<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_______________
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): October 11, 1999
_______________
ICF INTERNATIONAL, INC.
(Exact name of registrant as specified in its charter)
Delaware File No. 1-12248 54-1437073
(State or other (Commission File (IRS Employer
jurisdiction of Number) Identification No.)
incorporation)
9300 Lee Highway
Fairfax, Virginia 22031-1207
(Address of principal executive offices, including zip code)
703-934-3600
(Registrant's telephone number, including area code)
<PAGE>
Item 5. Other Events
------ ------------
On September 15, 1999, ICF Kaiser International, Inc. amended its Rights
Agreement dated January 13, 1992 that governs its Shareholder Rights Plan. The
amendment is attached as Exhibit 4(k).
On October 6, 1999, ICF Kaiser International, Inc. (the "Company")
purchased $14,000,000 of outstanding notes from holders of its $15,000,000 12%
Senior Notes due 2003, Series B (the "Notes"). The Notes were issued pursuant
to an indenture, dated as of December 23, 1996 (as supplemented and amended, the
"Indenture"), between the Company and The Bank of New York, as trustee (the
"Trustee"). The Company purchased the Notes at 88% of par value plus accrued
interest from June 30, 1999. Pursuant to an agreement between the Noteholders
and the Company, the form of which is attached as Exhibit 10(tt), the holders of
the purchased Notes consented to amending the Indenture through a Fifth
Supplemental Indenture. The Fifth Supplemental Indenture removes substantially
all of the financial and other restrictive covenants and most events of default
contained in the Indenture and is attached as Exhibit 4(d)(5).
Item 7. Financial Statements and Exhibits.
(c) Exhibits.
--------
4(d)(5) Fifth Supplemental Indenture, dated as of October 5, 1999.
4(k) Amendment No. 2 to Rights Agreement
10(tt) Form of Agreement of Release, Consent and Waiver, dated October 5,
1999, between the Company and T. Rowe Price, Penn Series High Yield
Bond Fund, NorthStar Investment Management, and Deutsche Bank.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this Report on Form 8-K to be signed on its behalf by
the undersigned hereunto duly authorized.
ICF KAISER INTERNATIONAL, INC.
(Registrant)
/s/ Timothy P. O'Connor
----------------------------------
Timothy P. O'Connor
Executive Vice President,
Chief Financial Officer and
Chief Administrative Officer
Date: October 11, 1999
<PAGE>
Exhibit 4(d)(5)
================================================================================
ICF KAISER INTERNATIONAL, INC., Issuer
and
CYGNA CONSULTING ENGINEERS AND PROJECT MANAGEMENT, INC., Guarantor
KAISER GOVERNMENT PROGRAMS, INC., Guarantor
EDA, INCORPORATED, Guarantor
GLOBAL TRADE & INVESTMENT, INC., Guarantor
KAISER EUROPE, INC., Guarantor
ICF KAISER / GEORGIA WILSON, INC., Guarantor
ICF KAISER OVERSEAS ENGINEERING, INC., Guarantor
ICF KAISER ENGINEERS PACIFIC, INC., Guarantor
ICF KAISER ADVANCED TECHNOLOGY, INC., Guarantor
to
THE BANK OF NEW YORK, Trustee
_______________
Fifth Supplemental Indenture
Dated as of October 5, 1999
to
Indenture dated as of December 23, 1996
_______________
$15,000,000 12% Senior Notes due 2003, Series A and 12% Senior Notes due 2003,
Series B
================================================================================
<PAGE>
This FIFTH SUPPLEMENTAL INDENTURE, dated as of October 5, 1999, is entered
into by and among ICF Kaiser International, Inc., a Delaware corporation (the
"Company"), The Bank of New York, a New York banking corporation (the
"Trustee"), and each of the following guarantors: Cygna Consulting Engineers and
Project Management, Inc., a Delaware corporation; Kaiser Government Programs,
Inc., a Delaware corporation formerly named ICF Kaiser Government Programs,
Inc.; EDA, Incorporated, a Maryland corporation; Global Trade & Investment,
Inc., a Delaware corporation; Kaiser Europe, Inc., a Delaware corporation
formerly named ICF Kaiser Europe, Inc.; ICF Kaiser / Georgia Wilson, Inc., a
Delaware corporation; ICF Kaiser Overseas Engineering, Inc., a Delaware
corporation; ICF Kaiser Engineers Pacific, Inc., a Delaware corporation; and ICF
Kaiser Advanced Technology, Inc., an Idaho corporation (collectively, the
"Guarantors").
