As filed with the Securities and Exchange Commission on August 12, 1998
Registration No. 333-51145
===============================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
-----------------------------------
POST-EFFECTIVE AMENDMENT NO. 1
TO FORM S-4
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
-----------------------------------
INSILCO CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 367, 346, 274,359 06-0635844
(State or other (Primary Standard (IRS Employer
jurisdiction of Industrial Identification No.)
incorporation Classification
or organization) Code Number)
-----------------------------------
425 Metro Place North
Fifth Floor
Dublin, Ohio 43017
(614) 792-0468
(Address, including zip code, and telephone number,
including area code, of registrant's principal executive offices)
-----------------------------------
Kenneth H. Koch
Vice President and General Counsel
INSILCO CORPORATION
425 Metro Place North
Fifth Floor
Dublin, Ohio 43017
(614) 791-3137
(Name, address, including zip code,
and telephone number, including
area code, of agent for service)
-----------------------------------
Copies to:
Aviva Diamant John W. Buttrick
Fried, Frank, Harris, Davis Polk & Wardwell
Shriver & Jacobson 450 Lexington Avenue
One New York Plaza New York, NY 10017
New York, NY 10004
-----------------------------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: As
soon as practicable after the effectiveness of this Registration Statement
and the effective time ("Effective Time") of the merger (the "Merger") of
Silkworm Acquisition Corporation ("MergerSub") with and into Insilco
Holding Co. ("ExistingSub"), a wholly owned subsidiary of Insilco
Corporation (the "Company"), as described in the Agreement and Plan of
Merger dated as of March 24, 1998, as amended.
If the securities being registered on this Form are being offered in
connection with the formation of a holding company and there is compliance
with General Instruction G, check the following box. |_|
If this form is filed to register additional securities for an
offering pursuant to Rule 462(b) under the Securities Act, check the
following box and list the Securities Act registration number of the
earlier effective registration statement for the same offering. |_|
If this form is a post-effective amendment filed pursuant to Rule
462(d) under the Securities Act, check the following box and list the
Securities Act registration number of the earlier effective registration
statement for the same offering. |x| 333-51145
-----------------------------------
<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
===================================================================================================
Proposed Maximum Proposed Maximum
Title of each Class of Amount to be Offering Price Aggregate Amount of
Securities Registered(1)(2) Per Share Offering Price(2) Registration
to be Registered Fee(2)
- - --------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, par value 140,031 N/A $0 $0
$0.001 per share
- - --------------------------------------------------------------------------------------------------
(1) This Registration Statement relates to shares of common stock, par
value $0.001 per share, which are the shares into which the shares of
common stock, par value $0.001 per share, of the Company (the
"Shares") will be converted in a reorganization merger pursuant to
Section 251(a) of the Delaware General Corporation Law (the
"Reorganization Merger") (pursuant to which the Company will become a
wholly owned subsidiary of ExistingSub) and which are to be retained
by the holders thereof as a result of the Merger, which will take
place promptly following the Reorganization Merger.
(2) Pursuant to Rule 457(f) under the Securities Act of 1933, as amended,
and solely for purposes of calculating the registration fee, the
registration fee was computed on the basis of the last reported sale
on the NASDAQ National Market on the relevant date, less the amount of
cash to be paid by the Company in connection with the Merger.
</TABLE>
EXPLANATORY NOTE
This Post-Effective Amendment No. 1 to the Registration Statement on
Form S-4 (the "Registration Statement") filed by Insilco Corporation
(Registration No. 333-51145) is being filed in order to add as an exhibit
to the Registration Statement Amendment No. 2 to the Agreement and Plan of
Merger, dated August 12, 1998, among the Company, INR Holding Co. and
Silkworm Acquisition Corporation. The Merger Agreement is being amended to
add a class of preferred stock to the certificate of incorporation of the
corporation surviving the Merger (as defined in the Registration
Statement). The preferred stock will be a component of the financing used
to complete the Merger.
Item 21. Exhibits and Financial Statement Schedules.
(a) Exhibits
EXHIBIT INDEX
10(s)- Amendment No. 2 to the Agreement and Plan of Merger, dated August
12, 1998, among the Company, INR Holding Co. and Silkworm
Acquisition Corporation (filed herewith).
SIGNATURES
Pursuant to the requirements of the Securities Act, the Registrant has
duly caused this registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in New York, New York on the 12th
day of August, 1998.
INSILCO CORPORATION
By: /s/ Kenneth H. Koch
--------------------------------
Name: Kenneth H. Koch
Title: Vice President & General
Counsel
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the date first above written:
Signature Title Date
- - ------------------------ ------------------------------------ ---------------
*
- - ------------------------
Robert L. Smialek Chairman of the Board, President August 12, 1998
and Chief Executive Officer
*
- - ------------------------
David A. Kauer Vice President and Chief Financial August 12, 1998
Officer
*
- - ------------------------
James J. Gaffney Director August 12, 1998
*
- - ------------------------
Terence M. O'Toole Director August 12, 1998
*
- - ------------------------
Thomas E. Petry Director August 12, 1998
*
- - ------------------------
Barry S. Volpert Director August 12, 1998
*By: /s/ Kenneth H. Koch
- - ------------------------
Kenneth H. Koch
Attorney-in-Fact
EXHIBIT 10(s)
AMENDMENT NO. 2
TO AGREEMENT AND PLAN OF MERGER
AMENDMENT dated as of August 12, 1998 among INSILCO CORPORATION,
a Delaware corporation ("Insilco" or the "Company"), INSILCO HOLDING CO., a
Delaware corporation (formerly known as INR Holding Co.) ("ExistingSub")
and SILKWORM ACQUISITION CORPORATION, a Delaware corporation ("MergerSub").
WHEREAS, the Company, ExistingSub and MergerSub have previously
entered into an Agreement and Plan of Merger (as amended to date and
hereby, the "Merger Agreement") dated as of March 24, 1998, providing for
the merger of MergerSub with and into ExistingSub; and
WHEREAS, the Company, ExistingSub and MergerSub desire to amend
the Merger Agreement as set forth herein.
