U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
GENERAL SIGNAL CORPORATION
1993 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, 1993
or
( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Commission File No. 1-996
General Signal Corporation
Box 10010,
High Ridge Park, Stamford, Connecticut 06904
Telephone Number (203) 357-8800
IRS Employer Identification No. 16-0445660
State of Incorporation: New York
Securities registered pursuant to Section 12(b) of the Act:
Name of each exchange
Title of each class on which registered
Common Stock par value $1.00 New York Stock Exchange
(Par value reduced from $6.67 Pacific Stock Exchange
effective April 21, 1969)
5.75% Convertible Subordinated New York Stock Exchange
Debentures due June 1, 2002
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.
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
The aggregate market value of voting stock held by non-affiliates as
of March 7, 1994 was approximately $1.714 billion. As of March 7, 1994,
there were 47,434,958 shares of General Signal Corporation common stock
outstanding.
Documents incorporated by reference Part
Annual Report to Shareholders for the
Fiscal Year Ended December 31, 1993 I, II, IV
Proxy Statement for 1994 Annual Meeting III
Note: Some of this information required in this Form 10-K report
(10-K)was presented in the General Signal Corporation 1993 Annual
Report to Shareholders (Shareholders' Report) and is incorporated
herein by reference. A complete copy of the Shareholders' Report
is bound on the outside of this 10-K to facilitate reference.
Except for those sections specifically referred to as being
incorporated herein by reference, the Shareholders' Report shall
not be deemed to be "filed" as part of this 10-K. The registrant
is also referred to as "the company."
ITEM TABLE OF CONTENTS PAGE
1. Business . . . . . . . . . . . . . . . . . . . . . . 2
2. Properties . . . . . . . . . . . . . . . . . . . . . 4
3. Legal Proceedings . . . . . . . . . . . . . . . . . 4
4. Submission of Matters to a Vote of Security Holders 4
5. Market for the Registrant's Common Stock and
Related Shareholder Matters . . . . . . . . . . . . . 4
6. Selected Financial Data . . . . . . . . . . . . . . . 4
7. Management's Discussion and Analysis of Financial
Condition and Results of Operations . . . . . . . . . 4
8. Financial Statements and Supplementary Data . . . . . 4
9. Changes in and Disagreements With Accountants on
Accounting and Financial Disclosure . . . . . . . . . 4
10. Directors and Executive Officers . . . . . . . . . . 4
11. Executive Compensation . . . . . . . . . . . . . . . 4
12. Security Ownership of Certain Beneficial Owners
And Management . . . . . . . . . . . . . . . . . . . 4
13. Certain Relationships and Related Transactions . . . 4
14. Exhibits, Financial Statements,
Schedules and Reports on Form 8-K . . . . . . . . . . 5
PART I
ITEM 1. Business
General Developments
General Signal Corporation, incorporated in New York in 1904,
produces instrumentation and controls and related systems and
equipment for industrial automation, management of electrical energy,
telecommunications transmission, transportation, and test and
measurement equipment. The company serves these markets through three
product sectors: Process Controls, Electrical Controls and
Industrial Technology.
During 1993, the company issued 4.1 million additional shares of
common stock, completed a two-for-one split of common stock, acquired
Revco Scientific, Inc. by issuing 2.6 million shares of common stock
and completed the divestiture of substantially all of the
semiconductor equipment operations.
During the last five years, the company expended approximately $224
million in cash and common stock (2.6 million shares) to acquire 20
businesses and/or product lines. The notes to the financial
statements on pages 29 and 30 of the Shareholders' Report provide
additional information for acquisitions during the last three years
and is incorporated herein by reference.
Financial Information about Business Segments
Selected business segment information for the last five fiscal years
is summarized on page 31 of the Shareholders' Report and is
incorporated herein by reference. In addition to the information
disclosed with respect to business segments, the Securities and
Exchange Commission requires the disclosure of any class of similar
products or services that exceeds 10 percent of consolidated sales.
During 1992 and 1991, sales of the company's semiconductor equipment
group (including sales of units held for disposition) were
approximately $135.0 million or 8 percent and $180.2 million or 11
percent of consolidated sales, respectively.
A summary of information by geographic area for the last five fiscal
years is included on page 32 of the Shareholders' Report and is
incorporated herein by reference.
Narrative Description of Business
Major Markets and Products and Method of Distribution
A narrative description of the registrant's business is included on
pages 4 through 13 of the Shareholders' Report and is incorporated
herein by reference.
The company's products are sold by its own sales organization and
through distributors and manufacturers' representatives.
Materials and Supplies
The company manufactures many of the components used in its products
but it also purchases a variety of basic materials and component
parts. Although some basic materials and components have been and may
be in short supply from time to time, the company believes that
generally it will be able to obtain adequate supplies of major items
or reasonable substitutes.
Patents
The company holds many patents and has continued to secure other
patents that cover many of its products. While patents are important
in the aggregate to the company's competitive position, the loss of
any single patent, patent application or patent license agreement,
or group thereof, would not materially affect the conduct of its
business as a whole. The company is both a licensor and licensee of
patents, and overall, recognizes more income than expense from such
arrangements.
Working Capital
A discussion of working capital is included on pages 16 and 17 of the
Shareholders' Report and is incorporated herein by reference.
Backlog
The amount of unfilled orders was approximately $380.5 million in
1993 and $407.5 million in 1992 (excluding unfilled orders of
businesses sold or discontinued). All unfilled orders are expected
to be filled within the next succeeding year.
Competition
Although the businesses of the company are highly competitive, the
competitive position cannot be determined accurately in the aggregate
since none of its competitors offer all of the same product lines or
serve all of the same markets, nor are reliable comparative figures
available for its competitors. Competition for computer-directed
control systems comes primarily from a relatively small number of
large and well established concerns. In the other product groups,
competition comes from numerous concerns, both large and small. The
principal methods of competition are price, service, product
performance and technical innovation. These methods vary with the
type of product sold. The company believes that it can compete
effectively on the basis of each of these factors as they apply to
the various products offered.
Research and Development
Research and development expenditures for the last three years are
included on page 33 of the Shareholders' Report and are incorporated
herein by reference.
Environmental Matters
The company is involved in various stages of investigation and
remediation relative to environmental protection matters, arising
from its own initiative, from indemnification of purchasers of
divested operations, or from legal or administrative proceedings,
some of which include waste disposal sites. In certain instances, the
company may be exposed to joint and several liability for remedial
action or damages. The company, along with several other entities,
has been named as a Potentially Responsible Party for remedial costs
at certain third-party sites listed on the National Priorities List
under CERCLA.
The potential costs related to such matters and the possible impact
on future operations are uncertain due in part to the complexity of
government laws and regulations and their interpretations, the
varying costs and effectiveness of cleanup technologies, the
uncertain level of insurance or other types of recovery, and the
questionable level of the company's responsibility. In management's
opinion, after considering reserves established for such purposes,
remedial actions for compliance with the present laws and regulations
governing the protection of the environment are not expected to have
a material adverse impact on the company's results of operations or
financial position.
Employees
At December 31, 1993, the company had approximately 12,900 employees,
excluding employees of businesses held for sale. Approximately 3,600
employees are represented by 23 different collective bargaining
units. The company has generally experienced satisfactory labor
relations at its various locations.
Executive Officers of the Registrant
Name, Position, and Other Information Age
Edmund M. Carpenter, Chairman and Chief Executive Officer 53
since May 1, 1988. Previously, Director, President and Chief
Operating Officer of ITT Corporation since 1985. Prior to
joining ITT Corporation in 1981, President of Kelsey-Hayes
Company, a subsidiary of Fruehauf Corporation.
Joel S. Friedman, Senior Vice President - Operations since 57
March 1, 1987. Previously, Group Executive and President of
Lightnin, a unit of General Signal, since 1984 and President
of O-Z/Gedney, a unit of General Signal, since 1975.
Peter A. Laing, Senior Vice President - Operations since 54
March 1, 1987. Previously, Group Executive and President of
the Edwards Company, a unit of General Signal, since 1984,
President of the Edwards Company since 1978, and Vice
President - Finance of General Railway Signal, since 1974.
Stephen W. Nagy, Senior Vice President - Finance and Chief 54
Financial Officer since October 1, 1989. Previously, Vice
President - Finance and Chief Financial Officer of Trinova
Corporation since 1983.
George Falconer, Vice President - Human Resources since 62
October 23, 1986. Previously, Director of Human Resources
since 1981, Director of Industrial Relations since 1977,
and Corporate Director of Personnel Relations since 1976.
Associated with Metal Forge, a unit of General Signal,
since 1970, most recently as Vice President - Employee
Relations.
Nino J. Fernandez, Vice President - Investor Relations 53
since May 1, 1987. Previously, Director of Communications
since 1974.
Philip A. Goodrich, Vice President - Corporate Development 38
since December 12, 1991. Previously, Director of Corporate
Development since May, 1989 and Assistant Treasurer since May,
1987. Prior to joining the company, associated with Joseph E.
Seagram & Sons, Inc. since 1981 most recently as Assistant
Treasurer.
Darryl A. Littleton, Vice President - Manufacturing since 45
February 5, 1992. Previously, Senior Partner and Director of
Ingersoll Engineers, Inc. since 1984.
Terry J. Mortimer, Vice President and Controller since May 25, 49
1990. Previously Director - Finance and Chief Accountant for
Apple Computer since June, 1988. Previously with Becton
Dickinson and Company from January, 1981 to June, 1988, most
recently as Medical Sector Controller.
Edgar J. Smith, Jr., Vice President, General Counsel, and 60
Secretary since April 19, 1984, Vice President and General
Counsel since January 1, 1980. Previously Assistant General
Counsel since 1967.
Thomas E. Taylor, Vice President-Taxes since September 1, 1993. 48
Previously with Elf Aquitaine, Inc. as Vice President-Taxes
since 1985.
Julian B. Twombly, Vice President and Treasurer since December 48
17, 1991. Prior to joining the company, associated with United
Dominion Industries, Ltd. since 1974, most recently as Senior
Vice President and Treasurer.
The executive officers are elected annually by the Board of Directors.
There are no family relationships between any of the directors or executive
officers of the company.
ITEM 2. Properties
The Process Controls sector's operations consist of 40 manufacturing
facilities in 16 states and 9 foreign countries, containing approximately
4.5 million square feet, of which 86% is owned and 14% is leased.
The Electrical Controls sector's operations consist of 34 manufacturing
facilities in 15 states and 5 foreign countries, containing approximately
2.5 million square feet, of which approximately 69% is owned and 31% is
leased.
The Industrial Technology sector's operations consist of 10 manufacturing
facilities in 8 states, containing approximately 1.0 million square feet,
of which approximately 80% is owned and 20% is leased.
In addition to manufacturing plants, the company as lessee occupies
executive offices in Stamford, Connecticut, and various sales and service
locations throughout the world. All of these properties, as well as the
related machinery and equipment, are considered to be well-maintained,
suitable and adequate for their intended purposes. Assets subject to lien
are not significant.
As a result of recent business divestitures and restructuring activities,
the company holds 1.1 million square feet of idle facilities for sale or
sublease.
ITEM 3. Legal Proceedings
The company and certain of its subsidiaries are defendants in legal
proceedings incidental to its business. Although the ultimate disposition
of these proceedings is not presently determinable, management does not
expect the outcome to have a material adverse impact on the company's
financial position.
ITEM 4. Submission of Matters to a Vote of Security Holders
None.
PART II
ITEM 5. Market for Registrant's Common Stock and Related Shareholder
Matters
The company's common stock is listed on the New York and Pacific stock
exchanges under the symbol "GSX". Information as to quarterly prices for
the last two years, and dividends paid is included on page 33 of the
Shareholders' Report and is incorporated herein by reference. There were
approximately 9,434 holders of record of the company's common stock on
March 7, 1994.
ITEM 6. Selected Financial Data
Selected financial data of the company for the last five fiscal years are
incorporated herein by reference to pages 34 and 35 of the Shareholders'
Report.
ITEM 7. Management's Discussion and Analysis of Financial Condition and
Results of Operations
"Management's Discussion and Analysis of Financial Condition and Results
of Operations" appears on pages 14 through 17 of the Shareholders' Report
and is incorporated herein by reference.
ITEM 8. Financial Statements and Supplementary Data
The financial statements and related notes are incorporated herein by
reference to pages 19 through 33 of the Shareholders' Report. Quarterly
financial information is incorporated herein by reference to page 32 of
the Shareholders' Report. The Report of Independent Auditors, dated
January 25, 1994, is incorporated herein by reference to page 18 of the
Shareholders' Report.
ITEM 9. Changes in and Disagreements with Accountants on Accounting and
Financial Disclosure
None.
PART III
ITEM 10. Directors and Executive Officers
This information is incorporated herein by reference to pages 5 through
7 of the Proxy Statement for the 1994 annual meeting of shareholders.
Also see page 2 of this 10-K as to information related to executive
officers.
ITEM 11. Executive Compensation
This information is incorporated by reference to pages 13 through 14 of
the Proxy Statement for the 1994 annual meeting of shareholders.
ITEM 12. Security Ownership of Certain Beneficial Owners and Management
This information is incorporated by reference to pages 2 through 4 of the
Proxy Statement for the 1994 annual meeting of shareholders.
ITEM 13. Certain Relationships and Related Transactions
Not applicable.
PART IV
ITEM 14. Exhibits, Financial Statements, Schedules, and Reports on Form
8-K
(a) (1) Financial Statements and Other Financial Data.
The financial statements of the company and consolidated
subsidiaries are incorporated herein by reference to pages 19
through 33 of the Shareholders' Report. The Independent
Auditors' Report of Ernst & Young, dated January 25, 1994, is
incorporated herein by reference to page 18 of the
Shareholders' Report.
(2) Schedules and Report of Independent Auditors.
Page
Report of KPMG Peat Marwick . . . . . . . . . . . . . 6
Schedule VIII- Valuation and Qualifying Accounts . . 7
Schedule IX - Short Term Borrowings . . . . . . . . . 7
All other schedules are omitted as the required information is
not applicable or the information is presented in the financial
statements or related notes.
(3) Exhibits.
3.1 Restated Certificate of Incorporation of General Signal
Corporation, as amended through April 27, 1988, is
incorporated herein by reference to Exhibit 3.1 of the
registrant's 1988 Form 10-K filed March 17, 1989.
3.2 By-laws of General Signal Corporation, as amended
through February 3, 1994.
4.1 Copies of the instruments with respect to the company's
long-term debt are available to the Securities and
Exchange Commission upon request.
4.2 Copies of the Credit Agreements among General Signal
Corporation and Various Commercial Banking
Institutions, as amended through January 12, 1994, as
described in the Notes to Financial Statements
incorporated herein by reference in (a)(1) above, are
available to the Securities and Exchanges Commission
upon request.
10.1 Description of General Signal Corporation Incentive
Compensation Plan is incorporated herein by reference
to Exhibit 10.1 of the registrant's 1991 Form 10-K
filed March 25, 1992.
10.2 Retirement Plan for Directors of General Signal
Corporation is incorporated herein by reference to
Exhibit 10.7 of the registrant's 1988 Form 10-K filed
March 17, 1989.
10.3 General Signal Corporation Change in Control Severance
Pay Plan, as amended, is incorporated herein by
reference to Exhibit 10.8 of the registrant's 1989 Form
10-K filed March 16, 1990.
10.4 General Signal Corporation Deferred Compensation Plan
dated October 14, 1993.
10.5 General Signal Corporation Benefit Equalization Plan as
amended and restated October 14, 1993.
10.6 General Signal Corporation 1992 Stock Incentive Plan as
amended and restated July 7, 1993.
10.7 General Signal Corporation 1989 Stock Option and
Incentive Plan as amended July 7, 1993.
10.8 General Signal Corporation 1985 Stock Option Plan as
amended and restated July 7, 1993.
10.9 General Signal Corporation 1981 Stock Option Plan as
amended and restated July 7, 1993.
10.10 Consulting Agreement with Nathan R. Owen is
incorporated herein by reference to Exhibit 10.10 of
the registrant's 1986 Form 10-K filed March 30, 1987.
10.11 Employment agreement between Edmund M. Carpenter and
the registrant dated April 15, 1988 is incorporated
herein by reference to Exhibit 10.12 of the
registrant's 1988 Form 10-K filed March 17, 1989.
10.12 Employment agreement between Stephen W. Nagy and the
registrant dated August 17, 1989 is incorporated herein
by reference to Exhibit 10.11 of the registrant's 1989
Form 10-K filed March 16, 1990.
11.0 Computation of Earnings per Share. See page 8 of this
report.
12.0 Calculation of Ratios of Earnings to Fixed Charges. See
page 9 of this report.
13.0 1993 Annual Report to Shareholders. Except for those
portions specifically incorporated herein by reference,
the company's 1993 Annual Report to Shareholders is
furnished for the information of the Commission and is
not deemed to be "filed." Pages 14 through 35,
including the Independent Auditors' Report on page 18,
are specifically incorporated herein by reference.
21.0 Subsidiaries. See pages 9 through 11 of this report.
23.0 Consent of Ernst & Young. See page 12 of this report.
24.1 Consent of KPMG Peat Marwick. See page 12 of this
report.
(b) Reports on Form 8-K.
1. A report on Form 8-K was filed on June 17, 1993,
reporting the July 7, 1993 two-for-one stock split of
the company's common stock in the form of a 100 percent
stock distribution.
2. A report on Form 8-K was filed on February 4, 1994,
reporting the company's results of operations for the
quarter and year ended December 31, 1993.
SIGNATURES
Pursuant to the requirements of Section 13 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.
GENERAL SIGNAL CORPORATION
/s/ Edmund M. Carpenter
(Edmund M. Carpenter, Chairman)
March 17, 1994
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.
Signature Title Date
/s/ Edmund M. Carpenter
(Edmund M. Carpenter) Chairman and Director March 17, 1994
(Principal Executive
Officer)
/s/ Stephen W. Nagy
(Stephen W. Nagy) Senior Vice President March 17, 1994
and Chief Financial
Officer
/s/ Terry J. Mortimer
(Terry J. Mortimer) Vice President and March 17, 1994
Controller (Chief
Accounting Officer)
/s/ Ralph E. Bailey
(Ralph E. Bailey) Director March 17, 1994
/s/ Van C. Campbell
Van C. Campbell) Director March 17, 1994
/s/ Ronald E. Ferguson
(Ronald E. Ferguson) Director March 17, 1994
/s/ John P. Horgan
(John P. Horgan) Director March 17, 1994
/s/ C. Robert Kidder
(C. Robert Kidder) Director March 17, 1994
/s/ Richard J. Kogan
(Richard J. Kogan) Director March 17, 1994
/s/ Nathan R. Owen
(Nathan R. Owen) Director March 17, 1994
/s/ Roland W. Schmitt
(Roland W. Schmitt) Director March 17, 1994
/s/ John R. Selby
(John R. Selby) Director March 17, 1994
INDEPENDENT AUDITORS' REPORT
The Board of Directors and Shareholders
General Signal Corporation
We have audited the accompanying statements of earnings, shareholders'
equity, and cash flows of General Signal Corporation and consolidated
subsidiaries for the year ended December 31, 1991 (prior to the
acquisition of Revco Scientific, Inc.) These consolidated financial
statements and financial statement schedules are the responsibility of
the company's management. Our responsibility is to express an opinion on
these consolidated financial statements and financial statement schedules
based on our audit.
We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are
free of material misstatement. An audit included examining, on a test
basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles
used and significant estimates made by management, as well as evaluating
the overall financial statement presentation. We believe that our audit
provides a reasonable basis for our opinion.
In our opinion, the consolidated financial statements referred to above
present fairly, in all material respects, the results of operations and
the cash flows of General Signal Corporation and consolidated
subsidiaries for the year ended December 31, 1991 (prior to the
acquisition of Revco Scientific, Inc.) in conformity with generally
accepted accounting principles.
/s/ KPMG Peat Marwick
Stamford, Connecticut
January 24, 1992
GENERAL SIGNAL CORPORATION AND CONSOLIDATED SUBSIDIARIES
Schedule VIII - Valuation and Qualifying Accounts
Years Ended December 31, 1993, 1992 and 1991
($ in thousands)
Additions
charged
Balance at(credited) to Balance at
beginning cost and end of
of period expense Deductions period
1993
Reserves deducted
from assets:
Allowance for
doubtful accounts $8,882 $4,608 $2,968(1) $10,522
Assets held for sale 18,600 -- 4,223(3) 14,377
Dispositions and re-
structuring:
Transaction and consol-
idation of Revco -- 13,200 4,416(4) 8,784
Semiconductor 57,301 (53,200) 38,400(4) 13,348
(47,647)(5)
Restructuring -- 30,500 17,489 (4) 13,011
57,301 (9,500) 12,658 35,143
1992
Reserves deducted
from assets:
Allowance for 6,445(1)
doubtful accounts $11,074 5,502 1,249(2) $8,882
Assets held for sale -- 18,600 -- 18,600
Dispositions and
restructuring -- 67,000 9,699(4) 57,301
1991
Reserves deducted
from assets:
Allowance for
doubtful accounts $10,662 5,748 5,336(1) $11,074
(1) Write-off of bad debts, net of recoveries.
(2) Transfer of semiconductor equipment operations allowance for doubtful
accounts to assets held for sale at October 1, 1992.
(3) Charges to reserve related to businesses divested during 1993.
(4) Charges to reserve for related costs incurred during the year.
(5) Represents primarily gain on disposal of businesses divested during 1993.
<TABLE>
GENERAL SIGNAL CORPORATION AND CONSOLIDATED SUBSIDIARIES
Schedule IX - Short Term Borrowings
Years Ended December 31, 1993, 1992 and 1991
($ in thousands)
<CAPTION>
Category of Weighted Maximum amount Weighted
Year aggregate Balance at average outstanding Average amount average interest
Ended short-term end interest during outstanding during rate during
Dec 31, borrowing of period rate(2) period period period(1)
<S> <C> <C> <C> <C> <C>
1991 Notes payable
to banks $6,423 11% $18,700 $8,000 6%
1992 Notes payable
to banks $3,218 3% $13,700 $5,600 7%
1993 Notes payable
to banks $6,211 7% $11,400 $8,000 11.5%
</TABLE>
(1) Actual interest expense on short-term borrowings for the year
divided by average short-term borrowings outstanding during the year.
(2) Annual interest expense on short-term borrowing divided by the
year-end balance.
Exhibit (11.0)
GENERAL SIGNAL CORPORATION AND CONSOLIDATED SUBSIDIARIES
Computation of Earnings Per Share
(Amounts in thousands, except per share data)
Year Ended December 31,
1993 1992 1991
I. Earnings (loss) per share of common
stock (used for financial reporting):
Net earnings (loss):
Continuing operations $ 66,596 $ 12,465 $63,957
Loss on disposal of
discontinued operations --- --- (9,800)
Extraordinary charges (6,576) (330) ---
Cumulative effect of
accounting changes (25,300) (92,400) ---
Net Earnings (loss) $34,720 $(80,265) $54,157
Average number of common shares
outstanding (a) 45,205 41,753 38,572
Earnings (loss) per average share of
common stock:
Continuing operations $1.47 $.30 $1.66
Loss on disposal of
discontinued operations --- --- (.26)
Extraordinary charges (0.14) (0.01) ---
Cumulative effect of accounting
changes (0.56) (2.21) ---
$0.77 $(1.92) $1.40
II. Primary earnings per share (b)
(including common stock equivalents):
Average number of common shares
outstanding 45,205 41,753 38,572
Dilutive effect of outstanding
options (as determined by
application of the treasury
stock method) 263 298 38
Total shares used in calculation
of primary earnings per share 45,468 42,051 38,610
Primary earnings (loss) per share:
Continuing operations $1.46 $.30 $1.66
Loss on disposal of
discontinued operations --- --- (.26)
Extraordinary charges (.14) (.01) ---
Cumulative effect of accounting
changes (.56) (2.20) ---
$0.76 $(1.91) $1.40
III. Fully diluted earnings per share (b):
Average number of shares used in
calculation of primary earnings
per share above 45,468 42,051 38,610
Additional dilutive effect of
outstanding options (as determined
application of the treasury
stock method) 36 74 190
Total shares used in calculation
of fully diluted earnings
per share 45,504 42,125 38,800
Fully diluted earnings (loss) per share:
Continuing operations $1.46 $0.30 $1.65
Loss on disposal of
discontinued operations --- --- (0.25)
Extraordinary charges (0.14) (0.01) ---
Cumulative effect of accounting
changes (0.56) (2.19) ---
$0.76 $(1.90) $1.40
(a) Excludes common stock equivalents in accordance with provisions
of APB Opinion No. 15 because such equivalent shares result in dilution of
less than 3%.
(b) This calculation is presented in accordance with Regulation S-K
although the effect of the options deemed to be common stock equivalents is
antidilutive in 1992.
Exhibit (12.0)
GENERAL SIGNAL CORPORATION
Calculation of Ratios of Earnings to Fixed Charges
($ in thousands)
Year Ended December 31,
1989 1990 1991 1992 1993
Earnings:
Earnings (loss) from
continuing operations
before income taxes and
extraordinary items $108,482 $(25,193) $89,451 $18,786 $94,398
Add: fixed charges 54,526 47,724 40,626 37,029 23,440
$163,008 $22,531 $130,077 $55,815 $117,838
Fixed charges:
Interest expense $44,759 $37,557 $32,193 $28,629 $18,240
One-third of rent
expense 9,767 10,167 8,433 8,400 5,200
$54,526 $47,724 $40,626 $37,029 $23,440
Ratio 2.99 .47 (1)3.20 1.51 5.03
(1) Earnings are inadequate to cover fixed charges by an amount of
approximately $25 million.
Exhibit (21.0)
SUBSIDIARIES OF REGISTRANT
Percent Organized Under the
1. Consolidated Subsidiaries Owned Laws of
Subsidiaries of General Signal Corporation:
Aurora/Hydromatic Pumps Inc. 100 Delaware
Borri Elettronica Industriale S.p.A. 100 Italy
Subsidiary of Borri Elettronica Industriale S.p.A.
Borri Stromversorgunanlagen GMBH 100 Germany
DeZurik of Australia Proprietary Ltd. 100 Australia
GCA Europa S.A. 100 France
GCA International Corporation 100 New Jersey
G. S. Building Systems Corporation 100 Connecticut
Subsidiaries of G. S. Building Systems
Corporation:
Dual-Lite Manufacturing, Inc. 100 Delaware
General Signal FSC Corp 100 Virgin Islands
General Signal Holdings Company 100 Delaware
Subsidiary of General Signal Holdings Company
General Signal Technology Corporation 100 Delaware
Subsidiaries of General Signal Technology
Corporation:
Assembly Technologies - AP, Inc. 100 Delaware
General Farebox Service of Atlanta, Inc. 100 Delaware
GFI Service of Chicago, Inc. 100 Delaware
GFI Service of New York, Inc. 100 Delaware
General Signal Japan Corporation 100 Japan
General Signal SEG Korea 100 Korea
Revco Scientific, Inc. 100 Delaware
General Signal Kabushiki Kaisha 100 Japan
General Signal Limited 100 Canada
General Signal SEG Asia, Ltd. 100 Hong Kong
General Signal S.E.G. SARL 100 France
General Signal UK Limited 100 England
Subsidiaries of General Signal UK Limited:
DeZurik International Ltd. 100 England
GCA Limited 100 England
G.S. Iona Ltd. 100 England
General Signal SEG, Ltd. 100 England
Leeds & Northrup Limited 100 England
Lightnin Europe Limited 100 England
Lightnin Mixers Limited 100 England
Subsidiaries of Lightnin Mixers Ltd.:
Deutsche Lightnin Jesse Mischtechnik
Verwaltungsgesellschaft mbH 90 Germany
(Remaining 10% owned by General Signal
Corporation Inc.)
Turbo - Maschinenbau G.m.b.H. 100 Germany
Turbo - Lightnin Mischtechnik
GmbH & Co. KG 100 Germany
Sola (UK) Limited 75 England
Tau-Tron (UK) Limited 100 England
Telenex Europe Limited 100 England
Leeds & Northrup Company 100 Delaware
Subsidiaries of Leeds & Northrup Company:
Leeds & Northrup Australia Pty., Ltd. 100 Australia
Subsidiary of Leeds & Northrup
Australia Pty., Ltd.:
Leeds & Northrup(New Zealand)Ltd. 100 New Zealand
Leeds & Northrup GmbH 100 Germany
Leeds & Northrup Mexicana, S.A. 100 Mexico
Leeds & Northrup S.A. 100 Spain
LDN, Ltd. 100 Delaware
Subsidiary of LDN, Ltd.
Leeds & Northrup S.A.R.L. 100 France
L.D.N. Netherlands, B.V. 100 Netherlands
L&N Singapore, Pte., Ltd. 100 Singapore
Leeds & Northrup Italy, S.p.A. 53 Italy
(47% owned by Leeds & Northrup Company;
Lightnin Mixers Pty. Ltd. 60 Australia
(Remaining 40% owned by General Signal Ltd.)
Lightnin Pte. Ltd. 100 Singapore
Metal Forge Company, Inc. 100 Delaware
Shenyang Stock Electric Power Equipment Company,
Limited 100 China
Sola Australia, Limited 100 Australia
Sola Electric AG 100 Switzerland
Stock Japan, Ltd. 100 Japan
Telenex Corporation 100 New Jersey
2.Other Subsidiaries
The following minor foreign subsidiaries and the investment in
50-percent-or-less owned companies, which are not material individually or in
the aggregate in relation to the financial statements, are carried at cost
plus equity in undistributed earnings since acquisition.
Subsidiaries of General Signal Corporation:
DeZurik - India 40 India
DeZurik Japan Co., Ltd. 48 Japan
DeZurik Mexico, S.A. de C.V. 49 Mexico
General Signal Acquisition Corporation 100 Delaware
General Signal Corporation 100 Delaware
General Signal International Corporation 100 Delaware
HMS Ventures Ltd. 14 California
High Ridge Company, Limited 100 Bermuda
Industrias Sola Basic, S.A. 49 Mexico
Koyo Lindberg Ltd. 50 Japan
New Signal, Inc. 100 Delaware
Solamex, S.A. de C.V. 48 Mexico
Subsidiary of Solamex, S.A. de C.V.:
Industrial GESCA S.A.deC.V. 99 Mexico
Inmobiliaria S-Tres, S.A.deC.V. 99 Mexico
Inmobiliaria S-Dos, S.A.deC.V. 99 Mexico
Inmobiliaria Solamex, S.A. de C.V. 99 Mexico
Productora Y Maquiladora Queretana
S.A.deC.V. 99 Mexico
Solenergy Corporation 30 Massachusetts
Terasaki Nelson Ltd. 50 Japan
Exhibit (23.0)
CONSENT OF ERNST & YOUNG
The Board of Directors and Shareholders
General Signal Corporation
We consent to the incorporation by reference in this Annual Report (Form
10-K) of General Signal Corporation of our report dated January 25, 1994,
included in the 1993 Annual Report to Shareholders of General Signal
Corporation.
Our audit also included the 1993 and 1992 financial statement schedules
of General Signal Corporation and consolidated subsidiaries listed in
Item 14(a). These schedules are the responsibility of the company's
management. Our responsibility is to express an opinion based on our
audits. In our opinion, the 1993 and 1992 financial statement schedules
referred to above, when considered in relation to the basic financial
statements taken as a whole, present fairly in all material respects, the
information set forth therein.
We also consent to the incorporation by reference in the Registration
Statements (Form S-3 No. 33-33929), (Form S-8 No. 33-46613) pertaining
to the General Signal Corporation Savings and Stock Ownership Plan, (Form
S-8 No. 33-47495) pertaining to General Signal Corporation's stock
incentive plans, (Form S-3 No. 33-50081) pertaining to the merger
agreement with Revco Scientific, Inc. and related prospectuses of our
report dated January 25, 1994, with respect to the 1993 and 1992
financial statements incorporated herein by reference, and our report
included in the preceding paragraph with respect to the 1993 and 1992
financial statement schedules included in this Annual Report (Form 10-K)
of General Signal Corporation.
/s/ Ernst & Young
Stamford, Connecticut
March 18, 1994
Exhibit (23.1)
CONSENT OF KPMG PEAT MARWICK
The Board of Directors and Shareholders
General Signal Corporation
We consent to incorporation by reference in the Registration
Statements on Forms S-3 (No. 33-33929 and 33-50081) and on Forms S-8
(Nos. 33-46613 and 33-47495) of General Signal Corporation of our report
dated January 24, 1992, relating to the balance sheet of General Signal
Corporation and consolidated subsidiaries as of December 31, 1991 and the
related statements of earnings, shareholders' equity and cash flows and
related schedules for the years ended December 31, 1991 and 1990, which
report appears in the December 31, 1992 Annual Report on Form 10-K of
General Signal Corporation.
/s/ KPMG Peat Marwick
Stamford, Connecticut
March 18, 1994
GENERAL SIGNAL CORPORATION
__________
BY-LAWS
__________
As Amended Through February 3, 1994
ARTICLE I
SHAREHOLDERS' ANNUAL MEETING
SECTION 1: The Annual Meeting of the shareholders of this
Corporation for the election of directors and the transaction of such other
business as may properly come before such meeting shall be held each year on
such date and at such time and place, whether within or without the State of
New York, as shall be determined by the Board of Directors.
SHAREHOLDERS' SPECIAL MEETINGS
SECTION 2: A Special Meeting of the shareholders may be held at any
time upon the call of the Board of Directors or the Chairman of the Board and
shall be called by the Secretary at the written request of shareholders owning
at least two-thirds of the outstanding shares of stock entitled to vote, which
request shall specify the matters to be presented to such meeting.
NOTICE OF ANNUAL OR SPECIAL MEETINGS
SECTION 3: Written notice of the holding of each Annual or Special
Meeting of the shareholders shall be given by the Secretary. Such notice
shall state the place, date and hour of the meeting, and the purpose or
purposes for which the meeting is called, and shall be signed by the
Secretary, and shall indicate that it is being issued by or at the direction
of the person or persons calling the meeting. A copy of such notice shall be
mailed, postage prepaid, not less than ten nor more than fifty days before the
date of the meeting, to each shareholder of record as of such record date, not
less than ten nor more than fifty days before the date of the meeting, as may
be fixed by the Board of Directors for determining the shareholders entitled
to notice of, or to vote at, the meeting. Such notice shall be directed to
the shareholder at his address as it appears on the record of shareholders,
or, if he shall have filed with the Secretary a written request that notices
to him be mailed to some other address, then directed to him at such other
address.
If, at any meeting, action is proposed to be taken which would, if
taken, entitle certain shareholders to receive payment for their shares, the
notice of such meeting shall include a statement of that purpose and to that
effect.
At any meeting of shareholders or any such adjourned meeting, only
such business shall be conducted as shall have been properly brought before
such meeting or any such adjourned meeting. To be properly brought before any
meeting of shareholders or any such adjourned meeting, business must be (a)
specified in the notice of meeting (or any supplement thereto) given by or at
the direction of the Board of Directors, (b) otherwise properly brought before
such meeting or any such adjourned meeting by or at the direction of the Board
of Directors, or (c) otherwise properly brought before such meeting or any
such adjourned meeting by a shareholder. For business to be properly brought
before any meeting of shareholders or any such adjourned meeting by a
shareholder, the shareholder must have given timely notice thereof in writing
to the Secretary. To be timely, a shareholder's notice must be delivered to
or mailed and received at the principal executive offices of the Corporation
not less than forty-five days nor more than sixty days prior to such meeting;
provided, however, that in the event less than fifty-five days prior public
disclosure of the date of such meeting is made to the shareholders or in the
event the only public disclosure of the date of the meeting is written notice
in accordance with this Article 1, Section 3, notice by such shareholder to be
timely must be so received not later than the close of business on the tenth
day following the day on which such notice of the date of such meeting was
mailed or such public disclosure was made. A shareholder's notice to the
Secretary shall set forth as to each matter the shareholder proposes to bring
before such meeting (a) a brief description of the business desired to be
brought before such meeting and the reasons for conducting such business at
such meeting, (b) the name and address, as they appear on the Corporation's
books, of the shareholder proposing such business, (c) the class and number of
shares of the securities of the Corporation which are beneficially owned by
such shareholder, and (d) any material interest of such shareholder in such
business.
No business shall be conducted at any meeting of shareholders or any
such adjourned meeting except in accordance with the procedures set forth in
this Article 1, Section 3. In the event that a shareholder seeks to bring one
or more matters before a meeting of shareholders or any such adjourned
meeting, the Board of Directors shall establish a committee consisting of
non-management directors for the purpose of reviewing compliance with this
Article 1, Section 3; provided, however, that if the business to be brought
before such meeting or any such adjourned meeting by a shareholder relates to
the removal, replacement or election of one or more directors, the Secretary
shall appoint two or more inspectors, neither of whom shall be an affiliate of
the Corporation, to act in lieu of such committee to review compliance with
this Article 1, Section 3. If the committee or the inspectors (as the case may
be) shall determine that a shareholder has not complied with this Article 1,
Section 3, the committee or the inspectors (as the case may be) shall direct
the chairman of such meeting to declare to such meeting or any such adjourned
meeting that such business was not properly brought before such meeting or any
such adjourned meeting in accordance with the provisions of this Article 1,
Section 3; and the chairman shall so declare to such meeting or any such
adjourned meeting and any such business not properly brought before such
meeting or any such adjourned meeting shall not be transacted.
Only individuals who are nominated in accordance with the procedures
set forth in this Article 1, Section 3, shall be eligible for election as
directors. Nominations of individuals for election to the Board of Directors
may be made at a meeting of shareholders or any such adjourned meeting by or
at the direction of the board of Directors or by any shareholder of the
Corporation entitled to vote for the election of directors at such meeting or
any such adjourned meeting who complies with the notice procedures set forth
in this Article 1, Section 3.
Such nominations, other than those made by or at the direction of
the Board of Directors, shall be made pursuant to timely notice in writing to
the Secretary. To be timely, a shareholder's notice shall be delivered to or
mailed and received at the principal executive offices of the Corporation not
less than forty-five days nor more than sixty days prior to such meeting;
provided, however, that in the event less than fifty-five days prior public
disclosure of the date of such meeting is made to the shareholders or in the
event the only public disclosure of the date of the meeting is written notice
in accordance with this Article 1, Section 3, notice by such shareholder to be
timely must be so received not later than the close of business on the tenth
day following the day on which such notice of the date of such meeting was
mailed or such public disclosure was made. Such shareholder's notice shall
set forth (a) as to each individual whom such shareholder proposes to nominate
for election or re-election as director, (i) the name, age, business address
and residence address of such individual, (ii) the principal occupation or
employment of such individual, (iii) the class and number of shares, or the
amount of any securities of the Corporation which are beneficially owned by
such individual and (iv) any other information relating to such individual
that is required to be disclosed in solicitations of proxies for election of
directors, or is otherwise required, in each case, pursuant to Regulation 14A
under the Securities Exchange Act of 1934, as amended (including without
limitation such individual's written consent to being named in the proxy
statement as a nominee and to serving as a director if elected); and (b) as to
the shareholder giving the notice, (i) the name and address, as they appear on
the Corporation's books, of such shareholder and (ii) the class and number of
shares of the securities of the Corporation which are beneficially owned by
such shareholder. At the request of the Board of Directors, any individual
nominated by the Board of Directors for election as a director shall furnish
to the Secretary that information required to be set forth in a shareholder's
notice of nomination which pertains to the nominee. No individual shall be
eligible for election as a director of the Corporation unless nominated in
accordance with the procedures set forth in this Article 1, Section 3. In the
event that a shareholder seeks to nominate one or more directors, the
Secretary shall appoint two inspectors, neither of whom shall be an affiliate
of the Corporation, to determine whether such shareholder has complied with
this Article 1, Section 3. If the inspectors shall determine that such
shareholder has not complied with this Article 1, Section 3, the inspector
shall direct the chairman of such meeting or any such adjourned meeting to
declare to such meeting or any such adjourned meeting that a nomination was
not made in accordance with the prescribed procedures, and the chairman shall
so declare to such meeting or any such adjourned meeting and the defective
nomination shall be disregarded.
PRESIDING OFFICER
SECTION 4: At all meetings of shareholders the Chairman of the Board
shall preside, or in his absence, any Vice Chairman of the Board, the Chairman
of the Executive Committee, the President or any Vice President may preside.
INSPECTORS
SECTION 5: Prior to each meeting of the shareholders, the Board of
Directors may appoint two Inspectors of Election and two or more Alternate
Inspectors, to serve at such meeting and any adjournment thereof. If any
Inspector refuses to serve, or shall not be present at the meeting of the
shareholders, the Alternate Inspectors shall act in the order of their
appointment.
VOTING AND METHOD OF
SECTION 6: Except as otherwise provided in the Certificate of
Incorporation, at all meetings of the shareholders, each shareholder entitled
to vote shall be entitled to one vote for every share standing in his name on
the record of shareholders, and all questions to be decided by the
shareholders, except the question of election of directors and such other
questions the manner of deciding which is specifically regulated by statute,
shall be decided by a majority of the votes cast at the meeting in person or
by proxy by the holders of shares entitled to vote thereon. All voting shall
be viva-voce, except that any qualified voter may require a vote by ballot on
any question to be decided. In case of a vote by ballot, each ballot shall
state the name of the shareholder voting and the number, class and series (if
any) of shares owned by him, and in addition, if such ballot be cast by a
proxy, the name of the proxy shall be stated.
QUORUM
SECTION 7: Except as may be otherwise provided by law or by the
Certificate of Incorporation, at all meetings of the shareholders, the holders
of a majority of the shares entitled to vote thereat shall constitute a quorum
for the transaction of any business.
FISCAL YEAR
SECTION 8: The fiscal year of the Corporation shall close on the
31st day of December in each year. The officers of the Corporation shall
prepare and cause to be submitted to the shareholders at the Annual Meeting a
detailed statement showing the financial condition of the Corporation.
DIRECTORS
ARTICLE II
DIRECTORS, ELECTION OF
SECTION 1: The directors shall be classified with respect to their
terms of office by dividing them into three classes. All classes shall be as
nearly equal in number as possible, and no class shall include less than three
directors. Subject to such limitations, the size of each class may be fixed
by action of the shareholders or of the Board of Directors.
At each Annual Meeting of Shareholders, directors to replace those
whose terms expire at such Annual Meeting shall be elected to hold office
until the expiration of the term of whatever class they are assigned to,
provided that no director may be assigned to a class the term of which will
expire later than the Annual Meeting next succeeding the director's attaining
age 72. Notwithstanding the foregoing, Nathan R. Owen shall be permitted to
be nominated for a one-year term at the 1994 Annual Meeting of Shareholders.
Each director shall hold office until the expiration of the term for
which he is elected, and until his successor has been elected and qualified,
provided, however, that a director may be removed from office as a director,
but only for cause, by action of the shareholders or of the Board of
Directors.
NUMBER OF DIRECTORS
SECTION 2: The number of the directors of the Corporation shall be
not less than 9 nor more than 15 as shall be determined from time to time by
the Board of Directors.
NEWLY CREATED DIRECTORSHIPS AND VACANCIES
SECTION 3: Newly created directorships resulting from an increase in
the number of directors and vacancies occurring in the Board for any reason
may be filled by the vote of a majority of the directors then in office,
although less than a quorum may exist. A director elected to fill a newly
created directorship or a vacancy shall be elected to hold office until the
next Annual Meeting of the shareholders, and (if he is to have a successor)
until his successor has been elected and qualified.
REGULAR MEETINGS
SECTION 4: Regular Meetings of the Board of Directors shall be held
at such times and places as may be fixed by the Board of Directors provided
that the Organization Meeting of the newly elected Board of Directors shall be
held on the same day as the Annual Meeting of the shareholders, at which time
the Executive Committee and other Committees of the Board and Officers shall
be elected or appointed. Unless otherwise required by appropriate resolution
of the Board of Directors, or by law, notice of any such meetings need not be
given.
SPECIAL MEETINGS
SECTION 5: Special Meetings of the Board of Directors shall be
called by the Secretary upon the order of the Chairman of the Board, the
President, any Vice Chairman of the Board, or the Chairman of the Executive
Committee, or upon the written request of five (5) directors.
PRESIDING OFFICER
SECTION 6: At all meetings of the Board of Directors, the Chairman
of the Board of Directors shall preside, or in his absence, any Vice Chairman
of the Board, the Chairman of the Executive Committee, the President or any
Vice President who is a member thereof may preside.
QUORUM
SECTION 7: A majority of the directors then in office or half of
such number when the number of directors then in office is even, but not less
than one-third of the entire Board, shall constitute a quorum for the
transaction of business at all meetings of the Board.
NOTICE
SECTION 8: The Secretary shall mail to each director notice of any
Special Meeting, or of any Regular Meeting, if required, at least two days
before the meeting, or shall telegraph or telephone such notice not later than
the day before such meeting. Each director shall file with the Secretary a
designation of the address to which such notice to him shall be sent, and any
such notice to him thereafter shall be addressed in accordance with his latest
designation.
EXECUTIVE AND OTHER COMMITTEES, DESIGNATION OF
SECTION 9: The Board of Directors shall by resolution adopted by a
majority of the entire Board, designate an Executive Committee of not less
than three of its members of whom the Chairman of the Board, the Chairman of
the Executive Committee, and the President shall be ex officio members, and
said Executive Committee shall have authority to exercise and shall exercise
in the interim between the Regular and Special meetings of the Board of
Directors all of the rights, powers and duties of the Board of Directors,
except such as cannot be lawfully delegated.
The Board of Directors may by resolution adopted by a majority of
the entire Board, designate one or more directors as alternate members of the
Executive Committee, who may replace any absent member or members of the
Executive Committee, at any meeting thereof, when required to constitute a
quorum.
Meetings of the Executive Committee may be called by the Secretary
upon order by the Chairman of the Executive Committee or in his absence by the
Chairman of the Board, the President, or any Vice Chairman of the Board who is
a member thereof, or upon written request of two (2) members of the Executive
Committee.
At all meetings of the Executive Committee, the Chairman of the
Executive Committee shall preside, or in his absence the Chairman of the
Board, the President or any Vice Chairman of the Board who is a member thereof
may preside.
At all meetings of the Executive Committee, a majority of the full
membership of the Executive Committee, including vacancies not filled or
eliminated, shall constitute a quorum for the transaction of business.
The Board of Directors may by resolution adopted by a majority of
the entire Board, designate other Committees, each consisting of three or more
directors, and delegate to them such powers and duties of the Board as may be
lawfully delegated and determined to be appropriate by the Board.
The Executive Committee and each other Committee designated pursuant
to this Section, and each member or alternate member thereof, shall serve
until the next Annual Meeting of the shareholders and at the pleasure of the
Board of Directors. Vacancies in the Executive Committee or any other
Committee, occurring for any reason, may by resolution adopted by a majority
of the entire Board at any meeting of the Board of Directors, be filled or may
be eliminated by reducing the number constituting the membership of such
Committee, provided, however, that the membership of any Committee shall not
be reduced to less than three.
Notice of the time and place of any meeting of the Executive
Committee shall be given in the manner provided in Section 8 of this Article
for the giving of notice of meetings of the Board of Directors. Meetings of
any other Committee designated pursuant to this Section 9 shall be held in
such manner, and at such times and places, and upon such notice, if any, as
shall be provided in the resolution of the Board creating such Committee.
COMPENSATION
SECTION 10: Each director who is not a full-time employee of the
Corporation or of any consolidated subsidiary shall be paid such compensation
for serving as a director as the Board of Directors may, from time to time,
determine.
ACTION BY UNANIMOUS WRITTEN CONSENT
Section 11: Any action required to be or permitted to be taken by
the Board of Directors or any Committee thereof may be taken without a meeting
if all members of the Board of Directors or the Committee consent in writing
to the adoption of a resolution authorizing the action. The resolution and
written consents thereto by the members of the Board of Directors or Committee
shall be filed with the minutes of the proceedings of the Board of Directors
or Committee.
PARTICIPATION IN MEETINGS BY MEANS OF CONFERENCE TELEPHONE
SECTION 12: Any one or more members of the Board of Directors or any
Committee thereof may participate in a meeting of the Board of Directors or
Committee by means of a conference telephone or similar communication
equipment allowing all persons participating in the meeting to hear each other
at the same time. Participation by such means shall constitute presence in
person at such meeting.
OFFICERS
ARTICLE III
EXECUTIVE OFFICERS
SECTION 1: The Officers of the Corporation shall consist of a
Chairman of the Board of Directors, a President, one or more Vice Chairmen of
the Board, a Vice President-Finance, one or more other Vice Presidents, one or
more of whom may also be designated Executive Vice President or Senior Vice
President, a Secretary, a Treasurer and a Controller, all of whom shall be
elected annually by the Board at a meeting following the Annual Meeting of the
shareholders. The Board may also elect one or more Assistant Treasurers and
one or more Assistant Secretaries and such subordinate officers and agents of
the Corporation as it may from time to time determine. The same person may
hold two or more offices, except that the Chairman of the Board and President
shall not hold the office of Secretary.
CHAIRMAN OF THE BOARD, DUTIES OF
SECTION 2: The Chairman of the Board shall be a director and shall
be chief executive officer of the Corporation and, subject to the direction of
the Board, shall exercise general supervision over the business and affairs of
the Corporation and shall perform such other duties as may be assigned to him
from time to time by the Board. If the office of the President is not
independently established, he shall perform all duties of that office. He
shall preside at all meetings of the Board of Directors and shall also preside
at all meetings of the shareholders of the Corporation.
PRESIDENT, DUTIES OF
SECTION 3: The President shall be a director and shall be the chief
operating officer of the Corporation and, subject to the direction of the
Board of Directors and the Chairman of the Board, shall direct and supervise
the business operations of the Corporation and shall perform such other duties
as from time to time the Board of Directors may prescribe or the Chairman of
the Board may assign to him. The office of the President will normally be
vested in the Chairman of the Board, provided, however, that in the discretion
of the Board of Directors, the position of President may be established
independent of, but reporting to, the Chairman of the Board.
VICE CHAIRMAN OF THE BOARD, DUTIES OF
SECTION 4: A Vice Chairman of the Board shall be a director and
shall have such duties as may be assigned to him by the Board of Directors or
the Chairman of the Board.
VICE PRESIDENT-FINANCE, AND OTHER VICE PRESIDENTS, DUTIES OF
SECTION 5: The Vice President-Finance shall serve as principal
financial officer of the Corporation and shall perform such other duties as
shall from time to time be prescribed by the Board of Directors or assigned to
him by the Chairman of the Board or by the President. Each other Vice
President shall perform such duties as from time to time may be prescribed by
the Board of Directors or assigned to him by the Chairman of the Board or the
Officer to whom he reports.
TREASURER AND CONTROLLER, DUTIES OF
SECTION 6: The Treasurer shall have the care and custody of all the
funds and securities of the Corporation and, in general, shall perform all the
duties incident to the office of Treasurer including the appointment of
depository and disbursement banks. The Controller shall have charge of the
books of account of the Corporation and, in general, perform all the duties
incident to the office of Controller. The Treasurer and the Controller shall
also discharge such other duties as from time to time the Board of Directors
may prescribe or the Chairman of the Board, the President, or the Vice
President-Finance may assign.
SECRETARY, DUTIES OF
SECTION 7: The Secretary shall keep the minutes of the meetings of
the Board of Directors, of the Executive Committee and other Committees of the
Board and of the shareholders, and shall attend to the giving and service of
all notices for meetings of the Board of Directors, of the Executive Committee
and other Committees of the Board and of the shareholders and otherwise
whenever required, except to the extent, that such duties shall have been
specifically delegated to another officer by the Board of Directors or by the
Chairman of the Board. He shall have the custody of such books and papers as
the Board of Directors, the Chairman of the Board, or the President may
provide. He shall also discharge such other duties as from time to time the
Board of Directors may prescribe or the Chairman of the Board, or the
President may assign to him.
ASSISTANT OFFICERS
SECTION 8: The Board of Directors may elect one or more Assistant
Secretaries or one or more Assistant Treasurers. Each Assistant Secretary, if
any, and each Assistant Treasurer, if any, shall have such authority and
perform such duties as from time to time the Board of Directors may prescribe
or the Chairman of the Board or the President may assign.
SUBORDINATE OFFICERS
SECTION 9: The Board of Directors may elect such subordinate
officers as it may deem desirable. Each such officer shall have such
authority and perform such duties as the Board of Directors may prescribe.
The Board of Directors may, from time to time, authorize any officer to
appoint and remove subordinate officers and prescribe the powers and duties
thereof.
SURETY BONDS OF OFFICERS
SECTION 10: The Board of Directors may require from any officer of
the Corporation a bond in such amount as it may determine for the faithful
discharge of the duties of any such officer; such bond to be approved by the
Board and to be obtained at the expense of the Corporation.
COMPENSATION OF OFFICERS
SECTION 11: The Chairman of the Board, with the advice of the
President of the Corporation, shall have power to fix the compensation of all
officers of the Corporation, except the Chairman of the Board and the officers
reporting directly to him. The Board of Directors shall have power to fix the
compensation of the Chairman of the Board and of the officers reporting
directly to him. The Board of Directors may authorize any officer, upon whom
the power of appointing subordinate officers may have been conferred, to fix
the compensation of such subordinate officers.
VACANCY
SECTION 12: Any vacancy of an office occurring may be filled at any
Regular or Special Meeting of the Board of Directors.
REMOVAL OF OFFICERS
SECTION 13: Any officer of the Corporation may be removed, with or
without cause, by the vote of the Board of Directors at any meeting thereof.
CHECKS AND OBLIGATIONS
SECTION 14: All notes and all checks, drafts, or other orders for
the payment of money, and all endorsements thereof, executed on behalf of the
Corporation shall be signed by any person or persons designated for the
purpose either by the Board or by an officer or officers of the Corporation
pursuant to authority delegated by the Board of Directors.
EXECUTION OF CONTRACTS, ASSIGNMENTS, DEEDS AND OTHER DOCUMENTS
SECTION 15: All contracts, agreements, assignments, transfers,
guaranties, deeds, stock powers or other instruments of the Corporation may be
executed and delivered by the Chairman of the Board, the President, any Vice
Chairman of the Board, or any Vice President or by such other officer or
officers, or agent or agents, of the Corporation as shall be thereunto
authorized from time to time either by the Board or by power of attorney
executed by the Chairman of the Board, the President, any Vice Chairman of the
Board, or by any person pursuant to authority granted by the Board; and the
Secretary or any Assistant Secretary, the Treasurer or any Assistant Treasurer
may affix the seal of the Corporation thereto and attest same.
EXECUTION OF PROXIES
SECTION 16: The Chairman of the Board, the President, any Vice
Chairman of the Board, or any Vice President or any other person designated by
the Board of Directors, may authorize from time to time the execution and
issuance of proxies to vote upon shares of stock of other corporations owned
by the corporation, or authorize the execution of a consent to action taken or
to be taken by such other corporation. All such proxies or consents may be
signed in the name of the Corporation by any of the persons above-mentioned in
this Section 16 or by any other person or persons designated for the purpose
either by the Board of Directors or by power of attorney executed by any
person pursuant to authority granted by the Board.
FACSIMILE SIGNATURES
SECTION 17: Any signature which is authorized by Section 14, 15 or
16 of this Article may be facsimile, if so determined by the Board of
Directors, or by an officer or officers of the Corporation pursuant to
authority delegated by the Board of Directors.
CREATION OF DIVISIONS
ARTICLE IV
CREATION OF DIVISIONS
SECTION 1: The Board of Directors may from time to time create
divisions and may set apart to such divisions such aspects or portions of the
business, affairs and properties of the Corporation as the Board may from time
to time determine. Each division of the Corporation shall be organized and
regulated as hereinafter provided in this Article IV. As used in the
succeeding Sections of this Article, the term "Company" shall refer to any
division of the Corporation.
EXECUTIVE OFFICERS OF COMPANY
SECTION 2: The Chairman of the Board of the Corporation may appoint,
with the advice of the President of the Corporation, as Executive Officers of
the Company, a President, one or more Vice Presidents, appropriate Financial
Officers and a Secretary and in his discretion, one or more Assistant
Secretaries and Assistant Financial Officers and such subordinate officers as
may from time to time be deemed desirable. Such officers shall be appointed
as soon as practicable following the creation of the Company and thereafter
shall hold office at the discretion of the Chairman of the Board of the
Corporation. The same person may hold two or more offices of the Company,
except the offices of President and Secretary of the Company, and any person
holding an office of the Company may also be elected by the Board as an
officer of the Corporation. Vacancies occurring in any office may be filled
at any time by the Chairman of the Board of the Corporation, with the advice
of the President of the Corporation. The Executive Officers and all other
persons who shall serve the Company in the capacities set forth in this
Article are hereby appointed agents of the Corporation with the powers and
duties herein set forth. However, the authority of said agents shall be
limited to matters related to the properties, business and affairs of the
Company, and shall not extend to any other portion of the properties, business
and affairs of the Corporation nor are such Executive Officers or other
persons to be considered officers of the Corporation.
AUTHORITY OF THE EXECUTIVE OFFICERS OF COMPANY
SECTION 3: The President of the Company shall be the Chief Executive
Officer of the Company. He shall exercise general supervision over the
business, affairs and properties of the Company and shall be directly
responsible to, and shall perform such other duties as may be assigned to him
from time to time by, the Chairman of the Board or the assigned Officer or
other employee of the Corporation to whom the President of the Company
reports. All Executive Officers other than the President of the Company, and
any subordinate officers, shall be directly responsible to the President of
the Company and any Officer or other employee of the Corporation as the
Chairman of the Board or the assigned Officer or other employee of the
Corporation to whom the President of the Company reports shall direct.
USE OF DIVISIONAL NAMES
SECTION 4: In executing any document on behalf of any division of
the Corporation, the name of such division shall be followed by the words "a
division of General Signal Corporation." In any instance in which a division
of the Corporation shall use the name of the division followed by the words,
"a unit of General Signal," such words shall have the same meaning as "a
division of General Signal Corporation."
INDEMNIFICATION
ARTICLE V
SECTION 1: Except to the extent expressly prohibited by the New York
Business Corporation Law, the Corporation shall indemnify each person made or
threatened to be made a party to any action or proceeding, whether civil or
criminal, and whether by or in the right of the Corporation or otherwise, by
reason of the fact that such person or such person's testator or intestate is
or was a director or officer of the Corporation, or serves or served at the
request of the Corporation any other corporation, partnership, joint venture,
trust, employee benefit plan or other enterprise in any capacity while he or
she was such a director or officer (hereinafter referred to as "Indemnified
Person"), against judgments, fines, penalties, amounts paid in settlement and
reasonable expenses, including attorneys' fees, incurred in connection with
such action or proceeding, or any appeal therein, provided that no such
indemnification shall be made if a judgment or other final adjudication
adverse to such Indemnified Person establishes that either (a) his or her acts
were committed in bad faith, or were the result of active and deliberate
dishonesty, and were material to the cause of action so adjudicated, or (b)
that he or she personally gained in fact a financial profit or other advantage
to which he or she was not legally entitled.
The Corporation shall advance or promptly reimburse upon request any
Indemnified Person for all expenses, including attorneys' fees, reasonably
incurred in defending any action or proceeding in advance of the final
disposition thereof upon receipt of an undertaking by or on behalf of such
Indemnified Person to repay such amount if such Indemnified Person is
ultimately found not be entitled to indemnification or, where indemnification
is granted, to the extent the expenses so advanced or reimbursed exceed the
amount to which such Indemnified Person is entitled.
Nothing herein shall limit or affect any right of any Indemnified
Person otherwise than hereunder to indemnification or expenses, including
attorneys' fees, under any statute, rule, regulation, certificate of
incorporation, by-law, insurance policy, contract or otherwise.
Anything in these by-laws to the contrary notwithstanding, no
elimination of this by-law, and no amendment of this by-law adversely
affecting the right of any Indemnified Person to indemnification or
advancement of expenses hereunder shall be effective until the 60th day
following notice to such Indemnified Person of such action, and no elimination
of or amendment to this by-law shall thereafter deprive any Indemnified Person
of his or her rights hereunder arising out of alleged or actual occurrences,
acts or failures to act prior to such 60th day.
The Corporation shall not, except by elimination or amendment of
this by-law in a manner consistent with the preceding paragraph, take any
corporate action or enter into any agreement which prohibits, or otherwise
limits the rights of any Indemnified Person to, indemnification in accordance
with the provisions of this by-law. The indemnification of any Indemnified
Person provided by this by-law shall be deemed to be a contract between the
Corporation and each Indemnified Person and shall continue after such
Indemnified Person has ceased to be a director or officer of the Corporation
and shall inure to the benefit of such Indemnified Person's heirs, executors,
administrators and legal representatives. If the Corporation fails timely to
make any payment pursuant to the indemnification and advancement or
reimbursement of expenses provisions of this Article V and an Indemnified
Person commences an action or proceeding to recover such payment, the
Corporation in addition shall advance or reimburse such Indemnified Person for
the legal fees and other expenses of such action or proceeding.
The Corporation is authorized to enter into agreements with any of
its directors or officers extending rights to indemnification and advancement
of expenses to such Indemnified Person to the fullest extent permitted by
applicable law, but the failure to enter into any such agreement shall not
affect or limit the rights of such Indemnified Person pursuant to this by-
law, it being expressly recognized hereby that all directors or officers of
the Corporation, by serving as such after the adoption hereof, are acting in
reliance hereon and that the Corporation is estopped to contend otherwise.
Persons who are not directors or officers of the Corporation shall be
similarly indemnified and entitled to advancement or reimbursement of expenses
to the extent authorized at any time by the Board of Directors.
In case any provision in this by-law shall be determined at any time
to be unenforceable in any respect, the other provisions shall not in any way
be affected or impaired thereby, and the affected provision shall be given the
fullest possible enforcement in the circumstances, it being the intention of
the Corporation to afford indemnification and advancement of expenses to its
directors or officers, acting in such capacities or in the other capacities
mentioned herein, to the fullest extent permitted by law whether arising from
alleged or actual occurrences, acts or failures to act occurring before or
after the adoption of this Article V.
For purposes of this by-law, the Corporation shall be deemed to have
requested an Indemnified Person to serve an employee benefit plan where the
performance by such Indemnified Person of his or her duties to the Corporation
also imposes duties on, or otherwise involves services by, such Indemnified
Person to the plan or participants or beneficiaries of the plan, and excise
taxes assessed on an Indemnified Person with respect to an employee benefit
plan pursuant to applicable law shall be considered indemnifiable fines. For
purposes of this by-law, the term "Corporation" shall include any legal
successor to the Corporation, including any corporation which acquires all or
substantially all of the assets of the Corporation in one or more
transactions.
CAPITAL STOCK
ARTICLE VI
CERTIFICATES, CAPITAL STOCK
SECTION 1: All certificates of stock of the Corporation, both
preferred and common, shall be separately numbered and the facsimile signature
of the Chairman of the Board or the President or any Vice Chairman of the
Board, or a Vice President and the facsimile counter- signature of the
Treasurer, or an Assistant Treasurer, or the Secretary or an Assistant
Secretary and the facsimile seal of the Corporation shall appear thereon, all
in manner as authorized under the laws of the State of New York and approved
by the New York Stock Exchange.
TRANSFER AGENT AND REGISTRAR
SECTION 2: All certificates of stock of the Corporation shall be
issued only through a Transfer Agent of the Corporation's stock, consisting of
a Bank or Trust Company, duly appointed by the Board of Directors to act as
Transfer Agent and bear the counter-signature of the Registrar of the
Corporation's stock duly appointed by the Board of Directors to act as
Registrar. Endorsement to the foregoing effect shall be made upon all
certificates issued.
TRANSFER OF SHARES
SECTION 3: Shares of stock shall be transferable only on the books
of the Corporation by the holder thereof in person or pursuant to a power of
attorney duly executed and filed with the Transfer Agent, upon the surrender
of the certificate representing the shares to be transferred, properly
endorsed. All certificates surrendered for transfer shall be cancelled by the
Transfer Agent.
LOST, DESTROYED OR STOLEN CERTIFICATES
SECTION 4: No certificate for shares of stock of the Corporation
shall be issued in place of any certificate alleged to have been lost,
destroyed or stolen except on production of such evidence of such loss,
destruction or theft and on delivery to the Corporation, if the Board of
Directors shall so require, of a bond of indemnity upon such terms and secured
by such surety as the Board of Directors may in its discretion determine to be
satisfactory.
SEAL OF CORPORATION
SECTION 5: The seal of the Corporation shall be circular in form and
bear the words "GENERAL SIGNAL CORPORATION" next inside the line of its
circumference and the words "Incorporated June 13th, 1904" in the center
within the line of an inner circle.
AMENDMENTS
ARTICLE VII
SECTION 1: Except as otherwise provided by the Certificate of
Incorporation, any provision or provisions of these By-Laws, including any
amendment thereof, regardless of the manner in which any such provision or
amendment may have been adopted, may be deleted or amended in any respect at
any Annual Meeting of the shareholders, or at any Special Meeting called for
that purpose, by a majority of the votes cast at such meeting in person or by
proxy by the holders of shares entitled to vote thereon, or with the exception
of this Section 1 of Article VII, by a majority of the Board of Directors then
in office at any meeting thereof.
WAIVER OF NOTICE
ARTICLE VIII
SECTION 1: Any notice required by these By-Laws may be waived in
writing, either before or after the action requiring such notice is taken.