WITNESSETH:
WHEREAS, the Company and the Trustee are parties to an Indenture dated
as of December 23, 1996 (the "Indenture"), relating to the Company's $15,000,000
12% Senior Notes due 2003, Series A and 12% Senior Notes due 2003, Series B
(collectively, the "Notes");
WHEREAS, the Company desires to purchase all of the outstanding Notes
for cash, in an aggregate amount not to exceed $13,200,000, plus accrued
interest from June 30, 1999, and, in connection therewith, obtain consents to
the adoption of amendments to the Indenture, as further described herein;
WHEREAS, Section 10.02 of the Indenture provides that the Company and
the Trustee may amend the Indenture or the Notes with the written consent
(including consents obtained in connection with a tender offer or exchange offer
for Notes) of the Holders of at least a majority in principal amount of the then
outstanding Notes (the "Requisite Holders");
WHEREAS, Section 10.02 of the Indenture further provides that the
Company, when authorized by a resolution of its Board of Directors, and the
Trustee may amend or supplement the Indenture and the Notes with the written
consent of the Requisite Holders;
WHEREAS, the Company has obtained the written consents of the
Requisite Holders to the amendments set forth below and written waivers from
such consenting Holders to the application of certain covenants and other
provisions contained in the Indenture;
WHEREAS, in accordance with Section 10.02 of the Indenture, the Board
of Directors of the Company has authorized the execution and delivery of this
Fifth Supplemental Indenture and the Company has filed with the Trustee evidence
of the consent of the Holders; and
WHEREAS, the Company, the Guarantors, and the Trustee desire to enter
into, execute and deliver this Fifth Supplemental Indenture in compliance with
the provisions of the Indenture;
1
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NOW, THEREFORE, in consideration of the premises and of the acceptance
by the Trustee of the trusts created hereby and by the Indenture, and also for
and in consideration of the sum of One Dollar to the Company duly paid by the
Trustee at or before the execution and delivery of this Supplemental Indenture,
the receipt of which is hereby acknowledged, it is hereby covenanted and agreed,
by and among the Company, the Guarantors, and the Trustee, as follows:
ARTICLE 1
AMENDMENTS TO INDENTURE
Section 1.01 Amendment of Article 5. Effective on the date hereof,
----------------------
Article 5 is hereby amended by:
(a) deleting Sections 5.04 ("Limitations on Additional
Indebtedness"), 5.05 ("Limitations on Subsidiary Debt and Preferred Stock"),
5.06 ("Limitations on Restricted Payments"), 5.07 ("Limitations on Restrictions
on Distributions from Subsidiaries"), 5.08 ("Limitations on Transactions With
Affiliates"), 5.10 ("Restrictions on Sale of Stock of Subsidiaries"), 5.11
("Limitations on Guarantees"), 5.13 ("Corporate Existence"), 5.14 ("Stay,
Extension and Usury Laws"), 5.15 ("Insurance; Books and Records; Compliance with
Law"), and 5.16 ("Inspection and Confidentiality"), in their entirety without
substitution therefor;
(b) renumbering Section 5.09 ("Limitations on Asset Sales") to be
Section 5.04, Section 5.12 ("SEC Reports") to be Section 5.05, and Section 5.17
("Compliance Certificates") to be Section 5.06;
(c) inserting in paragraph (b) of Section 5.04 (as renumbered in
accordance with Section 1.01(b) above) the words "Section 5.04 of" between the
word "and" and the words "this Indenture (an 'Asset Sale Offer')";
(d) deleting the references to Section 5.09 in the four places where
they appear in paragraph (c) of Section 5.04 (as renumbered) and inserting in
lieu thereof references to Section 5.04;
(e) inserting a new paragraph (d) at the end of Section 5.04 to read
as follows:
"(d) Notwithstanding any provision contained in this
Indenture, the purchase of the Notes and consents to the
amendments set forth in the Fifth Supplemental Indenture to the
Indenture, shall be expressly permitted under this Indenture and
shall not be deemed to constitute a breach, violation or other
contravention of any provision contained in this Indenture."
