MORGAN, LEWIS & BOCKIUS
PHILADELPHIA COUNSELORS AT LAW WASHINGTON
NEW YORK 101 PARK AVENUE LOS ANGELES
MIAMI NEW YORK, NEW YORK 10178 HARRISBURG
PRINCETON TELEPHONE: (212) 309-6000 LONDON
BRUSSELS FAX: (212) 309-6273 FRANKFURT
TOKYO
July 12, 1995
VIA EDGAR TRANSMISSION
Attention: File Support, EDGAR
Securities and Exchange Commission
Operations Center, Stop 0-7
6432 General Greenway
Alexandria, VA 22312
Re: National Patent Development Corporation
Amendment No. 2 to Schedule 13E-4, File No. 005-38329
_____________________________________________________
Ladies and Gentlemen:
On behalf of National Patent Development Corporation (the
"Company"), we have transmitted via EDGAR, pursuant to Rule 13e-4 under
the Securities Act of 1934, as amended (the "Act"), the Company's
Amendment No. 2 to Schedule 13E-4, with exhibits, in connection with the
completion of the Company's offer to exchange (the "Offer") (i) 8% Bonds
denominated in Swiss Francs and issued by the Company due June 28, 2000
(the "New Bonds"), in a principal amount of SFr. 650, and (ii) SFr. 600
in cash for each SFr. 1,000 in principal amount of 6% Convertible Bonds
Due March 7, 1995 (Swiss Security No. 887283), 5 3/4% Convertible Bonds
Due May 9, 1995 (Swiss Security No. 887284), 5 5/8% Convertible Bonds
Due March 18, 1996 (Swiss Security No. 887286) and 8% Bonds due March 1,
1995 (Swiss Security No. 887282), and (a) New Bonds in a principal
amount equivalent to US $650 and (b) Swiss Francs cash with a value
equivalent to US $600 for each US $1,000 in principal amount of 7% Dual
Currency Convertible Bonds Due March 18, 1996 (Swiss Security No.
887287).
Should you have any comments or questions as to the Offer,
please call either David Pollak at (212) 309-6058 or me at (212) 309-
6372.
Sincerely,
Renee E. Becnel
Enclosure
<PAGE>
<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
______________________
AMENDMENT NO. 2
TO
SCHEDULE 13E-4
______________________
ISSUER TENDER OFFER STATEMENT
(Pursuant to Section 13(e)(1) of the
Securities Exchange Act of 1934)
NATIONAL PATENT DEVELOPMENT CORPORATION
_______________________________________
(Name of Issuer)
NATIONAL PATENT DEVELOPMENT CORPORATION
_______________________________________
(Name of Person(s) Filing Statement)
6% Convertible Bonds Due March 7, 1995,
5 3/4% Convertible Bonds Due May 9, 1995,
5 5/8% Convertible Bonds Due March 18, 1996,
8% Bonds Due March 1, 1995, or
(collectively, the "Old Swiss Franc Bonds")
7% Dual Currency Convertible Bonds Due March 18, 1996
(the "Old U.S. Dollar Bonds," and collectively with
the Old Swiss Franc Bonds, the "Bonds")
_______________________________________
(Title of Class of Securities)
6% Convertible Bonds Due March 7, 1995,
(Swiss Security No. 887283)
5 3/4% Convertible Bonds Due May 9, 1995,
(Swiss Security No. 887284)
5 5/8% Convertible Bonds Due March 18, 1996,
(Swiss Security No. 887286)
8% Bonds Due March 1, 1995, or
(Swiss Security No. 887282)
7% Dual Currency Convertible Bonds Due March 18, 1996
(Swiss Security No. 887287)
_____________________________________________
(Cusip Number & Class of Securities)
Lawrence M. Gordon
National Patent Development Corporation
9 West 57th Street
New York, New York 10019
(212) 230-9500
_________________________________________________________________
(Name, Address and Telephone Number of Person Authorized to
Receive Notices and Communications on Behalf of the
Person(s) Filing Statement)
May 16, 1995
________________________________________
(Date Tender Offer First Published,
Sent or Given to Security Holders)<PAGE>
<PAGE>
Response to General Instruction D
_________________________________
As of June 14, 1995, the original Expiration Date of the
Offer, SFr. 3,774,000 aggregate principal amount of Old Swiss Franc
Bonds and US $1,104,000 aggregate principal amount of Old U.S. Dollar
Bonds were tendered for exchange pursuant to the Offer. National Patent
Development Corporation (the "Company") extended the Expiration Date of
the Offer from June 14, 1995 to June 28, 1995.
