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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
__________
FORM 8-A/A-1
FOR REGISTRATION OF CERTAIN CLASSES OF SECURITIES PURSUANT TO
SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934.
Lone Star Industries, Inc.
(Exact name or registrant as specified
in its charter)
Delaware 13-0982660
(State of Incorporation (IRS Employer
or organization) Identification No.)
300 First Stamford Place, P.O. Box 120014
Stamford, Connecticut 06912-0014
(address of principal executive offices)
Securities to be registered pursuant to Section 12(b) of the Act:
Title of each class to Name of each exchange
be so registered on which each class
is to be registered
Common Stock,
per share $1.00 par value New York Stock Exchange
Common Stock New York Stock Exchange
Purchase Warrants
10% Senior Notes Due 2003 New York Stock Exchange
Securities to be registered pursuant to Section 12(g) of the Act:
None
(Title of Class)
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EXHIBIT INDEX On Page 18
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INFORMATION REQUIRED IN
REGISTRATION STATEMENT
Item 1. Description of Registrant's Securities to be
Registered.
The Registrant, Lone Star Industries, Inc., a Delaware
corporation (also referred to herein as the "Company"), presently files
reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of
1934, as amended (the "Exchange Act"), and is currently the subject of
reorganization proceedings pursuant to Chapter 11, Title 11 of the United
States Code (the "Bankruptcy Code"). Pursuant to the Registrant's
Modified Amended Plan of Reorganization, as amended (the "Plan of
Reorganization"), which was confirmed by order of the Bankruptcy Court for
the Southern District of New York on March 1, 1994, the Registrant has
been authorized to issue (i) 25,000,000 shares of Common Stock, par value
$1.00 per share ("Common Stock"), (ii) Common Stock Purchase Warrants to
purchase 4,003,333 shares of Common Stock (the "Warrants") and (iii)
$78,000,000 aggregate principal amount of its 10% Senior Notes Due 2003
(the "Notes") (the securities referred to in the foregoing clauses (i)
through (iii) are hereinafter collectively referred to as the
"Securities"). The Securities will be issued pursuant to Section 1145 of
the Bankruptcy Code. The Registrant has applied to the New York Stock
Exchange to list the Securities thereon.
The Registrant's existing Common Stock, par value $1.00
per share, and Preferred Stock Purchase Rights are currently listed on the
New York Stock Exchange. Pursuant to the Plan of Reorganization, all of
such existing securities will be cancelled on or about the date of
consummation of the Plan of Reorganization (the "Effective Date").
A. Common Stock
Holders of Common Stock are entitled to one vote per
share on all matters submitted to a vote of the stockholders, including
the election of directors. The Registrant's Amended and Restated
Certificate of Incorporation does not provide for cumulative voting for
the election of directors. The holders of Common Stock are entitled to
dividends as declared from time to time by the Board of Directors from
funds legally available therefor and such holders will be entitled to
receive pro rata all assets of the Registrant available for distribution
to such holders upon liquidation. No shares of Common Stock have any
preemptive rights to subscribe for additional shares of capital stock.
Shares of Common Stock issued pursuant to the Plan of Reorganization will
be duly authorized, fully paid and non-assessable.
Under the Indenture (as such term is hereinafter
defined), dividends on the Common Stock can be paid only in certain
circumstances and up to a maximum amount. See "Notes -- Restricted
Investments and Restricted Stock Payments" below. In addition, it is
anticipated that the agreement relating to the Permitted Working Capital
Loan, as defined below, which the Company anticipates entering into on or
about the Effective Date, will prohibit the payment of dividends by the
Registrant.
B. Warrants
The Warrants are non-callable, non-redeemable and
exercisable until December 31, 2000 at a price of $18.75 per share.
The number of shares of Common Stock purchasable upon the
exercise of each Warrant and the exercise price of the Warrant are subject
to adjustment if the Registrant (i) pays a dividend in shares of Common
Stock, (ii) subdivides its outstanding shares of Common Stock, (iii)
combines its outstanding shares of Common Stock into a smaller number of
shares of Common Stock, or issues by reclassification or recapitalization
of its shares of Common Stock, other securities of the Registrant or (iv)
issues certain stock
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rights convertible into, or exchangeable for, Common Stock. An adjustment
will not result from the Registrant's sale of Common Stock on the open
market or the declaration of regular cash dividends.
C. Notes
The Notes will be issued under an indenture to be dated
as of March 29, 1994 (the "Indenture") between the Registrant and Chemical
Bank, as trustee (the "Trustee"). The terms of the Notes include those
stated in the Indenture and those made part of the Indenture by reference
to the Trust Indenture Act of 1939 (the "Trust Indenture Act") as in
effect on the date of the Indenture. The Notes are subject to all such
terms, and reference is made to the Indenture and the Trust Indenture Act
for a statement thereof. The following summary of certain provisions of
the Indenture does not purport to be complete and is qualified in its
entirety by reference to the Indenture, including the definitions therein.
Copies of the proposed forms of Indenture and Notes are incorporated
herein by reference at Exhibit 6. Capitalized terms used herein and not
otherwise defined herein shall have the meanings as defined in the
Indenture.
Certain Definitions
Set forth below is a summary of certain of the defined
terms used in the Indenture. Reference is made to the Indenture for the
full definition of all such terms as well as any other capitalized terms
used herein for which no definition is provided.
"Adjusted Consolidated Net Income" means, with respect to
the period commencing on the Effective Date and continuing through the
last day of the fiscal quarter of the Registrant immediately preceding the
date of determination (i) the sum of fifty percent of the Consolidated Net
Income for each fiscal year or partial fiscal year in such period minus
(ii) the sum of one hundred percent of the Consolidated Net Losses for
each fiscal year or partial fiscal year in such period.
"Affiliate" means any Person directly or indirectly
controlling or controlled by or under common control with the Company or
any Guarantor, as the case may be; provided, however, that the term
Affiliate, with respect to the Company, will not include any wholly-owned
Restricted Subsidiary of the Company. For this purpose, "control" means
possession, directly or indirectly, of the power to direct or cause the
direction of the management or policies of a Person, whether through the
ownership of voting securities, by contract or otherwise.
"Average Life to Stated Maturity" means, with respect to
any Indebtedness, at any date of determination, the quotient obtained by
dividing (a) the sum of the products of (i) the number of years from such
date to the date or dates of each successive scheduled principal payment
(including, without limitation, any sinking fund requirements) of such
Indebtedness multiplied by (ii) the amount of each such principal payment
by (b) the sum of all such principal payments.
"Board of Directors" means the Board of Directors of any
Person or any committee of the Board authorized to act for it hereunder.
"Capital Stock" means any shares, interests,
participations, rights in or other equivalents (however designated) of
such Person's capital stock, and any rights (other than debt securities
convertible into capital stock), warrants or options exchangeable for or
convertible into such capital stock.
"Capitalized Lease" means, at the time any determination
thereof is to be made, any lease of property, real or personal, in respect
of which the present value of the minimum rental commitment would be
capitalized on a balance sheet of the lessee in accordance with GAAP.
"Capitalized Rent" under any Capitalized Lease will mean,
at any time as of which the amount thereof is to be determined, the lesser
of (i) 10 times the amount of the maximum net rent payable under such
lease during any period of 12 consecutive months subsequent to the date as
of which the rental obligation is to
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be determined and (ii) the lesser of (x) the aggregate amount of net rent
payable under such lease until the expiration thereof in accordance with
its terms and (y) the aggregate amount of net rent payable thereunder
until the first date as of which the lessee will have the right to
terminate such lease, together with any other payments required on the
part of the lessee to effect such termination. The net rent payable under
any lease for any period will be the total amount of the rent payable by
the lessee with respect to such period but will not include amounts
required to be paid on account of maintenance and repairs, insurance,
taxes, assessments, water rates and similar charges. The amount to be
included in net rent for any given period with respect to any portion
thereof which may be a variable will be such amount as the Registrant will
in good faith determine is reasonably to be expected to be due as a result
of such variable.
"Cash Equivalents" means, at any time: (i) any evidence
of Indebtedness with a maturity of 180 days or less issued or directly and
fully guaranteed or insured by the United States of America or any agency
or instrumentality thereof (provided that the full faith and credit of the
United States of America is pledged in support thereof); (ii) certificates
of deposit or acceptances with a maturity of 180 days or less of any
financial institution that is a member of the Federal Reserve System
having combined capital and surplus and undivided profits of not less than
$500,000,000; (iii) commercial paper with a maturity of 180 days or less
issued by a corporation that is not an Affiliate of the Company organized
under the laws of any state of the United States or the District of
Columbia and rated at least A-1 by S&P or at least P-1 by Moody's or at
least an equivalent rating category of another nationally recognized
securities rating agency; (iv) repurchase agreements and reverse
repurchase agreements, in each case maturing within 180 days from the date
of acquisition, collateralized by marketable direct obligations issued or
unconditionally guaranteed by the government of the United States of
America or issued by any agency thereof and backed by the full faith and
credit of the United States of America; provided that the terms of such
agreements comply with the guidelines set forth in the Federal Financial
Agreements of Depository Institutions With Securities Dealers and Others,
as adopted by the Comptroller of the Currency on October 31, 1985; and (v)
money market funds described in clause (v) of the definition of Permitted
Investments.
"Change of Control" means (a) a sale of all or
substantially all of the assets of the Company as an entirety to any
person (within the meaning of Rule 13d-3 under the Exchange Act and
Sections 13(d) and 14(d) of the Exchange Act), (b) the approval by the
stockholders of the Company of a plan of liquidation or dissolution, or
(c) any person or group (within the meaning of Rule 13d-5 under the
Exchange Act and Section 13(d) and 14(d) of the Exchange Act) becoming,
directly or indirectly, the "beneficial owner," as defined in Rule 13d-3
under the Exchange Act (in a single transaction or in a related series of
transactions, by way of merger, consolidation or other business
combination or otherwise), of greater than 50% of the total voting power
entitled to vote in the election of directors, managers or trustees of the
Company or such other person surviving the transaction.
"Consolidated Net Income (Loss)", with respect to any
period subsequent to the Effective Date, means net income (or loss) of the
Company and its Subsidiaries, other than Rosebud, Construction Aggregates
and any Subsidiary referred to in clause (A)(i) of the definition of
Restricted Subsidiary (as set forth below), all as consolidated (except as
expressly provided herein) and determined in accordance with GAAP but
excluding, without duplication, (i) all extraordinary gains or losses (net
of fees and expenses relating to the transaction giving rise thereto);
(ii) net income (or loss) of any Person combined with such Person or one
of its Subsidiaries on a "pooling of interests" basis attributable to any
period prior to the date of combination; (iii) gains or losses in respect
of Sales of Assets (net of fees and expenses relating to the transaction
giving rise thereto and on an after-tax basis); (iv) the net income of any
Subsidiary to the extent that the declaration of dividends or similar
distributions by that Subsidiary of that income is not at the time
permitted, directly or indirectly, by operation of the terms of its
charter or any agreement, instrument, judgment, decree, order, statute,
rule or governmental regulations applicable to that Subsidiary or its
stockholders; and (v) any net income of any Person who is not a
wholly-owned Subsidiary (except to the extent of the amount of dividends
or distributions actually paid in cash to the Company or a wholly- owned
Subsidiary of the Company during such period, but not in excess of the
Company's pro rata share of such Person's net income).
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"Consolidated Net Worth" means the total assets of a
Person and its Restricted Subsidiaries minus the total liabilities of a
Person and its Restricted Subsidiaries, as consolidated (except for the
exclusion of Subsidiaries which are not Restricted Subsidiaries) and
determined in accordance with GAAP; provided, however, when determining
the Consolidated Net Worth of a Person and its Restricted Subsidiaries for
purposes of Section 5.01(iv) of the Indenture, New York Trap Rock and NYTR
Transportation will be excluded.
"Construction Aggregates" means Construction Aggregates
Limited, a corporation organized under the laws of Nova Scotia.
"Default" means any event which is, or after notice or
passage of time or both would be, an Event of Default.
"Dividends" means any dividends declared by a Person on
its Capital Stock (other than (i) dividends payable to the Company or
dividends payable by Subsidiaries of a Restricted Subsidiary to such
Restricted Subsidiary, (ii) dividends payable solely in Capital Stock of
the Company and (iii) dividends required under the terms of Preferred
Stock of a Restricted Subsidiary permitted under Section 4.10 of the
Indenture).
"EBITDA" means, in respect of any period subsequent to
the Effective Date, the Consolidated Net Income (or Consolidated Net
Loss), plus (i) any amounts that were deducted from revenues in
determining such Consolidated Net Income (or Consolidated Net Loss) in
respect of depreciation, amortization and Interest Expense, (ii) the
aggregate amount of any provisions (or minus any credits) for federal,
state, and local franchise, income and similar taxes (including taxes
based on capital), and (iii) without duplication, the aggregate amount of
all non-cash charges to Consolidated Net Income (or Consolidated Net
Loss); minus (a) non-cash items increasing Consolidated Net Income and (b)
interest income.
"Employee Settlement Agreements" means settlement
agreements in effect on the Effective Date with (i) the PBGC, (ii) the
Official Committee of Retired Employees of the Registrant and its
Subsidiaries and (iii) the Unions, and all related agreements, documents
and instruments, as amended, modified and supplemented from time to time
to the extent permitted under Section 4.16(d) of the Indenture.
"ERISA" means the Employee Retirement Income Security Act
of 1974, as amended from time to time.
