UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
-----------------------
AMENDED AND RESTATED
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(AMENDMENT NO. 8)
-----------------------
SENECA FOODS CORPORATION
(Name of Issuer)
CLASS A COMMON STOCK, PAR VALUE $0.25
CLASS B COMMON STOCK, PAR VALUE $0.25
(Title of Class of Securities)
817070501
817070105
(CUSIP Number)
-----------------------
IRIS B. ROSKEN 1/
Carl Marks Management Company, L.P.
135 East 57th Street
New York, NY 10022-2032
Tel. No.: (212) 909-8400
(Name, Address and Telephone Number of
Person Authorized to Receive Notices
and Communications)
-----------------------
SEPTEMBER 2, 1998
(Date of Event which Requires Filing
of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
statement because of Rule 13d-1(b)(3) or (4), check the following box [ ].
Note: Six copies of this statement, including all exhibits, should be filed with
the Commission. See Rule 13d-1(a) for other parties to whom copies are to be
sent.
* The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter
disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities Exchange Act of
1934 ("Act") or otherwise subject to the liabilities of that section of the Act
but shall be subject to all other provisions of the Act (however, see the
Notes).
Page 1 of 45 Pages
- ----------
1/ Copy to: John C. Kennedy, Esq., Paul, Weiss, Rifkind, Wharton & Garrison,
1285 Avenue of the Americas, New York, New York 10019-6064, Tel: (212) 373-
3000.
<PAGE>
SCHEDULE 13D
CUSIP NO. 817070501 Page 2 of 45 Pages
---------
817070105
---------
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Carl Marks Strategic Investments, L.P.
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (A) [ ]
(B) [X]
3 SEC USE ONLY
4 SOURCE OF FUNDS
OO
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) [ ]
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
7 SOLE VOTING POWER
NUMBER OF 2,304,161 Shares of Class A Common Stock
SHARES
BENEFICIALLY OWNED 8 SHARED VOTING POWER
BY EACH REPORTING
PERSON
WITH
9 SOLE DISPOSITIVE POWER
2,304,161 Shares of Class A Common Stock
10 SHARED DISPOSITIVE POWER
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
2,304,161 Shares of Class A Common Stock
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES [X]
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
42.0%
14 TYPE OF REPORTING PERSON
PN
--------------
<PAGE>
SCHEDULE 13D
CUSIP NO. 817070501 Page 3 of 45 Pages
---------
817070105
---------
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Carl Marks Strategic Investments II, L.P.
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (A) [ ]
(B) [X]
3 SEC USE ONLY
4 SOURCE OF FUNDS
OO
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) [ ]
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
7 SOLE VOTING POWER
NUMBER OF 691,575 Shares of Class A Common Stock
SHARES
BENEFICIALLY OWNED 8 SHARED VOTING POWER
BY EACH REPORTING
PERSON
WITH
9 SOLE DISPOSITIVE POWER
691,575 Shares of Class A Common Stock
10 SHARED DISPOSITIVE POWER
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
691,575 Shares of Class A Common Stock
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES [X]
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
17.8%
14 TYPE OF REPORTING PERSON
PN
--------------
<PAGE>
SCHEDULE 13D
CUSIP NO. 817070501 Page 4 of 45 Pages
---------
817070105
---------
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Uranus Fund, Ltd.
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (A) [ ]
(B) [X]
3 SEC USE ONLY
4 SOURCE OF FUNDS
WC
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) [ ]
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Cayman Islands
7 SOLE VOTING POWER
NUMBER OF 24,159 Shares of Class A Common Stock
SHARES
BENEFICIALLY OWNED 8 SHARED VOTING POWER
BY EACH REPORTING
PERSON
WITH
9 SOLE DISPOSITIVE POWER
24,159 Shares of Class A Common Stock
10 SHARED DISPOSITIVE POWER
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
24,159 Shares of Class A Common Stock
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES [X]
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
0.8%
14 TYPE OF REPORTING PERSON
CO
--------------
<PAGE>
SCHEDULE 13D
CUSIP NO. 817070501 Page 5 of 45 Pages
---------
817070105
---------
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Carl Marks Management Company, L.P.
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (A) [ ]
(B) [X]
3 SEC USE ONLY
4 SOURCE OF FUNDS
N/A
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) [ ]
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
7 SOLE VOTING POWER
NUMBER OF 2,995,736 Shares of Class A Common Stock
SHARES
BENEFICIALLY OWNED 8 SHARED VOTING POWER
BY EACH REPORTING
PERSON
WITH
9 SOLE DISPOSITIVE POWER
2,995,736 Shares of Class A Common Stock
10 SHARED DISPOSITIVE POWER
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
2,995,736 Shares of Class A Common Stock
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES [X]
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
48.5%
14 TYPE OF REPORTING PERSON
PN
--------------
<PAGE>
SCHEDULE 13D
CUSIP NO. 817070501 Page 6 of 45 Pages
---------
817070105
---------
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Carl Marks Offshore Management, Inc.
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (A) [ ]
(B) [X]
3 SEC USE ONLY
4 SOURCE OF FUNDS
N/A
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) [ ]
6 CITIZENSHIP OR PLACE OF ORGANIZATION
New York
7 SOLE VOTING POWER
NUMBER OF 24,159 Shares of Class A Common Stock
SHARES
BENEFICIALLY OWNED 8 SHARED VOTING POWER
BY EACH REPORTING
PERSON
WITH
9 SOLE DISPOSITIVE POWER
24,159 Shares of Class A Common Stock
10 SHARED DISPOSITIVE POWER
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
24,159 Shares of Class A Common Stock
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES [X]
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
0.8%
14 TYPE OF REPORTING PERSON
CO
--------------
<PAGE>
SCHEDULE 13D
CUSIP NO. 817070501 Page 7 of 45 Pages
---------
817070105
---------
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Andrew M. Boas
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (A) [ ]
(B) [X]
3 SEC USE ONLY
4 SOURCE OF FUNDS
N/A
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) [ ]
6 CITIZENSHIP OR PLACE OF ORGANIZATION
United States Citizen
7 SOLE VOTING POWER
NUMBER OF 3,019,895 Shares of Class A Common Stock
SHARES
BENEFICIALLY OWNED 8 SHARED VOTING POWER
BY EACH REPORTING
PERSON
WITH
9 SOLE DISPOSITIVE POWER
3,019,895 Shares of Class A Common Stock
10 SHARED DISPOSITIVE POWER
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
3,019,895 Shares of Class A Common Stock
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES [X]
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
48.7%
14 TYPE OF REPORTING PERSON
IN
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<PAGE>
SCHEDULE 13D
CUSIP NO. 817070501 Page 8 of 45 Pages
---------
817070105
---------
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Robert C. Ruocco
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (A) [ ]
(B) [X]
3 SEC USE ONLY
4 SOURCE OF FUNDS
N/A
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) [ ]
6 CITIZENSHIP OR PLACE OF ORGANIZATION
United States Citizen
7 SOLE VOTING POWER
NUMBER OF 3,019,895 Shares of Class A Common Stock
SHARES
BENEFICIALLY OWNED 8 SHARED VOTING POWER
BY EACH REPORTING
PERSON
WITH
9 SOLE DISPOSITIVE POWER
3,019,895 Shares of Class A Common Stock
10 SHARED DISPOSITIVE POWER
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
3,019,895 Shares of Class A Common Stock
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES [X]
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
48.7%
14 TYPE OF REPORTING PERSON
IN
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<PAGE>
SCHEDULE 13D
CUSIP NO. 817070501 Page 9 of 45 Pages
---------
817070105
---------
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
CMCO, Inc.
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (A) [ ]
(B) [X]
3 SEC USE ONLY
4 SOURCE OF FUNDS
WC
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) [ ]
6 CITIZENSHIP OR PLACE OF ORGANIZATION
New York
7 SOLE VOTING POWER
NUMBER OF 232,568 Shares of Class A Common Stock
SHARES
BENEFICIALLY OWNED 8 SHARED VOTING POWER
BY EACH REPORTING
PERSON None
WITH
9 SOLE DISPOSITIVE POWER
232,568 Shares of Class A Common Stock
10 SHARED DISPOSITIVE POWER
None
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
232,568 Shares of Class A Common Stock
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES [X]
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
7.3%
14 TYPE OF REPORTING PERSON
CO
--------------
<PAGE>
SCHEDULE 13D
CUSIP NO. 817070501 Page 10 of 45 Pages
---------
817070105
---------
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
CMCO, Inc.
