UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
REINHOLD INDUSTRIES, INC. (FORMERLY KEENE CORPORATION)
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(Name of Issuer)
Class A Common Stock, par value $.01 per share
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(Title of Class of Securities)
75935A109
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(CUSIP Number)
KEENE CREDITORS TRUST
Richard A. Lippe, Esq. THE CHANCERY
Managing Trustee 190 WILLIS AVENUE
(516) 747-0300 MINEOLA, NEW YORK 11501
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(Name, Address and Telephone Number of Person Authorized to Receive
Notices and Communications)
July 31, 1996
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(Date of Event which Requires Filing of this Statement)
If the filing person has previouisly filed a statement on Schedule 13G to
report the acquisition which is the subject of this Schedule 13D, and is filing
this schedule because of Rule 13d-1(b)(3) or (4), check the following box |_|.
Check the following box if a fee is being paid with the statement |X|
Page 1 of 194 pages
The Index to Exhibits is on page 12.
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2
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SCHEDULE 13D
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CUSIP No. 75935A109
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1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Keene Creditors Trust
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) |_|
(b) |X|
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3 SEC USE ONLY
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4 SOURCE OF FUNDS*
OO
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(d) OR 2(e) |_|
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
New York
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----- ---------------------------------------------------
7 SOLE VOTING POWER
1,020,000 shares
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NUMBER OF ----- ---------------------------------------------------
SHARES 8 SHARED VOTING POWER
BENEFICIALLY
OWNED BY
EACH ----- ---------------------------------------------------
REPORTING ----- ---------------------------------------------------
PERSON 9 SOLE DISPOSITIVE POWER
WITH
1,020,000 shares
----- ---------------------------------------------------
----- ---------------------------------------------------
10 SHARED DISPOSITIVE POWER
----- ---------------------------------------------------
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
1,020,000 shares
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12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*|_|
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13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
51%
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14 TYPE OF REPORTING PERSON*
OO
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3
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SCHEDULE 13D
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CUSIP No. 75935A109
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1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Archie R. Dykes
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) |_|
(b) |X|
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3 SEC USE ONLY
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4 SOURCE OF FUNDS*
OO
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(d) OR 2(e) |_|
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
United States
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7 SOLE VOTING POWER
----- ---------------------------------------------------
NUMBER OF ----- ---------------------------------------------------
SHARES 8 SHARED VOTING POWER
BENEFICIALLY
OWNED BY 1,020,000 shares
EACH ----- ---------------------------------------------------
REPORTING ----- ---------------------------------------------------
PERSON 9 SOLE DISPOSITIVE POWER
WITH
----- ---------------------------------------------------
----- ---------------------------------------------------
10 SHARED DISPOSITIVE POWER
1,020,000 shares
----- ---------------------------------------------------
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
1,020,000 shares
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12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*|_|
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13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
51%
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14 TYPE OF REPORTING PERSON*
IN
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4
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SCHEDULE 13D
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CUSIP No. 75935A109
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1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Richard A. Lippe
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) |_|
(b) |X|
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3 SEC USE ONLY
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4 SOURCE OF FUNDS*
OO
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(d) OR 2(e) |_|
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
United States
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----- ---------------------------------------------------
7 SOLE VOTING POWER
----- ---------------------------------------------------
NUMBER OF ----- ---------------------------------------------------
SHARES 8 SHARED VOTING POWER
BENEFICIALLY
OWNED BY 1,020,000 shares
EACH ----- ---------------------------------------------------
REPORTING ----- ---------------------------------------------------
PERSON 9 SOLE DISPOSITIVE POWER
WITH
----- ---------------------------------------------------
----- ---------------------------------------------------
10 SHARED DISPOSITIVE POWER
1,020,000 shares
----- ---------------------------------------------------
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
1,020,000 shares
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12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*|_|
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13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
51%
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14 TYPE OF REPORTING PERSON*
IN
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5
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SCHEDULE 13D
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CUSIP No. 75935A109
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1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
John J. Robbins
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) |_|
(b) |X|
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3 SEC USE ONLY
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4 SOURCE OF FUNDS*
OO
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(d) OR 2(e) |_|
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
United States
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----- ---------------------------------------------------
7 SOLE VOTING POWER
----- ---------------------------------------------------
NUMBER OF ----- ---------------------------------------------------
SHARES 8 SHARED VOTING POWER
BENEFICIALLY
OWNED BY 1,020,000 shares
EACH ----- ---------------------------------------------------
REPORTING ----- ---------------------------------------------------
PERSON 9 SOLE DISPOSITIVE POWER
WITH
----- ---------------------------------------------------
----- ---------------------------------------------------
10 SHARED DISPOSITIVE POWER
1,020,000 shares
----- ---------------------------------------------------
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
1,020,000 shares
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12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*|_|
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13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
51%
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14 TYPE OF REPORTING PERSON*
IN
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6
Item 1. Security and Issuer
This statement on Schedule 13D (this "Statement") relates to the Class
A Common Stock (the "Class A Common Stock") of Reinhold Industries, Inc. a
Delaware corporation ("Reinhold"), which has its principal offices at 12827
Imperial Highway, Santa Fe Springs, California 90670-4713. The total authorized
shares of common stock, par value $0.01 per share ("Common Stock"), of Reinhold
consist of 1,480,000 shares of Class A Common Stock and 1,020,000 shares of
Class B Common Stock ("Class B Common Stock").
Pursuant to Rule 13d-3 promulgated under the Exchange Act, this
Statement relates to the shares of Class A Common Stock issuable upon conversion
of shares of Class B Common Stock. Each share of Class A Common Stock is
entitled to one vote per share. Each share of Class B Common Stock is
convertible, upon the occurrence of certain events, into one share of Class A
Common Stock, is entitled to one vote per share and votes together with the
Class A Common Stock as a class except with respect to the election of
directors. Class B Common Stock may be held only by the Keene Creditors Trust, a
New York trust (the "Trust"). While the Trust holds shares of Class B Common
Stock representing 25% or more of the aggregate shares of Common Stock then
outstanding, the Trust shall, voting as a class, be entitled to elect two of the
three directors of the Company, with the remaining director selected by the
holders of Class A Common Stock. While the Trust holds shares of Class B Common
Stock representing less than 25% but greater than or equal to 10% of the
aggregate shares of Common Stock then outstanding, the Trust shall, voting as a
class, be entitled to elect one of the three directors of the Company, with the
remaining two directors elected by the holders of Class A Common Stock. While
the Trust holds shares of Class B Common Stock representing 10% or more of the
aggregate shares of Common Stock then outstanding, no additional authorization
or issuance of Class A Common Stock shall be made without the prior written
consent of the Trust. Class B Common Stock shall convert into Class A Common
Stock upon the earlier of: (i) the sale, transfer or other disposition of the
Class B Common Stock by the Trust; (ii) the time that the shares of Class B
Common Stock held by the Trust represent less than 10% of the aggregate shares
of Common Stock then outstanding; or (iii) ten years from the Effective Date
(hereinafter used as defined in the Plan (as defined below) attached hereto as
Exhibit 2). The Trust may not transfer shares of Class B Common Stock until two
years after the Effective Date.
Item 2. Identity and Background
This statement is being filed by the Trust, which is governed by the
laws of the state of New York and was formed as an irrevocable trust pursuant to
a Trust Agreement dated as of July 31, 1996 (the "Trust Agreement") in form
approved by the United States District Court of the Southern District of New
York (the "Bankruptcy Court"). The Trust was formed to implement certain
portions of the plan of reorganization more particularly referred to below.
On July 29, 1993, Keene Corporation ("Keene") filed a voluntary
petition under Chapter 11 of the United States Bankruptcy Code (the "Bankruptcy
Code") in the Bankruptcy Court. The filings were precipitated by contingent
liabilities resulting from pending and potential litigation involving claims
against Keene and its affiliates relating to asbestos related diseases.
By order entered on June 14, 1996, the Bankruptcy Court confirmed
Keene's Fourth Amended Plan of Reorganization dated March 11, 1996 together with
the modifications thereto filed with the Bankruptcy Court on June 11, 1996
(collectively, the "Plan"). Portions of the Plan and the Trust Agreement are
summarized below. These summaries are qualified by reference to the Trust
Agreement (other than its exhibits and schedules) and the Plan, copies of which
are attached as Exhibits 1 and 2 hereto, respectively. Capitalized terms not
otherwise defined in this Statement are used as defined in the Plan and the
Trust Agreement.
Pursuant to the Plan, Keene was merged with and into its wholly-owned
subsidiary, Reinhold, with Keene being the surviving corporation, and as such
Keene was renamed "Reinhold Industries, Inc." Reinhold, as reorganized pursuant
to the Plan and as successor-in-interest to Keene, was required by the Plan to
issue 1,020,000 shares of Class B Common Stock, together with the transfer of
certain other assets of Keene, to the Trustees (the "Trustees") of the Trust for
the benefit of holders of Asbestos-Related Claims and Demands.
The Trust was issued such 1,020,000 shares of Class B Common Stock on
July 31, 1996.
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7
The Trust will initially be administered by three independent persons as
trustees (the "Trustees"). The initial Trustees of the Trust are Archie R.
Dykes, Richard A. Lippe, and John J. Robbins. The Trustees have elected Mr.
Lippe as Managing Trustee.
Mr. Dykes, 65, is currently Chairman of Capital City Holdings, Inc.,
Nashville, Tennessee, a venture capital firm and has a business address of
Rivergate Executive Park, 907 Two Mile Parkway, Suite D-5, Goodlettsville,
Tennessee. He has served in that capacity since 1988 prior to which he was
Chairman, President and Chief Executive Officer of the Security Benefit Group of
Companies, Topeka, Kansas, an insurance and management investment firm, from
1980 to 1987, Chancellor of The University of Kansas from 1973 to 1980 and
Chancellor of The University of Tennessee from 1967 to 1973. He serves as a
director of Whitman Corp., Bradford Capital Partners and Fleming Company Inc. He
holds a Doctorate from The University of Tennessee and a Masters and a B.S. from
East Tennessee State University.
Mr. Lippe, 58, is currently a partner in the Corporate & Securities Law
Group of the law firm of Meltzer, Lippe, Goldstein, Wolf & Schlissel, The
Chancery, 190 Willis Avenue, Mineola, New York. He also serves as outside
General Counsel to Cheyenne Software, General Counsel to the Long Island High
Technology Incubator and Counsel to the Long Island Venture Fund. He holds a
B.A. from Tufts University and an LL.B. from The University of Pennsylvania.
Mr. Robbins, 57, is a Certified Public Accountant and has an address of
112 Walton Heath, Williamsburg, Virginia. Prior to his retirement in 1992, Mr.
Robbins had been a partner since 1973 in Kenneth Leventhal & Company, a public
accounting firm which is now part of Ernst & Young, LLP, where from 1979 through
his retirement he served as the Managing Partner of such firm's New York Office.
He holds a B.B.A. from The University of Texas.
The Trust generally may take action by a vote of at least two Trustees
at a meeting at which a quorum of at least two Trustees is present. At such time
as there is only one Trustee (as described below), action will be taken by the
vote of that Trustee. Each Trustee will serve for three years (the "Initial
Term") or until death, incapacity, resignation or removal. Upon the expiration
of the Initial Term, one Trustee, selected by the two other Trustees with the
consent of a Trust Advisory Committee (the "TAC"), shall serve until termination
of the Trust or until such Trustee's death, incapacity, resignation or removal.
Any Trustee may be removed for cause by the majority vote of the other Trustees.
During the Initial Term a vacancy in the position of a Trustee is filled by
unanimous vote of the remaining Trustees, after consultation with the TAC. After
the Initial Term, if a vacancy occurs, the TAC shall nominate a successor
trustee for approval of the Bankruptcy Court or before a vacancy occurs the sole
remaining Trustee may appoint a successor with the consent of the TAC.
The TAC is the three member Trust Advisory Committee established to
consult with and advise the Trustees, the initial membership of which was
selected by the Official Committee of Unsecured Creditors. The issues concerning
which the Trustees must consult the TAC are described in Section 5.1(b) of the
Trust Agreement. In addition, the issues of Trust administration raised in Trust
Agreement Sections 4.3(a) and 4.3(b) (appointment of successor Trustees) and 6.3
(amendments to the Trust Agreement) require the consent of the TAC before the
Trustees can implement any action on behalf of the Trust with respect thereto.
Valid consent by the TAC requires approval by a majority of its members. Actions
requiring consent of the TAC but for which the TAC has withheld consent may only
be taken upon Bankruptcy Court approval after reasonable notice to the TAC.
The Trust currently has no officers.
During the past five years neither the Trust nor any of the Trustees
has been convicted in a criminal proceeding (excluding traffic violations or
similar misdemeanors) or been a party to any civil proceedings of a judicial or
administrative body of competent jurisdiction as a result of which any
individual or entity was subject to a judgment, decree or final order enjoining
future violations of, or prohibiting or mandating activities subject to federal
or state securities laws or finding any violation with respect to such laws.
The principal office of the Trust is at The Chancery, 190 Willis
Avenue, Mineola, New York 11501. Each of the Trustees is a citizen of the United
States.
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8
Item 3. Source and Amount of Funds
On July 31, 1996, pursuant to the Plan, Reinhold contributed to the
Trust 1,020,000 shares of Class B Common Stock. The consideration for the Class
B Common Stock is set forth in Section 1.4 of the Trust Agreement.
Item 4. Purpose of Transaction
Pursuant to the Plan, the Trust has been funded with, among other
things, 1,020,000 shares of Class B Common Stock. The purposes of the
transaction are set forth in Section 1.2 of the Trust Agreement.
The Trustees currently do not expect to participate in the management
of Reinhold. Pursuant to the By-Laws of Reinhold, the total number of directors
of the Reinhold Board of Directors (the "Board") was set at three. Pursuant to
the Plan, on the Effective Date, the initial members of the Board consisted of
one person nominated by the Board of Directors of Keene who had been the Chief
Executive Officer of Reinhold Industries, Inc. prior to its merger with Keene
and two persons selected by the Official Committee of Unsecured Creditors and
the Legal Representative for Future Asbestos-Related Claimants. Such initial
directors shall serve until their successors have been elected and qualified or
until their death, resignation, disqualification or removal. Pursuant to the
terms of the Reinhold Amended and Restated Certificate of Incorporation (the
"Certificate"), as long as the number of shares of Class B Common Stock owned by
the Trust represents 25% or more of the outstanding shares of Common Stock, the
Trust has the right to elect two of Reinhold's three directors (the "Class B
Directors"). If the Trust owns shares of Class B Common Stock representing less
than 25% but greater than or equal to 10% of the outstanding shares of Common
Stock it will have the right to elect one Class B Director. At such time that
the Trust owns shares of Class B Common Stock representing less than 10% of the
outstanding shares of Common Stock such Class B Common Stock shares shall
automatically be converted into an equal number of shares of Class A Common
Stock and the Trust shall no longer have the right to elect any Class B
Directors. The Reinhold By-Laws also provide that any director may be removed
from office, with or without cause, by the affirmative vote of such number of
shares of Common Stock that would have been sufficient to elect such director if
then voted at a meeting for such purpose. The Trustees have not determined
whether or not to take any present action with respect to the current Class B
Directors or to elect the same or different Class B Directors at the first
annual meeting of shareholders of Reinhold (presently expected to take place in
August 1997) or how they will otherwise vote the Trust's Class B Common Stock at
such annual meeting.
In accordance with the Plan, on the Effective Date, 980,000 shares of
Class A Common Stock were issued by Reinhold to various persons other than the
Trust. The holders of Class A Common Stock presently have the right to elect one
of Reinhold's three directors (a "Class A Director"). However, if the number of
Class B Directors decreases as described above, the number of Class A Directors
will correspondingly increase. In addition, pursuant to a share authorization
agreement executed by the Trustees and Reinhold in accordance with the terms of
the Plan (the "Share Authorization Agreement"), for so long as the Trust owns
shares of Class B Common Stock representing 10% or more of the outstanding
shares of Common Stock, Reinhold shall not issue any additional shares of Class
A Common Stock without the consent of the Trustees.
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9
The Certificate also contains provisions restricting the transfer of
shares of Common Stock and requiring the automatic conversion of Class B Common
Stock into Class A Common Stock, both as more fully described below. The
Certificate provides that only the Trust may hold shares of Class B Common Stock
and that, upon the sale, transfer or disposition of any shares of Class B Common
Stock by the Trust (other than to an entity in which the Trust owns all the
beneficial interests or in connection with the pledge or hypothecation of such
shares to secure bona fide indebtedness that is not convertible into Class B
Common Stock), such shares shall automatically be converted into an equal number
of shares of Class A Common Stock. The Certificate also provides that all of the
then outstanding shares of Class B Common Stock shall automatically be converted
into an equal number of shares of Class A Common Stock upon the earlier to occur
of (a) the date upon which the shares of Class B Common Stock owned by the Trust
represent less than 10% of the aggregate outstanding shares of Common Shares and
(b) the tenth anniversary of the Effective Date.
The Certificate also provides that, for a period of 25 months from the
Effective Date, an owner of greater than 5% of the issued and outstanding Common
Stock (including therefore the Trust) may not transfer, convey, assign, pledge
or otherwise dispose of all or any interest in its shares of Common Stock or
grant an option or contractual right to acquire ownership (collectively, to
"Transfer") of such shares and no holder of Common Stock may Transfer shares to
any person or group of persons acting in concert if after such Transfer such
person or group would own greater than 4.75% of the issued and outstanding
shares of Common Stock. Any such Transfers are deemed null and void ab initio.
In addition, pursuant to a registration rights agreement executed by the
Trustees and Reinhold in accordance with the terms of the Plan (the
"Registration Rights Agreement"), if at any time Reinhold registers any of its
equity securities for sale pursuant to the Securities Act of 1933, as amended,
the Trust may request the inclusion of, and Reinhold will use reasonable
diligence to so include, shares of the Trust's Class B Common Stock. The
Registration Rights Agreement also provides that at any time subsequent to the
second anniversary of the Effective Date the Trust may request that Reinhold use
its best efforts to register shares of the Class B Common Stock for sale by the
Trust pursuant to the Securities Act of 1933, as amended.
The foregoing is a summary of certain provisions of the Trust
Agreement, the Plan, the Share Authorization Agreement, the Registration Rights
Agreement and the Certificate and is qualified in its entirety by reference to
such documents, which are attached hereto as Exhibits 1 through 5, respectively.
Depending on numerous circumstances, including the price of the Class A
Common Stock, the amount of the Trust's holdings of Class B Common Stock, the
availability of funds and the benefit to the Trust, the Trust may purchase Class
A Common Stock, but it has no current plans to do so.
Other than as stated above, the Trust and Trustees have no plans or
proposals which relate to or would result in any of the following:
(a) The acquisition by any person of additional securities of
Reinhold, or the disposition of securities of Reinhold;
(b) An extraordinary corporate transaction such as a merger,
reorganization or liquidation, involving Reinhold or any of its
subsidiaries;
(c) A sale or transfer of a material amount of assets of Reinhold or
any of its subsidiaries;
(d) Any change in the present board of directors or management of the
Reinhold, including any plans or proposals to change the number or
term of directors or to fill any existing vacancies on the board;
(e) Any material change in the present capitalization or dividend
policy of Reinhold;
(f) Any other material change in Reinhold's business or corporate
structure;
<PAGE>
10
(g) Changes in Reinhold's charter, by-laws or instruments
corresponding thereto or other actions which may impede the
acquisition of control of Reinhold by any person;
(h) Causing a class of securities of Reinhold to be delisted from a
national securities exchange or to cease to be authorized to be
quoted in an inter-dealer quotation system of a registered
national securities association;
(i) A class of equity securities of Reinhold becoming eligible for
termination of registration pursuant to Section 12(g)(4) of the
Securities Exchange Act of 1934; or
(j) Any action similar to any of those enumerated above.
Item 5. Interest in Securities of the Company
The Trust may be deemed to be the beneficial owner of 1,020,000 shares
of Class B Common Stock. Based on the 980,000 shares of Class A Common Stock
stated in the Plan to be outstanding, these shares constitute 51% of the
outstanding shares of Common Stock. Solely as a result of their positions as
trustees of the Trust, each of the Trustees may be deemed to beneficially own
all of the shares of Class B Common Stock beneficially owned by the Trust and,
accordingly, each of them disclaims beneficial ownership of those shares of
Class B Common Stock.
Subject to the terms of the Plan, the Trust, acting through its
Trustees, has the sole power to vote its Class B Common Stock and to dispose or
direct the disposition thereof.
Neither the Trust nor any of the Trustees has effected any transactions
in the Common Stock during the past 60 days, except the Trust's acquisition of
Class B Common Stock by contribution from Reinhold as described above. None of
the Trustees individually owns any Common Stock.
Item 6. Contracts, Arrangements, Understandings or Relationships with Respect
to Securities of the Issuer.
Except as noted above neither the Trust nor any of the Trustees has any
contracts, arrangements, understandings or relationships with respect to any
securities of Reinhold.
Item 7. Material To Be Filed as Exhibits
Exhibit Number Title
-------------- -----
1 Trust Agreement dated as of July 31, 1996.
2.1 Fourth Amended Plan of Reorganization dated March
11, 1996.
2.2 Modifications to the Fourth Amended Plan of
Reorganization filed with the Bankruptcy Court on
June 11, 1996
3 Share Authorization Agreement dated as of July 31,
1996
4 Registration Rights Agreement dated as of July 31,
1996
5 Amended and Restated Certificate of Incorporation
of Reinhold Industries, Inc.
<PAGE>
11
SIGNATURES
After reasonable inquiry and to the best knowledge and belief of each
person or entity set forth below, each such person or entity certifies that the
information set forth in this Statement is true, complete, and correct.
Dated: August 12, 1996
Keene Creditors Trust
By: /s/ Archie R. Dykes
------------------------------------
Archie R. Dykes, Trustee
By: /s/ Richard A. Lippe
------------------------------------
Richard A. Lippe, Trustee
By: /s/ John J. Robbins
------------------------------------
John J. Robbins, Trustee
<PAGE>
12
Exhibit
Number Title Method of Filing Page
------ ----- ---------------- ----
1 Trust Agreement dated as of July 31, Filed herewith 13
1996.
2.1 Fourth Amended Plan of Reorganization Filed herewith 30
dated March 11, 1996
2.2 Modifications to the Fourth Amended Filed herewith 164
Plan of Reorganization filed with the
Bankruptcy Court on June 11, 1996
3 Share Authorization Agreement dated Filed herewith 173
as of July 31, 1996
4 Registration Rights Agreement dated Filed herewith 176
as of July 31, 1996
5 Amended and Restated Certificate of Filed herewith 187
Incorporation of Reinhold Industries,
Inc.
13
CREDITORS TRUST AGREEMENT
This Creditors Trust Agreement ("Trust Agreement") dated as of July 31,
1996 among Keene Corporation, as trustor (the "Trustor" or the "Debtor"), Archie
R. Dykes, Richard A. Lippe, and John J. Robbins, as Trustees, and New Keene.
WHEREAS, the Trustor filed a voluntary petition for relief under Title
11 of Chapter 11 of the United States Code (the "Bankruptcy Code") on December
3, 1993 and has proposed a Fourth Amended Plan of Reorganization, as Modified
(the "Plan")* which called for the establishment of the Creditors Trust (the
"Trust"); and
WHEREAS, pursuant to the Plan, the Trust is to use its assets and/or
income to liquidate and to pay in accordance with the Asbestos Related Personal
Injury and Asbestos In Buildings Claims Resolution and Distribution Procedures
attached hereto as Exhibit A and B (collectively, the "Procedures") Asbestos
Related Claims and Demands against the Debtor, as defined in Sections 101(5) and
524(g)(5) of the Bankruptcy Code, respectively; and
WHEREAS, pursuant to the Plan, the Trust is intended to qualify as a
"designated settlement fund" or a "qualified settlement fund" within the meaning
of Section 1.468B-1 of the Treasury regulations promulgated under Section 468B
of the Internal Revenue Code; and
WHEREAS, the Bankruptcy Court (the "Court") has determined that the
Trust and the Plan satisfy all the prerequisites for a supplemental injunction
pursuant to Section 524(g) of the Bankruptcy Code, which Permanent Channelling
Injunction has been entered in connection with the Order confirming the Plan;
WHEREAS, in order to effectuate the Debtor's Plan, to provide for the
payment of Asbestos Related Claims and Demands and to receive the benefits under
the Internal Revenue Code of so providing for certain of such payments, the
Trustor desires to enter into this Trust Agreement with the Trustees and
transfer the Creditors Trust Distribution (the "Trust Assets") to the Trust
pursuant hereto.
NOW, THEREFORE, IT IS HEREBY AGREED as follows:
ARTICLE I
DECLARATION OF TRUST
1.1 Name. The Trust shall be known as the "Keene Creditors Trust", and
the Trustees may transact the business and affairs of the Trust in that name.
1.2 Purpose. The purposes of the Trust are (i) to assume the
liabilities within the meaning of Section 524(g)(2)(B)(i)(1) of the Bankruptcy
Code of the Debtor and its successors in interest resulting from personal
injury, wrongful death, or property-related damage attributable to the presence
of, or exposure to, the Debtor's asbestos or asbestos-containing products; (ii)
to use the Trust Assets and income to pay holders of valid Asbestos Related
Claims and Demands in accordance with this Trust Agreement and the Procedures;
and (iii) to otherwise comply in all respects with the requirements of a trust
set forth in Section 524(g)(2)(B)(i) of the Bankruptcy Code.
- -----------------------------
* Unless the context requires otherwise, all capitalized terms used
herein and not otherwise defined have the meanings assigned thereto in
the Plan for Keene Corporation as confirmed by an Order of the
Bankruptcy Court.
<PAGE>
14
1.3 Transfer of Assets. The Trustor hereby transfers and assigns to the
Trust the assets listed on Schedule 1 attached hereto (the "Trust Assets")
having heretofore obtained all consents and taken all other steps prerequisite
to such transfer and assignment. New Keene, as the successor to the Trustor for
this purpose, shall take any and all steps as may be further necessary to
effectuate fully the transfer and assignment of the Trust Assets.
1.4 Acceptance of Assets and Assumption of Liabilities.
a) In connection with and in furtherance of the purposes of the Trust
and subject to Section 4.4, below, the Trustees hereby expressly accept the
transfer and assignment to the Trust of the Trust Assets and the Trust hereby
further expressly assumes liability within the meaning of Section
524(g)(2)(B)(i)(1) of the Bankruptcy Code for, and undertakes and shall control,
liquidating in accordance with the Procedures all Asbestos Related Claims and
Demands.
b) The Trust shall indemnify New Keene for any expenses, costs, fees
(including attorneys fees), judgments, settlements, or other liabilities
asserted at any time after the Effective Date of the Plan arising from or
incurred in connection with an Asbestos Related Claim or Demand. Nothing in this
section or any other section of this Trust Agreement shall be construed in any
way to limit the scope, enforceability, or effectiveness of the Permanent
Channelling Injunction issued by the Bankruptcy Court in connection with the
Plan.
ARTICLE II
POWERS; TRUST ADMINISTRATION
2.1 Powers. (a) Subject to the limitations set forth in this Trust
Agreement, the Trustees shall have the power to take any and all such actions as
in the judgment of the Trustees are necessary or convenient to effectuate the
purposes of the Trust, including, without limitation, each power expressly
granted in Subsection 3.1(c) below and any power reasonably incidental thereto.
(b) Except as provided in the Plan or otherwise specified herein, the
Trustees need not obtain an order of approval of any court in the exercise of
any power or discretion conferred hereunder.
(c) Without limiting the generality of Subsection 2.1(a) above, the
Trustees shall have the power to:
(i) receive and hold the Trust Assets, and invest monies held
from time to time therein, transfer, exchange or sell any or all
assets of the Trust on such terms as the Trust considers proper and to
sell all or any part of the securities issued by the Trustor that are
included in the Trust Assets, subject to the restrictions set forth in
the Amended and Restated Certificate of Incorporation of New Keene;
(ii) supervise and administer the Procedures;
(iii) pay Trust expenses, liabilities and to pay Claims and
Demands as such Claims and Demands are determined in accordance with
the Procedures or otherwise;
(iv) borrow money and issue notes and other evidences of
indebtedness (which notes or other evidences of indebtedness shall
exonerate the Trustees from personal liability with respect thereto)
in the ordinary course of operations for payment of indemnification
liabilities and other Trust expenses and the Claims;
(v) enter into any other agreement required by the Plan or
reasonably necessary or beneficial to implement the Plan and the
Procedures and perform all of the Trust's obligations thereunder,
including, without limitation, enter into any agreement with other
asbestos claims resolution organizations to implement the Procedures;
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15
(vi) commence, prosecute, settle, dismiss or abandon any of the
Causes of Action;
(vii) extend a line of credit to New Keene pursuant to the terms
of the New Keene Credit Facility;
(viii) exercise all rights and benefits accruing to the Trust as
owner of any shares of New Common Stock that the Trust shall own from
time to time;
(ix) establish such funds, reserves and accounts within the
Trust, in addition to the funds created hereby, as deemed by the
Trustees to be useful in carrying out the purposes of the Trust;
(x) sue and be sued and participate, as a party or otherwise, in
any judicial, administrative, arbitrative or other proceeding,
including, without limitation, in connection with the Procedures;
(xi) adopt and amend any by-laws desirable for the administration
of the Trust;
(xii) appoint such officers and hire such employees and engage
such legal, financial and other advisors, professionals and agents as
the business of the Trust requires and to delegate to such persons
such powers, authority, and discretion as the Trustees deem advisable
or necessary in order to carry out the purposes of the Trust, and pay
the Trustees, subject to Section 4.5 and pay such officers, employees,
advisors and agents reasonable compensation as determined by the
Trustees and properly documented out-of-pocket costs and expenses;
(xiii) to pay the compensation and properly documented
out-of-pocket expenses and costs of the members of the TAC and any
legal, financial and other advisors or professionals retained by the
TAC;
(xiv) enter into such other arrangements with third parties as
are deemed by the Trustees to be useful in carrying out the purposes
of the Trust (including, without limitation, engaging an Entity having
trust powers to act as paying agent, depositary, custodian, or trustee
with respect to funds, reserves or accounts created hereby or
established pursuant hereto);
(xv) indemnify (and purchase insurance indemnifying) the
Trustees, officers, employees, agents, advisors and professionals and
representatives of the Trust, the members of the TAC and their
professionals and advisors and New Keene to the fullest extent that a
corporation organized under New York law is from time to time entitled
to indemnify its directors, officers, employees, agents or
representatives;
(xvi) enter into any contract or otherwise engage in any
transaction with any Trustee or any Entity affiliated with any
Trustee, provided, however, that such contract or such transaction is
approved by the unanimous vote of the Trustees voting thereon, it
being understood that to the extent permitted by law the usual rules
prohibiting fiduciaries from dealing with themselves as individuals or
from dealing with respect to any manner in which they have a personal
interest shall not apply to the Trustees;
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16
(xvii) delegate any or all of the discretionary power and
authority herein conferred at any time with respect to all or any
portion of the Trust Assets to any one or more reputable individuals
or recognized institutional advisors or investment managers without
liability for any action taken or omission made because of any such
delegation;
(xviii) associate with, contract with and/or use the resources of
and/or merge with any other claims resolution facility if the Trustees
shall determine by unanimous vote that such claims resolution facility
has the capacity to evaluate and/or pay Claims and Demands in a manner
generally consistent with the purposes of the Trust and the Plan, and
not inconsistent with the Procedures; and
(xix) execute and deliver such deeds, leases and other
instruments as the Trustees consider proper in administering the
Trust.
(d) The Trustees on behalf of the Trust shall not have the power to
guarantee any debt of other Entities, except in connection with the sale of
Trust Assets in which case the Trust shall have the power to provide a guarantee
in an amount not exceeding the consideration received by the Trust on the sale.
2.2 Administration. (a) The Trust shall be administered as follows:
(i) Offices. The principal office of the Trust shall be in the
City of Mineola or at such other place, within or without the State of
New York, as the Trustees may from time to time determine to be
appropriate for the efficient and cost-effective administration of the
Trust.
(ii) Regular Meetings. Regular meetings of the Trustees may be
held at such time as from time to time shall be determined by the
Trustees with notice to the TAC; provided, however, that the Trustees
shall meet at least once per calendar quarter during the first year
following the execution of this agreement and at least once per year
thereafter.
(iii) Special Meetings; Notice. Special meetings of the Trustees
shall be held whenever called by the Managing Trustee (defined below).
Notice of each such meeting shall be mailed by first class mail,
postage prepaid, to each Trustee and the members of the TAC, addressed
to them at their residences or usual places of business, at least
three days before the date on which the meeting is to be held, or
shall be sent to such place by facsimile, telegraph, cable, radio or
wireless, or be delivered personally or by hand or by express mail or
overnight courier or by telephone, not later than the day before the
day on which such meeting is to be held. Such notice shall state the
place, date and hour of the meeting and the purpose(s) for which it is
called. In lieu of the notice to be given as set forth above, a waiver
thereof in writing, signed by the Trustees entitled to receive such
notice and by the members of the TAC, either before or after the
meeting, shall be deemed equivalent thereto for purposes of this
Section.
(iv) Action Without a Meeting; Meeting by Conference Call. Any
action required or permitted to be taken at any meeting of the
Trustees or the TAC may be taken without a meeting if all of the
Trustees or all the members of the TAC, as the case may be, consent
thereto in writing, and the writing or writings are filed with the
minutes of proceedings of the Trustees or the TAC.
The Trustees or members of the TAC may participate in a meeting
of the Trustees or the TAC, as the case may be, by means of conference
telephone or similar communication equipment provided that all persons
participating in the meeting can hear each other. Participation in a
meeting pursuant to this paragraph shall constitute presence in person
at such meeting.
<PAGE>
17
(b) Accounting Period. The accounting period for the Trust (the "Fiscal
Year") shall be selected by the Trustees.
(c) Delivery of Trust Documents to New Keene. The Trustees shall timely
file or shall deliver to New Keene such documents and other information as New
Keene may reasonably require in order to permit it to timely file such income
tax and other returns and statements as are required of it to comply with
applicable provisions of the Internal Revenue Code and state law and any
regulations promulgated thereunder.
(d) Annual Reports. The Trustees shall cause to be prepared and filed
with the Court, with copies to the members of the TAC, as soon as available but,
in any event, within 90 days following the end of each Fiscal Year, an annual
report containing financial statements of the Trust (including, without
limitation, a balance sheet and a statement of operations for such Fiscal Year)
audited by a firm of independent public accountants selected by the Trustees and
certified by such firm as to fairness of presentation and consistency, a report
on the number of Claims received and the number of Claims liquidated, if any,
and the amount per Claim paid or payable and such other information as the Trust
deems relevant.
(e) Tax Returns. The Trustees shall timely file income tax and other
returns and statements and comply with all withholding obligations as required
under applicable provisions of the Internal Revenue Code and state law and any
regulations promulgated thereunder.
(f) Settlement of Trustees' Accounts. Notwithstanding any state law to
the contrary, the Court shall have exclusive jurisdiction over the settlement of
the accounts of the Trustees, whether such account is rendered by the Trustees
themselves or is sought by any person holding an Asbestos Related Claim or
Demand or other person. The Trustees shall render successive accounts covering
periods of one year. In addition, an account shall be rendered for the period
ending on the date of the death, resignation, removal or retirement of any
Trustee. Upon the acceptance of any such account by the Court after hearing on
notice to New Keene, the TAC and such other parties as the Court shall
designate, the Trustees shall be discharged from any further liability or
responsibility to any person holding an Asbestos Related Claim or Demand or
other Person, as to all matters embraced in such account.
ARTICLE III
ACCOUNTS, PAYMENTS AND INVESTMENTS
3.1 Accounts.
(a) The Trustees may, from time to time, create additional funds,
reserves and accounts within the Trust as they may deem necessary, prudent or
useful in order to provide for the payment of Trust expenses, Claims and Demands
or otherwise to effectuate the purposes of the Trust and may, with respect to
any such fund, reserve or account, restrict the use of monies therein.
(b) After establishing a reasonable reserve for expenses of the Trust
including indemnification of the Trustees and the TAC, if required, the Trustees
shall promptly establish a separate fund (the "Litigation Reserve") which
Litigation Reserve shall be separately maintained solely for the prosecution of
the Causes of Action in an amount determined by the Trustees to be sufficient
for the costs and expenses of the full prosecution of the Causes of Action. The
Litigation Reserve shall be maintained as a separate fund until the Transaction
Lawsuit and the Bairnco Lawsuit are concluded. The amount of the Litigation
Reserve shall be determined with the advice and consent of the TAC.
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(c) After payment of expenses of the Trust, including, establishment of
a reserve for the reasonable future expenses of the Trust, the Litigation
Reserve pursuant to Section 3.1(b) above and line of credit to New Keene as
provided for in subsection 2.1(c)(vii) and, if necessary, a reserve for the
indemnification of the Trustees and the TAC, the remaining Cash and any
additional cash received by the Trust, net of expenses ("Available Cash") shall
be allocated into two funds as follows:
(i) 92 1/2% of the first $100 million of Available Cash; 90% of
Available Cash between $100 million and $150 million and 87 1/2% of
Available Cash above $150 million shall be held in a fund for
distributions to holders of Asbestos Related Personal Injury Claims
and Demands (the "Asbestos Personal Injury Fund");
(ii) 7 1/2% of the first $100 million of Available Cash 10% of
Available Cash between $100 and $150 million and 12 1/2% of Available
Cash above $150 million shall be held in a fund for distributions to
holders of Asbestos in Buildings Damage Claims (the "Asbestos in
Buildings Fund").
3.2 Payments.
(a) At such time as the Trust has at least $30 million of Available
Cash, or should the Trustees conclude after consulting with the TAC that it is
highly unlikely the Trust will ever have $30 million in Available Cash, the
Trust shall:
(i) cause estimates to be made of the numbers and values of
pending and projected Asbestos Related Personal Injury Claims and
Demands with the assistance of a consultant familiar with asbestos
disease claim projections and at the same time cause estimates to be
made of the total Available Cash and non cash assets held by the Trust
except for the Causes of Action unless at the time a settlement is
pending.
(ii) calculate the pro rata share of the Asbestos Personal Injury
Fund for the payment of Asbestos-Related Personal Injury Claims and
Demands so that the holders thereof shall receive substantially the
same percentage payment on subsequent distribution dates;
(iii) make distributions from the Asbestos Personal Injury Fund
in accordance with Procedures.
(iv) make distributions from the Asbestos in Buildings Fund in
accordance with the Procedures.
(b) At any time subsequent to the distribution of Available Cash
pursuant to Section 3.2(a) as the Trustees believe they are likely to have
Available Cash to pay claimants, the Trust shall cause an additional estimate to
be made of the numbers and values of Asbestos-Related Personal Injury Claims and
Demands and valuation of Trust Assets in the same manner as in subsections
3.2(a) (i) and (ii) above, and shall cause additional distributions to be made
in the same manner as in subsections 3.2(a)(iii) and 3.2(a)(iv) above.
(c) Recognizing that it is desirable to make payment to claimants
expeditiously, provided it is economically prudent given the funds then
available to the Trust, nevertheless the Trustees may determine to defer making
any payments under either of the Procedures if the Trustees, after consultation
with the TAC, determine that the administrative costs of such an expeditious
payment is proportionately so significant that no payment should be made pending
receipt of additional funds.
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(d) In making any estimates, judgments or decisions concerning the
future availability of cash, amounts to be paid, percentages, pro rata payments,
and timing of payments, the judgment and decisions of the Trustees shall be
final and conclusive and not subject to review .
3.3 Investments. Funds held in the Trust shall be invested in the
manner in which individuals of ordinary prudence, discretion and judgment would
act in the management of their own affairs, subject to the following limitations
and provisions:
(a) The Trust shall not acquire, directly or indirectly, equity in any
Entity (other than New Keene and its subsidiaries, successors and assigns) or
business enterprise if, immediately following such acquisition, the Trust would
hold more than 5% of the equity in such Entity or business enterprise unless (1)
such Entity or business enterprise is an asbestos claims processing facility or
(2) such equity has been conveyed to the Trust in full or partial consideration
for settlement of a lawsuit in which the Trust is a plaintiff. The Trust shall
not hold, directly or indirectly, more than 10% of the equity in any Entity
(other than New Keene and its subsidiaries, successors and assigns) or business
enterprise, unless (1) such Entity or business enterprise is an asbestos claims
processing facility or (2) such equity has been conveyed to the Trust in full or
partial consideration for settlement of a lawsuit in which the Trust is a
plaintiff.
(b) The Trust shall not acquire nor hold any long-term debt securities
unless such securities (i) are rated "A" or higher by Moody's Investors Service,
Inc. ("Moody's"), "AA" or higher by Standard & Poor's Corporation ("S&P") or
have been given an equivalent investment grade rating by another nationally
recognized statistical rating agency or (ii) have been issued or fully
guaranteed as to principal and interest by the United States of America or any
agency or instrumentality thereof or (iii) unless (1) such securities have been
issued by an asbestos claims processing facility or (2) such securities have
been conveyed to the Trust in full or partial consideration for settlement of a
lawsuit in which the Trust is a plaintiff.
(c) The Trust shall not acquire nor hold for longer than ninety days
any commercial paper unless such commercial paper is rated "Prime-1" or higher
by Moody's or "A-1" or higher by S&P or has been given an equivalent investment
grade rating by another nationally recognized statistical rating agency.
(d) The Trust shall not acquire nor hold any equity in any Entity or
business enterprise (other than New Keene, its subsidiaries, successors and
assigns) unless such equity is in the form of securities which are traded on a
national securities exchange or major international securities exchange or
through the National Association of Securities Dealers Automated Quotation
System or unless (1) such Entity or business enterprise is an asbestos claims
processing facility or (2) such equity has been conveyed to the Trust in full or
partial consideration for settlement of a lawsuit in which the Trust is a
plaintiff.
(e) The Trust shall not acquire nor hold any preferred stock unless
such preferred stock is rated "B" or higher by Moody's or "B+" or higher by S&P
or has been given an equivalent investment grade rating by another nationally
recognized statistical rating agency, and also complies with subsection (d)
above or unless such preferred stock is (1) preferred stock of an asbestos
claims processing facility or (2) such preferred stock has been conveyed to the
Trust in full or partial consideration for settlement of a lawsuit in which the
Trust is a plaintiff.
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(f) The Trust shall not acquire any debt securities or other
instruments issued by any Entity (other than debt securities or other
instruments issued or fully guaranteed as to principal and interest by the
United States of America or any agency or instrumentality thereof) if, following
such acquisition, the aggregate market value of all securities and instruments
issued by such Entity held by the Trust would exceed 5% of the aggregate value
of the Trust Assets, unless (1) such Entity or business enterprise is an
asbestos claims processing facility or (2) such securities or instruments have
been conveyed to the Trust in full or partial consideration for settlement of a
lawsuit in which the Trust is a plaintiff. The Trust shall not hold any debt
securities or other instruments issued by any Entity (other than debt securities
or other instruments issued or fully guaranteed as to principal and interest by
the United States of America or any agency or instrumentality thereof) to the
extent that the aggregate market value of all such securities and instruments
issued by such Entity held by the Trust would exceed 10% of the aggregate value
of the Trust Assets, unless (1) such Entity or business enterprise is an
asbestos claims processing facility or (2) such securities or instruments have
been conveyed to the Trust in full or partial consideration for settlement of a
lawsuit in which the Trust is the plaintiff.
(g) The Trust shall not acquire nor hold any certificates of deposit
unless all publicly held long-term debt securities, if any, of the financial
institution issuing the certificate of deposit and the holding company, if any,
of which such financial institution is a subsidiary, meet the standards set
forth in Section 3.3(b), above.
(h) The Trust shall not acquire nor hold any repurchase obligations
unless, in the opinion of the Trustees, they are adequately collateralized.
(i) Notwithstanding the foregoing guidelines, the Trust shall have the
authority to extend credit to New Keene as described above in Subsection
2.1(c)(vii) hereof.
3.4 Source of Payments. All Trust expenses and payments in respect of
Claims and Demands shall be payable solely out of the Trust Assets. Neither the
Trustees nor any officer, agent or employee of the Trust nor any member of the
TAC, nor the Trustor nor any of its present subsidiaries nor any director,
officer, employee or agent of the Trustor or any of their subsidiaries shall be
liable for the payment of any Trust expense, Claim, Demand or liability of the
Trust except as provided in the Plan, and no Entity shall look to any of the
foregoing Entities for satisfaction of any such expense, Claim, Demand or
liability; provided, however, that nothing in this Section 3.4 shall limit the
right of the Trustees and the Trust to claim against any officer, agent or
employee of the Trust, the Trustor, or any officer, director, agent or
subsidiary of the Trustor for breach of employment agreement or other breach of
duty to the Trust.
ARTICLE IV
TRUSTEES
4.1 Number; Managing Trustee.
(a) There shall be three Trustees (the "Initial Trustees") from the
commencement of the Trust until the expiration of the initial term of service
described below in Section 4.2. The Initial Trustees shall be those persons
named in the signature page hereto. After the Initial Term, there shall be one
Trustee until the termination of the Trust in accordance with the terms hereof.
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(b) One of the Initial Trustees selected by the Trustees shall serve as
Managing Trustee and shall be compensated for his or her services as Managing
Trustee. The Managing Trustee shall serve as the Trust's liaison, shall
coordinate and schedule meetings of the Trustees and shall handle all
administrative matters that come before the Trust.
4.2 Term of Service.
(a) Each Initial Trustee shall serve for a period of three years (the
"Initial Term") or until his or her death, incapacity, resignation or removal.
If any such event should occur within the Initial Term a successor will be
appointed.
(b) After the Initial Term, the Trustees shall select one Trustee to
serve as the sole Trustee until his or her (i) death or incapacity, (ii) removal
or (iii) resignation.
(c) Any Trustee may resign at any time by written notice to each of the
remaining Trustees and the TAC. Such notice shall specify a date when such
resignation shall take effect, which shall not be less than 30 days after the
date such notice is given, unless the remaining Trustees after consultation with
the TAC consent to an earlier date for the effect of a resignation.
(d) Any Trustee may be removed for cause by the majority vote of the
other Trustees, such removal to take effect at such time as the Trustees shall
by such vote determine.
4.3 Appointment of Successor Trustee.
(a) In the event of a vacancy during the Initial Term in the position
of Trustee, the vacancy shall be filled by unanimous vote of the remaining
Trustees after consultation with the TAC, who shall take into account the
relevant provisions hereof.
(b) If, after the Initial Term has expired, a vacancy is caused by
death, incapacity, resignation or removal of the sole Trustee, the TAC shall
nominate a successor trustee for approval of the Court. Before a vacancy occurs,
after the Initial Term, the sole Trustee may appoint a successor with consent of
the TAC.
(c) Immediately upon the appointment of any successor Trustee, all
rights, titles, duties, powers and authority of the predecessor Trustee
hereunder shall be vested in and undertaken by the successor Trustee without any
further act. No successor Trustee shall be liable personally for any act or
omission of his predecessor.
4.4 Liability of Trustees. No Trustee shall be liable to the Trust or
to any beneficiary thereof except for his own gross negligence or willful
misconduct. No Trustee shall be liable for any act or omission-of any officer,
agent or employee of the Trust unless such Trustee acted with gross negligence
or willful misconduct in the selection or retention of such officer, agent or
employee.
4.5 Compensation and Expenses of Trustees.
(a) Each of the Trustees shall receive compensation for his or her
services as Trustee in the amount of $30,000 per annum. The Managing Trustee
shall receive an additional compensation of $20,000 per annum. The Trustees
shall also receive $1000 per diem for meetings of the Trust attended by such
Trustee and other Trust business. All such amounts shall be increased or
decreased annually at the rate of the Consumer Price Index for urban wage
earners and clerical workers (U.S. City Average) unadjusted for seasonal
variation, published by the Bureau of Labor Statistics of the United States
Department of Labor.
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(b) All properly documented reasonable out-of-pocket costs and expenses
incurred by the Trustees in connection with the performance of their duties
hereunder shall be promptly reimbursed by the Trust.
4.6 Indemnification of Trustees and Others.
(a) The Trustees shall be indemnified by the Trust to the fullest
extent that a corporation or a trust organized under New York law is from time
to time entitled to indemnify its directors against any and all liabilities,
expenses, claims, damages or losses incurred by them in the performance of their
duties hereunder. Additionally, each member of the TAC (collectively,
"Additional Indemnitees") who was or is a party, or is threatened to be made a
party to any threatened, pending or completed action, suit or proceeding of any
kind, whether civil, administrative or arbitrative, by reason of any act or
omission of such Additional Indemnitees with respect to (i) the liquidation of
any Claims, (ii) the administration of the Trust and the implementation of the
Procedures, (iii) the prosecution of the Causes of Action, and (iv) any action
provided for in this agreement, shall be indemnified and defended by the Trust
against expenses, costs and fees (including attorneys' fees), judgments, awards,
costs, amounts paid in settlement, and liabilities of all kinds incurred by each
Additional Indemnitee in connection with or resulting from such action suit, or
proceeding, unless there is a final determination of a Court with jurisdiction
that such Additional Indemnitee acted other than in good faith and in a manner
such Additional Indemnitee reasonably believed to be in, or not opposed to, the
best interests of the holders of Claims and Demands.
(b) Reasonable expenses, costs and fees (including attorneys' fees)
incurred by or on behalf of a Trustee or Additional Indemnitee in connection
with any action, suit, or proceeding, whether civil, administrative or
arbitrative from which they are indemnified by the Trust pursuant to this
Section 4.6, may be paid by the Trust in advance of the final disposition.
(c) The Trustees shall have the power, generally or in specific cases,
to cause the Trust to indemnify the employees and agents of the Trust to the
same extent as provided in this Section 4.6 with respect to the Trustees.
(d) To the extent any indemnification under Section 4.6 of this
Agreement with respect to an action, suit, or proceeding requires a
determination that indemnification is proper in the circumstances, such
determination shall be made by the Trustee or Trustees who were not parties to
such action, suit, or proceeding, if at least one such Trustee was or is not a
party; otherwise, the determination as to each Trustee will be made by the
remaining Trustee or Trustees, regardless of whether or not he, she or they were
or are parties.
(e) The Trustee may purchase and maintain reasonable amounts and types
of insurance on behalf of any individual who is or was a Trustee, officer,
employee, agent or representative of the Trust or Additional Indemnitee against
liability asserted against or incurred by such individual in that capacity or
arising from his or her status as a Trustee, member of the TAC, officer,
employee, agent, professional advisor or representative thereof.
4.7 Trustees' Lien. The Trustees shall have a prior lien upon the Trust
Assets to secure the payment of any amounts payable to them pursuant to Sections
4.5 and 4.6.
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4.8 Trustees' Employment of Advisors. The Trustees may, but shall not
be required to, consult with counsel, accountants, appraisers, other
professionals or advisors and other parties deemed by the Trustees to be
qualified as experts on the matters submitted to them (regardless of whether any
such party is an affiliated party of any Trustee or is otherwise affiliated with
any of the Trustees in any manner, except as otherwise expressly provided for in
this Trust Agreement) and the advice of any such parties on any matters
submitted to them by the Trustees shall be full and complete authorization and
protection in respect of any action taken or not taken by the Trustees hereunder
in good faith and in accordance with the advice of any such party.
4.9 Additional Qualifications.
(a) No Trustee or related party of a Trustee shall represent or shall
have represented the Trustor or any Entity who asserts or has asserted a Claim
against Keene Corporation.
(b) No Trustee shall own any securities of Keene Corporation, New Keene
or any of its affiliates or have any other financial interest, direct or
indirect, in the Keene Corporation, New Keene, or any of its affiliates.
(c) If there has been a violation of Subsection (a) or (b), above, the
Trustee involved shall be subject to removal pursuant to Section 4.2(d), above.
4.10 Trustees' Service As Director of Reorganized Keene. No Trustee is
prohibited from serving as a director of New Keene. If any Trustee serves as a
director of New Keene, he or she shall not receive compensation for such service
over and above the compensation received as a Trustee under Section 4.5 but
shall receive a per diem allowance in the amount that New Keene pays its
directors for their attendance at meetings.
4.11 Bond. Notwithstanding any state law to the contrary each Trustee
(including any successor trustee) shall be exempt from giving any bond or
security in any jurisdiction.
ARTICLE V
THE TRUSTEE ADVISORY COMMITTEE
5.1 Duties. a. Consultation. The Trustee shall consult with the TAC and
the TAC shall assist the Trustees in the implementation of the Trust and the
Procedures generally by providing consulting services with respect to material
issues affecting the Trust including, but not limited to, implementation of
Procedures, development of payment rules, forms and procedures, releases, time
frames and other matters specified herein and in the Procedures. Where
consultation is required under the Trust or the Procedures, the Trustees need
only seek advice and counsel from the TAC.
b. Consent. The Trustees shall be obligated to obtain the consent of
the TAC in writing in order to (1) implement material changes in any Claims
Resolution Procedures; (2) dismiss, settle or abandon Transaction Lawsuit and
Bairnco Lawsuit; (3) associate with another claims facility; (4) amend any
provision of the Trust Agreement; (5) effect termination of this Trust pursuant
to Sections 6.2(a) (i), (ii), or (iii); (6) select a successor Trustee during
the Initial Term, and (7) determine the Litigation Reserve. The TAC shall not
unreasonably withhold any consent required hereunder.
c. Court approval. Any proposed action or decision of the Trustees for
which the consent of the TAC is required as to which the TAC withholds consent
may be taken only upon Court approval after reasonable notice to each member of
the TAC.
<PAGE>
24
5.2 Procedures. With respect to any matter relating to the Trust as to
which the consultation or consent of the TAC is expressly required, the Trust
shall:
(i) Provide the TAC reasonable access to the relevant documents,
records and reports and to experts and advisors retained by the Trust
and to the Trust staff during such time as the decision is being
considered;
(ii) bring the proposed decision to the attention of the TAC; and
(iii) provide the TAC with no fewer than 30 days to comment with
respect to the proposed decision, unless the TAC agrees to a shorter
period.
5.3 Number; Chairperson
(a) At the commencement of the Trust, there shall be three members of
the TAC (the "Initial TAC Members") who shall serve until the expiration of the
Initial TAC Term defined below in Section 5.4. The Initial TAC Members shall be
selected by the Committee pursuant to the Plan.
(b) There shall be a chairperson of the TAC selected by the Initial TAC
Members. The chairperson shall act as the TAC's liaison, shall coordinate and
schedule meetings of the TAC and shall handle all administrative matters that
come before the TAC.
(c) After expiration of the Initial TAC Term, the Chairperson of the
TAC, plus one other member of the TAC selected by the Initial TAC Members, shall
serve until the termination of the Trust or his or her death, incapacity,
resignation or removal and in such event, the remaining member shall serve as
the sole TAC member.
5.4 Term. (a) The Initial TAC Members shall serve for a period of three
years (the "Initial TAC Term") subject to any member's earlier death,
incapacity, removal or resignation.
(b) Any member of the TAC may resign at any time by at least
30 days written notice to each of the remaining members specifying the date when
such resignation shall take place.
(c) A member of the TAC may be removed from office by the
unanimous vote of the remaining members of the TAC and a determination of the
Bankruptcy Court that such removal is appropriate upon cause shown.
5.5 Successors. In the event of a vacancy in the membership of the TAC
during the Initial TAC Term, the vacancy shall be filled by the unanimous vote
of the remaining Initial TAC Members.
5.6 Quorum. The presence of two members during the Initial TAC Term and
so long as there are two members serving shall constitute a quorum of the TAC
for the transaction of business. In the absence of a quorum, the members present
may adjourn the meeting from time to time without notice. In order for the
Trustees to obtain consent of the TAC with respect to actions listed in Section
5.1 hereof and otherwise specified in this Agreement, the TAC must approve the
Trustees' recommendation by a majority unless otherwise specified herein.
5.7 TAC's Employment of Advisors. The TAC may, but shall not be
required to, consult with counsel, accountants, appraisers, advisors and other
parties on the matters submitted to them (regardless of whether any such party
is an affiliated party of any member of the TAC or is otherwise affiliated with
any of the TAC in any manner, except as otherwise expressly provided in this
Trust Agreement) and the advice of any such parties on any matters submitted to
them by the TAC shall be full and complete authorization and protection in
respect of any action taken or not taken by the TAC hereunder in good faith and
in accordance with the advice of any such party.