(f) deleting the text of Section 5.05 (as renumbered) in its entirety
and inserting in lieu thereof the following text:
"The Company shall comply with the provisions of TIA section
314(a).";
2
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(g) deleting the reference to Section 5.12 in paragraph (b) of
Section 5.06 (as renumbered in accordance with Section 1.01(b) above) and
inserting in lieu thereof a reference to Section 5.05; and
(h) in accordance with the deletion of Section 5.11 pursuant to
paragraph (a) above,
(i) releasing the Guarantors, without further action of, or
execution and delivery of any further documents or instruments by the
Company, the Guarantors or the Trustee, from the Guarantees to which each
such Guarantor is (as applicable) party; and
(ii) deleting from the defined terms "Guarantee" and "Guarantor"
the text following the words "shall mean" and inserting in lieu thereof the
text "[intentionally deleted]".
Section 1.02 Amendment of Article 6. Effective on the date hereof,
----------------------
Article 6 is hereby amended by:
(a) deleting Section 6.01 and renumbering Section 6.02 to be Section
6.01; and
(b) deleting the phrase "in accordance with Section 6.01" in Section
6.01(a) (as renumbered in accordance with the immediately preceding Section
1.02(a) above).
Section 1.03 Amendment of Article 7. Effective on the date hereof,
----------------------
Article 7 is hereby amended by deleting the text of clause numbers (3) through
(8), inclusive, of Section 7.01 and inserting in lieu thereof for each such
deleted clause the following text: "[Intentionally deleted]".
ARTICLE 2
MISCELLANEOUS
Section 2.01 Effect of Supplemental Indenture. On the date hereof,
--------------------------------
the Indenture shall be supplemented in accordance herewith, and this Fifth
Supplemental Indenture shall form a part of the Indenture for all purposes, and
every Holder of Notes heretofore or hereafter authenticated and delivered under
the Indenture shall be bound thereby.
Section 2.02 Indenture Remains in Full Force and Effect. Except as
------------------------------------------
supplemented hereby and by the First through Fourth Supplemental Indentures, all
provisions in the Indenture shall remain in full force and effect.
Section 2.03 Indenture and Supplemental Indentures Construed
-----------------------------------------------
Together. All provisions of this Fifth Supplemental Indenture shall be deemed
to be incorporated in, and made a
3
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part of, the Indenture; and the Indenture, as supplemented and amended by this
Fifth Supplemental Indenture, shall be read, taken and construed as one and the
same instrument.
Section 2.04 Confirmation and Preservation of Indenture. The
------------------------------------------
Indenture, as supplemented and amended by the First through Fifth Supplemental
Indentures, is in all respects confirmed and preserved.
Section 2.05 Conflict with Trust Indenture Act. If any provision of
---------------------------------
this Fifth Supplemental Indenture limits, qualifies, or conflicts with any
provision of the Trust Indenture Act that is required under such Act to be part
of and govern any provision of this Fifth Supplemental Indenture, the provision
of such Act shall control. If any provision of this Fifth Supplemental
Indenture modifies or excludes any provision of the Trust Indenture Act that may
be so modified or excluded, the provisions of such Act shall be deemed to apply
to the Indenture as so modified or to be excluded by this Fifth Supplemental
Indenture, as the case may be.
Section 2.06 Separability Clause. In case any provision in this
-------------------
Fifth Supplemental Indenture shall be invalid, illegal, or unenforceable, the
validity, legality and enforceability of the remaining provisions shall not in
any way be affected or impaired thereby.
Section 2.07 Terms Defined in the Indenture. All capitalized terms
------------------------------
not otherwise defined herein (including capitalized terms used in the Recitals
hereto) shall have the meanings ascribed to them in the Indenture.
Section 2.08 Effect of Headings. The Article and Section headings in
------------------
this Fifth Supplemental Indenture are for convenience only and shall not affect
the construction hereof.
Section 2.09 Benefits of Fifth Supplemental Indenture. Nothing in
----------------------------------------
this Fifth Supplemental Indenture, the Indenture, or the Notes, express or
implied, shall give to any Person, other than the parties hereto and thereto and
their successors hereunder and thereunder and the Holders, any benefit of any
legal or equitable right, remedy, or claim under the Indenture, the First
through Fifth Supplemental Indentures, or the Notes.