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (A) [ ]
(B) [X]
3 SEC USE ONLY
4 SOURCE OF FUNDS
WC
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) [ ]
6 CITIZENSHIP OR PLACE OF ORGANIZATION
New York
7 SOLE VOTING POWER
NUMBER OF 232,568 Shares of Class B Common Stock
SHARES
BENEFICIALLY OWNED 8 SHARED VOTING POWER
BY EACH REPORTING
PERSON None
WITH
9 SOLE DISPOSITIVE POWER
232,568 Shares of Class B Common Stock
10 SHARED DISPOSITIVE POWER
None
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
232,568 Shares of Class B Common Stock
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES [X]
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
8.3%
14 TYPE OF REPORTING PERSON
CO
--------------
<PAGE>
SCHEDULE 13D
CUSIP NO. 817070501 Page 11 of 45 Pages
---------
817070105
---------
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Edwin S. Marks
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (A) [ ]
(B) [X]
3 SEC USE ONLY
4 SOURCE OF FUNDS
PF
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) [ ]
6 CITIZENSHIP OR PLACE OF ORGANIZATION
United States Citizen
7 SOLE VOTING POWER
NUMBER OF 290,000 Shares of Class A Common Stock
SHARES
BENEFICIALLY OWNED 8 SHARED VOTING POWER
BY EACH REPORTING
PERSON 449,608 Shares of Class A Common Stock
WITH
9 SOLE DISPOSITIVE POWER
290,000 Shares of Class A Common Stock
10 SHARED DISPOSITIVE POWER
449,608 Shares of Class A Common Stock
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
739,608 Shares of Class A Common Stock
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES [X]
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
21.5%
14 TYPE OF REPORTING PERSON
IN
--------------
<PAGE>
SCHEDULE 13D
CUSIP NO. 817070501 Page 12 of 45 Pages
---------
817070105
---------
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Edwin S. Marks
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (A) [ ]
(B) [X]
3 SEC USE ONLY
4 SOURCE OF FUNDS
PF
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) [ ]
6 CITIZENSHIP OR PLACE OF ORGANIZATION
United States Citizen
7 SOLE VOTING POWER
NUMBER OF 145,000 Shares of Class B Common Stock
SHARES
BENEFICIALLY OWNED 8 SHARED VOTING POWER
BY EACH REPORTING
PERSON 335,088 Shares of Class B Common Stock
WITH
9 SOLE DISPOSITIVE POWER
145,000 Shares of Class B Common Stock
10 SHARED DISPOSITIVE POWER
335,088 Shares of Class B Common Stock
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
480,088 Shares of Class B Common Stock
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES [X]
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
17.2%
14 TYPE OF REPORTING PERSON
IN
--------------
<PAGE>
Page 13 of 45 Pages
The joint statement on Schedule 13D dated April 16, 1984, as amended on
September 19, 1988 by Amendment No. 1, as further amended on June 6, 1989 by
Amendment No. 2, as further amended on August 15, 1989 by Amendment No. 3, as
further amended on March 27, 1991 by Amendment No. 4, as further amended on
March 2, 1995 by Amendment No. 5, as further amended on December 12, 1995 by
Amendment No. 6 and as amended and restated on July 2, 1998 by Amendment No. 7,
is hereby amended and restated in its entirety as stated below. This amendment
reports certain transactions entered into on September 2, 1998. Because of the
relationship between CMCO, INC. (formerly Carl Marks & Co, Inc.) ("CMCO"), Edwin
S. Marks ("Marks" and, together with CMCO, the "Existing Marks Shareholders"),
Carl Marks Strategic Investments, L.P. (the "Partnership"), Carl Marks Strategic
Investments II, L.P. ("Partnership II"), Uranus Fund, Ltd. ("Uranus" and,
together with the Partnership and Partnership II, the "Investors"), Carl Marks
Management Company, L.P. (the "General Partner"), Carl Marks Offshore
Management, Inc. (the "Manager"), Andrew M. Boas ("Boas") and Robert C. Ruocco
("Ruocco") (collectively, the "Reporting Persons"), they have decided to report
jointly their interests in the common stock of Seneca Foods Corporation, a New
York corporation (the "Issuer").
ITEM 1. SECURITY AND ISSUER.
This statement on Schedule 13D relates to the Class A common stock, par
value $0.25 per share (the "Class A Common Stock") and Class B common stock, par
value $0.25 per share (the "Class B Common Stock" and, together with the Class A
Common Stock, the "Common Stock") of the Issuer. The principal executive offices
of the Issuer are located at 1162 Pittsford-Victor Road, Pittsford, New York
14534.
ITEM 2. IDENTITY AND BACKGROUND.
(a) This statement is filed by (i) the Partnership, a Delaware limited
partnership, (ii) Partnership II, a Delaware limited partnership, (iii) Uranus,
a Cayman Islands corporation, (iv) the General Partner, a Delaware limited
partnership and the sole general partner of each of the Partnership and
Partnership II, (v) the Manager, a New York corporation and the investment
manager of Uranus, (vi) Messrs. Boas and Ruocco, the two general partners of the
General Partner, (vii) CMCO, a New York corporation, and (viii) Marks, the
President of CMCO.
The Reporting Persons are filing this amended and restated Schedule 13D
in the event that they are deemed a "group" for purposes of Section 13(d) and
Rule 13d-1(f) under the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), because of their relationships and neither such filing nor
anything set forth herein shall be deemed to be an admission that such a "group"
exists. The capital stock of CMCO is owned by various members of the Marks
family (including Marks and Boas). Marks is an officer and a director of CMCO,
and Boas is an officer of CMCO. Marks is Boas' uncle.
<PAGE>
Page 14 of 45 Pages
The Schedule reports certain transactions entered into by the Investors
with the Issuer on September 2, 1998 and certain of the Existing Marks
Shareholders pursuant to the Rights Offering (as defined below). The Investors
purchased shares of the new series of convertible participating preferred stock
issued by the Issuer (the "Convertible Preferred Stock") pursuant to the Stock
Purchase Agreement (as defined below) and Marks simultaneously purchased shares
of the Convertible Preferred Stock in the Rights Offering. See Item 4 for a
description of such transactions.
(b)-(c) (i) The principal business of each of the Investors is
investment in securities. The general partner of the Partnership and Partnership
II is the General Partner. The investment manager of Uranus is the Manager. The
principal business of the General Partner and the Manager is investment
management, including the management of the Partnership, Partnership II and
Uranus. The business address of each of the Investors, the General Partner and
the Manager is 135 East 57th Street, New York, New York 10022.
(ii) The principal business of each of Messrs. Boas and Ruocco
is acting as general partner of the General Partner. In addition to serving as
general partners of the General Partner, Messrs. Boas and Ruocco are the only
directors, controlling persons and executive officers of the Manager. Boas is a
Vice President of Carl Marks & Co., Inc., which through affiliates is engaged in
a broad variety of investment activities, including securities trading, money
management, venture capital, real estate investing, corporate merchant banking
and work out activities. Boas is also a director of the Issuer. The business
address of Messrs. Boas and Ruocco is 135 East 57th Street, New York, New York
10022.
(iii) The principal business of CMCO is to act as a holding
company for various stock and limited partnership interests. The directors,
controlling persons and executive officers of CMCO are listed on the attached
Schedule A. The business address of CMCO is 135 East 57th Street, New York, New
York 10022.
(iv) Marks is a shareholder and President of each of CMCO and
Carl Marks & Co., Inc. Marks' business address is 135 East 57th Street, New
York, New York 10022.
(d) During the last five years, none of the Reporting Persons or the
other individuals listed on Schedule A has been convicted in a criminal
proceeding (excluding traffic violations or similar misdemeanors).
(e) During the last five years, none of the Reporting Persons or the
other individuals listed on Schedule A has been a party to a civil proceeding of
a judicial or administrative body of competent jurisdiction and as a result of
such proceeding was or is 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.
<PAGE>
Page 15 of 45 Pages
(f) Messrs. Boas, Ruocco and Marks and the other individuals listed on
Schedule A are each citizens of the United States of America.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
(a) The source of funds or other consideration used by the Existing
Marks Shareholders in making purchases of Common Stock or Convertible Preferred
Stock, as applicable, has been the working capital of CMCO or the personal funds
of Marks, as applicable.
(b) The source of funds or other consideration used by the Investors in
making purchases of Convertible Preferred Stock has been the capital
contributions of the Partnership and Partnership II or the working capital of
Uranus, as applicable. On September 2, 1998, the Investors paid the Issuer
aggregate consideration of $36,238,740 for: (i) 1,166,667 shares of Convertible
Preferred Stock purchased directly from the Issuer and (ii) 1,853,228 shares of
Convertible Preferred Stock acquired as standby purchasers in the Rights
Offering. See Item 4.
ITEM 4. PURPOSE OF TRANSACTION.
CMCO (or its predecessors) has been a shareholder of the Issuer since
1982 and Marks has been a shareholder since 1991.
On June 22, 1998, the Issuer and the Investors entered into a Stock
Purchase Agreement (the "Stock Purchase Agreement"), pursuant to which the
Investors agreed to make an equity investment in the Issuer in the form of the
Convertible Preferred Stock. A copy of the Stock Purchase Agreement is filed as
Exhibit 2(a) to the Issuer's Form 8-K filed with the Securities and Exchange
Commission (the "Commission"), dated July 2, 1998, and is incorporated herein by
reference.
Pursuant to the Stock Purchase Agreement, subject to the terms and
conditions therein, the Investors agreed to purchase (the "Purchase") 1,166,667
shares of Convertible Preferred Stock for an aggregate purchase price of
$14,000,004 (or $12.00 per share). In addition, the Stock Purchase Agreement
provided that the Issuer would conduct a $36 million rights offering (the
"Rights Offering" and together with the Purchase, the "Transaction"), whereby
each holder of the Issuer's Common Stock could purchase shares of the
Convertible Preferred Stock. The Rights Offering commenced on August 7, 1998 and
each holder (a "Rights Holder") received one-half of a right (a "Right") to
purchase shares of the Convertible Preferred Stock at a subscription price of
$12.00 per share (the "Subscription Price"). Each whole Right entitled a Rights
Holder to receive, upon payment of the Subscription Price, one share of
Convertible Preferred Stock.
The Rights Offering expired on August 27, 1998. Upon the expiration of
the Rights Offering, the Rights Holders exercised 2,293,276 Rights to purchase
1,146,639 shares of Convertible Preferred Stock. The shares of Convertible
<PAGE>
Page 16 of 45 Pages
Preferred Stock are immediately convertible share-for-share into Class A Common
Stock at any time. The Convertible Preferred Stock does not pay regular
dividends (except for dividends paid at the same rate and at the same time as
dividends paid on the Common Stock).
Subject to the terms and conditions of the Stock Purchase Agreement,
the Investors had agreed to act as standby purchasers of up to 2.5 million
shares of Convertible Preferred Stock not purchased by the Issuer's shareholders
in the Rights Offering. On September 2, 1998, the Investors acquired, as standby
purchasers, 1,853,228 shares of Convertible Preferred Stock in addition to the
1,166,667 shares of Convertible Preferred Stock purchased directly from the
Issuer.