NOW, THEREFORE, the parties hereto agree as follows:
SECTION 1. References. Unless otherwise specifically defined
herein, each term used herein which is defined in the Merger Agreement has
the meaning assigned to such term in the Merger Agreement. Each reference
to "hereof", "hereunder", "herein" and "hereby" and each other similar
reference and each reference to "this Agreement" and each other similar
reference contained in the Merger Agreement shall from and after the
effective date of this Amendment refer to the Merger Agreement as amended
hereby, except in any instance in the Merger Agreement where any such
reference relates to the date of the execution of the Merger Agreement in
which instance such reference shall relate to the Merger Agreement, as
unamended hereby.
SECTION 2. Amendments. The Merger Agreement is hereby amended as
follows:
(A) Article FOURTH to the proposed certificate of incorporation
of ExistingSub as set forth in Exhibit A to the Merger Agreement shall be
deleted in its enirety, and replaced with the following:
"FOURTH: The total number of shares of stock which the
Corporation shall have authority to issue is 18,000,000
consisting of 15,000,000 shares of Common Stock, par value $0.001
per share (the "Common Stock") and 3,000,000 shares of Preferred
Stock, par value $0.001 per share (the "Preferred Stock"). The
Board of Directors is hereby empowered to authorize by resolution
or resolutions from time to time the issuance of one or more
classes or series of Preferred Stock and fix the designations,
powers, preferences and relative, participating, optional or
other rights, if any, and the qualifications, limitations or
restrictions thereof, if any, with respect to each such class or
series of Preferred Stock and the number of shares constituting
each such class or series, and to increase or decrease the number
of shares of any such class or series to the extent permitted by
Delaware Law."
(B) The Certificate of Designations, Preferences and Rights of
the 15% Senior Exchangeable Preferred Stock Due 2010 as set forth in
Exhibit 1 to this Amendment shall be appended to Exhibit A to the Merger
Agreement.
SECTION 3. Counterparts; Effectiveness. This Amendment may be
signed in any number of counterparts, each of which shall be an original,
with the same effect as if the signatures thereto and hereto were upon the
same instrument. This Amendment shall become effective when each party
hereto shall have received counterparts hereof signed by all of the other
parties hereto.
IN WITNESS WHEREOF, the parties hereto have duly executed this
Amendment or have caused this Amendment to be duly executed by their
respective authorized officers as of the day and year first above written.
INSILCO CORPORATION
By: /s/ Kenneth H. Koch
------------------------------
Name: Kenneth H. Koch
Title: Vice President and
General Counsel
INSILCO HOLDING CO.
By: /s/ Kenneth H. Koch
------------------------------
Name: Kenneth H. Koch
Title: Vice President and
General Counsel
SILKWORM ACQUISITION
CORPORATION
By: /s/ William F. Dawson, Jr.
------------------------------
Name: William F. Dawson, Jr.
Title: Secretary
EXHIBIT 1
CERTIFICATE OF DESIGNATIONS, PREFERENCES
AND RIGHTS OF 15% SENIOR EXCHANGEABLE
PREFERRED STOCK DUE 2010
of
INSILCO HOLDING CO.
Pursuant to Section 151 of the General Corporation Law
of the State of Delaware
We, the undersigned, , President and , Secretary, of Insilco Holding
Co., a Delaware corporation (hereinafter called the "Corporation"),
pursuant to the provisions of Sections 103 and 151 of the General
Corporation Law of the State of Delaware, do hereby make this Certificate
of Designations and do hereby state and certify that pursuant to the
authority expressly vested in the Board of Directors of the Corporation by
the Certificate of Incorporation, the Board of Directors duly adopted the
following resolution:
RESOLVED, that, pursuant to Article Fourth of the Certificate of
Incorporation (which authorizes 3,000,000 shares of preferred stock, $0.001
par value ("Preferred Stock"), of which no shares of Preferred Stock are
currently issued and outstanding), the Board of Directors hereby fixes the
powers, designations, preferences and relative, participating, optional and
other special rights, and the qualifications, limitations and restrictions,
of a series of Preferred Stock.
RESOLVED, that each share of such series of Preferred Stock shall rank
equally in all respects and shall be subject to the following provisions:
(1) Number And Designation. 3,000,000 shares of the Preferred Stock of
the Corporation shall be designated as 15% Senior Exchangeable Preferred
Stock Due 2010 (the "Senior Preferred Stock").
(2) Rank. The Senior Preferred Stock shall, with respect to dividend
rights and rights on liquidation, dissolution and winding up, rank prior to
all classes of or series of common stock of the Corporation, including the
Corporation's common stock, par value $0.001 per share ("Common Stock"),
and each other class of capital stock of the Corporation, the terms of
which provide that such class shall rank junior to the Senior Preferred
Stock or the terms of which do not specify any rank relative to the Senior
Preferred Stock. All equity securities of the Corporation to which the
Senior Preferred Stock ranks prior (whether with respect to dividends or
upon liquidation, dissolution, winding up or otherwise), including the
Common Stock, are collectively referred to herein as the "Junior
Securities." All equity securities of the Corporation with which the Senior
Preferred Stock ranks on a parity (whether with respect to dividends or
upon liquidation, dissolution or winding up) are collectively referred to
herein as the "Parity Securities." The respective definitions of Junior
Securities and Parity Securities shall also include any rights or options
exercisable for or convertible into any of the Junior Securities and Parity
Securities, as the case may be. The Senior Preferred Stock shall be subject
to the creation of Junior Securities.
