notwithstanding anything to the contrary
herein, the entire amount
11
<PAGE> 12
of a Participant's Account under the Plan as of the Change
in Control Date shall be paid in a single sum within
30 days after the Change in Control Date.
(b) For purposes of this Plan, a "Change in Control" shall
occur automatically if and when an "Acceleration Date"
occurs as defined in the Company's 1998 Incentive Stock
Plan or if and when an analogous change in control event
occurs as defined in any successor to such plan, and the
Change in Control Date shall be the Acceleration Date or
analogous date as defined therein.
(c) This Sec. 7.06 may be deleted or amended in any way
pursuant to Section IX at any time prior to a Change in
Control. Notwithstanding Section IX, following a Change in
Control, the provisions of this Sec. 7.06 cannot, after
the Change in Control Date, be amended in any manner
without the written consent of each individual who was a
Participant immediately prior to the Change in Control.
(d) Following a Change in Control, this Plan may continue in
effect, notwithstanding that payment of benefits shall
have been made under Sec. 7.06(a).
(e) If by reason of this Sec. 7.06 an excise or other special
tax ("Excise Tax") is imposed on any payment under the
Plan (a "Required Payment"), the amount of each Required
Payment shall be increased by an amount which, after
payment of income taxes, payroll taxes and Excise Tax
thereon, will equal such Excise Tax on the Required
Payment.
7.07. General Right to Accelerate Payment. Notwithstanding Secs. 7.01
-----------------------------------
and 7.02, the Company by its proper officers in its sole discretion may
direct current payment of all Participants' Accounts under the Plan.
7.08. Payments After Death.
--------------------
(a) Except as otherwise provided in this Sec. 7.08, any amount
payable under this Plan as a result of or following the
death of a Participant shall be applied only for the
benefit of the beneficiary or beneficiaries designated by
the Participant pursuant to this Sec. 7.08. Each
Participant shall specifically designate, by name, on
forms provided by the Company, the beneficiary(ies) to
whom any such amounts shall be paid. A Participant may
change or revoke a beneficiary designation without the
consent of the beneficiary(ies) at any time by filing a
new beneficiary designation form with the Company. The
filing of a new form shall automatically revoke any
12
<PAGE> 13
forms previously filed with the Company. A beneficiary
designation form not properly filed with the Company prior
to the death of the Participant shall have no validity
under the Plan.
(b) Any such designation shall be contingent on the designated
beneficiary surviving the Participant. If a designated
beneficiary survives the Participant but dies before
receiving the entire amount payable to the designated
beneficiary hereunder, the amount which would otherwise
have been so paid shall be paid to the estate of the
deceased beneficiary unless a contrary direction was made
by the Participant, in which case such direction shall
control. More than one beneficiary, and alternative or
contingent beneficiaries, may be designated, in which case
the Participant shall specify the shares, terms and
conditions upon which amounts shall be paid to such
multiple or alternative or contingent beneficiaries, all
of which must be satisfactory to the Company.
(c) If no beneficiary designation is on file with the Company
at the time of the Participant's death or no beneficiary
designated by the Participant survives the Participant,
the Participant's estate shall be deemed to be the
beneficiary designated to receive any portion of the
Participant's Account then remaining payable under this
Plan.
(d) In determining any question concerning a Participant's
beneficiary, the latest designation filed with the Company
shall control and intervening changes in circumstances
shall be ignored; provided, if a Participant's spouse is
designated as beneficiary but thereafter is divorced from
the Participant, such designation shall become invalid as
of the date of divorce unless the Participant files a
beneficiary designation form with the Company after the
date of divorce confirming designation of such former
spouse as beneficiary.
(e) Any check issued on or before the date of a Participant's
death shall remain payable to the Participant, whether or
not the check is received by the Participant prior to
death. Any check issued after the date of the
Participant's death shall be the property of the
Participant's beneficiaries determined in accordance with
this Sec. 7.08.
(f) A Participant's election of payment in installments shall
not be altered by reason of the Participant's death.
7.09. All Payments to be Made by the Company. All payments due any
--------------------------------------
Participant or beneficiary under this Plan shall be the sole responsibility
of the Company.
13
<PAGE> 14
VIII. ADMINISTRATION
8.01. Administrative Duties of the Company.
------------------------------------
(a) The Company shall have sole responsibility for the
administration of the Plan.
(b) The Company shall administer the Plan in accordance with
its terms and shall have all powers necessary to carry out
the provisions of the Plan. The Company shall interpret
the Plan; shall determine all questions arising in the
administration, interpretation, and application of the
Plan; and shall construe any ambiguity, supply any
omission, and reconcile any inconsistency in such manner
and to such extent as the Company deems proper. Any
interpretation or construction placed upon any term or
provision of the Plan by the Company, any decisions and
determinations of the Company arising under the Plan,
including without limiting the generality of the
foregoing: (i) the eligibility of any individual to
become or remain a Participant and a Participant's status
as such, and Eligible Compensation for any Year; (ii) the
time, method and amounts of payments payable under the
Plan; (iii) the rights of Participants; and any other
action or determination or decision whatsoever taken or
made by the Company in good faith shall be final,
conclusive, and binding upon all persons concerned,
including, but not limited to, the Company, all
Participating Employers and all Participants and
beneficiaries.
(c) The Chief Financial Officer of the Company shall appoint
one or more Employees to carry out the Company's duties
hereunder.
(d) The Company may employ accountants, counsel, specialists
and other persons necessary to help carry out its duties
and responsibilities under the Plan. The Company or any
appointee shall be entitled to rely conclusively upon any
opinions or reports which shall be furnished to it or him
by such accountants, counsel, specialists, and other
persons.
(e) No Employee shall participate in determining his or her
own entitlement under the Plan.
8.02. Claims Procedures.
-----------------
(a) The Company shall make all decisions and determinations
respecting the right of any person to a payment under
the Plan.
14
<PAGE> 15
(b) The following procedure shall be followed with respect to
claims under the Plan:
(i) Any claimant who believes he or she is entitled to
a benefit under this Plan shall submit a claim for
such benefit in writing to the Company.
(ii) Any decision by the Company denying a claim in whole
or in part shall be stated in writing by the Company
and delivered or mailed to the claimant within
ninety (90) days after receipt of the claim by the
Company unless special circumstances require an
extension of time for processing, but in any event
within one hundred eighty (180) days after such
receipt. If such an extension of time is taken, the
Company shall inform the claimant of the delay in
writing before the expiration of the initial ninety
(90) day period, including the reasons therefor and
the date by which the Company expects to render a
decision. Any decision denying a claim shall set
forth the specific reasons for the denial with
specific references to Plan provisions on which the
denial is based, a description of any additional
material or information necessary to perfect the
claim and the reasons therefor, and an explanation
of the Plan's claim review procedure as provided for
in Sec. 8.02(b)(iii), all written in a manner
calculated to be understood by the claimant. If the
Company does not notify the claimant of denial of
the claim or the need for an extension of time
within the initial ninety (90) day period, the claim
shall be deemed denied.
(iii) If a claim is denied in whole or in part, the
claimant or his or her duly authorized
representative may request a review by the Company
of the decision upon written application to the
Company within sixty (60) days after notification of
the decision. The claimant or his or her duly
authorized representative may review pertinent
documents and submit issues and comments in writing.
The Company shall make its decision on review not
later than sixty (60) days after receipt of the
request for review unless special circumstances
require an extension of time for processing, in
which case its decision shall be rendered as soon as
possible, but not later than one hundred twenty
(120) days after receipt of the request for review.
If such an extension of time is taken, the Company
shall inform the claimant of the delay in writing
before the expiration of the initial sixty (60) day
period. The decision on review shall be in writing
and shall include specific reasons for the decision,
written in
15
<PAGE> 16
a manner calculated to be understood by the claimant
and specific references to the pertinent plan
provisions on which the decision is based. If the
Company does not notify the claimant of its decision
on review within the period herein provided for, the
claim shall be deemed denied on review.