"ERISA Controlled Group" means a group which includes the
Registrant and which is treated as a single employer under Section 414(b)
or (c) of the Internal Revenue Code of 1986, as amended.
"Event of Default" has the meaning assigned to such term
in Section 6.01 of the Indenture.
"Excepted Lease" means (i) any lease existing on the
Effective Date and renewals or extensions thereof and (ii) any lease
between the Registrant or any Restricted Subsidiary (other than New York
Trap Rock and NYTR Transportation) and the Registrant or any wholly-owned
Restricted Subsidiary (other than New York Trap Rock and NYTR
Transportation) and (iii) any lease which is a Trap Rock Permitted
Transaction.
"Excess Net Proceeds" means at any date of determination,
the excess of (i) all Net Proceeds received from time to time subsequent
to the Effective Date during the Company's fiscal year (or portion
thereof) in which such date occurs by the Registrant or any Restricted
Subsidiary over (ii) $2 million.
"Fair Value" means fair market value as determined in
good faith by the Board of Directors of the Registrant.
"First Fiscal Year" means the first four complete fiscal
quarters following the Effective Date.
"GAAP" means generally accepted accounting principles in
effect from time to time.
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"Guarantee" means the Guarantee set forth in Article 10
of the Indenture to be made for the benefit of the holders of Notes from
time to time by the Guarantors.
"Guarantee Agreement" means the Guarantee Agreement,
dated of even date with the Indenture, between the Company and Chemical
Bank, as trustee, pursuant to which the Company has guaranteed the payment
of a portion of certain Asset Proceeds Notes issued by Rosebud pursuant to
a separate Indenture, dated as of the date hereof, between Rosebud and
Chemical Bank, as Trustee.
"Guarantor" means each Restricted Subsidiary in existence
from time to time other than New York Trap Rock and NYTR Transportation.
"Incentive Compensation Plan" means the incentive
compensation plan for certain employees of the Registrant with respect to
the sale of assets of Rosebud as in effect on the Effective Date and any
replacement or modification thereto so long as such replacement or
modification is not materially disadvantageous to the Holders or the
Registrant.
"Indebtedness" of any Person means, without duplication,
(a) all indebtedness for money borrowed, created, incurred or assumed by
such Person or guaranteed by such Person or for which it is otherwise
liable or responsible (such as by agreement to purchase indebtedness of
others), (b) all amounts owing by such Person under Purchase Money
Indebtedness or other purchase money liens or conditional sales or other
title retention agreements, (c) all indebtedness secured by any mortgage,
pledge or other lien or encumbrance upon property owned by such Person,
even though such Person has not assumed or become liable for the payment
of such indebtedness, (d) all Capitalized Rent under any Capitalized Lease
(other than Excepted Leases), (e) the lowest mandatory or optional
redemption price or liquidation value of outstanding Preferred Stock
issued by such Person, if a Restricted Subsidiary, and owned by any Person
other than the Registrant or another Restricted Subsidiary, (f) all
obligations under any agreement relating to the fixing of interest rates
on any Indebtedness, such as an interest rate swap, cap or collar
agreement if and to the extent the same would constitute a liability on
the balance sheet of such Person prepared in accordance with GAAP and (g)
all obligations in respect of standby letters of credit issued at the
request of such Person; provided, however, that the term Indebtedness
excludes (i) trade payables and other accrued current liabilities incurred
in the ordinary course of business; (ii) any obligations to the Company or
any Restricted Subsidiary; (iii) any obligations arising from the
Production Payment Transaction, (iv) in the case of the Company, any
obligations arising under the Guarantee Agreement and (without limitation)
any obligations on any Payment Notes hereafter issued thereunder and (v)
any particular indebtedness if, upon or prior to the maturity thereof,
there shall have been deposited with the proper depository in trust money
(or evidences of such indebtedness if permitted by the instrument creating
such indebtedness) in the necessary amount to pay, redeem or satisfy such
indebtedness as and when due, and thereafter such money and evidences of
indebtedness so deposited shall not be included in any computation of the
assets of such Person. In determining the Indebtedness of the Company and
its Restricted Subsidiaries, any Indebtedness for which the Company and
one or more Restricted Subsidiaries or for which two or more Restricted
Subsidiaries are obligated shall be deemed to be Indebtedness of only one
such Person.
"Interest Expense" means, in respect of any period
subsequent to the Effective Date, (i) all interest charges on Indebtedness
of the Registrant and its Restricted Subsidiaries (and, in the case of
Preferred Stock included in the definition of Indebtedness, mandatory
dividends thereon when payable, regardless of when declared, other than
liquidating and similar dividends) paid or payable (or, with respect to
any original issue discount, accrued) in respect of such period, including
without limitation all late charges, funding cost adjustments, prepayment
and yield protection fees paid or payable in respect of Indebtedness, and
interest payable on obligations arising under the Production Payment
Transaction, during such period and (ii) 4% of the amount of all lease
payments (other than lease payments under Capitalized Leases) during such
period in connection with any sale-leaseback transaction entered into
after the date hereof.
"Interest Expense Ratio" means the ratio of (i) the
aggregate EBITDA for the four complete fiscal quarters (or such smaller
number of fiscal quarters as have elapsed since the Effective Date)
immediately preceding the date of calculation to (ii) the aggregate
Interest Expense for such four immediately preceding
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fiscal quarters (or shorter period, as the case may be); provided,
however, that in calculating the Interest Expense Ratio for purposes of
determining whether proposed Indebtedness may be incurred or a
sale-leaseback transaction may be entered into (A) Interest Expense will
be calculated on a pro forma basis giving effect to the incurrence of such
proposed Indebtedness or sale- leaseback transaction as if it were
incurred on the first day of such four fiscal quarter period and (B) if
the incurrence of such Indebtedness or the entering into of any
sale-leaseback transaction relates to any transaction proposed by the
Company (and otherwise permitted hereunder), any EBITDA, determined on a
pro forma basis, which the Company or its Subsidiaries would have received
had such transaction been consummated immediately prior to such four
fiscal quarter period (calculating, in the event of an acquisition, such
EBITDA, to the extent practicable, from actual financial results for the
appropriate period) will be included within the aggregate EBITDA
referenced in clause (i) above for purposes of such calculation.
"Inventory" means finished goods, work in process, repair
parts and supplies, fuels and packages, raw materials and goods in
transit.
"Investment" means, other than in the ordinary course of
business, providing any cash or assets to, or extending credit to, or
becoming liable in respect of, or otherwise providing for, payment of any
Indebtedness of, any Person, whether or not in exchange for securities of
any Person or other consideration.
"Kosmos" means Kosmos Cement Company, a Kentucky
partnership.
"Lien" means, with respect to any asset, any mortgage,
lien, pledge, charge, security interest or similar encumbrance in respect
of such asset, whether or not filed, recorded or otherwise perfected under
applicable law (including any conditional sale or other title retention
agreement, any Capitalized Lease in the nature thereof, and any filing of
or agreement to give any financing statement under the Uniform Commercial
Code or equivalent statutes of any jurisdiction other than an information
filing), but does not include, in the case of the Company and its
Restricted Subsidiaries, the lien granted to the Trustee under Section
7.07 of the Indenture.
"Management Services Agreement" means the management
services and asset disposition agreement in effect on the Effective Date
between the Registrant and Rosebud and its Subsidiaries and any
replacement or modification thereto so long as such replacement or
modification is not materially disadvantageous to the Holders or the
Registrant.
"Material Restricted Subsidiary" has the meaning assigned
to such term in Section 6.01 of the Indenture.
"Maturity Date" of the Securities means July 31, 2003.
"Moody's" means Moody's Investors Services, Inc. and its
successors.
"Multiemployer Plan" means a Plan which is a
multiemployer plan as defined in Section 4001(a)(3) of ERISA.
"Net Proceeds" with respect to any Sale of Assets, means
the cash (in U.S. dollars or currency freely convertible into U.S.
dollars) received from such Sale of Assets after (i) provision for all
income or other taxes measured by or resulting from such sale or other
disposition or the transfer of the proceeds thereof to the Registrant that
are payable by the Registrant or any of its Subsidiaries (as reasonably
and in good faith estimated by the Chief Financial Officer of the
Registrant or such Subsidiary), (ii) payment of all brokerage commissions,
legal and accounting fees and expenses and other fees and expenses related
to such sale or other disposition, (iii) deduction of any amounts required
to be paid to the lender pursuant to any Permitted Working Capital Loans
or West Nyack Indebtedness upon such Sale of Assets to the extent actually
paid, (iv) deduction of amounts provided by the Registrant or its
Subsidiaries as a reserve on its regularly prepared balance sheets (or the
notes thereto), in accordance with GAAP consistently applied (including,
without limitation, subject to the next
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succeeding sentence, all amounts escrowed, pledged or otherwise set aside
to assume payment of such liabilities), against any liabilities associated
with the assets sold in such Sale of Assets and retained by the Registrant
or its Subsidiaries, including, without limitation, trade payables,
payroll and pension and other employment and postemployment benefit
liabilities and liabilities related to environmental matters, or against
any indemnification obligations associated with the sale or other
disposition, (v) deduction of amounts set aside in good faith for the
construction, acquisition or improvement of assets as contemplated by
clause (D) of the proviso to the definition of "Sale of Assets," and (vi)
deduction of any amounts required to discharge any Permitted Liens on the
assets sold, leased, conveyed or otherwise disposed of. Net Proceeds (i)
will not include any proceeds from the transfer of the Non-Core Assets
pursuant to the Plan of Reorganization but (ii) will include, when
received in cash (x) any Net Proceeds from the sale or other disposition
of any non-cash proceeds received by the Registrant or any of its
Subsidiaries from a Sale of Assets and (y) any Net Proceeds released from
escrow, pledge or other set aside pursuant to the contract, settlement or
other instrument or document governing such aspect of the Sale of Assets
and amounts no longer reserved or set aside as described in clause (iv) or
(v), respectively, of the immediately preceding sentence.
"New York Trap Rock" means New York Trap Rock
Corporation, a Delaware corporation.
"NYTR Transportation" means NYTR Transportation Corp., a
Delaware corporation.
"Officer" means the Chairman of the Board, the President,
any Senior Vice-President, Executive Vice-President or any other
Vice-President, the Treasurer or the Secretary of the Registrant or a
Guarantor, as the case may be.
"Officers' Certificate" means a certificate signed by any
two Officers of the Registrant or a Guarantor, as the case may be.
"Opinion of Counsel" means a written opinion from legal
counsel who is reasonably acceptable to the Trustee. Such counsel may be
an employee of or counsel for the Registrant, the Trustee or a Guarantor
or other counsel.
"Payment Notes" has the meaning assigned to such term in
the Guarantee Agreement.
"PBGC" means the Pension Benefit Guaranty Corporation.
"Permitted Acquisitions" means (i) any acquisition of
assets in the ordinary course of business and (ii) if approved by the
Board of Directors of the Registrant, any acquisition out of the ordinary
course of business (including by way of merger or consolidation) of
Capital Stock or other equity interests (but not of less than 100% of such
Capital Stock or other equity interests then outstanding other than
director's qualifying shares) or assets of, any person (provided such
Capital Stock, equity interests or assets primarily relate to a line of
business in which the Company or a Subsidiary is operating immediately
prior to such acquisition); provided, in the case of either clause (i) or
(ii), that neither the Registrant nor any Restricted Subsidiary of the
Registrant (other than the acquired Person and its Subsidiaries) incurs
any liability, contingent or otherwise, for the payment of any deferred
portion of the purchase price therefor, other than Purchase Money
Indebtedness, or for any Indebtedness, obligation or liability, contingent
or otherwise, other than any such liability, contingent or otherwise,
which the Registrant could incur without violation of the Indenture, For
purposes of this definition, "ordinary course of business" shall exclude
any acquisition of all or substantially all of the Capital Stock or assets
of a Person, a division or line of business.
"Permitted Investment" means (i) any Investment in the
Registrant or any Restricted Subsidiary (whether or not such Person is a
Restricted Subsidiary before such Investment) other than New York Trap
Rock and NYTR Transportation; (ii) Investments in obligations of, or
guaranteed by the United States government or any agency or political
subdivision thereof; (iii) Investments in commercial paper issued by
corporations maturing within 180 days from the date of the original issue
thereof, and rated "P-1" or better by Moody's or "A-1" or better by S&P or
an equivalent rating or better by any other nationally recognized
securities rating
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agency; (iv) Investments in certificates of deposit issued or acceptances
accepted by or guaranteed by any bank or trust company organized under the
laws of the United States of America or any state thereof or the District
of Columbia, in each case having capital, surplus and undivided profits
totalling more than $500,000,000 maturing within one year of the date of
purchase; (v) money market funds organized under the laws of the United
States of America or any state thereof that invest substantially all of
their assets in any of the types of Investments described in clause (ii),
(iii) or (iv) above or (xii) below including funds held by Chemical Bank
(e.g. the "Hanover Fund"); (vi) any additional Investments in, or
purchases of additional interests in, Kosmos; (vii) one or more capital
contributions to Rosebud on or before the Effective Date in a maximum
aggregate amount of $5 million and any advance to Rosebud or its
Subsidiaries or Affiliates permitted under the Management Services
Agreement; (viii) any Investment in Construction Aggregates, provided the
aggregate amount of such Investments net of cash repayments during the
appropriate period, will not exceed $2 million in any successive 12-month
period and will not when aggregated with Investments described in clause
(xiii) below exceed $5 million in the First Fiscal Year; (ix) any
Investments required pursuant to any agreement existing on the date
hereof; (x) Permitted Acquisitions; (xi) non-cash consideration received
in a Sale of Assets or series of related Sales of Assets, to the extent
permitted in Section 4.13 of the Indenture; (xii) Cash Equivalents; (xiii)
Investments in any Affiliates during the First Fiscal Year in the
aggregate amount of not more than $5 million; (xiv) other Investments
expressly required by the Plan of Reorganization; and (xv) Trap Rock
Permitted Transactions.