<PAGE>
25
5.8 Compensation and Expenses of Members of the TAC and their advisors.
The Chairperson of the TAC shall receive $25,000 as compensation for his or her
service plus $1,000 per diem. Each member of the TAC shall receive compensation
for his or her services as a member in the amount of $20,000 per annum plus
$1,000 per diem for meetings of the TAC. All properly documented, reasonable
out-of-pocket costs and expenses incurred by the TAC members in connection with
the performance of their duties hereunder will be promptly reimbursed by the
Trust.
5.9 Liability of TAC. No member of the TAC shall be liable to the Trust
or to any beneficiary thereof except for his or her own gross negligence or
willful misconduct. No member of the TAC shall be liable for any act or omission
of any member, advisor, agent or employee of the TAC unless the TAC acted with
gross negligence or willful misconduct in the selection or retention of such
member, advisor, agent or employee.
ARTICLE VI
GENERAL PROVISIONS
6.1 Irrevocability. The Trust is irrevocable, but this agreement is
subject to amendment as provided herein.
6.2 Termination.
(a) The Trust shall terminate on the date (the "Termination Date") that
is 90 days after the first occurrence of any of the following:
(i) the Trustees in their sole discretion decide to terminate the
Trust because (A) they deem it unlikely that new Asbestos Related
Claims or Demands will be filed against the Trust and (B) all Asbestos
Related Claims duly filed with the Trust have been liquidated and
satisfied and twelve consecutive months have elapsed during which no
new Asbestos Related Claim has been filed with the Trust;
(ii) the date on which the Bankruptcy Court order becomes final
which has approved the arrangements the Trustees have made to
establish Claims handling agreements and other necessary arrangements
with suitable third parties adequate to discharge all expected
remaining obligations and expenses of the Trust in a manner consistent
with this Trust Agreement and the Procedures;
(iii) if in the judgment of the Trustees, the continued
administration of the Trust is uneconomic or inimical to the best
interests of the persons holding Asbestos Related Claims and Demands
and the Trustees have obtained an order of the Court that the
termination of the Trust will not expose or subject New Keene or any
successor in interest to any increased or undue risk of having any
Asbestos Related Claims and Demands asserted against it or them or in
any way jeopardize the validity or enforceability of the Permanent
Channeling Injunction; or
(iv) 21 years less 91 days after the death of the last survivor
of all the descendants of Joseph P. Kennedy, Sr. of Massachusetts
living on the date hereof.
<PAGE>
26
(b) On the Termination Date, after payment of all the Trust's
liabilities has been provided for, all funds remaining in the Trust estate shall
be transferred to charitable organization(s) selected by the Trustees using
their reasonable discretion; provided, however, that (i) if practicable, the
charitable organization(s) shall be related to the treatment, research, or the
relief of suffering of individuals suffering from asbestos disorders, and (ii)
the tax-exempt organization(s) shall not bear any relationship to New Keene.
(c) As soon as practicable after the Termination Date, the Trustee
shall (i) certify to the Court that all conditions precedent to the Termination
Date have been satisfied and (ii) file a final accounting and serve a copy on
the TAC and the Trustor. Thereupon, the Trust shall be dissolved and the
Trustee(s) and the TAC discharged.
6.3 Amendments. This Trust Agreement may be amended, modified and/or
supplemented by unanimous vote of the Trustees only with the consent of the TAC.
6.4 Cooperation. New Keene and the Trust shall each cooperate to the
extent reasonably requested by the other in the handling of Asbestos-Related
Claims and Demands and the prosecution of the Causes of Action and generally in
the operation of the Trust for the purposes set forth herein. New Keene shall
transfer to the Trust such claim files and other documents related to the
Asbestos Related Claims as are under its custody or control, and shall use its
best efforts to make available its present or former officers, directors,
employees, agents or representatives to the extent the Trust deems such persons
necessary to appear at any trial or arbitration proceeding related to the
liquidation of the Asbestos Related Claims. To the extent the valuation of any
assets of the Trust are necessary for the tax returns of New Keene, a) the Trust
shall provide New Keene with such valuation and b) New Keene shall use such
valuation in its tax returns.
6.5 Severability. Should any provision in this Trust Agreement be
determined to be unenforceable, such determination shall in no way limit or
affect the enforceability and operative effect of any and all other provisions
of this Trust Agreement.
6.6 Notices. Notices to claimants shall be given at the address of such
claimants, or, where applicable, such claimants' Attorney of Record, in each
case as provided on such claimant Claim forms. Any notices or other
communications required or permitted hereunder shall be in writing and delivered
at the addresses designated below, or sent by telex or telecopy pursuant to the
instructions listed below, or mailed by registered or certified mail, return
receipt requested, postage prepaid, addressed as follows, or to such other
addresses as may hereafter be furnished by New Keene to the Trustees and the TAC
or by the Trustees and the TAC to New Keene in compliance with the terms hereof.
To the Trust or the Trustees:
Mr. Archie R. Dykes
Capital City Holdings Inc.
Rivergate Executive Park
907 Two Mile Parkway
Suite D-5
Goodlettsville, TN 37072
Richard A. Lippe, Esq.
Meltzer, Lippe, Goldstein, Wolf,
Schlissel & Sazer
The Chancery
190 Willis Avenue
Mineola, NY 11501
<PAGE>
27
Mr. John J. Robbins
112 Walton Heath
Williamsburg, VA 23188
With a copy to:
George A. Davidson, Esq.
Theodore V.H. Mayer, Esq.
Hughes Hubbard & Reed
One Battery Park Plaza
New York, NY 10004
Telecopier:
212-422-4726
To New Keene:
Mr. Michael T. Furry
President
Reinhold Industries, Inc.
12827 Imperial Highway
Santa Fe Springs, CA 90670-4713
To the TAC:
Stanley J. Levy, Esq.
Levy Phillips & Kongisberg
90 Park Avenue
New York, NY 10016
Charles F. Vihon, Esq.
Much Shelist Freed Denenberg
& Ament
200 North LaSalle Street
Suite 2100
Chicago, IL 60601-1095
Perry Weitz, Esq.
Weitz & Luxenberg
40 Fulton Street
New York, NY 10038
All such notices and communications shall be effective when delivered
at the designated addresses or when the telex or telecopy communication is
received at the designated addresses and confirmed by the recipient by return
telex or telecopy in conformity with the provisions hereof.
6.7 Counterparts. This Trust Agreement may be executed in any number of
counterparts, each of which shall constitute an original, but such counterparts
shall together constitute but one and the same instrument.
6.8 Successors and Assigns. The provisions of this Trust Agreement
shall be binding upon and inure to the benefit of the Trustors, the Trust, the
Trustees and the TAC and their respective successors and assigns, except that
neither the Trustor nor the Trust, nor any Trustee, nor any member of the TAC
may assign or otherwise transfer any of its or his or her rights or obligations
under this Trust Agreement except as provided for in this Trust Agreement.
<PAGE>
28
6.9 Entire Agreement; No Waiver. The entire agreement of the parties
relating to the subject matter of this Trust Agreement is contained herein, and
this Trust Agreement supersedes any prior oral or written agreements concerning
the subject matter hereof. No failure to exercise or delay in exercising any
right, power or privilege hereunder shall operate as a waiver thereof, nor shall
any single or partial exercise of any right, power or privilege hereunder
preclude any further exercise thereof of any other right, power or privilege.
The rights and remedies herein provided are cumulative and are not exclusive of
rights under law or in equity.
6.10 Headings. The headings used in this Trust Agreement are inserted
for convenience only and neither constitute a portion of this Trust Agreement
nor in any manner affect the construction of the provisions of this Trust
Agreement.
6.11 Governing Law. This Trust Agreement shall be governed by, and
construed in accordance with, the laws of the State of New York without giving
effect to principles of conflicts of law.
6.12 Dispute Resolution. Any disputes which arise under this Agreement
with respect to interpretation and implementation shall be resolved by the
Bankruptcy Court.
IN WITNESS WHEREOF, the Trustor has caused this Trust Agreement to be
executed by a duly authorized officer of representative of the Trustor and
attested by another duly authorized officer of the Trustor and the Trustees and
New Keene have each executed this Trust Agreement, all as of the day and year
first above written.
Keene Corporation
By: /s/ Timothy E. Coyne
----------------------------------------
Name: Timothy E. Coyne
Attest:
By: /s/ Norman W. Weinstock
----------------------------------------
Name: Norman W. Weinstock
/s/ Archie R. Dykes , as Trustee
-------------------------------------------
Archie R. Dykes
<PAGE>
29
/s/ Richard A. Lippe , as Trustee
-------------------------------------------
Richard A. Lippe
/s/ John J. Robbins , as Trustee
-------------------------------------------
John J. Robbins
New Keene
By: /s/ D. M. Blakesley
----------------------------------------
Name: D.M. Blakesley
Attest: By: /s/ Michael T. Furry
---------------------------------------
Name: Michael T. Furry
30
UNITED STATES BANKRUPTCY COURT
SOUTHERN DISTRICT OF NEW YORK
- - - - - - - - - - - - - - - - - - - - - - - - - - x
In re: :
: Chapter 11
KEENE CORPORATION : Case No.: 93 B 46090 (SMB)
:
Debtor. :
:
- - - - - - - - - - - - - - - - - - - - - - - - - - x
DEBTOR'S FOURTH AMENDED PLAN OF REORGANIZATION
BERLACK, ISRAELS & LIBERMAN LLP
120 West 45th Street
New York, New York 10036
(212) 704-0100
Counsel to Keene Corporation,
Debtor and Debtor in Possession
DATED: MARCH 11, 1996
NEW YORK, NEW YORK
<PAGE>
31
TABLE OF CONTENTS
Page
ARTICLE I
DEFINITIONS
1.1 Defined Terms.......................................................1
1.2 Other Terms.........................................................15
ARTICLE II
PROVISION FOR TREATMENT OF ADMINISTRATIVE EXPENSE CLAIMS
2.1 Administrative Expense Claims.......................................15
ARTICLE III
PROVISION FOR TREATMENT OF TAX CLAIMS
3.1 Tax Claims..........................................................16
ARTICLE IV
PROVISION FOR TREATMENT OF DEMANDS
4.1 Demands.............................................................16
ARTICLE V
CLASSIFICATION OF CLAIMS AND INTERESTS
5.1 Priority Claims.....................................................17
5.2 Secured Claims......................................................17
5.3 Unsecured Claims....................................................17
5.4 Interests...........................................................17
ARTICLE VI
IDENTIFICATION OF CLASSES OF CLAIMS AND INTERESTS NOT
IMPAIRED AND IMPAIRED BY THIS PLAN
6.1 Classes of Claims and Interests Not Impaired by this Plan...........18
6.2 Classes of Claims and Interests Impaired by this Plan and
Entitled to Vote....................................................18
6.3 Deemed Rejection of Other Interests.................................18
<PAGE>
32
ARTICLE VII
PROVISIONS FOR TREATMENT OF CLAIMS AND INTERESTS
7.1 Priority Claims (Class 1)...........................................18
7.2 Bonded Judgment Claims (Class 2A)...................................18
7.3 Secured Claims (Class 2B)...........................................19
7.4 Convenience Class Claims (Class 3)..................................19
7.5 Asbestos-Related Claims (Class 4)...................................19
7.6 Transactions Stipulation Claims (Class 5)...........................19
7.7 General Unsecured Claims (Class 6)..................................19
7.8 Common Stock Interests (Class 7)....................................19
7.9 Other Interests (Class 8)...........................................19
ARTICLE VIII
PROVISIONS OF SECURITIES TO BE ISSUED PURSUANT
TO THIS PLAN AND RELATED MATTERS
8.1 Reorganization Securities...........................................20
8.2 Provisions of New Common Stock......................................20
8.3 Description of Stock Incentive Plan.................................22
8.4 Registration Rights.................................................23
ARTICLE IX
THE CREDITORS' TRUST
9.1 Creation of the Creditors' Trust....................................24
9.2 Transfer of Property to the Creditors' Trust........................24
9.3 Assumption of Liabilities By the Creditors' Trust...................24
9.4 New Keene Line of Credit............................................24
9.5 Appointment of Trustees.............................................24
9.6 Purpose and Goals of the Creditors' Trust...........................25
9.7 Compensation to and Indemnification of the Trustees.................25
9.8 Retention of Professionals and Employees............................25
9.9 Payment of Certain Costs............................................25
9.10 Trust Advisory Committee............................................25
9.11 Certain Property to be Held in Trust by New Keene...................26
9.12 Preservation of Rights and Defenses.................................26
9.13 Asbestos-Related Claims Resolution and Distribution Procedures......26
ARTICLE X
DESCRIPTION OF THE OPERATION OF NEW KEENE
10.1 Creation of New Keene...............................................27
10.2 Management of New Keene.............................................27
10.3 Indemnification.....................................................27
10.4 New Keene Credit Facility...........................................27
10.5 Permanent Channeling Injunction.....................................28
<PAGE>
33
ARTICLE XI
ACCEPTANCE OR REJECTION OF THIS PLAN
11.1 Each Impaired Class Entitled to Vote Separately.....................28
11.2 Estimation of Class 4 Claims for Voting Purposes....................28
11.3 Acceptance by Impaired Classes of Claims............................28
11.4 Acceptance by Impaired Class of Interests...........................28
11.5 Presumed Acceptance of Plan.........................................28
11.6 Cramdown............................................................28
ARTICLE XII
CONDITIONS PRECEDENT
12.1 Conditions to Confirmation..........................................29
12.2 Conditions to Effectiveness of Plan.................................31
12.3 Waiver of Conditions................................................32
ARTICLE XIII
TREATMENT OF EXECUTORY CONTRACTS AND UNEXPIRED LEASES
13.1 Assumption/Rejection................................................32
13.2 Claims Based on Rejection of Executory Contracts or Unexpired
Leases............................................................33
ARTICLE XIV
IMPLEMENTATION OF THIS PLAN
14.1 Vesting of Property.................................................33
14.2 Cancellation of Securities, Notes or Other Instruments; Release
of Liens..........................................................33
14.3 Certificate of Incorporation and By-laws............................34
14.4 Corporate Authority.................................................34
14.5 Retiree Benefits....................................................34
14.6 Term of Existing Injunctions or Stays...............................34
ARTICLE XV
PROVISIONS GOVERNING DISTRIBUTIONS
15.1 Time of Distributions Under this Plan...............................34
15.2 Settlement Regarding Distributions..................................35
15.3 Distributions to Creditors' Trust...................................35
15.4 Record Date.........................................................35
15.5 Manner of Payments Under This Plan..................................35
15.6 Rounding............................................................35
15.7 Undeliverable Distributions; Unclaimed Property.....................35
15.8 Transmittal of Distributed Property and Notices.....................36
15.9 Full and Final Satisfaction.........................................36
15.10 No Distribution in Excess of Allowed Amount of Claim................36
15.11 Withholding Taxes...................................................36
15.12 Payment Dates.......................................................37
15.13 Setoffs.............................................................37
<PAGE>
34
ARTICLE XVI
PROCEDURE FOR RESOLVING DISPUTED CLAIMS AND DISPUTED INTERESTS
16.1 Applicability.......................................................37
16.2 Objections to and Estimation and Resolution of Claims and
Interests.........................................................37
16.3 Procedure...........................................................37
16.4 Payments and Distributions With Respect to Ultimately Allowed
Claims or Ultimately Allowed Interests............................38
16.5 Reserves for Disputed Claims and Interests..........................38
16.6 Funding of Objections Process.......................................39
ARTICLE XVII
EFFECTS OF PLAN CONFIRMATION
17.1 Discharge, Releases and Injunction..................................39
17.2 Permanent Channeling Injunction and Keene 27 Injunction.............40
17.3 No Release of Causes of Action......................................40
17.4 Exculpation.........................................................41
ARTICLE XVIII
MISCELLANEOUS PROVISIONS
18.1 Retention of Jurisdiction...........................................41
18.2 Jurisdiction as to the Permanent Channeling Injunction..............43
18.3 Binding Effect of Plan..............................................43
18.4 Withdrawal of this Plan.............................................43
18.5 Modification of this Plan...........................................43
18.6 Transfer of Documents...............................................44
18.7 Cooperation.........................................................44
18.8 Transfer of all Privilege...........................................44
18.9 Confidentiality.....................................................44
18.10 Tax Provision.......................................................44
18.11 Notices.............................................................44
18.12 Dissolution and Termination of Authority............................45
18.13 Headings............................................................45
18.14 Severability........................................................46
18.15 Entire Agreement....................................................46
<PAGE>
35
LIST OF EXHIBITS
Page
Amended and Restated Certificate of Incorporation............................A
Amended and Restated By-laws.................................................B
Certificate of Merger........................................................C
Creditors' Trust Agreement...................................................D
Asbestos-Related Claims Resolution and Distribution Procedures...............E
New Keene Credit Facility....................................................F
Registration Rights Agreement................................................G
Share Authorization Agreement................................................H
Stock Incentive Plan.........................................................I
<PAGE>
36
Keene Corporation, Debtor and Debtor in Possession in the
above-captioned Chapter 11 case, proposes the following Fourth Amended Plan of
Reorganization pursuant to section 1121(a) of title 11 of the United States
Code.
ARTICLE I
DEFINITIONS
1.1 Defined Terms. As used herein, the following terms have the
respective meanings specified below, unless the context otherwise requires.
(1) "Administrative Expense Claim" means: (i) any cost or expense
of administration of the Chapter 11 Case allowed under section 503(b)
of the Bankruptcy Code, including, without limitation, any actual and
necessary expense of preserving the Debtor's estate, Cure Claims, Fee
Claims and payments due under the Retention Program; and (ii) any fees
or charges assessed against the Debtor's estate under section 1930 of
chapter 123 of title 28 of the United States Code.
(2) "Advisory Board" means, collectively, those individuals who
previously served on the advisory board of Peregrine.
(3) "Allowed" means:
(i) with respect to any Claim, other than an Administrative
Expense Claim, an Asbestos-Related Claim or a Transactions
Stipulation Claim, proof of which was filed within the applicable
period of limitation fixed in accordance with Bankruptcy Rule
3003(c)(3) by the Bankruptcy Court, (a) as to which no objection
to the allowance thereof has been interposed within the
applicable period of limitation fixed by the Plan, the Bankruptcy
Code, the Bankruptcy Rules or a Final Order of the Bankruptcy
Court, such Claim to the extent asserted in the proof of such
Claim, or (b) as to which an objection has been interposed, such
Claim to the extent that it has been allowed in whole or in part
by a Final Order of the Bankruptcy Court;
(ii) with respect to any Claim, other than an Administrative
Expense Claim, an Asbestos-Related Claim or a Transactions
Stipulation Claim, as to which no proof of claim was filed within
the applicable period of limitation fixed by the Plan, the
Bankruptcy Code, the Bankruptcy Rules, or a Final Order of the
Bankruptcy Court, such Claim to the extent that it has been
listed by the Debtor in its Schedules as liquidated in amount and
not disputed or contingent;
(iii) with respect to any Claim that is asserted to
constitute an Administrative Expense Claim (a) that represents an
actual or necessary expense of preserving the estate or operating
the business of the Debtor, any such Claim to the extent that the
Debtor, with the consent of the Committee and the Legal
Representative and, after the Effective Date, New Keene, with the
consent of the Creditors' Trust, determines it to constitute an
Administrative Expense Claim, (b) other than with respect to a
Claim of a professional person employed under section 327 or 1103
of the Bankruptcy Code that is required to apply to the
Bankruptcy Court for the allowance of compensation and
reimbursement of expenses pursuant to section 330 of the
Bankruptcy Code, that the Debtor, the Committee or the Legal
<PAGE>
37
Representative or, after the Effective Date, New Keene and the
Creditors' Trust, do not believe constitutes an Administrative
Expense Claim, any such Claim to the extent it is allowed in
whole or in part by a Final Order of the Bankruptcy Court and
only to the extent that such allowed portion is deemed, pursuant
to a Final Order of the Bankruptcy Court, to constitute a cost or
expense of administration under sections 503(b) and 507(a)(1) of
the Bankruptcy Code, or (c) that represents a Claim of a
professional person employed under section 327 or 1103 of the
Bankruptcy Code that is required to apply to the Bankruptcy Court
for the allowance of compensation and reimbursement of expenses
pursuant to section 330 of the Bankruptcy Code, such Claim to the
extent it is allowed by a Final Order of the Bankruptcy Court
under section 330 of the Bankruptcy Code;
(iv) with respect to any Asbestos-Related Claim, such Claim
to the extent that it is allowed in accordance with the
procedures established pursuant to the Creditors' Trust
Documents, including the Asbestos-Related Claims Resolution and
Distribution Procedures implemented in accordance therewith;
(v) with respect to any Transactions Stipulation Claim, such
Claim to the extent that it is allowed in accordance with the
procedures contemplated by the Transactions Stipulation; and
(vi) with respect to any Common Stock Interest or Other
Interest, such Interest to the extent that it is listed on (A)
the list of equity security holders filed pursuant to Bankruptcy
Rule 1007(a)(3) or (B) to the extent such holder shall be
identified on the transfer records of the Debtor as of the Record
Date.
(4) "Allowed Amount" means the lesser of (a) the dollar amount of
an Allowed Claim or (b) the Estimated Amount of such Claim. Unless
otherwise specified herein or by Final Order of the Bankruptcy Court,
the Allowed Amount of an Allowed Claim shall not include interest
accruing on such Allowed Claim from and after the Petition Date.
(5) "Amended and Restated By-laws" means the amended and restated
by-laws of New Keene, substantially in the form attached hereto as
Exhibit B and as may be amended from time to time according to its
terms.
(6) "Amended and Restated Certificate of Incorporation" means the
amended and restated certificate of incorporation of New Keene,
substantially in the form attached hereto as Exhibit A and as may be
amended from time to time according to its terms.
(7) "Appeal Rights" means, with respect to the Bonded Judgment
Claims, the right to appeal or otherwise challenge the finality of any
judgment rendered prior to the Petition Date and any refund,
revestiture or other payment rights which may accrue upon such
successful appeal or other challenge.
(8) "Asbestos Claimant" means any Entity holding an
Asbestos-Related Claim.
<PAGE>
38
(9) "Asbestos In Buildings Claims" means those Claims against the
Debtor, whether in the nature of or sounding in tort, contract,
warranty or any other theory of law, equity or admiralty for, relating
to or arising by reason of, directly or indirectly, damages arising
from the presence in buildings or other structures of asbestos or
asbestos containing products manufactured, sold, supplied, produced,
distributed, or in any way marketed by Keene or any of its current or
former subsidiaries or affiliates (or another person, firm, corporation
or other Entity for which the Debtor is or may be liable), including
but not limited to abatement costs, diminution of value, environmental
damage, economic loss and all Claims, debts, obligations or liabilities
for compensatory damages (such as proximate, consequential, general or
special) and punitive damages.
(10) "Asbestos-Related Building Contribution Claims" means those
claims for contribution, reimbursement, indemnity or subrogation (as
those terms may be defined pursuant to the law of the relevant
jurisdiction) that are: (a) held by Entities (i) who have been or may
be defendants or respondents in an action or proceeding seeking damages
for Asbestos In Buildings Claims or (ii) seeking reimbursement or
payment of settlements paid by or on behalf of codefendants or
litigation or defense costs, including without limitation legal fees,
incurred in connection with litigation involving Asbestos In Buildings
Claims; and (b) asserted against the Debtor for (x) reimbursement of
all or any portion of any damages any such Entity has paid or may pay
to the Entity asserting such Asbestos In Buildings Claims or (y)
reimbursement of related litigation or defense costs.
(11) "Asbestos-Related Claims" means Asbestos-Related Personal
Injury Claims, Asbestos In Buildings Claims, Asbestos-Related Personal
Injury Contribution Claims and Asbestos-Related Building Contribution
Claims.
(12) "Asbestos-Related Claims Resolution and Distribution
Procedures" means those dispute, claims resolution and distribution
procedures to be implemented by the Trustees pursuant to the terms and
conditions of this Plan and the Creditors' Trust Documents, to
liquidate, determine and administer claims of and distributions to
Asbestos Claimants and Future Claimants, substantially in the form
attached hereto as Exhibit E and as may be amended from time to time
according to its terms.
(13) "Asbestos-Related Personal Injury Claims" means those Claims
against the Debtor, whether in the nature of or sounding in tort,
contract, warranty or any other theory of law, equity or admiralty for,
relating to or arising by reason of, directly or indirectly, physical,
emotional or other personal injuries or other damages caused, or
allegedly caused, directly or indirectly, by the presence of, or
exposure to, asbestos or asbestos-containing products manufactured,
sold, supplied, produced, distributed or in any way marketed and
arising or allegedly arising, directly or indirectly, from acts or
omissions of Keene or any of its current or former subsidiaries or
affiliates (or another person, firm, corporation or other Entity for or
with which Keene is or may be liable), including but not limited to all
Claims, debts, obligations or liabilities for compensatory damages
(such as loss of consortium, wrongful death, survivorship, proximate,
consequential, general and special damages) and punitive damages and
any portion of a Bonded Judgment Claim that exceeds the value of the
supersedeas bond or funded escrow amount regarding such Claim.
<PAGE>
39
(14) "Asbestos-Related Personal Injury Contribution Claims" means
those Claims for contribution, reimbursement, indemnity or subrogation
(as those terms may be defined pursuant to the law of the relevant
jurisdiction) that are: (a) held by Entities (i) who have been or may
be defendants or respondents in an action or proceeding seeking damages
for Asbestos-Related Personal Injury Claims or (ii) seeking
reimbursement or payment of settlements paid by or on behalf of
codefendants or litigation or defense costs, including without
limitation legal fees, incurred in connection with litigation involving
Asbestos-Related Personal Injury Claims; and (b) asserted against the
Debtor for (x) reimbursement of all or any portion of any damages any
such Entity has paid or may pay to the Entities asserting such
Asbestos-Related Personal Injury Claims or (y) reimbursement of related
litigation or defense costs.
(15) "Available Cash" means all Cash on hand and held in bank
accounts of the Debtor (except Cash held in escrow accounts or in trust
pursuant to a written agreement or order of a court or the Bankruptcy
Court) as of the Effective Date.
(16) "Bailey Lawsuit" means that certain adversary proceeding,
bearing Adv. Proc. No. 95-1575A, pending in the Bankruptcy Court and
commenced by the Committee by complaint dated December 1, 1995 (as such
complaint may be amended from time to time).
(17) "Bairnco NOL Action" means that certain adversary
proceeding, bearing Adv. Proc. No. 94-8843A, pending in the Bankruptcy
Court and commenced by the Debtor by complaint dated September 9, 1994
(as such complaint may be amended from time to time).
(18) "Bairnco NOL Stipulation" means that certain agreement
executed between Keene and Bairnco Corporation and approved by Order of
the Bankruptcy Court dated January 4, 1995 in the Bairnco NOL Action.
(19) "Ballot" means the form, distributed together with the
Disclosure Statement, to holders of Claims or Interests in classes that
are impaired and entitled to vote on this Plan, other than to holders
of Class 4 Claims, for the purpose of indicating acceptance or
rejection of this Plan and, with respect to the holders of Class 6
Claims, electing treatment as a holder of a Convenience Claim in
accordance with Section 7.7 hereof.
(20) "Bankruptcy Code" means title 11 of the United States Code,
as amended from time to time.
(21) "Bankruptcy Court" means the United States District Court
for the Southern District of New York, having jurisdiction over the
Chapter 11 Case and, to the extent of any reference made pursuant to
section 157 of title 28 of the United States Code, the unit of such
District Court constituted pursuant to section 151 of title 28 of the
United States Code.
(22) "Bankruptcy Rules" means the Federal Rules of Bankruptcy
Procedure, as amended from time to time, together with the local rules
adopted by the Bankruptcy Court, as amended from time to time.
(23) "Bonded Judgment Claims" means those Claims against the
Debtor arising by virtue of a judgment rendered prior to the Petition
Date in connection with which the holder thereof became the beneficiary
of a supersedeas bond or funded escrow account; provided, however, that
<PAGE>
40
the amount of any such Bonded Judgment Claim in excess of the amount of
the related supersedeas bond or in the funded escrow account shall be
an Asbestos-Related Personal Injury Claim or an Asbestos In Buildings
Claim.
(24) "Business Day" means any day other than a Saturday, Sunday
or "legal holiday," as such term is defined in Bankruptcy Rule 9006(a).
(25) "Cash" means cash, cash equivalents and other readily
marketable securities or instruments, including, without limitation,
readily marketable direct obligations of the United States of America,
certificates of deposit issued by banks and commercial paper of any
entity, including interest accrued or earned thereon.
(26) "Causes of Action" means any and all of the Debtor's
actions, claims, rights, suits and causes of action (and all rights
relating thereto, including any tolling agreements), whether known or
unknown, in law, equity or otherwise, including, without limitation:
(i) the Debtor's claims arising pursuant to sections 510, 542, 544,
545, 547, 548, 549, 550, 551, 552 and 553 of the Bankruptcy Code or
state, non-bankruptcy federal and other applicable law; (ii) the
Bairnco NOL Action; (iii) the Bairnco NOL Stipulation and the rights
thereunder; (iv) the Transactions Lawsuit (subject to the terms and
conditions of the Transactions Stipulation); (v) the Bailey Lawsuit;
(vi) the Insurance Actions; (vii) the Co-Defendant Actions; (viii) the
Appeal Rights; (ix) the Rights to Payment and (x) the benefits of the
continuation of the Coleman Injunction consistent with the Transactions
Stipulation.
(27) "Certificate of Merger" means the Certificate of Merger
referred to in Section 10.1 hereof, substantially in the form attached
hereto as Exhibit C.
(28) "Chapter 11 Case" means Case Number 93 B 46090(SMB),
concerning the Debtor.
(29) "Claim" means a claim, as that term is defined in section
101(5) of the Bankruptcy Code, against the Debtor.
(30) "Class A New Common Stock" means the 1,480,000 shares of
Class A New Common Stock, par value $.01 per share.
(31) "Class B New Common Stock" means the 1,020,000 shares of
Class B New Common Stock, par value $.01 per share.
(32) "Class 4 Special Ballot" means the form, distributed
together with the Disclosure Statement, to holders of Class 4A and 4B
Claims, for the purpose of indicating acceptance or rejection of this
Plan.
(33) "Class 7 Equity Distribution" means 980,000 shares of Class
A New Common Stock.
(34) "Co-Defendant Actions" means any claims or causes of action
that the Debtor has or may have against actual or potential
co-defendants arising from or relating to any prior, pending or
threatened asbestos-related litigation or settlement, including,
without limitation, the Manville Trust Claim.
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41
(35) "Coleman Injunction" means the preliminary injunction issued
by the Bankruptcy Court by Memorandum Decision dated March 3, 1994 and
Amended Order dated March 11, 1994, in Keene v. Coleman, Adv. Proc. No.
94-8015A.
(36) "Committee" means the Official Committee of Unsecured
Creditors appointed in the Chapter 11 Case by the United States Trustee
for the Southern District of New York on January 12, 1994, as the
membership of such committee may be amended from time to time.
(37) "Common Stock Interest" means any equity interest in the
Debtor represented by shares of Old Common Stock and any Claim against
the Debtor arising from rescission of a purchase or sale of a security
of the Debtor or of an affiliate of the Debtor, for damages arising
from the purchase or sale of such a security, or for reimbursement or
contribution allowed under section 502 of the Bankruptcy Code on
account of such a Claim.
(38) "Compensation Estimate" means a written good faith estimate,
to be filed on or before three (3) calendar days before the first date
set for the hearing on the confirmation of the Plan, of the maximum
amount of compensation and reimbursement of expenses to be requested
for any period prior to the Effective Date, including, without
limitation, any compensation for substantial contribution in the
Chapter 11 Case and for any fees or premiums in addition to normal
hourly charges or quoted fees.
(39) "Confirmation Date" means the date upon which the
Confirmation Order shall be entered on the docket maintained by the
Clerk of the Bankruptcy Court.
(40) "Confirmation Order" means the order of the Bankruptcy Court
confirming this Plan.
(41) "Consultants" means, collectively, Richard A. Lippe, Archie
R. Dykes and John J. Robbins, and any successors thereto.
(42) "Convenience Claim" means any one General Unsecured Claim,
or the aggregate of the General Unsecured Claims held by any one
Entity, in an amount of $1,000 or less or which is voluntarily reduced
to $1,000 by election of the holder thereof pursuant to such holder's
Ballot.
(43) "Corporate Transactions Defendants" means Transactions
Lawsuit Defendants Bairnco Corporation and its wholly-owned
subsidiaries, Kasco Corporation, Shielding Systems Corporation and
Arlon, Inc. and Transactions Lawsuit Defendants Kaydon Corporation and
The Genlyte Group Incorporated.
(44) "Creditors' Trust" means the trust established pursuant to
the Creditors' Trust Agreement in accordance with the terms of Section
9.1 hereof.
(45) "Creditors' Trust Agreement" means the agreement between the
Debtor, as Trustor, and the Trustees establishing the Creditors' Trust
and all exhibits thereto, substantially in the form attached hereto as
Exhibit D and as may be amended from time to time according to its
terms.
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42
(46) "Creditors' Trust Cash Distribution" means all Available
Cash and any amounts payable to the Creditors' Trust pursuant to
Sections 15.7(b), 16.4 and 16.5(b) hereof, less (i) the aggregate
amount of all Plan Payments, (ii) the aggregate amount of all Plan
Estimates and (iii) the reasonable costs and expenses associated with
the making of the Plan Payments and the prosecution of objections to
Claims and Interests.
(47) "Creditors' Trust Distribution" means all of the property of
the estate remaining after (i) payment of the Plan Payments, and (ii)
reservations for the Plan Estimates, including, without limitation, the
Creditors' Trust Cash Distribution, the Creditors' Trust Equity
Distribution, the Causes of Action, and the rights under the
Registration Rights Agreement and the Share Authorization Agreement;
provided, however, that the Creditors' Trust Distribution specifically
excludes the distribution to holders of Class 7 Common Stock Interests,
the Plan Payments and the Plan Estimates and the reasonable costs and
expenses associated with the making of the Plan Payments and the
prosecution of objections to Claims and Interests; provided, further,
however, that the Creditors' Trust Distribution shall include any
amounts subsequently payable to the Creditors' Trust pursuant to
Sections 15.7(b), 16.4 and 16.5(b) hereof.
(48) "Creditors' Trust Documents" means the documents
establishing and governing the terms and conditions for the operation
and administration of the Creditors' Trust including, but not limited
to, the Creditors' Trust Agreement, the Asbestos-Related Claims
Resolution and Distribution Procedures and all exhibits to each such
document, substantially in the forms attached hereto as Exhibits D and
E and as such documents may be amended from time to time according to
their terms.
(49) "Creditors' Trust Equity Distribution" means 1,020,000
shares of Class B New Common Stock.
(50) "Cure Claim" means a Claim by a party to an executory
contract or unexpired lease of the Debtor for the costs of curing any
defaults under any such contract or lease that is to be assumed and
assigned by the Debtor, pursuant to section 365(b) of the Bankruptcy
Code.
(51) "Debtor" means Keene Corporation, a Delaware corporation.
(52) "Demand" means a demand for payment, present or future, that
was not a Claim during the Chapter 11 Case, arises out of the same or
similar conduct or events that gave rise to the Asbestos-Related Claims
and is to be paid by the Creditors' Trust.
(53) "Disclosure Statement" means the Second Amended Disclosure
Statement describing this Plan and consistent with the Transactions
Stipulation, prepared in accordance with section 1125 of the Bankruptcy
Code and approved by order of the Bankruptcy Court, as the same may be
amended or modified from time to time.
(54) "Disputed" means, with respect to any Claim or Interest
other than a Bonded Judgment Claim, an Asbestos In Buildings Claim, an
Asbestos-Related Personal Injury Claim or a Transactions Stipulation
Claim, any Claim or Interest that is not an Allowed Claim or Allowed
Interest.
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43
(55) "Disputed Claims Reserve" has the meaning set forth in
Section 16.5(a) hereof.
(56) "Effective Date" means the date which is the first Business
Day on which all conditions to the effectiveness of this Plan shall
have been satisfied or waived.
(57) "Entity" means any individual, corporation, partnership,
joint venture, association, joint stock company, limited liability
company, estate, entity, trust, trustee, unincorporated organization,
government, governmental unit (as defined in section 101(27) of the
Bankruptcy Code), agency or political subdivision thereof, the United
States Trustee or any other entity.
(58) "ERISA" means the Employee Retirement Income Security Act of
1974, as amended from time to time.
(59) "Estimated Amount" means the estimated dollar amount of an
unliquidated Claim, Disputed Claim or contingent Claim pursuant to
section 502(c) of the Bankruptcy Code.
(60) "Fee Claim" means any Administrative Claim resulting from
the rendering of professional services and related disbursements under
section 503(b)(2)-(4) of the Bankruptcy Code.
(61) "Final Order" means an order, ruling or judgment that is no
longer subject to review, reversal, modification or amendment by appeal
or writ of certiorari.
(62) "Future Claimant" means any Entity who is or becomes the
holder of a Demand.
(63) "General Unsecured Claim" means any Claim that is not an
Administrative Expense Claim, a Tax Claim, a Priority Claim, a Bonded
Judgment Claim, a Secured Claim, a Convenience Claim, an
Asbestos-Related Claim, or a Transactions Stipulation Claim, but
includes any portion of a Secured Claim (other than a Bonded Judgment
Claim) that exceeds the value of the property securing such Claim.
(64) "Indemnity Payments" means those payments made by Keene on
or about December 2, 1993 to the law firms of Abowitz, Welch & Rhodes,
P.C. and Peabody & Arnold.
(65) "Insurance Actions" means claims and causes of action of the
Debtor against various insurers or insurance guaranty funds, including,
without limitation, those claims asserted by Keene in the Keene IV
Action and the PIGA Action.
(66) "Interest" means any Common Stock Interest or Other
Interest.
(67) "Keene" means the Debtor.
(68) "Keene IV Action" means that certain action bearing Civil
Action No. 04454-85, pending in the Superior Court for the District of
Columbia.
(69) "Keene 27 Action" means that certain adversary proceeding
bearing Adv. Proc. No. 94-8393A, pending in the Bankruptcy Court and
commenced by the Debtor by complaint dated June 3, 1994.
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44
(70) "Keene 27 Injunction" means an order of the Bankruptcy Court
permanently and forever staying, restraining and enjoining any
defendant in the Keene 27 Action from commencing or continuing any
action or other proceeding of any kind with respect to any claim,
counter-claim or cause of action which was or could have been asserted
in or related directly or indirectly to the preparation, dissemination,
discussion of, filing and/or prosecution of the Keene 27 Action.
(71) "Legal Representative" means Matthew Gluck, Esq., appointed
by Order of the Bankruptcy Court dated June 21, 1994, and any successor
thereto.
(73) "Manville Trust Claim" means that claim, asserted by the
Debtor on behalf of the estate, against the co-defendant class
settlement established in the class action captioned Findley v. Falise
(In re Joint Eastern and Southern District Asbestos Litigation) C.A.
90-3973 (E.D.N.Y.), CA 90-7518 (S.D.N.Y.) prosecuted against the
Manville Personal Injury Settlement Trust.
(74) "Merger" means the merger of Reinhold with and into the
Debtor on the Effective Date pursuant to the Certificate of Merger.
(75) "MIC Program" means the Debtor's management incentive
compensation program and the payments made thereunder for the years
1993 and 1994.
(76) "New Common Stock" means the 2,500,000 shares of common
stock of New Keene, of which 1,480,000 shares shall be designated as
Class A and 1,020,000 shares shall be designated as Class B.
(77) "New Keene" means the reorganized Debtor, which shall be
known as Reinhold Industries, Inc., as the renamed surviving entity of
the Merger.
(78) "New Keene Credit Facility" means that certain credit
facility between the Creditors' Trust and New Keene, substantially in
the form attached hereto as Exhibit F and as may be amended from time
to time according to its terms.
(79) "1992 Employee Retention Program" means the employee
retention program established by Keene in October of 1992.
(80) "Old Common Stock" means the shares of common stock of the
Debtor, par value $0.0001 per share.
(81) "Other Interest" means any equity interest in the Debtor,
other than as represented by Old Common Stock, including, without
limitation, any rights granted pursuant to the Rights Agreement dated
as of June 1990 between Keene Corporation and Continental Bank, N.A.,
as rights agent, or any other options, warrants, calls, subscriptions
or other similar rights or other agreements, commitments or outstanding
securities obligating the Debtor to issue, transfer or sell any shares
of capital stock of the Debtor.
(82) "PBGC" means the Pension Benefit Guaranty Corporation.
(83) "Pension Plan" means the retirement plan of Keene, dated
January 1, 1991, which merged the five then existing Keene pension
plans and, as such, covers the employees of Reinhold.
(84) "Peregrine" means Peregrine Solutions, a division of Keene.
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(85) "Permanent Channeling Injunction" means an order or orders
of the Bankruptcy Court or the District Court permanently and forever
staying, restraining, and enjoining an Entity from taking any action
for the purpose of, directly or indirectly, collecting, recovering, or
receiving payment of, on, or with respect to any Asbestos-Related Claim
or Demand (other than actions brought to enforce any right or
obligation under the Plan, any Exhibits to the Plan, or any other
agreement or instrument between the Debtor or New Keene and the
Creditors' Trust, which actions shall be in conformity and compliance
with the provisions hereof), including:
(a) commencing, conducting, or continuing in any manner,
directly or indirectly, any suit, action, or other proceeding
(including, without express or implied limitation, any thereof in a
judicial, arbitral, administrative, or other forum) against or
affecting any Protected Party or any property or interests in property
of any Protected Party;
(b) enforcing, levying, attaching (including, without
express or implied limitation, any prejudgment attachment), collecting,
or otherwise recovering by any means or in any manner, whether directly
or indirectly, any judgment, award, decree, or other order against any
Protected Party or any property or interests in property of any
Protected Party;
(c) creating, perfecting, or otherwise enforcing in any
manner, directly or indirectly, any encumbrance against any Protected
Party or any property or interests in property of any Protected Party;
(d) setting off, seeking reimbursement of, contribution
from, or subrogation against, or otherwise recouping in any manner,
directly or indirectly, any amount against any liability owed to any
Protected Party or any property or interests in property of any
Protected Party; and
(e) proceeding in any manner in any place with regard to any
matter that is subject to resolution pursuant to the Creditors' Trust,
except in conformity and compliance therewith.
(86) "Petition Date" means December 3, 1993.
(87) "PIGA Action" means that certain action bearing Civil Action
No. 93-13525, pending in the Court of Common Pleas, Montgomery County,
Pennsylvania.
(88) "Plan" means this Fourth Amended Plan of Reorganization of
the Debtor consistent with the Transactions Stipulation, which
supersedes any prior plan of reorganization filed by the Debtor, as the
same may be amended or modified from time to time.
(89) "Plan Estimates" means the aggregate amount of all payments
to be set aside (i) in the Disputed Claims Reserve and (ii) on account
of all Compensation Estimates.
(90) "Plan Examiner" means the Honorable William H. Webster,
appointed by the United States Trustee, which appointment was approved
by Order of the Bankruptcy Court dated January 6, 1995, and any
successor thereto.
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46
(91) "Plan Payments" means those payments to be made by the
Debtor pursuant to the terms of this Plan to holders of Allowed
Administrative Expense Claims, Allowed Tax Claims, Allowed Priority
Claims, Allowed Secured Claims, Allowed Convenience Claims and Allowed
General Unsecured Claims.
(92) "Priority Claim" means any Claim, other than any
Administrative Expense Claim or any Tax Claim, which is entitled to
priority in right of payment pursuant to section 507(a) of the
Bankruptcy Code.
(93) "Protected Party" means any of the following parties:
(a) the Debtor;
(b) New Keene;
(c) any Entity that, pursuant to the Plan or after the
Effective Date, becomes a direct or indirect transferee of, or
successor to, any assets of the Debtor, New Keene, or the Creditors'
Trust (but only to the extent that liability is asserted to exist by
reason of it becoming such a transferee or successor);
(d) any Entity that, pursuant to the Plan or after the
Effective Date, makes a loan to New Keene or the Creditors' Trust or to
a successor to, or transferee of, any assets of the Debtor, New Keene
or the Creditors' Trust (but only to the extent that liability is
asserted to exist by reason of such Entity becoming such a lender or to
the extent any pledge of assets made in connection with such a loan is
sought to be upset or impaired);
(e) any Entity to the extent he, she, or it is alleged to be
directly or indirectly liable for the conduct of, Claims against, or
Demands on, the Debtor, New Keene or the Creditors' Trust on account of
Asbestos-Related Claims or Demands, including, without limitation, the
Transactions Lawsuit Defendants, the Subscribing Individuals and the
insurance carriers and sureties of the Corporate Transactions
Defendants in such insurance carriers' and sureties' capacities as
such; or
(f) any of the Debtor's present subsidiaries and each of the
present and former officers, directors, agents, employees,
representatives, advisors, financial advisors, accountants and
attorneys;
provided, however, that notwithstanding this or any other provision of
this Plan to the contrary, an Entity's "Protected Party" status shall
not preclude the Creditors' Trust from pursuing claims against (i) the
Transactions Lawsuit Defendants in the Transactions Lawsuit; (ii)
Bairnco Corporation in the Bairnco NOL Action; (iii) Glenn W. Bailey in
the Bailey Lawsuit (as to those claims in the complaint not released
under the Plan) and (iv) any insurance carrier or surety that issued a
policy or policies of insurance to, or on behalf of, Keene or any of
the above-referenced defendants.
(94) "Record Date" means 5:00 p.m. (New York time) on the day
that the Confirmation Order is entered, or such other date and time as
may be designated in the Confirmation Order.
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(95) "Registration Rights Agreement" means that agreement between
New Keene and the Creditors' Trust, substantially in the form attached
hereto as Exhibit G and as may be amended from time to time according
to its terms.
(96) "Reinhold" means Reinhold Industries, Inc.
(97) "Released Party" means each of the Debtor, New Keene and the
Creditors' Trust or any of their respective successors or assigns, and
each of their present and former directors and officers, the Committee,
its members and representatives, the Legal Representative, the
Transactions Claims Examiner, the Plan Examiner, the Consultants, the
Transactions Lawsuit Defendants in their capacities as such, the
Subscribing Individuals and the insurance carriers and sureties of the
Corporate Transactions Defendants in such insurance carriers' and
sureties' capacities as such, and each of the professionals retained by
Order of the Bankruptcy Court by each of the Debtor, New Keene, the
Creditors' Trust, the Committee, the Legal Representative, the
Transactions Claims Examiner, the Plan Examiner, and the Consultants
(excluding those professionals retained as special counsel to, or as an
ordinary course professional of, the Debtor and the Committee);
provided, however, that notwithstanding this or any provision of this
Plan to the contrary, an Entity's "Released Party" status shall not
preclude the Creditors' Trust from pursuing claims against (i) the
Transactions Lawsuit Defendants in the Transactions Lawsuit; (ii)
Bairnco Corporation in the Bairnco NOL Action; (iii) Glenn W. Bailey in
the Bailey Lawsuit (as to those claims in the complaint not released
under the Plan); and (iv) any insurance carrier or surety that issued a
policy or policies of insurance to, or on behalf of, Keene or any of
the above-referenced defendants.
(98) "Retention Program" means the supplemental severance and
compensation program approved by the Bankruptcy Court pursuant to an
order dated June 7, 1995.
(99) "Rights to Payment" means the Debtor's right to receive
payments or distributions on account of its claim to tax refunds for
taxable years prior to the Effective Date and its assertion of the
Manville Trust Claim and claims against Midland Insurance Company and
the Integrity Insurance Company.
(100) "Schedules" means the schedules of assets and liabilities
and statements of financial affairs filed by the Debtor in accordance
with section 521 of the Bankruptcy Code and Bankruptcy Rule 1007, as
such schedules and statements may be amended or supplemented from time
to time in accordance with the Bankruptcy Code and the Bankruptcy
Rules; provided, however, that the Schedules shall not be amended after
June 1, 1995 without the consent of the Committee and the Legal
Representative unless by motion on notice to the Committee and the
Legal Representative.
(101) "Secured Claim" means any Claim, other than a Bonded
Judgment Claim, secured by a valid and unavoidable lien on or security
interest in property of the Debtor pursuant to section 506(a) of the
Bankruptcy Code, but only to the extent of the value as of the
Confirmation Date of such lien or security interest as determined by
Final Order of the Bankruptcy Court or as agreed to by the Debtor and
the holder of such Claim.
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(102) "Severance Policy" means Keene's pre-petition severance
policy entitling all employees that were terminated other than for
cause to severance pay equal to one week's pay for each year employed
by Keene.
(103) "Share Authorization Agreement" means that certain
agreement between New Keene and the Creditors' Trust, substantially in
the form attached hereto as Exhibit H and as may be amended from time
to time according to its terms.
(104) "Stock Dividends" means all Cash dividends Keene paid to
holders of Old Common Stock during the years 1991 and 1992.
(105) "Stock Incentive Plan" or "SIP" means the New Keene Stock
Incentive Plan, substantially in the form attached hereto as Exhibit I
and as may be amended from time to time according to its terms.
(106) "Subscribing Individual" means any individual who is a
signatory to the Transactions Stipulation.
(107) "Tax Claim" means a Claim of a governmental unit of the
kind specified in section 507(a)(8) of the Bankruptcy Code.
(108) "Transactions Claims Examiner" means Thomas Moers Mayer,
Jr., Esq., appointed by Orders of the Bankruptcy Court dated March 11,
1994 and April 15, 1994, and any successor thereto.
(109) "Transactions Lawsuit" means that certain adversary
proceeding bearing Adv. Proc. No. 95-9393A, pending in the Bankruptcy
Court and commenced by the Committee by complaint dated June 8, 1995
(as such complaint may be amended in accordance with the Transactions
Stipulation).
(110) "Transactions Lawsuit Defendants" means those Entities
named as defendants in the Transactions Lawsuit.
(111) "Transactions Stipulation" means that certain agreement
executed between and among Keene, the Committee, the Legal
Representative and the Transactions Stipulation Claimants, approved by
the Transactions Stipulation Order and attached as Exhibit 5 to the
Disclosure Statement.
(112) "Transactions Stipulation Claimant" means any Entity
holding a Transactions Stipulation Claim.
(113) "Transactions Stipulation Claims" means those Claims
against the Debtor asserted by the Corporate Transactions Defendants
and the Subscribing Individuals.
(114) "Transactions Stipulation Order" means the Order of the
Bankruptcy Court dated March 11, 1996, approving the Transactions
Stipulation and attached as Exhibit 6 to the Disclosure Statement.
(115) "Trust Advisory Committee" means the three advisors
initially chosen by the Committee and the Legal Representative whose
duties, obligations and compensation shall be as set forth in the
Creditors' Trust Agreement, and any successors thereto.
(116) "Trustees" means the three individuals initially selected
to act as trustees pursuant to the terms of the Creditors' Trust
Documents to administer the Creditors' Trust, and any successors
thereto.
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(117) "Ultimately Allowed Claim" or "Ultimately Allowed Interest"
means any Disputed Claim or Disputed Interest to the extent that it
becomes an Allowed Claim or Allowed Interest in accordance with Article
XVI of this Plan.
(118) "Voting Procedures Order" means the order of the Bankruptcy
Court dated March 11, 1996, approving and authorizing the voting
procedures to be employed in this Chapter 11 Case, including the Class
4 Special Ballot, attached as Exhibit 4 to the Disclosure Statement.
1.2 Other Terms. The words "herein," "hereof," "hereto," "hereunder,"
and others of similar import refer to this Plan as a whole and not to any
particular section, subsection or clause contained in this Plan, unless the
context requires otherwise. Any term used in this Plan that is not defined
herein but that is defined in the Bankruptcy Code shall have the meaning
assigned to that term in the Bankruptcy Code. In addition, the rules of
construction contained in section 102 of the Bankruptcy Code apply to the
construction of this Plan.
ARTICLE II
PROVISION FOR TREATMENT OF ADMINISTRATIVE EXPENSE CLAIMS
2.1 Administrative Expense Claims. Each holder of an Administrative
Expense Claim that the Debtor, with the consent of the Committee and the Legal
Representative or, after the Effective Date, New Keene with the consent of the
Creditors' Trust, does not dispute or which has been allowed by the Bankruptcy
Court, shall be paid in full, in Cash, on or as soon as practicable after the
Effective Date; provided, however, that Allowed Administrative Expense Claims
representing obligations incurred by the Debtor in the ordinary course of
business during the Chapter 11 Case (other than Fee Claims) shall be paid in
full by the Debtor or performed by either New Keene or the Creditors' Trust, as
the case may be, when due in the ordinary course of business and in accordance
with the terms and conditions of the particular agreements governing such
obligations, if any; provided, further, however, that Administrative Expense
Claims representing compensation or reimbursement of expenses awarded by the
Bankruptcy Court pursuant to sections 503(b)(2), 503(b)(3) or 503(b)(4) of the
Bankruptcy Code shall be reserved for by Keene in full, in Cash, in such amounts
equal to the Compensation Estimates and paid by New Keene on the date upon which
the Bankruptcy Court enters an order allowing such Administrative Expense Claim
and, to the extent that such reserve is insufficient to satisfy an Allowed Fee
Claim, the deficiency shall be paid by the Creditors' Trust; provided, however,
that the Debtor shall also reserve sufficient funds to satisfy any and all
Administrative Expense Claims that may become Ultimately Allowed Claims.
ARTICLE III
PROVISION FOR TREATMENT OF TAX CLAIMS
3.1 Tax Claims. Each holder of an Allowed Tax Claim shall be paid the
full amount of its Allowed Tax Claim, in Cash, on or as soon as practicable
after the Effective Date.
ARTICLE IV
PROVISION FOR TREATMENT OF DEMANDS
4.1 Demands. On the Effective Date, Demands shall be fully satisfied as
against the Debtor by virtue of the distribution of the Creditors' Trust
Distribution to the Creditors' Trust for the benefit of all holders of
Asbestos-Related Claims and Demands pursuant to the terms and conditions of the
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Creditors' Trust Documents. Each holder of a Demand shall have its Demand
channeled to the Creditors' Trust and such Demand shall be assertable
exclusively against the Creditors' Trust in accordance with the provisions set
forth in the Creditors' Trust Documents.
ARTICLE V
CLASSIFICATION OF CLAIMS AND INTERESTS
Pursuant to section 1122 of the Bankruptcy Code, set forth below is a
designation of classes of Claims against and Interests in the Debtor. A Claim or
Interest is classified in a particular class only to the extent that the Claim
or Interest qualifies within the description of the class and is classified in a
different class to the extent the Claim or Interest qualifies within the
description of that different class. In accordance with sections 1123(a)(1) and
524(g)(5) of the Bankruptcy Code, Administrative Expense Claims, Tax Claims and
Demands are not classified.
5.1 Priority Claims.
Class 1. Class 1 consists of all Allowed Priority Claims.
5.2 Secured Claims.
Class 2. Class 2 consists of the following Claims:
Class 2A. Class 2A consists of all Allowed Bonded
Judgment Claims.
Class 2B. Class 2B consists of all Allowed Secured
Claims, each of which will be within a separate subclass with each
subclass to be deemed a separate Class for all purposes.
5.3 Unsecured Claims.
Class 3. Class 3 consists of all Allowed Convenience Claims.
Class 4. Class 4 consists of the following Asbestos-Related Claims:
Class 4A--Asbestos-Related Personal Injury Claims and
Asbestos-Related Personal Injury Contribution Claims.
Class 4B--Asbestos In Buildings Claims and
Asbestos-Related Building Contribution Claims.
Class 5. Class 5 consists of all Allowed Transactions Stipulation
Claims.
Class 6. Class 6 consists of all Allowed General Unsecured Claims.
5.4 Interests.
Class 7. Class 7 consists of all Allowed Common Stock Interests in
the Debtor.
Class 8. Class 8 consists of all Other Interests.
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51
ARTICLE VI
IDENTIFICATION OF CLASSES OF CLAIMS AND INTERESTS
NOT IMPAIRED AND IMPAIRED BY THIS PLAN
6.1 Classes of Claims and Interests Not Impaired by this Plan. Priority
Claims (Class 1), Bonded Judgment Claims (Class 2A), Secured Claims (Class 2B),
Convenience Claims (Class 3) and Transactions Stipulation Claims (Class 5) are
not impaired by this Plan. Pursuant to section 1126(f) of the Bankruptcy Code,
the holders of such Claims are conclusively presumed to have accepted this Plan,
and the votes of such holders shall not be solicited.