The Offer terminated at 5:00 p.m., New York City time, on
Wednesday, June 28, 1995. As of June 28, 1995, SFr. 4,154,000 aggregate
principal amount of Old Swiss Franc Bonds and US $1,206,000 aggregate
principal amount of Old U.S. Dollar Bonds were tendered for exchange
pursuant to the Offer and were accepted by the Company. Pursuant to the
terms of the Offer, the Company will issue SFr. 3,613,000 of its 8%
Bonds due June 28, 2000 and SFr. 3,335,000 in cash in exchange for the
tendered Old Bonds.
Response or Cross-Reference to
Item the Offering Circular
____ ________________________________
Item 9 Material to be filed as Exhibits.
______
(a) **(1) U.S. Offering Circular dated May 16, 1995.
**(2) Foreign Offering Circular dated May 16, 1995.
**(3) Form of U.S. Letter of Instructions.
**(4) Form of Acceptance.
**(5) Advertisement dated May 16, 1995 published in
The New York Times.
*(6) Notice, announcing the extension of the Offer,
published in The Wall Street Journal on June
19, 1995.
(7) Press Release of National Patent Development
Corporation dated July 6, 1995.
(b) None.
(c) ***(1) Draft of Indenture to be entered into between the
Company and Bank of Montreal Trust Company, as
Trustee, incorporated by reference to Exhibit T3C to
the Form T-3 filed by the company on May 11, 1995.
- 2 -<PAGE>
<PAGE>
(2) Exchange and Paying Agency Agreement dated as of May
16, 1995, among National Patent Development
Corporation, Banque Scandinave en Suisse and Bank
Leu Limited.
(d) None.
(e) None.
(f) None.
__________________________________________
* Previously filed on June 22, 1995.
** Previously filed on May 16, 1995.
*** Incorporated by reference to the filing indicated.
- 3 -
<PAGE>
<PAGE>
SIGNATURE
After due inquiry and to the best of my knowledge and belief,
I certify that the information set forth in this statement is true,
complete and correct.
July 12, 1995
________________________________________
(Date)
NATIONAL PATENT DEVELOPMENT CORPORATION
By Lawrence M. Gordon
_____________________________________
Name: Lawrence M. Gordon
Title: Vice President
- 4 -
<PAGE>
<PAGE>
EXHIBIT INDEX
Page Number in
sequentially
Numbered Volume
_______________
Exhibit (a)
**(1) U.S. Offering Circular dated May 16,
1995.
**(2) Foreign Offering Circular dated May
16, 1995.
**(3) Form of U.S. Letter of Instructions.
**(4) Form of Acceptance.
**(5) Advertisement dated May 16, 1995
published in The New York Times.
*(6) Notice, announcing the extension of
the Offer, published in The Wall
Street Journal on June 19, 1995.
(7) Press Release of National Patent
Development Corporation dated July 6,
1995.
(b)
***(1) Draft of Indenture to be entered into
between the Company and Bank of
Montreal Trust Company, as Trustee,
incorporated by reference to Exhibit
T3C to the Form T-3 filed by the
Company on May 11, 1995.
(2) Exchange and Paying Agency Agreement
dated as of May 16, 1995, among
National Patent Development
Corporation, Banque Scandinave en
Suisse and Bank Leu Limited.
__________________________________________
* Previously filed on June 22, 1995.
** Previously filed on May 16, 1995.
*** Incorporated by reference to the filing indicated.
- 5 -
<PAGE>
<PAGE>
Exhibit (a)(7)
N A T I O N A L P A T E N T D E V E L O P M E N T C O R P O R A T I O N
9 WEST 57 STREET NEW YORK, N.Y. 10019
(212) 826-8500 FAX: 230-9545
TELEX: 422550
Contact: Scott N. Greenberg Lawrence M. Gordon
Vice President and Vice President and
Chief Financial Officer General Counsel
(212) 230-9529 (212) 230-9513
NATIONAL PATENT SUCCESSFULLY COMPLETES EXCHANGE OFFER REDUCING SWISS
DEBT DUE IN 1995 TO APPROXIMATELY $848,000 AND SWISS DEBT DUE IN 1996 TO
APPROXIMATELY $1,370,000
FOR IMMEDIATE RELEASE:
New York, New York, July 6, 1995....National Patent Development
Corporation (NPD-ASE/PSE) announced today that it received an aggregate
of SFr. 4,154,000 principal amount of its Swiss denominated bonds due in
1995 and 1996 and an aggregate of $1,206,000 of its 7% Dual Currency
Bonds due in 1996 in response to its Exchange Offer which expired on
June 28, 1995. Under the terms of the Exchange Offer, National Patent
will issue SFr. 3,613,000 of its 8% Bonds due June 28, 2000 (the "New
Bonds"), and SFr. 3,335,000 in cash for the bonds tendered in the
Exchange Offer.