"Permitted Liens" means (i) Liens which may be granted
from time to time to secure and/or maintain Permitted Working Capital
Loans; (ii) Liens provided for or expressly contemplated by the Plan of
Reorganization or existing on the Effective Date; (iii) Liens in favor of
the Trustee on all property and funds held or collected by the Trustee as
security for the performance by the Registrant of its obligations of
payment to, and reimbursement and indemnification of, the Trustee for its
services under the Indenture and any similar liens in favor of the trustee
under any indenture under which the Payment Notes may be issued; (iv)
Liens for taxes or assessments and similar charges, or imposed in
connection with litigation or asserted claims, either not delinquent or
contested in good faith by appropriate proceedings and as to which the
Registrant or a Subsidiary shall have set aside on its books such reserves
as it deems adequate (provided such reserves will be in accordance with
GAAP); (v) Liens incurred, or pledges and deposits made, in connection
with workers' compensation, unemployment insurance and other social
security benefits, or securing the performance of leases, statutory
obligations, progress payments, surety and appeal bonds and other
obligations of like nature, but only to the extent any of the foregoing
are incurred in good faith in the ordinary course of business; (vi) Liens
imposed by law, such as mechanics', carriers', warehousemen's,
materialmen's and vendors' Liens, incurred in good faith in the ordinary
course of business either in respect of amounts not delinquent or
contested in good faith by appropriate proceedings as to which the
Registrant or a Subsidiary will have set aside on its books such reserves
as it deems adequate (provided such reserves will be in accordance with
GAAP); (vii) zoning restrictions, easements, licenses, covenants,
reservations, restrictions on the use of real property or irregularities
of title incident thereto that do not in the aggregate materially detract
from the value of the property or assets of the Registrant or any of its
Subsidiaries, as the case may be, or materially impair the use of such
property in the operation of the Registrant's or any Subsidiary's
business; (viii) Liens created by Restricted Subsidiaries of the
Registrant to secure Indebtedness of such Restricted Subsidiaries to the
Registrant or to any wholly-owned Restricted Subsidiaries (other than New
York Trap Rock and NYTR Transportation) thereof; (ix) any Lien on any
asset acquired as a part of a Permitted Acquisition; (x) Liens on the
Capital Stock or other securities of any Unrestricted Subsidiary or any
asset (including the stock of any Subsidiary thereof) of any Unrestricted
Subsidiary to secure Indebtedness of such Unrestricted Subsidiary; (xi)
Liens on assets acquired in connection with the incurrence of Purchase
Money Indebtedness in accordance with the definition thereof; (xii) Liens
granted in connection with the incurrence of Refinancing Indebtedness in
accordance with the definition thereof; (xiii) Liens securing Employee
Settlement Agreements; (xiv) Liens required under the Production Payment
Transaction in accordance with the definition thereof; (xv) any Liens on
the West Nyack, New York, plant and related facilities of the Company
and/or its Restricted Subsidiaries incurred in connection with West Nyack
Indebtedness; (xvi) Liens under Capital Leases and sale and leaseback
transactions, each to the extent permitted under Section 4.10 of the
Indenture; (xvii) Liens on the Capital Stock of Rosebud to secure the
Registrant's obligations under the Guarantee Agreement or any Payment
Notes issued thereunder; (xviii) other Liens expressly required to be
granted under the Plan of Reorganization; (xix) any other Liens existing
from
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time to time securing obligations not exceeding, in the aggregate, $1.5
million; and (xx) Liens hereafter created to replace other Permitted Liens
to the extent they secure the same obligations and are in property having
an aggregate value no greater than the property subject to the replaced
Lien.
"Permitted Working Capital Loans" means Indebtedness for
money borrowed under committed revolving credit or similar committed
facilities for working capital purposes, or the issuance of letters of
credit pursuant to any such facility, which facility may or may not be
secured by a lien on assets customary for working capital loans (which
shall not include real property or tangible assets (other than Inventory)
relating to physical facilities) including, without limitation, cash,
Inventory, general intangibles, Receivables and/or the Capital Stock of
Construction Aggregates and Subsidiaries of the Company (other than
Rosebud and its Subsidiaries, New York Trap Rock and NYTR Transportation)
with total assets with a book value greater than or equal to $500,000, and
proceeds thereof, that the Registrant or any Restricted Subsidiary of the
Registrant may have from time to time, to the extent that the aggregate
principal amount of all such Indebtedness outstanding under all such
facilities at any time does not exceed the greater of (i) $35 million or
(ii) the sum of 85% of the book value of the Receivables of the Registrant
and its Restricted Subsidiaries and 60% of the book value of the Inventory
of the Registrant and its Restricted Subsidiaries.
"Person" means any individual, corporation, partnership,
joint venture, association, joint-stock company, trust, unincorporated
organization, or government or any agency or political subdivision
thereof.
"Plan" means any employee benefit plan covered by Title
IV of ERISA, the funding requirements of which:
(i) were the responsibility of the Registrant
or a member of its ERISA Controlled Group at any time within the five
years immediately preceding the date hereof for which the Registrant or a
member of its ERISA Controlled Group reasonably could expect to incur
liability under Section 4069 or 4212(c) of ERISA,
(ii) are currently the responsibility of the
Registrant or a member of its ERISA Controlled Group, or
(iii) hereafter becomes the responsibility of
the Registrant or a member of its ERISA Controlled Group, including any
such plans as may, within the last five years prior to the Effective Date,
have been, or may hereafter be, terminated for whatever reason.
"Preferred Stock", as applied to the stock of any Person,
means any class of stock of such Person which has a preference in respect
of dividends of such Person or other distribution of assets, or in respect
of amounts payable in the event of any voluntary or involuntary
liquidation, dissolution and winding up of such Person, over any other
class of stock of such Person.
"Production Payment Transaction" means the Second Amended
and Restated Conveyance of Production Payments and the Second Amended and
Restated Marketing Agreement, each dated as of March 29, 1994, the Amended
and Restated Option Agreement and the Amended and Restated Expense and
Interest Agreement, each dated as of September 1, 1988, all such documents
between the Registrant and John Fouhey, as Trustee for Selleck Hill Trust,
and all related documents and instruments, as each of the foregoing may
have been amended, amended and restated or supplemented on or prior to the
Effective Date.
"Purchase Money Indebtedness" means any Indebtedness
incurred by the Registrant or any of its Restricted Subsidiaries in
connection with the acquisition or construction by the Registrant or such
Restricted Subsidiary, after the Effective Date, of equipment or other
fixed assets, including Indebtedness incurred to finance, refinance or
refund the cost (including the cost of construction) of such assets;
provided that a) the principal amount of such Indebtedness does not exceed
75% of the Fair Value of the assets being acquired or the cost of
construction paid by or charged to the Registrant or such Restricted
Subsidiary and b) such
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Indebtedness shall not be secured by any assets of the Registrant or any
Restricted Subsidiary other than the assets acquired or constructed with
the proceeds of such Indebtedness.
"Receivables" means all "accounts", all "chattel paper",
all "documents", all "instruments" evidencing "accounts" and all proceeds
thereof, as each such term is defined in the Uniform Commercial Code as in
effect in the State of New York on the Effective Date.
"Refinancing Indebtedness" means Indebtedness, the
proceeds of which are used to extend, renew, refinance or refund then
outstanding Indebtedness of the Registrant or its Restricted Subsidiaries
permitted under this Indenture, if such refinancing or refunding
Indebtedness (i) does not have a principal amount in excess of the
principal amount of the Indebtedness being so refinanced or refunded, plus
customary fees, expenses and costs related to the incurrence of such
Refinancing Indebtedness; (ii) gives its holders collateral with no
greater value (as determined by the Registrant's Board of Directors) and
no more guaranties from the Registrant and its Subsidiaries (other than
Unrestricted Subsidiaries) than the Indebtedness being refinanced; (iii)
has an Average Life to Stated Maturity no shorter than the Indebtedness
being refinanced; and (iv) is at least as junior or no more senior in
right of payment to the Notes, as the case may be, as the Indebtedness
being refinanced (it being understood that the fact that such Indebtedness
is secured by a Permitted Lien or guaranteed by an Unrestricted Subsidiary
will not cause the Indebtedness to be excluded from the definition of
Refinancing Indebtedness under this clause (iv)).
"Reportable Event" shall have the meaning set forth in
Section 4043(b) of ERISA other than a Reportable Event as to which the
provision of 30 days notice to the PBGC is waived under applicable
regulations), or is the occurrence of the events described in Section
4068(f) or 4063(a) of ERISA.
"Restricted Stock Payments" means any payment on account
of the purchase, redemption or other retirement of any shares of Capital
Stock or any other distribution in respect thereof (other than Dividends,
payments to the Registrant or by Subsidiaries of a Restricted Subsidiary
to such Restricted Subsidiary, dividends payable solely in Capital Stock
of the Registrant and dividends required under the terms of Preferred
Stock of a Restricted Subsidiary permitted under Section 4.10 of the
Indenture).
"Restricted Subsidiary" means, for any time of
determination: (A) any Subsidiary which has assets with a book value at
such time in excess of $1,000,000 (as reflected in the Registrant's most
recent audited consolidated financial statements) other than: (i) a
Subsidiary substantially all of the physical properties of which are
located, and substantially all of the business of which is carried on,
outside the limits of the United States of America (including Alaska and
Hawaii) or which is organized under the laws of any jurisdiction other
than the United States of America, the District of Columbia, the
Commonwealth of Puerto Rico, or the States or the possessions of the
United States; (ii) a Subsidiary the primary business of which consists of
purchasing accounts receivable and/or making loans secured by accounts
receivable or providing services directly related thereto, or which is
otherwise primarily engaged in the finance business or in the real estate
business; (iii) Rosebud, its Subsidiaries and its and their
successors-in-interest; or (iv) Construction Aggregates; (B) any
Subsidiary specified in clause (i), (ii), or (iv) of clause (A) above
which the Registrant, by resolution of the Board of Directors, shall have
designated as a Restricted Subsidiary; and (C) New York Trap Rock and NYTR
Transportation.
"Rosebud" means Rosebud Holdings, Inc., a Delaware
corporation and a Subsidiary of the Registrant.
"S&P" means Standard & Poor's Corporation and its
successors.
"Sale of Assets" means any sale, lease or other
conveyance (including by way of merger or consolidation) of assets
(including the Capital Stock of any Subsidiary of the Registrant but
excluding the Capital Stock of the Registrant) of (i) the Registrant or
any Restricted Subsidiary or (ii) any Unrestricted Subsidiary to the
extent and solely to the extent that the Registrant or any Restricted
Subsidiary actually receives a distribution of some or all of the Net
Proceeds of such sale, lease or conveyance; provided, however, that the
term "Sale of
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Assets" does not include (A) any consolidation or merger involving the
Registrant or any Subsidiary for the purpose of reincorporating the
Registrant or such Subsidiary in another jurisdiction; (B) any sale,
lease, conveyance or other disposition of assets (including by way of
merger or consolidation) (x) by the Registrant to one or more of its
wholly-owned Restricted Subsidiaries (other than New York Trap Rock or
NYTR Transportation) or (y) by a wholly-owned Restricted Subsidiary (other
than New York Trap Rock or NYTR Transportation) to the Registrant or
another wholly-owned Restricted Subsidiary (other than New York Trap Rock
or NYTR Transportation) or (z) between New York Trap Rock and NYTR
Transportation; (C) any sale, lease or conveyance required under the
Production Payment Transaction; (D) any sale, lease, conveyance or other
disposition of assets of the Registrant or any Subsidiary to the extent
the proceeds thereof are reinvested substantially contemporaneously with
their receipt in the construction, acquisition or improvement of assets by
the Registrant and/or any Restricted Subsidiary which the Board of
Directors has in good faith determined will be useful in the business to
be conducted by the Registrant or such Restricted Subsidiary; (E) any sale
of Receivables provided such sale is without recourse to the Registrant or
its Restricted Subsidiaries or any sale of Receivables with recourse to
the Registrant or its Restricted Subsidiaries provided such sale is
Indebtedness permitted under the Indenture; (F) any sale, assignment,
transfer, lease, conveyance or other disposition of assets that is
governed by and permitted under the provisions of Article 5 of the
Indenture; (G) any sale, assignment, transfer, lease, conveyance or other
disposition of assets that is in the ordinary course of business (it being
agreed that, for purposes of this definition, "ordinary course of
business" shall not include any sale, assignment, transfer, lease,
conveyance or other disposition of all or substantially all of the assets
or Capital Stock of a Subsidiary or all or substantially all of the assets
of a division or line of business) or (H) any sale, assignment, transfer,
lease, conveyance or other disposition of any property, right or interest
of the Registrant or any Subsidiary to Rosebud or any of its Subsidiaries
or Affiliates as contemplated by the Plan of Reorganization. For purposes
of this Indenture, a reinvestment of proceeds shall be considered
substantially contemporaneous if (1) the Board of Directors of the
appropriate Person has approved the construction, acquisition or
improvement within 12 months before or 6 months after the consummation of
the sale, lease or other conveyance of assets and (2) such company shall
have entered into a definitive agreement for such construction,
acquisition or improvement or shall have commenced such construction,
acquisition or improvement within 12 months after such sale, assignment,
transfer, lease, conveyance or other disposition.