6.2 Classes of Claims and Interests Impaired by this Plan and Entitled
to Vote. Asbestos-Related Personal Injury Claims and Asbestos-Related Personal
Injury Contribution Claims (Class 4A), Asbestos In Buildings Claims and
Asbestos-Related Building Contribution Claims (Class 4B), General Unsecured
Claims (Class 6), and Common Stock Interests (Class 7) are impaired by this Plan
and the holders of such Claims and Interests are entitled to vote to accept or
reject this Plan.
6.3 Deemed Rejection of Other Interests. Other Interests (Class 8) are
impaired by this Plan. Pursuant to section 1126(g) of the Bankruptcy Code, the
holders of such Interests are deemed to have rejected this Plan, and the votes
of such holders shall not be solicited.
ARTICLE VII
PROVISIONS FOR TREATMENT OF CLAIMS AND INTERESTS
Priority Claims
7.1 Priority Claims (Class 1). Class 1 Claims are not impaired. On the
Effective Date, each holder of an Allowed Priority Claim shall receive the full
amount of its Allowed Priority Claim in Cash.
Secured Claims
7.2 Bonded Judgment Claims (Class 2A). Class 2A Claims are not
impaired. Each holder of an Allowed Bonded Judgment Claim shall, subject to the
Appeal Rights, be entitled to payment from the proceeds of the supersedeas bond
or escrow account securing its Claim.
7.3 Secured Claims (Class 2B). Class 2B Claims are not impaired. With
respect to each Allowed Secured Claim, at the sole option of the Debtor, (a) the
legal, equitable and contractual rights of such holder of an Allowed Secured
Claim shall remain unaltered; (b) the holder of such Allowed Secured Claim shall
receive the full amount of its Allowed Secured Claim in cash on the Effective
Date; (c) the holder of such Allowed Secured Claim shall have released to it the
collateral securing its Claim; or (d) the Debtor shall provide such other
treatment that will render the Allowed Secured Claim unimpaired pursuant to
section 1124 of the Bankruptcy Code.
Unsecured Claims
7.4 Convenience Class Claims (Class 3). Class 3 Claims are not
impaired. On the Effective Date, each holder of an Allowed Convenience Claim
shall receive the full amount of its Allowed Convenience Claim, in Cash, up to
and including the amount of $1,000.
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52
7.5 Asbestos-Related Claims (Class 4). Class 4 Claims are impaired. On
the Effective Date, Asbestos-Related Claims shall be fully satisfied and
discharged as against the Debtor by virtue of the distribution of the Creditors'
Trust Distribution to the Creditors' Trust for the benefit of all holders of
Asbestos-Related Claims and Demands pursuant to the terms and conditions of the
Creditors' Trust Documents. Each holder of an Asbestos-Related Claim shall have
its Claim channeled to the Creditors' Trust and such Claim shall be assertable
exclusively against the Creditors' Trust in accordance with the procedures of
the Creditors' Trust Documents.
7.6 Transactions Stipulation Claims (Class 5). Class 5 Claims are not
impaired. On the Effective Date, Transactions Stipulation Claims shall be fully
satisfied and discharged as against the Debtor pursuant to the benefits of the
Transactions Stipulation.
7.7 General Unsecured Claims (Class 6). Class 6 Claims are impaired. On
the Effective Date, each holder of an Allowed General Unsecured Claim, unless
such holder has elected to be treated as an Allowed Convenience Claim in Class
3, shall receive such holder's pro rata share of a pool of available funds
totalling $250,000 in the aggregate.
Interests
7.8 Common Stock Interests (Class 7). Class 7 Common Stock Interests
are impaired. On the Effective Date, each holder of an Allowed Common Stock
Interest shall receive its pro rata share of the Class 7 Equity Distribution.
7.9 Other Interests (Class 8). Class 8 Other Interests are impaired. On
the Effective Date, all Other Interests shall be cancelled, annulled or
extinguished, and the holders thereof shall not be entitled to receive or retain
any property or distribution pursuant to this Plan.
ARTICLE VIII
PROVISIONS OF SECURITIES TO BE ISSUED PURSUANT TO THIS PLAN AND RELATED MATTERS
8.1 Reorganization Securities. The following is a summary of certain of
the principal terms of the New Common Stock, which shall have such rights as set
forth in the Amended and Restated Certificate of Incorporation, substantially in
the form attached hereto as Exhibit A. The following summary is qualified in its
entirety by reference to the Amended and Restated Certificate of Incorporation.
New Keene, as a successor in interest to the Debtor, will issue the New Common
Stock pursuant to section 1145 of the Bankruptcy Code.
8.2 Provisions of New Common Stock
(i) Issuer: New Keene.
(ii) Aggregate Number of 2,500,000 shares of New Common Stock,
Authorized Shares: 1,480,000 shares to be designated as
Class A New Common Stock and 1,020,000
shares to be designated as Class B New
Common Stock.
(iii) Aggregate Number of Shares to 2,000,000 shares of New Common Stock.
be Issued on Date: on the Effective Pursuant to the terms
of this Plan, the Effective Date,
980,000 shares of Class A New Common
Stock will be issued and distributed to
the holders of Class 7 Interests and
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53
1,020,000 shares of Class B New Common
Stock will be issued and distributed to
the Trustees of the Creditors' Trust.
(iv) Restriction on the Issuance Pursuant to the Share Authorization
of Additional Shares Agreement, substantially in the form
attached hereto as Exhibit H, no
additional shares of Class A New Common
Stock shall be authorized or issued
without the prior written consent of
the holder of Class B New Common Stock;
provided, however, that such consent
rights require that the Class B New
Common Stock then outstanding represent
not less than ten percent (10%) of the
aggregate number of shares of New
Common Stock then outstanding.
(v) Dividends: New Keene may declare dividends to the
holders of New Common Stock, and may
pay such dividends in Cash, property or
stock of New Keene, as such dividends
may be from time to time declared by
the Board of Directors out of the
legally available assets or funds of
New Keene.
(vi) Voting Rights of Shares to be After the Effective Date, in accordance
Issued: with the provisions of the Amended and
Restated Certificate of Incorporation
and Amended and Restated By-laws, each
share of Class A and Class B New Common
Stock shall entitle the holder thereof
to one vote on account of such share;
provided, however, that in no event
shall holders of Class A New Common
Stock or Class B New Common Stock
authorize an amendment which shall
adversely affect class voting rights
without the approval of such other
class. The Amended and Restated
Certificate of Incorporation of New
Keene shall provide for the election of
one director by holders of Class A New
Common Stock, and for the election of
two directors by the holder of Class B
New Common Stock until such time as the
Class B New Common Stock shall
represent less than twenty-five percent
(25%) (but greater than ten percent
(10%)) of the aggregate number of
shares of New Common Stock then
outstanding, in which event, the holder
of Class B New Common Stock, voting as
a class, shall be entitled to elect one
director and the holders of the Class A
New Common Stock, voting as a class,
shall be entitled to elect two
directors; provided, however, that at
such time as the Class B New Common
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54
Stock shall represent less than ten
percent (10%) of the aggregate shares
of New Common Stock then outstanding,
all the shares of Class B New Common
Stock held by the Creditors' Trust
shall convert to Class A New Common
Stock, at which time holders of Class A
New Common Stock shall be entitled to
elect all such directors.
(vii) Restrictions Applicable Class B New Common Stock may be held
Solely to Class B New only by the Creditors' Trust. Class B
Common Stock: New Common Stock shall become Class A
New Common Stock upon the earlier
occurrence of any of the following
events: (i) such Class B New Common
Stock has been sold or otherwise
transferred by the Creditors' Trust;
(ii) the total votes attributable to
all such shares of Class B New Common
Stock held by the Creditors' Trust
aggregates to less than ten percent
(10%) of the aggregate number of shares
of New Common Stock then outstanding;
or (iii) ten years from the Effective
Date.
(viii) Restrictions on Transfer of In order to preserve the Debtor's net
New Common Stock: operating losses, the Amended and
Restated Certificate of Incorporation
will provide that, unless all members
of the Board of Directors otherwise
approve, New Keene will treat as null
and void the acquisition of New Common
Stock by any person who is, or would
thereby become, a four and
three-quarters percent (4.75%)
shareholder (within the meaning of the
applicable regulations under section
382 of the Internal Revenue Code). The
New Common Stock certificates will
contain a legend setting forth this
restriction.
8.3 Description of Stock Incentive Plan. While this Plan provides for
the establishment of the SIP, all awards, vesting procedures and benefits which
may be derived thereunder shall be within the exclusive discretion of the Board
of Directors of New Keene. Until such time as the Board may grant awards
thereunder, no employee shall have any rights or entitlements to any specific
stock incentive or similar compensation. The following is a summary of the
principal terms of the SIP and is qualified in its entirety by reference to the
SIP, substantially in the form attached hereto as Exhibit I.
(i) Number of Shares Subject to
SIP: 100,000 shares of Class A New Common
Stock, with a 10,000 maximum number of
shares for any one participant as may
be specified by the Board of Directors.
(ii) Effective Date: The SIP shall be effective on the
Effective Date.
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55
(iii) Form of Awards: Awards may be granted in the form of
options, stock appreciation rights
("SAR") "phantom" stock or restricted
stock, in the discretion of the
committee (the "Compensation
Committee") of the Board of Directors
of New Keene appointed to administer
the SIP. Options may be either
incentive stock options qualifying
under section 422 of the Internal
Revenue Code or non-qualified options,
as determined by the Compensation
Committee. SARs may be granted only in
connection with a related option. The
issuance of any shares of authorized
Class A New Common Stock pursuant to
the SIP is subject to the consent of
the Creditors' Trust, pursuant to the
terms of the Share Authorization
Agreement. In the event that the
Creditors' Trust declines to consent to
the issuance of any additional shares
of Class A New Common Stock, awards
granted pursuant to the SIP may be in
the form of phantom stock or SARs
unless New Keene elects to purchase
shares of Class A New Common Stock on
the open market to satisfy SIP awards.
(iv) Eligible Employees: Any employee of New Keene or any of its
subsidiaries designated by the
Compensation Committee may be eligible
to participate in the SIP.
(v) Statutory Provisions: The SIP is designed to qualify as a
16b-3 plan under the Securities
Exchange Act of 1934 and to satisfy the
requirements of section 162(m) of the
Internal Revenue Code, relating to the
deductibility of compensation in excess
of $1,000,000 annually, and shall
contain such terms and conditions as
necessary to effectuate that design.
8.4 Registration Rights. The following is a summary of the principal
terms of the Registration Rights Agreement, and is qualified in its entirety by
reference to the Registration Rights Agreement, substantially in the form
attached hereto as Exhibit G.
(i) Issuer: New Keene
(ii) Other Party: Creditors' Trust
(iii) Conditions to Exercisability Not earlier than 2 years from the
of Rights: Effective Date. Other customary terms
and provisions shall apply.
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56
(iv) Demands: The Creditors' Trust shall have the
right to make two demands for the
registration of its Class B New Common
Stock as Class A New Common Stock;
provided, however, that in no event may
the Creditors' Trust make a demand for
the registration of securities within
twelve (12) months of any prior demand
or registration.
(v) Piggyback Rights: The Creditors' Trust shall have
unlimited piggyback rights; provided,
however, that (a) the number of shares
subject to such rights shall not exceed
the number of shares then being
registered by New Keene and (b) if the
underwriter seeks to reduce the number
of shares subject to registration, such
reduction shall be applied first
against the shares that the Creditors'
Trust seeks to register.
(vi) Expenses: New Keene will pay all registration
fees and expenses in connection with
any registration effected under the
Registration Rights Agreement,
including the cost of counsel and
accountants retained by New Keene in
connection with such registration,
except that the Creditors' Trust will
pay the fees and expenses of its own
counsel and accountants, if any, as
well as underwriters' fees and expenses
and underwriting discounts and
commissions and transfer taxes incurred
by the Creditors' Trust with respect to
its New Common Stock being registered.
ARTICLE IX
THE CREDITORS' TRUST
9.1 Creation of the Creditors' Trust. On the Effective Date, the
Creditors' Trust shall be created and established, pursuant to the terms of the
Creditors' Trust Documents, as a designated settlement fund or a qualified
settlement fund, within the meaning of section 468B of the Internal Revenue Code
and the regulations issued by the Internal Revenue Service pursuant to said
statute.
9.2 Transfer of Property to the Creditors' Trust. On the Effective
Date, the Debtor shall transfer, or cause to be transferred, to the Creditors'
Trust the Creditors' Trust Distribution.
9.3 Assumption of Liabilities By the Creditors' Trust. In consideration
of the property transferred to the Creditors' Trust pursuant to Section 9.2
hereof and in furtherance of the purpose of the Creditors' Trust (as set forth
in Section 1.2 of the Creditors' Trust Agreement, this Plan and Section
524(g)(2)(B)(i) of the Bankruptcy Code) the Creditors' Trust will assume all
liability and responsibility for all Asbestos-Related Claims, Demands and
Transactions Stipulation Claims within the meaning of Section 524(g) of the
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57
Bankruptcy Code. New Keene shall have no financial or other responsibilities for
or in connection with such Asbestos-Related Claims, Demands or Transactions
Stipulation Claims.
9.4 New Keene Line of Credit. On the Effective Date, the Creditors'
Trust and New Keene shall enter into the New Keene Credit Facility,
substantially in the form attached hereto as Exhibit F.
9.5 Appointment of Trustees. The Creditors' Trust, initially, shall be
managed by three independent Trustees, selected by the Committee and the Legal
Representative, who have no affiliation with the Debtor, are not holders of
Asbestos-Related Claims or Demands, and do not and have not personally
represented, in connection with an Asbestos-Related Claim or Demand, any Entity
who asserts or who has asserted an Asbestos-Related Claim or Demand. Each
initial Trustee shall serve for a three year term or until the earlier of such
person's death, resignation or removal. Thereafter, the initial Trustees, with
the consent of the Trust Advisory Committee, shall designate one Trustee who
shall serve as the sole Trustee until his or her (i) death or incapacity, (ii)
removal or (iii) resignation. All successor Trustees shall be appointed in
accordance with the terms and conditions contained in the Creditors' Trust
Agreement. Each Trustee shall be deemed to be (and the Confirmation Order shall
provide that such Trustee is) a "party in interest" within the meaning of
section 1109(b) of the Bankruptcy Code. On the Effective Date, the Creditors'
Trust shall be deemed the successor to the Committee with respect to any then
pending motions, contested matters, adversary proceedings or appeals to which
the Committee was a party.
9.6 Purpose and Goals of the Creditors' Trust. The purposes of the
Creditors' Trust are: (i) to assume any and all liabilities of the Debtor and
its successors in interest with respect to any and all Asbestos-Related Claims
and Demands within the meaning of section 524(g) of the Bankruptcy Code; (ii) to
use the assets and income of the Creditors' Trust to pay holders of valid
Asbestos-Related Claims and Demands in accordance with the Creditors' Trust
Agreement and the Asbestos-Related Claims Resolution and Distribution
Procedures; and (iii) to otherwise comply in all respects with the requirements
of a trust set forth in section 524(g)(2)(B)(i) of the Bankruptcy Code through
the provisions of the Creditors' Trust Agreement and the Asbestos-Related Claims
Resolution and Distribution Procedures.
9.7 Compensation to and Indemnification of the Trustees. The Trustees
shall receive compensation for their services, and shall be indemnified, in
accordance with the terms of the Creditors' Trust Agreement.
9.8 Retention of Professionals and Employees. The Creditors' Trust may
retain the services of attorneys, accountants, valuation experts, employees and
other agents necessary to assist and advise the Trustees in the performance of
their duties in accordance with the terms and provisions of the Creditors' Trust
Documents.
9.9 Payment of Certain Costs. New Keene, with the reasonable consent of
the Creditors' Trust, may retain professionals to facilitate the distribution of
Cash and other property pursuant to the Plan and to prosecute objections to
Claims and Interests. The Creditors' Trust shall be responsible for the payment
of the fees and expenses of such professionals within thirty (30) days of the
submission by such professionals of reasonably detailed invoices. The Creditors'
Trust may object to the payment of such invoices within ten days of their
submission; provided, however, that the Creditors' Trust shall remain obligated
to pay the undisputed portion of each such invoice within thirty (30) days from
the date of submission. The resolution of the disputed portion of any such
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58
invoice, if not otherwise resolved by an agreement among such professional and
the Creditors' Trust, shall be subject to the exclusive jurisdiction of the
Bankruptcy Court.
9.10 Trust Advisory Committee. The Trust Advisory Committee ("TAC")
shall consult with and advise the Trustees. Members of the Committee and their
representatives are eligible to serve as members of the TAC. The TAC shall have
such other duties and authority as set forth in the Creditors' Trust Documents.
The fees and expenses of the TAC shall be paid by the Creditors' Trust and the
Creditors' Trust shall indemnify the TAC in accordance with the terms of the
Creditors' Trust Documents. In addition, the TAC may retain the services of
attorneys, accountants, valuation experts and other professionals necessary to
the performance of its duties. The TAC shall be deemed to be (and the
Confirmation Order shall provide that the TAC is) a "party in interest" within
the meaning of section 1109(b) of the Bankruptcy Code.
9.11 Certain Property to be Held in Trust by New Keene. If and to the
extent that any property of the Debtor under applicable law or any contractual
provision cannot be effectively transferred and assigned to the Creditors'
Trust, or if New Keene shall receive any such property (and any proceeds
thereof), New Keene shall notify the Creditors' Trust immediately upon receipt
of such property and, unless directed otherwise by the Creditors' Trust, take
all reasonable actions to hold and retain such property in trust for the benefit
of the Creditors' Trust and, promptly upon receipt thereof, take such actions as
are necessary to perfect such trust; in the event the property is Cash, check or
negotiable instruments, New Keene shall deposit same in a trust account so named
for the benefit of the Creditors' Trust and, following notice, shall take only
such actions with respect to such property (and proceeds thereof) as the
Trustees reasonably may direct in writing.
9.12 Preservation of Rights and Defenses.
(a) The Creditors' Trust shall have, with respect to each
Asbestos-Related Claim or Demand, among other things, all defenses (including
but not limited to all defenses under section 502 of the Bankruptcy Code),
affirmative defenses, rights of setoff and recoupment, counterclaims and rights
of contribution, reimbursement, subrogation and indemnity (i) that the Debtor
would have had under applicable law if (x) the Chapter 11 Case had not occurred
and (y) the holder of such Asbestos-Related Claim or Demand had asserted such
Asbestos-Related Claim or Demand by initiating civil litigation against the
Debtor, and (ii) that the Debtor now has or has ever had.
(b) The rights and defenses of the Creditors' Trust with respect to the
Transactions Lawsuit and the Transactions Stipulation Claims shall be subject to
the terms and conditions of the Transactions Stipulation. The conduct of the
Transactions Lawsuit by the Creditors' Trust and the enforcement and
satisfaction by the Creditors' Trust of any judgment obtained in the
Transactions Lawsuit against any Transactions Lawsuit Defendant shall be subject
in all respects to the terms and conditions of the Transaction Stipulation. No
findings of fact or conclusions of law entered in the course of the Chapter 11
Case or any provisions or statements in this Plan, the Disclosure Statement, the
Transactions Stipulation or any orders confirming or implementing the Plan
(other than any findings of fact or conclusions of law entered by the Bankruptcy
Court in the Transactions Lawsuit or the Bairnco NOL Action) shall have any res
judicata, collateral estoppel or other similar preclusive effect in the
Transactions Lawsuit, the Bairnco NOL Action or in connection with the assertion
or prosecution of the Transactions Stipulation Claims of the Corporate
Transactions Defendants or the Subscribing Individuals or the Creditors' Trust's
assertion or pursuit of defenses or objections thereto.
9.13 Asbestos-Related Claims Resolution and Distribution Procedures.
The Creditors' Trust shall implement the Asbestos-Related Claims Resolution and
Distribution Procedures in accordance with the terms of the Creditors' Trust
Documents.
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59
ARTICLE X
DESCRIPTION OF THE OPERATION OF NEW KEENE
10.1 Creation of New Keene. On the Effective Date, Reinhold will merge
with and into Keene. The Certificate of Merger shall be filed with the Secretary
of State of the State of Delaware on the Effective Date. Pursuant to the Merger,
all of the issued and outstanding capital stock of Reinhold shall be cancelled
and Reinhold shall be merged with and into the Debtor. Keene shall be the
surviving corporation of the Merger and shall be renamed Reinhold Industries,
Inc. The authorized capital stock of New Keene shall be as set forth in Article
VIII hereof and shall be distributed as provided for elsewhere herein.
10.2 Management of New Keene. On and after the Effective Date, the
management, control and operation of New Keene will become the general
responsibility of the Board of Directors of New Keene. Upon consummation of the
Plan, the Amended and Restated Certificate of Incorporation and the Amended and
Restated By-laws of New Keene will provide that the Board of Directors of New
Keene shall consist of three (3) directors. One (1) of such directors shall be
nominated by Keene's existing Board of Directors, and such nominee shall be the
present Chief Executive Officer of Reinhold. The other two (2) directors shall
be selected jointly by the Committee and the Legal Representative; provided,
however, that one of such nominees shall not represent or be retained on behalf
of any creditor or holder of a Demand.
On the Effective Date, it is expected that the executive officers of
New Keene (the "Executive Officers") shall be as designated in the Disclosure
Statement and that their employment shall be governed by management contracts.
10.3 Indemnification. The Amended and Restated Certificate of
Incorporation and Amended and Restated By-laws of New Keene provide for
indemnification of New Keene's directors and officers to the fullest extent
permitted by applicable law now or hereafter in effect.
10.4 New Keene Credit Facility. Pursuant to the terms of the New Keene
Credit Facility, New Keene shall have the ability to draw on a $1.5 million line
of credit extended by the Creditors' Trust. The New Keene Credit Facility
provides that New Keene may make draws on the line of credit up to a maximum
amount of $1.5 million at any time over a two year period following the
Effective Date, and requires that New Keene's obligations thereunder be paid in
full on the third anniversary of the Effective Date.
10.5 Permanent Channeling Injunction. New Keene shall have the benefits
of the Permanent Channeling Injunction, as more fully set forth in Article XVII
hereof.
ARTICLE XI
ACCEPTANCE OR REJECTION OF THIS PLAN
11.1 Each Impaired Class Entitled to Vote Separately. Except as
otherwise provided by this Plan, the holders of Claims or Interests in each
impaired class of Claims or Interests, other than the holders of Other Interests
in Class 8, shall be entitled to vote separately as a class to accept or reject
this Plan. Class 8 is deemed to have rejected the Plan pursuant to section
1126(g) of the Bankruptcy Code.
11.2 Estimation of Class 4 Claims for Voting Purposes. Pursuant to the
Voting Procedures Order, the Claims of holders of Class 4A and 4B Claims shall
be Allowed, for voting purposes only, on the terms and conditions specified
therein.
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11.3 Acceptance by Impaired Classes of Claims. Pursuant to section
1126(c) of the Bankruptcy Code, an impaired class of Claims, including without
limitation Class 4 and Class 6 Claims, shall have accepted this Plan if (1) the
holders (other than Claims held by any holder designated pursuant to section
1126(e) of the Bankruptcy Code) of at least two-thirds (2/3) in dollar amount of
the Allowed Claims actually voting in such class have voted to accept this Plan
and (2) more than one-half (1/2) in number (other than Claims held by any holder
designated pursuant to section 1126(e) of the Bankruptcy Code) of such Allowed
Claims actually voting in such class have voted to accept this Plan.
11.4 Acceptance by Impaired Class of Interests. Pursuant to section
1126(d) of the Bankruptcy Code, an impaired class of Interests shall have
accepted this Plan if the holders (other than Interests held by any holder
designated pursuant to section 1126(e) of the Bankruptcy Code) of at least
two-thirds (2/3) in amount of the Allowed Interests actually voting in such
class have voted to accept this Plan.
11.5 Presumed Acceptance of Plan. Classes 1, 2A, 2B, 3 and 5 are
unimpaired under this Plan and, therefore, are conclusively presumed to have
accepted this Plan pursuant to section 1126(f) of the Bankruptcy Code.
11.6 Cramdown. Class 8 is deemed to have rejected the Plan.
Accordingly, the Debtor shall invoke cramdown with respect to such class
pursuant to section 1129(b) of the Bankruptcy Code. In addition, if Class 7
votes to reject the Plan, the Debtor shall invoke cramdown with respect to such
Class; provided, however, that Class 7 shall, in such event, nevertheless retain
such treatment as specified in Section 7.8 of this Plan.
ARTICLE XII
CONDITIONS PRECEDENT
12.1 Conditions to Confirmation. The following conditions must occur
and be satisfied, or be waived, on or before the Confirmation Date:
(a) The Confirmation Order shall have been signed by the
Bankruptcy Court and duly entered on the docket maintained for the
Chapter 11 Case by the Clerk of the Bankruptcy Court, in form and
substance reasonably acceptable to the Debtor, the Committee and the
Legal Representative;
(b) The Voting Procedures Order shall have been signed by the
Bankruptcy Court and duly entered on the docket maintained for the
Chapter 11 Case by the Clerk of the Bankruptcy Court, in form and
substance reasonably acceptable to the Debtor, the Committee and the
Legal Representative, and such Voting Procedures Order shall have
become a Final Order;
(c) The Transactions Stipulation Order shall have been signed by
the Bankruptcy Court and duly entered on the docket maintained for the
Chapter 11 Case by the Clerk of the Bankruptcy Court, in form and
substance reasonably acceptable to the Debtor, the Committee, the Legal
Representative and the Corporate Transactions Defendants;
(d) The Bankruptcy Court shall have signed an Order or Orders
approving the Creditors' Trust Documents, including the
Asbestos-Related Claims Resolution and Distribution Procedures, and
such Order or Orders shall have been duly entered on the docket
maintained by the Clerk of the Bankruptcy Court, in form and substance
reasonably acceptable to the Debtor, the Committee and the Legal
Representative;
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(e) The Bankruptcy Court shall have signed an Order, which may be
the Confirmation Order, establishing the Permanent Channeling
Injunction and the injunction set forth in Section 17.1, which Order
shall have been duly entered on the docket maintained by the Clerk of
the Bankruptcy Court, in form and substance reasonably acceptable to
the Debtor, the Committee and the Legal Representative;
(f) The Bankruptcy Court shall have signed an order, which may be
the Confirmation Order, converting the Coleman Injunction to a
permanent injunction, as set forth in Section 17.1, which Order shall
have been duly entered on the docket maintained by the Clerk of the
Bankruptcy Court, in form and substance reasonably acceptable to the
Debtor, the Committee, the Legal Representative and the Corporate
Transactions Defendants;
(g) All Causes of Action shall be preserved and provision shall
have been made to transfer the Causes of Action to the Creditors' Trust
for prosecution by the Creditors' Trust; and
(h) The Bankruptcy Court shall have made the following findings,
each of which shall be contained in the Confirmation Order:
(i) The Permanent Channeling Injunction is to be implemented
in connection with the Creditors' Trust.
(ii) At the time of the order for relief, Keene had been
named as a defendant in personal injury, wrongful death, and
property damage actions seeking recovery for damages allegedly
caused by the presence of, or exposure to, asbestos and
asbestos-containing products.
(iii) The Creditors' Trust, as of the Effective Date, will
assume the liabilities of the Debtor with respect to
Asbestos-Related Claims, Demands and Transactions Stipulation
Claims within the meaning of section 524(g) of the Bankruptcy
Code.
(iv) The Creditors' Trust is to be funded in whole or in
part by securities of the Debtor and by the obligation of the
Debtor to make future payments, including dividends.
(v) The Creditors' Trust is to own a majority of the voting
shares of New Keene.
(vi) The Creditors' Trust is to use its assets or income to
pay Asbestos-Related Claims and Demands.
(vii) The Debtor is likely to be subject to substantial
future Demands for payment arising out of the same or similar
conduct or events that gave rise to the Asbestos-Related Claims
and Demands that are addressed by the Permanent Channeling
Injunction.
(viii) The actual amounts, numbers and timing of the future
Demands cannot be determined.
(ix) Pursuit of such Demands outside the procedures
prescribed by the Plan is likely to threaten the Plan's purpose
to deal equitably with Asbestos-Related Claims and future
Demands.
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(x) The terms of the Permanent Channeling Injunction,
including any provisions barring actions against the Protected
Parties, pursuant to section 524(g)(4)(A) of the Bankruptcy Code,
are set forth in the Plan and in the Disclosure Statement.
(xi) The Plan establishes, in Classes 4A and B thereof
(Asbestos-Related Claims), separate classes of claimants whose
Claims are to be addressed by the Creditors' Trust.
(xii) The holders of Class 4 Claims, voting as a class, have
voted, by at least 75 percent (75%) of those voting, in favor of
the Plan.
(xiii) Pursuant to court orders or otherwise, the Creditors'
Trust will operate through mechanisms such as structured,
periodic, or supplemental payments, pro rata distributions,
matrices, or periodic review of estimates of the numbers and
values of present Asbestos-Related Claims and Demands, or other
comparable mechanisms, that provide reasonable assurance that the
Creditors' Trust will value, and be in a financial position to
pay, Asbestos-Related Claims and Demands that involve similar
Claims in substantially the same manner.
(xiv) The Legal Representative was appointed as part of the
proceedings leading to issuance of the Permanent Channeling
Injunction for the purpose of protecting the rights of Entities
that might subsequently assert Demands that are addressed in the
Permanent Channeling Injunction and transferred to the Creditors'
Trust.
(xv) Identifying each Protected Party is fair and equitable
with respect to Entities that might subsequently assert Demands
against any such Protected Party, in light of the benefits
provided, or to be provided, to the Creditors' Trust by or on
behalf of the Debtor and any such Protected Party.
12.2 Conditions to Effectiveness of Plan. The following conditions must
occur and be satisfied, or waived, on or before the Effective Date or the Plan
shall not become effective:
(a) There shall not be any stay in effect with respect to the
Confirmation Order;
(b) The Transactions Stipulation Order shall have become a Final
Order;
(c) The Confirmation Order and, if separate, the Order
establishing the Permanent Channeling Injunction, shall, to the extent
required by Section 524(g) of the Bankruptcy Code, have been issued or
affirmed by the United States District Court for the Southern District
of New York (the "District Court") and shall have become a Final Order
or Final Orders and shall have been duly entered on the docket of the
Clerk of the District Court;
(d) The Order, which may be the Confirmation Order, converting
the Coleman Injunction into a permanent injunction shall have become a
Final Order;
(e) The Confirmation Order and the Permanent Channeling
Injunction shall be in full force and effect;
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(f) The Trustees of the Creditors' Trust and the Trust Advisory
Committee shall have been selected in accordance with the terms of the
Creditors' Trust Agreement;
(g) All Trustees of the Creditors' Trust shall have executed the
Creditors' Trust Agreement;
(h) The Certificate of Merger shall have been filed with the
Office of the Secretary of State of the State of Delaware;
(i) The Keene 27 Action and all litigation to be dismissed as set
forth in the Stipulation and Order of Settlement Regarding a
Consensual Plan of Reorganization of the Debtor entered into on March
28, 1995 shall have been dismissed with prejudice pursuant to the
terms hereof and a Final Order shall have been entered dismissing such
actions and providing for the release and injunctive relief described
in Section 17.3(b) hereof; and
(j) The aggregate amount of Allowed and Disputed General
Unsecured Claims (Class 6) shall not exceed $5 million.
12.3 Waiver of Conditions. None of the conditions contained in Sections
12.1 and Section 12.2 hereof may be waived, in whole or in part, except jointly
by the Debtor, the Committee and the Legal Representative, in a writing to be
filed with the Bankruptcy Court, without any further notice to any Entity other
than as may be required by the Bankruptcy Court, without leave or order of the
Bankruptcy Court or any other formal action; provided, however, that the
conditions relating to the Transactions Stipulation Order, the Coleman
Injunction, and the General Unsecured Claims cap may not be waived without the
additional written consent of the Corporate Transactions Defendants, which
consent shall not be unreasonably withheld.
ARTICLE XIII
TREATMENT OF EXECUTORY CONTRACTS AND UNEXPIRED LEASES
13.1 Assumption/Rejection. Pursuant to section 1123(b)(2) of the
Bankruptcy Code, all executory contracts and unexpired leases of the Debtor that
have not already been assumed or rejected shall be deemed rejected as of the
Effective Date unless there is then pending before the Bankruptcy Court a motion
for the assumption and assignment of such executory contract and/or unexpired
lease.
13.2 Claims Based on Rejection of Executory Contracts or Unexpired
Leases. An Allowed Claim arising from the rejection of an executory contract or
an unexpired lease shall be classified and treated as a Class 3 or Class 6 Claim
depending on the amount thereof. Pursuant to the Order Establishing Last Date
for Filing Proofs of Claim for Non-Asbestos-Related General Claims entered on
September 28, 1994, all proofs of claim with respect to Claims arising from the
rejection, pursuant to this Article XIII, of executory contracts or unexpired
leases must be filed with the Bankruptcy Court on or before the later to occur
of: (i) thirty (30) days after the date of entry of an order of the Bankruptcy
Court approving such rejection or (ii) thirty (30) days after service of notice
of such rejection, if such rejection occurs by expiration of time fixed by the
Bankruptcy Court, or such Claims shall be forever barred against the Debtor and
its estate and the assets and properties of New Keene and the Creditors' Trust.
Any Entity that fails to file proof of its Claim arising from such a rejection
within the period set forth above shall be forever barred from asserting a Claim
against the Debtor, New Keene or the Creditors' Trust, any of their respective
affiliates or the property or interests in property of the Debtor, New Keene or
the Creditors' Trust, or any of their respective affiliates.
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ARTICLE XIV
IMPLEMENTATION OF THIS PLAN
14.1 Vesting of Property. Except as otherwise provided by this Plan, in
accordance with sections 1123(a)(5) and 1141 of the Bankruptcy Code, on the
Effective Date, title to property of the Debtor shall pass to New Keene free and
clear of all Claims, Demands, Interests, liens and encumbrances including,
without limitation, all Asbestos-Related Claims, Demands and Transactions
Stipulation Claims. Also, on the Effective Date, title to the Creditors' Trust
Distribution shall pass to the Creditors' Trust free and clear of all Claims,
Interests, liens and encumbrances, except liabilities relating to
Asbestos-Related Claims, Demands and Transactions Stipulation Claims.
14.2 Cancellation of Securities, Notes or Other Instruments; Release of
Liens. (a) As of the Effective Date, all Interests, notes or other instruments
evidencing a Claim, Demand or Interest shall be cancelled and rendered void and
each of the transfer books maintained for any such Claim, Demand, Interest, note
or other instrument shall be closed.
(b) Except for the right to receive the distributions, if any, provided
for by this Plan, the holder of a Claim, Demand, Interest, note or other
instrument shall have no rights arising from or relating to such Claim, Demand,
Interest, note or other instrument on and after the Effective Date.
14.3 Certificate of Incorporation and By-laws. The certificate of
incorporation and the by-laws of Keene shall be superseded, amended and restated
substantially in the forms set forth as Exhibits A and B hereto, and as so
amended and restated shall, as of the Effective Date, be in full force and
effect.
14.4 Corporate Authority. The entry of the Confirmation Order shall
constitute a direction and authorization to and of the Debtor, New Keene and the
Creditors' Trust to take or cause to be taken any corporate action necessary or
appropriate to consummate the provisions of this Plan, including without
limitation, the adoption of the Amended and Restated Certificate of
Incorporation and the Amended and Restated By-laws or similar constituent
documents for New Keene, the selection of directors and officers of New Keene,
the adoption of the SIP, the distribution of Cash and the issuance and
distribution of the New Common Stock, the adoption, execution, delivery and
implementation of all contracts, instruments, releases and other agreements
relating to this Plan, and all such actions taken or caused to be taken shall be
deemed authorized and approved in all respects without any further action by the
stockholders or directors of the Debtor or New Keene.
14.5 Retiree Benefits. New Keene as the contributing sponsor within the
meaning of ERISA will continue and maintain the Pension Plan. New Keene will
comply with all funding and other requirements of ERISA.
Unless and until the Pension Plan has been terminated, the Debtor and
New Keene will have no debt due the Pension Plan or the PBGC, and, accordingly,
any liabilities due the PBGC for any unfunded benefits liabilities shall not be
affected in any way by this reorganization, including the discharge. If the
Pension Plan has not been terminated prior to the Confirmation Date, any Claim
by the Pension Plan or the PBGC shall be treated as arising after the
Confirmation Date. Upon the Effective Date, any Claim that the PBGC has, or may
have asserted, shall be deemed to have been withdrawn.
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14.6 Term of Existing Injunctions or Stays. Unless otherwise provided
in the Plan, all injunctions or stays in effect on the Confirmation Date
pursuant to sections 105(a) or 362(a) of the Bankruptcy Code or otherwise shall
remain in full force and effect until the Effective Date.
ARTICLE XV
PROVISIONS GOVERNING DISTRIBUTIONS
15.1 Time of Distributions Under this Plan. Notwithstanding any other
provisions of this Plan, except with respect to Section 15.7 and Article XVI of
this Plan, payments and distributions on account of Allowed Claims, Demands and
Allowed Interests, and the transfer set forth in Section 9.2 hereof, shall be
made by the Debtor or New Keene on the Effective Date or as soon thereafter as
is reasonably practicable (but in no event later than ten (10) Business Days
after the Effective Date).
15.2 Settlement Regarding Distributions. Notwithstanding any other
provisions contained herein, distributions to holders of Allowed Claims, Demands
and Allowed Interests shall be as specified in this Plan, unless such holder
agrees to accept less favorable treatment by settlement or otherwise.
15.3 Distributions to Creditors' Trust. Any and all distributions to be
made to the Creditors' Trust pursuant to the terms of this Plan shall be made to
the Trustees of the Creditors' Trust for the benefit of holders of
Asbestos-Related Claims and Demands, all in accordance with applicable law,
including without limitation, the laws governing trusts.
15.4 Record Date. As of the close of business on the Record Date the
transfer ledger of Old Common Stock shall be closed, and there shall be no
further changes in the holders of record thereof. New Keene shall have no
obligation to recognize any transfer of the Old Common Stock occurring
thereafter. New Keene shall be entitled instead to recognize and deal for all
purposes herein with only those holders of record stated on the transfer ledger
for the Old Common Stock as of the close of business on the Record Date.
15.5 Manner of Payments Under This Plan. Solely for the purposes of
making distributions pursuant to the Plan, on the Effective Date, the Plan
Payments and the Plan Estimates shall be transferred to New Keene and maintained
in separate interest bearing accounts. Any Cash payment to be made pursuant to
the terms of this Plan may be made by a check or wire transfer or as otherwise
required or provided in applicable agreements.
15.6 Rounding. (a) Cash. Whenever any payment of a fraction of a cent
would otherwise be called for, the actual payment shall reflect a rounding of
such fraction to the nearest whole cent, with one-half cent being rounded up to
the nearest whole cent.
(b) No Fractional Shares. Notwithstanding anything contained herein to
the contrary, no fractional shares of New Common Stock will be distributed.
Whenever any distribution of a fraction of a share of New Common Stock would
otherwise be called for, the actual distribution shall reflect a rounding of
such fraction down to the nearest whole number of shares. Any shares of New
Common Stock remaining due to the rounding of such shares shall be held by New
Keene as Treasury Stock.
15.7 Undeliverable Distributions; Unclaimed Property. (a) If New Keene
is unable to make payment or distribution to the holder of an Allowed Claim or
an Allowed Interest under this Plan for lack of a current address for the holder
or otherwise, New Keene will file with the Bankruptcy Court the name, if known,
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and last known address of the holder and the reason for inability to make
payment, and if, after the passage of 60 days and after any additional effort to
locate the holder that the Bankruptcy Court may direct, the payment or
distribution still cannot be made, the payment or distribution and any further
payment or distribution to the holder shall be treated as unclaimed property in
accordance with Section 15.7(b) hereof.
(b) If any distribution of property remains unclaimed for a period of
one (1) year after it has been delivered in accordance with this Plan to the
holder entitled thereto, such unclaimed property shall be forfeited by such
holder, whereupon all right, title and interest in and to such unclaimed
property (i) shall immediately and irrevocably vest in the Creditors' Trust if
such property was to be distributed on account of an Allowed Administrative
Expense Claim, an Allowed Tax Claim or an Allowed Class 1, 2, 3 or 6 Claim, or
(ii) shall immediately and irrevocably vest with New Keene if such property was
to be distributed on account of an Allowed Class 7 Common Stock Interest.
15.8 Transmittal of Distributed Property and Notices. Except as
otherwise provided in this Plan and except as otherwise may be agreed to by the
Debtor or New Keene and the holder of a particular Claim or Interest, any
property or notice to which such holder shall become entitled pursuant to the
provisions of this Plan, shall be delivered to such holder by regular mail,
postage prepaid, in an envelope addressed to such holder as he or she or his or
her authorized agent may direct in a request filed, on or before the Effective
Date, with the Bankruptcy Court (or filed, after the Effective Date, with New
Keene), but if no such request is filed, to the address shown in the Schedules
or to such holder's counsel known to the Debtor, or, if a different address is
stated in a proof of claim duly filed, to such address. In all cases where
delivery or distribution is effectuated by mail, the date of delivery or
distribution shall be the date of mailing. Property delivered in accordance with
this Section 15.8 will be deemed delivered to the holder regardless of whether
such property is actually received by such holder.
15.9 Full and Final Satisfaction. Except as otherwise provided by this
Plan, all payments and other distributions made pursuant to the terms and
conditions of this Plan shall be in full and final satisfaction, settlement,
release and, to the extent permitted by applicable law, discharge of all Claims,
Demands and Interests.
15.10 No Distribution in Excess of Allowed Amount of Claim.
Notwithstanding anything to the contrary herein, no holder of an Allowed Claim
shall receive on account of such Claim any distribution (of a value set forth
herein or in the Disclosure Statement) in excess of the Allowed Amount of such
Claim, excluding payments on account of interest due and payable from and after
the Effective Date pursuant to the terms of this Plan.
15.11 Withholding Taxes. Any federal, state or local withholding taxes
or other amounts required to be withheld under any applicable law shall be
deducted from any payments or other distributions hereunder or otherwise. All
holders of Claims shall be required to provide information to effectuate the
withholding of such taxes.
15.12 Payment Dates. Whenever any payment or other distribution to be
made of the distributions pursuant to the terms of this Plan is due on a day
other than a Business Day, such payment or distribution will instead be made on
the next Business Day and shall be deemed to have been completed as of the
required date.
15.13 Setoffs. For purposes of determining the Allowed Amount of each
Claim on which a distribution shall be made, the Debtor or New Keene, as the
case may be, may, but shall not be required to, set off against any Claim, any
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claims of any nature whatsoever the Debtor may have against the claimant, but
neither the failure to do so nor the allowance of any Claim hereunder shall
constitute a waiver or release by the Debtor or New Keene of any such claim the
Debtor may have against any such claimant.
ARTICLE XVI
PROCEDURE FOR RESOLVING DISPUTED CLAIMS AND DISPUTED INTERESTS
16.1 Applicability. The procedure set forth in this Article XVI for
resolving Disputed Claims and Disputed Interests shall apply to all Claims and
Interests, other than Bonded Judgment Claims, Asbestos In Buildings Claims,
Asbestos-Related Personal Injury Claims and Transactions Stipulation Claims.
16.2 Objections to and Estimation and Resolution of Claims and
Interests. An objection to the allowance of a Claim or Interest, or any motion
pursuant to section 502(c) of the Bankruptcy Code to estimate any Claim, shall
be in writing and must be filed with the Bankruptcy Court by the Debtor, the
Committee or the Legal Representative (each, an "Objecting Party"), as the case
may be, on or before the Confirmation Date, or such later date as the Bankruptcy
Court may fix; provided, however, that any party in interest may object to an
application for allowance of compensation and reimbursement of expenses of
professionals under section 330 of the Bankruptcy Code; provided, further,
however, that objections to Asbestos-Related Claims (other than Asbestos-Related
Building Contribution Claims and Asbestos-Related Personal Injury Contribution
Claims) and Bonded Judgment Claims shall be addressed exclusively by the
Creditors' Trust and Transactions Stipulation Claims shall be dealt with in
accordance with the Transactions Stipulation.
16.3 Procedure. The Objecting Party shall litigate the merits of each
Disputed Claim and each Disputed Interest until determined by a Final Order and
shall litigate the amount at which a Disputed Claim or Interest shall be
estimated; provided, however, that subject to the approval of the Bankruptcy
Court, the Objecting Party may compromise and settle any objection to any Claim
or Interest.
16.4 Payments and Distributions With Respect to Ultimately Allowed
Claims or Ultimately Allowed Interests. Payments or other distributions shall be
made on account of a Disputed Claim or a Disputed Interest within thirty (30)
days after the date that such Disputed Claim or Disputed Interest becomes an
Ultimately Allowed Claim or Ultimately Allowed Interest; provided, however, that
no payments or other distributions shall be made on account of any Disputed
Class 6 Claim or Class 7 Interest until thirty (30) days after the date that the
last Disputed Class 6 Claim or Class 7 Interest challenged by any Objecting
Party becomes an Ultimately Allowed Claim or Ultimately Allowed Interest, or is
disallowed. Holders of Disputed Claims or Disputed Interests that become
Ultimately Allowed Claims or Ultimately Allowed Interests shall be bound,
obligated and governed in all respects by the provisions of this Plan. Upon
disallowance of a Disputed Claim, other than a Disputed Class 6 Claim, the
consideration reserved for such Claim (together with interest accrued thereon)
shall vest with the Creditors' Trust in accordance with Section 16.5(b) of this
Plan. Upon disallowance of a Disputed Class 6 Claim or a Disputed Class 7
Interest, the consideration reserved for such Class 6 Claim or Class 7 Interest
shall vest with New Keene whereupon New Keene shall distribute such property to
the members of such Class in accordance with Section 16.5(b) of the Plan.
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16.5 Reserves for Disputed Claims and Interests. (a) On or as soon as
practicable after the Effective Date, New Keene shall reserve for the account of
each holder of a Disputed Claim or Disputed Interest, (i) that property which
would otherwise be distributable to such holder on such date in accordance with
this Plan were such Disputed Claim or Disputed Interest an Allowed Claim or an
Allowed Interest, as applicable, on such date or (ii) such other property as
such holder and New Keene may agree. If applicable, New Keene shall place
property reserved pursuant to this Section 16.5 in an interest bearing escrow
fund (which need not be segregated, but for which separate book entries shall be
kept by New Keene) for each class to be established and maintained by New Keene
pending resolution of such Disputed Claims or Disputed Interests. Cash held in
any reserve established for Disputed Claims (the "Disputed Claims Reserve")
shall be invested in a manner consistent with the requirements of section 345 of
the Bankruptcy Code or any order of the Bankruptcy Court. Any voting rights of
Class A New Common Stock held in reserve on account of a Disputed Interest
shall, until such securities are released from such reserve, be deemed voted in
identical proportions to all other Class A New Common Stock that shall have
voted.
(b) Any Disputed Claims Reserve shall be terminated by New Keene once
all distributions and other dispositions of Cash and/or Class A New Common Stock
required hereunder have been made in accordance with the terms of this Plan. To
the extent that any Cash or other property remains in a Disputed Claims Reserve
established pending the resolution of Disputed Administrative Expense Claims,
Disputed Tax Claims or Disputed Class 1, 2B or 3 Claims (including any interest
accrued thereon), and such reserve has been terminated in accordance with this
Section 16.5(b), such Cash or other property shall immediately and irrevocably
vest in the Creditors' Trust which shall thereafter be empowered to take
whatever steps may be reasonably necessary to exercise control over such Cash or
other property. To the extent that any Cash or shares of Class A New Common
Stock remain in a Disputed Claims Reserve established pending resolution of
Disputed Class 6 Claims or Disputed Class 7 Interests, and such reserve has been
terminated in accordance with this Section 16.5(b), such Cash or shares of Class
A New Common Stock, as the case may be, shall be distributed, on a pro rata
basis, to Allowed Claims or Allowed Interests of the same class.
16.6 Funding of Objections Process. On and after the Effective Date,
the Creditors' Trust will pay the fees and expenses of the professionals
retained by New Keene, with the reasonable consent of the Creditors' Trust, that
are associated with the filing and prosecution of objections to Claims and
Interests within 30 days after the submission of a reasonably detailed invoice
to the Trustees setting forth such fees and expenses. Within ten (10) days after
the submission of an invoice, the Creditors' Trust may object to all or part of
such invoice; provided, however, that the Creditors' Trust shall be obligated to
pay the undisputed portion of such invoice within thirty (30) days of its
submission. In the event that the parties cannot resolve any dispute with
respect to the invoice within thirty (30) days after its submission, either the
Creditors' Trust or the affected professional may apply to the Bankruptcy Court
for resolution of the matter.
ARTICLE XVII
EFFECTS OF PLAN CONFIRMATION
17.1 Discharge, Releases and Injunction.
(a) Except as otherwise specifically provided by this Plan, the
distributions and rights that are provided in this Plan shall be in complete
satisfaction, release and, to the extent permitted by applicable law, discharge
of (i) all Claims and Demands against, liabilities of, liens on, obligations of
and Interests in the Debtor, New Keene or the Creditors' Trust or the assets and
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properties of the Debtor, New Keene or the Creditors' Trust, whether known or
unknown, and (ii) all causes of action, whether known or unknown, either
directly or derivatively through the Debtor or New Keene, against the Released
Parties based on the same subject matter as any Claim, Demand or Interest, in
each case, regardless of whether a proof of Claim or Interest was filed, whether
or not Allowed, and whether or not the holder of such Claim or Interest has
voted on this Plan, or based on any act or omission, transaction or other
activity or security, instrument or other agreement of any kind or nature
occurring, arising or existing prior to the Effective Date that was or could
have been the subject of any Claim, Demand or Interest, in each case, regardless
of whether a proof of Claim or Interest was filed, whether or not Allowed and
whether or not the holder of such Claim or Interest has voted on this plan.
Furthermore, but in no way limiting the generality of the foregoing,
except as otherwise specifically provided in this Plan, any Entity accepting any
distributions or rights pursuant to this Plan shall be presumed conclusively to
have released the Released Parties from any cause of action based on the same
subject matter as the Claim, Demand or Interest on which the distribution or
right is received to the full extent permitted by applicable law.
The satisfactions, releases and discharges set forth in this Section
17.1 shall also act as an injunction against any Entity commencing or continuing
any action, employment of process or act to collect, offset, affect or recover
any Claim, Demand, Interest or cause of action satisfied, released or discharged
hereunder.
On and after the Effective Date, the Coleman Injunction shall be
converted to a permanent injunction for the benefit of New Keene and the
Creditors' Trust, consistent with the terms and conditions of the Transactions
Stipulation, and shall prohibit any action or suit, with the exception of the
Transactions Lawsuit, against the Transactions Lawsuit Defendants.
(b) Notwithstanding Section 17.1(a) or any other provision of this Plan
to the contrary, the release and injunction set forth in Section 17.1(a) shall
not serve to release or enjoin claims by the Creditors' Trust against (i) the
Transactions Lawsuit Defendants in the Transactions Lawsuit; (ii) Bairnco
Corporation in the Bairnco NOL Action; (iii) Glenn W. Bailey in the Bailey
Lawsuit (as to those counts in the complaint not released under the Plan) and
(iv) any insurance carrier or surety that issued a policy or policies of
insurance to, or on behalf of, Keene or any of the above-referenced defendants.
17.2 Permanent Channeling Injunction and Keene 27 Injunction. On and
after the Effective Date, the Protected Parties shall obtain the benefits and
protections of the Permanent Channeling Injunction. In addition, on and after
the Effective Date, the Debtor, New Keene and their respective officers,
directors and agents shall obtain the benefits and protections of the Keene 27
Injunction.
17.3 No Release of Causes of Action.
(a) Notwithstanding any other provision of this Plan, pursuant to
section 1123(b)(3) of the Bankruptcy Code, the Creditors' Trust (as a
representative of the Debtor's estate) shall obtain title to and have the
exclusive right to and may commence, enforce, prosecute, manage and/or settle
against any Entity all Causes of Action of the Debtor, including those covered
by the Coleman Injunction, that arose before the Effective Date, including all
Causes of Action of a trustee and debtor-in-possession under the Bankruptcy Code
and any and all claims and causes of action arising under federal, state or
other applicable law; provided, however, that the estate will not commence, and
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the Creditors' Trust shall not obtain the right to commence any avoidance or
recovery action relating to payments made pursuant to the MIC Program, the 1992
Employee Retention Program or the Severance Policy, or in connection with the
Advisory Board or the Stock Dividends or relating to the Indemnity Payments as
against the Debtor's current and former officers and directors except as
otherwise asserted in the Bailey Lawsuit.
(b) The Causes of Action preserved in Section 17.3 shall not include
the Keene 27 Action. As required by Section 12.2, on the Effective Date, the
Debtor shall dismiss with prejudice the Keene 27 Action and such dismissal shall
be deemed to be in complete satisfaction and release of all claims and causes of
action that the Debtor may have against any of the defendants in the Keene 27
Action. In consideration for such dismissal and release, the Debtor, and its
officers, directors, agents and attorneys at the time the Keene 27 Action was
commenced, shall be deemed released from any claim or cause of action that the
estate or any defendant in the Keene 27 Action has or may have arising from or
in any way, directly or indirectly relating to the preparation, dissemination,
discussion, filing and/or prosecution of the Keene 27 Action and the Keene 27
Injunction shall be entered to effectuate such release.
17.4 Exculpation. Except as otherwise provided in the Plan, none of the
Released Parties shall have or incur any liability to any Entity for any act or
omission in connection with or arising out of the formulation, preparation,
dissemination, prosecution, confirmation, consummation, discussion,
implementation or administration of this Plan, the Disclosure Statement, any
contract, release, or other agreement or document created or entered into, the
property to be distributed under the Plan, or any other action taken or omitted
to be taken in connection with the Chapter 11 Case or this Plan, except for
gross negligence or willful misconduct, and in all respects shall be entitled to
rely upon the advice of counsel with respect to their duties and
responsibilities under the Plan.
ARTICLE XVIII
MISCELLANEOUS PROVISIONS
18.1 Retention of Jurisdiction. The business and assets of the Debtor
shall remain subject to the jurisdiction of the Bankruptcy Court until the
Effective Date. From and after the Effective Date, except as otherwise provided
by law, the Bankruptcy Court shall retain and have exclusive jurisdiction over
New Keene and the Chapter 11 Case for the purpose of determining all disputes
and other issues presented by or arising under this Plan including, without
limitation, the following matters:
(a) to allow, disallow, estimate, liquidate or determine any
Claim against or Interest in the Debtor and to enter or enforce any
order requiring the filing of any such Claim or Interest before a
particular date, and to resolve any and all disputes relating to any
Claim or Interest, except in each case an Asbestos-Related Personal
Injury Claim, an Asbestos In Buildings Claim, a Bonded Judgment Claim
or a Transactions Stipulation Claim;
(b) to determine requests for payment of Claims entitled to
priority under section 507(a)(1) of the Bankruptcy Code, including any
and all interim and final applications for compensation for
professional services rendered and disbursements incurred in
connection therewith;
(c) to resolve any and all controversies and disputes regarding
the interpretation and enforcement as may be necessary to effectuate
the consummation and full and complete implementation of this Plan;
<PAGE>
71
(d) to resolve any and all controversies and disputes regarding
the implementation or interpretation of the Creditors' Trust and
related matters, including, without limitation, the settlement of
accounts, the resolution of disputes between the TAC and the Trustees,
and the termination of the Creditors' Trust, as those matters are
provided for in paragraphs 2.2(f), 5.1(c) and 6.2(a)(iii),
respectively, of the Creditors' Trust Agreement, but excluding all
matters related to the Permanent Channeling Injunction, as set forth
in Section 18.2 hereof;
(e) to enter orders in aid of the execution of this Plan, and
releases provided for in this Plan, including, without limitation,
appropriate orders (which may include contempt or other sanctions) to
protect the Debtor, its affiliates and other Entities from actions
prohibited under Article XVII of this Plan;
(f) to remedy any defect or omission or reconcile any
inconsistency in the Confirmation Order;
(g) to determine any and all applications, motions, adversary
proceedings and contested matters pending on the Effective Date and
arising under, arising in or related to the Chapter 11 Case or this
Plan, including any remands of appeals that may be pending on the
Effective Date;
(h) to enforce the provisions of this Plan relating to the
distributions to be made hereunder;
(i) to resolve any action brought to avoid or otherwise determine
the validity, extent, enforceability, priority and perfection of any
lien or other encumbrance on any property of the Debtor;
(j) to determine any and all pending applications for the
rejection or disaffirmance of executory contracts or leases, and to
hear and determine, and if need be to liquidate, any and all Claims
arising therefrom;
(k) to resolve any disputes concerning any reserve established
for Disputed Claims or Disputed Interests or the administration
thereof;
(l) to resolve any disputes concerning any release of a nondebtor
hereunder or the injunction against acts, employment of process or
actions against such nondebtor arising hereunder;
(m) to resolve any disputes concerning whether a Entity had
sufficient notice of the Chapter 11 Case, any applicable Claims bar
date, the hearing on the approval of the Disclosure Statement as
containing adequate information, and the hearing on the confirmation
of this Plan for the purpose of determining whether a Claim, Demand or
Interest is satisfied, released or discharged hereunder or for any
other purpose;
(n) to determine such other matters as may be set forth in the
Confirmation Order or that may arise in connection with the
implementation of this Plan;
(o) to resolve any disputes regarding any invoice submitted to
the Creditors' Trust by a professional for fees and/or expenses
associated with the prosecution or settlement of objections to Claims
or Interests; and
<PAGE>
72
(p) to enter a final decree closing the Chapter 11 Case.