As of June 30, 1995, after the results of the exchange offer, there
are outstanding approximately $848,000 of bonds due in 1995, and an
aggregate of approximately $1,370,000 of bonds which are due in 1996.
<PAGE>
<PAGE>1
Exhibit (b)(2)
EXCHANGE AND PAYING AGENCY AGREEMENT
____________________________________
This Agreement is entered into as of May 16, 1995, among NA-
TIONAL PATENT DEVELOPMENT CORPORATION, a Delaware corpora-
tion with principal offices at 9 West 57th Street, New York,
New York 10019, United States of America (the "COMPANY"),
BANQUE SCANDINAVE EN SUISSE, a Swiss corporation with
principal offices at 11 Cours de Rive, 1204 Geneva,
Switzerland ("BANQUE SCANDINAVE") and BANK LEU LIMITED, a
Swiss corporation with principal offices at Bahnhofstrasse
20, 8001 Zurich, Switzerland ("BANK LEU", and together with
Banque Scandinave sometimes collectively referred to as the
"BANKS").
ARTICLE 1. THE OFFER
_________
The Company proposes to make an offer (the "OFFER") on the
Swiss capital market to exchange its outstanding 6% Conver-
tible Bonds Due March 7, 1995, 5-3/4% Convertible Bonds Due
May 9, 1995, 5-5/8% Convertible Bonds Due March 18, 1996, 8%
Bonds Due March 1, 1995 and 7% Dual Currency Convertible
Bonds Due March 18, 1996 (collectively, the "OLD BONDS")
against (a) 8% bonds due June/July 2000 denominated in Swiss
Francs (the "NEW BONDS") and (b) a cash amount in Swiss
Francs. In exchange for each SFr. 1,000.-- principal amount
and accrued interest thereon of the Old Bonds, the Company
will offer New Bonds with a principal amount of SFr. 650.--
and SFr. 600.-- in cash. In exchange for each USD 1,000.--
principal amount and accrued interest thereon of Old Bonds
denominated in US dollars, the Company will offer New Bonds
in a Swiss Franc principal amount equivalent to USD 650.--
and cash in Swiss Francs with a value of USD 600.--. The
Offer will be made on the terms and conditions set forth in
the offering circular dated May 1995 (the "OFFERING
CIRCULAR") and the form of acceptance, both attached hereto
as Annex A.
ARTICLE 2. APPOINTMENT OF EXCHANGE AGENT
_____________________________
The Company hereby appoints the Banks, and the Banks hereby
agree to act as exchange agents (the "EXCHANGE AGENTS") of
the Company in connection with the Offer. In their capacity
as Exchange Agents, the Banks will provide the following
services (Banque Scandinave acting with respect to the 8%
Bonds Due March 1, 1995 and the New Bonds and Bank Leu
acting with respect to all other Old Bonds):
(i) receive Old Bonds tendered in connection with
the Offer;
<PAGE>
<PAGE>2
(ii) notify the Company from time to time and upon
request of the total number of Old Bonds
tendered to such date;
(iii) notify the Company, no later than five business
days prior to the date (the "PAYMENT DATE") on
which the Old Bonds will be exchanged for the
New Bonds and cash, of the final number of Old
Bonds tendered;
(iv) receive and hold in custody the global bond
representing the New Bonds and distribute the
cash on the Payment Date;
(v) on behalf of the Company, account for and
cancel tendered Old Bonds; and
(vi) not earlier than 40 days after the Payment Date,
deliver the definitive forms of the New Bonds,
when available, to the deposit accounts
indicated by holders thereof.
ARTICLE 3. FORM AND TERMS OF THE NEW BONDS
_______________________________
(a) The terms and conditions of the New Bonds (the "TERMS OF THE
NEW BONDS") shall be as set forth on the reverse of the
form of the New Bonds attached hereto as Annex B.
(b) The Company shall deliver to Banque Scandinave the New Bonds
in the form of the global certificate, substantially in
the form attached hereto as Annex C, duly executed and
completed, no later than two business days prior to the
Payment Date. Banque Scandinave shall arrange on behalf
of the Company for the printing of the New Bonds and
shall hold the global certificate of such New Bonds
until the delivery of the definitive forms thereof. Upon
delivery of the definitive New Bonds, the global
certificate shall be promptly cancelled by Banque
Scandinave and returned to the Company.
ARTICLE 4. OFFERING CIRCULAR
_________________
(a) The Company has prepared, with the assistance of the Banks
in respect of the requirements of Swiss law, the
Offering Circular, describing the Company, the Offer and
the New Bonds in accordance with the requirements of
Swiss law. Any reference herein to the Offering Circular
shall be deemed to include any documents incorporated by
reference or otherwise therein.