(c) The Company may adopt such rules as it deems necessary,
desirable, or appropriate to carry out its duties under
this Sec. 8.02. All rules, decisions and determinations
of the Company under this Sec. 8.02 shall be uniformly and
consistently applied. Any action or determination or
decision whatsoever taken or made by the Company under
this Sec. 8.02 in good faith shall be final, conclusive,
and binding upon all persons concerned, including, but not
limited to, the Company, all Participating Employers and
all Participants and beneficiaries.
(d) The procedure provided for in this Sec. 8.02 shall be the
sole, exclusive and mandatory procedure for resolving any
dispute under this Plan; provided that if a Participant
wishes to make a legal challenge to the Company's
determination and he or she has entered into an agreement
with the Company to arbitrate disputes arising from his or
her employment with the Company, such legal challenge
shall be resolved pursuant to the arbitration procedures
in that agreement and the Participant's burden of proof in
any arbitration shall be the same as if the dispute were
tried in a court proceeding.
(e) Notwithstanding the foregoing, upon a Change in Control as
defined in Sec. 7.06, Sec. 8.02(d) shall not apply.
8.03. Books and Records.
-----------------
(a) The Company shall keep such books, records, and other data
as it deems necessary for proper administration of the
Plan, including but not limited to records of each
Participant's Eligible Compensation, elections, Account,
amounts payable to each Participant from time to time, and
amounts paid to each Participant or beneficiary from time
to time.
(b) The records of the Company shall be conclusive on all
persons unless proved incorrect to the satisfaction of
the Company.
(c) The Company shall comply with all reporting and disclosure
requirements of the law and shall maintain all records
required by law.
16
<PAGE> 17
8.04. Notices.
-------
(a) Any notice from the Company to any Participant shall
be in writing and shall be given by delivery to the
Participant, or by mailing to the last known residence
address of the Participant. Any notice from a Participant
to the Company shall be in writing and shall be given by
delivery to the Pension Department of the Company at the
Company's headquarters, except as otherwise designated by
the Company. Notices shall be effective on the date of
actual delivery.
(b) Each Participant shall furnish all information, including
post office address and each change of post office
address, proofs, receipts and releases, as may be required
by the Company.
(c) Any communication, statement or notice addressed to any
individual at the last post office address filed with the
Company shall be binding for all purposes of the Plan, and
the Company shall not be obligated to search for or
ascertain the whereabouts of any such individual.
(d) Except for Participants' deferral and investment elections
under the Plan, any notice required by the Plan may be
waived by the Company or any Participant.
IX. AMENDMENT AND TERMINATION
The Chief Financial Officer of the Company shall have authority to
amend or terminate the Plan on behalf of the Company in his sole discretion
at any time, except as follows:
(a) Amendments that provide for substantial increases in
benefits shall require approval by the Compensation
Committee of the Board of Directors of the Company.
(b) No amendment shall reduce the amount accrued for the
benefit of a Participant immediately prior to the
effective date of the amendment.
(c) No amendment shall reduce any Rate elected by a
Participant before expiration of the Term provided
therefor when the election was made unless the amount
governed by the Rate and Term is distributed to the
Participant in connection with termination of the Plan or
otherwise pursuant to the Plan.
17
<PAGE> 18
X. PARTICIPATING EMPLOYERS OTHER THAN THE COMPANY
10.01. Adoption. A Participating Employer other than the Company shall
--------
adopt this Plan by written instrument executed by its proper officers,
subject to the written approval of the Company. Adoption of the Plan by a
Participating Employer shall constitute automatic delegation of all rights
and duties it might otherwise reserve to itself under the Plan to the
Company, including full authority to amend or terminate the Plan.
10.02. Withdrawal. A Participating Employer shall automatically
----------
withdraw from the Plan if and when the Company ceases to have an equity
interest of at least fifty percent (50%) without the execution of any other
instrument. A Participating Employer may voluntarily withdraw from the Plan
on not less than thirty (30) days' written notice from its proper officers.
10.03. Succession. In the event of dissolution, merger, consolidation,
----------
or spin-off involving a Participating Employer, the entity surviving the
transaction shall succeed to the rights and duties of the affected
Participating Employer without the execution of any other instrument.
XI. MISCELLANEOUS
11.01. Company's Obligations Unsecured. It is the intention of the
-------------------------------
Company and all Participants that the Plan shall be unfunded for tax purposes
and for purposes of Title I of the Employee Retirement Income Security Act of
1974, as amended from time to time. Amounts payable to Participants under
this Plan shall be paid solely from the general assets of the Company as they
come due from time to time. No Participant and no successor of any
Participant shall have any property interest whatsoever in any asset of the
Company on account of participation in this Plan. Participants' rights under
this Plan shall be no greater than the right of an unsecured general creditor
of the Company. Nothing in this Plan shall require the Company to invest
any amount in any asset or type of asset.
11.02. No Alienation. Except as required by law, amounts payable under
-------------
this Plan shall not be subject in any manner to anticipation, alienation,
sale, transfer, assignment, pledge, encumbrance, charge, garnishment,
execution, or levy of any kind, either voluntary or involuntary; any attempt
to anticipate, alienate, sell, transfer, assign, pledge, encumber, charge or
otherwise dispose of any right to payment hereunder shall be void, and the
Company shall not in any manner be liable for, or subject to, the debts,
contracts, liabilities, engagements or torts of any Participant or other
person.
11.03. No Waiver of Rights. Except as provided for in Sec. 8.02, no
-------------------
failure or delay by the Company or any Participant to exercise any right,
power or privilege hereunder shall operate as a waiver thereof, nor shall any
single or partial exercise thereof preclude any other or further exercise
thereof or the exercise of any other right, remedy, power or privilege.
18
<PAGE> 19
11.04. Severability. The invalidity of any particular clause,
------------
provision or covenant herein shall not invalidate all or any part of the
remainder of this Plan, but such remainder shall be and remain valid in all
respects as fully as the law will permit.
11.05. Legal Expenses. In any proceeding to enforce rights and
--------------
obligations hereunder, the unsuccessful party shall pay the successful party
an amount equal to all reasonable out-of-pocket expenses (including
reasonable legal expenses and court costs) incurred by the successful party.
11.06. Presumption of Competence. Every person receiving or claiming
-------------------------
amounts payable under this Plan shall be conclusively presumed to be mentally
competent and of legal age unless and until the Company receives proof
satisfactory to the Company that the person is incompetent or is a minor or
that a guardian or other person legally vested with the care of the person's
estate has been appointed.
11.07. Facility of Payment. If any amount is payable hereunder to a
-------------------
minor or other person under legal disability or otherwise incapable of
managing his or her own affairs, as determined by the Company in its sole
discretion, payment thereof shall be made in one (or any combination) of the
following ways, as the Company shall determine in its sole discretion:
(i) Directly to said minor or other person;
(ii) To a custodian for said minor or other person
(whether designated by the Company or any other
person) under the Missouri Transfers to Minors Law,
the Missouri Personal Custodian Law or a similar law
of any other jurisdiction;
(iii) To the conservator of the estate of said minor or
other person; or
(iv) To some relative or friend of such minor or other
person for the support, welfare or education of such
minor or other person.
The Company shall not be required to see to the application of any payment so
made, and payment to the person determined by the Company shall fully
discharge the Company from any further accountability or responsibility with
respect to the amount so paid.
11.08. No Guarantee of Employment or Compensation. No provision of
------------------------------------------
this Plan shall restrict any Related Employer from discharging a Participant
from employment or restrict any Participant from resigning from employment
with any Related Employer. No provision of this Plan shall restrict any
Related Employer from increasing or decreasing the compensation of any
Employee.
19
<PAGE> 20
11.09. Plan Provisions Binding. The provisions of the Plan shall be
-----------------------
binding upon the Company, all Participating Employers and all persons
entitled to benefits under the Plan and their respective successors, heirs
and legal representatives.