[CONFORMED AS EXECUTED]
364 DAY CREDIT AGREEMENT
dated as of January 12, 1994
among
GENERAL SIGNAL CORPORATION
and
VARIOUS COMMERCIAL BANKING INSTITUTIONS
TABLE OF CONTENTS
Page
ARTICLE I COMMITMENTS OF BANKS; BORROWING
PROCEDURES AND CONDITIONS
1.1. Commitments . . . . . . . . . . . . . . . . 1
1.1.1. Revolving Loan Commitments . . . . 1
1.1.2. Term Loan Commitments . . . . . . . 2
1.1.3. Domestic and Eurodollar
Loan Commitments . . . . . . . . 2
1.1.4. Commitment Limits . . . . . . . . . 2
1.1.5. Mandatory Reduction of the
Commitments . . . . . . . . . . . 3
1.1.6. Optional Pro Rata Reduction . . . . 3
1.1.7. Optional Non-Pro Rata Reduction . . 3
1.1.8. Increase in Commitments . . . . . . 4
1.2. Borrowing Procedures . . . . . . . . . . . . 5
1.3. Market Rate Loans . . . . . . . . . . . . 6
1.4. Conditions to Each Loan . . . . . . . . . . 7
ARTICLE II NOTES EVIDENCING LOANS
2.1. Revolving Notes . . . . . . . . . . . . . . 7
2.2. Term Notes . . . . . . . . . . . . . . . . . 8
2.3. Market Rate Notes . . . . . . . . . . . . . 8
ARTICLE III INTEREST AND FEES
3.1. Interest . . . . . . . . . . . . . . . . . . 8
3.1.1. Interest on Domestic Loans . . . . 9
3.1.1.1. Revolving Loans and
Term Loans . . . . . . . 9
3.1.1.2. Changes in Prime Rate . . 9
3.1.2. Interest on Eurodollar Loans . . . 9
3.1.2.1. Revolving Loans and
Term Loans . . . . . . . 10
3.1.2.2. After Maturity . . . . . 10
3.1.3. Notice of CD Rate or
Eurodollar Interest Rate . . . . 10
3.1.4. Rate Determination
Conclusive . . . . . . . . . . . 10
3.1.5. Increased Cost of Fixed
Rate Loans . . . . . . . . . . . 11
3.1.6. Interest on Market Rate Loans . . . 12
3.1.7. Additional Costs . . . . . . . . . 13
3.1.8. Applicable Margin . . . . . . . . . 14
3.2. Facility Fee . . . . . . . . . . . . . . . . 14
3.3. Basis of Computation . . . . . . . . . . . . 15
3.4. Extension of Due Date . . . . . . . . . . . 15
3.5. Interest Rate Determination . . . . . . . . 15
3.6. Currency Equivalents . . . . . . . . . . . . 16
ARTICLE IV PREPAYMENTS
4.1. Prepayment Upon Reduction or Termination
of the Credit . . . . . . . . . . . . . . 16
4.2. Change in Law Rendering Fixed Rate Loans
Unlawful . . . . . . . . . . . . . . . . . 17
4.3. Optional Prepayment . . . . . . . . . . . . 17
4.4. Interest on Principal Prepaid . . . . . . . 18
4.5. Prepayment Compensation . . . . . . . . . . 18
ARTICLE V SPECIAL PROVISIONS WITH RESPECT TO
CONTINUATION OF FIXED RATE LOANS
AND CONVERSION OF LOANS BETWEEN
EURODOLLARS AND DOMESTIC DOLLARS
5.1. Continuation of Eurodollar Loans . . . . . . 19
5.1.1. Continuation of CD Loans . . . . . 19
5.2. Conversion . . . . . . . . . . . . . . . . . 19
5.3. Restrictions on Borrower's Continuation and
Conversion Rights .. . . . . . . . . . . . 20
5.4. Notice of Continuations and Conversions . . 20
5.5. Interest Rate Unascertainable . . . . . . . 20
5.6. Bank Unable to Make Eurodollar Loan . . . . 21
5.7. Conversions Affecting Some Banks . . . . . . 21
ARTICLE VI MAKING AND PRORATION OF PAYMENTS;
OFFSET
6.1. Making of Payments . . . . . . . . . . . . . 22
6.2. Payment on Revolver Expiration Date . . . . 22
6.3. Allocation of Payments . . . . . . . . . . . 23
6.4. Proration of Other Recoveries . . . . . . . 24
6.5. Offset . . . . . . . . . . . . . . . . . . . 24
ARTICLE VII WARRANTIES
7.1. Organization, etc. . . . . . . . . . . . . . 25
7.2. Authorization; No Conflict . . . . . . . . . 25
7.3. Validity and Binding Nature . . . . . . . . 25
7.4. Financial Statements . . . . . . . . . . . . 25
7.5. Litigation . . . . . . . . . . . . . . . . . 26
7.6. Liens . .. . . . . . . . . . . . . . . . . . 26
7.7. ERISA . . . . . . . . . . . . . . . . . . . 26
7.8. Investment Company Act . . . . . . . . . . . 26
7.9. Public Utility Holding Company Act . . . . . 26
7.10. Regulations G, U, and X. . . . . . . . . . . 26
ARTICLE VIII COVENANTS
8.1. Reports, Certificates and Other
Information . . . . . . . . . . . . . . . 27
8.1.1. Audit Report ...... . . . . . . . . 27
8.1.2. Interim Reports . . . . . . . . . . 27
8.1.3. Certificates .. . . . . . . . . . . 28
8.1.4. Reports to SEC and to
Shareholders .. . . . . . . . . . 28
8.1.5. Notice of Default or Litigation . . 28
8.1.6. ERISA . . . . . . . . . . . . . . . 28
8.1.7. Other Information . . . . . . . . . 28
8.2. Books, Records and Inspections . . . . . . . 28
8.3. Insurance . . . . . . . . . . . . . . . . . 29
8.4. Taxes and Liabilities . . . . . . . . . . . 29
8.5. Purchase or Redemption of Borrower's
Securities; Dividend Restrictions . . . . 29
8.6. Liens . . . . . . . . . . . . . . . . . . . 29
8.7. Mergers and Consolidations . . . . . . . . . 31
8.8. Sale or Other Disposition of Assets . . . . 31
8.9. Interest Coverage and Consolidated
Debt to Consolidated Capitaliza-
tion . . . . . . . . . . . . . . . . . . . 32
ARTICLE IX CONDITIONS OF LENDING
9.1. Initial Revolving Loans . . . . . . . . . . 32
9.1.1. Revolving Note . . . . . . . . . . 32
9.1.2. Resolutions . . . . . . . . . . . . 32
9.1.3. Consents, etc.. . . . . . . . . . . 32
9.1.4. Incumbency and Signatures . . . . . 32
9.1.5. Opinion of Counsel to Borrower . . 33
9.1.6. Other . . . . . . . . . . . . . . . 33
9.2. All Revolving Loans . . . . . . . . . . . . 33
9.2.1. No Default. . . . . . . . . . . . . 33
9.2.2. Confirmatory Certificate . . . . . 33
9.2.3. Litigation . . . . . . . . . . . . 33
9.3. Initial Loan to Any Designated
Subsidiary . . . . . . . . . . . . . . . 34
9.3.1. Basic Documents . . . . . . . . . . 34
9.3.2. Designation.. . . . . . . . . . . . 34
9.3.3. Opinion of Counsel. . . . . . . . . 34
9.4. Term Loans . . . . . . . . . . . . . . . . . 34
ARTICLE X GUARANTEE
10.1 Unconditional Guarantee . . . . . . . . . . 34
10.2 Guarantee Absolute . . . . . . . . . . . . . 35
10.3 Waivers . . . . . . . . . . . . . . . . . . 35
10.4 Remedies . . . . . . . . . . . . . . . . . . 36
10.5 Survival . . . . . . . . . . . . . . . . . . 36
ARTICLE XI EVENTS OF DEFAULT AND THEIR EFFECT
11.1. Events of Default . . . . . . . . . . . . . 37
11.1.1. Non-Payment of Notes, etc. . . . . 37
11.1.2. Non-Payment of Other Indebtedness . 37
11.1.3. Bankruptcy, Insolvency, etc. . . . 37
11.1.4. Non-Compliance with
This Agreement. . . . . . . . . . 38
11.1.5. Warranties. . . . . . . . . . . . . 38
11.1.6. ERISA . . . . . . . . . . . . . . 38
11.2. Effect of Event of Default . . . . . . . . . 38
11.3. Defaults by Designated Subsidiaries . . . . 39
11.3.1. Warranties. . . . . . . . . . . . . 39
11.3.2. Non-Payment of Other Indebtedness . 39
11.3.3. Bankruptcy, Insolvency, etc. . . . . 39
11.3.4. Non-Compliance with This Agreement . 40
11.4. Effect of Default by Designated Subsidiary . . . 40
ARTICLE XII CERTAIN DEFINITIONS
"Alternate Currency" . . . . . . . . . . . . . . . . 41
"Alternate Currency Loan" . . . . . . . . . . . . . 41
"Alternate Currency Payment Office . . . . . . . . . 41
"Alternate Rating Agency" . . . . . . . . . . . . . 41
"Assuming Bank" . . . . . . . . . . . . . . . . . . 41
"Assumption Agreement" . . . . . . . . . . . . . . . 41
"Bank" . . . . . . . . . . . . . . . . . . . . . . . 41
"Bank Indemnitees" . . . . . . . . . . . . . . . . . 41
"Borrower" . . . . . . . . . . . . . . . . . . . . . 41
"Borrowing Date" . . . . . . . . . . . . . . . . . . 41
"Business Day" . . . . . . . . . . . . . . . . . . . 41
"CD Interest Period" . . . . . . . . . . . . . . . . 41
"CD Loan" . . . . . . . . . . . . . . . . . . . . . 42
"CD Margin" . . . . . . . . . . . . . . . . . . . . 42
"CD Rate" . . . . . . . . . . . . . . . . . . . . . 42
"Commitment" . . . . . . . . . . . . . . . . . . . . 42
"Commitment Increase" . . . . . . . . . . . . . . . 43
"Consolidated Capitalization" . . . . . . . . . . . 43
"Consolidated Cash Interest Expense" . . . . . . . . 43
"Consolidated Debt" . . . . . . . . . . . . . . . . 43
"Consolidated EBDIT" . . . . . . . . . . . . . . . . 43
"Consolidated Net Income" . . . . . . . . . . . . . 43
"Consolidated Net Worth" . . . . . . . . . . . . . . 44
"Consolidated Subsidiary" . . . . . . . . . . . . . 44
"Continuation Date" . . . . . . . . . . . . . . . . 44
"Conversion Date" . . . . . . . . . . . . . . . . . 44
"Credit" . . . . . . . . . . . . . . . . . . . . . 44
"Credit Suspension Event" . . . . . . . . . . . . . 44
"Current Market Price" . . . . . . . . . . . . . . . 44
"Depositary Bank" . . . . . . . . . . . . . . . . . 45
"Designated Subsidiary" . . . . . . . . . . . . . . 45
"Designation Letter" . . . . . . . . . . . . . . . . 45
"Dollars" and "$" . . . . . . . . . . . . . . . . . 45
"Domestic Loan" . . . . . . . . . . . . . . . . . . 45
"Equivalent Domestic Loan" . . . . . . . . . . . . . 45
"Eurodollar Day" . . . . . . . . . . . . . . . . . . 45
"Eurodollar Interest Rate" . . . . . . . . . . . . . 45
"Eurodollar Loan" . . . . . . . . . . . . . . . . . 45
"Eurodollar Margin" . . . . . . . . . . . . . . . . 45
"Eurodollar Office" . . . . . . . . . . . . . . . . 45
"Eurodollar Period" . . . . . . . . . . . . . . . . 45
"Event of Default" . . . . . . . . . . . . . . . . . 46
"Federal Funds Rate" . . . . . . . . . . . . . . . . 46
"Fixed Rate Interest Date" . . . . . . . . . . . . . 46
"Fixed Rate Loan" . . . . . . . . . . . . . . . . . 46
"GAAP" . . . . . . . . . . . . . . . . . . . . . . 46
"Increase Date" . . . . . . . . . . . . . . . . . . 47
"Indemnified Liabilities" . . . . . . . . . . . . . 47
"Interest Date" . . . . . . . . . . . . . . . . . . 47
"Interest Period" . . . . . . . . . . . . . . . . . 47
"Liabilities" . . . . . . . . . . . . . . . . . . . 47
"Loan" . . . . . . . . . . . . . . . . . . . . . . 47
(i) "Alternate Currency Loan" . . . . . 47
(ii) "CD Loan" . . . . . . . . . . . . . 47
(iii) "Domestic Loan" . . . . . . . . . 47
(iv) "Eurodollar Loan" . . . . . . . . 47
(v) "Fixed Rate Loan" . . . . . . . . 47
(vi) "Market Rate Loan" . . . . . . . . 47
(vii) "Prime Rate Loan" . . . . . . . . . 47
(viii) "Revolving Loan" . . . . . . . . . 47
(ix) "Term Loan" . . . . . . . . . . . . 47
"Market Rate" . . . . . . . . . . . . . . . . . . . 48
"Market Rate Loan" . . . . . . . . . . . . . . . . . 48
"Market Rate Note" . . . . . . . . . . . . . . . . . 48
"Notes" . . . . . . . . . . . . . . . . . . . . . . 48
"Obligations". . . . . . . . . . . . . . . . . . . . 48
"Percentage" . . . . . . . . . . . . . . . . . . . . 48
"Person" . . . . . . . . . . . . . . . . . . . . . . 48
"Prime Rate" . . . . . . . . . . . . . . . . . . . . 48
"Prime Rate Interest Date" . . . . . . . . . . . . . 48
"Prime Rate Loan" . . . . . . . . . . . . . . . . . 48
"Public Debt Rating. . . . . . . . . . . . . . . . . 48
"Reference Banks" . . . . . . . . . . . . . . . . . 49
"Regulation D" . . . . . . . . . . . . . . . . . . . 49
"Revolver Expiration Date" . . . . . . . . . . . . . 49
"Revolving Loan" . . . . . . . . . . . . . . . . . . 49
"Revolving Note" . . . . . . . . . . . . . . . . . . 49
"Significant Subsidiary" . . . . . . . . . . . . . . 49
"Subsidiary" . . . . . . . . . . . . . . . . . . . . 49
"Term Loan" . . . . . . . . . . . . . . . . . . . . 49
"Term Note" . . . . . . . . . . . . . . . . . . . . 49
ARTICLE XIII GENERAL
13.1. Waiver; Amendments . . . . . . . . . . . . . 49
13.2. Confirmations . . . . . . . . . . . . . . . 50
13.3. Notices . . . . . . . . . . . . . . . . . . 50
13.4. Accounting Terms and Determinations . . . . . . . 51
13.5. Participations; Transfers of Notes . . . . . 51
13.6. Regulation U . . . . . . . . . . . . . . . . 53
13.7. Confidentiality of Information . . . . . . . 53
13.8. Limitation on Interest . . . . . . . . . . . 54
13.9. Costs, Expenses and Taxes . . . . . . . . . 54
13.10. Designated Subsidiaries . . . . . . . . . . 54
13.11. Captions . . . . . . . . . . . . . . . . . . . . 55
13.12. Governing Law; Submission to
Jurisdiction . . . . . . . . . . . . . . . 55
13.13. Counterparts . . . . . . . . . . . . . . . . 55
13.14. Effectiveness . . . . . . . . . . . . . . . 55
13.15. Successors and Assigns . . . . . . . . . . . 56
13.16. Duties of Depositary Bank . . . . . . . . . 56
13.17. Severability . . . . . . . . . . . . . . . . 56
13.18. Representation of the Banks . . . . . . . . 56
13.19. Survival . . . . . . . . . . . . . . . . . . 57
13.20. Waiver of Trial by Jury . . . . . . . . . . 57
EXHIBITS
Exhibit A -- Form of Revolving Note
Exhibit B -- Form of Term Note
Exhibit C -- Form of Market Rate Note
Exhibit D -- Form of Opinion of Counsel to the Company
Exhibit E -- Form of Designation Letter
Exhibit F -- Form of Opinion of Counsel for each Borrower
364 DAY CREDIT AGREEMENT
THIS 364 DAY CREDIT AGREEMENT, dated as of January 12,
1994 (the "Agreement"), among GENERAL SIGNAL CORPORATION, a New
York corporation (the "Company"), each other Borrower hereunder,
and the undersigned commercial banking institutions (herein
called collectively "Banks").
W I T N E S S E T H:
WHEREAS, the Company desires by this Agreement
(capitalized terms being used herein with the meanings
respectively ascribed to them in Article XII) to obtain
commitments for revolving credit loans to be made in an aggregate
outstanding principal amount not to exceed $160,000,000 on or
prior to the Revolver Expiration Date and to provide for the
making of Market Rate Loans by the several Banks; and
WHEREAS, Banks are willing, severally and not jointly,
upon the terms and conditions hereinafter set forth, to extend
such revolving loan commitments and to make loans pursuant
thereto and to make non-committed Market Rate Loans for general
working capital and other corporate purposes (including, without
limitation, acquisitions and the purchase of securities and
assets, including repurchases of the Company's securities);
NOW, THEREFORE, in consideration of the agreements
herein contained, the parties hereto hereby agree as follows:
ARTICLE I
COMMITMENTS OF BANKS; BORROWING PROCEDURES AND CONDITIONS
SECTION 1.1. Commitments. Subject to the terms and
conditions of this Agreement, each Bank severally agrees to make
Revolving Loans hereunder to any Borrower up to the maximum
amounts specified in Section 1.1.4 as follows:
SECTION 1.1.1. Revolving Loan Commitments. Loans on
a revolving basis (i.e., subject to the terms and conditions of
this Agreement, Revolving Loans may be borrowed, prepaid, repaid
and re-borrowed) from time to time on or before the Revolver
Expiration Date to any Borrower equal to such Bank's Percentage
of the aggregate amount of such Revolving Loan (each herein
called a "Revolving Loan") except as each Bank's obligation to
make Revolving Loans may be created or modified as provided in
this Section 1.1 and Section 13.5.
SECTION 1.1.2. Term Loan Commitments. A loan (herein
called a "Term Loan") on the Revolver Expiration Date in such
Bank's Percentage of such aggregate amount as Borrower may
request from all Banks, such aggregate amount not to exceed the
amount of the Credit.
SECTION 1.1.3. Domestic and Eurodollar Loan
Commitments. Subject to the terms and conditions of this
Agreement, each Revolving Loan and each Term Loan shall be either
a Domestic Loan or a Eurodollar Loan, as Borrower shall request
in the relevant notice of borrowing pursuant to Section 1.2 or
5.4, it being understood that both Domestic Loans and Eurodollar
Loans may be outstanding at the same time. As to any Eurodollar
Loan or Domestic Loan, each Bank may, if it so elects (which
election shall be made by such Bank in a manner consistent with
its undertaking contained in Section 5.7 and otherwise in good
faith with a view to not increasing unnecessarily the obligations
of any Borrower hereunder), fulfill its aforesaid commitment by
causing a foreign branch or affiliate of such Bank (such foreign
branch or affiliate or any U.S. branch or affiliate from which a
Bank funds a Eurodollar Loan herein called such Bank's
"Eurodollar Office") to make such Loan, provided that in such
event for the purposes of this Agreement such Eurodollar Loan
shall be deemed to have been made by such Bank, and the
obligation of Borrower to repay such Eurodollar Loan shall
nevertheless be to such Bank and shall be deemed held by it, to
the extent of such Eurodollar Loan, for the account of such
branch or affiliate.
SECTION 1.1.4. Commitment Limits. The aggregate
principal amount of Revolving Loans and Term Loans which any Bank
shall be committed to lend to Borrower shall not at any one time
exceed such Bank's Commitment; and the aggregate amount of the
Credit shall not at any one time exceed $160,000,000 (or such
greater or lesser amount as may be determined pursuant to this
Section 1.1). Except as may be otherwise required by Section
5.6, no Bank's obligation to make any Revolving Loan or Term Loan
shall, the ratability provisions of Section 1.1.3 to the contrary
notwithstanding, be affected by any other Bank's failure or
inability to make any Revolving Loan or Term Loan.
SECTION 1.1.5. Mandatory Reduction of the Commitments.
On the Revolver Expiration Date the Commitment of each Bank shall
be reduced to zero; provided that on the Revolver Expiration Date
any Borrower may borrow a Term Loan pursuant to Section 1.2. The
aggregate amount of the Commitments of the Banks once reduced
pursuant to this Section 1.1.5 may not be reinstated.
SECTION 1.1.6. Optional Pro Rata Reduction. The
Company shall have the right, at any time or from time to time,
upon not less than three Business Days' prior notice to the
Depositary Bank (and the Depositary Bank shall promptly notify
each Bank of each termination or reduction) to terminate or
reduce, in whole or in part, on a pro rata basis the unused
portions of the respective Commitments of the Banks, provided
that each partial reduction shall be in an aggregate principal
amount of $5,000,000 or a multiple thereof. The aggregate amount
of the Commitments of the Banks once reduced pursuant to this
Section 1.1.6 may not be reinstated, except pursuant to Section
1.1.8.
SECTION 1.1.7. Optional Non-Pro Rata Reduction. The
Company shall have the right, upon not less than five Business
Days' prior notice to a Bank (with a copy to the Depositary
Bank), to terminate in whole such Bank's Commitment; provided,
that at the time such notice of termination is given (A) no
Credit Suspension Event has occurred and is continuing and
(B) either (i) the Public Debt Rating of the Company is A-/A3 or
higher or (ii) concurrently with the termination of such Bank's
Commitment a Commitment Increase becomes effective pursuant to
Section 1.1.8 in an amount not less than the Commitments
concurrently being terminated pursuant to this Section 1.1.7.
Such termination shall be effective, (A) with respect to such
Bank's unused Commitment, on the date set forth in such notice,
provided, however, that such date shall be no earlier than ten
Business Days after receipt of such notice and (B) with respect
to each Loan outstanding to such Bank, on the last day of the
then current Interest Period relating to such Loan. Upon
termination of a Bank's Commitment under this Section 1.1.7, the
Company will pay or cause to be paid all principal of, and
interest accrued to the date of such payment on Loans owing to
such Bank and pay any facility fees or other fees payable to such
Bank pursuant to Section 3.2, and all other amounts payable to
such Bank hereunder; and upon such payments, the obligations of
such Bank hereunder shall, by the provisions hereof, be released
and discharged. The aggregate amount of the Commitments of the
Banks once reduced pursuant to this Section 1.1.7, may not be
reinstated, except pursuant to Section 1.1.8.
SECTION 1.1.8. Increase in Commitments. The Company
may at any time, by notice to the Depositary Bank, propose that
the aggregate of the Commitments be increased in excess of the
aggregate of the Commitments then in effect (a "Commitment
Increase"), effective as of a date prior to the Revolver
Expiration Date (the "Increase Date") as to which agreement is to
be reached by an earlier date specified in such notice (the
"Commitment Date"); provided, however, that (A) the minimum
proposed Commitment Increase per notice shall be in an amount no
less than $5,000,000, (B) no Event of Default has occurred and is
continuing and (C) the warranties of the Company in Article VII
shall be true and correct in all material respects with the same
effect as if made on such Increase Date. The Depositary Bank
shall notify the Banks thereof promptly upon its receipt of any
such notice. If agreement is reached on or prior to the
Commitment Date with one or more Banks and Assuming Banks, if
any, as to a Commitment Increase (which may be less than
specified in the applicable notice from the Company), such
agreement to be evidenced by a notice in reasonable detail from
the Company to the Depositary Bank on or prior to the Commitment
Date, the Assuming Banks, if any, shall become Banks hereunder as
of the Increase Date and the Commitments of such Banks and such
Assuming Banks shall become or be, as the case may be, as of the
Increase Date the amounts specified in such notice (and the
Depositary Bank shall give notice thereof to the Banks (including
such Assuming Banks)); provided, however, that:
(a) the Depositary Bank shall have received (with
copies for each Bank, including each Assuming Bank), on or
prior to the Increase Date, an opinion of counsel for the
Company in substantially the form of Exhibit D hereto and an
opinion of counsel for each other Borrower substantially in
the form of Exhibit F hereto, dated such Increase Date,
together with a copy, certified on the Increase Date by the
Secretary or an Assistant Secretary of the pertinent
Borrower, of the resolutions adopted by the Board of
Directors of the Company and each such other Borrower
authorizing such Commitment Increase;
(b) each such Assuming Bank shall have delivered, on
or prior to the Increase Date, to the Depositary Bank an
appropriate Assumption Agreement; and
(c) each Bank which proposes to increase its
Commitment in connection with such Commitment Increase shall
have delivered, on or prior to the Increase Date,
confirmation in writing satisfactory to the Depositary Bank
as to its increased Commitment.
In the event that the Depositary Bank shall not have received
notice from the Company as to such agreement on or prior to the
Commitment Date or the Company shall, by notice to the Depositary
Bank prior to the Increase Date, withdraw such proposal or any of
the actions provided for above in clauses (a) through (c) of this
Section 1.1.8. shall not have occurred by the Increase Date, such
proposal by the Company shall be deemed not to have been made.
In such event, the actions theretofore taken under clauses (a)
through (c) of this Section 1.1.8., shall be deemed to be of no
effect and all the rights and obligations of the parties shall
continue as if no such proposal had been made.
Following any Commitment Increase, the Borrower shall
be deemed to repay and reborrow each Revolving Loan having an
Interest Period commencing prior to such Increase Date on the
date of the continuation or conversion of any Revolving Loan that
is a Fixed Rate Loan or the next Interest Date for any Revolving
Loan that is a Prime Rate Loan.
SECTION 1.2. Borrowing Procedures. Borrower shall
provide The Chase Manhattan Bank, N.A. (herein called "Depositary
Bank"), with notice (of which Depositary Bank shall give prompt
notice to each other Bank), by 10:00 a.m. New York City time on
the day of a proposed borrowing of Prime Rate Loans, at least two
Business Days prior to each proposed borrowing of CD Loans or at
least three Eurodollar Days prior to each proposed borrowing of
Eurodollar Loans, as the case may be, of the date and amount of
such borrowing (except that if the Term Loan borrowing shall
comprise both Domestic and Eurodollar Loans, there shall be a
single notice at least three Eurodollar Days prior to such
proposed borrowing), the interest rate applicable thereto and, in
the case of a Eurodollar Loan or CD Loan, the duration of the
initial Interest Period. Each Bank shall provide Depositary Bank
at its address set forth below its signature hereto, by not later
than 12:30 p.m., New York City time, on the date of a proposed
borrowing, with immediately available funds covering such Bank's
Percentage of the borrowing (or, in the case of the Term Loan
borrowing, of any excess of the aggregate Term Loan borrowing
over the aggregate principal amount of the Revolving Loans then
outstanding plus accrued interest unpaid at the Revolver
Expiration Date), and Depositary Bank shall pay over such
immediately available funds to Borrower upon each Bank's
(including, without limitation, Depositary Bank's) receipt of the
documents required under Article IX with respect to such
borrowing. Each borrowing hereunder shall be in an aggregate
amount that is an integral multiple of $1,000,000 and at least
$5,000,000.
SECTION 1.3. Market Rate Loans. (a) Notwithstanding
any provisions of this Agreement to the contrary, any Bank may,
from time to time, make Market Rate Loans denominated in Dollars
or in any Alternate Currency to any Borrower bearing interest at
such rate (hereinafter called such Bank's "Market Rate") of
interest as may be agreed upon by the Borrower and such Bank.
Each Bank may in its sole discretion negotiate with any Borrower
concerning the offering of Loans at a Market Rate (hereinafter
called "Market Rate Loans"); provided, that nothing contained in
this Agreement shall be deemed to require any Bank to offer
Market Rate Loans to any Borrower. In the event that any
Borrower and any Bank agree to the making of a Market Rate Loan,
such Market Rate Loan shall be made severally by such Bank
directly to such Borrower without participation in such Market
Rate Loan by any other Bank. Such Market Rate Loan may be on
such further terms and conditions, including the right of the
Borrower to prepay such Market Rate Loan, as may be agreed upon
by the Borrower and such Bank.
(b) Notwithstanding anything to the contrary contained
in this Agreement, all payments or prepayments made in respect of
Market Rate Loans made by a Bank pursuant to Section 1.3(a) shall
be made directly to such Bank, and such Bank shall not be subject
to the provisions of Section 6.3 or 6.4 in respect of any such
payments so received.
(c) Upon the making of, or any repayment of principal
of, any Market Rate Loan, Borrower shall give the Depositary Bank
prompt written, facsimile or telephonic notice of such Market
Rate Loan or repayment, which notice shall state the Borrower,
the principal amount of such Market Rate Loan or the amount of
such repayment, the maturity date of such Market Rate Loan (if
applicable) and, if such Market Rate Loan is an Alternate
Currency Loan, the Alternate Currency, the Dollar equivalent of
the principal amount thereof and the Alternate Currency Payment
Office.
(d) Market Rate Loans shall not be subject to the
limitations on the aggregate amount of the Credit as provided in
Section 1.1.4 and shall not reduce the amount of any Bank's
unused Commitment.
(e) The Company shall designate for each Alternate
Currency in which any Borrower proposes to borrow an Alternate
Currency Loan an office of a bank at which the proceeds of
Alternate Currency Loans denominated in such Alternate Currency
will be made available to Borrower and payments in such Alternate
Currency will be made (an "Alternate Currency Payment Office") by
written notice to Depositary Bank. Any Borrower and any Bank
making a Market Rate Loan that is an Alternate Currency Loan may
agree upon a different Alternate Currency Payment Office with
respect to such Market Rate Loan. The Company or Borrower shall
provide the Depositary Bank with written notice of any such
designation.
SECTION 1.4. Conditions to Each Loan. Notwithstanding
any other provision of this Agreement, no Revolving Loan or Term
Loan shall be required to be made hereunder if the conditions
precedent to the making of such Loan specified in Article IX have
not been satisfied.
ARTICLE II
NOTES EVIDENCING LOANS
SECTION 2.1. Revolving Notes. The Revolving Loans of
each Bank shall be evidenced by a promissory note (herein called
a "Revolving Note") substantially in the form set forth in
Exhibit A, with appropriate insertions, payable to the order of
such Bank on the Revolver Expiration Date in the principal amount
equal to the amount of such Bank's Commitment or in the aggregate
unpaid principal amount of all of its Revolving Loans, whichever
is less. The date and amount of each Revolving Loan made by such
Bank and of each repayment of principal thereof received by such
Bank, and, in the case of each Eurodollar Loan or CD Loan, the
dates on which each Interest Period as to such Loan shall begin
and end, shall be recorded by such Bank on the schedule attached
to the Revolving Note issued to such Bank, and the aggregate
unpaid principal amount shown on such schedule shall be
conclusive evidence absent demonstrable error of the principal
amount owing and unpaid on such Revolving Note. The failure to
record any such amount on such schedule shall not, however, limit
or otherwise affect the obligations of Borrower hereunder or
under any Note to repay the principal amount of the Loans
together with all interest accruing thereon or any other amount
owing hereunder. Each Revolving Loan shall be repaid on the
Revolver Expiration Date, subject to the right of Borrower to
prepay such Revolving Loan and, prior to the Revolver Expiration
Date, to reborrow hereunder, in accordance with the provisions of
this Agreement.
SECTION 2.2. Term Notes. The Term Loan of each Bank
shall be evidenced by a promissory note (herein called a "Term
Note") substantially in the form set forth in Exhibit B, with
appropriate insertions, dated the Revolver Expiration Date,
payable to the order of such Bank in the original principal
amount of such Term Loan on the date which is one year after the
Revolver Expiration Date.
SECTION 2.3. Market Rate Notes. A Market Rate Loan
made by any Bank to Borrower shall be evidenced by a promissory
note (herein called a "Market Rate Note") substantially in the
form set forth in Exhibit C, with appropriate insertions, and
containing such other terms as the Borrower and such Bank may
agree.
ARTICLE III
INTEREST AND FEES
SECTION 3.1. Interest. Subject to the provisions of
Section 4.4, (i) interest prior to maturity (whether by
acceleration or otherwise) on each Prime Rate Loan shall be
payable in arrears on the last day of each March, June, September
and December and on the Revolver Expiration Date (herein, subject
to the requirements of Section 3.4, and including the final
maturities, by acceleration or otherwise, of all of the Revolving
Loans, called a "Prime Rate Interest Date"), and (ii) interest
prior to maturity on each Eurodollar Loan and CD Loan shall be
payable on the last day of the Interest Period for such Loan
(herein called a "Fixed Rate Interest Date"). Interest from and
after maturity (whether by acceleration or otherwise) on all
Loans shall be payable on demand. Interest on each Loan shall
accrue from and including the Borrowing Date thereof, but shall
not accrue on any principal amount of such Loan for the day on
which such principal amount is paid. For purposes of the
foregoing computations, a conversion of Eurodollar Loans to
Domestic Loans or of Domestic Loans to Eurodollar Loans, or a
conversion of CD Loans to Prime Rate Loans or of Prime Rate Loans
to CD Loans, or a continuation of Eurodollar Loans or CD Loans,
pursuant to Article V shall be deemed to comprise a payment of
principal together with the making of a concurrent Loan.
SECTION 3.1.1. Interest on Domestic Loans. Interest
on the unpaid portion of the principal amount of Domestic Loans
shall accrue until paid with respect to each Bank at the
following rates per annum:
SECTION 3.1.1.1. Revolving Loans and Term Loans.
(i) Prior to maturity, at a rate equal to the Prime Rate, from
time to time in effect, or the CD Rate, as the Borrower has
specified in its notice of borrowing pursuant to Section 1.2
hereof; and (ii) after maturity, whether by acceleration or
otherwise, until paid, at a rate equal to the sum of the Prime
Rate, in effect from time to time, plus 1%.
SECTION 3.1.1.2. Changes in Prime Rate. The
applicable interest rate on Prime Rate Loans shall change
simultaneously with the effectiveness of each change in the Prime
Rate.
SECTION 3.1.2. Interest on Eurodollar Loans. Interest
on the unpaid principal amount of each Eurodollar Loan shall
accrue at a rate per annum (herein called the "Eurodollar
Interest Rate") calculated for each Eurodollar Period as follows:
SECTION 3.1.2.1. Revolving Loans and Term Loans. The
Eurodollar Interest Rate for each Eurodollar Period shall be a
rate per annum which is equal to the sum of the Eurodollar Margin
in effect on the first day of the applicable Eurodollar Period
plus the rate obtained by dividing (i) the arithmetic average
(rounded to the nearest whole multiple of 1/16 of 1%) of the
rates per annum calculated by Depositary Bank on the basis of
notification from the Reference Banks at which Dollar deposits
are offered to each Reference Bank by prime banks in the London
Interbank Eurodollar market in immediately available funds at
11:00 a.m., London time, two Eurodollar Days before the beginning
of such Eurodollar Period for a period comparable to such
Eurodollar Period and in a principal amount comparable to the
Eurodollar Loan of such Reference Bank for such Eurodollar Period
divided (and rounded to the nearest whole multiple of 1/16 of 1%)
by (ii) a percentage equal to 100% minus the then stated maximum
rate of all reserve requirements (including without limitation
any marginal, emergency, supplemental, special or other reserves)
applicable to any member bank of the Federal Reserve System in
respect of Eurocurrency liabilities as defined in Regulation D of
the Board of Governors of the Federal Reserve System (herein
called "Regulation D") or any successor category of liabilities
under Regulation D.
SECTION 3.1.2.2. After Maturity. In the event of
default by any Borrower in the payment when due (whether by
acceleration or otherwise) of part or all of the principal amount
of any Eurodollar Loan, such Borrower shall pay interest on such
unpaid amount from the date such amount shall have become due to
the date of actual payment, accruing on a daily basis, at a rate
per annum (i) in the event such default shall occur prior to the
scheduled expiration of the Eurodollar Period for such Loan, then
during the remaining portion of such Eurodollar Period, equal to
1% plus the Eurodollar Interest Rate for such Eurodollar Period
of such Loan during which such default occurred and (ii) after
the expiration of the Eurodollar Period for such Loan (or
expiring concurrently with such default) equal to the Prime Rate,
from time to time in effect, plus 1%.
SECTION 3.1.3. Notice of CD Rate or Eurodollar
Interest Rate. The CD Rate for each CD Interest Period and the
Eurodollar Interest Rate for each Eurodollar Period shall be
determined by Depositary Bank as provided herein and notice
thereof (including a calculation in reasonable detail) shall be
given by Depositary Bank promptly to each Bank and to the
Company.
SECTION 3.1.4. Rate Determination Conclusive. Each
calculation of the Eurodollar Interest Rate or the CD Rate,
furnished to the Banks and to the Company by Depositary Bank
pursuant to Section 3.1.3 shall, unless objected to by any Bank
or the Company within 30 days thereafter, be conclusive and
binding upon the parties hereto, in the absence of demonstrable
error. If any one or more of the Reference Banks is unable or
for any reason fails to notify Depositary Bank of the applicable
interest rate on the day specified in Section 3.1.2.1, in the
case of a Eurodollar Loan, or in the definition of "CD Rate", in
the case of a CD Loan, by 9:00 p.m., London time in the case of
a Eurodollar Loan and 4:00 p.m., New York City time in the case
of a CD Loan, the applicable Eurodollar Interest Rate or CD Rate,
as the case may be, shall be determined on the basis of the rate
or rates of which Depositary Bank is given notice by the
remaining Reference Bank or Banks by such time. If none of the
Reference Banks is able to notify Depositary Bank of such a rate,
the provisions of clauses (a), (b) and (c) of Section 5.5 shall
apply.
SECTION 3.1.5. Increased Cost of Fixed Rate Loans.
Borrower agrees to pay directly to each Bank additional amounts
as will compensate such Bank for (i.e., make such Bank whole
against, but only to the extent and for the duration of) (i) any
increase in the cost to such Bank of making or maintaining any
Eurodollar Loan or CD Loan hereunder, or of its obligation to
make or maintain any Eurodollar Loans or CD Loans hereunder, or
(ii) any reduction in the amount of any sum receivable by such
Bank hereunder in respect of any Eurodollar Loan or CD Loan, from
time to time, by reason of:
(a) any reserve, special deposit, or similar
requirements against assets of, deposits with or for the
account of or credit extended by, such Bank which are
imposed on, or deemed applicable by, such Bank, under or
pursuant to any law, treaty, rule, regulation (including,
without limitation, Regulation D) or requirement in effect
on or after the date hereof, any change therein, or any
interpretation thereof by any governmental authority charged
with administration thereof or by any central bank or other
fiscal, monetary or other authority having jurisdiction over
the CD Loans, the Eurodollar Loans, such Bank, or a
Eurodollar Office which is a foreign branch or affiliate of
such Bank, or any requirement imposed by any central bank or
such other authority, whether or not having the force of
law; or
(b) any change in (including the introduction of any
new) applicable law, treaty, rule, regulation or requirement
or in the interpretation thereof by any official authority,
or the imposition of any requirement of any central bank,
whether or not having the force of law, which shall subject
such Bank or Borrower to any tax (other than taxes on net
income or net worth or franchise taxes), levy, impost,
charge, fee, duty, deduction or withholding of any kind
whatsoever or change the taxation of a Eurodollar Office
which is a foreign branch or affiliate of such Bank with
respect to any Eurodollar Loan of such Bank hereunder and
the interest thereon (other than any change which affects,
and to the extent that it affects, the taxation of net
income);
provided, however, that no Bank shall seek compensation for any
such increase in cost, or for any such reduction in the amount of
any sum receivable, for any period when any Eurodollar Loan or CD
Loan shall be outstanding if such Bank shall, on or prior to the
date of making such Eurodollar Loan or CD Loan, have notified the
Borrower that it will not seek compensation therefor and will not
give notice thereof in accordance with the following paragraph of
this Section; provided, further, that the Borrower shall not be
required to pay any additional amount on account of any taxes
imposed by the United States pursuant to this Section 3.1.5. to
any Bank which (i) is not entitled, on the date hereof (or, in
the case of an assignee of a Bank, on the date on which the
assignment to it became effective), to submit Form 1001 or Form
4224 (or any successor forms) so as to meet its obligations to
submit such a form pursuant to Section 13.18 or Section 13.5, or
(ii) shall have failed to submit any form or other certification
which it was required to file pursuant to Section 13.18 or
Section 13.5 and entitled to file under applicable law, or (iii)
shall have filed any such form which is incorrect or incomplete
in any material respect.
In any such event, each Bank so affected shall promptly notify
Borrower and Depositary Bank (which shall give prompt notice
thereof to each other Bank) thereof by telephone, confirmed in
writing, stating the reasons therefor and the additional amounts
required fully to compensate such Bank for such increased cost or
reduced amount. Such additional amounts shall be payable on the
Fixed Rate Interest Date of each Eurodollar Loan and CD Loan so
affected, and upon demand if such notice is not given to Borrower
prior to such Fixed Rate Interest Date or if there are no
Eurodollar Loans or CD Loans outstanding when such notice is
given, provided that such compensation will cover a period
beginning not more than 90 days prior to such notice. A
certificate as to any such increased cost or reduced amount
(including calculations, in reasonable detail, showing how such
Bank computed such cost or reduction) shall be submitted by each
affected Bank to Borrower and Depositary Bank (which shall
promptly furnish copies thereof to each other Bank) and shall, in
the absence of demonstrable error, be conclusive and binding.
SECTION 3.1.6. Interest on Market Rate Loans. The
applicable interest rate, and the time of payment therefor, for
each Market Rate Loan shall be as agreed upon by Borrower and the
Bank making such Market Rate Loan.
SECTION 3.1.7. Additional Costs. Without limiting the
effect of the foregoing provisions of Section 3.1.5 (but without
duplication), the Borrower shall pay directly to each Bank from
time to time on demand such amounts as such Bank may determine to
be necessary to compensate such Bank for any costs which such
Bank determines are attributable to any Revolving Loan
outstanding hereunder or to its obligation to make any Revolving
Loans hereunder and to other loans or commitments of this type in
respect of any amount of capital maintained by such Bank or any
of its affiliates pursuant to any law or regulation of any
jurisdiction, or any change therein, or any interpretation,
guidelines, directive or request (whether or not having the force
of law) of any court or governmental or monetary authority,
whether in effect on the date of this Agreement or thereafter.
Without limiting the foregoing, such compensation shall include
an amount equal to any reduction in return on assets or return on
equity to a level below that which such Bank could have achieved
but for such law, regulation, change, interpretation, directive
or request; provided, however, that no Bank shall seek
compensation for any such increase in cost, or for any such
reduction in the amount of any sum receivable, in respect of any
Revolving Loan outstanding hereunder for any period when any
Revolving Loan shall be outstanding if such Bank shall, on or
prior to the date of making such Revolving Loan, have notified
the Borrower that it will not seek compensation therefor and will
not give notice thereof in accordance with the following
paragraph of this Section.
In any such event, each Bank so affected shall promptly notify
the Company and Depositary Bank (which shall give prompt notice
thereof to each other Bank) thereof by telephone, confirmed in
writing, stating the reasons therefor and the additional amounts
required fully to compensate such Bank for such increased cost or
reduced amount. Such additional amounts shall be payable on the
next Interest Date, or upon demand if there are no Loans
outstanding when such notice is given, provided that such
compensation will cover a period beginning not more than 90 days
prior to such notice. A certificate as to any such increased
cost or reduced amount (including calculations, in reasonable
detail, showing how such Bank computed such cost or reduction)
shall be submitted by each affected Bank to Borrower and
Depositary Bank (which shall promptly furnish copies thereof to
each other Bank) and shall, in the absence of demonstrable error,
be conclusive and binding.
SECTION 3.1.8. Applicable Margin. The "Eurodollar
Margin" or "CD Margin" means, as of any date, with respect to any
Eurodollar Loan or CD Loan, respectively, the applicable
percentage set opposite the Public Debt Rating in effect on such
date:
Public Debt Rating Eurodollar Margin CD Margin
Level 1:
AA-/Aa3 0.1875% 0.3125%
or higher
Level 2:
A-/A3 or higher, but 0.25% 0.375%
less than Level 1
Level 3:
BBB-/Baa3 or higher, 0.40% 0.525%
but less than Level 2
Level 4:
Less than BBB-/Baa3 0.75% 0.875%
Any adjustment to the Eurodollar Margin or CD Margin
pursuant to this Section 3.1.8 shall become effective for
Interest Periods commencing after a public announcement of a
change in debt rating which requires an adjustment to be made
hereunder.
SECTION 3.2. Facility Fee. Borrower agrees to pay the
Banks a facility fee for the period from and including
January 12, 1994 to the later of the Revolver Expiration Date or
the repayment of all Revolving Loans and Term Loans in full,
equal to the percentage per annum set forth for the applicable
Public Debt Rating in the table below on the daily average amount
of the Credit; provided that no facility fee shall be payable to
any Bank on that portion of the Credit then borrowed as Prime
Rate Loans as a result of a conversion of any Fixed Rate Loan
pursuant to Section 4.2, 5.5, 5.6 or 5.7.
Public Debt Rating Facility Fee Percentage
Level 1:
AA-/Aa3 or higher 0.08%
Level 2:
A-/A3 or higher, 0.125%
but less than Level 1
Level 3:
BBB-/Baa3 or higher, 0.15%
but less than Level 2
Level 4:
Less than BBB-/Baa3 0.175%
Such facility fee shall be payable on the last day of
March, June, September and December for the period then ending
for which such facility fee shall not have been theretofore paid
(the first such payment to be made on March 31, 1994) and on the
earlier of the Revolver Expiration Date or the date of
termination of the Credit for any period then ending for which
such facility fee shall not have been theretofore paid.
SECTION 3.3. Basis of Computation. Interest on Prime
Rate Loans and the facility fee shall be computed for the actual
number of days elapsed on the basis of a year consisting of 365
or, if applicable, 366 days. Interest on Fixed Rate Loans shall
be computed for the actual number of days elapsed on the basis of
a year consisting of 360 days. Interest on each Market Rate Loan
shall be computed on the same basis as Fixed Rate Loans unless
otherwise agreed upon by Borrower and the Bank making such Market
Rate Loan.
SECTION 3.4. Extension of Due Date. If any payment of
principal of, or interest on, any Domestic Loan or any payment of
a facility fee falls due on a day which is not a Business Day,
then such due date shall be extended to the next following
Business Day. If any payment of principal of, or interest on,
any Eurodollar Loan falls due on a day which is not a Eurodollar
Day, then such due date shall be extended to the next Eurodollar
Day, unless such Eurodollar Day falls in another calendar month,
in which case the date for payment thereof shall be the preceding
Eurodollar Day. If the date for any payment of principal is
extended pursuant to this Section 3.4 additional interest shall
accrue and be payable for the period of such extension.
SECTION 3.5. Interest Rate Determination. Each
Reference Bank agrees to furnish to the Depositary Bank timely
information for the purpose of determining each Prime Rate, CD
Rate or Eurodollar Rate, as applicable. If any one or more of
the Reference Banks shall not furnish such timely information to
the Depositary Bank for determination of any such interest rate,
the Depositary Bank shall determine such interest rate on the
basis of timely information furnished by the remaining Reference
Banks. The Depositary Bank shall give prompt notice to the
Borrower and, if different, the Company and the Banks of the
applicable interest rate determined by the Depositary Bank and of
the applicable rate, if any, furnished by each Reference Bank for
determining the applicable interest rate under Section 3.1.
SECTION 3.6. Currency Equivalents. For purposes of
the provisions of Articles I, II, III, IV and V, (i) the
equivalent in Dollars of any Alternate Currency shall be
determined by using the quoted spot rate at which the principal
office in New York City of the pertinent Bank or the principal
office in New York City of any affiliate of such Bank offers to
exchange Dollars for such Alternate Currency in New York City at
11:00 a.m. (New York City time), two Business Days prior to the
date on which such equivalent is to be determined, (ii) the
equivalent in any Alternate Currency of any other Alternate
Currency shall be determined by using the quoted spot rate at
which such Bank's principal office in New York City or the
principal office in New York City of any affiliate of such Bank
offers to exchange such Alternate Currency for the equivalent in
Dollars of such other Alternate Currency in New York City at
11:00 a.m. (New York City time), two Business Days prior to the
date on which such equivalent is to be determined, and (iii) the
equivalent in any Alternate Currency of Dollars shall be
determined by using the quoted spot rate at which such Bank's
principal office in New York City or the principal office in New
York City of any affiliate of such Bank offers to exchange such
Alternate Currency for Dollars in New York City at 11:00 a.m.
(New York City time), two Business Days prior to the date on
which such equivalent is to be determined.
ARTICLE IV
PREPAYMENTS
SECTION 4.1. Prepayment Upon Reduction or Termination
of the Credit. On the effective date of any reduction of the
Commitments pursuant to Section 1.1.6 Borrower shall prepay the
amount, if any, by which the aggregate unpaid principal amount of
all Revolving Notes exceeds the then reduced amount of the
Credit; provided, that on the later of the termination of the
Commitments in their entirety or the maturity of the Term Loan,
if made, each Borrower shall pay in full all of its obligations
hereunder and under the Notes accrued or payable through such
date (all such obligations being herein collectively called the
"Liabilities").
SECTION 4.2. Change in Law Rendering Fixed Rate Loans
Unlawful. In the event that any change in (including the
introduction of any new) applicable laws or regulations, or in
the interpretation thereof by any governmental or other
regulatory authority charged with the administration thereof,
shall make it unlawful for any Bank to make or continue any
Eurodollar Loan or CD Loan to be made or continued by it
hereunder, the obligation of such Bank pursuant to which such
Eurodollar Loan or CD Loan would otherwise be made shall, upon
the happening of such event, forthwith terminate and such Bank
shall, by telephonic notice confirmed in writing to Borrower
(with a copy to Depositary Bank, which shall give prompt notice
thereof to each other Bank), declare that such obligation has so
terminated. If any such change shall make it unlawful for any
Bank to maintain any Eurodollar Loan or CD Loan made by it
hereunder, such Bank shall, upon the happening of such event,
notify Borrower thereof by telephone, confirmed in writing (with
a copy to Depositary Bank, which shall give prompt notice thereof
to each other Bank), stating the reasons therefor and Borrower
shall, at such time as required by law and no later than at the
end of the Interest Period of such Loan, convert such Eurodollar
Loan or CD Loan into a Prime Rate Loan by such Bank pursuant to
the provisions (other than as to prior notice, to the extent that
compliance therewith would violate applicable law) of Article V.
If prior to the Revolver Expiration Date circumstances
subsequently change so that any such Bank shall no longer be so
affected, such Bank shall reinstate its Commitment to make
Eurodollar Loans or CD Loans upon written notice to Borrower
thereof (with a copy to Depositary Bank, which shall give prompt
notice thereof to each other Bank).
SECTION 4.3. Optional Prepayment. Borrower may from
time to time, upon at least three Eurodollar Days' prior written
notice to each Bank, prepay the Loans in whole or in part,
subject to the provisions of Sections 6.1 and 6.3, without
premium or penalty other than as provided in Section 4.5;
provided however, that such optional prepayment shall, if it
occurs before the Revolver Expiration Date, not reduce the Credit
and any partial prepayment shall be in an aggregate principal
amount of at least $5,000,000 and an integral multiple of
$1,000,000.
SECTION 4.4. Interest on Principal Prepaid. Any
prepayment of principal of the Loans shall include accrued
interest to the date of prepayment on the principal amount being
prepaid. Upon any conversion of a Fixed Rate Loan pursuant to
Section 4.2, 5.6 or 5.7, Borrower shall on the date of such
conversion pay accrued interest on such Fixed Rate Loan to such
date. Payments of interest on account of a conversion pursuant
to Section 4.2, 5.6 or 5.7 shall be made directly to each Bank so
affected.
SECTION 4.5. Prepayment Compensation. If (i) any
optional or mandatory payment or prepayment of a Eurodollar Loan
or CD Loan (including, without limitation, on account of a
reduction or termination of the Credit) or any conversion of a
Eurodollar Loan or CD Loan pursuant to Article V or Section 4.2
is made on a day which is not the originally scheduled last day
(designated in Borrower's notice pursuant to Section 1.2 or 5.4)
of an Interest Period of such Loan, or (ii) the Borrower fails to
borrow, continue, or convert another Loan into, a Eurodollar Loan
or CD Loan on the date for such borrowing, continuation, or
conversion specified in the Borrower's notice pursuant to Section
1.2 or 5.4, Borrower shall pay directly to the Bank having made
such Loan or which would have made such Loan such amount or
amounts as will fully compensate such Bank for any net losses and
expenses incurred by it (or any branch or affiliate thereof) in
connection with its repayment or reinvestment in respect of
funds borrowed by it or deposited with it for the purpose of
making or maintaining such Loan, it being understood that the
amount of any such loss shall be determined with reference only
to reduced earnings derived by such Bank on, and shall not
include any loss of, any principal amount of such funds as the
result of such Bank's reinvestment thereof. Any such payment by
Borrower to any Bank shall be payable on demand made by such Bank
(accompanied by a calculation in reasonable detail of such
payment which, in the absence of demonstrable error, shall be
conclusive and binding as to the amount
thereof).
ARTICLE V
SPECIAL PROVISIONS WITH RESPECT TO
CONTINUATION OF FIXED RATE LOANS AND
CONVERSION OF LOANS BETWEEN
EURODOLLARS AND DOMESTIC DOLLARS
SECTION 5.1. Continuation of Eurodollar Loans.
Borrower may elect to continue a group of Eurodollar Loans from
any Eurodollar Period into a subsequent Eurodollar Period,
provided that such continuation shall take place on the last day
of the prior Eurodollar Period (herein, in such case, called a
"Continuation Date"). Such election shall be subject to the
notice requirements of Section 5.4. If no such election is made
in compliance with the requirements hereof and Borrower does not
pay in full the outstanding principal amount of any Eurodollar
Loan on the last day of the Eurodollar Period thereof, such
Eurodollar Loan shall automatically, without any notice from or
to Borrower, be converted into a Prime Rate Loan in accordance
with the other provisions of this Article V (other than as to
prior notice) at the end of such Eurodollar Period.
SECTION 5.1.1. Continuation of CD Loans. Borrower may
elect to continue a group of CD Loans from any CD Interest Period
into a subsequent CD Interest Period, provided that such
continuation shall take place on the last day of the prior CD
Interest Period (herein, in such case, called a "Continuation
Date"). Such election shall be subject to the notice
requirements of Section 5.4. If no such election is made in
compliance with the requirements hereof and Borrower does not pay
in full the outstanding principal amount of any CD Loan on the
last day of the CD Interest Period thereof, such CD Loan shall
automatically, without any notice from or to Borrower, be
converted into a Prime Rate Loan in accordance with the other
provisions of this Article V (other than as to prior notice) at
the end of such CD Interest Period.
SECTION 5.2. Conversion. Borrower may elect (i) on
any Eurodollar Day to convert any outstanding Domestic Loans into
Eurodollar Loans or any outstanding Eurodollar Loans into
Domestic Loans and (ii) on any Business Day to convert any
outstanding CD Loans into Prime Rate Loans or any outstanding
Prime Rate Loans into CD Loans (herein, in such case, called a
"Conversion Date"), it being understood that any such conversion
of a Eurodollar Loan or CD Loan into another type of Loan on a
day other than the last day of the Eurodollar Period or CD
Interest Period, as the case may be, of such Loan shall be
subject to the applicable provisions of Section 4.5. Such
election shall be subject to the notice requirements of Section
5.4.
SECTION 5.3. Restrictions on Borrower's Continuation
and Conversion Rights. Notwithstanding any other provisions of
this Article V, Banks shall not be obligated to effect (i) any
continuation or conversion under this Article V, so long as any
Event of Default or Credit Suspension Event has occurred and
remains continuing or (ii) any continuation of any type of Loan
outstanding or any conversion of any outstanding type of Loan
into another type of Loan so long as any of the circumstances
described in Sections 4.2, 5.5, 5.6 and 5.7 affecting such
continuation or conversion have occurred and remain continuing.
SECTION 5.4. Notice of Continuations and Conversions.
Except as otherwise provided in this Agreement, Borrower shall,
at least three Eurodollar Days prior to any Continuation Date or
Conversion Date involving a Eurodollar Loan, or at least two
Business Days prior to any Continuation Date involving a CD Loan
or conversion of a CD Loan into a Prime Rate Loan or Prime Rate
Loan into a CD Loan, give notice to Depositary Bank (which shall
give prompt notice thereof to each other Bank) of such proposed
continuation or conversion, and in the case of any Eurodollar
Loans or CD Loans to be continued or to be made by conversion on
such date, as the case may be, the duration of the subsequent
Eurodollar Period or CD Interest Period thereof.
SECTION 5.5. Interest Rate Unascertainable. In the
event that, prior to any Borrowing Date of any group of
Eurodollar Loans or CD Loans, Banks having, in the aggregate, a
Percentage of 66 2/3% or more shall have determined (which
determination shall be conclusive and binding on all parties
hereto) that (i) with respect to Eurodollar Loans and CD Loans,
the circumstances described in the third sentence of Section
3.1.4 have occurred, or that, (ii) by reason of other
circumstances affecting the London interbank eurodollar market or
certificate of deposit market, adequate and reasonable means do
not exist for ascertaining the Eurodollar Interest Rate or CD
Rate applicable to such group of Eurodollar Loans or CD Loans,
(a) such Banks shall give notice of such determination promptly
(and in any event within three Eurodollar Days after making such
determination with respect to Eurodollar Loans and within two
Business Days after making such determination with respect to CD
Loans) to the other parties hereto and, (b) with respect to any
new Eurodollar Loans or CD Loans, as the case may be, Borrower's
request for Eurodollar Loans or CD Loans, as the case may be,
shall be deemed a request for Prime Rate Loans and (c) with
respect to outstanding Eurodollar Loans or CD Loans, as the case
may be, to be continued on such Borrowing Date, such Loans shall
be converted into Prime Rate Loans in accordance with the
provisions of this Article V on such Borrowing Date,
notwithstanding any failure of Borrower to comply with the notice
provisions of Section 1.2 or 5.4, as the case may be.
SECTION 5.6. Bank Unable to Make Eurodollar Loan. In
the event that, prior to any Borrowing Date of any Eurodollar
Loan as Borrower shall request in its relevant notice of
borrowing pursuant to Section 1.2 or 5.4, any Bank requested to
make or continue such Eurodollar Loan shall (i) have determined
(which determination if made in good faith shall be conclusive
and binding on all parties hereto) that Dollar deposits in the
relevant amount and for the relevant Eurodollar Period for such
Eurodollar Loan are not available to such Bank in the London
interbank eurodollar market by reason of law or otherwise, or
(ii) learn of any change in (including the introduction of any
new) applicable laws or regulations, or in the interpretation
thereof by any governmental or other regulatory authority charged
with the administration thereof, which shall make it unlawful for
such Bank to make or continue such Eurodollar Loan for the
proposed duration thereof, such Bank shall promptly give notice
of such determination to Borrower (with a copy to Depositary
Bank, which shall give prompt notice thereof to each other Bank)
and (a) with respect to any new Eurodollar Loan, Borrower's
request for such Loan shall be deemed a request for a Prime Rate
Loan, and (b) with respect to any outstanding Eurodollar Loan to
be continued on such Borrowing Date, such Loan shall be converted
into a Prime Rate Loan in accordance with the provisions of this
Article V on such Borrowing Date, notwithstanding any failure of
Borrower to comply with the notice provisions of Section 1.2 or
5.4, as the case may be.
SECTION 5.7. Conversions Affecting Some Banks. Within
ten days of notification by any Bank that any of the
circumstances described in Section 3.1.5 or 3.1.7 shall have
occurred and remain continuing with respect to any outstanding
Eurodollar Loan or CD Loan made by such Bank, Borrower may elect
to convert such Eurodollar Loan or CD Loan to a Prime Rate Loan.
Borrower shall, at least three Eurodollar Days prior to the
proposed Conversion Date in respect of such Eurodollar Loan or
two Business Days prior to the proposed Conversion Date in
respect of such CD Loan, give notice of such conversion to
Depositary Bank (which shall give prompt notice to each other
Bank). The exemption from the ratability provisions of Section
1.1.3 shall apply to all Banks or Loans affected by conversions
made pursuant to this Section or Section 4.2 or 5.6 and so long
as any of the circumstances which permitted or required such
conversion shall remain continuing. Any Bank so affected shall
use all commercially reasonable efforts to cease being so
affected, it being understood that such obligation shall in no
way reduce the rights of Banks hereunder nor require any Bank to
take any action which would have a material adverse effect on
such Bank, to make any Eurodollar Loan at any office located in
the United States or to fund any Eurodollar Loan in domestic
Dollars.
ARTICLE VI
MAKING AND PRORATION OF PAYMENTS; OFFSET
SECTION 6.1. Making of Payments. All payments made by
Borrower hereunder shall be in immediately available funds and,
except for payments pursuant to Sections 1.3(b), 3.1.5, 3.1.7 and
4.5 and as otherwise indicated in Sections 3.2 and 4.4, shall be
made to Depositary Bank at its address set forth below its
signature hereto not later than 12:30 p.m., New York City time,
on the date due; funds received after that hour shall be deemed
to have been received by Depositary Bank on the next Eurodollar
Day or Business Day, as the case may be. Depositary Bank shall
remit in immediately available funds to each Bank or other holder
its share of all such payments received by Depositary Bank for
the account of such Bank or holder, as determined pursuant to
Section 6.3, promptly (and, in the event of any payment received
prior to 12:30 p.m., New York City time, on any Business Day, on
such Business Day).
SECTION 6.2. Payment on Revolver Expiration Date. Any
Borrower may effect payment of all or part of the Revolving
Loans, together with accrued interest thereon, on the Revolver
Expiration Date by directing Depositary Bank, in Borrower's
notice of its proposed borrowing of the Term Loans pursuant to
Section 1.2, to apply the proceeds of the Term Loans to the
extent necessary to the concurrent payment of principal of and
interest on the Revolving Loans; provided, that the aggregate
principal amount of the Term Loan shall not exceed the amount of
the Credit.
SECTION 6.3. Allocation of Payments. All payments of
principal of the Revolving Notes and Term Notes by Borrower shall
be for the account of the holders of the Revolving Notes and Term
Notes pro rata according to the respective unpaid principal
amounts of the Revolving Notes and Term Notes held by them, and
shall be applied by each such holder (except as Borrower may, in
a manner not inconsistent with other terms and provisions hereof,
otherwise elect in a notice, furnished on or prior to the date of
such payment, to Depositary Bank, which shall give prompt notice
thereof to each other Bank) first to its then outstanding
Domestic Loans other than Loans made by conversions pursuant to
Section 4.2, 5.6 or 5.7 (herein called an "Equivalent Domestic
Loan"), second to any then outstanding Equivalent Domestic Loans,
and finally to its then outstanding Eurodollar Loans. (For
purposes of this Section, any Equivalent Domestic Loan shall be
deemed an ordinary Domestic Loan to the extent that the
Eurodollar Loan from which such Equivalent Domestic Loan was
converted would otherwise have been converted to any ordinary
Domestic Loan.)
All payments of interest on Domestic Loans hereunder, except
Equivalent Domestic Loans made by an affected Bank pursuant to
Section 4.2, 5.6 or 5.7, shall be for the account of the holders
of the Revolving Notes and Term Notes pro rata according to the
respective unpaid principal amounts of Domestic Loans evidenced
by the Revolving Notes and Term Notes held by them; all payments
of interest on Equivalent Domestic Loans made by an affected Bank
pursuant to Section 4.2, 5.6 or 5.7, shall be for the account of
the holders of the Revolving Notes and Term Notes pro rata
according to the respective unpaid principal amounts of
Equivalent Domestic Loans evidenced by the Revolving Notes and
Term Notes held by them; and all payments of interest on
Eurodollar Loans hereunder, except those pursuant to Section 4.4
on account of a conversion pursuant to Section 4.2, 5.6 or 5.7,
shall be for the account of the holders of the Revolving Notes
and Term Notes pro rata according to the respective unpaid
principal amounts of Eurodollar Loans evidenced by the Revolving
Notes and Term Notes held by them.
All payments of facility fees shall be for the account of all
Banks pro rata according to the daily average amount of each
Bank's Commitment, provided that any reduction of facility fees
in respect of Equivalent Domestic Loans that are Prime Rate Loans
shall be borne pro rata by each affected Bank under Section 4.2,
5.5, 5.6 or 5.7.
Notwithstanding any other provision of this Section 6.3
payments of principal, interest, facility fees and other
obligations hereunder to any Bank upon termination of its
Commitment pursuant to Section 1.1 or pursuant to Section 3.1.7
shall be solely for the account of such Bank.
SECTION 6.4. Proration of Other Recoveries. If any
Bank or other holder of a Revolving Note or Term Note shall
obtain any payment or other recovery (whether voluntary,
involuntary, by application of offset or otherwise), other than
a prepayment compensation pursuant to Section 4.5, on account of
principal of or interest on any Revolving Note or Term Note, or
facility fees, in excess of its pro rata share, as determined
pursuant to Section 6.3, of payments and other recoveries
obtained by all Banks or other holders on account of principal of
and interest on Revolving Notes or Term Notes then held by them,
or facility fees, such Bank or other holder shall purchase from
the other Banks or holders such participation in the Revolving
Notes or Term Notes held by them, or shall make such other
payments, as shall be necessary to cause such purchasing Bank or
other holder to share the excess payment or other recovery
ratably with each of them; provided, however, that if all or any
portion of the excess payment or other recovery is thereafter
recovered from such purchasing holder, the purchase shall be
rescinded and the purchase price restored to the extent of such
recovery, but without interest.
SECTION 6.5. Offset. In addition to and not in
limitation of all rights of offset that any Bank or other holder
of a Note may have under applicable law, each Bank or other
holder of a Note shall, upon the occurrence of any Event of
Default described in Section 10.1.3 or any Credit Suspension
Event which would constitute such an Event of Default described
in Section 10.1.3, have the right, subject to Section 6.4, to
appropriate and apply to the payment of such Note any and all
balances, credits, deposits, accounts or moneys of Borrower then
or thereafter with such Bank or other holder. If, in the
aggregate, the recovery by the Banks by offset, under applicable
law, or otherwise shall exceed the obligations of Borrower under
the Notes and hereunder, any Bank receiving such an excess agrees
to promptly restore the same to Borrower.
ARTICLE VII
WARRANTIES
To induce Banks to grant the Credit and to make Loans
hereunder, the Company warrants to Banks that:
SECTION 7.1. Organization, etc. The Company is a
corporation duly existing and in good standing under the laws of
the State of New York; and each Significant Subsidiary is a
corporation duly existing and in good standing under the laws of
the jurisdiction of its respective incorporation.
SECTION 7.2. Authorization; No Conflict. The
execution and delivery of this Agreement, the borrowings
hereunder, the execution and delivery of the Notes, and the
performance by the Company of its obligations under this
Agreement and the Notes, are within the Company's corporate
powers, have been duly authorized by all necessary corporate
action, have received all necessary governmental approval (if any
shall be required), and do not and will not violate, contravene
or conflict in any material respect with any provision of law or
of the charter or by-laws of the Company or of any judgment or
any material agreement or indenture binding upon or applicable to
the Company the contravention of or conflict with which would
materially adversely effect the consolidated financial condition
or continued operations of the Company and its Subsidiaries as a
whole or materially impair the ability of the Company to perform
any of its obligations hereunder.
SECTION 7.3. Validity and Binding Nature. This
Agreement is, and the Notes when duly executed and delivered will
be, legal, valid and binding obligations of the Company
enforceable against it in accordance with their respective terms,
subject only to bankruptcy, insolvency, reorganization,
moratorium or similar laws affecting the enforceability of rights
of creditors generally.
SECTION 7.4. Financial Statements. The Company's
audited consolidated financial statements as at December 31, 1992
and unaudited consolidated financial statements as at
September 30, 1993, copies of which have been furnished to each
Bank, have been prepared in conformity with GAAP applied on a
basis consistent with that of the preceding fiscal year or
nine-month period, as the case may be, and fairly present the
financial condition of the Company and its Consolidated
Subsidiaries as at such date and the results of their operations
for the period covered by such statements subject, in the case of
any unaudited interim financial statements, to changes resulting
from normal year-end adjustments.
SECTION 7.5. Litigation. No litigation or arbitration
proceedings are pending or, to the knowledge of the Company,
threatened against the Company or any Significant Subsidiary as
to which there is a reasonable likelihood of an adverse
determination and which would reasonably be expected to have a
material adverse effect on the consolidated financial condition
or continued operations of the Company and its Subsidiaries as a
whole or materially impair the ability of the Company to perform
any of its obligations hereunder.
SECTION 7.6. Liens. None of the assets of the Company
is subject to any mortgage, pledge, title retention lien, or
other lien, encumbrance or security interest which is not
permitted by Section 8.6.
SECTION 7.7. ERISA. Neither the Company nor any
Significant Subsidiary has incurred any liability to the Pension
Benefit Guaranty Corporation in connection with any employee
benefit plan which could reasonably be expected to materially
adversely affect the consolidated financial condition or
continued operations of the Company and its Subsidiaries as a
whole or materially impair the ability of the Company to perform
any of its obligations hereunder.
SECTION 7.8. Investment Company Act. The Company is
not an "investment company," or a company "controlled" by or
"controlling" an "investment company," within the meaning of the
Investment Company Act of 1940, as amended.
SECTION 7.9. Public Utility Holding Company Act.
Neither the Company nor any of its Subsidiaries is a "holding
company," or a "subsidiary company" of a "holding company," or an
"affiliate" of a "holding company" or of a "subsidiary company"
of a "holding company," within the meaning of the Public Utility
Holding Company Act of 1935, as amended.