(3) Dividends. (a) (i) The holders of shares of Senior Preferred Stock
shall be entitled to receive, when, as and if declared by the Board of
Directors, out of funds legally available for the payment of dividends,
dividends (subject to Sections 3(a)(ii) and (iii) hereof) at a rate equal
to 15% per annum (on the basis of a 360 day year) (the "Dividend Rate") on
the Liquidation Value of each share of Senior Preferred Stock on and as of
the most recent Dividend Payment Date (as defined below). In the event the
Corporation is unable or shall fail to discharge its obligation to redeem
all outstanding shares of Senior Preferred Stock pursuant to paragraph 5(b)
or 5(c) hereof, the Dividend Rate shall increase by .25 percent per quarter
(each, a "Default Dividend") for each quarter or portion thereof following
the date on which such redemption was required to be made until cured,
provided that the aggregate increase shall not exceed 5%. Such dividends
shall be payable in the manner set forth below in Sections 3(a)(ii) and
(iii) quarterly on January 31, April 30, July 31, and October 31 of each
year (unless such day is not a business day, in which event on the next
succeeding business day) (each of such dates being a "Dividend Payment
Date" and each such quarterly period being a "Dividend Period"). Such
dividends shall be cumulative from the date of issue, whether or not in any
Dividend Period or Periods there shall be funds of the Corporation legally
available for the payment of such dividends.
(ii) Prior to August 1, 2003 (the "Cash Pay Date"), dividends
shall not be payable in cash to holders of shares of Senior
Preferred Stock but shall, subject to Section 3(b) hereof,
accrete to the Liquidation Value in accordance with Section 4(a)
hereof.
(iii) Following the Cash Pay Date, each such dividend shall be
payable in cash on the Liquidation Value per share of the Senior
Preferred Stock, in equal quarterly amounts (to which the Default
Dividend, if any, shall be added), to the holders of record of
shares of the Senior Preferred Stock, as they appear on the stock
records of the Corporation at the close of business on such
record dates, not more than 60 days or less than 10 days
preceding the payment dates thereof, as shall be fixed by the
Board of Directors. Accrued and unpaid dividends for any past
Dividend Periods may be declared and paid at any time, without
reference to any Dividend Payment Date, to holders of record on
such date, not more than 45 days preceding the payment date
thereof, as may be fixed by the Board of Directors.
(b) At the written request of the holders of a majority of the shares
of Senior Preferred Stock, the Corporation shall, commencing on the first
Dividend Payment Date after such request and ending on the Cash Pay Date,
be required to pay all dividends on shares of Senior Preferred Stock by the
issuance of additional shares of Senior Preferred Stock ("Additional
Shares"). The Additional Shares shall be identical to all other shares of
Senior Preferred Stock, except as set forth in Section 4. For the purposes
of determining the number of Additional Shares to be issued as dividends
pursuant to this Paragraph (b), such Additional Shares shall be valued at
their Applicable Liquidation Value as provided in Section 4(c).
(c) Holders of shares of Senior Preferred Stock shall not be entitled
to any dividends, whether payable in cash, property or stock, in excess of
the cumulative dividends, as herein provided, on the Senior Preferred
Stock. Except as provided in this Section 3, no interest, or sum of money
in lieu of interest, shall be payable in respect of any dividend payment or
payments on the Senior Preferred Stock that may be in arrears.
(d) So long as any shares of the Senior Preferred Stock are
outstanding, no dividends, except as described in the next succeeding
sentence, shall be declared or paid or set apart for payment on Parity
Securities, for any period unless (to the extent such dividends are payable
in cash) full cumulative dividends have been or contemporaneously are
declared and paid or declared and a sum sufficient for the payment thereof
set apart for such payment on the Senior Preferred Stock for all Dividend
Periods terminating on or prior to the date of payment of the dividend on
such class or series of Parity Securities. When (to the extent such
dividends are payable in cash) dividends are not paid in full or a sum
sufficient for such payment is not set apart, as aforesaid, all dividends
declared upon shares of the Senior Preferred Stock and all dividends
declared upon any other class or series of Parity Securities shall (in each
case, to the extent payable in cash) be declared ratably in proportion to
the respective amounts of dividends accumulated and unpaid on the Senior
Preferred Stock and accumulated and unpaid on such Parity Securities.
(e) So long as any shares of the Senior Preferred Stock are
outstanding, no dividends (other than dividends or distributions paid in
shares of, or options, warrants or rights to subscribe for or purchase
shares of, Junior Securities) shall be declared or paid or set apart for
payment or other distribution declared or made upon Junior Securities, nor
shall any Junior Securities be redeemed, purchased or otherwise acquired
(other than a redemption, purchase or other acquisition of shares of Common
Stock made for purposes of an employee incentive or benefit plan of the
Corporation or any subsidiary) (all such dividends, distributions,
redemptions or purchases being hereinafter referred to as a "Junior
Securities Distribution") for any consideration (or any moneys be paid to
or made available for a sinking fund for the redemption of any shares of
any such stock) by the Corporation, directly or indirectly (except by
conversion into or exchange for Junior Securities), unless in each case (i)
the full cumulative dividends on all outstanding shares of the Senior
Preferred Stock and any other Parity Securities shall (to the extent
payable in cash) have been paid or set apart for payment for all past
Dividend Periods with respect to the Senior Preferred Stock and all past
dividend periods with respect to such Parity Securities and (ii) (to the
extent payable in cash) sufficient funds shall have been paid or set apart
for the payment of the dividend for the current Dividend Period with
respect to the Senior Preferred Stock and the current dividend period with
respect to such Parity Securities.