11.10. Rules of Interpretation. Words of gender shall include persons
-----------------------
and entities of any gender, the plural shall include the singular, and the
singular shall include the plural. Captions are intended to assist in
reference and shall not be interpreted as part of the Plan.
11.11. Missouri Law Controls. Subject to the applicable provisions of
---------------------
the Employee Retirement Income Security Act of 1974 which provide to the
contrary, this Plan shall be administered, construed, and enforced according
to the laws of the State of Missouri (other than choice of law) and in Courts
situated in that State. The Company and all Eligible Employees and former
Eligible Employees submit to the exclusive jurisdiction of the Circuit Court
for the County of St. Louis, State of Missouri ("County Court") residing in
St. Louis County for purposes of all legal proceedings (including, but not
limited to, actions to compel arbitration) arising out of or relating to this
Plan or the transactions contemplated hereby. In the even that the County
Court is for any reason not available for purposes of any such legal
proceeding, then the Company and all Eligible Employees and former Eligible
Employees submit to the exclusive jurisdiction of the United States District
Court for the Eastern District of Missouri, Eastern Division (St. Louis).
The Company and all Eligible Employees and former Eligible Employees
irrevocably waive, to the fullest extent permitted by law, any objections
that they may now or hereafter have to the aforesaid venue, including without
limitation any claim that any such proceeding brought in either such court
has been brought in an inconvenient forum, provided however, this provision
shall not limit the ability of the Company or any Eligible Employee or form
Eligible Employee to enforce the other provisions of this section.
11.12. Counterparts. This Plan may be executed in two or more
------------
counterparts, any one of which shall constitute an original without reference
to the others.
IN WITNESS WHEREOF, Anheuser-Busch Companies, Inc. executed this
amended and restated Plan this 21st day of December, 2000, effective as of
the 1st day of January, 2001.
ANHEUSER-BUSCH COMPANIES, INC.
By /s/ W. Randolph Baker
---------------------------
W. Randolph Baker
Chief Financial Officer
20
<PAGE> 21
ANHEUSER-BUSCH
EXECUTIVE DEFERRED COMPENSATION PLAN
Amended and Restated as of January 1, 2001
<PAGE> 22
TABLE OF CONTENTS
-----------------
Preamble 1
- --------
I. DEFINITIONS 1
Base Salary 1
Bonus 1
Company 1
Effective Date 1
Eligible Compensation 1
Eligible Employee 2
Employee 2
Measurement Fund 2
Participant 2
Participating Employer 2
Plan 2
Related Employer 2
Year 2
II. ELIGIBILITY 3
III. DEFERRAL ELECTIONS 3
3.01. Types of Election; Time of Election 3
3.02. Special Rule for Non-deductible Amounts 5
3.03. Termination of Deferrals on Termination of Employment 5
3.04. Miscellaneous Limitations on Deferral 5
IV. ACCOUNTS 5
4.01. Maintenance of Accounts 5
4.02. Crediting Deferral Amounts 6
4.03. Crediting or Debiting Investment Returns 6
4.04. Debiting Payments 6
V. HYPOTHETICAL INVESTMENTS 6
5.01. Election of Hypothetical Investments 6
5.02. Crediting Returns 7
5.03. If Payment is Delayed 7
5.04. If Payment is Accelerated 7
i
<PAGE> 23
VI. FIXED INCOME FUND 7
6.01. Operation of the Fixed Income Fund 7
6.02. Accrual of Interest on Installment Payments 8
VII. PAYMENTS TO PARTICIPANTS 9
7.01. Time Payment Begins 9
7.02. Form of Payment 9
7.03. Set Off and Withholding 10
7.04. Determination of Installment Amounts 10
7.05. Acceleration of Payment for Unforeseeable Emergency 10
7.06. Change in Control 11
7.07. General Right to Accelerate Payment 12
7.08. Payment After Death 12
7.09. All Payments to be Made by the Company 13
VIII. ADMINISTRATION 14
8.01. Administrative Duties of the Company 14
8.02. Claims Procedures 14
8.03. Books and Records 16
8.04. Notices 17
IX. AMENDMENT AND TERMINATION 17
X. PARTICIPATING EMPLOYERS OTHER THAN THE COMPANY 18
10.01. Adoption 18
10.02. Withdrawal 18
10.03. Succession 18
XI. MISCELLANEOUS 18
11.01. Company's Obligations Unsecured 18
11.02. No Alienation 18
11.03. No Waiver of Rights 18
11.04. Severability 19
11.05. Legal Expenses 19
11.06. Presumption of Competence 19
11.07. Facility of Payment 19
11.08. No Guarantee of Employment or Compensation 19
11.09. Plan Provisions Binding 20
11.10. Rules of Interpretation 20
11.11. Missouri Law Controls 20
11.12. Counterparts 20
ii
<PAGE> 24
iii
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-12
<SEQUENCE>6
<FILENAME>eoex12.txt
<DESCRIPTION>EXHIBIT 12
<TEXT>
<PAGE> 1
EXHIBIT 12
RATIO OF EARNINGS TO FIXED CHARGES
The following table sets forth the ratio of the Company's earnings
to fixed charges, on a consolidated basis, for the periods
indicated:
<TABLE>
<CAPTION>
Year Ended December 31
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
2000 1999 1998 1997 1996 1995
- - - - - - - - - - - - - - - - - - - - - - - - -
<S> <C> <C> <C> <C> <C>
6.7X 6.9X 6.8X 7.3X 8.1X 2/ 6.6X 1/
For purposes of this ratio, earnings have been calculated by
adding to income before income taxes the distributed earnings of
investees accounted for under the equity method and the amount of
fixed charges. Fixed charges consist of interest on all
indebtedness, amortization of debt discounts and that portion of
rental expense deemed to represent interest.
<FN>
1/ The ratio for 1995 includes the impact of the Tampa Brewery
shutdown and the reduction of beer wholesaler inventories.
Excluding these non-recurring items, the ratio would have been
7.6X.
2/ The ratio for 1996 includes the gain from the sale of the St.
Louis Cardinals Major League Baseball Club, which increased income
before income taxes by $54.7 million. Excluding this one-time gain,
the ratio would have been 7.9X.
</FN>
</TABLE>
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-13
<SEQUENCE>7
<FILENAME>eoex13.txt
<DESCRIPTION>EXHIBIT 13
<TEXT>
<PAGE> 1
ANHEUSER[LOGO]BUSCH
Companies
D E L I V E R I N G
---------------------------------------
S H A R E H O L D E R V A L U E
[PHOTO]
[PHOTO]
[PHOTO]
---------------------------------------
F I N A N C I A L R E V I E W
2 0 0 0
C O N T E N T S
Management's Discussion and Analysis
of Operations and Financial Condition 26
Management's Responsibility for Financial
Statements 39
Report of Independent Accountants 39
Consolidated Balance Sheet 40
Consolidated Statement of Income 41
Consolidated Statement of Changes
in Shareholders Equity 42
Consolidated Statement of Cash Flows 43
Notes To Consolidated
Financial Statements 44
Financial Summary -- Operations 56
Financial Summary -- Balance Sheet
and Other Information 58
ANHEUSER-BUSCH COMPANIES 2000 ANNUAL REPORT 25
<PAGE>
<PAGE> 2
ANHEUSER[LOGO]BUSCH
Companies
[PHOTO]
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF OPERATIONS AND FINANCIAL CONDITION
INTRODUCTION
This discussion summarizes the significant factors affecting the
consolidated operating results, financial condition and liquidity/cash flows
of Anheuser-Busch Companies, Inc. for the three-year period ended December
31, 2000. This discussion should be read in conjunction with the Letter to
Shareholders, Consolidated Financial Statements and Notes to the Consolidated
Financial Statements included in this annual report.