SECTION 7.10. Regulations G, U, and X. The Company
will not use the proceeds of the Loans in violation of
Regulations G, U, and X of the Board of Governors of the Federal
Reserve System.
ARTICLE VIII
COVENANTS
Until the expiration or termination of the Credit and
thereafter until all Liabilities are paid in full, the Company
agrees that, unless at any time Banks having, in the aggregate,
a Percentage of 66 2/3% or more shall otherwise expressly consent
in writing, it will:
SECTION 8.1. Reports, Certificates and Other
Information. Furnish to each Bank:
SECTION 8.1.1. Audit Report. Within 120 days after
each fiscal year of the Company, a copy of an annual audit report
of the Company and its Subsidiaries prepared on a consolidated
basis and in conformity with GAAP, duly certified by, and
containing an opinion of, Ernst & Young or other independent
certified public accountants of recognized national standing
selected by the Company, which opinion shall be unqualified
(excepting any qualification relating to any change in the
application of GAAP concurred in by such accountants). The
requirements of this Section (other than the requirement that any
opinion shall be unqualified as aforesaid) shall be satisfied by
the Company's furnishing each Bank with a copy of its annual
report on Form 10-K filed with the Securities and Exchange
Commission in accordance with the instructions therefor.
SECTION 8.1.2. Interim Reports. Within 60 days after
each quarter (except the last quarter) of each fiscal year of the
Company, a copy of an unaudited financial statement of the
Company and its Subsidiaries prepared on a consolidated basis and
in conformity with GAAP applied on a basis consistent with the
most recent audit report referred to in Section 8.1.1, signed by
a proper accounting officer of the Company and consisting of at
least a balance sheet as at the close of such quarter, a
statement of earnings for such quarter and for the period from
the beginning of such fiscal year to the close of such quarter
and a statement of cash flows for the period from the beginning
of such fiscal year to the close of such quarter. The
requirements of this Section shall be satisfied by the Company's
furnishing each Bank with a copy of its quarterly report on Form
10-Q filed with the Securities and Exchange Commission in
accordance with the instructions therefor.
SECTION 8.1.3. Certificates. Contemporaneously with
the furnishing of a copy of each annual audit report and of each
quarterly statement provided for in Section 8.1.1 or 8.1.2, a
certificate dated the date of such annual report or such
quarterly statement and signed by the Chairman of the Board, any
Senior Vice President, the chief financial officer or the
Treasurer of the Company, to the effect that no Event of Default
or Credit Suspension Event has occurred and is continuing, or, if
there is any such event, describing it and the steps, if any,
being taken to cure it.
SECTION 8.1.4. Reports to SEC and to Shareholders.
Copies of each report on Form 10-K, 10-Q or 8-K (excluding
exhibits thereto) made by any Borrower with the Securities and
Exchange Commission, and of each annual report, quarterly report,
special report or proxy statement from the Company to its
shareholders generally, promptly after the filing or making
thereof.
SECTION 8.1.5. Notice of Default or Litigation.
Forthwith upon learning of the occurrence of an Event of Default,
or a Credit Suspension Event, or of the institution of, or any
adverse determination in, any litigation or arbitration
proceeding as to which there is a reasonable likelihood of an
adverse determination and which would reasonably be expected to
have a material adverse effect on the consolidated financial
condition or continued operations of the Company and its
Subsidiaries as a whole or materially impair the ability of the
Company to perform any of its obligations hereunder, written
notice thereof describing the same and the steps being taken by
the Company or the Subsidiary affected with respect thereto.
SECTION 8.1.6. ERISA. As soon as practicable after
the occurrence of any Reportable Event (as defined in the
Employee Retirement Income Security Act of 1974) which is
material to the Company and its Significant Subsidiaries taken as
a whole, in connection with any employee pension benefit plan
maintained by the Company or any Significant Subsidiary, written
notice thereof describing the same.
SECTION 8.1.7. Other Information. From time to time
such other information concerning the Company and its
Subsidiaries as any Bank may reasonably request.
SECTION 8.2. Books, Records and Inspections.
Maintain, and cause each Subsidiary to maintain, proper books and
records in the form customarily employed by them; permit, and
cause each Subsidiary to permit, upon reasonable notice and
during normal business hours, access by any Bank to the books and
records of the Company and of any Subsidiary; and permit, and
cause each Subsidiary to permit, any Bank to inspect upon
reasonable notice and during normal business hours the properties
and operations of the Company and of any Subsidiary.
SECTION 8.3. Insurance. Maintain, and cause each
Significant Subsidiary to maintain, such insurance as may be
required by law and such other insurance to such extent and
against such hazards and liabilities, as is customarily
maintained by companies similarly situated.
SECTION 8.4. Taxes and Liabilities. Pay, and cause
each Significant Subsidiary to pay, when due all taxes,
assessments and other liabilities except as contested in good
faith and by appropriate proceedings.
SECTION 8.5. Purchase or Redemption of the Company's
Securities; Dividend Restrictions. Not purchase, prepay or
redeem, or permit any Subsidiary to purchase, any shares of the
capital stock of the Company, not declare or pay any dividends
thereon (other than stock dividends), not make any distribution
to shareholders or set aside any funds for any such purpose, not
prepay, and not permit any Subsidiary to purchase or prepay, any
subordinated indebtedness for borrowed money of the Company if,
after giving effect thereto, any Event of Default or Credit
Suspension Event shall have occurred and be continuing; provided
that the foregoing shall not prevent the payment of any dividend
or distribution within 60 days of the declaration thereof if, on
the date of such declaration, such dividend or distribution would
have complied with this Section 8.5.
SECTION 8.6. Liens. If the ratio of Consolidated Debt
to Consolidated Capitalization of the Company is more than
0.35:1, not create, incur, assume or suffer to exist any
mortgage, pledge, lien or other encumbrance of any kind
(including the charge upon property purchased under conditional
sales or other title retention agreements) upon, or any security
interest in, any of its property or assets, whether now owned or
hereafter acquired, except (i) liens for taxes, assessments and
governmental charges not delinquent or being contested in good
faith or by appropriate proceedings and for which adequate
reserves have been established in accordance with GAAP,
(ii) existing liens securing indebtedness, including mortgage
debt, as reflected in the Company's consolidated balance sheet as
of September 30, 1993, (iii) liens arising in favor of the United
States Government, any state or local government or any
subdivision or agency thereof in the ordinary course of the
Company's business with any of the foregoing for advances,
progress payments or partial prepayments, (iv) liens in
connection with workers' compensation, unemployment insurance or
social security obligations, (v) liens or deposits or pledges to
secure bids, tenders, contracts (other than contracts for
repayment of borrowed money), leases, statutory obligations,
surety and appeal bonds, indemnity, performance and similar bonds
and other obligations of like nature arising in the ordinary
course of business, (vi) mechanics', workmen's, materialmen's,
carriers', warehousemen's or other like liens arising in the
ordinary course of business with respect to obligations which are
not due or which are being contested in good faith or by
appropriate proceedings and for which adequate reserves have been
established in accordance with GAAP, (vii) liens arising out of
judgments or awards with respect to which appeals are being
prosecuted, levy of execution pending such appeal having been
stayed, (viii) rights-of-way, easements, water rights, sewage and
drainage rights, zoning or use regulations or similar defects in
title which do not materially impair the use of any property for
the purposes for which held, (ix) the lien or any right or
privilege reserved in leases for rent to secure compliance with
the terms of any lease, but not including any lien arising from
a violation of any lease provision other than one relating to
conditional assignment of rents, (x) liens of attachment not
exceeding in the aggregate $15,000,000 outstanding at any one
time, (xi) liens of attachment exceeding in the aggregate
$15,000,000 (but not exceeding in the aggregate $150,000,000)
outstanding at any one time, provided, however, that any such
liens shall be released, discharged or vacated by bonding or
otherwise within 30 days, (xii) deposits to obtain releases of
liens imposed by law and permitted hereunder, (xiii) any
mortgage, encumbrance or other lien upon, or security interest
in, any property or asset (whether real, personal or mixed)
hereafter acquired created contemporaneously with or within 365
days after such acquisition to secure or provide for the payment
or financing of any part of the purchase price thereof, or the
assumption of any mortgage, encumbrance or lien upon, or security
interest in, any such property or asset hereafter acquired
existing at the time of such acquisition, or the acquisition of
any such property or asset subject to any mortgage, encumbrance
or other lien or security interest without the assumption thereof
(provided, at any one time that each such mortgage, encumbrance,
lien or security interest shall attach only to the property or
asset so acquired and improvements thereon), (xiv) other liens
which do not, in the aggregate, relate to or secure obligations
exceeding 5% of Consolidated Capitalization, (xv) any encumbrance
or lien upon margin stock and (xvi) any renewal, modification,
extension, refinancing or replacement of any mortgage,
encumbrance, lien or security interest permitted under clause
(ii), (xiii) or (xiv), provided that the amount of indebtedness
secured thereby is not increased and that any such mortgage,
encumbrance, lien, or security interest is limited to all or part
of the same property and any fixed improvement thereon; provided,
that nothing in this Section 8.6 shall be construed as
prohibiting (x) conveyances of property to a political
subdivision pursuant to an industrial revenue or pollution
control bond financing whereby equitable title to such property
remains in the Company (provided, however, any mortgage, deed of
trust or other security interest in the facility in connection
therewith shall not be so excluded), or (y) the deposit of
property or money with a trustee or other entity, or the
establishment of an escrow, trust or similar account, for the
purpose of defeasing indebtedness of the Company.
SECTION 8.7. Mergers and Consolidations. Not be a
party to any merger or consolidation unless (i) after giving
effect to such merger or consolidation, no Event of Default and
no Credit Suspension Event shall have occurred and be continuing,
(ii) the corporation resulting from or surviving such merger or
consolidation (if other than the Company) shall expressly assume
in writing (in a form reasonably acceptable to Banks having, in
the aggregate, a Percentage of 66 2/3% or more) and agree to
perform all the Company's obligations under this Agreement and
(iii) immediately after giving effect to such merger or
consolidation the surviving corporation shall have a Consolidated
Net Worth at least equal to the Consolidated Net Worth of the
Company immediately preceding such merger or consolidation;
provided, that nothing in this Agreement shall prevent the merger
of any Subsidiary with and into the Company or into another
Subsidiary or the liquidation of any Subsidiary.
SECTION 8.8. Sale or Other Disposition of Assets.
Not, and not permit any Subsidiary to, sell or otherwise dispose
of, whether by merger or otherwise, all or any substantial
portion of its assets, except (i) to or with any other Subsidiary
or the Company, (ii) in the ordinary course of business,
(iii) all of the assets of, or the ownership interest in, any
Subsidiary which is not a Significant Subsidiary or (iv) on such
other terms and conditions as shall have been approved by the
Company's Board of Directors but, in the case of any transfer
made pursuant to clause (iii) or (iv), only if, after giving
effect thereto, no Event of Default or Credit Suspension Event
shall have occurred and be continuing.
SECTION 8.9. Interest Coverage and Consolidated Debt
to Consolidated Capitalization Ratio. Not permit, as of the end
of any fiscal quarter, both (A) the ratio of Consolidated EBDIT
to Consolidated Cash Interest Expense for the twelve month period
including such fiscal quarter and the three immediately preceding
fiscal quarters to be less than 2.50 to 1.0 and (B) the ratio of
Consolidated Debt to Consolidated Capitalization at the end of
such fiscal quarter to be more than .60 to 1.0.
ARTICLE IX
CONDITIONS OF LENDING
SECTION 9.1. Initial Revolving Loans. The obligation
of each Bank to make its initial Revolving Loan hereunder is
subject to the receipt by such Bank of all of the following, each
duly executed:
SECTION 9.1.1. Revolving Note. The Revolving Note of
the Company payable to the order of such Bank.
SECTION 9.1.2. Resolutions. Copies of resolutions of
the Board of Directors of the Company authorizing or ratifying
the execution, delivery and performance, respectively, of this
Agreement, the Notes, and other documents provided for in this
Agreement, certified by the Secretary or an Assistant Secretary
of the Company.
SECTION 9.1.3. Consents, etc. Copies of all documents
evidencing any necessary corporate action, consents and
governmental approvals (if any) with respect to this Agreement
and the Notes, certified by the Secretary or an Assistant
Secretary of the Company.
SECTION 9.1.4. Incumbency and Signatures. A
Certificate of the Secretary or an Assistant Secretary of the
Company certifying the names of the officer or officers of the
Company authorized to sign this Agreement and the Notes and other
documents provided for in this Agreement, together with a sample
of the true signature of each such officer.
SECTION 9.1.5. Opinion of Counsel to Borrower. The
opinion of Messrs. Cahill Gordon & Reindel, counsel for the
Company, addressed to Banks, substantially in the form of
Exhibit D.
SECTION 9.1.6. Other. Such other documents as any
Bank may reasonably request.
SECTION 9.2. All Revolving Loans. The obligation of
each Bank to make each Revolving Loan (including, without
limitation, its initial Revolving Loan but excluding, however,
any Loan made by a continuation or conversion pursuant to Article
V and any repayment and reborrowing deemed to have been made
pursuant to Section 1.1.8) is subject to the following further
conditions precedent that:
SECTION 9.2.1. No Default. After giving effect to all
Loans then being made (a) no Event of Default, or Credit
Suspension Event, shall have occurred and be continuing, (b) the
warranties of the Company contained in Sections 7.1, 7.2, 7.3,
7.6, 7.7, 7.8, 7.9 and 7.10 shall be true and correct in all
material respects with the same effect as though made on such
date and (c) if the Borrower of such Loan is a Designated
Subsidiary, the warranties of such Borrower in its Designation
Letter shall be true and correct in all material respects with
the same effect as though made on such date.
SECTION 9.2.2. Confirmatory Certificate. Depositary
Bank shall have received (in sufficient number of signed
counterparts to provide, and Depositary Bank shall provide, one
to each Bank) a certificate dated the date of such requested Loan
and signed by the Chairman of the Board, any Senior Vice
President, the Chief Financial Officer or the Treasurer of the
Company as to the matters set out in Sections 9.2.1 and 9.2.3.
SECTION 9.2.3. Litigation. No litigation, arbitration
proceedings or governmental investigation or proceedings not
disclosed in writing by the Company to Banks prior to the date of
the immediately preceding Revolving Loan hereunder (or in the
case of the initial Revolving Loan, prior to the date of
execution and delivery of this Agreement) is pending or known to
be threatened against the Company or any Subsidiary and no
material development not so disclosed has occurred in any
litigation, arbitration proceeding or governmental proceeding so
disclosed, which in the opinion of Banks having, in the
aggregate, a Percentage of 66 2/3% or more, is likely to
materially adversely affect the consolidated financial condition
or continued operations of the Company and its Subsidiaries as a
whole or materially impair the ability of the Company to perform
its obligations hereunder.
SECTION 9.3. Initial Loan to Any Designated
Subsidiary. The obligation of each Bank to make the initial Loan
to each Designated Subsidiary hereunder is subject to the further
conditions precedent that such Bank shall have received:
SECTION 9.3.1. Basic Documents. The Revolving Note of
such Designated Subsidiary payable to the order of the Bank and,
with respect to such Designated Subsidiary the documents
contemplated by Sections 9.1.2, 9.1.3 and 9.1.4.
SECTION 9.3.2. Designation. The Designation Letter of
such Designated Subsidiary, substantially in the form of
Exhibit E.
SECTION 9.3.3. Opinion of Counsel. A signed copy of
an opinion of counsel to such Designated Subsidiary,
substantially in the form of Exhibit F.
SECTION 9.4. Term Loans. The obligation of each Bank
to make Term Loans is subject to the conditions precedent
(i) that such Bank shall have received the Term Note of Borrower
payable to the order of such Bank, duly executed and dated the
date of such Term Loan, and that the principal of and accrued
interest on all Revolving Notes shall have been or be paid in
full prior to or concurrently with the making of such Term Loan
and (ii) that, if the original principal amount of such Bank's
Term Notes exceeds the principal amount of its Revolving Notes
outstanding immediately prior thereto, each of the conditions
precedent set forth in Sections 9.2.1 through 9.2.3 shall have
been satisfied as if such Term Loan were a Revolving Loan.
ARTICLE X
GUARANTEE
SECTION 10.1. Unconditional Guarantee. For valuable
consideration, receipt whereof is hereby acknowledged, and to
induce each Bank to make Loans to the Designated Subsidiaries,
the Company, as principal and not merely as surety, hereby
unconditionally and irrevocably guarantees to each Bank that:
(i) the principal of and interest on each Loan to each Designated
Subsidiary shall be promptly paid in full when due (whether at
stated maturity, by acceleration or otherwise) in accordance with
the terms hereof, and, in case of any extension of time of
payment, in whole or in part, of such Loan, that all such sums
shall be promptly paid when due (whether at stated maturity, by
acceleration or otherwise) in accordance with the terms of such
extension; and (ii) all other amounts payable hereunder by any
Designated Subsidiary to any Bank shall be promptly paid in full
when due in accordance with the terms hereof (the obligations of
the Designated Subsidiaries under these subsections (i) and (ii)
of this Section 10.1 being the "Obligations").
In addition, the Company hereby unconditionally and irrevocably
agrees that upon default in the payment when due (whether at
stated maturity, by acceleration or otherwise) of any principal
of, or interest on, any Loan to any Designated Subsidiary or such
other amounts payable by any Designated Subsidiary to any Bank,
the Company will forthwith pay the same, without further notice
or demand.
SECTION 10.2. Guarantee Absolute. The Company
guarantees that the Obligations will be paid strictly in
accordance with the terms of this Agreement, regardless of any
law, regulation or order now or hereafter in effect in any
jurisdiction affecting any of such terms or the rights of any
Bank with respect thereto. The liability of the Company under
this guarantee shall be absolute and unconditional irrespective
of: (i) any lack of validity or enforceability of this Agreement
or any other agreement or instrument relating thereto; (ii) any
change in the time, manner or place of payment of, or in any
other term of, all or any of the Obligations,or any other
amendment or waiver of or any consent to departure from this
Agreement (including, without limitation, any extension of the
Revolver Expiration Date or any Commitment Increase); (iii) any
release or amendment or waiver of or consent to departure from
any other guaranty, for all or any of the Obligations; or (iv)
any other circumstance which might otherwise constitute a defense
available to, or a discharge of, the Company, any Borrower or a
guarantor.
The guarantee shall continue to be effective or be reinstated, as
the case may be, if at any time any payment of any of the
Obligations is rescinded or must otherwise be returned by any of
the Banks upon the insolvency, bankruptcy or reorganization of
the Company or any Borrower or otherwise, all as though such
payment had not been made.
SECTION 10.3. Waivers. The Company hereby expressly
waives diligence, notice of acceptance of this guarantee,
presentment, demand for payment, protest, any requirement that
any right or power be exhausted or any action be taken against
any Designated Subsidiary or against any other guarantor of all
or any portion of the Loans, and all other notices and demands
whatsoever.
The Company irrevocably waives any and all rights to
which it may be entitled, by operation of law or otherwise, upon
the making of any payment under the guarantee contained in this
Article X to be subrogated to the rights of the payee against any
Designated Subsidiary with respect to such payment or to
otherwise be reimbursed, indemnified or exonerated by a
Designated Subsidiary in respect thereof.
SECTION 10.4. Remedies. Each of the Banks may pursue
its respective rights and remedies under this Article X and shall
be entitled to payment hereunder notwithstanding any other
guarantee of all or any part of the Loans to the Designated
Subsidiaries, and notwithstanding any action taken by any such
Bank to enforce any of its rights or remedies under such other
guarantee, or any payment received thereunder. The Company
hereby irrevocably waives any claim or other rights that it may
now or hereafter acquire against the Designated Subsidiary that
arise from the existence, payment, performance or enforcement of
the Company's obligations under this Article X, including,
without limitation, any right of subrogation, reimbursement,
exoneration, contribution or indemnification and any right to
participate in any claim or remedy of the Banks against the
Designated Subsidiary, whether or not such claim, remedy or right
arises in equity or under contract, statute or common law,
including, without limitation, the right to take or receive from
the Designated Subsidiary, directly or indirectly, in cash or
other property or by set-off or in any other manner, payment or
security on account of such claim, remedy or right. If any
amount shall be paid to the Company in violation of the preceding
sentence at any time when all the Obligations shall not have been
paid in full, such amount shall be held in trust for the benefit
of the Banks and shall forthwith be paid to the Depositary Bank
for the accounts of the respective Banks to be credited and
applied to the Obligations, whether matured or unmatured, in
accordance with the terms of this Agreement, or to be held as
collateral for any Obligations or other amounts payable under
this Agreement thereafter arising. The Company acknowledges that
it will receive direct and indirect benefits from the financing
arrangements contemplated by this Agreement and that the waiver
set forth in this section is knowingly made in contemplation of
such benefits.
SECTION 10.5. Survival. This guaranty is a continuing
guaranty and shall (i) remain in full force and effect until
payment in full of the Obligations and all other amounts payable
under this guaranty, (ii) be binding upon the Company, its
successors and assigns, (iii) inure to the benefit of and be
enforceable by each Bank and their respective successors,
transferees and assigns and (iv) be reinstated if at any time any
payment to a Bank hereunder is required to be restored by such
Bank.
ARTICLE XI
EVENTS OF DEFAULT AND THEIR EFFECT
SECTION 11.1. Events of Default. Each of the
following shall constitute an Event of Default under this
Agreement:
SECTION 11.1.1. Non-Payment of Notes, etc. Default,
and continuance thereof for five days after the due date thereof,
in the payment when due of any interest on any Note or any
facility fee, or default in the payment when due of any principal
of any Note or other amounts payable by any Borrower hereunder
(excluding, however, to the extent disputed by Borrower in good
faith, amounts payable pursuant to Section 3.1.5, 3.1.7 or 4.5 in
an aggregate amount not exceeding $1,000,000 for all Banks).
SECTION 11.1.2. Non-Payment of Other Indebtedness.
Default in the payment when due (subject to any applicable grace
period), whether by acceleration or otherwise, of any other
indebtedness for borrowed money or other obligations evidenced by
a note, debenture, or similar instrument (including capitalized
lease obligations) in an aggregate principal amount exceeding
$50,000,000 of, or guaranteed by, the Company or any Significant
Subsidiary or default in the performance or observance of any
obligation or condition with respect to any such other
indebtedness if the effect of such default in the performance or
observance is to accelerate the maturity of any such indebtedness
or to permit the holder or holders thereof, or any trustee or
agent for such holders, to cause such indebtedness to become due
and payable prior to its expressed maturity.
SECTION 11.1.3. Bankruptcy, Insolvency, etc. (i) The
Company or any Significant Subsidiary becomes insolvent or admits
in writing its inability to pay its debts or fails to pay its
debts, generally as they become due; or the Company or any
Significant Subsidiary applies for, consents to, or acquiesces in
the appointment of, a trustee, custodian or receiver for the
Company or such Significant Subsidiary or any property thereof,
or makes a general assignment for the benefit of creditors; or,
in the absence of such application, consent or acquiescence, a
trustee, custodian or receiver is appointed for the Company or
any Significant Subsidiary or for a substantial part of the
property of any thereof and is not discharged within 60 days; or
any bankruptcy, reorganization, debt arrangement, or other
proceeding or case under any bankruptcy or insolvency law, or any
dissolution or liquidation proceeding (except the voluntary
dissolution, not under any bankruptcy or insolvency law, of a
Significant Subsidiary), is commenced in respect of the Company
or any Significant Subsidiary, and if such proceeding is not
commenced by the Company or Significant Subsidiary, it is
consented to or acquiesced in by the Company or Significant
Subsidiary or remains for 60 days undismissed; or any corporate
action is taken by the shareholder(s) or board of directors of
the Company or any Significant Subsidiary to authorize or further
any of the actions described in this Section 11.1.3.
SECTION 11.1.4. Non-Compliance with This Agreement.
Failure by the Company to comply with or to perform any provision
of this Agreement (and not constituting an Event of Default under
any of the preceding provisions of this Article XI) and
continuance of such failure for 30 days, after notice thereof to
the Company from any Bank or the holder of any Note stating that
such Bank or holder is of the opinion that such failure is
material; provided, that, any failure by the Company to comply
with any provision of this Agreement solely as a result of a
change in GAAP shall not constitute an Event of Default.
SECTION 11.1.5. Warranties. Any warranty made by the
Company herein is breached in any material respect, or any
schedule, certificate, financial statement or report furnished by
the Company to any Bank is false or misleading in any material
respect on the date as of which the facts therein set forth are
stated or certified.
SECTION 11.1.6. ERISA. The Company or any Significant
Subsidiary incurs any liability to the Pension Benefit Guaranty
Corporation or any successor thereto in excess of $50,000,000.
SECTION 11.2. Effect of Event of Default. If any
Event of Default described in Section 11.1.3 shall occur, the
Credit (if it has not theretofore terminated) shall immediately
terminate and all Notes and all other amounts payable hereunder
shall become immediately due and payable, all without presentment
or notice of any kind all of which are hereby waived; and, in the
case of any other Event of Default which shall have occurred and
remain continuing, Banks having, in the aggregate, a Percentage
of 66 2/3% or more may, by the giving of notice in writing to the
Company, declare the Credit (if it has not theretofore
terminated) to be terminated and/or all Notes and all other
amounts payable hereunder to be immediately due and payable,
whereupon the Credit shall immediately terminate and/or all Notes
and all other amounts payable hereunder shall become immediately
due and payable, all without presentment or notice of any kind
all of which are hereby waived. Notwithstanding the foregoing,
the effect as an Event of Default of any event described in
Section 11.1.1 or Section 11.1.3 may be waived by the written
concurrence of Banks having, in the aggregate, a Percentage of
100%, and the effect as an Event of Default of any other event
described in Section 11.1 may be waived by the written
concurrence of Banks having, in the aggregate, a Percentage of 66
2/3% or more.
SECTION 11.3. Defaults by Designated Subsidiaries. If
any of the following defaults with respect to any Designated
Subsidiary have occurred and are continuing then Section 11.4
shall apply:
SECTION 11.3.1. Warranties. Any warranty made by such
Designated Subsidiary herein or in the Designation Letter
pursuant to which it is designated as a Borrower hereunder is
breached in any material respect or any schedule, certificate,
financial statement or report furnished by such Designated
Subsidiary to any Bank is false or misleading in any material
respect on the date as of which the facts therein set forth are
stated or certified.
SECTION 11.3.2. Non-Payment of Other Indebtedness.
Default in the payment when due (subject to any applicable grace
period), whether by acceleration or otherwise, of any other
indebtedness for borrowed money or other obligations evidenced by
a note, debenture, or similar instrument (including capitalized
lease obligations) in a principal amount exceeding $50,000,000
of, or guaranteed by, a Designated Subsidiary or default in the
performance or observance of any obligation or condition with
respect to any such other indebtedness if the effect of such
default in the performance or observance is to accelerate the
maturity of any such indebtedness or to permit the holder or
holders thereof, or any trustee or agent for such holders, to
cause such indebtedness to become due and payable prior to its
expressed maturity.
SECTION 11.3.3. Bankruptcy, Insolvency, etc. A
Designated Subsidiary becomes insolvent or admits in writing its
inability to pay its debts or fails to pay its debts, generally
as they become due; or the Designated Subsidiary applies for,
consents to, or acquiesces in the appointment of, a trustee,
custodian or receiver for such Designated Subsidiary or any
property thereof, or makes a general assignment for the benefit
of creditors; or, in the absence of such application, consent or
acquiescence, a trustee, custodian or receiver is appointed for
any Designated Subsidiary or for a substantial part of the
property of any thereof and is not discharged within 60 days; or
any bankruptcy, reorganization, debt arrangement, or other
proceeding or case under any bankruptcy or insolvency law, or any
dissolution or liquidation proceeding is commenced in respect of
the Company or any Significant Subsidiary, and if such
proceeding is not commenced by such Designated Subsidiary, it is
consented to or acquiesced in by such Designated Subsidiary or
remains for 60 days undismissed; or any corporate action is taken
by the shareholder(s) or board of directors of any Designated
Subsidiary to authorize or further any of the actions described
in this Section 11.3.3.
SECTION 11.3.4. Non-Compliance with This Agreement.
Failure by Designated Subsidiary to comply with or to perform any
provision of this Agreement (and not constituting an Event of
Default under any of the preceding provisions of this Section
11.3) and continuance of such failure for 30 days, after notice
thereof to the Company and the Designated Subsidiary from any
Bank or the holder of any Note stating that such Bank or holder
is of the opinion that such failure is material.
SECTION 11.4. Effect of Default by Designated
Subsidiary. If any default described in Section 11.3.2 or 11.3.3
shall occur, without any action by the Bank, the Banks shall have
no obligation to make Loans to such Designated Subsidiary under
this Agreement and all Loans under this Agreement to such
Designated Subsidiary and all other amounts payable hereunder by
such Designated Subsidiary shall become immediately due and
payable, all without presentment or notice of any kind; and, in
the case of any other default described in Section 11.3 which
shall have occurred and remain continuing, Banks having, in the
aggregate, a Percentage of 66 2/3% or more may, by the giving of
notice in writing to the Company, decline to make further Loans
to such Designated Subsidiary and/or declare all Loans under this
Agreement to such Designated Subsidiary and all other amounts
payable hereunder by such Designated Subsidiary to be immediately
due and payable, without presentment or notice of any kind.
Notwithstanding the foregoing, the effect of any event described
in Section 11.3 may be waived by the written concurrence of Banks
having, in the aggregate, a Percentage of 66 2/3% or more.
ARTICLE XII
CERTAIN DEFINITIONS
When used herein, the following terms shall have the
following meanings (which shall be equally applicable to the
singular and plural forms thereof):
"Alternate Currency" means any currency other than
Dollars which is freely transferable and convertible into
Dollars.
"Alternate Currency Loan" see the definition below of
"Loan."
"Alternate Currency Payment Office" has the meaning
specified in Section 1.3(e).
"Alternate Rating Agency" shall mean (i) Fitch
Investors Service, Inc., (ii) Duff & Phelps Credit Rating Co. or
(iii) another nationally recognized rating agency selected by the
Borrower to rate its senior debt securities, which, in the case
of clause (iii), shall be approved by Banks having, in the
aggregate, a Percentage of at least 66 2/3%.
"Assuming Bank" shall mean, at any time, a Person which
proposes to become a Bank hereunder pursuant to Section 1.1.8.
"Assumption Agreement" shall mean an agreement by which
an institution agrees to become a Bank party to this Agreement
pursuant to Section 1.1.8.
"Bank" shall mean the Banks listed on the signature
pages hereof and each institution that becomes a party hereto
pursuant to Section 1.1.8 or 13.5.
"Bank Indemnitees" -- see Section 13.9.
"Borrower" shall mean the Company or any Designated
Subsidiary, as the context may require.
"Borrowing Date" shall mean, with respect to each Loan,
the date upon which a Bank makes such Loan hereunder to Borrower.
"Business Day" shall mean a day on which banks are not
authorized or required by law to close for business in New York
City.
"CD Interest Period" shall mean as to each CD Loan, the
period which shall begin on (and include) the most recent
Borrowing Date with respect to such Loan, and shall end, as
Borrower shall elect in its notice pursuant to Section 1.2 or
5.4, as the case may be, on (and include) the day 30, 60, 90 or
180 days thereafter, as selected by Borrower; provided that no CD
Interest Period commencing prior to the Revolver Expiration Date
or the final maturity, by acceleration or otherwise, of all of
the Term Loans shall end later than such Revolver Expiration Date
or date of maturity of the Term Loans, as the case may be, and
further, provided that any CD Interest Period which would
otherwise end on a day which is not a Business Day shall be
extended to the next succeeding Business Day.
"CD Loan" -- see definition below of "Loan".
"CD Margin" -- see Section 3.1.8.
"CD Rate" shall mean for each CD Interest Period a rate
per annum which is equal to the CD Margin as of the first day of
the applicable Interest Period plus the sum (rounded if necessary
to the nearest 1/20 of 1%) of (i) the rate obtained by dividing
(x) the arithmetic mean as calculated by the Depositary Bank of
the respective rates per annum (rounded if necessary to the
nearest 1/20 of 1%) of the Reference Banks, in each such case
determined by each Reference Bank to be the average of the bid
rates quoted to it at its principal office at approximately 10:00
a.m. New York City time (or as soon thereafter as practicable) on
the first day of the CD Interest Period for such Loan by New York
certificate of deposit dealers of recognized standing selected by
such Reference Bank for the purchase at face value in the
secondary certificate of deposit market of certificates of
deposit of such Reference Bank for a period, and in an amount,
comparable to such CD Interest Period and the principal amount of
the CD Loan which shall be made by such Reference Bank and
outstanding during such CD Interest Period, provided, that, if
such quotations from such dealers are not available to any
Reference Bank, such Reference Bank shall determine a reasonably
equivalent rate on the basis of another source or sources
selected by it, by (y) a percentage equal to 100% minus the
stated maximum rate of all reserve requirements as specified in
Regulation D (including, without limitation, any marginal,
emergency, supplemental, special or other reserves) applicable on
the first day of such CD Interest Period to a negotiable
certificate of deposit in excess of $100,000 with a maturity
equal to such CD Interest Period of any member bank of the
Federal Reserve System, plus (ii) the daily net annual assessment
rate as estimated by the Depositary Bank on the first day of such
CD Interest Period for determining the current annual assessment
payable by the Depositary Bank to the Federal Deposit Insurance
Corporation for insuring such certificates of deposit.
"Commitment" shall mean the amount set forth opposite
each Bank's signature hereto, as such amount may be reduced or
increased from time to time pursuant to Sections 1.1.6, 1.1.7 and
1.1.8 or Section 13.5.
"Commitment Increase" has the meaning specified in
Section 1.1.8.
"Consolidated Capitalization" shall mean the sum of
Consolidated Debt and Consolidated Net Worth.
"Consolidated Cash Interest Expense" means, with
respect to the Company for any period, total interest expense
deducted in calculating Consolidated Net Income (including that
attributable to capitalized lease liabilities of the Company and
Consolidated Subsidiaries in accordance with GAAP, but excluding
interest expense not payable in cash (including amortization of
discount)), with respect to all outstanding Consolidated Debt, as
determined on a consolidated basis for the Company and
Consolidated Subsidiaries in conformity with GAAP.
"Consolidated Debt" shall mean the sum of all
indebtedness for borrowed money of the Company and Consolidated
Subsidiaries, all indebtedness secured by assets of (and whether
or not assumed by) the Company or any Consolidated Subsidiary
(which indebtedness shall be valued at the lesser of the
outstanding principal amount thereof or the book value of such
assets), all capitalized lease liabilities of the Company and
Consolidated Subsidiaries and all outstanding obligations under
guarantees and similar undertakings with respect to any such
indebtedness or liabilities of Persons other than the Company and
Consolidated Subsidiaries which is required to be reflected on
the Company's balance sheet (excluding any notes thereto) in
accordance with GAAP; provided, that there shall be excluded from
Consolidated Debt any such indebtedness which by its terms is
presently convertible into or exchangeable for capital stock of
the Company at a price per share at least 15 percent below the
Current Market Price per share of such capital stock.
"Consolidated EBDIT" shall mean, without duplication,
with respect to the Company and Consolidated Subsidiaries for any
period, the sum of the amounts for such period of (i)
Consolidated Net Income, (ii) provision for taxes based on
income, (iii) depreciation expense, (iv) amortization expense,
(v) total interest expense deducted in calculating Consolidated
Net Income, and (vi) other non-cash items reducing Consolidated
Net Income all as determined on a consolidated basis for the
Company and Consolidated Subsidiaries in conformity with GAAP.
"Consolidated Net Income" shall mean with respect to
the Company for any period, the net income (or loss) of the
Company and Consolidated Subsidiaries on a consolidated basis for
such period taken as a single accounting period determined in
conformity with GAAP; provided that there shall be excluded (i)
the income (or loss) of any Person (other than a Subsidiary of
the Company) in which any other Person (other than the Company or
any of its Subsidiaries) has a joint interest, except to the
extent of the amount of dividends or other distributions actually
paid to the Company or any of its Subsidiaries by such Person
during such period and (ii) the income (or loss) of any Person
accrued prior to the date it becomes a Subsidiary of the Company
or is merged into or consolidated with any of the Company's
Subsidiaries or that Person's assets are acquired by the Company
or any of its Subsidiaries.
"Consolidated Net Worth" shall mean the par value (or
value stated on the books of the Company) of the capital stock of
all classes of the Company and Consolidated Subsidiaries issued
and outstanding, plus (or minus in the case of a surplus
deficit), the amount of the consolidated surplus, whether capital
or earned, of the Company and its Subsidiaries plus the principal
amount of any indebtedness of the Company and the Consolidated
Subsidiaries which by its terms is presently convertible into or
exchangeable for capital stock of the Company at a price per
share at least 15 percent below the Current Market Price per
share of such capital stock.
"Consolidated Subsidiary" shall mean any Subsidiary the
accounts of which are consolidated with those of the Company in
accordance with GAAP.
"Continuation Date" -- see Section 5.1.
"Conversion Date" -- see Section 5.2.
"Credit" shall mean the sum of (i) the aggregate unused
Commitments of all Banks hereunder to make Revolving Loans or
Term Loans plus (ii) the aggregate principal amount of Revolving
Loans or Term Loans outstanding hereunder.
"Credit Suspension Event" shall mean any event which if
it continues uncured will, with lapse of time or notice or lapse
of time and notice, constitute an Event of Default.
"Current Market Price" shall mean for any class of
capital stock of the Company the average for any 20 consecutive
Stock Trading Days ending within 30 days of the date of
determination of the average of the high and low sale prices per
share, or if no sales are reported, the average of the bid and
ask prices per share or, if more than one in either case, the
average of the average bid and average ask prices per share) for
each Stock Trading Day in such 20 consecutive Stock Trading Day
period, as reported in the composite transactions for the New
York Stock Exchange, or if such capital stock is not listed or
admitted to trading on such exchange, as reported in the
composite transactions for the principal national or regional
United States securities exchange on which such capital stock is
listed or admitted to trading or, if such capital stock is not
listed or admitted to trading on a United States national or
regional securities exchange, as reported by the National
Association of Securities Dealers Automated Quotation System
("NASDAQ") or by the National Quotation Bureau Incorporated. A
"Stock Trading Day" means each day on which the securities
exchange or quotation system which is used to determine the
Current Market Price is open for trading or quotation.
"Depositary Bank" -- see Section 1.2.
"Designated Subsidiary" shall mean any corporate
Subsidiary of the Company designated for borrowing privileges
under this Agreement pursuant to Section 13.10 hereof.
"Designation Letter" shall mean, in respect of any
Designated Subsidiary, a letter in the form of Exhibit E hereto
signed by such Designated Subsidiary and the Company.
"Dollars" and the sign "$" shall mean lawful money of
the United States of America.
"Domestic Loan" -- see definition below of "Loan."
"Equivalent Domestic Loan" -- see Section 6.3.
"Eurodollar Day" shall mean a day on which dealings are
carried on in the London Interbank market in Dollars and on which
banks are not authorized or required by law to close for business
in New York City.
"Eurodollar Interest Rate" -- see Section 3.1.2.
"Eurodollar Loan" -- see definition below of "Loan."
"Eurodollar Margin" -- see Section 3.1.8.
"Eurodollar Office" -- see Section 1.1.3.
"Eurodollar Period" shall mean, as to each Eurodollar
Loan, the period which shall begin on (and include) the most
recent Borrowing Date with respect to such Loan and shall end, as
Borrower shall elect in its notice pursuant to Section 1.2 or
5.4, as the case may be, on (and include) the day one, two, three
or six months thereafter, as selected by Borrower; provided that
no Eurodollar Period commencing prior to the Revolver Expiration
Date or the final maturity, by acceleration or otherwise, of all
of the Revolving Loans or Term Loans shall end later than such
Revolver Expiration Date or date of maturity, as the case may be.
Subject to the proviso in the preceding sentence, any Eurodollar
Period which would otherwise end on a day which would not be a
Eurodollar Day shall instead continue to and end on the next
succeeding Eurodollar Day, unless such next succeeding Eurodollar
Day would be the first Eurodollar Day in a calendar month, in
which case such Eurodollar Period shall instead end on the next
preceding Eurodollar Day, and any Eurodollar Period which begins
on the last Eurodollar 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 Eurodollar Period) shall end on the last
Eurodollar Day of a calendar month.
"Event of Default" shall mean any of the events
described in Section 11.1.
"Federal Funds Rate" shall mean for any period, a
fluctuating interest rate equal for each day during such period
to the weighted average of the rates on overnight Federal Funds
transactions with members of the Federal Reserve System arranged
by Federal Funds brokers, as published for each day (or, if such
day is not a Business Day, for the next preceding Business Day)
by the Federal Reserve Bank of New York, or, if such rate is not
so published for any day which is a Business Day, the average of
the quotations for such day on such transactions received by the
Depositary Bank from three Federal Funds brokers of recognized
standing selected by the Depositary Bank.
"Fixed Rate Interest Date" -- see Section 3.1.
"Fixed Rate Loan" -- see definition below of "Loan".
"GAAP" shall mean generally accepted accounting
principles set forth in the opinions and pronouncements of the
Accounting Principles Board of the American Institute of
Certified Public Accountants and statements and pronouncements of
the Financial Accounting Standards Board or in such other
statements by such other entity as may be approved by a
significant segment of the accounting profession, which are
applicable to the circumstances as of the date of determination.
"Increase Date" has the meaning assigned to that term
in Section 1.1.8.
"Indemnified Liabilities" -- see Section 13.9.
"Interest Date" shall mean Fixed Rate Interest Date
and/or Prime Rate Interest Date, as the case may be.
"Interest Period" shall mean a CD Interest Period or a
Eurodollar Period, as the context requires, or both.
"Liabilities" -- see Section 4.1.
"Loan" shall mean each lending by any Bank hereunder.
Particular types of Loans are as follows:
(i) "Alternate Currency Loan" shall mean any Loan
denominated in an Alternate Currency;
(ii) "CD Loan" shall mean any Loan which bears
interest at the CD Rate;
(iii) "Domestic Loan" shall mean any Loan which is
a Prime Rate Loan or a CD Loan;
(iv) "Eurodollar Loan" shall mean any Loan which
bears interest at the Eurodollar Interest Rate;
(v) "Fixed Rate Loan" shall mean a CD Loan or a
Eurodollar Loan;
(vi) "Market Rate Loan" -- see Section 1.3;
(vii) "Prime Rate Loan" shall mean any Loan bearing
interest at the Prime Rate;
(viii) "Revolving Loan" shall mean any Loan made
pursuant to the unused Commitments contained in Section 1.1.1 but
shall exclude any Market Rate Loan; and
(ix) "Term Loan" shall mean any Loan made pursuant
to the commitments contained in Section 1.1.2.
"Market Rate" -- see Section 1.3(a).
"Market Rate Loan" -- see definition above of "Loan."
"Market Rate Note" -- see Section 2.3.
"Notes" shall mean the Revolving Notes, Market Rate
Notes and Term Notes, or any of them.
"Obligations" see Section 10.1.
"Percentage" with respect to any Bank shall mean at
any time the percentage of the Credit represented by such Bank's
Commitment.
"Person" shall mean any corporation, partnership,
association, trust, individual or other entity.
"Prime Rate" shall mean the greater of: (a) the
average of the rates per annum from time to time announced by
each of the Reference Banks at the address set forth below its
signature hereto as such Bank's prime commercial lending rate and
(b) the effective Federal Funds Rate for overnight funds plus 1/2
of 1% per annum.
"Prime Rate Interest Date" -- see Section 3.1.
"Prime Rate Loan" -- see definition of "Loan" above.
"Public Debt Rating" means, as of any date, the
highest rating that has been most recently announced by either
Moody's Investors Service, Inc. ("Moody's") or Standard & Poor's
Corporation ("S&P") or an Alternate Rating Agency in substitution
for Moody's or S&P (but not both), for any class of long-term
unsecured senior debt issued by the Company; provided, that if
the ratings determined by Moody's or S&P (or an Alternate Rating
Agency) differ by more than one rating category the Public Debt
Rating shall be the average of the two ratings. For purposes of
the foregoing, (a) if an Alternate Rating Agency is used, the
ratings provided by such Alternate Rating Agency shall be
converted into an equivalent of Moody's or S&P, as nearly as
practicable, for purposes of determining the Eurodollar Margin
and CD Margin; and (b) if any rating established or deemed to
have been established by Moody's or S&P shall be changed (other
than as a result of a change in the rating system of either
Moody's or S&P), such change shall be effective as of the date on
which such change is first announced publicly by the rating
agency making such change. Any change in the Eurodollar Margin
or CD Margin due to a change in the Public Debt Rating shall be
effective for Interest Periods commencing after the public
announcement of the change in debt rating. If the rating system
of either Moody's or S&P shall change, the Company and the Banks
shall negotiate in good faith to amend the references to specific
ratings in this definition to reflect such changed rating system.
"Reference Banks" shall mean Chemical Bank,
NationsBank of North Carolina N.A., and The Chase Manhattan Bank,
N.A. or, with respect to Eurodollar Loans, the Eurodollar Office
of any of them.
"Regulation D" -- see Section 3.1.2.1.
"Revolver Expiration Date" means the earlier of
January 11, 1995 or the date of termination in whole of the
Commitments.
"Revolving Loan" -- see definition above of "Loan."
"Revolving Note" -- see Section 2.1.
"Significant Subsidiary" shall have the meaning
assigned to such term in Regulation C Section 230.405 promulgated by
the Securities and Exchange Commission pursuant to the Securities
Act of 1933, as amended, as such definition is in effect as of
the date of this Agreement.
"Subsidiary" shall mean a corporation of which the
Company and its other Subsidiaries own directly or indirectly
more than 50% of the ordinary voting power for the election of
directors.
"Term Loan" -- see definition above of "Loan."
"Term Note" -- see Section 2.2.
ARTICLE XIII
GENERAL
SECTION 13.1. Waiver; Amendments. No delay on the
part of any Bank or the holder of any Note in the exercise of any
right, power or remedy shall operate as a waiver thereof, nor
shall any single or partial exercise by any of them of any right,
power or remedy preclude other or further exercise thereof, or
the exercise of any other right, power or remedy. No amendment,
modification or waiver of, or consent with respect to, any
provision of this Agreement or the Notes shall in any event be
effective unless the same shall be in writing (including telegram
or telex) and signed and delivered by the Company and Banks
having an aggregate Percentage of not less than the Percentage
expressly designated herein with respect thereto or, in the
absence of such designation as to any provision of this Agreement
or the Notes, by Banks having, in the aggregate, a Percentage of
66 2/3% or more, and then any such amendment, modification,
waiver or consent shall be effective only in the specific
instance and for the specific purpose for which given. No
amendment, modification, waiver or consent (i) shall extend or
increase the amount of the Credit, the scheduled maturity of the
Notes, or the scheduled date for the payment of interest or fees,
or reduce the fees or the rate of interest payable with respect
to the Notes or modify the provisions of Section 3.1.5, 3.1.7,
4.5, 6.3, 6.4, or 13.9 or modify the provisions of Article X in
a manner adverse to the Banks or impose an additional obligation
on any of the Banks or reduce the aggregate Percentage required
to effect an amendment, modification, waiver or consent without
the consent of all of the Banks or (ii) shall extend the
scheduled maturity of, or the scheduled date for the payment of
interest or fees on, or reduce the principal amount of, or rate
of interest on, any Note without the consent of the holder of
such Note. The provisions of this Section 13.1 may not be
amended or modified without the consent of all of the Banks.
SECTION 13.2. Confirmations. Borrower and each
holder of a Revolving Note agree from time to time, upon written
request received by it from the other, to confirm to the other in
writing the aggregate unpaid principal amount of the Revolving
Loans then outstanding under such Revolving Note; and each such
holder agrees from time to time, upon written request received by
it from Borrower, to make the Revolving Note held by it
(including the schedule attached thereto) available for
reasonable inspection by Borrower at the office of such holder.
Each Bank shall, promptly upon request by Borrower, furnish
Borrower with a photocopy of the schedule attached to such Bank's
Revolving Note.
SECTION 13.3. Notices. Any notice from Borrower to
any Bank (including Depositary Bank) under Section 1.2, 1.1.6,
1.1.8 or 5.4 may be (i) telephonic if confirmed, prior to the
date for taking (or for the effectiveness of) the action
specified in such notice, by a writing received by such Bank or
(ii) by facsimile if confirmed, prior to the date for taking (or
for the effectiveness of) the action specified in such notice, by
telephone. Any other notice hereunder to Borrower or any Bank
(or other holder) shall, except as otherwise expressly provided,
be in writing and, if mailed shall be deemed to have been given
(i) three days after the date when sent by first class mail,
postage prepaid, (ii) one day after sent by overnight delivery
service and, in each case, addressed to Borrower or such Bank (or
other holder) at its address shown below its signature hereto, or
at such other address as it may, by written notice received by
the other parties to this Agreement, have designated as its
address for such purpose. Any Bank or the holder of any Note
giving any waiver, consent or notice to, or making any request
upon, Borrower hereunder shall promptly notify the Depositary
Bank thereof.
SECTION 13.4. 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
generally accepted accounting principles as in effect from time
to time ("GAAP"), applied on a basis consistent (except for
changes concurred in 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 Depositary Bank that it wishes to amend any covenant in
Article VIII to eliminate the effect of any change in generally
accepted accounting principles on the operation of such covenant,
then compliance with such covenant 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 covenant is amended in a manner satisfactory
to the Company and Banks holding, in the aggregate, a Percentage
of 66 2/3% or more.
SECTION 13.5. Participations; Transfers of Notes.
A Bank may assign or sell participations in all or any part of
its Commitment or any Loan to another bank or other entity;
provided that an assignment or participation shall be in a
minimum aggregate amount of $10,000,000; and provided, further
(a) except in the case of assignments of or participations in
Market Rate Loans, that the Company shall have consented in
writing to the proposed assignment or participation, which
consent shall not be unreasonably withheld; and (b) in the case
of a participation, no such participation shall in any way affect
such Bank's obligations under this Agreement, and provided, that
all amounts payable by any Borrower under Article III shall be
determined as if such Bank had not sold such participation. Upon
execution and delivery of an appropriate instrument and payment
by any assignee to the 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
Commitments 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. Upon the consummation of
any assignment pursuant to this Section 13.5, the transferor Bank
and the Borrower shall make approriate arrangements so that, if
required, a new Note is issued to the assignee.
The agreement executed by the Bank in favor of any
participant shall not give the participant the right to require
such Bank to take or omit to take any action hereunder except
action directly relating to (i) the extension of a payment date
with respect to any portion of the principal of or interest on
any amount outstanding or any fees payable hereunder allocated to
such participant, (ii) the reduction of the principal amount of
any Loan outstanding hereunder, (iii) the reduction of the rate
of interest payable on such amount or any amount of fees payable
hereunder to a rate or amount, as the case may be, below that
which the participant is entitled to receive under its agreement
with such Bank, or (iv) an extension of the Revolver Expiration
Date in accordance with the terms hereof. Each Bank may furnish
to participants (including prospective participants and
prospective assignees) any information in the possession of such
Bank from time to time concerning any Borrower; provided, that
such Bank shall require any such participant or assignee
(prospective or otherwise) to agree in writing to maintain the
confidentiality of such information; and provided further, that
such Bank may not furnish to the participant or assignee any
information which the Borrower has identified in writing to such
Bank to be trade secrets or proprietary information.
If, pursuant to this Section 13.5, any interest in this Agreement
or any Note is transferred to any assignee which is organized
under the laws of any jurisdiction other than the United States
or any state thereof, the transferor Bank shall cause such
assignee concurrently with the effectiveness of such transfer,
(i) to represent to the transferor Bank (for the benefit of the
transferor Bank and the Company) that it is either (x) entitled
to the benefits of an income tax treaty with the United States
which provides for an exemption from United States withholding
tax on interest and other payments which may be made by the
Company to such Bank pursuant to the terms of this Agreement or
any other credit document; or (y) engaged in a trade or business
within the United States, (ii) to furnish to the transferor Bank
and the Company either U.S. Internal Revenue Service Form 4224 or
U.S. Internal Revenue Service Form 1001 (wherein such assignee
claims entitlement to complete exemption from U.S. federal
withholding tax on all payments hereunder) and (iii) to agree
(for the benefit of the transferor Bank and the Company) to
provide to the transferor Bank and the Company a new Form 4224 or
Form 1001 upon the obsolescence of any previously delivered form
and comparable statements in accordance with applicable U.S. laws
and regulations and amendments duly executed and completed by
such assignee, and to comply from time to time with all
applicable U.S. laws and regulations with regard to such
withholding tax exemption.
Notwithstanding anything to the contrary in this Section 13.5,
any Bank may pledge and assign its rights hereunder and under the
Notes held by it to a Federal Reserve Bank as collateral.
SECTION 13.6. Regulation U. Each Bank represents
that it is not relying, either directly or indirectly, upon any
margin stock (as such term is defined in Regulation U promulgated
by the Board of Governors of the Federal Reserve System) as
collateral security for the extension or maintenance by it of any
credit provided for in this Agreement.
SECTION 13.7. Confidentiality of Information. Each
Bank understands that some of the information furnished pursuant
to this Agreement or obtained by such Bank pursuant to any
inspection made in accordance with Section 8.2 may, at the time
furnished or obtained, not have been made public, and each Bank
agrees to keep confidential all such information and will make no
use of such information until it shall have become public except
in connection with this Agreement and with such Bank's outside
counsel and accountants, subject however to each Bank's
obligations under law or pursuant to subpoenas or other process
to make information available to governmental agencies and
examiners or to others.
SECTION 13.8. Limitation on Interest. No provision
of this Agreement or any Note shall require the payment or permit
the collection of interest in excess of the maximum rate
permitted by applicable law.
SECTION 13.9. Costs, Expenses and Taxes. The
Company shall pay all reasonable out-of-pocket expenses of the
Depositary Bank and the Banks (but excluding the fees and
disbursements of counsel to the Depositary Bank and the Banks) in
connection with the preparation of this Agreement and all
instruments and documents relating thereto or necessary to
satisfy the conditions to lending hereunder. The Company agrees
to pay on demand all out-of-pocket costs and expenses (including
reasonable attorneys' fees and legal expenses) incurred by each
Bank and the Depositary Bank in connection with the enforcement
of this Agreement, the Notes, any such other instruments or
documents or any collateral security. In addition, each Borrower
agrees (i) to pay, and to save the Depositary Bank and the Banks
harmless from all liability for, any stamp or other taxes which
may be payable in connection with the execution or delivery of
this Agreement, the borrowings hereunder, or the issuance of the
Notes or of any other instruments or documents provided for
herein or delivered or to be delivered hereunder or in connection
herewith and (ii) to indemnify, exonerate and hold each of the
Depositary Bank and the Banks and each of the officers,
directors, employees and agents of such Banks (herein called
collectively the "Bank Indemnitees") free and harmless from and
against any and all actions, causes of action, suits, losses,
liabilities, damages and expenses, including, without limitation,
reasonable attorneys' fees and disbursements incurred by any Bank
Indemnitee as a result of, or arising out of, or relating to any
transaction financed with proceeds of any of the Loans or the
execution, delivery, performance, enforcement or administration
of this Agreement (herein called collectively the "Indemnified
Liabilities"), except for any such Indemnified Liabilities
arising on account of any such Bank Indemnitee's negligence or
willful misconduct, and if and to the extent that the foregoing
undertaking may be unenforceable for any reason, Borrower hereby
agrees to make the maximum contribution to the payment and
satisfaction of each of the Indemnified Liabilities which is
permissible under applicable law.
SECTION 13.10. Designated Subsidiaries. (i)
Designation. The Company may at any time, and from time to time,
by delivery to the Depositary Bank of a Designation Letter duly
executed by the Company and the respective Subsidiary, designate
such Subsidiary as a "Designated Subsidiary" for purposes of this
Agreement and such Subsidiary shall thereupon become a
"Designated Subsidiary" for purposes of this Agreement. The
Depositary Bank shall promptly notify each Bank of each such
designation by the Company and the identity of the respective
Subsidiary.
(ii) Termination. Upon the payment and performance
in full of all of the Obligations of any Designated Subsidiary
then, so long as at the time no request for a Fixed Rate Loan to
such Designated Subsidiary is outstanding, such Subsidiary's
status as a "Designated Subsidiary" shall terminate upon notice
to such effect from the Company to the Depositary Bank (which
notice the Depositary Bank shall deliver to each Bank).
Thereafter, the Banks shall be under no further obligation to
make any Loan hereunder to such Designated Subsidiary.
SECTION 13.11. Captions. Captions used in this
Agreement are for convenience only and shall not affect the
construction of this Agreement.
SECTION 13.12. Governing Law; Submission to
Jurisdiction. This Agreement and each Note shall be a contract
made under and governed by the internal laws of the State of New
York. All obligations of Borrower and rights of the Banks and
any other holders of the Notes expressed herein or in the Notes
shall be in addition to and not in limitation of those provided
by applicable law. The Borrowers hereby submit 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. The Borrowers irrevocably waive, to the
fullest extent permitted by law, any objection which the 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 13.13. Counterparts. This Agreement may be
executed in any number of counterparts and by the different
parties on separate counterparts (provided, however, that each
such counterpart shall be executed by the Company) and each such
counterpart shall be deemed to be an original, but all such
counterparts shall together constitute but one and the same
Agreement.
SECTION 13.14. Effectiveness. When counterparts
executed by all the Banks shall have been lodged with the Company
and counterparts executed by the Company shall have been lodged
with each Bank this Agreement shall become effective as of
January 12, 1994.
SECTION 13.15. Successors and Assigns. This
Agreement shall be binding upon Borrower and the Banks and their
respective successors and assigns, and shall inure to the benefit
of the Borrower and the Banks and the respective successors and
assigns of the Banks, except that the Company may not assign or
transfer any of its rights or obligations under this Agreement
without the prior written consent of Banks having, in the
aggregate, a Percentage of at least 100%.
SECTION 13.16. Duties of Depositary Bank. The
Depositary Bank shall have no duties or responsibilities except
those expressly set forth in this Agreement and neither the
Depositary Bank nor any of its directors, officers, employees or
agents shall be liable or responsible for any action taken or
omitted to be taken by it or them hereunder, or in connection
herewith, except for its or their own gross negligence or willful
misconduct. In addition, the Banks agree to indemnify the
Depositary Bank, ratably in accordance with the aggregate unpaid
principal amount of the Loans made by the Banks (or, if no Loans
are at the time outstanding, ratably in accordance with their
respective Percentages), for any and all liabilities,
obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements of any kind and nature
whatsoever which may be imposed on, incurred by or asserted
against the Depositary Bank in any way relating to or arising out
of the duties and responsibilities of the Depositary Bank
expressly set forth in this Agreement; provided that (i) the
Banks shall only be liable to the extent the Borrower fails to
indemnify and pay the Depositary Bank pursuant to Section 13.9
hereof, and (ii) no Bank shall be liable for any of the foregoing
to the extent they arise from the gross negligence or willful
misconduct of the Depositary Bank.
SECTION 13.17. Severability. In case any one or
more of the provisions contained in this Agreement or the Notes
should be invalid, illegal or unenforceable in any respect, the
validity, legality and enforceability of the remaining provisions
contained herein and therein shall not in any way be affected or
impaired thereby.
SECTION 13.18. Representation of the Banks. Each
Bank represents and warrants to the Borrower that it is (x) a
United States person (as defined in Section 7701(a) (30) of the
Internal Revenue Code of 1986, as amended (the "Code")); (y)
entitled to the benefits of an income tax treaty with the United
States which provides for an exemption from United States
withholding tax on interest and other payments which may be made
by the Borrower to such Bank pursuant to the terms of this
Agreement; or (z) engaged in a trade or business within the
United States. Each Bank that is organized under the laws of any
jurisdiction other than the United States or any State thereof
(including the District of Columbia) agrees to furnish to the
Borrower, prior to the date of the first interest payment
hereunder, two copies of either U.S. Internal Revenue Service
Form 4224 or U.S. Internal Revenue Service Form 1001 (wherein
such Bank claims entitlement to complete exemption from U.S.
federal withholding tax on all payments hereunder) and to provide
to the Borrower a new Form 4224 or Form 1001 upon the
obsolescence of any previously delivered form and comparable
statements in accordance with applicable U.S. laws and
regulations and amendments duly executed and completed by such
Bank, and to comply from time to time with all applicable U.S.
laws and regulations with regard to such withholding tax
exemptions. Notwithstanding any other provisions of this
Agreement, the representations, warranties and obligations of the
Banks set forth in Section 13.5 and this Section 13.18 shall
survive the borrowing of the Loans and the assignment, sale,
repayment or other disposition of the Loans or any interest
therein.
SECTION 13.19. Survival. The obligations of the
Borrower under Sections 3.1.5, 3.1.7, 4.5 and 13.9 shall survive
the termination of this Agreement and the payment of all Loans.
SECTION 13.20. WAIVER OF TRIAL BY JURY. TO THE
EXTENT PERMITTED BY APPLICABLE LAW, THE BORROWER AND EACH OF THE
BANKS HEREBY IRREVOCABLY WAIVE ALL RIGHT OF TRIAL BY JURY IN ANY
ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR IN
CONNECTION WITH THIS AGREEMENT OR ANY MATTER ARISING HEREUNDER.
IN WITNESS WHEREOF, the Company and each Bank have
caused this Agreement to be executed, as of the day and year
first above written, by one of its officers thereunto duly
authorized.
GENERAL SIGNAL CORPORATION
By: /s/ Julian B. Twombly
Vice President and Treasurer
High Ridge Park
Stamford, Connecticut 06904
Attention: Treasurer
Telecopier No.: (203) 329-4365
Amount of
Commitment
$17,777,778
THE CHASE MANHATTAN BANK, N.A.
By: /s/ Edward F. McNulty
Title: Managing Director
Lending Office for Loans
The Chase Manhattan Bank, N.A.
One Chase Plaza, 17th Floor
New York, New York 10081
Attn: Edward F. McNulty
Telecopy No.: (212) 552-1457
Amount of
Commitment
$17,777,778
CHEMICAL BANK
By: /s/ Robert C. Kennedy
Title: Vice President
Lending Office for Loans
Chemical Bank
270 Park Avenue
New York, New York 10017
Attn: Robert C. Kennedy
Telecopy No: (212) 270-7138
Amount of
Commitment
$17,777,778
NATIONSBANK OF NORTH CAROLINA, N.A
By: /s/ Margaret K. Vandenberg
Title: Vice President
Lending Office for Loans
NationsBank of North Carolina, N.A.
NationsBank Plaza
Charlotte, North Carolina 28255
Attn: Lisa McClelland NCI-002-17-21
Telecopy No: (704) 386-8694
cc: Margaret K. Vandenberg
NationsBank of North Carolina, N.A.
767 Fifth Avenue
New York, New York 10153
Telecopy No: (212) 593-1083
Amount of
Commitment
$17,777,778
WACHOVIA BANK OF GEORGIA, N.A.
By: /s/ Linda M. Harris
Title: Senior Vice President
Lending Office for Loans
Wachovia Bank of Georgia, N.A.
191 Peachtree Street, N.E.
Atlanta, Georgia 30303
Attn: Walter R. Gillikin
Telecopy No: (404) 332-6898
Amount of
Commitment
$11,111,111
CANADIAN IMPERIAL BANK OF COMMERCE
By: /s/ Brian E. O'Callahan
Title: Authorized Signatory
Lending Office for Loans
Canadian Imperial Bank of Commerce
425 Lexington Avenue
New York, New York 10017
Attn: Brian E. O'Callahan
Telecopy No: (212) 856-3991
Amount of
Commitment
$11,111,111
COMMERZBANK A.G.
By: /s/ Juergen Boysen
Title: Senior Vice President
By: /s/ Christian Jagenberg
Title: Vice President
Lending Office for Loans
CommerzBank A.G.
2 World Financial Center
New York, New York 10281-1050
Attn: J.F. Christian Jagenberg
Telecopy No: (212) 266-7235
Amount of
Commitment
$11,111,111
THE FIRST NATIONAL BANK OF CHICAGO
By: /s/ James W. Peterson
Title: Vice President
Lending Office for Loans
The First National Bank of Chicago
153 West 51st Street
New York, New York 10019
Attn: James W. Peterson
Telecopy No: (212) 373-1388
Amount of
Commitment
$11,111,111
THE HONGKONG & SHANGHAI BANKING
CORPORATION LIMITED
By: /s/ Jeffry S. Dykes
Title: Vice President
Lending Office for Loans
The Hongkong & Shanghai Banking
Corporation Limited
140 Broadway, 4th Floor
New York, New York 10015
Attn: Jeffry S. Dykes
Telecopy No: (212) 658-5109
Amount of
Commitment
$11,111,111
NATIONAL WESTMINSTER BANK Plc
By: /s/ Anthony G. Muller
Title: Vice President
Lending Office for Loans
National Westminster Bank Plc
Corporate and Institutional Finance
175 Water Street
New York, New York 10038-4924
Attn: Anthony G. Muller
Telecopy No: (212) 602-4500
Amount of
Commitment
$11,111,111
THE NORTHERN TRUST COMPANY
By: /s/ Gregory Werd
Title: Vice President
Lending Office for Loans
The Northern Trust Company
50 South LaSalle Street
Chicago, Illinois 60675
Attn: Gregory F. Werd, Jr.
Telecopy No: (312) 444-3508
Amount of
Commitment
$11,111,111
THE SANWA BANK LIMITED
By: /s/ Stephen C. Small
Title: Vice President
Lending Office for Loans
The Sanwa Bank Limited
New York Branch
Park Avenue Plaza
55 East 52nd Street
New York, New York 10055
Attn: Stephen C. Small
Telecopy No: (212) 754-1304
Amount of
Commitment
$11,111,111
SHAWMUT BANK
By: /s/ John F. Wood
Title: Senior Vice President
Lending Office for Loans
Shawmut Bank
777 Main Street
MSN 203
Hartford, Connecticut 06115
Attn: Christopher Mango
Telecopy No: (203) 722-9378
EXHIBIT A
REVOLVING NOTE
$ , 199
The undersigned, for value received, promises to pay to
the order of
on
or before the Revolver Expiration Date, as defined in the 364 Day
Credit Agreement referred to below, the principal sum of
Dollars or, if less, the aggregate
unpaid principal amount of all Revolving Loans made by the payee
to the undersigned pursuant to the 364 Day Credit Agreement (as
hereinafter defined) as shown on the schedule attached hereto
(and any continuation thereof), together, from time to time, with
interest on the unpaid principal amount hereof from time to time
outstanding as provided in Article III of the 364 Day Credit
Agreement hereinafter referred to (but in no event higher than
the maximum rate permitted by applicable law).
Payments of both principal and interest are to be made
in lawful money of the United States of America for the account
of the payee at the office of The Chase Manhattan Bank, N.A., at
One Chase Manhattan Plaza, New York, New York 10081 in
immediately available funds.
This Note evidences indebtedness incurred under, and is
subject to the terms and provisions of, a 364 Day Credit
Agreement dated as of January 12, 1994, (and, all further
amendments thereto, if any) among the undersigned and certain
banks (including the payee) to which 364 Day Credit Agreement
reference is hereby made for a statement of said terms and
provisions, including those under which this Note may be paid, or
may be declared to be due and payable, prior to its due date.
This Note is made under and governed by the internal
laws of the State of New York.