Section 2.10 Successors and Assigns. All covenants and agreements in
----------------------
this Fifth Supplemental Indenture by the Company and the Guarantors shall bind
their successors and assigns, whether so expressed or not.
Section 2.11 Trustee Not Responsible for Recitals. The recitals
------------------------------------
contained herein shall be taken as the statements of the Company and the
Guarantors, and the Trustee assumes no responsibility for their correctness.
Section 2.12 Certain Duties and Responsibilities of the Trustee. In
--------------------------------------------------
entering into this Fifth Supplemental Indenture, the Trustee shall be entitled
to the benefit of every provision of the Indenture relating to the conduct or
affecting the liability of or affording protection to the Trustee, whether or
not elsewhere herein so provided.
4
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Section 2.13 GOVERNING LAW. THIS FIFTH SUPPLEMENTAL INDENTURE SHALL
-------------
BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW
YORK, WITHOUT REGARD TO THE CONFLICTS OF LAW PRINCIPLES THEREOF.
Section 2.14 Counterparts. This Fifth Supplemental Indenture may be
------------
executed in any number of counterparts, each of which, when so executed, shall
be deemed to be an original, but all such counterparts shall together constitute
but one and the same instrument.
[Remainder of page intentionally blank.]
5
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Fifth
Supplemental Indenture to be duly executed, all as of the day and year first
above written.
ICF KAISER INTERNATIONAL, INC.
By: /s/ Timothy P. O'Connor
--------------------------------------
Name: Timothy P. O'Connor
Title: Executive Vice President and
Chief Financial Officer
THE BANK OF NEW YORK, as Trustee
By: /s/ Mary Lewicki
--------------------------------------
Name: Mary Lewicki
Title: Assistant Vice President
CYGNA CONSULTING ENGINEERS AND
PROJECT MANAGEMENT, INC.
By: /s/ Timothy P. O'Connor
--------------------------------------
Name: Timothy P. O'Connor
Title: Treasurer
KAISER GOVERNMENT PROGRAMS, INC.
(formerly ICF Kaiser Government Programs, Inc.)
By: /s/ Timothy P. O'Connor
--------------------------------------
Name: Timothy P. O'Connor
Title: Treasurer
EDA, INCORPORATED
By: /s/ Timothy P. O'Connor
--------------------------------------
Name: Timothy P. O'Connor
Title: Treasurer
6
<PAGE>
GLOBAL TRADE & INVESTMENT, INC.
By: /s/ Timothy P. O'Connor
--------------------------------------
Name: Timothy P. O'Connor
Title: Treasurer
KAISER EUROPE, INC.
(formerly ICF Kaiser Europe, Inc.)
By: /s/ Timothy P. O'Connor
--------------------------------------
Name: Timothy P. O'Connor
Title: Treasurer
ICF KAISER / GEORGIA WILSON, INC.
By: /s/ Timothy P. O'Connor
--------------------------------------
Name: Timothy P. O'Connor
Title: Treasurer
ICF KAISER OVERSEAS ENGINEERING, INC.
By: /s/ Timothy P. O'Connor
-------------------------------------
Name: Timothy P. O'Connor
Title: Treasurer
ICF KAISER ENGINEERS PACIFIC, INC.
By: /s/ Timothy P. O'Connor
--------------------------------------
Name: Timothy P. O'Connor
Title: Treasurer
ICF KAISER ADVANCED TECHNOLOGY, INC.
By: /s/ Timothy P. O'Connor
--------------------------------------
Name: Timothy P. O'Connor
Title: Treasurer
7
<PAGE>
Exhibit 4(k)
AMENDMENT NO. 2 TO RIGHTS AGREEMENT
-----------------------------------
THIS AMENDMENT NO. 2 TO RIGHTS AGREEMENT, dated as of September 15, 1999
(this "Amendment") amends that certain Rights Agreement dated as of January 13,
1992, as amended, (the "Rights Agreement"), between ICF Kaiser International,
Inc., a Delaware corporation (the "Company"), and the Office of the Corporate
Secretary of the Company (the "Rights Agent").