(4) Liquidation Preference. (a) In the event of any liquidation,
dissolution or winding up of the Corporation, whether voluntary or
involuntary, before any payment or distribution of the assets of the
Corporation (whether capital or surplus) shall be made to or set apart for
the holders of Junior Securities, the holders of the shares of Senior
Preferred Stock shall be entitled to receive an amount equal to the
Liquidation Value of such share plus any accrued and unpaid cash dividends
to the date of distribution. "Liquidation Value" on any date means, with
respect to (x) any share of Senior Preferred Stock other than any
Additional Shares, the sum of (1) $25.00 per share and (2) the aggregate of
all dividends accreted on such share until the most recent Dividend Payment
Date upon which an accretion to Liquidation Value has occurred (or if such
date is a Dividend Payment Date upon which an accretion to Liquidation
Value has occurred, such date), provided that in the event of an actual
liquidation, dissolution or winding up of the Corporation or the redemption
of any shares of Senior Preferred Stock pursuant to Section 5 hereunder,
the amount referred to in (2) shall be calculated by including dividends
accreting to the actual date of such liquidation, dissolution or winding up
or the redemption date, as the case may be, rather than the Dividend
Payment Date referred to above and provided further that in no event will
dividends accrete beyond the earlier of (i) the Cash Pay Date and (ii) the
most recent Dividend Payment Date prior to the Dividend Payment Date on
which dividends on the Senior Preferred Stock are payable in Additional
Shares and (y) any Additional Share, the Applicable Liquidation Value. All
accretions to Liquidation Value will be calculated using compounding on a
quarterly basis. Except as provided in the preceding sentences, holders of
shares of Senior Preferred Stock shall not be entitled to any distribution
in the event of liquidation, dissolution or winding up of the affairs of
the Corporation. If, upon any liquidation, dissolution or winding up of the
Corporation, the assets of the Corporation, or proceeds thereof,
distributable among the holders of the shares of Senior Preferred Stock
shall be insufficient to pay in full the preferential amount aforesaid and
liquidating payments on any Parity Securities, then such assets, or the
proceeds thereof, shall be distributed among the holders of shares of
Senior Preferred Stock and any such other Parity Securities ratably in
accordance with the respective amounts that would be payable on such shares
of Senior Preferred Stock and any such other stock if all amounts payable
thereon were paid in full. For the purposes of this paragraph (4), (i) a
consolidation or merger of the Corporation with one or more corporations,
or (ii) a sale or transfer of all or substantially all of the Corporation's
assets, shall not be deemed to be a liquidation, dissolution or winding up,
voluntary or involuntary, of the Corporation.
(b) Subject to the rights of the holders of any Parity Securities,
after payment shall have been made in full to the holders of the Senior
Preferred Stock, as provided in this paragraph (4), any other series or
class or classes of Junior Securities shall, subject to the respective
terms and provisions (if any) applying thereto, be entitled to receive any
and all assets remaining to be paid or distributed, and the holders of the
Senior Preferred Stock shall not be entitled to share therein.
(c) The "Applicable Liquidation Value" of any Additional Shares shall
be the Liquidation Value of Senior Preferred Stock outstanding immediately
prior to the first Dividend Payment Date occurring after a request for
payment in Additional Shares has been made in accordance with Section 3(b).
(5) Redemption. (a) Redemption At the Option of the Corporation. To
the extent the Corporation shall have funds legally available for such
payment, the Corporation may, at its option, redeem shares of Senior
Preferred Stock, at any time in whole but not in part, at redemption prices
per share in cash set forth in the table below, together with accrued and
unpaid cash dividends thereon to the date fixed for redemption, without
interest:
-------- -------------------------------
Prior to Percentage of Liquidation Value
August 1,
2003 115.000
2004 107.500
2005 105.000
2006 102.500
-------- -------------------------------
Prior to Percentage of Liquidation Value
August 1,
Thereafter 100.000
(b) Redemption In the Event of a Change of Control. In the event of a
Change of Control, the Corporation shall, to the extent it shall have funds
legally available for such payment, offer to redeem all of the shares of
Senior Preferred Stock then outstanding, and shall redeem the shares of
Senior Preferred Stock of any holder of such shares that shall consent to
such redemption, upon a date no later than 30 days following the Change in
Control, at a redemption price per share equal to 101% of the Liquidation
Value, in cash, plus accrued and unpaid cash dividends thereon to the date
fixed for redemption, without interest.
"Change of Control" means such time as: (a) a "person" or "group"
(within the meaning of Sections 13(d) and 14(d)(2) of the Securities
Exchange Act of 1934, as amended), other than any person or group comprised
solely of the Initial Investors, has become the beneficial owner, by way of
merger, consolidation or otherwise, of 50% or more of the voting power of
all classes of voting securities of the Corporation, and such person or
group has become the beneficial owner of a greater percentage of the voting
power of all classes of voting securities of the Corporation than that
beneficially owned by the Initial Investors; or (b) a sale or transfer of
all or substantially all of the assets of the Corporation to any person or
group (other than any group consisting solely of the Initial Investors or
their affiliates) has been consummated; or (c) during any period of two
consecutive years, individuals who at the beginning of such period
constituted the Board of Directors of the Corporation (together with any
new directors whose election was approved by a vote of a majority of the
directors then still in office, who either were directors at the beginning
of such period or whose election or nomination for the election was
previously so approved) cease for any reason to constitute a majority of
the directors of the Corporation, then in office.
"Initial Investors" means the Stockholders (determined as of the
issuance of the Preferred Stock) and their Permitted Transferees, each as
defined in the Investors' Agreement.
"Investors' Agreement" means the Investors= Agreement dated as of
August 17, 1998 among Insilco Holding Co., DLJ Merchant Banking Partners
II, L.P., DLJ Merchant Banking Partners II-A, L.P., DLJ Offshore Partners
II, C.V., DLJ Diversified Partners, L.P., DLJ Diversified Partners-A, L.P.,
DLJ Millennium Partners, L.P., DLJ Millennium-A, L.P., DLJMB Funding II,
Inc., DLJ EAB Partners, L.P., DLJ First ESC L.P., UK Investment Plan 1997
Partners, DLJ ESC II, L.P., (collectively, the "DLJMB Funds"), and 399
Venture Partners, Inc., as amended.
(c) Mandatory Redemption. To the extent the Corporation shall have
funds legally available for such payment, on August 1, 2010, if any shares
of the Senior Preferred Stock shall be outstanding, the Corporation shall
redeem all outstanding shares of the Senior Preferred Stock, at a
redemption price equal to the aggregate Liquidation Value, in cash,
together with any accrued and unpaid cash dividends thereon to the date
fixed for redemption, without interest.