[BORROWER]
By
Title
Schedule Attached to Revolving Note dated , 199 of
[Borrower] payable to the order of
LOANS AND PRINCIPAL PAYMENTS
Beginning
and End
Eurodollar
or CD Amount of Unpaid
Amount of Interest Principal Principal Notation
Date Loan Made Period Repaid Balance Made By
EXHIBIT B
TERM NOTE
$ , 199
The undersigned, for value received, promises to pay to
the order of
the
principal sum of
Dollars
payable on January 11, 1996 together, from time to time, with
interest on the unpaid principal amount hereof from time to time
outstanding as provided in Article III of the 364 Day Credit
Agreement hereinafter referred to (but in no event higher than
the maximum rate permitted by law).
Payments of both principal and interest are to be made
in lawful money of the United States of America for the account
of the payee at the office of The Chase Manhattan Bank, N.A., at
One Chase Manhattan Plaza, New York, New York 10081 in
immediately available funds.
This Note evidences indebtedness incurred under, and is
subject to the terms and provisions of, a 364 Day Credit
Agreement dated as of January 12, 1994, (and, all further
amendments thereto, if any) among the undersigned and certain
banks (including the payee), to which 364 Day Credit Agreement
reference is hereby made for a statement of said terms and
provisions, including those under which this Note may be paid, or
may be declared to be due and payable, prior to its due date.
This Note is made under and governed by the internal
laws of the State of New York.
[BORROWER]
By
Title
EXHIBIT C
Market Rate Promissory Note
$ , 199
The undersigned, for value received, promises to pay to
the order of
on
or before the Revolver Expiration Date, as defined in the 364 Day
Credit Agreement referred to below, the principal sum of
Dollars or the equivalent in any
Alternate Currency shown on the schedule attached hereto or, if
less, the aggregate unpaid principal amount of all Market Rate
Loans made by the payee to the undersigned pursuant to the 364
Day Credit Agreement (as hereinafter defined) as shown on the
schedule attached hereto (and any continuation thereof),
together, from time to time, with interest on the unpaid
principal amount hereof from time to time outstanding as provided
in Article III of the 364 Day Credit Agreement hereinafter
referred to (but in no event higher than the maximum rate
permitted by applicable law).
Payments of both principal and interest are to be made
in lawful money of the United States of America or an Alternate
Currency if so specified with respect to any Market Rate Loan on
the schedule attached hereto in immediately available funds to,
in the case of loans in Dollars the account specified by the
payee and, in the case of Alternate Currency Loans, the Alternate
Currency Payment Office.
This Note evidences indebtedness incurred under, and is
subject to the terms and provisions of, a 364 Day Credit
Agreement dated as of January 12, 1994, (and, all further
amendments thereto, if any) among the undersigned and certain
banks (including the payee) to which 364 Day Credit Agreement
reference is hereby made for a statement of said terms and
provisions, including those under which this Note may be paid, or
may be declared to be due and payable, prior to its due date.
This Note is made under and governed by the internal
laws of the State of New York.
[BORROWER]
By
Title
SCHEDULE ATTACHED TO MARKET RATE PROMISSORY NOTE
DATED AS OF FROM
[BORROWER] TO
____________________
ALTERNATE AMOUNT OF UNPAID
AMOUNT CURRENCY MATURITY PRINCIPAL PRINCIPAL
DATE OF LOAN (if applicable) DATE RATE REPAID BALANCE
EXHIBIT D
FORM OF ATTORNEY'S OPINION OF COUNSEL TO BORROWER
Per Section 9.1.5
[Letterhead of Messrs. Cahill Gordon & Reindel]
Each of the Commercial Banking Institutions
listed on Schedule I hereto
Re: General Signal Corporation 364 Day Credit
Agreement, Dated as of January 12, 1994
Gentlemen:
We have acted as counsel to General Signal
Corporation, a New York corporation (the "Company"), in
connection with the 364 Day Credit Agreement, dated as of
January 12, 1994 ("Agreement"), between you and the Company,
covering loans by you to Borrower to be evidenced by the Notes.
Capitalized terms used herein and not otherwise defined herein
shall have the meanings assigned to them in the 364 Day Credit
Agreement.
We have examined originals, photocopies or conformed
copies of such records of the Company and its subsidiaries and
such agreements, certificates of public officials, certificates
of officers and representatives of the Company and its
subsidiaries and such other documents as we have deemed
relevant and necessary as a basis for the opinions hereinafter
expressed. In such examinations, we have assumed the
genuineness of all signatures on original documents and the
conformity to the originals of all copies submitted to us as
conformed or photocopies. As to various questions of fact
material to the opinions expressed herein, we have relied upon
representations, statements or certificates of public
officials, officers and representatives of the Company and its
subsidiaries and others.
We are of the opinion that:
(1) The Company is a corporation duly organized,
validly existing and in good standing under the laws of
the State of New York and in good standing in the State of
Connecticut.
(2) The execution, delivery and performance of the
Agreement and the Notes, and the borrowings by the Company
pursuant thereto, are within the Company's corporate
powers and have been duly authorized by all necessary
corporate action.
(3) No governmental approval of the actions referred
to in (2) above is required.
(4) The actions referred to in (2) above do not
contravene or conflict with any provision of law, the
Articles of Incorporation or By-laws of the Company, or
any material agreement, indenture or instrument which is
binding on or applicable to the Company of which we have
knowledge.
(5) The Agreement is, and each of the Notes, when
executed and delivered for the consideration as
contemplated by the Agreement will be, the legally valid
and binding obligation of the Company, enforceable against
Borrower in accordance with their respective terms, except
that (i) such enforceability may be limited by generally
applicable bankruptcy, insolvency, moratorium, fraudulent
transfer or conveyance or other similar laws affecting the
enforcement of creditors' rights generally and (ii) no
opinion has been requested or is being rendered as to the
availability of equitable remedies, such as, for example,
specific performance or injunctive relief, which are
within the discretion of courts of applicable
jurisdiction.
(6) The Company is not (i) an "investment company,"
or a company "controlled" by an "investment company,"
within the meaning of the Investment Company Act of 1940,
as amended, or (ii) a public utility or a public utility
holding company as defined in the Public Utility Holding
Company Act of 1935.
Our opinion in (4) above is based, in part, upon the
accuracy of the representations contained in Section 13.6 of
the Agreement.
We are members of the Bar of the State of New York
and we express no opinion herein with respect to any law other
than the laws of the State of New York and the federal law of
the United States.
Very truly yours,
EXHIBIT E
FORM OF DESIGNATION LETTER
, 199
To each of the Banks party to the
364 Day Credit Agreement (as defined below)
Ladies and Gentlemen:
Reference is made to the 364 Day Credit Agreement
dated as of January 12, 1994, among General Signal Corporation
(the "Company") and the Banks named therein (the "Credit
Agreement"). Terms used herein and defined in the Credit
Agreement shall have the respective meanings ascribed to such
terms in the Credit Agreement.
Please be advised that the Company hereby designates
its undersigned Subsidiary, ("Designated
Subsidiary"), as a "Designated Subsidiary" under and for all
purposes of the Credit Agreement.
The Designated Subsidiary, in consideration of each
Bank's agreement to extend credit to it under and on the terms
and conditions set forth in the Credit Agreement, does hereby
assume each of the obligations imposed upon a "Designated
Subsidiary" and a "Borrower" under the Credit Agreement and
agrees to be bound by the terms and conditions of the Credit
Agreement. In furtherance of the foregoing, the Designated
Subsidiary hereby represents and warrants to each Bank as
follows:
1. The Designated Subsidiary is a corporation duly
incorporated, validly existing and in good standing under
the laws of .
2. The delivery of this Designation Letter, the
borrowings under the Credit Agreement, the execution and
delivery of the Notes, and the performance by the
Designated Subsidiary of its obligations under the Credit
Agreement, the Designation Letter and the Notes, are
within the Borrower's corporate powers, have been duly
authorized by all necessary corporate action, have
received all necessary governmental approval (if any shall
be required), and do not and will not violate, contravene
or conflict in any material respect with any provision of
law or of the charter or by-laws of the Designated
Subsidiary or of any judgment or any material agreement or
indenture binding upon or applicable to the Designated
Subsidiary the contravention of or conflict with which
would materially adversely affect the consolidated
financial condition or continued operations of the
Designated Subsidiary as a whole or materially impair the
ability of the Designated Subsidiary to perform any of its
obligations hereunder.
This Designation Letter and the Credit Agreement, and
the Notes when duly executed and delivered by the
Designated Subsidiary will be, legal, valid and binding
obligations of the Designated Subsidiary enforceable
against it in accordance with their respective terms,
subject only to bankruptcy, insolvency, reorganization,
moratorium or similar laws affecting the enforceability of
rights of creditors generally.
3. No litigation or arbitration proceedings are
pending or, to the knowledge of the Designated Subsidiary,
threatened against the Designated Subsidiary as to which
there is a reasonable likelihood of an adverse
determination and which would reasonably be expected to
have a material adverse effect on the ability of the
Designated Subsidiary to pay its debts (including the
Loans made to it under the Credit Agreement) as the same
become due and payable.
4. No authorizations, consents, approvals,
licenses, filings or registrations by or with any
governmental authority or administrative body are required
in connection with the execution, delivery or performance
by the Designated Subsidiary of this Designation Letter
and the Credit Agreement except for such authorizations,
consents, approvals, licenses, filings or registrations as
have heretofore been made, obtained or effected and are in
full force and effect.
5. The Designated Subsidiary is not, and
immediately after the application by the Designated
Subsidiary of the proceeds of each Loan will not be,
(a) an "investment company" within the meaning of the
Investment Company Act of 1940, as amended, or (b) a
"holding company" within the meaning of the Public Utility
Holding Company Act of 1935, as amended.
Very truly yours,
GENERAL SIGNAL CORPORATION [THE DESIGNATED SUBSIDIARY]
By________________________ By_________________________
Title: Title:
EXHIBIT F
FORM OF ATTORNEY'S OPINION OF
COUNSEL TO A DESIGNATED SUBSIDIARY
Each of the Commercial Banking Institutions
listed on Schedule I hereto
Re: General Signal Corporation 364 Day Credit
Agreement Dated as of January 12, 1994
Gentlemen:
We have acted as counsel to [Designated Subsidiary],
a corporation (the "Designated
Subsidiary"), in connection with the 364 Day Credit Agreement,
dated as of January 12, 1994 ("Agreement"), between you and the
Company, covering loans by you to Borrower to be evidenced by
the Notes. Capitalized terms used herein and not otherwise
defined herein shall have the meanings assigned to them in the
Agreement.
We have examined originals, photocopies or conformed
copies of such records of the Designated Subsidiary and such
agreements, certificates of public officials, certificates of
officers and representatives of the Designated Subsidiary and
its subsidiaries and such other documents as we have deemed
relevant and necessary as a basis for the opinions hereinafter
expressed. In such examinations, we have assumed the
genuineness of all signatures on original documents and the
conformity to the originals of all copies submitted to us as
conformed or photocopies. As to various questions of fact
material to the opinions expressed herein, we have relied upon
representations, statements or certificates of public
officials, officers and representatives of the Designated
Subsidiary and others.
We are of the opinion that:
(1) The Designated Subsidiary is a corporation duly
organized, validly existing and in good standing under the
laws of .
(2) The execution, delivery and performance by the
Designated Subsidiary of the Designation Letter, and the
Notes to be executed by the Designated Subsidiary, and the
borrowings by the Designated Subsidiary pursuant thereto,
are within the Designated Subsidiary's corporate powers
and have been duly authorized by all necessary corporate
action.
(3) No governmental approval of the action referred
to in (2) above is required.
(4) The actions referred to in (2) above to not
contravene or conflict with any provision of law, the
Charter or By-laws of the Designated Subsidiary, or any
material agreement, indenture or instrument which is
binding on or applicable to the Designated Subsidiary of
which we have knowledge.
(5) The Designation Letter is, and each of the Notes
to be executed by the Designated Subsidiary, when executed
and delivered for the consideration as contemplated by the
Agreement will be, the legally valid and binding
obligation of the Designated Subsidiary, enforceable
against Borrower in accordance with their respective
terms, except that (i) such enforceability may be limited
by generally applicable bankruptcy, insolvency,
moratorium, fraudulent transfer or conveyance or other
similar laws affecting the enforcement of creditors'
rights generally and (ii) no opinion has been requested or
is being rendered as to the availability of equitable
remedies, such as, for example, specific performance or
injunctive relief, which are within the discretion of
courts of applicable jurisdiction.
(6) The Company is not (i) an "investment company,"
or a company "controlled" by an "investment company,"
within the meaning of the Investment Company Act of 1940,
as amended, or (ii) a public utility or a public utility
holding company has defined in the Public Utility Holding
Company Act of 1935.
Our opinion in (4) above is based, in part, upon the
accuracy of the representations contained in Section 13.6 of
the agreement.
Very truly yours,
[CONFORMED AS EXECUTED]
FOUR YEAR CREDIT AGREEMENT
dated as of January 12, 1994
among
GENERAL SIGNAL CORPORATION
and
VARIOUS COMMERCIAL BANKING INSTITUTIONS
TABLE OF CONTENTS
Page
ARTICLE I COMMITMENTS OF BANKS; BORROWING
PROCEDURES AND CONDITIONS
1.1. Commitments . . . . . . . . . . . . . . . . 1
1.1.1. Revolving Loan Commitments . . . . 1
1.1.2. Term Loan Commitments . . . . . . . 2
1.1.3. Domestic and Eurodollar
Loan Commitments . . . . . . . . 2
1.1.4. Commitment Limits . . . . . . . . . 2
1.1.5. Mandatory Reduction of the
Commitments . . . . . . . . . . . 3
1.1.6. Optional Pro Rata Reduction . . . . 3
1.1.7. Optional Non-Pro Rata Reduction . . 3
1.1.8. Increase in Commitments . . . . . . 4
1.2. Borrowing Procedures . . . . . . . . . . . . 5
1.3. Market Rate Loans . . . . . . . . . . . . 6
1.4. Conditions to Each Loan . . . . . . . . . . 7
ARTICLE II NOTES EVIDENCING LOANS
2.1. Revolving Notes . . . . . . . . . . . . . . 7
2.2. Term Notes . . . . . . . . . . . . . . . . . 8
2.3. Market Rate Notes . . . . . . . . . . . . . 8
ARTICLE III INTEREST AND FEES
3.1. Interest . . . . . . . . . . . . . . . . . . 8
3.1.1. Interest on Domestic Loans . . . . 9
3.1.1.1. Revolving Loans and
Term Loans . . . . . . . 9
3.1.1.2. Changes in Prime Rate . . 9
3.1.2. Interest on Eurodollar Loans . . . 9
3.1.2.1. Revolving Loans and
Term Loans . . . . . . . 9
3.1.2.2. After Maturity . . . . . 10
3.1.3. Notice of CD Rate or
Eurodollar Interest Rate . . . . 10
3.1.4. Rate Determination
Conclusive . . . . . . . . . . . 10
3.1.5. Increased Cost of Fixed
Rate Loans . . . . . . . . . . . 11
3.1.6. Interest on Market Rate Loans . . . 12
3.1.7. Additional Costs . . . . . . . . . 13
3.1.8. Applicable Margin . . . . . . . . . 14
3.2. Facility Fee . . . . . . . . . . . . . . . . 14
3.3. Basis of Computation . . . . . . . . . . . . 15
3.4. Extension of Due Date . . . . . . . . . . . 15
3.5. Interest Rate Determination . . . . . . . . 16
3.6. Currency Equivalents . . . . . . . . . . . . 16
ARTICLE IV PREPAYMENTS
4.1. Prepayment upon Reduction or Termination
of the Credit . . . . . . . . . . . . . . 17
4.2. Change in Law Rendering Fixed Rate Loans
Unlawful . . . . . . . . . . . . . . . . . 17
4.3. Optional Prepayment . . . . . . . . . . . . 18
4.4. Interest on Principal Prepaid . . . . . . . 18
4.5. Prepayment Compensation . . . . . . . . . . 18
ARTICLE V SPECIAL PROVISIONS WITH RESPECT TO
CONTINUATION OF FIXED RATE LOANS
AND CONVERSION OF LOANS BETWEEN
EURODOLLARS AND DOMESTIC DOLLARS
5.1. Continuation of Eurodollar Loans . . . . . . 19
5.1.1. Continuation of CD Loans . . . . . 19
5.2. Conversion . . . . . . . . . . . . . . . . . 19
5.3. Restrictions on Borrower's Continuation and
Conversion Rights .. . . . . . . . . . . . 20
5.4. Notice of Continuations and Conversions . . 20
5.5. Interest Rate Unascertainable . . . . . . . 20
5.6. Bank Unable to Make Eurodollar Loan . . . . 21
5.7. Conversions Affecting Some Banks . . . . . . 21
ARTICLE VI MAKING AND PRORATION OF PAYMENTS;
OFFSET
6.1. Making of Payments . . . . . . . . . . . . . 22
6.2. Payment on Revolver Expiration Date . . . . 22
6.3. Allocation of Payments . . . . . . . . . . . 23
6.4. Proration of Other Recoveries . . . . . . . 24
6.5. Offset . . . . . . . . . . . . . . . . . . . 24
ARTICLE VII WARRANTIES
7.1. Organization, etc. . . . . . . . . . . . . . 25
7.2. Authorization; No Conflict . . . . . . . . . 25
7.3. Validity and Binding Nature . . . . . . . . 25
7.4. Financial Statements . . . . . . . . . . . . 25
7.5. Litigation . . . . . . . . . . . . . . . . . 26
7.6. Liens . .. . . . . . . . . . . . . . . . . . 26
7.7. ERISA . . . . . . . . . . . . . . . . . . . 26
7.8. Investment Company Act . . . . . . . . . . . 26
7.9. Public Utility Holding Company Act . . . . . 26
7.10. Regulations G, U, and X. . . . . . . . . . . 26
ARTICLE VIII COVENANTS
8.1. Reports, Certificates and Other
Information . . . . . . . . . . . . . . . 27
8.1.1. Audit Report ...... . . . . . . . . 27
8.1.2. Interim Reports . . . . . . . . . . 27
8.1.3. Certificates . . . . . . . . . . . 28
8.1.4. Reports to SEC and to
Shareholders .. . . . . . . . . . 28
8.1.5. Notice of Default or Litigation . . 28
8.1.6. ERISA . . . . . . . . . . . . . . . 28
8.1.7. Other Information . . . . . . . . . 28
8.2. Books, Records and Inspections . . . . . . . 28
8.3. Insurance . . . . . . . . . . . . . . . . . 29
8.4. Taxes and Liabilities . . . . . . . . . . . 29
8.5. Purchase or Redemption of the Company's
Securities; Dividend Restrictions . . . . 29
8.6. Liens . . . . . . . . . . . . . . . . . . . 29
8.7. Mergers and Consolidations . . . . . . . . . 31
8.8. Sale or Other Disposition of Assets . . . . 31
8.9. Interest Coverage and Consolidated
Debt to Consolidated Capitaliza-
tion Ratio . . . . . . . . . . . . . . . . 32
ARTICLE IX CONDITIONS OF LENDING
9.1. Initial Revolving Loans . . . . . . . . . . 32
9.1.1. Revolving Note . . . . . . . . . . 32
9.1.2. Resolutions . . . . . . . . . . . . 32
9.1.3. Consents, etc.. . . . . . . . . . . 32
9.1.4. Incumbency and Signatures . . . . . 32
9.1.5. Opinion of Counsel to Borrower . . 33
9.1.6. Other . . . . . . . . . . . . . . . 33
9.2. All Revolving Loans . . . . . . . . . . . . 33
9.2.1. No Default. . . . . . . . . . . . . 33
9.2.2. Confirmatory Certificate . . . . . 33
9.2.3. Litigation . . . . . . . . . . . . 33
9.3. Initial Loan to Any Designated
Subsidiary . . . . . . . . . . . . . . . 34
9.3.1. Basic Documents . . . . . . . . . . 34
9.3.2. Designation.. . . . . . . . . . . . 34
9.3.3. Opinion of Counsel. . . . . . . . . 34
9.4. Term Loans . . . . . . . . . . . . . . . . . 34
ARTICLE X GUARANTEE
10.1 Unconditional Guarantee . . . . . . . . . . 34
10.2 Guarantee Absolute . . . . . . . . . . . . . 35
10.3 Waivers . . . . . . . . . . . . . . . . . . 35
10.4 Remedies . . . . . . . . . . . . . . . . . . 36
10.5 Survival . . . . . . . . . . . . . . . . . . 36
ARTICLE XI EVENTS OF DEFAULT AND THEIR EFFECT
11.1. Events of Default . . . . . . . . . . . . . 37
11.1.1. Non-Payment of Notes, etc. . . . . 37
11.1.2. Non-Payment of Other Indebtedness . 37
11.1.3. Bankruptcy, Insolvency, etc. . . . 37
11.1.4. Non-Compliance with
This Agreement. . . . . . . . . . 38
11.1.5. Warranties. . . . . . . . . . . . . 38
11.1.6. ERISA . . . . . . . . . . . . . . 38
11.2. Effect of Event of Default . . . . . . . . . 38
11.3. Defaults by Designated Subsidiaries . . . . 39
11.3.1. Warranties. . . . . . . . . . . . . 39
11.3.2. Non-Payment of Other Indebtedness . 39
11.3.3. Bankruptcy, Insolvency, etc. . . . . 39
11.3.4. Non-Compliance with This Agreement . 40
11.4. Effect of Default by Designated Subsidiary . . . 40
ARTICLE XII CERTAIN DEFINITIONS
"Alternate Currency" . . . . . . . . . . . . . . . . 40
"Alternate Currency Loan" . . . . . . . . . . . . . 41
"Alternate Currency Payment Office" . . . . . . . . 41
"Alternate Rating Agency" . . . . . . . . . . . . . 41
"Assuming Bank" . . . . . . . . . . . . . . . . . . 41
"Assumption Agreement" . . . . . . . . . . . . . . . 41
"Bank" . . . . . . . . . . . . . . . . . . . . . . . 41
"Bank Indemnitees" . . . . . . . . . . . . . . . . . 41
"Borrower" . . . . . . . . . . . . . . . . . . . . . 41
"Borrowing Date" . . . . . . . . . . . . . . . . . . 41
"Business Day" . . . . . . . . . . . . . . . . . . . 41
"CD Interest Period" . . . . . . . . . . . . . . . . 41
"CD Loan" . . . . . . . . . . . . . . . . . . . . . 42
"CD Margin" . . . . . . . . . . . . . . . . . . . . 42
"CD Rate" . . . . . . . . . . . . . . . . . . . . . 42
"Commitment" . . . . . . . . . . . . . . . . . . . . 42
"Commitment Increase" . . . . . . . . . . . . . . . 43
"Consolidated Capitalization" . . . . . . . . . . . 43
"Consolidated Cash Interest Expense" . . . . . . . . 43
"Consolidated Debt" . . . . . . . . . . . . . . . . 43
"Consolidated EBDIT" . . . . . . . . . . . . . . . . 43
"Consolidated Net Income" . . . . . . . . . . . . . 43
"Consolidated Net Worth" . . . . . . . . . . . . . . 44
"Consolidated Subsidiary" . . . . . . . . . . . . . 44
"Continuation Date" . . . . . . . . . . . . . . . . 44
"Conversion Date" . . . . . . . . . . . . . . . . . 44
"Credit" . . . . . . . . . . . . . . . . . . . . . 44
"Credit Suspension Event" . . . . . . . . . . . . . 44
"Current Market Price" . . . . . . . . . . . . . . . 44
"Depositary Bank" . . . . . . . . . . . . . . . . . 45
"Designated Subsidiary" . . . . . . . . . . . . . . 45
"Designation Letter" . . . . . . . . . . . . . . . . 45
"Dollars" and "$" . . . . . . . . . . . . . . . . . 45
"Domestic Loan" . . . . . . . . . . . . . . . . . . 45
"Equivalent Domestic Loan" . . . . . . . . . . . . . 45
"Eurodollar Day" . . . . . . . . . . . . . . . . . . 45
"Eurodollar Interest Rate" . . . . . . . . . . . . . 45
"Eurodollar Loan" . . . . . . . . . . . . . . . . . 45
"Eurodollar Margin" . . . . . . . . . . . . . . . . 45
"Eurodollar Office" . . . . . . . . . . . . . . . . 45
"Eurodollar Period" . . . . . . . . . . . . . . . . 45
"Event of Default" . . . . . . . . . . . . . . . . . 46
"Federal Funds Rate" . . . . . . . . . . . . . . . . 46
"Fixed Rate Interest Date" . . . . . . . . . . . . . 46
"Fixed Rate Loan" . . . . . . . . . . . . . . . . . 46
"GAAP" . . . . . . . . . . . . . . . . . . . . . . 46
"Increase Date" . . . . . . . . . . . . . . . . . . 47
"Indemnified Liabilities" . . . . . . . . . . . . . 47
"Interest Date" . . . . . . . . . . . . . . . . . . 47
"Interest Period" . . . . . . . . . . . . . . . . . 47
"Liabilities" . . . . . . . . . . . . . . . . . . . 47
"Loan" . . . . . . . . . . . . . . . . . . . . . . 47
(i) "Alternate Currency Loan" . . . . . 47
(ii) "CD Loan" . . . . . . . . . . . . . 47
(iii) "Domestic Loan" . . . . . . . . . 47
(iv) "Eurodollar Loan" . . . . . . . . 47
(v) "Fixed Rate Loan" . . . . . . . . 47
(vi) "Market Rate Loan" . . . . . . . . 47
(vii) "Prime Rate Loan" . . . . . . . . . 47
(viii) "Revolving Loan" . . . . . . . . . 47
(ix) "Term Loan" . . . . . . . . . . . . 47
"Market Rate" . . . . . . . . . . . . . . . . . . . 48
"Market Rate Loan" . . . . . . . . . . . . . . . . . 48
"Market Rate Note" . . . . . . . . . . . . . . . . . 48
"Notes" . . . . . . . . . . . . . . . . . . . . . . 48
"Obligations". . . . . . . . . . . . . . . . . . . . 48
"Percentage" . . . . . . . . . . . . . . . . . . . . 48
"Person" . . . . . . . . . . . . . . . . . . . . . . 48
"Prime Rate" . . . . . . . . . . . . . . . . . . . . 48
"Prime Rate Interest Date" . . . . . . . . . . . . . 48
"Prime Rate Loan" . . . . . . . . . . . . . . . . . 48
"Public Debt Rating" . . . . . . . . . . . . . . . . 48
"Reference Banks" . . . . . . . . . . . . . . . . . 49
"Regulation D" . . . . . . . . . . . . . . . . . . . 49
"Revolver Expiration Date" . . . . . . . . . . . . . 49
"Revolving Loan" . . . . . . . . . . . . . . . . . . 49
"Revolving Note" . . . . . . . . . . . . . . . . . . 49
"Significant Subsidiary" . . . . . . . . . . . . . . 49
"Subsidiary" . . . . . . . . . . . . . . . . . . . . 49
"Term Loan" . . . . . . . . . . . . . . . . . . . . 49
"Term Note" . . . . . . . . . . . . . . . . . . . . 49
ARTICLE XIII GENERAL
13.1. Waiver; Amendments . . . . . . . . . . . . . 49
13.2. Confirmations . . . . . . . . . . . . . . . 50
13.3. Notices . . . . . . . . . . . . . . . . . . 50
13.4. Accounting Terms and Determinations . . . . . . . 51
13.5. Participations; Transfers of Notes . . . . . 51
13.6. Regulation U . . . . . . . . . . . . . . . . 53
13.7. Confidentiality of Information . . . . . . . 53
13.8. Limitation on Interest . . . . . . . . . . . 54
13.9. Costs, Expenses and Taxes . . . . . . . . . 54
13.10. Designated Subsidiaries . . . . . . . . . . 54
13.11. Captions . . . . . . . . . . . . . . . . . . . . 55
13.12. Governing Law; Submission to
Jurisdiction. . . . . . . . . . . . . . . . 55
13.13. Counterparts . . . . . . . . . . . . . . . . 55
13.14. Effectiveness . . . . . . . . . . . . . . . 55
13.15. Successors and Assigns . . . . . . . . . . . 55
13.16. Duties of Depositary Bank . . . . . . . . . 56
13.17. Severability . . . . . . . . . . . . . . . . 56
13.18. Representation of the Banks . . . . . . . . 57
13.19. Survival . . . . . . . . . . . . . . . . . . 57
13.20. Waiver of Trial by Jury . . . . . . . . . . 57
EXHIBITS
Exhibit A -- Form of Revolving Note
Exhibit B -- Form of Term Note
Exhibit C -- Form of Market Rate Note
Exhibit D -- Form of Opinion of Counsel to the Company
Exhibit E -- Form of Designation Letter
Exhibit F -- Form of Opinion of Counsel for Each Borrower
FOUR YEAR CREDIT AGREEMENT
THIS FOUR YEAR CREDIT AGREEMENT, dated as of
January 12, 1994 (the "Agreement"), among GENERAL SIGNAL
CORPORATION, a New York corporation (the "Company"), each other
Borrower hereunder and the undersigned commercial banking
institutions (herein called collectively "Banks").
W I T N E S S E T H:
WHEREAS, the Company desires by this Agreement (such
and other capitalized terms being used herein with the meanings
respectively ascribed to them in Article XII) to obtain
commitments for revolving credit loans to be made in an aggregate
outstanding principal amount not to exceed $200,000,000 on or
prior to the Revolver Expiration Date and to provide for the
making of Market Rate Loans by the several Banks; and
WHEREAS, Banks are willing, severally and not jointly,
upon the terms and conditions hereinafter set forth, to extend
such revolving loan commitments and to make loans pursuant
thereto and to make non-committed Market Rate Loans for general
working capital and other corporate purposes (including, without
limitation, acquisitions and the purchase of securities and
assets, including repurchases of the Company's securities);
NOW, THEREFORE, in consideration of the agreements
herein contained, the parties hereto hereby agree as follows:
ARTICLE I
COMMITMENTS OF BANKS; BORROWING PROCEDURES AND CONDITIONS
SECTION 1.1. Commitments. Subject to the terms and
conditions of this Agreement, each Bank severally agrees to make
Revolving Loans hereunder to any Borrower up to the maximum
amounts specified in Section 1.1.4 as follows:
SECTION 1.1.1. Revolving Loan Commitments. Loans on
a revolving basis (i.e., subject to the terms and conditions of
this Agreement, Revolving Loans may be borrowed, prepaid, repaid
and re-borrowed) from time to time on or before the Revolver
Expiration Date to any Borrower equal to such Bank's Percentage
of the aggregate amount of such Revolving Loan (each herein
called a "Revolving Loan") except as each Bank's obligation to
make Revolving Loans may be created or modified as provided in
this Section 1.1 and Section 13.5.
SECTION 1.1.2. Term Loan Commitments. A loan (herein
called a "Term Loan") on the Revolver Expiration Date in such
Bank's Percentage of such aggregate amount as Borrower may
request from all Banks, such aggregate amount not to exceed the
amount of the Credit.
SECTION 1.1.3. Domestic and Eurodollar Loan
Commitments. Subject to the terms and conditions of this
Agreement, each Revolving Loan and each Term Loan shall be either
a Domestic Loan or a Eurodollar Loan, as Borrower shall request
in the relevant notice of borrowing pursuant to Section 1.2 or
5.4, it being understood that both Domestic Loans and Eurodollar
Loans may be outstanding at the same time. As to any Eurodollar
Loan or Domestic Loan, each Bank may, if it so elects (which
election shall be made by such Bank in a manner consistent with
its undertaking contained in Section 5.7 and otherwise in good
faith with a view to not increasing unnecessarily the obligations
of any Borrower hereunder), fulfill its aforesaid commitment by
causing a foreign branch or affiliate of such Bank (such foreign
branch or affiliate or any U.S. branch or affiliate from which a
Bank funds a Eurodollar Loan herein called such Bank's
"Eurodollar Office") to make such Loan, provided that in such
event for the purposes of this Agreement such Eurodollar Loan
shall be deemed to have been made by such Bank, and the
obligation of Borrower to repay such Eurodollar Loan shall
nevertheless be to such Bank and shall be deemed held by it, to
the extent of such Eurodollar Loan, for the account of such
branch or affiliate.
SECTION 1.1.4. Commitment Limits. The aggregate
principal amount of Revolving Loans and Term Loans which any Bank
shall be committed to lend to Borrower shall not at any one time
exceed such Bank's Commitment; and the aggregate amount of the
Credit shall not at any one time exceed $200,000,000 (or such
greater or lesser amount as may be determined pursuant to this
Section 1.1). Except as may be otherwise required by Section
5.6, no Bank's obligation to make any Revolving Loan or Term Loan
shall, the ratability provisions of Section 1.1.3 to the contrary
notwithstanding, be affected by any other Bank's failure or
inability to make any Revolving Loan or Term Loan.
SECTION 1.1.5. Mandatory Reduction of the Commitments.
On the Revolver Expiration Date the Commitment of each Bank shall
be reduced to zero; provided that on the Revolver Expiration Date
any Borrower may borrow a Term Loan pursuant to Section 1.2. The
aggregate amount of the Commitments of the Banks once reduced
pursuant to this Section 1.1.5 may not be reinstated.
SECTION 1.1.6. Optional Pro Rata Reduction. The
Company shall have the right, at any time or from time to time,
upon not less than three Business Days' prior notice to the
Depositary Bank (and the Depositary Bank shall promptly notify
each Bank of each termination or reduction) to terminate or
reduce, in whole or in part, on a pro rata basis the unused
portions of the respective Commitments of the Banks, provided
that each partial reduction shall be in an aggregate principal
amount of $5,000,000 or a multiple thereof. The aggregate amount
of the Commitments of the Banks once reduced pursuant to this
Section 1.1.6 may not be reinstated, except pursuant to Section
1.1.8.
SECTION 1.1.7. Optional Non-Pro Rata Reduction. The
Company shall have the right, upon not less than five Business
Days' prior notice to a Bank (with a copy to the Depositary
Bank), to terminate in whole such Bank's Commitment; provided,
that at the time such notice of termination is given (A) no
Credit Suspension Event has occurred and is continuing and (B)
either (i) the Public Debt Rating of the Company is A-/A3 or
higher or (ii) concurrently with the termination of such Bank's
Commitment a Commitment Increase becomes effective pursuant to
Section 1.1.8 in an amount not less than the Commitments
concurrently being terminated pursuant to this Section 1.1.7.
Such termination shall be effective, (A) with respect to such
Bank's unused Commitment, on the date set forth in such notice,
provided, however, that such date shall be no earlier than ten
Business Days after receipt of such notice and (B) with respect
to each Loan outstanding to such Bank, on the last day of the
then current Interest Period relating to such Loan. Upon
termination of a Bank's Commitment under this Section 1.1.7, the
Company will pay or cause to be paid all principal of, and
interest accrued to the date of such payment on Loans owing to
such Bank and pay any facility fees or other fees payable to such
Bank pursuant to Section 3.2, and all other amounts payable to
such Bank hereunder; and upon such payments, the obligations of
such Bank hereunder shall, by the provisions hereof, be released
and discharged. The aggregate amount of the Commitments of the
Banks once reduced pursuant to this Section 1.1.7, may not be
reinstated, except pursuant to Section 1.1.8.
SECTION 1.1.8. Increase in Commitments. The Company
may at any time, by notice to the Depositary Bank, propose that
the aggregate of the Commitments be increased in excess of the
aggregate of the Commitments then in effect (a "Commitment
Increase"), effective as of a date prior to the Revolver
Expiration Date (the "Increase Date") as to which agreement is to
be reached by an earlier date specified in such notice (the
"Commitment Date"); provided, however, that (A) the minimum
proposed Commitment Increase per notice shall be in an amount no
less than $5,000,000, (B) no Event of Default has occurred and is
continuing and (C) the warranties of the Company in Article VII
shall be true and correct in all material respects with the same
effect as if made on such Increase Date. The Depositary Bank
shall notify the Banks thereof promptly upon its receipt of any
such notice. If agreement is reached on or prior to the
Commitment Date with one or more Banks and Assuming Banks, if
any, as to a Commitment Increase (which may be less than
specified in the applicable notice from the Company), such
agreement to be evidenced by a notice in reasonable detail from
the Company to the Depositary Bank on or prior to the Commitment
Date, the Assuming Banks, if any, shall become Banks hereunder as
of the Increase Date and the Commitments of such Banks and such
Assuming Banks shall become or be, as the case may be, as of the
Increase Date the amounts specified in such notice (and the
Depositary Bank shall give notice thereof to the Banks (including
such Assuming Banks)); provided, however, that:
(a) the Depositary Bank shall have received (with
copies for each Bank, including each Assuming Bank), on or
prior to the Increase Date, an opinion of counsel for the
Company in substantially the form of Exhibit D hereto and an
opinion of counsel for each other Borrower substantially in
the form of Exhibit F hereto, dated such Increase Date,
together with a copy, certified on the Increase Date by the
Secretary or an Assistant Secretary of the pertinent
Borrower, of the resolutions adopted by the Board of
Directors of the Company and each such other Borrower
authorizing such Commitment Increase;
(b) each such Assuming Bank shall have delivered, on
or prior to the Increase Date, to the Depositary Bank an
appropriate Assumption Agreement; and
(c) each Bank which proposes to increase its
Commitment in connection with such Commitment Increase shall
have delivered, on or prior to the Increase Date,
confirmation in writing satisfactory to the Depositary Bank
as to its increased Commitment.
In the event that the Depositary Bank shall not have received
notice from the Company as to such agreement on or prior to the
Commitment Date or the Company shall, by notice to the Depositary
Bank prior to the Increase Date, withdraw such proposal or any of
the actions provided for above in clauses (a) through (c) of this
Section 1.1.8. shall not have occurred by the Increase Date, such
proposal by the Company shall be deemed not to have been made.
In such event, the actions theretofore taken under clauses (a)
through (c) of this Section 1.1.8., shall be deemed to be of no
effect and all the rights and obligations of the parties shall
continue as if no such proposal had been made.
Following any Commitment Increase, the Borrower shall
be deemed to repay and reborrow each Revolving Loan having an
Interest Period commencing prior to such Increase Date on the
date of the continuation or conversion of any Revolving Loan that
is a Fixed Rate Loan or the next Interest Date for any Revolving
Loan that is a Prime Rate Loan.
SECTION 1.2. Borrowing Procedures. Borrower shall
provide The Chase Manhattan Bank, N.A. (herein called "Depositary
Bank"), with notice (of which Depositary Bank shall give prompt
notice to each other Bank), by 10:00 a.m. New York City time on
the day of a proposed borrowing of Prime Rate Loans, at least two
Business Days prior to each proposed borrowing of CD Loans or at
least three Eurodollar Days prior to each proposed borrowing of
Eurodollar Loans, as the case may be, of the date and amount of
such borrowing (except that if the Term Loan borrowing shall
comprise both Domestic and Eurodollar Loans, there shall be a
single notice at least three Eurodollar Days prior to such
proposed borrowing), the interest rate applicable thereto and, in
the case of a Eurodollar Loan or CD Loan, the duration of the
initial Interest Period. Each Bank shall provide Depositary Bank
at its address set forth below its signature hereto, by not later
than 12:30 p.m., New York City time, on the date of a proposed
borrowing, with immediately available funds covering such Bank's
Percentage of the borrowing (or, in the case of the Term Loan
borrowing, of any excess of the aggregate Term Loan borrowing
over the aggregate principal amount of the Revolving Loans then
outstanding plus accrued interest unpaid at the Revolver
Expiration Date), and Depositary Bank shall pay over such
immediately available funds to Borrower upon each Bank's
(including, without limitation, Depositary Bank's) receipt of the
documents required under Article IX with respect to such
borrowing. Each borrowing hereunder shall be in an aggregate
amount that is an integral multiple of $1,000,000 and at least
$5,000,000.
SECTION 1.3. Market Rate Loans. (a) Notwithstanding
any provisions of this Agreement to the contrary, any Bank may,
from time to time, make Market Rate Loans denominated in Dollars
or in any Alternate Currency to any Borrower bearing interest at
such rate (hereinafter called such Bank's "Market Rate") of
interest as may be agreed upon by the Borrower and such Bank.
Each Bank may in its sole discretion negotiate with any Borrower
concerning the offering of Loans at a Market Rate (hereinafter
called "Market Rate Loans"); provided, that nothing contained in
this Agreement shall be deemed to require any Bank to offer
Market Rate Loans to any Borrower. In the event that any
Borrower and any Bank agree to the making of a Market Rate Loan,
such Market Rate Loan shall be made severally by such Bank
directly to such Borrower without participation in such Market
Rate Loan by any other Bank. Such Market Rate Loan may be on
such further terms and conditions, including the right of the
Borrower to prepay such Market Rate Loan, as may be agreed upon
by the Borrower and such Bank.
(b) Notwithstanding anything to the contrary contained
in this Agreement, all payments or prepayments made in respect of
Market Rate Loans made by a Bank pursuant to Section 1.3(a) shall
be made directly to such Bank, and such Bank shall not be subject
to the provisions of Section 6.3 or 6.4 in respect of any such
payments so received.
(c) Upon the making of, or any repayment of principal
of, any Market Rate Loan, Borrower shall give the Depositary Bank
prompt written, facsimile or telephonic notice of such Market
Rate Loan or repayment, which notice shall state the Borrower,
the principal amount of such Market Rate Loan or the amount of
such repayment, the maturity date of such Market Rate Loan (if
applicable) and, if such Market Rate Loan is an Alternate
Currency Loan, the Alternate Currency, the Dollar equivalent of
the principal amount thereof and the Alternate Currency Payment
Office.
(d) Market Rate Loans shall not be subject to the
limitations on the aggregate amount of the Credit as provided in
Section 1.1.4 and shall not reduce the amount of any Bank's
unused Commitment.
(e) The Company shall designate for each Alternate
Currency in which any Borrower proposes to borrow an Alternate
Currency Loan an office of a bank at which the proceeds of
Alternate Currency Loans denominated in such Alternate Currency
will be made available to Borrower and payments in such Alternate
Currency will be made (an "Alternate Currency Payment Office") by
written notice to Depositary Bank. Any Borrower and any Bank
making a Market Rate Loan that is an Alternate Currency Loan may
agree upon a different Alternate Currency Payment Office with
respect to such Market Rate Loan. The Company or Borrower shall
provide the Depositary Bank with written notice of any such
designation.
SECTION 1.4. Conditions to Each Loan. Notwithstanding
any other provision of this Agreement, no Revolving Loan or Term
Loan shall be required to be made hereunder if the conditions
precedent to the making of such Loan specified in Article IX have
not been satisfied.
ARTICLE II
NOTES EVIDENCING LOANS
SECTION 2.1. Revolving Notes. The Revolving Loans of
each Bank shall be evidenced by a promissory note (herein called
a "Revolving Note") substantially in the form set forth in
Exhibit A, with appropriate insertions, payable to the order of
such Bank on the Revolver Expiration Date in the principal amount
equal to the amount of such Bank's Commitment or in the aggregate
unpaid principal amount of all of its Revolving Loans, whichever
is less. The date and amount of each Revolving Loan made by such
Bank and of each repayment of principal thereof received by such
Bank, and, in the case of each Eurodollar Loan or CD Loan, the
dates on which each Interest Period as to such Loan shall begin
and end, shall be recorded by such Bank on the schedule attached
to the Revolving Note issued to such Bank, and the aggregate
unpaid principal amount shown on such schedule shall be
conclusive evidence absent demonstrable error of the principal
amount owing and unpaid on such Revolving Note. The failure to
record any such amount on such schedule shall not, however, limit
or otherwise affect the obligations of Borrower hereunder or
under any Note to repay the principal amount of the Loans
together with all interest accruing thereon or any other amount
owing hereunder. Each Revolving Loan shall be repaid on the
Revolver Expiration Date, subject to the right of Borrower to
prepay such Revolving Loan and, prior to the Revolver Expiration
Date, to reborrow hereunder, in accordance with the provisions of
this Agreement.
SECTION 2.2. Term Notes. The Term Loan of each Bank
shall be evidenced by a promissory note (herein called a "Term
Note") substantially in the form set forth in Exhibit B, with
appropriate insertions, dated the Revolver Expiration Date,
payable to the order of such Bank in the original principal
amount of such Term Loan on the date which is one year after the
Revolver Expiration Date.
SECTION 2.3. Market Rate Notes. A Market Rate Loan
made by any Bank to Borrower shall be evidenced by a promissory
note (herein called a "Market Rate Note") substantially in the
form set forth in Exhibit C, with appropriate insertions, and
containing such other terms as the Borrower and such Bank may
agree.
ARTICLE III
INTEREST AND FEES
SECTION 3.1. Interest. Subject to the provisions of
Section 4.4, (i) interest prior to maturity (whether by
acceleration or otherwise) on each Prime Rate Loan shall be
payable in arrears on the last day of each March, June, September
and December and on the Revolver Expiration Date (herein, subject
to the requirements of Section 3.4, and including the final
maturities, by acceleration or otherwise, of all of the Revolving
Loans, called a "Prime Rate Interest Date"), and (ii) interest
prior to maturity on each Eurodollar Loan and CD Loan shall be
payable on the last day of the Interest Period for such Loan
(herein called a "Fixed Rate Interest Date"). Interest from and
after maturity (whether by acceleration or otherwise) on all
Loans shall be payable on demand. Interest on each Loan shall
accrue from and including the Borrowing Date thereof but shall
not accrue on any principal amount of such Loan for the day on
which such principal amount is paid. For purposes of the
foregoing computations, a conversion of Eurodollar Loans to
Domestic Loans or of Domestic Loans to Eurodollar Loans, or a
conversion of CD Loans to Prime Rate Loans or of Prime Rate Loans
to CD Loans, or a continuation of Eurodollar Loans or CD Loans,
pursuant to Article V shall be deemed to comprise a payment of
principal together with the making of a concurrent Loan.
SECTION 3.1.1. Interest on Domestic Loans. Interest
on the unpaid portion of the principal amount of Domestic Loans
shall accrue until paid with respect to each Bank at the
following rates per annum:
SECTION 3.1.1.1. Revolving Loans and Term Loans.
(i) Prior to maturity, at a rate equal to the Prime Rate, from
time to time in effect, or the CD Rate, as the Borrower has
specified in its notice of borrowing pursuant to Section 1.2
hereof; and (ii) after maturity, whether by acceleration or
otherwise, until paid, at a rate equal to the sum of the Prime
Rate, in effect from time to time, plus 1%.
SECTION 3.1.1.2. Changes in Prime Rate. The
applicable interest rate on Prime Rate Loans shall change
simultaneously with the effectiveness of each change in the Prime
Rate.
SECTION 3.1.2. Interest on Eurodollar Loans. Interest
on the unpaid principal amount of each Eurodollar Loan shall
accrue at a rate per annum (herein called the "Eurodollar
Interest Rate") calculated for each Eurodollar Period as follows:
SECTION 3.1.2.1. Revolving Loans and Term Loans. The
Eurodollar Interest Rate for each Eurodollar Period shall be a
rate per annum which is equal to the sum of the Eurodollar Margin
in effect on the first day of the applicable Eurodollar Period
plus the rate obtained by dividing (i) the arithmetic average
(rounded to the nearest whole multiple of 1/16 of 1%) of the
rates per annum calculated by Depositary Bank on the basis of
notification from the Reference Banks at which Dollar deposits
are offered to each Reference Bank by prime banks in the London
Interbank Eurodollar market in immediately available funds at
11:00 a.m., London time, two Eurodollar Days before the beginning
of such Eurodollar Period for a period comparable to such
Eurodollar Period and in a principal amount comparable to the
Eurodollar Loan of such Reference Bank for such Eurodollar Period
divided (and rounded to the nearest whole multiple of 1/16 of 1%)
by (ii) a percentage equal to 100% minus the then stated maximum
rate of all reserve requirements (including without limitation
any marginal, emergency, supplemental, special or other reserves)
applicable to any member bank of the Federal Reserve System in
respect of Eurocurrency liabilities as defined in Regulation D of
the Board of Governors of the Federal Reserve System (herein
called "Regulation D") or any successor category of liabilities
under Regulation D.
SECTION 3.1.2.2. After Maturity. In the event of
default by any Borrower in the payment when due (whether by
acceleration or otherwise) of part or all of the principal amount
of any Eurodollar Loan, such Borrower shall pay interest on such
unpaid amount from the date such amount shall have become due to
the date of actual payment, accruing on a daily basis, at a rate
per annum (i) in the event such default shall occur prior to the
scheduled expiration of the Eurodollar Period for such Loan, then
during the remaining portion of such Eurodollar Period, equal to
1% plus the Eurodollar Interest Rate for such Eurodollar Period
of such Loan during which such default occurred and (ii) after
the expiration of the Eurodollar Period for such Loan (or
expiring concurrently with such default) equal to the Prime Rate,
from time to time in effect, plus 1%.
SECTION 3.1.3. Notice of CD Rate or Eurodollar
Interest Rate. The CD Rate for each CD Interest Period and the
Eurodollar Interest Rate for each Eurodollar Period shall be
determined by Depositary Bank as provided herein and notice
thereof (including a calculation in reasonable detail) shall be
given by Depositary Bank promptly to each Bank and to the
Company.
SECTION 3.1.4. Rate Determination Conclusive. Each
calculation of the Eurodollar Interest Rate or the CD Rate,
furnished to the Banks and to the Company by Depositary Bank
pursuant to Section 3.1.3 shall, unless objected to by any Bank
or the Company within 30 days thereafter, be conclusive and
binding upon the parties hereto, in the absence of demonstrable
error. If any one or more of the Reference Banks is unable or
for any reason fails to notify Depositary Bank of the applicable
interest rate on the day specified in Section 3.1.2.1, in the
case of a Eurodollar Loan, or in the definition of "CD Rate", in
the case of a CD Loan, by 9:00 p.m., London time in the case of
a Eurodollar Loan and 4:00 p.m., New York City time in the case
of a CD Loan, the applicable Eurodollar Interest Rate or CD Rate,
as the case may be, shall be determined on the basis of the rate
or rates of which Depositary Bank is given notice by the
remaining Reference Bank or Banks by such time. If none of the
Reference Banks is able to notify Depositary Bank of such a rate,
the provisions of clauses (a), (b) and (c) of Section 5.5 shall
apply.
SECTION 3.1.5. Increased Cost of Fixed Rate Loans.
Borrower agrees to pay directly to each Bank additional amounts
as will compensate such Bank for (i.e., make such Bank whole
against, but only to the extent and for the duration of) (i) any
increase in the cost to such Bank of making or maintaining any
Eurodollar Loan or CD Loan hereunder, or of its obligation to
make or maintain any Eurodollar Loans or CD Loans hereunder, or
(ii) any reduction in the amount of any sum receivable by such
Bank hereunder in respect of any Eurodollar Loan or CD Loan, from
time to time, by reason of:
(a) any reserve, special deposit, or similar
requirements against assets of, deposits with or for the
account of or credit extended by, such Bank which are
imposed on, or deemed applicable by, such Bank, under or
pursuant to any law, treaty, rule, regulation (including,
without limitation, Regulation D) or requirement in effect
on or after the date hereof, any change therein, or any
interpretation thereof by any governmental authority charged
with administration thereof or by any central bank or other
fiscal, monetary or other authority having jurisdiction over
the CD Loans, the Eurodollar Loans, such Bank, or a
Eurodollar Office which is a foreign branch or affiliate of
such Bank, or any requirement imposed by any central bank or
such other authority, whether or not having the force of
law; or
(b) any change in (including the introduction of any
new) applicable law, treaty, rule, regulation or requirement
or in the interpretation thereof by any official authority,
or the imposition of any requirement of any central bank,
whether or not having the force of law, which shall subject
such Bank or Borrower to any tax (other than taxes on net
income or net worth or franchise taxes), levy, impost,
charge, fee, duty, deduction or withholding of any kind
whatsoever or change the taxation of a Eurodollar Office
which is a foreign branch or affiliate of such Bank with
respect to any Eurodollar Loan of such Bank hereunder and
the interest thereon (other than any change which affects,
and to the extent that it affects, the taxation of net
income);
provided, however, that no Bank shall seek compensation for any
such increase in cost, or for any such reduction in the amount of
any sum receivable, for any period when any Eurodollar Loan or CD
Loan shall be outstanding if such Bank shall, on or prior to the
date of making such Eurodollar Loan or CD Loan, have notified the
Borrower that it will not seek compensation therefor and will not
give notice thereof in accordance with the following paragraph of
this Section; provided, further, that the Borrower shall not be
required to pay any additional amount on account of any taxes
imposed by the United States pursuant to this Section 3.1.5. to
any Bank which (i) is not entitled, on the date hereof (or, in
the case of an assignee of a Bank, on the date on which the
assignment to it became effective), to submit Form 1001 or Form
4224 (or any successor forms) so as to meet its obligations to
submit such a form pursuant to Section 13.18 or Section 13.5, or
(ii) shall have failed to submit any form or other certification
which it was required to file pursuant to Section 13.18 or
Section 13.5 and entitled to file under applicable law, or (iii)
shall have filed any such form which is incorrect or incomplete
in any material respect.
In any such event, each Bank so affected shall promptly notify
Borrower and Depositary Bank (which shall give prompt notice
thereof to each other Bank) thereof by telephone, confirmed in
writing, stating the reasons therefor and the additional amounts
required fully to compensate such Bank for such increased cost or
reduced amount. Such additional amounts shall be payable on the
Fixed Rate Interest Date of each Eurodollar Loan and CD Loan so
affected, and upon demand if such notice is not given to Borrower
prior to such Fixed Rate Interest Date or if there are no
Eurodollar Loans or CD Loans outstanding when such notice is
given, provided that such compensation will cover a period
beginning not more than 90 days prior to such notice. A
certificate as to any such increased cost or reduced amount
(including calculations, in reasonable detail, showing how such
Bank computed such cost or reduction) shall be submitted by each
affected Bank to Borrower and Depositary Bank (which shall
promptly furnish copies thereof to each other Bank) and shall, in
the absence of demonstrable error, be conclusive and binding.
SECTION 3.1.6. Interest on Market Rate Loans. The
applicable interest rate, and the time of payment therefor, for
each Market Rate Loan shall be as agreed upon by Borrower and the
Bank making such Market Rate Loan.
SECTION 3.1.7. Additional Costs. Without limiting the
effect of the foregoing provisions of Section 3.1.5 (but without
duplication), the Borrower shall pay directly to each Bank from
time to time on demand such amounts as such Bank may determine to
be necessary to compensate such Bank for any costs which such
Bank determines are attributable to any Revolving Loan
outstanding hereunder or to its obligation to make any Revolving
Loans hereunder and to other loans or commitments of this type in
respect of any amount of capital maintained by such Bank or any
of its affiliates pursuant to any law or regulation of any
jurisdiction, or any change therein, or any interpretation,
guidelines, directive or request (whether or not having the force
of law) of any court or governmental or monetary authority,
whether in effect on the date of this Agreement or thereafter.
Without limiting the foregoing, such compensation shall include
an amount equal to any reduction in return on assets or return on
equity to a level below that which such Bank could have achieved
but for such law, regulation, change, interpretation, directive
or request; provided, however, that no Bank shall seek
compensation for any such increase in cost, or for any such
reduction in the amount of any sum receivable, in respect of any
Revolving Loan outstanding hereunder for any period when any
Revolving Loan shall be outstanding if such Bank shall, on or
prior to the date of making such Revolving Loan, have notified
the Borrower that it will not seek compensation therefor and will
not give notice thereof in accordance with the following
paragraph of this Section.
In any such event, each Bank so affected shall promptly notify
the Company and Depositary Bank (which shall give prompt notice
thereof to each other Bank) thereof by telephone, confirmed in
writing, stating the reasons therefor and the additional amounts
required fully to compensate such Bank for such increased cost or
reduced amount. Such additional amounts shall be payable on the
next Interest Date, or upon demand if there are no Loans
outstanding when such notice is given, provided that such
compensation will cover a period beginning not more than 90 days
prior to such notice. A certificate as to any such increased
cost or reduced amount (including calculations, in reasonable
detail, showing how such Bank computed such cost or reduction)
shall be submitted by each affected Bank to Borrower and
Depositary Bank (which shall promptly furnish copies thereof to
each other Bank) and shall, in the absence of demonstrable error,
be conclusive and binding.
SECTION 3.1.8. Applicable Margin. The "Eurodollar
Margin" or "CD Margin" means, as of any date, with respect to any
Eurodollar Loan or CD Loan, respectively, the applicable
percentage set opposite the Public Debt Rating in effect on such
date:
Public Debt Rating Eurodollar Margin CD Margin
Level 1:
AA-/Aa3
or higher 0.1875% 0.3125%
Level 2:
A-/A3 or higher, but
less than Level 1 0.25% 0.375%
Level 3:
BBB-/Baa3 or higher,
but less than Level 2 0.40% 0.525%
Level 4:
Less than BBB-/Baa3 0.75% 0.875%
Any adjustment to the Eurodollar Margin or CD Margin
pursuant to this Section 3.1.8 shall become effective for
Interest Periods commencing after a public announcement of a
change in debt rating which requires an adjustment to be made
hereunder.
SECTION 3.2. Facility Fee. Borrower agrees to pay the
Banks a facility fee for the period from and including
January 12, 1994 to the Revolver Expiration Date equal to the
percentage per annum set forth for the applicable Public Debt
Rating in the table below on the daily average amount of the
Credit; provided that no facility fee shall be payable to any
Bank on that portion of the Credit then borrowed as Prime Rate
Loans as a result of a conversion of any Fixed Rate Loan pursuant
to Section 4.2, 5.5, 5.6 or 5.7.
Public Debt Rating Facility Fee Percentage
Level 1:
AA-/Aa3 or higher 0.1250%
Level 2:
A-/A3 or higher, 0.15%
but less than Level 1
Level 3:
BBB-/Baa3 or higher, 0.25%
but less than Level 2
Level 4:
Less than BBB-/Baa3 0.40%
If Term Loans are borrowed on the Revolver Expiration
Date, Borrower agrees to pay the Banks a Facility Fee from and
including the Revolver Expiration Date to the date all Term Loans
are repaid in full equal to 0.125% on the average daily principal
balance of the Term Loans; provided that no Facility Fee shall be
payable to any Bank on that portion of the Term Loans that are
Prime Rate Loans as a result of a conversion of any Fixed Rate
Loan pursuant to Section 4.2, 5.5, 5.6 or 5.7.
Such facility fee shall be payable on the last day of
March, June, September and December for the period then ending
for which such facility fee shall not have been theretofore paid
(the first such payment to be made on March 31, 1994) and on the
earlier of the Revolver Expiration Date or the date of
termination of the Credit for any period then ending for which
such facility fee shall not have been theretofore paid.
SECTION 3.3. Basis of Computation. Interest on Prime
Rate Loans and the facility fee shall be computed for the actual
number of days elapsed on the basis of a year consisting of 365
or, if applicable, 366 days. Interest on Fixed Rate Loans shall
be computed for the actual number of days elapsed on the basis of
a year consisting of 360 days. Interest on each Market Rate Loan
shall be computed on the same basis as Fixed Rate Loans unless
otherwise agreed upon by Borrower and the Bank making such Market
Rate Loan.
SECTION 3.4. Extension of Due Date. If any payment of
principal of, or interest on, any Domestic Loan or any payment of
a facility fee falls due on a day which is not a Business Day,
then such due date shall be extended to the next following
Business Day. If any payment of principal of, or interest on,
any Eurodollar Loan falls due on a day which is not a Eurodollar
Day, then such due date shall be extended to the next Eurodollar
Day, unless such Eurodollar Day falls in another calendar month,
in which case the date for payment thereof shall be the preceding
Eurodollar Day. If the date for any payment of principal is
extended pursuant to this Section 3.4, additional interest shall
accrue and be payable for the period of such extension.
SECTION 3.5. Interest Rate Determination. Each
Reference Bank agrees to furnish to the Depositary Bank timely
information for the purpose of determining each Prime Rate, CD
Rate or Eurodollar Rate, as applicable. If any one or more of
the Reference Banks shall not furnish such timely information to
the Depositary Bank for determination of any such interest rate,
the Depositary Bank shall determine such interest rate on the
basis of timely information furnished by the remaining Reference
Banks. The Depositary Bank shall give prompt notice to the
Borrower and, if different, the Company and the Banks of the
applicable interest rate determined by the Depositary Bank and of
the applicable rate, if any, furnished by each Reference Bank for
determining the applicable interest rate under Section 3.1.
SECTION 3.6. Currency Equivalents. For purposes of
the provisions of Articles I, II, III, IV and V, (i) the
equivalent in Dollars of any Alternate Currency shall be
determined by using the quoted spot rate at which the principal
office in New York City of the pertinent Bank or the principal
office in New York City of any affiliate of such Bank offers to
exchange Dollars for such Alternate Currency in New York City at
11:00 a.m. (New York City time), two Business Days prior to the
date on which such equivalent is to be determined, (ii) the
equivalent in any Alternate Currency of any other Alternate
Currency shall be determined by using the quoted spot rate at
which such Bank's principal office in New York City or the
principal office in New York City of any affiliate of such Bank
offers to exchange such Alternate Currency for the equivalent in
Dollars of such other Alternate Currency in New York City at
11:00 a.m. (New York City time), two Business Days prior to the
date on which such equivalent is to be determined, and (iii) the
equivalent in any Alternate Currency of Dollars shall be
determined by using the quoted spot rate at which such Bank's
principal office in New York City or the principal office in New
York City of any affiliate of such Bank offers to exchange such
Alternate Currency for Dollars in New York City at 11:00 a.m.
(New York City time), two Business Days prior to the date on
which such equivalent is to be determined.
ARTICLE IV
PREPAYMENTS
SECTION 4.1. Prepayment upon Reduction or Termination
of the Credit. On the effective date of any reduction of the
Commitments pursuant to Section 1.1.6 Borrower shall prepay the
amount, if any, by which the aggregate unpaid principal amount of
all Revolving Notes exceeds the then reduced amount of the
Credit; provided, that on the later of the termination of the
Commitments in their entirety or the maturity of the Term Loan,
if made, each Borrower shall pay in full all of its obligations
hereunder and under the Notes accrued or payable through such
date (all such obligations being herein collectively called the
"Liabilities").
SECTION 4.2. Change in Law Rendering Fixed Rate Loans
Unlawful. In the event that any change in (including the
introduction of any new) applicable laws or regulations, or in
the interpretation thereof by any governmental or other
regulatory authority charged with the administration thereof,
shall make it unlawful for any Bank to make or continue any
Eurodollar Loan or CD Loan to be made or continued by it
hereunder, the obligation of such Bank pursuant to which such
Eurodollar Loan or CD Loan would otherwise be made shall, upon
the happening of such event, forthwith terminate and such Bank
shall, by telephonic notice confirmed in writing to Borrower
(with a copy to Depositary Bank, which shall give prompt notice
thereof to each other Bank), declare that such obligation has so
terminated. If any such change shall make it unlawful for any
Bank to maintain any Eurodollar Loan or CD Loan made by it
hereunder, such Bank shall, upon the happening of such event,
notify Borrower thereof by telephone, confirmed in writing (with
a copy to Depositary Bank, which shall give prompt notice thereof
to each other Bank), stating the reasons therefor and Borrower
shall, at such time as required by law and no later than at the
end of the Interest Period of such Loan, convert such Eurodollar
Loan or CD Loan into a Prime Rate Loan by such Bank pursuant to
the provisions (other than as to prior notice, to the extent that
compliance therewith would violate applicable law) of Article V.
If prior to the Revolver Expiration Date circumstances
subsequently change so that any such Bank shall no longer be so
affected, such Bank shall reinstate its Commitment to make
Eurodollar Loans or CD Loans upon written notice to Borrower
thereof (with a copy to Depositary Bank, which shall give prompt
notice thereof to each other Bank).
SECTION 4.3. Optional Prepayment. Borrower may from
time to time, upon at least three Eurodollar Days' prior written
notice to each Bank, prepay the Loans in whole or in part,
subject to the provisions of Sections 6.1 and 6.3, without
premium or penalty other than as provided in Section 4.5;
provided however, that such optional prepayment shall, if it
occurs before the Revolver Expiration Date, not reduce the Credit
and any partial prepayment shall be in an aggregate principal
amount of at least $5,000,000 and an integral multiple of
$1,000,000.
SECTION 4.4. Interest on Principal Prepaid. Any
prepayment of principal of the Loans shall include accrued
interest to the date of prepayment on the principal amount being
prepaid. Upon any conversion of a Fixed Rate Loan pursuant to
Section 4.2, 5.6 or 5.7, Borrower shall on the date of such
conversion pay accrued interest on such Fixed Rate Loan to such
date. Payments of interest on account of a conversion pursuant
to Section 4.2, 5.6 or 5.7 shall be made directly to each Bank so
affected.
SECTION 4.5. Prepayment Compensation. If (i) any
optional or mandatory payment or prepayment of a Eurodollar Loan
or CD Loan (including, without limitation, on account of a
reduction or termination of the Credit) or any conversion of a
Eurodollar Loan or CD Loan pursuant to Article V or Section 4.2
is made on a day which is not the originally scheduled last day
(designated in Borrower's notice pursuant to Section 1.2 or 5.4)
of an Interest Period of such Loan, or (ii) the Borrower fails to
borrow, continue, or convert another Loan into, a Eurodollar Loan
or CD Loan on the date for such borrowing, continuation, or
conversion specified in the Borrower's notice pursuant to Section
1.2 or 5.4, Borrower shall pay directly to the Bank having made
such Loan or which would have made such Loan such amount or
amounts as will fully compensate such Bank for any net losses and
expenses incurred by it (or any branch or affiliate thereof) in
connection with its repayment or reinvestment in respect of
funds borrowed by it or deposited with it for the purpose of
making or maintaining such Loan, it being understood that the
amount of any such loss shall be determined with reference only
to reduced earnings derived by such Bank on, and shall not
include any loss of, any principal amount of such funds as the
result of such Bank's reinvestment thereof. Any such payment by
Borrower to any Bank shall be payable on demand made by such Bank
(accompanied by a calculation in reasonable detail of such
payment which, in the absence of demonstrable error, shall be
conclusive and binding as to the amount thereof).
ARTICLE V
SPECIAL PROVISIONS WITH RESPECT TO
CONTINUATION OF FIXED RATE LOANS AND
CONVERSION OF LOANS BETWEEN
EURODOLLARS AND DOMESTIC DOLLARS
SECTION 5.1. Continuation of Eurodollar Loans.
Borrower may elect to continue a group of Eurodollar Loans from
any Eurodollar Period into a subsequent Eurodollar Period,
provided that such continuation shall take place on the last day
of the prior Eurodollar Period (herein, in such case, called a
"Continuation Date"). Such election shall be subject to the
notice requirements of Section 5.4. If no such election is made
in compliance with the requirements hereof and Borrower does not
pay in full the outstanding principal amount of any Eurodollar
Loan on the last day of the Eurodollar Period thereof, such
Eurodollar Loan shall automatically, without any notice from or
to Borrower, be converted into a Prime Rate Loan in accordance
with the other provisions of this Article V (other than as to
prior notice) at the end of such Eurodollar Period.
SECTION 5.1.1. Continuation of CD Loans. Borrower may
elect to continue a group of CD Loans from any CD Interest Period
into a subsequent CD Interest Period, provided that such
continuation shall take place on the last day of the prior CD
Interest Period (herein, in such case, called a "Continuation
Date"). Such election shall be subject to the notice
requirements of Section 5.4. If no such election is made in
compliance with the requirements hereof and Borrower does not pay
in full the outstanding principal amount of any CD Loan on the
last day of the CD Interest Period thereof, such CD Loan shall
automatically, without any notice from or to Borrower, be
converted into a Prime Rate Loan in accordance with the other
provisions of this Article V (other than as to prior notice) at
the end of such CD Interest Period.