<PAGE>
<PAGE>3
(b) The Company will, as soon as practicable, furnish to the
Banks, 5 copies of the Offering Circular signed by an
authorized officer of the Company, and with the
independent accountants' reports therein signed by such
accountants, and as many unsigned copies as the Banks
may reasonably request in connection with the Offer.
(c) The Banks have prepared a summary of the contents of the
Offering Circular (the "SUMMARY OFFERING CIRCULAR") in
the French and German languages and arranged for
publication thereof in accordance with the requirements
of Swiss law and the rules of the Swiss Stock Exchanges.
The Company will have no responsibility for errors or
omissions arising out of the preparation by the Banks of
such summaries and translations.
(d) The Banks will submit the Offer to the Commission for Reg-
ulation for confirmation as to its compliance with the
Swiss Code Governing Public Offers for Debt Securities
prior to any publication.
(e) The Banks shall not deliver any Offering Circular, Summary
Offering Circular or other materials concerning the
Offer to any person in the United States or to any
United States person (both as defined in Article 14
below).
ARTICLE 5. FEES
____
In consideration for the Banks' services hereunder, the Banks will
receive such fees and expense reimbursements as have been
separately agreed in writing.
ARTICLE 6. TAXES AND EXPENSES
__________________
The Company undertakes to pay:
(a) the Swiss federal securities transfer tax, if any.
(b) all fees and expenses of the Banks as they have separately
been agreed.
ARTICLE 7. REPRESENTATIONS, WARRANTIES, AND INDEMNIFICATIONS
_________________________________________________
(a) The Company represents and warrants that:
<PAGE>
<PAGE>4
(i) The Company is a duly organized corporation in good
standing under the laws of the jurisdiction of
its incorporation and is duly qualified to own
its properties and assets and to transact the
business and conduct the operations in which it
engages.
(ii) The execution and delivery of this Agreement has
been duly authorized by the Company, and the
performance of this Agreement and the
consummation of the Offer and the transactions
contemplated hereby, in particular the issue of
the New Bonds, will not conflict with, result in
a breach of, or constitute a default under the
certificate of incorporation or by-laws of the
Company or any agreement or instrument to which
it is a party or by which it is bound, or any
order or regulation applicable to the Company of
any court or governmental authority or any
arbitrator having jurisdiction over the Company.
(iii) The Offering Circular is accurate in all material
respects and does not contain any untrue
statement of a material fact or omit to state
any material fact necessary to make the
statements contained therein, in light of the
circumstances under which they were made, not
misleading.
(iv) The consolidated financial statements of the Company
and its subsidiaries included in the Offering
Circular fairly present the consolidated
financial position of the Company as of the
dates referred to therein and results of the
operations and changes in financial position for
the periods therein specified, in accordance
with generally accepted accounting principles in
the United States of America applied on a
consistent basis except as stated in the report
of the independent auditors.
(v) Except as set forth or contemplated in the Offering
Circular, there has been no material adverse
change in the operations, business, properties
or assets of, or in the condition (financial or
otherwise) of, the Company and its subsidiaries
since December 31, 1994.
(vi) Except as set forth or contemplated in the Offering
Circular, there are no actions, suits or pro-
ceedings pending or, to the best of the
<PAGE>
<PAGE>5
Company's knowledge, threatened against or
affecting the Company or its subsidiaries before
any court, agency or arbitrator which might
result in a judgment or decree having a material
adverse effect on the business, operations,
financial condition or income of the Company and
its subsidiaries taken as a whole.
(vii) This Agreement is, and the global certificate of the
New Bonds and the New Bonds, when duly executed
and delivered as provided herein will be legal,
valid and binding obligations of the Company en-
forceable against the Company in accordance with
their respective terms, except as such enforce-
ability may be limited by equitable principles
or by applicable bankruptcy, insolvency,
moratorium and similar laws affecting creditors'
rights generally.
(viii) All consents and approvals of any court, govern-
mental department or other regulatory body re-
quired for the execution and delivery by the
Company of this Agreement and the issuance and
sale by the Company of the New Bonds as
contemplated herein and in the Offering Circular
and the performance by the Company of the Terms
of the New Bonds and this Agreement have been
obtained and are in full force and effect or
will be obtained by the Payment Date.
(b) The Company will indemnify and hold harmless each
Bank against any losses, liabilities, costs, claims,
expenses, actions or demands which they may incur or
which may be made against them, other then those based
upon or arising out of the gross negligence or willful
misconduct of such Bank, related to or arising out of
activities performed or services furnished as Exchange
Agent or as a result of any material breach of any of
the foregoing representations and warranties of the
Company. Promptly after receipt by any Bank under this
Article of notice of any claim or the commencement of
any action, such Bank will, if a claim in respect
thereof is to be made against the Company hereunder, no-
tify the Company in writing thereof; but the failure so
to notify the Company will not relieve the Company from
any liability which it may otherwise have to the Bank.