(d) Status of Redeemed Shares. Shares of Senior Preferred Stock which
have been issued and reacquired in any manner, including shares purchased
or redeemed, shall (upon compliance with any applicable provisions of the
laws of the State of Delaware) have the status of authorized and unissued
shares of the class of Preferred Stock undesignated as to series and may be
redesignated and reissued as part of any series of the Preferred Stock;
provided that no such issued and reacquired shares of Senior Preferred
Stock shall be reissued or sold as Senior Preferred Stock.
(e) Failure to Redeem. If the Corporation is unable or shall fail to
discharge its obligation to redeem all outstanding shares of Senior
Preferred Stock pursuant to paragraph (5)(b) or 5(c) (each, a "Mandatory
Redemption Obligation"), such Mandatory Redemption Obligation shall be
discharged as soon as the Corporation is able to discharge such Mandatory
Redemption Obligation. If and so long as any Mandatory Redemption
Obligation with respect to the Senior Preferred Stock shall not be fully
discharged, the Corporation shall not (i) directly or indirectly, redeem,
purchase, or otherwise acquire any Parity Security or discharge any
mandatory or optional redemption, sinking fund or other similar obligation
in respect of any Parity Securities (except in connection with a
redemption, sinking fund or other similar obligation to be satisfied pro
rata with the Senior Preferred Stock) or (ii) in accordance with paragraph
3(e), declare or make any Junior Securities Distribution, or, directly or
indirectly, discharge any mandatory or optional redemption, sinking fund or
other similar obligation in respect of the Junior Securities.
(f) Failure to Pay Dividends. Notwithstanding the foregoing provisions
of this paragraph (5), unless full cumulative cash dividends (whether or
not declared) on all outstanding shares of Senior Preferred Stock shall
have been paid or contemporaneously are declared and paid or set apart for
payment for all dividend periods terminating on or prior to the applicable
redemption date, none of the shares of Senior Preferred Stock shall be
redeemed, and no sum shall be set aside for such redemption, unless shares
of Senior Preferred Stock are redeemed pro rata.
(6) Procedure for Redemption. (a) In the event the Corporation shall
redeem shares of Senior Preferred Stock pursuant to Sections 5(a) or (c),
notice of such redemption shall be given by first class mail, postage
prepaid, mailed not less than 30 days nor more than 60 days prior to the
redemption date, to each holder of record of the shares to be redeemed at
such holder's address as the same appears on the stock register of the
Corporation; provided that neither the failure to give such notice nor any
defect therein shall affect the validity of the giving of notice for the
redemption of any share of Senior Preferred Stock to be redeemed except as
to the holder to whom the Corporation has failed to give said notice or
except as to the holder whose notice was defective. Each such notice shall
state: (i) the redemption date; (ii) the number of shares of Senior
Preferred Stock to be redeemed; (iii) the redemption price; (iv) the place
or places where certificates for such shares are to be surrendered for
payment of the redemption price; and (v) that dividends on the shares to be
redeemed will cease to accrue on such redemption date.
(b) In the case of any redemption pursuant to Sections 5(a) or (c)
hereof, notice having been mailed as provided in Section 6(a) hereof, from
and after the redemption date (unless default shall be made by the
Corporation in providing money for the payment of the redemption price of
the shares called for redemption), dividends on the shares of Senior
Preferred Stock so called for redemption shall cease to accrue, and all
rights of the holders thereof as stockholders of the Corporation (except
the right to receive from the Corporation the redemption price) shall
cease. Upon surrender in accordance with said notice of the certificates
for any shares so redeemed (properly endorsed or assigned for transfer, if
the Board of Directors of the Corporation shall so require and the notice
shall so state), such share shall be redeemed by the Corporation at the
redemption price aforesaid. In case fewer than all the shares represented
by any such certificate are redeemed, a new certificate shall be issued
representing the unredeemed shares without cost to the holder thereof.
(c) In the case of a redemption pursuant to Section 5(b) hereof,
notice of such redemption shall be given by first class mail, postage
prepaid, mailed not more than 10 days following the occurrence of the
Change of Control and not less than 20 days prior to the redemption date,
to each holder of record of the shares to be redeemed at such holder's
address as the same appears on the stock register of the Corporation;
provided that neither the failure to give such notice nor any defect
therein shall affect the validity of the giving of notice for the
redemption of any share of Senior Preferred Stock to be redeemed except as
to the holder to whom the Corporation has failed to give said notice or
except as to the holder whose notice was defective. Each such notice shall
state: (i) that a Change of Control has occurred; (ii) the redemption date;
(iii) the redemption price; (iv) that such holder may elect to cause the
Corporation to redeem all or any of the shares of Senior Preferred Stock
held by such holder; (v) the place or places where certificates for such
shares are to be surrendered for payment of the redemption price; and (vi)
that dividends on the shares the holder elects to cause the Corporation to
redeem will cease to accrue on such redemption date.
Upon receipt of such notice, the holder shall, within 20 days of
receipt thereof, return such notice to the Corporation indicating the
number of shares of Senior Preferred Stock such holder shall elect to cause
the Corporation to redeem, if any.
(d) In the case of a redemption pursuant to Section 5(b) hereof,
notice having been mailed as provided in Section 6(c) hereof, from and
after the redemption date (unless default shall be made by the Corporation
in providing money for the payment of the redemption price of the shares
called for redemption), dividends on such shares of Senior Preferred Stock
as the holder elects to cause the Corporation to redeem shall cease to
accrue, and all rights of the holders thereof as stockholders of the
Corporation (except the right to receive from the Corporation the
redemption price) shall cease. Upon surrender in accordance with said
notice of the certificates for any shares so redeemed (properly endorsed or
assigned for transfer, if the Board of Directors of the Corporation shall
so require and the notice shall so state), such share shall be redeemed by
the Corporation at the redemption price aforesaid. In case fewer than all
the shares represented by any such certificate are redeemed, a new
certificate shall be issued representing the unredeemed shares without cost
to the holder thereof.