WITNESSETH:
WHEREAS, the Rights Agreement was approved and adopted by the Board of
Directors of the Company on January 13, 1992;
WHEREAS, on July 2, 1999, the Board of Directors of the Company approved
and adopted Amendment No. 1 to the Rights Agreement; and
WHEREAS, on September 15, 1999, the Board of Directors of the Company
determined to further amend certain provisions of the Rights Agreement in a
manner the Board of Directors deems necessary and desirable and which has been
determined not to adversely effect the interests of the holders of the Rights
Certificates (as defined in the Rights Agreement);
NOW, THEREFORE, in consideration of the premises and mutual agreements
herein set forth, the parties hereby agree as follows:
1. The definition of "Permitted Offer" in Section 1(q) of the Rights
Agreement is hereby amended to add the following new Subsection 1(q)(iii), ",
and (iii) the acquisition (whether upon initial issuance or subsequent
acquisition) of the Company's Series 5 Redeemable Convertible Preferred Stock
and Common Stock, including the Common Stock issuable upon conversion of such
preferred stock, issued in exchange for the Company's 12% Senior Subordinated
Notes due 2003", after the phrase "all outstanding Common Stock" in Subsection
1(q)(ii) so that as amended, Section 1(q) of the Rights Agreement shall be in
its entirety as follows:
(q) "Permitted Offer" shall mean (i) a tender or exchange
offer which is for all outstanding Common Stock at a price and on
terms determined, prior to the purchase of shares under such
tender or exchange offer, by at least a majority of the members
of the Board of Directors who are not officers or employees of
the Company and who are not Acquiring Persons or Affiliates,
Associates, nominees or representatives of an Acquiring Person,
to be adequate (taking into account all factors that such
directors deem relevant including, without limitation, prices
that could reasonably be achieved if the Company or its assets
were sold on an orderly basis designed to realize maximum value)
and otherwise in the best interests of the Company and its
stockholders (other than the Person or any Affiliate or Associate
thereof on whose basis the offer is being made) taking into
account all
1
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factors that such directors may deem relevant, (ii)
following July 31, 2000, a cash tender offer which is for all
outstanding Common Stock, and (iii) the acquisition (whether upon
initial issuance or subsequent acquisition) of the Company's
Series 5 Redeemable Convertible Preferred Stock and Common Stock,
including the Common Stock issuable upon conversion of such
preferred stock, issued in exchange for the Company's 12% Senior
Subordinated Notes due 2003.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and attested, all as of the day and year first above written.
Attest: ICF KAISER INTERNATIONAL, INC.
By: /s/ Sandra D. Little By: /s/ James J. Maiwurm
------------------------- ---------------------------------------
Name: Sandra D. Little Name: James J. Maiwurm
--------------------- ---------------------------------
Title: Assistant Secretary Title: President and Chief Executive
--------------------- ---------------------------------
Officer
-------
Attest: OFFICE OF THE CORPORATE SECRETARY
ICF KAISER INTERNATIONAL, INC.
By: /s/ Sandra D. Little By: /s/ Shaun M. Martin
-------------------------- ---------------------------------------
Name: Sandra D. Little Name: Shaun M. Martin
-------------------- ----------------------------------
Title: Assistant Secretary Title: Treasurer and Corporate Secretary
------------------- ---------------------------------
2
<PAGE>
Exhibit 10(tt)
October 5, 1999
Nathaniel S. Levy
T. Rowe Price
100 East Pratt St.
Baltimore, Maryland 21202
John Campos
NorthStar Investment Management
300 First Stamford Place
Stamford, Connecticut 06902
Brian McGrath
Deutsche Bank
31 West 52/nd/ Street
New York, NY 10019
Agreement of Release, Consent and Waiver
----------------------------------------
We refer to the Indenture, dated as of December 23, 1996 (as
supplement and amended from time to time, the "Indenture"), by and among ICF
Kaiser International, Inc. (the "Company"), The Bank of New York, and each of
the following guarantors: Cygna Consulting Engineers and Project Management,
Inc.; Kaiser Government Programs, Inc. (formerly ICF Kaiser Government Programs,
Inc.); EDA, Incorporated; Global Trade & Investment, Inc.; Kaiser Europe, Inc.
(formerly ICF Kaiser Europe, Inc.); ICF Kaiser / Georgia Wilson, Inc.; ICF
Kaiser Overseas Engineering, Inc.; ICF Kaiser Engineers Pacific, Inc.; and ICF
Kaiser Advanced Technology, Inc.. Capitalized terms used herein without
definition shall have the meanings specified in the Indenture.