"Subsidiary" shall mean any Person more than 50% of the
outstanding voting stock of which is owned, directly or indirectly, by the
Registrant or by one or more other Subsidiaries. For the purposes of this
definition, "voting stock" means stock or partnership interests or any
other equity interest which ordinarily has voting power for the election
of directors or, if the Person is not a corporation, voting power to
direct the management of such Person, whether at all times or only so long
as no senior class of stock or equity has such voting power by reason of
any contingency.
"Termination Event" shall mean (i) a Reportable Event, or
(ii) the initiation of any action by the Registrant, any member of the
Registrant's ERISA Controlled Group or any ERISA Plan fiduciary to
terminate an ERISA Plan or the treatment of an amendment to an ERISA Plan
as a termination under Section 4041(c) of ERISA, or (iii) the institution
of proceedings by the PBGC under Section 4042 of ERISA to terminate an
ERISA Plan or to appoint a trustee to administer any ERISA Plan.
"Trap Rock Permitted Transaction" means (i) any lease or
purchase of assets or services by or from the Registrant or any Restricted
Subsidiary from or by New York Trap Rock or NYTR Transportation on terms
no less favorable to the Registrant or such Restricted Subsidiary than
would be obtained in an arms' length transaction; (ii) any borrowings by
New York Trap Rock or NYTR Transportation directly or indirectly through
the Registrant of the proceeds of Permitted Working Capital Loans or West
Nyack Indebtedness; (iii) any capital contributions, loans or Investments
by the Registrant or any Restricted Subsidiary to or in New York Trap Rock
or NYTR Transportation for purposes of repairing or replacing its assets
or upgrading such assets for environmental or safety purposes or providing
for winter maintenance or extending their useful life, provided that any
such capital contribution, loan or Investment in excess of $1 million
shall be approved by the Registrant's Board of Directors; and (iv) any
transaction between New York Trap Rock and NYTR Transportation.
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"Unions" mean the International Brotherhood of
Boilermakers, Iron Ship Builders, Blacksmiths, Forgers and Helpers; the
United Paperworkers International Union; the United Steelworkers of
America; the International Brotherhood of Teamsters, Chauffeurs,
Warehousemen and Helpers, Local 445; the International Union of Operating
Engineers; the International Association of Machinists; and the Laborers
International Union of North America, Local 60.
"Unrestricted Subsidiary" shall mean any Subsidiary
which is not a Restricted
"U.S. Government Obligations" means direct non-callable
obligations of, or non-callable obligations guaranteed by, the United
States of America for the timely payment of which the full faith and
credit of the United States of America is pledged.
"West Nyack Indebtedness" means the first $25 million of
principal amount of Indebtedness from time to time outstanding (and
accrued interest thereon), including without limitation Capitalized
Leases, sale-leaseback transactions or any other kind of Indebtedness
incurred in connection with the West Nyack Modernization.
"West Nyack Modernization" means the proposed
modernization of the West Nyack, New York, plant and related facilities
owned by the Registrant and/or its Restricted Subsidiaries.
Paying Agent and Registrar
Principal of, and interest on the Notes will be payable,
and the Notes may be presented for registration of transfer or exchange,
at the offices or agencies of the respective Paying Agents and Registrars
in New York, New York. Holders must surrender the Securities to a Paying
Agent to collect principal payments. The initial Paying Agent and
Registrar is the Trustee. The Registrant may pay principal and interest
by check and may mail interest checks to the registered holders of the
Notes. The Registrant may require payment of a sum sufficient to cover
any transfer tax or similar governmental charge payable in connection with
certain transfers or exchanges. The Registrant or any of its subsidiaries
may act as Paying Agent or Registrar and the Registrant may change the
Paying Agent or Registrar without prior notice to holders of Notes. In
addition, if the Registrant fails to maintain a Registrar or Paying Agent,
the Trustee may act as such.
Maturity, Interest and Principal
The Notes will have a final maturity date of July 31,
2003 and will bear interest at an annual rate of 10% with interest payable
semiannually on January 31 and July 31 of each year. Interest will be
computed on the basis of a 360 day year of twelve 30-day months. The
Notes will be issued in the original aggregate principal amount of
$78,000,000.
The Notes will be general unsecured obligations of the
Registrant; however, the Notes may be entitled to the benefit of the
Guarantee.
Denominations
Notes will be issued in registered form without coupons
only in $1,000 denominations and in integral multiples of $1,000.
Optional Redemption; Open Market Purchases
The Notes will be subject to redemption (otherwise than
through the mandatory redemption described below) upon at least 30 days'
notice, at any time in whole, or from time to time in part, at the
election of Registrant, at a redemption price equal to 100% of their
principal amount, together with accrued and unpaid interest, if any, to
the date fixed for redemption ("Redemption Price"). If less than all the
Notes are to
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<PAGE> 14
be redeemed, the Trustee will select the Notes or portions thereof to be
redeemed pro rata by lot or such other method as the Trustee considers
fair and equitable to the holders of the Notes.
The Notes may also be purchased by the Registrant on the
open market from time to time, without penalty or premium.
Mandatory Redemption
Upon a Sale of Assets, the Excess Net Proceeds derived
therefrom are to be deposited with the Trustee within 45 days after the
end of each fiscal quarter of the Registrant; provided, however, if the
Registrant has determined in good faith to reinvest substantially
contemporaneously all or any portion of the Net Proceeds derived from any
such Sale of Assets in the construction, acquisition or improvement of
assets by the Registrant and/or any Restricted Subsidiary, then those Net
Proceeds will not be available for deposit with the Trustee. If at any
time there is at least $5,000,000 of Excess Net Proceeds on deposit with
the Trustee, all such monies will be used by the Trustee to redeem the
Notes at the Redemption Price. The amount of any such deposited monies
will be reduced by the principal amount of any Notes that the Registrant
has (during a period commencing with the public announcement that a Sale
of Assets has occurred in respect of which a deposit of Excess Net
Proceeds is expected to be made and ending on the earlier of (i) ninety
days after the date of such announcement or (ii) the date on which the
deposit is required to be made in accordance with the first sentence of
this paragraph) optionally redeemed or purchased and delivered to the
Trustee for cancellation ("Redemption Credit Securities").
Sinking Fund
Commencing in the year 2000, the Registrant is required
to make three annual payments of $10,000,000 each into a sinking fund
account maintained with the Trustee for redemption of the Notes. The
amount of any such required sinking fund account will be reduced, without
duplication, by the principal amount of any Notes that the Registrant has
optionally redeemed or purchased and delivered to the Trustee for
cancellation; provided, however, that no such reduction shall be made in
respect of any Redemption Credit Securities.
Guarantee
The Registrant is obligated to cause each Guarantor to
unconditionally guarantee the due and punctual payment of the principal
of, and interest on, the Notes.
Upon any Sale of Assets permitted by the terms of the
Indenture, or any transaction which would be a Sale of Assets if not for
the provisions of clause (D) of the definition of Sale of Assets, which,
in either case, consists of all of the Capital Stock of a Guarantor or the
sale of substantially all of the assets of a Guarantor, such Guarantor's
obligations in respect of the Guarantee will be released.
In addition, if any Guarantor ceases to be a Restricted
Subsidiary by virtue of its having had total assets with a book value of
less than $1,000,000 on the last day of each of any four consecutive
fiscal quarters of the Registrant, such Guarantor will be released from
its obligation under the Guarantee.
Restricted Investments and Restricted Stock Payments
The Registrant will not itself, and will not permit any
Restricted Subsidiary to, declare any Dividends or make any Restricted
Stock Payment or Investment (other than Permitted Investments), unless, in
the case of Dividends, such Dividends are declared to be payable not more
than 60 days after the date of declaration and unless, in each case, after
giving effect to the proposed Dividend, Restricted Stock Payment or
Investment and to any other Dividends declared but not yet paid, at the
date (hereinafter called the "Computation Date") of such declaration (in
case of a Dividend) or of such Restricted Stock Payment or Investment (i)
the Registrant could incur $1.00 of additional Indebtedness under Section
4.10 of the Indenture
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without taking into consideration the proviso thereto, (ii) there is no
outstanding Default or Event of Default and (iii) the sum of:
(A) Adjusted Consolidated Net Income, plus:
(B) the aggregate amount of net cash proceeds to the
Registrant from sales subsequent to the Effective Date of shares of its
Capital Stock (other than Preferred Stock of a Restricted Subsidiary
permitted under Section 4.10 of the Indenture and other than sales to a
Subsidiary of the Registrant), plus:
(C) in the case of the disposition or repayment of
any Investment (other than Permitted Investments) if such Investment was
made by a Restricted Subsidiary or the Company after the Effective Date in
accordance with this Section 4.08, an amount equal to the lesser of the
return of capital to such Restricted Subsidiary or the Company, as the
case may be, with respect to such Investment and the cost of such
Investment, in either case, less the cost of the disposition of such
Investment;
shall be greater than the aggregate amount of all such Dividends declared
and Restricted Stock Payments and Investments (other than Permitted
Investments) made during the period commencing on the Effective Date and
continuing to and including the Computation Date;
provided, however, that without regard to the foregoing restrictions, (a)
the Registrant may retire any shares of any class of its Capital Stock by
exchange for, or out of the proceeds of the substantially concurrent sale
of, other shares of its Capital Stock, and neither any such retirement nor
any such proceeds so used shall be included in any computation provided
for above and (b) any Restricted Subsidiary may make any required payments
(including without limitation, dividend, sinking fund, and mandatory
redemption payments) on or in respect of any Preferred Stock of such
Restricted Subsidiary permitted under Section 4.10 of the Indenture. For
purposes of Section 4.08 of the Indenture, the issuance of Capital Stock
upon the conversion of any Indebtedness of the Registrant will be deemed
to constitute a sale for cash of such Capital Stock and the net proceeds
of such sale will be deemed to be an amount equal to the principal amount
of such Indebtedness, less applicable expenses and cash payments for
fractional shares.
For the purposes of any computation provided for above,
the amount of any Dividend declared or Restricted Stock Payment made in
property other than cash, and the amount of any Investment in a Person
other than a Restricted Subsidiary made through the transfer to it of any
such property, will be deemed to be the Fair Value of such property at the
time of declaration (in the case of Dividends) or at the time of payment
or distribution or the making of such Investment.
Certain Limitations on Indebtedness, etc.
The Registrant will not, and will not permit any
Restricted Subsidiary, directly or indirectly, to create, incur or assume
or guarantee or otherwise become liable or responsible for, any
Indebtedness, or enter into any sale-leaseback transaction (other than an
Excepted Lease) unless immediately thereafter and after giving effect
thereto, the Interest Expense Ratio shall be at least equal to 2.0:1.0;
provided, however, that nothing contained in the foregoing will prevent
the Registrant or any Restricted Subsidiary from creating, incurring or
assuming or guaranteeing or otherwise becoming liable or responsible for
(i) the Indebtedness evidenced by the Notes, (ii) any Refinancing
Indebtedness, (iii) any Permitted Working Capital Loans; (iv) any West
Nyack Indebtedness; and (v) other Indebtedness having an aggregate
outstanding principal amount of no more than $1.5 million.
Furthermore, the Registrant will not, and will not permit
any of its Restricted Subsidiaries to, create, incur, assume or suffer to
exist any Lien on any asset owned by the Registrant or any of its
Restricted Subsidiaries except Permitted Liens.
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Sales of Assets
The Registrant will not, and will not permit any of its
Restricted Subsidiaries to, consummate a Sale of Assets unless (i) the
Registrant or such Restricted Subsidiary, as the case may be, receives
consideration at the time of such Sale of Assets at least equal to the
Fair Value of the shares or assets sold or otherwise disposed of and (ii)
at least 80% of such consideration (including consideration described in
clause (D)) consists of (A) cash (which will be deemed to include amounts
subject to post-closing adjustments or contingencies and held in escrow or
payable pursuant to a promissory note maturing within 60 days of
consummation of such sale or disposition), (B) Cash Equivalents, (C)
readily marketable securities which the Registrant in good faith expects
to liquidate promptly following such Sale of Assets, (D) the assumption of
liabilities by the purchaser pursuant to such Sale of Assets (including,
in the case of the sale of the Capital Stock of a Restricted Subsidiary,
liabilities of such Restricted Subsidiary) or (E) assets which the Board
of Directors has in good faith determined to be a like kind swap or
similar swap or trade arrangement involving property intended to produce
business and/or tax benefits for the Registrant and its Restricted
Subsidiaries and (iii) if such Sale of Assets or series of related Sales
of Assets involves aggregate payments or value in excess of $5 million, it
will be approved by a majority of the directors of the Registrant who are
not also employees of the Registrant.
Change of Control
Upon the occurrence of a Change of Control, the
Registrant will be obligated to make an offer to purchase (a "Change of
Control Offer") and will, subject to the provisions described below,
purchase, on a Business Day (the "Change of Control Purchase Date") not
more than 90 nor less than 30 days following the occurrence of the Change
of Control, all of the then outstanding Notes at a purchase price (the
"Change of Control Purchase Price") equal to 100% of the principal amount
thereof plus accrued and unpaid interest, if any, to the Change of Control
Purchase Date. The Registrant will, subject to the provisions described
below, be required to purchase all Notes properly tendered into the Change
of Control Offer and not withdrawn.