Notwithstanding anything contained in this Section 18.1, the reference
to the Bankruptcy Court with respect to the Transactions Lawsuit shall
be withdrawn as provided in the Transactions Lawsuit Stipulation.
18.2 Jurisdiction as to the Permanent Channeling Injunction. The United
States District Court for the Southern District of New York shall retain
jurisdiction over any proceeding that involves the validity, application,
construction, or modification of the Permanent Channeling Injunction.
18.3 Binding Effect of Plan. The provisions of this Plan and the
rights, benefits and obligations of any Entity named or referred to in this
Plan, including without limitation New Keene, any holder of a Claim, Demand or
Interest and the Creditors' Trust, shall be binding upon, and will inure to the
benefit of, such Entity's heirs, executors, administrators, successors, assigns,
agents, officers and directors.
18.4 Withdrawal of this Plan. The Debtor reserves the right, upon the
written consent of the Committee and the Legal Representative, to revoke and
withdraw this Plan as the plan of reorganization for the Debtor's Chapter 11
Case, at any time prior to the entry of the Confirmation Order or, if the
conditions set forth in Section 12.2 hereof cannot be satisfied for any reason
after the Confirmation Date, at any time up to the Effective Date. If the Debtor
revokes or withdraws this Plan or if the Confirmation Date or Effective Date
does not occur, then this Plan shall be deemed null and void.
18.5 Modification of this Plan. Prior to the entry of the Confirmation
Order, the Debtor reserves the right, upon the written consent of the Committee
and the Legal Representative, and in accordance with the Bankruptcy Code, to
amend or modify this Plan, and after the entry of the Confirmation Order, the
Debtor may, upon the written consent of the Committee and the Legal
Representative, upon order of the Court, amend or modify this Plan in accordance
with section 1127(b) of the Bankruptcy Code, or remedy any defect or omission or
reconcile any inconsistency in this Plan in such manner as may be necessary to
carry out the purpose and intent of this Plan; provided, however, that this Plan
may not be amended or modified in any manner that materially affects the rights
or obligations of the Corporate Transactions Defendants or the Subscribing
Individuals without the consent of each Corporate Transactions Defendant.
18.6 Transfer of Documents. On the Effective Date, or as soon
thereafter as reasonably practicable, the Debtor or New Keene, as the case may
be, shall transfer or make available to the Creditors' Trust any and all records
of Keene.
18.7 Cooperation. The Debtor, New Keene and the Creditors' Trust shall
cooperate with each other and provide each other with reasonable assistance in
connection with the performance of this Plan and the Creditors' Trust Documents.
18.8 Transfer of all Privilege. All privileges which the Debtor is
entitled to assert, including but not limited to attorney/client and work
product privileges, shall be transferred on the Effective Date to the Creditors'
Trust. The Creditors' Trust, in its sole and absolute discretion, may assert any
applicable privileges or use, disclose or waive any applicable privileges of the
Debtor with respect to any information or documents received or obtained
pursuant to this Section 18.8. In addition, New Keene shall make available to
the Creditors' Trust any persons then employed by New Keene as a director,
officer, employee, professional, agent or representative, at reasonable times
and on a reasonable basis, at the cost and expense of the Creditors' Trust, to
assist the Creditors' Trust in the performance of its duties, including the
prosecution of the Causes of Action. The Debtor shall be deemed to have
<PAGE>
73
authorized the Creditors' Trust, at the Creditors' Trust's cost and expense, for
itself and in the name of the Debtor, to the extent permitted by law (or with
the consent of the person(s) in question), to obtain from any of the Debtor's
current and former attorneys, special counsel, ordinary course professionals,
accountants, advisors, professionals, officers, directors, employees,
representatives or agents any and all information and documents which the Debtor
would be entitled or permitted to obtain; provided, however, that in the event
legal action is required to obtain such information or documents, or any cost or
expense shall be incurred in connection therewith, the Creditors' Trust shall
take such action, either in its name, or, if required, in the name of the
Debtor, and the Creditors' Trust shall bear all legal fees, costs and expenses
related thereto.
18.9 Confidentiality. The Creditors' Trust shall not be obligated or
required to disclose to New Keene any information, documents or professional
advice it receives or obtains relating or referring to the Causes of Action.
18.10 Tax Provision. The issuance, transfer or exchange of a security,
or the making, delivery or recording of a deed or other instrument of transfer
under this Plan shall constitute the issuance, transfer or exchange of a
security or the making or delivery of an instrument of transfer within the
meaning of section 1146(c) of the Bankruptcy Code, and shall not be taxed either
to the Debtor's estate, as seller, or to the transferee or recipient thereof
under any law imposing a stamp tax or similar tax.
18.11 Notices. All notices or requests to the Debtor in connection with
this Plan shall be in writing and will be deemed to have been given when
received by first class mail, postage prepaid or by overnight courier addressed
to:
(i) Keene Corporation
757 Third Avenue
New York, New York 10017
Attention: Mr. Timothy E. Coyne
with a copy to:
Berlack, Israels & Liberman LLP
Attorneys for Debtor and Debtor in Possession
120 West 45th Street
New York, New York 10036
Attention: Edward S. Weisfelner, Esq.;
(ii) Marcus Montgomery P.C.
Attorneys for Official Committee of Unsecured Creditors
53 Wall Street
New York, New York 10005-2899
Attention: John J. Preefer, Esq.;
and
(iii) Matthew Gluck, Esq.
Legal Representative of Future Claimants
Fried, Frank, Harris, Shriver & Jacobson
One New York Plaza
New York, New York 10004.
<PAGE>
74
All notices and requests to Entities holding any Claim or Interest in
any class shall be sent to them at their last known address or to the last known
address of their attorney of record who has filed a notice of appearance in the
Chapter 11 Case. The parties listed above, or any successors thereto, and any
such holder of a Claim or Interest may designate in writing any other address
for purposes of this Section 18.11, which designation will be effective upon
receipt.
18.12 Dissolution and Termination of Authority. On the Effective Date,
the Committee shall be dissolved, and the members of the Committee and their
representatives, the Legal Representative, the Transactions Claims Examiner, the
Plan Examiner, the Consultants and their respective professionals, and the
Debtor's legal and financial advisors, shall thereupon be released and
discharged of and from all further duties, responsibilities and obligations, if
any, related to, arising from and in connection with services rendered in their
respective capacities in the Chapter 11 Case.
18.13 Headings. The headings used in this Plan are inserted for
convenience only and neither constitute a portion of this Plan nor in any manner
affect the provisions of this Plan.
18.14 Severability. Should any provision in this Plan be determined to
be unenforceable, then, and in that event, this Plan shall be deemed modified to
delete such provision, and such determination shall in no way limit or affect
the enforceability and operative effect of any or all other provisions of this
Plan.
18.15 Entire Agreement. This Plan and the Exhibits hereto constitute
and contain the entire agreement of the parties with respect to the subject
matter hereof and, upon the Effective Date, collectively supersede any and all
prior negotiations, correspondence, understandings and agreements regarding the
subject matter hereof, including but not limited to, that certain Stipulation
and Order of Settlement Regarding a Consensual Plan of Reorganization of the
Debtor entered into on March 28, 1995.
Dated: New York, New York,
March 11, 1996
KEENE CORPORATION
By: /s/ TIMOTHY E. COYNE
--------------------------------
Name: Timothy E. Coyne
Title: Vice President--Finance
BERLACK, ISRAELS & LIBERMAN LLP
Counsel to Keene Corporation,
Debtor and Debtor in Possession
120 West 45th Street
New York, New York 10036
(212) 704-0100
By: /s/ Edward S. Weisfelner
------------------------------
Edward S. Weisfelner (EW 5581)
Janice B. Grubin (JG 1544)
<PAGE>
75
EXHIBIT A
TO
THE PLAN
Amended and Restated Certificate of Incorporation
of Reinhold Industries, Inc.
<PAGE>
76
AMENDED AND RESTATED
CERTIFICATE OF INCORPORATION OF
REINHOLD INDUSTRIES, INC.
ARTICLE I
The name of the corporation (the "Corporation") is: Reinhold
Industries, Inc.
ARTICLE II
The address of its registered office in the State of Delaware is 1209
Orange Street in the City of Wilmington, County of New Castle. The name of its
registered agent at such address is The Corporation Trust Company.
ARTICLE III
The nature of the business or purposes to be conducted or promoted by
the Corporation is to engage in any lawful act or activity for which
corporations may be organized under the General Corporation Law of the State of
Delaware (the "DGCL").
ARTICLE IV
The authorized amount of the capital stock of the Corporation and the
number and par value of the shares of which it is to consist are two million
five hundred thousand (2,500,000) shares, consisting of one million four hundred
eighty thousand (1,480,000) shares of Class A New Common Stock, par $.01 per
share ("Class A New Common Stock"), and one million twenty thousand (1,020,000)
shares of Class B New Common Stock, par value $.01 per share; provided, however,
that upon the conversion of Class B New Common Stock into Class A New Common
Stock, pursuant to this Article IV(8), the number of authorized shares of Class
A New Common Stock shall automatically be increased by the number shares of
Class B New Common Stock so converted and the number of authorized shares of
Class B New Common Stock shall be decreased by the number of shares so
converted, but in no event shall the authorized number of shares of Class A New
Common Stock exceed two million five hundred thousand (2,500,000). (Class A New
Common Stock and Class B New Common Stock are hereinafter collectively referred
to as the "Common Stock"). No shares of capital stock of the Corporation of any
class shall be issued without voting power as hereinafter provided. Except as
otherwise set forth in this Certificate of Incorporation, Class A New Common
Stock and Class B New Common Stock shall be identical and shall entitle the
holder thereof to the same rights and privileges. The designations, preferences,
privileges and voting powers of each class of stock of the Corporation, and the
restrictions or qualifications thereof, or manner of determining the same, shall
be as follows:
1. Except as provided herein, the holders of the Common Stock shall
have and possess all rights appertaining to full voting and participating
common stock of a corporation organized under the Delaware General
Corporation Law.
2. The affirmative vote of the holders of a majority of the
outstanding shares of Common Stock shall be required to authorize the
following: (i) any amendment to the Certificate of Incorporation of the
Corporation; provided, however, that in no event shall any amendment be
adopted which would adversely affect the voting rights of either the
holders of Class A New Common Stock or the holders of Class B New Common
Stock, as the case may be, without the consent of the holders of a majority
of the outstanding shares of the class whose rights will be adversely
<PAGE>
77
affected thereby; (ii) any amendment to the By-laws of the Corporation upon
which holders of Common Stock are entitled to vote; provided, however, that
any amendment of Article II or Article III of the By-laws shall require the
affirmative vote of the holders of a majority of the outstanding shares of
each of the Class A New Common Stock and the Class B New Common Stock;
(iii) any merger or consolidation of the Corporation with another
corporation or entity upon which holders of Common Stock are entitled to
vote; and (iv) any sale of assets or plan of dissolution of the Corporation
upon which holders of Common Stock are entitled to vote.
3. (a) The holders of the Class A New Common Stock, voting as a class,
shall elect one director of the Corporation until such time as the number
of shares of Class B New Common Stock represents less than twenty-five
(25%) percent of the aggregate number of shares of Common Stock then
outstanding, in which event the holders of the Class A New Common Stock,
voting as a class, shall elect two directors of the Corporation; provided,
however, that at such time all of the remaining shares of Class B New
Common Stock shall have been converted to Class A New Common Stock as set
forth in Article IV(5)(b), the holders of Class A New Common Stock, voting
as a class, shall elect all of the directors of the Corporation.
(b) Each director elected by the holders of Class A New Common
Stock shall be elected by a majority of the shares of the Class A New
Common Stock voting at such time.
4. (a) The holders of the Class B New Common Stock, voting as a class,
shall elect two directors of the Corporation until such time as the number
of shares of Class B New Common Stock represents less than twenty-five
(25%) percent of the aggregate number of shares of Common Stock then
outstanding, in which event the holders of the Class B New Common Stock,
voting as a class, shall elect one director.
(b) Each director elected by the holders of Class B New Common
Stock shall be elected by a majority of the shares of Class B New Common
Stock voting at such time.
5. Shares of Class B New Common Stock shall automatically be converted
into shares of Class A New Common Stock as follows:
(a) If the Creditors' Trust, as established pursuant to Section
9.1 of the Debtor's Third Amended Plan of Reorganization (the "Plan") of
Keene Corporation (Case No. 93 B 46090 (SMB), United States Bankruptcy
Court, Southern District of New York), shall assign, transfer or dispose of
any shares of Class B New Common Stock (other than to an entity in which
the Creditors' Trust owns all of the beneficial interests or in connection
with the pledge or hypothecation of such Class B New Common Stock to secure
bona fide indebtedness which is not convertible into Class B New Common
Stock), each such share so assigned, transferred or disposed of shall be
converted into one share of Class A New Common Stock;
(b) Upon the earlier to occur of (A) the date upon which the
number of shares of Class B New Common Stock shall represent less than ten
(10%) percent of the aggregate shares of Common Stock then outstanding, and
(B) the date occurring ten years from the Effective Date (as such term is
defined in the Plan), all of the then remaining shares of Class B New
Common Stock shall be converted into Class A New Common Stock;
(c) Upon conversion of shares of Class B New Common Stock into
shares of Class A New Common Stock, the holder of Class B New Common Stock
shall surrender the certificate representing such Class B New Common Stock
to the Corporation, which will issue new certificates reflecting such
conversion.
<PAGE>
78
6. No holder of shares of Common Stock shall be entitled, as a matter
of right, to subscribe for or purchase any part of any new or additional
issue of stock of any class whatsoever of the Corporation, or of securities
convertible into stock of any class whatsoever, whether now or hereafter
authorized or whether issued for cash or other consideration or by way of
dividend.
7. Each holder of Common Stock shall be entitled to one vote for each
share held by such holder.
8. (a) Except as otherwise provided herein, for a period of
twenty-five (25) months from the Effective Date, (A) no holder
("Transferor") of shares of Common Stock shall transfer, convey, assign,
pledge or otherwise dispose (including without limitation distributions
from the Creditors Trust, to any beneficiary thereof) of all, or any
interest in, the shares of Common Stock of such holder, or grant an option
or contractual right ("Rights") to acquire ownership of such shares
(whether or not currently exercisable) (collectively, a "Transfer") to any
person or entity or group of persons or entities acting in concert
("Transferee") and no Transferee shall acquire ownership of such shares or
Rights if, immediately following such Transfer, such Transferee owns or
thereby acquires ownership of more than four and three-quarters (4.75%)
percent of issued and outstanding shares of Common Stock (a Transferee who
has or acquires more than the allowed ownership percentage is hereinafter
referred to as a "Prohibited Transferee") and (B) no Transfer shall be made
by a person or entity or a group of persons or entities acting in concert
("Prohibited Transferor") who own five (5%) percent or more of the issued
and outstanding Shares of Common Stock. (Any Transfer prohibited by this
Article IV(8) is hereinafter referred to as a "Prohibited Transfer"). For
these purposes, a Transferee's ownership percentage of the Common Stock
shall be determined under Section 382 of the Internal Revenue Code of 1986,
as amended, and the Treasury Regulations promulgated thereunder which are
applicable on the date of such actual or purported transfer and shall
include direct ownership and adjustments for indirect ownership as required
under such statute and regulations.
(b) Within thirty (30) days of obtaining actual knowledge of any
Transfer, the Corporation may demand in writing that the Transferor making
a Transfer of, or the Transferee acquiring, such Common Stock provide a
certificate ("Certificate") to the Corporation within ten (10) days of
receipt of such notice, which Certificate sets forth the aggregate number
of shares of Common Stock owned, in title or beneficially, by the
Transferor or the Transferee both preceding and following such Transfer and
such other information (including, but not limited to, direct or indirect
interests in other entities owning shares of Common Stock, family
relationships with persons owning shares of Common Stock or direct or
indirect interests in entities owning such shares, and options or
contractual rights to purchase shares of Common Stock) as the Corporation
shall reasonably deem necessary to determine the Transferor's and the
Transferee's percentage ownership of Common Stock for purposes of this
Article IV(8).
(c) If, upon review of the Certificate and other available facts,
the Corporation determines that the Transferee is, or by reason of the
transfer has become, a Prohibited Transferee, or that the Transferor is a
Prohibited Transferor, the Corporation shall declare the transfer to a
Prohibited Transfer under this Article IV(8), and the acquisition of the
shares or Rights by the Prohibited Transferee or the Transfer of the shares
or Rights by a Prohibited Transferor, as the case may be, shall be deemed
null and void ab initio, the transfer agent for the Corporation shall treat
the shares subject to the Prohibited Transfer (including any shares subject
to Rights) as having never been transferred to, or acquired by, the
<PAGE>
79
Prohibited Transferee, or the Transferee of a Prohibited Transferor, and
the Corporation's books and records shall reflect that no Transfer of such
shares has occurred, unless the Board of Directors of the Corporation by
unanimous consent shall waive, in writing, the provisions of this Article
IV(8) with respect to such transfer.
(d) In the event of a Prohibited Transfer, any purported
Transferee shall not be entitled to any rights as a shareholder of the
Corporation, including, but not limited to, the right to vote shares
subject to a Prohibited Transfer, and the right to receive any dividend
distributions, including liquidating distributions on account thereon, and
the purported Transferee shall, upon written demand by the Corporation,
return any and all distributions which such Transferee shall have received
from the Corporation with respect to any shares of Common Stock subject to
a Prohibited Transfer.
(e) Each certificate evidencing Common Stock shall bear the
following restrictive legend:
(A) The front of such certificate shall bear a conspicuous
legend reading as follows:
"THE TRANSFER OF THE SECURITIES REPRESENTED HEREBY IS
SUBJECT TO RESTRICTION PURSUANT TO THE AMENDED AND
RESTATED CERTIFICATE OF INCORPORATION OF REINHOLD
INDUSTRIES, INC., WHICH RESTRICTION IS SUMMARIZED ON
THE BACK OF THIS CERTIFICATE."
(B) The back of such certificate shall bear a legend
reading as follows:
"Transfer of the shares of Common Stock of the
Corporation is restricted in accordance with Article
IV(8) of the Amended and Restated Certificate of
Incorporation of the Corporation, which prohibits the
acquisition of the ownership of shares, or rights to
acquire shares, of Common Stock by a person or entity
or persons or entities acting in concert which has, or
thereby would have, ownership of more than four and
three quarters (4.75%) percent of the issued and
outstanding shares of Common Stock, as determined under
Section 382 of Internal Revenue Code of 1986, as
amended, and the Treasury Regulations promulgated
thereunder (collectively, "Section 382"). The transfer
of shares, or rights to acquire shares, by a person or
entity or persons or entities acting in concert which
has ownership of five (5%) percent of the issued and
outstanding Common Stock of the Corporation, as
determined under Section 382, also is restricted in
accordance with Article IV(8) of the Amended and
Restated Certificate of Incorporation. Any transfer
prohibited by Article IV(8) of the Amended and Restated
Certificate of Incorporation of the Corporation shall
be null and void ab initio and will not be reflected on
the books and records of the Corporation, unless the
restrictions are waived by the unanimous consent of the
Board of Directors of the Corporation."
<PAGE>
80
ARTICLE V
The Corporation's Board of Directors shall consist of three members who
shall be elected as provided in Article IV.
ARTICLE VI
In furtherance and not in limitation of the powers conferred by
statute, the by-laws of the Corporation may be made, altered, amended or
repealed by a majority vote of the entire board of directors (except with
respect to Article II or Article III of the by-laws, which may be altered,
amended or repealed only by a unanimous vote of the entire board of directors)
or by the vote of the stockholders, approving the alteration, amendment or
repeal, as the case may be, in accordance with the provisions of Article IV(2).
ARTICLE VII
1. The Corporation shall indemnify to the fullest extent permitted
under and in accordance with the laws of the State of Delaware any person who
was or is a party or is threatened to be made a party to any threatened, pending
or completed action, suit or proceeding, whether civil, criminal, administrative
or investigative by reason of the fact that he is or was a director, officer,
employee or agent of or in any other capacity with another corporation,
partnership, joint venture, trust or other enterprise, against expenses
(including attorneys' fees), judgments, fines and amounts paid in settlement
actually and reasonably incurred by him in connection with such action, suit or
proceeding if he acted in good faith and in a manner he reasonably believed to
be in or not opposed to the best interests of the Corporation, and with respect
to any criminal action or proceeding, had no reasonable cause to believe his
conduct was unlawful.
2. Expenses (including attorneys' fees) incurred in defending any
civil, criminal, administrative or investigative action, suit or proceeding
shall (in the case of any action, suit or proceeding against a director of the
Corporation) or may (in the case of any action, suit or proceeding against an
officer, trustee, employee or agent) be paid by the Corporation in advance of
the final disposition of such action, suit or proceeding as authorized by the
Board upon receipt of an undertaking by or on behalf of the indemnified person
to repay such amount if it shall ultimately be determined that he is not
entitled to be indemnified by the Corporation as authorized in this paragraph.
3. The indemnification, advancement of expenses and other rights set
forth in this Paragraph shall not be exclusive of any provisions with respect
thereto in the by-laws or any other contract or agreement between the
Corporation and any officer, director, employee or agent of the Corporation.
4. Neither the amendment nor repeal of this Article VII, subparagraphs
1, 2 or 3, nor the adoption of any provision of this Certificate of
Incorporation inconsistent with Article VII, subparagraphs 1, 2 or 3, shall
eliminate or reduce the effect of this Article VII, subparagraphs 1, 2 and 3, in
respect of any matter occurring before such amendment, repeal or adoption of an
inconsistent provision or in respect of any cause of action, suit or claim
relating to any such matter which would have given rise to a right of
indemnification or right to receive expenses pursuant to this Article VII,
subparagraphs 1, 2 or 3, if such provision had not been so amended or repealed
or if a provision inconsistent therewith had not been so adopted.
<PAGE>
81
5. No director shall be personally liable to the Corporation or any
stockholder for monetary damages for breach of fiduciary duty as a director,
except for any matter in respect of which such director (A) shall be liable
under Section 174 of the DGCL or any amendment thereto or successor provision
thereto, or (B) shall be liable by reason that, in addition to any and all other
requirements for liability, he: (i) shall have breached his duty of loyalty to
the Corporation or its stockholders; (ii) shall not have acted in good faith or,
in failing to act, shall not have acted in good faith; (iii) shall have acted in
a manner involving intentional misconduct or a knowing violation of law or, in
failing to act, shall have acted in a manner involving intentional misconduct or
a knowing violation of law; or (iv) shall have derived an improper personal
benefit.
If the Delaware General Corporation Law is amended after the date of
incorporation of the Corporation to authorize corporation action further
eliminating or limiting the personal liability of directors, then the liability
of a director of the Corporation shall be eliminated or limited to the fullest
extent permitted by the Delaware General Corporation Law, as so amended.
6. This Certificate of Merger shall be effective on or such date as the
Order hereinabove referred to shall provide.
Dated: , 1996
ATTEST: REINHOLD INDUSTRIES, INC.
- ---------------------------- By:-------------------------------
Secretary Name:
Title:
ATTEST: KEENE CORPORATION
- ---------------------------- By:-------------------------------
Secretary Name:
Title:
<PAGE>
82
EXHIBIT B
TO
THE PLAN
Amended and Restated By-laws
of Reinhold Industries, Inc.
(formerly, Keene Corporation)
<PAGE>
83
AMENDED AND RESTATED BY-LAWS OF
REINHOLD INDUSTRIES, INC.
(FORMERLY, KEENE CORPORATION)
ARTICLE I
OFFICES
SECTION 1. Delaware Office. The registered office of Reinhold
Industries, Inc. (the "Corporation") within the State of Delaware shall be
maintained at the office of CT Corporation in the City of Dover, County of Kent.
SECTION 2. Other Offices. The Corporation may also have an office or
offices and keep the books and records of the Corporation, except as otherwise
may be required by law, in such other place or places, either within or without,
the State of Delaware, as the Board of Directors of the corporation (the
"Board") may from time to time determine or the business of the Corporation may
require.
ARTICLE II
MEETINGS OF STOCKHOLDERS
SECTION 1. Place of Meetings. All meetings of holders of shares of
capital stock of the Corporation shall be held at the office of the Corporation
in the State of Delaware or at such other place, within or without the State of
Delaware, as may from time to time be fixed by the Board or specified or fixed
in the respective notices or waivers of notice thereof.
SECTION 2. Annual Meetings. An annual meeting of stockholders of the
Corporation for the election of directors and for the transaction of such other
business as may properly come before the meeting (an "Annual Meeting") shall be
held on the first Tuesday of each [ ], commencing , 1997 or on such other date
and at such time as may be fixed by the Board. If the Annual Meeting shall not
be held on the day designated, the Board shall call a special meeting of
stockholders as soon as practicable for the election of directors.
SECTION 3. Special Meetings. Special meetings of stockholders, unless
otherwise provided by law, may be called at any time by the Board, the President
or stockholders owning, in the aggregate, twenty-five (25%) percent or more of
the outstanding Common Stock of the Corporation. Any such call must specify the
matters to be acted upon at such meeting and only such matters shall be acted
upon thereat.
SECTION 4. Notice of Meetings. Except as otherwise may be required by
law, notice of each meeting of stockholders, whether an Annual Meeting or a
special meeting, shall be in writing, shall state the purpose or purposes of the
meeting, the place, date and hour of the meeting and, unless it is an Annual
Meeting, shall indicate that the notice is being issued by or at the direction
of the person or persons calling the meeting, and a copy thereof shall be
delivered or sent by mail, not less than ten (10) nor more than sixty (60) days
before the date of said meeting, to each stockholder entitled to vote at such
meeting. In the event that a meeting relates solely to matters in which either
only the holders of Class A New Common Stock or Class B New Common Stock may
vote, such notice shall be given only to the holders of such class as shall be
entitled to vote thereon. If mailed, such notice shall be directed to such
stockholder at his address as it appears on the stock records of the
Corporation, unless he shall have filed with the Secretary a written request
that notices to him be mailed to some other address, in which case it shall be
directed to him at such other address. Notice of an adjourned meeting need not
be given if the time and place to which the meeting is to be adjourned was
announced at the meeting at which the adjournment was taken, unless (i) the
adjournment is for more than thirty (30) days or (ii) the Board shall fix a new
record date for such adjourned meeting after the adjournment.
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SECTION 5. Quorum. At each meeting of stockholders of the Corporation,
the holders of shares having majority of the voting power of the capital stock
of the Corporation issued and outstanding and entitled to vote thereat shall be
present or represented by proxy to constitute a quorum for the transaction of
business, except as otherwise provided by law; provided, however, that if the
meeting is called for the purpose of, or relates to, the election of directors
and the Corporation has both Class A New Common Stock and Class B New Common
stock outstanding, a quorum shall consist of the holders of shares having a
majority of the shares of Class A New Common Stock and a majority of the shares
of Class B New Common Stock, respectively.
SECTION 6. Adjournments. In the absence of a quorum at any meeting of
stockholders or any adjournment or adjournments thereof, holders of shares
having a majority of the voting power of the capital stock present or
represented by proxy at the meeting may adjourn the meeting from time to time
until a quorum shall be present or represented by proxy. At any such adjourned
meeting at which a quorum shall be present or represented by proxy, any business
may be transacted which might have been transacted at the meeting originally
called if a quorum had been present or represented by proxy thereat.
SECTION 7. Voting. Except as otherwise provided in the Certificate of
Incorporation of the Corporation (the "Certificate of Incorporation") at each
meeting of stockholders, every stockholder of the corporation entitled to vote
shall be entitled to one vote for every share of capital stock standing in his
name on the stock records of the Corporation (i) at the time fixed pursuant to
Section 6 of Article VII of these By-Laws as the record date for the
determination of stockholders entitled to vote at such meeting, or (ii) if no
such record date shall have been fixed, then at the close of business on the day
next preceding the day on which notice thereof shall be given. At each meeting
of stockholders, all matters shall be decided by a majority of the votes cast at
such meeting by the holders of shares of capital stock present or represented by
proxy and entitled to vote thereon, a quorum being present, except where a
different vote is required by law or the Certificate of Incorporation.
SECTION 8. Inspectors. For each election of directors by the
stockholders and in any other case in which it shall be advisable, in the
opinion of the Board, that the voting upon any matter shall be conducted by
inspectors of election, the Board shall appoint two inspectors of election. If,
for any such election of directors or the voting upon any such other matter, any
inspector appointed by the Board shall be unwilling or unable to serve, or if
the Board shall fail to appoint inspectors, the chairman of the meeting shall
appoint the necessary inspector or inspectors. The inspectors so appointed,
before entering upon the discharge of their duties, shall be sworn faithfully to
execute the duties of inspectors with strict impartiality, and according to the
best of their ability, and the oath so taken shall be subscribed by them. Such
inspectors shall determine the number of shares of capital stock of the
Corporation outstanding and the voting power of each of the shares represented
at the meeting, the existence of a quorum, and the validity and effect of
proxies, and shall receive votes, ballots or consents, hear and determine all
challenges and questions arising in connection with the right to vote, count and
tabulate all votes, ballots or consents, determine the result, and do such acts
as are proper to conduct the election or vote with fairness to all stockholders
on request of the chairman of the meeting or any stockholder entitled to vote
thereat, the inspectors shall make a report in writing of any challenge,
question or matter determined by them and shall execute a certificate of any
fact found by them. No director or candidate for the office of director shall
- -act as an inspector of election of directors. Inspectors need not be
stockholders.
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ARTICLE III
DIRECTORS
SECTION 1. Powers. The business and affairs of the Corporation shall be
managed by or under the direction of the Board. The Board may select one of its
members to be Chairman of the Board. The Chairman of the Board shall, if
present, preside at all meetings of the Board and of the stockholders. If the
Chairman is not present, the members of the Board then present will elect one of
the members so present to serve as Acting Chairman.
SECTION 2. Number, Election and Terms. The total number of directors
constituting the entire Board shall be three. Any vacancies on the Board
resulting from death, resignation, disqualification, removal or other cause
shall be filled as follows:
(a) If the vacancy relates to a director who was elected by the holder
of the Class B New Common Stock of the Corporation, such vacancy shall be
filled by such holder.
(b) If the vacancy relates to a director who was elected by the
holders of the Class A New Common Stock of the Corporation, and there
remain one or more directors elected by the holders of the Class A New
Common Stock, such vacancy shall be filled by the affirmative vote of a
majority of such remaining directors, or by the sole remaining director
elected by such holders if there shall be only one such director; however,
if there is no remaining director elected by the holders of the Class A New
Common Stock, the remaining directors shall call a special meeting of the
holders of the Class A New Common Stock for the purpose of electing a
director to fill such vacancy.
Any director elected in accordance with either of this Section 2(a) or 2(b)
shall hold office until the Annual Meeting at which the term of office to which
such director has been elected expires and until such director's successor shall
have been duly elected and qualified.
SECTION 3. Nominations of Directors; Election. Nominations for the
election of directors may be made by the Board or by any stockholder entitled to
vote generally in the election of directors who complies with the procedures set
forth in this Section 3. Directors shall be at least 21 years of age. Directors
need not be stockholders. At each meeting of stockholders for the election of
directors at which a quorum is present, the persons receiving a plurality of the
votes cast shall be elected directors. All nominations by stockholders shall be
made pursuant to timely notice in proper written form to the Secretary of the
Corporation. To be timely, except in the case of a director to be elected by the
holder of the Class B New Common Stock at a Special Meeting, a stockholder's
notice shall be delivered to or mailed and received at the principal executive
offices of the Corporation not less than thirty (30) days nor more than sixty
(60) days prior to the meeting; provided, however, that in the event that less
than forty (40) days notice or prior public disclosure of the date of the
meeting is given or made to stockholders, notice by the stockholder to be timely
must be so received not later than the close of business on the tenth (10th) day
following the day on which such notice of the date of the meeting was mailed or
such public disclosure was made. To be in proper written form, such stockholders
notice shall set forth in writing (i) as to each person whom the stockholder
proposes to nominate for election or reelection as a director, all information
relating to such person that is required to be disclosed in solicitations of
proxies for election of directors, or is otherwise required, in each case
pursuant to Regulation 14A under the Securities Exchange Act of 1934, as
amended, including, without limitation, such person's written consent to being
named in the proxy statement as a nominee and to serving as a director if
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elected; and (ii) as to the stockholder giving the notice, (x) the name and
address, as they appear on the Corporations books, of such stockholder and (y)
the class and number of shares of the Corporation which are beneficially owned
by such stockholder. In the event that a stockholder seeks to nominate one or
more directors, the Secretary shall appoint two inspectors, who shall not be
affiliated with the Corporation, to determine whether a stockholder has complied
with this Section 3. If the inspectors shall determine that a stockholder has
not complied with this Section 3, the inspectors shall direct the chairman of
the meeting to declare to the meeting that a nomination was not made in
accordance with the procedures prescribed by the By-Laws of the Corporation, and
the chairman shall so declare to the meeting and the defective nomination shall
be disregarded.
SECTION 4. Place of Meetings. Meetings of the Board shall be held at
the Corporation's office in the State of Delaware or at such other place, within
or without such State, as the Board may from time to time determine or as shall
be specified or fixed in the notice or waiver of notice of any such meeting.
SECTION 5. Regular Meetings. Regular meetings of the Board shall be
held quarterly in accordance with a yearly meeting schedule as determined by the
Board; or such meetings may be held on such other days and at such other times
as the Board may from time to time determine. Notice of regular meetings of the
Board need not be given except as otherwise required by these By-Laws.
SECTION 6. Special Meetings. Special meetings of the Board may be
called by the Chairman or the President and shall be called by the Secretary at
the request of any two directors.
SECTION 7. Notice of Meetings. Notice of each special meeting of the
Board (and of each regular meeting for which notice shall be required), stating
the time, place and purposes thereof, shall be mailed to each director,
addressed to him at his residence or usual place of business, or shall be sent
to him by telex, cable or telegram so addressed, or shall be given personally or
by telephone on twenty-four hours' notice.
SECTION 8. Quorum and Manner of Acting. The presence of at least a
majority of the authorized number of directors shall be necessary and sufficient
to constitute a quorum for the transaction of business at any meeting of the
Board. Except where a different vote is required by law, the Certificate of
Incorporation or these By-Laws, the act of a majority of the directors present
at any meeting at which a quorum shall be present shall be the act of the Board;
provided, however, that the affirmative vote of the entire Board of Directors
shall be required to amend Article II or Article III of these By-laws. Any
action required or permitted to be taken by the Board may be taken without a
meeting if all the directors consent in writing to the adoption of a resolution
authorizing the action. The resolution and the written consents thereto by the
directors shall be filed with the minutes of the proceedings of the Board. Any
one or more directors may participate in any meeting of the Board by means of a
conference telephone or similar communications equipment allowing all persons
participating in the meeting to hear each other at the same time. Participation
by such means shall be deemed to constitute presence in person at a meeting of
the Board.
SECTION 9. Resignation. Any director may resign at any time by
giving written notice to the Corporation; provided, however, that
written notice
to the Board, the Chairman of the Board, the President or the Secretary shall be
deemed to constitute notice to the Corporation. Such resignation shall take
effect upon receipt of such notice or at any later time specified therein and,
unless otherwise specified therein, acceptance of such resignation shall not be
necessary to make it effective.
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SECTION 10. Removal of Directors. Any director may be removed from
office, with or without cause, by the affirmative vote of such number of shares
of Common Stock as would be sufficient to elect him if then voted at a meeting
held to elect the entire Board of Directors.
ARTICLE IV
COMMITTEES OF THE BOARD
SECTION 1. Appointment and Powers of Executive Committee. The Board
may, by resolution adopted by the affirmative vote of a majority of the
authorized number of directors, designate an Executive Committee of the Board
which shall consist of such number of members (but not less than three) as the
Board shall determine, one of whom shall be the President. Except as provided by
Delaware law, during the interval between the meetings of the Board, the
Executive Committee shall possess and may exercise all the powers of the Board
in the management and direction of all the business and affairs of the
Corporation (except the matters hereinafter assigned to any other Committee of
the Board), in such manner as the Executive Committee shall deem in the best
interests of the Corporation in all cases in which specific directions shall not
have been given by the Board. A majority of the members of the Executive
Committee shall constitute a quorum for the transaction of business by the
committee and the act of a majority of the members of the committee present at a
meeting at which a quorum shall be present shall be the act of the committee.
Either the President or the Chairman of the Executive Committee may call the
meetings of the Executive Committee.
SECTION 2. Appointment and Powers of Audit Committee. The Board may, by
resolution adopted by the affirmative vote of a majority of the authorized
number of directors, designate an Audit Committee of the Board, which shall
consist of such number of members of the Board as the Board shall determine. The
Audit Committee shall (i) make recommendations to the Board as to the
independent accountants to be appointed by the Board; (ii) review with the
independent accountants the scope of their examination; (iii) receive the
reports of the independent accountants and meet with representatives of such
accountants for the purpose of reviewing and considering questions relating to
their examination and such reports; (iv) review, either directly or through the
independent accountants, the internal accounting and auditing Procedures of the
Corporation; and (v) perform such other functions as may be assigned to it from
time to time by the Board. The Audit Committee may determine its manner of
acting and fix the time and place of its meetings, unless the Board shall
otherwise provide. A majority of the members of the Audit Committee shall
constitute a quorum for the transaction of business by the committee and the act
of a majority of the members of the committee present at a meeting at which a
quorum shall be present shall be the act of the committee.
SECTION 3. Other Committees. The Board may, by resolution adopted by
the affirmative vote of a majority of the authorized number of directors,
designate members of the Board to constitute such other committees of the Board
as the Board may determine. Such committees shall in each case consist of such
number of directors as the Board may determine, and shall have and may exercise,
to the extent permitted by law, such powers as the Board may delegate to them,
in the respective resolution, appointing them. Each such committee may determine
its manner of acting and fix the time and place of its meeting, unless the Board
shall otherwise provide. A majority of the members of any such committee shall
constitute a quorum for the transaction of business by the committee and the act
of a majority of the members of such committee present at a meeting at which a
quorum shall be present shall be the act of the committee.
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SECTION 4. Action by Consent; Participation by Telephone or Similar
Equipment. Unless the Board shall otherwise provide, any action required or
permitted to be taken by any committee may be taken without a meeting if all
members of the committee consent in writing to the adoption of a resolution
authorizing the action. The resolution and the written consents thereto by the
members of the committee shall be filed with the minutes of the proceedings of
the committee by means of conference telephone or similar communications
equipment by means of which all persons participating in the meeting can hear
one another. Participation by such means shall constitute presence in person at
a meeting of the committee.
SECTION 5. Changes in Committees; Resignations. The Board shall have
power, by the affirmative a majority of the authorized number of directors, at
any time, change the members of, to fill vacancies in, and to discharge any
committee of the Board. Any member of any such committee may resign at any time
by giving notice to the Corporation; provided, however, that notice to the
Board, the Chairman of the Board, President, the chairman of such committee or
the Secretary shall be deemed to constitute notice to the Corporation. Such
resignation shall take effect upon receipt of such notice or at any later time
specified therein; and, unless otherwise specified therein, acceptance of such
resignation shall not be necessary to make it effective. Any member of any such
committee may be removed at any time, either with or without cause, by the
affirmative vote of a majority of the authorized number of any meeting of the
Board called for that.
ARTICLE V
OFFICERS
SECTION 1. Number and Qualification. The Corporation shall have such
officers as may be necessary or desirable for the business of the Corporation.
There shall be elected by the Board persons having the titles and exercising the
duties (as prescribed by the By-Laws or by the Board) of Chairman of the Board,
President, Vice President, Treasurer and Secretary, and such other persons
having such other titles and such other duties as the Board may prescribe. The
same person may hold more than one office. The Chairman of the Board shall be
elected from among the directors. Unless otherwise determined by the Board, the
officers of the Corporation shall be elected by the Board at the annual meeting
of the Board, and shall be elected to hold office until the next succeeding
annual meeting of the Board. In the event of the failure to elect officers at
such annual meeting, officers may be elected at any regular or special meeting
of the Board. Each officer shall hold office until his successor has been
elected and qualified, or until his earlier death, resignation or removal.
SECTION 2. Resignations. Any officer may resign at any time by giving
written notice to the Corporation; provided, however, that notice to the Board,
the President, Chairman of or the Secretary shall be deemed to constitute notice
to the Corporation. Such resignation shall take effect upon receipt of such
notice or at any later time specified therein.
SECTION 3. Vacancies. Any vacancy among the officers, whether caused by
death, resignation, removal or any other cause, shall be filled in the manner
prescribed for election or appointment to such office.
SECTION 4. President. The President shall be the chief executive
officer of the corporation. The President shall have general and day to day
supervision of the business and affairs of the Corporation. He shall perform the
duties incident to the office of the President and all such other duties and
shall have such other powers as are specified in these By-Laws or as shall be
assigned to or conferred upon him from time to time by the Board by resolution
or in any employment agreement approved by the Board.
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SECTION 5. Vice President. Each Vice President shall perform such
duties and exercise such powers as may be assigned to him from time to time by
the Board. In the absence of a President, the duties of a President shall be
performed and his powers may be exercised by such Vice President as may be
designated by the President or, failing such designation, such duties shall be
performed and such power may be exercised by each Vice President in the order of
their earliest election to that office; subject in any case to review and
superseding action by the President.
SECTION 6. Treasurer. The Treasurer shall have charge and custody of,
and responsibility for, all funds and securities of the Corporation, shall keep
full and accurate accounts of receipts and disbursements in books belonging to
the Corporation, shall deposit all moneys and other valuables for the credit of
the corporation in such depositaries as may be designated pursuant to these
By-Laws, shall receive, and give receipts for, moneys due and payable to the
Corporation from any source whatsoever, shall disburse the funds of the
Corporation and shall render at all regular meetings of the Board, or whenever
the Board may require, an account of all his transactions as Treasurer. He
shall, in general, perform all the duties incident to the office of Treasurer
and all such other duties as may be assigned to him from time to time by the
President or such other officers whom the Treasurer reports.
SECTION 7. Secretary. The Secretary shall, if present, act as secretary
of, and keep the minutes of all meetings of the Board, the Executive Committee
and other committees of the Board and the stockholders in one or more books
provided for that purpose, shall see that all notices are duly given in
accordance with these By-Laws and as required by law, shall be custodian of the
seal of the corporation and shall affix and attest the seal to all documents to
be executed on behalf of the Corporation under its seal. He shall, in general,
perform all the duties incident to the office of Secretary and all such other
duties as may be assigned to him from time to time by the President or such
other officer to whom the secretary reports.
SECTION 8. Additional Officers. The Board may by resolution appoint
such other officers and agents as it may deem appropriate, and such other
officers and agents shall hold their offices for such terms and shall exercise
such powers and perform such duties as may be determined from time to time by
the Board.
SECTION 9. Bonds of Officers. If required by the Board, any officer of
the Corporation shall give a bond for the faithful discharge of his duties in
such amount and with such surety or sureties as the Board may require.
SECTION 10. Salaries. The salaries of all officers and agents of the
Corporation shall be fixed by the Board. No officer shall be prevented from
receiving any such salary by reason of the fact that he is also a director of
the Corporation.
ARTICLE VI
CONTRACTS, CHECKS, LOANS, DEPOSITS, ETC.
SECTION 1. Contracts. The Board may authorize any officer or officers,
agents, in the name and on behalf of the Corporation, to enter into any contract
or to execute and deliver any instrument, which authorization may be general or
confined to specific instances; and, unless so authorized by the Board, no
officer, agent or employee shall have any power or authority to bind the
Corporation by any contract or engagement or to pledge its credit or to render
liable pecuniarily for any purpose or for any amount.
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SECTION 2. Checks, etc. All checks, drafts, bills of exchange or other
orders for the Payment of money out of the funds of the corporation, and all
notes or other evidences of indebtedness of the Corporation, shall be signed in
the name and on behalf of the Corporation in such manner as shall from time to
time be authorized by the Board, which authorization may be general or confined
to instances.
SECTION 3. Loans. No loan shall be contracted on behalf of the
corporation, and no negotiable paper shall be issued in its name, unless
authorized by the Board, which authorization may be general or confined to
specific instances. All bonds, debentures, notes and other obligations or
evidences of indebtedness of the Corporation issued for such loans shall be
made, executed and delivered as the Board shall authorize.
SECTION 4. Deposits. All funds of the Corporation not otherwise
employed shall be deposited from time to time for the credit of the Corporation
in such banks, trust companies or other depositaries as may be selected by or in
the manner designated by the Board. The Board or designees may make such special
rules and regulations with respect to such bank accounts, not inconsistent with
the provisions of the Certificate of Incorporation or these By-laws, as they may
deem advisable.
ARTICLE VII
CAPITAL STOCK
SECTION 1. Stock Certificate. Each stockholder shall be entitled to
have, in such form as shall be approved by the Board, a certificate or
certificates signed by the Chairman of the Board or the President, and by either
the Treasurer or an Assistant Treasurer or the Secretary or an Assistant
Secretary (except that, when any such certificate is countersigned by a transfer
agent or registered by a registrar other than the Corporation or an employee of
the Corporation, the signatures of any such officers may be facsimiles, engraved
or printed), which may be sealed with the seal of the Corporation (which seal
may be a facsimile, engraved or printed), certifying the number of shares of
capital stock of the Corporation owned by such stockholder. In the event any
officer who has signed or whose facsimile signature has been placed upon any
such certificate shall have ceased to be such officer before such certificate is
issued, such certificate may be issued by the Corporation with the same effect
as if he were such officer at the date of its issue. Certificates evidencing
shares of Common Stock shall bear the restrictive legend required by the
Certificate of Incorporation relating to Net Operating Losses of the
Corporation.
SECTION 2. List of Stockholders Entitled to Vote. The officer of the
Corporation who has charge of the stock ledger of the Corporation shall prepare
and make or cause to be prepared or made, at least ten (10) days before every
meeting of stockholders, a complete list of the stockholders entitled to vote at
the meeting arranged in alphabetical order, and showing the address of each
stockholder and the number of shares of capital stock registered in the name of
each stockholder. Such list shall be open to the examination of any stockholder,
for any purpose germane to the meeting, during ordinary business hours, for a
period of at least ten (10) days prior to the meeting, either at a place within
the city where the meeting is to be held, which place shall be specified in the
notice of the meeting, or, if not so the place where the meeting is to be held.
The list shall also be produced and kept at the time and place of the meeting
for the duration thereof, and may be inspected by any stockholder of the
Corporation who is present.
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SECTION 3. Stock Ledger. The stock ledger of the Corporation shall be
the only evidence as to who are the stockholders entitled to examine the stock
ledger, the list required by Section 2 of this Article VII or the books of the
Corporation, or to vote in person or by proxy at any meeting of stockholders.
SECTION 4. Transfers of Capital Stock. Transfers shares of capital
stock of the Corporation shall be made only on the stock ledger of the
Corporation by the holder of record thereof, by his attorney thereunto
authorized by power of attorney duly executed and filed with the Secretary of
the Corporation, or by the transfer agent of the Corporation, and only on
surrender of the certificate or certificates representing such shares, properly
endorsed or accompanied by a duly executed stock transfer power. The Board may
make such additional rules and regulations as it may deem advisable concerning
the issue and transfer of certificates representing shares of the capital stock
of the Corporation.
SECTION 5. Lost Certificates. The Board may direct a new certificate to
be issued in place of any certificate theretofore issued by the Corporation
alleged to have been lost, stolen or destroyed, upon the making of an affidavit
of that fact by the person claiming the certificate of stock to be lost, stolen
or destroyed. When authorizing such issue of a new certificate, the Board may,
in its discretion and as a condition precedent to the issuance thereof, require
the owner of such lost, stolen or destroyed certificate, or his legal
representative, to give the Corporation a bond in such sum as it may direct as
indemnity against any claim that may be made against the corporation with
respect to the certificate alleged to have been lost, stolen or destroyed.
SECTION 6. Fixing of Record Date. In order that the Corporation may
determine the stockholders entitled to notice of or to vote at any meeting of
stockholders or any adjournment thereof, or entitled to receive payment of any
dividends or other distributions or allotments of any rights, or entitled to
exercise any rights in respect to any change, conversion or exchange of stock,
or for the purpose of any other lawful action, the Board may fix, in advance, a
record date, which shall not be more than sixty (60) days nor less than ten (10)
days before the date of such meeting, nor more than sixty (60) days prior to any
other action. A determination of stockholders of record entitled to notice of or
to vote at a meeting of stockholders shall apply to any adjournment of the
meeting; provided, however, that the Board may fix a new record date for the
adjourned meeting.
SECTION 7. Beneficial Owner. The Corporation shall be entitled to
recognize the exclusive right of a person registered on its books as the owner
of shares to receive dividends and to vote as such owner, and to hold liable for
calls and assessments a person registered on its books as the owner of shares,
and shall not be bound to recognize any equitable or other claim to or interest
in such shares on the part of any other person, whether or not the Corporation
shall have express or other notice thereof, except as otherwise provided by law.
ARTICLE VIII
FISCAL YEAR
The Corporation's fiscal year shall coincide with the calendar year.
ARTICLE IX
SEAL
The corporate seal shall be in such form as the Board of Directors
shall prescribe.
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ARTICLE X
WAIVER OF NOTICE
Whenever any notice is required by law, the Certificate of
Incorporation or these By-Laws to be given to any director, member of a
committee or stockholder, a waiver thereof in writing, signed by the person or
persons entitled to such notice, whether signed before or after the time stated
in such written waiver, shall be deemed equivalent to such notice. Attendance of
a person at a meeting shall constitute a waiver of notice of such meeting,
except when such person attends a meeting for the express purpose of objecting,
at the beginning of the meeting, to the transaction of any business on the
grounds that the meeting is not lawfully called or convened. Neither the
business to be transacted at, nor the purpose of, any meeting of the
stockholders, directors, or members of a committee of Directors need be
specified in any written waiver of notice.
ARTICLE XI
AMENDMENTS
These By-Laws or any of them may be amended or supplemented in any
respect at any time, either (i) at any meeting of stockholders; provided that
any amendment or supplement proposed to be acted upon at any such meeting shall
have been described or referred to in the notice of such meeting; or (ii) at any
meeting of the Board, provided that any amendment or supplement proposed to be
acted upon at any such meeting shall have been described or referred to in the
notice of such meeting or an announcement with respect thereto shall have been
made at the last previous Board meeting, and provided further that no amendment
or supplement adopted by the Board shall vary or conflict with any amendment or
supplement adopted by the stockholders.
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EXHIBIT C
TO
THE PLAN
Certificate of Merger
of Reinhold Industries, Inc.
into Keene Corporation
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CERTIFICATE OF MERGER OF
REINHOLD INDUSTRIES, INC.
INTO
KEENE CORPORATION
The undersigned corporation organized and existing under and by virtue
of the General Corporation Law of Delaware, DOES HEREBY CERTIFY:
FIRST: That the name and state of incorporation of each of the
constituent corporations of the merger is as follows:
NAME STATE OF INCORPORATION
Keene Corporation.......................... Delaware
Reinhold Industries, Inc................... Delaware
SECOND: That provision for the making of this Certificate of Merger of
Reinhold Industries, Inc. into Keene Corporation and for the making of the
amendment to the Certificate of Incorporation of Keene Corporation is contained
in an order, dated , 1996, of the United States Bankruptcy Court for the
Southern District of New York (the "Bankruptcy Court"), in In re Keene
Corporation, Case No. 93 B 46090.
THIRD: That this Certificate of Merger has been duly executed and
acknowledged by the officers of the corporation so designated in such order of
the Bankruptcy Court in accordance with Sections 251 and 303 of the General
Corporation Law of the State of Delaware.
FOURTH: That the name of the surviving corporation of the merger is
"Keene Corporation", which name is being changed as set forth below.
FIFTH: That the Certificate of Incorporation of the surviving
corporation of the merger shall be amended and restated to read in its entirety
as follows:
[To be attached to Amended and Restated
Certificate of Incorporation]
<PAGE>
95
EXHIBIT D
TO
THE PLAN
Creditors' Trust Agreement
<PAGE>
96
CREDITORS TRUST AGREEMENT
This Creditors Trust Agreement ("Trust Agreement") dated as of among
Keene Corporation, as trustor (the "Trustor" or the "Debtor"), Archie R. Dykes,
Richard A. Lippe, and John J. Robbins, as Trustees, and New Keene.
WHEREAS, the Trustor filed a voluntary petition for relief under Title
11 of Chapter 11 of the United States Code (the "Bankruptcy Code") on December
3, 1993 and proposed a plan of reorganization (the "Plan")* which called for the
establishment of the Creditors Trust (the "Trust"); and
WHEREAS, pursuant to the Plan, the Trust is to use its assets and/or
income to liquidate and to pay in accordance with the Asbestos Related Personal
Injury and Asbestos In Buildings Claims Resolution and Distribution Procedures
attached hereto as Exhibit A and B (collectively, the "Procedures") Asbestos
Related Claims and Demands against the Debtor, as defined in Sections 101(5) and
524(g)(5) of the Bankruptcy Code, respectively; and
WHEREAS, pursuant to the Plan, the Trust is intended to qualify as a
"designated settlement fund" or a "qualified settlement fund" within the meaning
of Section 1.468B-1 of the Treasury regulations promulgated under Section 468B
of the Internal Revenue Code; and
WHEREAS, the Bankruptcy Court (the "Court") has determined that the
Trust and the Plan satisfy all the prerequisites for a supplemental injunction
pursuant to Section 524(g) of the Bankruptcy Code, which Permanent Channelling
Injunction has been entered in connection with the Order confirming the Plan;
and
WHEREAS, in order to effectuate the Debtor's Plan, to provide for the
payment of Asbestos Related Claims and Demands and to receive the benefits under
the Internal Revenue Code of so providing for certain of such payments, the
Trustor desires to enter into this Trust Agreement with the Trustees and
transfer the Creditors Trust Distribution (the "Trust Assets") to the Trust
pursuant hereto.
NOW, THEREFORE, IT IS HEREBY AGREED as follows:
ARTICLE I
DECLARATION OF TRUST
1.1 Name. The Trust shall be known as the "Keene Creditors Trust", and
the Trustees may transact the business and affairs of the Trust in that name.
- -----------------------------
* Unless the context requires otherwise, all capitalized terms used
herein and not otherwise defined have the meanings assigned thereto in
the Plan for Keene Corporation as confirmed by an Order of the
Bankruptcy Court.
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97
1.2 Purpose. The purposes of the Trust are (i) to assume the
liabilities within the meaning of Section 524(g)(2)(B)(i)(1) of the Bankruptcy
Code of the Debtor and its successors in interest resulting from personal
injury, wrongful death, or property-related damage attributable to the presence
of, or exposure to, the Debtor's asbestos or asbestos-containing products; (ii)
to use the Trust Assets and income to pay holders of valid Asbestos Related
Claims and Demands in accordance with this Trust Agreement and the Procedures;
and (iii) to otherwise comply in all respects with the requirements of a trust
set forth in Section 524(g)(2)(B)(i) of the Bankruptcy Code.
1.3 Transfer of Assets. The Trustor hereby transfers and assigns to the
Trust the assets listed on Schedule 1 attached hereto (the "Trust Assets")
having heretofore obtained all consents and taken all other steps prerequisite
to such transfer and assignment. New Keene, as the successor to the Trustor for
this purpose, shall take any and all steps as may be further necessary to
effectuate fully the transfer and assignment of the Trust Assets.