If it so elects within a reasonable time after receipt
of such notice, the Company may assume the defense of
any such action with counsel chosen by it and approved
by the indemnified Bank in such action, unless such Bank
reasonably objects on the ground that there may be legal
<PAGE>
<PAGE>6
defenses available to it which are different from those
available to the Company. If the Company assumes the de-
fense of such action, it shall not be liable for any
fees and expenses of counsel for the Banks incurred
thereafter in connection with such action. In no event
shall the Company be liable for the fees and expenses of
more than one counsel for all Banks in connection with
any one action or separate but similar or related
actions in the same jurisdiction arising out of the same
general allegations or circumstances.
ARTICLE 8. CONDITIONS TO THE OBLIGATIONS OF THE BANKS
__________________________________________
The obligations of the Banks hereunder shall be subject to the
accuracy in all material respects of the representations and
warranties of the Company contained herein as of the date
hereof and as of the Payment Date (as if made at and as of
the Payment Date), to the performance by the Company of its
obligations hereunder, and to the condition that the Banks
have received, on or before the Payment Date the following
documents, in form and substance satisfactory to them:
(a) certified articles of incorporation and by-laws of
the Company and of the resolutions fo the Board of
Directors of the Company approving this Agreement and
the transactions contemplated hereby; and evidence of
the authority and incumbency of the persons executing
this Agreement, the Offering Circular and the New Bonds
on behalf of the Company;
(b) a certificate of the Company signed by the principal
financial or accounting officer of the Company, dated as
of the Payment Date, to the effect that:
(i) the representations and warranties of
the Company contained in this Agreement are true
and correct in all material respects at the
Payment Date with the same effect as if made at
and as of the Payment Date, and the Company has
performed in all material respects all the
obligations and satisfied all the conditions on
its part to be performed or satisfied at or
prior to the Payment Date; and
(ii) since the date of the most recent audited
financial statements included in the Offering
Circular there has been no material adverse
change in the condition (financial or other),
earnings, business or properties of the Company
and its subsidiaries, taken as a whole, whether
<PAGE>
<PAGE>7
or not arising from transactions in the ordinary
course of business, except as set forth or
contemplated in the Offering Circular.
(c) certificates of good standing of the Company of a
recent date.
ARTICLE 9. NO STOCK EXCHANGE LISTING
_________________________
The Company will not apply for the listing of the New Bonds on
any stock exchange in Switzerland or elsewhere.
ARTICLE 10. PAYMENTS AND PAYING AGENT
_________________________
(a) The Company hereby appoints Banque Scandinave as its
sole paying agent (the "PAYING AGENT") for the New Bonds
and undertakes to transfer or cause to be transferred to
the Paying Agent, not later than two business days in
Geneva prior to each date on which a payment falls due
(a "DUE DATE"), the funds or, if payment is to be made
in shares of common stock of the Company, stock
certificates representing the shares required for
payments on the New Bonds in accordance with Section 5
of the Terms of the New Bonds and for the paying agency
commissions set forth in this Article. Such payments
shall be made in freely disposable legal currency of the
Swiss Confederation, without any limitations and under
all circumstances, irrespective of the nationality,
residence or domicile of any of the holders of the New
Bonds ("NEW BONDHOLDERS"), and without requiring any
affidavit or the fulfilment of any formalities or, if
payment is to be made in shares of common stock of the
company, by delivery of stock certificates representing
shares of common stock of the Company. All foreign ex-
change costs and expenses incurred by the Paying Agent
and the Company in making available the funds required
for payments on the New Bonds shall be borne by the
Company.
(b) The Paying Agent shall credit such funds to a
separate non-interest-bearing account to be opened with
the Paying Agent in the name of the Company for the
interest and principal payments on each due date. All
such funds shall be held in such account until the
expiration of the period referred to in Section 10 of
the Terms of the New Bonds, at which time such funds
shall be repaid to the Company.
<PAGE>
<PAGE>8
(c) The Paying Agent shall be entitled to a trustee fee
of SFr. 20,000.-- per annum, payable in advance on each
annual interest payment date of the New Bonds, for the
first time on the date of issuance (June/July 1995). In
addition, on each due date the Company agrees to pay to
the Paying Agent a commission of 0.25% of the amount of
the coupons paid, and of 0.125% of the principal amount
of the New Bonds redeemed. All such fees and commissions
are payable in cash in Swiss Francs.
(d) So long as the Paying Agent shall satisfactorily
perform its duties, the Company will not, without the
Paying Agent's consent, appoint any other banks as
paying agents or pay other banks any commission or
remuneration for the collection of coupons or New Bonds.