(7) Exchange. (a) Subject to the provisions of this paragraph (7) the
Corporation may, at its option, at any time and from time to time on any
Dividend Payment Date, exchange, to the extent it is legally permitted to
do so, all, but not less than all, outstanding shares (and fractional
shares) of Senior Preferred Stock, for Exchange Debentures, provided that
(i) on or prior to the date of exchange the Corporation shall have paid to
or declared and set aside for payment to the holders of outstanding shares
of Senior Preferred Stock all accrued and unpaid cash dividends on shares
of Senior Preferred Stock through the exchange date in accordance with the
next succeeding paragraph; (ii) no event of default under the indenture (as
defined in such indenture) governing the Exchange Debentures shall have
occurred and be continuing; and (iii) no shares of Senior Preferred Stock
are held on such date by the DLJMB Funds or any of their Affiliates, or any
of their Permitted Transferees. The principal amount of Exchange Debentures
deliverable upon exchange of a share of Senior Preferred Stock, adjusted as
hereinafter provided, shall be determined in accordance with the Exchange
Ratio (as defined below).
Cash dividends on any shares of Senior Preferred Stock exchanged for
Exchange Debentures which have accrued but have not been paid as of the
date of exchange shall be paid in cash. In no event shall the Corporation
issue Exchange Debentures in denominations other than $1,000 or in an
integral multiple thereof. Cash will be paid in lieu of any such fraction
of an Exchange Debenture which would otherwise have been issued (which
shall be determined with respect to the aggregate principal amount of
Exchange Debentures to be issued to a holder upon any such exchange).
Interest will accrue on the Exchange Debentures from the date of exchange.
Prior to effecting any exchange hereunder, the Corporation shall
appoint a trustee to serve in the capacity contemplated by an indenture
between the Corporation and such trustee, containing customary terms and
conditions.
The Exchange Ratio shall be, as of any Dividend Payment Date, $1.00
(or fraction thereof) of principal amount of Exchange Debenture for each
$1.00 of (i) Liquidation Value plus (ii) accrued and unpaid cash dividends,
if any, per share of Senior Preferred Stock held by a holder on the
applicable exchange date.
"Affiliates" shall have the meaning ascribed such term in the
Investors' Agreement.
"Exchange Debentures" means 15% Subordinated Exchange Debentures due
2010 of the Corporation, to be issued pursuant to an indenture between the
Corporation and a trustee, containing customary terms and conditions, in
accordance with the Term Sheet attached as Annex A hereto.
"Permitted Transferees" shall have the meaning ascribed to such term
in the Investors' Agreement.
(b) Procedure for Exchange. (i) In the event the Corporation shall
exchange shares of Senior Preferred Stock, notice of such exchange shall be
given by first class mail, postage prepaid, mailed not less than 30 days
nor more than 60 days prior to the exchange date, to each holder of record
of the shares to be exchanged at such holder's address as the same appears
on the stock register of the Corporation; provided that neither the failure
to give such notice nor any defect therein shall affect the validity of the
giving of notice for the exchange of any share of Senior Preferred Stock to
be exchanged except as to the holder to whom the Corporation has failed to
give said notice or except as to the holder whose notice was defective.
Each such notice shall state: (A) the exchange date; (B) the number of
shares of Senior Preferred Stock to be exchanged and, if fewer than all the
shares held by such holder are to be exchanged, the number of shares to be
exchanged from such holder; (C) the Exchange Ratio; (D) the place or places
where certificates for such shares are to be exchanged for notes evidencing
the Exchange Debentures to be received by the exchanging holder; and (E)
that dividends on the shares to be exchanged will cease to accrue on such
exchange date.
(ii) Prior to giving notice of intention to exchange, the
Corporation shall execute and deliver with a bank or trust
company selected by the Corporation an indenture containing
customary terms and conditions. The Corporation will cause the
Exchange Debentures to be authenticated on the Dividend Payment
Date on which the exchange is effective, and will pay interest on
the Exchange Debentures at the rate and on the dates specified in
such indenture from the exchange date.
The Corporation will not give notice of its intention to exchange
under paragraph 6(b)(i) hereof unless it shall file at the place or places
(including a place in the Borough of Manhattan, The City of New York)
maintained for such purpose an opinion of counsel (who may be an employee
of the Corporation) to the effect that (i) the indenture has been duly
authorized, executed and delivered by the Corporation, has been duly
qualified under the Trust Indenture Act of 1939 (or that such qualification
is not necessary) and constitutes a valid and binding instrument
enforceable against the Corporation in accordance with its terms (subject,
as to enforcement, to bankruptcy, insolvency, reorganization and other laws
of general applicability relating to or affecting creditors' rights and to
general equity principles, and subject to such other qualifications as are
then customarily contained in opinions of counsel experienced in such
matters), (ii) the Exchange Debentures have been duly authorized and, when
executed and authenticated in accordance with the provisions of the
indenture and delivered in exchange for the shares of Preferred Stock, will
constitute valid and binding obligations of the Corporation entitled to the
benefits of the indenture (subject as aforesaid), (iii) neither the
execution nor delivery of the indenture or the Exchange Debentures nor
compliance with the terms, conditions or provisions of such instruments
will result in a breach or violation of any of the terms or provisions of,
or constitute a default under, any indenture, mortgage, deed of trust or
agreement or instrument, known to such counsel, to which the Corporation or
any of its subsidiaries is a party or by which it or any of them is bound,
or any decree, judgment, order, rule or regulation, known to such counsel,
of any court or governmental agency or body having jurisdiction over the
Corporation and such subsidiaries or any of their properties, (iv) the
Exchange Debentures have been duly registered for such exchange with the
Securities and Exchange Commission under a registration statement that has
become effective under the Securities Act of 1933 (the "Act") or that the
exchange of the Exchange Debentures for the shares of Senior Preferred
Stock is exempt from registration under the Act, and (v) the Corporation
has sufficient legally available funds for such exchange such that such
exchange is permitted under applicable law.