1.4 Acceptance of Assets and Assumption of Liabilities.
(a) In connection with and in furtherance of the purposes of the Trust
and subject to Section 4.4, below, the Trustees hereby expressly accept the
transfer and assignment to the Trust of the Trust Assets and the Trust hereby
further expressly assumes liability within the meaning of Section
524(g)(2)(B)(i)(1) of the Bankruptcy Code for, and undertakes and shall control,
liquidating in accordance with the Procedures all Asbestos Related Claims and
Demands.
(b) The Trust shall indemnify New Keene for any expenses, costs, fees
(including attorneys fees), judgments, settlements, or other liabilities
asserted at any time after the Effective Date of the Plan arising from or
incurred in connection with an Asbestos Related Claim or Demand. Nothing in this
section or any other section of this Trust Agreement shall be construed in any
way to limit the scope, enforceability, or effectiveness of the Permanent
Channelling Injunction issued by the Bankruptcy Court in connection with the
Plan.
ARTICLE II
POWERS; TRUST ADMINISTRATION
2.1 Powers. (a) Subject to the limitations set forth in this Trust
Agreement, the Trustees shall have the power to take any and all such actions as
in the judgment of the Trustees are necessary or convenient to effectuate the
purposes of the Trust, including, without limitation, each power expressly
granted in Subsection 3.1(c) below and any power reasonably incidental thereto.
(b) Except as provided in the Plan or otherwise specified herein, the
Trustees need not obtain an order of approval of any court in the exercise of
any power or discretion conferred hereunder.
(c) Without limiting the generality of Subsection 2.1(a) above, the
Trustees shall have the power to:
(i) receive and hold the Trust Assets, and invest monies held
from time to time therein, transfer, exchange or sell any or all
assets of the Trust on such terms as the Trust considers proper and to
sell all or any part of the securities issued by the Trustor that are
included in the Trust Assets, subject to the restrictions set forth in
the Amended and Restated Certificate of Incorporation of New Keene;
(ii) supervise and administer the Procedures;
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(iii) pay Trust expenses, liabilities and to pay Claims and
Demands as such Claims and Demands are determined in accordance with
the Procedures or otherwise;
(iv) borrow money and issue notes and other evidences of
indebtedness (which notes or other evidences of indebtedness shall
exonerate the Trustees from personal liability with respect thereto)
in the ordinary course of operations for payment of indemnification
liabilities and other Trust expenses and the Claims;
(v) enter into any other agreement required by the Plan or
reasonably necessary or beneficial to implement the Plan and the
Procedures and perform all of the Trust's obligations thereunder,
including, without limitation, enter into any agreement with other
asbestos claims resolution organizations to implement the Procedures;
(vi) commence, prosecute, settle, dismiss or abandon any of the
Causes of Action;
(vii) extend a line of credit to New Keene pursuant to the terms
of the New Keene Credit Facility;
(viii) exercise all rights and benefits accruing to the Trust as
owner of any shares of New Common Stock that the Trust shall own from
time to time;
(ix) establish such funds, reserves and accounts within the
Trust, in addition to the funds created hereby, as deemed by the
Trustees to be useful in carrying out the purposes of the Trust;
(x) sue and be sued and participate, as a party or otherwise, in
any judicial, administrative, arbitrative or other proceeding,
including, without limitation, in connection with the Procedures;
(xi) adopt and amend any by-laws desirable for the administration
of the Trust;
(xii) appoint such officers and hire such employees and engage
such legal, financial and other advisors, professionals and agents as
the business of the Trust requires and to delegate to such persons
such powers, authority, and discretion as the Trustees deem advisable
or necessary in order to carry out the purposes of the Trust, and pay
the Trustees, subject to Section 4.5 and pay such officers, employees,
advisors and agents reasonable compensation as determined by the
Trustees and properly documented out-of-pocket costs and expenses;
(xiii) to pay the compensation and properly documented
out-of-pocket expenses and costs of the members of the TAC and any
legal, financial and other advisors or professionals retained by the
TAC;
(xiv) enter into such other arrangements with third parties as
are deemed by the Trustees to be useful in carrying out the purposes
of the Trust (including, without limitation, engaging an Entity having
trust powers to act as paying agent, depositary, custodian, or trustee
with respect to funds, reserves or accounts created hereby or
established pursuant hereto);
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(xv) indemnify (and purchase insurance indemnifying) the
Trustees, officers, employees, agents, advisors and professionals and
representatives of the Trust, the members of the TAC and their
professionals and advisors and New Keene to the fullest extent that a
corporation organized under New York law is from time to time entitled
to indemnify its directors, officers, employees, agents or
representatives;
(xvi) enter into any contract or otherwise engage in any
transaction with any Trustee or any Entity affiliated with any
Trustee, provided, however, that such contract or such transaction is
approved by the unanimous vote of the Trustees voting thereon, it
being understood that to the extent permitted by law the usual rules
prohibiting fiduciaries from dealing with themselves as individuals or
from dealing with respect to any manner in which they have a personal
interest shall not apply to the Trustees;
(xvii) delegate any or all of the discretionary power and
authority herein conferred at any time with respect to all or any
portion of the Trust Assets to any one or more reputable individuals
or recognized institutional advisors or investment managers without
liability for any action taken or omission made because of any such
delegation;
(xviii) associate with, contract with and/or use the resources of
and/or merge with any other claims resolution facility if the Trustees
shall determine by unanimous vote that such claims resolution facility
has the capacity to evaluate and/or pay Claims and Demands in a manner
generally consistent with the purposes of the Trust and the Plan, and
not inconsistent with the Procedures; and
(xix) execute and deliver such deeds, leases and other
instruments as the Trustees consider proper in administering the
Trust.
(d) The Trustees on behalf of the Trust shall not have the power to
guarantee any debt of other Entities, except in connection with the sale of
Trust Assets in which case the Trust shall have the power to provide a guarantee
in an amount not exceeding the consideration received by the Trust on the sale.
2.2 Administration. (a) The Trust shall be administered as follows:
(i) Offices. The principal office of the Trust shall be in the
City of [New York] or at such other place, within or without the State
of [New York], as the Trustees may from time to time determine to be
necessary for the efficient and cost-effective administration of the
Trust.
(ii) Regular Meetings. Regular meetings of the Trustees may be
held at such time as from time to time shall be determined by the
Trustees with notice to the TAC; provided, however, that the Trustees
shall meet at least once per calendar quarter during the first year
following the execution of this agreement and at least once per year
thereafter.
(iii) Special Meetings; Notice. Special meetings of the Trustees
shall be held whenever called by the Managing Trustee (defined below).
Notice of each such meeting shall be mailed by first class mail,
postage prepaid, to each Trustee and the members of the TAC, addressed
to them at their residences or usual places of business, at least
three days before the date on which the meeting is to be held, or
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100
shall be sent to such place by facsimile, telegraph, cable, radio or
wireless, or be delivered personally or by hand or by express mail or
overnight courier or by telephone, not later than the day before the
day on which such meeting is to be held. Such notice shall state the
place, date and hour of the meeting and the purpose(s) for which it is
called. In lieu of the notice to be given as set forth above, a waiver
thereof in writing, signed by the Trustees entitled to receive such
notice and by the members of the TAC, either before or after the
meeting, shall be deemed equivalent thereto for purposes of this
Section.
(iv) Action Without a Meeting; Meeting by Conference Call. Any
action required or permitted to be taken at any meeting of the
Trustees or the TAC may be taken without a meeting if all of the
Trustees or all the members of the TAC, as the case may be, consent
thereto in writing, and the writing or writings are filed with the
minutes of proceedings of the Trustees or the TAC.
The Trustees or members of the TAC may participate in a meeting
of the Trustees or the TAC, as the case may be, by means of conference
telephone or similar communication equipment provided that all persons
participating in the meeting can hear each other. Participation in a
meeting pursuant to this paragraph shall constitute presence in person
at such meeting.
(b) Accounting Period. The accounting period for the Trust (the "Fiscal
Year") shall be selected by the Trustees.
(c) Delivery of Trust Documents to New Keene. The Trustees shall timely
file or shall deliver to New Keene such documents and other information as New
Keene may reasonably require in order to permit it to timely file such income
tax and other returns and statements as are required of it to comply with
applicable provisions of the Internal Revenue Code and state law and any
regulations promulgated thereunder.
(d) Annual Reports. The Trustees shall cause to be prepared and filed
with the Court, with copies to the members of the TAC, as soon as available but,
in any event, within 90 days following the end of each Fiscal Year, an annual
report containing financial statements of the Trust (including, without
limitation, a balance sheet and a statement of operations for such Fiscal Year)
audited by a firm of independent public accountants selected by the Trustees and
certified by such firm as to fairness of presentation and consistency, a report
on the number of Claims received and the number of Claims liquidated, if any,
and the amount per Claim paid or payable and such other information as the Trust
deems relevant.
(e) Tax Returns. The Trustees shall timely file income tax and other
returns and statements and comply with all withholding obligations as required
under applicable provisions of the Internal Revenue Code and state law and any
regulations promulgated thereunder.
(f) Settlement of Trustees' Accounts. Notwithstanding any state law to
the contrary, the Court shall have exclusive jurisdiction over the settlement of
the accounts of the Trustees, whether such account is rendered by the Trustees
themselves or is sought by any person holding an Asbestos Related Claim or
Demand or other person. The Trustees shall render successive accounts covering
periods of one year. In addition, an account shall be rendered for the period
ending on the date of the death, resignation, removal or retirement of any
Trustee. Upon the acceptance of any such account by the Court after hearing on
notice to New Keene, the TAC and such other parties as the Court shall
designate, the Trustees shall be discharged from any further liability or
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responsibility to any person holding an Asbestos Related Claim or Demand or
other Person, as to all matters embraced in such account.
ARTICLE III
ACCOUNTS, PAYMENTS AND INVESTMENTS
3.1 Accounts.
(a) The Trustees may, from time to time, create additional funds,
reserves and accounts within the Trust as they may deem necessary, prudent or
useful in order to provide for the payment of Trust expenses, Claims and Demands
or otherwise to effectuate the purposes of the Trust and may, with respect to
any such fund, reserve or account, restrict the use of monies therein.
(b) After establishing a reasonable reserve for expenses of the Trust
including indemnification of the Trustees and the TAC, if required, the Trustees
shall promptly establish a separate fund (the "Litigation Reserve") which
Litigation Reserve shall be separately maintained solely for the prosecution of
the Causes of Action in an amount determined by the Trustees to be sufficient
for the costs and expenses of the full prosecution of the Causes of Action. The
Litigation Reserve shall be maintained as a separate fund until the Transaction
Lawsuit and the Bairnco Lawsuit are concluded. The amount of the Litigation
Reserve shall be determined with the advice and consent of the TAC.
(c) After payment of expenses of the Trust, including, establishment of
a reserve for the reasonable future expenses of the Trust, the Litigation
Reserve pursuant to Section 3.1(b) above and line of credit to New Keene as
provided for in subsection 2.1(c)(vii) and, if necessary, a reserve for the
indemnification of the Trustees and the TAC, the remaining Cash and any
additional cash received by the Trust, net of expenses ("Available Cash") shall
be allocated into two funds as follows:
(i) 92 1/2% of the first $100 million of Available Cash; 90% of
Available Cash between $100 million and $150 million and 87% of
Available Cash above $150 million shall be held in a fund for
distributions to holders of Asbestos Related Personal Injury Claims
and Demands (the "Asbestos Personal Injury Fund");
(ii) 7 1/2% of the first $100 million of Available Cash 10% of
Available Cash between $100 and $150 million and 12 1/2% of Available
Cash above $150 million shall be held in a fund for distributions to
holders of Asbestos in Building Damage Claims (the "Asbestos in
Building Claims").
3.2 Payments.
(a) At such time as the Trust has at least $30 million of Available
Cash, the Trust shall:
(i) cause estimates to be made of the numbers and values of
pending and projected Asbestos Related Personal Injury Claims and
Demands with the assistance of a consultant familiar with asbestos
disease claim projections and at the same time cause estimates to be
made of the total Available Cash and non cash assets held by the Trust
except for the Causes of Action unless at the time a settlement is
pending.
(ii) calculate the pro rata share of the Asbestos Personal Injury
Fund for the payment of Asbestos-Related Personal Injury Claims and
Demands so that the holders thereof shall receive substantially the
same percentage payment on subsequent distribution dates;
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(iii) make distributions from the Asbestos Personal Injury Fund
in accordance with Procedures.
(iv) make distributions from the Asbestos in the Building Fund in
accordance with the Procedures.
(b) At any time subsequent to the distribution of Available Cash
pursuant to Section 3.2(a) as the Trustees believe they are likely to have
Available Cash to pay claimants, the Trust shall cause an additional estimate to
be made of the numbers and values of Asbestos-Related Personal Injury Claims and
Demands and valuation of Trust Assets in the same manner as in subsections
3.2(a) (i) and (ii) above, and shall cause additional distributions to be made
in the same manner as in subsections 3.2(a)(iii) and 3.2(a)(iv) above.
(c) Recognizing that it is desirable to make payment to claimants
expeditiously, provided it is economically prudent given the funds then
available to the Trust, nevertheless the Trustees may determine to defer making
any payments under either of the Procedures if the Trustees, after consultation
with the TAC, determine that the administrative costs of such an expeditious
payment is proportionately so significant that no payment should be made pending
receipt of additional funds.
(d) In making any estimates, judgments or decisions concerning the
amounts to be paid, percentages, pro rata payments, and timing of payments, the
judgment and decisions of the Trustees shall be final and conclusive and not
subject to review.
3.3 Investments. Investment of funds held in the Trust shall be
invested in the manner in which individuals of ordinary prudence, discretion and
judgment would act in the management of their own affairs, subject to the
following limitations and provisions:
(a) The Trust shall not acquire, directly or indirectly, equity in any
Entity (other than New Keene and its subsidiaries, successors and assigns) or
business enterprise if, immediately following such acquisition, the Trust would
hold more than 5% of the equity in such Entity or business enterprise unless (1)
such Entity or business enterprise is an asbestos claims processing facility or
(2) such equity has been conveyed to the Trust in full or partial consideration
for settlement of a lawsuit in which the Trust is a plaintiff. The Trust shall
not hold, directly or indirectly, more than 10% of the equity in any Entity
(other than New Keene and its subsidiaries, successors and assigns) or business
enterprise, unless (1) such Entity or business enterprise is an asbestos claims
processing facility or (2) such equity has been conveyed to the Trust in full or
partial consideration for settlement of a lawsuit in which the Trust is a
plaintiff.
(b) The Trust shall not acquire nor hold any long-term debt securities
unless such securities (i) are rated "A" or higher by Moody's Investors Service,
Inc. ("Moody's"), "AA" or higher by Standard & Poor's Corporation ("S&P") or
have been given an equivalent investment grade rating by another nationally
recognized statistical rating agency or (ii) have been issued or fully
guaranteed as to principal and interest by the United States of America or any
agency or instrumentality thereof or (iii) unless (1) such securities have been
issued by an asbestos claims processing facility or (2) such securities have
been conveyed to the Trust in full or partial consideration for settlement of a
lawsuit in which the Trust is a plaintiff.
(c) The Trust shall not acquire nor hold for longer than ninety days
any commercial paper unless such commercial paper is rated "Prime-1" or higher
by Moody's or "A-1" or higher by S&P or has been given an equivalent investment
grade rating by another nationally recognized statistical rating agency.
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(d) The Trust shall not acquire nor hold any equity in any Entity or
business enterprise (other than New Keene, its subsidiaries, successors and
assigns) unless such equity is in the form of securities which are traded on a
national securities exchange or major international securities exchange or
through the National Association of Securities Dealers Automated Quotation
System or unless (1) such Entity or business enterprise is an asbestos claims
processing facility or (2) such equity has been conveyed to the Trust in full or
partial consideration for settlement of a lawsuit in which the Trust is a
plaintiff.
(e) The Trust shall not acquire nor hold any preferred stock unless
such preferred stock is rated "B" or higher by Moody's or "B+" or higher by S&P
or has been given an equivalent investment grade rating by another nationally
recognized statistical rating agency, and also complies with subsection (d)
above or unless such preferred stock is (1) preferred stock of an asbestos
claims processing facility or (2) such preferred stock has been conveyed to the
Trust in full or partial consideration for settlement of a lawsuit in which the
Trust is a plaintiff.
(f) The Trust shall not acquire any debt securities or other
instruments issued by any Entity (other than debt securities or other
instruments issued or fully guaranteed as to principal and interest by the
United States of America or any agency or instrumentality thereof) if, following
such acquisition, the aggregate market value of all securities and instruments
issued by such Entity held by the Trust would exceed 5% of the aggregate value
of the Trust Assets, unless (1) such Entity or business enterprise is an
asbestos claims processing facility or (2) such securities or instruments have
been conveyed to the Trust in full or partial consideration for settlement of a
lawsuit in which the Trust is a plaintiff. The Trust shall not hold any debt
securities or other instruments issued by any Entity (other than debt securities
or other instruments issued or fully guaranteed as to principal and interest by
the United States of America or any agency or instrumentality thereof) to the
extent that the aggregate market value of all such securities and instruments
issued by such Entity held by the Trust would exceed 10% of the aggregate value
of the Trust Assets, unless (1) such Entity or business enterprise is an
asbestos claims processing facility or (2) such securities or instruments have
been conveyed to the Trust in full or partial consideration for settlement of a
lawsuit in which the Trust is the plaintiff.
(g) The Trust shall not acquire nor hold any certificates of deposit
unless all publicly held long-term debt securities, if any, of the financial
institution issuing the certificate of deposit and the holding company, if any,
of which such financial institution is a subsidiary, meet the standards set
forth in Section 3.3(b), above.
(h) The Trust shall not acquire nor hold any repurchase obligations
unless, in the opinion of the Trustees, they are adequately collateralized.
(i) Notwithstanding the foregoing guidelines, the Trust shall have the
authority to extend credit to New Keene as described above in Subsection
2.1(c)(vii) hereof.
3.4 Source of Payments. All Trust expenses and payments in respect of
Claims and Demands shall be payable solely out of the Trust Assets. Neither the
Trustees nor any officer, agent or employee of the Trust nor any member of the
TAC, nor the Trustor nor any of its present subsidiaries nor any director,
officer, employee or agent of the Trustor or any of their subsidiaries shall be
liable for the payment of any Trust expense, Claim, Demand or liability of the
Trust except as provided in the Plan, and no Entity shall look to any of the
foregoing Entities for satisfaction of any such expense, Claim, Demand or
liability; provided, however, that nothing in this Section 3.4 shall limit the
right of the Trustees and the Trust to claim against any officer, agent or
employee of the Trust, the Trustor, or any officer, director, agent or
subsidiary of the Trustor for breach of employment agreement or other breach of
duty to the Trust.
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ARTICLE IV
TRUSTEES
4.1 Number; Managing Trustee.
(a) There shall be three Trustees (the "Initial Trustees") from the
commencement of the Trust until the expiration of the initial term of service
described below in Section 4.2. The Initial Trustees shall be those persons
named in the signature page hereto. After the Initial Term, there shall be one
Trustee until the termination of the Trust in accordance with the terms hereof.
(b) One of the Initial Trustees selected by the Trustees shall serve as
Managing Trustee and shall be compensated for his or her services as Managing
Trustee. The Managing Trustee shall serve as the Trust's liaison, shall
coordinate and schedule meetings of the Trustees and shall handle all
administrative matters that come before the Trust.
4.2 Term of Service.
(a) Each Initial Trustee shall serve for a period of three years (the
"Initial Term") or until his or her death, incapacity, resignation or removal.
If any such event should occur within the Initial Term a successor will be
appointed.
(b) After the Initial Term, the Trustees shall select one Trustee to
serve as the sole Trustee until his or her (i) death or incapacity, (ii) removal
or (iii) resignation.
(c) Any Trustee may resign at any time by written notice to each of the
remaining Trustees and the TAC. Such notice shall specify a date when such
resignation shall take effect, which shall not be less than 30 days after the
date such notice is given, unless the remaining Trustees after consultation with
the TAC consent to an earlier date for the effect of a resignation.
(d) Any Trustee may be removed for cause by the majority vote of the
other Trustees, such removal to take effect at such time as the Trustees shall
by such vote determine.
4.3 Appointment of Successor Trustee.
(a) In the event of a vacancy during the Initial Term in the position
of Trustee, the vacancy shall be filled by unanimous vote of the remaining
Trustees after consultation with the TAC, who shall take into account the
relevant provisions hereof.
(b) If, after the Initial Term has expired, a vacancy is caused by
death, incapacity, resignation or removal of the sole Trustee, the TAC shall
nominate a successor trustee for approval of the Court. Before a vacancy occurs,
after the Initial Term, the sole Trustee may appoint a successor with consent of
the TAC.
(c) Immediately upon the appointment of any successor Trustee, all
rights, titles, duties, powers and authority of the predecessor Trustee
hereunder shall be vested in and undertaken by the successor Trustee without any
further act. No successor Trustee shall be liable personally for any act or
omission of his predecessor.
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4.4 Liability of Trustees. No Trustee shall be liable to the Trust or
to any beneficiary thereof except for his own gross negligence or willful
misconduct. No Trustee shall be liable for any act or omission-of any officer,
agent or employee of the Trust unless such Trustee acted with gross negligence
or willful misconduct in the selection or retention of such officer, agent or
employee.
4.5 Compensation and Expenses of Trustees.
(a) Each of the Trustees shall receive compensation for his or her
services as Trustee in the amount of $30,000 per annum. The Managing Trustee
shall receive an additional compensation of $20,000 per annum. The Trustees
shall also receive $1000 per diem for meetings of the Trust attended by such
Trustee and other Trust business. All such amounts shall be increased or
decreased annually at the rate of the Consumer Price Index for urban wage
earners and clerical workers (U.S. City Average) unadjusted for seasonal
variation, published by the Bureau of Labor Statistics of the United States
Department of Labor.
(b) All properly documented reasonable out-of-pocket costs and expenses
incurred by the Trustees in connection with the performance of their duties
hereunder shall be promptly reimbursed by the Trust.
4.6 Indemnification of Trustees and Others.
(a) The Trustees shall be indemnified by the Trust to the fullest
extent that a corporation or a trust organized under New York law is from time
to time entitled to indemnify its directors against any and all liabilities,
expenses, claims, damages or losses incurred by them in the performance of their
duties hereunder. Additionally, each member of the TAC (collectively,
"Additional Indemnitees") who was or is a party, or is threatened to be made a
party to any threatened, pending or completed action, suit or proceeding of any
kind, whether civil, administrative or arbitrative, by reason of any act or
omission of such Additional Indemnitees with respect to (i) the liquidation of
any Claims, (ii) the administration of the Trust and the implementation of the
Procedures, (iii) the prosecution of the Causes of Action, and (iv) any action
provided for in this agreement, shall be indemnified and defended by the Trust
against expenses, costs and fees (including attorneys' fees), judgments, awards,
costs, amounts paid in settlement, and liabilities of all kinds incurred by each
Additional Indemnitee in connection with or resulting from such action suit, or
proceeding, unless there is a final determination of a Court with jurisdiction
that such Additional Indemnitee acted other than in good faith and in a manner
such Additional Indemnitee reasonably believed to be in, or not opposed to, the
best interests of the holders of Claims and Demands.
(b) Reasonable expenses, costs and fees (including attorneys' fees)
incurred by or on behalf of a Trustee or Additional Indemnitee in connection
with any action, suit, or proceeding, whether civil, administrative or
arbitrative from which they are indemnified by the Trust pursuant to this
Section 4.6, may be paid by the Trust in advance of the final disposition.
(c) The Trustees shall have the power, generally or in specific cases,
to cause the Trust to indemnify the employees and agents of the Trust to the
same extent as provided in this Section 4.6 with respect to the Trustees.
(d) To the extent any indemnification under Section 4.6 of this
Agreement with respect to an action, suit, or proceeding requires a
determination that indemnification is proper in the circumstances, such
determination shall be made by the Trustee or Trustees who were not parties to
such action, suit, or proceeding, if at least one such Trustee was or is not a
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party; otherwise, the determination as to each Trustee will be made by the
remaining Trustee or Trustees, regardless of whether or not he, she or they were
or are parties.
(e) The Trustee may purchase and maintain reasonable amounts and types
of insurance on behalf of any individual who is or was a Trustee, officer,
employee, agent or representative of the Trust or Additional Indemnitee against
liability asserted against or incurred by such individual in that capacity or
arising from his or her status as a Trustee, member of the TAC, officer,
employee, agent, professional advisor or representative thereof.
4.7 Trustees' Lien. The Trustees shall have a prior lien upon the Trust
Assets to secure the payment of any amounts payable to them pursuant to Sections
4.5 and 4.6.
4.8 Trustees' Employment of Advisors. The Trustees may, but shall not
be required to, consult with counsel, accountants, appraisers, other
professionals or advisors and other parties deemed by the Trustees to be
qualified as experts on the matters submitted to them (regardless of whether any
such party is an affiliated party of any Trustee or is otherwise affiliated with
any of the Trustees in any manner, except as otherwise expressly provided for in
this Trust Agreement) and the advice of any such parties on any matters
submitted to them by the Trustees shall be full and complete authorization and
protection in respect of any action taken or not taken by the Trustees hereunder
in good faith and in accordance with the advice of any such party.
4.9 Additional Qualifications.
(a) No Trustee or related party of a Trustee shall represent or shall
have represented the Trustor or any Entity who asserts or has asserted a Claim
against Keene Corporation.
(b) No Trustee shall own any securities of Keene Corporation, New Keene
or any of its affiliates or have any other financial interest, direct or
indirect, in the Keene Corporation, New Keene, or any of its affiliates.
(c) If there has been a violation of Subsection (a) or (b), above, the
Trustee involved shall be subject to removal pursuant to Section 4.2(d), above.
4.10 Trustees' Service As Director of Reorganized Keene. No Trustee is
prohibited from serving as a director of New Keene. If any Trustee serves as a
director of New Keene, he or she shall not receive compensation for such service
over and above the compensation received as a Trustee under Section 4.5 but
shall receive a per diem allowance in the amount that New Keene pays its
directors for their attendance at meetings.
4.11 Bond. Notwithstanding any state law to the contrary each Trustee
(including any successor trustee) shall be exempt from giving any bond or
security in any jurisdiction.
ARTICLE V
THE TRUSTEE ADVISORY COMMITTEE
5.1 Duties. a. Consultation. The Trustee shall consult with the TAC and
the TAC shall assist the Trustees in the implementation of the Trust and the
Procedures generally by providing consulting services with respect to material
issues affecting the Trust including, but not limited to, implementation of
Procedures, development of payment rules, forms and procedures, releases, time
frames and other matters specified herein and in the Procedures. Where
consultation is required under the Trust or the Procedures, the Trustees need
only seek advice and counsel from the TAC.
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b. Consent. The Trustees shall be obligated to obtain the consent of
the TAC in writing in order to (1) implement material changes in any Claims
Resolution Procedures; (2) dismiss, settle or abandon Transaction Lawsuit and
Bairnco Lawsuit; (3) associate with another claims facility; (4) amend any
provision of the Trust Agreement; (5) effect termination of this Trust pursuant
to Sections 6.2(a) (i), (ii), or (iii); (6) select a successor Trustee during
the Initial Term, and (7) determine the Litigation Reserve. The TAC shall not
unreasonably withhold any consent required hereunder.
c. Court approval. Any proposed action or decision of the Trustees for
which the consent of the TAC is required as to which the TAC withholds consent
may be taken only upon Court approval after reasonable notice to each member of
the TAC.
5.2 Procedures. With respect to any matter relating to the Trust as to
which the consultation or consent of the TAC is expressly required, the Trust
shall:
(i) provide the TAC reasonable access to the relevant documents,
records and reports and to experts and advisors retained by the Trust
and to the Trust staff during such time as the decision is being
considered;
(ii) bring the proposed decision to the attention of the TAC; and
(iii) provide the TAC with no fewer than 30 days to comment with
respect to the proposed decision, unless the TAC agrees to a shorter
period.
5.3 Number; Chairperson
(a) At the commencement of the Trust, there shall be three members of
the TAC (the "Initial TAC Members") who shall serve until the expiration of the
Initial TAC Term defined below in Section 5.4. The Initial TAC Members shall be
selected by the Committee pursuant to the Plan.
(b) There shall be a chairperson of the TAC selected by the Initial TAC
Members. The chairperson shall act as the TAC's liaison, shall coordinate and
schedule meetings of the TAC and shall handle all administrative matters that
come before the TAC.
(c) After expiration of the Initial TAC Term, the Chairperson of the
TAC, plus one other member of the TAC selected by the Initial TAC Members, shall
serve until the termination of the Trust or his or her death, incapacity,
resignation or removal and in such event, the remaining member shall serve as
the sole TAC member.
5.4 Term. (a) The Initial TAC Members shall serve for a period of three
years (the "Initial TAC Term") subject to any member's earlier death,
incapacity, removal or resignation.
(b) Any member of the TAC may resign at any time by at least 30 days
written notice to each of the remaining members specifying the date when such
resignation shall take place.
(c) A member of the TAC may be removed from office by the unanimous
vote of the remaining members of the TAC and a determination of the Bankruptcy
Court that such removal is appropriate upon cause shown.
5.5 Successors. In the event of a vacancy in the membership of the TAC
during the Initial TAC Term, the vacancy shall be filled by the unanimous vote
of the remaining Initial TAC Members.
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108
5.6 Quorum. The presence of two members during the Initial TAC Term and
so long as there are two members serving shall constitute a quorum of the TAC
for the transaction of business. In the absence of a quorum, the members present
may adjourn the meeting from time to time without notice. In order for the
Trustees to obtain consent of the TAC with respect to actions listed in Section
5.1 hereof and otherwise specified in this Agreement, the TAC must approve the
Trustees' recommendation by a majority unless otherwise specified herein.
5.7 TAC's Employment of Advisors. The TAC may, but shall not be
required to, consult with counsel, accountants, appraisers, advisors and other
parties on the matters submitted to them (regardless of whether any such party
is an affiliated party of any member of the TAC or is otherwise affiliated with
any of the TAC in any manner, except as otherwise expressly provided in this
Trust Agreement) and the advice of any such parties on any matters submitted to
them by the TAC shall be full and complete authorization and protection in
respect of any action taken or not taken by the TAC hereunder in good faith and
in accordance with the advice of any such party.
5.8 Compensation and Expenses of Members of the TAC and their advisors.
The Chairperson of the TAC shall receive $25,000 as compensation for his or her
service plus $1,000 per diem. Each member of the TAC shall receive compensation
for his or her services as a member in the amount of $20,000 per annum plus
$1,000 per diem for meetings of the TAC. All properly documented, reasonable
out-of-pocket costs and expenses incurred by the TAC members in connection with
the performance of their duties hereunder will be promptly reimbursed by the
Trust.
5.9 Liability of TAC. No member of the TAC shall be liable to the Trust
or to any beneficiary thereof except for his or her own gross negligence or
willful misconduct. No member of the TAC shall be liable for any act or omission
of any member, advisor, agent or employee of the TAC unless the TAC acted with
gross negligence or willful misconduct in the selection or retention of such
member, advisor, agent or employee.
ARTICLE VI
GENERAL PROVISIONS
6.1 Irrevocability. The Trust is irrevocable, but this agreement is
subject to amendment as provided herein.
6.2 Termination.
(a) The Trust shall terminate on the date (the "Termination Date") that
is 90 days after the first occurrence of any of the following:
(i) the Trustees in their sole discretion decide to terminate the
Trust because (A) they deem it unlikely that new Asbestos Related
Claims or Demands will be filed against the Trust and (B) all Asbestos
Related Claims duly filed with the Trust have been liquidated and
satisfied and twelve consecutive months have elapsed during which no
new Asbestos Related Claim has been filed with the Trust;
(ii) the date on which the Bankruptcy Court order becomes final
which has approved the arrangements the Trustees have made to
establish Claims handling agreements and other necessary arrangements
with suitable third parties adequate to discharge all expected
remaining obligations and expenses of the Trust in a manner consistent
with this Trust Agreement and the Procedures;
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109
(iii) if in the judgment of the Trustees, the continued
administration of the Trust is uneconomic or inimical to the best
interests of the persons holding Asbestos Related Claims and Demands
and the Trustees have obtained an order of the Court that the
termination of the Trust will not expose or subject New Keene or any
successor in interest to any increased or undue risk of having any
Asbestos Related Claims and Demands asserted against it or them or in
any way jeopardize the validity or enforceability of the Permanent
Channeling Injunction; or
(iv) 21 years less 91 days after the death of the last survivor
of all the descendants of Joseph P. Kennedy, Sr. of Massachusetts
living on the date hereof.
(b) On the Termination Date, after payment of all the Trust's
liabilities has been provided for, all funds remaining in the Trust estate shall
be transferred to charitable organization(s) selected by the Trustees using
their reasonable discretion; provided, however, that (i) if practicable, the
charitable organization(s) shall be related to the treatment, research, or the
relief of suffering of individuals suffering from asbestos disorders, and (ii)
the tax-exempt organization(s) shall not bear any relationship to New Keene.
(c) As soon as practicable after the Termination Date, the Trustee
shall (i) certify to the Court that all conditions precedent to the Termination
Date have been satisfied and (ii) file a final accounting and serve a copy on
the TAC and the Trustor. Thereupon, the Trust shall be dissolved and the
Trustee(s) and the TAC discharged.
6.3 Amendments. This Trust Agreement may be amended, modified and/or
supplemented by unanimous vote of the Trustees only with the consent of the TAC.
6.4 Cooperation. New Keene and the Trust shall each cooperate to the
extent reasonably requested by the other in the handling of Asbestos-Related
Claims and Demands and the prosecution of the Causes of Action and generally in
the operation of the Trust for the purposes set forth herein. New Keene shall
transfer to the Trust such claim files and other documents related to the
Asbestos Related Claims as are under its custody or control, and shall use its
best efforts to make available its present or former officers, directors,
employees, agents or representatives to the extent the Trust deems such persons
necessary to appear at any trial or arbitration proceeding related to the
liquidation of the Asbestos Related Claims. To the extent the valuation of any
assets of the Trust are necessary for the tax returns of New Keene, (a) the
Trust shall provide New Keene with such valuation and (b) New Keene shall use
such valuation in its tax returns.
6.5 Severability. Should any provision in this Trust Agreement be
determined to be unenforceable, such determination shall in no way limit or
affect the enforceability and operative effect of any and all other provisions
of this Trust Agreement.
6.6 Notices. Notices to claimants shall be given at the address of such
claimants, or, where applicable, such claimants' Attorney of Record, in each
case as provided on such claimant Claim forms. Any notices or other
communications required or permitted hereunder shall be in writing and delivered
at the addresses designated below, or sent by telex or telecopy pursuant to the
instructions listed below, or mailed by registered or certified mail, return
receipt requested, postage prepaid, addressed as follows, or to such other
addresses as may hereafter be furnished by New Keene to the Trustees and the TAC
or by the Trustees and the TAC to New Keene in compliance with the terms hereof.
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110
To the Trust or the Trustees:
Mr. Archie R. Dykes
Capital City Holdings Inc.
Rivergate Executive Park
907 Two Mile Parkway
Suite D-5
Goodlettsville, TN 37072
Richard A. Lippe, Esq.
Meltzer, Lippe, Goldstein, Wolf,
Schlissel & Sazer
The Chancery
190 Willis Avenue
Mineola, NY 11501
Mr. John J. Robbins
112 Walton Heath
Williamsburg, VA 23188
With a copy to:
George A. Davidson, Esq.
Hughes Hubbard & Reed LLP
One Battery Park Plaza
New York, NY 10004
To New Keene:
- ------------------------------------
- ------------------------------------
with a copy to:
- ------------------------------------
- ------------------------------------
To the TAC:
Stanley J. Levy, Esq.
Levy Phillips & Kongisberg
90 Park Avenue
New York, NY 10016
Charles F. Vihon, Esq.
Much Shelist Freed Denenberg
& Ament
200 North LaSalle Street
Suite 2100
Chicago, IL 60601-1095
Perry Weitz, Esq.
Weitz & Luxenberg
40 Fulton Street
New York, NY 10038
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111
All such notices and communications shall be effective when delivered
at the designated addresses or when the telex or telecopy communication is
received at the designated addresses and confirmed by the recipient by return
telex or telecopy in conformity with the provisions hereof.
6.7 Counterparts. This Trust Agreement may be executed in any number of
counterparts, each of which shall constitute an original, but such counterparts
shall together constitute but one and the same instrument.
6.8 Successors and Assigns. The provisions of this Trust Agreement
shall be binding upon and inure to the benefit of the Trustors, the Trust, the
Trustees and the TAC and their respective successors and assigns, except that
neither the Trustor nor the Trust, nor any Trustee, nor any member of the TAC
may assign or otherwise transfer any of its or his or her rights or obligations
under this Trust Agreement except as provided for in this Trust Agreement.
6.9 Entire Agreement; No Waiver. The entire agreement of the parties
relating to the subject matter of this Trust Agreement is contained herein, and
this Trust Agreement supersedes any prior oral or written agreements concerning
the subject matter hereof. No failure to exercise or delay in exercising any
right, power or privilege hereunder shall operate as a waiver thereof, nor shall
any single or partial exercise of any right, power or privilege hereunder
preclude any further exercise thereof of any other right, power or privilege.
The rights and remedies herein provided are cumulative and are not exclusive of
rights under law or in equity.
6.10 Headings. The headings used in this Trust Agreement are inserted
for convenience only and neither constitute a portion of this Trust Agreement
nor in any manner affect the construction of the provisions of this Trust
Agreement.
6.11 Governing Law. This Trust Agreement shall be governed by, and
construed in accordance with, the laws of the State of New York without giving
effect to principles of conflicts of law.
6.12 Dispute Resolution. Any disputes which arise under this Agreement
with respect to interpretation and implementation shall be resolved by the
Bankruptcy Court.
IN WITNESS WHEREOF, the Trustor has caused this Trust Agreement to be
executed by a duly authorized officer of representative of the Trustor and
attested by another duly authorized officer of the Trustor and the Trustees and
New Keene have each executed this Trust Agreement, all as of the day and year
first above written.
KEENE CORPORATION
By:-----------------------------------------
Name:
Attest:
By:-----------------------------------------
Name:
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112
--------------------------------, as Trustee
Archie R. Dykes
--------------------------------, as Trustee
Richard A. Lippe
--------------------------------, as Trustee
John J. Robbins
NEW KEENE
By:-----------------------------------------
Name:
Attest:
By:-----------------------------------------
Name:
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EXHIBIT E
TO
THE PLAN
Asbestos-Related Claims Resolution
and Distribution Procedures
<PAGE>
114
ASBESTOS IN BUILDINGS CLAIMS RESOLUTION PROCEDURES
I. INTRODUCTION.
These Asbestos In Buildings Claims Resolution Procedures (the "AIB
Procedures") are designed to evaluate, liquidate, pay and dispose of the
Asbestos in Buildings Claims ("AIB Claims") asserted against the Keene
Corporation ("Keene") in a non-litigated, low-transaction-cost manner pursuant
to Keene's Plan of Reorganization (the "Plan") and the Trust Agreement.(1)
The Procedures shall provide the exclusive method for disposition and
payment of AIB Claims. The goal is to provide fair payment to all claimants with
valid AIB Claims, taking into account the resources available to the Trust for
this purpose. As such, the AIB Procedures pertain only and are unique to the
Keene Chapter 11 Case and have no applicability on any other basis and are not
relevant to any litigation or other disputed proceeding.
The Procedures may be interpreted by the Trustees only where an
ambiguity exists. That interpretation shall be consistent with the purpose of
providing payment for cost-effective, reasonable methods of Abatement (as
hereinafter defined) of asbestos-containing materials. The Trustees shall
consider duties imposed on claimants in the future by applicable law or
regulation so as to insure that there is no inequity, unfairness, or unjust
enrichment resulting from the implementation of these AIB Procedures.
Claimants may, but need not, be represented by counsel during any of
the activities under these AIB Procedures.
II. DEFINITIONS.
1. Abatement: "Abatement" shall mean and refer to the removal,
enclosure, encapsulation or repair of ACM.
2. Abatement Costs: "Abatement Costs" shall mean and refer to the
reasonable costs of past and future Abatement, including, by way of
example, costs for the Abatement itself, design, consultant and laboratory
fees and other costs in connection with the Abatement, on-site monitoring,
insurance costs, disposal costs, and, except for Abatement upon demolition,
the reasonable costs of replacement of ACM with a non-asbestos material.
3. ACM: "ACM" shall mean and refer to any material or product
containing more than 1% asbestos by weight.
4. ACM Surface Treatments: "ACM Surface Treatments" shall mean and
refer to Keene's brands of ceiling tile containing amosite and a perforated
asbestos-cement board used for acoustical treatment, "Monospray" and
"Pyrospray".
5. ACM TSI: "ACM TSI" shall mean and refer to ACM that is applied to
pipes, fittings, boilers, breeching, tanks, ducts or other interior
structural components to prevent heat loss or gain or water or condensation
for other purposes, such as pipe covering, insulation block and insulating
and finishing cements.
6. Allowed Costs: "Allowed Costs" shall mean and refer to Abatement
Costs which are eligible for payment under these Procedures. Allowed Costs
do not include costs for surveys or operations and maintenance.
7. Applicable Jurisdiction: "Applicable Jurisdiction" shall mean and
refer to the jurisdiction whose laws may be the basis for determining
whether a Claimant has provided Reasonable Evidence, where required by
these procedures.
8. Approved Laboratory: "Approved Laboratory" shall mean and refer to
a laboratory which is competent to perform constituent analysis of bulk
samples of ACM.
- ---------------------
(1) All capitalized terms herein shall have the meaning provided for them in
the Plan or the Trust, unless the context clearly indicates otherwise.
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115
9. Asbestos: "Asbestos" shall mean and refer to chrysotile, amosite,
crocidolite, tremolite asbestos, anthophyllite asbestos, actinolite
asbestos and any of these minerals that have been chemically treated and/or
altered.
10. Asbestos Coordinator: "Asbestos Coordinator" shall mean and refer
to a Claimant's employee who has primary responsibility for asbestos
Abatement and control activities.
11. Category 1 Fund: "Category 1 Fund" shall mean and refer to the
total consideration allocated for payment of Category 1 Claims.
12. Category 2 Fund: "Category 2 Fund" shall mean and refer to the
total consideration allocated for payment of Category 2 Claims.
13. Claimant: "Claimant" shall mean and refer to the owner or operator
of one or more buildings as to which a proof of claim has been filed, or to
the duly authorized legal agent thereof.
14. Cost Model: "Cost Model" shall mean and refer to estimated past or
future Abatement Costs based upon the reasonable abatement cost for the
subject type of ACM as set forth in an appropriate model developed by the
Trustees with the advice and concurrence of the TAC.
15. Demolition: "Demolition" shall mean and refer to the deliberate
destruction of a building or a part thereof, or a building system or
component thereof, for any purpose by its owner or operator, by those
acting for or on behalf of the owner or operator, or by a government
agency, undertaken in whole or in principal part for reasons not related to
asbestos management or control or Abatement.
16. Disallowed Claims: "Disallowed Claims" shall mean and refer to
those Claims which are determined not to qualify for payment under the
Procedures.
17. Future Allowed Costs: "Future Allowed Costs" shall mean and refer
to estimated Abatement Costs to be incurred based upon the Cost Model.
Future Allowed Costs may include the Abatement Costs for removal of
previously encapsulated or enclosed ACM.
18. Homogeneous Area: "Homogeneous Area" shall mean and refer to a
section of ACM installed within one construction phase of a building that
appears uniform in color, texture and appearance.
19. Keene ACM: "Keene ACM" shall mean and refer to ACM designed,
mined, manufactured, sold or distributed by Keene, or for which Keene may
be otherwise responsible under the laws of one of the Applicable
Jurisdictions, including, but not limited to, ACM containing Keene
asbestos.
20. Past Allowed Costs: "Past Allowed Costs" shall mean and refer to
the lesser of Abatement Costs actually incurred prior to the Confirmation
Date or those based upon application of the Cost Model.
21. Principal ACM: "Principal ACM" shall mean and refer to the primary
types of ACM which Keene, mined, manufactured, distributed or sold, to wit:
sprayed mineral fiber materials containing a mixture of mineral wool,
asbestos and binders; ceiling tiles; and ACM TSI.
22. Reasonable Evidence: "Reasonable Evidence" shall mean and refer to
evidence sufficient to present a jury issue under the tort system of one of
the Applicable Jurisdictions.
23. Removal: "Removal" shall mean and refer to the physical removal of
ACM from a building and disposal thereof in accordance with all applicable
regulations.
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116
24. Renovation: "Renovation" shall mean and refer to the removal,
replacement, substitution, alteration or modification of a building or any
internal or external building surface, system, component or material,
undertaken in whole or in principal part for reasons not related to
asbestos management, control or Abatement.
III. ALLOWANCE OF AIB CLAIMS.
A. Categories of AIB Claims.
1. Category 1. Category 1 shall include all AIB Claims for which
Claimants provide either Reasonable Evidence or a final, non appealable
judgment that the ACM is Keene ACM.
2. Category 2. Any Claimant may agree to accept, from the Category 2
Fund only, its pro rata share thereof on account of its AIB Claim with
respect to Principal ACM. Claimants who elect to be paid from the Category
2 Fund will not receive any other payment on account of the type of ACM for
which payment is being received from the Category 2 Fund.
3. There shall be two sub-categories within each of the above
Categories 1 and 2, as follows:
a. sub-category (a) shall include all AIB Claims for Past Allowed
Costs; and
b. sub-category (b) shall include all AIB Claims for Future
Allowed Costs.
B. Allowed Amounts.
1. Each Category 1(a) Claim will be allowed in the amount supported by
Reasonable Evidence.
2. Each Category 1(b) Claim will be allowed to the extent of 75% of
the amount supported by Reasonable Evidence.
3. Each Category 2(a) Claim will be allowed to the extent of 50% of
the amount of Past Allowed Costs.
4. Each Category 2(b) Claim will be allowed to the extent of 25% of
the amount of Future Allowed Costs.
C. Disallowed Claims. The Trustees shall disallow any Claim:
1. for which a timely AIB Claim Form (defined below) has not been
filed;
2. for punitive and/or enhanced damages; and
3. which is subject to a final judicial order or a stipulation which
determines or recognizes that the ACM (for which the AIB is filed herein)
is that of a specific, identified entity other than Keene.
D. Payment of Claims.
1. The Trustees shall process all AIB Claims as soon as possible
beginning not later than one year after the Effective Date.
2. The Allowed Amounts of all Category 1 Claims shall be paid pro rata
from the Category 1 Fund, but in no event shall any Claimant receive more
than 100% of such Allowed Amount.
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117
3. The Allowed Amounts of all Category 2 Claims shall be paid pro rata
from the Category 2 Fund, but in no event shall any Claimant receive more
than 100% of such Allowed Amount.
4. Any funds remaining in the Category 2 Fund after payment of the
Category 2 Claims shall be transferred to the Category 1 Fund.
5. Any funds remaining in the Category 1 Fund after payment of the
Category 1 Claims shall be transferred to the Category 2 Fund if Category 2
Claimants received (or will receive) less than 100% of the Allowed Amount
of their Claims; otherwise, all funds remaining in the Category 1 Fund
shall be used by the Trustees to pay Personal Injury Claims.
E. Documentation.
Except as otherwise may be provided for herein, no AIB Claim shall be
Allowed unless the documentation required below is submitted to the Trustees in
support of the Claim. Such documentation must be sufficient to constitute
Reasonable Evidence, where such is required. In and of itself, the absence of
one or more type of document shall not be the basis for disallowance of an AIB
Claim. Documents not provided may be substituted for by a certification by the
Claimant that, despite reasonable efforts to do so, the required material could
not be located. In such case, alternative Reasonable Evidence shall be accepted.
1. Category 1 Claims.
a. Description of the location, type and amount of the Keene ACM,
including a certification of the accuracy of the information.
b. Copies of all presently existing bulk sample analysis results
and/or records thereof showing that the material contained asbestos
(The bulk sample analysis technique must be polarized light microscopy
or another of the generally acceptable methods, including those
acceptable to the United States Environmental Protection Agency. A
minimum of one sample from each Homogeneous Area for which Abatement
Costs are claimed must have been analyzed.) and that the material was
a Homogeneous Area.
c. Reasonable Evidence that the ACM which is the subject of the
AIB Claim is Keene ACM, such as:
(1) constituent analysis of representative bulk samples from
a Homogeneous Area; or
(2) a sworn affidavit of an individual with personal
knowledge that the material installed in the Homogeneous Area was
Keene ACM and the factual basis for that conclusion; or
(3) sales invoices, purchase orders, architectural
specifications and records, bid documents, contracts and
subcontracts, change orders, material approvals, maintenance,
repair and renovation records, complaints to contractors,
installation records, advertisements, insurance claims, supplier
records, documents from discovery in lawsuits and Keene records;
and
(4) the following, if available,
(a) copy of the report of a qualified industrial or
occupational hygienist, qualified engineer, qualified
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118
consultant, qualified contractor or Claimant's qualified
asbestos coordinator describing the type, location and
quantity of ACM, and type and scope of Abatement work
performed or to be performed,
(b) copies of receipted bills, or vouchers or other
proof of Abatement Costs,
(c) copies of bid specifications and contracts for all
Abatement work performed or to be performed by persons other
than the Claimant's employees,
(d) copies of all special insurance policies purchased
by Claimant to cover Abatement work risks or copies of
receipted bills, vouchers or other proof of special
insurance, and
(e) with respect to Abatement work performed by
Claimant's employees, copies of personnel contracts or other
proof of the salary of Claimant's employees and the number
of hours spent by them on Abatement activities, including a
breakdown of those activities.
2. Category 2 Claims.
a. Description of the location, type and amount of the Principal
ACM, including a certification of the accuracy of the information.
b. Copies of all presently existing bulk sample analysis results
and/or records thereof showing that the abated material contained
asbestos, pursuant to paragraph 1.b., above.
c. To the extent it exists, the documentation identified in
paragraph 1.c.(4), above.
IV. REVIEW AND PROCESSING OF CLAIMS.
A. Submission of Claims.
All AIB Claims shall be submitted on a Standardized Claim Form to be
prepared by the Trustees (the "AIB Claim Form"). All AIB Claims must be
submitted no later than two years after the Effective Date.
The Trustees may establish procedures designed to minimize
administrative costs but they must not prejudice Claimants' substantive rights.
The Trustees also may establish guidelines to prevent abuse of the objective of
providing for cost-effective and reasonable methods of asbestos Abatement and
control; these also must not prejudice Claimants' substantive rights and may not
be inconsistent with these Procedures.
B. Review of Claims.
Upon receipt of a AIB Claim Form, the Trustees shall review it to
determine whether the necessary documentation has been included. If additional
documentation is required, the Trustees, by overnight (second day service) or
facsimile mail, shall so notify the Claimant. Any AIB Claim requiring additional
documentation as to which such additional documentation is not provided within
60 days from the date of such notification, or within such additional time as
may be granted by the Trustees (but which, in no event, shall exceed 30 days),
shall be Disallowed, provided that the Claimant shall have the right to request
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119
reconsideration and ultimately Binding Dispute Resolution as defined below.
Nothing herein shall preclude the Claimant and the Trustees from engaging in any
informal discussion or exchange of documents prior to the Trustees' official
determination of the Claim.
Once all necessary documentation has been received, the Trustees will
determine whether and to what extent the AIB Claim will be Allowed. Within 120
days of receipt of all necessary documentation, by overnight (second day
service) or facsimile mail, the Trustees shall notify the Claimant of their
determination.
The Trustees shall have the right, upon reasonable notice to the
Claimant, to inspect Claimant's building(s) or structure(s) and conduct
non-invasive or non-destructive tests reasonably necessary for the evaluation of
the AIB. Such inspection and/or testing shall be done at times convenient to the
Claimant and in accordance with all applicable federal, state and local rules or
regulations regarding safe practices and the Claimant's operations and
maintenance program, if any. Unless the Claimant agrees otherwise, inspection or
testing shall not extend the period within which the Trustees must determine the
allowability of the AIB Claim. For purposes of this section, the requirement
that any testing by the Trustees be non-invasive or non-destructive shall not
preclude securing bulk samples provided, however, that the sampling must be
conducted in accordance with all applicable federal, state and local rules or
regulations regarding safe practices and the Claimant's operations and
maintenance program, if any, and the Trustees shall repair and restore the
location from which the sample is taken to the extent of the "damage" done on
account of such testing or sampling.
Determination of the Allowability of an AIB Claim shall also include a
specification of the dollar amount of Allowed Costs. However, the Allowed Amount
of the AIB Claim may not be greater than the appropriate percentage of
reasonable and customary costs for the action taken under the circumstances. If
the Allowed Amount is less than that sought by the Claimant for any reason, the
Trustees shall state the reason for their determination, provide copies of all
reports of any inspection and/or testing and fully discuss the Claimant's right
to request reconsideration and Binding Dispute Resolution.
C. Reconsideration of Claim.
A Claimant shall have 60 days from the time it receives the Trustees'
determination of Allowance/Disallowance to file a written request for
reconsideration of that determination. The Claimant must state in writing the
reason(s) for seeking reconsideration and include any materials not theretofore
submitted which the Claimant wishes to be considered in connection with the
reconsideration.
Once the Trustees have received the request for reconsideration, they
shall review it, all supporting documentation, the Claimant's reason for seeking
reconsideration and any other relevant material. The review shall be conducted
de novo by a panel consisting of a Trustee, a claims analyst and a disinterested
member of the TAC. (The claims analyst who made the original determination shall
not sit on the reconsideration panel.) The panel shall have 90 days from the
date the Trustees received Claimant's request for reconsideration to decide the
matter. If no final decision is issued within said 90-day time period, the AIB
Claim shall be Allowed as originally submitted.
The reconsideration panel's decision shall be given the Claimant in
writing; it shall specify the amount of the Allowed Costs. If the Allowed Costs
decided upon by the reconsideration panel are less than the appropriate
percentage of the amount of the Claim as originally filed by the Claimant or the
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AIB Claim is Disallowed in whole or in part, the panel's decision shall be fully
detailed and shall also contain a discussion of the Claimant's right to request
Binding Dispute Resolution.
D. Binding Dispute Resolution.
The Claimant may request that a reconsideration panel's decision which
denies the AIB Claim in whole or in part be submitted to an arbitrator for
Binding Dispute Resolution. The Claimant shall have 60 days from the date it
receives the reconsideration panel's decision to file with the Trustees a
written request for Binding Dispute Resolution.
The Trustees shall maintain a list of not less than 15 independent
arbitrators who are available to conduct Binding Dispute Resolution. Once a
request for Binding Dispute Resolution is received by the Trustees, within 10
days of their receipt of such request they shall send to the Claimant the names
and addresses of 10 independent arbitrators selected at random from their list
by the Trustees. Claimant shall have 30 days from the date the list is received
to strike from the list five arbitrators and to return to the Trustees the list
of the five remaining arbitrators.
Once the Trustees have received the Claimant's list of five
arbitrators, they shall select one from that list and arrange with that
arbitrator a date and location for Binding Dispute Resolution to commence. The
Binding Dispute Resolution shall be commenced within 90 days of the date the
Trustees received the Claimant's choice of arbitrators. When the date and
location that Binding Dispute Resolution is to take place have been determined,
the Trustees shall notify the Claimant in writing of that along with the
identity of the arbitrator.
The arbitrator shall review the AIB Claim de novo pursuant to the
standards set forth in these Procedures. In no event may an arbitrator Allow an
AIB Claim in an amount less than that decided upon by the reconsideration panel,
unless the arbitrator determines that the claim is not Allowable. The Trust
shall pay the arbitrator's fees, provided, however, that, in the event Claimant
fails to obtain an award in an amount equal to or greater than 125% of the
reconsideration panel's final determination, such fees and expenses shall be
borne by the Claimant.
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KEENE ASBESTOS RELATED PERSONAL INJURY CLAIMS
RESOLUTION AND DISTRIBUTION PROCEDURES
These Keene Asbestos Related Personal Injury Claims Resolution and
Distribution Procedures (the "Asbestos Claims Procedures") have been prepared in
connection with the Plan of Reorganization (the "Plan") of Keene Corporation
("Keene") confirmed by order of the United States Bankruptcy Court for the
Southern District of New York (The "Court"), dated , 1996 and the Keene
Creditors Trust Agreement (the "Trust Agreement") filed with the Plan.