Notice of a Change of Control Offer will be mailed by the
Registrant not later than the 60th day after the Change of Control to the
holders of Notes at their last registered addresses with a copy to each
Guarantor, the Trustee and the Paying Agent. The Change of Control Offer
will remain open from the time of mailing for at least 20 Business Days
and until 5:00 p.m., New York City time, on the Change of Control Purchase
Date.
On the Change of Control Purchase Date, the Registrant
will (i) accept for payment Notes or portions thereof (but only in
principal amounts which are integral multiples of $1,000) validly tendered
pursuant to the Change of Control Offer, (ii) deposit with the Paying
Agent money, in immediately available funds, sufficient to pay the Change
of Control Purchase Price of all Notes or portions thereof so tendered and
accepted, and (iii) deliver to the Trustee the Notes so accepted together
with an Officer's Certificate setting forth the Notes or portions thereof
tendered to and accepted for payment by the Registrant.
The Registrant will not be required to make a Change of
Control Offer upon a Change of Control if a third party makes the Change
of Control Offer in the manner, at the times and otherwise in compliance
with the requirements applicable to a Change of Control Offer made by the
Registrant and purchases all Notes validly tendered and not withdrawn
under such Change of Control Offer.
Events of Default
An "Event of Default" is defined in the Indenture to
mean, among other things, (i) failure by the Registrant or any Guarantor
to pay interest when the same becomes due and payable and continuance of
such failure for 30 days after such date; (ii) failure by the Registrant
or any Guarantor to pay principal when and as the same will become due and
payable, whether at maturity, upon acceleration, in connection with any
sinking fund payment obligation or redemption or otherwise or default
under any of the Registrant's purchase obligations with respect to a
Change of Control; (iii) default by the Registrant or any of its
Restricted
16
<PAGE> 17
Subsidiaries under any Indebtedness in excess of $1,000,000 or the
Employee Settlement Agreements, which default has resulted in an
acceleration thereof; (iv) one or more final judgments against the Company
or any of its Restricted Subsidiaries for payments of money which in the
aggregate exceed $1,000,000, occur and such judgments are not stayed or
otherwise rescinded; (v) failure by the Registrant or any of its
Restricted Subsidiaries to perform certain covenants in the Indenture and
continuance of such failure for 30 days after written notice is given to
the Registrant by the Trustee or to the Registrant and the Trustee by the
holders of 25% in principal amount of the Notes; (vi) certain events of
bankruptcy, insolvency or reorganization of the Registrant or any of its
Material Restricted Subsidiaries; (vii) any Termination Event with respect
to a Plan shall occur which could reasonably be expected to result in the
imposition of a Lien on the assets of the Registrant or any Restricted
Subsidiary under Title IV of ERISA in excess of $1,000,000; (viii) a
material Lien, other than a Permitted Lien, is imposed on any assets of
the Registrant or a member of its ERISA Controlled Group in favor of the
PBGC or a Plan; or (ix) the Registrant or a member of its ERISA Controlled
Group will partially or completely withdraw from a Multiemployer Plan
which withdrawal results in the imposition of withdrawal liability in
excess of $1,000,000 which remains unpaid or will be a "default" (as
defined in Section 4219(c)(5) of ERISA) with respect to payments of more
than $1,000,000 to a Multiemployer Plan resulting from the Registrant's or
a member of its ERISA Controlled Group's complete or partial withdrawal
(as described in Section 4203 or 4205 of ERISA). The Indenture provides
that the Trustee must, within 90 days after the occurrence of a Default,
give to the holders of the Notes notice of all uncured Defaults known to
it, provided that, except in the case of Default in payment on any Notes,
the Trustee will be protected in withholding notice if the Trustee in good
faith determines that the withholding of such notice is in the interest of
the holders of Notes.
The Registrant or any Guarantor will be required to
furnish to the Trustee within 120 days after the close of each fiscal year
ending after the Effective Date; and within 60 days after the end of each
of the first three fiscal quarters of the Registrant and such Guarantor,
an Officer's Certificate stating whether such officer knows of any Default
or Event of Default under the Indenture during such period, and the status
of each such Default or Event of Default.
The Trustee or the holders of not less than 25% in
principal amount of the Notes will be authorized, upon the happening of
any Event of Default specified in the Indenture, to declare all unpaid
principal and accrued interest on the Notes to the date of acceleration,
due and payable.
The holders of 66 2/3% in principal amount of the Notes
are authorized to waive any Default or Event of Default and rescind such
declaration if the Default or Event of Default, except a Default in the
payment of principal of or interest on any Notes, or a Default with
respect to a covenant or provision which cannot be modified or amended
without consent of the holder of each outstanding Note affected. Subject
to all provisions of the Indenture and applicable law, the holders of a
majority in principal amount of the Notes have the right to direct the
time, method and place of conducting any proceeding for any remedy
available to the Trustee, or exercising any trust or power conferred on
the Trustee.
Amendment, Supplement and Waiver
Subject to certain exceptions, the Indenture, the
Guarantee or the Notes may be amended or supplemented with the consent of
the holders of at least 66 2/3 percent in principal amount of the
respective issue of Notes then outstanding, and any existing Default or
compliance with any provision may be waived (other than a continuing
Default or Event of Default in the payment of principal or interest of any
Note) with the consent of the holders of 66 2/3 percent in principal
amount of Notes then outstanding. Without the consent of any holder of
Notes, the Company and the Trustee may amend or supplement the Indentures
or the Notes, among other things, to cure any ambiguity, defect or
inconsistency, to provide for uncertificated Notes in addition to or in
place of certificated Notes, to provide for the assumption of the
Registrant's obligations in the case of a merger or acquisition, in order
to effect the granting or release of the Guarantee with respect to any
Guarantor as permitted under the Indenture, or to make any change that
does not adversely affect the rights of any holder of the Notes.
17
<PAGE> 18
Without the consent of each holder affected, the Company
may not, among other things, reduce the principal amount of Notes whose
holders are necessary to consent to an amendment of the Indenture; reduce
the rate or change the interest payment time of any Note or alter the
redemption provisions with respect thereto; reduce the principal of or
change the fixed maturity of any Note; make any change in the provisions
concerning waiver of Defaults or Events of Default by holders of the Notes
or rights of holders to receive payment of principal or interest; waive a
Default in the payment of principal or interest on any Note; or change any
of the provisions in the Indenture relating to a Change of Control.
Item 2. Exhibits.
The following exhibits are being filed with each copy of
this Registration Statement:
1. The Plan of Reorganization (Incorporated by
reference to Exhibit A to Exhibit E to the Lone
Star Industries, Inc. Form T-3, File No.
022-22175, dated January 14, 1994, as filed by
the Registrant with the Securities and Exchange
Commission (hereinafter referred to as the
"January 1994 Form T-3").
2. Modification of Debtors' Plan of Reorganization
(Incorporated by reference to Exhibit 2 to the
Lone Star Industries, Inc. Form 8-K, File No.
1.001-06124, as filed with Securities and
Exchange Commission on March 8, 1994).
3. The Disclosure Statement (Incorporated by
reference to Exhibit E to the January 1994 Form
T-3).
4. Form of Amended and Restated Certificate of
Incorporation of Reorganized Lone Star
Industries, Inc. (Incorporated by reference to
Exhibit H to Exhibit E to the January 1994 Form
T-3).
5. Form of Warrant Agreement.*
6. Form of Indenture (Incorporated by reference to
Exhibit C to the Second Amendment, as filed with
the Securities and Exchange Commission on April
5, 1994, to the January 1994 Form T-3).
7. Form of Notes (a copy of the form of Notes is
attached to the Indenture incorporated by
reference at Exhibit 6 hereto).
__________________________________
* Filed herewith.
18
<PAGE> 19
Signature
Pursuant to the requirements of Section 12 of the
Securities Exchange Act of 1934, the Registrant has duly caused this
Registration Statement to be signed on its behalf by the undersigned,
thereto duly authorized.
Date: April 6, 1994 LONE STAR INDUSTRIES, INC.
By:/s/ John J. Martin
------------------------
John J. Martin
Senior Vice President,
General Counsel & Secretary
19
<PAGE> 20
EXHIBIT INDEX
EXHIBIT
NUMBER DESCRIPTION
------- -----------
1. The Plan of Reorganization (Incorporated by
reference to Exhibit A to Exhibit E to the Lone
Star Industries, Inc. Form T-3, File No.
022-22175, dated January 14, 1994, as filed by
the Registrant with the Securities and Exchange
Commission (hereinafter referred to as the
"January 1994 Form T-3").
2. Modification of Debtors' Plan of Reorganization
(Incorporated by reference to Exhibit 2 to the
Lone Star Industries, Inc. Form 8-K, File No.
1.001-06124, as filed with Securities and
Exchange Commission on March 8, 1994).
3. The Disclosure Statement (Incorporated by
reference to Exhibit E to the January 1994 Form
T-3).
4. Form of Amended and Restated Certificate of
Incorporation of Reorganized Lone Star
Industries, Inc. (Incorporated by reference to
Exhibit H to Exhibit E to the January 1994 Form
T-3).
5. Form of Warrant Agreement.*
6. Form of Indenture (Incorporated by reference to
Exhibit C to the Second Amendment, as filed with
the Securities and Exchange Commission on April
5, 1994, to the January 1994 Form T-3).
7. Form of Notes (a copy of the form of Notes is
attached to the Indenture incorporated by
reference at Exhibit 6 hereto).
__________________________________
* Filed herewith.
<PAGE> 1
EXHIBIT 5
WARRANT AGREEMENT
WARRANT AGREEMENT dated March __, 1994 between LONE STAR
INDUSTRIES, INC. (the "Company"), and CHEMICAL BANK, a New York banking
corporation, as Warrant Agent (the "Warrant Agent").
The Company proposes to issue Common Stock Purchase Warrants, as
hereinafter described (the "Warrants"), to purchase an aggregate of 4,003,333
shares (subject to adjustment as provided herein) of its Common Stock, $1.00
par value (the "Common Stock"), (the shares of Common Stock issuable on
exercise of the Warrants being referred to herein as the "Warrant Shares"),
pursuant to the Modified Amended Consolidated Plan of Reorganization of the
Company (the "Plan"). Each Warrant shall entitle the holder thereof to
purchase one share (subject to adjustment as provided herein) of Common Stock.
The Company wishes the Warrant Agent to act on behalf of the
Company and the Warrant Agent is willing to act in connection with the
issuance, separation, transfer, exchange and exercise of Warrants.
In consideration of the foregoing and for the purposes of
defining the terms and provisions of the Warrants and the respective rights and
obligations thereunder of the Company and the registered owners of the Warrants
(the "Holders"), the Company and the Warrant Agent hereby agree as follows:
SECTION 1. Appointment of Warrant Agent. The Company hereby
appoints the Warrant Agent to act as agent for the Company in accordance with
the instructions set forth in this Agreement, and the Warrant Agent hereby
accepts such appointment.
SECTION 2. Transferability and Form of Warrant.
2.1 Registration. The Warrants shall be numbered and shall be
registered in a Warrant Register as they are issued. The Company and the
Warrant Agent shall be entitled to treat the Holder of any Warrant as the owner
in fact thereof for all purposes and shall not be bound to recognize any
equitable or other claim to or interest in such Warrant on the part of any
other person.
2.2 Transfer. The Warrants shall be transferable only on the
books of the Company maintained at the principal office of the Warrant Agent
upon delivery thereof duly endorsed by the Holder or by his duly authorized
attorney or representative, or accompanied by proper evidence of succession,
assignment or authority to transfer. In all cases of transfer by an attorney,
the original power of attorney, duly approved, or a
<PAGE> 2
copy thereof, duly certified, shall be deposited and remain with the Warrant
Agent. In case of transfer by executors, administrators, guardians or other
legal representatives, duly authenticated evidence of their authority shall be
produced, and may be required to be deposited and remain with the Warrant Agent
in its discretion. Upon any registration of transfer, the Warrant Agent shall
countersign and deliver a new Warrant or Warrants to the persons entitled
thereto.
2.3 Form of Warrant. The text of the Warrant and the Purchase
Form shall be substantially as set forth in Exhibit A attached hereto. The
price per Warrant Share and the number of Warrant Shares issuable upon exercise
of each Warrant are subject to adjustment upon the occurrence of certain
events, all as hereinafter provided. The Warrant shall be executed on behalf
of the Company by its Chairman of the Board, President or one of its Vice
Presidents, under its corporate seal reproduced thereon attested by its
Secretary or an Assistant Secretary. The signature of any such officers on the
Warrants may be manual or facsimile.
Warrants bearing the manual or facsimile signature of individuals
who were at any time the proper officers of the Company shall bind the Company,
notwithstanding that such individuals or any one of them shall have ceased to
hold such office prior to the delivery of such Warrants or did not hold such
offices on the date of this Agreement.
Warrants shall be dated as of the date of countersignature
thereof by the Warrant Agent either upon initial issuance or upon division,
exchange, substitution or transfer.
SECTION 3. Countersignature of Warrants. The Warrants shall be
countersigned by the Warrant Agent (or any successor to the Warrant Agent then
acting as warrant agent under this Agreement) and shall not be valid for any
purpose unless so countersigned. Warrants may be countersigned, however, by
the Warrant Agent (or by its successor as warrant agent hereunder) and may be
delivered by the Warrant Agent, notwithstanding that the persons whose manual
or facsimile signatures appear thereon as proper officers of the Company shall
have ceased to be such officers at the time of such countersignature, issuance
or delivery. The Warrant Agent shall, upon written instructions of the
Chairman of the Board, President, one of the Vice Presidents or the Secretary
of the Company, countersign, issue and deliver Warrants entitling the Holders
thereof to purchase not more than 4,003,333 Warrant Shares (subject to Section
7 hereof and adjustment pursuant to Section 10 hereof) and shall countersign
and deliver Warrants as otherwise provided in this Agreement.