This discussion contains statements regarding the company's expectations
concerning its operations, earnings and future outlook. These statements are
forward-looking statements that involve significant risks and uncertainties,
and accordingly, no assurances can be given that such expectations will be
correct. These expectations are based upon many assumptions that the company
believes to be reasonable, but such assumptions may ultimately prove to be
inaccurate or incomplete, in whole or in part. Important factors that could
cause actual results to differ (favorably or unfavorably) from the
expectations stated in this discussion include, among others, changes in the
pricing environment for the company's products; changes in domestic demand
for malt beverage products; changes in consumer preference for the company's
malt beverage products; regulatory or legislative changes; changes in raw
materials prices; changes in interest rates; changes in foreign currency
exchange rates; changes in attendance and consumer spending patterns for the
company's theme park operations; changes in demand for aluminum beverage
containers; changes in the company's international beer business or in the
beer business of the company's international equity partners; and the effect
of stock market conditions on the company's share repurchase program. The
company disclaims any obligation to update any of these forward-looking
statements. If the company determines to update any forward-looking
statement, it will do so publicly. No private statements by the company or
its personnel should be interpreted as updating forward-looking statements.
OBJECTIVES
Anheuser-Busch remains focused on three major objectives to enhance
shareholder value:
* Increasing domestic per barrel profitability which, when combined
with continued market share growth, will provide solid long-term earnings
per share growth.
* Profitable expansion of international beer operations by making selected
investments in leading brewers in key international beer growth markets
and building the Budweiser brand worldwide. The company has made
significant marketing investments to build Budweiser brand recognition
outside the United States and owns overseas breweries in China and the
United Kingdom. The company has a significant equity position in Grupo
Modelo, Mexico's largest brewer and producer of the Corona brand, and
recently purchased an equity position in Compania Cervecerias Unidas,
the leading brewer in Chile.
26 ANHEUSER-BUSCH COMPANIES 2000 ANNUAL REPORT
<PAGE>
<PAGE> 3
* Continued support of profit and free cash flow growth in packaging and
entertainment operations. Packaging operations provide significant
efficiencies, cost savings and quality assurance for domestic beer
operations. Entertainment operations enhance the company's corporate
image by showcasing Anheuser-Busch's heritage, values and commitment to
quality and social responsibility to approximately 21 million visitors
annually.
COMPARISON OF OPERATING RESULTS
The company distributed a two-for-one stock split on September 18, 2000.
All share and per share information in this discussion has been restated to
reflect the impact of the stock split.
Comparisons of key operating results for the last three years are
summarized in the following tables.
<TABLE>
- ----------------------------------------------------------------------------------
COMPARISON OF OPERATING RESULTS ($ IN MILLIONS, EXCEPT PER SHARE)
- ----------------------------------------------------------------------------------
<CAPTION>
2000 1999 2000 VS. 1999
<S> <C> <C> <C> <C>
Gross sales $14,297 $13,723 $574 4.2%
Net sales $12,262 $11,704 $558 4.8%
Operating income $2,495 $2,302 $193 8.4%
Equity income, net of tax $200 $158 $42 27.0%
Net income $1,552 $1,402 $150 10.7%
Diluted earnings per share $1.69 $1.47 $.22 15.0%
- ----------------------------------------------------------------------------------
<CAPTION>
1999 1998 1999 VS. 1998
<S> <C> <C> <C> <C>
Gross sales $13,723 $13,208 $515 3.9%
Net sales $11,704 $11,246 $458 4.1%
Operating income $2,302 $2,125 $177 8.3%
Equity income, net of tax $158 $85 $73 85.2%
Net income $1,402 $1,233 $169 13.7%
Diluted earnings per share $1.47 $1.27 $.20 16.2%
- ----------------------------------------------------------------------------------
<CAPTION>
1998 1997 (1) 1998 VS. 1997
<S> <C> <C> <C> <C>
Gross sales $13,208 $12,832 $376 2.9%
Net sales $11,246 $11,066 $180 1.6%
Operating income $2,125 $2,053 $72 3.5%
Equity income, net of tax $85 $50 $35 68.7%
Net income $1,233 $1,179 $54 4.6%
Diluted earnings per share $1.27 $1.18 $.09 7.2%
- ----------------------------------------------------------------------------------
<FN>
(1) Net income and diluted earnings per share exclude the impact of the cumulative
accounting adjustment for systems reengineering costs per EITF No. 97-13.
Including this adjustment, net income for 1997 would have been $1,169 and
diluted earnings per share would have been $1.17.
</FN>
</TABLE>
BEER VOLUME SALES
Total worldwide beer sales volume results are summarized in the following
table:
<TABLE>
- ----------------------------------------------------------------------------------
WORLDWIDE BEER SALES VOLUME (MILLIONS OF BARRELS)
- ----------------------------------------------------------------------------------
<CAPTION>
2000 1999 CHANGE
<S> <C> <C> <C>
Domestic 98.3 95.7 2.7%
International 7.3 7.2 1.3%
--------------------------------------
Worldwide A-B brands 105.6 102.9 2.6%
International equity partner brands 15.7 15.1 3.9% (1)
--------------------------------------
Total brands 121.3 118.0 2.8% (1)
======================================
<FN>
(1) Normalized to exclude 1999 volume related to Anheuser-Busch's previously held
equity stake in Antarctica, Equity Partner volume increased 6.2%, and Total
Brands volume increased 3.1%, for 2000 vs. 1999.
</FN>
- ----------------------------------------------------------------------------------
<CAPTION>
1999 1998 CHANGE
<S> <C> <C> <C>
Domestic 95.7 92.7 3.2%
International 7.2 7.1 1.2%
--------------------------------------
Worldwide A-B brands 102.9 99.8 3.1%
International equity partner brands 15.1 11.2 34.7%
--------------------------------------
Total brands 118.0 111.0 6.3%
======================================
- ----------------------------------------------------------------------------------
<CAPTION>
1998 1997 CHANGE
<S> <C> <C> <C>
Domestic 92.7 89.6 3.5%
International 7.1 7.0 0.6%
--------------------------------------
Worldwide A-B brands 99.8 96.6 3.3%
International equity partner brands 11.2 6.8 64.9%
--------------------------------------
Total brands 111.0 103.4 7.3%
======================================
- ----------------------------------------------------------------------------------
</TABLE>
Worldwide beer volume is comprised of domestic and international volume.
Domestic volume represents Anheuser-Busch brands produced and shipped within
the United States. International volume represents exports from the company's
U.S. breweries to markets around the world, plus Anheuser-Busch brands
produced overseas by company-owned breweries in China and the United Kingdom
and under license and contract brewing agreements. Budweiser and other
Anheuser-Busch beer brands are sold in more than 80 countries worldwide.
Total volume combines worldwide Anheuser-Busch brand volume with the
company's pro rata share of volume in international equity partner Grupo
Modelo. Total brands also includes Anheuser-Busch's equity share of
Antarctica beer volume through July 1999. The company sold its equity
investment back to Antarctica in July 1999.
ANHEUSER-BUSCH COMPANIES 2000 ANNUAL REPORT 27
<PAGE>
<PAGE> 4
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
OPERATIONS AND FINANCIAL CONDITION
SALES -- 2000 VS. 1999
Anheuser-Busch achieved record gross sales of $14.3 billion and record
net sales of $12.3 billion in 2000. Gross sales increased vs. 1999 by $574
million, or 4.2%, and net sales increased $558 million, or 4.8%, compared to
1999. The primary factors responsible for these increases were increased
domestic revenue per barrel and higher domestic beer sales volume, partially
offset by lower international beer sales due primarily to the conversion of
the company's 90% owned Japan joint venture into an exclusive licensing
arrangement. The difference between gross and net sales in 2000 is beer
excise taxes of $2.03 billion.