(e) The Paying Agent shall cancel and destroy all paid
coupons and New Bonds. The Paying Agent shall furnish
the Company with a record of such destruction including
the number of coupons and serial numbers of New Bonds
destroyed. The Paying Agent shall have the right to
record cashed coupons and redeemed New Bonds on micro
film or other data systems, instead of storing them
during the statutory period.
(f) The Paying Agent shall promptly publish all notices
of default received from the Company pursuant to the
Terms of the Bonds, provided, however, that the Paying
Agent shall not be required to take any further action
in the event of such default and shall assume no
obligation and shall be subject to no obligation, and
shall be subject to no liability under this Agreement to
any New Bondholder or any other person.
(g) The Company shall indemnify the Paying Agent against
any loss, liability, cost, claim, expense, action or
demand incurred or made against it, other than those
based upon or arising out of the gross negligence or
willful misconduct of the Paying Agent or any of its
employees or agents, in connection with its acting, or
exercising or refraining from exercising any of the
rights and obligations conferred upon it, as Paying
Agent under the terms of this Agreement.
(h) For purposes of this Article 10, the Paying Agent
shall exclusively act through its offices in Switzerland
and otherwise shall act only in compliance with Section
5 of the Terms of the New Bonds.
<PAGE>
<PAGE>9
ARTICLE 11. NOTICES AND REPORTS TO NEW BONDHOLDERS
______________________________________
(a) The Company will arrange through the Paying Agent
for the publication of all notices to New Bondholders,
at the expense of the Company, in the Swiss Official
Commercial Gazette and in a daily newspaper in Zurich,
Basle and Geneva.
(b) So long as any of the New Bonds are outstanding, the
Company will furnish the Paying Agent, to be held at the
disposal of the New Bondholders, with 50 copies of each
report on Form 10-K, Form 10-Q and Form 8-K, promptly
after such report is filed by the Company with the U.S.
Securities and Exchange Commission, and of any financial
statements or other reports that the Company may from
time to time furnish generally to its shareholders or
holders of its debt securities.
ARTICLE 12. TERMINATION
___________
The Banks shall have the right to terminate this Agreement
prior to the Payment Date if:
(a) there shall have been, subsequent to the dates as of
which information is given in the Offering Circular, any
material adverse change in, of affecting the business or
properties of the Company and its subsidiaries taken as
a whole, or if events should hereafter occur in the
United States, in Switzerland or elsewhere in the world
of a political, economic or monetary character, the
effect of any which, in the reasonable opinion of the
Banks, would be such as materially to jeopardize the
success of the Offer;
(b) the Company fails in any material respect to perform
any of its obligations under this Agreement;
(c) any of the representations and warranties made by
the Company in this Agreement shall prove to have been
incorrect in any material respect when made; or
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<PAGE>10
(d) there shall occur any event described in Section
15 of "The Offer" of the Offering Circular which the
Banks reasonably believe may result in any liability to
them or may involve them in any action, proceeding or
application of the type described in such Section 15.
Any such termination shall be in the absolute discretion of each of the
Banks and shall be effective upon notice to the Company by
such Bank. Upon such termination the parties hereto shall be
relieved of their rights and obligations hereunder, except
that the Company shall pay the costs and expenses incurred
by the Banks prior to such termination in connection with
the proposed Offer, unless such termination is based upon
point (a) above, and that the provisions of Articles 6, 7,
13, 14, 15, and 16 shall survive termination of this
Agreement.
ARTICLE 13. CURRENCY OF PAYMENT
___________________
The obligations of the Company in respect of any amount stated to be
due in Swiss Francs under the New Bonds or this Agreement
shall, notwithstanding any payment in any other currency
(whether pursuant to a judgment or otherwise), be discharged
only to the extent of the amount in Swiss Francs that the
party entitled to receive such payment may, in accordance
with normal banking procedures, purchase with the sum paid
in such other currency (after any premium and costs of
exchange) on the banking day immediately following the day
on which such party receives such payment. If the amount in
Swiss Francs that may be so purchased for any reason falls
short of the amount originally due, the Company shall pay
such additional amounts as may be necessary to compensate
for such shortfall. Any obligation of the Company not
discharged by such payment shall be due as a separate and
independent obligation and, until discharged as provided
herein, shall continue in full force and effect.
<PAGE>
<PAGE>11
ARTICLE 14. SELLING RESTRICTIONS
____________________
(a) The New Bonds have not been and will not be registered under the
United States Securities Act of 1933 (the "SECURITIES
ACT") and may not be offered, sold or delivered,
directly or indirectly, in the United States or to, or
for the account of, any U.S. Person. Offers and sales of
New Bonds in the United States or to U.S. Persons would
constitute a violation of United States law unless made
in compliance with the registration requirements of the
Securities Act or pursuant to an exemption therefrom.