SECTION 4. Exchange of Warrant Certificates. Each Warrant
certificate may be exchanged for another certificate or certificates entitling
the Holder thereof to purchase a like aggregate number of Warrant Shares as the
certificate or certificates surrendered then entitle such Holder to purchase.
Any Holder desiring to exchange a Warrant certificate or certificates shall
make such request in writing delivered to the Warrant Agent, and shall
surrender, properly endorsed, the certificate or certificates to be so
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<PAGE> 3
exchanged. Thereupon, the Warrant Agent shall countersign and deliver to the
person entitled thereto a new Warrant certificate or certificates, as the case
may be, as so requested.
SECTION 5. Term of Warrants; Exercise of Warrants.
5.1 Term of Warrants. Subject to the terms of this Agreement,
each Holder shall have the right, which may be exercised until the close of
business on December 31, 2000, to purchase from the Company the number of fully
paid and nonassessable Warrant Shares which the Holder may at the time be
entitled to purchase on exercise of such Warrants.
5.2 Exercise of Warrants. Warrants may only be exercised for
the purchase of whole Warrant Shares. Warrants may be exercised upon surrender
to the Company at the principal office of the Warrant Agent, of the certificate
or certificates evidencing the Warrants to be exercised (except as otherwise
provided below), together with the form of election to purchase on the reverse
thereof duly filled in and signed, and upon payment to the Warrant Agent for
the account of the Company of the Warrant Price (as defined in and determined
in accordance with the provisions of Sections 9 and 10 hereof), for the number
of Warrant Shares in respect of which such Warrants are then exercised.
Payment of the aggregate Warrant Price shall be made in cash or by certified or
official bank check.
Subject to Section 6 hereof, upon such surrender of Warrants and
payment of the Warrant Price as aforesaid, the Company shall issue and cause to
be delivered with all reasonable dispatch to or upon the written order of the
Holder, and in such name or names as the Holder may designate, a certificate or
certificates for the number of full Warrant Shares so purchased upon the
exercise of such Warrants, together with cash, as provided in Section 12
hereof, in respect of any fractional Warrant Shares otherwise issuable upon
such exercise of Warrants. Such certificate or certificates shall be deemed to
have been issued and any person so designated to be named therein shall be
deemed to have become a holder of record of such Warrant Shares as of the date
of the surrender of such Warrants and payment of such Warrant Price, as
aforesaid; provided, however, that if, at the date of surrender of such
Warrants and payment of such Warrant Price, the transfer books for the Warrant
Shares or other class of stock purchasable upon the exercise of such Warrants
shall be closed, the certificates for the Warrant Shares in respect of which
such Warrants are then exercised shall be issuable as of the date on which such
books shall next be opened (whether before or after December 31, 2000) and
until such date the Company shall be under no duty to deliver any certificate
for such Warrant Shares; provided further, however, that the transfer books of
record, unless otherwise required by law, shall not be closed at any one time
for a period longer than twenty days. The rights of purchase represented by
the Warrants shall be exercisable, at the election of the Holders thereof,
either in full or from time to time in part and, in the event that a
certificate evidencing Warrants is exercised in respect of less than all of the
Warrant Shares purchasable on such exercise at any time prior to the date of
expiration of the
- 3 -
<PAGE> 4
Warrants, a new certificate evidencing the remaining Warrant or Warrants will
be issued, and the Warrant Agent is hereby irrevocably authorized to
countersign and to deliver the required new Warrant certificate or certificates
pursuant to the provisions of this Section and of Section 3 hereof and the
Company, whenever required by the Warrant Agent, will supply the Warrant Agent
with Warrant certificates duly executed on behalf of the Company for such
purpose.
SECTION 6. Payment of Taxes. The Company will pay all
documentary stamp taxes, if any, attributable to the initial issuance of
Warrant Shares upon the exercise of Warrants; provided, however, that the
Company shall not be required to pay any tax or taxes which may be payable in
respect of any transfer involved in the issue or delivery of any Warrants or
certificates for Warrant Shares in a name other than that of the registered
Holder of Warrants in respect of which such Warrant Shares are issued.
SECTION 7. Mutilated or Missing Warrants. In case any of the
certificates evidencing the Warrants shall be mutilated, lost, stolen or
destroyed, the Company shall issue, and the Warrant Agent shall countersign and
deliver in exchange and substitution for and upon cancellation of the mutilated
Warrant certificate, or in lieu of and substitution for the Warrant certificate
lost, stolen or destroyed, a new Warrant certificate of like tenor and
representing an equivalent right or interest; but only upon receipt of evidence
satisfactory to the Company and the Warrant Agent of such loss, theft or
destruction of such Warrant and indemnity, if requested, also satisfactory to
them. An applicant for such a substitute Warrant certificate shall also comply
with such other reasonable regulations and pay such other reasonable charges as
the Company or the Warrant Agent may prescribe.
SECTION 8. Reservation of Warrant Shares: Ownership of Warrants
by Company.
8.1 Reservation of Warrant Shares. There have been reserved,
and the Company shall at all times keep reserved, out of its authorized Common
Stock, a number of shares of Common Stock sufficient to provide for the
exercise of the rights of purchase represented by the outstanding Warrants.
The Transfer Agent for the Common Stock and every subsequent transfer agent for
any shares of the Company's capital stock issuable upon the exercise of any of
such rights of purchase will be irrevocably authorized and directed at all
times to reserve such number of authorized shares as shall be requisite for
such purpose. The Company will keep a copy of this Agreement on file with the
Transfer Agent or its successors and with every subsequent transfer agent for
any shares of the Company's capital stock issuable upon the exercise of the
rights of purchase represented by the Warrants. The Warrant Agent is hereby
irrevocably authorized to requisition from time to time from the Transfer Agent
or its successors the stock certificates required to honor outstanding Warrants
upon exercise thereof in accordance with the terms of this Agreement. The
Company will supply such Transfer Agent or its successors with duly executed
stock certificates for such purposes and will provide or otherwise make
available any cash which may be payable as provided in Section 12 hereof. All
Warrants
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<PAGE> 5
surrendered in the exercise of the rights thereby evidenced shall be cancelled
by the Warrant Agent and shall thereafter be delivered to the Company.
8.2 Ownership of Warrants by the Company. No provision of this
Agreement shall limit or restrict the rights of the Company, or any affiliate
of the Company, to acquire or hold any Warrant or exercise any rights as a
Holder thereof.
8.3 Cancellation of Warrants. In the event the Company shall
purchase or otherwise acquire Warrants, the same shall thereupon be delivered
to the Warrant Agent and be cancelled by it and retired. The Warrant Agent
shall cancel any Warrants (or portions thereof) surrendered for exchange,
substitution, transfer or exercise in whole or in part.
SECTION 9. Warrant Price. The price per share at which Warrant
Shares shall be purchasable upon exercise of Warrants (the "Warrant Price")
shall be $18.75, subject to adjustment pursuant to Section 10 hereof.
SECTION 10. Adjustment of Warrant Price and Number of Warrant
Shares. The number and kind of securities purchasable upon the exercise of
each Warrant and the Warrant Price shall be subject to adjustment from time to
time upon the happening of certain events, as hereinafter defined.
10.1 Mechanical Adjustments. The number of Warrant Shares
purchasable upon the exercise of each Warrant and the Warrant Price shall be
subject to adjustment as follows:
(a) In case the Company shall (i) pay a dividend in
shares of Common Stock or make a distribution in shares of Common Stock,
(ii) subdivide its outstanding shares of Common Stock, (iii) combine its
outstanding shares of Common Stock into a smaller number of shares of
Common Stock or (iv) issue by reclassification or recapitalization of
its shares of Common Stock other securities of the Company, the number
of Warrant Shares purchasable upon exercise of each Warrant immediately
prior thereto shall be adjusted so that the Holder of each Warrant shall
be entitled to receive the kind and number of Warrant Shares or other
securities of the Company which he or she would have owned or have been
entitled to receive after the happening of any of the events described
above, had such Warrant been exercised immediately prior to the
happening of such event or any record date with respect thereto. An
adjustment made pursuant to this paragraph (a) shall become effective
immediately after the effective date of such event retroactive to the
record date, if any, for such event.
(b) (i) In case the Company shall distribute to all
holders of its shares of Common Stock evidences of its indebtedness or
assets (excluding cash dividends or distributions payable out of
retained earnings or surplus and dividends or distributions referred to
in paragraph (a) above) or rights, options or warrants or
- 5 -
<PAGE> 6
convertible or exchangeable securities containing the right to subscribe
for or purchase shares of Common Stock, then in each case the number of
Warrant Shares thereafter purchasable upon the exercise of each Warrant
shall be determined by multiplying the number of Warrant Shares
theretofore purchasable upon the exercise of each Warrant by a fraction,
of which the numerator shall be the then current market price per share
of Common Stock (as defined in Section 10.1(c) hereof) on the date of
the public announcement of such distribution and of which the
denominator shall be the then current market price per share of Common
Stock, less the then fair value (as determined in good faith by the
Board of Directors of the Company, whose determination shall be
conclusive) of the portion of the assets or evidences of indebtedness so
distributed, or of such subscription rights, options or warrants or of
such convertible or exchangeable securities applicable to one share of
Common Stock. Such adjustment shall be made whenever any such
distribution is made, and shall become effective on the date of
distribution retroactive to the record date for the determination of
stockholders entitled to receive such distribution.
(ii) In case the Company shall grant or issue any
stock option, stock bonus share or other stock- related security or
right in any case which are exercisable for or convertible into Common
Stock (collectively, "Stock Rights") to management or employees of the
Company or any subsidiary thereof, or to any consulting or similar firm,
for providing management services to the Company or any such subsidiary,
pursuant to any compensatory performance or similar plan or arrangement
approved by the Board of Directors other than any Stock Rights for which
an adjustment is made under Section 10.1(b)(i) or any Stock Rights
granted pursuant to the Management Stock Option Plan and the Directors
Stock Option Plan described in the Company's Modified Amended Disclosure
Statement dated November 4, 1993 relating to the Plan, and the aggregate
price per share for which Common Stock is issuable upon exercise or
conversion of such Stock Rights (which shall include any per share
payment made to acquire such Stock Rights) shall be less than the
current market price of Common Stock as of the close of business on the
business day immediately preceding the date of grant of such Stock
Rights, then, upon the exercise or conversion of any such Stock Rights,
the number of Warrant Shares thereafter purchasable upon the exercise of
each Warrant shall be determined by multiplying the number of Warrant
Shares theretofore purchasable upon the exercise of each Warrant by a
fraction, the numerator of which shall be the sum of (A) the number of
shares of Common Stock outstanding on the business day immediately
preceding the date of exercise or conversion of such Stock Rights (the
"Outstanding Shares Amount"), and (B) the number of additional shares of
Common Stock issued upon the exercise or conversion of the Stock Rights
being exercised (the "Additional Shares Amount") and the denominator of
which shall be the sum of (x) the Outstanding Shares Amount, and (y) the
Additional Shares Amount multiplied by the aggregate price per share for
which Common Stock is issuable upon exercise or conversion of such Stock
Rights (which shall include any per share payment made to acquire such
Stock Rights on the date of their issuance) divided by the
- 6 -
<PAGE> 7
current market price per share of Common Stock as of the close of
business on the business day immediately preceding the date of grant of
such Stock Rights. Subject to Section 10.1(d), such adjustment shall be
made whenever any Stock Rights referred to in this Section 10.1(b)(ii)
are exercised or converted and shall be effective as of the date of such
exercise or conversion.
The provisions of this Section 10.1(b)(ii) shall not apply to any Stock
Rights granted to an underwriter or selling agent of securities of the
Company or any subsidiary thereof in connection with an underwriting or
sale of securities of the Company or any such subsidiary, and the
provisions of this Section 10.1(b)(ii) shall not be deemed to apply to a
right to purchase shares of Common Stock which constitutes an agreement
for the purchase and sale of Common Stock.
(c) For the purpose of any computation under Section
10.1(b) and Section 12 hereof, the current market price per share of
Common Stock at any date shall be the average closing price of the
Common Stock on the New York Stock Exchange (or other principal national
securities exchange on which the Company's Common Stock shall be then
traded), or if not then traded on such an exchange, the average
representative closing bid price of the Common Stock (if then traded in
the over-the-counter market) or the average closing price of the Common
Stock (if then traded on NASDAQ's National Market System) for the five
consecutive trading days ending the day prior to the date as of which
such computation is made. If the Common Stock is not so traded, the
current market price per share of Common Stock shall mean: (i) for
purposes of Section 12 hereof, the fair market value per share as
determined in good faith by or pursuant to directions provided by the
Board of Directors of the Company; and (ii) for purposes of Section
10.1(b) hereof, an amount determined by a nationally recognized
investment banking firm that is, in the judgment of the Board of
Directors of the Company, disinterested and independent with respect to
the determination for which it is being retained.
(d) No adjustment in the number of Warrant Shares
purchasable hereunder shall be required unless such adjustment would
require an increase or decrease of at least 1% in the number of Warrant
Shares purchasable upon the exercise of each Warrant; provided, however,
that any adjustments which by reason of this Section 10.1(d) are not
required to be made shall be carried forward and taken into account in
any subsequent adjustment. All calculations shall be made to the
nearest one-thousandth of a share.