These Asbestos Claims Procedures provide for processing, liquidating,
paying and satisfying all Asbestos Personal Injury Claims and all asbestos
related Contribution and Indemnity Claims ("Contribution and Indemnity Claims")
arising as a result of exposure to asbestos materials manufactured and/or sold
by Keene as provided in and required by the Plan and the Trust Agreement. The
Trust (the "Trust") shall implement and administer these Asbestos Claims
Procedures in accordance with the Trust Agreement.
SECTION I.
DEFINITIONS
1.1______Defined Terms. Capitalized terms used herein and not otherwise
defined herein or below shall have the meanings assigned to them in the Trust
Agreement or the Plan.
(1) "Claim" means either a Claim or a Demand as those terms are
defined in the Plan.
SECTION II.
PURPOSE, OVERVIEW AND INTERPRETATION
2.1 Purpose. These Asbestos Claims Procedures are adopted pursuant
to and in connection with the Trust Agreement and are designed to provide
payment to holders of Keene Asbestos Related Personal Injury Claims ("Personal
Injury Claims") in such a way that holders of similar Personal Injury Claims are
paid in a substantially similar manner.
2.2 Overview. The process for determining the amount to be offered
for a valid Personal Injury Claim will be based on the claimant establishing
that the Claim meets the criteria for one of five Scheduled
Diseases--Mesothelioma, Lung Cancer, Other Cancer, Asbestos Lung Disease,
Category 1 and Asbestos Lung Disease, Category 2, as later defined in Section
5.2.
In general, each claimant who the Trust determines meets the criteria
for payment will be offered the established percentage of the Scheduled Disease
Amount for the disease category applicable to that claimant and payment will be
made from one of the two Funds established by the Trust pursuant to Section VI.
If the claimant rejects the Trust's offer of the established percentage
of the Scheduled Disease Amount, the claimant may elect to have the validity and
amount of his or her Claim determined by the tort system. Valid Contribution and
Indemnity Claims also will be resolved in a manner provided for in these
Asbestos Claims Procedures.
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2.3 Interpretation. Nothing in these Asbestos Claims Procedures
shall be deemed to create a substantive right for any claimant. These Asbestos
Claims Procedures are procedural, and they may be amended, deleted or added to
pursuant to the terms of the Trust Agreement and the terms of these Asbestos
Claims Procedures.
SECTION III.
PAYMENT PERCENTAGE; PERIODIC ESTIMATES
3.1 General. The Trust will pay holders of valid Claims of asbestos
related diseases caused by Keene products, from the Trust Assets only, the
percentage of each Claim's Scheduled Value (the "Payment Percentage") as
determined by the Trustee pursuant to this Section III, in full satisfaction of
each Claim and consistent with the objective of paying holders of similar Claims
in a substantially similar manner.
There is substantial uncertainty regarding Keene's total liability to
present and future Keene Personal Injury claimants, the total value of the
Trust's assets, whether those assets will be sufficient to pay all Personal
Injury Claims and when any such assets will be available. Prior to making any
distributions to claimants the Trust must, consistent with Sections 3.2(a) and
(b) of the Trust Agreement, make a determination of the aggregate Scheduled
Value of present and foreseeable future asbestos claims, of the cash available
for distributions, and of such other factors necessary to determine the Payment
Percentage of each claim that the Trust can afford to pay to holders of Personal
Injury Claims. Subject to Sections 3.2 and 3.3 below, the Trust shall pay the
Payment Percentage of the Scheduled Value of each claim allowed under these
procedures.
3.2 Adjustment of Payment Percentage.
(a) Consistent with the Trust Agreement, and subject to Section 3.2(c)
below, the Trust may evaluate and change the Payment Percentage. Any such
evaluation shall be performed in a flexible and pragmatic manner that takes into
account the relevant circumstances, including the practical limitations imposed
by the inability to predict with precision the future assets and liabilities of
the Trust, the costs involved in preparing such evaluations, and any other
factors the Trust considers relevant.
(b) In the event the Trust, after any periodic re-evaluation under
Section 3.2(b) of the Trust Agreement, determines that the Payment Percentage
should be changed, such change shall be applied to all present unpaid present
claimants, all future claimants and all partially paid present claimants so that
each claimant in a substantially similar position is treated reasonably
similarly. The Trust shall not attempt to recover from any paid claimant or
claimant's representative the difference between the amount paid to the claimant
and the then prevailing Payment Percentage, and no paid claimant or claimant's
representative will have any obligation to return to the Trust any such
differential.
(c) The Trust shall consult with the TAC concerning any proposal for
adjusting the Payment Percentage, and shall supply the results of any analysis
performed by or on behalf of the Trust as well as any valuations prepared by the
Trust's investment bankers, if any, and other consultants. The proposed
adjustment shall take effect unless affirmatively objected to by the TAC. In
case of such affirmative objection, the issue shall be resolved in accordance
with Section 5.1(c) of the Trust Agreement.
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3.3 Equalization of Payment Percentages. In the event a new higher
Payment Percentage is determined the Trust shall make an additional payment to
those Trust beneficiaries who have not been paid or whose cumulative payment was
less than the new higher Payment Percentage, consistent with the objective of
paying holders of similar Claims in a substantially similar manner. However, the
Trust shall not be obligated to make such an additional payment if in the
judgment of the Trust it concludes that the administrative burden or cost does
not justify the payment at that time.
3.4 Monetization of Assets. The Trust shall monetize its assets, other
than the Causes of Action, at the earliest opportunity consistent with its
obligation to preserve and enhance the value of the Trust assets, to provide
prompt and equitable distribution of Trust Assets to present and future Keene
Asbestos Personal Injury Claimants and consistent with any provision of the Plan
or Trust Agreement imposing restrictions on the Trust Assets.
3.5 Access to Financial Information. Subject to entry into an
appropriate confidentiality agreement where applicable, the Trust shall make
available to the TAC any investment banking or other financial, accounting or
statistical information available to the Trust relating to issues to be
discussed with and/or as to which consent or advice is required of the TAC.
3.6 Amendments to Procedures Involving the Payment Percentage. The
procedures set forth herein governing the Payment Percentage may be amended,
altered, or adjusted to reflect changed circumstances, greater information,
and/or improved procedures by the Trust, with the consent of the TAC, provided
however that no amendment to these Asbestos Claims Procedures shall be
inconsistent with the provisions of Sections 3.2(a) and (b) of the Trust
Agreement.
SECTION IV.
CLAIMS, TYPES, PROCESSING AND PAYMENT
4.1 Order of Payment. Once the initial Payment Percentage is determined
and the Trust has a minimum of $30 million of Available Cash in the Personal
Injury Claim Fund as required by Section 3.2 of the Trust Agreement, the Trust
shall pay Claims in the order in which the Claims are liquidated in accordance
with Section V below. To the extent practicable, the Trust shall make such
payment within 30 days of the Trust's receipt of an executed release from the
subject claimant. If at any time the Trust has insufficient available funds to
pay any Claim, the Trust may suspend payment until such time as the Trust
monetizes additional assets. No Claim shall be preferred over any other for
purposes of payment, unless otherwise specified herein.
4.2 Prepetition Liquidated Claims.
(a) Bonded Judgments. Prepetition Liquidated Claims that have been
reduced to judgment and are secured by letters of credit, appeal bonds, or other
security or sureties ("Bonded Judgment Claims") shall first exhaust their rights
against any applicable security. If such collateral is insufficient to pay the
Bonded Judgment Claim in full, the established Payment Percentage shall be
applied to the unpaid amount of the prepetition judgment and that amount shall
be processed and paid as an allowed Claim. In the case of any Bonded Judgment
Claim where there has been a decision in Keene's favor, the Trust, in its sole
discretion, may exercise whatever appeal rights Keene possessed.
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(b) Claims Settled or Reduced to Judgment or Damage Verdict. Any other
pre-petition Personal Injury Claims against Keene that were liquidated by
settlement agreement or by an unsecured judgment or verdict as to the amount of
damages that was entered prior to December 3, 1993 ("Prepetition Liquidated
Claims") require no processing other than verification of the holder's identity,
payment, and release of the Trust. The Scheduled Value of a Prepetition
Liquidation Claim shall be the Scheduled Value for the Scheduled Disease as set
forth in Section 5.3 below or the settlement, judgment or damage verdict amount
agreed to or entered against Keene, less any payment received, whichever is
higher. Holders of Prepetition Liquidated Claims shall be paid the established
Payment Percentage based upon that higher amount.
SECTION V.
The following provisions shall apply only after (1) the Trust has a
minimum of $30 million of Available Cash in the Asbestos Personal Injury Fund as
required by Section 3.2 of the Trust Agreement and (2) the Trustees have
determined that the Trust assets are sufficiently liquid to make it cost
beneficial to begin receiving and processing Claims. Prior to that time the
Trust shall have no obligation to receive or process Claims.
5.1 Ordering and Categorizing of Unliquidated Claims.
(a) Claims Materials. As soon as reasonably practicable the Trust shall
make available claims materials ("Claims Material") to each person with a
Personal Injury Claim who (a) has a pending lawsuit against Keene; (b) filed a
proof of claim with the Court, or (c) has otherwise been identified to the Trust
as holding a Keene Personal Injury Claim that is not a Prepetition Liquidated
Claim or Bonded Judgment Claim. The Trust shall make the Claims Material
available to any person holding a Keene Personal Injury Claim who identifies
himself in writing to the Trust, as soon as practicable under the circumstances
following such identification. The Trust may make the Claims Material available
to a claimant care of an attorney representing the claimant.
(b) Claims Information. The Claims Material will include a copy of
these Asbestos Claims Procedures, instructions, and a claim form. To the extent
feasible, the claim forms used by the Trust shall be the same or substantially
similar to those used by other asbestos claims resolution facilities, subject to
the Trust's determinations pursuant to Section 5.4 below. Instead of collecting
some or all claims information from a claimant or the claimant's attorney, the
Trust may obtain such information from electronic data bases maintained by any
other asbestos claim resolution organization.
(c) Order of Claims. Claims will be ordered for processing in the order
in which they are received and for payment in the order in which they are
liquidated. Subject to the provisions of Sections 5.2 and 5.4(a) and (b) below,
a claimant may be treated by the Trust as having established disease category or
exposure if the claimant has received an offer of payment from another asbestos
claim resolution facility on the basis of evidence establishing a disease in
such disease category or establishing exposure at a site which the Trust is
satisfied would have resulted in exposure to Keene products, provided the
decision to accept claims information from such other claims resolution facility
had previously been consented to by the TAC.
(d) Time to File Claims. In order to be eligible for payment under
these Asbestos Claims Procedures, a claimant must return all claims information
requested by the Trust, or otherwise make available the information sought
pursuant to Section 5.4(b) below, within six months following his or her receipt
of the Claims Material. Failure to return the Claims Material within the six
month period will result in automatic disallowance of the claim, unless the
claimant satisfies the Trust that such failure should be excused.
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5.2 Scheduled Disease Categories. In accordance with Section 5.4(b)
below Compensable Claims will be claims of persons who establish that they were
injured by exposure to asbestos-containing products manufactured or supplied by
Keene and who suffer from medical conditions which fall within the following
five Scheduled Disease categories: (1) Mesothelioma; (2) Lung Cancer; (3) Other
Cancer; (4) Asbestos Lung Disease I ("ALD-1"); and (5) Asbestos Lung Disease II
("ALD-2").
(a) "Mesothelioma" means a diagnosis by a board-certified pathologist
of a malignant tumor caused or contributed to by exposure to asbestos
originating in the mesothelial cells of the pleura, peritoneum or like tissue,
or reasonable equivalent clinical diagnosis in the absence of adequate tissue
for pathological diagnosis.
(b) "Lung Cancer" means a diagnosis by a qualified physician of a
malignant primary tumor of any cell type, originating within the lung, caused or
contributed to by exposure to asbestos.
(c) "Other Cancer" means a diagnosis by a qualified physician that
indicates a malignant tumor originating in the larynx, pharynx, stomach,
esophagus, colon or rectum, caused or contributed to by exposure to asbestos.
(d) "ALD-1" means either: (1) a diagnosis of pulmonary asbestosis by a
board-certified internist or pulmonary specialist based on the following minimum
objective criteria:
(a) a chest x-ray abnormality of 1/1, or greater; or
(b) if a chest x-ray is not evaluated as grade 1/1 or greater for
a diagnosis of asbestosis, two of the following criteria must be
present:
(i) A chest x-ray abnormality of 1/0 or pleural encasement
(i.e., rarely seen extensive bilateral pleural changes) that
substantially contributes to one or more of the pulmonary
function abnormalities found in (ii)--(v), below; (ii) a forced
vital capacity below 80% of predicted; (iii) A diffusing capacity
below 80% of predicted; (iv) a total living capacity below 80% of
predicted; or (v) a decline of 20% over the past 5 years in any
of the following values; FVC, TLC, or DLCO; or
(2) a signed statement by a board-certified pathologist that more than
one representative section of lung tissue otherwise uninvolved with any other
process (e.g., cancer or emphysema) demonstrates a pattern of peribronchiolar or
parenchymal scarring in the presence of characteristic asbestos bodies, and also
that there is no other more likely explanation for the presence of the fibrosis.
(e) "ALD-2" means a diagnosis by a qualified physician that indicates
other abnormalities of the parenchyma or pleura attributed to prior asbestos
exposure, including pleural plaques, pleural thickening, pleural encasement and
mild parenchymal fibrosis not meeting the definition of ALD-1.
5.3 Schedule of Asbestos-Related Disease Categories and Values.
Personal Injury Claims will be categorized and valued in accordance with the
following schedule of asbestos-related diseases and values.
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Scheduled
Category Scheduled Disease Value
-------- ----------------- ---------
1 Malignant Mesothelioma $125,000.00
2 Lung Cancers $ 50,000.00
3 Other Cancer $ 30,000.00
4 Asbestos Lung Disease--1 $ 25,000.00
5 Asbestos Lung Disease--2 $ 6,500.00
5.4 Categorization of Claims and Claims Criteria and Processing.
(a) Supporting Evidence.
(i) Proof of Disease. Subject to Section 5.1(c) above and Section
5.4(c) below, in order to establish a valid Personal Injury Claim, a claimant
must submit at least one medical report from a qualified physician that contains
a diagnosis of asbestos related injury. The Trust may require the submission of
x-rays, laboratory tests, medical examinations or reviews, other medical
evidence or any other evidence to support such Personal Injury Claims and may
also require that the medical evidence submitted comply with recognized medical
standards regarding equipment, testing methods and procedures to assure that
such evidence is reliable. The Trust will categorize claims based on the medical
evidence submitted to the Trust as part of the claimant's proof of claim. A
claimant may, but not need, supplement this information with more current
medical evidence. Where the claimant has filed an incomplete claim for
categorization, the Trust may notify the claimant of the need for additional
information and the Trust need not process the Claim until the file is complete.
In addition to the data required above and by Section 5.2 above, the Trust after
consultation with the TAC, may require that additional evidence be provided.
(ii) Proof of Exposure. The Trust may require such evidence of exposure
or may apply such presumptions based on job site, occupation, dates of
employment, and other factors as the Trustees in their discretion may from time
to time determine are appropriate to balance the goal of paying only claimants
with exposure to Keene asbestos-containing product with the goal of preventing
excessive expenditure on claim processing. Any such requirements and
presumptions should be calculated to yield findings with respect to exposure
that would be permissible under the Federal Rules of Evidence.
(iii) Proof of Validity Under Applicable Law. The Trust may require
such additional evidence, if any, under the applicable substantive law and
statute of limitations as the Trustees in the exercise of their discretion may
determine is appropriate to balance the goal of paying only valid claims with
the goal of preventing excessive expenditure on claim processing.
(iv) Modification of Evidentiary Requirements. The Trustees may from
time to time review the nature of the documentation and other evidence the Trust
will require to establish a Claim under each disease category and in the
exercise of their discretion may modify such requirements to the extent they
deem advances in medical knowledge, change in claim filing patterns, or the goal
of preventing excessive expenditure on claims handling make such modification
appropriate.
(b) Other Data Banks. In lieu of actually receiving the medical and
exposure evidence discussed in Sections 5.2 and 5.4(a) above, the Trustees may,
subject to the provisions of Section 2.1(c)(xviii) of the Trust Agreement,
utilize the data bank of any other asbestos claims resolution facility provided
the decision to use the claims' information from such other claims resolution
facility has received the prior consent of the TAC. To minimize costs, this
procedure shall be utilized whenever possible to verify a Claim.
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(c) If after reviewing the Claim submitted, the Trust determines that
the Claim meets the Trust's criteria or if it is a Prepetition Liquidated Claim,
the Trust shall tender the claimant an offer of payment in the amount of the
established Payment Percentage of the Scheduled Value for the Scheduled Disease,
together with a form of release to be developed by the Trust for this purpose.
If the claimant accepts the offer and returns the release properly executed, the
Trust shall disburse payment within 30 days thereafter or as promptly as its
financial condition then permits, and in accordance with the procedures
contained in Section 3 above.
(d) If the claimant does not respond to the Trust's offer within three
months, unless that time is extended by the Trust, the Trust's offer and the
Claim will be deemed to be withdrawn. A claimant may also elect to withdraw a
Claim at any time. A Claim that is withdrawn or deemed to have been withdrawn
may be refiled at any time, and shall be ordered on the Trust Claims list based
on the date of receipt by the Trust of the refiled claim.
(e) If the Trust determines that a Claim does not meet Trust criteria
for any payment or if a claimant disagrees with the Scheduled Disease
determination made by the Trust, the claimant may dispute such determination.
Upon receipt of written advice from the claimant of such a dispute, coupled with
the claimant's written statement of the basis for the dispute and any supporting
documentation within such time period established by the Trust and communicated
to the claimant, the Trust shall reevaluate the claim in light of all then
available documentation and advise the claimant of its reevaluation. If on
reevaluation the Trust determines that the Claim qualifies for placement in a
Scheduled Disease category or in a different Scheduled Disease category than the
Trust originally determined, the Trust shall tender an offer in the amount of
the established Payment Percentage of the Scheduled Value for the Scheduled
Disease so determined, together with a form of release as described in Section
5.4(c) above. If the claimant accepts the offer and returns the release properly
executed, the Trust shall tender payment within 30 days thereafter or as
promptly thereafter as financial conditions permit, and in accordance with the
procedures contained in Section 3 above.
5.5 Audit Procedures. In all cases, the Trust may require that medical
x-rays, tests, laboratory examinations and other medical evidence comply with
recognized medical standards regarding equipment, testing methods, and
procedures to assure that such evidence is reliable. The Trust may develop
methods for auditing the reliability of medical evidence, including independent
reading of x-rays. If this audit shows an unacceptable level of reliability for
medical evidence submitted by specific doctors or medical facilities, the Trust
may refuse to accept medical evidence from such doctors or medical facilities.
In addition, the Trust may develop methods for auditing other types of
evidence necessary to support a claim.
5.6 Resolution of Categorization and Valuation Disputes.
(a) Payment of Claims. If a claim otherwise meets the criteria for
payment of Claims, the Trust will pay the established Payment Percentage of the
Scheduled Value for the disease in accordance with the provisions of these
Asbestos Claims Procedures.
(b) Litigation. Only claimants who reject the Trust's reevaluation of
the Percentage Payment of the Scheduled Value of the Claim pursuant to Section
5.4(e) above retain the right to trial against the Trust to determine the
validity and the liquidated value, if any, of their Claims. The Trust will not
be required to appear in any action brought by a claimant against the Trust nor
shall the Trust be subject to party discovery or levy and execution on any
judgment. No punitive damage claim may be asserted against the Trust and
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pursuant to the Plan of Reorganization and Confirmation Order the Trust shall
not pay any punitive damage claims awarded to a claimant. A judgment creditor is
eligible for payment from the Trust's Available Cash, as provided in Section 6.1
below, 30 days after the judgment is final and non-appealable or at such time as
the Trust's financial condition permits, and in accordance with Section 3 above.
SECTION VI.
PAYMENT FUNDS
6.1 Creation of Two Funds. The Trust shall establish two separate funds
for the payment of Claims asserted against the Trust, to be designated a Fund A
and Fund B.
(a) Fund A. Fund A will pay the established Percentage Payment of (i)
any deficiency due to a Secured Bonded Judgment holder pursuant to Section
4.2(a); (ii) any Prepetition Liquidated Personal Injury Claims pursuant to
Section 4.2(b); (iii) the Claim of any Personal Injury Claimant who accepts an
offer from the Trust based on the Scheduled Value for a Scheduled Disease; (iv)
the Claim of any Asbestos Personal Injury Claimant who obtains a verdict in the
tort system, but only up to the amount of the Scheduled Value for the particular
Scheduled Disease category established at trial.
(b) Fund B. Fund B will pay: (i) any deficiency due a Keene Asbestos
Personal Injury Claimant who received a judgment in excess of the Scheduled
Value for the Scheduled Disease; (ii) the Claim of any claimant who obtained a
judgment or has an accepted Claim for Contribution or Indemnity; (iii) any other
Keene Asbestos Personal Injury Claimant not otherwise identified, but in an
amount not to exceed the established Payment Percentage of the Scheduled Value
for the Claim in question.
(c) Distribution of Trust Cash Between the Fund. The Trust's Available
Cash for distribution to Trust beneficiaries shall be held by the Trust for
distribution to beneficiaries with determined Fund A Claims until such time if
ever that all such beneficiaries have received aggregate payments equalling 85%
of the Scheduled Value of their claims.
(d) Reallocation of Unused Fund A Amounts. If and when all claimants
due to receive money from Fund A have been paid or an appropriate reserve for
claims of future claimants has been established, the balance remaining in Fund A
will be transferred to Fund B.
SECTION VII.
TRUST LITIGATION
7.1 Dismissal of Lawsuits. In order to conserve the assets of the
Trust, except as set forth below holders of Claims are enjoined from filing
future litigation against Keene, New Keene, or the Trust, may not proceed in any
manner against the Trust, Keene or New Keene in any state or federal court, and
are required to pursue their claims against the Trust solely as provided in
these Asbestos Claims Procedures.
7.2 No Requirement to Appear. Except as provided herein, the Trust
shall not be required to enter an appearance in any court as to any claim, nor
shall it be subject to discovery or to default judgment or levy and execution on
any judgment and under no circumstances shall the Trust be required to pay
claims, whether for asbestos-related conditions or for contribution or
indemnification, except in accordance with these Asbestos Claims Procedures.
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7.3 Litigation between Trust Beneficiaries.
(a) Right to Introduce Evidence. In any litigation between Asbestos
Personal Injury Claimants and other asbestos manufacturers, all parties retain
their respective rights provided by applicable law in state or federal courts in
the appropriate jurisdiction.
(b) Third-party claims may be asserted against the Trust for the sole
purpose of listing the Trust on a verdict form in those jurisdictions where such
procedures apply.
7.4 Contribution and Indemnity Claims.
(a) Right to Pursue Contribution and Indemnity Claims Retained.
Co-defendants shall have the right to pursue contribution and indemnity only
where (1) allowed by applicable local law and (2) no set-off credit is allowed
by applicable local law. The Co-defendant shall not be eligible to assert a
contribution or indemnity claim until it has paid the entire amount due to the
claimant.
(b) Processing, Valuation and Payment of Contribution Claims. The Trust
may establish forms for filing Contributions and Indemnity Claims. Contribution
and Indemnity Claims made to the Trust shall be processed in order of their
receipt by the Trust, without reference to any list established for Claims of
Asbestos Personal Injury Claimants. Contribution and Indemnity Claims shall be
valued by the Scheduled Disease of the underlying Personal Injury Claimant and
paid the established Payment Percentage of the Scheduled Value of the claimant's
disease.
SECTION VIII.
TRUST DECISIONS FINAL
All decisions made by the Trust with respect to determining Payment
Percentages, order of payment, amount and timing of payment, and any other
matters covered by these Asbestos Claims Procedures shall be final and binding,
and not subject to review.
SECTION IX.
MISCELLANEOUS
9.1 Amendments. The Trustees may amend, modify, delete, or add to any
of these Asbestos Claims Procedures (including, without limitation, amendments
to conform these procedures to advances in scientific or medical knowledge or
other changes in circumstances) by a majority vote of the Trustees, provided
they first obtain the advice and consent of the TAC. Notwithstanding anything
contained herein to the contrary, these Asbestos Claims Procedures shall not be
modified or amended in any way that would jeopardize the validity or
enforceability of the Permanent Channeling Injunction.
9.2 Severability. Should any provision contained in the Asbestos Claims
Procedures be determined to be unenforceable, such determination shall in no way
limit or affect the enforceability and operative effect of any and all other
provisions of the Asbestos Claims Procedures.
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9.3 Attorneys' Fees. Attorneys' fees payable in connection with Trust
Claims liquidated and paid through these Asbestos Claims Procedures where
calculated as a percentage of recovery, shall be the lower of the fee provided
in the contract between claimant and counsel or 25%, exclusive of costs
chargeable to the claimant. The recovery shall be measured by the actual
payments from the Trust to the claimant, not the Scheduled Value of the Claim.
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EXHIBIT F
TO
THE PLAN
Reinhold Credit Facility Agreement
<PAGE>
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REINHOLD CREDIT FACILITY AGREEMENT
AGREEMENT (the "Agreement"), dated as of [ ], 1996, between , as
trustee (the "Trustee") of that certain trust (the "Creditors' Trust") of even
date herewith established in connection with the Debtor's Third Amended Plan of
Reorganization (the "Plan") in the Chapter 11 case captioned In re Keene
Corporation, Case No. 93 B 46090 (SMB), United States Bankruptcy Court, Southern
District of New York ("Bankruptcy Court") and Reinhold Industries, Inc., a
Delaware corporation ("Reinhold").
WHEREAS, Reinhold is successor in interest to Keene Corporation, Debtor
("Debtor") in the above-referenced case; and
WHEREAS, pursuant to the Plan, the Creditors' Trust is required to
enter into the "New Keene Credit Facility" with Reinhold on the terms and
conditions contained herein.
NOW, THEREFORE, the parties hereto agree as follows:
1. (a) During the period ("Initial Period") beginning on the
Effective Date (as defined in the Plan) and ending on the second
anniversary thereof, on the terms and conditions set forth herein, the
Creditors' Trust shall make loans (each, a "Loan" and collectively, the
"Loans") to Reinhold from time to time in an aggregate principal amount
not exceeding One Million Five Hundred Thousand ($1,500,000) Dollars at
any one time outstanding. Subject to such limitation, during the
Initial Period, Reinhold shall have the right to repay any or all of
the indebtedness due hereunder and thereafter obtain one or more
additional Loans.
(b) (i) Reinhold may exercise its right to borrow funds
hereunder by giving not less than thirty (30) days prior written notice
("Notice") of the amount and date of such borrowing, in which event the
funds shall be delivered by the Creditors' Trust to Reinhold on such
date in the form of a bank or certified check or a wire transfer to a
bank account designated by Reinhold; provided, however, that (A) the
Creditors' Trust shall not be required to honor any such Notice which
is delivered after the expiration of the Initial Period, and (B) the
minimum amount of any loan shall be One Hundred Thousand ($100,000)
Dollars.
(ii) Each such Notice shall include a certificate, duly signed
by an officer of Reinhold, that Reinhold satisfies the requirement set
forth in Section 3 as of the date of such Notice, which Notice shall be
accompanied by the internal financial statements described in Section
3(i).
(c) (i) Each Loan shall bear interest on the unpaid amount
thereof at a fluctuating rate equal to the rate of interest publicly
announced from time to time by Citibank, N.A. as its base rate ("Prime
Rate"), such interest rate to change automatically effective as of the
effective date of any change in the Prime Rate; however, such interest
rate hereunder shall not exceed the maximum rate of interest allowable
under applicable law.
(ii) Interest shall be payable on or before the fifth day of
each month with respect to the amount of interest accrued on the
outstanding loans during the preceding month.
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(iii) After the Maturity Date (or following the acceleration
of the Loans under Section 5, if earlier) the Loans shall bear interest
at the Prime Rate plus five (5%) percent per annum, (but not more than
the legally allowable interest rate).
(d) The Loans, including all accrued, unpaid interest and any
outstanding principal, shall be due on the date (the "Maturity Date")
occurring three (3) years following the Effective Date; provided,
however, that any amounts owed hereunder may be prepaid, in whole or in
part and without penalty, at any time.
(e) (i) Any payments shall be applied first against accrued
interest and thereafter against the outstanding principal of the Loans.
(ii) All payments shall be made in immediately available funds
in lawful money of the United States at such office and to such account
as designated by the Creditors' Trust.
2. As of the date hereof, Reinhold represents and warrants to
the Creditors' Trust that:
(a) The Company is a corporation formed and validly existing
under the General Corporation Law of the State of Delaware and has all
requisite power and authority under such law to own its property and to
carry on its business as now being conducted, and that it is qualified
to do business in any state and foreign jurisdiction where such
qualification is required.
(b) With such exceptions as do not in the aggregate materially
adversely affect its business, Reinhold has all permits, licenses and
approvals necessary to carry on its business as presently conducted as
required by law and each governmental agency having appropriate
authority.
(c) Reinhold has full power and authority to enter into this
Agreement and to incur and perform the obligations provided for herein,
all of which have been duly authorized by all power and necessary
action. No consent or approval of any third party, including any
governmental or administrative authority, instrumentality or agency is
required as a condition to the validity of this Agreement.
(d) This Agreement constitutes the valid and legally binding
obligation of Reinhold enforceable in accordance with its terms,
subject to bankruptcy, insolvency, reorganization and other laws of
general applicability relating to or affecting creditors' rights and to
general equity principles.
(e) To the best knowledge of Reinhold, there are no
proceedings or investigations pending or threatened before any court,
arbitrator or governmental or administrative authority, instrumentality
or agency which, in any one case or in the aggregate, could reasonably
be expected to have a materially adverse effect on Reinhold's ability
to perform its obligations under or pursuant to this Agreement.
(f) There is no statute, regulation, rule, order or judgment,
or provision of Reinhold's Amended and Restated Certificate of
Incorporation or its Amended By-laws, and no provision of any mortgage,
indenture, contract or agreement binding on Reinhold or affecting its
property, which would conflict with or prevent the execution, delivery
or carrying out of the terms of this Agreement, and no consents or
waivers of any party is required for the execution, delivery or
carrying out of the terms of this Agreement.
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3. The obligation of the Creditors' Trust to make each Loan is
subject to the following conditions precedent at the time of each such
Loan:
(a) Reinhold shall have complied and shall then be in
compliance with all the terms, covenants and conditions of this
Agreement which are binding upon it.
(b) There shall exist no Event of Default and no event which
with the giving of notice or the lapse of time, or both, would
constitute an Event of Default.
(c) The representations and warranties contained in Section 2
hereof shall be true with the same effect as though such
representations and warranties had been made at the time of the Loan.
(d) Reinhold shall have paid and discharged all taxes,
assessments and governmental charges upon it, its income and its
properties prior to the date on which penalties are attached thereto,
unless Reinhold shall be contesting such taxes, assessments or
governmental charges in good faith.
(e) Reinhold shall not have directly or indirectly sold,
leased or otherwise disposed of all or substantially all of its
properties or assets or consolidated with or merged into any other
Person, or permitted any other Person to consolidate or merge with it,
unless such person (i) assumed the obligations of Reinhold hereunder
and (ii) if immediately after giving effect to such transaction there
is no event which upon notice or lapse of time, or both, would
constitute an Event of Default.
(f) Reinhold shall be in compliance with the funding
requirements of the Employee Retirement Income Security Act of 1974
with respect to employee benefit plans for its employees.
(g) Reinhold shall be in compliance with all statutes,
regulations, orders and other regulatory requirements the noncompliance
with which would materially and adversely affect its ability to conduct
its business.
(h) Reinhold shall not be in material default under any
contract, lease, or other obligation; provided, that Reinhold shall be
deemed to be in compliance with this Section 3(h) if the aggregate
liabilities represented by such contracts, leases or obligations, as to
which Reinhold is in material default, does not exceed Fifty Thousand
($50,000) Dollars.
(i) Reinhold shall have a consolidated net book equity, as
calculated in accordance with generally accepted accounting principles
and based on the latest available internal financial statements, of not
less than Seven Hundred Fifty Thousand ($750,000) Dollars.
4. (a) As of the date hereof, the Creditors' Trust represents
and warrants to Reinhold that:
(i) The Creditors' Trust is a trust validly established and
organized under the law of the State of [New York] and has all
requisite power and authority under such law to conduct its
business as now being conducted.
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(ii) The Creditors' Trust has full power and authority to
enter into this Agreement and to incur and perform the
obligations provided for herein, all of which have been duly
authorized by all power and necessary action. No consent or
approval of any third party, including any governmental or
administrative authority, instrumentality or agency is required
as a condition to the validity of this Agreement.
(iii) This Agreement constitutes the valid and legally
binding obligation of the Creditors' Trust enforceable in
accordance with its terms, subject to bankruptcy, insolvency,
reorganization and other laws of general applicability relating
to or affecting creditors' rights and to general equity
principles.
(iv) To the best knowledge of the Creditors' Trust, there
are no proceedings or investigations pending or threatened before
any court, arbitrator or governmental or administrative
authority, instrumentality or agency which, in any one case or in
the aggregate, could reasonably be expected to have a material
adverse effect on the Creditors' Trust's ability to perform its
obligations under or pursuant to this Agreement.
(v) There is no statute, regulation, rule, order or
judgment, or provision of the agreement, dated as of even date
hereof, between the Debtor and the Trustee establishing the
Creditors' Trust or in any other contract or agreement binding on
the Creditors' Trust, or affecting its property, which would
conflict with or prevent the execution, delivery or carrying out
of the terms of this Agreement, and no consents or waivers of any
party is required for the execution, delivery or carrying out of
the terms of this Agreement.
(b) During the Initial Period, the Creditors' Trust will
reserve sufficient funds at all times so that it will be able to meet
its obligations to make Loans hereunder and the Creditors' Trust will
not merge or consolidate with any other entity, or transfer its assets
to such entity, if such action would impair the ability of the
Creditors' Trust to meet its funding obligations hereunder.
5. (a) If any one or more of the following events (hereinafter
called "Events of Default") shall have occurred and be continuing:
(i) if Reinhold shall not pay the principal or interest on
one or more of the Loans or any other amount due hereinafter,
when the same shall be due (whether at the Maturity Date, earlier
as a result of acceleration or otherwise) and such failure shall
continue for a period of five (5) days after notice thereof; or
(ii) if any representation made by Reinhold in this
Agreement shall prove to have been false or misleading in any
material respect when made; or
(iii) if, any time during the term of this Agreement
(whether or not Reinhold is requesting a Loan), Reinhold shall
not be in material compliance with the representations set forth
in Section 3 and such noncompliance shall not be remedied within
sixty (60) days after written notice, specifying such default,
shall have been delivered to Reinhold by the Creditors' Trust; or
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(iv) any of the following actions by, or with respect to,
Reinhold: Assignment for the benefit of its creditors;
application for, or appointment of, a receiver for Reinhold or
substantially all of its property; filing a voluntary petition,
or an involuntary petition which is not dismissed within 60 days,
under any of the provisions of Title 11 of the United States
Code; entry of a judgment in excess of $500,000 (execution of
which judgment has not been stayed or from which any appeal has
not been taken); dissolution; insolvency, however evidenced; or
suspension or liquidation of its usual business,
then in such event the Creditors' Trust may, at its option, exercised by written
notice to Reinhold, declare the Loans, including accrued interest, to be due and
payable immediately, whereupon the Loans shall become payable, without the
necessity of any presentment, demand, protest or further notices, all of which
are hereby waived by Reinhold.
(b) If any Event of Default shall have occurred and be
continuing, the Creditors' Trust may proceed to protect and enforce its
rights by it in equity and/or by action of law, whether for the
specific performance of any term or agreement contained herein or for
any injunction against any breach of any such term or agreement or in
aid of the exercise of any power granted herein, or proceed to enforce
the payment of the Loans or the performance of this Agreement or to
enforce any other legal or equitable rights. No remedy herein conferred
upon the Creditors' Trust is intended to be exclusive of any other
remedy, and each and every such remedy shall be cumulative and shall be
in addition to every other remedy given hereunder or now or hereafter
existing at law or in equity or by statute or otherwise.
6. The Bankruptcy Court shall retain original jurisdiction
over any disputes or controversies arising under or in connection with
this Agreement.
7. (a) All notices, requests or other communications required
or permitted to be made in accordance with this Agreement shall be in
writing and shall be delivered personally or by digital facsimile
transmission or mailed by first class mail:
(i) if to the Reinhold, to:
(ii) if to the Creditors' Trust, to:
(iii) Notices sent by facsimile transmission shall be deemed
delivered when actually received, and notices sent by first class
mail shall be deemed delivered three business days after mailing.
(b) Either party may change the address at which it is to
receive notices under this Agreement by furnishing written notice to
the other in accordance with the provisions of this Section 7.
8. (a) Reinhold agrees, in the case of the Event of Default,
to pay all reasonable expenses incurred by the Creditors' Trust in
connection with the enforcement of any provision of this Agreement and
the collection of the Loans.
(b) Each and every right granted to the Creditors' Trust
hereunder or under any other document delivered hereunder or under any
other document delivered hereunder or in connection herewith, or
allowed it by law or equity, shall be cumulative and may be exercised
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from time to time. No failure on the part of the Creditors' Trust to
exercise, and no delay in exercising, any right shall operate as a
waiver, nor shall any single or partial exercise of any right preclude
any other or future exercise thereof or the exercise of any other
right, power or privilege.
(c) This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original but which
together shall constitute but one and the same instrument.
(d) This Agreement shall be governed by, construed under and
interpreted in accordance with the laws of the State of New York,
without giving effect to principles of conflicts of law.
(e) Any provision of this Agreement which is prohibited or
unenforceable in any jurisdiction shall not invalidate the remaining
provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable any such
provision in any other jurisdiction.
(f) This Agreement may be amended, modified or terminated only
by written agreement executed by the parties hereto. This Agreement
contains the entire agreement and understanding between the parties
related to the subject matter hereof, and supersedes all prior
agreements, understandings, representations and warranties, whether
written or oral, with respect thereto.
(g) This Agreement shall bind and inure to the benefit of the
parties hereto and their respective successors and assigns. Except as
required by applicable laws, the rights and obligations of each party
hereto may not be assigned, transferred or delegated by either party.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.
REINHOLD INDUSTRIES, INC.
By:-----------------------------------------
CREDITORS' TRUST
By:-----------------------------------------
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EXHIBIT G
TO
THE PLAN
Registration Rights Agreement
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139
REGISTRATION RIGHTS AGREEMENT
REGISTRATION RIGHTS AGREEMENT, dated , 1996, among Reinhold Industries,
Inc., a Delaware corporation (the "Company"), and that certain trust established
pursuant to the Debtor's Fourth Amended Plan of Reorganization ("Plan") of Keene
Corporation, which Plan has been filed by Keene Corporation in United States
Bankruptcy Court for the Southern District of New York (Case No. 93 B 46090)
(the "Creditors' Trust").
1. Background. This Agreement is entered into pursuant to the Plan.
This Agreement shall become effective upon the issuance of the Class B New
Common Stock by Reinhold to the Creditors' Trust.
2. Registration under Securities Act.
2.1. Registration on Request. (a) Request. At any time subsequent to
the date occurring two (2) years following the Effective Date (as defined in the
Plan), the Creditors' Trust shall have the right to request in writing that the
Company use its best efforts to effect the registration under the Securities Act
of all or part of such holder's Registrable Securities; provided, however, that
the Company shall not be obligated to effect more than two registrations
pursuant to this Section 2.1 and not more than one registration in any twelve
(12) month period. The Company will use its best efforts to effect the
registration under the Securities Act of the Registrable Securities which the
Company has been so requested to register.
(b) Registration of Other Securities. Whenever the Company shall effect
a registration pursuant to this Section 2.1, no securities other than
Registrable Securities shall be included among the securities covered by such
registration unless the managing underwriter of such offering shall have advised
the Creditors' Trust that the inclusion of such other securities would not
adversely affect such offering.
(c) Registration Statement Form. Registrations under this Section 2.1
shall be on such appropriate registration form of the Commission (i) as shall be
selected by the Company and as shall be reasonably acceptable to the Creditors'
Trust; provided, however, that Form S-1 or any comparable successor form shall
be deemed acceptable and (ii) as shall permit the disposition of such
Registrable Securities in accordance with the intended method or methods of
disposition specified in their request for such registration.
(d) Expenses. The Company will pay all Registration Expenses incurred
in connection with the two registration requests pursuant to this Section 2.1,
other than the fees and expenses of counsel to the Creditors' Trust or the fees
and expenses of any other person retained by the Creditors' Trust and the
underwriting discounts and commissions and transfer taxes allocable to the
Registrable Securities being sold.
(e) Effective Registration Statement. A registration requested pursuant
to this Section 2.l shall not be deemed to have been effected (i) unless a
registration statement with respect thereto has become effective and, unless all
the securities registered thereby are theretofore sold, has remained effective
for at least 90 consecutive days, (ii) if after it has become effective, such
registration is interfered with by any stop order, injunction or other order or
requirement of the Commission or other governmental agency or court for any
reason, and the Registrable Shares covered thereby have not been sold, or (iii)
if the conditions to closing on the part of the underwriter with respect to the
Company specified in the selling agreement or underwriting agreement entered
into in connection with such registration are not satisfied or waived by the
underwriters. The Company shall not register the Registrable Securities on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act, or
any like registration form.
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(f) Underwriters. If any registration effected pursuant to this Section
2.1 shall be a firm commitment or best efforts underwritten public offering, the
managing underwriter or underwriters thereof shall be selected by the Creditors'
Trust with the consent of the Company, which consent will not be unreasonably
withheld.
(g) Apportionment in Registrations Requested. If, in connection with a
registration requested pursuant to this Section 2.1, the managing underwriter
shall advise the Company in writing that, in its opinion, marketing factors
require a delay in the offering or a limitation of the number of shares to be
underwritten below the number of shares requested to be included in such
registration or the number of securities requested to be included in such
registration exceeds the number which can be sold in such offering within a
price range acceptable to the Creditors' Trust requested to be included in such
registration, the Company will include in such registration the number of shares
that the Company is so advised can be sold in such offering. In connection with
any registration as to which the provisions of this clause (g) apply, no
securities other than Registrable Securities shall be covered by such
registration and if the aforesaid results in the exclusion of in excess of 50%
of the Registrable Securities originally sought to be registered and the holders
of Registrable Securities elect not to proceed, the request shall not be counted
for purposes of determining the number of registrations pursuant to Section 2.1
hereof. If a registration pursuant to this clause (g) includes securities of
other persons in accordance with Section 2.1(b) hereof and the managing
underwriter concludes that preceding criteria is appropriate, the securities
proposed to be included by such other persons shall be eliminated from the
offering prior to effecting any reduction in the number of Registrable
Securities to be included by the Creditors' Trust.
(h) (i) Within one hundred twenty (120) days immediately following the
effective date of any registration statement filed pursuant to this Section 2.1
or (ii) if the Company shall furnish a certificate signed by the President of
the Company stating that in the good faith judgment of the Board of Directors of
the Company, it would be seriously detrimental to the Company or its
stockholders for such registration statement to be filed on or before the date
filing would be required and it is therefore essential to defer the filing of
such registration statement, then the Company shall have the right to defer the
filing of the registration statement for a period of not more than 120 days;
provided, however, that the Company may not utilize such right more than once in
any twelve month period.
2.2. Incidental Registration. (a) Right to Include Registrable
Securities. If the Company at any time proposes to register any of its Class A
New Common Stock under the Securities Act (other than by a registration on Form
S-8 or Form S-4 or any successor or similar form, in connection with a merger or
acquisition of a business or assets or similar transaction), whether or not for
sale for its own account, it will each such time give prompt written notice to
the Creditors' Trust of its intention to do so and of the Creditors' Trust's
rights under this Section 2.2. Upon the written request of the Creditors' Trust
made within 30 days after the receipt of any such notice (which request shall
specify the Registrable Securities intended to be disposed of by such holder and
the intended method of disposition thereof), the Company will use reasonable
diligence to effect the registration under the Securities Act of all Registrable
Securities which the Company has been so requested to register, provided that
the number of shares of Registrable Securities of the Creditor's Trust shall not
exceed the number of shares of Class A New Common Stock which the Company then
intends to register; provided, further, that if, at any time after giving
written notice of its intention to register any securities and prior to the
effective date of the registration statement filed in connection with such
registration, the Company shall determine for any reason not to register or to
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delay registration of such securities, the Company may, at its election, give
written notice of such determination to the Creditors' Trust and, thereupon, (i)
in the case of a determination not to register, shall be relieved of its
obligation to register any Registrable Securities in connection with such
registration (but not from its obligation to pay the Registration Expenses in
connection therewith), without prejudice, however, to the rights of the
Creditors' Trust to request that such registration be effected as a registration
under Section 2.1, and (ii) in the case of a determination to delay registering,
shall be permitted to delay registering any Registrable Securities, for the same
period as the delay in registering such other securities. No registration
effected under this Section 2.2 shall relieve the Company of its obligation to
effect any registration upon request under Section 2.1. The Company will pay all
Registration Expenses in connection with each registration of Registrable
Securities requested pursuant to this Section 2.2, other than the fees and
expenses of counsel to the Creditors' Trust or the fees and expenses of any
other person retained by the Creditors' Trust and the underwriting discounts and
commissions and transfer taxes allocable to the Registrable Securities being
sold.
(b) Apportionment in Incidental Registrations. If (i) registration
pursuant to this Section 2.2 involves an underwritten offering of the securities
being registered, whether or not for sale for the account of the Company, to be
distributed (on a firm commitment or best efforts basis) by or through one or
more underwriters of recognized standing under underwriting terms appropriate
for such a transaction, and (ii) the managing underwriter of such underwritten
offering shall inform the Company (who shall immediately notify the Creditors'
Trust of its belief that marketing factors require a delay in the offering or a
limitation of the number of shares to be underwritten below the number of shares
requested to be included in such registration or the number of securities
requested to be included in such registration exceeds the number which can be
sold in (or during the time of) such offering, or within a price range
acceptable to it and the Company, then the Company may include all securities
proposed by the Company to be sold for its own account and may decrease the
number of Registrable Securities and other securities of the Company so proposed
to be sold and so requested to be included in such registration by the
Creditors' Trust to the extent necessary to reduce the number be included in the
registration to the level recommended by the managing underwriter.
2.3. Registration Procedures. If and whenever the Company is required
to use its best efforts to effect the registration of any Registrable Securities
under the Securities Act as provided in Sections 2.1 and 2.2, the Company will
as expeditiously as possible:
(i) prepare and (as soon thereafter as possible or in any event
no later than 90 days after the end of the period within which
requests for registration may be given to the Company or such longer
period as the Company shall in good faith require to produce the
financial statements required in connection with such registration)
file with the Commission the requisite registration statement to
effect such registration and thereafter use its best efforts to cause
such registration statement to become effective, provided that the
Company may discontinue any registration of its securities which are
not Registrable Securities (and, under the circumstances specified in
Section 2.2(a), its securities which are Registrable Securities) at
any time prior to the effective date of the registration statement
relating thereto;
(ii) prepare and file with the Commission such amendments and
supplements to such registration statement and the prospectus used in
connection therewith as may be necessary to keep such registration
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statement effective for at least 90 consecutive days and to comply
with the provisions of the Securities Act with respect to the
disposition of all securities covered by such registration statement
until such time as all of such securities have been disposed of in
accordance with the intended methods of disposition by the seller or
sellers thereof set forth in such registration statement;
(iii) furnish to the Creditors' Trust to the extent that it is
selling shares covered by such registration statement such number of
conformed copies of such registration statement and of each such
amendment and supplement thereto (in each case including all exhibits,
but only one copy thereof), such number of copies of the prospectus
contained in such registration statement (including each preliminary
prospectus and any summary prospectus) and any other prospectus filed
under Rule 424 under the Securities Act, in conformity with the
requirements of the Securities Act, and such other documents, as such
seller may reasonably request; (iv) use its best efforts to register
or qualify all Registrable Securities and other securities covered by
such registration statement under such other securities or blue sky
laws or such jurisdictions as the managing underwriter shall request,
to keep such registration or qualification in effect for so long as
such registration statement remains in effect, and take any other
action which may be reasonably necessary or advisable to enable such
seller to consummate the disposition in such jurisdictions of the
securities owned by such seller, except that the Company shall not for
any such purpose be required to qualify generally to do business as a
foreign corporation in any jurisdiction wherein it would not but for
the requirements of this subdivision (iv) be obligated to be so
qualified or to consent to general service of process in any such
jurisdiction;
(v) use its best efforts to cause all Registrable Securities
covered by such registration statement to be registered with or
approved by such other governmental agencies or authorities as may be
necessary to enable the seller or sellers thereof to consummate the
disposition of such Registrable Securities;
(vi) furnish to the Creditors' Trust to the extent that it is
selling shares a signed counterpart, addressed to such seller, except
as provided in (y) below, (and the underwriters, if any)
(x) a signed copy, addressed to each seller of Registrable
Securities, of the opinion of counsel for the Company delivered
to the underwriters or other purchasers under the underwriting or
like agreement, and
(y) a signed copy of any "comfort" letter, dated the
effective date of such registration statement (and, if such
registration includes an underwritten public offering, dated the
date of the closing under the underwriting agreement), signed by
the independent public accountants who have certified the
Company's financial statements included in such registration
statement, addressed to each seller, to the extent the same can
be reasonably obtained, and addressed to the underwriters, if
any, covering substantially the same matters with respect to such
registration statement (and the prospectus included therein) and,
in the case of the accountants' letter, with respect to events
subsequent to the date of such financial statements, as are
customarily covered in opinions of issuer's counsel and in
accountants' letters delivered to the underwriters in
underwritten public offerings of securities and, in the case of
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the accountants' letter, such other financial matters, and, in
the case of the legal opinion, such other legal matters, as such
seller or such holder (or the underwriters, if any) may
reasonably request; provided, however, that in an underwritten
public offering, the sellers of Registrable Shares shall accept a
signed copy of the comfort letter delivered to and accepted by
the underwriters;
(vii) notify each seller of Registrable Securities covered by
such registration statement, at any time when a prospectus relating
thereto is required to be delivered under the Securities Act, upon
discovery that, or upon the happening of any event as a result of
which, the prospectus included in such registration statement, as then
in effect, includes an untrue statement of a material fact or omits to
state any material fact required to be stated therein or necessary to
make the statements therein not misleading in the light of the
circumstances under which they were made, and at the request of any
such seller or holder promptly prepare to furnish to such seller or
holder a reasonable number of copies of a supplement to or an
amendment of such prospectus as may be necessary so that, as
thereafter delivered to the purchasers of such securities, such
prospectus shall not include an untrue statement of a material fact or
omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading in the light
of the circumstances under which they were made;
(viii) otherwise use its best efforts to comply with all
applicable rules and regulations of the Commission, and make available
to its security holders, as soon as reasonably practicable, an
earnings statement covering the period of at least twelve months, but
not more than eighteen months, beginning with the first full calendar
month after the effective date of such registration statement, which
earnings statement shall satisfy the provisions of Section 11(a) of
the Securities Act, and will furnish to each such seller at least two
business days prior to the filing thereof a copy of any amendment or
supplement to such registration statement or prospectus and shall not
file any thereof to which any such seller shall have reasonably
objected on the grounds that such amendment or supplement does not
comply in all material respects with the requirements of the
Securities Act or of the rules or regulations thereunder;
(ix) provide and cause to be maintained a transfer agent and
registrar for all Registrable Securities covered by such registration
statement from and after a date not later than the effective date of
such registration statement; and
(x) use its best efforts to list all Registrable Securities
covered by such registration statement on any securities exchange on
which any of the Registrable Securities is then listed.
The Company may require the Creditors' Trust to furnish the Company in writing
such information regarding the Creditors' Trust and the distribution of such
securities as the Company may from time to time reasonably request.
The Creditors' Trust agrees by acquisition of such Registrable
Securities that upon receipt of any notice from the Company of the happening of
any event of the kind described in subdivision (vii) of this Section 2.3, it
will forthwith discontinue disposition of Registrable Securities pursuant to the
registration statement relating to such Registrable Securities until such
holder's receipt of the copies of the supplemented or amended prospectus
contemplated by subdivision (vii) of this Section 2.3 and, if so directed by the
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144
Company, will deliver to the Company (at the Company's expense) all copies,
other than permanent file copies, then in its possession of the prospectus
relating to such Registrable Securities current at the time of receipt of such
notice.
2.4. Underwritten Offerings. (a) Requested Underwritten Offerings. If
requested by the underwriters for any offering pursuant to a registration
requested under Section 2.1, the Company will enter into an underwriting
agreement with such underwriters for such offering, such agreement to be
satisfactory in substance and form to the Company and to the Creditors' Trust
and the underwriters and to contain such representations and warranties by the
Company and the Creditors' Trust and such other terms as are generally
prevailing in agreements of this type, including, without limitation,
indemnities to the effect and to the extent provided in Section 2.6. The
Creditors' Trust will cooperate with the Company in the negotiation of the
underwriting agreement and will give consideration to the reasonable requests of
the Company regarding the form thereof, provided that nothing herein contained
shall diminish the foregoing obligations of the Company.
(b) Incidental Underwritten Offerings. If the Company at any time
proposes to register any of its securities under the Securities Act as
contemplated by Section 2.2 and such securities are to be distributed by or
through one or more underwriters, the Company will, if requested by the
Creditors' Trust as provided in Section 2.2 and subject to the provisions of
Section 2.2(b), arrange for such underwriters to include all the Registrable
Securities to be offered and sold by the Creditors' Trust among the securities
to be distributed by such underwriters.
2.5. Preparation; Reasonable Investigation. In connection with the
preparation and filing of each registration statement under the Securities Act
pursuant to this Agreement, the Company will give the Creditors' Trust and its
counsel the opportunity to participate in the preparation of such registration
statement, each prospectus included therein or filed with the Commission, and
each amendment thereof or supplement thereto, and will give each of them such
access to its books and records and such opportunities to discuss the business
of the Company with its officers and the independent public accountants who have
certified its financial statements as shall be necessary, in the opinion of such
holders' and such underwriters' respective counsel, to conduct a reasonable
investigation within the meaning of the Securities Act.
2.6. Indemnification. (a) Indemnification by the Company. In the event
of any registration of any securities of the Company under the Securities Act,
the Company will, and hereby does, indemnify and hold harmless the Creditors'
Trust, its trustees, employees and agents, each other Person who participates as
an underwriter in the offering or sale of such securities and such other Person,
if any, who controls such seller or any such underwriter within the meaning of
the Securities Act, against any losses, claims, damages or liabilities, joint or
several, to which such seller or any such trustee, employee, agent, underwriter
or controlling person may become subject under the Securities Act or otherwise,
insofar as such losses, claims, damages or liabilities (or actions or
proceedings, whether commenced or threatened, in respect thereof) arise out of
or are based upon any untrue statement or alleged untrue statement of any
material fact contained in any registration statement under which such
securities were registered under the Securities Act, any preliminary prospectus,
final prospectus or summary prospectus contained therein, or any amendment or
supplement thereto, or any omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, and the Company will reimburse such seller and each such
trustee, employee, agent, underwriter and controlling person for any legal or
any other expenses reasonably incurred by them in connection with investigating
or defending any such loss, claim, liability, action or proceeding; provided
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145
that the Company shall not be liable in any such case to the extent that any
such loss, claim, damage, liability (or action or proceeding in respect thereof)
or expense arises out of or is based upon an untrue statement or alleged untrue
statement or omission or alleged omission made in such registration statement,
any such preliminary prospectus, final prospectus, summary prospectus, amendment
or supplement in reliance upon and in conformity with written information
furnished to the Company in writing by or on behalf of a seller for use in the
preparation thereof and, provided further that the Company shall not be liable
to any Person who participates as an underwriter, in the offering or sale of
Registrable Securities or any other Person, if any, who controls such
underwriters within the meaning of the Securities Act, in any such case to the
extent that any such loss, claim, damage, liability (or action or proceeding in
respect thereof) or expense arises out of such Person's failure to send or give
a copy of the final prospectus, as the same may be then supplemented or amended,
to the Person asserting an untrue or alleged untrue statement or omission or
alleged omission or prior to the written confirmation of the sale of Registrable
Securities to such Person if such statement or omission was corrected in such
final prospectus. Such indemnity shall remain in full force and effect
regardless of any investigation made by on or behalf of such seller or any such
trustee, employee, agent, underwriter or controlling person and shall survive
the transfer of such securities by such seller.