SECTION 5.2. Conversion. Borrower may elect (i) on
any Eurodollar Day to convert any outstanding Domestic Loans into
Eurodollar Loans or any outstanding Eurodollar Loans into
Domestic Loans and (ii) on any Business Day to convert any
outstanding CD Loans into Prime Rate Loans or any outstanding
Prime Rate Loans into CD Loans (herein, in such case, called a
"Conversion Date"), it being understood that any such conversion
of a Eurodollar Loan or CD Loan into another type of Loan on a
day other than the last day of the Eurodollar Period or CD
Interest Period, as the case may be, of such Loan shall be
subject to the applicable provisions of Section 4.5. Such
election shall be subject to the notice requirements of Section
5.4.
SECTION 5.3. Restrictions on Borrower's Continuation
and Conversion Rights. Notwithstanding any other provisions of
this Article V, Banks shall not be obligated to effect (i) any
continuation or conversion under this Article V, so long as any
Event of Default or Credit Suspension Event has occurred and
remains continuing or (ii) any continuation of any type of Loan
outstanding or any conversion of any outstanding type of Loan
into another type of Loan so long as any of the circumstances
described in Sections 4.2, 5.5, 5.6 and 5.7 affecting such
continuation or conversion have occurred and remain continuing.
SECTION 5.4. Notice of Continuations and Conversions.
Except as otherwise provided in this Agreement, Borrower shall,
at least three Eurodollar Days prior to any Continuation Date or
Conversion Date involving a Eurodollar Loan, or at least two
Business Days prior to any Continuation Date involving a CD Loan
or conversion of a CD Loan into a Prime Rate Loan or Prime Rate
Loan into a CD Loan, give notice to Depositary Bank (which shall
give prompt notice thereof to each other Bank) of such proposed
continuation or conversion, and in the case of any Eurodollar
Loans or CD Loans to be continued or to be made by conversion on
such date, as the case may be, the duration of the subsequent
Eurodollar Period or CD Interest Period thereof.
SECTION 5.5. Interest Rates Unascertainable. In the
event that, prior to any Borrowing Date of any group of
Eurodollar Loans or CD Loans, Banks having, in the aggregate, a
Percentage of 66 2/3% or more shall have determined (which
determination shall be conclusive and binding on all parties
hereto) that (i) with respect to Eurodollar Loans and CD Loans,
the circumstances described in the third sentence of Section
3.1.4 have occurred, or that, (ii) by reason of other
circumstances affecting the London interbank eurodollar market or
certificate of deposit market, adequate and reasonable means do
not exist for ascertaining the Eurodollar Interest Rate or CD
Rate applicable to such group of Eurodollar Loans or CD Loans,
(a) such Banks shall give notice of such determination promptly
(and in any event within three Eurodollar Days after making such
determination with respect to Eurodollar Loans and within two
Business Days after making such determination with respect to CD
Loans) to the other parties hereto and, (b) with respect to any
new Eurodollar Loans or CD Loans, as the case may be, Borrower's
request for Eurodollar Loans or CD Loans, as the case may be,
shall be deemed a request for Prime Rate Loans and (c) with
respect to outstanding Eurodollar Loans or CD Loans, as the case
may be, to be continued on such Borrowing Date, such Loans shall
be converted into Prime Rate Loans in accordance with the
provisions of this Article V on such Borrowing Date,
notwithstanding any failure of Borrower to comply with the notice
provisions of Section 1.2 or 5.4, as the case may be.
SECTION 5.6. Bank Unable to Make Eurodollar Loan. In
the event that, prior to any Borrowing Date of any Eurodollar
Loan as Borrower shall request in its relevant notice of
borrowing pursuant to Section 1.2 or 5.4, any Bank requested to
make or continue such Eurodollar Loan shall (i) have determined
(which determination if made in good faith shall be conclusive
and binding on all parties hereto) that Dollar deposits in the
relevant amount and for the relevant Eurodollar Period for such
Eurodollar Loan are not available to such Bank in the London
interbank eurodollar market by reason of law or otherwise, or
(ii) learn of any change in (including the introduction of any
new) applicable laws or regulations, or in the interpretation
thereof by any governmental or other regulatory authority charged
with the administration thereof, which shall make it unlawful for
such Bank to make or continue such Eurodollar Loan for the
proposed duration thereof, such Bank shall promptly give notice
of such determination to Borrower (with a copy to Depositary
Bank, which shall give prompt notice thereof to each other Bank)
and (a) with respect to any new Eurodollar Loan, Borrower's
request for such Loan shall be deemed a request for a Prime Rate
Loan, and (b) with respect to any outstanding Eurodollar Loan to
be continued on such Borrowing Date, such Loan shall be converted
into a Prime Rate Loan in accordance with the provisions of this
Article V on such Borrowing Date, notwithstanding any failure of
Borrower to comply with the notice provisions of Section 1.2 or
5.4, as the case may be.
SECTION 5.7. Conversions Affecting Some Banks. Within
ten days of notification by any Bank that any of the
circumstances described in Section 3.1.5 or 3.1.7 shall have
occurred and remain continuing with respect to any outstanding
Eurodollar Loan or CD Loan made by such Bank, Borrower may elect
to convert such Eurodollar Loan or CD Loan to a Prime Rate Loan.
Borrower shall, at least three Eurodollar Days prior to the
proposed Conversion Date in respect of such Eurodollar Loan or
two Business Days prior to the proposed Conversion Date in
respect of such CD Loan, give notice of such conversion to
Depositary Bank (which shall give prompt notice to each other
Bank). The exemption from the ratability provisions of Section
1.1.3 shall apply to all Banks or Loans affected by conversions
made pursuant to this Section or Section 4.2 or 5.6 and so long
as any of the circumstances which permitted or required such
conversion shall remain continuing. Any Bank so affected shall
use all commercially reasonable efforts to cease being so
affected, it being understood that such obligation shall in no
way reduce the rights of Banks hereunder nor require any Bank to
take any action which would have a material adverse effect on
such Bank, to make any Eurodollar Loan at any office located in
the United States or to fund any Eurodollar Loan in domestic
Dollars.
ARTICLE VI
MAKING AND PRORATION OF PAYMENTS; OFFSET
SECTION 6.1. Making of Payments. All payments made by
Borrower hereunder shall be in immediately available funds and,
except for payments pursuant to Sections 1.3(b), 3.1.5, 3.1.7 and
4.5 and as otherwise indicated in Sections 3.2 and 4.4, shall be
made to Depositary Bank at its address set forth below its
signature hereto not later than 12:30 p.m., New York City time,
on the date due; funds received after that hour shall be deemed
to have been received by Depositary Bank on the next Eurodollar
Day or Business Day, as the case may be. Depositary Bank shall
remit in immediately available funds to each Bank or other holder
its share of all such payments received by Depositary Bank for
the account of such Bank or holder, as determined pursuant to
Section 6.3, promptly (and, in the event of any payment received
prior to 12:30 p.m., New York City time, on any Business Day, on
such Business Day).
SECTION 6.2. Payment on Revolver Expiration Date. Any
Borrower may effect payment of all or part of the Revolving
Loans, together with accrued interest thereon, on the Revolver
Expiration Date by directing Depositary Bank, in Borrower's
notice of its proposed borrowing of the Term Loans pursuant to
Section 1.2, to apply the proceeds of the Term Loans to the
extent necessary to the concurrent payment of principal of and
interest on the Revolving Loans; provided, that the aggregate
principal amount of the Term Loan shall not exceed the amount of
the Credit.
SECTION 6.3. Allocation of Payments. All payments of
principal of the Revolving Notes and Term Notes by Borrower shall
be for the account of the holders of the Revolving Notes and Term
Notes pro rata according to the respective unpaid principal
amounts of the Revolving Notes and Term Notes held by them, and
shall be applied by each such holder (except as Borrower may, in
a manner not inconsistent with other terms and provisions hereof,
otherwise elect in a notice, furnished on or prior to the date of
such payment, to Depositary Bank, which shall give prompt notice
thereof to each other Bank) first to its then outstanding
Domestic Loans other than Loans made by conversions pursuant to
Section 4.2, 5.6 or 5.7 (herein called an "Equivalent Domestic
Loan"), second to any then outstanding Equivalent Domestic Loans,
and finally to its then outstanding Eurodollar Loans. (For
purposes of this Section, any Equivalent Domestic Loan shall be
deemed an ordinary Domestic Loan to the extent that the
Eurodollar Loan from which such Equivalent Domestic Loan was
converted would otherwise have been converted to any ordinary
Domestic Loan.)
All payments of interest on Domestic Loans hereunder, except
Equivalent Domestic Loans made by an affected Bank pursuant to
Section 4.2, 5.6 or 5.7, shall be for the account of the holders
of the Revolving Notes and Term Notes pro rata according to the
respective unpaid principal amounts of Domestic Loans evidenced
by the Revolving Notes and Term Notes held by them; all payments
of interest on Equivalent Domestic Loans made by an affected Bank
pursuant to Section 4.2, 5.6 or 5.7 shall be for the account of
the holders of the Revolving Notes and Term Notes pro rata
according to the respective unpaid principal amounts of
Equivalent Domestic Loans evidenced by the Revolving Notes and
Term Notes held by them; and all payments of interest on
Eurodollar Loans hereunder, except those pursuant to Section 4.4
on account of a conversion pursuant to Section 4.2, 5.6 or 5.7,
shall be for the account of the holders of the Revolving Notes
and Term Notes pro rata according to the respective unpaid
principal amounts of Eurodollar Loans evidenced by the Revolving
Notes and Term Notes held by them.
All payments of facility fees shall be for the account of all
Banks pro rata according to the daily average amount of each
Bank's Commitment, provided that any reduction of facility fees
in respect of Equivalent Domestic Loans that are Prime Rate Loans
shall be borne pro rata by each affected Bank under Section 4.2,
5.5, 5.6 or 5.7.
Notwithstanding any other provision of this Section 6.3
payments of principal, interest, facility fees and other
obligations hereunder to any Bank upon termination of its
Commitment pursuant to Section 1.1 or pursuant to Section 3.1.7
shall be solely for the account of such Bank.
SECTION 6.4. Proration of Other Recoveries. If any
Bank or other holder of a Revolving Note or Term Note shall
obtain any payment or other recovery (whether voluntary,
involuntary, by application of offset or otherwise), other than
a prepayment compensation pursuant to Section 4.5, on account of
principal of or interest on any Revolving Note or Term Note, or
facility fees, in excess of its pro rata share, as determined
pursuant to Section 6.3, of payments and other recoveries
obtained by all Banks or other holders on account of principal of
and interest on Revolving Notes or Term Notes then held by them,
or facility fees, such Bank or other holder shall purchase from
the other Banks or holders such participation in the Revolving
Notes or Term Notes held by them, or shall make such other
payments, as shall be necessary to cause such purchasing Bank or
other holder to share the excess payment or other recovery
ratably with each of them; provided, however, that if all or any
portion of the excess payment or other recovery is thereafter
recovered from such purchasing holder, the purchase shall be
rescinded and the purchase price restored to the extent of such
recovery, but without interest.
SECTION 6.5. Offset. In addition to and not in
limitation of all rights of offset that any Bank or other holder
of a Note may have under applicable law, each Bank or other
holder of a Note shall, upon the occurrence of any Event of
Default described in Section 10.1.3 or any Credit Suspension
Event which would constitute such an Event of Default described
in Section 10.1.3, have the right, subject to Section 6.4, to
appropriate and apply to the payment of such Note any and all
balances, credits, deposits, accounts or moneys of Borrower then
or thereafter with such Bank or other holder. If, in the
aggregate, the recovery by the Banks by offset, under applicable
law, or otherwise shall exceed the obligations of Borrower under
the Notes and hereunder, any Bank receiving such an excess agrees
to promptly restore the same to Borrower.
ARTICLE VII
WARRANTIES
To induce Banks to grant the Credit and to make Loans
hereunder, the Company warrants to Banks that:
SECTION 7.1. Organization, etc. The Company is a
corporation duly existing and in good standing under the laws of
the State of New York; and each Significant Subsidiary is a
corporation duly existing and in good standing under the laws of
the jurisdiction of its respective incorporation.
SECTION 7.2. Authorization; No Conflict. The
execution and delivery of this Agreement, the borrowings
hereunder, the execution and delivery of the Notes, and the
performance by the Company of its obligations under this
Agreement and the Notes, are within the Company's corporate
powers, have been duly authorized by all necessary corporate
action, have received all necessary governmental approval (if any
shall be required), and do not and will not violate, contravene
or conflict in any material respect with any provision of law or
of the charter or by-laws of the Company or of any judgment or
any material agreement or indenture binding upon or applicable to
the Company the contravention of or conflict with which would
materially adversely effect the consolidated financial condition
or continued operations of the Company and its Subsidiaries as a
whole or materially impair the ability of the Company to perform
any of its obligations hereunder.
SECTION 7.3. Validity and Binding Nature. This
Agreement is, and the Notes when duly executed and delivered will
be, legal, valid and binding obligations of the Company
enforceable against it in accordance with their respective terms,
subject only to bankruptcy, insolvency, reorganization,
moratorium or similar laws affecting the enforceability of rights
of creditors generally.
SECTION 7.4. Financial Statements. The Company's
audited consolidated financial statements as at December 31, 1992
and unaudited consolidated financial statements as at
September 30, 1993, copies of which have been furnished to each
Bank, have been prepared in conformity with GAAP applied on a
basis consistent with that of the preceding fiscal year or
nine-month period, as the case may be, and fairly present the
financial condition of the Company and its Consolidated
Subsidiaries as at such date and the results of their operations
for the period covered by such statements subject, in the case of
any unaudited interim financial statements, to changes resulting
from normal year-end adjustments.
SECTION 7.5. Litigation. No litigation or arbitration
proceedings are pending or, to the knowledge of the Company,
threatened against the Company or any Significant Subsidiary as
to which there is a reasonable likelihood of an adverse
determination and which would reasonably be expected to have a
material adverse effect on the consolidated financial condition
or continued operations of the Company and its Subsidiaries as a
whole or materially impair the ability of the Company to perform
any of its obligations hereunder.
SECTION 7.6. Liens. None of the assets of the Company
is subject to any mortgage, pledge, title retention lien, or
other lien, encumbrance or security interest which is not
permitted by Section 8.6.
SECTION 7.7. ERISA. Neither the Company nor any
Significant Subsidiary has incurred any liability to the Pension
Benefit Guaranty Corporation in connection with any employee
benefit plan which could reasonably be expected to materially
adversely affect the consolidated financial condition or
continued operations of the Company and its Subsidiaries as a
whole or materially impair the ability of the Company to perform
any of its obligations hereunder.
SECTION 7.8. Investment Company Act. The Company is
not an "investment company," or a company "controlled" by or
"controlling" an "investment company," within the meaning of the
Investment Company Act of 1940, as amended.
SECTION 7.9. Public Utility Holding Company Act.
Neither the Company nor any of its Subsidiaries is a "holding
company," or a "subsidiary company" of a "holding company," or an
"affiliate" of a "holding company" or of a "subsidiary company"
of a "holding company," within the meaning of the Public Utility
Holding Company Act of 1935, as amended.
SECTION 7.10. Regulations G, U, and X. The Company
will not use the proceeds of the Loans in violation of
Regulations G, U, and X of the Board of Governors of the Federal
Reserve System.
ARTICLE VIII
COVENANTS
Until the expiration or termination of the Credit and
thereafter until all Liabilities are paid in full, the Company
agrees that, unless at any time Banks having, in the aggregate,
a Percentage of 66 2/3% or more shall otherwise expressly consent
in writing, it will:
SECTION 8.1. Reports, Certificates and Other
Information. Furnish to each Bank:
SECTION 8.1.1. Audit Report. Within 120 days after
each fiscal year of the Company, a copy of an annual audit report
of the Company and its Subsidiaries prepared on a consolidated
basis and in conformity with GAAP, duly certified by, and
containing an opinion of, Ernst & Young or other independent
certified public accountants of recognized national standing
selected by the Company, which opinion shall be unqualified
(excepting any qualification relating to any change in the
application of GAAP concurred in by such accountants). The
requirements of this Section (other than the requirement that any
opinion shall be unqualified as aforesaid) shall be satisfied by
the Company's furnishing each Bank with a copy of its annual
report on Form 10-K filed with the Securities and Exchange
Commission in accordance with the instructions therefor.
SECTION 8.1.2. Interim Reports. Within 60 days after
each quarter (except the last quarter) of each fiscal year of the
Company, a copy of an unaudited financial statement of the
Company and its Subsidiaries prepared on a consolidated basis and
in conformity with GAAP applied on a basis consistent with the
most recent audit report referred to in Section 8.1.1, signed by
a proper accounting officer of the Company and consisting of at
least a balance sheet as at the close of such quarter, a
statement of earnings for such quarter and for the period from
the beginning of such fiscal year to the close of such quarter
and a statement of cash flows for the period from the beginning
of such fiscal year to the close of such quarter. The
requirements of this Section shall be satisfied by the Company's
furnishing each Bank with a copy of its quarterly report on Form
10-Q filed with the Securities and Exchange Commission in
accordance with the instructions therefor.
SECTION 8.1.3. Certificates. Contemporaneously with
the furnishing of a copy of each annual audit report and of each
quarterly statement provided for in Section 8.1.1 or 8.1.2, a
certificate dated the date of such annual report or such
quarterly statement and signed by the Chairman of the Board, any
Senior Vice President, the chief financial officer or the
Treasurer of Borrower to the effect that no Event of Default or
Credit Suspension Event has occurred and is continuing or, if
there is any such event, describing it and the steps, if any,
being taken to cure it.
SECTION 8.1.4. Reports to SEC and to Shareholders.
Copies of each report on Form 10-K, 10-Q or 8-K (excluding
exhibits thereto) made by any Borrower with the Securities and
Exchange Commission, and of each annual report, quarterly report,
special report or proxy statement from the Company to its
shareholders generally, promptly after the filing or making
thereof.
SECTION 8.1.5. Notice of Default or Litigation.
Forthwith upon learning of the occurrence of an Event of Default,
or a Credit Suspension Event, or of the institution of, or any
adverse determination in, any litigation or arbitration
proceeding as to which there is a reasonable likelihood of an
adverse determination and which would reasonably be expected to
have a material adverse effect on the consolidated financial
condition or continued operations of the Company and its
Subsidiaries as a whole or materially impair the ability of the
Company to perform any of its obligations hereunder, written
notice thereof describing the same and the steps being taken by
the Company or the Subsidiary affected with respect thereto.
SECTION 8.1.6. ERISA. As soon as practicable after
the occurrence of any Reportable Event (as defined in the
Employee Retirement Income Security Act of 1974), which is
material to the Company and its Significant Subsidiaries taken as
a whole, in connection with any employee pension benefit plan
maintained by the Company or any Significant Subsidiary, written
notice thereof describing the same.
SECTION 8.1.7. Other Information. From time to time
such other information concerning the Company and its
Subsidiaries as any Bank may reasonably request.
SECTION 8.2. Books, Records and Inspections.
Maintain, and cause each Subsidiary to maintain, proper books and
records in the form customarily employed by them; permit, and
cause each Subsidiary to permit, upon reasonable notice and
during normal business hours, access by any Bank to the books and
records of the Company and of any Subsidiary; and permit, and
cause each Subsidiary to permit, any Bank to inspect upon
reasonable notice and during normal business hours the properties
and operations of the Company and of any Subsidiary.
SECTION 8.3. Insurance. Maintain, and cause each
Significant Subsidiary to maintain, such insurance as may be
required by law and such other insurance to such extent and
against such hazards and liabilities, as is customarily
maintained by companies similarly situated.
SECTION 8.4. Taxes and Liabilities. Pay, and cause
each Significant Subsidiary to pay, when due all taxes,
assessments and other liabilities except as contested in good
faith and by appropriate proceedings.
SECTION 8.5. Purchase or Redemption of the Company's
Securities; Dividend Restrictions. Not purchase, prepay or
redeem, or permit any Subsidiary to purchase, any shares of the
capital stock of the Company, not declare or pay any dividends
thereon (other than stock dividends), not make any distribution
to shareholders or set aside any funds for any such purpose, not
prepay, and not permit any Subsidiary to purchase or prepay, any
subordinated indebtedness for borrowed money of the Company if,
after giving effect thereto, any Event of Default or Credit
Suspension Event shall have occurred and be continuing; provided
that the foregoing shall not prevent the payment of any dividend
or distribution within 60 days of the declaration thereof if, on
the date of such declaration, such dividend or distribution would
have complied with this Section 8.5.
SECTION 8.6. Liens. If the ratio of Consolidated Debt
to Consolidated Capitalization of the Company is more than
0.35:1, not create, incur, assume or suffer to exist any
mortgage, pledge, lien or other encumbrance of any kind
(including the charge upon property purchased under conditional
sales or other title retention agreements) upon, or any security
interest in, any of its property or assets, whether now owned or
hereafter acquired, except (i) liens for taxes, assessments and
governmental charges not delinquent or being contested in good
faith or by appropriate proceedings and for which adequate
reserves have been established in accordance with GAAP,
(ii) existing liens securing indebtedness, including mortgage
debt, as reflected in the Company's consolidated balance sheet as
of September 30, 1993, (iii) liens arising in favor of the United
States Government, any state or local government or any
subdivision or agency thereof in the ordinary course of the
Company's business with any of the foregoing for advances,
progress payments or partial prepayments, (iv) liens in
connection with workers' compensation, unemployment insurance or
social security obligations, (v) liens or deposits or pledges to
secure bids, tenders, contracts (other than contracts for
repayment of borrowed money), leases, statutory obligations,
surety and appeal bonds, indemnity, performance and similar bonds
and other obligations of like nature arising in the ordinary
course of business, (vi) mechanics', workmen's, materialmen's,
carriers', warehousemen's or other like liens arising in the
ordinary course of business with respect to obligations which are
not due or which are being contested in good faith or by
appropriate proceedings and for which adequate reserves have been
established in accordance with GAAP, (vii) liens arising out of
judgments or awards with respect to which appeals are being
prosecuted, levy of execution pending such appeal having been
stayed, (viii) rights-of-way, easements, water rights, sewage and
drainage rights, zoning or use regulations or similar defects in
title which do not materially impair the use of any property for
the purposes for which held, (ix) the lien or any right or
privilege reserved in leases for rent to secure compliance with
the terms of any lease, but not including any lien arising from
a violation of any lease provision other than one relating to
conditional assignment of rents, (x) liens of attachment not
exceeding in the aggregate $15,000,000 outstanding at any one
time, (xi) liens of attachment exceeding in the aggregate
$15,000,000 (but not exceeding in the aggregate $150,000,000)
outstanding at any one time, provided, however, that any such
liens shall be released, discharged or vacated by bonding or
otherwise within 30 days, (xii) deposits to obtain releases of
liens imposed by law and permitted hereunder, (xiii) any
mortgage, encumbrance or other lien upon, or security interest
in, any property or asset (whether real, personal or mixed)
hereafter acquired created contemporaneously with or within 365
days after such acquisition to secure or provide for the payment
or financing of any part of the purchase price thereof, or the
assumption of any mortgage, encumbrance or lien upon, or security
interest in, any such property or asset hereafter acquired
existing at the time of such acquisition, or the acquisition of
any such property or asset subject to any mortgage, encumbrance
or other lien or security interest without the assumption thereof
(provided, at any one time that each such mortgage, encumbrance,
lien or security interest shall attach only to the property or
asset so acquired and improvements thereon), (xiv) other liens
which do not, in the aggregate, relate to or secure obligations
exceeding 5% of Consolidated Capitalization, (xv) any encumbrance
or lien upon margin stock and (xvi) any renewal, modification,
extension, refinancing or replacement of any mortgage,
encumbrance, lien or security interest permitted under clause
(ii), (xiii) or (xiv), provided that the amount of indebtedness
secured thereby is not increased and that any such mortgage,
encumbrance, lien, or security interest is limited to all or part
of the same property and any fixed improvement thereon; provided,
that nothing in this Section 8.6 shall be construed as
prohibiting (x) conveyances of property to a political
subdivision pursuant to an industrial revenue or pollution
control bond financing whereby equitable title to such property
remains in the Company (provided, however, any mortgage, deed of
trust or other security interest in the facility in connection
therewith shall not be so excluded), or (y) the deposit of
property or money with a trustee or other entity, or the
establishment of an escrow, trust or similar account, for the
purpose of defeasing indebtedness of the Company.
SECTION 8.7. Mergers and Consolidations. Not be a
party to any merger or consolidation unless (i) after giving
effect to such merger or consolidation, no Event of Default and
no Credit Suspension Event shall have occurred and be continuing,
(ii) the corporation resulting from or surviving such merger or
consolidation (if other than the Company) shall expressly assume
in writing (in a form reasonably acceptable to Banks having, in
the aggregate, a Percentage of 66 2/3% or more) and agree to
perform all the Company's obligations under this Agreement and
(iii) immediately after giving effect to such merger or
consolidation the surviving corporation shall have a Consolidated
Net Worth at least equal to the Consolidated Net Worth of the
Company immediately preceding such merger or consolidation;
provided, that nothing in this Agreement shall prevent the merger
of any Subsidiary with and into the Company or into another
Subsidiary or the liquidation of any Subsidiary.
SECTION 8.8. Sale or Other Disposition of Assets.
Not, and not permit any Subsidiary to, sell or otherwise dispose
of, whether by merger or otherwise, all or any substantial
portion of its assets, except (i) to or with any other Subsidiary
or the Company, (ii) in the ordinary course of business,
(iii) all of the assets of, or the ownership interest in, any
Subsidiary which is not a Significant Subsidiary or (iv) on such
other terms and conditions as shall have been approved by the
Company's Board of Directors but, in the case of any transfer
made pursuant to clause (iii) or (iv), only if, after giving
effect thereto, no Event of Default or Credit Suspension Event
shall have occurred and be continuing.
SECTION 8.9. Interest Coverage and Consolidated Debt
to Consolidated Capitalization Ratio. Not permit, as of the end
of any fiscal quarter, both (A) the ratio of Consolidated EBDIT
to Consolidated Cash Interest Expense for the twelve month period
including such fiscal quarter and the three immediately preceding
fiscal quarters to be less than 2.50 to 1.0 and (B) the ratio of
Consolidated Debt to Consolidated Capitalization at the end of
such fiscal quarter to be more than .60 to 1.0.
ARTICLE IX
CONDITIONS OF LENDING
SECTION 9.1. Initial Revolving Loans. The obligation
of each Bank to make its initial Revolving Loan hereunder is
subject to the receipt by such Bank of all of the following, each
duly executed:
SECTION 9.1.1. Revolving Note. The Revolving Note of
the Company payable to the order of such Bank.
SECTION 9.1.2. Resolutions. Copies of resolutions of
the Board of Directors of the Company authorizing or ratifying
the execution, delivery and performance, respectively, of this
Agreement, the Notes, and other documents provided for in this
Agreement, certified by the Secretary or an Assistant Secretary
of the Company.
SECTION 9.1.3. Consents, etc. Copies of all documents
evidencing any necessary corporate action, consents and
governmental approvals (if any) with respect to this Agreement
and the Notes, certified by the Secretary or an Assistant
Secretary of the Company.
SECTION 9.1.4. Incumbency and Signatures. A
Certificate of the Secretary or an Assistant Secretary of the
Company certifying the names of the officer or officers of the
Company authorized to sign this Agreement and the Notes and other
documents provided for in this Agreement, together with a sample
of the true signature of each such officer.
SECTION 9.1.5. Opinion of Counsel to Borrower. The
opinion of Messrs. Cahill Gordon & Reindel, counsel for the
Company, addressed to Banks, substantially in the form of
Exhibit D.
SECTION 9.1.6. Other. Such other documents as any
Bank may reasonably request.
SECTION 9.2. All Revolving Loans. The obligation of
each Bank to make each Revolving Loan (including, without
limitation, its initial Revolving Loan but excluding, however,
any Loan made by a continuation or conversion pursuant to Article
V and any repayment and reborrowing deemed to have been made
pursuant to Section 1.1.8) is subject to the following further
conditions precedent that:
SECTION 9.2.1. No Default. After giving effect to all
Loans then being made (a) no Event of Default, or Credit
Suspension Event, shall have occurred and be continuing, (b) the
warranties of the Company contained in Sections 7.1, 7.2, 7.3,
7.6, 7.7, 7.8, 7.9 and 7.10 shall be true and correct in all
material respects with the same effect as though made on such
date and (c) if the Borrower of such Loan is a Designated
Subsidiary, the warranties of such Borrower in its Designation
Letter shall be true and correct in all material respects with
the same effect as though made on such date.
SECTION 9.2.2. Confirmatory Certificate. Depositary
Bank shall have received (in sufficient number of signed
counterparts to provide, and Depositary Bank shall provide, one
to each Bank) a certificate dated the date of such requested Loan
and signed by the Chairman of the Board, any Senior Vice
President, the Chief Financial Officer or the Treasurer of the
Company as to the matters set out in Sections 9.2.1 and 9.2.3.
SECTION 9.2.3. Litigation. No litigation, arbitration
proceedings or governmental investigation or proceedings not
disclosed in writing by the Company to Banks prior to the date of
the immediately preceding Revolving Loan hereunder (or in the
case of the initial Revolving Loan, prior to the date of
execution and delivery of this Agreement) is pending or known to
be threatened against the Company or any Subsidiary and no
material development not so disclosed has occurred in any
litigation, arbitration proceeding or governmental proceeding so
disclosed, which in the opinion of Banks having, in the
aggregate, a Percentage of 66 2/3% or more, is likely to
materially adversely affect the consolidated financial condition
or continued operations of the Company and its Subsidiaries as a
whole or materially impair the ability of the Company to perform
its obligations hereunder.
SECTION 9.3. Initial Loan to Any Designated
Subsidiary. The obligation of each Bank to make the initial Loan
to each Designated Subsidiary hereunder is subject to the further
conditions precedent that such Bank shall have received:
SECTION 9.3.1. Basic Documents. The Revolving Note of
such Designated Subsidiary payable to the order of the Bank and,
with respect to such Designated Subsidiary the documents
contemplated by Sections 9.1.2, 9.1.3 and 9.1.4.
SECTION 9.3.2. Designation. The Designation Letter of
such Designated Subsidiary, substantially in the form of
Exhibit E.
SECTION 9.3.3. Opinion of Counsel. A signed copy of
an opinion of counsel to such Designated Subsidiary,
substantially in the form of Exhibit F.
SECTION 9.4. Term Loans. The obligation of each Bank
to make Term Loans is subject to the conditions precedent
(i) that such Bank shall have received the Term Note of Borrower
payable to the order of such Bank, duly executed and dated the
date of such Term Loan, and that the principal of and accrued
interest on all Revolving Notes shall have been or be paid in
full prior to or concurrently with the making of such Term Loan
and (ii) that, if the original principal amount of such Bank's
Term Notes exceeds the principal amount of its Revolving Notes
outstanding immediately prior thereto, each of the conditions
precedent set forth in Sections 9.2.1 through 9.2.3 shall have
been satisfied as if such Term Loan were a Revolving Loan.
ARTICLE X
GUARANTEE
SECTION 10.1. Unconditional Guarantee. For valuable
consideration, receipt whereof is hereby acknowledged, and to
induce each Bank to make Loans to the Designated Subsidiaries,
the Company, as principal and not merely as surety, hereby
unconditionally and irrevocably guarantees to each Bank that:
(i) the principal of and interest on each Loan to each Designated
Subsidiary shall be promptly paid in full when due (whether at
stated maturity, by acceleration or otherwise) in accordance with
the terms hereof, and, in case of any extension of time of
payment, in whole or in part, of such Loan, that all such sums
shall be promptly paid when due (whether at stated maturity, by
acceleration or otherwise) in accordance with the terms of such
extension; and (ii) all other amounts payable hereunder by any
Designated Subsidiary to any Bank shall be promptly paid in full
when due in accordance with the terms hereof (the obligations of
the Designated Subsidiaries under these subsections (i) and (ii)
of this Section 10.1 being the "Obligations").
In addition, the Company hereby unconditionally and irrevocably
agrees that upon default in the payment when due (whether at
stated maturity, by acceleration or otherwise) of any principal
of, or interest on, any Loan to any Designated Subsidiary or such
other amounts payable by any Designated Subsidiary to any Bank,
the Company will forthwith pay the same, without further notice
or demand.
SECTION 10.2. Guarantee Absolute. The Company
guarantees that the Obligations will be paid strictly in
accordance with the terms of this Agreement, regardless of any
law, regulation or order now or hereafter in effect in any
jurisdiction affecting any of such terms or the rights of any
Bank with respect thereto. The liability of the Company under
this guarantee shall be absolute and unconditional irrespective
of: (i) any lack of validity or enforceability of this Agreement
or any other agreement or instrument relating thereto; (ii) any
change in the time, manner or place of payment of, or in any
other term of, all or any of the Obligations,or any other
amendment or waiver of or any consent to departure from this
Agreement (including, without limitation, any extension of the
Revolver Expiration Date or any Commitment Increase); (iii) any
release or amendment or waiver of or consent to departure from
any other guaranty, for all or any of the Obligations; or (iv)
any other circumstance which might otherwise constitute a defense
available to, or a discharge of, the Company, any Borrower or a
guarantor.
The guarantee shall continue to be effective or be reinstated, as
the case may be, if at any time any payment of any of the
Obligations is rescinded or must otherwise be returned by any of
the Banks upon the insolvency, bankruptcy or reorganization of
the Company or any Borrower or otherwise, all as though such
payment had not been made.
SECTION 10.3. Waivers. The Company hereby expressly
waives diligence, notice of acceptance of this guarantee,
presentment, demand for payment, protest, any requirement that
any right or power be exhausted or any action be taken against
any Designated Subsidiary or against any other guarantor of all
or any portion of the Loans, and all other notices and demands
whatsoever.
The Company irrevocably waives any and all rights to
which it may be entitled, by operation of law or otherwise, upon
the making of any payment under the guarantee contained in this
Article X to be subrogated to the rights of the payee against any
Designated Subsidiary with respect to such payment or to
otherwise be reimbursed, indemnified or exonerated by a
Designated Subsidiary in respect thereof.
SECTION 10.4. Remedies. Each of the Banks may pursue
its respective rights and remedies under this Article X and shall
be entitled to payment hereunder notwithstanding any other
guarantee of all or any part of the Loans to the Designated
Subsidiaries, and notwithstanding any action taken by any such
Bank to enforce any of its rights or remedies under such other
guarantee, or any payment received thereunder. The Company
hereby irrevocably waives any claim or other rights that it may
now or hereafter acquire against the Designated Subsidiary that
arise from the existence, payment, performance or enforcement of
the Company's obligations under this Article X, including,
without limitation, any right of subrogation, reimbursement,
exoneration, contribution or indemnification and any right to
participate in any claim or remedy of the Banks against the
Designated Subsidiary, whether or not such claim, remedy or right
arises in equity or under contract, statute or common law,
including, without limitation, the right to take or receive from
the Designated Subsidiary, directly or indirectly, in cash or
other property or by set-off or in any other manner, payment or
security on account of such claim, remedy or right. If any
amount shall be paid to the Company in violation of the preceding
sentence at any time when all the Obligations shall not have been
paid in full, such amount shall be held in trust for the benefit
of the Banks and shall forthwith be paid to the Depositary Bank
for the accounts of the respective Banks to be credited and
applied to the Obligations, whether matured or unmatured, in
accordance with the terms of this Agreement, or to be held as
collateral for any Obligations or other amounts payable under
this Agreement thereafter arising. The Company acknowledges that
it will receive direct and indirect benefits from the financing
arrangements contemplated by this Agreement and that the waiver
set forth in this section is knowingly made in contemplation of
such benefits.
SECTION 10.5. Survival. This guarantee is a
continuing guarantee and shall (i) remain in full force and
effect until payment in full after the Termination Date of the
Obligations and all other amounts payable under this guarantee,
(ii) be binding upon the Company, its successors and assigns,
(iii) inure to the benefit of and be enforceable by each Bank and
its successors, transferees and assigns and (iv) be reinstated if
at any time any payment to a Bank hereunder is required to be
restored by such Bank.
ARTICLE XI
EVENTS OF DEFAULT AND THEIR EFFECT
SECTION 11.1. Events of Default. Each of the
following shall constitute an Event of Default under this
Agreement:
SECTION 11.1.1. Non-Payment of Notes, etc. Default,
and continuance thereof for five days after the due date thereof,
in the payment when due of any interest on any Note or any
facility fee, or default in the payment when due of any principal
of any Note or other amounts payable by any Borrower hereunder
(excluding, however, to the extent disputed by Borrower in good
faith, amounts payable pursuant to Section 3.1.5, 3.1.7 or 4.5 in
an aggregate amount not exceeding $1,000,000 for all Banks).
SECTION 11.1.2. Non-Payment of Other Indebtedness.
Default in the payment when due (subject to any applicable grace
period), whether by acceleration or otherwise, of any other
indebtedness for borrowed money or other obligations evidenced by
a note, debenture, or similar instrument (including capitalized
lease obligations) in an aggregate principal amount exceeding
$50,000,000 of, or guaranteed by, the Company or any Significant
Subsidiary or default in the performance or observance of any
obligation or condition with respect to any such other
indebtedness if the effect of such default in the performance or
observance is to accelerate the maturity of any such indebtedness
or to permit the holder or holders thereof, or any trustee or
agent for such holders, to cause such indebtedness to become due
and payable prior to its expressed maturity.
SECTION 11.1.3. Bankruptcy, Insolvency, etc. The
Company or any Significant Subsidiary becomes insolvent or admits
in writing its inability to pay its debts or fails to pay its
debts, generally as they become due; or the Company or any
Significant Subsidiary applies for, consents to, or acquiesces in
the appointment of, a trustee, custodian or receiver for the
Company or such Significant Subsidiary or any property thereof,
or makes a general assignment for the benefit of creditors; or,
in the absence of such application, consent or acquiescence, a
trustee, custodian or receiver is appointed for the Company or
any Significant Subsidiary or for a substantial part of the
property of any thereof and is not discharged within 60 days; or
any bankruptcy, reorganization, debt arrangement, or other
proceeding or case under any bankruptcy or insolvency law, or any
dissolution or liquidation proceeding (except the voluntary
dissolution, not under any bankruptcy or insolvency law, of a
Significant Subsidiary), is commenced in respect of the Company
or any Significant Subsidiary, and if such proceeding is not
commenced by the Company or Significant Subsidiary, it is
consented to or acquiesced in by the Company or Significant
Subsidiary or remains for 60 days undismissed; or any corporate
action is taken by the shareholder(s) or board of directors of
the Company or any Significant Subsidiary to authorize or further
any of the actions described in this Section 11.1.3.
SECTION 11.1.4. Non-Compliance with This Agreement.
Failure by the Company to comply with or to perform any provision
of this Agreement (and not constituting an Event of Default under
any of the preceding provisions of this Article XI) and
continuance of such failure for 30 days, after notice thereof to
the Company from any Bank or the holder of any Note stating that
such Bank or holder is of the opinion that such failure is
material; provided, that, any failure by the Company to comply
with any provision of this Agreement solely as a result of a
change in GAAP shall not constitute an Event of Default.
SECTION 11.1.5. Warranties. Any warranty made by the
Company herein is breached in any material respect, or any
schedule, certificate, financial statement or report furnished by
the Company to any Bank is false or misleading in any material
respect on the date as of which the facts therein set forth are
stated or certified.
SECTION 11.1.6. ERISA. The Company or any Significant
Subsidiary incurs any liability to the Pension Benefit Guaranty
Corporation or any successor thereto in excess of $50,000,000.
SECTION 11.2. Effect of Event of Default. If any
Event of Default described in Section 11.1.3 shall occur, the
Credit (if it has not theretofore terminated) shall immediately
terminate and all Notes and all other amounts payable hereunder
shall become immediately due and payable, all without presentment
or notice of any kind, all of which are hereby waived; and, in
the case of any other Event of Default which shall have occurred
and remain continuing, Banks having, in the aggregate, a
Percentage of 66 2/3% or more may, by the giving of notice in
writing to the Company, declare the Credit (if it has not
theretofore terminated) to be terminated and/or all Notes and all
other amounts payable hereunder to be immediately due and
payable, whereupon the Credit shall immediately terminate and/or
all Notes and all other amounts payable hereunder shall become
immediately due and payable, all without presentment or notice of
any kind, all of which are hereby waived. Notwithstanding the
foregoing, the effect as an Event of Default of any event
described in Section 11.1.1 or Section 11.1.3 may be waived by
the written concurrence of Banks having, in the aggregate, a
Percentage of 100%, and the effect as an Event of Default of any
other event described in Section 11.1 may be waived by the
written concurrence of Banks having, in the aggregate, a
Percentage of 66 2/3% or more.
SECTION 11.3. Defaults by Designated Subsidiaries. If
any of the following defaults with respect to any Designated
Subsidiary have occurred and are continuing then Section 11.4
shall apply:
SECTION 11.3.1. Warranties. Any warranty made by such
Designated Subsidiary herein or in the Designation Letter
pursuant to which it is designated as a Borrower hereunder is
breached in any material respect or any schedule, certificate,
financial statement or report furnished by such Designated
Subsidiary to any Bank is false or misleading in any material
respect on the date as of which the facts therein set forth are
stated or certified.
SECTION 11.3.2. Non-Payment of Other Indebtedness.
Default in the payment when due (subject to any applicable grace
period), whether by acceleration or otherwise, of any other
indebtedness for borrowed money or other obligations evidenced by
a note, debenture, or similar instrument (including capitalized
lease obligations) in a principal amount exceeding $50,000,000
of, or guaranteed by, a Designated Subsidiary or default in the
performance or observance of any obligation or condition with
respect to any such other indebtedness if the effect of such
default in the performance or observance is to accelerate the
maturity of any such indebtedness or to permit the holder or
holders thereof, or any trustee or agent for such holders, to
cause such indebtedness to become due and payable prior to its
expressed maturity.
SECTION 11.3.3. Bankruptcy, Insolvency, etc. A
Designated Subsidiary becomes insolvent or admits in writing its
inability to pay its debts or fails to pay its debts, generally
as they become due; or the Designated Subsidiary applies for,
consents to, or acquiesces in the appointment of, a trustee,
custodian or receiver for such Designated Subsidiary or any
property thereof, or makes a general assignment for the benefit
of creditors; or, in the absence of such application, consent or
acquiescence, a trustee, custodian or receiver is appointed for
any Designated Subsidiary or for a substantial part of the
property of any thereof and is not discharged within 60 days; or
any bankruptcy, reorganization, debt arrangement, or other
proceeding or case under any bankruptcy or insolvency law, or any
dissolution or liquidation proceeding is commenced in respect of
the Company or any Significant Subsidiary, and if such
proceeding is not commenced by such Designated Subsidiary, it is
consented to or acquiesced in by such Designated Subsidiary or
remains for 60 days undismissed; or any corporate action is taken
by the shareholder(s) or board of directors of any Designated
Subsidiary to authorize or further any of the actions described
in this Section 11.3.3.
SECTION 11.3.4. Non-Compliance with This Agreement.
Failure by Designated Subsidiary to comply with or to perform any
provision of this Agreement (and not constituting an Event of
Default under any of the preceding provisions of this Section
11.3) and continuance of such failure for 30 days, after notice
thereof to the Company and the Designated Subsidiary from any
Bank or the holder of any Note stating that such Bank or holder
is of the opinion that such failure is material.
SECTION 11.4. Effect of Default by Designated
Subsidiary. If any default described in Section 11.3.2 or 11.3.3
shall occur, without any action by the Bank, the Banks shall have
no obligation to make Loans to such Designated Subsidiary under
this Agreement and all Loans under this Agreement to such
Designated Subsidiary and all other amounts payable hereunder by
such Designated Subsidiary shall become immediately due and
payable, all without presentment or notice of any kind; and, in
the case of any other default described in Section 11.3 which
shall have occurred and remain continuing, Banks having, in the
aggregate, a Percentage of 66 2/3% or more may, by the giving of
notice in writing to the Company, decline to make further Loans
to such Designated Subsidiary and/or declare all Loans under this
Agreement to such Designated Subsidiary and all other amounts
payable hereunder by such Designated Subsidiary to be immediately
due and payable, without presentment or notice of any kind.
Notwithstanding the foregoing, the effect of any event described
in Section 11.3 may be waived by the written concurrence of Banks
having, in the aggregate, a Percentage of 66 2/3% or more.
ARTICLE XII
CERTAIN DEFINITIONS
When used herein, the following terms shall have the
following meanings (which shall be equally applicable to the
singular and plural forms thereof):
"Alternate Currency" means any currency other than
Dollars which is freely transferable and convertible into
Dollars.
"Alternate Currency Loan" see the definition below of
"Loan."
"Alternate Currency Payment Office" has the meaning
specified in Section 1.3(e).
"Alternate Rating Agency" shall mean (i) Fitch
Investors Service, Inc., (ii) Duff & Phelps Credit Rating Co. or
(iii) another nationally recognized rating agency selected by the
Borrower to rate its senior debt securities, which, in the case
of clause (iii), shall be approved by Banks having, in the
aggregate, a Percentage of at least 66 2/3%.
"Assuming Bank" shall mean, at any time, a Person which
proposes to become a Bank hereunder pursuant to Section 1.1.8.
"Assumption Agreement" shall mean an agreement by which
an institution agrees to become a Bank party to this Agreement
pursuant to Section 1.1.8.
"Bank" shall mean the Banks listed on the signature
pages hereof and each institution that becomes a party hereto
pursuant to Section 1.1.8 or 13.5.
"Bank Indemnitees" -- see Section 13.9.
"Borrower" shall mean the Company or any Designated
Subsidiary, as the context may require.
"Borrowing Date" shall mean, with respect to each Loan,
the date upon which a Bank makes such Loan hereunder to Borrower.
"Business Day" shall mean a day on which banks are not
authorized or required by law to close for business in New York
City.
"CD Interest Period" shall mean as to each CD Loan, the
period which shall begin on (and include) the most recent
Borrowing Date with respect to such Loan and shall end, as
Borrower shall elect in its notice pursuant to Section 1.2 or
5.4, as the case may be, on (and include) the day 30, 60, 90 or
180 days thereafter, as selected by Borrower; provided that no CD
Interest Period commencing prior to the Revolver Expiration Date
or the final maturity, by acceleration or otherwise, of all of
the Term Loans shall end later than such Revolver Expiration Date
or date of maturity of the Term Loans, as the case may be, and
further provided that any CD Interest Period which would
otherwise end on a day which is not a Business Day shall be
extended to the next succeeding Business Day.
"CD Loan" -- see definition below of "Loan".
"CD Margin" -- see Section 3.1.8.
"CD Rate" shall mean for each CD Interest Period a rate
per annum which is equal to the CD Margin as of the first day of
the applicable Interest Period plus the sum (rounded if necessary
to the nearest 1/20 of 1%) of (i) the rate obtained by dividing
(x) the arithmetic mean as calculated by the Depositary Bank of
the respective rates per annum (rounded if necessary to the
nearest 1/20 of 1%) of the Reference Banks, in each such case
determined by each Reference Bank to be the average of the bid
rates quoted to it at its principal office at approximately 10:00
a.m. New York City time (or as soon thereafter as practicable) on
the first day of the CD Interest Period for such Loan by New York
certificate of deposit dealers of recognized standing selected by
such Reference Bank for the purchase at face value in the
secondary certificate of deposit market of certificates of
deposit of such Reference Bank for a period, and in an amount,
comparable to such CD Interest Period and the principal amount of
the CD Loan which shall be made by such Reference Bank and
outstanding during such CD Interest Period, provided, that, if
such quotations from such dealers are not available to any
Reference Bank, such Reference Bank shall determine a reasonably
equivalent rate on the basis of another source or sources
selected by it, by (y) a percentage equal to 100% minus the
stated maximum rate of all reserve requirements as specified in
Regulation D (including, without limitation, any marginal,
emergency, supplemental, special or other reserves) applicable on
the first day of such CD Interest Period to a negotiable
certificate of deposit in excess of $100,000 with a maturity
equal to such CD Interest Period of any member bank of the
Federal Reserve System, plus (ii) the daily net annual assessment
rate as estimated by the Depositary Bank on the first day of such
CD Interest Period for determining the current annual assessment
payable by the Depositary Bank to the Federal Deposit Insurance
Corporation for insuring such certificates of deposit.
"Commitment" shall mean the amount set forth opposite
each Bank's signature hereto, as such amount may be reduced or
increased from time to time pursuant to Sections 1.1.6, 1.1.7 and
1.1.8 or Section 13.5.
"Commitment Increase" has the meaning specified in
Section 1.1.8.
"Consolidated Capitalization" shall mean the sum of
Consolidated Debt and Consolidated Net Worth.
"Consolidated Cash Interest Expense" means, with
respect to the Company for any period, total interest expense
deducted in calculating Consolidated Net Income (including that
attributable to capitalized lease liabilities of the Company and
Consolidated Subsidiaries in accordance with GAAP, but excluding
interest expense not payable in cash (including amortization of
discount)), with respect to all outstanding Consolidated Debt, as
determined on a consolidated basis for the Company and
Consolidated Subsidiaries in conformity with GAAP.
"Consolidated Debt" shall mean the sum of all
indebtedness for borrowed money of the Company and Consolidated
Subsidiaries, all indebtedness secured by assets of (and whether
or not assumed by) the Company or any Consolidated Subsidiary
(which indebtedness shall be valued at the lesser of the
outstanding principal amount thereof or the book value of such
assets), all capitalized lease liabilities of the Company and
Consolidated Subsidiaries and all outstanding obligations under
guarantees and similar undertakings with respect to any such
indebtedness or liabilities of Persons other than the Company and
Consolidated Subsidiaries which is required to be reflected on
the Company's balance sheet (excluding any notes thereto) in
accordance with GAAP; provided, that there shall be excluded from
Consolidated Debt any such indebtedness which by its terms is
presently convertible into or exchangeable for capital stock of
the Company at a price per share at least 15 percent below the
Current Market Price per share of such capital stock.
"Consolidated EBDIT" shall mean, without duplication,
with respect to the Company and Consolidated Subsidiaries for any
period, the sum of the amounts for such period of (i)
Consolidated Net Income, (ii) provision for taxes based on
income, (iii) depreciation expense, (iv) amortization expense,
(v) total interest expense deducted in calculating Consolidated
Net Income, and (vi) other non-cash items reducing Consolidated
Net Income all as determined on a consolidated basis for the
Company and Consolidated Subsidiaries in conformity with GAAP.
"Consolidated Net Income" shall mean with respect to
the Company for any period, the net income (or loss) of the
Company and Consolidated Subsidiaries on a consolidated basis for
such period taken as a single accounting period determined in
conformity with GAAP; provided that there shall be excluded (i)
the income (or loss) of any Person (other than a Subsidiary of
the Company) in which any other Person (other than the Company or
any of its Subsidiaries) has a joint interest, except to the
extent of the amount of dividends or other distributions actually
paid to the Company or any of its Subsidiaries by such Person
during such period and (ii) the income (or loss) of any Person
accrued prior to the date it becomes a Subsidiary of the Company
or is merged into or consolidated with any of the Company's
Subsidiaries or that Person's assets are acquired by the Company
or any of its Subsidiaries.
"Consolidated Net Worth" shall mean the par value (or
value stated on the books of the Company) of the capital stock of
all classes of the Company and Consolidated Subsidiaries issued
and outstanding, plus (or minus in the case of a surplus
deficit), the amount of the consolidated surplus, whether capital
or earned, of the Company and its Subsidiaries plus the principal
amount of any indebtedness of the Company and the Consolidated
Subsidiaries which by its terms is presently convertible into or
exchangeable for capital stock of the Company at a price per
share at least 15 percent below the Current Market Price per
share of such capital stock.
"Consolidated Subsidiary" shall mean any Subsidiary the
accounts of which are consolidated with those of the Company in
accordance with GAAP.
"Continuation Date" -- see Section 5.1.
"Conversion Date" -- see Section 5.2.
"Credit" shall mean the sum of (i) the aggregate unused
Commitments of all Banks hereunder to make Revolving Loans or
Term Loans plus (ii) the aggregate principal amount of Revolving
Loans or Term Loans outstanding hereunder.
"Credit Suspension Event" shall mean any event which if
it continues uncured will, with lapse of time or notice or lapse
of time and notice, constitute an Event of Default.
"Current Market Price" shall mean for any class of
capital stock of the Company the average for any 20 consecutive
Stock Trading Days ending within 30 days of the date of
determination of the average of the high and low sale prices per
share, or if no sales are reported, the average of the bid and
ask prices per share or, if more than one in either case, the
average of the average bid and average ask prices per share) for
each Stock Trading Day in such 20 consecutive Stock Trading Day
period, as reported in the composite transactions for the New
York Stock Exchange, or if such capital stock is not listed or
admitted to trading on such exchange, as reported in the
composite transactions for the principal national or regional
United States securities exchange on which such capital stock is
listed or admitted to trading or, if such capital stock is not
listed or admitted to trading on a United States national or
regional securities exchange, as reported by the National
Association of Securities Dealers Automated Quotation System
("NASDAQ") or by the National Quotation Bureau Incorporated. A
"Stock Trading Day" means each day on which the securities
exchange or quotation system which is used to determine the
Current Market Price is open for trading or quotation.
"Depositary Bank" -- see Section 1.2.
"Designated Subsidiary" shall mean any corporate
Subsidiary of the Company designated for borrowing privileges
under this Agreement pursuant to Section 13.10 hereof.
"Designation Letter" shall mean, in respect of any
Designated Subsidiary, a letter in the form of Exhibit E hereto
signed by such Designated Subsidiary and the Company.
"Dollars" and the sign "$" shall mean lawful money of
the United States of America.
"Domestic Loan" -- see definition below of "Loan."
"Equivalent Domestic Loan" -- see Section 6.3.
"Eurodollar Day" shall mean a day on which dealings are
carried on in the London Interbank market in Dollars and on which
banks are not authorized or required by law to close for business
in New York City.
"Eurodollar Interest Rate" -- see Section 3.1.2.
"Eurodollar Loan" -- see definition below of "Loan."
"Eurodollar Margin" -- see Section 3.1.8.
"Eurodollar Office" -- see Section 1.1.3.
"Eurodollar Period" shall mean, as to each Eurodollar
Loan, the period which shall begin on (and include) the most
recent Borrowing Date with respect to such Loan and shall end, as
Borrower shall elect in its notice pursuant to Section 1.2 or
5.4, as the case may be, on (and include) the day one, two, three
or six months thereafter, as selected by Borrower; provided that
no Eurodollar Period commencing prior to the Revolver Expiration
Date or the final maturity, by acceleration or otherwise, of all
of the Revolving Loans or Term Loans shall end later than such
Revolver Expiration Date or date of maturity, as the case may be.
Subject to the proviso in the preceding sentence, any Eurodollar
Period which would otherwise end on a day which would not be a
Eurodollar Day shall instead continue to and end on the next
succeeding Eurodollar Day, unless such next succeeding Eurodollar
Day would be the first Eurodollar Day in a calendar month, in
which case such Eurodollar Period shall instead end on the next
preceding Eurodollar Day, and any Eurodollar Period which begins
on the last Eurodollar 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 Eurodollar Period) shall end on the last
Eurodollar Day of a calendar month.
"Event of Default" shall mean any of the events
described in Section 11.1.
"Federal Funds Rate" shall mean for any period, a
fluctuating interest rate equal for each day during such period
to the weighted average of the rates on overnight Federal Funds
transactions with members of the Federal Reserve System arranged
by Federal Funds brokers, as published for each day (or, if such
day is not a Business Day, for the next preceding Business Day)
by the Federal Reserve Bank of New York, or, if such rate is not
so published for any day which is a Business Day, the average of
the quotations for such day on such transactions received by the
Depositary Bank from three Federal Funds brokers of recognized
standing selected by the Depositary Bank.
"Fixed Rate Interest Date" -- see Section 3.1.
"Fixed Rate Loan" -- see definition below of "Loan".
"GAAP" shall mean generally accepted accounting
principles set forth in the opinions and pronouncements of the
Accounting Principles Board of the American Institute of
Certified Public Accountants and statements and pronouncements of
the Financial Accounting Standards Board or in such other
statements by such other entity as may be approved by a
significant segment of the accounting profession, which are
applicable to the circumstances as of the date of determination.
"Increase Date" has the meaning assigned to that term
in Section 1.1.8.
"Indemnified Liabilities" -- see Section 13.9.
"Interest Date" shall mean Fixed Rate Interest Date
and/or Prime Rate Interest Date, as the case may be.
"Interest Period" shall mean a CD Interest Period or a
Eurodollar Period, as the context requires, or both.
"Liabilities" -- see Section 4.1.
"Loan" shall mean each lending by any Bank hereunder.
Particular types of Loans are as follows:
(i) "Alternate Currency Loan" shall mean any Loan
denominated in an Alternate Currency;
(ii) "CD Loan" shall mean any Loan which bears
interest at the CD Rate;
(iii) "Domestic Loan" shall mean any Loan which is
a Prime Rate Loan or a CD Loan;
(iv) "Eurodollar Loan" shall mean any Loan which
bears interest at the Eurodollar Interest Rate;
(v) "Fixed Rate Loan" shall mean a CD Loan or a
Eurodollar Loan;
(vi) "Market Rate Loan" -- see Section 1.3;
(vii) "Prime Rate Loan" shall mean any Loan bearing
interest at the Prime Rate;
(viii) "Revolving Loan" shall mean any Loan made
pursuant to the unused Commitments contained in Section 1.1.1 but
shall exclude any Market Rate Loan; and
(ix) "Term Loan" shall mean any Loan made pursuant
to the commitments contained in Section 1.1.2.
"Market Rate" -- see Section 1.3(a).
"Market Rate Loan" -- see definition above of "Loan."
"Market Rate Note" -- see Section 2.3.
"Notes" shall mean the Revolving Notes, Market Rate
Notes and Term Notes, or any of them.
"Obligations" see Section 10.1.
"Percentage" with respect to any Bank shall mean at
any time the percentage of the Credit represented by such Bank's
Commitment.
"Person" shall mean any corporation, partnership,
association, trust, individual or other entity.
"Prime Rate" shall mean the greater of: (a) the
average of the rates per annum from time to time announced by
each of the Reference Banks at the address set forth below its
signature hereto as such Bank's prime commercial lending rate and
(b) the effective Federal Funds Rate for overnight funds plus 1/2
of 1% per annum.
"Prime Rate Interest Date" -- see Section 3.1.
"Prime Rate Loan" -- see definition of "Loan" above.
"Public Debt Rating" means, as of any date, the
highest rating that has been most recently announced by either
Moody's Investors Service, Inc. ("Moody's") or Standard & Poor's
Corporation ("S&P") or an Alternate Rating Agency in substitution
for Moody's or S&P (but not both), for any class of long-term
unsecured senior debt issued by the Company; provided, that if
the ratings determined by Moody's or S&P (or an Alternate Rating
Agency) differ by more than one rating category the Public Debt
Rating shall be the average of the two ratings. For purposes of
the foregoing, (a) if an Alternate Rating Agency is used, the
ratings provided by such Alternate Rating Agency shall be
converted into an equivalent of Moody's or S&P, as nearly as
practicable, for purposes of determining the Eurodollar Margin or
CD Margin; and (b) if any rating established or deemed to have
been established by Moody's or S&P shall be changed (other than
as a result of a change in the rating system of either Moody's or
S&P), such change shall be effective as of the date on which such
change is first announced publicly by the rating agency making
such change. Any change in the Eurodollar Margin or CD Margin
due to a change in the Public Debt Rating shall be effective for
Interest Periods commencing after the public announcement of the
change in debt rating. If the rating system of either Moody's or
S&P shall change, the Company and the Banks shall negotiate in
good faith to amend the references to specific ratings in this
definition to reflect such changed rating system.
"Reference Banks" shall mean Chemical Bank,
NationsBank of North Carolina N.A. and The Chase Manhattan Bank,
N.A. or, with respect to Eurodollar Loans, the Eurodollar Office
of any of them.
"Regulation D" -- see Section 3.1.2.1.
"Revolver Expiration Date" means the earlier of
January 11, 1998 or the date of termination in whole of the
Commitments.
"Revolving Loan" -- see definition above of "Loan."
"Revolving Note" -- see Section 2.1.
"Significant Subsidiary" shall have the meaning
assigned to such term in Regulation C Section 230.405 promulgated by
the Securities and Exchange Commission pursuant to the Securities
Act of 1933, as amended, as such definition is in effect as of
the date of this Agreement.
"Subsidiary" shall mean a corporation of which the
Company and its other Subsidiaries own directly or indirectly
more than 50% of the ordinary voting power for the election of
directors.
"Term Loan" -- see definition above of "Loan."
"Term Note" -- see Section 2.2.
ARTICLE XIII
GENERAL
SECTION 13.1. Waiver; Amendments. No delay on the
part of any Bank or the holder of any Note in the exercise of any
right, power or remedy shall operate as a waiver thereof, nor
shall any single or partial exercise by any of them of any right,
power or remedy preclude other or further exercise thereof, or
the exercise of any other right, power or remedy. No amendment,
modification or waiver of, or consent with respect to, any
provision of this Agreement or the Notes shall in any event be
effective unless the same shall be in writing (including telegram
or telex) and signed and delivered by the Company and Banks
having an aggregate Percentage of not less than the Percentage
expressly designated herein with respect thereto or, in the
absence of such designation as to any provision of this Agreement
or the Notes, by Banks having, in the aggregate, a Percentage of
66 2/3% or more, and then any such amendment, modification,
waiver or consent shall be effective only in the specific
instance and for the specific purpose for which given. No
amendment, modification, waiver or consent (i) shall extend or
increase the amount of the Credit, the scheduled maturity of the
Notes, or the scheduled date for the payment of interest or fees,
or reduce the fees or the rate of interest payable with respect
to the Notes or modify the provisions of Section 3.1.5, 3.1.7,
4.5, 6.3, 6.4, or 13.9 or modify the provisions of Article X in
a manner adverse to the Banks or impose an additional obligation
on any of the Banks or reduce the aggregate Percentage required
to effect an amendment, modification, waiver or consent without
the consent of all of the Banks or (ii) shall extend the
scheduled maturity of, or the scheduled date for the payment of
interest or fees on, or reduce the principal amount of, or rate
of interest on, any Note without the consent of the holder of
such Note. The provisions of this Section 13.1 may not be
amended or modified without the consent of all of the Banks.
SECTION 13.2. Confirmations. Borrower and each
holder of a Revolving Note agree from time to time, upon written
request received by it from the other, to confirm to the other in
writing the aggregate unpaid principal amount of the Revolving
Loans then outstanding under such Revolving Note; and each such
holder agrees from time to time, upon written request received by
it from Borrower, to make the Revolving Note held by it
(including the schedule attached thereto) available for
reasonable inspection by Borrower at the office of such holder.
Each Bank shall, promptly upon request by Borrower, furnish
Borrower with a photocopy of the schedule attached to such Bank's
Revolving Note.
SECTION 13.3. Notices. Any notice from Borrower to
any Bank (including Depositary Bank) under Section 1.2, 1.1.6,
1.1.8 or 5.4 may be (i) telephonic if confirmed, prior to the
date for taking (or for the effectiveness of) the action
specified in such notice, by a writing received by such Bank or
(ii) by facsimile if confirmed, prior to the date for taking (or
for the effectiveness of) the action specified in such notice, by
telephone. Any other notice hereunder to Borrower or any Bank
(or other holder) shall, except as otherwise expressly provided,
be in writing and, if mailed shall be deemed to have been given
(i) three days after the date when sent by first class mail,
postage prepaid, (ii) one day after sent by overnight delivery
service and, in each case, addressed to Borrower or such Bank (or
other holder) at its address shown below its signature hereto, or
at such other address as it may, by written notice received by
the other parties to this Agreement, have designated as its
address for such purpose. Any Bank or the holder of any Note
giving any waiver, consent or notice to, or making any request
upon, Borrower hereunder shall promptly notify the Depositary
Bank thereof.
SECTION 13.4. 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
generally accepted accounting principles as in effect from time
to time ("GAAP"), applied on a basis consistent (except for
changes concurred in 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 Depositary Bank that it wishes to amend any covenant in
Article VIII to eliminate the effect of any change in generally
accepted accounting principles on the operation of such covenant,
then compliance with such covenant 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 covenant is amended in a manner satisfactory
to the Company and Banks holding, in the aggregate, a Percentage
of 66 2/3% or more.
SECTION 13.5. Participations; Transfers of Notes.
A Bank may assign or sell participations in all or any part of
its Commitment or any Loan to another bank or other entity;
provided that an assignment or participation shall be in a
minimum aggregate amount of $10,000,000; and provided, further,
(a) except in the case of assignments of or participations in
Market Rate Loans, that the Company shall have consented in
writing to the proposed assignment or participation, which
consent shall not be unreasonably withheld; and (b) in the case
of a participation, no such participation shall in any way affect
such Bank's obligations under this Agreement, and provided, that
all amounts payable by any Borrower under Article III shall be
determined as if such Bank had not sold such participation. Upon
execution and delivery of an approriate instrument and payment by
any assignee to the 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
Commitments 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. Upon the consummation of
any assignment pursuant to this Section 13.5, the transferor Bank
and the Borrower shall make appropriate arrangements so that, if
required, a new Note is issued to the assignee.
The agreement executed by the Bank in favor of any
participant shall not give the participant the right to require
such Bank to take or omit to take any action hereunder except
action directly relating to (i) the extension of a payment date
with respect to any portion of the principal of or interest on
any amount outstanding or any fees payable hereunder allocated to
such participant, (ii) the reduction of the principal amount of
any Loan outstanding hereunder, (iii) the reduction of the rate
of interest payable on such amount or any amount of fees payable
hereunder to a rate or amount, as the case may be, below that
which the participant is entitled to receive under its agreement
with such Bank, or (iv) an extension of the Revolver Expiration
Date in accordance with the terms hereof. Each Bank may furnish
to participants (including prospective participants and
prospective assignees) any information in the possession of such
Bank from time to time concerning any Borrower; provided, that
such Bank shall require any such participant or assignee
(prospective or otherwise) to agree in writing to maintain the
confidentiality of such information; and provided, further, that
such Bank may not furnish to the participant or assignee any
information which the Borrower has identified in writing to such
Bank to be trade secrets or proprietary information.
If, pursuant to this Section 13.5, any interest in
this Agreement or any Note is transferred to any assignee which
is organized under the laws of any jurisdiction other than the
United States or any state thereof, the transferor Bank shall
cause such assignee concurrently with the effectiveness of such
transfer, (i) to represent to the transferor Bank (for the
benefit of the transferor Bank and the Company) that it is either
(x) entitled to the benefits of an income tax treaty with the
United States which provides for an exemption from United States
withholding tax on interest and other payments which may be made
by the Company to such Bank pursuant to the terms of this
Agreement or any other credit document; or (y) engaged in a trade
or business within the United States, (ii) to furnish to the
transferor Bank and the Company either U.S. Internal Revenue
Service Form 4224 or U.S. Internal Revenue Service Form 1001
(wherein such assignee claims entitlement to complete exemption
from U.S. federal withholding tax on all payments hereunder) and
(iii) to agree (for the benefit of the transferor Bank and the
Company) to provide to the transferor Bank and the Company a new
Form 4224 or Form 1001 upon the obsolescence of any previously
delivered form and comparable statements in accordance with
applicable U.S. laws and regulations and amendments duly executed
and completed by such assignee, and to comply from time to time
with all applicable U.S. laws and regulations with regard to such
withholding tax exemption.