(e) Whenever the number of Warrant Shares purchasable
upon the exercise of each Warrant is adjusted, as herein provided, the
Warrant Price payable upon exercise of each Warrant shall be adjusted by
multiplying such Warrant Price immediately prior to such adjustment by a
fraction, of which the numerator shall be the number of Warrant Shares
purchasable upon the exercise of each Warrant immediately prior to such
adjustment, and of which the denominator shall be the number of Warrant
Shares so purchasable immediately thereafter.
- 7 -
<PAGE> 8
(f) For the purpose of this Section 10.1, the term
"shares of Common Stock" shall mean (i) the class of stock designated as
the Common Stock of the Company at the date of this Agreement, or (ii)
any other class of stock resulting from successive changes or
reclassification of such shares consisting solely of changes in par
value, or from par value to no par value, or from no par value to par
value. In the event that at any time, as a result of an adjustment made
pursuant to paragraph (a) above, the Holders shall become entitled to
purchase any shares of the Company other than shares of Common Stock,
thereafter the number of such other shares so purchasable upon exercise
of each Warrant and the Warrant Price of such shares shall be subject to
adjustment from time to time in a manner and on terms as nearly
equivalent as practicable to the provisions with respect to the Warrant
Shares contained in Section 10.1(a) through Section 10.1(e), inclusive,
above, and the provisions of Section 5 and Sections 10.2 and 10.3
hereof, with respect to the Warrant Shares, shall apply on like terms to
any such other shares.
10.2 Voluntary Adjustment by the Company. The Company may at
its option, at any time during the term of the Warrants, reduce the then
current Warrant Price to any amount deemed appropriate by the Board of
Directors of the Company.
10.3 Notice of Adjustment. Whenever the number of Warrant
Shares purchasable upon the exercise of each Warrant or the Warrant Price of
such Warrant Shares is adjusted, as herein provided, the Company shall cause
the Warrant Agent promptly to mail by first class mail, postage prepaid, to
each Holder notice of such adjustment or adjustments and shall deliver to the
Warrant Agent a certificate of a firm of independent public accountants
selected by the Board of Directors of the Company (who may be the regular
accountants employed by the Company) setting forth the number of Warrant Shares
purchasable upon the exercise of each Warrant and the Warrant Price of such
Warrant Shares after such adjustment, setting forth a brief statement of the
facts requiring such adjustment and setting forth the computation by which such
adjustment was made. Such certificate shall be conclusive of the correctness
of such adjustment. The Warrant Agent shall be entitled to rely on such
certificate and shall be under no duty or responsibility with respect to any
such certificate, except to exhibit the same, from time to time, to any Holder
desiring an inspection thereof during reasonable business hours. The Warrant
Agent shall not at any time be under any duty or responsibility to any Holders
to determine whether any facts exist which may require any adjustment of the
Warrant Price or the number of Warrant Shares or other stock or property
purchasable on exercise thereof, or with respect to the nature or extent of any
such adjustment when made, or with respect to the method employed in making
such adjustment.
10.4 No Adjustment for Dividends. Except as provided in
subsection 10.1, no adjustment in respect of any dividend shall be made during
the term of a Warrant or upon the exercise of a Warrant.
- 8 -
<PAGE> 9
10.5 Preservation of Purchase Rights Upon Consolidation, etc.
In case of any consolidation of the Company with or merger of the Company into
another corporation or in case of any sale or conveyance to another corporation
of the property of the Company as an entirety or substantially as an entirety,
the Company or such successor or purchasing corporation, as the case may be, as
a condition to the effectiveness of such transaction shall execute with the
Warrant Agent an agreement that each Holder shall have the right thereafter
upon payment of the Warrant Price in effect immediately prior to such action to
purchase upon exercise of each Warrant the kind and amount of shares and other
securities and property which he would have owned or have been entitled to
receive after the happening of such consolidation, merger, sale or conveyance
had such Warrant been exercised immediately prior to such action. The Company
shall mail by first class mail, postage prepaid, to each Holder, notice of the
execution of any such agreement. Such agreement shall provide for adjustments,
which shall be as nearly equivalent as may be practicable to the adjustments
provided for in this Section 10. The provisions of this Section 10.5 shall
similarly apply to successive consolidations, mergers, sales or conveyances.
The Warrant Agent shall be under no duty or responsibility to determine the
correctness of any provisions contained in any such agreement relating either
to the kind or amount of shares of stock or other securities or property
receivable upon exercise of Warrants or with respect to the method employed and
provided therein for any adjustments.
10.6 Statement on Warrants. Irrespective of any adjustments
in the Warrant Price or the number or kind of shares purchasable upon the
exercise of the Warrants, Warrant certificates theretofore or thereafter issued
may continue to express the same price and number and kind of shares as are
stated in the Warrant certificates initially issuable pursuant to this
Agreement.
SECTION 11. Expiration of Warrants. At 5:00 p.m. E.S.T, on
December 31, 2000, all outstanding Warrants shall become void and all rights of
all holders thereof and thereunder and under this Agreement shall cease.
SECTION 12. Fractional Interests. The Company shall not be
required to issue fractional Warrant Shares on the exercise of Warrants. The
number of full Warrant Shares which shall be issuable upon the exercise of
Warrants shall be computed on the basis of the aggregate number of Warrant
Shares purchasable on exercise of the Warrants so presented. If any fraction
of a Warrant Share would, except for the provisions of this Section 12, be
issuable on the exercise of any Warrant (or specified portion thereof), the
Company shall pay an amount in cash equal to the then current market price per
Warrant Share (as defined in Section 10.1(c) above) multiplied by such
fraction.
SECTION 13. No Rights as Stockholders; Notices to Holders.
Nothing contained in this Agreement or in any of the Warrants shall be
construed as conferring upon the Holders or their transferees the right to vote
or to receive dividends or to consent to or receive notice as stockholders in
respect of any meeting of stockholders for the election of directors of the
Company or any other matter, or any rights whatsoever
- 9 -
<PAGE> 10
as stockholders of the Company. If, however, at any time prior to the
expiration of the Warrants and prior to their exercise, any of the following
events shall occur:
(a) the Company shall declare any dividend payable in
any securities upon its shares of Common Stock or make any distribution
(other than a cash dividend payable from retained earnings or surplus)
to the holders of its shares of Common Stock or effectuate any of the
other transactions described in Sections 10.1 (a) or 10.5 hereof;
(b) the Company shall offer or grant to the holders of
its shares of Common Stock any additional shares of Common Stock or
securities convertible into or exchangeable for shares of Common Stock
or any right to subscribe thereto; or
(c) a dissolution, liquidation or winding up of the
Company (other than in connection with a consolidation, merger, or sale
of all or substantially all of its property, assets, and business as an
entirety) shall be proposed,
then in any one or more of said events, the Company shall (a) give notice in
writing of such event to the Warrant Agent and the Holders as provided in
Section 19 hereof and (b) cause notice of such event to be published once in
The Wall Street Journal (National Edition), such giving of notice and
publication to be completed at least fifteen days prior to the date fixed as a
record date or the date of closing the transfer books for the determination of
the stockholders entitled to such dividend, distribution, or subscription
rights or to participate in any other transaction or event described in Section
10.1(a), or for the determination of stockholders entitled to vote on such
proposed dissolution, liquidation or winding up or other transaction or event
described in Section 10.5. Such notice shall specify such record date or the
date of closing the transfer books, as the case may be. Failure to publish or
mail such notice or any defect therein or in the publication or mailing thereof
shall not affect the validity of any action taken in connection with such
dividend, distribution or subscription rights, or proposed dissolution,
liquidation or winding up or other transaction or event.
SECTION 14. Disposition of Proceeds on Exercise of Warrants;
Inspection of Warrant Agreement. The Warrant Agent shall account promptly to
the Company with respect to Warrants exercised and concurrently pay the Company
all monies received by the Warrant Agent for the purchase of the Warrant Shares
through the exercise of such Warrants.
The Warrant Agent shall keep copies of this Agreement and any
notices given or received hereunder available for inspection by the Holders
during normal business hours at its principal office in New York, New York.
The Company shall supply the Warrant Agent from time to time with such numbers
of copies of this Agreement as the Warrant Agent may request.
- 10 -
<PAGE> 11
SECTION 15. Merger or Consolidation or Change of Name of Warrant
Agent. Any corporation into which the Warrant Agent may be merged or with
which it may be consolidated, or any corporation resulting from any merger or
consolidation to which the Warrant Agent shall be a party, shall be the
successor to the Warrant Agent hereunder without the execution or filing of any
paper or any further act on the part of any of the parties hereto, provided
that such corporation would be eligible for appointment as a successor Warrant
Agent under the provisions of Section 17 hereof. In case at the time such
successor to the Warrant Agent shall succeed to the agency created by this
Agreement, any of the Warrants shall have been countersigned but not delivered,
any such successor to the Warrant Agent may adopt the countersignature of the
original Warrant Agent and deliver such Warrants so countersigned; and in case
at that time any of the Warrants shall not have been countersigned, any
successor to the Warrant Agent may countersign such Warrants either in the name
of the predecessor Warrant Agent or in the name of the successor Warrant Agent;
and in all such cases Warrants shall have the full force provided in the
Warrants and in this Agreement.
In case at any time the name of the Warrant Agent shall be
changed and at such time any of the Warrants shall have been countersigned but
not delivered, the Warrant Agent may adopt the countersignatures under its
prior name and deliver such Warrants so countersigned; and in case at that time
any of the Warrants shall not have been countersigned, the Warrant Agent may
countersign such Warrants either in its prior name or in its changed name; and
in all such cases such Warrants shall have the full force provided in the
Warrants and in this Agreement.
SECTION 16. Concerning the Warrant Agent. The Warrant Agent
undertakes the duties and obligations imposed by this Agreement upon the
following terms and conditions, by all of which the Company and the Holders, by
their acceptance of Warrants, shall be bound:
16.1 Correctness of Statements. The statements contained
herein and in the Warrants shall be taken as statements of the Company and the
Warrant Agent assumes no responsibility for the correctness of any of the same
except such as describe the Warrant Agent or action taken by it. The Warrant
Agent assumes no responsibility with respect to the distribution of the
Warrants except as herein otherwise provided.
16.2 Breach of Covenants. The Warrant Agent shall not be
responsible for any failure of the Company to comply with the covenants
contained in this Agreement or in the Warrants to be complied with by the
Company.
16.3 Performance of Duties. The Warrant Agent may execute and
exercise any of the rights or powers hereby vested in it or perform any duty
hereunder either itself or by or through its attorneys or agents (which shall
not include its employees) and shall not be responsible for the misconduct of
any agent appointed with due care.
- 11 -
<PAGE> 12
16.4 Reliance on Counsel. The Warrant Agent may consult at
any time with legal counsel satisfactory to it (who may be counsel for the
Company) and the Warrant Agent shall incur no liability or responsibility to
the Company or to any Holder in respect of any action taken, suffered or
omitted by it hereunder in good faith and in accordance with the opinion or the
advice of such counsel.
16.5 Proof of Actions Taken. Whenever in the performance of
its duties under this Agreement the Warrant Agent shall deem it necessary or
desirable that any fact or matter be proved or established by the Company prior
to taking or suffering any action hereunder, such fact or matter (unless other
evidence in respect thereof be herein specifically prescribed) may be deemed
conclusively to be proved and established by a certificate signed by the
Chairman of the Board, the President, any Executive Vice President, the Chief
Financial Officer, any Vice President, the Treasurer or the Secretary of the
Company and delivered to the Warrant Agent; and such certificate shall be full
authorization to the Warrant Agent for any action taken or suffered in good
faith by it under the provisions of this Agreement in reliance upon such
certificate.
16.6 Compensation. The Company agrees to pay the Warrant
Agent reasonable compensation for all services rendered by the Warrant Agent in
the performance of its duties under this Agreement, to reimburse the Warrant
Agent for all expenses, taxes (other than taxes based on income) and
governmental charges and other charges of any kind and nature incurred by the
Warrant Agent in the performance of its duties under this Agreement, and to
indemnify the Warrant Agent and save it harmless against any and all
liabilities, including judgments, costs and counsel fees, for anything done or
omitted by the Warrant Agent in the performance of its duties under this
Agreement except as a result of the Warrant Agent's negligence or bad faith.
16.7 Legal Proceedings. The Warrant Agent shall be under no
obligation to institute any action, suit or legal proceeding or to take any
other action likely to involve expense unless the Company or one or more
Holders shall furnish the Warrant Agent with reasonable security and indemnity
for any costs and expenses which may be incurred, but this provision shall not
affect the power of the Warrant Agent to take such action as the Warrant Agent
may consider proper, whether with or without any such security or indemnity.
All rights of action under this Agreement or under any of the Warrants may be
enforced by the Warrant Agent without the possession of any of the Warrants or
the production thereof at any trial or other proceeding relative thereto, and
any such action, suit or proceeding instituted by the Warrant Agent shall be
brought in its name as Warrant Agent, and any recovery of judgment (other than
in respect of a claim under Section 16.6) shall be for the ratable benefit of
the Holders, as their respective rights or interests may appear.
16.8 Other Transactions in Securities of Company. The Warrant
Agent and any stockholder, director, officer or employee of the Warrant Agent
may buy, sell or deal in any of the Warrants, or other securities of the
Company or have a pecuniary interest in any transaction in which the Company
may be interested, or contract with the
- 12 -
<PAGE> 13
Company or otherwise act as fully and freely as though it were not Warrant
Agent under this Agreement. Nothing herein shall preclude the Warrant Agent
from acting in any other capacity for the Company or for any other legal
entity.