(b) Indemnification by Creditors' Trust. The Company may require, as a
condition to including any Registrable Securities in any registration statement
filed pursuant to Section 2.3, that the Company shall have received an
undertaking satisfactory to it from the prospective seller of such securities,
to indemnify and hold harmless (in the same manner and to the same extent as set
forth in subdivision (a) of this Section 2.6) the Company, each director of the
Company, each officer of the Company and each other Person, if any, who controls
the Company within the meaning of the Securities Act, with respect to any
statement or alleged statement in or omission or alleged omission from such
registration statement, any preliminary prospectus, final prospectus or summary
prospectus contained therein, or any amendment or supplement thereto, if such
statement or alleged statement or omission or alleged omission was made in
reliance upon and in conformity with written information furnished to the
Company in writing by or on behalf of the Creditors' Trust, specifically for use
in the preparation of such registration preliminary prospectus, final
prospectus, summary prospectus, amendment or supplement. Such indemnity shall
remain in full force and effect, regardless of any investigation made by or on
behalf of the Company or any such director, officer or controlling Person and
shall survive the transfer of such securities by such seller.
(c) Notices of Claims, etc. Promptly after receipt by an indemnified
party of notice of the commencement of any action or proceeding involving a
claim referred to in the preceding subdivisions of this Section 2.6, such
indemnified party will, if a claim in respect thereof is to be made against an
indemnifying party, give written notice to the latter of the commencement of
such action, provided that the failure of any indemnified party to give notice
as provided herein shall not relieve the indemnifying party of its obligations
under the preceding subdivisions of this Section 2.6, except to the extent that
the indemnifying party is actually prejudiced by such failure to give notice. In
case any such action is brought against an indemnified party, unless in such
indemnified party's reasonable judgment a conflict of interest between such
indemnified party and indemnifying parties may exist in respect of such claim,
the indemnifying party shall be entitled to participate in and to assume the
defense thereof, jointly with any other indemnifying party similarly notified to
the extent that it may wish, with counsel reasonably satisfactory to such
indemnified party, and after notice from the indemnifying party to such
indemnified party of its election so to assume the defense thereof, the
indemnifying party shall not be liable to such indemnified party for any legal
or other expenses subsequently incurred by the latter in connection with the
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146
defense thereof other than reasonable costs of investigation. No indemnifying
party shall, without the consent of the indemnified party, consent to entry of
any judgment or enter into any settlement which does not include as an
unconditional term thereof the giving by the claimant or plaintiff to such
indemnified party of a release from all liability in respect to such claim or
litigation.
(d) Other Indemnification. Indemnification similar to that specified in
the preceding subdivisions of this Section 2.6 (with appropriate modifications)
shall be given by the Company and the Creditors' Trust with respect to any
required registration or other qualification of securities under any Federal or
state law or regulation of any governmental authority other than the Securities
Act.
(e) Indemnification Payments. The indemnification required by this
Section 2.6 shall be made by periodic payments of the amount thereof during the
course of the investigation or defense, as and when bills are received or
expense, loss, damage or liability is incurred.
(f) Lock-up. The underwriter for any offering of the Company's
securities to the general public shall have the option to restrict the sale of
any of the Company's Common Stock, or Securities exchangeable therefor, by the
Company (except for securities subject to a registration on Form S-8) other than
securities registered in such offering, for a period of up to 120 days from the
effective date of any such offering.
3. Definitions. As used herein, unless the context otherwise requires,
the following terms have the following respective meanings:
Commission: The Securities and Exchange Commission or any other Federal
agency at the time administering the Securities Act.
Class A New Common Stock: Class A New Common Stock, $.01 par value per
share, of the Company.
Class B New Common Stock: Class B New Common Stock, $.01 par value per
share, of the Company.
Company: Reinhold Industries, Inc., a Delaware corporation.
Exchange Act: The Securities Exchange Act of 1934, as amended.
Person: A corporation, an association, a partnership, a business, an
individual, a governmental or political subdivision thereof or a governmental
agency.
Registrable Securities: Any shares of Class B New Common Stock owned by
the Creditors' Trust, which shall be converted into Class A New Common Stock
upon registration or any shares of Class A New Common Stock owned by a
Transferee, provided that the Creditors' Trust expressly assigned its rights
under this Registration Agreement to such Transferee, but in no event shall the
Registrable Securities subject to this Agreement in the hands of such Transferee
exceed the number of shares of Class B New Common Stock assigned or transferred
by the Creditors' Trust to such Transferee (which shares were converted into
Class A New Common Stock upon such assignment or transfer). Registrable
Securities shall cease to be Registrable Securities when (a) a registration
statement with respect to the sale of such securities shall have become
effective under the Securities Act and such securities shall have been disposed
of in accordance with such registration statement, (b) they shall have been
distributed to the public pursuant to Rule 144 (or any successor provision)
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147
under the Securities Act, (c) they shall have been otherwise transferred, new
certificates for them not bearing a legend restricting further transfer shall
have been delivered by the Company or (d) they shall have ceased to be
outstanding.
Registration Expenses: All expenses incident to the Company's
performance of or compliance with Section 2, including, without limitation, all
registration, filing and National Association of Securities Dealers, Inc. fees,
all fees and expenses of complying with securities or blue sky laws, all word
processing, duplicating and printing expenses, messenger and delivery expenses,
the fees and disbursements of counsel for the Company and of independent public
accountants, including the expenses of any special audits or "cold comfort"
letters required by or incident to such performance and compliance, the fees and
disbursements of one counsel retained by the Creditors' Trust provided, however,
that Registration Expenses shall not include underwriting, discounts and
commissions and transfer taxes, if any.
Securities Act: The Securities Act of 1933, as amended.
Transferee: Any Person to which the Creditors' Trust has conveyed,
assigned or transferred at least 200,000 shares of Common Stock.
4. Rule 144. If the Company shall have filed a registration statement
pursuant to the requirements of Section 12 of the Exchange Act or a registration
statement pursuant to the requirements of the Securities Act, the Company will
file the reports required to be filed by it under the Securities Act and the
Exchange Act (or, if the Company is not required to file such reports, will,
upon the request of any holder of Registrable Securities, use its best efforts
to make publicly available other information) and will use its best efforts to
take such further action as any holder of Registrable Securities may reasonably
request, all to the extent required from time to time to enable such holder to
sell Registrable Securities without registration under the Securities Act within
the limitation of the exemptions provided by (a) Rule 144 under the Securities
Act, as such Rule may be amended from time to time or (b) any similar rule or
regulation hereafter adopted by the Commission. Upon the request of any holder
of Registrable Securities, the Company will deliver to such holder a written
statement as to whether it has complied with such requirements.
5. Term. This Agreement and the rights of the parties hereunder shall
commence on the Effective Date and shall terminate on the tenth anniversary
following such Effective Date.
6. Amendments and Waivers. This Agreement may be amended and the
Company may take any action herein prohibited or to perform any act herein
required to be performed by it, only if the Company shall have obtained the
written consent to such amendment, action or omission to act, of the Creditors'
Trust.
7. Notices. All communications provided for hereunder shall be sent by
first-class mail and (a) if addressed to the Creditors' Trust, at , or (b) if
addressed to the Company, at to the attention of its President.
8. Assignment. This Agreement shall be binding upon and inure to the
benefit of and be enforceable by the parties hereto and their respective
successors and assigns.
9. Descriptive Headings. The descriptive headings of the several
sections and paragraphs of this Agreement are inserted for reference only and
shall not limit or otherwise affect the meaning hereof.
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10. GOVERNING LAW. THIS AGREEMENT SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH, AND THE RIGHTS OF THE PARTIES SHALL BE GOVERNED BY, THE LAWS OF
THE STATE OF NEW YORK.
11. Counterpart. This Agreement may be executed simultaneously in any
number of counterparts, each of which shall be deemed an original, but all such
counterparts shall together constitute one and the same instrument.
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed and delivered by their respective officers thereunto duly authorized as
of the date first above written.
REINHOLD INDUSTRIES, INC.
By:-----------------------------------------
Authorized Officer
CREDITORS' TRUST
By:-----------------------------------------
Trustee
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149
EXHIBIT H
TO
THE PLAN
Share Authorization Agreement
<PAGE>
150
SHARE AUTHORIZATION AGREEMENT
This Agreement, dated , 1996, by and between Reinhold Industries, Inc.
("Reinhold"), a Delaware corporation and , as trustees ("Trustee") of that
certain trust ("Creditors' Trust") established pursuant to Debtor's Fourth
Amended Plan of Reorganization ("Plan") of Keene Corporation, Debtor ("Debtor")
in Case No. 93 B 46090 (SMB), United States Bankruptcy Court, Southern District
of New York ("Bankruptcy Court").
W I T N E S S E T H :
WHEREAS, the Bankruptcy Court confirmed the Plan by order dated , 1996
and the Plan was consummated on the Effective Date (as defined in the Plan); and
WHEREAS, Reinhold is successor-in-interest to Debtor and, pursuant to
the Plan, adopted an Amended and Restated Certificate of Incorporation of
Reinhold Industries, Inc. ("Certificate"); and
WHEREAS, the Certificate authorizes and, pursuant to the Plan,
on the Effective Date Reinhold issued to the Creditors' Trust 1,020,000 shares
of the Class B New Common Stock, par value $.01 ("Class B Common") of Reinhold;
and
WHEREAS, the Certificate authorizes 1,480,000 shares of Class A New
Common Stock, par value $.01 ("Class A Common") of Reinhold, of which 980,000
shares of Class A Common are issued and outstanding on the Effective Date; and
WHEREAS, Section 8.2(iv) of the Plan provides that no additional shares
of Class A Common will be authorized or issued without the prior written consent
of the Creditors' Trust, provided that the Class B Common then outstanding
represents not less than ten (10%) percent of the aggregate number of the sum of
the shares of Class A Common and Class B Common (collectively, "New Common
Stock").
NOW, THEREFORE, the parties hereto, intending to be legally bound,
agree as follows:
1. (a) Without the prior written consent of the Trustees, which may be
withheld in their sole discretion, Reinhold shall not (i) amend its
Certificate to authorize any shares of Class A Common in excess of the
1,480,000 shares now authorized therein or (ii) issue any shares of Class A
Common in excess of the 980,000 shares now issued and outstanding;
provided, however, that Reinhold shall not be required to obtain such
written consent on or after the earliest date on which the number of shares
of Class B Common then outstanding is less than ten (10%) percent of the
total number of shares of New Common Stock.
2. (a) Reinhold acknowledges that this Agreement was negotiated as an
integral part of the Plan and that any breach of the restrictions set forth
herein will cause irreparable damage to the Creditors' Trust in its
capacity as a major shareholder of Reinhold.
(b) In the event of an actual or threatened breach by Reinhold of
the provisions of this Agreement, the Creditors' Trust shall be entitled to
an injunction restraining Reinhold from such violation, provided that
nothing set forth in this Section 2 shall be construed as prohibiting the
Creditors' Trust from pursuing any other legal or equitable remedies
available with respect to such breach, including the recovery of damages.
In addition, Reinhold shall be liable for any and all costs and damages,
including reasonable legal fees incurred by the Creditors' Trust, as a
result of any breach of the provisions of this Agreement.
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3. The Bankruptcy Court shall retain original jurisdiction over any
disputes or controversies arising under or in connection with this
Agreement.
4. The term of this Agreement shall commence on the Effective Date and
end on the earlier of (i) the date occurring ten years thereafter or (ii)
the earliest date described in Section 1(a).
5. (a) All notices, requests or other communications required or
permitted to be made in accordance with this Agreement shall be in writing
and shall be delivered personally or by digital facsimile transmission or
mailed by first class mail:
(i) if to Reinhold, to:
(ii) if to the Creditors' Trust, to:
(iii) Notices sent by facsimile transmission shall be deemed
delivered when actually received, and notices sent by first class mail
shall be deemed delivered three business days after mailing.
(b) Either party may change the address at which it is to receive
notices under this Agreement by furnishing written notice to the other in
accordance with the provisions of this Section 5(a).
6. (a) This Agreement may be executed in one or more counterparts,
each of which shall be deemed an original but which together shall
constitute but one and the same instrument.
(b) This Agreement shall be governed by, construed under and
interpreted in accordance with the laws of the State of New York, without
giving effect to principles of conflicts of law.
(c) Any provision of this Agreement which is prohibited or
unenforceable in any jurisdiction shall not invalidate the remaining
provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable any such
provision in any other jurisdiction.
(d) This Agreement may be amended, modified or terminated only by
written agreement executed by the parties hereto. This Agreement contains
the entire agreement and understanding between the parties related to the
subject matter hereof, and supersedes all prior agreements, understandings,
representations and warranties, whether written or oral, with respect
thereto.
(e) This Agreement shall bind and inure to the benefit of the
parties hereto and their respective successors and assigns. Except as
required by applicable laws, the rights and obligations of each party
hereto may not be assigned, transferred or delegated by either party.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.
REINHOLD INDUSTRIES, INC.
By:-----------------------------------------
KEENE CREDITORS' TRUST
By:-----------------------------------------
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152
EXHIBIT I
TO
THE PLAN
Reinhold Industries, Inc.
Stock Incentive Plan
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153
REINHOLD INDUSTRIES, INC.
STOCK INCENTIVE PLAN
SECTION 1. ESTABLISHMENT, PURPOSE, AND EFFECTIVE DATE OF PLAN
1.1. Establishment. Reinhold Industries, Inc., a Delaware corporation
(the "Company"), hereby establishes the "STOCK INCENTIVE PLAN" (the "Plan") for
key employees. The Plan permits the grant of Stock Options, Stock Appreciation
Rights and Restricted Stock.
1.2. Purpose. The purpose of the Plan is to advance the interests of
the Company and its Subsidiaries and promote continuity of management by
encouraging and providing key employees with the opportunity to acquire an
equity interest in the Company and to participate in the increase in shareholder
value as reflected in the growth in the price of the shares of the Company's
Stock and by enabling the Company to attract and retain the services of key
employees.
1.3. Effective Date. The Plan shall become effective on the Effective
Date, as defined in the Debtor's Fourth Amended Plan of Reorganization of Keene
Corporation, as debtor and debtor-in-possession, dated , 1996 and filed with the
United States Bankruptcy Court for the Southern District of New York on , 1996,
as such Plan may be amended or modified from time to time (the "Bankruptcy
Plan"), subject to the approval by the affirmative votes of the holders of a
majority of the securities of the Company entitled to vote.
SECTION 2. DEFINITIONS; CONSTRUCTION
2.1. Definitions. Whenever used herein, the following terms shall have
their respective meanings set forth below:
(a) "Act" means the Securities Exchange Act of 1934, as amended.
(b) "Board" means the Board of Directors of the Company.
(c) "Change in Capitalization" means any increase or reduction in
the number of shares of Stock, or any change (including, but not
limited to, a change in value) in the shares of Stock or exchange of
shares of Stock for a different number or kind of shares or other
securities of the Company or any other corporation or other entity, by
reason of a reclassification, recapitalization, merger, consolidation,
reorganization, spin-off, split-up, issuance (other than pursuant to
the Plan of Reorganization) of warrants or rights or debentures, stock
dividend, stock split or reverse stock split, extraordinary dividend,
property dividend, combination or exchange of shares or otherwise.
(d) A "Change in Control" means an event or series of events
after the Consummation Date by which (i) any "person" or "group" (as
such terms are used in Section 13 (d) and 14(d) of the Act) becomes
the "beneficial owner" (as defined in Rule 13d-3 under the Act),
directly or indirectly, of more than fifty (50%) percent of the
aggregate voting power of all the capital stock of the Company
normally entitled to vote in the election of directors or (ii) during
any period of two consecutive calendar years individuals who at the
beginning of such period constituted the Board (together with any new
directors whose election by the Board or whose nomination for election
by the Company's stockholders was approved by a vote of at least a
majority of the directors then still in office who either were
directors at the beginning of such period or whose election or
nomination was previously so approved) cease for any reason to
constitute a majority of the directors then in office.
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(e) "Code" means the Internal Revenue Code of 1986, as amended.
(f) "Committee" means a committee of the Board designated to
administer the Plan which shall consist solely of two or more members
of the Board who are "disinterested" within the meaning of Rule 16b-3
under the Act and "outside directors" within the meaning of Section
162(m) of the Code.
(g) "Company" means Reinhold Industries, Inc., a Delaware
corporation, as successor-in-interest to Keene Corporation.
(h) "Disability" means that, for a period of six (6) consecutive
months, an individual is unable to engage in any substantial activity
required by his employment by reason of any medically determinable,
physical or mental impairment, which, in the opinion of qualified
physicians, is likely to continue for an indefinite period or result
in the death of the individual within the near future.
(i) "Eligible Employee" means any key employee designated by the
Committee as eligible to participate in the Plan pursuant to Section
3.1 hereof.
(j) "Employee Option" means an Option granted to an Eligible
Employee pursuant to Section 6.
(k) "Fair Market Value" means the mean of the high and low prices
at which the Stock is reported to have traded on the relevant date as
reported on the NASDAQ Electronic Interdealer Quotation System
("NASDAQ System"); and if there is no trade on the relevant date, the
Fair Market Value shall mean the mean of the low asked and high bid
prices on that date as reported on the NASDAQ System. If the principal
market for the Stock shall become a national securities exchange then
the fair market value shall mean the mean of the high and low prices
at which the Stock is reported to have traded on the relevant date;
and if there is no trade on the relevant date, the Fair Market Value
shall mean the mean of the low asked and high bid prices on that date.
If no Fair Market Value has been established in accordance with the
foregoing, Fair Market Value shall be the value established by the
Board in good faith and, in the case of an Incentive Stock Option, in
accordance with Section 422 of the Code.
(l) "Option" means the right to purchase Stock at a stated price
for a specified period of time. For purposes of the Plan, an Option
may be either (i) an "incentive stock option" within the meaning of
Section 422 of the Code or (ii) a "nonstatutory stock option."
(m) "Option Agreement" means the agreement evidencing the grant
of an Option as described in Subsection 6.2.
(n) "Option Price" means the price at which Stock may be
purchased pursuant to an Option.
(o) "Optionee" means a person to whom an Option has been granted
under the Plan.
(p) "Participant" means an Eligible Employee who has been granted
and, at the time of reference, holds an Option or share of Restricted
Stock.
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155
(q) "Period of Restriction" means the period during which shares
of Restricted Stock are subject to restrictions pursuant to Section 9
of the Plan.
(r) "Restricted Stock" means Stock granted to an Eligible
Employee pursuant to Section 9 of the Plan.
(s) "Retirement" means the termination of employment with the
Company or any Subsidiary by reason of the attainment of the age which
the Company, by policy or otherwise, has established as the age at
which salaried employees may or shall be required to terminate their
employment and receive retirement benefits.
(t) "Stock" means the Class A New Common Stock of the Company,
par value $ per share.
(u) "Stock Appreciation Right" means the right to receive the
increase in the value of Stock subject to an Option in lieu of
purchasing such Stock.
(v) "Subsidiary" means any present or future subsidiary of the
Company, as defined in Section 424(f) of the Code.
2.2. Number. Except when otherwise indicated by the context, the
singular shall include the plural, and the plural shall include the singular.
SECTION 3. ELIGIBILITY AND PARTICIPATION
3.1. Eligibility and Participation. Eligible Employees in the Plan
shall be selected by the Committee from among those officers and other key
employees of the Company and its Subsidiaries who, in the opinion of the
Committee, are in a position to contribute materially to the Company's continued
growth and development and to its long-term financial success.
SECTION 4. STOCK SUBJECT TO PLAN
4.1. Number. The total number of shares of Stock subject to issuance
under the Plan may not exceed 100,000 subject to adjustment upon occurrence of
any of the events indicated in Subsection 4.5. The maximum number of shares of
Stock with respect to which Options or Stock Appreciation Rights may be granted
to any Eligible Employee during the term of the Plan cannot exceed 10,000. The
shares to be delivered under the Plan may consist, in whole or in part, of
authorized but unissued Stock or treasury Stock, not reserved for any other
purpose.
4.2. Unused Stock; Unexercised Rights. In the event any shares of Stock
are subject to an Option, which for any reason, expires or is terminated
unexercised as to such shares, or any shares of Stock subject to a Restricted
Stock grant made under the Plan are reacquired by the Company pursuant to
Section 9 of the Plan, such shares again shall become available for issuance
under the Plan.
4.3. Exercise of Stock Appreciation Right. Whenever a Stock
Appreciation Right, other than a Stock Appreciation Right described in Section
8.1(a)(ii), is exercised and payment of the amount determined in Subsection
8.l(b) is made in cash, the shares of Stock allocable to the portion of the
Option surrendered may again be the subject of Options or Restricted Stock
hereunder. Whenever a Stock Appreciation Right is exercised and payment of the
amount determined in Subsection 8.1(b) is made in shares of Stock or any Stock
Appreciation Right described in Section 8.1(a)(ii) is exercised, no shares of
Stock with respect to which the Stock Appreciation Right is exercised may again
be the subject of Options or Restricted Stock hereunder.
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156
4.4. Restricted Stock. Whenever any shares of Stock granted to an
Eligible Employee are forfeited pursuant to Section 9 herein, such shares may
again be the subject of Options or Restricted Stock hereunder, but only if the
Participant had not been paid any dividend or received any other benefit of
ownership of such forfeited shares.
4.5. Adjustment in Capitalization.
(a) In the event of a Change in Capitalization, the Committee shall
conclusively determine the appropriate adjustments, if any, to the (i) maximum
number and class of shares of Stock or other securities with respect to which
Options or Restricted Stock may be granted under the Plan; (ii) the number and
class of shares of Stock or other securities which are subject to outstanding
Options or Restricted Stock granted under the Plan, and the purchase price
therefor, if applicable; and (iii) the maximum number of shares of Stock or
other securities with respect to which Options or Stock Appreciation Rights may
be granted to any Eligible Employee during the term of the Plan.
(b) Any such adjustment in the shares of Stock or other securities
subject to outstanding incentive stock options (including any adjustments in the
purchase price) shall be made in such manner as not to constitute a modification
as defined by Section 424(h)(3) of the Code and only to the extent otherwise
permitted by Sections 422 and 424 of the Code.
(c) If, by reason of a Change in Capitalization, a grantee of
Restricted Stock shall be entitled to, or an Optionee shall be entitled to
exercise an Option with respect to, new, additional or different shares of stock
or securities, such new additional or different shares shall thereupon be
subject to all of the conditions, restrictions and performance criteria which
were applicable to the Restricted Stock or shares of Stock subject to the
Option, as the case may be, prior to such Change in Capitalization.
SECTION 5. DURATION OF PLAN
5.1. Duration of Plan. The Plan shall remain in effect, subject to the
Board's right to earlier terminate the Plan pursuant to Subsection 12.3 hereof,
until all Stock subject to it shall have been purchased or acquired pursuant to
the provisions hereof. Notwithstanding the foregoing, no Option or Restricted
Stock may be granted under the Plan on or after the tenth anniversary of the
Consummation Date.
SECTION 6. OPTION GRANTS FOR ELIGIBLE EMPLOYEES
6.1. Grant of Employee Options. Subject to the provisions of Sections 4
and 5, Employee Options may be granted to Eligible Employees at any time and
from time to time as shall be determined by the Committee. The Committee shall
have complete discretion consistent with the terms of the Plan in determining
whether to grant Employee Options and the number of Options granted to each
Eligible Employee. The Committee also shall determine whether an Employee Option
is to be an incentive stock option within the meaning of Section 422 of the Code
or a nonstatutory stock option. Nothing in this Section 6 of the Plan shall be
deemed to prevent the grant of nonstatutory stock options in excess of the
maximum established by Section 422 of the Code.
6.2. Option Agreement. Each Employee Option shall be evidenced by an
Option Agreement that shall specify the type of Option granted, the Option
Price, the duration of the Option, the number of shares of Stock to which the
Option pertains and such other provisions as the Committee shall determine.
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6.3. Option Price. The Option Price for each Employee Option shall be
determined by, or in the manner specified by, the Committee; provided, however,
that no Employee Option shall have an Option Price that is less than the Fair
Market Value of the Stock on the date the Option is granted (110% of Fair Market
Value in the case of an incentive stock option granted to any person who, within
the meaning of Section 422 of the Code, owns stock possessing more than ten
(10%) percent of the total combined voting power of all classes of stock of the
Company or any Subsidiary (a "Ten Percent Stockholder")).
6.4. Duration of Employee Options. Each Employee Option shall expire at
such time as the Committee shall determine at the time it is granted; provided,
however, that no Employee Option shall be exercisable later than the tenth
anniversary date of its grant (the fifth anniversary in the case of an incentive
stock option granted to a Ten Percent Stockholder).
6.5. Exercise of Employee Options; Vesting. Employee Options granted
under the Plan shall be exercisable at such times and be subject to such vesting
schedules, restrictions and conditions as the Committee shall in each instance
approve, which need not be the same for all Eligible Employees; provided,
however, that in no event shall a Participant's rights to exercise such Options
vest more rapidly than 33 1/3% annually, beginning on the first anniversary date
following the granting of such Option.
SECTION 7. TERMS AND CONDITIONS APPLICABLE TO ALL OPTIONS
7.1. Payment. The Option Price shall be payable to the Company in full
upon exercise of an Option either (i) in cash or its equivalent, or (ii) at the
discretion of the Committee, by tendering shares of Stock held by the Optionee
for more than six (6) months having a Fair Market Value at the time of exercise
equal to the Option Price or (iii) by a combination of (i) and (ii). The
proceeds from such a payment shall be added to the general funds of the Company
and shall be used for general corporate purposes.
7.2. Restrictions on Stock Transferability. The Committee may impose
such restrictions on any shares of Stock acquired pursuant to the exercise of an
Option under the Plan as it may deem advisable, including, without limitation,
restrictions under applicable Federal securities law, under requirements of any
stock exchange upon which such shares of Stock are then listed and under any
blue sky or state securities laws applicable to such shares.
7.3. Termination of Employment Due to Retirement or Voluntary or
Involuntary Separation. The Committee may provide in the Option Agreement that
(i) in the event the employment of the Optionee is terminated by reason of
Retirement, any outstanding Options granted to the Optionee which are then
exercisable shall continue to be exercisable at any time prior to the earlier of
the expiration date of the Options and one year after the date of termination,
or (ii) in the event that the employment of the Optionee is terminated for any
reason other than Retirement, death, Disability or Cause (as defined in Section
7.5), any outstanding options granted to the Optionee which are then exercisable
may continue to be exercisable until the earlier of the expiration date of such
Options and three months after the date of termination. Any Options not
exercisable upon Retirement or other termination except due to death or
Disability shall terminate immediately.
7.4. Termination of Employment Due to Death or Disability. The
Committee may provide in the Option Agreement that in the event the employment
of the Optionee is terminated by reason of death or Disability, the rights under
any then outstanding Option granted to the Optionee pursuant to the Plan shall
become fully exercisable until the earlier of the expiration date of the Option
and one (1) year after the date of such termination, subject to such exceptions
(which shall be set forth in the Option Agreement) as the Committee may, in its
sole discretion, approve.
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158
7.5. Termination of Employment for Cause. Notwithstanding anything to
the contrary herein, if the employment of the Optionee shall terminate for Cause
(as defined herein), any then outstanding Option granted pursuant to the Plan to
the Optionee shall terminate immediately; provided, however, that the Committee
may waive, in whole or in part, the automatic forfeiture of such Employee
Options and may set forth such waiver or condition in the Option Agreement or at
any other time, including following the termination of employment. For purposes
of this Plan, "Cause" means the Optionee's knowingly or recklessly causing
material injury to the Company, the Optionee's willful misconduct in the
performance of (or failure to perform) his duties hereunder, or the Optionee's
dishonest, fraudulent or unlawful behavior involving moral turpitude whether or
not in connection with his employment.
7.6. Non-transferability and Exercisability of Options. No Option
granted under the Plan may be sold, transferred, pledged, assigned or otherwise
alienated or hypothecated, otherwise than by will or by the laws of descent and
distribution. Further, all Options granted to an Optionee under the Plan shall
be exercisable during his lifetime only by such Optionee. Notwithstanding any
provision of the Plan to the contrary, no Option shall be exercisable prior to
the time a registration statement under the Securities Act of 1933 is effective
with respect to the shares of Stock issuable upon the exercise of such Option.
SECTION 8. STOCK APPRECIATION RIGHTS
8.1. Stock Appreciation Rights. The Committee may, in its discretion,
in connection with the grant of an Employee Option, grant to the Optionee Stock
Appreciation Rights, the terms and conditions of which shall be set forth in an
agreement as determined by the Committee. A Stock Appreciation Right shall cover
the same shares of Stock covered by the Option (or such lesser number of shares
of Stock as the Committee may determine) and shall, except as provided in this
Section 8, be subject to the same terms and conditions as the related Option.
Stock Appreciation Rights shall be subject to the following terms and
provisions:
(a) A Stock Appreciation Right may be granted:
(i) either at the time of grant, or at any time
thereafter during the term of the Option if related to a
nonstatutory stock option; or (ii) only at the time of grant
if related to an incentive stock option.
(b) A Stock Appreciation Right will entitle the holder of the
related Option, upon exercise of the Stock Appreciation Right, to
surrender such Option, or any portion thereof to the extent
unexercised, and to receive payment of an amount determined by
multiplying (i) the excess of the Fair Market Value of a share of
Stock on the date of exercise of such Stock Appreciation Right over
the purchase price of a share of Stock under the related Option, by
(ii) the number of shares as to which such Stock Appreciation Right
has been exercised. Notwithstanding the foregoing, the Committee may
limit in any manner the amount payable with respect to any Stock
Appreciation Right by including such a limit in the agreement
evidencing the Stock Appreciation Right at the time it is granted.
(c) A Stock Appreciation Right will be exercisable at such time
or times and only to the extent that a related Option is exercisable,
and will not be transferable except to the extent that such related
Option may be transferable. A Stock Appreciation Right granted in
connection with an incentive stock option shall be exercisable only if
the Fair Market Value of a share of Stock on the date of exercise
exceeds the purchase price of a share of Stock specified in the
related Option.
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159
(d) Upon the exercise of a Stock Appreciation Right, the related
Option shall be canceled to the extent of the number of shares of
Stock as to which the Stock Appreciation Right is exercised, and upon
the exercise of an Option granted in connection with a Stock
Appreciation Right, the Stock Appreciation Right shall be canceled to
the extent of the number of shares of Stock as to which the Option is
exercised or surrendered.
(e) Stock Appreciation Rights shall be exercised by an Optionee
only by a written notice delivered in person or by mail to the
Secretary of the Company at the Company's principal executive office,
specifying the number of shares of Stock with respect to which the
Stock Appreciation Right is being exercised. If requested by the
Committee, the Optionee shall deliver the agreement evidencing the
Stock Appreciation Right being exercised and the agreement evidencing
any related Option to the Secretary of the Company who shall endorse
thereon a notation of such exercise and return such agreement to the
Optionee.
(f) Payment of the amount determined under Section 8.1(b) may be
made by the Company in the discretion of the Committee, solely in
whole shares of Stock in a number determined at their Fair Market
Value on the date preceding the date of exercise of the Stock
Appreciation Right, or solely in cash, or in a combination of cash and
Stock. If the Committee decides to make full payment in Stock and the
amount payable results in a fractional share, payment for the
fractional share will be made in cash. Notwithstanding the foregoing,
no payment in the form of cash may be made upon the exercise of a
Stock Appreciation Right to an officer of the Company or a Subsidiary
who is subject to Section 16 of the Exchange Act, unless the exercise
of such Stock Appreciation Right is made either (i) during the period
beginning on the third business day and ending on the twelfth business
day following the date of release for publication of the Company's
quarterly or annual statements of sales and earnings or (ii) pursuant
to an irrevocable election to receive cash made at least six (6)
months prior to the exercise of such Stock Appreciation Right.
(g) No Stock Appreciation Right may be exercised before the date
six (6) months after the date it is granted.
(h) Subject to the terms of the Plan, the Committee may modify
outstanding awards of Stock Appreciation Rights or accept the
surrender of outstanding awards of Stock Appreciation Rights (to the
extent not exercised) and grant new awards in substitution for them.
Notwithstanding the foregoing, no modification of an award of Stock
Appreciation Rights shall adversely alter or impair any rights or
obligations under the agreement granting such Stock Appreciation
Rights without the Optionee's consent.
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160
SECTION 9. RESTRICTED STOCK
9.1. Grant of Restricted Stock; Vesting. Subject to the provisions of
Sections 4 and 5, the Committee, at any time and from time to time, may grant
shares of Restricted Stock under the Plan to such Eligible Employees and in such
amounts as it shall determine in its sole discretion. Each grant of Restricted
Stock shall be made pursuant to a written agreement which shall contain such
restrictions, terms and conditions as the Committee may determine in its
discretion. Restrictions upon shares of Restricted Stock shall lapse at such
time or times and on such terms and conditions as the Committee may determine;
provided, however, that in no event shall such restrictions on vesting lapse at
a rate more rapidly, on an annual basis, than 33 1/3% of the number of shares
such Restricted Stock subject to such grant beginning on the first anniversary
date following the grant of such Restricted Stock.
9.2. Transferability. Except as provided in this Section 9, the shares
of Restricted Stock granted hereunder may not be sold, transferred, pledged,
assigned or otherwise alienated or hypothecated for such period of time as shall
be determined by the Committee and shall be specified in the Restricted Stock
grant, or upon earlier satisfaction of other conditions as specified by the
Committee in its sole discretion and set forth in the Restricted Stock grant;
provided, however, that Restricted Stock granted to officers, directors or any
person who owns, directly or indirectly, more than ten (10%) percent of any
class of equity security of the Company which is registered pursuant to Section
13 of the Act may not be sold for at least six (6) months after the date of
grant.
9.3. Other Restrictions. The Committee may impose such other
restrictions on any shares of Restricted Stock granted to any Eligible Employee
pursuant to the Plan as it may deem advisable including, without limitation,
restrictions under applicable federal or state securities laws, and may legend
the certificates representing Restricted Stock to give appropriate notice of
such restrictions.
9.4. Certificate Legend. In addition to any legends placed on
certificates pursuant to Subsection 9.3 hereof, each certificate representing
shares of Restricted Stock granted pursuant to the Plan shall bear the following
legend:
"The sale or other transfer of the shares of stock
represented by this certificate, whether voluntary,
involuntary or by operation of law, is subject to
certain restrictions on transfer set forth in the
Reinhold Industries, Inc. Stock Incentive Plan, rules
of administration adopted pursuant to such Plan and a
Restricted Stock grant dated . A copy of the Plan, such
rules and such Restricted Stock grant may be obtained
from the Secretary of Reinhold Industries, Inc."
9.5. Removal of Restrictions. Except as otherwise provided in this
Section 9, shares of Restricted Stock covered by each Restricted Stock grant
made under the Plan shall become freely transferable by the Eligible Employee
after the last day of the Period of Restriction. Once the shares are released
from the restrictions, the Eligible Employee shall be entitled to have the
legend required by Subsection 9.4 removed from his or her Stock certificate.
9.6. Voting Rights. During the Period of Restriction, Eligible
Employees holding shares of Restricted Stock granted hereunder may exercise full
voting rights with respect to those shares.
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161
9.7. Dividends and Other Distributions. During the Period of
Restriction, Eligible Employees holding shares of Restricted Stock granted
hereunder shall be entitled to receive all dividends and other distributions
paid with respect to those shares while they are so held. If any such dividends
or distributions are paid in shares of Stock, the shares shall be subject to the
same restrictions on transferability as the shares of Restricted Stock with
respect to which they were paid.
SECTION 10. BENEFICIARY DESIGNATION
10.1. Beneficiary Designation. Subject to Subsections 7.6 and 9.2, each
Participant under the Plan may, from time to time, name any beneficiary or
beneficiaries (who may be named contingently or successively) to whom any
benefit under the Plan is to be paid in case of the Participant's death before
he or she receives any or all of such benefit. Each designation will revoke all
prior designations by the same Participant, shall be in a form prescribed by the
Committee and will be effective only when filed by the Participant in writing
with the Committee during the lifetime of the Participant. In the absence of any
such designation, benefits remaining unpaid at the Participant's death shall be
paid to the estate of the Participant.
SECTION 11. RIGHTS OF EMPLOYEES
11.1. Employment. The selection of any person to receive an Option,
Stock Appreciation Right or Restricted Stock hereunder shall not interfere with
or limit in any way the right of the Company or any Subsidiary to terminate such
Participant's employment at any time and shall not give such Participant any
right to continue as an employee of the Company or any Subsidiary.
11.2. Participation. No employee shall have a right to be selected as
an Eligible Employee or, having been so selected, to be selected again as an
Optionee or recipient of Restricted Stock. Each grant of Options or Restricted
Stock hereunder shall be separate and distinct from every other grant and shall
not be construed either to give or deny the grantee the right to be granted
additional benefits under the Plan.
11.3. Plan Not Exclusive. The Plan is not exclusive. The Company may
have other plans, programs and arrangements for the grant of options, the
issuance of shares or other compensation. The Plan does not require that any
Optionee or holder of Restricted Stock participate, or be precluded from
participation, in such other plans, programs and arrangements.
SECTION 12. ADMINISTRATION; POWERS AND DUTIES OF THE COMMITTEE
12.1. Administration. The Committee shall be responsible for the
administration of the Plan. The Committee, by majority action thereof, is
authorized to interpret the Plan, to prescribe, amend, and rescind rules and
regulations relating to the Plan, to provide for conditions and assurances
deemed necessary or advisable to protect the interests of the Company, and to
make all other determinations necessary or advisable for the administration of
the Plan, but only to the extent not contrary to the express provisions of the
Plan. Determinations, interpretations, or other actions made or taken by the
Committee pursuant to the provisions of the Plan shall be final and binding and
conclusive for all purposes and upon all persons whomsoever. No member of the
Committee shall be personally liable for any action, determination or
interpretation made or taken with respect to the Plan and all members of the
Committee shall be fully indemnified by the Company with respect to any such
action, determination or interpretation.
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162
12.2. Change in Control. Without limiting the authority of the
Committee as provided herein, the Committee, either at the time Employee Options
or shares of Restricted Stock are granted, or, if so provided in the applicable
Option Agreement or Restricted Stock grant, at any time thereafter, shall [have
the authority to] accelerate in whole or in part the exercisability of Employee
Options and/or the last day of the Period of Restriction upon a Change in
Control. The Option Agreements and Restricted Stock grants approved by the
Committee may contain provisions whereby, in the event of a Change in Control,
the acceleration of the exercisability of Employee Options and/or the last day
of the Period of Restriction may be automatic or may be subject to the
discretion of the Committee or may depend upon whether the Change in Control
shall be approved by a majority of the members of the Board or such other
criteria as the Committee may specify. Nothing herein shall obligate the
Committee to take any action upon a Change in Control.
12.3. Amendment, Modification and Termination of Plan. The Board may at
any time terminate, and from time to time may amend or modify the Plan;
provided, however, that no such action of the Board, without approval of the
stockholders, may:
(a) Increase the total amount of Stock which may be issued under
the Plan, except as provided in Subsection 4.5 of the Plan.
(b) Materially increase the cost of the Plan or materially
increase the benefits to Participants.
(c) Extend the period during which Options or Restricted Stock
may be granted.
(d) Extend the maximum period after the date of grant during
which Options may be exercised.
(e) Change the class of individuals eligible to receive Options
or Restricted Stock.
Any amendment which requires stockholder approval in order for the Plan
to continue to comply with Rule 16b-3 of the Act or any other law, regulation or
stock exchange requirement shall not be effective unless approved by the
requisite vote of stockholders. No amendment, modification or termination of the
Plan shall in any manner adversely affect any Options or Restricted Stock
theretofore granted to any Participant under the Plan, without the consent of
that Participant.
12.4. Interpretation. Unless otherwise expressly stated in the
agreement governing, any grant of Options, Stock Appreciation Rights and
Restricted Stock, such grant, as the case may be, is intended to be compensation
within the meaning of Section 162(m)(4)(C) of the Code. The Committee shall not
be entitled to exercise any discretion otherwise authorized hereunder with
respect to such Options if the ability to exercise such discretion or the
exercise of such discretion itself would cause the compensation attributable to
such Options to fail to qualify as such compensation.
SECTION 13. TAX WITHHOLDING
13.1. Tax Withholding. (a) At such times as an Eligible Employee
recognizes taxable income in connection with the receipt of shares or cash
hereunder (a "Taxable Event"), the Eligible Employee shall pay to the Company an
amount equal to the federal, state and local income taxes and other amounts as
may be required by law to be withheld by the Company in connection with the
Taxable Event (the "Withholding Taxes") prior to the issuance, or release from
escrow, of such shares or the payment of such cash. The Company shall have the
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163
right to deduct from any payment of cash to an Eligible Employee an amount equal
to the Withholding Taxes in satisfaction of the obligation to pay Withholding
Taxes. In satisfaction of his obligation to pay Withholding Taxes to the
Company, the Eligible Employee may make a written election (the "Tax Election"),
which may be accepted or rejected in the discretion of the Committee, to have
withheld a portion of the shares of Stock then issuable to him having an
aggregate Fair Market Value, on the date preceding the date of such issuance,
equal to the Withholding Taxes, provided that in respect of an Eligible Employee
who may be subject to liability under Section 16(b) of the Exchange Act either:
(i) the Tax Election is made at least six (6) months prior to the date of the
Taxable Event and the Tax Election is irrevocable with respect to all Taxable
Events of a similar nature occurring prior to the expiration of six (6) months
following a revocation of the Tax Election; or (ii) in the case of the exercise
of an Option (A) the Optionee makes the Tax Election at least six (6) months
after the date the Option was granted, (B) the Option is exercised during the
ten (10) day period beginning on the third business day and ending on the
twelfth business day following the release for publication of the Company's
quarterly or annual statement of sales and earnings (a "Window Period") and (C)
the Tax Election is made during the Window Period in which the related Option is
exercised or prior to such Window Period and subsequent to the immediately
preceding Window Period; or (iii) in the case of a Taxable Event relating to the
grant of shares of Restricted Stock (A) the Eligible Employee makes the Tax
Election at least six (6) months after the date such stock was granted and (B)
the Tax Election is made (x) in the case of a Taxable Event occurring within a
Window Period, during the Window Period in which the Taxable Event occurs, or
(y) in the case of a Taxable Event not occurring within a Window Period, during
the Window Period immediately preceding the Taxable Event relating to such
Restricted Stock. Notwithstanding the foregoing, the Committee may, by the
adoption of rules or otherwise, (i) modify the provisions of this Section 13.1
or impose such other restrictions or limitations on Tax Elections as may be
necessary to ensure that the Tax Elections will be exempt transactions under
Section 16(b) of the Exchange Act, and (ii) permit Tax Elections to be made at
such other times and subject to such other conditions as the Committee
determines will constitute exempt transactions under Section 16(b) of the Act.
SECTION 14. REQUIREMENTS OF LAW
14.1. Requirements of Law. The granting of Options or Restricted Stock,
and the issuance of shares of Stock upon the exercise of an Option shall be
subject to all applicable laws, rules and regulations, and to such approvals by
any governmental agencies or national securities exchanges as may be required.
14.2. Governing Law. The Plan, and all agreements hereunder, shall be
construed in accordance with and governed by the laws of the State of New York
without giving effect to the choice of law principles thereof, except to the
extent that such law is preempted by federal law.
164
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
- - - - - - - - - - - - - - - - - - x
:
In re: :
:
KEENE CORPORATION, : Chapter 11
: Case No. 93-B-46090 (SMB)
Debtor. :
: Civil Action No.
: 96 CV 3492 (MBM)
- - - - - - - - - - - - - - - - - - x
MODIFICATIONS TO THE DEBTOR'S
FOURTH AMENDED PLAN OF REORGANIZATION
Keene Corporation, debtor and debtor in possession in the
above-captioned Chapter 11 case, hereby proposes the following modifications to
its Fourth Amended Plan of Reorganization (the "Plan")*, pursuant to section
1127(a) of the Bankruptcy Code.
1._______Section 1.1 of the Plan shall be modified as follows:
a. The following definition shall be added to Section 1.1: "(13)
"Asbestos related D&O Indemnification Obligations" means the Debtor's
obligations to indemnify its officers and directors pursuant to its
Certificate of Incorporation dated April 12, 1990 and Section 145 of the
Delaware General Corporation Law for Claims and Demands asserted by or on
behalf of a holder of an Asbestos-Related Claim or Demand."
b. Section 1.1(13) of the Plan shall be renumbered as Section 1.1(14)
of the Plan.
c. Section 1.1(14) of the Plan shall be renumbered as Section 1.1(15)
of the Plan.
d. Section 1.1(15) of the Plan shall be renumbered as Section 1.1(16)
of the Plan.
e. Section 1.1(16) of the Plan shall be renumbered as Section 1.1(17)
of the Plan.
f. Section 1.1(17) of the Plan shall be renumbered as Section 1.1(18)
of the Plan.
g. Section 1.1(18) of the Plan shall be renumbered as Section 1.1(19)
of the Plan.
- ---------------------------
1. All terms not otherwise defined herein shall have the meaning ascribed
thereto in the Plan.
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165
h. Section 1.1(19) of the Plan shall be renumbered as Section 1.1(20)
of the Plan.
i. Section 1.1(20) of the Plan shall be renumbered as Section 1.1(21)
of the Plan.
j. Section 1.1(21) of the Plan shall be renumbered as Section 1.1(22)
of the Plan.
k. Section 1.1(22) of the Plan shall be renumbered as Section 1.1(23)
of the Plan.
l. Section 1.1(23) of the Plan shall be renumbered as Section 1.1(24)
of the Plan.
m. Section 1.1(24) of the Plan shall be renumbered as Section 1.1(25)
of the Plan.
n. Section 1.1(25) of the Plan shall be renumbered as Section 1.1(26)
of the Plan.
o. Section 1.1(26) of the Plan shall be renumbered as Section 1.1(27)
of the Plan.
p. Section 1.1(27) of the Plan shall be renumbered as Section 1.1(28)
of the Plan.
q. Section 1.1(28) of the Plan shall be renumbered as Section 1.1(29)
of the Plan.
r. Section 1.1(29) of the Plan shall be renumbered as Section 1.1(30)
of the Plan.
s. Section 1.1(30) of the Plan shall be renumbered as Section 1.1(31)
of the Plan.
t. Section 1.1(31) of the Plan shall be renumbered as Section 1.1(32)
of the Plan.
u. Section 1.1(32) of the Plan shall be renumbered as Section 1.1(33)
of the Plan.
v. Section 1.1(33) of the Plan shall be renumbered as Section 1.1(34)
of the Plan.
w. Section 1.1(34) of the Plan shall be renumbered as Section 1.1(35)
of the Plan.
x. Section 1.1(35) of the Plan shall be renumbered as Section 1.1(36)
of the Plan.
y. Section 1.1(36) of the Plan shall be renumbered as Section 1.1(37)
of the Plan.
z. Section 1.1(37) of the Plan shall be renumbered as Section 1.1(38)
of the Plan.
aa. Section 1.1(38) of the Plan shall be renumbered as Section 1.1(39)
of the Plan and shall be modified by deleting the phrase "three (3)
calendar days" therefrom and inserting in lieu thereof the phrase "one (1)
calendar day."
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166
ab. Section 1.1(39) of the Plan shall be renumbered as Section 1.1(40)
of the Plan.
ac. Section 1.1(40) of the Plan shall be renumbered as Section 1.1(41)
of the Plan.
ad. The following definition shall be added to Section 1.1:
"(42) "Confirmation Trigger" means the entry of a
Confirmation Order that in any way materially and adversely
affects Sections 17.1, 17.3(b) or 17.4 of the Plan from the
perspective of the Debtor's present and former officers and
directors."
ae. Section 1.1(41) of the Plan shall be renumbered as Section 1.1(43)
of the Plan.
af. Section 1.1(42) of the Plan shall be renumbered as Section 1.1(44)
of the Plan.
ag. Section 1.1(43) of the Plan shall be renumbered as Section 1.1(45)
of the Plan.
ah. Section 1.1(44) of the Plan shall be renumbered as Section 1.1(46)
of the Plan.
ai. Section 1.1(45) of the Plan shall be renumbered as Section 1.1(47)
of the Plan.
aj. Section 1.1(46) of the Plan shall be renumbered as Section 1.1(48)
of the Plan and shall be modified by (a) deleting the word "and" in the
third line thereof and inserting in lieu thereof "," and (b) inserting at
the end thereof the phrase ", (iv) the Other Retiree Benefit Expense Amount
and (v) the Special Reserve, if any."
ak. Section 1.1(47) of the Plan shall be renumbered as Section 1.1(49)
of the Plan and shall be modified by (a) deleting the word "and" in the
fifth line thereof and inserting in lieu thereof "," and (b) inserting
after the phrase "the Plan Estimates" in the fifth line thereof the phrase
", the Other Retiree Benefit Expense Amount".
al. Section 1.1(48) of the Plan shall be renumbered as Section 1.1(50)
of the Plan.
am. Section 1.1(49) of the Plan shall be renumbered as Section 1.1(51)
of the Plan.
an. Section 1.1(50) of the Plan shall be renumbered as Section 1.1(52)
of the Plan.
ao. Section 1.1(51) of the Plan shall be renumbered as Section 1.1(53)
of the Plan.
ap. Section 1.1(52) of the Plan shall be renumbered as Section 1.1(54)
of the Plan.
aq. Section 1.1(53) of the Plan shall be renumbered as Section 1.1(55)
of the Plan.
ar. Section 1.1(54) of the Plan shall be renumbered as Section 1.1(56)
of the Plan.
<PAGE>
167
as. Section 1.1(55) of the Plan shall be renumbered as Section 1.1(57)
of the Plan.
at. Section 1.1(56) of the Plan shall be renumbered as Section 1.1(58)
of the Plan.
au. Section 1.1(57) of the Plan shall be renumbered as Section 1.1(59)
of the Plan.
av. Section 1.1(58) of the Plan shall be renumbered as Section 1.1(60)
of the Plan.
aw. Section 1.1(59) of the Plan shall be renumbered as Section 1.1(61)
of the Plan.
ax. Section 1.1(60) of the Plan shall be renumbered as Section 1.1(62)
of the Plan.
ay. Section 1.1(61) of the Plan shall be renumbered as Section 1.1(63)
of the Plan.
az. Section 1.1(62) of the Plan shall be renumbered as Section 1.1(64)
of the Plan.
ba. Section 1.1(63) of the Plan shall be renumbered as Section 1.1(65)
of the Plan.
bb. Section 1.1(64) of the Plan shall be renumbered as Section 1.1(66)
of the Plan.
bc. Section 1.1(65) of the Plan shall be renumbered as Section 1.1(67)
of the Plan.
bd. Section 1.1(66) of the Plan shall be renumbered as Section 1.1(68)
of the Plan.
be. Section 1.1(67) of the Plan shall be renumbered as Section 1.1(69)
of the Plan.
bf. Section 1.1(68) of the Plan shall be renumbered as Section 1.1(70)
of the Plan.
bg. Section 1.1(69) of the Plan shall be renumbered as Section 1.1(71)
of the Plan.
bh. Section 1.1(70) of the Plan shall be renumbered as Section 1.1(72)
of the Plan.
bi. Section 1.1(71) of the Plan shall be renumbered as Section 1.1(73)
of the Plan.
bj. Section 1.1(73) of the Plan shall be renumbered as Section 1.1(74)
of the Plan.
bk. Section 1.1(74) of the Plan shall be renumbered as Section 1.1(75)
of the Plan.
bl. Section 1.1(75) of the Plan shall be renumbered as Section 1.1(76)
of the Plan.
<PAGE>
168
bm. The following definition shall be added to Section 1.1: "(77)
"Modified Retention Costs" means the increased costs of the Retention
Program resulting from the fourth decretal paragraph of the Bankruptcy
Court's Order Approving Modifications To The Debtor's Existing Retention
Program, dated May 22, 1996."
bn. Section 1.1(76) of the Plan shall be renumbered as Section 1.1(78)
of the Plan.
bo. Section 1.1(77) of the Plan shall be renumbered as Section 1.1(79)
of the Plan.
bp. Section 1.1(78) of the Plan shall be renumbered as Section 1.1(80)
of the Plan.
bq. Section 1.1(79) of the Plan shall be renumbered as Section 1.1(81)
of the Plan.
br. The following definition shall be added to Section 1.1: "(82)
"Non-Asbestos Related D&O Indemnification Obligations" means the Debtor's
obligations to indemnify its officers and directors pursuant to its
Certificate of Incorporation dated April 12, 1990 and Section 145 of the
Delaware General Corporation Law for Claims asserted by or on behalf of any
Entity other than a holder of an Asbestos-Related Claim or Demand".
bs. Section 1.1(80) of the Plan shall be renumbered as Section 1.1(83)
of the Plan.
bt. Section 1.1(81) of the Plan shall be renumbered as Section 1.1(84)
of the Plan.
bu. The following definition shall be added to Section 1.1: "(85)
"Other Retiree Benefit Expense Amount" means $100,000.00 in Cash."
bv. The following definition shall be added to Section 1.1: "(86)
"Other Retiree Benefits" means the Debtor's obligations to (a) 110 of its
former employees to provide certain life insurance benefits, with a maximum
death benefit at $5,000.00 and (b) Howard A. Mileaf and Leroy Moeser with
respect to their non-qualified, supplemental retiree benefits."
bw. Section 1.1(82) of the Plan shall be renumbered as Section 1.1(87)
of the Plan.
bx. Section 1.1(83) of the Plan shall be renumbered as Section 1.1(88)
of the Plan.
by. Section 1.1(84) of the Plan shall be renumbered as Section 1.1(89)
of the Plan.
bz. Section 1.1(85) of the Plan shall be renumbered as Section 1.1(90)
of the Plan.
ca. Section 1.1(86) of the Plan shall be renumbered as Section 1.1(91)
of the Plan.
cb. Section 1.1(87) of the Plan shall be renumbered as Section 1.1(92)
of the Plan.
cc. Section 1.1(88) of the Plan shall be renumbered as Section 1.1(93)
of the Plan.
<PAGE>
169
cd. Section 1.1(89) of the Plan shall be renumbered as Section 1.1(94)
of the Plan.
ce. Section 1.1(90) of the Plan shall be renumbered as Section 1.1(95)
of the Plan.
cf. Section 1.1(91) of the Plan shall be renumbered as Section 1.1(96)
of the Plan.
cg. Section 1.1(92) of the Plan shall be renumbered as Section 1.1(97)
of the Plan.
ch. Section 1.1(93) of the Plan shall be renumbered as Section 1.1(98)
of the Plan.
ci. Section 1.1(94) of the Plan shall be renumbered as Section 1.1(99)
of the Plan.
cj. Section 1.1(95) of the Plan shall be renumbered as Section
1.1(100) of the Plan.
ck. Section 1.1(96) of the Plan shall be renumbered as Section
1.1(101) of the Plan.
cl. Section 1.1(97) of the Plan shall be renumbered as Section
1.1(102) of the Plan.
cm. Section 1.1(98) of the Plan shall be renumbered as Section
1.1(103) of the Plan.
cn. Section 1.1(99) of the Plan shall be renumbered as Section
1.1(104) of the Plan.
co. Section 1.1(100) of the Plan shall be renumbered as Section
1.1(105) of the Plan.
cp. Section 1.1(101) of the Plan shall be renumbered as Section
1.1(106) of the Plan.
cq. Section 1.1(102) of the Plan shall be renumbered as Section
1.1(107) of the Plan.
cr. Section 1.1(103) of the Plan shall be renumbered as Section
1.1(108) of the Plan.
cs. The following definition shall be added to Section 1.1:
"(109) "Special Reserve" means the reserve of $400,000.00 in
Cash to be established by the Creditors' Trust pursuant to
Section 9.14 hereof for the benefit of New Keene, which shall
have access thereto in order to satisfy its obligations under
Section 10.6(b) hereof. The Special Reserve shall be administered
by the Trustees in accordance with those agreements that the
Debtor and the Committee determine are necessary to effectuate
the Special Reserve."
ct. Section 1.1(104) of the Plan shall be renumbered as Section
1.1(110) of the Plan.
cu. Section 1.1(105) of the Plan shall be renumbered as Section
1.1(111) of the Plan.