Domestic revenue per barrel grew 2.5% for the year 2000 compared to 1999,
reflecting the company's continuing focus on beer profit margin growth. The
domestic beer industry environment continues to support price increases and
additional discount reductions. In October 2000, the company successfully
implemented the first stage of its planned revenue enhancement strategy for
2001 in markets representing 40% of its domestic volume. In February 2001,
the company implemented its second stage of price increases and discount
reductions on another 35% of the company's
[SALES* -- GRAPH]
[FN]
* THE DIFFERENCE BETWEEN GROSS SALES AND NET SALES
REPRESENTS BEER EXCISE TAXES.
</FN>
domestic volume. These revenue initiatives have again been tailored to
specific markets, brands and packages.
Domestic beer sales-to-wholesalers increased 2.7% for the year 2000, to
98.3 million barrels. Domestic volume growth was led by the Bud Family, with
Bud Light registering its ninth consecutive year of double-digit growth due
to strong underlying retail demand. Domestic sales-to-retailers were up 2.5%
for the year compared to 1999.
Anheuser-Busch believes its success in 2000 provides a solid foundation
for future growth, given the company's ability to capitalize on favorable
domestic industry fundamentals and the continued strong earnings growth by
the international beer segment. Profit margins were significantly enhanced
and return on capital employed increased 100 basis points in 2000. The
company remains confident in its ability to consistently achieve its
long-term double-digit earnings per share growth objectives, with an earnings
per share growth target of 12% for 2001.
Worldwide Anheuser-Busch beer sales volume grew to 105.6 million barrels,
up 2.6% for 2000 compared to 1999. Total volume was 121.3 million barrels, up
2.8% for the year. Normalized to exclude 1999 volume related to Anheuser-
Busch's previously held equity stake in Antarctica, equity partner volume
increased 6.2% for the year, and total volume increased 3.1%.
The company's reported domestic market share (excluding exports) for 2000
was 48.4%, an increase of 0.9 share points over 1999 market share of 47.5%.
Including exports, the company's share of U.S. shipments was 48.3% vs. 47.4%
for 1999. Domestic market share and share of U.S. shipments are determined
based on industry sales estimates provided by the Beer Institute, which have
not been adjusted for the impact of the wholesaler inventory reduction
initiated by Miller in the fourth quarter. The company has led the U.S.
brewing industry in sales volume and market share since 1957.
International beer volume (excluding Modelo) grew 1.3% in 2000, due
primarily to growth in Canada and China, partially offset by lower volume in
the United Kingdom.
SALES -- 1999 VS. 1998
Anheuser-Busch achieved gross sales of $13.7 billion and net sales of
$11.7 billion in 1999. Gross sales increased over 1998 by $515 million, or
3.9% and net sales increased over 1998 by $458 million, or 4.1%. The sales
increases are primarily due to higher domestic beer volume and higher revenue
per barrel. The difference between gross and net sales for 1999 is beer
excise taxes of $2.02 billion.
Domestic revenue per barrel grew nearly 3% in 1999 compared to 1998,
reflecting the company's focus on enhancing domestic beer profitability. In
the fourth quarter 1999, the company implemented price increases in 72% of
the country on selected brands and packages representing 43% of its volume.
Domestic beer shipments to wholesalers grew to 95.7 million barrels in
1999, an increase of 3.0 million barrels or 3.2% over 1998. Each of the
company's core brand families contributed to domestic volume growth. Bud
Light recorded its eighth consecutive year of double-digit growth. Overall,
wholesaler sales-to-retailers grew 3.3% for full year 1999.
28 ANHEUSER-BUSCH COMPANIES 2000 ANNUAL REPORT
<PAGE>
<PAGE> 5
Worldwide Anheuser-Busch beer brands shipments grew to 102.9 million
barrels for the year 1999, up 3.1% compared to 1998. This marked the first
time in brewing industry history a company has sold over 100 million barrels
of its beer in a single year. Total beer volume in 1999 was 118.0 million
barrels, up 6.3% over 1998.
The company's domestic market share (excluding exports) for 1999 was
47.5%, an increase of 0.7 share points over 1998 market share of 46.8%.
Including exports, the company's share of U.S. Shipments was 47.4% for the
year vs. 46.6% for 1998.
International beer volume (excluding Modelo) was up 1.2% for the year
1999 compared to 1998, to 7.2 million barrels. The increase was due primarily
to gains in the Americas, Ireland and Continental Europe, partially offset by
weakness in Asia, principally in Japan, and lower sales in the United
Kingdom.
In August 1999, the company recalled twist-off bottles in several
European countries as a quality assurance measure. The recall stemmed from
problems with the bottle manufacturing process. There were no quality issues
with the beer itself. The company incurred total pretax costs of
approximately $6 million in 1999 for the bottle recall.
In July 1999, Anheuser-Busch sold its equity interest in Antarctica back
to Antarctica. There was no impact on earnings associated with the
divestiture. In September 1999, Anheuser-Busch and Antarctica announced a
joint decision not to apply to CADE, Brazil's antitrust commission, for
continued production of Budweiser by Antarctica. Instead, the company entered
into a distribution agreement with Expand Group in December 1999 for the
exporting of Budweiser to Brazil beginning in January 2000. The pretax cost
of discontinuing Budweiser production in Brazil was approximately $6 million.
Effective January 1, 2000, the company converted its 90%-owned Japan
joint venture operation into an exclusive license agreement with its local
partner Kirin, for the production and selling of Budweiser in Japan. The new
agreement with Kirin is designed to create new opportunities for Budweiser's
growth and to improve profitability by giving the brand full access to
Kirin's national wholesaler distribution and integrated selling systems and
reducing the company's overhead costs in Japan. The cost of converting to the
license agreement was approximately $9 million and is included in 1999
results.
SALES -- 1998 VS. 1997
Anheuser-Busch achieved gross sales of $13.2 billion and net sales of
$11.2 billion in 1998. These results represent a gross sales increase over
1997 of $376 million, or 2.9%, and a net sales increase over 1997 of $180
million, or 1.6%. The increases were primarily due to higher domestic beer
volume. For 1998, sales and excise taxes include the impact of accounting for
the Stag Brewery operations in the United Kingdom on a consolidated basis vs.
equity accounting in 1997. Beer excise taxes for 1998 totaled $1.96 billion.
Worldwide volume for Anheuser-Busch beer brands was up 3.3% for 1998,
compared to the prior year. Total volume was up 7.6 million barrels, or 7.3%,
for the year. International equity partner brands reflects the company's 37%
ownership interest in Grupo Modelo brands for the first nine months of 1998
and 50.2% for the fourth quarter, compared to a combination of 17.7%
ownership interest for the first five months of 1997 and 37% thereafter.
Anheuser-Busch's strategy to reduce domestic price discounting initiated
at the beginning of 1998 was successful. This strategy was designed to
increase revenues, reduce the spread between front-line and discounted prices
to consumers, and protect the company's brand equities. In October 1998, the
company initiated a revenue enhancement strategy of selective price increases
and discount reductions. As a result of these and other actions, domestic
revenue per barrel was up nearly 3% in the fourth quarter 1998 compared to
the same period in 1997, and was level for the full year compared to full
year 1997.
Anheuser-Busch domestic beer shipments grew 3.5% during 1998, reflecting
strong retail demand. Overall, sales-to-retailers were up 4% for 1998.
Combined Bud and Bud Light sales-to-retailers increased 3.4% for 1998
compared to 1997. This growth was led by Bud Light, which had its seventh
consecutive double-digit growth year.
The company's domestic market share (excluding exports) for 1998 was
46.8%, an increase of 1.0 share points over 1997 market share of 45.8%.
Including exports, the company's share of U.S. Shipments was 46.6%, vs. 45.5%
for 1997.
International Anheuser-Busch brand volume (excluding Modelo) was up 0.6%
in 1998 compared to 1997. Strong Budweiser sales performances in the United
Kingdom, Ireland, Continental Europe and Canada were mostly offset by sales
declines in Asia.
In Japan, Anheuser-Busch performance was impacted by lower industry sales
due to an economic recession and the introduction of a tax-advantaged
"happoshu" beer category. Accordingly, Anheuser-Busch significantly
restructured its sales force. The restructuring resulted in a pretax charge
of $9 million in the fourth quarter 1998.