This letter shall serve to evidence our understanding and agreement as
follows:
1. The undersigned Holder are the beneficial holders of $14,000,000
in aggregate principal amount of the Company's 12% Senior Notes due 2003 (the
"Notes"), and hold individually the respective principal amounts set forth
opposite their names on the signature page of this agreement.
2. Each of the undersigned Holders confirms that, when paid an
amount equal to 88% of the principal amount of the Note(s) beneficially held by
it, together with interest accrued thereon from June 30, 1999 (such amount is
set forth in the attached instruction), by wire transfer of immediately
available funds to the account(s) specified in the attached instructions, the
liabilities, obligations, and indebtedness owing by the Company to each such
Holder and
1
<PAGE>
represented by the Notes beneficially held by it will be fully paid, released
and discharged (such payment by wire transfer, the "Payment").
3. In consideration for the Payment, each of the undersigned Holders
hereby agrees that it will:
(a) irrevocably consent to the amendments set forth in the Fifth
Supplemental Indenture, substantially in the form set forth in the attached
Exhibit A to this letter;
---------
(b) irrevocably waive any and all further rights under the Indenture
and the Notes, including, without limitation, Articles 3, 4, 5 and 9 of the
Indenture, and release the Company from any and all claims related to the
Notes and the Indenture; and
(c) deliver, or cause to be delivered, to the Trustee immediately
upon receipt of the Payment the Note(s) beneficially held by it.
4. In consideration for executing this agreement of release, consent
and waiver and each Holder's agreement to deliver the Notes beneficially held by
it to the Trustee, the Company agrees to deliver the Payment to each Holder
party hereto.
5. This agreement may be executed in one or more counterparts, and
by the different parties hereto in separate counterparts, each of which when
executed shall be deemed to be an original but all of which taken together shall
constitute one and the same agreement. This agreement shall be binding upon and
inure to the benefit of each party hereto, and each successor or assign of each
party hereto. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK, WITHOUT GIVING EFFECT TO THE
PRINCIPLES OF THE CONFLICTS OF LAWS THEREOF.
If you are in agreement with the foregoing, please so indicate by
signing in the space provided below, whereupon this letter shall become a
binding agreement among the parties hereto.
Very truly yours,
ICF KAISER INTERNATIONAL, INC.
By: /s/ Shaun M. Martin
-----------------------------------
Shaun M. Martin
Senior Vice President, Treasurer and
Secretary
2
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Accepted, confirmed and agreed as of
the date first above written.
T. ROWE PRICE HIGH YIELD FUND, INC.* Principal Amount of Notes
Beneficially Held:
/s/ Mark Vaselkiv $ 9,100,000
- -------------------------------------- -------------------
Name: Mark Vaselkiv
Title: Portfolio Manager
NORTHSTAR INVESTMENT MANAGEMENT* Principal Amount of Notes
Beneficially Held:
/s/ Robert Claiborne $ 500,000
- -------------------------------------- -------------------
Name: Robert Claiborne
Title: Vice President
DEUTSCHE BANK Principal Amount of Notes
Beneficially Held:
/s/ Brian McGrath $ 4,000,000
- -------------------------------------- -------------------
Name: Brian McGrath
Title: Director
PENN SERIES HIGH YIELD BOND FUND, INC.* Principal Amount of Notes
Beneficially Held:
/s/ Mark Vaselkiv $ 400,000
- -------------------------------------- -------------------
Name: Mark Vaselkiv
Title: Portfolio Manager
* Additional provision applicable to agreement as signed by T.Rowe Price, Penn
----------------------------------------------------------------------------
Series High Yield bond Fund, Inc. and NorthStar Investment Management:
---------------------------------------------------------------------
Notwithstanding anything to the contrary in the agreement, the Holders and the
Company agree that should the Payment be subject to avoidance and recovery
pursuant to the provisions of title 11, United States Code (the "Avoidance
Action"), then (a) the agreement shall be deemed rescinded, and its provisions
shall be null and void; (b) all of the Holders' right in respect of the Notes
(including the right to payment of 100% of the principal amount of the Notes)
shall be reinstated; (c) the consents and waivers set forth in paragraph 3 shall
be withdrawn as if never delivered; and (d) the Company shall be liable for the
costs and expenses (including reasonable attorneys' fees) incurred by the
Holders in defending any Avoidance Action.
3
<PAGE>
[Fifth Supplemental Indenture
to be attached to letter]
4