16.9 Liability of Warrant Agent. The Warrant Agent shall act
hereunder solely as agent, and its duties shall be determined solely by the
provisions hereof. The Warrant Agent shall not be liable for anything which it
may do or refrain from doing in connection with this Agreement except for its
own negligence or bad faith. Anything in this Agreement to the contrary
notwithstanding, in no event shall the Warrant Agent be liable for special,
indirect or consequential loss or damage of any kind whatsoever (including but
not limited to lost profits), even if the Warrant Agent has been advised of the
likelihood of such loss or damage and regardless of the cause.
16.10 Reliance on Documents. The Warrant Agent will not incur
any liability or responsibility to the Company or to any Holder for any action
taken in reliance on any notice, resolution, waiver, consent, order,
certificate, or other paper, document or instrument reasonably believed by it
to be genuine and to have been signed, sent or presented by the proper party or
parties.
16.11 Validity of Agreement, etc. The Warrant Agent shall not
be under any responsibility in respect of the validity of this Agreement or the
execution and delivery hereof (except the due execution hereof by the Warrant
Agent) or in respect of the validity or execution of any Warrant (except its
countersignature thereof) or in respect of the necessity or the extent of any
adjustment to the Warrant Price or the number of Warrant Shares purchasable
under a Warrant; nor shall the Warrant Agent by any act hereunder be deemed to
make any representation or warranty as to the authorization, reservation, value
or registration under securities laws of any Warrant Shares (or other stock) to
be issued pursuant to this Agreement or any Warrant, or as to whether any
Warrant Shares (or other stock) will, when issued, be validly issued, fully
paid and nonassessable, or as to the Warrant Price or the number or amount of
Warrant Shares or other securities or other property issuable upon exercise of
any Warrant or the method employed in making any adjustment to the foregoing.
16.12 Instructions from Company. The Warrant Agent is hereby
authorized and directed to accept instructions with respect to the performance
of its duties hereunder from the Chairman of the Board, the President, any
Executive Vice President, the Chief Financial Officer, any Vice President, the
Treasurer or the Secretary of the Company and to apply to such officers for
advice or instructions in connection with its duties, and shall not be liable
for any action taken or suffered to be taken by it in good faith in accordance
with instructions of any such officer or officers.
SECTION 17. Change of Warrant Agent. The Warrant Agent may
resign and be discharged from its duties under this Agreement by giving to the
Company sixty days' notice in writing. The Warrant Agent may be removed by
like notice to the Warrant Agent from the Company. If the Warrant Agent shall
resign or be removed or shall
- 13 -
<PAGE> 14
otherwise become incapable of acting, the Company shall appoint a successor to
the Warrant Agent. If the Company shall fail to make such appointment within a
period of sixty days after such removal or after it has been notified in
writing of such resignation or incapacity by the resigning or incapacitated
Warrant Agent or by any Holder (who shall with such notice submit his Warrant
for inspection by the Company), then any Holder may apply to any court of
competent jurisdiction for the appointment of a successor to the Warrant Agent.
Any successor warrant agent, whether appointed by the Company or such a court,
shall be a bank or trust company, in good standing, incorporated under the laws
of the United States of America or any state thereof and having at the time of
its appointment as warrant agent a combined capital and surplus of at least
$50,000,000, or a stock transfer company. After appointment, the successor
warrant agent shall be vested with the same powers, rights, duties and
responsibilities as if it had been originally named as Warrant Agent without
further act or deed; but the former Warrant Agent shall deliver and transfer to
the successor warrant agent any property at the time held by it hereunder, and
execute and deliver any further assurance, conveyance, act or deed necessary
for the purpose. Failure to file any notice provided for in this Section 17,
however, or any defect therein, shall not affect the legality or validity of
the resignation or removal of the Warrant Agent or the appointment of the
successor warrant agent, as the case may be. In the event of such resignation
or removal, the successor warrant agent shall mail, first class, to each
Holder, written notice of such resignation or removal and the name and address
of such successor warrant agent.
SECTION 18. Identity of Transfer Agent. Forthwith upon the
appointment of any subsequent transfer agent for the Common Stock, or any other
shares of the Company's capital stock issuable upon the exercise of the
Warrants, the Company will file with the Warrant Agent a statement setting
forth the name and address of such subsequent transfer agent.
SECTION 19. Notices. Any notice pursuant to this Agreement by
the Company or by any Holder to the Warrant Agent, or by the Warrant Agent or
by any Holder to the Company, shall be in writing and shall be mailed first
class, postage prepaid, or delivered (a) to the Company, at its offices at 300
First Stamford Place, Stamford, Connecticut 06912-0014 or (b) to the Warrant
Agent, to Chemical Bank, 450 West 33rd Street, 15th Floor, New York, New York
10001. Each party hereto may from time to time change the address to which
notices to it are to be delivered or mailed hereunder by similar notice in
writing to the other party.
Any notice mailed pursuant to this Agreement by the Company or
the Warrant Agent to the Holders shall be in writing and shall be mailed first
class, postage prepaid, or delivered to such Holders at their respective
addresses on the books of the Warrant Agent.
SECTION 20. Supplements and Amendments. The Company and the
Warrant Agent may from time to time supplement or amend this Agreement, without
the approval of any Holder in order to cure any ambiguity or to correct or
supplement any provision
- 14 -
<PAGE> 15
contained herein which may be defective or inconsistent with any other
provision herein, or to make any other provisions in regard to matters or
questions arising hereunder which the Company and the Warrant Agent may deem
necessary or desirable and which shall not be inconsistent with the provisions
of the Warrants and which shall not adversely affect the interests of the
Holders. Any supplement or amendment to this Agreement which would adversely
affect the interests of the Holders may be made by the Company and the Warrant
Agent only with the written approval of the Holders of a majority of the
outstanding Warrants and upon such approval, such supplement or amendment shall
be binding on all Holders; provided, however, that no supplement or amendment
that reduces the term of the Warrants set forth in Section 5.1, increases the
Warrant Price (except for adjustments pursuant to Section 10 hereof), or
affects the provisions of Section 10 hereof shall be effective with respect to
any Warrant without the written consent of the Holder of such Warrant.
SECTION 21. Successors. All the covenants and provisions of
this Agreement by or for the benefit of the Company or the Warrant Agent shall
bind and inure to the benefit of their respective successors and assigns
hereunder.
SECTION 22. Merger or Consolidation of the Company. The Company
will not merge or consolidate with or into any other corporation unless the
corporation resulting from such merger or consolidation (if not the Company)
shall expressly assume, by supplemental agreement satisfactory in form to the
Warrant Agent and executed by such resulting corporation and delivered to the
Warrant Agent, the due and punctual performance and observance of each and
every covenant and condition of this Agreement to be performed and observed by
the Company.
SECTION 23. Applicable Law. This Agreement and each Warrant
issued hereunder shall be governed by, and construed in accordance with, the
laws of the State of New York, without giving effect to any principles of
conflicts of law.
SECTION 24. Benefits of this Agreement. Nothing in this
Agreement shall be construed to give any person or corporation other than the
Company, the Warrant Agent, and the Holders any legal or equitable right,
remedy or claim under this Agreement; but this Agreement shall be for the sole
and exclusive benefit of the Company, the Warrant Agent and the Holders of the
Warrants.
SECTION 25. Counterparts. This Agreement may be executed in any
number of counterparts and each of such counterparts shall for all purposes be
deemed to be an original, and all such counterparts shall together constitute
but one and the same instrument.
- 15 -
<PAGE> 16
SECTION 26. Captions. The captions of the Sections and
subsections of this Agreement have been inserted for convenience only and shall
not be deemed part of or used in the construction of this Agreement.
IN WITNESS WHEREOF, the parties hereto have executed this
Agreement as of the date first above written.
LONE STAR INDUSTRIES, INC.
By:
------------------------------
Title:
---------------------------
CHEMICAL BANK, as Warrant Agent
By:
------------------------------
Title:
---------------------------
- 16 -
<PAGE> 17
VOID AFTER 5:00 P.M.
EASTERN STANDARD TIME
DECEMBER 31, 2000
No. Exhibit A
----------
Warrants
----------
LONE STAR INDUSTRIES, INC.
INCORPORATED UNDER THE LAWS OF THE STATE OF DELAWARE
COMMON STOCK PURCHASE WARRANTS
THIS CERTIFIES THAT, for value received _______________________,
the registered holder hereof, or registered assigns (the "Holder"), is entitled
to purchase from Lone Star Industries, Inc., a Delaware corporation (the
"Company"), subject to the terms and conditions hereof and of the Warrant
Agreement referred to below, at any time on or after the date of this Common
Stock Purchase Warrant (the "Warrant") and until 5:00 p.m. E.S.T. on December
31, 2000, at the purchase price of $18.75 per share (the "Warrant Price"), the
number of shares of Common Stock, par value $1.00 per share, of the Company
(the "Common Stock") which is initially equal to the number of Warrants set
forth above. The number of shares purchasable upon exercise of this Warrant and
the Warrant Price per share shall be subject to adjustment from time to time as
set forth in the Warrant Agreement referred to below.
This Warrant may be exercised in whole or in part by presentation
of this Warrant with the Purchase Form on the reverse side hereof duly executed
and simultaneous payment of the Warrant Price (subject to adjustment) at the
principal office of Chemical Bank (the "Warrant Agent"). Payment of such price
shall be made at the option of the Holder hereof in cash, by certified or
official check or any combination thereof.
This Warrant is one of a duly authorized issue of Warrants
evidencing the right to purchase initially an aggregate of up to 4,003,333
shares of Common Stock under and in accordance with a Warrant Agreement between
the Company and the Warrant Agent and is subject to the terms and provisions
contained in the Warrant Agreement, to all of which the Holder of this Warrant
by acceptance hereof consents. A copy of the Warrant Agreement may be obtained
for inspection by the Holder hereof upon written request to the Warrant Agent.
A - 1
<PAGE> 18
Upon any partial exercise of this Warrant, there shall be
countersigned and issued to the Holder hereof a new Warrant in respect of the
shares of Common Stock as to which this Warrant shall not have been exercised.
This Warrant may be exchanged at the office of the Warrant Agent by surrender
of this Warrant properly endorsed either separately or in combination with one
or more other Warrants for one or more new Warrants entitling the Holder
thereof to purchase the same aggregate number of shares as were purchasable on
exercise of the Warrant or Warrants exchanged. No fractional shares will be
issued upon the exercise of this Warrant, but the Company shall pay the cash
value of any fraction upon the exercise of one or more Warrants. This Warrant
is transferable at the office of the Warrant Agent in New York, New York in the
manner and subject to the limitations set forth in the Warrant Agreement.
The Holder hereof, until his or her transfer has been recorded on
the books of the Company, may be treated by the Company, the Warrant Agent, and
all other persons dealing with this Warrant as the absolute owner hereof for
any purpose and as the person entitled to exercise the rights represented
hereby, or to the transfer hereof on the books of the Company, any notice to
the contrary notwithstanding.
This Warrant does not entitle any Holder hereof to any of the rights of a
stockholder of the Company.
This Warrant shall not be valid or obligatory for any purpose
until it shall have been countersigned by the Warrant Agent.
DATED:
(Corporate Seal) LONE STAR INDUSTRIES, INC.
Attest:
By:
----------------------------
- ---------------------------- Title:
[Secretary] -------------------------
COUNTERSIGNED:
CHEMICAL BANK, as Warrant Agent
By:
----------------------------
Authorized Signature
Title:
-------------------------
A - 2
<PAGE> 19
LONE STAR INDUSTRIES, INC.
PURCHASE FORM
The undersigned hereby irrevocably elects to exercise the right
of purchase represented by the within Warrant Certificate for, and to purchase
thereunder, ___________ shares of the stock provided for therein, herewith
makes payment in full for such shares in the amount of $__________ by delivery
of cash and/or certified or official bank check, all in accordance with the
terms and conditions specified in the within Warrant Certificate and the
Warrant Agreement therein referred to, and requests that certificates for such
shares be issued in the name indicated below and delivered to the address
stated below:
- -------------------------------------------------------------------------------
(Please Print Name, Address and Social Security No.)
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
and, if said number of shares shall not be all the shares purchasable
thereunder, that a new Warrant Certificate for the balance remaining of the
Warrants under the within Warrant Certificate be registered in the name of the
undersigned Warrantholder or his or her Assignee as below indicated and
delivered to the address stated below.
DATED:
Name of Warrantholder or Assignee:
---------------------------------------------
(Please Print)
Address:
-----------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Signature:
-----------------------------------
Signature Guaranteed By: NOTE: The above signature must
correspond with the name as
written upon the face of this
- ------------------------------- Warrant Certificate in every
particular, without
alteration or enlargement or
any change whatever, unless
this Warrant has been
assigned.
A - 3
<PAGE> 20
ASSIGNMENT
(TO BE SIGNED ONLY UPON ASSIGNMENT OF WARRANT)
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and
transfers unto
- -------------------------------------------------------------------------------
(Name and Address of Assignee Must Be Printed or Typewritten)
the within Warrant, hereby irrevocably constituting and appointing ____________
attorney to transfer said Warrant on the books of the Company, with full power
of substitution in the premises.
DATED
-----------------------------------
Signature of Registered Holder
Signature Guaranteed By: NOTE: The above signature must
correspond with the name as
written upon the face of this
Warrant Certificate in every
- -------------------------------- particular, without
alteration or enlargement or
any change whatever, unless
this Warrant has been
assigned.
A - 4