In June 1998, the company restructured its alliance granting Labatt
Brewing Company perpetual rights to brew and sell the Budweiser and Bud Light
brands in Canada. In return, Labatt significantly increased marketing support
behind the two brands and Anheuser-Busch received a higher royalty percentage
on Budweiser and Bud Light sales in Canada.
ANHEUSER-BUSCH COMPANIES 2000 ANNUAL REPORT 29
<PAGE>
<PAGE> 6
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
OPERATIONS AND FINANCIAL CONDITION
COST OF PRODUCTS AND SERVICES
The company continuously strives to drive costs out of its system.
Brewery modernizations have yielded long-term savings through reduced beer
packaging and shipping costs and reduced maintenance and equipment
replacement costs. The company's focused production methods and wholesaler
support centers concentrate small-volume brand and package production at
three breweries to create production efficiencies, reduce costs and enhance
responsiveness to changing consumer brand/package preferences. Also, the
company works with its network of wholesalers to reduce distribution costs
through better systemwide coordination.
Cost of products and services was $7.59 billion for 2000, an increase of
$338 million, or 4.7%, compared to 1999. The increase in cost of products and
services is principally due to higher domestic beer volume and increased
costs at the company's entertainment, can manufacturing and commodity
aluminum recycling businesses. Gross profit as a percentage of net sales was
38.1% for 2000, an increase of 10 basis points compared to 1999, primarily
reflecting increased domestic revenue per barrel, partially offset by lower
packaging segment gross profit.
Cost of products and services was $7.25 billion in 1999, an increase of
$92 million, or 1.3%, vs. 1998. The increase in the cost of products and
services in 1999 is primarily due to higher domestic beer volume and higher
costs at the company's packaging operations. Gross profit as a percentage of
net sales for 1999 was 38.0%, an increase of 170 basis points vs. 1998.
Cost of products and services was $7.16 billion in 1998, an increase of
$66 million, or 0.9%, compared to 1997. The change in the cost of products
and services in 1998 is primarily due to increased beer volume, the change
in the method of accounting for the Stag Brewery operation (consolidation in
1998 vs. Equity accounting in 1997) and improved brewery operating
efficiencies. In 1998, under full consolidation accounting for Stag, excise
taxes are shown as a deduction from gross sales, while under the equity
method in 1997, excise taxes were included in the cost of beer purchased
from Stag.
Gross profit as a percentage of net sales was 36.3% for 1998, an increase
of 40 basis points vs. 1997, primarily reflecting productivity improvements.
MARKETING, DISTRIBUTION AND ADMINISTRATIVE EXPENSES
Marketing, distribution and administrative expenses for 2000 were $2.17
billion, an increase of $28 million, or 1.3% vs. 1999. The increase in these
expenses in 2000 is due to higher marketing expenses for the domestic beer
segment, higher one-time marketing costs for the entertainment segment
related to the opening of the Discovery Cove park and higher general and
administrative costs, partially offset by lower international beer marketing
expenses in Japan due to the conversion of the company's joint venture.
Marketing, distribution and administrative expenses for 1999 were $2.15
billion compared with $1.96 billion for 1998, an increase of $189 million, or
9.7%. The increase is primarily attributable to higher domestic marketing and
sales promotion spending in support of the Bud Family, increased spending on
consumer awareness and education programs and higher general and
administrative costs.
Marketing, distribution and administrative expenses for 1998 increased
$42 million, or 2.2%, compared to 1997 expenses of $1.92 billion. The
increase is primarily due to higher domestic and international marketing
expense in support of premium brands, primarily the Bud Family.
OPERATING INCOME
Operating income represents the measure of the company's financial
performance before net interest cost, other nonoperating items and equity
income.
Operating income in 2000 grew $192.4 million, or 8.4% compared to 1999,
primarily due to the domestic beer company's strong revenue per barrel and
volume performance as well as good results from international beer
operations.
The international beer segment's net income in 2000 increased 51.7%
compared to 1999, due to the strong performance by Grupo Modelo and improved
international operating results. International beer operating profits in
2000, excluding Modelo, improved compared to 1999 on volume gains in China
and lower costs in Japan due to the conversion of the company's joint venture
into an exclusive licensing agreement.
[OPERATING INCOME -- GRAPH]
[FN]
* NORMALIZED RESULTS, EXCLUDING ONE-
TIME GAIN FROM THE SALE OF THE ST. LOUIS
CARDINALS. REPORTED OPERATING INCOME
FOR 1996, WHICH INCLUDES THE GAIN ON
THE CARDINALS SALE, WAS $2,083.8.
</FN>
30 ANHEUSER-BUSCH COMPANIES 2000 ANNUAL REPORT
<PAGE>
<PAGE> 7
Packaging segment operating profits were down $62 million, or 41.4% for
2000 compared to 1999, reflecting lower conversion pricing on Metal
Container's beer and soft drink can sales and a $14 million adjustment
related to prior year accounting errors at the company's label manufacturing
business in Clarksville, Tennessee. Entertainment segment operating results,
excluding start-up costs associated with Discovery Cove, were up 7.6% for the
year due primarily to strong attendance in the Florida market. Discovery Cove
successfully began operations in July 2000.
Operating income for 1999 was $2.30 billion, an increase of $177 million,
or 8.3%, compared to 1998. The increase in operating income for the year is
primarily due to strong domestic beer performance driven by higher domestic
beer sales volume and revenue per barrel.
Theme park operating results for 1999 were up slightly from the prior
year, excluding start-up costs for the Discovery Cove park.
Performance of the company's packaging operations in 1999 was level with
1998.
Net income for Anheuser-Busch's international beer segment was up 59% in
1999 due to Modelo's strong performance and Anheuser-Busch's increased
ownership level in Modelo due to the purchase of an additional 13.25% equity
interest in September 1998. However, international beer operating results,
which exclude Modelo, declined for the year to a loss of $19.5 million,
including one-time costs associated with the termination of the Budweiser
production joint venture in Brazil, the impact of a bottle recall in Europe
and the conversion of the company's Japan joint venture operation into an
exclusive license agreement.
Operating income for 1998 was $2.13 billion, an increase of $72 million,
or 3.5%, over 1997. The increase in operating income for 1998 was primarily
due to higher domestic beer sales volume and higher operating results from
can manufacturing and entertainment, partially offset by weaker results from
international beer operations.
Packaging operating income improved in 1998 vs. 1997, due to higher soft
drink can volume and reduced costs.
Despite weakness in Florida tourism, entertainment operations had a
slight improvement in operating income compared to 1997, due to higher
in-park spending.
International beer operating income declined vs. 1997 primarily due to
weakness in Japan.
NET INTEREST COST
Net interest cost (interest expense less interest income) was $347.1
million for 2000, $303.5 million for 1999 and $285.7 million for 1998,
representing increases of 14.4%, 6.2% and 12.8%, respectively, compared to
prior years. These increases primarily result from higher average outstanding
debt balances compared to prior years, with a lesser impact from higher
average interest rates. See the Liquidity and Cash Flows section of this
discussion for additional information.
INTEREST CAPITALIZED
Interest capitalized increased $15.1 million, to $33.3 million in 2000
compared to 1999. Interest capitalized decreased $7.8 million, to $18.2
million for 1999 compared to 1998, and declined $16.1 million in 1998, to
$26.0 million compared to 1997. The changes in capitalized interest amounts
fluctuate depending on construction-in-progress balances, which are impacted
by the timing of capital spending and project completion dates.
OTHER INCOME/EXPENSE, NET
Other income/expense, net includes numerous items of a nonoperating
nature that do not have a material impact on the company's consolidated
results of operations, either individually or in total. The company had net
other expense of $1.0 million in 2000, $9.4 million in 1999 and $13.0 million
in 1998.
