THE MUSICLAND GROUP, INC.
AND
MUSICLAND STORES CORPORATION
AND
BANK ONE, NA, f/k/a Bank One, Columbus, NA, Trustee
(Successor to XXXXXX TRUST AND SAVINGS BANK)
First Supplemental Indenture
Dated as of June 13 , 1997
9% SENIOR SUBORDINATED NOTES DUE 2003
Execution copy -6/12/97
THIS FIRST SUPPLEMENTAL INDENTURE, dated as of June , 1997, among THE
MUSICLAND GROUP, INC., a Delaware corporation (the "Issuer"), MUSICLAND STORES
CORPORATION, a Delaware corporation (the "Guarantor"), and BANK ONE, NA,
formerly known as Bank One, Columbus, NA, a national banking association (the
"Trustee") as successor to XXXXXX TRUST AND SAVINGS BANK (the "Original
Trustee").
WITNESSETH:
WHEREAS, the Issuer, the Guarantor and the original Trustee have
executed and delivered the Indenture dated as of June 17, 1993, (the
"Indenture");
WHEREAS, capitalized terms used herein without definition have the
respective meanings specified in the Indenture;
WHEREAS, the Issuer and the Guarantor desire to amend the Indenture
in the particulars set forth herein;
WHEREAS, Section 7.2 of the Indenture provides that the Issuer and the
Guarantor, when authorized by board resolutions of the Issuer and Guarantor,
respectively, and the Trustee may enter into supplemental indentures with the
consent of the Holders of not less than a majority in aggregate principal amount
of the Securities at the time Outstanding by act of said Holders delivered to
the Trustee;
WHEREAS, consent to this First Supplemental Indenture from the Holders
of not less than a majority in aggregate principal amount of the Securities as
of May 30, 1997 has been obtained pursuant to Article Six of the Indenture;
AND WHEREAS, all things necessary to make this First Supplemental
Indenture a valid agreement of the Issuer and Guarantor in accordance with its
terms have been done;
(1)
Execution copy -6/12/97
NOW THEREFORE:
For and in consideration of the premises, it is mutually covenanted and
agreed for the equal and proportionate benefit of all Holders of the Securities
as follows:
1. The definition of "Credit Agreement" contained in Section 1.1
of the Indenture is amended by adding to the end thereof the following:
"Without in any manner amending or limiting the generality of the
foregoing definition, it is specifically intended by the parties hereto that the
term "Credit Agreement" includes the revolving Credit Agreement dated as of
October 7, 1994, as heretofore and hereafter amended, among the Issuer, the
Guarantor, Xxxxxx Guaranty Trust Company of New York, as Agent and the other
lenders party thereto from time to time (the "Revolving Credit Agreement"), and
the Term Loan Agreement to be dated as of June , 1997, as hereafter amended,
among the Issuer, the Guarantor, Xxxxxx Guaranty Trust Company of New York, as
Agent and the other lenders party thereto from time to time (the "Term Loan
Agreement")."
2. Clause (xviii) of the definition of "Permitted Liens"
contained in Section 1.1 of the Indenture is amended to read in its entirety
as follows:
"(xviii) Liens on Capital Stock of Subsidiaries granted pursuant to the Credit
Agreement and other Liens granted pursuant to the Credit Agreement to secure
Debt consisting only of (A) advances under the Term Loan Agreement not exceeding
an aggregate principal amount of $50,000,000, (B) outstanding credit extensions
under the Revolving Credit Agreement in an aggregate principal amount not
exceeding $30,000,000 but only until the commitments under the Revolving Credit
Agreement are first reduced to $245,000,000 and (C) an additional amount not in
excess of $20,000,000 for accrued interest, collection costs and other fees at
any time outstanding under the Term Loan Agreement;"
(2)
Execution copy -6/12/97
3. Section 3.8(a) of the Indenture is amended by deleting the word
"and" before clause (ix) and adding to the end thereof the following:
"and (x) Debt Incurred as the result of any reclassification pursuant
to GAAP of any lease which was in existence and classified as an operating lease
on or at any time prior to December 31, 1996 and Debt Incurred to purchase
leased assets under such operating leases but only to the extent in each such
instance that the Debt Incurred is not greater than the Issuer's original
liability under the operating lease"
4. Section 4.1(f) of the Indenture is amended by adding in each case
after the word "Debt" in the first, third and fifth lines thereof the following:
", other than Debt Incurred as the result of any
reclassification pursuant to GAAP of any operating lease or Debt Incurred to
purchase leased assets but only to the extent in each such instance that the
Debt Incurred is not greater than the Issuer's original liability under the
operating lease,"
5. The Indenture, supplemented as herein above set forth, is in all
respects ratified and confirmed, and the terms and conditions of the Indenture,
supplemented as herein above set forth, and the Securities and Note Guarantee
outstanding thereunder, shall be and remain in full force and effect.
6. This First Supplemental Indenture shall be governed by, and construed in
accordance with, the laws of the State of New York.
7. This First Supplemental Indenture may be executed simultaneously in
two or more counterparts, each of which shall be deemed an original but all of
which together shall constitute one and the same instrument.
(3)
Execution copy -6/12/97
IN WITNESS WHEREOF, the parties hereto have caused this First
Supplemental Indenture to be duly executed, and where appropriate, the
irrespective corporate seals to be hereunto affixed and attested, as of the day
and year first written above.
THE MUSICLAND GROUP, INC.
(CORPORATE SEAL)
By
-----------------------
Xxxx X. Xxxxxxx
Title: Chairman and CEO
ATTEST:
By
------------------------
Title: Asst. Secretary
MUSICLAND STORES CORPORATION
(CORPORATE SEAL)
By
-------------------------
Xxxx X. Xxxxxxx
Title: Chairman and CEO
ATTEST:
By
------------------------
Title: Asst. Secretary
BANK ONE, NA.
Trustee
(CORPORATE SEAL)
By
Title: Authorized Signatory
ATTEST:
By
------------------------
Title: Authorized Signatory
(4)
Execution copy -6/12/97