Notwithstanding anything to the contrary in this
Section 13.5, any Bank may pledge and assign its rights hereunder
and under the Notes held by it to a Federal Reserve Bank as
collateral.
SECTION 13.6. Regulation U. Each Bank represents
that it is not relying, either directly or indirectly, upon any
margin stock (as such term is defined in Regulation U promulgated
by the Board of Governors of the Federal Reserve System) as
collateral security for the extension or maintenance by it of any
credit provided for in this Agreement.
SECTION 13.7. Confidentiality of Information. Each
Bank understands that some of the information furnished pursuant
to this Agreement or obtained by such Bank pursuant to any
inspection made in accordance with Section 8.2 may, at the time
furnished or obtained, not have been made public, and each Bank
agrees to keep confidential all such information and will make no
use of such information until it shall have become public except
in connection with this Agreement and with such Bank's outside
counsel and accountants, subject however to each Bank's
obligations under law or pursuant to subpoenas or other process
to make information available to governmental agencies and
examiners or to others.
SECTION 13.8. Limitation on Interest. No provision
of this Agreement or any Note shall require the payment or permit
the collection of interest in excess of the maximum rate
permitted by applicable law.
SECTION 13.9. Costs, Expenses and Taxes. The
Company shall pay all reasonable out-of-pocket expenses of the
Depositary Bank and the Banks (but excluding the fees and
disbursements of counsel to the Depositary Bank and the Banks) in
connection with the preparation of this Agreement and all
instruments and documents relating thereto or necessary to
satisfy the conditions to lending hereunder. The Company agrees
to pay on demand all out-of-pocket costs and expenses (including
reasonable attorneys' fees and legal expenses) incurred by each
Bank and the Depositary Bank in connection with the enforcement
of this Agreement, the Notes, any such other instruments or
documents or any collateral security. In addition, each Borrower
agrees (i) to pay, and to save the Depositary Bank and the Banks
harmless from all liability for, any stamp or other taxes which
may be payable in connection with the execution or delivery of
this Agreement, the borrowings hereunder, or the issuance of the
Notes or of any other instruments or documents provided for
herein or delivered or to be delivered hereunder or in connection
herewith and (ii) to indemnify, exonerate and hold each of the
Depositary Bank and the Banks and each of the officers,
directors, employees and agents of such Banks (herein called
collectively the "Bank Indemnitees") free and harmless from and
against any and all actions, causes of action, suits, losses,
liabilities, damages and expenses, including, without limitation,
reasonable attorneys' fees and disbursements incurred by any Bank
Indemnitee as a result of, or arising out of, or relating to any
transaction financed with proceeds of any of the Loans or the
execution, delivery, performance, enforcement or administration
of this Agreement (herein called collectively the "Indemnified
Liabilities"), except for any such Indemnified Liabilities
arising on account of any such Bank Indemnitee's negligence or
willful misconduct, and if and to the extent that the foregoing
undertaking may be unenforceable for any reason, Borrower hereby
agrees to make the maximum contribution to the payment and
satisfaction of each of the Indemnified Liabilities which is
permissible under applicable law.
SECTION 13.10. Designated Subsidiaries. (i)
Designation. The Company may at any time, and from time to time,
by delivery to the Depositary Bank of a Designation Letter duly
executed by the Company and the respective Subsidiary, designate
such Subsidiary as a "Designated Subsidiary" for purposes of this
Agreement and such Subsidiary shall thereupon become a
"Designated Subsidiary" for purposes of this Agreement. The
Depositary Bank shall promptly notify each Bank of each such
designation by the Company and the identity of the respective
Subsidiary.
(ii) Termination. Upon the payment and performance
in full of all of the Obligations of any Designated Subsidiary
then, so long as at the time no request for a Fixed Rate Loan to
such Designated Subsidiary is outstanding, such Subsidiary's
status as a "Designated Subsidiary" shall terminate upon notice
to such effect from the Company to the Depositary Bank (which
notice the Depositary Bank shall deliver to each Bank).
Thereafter, the Banks shall be under no further obligation to
make any Loan hereunder to such Designated Subsidiary.
SECTION 13.11. Captions. Captions used in this
Agreement are for convenience only and shall not affect the
construction of this Agreement.
SECTION 13.12. Governing Law; Submission to
Jurisdiction. This Agreement and each Note shall be a contract
made under and governed by the internal laws of the State of New
York. All obligations of Borrower and rights of the Banks and
any other holders of the Notes expressed herein or in the Notes
shall be in addition to and not in limitation of those provided
by applicable law. The Borrowers hereby submit 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. The Borrowers irrevocably waive, to the
fullest extent permitted by law, any objection which they 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 13.13. Counterparts. This Agreement may be
executed in any number of counterparts and by the different
parties on separate counterparts (provided, however, that each
such counterpart shall be executed by the Company) and each such
counterpart shall be deemed to be an original, but all such
counterparts shall together constitute but one and the same
Agreement.
SECTION 13.14. Effectiveness. When counterparts
executed by all the Banks shall have been lodged with the Company
and counterparts executed by the Company shall have been lodged
with each Bank this Agreement shall become effective as of
January 12, 1994.
SECTION 13.15. Successors and Assigns. This
Agreement shall be binding upon Borrower and the Banks and their
respective successors and assigns, and shall inure to the benefit
of the Borrower and the Banks and the respective successors and
assigns of the Banks, except that the Company may not assign or
transfer any of its rights or obligations under this Agreement
without the prior written consent of Banks having, in the
aggregate, a Percentage of at least 100%.
SECTION 13.16. Duties of Depositary Bank. The
Depositary Bank shall have no duties or responsibilities except
those expressly set forth in this Agreement and neither the
Depositary Bank nor any of its directors, officers, employees or
agents shall be liable or responsible for any action taken or
omitted to be taken by it or them hereunder, or in connection
herewith, except for its or their own gross negligence or willful
misconduct. In addition, the Banks agree to indemnify the
Depositary Bank, ratably in accordance with the aggregate unpaid
principal amount of the Loans made by the Banks (or, if no Loans
are at the time outstanding, ratably in accordance with their
respective Percentages), for any and all liabilities,
obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements of any kind and nature
whatsoever which may be imposed on, incurred by or asserted
against the Depositary Bank in any way relating to or arising out
of the duties and responsibilities of the Depositary Bank
expressly set forth in this Agreement; provided that (i) the
Banks shall only be liable to the extent the Borrower fails to
indemnify and pay the Depositary Bank pursuant to Section 13.9
hereof, and (ii) no Bank shall be liable for any of the foregoing
to the extent they arise from the gross negligence or willful
misconduct of the Depositary Bank.
SECTION 13.17. Severability. In case any one or
more of the provisions contained in this Agreement or the Notes
should be invalid, illegal or unenforceable in any respect, the
validity, legality and enforceability of the remaining provisions
contained herein and therein shall not in any way be affected or
impaired thereby.
SECTION 13.18. Representation of the Banks. Each
Bank represents and warrants to the Borrower that it is (x) a
United States person (as defined in Section 7701(a) (30) of the
Internal Revenue Code of 1986, as amended (the "Code")); (y)
entitled to the benefits of an income tax treaty with the United
States which provides for an exemption from United States
withholding tax on interest and other payments which may be made
by the Borrower to such Bank pursuant to the terms of this
Agreement; or (z) engaged in a trade or business within the
United States. Each Bank that is organized under the laws of any
jurisdiction other than the United States or any State thereof
(including the District of Columbia) agrees to furnish to the
Borrower, prior to the date of the first interest payment
hereunder, two copies of either U.S. Internal Revenue Service
Form 4224 or U.S. Internal Revenue Service Form 1001 (wherein
such Bank claims entitlement to complete exemption from U.S.
federal withholding tax on all payments hereunder) and to provide
to the Borrower a new Form 4224 or Form 1001 upon the
obsolescence of any previously delivered form and comparable
statements in accordance with applicable U.S. laws and
regulations and amendments duly executed and completed by such
Bank, and to comply from time to time with all applicable U.S.
laws and regulations with regard to such withholding tax
exemptions. Notwithstanding any other provisions of this
Agreement, the representations, warranties and obligations of the
Banks set forth in Section 13.5 and this Section 13.18 shall
survive the borrowing of the Loans and the assignment, sale,
repayment or other disposition of the Loans or any interest
therein.
SECTION 13.19. Survival. The obligations of the
Borrower under Sections 3.1.5, 3.1.7, 4.5 and 13.9 shall survive
the termination of this Agreement and the payment of all Loans.
SECTION 13.20. WAIVER OF TRIAL BY JURY. TO THE
EXTENT PERMITTED BY APPLICABLE LAW, THE BORROWER AND EACH OF THE
BANKS HEREBY IRREVOCABLY WAIVE ALL RIGHT OF TRIAL BY JURY IN ANY
ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR IN
CONNECTION WITH THIS AGREEMENT OR ANY MATTER ARISING HEREUNDER.
IN WITNESS WHEREOF, the Company and each Bank have
caused this Agreement to be executed, as of the day and year
first above written, by one of its officers thereunto duly
authorized.
GENERAL SIGNAL CORPORATION
By /s/ Julian B. Twombly
Vice President and Treasurer
High Ridge Park
Stamford, Connecticut 06904
Attention: Treasurer
Telecopier No.: (203) 329-4365
Amount of
Commitment
$22,222,222 THE CHASE MANHATTAN BANK, N.A.
By: /s/ Edward F. McNulty
Title: Vice President
Lending Office for Loans
The Chase Manhattan Bank, N.A.
One Chase Plaza, 17th Floor
New York, New York 10081
Attn: Edward F. McNulty
Telecopy No.: (212) 552-1457
Amount of
Commitment
$22,222,222
CHEMICAL BANK
By: /s/ Robert C. Kennedy
Title: Vice President
Lending Office for Loans
Chemical Bank
270 Park Avenue
New York, New York 10017
Attn: Robert C. Kennedy
Telecopy No: (212) 270-7138
Amount of
Commitment
$22,222,222
NATIONSBANK OF NORTH CAROLINA, N.A
By: /s/ Margaret K. Vandenberg
Title: Vice President
Lending Office for Loans
NationsBank of North Carolina, N.A.
NationsBank Plaza
Charlotte, North Carolina 28255
Attn: Lisa McClelland, NCI-002-17-21
Telecopy No: (704) 386-8694
cc: Margaret K. Vandenberg
NationsBank of North Carolina, N.A.
767 Fifth Avenue
New York, New York 10153
Telecopy No: (212) 593-1083
Amount of
Commitment
$22,222,222
WACHOVIA BANK OF GEORGIA, N.A.
By: /s/ Linda M. Harris
Title: Senior Vice President
Lending Office for Loans
Wachovia Bank of Georgia, N.A.
191 Peachtree Street, N.E.
Atlanta, Georgia 30303
Attn: Walter R. Gillikin
Telecopy No: (404) 332-6898
Amount of
Commitment
$13,888,889
CANADIAN IMPERIAL BANK OF COMMERCE
By: /s/ Brian E. O'Callahan
Title: Senior Vice President
Lending Office for Loans
Canadian Imperial Bank of Commerce
425 Lexington Avenue
New York, New York 10017
Attn: Brian E. O'Callahan
Telecopy No: (212) 856-3991
Amount of
Commitment
$13,888,889
COMMERZBANK A.G.
By: /s/ Juergen Boysen
Title: Senior Vice President
By: /s/ Christian Jagenberg
Title: Vice President
Lending Office for Loans
CommerzBank A.G.
2 World Financial Center
New York, New York 10281-1050
Attn: J.F. Christian Jagenberg
Telecopy No: (212) 266-7235
Amount of
Commitment
$13,888,889
THE FIRST NATIONAL BANK OF CHICAGO
By: /s/ James W. Petersen
Title: Vice President
Lending Office for Loans
The First National Bank of Chicago
153 West 51st Street
New York, New York 10019
Attn: James W. Peterson
Telecopy No: (212) 373-1388
Amount of
Commitment
$13,888,889
THE HONG KONG & SHANGHAI BANKING
CORPORATION
By: /s/ Jeffry S. Dykes
Title: Vice President
Lending Office for Loans
The Hong Kong & Shanghai Banking
Corporation
140 Broadway, 4th Floor
New York, New York 10015
Attn: Jeffry S. Dykes
Telecopy No: (212) 658-5109
Amount of
Commitment
$13,888,889
NATIONAL WESTMINSTER BANK Plc
By: /s/ Anthony G. Muller
Title: Vice President
Lending Office for Loans
National Westminster Bank Plc
Corporate and Institutional Finance
175 Water Street
New York, New York 10038-4924
Attn: Anthony G. Muller
Telecopy No: (212) 602-4500
Amount of
Commitment
$13,888,889
THE NORTHERN TRUST COMPANY
By: /s/ Gregory Werd
Title: Vice President
Lending Office for Loans
The Northern Trust Company
50 South LaSalle Street
Chicago, Illinois 60675
Attn: Gregory F. Werd, Jr.
Telecopy No: (312) 444-3508
Amount of
Commitment
$13,888,889
THE SANWA BANK LIMITED
By: /s/ Stephen C. Small
Title: Vice President
Lending Office for Loans
The Sanwa Bank Limited
New York Branch
Park Avenue Plaza
55 East 52nd Street
New York, New York 10055
Attn: Stephen C. Small
Telecopy No: (212) 754-1304
Amount of
Commitment
$13,888,889
SHAWMUT BANK
By: /s/ John F. Wood
Title: Senior Vice President
Lending Office for Loans
Shawmut Bank
777 Main Street
MSN 203
Hartford, Connecticut 06115
Attn: Christopher Mango
Telecopy No: (203) 722-9378
EXHIBIT A
REVOLVING NOTE
$ , 199
The undersigned, for value received, promises to pay to
the order of
on
or before the Revolver Expiration Date, as defined in the Four
Year Credit Agreement referred to below, the principal sum of
Dollars or, if less, the aggregate
unpaid principal amount of all Revolving Loans made by the payee
to the undersigned pursuant to the Four Year Credit Agreement (as
hereinafter defined) as shown on the schedule attached hereto
(and any continuation thereof), together, from time to time, with
interest on the unpaid principal amount hereof from time to time
outstanding as provided in Article III of the Four Year Credit
Agreement hereinafter referred to (but in no event higher than
the maximum rate permitted by applicable law).
Payments of both principal and interest are to be made
in lawful money of the United States of America for the account
of the payee at the office of The Chase Manhattan Bank, N.A., at
One Chase Manhattan Plaza, New York, New York 10081 in
immediately available funds.
This Note evidences indebtedness incurred under, and is
subject to the terms and provisions of, a Four Year Credit
Agreement dated as of January 12, 1994, (and, all further
amendments thereto, if any) among the undersigned and certain
banks (including the payee) to which Four Year Credit Agreement
reference is hereby made for a statement of said terms and
provisions, including those under which this Note may be paid, or
may be declared to be due and payable, prior to its due date.
This Note is made under and governed by the internal
laws of the State of New York.
[BORROWER]
By
Title
Schedule Attached to Revolving Note dated , 199 of
[Borrower] payable to the order of
LOANS AND PRINCIPAL PAYMENTS
Beginning
and End
Eurodollar
or CD Amount of Unpaid
Amount of Interest Principal Principal Notation
Date Loan Made Period Repaid Balance Made By
EXHIBIT B
TERM NOTE
$ , 199
The undersigned, for value received, promises to pay to
the order of
the
principal sum of
Dollars
payable on January 11, 1998 together, from time to time, with
interest on the unpaid principal amount hereof from time to time
outstanding as provided in Article III of the Four Year Credit
Agreement hereinafter referred to (but in no event higher than
the maximum rate permitted by law).
Payments of both principal and interest are to be made
in lawful money of the United States of America for the account
of the payee at the office of The Chase Manhattan Bank, N.A., at
One Chase Manhattan Plaza, New York, New York 10081 in
immediately available funds.
This Note evidences indebtedness incurred under, and is
subject to the terms and provisions of, a Four Year Credit
Agreement dated as of January 12, 1994, (and, all further
amendments thereto, if any) among the undersigned and certain
banks (including the payee), to which Four Year Credit Agreement
reference is hereby made for a statement of said terms and
provisions, including those under which this Note may be paid, or
may be declared to be due and payable, prior to its due date.
This Note is made under and governed by the internal
laws of the State of New York.
[BORROWER]
By
Title
EXHIBIT C
Market Rate Promissory Note
$ , 199
The undersigned, for value received, promises to pay to
the order of
on
or before the Revolver Expiration Date, as defined in the Four
Year Credit Agreement referred to below, the principal sum of
Dollars or the equivalent in any
Alternate Currency shown on the schedule attached hereto or, if
less, the aggregate unpaid principal amount of all Market Rate
Loans made by the payee to the undersigned pursuant to the Four
Year Credit Agreement (as hereinafter defined) as shown on the
schedule attached hereto (and any continuation thereof),
together, from time to time, with interest on the unpaid
principal amount hereof from time to time outstanding as provided
in Article III of the Four Year Credit Agreement hereinafter
referred to (but in no event higher than the maximum rate
permitted by applicable law).
Payments of both principal and interest are to be made
in lawful money of the United States of America or an Alternate
Currency if so specified with respect to any Market Rate Loan on
the schedule attached hereto in immediately available funds to,
in the case of loans in Dollars the account specified by the
payee and, in the case of Alternate Currency Loans, the Alternate
Currency Payment Office.
This Note evidences indebtedness incurred under, and is
subject to the terms and provisions of, a Four Year Credit
Agreement dated as of January 12, 1994, (and, all further
amendments thereto, if any) among the undersigned and certain
banks (including the payee) to which Four Year Credit Agreement
reference is hereby made for a statement of said terms and
provisions, including those under which this Note may be paid, or
may be declared to be due and payable, prior to its due date.
This Note is made under and governed by the internal
laws of the State of New York.
[BORROWER]
By
Title
SCHEDULE ATTACHED TO MARKET RATE PROMISSORY NOTE
DATED AS OF FROM
[BORROWER] TO
____________________
ALTERNATE AMOUNT OF UNPAID
AMOUNT CURRENCY MATURITY PRINCIPAL PRINCIPAL
DATE OF LOAN (if applicable) DATE RATE REPAID BALANCE
EXHIBIT D
FORM OF ATTORNEY'S OPINION OF COUNSEL TO BORROWER
Per Section 9.1.5
[Letterhead of Messrs. Cahill Gordon & Reindel]
Each of the Commercial Banking Institutions
listed on Schedule I hereto
Re: General Signal Corporation Four Year Credit
Agreement, Dated as of January 12, 1994
Gentlemen:
We have acted as counsel to General Signal
Corporation, a New York corporation (the "Company"), in
connection with the Four Year Credit Agreement, dated as of
January 12, 1994 ("Agreement"), between you and the Company,
covering loans by you to Borrower to be evidenced by the Notes.
Capitalized terms used herein and not otherwise defined herein
shall have the meanings assigned to them in the Four Year
Credit Agreement.
We have examined originals, photocopies or conformed
copies of such records of the Company and its subsidiaries and
such agreements, certificates of public officials, certificates
of officers and representatives of the Company and its
subsidiaries and such other documents as we have deemed
relevant and necessary as a basis for the opinions hereinafter
expressed. In such examinations, we have assumed the
genuineness of all signatures on original documents and the
conformity to the originals of all copies submitted to us as
conformed or photocopies. As to various questions of fact
material to the opinions expressed herein, we have relied upon
representations, statements or certificates of public
officials, officers and representatives of the Company and its
subsidiaries and others.
We are of the opinion that:
(1) The Company is a corporation duly organized,
validly existing and in good standing under the laws of
the State of New York and in good standing in the State of
Connecticut.
(2) The execution, delivery and performance of the
Agreement and the Notes, and the borrowings by the Company
pursuant thereto, are within the Company's corporate
powers and have been duly authorized by all necessary
corporate action.
(3) No governmental approval of the actions referred
to in (2) above is required.
(4) The actions referred to in (2) above do not
contravene or conflict with any provision of law, the
Articles of Incorporation or By-laws of the Company, or
any material agreement, indenture or instrument which is
binding on or applicable to the Company of which we have
knowledge.
(5) The Agreement is, and each of the Notes, when
executed and delivered for the consideration as
contemplated by the Agreement will be, the legally valid
and binding obligation of the Company, enforceable against
Borrower in accordance with their respective terms, except
that (i) such enforceability may be limited by generally
applicable bankruptcy, insolvency, moratorium, fraudulent
transfer or conveyance or other similar laws affecting the
enforcement of creditors' rights generally and (ii) no
opinion has been requested or is being rendered as to the
availability of equitable remedies, such as, for example,
specific performance or injunctive relief, which are
within the discretion of courts of applicable
jurisdiction.
(6) The Company is not (i) an "investment company,"
or a company "controlled" by an "investment company,"
within the meaning of the Investment Company Act of 1940,
as amended, or (ii) a public utility or a public utility
holding company as defined in the Public Utility Holding
Company Act of 1935.
Our opinion in (4) above is based, in part, upon the
accuracy of the representations contained in Section 13.6 of
the Agreement.
We are members of the Bar of the State of New York
and we express no opinion herein with respect to any law other
than the laws of the State of New York and the federal law of
the United States.
Very truly yours,
EXHIBIT E
FORM OF DESIGNATION LETTER
, 199
To each of the Banks party to the
Four Year Credit Agreement (as defined below)
Ladies and Gentlemen:
Reference is made to the Credit Agreement dated as of
January 12, 1994, among General Signal Corporation (the
"Company") and the Banks named therein (the "Credit
Agreement"). Terms used herein and defined in the Credit
Agreement shall have the respective meanings ascribed to such
terms in the Credit Agreement.
Please be advised that the Company hereby designates
its undersigned Subsidiary, ("Designated
Subsidiary"), as a "Designated Subsidiary" under and for all
purposes of the Credit Agreement.
The Designated Subsidiary, in consideration of each
Bank's agreement to extend credit to it under and on the terms
and conditions set forth in the Credit Agreement, does hereby
assume each of the obligations imposed upon a "Designated
Subsidiary" and a "Borrower" under the Credit Agreement and
agrees to be bound by the terms and conditions of the Credit
Agreement. In furtherance of the foregoing, the Designated
Subsidiary hereby represents and warrants to each Bank as
follows:
1. The Designated Subsidiary is a corporation duly
incorporated, validly existing and in good standing under
the laws of .
2. The delivery of this Designation Letter, the
borrowings under the Credit Agreement, the execution and
delivery of the Notes, and the performance by the
Designated Subsidiary of its obligations under the Credit
Agreement, the Designation Letter and the Notes, are
within the Borrower's corporate powers, have been duly
authorized by all necessary corporate action, have
received all necessary governmental approval (if any shall
be required), and do not and will not violate, contravene
or conflict in any material respect with any provision of
law or of the charter or by-laws of the Designated
Subsidiary or of any judgment or any material agreement or
indenture binding upon or applicable to the Designated
Subsidiary the contravention of or conflict with which
would materially adversely affect the consolidated
financial condition or continued operations of the
Designated Subsidiary as a whole or materially impair the
ability of the Designated Subsidiary to perform any of its
obligations hereunder.
This Designation Letter and the Credit Agreement, and
the Notes when duly executed and delivered by the
Designated Subsidiary will be, legal, valid and binding
obligations of the Designated Subsidiary enforceable
against it in accordance with their respective terms,
subject only to bankruptcy, insolvency, reorganization,
moratorium or similar laws affecting the enforceability of
rights of creditors generally.
3. No litigation or arbitration proceedings are
pending or, to the knowledge of the Designated Subsidiary,
threatened against the Designated Subsidiary as to which
there is a reasonable likelihood of an adverse
determination and which would reasonably be expected to
have a material adverse effect on the ability of the
Designated Subsidiary to pay its debts (including the
Loans made to it under the Credit Agreement) as the same
become due and payable.
4. No authorizations, consents, approvals,
licenses, filings or registrations by or with any
governmental authority or administrative body are required
in connection with the execution, delivery or performance
by the Designated Subsidiary of this Designation Letter
and the Credit Agreement except for such authorizations,
consents, approvals, licenses, filings or registrations as
have heretofore been made, obtained or effected and are in
full force and effect.
5. The Designated Subsidiary is not, and
immediately after the application by the Designated
Subsidiary of the proceeds of each Loan will not be,
(a) an "investment company" within the meaning of the
Investment Company Act of 1940, as amended, or (b) a
"holding company" within the meaning of the Public Utility
Holding Company Act of 1935, as amended.
Very truly yours,
GENERAL SIGNAL CORPORATION [THE DESIGNATED SUBSIDIARY]
By________________________ By_________________________
Title: Title:
EXHIBIT F
FORM OF ATTORNEY'S OPINION OF
COUNSEL TO A DESIGNATED SUBSIDIARY
Each of the Commercial Banking Institutions
listed on Schedule I hereto
Re: General Signal Corporation Four Year Credit
Agreement Dated as of January 12, 1994
Gentlemen:
We have acted as counsel to [Designated Subsidiary],
a corporation (the "Designated
Subsidiary"), in connection with the Four Year Credit
Agreement, dated as of January 12, 1994 ("Agreement"),
betweenbppppppppa you and the Company, covering loans by you to
Borrower to be evidenced by the Notes. Capitalized terms used
herein and not otherwise defined herein shall have the meanings
assigned to them in the Agreement.
We have examined originals, photocopies or conformed
copies of such records of the Designated Subsidiary and such
agreements, certificates of public officials, certificates of
officers and representatives of the Designated Subsidiary and
its subsidiaries and such other documents as we have deemed
relevant and necessary as a basis for the opinions hereinafter
expressed. In such examinations, we have assumed the
genuineness of all signatures on original documents and the
conformity to the originals of all copies submitted to us as
conformed or photocopies. As to various questions of fact
material to the opinions expressed herein, we have relied upon
representations, statements or certificates of public
officials, officers and representatives of the Designated
Subsidiary and others.
We are of the opinion that:
(1) The Designated Subsidiary is a corporation duly
organized, validly existing and in good standing under the
laws of .
(2) The execution, delivery and performance by the
Designated Subsidiary of the Designation Letter, and the
Notes to be executed by the Designated Subsidiary, and the
borrowings by the Designated Subsidiary pursuant thereto,
are within the Designated Subsidiary's corporate powers
and have been duly authorized by all necessary corporate
action.
(3) No governmental approval of the action referred
to in (2) above is required.
(4) The actions referred to in (2) above to not
contravene or conflict with any provision of law, the
Charter or By-laws of the Designated Subsidiary, or any
material agreement, indenture or instrument which is
binding on or applicable to the Designated Subsidiary of
which we have knowledge.
(5) The Designation Letter is, and each of the Notes
to be executed by the Designated Subsidiary, when executed
and delivered for the consideration as contemplated by the
Agreement will be, the legally valid and binding
obligation of the Designated Subsidiary, enforceable
against Borrower in accordance with their respective
terms, except that (i) such enforceability may be limited
by generally applicable bankruptcy, insolvency,
moratorium, fraudulent transfer or conveyance or other
similar laws affecting the enforcement of creditors'
rights generally and (ii) no opinion has been requested or
is being rendered as to the availability of equitable
remedies, such as, for example, specific performance or
injunctive relief, which are within the discretion of
courts of applicable jurisdiction.
(6) The Company is not (i) an "investment company,"
or a company "controlled" by an "investment company,"
within the meaning of the Investment Company Act of 1940,
as amended, or (ii) a public utility or a public utility
holding company has defined in the Public Utility Holding
Company Act of 1935.
Our opinion in (4) above is based, in part, upon the
accuracy of the representations contained in Section 13.6 of
the agreement.
Very truly yours,
File: 4.73.2
forms\defcomp.doc
GENERAL SIGNAL CORPORATION
DEFERRED COMPENSATION PLAN
As Established
October 14, 1993
101493
GENERAL SIGNAL CORPORATION
DEFERRED COMPENSATION PLAN
TABLE OF CONTENTS
PAGE
ARTICLE I Purpose . . . . . . . . . . . . . . I-1
ARTICLE II Definitions . . . . . . . . . . . .II-1
ARTICLE III Eligibility . . . . . . . . . . . III-1
ARTICLE IV Savings Account Allocations . . . .IV-1
ARTICLE V Incentive Account Allocations . . . V-1
ARTICLE VI Phantom Stock Units and Fixed Income BalancesVI-1
ARTICLE VII Vesting . . . . . . . . . . . . . VII-1
ARTICLE VIII Distributions and Withdrawals . .VIII-1
ARTICLE IX Source of Payment of Benefits . . .IX-1
ARTICLE X Designation of Beneficiaries. . . . X-1
ARTICLE XI Administration of the Plan. . . . .XI-1
ARTICLE XII Amendment and Termination . . . . XII-1
ARTICLE XIII General Provisions. . . . . . . .XIII-1
GENERAL SIGNAL CORPORATION
DEFERRED COMPENSATION PLAN
ARTICLE I
Purpose
1.1 General Signal Corporation established this Deferred
Compensation Plan effective as of October 14, 1993 for the purposes of
providing to its eligible employees (a) benefits which would have been payable
from the tax-exempt trust under the tax-qualified benefit plan known as the
General Signal Corporation Savings and Stock Ownership Plan but for the
limitations placed by the Internal Revenue Code on contributions with respect
to such employees under such plan and (b) an opportunity to defer all or a
portion of their incentive compensation awards and to receive in lieu thereof
phantom stock units.
The portions of the Plan providing (a) benefits without regard to
the limitation on "compensation" under Section 401(a)(17) of the Code
($150,000 for 1994), the limitation applicable to the Savings Plan under
Section 402(g) of the Code ($8,994 for 1993) and the limitations on
contributions under the Savings Plan by reason of the actual deferral
percentage test of Section 401(k) of the Code and the average contribution
percentage test of Section 401(m) of the Code and (b) an opportunity to defer
all or a portion of the incentive compensation award, constitute an unfunded
plan maintained primarily for the purpose of providing deferred compensation
for a select group of management or highly compensated employees. The portion
of the Plan providing benefits above the limitations prescribed under Section
415 of the Code constitutes an "excess benefit plan" as defined in Section
3(36) of the Employee Retirement Income Security Act of 1974.
ARTICLE II
Definitions
When used herein, the following terms shall have the following meanings:
2.1 "Account" means an Employee's Savings Account or Incentive
Account under the Plan.
2.2 "Act" means the Employee Retirement Income Security Act of 1974
as amended from time to time.
2.3 "Beneficiary" means the beneficiary or beneficiaries designated
in accordance with Article X of the Plan to receive the amount, if any,
payable upon the death of an Employee who participates in the Plan.
2.4 "Benefit Limitations" means (a) the maximum aggregate amount of
"annual additions" which could have been made to an Employee's accounts under
the Savings Plan in accordance with Section 415 of the Code, (b) the
limitation prescribed under Section 401(a)(17) of the Code on the amount of
annual compensation that can be taken into account under the Savings Plan, (c)
the limitation applicable to the Savings Plan under Section 402(g) of the
Code, (d) the limitations applicable to highly compensated employees under the
Savings Plan with regard to the contribution rates for Tax Deferred
Contributions, in order to comply with the actual deferral percentage test
under Section 401(k) of the Code, and (e) the limitations applicable to highly
compensated employees under the Savings Plan with regard to Matching
Contributions by reason of the average contribution percentage test under
Section 401(m) of the Code.
2.5 "Board of Directors" means the Board of Directors of the
Company.
2.6 "Code" means the Internal Revenue Code, as amended from time to
time.
2.7 "Committee" means the Personnel and Compensation Committee of
the Board of Directors of the Company.
2.8 "Company" means General Signal Corporation , a New York
corporation, and its successors or assigns.
2.9 "Company Stock" means the Common Stock, par value of $1.00 per
share, of the Company.
2.10 "Compensation" means Compensation as defined in the Savings
Plan but determined without regard to the limitation prescribed under Section
401(a)(17) of the Code on the amount of annual compensation that can be taken
into account under the Savings Plan.
2.11 "Disability" means long term disability as determined under
rules and procedures that apply under the Company's Long Term Disability Plan.
2.12 "Employee" means any executive officer of the Company and any
President of a unit of the Company.
2.13 "Employer" means the Company and each subsidiary thereof that
participates in the Corporate Retirement Plan or the Savings Plan or both.
2.14 "Employment Requirement" means the requirement under the
Savings Plan that an employee complete a year of Continuous Employment in
order to receive Matching Contributions.
2.15 "Fixed Income Balance" means an Employee's Fixed Income Balance
in his Savings Account determined pursuant to Section 6.2.
2.16 "Investment Account" means an Employee's Account attributable
to allocations pursuant to Sections 5.1 and 5.2 as adjusted for dividend
equivalents and earnings equivalents pursuant to Article VI.
2.17 "Matching Contribution" means a Matching Contribution as
defined in the Savings Plan.
2.18 "Phantom Stock Unit" means a unit in an Account corresponding
to a share of Company Stock as described in Section 6.1.
2.19 "Plan" means the General Signal Corporation Deferred
Compensation Plan as set forth herein and as amended and restated from time to
time.
2.20 "Savings Account" means an Employee's Account attributable to
allocations pursuant to Sections 4.1 and 4.2 as adjusted for dividend
equivalents and earnings equivalents pursuant to Article VI.
2.21 "Savings Plan" means the General Signal Corporation Savings and
Stock Ownership Plan, as amended and restated from time to time.
2.22 "Tax Deferred Contribution" means a Tax Deferred Contribution
as defined in the Savings Plan.
2.23 "Value" means, with respect to a share of Company Stock, the
closing price on the New York Stock Exchange - Composite Transactions on the
business day coincident with or immediately preceding the date as of which the
determination is made.
ARTICLE III
Eligibility
3.1 Each Employee with respect to whom allocations of Tax Deferred
Contributions or Matching Contributions are reduced under the Savings Plan as
a result of the Benefit Limitations or who receives an incentive compensation
award shall be eligible to participate in the Plan.
ARTICLE IV
Savings Account Allocations
4.1 Each Employee who has made the maximum Tax Deferred
Contributions permitted under the Savings Plan and who is prevented from
making additional Tax Deferred Contributions to the Savings Plan by reason of
the Benefit Limitations may elect (a) to reduce his Compensation (to the
extent not otherwise reduced under Section 5.1) by an amount designated by the
Employee but not in excess of the difference, if any, between (i) the maximum
Tax Deferred Contributions that could have been made under the Savings Plan on
behalf of the Employee without regard to the Benefit Limitations, and (ii) the
maximum Tax Deferred Contributions actually made to the Savings Plan on behalf
of the Employee, and (b) to have such amount credited to his Savings Account
under the Plan. With respect to the period October 1, 1993 through December
31, 1993, any such election shall be in writing and irrevocable and must be
made by November 15, 1993, in which event the Compensation reductions shall be
made entirely from Compensation earned in December of 1993. With respect to
succeeding calendar quarters, any such election shall be in writing and must
be made no later than 15 days prior to the beginning of the calendar quarter
in which the Compensation is to be earned and may not be revoked or changed
thereafter except as to Compensation to be earned in subsequent calendar
quarters (subject to the same requirement of an irrevocable election at least
15 days prior to the beginning of the calendar quarter). Allocations pursuant
to this Section 4.1 shall be credited to the Savings Account as of the last
business day of the month in which the Compensation would otherwise have been
paid.
4.2 With respect to each Employee, there shall be credited to the
Employee's Savings Account under the Plan the sum of (a) the additional
Matching Contributions that would have been allocated to the Employee's
account under the Savings Plan to match actual contributions made to the
Savings Plan if the Benefit Limitations were not applicable, and (b) if the
Employee elects to reduce his Compensation pursuant to Section 4.1, the
Matching Contributions that would have been made to the Employee's account
under the Savings Plan if the amounts allocated to his Savings Account
pursuant to Section 4.1 were Tax Deferred Contributions to the Savings Plan
and the Benefit Limitations and the Employment Requirement did not apply.
Allocations pursuant to this Section 4.2 shall be credited to the Savings
Account as of the last business day of the month in which the related
Compensation would otherwise have been paid.
ARTICLE V
Incentive Account Allocations
5.1 Each Employee who is eligible for an incentive compensation
award may elect to reduce such award by a percentage designated by the
Employee (in 5% increments up to 100%), and to have such amount credited to
his Incentive Account under the Plan. Any such election shall be in writing
and must be made by December 31 of the year prior to the scheduled payment of
such award and may not be revoked or changed thereafter except as to awards
scheduled for payment in future years (subject to the same requirement of an
irrevocable election by December 31 of the year prior to the scheduled
payment). Allocations pursuant to this Section 5.1 shall be credited to the
Incentive Account as of the date on which the award would otherwise have been
paid.
5.2 With respect to each Employee who elects to reduce his incentive
compensation award pursuant to Section 5.1, an additional allocation shall be
credited to his Incentive Account in an amount equal to 10% of the amount
credited to his Incentive Account pursuant to Section 5.1. Allocations
pursuant to this Section 5.2 shall be credited to the Incentive Account as of
the same date as the related allocation under Section 5.1.
ARTICLE VI
Phantom Stock Units and Fixed Income Balances
6.1 Any amounts credited to an Employee's Savings Account pursuant
to Section 4.1 or 4.2 or to an Employee's Incentive Account pursuant to
Section 5.1 or 5.2 shall be converted into a number of Phantom Stock Units
determined by dividing such amount by the Value of a share of Company Stock on
the date such amount is so credited. If any cash dividends are paid on shares
of Company Stock while Phantom Stock Units are held in the Employee's Savings
Account or Incentive Account, there shall be credited to such Employee's
Savings Account or Incentive Account, as the case may be, an additional number
of Phantom Stock Units determined by dividing (a) the amount of the dividends
that he would have received if he held the number of shares of Company Stock
equal to the number of Phantom Stock Units held in the Account immediately
before the dividend is declared, by (b) the Value of a share of Company Stock
on the date the dividend is declared. Such credit shall be made as of the
date on which the dividend is declared.
If any dividends on shares of Company Stock are paid in the form of
Company Stock while Phantom Stock Units are held in an Employee's Savings
Account or Incentive Account, there shall be credited to such Employee's
Savings Account or Incentive Account, as the case may be, an additional number
of Phantom Stock Units equal to the number of shares of Company Stock he would
have received as a dividend if he held the number of shares of Company Stock
equal to the number of Phantom Stock Units held in the applicable Account
immediately before the dividend is declared. Such credit shall be made as of
the date on which the dividend is declared.
In the event of a stock split, combination of shares,
recapitalization, reorganization, merger, consolidation, rights offering, or
any other change in the corporate structure or shares of the Company, the
Committee shall make such adjustments, if any, as it deems appropriate in the
number of Phantom Stock Units and the shares to which they correspond.
6.2 An Employee who has attained age 62 may elect to convert any or
all of the Phantom Stock Units in his Savings Account (but not in his
Incentive Account) into a Fixed Income Balance as of the last day of any
calendar quarter on 15 days' written notice to the Company. In the event that
an Employee makes such an election, the number of Phantom Stock Units in his
Savings Account shall be reduced in accordance with his election, and his
Fixed Income Balance shall initially be (or, in the case of subsequent
conversions, shall be increased by) an amount equal to the product of the
number of Phantom Stock Units so converted and the Value of a share of Company
Stock on the last day of the calendar quarter as of which the conversion takes
place. Thereafter, the Fixed Income Balance shall be adjusted at the end of
each calendar quarter in the same manner as if such balance had been invested
in the Fixed Income Fund under the Savings Plan. <PAGE>
6.3 An Employee's Savings
Account and Incentive Account shall be bookkeeping accounts maintained by the
Company.
ARTICLE VII
Vesting
7.1 An Employee shall at all times be 100% vested in the Phantom
Stock Units and the portion of the Fixed Income Balance attributable to
allocations credited to his Savings Account pursuant to Section 4.1 (including
Phantom Stock Units and the portion of the Fixed Income Balance attributable
to dividend equivalents [as described in Section 6.1] and earnings equivalents
[as described in Section 6.2] resulting from such allocations).
7.2 An Employee's rights to the Phantom Stock Units attributable to
allocations made pursuant to Sections 4.2, 5.1 or 5.2 (including any Phantom
Stock Units resulting from dividend equivalents [as described in Section 6.1]
on those Phantom Stock Units) and the portion of the Employee's Fixed Income
Balance attributable to allocations made pursuant to Section 4.2 (including
any earnings equivalents [as described in Section 6.2] on such portion), shall
become nonforfeitable on the first to occur of:
(a) the date 12 months after each such allocation is credited under
Sections 4.2, 5.1 or 5.2 to an Employee's Account,
(b) the Employee's death, or
(c) the Employee's Disability.
7.3 Upon the termination of an Employee's employment for any reason,
other than death or Disability, such Employee shall forfeit the nonvested
portion of his Savings Account and of his Incentive Account.
ARTICLE VIII
Distributions and Withdrawals
8.1 At the time of filing an election to reduce Compensation
pursuant to Section 4.1 or to reduce any portion of an incentive compensation
award pursuant to Section 5.1, an Employee shall also irrevocably elect the
payment date for any Phantom Stock Units and Fixed Income Balance attributable
to the allocations made to his Savings Account pursuant to Sections 4.1 and
4.2 or attributable to the allocations made to his Incentive Account pursuant
to Sections 5.1 and 5.2, as the case may be, as a result of such election,
including any Phantom Stock Units or Fixed Income Balance resulting from
dividend equivalents (as described in Section 6.1) and earnings equivalents
(as described in Section 6.2) on such Phantom Stock Units and Fixed Income
Balance. Such election may be changed with respect to future allocations
pursuant to Sections 4.1 and 4.2 in accordance with the election procedures
set forth in Section 4.1 and with respect to future allocations pursuant to
Sections 5.1 and 5.2 in accordance with the election procedures set forth in
Section 5.1 (subject in each case to the same limitations on the right to
revoke or change such election). The payment date elected by the Employee may
be either (a) a specified date no less than five years after the date of the
election or (b) the date of the Employee's Disability, death, retirement or
other termination of employment.
8.2 Payment of any Phantom Stock Units and Fixed Income Balance
shall be made in the form described in Section 8.3 as soon as administratively
practicable after the earlier of (a) the applicable payment date elected by
the Employee for such Phantom Stock Units and Fixed Income Balance, or (b) the
date of the Employee's Disability, death, retirement or other termination of
employment.
8.3 Except as hereinafter provided, payment shall be made in a cash
lump sum on the date determined pursuant to Section 8.2 in an amount equal to
the sum of (a) the number of vested Phantom Stock Units multiplied by the
Value of a share of Common Stock on the earlier of the dates specified in
Section 8.2(a) or (b), and (b) the value of the vested Fixed Income Balance as
of the last day of the calendar quarter next preceding the earlier of the
dates specified in Section 8.2(a) or (b).
Anything herein to the contrary notwithstanding, the Committee
reserves the right (a) to designate a form of payment other than a lump sum
payment or (b) to limit payments in any given year to such amount as would not
cause a loss of deductibility pursuant to Section 162(m) of the Code.
8.4 Distributions or withdrawals from an Employee's Savings Account
or Incentive Account shall not be permitted prior to the date of distribution
pursuant to Section 8.2, except that a withdrawal may be made from an
Employee's Savings Account (but not his Incentive Account) by reason of an
unforeseeable emergency. For this purpose, an unforeseeable emergency shall
be an unanticipated emergency that is caused by an event beyond the control of
the Employee and that would result in severe financial hardship if early
withdrawal were not permitted. Any early withdrawal approved by the Committee
pursuant to this Section 8.4 shall be limited to the amount necessary to meet
the emergency.
ARTICLE IX
Source of Payment of Benefits
9.1 All payments provided for under the Plan shall be paid in cash
from the general funds of the Company; provided, however, that such payments
shall be reduced by the amount of any payments made to the Employee or his or
her dependents, beneficiaries or estate from any trust or special or separate
fund established by the Company to assure such payments. The Company shall
not be required to establish a special or separate fund or other segregation
of assets to assure such payments, and, if the Company shall make any
investments to aid it in meeting its obligations hereunder, a participant
shall have no right, title, or interest whatever in or to any such investments
except as may otherwise be expressly provided in a separate written instrument
relating to such investments. Nothing contained in this Plan, and no action
taken pursuant to its provisions, shall create or be construed to create a
trust of any kind between the Company and any participants. To the extent
that any participant acquires a right to receive payments from the Company
hereunder, such right shall be no greater than the right of an unsecured
creditor of the Company.
9.2 The Company may, for administrative reasons, establish a grantor
trust for the benefit of participants in the Plan. The assets of said trust
will be held separate and apart from other Company funds and shall be used
exclusively for the purposes set forth in the Plan and the applicable trust
agreement, subject to the following conditions:
(a) the creation of said trust shall not cause the Plan to be other
than "unfunded" for purposes of Title I of the Act;
(b) the Company shall be treated as the "grantor" of said trust for
purposes of Sections 671 and 677 of the Code; and
(c) said trust agreement shall provide that its assets may be used
to satisfy claims of the Company's general creditors, provided that the rights
of such general creditors are enforceable under federal and state law.
ARTICLE X
Designation of Beneficiaries
10.1 Unless an Employee who participates in the Plan otherwise files
with the Company a written designation of one or more persons as the
Beneficiary who shall be entitled to receive the amount, if any, payable under
the Plan upon his death, the Employee's beneficiary under the Savings Plan
shall be deemed to have been designated his Beneficiary for benefits. If the
Committee is in doubt as to the right of any person to receive such amount,
the Company may retain such amount, without liability for any interest
thereon, until the rights thereto are determined, or the Company may pay such
amount into any court of appropriate jurisdiction, and such payment shall be a
complete discharge of the liability of the Plan and the Company therefor.
ARTICLE XI
Administration of the Plan
11.1 The Plan shall be administered by the Committee, which shall
have full power and authority to interpret, construe and administer the Plan,
and review claims for benefits under the Plan, and the Committee's
interpretations and constructions of the Plan and actions thereunder shall be
binding and conclusive on all persons and for all purposes.
11.2 If any claim for benefits under the Plan is wholly or partially
denied, the Committee shall give written notice by registered or certified
mail of such denial to the claimant within 90 days after receipt of the
written claim by the Committee. Notice must be written in a manner calculated
to be understood by the claimant, setting forth the specific reasons for such
denial, specific reference to pertinent Plan provisions on which the denial is
based, a description of any additional material or information necessary for
the claimant to perfect the claim and an explanation of why such material or
information is necessary, and an explanation of the Plan's claim review
procedure. The Committee shall also advise the claimant that he or his duly
authorized representative may request a review by the Committee of the
decision to deny the claim by filing with the Committee, within 65 days after
such notice has been received by the claimant, a written request for such
review. The claimant may review pertinent documents and submit issues and
comments in writing within the same 65 day period. If such request is so
filed, such review shall be made by the Committee with 60 days after receipt
of such request, unless special circumstances (including, but not limited to,
a need to hold a hearing) require an extension of time for processing, in
which case a decision shall be rendered not later than 120 days after receipt
of the request for review. The claimant shall be given written notice within
such 60 day period of the decision resulting from such review, which 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 was based.
ARTICLE XII
Amendment and Termination
12.1 The Plan may be amended, suspended or terminated, in whole or
in part, by the Board of Directors, but no such action shall retroactively
impair or otherwise adversely affect the rights of any person to benefits
under the Plan which have accrued prior to the date of such action, as
determined by the Committee.
ARTICLE XIII
General Provisions
13.1 This Plan shall be binding upon and inure to the benefit of the
Company and its successors and assigns and the Employee, his designees and his
estate. Nothing in this Plan shall preclude the Company from consolidating or
merging into or with, or transferring all or substantially all of its assets
to, another corporation which assumes this Plan and all obligations of the
Company hereunder. Upon such a consolidation, merger or transfer of assets
and assumption, the term "Company" shall refer to such other corporation and
this Plan shall continue in full force and effect.
13.2 Neither the Plan nor any action taken hereunder shall be
construed as giving to an Employee the right to be retained in the employ of
the Employer or as affecting the right of the Employer to dismiss any
Employee.
13.3 The Company may withhold from any benefits payable under this
Plan all Federal, state, city or other taxes as shall be required pursuant to
any law or governmental regulation or ruling.
13.4 Except insofar as may otherwise be required by law, no amount
payable at any time under the Plan shall be subject in any manner to
alienation by anticipation, sale, transfer, assignment, bankruptcy, pledge,
attachment, charge or encumbrance of any kind nor in any manner be subject to
the debts or liabilities of any person and any attempt to so alienate or
subject any such amount, whether presently or thereafter payable, shall be
void. If any person shall attempt to, or shall alienate, sell, transfer,
assign, pledge, attach, charge or otherwise encumber any amount payable under
the Plan, or any part thereof, or if by reason of his bankruptcy or other
event happening at any such time such amount would be made subject to his
debts or liabilities or would otherwise not be enjoyed by him, then the
Committee, if it so elects, may direct that such amount be withheld and that
the same or any part thereof be paid or applied to or for the benefit of such
person, his spouse, children or other dependents, or any of them, in such
manner and proportion as the Committee may deem proper.
13.5 If the Committee shall find that any person to whom any amount
is or was payable hereunder is unable to care for his affairs because of
illness or accident, or has died, then the Committee, if it so elects, may
direct that any payment due him or his estate (unless a prior claim therefor
has been made by a duly appointed legal representative) or any part thereof be
paid or applied for the benefit of such person or to or for the benefit of his
spouse, children or other dependents, an institution maintaining or having
custody of such person, any other person deemed by the Committee to be a
proper recipient on behalf of such person otherwise entitled to payment, or
any of them, in such manner and proportion as the Committee may deem proper.
Any such payment shall be in complete discharge of the liability of the
Company therefor. <PAGE>
13.6 All elections, designations, requests, notices,
instructions, and other communications from an Employee, Beneficiary or other
person to the Committee required or permitted under the Plan shall be in such
form as is prescribed from time to time by the Committee, shall be mailed by
first-class mail or delivered to such location as shall be specified by the
Committee, and shall be deemed to have been given and delivered only upon
actual receipt thereof at such location.
13.7 The benefits payable under this Plan shall be in addition to
all other benefits provided for Employees of the Company.
13.8 The captions preceding the sections and articles hereof have
been inserted solely as a matter of convenience and in no way define or limit
the scope or intent of any provisions of the Plan.
13.9 This Plan shall be governed by the laws of the State of New
York from time to time in effect.
Exhibit A
File: 4.67 - forms\pension.bep
GENERAL SIGNAL CORPORATION
BENEFIT EQUALIZATION PLAN
As Amended and Restated
October 14, 1993
GENERAL SIGNAL CORPORATION
BENEFIT EQUALIZATION PLAN
TABLE OF CONTENTS
PAGE
ARTICLE I Purpose . . . . . . . . . . . . . . . 1
ARTICLE II Definitions . . . . . . . . . . . . . 1
ARTICLE III Eligibility . . . . . . . . . . . . . 2
ARTICLE IV Pension Benefits. . . . . . . . . . . 2
ARTICLE V Source of Payment . . . . . . . . . . 3
ARTICLE VI Designation of Beneficiaries. . . . . 4
ARTICLE VII Administration of the Plan. . . . . . 4
ARTICLE IVIII Amendment and Termination . . . . . . 5
ARTICLE IX General Provisions. . . . . . . . . . 6
GENERAL SIGNAL CORPORATION
BENEFIT EQUALIZATION PLAN
ARTICLE I
Purpose
1.1 General Signal Corporation established this amended and restated
Benefit Equalization Plan effective as of October 14, 1993 solely for the
purpose of providing to its eligible employees benefits which would have been
payable from the tax-exempt trust under the tax-qualified pension benefit plan
known as the Corporate Retirement Plan of General Signal Corporation but for
the limitations placed by the Internal Revenue Code on benefits payable made
with respect to such employees under such plan.
The portions of the Plan providing benefits without regard to the
limitation on compensation under Section 401(a)(17) of the Code ($150,000 for
1994), and taking into account deferrals under the General Signal Corporation
Deferred Compensation Plan, constitutes an unfunded plan maintained primarily
for the purpose of providing deferred compensation for a select group of
management or highly compensated employees. The portion of the Plan providing
benefits above the limitations prescribed under Section 415 of the Code
constitutes an "excess benefit plan" as defined in Section 3(36) of the
Employee Retirement Security Act of 1974.
ARTICLE II
Definitions
When used herein, the following terms shall have the following meanings:
2.1 "Act" means the Employee Retirement Income Security Act of 1974
as amended from time to time.
2.2 "Beneficiary" means the beneficiary or beneficiaries designated
in accordance with Article VI of the Plan to receive the amount, if any,
payable upon the death of an Employee who participates in the Plan.
2.3 "Benefit Limitations" means (a) the maximum "annual benefit"
payable under the Corporate Retirement Plan in accordance with Section 415 of
the Code, and (b) the maximum amount of pension plan benefits that could have
been provided under the Corporate Retirement Plan without regard to the
limitation prescribed under Section 401(a)(17) of the Code on the amount of
annual compensation that can be taken into account under the Corporate
Retirement Plan.
2.4 "Board of Directors" means the Board of Directors of the
Company.
2.5 "Code" means the Internal Revenue Code, as amended from time to
time.
2.6 "Company" means General Signal Corporation, a New York
corporation, and its successors or assigns.
2.7 "Corporate Pension Board" means the board appointed to
administer the Corporate Retirement Plan.
2.8 "Corporate Retirement Plan" means the Corporate Retirement Plan
of General Signal Corporation, as amended and restated from time to time.
2.9 "Employee" means any person employed by an Employer who is
eligible to receive a benefit under the Corporate Retirement Plan.
2.10 "Employer" means the Company and each subsidiary thereof that
participates in the Corporate Retirement Plan.
2.11 "Pension Benefits" means the benefits described in Article IV
of the Plan.
2.12 "Plan" means the General Signal Corporation Benefit
Equalization Plan as set forth herein and as amended and restated from time to
time.
ARTICLE III
Eligibility
3.1 Each Employee with respect to whom benefits are reduced under
the Corporate Retirement Plan as a result of any of the Benefit Limitations
shall participate in the Plan.
ARTICLE IV
Pension Benefits
4.1 The amount of Pension Benefits payable to or in respect of an
Employee shall be equal to the actuarial value of the difference between (a)
the amount of benefits which would have been payable to or in respect of the
Employee under the Corporate Retirement Plan without regard to the Benefit
Limitations and (b) the amount of benefits actually payable to or in respect
of the Employee thereunder.
In addition, the amount of Pension Benefits shall be increased in
the amount of additional benefits to which the Employee would have been
entitled under the Corporate Retirement Plan had the deferral of any
compensation under the General Signal Corporation Deferred Compensation Plan
been included as part of the Employee's earnings and paid to the Employee
during the applicable calendar year.
4.2 Pension Benefits shall be payable in the form of a 50% joint and
survivor annuity, beginning on the individual's retirement date for the
individual and his spouse at that time, unless the Corporate Pension Board
authorizes another manner or time of payment.
The Company reserves the right to limit payments in any given year
to such amount as would not cause a loss of deductibility pursuant to Section
162(m) of the Code.
ARTICLE V
Source of Payment
5.1 All payments provided for under the Plan shall be paid in cash
from the general funds of the Company; provided, however, that such payments
shall be reduced by the amount of any payments made to the Employee or his or
her dependents, beneficiaries or estate from any trust or special or separate
fund established by the Company to assure such payments. The Company shall
not be required to establish a special or separate fund or other segregation
of assets to assure such payments, and, if the Company shall make any
investments to aid it in meeting its obligations hereunder, a participant
shall have no right, title, or interest whatever in or to any such investments
except as may otherwise be expressly provided in a separate written instrument
relating to such investments. Nothing contained in this Plan, and no action
taken pursuant to its provisions, shall create or be construed to create a
trust of any kind between the Company and any participants. To the extent
that any participant acquires a right to receive payments from the Company
hereunder, such right shall be no greater than the right of an unsecured
creditor of the Company.
5.2 The Corporate Pension Board may, for administrative reasons,
establish a grantor trust for the benefit of participants in the Plan. The
assets of said trust will be held separate and apart from other Company funds
and shall be used exclusively for the purposes set forth in the Plan and the
applicable trust agreement, subject to the following conditions:
(a) the creation of said trust shall not cause the Plan to be other
than "unfunded" for purposes of Title I of the Act:
(b) the Company shall be treated as the "grantor" of said trust for
purposes of Sections 671 and 677 of the Code; and
(c) said trust agreement shall provide that its assets may be used
to satisfy claims of the Company's general creditors, provided that the rights
of such general creditors are enforceable under federal and state law.
ARTICLE VI
Designation of Beneficiaries
6.1 Unless an Employee who participates in the Plan otherwise files
with the Corporate Pension Board a written designation of one or more persons
as the Beneficiary who shall be entitled to receive the amount, if any,
payable under the Plan upon his death, the Employee's beneficiary under the
Corporate Retirement Plan shall be deemed to have been designated his
Beneficiary for Pension Benefits. If the Corporate Pension Board is in doubt
as to the right of any person to receive such amount, the Corporate Pension
Board may retain such amount, without liability for any interest thereon,
until the rights thereto are determined, or the Corporate Pension Board may
pay such amount into any court of appropriate jurisdiction and such payment
shall be a complete discharge of the liability of the Plan and the Company
therefor.
ARTICLE VII
Administration of the Plan
7.1 The Plan shall be administered by the Corporate Pension Board
which shall have full power and authority to interpret, construe and
administer the Plan, and review claims for benefits under the Plan, and the
Corporate Pension Board's interpretations and constructions of the Plan and
actions thereunder shall be binding and conclusive on all persons and for all
purposes.
7.2 The members of the Corporate Pension Board shall be the named
fiduciaries of the Plan for administration of the Plan (including but not
limited to complying with reporting and disclosure requirements and
establishing and maintaining Plan records), and shall engage such certified
public accountants, who may be accountants for the Company, as it shall
require or may deem advisable for purposes of the Plan. The Corporate Pension
Board may arrange for the engagement of such legal counsel, who may be counsel
for the Company, and make use of such agents and clerical or other personnel
as they each shall require or may deem advisable for purposes of the Plan.
The Corporate Pension Board may rely upon the written opinion of such counsel
and the accountants engaged by the Corporate Pension Board and may delegate to
any such agent or to any sub-committee or member of the Corporate Pension
Board its authority to perform any act hereunder, including without limitation
those matters involving the exercise of discretion, provided that such
delegation shall be subject to revocation at any time at the discretion of the
Corporate Pension Board.
7.3 No member of the Corporate Pension Board shall be personally
liable by reason of any contract or other instrument executed by him or on his
behalf in his capacity as a member of the Corporate Pension Board nor for any
mistake of judgment made in good faith, and the Company shall indemnify and
hold harmless, directly from its own assets (including the proceeds of any
insurance policy the premiums of which are paid from the Company's own
assets), each member of the Corporate Pension Board and each other officer,
employee, or director of the Company to whom any duty or power relating to the
administration or interpretation of the Plan or to the management or control
of the assets of the Plan may be delegated or allocated, against any cost or
expense (including counsel fees) or liability (including any sum paid in
settlement of a claim with the approval of the Company) arising out of any act
or omission to act in connection with the Plan unless arising out of such
person's own fraud or bad faith.
7.4 If any claim for benefits under the Plan is wholly or partially
denied, the Corporate Pension Board shall give written notice by registered or
certified mail of such denial to the claimant within 90 days after receipt of
the written claim by the Corporate Pension Board. Notice must be written in a
manner calculated to be understood by the claimant, setting forth the specific
reasons for such denial, specific reference to pertinent Plan provisions on
which the denial is based, a description of any additional material or
information necessary for the claimant to perfect the claim and an explanation
of why such material or information is necessary, and an explanation of the
Plan's claim review procedure. The Corporate Pension Board shall also advise
the claimant that he or his duly authorized representative may request a
review by the Corporate Pension Board of the decision to deny the claim by
filing with the Corporate Pension Board, within 65 days after such notice has
been received by the claimant, a written request for such review. The
claimant may review pertinent documents and submit issues and comments in
writing within the same 65 day period. If such request is so filed, such
review shall be made by the Board with 60 days after receipt of such request,
unless special circumstances (including, but not limited to, a need to hold a
hearing) require an extension of time for processing, in which case a decision
shall be rendered not later than 120 days after receipt of the request for
review. The claimant shall be given written notice within such 60 day period
of the decision resulting from such review, which 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 was based.
ARTICLE VIII
Amendment and Termination
8.1 The Plan may be amended, suspended or terminated, in whole or in
part, by the Board of Directors, but no such action shall retroactively impair
or otherwise adversely affect the rights of any person to benefits under the
Plan which have accrued prior to the date of such action, as determined by the
Corporate Pension Board.
ARTICLE IX
General Provisions
9.1 This Plan shall be binding upon and inure to the benefit of the
Company and its successors and assigns and the Employee, his designees and his
estate. Nothing in this Plan shall preclude the Company from consolidating or
merging into or with, or transferring all or substantially all of its assets
to, another corporation which assumes this Plan and all obligations of the
Company hereunder. Upon such a consolidation, merger or transfer of assets
and assumption, the term "Company" shall refer to such other corporation and
this Plan shall continue in full force and effect.
9.2 Neither the Plan nor any action taken hereunder shall be
construed as giving to an Employee the right to be retained in the employ of
the Employer or as affecting the right of the Employer to dismiss any
Employee.
9.3 The Company may withhold from any benefits payable under this
Plan all Federal, state, city or other taxes as shall be required pursuant to
any law or governmental regulation or ruling.
9.4 Except insofar as may otherwise be required by law, no amount
payable at any time under the Plan and the Fund shall be subject in any manner
to alienation by anticipation, sale, transfer, assignment, bankruptcy, pledge,
attachment, charge or encumbrance of any kind nor in any manner be subject to
the debts or liabilities of any person and any attempt to so alienate or
subject any such amount, whether presently or thereafter payable, shall be
void. If any person shall attempt to, or shall alienate, sell, transfer,
assign, pledge, attach, charge or otherwise encumber any amount payable under
the Plan and Fund, or any part thereof, or if by reason of his bankruptcy or
other event happening at any such time such amount would be made subject to
his debts or liabilities or would otherwise not be enjoyed by him, then the
Corporate Pension Board, if it so elects, may direct that such amount be
withheld and that the same or any part thereof be paid or applied to or for
the benefit of such person, his spouse, children or other dependents, or any
of them, in such manner and proportion as the Corporate Pension Board may deem
proper.
9.5 If the Corporate Pension Board shall find that any person to
whom any amount is or was payable hereunder is unable to care for his affairs
because of illness or accident, or has died, then the Company, if it so
elects, may direct that any payment due him or his estate (unless a prior
claim therefor has been made by a duly appointed legal representative) or any
part thereof be paid or applied for the benefit of such person or to or for
the benefit of his spouse, children or other dependents, an institution
maintaining or having custody of such person, any other person deemed by the
Corporate Pension Board to be a proper recipient on behalf of such person
otherwise entitled to payment, or any of them, in such manner and proportion
as the Company may deem proper. Any such payment shall be in complete
discharge of the liability of the Corporate Pension Board therefor.
9.6 Whenever, under this Plan, it is necessary to determine whether
one benefit is less than, equal to, or larger than another, whether or not
such benefits are provided under this Plan, such determination shall be made
by the Company's independent consulting actuary, using mortality, interest and
any other assumptions normally used at the time by such actuary in determining
actuarial equivalents under the Corporate Retirement Plan.
9.7 All elections, designations, requests, notices, instructions,
and other communications from an Employee, Beneficiary or other person to the
Corporate Pension Board required or permitted under the Plan shall be in such
form as is prescribed from time to time by the Corporate Pension Board, shall
be mailed by first-class mail or delivered to such location as shall be
specified by the Corporate Pension Board, and shall be deemed to have been
given and delivered only upon actual receipt thereof at such location.
9.8 The benefits payable under this Plan shall be in addition to all
other benefits provided for Employees of the Company.
9.9 The captions preceding the sections and articles hereof have
been inserted solely as a matter of convenience and in no way define or limit
the scope or intent of any provisions of the Plan.
9.10 This Plan shall be governed by the laws of the State of New
York from time to time in effect.
GENERAL SIGNAL CORPORATION
1992 STOCK INCENTIVE PLAN*
1. Purpose
The purpose of this Plan is to offer as an additional incentive to the
officers and other designated employees most responsible for the growth
and success of General Signal Corporation (the "Corporation") the
opportunity to increase their proprietary interest in the Corporation
under conditions which will encourage their continued employment in the
service of the Corporation. In addition, this Plan provides an
opportunity for non-employee directors to increase their interest as
shareholders of the Corporation, which serves to align the interests of
non-employee directors with other shareholders.
2. Administration
The portion of this Plan with respect to options and restricted stock
applicable to employees shall be administered by a Committee of not less
than three (3) members appointed annually by the Board of Directors.
The Committee, which may but need not be the Personnel and Compensation
Committee, shall be composed of members of the Board of Directors who
are not eligible to receive awards applicable to employees under this
Plan. The Committee shall act by a majority vote or by a written
statement signed by a majority of the members. Subject to the express
provisions of this Plan, the Committee shall determine the individuals
to whom, and the time or times at which awards shall be granted, the
number of shares to be subject to each award and other terms and
conditions thereof.
The portion of this Plan with respect to restricted stock applicable to
non-employee directors shall be administered by the Secretary of the
Corporation. Since the restricted stock is based on deferral elections
by non-employee directors, this function will be limited to matters of
interpretation and administration oversight.
3. Stock Subject to Plan
The shares to be issued under this Plan shall be made available, at the
discretion of the Board of Directors, either from the authorized but
unissued shares of Common Stock of the Corporation or from shares of
Common Stock reacquired by the Corporation, including shares purchased
in the open market.
Subject to the provisions of the next succeeding paragraph of this
Section 3, the aggregate number of shares of Common Stock reserved and
available for issuance under this Plan shall not exceed 1,800,000
shares.
If, prior to the termination of this Plan, an option granted under this
Plan shall expire, be canceled or terminate for any reason without
having been exercised in full, or if any shares subject to restrictions
are forfeited and the forfeiting person received no benefits of
ownership (other than voting rights), such as dividends from the
forfeited shares, the unpurchased or forfeited shares, as applicable,
shall again become available for awards under this Plan. In the event
that the number of outstanding shares of Common Stock of the Corporation
shall be changed by reason of split-ups or combinations of shares or
recapitalization or by reason of stock dividends, the number of shares
for which awards may thereafter be granted under this Plan, the number
of shares then subject to awards theretofore granted under this Plan,
and the price per share payable upon exercise of such awards, shall be
appropriately adjusted as determined by the Board of Directors so as to
reflect such
change. Awards may also contain provisions for their continuation or
for other equitable adjustments after changes in shares of Common Stock
resulting from reorganization, sale, merger, consolidation or similar
occurrence.
4. Eligibility and Participation
Awards of options and restricted stock applicable to employees may be
granted only to officers and other designated employees of the
Corporation and of its subsidiaries, present and future. A director of
the Corporation who is not also an officer or other employee of the
Corporation or of one of its subsidiaries ("Eligible Director") will be
eligible only with respect to the provisions of this Plan concerning the
deferral of directors' fees into restricted stock.