ANHEUSER-BUSCH COMPANIES 2000 ANNUAL REPORT 31
<PAGE>
<PAGE> 8
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
OPERATIONS AND FINANCIAL CONDITION
EQUITY INCOME, NET
Equity income, net of tax, increased 27%, to $200 million for 2000
compared to 1999, based on Grupo Modelo's strong underlying pricing and
volume performance.
Equity income for 1999 increased $72.5 million compared to 1998, to
$157.5, due to Modelo's underlying performance and Anheuser-Busch's increased
ownership level in Modelo. The company held a 50.2% equity stake in Modelo
throughout 1999. This compares to 37% ownership for the first nine months and
50.2% for the last quarter 1998. Additionally, equity income for 1998 was
adversely impacted by Mexican peso depreciation and hyperinflation
accounting. Hyperinflation accounting ceased January 1, 1999.
The company recognized equity income, net of tax, of $85.0 million during
1998, compared to $50.3 million in 1997. The increase in equity income in
1998 was due to a larger equity share in Modelo and the strong underlying
sales volume and operating results for Modelo, partially offset by the impact
of hyperinflation accounting. For 1998, equity income percentages compare
with 17.7% ownership for the first five months of 1997 and a 37% ownership
interest thereafter.
NET INCOME
The company earned net income of $1.55 billion in 2000, an increase of
$149.4 million, or 10.7%, vs. 1999 net income of $1.40 billion. Net income
for 1999 increased $169 million, or 13.7%, vs. the 1998 total of $1.23
billion, an increase of $54 million, or 4.6%, compared to 1997.
The company's effective tax rate was 38.0% in 2000, 1999 and 1998. The
1998 effective rate declined 0.4% vs. 1997, principally due to lower state
and foreign taxes and lower nondeductible costs.
DILUTED EARNINGS PER SHARE
Diluted earnings per share were $1.69 for 2000, an increase of 15.0% vs.
1999 diluted earnings per share. Diluted earnings per share for 1999 were
$1.47, an increase of $.20, or 16.2%, compared to 1998 diluted earnings per
share of $1.27, which had increased 7.2% compared to 1997. Diluted earnings
per share benefit from the company's ongoing share repurchase program. The
company repurchased 28.2 million, 37.8 million and 27.8 million common shares
in 2000, 1999 and 1998, respectively.
See Note 7 for additional information regarding share repurchases.
[DILUTED EARNINGS PER SHARE -- GRAPH]
[FN]
* NORMALIZED RESULTS, EXCLUDING ONE-
TIME GAIN FROM THE SALE OF THE ST.
LOUIS CARDINALS. REPORTED DILUTED
EARNINGS PER SHARE FOR 1996, WHICH
INCLUDE THE GAIN ON THE CARDINALS
SALE, WERE $1.14.
1 BEFORE CUMULATIVE EFFECT OF
ACCOUNTING CHANGE.
</FN>
32 ANHEUSER-BUSCH COMPANIES 2000 ANNUAL REPORT
<PAGE>
<PAGE> 9
EMPLOYEE-RELATED COSTS
Employee-related costs totaled $1.92 billion in 2000, an increase of $38
million, or 2.0%, vs. 1999 costs of $1.88 billion. Employee-related costs for
1999 increased $40 million, or 2.2%, vs. 1998 costs of $1.84 billion, which
increased 2.6% vs. 1997. The changes in employee-related costs reflect normal
increases in salaries, wages and benefit levels.
[EMPLOYEE-RELATED COSTS -- GRAPH]
Salaries and wages comprise the majority of employee-related costs and
totaled $1.58 billion in 2000, an increase of $40 million, or 2.6% vs. 1999.
Salaries and wages totaled $1.54 billion in 1999, an increase of $22 million,
or 1.4%, compared to $1.52 billion in 1998. Salaries and wages for 1998
increased 2.7% vs. 1997. The remainder of employee-related costs consists of
pension, life insurance, and health care benefits and payroll taxes.
Full-time employees numbered 23,725, 23,645 and 24,344 at December 31,
2000, 1999 and 1998, respectively.
TAXES
The company is significantly impacted by federal, state and local taxes,
including beer excise taxes. Taxes applicable to 2000 operations (not
including the many indirect taxes included in materials and services
purchased) totaled $3.1 billion, an increase of $81.4 million, or 2.7%, vs.
1999 total taxes of $3.0 billion, and highlight the burden of taxation on the
company and the brewing industry in general. Taxes in 1999 increased 3.9%
compared to 1998 total taxes of $2.89 billion, which increased 8.1% compared
to 1997.
The increases in taxes in 2000, 1999 and 1998 are primarily due to higher
income taxes and beer excise taxes. Taxes for 1998 also reflect consolidation
accounting of Stag operations compared to equity accounting in 1997.
LIQUIDITY AND CAPITAL RESOURCES
The company's primary sources of liquidity are cash provided from
operations and financing activities. Principal uses of cash are capital
expenditures, business investments, share repurchases and dividends.
Information on the company's consolidated cash flows (categorized by
operating activities, financing activities and investing activities) for the
years 2000, 1999 and 1998 is presented in the Consolidated Statement of Cash
Flows and Note 11.
OPERATING CASH FLOW
Anheuser-Busch's strong financial profile allows it to pursue its growth
strategies while providing substantial direct returns to shareholders.
Accordingly, the company has established well-defined priorities for its
operating cash flow:
* Reinvest in core businesses to achieve profitable growth. To enhance
shareholder value, the company will continue to make investments to
improve efficiency and capacity in its existing operations, and make
selected equity investments in international brewers in higher growth
markets.
* Make substantial cash payments directly to shareholders through
consistent dividend growth and the repurchase of common shares.
The company has paid cash dividends each of the last 67 years, and
has repurchased approximately 3% of outstanding shares annually for
the last 10 years.
At December 31, 2000, the company had a working capital deficit of
$(127.8), compared to working capital deficits of $(350.4) million at
December 31, 1999 and $(89.9) million at December 31, 1998. The company
typically operates at a working capital deficit.
[OPERATING CASH FLOW -- GRAPH]
ANHEUSER-BUSCH COMPANIES 2000 ANNUAL REPORT 33
<PAGE>
<PAGE> 10
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
OPERATIONS AND FINANCIAL CONDITION
CAPITAL EXPENDITURES
During the next five years, the company will continue capital expenditure
programs designed to take advantage of growth and productivity improvement
opportunities for its beer, packaging and entertainment operations. The
company has a formal and intensive review procedure for the authorization of
capital expenditures. The most important measure of acceptability of a
capital project is its projected discounted cash flow return on investment
exceeding the company's cost of capital.
[CAPITAL EXPENDITURES/DEPRECIATION & AMORTIZATION -- GRAPH]
Cash flow from operating activities is projected to exceed the company's
funding requirements for anticipated capital expenditures. However, the
combination of capital spending, dividend payments and share repurchases,
plus possible additional investments in international brewers, may require
external financing. The nature, extent and timing of external financing will
vary depending upon the company's evaluation of existing market conditions
and other economic factors.
Total capital expenditures in 2000 amounted to $1.1 billion, an increase
of $209 million, or 24.2%, compared to 1999 capital spending of $865 million.
Capital expenditures over the past five years totaled $5.0 billion. The
company expects capital expenditures in 2001 of approximately $950 million
and anticipates capital expenditures during the five-year period 2001 - 2005
of approximately $4.5 billion.
SHARE REPURCHASE
See Note 7 for a discussion of share repurchase activity.
DIVIDENDS
Cash dividends paid to common shareholders were $571.0 million in 2000
and $544.7 million in 1999. Dividends on common stock are paid in the months
of March, June, September and December of each year. In the third quarter
2000, effective with the September dividend, the Board of Directors increased
the quarterly dividend rate by 10%, from $.15 to $.165 per share of common
stock. This increased annual dividends per common share 8.6%, to $.63 in
2000, compared with $.58 per common share in 1999. In 1999 dividends were
$.14 per share for the first two quarters and $.15 per share for the last
two quarters.