<PAGE>
170
cv. Section 1.1(106) of the Plan shall be renumbered as Section
1.1(112) of the Plan.
cw. Section 1.1(107) of the Plan shall be renumbered as Section
1.1(113) of the Plan.
cx. Section 1.1(108) of the Plan shall be renumbered as Section
1.1(114) of the Plan.
cy. Section 1.1(109) of the Plan shall be renumbered as Section
1.1(115) of the Plan.
cz. Section 1.1(110) of the Plan shall be renumbered as Section
1.1(116) of the Plan.
da. Section 1.1(111) of the Plan shall be renumbered as Section
1.1(117) of the Plan.
db. Section 1.1(112) of the Plan shall be renumbered as Section
1.1(118) of the Plan.
dc. Section 1.1(113) of the Plan shall be renumbered as Section
1.1(119) of the Plan.
dd. Section 1.1(114) of the Plan shall be renumbered as Section
1.1(120) of the Plan.
de. Section 1.1(115) of the Plan shall be renumbered as Section
1.1(121) of the Plan.
df. Section 1.1(116) of the Plan shall be renumbered as Section
1.1(122) of the Plan.
dg. Section 1.1(117) of the Plan shall be renumbered as Section
1.1(123) of the Plan.
dh. Section 1.1(118) of the Plan shall be renumbered as Section
1.1(124) of the Plan.
2. Section 7.7 of the Plan shall be modified by (a) deleting the "."
and inserting "," after the phrase "in the aggregate" in the third line thereof,
and (b) adding, after ",", the phrase "provided, however, that no portion of
such available funds shall be used to satisfy any Claims arising under section
502(h) of the Bankruptcy Code, which Claims shall be treated in accordance with
Section 9.3 hereof."
3. Section 9.3 of the Plan shall be modified by (a) deleting the word
"and" in the fourth line thereof and inserting "," in lieu thereof, (b) adding
the phrase ", Asbestos Related D&O Indemnification Obligations" after the phrase
"Transactions Stipulation Claims" in the fourth line thereof, (c) adding the
phrase "and any and all liabilities of the Debtor under Section 502(h) of the
Bankruptcy Code, which shall be payable in the same percentage per dollar amount
of Claim as paid to the holders of Allowed General Unsecured Claims in Class 6"
after the phrase "Section 524(g) of the Bankruptcy Code" and before the ".", (d)
deleting the word "or" in the sixth line thereof, inserting "," in lieu thereof
and (e) adding the phrase "or any Claims arising under Section 502(h) of the
Bankruptcy Code.".
4. Article IX of the Plan shall be modified by adding the following new
Sections 9.14 and 9.15 thereto: "9.14 Special Reserve. If and only if the
Confirmation Trigger occurs, on the Effective Date, the Special Reserve shall be
created, established and administered by the Creditors' Trust.
<PAGE>
171
"9.15 Indemnification of Committee. The Creditors' Trust
shall indemnify each Entity who was or is a member of the
Committee and each of their respective representatives against
any and all liabilities, expenses, claims, damages or losses
incurred by them resulting from the fact that such Entity was a
member of the Committee or a representative thereof if such
Entity acted in good faith or in a manner he or she reasonably
believed to be in discharge of his or her duties."
5. Article X of the Plan shall be modified by adding the following new
Section 10.6 thereto:
"10.6 Assumption of Liabilities by New Keene.
(a) If and only if the Confirmation Trigger occurs, New Keene
shall assume and be obligated for the Modified Retention Costs.
(b) New Keene shall assume any and all Non-Asbestos Related D&O
Indemnification Obligations; provided, however, that if the
Confirmation Trigger occurs, the Special Reserve shall be created and
established.
(c) New Keene shall assume all liabilities relating to the Other
Retiree Benefits; provided, however, that New Keene shall receive the
Other Retiree Benefit Expense Amount."
6. Article X of the Plan shall be modified by adding the following new
Section 10.7 thereto:
"10.7 Transfer of Property to New Keene. On the Effective
Date, New Keene shall receive the Other Retiree Benefit Expense
Amount."
7. Section 12.2 of the Plan shall be modified by (a) deleting the word
"and" at the end of subsection (i), (b) deleting the period at the end of
subsection (j) and adding in lieu thereof a semicolon and the word "and", and
(c) inserting new subsection (k): "(k) "The Debtor and the Committee shall have
executed the agreement or agreements, in form and substance reasonably
acceptable to the parties, creating and establishing the Special Reserve."
8. Section 14.5 of the Plan shall be modified by adding the following
paragraph at the end thereof:
"The Other Retiree Benefits shall be treated in accordance
with Section 10.7 hereof."
9. Section 16.2 shall be modified by deleting the phrase "by the
Debtor, the Committee or the Legal Representative (each, an "Objecting Party"),
as the case may be, on or before the Confirmation Date, or such later date, as
the Bankruptcy Court may fix;" and inserting in lieu thereof, the following
phrase "within thirty (30) days after the Confirmation Date, or such later date
as the Bankruptcy Court may fix;"
Dated: New York, New York
June 10, 1996
KEENE CORPORATION
By: /S/ TIMOTHY E. COYNE
-----------------------------------
Name: Timothy E. Coyne
Title: President
<PAGE>
172
BERLACK, ISRAELS & LIBERMAN LLP
Counsel to Keene Corporation,
Debtor and Debtor in Possession
120 West 45th Street
New York, New York 10036
(212) 704-0100
By: /S/ EDWARD S. WEISFELNER
----------------------------------
Edward S. Weisfelner (EW 5581)
The foregoing modifications have been approved by the parties indicated
below, in accordance with Section 18.5 of the Plan.
The Official Committee of Unsecured Creditors
By: Marcus Montgomery P.C.
By: /S/ JOHN J. PREEFER
----------------------------------
The Legal Representative for
Future Claimants
By: /S/ MATTHEW GLUCK
----------------------------------
Matthew Gluck
173
SHARE AUTHORIZATION AGREEMENT
This Agreement, dated as of July 31, 1996, by and between Reinhold
Industries, Inc. ("Reinhold"), a Delaware corporation and Archie R. Dykes,
Richard A. Lippe and John J. Robbins, as trustees ("Trustees") of that certain
trust ("Creditors' Trust") established pursuant to Debtor's Fourth Amended Plan
of Reorganization, as modified ("Plan") of Keene Corporation, Debtor ("Debtor")
in Case No. 93 B 46090 (SMB), United States Bankruptcy Court, Southern District
of New York ("Bankruptcy Court").
W I T N E S S E T H :
WHEREAS, the United States District Court for the Southern District of
New York confirmed the Plan by order entered on June 14, 1996 and the Plan was
consummated on the Effective Date (as defined in the Plan); and
WHEREAS, Reinhold is successor-in-interest to Debtor and, pursuant to
the Plan, adopted an Amended and Restated Certificate of Incorporation of
Reinhold Industries, Inc. ("Certificate"); and
WHEREAS, the Certificate authorizes and, pursuant to the Plan, on the
Effective Date Reinhold issued to the Creditors' Trust 1,020,000 shares of the
Class B New Common Stock, par value $.01 ("Class B Common") of Reinhold; and
WHEREAS, the Certificate authorizes 1,480,000 shares of Class A New
Common Stock, par value $.01 ("Class A Common") of Reinhold, of which 980,000
shares of Class A Common are issued and outstanding on the Effective Date; and
WHEREAS, Section 8.2(iv) of the Plan provides that no additional shares
of Class A Common will be authorized or issued without the prior written consent
of the Creditors' Trust, provided that the Class B Common then outstanding
represents not less than ten (10%) percent of the aggregate number of the sum of
the shares of Class A Common and Class B Common (collectively, "New Common
Stock") then outstanding.
NOW, THEREFORE, the parties hereto, intending to be legally bound,
agree as follows:
1. (a) Without the prior written consent of the Trustees, which may be
withheld in their sole discretion, Reinhold shall not (i) amend its
Certificate to authorize any shares of Class A Common in excess of the
1,480,000 shares now authorized therein or (ii) issue any shares of Class A
Common in excess of the 980,000 shares now issued and outstanding;
provided, however, that Reinhold shall not be required to obtain such
written consent on or after the earliest date on which the number of shares
of Class B Common then outstanding is less than ten (10%) percent of the
total number of shares of New Common Stock.
2. (a) Reinhold acknowledges that this Agreement was negotiated as an
integral part of the Plan and that any breach of the restrictions set forth
herein will cause irreparable damage to the Creditors' Trust in its
capacity as a major shareholder of Reinhold.
(b) In the event of an actual or threatened breach by Reinhold of
the provisions of this Agreement, the Creditors' Trust shall be entitled to
an injunction restraining Reinhold from such violation, provided that
nothing set forth in this Section 2 shall be construed as prohibiting the
Creditors' Trust from pursuing any other legal or equitable remedies
available with respect to such breach, including the recovery of damages.
In addition, Reinhold shall be liable for any and all costs and damages,
including reasonable legal fees incurred by the Creditors' Trust, as a
result of any breach of the provisions of this Agreement.
<PAGE>
174
3. The Bankruptcy Court shall retain original jurisdiction over any
disputes or controversies arising under or in connection with this
Agreement.
4. The term of this Agreement shall commence on the Effective Date
and end on the earlier of (i) the date occurring ten years thereafter or
(ii) the earliest date described in Section 1(a).
5. (a) All notices, requests or other communications required or
permitted to be made in accordance with this Agreement shall be in writing
and shall be delivered personally or by digital facsimile transmission or
mailed by first class mail:
(i) if to Reinhold, to:
Reinhold Industries, Inc.
12827 East Imperial Highway
Santa Fe Springs, California 90670
Attention: President
(ii) if to the Creditors' Trust, to:
Creditors' Trust
c/o Hughes, Hubbard & Reed LLP
One Battery Park Plaza
New York, New York 10004-1482
(iii) Notices sent by facsimile transmission shall be deemed
delivered when actually received, and notices sent by first class mail
shall be deemed delivered three business days after mailing.
(b) Either party may change the address at which it is to receive
notices under this Agreement by furnishing written notice to the other in
accordance with the provisions of this Section 5(a).
6. (a) This Agreement may be executed in one or more counterparts,
each of which shall be deemed an original but which together shall
constitute but one and the same instrument.
(b) This Agreement shall be governed by, construed under and
interpreted in accordance with the laws of the State of New York, without
giving effect to principles of conflicts of law.
(c) Any provision of this Agreement which is prohibited or
unenforceable in any jurisdiction shall not invalidate the remaining
provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable any such
provision in any other jurisdiction.
(d) This Agreement may be amended, modified or terminated only by
written agreement executed by the parties hereto. This Agreement contains
the entire agreement and understanding between the parties related to the
subject matter hereof, and supersedes all prior agreements, understandings,
representations and warranties, whether written or oral, with respect
thereto.
<PAGE>
175
(e) This Agreement shall bind and inure to the benefit of the
parties hereto and their respective successors and assigns. Except as
required by applicable laws, the rights and obligations of each party
hereto may not be assigned, transferred or delegated by either party.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.
REINHOLD INDUSTRIES, INC.
By: /s/ Michael T. Furry
-----------------------------------------
KEENE CREDITORS' TRUST
By: /s/ Richard A. Lippe
-----------------------------------------
176
REGISTRATION RIGHTS AGREEMENT
REGISTRATION RIGHTS AGREEMENT, dated as of July 31, 1996, among
Reinhold Industries, Inc., a Delaware corporation (the "Company"), and that
certain trust (the "Creditors' Trust") established pursuant to the Debtor's
Fourth Amended Plan of Reorganization as modified ("Plan") of Keene Corporation,
which Plan has been filed by Keene Corporation in United States Bankruptcy Court
for the Southern District of New York (Case No. 93 B 46090) and confirmed by the
United States District Court for the Southern District of New York by order
entered on June 1, 1996.
1. Background. This Agreement is entered into pursuant to the Plan.
This Agreement shall become effective upon the issuance of the Class B New
Common Stock by Reinhold to the Creditors' Trust.
2. Registration under Securities Act.
2.1. Registration on Request. (a) Request. At any time subsequent to
the date occurring two (2) years following the Effective Date (as defined in the
Plan), the Creditors' Trust shall have the right to request in writing that the
Company use its best efforts to effect the registration under the Securities Act
of all or part of such holder's Registrable Securities; provided, however, that
the Company shall not be obligated to effect more than two registrations
pursuant to this Section 2.1 and not more than one registration in any twelve
(12) month period. The Company will use its best efforts to effect the
registration under the Securities Act of the Registrable Securities which the
Company has been so requested to register.
(b) Registration of Other Securities. Whenever the Company shall effect
a registration pursuant to this Section 2.1, no securities other than
Registrable Securities shall be included among the securities covered by such
registration unless the managing underwriter of such offering shall have advised
the Creditors' Trust that the inclusion of such other securities would not
adversely affect such offering.
(c) Registration Statement Form. Registrations under this Section 2.1
shall be on such appropriate registration form of the Commission (i) as shall be
selected by the Company and as shall be reasonably acceptable to the Creditors'
Trust; provided, however, that Form S-1 or any comparable successor form shall
be deemed acceptable and (ii) as shall permit the disposition of such
Registrable Securities in accordance with the intended method or methods of
disposition specified in their request for such registration.
(d) Expenses. The Company will pay all Registration Expenses incurred
in connection with the two registration requests pursuant to this Section 2.1,
other than the fees and expenses of counsel to the Creditors' Trust or the fees
and expenses of any other person retained by the Creditors' Trust and the
underwriting discounts and commissions and transfer taxes allocable to the
Registrable Securities being sold.
(e) Effective Registration Statement. A registration requested pursuant
to this Section 2.l shall not be deemed to have been effected (i) unless a
registration statement with respect thereto has become effective and, unless all
the securities registered thereby are theretofore sold, has remained effective
for at least 90 consecutive days, (ii) if after it has become effective, such
registration is interfered with by any stop order, injunction or other order or
requirement of the Commission or other governmental agency or court for any
reason, and the Registrable Securities covered thereby have not been sold, or
(iii) if the conditions to closing on the part of the underwriter with respect
to the Company specified in the selling agreement or underwriting agreement
entered into in connection with such registration are not satisfied or waived by
the underwriters. The Company shall not register the Registrable Securities on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act, or
any like registration form.
(f) Underwriters. If any registration effected pursuant to this Section
2.1 shall be a firm commitment or best efforts underwritten public offering, the
managing underwriter or underwriters thereof shall be selected by the Creditors'
Trust with the consent of the Company, which consent will not be unreasonably
withheld.
<PAGE>
177
(g) Apportionment in Registrations Requested. If, in connection with a
registration requested pursuant to this Section 2.1, the managing underwriter
shall advise the Company in writing that, in its opinion, marketing factors
require a delay in the offering or a limitation of the number of shares to be
underwritten below the number of shares requested to be included in such
registration or the number of securities requested to be included in such
registration exceeds the number which can be sold in such offering within a
price range acceptable to the Creditors' Trust requested to be included in such
registration, the Company will include in such registration the number of shares
that the Company is so advised can be sold in such offering. In connection with
any registration as to which the provisions of this clause (g) apply, no
securities other than Registrable Securities shall be covered by such
registration and if the aforesaid results in the exclusion of in excess of 50%
of the Registrable Securities originally sought to be registered and the holders
of Registrable Securities elect not to proceed, the request shall not be counted
for purposes of determining the number of registrations pursuant to Section 2.1
hereof. If a registration pursuant to this clause (g) includes securities of
other persons in accordance with Section 2.1(b) hereof and the managing
underwriter concludes that preceding criteria is appropriate, the securities
proposed to be included by such other persons shall be eliminated from the
offering prior to effecting any reduction in the number of Registrable
Securities to be included by the Creditors' Trust.
(h) (i) Within one hundred twenty (120) days immediately following the
receipt of a request by the Creditors' Trust pursuant to Section 2.1 and prior
to the effective date of any registration statement filed pursuant to this
Section 2.1 or (ii) if the Company shall furnish a certificate signed by the
President of the Company stating that in the good faith judgment of the Board of
Directors of the Company, it would be seriously detrimental to the Company or
its stockholders for such registration statement to be filed on or before the
date filing would be required and it is therefore essential to defer the filing
of such registration statement, then the Company shall have the right to defer
the filing of the registration statement for a period of not more than one
hundred twenty (120) days; provided, however, that the Company may not utilize
such right more than once in any twelve (12) month period.
2.2. Incidental Registration. (a) Right to Include Registrable
Securities. If the Company at any time proposes to register any of its Class A
New Common Stock or any other equity securities of the Company under the
Securities Act (other than by a registration on Form S-8 or Form S-4 or any
successor or similar form, in connection with a merger or acquisition of a
business or assets or similar transaction), whether or not for sale for its own
account, it will each such time give prompt written notice to the Creditors'
Trust of its intention to do so and of the Creditors' Trust's rights under this
Section 2.2. Upon the written request of the Creditors' Trust made within thirty
(30) days after the receipt of any such notice (which request shall specify the
Registrable Securities intended to be disposed of by such holder and the
intended method of disposition thereof), the Company will use reasonable
diligence to effect the registration under the Securities Act of all Registrable
Securities which the Company has been so requested to register, provided that
the number of shares of Registrable Securities of the Creditor's Trust shall not
exceed the number of shares of Class A New Common Stock which the Company then
intends to register; provided, further, that if, at any time after giving
written notice of its intention to register any securities and prior to the
effective date of the registration statement filed in connection with such
registration, the Company shall determine for any reason not to register or to
delay registration of such securities, the Company may, at its election, give
written notice of such determination to the Creditors' Trust and, thereupon, (i)
in the case of a determination not to register, shall be relieved of its
obligation to register any Registrable Securities in connection with such
registration (but not from its obligation to pay the Registration Expenses in
<PAGE>
178
connection therewith), without prejudice, however, to the rights of the
Creditors' Trust to request that such registration be effected as a registration
under Section 2.1, and (ii) in the case of a determination to delay registering,
shall be permitted to delay registering any Registrable Securities, for the same
period as the delay in registering such other securities. No registration
effected under this Section 2.2 shall relieve the Company of its obligation to
effect any registration upon request under Section 2.1. The Company will pay all
Registration Expenses in connection with each registration of Registrable
Securities requested pursuant to this Section 2.2, other than the fees and
expenses of counsel to the Creditors' Trust or the fees and expenses of any
other person retained by the Creditors' Trust and the underwriting discounts and
commissions and transfer taxes allocable to the Registrable Securities being
sold.
(b) Apportionment in Incidental Registrations. If (i) registration
pursuant to this Section 2.2 involves an underwritten offering of the securities
being registered, whether or not for sale for the account of the Company, to be
distributed (on a firm commitment or best efforts basis) by or through one or
more underwriters of recognized standing under underwriting terms appropriate
for such a transaction, and (ii) the managing underwriter of such underwritten
offering shall inform the Company (who shall immediately notify the Creditors'
Trust) of its belief that marketing factors require a delay in the offering or a
limitation of the number of shares to be underwritten below the number of shares
requested to be included in such registration or the number of securities
requested to be included in such registration exceeds the number which can be
sold in (or during the time of) such offering, or within a price range
acceptable to it and the Company, then the Company may include all securities
proposed by the Company to be sold for its own account and may decrease the
number of Registrable Securities and other securities of the Company so proposed
to be sold and so requested to be included in such registration by the
Creditors' Trust to the extent necessary to reduce the number to be included in
the registration to the level recommended by the managing underwriter.
2.3. Registration Procedures. If and whenever the Company is required
to use its best efforts to effect the registration of any Registrable Securities
under the Securities Act as provided in Sections 2.1 and 2.2, the Company will
as expeditiously as possible:
(i) prepare and (as soon thereafter as possible or in any event
no later than ninety (90) days after the end of the period within
which requests for registration may be given to the Company or such
longer period as the Company shall in good faith require to produce
the financial statements required in connection with such
registration) file with the Commission the requisite registration
statement to effect such registration and thereafter use its best
efforts to cause such registration statement to become effective,
provided that the Company may discontinue any registration of its
securities which are not Registrable Securities (and, under the
circumstances specified in Section 2.2(a), its securities which are
Registrable Securities) at any time prior to the effective date of the
registration statement relating thereto;
(ii) prepare and file with the Commission such amendments and
supplements to such registration statement and the prospectus used in
connection therewith as may be necessary to keep such registration
statement effective for at least ninety (90) consecutive days and to
comply with the provisions of the Securities Act with respect to the
disposition of all securities covered by such registration statement
until such time as all of such securities have been disposed of in
accordance with the intended methods of disposition by the seller or
sellers thereof set forth in such registration statement;
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(iii) furnish to the Creditors' Trust to the extent that it is
selling shares covered by such registration statement such number of
conformed copies of such registration statement and of each such
amendment and supplement thereto (in each case including all exhibits,
but only one copy thereof), such number of copies of the prospectus
contained in such registration statement (including each preliminary
prospectus and any summary prospectus) and any other prospectus filed
under Rule 424 under the Securities Act, in conformity with the
requirements of the Securities Act, and such other documents, as such
seller may reasonably request;
(iv) use its best efforts to register or qualify all Registrable
Securities and other securities covered by such registration statement
under such other securities of blue sky laws or such jurisdictions as
the managing underwriter shall request, to keep such registration or
qualification in effect for so long as such registration statement
remains in effect, and take any other action which may be reasonably
necessary or advisable to enable such seller to consummate the
disposition in such jurisdictions of the securities to be sold by such
seller, except that the Company shall not for any such purpose be
required to qualify generally to do business as a foreign corporation
in any jurisdiction wherein it would not but for the requirements of
this subdivision (iv) be obligated to be so qualified or to consent to
general service of process in any such jurisdiction;
(v) use its best efforts to cause all Registrable Securities
covered by such registration statement to be registered with or
approved by such other governmental agencies or authorities as may be
necessary to enable the seller or sellers thereof to consummate the
disposition of such Registrable Securities;
(vi) furnish to the Creditors' Trust to the extent that it is
selling shares, except as provided in (y) below (and the underwriters,
if any);
(x) a signed copy, addressed to each seller of
Registrable Securities, of the opinion of counsel for the
Company delivered to the underwriters or other purchasers
under the underwriting or like agreement, and
(y) a signed copy of any "comfort" letter, dated the
effective date of such registration statement (and, if such
registration includes an underwritten public offering, dated
the date of the closing under the underwriting agreement),
signed by the independent public accountants who have
certified the Company's financial statements included in
such registration statement, addressed to each seller, to
the extent the same can be reasonably obtained, and
addressed to the underwriters, if any, covering
substantially the same matters with respect to such
registration statement (and the prospectus included therein)
and, in the case of the accountants' letter, with respect to
events subsequent to the date of such financial statements,
as are customarily covered in opinions of issuer's counsel
and in accountants' letters delivered to the underwriters in
underwritten public offerings of securities and, in the case
of the accountants' letter, such other financial matters,
and, in the case of the legal opinion, such other legal
matters, as such seller or such holder (or the underwriters,
if any) may reasonably request; provided, however, that in
an underwritten public offering, the sellers of Registrable
Shares shall accept a signed copy of the comfort letter
delivered to and accepted by the underwriters;
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(vii) notify each seller of Registrable Securities covered by
such registration statement, at any time when a prospectus relating
thereto is required to be delivered under the Securities Act, upon
discovery that, or upon the happening of any event as a result of
which, the prospectus included in such registration statement, as then
in effect, includes an untrue statement of a material fact or omits to
state any material fact required to be stated therein or necessary to
make the statements therein not misleading in the light of the
circumstances under which they were made, and at the request of any
such seller or holder promptly prepare and furnish to such seller or
holder a reasonable number of copies of a supplement to or an
amendment of such prospectus as may be necessary so that, as
thereafter delivered to the purchasers of such securities, such
prospectus shall not include an untrue statement of a material fact or
omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading in the light
of the circumstances under which they were made;
(viii) otherwise use its best efforts to comply with all
applicable rules and regulations of the Commission, and make available
to its security holders, as soon as reasonably practicable, an
earnings statement covering the period of at least twelve months, but
not more than eighteen (18) months, beginning with the first full
calendar month after the effective date of such registration
statement, which earnings statement shall satisfy the provisions of
Section 11(a) of the Securities Act, and will furnish to each such
seller at least two business days prior to the filing thereof a copy
of any amendment or supplement to such registration statement or
prospectus and shall not file any thereof to which any such seller
shall have reasonably objected on the grounds that such amendment or
supplement does not comply in all material respects with the
requirements of the Securities Act or of the rules or regulations
thereunder;
(ix) provide and cause to be maintained a transfer agent and
registrar for all Registrable Securities covered by such registration
statement from and after a date not later than the effective date of
such registration statement; and
(x) use its best efforts to list all Registrable Securities
covered by such registration statement on any securities exchange on
which any of the Registrable Securities is then listed.
The Company may require the Creditors' Trust to furnish the Company in writing
such information regarding the Creditors' Trust and the distribution of such
securities as the Company may from time to time reasonably request.
The Creditors' Trust agrees by acquisition of such Registrable
Securities that upon receipt of any notice from the Company of the happening of
any event of the kind described in subdivision (vii) of this Section 2.3, it
will forthwith discontinue disposition of Registrable Securities pursuant to the
registration statement relating to such Registrable Securities until such
holder's receipt of the copies of the supplemented or amended prospectus
contemplated by subdivision (vii) of this Section 2.3 and, if so directed by the
Company, will deliver to the Company (at the Company's expense) all copies,
other than permanent file copies, then in its possession of the prospectus
relating to such Registrable Securities current at the time of receipt of such
notice.
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2.4. Underwritten Offerings. (a) Requested Underwritten Offerings. If
requested by the underwriters for any offering pursuant to a registration
requested under Section 2.1, the Company will enter into an underwriting
agreement with such underwriters for such offering, such agreement to be
satisfactory in substance and form to the Company and to the Creditors' Trust
and the underwriters and to contain such representations and warranties by the
Company and the Creditors' Trust and such other terms as are generally
prevailing in agreements of this type, including, without limitation,
indemnities to the effect and to the extent provided in Section 2.6. The
Creditors' Trust will cooperate with the Company in the negotiation of the
underwriting agreement and will give consideration to the reasonable requests of
the Company regarding the form thereof, provided that nothing herein contained
shall diminish the foregoing obligations of the Company.
(b) Incidental Underwritten Offerings. If the Company at any time
proposes to register any of its securities under the Securities Act as
contemplated by Section 2.2 and such securities are to be distributed by or
through one or more underwriters, the Company will, if requested by the
Creditors' Trust as provided in Section 2.2 and subject to the provisions of
Section 2.2(b), arrange for such underwriters to include all the Registrable
Securities to be offered and sold by the Creditors' Trust among the securities
to be distributed by such underwriters.
(c) In connection with any underwritten offering described in either
Section 2.4(a) or (b) hereof, the holders of Registrable Securities to be
distributed by such underwriters shall be parties to the underwriting agreement
between the Company and such underwriters and may, at their option, require that
any or all of the representations and warranties by, and the other agreements on
the part of, the Company to and for the benefit of such underwriters shall also
be made to and for the benefit of such holders of Registrable Securities and
that any or all of the conditions precedent to the obligations of such
underwriters under such underwriting agreement be conditions precedent to the
obligations of such holders of Registrable Securities. Any such holder of
Registrable Securities shall not be required to make any representations or
warranties to or agreements with the Company or the underwriters other than
representations, warranties or agreements regarding such holder, such holder's
Registrable Securities and such holder's intended method of distribution and any
other representation required by law.
2.5. Preparation; Reasonable Investigation. In connection with the
preparation and filing of each registration statement under the Securities Act
pursuant to this Agreement, the Company will give the Creditors' Trust and its
counsel the opportunity to participate in the preparation of such registration
statement, each prospectus included therein or filed with the Commission, and
each amendment thereof or supplement thereto, and will give each of them such
access to its books and records and such opportunities to discuss the business
of the Company with its officers and the independent public accountants who have
certified its financial statements as shall be necessary, in the opinion of such
holders' and such underwriters' respective counsel, to conduct a reasonable
investigation within the meaning of the Securities Act.
2.6. Indemnification. (a) Indemnification by the Company. In the event
of any registration of any securities of the Company under the Securities Act,
the Company will, and hereby does, indemnify and hold harmless the Creditors'
Trust, its trustees, employees and agents, each other Person who participates as
an underwriter in the offering or sale of such securities and such other Person,
if any, who controls such seller or any such underwriter within the meaning of
the Securities Act, against any losses, claims, damages or liabilities, joint or
several, to which such seller or any such trustee, employee, agent, underwriter
or controlling person may become subject under the Securities Act or otherwise,
insofar as such losses, claims, damages or liabilities (or actions or
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182
proceedings, whether commenced or threatened, in respect thereof) arise out of
or are based upon any untrue statement or alleged untrue statement of any
material fact contained in any registration statement under which such
securities were registered under the Securities Act, any preliminary prospectus,
final prospectus or summary prospectus contained therein, or any amendment or
supplement thereto, or any omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, and the Company will reimburse such seller and each such
trustee, employee, agent, underwriter and controlling person for any legal or
any other expenses reasonably incurred by them in connection with investigating
or defending any such loss, claim, liability, action or proceeding; provided
that the Company shall not be liable in any such case to the extent that any
such loss, claim, damage, liability (or action or proceeding in respect thereof)
or expense arises out of or is based upon an untrue statement or alleged untrue
statement or omission or alleged omission made in such registration statement,
any such preliminary prospectus, final prospectus, summary prospectus, amendment
or supplement in reliance upon and in conformity with written information
furnished to the Company in writing by or on behalf of a seller for use in the
preparation thereof and, provided further that the Company shall not be liable
to any Person who participates as an underwriter, in the offering or sale of
Registrable Securities or any other Person, if any, who controls such
underwriters within the meaning of the Securities Act, in any such case to the
extent that any such loss, claim, damage, liability (or action or proceeding in
respect thereof) or expense arises out of such Person's failure to send or give
a copy of the final prospectus, as the same may be then supplemented or amended,
to the Person asserting an untrue or alleged untrue statement or omission or
alleged omission at or prior to the written confirmation of the sale of
Registrable Securities to such Person if such statement or omission was
corrected in such final prospectus. Such indemnity shall remain in full force
and effect regardless of any investigation made by on or behalf of such seller
or any such trustee, employee, agent, underwriter or controlling person and
shall survive the transfer of such securities by such seller.
(b) Indemnification by Creditors' Trust. The Company may require, as a
condition to including any Registrable Securities in any registration statement
filed pursuant to Section 2.3, that the Company shall have received an
undertaking satisfactory to it from the prospective seller of such securities,
to indemnify and hold harmless (in the same manner and to the same extent as set
forth in subdivision (a) of this Section 2.6) the Company, each director of the
Company, each officer of the Company and each other Person, if any, who controls
the Company within the meaning of the Securities Act, with respect to any
statement or alleged statement in or omission or alleged omission from such
registration statement, any preliminary prospectus, final prospectus or summary
prospectus contained therein, or any amendment or supplement thereto, if such
statement or alleged statement or omission or alleged omission was made in
reliance upon and in conformity with written information furnished to the
Company in writing by or on behalf of the Creditors' Trust, specifically for use
in the preparation of such registration statement, preliminary prospectus, final
prospectus, summary prospectus, amendment or supplement. Such indemnity shall
remain in full force and effect, regardless of any investigation made by or on
behalf of the Company or any such director, officer or controlling Person and
shall survive the transfer of such securities by such seller.
(c) Notices of Claims, etc. Promptly after receipt by an indemnified
party of notice of the commencement of any action or proceeding involving a
claim referred to in the preceding subdivisions of this Section 2.6, such
indemnified party will, if a claim in respect thereof is to be made against an
indemnifying party, give written notice to the latter of the commencement of
such action, provided that the failure of any indemnified party to give notice
as provided herein shall not relieve the indemnifying party of its obligations
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183
under the preceding subdivisions of this Section 2.6, except to the extent that
the indemnifying party is actually prejudiced by such failure to give notice. In
case any such action is brought against an indemnified party, unless in such
indemnified party's reasonable judgment a conflict of interest between such
indemnified party and indemnifying parties may exist in respect of such claim,
the indemnifying party shall be entitled to participate in and to assume the
defense thereof, jointly with any other indemnifying party similarly notified to
the extent that it may wish, with counsel reasonably satisfactory to such
indemnified party, and after notice from the indemnifying party to such
indemnified party of its election so to assume the defense thereof, the
indemnifying party shall not be liable to such indemnified party for any legal
or other expenses subsequently incurred by the latter in connection with the
defense thereof other than reasonable costs of investigation; provided, however,
that all indemnified parties with respect to a claim shall have the right to
employ one separate counsel in connection with their participation in the
defense of such claim and the fees and expenses of such counsel shall be paid by
the indemnifying party if, but only if, in the reasonable judgment of such
indemnified parties, based upon the written advice of counsel, a conflict of
interest exists between such indemnified parties and the indemnifying party with
respect to such claim. No indemnifying party shall, without the consent of the
indemnified party, consent to entry of any judgment or enter into any settlement
which does not include as an unconditional term thereof the giving by the
claimant or plaintiff to such indemnified party of a release from all liability
in respect to such claim or litigation.
(d) Other Indemnification. Indemnification and/or contribution similar
to that specified in the subdivisions of this Section 2.6 (with appropriate
modifications) shall be given by the Company and the Creditors' Trust with
respect to any required registration or other qualification of securities under
any Federal or state law or regulation of any governmental authority other than
the Securities Act.
(e) Indemnification Payments. The indemnification and/or contribution
required by this Section 2.6 shall be made by periodic payments of the amount
thereof during the course of the investigation or defense, as and when bills are
received or expense, loss, damage or liability is incurred.
(f) Lock-up. The underwriter for any offering of the Company's
securities to the general public shall have the option to restrict the sale of
any of the Company's Common Stock, or Securities exchangeable therefor, by the
Company (except for securities subject to a registration on Form S-8) other than
securities registered in such offering, for a period of up to 120 days from the
effective date of any such offering.
(g) Contribution. If the indemnification provided for in this Section
2.6 shall for any reason be held by a court to be unavailable to an indemnified
party under subparagraph (a) or (b) hereof in respect of any loss, claim, damage
or liability, or any action in respect thereof, then, in lieu of the amount paid
or payable under subparagraph (a) or (b) hereof, the indemnified party and the
indemnifying party under subparagraph (a) or (b) hereof shall contribute to the
aggregate losses, claims, damages and liabilities (including legal or other
expenses reasonably incurred in connection with investigating the same), (i) in
such proportion as is appropriate to reflect the relative fault of the Company
and the prospective sellers of Registrable Securities covered by the
registration statement which resulted in such loss, claim, damage or liability,
or action in respect thereof, with respect to the statements or omissions which
resulted in such loss, claim, damage or liability, or action in respect thereof,
as well as any other relevant equitable considerations or (ii) if the allocation
provided by clause (i) above is not permitted by applicable law, in such
proportion as shall be appropriate to reflect the relative benefits received by
the Company and such prospective sellers from the offering of the securities
covered by such registration statement. No Person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any Person who was not guilty of such
fraudulent misrepresentation. Such prospective sellers' obligations to
contribute as provided in this subparagraph (d) are several in proportion to the
relative value of their respective Registrable Securities covered by such
registration statement and not joint. In addition, no Person shall be obligated
to contribute hereunder any amounts in payment for any settlement of any action
or claim effected without such Person's consent, which consent shall not be
unreasonably withheld.
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3. Definitions. As used herein, unless the context otherwise requires,
the following terms have the following respective meanings:
Commission: The Securities and Exchange Commission or any other Federal
agency at the time administering the Securities Act.
Class A New Common Stock: Class A New Common Stock, $.01 par value per
share, of the Company.
Class B New Common Stock: Class B New Common Stock, $.01 par value per
share, of the Company.
Company: Reinhold Industries, Inc., a Delaware corporation.
Exchange Act: The Securities Exchange Act of 1934, as amended.
Person: A corporation, an association, a partnership, a business, an
individual, a governmental or political subdivision thereof or a governmental
agency.
Registrable Securities: Any shares of Class B New Common Stock owned by
the Creditors' Trust, which shall be converted into Class A New Common Stock
upon registration or any shares of Class A New Common Stock owned by a
Transferee, provided that the Creditors' Trust expressly assigned its rights
under this Registration Agreement to such Transferee, but in no event shall the
Registrable Securities subject to this Agreement in the hands of such Transferee
exceed the number of shares of Class B New Common Stock assigned or transferred
by the Creditors' Trust to such Transferee (which shares were converted into
Class A New Common Stock upon such assignment or transfer). Registrable
Securities shall cease to be Registrable Securities when (a) a registration
statement with respect to the sale of such securities shall have become
effective under the Securities Act and such securities shall have been disposed
of in accordance with such registration statement, (b) they shall have been
distributed to the public pursuant to Rule 144 (or any successor provision)
under the Securities Act, (c) they shall have been otherwise transferred, new
certificates for them not bearing a legend restricting further transfer shall
have been delivered by the Company or (d) they shall have ceased to be
outstanding.
Registration Expenses: All expenses incident to the Company's
performance of or compliance with Section 2, including, without limitation, all
registration, filing and National Association of Securities Dealers, Inc. fees,
all fees and expenses of complying with securities or blue sky laws, all word
processing, duplicating and printing expenses, messenger and delivery expenses,
the fees and disbursements of counsel for the Company and of independent public
accountants, including the expenses of any special audits or "cold comfort"
letters required by or incident to such performance and compliance, the fees and
disbursements of one counsel retained by the Creditors' Trust provided, however,
that Registration Expenses shall not include underwriting, discounts and
commissions and transfer taxes, if any.
Securities Act: The Securities Act of 1933, as amended.
Transferee: Any Person to which the Creditors' Trust has conveyed,
assigned or transferred at least 200,000 shares of Common Stock.
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4. Rule 144. If the Company shall have filed a registration statement
pursuant to the requirements of Section 12 of the Exchange Act or a registration
statement pursuant to the requirements of the Securities Act, the Company will
file the reports required to be filed by it under the Securities Act and the
Exchange Act (or, if the Company is not required to file such reports, will,
upon the request of any holder of Registrable Securities, use its best efforts
to make publicly available other information) and will use its best efforts to
take such further action as any holder of Registrable Securities may reasonably
request, all to the extent required from time to time to enable such holder to
sell Registrable Securities without registration under the Securities Act within
the limitation of the exemptions provided by (a) Rule 144 under the Securities
Act, as such Rule may be amended from time to time or (b) any similar rule or
regulation hereafter adopted by the Commission. Upon the request of any holder
of Registrable Securities, the Company will deliver to such holder a written
statement as to whether it has complied with such requirements.
5. Term. This Agreement and the rights of the parties hereunder shall
commence on the Effective Date and shall terminate on the tenth anniversary
following such Effective Date.
6. Amendments and Waivers. This Agreement may be amended and the
Company may take any action herein prohibited or to perform any act herein
required to be performed by it, only if the Company shall have obtained the
written consent to such amendment, action or omission to act, of the Creditors'
Trust.
7. Notices. All communications provided for hereunder shall be sent by
first-class mail and (a) if addressed to the Creditors' Trust, c/o Hughes,
Hubbard & Reed, One Battery Park Plaza, New York, 10004-1482, attention: George
A. Davidson, Esq., or (b) if addressed to the Company, 1287 East Imperial
Highway, Santa Fe Springs, California 90670, attention: President.
8. Assignment. This Agreement shall be binding upon and inure to the
benefit of and be enforceable by the parties hereto and their respective
successors and assigns.
9. Descriptive Headings. The descriptive headings of the several
sections and paragraphs of this Agreement are inserted for reference only and
shall not limit or otherwise affect the meaning hereof.
10. GOVERNING LAW. THIS AGREEMENT SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH, AND THE RIGHTS OF THE PARTIES SHALL BE GOVERNED BY, THE LAWS OF
THE STATE OF NEW YORK.
11. Counterpart. This Agreement may be executed simultaneously in any
number of counterparts, each of which shall be deemed an original, but all such
counterparts shall together constitute one and the same instrument.
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IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed and delivered by their respective officers thereunto duly authorized as
of the date first above written.
REINHOLD INDUSTRIES, INC.
By: /s/ Michael T. Furry
---------------------------------------------
Authorized Officer
CREDITORS' TRUST
By: /s/ Richard A. Lippe
---------------------------------------------
Managing Trustee
187
AMENDED AND RESTATED
CERTIFICATE OF INCORPORATION OF
KEENE CORPORATION
Incorporated on April 12, 1990
The Certificate of Incorporation of Keene Corporation, filed with the
Secretary of State of the State of Delaware on April 12, 1990, is being amended
and restated hereby.
ARTICLE I
The name of the corporation (the "Corporation") is: Reinhold
Industries, Inc.
ARTICLE II
The address of its registered office in the State of Delaware is 1209
Orange Street in the City of Wilmington, County of New Castle. The name of its
registered agent at such address is The Corporation Trust Company.
ARTICLE III
The nature of the business or purposes to be conducted or promoted by
the Corporation is to engage in any lawful act or activity for which
corporations may be organized under the General Corporation Law of the State of
Delaware (the "DGCL").
ARTICLE IV
The authorized amount of the capital stock of the Corporation and the
number and par value of the shares of which it is to consist are two million
five hundred thousand (2,500,000) shares, consisting of one million four hundred
eighty thousand (1,480,000) shares of Class A New Common Stock, par $.01 per
share ("Class A New Common Stock"), and one million twenty thousand (1,020,000)
shares of Class B New Common Stock, par value $.01 per share; provided, however,
that upon the conversion of Class B New Common Stock into Class A New Common
Stock, pursuant to this Article IV(8), the number of authorized shares of Class
A New Common Stock shall automatically be increased by the number shares of
Class B New Common Stock so converted and the number of authorized shares of
Class B New Common Stock shall be decreased by the number of shares so
converted, but in no event shall the authorized number of shares of Class A New
Common Stock exceed two million five hundred thousand (2,500,000). (Class A New
Common Stock and Class B New Common Stock are hereinafter collectively referred
to as the "Common Stock"). No shares of capital stock of the Corporation of any
class shall be issued without voting power as hereinafter provided. Except as
otherwise set forth in this Certificate of Incorporation, Class A New Common
Stock and Class B New Common Stock shall be identical and shall entitle the
holder thereof to the same rights and privileges.
The designations, preferences, privileges and voting powers of each
class of stock of the Corporation, and the restrictions or qualifications
thereof, or manner of determining the same, shall be as follows:
1. Except as provided herein, the holders of the Common Stock
shall have and possess all rights appertaining to full voting and
participating common stock of a corporation organized under the
Delaware General Corporation Law.
2. The affirmative vote of the holders of a majority of the
outstanding shares of Common Stock shall be required to authorize the
following: (i) any amendment to the Certificate of Incorporation of
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188
the Corporation; provided, however, that in no event shall any
amendment be adopted which would adversely affect the voting rights of
either the holders of Class A New Common Stock or the holders of Class
B New Common Stock, as the case may be, without the consent of the
holders of a majority of the outstanding shares of the class whose
rights will be adversely affected thereby; (ii) any amendment to the
By-laws of the Corporation upon which holders of Common Stock are
entitled to vote; provided, however, that, except as otherwise
provided in Article VI hereof, any amendment of Article II or Article
III of the By-laws shall require the affirmative vote of the holders
of a majority of the outstanding shares of each of the Class A New
Common Stock and the Class B New Common Stock; (iii) any merger or
consolidation of the Corporation with another corporation or entity
upon which holders of Common Stock are entitled to vote; and (iv) any
sale of assets or plan of dissolution of the Corporation upon which
holders of Common Stock are entitled to vote.
3. (a) The holders of the Class A New Common Stock, voting as a
class, shall elect one director of the Corporation until such time as
the number of shares of Class B New Common Stock represents less than
twenty-five (25%) percent of the aggregate number of shares of Common
Stock then outstanding, in which event the holders of the Class A New
Common Stock, voting as a class, shall elect two directors of the
Corporation; provided, however, that at such time as all of the
remaining shares of Class B New Common Stock shall have been converted
to Class A New Common Stock as set forth in Article IV(5)(b), the
holders of Class A New Common Stock, voting as a class, shall elect
all of the directors of the Corporation.
(b) Each director elected by the holders of Class A New
Common Stock shall be elected by a plurality of the shares of the
Class A New Common Stock voting at such time.
4. (a) The holders of the Class B New Common Stock, voting as a
class, shall elect two directors of the Corporation until such time as
the number of shares of Class B New Common Stock represents less than
twenty-five (25%) percent of the aggregate number of shares of Common
Stock then outstanding, in which event the holders of the Class B New
Common Stock, voting as a class, shall elect one director.
(b) Each director elected by the holders of Class B New
Common Stock shall be elected by a majority of the shares of Class B
New Common Stock voting at such time.
5. Shares of Class B New Common Stock shall automatically be
converted into shares of Class A New Common Stock as follows:
(a) If the Creditors' Trust, as established pursuant to
Section 9.1 of the Debtor's Fourth Amended Plan of Reorganization (the
"Plan") of Keene Corporation (Case No. 93 B 46090 (SMB), United States
Bankruptcy Court, Southern District of New York), shall assign,
transfer or dispose of any shares of Class B New Common Stock (other
than to an entity in which the Creditors' Trust owns all of the
beneficial interests or in connection with the pledge or hypothecation
of such Class B New Common Stock to secure bona fide indebtedness
which is not convertible into Class B New Common Stock), each such
share so assigned, transferred or disposed of shall be converted into
one share of Class A New Common Stock;
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189
(b) Upon the earlier to occur of (A) the date upon which the
number of shares of Class B New Common Stock shall represent less than
ten (10%) percent of the aggregate shares of Common Stock then
outstanding, and (B) the date occurring ten years from the Effective
Date (as such term is defined in the Plan), all of the then remaining
shares of Class B New Common Stock shall be converted into Class A New
Common Stock;
(c) Upon conversion of shares of Class B New Common Stock
into shares of Class A New Common Stock, the holder of Class B New
Common Stock shall surrender the certificate representing such Class B
New Common Stock to the Corporation, which will issue new certificates
reflecting such conversion.
6. No holder of shares of Common Stock shall be entitled, as a
matter of right, to subscribe for or purchase any part of any new or
additional issue of stock of any class whatsoever of the Corporation,
or of securities convertible into stock of any class whatsoever,
whether now or hereafter authorized or whether issued for cash or
other consideration or by way of dividend.
7. Each holder of Common Stock shall be entitled to one vote for
each share held by such holder.
8. (a) Except as otherwise provided herein, for a period of
twenty-five (25) months from the Effective Date, (A) no holder
("Transferor") of shares of Common Stock shall transfer, convey,
assign, pledge or otherwise dispose (including without limitation
distributions from the Creditors Trust, to any beneficiary thereof) of
all, or any interest in, the shares of Common Stock of such holder, or
grant an option or contractual right ("Rights") to acquire ownership
of such shares (whether or not currently exercisable) (collectively, a
"Transfer") to any person or entity or group of persons or entities
acting in concert ("Transferee") and no Transferee shall acquire
ownership of such shares or Rights if, immediately following such
Transfer, such Transferee owns or thereby acquires ownership of more
than four and three-quarters (4.75%) percent of issued and outstanding
shares of Common Stock (a Transferee who has or acquires more than the
allowed ownership percentage is hereinafter referred to as a
"Prohibited Transferee") and (B) no Transfer shall be made by a person
or entity or a group of persons or entities acting in concert
("Prohibited Transferor") who own five (5%) percent or more of the
issued and outstanding Shares of Common Stock. (Any Transfer
prohibited by this Article IV(8) is hereinafter referred to as a
"Prohibited Transfer"). For these purposes, a Transferee's ownership
percentage of the Common Stock shall be determined under Section 382
of the Internal Revenue Code of 1986, as amended, and the Treasury
Regulations promulgated thereunder which are applicable on the date of
such actual or purported transfer and shall include direct ownership
and adjustments for indirect ownership as required under such statute
and regulations.
(b) Within thirty (30) days of obtaining actual knowledge of
any Transfer, the Corporation may demand in writing that the
Transferor making a Transfer of, or the Transferee acquiring, such
Common Stock provide a certificate ("Certificate") to the Corporation
within ten (10) days of receipt of such notice, which Certificate sets
forth the aggregate number of shares of Common Stock owned, in title
or beneficially, by the Transferor or the Transferee both preceding
and following such Transfer and such other information (including, but
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not limited to, direct or indirect interests in other entities owning
shares of Common Stock, family relationships with persons owning
shares of Common Stock or direct or indirect interests in entities
owning such shares, and options or contractual rights to purchase
shares of Common Stock) as the Corporation shall reasonably deem
necessary to determine the Transferor's and the Transferee's
percentage ownership of Common Stock for purposes of this Article
IV(8).
(c) If, upon review of the Certificate and other available
facts, the Corporation determines that the Transferee is, or by reason
of the transfer has become, a Prohibited Transferee, or that the
Transferor is a Prohibited Transferor, the Corporation shall declare
the transfer to be a Prohibited Transfer under this Article IV(8), and
the acquisition of the shares or Rights by the Prohibited Transferee
or the Transfer of the shares or Rights by a Prohibited Transferor, as
the case may be, shall be deemed null and void ab initio, the transfer
agent for the Corporation shall treat the shares subject to the
Prohibited Transfer (including any shares subject to Rights) as having
never been transferred to, or acquired by, the Prohibited Transferee,
or the Transferee of a Prohibited Transferor, and the Corporation's
books and records shall reflect that no Transfer of such shares has
occurred, unless the Board of Directors of the Corporation by
unanimous consent shall waive, in writing, the provisions of this
Article IV(8) with respect to such transfer.
(d) In the event of a Prohibited Transfer, any purported
Transferee shall not be entitled to any rights as a shareholder of the
Corporation, including, but not limited to, the right to vote shares
subject to a Prohibited Transfer, and the right to receive any
dividend distributions, including liquidating distributions on account
thereon, and the purported Transferee shall, upon written demand by
the Corporation, return any and all distributions which such
Transferee shall have received from the Corporation with respect to
any shares of Common Stock subject to a Prohibited Transfer.
(e) Each certificate evidencing Common Stock shall bear the
following restrictive legend:
(A) The front of such certificate shall bear a
conspicuous legend reading as follows:
"THE TRANSFER OF THE SECURITIES REPRESENTED HEREBY
IS SUBJECT TO RESTRICTION PURSUANT TO THE AMENDED
AND RESTATED CERTIFICATE OF INCORPORATION OF
REINHOLD INDUSTRIES, INC., WHICH RESTRICTION IS
SUMMARIZED ON THE BACK OF THIS CERTIFICATE."
(B) The back of such certificate shall bear a
legend reading as follows:
"Transfer of the shares of Common Stock of
the Corporation is restricted in accordance with
Article IV(8) of the Amended and Restated
Certificate of Incorporation of the Corporation,
which prohibits the acquisition of the ownership
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191
of shares, or rights to acquire shares, of Common
Stock by a person or entity or persons or entities
acting in concert which has, or thereby would
have, ownership of more than four and three
quarters (4.75%) percent of the issued and
outstanding shares of Common Stock, as determined
under Section 382 of Internal Revenue Code of
1986, as amended, and the Treasury Regulations
promulgated thereunder (collectively, "Section
382"). The transfer of shares, or rights to
acquire shares, by a person or entity or persons
or entities acting in concert which has ownership
of five (5%) percent of the issued and outstanding
Common Stock of the Corporation, as determined
under Section 382, also is restricted in
accordance with Article IV(8) of the Amended and
Restated Certificate of Incorporation. Any
transfer prohibited by Article IV(8) of the
Amended and Restated Certificate of Incorporation
of the Corporation shall be null and void ab
initio and will not be reflected on the books and
records of the Corporation, unless the
restrictions are waived by the unanimous consent
of the Board of Directors of the Corporation."
ARTICLE V
The Corporation's Board of Directors shall consist of three members who
shall be elected as provided in Article IV.
ARTICLE VI
In furtherance and not in limitation of the powers conferred by
statute, the by-laws of the Corporation may be made, altered, amended or
repealed by a majority vote of the entire board of directors (except with
respect to Article II or Article III of the by-laws, which may be altered,
amended or repealed only by a unanimous vote of the entire board of directors)
or by the vote of the stockholders, approving the alteration, amendment or
repeal, as the case may be, in accordance with the provisions of Article IV(2).
ARTICLE VII
1. The Corporation shall indemnify to the fullest extent permitted
under and in accordance with the laws of the State of Delaware any person who
was or is a party or is threatened to be made a party to any threatened, pending
or completed action, suit or proceeding, whether civil, criminal, administrative
or investigative by reason of the fact that he is or was a director, officer,
employee or agent of the Corporation or, while serving as a director, officer,
employee or agent of the Corporation, is or was serving at the request of the
Corporation, as a director, officer, employee or agent of or in any other
capacity with another corporation, partnership, joint venture, trust or other
enterprise, against expenses (including attorneys' fees), judgments, fines and
amounts paid in settlement actually and reasonably incurred by him in connection
with such action, suit or proceeding if he acted in good faith and in a manner
he reasonably believed to be in or not opposed to the best interests of the
Corporation, and with respect to any criminal action or proceeding, had no
reasonable cause to believe his conduct was unlawful.
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2. Expenses (including attorneys' fees) incurred in defending any
civil, criminal, administrative or investigative action, suit or proceeding
shall (in the case of any action, suit or proceeding against a director of the
Corporation) or may (in the case of any action, suit or proceeding against an
officer, trustee, employee or agent) be paid by the Corporation in advance of
the final disposition of such action, suit or proceeding as authorized by the
Board upon receipt of an undertaking by or on behalf of the indemnified person
to repay such amount if it shall ultimately be determined that he is not
entitled to be indemnified by the Corporation as authorized in this paragraph.
3. The indemnification, advancement of expenses and other rights set
forth in this Paragraph shall not be exclusive of any provisions with respect
thereto in the by-laws or any other contract or agreement between the
Corporation and any officer, director, employee or agent of the Corporation.
4. Neither the amendment nor repeal of this Article VII, subparagraphs
1, 2 or 3, nor the adoption of any provision of this Certificate of
Incorporation inconsistent with Article VII, subparagraphs 1, 2 or 3, shall
eliminate or reduce the effect of this Article VII, subparagraphs 1, 2 and 3, in
respect of any matter occurring before such amendment, repeal or adoption of an
inconsistent provision or in respect of any cause of action, suit or claim
relating to any such matter which would have given rise to a right of
indemnification or right to receive expenses pursuant to this Article VII,
subparagraphs 1, 2 or 3, if such provision had not been so amended or repealed
or if a provision inconsistent therewith had not been so adopted.
5. No director shall be personally liable to the Corporation or any
stockholder for monetary damages for breach of fiduciary duty as a director,
except for any matter in respect of which such director (A) shall be liable
under Section 174 of the DGCL or any amendment thereto or successor provision
thereto, or (B) shall be liable by reason that, in addition to any and all other
requirements for liability, he: (i) shall have breached his duty of loyalty to
the Corporation or its stockholders; (ii) shall not have acted in good faith or,
in failing to act, shall not have acted in good faith; (iii) shall have acted in
a manner involving intentional misconduct or a knowing violation of law or, in
failing to act, shall have acted in a manner involving intentional misconduct or
a knowing violation of law; or (iv) shall have derived an improper personal
benefit.
If the Delaware General Corporation Law is amended after the date of
incorporation of the Corporation to authorize corporation action further
eliminating or limiting the personal liability of directors, then the liability
of a director of the Corporation shall be eliminated or limited to the fullest
extent permitted by the Delaware General Corporation Law, as so amended.
ARTICLE VIII
Keene Corporation filed a petition for relief under Chapter 11 of the
United States Bankruptcy Code on December 3, 1993. Provision for the making of
this Certificate of Incorporation is pursuant to Keene Corporation's Fourth
Amended Plan of Reorganization, as modified, and the confirmation order, dated
June 12, 1996, of the United States District Court for the Southern District of
New York in In re Keene Corporation, Civil Action No. 96 CV 3492 (MBM).
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IN WITNESS WHEREOF, Keene Corporation has caused this Amended and
Restated Certificate of Incorporation to be signed by Timothy E. Coyne, its
President, and attested to by Norman W. Weinstock, its Secretary, this 25th day
of July, 1996.
ATTEST: KEENE CORPORATION
/s/ Norman W. Weinstock By: /s/ Timothy E. Coyne
- ----------------------------- -----------------------------------
Secretary Name: Timothy E. Coyne
Title: President