(iii) Notice having been mailed as aforesaid, from and after the
exchange date (unless default shall be made by the Corporation in
issuing Exchange Debentures in exchange for the shares called for
exchange), dividends on the shares of Senior Preferred Stock so
called for exchange shall cease to accrue, and all rights of the
holders thereof as stockholders of the Corporation (except the
right to receive from the Corporation the Exchange Debentures and
any rights such holder, upon the exchange, may have as a holder
of the Exchange Debenture) shall cease. Upon surrender in
accordance with said notice of the certificates for any shares so
exchanged (properly endorsed or assigned for transfer, if the
Board of Directors of the Corporation shall so require and the
notice shall so state), such share shall be exchanged by the
Corporation for the Exchange Debentures at the Exchange Ratio. In
case fewer than all the shares represented by any such
certificate are exchanged, a new certificate shall be issued
representing the unexchanged shares without cost to the holder
thereof.
(iv) Each exchange shall be deemed to have been effected
immediately after the close of business on the relevant Dividend
Payment Date, and the person in whose name or names any Exchange
Debentures shall be issuable upon such exchange shall be deemed
to have become the holder of record of the Exchange Debentures
represented thereby at such time on such Dividend Payment Date.
(v) Prior to the delivery of any securities which the Corporation
shall be obligated to deliver upon exchange of the Senior
Preferred Stock, the Corporation shall comply with all applicable
federal and state laws and regulations which require action to be
taken by the Corporation.
(c) The Corporation will pay any and all documentary stamp or similar
issue or transfer taxes payable in respect of the issue or delivery of
notes evidencing Exchange Debentures on exchange of the Senior Preferred
Stock pursuant hereto; provided that the Corporation shall not be required
to pay any tax which may be payable in respect of any transfer involved in
the issue or delivery of Exchange Debentures in a name other than that of
the holder of the Senior Preferred Stock to be exchanged and no such issue
or delivery shall be made unless and until the person requesting such issue
or delivery has paid to the Corporation the amount of any such tax or has
established, to the satisfaction of the Corporation, that such tax has been
paid.
(8) Voting Rights. (a) The holders of record of shares of Senior
Preferred Stock shall not be entitled to any voting rights except as
hereinafter provided in this paragraph (8), as otherwise provided by law or
as provided in the Investors' Agreement.
(b) If and whenever (i) four consecutive or six quarterly cash
dividends payable on the Senior Preferred Stock have not been paid in full,
(ii) for any reason (including the reason that funds are not legally
available for a redemption), the Corporation shall have failed to discharge
any Mandatory Redemption Obligation (including a redemption in the Event of
a Change of Control pursuant to Section 5(b) hereof), (iii) the Corporation
shall have failed to provide the notice required by Section 6(d) hereof
within the time period specified in such section or (iv) the Corporation
shall have failed to comply with Sections 3(d), 3(e) or 8(c) hereof, (1)
the number of directors then constituting the Board of Directors shall be
increased by two and the holders of a majority of the outstanding shares of
Senior Preferred Stock, together with the holders of shares of every other
series of preferred stock upon which like rights have been conferred and
are exercisable (resulting from either the failure to pay dividends or the
failure to redeem) (any such series is referred to as the "Preferred
Shares"), voting as a single class regardless of series, shall be entitled
to elect the two additional directors to serve on the Board of Directors at
any annual meeting of stockholders or special meeting held in place
thereof, or at a special meeting of the holders of the Senior Preferred
Stock and the Preferred Shares called as hereinafter provided. Whenever (i)
all arrears in cash dividends on the Senior Preferred Stock and the
Preferred Shares then outstanding shall have been paid and cash dividends
thereon for the current quarterly dividend period shall have been paid or
declared and set apart for payment, (ii) the Corporation shall have
fulfilled its Mandatory Redemption Obligation, (iii) fulfilled its
obligation to provide notice as specified in subsection (b)(iii) hereof, or
(iv) the Corporation shall have complied with Sections 3(d), 3(e), or 8(c)
hereof, as the case may be, then the right of the holders of the Senior
Preferred Stock to elect such additional two directors shall cease (but
subject always to the same provisions for the vesting of such voting rights
in the case of any similar future (i) arrearage in six consecutive
quarterly cash dividends, (ii) failure to fulfill any Mandatory Redemption
Obligation, (iii) failure to fulfill the obligation to provide the notice
required by Section 6(d) hereof within the time period specified in such
section or (iv) failure to comply with Sections 3(d), 3(e), or 8(c)) and
the terms of office of all persons elected as directors by the holders of
the Senior Preferred Stock shall forthwith terminate and the number of the
Board of Directors shall be reduced accordingly. At any time after such
voting power shall have been so vested in the holders of shares of Senior
Preferred Stock and the Preferred Shares, the secretary of the Corporation
may, and upon the written request of any holder of Senior Preferred Stock
(addressed to the secretary at the principal office of the Corporation)
shall, call a special meeting of the holders of the Senior Preferred Stock
and of the Preferred Shares for the election of the two directors to be
elected by them as herein provided, such call to be made by notice similar
to that provided in the Bylaws of the Corporation for a special meeting of
the stockholders or as required by law. If any such special meeting
required to be called as above provided shall not be called by the
secretary within 20 days after receipt of any such request, then any holder
of shares of Senior Preferred Stock may call such meeting, upon the notice
above provided, and for that purpose shall have access to the stock books
of the Corporation. The directors elected at any such special meeting shall
hold office until the next annual meeting of the stockholders or special
meeting held in lieu thereof if such office shall not have previously
terminated as above provided. If any vacancy shall occur among the
directors elected by the holders of the Senior Preferred Stock and the
Preferred Shares, a successor shall be elected by the Board of Directors,
upon the nomination of the then-remaining director elected by the holders
of the Senior Preferred Stock and the Preferred Shares or the successor of
such remaining director, to serve until the next annual meeting of the
stockholders or special meeting held in place thereof if such office shall
not have previously terminated as provided above.
(c) Without the written consent of a majority of the outstanding
shares of Senior Preferred Stock or the vote of holders of a majority of
the outstanding shares of Senior Preferred Stock at a meeting of the
holders of Senior Preferred Stock called for such purpose, the Corporation
will not (i) amend, alter or repeal any provision of the Certificate of
Incorporation (by merger or otherwise) so as to adversely affect the
preferences, rights or powers of the Senior Preferred Stock; provided that
any such amendment that decreases the dividend payable on or the
Liquidation Value of the Senior Preferred Stock shall require the
affirmative vote of holders of each share of Senior Preferred Stock at a
meeting of holders of Senior Preferred Stock called for such purpose or
written consent of the holder of each share of Senior Preferred Stock; or
(ii) create, authorize or issue any class of stock ranking prior to, or on
a parity with, the Senior Preferred Stock with respect to dividends or upon
liquidation, dissolution, winding up or otherwise, or increase the
authorized number of shares of any such class or series, or reclassify any
authorized stock of the Corporation into any such prior or parity shares or
create, authorize or issue any obligation or security convertible into or
evidencing the right to purchase any such prior or parity shares, except
that the Corporation may, without such approval, create authorize and issue
Parity Securities for the purpose of utilizing the proceeds from the
issuance of such Parity Securities for the redemption or repurchase of all
outstanding shares of Senior Preferred Stock in accordance with the terms
hereof or of the Investors' Agreement.
(d) In exercising the voting rights set forth in this paragraph (8),
each share of Senior Preferred Stock shall have one vote per share, except
that when any other series of preferred stock shall have the right to vote
with the Senior Preferred Stock as a single class on any matter, then the
Senior Preferred Stock and such other series shall have with respect to
such matters one vote per $25.00 of Liquidation Value or other liquidation
preference. Except as otherwise required by applicable law or as set forth
herein, the shares of Senior Preferred Stock shall not have any relative,
participating, optional or other special voting rights and powers and the
consent of the holders thereof shall not be required for the taking of any
corporate action.
(9) Reports. So long as any of the Senior Preferred Stock is
outstanding, the Corporation will furnish the holders thereof with the
quarterly and annual financial reports that the Corporation is required to
file with the Securities and Exchange Commission pursuant to Section 13 or
Section 15(d) of the Securities Exchange Act of 1934 or, in the event the
Corporation is not required to file such reports, reports containing the
same information as would be required in such reports.
(10) General Provisions. (a)The term "Person" as used herein means any
corporation, limited liability company, partnership, trust, organization,
association, other entity or individual.
(b) The term "outstanding", when used with reference to shares of
stock, shall mean issued shares, excluding shares held by the Corporation
or a subsidiary.
(c) The headings of the paragraphs, subparagraphs, clauses and
subclauses used herein are for convenience of reference only and shall not
define, limit or affect any of the provisions hereof.
(d) Each holder of Senior Preferred Stock, by acceptance thereof,
acknowledges and agrees that payments of dividends, interest, premium and
principal on, and exchange, redemption and repurchase of, such securities
by the Corporation are subject to restrictions on the Corporation contained
in certain credit and financing agreements.
IN WITNESS WHEREOF, Insilco Holding Co. has caused this Certificate of
Designations to be signed and attested by the undersigned this 17th day of
August, 1998.
Insilco Holding Co.
By:
--------------------------------
Name:
Title:
ATTEST:
- - ------------------------
Name:
Title:
ANNEX A
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SUMMARY OF TERMS
OF INDENTURE FOR
15% SUBORDINATED EXCHANGE DEBENTURES
PARTIES: Insilco Holding Co. (the "Corporation") and [ ],
as trustee.
ISSUE: 15% Exchange Debentures (the "Exchange
Debentures") to be issued by the Corporation, at
its option, in exchange for any or all the
outstanding shares of 15% Senior Exchangeable
Preferred Stock due 2010 (the "Senior Preferred
Stock") issued on or about August 17, 1998 to DLJ
Merchant Banking Partners II, L.P. and certain of
its affiliates (the "DLJ Entities").
MATURITY: August 1, 2010.
INTEREST: 15% annual rate, payable semi-annually. Through
the tenth semi-annual interest payment period,
quarterly interest will accrete on a compound
basis (i.e. non-cash pay) and increase the face
amount of the Exchange Debentures, thereafter
interest will be payable in cash.
RANKING: The Exchange Debentures will rank senior to all
other subordinated debt (but junior to the Senior
Discount Debentures due 2008 of the Corporation
and the Corporation's guaranty of Insilco
Corporation's indebtedness under its Senior Credit
Facility), preferred stock and common equity of
the Corporation.
OPTIONAL REDEMPTION: The Exchange Debentures will be
redeemable at any time at the option of
the Corporation, in whole or in part, at
the same redemption prices set forth in
the designation of the Senior Preferred
Stock set forth in Article 4 of the
Restated Certificate of Incorporation of
the Surviving Corporation.
CHANGE OF CONTROL In the event of a Change of Control of
REPURCHASE RIGHT: the Corporation each holder of the Exchange
Debentures will have the right to require the
Corporation to repurchase all or any part of such
holder's Exchange Debentures at a purchase price
of 101% of the sum of the accreted value thereof
plus accrued and unpaid cash interest, if any, to
the repurchase date.
COVENANTS: The Debentures will contain covenants that are
substantially the same as the covenants contained
in the Indenture for the Senior Discount
Debentures due 2008 of the Corporation and will
limit, among other things, the ability of the
Corporation and its subsidiaries (i) to incur
additional indebtedness, (ii) to pay dividends and
make other distributions on its capital stock,
(iii) to repurchase its capital stock or warrants,
options or other rights to acquire shares of its
capital stock or any Indebtedness subordinated to
the Exchange Debentures, (iv) to make certain
other Restricted Payments, (v) to make certain
investments or asset sales, (vi) to engage in
transactions with affiliates, (vii) to create
liens, (viii) to permit "layering" of indebtedness
and (ix) to merge or consolidate or transfer all
or substantially all of its assets.