[NET INCOME/DIVIDENDS -- GRAPH]
[FN]
* NORMALIZED RESULTS, EXCLUDING ONE-TIME GAIN FROM THE
SALE OF THE ST. LOUIS CARDINALS. REPORTED NET INCOME
FOR 1996, WHICH INCLUDES THE GAIN ON THE CARDINALS
SALE, WAS $1,156.1.
1 BEFORE CUMULATIVE EFFECT OF ACCOUNTING CHANGE.
</FN>
34 ANHEUSER-BUSCH COMPANIES 2000 ANNUAL REPORT
<PAGE>
<PAGE> 11
FINANCING ACTIVITIES
The company utilizes Securities and Exchange Commission "shelf"
registration statements to provide flexibility and efficiency when obtaining
long-term financing. At December 31, 2000, a total of $600 million of debt
was available for issuance under existing registrations.
Total debt increased a net $251.6 million in 2000, compared to an
increase of $404.3 million in 1999. The change in debt during these years is
detailed below, by key component.
INCREASES IN DEBT -- $803.9 million in 2000 and $994.7 million in 1999, as
follows:
<TABLE>
<CAPTION>
YEAR DESCRIPTION AMOUNT INTEREST RATE
(MILLIONS)
<S> <C> <C> <C>
2000 DEBENTURES $400.0 $200.0 EACH AT 6.8%
AND 7.55%, FIXED
LONG-TERM NOTES $400.0 $200.0 EACH AT 6.5%
AND 7.5%, FIXED
INDUSTRIAL REVENUE
BONDS $3.9 VARIOUS FIXED RATES
- ------------------------------------------------------------------------------
1999 Long-term notes $300.0 5.75%, fixed
Commercial paper $627.1 5.1%, weighted average
floating
Industrial revenue
bonds $36.1 Various fixed rates
Miscellaneous $31.5 Various fixed rates
- ------------------------------------------------------------------------------
</TABLE>
DECREASES IN DEBT -- $552.3 million in 2000 and $590.4 million in 1999,
as follows:
<TABLE>
<CAPTION>
YEAR DESCRIPTION AMOUNT INTEREST RATE
(MILLIONS)
<S> <C> <C> <C>
2000 COMMERCIAL PAPER $475.1 6.2%, WEIGHTED
AVERAGE FLOATING
ESOP DEBT
GUARANTEE $38.3 8.25%, FIXED
MEDIUM-TERM NOTES $25.0 6.75%, WEIGHTED
AVERAGE FIXED
MISCELLANEOUS $13.9 VARIOUS FIXED RATES
- ------------------------------------------------------------------------------
1999 Dual currency notes $262.4 Quarterly floating rate
Long-term notes $250.0 8.75%, fixed
Debentures $23.0 8.5%, fixed
Medium-term notes $15.0 7.7%, weighted average
fixed
ESOP debt guarantee $36.7 8.25%, fixed
Miscellaneous $3.3 Various fixed rates
- ------------------------------------------------------------------------------
</TABLE>
In addition to long-term debt financing, the company has access to the
short-term capital market through the utilization of commercial paper and its
$2 billion revolving bank credit agreement that expires June 2005. The credit
agreement provides the company with an immediate and continuing source of
liquidity. No borrowings have been made under the credit agreement since its
inception. Also see Note 4.
The company's cash flow to total debt ratio was 41.5% in 2000, 41.8% in
1999 and 41.9% in 1998. The ratio of debt to total capitalization was 56.6%
at both December 31, 2000 and 1999. The company's fixed charge coverage ratio
was 6.7X, 6.9X, and 6.8X for the years ended December 31, 2000, 1999 and
1998, respectively.
Historically, Anheuser-Busch, Inc. (ABI), the company's domestic beer
subsidiary, has been co-obligor on substantially all of the company's senior
debt. The co-obligation was originated in connection with the formation of
the company as a holding company in 1979, in order to assure that the senior
debt issued by the company would not be structurally subordinated to the debt
issued by ABI prior to the formation of the holding company. The debt issued
by ABI has been retired, making the ABI co-obligations unnecessary.
Therefore, effective December 31, 2000, ABI's co-obligations were terminated.
Removal of the guarantees had no impact on the company's credit ratings or
cost of borrowing.
[SHAREHOLDERS EQUITY/DEBT -- GRAPH]
ANHEUSER-BUSCH COMPANIES 2000 ANNUAL REPORT 35
<PAGE>
<PAGE> 12
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
OPERATIONS AND FINANCIAL CONDITION
COMMON STOCK
At December 31, 2000, registered common shareholders numbered
58,614 compared with 60,100 at the end of 1999. See Note 7 for a
summary of common stock activity.
PRICE RANGE OF COMMON STOCK
The company's common stock is listed on the New York Stock Exchange under
the symbol "BUD." The following table summarizes 2000 and 1999 quarterly high
and low closing prices for BUD.
<TABLE>
- ------------------------------------------------------------------------------
PRICE RANGE OF ANHEUSER-BUSCH COMMON STOCK (BUD)
- ------------------------------------------------------------------------------
<CAPTION>
2000 1999
QUARTER HIGH LOW HIGH LOW
<S> <C> <C> <C> <C>
First 38.06 27.47 39.22 32.59
Second 40.66 32.69 39.44 34.47
Third 44.31 38.13 40.81 34.84
Fourth 49.81 39.63 38.19 33.34
- ------------------------------------------------------------------------------
</TABLE>
The closing price of the company's common stock at December 31, 2000 and
1999 was $45.50 and $35.44, respectively. The book value of each common share
of stock at December 31, 2000 was $4.57, compared to $4.25 at December 31,
1999.
SYSTEMS-RELATED YEAR 2000 COSTS
The company experienced no operating interruptions or other disturbances
due to Year 2000 events. The company resolved its Year 2000 date recognition
issues through either the replacement of existing systems with Year
2000-ready-systems or by reprogramming existing systems.
RISK MANAGEMENT
Anheuser-Busch is exposed to foreign currency exchange, interest rate and
commodity price risks. These exposures primarily relate to beer sales to
foreign customers, purchases from foreign suppliers, royalty receipts from
foreign license and contract brewers, acquisition of raw materials from both
domestic and foreign suppliers, and changes in interest rates. The company
utilizes derivative financial instruments, including forward exchange
contracts, futures contracts, swaps and options to manage certain of these
exposures. Anheuser-Busch has well-established policies and procedures
governing the use of derivatives. The company hedges only firm commitments or
anticipated transactions in the ordinary course of business and corporate
policy prohibits the use of derivatives for speculation, including the sale
of free-standing instruments. The company neither holds nor issues financial
instruments for trading purposes.
Specific hedging strategies depend on several factors, including the
magnitude and volatility of the exposure, cost of the hedge and availability
of appropriate hedging instruments, the anticipated time horizon, commodity
basis, opportunity cost and the nature of the item being hedged. The
company's overall risk management goal is to strike a balance between
managing its exposure to market volatility and obtaining the most favorable
transaction costs possible.
Derivatives are either exchange-traded instruments which are highly
liquid, or over-the-counter instruments transacted with highly rated
financial institutions. No credit loss is anticipated as the counterparties
to over-the-counter instruments generally have long-term ratings from
Standard & Poor's or Moody's no lower than A+ or A1, respectively.
Additionally, counterparty fair value positions favorable to Anheuser-Busch
and in excess of certain thresholds are collateralized with cash, U.S.
Treasury securities or letters of credit. Anheuser-Busch has reciprocal
collateralization responsibilities for fair value positions unfavorable to
the company and in excess of certain thresholds. At December 31, 2000, the
company held zero counterparty collateral and had none outstanding.
The fair value of derivative financial instruments is the estimated
amount the company would receive or have to pay when terminating any
contracts. The company also monitors the effectiveness of its hedging
structures, based either on cash offset between changes in the value of the
underlying hedged exposu