(b) As to the Company, the New Bonds are intended to be obligations
that are not required to be in registered form for pur-
poses of United States federal tax laws. Accordingly,
the New Bonds may not, as part of the Offer or otherwise
as part of the initial distribution, be offered for sale
or resale, sold or delivered, directly or indirectly, to
a person in the United States or to a United States
person. Consistent with these limitations, the Offer
does not apply to, is not made to and may not be ac-
cepted by holders of Old Bonds that are within the
United States or that are United States persons. In
order to tender Old Bonds validly pursuant to the Offer,
a Form of Acceptance in the form of Annex A hereto must
be submitted by or on behalf of a holder of Old Bonds
(i) certifying that the Old Bonds being tendered are not
held by or on behalf of a person within the United
States or a United States person, (ii) representing and
agreeing that (a) such holder has not offered or sold,
and, during the period beginning on the earlier of the
first date that the New Bonds are offered or the Payment
Date and ending on the date forty (40) days after the
Payment Date (the "Restricted Period"), such holder will
not offer or sell, New Bonds to a person who is within
the United States or to a United States person, (b) such
holder has not delivered and will not deliver within the
United States definitive New Bonds that are sold during
the Restricted Period, (c) in the case of a holder that
offers or sells New Bonds during the Restricted Period,
such holder has and throughout the Restricted Period
will have in effect procedures reasonably designed to
ensure that its employees or agents who are directly
engaged in selling New Bonds are aware that such New
Bonds may not be offered or sold during the Restricted
Period to a person who is within the United States or to
a United States person and (d) such holder has not
entered and will not enter into any contractual
arrangement with respect to the distribution and de-
livery of the New Bonds, except with its affiliates or
with the prior written consent of the Company and (iii)
<PAGE>
<PAGE>12
with respect to each affiliate that acquires from it New
Bonds for the purpose of offering or selling such New
Bonds during the Restricted Period, repeating and
confirming the representations and agreements contained
in clauses (ii) (a), (b) and (c) on each such
affiliate's behalf. For purposes of this Agreement,
whether an offer, sale or delivery is made to a person
within the United States or to a United States person
will be determined under the rules set out in the United
States Internal Revenue Code of 1986 (the "Code") and
United States Treasury Regulation Section 1.163-5(c) (2)
(i) (D). The Banks agree that they will comply fully
with the selling restrictions set out in this Section
14(b) and, in particular, the Banks hereby covenant and
agree to the effect set out in clauses (ii) and (iii) of
the second preceding sentence.
(c) The New Bonds will be represented initially by a temporary Global
New Bond (the "Global New Bond"), without interest
coupons, to be deposited by the Company with Banque
Scandinave en Suisse, on behalf of the Banks, on the
Payment Date. The Global New Bond may be exchanged, as a
whole or in part, for appropriate definitive New Bonds,
in bearer form in the denominations of SFr. 10, SFr. 100
and SFr. 1,000 with interest coupons (the "coupons")
attached, not earlier than 40 days after the later of
the date on which the New Bonds are first offered or the
Payment Date, before which time no New Bonds represented
by the Global New Bond or interest therein may be
transferred to a person who is within the United States
or to a United States person or a U.S. person. Such
exchange shall be made upon certification, in the form
attached hereto as Annex D, that the beneficial owners
of the New Bonds are not United States persons or U.S.
persons or are financial institutions (within the
meaning of United States Treasury Regulation Section
1.165-12(c)(1)(v)) located outside the United States
that are not United States persons and that have
purchased such New Bonds for resale during the Re-
stricted Period and that certify they have not acquired
the New Bonds for purposes of resale directly or indi-
rectly to a person who is within the United States or to
a United States person or a U.S. person. A beneficial
owner of New Bonds must exchange its share of the Global
New Bond for definitive New Bonds before such New Bonds
or interests therein may be transferred or interest
payments or other payments in respect of the New Bonds
will be made.
(d) Tenders of Old Bonds pursuant to the Offer may be made only to the
specified offices of the Banks outside the United
<PAGE>
<PAGE>13
States. The Company will deliver the New Bonds and cash
to the Banks outside the United States, and the Banks
will deliver on behalf of the Company, the New Bonds and
cash pursuant to the Offer only to an account or address
outside the United States.
(e) In this Agreement, references to "dollars", "$" and "US $" are to
United States dollars, the term "United States" means
the United States of America (including the States and
the District of Columbia), its territories, its pos-
sessions and other areas subject to its jurisdiction,
and the term "United States person" means a citizen or
resident of the United States, a corporation,
partnership or other entity created or organized in or
under the laws of the United States or any political
subdivision thereof, or an estate or trust the income of
which is subject to United States federal income
taxation regardless of its source. "U.S. person" shall
have the meaning set forth in Sections 230.901 through
904 of Title 17 of the United States Code of Federal
Regulations ("Regulation S").