5. Stock Options
Grant
Subject to the provisions of this Plan, the Committee shall have sole
and complete authority to determine the persons to whom options shall be
granted, the number of shares to be covered by each option and the
conditions and limitations, if any, in addition to those set forth in
this Section 5, applicable to such options. At the discretion of the
Committee, options may be granted to replace shares of the Corporation's
Common Stock used as part or all of the purchase price of other options
under this Plan or any other stock option plan of the Corporation.
Option Prices
The purchase price of the Common Stock under each option shall be not
less than 100% of the fair market value of the stock on the date the
option is granted. The purchase price is to be paid in full upon the
exercise of the option, and payment shall be made in cash, or by check,
bank draft or money order payable to the order of the Corporation, or,
with the approval of the Committee, by delivering shares of Common Stock
of the Corporation of equivalent fair market value on the date the
option is exercised. Fair market value shall be the closing price on
the New York Stock Exchange or, in the event that no sale shall have
taken place, the mean between the closing bid and asked prices.
If the Committee grants any incentive stock options, within the meaning
of Section 422 of the Internal Revenue Code, the aggregate fair market
value, determined at the time such option is granted, of the shares with
respect to which such options are exercisable for the first time by any
one employee during any calendar year (under this Plan and any other
plan which is maintained by the Corporation or its subsidiaries and
which provides for the granting of such options) shall not exceed
$100,000.
Form of Option
Options granted pursuant to this Plan shall be evidenced by Stock Option
Agreements in such form as the Committee shall from time to time adopt.
Options may, but need not, be subject to such terms and conditions as
will qualify their holders for special Federal income tax treatment
pursuant to any provision of the Internal Revenue Code of 1986 as may be
enacted from time to time. Each option granted under this Plan shall be
exercisable on such date or dates and during such period and for such
number of shares as shall be determined pursuant to the provisions of
the Stock Option Agreement with respect to such option; provided,
however, that no option shall be exercised later than ten years from the
date of grant of the option. In any event, all options granted
hereunder shall terminate and expire upon the first to occur of the
following events:
(a) the termination date specified in the option agreement;
(b) the expiration of three (3) months from the date an optionee ceases
to be employed by the Corporation or its subsidiaries other than by
reason of death or retirement; provided, however, that the Committee may
permit an additional period of up to five (5) years to exercise an
option from the date an optionee ceases to be employed involuntarily by
the Corporation or its subsidiaries by reason of the sale or other
disposition of a subsidiary or a division;
(c) the expiration of five (5) years from the date an optionee ceases to
be employed by the Corporation or its subsidiaries by reason of
retirement in accordance with the terms of a pension plan maintained by
the Corporation or a subsidiary, or the expiration of one (1) year from
such retiree's death, whichever is later; and
(d) the expiration of one (1) year from the date of an optionee's death
if his death occurs at a time when the optionee is in the employ of the
Corporation or a subsidiary.
After termination of employment for any reason, an optionee, or his
legal representative, may exercise, subject to the above time
limitations, only that portion of his option which he has a right to
exercise on such date of termination unless the Stock Option Agreement
specifically allows a greater portion of the option to continue to
become exercisable within such time limitations.
The Committee may in its sole discretion include in any option granted
pursuant to this Section 5 a provision to the effect that, in the event
of a change in control of the Corporation (as such term may be defined
by the Committee), each outstanding option shall be canceled at such
time as the Committee shall specify, and in lieu thereof the participant
shall have a right to receive cash payments in such amounts and subject
to such vesting and payout terms as the Committee may prescribe.
Compensation in Lieu of Exercise
Upon written application of an optionee, the Corporation may, with the
approval of the Committee, substitute for the exercise of an option
compensation to the optionee not in excess of the difference between the
option price and the fair market value, determined in accordance with
this Section 5, of the shares covered by such written application as of
the date thereof. Such compensation may be in cash or shares of Common
Stock of equivalent fair market value, or both, as the Committee may
determine. In the event compensation is substituted pursuant to this
Section 5 for the exercise, in whole or in part, of an option, the
option shall be reduced by the option shares for which such compensation
is substituted, and such shares shall again be available for awards
under this Plan. Notwithstanding anything to the contrary contained
herein, for the purpose of determining the difference between the option
price and the fair market value to optionees who request such
substitution, such fair market value shall be deemed to be the closing
sale price of the Corporation's Common Stock on the New York Stock
Exchange on the date of such request or, with respect to requests during
the period beginning on the third business day following the date of
release by the Corporation of its quarterly financial results and ending
on the twelfth business day following the date of such release, such
fair market value shall be determined by the Committee but shall not
exceed the highest closing sale price or be less than the lowest closing
price of the Corporation's Common Stock on the New York Stock Exchange
during such period.
Non-Transferability of Option
No option granted under this Plan shall be transferable otherwise than
by will or the laws of descent and distribution, and an option may be
exercised during the lifetime of the holder thereof, only by him.
6. Restricted Stock
Grant
Subject to the provisions of this Plan, the Committee shall have sole
and complete authority to determine the officers and other employees to
whom, and the time or times at which, grants of restricted stock will be
made, the number of shares to be awarded, the time or times within which
such awards may be subject to forfeiture, and all other terms and
conditions of the awards.
Restricted stock awards granted pursuant to this Plan shall be evidenced
by a Restricted Stock Agreement in such form as the Committee shall from
time to time adopt. The Committee may condition the lapse of
restrictions on restricted stock upon the attainment of specified
performance goals or such other factors as the Committee may determine,
in its sole discretion.
Each participant receiving a restricted stock award shall be issued a
stock certificate in respect of such shares of restricted stock. Such
certificate shall be registered in the name of such participant and
shall bear an appropriate legend referring to the terms, conditions and
restrictions applicable to such award.
The Committee shall require that stock certificates evidencing such
shares be held by the Corporation until the restrictions thereon shall
have lapsed, and that, as a condition of any restricted stock award, the
participant shall have delivered to the Corporation a stock power,
endorsed in blank, relating to the stock covered by such award.
Restrictions and Conditions
The shares of restricted stock awarded pursuant to this Section 6 shall
be subject to the following restrictions and conditions:
(a) During a period set by the Committee commencing with the date of
such award (the "Restriction Period"), the participant shall not be
permitted to sell, transfer, pledge or assign shares of restricted stock
awarded under the Plan. Within these limits, the Committee, in its sole
discretion, may provide for the lapse of such restrictions in
installments and may accelerate or waive such restrictions in whole or
in part, based on service, performance and/or such other factors or
criteria as the Committee may determine;
(b) Except as provided in paragraph (a) above, the participant shall
have, with respect to the shares of restricted stock, all of the rights
of a shareholder of the Corporation, including the right to vote the
shares, and the right to receive any cash dividends;
(c) Upon termination of a participant's employment with the Corporation
or any subsidiary for any reason during the Restriction Period, shares
still subject to restriction will vest, or be forfeited, in accordance
with the terms and conditions established by the Committee in the
Restricted Stock Agreement;
(d) If and when the Restriction Period expires without a prior
forfeiture of the restricted stock subject to such Restriction Period,
certificates for an appropriate number of unrestricted shares of stock
shall be delivered promptly to the participant, and the certificates for
the shares of restricted stock shall be canceled.
The Committee may in its sole discretion include in any restricted stock
award pursuant to this Section 6 a provision to the effect that, in the
event of a change in control of the Corporation (as such term may be
defined by the Committee), such restricted stock (to the extent not
vested) shall be forfeited at such time as the Committee shall specify,
and in lieu thereof the participant shall have a right to receive cash
payments in such amounts and subject to such vesting and payout terms as
the Committee may prescribe.
7. Directors' Fees
Deferral of Regular Cash Compensation into Restricted Stock
Each Eligible Director may elect to reduce all or part of the cash
compensation otherwise payable for services to be rendered by him as a
director (including the annual retainer and any fees payable for serving
on the Board or a Committee of the Board) and to receive in lieu thereof
restricted stock. Any such election shall be in writing and must be
made at least six months before the services are rendered giving rise to
such compensation, and may not be revoked or changed thereafter except
as to compensation for services rendered at least six months after any
such election to revoke or change is made in writing. In consideration
for forgoing cash compensation, the amount so deferred shall be
increased (subject to Section 8) by 10% for purposes of determining the
amount of restricted stock to be credited to such director.
If an Eligible Director so elects to defer, there shall be credited to
such director a number of shares of restricted stock equal to the amount
of the deferral (increased by 10% as described in the preceding
sentence) divided by the reported closing price of the stock on the New
York Stock Exchange - Composite Transactions on the last business day of
the month in which the compensation would have been paid in the absence
of a deferral election.
Restrictions and Forfeiture
Restricted stock issued under this Section shall have a restriction
period of five (5) years. Notwithstanding any other provision of this
Section, such restricted stock shall be subject to the following terms
and conditions:
(a) Restricted stock shall be represented by a stock certificate
registered in the name of the holder. The holder shall have the right
to enjoy all shareholder rights during the restriction period (including
the right to vote the shares and the right to receive any cash
dividends) with the exception that:
(i) The holder may not sell, transfer, pledge or assign the stock during
the restriction period;
(ii) The Corporation may either issue shares subject to such restrictive
legends and/or stop transfer instructions as it deems appropriate or
provide for retention of custody of the stock during the restriction
period; and
(iii) A breach of the terms and conditions during the restriction period
shall cause a forfeiture of the restricted stock.
(b) All restrictions shall lapse and the holder of restricted stock
shall be entitled to the delivery of a stock certificate or certificates
upon the earliest of the following:
(i) Five (5) years from the date the applicable shares are credited to
such holder;
(ii) The date of the holder's death or disability;
(iii) The date the holder, after being nominated by the Board, is not
elected by the shareholders in an election for the Board; or
(iv) The date on which the Board determines that the holder will not be
nominated for election to the Board.
(v) The date on which the holder resigns from the Board in connection
with his entering into any governmental, diplomatic or other service or
employment, but only if, in the opinion of outside legal counsel
selected by the Corporation, the holder's continued service on the Board
would have created an inadvisable potential conflict of interest.
(c) Restricted stock shall be entirely forfeited in the event that
during a restriction period the holder:
(i) Resigns (other than by reason of disability or pursuant to
subsection (b)(v) above) or is dismissed for cause from the Board during
his elected term; or
(ii) Refuses to stand for an election to the Board after having been
nominated by the Board.
For purposes of subsection (b) above, "disability" shall mean long term
disability as determined under rules and procedures that apply under the
Corporation's Long Term Disability Plan then in effect. For purposes of
subsection (c) above, a holder shall be considered to have been
dismissed for cause if and only if he is dismissed on account of any act
of (a) fraud or intentional misrepresentation, or (b) embezzlement,
misappropriation, or conversion of assets or opportunities of the
Corporation or any direct or indirect majority-owned subsidiary of the
Corporation.
The holder may elect in writing at least three months before the end of
any restriction period irrevocably to re-defer restricted stock for
additional five (5)-year periods subject to the above terms and
conditions.
8. Effective Period of Plan
This Plan shall become effective upon the date of its approval by the
shareholders of the Corporation. Unless earlier terminated by the Board
of Directors, this Plan shall terminate on April 22, 1997 but such
termination shall not affect awards granted prior thereto.
Notwithstanding the foregoing, the provisions set forth in Section 7
with respect to the increase in the amount deferred by 10% for purposes
of determining the amount of restricted stock to be credited to an
Eligible Director shall not be effective unless and until the Secretary
of the Corporation shall be satisfied that such provisions are not
inconsistent with the requirements of Rule 16b-3 under the Securities
Exchange Act of 1934, and if the Secretary of the Corporation determines
that only a lesser percentage than 10% shall be consistent with such
requirements, such lesser percentage shall be substituted for 10% in
Section 7.
9. Amendment of Plan
The Board of Directors of the Corporation may from time to time make
such amendments of this Plan as it shall deem advisable; provided,
however, that the Board of Directors may not, without further approval
of the holders of a majority of all outstanding shares of the
Corporation entitled to vote thereon, increase the maximum number of
shares as to which awards may be granted under this Plan (except as
otherwise provided in Section 3), permit the granting of options at less
than 100% of fair market value at time of grant or change the class of
persons eligible to receive awards under this Plan. No amendment of
this Plan may, without the consent of the holder of an existing award,
adversely affect his rights thereunder. In addition, the provisions of
this Plan applicable to non-employee directors may not be amended more
than once every six months other than to comport with changes in the
Internal Revenue Code, the Employee Retirement Income Security Act of
1974, or the rules thereunder.
* As Amended and Restated July 7, 1993
GENERAL SIGNAL CORPORATION
1989 STOCK OPTION AND INCENTIVE PLAN*
1. Purpose
The purpose of this Plan is to offer as an additional
incentive to the officers and other key employees most
responsible for the growth and success of General Signal
Corporation (the "Corporation") the opportunity to increase
their proprietary interest in the Corporation under conditions
which will encourage their continued employment in the service
of the Corporation.
2. Administration
This Plan shall be administered by a Committee of not less
than three (3) members appointed annually by the Board of
Directors. The Committee, which may but need not be the
Compensation Committee, shall be composed of members of the
Board of Directors who are not eligible to receive awards under
this Plan. The Committee shall act by a majority vote or by a
written statement signed by a majority of the members. Subject
to the express provisions of this Plan, the Committee shall
determine the individuals to whom, and the time or times at
which awards shall be granted, the number of shares to be
subject to each award and other terms and conditions thereof.
3. Stock Subject to Plan
The shares to be issued under this Plan shall be made
available, at the discretion of the Board of Directors, either
from the authorized but unissued shares of Common Stock of the
Corporation or from shares of Common Stock reacquired by the
Corporation, including shares purchased in the open market.
Subject to the provisions of the next succeeding paragraph
of this Section 3, the aggregate number of shares of Common
Stock reserved and available for issuance under this Plan shall
not exceed 1,200,000 shares.
If, prior to the termination of this Plan, an option
granted under this Plan shall expire, be cancelled or terminate
for any reason without having been exercised in full, or if any
shares subject to restricted stock awards are forfeited, the
unpurchased or forfeited shares, as applicable, shall again
become available for awards under this Plan, except as
otherwise provided in paragraph 5. In the event that the
number of outstanding shares of Common Stock of the Corporation
shall be changed by reason of split-ups or combinations of
shares or recapitalization or by reason of stock dividends, the
*as amended July 7, 1993
number of shares for which awards may thereafter be granted
under this Plan, the number of shares then subject to awards
theretofore granted under this Plan and the price per share
payable upon exercise of such awards, shall be appropriately
adjusted as determined by the Board of Directors so as to
reflect such change. Awards may also contain provisions for
their continuation or for other equitable adjustments after
changes in shares of Common Stock resulting from
reorganization, sale, merger, consolidation or similar
occurrence.
4. Eligibility and Participation
Awards may be granted only to officers and other key
employees of the Corporation and of its subsidiaries, present
and future. A director of the Corporation or of a subsidiary
who is not also an officer or other key employee of the
Corporation or of one of its subsidiaries will not be eligible.
5. Stock Options
Grant
Subject to the provisions of this Plan, the Committee
shall have sole and complete authority to determine the persons
to whom options shall be granted, the number of shares to be
covered by each option and the conditions and limitations, if
any, in addition to those set forth in this Section 5,
applicable to such options.
Option Prices
The purchase price of the Common Stock under each option
shall be not less than 100% of the fair market value of the
stock on the date the option is granted. The purchase price is
to be paid in full upon the exercise of the option, and payment
shall be made in cash, or by check, bank draft or money order
payable to the order of the Corporation, or, with the approval
of the Committee, by delivering shares of Common Stock of the
Corporation of equivalent fair market value on the date the
option is exercised. Fair market value shall be the closing
price on the New York Stock Exchange or, in the event that no
sale shall have taken place, the mean between the closing bid
and asked prices.
If the Committee grants any incentive stock options,
within the meaning of Section 422A of the Internal Revenue
Code, the aggregate fair market value, determined at the time
such option is granted, of the shares with respect to which
such options are exercisable for the first time by any one
employee during any calendar year (under this Plan and any
other plan which is maintained by the Corporation or its
subsidiaries and which provides for the granting of such
options) shall not exceed $100,000.
Form of Option
Options granted pursuant to this Plan shall be evidenced
by Stock Option Agreements in such form as the Committee shall
from time to time adopt. Options may, but need not, be subject
to such terms and conditions as will qualify their holders for
special Federal income tax treatment pursuant to any provision
of the Internal Revenue Code of 1986 as may be enacted from
time to time. Each option granted under this Plan shall be
exercisable on such date or dates and during such period and
for such number of shares as shall be determined pursuant to
the provisions of the Stock Option Agreement with respect to
such option; provided, however, that no option shall be
exercised later than ten years from the date of grant of the
option. In any event, all options granted hereunder shall
terminate and expire upon the first to occur of the following
events:
(a) the termination date specified in the option
agreement;
(b) the expiration of three (3) months from the date
an optionee ceases to be employed by the Corporation or
its subsidiaries other than by reason of death or
retirement; provided, however, the Committee may permit an
additional period of up to five years to exercise an
option from the date an optionee ceases to be employed
involuntarily by the Corporation or its subsidiaries by
reason of the sale or other disposition of a subsidiary or
a division;
(c) the expiration of five (5) years from the date an
optionee ceases to be employed by the Corporation or its
subsidiaries by reason of retirement in accordance with
the terms of a pension plan maintained by the Corporation
or a subsidiary, or the expiration of one (1) year from
such retiree's death, whichever is later; and
(d) the expiration of one (1) year from the date of
an optionee's death if his death occurs at a time when the
optionee is in the employ of the Corporation or a
subsidiary.
After termination of employment for any reason, an
optionee, or his legal representative, may exercise, subject to
the above time limitations, only that portion of his option
which he has a right to exercise on such date of termination
unless the Stock Option Agreement specifically allows a greater
portion of the option to continue to become exercisable within
such time limitations.
Compensation in Lieu of Exercise
Upon written application of an optionee, the Corporation
may, with the approval of the Committee, substitute for the
exercise of an option compensation to the optionee not in
excess of the difference between the option price and the fair
market value, determined in accordance with this Section 5, of
the shares covered by such written application as of the date
thereof. Such compensation may be in cash or shares of Common
Stock of equivalent fair market value, or both, as the
Committee may determine. In the event compensation is
substituted pursuant to this Section 5 for the exercise, in
whole or in part, of an option, the option shall be reduced by
the option shares for which such compensation is substituted,
and such shares shall not again be available for awards under
this Plan. Notwithstanding anything to the contrary contained
herein, for the purpose of determining the difference between
the option price and the fair market value to optionees who are
subject to the provisions of Section 16(b) of the Securities
Exchange Act of 1934, and who request such substitution during
"window periods" specified by Rule 16b-3 promulgated
thereunder, the Committee may determine that there be a single
fair market value for the Corporation's Common Stock for each
such "window period", being the average closing market value
for the Corporation's Common Stock during such "window period".
Non-Transferability of Option
No option granted under this Plan shall be transferable
otherwise than by will or the laws of descent and distribution,
and an option may be exercised during the lifetime of the
holder thereof, only by him.
6. Restricted Stock
Grant
Subject to the provisions of this Plan, the Committee
shall have sole and complete authority to determine the persons
to whom, and the time or times at which, grants of restricted
stock will be made, the number of shares to be awarded, the
time or times within which such awards may be subject to
forfeiture, and all other terms and conditions of the awards.
Restricted stock awards granted pursuant to this Plan
shall be evidenced by a Restricted Stock Agreement in such form
as the Committee shall from time to time adopt. The Committee
may condition the lapse of restrictions on restricted stock
upon the attainment of specified performance goals or such
other factors as the Committee may determine, in its sole
discretion.
Each participant receiving a restricted stock award shall
be issued a stock certificate in respect of such shares of
restricted stock. Such certificate shall be registered in the
name of such participant and shall bear an appropriate legend
referring to the terms, conditions, and restrictions applicable
to such award.
The Committee shall require that stock certificates
evidencing such shares be held by the Corporation until the
restrictions thereon shall have lapsed, and that, as a
condition of any restricted stock award, the participant shall
have delivered to the Corporation a stock power, endorsed in
blank, relating to the stock covered by such award.
Restriction and Conditions
The shares of restricted stock awarded pursuant to this
Section 6 shall be subject to the following restrictions and
conditions:
(a) During a period set by the Committee commencing
with the date of such award (the "Restriction Period"),
the participant shall not be permitted to sell, transfer,
pledge or assign shares of restricted stock awarded under
the Plan. Within these limits, the Committee, in its sole
discretion, may provide for the lapse of such restrictions
in installments and may accelerate or waive such
restrictions in whole or in part, based on service,
performance and/or such other factors or criteria as the
Committee may determine.
(b) Except as provided in this paragraph (b) and
paragraph (a) above, the participant shall have, with
respect to the shares of restricted stock, all of the
rights of a shareholder of the Corporation, including the
right to vote the shares, and the right to receive any
cash dividends.
(c) Upon termination of a participant's employment
with the Corporation or any Subsidiary for any reason
during the Restriction Period, shares still subject to
restriction will vest, or be forfeited, in accordance with
the terms and conditions established by the Committee in
the Restricted Stock Agreement.
(d) If and when the Restriction Period expires
without a prior forfeiture of the restricted stock subject
to such Restriction Period, certificates for an
appropriate number of unrestricted shares of stock shall
be delivered promptly to the Participant, and the
certificates for the shares of restricted stock shall be
cancelled.
7. Effective Period of Plan
This Plan shall become effective upon the date of its
approval by the shareholders of the Corporation. Unless
earlier terminated by the Board of Directors, this Plan shall
terminate April 19, 1994, but such termination shall not affect
awards granted prior thereto.
8. Amendment of Plan
The Board of Directors of the Corporation may from time to
time make such amendments of this Plan as it shall deem
advisable; provided, however, that the Board of Directors may
not, without further approval of the holders of a majority of
all outstanding shares of the Corporation entitled to vote
thereon, increase the maximum number of shares as to which
awards may be granted under this Plan (except as otherwise
provided in Section 3), permit the granting of options at less
than 100% of fair market value at time of grant, or change the
class of employees eligible to receive awards under this Plan.
No amendment of this Plan may, without the consent of the
holder of an existing award, adversely affect his rights
thereunder.
GENERAL SIGNAL CORPORATION
1985 STOCK OPTION PLAN*
1. Purpose
The purpose of this Plan is to offer as an additional incentive to
the officers and other key employees most responsible for the growth and
success of General Signal Corporation (the "Corporation") the opportunity to
increase their proprietary interest in the Corporation under conditions which
will encourage their continued employment in the service of the Corporation.
2. Administration
This Plan shall be administered by a Committee of not less than
three (3) members appointed annually by the Board of Directors. The
Committee, which may but need not be the Compensation Committee, shall be
composed of members of the Board of Directors who are not eligible to receive
options under this Plan. The Committee shall act by a majority vote or by a
written statement signed by a majority of the members. Subject to the express
provisions of this Plan, the Committee shall determine the individuals to
whom, and the time or times at which options shall be granted, the number of
shares to be subject to each option, the period of each option and other terms
and conditions thereof.
3. Stock Subject to Plan
The shares to be issued upon exercise of options granted under this
Plan shall be made available, at the discretion of the Board of Directors,
either from the authorized but unissued shares of Common Stock of the
Corporation or from shares of Common Stock reacquired by the Corporation,
including shares purchased in the open market.
Subject to the provisions of the next succeeding paragraph of this
Section 3, the aggregate number of shares of Common Stock for which options
may be granted under this Plan shall not exceed 1,500,000 shares.
If, prior to the termination of this Plan, an option granted under
this Plan shall expire, be cancelled or terminate for any reason without
having been exercised in full, the unpurchased shares shall again become
available for option under this Plan, except as otherwise provided in
paragraph 7. In the event that the number of outstanding shares of Common
Stock of the Corporation shall be changed by reason of split-ups or
combinations of shares or recapitalization or by reason of stock dividends,
the number of shares for which options may thereafter be granted under this
Plan, the number of shares then subject to options theretofore granted
* As Amended and Restated - July 7, 1993
under this Plan and the price per share payable upon exercise of
such options, shall be appropriately adjusted as determined by the Board of
Directors so as to reflect such change. Options may also contain provisions
for their continuation or for other equitable adjustments after changes in
shares of Common Stock resulting from reorganization, sale, merger,
consolidation or similar occurrence.
4. Eligibility and Participation
Options may be granted only to officers and other key employees of
the Corporation and of its subsidiaries, present and future. A director of
the Corporation or of a subsidiary who is not also an officer or other key
employee of the Corporation or of one of its subsidiaries, will not be
eligible.
5. Option Prices
The purchase price of the Common Stock under each option shall be
not less than 100% of the fair market value of the stock on the date the
option is granted. The purchase price is to be paid in full upon the exercise
of the option, and payment shall be made in cash, or by check, bank draft or
money order payable to the order of the Corporation, or, with the approval of
the Committee, by delivering shares of Common Stock of the Corporation of
equivalent fair market value on the date the option is exercised. Fair market
value shall be the closing price on the New York Stock Exchange or, in the
event that no sale shall have taken place, the mean between the closing bid
and asked prices.
If the Committee grants any incentive stock options, within the
meaning of Section 422A of the Internal Revenue Code, the aggregate fair
market value, determined as of the time such option is granted, of the shares
for which such options may be granted to any one employee in any calendar year
(under this Plan and any other plan which is maintained by the Corporation or
its subsidiaries and which provides for the granting of such options) shall
not exceed $100,000 plus any unused limit carryover to such year, as
determined under Section 422A of the Internal Revenue Code.
6. Form of Option
Options granted pursuant to this Plan shall be evidenced by Stock
Option Agreements in such form as the Committee shall from time to time adopt.
Options may, but need not, be subject to such terms and conditions as will
qualify their holders for special Federal income tax treatment pursuant to any
provision of the Internal Revenue Code of 1954 as may be enacted from time to
time. Each option granted under this Plan shall be exercisable on such date
or dates and during such period and for such number of shares as shall be
determined pursuant to the provisions of the Stock Option Agreement with
respect to such option; provided, however, that no option shall be exercised
later than ten years from the date of grant of the option. In any event, all
options granted hereunder shall terminate and expire upon the first to occur
of the following events:
(a) the termination date specified in the option agreement; (b) the
expiration of three (3) months from the date an optionee ceases to be employed
by the Corporation or its subsidiaries other than by reason of death or
retirement; provided, however, the Committee may permit an additional period
of up to five years to exercise an option from the date an optionee ceases to
be employed involuntarily by the Corporation or its subsidiaries by reason of
the sale or other disposition of a subsidiary or a division; (c) the
expiration of five (5) years from the date an optionee ceases to be employed
by the Corporation or its subsidiaries by reason of retirement in accordance
with the terms of a pension plan maintained by the Corporation or a
subsidiary, or the expiration of one (1) year from such retiree's death,
whichever is later; and (d) the expiration of one (1) year from the date of an
optionee's death if his death occurs at a time when the optionee is in the
employ of the Corporation or a subsidiary.
After termination of employment for any reason, an optionee, or his
legal representative, may exercise, subject to the above time limitations,
only that portion of his option which he has a right to exercise on such date
of termination unless the Stock Option Agreement specifically allows a greater
portion of the option to continue to become exercisable within such time
limitations.
7. Compensation in Lieu of Exercise
Upon written application of an optionee, the Corporation may, with
the approval of the Committee, substitute for the exercise of an option,
compensation to the optionee not in excess of the difference between the
option price and the fair market value, determined in accordance with Section
5 of this Plan, of the shares covered by such written application as of the
date thereof. Such compensation may be in cash or shares of Common Stock of
equivalent fair market value, or both, as the Committee may determine. In the
event compensation is substituted pursuant to this paragraph 7 for the
exercise, in whole or in part, of an option, the option shall be reduced by
the option shares for which such compensation is substituted and such shares
shall not again be available for option under this Plan. Notwithstanding
anything to the contrary contained herein, for the purpose of determining the
difference between the option price and the fair market value to optionees who
are subject to the provisions of Section 16(b) of the Securities Exchange Act
of 1934, and who request such substitution during "window periods" specified
by Rule 16b-3 promulgated thereunder, the Committee may determine that there
be a single fair market value for the Corporation's Common Stock for each such
"window period", being the average closing market value for the Corporation's
Common Stock during such "window period".
8. Non-Transferability of Option
No option granted under this Plan shall be transferable otherwise
than by will or the laws of descent and distribution and an option may be
exercised during the lifetime of the holder thereof, only by him.
9. Effective Period of Plan
This Plan shall become effective upon the date of its approval by
the shareholders of the Corporation. Unless earlier terminated by the Board
of Directors, this Plan shall terminate April 17, 1990, but such termination
shall not affect options issued prior thereto.
10. Amendment of Plan
The Board of Directors of the Corporation may from time to time make
such amendments of this Plan as it shall deem advisable; provided, however,
that the Board of Directors may not, without further approval of the holders
of a majority of all outstanding shares of the Corporation entitled to vote
thereon, increase the maximum number of shares as to which options may be
granted under this Plan (except as otherwise provided in Section 3), permit
the granting of options at less than 100% of fair market value at time of
grant, or change the class of employees eligible to receive options under this
Plan. No amendment of this Plan may, without the consent of the holder of an
existing option, adversely affect his rights thereunder.
GENERAL SIGNAL CORPORATION
1981 STOCK OPTION PLAN*
1. Purpose
The purpose of this Plan is to offer as an additional incentive to
the officers and other key employees most responsible for the growth and
success of General Signal Corporation (the "Corporation") the opportunity to
increase their proprietary interest in the Corporation under conditions which
will encourage their continued employment in the service of the Corporation.
2. Administration
This Plan shall be administered by a Committee of not less than
three (3) members appointed annually by the Board of Directors. The
Committee, which may but need not be the Compensation Committee, shall be
composed of members of the Board of Directors who are not eligible to receive
options under this Plan. The Committee shall act by a majority vote or by a
written statement signed by a majority of the members. Subject to the express
provisions of this Plan, the Committee shall determine the individuals to
whom, and the time or times at which options shall be granted, the number of
shares to be subject to each option, the period of each option and other terms
and conditions thereof.
3. Stock Subject to Plan
The shares to be issued upon exercise of options granted under this
Plan shall be made available, at the discretion of the Board of Directors,
either from the authorized but unissued shares of Common Stock of the
Corporation or from shares of Common Stock reacquired by the Corporation,
including shares purchased in the open market.
Subject to the provisions of the next succeeding paragraph of this
Section 3, the aggregate number of shares of Common Stock for which options
may be granted under this Plan shall not exceed 1,600,000 shares.
If, prior to the termination of this Plan, an option granted under
this Plan shall expire, be cancelled or terminate for any reason without
having been exercised in full, the unpurchased shares shall again become
available for option under this Plan, except as otherwise provided in
paragraph 7. In the event that the number of outstanding shares of Common
Stock of the Corporation shall be changed by reason of split-ups or
combinations of shares or recapitalization or by reason of stock dividends,
the number of shares for which options may thereafter be granted under this
Plan, the number of shares then subject to options theretofore granted under
this Plan and the price per share payable upon exercise of such options, shall
be appropriately adjusted as determined by the Board of Directors so as to
reflect such change. Options may also contain provisions for their
continuation or for other equitable adjustments after changes in shares of
Common Stock resulting from reorganization, sale, merger, consolidation or
similar occurrence.
4. Eligibility and Participation
Options may be granted only to officers and other key employees of
the Corporation and of its subsidiaries, present and future. A director of
the Corporation or of a subsidiary who is not also an officer or other key
employee of the Corporation or of one of its subsidiaries, will not be
eligible.
5. Option Prices
The purchase price of the Common Stock under each option shall be
not less than 100% of the fair market value of the stock on the date the
option is granted. The purchase price is to be paid in full upon the exercise
of the option, and payment shall be made in cash, or by check, bank draft or
money order payable to the order of the Corporation, or, with the approval of
the Committee, by delivering shares
of Common Stock of the Corporation of equivalent fair market value
on the date the option is exercised. Fair market value shall be the closing
price on the New York Stock Exchange or, in the event that no sale shall have
taken place, the mean between the closing bid and asked prices.
If the Committee grants any incentive stock options, within the
meaning of Section 422A of the Internal Revenue Code, the aggregate fair
market value, determined as of the time such option is granted, of the shares
for which such options may be granted to any one employee in any calendar year
(under this Plan and any other plan which is maintained by the Corporation or
its subsidiaries and which provides for the granting of such options) shall
not exceed $100,000 plus any unused limit carryover to such year, as
determined under Section 422A of the Internal Revenue Code.
6. Form of Option
Options granted pursuant to this Plan shall be evidenced by Stock
Option Agreements in such form as the Committee shall from time to time adopt.
Options may, but need not, be subject to such terms and conditions as will
qualify their holders for special Federal income tax treatment pursuant to any
provision of the Internal Revenue Code of 1954 as may be enacted from time to
time. Each option granted under this Plan shall be exercisable on such date
or dates and during such period and for such number of shares as shall be
determined pursuant to the provisions of the Stock Option Agreement with
respect to such option; provided, however, that no option shall be exercised
earlier than one year or later than ten years and one day from the date of
grant of the option. In any event, all options granted hereunder shall
terminate and expire upon the first to occur of the following events:
(a) the termination date specified in the option agreement; (b) the
expiration of three (3) months from the date an optionee ceases to be employed
by the Corporation or its subsidiaries other than by reason of death or
retirement; provided, however, the Committee may permit an additional period
of up to five years to exercise an option from the date an optionee ceases to
be employed involuntarily by the Corporation or its subsidiaries by reason of
the sale or other disposition of a subsidiary or a division; (c) the
expiration of five (5) years from the date an optionee ceases to be employed
by the Corporation or its subsidiaries by reason of retirement in accordance
with the terms of a pension plan maintained by the Corporation or a
subsidiary, or the expiration of one year from such retiree's death, whichever
is later; and (d) the expiration of one (1) year from the date of an
optionee's death if his death occurs at a time when the optionee is in the
employ of the Corporation or a subsidiary.
After termination of employment for any reason, an Optionee, or his
legal representative, may exercise, subject to the above time limitations,
only that portion of his option which he has a right to exercise on such date
of termination unless the Stock Option Agreement specifically allows a greater
portion of the option to continue to become exercisable within such time
limitations.
7. Compensation in Lieu of Exercise
Upon written application of an optionee, the Corporation may, with
the approval of the Committee, substitute for the exercise of an option,
compensation to the optionee not in excess of the difference between the
option price and the fair market value, determined in accordance with Section
5 of this Plan, of the shares covered by such written application as of the
date thereof. Such compensation may be in cash or shares of Common Stock of
equivalent fair market value, or both, as the Committee may determine. In the
event compensation is substituted pursuant to this paragraph 7 for the
exercise, in whole or in part, of an option, the option shall be reduced by
the option shares for which such compensation is substituted and such shares
shall not again be available for option under this Plan. Notwithstanding
anything to the contrary contained herein, for the purpose of determining the
difference between the option price and the fair market value to optionees who
are subject to the provisions of Section 16b of the Securities Exchange Act of
1934, and who request such substitution during "window periods" specified by
Rule 16b-3 promulgated thereunder, the Committee may determine that there be a
single fair market value for the Corporation's common stock for each such
"window period", being the average closing market value for the Corporation's
common stock during such "window period".
8. Non-Transferability of Option
No option granted under this Plan shall be transferable otherwise
than by Will or the laws of descent and distribution and an option may be
exercised during the lifetime of the holder thereof, only by him.
9. Effective Period of Plan
This Plan shall become effective upon the date of its approval by
the stockholders of the Corporation. Unless earlier terminated by the Board
of Directors, this Plan shall terminate April 18, 1986, but such termination
shall not affect options issued prior thereto.
10. Amendment of Plan
The Board of Directors of the Corporation may from time to time make
such amendments of this Plan as it shall deem advisable; provided, however,
that the Board of Directors may not, without further approval of the holders
of a majority of all outstanding shares of the Corporation entitled to vote
thereon, increase the maximum number of shares as to which options may be
granted under this Plan (except as otherwise provided in Section 3), permit
the granting of options at less than 100% of fair market value at time of
grant, or change the class of employees eligible to receive options under this
Plan. No amendment of this Plan may, without the consent of the holder of an
existing option, adversely affect his rights thereunder.
* As Amended and Restated - July 7, 1993
At a Glance
As shown below, General Signal introduced a broad range of
competitive new products in 1993 to meet the changing needs of customers and
enhance its position as a leading manufacturer of equipment nad instruments
for the process control, electrical, and industrial technology industries.
Process Controls
Aurora Pump
North Aurora, Illinois
Cleive C. Dumas, President
Products Centrifugal, submersible, regenerative turbine, and
vertical turbine pumps.
Markets Municipal and residential water and wastewater treatment;
commercial heating, ventilation, and air conditioning; agriculture.
DeZurik
Sartell, Minnesota
Michael Schnabel-Kuehn, President
Products Industrial valves that start, stop and throttle gases,
liquids, dry solids, and slurries; consistency transmitters.
Markets Process industries, including chemical, petroleum, and
minerals processing, pulp and paper manufacturing, air conditioning,
industrial and municipal water and wastewater treatment, electric utilities.
Kinney Vacuum
Canton, Massachusetts
Kurt R. Bramer, President
Products Mechanical vacuum pumps and pump packages.
Markets Food processing and packaging, chemical and pharmaceutical
processing, electrical manufacturing and service, specialty metals processing,
heat treating, and other manufacturing industries.
Leeds & Northrup
North Wales, Pennsylvania
Samuel E. Park, President
Products Electronic measurement and control instruments, devices,
systems, and sensors.
Markets Process industries, including electric power, steel, glass,
cement, fabricated metals, food and beverages, pharmaceutical, chemical, and
appliance manufacturing; heating, ventilation, and air conditioning.
Lightnin
Rochester, New York
Horst P. Engelbrecht, President
Products Industrial fluid mixers, agitators, and coal feeder
equipment.
Markets Process industries, including chemical, petroleum, minerals
processing, food and beverage, and pharmaceutical manufacturing; industrial
and municipal water treatment and supply; electric utilities.
Revco/Lindberg
Asheville, North Carolina
Daniel B. Dawley, President
Products Ultra-low temperature laboratory freezers, refrigerators,
and CO2 incubators; industrial and laboratory ovens and furnaces.
Markets Life science and industrial laboratory research, primary and
fabricated metals processing, electronic equipment processing.
Electrical Controls
Dielectric Communications
Raymond, Maine
James J. Beville, President
Products Radio frequency transmission and pressurization equipment
and systems.
Markets Broadcasting, telecommunications, government.
GS Building Systems Corporation
Farmington, Connecticut
Timothy J. Mellen, President
Products Fire detection systems, low-voltage systems service,
emergency lighting, exit signs, signaling devices, and flexible wiring
systems.
Markets Commercial, industrial, and institutional construction.
GS Electric
Carlisle, Pennsylvania
Michael R. Jacqmin, President
Products Universal, blower, and permanent magnet fractional
horsepower electric motors.
Markets Consumer appliance manufacturing and commercial
applications.
O-Z/Gedney
Farmington, Connecticut
W. Scott Butler, President
Products Electrical conduit and cable fittings, enclosures and
controls, industrial lighting, heat trace systems, and firestop products.
Markets Nonresidential and nonbuilding construction, large
processing industrials.
Sola Electric
Elk Grove Village, Illinois
Michael J. Cheshire, President
Products Uninterruptible power systems, DC power supplies, power
conditioniers/regulators, low- voltage general purpose transformers, medium
power transformers, and transformer remanufacturing/decommissioning services.
Markets Computer and electronic equipment manufacturers and users,
electric utilities, and factory automation.
Industrial Technology
Telecommunications Equipment
Tau-tron
Westford, Massachusetts
Kenneth E. Tingley, President
Products Performance monitoring and test equipment for
telecommunications networks.
Markets Telecommunications service providers and network operators
worldwide.
Telenex Corporation
Mount Laurel, New Jersey
Robert Coackley, President
Products Data communications network management, control, and
diagnostic equipment.
Markets Data centers at industrial corporations, banking and
financial service organizations, and other data communications network
operators or users.
Auto and Transit Equipment
GFI Genfare
Elk Grove Village, Illinois
James A. Pacelli, President
Products Electronic fareboxes, turnstiles, and vending equipment.
Markets Mass transit systems and federal government agencies.
Metal Forge
Dublin, Ohio
Henry G. Anzuini, President
Products Cold-forged solid and tubular metal components and
assemblies for automobiles and bicycles.
Markets Automotive and bicycle manufacturers and tier-one suppliers
to these manufacturers.
1993 -- a record year for new products.
Aurora Pump Low-Flow, High-Head Sewage Pump
DeZurik AccuTraxTM Blade Consistency Transmitter
Kinney Vacuum Liquid Ring Vacuum Pump
Leeds & Northrup Dew Point Transmitter
Lightnin MagMixerTM
Revco/Lindberg Blue M Convection Oven
Dielectric DigiTLineTM HDTV-ready Transmission Line
GS Building Systems Corporation Dual-Lite E-Z Snap LED Exit Sign
GS Electric Permanent Magnet Treadmill Motor
O-Z/Gedney Tek-MateTM Cable Terminator
Sola Electric 70 Uninterruptible Power System
Tau-tron 45 mbit/second Monitor Card
Telenex Corporation 2700 LAN/WAN Switching System
GFI Genfare Postal Service Stamp Vending Machine
Metal Forge Steering Center Link
Net Sales Net Operating Earnings(1)
(Dollars in millions) (Dollars in millions)
Process Controls $722 $71
Electrical Controls $547 $40
Industrial Technology $261 $45
(1)Excludes note (1), page 31
Process Controls
Despite soft markets for process controls products, particularly
internationally, the sector improved its margins as units introduced new
products and improved their productivity to position themselves for long-term
growth.
Lightnin enhanced its worldwide market leadership position in 1993
by reorganizing its operations to set new industry standards for quick
delivery and customer responsiveness. The unit's investment in highly
flexible equipment enabled it to shrink product delivery cycles and
consolidate its manufacturing operations, making Lightnin one of General
Signal's most advanced manufacturing unit. The effort solidifies Lightnin's
position as the leading mixer manufacturer in the world.
Capitalizing on a growing need among manufacturers to eliminate
emissions, Lightnin developed a new family of top-entering seal-less mixers
for use in the pharmaceutical, biotechnology, and chemical industries.
Delivery of the mixer is scheduled to begin in 1994.
Lightnin's Vektor portable mixer, introduced in 1992, won Chemical
Processing magazine's 1993 Vaaler award for outstanding process equipment
design. The product's modular design and corrosion-resistant composite
impeller allow it to adapt to a wide range of applications.
Efforts to expand Lightnin's international presence were successful
in many parts of the world. The unit saw high activity in Latin America and
the Pacific Rim countries. Lightnin's Stock Equipment division concluded a
joint venture agreement with Shanyang Power Equipment Company, a Chinese
company, to manufacture and market coal feeder systems in China, will be built
over the next five years.
Approximately 40 percent of Lightnin's total sales now come from
outside the U.S. In 1993, the U.S. Department of Commerce made Lightnin one
of the few American companies to receive its prestigious E Award, which
recognizes businesses that achieve a major increase in exports.
Leeds & Northrup experienced another challenging but productive year
as the unit continued to reduce its cost structure while developing
competitive new sensors and information management products for the process,
heating, ventilation, and air conditioning, and electric utilities markets.
As a result of a restructuring aimed at cutting costs and improving
customer value, the unit to began to shift its product manufacturing
operations to a more efficient facility in Clearwater, Florida and plans to
close a significant portion of its North Wales, Pennsylvania plant in 1994.
Leeds & Northrup continued to lead the liquid analysis field, as
demand increased in the process industries for its patented DurafetTM pH
monitor. Chemical Processing magazine awarded Durafet its 1993 Vaaler award
for contributing to the more efficient and effective operation of chemical
processing plants.
Leeds & Northrup's patented Dew Point Transmitter, initially
introduced to the heating, ventilation, and air conditioning market this year,
also showed promise for process applications. Designed to resist fouling and
operate at higher temperatures than other currently available technology, the
transmitter allows manufacturers to measure the moisture and temperature of
gases directly. The result is faster, more precise monitoring of smokestack
emissions and control of drying, refining, and evaporating. This product will
be introduced to the process market in 1994.
New product developments, combined with a continued focus on Leeds &
Northrup's more profitable lines of business and cost cutting, are aimed at
improving the unit's profitability.
Sales for DeZurik valves continued to reflect slow growth in
domestic and foreign markets, particularly within the paper and pulp industry.
As part of an overall effort to improve its competitive position and respond
to customer needs more quickly, DeZurik restructured its operations into
strategic business units, reduced headcount, and consolidated manufacturing
into its two largest facilities, which have been transformed into focused
factories.
DeZurik enhanced its position as a leading supplier to the paper
industry, increasing sales of its redesigned V-Port Ball valve and
successfully launching the AccuTraxTM electronic blade consistency
transmitter, which reduces operating costs by more accurately measuring pulp
stock consistency.
In the wastewater market, DeZurik maintained its leading share of
the market for eccentric plug valves, winning a new contract for Miami's Dade
County wastewater treatment facility.
DeZurik's strategic restructuring strengthens the unit's position as
a global supplier of high- quality valves and prepares Dezurik to capture a
larger share of the world market.
The acquisition of Revco Scientific and its immediate integration
with General Signal's Lindberg unit expanded the unit's presence in the
rapidly growing research laboratory equipment market, adding a complete line
of ultra-low temperature freezers, refrigerators, and CO2 incubators. Revco
is best known for its ultra-low temperature freezer, which is designed to
maintain uniform temperatures and operate reliably over long periods.
The combination of the two businesses, which created a new unit
named Revco/Lindberg, allowed General Signal to consolidate its laboratory
equipment manufacturing operations, close a Lindberg plant of similar size to
Revco's main manufacturing facility, and expand the unit's international
sales.
Although Revco/Lindberg's traditional heat processing businesses
continued to face difficult industrial markets, the trend toward lighter
weight metal parts and a more robust automotive market resulted in new orders
for Revco/Lindberg aluminum melting and holding furnaces from U.S. and
Japanese automotive manufacturers.
Aurora Pump expanded its offerings to the municipal water and
wastewater treatment and original equipment markets and grew its share of the
commercial heating, ventilation, and air conditioning business, which resulted
in higher sales and earnings.
The introduction of a new energy-saving pump, designed to boost the
transmission of wastewater from remote areas to central sewage treatment
facilities, helped to improve the unit's share of the municipal water and
wastewater market.
As part of a strategic effort to strengthen its position in the
original equipment market, Aurora introduced two new pumps for boiler feed
applications that allow manufacturers to lower the cost of their products.
Aurora increased its share of the commercial market, hitting a
five-year high in bookings for fire protection and air conditioning pumps.
Following the 1993 bombing of New York City's World Trade Center, Aurora
received the emergency contract to provide pumps for temporary chilled water
systems to World Trade Center offices, allowing repairs to be made to the
building's central energy plant during the summer.
The acquisition of Layne & Bowler, a manufacturer of vertical
turbine pumps, expanded Aurora's product line and sales organization,
positioning the company as the nation's leading pump supplier to the municipal
market. The acquisition provides new channels for Aurora and Hydromatic
products in agriculture and water treatment and improves Aurora's presence in
international markets. In addition, Aurora will benefit from consolidating
its operations and distribution network.
Kinney Vacuum continued to penetrate the food-processing and
packaging market, as more customers chose the unit's Triplex rotary piston
vacuum pumps to speed production and improve quality. Sales to this market
niche increased 50 percent in 1993 and should expand as Kinney targets
original equipment manufacturers of food processing and packaging machinery.
The introduction of a line of mid-sized liquid ring vacuum pumps
this year made Kinney the only domestic manufacturer of this type of pump,
used in chemical processing, pharmaceutical, food processing, and
manufacturing industries. The product should be a nice plus for Kinney in
1994.
Sector improvements in operating efficiency and a continued
aggressive product introduction effort, combined with an improving economic
climate, should result in increased returns for the Process Controls sector in
1994.
Photocaptions:
Layne & Bowler's 250 horsepower vertical pumps are designed to move
large quantities of liquid quickly at wastewater treatment centers such as
this one in New Jersey.
Researchers at Memorial Sloan-Kettering Cancer Institute in New York
City count on Revco ultra-low temperature freezers to preserve cell specimens
reliably.
Lightnin's new seal-less MagMixerTM, being readied here for
shipment, seals in fluids while sealing out contaminants and emissions during
the processing of pharmaceutical, chemical, and biotechnology products.
1993 1992 1991
Process Controls
Revenues 722 739 696
Operating Earnings* 70.9 70.0 62.4
*Excludes note (1), page 31
Dollars in millions
Electrical Controls
The Electrical Controls sector faced a challenging year, as sales
gains for fire alarm controls and electrical fittings could not offset the
impact of a weak European economy on three-phase uninterruptible power
supplies, low domestic demand for power transformers, and reduced demand for
vacuum cleaner motors. However, new product introductions, reduced inventory
levels, and lower operating costs began to improve the sector's performance by
year end.
In an initiative to improve its access to new markets and expand the
effectiveness of its sales and distributor network, General Signal's Edwards
unit repositioned its businesses under a new entity, GS Building Systems
Corporation. The repositioning allows the unit to focus its product design
and manufacturing operations for greater efficiency and reduced cost, while
providing customers with a single source for building life safety, fire
protection (Edwards Systems Technology--EST), emergency lighting (Dual-Lite),
and signaling (Edwards) products and service.
The unit enhanced its leading share of the industrial signaling
market in North America by expanding its line of audible and visual signals
for use in hazardous locations, high decibel electronic signals for industrial
applications, and strobes for commercial, industrial, and institutional
settings.
EST, which supplies the most technologically advanced integrated
life safety products in the industry, led the unit in sales. Three new Las
Vegas hotels that opened this year -- the MGM Grand, The Luxor, and Treasure
Island -- all chose EST for their fire protection needs.
EST's ability to offer solutions for the most complex applications
made it the fire protection system of choice for two new technically demanding
building complexes: Denver International Airport and the University of
California, San Francisco campus.
The combination of energy savings, long life, and easily installed
products, sold under the Dual-Lite trade name, helped increase the unit's
market share of emergency lighting and exit signs. Innovative and
energy-efficient upgrades to the unit's light emitting diode (LED) exit signs
were in high demand by commercial and institutional markets.
In order to strengthen the product mix of its Sola Electric unit
while significantly reducing its cost structure, General Signal consolidated
the three transformer businesses of the former Hevi-Duty unit into Sola.
Following the integration, Sola streamlined its operations, exiting its
Canadian lighting ballast business and closing its Florida transformer
decommissioning facility.
A transition to focused factories in North America helped Sola
reduce inventory by 17 percent while improving customer service. The unit's
reorganized sales and marketing team is now targeting selected power
protection, conversion, and transformation markets.
Domestic demand for power transformers continues to be weak and
significant industry overcapacity has resulted in sharply falling prices.
Sola uninterruptible power supply products faced difficult European
markets during 1993 but continued to sell well to the company's U.S. retailing
industry segment. The unit's popular Advanced Network Plus system, designed
to handle the retail store environment, won PC Magazine's 1993 Editor's Choice
award for the best uninterruptible power supply system in the industry.
In addition, Sola began shipments of uninterruptible power supply
products with new "autoranging" technology to a major original equipment
manufacturer, which provides customers with a product that can be used with
varying voltages throughout the world.
Sola was also chosen to provide three-phase uninterruptible power
system products for back- up power at the 1994 Winter Olympics, held in
Lillehammer, Norway.
O-Z/Gedney continued to maintain its position as a leading supplier
to the nonresidential and nonbuilding construction industries. Following the
integration of the heat trace and firestop businesses of General Signal's
former Hevi-Duty unit, O-Z/Gedney realigned its resources behind five key
product lines: electrical fittings, industrial lighting, enclosures and
controls, heat trace, and firestop products. In addition, O-Z/Gedney made
significant capital investments to upgrade its foundry operations to
world-class standards and improve productivity and service.
To further enhance its ability to bring new products to market
faster, O-Z/Gedney invested in a computer-generated rapid prototyping system.
The new system sharply reduces new product design iteration and production
start-up time and complements a broader quick-to-market product development
initiative for the unit's fittings business. This effort has resulted in the
accelerated introduction of many new products and product improvements.
Stronger enforcement of building codes and greater concern for life
safety contributed to strong sales for O-Z/Gedney's firestop products.
Additional efforts to solidify international partnerships for heat
trace products boosted European and Canadian sales despite difficult economic
conditions. Sales for the unit's industrial and hazardous lighting business
increased, while its enclosure and control product sales were sluggish as
capital spending in the petrochemical industry remained low.
While the nonresidential and nonbuilding construction markets are
not expected to be robust in the near future, O-Z/Gedney's improved
competitive ability, combined with the formation of selective distribution
partnerships, an added emphasis on expanding the unit's Pacific Rim and Latin
American business, and its customer-driven focus, have positioned the unit for
continued growth.
As a major supplier of fractional horsepower motors for consumer
appliances, GS Electric increased its sales again in 1993 by responding
rapidly to its customers' needs. GS Electric motors are competitively priced,
designed, and built according to rigid quality standards and delivered within
demanding time frames.
An industry leader in motors for floorcare products, GS Electric
continued to grow its share of sales to original equipment manufacturers at a
time when some major product categories were leveling off or declining. GS
Electric's motors were included in a new wet/dry utility vacuum, a new carpet
steam cleaning model, and a new stick broom vacuum successfully launched by
major floor care appliance manufacturers. A new plant focused on the
production of floor care appliance motors opened early in 1993, expanding the
unit's manufacturing capacity in response to increasing demand.
GS Electric broadened its share of the growing home exercise
equipment market as a health- conscious public and aggressive telemarketing of
exercise equipment raised demand and manufacturers introduced new products
using GS Electric motors.
The unit also experienced growth in the yard and garden market,
where it enjoys a leading position. While the market for its motors is highly
price sensitive and ample competitive capacity exists, GS Electric's
reputation as a responsive supplier will continue to benefit the unit.
Dielectric Communications continued to invest in maintaining its
position as a leading supplier of broadcast equipment.
Anticipating the need for equipment that can accommodate high
definition television signals, Dielectric introduced a revolutionary new
television transmission line that allows broadcasters to upgrade their
standard television broadcast equipment. The new line is compatible with both
traditional and high definition television signals. Maryland Public
Television will become the first television station to install the system
early in 1994.
Dielectric also introduced the first HDTV-ready filters for the next
generation of television transmitters, allowing broadcasters to upgrade their
systems.
Finally, a new contract for dehydrators for Telekom Malaysia's
telephone system helped expand the unit's reach beyond the United States.
Improvement in the sector's operating efficiency and a continued
focus on niche markets that are growing, combined with a slight improvement in
the international economy, should result in improving returns for the sector
in 1994.
Photocaptions:
O-Z Gedney's new rapid prototyping equipment now allows the unit to
bring cost-effective, competitive product ideas to customers in hours rather
than months.
Las Vegas' new Luxor hotel uses a sophisticated fire protection
system from Edwards Systems Technology to protect visitors to the hotel's
200,000 square foot casino, 2,500 guest rooms, and family-style entertainment
complex.
GS Electric expanded sales of its permanent magnet motors in 1993,
becoming the exclusive supplier for a popular new line of treadmills from
Proform Fitness Products, Inc.
1993 1992 1991
Electrical Controls
Revenues 547 568 515
Operating Earnings* 39.7 43.1 43.9
*Excludes note (1), page 31
Dollars in millions
Industrial Technology
The Industrial Technology sector, which previously included General
Signal's divested semiconductor equipment operations, reflected the strength
of the remaining operations. The sector's operating margins of 17.2 percent,
achieved on good sales growth, were the best in the company.
Tau-tron continued to provide diagnostic and test systems and
instruments to meet the rapidly changing services and demands of the
telecommunications industry. The unit won significant follow-on business from
Singapore Telecom with its Integrated Monitor and Test System (IMATS ) 9001
performance monitor and test product line. Product enhancements positioned
the line for further growth and helped Tau-tron penetrate several new domestic
and international accounts. The unit's extension of IMATS to its SAS analog
circuit access and test system product line was well received by Tau-tron's
established customer base as an upgrade and migration path to digital
services.
The ongoing partnership with AT&T led to record sales of Network
Channel Office Equipment, as this key customer expanded its network and
services. Tau-tron is able to respond quickly to AT&T's latest needs with
products and services of the highest reliability and quality.
Telenex Corporation enjoyed significant sales and earnings growth
during the year for its matrix switch, diagnostic, and technical control
products for the data communications industry.
The unit solidified its position as the foremost supplier of matrix
switching equipment with the introduction of its 2700 LAN/WAN Switch.
Positioned at the mid-to-high end of the intelligent port-switching hub
market, the new system allows users to manage local and wide area networks and
terminal-to-host connections through one switching system.
Telenex was also successful in establishing a customer base for the
7-VIEWTM Surveillance System, which detects early trends in telecommunication
signaling networks and allows managers to anticipate problems. The unit
continued to strengthen its position as a supplier of a broad line of
diagnostic test equipment, and its INTERVIEW 8000 series protocol analyzers
have become the most widely used devices for testing emerging broadband and
data services, such as Frame Relay and SMDS.
Metal Forge was well positioned to benefit from the upswing in
automotive sales during the year, as its products are used on many popular
vehicles. For example, sales of suspension arm assemblies for GM light trucks
increased by 11 percent over 1992.
The unit was also able to increase its market share through the
introduction of new products, such as a radius rod used on a redesigned
compact car produced in the U.S. by a foreign auto manufacturer.
Steady improvement in all phases of the unit's manufacturing
operations have helped to maintain Metal Forge's longstanding reputation as a
competitive supplier of high quality parts. This year, the unit won new
quality awards from the automotive industry, including Honda's North America
BP award, The Chrysler Pentastar Award for Supplier Excellence, and the
Chrysler Quality Excellence Award in 1993.
In its first full year in the automotive service sector through its
Ryken manufacturing division, the unit was able to increase both its product
line and its customer base, preparing the way for future sales increases.
1993 was also a good year for Metal Forge in the domestic bicycle
market, with sales to this sector up almost 10 percent over 1992.
GFI Genfare, General Signal's transit revenue control business,
enjoyed strong sales to domestic mass transit systems. The unit's core
product, the electronic registering farebox, has set and maintained the
standard for the industry since its introduction in 1980. GFI captured all
new major contracts for bus fare collection systems this year from the state
of Connecticut, Honolulu, New Orleans, and San Antonio, as well as a contract
for vending equipment from Boston. In addition, GFI shipped fare collection
equipment to Boston, Chicago, Cincinnati, Cleveland, Los Angeles, Miami,
Minneapolis, and Seattle.
GFI continued to build on a substantial customer base with its
add-on product, the Ticket Reader/Issuer Machine (TRiMTM) magnetic document
processor. Seventy-five percent of the major bus contracts awarded in 1993
included TRiMs, and GFI expects to increase the number of TRiMs in active
revenue service in North America as demand grows in 1994.
Work on the unit's newest product, a stamp vending machine for the
U.S. Postal Service to begin delivery in 1994, progressed on schedule for
initial delivery in 1994.
Growing demand in the automotive, transit, and telecommunications
markets should continue to benefit the sector, as its businesses use their
leading positions to build sales and earnings in 1994.
Photocaptions:
IBM's Business Recovery Services relies on the large port-capacity
and connectivity capabilities of the Telenex 2700 Mega-Matrix switch to
provide subscribers with reliable access to computing and communications
equipment.)
GFI used an established base of more than 42,000 bus fareboxes to
build sales for its add-on product, the Ticket Reader Issuer Machine (TRiM),
in 1993.)
1993 1992 1991
Industrial Technology
Revenues 261 233 213
Excludes divested semiconductor equipment operations
Dollars in millions
Operating Earnings 44.8 32.9 24.2
Excludes divested semiconductor equipment operations
Dollars in millions
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following discussion should be read in conjunction with the
company's consolidated financial statements and notes thereto.
Results of Operations
During 1993, the company reported earnings before extraordinary
charges and cumulative effect of accounting changes of $66.6 million
(or $1.47 per share), compared with $12.5 million (or $0.30 per share)
during 1992. Results for 1993 and 1992 were affected by the
divestiture of the semiconductor equipment operations (SEO),
restructurings, asset valuations, charges related to previously
divested businesses, the adoption of three new accounting standards,
extraordinary charges, and the charges related to the Revco pooling of
interests transaction. The year-to-year discussions address results
of operations on an analytical basis.
The table below presents results of operations on a reported basis
under generally accepted accounting principles compared to operations
excluding the effect of the above one-time items. After the table is
a brief explanation of the one-time items.
1993 1993 Analytical 1992 1992 Analytical
Year Ended Reported Analytical(1) Percent Reported Analytical(1) Percent
December 31
(In thousands, except
per share data)
Net sales $1,530,006 $1,530,006 $1,674,205 $1,539,354
Gross margin 429,416 451,916 29.5% 468,583 452,083 29.4%
Selling, general
and admistrative
expenses 308,370 308,370 20.2% 339,818 316,311 20.5%
Operating
earnings 110,946 143,546 9.4% 43,165 135,772 8.8%
Earnings from continuing
operations $66,596 $88,730 5.8% $12,465 $75,835 4.9%
Earnings per share
of common stock from
continuing
operations $1.47 $1.96 $0.30 $1.82
(1) Excludes the effect of items discussed below.
SEO: Effective October 1, 1992, SEO was treated as divested and its
results were no longer included in operating earnings. During the
fourth quarter of 1992, the company recorded a charge of $85.6 million
($58.2 million after tax) to provide for losses on sales, estimated
future operating losses, severance, and idle facilities, all relating
to SEO, and related restructuring that will affect the company's
overall systems and infrastructure. During the first nine months of
1992, SEO reported sales of $135 million compared with $180.2 million
for the full year 1991. During 1993, the company substantially
completed the divestiture of SEO with higher than expected proceeds
from the sale of these units and lower than expected severance costs.
As a result, $53.2 million of excess reserves were returned to
operating income. During 1993, the company made cash outlays of
approximately $38.4 million related to SEO, and received $98 million
of cash from the sale of SEO.
Restructurings: In 1993, the company provided $30.5 million for
factory consolidation and rearrangement ($20.9 million), product
restructuring and realignment ($6.8 million), and reorganization of
lines of distribution and administration ($2.8 million), and expects
that these activities will be completed during 1994. Approximately $17
million of cash outlays related to this charge were made during 1993.
Among other actions, headcount was reduced by approximately 800, and
management anticipates lower future costs principally from higher
productivity.
Asset Valuations: Also during 1993, the company provided a $22.5
million charge in cost of sales to reflect the results of a continuing
review of world-wide assets to identify any permanent declines in the
value of assets.
Previously Divested Businesses: The company recognized in 1993 an
additional $19.6 million charge for valuation of assets and
liabilities and for other matters related to the remaining portion of
the discontinued operations and other divested businesses. This
charge is included in operating earnings as more than one year has
passed since the decision was made to divest these businesses.
Adoption of New Accounting Standards: The company adopted SFAS nos.
106, "Employers' Accounting for Postretirement Benefits Other Than
Pensions" and 109, "Accounting for Income Taxes," effective January
1, 1992. The company adopted SFAS 112, "Employers' Accounting for
Postemployment Benefits," effective January 1, 1993. Prior year
financial statements were not restated. The impact of adopting these
standards (shown as the cumulative effect of accounting changes in the
statement of earnings) were non-cash, after-tax charges of $25.3
million in 1993 and $92.4 million in 1992.
Extraordinary Charge: The company extinguished certain high-rate debt
using the proceeds from the sale of 4.1 million shares of common stock
and the sale of SEO during 1993. This extinguishment resulted in an
extraordinary charge of $6.6 million.
Revco Transaction: The acquisition of Revco was accounted for as a
pooling of interests, and 1993 and 1992 financial statements have been
restated accordingly. The impact on 1991 was not material. The company
recorded a charge of $13.2 million primarily for transaction costs and
for consolidation of its Lindberg unit with Revco.
1993 Compared with 1992 (Analytical)
Revenues
Sales were flat at $1.53 billion for both years. A 3.8 percent
increase in domestic sales was offset by international and export
sales that declined 17.6 percent in 1993. International and export
sales were hurt by a generally stronger U.S. dollar and weakened
economies in Europe and in Asia, especially Japan.
Sales in the Process Controls sector were $721.6 million, down 2.4
percent from $739 million in 1992 primarily from softer international
demand for short-term systems projects and the divestiture of several
non-strategic product lines. Partially offsetting these declines were
sales of $2.7 million from the company's acquisition of Layne & Bowler
late in 1993.
In the Electrical Controls sector, sales were $547.1 million, down 3.6
percent from 1992 sales of $567.5 million. Only partially offsetting
this decline were strong domestic and international shipments of fire
safety controls products. A significant portion of the decline is
attributable to the sale of Sola's Canadian lighting ballast business
($12 million), declines in orders for electric motors used in floor
care products, lower international demand for uninterruptible power
systems, and lower sales of hazardous location equipment and medium
power transformers.
Sales in the Industrial Technology sector of $261.3 million were up
12.2 percent from $232.8 million in 1992, reflecting increased demand
for truck products and the impact of the Ryken acquisition made in
1992. Transit equipment sales also improved in 1993 as several large
municipal transit authorities accepted large shipments of turnstiles,
TRiMTM fare collection equipment, and token and ticket vending
machines. The continued success of the matrix switch product line and
other telecommunications products also helped to boost the sales
gains.
Costs and Expense
Gross margins were flat as a percentage of sales reflecting the
continued pricing pressures experienced by the company and the
offsetting cost control measures that were taken earlier this year,
including the impact of the restructuring activities and a change in
postretirement benefits that reduced annual expense from $14.7 million
in 1992 to $6.1 million in 1993. In addition, the company realized
$6.7 million of LIFO reserve liquidations in 1993 and $7 million in
1992 as a result of aggressive inventory management and product cost
reduction programs.
The ratio of selling, general and administrative expenses to sales
improved to 20.2 percent over year ago levels of 20.5 percent
primarily from continued cost control efforts. Included in 1993
selling, general and administrative expense is $1.7 million for the
incremental cost of SFAS 112, principally related to severance
benefits. Severance payments made during 1993 amounted to $8.2
million and were charged to the SFAS 112 obligation.
The company recognized pension credits in operating earnings of $10.7
and $16.1 million in 1993 and 1992, respectively. These credits
resulted from the overfunded pension plan and favorable investment
results. While the company expects to be able to record pension
credits in 1994, a number of factors can affect the amount of such
credits, including investment returns and interest rates.
Spending on research and development at the company's operations
remained consistent as a percentage of sales at 4.2 percent in 1993
and 4.7 percent in 1992. This reflects the company's continued focus
on enhancing its core product lines.
Net interest expense of $16.5 million decreased during 1993 from 1992
interest of $24.4 million because of the extinguishment of higher rate
debt as a result of the equity offering and proceeds from the sale of
SEO and lower interest rates.
The effective income tax rate for 1993 was 29.5 percent compared with
33.6 percent for 1992. This reduction was due to the reversals of tax
reserves and an increase in the company's deferred tax assets arising
from 1993 tax legislation.
Earnings, on an analytical basis, improved to $88.7 million or $1.96
per share for the year, a 17 percent improvement over 1992 comparable
results of $75.8 million or $1.82 per share. This improvement was led
by continued cost control efforts.
1992 Compared with 1991
Sales were slightly higher at $1.674 billion in 1992 compared with
$1.616 billion in 1991. Sluggish markets and pricing pressures in
chemical, pulp and paper and minerals industries, and in
nonresidential construction hampered sales growth during the period.
Process Controls sales were $739 million, up 6 percent from 1991. 1992
acquisitions, including Revco, added approximately $58.5 million to
1992 sales. The company sold several product lines within the mixing
and valve businesses during 1992 and experienced price pressures,
particularly on large project orders. Sales increased in municipal
markets, especially water treatment projects.
In the Electrical Controls sector, sales were $567.5 million, up 10%
from $515.4 million in 1991. 1992 acquisitions accounted for
approximately $33 million of the increase. Edwards benefited from
acquiring FAST (Fire Alarm and Systems Technology, Inc.) early in the
second quarter of 1992. Sola Electric completed the acquisition of
ABB's uninterruptible power supply business early in 1992. GS Electric
sales increased as a result of higher demand for small electric motors
for floor care, garden and exercise equipment.
Within the Industrial Technology sector, excluding SEO for the first
nine months of 1992 and all of 1991, sales for the sector were up 9.4
percent to $232.8 million from $212.7 million in 1991. Sales
increased from vehicle production by U.S. automakers, higher spending
by municipalities on fare collection systems, and the fourth quarter
acquisition of Ryken Tube Manufacturing. The company divested several
telecommunications equipment product lines that contributed
approximately $9.0 million to 1991 sales. Exclusive of these product
line divestitures, sales were up more than 10 percent due to the
success of the matrix switch product line. In monitoring equipment,
large foreign contracts for analog and digital systems boosted sales.
Gross margins held steady during 1992. Lower volume in the Process
Controls sector was offset by a liquidation of LIFO inventories, which
lowered 1992 costs by approximately $5.8 million. Cost containment and
inventory management activities were responsible for these reductions.
Included in cost of sales in 1992 was the incremental charge from SFAS
106 of $4.6 million.
The ratio of selling, general and administrative expenses to sales was
20.5 percent in 1992 and 20.6 percent in 1991. This continued
improvement reflects the benefits of the company's restructuring
efforts, a focus on reaching a critical mass, and continued cost
containment.
Net interest expense for 1992 was $24.4 million, down 13% from $28.1
million in 1991 from lower effective interest rates on somewhat higher
floating rate debt and refinancing high coupon fixed rate debt.
The effective income tax rate was 33.6 percent for 1992 compared with
28.5 percent for 1991.
Liquidity and Capital Resources
Net cash provided by operating activities was $49.5 million in 1993
compared with $60.9 million in 1992. Cash expenditures related to
divestitures were $72 million in 1993 and $46 million in 1992.
Excluding these expenditures, cash provided by ongoing operations in
1993 was approximately $121 million and in 1992 was approximately $107
million.
Capital expenditures were $55 million in 1993 compared with $50
million in 1992. 1993 capital expenditures included significant
renovations of Lightnin's Rochester facility to incorporate a product-
based layout and to consolidate the Avon, New York facility with
Rochester. Other significant 1993 expenditures included new production
facilities at OZ/Gedney in Connecticut, a new plant for GS Electric in
Pennsylvania, and modernization of some of the production lines at
DeZurik's Minnesota plant. The company anticipates that capital
expenditures will be somewhat higher in 1994 than in 1993.
Proceeds from dispositions were $98 million in 1993 compared with $6
million in 1992. The SEO divestiture accounted for the 1993 proceeds.
The company paid $20 million in cash for 1993 acquisitions compared
with $57 million in 1992. The company has consistently grown through
acquisitions of businesses and product lines, investing approximately
$163 million in cash and common stock during the three years ended
December 31, 1993. Three acquisitions were completed in 1993 and nine
were completed in 1992.
Net cash used for financing activities was $86 million in 1993, which
includes dividend payments of $38 million. In 1992, cash of $41
million was provided by financing activities primarily through
increased debt. During 1993, the company received cash of $139 million
through the issuance of common stock and the exercise of stock
options. Long-term and short-term borrowings were reduced in 1993 by
$180 million.
Long-term debt-to-capitalization improved to 26.7 percent at December
31, 1993 from 49.5 percent at December 31, 1992. The company used the
proceeds from the sale of common stock and SEO to reduce debt.
At December 31, 1993, the company had unused lines of credit
(principally committed revolving credit agreements) of $702 million
and amounts available under shelf registrations of $300 million. The
company expects that cash provided from operations and unused credit
lines will be sufficient to provide for the company's financing needs
for the next year. Additional financing may be undertaken as required.
As a result of the company's restructuring activities and business
divestitures, the company holds several idle facilities for sale or
sublease. Idle facilities are carried at estimated realizable values
with reserves for estimated disposal costs.
At December 31, 1993, the company reported deferred tax assets of
$108.7 million, net of deferred tax liabilities of $72 million and a
valuation allowance of $43.2 million. The carrying amount of the net
deferred tax asset is based on management's assessment that most net
operating loss carryforwards and deductible items will be realized
through future taxable earnings or alternative tax planning
strategies.
Environmental Matters
The company is involved in various stages of investigation and
remediation relative to environmental protection matters, arising from
its own initiative, from indemnification of purchasers of divested
operations, or from legal or administrative proceedings, some of which
include waste disposal sites. In certain instances, the company may be
exposed to joint and several liability for remedial action or damages.
The company, along with several other entities, has been named as a
Potentially Responsible Party for remedial costs at certain
third-party sites listed on the National Priorities List under CERCLA.
The potential costs related to such matters and the possible impact on
future operations are uncertain, due in part to the complexity of
government laws and regulations and their interpretations, the varying
costs and effectiveness of cleanup technologies and methods, the
uncertain level of insurance or other types of recovery, and the
questionable level of the company's responsibility. In the company's
opinion, after considering reserves established for such purposes,
remedial actions for compliance with the present laws and regulations
governing the protection of the environment are not expected to have a
material adverse impact on the company's results of operations or
financial position.
Other Matters
As a producer of capital goods and equipment, the results of the
company's businesses can vary with the relative strength of the
economy. Demand for products in the process controls sector follows
the demand for durable goods orders, and strength in heavy industrial
and utility markets is key to the success of this sector. The
electrical controls sector depends upon several markets, principally
the construction and computer equipment industries. The industrial
technology sector depends on several markets, primarily automotive,
mass transportation, and telecommunications equipment. Mass
transportation depends upon continued federal and local government
spending, and telecommunications is dependent upon continued research
and development and the continued success of new products. While no
one marketplace or industry has a major impact on the company's
operations or results, the inherent pace of technological changes
presents certain risks that the company monitors carefully. Success
within all of the company's businesses is dependent upon the timely
introduction and acceptance of new products.
MANAGEMENT'S RESPONSIBILITY FOR FINANCIAL STATEMENTS
Management is responsible for the preparation of the company's
consolidated financial statements and related information appearing in
this annual report. Management considers that the consolidated financial
statements fairly reflect the form and substance of transactions and that
the financial statements reasonably present the company's financial
position and results of operations in conformity with generally accepted
accounting principles. Management also has included in the Company's
financial statements amounts that are based on estimates and judgements
which it views are reasonable under the circumstances.
The independent accountants audit the company's consolidated financial
statements in accordance with generally accepted auditing standards and
provide an objective, independent review of the fairness of reported
operating results and financial position.
The Board of Directors of the company has an Audit Review Committee
composed of four non-management Directors. The Committee meets
periodically with financial management, the internal auditors and the
independent accountants to review accounting, control, auditing and
financial reporting matters.
/s/ Edmund M. Carpenter /s/ Stephen W. Nagy
Edmund M. Carpenter Stephen W. Nagy
Chairman and Senior Vice President-Finance
Chief Executive Officer and Chief Financial
Officer
REPORT OF INDEPENDENT AUDITORS
The Board of Directors and Shareholders
General Signal Corporation
We have audited the accompanying balance sheet of General Signal
Corporation and consolidated subsidiaries as of December 31, 1993 and
1992, and the related statements of earnings, shareholders' equity, and
cash flows for the years then ended. These financial statements are the
responsibility of the company's management. Our responsibility is to
express an opinion on these financial statements based on our audits. The
financial statements of General Signal Corporation and consolidated
subsidiaries for the year ended December 31, 1991 were audited by other
auditors whose report dated January 24, 1992, expressed an unqualified
opinion on those statements.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are
free of material misstatement. An audit includes examining, on a test
basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles
used and significant estimates made by management, as well as evaluating
the overall financial statement presentation. We believe that our audits
provide a reasonable basis for our opinion.
In our opinion, the 1993 and 1992 financial statements referred to above
present fairly, in all material respects, the financial position of
General Signal Corporation and consolidated subsidiaries at December 31,
1993 and 1992 and the results of their operations and their cash flows
for each of the years then ended in conformity with generally accepted
accounting principles.
In 1993, the company changed its method of accounting for postemployment
benefits. In 1992, the company changed its method of accounting for
income taxes and for postretirement benefits other than pensions. These
changes are discussed in the notes to the financial statements.
/s/ ERNST & YOUNG
Stamford, Connecticut
January 25, 1994
General Signal Corporation and Consolidated Subsidiaries
STATEMENT OF EARNINGS
(In thousands, except per-share data)
Year Ended December 31, 1993 1992 1991
Net sales $1,530,006 $1,674,205 $1,615,832
Cost of sales 1,100,590 1,205,622 1,165,325
Selling, general and
administrative expenses 308,370 339,818 333,001
Transaction and
consolidation charge 13,200 - -
Disposition of businesses
and restructuring:
Prior dispositions 19,600 - -
Semiconductor and restructuring(22,700) 85,600 -
Total operating costs
and expenses 1,419,060 1,631,040 1,498,326
Operating earnings 110,946 43,165 117,506
Interest expense, net (16,548) (24,379) (28,055)
Earnings from continuing
operations before income
taxes 94,398 18,786 89,451
Income taxes 27,802 6,321 25,494
Earnings from continuing
operations 66,596 12,465 63,957
Discontinued operations:
Loss on disposal,
net of income taxes - - (9,800)
Earnings before extraordinary
charges and cumulative
effect of accounting changes 66,596 12,465 54,157
Extraordinary charges (6,576) (330) -
Cumulative effect of accounting
changes (25,300) (92,400) -
Net earnings (loss) $34,720 $(80,265) $54,157
Earnings (loss) per share
of common stock:
Continuing operations $1.47 $0.30 $1.66
Loss on disposal of
discontinued operations - - (0.26)
Extraordinary charges (0.14) (0.01) -
Cumulative effect of
accounting changes (0.56) (2.21) -
Net earnings (loss) $0.77 $(1.92) $1.40
Average common shares outstanding 45,205 41,753 38,572
See accompanying notes to financial statements
General Signal Corporation and Consolidated Subsidiaries
BALANCE SHEET
(In thousands)
December 31, 1993 1992
ASSETS
Current assets:
Cash and cash equivalents $1,253 $16,455
Accounts receivable 255,534 258,608
Inventories 196,286 205,883
Prepaid expenses and
other current assets 55,482 57,965
Deferred income taxes 60,315 63,660
Assets held for sale at estimated
realizable value 25,675 91,069
Total current assets 594,545 693,640
Property, plant and equipment 263,353 246,858
Intangibles 184,240 181,190
Other assets 134,314 107,186
Deferred income taxes 48,389 29,554
Total assets $1,224,841 $1,258,428
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Short-term borrowings and current
maturities of long-term debt $9,334 $13,759
Accounts payable 131,300 130,672
Accrued expenses 177,829 180,344
Income taxes 7,385 21,067
Total current liabilities 325,848 345,842
Long-term debt, less current maturities 191,382 367,654
Accrued postretirement and postemployment
obligations 173,693 152,500
Other liabilities 8,732 17,583
Total long-term liabilities 373,807 537,737
Shareholders' equity:
Common stock: authorized 75,000 shares;
issued 63,360 in 1993 and 62,720 in 1992 77,082 45,077
Additional paid-in capital 271,958 262,750
Retained earnings 583,099 588,067
Cumulative translation adjustments (8,483) (9,021)
923,656 886,873
Common stock in treasury, at cost: 16,017
shares in 1993 and 20,593 shares in 1992 (398,470) (512,024)
Total shareholders' equity 525,186 374,849
Total liabilities and shareholders' equit $1,224,841 $1,258,428
See accompanying notes to financial statements
General Signal Corporation and Consolidated Subsidiaries
STATEMENT OF SHAREHOLDERS' EQUITY
(In thousands)
Additional Cumulative Common
Common Paid-In Retained Translation Stock In
Stock Capital Earnings Adjustments Treasury
Balance at
December 31, 1990 $42,151 $310,118 $681,871 $2,004 $(585,795)
Net earnings - - 54,157 - -
Dividends declared - - (34,720) - -
Exercise of stock
options and savings
and stock ownership
plan funding 62 3,348 - - (250)
Translation adjustments - - - 3,490 -
Balance at
December 31, 1991 42,213 313,466 701,308 5,494 (586,045)
Restatement for
acquisition of Revco 2,631 (63,306) 2,280 - 65,280
Net loss - - (80,265) - -
Dividends declared - - (35,256) - -
Exercise of stock options
and savings and stock
ownership plan funding 233 12,590 - - 8,741
Translation adjustments - - - (14,515) -
Balance at
December 31, 1992 45,077 262,750 588,067 (9,021) (512,024)
Net earnings - - 34,720 - -
Dividends declared - - (39,688) - -
Sale of common stock - 20,409 - - 102,900
Stock split 31,595 (31,595) - - -
Exercise of stock options
and savings and stock
ownership plan funding 410 20,394 - - 10,654
Translation adjustments - - - 538 -
Balance at
December 31, 1993 $77,082 $271,958 $583,099 $(8,483) $(398,470)
See accompanying notes to financial statements
General Signal Corporation and Consolidated Subsidiaries
STATEMENT OF CASH FLOWS
(In thousands)
Increase (Decrease) in Cash and Cash Equivalents
Year Ended December 31, 1993 1992 1991
Cash flows from operating activities:
Earnings before extraordinary charges
and cumulative effect of accounting
changes $66,596 $12,465 $ 54,157
Adjustments to reconcile earnings
to net cash from operating
activities:
Disposition of businesses and
restructuring 10,100 85,600 29,500
Deferred income taxes (3,723) (38,485) 11,613
Depreciation and amortization 46,364 56,697 54,377
Pension credits (10,743) (16,089) (12,211)
Other, net 6,644 (2,325) (2,072)
Changes in assets and liabilities,
net of effects from acquisitions
and divestitures:
Accounts receivable 5,283 (2,155) 11,532
Inventories 12,943 (1,475) 35,810
Prepaid expenses and other
current assets 5,371 (5,197) 32,052
Accounts payable (2,436) 9,488 (8,875)
Accrued expenses and other (73,205) (20,387) (79,308)
Income taxes (13,682) (17,233) (10,964)
Net cash from operating activities 49,512 60,904 115,611
Cash flows from investing activities:
Dispositions 97,562 6,177 79,077
Capital expenditures (55,058) (49,858) (48,130)
Acquisitions (19,950) (57,306) -
Other, net (1,108) (955) 1,369
Net cash from investing activities 21,446 (101,942) 32,316
Cash flows from financing activities:
Issuance of long-term debt 9,309 210,630 97,984
Redemption of debt (189,794) (144,470) (204,457)
Issuance of common stock 139,078 10,264 3,160
Extraordinary charges on early
extinguishment of debt (6,576) (330) -
Dividends paid (37,902) (35,082) (34,683)
Net cash from financing activities (85,885) 41,012 (137,996)
Effect of exchange rate changes on cash (275) (1,974) 628
Net changes in cash and cash equivalents (15,202) (2,000) 10,559
Cash and cash equivalents at beginning
of year 16,455 18,455 7,793
Cash and cash equivalents at end of yea $ 1,253 $16,455 $ 18,352
See accompanying notes to financial statements
NOTES TO THE FINANCIAL STATEMENTS
(Dollars in thousands, except per-share data)
ACCOUNTING POLICIES
Consolidation
The financial statements include the accounts of General Signal
Corporation and consolidated subsidiaries after elimination of
intercompany accounts and transactions. Investments in unconsolidated
companies where management exercises significant influence are accounted
for using the equity method.
Cash Equivalents
The company considers its investments in money market funds and its
holdings of highly liquid investments with original maturities of three
months or less to be cash equivalents.
Inventories
Inventories are stated at the lower of cost or market using the last-in,
first-out (LIFO) method at certain domestic units. Remaining inventories
are valued using the first-in, first-out (FIFO) method.
Property
Property, plant and equipment are stated at cost less accumulated
depreciation and amortization. Depreciation and amortization are provided
using the straight-line method over the estimated useful lives of assets.
Leasehold improvements are amortized over the life of the related asset
or the life of the lease, whichever is shorter.
Intangibles
Intangible assets (primarily the excess of purchase price over the fair
value of net assets acquired) are amortized on a straight-line basis over
periods not exceeding 40 years.
Revenue Recognition
Revenues are primarily recognized as products are shipped and services
are rendered. The percentage-of-completion method of accounting is
followed for long-term contracts. Under this method, earnings accrue as
the contract progresses toward completion, generally based on the
percentage of costs incurred or the units of product delivered.
Income Taxes
Income tax expense includes United States and foreign income taxes. For
periods after December 31, 1991, income taxes are provided based upon the
provisions of SFAS 109, "Accounting for Income Taxes". This pronouncement
requires, among other things, that deferred taxes be determined based on
differences between financial reporting and tax bases of assets and
liabilities measured using enacted tax rates and laws that will be in
effect when the differences are expected to reverse.
For periods before January 1, 1992, income taxes were provided based upon
the provisions of APB Opinion no. 11. To the extent that income for tax
and financial accounting differed due to the timing of certain reported
items, deferred income taxes were provided in the financial statements.
Income tax credits generally are included in net earnings as a reduction
of the provision for income taxes in the period in which they are allowed
for tax purposes.
Nonpension Postretirement and Postemployment Benefits
For periods after December 31, 1991, the company accounted for the cost
of its postretirement benefit programs other than pensions on the accrual
basis in accordance with the provisions of SFAS 106, "Employers'
Accounting for Postretirement Benefits Other Than Pensions". For periods
before January 1, 1992, such costs were accounted for on the
pay-as-you-go method.
For periods after December 31, 1992, the company accounted for the cost
of certain postemployment benefits, primarily severance and disability,
on the accrual basis in accordance with the provisions of SFAS 112,
"Employers' Accounting for Postemployment Benefits". For periods before
January 1, 1993, these benefits were accounted for on the pay-as-you-go
method, except for certain severance costs, which were accounted for as
the severance events occurred.
Earnings Per Share
Earnings per share of common stock was calculated by dividing net
earnings by the weighted average number of common shares outstanding.
There was no dilutive impact from stock options or convertible debt
securities outstanding during the period.
Reclassifications
Certain reclassifications were made to conform prior years' data to the
current presentation.
ACCOUNTS RECEIVABLE
Accounts receivable are net of allowances for doubtful accounts of
$10,522 and $8,882 at December 31, 1993 and 1992, respectively.
INVENTORIES
December 31, 1993 1992
Finished goods $ 56,066 $ 61,509
Work in process 63,343 65,515
Raw material and purchased parts 103,985 112,689
Total FIFO cost 223,394 239,713
Excess of FIFO cost over LIFO
inventory value (27,108) (33,830)
Net carrying value $196,286 $205,883
Inventories valued using LIFO were approximately $70,600 and $79,900
at December 31, 1993 and 1992, respectively. Reductions in inventory
quantities resulted in liquidations of LIFO inventory layers carried
at lower costs prevailing in prior years as compared with the cost of
1993 and 1992 purchases. The effects were to reduce the amount of
beginning LIFO reserve and increase before tax income by $6,700 and
$7,000 for 1993 and 1992, respectively. Had cost of sales related to
the LIFO inventory layers that were liquidated been valued using
current costs, the effects would have been to decrease net earnings by
$3,700 or $0.08 per share in 1993 and $3,900 or $0.09 per share in
1992.
Progress payments, netted against work in process at year end, were
$4,066 in 1993 and $2,621 in 1992.
CONTRACTS IN PROGRESS
Prepaid expenses and other current assets include contracts in
progress of $46,028 and $41,536 at December 31, 1993 and 1992,
respectively. Contracts in progress represent revenue recognized on a
percentage-of-completion basis over related progress billings of
$122,299 at December 31, 1993 and $98,830 at December 31, 1992,
respectively. Substantially all contracts in progress at year-end are
billed during the subsequent year.
PROPERTY, PLANT AND EQUIPMENT
December 31, 1993 1992
Land $12,306 $ 12,358
Buildings and leasehold
improvements 156,973 152,118
Machinery and equipment 466,041 421,015
635,320 585,491
Less accumulated depreciation
and amortization (371,967) (338,633)
$263,353 $246,858
INCOME TAXES
For financial reporting purposes, earnings from continuing operations
before income taxes includes the following components:
1993 1992 1991
Pretax income:
United States $93,041 $(2,026) $65,187
Foreign 1,357 20,812 24,264
$94,398 $18,786 $89,451
The reconciliation of income tax attributable to continuing operations
computed at the U.S. federal statutory tax rate to income tax expense
is:
Year Ended December 31, Liability Method Deferred Method
1993 1992 1991
Tax at U.S. federal
statutory rate 35.0% 34.0% 34.0%
State and local income
taxes, net of U.S.
federal benefit 2.9 3.4 3.2
Foreign sales corporation (2.3) (9.9) (4.6)
Goodwill amortization 1.9 7.1 2.4
Foreign rates and foreign
dividends (1.6) (6.4) (1.9)
Effect of enacted U.S.
federal rate change
on deferred taxes (3.0) -- --
Adjustments to prior
years' tax liabilities (3.8) -- --
Other 0.4 5.4 (4.6)
Total 29.5% 33.6% 28.5%
The components of the provisions for income taxes attributable to
continuing operations are as follows:
Deferred
Liability Method Method
1993 1992 1991
Current:
Federal $ 185 $5,501 $(4,754)
Foreign (418) 7,510 7,625
State 978 588 (65)
Total current 745 13,599 2,806
Deferred:
Federal 22,335 (6,505) 18,389
Foreign (930) (904) (87)
State 5,652 131 4,386
Total deferred 27,057 (7,278) 22,688
$27,802 $6,321 $25,494
The components of the provision for deferred income taxes for the year
ended December 31, 1991 are for losses on dispositions and
restructuring of $11,629, pension credits of $5,042, and other of
$6,017.
Deferred income taxes reflect the net tax effects of temporary
differences between the carrying amounts of assets and liabilities for
financial reporting purposes and the amounts used for income tax
purposes. Significant components of the company's deferred tax assets
and liabilities are as follows:
Deferred tax assets: 1993 1992
Acquired tax benefits and
basis differences $ 58,430 $ 67,149
Other postretirement and postemployment
benefits 73,053 61,293
Losses on dispositions and restructuring 27,602 34,798
Inventory 14,004 11,968
Credit carryforward 14,475 --
Other 36,328 31,690
Total deferred tax assets 223,892 206,898
Valuation allowance for deferred tax
assets (43,200) (43,600)
Net deferred tax assets 180,692 163,298
Deferred tax liabilities:
Accelerated depreciation 29,811 30,273
Pension credits 24,158 18,659
Other 18,019 21,152
Total deferred tax liabilities 71,988 70,084
Net deferred tax assets $108,704 $93,214
At December 31, 1993, the company had the following net operating loss
and tax credit carryforwards available:
Expiration Operating Tax
Dates Losses Credits
1994 - 1995 $-- $6,000
1996 - 1997 5,500 14,700
1998 - 1999 5,600 12,300
2000 - 2001 45,800
2002 - 2003 11,400
2004 - 2005 2,100
Based on management's assessment, it is more likely than not that the
net deferred tax assets will be realized through future taxable
earnings or alternative tax strategies. In the event that the tax
benefits relating to the valuation allowance are subsequently
realized, $6,600 of such benefits would reduce goodwill.
Undistributed earnings of the company's foreign subsidiaries amounted
to approximately $89,900 at December 31, 1993. Those earnings are
considered to be indefinitely reinvested and accordingly, no provision
for U.S. federal and state income taxes, or foreign withholding taxes
has been made. Upon distribution of those earnings, the company would
be subject to U.S. income taxes (subject to an adjustment for foreign
tax credits) and withholding taxes payable to the various foreign
countries. Determination of the amount of unrecognized deferred U.S.
income tax liability is not practicable; however, unrecognized foreign
tax credit carryovers would be available to reduce some portion of the
U.S. liability. Withholding taxes of approximately $7,900 would be
payable upon remittance of all previously unremitted earnings at
December 31, 1993.
DEBT
December 31, 1993 1992
5.75% Convertible Subordinated
Debentures due 2002 $100,000 $100,000
Short-term borrowings --
1993, 3.4%; 1992, 3.7% - 4.1% 9,697 173,292
Industrial Revenue Bonds due 2000-2014;
no stipulated principal repayments
prior to maturity (primarily
variable rate) 45,715 42,715
Notes due 1995 -- 7.14% 25,000 25,000
Other long-term borrowings 20,304 37,188
200,716 378,195
Less current maturities 9,334 10,541
$191,382 $367,654
Maturities of long-term debt through 1998 are: 1994 -- $9,334; 1995
- -- $25,744; 1996--$8,310; 1997 -- $9,946; and 1998 -- $299.
A portion of the proceeds from the issuance of common stock and the
sale of SEO was used for the early extinguishment of higher-rate debt
and swap agreements, which resulted in an extraordinary charge of
$10,700 (net of tax, $6,576).
During 1992, the company issued $100,000 of 5.75% Convertible
Subordinated Notes due 2002. The notes are convertible into the
company's common stock at a conversion rate of 25.32 shares of company
common stock for each $1 principal amount of the notes (equivalent to
a conversion price of approximately $39.50 per share).
The company maintains credit arrangements with banks in the U.S. and
abroad, which aggregated approximately $702,000 and $665,000 at
December 31, 1993 and 1992, respectively. At year end the company had
two revolving credit agreements of $200,000 each. On January 12, 1994,
the company entered into two new revolving credit agreements,
replacing those outstanding at December 31, 1993, that expire January
11, 1995 and 1998. These agreements permit domestic and Eurodollar
borrowings of up to $360,000 at interest rates offered to investment
grade customers. The agreements are also convertible into one-year
term loans on their maturity dates.
Commercial paper and money market loans are classified as long-term
debt as the company intends to refinance them on a long-term basis
either through continued short-term borrowing or available credit
facilities.
The company entered into interest rate exchange agreements with
certain financial institutions to limit its exposure to interest rate
volatility. These agreements involved transactions with principal
amounts of $25,000 and $150,000 at December 31, 1993 and 1992,
respectively. The company monitors the risk of default by the swap
counterparties and does not anticipate non-performance.
In April 1990, the company established a $300,000 medium-term note
program, providing for the issuance of fixed rate notes with
maturities between one and thirty years. The program was registered
with the SEC pursuant to the company's remaining 1988 $75,000 shelf
registration and the 1990 $225,000 shelf registration. As of December
31, 1993, no amounts had been borrowed under these shelf
registrations.
Effective November 1992, the company borrowed under a $25,000
three-year private placement agreement and an interest rate exchange
agreement, which together provided floating rate funds at a cost below
the cost of the company's commercial paper.
FOREIGN EXCHANGE CONTRACTS
The company entered into forward exchange contracts to hedge certain
foreign currency transactions for periods consistent with the terms of
the underlying transactions for periods through October 1997. These
contracts did not subject the company to currency risk from exchange
rate movements, as gains and losses on these contracts are deferred
and offset against losses and gains on the underlying transactions. At
December 31, 1993, the company had approximately $54,400 of such
contracts outstanding.
FAIR VALUE OF FINANCIAL INSTRUMENTS
Cash and cash equivalents, short- and long-term debt, and foreign
currency and interest rate exchange contracts had fair values that
approximate their carrying amounts. Financial guarantees and letters
of credit were issued by the company in the ordinary course of
business as required and had a fair value of approximately $21,100.
The fair values of financial guarantees and letters of credit were
based on the face value of the underlying instruments.
CONTINGENCIES AND COMMITMENTS
Litigation
The company and certain of its subsidiaries are defendants in legal
proceedings incidental to its business. Although the ultimate
disposition of these proceedings is not presently determinable,
management does not expect the outcome to have a material adverse
impact on the company's financial position.
Leases
The future minimum rental payments under leases with remaining
noncancelable terms in excess of one year are:
Year Ending December 31,
1994 $16,200
1995 11,500
1996 8,600
1997 7,000
1998 6,100
Subsequent to 1998 17,000
Total minimum payments $66,400
Minimum payments exclude sublease rentals of $4,100 under
noncancelable subleases. Total rent expense in 1993, 1992, and 1991
was $15,600, $25,200, and $25,300, respectively.
Environmental Matters
The company is involved in various stages of investigation and
remediation relative to environmental protection matters, arising from
its own initiative, from indemnification of purchasers of divested
operations, or from legal or administrative proceedings, some of which
include waste disposal sites. In certain instances, the company may be
exposed to joint and several liability for remedial action or damages.
The company, along with several other entities, has been named as a
Potentially Responsible Party for remedial costs at certain
third-party sites listed on the National Priorities List under CERCLA.
The potential costs related to such matters and the possible impact on
future operations are uncertain due in part to the complexity of
government laws and regulations and their interpretations, the varying
costs and effectiveness of cleanup technologies, the uncertain level
of insurance or other types of recovery, and the questionable level of
the company's responsibility. In management's opinion, after
considering reserves established for such purposes, remedial actions
for compliance with the present laws and regulations governing the
protection of the environment are not expected to have a material
adverse impact on the company's results of operations or financial
position.
It is the company's policy not to discount environmental obligations
or to offset expected insurance recoveries against expected
obligations when determining the amount of environmental accruals. The
company's environmental accruals cover all anticipated costs,
including capital expenditures, for investigation, remediation, and
operation and maintenance of clean-up sites.
CAPITAL STOCK
Preferred Stock
Ten million shares of cumulative preferred stock, par value $1.00 per
share, are authorized but unissued.
Common Stock
The 1,960,000 shares issued through 1969 have a par value of $6.67 per
share. Shares issued since then have a par value of $1.00 per share.
During 1993, the company completed a public offering for 4,140,000
shares of common stock at $31 per share. The company realized net
proceeds of $123,300, which were used for debt extinguishment and
general corporate purposes. During 1993, the company completed a two-
for-one split of the company's common stock in the form of a 100
percent stock distribution. Common shares and per-share data for all
periods presented have been restated to reflect the stock split.
Treasury Stock
Number of shares (In thousands) 1993 1992 1991
Balance at beginning of year 20,593 23,577 23,569
Restatement for the
acquisition of Revco -- (2,631) --
Common stock reacquired 20 11 10
Common stock sold (4,140) -- --
Common stock issued under
the company's incentive
compensation and savings
and stock ownership plans (456) (364) (2)
Balance at end of year 16,017 20,593 23,577
Common Stock Purchase Rights
On March 7, 1986, the Board of Directors declared a dividend
distribution of one common stock purchase right (Right) for each share
of company common stock. The Rights expire on March 21, 1996, unless
redeemed earlier by the company. Each right entitles its registered
holder to purchase from the company one share of the company's common
stock at a price of $75 per share, subject to adjustment to prevent
dilution.
The Rights are not exercisable and cannot be transferred separately
from the company common stock until: 1) a person or group publicly
announces the acquisition of, or obtains the right to acquire, 20% or
more of the outstanding shares of the company's common stock; or 2) a
tender or exchange offer is announced or commenced that would result
in such an acquisition. Within 10 days after such a 20% interest has
actually been obtained, the company is entitled to redeem all of the
Rights at a price of five cents per Right.
If certain triggering events occur, and unless the Rights are redeemed
by the company, the Rights holder is entitled to receive for $75 per
Right the number of shares of the company's or an acquiring company's
common stock having a market value of $150 per share, subject to
adjustment to prevent dilution. This provision does not apply to
Rights that are beneficially owned by the acquirer. These triggering
events are: 1) the company is acquired in a merger or other business
combination transaction; 2) 50% or more of the company's assets or
earnings power are sold; 3) an acquirer engages in one of a number of
self-dealing transactions specified in the Rights Agreement; or 4) an
acquirer becomes the beneficial owner of 20% or more of outstanding
shares of the company's common stock.
EMPLOYEE BENEFIT PLANS
Pension Plans
The company's pension plans cover substantially all salaried and
hourly paid employees, including certain employees in foreign
countries. The plans generally provide benefit payments using a
formula based on an employee's compensation and length of service or,
in some cases, stated amounts for each year of service. The company
funds United States pension plans in amounts equal to the minimum
funding requirements of the Employee Retirement Income Security Act of
1974, plus additional amounts that may be approved from time to time.
Substantially all plan assets are invested in cash and short-term
investments or listed stocks and bonds and real estate. Plan assets
and obligations of non-U.S. subsidiaries were not material.
The periodic net pension income related to continuing operations is
comprised of the following:
Year Ended
December 31, 1993 1992 1991
Service cost-benefits
earned during the
period $ 11,917 $ 11,863 $ 11,682
Interest cost on projected
benefit obligation 32,197 30,269 28,778
Actual return on assets (58,338) (18,761) (111,938)
Net amortization and
deferral 3,481 (39,460) 59,267
Net pension income $(10,743) $(16,089) $(12,211)
The following table shows the plans' funded status and amounts
recognized in the balance sheet:
December 31, 1993 1992
Actuarial present value of benefit
obligations:
Vested benefit obligation $(406,984) $(322,723)
Accumulated benefit obligation $(430,783) $(348,017)
Fair value of plan assets $ 554,132 $527,235
Projected benefit obligation (448,188) (371,692)
Plan assets in excess of
projected benefit obligation 105,944 155,543
Unrecognized net (gain) loss 3,958 (51,091)
Prior service cost not yet
recognized in net pension cost 11,110 11,871
Unrecognized net asset (49,245) (53,790)
Prepaid pension $71,767 $62,533
The actuarial assumptions used
were:
Discount rate 7.40% 8.75%
Rate of increase in compensation
levels 5.00% 6.50%
Expected long-term rate of return
on assets 9.50% 9.50%
Under the Savings and Stock Ownership Plan and other supplemental
plans, the company matches employee contributions in cash and common
stock equal to a percentage of certain amounts contributed by
employees. The company contributions under these plans amounted to
$9,383 in 1993, $9,837 in 1992, and $9,018 in 1991 and were invested
in shares of the company's common stock. At December 31, 1993,
2,135,000 shares were reserved for issuance under these plans.
Nonpension Retirement Benefits
The company and its U.S. subsidiaries have postretirement plans that
provide health and life insurance benefits for retirees. Some of
these plans require employee contributions at varying rates. Not all
employees are eligible to receive these benefits, with eligibility
depending on the plan in effect at a particular location.
The accumulated postretirement benefit obligation at December 31,
1993 was determined using the terms of the company's various plans,
together with relevant actuarial assumptions and health care cost
trend rates projected at estimated annual rates ranging from 12.1%
in 1993 and 11.1% in 1994 to 4.7% through the year 2005 and a
discount rate of 7.4%.
A one percent annual increase in these assumed cost trend rates
would increase the accumulated postretirement benefit obligation by
approximately $4,182 and annual service costs by approximately $700.
Certain of the company's non-U.S. subsidiaries have similar plans
for retirees. The company's obligations for such plans are not
material.
During 1993, the company changed its postretirement health benefit
plans to cap certain costs and require the coordination of benefits
with Medicare in certain instances beginning January 1, 2000. The
effect of these changes was to reduce 1993 expense by $3,400 and to
reduce the accumulated postretirement benefit obligation. Future
years expense will be similarly affected by these changes.
The net periodic postretirement benefit cost related to continuing
operations is comprised of the following:
1993 1992
Service cost-benefits attributed to
service during the period $912 $1,850
Interest cost on the accumulated
postretirement benefit obligation 9,573 12,920
Net amortization and deferral (4,367) (120)
Net periodic postretirement benefit
cost $6,118 $14,650
Amounts paid in 1991 for postretirement benefit costs were $6,100.
The company's plans covering postretirement benefits other than
pensions were not funded.
The following table shows the plans' funded status and amounts
recognized in the balance sheet as of December 31, 1993 and 1992:
December 31, 1993 December 31, 1992
Health Life Health Life
Accumulated postretirement
benefit obligation:
Retirees $(78,717) $(13,862) $(101,618) $(12,531)
Fully eligible active
plan participants (6,647) (4,618) (6,907) (4,191)
Other active plan
participants (12,317) (2,806) (11,251) (2,195)
Total (97,681) (21,286) (119,776) (18,917)
Unrecognized net loss 1,525 1,633 -- --
Unrecognized prior service
cost (40,556) -- (22,807) --
Accrued postretirement
benefit cost (136,712) (19,653) (142,583) (18,917)
Less amounts classified
as current 8,000 600 8,000 1,000
$(128,712) $(19,053) $(134,583) $(17,917)
The unrecognized prior service cost at December 31, 1993 and 1992 represents
unamortized amounts for plan amendments resulting from revisions to
company-sponsored health plans, which reduced benefit levels.
Nonpension Postemployment Benefits
The cumulative effect at January 1, 1993 of adopting SFAS 112 reduced net
income by $25,300, net of $12,700 of income tax benefits. The effect of this
change on 1993 operations was to reduce net income by $1,700. During 1993,
the company paid $8,200 for severance which was charged to the SFAS 112
reserve.
STOCK INCENTIVE PROGRAM
The company has a stock incentive program whereby executive officers and
designated employees have been or may be granted either options to purchase
shares of company common stock or restricted stock. Restricted stock awards
were granted during 1993 and 1992 for 12,122 shares and 4,900 shares of
company common stock, respectively. The shares covered by the restricted
stock award vest at a rate of 20% per year over a five-year period. In
addition, non-employee directors may elect to defer all or part of their
cash compensation as a director and to receive in lieu thereof restricted
stock. During 1993, four directors received 3,922 shares of company common
stock subject to a five-year restriction period. Options under all the plans
are exercisable during specified dates at prices at least equal to 100% of
the fair market value on the date of grant. Approximately two-thirds of the
options granted during 1992 were at prices in excess of the fair market
value of the company's common stock at the date of the grant. The options
granted during 1993 were at 100 percent of the fair market value of the
company's common stock at the date of grant. At December 31, 1993 and 1992,
3,470,000 shares and 4,124,000 shares of company common stock were reserved
for issuance.
Option Activity
Number of shares (In thousands) 1993 1992 1991
Shares under option
at January 1, at prices
from $17.25 to $36.20 2,281 2,711 2,010
Options granted: at
prices from $22.94 to
$36.20 270 40 1,000
Options exercised: at
prices from $17.25 to
$30.32 (628) (454) (150)
Options terminated (56) (16) (149)
Shares under option at
December 31, at prices
from $19.44 to $36.20 1,867 2,281 2,711
Shares exercisable at
December 31, at prices
from $19.44 to $31.48 1,033 1,472 1,731
In 1991, 2,940,000 shares were issued in connection with options
granted for acquisitions.
BUSINESS COMBINATIONS
On October 15, 1993, the company acquired Revco Scientific, Inc.
(Revco) in exchange for 2,631,210 shares of common stock. Revco
designs, manufactures, and markets specialized laboratory equipment,
including ultra-low temperature freezers, specialty laboratory
refrigerators, and CO2 incubators, for use in scientific, research, and
clinical markets.
The transaction was accounted for as a pooling of interests. The
company's consolidated financial statements for 1993 and 1992 have
been restated to include the results of operations, financial
positions, and cash flows of Revco. Revco's financial position and
results of operations were not material to the company for any period
presented.
Transaction and consolidation costs of $13,200 were incurred
principally as a result of the merger. The transaction costs include
investment banker and professional fees. The consolidation and
integration costs include provisions for streamlining marketing and
distribution arrangements, consolidation of field service and sales
offices, relocation of certain product lines and key personnel, and
severance-related costs, primarily at the company's locations existing
prior to the merger. Charges of $2,337 also were made during the
second quarter of 1993 to conform Revco's accounting practices to the
company's accounting policies and practices principally for inventory
and warranties.
During the three-year period ended December 31, 1993, the company
acquired the entities described below for cash and common stock valued
at $155,000 plus, in certain instances, amounts that are contingent
upon future earnings. The acquisitions, except Revco, were accounted
for as purchases and accordingly, the results of operations of the
acquired companies are included in the statement of earnings for the
period in which they were owned by the company.
Date
Principal Business Acquired
Layne & Bowler Vertical turbine pumps November 1993
Jannette Drives Drive units for dampers November 1993
and valves primarily
used for utilities
Revco Scientific, Inc. Ultra-low temperature October 1993
freezers, laboratory
refrigerators, and
CO2 incubators
Northwest Metal tubing, November 1992
Alabama Industries connectors, and
couplings
Ryken Tube Automotive tubular October 1992
Manufacturing replacement parts
Unival Ported gate valves August 1992
Valex's magnetic Magnetic mixers July 1992
mixer product line
GMV Fixed mount and July 1992
portable mixers
Fire Alarm and Advanced fire alarm April 1992
Systems Technology, Inc. control products
Associated Lighting Hazardous location March 1992
conduits and fittings
ABB's Uninterruptible Uninterruptible power January 1992
Power Supply Division supplies
Real Time Techniques Multichannel signal January 1992
testing equipment
DISPOSITION OF BUSINESSES AND RESTRUCTURING
At the beginning of the fourth quarter of 1992, the company adopted a
plan to divest its semiconductor equipment operations. The units
comprising these operations were Assembly Technologies, Drytek,
Electroglas, GCA, Ultratech Stepper, and General Signal Japan, which
supports the aforementioned units in Japan. The company recorded a
pre-tax charge of $85,600 ($58,200 net of tax benefits) to provide for
net losses on dispositions, estimated operating losses of the
operations through disposition, severance, and idle facilities
resulting from the disposition, and restructuring costs. The results
of operations for the semiconductor equipment group for the fourth
quarter of 1992 are excluded from the consolidated statement of
earnings in 1992. For the first three quarters of 1992, the
semiconductor equipment operations reported a net loss of
approximately $5,200 or $0.12 per share on sales of $135,000.
During 1993, the company completed the sale of Electroglas, Drytek and
Ultratech Stepper, and substantially disposed of GCA and GS Japan. In
connection with these operations, the company incurred approximately
$38,400 in operating losses, severance payments, idle facility costs,
and transaction costs that had been previously accrued. The company
also realized $53,200 of excess reserves relating to the disposition
of the semiconductor equipment operations as a result of higher
proceeds from the sale of units and lower severance costs.
Also during the year, $30,500 was provided for factory consolidation
and rearrangement ($20,900), product restructuring and realignment
($6,800), and reorganization of lines of distribution and
administration ($2,800), all related to the continuing operations of
the company.
In 1990, the company discontinued its transportation business,
primarily New York Air Brake and General Railway Signal. During 1991,
the company completed the sale of substantially all the net assets of
New York Air Brake and General Railway Signal. During the fourth
quarter of 1991, the company provided a $9,800 after-tax charge (net
of tax benefits of $19,700) relating to the discontinued businesses.
During the fourth quarter of 1993, the company provided in operating
earnings an additional $19,600 related to the remaining portion of the
discontinued businesses primarily for Dynapower/Stratopower, and for
environmental and contractual obligations retained related to New York
Air Brake and General Railway Signal. This provision was made
primarily to write these operations down to estimated realizable value
and to recognize 1993 operating losses. Included in the 1993 charge is
$5,210 related to other previously divested operations of the company.
The company included the results of these operations in continuing
operations in 1993 as more than one year has passed since the
measurement date.
BUSINESS SECTOR INFORMATION
Product Sectors
1993 1992 1991 1990 1989
Net sales:
Process Controls $721,609 $ 739,026 $695,632 $727,267 $735,406
Electrical Controls 547,104 567,500 515,363 503,187 446,201
Industrial Technology 261,293 232,828 404,837 451,171 437,352
Dispositions -- 134,851 -- 13,322 119,328
$1,530,006 $1,674,205 $1,615,832 $1,694,947 $1,738,287
Operating earnings:
Process Controls $52,356(1) $69,958 $62,443 $74,015 $83,494
Electrical Controls 35,710(1) 43,140 43,889 47,127 50,996
Industrial Technology 44,835 32,906 21,313 27,819 35,616
Prior dispositions -- (7,423) -- (7,910) (7,047)
Dispositions and
restructuring (10,100)(2) (85,600) -- (122,200)(3) 8,679
122,801 52,981 127,645 18,851 171,738
Equity income 254 1,854 2,072 2,049 3,207
Interest expense, net (16,548) (24,379) (28,055) (31,466) (39,090)
Unallocated expenses (12,109) (11,670) (12,211) (14,627) (27,373)
Earnings (loss) from
continuing operations
before income taxes $94,398 $18,786 $89,451 $(25,193) $108,482
Identifiable assets:
Process Controls $474,292 $477,027 $473,905 $516,679 $513,728
Electrical Controls 326,522 330,773 295,691 287,002 200,102
Industrial Technology 167,171 181,732 305,347 329,743 395,797
Assets of discontinued
operations -- -- -- -- 136,632
967,985 989,532 1,074,943 1,133,424 1,246,259
General corporate
assets 213,065 160,304 89,040 105,029 61,100
Assets held for sale at
estimated realizable
value 25,675 91,069 -- 42,612 --
Investments in and
advances to
affiliates 18,116 17,523 16,215 13,568 16,982
Total assets $1,224,841 $1,258,428 $1,180,198 $1,294,633 $1,324,341
Depreciation and
amortization of
fixed assets:
Process Controls $16,555 $17,321 $16,378 $17,545 $19,761
Electrical Controls 13,022 12,336 11,777 11,484 9,935
Industrial Technology 6,500(4) 6,748(4) 14,722 16,054 15,306
Capital expenditures:
Process Controls $23,076 $19,611 $16,235 $15,263 $19,245
Electrical Controls 22,254 19,461 15,137 12,455 11,779
Industrial Technology 7,661(4) 5,048(4) 11,090 15,289 17,701
(1)Includes 1993 charges in Process Controls ($18,500) and
Electrical Controls ($4,000).
(2)Relates to charges in Process Controls ($37,200)and Electrical
Controls ($6,500), and net credits for the divested semiconductor and
transportation businesses ($33,600).
(3)Relates to the three business sectors as follows: Process
Controls ($38,940), Industrial Technology ($77,623), and Electrical Controls
($157).
(4) Excludes semiconductor equipment operations.
Geographic Areas
1993 1992 1991 1990 1989
Net sales:
United States $1,346,808 $1,428,687 $1,365,494 $1,449,187 $1,493,339
Foreign 238,219 307,497 323,333 322,976 328,981
Intergeographic (55,021) (61,979) (72,995) (77,216) (84,033)
$1,530,006 $1,674,205 $1,615,832 $1,694,947 $1,738,287
Operating earnings:
United States $126,619 $124,273 $108,332 $129,193 $137,056
Dispositions and
restructuring (10,100) (85,600) -- (122,200) 8,679
Foreign 6,282 14,308 19,313 11,858 26,003
122,801 52,981 127,645 18,851 171,738
Equity income 254 1,854 2,072 2,049 3,207
Interest expense, net (16,548) (24,379) (28,055) (31,466) (39,090)
Unallocated expenses (12,109) (11,670) (12,211) (14,627) (27,373)
Earnings (loss) from
continuing
operations
before income
taxes $94,398 $18,786 $89,451 $(25,193) $108,482
Identifiable assets:
United States $822,507 $ 769,204 $ 838,460 $919,957 $1,042,889
Foreign 145,478 220,328 236,483 213,467 203,370
967,985 989,532 1,074,943 1,133,424 1,246,259
General corporate assets 213,065 160,304 89,040 105,029 61,100
Assets held
for sale at estimated
realizable value 25,675 91,069 - 42,612 -
Investments in and
advances to
affiliates 18,116 17,523 16,215 13,568 16,982
Total assets $1,224,841 $1,258,428 $1,180,198 $1,294,633 $1,324,341
Export sales to
unaffiliated
customers (1) $126,921 $160,069 $158,016 $133,078 $154,284
(1) Included in United States' sales.
<TABLE>
QUARTERLY FINANCIAL INFORMATION (UNAUDITED)
<CAPTION>
(In millions, except First Second Third Fourth
per share data) 1993 1992 1993 1992 1993 1992 1993 1992
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Net sales $377.2 $425.2 $386.5 $435.0 $372.5 $421.7 $393.8 $392.4
Gross profit 110.0 118.0 98.1 119.0 112.6 116.0 108.7 115.7
Earnings from continuing
operations 18.0 15.7 19.5 17.1 24.3 16.8 4.9 (37.2)
Extraordinary charge -- -- (6.6) -- -- -- -- (0.3)
Cumulative effect of
accounting changes (25.3) (92.4)(1) -- -- -- -- -- --
Net earnings (loss) $(7.3) $(76.7) $12.9 $17.1 $24.3 $16.8 $4.9 ($37.5)
Earnings (loss) per share
of common stock:
Continuing operations $0.42 $0.38 $0.44 $0.41 $0.52 $0.40 $0.10 $(.88)
Extraordinary charges -- -- (0.15) -- -- -- -- (.01)
Cumulative effect of
accounting changes (0.60) (2.23) -- -- -- -- -- --
Net earnings (loss) $(0.18) $(1.85) $0.29 $0.41 $0.52 $0.40 $0.10 $(.89)
</TABLE>
Note: The sum of the quarters' earnings per share does not equal the
full year per-share amounts. (1) Composed of the effect of adoption of SFAS
106 ($96,000, net of taxes of $59,000) and SFAS 109 ($3,700).
1993 amounts have been restated for the adoption of SFAS 112
effective January 1, 1993. 1993 and 1992 amounts have been restated to reflect
the acquisition of Revco. The effect of adopting SFAS 112 was to reduce
previously reported 1993 earnings from continuing operations by $848 and $283
in the first and fourth quarters, respectively. The effect of the Revco
acquisition was to increase previously reported earnings from continuing
operations by $1,333, $179 and $1,779 for each of the three quarter ended
September 30, 1993, and to increase previously reported earnings from
continuing operations by $825, $1,179, $820 and $450 for each of the four
quarters ended December 31, 1992.
Common Stock:
Dividends Paid Price Range
Quarter 1993 1992 1993 1992
1st $0.225 $0.225 33 7/8 - 30 1/8 31 - 25 7/8
2nd 0.225 0.225 33 7/8 - 30 32 5/8 - 28 5/8
3rd 0.225 0.225 33 3/8 - 30 1/2 29 7/8 - 26 7/8
4th 0.225 0.225 37 7/8 - 31 1/2 30 7/8 - 26 1/2
SUPPLEMENTARY INFORMATION
Balance Sheet
December 31, 1993 1992
Intangibles:
Excess of cost over net assets acquired $219,781 $212,066
Other intangibles 32,648 29,809
252,429 241,875
Accumulated amortization (68,189) (60,685)
$184,240 $181,190
Accrued expenses:
Dispositions and restructuring $35,143 $57,301
Insurance 22,985 20,376
Payroll and compensation 34,374 37,393
Profit sharing 7,271 8,218
Product guarantee and warranty 13,677 10,747
Sales commissions 12,023 11,514
Environmental and legal 18,004 24,842
Taxes other than income taxes 6,463 6,327
Other accrued expenses 27,889 3,626
$177,829 $180,344
Statement of Earnings
Year Ended December 31, 1993 1992 1991
Research and development(1) $63,725 $72,299 $66,827
Maintenance and repairs 14,656 16,365 15,288
Advertising 9,748 10,866 10,277
Royalty income 2,499 3,069 3,920
Statement of Cash Flows
Year Ended December 31, 1993 1992 1991
Cash paid during the year for:
Interest $ 23,614 $30,425 $30,795
Income taxes 26,695 17,015 5,586
Liabilities assumed in conjunction
with acquisitions:
Fair value of assets acquired $24,357 $68,478 $--
Cash paid (19,950) (57,306) --
$4,407 $11,172 $--
(1) Ongoing operations only. Excludes semiconductor and other divested
operations of $22,737 and $29,139 in 1992 and 1991, respectively.
<TABLE>
Eleven-Year Financial Summary
General Signal Corporation and Consolidated Subsidiaries
(In thousands, except per-share data)
Year Ended December 31,
<CAPTION>
1993 1992 1991 1990 1989 1988 1987 1986 1985 1984 1983
SUMMARY OF OPERATIONS
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Net sales 1,530,006 1,674,205 1,615,832 1,694,947 1,738,287 1,607,719 1,431,343 1,399,740 1,610,903 1,599,758 1,406,969
Cost of
sales 1,100,590 1,205,622 1,165,325 1,209,705 1,220,421 1,132,105 1,013,023 973,452 1,133,724 1,091,337 966,350
Selling,
general &
admin. 308,370 339,818 333,001 356,769 378,973 385,697 328,673 319,093 341,475 339,702 302,559
Dispositions
of
businesses
and
restruct. 10,100 85,600 -- 122,200 (8,679) 24,082 -- -- 72,000 -- --
Total
operating
costs and
expenses 1,419,060 1,631,040 1,498,326 1,688,674 1,590,715 1,541,884 1,341,696 1,292,545 1,547,199 1,431,039 1,268,909
Operating
earnings 110,946 43,165 117,506 6,273 147,572 65,835 89,647 107,195 63,704 168,719 138,060
Interest
expense, net (16,548) (24,379) (28,055) (31,466) (39,090) 1,917 2,400 (1,328) 666 4,965 4,127
Earnings
(loss) from
continuing
operations
before
income taxes 94,398 18,786 89,451 (25,193) 108,482 67,752 92,047 105,867 64,370 173,684 142,187
Income taxes 27,802 6,321 25,494 (11,917) 28,201 31,300 26,117 38,659 24,822 73,679 59,804
Earnings
(loss) from
continuing
operations 66,596 12,465 63,957 (13,276) 80,281 36,452 65,930 67,208 39,548 100,005 82,383
Discontinued
operations -- -- -- (5,449) (1,830) (11,254) 3,448 7,414 9,719 8,505 7,315
Disposal of
discontinued
operations -- -- (9,800) (14,208) -- -- -- -- -- -- --
Earnings
before
cumulative
effect
of
accounting
changes and
extra-
ordinary
charges 66,596 12,465 54,157 (32,933) 78,451 25,198 69,378 74,622 49,267 108,510 89,698
Extraordinary
charges (6,576) (330) -- -- -- -- -- -- -- -- --
Cumulative
effect of
accounting
changes (25,300) (92,400) -- -- -- -- -- -- -- -- --
Net earnings
(loss) $34,720 ($80,265) $54,157 ($32,933) $78,451 $25,198 $69,378 $74,622 $49,267 $108,510 $89,698
Per-share
Data
Earnings
(loss) per
share of
common
stock:
Continuing
operations $1.47<F1> $0.30<F2> $1.66 ($0.35) $2.11 $0.66 $1.17 $1.17 $.69 $1.75 $1.45
Discontinued
operations -- -- (0.26) (0.51) (0.05) (0.20) 0.06 0.13 0.17 0.15 0.13
Extraordinary
charges (0.14) (0.01) -- -- -- -- -- -- -- -- --
Cumulative
effect
of
accounting
changes (0.56) (2.21) -- -- -- -- -- -- -- -- --
Net earnings
(loss) $0.77 ($1.92) $1.40 ($0.86) $2.06 $0.46 $1.23 $1.30 $0.86 $1.90 $1.58
Cash
dividends
per share 0.90 0.90 0.90 0.90 0.90 0.90 0.90 0.90 0.90 0.86 0.84
Book value
per share 11.09 8.90 12.32 11.69 13.25 12.09 16.51 16.16 15.73 15.76 14.83
SUMMARY OF
FINANCIAL
POSITION
Working
capital 268,697 347,798 243,884 310,601 328,825 496,346 540,770 536,273 520,648 571,228 521,808
Property,
plant and
equipment 263,353 246,858 263,650 283,040 325,060 312,463 310,647 345,557 361,495 344,948 314,106
Total assets 1,224,841 1,258,428 1,180,198 1,294,633 1,324,341 1,396,600 1,397,397 1,458,106 1,483,232 1,438,431 1,314,413
Net long-
term debt 191,382 367,654 289,839 397,939 331,164 491,739 110,452 124,270 124,023 96,762 75,508
Shareholders'
equity 525,186 374,849 476,436 450,349 506,109 461,046 907,151 927,354 903,989 901,703 845,972
FINANCIAL
RATIOS
Working
capital
to sales 17.6% 20.8% 15.1% 18.3% 18.9% 30.9% 37.8% 38.3% 32.3% 35.7% 37.1%
Selling,
general and
admin.
expenses
to sales 20.2% 20.3% 20.6% 21.0% 21.8% 24.0% 23.0% 22.8% 21.2% 21.2% 21.5%
Operating
margin 7.3% 2.6% 7.3% 0.4% 8.5% 4.1% 6.2% 7.7% 4.0% 10.5% 9.8%
After-tax
return on
net sales 4.4% 0.7% 3.4% -1.9% 4.5% 1.6% 4.8% 5.3% 3.1% 6.8% 6.4%
Return on
average
share-
holders'
equity from
continuing
operations 13.9%<F1> 2.6%<F2> 13.8% -2.7% 16.8% 4.4% 7.2% 7.3% 4.3% 11.5% 10.1%
Current ratio 1.8 2.0 1.7 1.8 1.7 2.3 2.7 2.5 2.3 2.5 2.5
Net long-term
debt to
capital-
ization 26.7% 49.5% 37.8% 46.9% 39.6% 51.6% 10.9% 11.8% 12.1% 9.7% 8.2%
SUPPLEMENTAL
INFORMATION
Capital
expenditures 55,058 49,858 48,130 68,837 61,985 38,810 34,025 45,653 68,087 88,655 63,286
Depreciation
and
amortization
of
fixed assets 39,570 45,144 47,210 50,554 50,777 48,242 48,638 47,371 43,037 37,568 34,891
Research and
development 63,725 95,036 95,966 103,596 101,061 103,448 93,859 86,425 91,347 81,648 68,516
Common stock
price range:
High 37 7/8 32 5/8 26 7/8 29 5/8 28 7/8 28 1/4 30 5/8 27 1/8 26 7/8 27 26 1/8
Low 30 25 7/8 17 5/8 15 5/8 22 7/8 20 16 5/8 19 5/8 18 1/2 19 3/4 20 1/4
Price-
earnings
ratio range
- continuing
operations 19.3-15.3<F3>19.3-15.3<F3> 16.2-10.6 15.9-8.4 15.0-11.8 31.6-22.3 26.4-14.3 22.9-16.6 18.4-12.7 15.4-11.3 18.1-14.0
Average
common
shares
outstanding 45,205 41,753 38,572 38,398 38,112 55,418 56,478 57,460 57,412 57,136 56,828
Employees 12,901<F4> 14,095<F4> 14,738<F4> 15,790<F4> 19,377 19,082 19,126 20,180 22,312 24,129 23,530
<FN>
<F1> Excluding one-time charges, earnings per share is $1.96 and results in a return on equity of 15.4%.
<F2> Excluding the semiconductor charge and semiconductor operations for the first nine months of 1992, earnings per share is
<F2> $1.82 on sales of $1,539,354 and results in a return on equity of 15.3%.
<F3> Excludes cumulative effect of accounting changes, charges for disposition of businesses and restructuring, and transaction
<F3> and consolidation charges.
<F4> Excludes employees of businesses held for sale.
</TABLE>
Appendix A
Description of Graphic and Image material
At A Glance section
Pie Chart of Net Sales
Pie chart which plots the three product sector sales for 1993. The
title states "Net Sales"; "Dollars in millions". The legend states $722
Process Controls; $547 Electrical Controls; $261 Industrial Technology.
Pie Chart of Operatings Earnings
Pie chart which plots the three product sectors operating earnings
for 1993. The title states "Operating Earnings"; "Dollars in Millions." The
Operating Earnings title has a footnote reference (1) which states "Excludes
note (1), page 31." The legend states $71 Process Controls; $40 Electrical
Controls; $45 Industrial Technology.
Photos
On the next two pages there are photos which represent products that
were introduced by General Signal in 1993.
The legend to the left states "1993 - a record year for new
products."
Below is the Unit and a description of each product:
Aurora Pump Low-Flow, High-Head Sewage Pump
DeZurik Accutrax TM Blade Consistency Transmitter
Kinney Vacuum Liquid Ring Vacuum Pump
Leeds & Northrup Dew Point Transmitter
Lightnin MagMixer TM
Revco/Lindberg Blue M Convection Oven
Dielectric Communications DigiTLine,TM HDTV-ready Transmission Line
GS Building Systems Corporation Dual-Lite E-Z Snap,R LED Exit Sign
GS Electric Permanent Magnet Treadmill Motor
O-Z/Gedney Tek-Mate,TM Cable Terminator
Sola Electric 70 Uninterruptible Power System
Tau-tron 45 mbit/second Monitor Card
Telenex Corporation 2700 LAN/WAN Switching System
GFI Genfare Postal Service Stamp Vending Machine
Metal Forge Steering Center Link
Process Controls Section
Photos
Below is the description which appears to the left of each photo:
Photo 1
Layne & Bowler's 250 horsepower vertical pumps are designed to move
large quantities of water quickly at wastewater treatment plants such as this
one in New Jersey.
Photo 2
Researchers at Memorial Sloan-Kettering Cancer Institute in New York
City count on Revco ultra-low temperature freezers to preserve cell specimens
reliably.
Photo 3
Lightnin's new seal-less MagMixer,TM being readied here for
shipment, seals in fluids while sealing out contaminants and emissions during
the processing of pharmaceutical, chemical, and biotechnology products.
Bar Graphs
Process Controls Revenues Graph
Three dimensional bar graph which plots Process Controls product
sector revenues for the three years ended December 31, 1993, 1992 and 1991.
The numbers that appear in each bar are as follows: 1993 - $722; 1992 - $739;
1991 - $696. The caption below the graph states "Process Controls Revenues";
"Dollars in millions."
Process Controls Operating Earnings Graph
Three dimensional bar graph which plots Process Controls product
sector operating earnings for the three years ended December 31, 1993, 1992
and 1991. The numbers that appear in each bar are as follows: 1993 - $70.9;
1992 - $70.0; 1991 - $62.4. The caption below the graph states "Process
Controls Operating Earnings"; "Dollars in millions"; "Excludes note (1), page
31."
Electrical Controls section
Photos
Below is a description that appears to the left of each photo:
Photo 1
O-Z/Gedney's new rapid prototyping equipment now allows the unit to
bring cost-effective, competitive product ideas to customers in hours rather
than months.
Photo 2
Las Vegas' new Luxor hotel uses a sophisticated fire protection
system from Edwards Systems Technology to protect visitors to the hotel's
200,000 square foot casino, 2,500 guest rooms, and family-style entertainment
complex.
Photo 3
GS Electric expanded sales of its permanent magnet motors in 1993,
becoming the exclusive supplier for a popular new line of treadmills from
Proform Fitness Products, Inc.
Bar Graphs
Electrical Controls Revenue Graph
Three dimensional bar graph which plots Electrical Controls product
sector revenue for the three years ended December 31, 1993, 1992 and 1991.
The numbers that appear in each bar are as follows: 1993 - $547; 1992 - $568;
1991 - $515. The caption below the graph states "Electrical Controls
Revenues"; "Dollars in millions."
Electrical Controls Operating Earnings Graph
Three dimensional bar graph which plots Electrical Controls product
sector operating earnings for the three years ended December 31, 1993, 1992
and 1991. The numbers that appear in each bar are as follows: 1993 - $39.7;
1992 - $43.1; 1991 - $43.9. The caption below the graph states "Electrical
Controls Operating Earnings"; "Dollars in millions"; "Excludes the items
discussed on page 31."
Industrial Technology section
Photos
Below is a description which appears to left of each photo:
Photo 1
IBM's Business Recovery Services relies on the large port-capacity
and connectivity capabilities of the Telenex 2700 Mega-Matrix,R Switch to
provide subscribers with reliable access to computing and communications
equipment.
Photo 2
GFI used an established base of more than 42,000 bus fareboxes to
build sales for its add-on product, the Ticket Reader Issuer Machine
(TRIM,TM), in 1993.
Bar Graphs
Industrial Technology Revenues Graph
Three dimensional bar graph which plots Industrial Technology
product sector revenue for the three years ended December 31, 1993, 1992 and
1991. The numbers that appear in each bar are as follows: 1993 - $261; 1992 -
$233, 1991 - $213. The caption below the graph states "Industrial Technology
Revenues";"Dollars in millions"; "Excludes divested semicondoctor equipment
operations."
Industrial Technology Operating Earnings
Three dimensional bar graph which plots Industrial Technology
product sector operating earnings for the three years ended December 31, 1993,
1992 and 1991. The numbers that appear in each bar are as follows: 1993 -
$44.8; 1992 - $32.9; 1991 - $24.2. The caption below the graph states
"Industrial Technology Operating Earnings";"Dollars in millions"; "Excludes
divested semiconductor equipment operations."
Management's Discussion and Analysis of Financial Condition and Results
of Operations
Sales Graph
Three dimensional bar graph which plots sales for the three years
ended December 31, 1993, 1992 and 1991. The numbers that appear in each bar
are as follows: 1993 - $1,530; 1992 - $1,539; 1991 - $1,424. The caption
below the graph states "Sales"; "Dollars in millions"; "Excludes divested
semiconductor equipment operations."
Gross Profit Graph
Three dimensional bar graph which plots gross profit for the three
years ended December 31, 1993, 1992 and 1991. The numbers that appear in each
bar are as follows: 1993 - $452; 1992 - $452; 1991 - $415. The caption below
the graph states "Gross Profit"; "Dollars in millions"; "Adjusted to exclude
one-time items."
Net Interest Expense Graph
Three dimensional bar graph which plots net interest expense for the
three years ended December 31, 1993, 1992 and 1991. The numbers that appear
in each bar are as follows: 1993 - $17; 1992 - $24; 1991 - $28. The caption
below the graph states "Net Interest Expense"; "Dollars in millions."
Earnings from Continuing Operations Graph
Three dimensional bar graph which plots earnings from continuing
operations for the three years ended December 31, 1993, 1992 and 1991. The
numbers that appear in each bar are as follows: 1993 - $89; 1992 - $76; 1991 -
$64. The caption below the graph states "Earnings from Continuing
Operations";"Dollars in millions"; "Adjusted to exclude one-time items."
Working Capital Graph
Three dimensional bar graph which plots working capital for the
three years ended December 31, 1993, 1992 and 1991. The numbers that appear
in each bar are as follows: 1993 - $269; 1992 - $348; 1991 - $244. The
caption below the graph states "Working Capital"; "Dollars in millions."
Capital Expenditures and R&D Graph
Three dimensional bar graph which plots both capital expenditures
and research and development. The research and development numbers appear in
the bottom half of the bar graph and are the following: 1993 - $64; 1992 -
$72; 1991 - $67. The capital expenditures numbers appear at the top half of
the bar graph and are the following: 1993 - $55; 1992 - $50; 1991 - $48. The
caption below the graph states "Capital Expenditures and R&D"; "Dollars in
millions"; "Excludes divested semiconductor equipment operations."
Capitalization Graph
Three dimensional bar graph which plots both total capitalization
and the ratio of long-term debt to capitalization. The ratio of long- term
debt to capitalization appears in the bottom half of the graph and the
percentages are as follows: 1993 - 26.7%; 1992 - 49.5%; 1991 - 37.8%. The
capitalization numbers appear at the top half of the bar chart and are the
following: 1993 - $717; 1992 - $743; 1991 - $766. The caption below the graph
states "Capitalization"; "Dollars in millions."