In connection with the Stock Purchase Agreement, on June 22, 1998, the
Issuer, the Investors, CMCO, Marks, Nancy A. Marks and Marjorie Boas entered
into a Shareholders Agreement (the "Shareholders Agreement") with the following
existing shareholders (each, an "Existing Shareholder") who currently own in the
aggregate approximately 19.1% and 23.8% of the issued and outstanding shares of
Class A Common Stock and Class B Common Stock, respectively: Arthur S. Wolcott,
Individually and as Trustee, Audrey S. Wolcott, as Trustee, Kraig H. Kayser,
Individually and as Trustee for certain Kayser family trusts, Susan W. Stuart,
Individually and as Trustee for Alexius Lyle Wadell and Kyle Aaron Wadell,
Donald Stuart, Kurt Kayser, Karl Kayser, Marilyn W. Kayser, Robert Oppenheimer,
as Trustee of certain Kayser family trusts, Mark S. Wolcott, Individually and as
Trustee for Erin Lorraine Wolcott and Cassandra Jean Wolcott, Kari Wolcott,
Bruce S. Wolcott, Individually and as Trustee for Kaitlin Kerr Wolcott, Michael
Stanton Wolcott and Paige Strode Wolcott, Constance Wolcott, Grace W. Wadell,
Individually and as Trustee for Sara Elizabeth Stuart, Jennifer Grace Stuart and
Donald Arthur Stuart, and Aaron Wadell. A copy of the Shareholders Agreement is
filed as Exhibit 2(b) to the Issuer's Form 8-K filed with the Commission, dated
July 2, 1998, and is incorporated herein by reference.
Pursuant to the Shareholders Agreement, each Existing Shareholder
agreed, among other things, to: (i) overall limitations and restrictions for a
two year period on their ability to sell or otherwise transfer shares of the
Issuer's capital stock owned by each of them; (ii) following such two year
restricted period discussed in item (i), an obligation to offer the Investors an
opportunity to participate in the sale of any capital stock of the Issuer owned
by any Existing Shareholder; and (iii) certain changes to the Issuer's Board of
Directors, as discussed below. The Shareholders Agreement also provides the
Investors with the right (subject to certain limitations), in the event that the
Issuer issues any voting securities (or any securities convertible into or
exercisable or exchangeable for such securities), to purchase a certain
percentage of any new issuance in order to maintain their percentage ownership
in the Issuer. To the extent an individual Investor does not purchase its
respective percentage of such new issuance, the remaining Investors will be
granted the right to purchase such percentage.
<PAGE>
Page 17 of 45 Pages
The Shareholders Agreement required that the Issuer's Board of
Directors be increased by two persons (from seven to nine directors), who were
chosen by the Investors and nominated for election to the Board of Directors at
the annual meeting of the shareholders of the Issuer held on August 7, 1998 (the
"Investor Designees"). The Investors designated Boas and Arthur H. Baer, both of
whom were subsequently elected to serve as directors. The Shareholders Agreement
also provides that the Investor Designees will constitute at least 22% of the
members on any committee of the Board of Directors. The Investor Designees will
continue to be nominated for election to the Board of Directors and the Existing
Shareholders will continue to vote for the Investor Designees until the Stock
Purchase Agreement is terminated or such time as the Investors no longer own, in
the aggregate, at least 10% of the Class A Common Stock (assuming conversion of
all shares of Convertible Preferred Stock into Class A Common Stock).
Pursuant to the Stock Purchase Agreement, the Issuer also amended its
Certificate of Incorporation (the "Charter Amendments") to: (i) increase the
number of authorized shares of Class A Common Stock from 10,000,000 shares to
20,000,000 shares; (ii) increase the number of authorized shares of Preferred
Stock with $.025 par value per share, Class A from 4,000,000 shares to 8,200,000
shares; (iii) set forth the rights, preferences and limitations of the
Convertible Preferred Stock; (iv) require unanimous board approval, in
accordance with Section 709 of the New York Business Corporation Law, of the
Major Corporate Actions (as defined below); and (v) remove the acquisition by
the Investors of Class A Common Stock issuable upon conversion of the
Convertible Preferred Stock from the operation of certain "Class A Special
Rights" provisions of the Certificate of Incorporation. The "Class A Special
Rights" provision grants certain rights to the holders of the Class A Common
Stock in the event that a person attempts to gain control of the Company and
certain conditions are satisfied. The Charter Amendments also require unanimous
approval of the Issuer's Board of Directors (excluding Directors who abstain
from voting) for certain defined major corporate actions (the "Major Corporate
Actions"), including: (i) any amendment or modification to the Issuer's Restated
Certificate of Incorporation, as amended, or its Bylaws; (ii) any business
combination involving the Issuer or a subsidiary of the Issuer; (iii) any sale
or transfer of all or substantially all of the Issuer's assets; (iv) certain
issuances of securities; (v) any acquisition or disposition or series of related
acquisitions or dispositions of assets involving gross consideration in excess
of $15 million; (vi) any change in the Issuer's line of business; (vii) any
change in the Issuer's certified public accountants; (viii) the settlement of
certain litigation; or (ix) the commencement by the Issuer of proceedings
relating to bankruptcy, insolvency, reorganization or relief of debtors. The
requirement for unanimous approval of the Board of Directors (excluding
Directors who abstain from voting) will terminate when the Investors no longer
own, in the aggregate, at least 15% of the Issuer's Class A Common Stock
(assuming conversion of all shares of Convertible Preferred Stock into shares of
Class A Common Stock). The Issuer's Certificate of Amendment of its Certificate
of Incorporation is attached as Exhibit 1.
<PAGE>
Page 18 of 45 Pages
The Investors entered into the Stock Purchase Agreement in order to
acquire a significant interest in the Issuer. The Investors and the Investor
Designees expect to consult frequently with management concerning the Issuer's
operations and future plans. The Reporting Persons intend to review continuously
their position in the Issuer. Depending upon future evaluations of the business
prospects of the Issuer and upon other developments, including, but not limited
to, general economic and business conditions, stock market conditions, tax
considerations and performance of the Common Stock, each of the Reporting
Persons may, from time to time, acquire additional Convertible Preferred Stock,
Common Stock or other securities, retain its Convertible Preferred Stock and
Common Stock, or dispose of all or a portion of its holdings, subject to any
applicable legal and contractual restrictions on its ability to do so.
Except as set forth in this Item 4, the Reporting Persons have no
present plans or proposals that relate to or that would result in any of the
actions specified in clauses (b) through (j) of Item 4 of Schedule 13D of the
Exchange Act.
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER.
(a) - (b)(i) CMCO beneficially owns 232,568 shares of Class A Common
Stock, comprising approximately 7.3% of the 3,187,808 outstanding shares of
Class A Common Stock on September 2, 1998. CMCO also beneficially owns 232,568
shares of Class B Common Stock, comprising approximately 8.3% of the 2,796,555
outstanding shares of Class B Common Stock on September 2, 1998.
CMCO has the sole power to direct the vote and the sole power to
dispose of or to direct the disposition of 232,568 shares of Class A Common
Stock on September 2, 1998. These powers would be exercised for CMCO by its
executive officers or the Board of Directors. CMCO has the sole power to vote or
to direct the vote and the sole power to dispose of or to direct the disposition
of 232,568 shares of Class B Common Stock. These powers would be exercised for
CMCO by its executive officers or the Board of Directors.
(ii) Marks beneficially owns 739,608 shares of Class A Common
Stock, comprising approximately 21.5% of the outstanding shares of Class A
Common Stock on September 2, 1998 (assuming conversion of his, his wife's and
his daughters' Convertible Preferred Stock into Class A Common Stock on a
share-for-share basis), which include 251,520 shares of Convertible Preferred
Stock and 110,520 shares of Class A Common Stock, each of which he beneficially
owns and shares voting and dispositive power over with his wife, Nancy A. Marks,
and his daughters (collectively, the "Daughters") and 232,568 shares of which
are owned by CMCO. Marks disclaims the beneficial ownership of all stock owned
by his wife and Daughters.
Marks beneficially owns 480,088 shares of Class B Common Stock,
comprising approximately 17.2% of the outstanding shares, which include 102,520
shares of Class B Common Stock beneficially owned by his wife and 232,568 shares
<PAGE>
Page 19 of 45 Pages
of which are owned by CMCO. Marks disclaims the beneficial ownership of all
stock owned by his wife.
Marks has the sole power to vote or to direct the vote and the sole
power to dispose or to direct the disposition of 290,000 shares of Class A
Common Stock (assuming conversion of his Convertible Preferred Stock into Class
A Common Stock on a share-for-share basis). He shares such powers to vote and to
dispose of 449,608 shares of Class A Common Stock (assuming conversion of his,
his wife's and his Daughters' Convertible Preferred Stock into Class A Common
Stock on a share-for-share basis), consisting of 104,520 shares of Class A
Common Stock and 103,520 shares of Convertible Preferred Stock of which he
shares such powers with his wife, 6,000 shares of Class A Common Stock and 3,000
shares of Convertible Preferred Stock of which he shares such powers with his
Daughters, and of 232,568 shares of Class A Common Stock by virtue of being
President of CMCO.
Marks has the sole power to vote or to direct the vote and the sole
power to dispose or to direct the disposition of 145,000 shares of Class B
Common Stock. He shares such powers to vote and to dispose of 335,088 shares of
Class B Common Stock, consisting of 102,520 shares of which he shares such
powers with his wife and of 232,568 shares by virtue of being President of CMCO.
(iii) The Partnership, Partnership II and Uranus beneficially
own in the aggregate 2,304,161 shares of Class A Common Stock, 691,575 shares of
Class A Common Stock and 24,159 shares of Class A Common Stock (consisting of
2,304,161 shares, 691,575 shares and 24,159 shares of Convertible Preferred
Stock that is convertible into Class A Common Stock on a share-for-share basis),
respectively, constituting 42.0%, 17.8% and 0.8% of such outstanding stock on
September 2, 1998.
The Partnership has sole voting and dispositive power over 2,304,161
shares of Class A Common Stock, constituting 42.0% of the 5,491,969 shares of
Class A Common Stock that were issued and outstanding as of September 2, 1998
(assuming conversion of all of the Partnership's Convertible Preferred Stock
into Class A Common Stock on a share-for-share basis). Partnership II and Uranus
have sole voting and dispositive power over 691,575 shares of Class A Common
Stock and 24,159 shares of Class A Common Stock, respectively, constituting
17.8% and 0.8% of such outstanding shares (assuming conversion of all of
Partnership II's or Uranus' Convertible Preferred Stock into Class A Common
Stock on a share-for-share basis, as applicable).
(iv) In its capacity as the sole general partner of the
Partnership and Partnership II, the General Partner may be deemed to be the
beneficial owner of 2,995,736 shares of Class A Common Stock deemed to be
beneficially owned by the Partnership and Partnership II (assuming conversion of
all of the Partnership's and Partnership II's Convertible Preferred Stock into
Class A Common Stock on a share-for-share basis), constituting 48.5% of the
outstanding shares of such stock.
<PAGE>
Page 20 of 45 Pages
The General Partner may be deemed to have sole voting and dispositive
power over 2,995,736 shares of Class A Common Stock (representing shares of
Convertible Preferred Stock beneficially owned by the Partnership and
Partnership II), constituting 48.5% of such outstanding stock (assuming
conversion of all of the Partnership's and Partnership II's Convertible
Preferred Stock into Class A Common Stock on a share-for-share basis).
(v) In its capacity as manager of Uranus, the Manager may be
deemed to be the beneficial owner of 24,159 shares of Class A Common Stock
(assuming conversion of all of Uranus' Convertible Preferred Stock into Class A
Common Stock on a share-for-share basis), constituting 0.8% of the outstanding
shares of such stock.
The Manager may be deemed to have sole voting and dispositive power
over 24,159 shares of Class A Common Stock (representing shares of Convertible
Preferred Stock beneficially owned by Uranus), constituting 0.8% of such
outstanding stock (assuming conversion of all of Uranus' Convertible Preferred
Stock into Class A Common Stock on a share-for-share basis).
(vi) In their capacity as general partners of the Partner and
directors, controlling persons and executive officers of the Manager, Messrs.
Boas and Ruocco may each be deemed to be the beneficial owners of 3,019,895
shares of Class A Common Stock (assuming conversion of all of the Investors'
Convertible Preferred Stock into Class A Common Stock on a share-for-share
basis), constituting 48.7% of the outstanding shares of such stock.
Messrs. Boas and Ruocco may be deemed to have sole voting and
dispositive power over 3,019,895 shares of Class A Common Stock (representing
shares of Convertible Preferred Stock beneficially owned by the Partnership,
Partnership II and Uranus), constituting 48.7% of such outstanding stock
(assuming conversion of all of the Investors' Convertible Preferred Stock into
Class A Common Stock on a share-for-share basis).
(c) Except as described in Item 4, none of the Reporting Persons has
effected any transactions in the Common Stock or the Convertible Preferred Stock
during the past 60 days.
(d) No person other than the Reporting Persons and the other persons
referred to in this Item 5 is known to have the right to receive or the power to
direct the receipt of dividends from the sale of the shares of Common Stock or
the Convertible Preferred Stock listed in this Item 5.
(e) Not applicable.
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH
RESPECT TO SECURITIES OF THE ISSUER.
<PAGE>
Page 21 of 45 Pages
None, except as set forth in Item 4.
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS.
Exhibit
Number Description
- ------- -----------
Incorporated by reference to Stock Purchase Agreement, dated as of June 22,
Exhibit 2(a) of the Issuer's 1998, by and among the Issuer and the Investors.
Form 8-K, dated July 2,
1998, filed with the
Commission
Incorporated by reference to Shareholders Agreement, dated as of June 22,
Exhibit 2(b) of the Issuer's 1998, by and among the Issuer, the Investors and
Form 8-K, dated July 2, certain existing shareholders specified therein.
1998, filed with the
Commission
Incorporated by reference to Registration Rights Agreement, dated as of
Exhibit 2(c) of the Issuer's June 22, 1998, by and among the Issuer, the
Form 8-K, dated July 2, Investors, Edwin S. Marks, Nancy Marks,
1998, filed with the Marjorie Boas and CMCO, Inc.
Commission
Exhibit 1: Certificate of Amendment of the Issuer's
Certificate of Incorporation
Exhibit 2: Joint Filing Agreement
<PAGE>
Page 22 of 45 Pages
SIGNATURE
After reasonable inquiry and to the best of the knowledge and belief of
the undersigned, each of the undersigned certifies that the information set
forth in this statement is true, complete and correct.
Dated: September 9, 1998
CARL MARKS STRATEGIC INVESTMENTS, L.P.
By: Carl Marks Management Company, L.P.,
its general partner
By: /s/ Andrew M. Boas
----------------------
Name: Andrew M. Boas
Title: General Partner
CARL MARKS STRATEGIC INVESTMENTS II, L.P.
By: Carl Marks Management Company, L.P.,
its general partner
By: /s/ Andrew M. Boas
----------------------
Name: Andrew M. Boas
Title: General Partner
URANUS FUND, LTD.
By: Carl Marks Offshore Management, Inc.,
its Investment Manager
By: /s/ Andrew M. Boas
----------------------
Name: Andrew M. Boas
Title: President
CARL MARKS MANAGEMENT COMPANY, L.P.
By: /s/ Andrew M. Boas
----------------------
Name: Andrew M. Boas
Title: General Partner
<PAGE>
Page 23 of 45 Pages
CARL MARKS OFFSHORE MANAGEMENT, INC.
By: /s/ Andrew M. Boas
----------------------
Name: Andrew M. Boas
Title: President
/s/ Andrew M. Boas
------------------
Andrew M. Boas
/s/ Robert C. Ruocco
--------------------
Robert C. Ruocco
CMCO, INC.
By: /s/ Mark Claster
--------------------
Name: Mark Claster
Title: Managing Director
/s/ Edwin S. Marks
------------------
Edwin S. Marks
<PAGE>
Page 24 of 45 Pages
Schedule A
CMCO, INC.
Set forth below is the name, current business address, and the present
principal occupation or employment of each director and executive officer of
CMCO, INC. Unless otherwise indicated, each person identified below is employed
by CMCO. The principal address of CMCO, and unless otherwise indicated below,
the current business address for each individual listed below, is 135 East 57th
Street, New York, New York 10022. Each person listed below is a citizen of the
United States.
Present Principal Occupation or
Name and Address Employment
Directors:
----------
Edwin Marks Investor
Nancy A. Marks Retired
Marjorie Boas Retired
Officers:
---------
Edwin Marks President
Andrew Boas Vice-President
Mark Claster Vice-President
<PAGE>
Page 25 of 45 Pages
EXHIBIT INDEX
<TABLE>
<CAPTION>
<S> <C> <C>
Exhibit Sequential
Number Description Page Number
- ------- ----------- -----------
Incorporated by reference to Stock Purchase Agreement, dated as of June 22,
Exhibit 2(a) of the Issuer's 1998, by and among the Issuer and the Investors.
Form 8-K, dated July 2,
1998, filed with the
Commission
Incorporated by reference to Shareholders Agreement, dated as of June 22,
Exhibit 2(b) of the Issuer's 1998, by and among the Issuer, the Investors and
Form 8-K, dated July 2, certain existing shareholders specified therein.
1998, filed with the
Commission
Incorporated by reference to Registration Rights Agreement, dated as of
Exhibit 2(c) of the Issuer's June 22, 1998, by and among the Issuer, the
Form 8-K, dated July 2, Investors, Edwin S. Marks, Nancy Marks,
1998, filed with the Marjorie Boas and CMCO, Inc.
Commission
Exhibit 1: Certificate of Amendment of the Issuer's
Certificate of Incorporation
Exhibit 2: Joint Filing Agreement
</TABLE>
Page 26 of 45 Pages
Exhibit 1
---------
CERTIFICATE OF AMENDMENT
OF THE
CERTIFICATE OF INCORPORATION
OF
SENECA FOODS CORPORATION
------------------------
Under Section 805 of the
Business Corporation Law
------------------------
We, the undersigned, being the President and Secretary of SENECA FOODS
CORPORATION, do hereby certify as follows:
FIRST: The name of the Corporation is SENECA FOODS CORPORATION. The name
under which the Corporation was formed is SENECA GRAPE JUICE CORPORATION.
SECOND: The certificate of incorporation of the Corporation was filed by the
Department of State on August 17, 1949.
THIRD: The certificate of incorporation of the Corporation hereby is amended
to:
(a) Increase the number of authorized shares of Class A Common Stock,
$0.25 par value per share from ten million (10,000,000) shares to twenty million
(20,000,000) shares; and
(b) Increase the number of authorized shares of Preferred Stock with
$.025 par value, Class A from four million (4,000,000) shares to eight million
two hundred thousand (8,200,000) shares.
To accomplish this, Article 3 of the certificate of incorporation,
hereby is amended to read in its entirety as follows:
(a) The Capital Stock of the Corporation shall consist of twenty
million (20,000,000) shares of Class A Common Stock of the par value of $0.25
each; ten million (10,000,000) shares of Class B Common Stock of the par value
of $0.25 each; two hundred thousand (200,000) shares of Six Percent (6%) Voting
Cumulative Preferred Stock of the par value of $0.25 each; thirty thousand
(30,000) shares of Preferred Stock Without Par Value, to be issued in series by
the Board of Directors, pursuant to the provisions of Article 4, Section (c)
hereof, subject to the limitations prescribed by law; and eight million two
hundred thousand (8,200,000) shares of Preferred Stock with $.025 par value,
Class A, to be issued in series by the Board of Directors pursuant to the
provisions of Article 4, Section (d) hereof, subject to the limitations
prescribed by law.
<PAGE>
Page 27 of 45 Pages
FOURTH: Article 4, paragraph (a)(C) of the certificate of incorporation of the
Corporation hereby is amended as follows:
(a) The definition of "Person" in paragraph (a)(C)(ii) hereby is
amended to read in its entirety as follows:
As used in this Article 4(a)(C), "Person" shall include one or more
persons or entities who act or agree to act in concert with respect to the
acquisition or disposition of Class B Common Stock or with respect to proposing
or effecting a plan or proposal to (a) a merger, reorganization or liquidation
of the Corporation or a sale of a material amount of its assets, (b) a change in
the Corporation's Board of Directors or management, including any plans or
proposal to fill vacancies on the Board of Directors or change the number or
term of Directors, (c) a material change in the business or corporate structure
of the Corporation, or (d) any material change in the capitalization or dividend
policy of the Corporation. As used in the preceding sentence, "act or agree to
act in concert" shall not include acts or agreements to act by persons pursuant
to their official capacities as Directors or officers of the Corporation or
because they are related by blood or marriage; it being determined for purposes
of this paragraph that the agreements dated as of June 22, 1998 made with
respect to capitalization and management changes between the Corporation,
certain of its directors and officers and various shareholders, including
certain shareholders related to said directors and officers and the Investors
(as defined in paragraph (a)(C)(iii) of this Article 4), as they may be amended
from time to time, were "acts or agreements to act by persons pursuant to their
official capacities as Directors or officers of the Corporation or because they
are related by blood or marriage."
(b) The following new paragraph (a)(C)(iii) hereby is added to Article
4:
"(iii) For purposes of Article 4(a)(C)(ii), any shares of
Participating Preferred Stock (as defined in paragraph (d)(F) of this Article 4)
held by Carl Marks Strategic Investments, L.P., Carl Marks Strategic
Investments, II, L.P., Uranus Fund, Ltd., or any of their Affiliates (as defined
in paragraph (d)(F) of this Article 4) (the "Investors") shall be deemed to have
been converted into shares of Class A Common Stock that are acquired after the
Threshold Date. Any such shares of Class A Common Stock deemed to be held by the
Investors or their Affiliates pursuant to the preceding sentence or any shares
of Class A Common Stock issued upon conversion of the Convertible Participating
Preferred Stock and held by the Investors shall be deemed to have been acquired
for an "equitable price" for purposes of Article 4(a)(C)(ii)."
(c) The existing paragraph (a)(C)(iii) hereby is renumbered as
paragraph (a)(C)(iv).
FIFTH: The certificate of incorporation of the Corporation is amended to
permit the Board of Directors to provide for additional or participating
distributions to holders of shares of Preferred Stock with $.025 Par Value,
Class A.
<PAGE>
Page 28 of 45 Pages
To accomplish this, Article 4, paragraph (d)(C) hereby is amended to
read in its entirety as follows:
(C) In the event of any voluntary or involuntary liquidation,
dissolution or winding up of the Corporation, the holders of shares of
each series of Class A Preferred Stock then outstanding shall be
entitled to receive out of the assets of the Corporation, before any
distribution or payment shall be made to the holders of any class of
common stock, an amount equal to the stated value of the stock plus, in
respect of each share with respect to which dividends are cumulative, a
sum computed at the dividend rate or dividend amount provided for in
the certificate of incorporation from and after the date on which
dividends on such shares became cumulative to and including the date
fixed for such payment, less the aggregate of the dividends theretofore
paid thereon, but computed without interest. If the amounts payable on
liquidation in respect to the shares of all series of Class A Preferred
Stock are not paid in full, the shares of all series of such class
shall share ratably in any distribution of assets other than by way of
dividends in accordance with the sums which would be payable in such
distribution if all sums payable were discharged in full. If such
payment shall have been made in full to the holders of all shares of
Class A Preferred Stock on voluntary or involuntary liquidation,
dissolution or winding up of the Corporation, the remaining assets of
the Corporation shall, except as otherwise provided herein, be
distributed among the holders of each class of common stock pro rata in
accordance with their respective holdings. For the purpose of this
paragraph, a consolidation or merger of the Corporation with one or
more other corporations shall not be deemed to be a liquidation or
winding up of the Corporation. In addition to the above-stated
distributions to holders of preferred stock, the Board of Directors is
authorized, in the rights, preferences and other provisions with
respect to any one or more series of Class A Preferred Stock, to
provide for additional or participating distributions to holders of
shares of such series on liquidation, dissolution or winding up of the
Corporation.
SIXTH: The certificate of incorporation of the Corporation hereby is amended
to authorize a third series of Class A Preferred Stock to be designated
Convertible Participating Preferred Stock.
To accomplish this, the following new Article 4(d)(F) hereby is added
to the certificate of incorporation:
"(F) Third Series of Class A Preferred Stock. The third series of
4,166,667 shares of Class A Preferred Stock shall be designated Convertible
Participating Preferred Stock (hereinafter "Participating Preferred Stock"), and
shall have the following rights, preferences and limitations:
<PAGE>
Page 29 of 45 Pages
(i) Stated Value. The stated value for each share of
Participating Preferred Stock shall be $12 (the "Stated Value").
(ii) Dividends and Distributions. At any time after the Issue
Date, the holders of each share of Participating Preferred Stock shall be
entitled to receive, when and as declared by the Board of Directors, but out of
funds legally available therefor, a dividend or distribution in cash, evidences
of indebtedness of the Corporation or another issuer, options, warrants or
rights to acquire securities or other property (including, without limitation,
rights issued pursuant to a shareholder rights plan, "poison pill" or similar
plan or arrangement and options or rights granted to each holder of Class A
Common Stock), securities of the Corporation or another issuer (excluding
securities for which adjustment is made under paragraph (vii)(d)(1) or paragraph
(vii)(d)(2)) or other property or assets, including, without limitation, any
such distribution made in connection with a consolidation or merger in which the
Corporation is the resulting or surviving corporation), at a rate per share (and
in the type of property) equal to the amount of any dividend or distribution
(and in the same type of property) as that declared or made on any shares
(including, without limitation, Class A Common Stock) into which one share of
Participating Preferred Stock may be converted pursuant to paragraph (vii) below
on the record date for such dividend or distribution. Any such dividend or
distribution shall be paid to the holders of shares of Participating Preferred
Stock at the same time such dividend or distribution is made to the holders of
the shares of Class A Common Stock. No dividend or distribution shall be
declared or made on any shares of Class A Common Stock unless any dividend or
distribution required to be declared or made under the first sentence of this
paragraph is previously or simultaneously declared or made. Dividends and
distributions shall be cumulative from and after the date of issuance of such
shares of Participating Preferred Stock, but any arrearage in payment shall not
pay interest.
(iii) Voting Rights. (a) Except as otherwise required by law
or as set forth in paragraph (b), the holders of shares of Participating
Preferred Stock shall not be entitled or permitted to vote on any matter
required or permitted to be voted upon by the shareholders of the Corporation.
(b) Unless the consent or approval of a greater
number of shares shall then be required by law, the affirmative vote of the
holders of at least 66- 2/3% of the outstanding shares of Participating
Preferred Stock, voting separately as a single class, in person or by proxy, at
a special or annual meeting of shareholders called for the purpose, shall be
necessary to (i) authorize the issuance after the Issue Date of any class of
capital stock that will rank as to payment of dividends or rights on
liquidation, dissolution or winding up of the Corporation senior to the
Participating Preferred Stock, (ii) authorize, adopt or approve an amendment to
the certificate of incorporation that would increase or decrease the par value
of the shares of Participating Preferred Stock, (iii) amend, alter or repeal the
certificate of incorporation so as to affect the shares of Participating
Preferred Stock adversely or (iv) effect the voluntary liquidation, dissolution,
winding up, recapitalization or reorganization of the Corporation, or the
consolidation or merger of the Corporation with or into any other Person, or the
sale or other distribution to another Person of all or substantially all of the
assets of the Corporation; provided, however, that no separate vote of the
holders of Participating Preferred Stock shall be
<PAGE>
Page 30 of 45 Pages
required to effect any of the transactions described in clause (iv) above unless
such transaction would either require a class vote pursuant to clause (i), (ii)
or (iii) above or would require a vote by any shareholders of the Corporation.
(iv) Redemption. The shares of Participating Preferred Stock
shall not be redeemed or subject to redemption, whether at the option of the
Corporation or any holder thereof, or otherwise.
(v) Acquired Shares. Any shares of Participating Preferred
Stock converted, exchanged, redeemed, purchased or otherwise acquired by the
Corporation or any of its subsidiaries in any manner whatsoever shall be retired
and canceled promptly after the acquisition thereof. All such shares of
Participating Preferred Stock shall upon their cancellation become authorized
but unissued shares of Class A Preferred Stock and, upon the filing of an
appropriate certificate with the Department of State of the State of New York,
may be reissued as part of another series of Class A Preferred Stock subject to
the conditions or restrictions on issuance set forth herein, but in any event
may not be reissued as shares of Participating Preferred Stock unless all of the
shares of Participating Preferred Stock issued on the Issue Date shall have
already been converted or exchanged.
(vi) Participating Distribution upon Liquidation of the
Corporation. In addition to the preferential distribution payable to holders of
Participating Preferred Stock equal to the Stated Value (the "Preferential
Distribution") as provided for under Article 4(d)(C) of this certificate of
incorporation, an additional participating distribution shall be payable to
holders of Participating Preferred Stock upon voluntary or involuntary
liquidation, dissolution or winding up of the Corporation (the "Participating
Distribution") with the effect that the total distribution to holders of the
Participating Preferred Stock shall be the greater of (a) the Preferential
Distribution or (b) the total distribution which holders of Participating
Preferred Stock would have received if all outstanding shares of Participating
Preferred Stock were converted into shares of common stock immediately prior to
the date for calculating the total distribution available to holders of
preferred stocks and common stocks. To achieve the distribution required by the
preceding sentence, the following calculation shall be made:
(1) Calculate the sum of (a) the total amounts
available for distribution to holders of all
classes of common stock after payment of all
preferential distributions to all classes of
preferred stocks of the Corporation, including
the Preferential Distribution to Participating
Preferred Stock, plus (b) the total amount of the
Preferential Distribution to holders of all
outstanding shares of Participating Preferred
Stock.
(2) Divide the sum calculated in subparagraph (1) by
the total number of shares of common stock into
which the Participating Preferred Stock is
convertible and of all classes of common stock
deemed outstanding for
<PAGE>
Page 31 of 45 Pages
purposes of calculating the distribution on
liquidation, dissolution or winding up of the
Corporation. The product of this calculation is
the "Per Share Distribution on Assumed
Conversion."
(3) The excess, if any, of the Per Share Distribution
on Assumed Conversion over the Preferential
Distribution to each share of Participating
Preferred Stock shall be distributed as a
Participating Distribution to the holders of the
Participating Preferred Stock upon liquidation,
dissolution or winding up of the Corporation.
(vii) Conversion. (a) Any holder of Participating Preferred
Stock shall have the right, as its option, at any time (but subject to the
provisions of paragraph (vii)(b)) to convert, subject to the terms and
provisions of this paragraph (vii), any or all of such holder's shares of
Participating Preferred Stock into such number of fully paid and nonassessable
shares of Class A Common Stock as is equal to the product of the number of
shares of Participating Preferred Stock being so converted multiplied by the
quotient of (i) the Stated Value divided by (ii) the conversion price of $12.00
per share, subject to adjustment as provided in paragraph (vii)(d) (the
"Conversion Price"), then in effect. Such conversion right shall be exercised by
the surrender of the shares of Participating Preferred Stock to be converted to
the Corporation at any time during usual business hours at its principal place
of business to be maintained by it, accompanied by written notice that the
holder elects to convert such shares and specifying the name or names (with
addresses) in which a certificate or certificates for shares of Class A Common
Stock are to be issued and (if so required by the Corporation) by a written
instrument or instruments of transfer in form reasonably satisfactory to the
Corporation duly executed by the holder or its duly authorized legal
representative and transfer tax stamps or funds therefor, if required pursuant
to paragraph (vii)(k). All shares of Participating Preferred Stock surrendered
for conversion shall be delivered to the Corporation for cancellation and
canceled by it and no shares shall be issued in lieu thereof.
(b) As promptly as practicable after the surrender,
as herein provided, of any shares of Participating Preferred Stock for
conversion pursuant to paragraph (vii)(a), the Corporation shall deliver to or
upon the written order of the holder of the shares so surrendered a certificate
or certificates representing the number of fully paid non-assessable shares of
Class A Common Stock into which such shares may be or have been converted in
accordance with the provisions of this paragraph (vii). Subject to the following
provisions of this paragraph and of paragraph (vii)(d), such conversion shall be
deemed to have been made immediately prior to the close of business on the date
that such shares shall have been surrendered in satisfactory form for
conversion, and the Person or Persons entitled to receive the Class A Common
Stock deliverable upon conversion of such shares shall be treated for all
purposes as having become the record holder or holders of such Class A Common
Stock at such time.
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Page 32 of 45 Pages
(c) To the extent permitted by law, when shares of
Participating Preferred Stock are converted, all unpaid dividends (whether or
not currently payable) on the Participating Preferred Stock so converted to the
date of conversion shall be immediately due and payable and must accompany the
shares of the Class A Common Stock issued upon such conversion.
(d) The Conversion Price shall be subject to
adjustment as follows:
(1) In case the Corporation shall at any
time or from time to time (A) pay a dividend or make a distribution on the
outstanding shares of Class A Common Stock in Class A Common Stock, (B)
sub-divide the outstanding shares of Class A Common Stock into a larger number
of shares, (C) combine the outstanding shares of Class A Common Stock into a
smaller number of shares or (D) issue any shares of its capital stock in a
reclassification of the Class A Common Stock, then, and in each such case, the
Conversion Price in effect immediately prior to such event shall be adjusted
(and any other appropriate actions shall be taken by the Corporation) so that
the holder of any share of Participating Preferred Stock thereafter surrendered
for conversion shall be entitled to receive the number of shares of Class A
Common Stock or other capital stock of the Corporation that such holder would
have owned or would have been entitled to receive upon or by reason of any of
the events described above, had such share of Participating Preferred Stock been
converted immediately prior to the occurrence of such event. An adjustment made
pursuant to this paragraph (vii)(d)(1) shall become effective retroactively (A)
in the case of any such dividend or distribution, to the opening of business on
the day immediately following the close of business on the record date for the
determination of holders of Class A Common Stock entitled to receive such
dividend or distribution or (B) in the case of any such subdivision, combination
or reclassification, to the close of business on the day upon which such
corporate action becomes effective.
(2) In case the Corporation shall at any
time or from time to time issue or sell shares of Class A Common Stock or Class
B Common Stock (or securities convertible into or exchangeable for shares of
Class A Common Stock or Class B Common Stock), or any options, warrants or other
rights to acquire shares of Class A Common Stock or Class B Common Stock (other
than (x) options granted to any employee or director of the Corporation pursuant
to a stock option plan approved by the shareholders of the Corporation, (y)
options, warrants or rights granted to each holder of Class A Common Stock or
(z) rights issued pursuant to a shareholder right plans, "poison pill" or
similar arrangement that complies with paragraph (vii)(j)) for a consideration
per share less than the Current Market Price at the record date or issuance
date, as the case may be (the "Date"), referred to in the following sentence
(treating the price per share of any security convertible or exchangeable or
exercisable into Class A Common Stock and/or Class B Common Stock as equal to
(A) the sum of the price for such security convertible, exchangeable or
exercisable into Class A Common Stock and/or Class B Common Stock plus any
additional consideration payable (without regard to any anti-dilution
adjustments) upon the conversion, exchange or exercise of such security into
Class A Common Stock and/or Class B Common Stock divided by (B) the number of
shares of Class A Common Stock and/or Class B Common Stock initially underlying
such
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convertible, exchangeable or exercisable security), other than issuances or
sales for which an adjustment is made pursuant to another paragraph of this
paragraph (vii)(d), then, and in each case, the Conversion Price then in effect
shall be adjusted by dividing the Conversion Price in effect on the day
immediately prior to the Date by a fraction (x) the numerator of which shall be
the sum of the numbers of shares of Class A Common Stock and Class B Common
Stock outstanding immediately prior to the Date plus the number of additional
shares of Class A Common Stock and Class B Common Stock issued or to be issued
(or the maximum number into which such convertible or exchangeable securities
initially may convert or exchange or for which such options, warrants or other
right initially may be exercised) and (y) the denominator of which shall be the
sum of the number of shares of Class A Common Stock and Class B Common Stock
outstanding immediately prior to the Date plus the number of shares of Class A
Common Stock and Class B Common Stock that the aggregate consideration (if any
of such aggregate consideration is other than cash, as valued by the Board of
Directors including a majority of the directors who are not officers or
employees of the Corporation or any of its subsidiaries, which determination
shall be conclusive and described in a resolution of the Board of Directors) for
the total number of such additional shares of Class A Common Stock and/or Class
B Common Stock so issued (or into which such convertible or exchangeable
securities may convert or exchange for which such options, warrants or other
rights may be exercised plus the aggregate amount of any additional
consideration initially payable upon conversion, exchange or exercise of such
security) would purchase at the Current Market Price. Such adjustment shall be
made whenever such shares, securities, options, warrants or other rights are
issued, and shall become effective retroactively to a date immediately following
the close of business (i) in the case of issuance to shareholders of the
Corporation, as such, on the record date for the determination of shareholders
entitled to receive such shares, securities, options, warrants or other rights
and (ii) in all other cases, on the date (the "Issuance Date") of such issuance;
provided, however, that the determination as to whether an adjustment is
required to be made pursuant to this paragraph (vii)(d)(2) shall only be made
upon the issuance of such shares or such convertible or exchangeable securities,
options, warrants or other rights, and not upon the issuance of the security
into which such convertible or exchangeable security converts or exchanges, or
the security underlying such options, warrants or other right.
(3) In case the Corporation or any
subsidiary thereof shall, at any time or from time to time while any of the
Participating Preferred Stock is outstanding, make a Pro Rata Repurchase, the
Conversion Price shall be adjusted by dividing the Conversion Price in effect
immediately prior to such action by a fraction (which in no event shall be less
than one), the numerator of which shall be the product of (i) the number of
shares of Class A Common Stock and Class B Common Stock outstanding immediately
before such Pro Rata Repurchase minus the number of shares of Class A Common
Stock and Class B Common Stock repurchased in such Pro Rata Repurchase and (ii)
the Current Modified Market Price as of the day immediately preceding the first
public announcement by the Corporation of the intent to effect such Pro Rata
Repurchase, and the denominator of which shall be (i) the product of (x) the
number of shares of Class A Common Stock and Class B Common Stock outstanding
immediately before such Pro Rata Repurchase and (y) the Current Modified Market
Price as of the day
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Page 34 of 45 Pages
immediately preceding the first public announcement by the Corporation of the
intent to effect such Pro Rata Repurchase minus (ii) the aggregate purchase
price of the Pro Rata Repurchase.
(4) In case the Corporation at any time or
from time to time shall take any action affecting its Class A Common Stock,
other than an action described in any of paragraph (vii)(d)(1) through paragraph
(vii)(d)(3), inclusive, or paragraph (vii)(g), then, the Conversion Price shall
be adjusted in such manner and at such time as the Board of Directors of the
Corporation in good faith determines to be equitable in the circumstances (such
determinations to be evidenced in a resolution, a certified copy of which shall
be mailed to the holders of the Participating Preferred Stock).
(5) The Corporation may make such reductions
in the Conversion Price, in addition to those required by subparagraphs (1)
through (4) of this paragraph (vii)(d), as the Board of Directors considers to
be advisable in order to avoid or to diminish any income tax to holders of Class
A Common Stock or rights to purchase Class A Common Stock resulting from any
dividend or distribution of stock (or rights to acquire stock) or from any event
treated as such for income tax purposes.
(6) Notwithstanding anything herein to the
contrary, no adjustment of the Conversion Price shall be required pursuant to
this paragraph (vi)(d) by reason of the initial issuance or sale of any of the
4,166,667 authorized shares of Participating Preferred Stock.
(7) Notwithstanding anything herein to the
contrary, no adjustment under this paragraph (vii)(d) need to be made to the
Conversion Price unless such adjustment would require an increase or decrease of
at least 1% of the Conversion Price then in effect. Any lesser adjustment shall
be carried forward and shall be made at the time of and together with the next
subsequent adjustment, which, together with any adjustment or adjustments so
carried forward, shall amount to an increase or decrease of at least 1% of such
Conversion Price. Any adjustment to the Conversion Price carried forward and not
theretofore made shall be made immediately prior to the conversion of any shares
of Participating Preferred Stock pursuant hereto; provided, however, that any
such adjustment shall in any event be made no later than one year after the
occurrence of the event giving rise to such adjustment.
(e) Upon any increase or decrease in the Conversion
Price, then, and in each such case, the Corporation promptly shall deliver to
each registered holder of Participating Preferred Stock at least ten Business
Days prior to effecting any of the foregoing transactions a certificate, signed
by the President or a Vice President and by the Treasurer or an Assistant
Treasurer or the Secretary or an Assistant Secretary of the Corporation, setting
forth in reasonable detail the event requiring the adjustment and the method by
which such adjustment was calculated and specifying the increased or decreased
Conversion Price then in effect following such adjustment.
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Page 35 of 45 Pages
(f) No fractional shares or scrip representing
fractional shares shall be issued upon the conversion of any shares of
Participating Preferred Stock. If more than one share of Participating Preferred
Stock shall be surrendered for conversion at one time by the same holder, the
number of full shares of Class A Common Stock issuable upon conversion thereof
shall be computed on the basis of the aggregate Stated Value of the shares of
Participating Preferred Stock so surrendered. If the conversion of any share or
shares of Participating Preferred Stock results in a fraction, an amount equal
to such fraction multiplied by the Current Market Price of the Class A Common
Stock on the Business Day preceding the day of conversion shall be paid to such
holder in cash by the Corporation on the date of issuance of the certificates
representing the shares by the Corporation upon such conversion.
(g) In case of any capital reorganization or
reclassification or other change of outstanding shares of Class A Common Stock,
or in case of any consolidation or merger of the Corporation with or into
another Person (other than a consolidation or merger in which the Corporation is
the resulting or surviving Person and which does not result in any
reclassification or change of outstanding Class A Common Stock), or in case of
any sale or other disposition to another Person of all or substantially all of
the assets of the Corporation (any of the foregoing, a "Transaction"), the
Corporation, or such successor or purchasing Person, as the case may be, shall
execute and deliver to each holder of Participating Preferred Stock at least ten
Business Days prior to effecting any of the foregoing Transactions a certificate
that the holder of each share of Participating Preferred Stock then outstanding
shall have the right hereafter to convert such share of Participating Preferred
Stock into the kind and amount of shares of stock or other securities (of such
Corporation or another issuer) or property or cash receivable upon such
Transaction by a holder of the number of shares of Class A Common Stock into
which such share of Participating Preferred Stock could have been converted
immediately prior to such transaction. Such certificate shall provide for
adjustments that shall be as nearly equivalent as may be practicable to the
adjustments provided for in this paragraph (vii). If, in the case of any such
Transaction, the stock, other securities, cash or property receivable thereupon
by a holder of Class A Common Stock includes shares of stock or other securities
of a Person other than the successor or purchasing Person and other than the
Corporation, which controls or is controlled by the successor or purchasing
Person or which, in connection with such Transaction, issues, stock securities,
other property or cash to holders of Class A Common Stock, then such certificate
also shall be executed by such Person, and such Person shall, in such
certificate, specifically acknowledge the obligations of such successor or
purchasing Person and acknowledge its obligations to issue such stock,
securities, other property or cash to the holders of the Participating Preferred
Stock upon conversion of the shares of Participating Preferred Stock as provided
above. The provisions of this paragraph (vii) and any equivalent thereof in any
such certificate similarly shall apply to successive Transactions.
(h) In case at any time or from time to time:
(1) the Corporation shall authorize the
granting to the holders of its Class A Common Stock of rights or warrants to
subscribe for or purchase any shares of stock of any class or of any other
rights or warrants;
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Page 36 of 45 Pages
(2) there shall be any reclassification of
the Class A Common Stock (other than a subdivision or combination of the
outstanding Class A Common Stock, or a change in par value, or from par value to
no par value, or from no par value to par value), or any consolidation or merger
to which the Corporation is a party and for which approval of any shareholders
of the Corporation is required, or any sale or other disposition of all or
substantially all of the assets of the Corporation; or
(3) the voluntary or involuntary
dissolution, liquidation or winding up of the Corporation;
then the Corporation shall mail to each holder of shares of Participating
Preferred Stock at such holder's address as it appears on the transfer books of
the Corporation, at least 20 days prior to the applicable date hereinafter
specified, a notice stating (x) the date on which a record is to be taken for
the purpose of such rights or warrants or, if a record is not to be taken, the
date as of which the holders of Class A Common Stock of record to be entitled to
such rights are to be determined, or (y) the date on which such
reclassification, consolidation, merger, sale, conveyance, dissolution,
liquidation or winding up is expected to become effective. Such notice also
shall specify the date as of which it is expected that holders of Class A Common
Stock of record shall be entitled to exchange their Class A Common Stock for
shares of stock or other securities or property or cash deliverable upon such
reclassification, consolidation, merger, sale, conveyance, dissolution,
liquidation or winding up.
(i) The Corporation shall at all times reserve and
keep available for issuance upon the conversion of the Participating Preferred
Stock, such number of its authorized but unissued shares of Class A Common Stock
as will from time to time be sufficient to permit the conversion of all
outstanding shares of Participating Preferred Stock.
(j) The Corporation shall not adopt a shareholder
rights plan, "poison pill" or similar arrangement unless such plan or
arrangement shall provide that each holder of a share of Participating Preferred
Stock shall be entitled to receive thereunder rights for each share of Class A
Common Stock that may be issued upon conversion of such share of Participating
Preferred Stock in an amount equal to the amount of rights issued with respect
to each outstanding share of Class A Common Stock pursuant to such plan.
(k) The issuance or delivery of certificates for
Class A Common Stock upon the conversion of shares of Participating Preferred
Stock shall be made without charge to the converting holder of shares of
Participating Preferred Stock for such certificates or for any tax in respect of
the issuance or delivery of such certificates or the securities represented
thereby, and such certificates shall be issued or delivered in the respective
names of, or in such names as may be directed by, the holders of the shares of
Participating Preferred Stock converted; provided, however, that the Corporation
shall not be required to pay any tax that may be payable in respect of any
transfer involved in the issuance and delivery of any such certificate in a name
other than that of the holder of the shares of Participating Preferred Stock
converted, and the
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Page 37 of 45 Pages
Corporation shall not be required to issue or deliver such certificates unless
or until the Person or Persons requesting the issuance or delivery thereof shall
have paid to the Corporation the amount of such tax or shall have established to
the reasonable satisfaction of the Corporation that such tax has been paid.
(l) To the extent that pursuant to the terms of this
paragraph (vii), the Participating Preferred Stock is convertible into any
securities or property other than Class A Common Stock, then for purposes of
this Article 4(d)(F), references to Class A Common Stock shall be deemed
appropriately amended to refer to such other securities or property.
(viii) Definitions. As used in this Article 4(d)(F), the
following terms shall have the meanings indicated:
(a) An "Affiliate" of, or a person "affiliated" with
a specified Person, means a Person that directly, or indirectly through one or
more intermediaries, controls, or is controlled by, or is under common control
with, the Person specified. The term "control" (including the terms
"controlling," "controlled by" and "under common control with") means the
possession, direct or indirect, of the power to direct or cause the direction of
the management and policies of a person, whether through the ownership of voting
securities, by contract, or otherwise.
(b) "Business Day" shall mean any day other than a
Saturday, Sunday or other day on which commercial banks in the City of New York
are authorized or required by law or executive order to close.
(c) "Current Market Price" per share shall mean, on
any date specified herein for the determination thereof, (A) the average daily
Market Price of the Class A Common Stock for those days during the period
commencing not more than 30 days before, and ending not later than such date, on
which the national securities exchanges were open for trading or the Class A
Common Stock was quoted in the over-the-counter market, and (B) if the Class A
Common Stock is not then listed or admitted to trading on any national
securities exchange or quoted in the over-the-counter market, the Market Price
on such date.
(d) "Current Modified Market Price" per share shall
mean, on any date specified herein for the determination thereof, (A) the
average daily Modified Market Price of the Class A Common Stock for those days
during the period commencing not more than 30 days before, and ending not later
than such date, on which the national securities exchanges were open for trading
or the Class A Common Stock was quoted in the over-the-counter market, and (B)
if the Class A Common Stock is not then listed or admitted to trading on any
national securities exchange or quoted in the over-the-counter market, the
Modified Market Price on such date.
(e) "Exchange Act" shall mean the Securities Exchange
Act of 1934, as amended, and the rules and regulations of the Securities and
Exchange Commission thereunder.
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Page 38 of 45 Pages
(f) "Fair Market Value" shall mean the amount which a
willing buyer would pay a willing seller in an arm's length transaction.
(g) "Issue Date" shall mean the first date on which
shares of Participating Preferred Stock are issued.
(h) "Market Price" shall mean, per share of Class A
Common Stock, on any date specified herein: (a) the closing price per share of
the Class A Common Stock on such date published in The Wall Street Journal or,
if no such closing price on such date is published in The Wall Street Journal,
the closing bid price on such date, as officially reported on the principal
national securities exchange on which the Class A Common Stock is then listed or
admitted to trading; or (b) if the Class A Common Stock is not then listed or
admitted to trading on any national securities exchange but is designated as a
national market system security by the NASD, the last trading price of the Class
A Common Stock on such date; or (c) if there shall have been no trading on such
date or if the Class A Common Stock is not so designated, the reported closing
bid price of the Class A Common Stock, on such date as shown by the Nasdaq
National Market or other over-the-counter market and reported by any member firm
of the New York Stock Exchange selected by the Corporation; or (d) if none of
(a), (b) or (c) is applicable, a market price per share determined at the
Corporation's expense by a nationally recognized appraiser chosen by the holders
of a majority of the shares of Participating Preferred Stock and approved by the
Corporation, which approval shall not be unreasonably withheld. If no such
appraiser is chosen more than 20 Business Days after notice of the necessity of
such calculation shall have been delivered by the Corporation to the holders of
Participating Preferred Stock, then the appraiser shall be chosen by the
Corporation.
(i) "Modified Market Price" shall mean, per share of
Class A Common Stock, on any date specified herein: (a) the closing price per
share of the Class A Common Stock on such date published in The Wall Street
Journal or, if no such closing price on such date is published in The Wall
Street Journal, the closing asked price on such date, as officially reported on
the principal national securities exchange on which the Class A Common Stock is
then listed or admitted to trading; or (b) if the Class A Common Stock is not
then listed or admitted to trading on any national securities exchange but is
designated as a national market system security by the NASD, the last trading
price of the Class A Common Stock on such date; or (c) if there shall have been
no trading on such date or if the Class A Common Stock is not so designated, the
reported closing asked price of the Class A Common Stock on such date as shown
by the Nasdaq National Market or other over-the-counter market and reported by
any member firm of the New York Stock Exchange selected by the Corporation; or
(d) if none of (a), (b) or (c) is applicable, a market price per share
determined at the Corporation's expense by a nationally recognized appraiser
chosen by the holders of a majority of the shares of Participating Preferred
Stock and approved by the Corporation, which approval shall not be unreasonably
withheld. If no such appraiser is chosen more than 20 Business Days after notice
of the necessity of such calculation shall have been delivered by the
Corporation to the holders of Participating Preferred Stock, then the appraiser
shall be chosen by the Corporation.
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Page 39 of 45 Pages
(j) "NASD" shall mean the National Association of
Securities Dealers, Inc.
(k) "Person" shall mean any individual, firm,
corporation, partnership, limited liability company or partnership, trust,
incorporated or unincorporated association, joint venture, joint stock company,
government (or any agency or political subdivision thereof) or other entity of
any kind, and shall include any successor (by merger or otherwise) of such
entity.
(l) "Pro Rata Repurchase" shall mean any purchase of
shares of Class A Common Stock or Class B Common Stock by the Corporation or by
any of its subsidiaries whether for cash, shares of capital stock of the
Corporation, other securities of the Corporation, evidences of indebtedness of
the Corporation or any other Person or any other property (including, without
limitation, shares of capital stock, other securities or evidences of
indebtedness of a subsidiary of the Corporation), or any combination thereof,
effected while any of the shares of Participating Preferred Stock are
outstanding, which purchase is subject to Section 13(e) of the Exchange Act or
is made pursuant to an offer made available to all holders of Class A Common
Stock or Class B Common Stock.
SEVENTH: The certificate of incorporation of the Corporation is hereby amended
to require unanimous approval of the Corporation's Board of Directors for
certain major corporate actions.
To accomplish this, the following new Article 10 hereby is added to the
certificate of incorporation:
10. Until such time as the Investors and any permitted assignees under
the Shareholders Agreement shall own, in the aggregate, 15% or less of
the outstanding Class A Common Stock (assuming conversion of all shares
of Participating Preferred Stock into Class A Common Stock):
(a) All of the directors of the Corporation shall be present at any
meeting of the directors in order to constitute a quorum for the transaction of
any Major Corporate Actions (as defined in subparagraph (b)) below; and
(b) Each of the following actions (the "Major Corporate Actions") shall
require the unanimous approval of all of the Corporation's directors voting
thereon (excluding directors who abstain from voting):
(i) any amendment or modification of the Corporation's
Restated Certificate of Incorporation, as amended, or ByLaws;
(ii) any merger, consolidation, amalgamation, recapitalization
or other form of business combination (other that any acquisition that
would be permitted under paragraph (d) below) involving the Corporation
or any subsidiary of the Corporation;
<PAGE>
Page 40 of 45 Pages
(iii) any sale, conveyance, lease, transfer or other
disposition of all or substantially all of the assets of the
Corporation;
(iv) any single acquisition or disposition or series of
related acquisitions or disposition of assets, including stock (whether
by purchase, merger or otherwise), in the Principal Line of Business
(as hereinafter defined) of the Corporation involving gross
consideration in excess of $15 million;
(v) any change in the line of business (food processing,
packaging, distribution and canning of fruits and vegetables and other
business operations complementary or incidental thereto) of the
Corporation and its subsidiaries (the "Principal Line of Business"),
whether by acquisition of assets or otherwise; provided, that the
Corporation and its subsidiaries may change or dispose of any existing
business or acquire any business that, in each case, is not within
their Principal Line of Business, if the consolidated net sales from
all such business engaged in (or proposed to be engaged in) by the
Corporation and its subsidiaries do not exceed in the aggregate 2% of
the consolidated net sales of the Corporation and its subsidiaries
(determined by reference to the latest annual or quarterly period in
the latest available consolidated financial statements of the
Corporation and any business proposed to be acquired);
(vi) any issuance of or agreement to issue, or any repurchase,
redemption or other acquisition or agreement to repurchase, redeem or
otherwise acquire, any shares of capital stock of the Corporation or
any of its subsidiaries or rights of any kind convertible into or
exercisable or exchangeable for, any shares of capital stock of the
Corporation or any of its subsidiaries, or any option, warrant or other
subscription or purchase right with respect to shares of capital stock
except for (i) any stock buybacks not to exceed $100,000 in any one
transaction or $1 million in the aggregate and (ii) any issuances of
shares of Class A Common Stock pursuant to the terms of Seneca Foods
Corporation Employees' Savings Plan in effect on the date hereof;
(vii) any change in the Corporation's certified public
accountants from Deloitte & Touche LLP, or any successor of Deloitte &
Touche LLP;
(viii) the settlement of any litigation to which the
Corporation or any of its subsidiaries is a party involving the payment
by the Corporation or its subsidiaries of an aggregate amount greater
than 5% of the Corporation's Adjusted Tangible Net Worth, or involving
the consent to any injunctive or similar relief; and
(ix) the commencement by the Corporation or any of its
subsidiaries of proceedings under any existing or future law of any
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Page 41 of 45 Pages
jurisdiction, domestic or foreign, relating to bankruptcy, insolvency,
reorganization or relief of debtors, seeking to have an order for
relief entered with respect to it, or seeking to adjudicate it a
bankrupt or insolvent, or seeking reorganization, arrangement,
adjustment, winding-up, liquidation, dissolution, composition or other
relief with respect to it or its debts, or seeking appointment of a
receiver, trustee, custodian, conservator or other similar official for
it or for all or any substantial part of its assets, or the making by
the Corporation or any of its subsidiaries of a general assignment for
the benefit of its creditors.
To the extent that the above-referenced Board approval is not obtained with
respect to any Major Corporate Action, the Corporation may not take or perform
such Major Corporate Action. For purposes of paragraph (h) above, the
Corporation's "Adjusted Tangible Net Worth" shall mean (i) the net book value
(after deducting related depreciation, obsolescence, amortization, valuation and
other proper reserves, which reserves will be determined in accordance with
generally accepted accounting principles) at which the assets of the Corporation
and its subsidiaries on a consolidated basis (except (w) patents, copyrights,
trademarks, trade names, franchises, goodwill and other similar intangibles, (x)
unamortized debt discount and expense, (y) accounts, notes and other receivables
due from any person directly or indirectly controlling, controlled by or under
common control with the Corporation, and (z) write-ups in the book value of any
fixed asset resulting from a revaluation thereof effective after June 22, 1998)
are shown on the latest available consolidated balance sheet of the Corporation
on such date minus (ii) the amount at which the liabilities of the Corporation
and its subsidiaries are shown on such consolidated balance sheet (including as
liabilities all reserves for contingencies and other potential liabilities as
shown on such consolidated balance sheet).
EIGHTH: The manner in which shares of the Corporation shall be changed hereby
upon the filing of this certificate by the Department of State is as follows:
Shares Changed Hereby Shares Resulting From Change
Class A Common Stock with a par value Class A Common Stock with a par value
of $0.25 per share: of $0.25 per share:
3,143,125 issued shares 3,143,125 issued shares
6,856,875 unissued shares 16,856,875 unissued shares
Preferred Stock with $.025 par value Preferred Stock with $.025 par value
per share, Class A: per share, Class A:
807,240 issued shares 807,240 issued shares
3,192,760 unissued shares 7,392,760 unissued shares
NINTH: The foregoing amendments of the certificate of incorporation were
authorized at a meeting of the Board of Directors, followed by the votes cast in
person or by proxy of the holders of record of a majority of the votes cast in
favor of or against
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Page 42 of 45 Pages
such action at an annual shareholders meeting of the Corporation by the
shareholders entitled to vote thereon.
IN WITNESS WHEREOF, the undersigned have caused this Certificate of
Amendment to be executed this 7th day of August 1998, and affirm that the
statements made herein are true under penalty of perjury.
SENECA FOODS CORPORATION
By: /s/ Kraig H. Kayser
-----------------------
Name: Kraig H. Kayser
Title: President
By: /s/ Jeffrey L. Van Riper
----------------------------
Name: Jeffrey L. Van Riper
Title: Secretary
Page 43 of 45 Pages
Exhibit 2
Agreement Relating to Joint Filing
of Statement on Schedule 13D
----------------------------------
This will confirm the agreement by and between the undersigned that the
Statement on Schedule 13D (the "Statement") filed on or about this date with
respect to the beneficial ownership by the undersigned of shares of Class A
common stock, $0.25 par value per share, and shares of Class B common stock,
$0.25 par value per share, each of Seneca Foods Corporation, a New York
corporation, is being filed on behalf of the undersigned.
Each of the undersigned hereby acknowledges that pursuant to Rule
13d-1(f) promulgated under the Securities Exchange Act of 1934, as amended, that
each person on whose behalf the Statement is filed is responsible for the timely
filing of such statement and any amendments thereto, and for the completeness
and accuracy of the information concerning such person contained therein; and
that such person is not responsible for the completeness or accuracy of the
information concerning the other persons making the filing, unless such person
knows or has reason to believe that such information is inaccurate.
This Agreement may be executed in one or more counterparts by each of
the undersigned, and each of which, taken together, shall constitute one and the
same instrument.
Date: September 9, 1998
CARL MARKS STRATEGIC INVESTMENTS, L.P.
By: Carl Marks Management Company, L.P.,
its general partner
By: /s/ Andrew M. Boas
----------------------
Name: Andrew M. Boas
Title: General Partner
CARL MARKS STRATEGIC INVESTMENTS II, L.P.
By: Carl Marks Management Company, L.P.,
its general partner
By: /s/ Andrew M. Boas
----------------------
Name: Andrew M. Boas
Title: General Partner
<PAGE>
Page 44 of 45 Pages
URANUS FUND, LTD.
By: Carl Marks Offshore Management, Inc.,
its Investment Manager
By: /s/ Andrew M. Boas
----------------------
Name: Andrew M. Boas
Title: President
CARL MARKS MANAGEMENT COMPANY, L.P.
By: /s/ Andrew M. Boas
----------------------
Name: Andrew M. Boas
Title: General Partner
CARL MARKS OFFSHORE MANAGEMENT, INC.
By: /s/ Andrew M. Boas
----------------------
Name: Andrew M. Boas
Title: President
/s/ Andrew M. Boas
------------------
Andrew M. Boas
/s/ Robert C. Ruocco
--------------------
Robert C. Ruocco
<PAGE>
Page 45 of 45 Pages
CMCO, INC.
By: /s/ Mark Claster
--------------------
Name: Mark Claster
Title: Managing Director
/s/ Edwin S. Marks
------------------
Edwin S. Marks