(f) The following legend will appear on all New Bonds and coupons
issued pursuant to the Offer: "Any United States person
who holds this obligation will be subject to limitations
under the United States income tax laws, including the
limitations provided in sections 165(j) and 1287(a) of
the Internal Revenue Code". The sections referred to in
the legend provide that, with certain exceptions, a
United States person will not be permitted to deduct any
loss, and will not be entitled to capital gain treatment
with respect to any gain, realized on a sale, exchange
or redemption of such New Bonds or coupons.
(g) The Company represents. warrants and covenants that the New Bonds
have not been and shall not be offered or sold except in
accordance with Rule 903 promulgated under the Securi-
ties Act or in a transaction exempt from the regis-
tration requirements of the Securities Act. Each of the
Company and the Banks represents, warrants and covenants
that (i) none of it, its affiliates or any person acting
on its behalf has engaged or will engage in any directed
selling efforts (as defined in Rule 902 promulgated
under the Securities Act) in the United States and it
has complied and will comply with the offering restric-
tions of Regulation S under the Securities Act in
connection with the Offer, (ii) none of it, its
affiliates or any person acting on its behalf has
utilized or will utilize any form of general solicita-
tion or general advertising (as such terms are used in
Regulation D promulgated under the Securities Act) in
<PAGE>
<PAGE>14
connection with the Offer or the offer or the sale of
the New Bonds in the United States, (iii) none of it,
its affiliates or any person acting on its behalf has
made or will make the Offer in circumstances that would
require the registration of the New Bonds under the
Securities Act and (iv) tenders of Old Bonds pursuant to
the Offer shall be accepted only from, and New Bonds
shall be exchanged pursuant to the Offer only for,
persons who are not within the United States.
ARTICLE 15. NOTICES
_______
All notices under this Agreement shall be deemed to have been duly
given if sent by cable, telex or facsimile transmission
(confirmed in writing, sent by registered airmail) to the
following addresses:
If to the Company:
NATIONAL PATENT DEVELOPMENT CORPORATION
9 West 57th Street
New York, New York 10019, U.S.A.
Attention: General Counsel
Telex: 422550
Telefax: (212) 230 9545
If to the Banks, the Exchange Agents or the Paying Agent:
BANQUE SCANDINAVE EN SUISSE
Attention: Mr. Jean-Claude Birchler
11 Cours de Rive
1204 Geneva, Switzerland
Telex: 413500
Telefax: (022) 787 34 49
BANK LEU LIMITED
Financial Engineering
Post Office Box
8022 Zurich, Switzerland
Telefax: (01) 809 75 39
or to such other address as the party receiving the notice shall have
notified to the other party in writing. Such cable, telex or
facsimile transmission notice shall be deemed to have been
duly given at the time of dispatch. Any party receiving a
notice by cable, telex or facsimile transmission will be
protected by relying upon the cabled, telexed or transmitted
notice even though such notice is not subsequently confirmed
in writing.<PAGE>
<PAGE>15
ARTICLE 16. GOVERNING LAW; JURISDICTION
___________________________
This Agreement shall be governed by and construed in accordance with
Swiss law. Any action or proceedings against the Company
relating to this Agreement may be brought and enforced in
the ordinary courts of the Canton of Geneva, venue being in
the city of Geneva, and the Company hereby irrevocably
submits to such courts in respect of any such action or
proceeding with the right to appeal, to the extent provided
by law, to the Swiss Federal Court in Lausanne, the judgment
of which shall be final. Solely in connection with matters
relating to this Agreement and for the purpose of its
enforcement in Switzerland, the Company hereby elects legal
and special domicile at the office of Lenz & Staehelin,
Grand'Rue 25, 1211 Geneva 11, Switzerland. The Company
covenants that so long as any New Bond is outstanding, it
will maintain an agent for service of process in
Switzerland.
The Banks shall also have the right to bring any legal action or
proceeding against the Company in any state or federal court
in the United States of America which may have jurisdiction.
<PAGE>
<PAGE>16
ARTICLE 17. COUNTERPARTS
____________
This Agreement may be executed in any number of counterparts, each of
which shall be an original; but such counterparts shall
together constitute but one and the same instrument.
IN WITNESS WHEREOF, the Company and the Banks have signed this
Agreement as of the date first above written.
NATIONAL PATENT DEVELOPMENT CORPORATION
By:____________________________________
Name:
Title:
BANQUE SCANDINAVE EN SUISSE
By:___________________________________
Name:
Title:
BANK LEU LIMITED
By:___________________________________
Name:
Title:
