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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549-1004
FORM 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 1999
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from ----to----
COMMISSION FILE NUMBER 1-11846
AptarGroup, Inc.
(Exact Name of Registrant as Specified in its Charter)
DELAWARE 36-3853103
-------- ----------
(State of Incorporation) (I.R.S. Employer Identification No.)
475 West Terra Cotta Avenue, Suite E, Crystal Lake, Illinois 60014
- ------------------------------------------------------------ ------
(Address of Principal Executive Offices) (Zip Code)
815-477-0424
------------
(Registrant's Telephone Number, Including Area Code)
Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
Registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.
Yes X No____
-----
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date (August 6, 1999)
Common Stock 36,437,625
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AptarGroup, Inc.
FORM 10-Q
QUARTER ENDED JUNE 30, 1999
INDEX
<TABLE>
<CAPTION>
PART I. FINANCIAL INFORMATION Page
----
<S> <C>
ITEM 1. Financial statements (Unaudited)
Consolidated Statements of Income -
Three and Six Months Ended June 30, 1999
and 1998 3
Consolidated Balance Sheets -
June 30, 1999 and December 31, 1998 4
Consolidated Statements of Cash Flows -
Six Months Ended June 30, 1999 and 1998 6
Notes to Consolidated Financial Statements 7
ITEM 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations 10
ITEM 3. Quantitative and Qualitative Disclosures about
Market Risk 16
PART II. OTHER INFORMATION
ITEM 2. Changes in Securities and Use of Proceeds 17
ITEM 4. Submission of Matters to a Vote of
Security Holders 17
ITEM 6. Exhibits and Reports on Form 8-K 18
SIGNATURE 19
</TABLE>
<PAGE>
AptarGroup, Inc.
Consolidated Statements of Income
(Dollars in Thousands, Except Per Share Data)
(Unaudited)
<TABLE>
<CAPTION>
Three Months Six Months
Ended June 30, Ended June 30,
--------------------------- -----------------------
1999 1998 1999 1998
------------ ------------ ---------- ----------
<S> <C> <C> <C> <C>
Net Sales............................................. $ 208,860 $ 181,752 $ 407,087 $ 352,694
Operating Expenses:
Cost of sales....................................... 129,890 113,778 253,975 220,487
Selling, research & development
and administrative................................. 33,484 29,801 66,368 58,002
Depreciation and amortization....................... 17,143 13,353 34,165 26,921
------------ ------------ ---------- ----------
180,517 156,932 354,508 305,410
------------ ------------ ---------- ----------
Operating Income...................................... 28,343 24,820 52,579 47,284
------------ ------------ ---------- ----------
Other Income (Expense):
Interest expense.................................... (3,792) (1,684) (6,412) (3,090)
Interest income..................................... 411 253 621 528
Equity in results of affiliates..................... (288) 135 (548) 318
Minority interests.................................. (65) (125) (31) (209)
Miscellaneous, net.................................. 359 (322) 882 324
Lawsuit settlement, net............................. 0 815 0 815
------------ ------------ ---------- ----------
(3,375) (928) (5,488) (1,314)
------------ ------------ ---------- ----------
Income Before Income Taxes............................ 24,968 23,892 47,091 45,970
Provision for Income Taxes............................ 8,788 9,628 16,642 18,525
------------ ------------ ---------- ----------
Net Income............................................ $ 16,180 $ 14,264 $ 30,449 $ 27,445
============ ============ ========== ==========
Net Income Per Common Share:
Basic.............................................. $ .45 $ .40 $ .84 $ .76
============ ============ ========== ==========
Diluted............................................ $ .44 $ .39 $ .82 $ .75
============ ============ ========== ==========
Average Number of Shares Outstanding (in thousands):
Basic.............................................. 36,344 36,024 36,267 36,008
Diluted............................................ 37,026 36,852 36,921 36,794
</TABLE>
See accompanying notes to consolidated financial statements.
3
<PAGE>
AptarGroup, Inc.
Consolidated Balance Sheets
(Dollars in Thousands)
<TABLE>
<CAPTION>
(Unaudited)
June 30, December 31,
1999 1998
----------- --------------
<S> <C> <C>
Assets
Current Assets:
Cash and equivalents........................................ $ 32,631 $ 25,159
Accounts and notes receivable, less allowance for doubtful
accounts of $6,051 in 1999 and $4,367 in 1998............ 181,399 173,289
Inventories................................................. 104,902 101,091
Prepayments and other....................................... 25,136 17,110
----------- ------------
344,068 316,649
----------- ------------
Property, Plant and Equipment:
Buildings and improvements.................................. 93,665 90,768
Machinery and equipment..................................... 588,101 565,460
----------- ------------
681,766 656,228
Less: Accumulated depreciation.............................. (342,964) (335,650)
----------- ------------
338,802 320,578
Land........................................................ 4,235 4,601
----------- ------------
343,037 325,179
----------- ------------
Other Assets:
Investments in affiliates................................... 3,516 3,217
Goodwill, less accumulated amortization of $8,355 in
1999 and $6,586 in 1998.................................. 124,098 49,689
Miscellaneous............................................... 16,999 19,939
----------- ------------
144,613 72,845
----------- ------------
Total Assets $ 831,718 $ 714,673
=========== ============
</TABLE>
See accompanying notes to consolidated financial statements.
4
<PAGE>
AptarGroup, Inc.
Consolidated Balance Sheets
(Dollars in Thousands)
<TABLE>
<CAPTION>
(Unaudited)
June 30, December 31,
Liabilities and Stockholder's Equity 1999 1998
----------- ------------
<S> <C> <C>
Current Liabilities:
Notes payable................................ $ 15,560 $ 29,663
Current maturities of long-term obligations.. 8,605 7,561
Accounts payable and accrued liabilities..... 125,155 130,209
----------- ------------
149,320 167,433
----------- ------------
Long-Term Obligations.......................... 226,842 80,875
----------- ------------
Deferred Liabilities and Other:
Deferred income taxes........................ 22,002 24,989
Retirement and deferred compensation plans... 13,847 14,957
Minority interests........................... 4,071 4,189
Deferred and other non-current liabilities... 4,870 6,722
----------- ------------
44,790 50,857
----------- ------------
Stockholders' Equity:
Common stock, $.01 par value................. 399 361
Capital in excess of par value............... 111,305 105,714
Retained earnings............................ 357,138 329,582
Accumulated other comprehensive income....... (58,076) (20,149)
----------- ------------
410,766 415,508
----------- ------------
Total Liabilities and Stockholders' Equity $ 831,718 $ 714,673
=========== ============
</TABLE>
See accompanying notes to consolidated financial statements.
5
<PAGE>
AptarGroup, Inc.
Consolidated Statements of Cash Flows
For the Six Months Ended June 30, 1999 and 1998
(Dollars in Thousands, brackets denote cash outflows)
(Unaudited)
<TABLE>
<CAPTION>
Six Months Ended June 30,
Cash Flows From Operating Activities: 1999 1998
---- ----
<S> <C> <C>
Net income............................................... $ 30,449 $ 27,445
Adjustments to reconcile net income
to net cash provided by operations:
Depreciation............................................. 32,291 25,684
Amortization............................................. 1,874 1,237
Provision for bad debts.................................. 492 638
Minority interests....................................... 31 209
Deferred income taxes.................................... 636 (390)
Retirement and deferred compensation plans............... (672) (193)
Equity in result of affiliates in
excess of cash distributions received................. 548 (318)
Changes in balance sheet items,
excluding effects from foreign currency adjustments:
Accounts receivable...................................... (512) (18,341)
Inventories.............................................. (1,652) (5,314)
Prepaid and other current assets......................... (3,434) (2,850)
Accounts payable and accrued liabilities................. 1,763 8,385
Other changes, net....................................... 4,440 (2,751)
------------- -----------
Net cash provided by operations.......................... 66,254 33,441
------------- -----------
Cash Flows From Investing Activities:
Capital expenditures..................................... (48,689) (29,948)
Disposition of property and equipment.................... 1,579 89
Acquisition of businesses................................ (123,575) (7,181)
Collections (proceeds) of notes receivable, net.......... 27 (48)
Investments in affiliates................................ (1,000) (800)
------------- -----------
Net cash used by investing activities.................... (171,658) (37,888)
------------- -----------
Cash Flows From Financing Activities:
(Decrease) increase in notes payable..................... (12,761) 13,233
Proceeds from long-term obligations...................... 162,642 9,297
Repayments of long-term obligations...................... (33,647) (6,906)
Dividends paid........................................... (2,892) (2,880)
Proceeds from stock options exercised.................... 2,032 517
------------- -----------
Net cash provided by financing activities................ 115,374 13,261
------------- -----------
Effect of Exchange Rate Changes on Cash.................... (2,498) (200)
------------- -----------
Net Increase in Cash and Equivalents....................... 7,472 8,614
Cash and Equivalents at Beginning of Period................ 25,159 17,717
------------- -----------
Cash and Equivalents at End of Period...................... $ 32,631 $ 26,331
============= ===========
</TABLE>
See accompanying notes to consolidated financial statements.
6
<PAGE>
AptarGroup, Inc.
Notes To Consolidated Financial Statements
(Dollars in Thousands, Except Per Share Data)
(Unaudited)
Note 1 - Basis of Presentation
The accompanying unaudited consolidated financial statements included the
accounts of AptarGroup, Inc. and its subsidiaries. The terms "AptarGroup" or
"Company" as used herein refer to AptarGroup, Inc. and its subsidiaries.
In the opinion of management, the unaudited consolidated financial statements
include all adjustments, consisting of only normal recurring adjustments,
necessary for a fair presentation of consolidated financial position and
results of operations for the interim periods presented. The accompanying
unaudited consolidated financial statements have been prepared by the Company,
without audit, pursuant to the rules and regulations of the Securities and
Exchange Commission. Certain information and footnote disclosure normally
included in financial statements prepared in accordance with generally accepted
accounting principles (GAAP) have been condensed or omitted pursuant to such
rules and regulations, although the Company believes that the disclosures made
are adequate to make the information presented not misleading. Accordingly,
these unaudited financial statements and related notes should be read in
conjunction with the consolidated financial statements and notes thereto
included in the Company's Annual Report to Shareholders incorporated by
reference into the Company's Annual Report on Form 10-K for the year ended
December 31, 1998. The results of operations of any interim period are not
necessarily indicative of the results that may be expected for a fiscal year.
In August 1998, the Company effected a two-for-one stock split. Previously
reported information has been restated to reflect the stock split.
Note 2 - Acquisitions
In the second and third quarters of 1998, the Company acquired controlling
interests in two companies for approximately $15 million in cash, and 50,000
shares of the Company's common stock (valued at approximately $1.5 million).
The excess purchase price over the fair value of the net assets acquired
(goodwill) in these acquisitions was approximately $8 million and is being
amortized on a straight-line basis over 40 years. These acquisitions are in
companies that manufacture and distribute products similar to the Company's
products.
On February 17, 1999, the Company acquired Emson Research, Inc. and related
companies (Emson) for approximately $123 million in cash and 148,371 shares of
the Company's common stock (valued at approximately $4 million). Approximately
$23 million of debt was assumed in the transaction. This acquisition was
initially funded through short-term borrowings. The Company incurred long-term
obligations in the second quarter of 1999 to replace most of the short-term
borrowings associated with the acquisition. Emson is a leading supplier of
perfume pumps in the North American market and also maintains a significant
position in the North American personal care and food pump markets. The excess
purchase price over the fair value of
7
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the net assets acquired (goodwill) in these acquisitions was approximately $80
million and is being amortized on a straight-line basis over 40 years.
The acquisitions described above were accounted for by the purchase method of
accounting for business combinations. Accordingly, the accompanying
consolidated statements of income do not include any revenues or expenses
related to these acquisitions prior to their respective closing dates.
Following are the Company's unaudited pro forma results for the first quarter
of 1998 and 1999 assuming the acquisitions occurred on January 1, 1998 (in
thousands, except for per share data):
<TABLE>
<CAPTION>
Three Months Ended June 30, Six Months Ended June 30,
--------------------------- -------------------------
1999 1998 1999 1998
- -----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Net Sales $208,860 $215,818 $415,121 $421,077
Net Income $ 16,180 $ 15,150 $ 29,621 $ 28,478
Net Earnings per common share:
Basic $ 0.45 $ 0.41 $ 0.81 $ 0.79
Diluted $ 0.44 $ 0.40 $ 0.80 $ 0.77
Weighted average shares outstanding:
Basic 36,344 36,194 36,348 36,178
Diluted 37,026 37,022 37,002 36,964
</TABLE>
These unaudited pro forma results have been prepared for comparative purposes
only and may not be indicative of the results of operations which would have
actually resulted had the combinations been in effect on January 1, 1998, or of
future periods.
Note 3 - Inventories
At June 30, 1999 and December 31, 1998, inventories, by component, consisted of:
<TABLE>
<CAPTION>
June 30, December 31,
1999 1998
----------- ------------
<S> <C> <C>
Raw Materials $ 40,293 $ 35,493
Work in progress 27,561 29,441
Finished goods 37,048 36,157
----------- ------------
Total $ 104,902 $ 101,091
=========== ============
</TABLE>
Inventories are stated at cost, which is lower than market. Costs included in
inventories are raw materials, direct labor and manufacturing overhead. The
cost of two domestic inventories and the inventories of two foreign operations
are determined by using the last-in, first-out ("LIFO") method, while the
remaining inventories are valued using the first-in, first-out (FIFO) method.
The LIFO reserve was not material at either June 30, 1999 or December 31, 1998.
8
<PAGE>
Note 4 - Long-Term Debt
On May 15, 1999 the Company entered into a $107 million, twelve-year private
debt placement agreement. The private placement is comprised of $107 million
of 6.62% senior unsecured notes. The notes will be repaid in equal annual
installments of $21.4 million beginning on May 30, 2007 and ending on May 30,
2011.
The Company entered into a new multi-year, multi-currency unsecured revolving
credit agreement on June 30, 1999 allowing borrowings of up to $75 million.
Under this credit agreement, interest on borrowings is payable at a rate equal
to the London Interbank Offered Rate (LIBOR) plus an amount based on the
financial condition of the Company. At June 30, 1999, the amount unused and
available under this agreement was $20 million. The Company is required to pay
a fee for the unused portion of the commitment. The agreement expires on June
30, 2004. The credit available under the revolving credit agreement provides
management with the ability to refinance certain short-term obligations on a
long-term basis. As it is management's intent to do so, an additional $20
million of short-term obligations representing the unused and available amount
under the new credit agreement have been reclassified as long-term obligations
as of June 30, 1999. Short-term obligations of $25 million were reclassified
as long-term obligations as of December 31, 1998 under a previous revolving
credit agreement.
The revolving credit agreement and private placement agreements contain
covenants that include certain financial tests, including minimum interest
coverage, net worth and maximum borrowings.
Note 5 - Comprehensive Income
AptarGroup's total comprehensive income was as follows:
<TABLE>
<CAPTION>
Three months ended June 30 Six months ended June 30
--------------------------- -------------------------
1999 1998 1999 1998
------------ ------------ ----------- -----------
<S> <C> <C> <C> <C>
Net income $ 16,180 $14,264 $ 30,449 $27,445
Add/(Subtract): foreign currency
translation adjustment (10,881) 5,257 (37,927) (4,035)
------------ ------------ ----------- -----------
Total comprehensive income (loss) $ 5,299 $19,521 $ (7,478) $23,410
============ ============ =========== ===========
</TABLE>
9
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Results of Operations
Net sales for the quarter and six months ended June 30, 1999 totaled $208.9
million and $407.1 million, respectively, increases of approximately 15% when
compared to the corresponding periods of 1998. The stronger U.S. dollar
relative to the same three-month period of 1998 negatively affected the
translation of AptarGroup's foreign sales. If the dollar exchange rate had been
constant, sales for the three months ended June 30, 1999 would have increased
approximately 17%. The impact of changes in the U.S. dollar exchange rate on
sales for the six months ended June 30, 1999 was insignificant. Acquisitions
completed in the second and third quarters of 1998 and the first quarter of
1999 accounted for $32 million and $55 million of the increase for the three
and six months ended June 30, 1999 respectively. Softness in demand from the
fragrance/cosmetic market and the implementation of a major enterprise software
system at a domestic operation adversely affected the sales compared to the
same periods in the prior year. Sales were positively impacted by increased
sales to the pharmaceutical, personal care and food markets when compared to
the same periods in the prior year.
Sales to unaffiliated customers by European operations represented
approximately 54% and 56% of net sales for the quarter and six months ended
June 30, 1999, respectively, compared to 54% and 55% for the same periods a
year ago. Sales to unaffiliated customers by U.S. operations represented 40%
and 39% of net sales for the quarter and six months ended June 30, 1999,
respectively, compared to 41% and 40% for the same periods a year ago. Sales to
unaffiliated customers by other foreign operations represented 6% and 5% of net
sales for the quarter and six months ended June 30, 1999, respectively,
compared to 5% for the same periods a year ago.
Cost of sales as a percent of net sales decreased slightly to 62.2% in the
second quarter of 1999 compared to 62.6% in the same period a year ago. For the
first six months of 1999, cost of sales as a percent of net sales decreased
slightly to 62.4% compared to 62.5% in the same period a year ago. The decrease
for the quarter and six months ended June 30, 1999 is primarily attributed to
the mix of products sold.
Selling, research & development and general and administrative expenses (SG&A)
increased 12.4% or $3.7 million to $33.5 million in the second quarter of 1999
compared to $29.8 million in the same period a year ago. The entire increase in
SG&A is related to acquisitions completed in the second and third quarters of
1998 and the first quarter of 1999. As a percent of net sales, SG&A decreased
to 16.0% in the second quarter of 1999 compared to 16.4% in the same period a
year ago. SG&A for the six months ended June 30, 1999 increased 14.4% or $8.4
million to $66.4 million compared to $58.0 million a year ago. Approximately
$5.9 million of the increase is due to the acquisitions mentioned above. The
remainder of the increase is primarily due to additional information technology
expenses related to the Company's year 2000 readiness program and to the
implementation of new enterprise software systems at two major operations. As a
percent of net sales, SG&A decreased slightly in the first six months of 1999
to 16.3% compared to 16.4% a year ago.
10
<PAGE>
European operations represented 72% and 70% of operating income in the second
quarter and year to date of 1999, respectively, as compared to 74% and 75% in
the same periods a year ago. U.S. operations represented 37% and 40% of
operating income in the second quarter and year to date of 1999, respectively,
as compared to 37% in the corresponding periods of 1998. The difference
between Europe and U.S. operations to total operating income is due to
operating income from other foreign operations, corporate expenses and inter-
geographic eliminations.
Interest expense increased $2.1 million and $3.3 million for the second quarter
and six months ended June 30, 1999, respectively, as compared to the same
periods a year ago due primarily to the additional debt related to the
acquisitions completed in the second and third quarters of 1998 and the first
quarter of 1999.
The effective tax rate for the second quarter and six months ended June 30,
1999 was 35.2% compared to 40.3% for the same period a year ago. The decrease
is due to a reduction in the French and German corporate tax rates, the mix of
income earned in different foreign tax jurisdictions combined with the ongoing
rationalization of tax rates. The Company expects the effective tax rate for
1999 to be in the range of 35%- 36%.
Net income for the second quarter increased 13% to $16.2 million compared to
$14.3 million in the second quarter of 1998. Net income for the six months
ended June 30, 1999 increased 11% to $30.4 million as compared to $27.4 million
in the same period a year ago.
Quarterly Trends
AptarGroup's results of operations in the second half of the year typically
have been negatively impacted by European summer holidays and customer plant
shutdowns in December. In the future, AptarGroup's results of operations in a
quarterly period could be impacted by factors such as changes in product mix,
changes in material costs, changes in growth rates in the industries to which
AptarGroup's products are sold or changes in general economic conditions in any
of the countries in which AptarGroup does business, and year 2000 concerns from
customers.
Foreign Currency
A significant portion of AptarGroup's operations are located outside the United
States. Because of this, movements in exchange rates may have a significant
impact on the translation of the financial condition and results of operations
of AptarGroup's foreign entities. In general, since the majority of the
Company's operations are based in Europe - primarily France, Germany and Italy
- a strengthening U.S. dollar relative to the major European currencies has a
dilutive translation effect on the Company's financial condition and results of
operations. Conversely, a weakening U.S. dollar would have an additive effect.
Additionally, in some cases, the Company sells products denominated in a
currency different from the currency in which the respective costs are
incurred. Changes in exchange rates on such inter-country sales impact the
Company's results of operations.
11
<PAGE>
Liquidity and Capital Resources
Historically, AptarGroup has generated positive cash flow from operations and
has utilized the majority of such cash flows to invest in capital projects. Net
cash provided by operations in the first six months of 1999 was $66.3 million
compared to $33.4 million in the same period a year ago. The increase is
primarily attributed to changes in working capital.
Total net working capital at June 30, 1999 was $194.7 million compared to
$149.2 million at December 31, 1998. The increase in net working capital is due
primarily to the acquisition of Emson made in 1999.
Management anticipates that cash outlays for capital expenditures for all of
1999 will be approximately $85 to $90 million.
Net cash used by investing activities increased to $171.7 million from $37.9
million a year ago due to the Company's purchase of Emson on February 17, 1999.
The Company paid $122.8 million in cash, approximately $4 million of the
Company's common stock and assumed approximately $23 million of debt. This
acquisition was initially funded through short-term borrowings. The Company
incurred long-term obligations in the second quarter of 1999 to replace most of
the short-term borrowings associated with the acquisition of Emson.
Net cash provided by financing activities increased to $115.4 million in the
first six months of 1999 compared to $13.3 million in 1998. The increase in net
cash provided by financing activities is due to borrowing for the acquisition
of Emson mentioned above. The ratio of net debt to total net capitalization was
34.7% and 18.3% at June 30, 1999 and December 31, 1998, respectively. Net debt
is defined as debt less cash and cash equivalents and total net capitalization
is defined as stockholder's equity plus net debt.
On May 15, 1999 the Company entered into a $107 million, twelve-year private
debt placement agreement. The private placement is comprised of $107 million of
6.62% senior unsecured notes. The notes will be repaid in equal annual
installments of $21.4 million beginning on May 30, 2007 and ending on May 30,
2011.
The Company entered into a new multi-year, multi-currency unsecured revolving
credit agreement on June 30, 1999 allowing borrowings of up to $75 million.
Under this credit agreement, interest on borrowings is payable at a rate equal
to the London Interbank Offered Rate (LIBOR) plus an amount based on the
financial condition of the Company. At June 30, 1999, the amount unused and
available under this agreement was $20 million. The Company is required to pay
a fee for the unused portion of the commitment. The agreement expires on June
30, 2004. The credit available under the revolving credit agreement provides
management with the ability to refinance certain short-term obligations on a
long-term basis. As it is management's intent to do so, an additional $20
million of short-term obligations representing the unused and available amount
under the new credit agreement have been reclassified as long-term obligations
as of June 30, 1999. Short-term obligations of $25 million were reclassified as
long-term obligations as of December 31, 1998 under a previous revolving credit
agreement.
12
<PAGE>
The revolving credit agreement and private placement agreements contain
covenants that include certain financial tests, such as minimum interest
coverage, net worth and maximum borrowings.
On July 22, 1999, the Board of Directors declared a quarterly dividend of $.05
per share payable on August 24, 1999 to shareholders of record as of August 3,
1999. This dividend represents a 25% increase over the prior dividend rate.
Year 2000
As many computer systems and other equipment with embedded chips or processors
(collectively, "Enterprise Systems") use only two digits to represent the year,
they may be unable to process accurately certain data before, during or after
the year 2000. This is commonly known as the Year 2000 ("Y2K") issue. The Y2K
issue can arise at any point in an entity's supply, manufacturing, processing,
distribution, and financial chains.
The Company has implemented a Y2K readiness program with the objective of
having all of the significant Enterprise Systems, including those that affect
facilities and manufacturing activities, functioning properly with respect to
the Y2K issue before January 1, 2000. The Company has established standardized
planning, assessment and progress documentation as well as set critical
deadlines that apply to all significant subsidiaries.
In order to address the Y2K issue, the Company has developed and implemented a
five-phase readiness program which is comprised of 1) planning, 2) assessment,
3) renovation/replacement, 4) testing/validation, and 5) contingency planning.
The Company has substantially completed phases one through three of the
program. Currently, the Company is in the process of completing phase four,
the testing/validation phase of the program, the majority of which was
completed by the end of the second quarter of 1999. Though certain systems may
require additional modifications throughout 1999, the Company believes that
these systems will be Y2K ready by the end of 1999. Concurrently with
completing phase four, the Company is in the process of completing phase five,
contingency planning. The Company is developing contingency plans intended to
mitigate the possible disruption in business operations that may result from
the Y2K issue, and is developing cost estimates for such plans. Once developed,
contingency plans and related cost estimates will be continually refined, as
additional information becomes available. Contingency plans may include
increasing inventory levels, securing alternate sources of supply, adjusting
facility shutdown and start-up schedules and other appropriate measures.
The different phases of the program address the potential Y2K risk that could
be found in the following five functional areas: 1) business applications
(hardware and software), 2) production equipment, 3) facility systems, 4)
communication infrastructure and 5) vendor/customer management.
Although the Company has a significant number of key business partners,
including suppliers and customers, the Company does not currently anticipate
any material disruption in its business due to supplier or customer Y2K issues.
More specifically, the Company, through
13
<PAGE>
the current stage of its Y2K program, has not received any information that
would lead it to believe that any significant supplier or customer will suffer
business interruption due to Y2K issues to a degree that would materially
affect the Company's ability to conduct business.
The current estimated costs of the project are based on management's estimates,
which were derived utilizing numerous assumptions of future events including
the continued availability of certain resources, third party modification plans
and other factors. However, there can be no guarantee that these estimates will
be achieved and actual results could differ significantly from those planned.
Based on management's current estimations, the projected costs of the Company's
Y2K readiness program are expected to total $3.5 million.
Although the Company expects its critical Enterprise Systems to be Y2K ready by
the end of 1999, there is no guarantee that these results will be achieved.
Specific factors that give rise to this uncertainty include a possible loss of
technical resources to perform the work, failure to identify all susceptible
systems, non-compliance by third parties whose systems and operations impact
the Company, and other similar uncertainties. A reasonably possible worst case
scenario might include one or more of the Company's significant production
facilities incurring interruption in business either from internal systems
failures or failure to perform on the part of third parties, including
suppliers. Such an event could result in a material disruption to the Company's
operations. Specifically, the Company could experience an interruption in its
ability to produce certain products, collect and process orders, process
payments, manage inventory and perform adequate customer service. Should the
worst case scenario occur it could, depending on its duration, have a material
adverse impact on the Company's results of operations and financial position,
but that impact can not be estimated.
Forward-Looking Statements
In addition to the historical information presented in this quarterly report,
the Company has made and will make certain forward-looking statements in this
report, other reports filed by the Company with the Securities and Exchange
Commission, reports to stockholders and in certain other contexts relating to
future net sales, costs of sales, other expenses, profitability, financial
resources, products and production schedules. Statements relating to the
foregoing or that predict or indicate future events and trends and which do no
relate solely to historical matters identify forward-looking statements.
Forward-looking statements are made pursuant to the safe harbor provisions of
Section 27A of the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934 and are based on management's beliefs as well as
assumptions made by and information currently available to management.
Accordingly, the Company's actual results may differ materially from those
expressed or implied in such forward-looking statements due to known and
unknown risks and uncertainties that exist in the Company's operations and
business environment, including, among other factors, government regulation
including tax rate policies, competition and technological change, intellectual
property rights, the failure by the Company to produce anticipated cost savings
or improve productivity, the failure by the Company or its suppliers or
customers to achieve Y2K compliance, the timing and magnitude of capital
expenditures and acquisitions, currency exchange rates, economic and market
conditions in the United States, Europe and the rest of the world, changes in
customer spending levels, the demand for existing and new products, the cost
and availability of raw materials, the successful integration of the Company's
14
<PAGE>
acquisitions, and other risks associated with the Company's operations.
Although the Company believes that its forward-looking statements are based on
reasonable assumptions, there can be no assurance that actual results,
performance or achievements will not differ materially from any future results,
performance or achievements expressed or implied by such forward-looking
statements. Readers are cautioned not to place undue reliance on forward-
looking statements.
Adoption of New Accounting Standards
In June 1998, the Financial Accounting Standards Board (FASB) issued Statement
of Financial Accounting Standards (SFAS) No. 133, "Accounting for Derivative
Instruments and Hedging Activities." This Statement requires that entities
recognize all derivatives as either assets or liabilities in the statement of
financial position and measure those instruments at fair value. Due to the
complexity of this new standard, the Company is still assessing the impact it
will have on the financial position or results of operations, but does not
anticipate it having a material impact on the financial statements. In June
1999, the FASB issued SFAS No. 137, which amended the effective date of SFAS
133. The new effective date for implementation of SFAS 133 is now for all
fiscal quarters of all fiscal years beginning after June 15, 2000.
15
<PAGE>
Item 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
A significant portion of AptarGroup's operations is located outside the United
States. Because of this, movements in exchange rates may have a significant
impact on the translation of the financial condition and results of operations
of AptarGroup's foreign entities. The Company's significant foreign exchange
exposures are to the major currencies which are now part of the Euro (the
Italian Lira, French Franc and German Mark). The Company manages its exposures
to foreign exchange principally with forward exchange contracts to hedge
certain firm purchase and sales commitments and intercompany cash transactions
denominated in foreign currencies.
The table below provides information as of June 30, 1999 about the Company's
forward currency exchange contracts. All the contracts expire before the end of
the third quarter of 1999.
<TABLE>
<CAPTION>
Average
Contractual
Buy/Sell Contract Amount Exchange Rate
--------------------------------------------------
<S> <C> <C>
FRF/USD $12,830 6.20
DM/USD 6,597 1.84
LIRE/USD 3,095 1,824.46
FRF/GBP 1,397 9.96
FRF/YEN 1,371 0.0521
LIRE/GBP 686 2955.16
</TABLE>
The Company is also party to certain smaller contracts to buy or sell various
other currencies (principally Japanese and Australian) that had an aggregate
contract amount of $0.3 million as of June 30, 1999.
The Company has a cross-currency interest rate swap to hedge an intercompany
lending transaction. This swap requires the Company to pay principal of 37,031
French Francs plus interest at 8% and receive principal of $7,500 plus interest
at 7.08% over ten years. If the Company canceled the swap at June 30, 1999, the
Company would have received approximately $956 based on the fair value of the
swap on that date.
The table below presents the cash flows in both foreign currency and U.S.
dollars that are expected to be exchanged over the duration of the contract.
1999 2000 2001 2002 2003 Thereafter
----------------------------------------------------------------
Pay FRF FRF 6,772 7,822 7,400 6.992 6,560 11,850
Receive USD $1,337 1,525 1,450 1,377 1,299 2,370
Additionally, in some cases, the Company sells products denominated in a
currency different from the currency for which the respective costs are
incurred. Changes in exchange rates on such inter-country sales impacts the
Company's results of operations.
16
<PAGE>
PART II - OTHER INFORMATION
ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS
During the quarter ended June 30, 1999, 180 shares of Common Stock of the
Company were sold to participants in the FCP Aptar Savings Plan, (the "Plan")
at the price of $26.18 per share. Employees of AptarGroup S.A., a subsidiary of
the Company, are eligible to participate in the Plan. All eligible participants
are located outside of the United States. An agent independent of the Company
purchases shares of Common Stock available under the Plan for cash on the open
market and the Company issues no shares. The Company does not receive any
proceeds form the purchase of Common Stock under the Plan. The agent under the
Plan is Banque Nationale de Paris. No underwriters are used under the Plan. All
shares are sold in reliance upon the exemption from registration under the
Securities Act of 1933 provided by Regulation S promulgated under that Act.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
The annual meeting of stockholders was held on May 11, 1999. A vote was taken
by ballot for the election of three directors to hold office until the 2002
Annual Meeting of Stockholders. The following nominees received the number of
votes as set forth below:
Broker
Nominee For Withhold Non-votes
------- --- -------- ---------
King Harris 28,706,456 416,666 -0-
Peter Pfeiffer 28,705,268 417,854 -0-
Joanne C. Smith 28,685,413 437,709 -0-
No votes were cast for any other nominee for director. The directors
continuing in office until the 2000 Annual Meeting are Eugene Barnett,
Ralph Gruska and Leo A. Guthart. Directors continuing in office until the
2001 Annual Meeting of Stockholders are Robert Barrows, Alfred Pilz, and
Carl A. Siebel.
A vote was also taken to approve an amendment to the Company's Certificate
of Incorporation to increase the number of authorized shares. The vote was
as set forth below:
For Against Abstain Broker Non-Votes
--- ------- ------- ----------------
21,709,412 7,376,229 37,481 -0-
No other matters were submitted to a vote by ballot at the 1999 Annual
Meeting.
17
<PAGE>
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits.
Exhibit 3 (i) Amended and Restated Certificate of Incorporation of
the Company
Exhibit 4.1 Note Purchase Agreement dated as of May 15, 1999
relating to $107 million senior unsecured notes, series
1999-A
Exhibit 4.2 Multicurrency Credit Agreement dated as of June 30,
1999 among the Company, the lenders party thereto, Bank
of America National Trust and Savings Association, as
Agent, and Bank of America Securities LLC, as Arranger
Exhibit 27 Financial Statement Schedule
(b) Reports on Form 8-K.
No reports on Form 8-K were filed for the quarter ended June 30, 1999.
18
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
AptarGroup, Inc.
(Registrant)
By /s/ Stephen J. Hagge
--------------------
Stephen J. Hagge
Executive Vice President and Chief
Financial Officer, Secretary and
Treasurer
(Duly Authorized Officer and
Principal Financial Officer)
Date: August 12, 1999
19
<PAGE>
Exhibit 3(i)
CERTIFICATE OF RESTATED
CERTIFICATE OF INCORPORATION
OF
APTARGROUP, INC.
-----------------------------------------------------------------------
Carl A. Siebel and Stephen J. Hagge, being the duly elected President
and Chief Executive Officer and Secretary, respectively, of AptarGroup, Inc., a
corporation organized and existing under and by virtue of the General
Corporation Law of the State of Delaware (the "Corporation"), do hereby certify
as follows:
1. That the Corporation filed its original Certificate of
Incorporation with the Delaware Secretary of State on September 3, 1992.
2. That in accordance with Section 245 of the General Corporation
Law of the State of Delaware, the board of directors of the Corporation duly
adopted resolutions authorizing the Corporation to integrate and restate the
Corporation's Certificate of Incorporation in its entirety to read as set forth
in Exhibit A attached hereto and made a part hereof (the "Restated
Certificate").
3. That the Restated Certificate only restates and integrates and
does not further amend the provisions of the Certificate of Incorporation of the
Corporation as heretofore amended or supplemented and there is no discrepancy
between those provisions and the provisions of this Restated Certificate.
4. The Restated Certificate shall be effective on May 11, 1999.
5. The Certificate of Designation is set forth in the attached
Exhibit B.
IN WITNESS WHEREOF, the undersigned, being the President and Chief
Executive Officer and Secretary hereinabove named, for the purpose of amending
and restating the Certificate of Incorporation of the Corporation pursuant to
the General Corporation Law of the State of Delaware, under penalties of perjury
do each hereby declare and certify that this is the act and deed of the
Corporation and the facts stated herein are true, and accordingly have hereunto
signed this Certificate of Restated Certificate of Incorporation this 11th day
of May, 1999.
/s/ Carl A. Siebel
------------------
Carl A. Siebel
President and Chief Executive Officer
[SEAL]
Attest:
/s/ Stephen J. Hagge
- --------------------
Stephen J. Hagge, Secretary
<PAGE>
AMENDED AND RESTATED CERTIFICATE OF INCORPORATION
-------------------------------------------------
OF
--
APTARGROUP, INC.
----------------
ARTICLE ONE
-----------
The name of the Corporation is AptarGroup, Inc.
ARTICLE TWO
-----------
The address of the Corporation's registered office in the State of
Delaware is 32 Loockerman Square, Suite L-100, in the City of Dover, County of
Kent, 19901. The name of its registered agent at such address is the Prentice-
Hall Corporation System, Inc.
ARTICLE THREE
-------------
The nature of the business or purposes to be conducted or promoted is
to engage in any lawful act or activity for which corporations may be organized
under the General Corporation Law of the State of Delaware.
ARTICLE FOUR
------------
4.1 Capital Stock. The total number of shares of stock which the
Corporation has authority to issue is 100,000,000 shares, consisting of
1,000,000 shares of Preferred Stock, par value $.01 per share, and 99,000,000
shares of Common Stock, par value $.01 per share. The number of authorized
shares of Preferred Stock may not be decreased unless such decrease is approved
by the affirmative vote of the holders of not less than eighty percent (80%) of
the outstanding Common Stock. Any such decrease may be effected without a vote
of the holders of the Preferred Stock, or of any series thereof, unless a vote
of any such holders is required pursuant to the certificate or certificates
establishing the series of Preferred Stock. In no event may the number of
- 2 -
<PAGE>
authorized shares of Preferred Stock be decreased below the number of shares
thereof then outstanding. Any issuance of capital stock of the Corporation
(other than an issuance pursuant to any plan which has received stockholder
approval, any issuance pursuant to the Rights Agreement dated as of April 6,
1993 by and between AptarGroup, Inc. and Chemical Bank, as amended from time to
time in accordance with its terms, or any issuance in connection with an
acquisition of at least a majority of another corporation, partnership or other
entity) must be approved by a resolution adopted by directors constituting not
less than seventy percent (70%) of the whole Board of Directors.
4.2 Preferred Stock. The Board of Directors of the Corporation may,
by a resolution adopted by directors constituting not less than seventy percent
(70%) of the whole Board of Directors and subject to the limitations prescribed
by law and the provisions of this Certificate of Incorporation, provide for the
issuance of shares of the Preferred Stock or provide for the issuance of shares
of the Preferred Stock in one or more series, establish from time to time the
number of shares to be included in each such series and fix the designations,
voting powers, preferences, rights and qualifications, limitations or
restrictions of the shares of the Preferred Stock of each such series. The
provisions set forth in this Section 4.2 may not be amended, altered, changed or
repealed in any respect unless such action is approved by the affirmative vote
of the holders of not less than eighty percent (80%) of the outstanding shares
of Common Stock entitled to vote on each matter on which the holders of record
of Common Stock shall be entitled to vote.
4.3 Common Stock. Except as otherwise provided by the General
Corporation Law of the State of Delaware, by this Certificate of Incorporation
or any amendments hereto and subject to the rights of holders of Preferred
Stock, all of the voting power of the stockholders of the Corporation shall be
vested in the holders of the Common Stock, and each holder of Common Stock shall
have one (1) vote for each share of Common Stock held by such holder on all
matters voted upon by the stockholders.
4.4 Definition. For purposes of this Article Fourth, "whole Board of
Directors" means the total number of directors which the Corporation would have
on the Board of Directors if there were no vacancies.
ARTICLE FIVE
------------
In furtherance and not in limitation of the powers conferred by
statute, the Board of Directors of the Corporation is expressly authorized to
adopt, amend or repeal the By-Laws of the Corporation. Any adoption, amendment
or repeal of the By-Laws of the Corporation by the Board of Directors shall
require the approval of directors constituting not less than seventy percent
- 3 -
<PAGE>
(70%) of the whole Board of Directors. The stockholders shall also have power to
adopt, amend or repeal the By-Laws of the Corporation; provided, however, that,
in addition to any vote of the holders of any class or series of stock of the
Corporation required by law or by this Certificate of Incorporation, the
affirmative vote of the holders of not less than eighty percent (80%) of the
outstanding shares of Common Stock entitled to vote on each matter on which the
holders of record of Common Stock shall be entitled to vote shall be required in
order for the stockholders to adopt, amend or repeal any provision of the By-
Laws of the Corporation. For purposes of this Article Five, "whole Board of
Directors" means the total number of directors which the Corporation would have
on the Board of Directors, if there were no vacancies. The provisions set forth
in this Article Five may not be amended, altered, changed or repealed in any
respect unless such action is approved by the affirmative vote of the holders of
not less than eighty percent (80%) of the outstanding shares of Common Stock
entitled to vote on each matter on which the holders of record of Common Stock
shall be entitled to vote.
ARTICLE SIX
-----------
Meetings of stockholders may be held within or without the State of
Delaware, as the By-Laws of the Corporation may provide. The books of the
Corporation may be kept outside the State of Delaware at such place or places as
may be designated from time to time by the Board of Directors or in the By-Laws
of the Corporation. All elections of directors shall be by written ballot.
ARTICLE SEVEN
-------------
7.1 Number of Directors. Subject to any rights of the holders of the
Preferred Stock or any series thereof to elect additional directors under
specified circumstances, the number of directors which shall constitute the
whole Board of Directors of the Corporation shall be such number as shall from
time to time be fixed by resolution adopted by directors constituting not less
than seventy (70%) of the whole Board of Directors. The Board is divided into
three classes, as nearly equal in number as possible, with the term of the
office of the first class to expire at the 1994 annual meeting of stockholders,
the term of office of the second class to expire at the 1995 annual meeting of
stockholders and the term of office of the third class to expire at the 1996
annual meeting of stockholders. At each annual meeting of stockholders beginning
with the 1994 annual meeting of stockholders, directors elected to succeed those
directors whose terms expire shall be elected for a term of office to expire at
the third succeeding annual meeting of stockholders after their election. The
foregoing notwithstanding, each director shall serve until his successor shall
have duly elected and qualified, unless he shall resign, die, become
disqualified or be removed.
7.2 Vacancies and Newly Created Directorships. Subject to any rights
of the holders of the Preferred Stock or any series thereof to fill such newly
created directorships or
- 4 -
<PAGE>
vacancies, any newly created directorships resulting from any increase in the
authorized number of directors and any vacancies in the Board of Directors
resulting from death, resignation, disqualification, removal or other cause
shall, unless otherwise provided by law or by a resolution approved by directors
constituting not less than seventy percent (70%) of the whole Board of
Directors, be filled only by a resolution approved by directors constituting not
less than seventy percent (70%) of the whole Board of Directors, and any
directors so chosen shall hold office until the next election of the classes for
which such director shall have been chosen, and until his successor shall have
been duly elected and qualified, unless he shall resign, die, become
disqualified or be removed. Notwithstanding the foregoing, in the event that at
the time of the existence of an unfilled newly created directorship or vacancy
there are unfilled newly created directorships and/or vacancies constituting
more than thirty percent (30%) of the whole Board of Directors, a majority of
the directors then serving on the Board of Directors shall have the authority to
fill enough of such unfilled newly created directorships and/or vacancies so
that, after giving effect thereto, there will be the minimum number of directors
serving on the Board of Directors necessary to constitute seventy percent (70%)
of the whole Board of Directors.
7.3 Powers, Qualifications and Removal. The business of the
Corporation shall managed by or under the direction of the Board of Directors.
Any director may tender his resignation at any time. Subject to any rights of
the holders of the Preferred Stock or any series thereof, any director or the
entire Board of Directors may be removed at any time, but only for cause.
7.4 Definition. For purposes of this Article Seven, "whole Board of
Directors" means the total number of directors which the Corporation would have
on the Board of Directors if there were no vacancies.
7.5 Amendment. The provisions set forth in this Article Seven may
not be amended, altered, changed or repealed in any respect unless such action
is approved by the affirmative vote of the holders of not less than eighty
percent (80%) of the outstanding shares of Common Stock entitled to vote on each
matter on which the holders of record of Common Stock shall be entitled to vote.
ARTICLE EIGHT
-------------
8.1 Special Meetings of Stockholders. Special meeting of
stockholders of the Corporation may be called only by the Board of Directors
pursuant to a resolution approved by a majority of the whole Board of Directors.
8.2 No Stockholder Action by Consent. No action required to be taken
or which may be taken at any annual or special meeting of stockholders of the
Corporation may be taken without a meeting.
- 5 -
<PAGE>
8.3 Advance Notice of Stockholder Nominations. Advance notice of
stockholder nominations of persons for election to the Board of Directors of the
Corporation and of business to be brought before any meeting of the stockholders
by the stockholders of the Corporation shall be given in the manner provided in
the By-Laws of the Corporation.
8.4 Definition. For purposes of this Article Eight, "whole Board of
Directors" means the total number of directors which the Corporation would have
on the Board of Directors if there were no vacancies.
8.5 Amendment. The provisions set forth in this Article Eight may
not be amended, altered, changed or repealed in any respect unless such action
is approved by the affirmative vote of the holders of not less than eighty
percent (80%) of the outstanding shares of Common Stock entitled to vote on each
matter on which the holders of record Common Stock shall be entitled to vote.
ARTICLE NINE
------------
To the fullest extent permitted by the General Corporation Law of the
State of Delaware as the same exists or may hereafter be amended, a director of
the Corporation shall not be liable to the Corporation or its stockholders for
monetary damages for a breach of fiduciary duty as a director. Any repeal or
modification of this Article Nine shall not adversely affect any right or
protection of a director of the Corporation existing at the time of such repeal
or modification. The provisions set forth in this Article Nine may not be
amended, altered, changed or repealed in any respect unless such action is
approved by the affirmative vote of the holders of not less than eighty percent
(80%) of the outstanding shares of Common Stock entitled to vote on each matter
on which the holders of record of Common Stock shall be entitled to vote.
ARTICLE TEN
-----------
The Corporation elects not to be governed by Section 203 of the
General Corporation Law of the State of Delaware.
ARTICLE ELEVEN
--------------
11.1 Business Combinations with Interested Stockholders. The
Corporation shall not engage in any business combination with any interested
stockholder for a period of 3 years following the date that such stockholder
became an interested stockholder, unless (A) prior to such date a majority of
the whole Board of Directors approved either the business combination or the
transaction which resulted in the stockholder becoming an interested
stockholder, or (B) upon consummation of the transaction which resulted in the
stockholder becoming an interested
- 6 -
<PAGE>
stockholder, the interested stockholder owned at least 85% of the voting stock
of the Corporation outstanding at the time the transaction commenced, excluding
for purposes of determining the number of shares outstanding those shares owned
(i) by persons who are directors and also officers of the Corporation and (ii)
by employee stock plans of the Corporation or its subsidiaries in which employee
participants do not have the right to determine confidentially whether shares of
stock of the Corporation held subject to the plan will be tendered in a tender
or exchange offer, or (C) on or subsequent to such date the business combination
is approved by a majority of the whole Board of Directors and authorized at an
annual or special meeting of stockholders, and not by written consent, by
affirmative vote of at least 66% of the outstanding voting stock of the
Corporation which is not owned by the interested stockholder.
11.2 Exclusions. The restrictions contained in this Article
Eleven shall not apply if:
(A) a stockholder becomes an interested stockholder inadvertently and
(i) as soon as practicable divests sufficient shares so that the stockholder
ceases to be an interested stockholder and (ii) would not, at any time within
the 3-year period immediately prior to a business combination between the
Corporation and such stockholder, have been an interested stockholder but for
the inadvertent acquisition; or
(B) the business combination is proposed prior to the consummation or
abandonment of and subsequent to the earlier of the public announcement or the
notice required hereunder of a proposed transaction which (i) constitutes one of
the transactions described in the second sentence of this subsection (B); (ii)
is with or by a person who either was not an interested stockholder during the
previous 3 years or who became an interested stockholder with the prior approval
of a majority of the Corporation's whole Board of Directors; and (iii) is
approved or not opposed by a majority of the members of the Board of Directors
then in office (but not less than 1) who were directors prior to any person
becoming an interested stockholder during the previous 3 years or were
recommended for election or elected to succeed such directors by a majority of
such directors. The proposed transactions referred to in the preceding sentence
are limited to (x) a merger or consolidation of the Corporation (except for a
merger in respect of which, pursuant to Section 251 (f) of the General
Corporation Law of the State of Delaware or any successor provision, no vote of
the stockholders of the Corporation is required); (y) a sale, lease, exchange,
mortgage, pledge, transfer or other disposition (in one transaction or a series
of transactions), whether as part of a dissolution or otherwise, of assets of
the Corporation or of any direct of indirect or indirect majority-owned
subsidiary of the Corporation (other than to any direct or indirect wholly-owned
subsidiary or to the Corporation) having an aggregate market value equal to 50%
or more of either the aggregate market value of all of the assets of the
Corporation determined on a consolidated basis or the aggregate market value of
all the outstanding stock of the Corporation; and (z) a proposed tender or
exchange offer for 50% or more of the outstanding voting stock of the
Corporation. The Corporation shall give not less than 20 days' notice to all
stockholders known to it to be interested stockholders prior to the consummation
of any of the transactions described in clause (x) or (y) of the second sentence
of this subsection (B).
- 7 -
<PAGE>
11.3 Definitions. As used in this Article Eleven only, the term:
(A) "affiliate" means a person that directly, or indirectly through
one or more intermediaries, controls, or is controlled by, or is under common
control with, another person; provided that, for purposes of this Article
Eleven, the term "affiliate" shall not include any person that is an exempt
person.
(B) "associate," when used to indicate a relationship with any
person, means (i) any corporation or organization of which such person is a
director, officer or partner or is, directly or indirectly, the owner of 20% or
more of any class of voting stock, (ii) any trust or other estate in which such
person has at least a 20% beneficial interest or as to which such person serves
as trustee or in a similar fiduciary capacity, and (iii) any relative or spouse
of such person, or any relative of such spouse, who has the residence as such
person; provided that, for purposes of this Article Eleven, the term "associate"
shall not include any person that is an exempt person.
(C) "business combination," when used in reference to the Corporation
and any interested stockholder of the Corporation, means :
(i) any merger or consolidation of the Corporation or any direct
or indirect majority-owned subsidiary of the Corporation with (1) the
interested stockholder or (2) any other person if the merger or
consolidation is caused by the interested stockholder and as a result
of such merger or consolidation Section 11.1 of this Article Eleven is
not applicable to the surviving person;
(ii) any sale, lease, exchange, mortgage, pledge, transfer or
other disposition (in one transaction or a series of transactions),
except proportionately as a stockholder of the Corporation, to or with
the interested stockholder, whether as part of a dissolution or
otherwise, of assets of the Corporation or of any direct or indirect
majority-owned subsidiary of the Corporation which assets have an
aggregate market value equal to 10% or more of either the aggregate
market value of all assets of the Corporation determined on a
consolidated basis or the aggregate market value of all the
outstanding stock of the Corporation;
(iii) any transaction which results in the issuance or transfer
by the Corporation or by any direct or indirect majority-owned
subsidiary of the Corporation of any stock of the Corporation or of
such subsidiary to the interested stockholder, except (1) pursuant to
the exercise, exchange or conversion of securities exercisable for,
exchangeable for or convertible into stock of the Corporation or any
such subsidiary which securities were outstanding prior to the time
that the interested stockholder became such, (2) pursuant to a
dividend or distribution paid or made, or the exercise, exchange or
conversion of any security exercisable for, exchangeable for or
convertible into stock of the Corporation or any such subsidiary which
security is
- 8 -
<PAGE>
distributed, pro rata to all holders of a class or series of stock of
the Corporation subsequent to the time the interested stockholder
became such, (3) pursuant to an exchange offer by the Corporation to
purchase stock made on the same terms to all holders of said stock, or
(4) any issuance or transfer of stock by the Corporation, provided
however, that in no case under (2) - (4) above shall there be an
increase in the interested stockholder's proportionate share of the
stock of any class or series of the Corporation or of the voting stock
of the Corporation;
(iv) any transaction involving the Corporation or any direct or
indirect majority-owned subsidiary of the Corporation which has the
effect, directly or indirectly, of increasing the proportionate share
of the stock of any class or series, or of securities exercisable for,
exchangeable for or convertible into the stock of any class or series,
of the Corporation or of any such subsidiary which is owned by the
interested stockholder, except as a result of immaterial changes due
to fractional share adjustments or as a result of any purchase or
redemption of any shares of stock not caused, directly or indirectly,
by the interested stockholder; or
(v) any receipt by the interested stockholder of the benefit,
directly or indirectly (except proportionately as a stockholder of the
Corporation) of any loans, advances, guarantees, pledges, or other
financial benefits (other than those expressly permitted in subsection
(i) - (iv) above) provided by or through the Corporation or any direct
or indirect majority owned subsidiary.
(D) "control," including the terms "controlling," "controlled by" and
"under common control with," means the possession, directly or indirectly, of
the power to direct or cause the direction of the management and policies of a
person, whether through the ownership of voting stock, by contract, or
otherwise. A person who is the owner of 20% or more of a corporation's
outstanding voting stock shall be presumed to have control of such corporation,
in the absence of proof by a preponderance of the evidence to the contrary.
Notwithstanding the foregoing, a presumption of control shall not apply where
such person holds voting stock, in good faith and not for the purpose of
circumventing this Article Eleven, as an agent, bank, broker, nominee, custodian
or trustee for one or more owners who do not individually or as a group have
control of the Corporation.
(E) "exempt person" means (i) any person that at the time of
determination is the Harris Group, a member thereof or a person or which the
Harris Group or one or more members thereof owns (a) more than fifty percent
(50%) of the voting stock or other voting interests and (b) stock or other
interests representing more than fifty percent (50%) of the total value of the
stock or other interests of such person, (ii) any person that at the time of
determination is the Pfeiffer Group, a member thereof or a person of which the
Pfeiffer Group or one or more members thereof owns (a) more than fifty percent
(50%) of the voting stock or other voting interests and (b) stock or other
interests representing more than fifty percent (50%) of the total value of the
stock or other interests of such person and (iii) any person whose ownership of
shares in excess of the 15% limitation set forth in the definition of
"interested stockholder" is the result of action taken solely by the
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Corporation provided that such person shall cease to be an exempt person if
thereafter he acquires additional shares of voting stock of the Corporation
except as a result of further action by the Corporation not caused, directly or
indirectly, by such person. Notwithstanding the foregoing sentence, none of the
persons described in clause (i) above shall continue to be an exempt person by
virtue of such clause after the earliest date after the Pfeiffer Share Exchange
on which such persons are owners in the aggregate of less than 3% of the
Corporation's outstanding voting stock (determined without taking into account
any securities exercisable or exchangeable for, or convertible into, the
Corporation's voting stock, other than any such securities owned by such
persons), and none of the persons described in clause (ii) above shall continue
to be an exempt person by virtue of such clause after the earliest date after
the Pfeiffer Share Exchange on which such persons are owners in the aggregate of
less than 3% of the Corporation's outstanding voting stock (determined without
taking into account any securities exercisable or exchangeable for, or
convertible into, the Corporation's voting stock, other than any such securities
owned by such persons).
(F) "Harris Group" means Messrs. Irving B. Harris, Neison Harris,
King Harris, William W. Harris and Sidney Barrows and their respective spouses,
descendants and spouses of descendants, trustees of trusts established for the
benefit of such persons (acting in their capacity as trustees of such trusts),
and executors of estates of such persons (acting in their capacity as executors
of such estates).
(G) "interested stockholder" means any person (other than an exempt
person and other than the Corporation and any direct or indirect majority-owned
subsidiary of the Corporation) that (i) is the owner of 15% or more of the
outstanding voting stock of the Corporation, or (ii) is an affiliate or
associate of the Corporation and was the owner of 15% or more of the outstanding
voting stock of the Corporation at any time within the three-year period
immediately prior to the date on which it is sought to be determined whether
such person is an interested stockholder; and the affiliates and associates of
such person. For the purpose of determining whether a person is an interested
stockholder, the voting stock of the Corporation deemed to be outstanding shall
include stock deemed to be owned by the person through application of subsection
(H) of this Section 11.3 but shall not include any other unissued stock of the
Corporation which may be issuable pursuant to any agreement, arrangement or
understanding, or upon exercise of conversion rights, warrants or options, or
otherwise.
(H) "owners" including the terms "own" and "owned," when used with
respect to any stock means a person that individually or with or through any of
its affiliates or associates:
(i) beneficially owns (as determined pursuant to Rule 13d-3 of
the General Rules and Regulations under the Securities Exchange Act of
1934 or any successor provision) such stock, directly or indirectly;
or
(ii) has (1) the right to acquire such stock (whether such right
is exercisable immediately or only after the passage of time) pursuant
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to any agreement, arrangement or understanding, or upon the exercise
of exercise rights, conversion rights, exchange rights, warrants or
options, or otherwise; provided, however, that a person shall not be
deemed the owner of stock tendered pursuant to a tender or exchange
offer made by such person or any of such person's affiliates or
associates until such tendered stock is accepted for purchase or
exchange; or (2) the right to vote such stock pursuant to any
agreement, arrangement or understanding; provided, however, that a
person shall not be deemed the owner of any stock because of such
person's right to vote such stock if the agreement, arrangement or
understanding to vote such stock arises solely from a revocable proxy
or consent given in response to a proxy or consent solicitation made
to 10 or more persons; or
(iii) has any agreement, arrangement or understanding for the
purpose of acquiring, holding, voting (except voting pursuant to a
revocable proxy or consent as described in item (2) of clause (ii) of
this subsection), or disposing of such stock with any other person
that beneficially owns, or whose affiliates or associates beneficially
own, directly or indirectly, such stock.
Nothing in this subsection (H) shall cause a person to be treated as the "owner"
of, or to "own," any securities owned by any other person that is an exempt
person.
(I) "person" means any individual, corporation, partnership,
unincorporated association, trust or other entity.
(J) "Pfeiffer Group" means Peter Pfeiffer, Philipp Pfeiffer, Anne
Pfeiffer, Klaus Pfeiffer, Birgit Pfeiffer, Petra Pfeiffer, Karin Pilz, Norbert
Pilz, Gunther Pilz, Elke Miedler, Gudrun Miedler, Iris Miedler and Stefan
Miedler and their respective spouses, descendants and spouses of descendants,
trustees of trusts established for the benefit of such persons (acting in their
capacity as trustees of such trusts), and executors of estates of such persons
(acting in their capacity as executors of such estates).
(K) "Pfeiffer Share Exchange" has the meaning assigned to such term
in the Combination Agreement dated as of December 31, 1992 to which the
Corporation and certain members of the Pfeiffer Group are parties.
(L) "spouses" includes widows and widowers until first remarried.
(M) "voting stock" means stock of any class or series entitled to
vote generally in the election of directors.
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(N) "whole Board of Directors" means the total number of directors
which the Corporation would have on the Board of Directors if there were no
vacancies.
11.4 Amendment. The provisions set forth in this Article Eleven may
not be amended, altered, changed or repealed in any respect unless such action
is approved by the affirmative vote of at least 66-2/3% of the outstanding
shares of Common Stock entitled to vote on each matter on which the holders of
record of Common Stock shall be entitled to vote which are not owned by an
interested stockholder.
ARTICLE TWELVE
--------------
In the event that it is proposed that the Corporation enter into a
merger or consolidation with any other corporation (other than a direct or
indirect wholly-owned subsidiary of the Corporation), or sell or otherwise
dispose of all or substantially all of its assets or business in one transaction
or a series of transactions, or liquidate or dissolve, the affirmative vote of
the holders of not less than eighty percent (80%) of the outstanding shares of
Common Stock entitled to vote on each matter on which the holders of record of
Common Stock shall be entitled to vote shall be required for the approval of
such proposal; provided, however, that the foregoing shall not apply to any such
merger, consolidation, sale, disposition, liquidation or dissolution which is
approved by resolution of two-thirds of the whole Board of Directors, if the
majority of the members of the Board of Directors adopting such resolution were
members of the Board of Directors of the Corporation prior to the public
announcement of the proposed merger, consolidation, sale, disposition,
dissolution or liquidation and prior to the public announcement of any
transaction relating to such merger, consolidation, sale, disposition,
dissolution or liquidation. If such approval is granted, then such transaction
shall only require the approval otherwise required under the other Articles of
this Certificate of Incorporation and under law. For purposes of this Article
Twelve, "whole Board of Directors" means the total number of directors which the
Corporation would have on the Board of Directors if there were no vacancies. The
provisions set forth in this Article Twelve may not be amended, altered, changed
or repealed in any respect unless such action is approved by the affirmative
vote of the holders of not less than eighty percent (80%) of the outstanding
shares of Common Stock entitled to vote on each matter on which the holders of
record of Common Stock shall be entitled to vote.
ARTICLE THIRTEEN
----------------
13.1 Indemnification of Officers, Directors and Others. The
Corporation shall indemnify any person who was or is a party or is threatened to
be made a party to any threatened, pending or completed action, suit or
proceeding, whether civil, criminal, administrative or investigative (including
any action by or in the right of the Corporation) (a "Proceeding") by reason of
the fact that he is or was a director, officer or employee of the Corporation,
or is or was serving at the request of the Corporation as a director, officer or
employee of another corporation, partnership, joint venture, trust or other
enterprise (including service with respect to any employee benefit plan) against
expenses (including attorneys' fees), judgments, fines, ERISA excise taxes,
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penalties and amounts paid in settlement actually and reasonably incurred by him
in connection with such Proceeding to the fullest extent permitted by the
Delaware General Corporation Law, as the same exists or may hereafter be amended
(but, in the case of any such amendment, only to the extent that such amendment
permits the Corporation to provide broader indemnification rights than such law
permitted the Corporation to provide prior to such amendment). The
indemnification provided by this Article Thirteen shall not be deemed exclusive
of any other rights to which any person may be entitled under any By-Law,
agreement, vote of stockholders or disinterested directors, or otherwise, both
as to action in his official capacity and as to action in another capacity, and
shall continue as to a person who has ceased to be a director, officer or
employee and shall inure to the benefit of the heirs, executors, administrators
and personal representatives of such a person. It is expressly understood that,
notwithstanding the foregoing, no director, officer or employee shall have any
rights under this Article Thirteen if the Proceeding giving rise to the claim
for indemnification hereunder arises as a result of actions or failures to act
in any capacity other than those set forth in this Section 13.1, and, as such,
no such person shall have any rights under this Article Thirteen if the
Proceeding giving rise to the claim for indemnification arises as a result of
such person's purchase and/or sale of securities of the Corporation (other than
on behalf of the Corporation).
13.2 Procedure for Indemnification of Directors, Officers and
Employees. Any indemnification of a director, officer or employee of the
Corporation or advance of expenses under this Article Thirteen shall be made
promptly upon the written request of the director, officer or employee, and in
any event within 30 days after such request (or, if a determination as described
below is required, within 30 days after such determination has been made or
deemed made). If a determination by the Corporation that the director, officer
or employee is entitled to indemnification pursuant to this Article Thirteen is
required, and the Corporation fails to respond within sixty days to a written
request for indemnity, the Corporation shall be deemed to have approved the
request. If the Corporation denies a written request for indemnification or
advancing of expenses, in whole or in part, or if payment in full pursuant to
such request is not made within 30 days after such request (or, if a
determination as described above is required, within 30 days after such
determination has been made or deemed made), the right to indemnification or
advances as granted by this Article Thirteen shall be enforceable by the
director, officer or employee in any court of competent jurisdiction. Such
person's costs and expenses incurred in connection with successfully
establishing his right to indemnification, in whole or in part, in any such
action shall also be indemnified by the Corporation. It shall be a defense to
any such action (other than an action brought to enforce a claim for expenses
incurred in defending any Proceeding in advance of its final disposition where
the required undertaking has been tendered to the Corporation) that the claimant
has not met the standards of conduct which make it permissible under the General
Corporation Law of the State of Delaware for the Corporation to indemnify the
claimant for the amount claimed, but the burden of such defense shall be on the
Corporation. Neither the failure of the Corporation (including its board of
directors, independent legal counsel, or its stockholders) to have made a
determination prior to the commencement of such action that indemnification of
the claimant is proper in the circumstances because he has met the applicable
standard of conduct set forth in the General Corporation Law of the State of
Delaware, nor an actual determination by the Corporation (including its board of
directors, independent legal counsel, or its stockholders) that the claimant has
not met such applicable
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standard of conduct, shall be a defense to the action or create a presumption
that the claimant has not met the applicable standard of conduct.
13.3 Insurance. The Corporation may purchase and maintain insurance
on its own behalf and on behalf of any person who is or was a director, officer
or employee of the Corporation or was serving at the request of the Corporation
as a director, officer or employee of another corporation, partnership, joint
venture, trust or other enterprise (including service with respect to any
employee benefit plan) against any liability asserted against him and incurred
by him in any such capacity, whether or not the Corporation would have the power
to indemnify such person against such liability under this Article Thirteen.
13.4 Expenses. Expenses incurred by any person described in this
Article Thirteen in defending a Proceeding shall be paid by the Corporation in
advance of such Proceeding's final disposition upon receipt of an undertaking by
or on behalf of the director, officer or employee to repay such amount without
interest if it shall ultimately be determined that he is not entitled to be
indemnified by the Corporation.
13.5 Contract Rights. The provisions of this Article Thirteen shall
be deemed to be a contract between the Corporation and each director, officer or
employee who serves in any such capacity at any time, and any repeal or
modification of this Article Thirteen or of any relevant provisions of the
General Corporation Law of the State of Delaware or other applicable law shall
not affect any rights or obligations then existing with respect to any state of
facts or Proceeding then existing.
13.6 Merger or Consolidation. For purposes of this Article Thirteen,
references to "the Corporation" shall include, in addition to the resulting
corporation, any constituent corporation (including any constituent of a
constituent) absorbed in a consolidation or merger which, if its separate
existence had continued, would have had power and authority to indemnify its
directors, officers and employees, so that any person who is or was a director,
officer or employee of such a constituent corporation, or is or was serving at
the request of such a constituent corporation as a director, officer or employee
of another corporation, partnership, joint venture, trust or other enterprise
(including service with respect to any employee benefit plan), shall stand in
the same position under this Article Thirteen with respect to the resulting or
surviving corporation as he would have with respect to such constituent
corporation if its separate existence had continued.
13.7 Indemnification of Agents. The Corporation may, to the extent
authorized from time to time by the Board of Directors, grant rights to
indemnification and to the advancement of expenses to any agent of the
Corporation to the fullest extent of the provisions of this Article Thirteen
with respect to the indemnification and advancement of expenses of directors,
officers and employees of the Corporation.
13.8 Amendment. The provisions set forth in this Article Thirteen
may not be amended, altered, changed or repealed in any respect unless such
actions approved by the affirmative
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vote of the holders of not less than eighty percent (80%) of the outstanding
shares of Common Stock entitled to vote on each matter on which the holders of
record of Common Stock shall be entitled to vote.
ARTICLE FOURTEEN
----------------
The Corporation is to have perpetual existence.
ARTICLE FIFTEEN
---------------
The Corporation reserves the right to amend, alter, change or repeal
any provision contained in this Certificate of Incorporation in the manner now
or hereafter prescribed herein and by the laws of the State of Delaware, and all
rights conferred upon stockholders herein are granted subject to this
reservation.
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EXHIBIT B
CERTIFICATE OF DESIGNATION, PREFERENCES AND RIGHTS
OF JUNIOR PARTICIPATING PREFERRED STOCK, SERIES A
of
AptarGroup, Inc.
Pursuant to Section 151
of the General Corporation Law
of the State of Delaware
We, Carl A. Siebel, Chairman of the Board and Chief Executive Officer,
and Stephen J. Hagge, Executive Vice President and Chief Financial Officer,
Secretary and Treasurer, of AptarGroup, Inc., a corporation organized and
existing under the General Corporation Law of the State of Delaware, in
accordance with the provisions of Section 151 thereof, DO HEREBY CERTIFY:
That (i) pursuant to the authority conferred upon the Board of
Directors of the said Corporation by the Amended and Restated Certificate of
Incorporation of the Corporation, the Board of Directors effective April 6, 1993
adopted the following resolution creating a series of 45,000 shares of Preferred
Stock designated as Junior Participating Preferred Stock, Series A, (ii) such
resolution was amended by a resolution of the said Board of Directors adopted on
January 21, 1999, which authorized an increase in the number of shares
constituting such series to 49,500 shares, subject to the adoption by the
stockholders of the Corporation of an amendment to the Amended and Restated
Certificate of Incorporation to increase the authorized shares of Common Stock
of the Corporation (the "Proposed Amendment"), (iii) the Proposed Amendment was
approved by the Corporation's stockholders on May 11, 1999, (iv) the Corporation
filed a Certificate of Increase in respect of such series with the Secretary of
State of the State of Delaware on May 11, 1999, and (v) the resolution
establishing the Junior Participating Preferred Stock, Series A reads, as
amended to reflect the Certificate of Increase, as follows:
RESOLVED, that pursuant to the authority vested in the Board of
Directors of this Corporation in accordance with the provisions of its Amended
and Restated Certificate of Incorporation a series of Preferred Stock of the
Corporation designated Junior Participating Preferred Stock, Series A be, and it
hereby is, created, and that the designations and amount thereof and the voting
powers, preferences and relative, participating, optional and other special
rights of the shares of such series, and the qualifications, limitations or
restrictions thereof are as follows:
Section 1. Designation and Amount. The shares of such series shall
be designated as "Junior Participating Preferred Stock, Series A" (the "Series A
Preferred Stock") and the number of shares constituting such series shall be
49,500.
<PAGE>
Section 2. Dividends and Distributions.
---------------------------
(A) Subject to the prior and superior rights of the holders of any
shares of any series of Preferred Stock ranking prior and superior to the shares
of Series A Preferred Stock with respect to dividends, the holders of shares of
Series A Preferred Stock, in preference to the holders of Common Stock, par
value $.01 per share, of the Corporation (the "Common Stock") and of any other
stock ranking junior as to dividends, shall be entitled to receive, when, as and
if declared by the Board of Directors out of funds legally available for the
purpose, quarterly dividends payable in cash or in kind on the 15th day of
March, June, September and December in each year (each such date being referred
to herein as a "Quarterly Dividend Payment Date") commencing on the first
Quarterly Dividend Payment Date after the first issuance of a share or fraction
of a share of Series A Preferred Stock, each in an amount per share (rounded to
the nearest cent) equal to the grater of (a) $10.00 or (b) subject to the
provision for adjustment hereinafter set forth, 1,000 times the aggregate per
share amount of all cash dividends, and 1,000 times the aggregate per share
amount (payable in kind) of all non-cash dividends or other distributions other
than a dividend payable in Common Stock or a subdivision of the outstanding
Common Stock (by reclassification or otherwise), declared on the Common Stock
since the immediately preceding Quarterly Dividend Payment Date (inclusive) or,
with respect to the first Quarterly Dividend Payment Date, since the first
issuance of any share or fraction of a share of Series A Preferred Stock
(inclusive). In the event the Corporation shall at any time on or after April 6,
1993 declare or pay any dividend on Common Stock payable in shares of Common
Stock, or effect a subdivision or combination or consolidation of the
outstanding Common Stock (by reclassification or otherwise than by payment of a
dividend in shares of Common Stock) into a greater or lesser number of shares of
Common Stock, then in each such case the amount to which holders of shares of
Series A Preferred Stock are entitled immediately after such event under the
preceding sentence shall be an amount per share (rounded to the nearest cent)
equal to the greater of (i) $10.00 and (ii) the amount resulting from
multiplying the amount to which holders of shares of Series A Preferred Stock
were entitled immediately prior to such event under the preceding sentence by a
fraction the numerator of which is the number of shares of Common Stock
outstanding immediately after such event and the denominator of which is the
number of shares of Common Stock that were outstanding immediately prior to such
event.
(B) The Corporation shall declare a dividend or distribution on the
Series A Preferred Stock as provided in paragraph (A) of this Section
immediately after its declares any dividend or distribution on the Common Stock
(other than a dividend payable in Common Stock or a distribution of Common Stock
pursuant to a subdivision of the outstanding Common Stock), and, unless
previously paid, the Corporation shall pay dividends or distributions on the
Series A Preferred Stock immediately before it pays such dividend or
distribution on the Common Stock (other than a dividend payable in Common Stock
or a distribution of Common Stock pursuant to a subdivision of the outstanding
Common Stock); provided that, in the event no dividend or distribution shall
have been declared on the Common Stock during the period from any Quarterly
Dividend Payment Date to the next subsequent Quarterly Dividend Payment Date (or
if the aggregate amount of any dividends or distributions declared during such
period was less than $10.00), a dividend of $10.00 (or the
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difference between $10.00 and the aggregate amount of dividends or distributions
declared during such period if such amount was less than $10.00) per share on
the Series A Preferred Stock shall nevertheless be payable on such subsequent
Quarterly Dividend Payment Date.
(C) Dividends on shares of Series A Preferred Stock shall being to
accrue and be cumulative on outstanding shares of Series A Preferred Stock from
the Quarterly Dividend Payment Date next preceding the date of issue of such
shares of Series A Preferred Stock, unless the date of issue of such shares is
prior to the record date for the first dividend to be paid on any shares of
Series A Preferred Stock, in which case dividends on such shares shall begin to
accrue from the date of issue of such shares, or unless the date of issue is a
Quarterly Dividend Payment Date or is a date after the record date for the
determination of holders of shares of Series A Preferred Stock entitled to
receive a quarterly dividend on a particular Quarterly Dividend Payment Date and
before such Quarterly Dividend Payment Date, in either of which events such
dividends shall begin to accrue and be cumulative from such Quarterly Dividend
Payment Date. Accrued but unpaid dividends shall not bear interest. Dividends
paid on the shares of Series A Preferred Stock in an amount less than the total
amount of such dividends at the time accrued and payable on such shares shall be
allocated pro rata among all such shares at the time outstanding. The Board of
Directors shall fix a record date for the determination of holders of shares of
Series A Preferred Stock entitled to receive payment of a dividend or
distribution declared thereon, which record date shall be the same as any record
date for the determination of holders of shares of Common Stock entitled to
receive payment of a dividend or distribution thereon (other than a dividend
payable in Common Stock or a distribution of Common Stock pursuant to a
subdivision of the outstanding Common Stock) but in any event not more than 60
days prior to the date fixed for the payment thereof.
Section 3. Voting Rights. The holders of shares of Series A
Preferred Stock shall have the following voting rights:
(A) Subject to the provision for adjustment hereinafter set forth,
each share of Series A Preferred Stock shall entitle the holder thereof to 1,000
votes on all matters submitted to a vote of the stockholders of the Corporation.
In the event the Corporation shall at any time on or after April 6, 1993 declare
or pay any dividend on Common Stock payable in shares of Common Stock, or effect
a subdivision or combination or consolidation of the outstanding Common Stock
(by reclassification or otherwise than by payment of a dividend in shares of
Common Stock) into a greater or lesser number of shares of Common Stock, then in
each such case the number of votes per share to which holders of shares of
Series A Preferred Stock were entitled immediately prior to such event shall be
adjusted by multiplying such number of votes by a fraction the numerator of
which is the number of shares of Common Stock outstanding immediately after such
event and the denominator of which is the number of shares of Common Stock that
were outstanding immediately prior to such event.
(B) Except as otherwise provided herein or by law, the holders of
shares of Series A Preferred Stock and the holders of Common Stock shall vote
together as one class on all matters submitted to a vote of stockholders of the
Corporation.
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(C) Except as set forth herein, holders of Series A Preferred Stock
shall have no special voting rights and their consent shall not be required
(except to the extent they are entitled to vote with holders of Common Stock as
set forth herein) for taking any corporate action.
Section 4. Certain Restrictions.
--------------------
(A) Whenever quarterly dividends or other dividends or distributions
payable on the Series A Preferred Stock as provided in Section 2 are in arrears,
thereafter and until all accrued and unpaid dividends and distributions, whether
or not declared, on shares of Series A Preferred Stock outstanding shall have
been paid in full, the Corporation shall not:
(i) declare or pay dividends on, or make any other
distributions on, any shares of stock ranking junior (either as to dividends or
upon liquidation, dissolution or winding up) to the Series A Preferred Stock;
(ii) declare or pay dividends on, or make any other
distributions on, any shares of stock ranking on a parity (either as to
dividends or upon liquidation, dissolution or winding up) with the Series A
Preferred Stock, except dividends paid ratably on the Series A Preferred Stock
and all such parity stock on which dividends are payable or in arrears in
proportion to the total amounts to which the holders of all such shares are then
entitled;
(iii) redeem or purchase or otherwise acquire for consideration
shares of any stock ranking junior (either as to dividends or upon liquidation,
dissolution or winding up) to the Series A Preferred Stock, provided that the
Corporation may at any time redeem, purchase or otherwise acquire shares of any
such junior stock in exchange for shares of any stock of the Corporation ranking
junior (either as to dividends or upon dissolution, liquidation or winding up)
to the Series A Preferred Stock; or
(iv) purchase or otherwise acquire for consideration any shares
of Series A Preferred Stock, or any shares of stock ranking on a parity with the
Series A Preferred Stock, except in accordance with a purchase offer made in
writing or by publication (as determined by the Board of Directors) to all
holders of such shares upon such terms as the Board of Directors, after
consideration of the respective annual dividend rates and other relative rights
and preferences of the respective series and classes, shall determine in good
faith will result in fair and equitable treatment among the respective series or
classes.
(B) The Corporation shall not permit any subsidiary of the
Corporation to purchase or otherwise acquire for consideration any shares of
stock of the Corporation unless the Corporation could, under paragraph (A) of
this Section 4, purchase or otherwise acquire such shares at such time and in
such manner.
Section 5. Reacquired Shares. Any shares of Series A Preferred Stock
purchased or otherwise acquired by the Corporation in any manner whatsoever
shall be retired and canceled
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promptly after the acquisition thereof. All such shares shall upon their
cancellation become authorized but unissued shares of Preferred Stock and may be
reissued as part of a new series of Preferred Stock to be created by resolution
or resolutions of the Board of Directors, subject to the conditions and
restrictions on issuance set forth herein.
Section 6. Liquidation, Dissolution or Winding Up. Upon any
liquidation, dissolution or winding up of the Corporation, no distribution shall
be made (1) to the holders of shares of stock ranking junior (either as to
dividends or upon liquidation, dissolution or winding up) to the Series A
Preferred Stock unless, prior thereto, the holders of shares of Series A
Preferred Stock shall have received $1,000 per share, plus an amount equal to
accrued and unpaid dividends and distributions thereon, whether or not declared,
to the date of such payment, provided that the holders of shares of Series A
Preferred Stock shall be entitled to receive an aggregate amount per share,
subject to the provision for adjustment hereinafter set forth, equal to 1,000
times the aggregate amount to be distributed per share of holders of Common
Stock, or (2) to the holders of stock ranking on a parity (either as to
dividends or upon liquidation, dissolution or winding up) with the Series A
Preferred Stock, except distributions made ratably on the Series A Preferred
Stock and all other such parity stock in proportion to the total amounts to
which the holders of all such shares are entitled upon such liquidation,
dissolution or winding up. In the event the Corporation shall at any time on or
after April 6, 1993 declare or pay any dividend on Common Stock payable in
shares of Common Stock, or effect a subdivision or combination or consolidation
of the outstanding Common Stock (by reclassification or otherwise than by
payment of a dividend in shares of Common Stock) into a greater or lesser number
of shares of Common Stock, then in each such case the aggregate amount to which
holders of shares of Series A Preferred Stock are entitled immediately after
such event under the proviso in clause (1) of the preceding sentence shall be
adjusted by multiplying such amount by a fraction the numerator of which is the
number of shares of Common Stock outstanding immediately after such event and
the denominator of which is the number of shares of Common Stock that were
outstanding immediately prior to such event.
Section 7. Consolidation, Merger, etc. In the case the Corporation
shall enter into any consolidation, merger, combination or other transaction in
which the Common Stock is exchanged for or changed into other stock or
securities, cash and/or any other property, then in any such case the shares of
Series A Preferred Stock then outstanding shall at the same time be similarly
exchanged for or changed into property in an amount per share (subject to the
provision for adjustment hereinafter set forth) equal to 1,000 times the
aggregate amount of stock, securities, cash and/or any other property (payable
in kind), as the case may be, into which or for which each share of Common Stock
is changed or exchanged. In the event the Corporation shall at any time on or
after April 6, 1993 declare or pay any dividend on the Common Stock payable in
shares of Common Stock, or effect a subdivision or combination or consolidation
of the outstanding Common Stock (by reclassification of otherwise) into a
greater or lesser number of shares of Common Stock, then in each such case the
amount set forth in the preceding sentence with respect to the exchange or
change of shares of Series A Preferred Stock shall be adjusted by multiplying
such amount by a fraction the numerator of which is the number of shares of
Common Stock outstanding immediately after such
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<PAGE>
event and the denominator of which is the number of shares of Common Stock that
were outstanding immediately prior to such event.
Section 8. Redemption. The shares of Series A Preferred Stock shall
not be redeemable.
Section 9. Other Series of Preferred Stock. Notwithstanding any
other provision of the Certificate of Incorporation of the Corporation, as
amended, the Series A Preferred Stock shall rank prior to each and every class
or series of Common Stock of the Corporation, and junior to each and every other
class or series of the Corporation's Preferred Stock, as to payment of dividends
and distribution of assets except to the extent the terms of any such other
class or series of Preferred Stock shall provide otherwise.
Section 10. Amendment. Neither the Certificate of Incorporation of
the Corporation, this resolution, nor any restated Certificate of Designation,
Preferences and Rights relating to the Series A Preferred Stock shall be amended
in any manner which would alter or change the powers, preferences or special
rights of the Series A Preferred Stock so as to affect the holders of Series A
Preferred Stock adversely without the affirmative vote of the holders of two-
thirds of the outstanding shares of Series A Preferred Stock, voting separately
as a single class.
Section 11. Fractional Shares. Series A Preferred Stock may be issued
in whole shares and fractions of a share. A fraction of a share shall entitle
the holder, in proportion to that fraction, to exercise voting rights, receive
dividends and participate in distributions and to have the benefit of all other
rights of holders of Series A Preferred Stock.
This Certificate of Designation shall become effective at 9:05 a.m., Delaware
time, on April 6, 1993.
IN WITNESS WHEREOF, we have executed and subscribed this Certificate
and do affirm the foregoing as true under the penalties of perjury as of this
11th day of May, 1999.
/s/ Carl A. Siebel
-------------------------------------
President and Chief Executive Officer
ATTEST:
/s/ Stephen J. Hagge
- -----------------------
Secretary
- 6 -
<PAGE>
Exhibit 4.1
CONFORMED COPY
================================================================================
APTARGROUP, INC.
$200,000,000
Senior Notes Issuable In Series
$107,000,000
6.62% Senior Notes, Series 1999-A
due May 30, 2011
_________
NOTE PURCHASE AGREEMENT
_________
Dated as of May 15, 1999
================================================================================
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
<S> <C>
Section Page
- ------- ----
1. AUTHORIZATION OF NOTES........................................... 1
1.1. Amount; Establishment of Series........................... 1
1.2. The Series 1999-A Notes................................... 2
2. SALE AND PURCHASE OF SERIES 1999-A NOTES......................... 2
3. CLOSING.......................................................... 3
4. CONDITIONS TO CLOSING............................................ 3
4.1. Representations and Warranties............................ 3
4.2. Performance; No Default................................... 3
4.3. Compliance Certificates................................... 3
4.4. Opinions of Counsel....................................... 4
4.5. Purchase Permitted By Applicable Law, etc................. 4
4.6. Sale of Other Series 1999-A Notes......................... 4
4.7. Payment of Special Counsel Fees........................... 4
4.8. Private Placement Number.................................. 4
4.9. Changes in Corporate Structure............................ 5
4.10. Proceedings and Documents................................. 5
5. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.................... 5
5.1. Organization; Power and Authority......................... 5
5.2. Authorization, etc........................................ 5
5.3. Disclosure................................................ 6
5.4. Organization and Ownership of Shares of Subsidiaries;
Affiliates.............................................. 6
5.5. Financial Statements...................................... 7
5.6. Compliance with Laws, Other Instruments, etc.............. 7
5.7. Governmental Authorizations, etc.......................... 7
5.8. Litigation; Observance of Agreements, Statutes and Orders. 7
5.9. Taxes..................................................... 8
5.10. Title to Property; Leases................................. 8
5.11. Licenses, Permits, etc.................................... 8
5.12. Compliance with ERISA..................................... 9
5.13. Private Offering by the Company........................... 10
5.14. Use of Proceeds; Margin Regulations....................... 10
5.15 Existing Indebtedness; Future Liens....................... 10
5.16. Foreign Assets Control Regulations, etc................... 11
5.17. Status under Certain Statutes............................. 11
5.18. Environmental Matters..................................... 11
5.19. Year 2000................................................. 12
</TABLE>
i
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<TABLE>
<S> <C>
6. REPRESENTATIONS OF THE PURCHASERS................................ 12
6.1. Purchase for Investment................................... 12
6.2. Source of Funds........................................... 12
7. INFORMATION AS TO COMPANY........................................ 12
7.1. Financial and Business Information........................ 12
7.2. Officer's Certificate..................................... 17
7.3. Inspection................................................ 17
8. PREPAYMENT OF THE SERIES 1999-A NOTES............................ 12
8.1. Required Prepayments...................................... 18
8.2. Optional Prepayments with Make-Whole Amount............... 18
8.3. Allocation of Partial Prepayments......................... 18
8.4. Maturity; Surrender, etc.................................. 19
8.5. Purchase of Notes......................................... 19
8.6. Make-Whole Amount......................................... 19
9. AFFIRMATIVE COVENANTS............................................ 20
9.1. Compliance with Law....................................... 21
9.2. Insurance................................................. 21
9.3. Maintenance of Properties................................. 21
9.4. Payment of Taxes and Claims............................... 21
9.5. Corporate Existence, etc.................................. 21
10. NEGATIVE COVENANTS............................................... 22
10.1. Adjusted Consolidated Net Worth........................... 22
10.2. Indebtedness.............................................. 22
10.3. Liens..................................................... 23
10.4. Sale of Assets............................................ 24
10.5. Mergers, Consolidations, etc.............................. 25
10.6. Disposition of Stock of Restricted Subsidiaries........... 26
10.7. Designation of Unrestricted and Restricted Subsidiaries... 26
10.8. Nature of Business........................................ 27
10.9. Transactions with Affiliates.............................. 27
11. EVENTS OF DEFAULT................................................ 27
12. REMEDIES ON DEFAULT, ETC......................................... 29
12.1. Acceleration.............................................. 29
12.2. Other Remedies............................................ 30
12.3. Rescission................................................ 30
12.4. No Waivers or Election of Remedies, Expenses, etc......... 30
13. REGISTRATION; EXCHANGE; SUBSTITUTION OF NOTES.................... 31
13.1. Registration of Notes..................................... 31
13.2. Transfer and Exchange of Notes............................ 31
13.3. Replacement of Notes...................................... 31
</TABLE>
ii
<PAGE>
<TABLE>
<S> <C>
14. PAYMENTS ON NOTES................................................ 32
14.1. Place of Payment.......................................... 32
14.2. Home Office Payment....................................... 32
15. EXPENSES, ETC.. ................................................. 33
15.1. Transaction Expenses...................................... 33
15.2. Survival.................................................. 33
16. SURVIVAL OF REPRESENTATIONS AND WARRANTIES; ENTIRE AGREEMENT..... 33
17. AMENDMENT AND WAIVER............................................. 34
17.1. Requirements.............................................. 34
17.2. Solicitation of Holders of Notes.......................... 34
17.3. Binding Effect, etc....................................... 34
17.4. Notes held by Company, etc................................ 35
18. NOTICES.......................................................... 35
19. REPRODUCTION OF DOCUMENTS........................................ 35
20. CONFIDENTIAL INFORMATION......................................... 35
21. SUBSTITUTION OF PURCHASER........................................ 35
22. MISCELLANEOUS.................................................... 35
22.1. Successors and Assigns.................................... 37
22.2. Payments Due on Non-Business Days......................... 37
22.3. Severability.............................................. 37
22.4. Construction.............................................. 37
22.5. Counterparts.............................................. 38
22.6. Governing Law............................................. 38
</TABLE>
SCHEDULE A -- Information Relating to Purchasers
SCHEDULE B -- Defined Terms
SCHEDULE B-1 -- Existing Investments
SCHEDULE 4.9 -- Changes in Corporate Structure
SCHEDULE 5.3 -- Disclosure Materials
SCHEDULE 5.4 -- Subsidiaries of the Company and Ownership of
Subsidiary Stock
SCHEDULE 5.5 -- Financial Statements
iii
<PAGE>
SCHEDULE 5.8 -- Certain Litigation
SCHEDULE 5.11 -- Licenses, Permits, etc.
SCHEDULE 5.14 -- Use of Proceeds
SCHEDULE 5.15 -- Existing Indebtedness
SCHEDULE 10.3 -- Existing Liens
EXHIBIT 1.1-A -- Form of Senior Note
EXHIBIT 1.1-B -- Form of Supplement
EXHIBIT 1.2 -- Form of Series 1999-A Senior Note
EXHIBIT 4.4(a) -- Form of Opinion of Counsel to the Company
EXHIBIT 4.4(b) -- Form of Opinion of Special Counsel to the Purchasers
iv
<PAGE>
APTARGROUP, INC.
475 West Terra Cotta Avenue, Suite E
Crystal Lake, IL 60014
(815) 477-0424
Fax: (815) 477-0481
$200,000,000
Senior Notes Issuable In Series
$107,000,000
6.62% Senior Notes, Series 1999-A
due May 30, 2011
Dated as of May 15, 1999
TO EACH OF THE PURCHASERS LISTED IN
THE ATTACHED SCHEDULE A:
Ladies and Gentlemen:
APTARGROUP, INC., a Delaware corporation (the "Company"), agrees with
you as follows:
1. AUTHORIZATION OF NOTES.
1.1. Amount; Establishment of Series.
The Company is contemplating the issue and sale of up to $200,000,000
aggregate principal amount of its Senior Notes issuable in series (the "Notes",
such term to include any such Notes issued in substitution therefor pursuant to
Section 13 of this Agreement). The Notes will be substantially in the form set
out in Exhibit 1.1-A, with such changes therefrom, if any, as may be approved by
the purchasers of such Notes, or series thereof, and the Company. Certain
capitalized terms used in this Agreement are defined in Schedule B; references
to a "Schedule" or an "Exhibit" are, unless otherwise specified, to a Schedule
or an Exhibit attached to this Agreement. The Notes may be issued in one or
more series. Each series of Notes, other than the initial series, will be
issued pursuant to a supplement to this Agreement (a "Supplement") in
substantially the form of Exhibit 1.1-B, and will be subject to the following
terms and conditions:
(a) the designation of each series of Notes shall distinguish the
Notes of one series from the Notes of all other series;
<PAGE>
(b) the Notes of each series shall rank pari passu with each other
series of the Notes and with the Company's other outstanding senior
unsecured Indebtedness;
(c) each series of Notes shall be dated the date of issue, bear
interest at such rate or rates, mature on such date or dates, be subject to
such mandatory prepayments on the dates and with the Make-Whole Amounts, if
any, as are provided in the Supplement under which such Notes are issued,
and shall have such additional or different conditions precedent to closing
and such additional or different representations and warranties or, subject
to Section 1.1(d), other terms and provisions as shall be specified in such
Supplement;
(d) any additional covenants, Defaults, Events of Default, rights or
similar provisions that are added by a Supplement for the benefit of the
series of Notes to be issued pursuant to such Supplement shall apply to all
outstanding Notes, whether or not the Supplement so provides; and
(e) except to the extent provided in foregoing clause (c), all of the
provisions of this Agreement shall apply to the Notes of each series.
The Purchasers of the Series 1999-A Notes need not purchase subsequent series of
Notes.
1.2. The Series 1999-A Notes.
The Company has authorized, as the initial series of Notes hereunder,
the issue and sale of $107,000,000 aggregate principal amount of Notes to be
designated as its 6.62% Senior Notes, Series 1999-A, due May 30, 2011 (the
"Series 1999-A Notes," such term to include any such Notes issued in
substitution therefor pursuant to Section 13 of this Agreement). The Series
1999-A Notes shall be substantially in the form set out in Exhibit 1.2, with
such changes therefrom, if any, as may be approved by you and the Company.
2. SALE AND PURCHASE OF SERIES 1999-A NOTES.
Subject to the terms and conditions of this Agreement, the Company
will issue and sell to you and each of the other purchasers named in Schedule A
(the "Other Purchasers"), and you and the Other Purchasers will purchase from
the Company, at the Closing provided for in Section 3, Series 1999-A Notes in
the series and principal amount specified opposite your names in Schedule A at
the purchase price of 100% of the principal amount thereof. Your obligation
hereunder and the obligations of the Other Purchasers are several and not joint
obligations and you shall have no liability to any Person for the performance or
non-performance by any Other Purchaser hereunder.
3. CLOSING.
The sale and purchase of the Series 1999-A Notes to be purchased by
you and the Other Purchasers shall occur at the offices of Gardner, Carton &
Douglas, Quaker Tower, Suite 3400, 321 North Clark Street, Chicago, Illinois
60610 at 9:00 a.m., Chicago time, at a closing (the "Closing") on May 28, 1999
or on such other Business Day thereafter on or prior to June 15, 1999 as may be
agreed upon by the Company and you and the Other Purchasers. At the
2
<PAGE>
Closing the Company will deliver to you the Series 1999-A Notes to be purchased
by you in the form of a single Series 1999-A Note (or such greater number of
Series 1999-A Notes in denominations of at least $500,000 as you may request)
dated the date of the Closing and registered in your name (or in the name of
your nominee), against delivery by you to the Company or its order of
immediately available funds in the amount of the purchase price therefor by wire
transfer of immediately available funds for the account of the Company to
account number 8188-9-00150 at Bank of America, 231 South LaSalle, Chicago, IL
60697, ABA #071000039. If at the Closing the Company shall fail to tender such
Series 1999-A Notes to you as provided above in this Section 3, or any of the
conditions specified in Section 4 shall not have been fulfilled to your
satisfaction, you shall, at your election, be relieved of all further
obligations under this Agreement, without thereby waiving any rights you may
have by reason of such failure or such nonfulfillment.
4. CONDITIONS TO CLOSING.
Your obligation to purchase and pay for the Series 1999-A Notes to be
sold to you at the Closing is subject to the fulfillment to your satisfaction,
prior to or at the Closing, of the following conditions:
4.1. Representations and Warranties.
The representations and warranties of the Company in this Agreement
shall be correct when made and at the time of the Closing.
4.2. Performance; No Default.
The Company shall have performed and complied with all agreements and
conditions contained in this Agreement required to be performed or complied with
by it prior to or at the Closing and after giving effect to the issue and sale
of the Series 1999-A Notes (and the application of the proceeds thereof as
contemplated by Schedule 5.14) no Default or Event of Default shall have
occurred and be continuing. Neither the Company nor any Subsidiary shall have
entered into any transaction since March 31, 1999 that would have been
prohibited by Sections 10.1 through 10.8 had such Sections applied since such
date.
4.3. Compliance Certificates.
(a) Officer's Certificate. The Company shall have delivered to you an
---------------------
Officer's Certificate, dated the date of the Closing, certifying that the
conditions specified in Sections 4.1, 4.2 and 4.9 have been fulfilled.
(b) Secretary's Certificate. The Company shall have delivered to you
-----------------------
a certificate certifying as to the resolutions attached thereto and other
corporate proceedings relating to the authorization, execution and delivery
of the Series 1999-A Notes and the Agreement.
3
<PAGE>
4.4. Opinions of Counsel.
You shall have received opinions in form and substance satisfactory to
you, dated the date of the Closing (a) from Sidley & Austin, counsel for the
Company, covering the matters set forth in Exhibit 4.4(a) and covering such
other matters incident to the transactions contemplated hereby as you or your
counsel may reasonably request (and the Company instructs its counsel to deliver
such opinion to you) and (b) from Gardner, Carton & Douglas, your special
counsel in connection with such transactions, substantially in the form set
forth in Exhibit 4.4(b) and covering such other matters incident to such
transactions as you may reasonably request.
4.5. Purchase Permitted By Applicable Law, etc.
On the date of the Closing your purchase of Series 1999-A Notes shall
(i) be permitted by the laws and regulations of each jurisdiction to which you
are subject, without recourse to provisions (such as Section 1405(a)(8) of the
New York Insurance Law) permitting limited investments by insurance companies
without restriction as to the character of the particular investment, (ii) not
violate any applicable law or regulation (including, without limitation,
Regulation T, U or X of the Board of Governors of the Federal Reserve System)
and (iii) not subject you to any tax, penalty or liability under or pursuant to
any applicable law or regulation, which law or regulation was not in effect on
the date hereof. If requested by you, you shall have received an Officer's
Certificate certifying as to such matters of fact as you may reasonably specify
to enable you to determine whether such purchase is so permitted.
4.6. Sale of Other Series 1999-A Notes.
Contemporaneously with the Closing the Company shall sell to the Other
Purchasers and the Other Purchasers shall purchase the Series 1999-A Notes to be
purchased by them at the Closing as specified in Schedule A.
4.7. Payment of Special Counsel Fees.
Without limiting the provisions of Section 15.1, the Company shall
have paid on or before the Closing the fees, charges and disbursements of your
special counsel referred to in Section 4.4, to the extent reflected in a
statement of such counsel rendered to the Company at least one Business Day
prior to the Closing.
4.8. Private Placement Number.
A Private Placement number issued by Standard & Poor's CUSIP Service
Bureau (in cooperation with the Securities Valuation Office of the National
Association of Insurance Commissioners) shall have been obtained for the Series
1999-A Notes by Gardner, Carton & Douglas.
4.9. Changes in Corporate Structure.
Except as specified in Schedule 4.9, the Company shall not have
changed its jurisdiction of incorporation or been a party to any merger or
consolidation and shall not have
4
<PAGE>
succeeded to all or any substantial part of the liabilities of any other entity,
at any time following the date of the most recent financial statements referred
to in Schedule 5.5.
4.10. Proceedings and Documents.
All corporate and other proceedings in connection with the
transactions contemplated by this Agreement and all documents and instruments
incident to such transactions shall be satisfactory to you and your special
counsel, and you and your special counsel shall have received all such
counterpart originals or certified or other copies of such documents as you or
they may reasonably request.
5. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.
The Company represents and warrants to you that:
5.1. Organization; Power and Authority.
The Company is a corporation duly organized, validly existing and in
good standing under the laws of its jurisdiction of incorporation, and is duly
qualified as a foreign corporation and is in good standing in each jurisdiction
in which such qualification is required by law, other than those jurisdictions
as to which the failure to be so qualified or in good standing would not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect. The Company has the corporate power and authority to own or
hold under lease the properties it purports to own or hold under lease, to
transact the business it transacts and proposes to transact, to execute and
deliver this Agreement and the Series 1999-A Notes and to perform the provisions
hereof and thereof.
5.2. Authorization, etc.
This Agreement and the Series 1999-A Notes have been duly authorized
by all necessary corporate action on the part of the Company, and this Agreement
constitutes, and upon execution and delivery thereof each Series 1999-A Note
will constitute, a legal, valid and binding obligation of the Company
enforceable against the Company in accordance with its terms, except as such
enforceability may be limited by (i) applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting the enforcement of
creditors' rights generally and (ii) general principles of equity (regardless of
whether such enforceability is considered in a proceeding in equity or at law).
5.3. Disclosure.
The Company, through its agent, Banc of America Securities LLC, has
delivered to you and each Other Purchaser a copy of a Private Placement
Memorandum, dated April 1999 (the "Memorandum"), relating to the transactions
contemplated hereby. The Memorandum fairly describes, in all material respects,
the general nature of the business of the Company and its Subsidiaries. Except
as disclosed in Schedule 5.3, this Agreement, the Memorandum, including the
exhibits to the Memorandum, and the documents delivered to you by the Company at
the Closing and the financial statements listed in Schedule 5.5, taken as a
whole, do not
5
<PAGE>
contain any untrue statement of a material fact or omit to state any material
fact necessary in order to make the statements therein not misleading in light
of the circumstances under which they were made. Except as disclosed in the
Memorandum or as expressly described in Schedule 5.3, or in one of the documents
identified therein, or in the financial statements listed in Schedule 5.5, since
December 31, 1998, there has been no change in the financial condition,
operations, business or properties of the Company or any Subsidiary except
changes that individually or in the aggregate would not reasonably be expected
to have a Material Adverse Effect. There is no fact known to the Company that
would reasonably be expected to have a Material Adverse Effect that has not been
set forth herein or in the Memorandum or in the other documents delivered to you
by the Company specifically for use in connection with the transactions
contemplated hereby.
5.4. Organization and Ownership of Shares of Subsidiaries; Affiliates.
(a) Schedule 5.4 contains (except as noted therein) complete and
correct lists (i) of the Company's Subsidiaries, showing, as to each
Subsidiary, the correct name thereof, the jurisdiction of its organization,
and the percentage of shares of each class of its capital stock or similar
equity interests outstanding owned by the Company and each other
Subsidiary, (ii) of the Company's Affiliates, other than Subsidiaries, and
(iii) of the Company's directors and executive officers. Each Subsidiary
listed in Schedule 5.4 is designated a Restricted Subsidiary by the
Company.
(b) All of the outstanding shares of capital stock or similar equity
interests of each Subsidiary shown in Schedule 5.4 as being owned by the
Company and its Subsidiaries have been validly issued, are fully paid and
nonassessable and are owned by the Company or another Subsidiary free and
clear of any Lien (except as otherwise permitted by Section 10.3).
(c) Each Subsidiary identified in Schedule 5.4 is a corporation or
other legal entity duly organized, validly existing and in good standing
under the laws of its jurisdiction of organization, and is duly qualified
as a foreign corporation or other legal entity and is in good standing in
each jurisdiction in which such qualification is required by law, other
than those jurisdictions as to which the failure to be so qualified or in
good standing would not, individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect. Each such Subsidiary has the
corporate or other power and authority to own or hold under lease the
properties it purports to own or hold under lease and to transact the
business it transacts and proposes to transact.
(d) No Subsidiary is a party to, or otherwise subject to any legal
restriction or any agreement (other than this Agreement, the agreements
listed on Schedule 5.4 and customary limitations imposed by corporate law
statutes) restricting the ability of such Restricted Subsidiary to pay
dividends out of profits or make any other similar distributions of profits
to the Company or any of its Subsidiaries that owns outstanding shares of
capital stock or similar equity interests of such Subsidiary.
6
<PAGE>
5.5. Financial Statements.
The Company has delivered to you and each Other Purchaser copies of
the financial statements of the Company and its Subsidiaries listed on Schedule
5.5. All of said financial statements (including in each case the related
schedules and notes) fairly present in all material respects the consolidated
financial condition of the Company and its Subsidiaries as of the respective
dates specified in such Schedule and the consolidated results of their
operations and cash flows for the respective periods so specified and have been
prepared in accordance with GAAP consistently applied throughout the periods
involved except as set forth in the notes thereto (subject, in the case of any
interim financial statements, to normal year-end adjustments).
5.6. Compliance with Laws, Other Instruments, etc.
The execution, delivery and performance by the Company of this
Agreement and the Series 1999-A Notes will not (i) contravene, result in any
breach of, or constitute a default under, or result in the creation of any Lien
in respect of any property of the Company or any Subsidiary under, any Material
indenture, mortgage, deed of trust, loan, purchase or credit agreement, lease,
corporate charter or by-laws, or any other Material agreement or instrument to
which the Company or any Subsidiary is bound or by which any of their respective
properties may be bound or affected, (ii) violate or result in a breach of any
of the terms, conditions or provisions of any order, judgment, decree, or ruling
of any court, arbitrator or Governmental Authority applicable to the Company or
any Subsidiary or (iii) violate any provision of any statute or other rule or
regulation of any Governmental Authority applicable to the Company or any
Subsidiary other than violations that would not reasonably be expected to have a
Material Adverse Effect.
5.7. Governmental Authorizations, etc.
No consent, approval or authorization of, or registration, filing or
declaration with, any Governmental Authority is required in connection with the
execution, delivery or performance by the Company of this Agreement or the
Series 1999-A Notes.
5.8. Litigation; Observance of Agreements, Statutes and Orders.
(a) Except as disclosed in Schedule 5.8, there are no actions, suits
or proceedings pending or, to the knowledge of the Company, threatened
against or affecting the Company or any Subsidiary or any property of the
Company or any Subsidiary in any court or before any arbitrator of any kind
or before or by any Governmental Authority that, individually or in the
aggregate, would reasonably be expected to have a Material Adverse Effect.
(b) Neither the Company nor any Subsidiary is in default under any
term of any agreement or instrument to which it is a party or by which it
is bound, or any order, judgment, decree or ruling of any court, arbitrator
or Governmental Authority or is in violation of any applicable law,
ordinance, rule or regulation (including Environmental Laws) of any
Governmental Authority, which default or violation, individually or in the
aggregate, would reasonably be expected to have a Material Adverse Effect.
7
<PAGE>
5.9. Taxes.
The Company and its Subsidiaries have filed all income tax returns and
other material tax returns that are required to have been filed in any
jurisdiction, and have paid all taxes shown to be due and payable on such
returns and all other taxes and assessments levied upon them or their
properties, assets, income or franchises, to the extent such taxes and
assessments have become due and payable and before they have become delinquent,
except for any taxes and assessments (i) the amount of which is not individually
or in the aggregate Material or (ii) the amount, applicability or validity of
which is currently being contested in good faith by appropriate proceedings and
with respect to which the Company or a Subsidiary, as the case may be, has
established adequate reserves in accordance with GAAP. The Company knows of no
basis for any other tax or assessment that would reasonably be expected to have
a Material Adverse Effect. The charges, accruals and reserves on the books of
the Company and its Subsidiaries in respect of Federal, state or other taxes for
all fiscal periods are adequate under GAAP. The Federal income tax liabilities
of the Company and its Subsidiaries have been determined by the Internal Revenue
Service and paid for all fiscal years up to and including the fiscal year ended
December 31, 1994.
5.10. Title to Property; Leases.
The Company and its Subsidiaries have good and sufficient title to the
properties that they own or purport to own and that individually or in the
aggregate are Material, including all such properties reflected in the most
recent audited balance sheet referred to in Section 5.5 or purported to have
been acquired by the Company or any Subsidiary after said date (except as sold
or otherwise disposed of in the ordinary course of business), in each case free
and clear of Liens prohibited by this Agreement. All leases that individually
or in the aggregate are Material are valid and subsisting and are in full force
and effect in all material respects.
5.11. Licenses, Permits, etc.
Except as disclosed in Schedule 5.11,
(a) the Company and its Subsidiaries own or possess all licenses,
permits, franchises, authorizations, patents, copyrights, service marks,
trademarks and trade names, or rights thereto, that individually or in the
aggregate are Material, without known material conflict with the rights of
others;
(b) to the knowledge of the Company, no product of the Company
infringes in any material respect any license, permit, franchise,
authorization, patent, copyright, service mark, trademark, trade name or
other right owned by any other Person; and
(c) to the knowledge of the Company, there is no Material violation by
any Person of any right of the Company or any of its Subsidiaries with
respect to any patent, copyright, service mark, trademark, trade name or
other right owned or used by the Company or any of its Subsidiaries.
8
<PAGE>
5.12. Compliance with ERISA.
(a) The Company and each ERISA Affiliate have operated and
administered each Plan in compliance with all applicable laws except for
such instances of noncompliance as have not resulted in and would not
reasonably be expected to result in a Material Adverse Effect. Neither the
Company nor any ERISA Affiliate has incurred any liability pursuant to
Title I or IV of ERISA or the penalty or excise tax provisions of the Code
relating to employee benefit plans (as defined in Section 3 of ERISA), and
no event, transaction or condition has occurred or exists that would
reasonably be expected to result in the incurrence of any such liability
by the Company or any ERISA Affiliate, or in the imposition of any Lien on
any of the rights, properties or assets of the Company or any ERISA
Affiliate, in either case pursuant to Title I or IV of ERISA or to such
penalty or excise tax provisions or to Section 401(a)(29) or 412 of the
Code, other than such liabilities or Liens as would not be individually or
in the aggregate Material.
(b) The present value of the aggregate benefit liabilities under each
of the Plans (other than Multiemployer Plans), determined as of the end of
such Plan's most recently ended plan year on the basis of the actuarial
assumptions used to determine the actuarial accrued liability on an on-
going funding basis in such Plan's most recent actuarial valuation report,
did not exceed the aggregate current value of the assets of such Plan
allocable to such benefit liabilities. The term "benefit liabilities" has
the meaning specified in section 4001 of ERISA and the terms "current
value" and "present value" have the meaning specified in section 3 of
ERISA.
(c) The Company and its ERISA Affiliates have not incurred withdrawal
liabilities (and are not subject to contingent withdrawal liabilities)
under section 4201 or 4204 of ERISA in respect of Multiemployer Plans that
have not been paid, or if contingent, that individually or in the aggregate
are Material.
(d) The expected postretirement benefit obligation (determined as of
the last day of the Company's most recently ended fiscal year in
accordance with Financial Accounting Standards Board Statement No. 106, as
amended by Financial Accounting Standards Board Statement No. 132, without
regard to liabilities attributable to continuation coverage mandated by
section 4980B of the Code) of the Company and its Subsidiaries is not
Material or has been disclosed in the most recent audited consolidated
financial statements of the Company and its Subsidiaries.
(e) The execution and delivery of this Agreement and the issuance and
sale of the Series 1999-A Notes hereunder will not involve any transaction
that is subject to the prohibitions of section 406 of ERISA or in
connection with which a tax could be imposed pursuant to section
4975(c)(1)(A)-(D) of the Code. The representation by the Company in the
first sentence of this Section 5.12(e) is made in reliance upon and
subject to the accuracy of your representation in Section 6.2 as to the
sources of the funds used to pay the purchase price of the Series 1999-A
Notes to be purchased by you.
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5.13. Private Offering by the Company.
Neither the Company nor anyone acting on its behalf has offered the
Series 1999-A Notes or any similar securities for sale to, or solicited any
offer to buy any of the same from, or otherwise approached or negotiated in
respect thereof with, any person other than you, the Other Purchasers and not
more than 40 other Institutional Investors, each of which has been offered the
Series 1999-A Notes at a private sale for investment. Neither the Company nor
anyone acting on its behalf has taken, or will take, any action that would
subject the issuance or sale of the Series 1999-A Notes to the registration
requirements of Section 5 of the Securities Act.
5.14. Use of Proceeds; Margin Regulations.
The Company will apply the proceeds of the sale of the Series 1999-A
Notes for acquisitions and general corporate purposes, including to repay
Indebtedness of the Company and its Subsidiaries as set forth in Schedule 5.14.
No part of the proceeds from the sale of the Series 1999-A Notes hereunder will
be used, directly or indirectly, for the purpose of buying or carrying any
margin stock within the meaning of Regulation U of the Board of Governors of the
Federal Reserve System (12 CFR 221), or for the purpose of buying or carrying or
trading in any securities under such circumstances as to involve the Company in
a violation of Regulation X of said Board (12 CFR 224) or to involve any broker
or dealer in a violation of Regulation T of said Board (12 CFR 220). Margin
stock does not constitute more than 1.0% of the value of the consolidated assets
of the Company and its Subsidiaries and the Company does not have any present
intention that margin stock will constitute more than 1.0% of the value of such
assets. As used in this Section, the terms "margin stock" and "purpose of
buying or carrying" shall have the meanings assigned to them in said Regulation
U. For purposes of the foregoing, margin stock shall not include common stock
of the Company held in its treasury.
5.15. Existing Indebtedness; Future Liens.
(a) Except as described therein, Schedule 5.15 sets forth a complete
and correct list of all outstanding Indebtedness of the Company and its
Subsidiaries as of March 31, 1999, since which date there has been no
Material change in the amounts, interest rates, sinking funds,
installment payments or maturities of the Indebtedness of the Company or
Subsidiaries. Neither the Company nor any Subsidiary is in default and no
waiver of default is currently in effect, in the payment of any principal
or interest on any Indebtedness of the Company or such Subsidiary that is
outstanding in an aggregate principal amount in excess of $2,000,000 and
no event or condition exists with respect to any Indebtedness of the
Company or any Subsidiary that is outstanding in an aggregate principal
amount in excess of $2,000,000 and that would permit (or that with notice
or the lapse of time, or both, would permit) one or more Persons to cause
such Indebtedness to become due and payable before its stated maturity or
before its regularly scheduled dates of payment.
(b) Except as disclosed in Schedule 5.15, neither the Company nor
any Subsidiary has agreed or consented to cause or permit in the future
(upon the happening
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of a contingency or otherwise) any of its property, whether now owned or
hereafter acquired, to be subject to a Lien not permitted by Section
10.3.
5.16. Foreign Assets Control Regulations, etc.
Neither the sale of the Series 1999-A Notes by the Company hereunder
nor its use of the proceeds thereof will violate the Trading with the Enemy Act,
as amended, or any of the foreign assets control regulations of the United
States Treasury Department (31 CFR, Subtitle B, Chapter V, as amended) or any
enabling legislation or executive order relating thereto.
5.17. Status under Certain Statutes.
Neither the Company nor any Subsidiary is subject to regulation under
the Investment Company Act of 1940, as amended, the Public Utility Holding
Company Act of 1935, as amended, the Interstate Commerce Act, as amended by the
ICC Termination Act, as amended, or the Federal Power Act, as amended.
5.18. Environmental Matters.
Neither the Company nor any Subsidiary has knowledge of any claim or
has received any notice of any claim, and no proceeding has been instituted
asserting any claim against the Company or any of its Subsidiaries or any of
their respective real properties now owned, leased or operated by any of them or
other assets nor, to the knowledge of the Company or any Subsidiary, has any
such proceeding been instituted against any of their respective real properties
formerly owned, for damage to the environment or violation of any Environmental
Laws, except, in each case, such as would not reasonably be expected to result
in a Material Adverse Effect. Except as otherwise disclosed to you in writing,
(a) neither the Company nor any Subsidiary has knowledge of any facts
that would give rise to any claim, for violation of Environmental Laws or
damage to the environment emanating from, occurring on or in any way
related to real properties now or, to the Company's or such Subsidiary's
knowledge, formerly owned, leased or operated by any of them or to other
assets or their use, except, in each case, such as would not reasonably
be expected to result in a Material Adverse Effect;
(b) neither the Company nor any Subsidiary has stored any Hazardous
Materials on real properties now or formerly owned, leased or operated by
any of them and has not disposed of any Hazardous Materials in a manner
contrary to any Environmental Laws in each case in any manner that would
reasonably be expected to result in a Material Adverse Effect; and
(c) all buildings on all real properties now owned, leased or operated
by the Company or any of its Subsidiaries are in compliance with
applicable Environmental Laws, except where failure to comply would not
reasonably be expected to result in a Material Adverse Effect.
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5.19. Year 2000.
The Company and its Subsidiaries have conducted a review and
assessment of their computer applications and inquired of their material
suppliers, vendors and customers regarding the "Year 2000 Problem" (i.e., the
risk that computer applications may be unable to recognize and perform properly
date-sensitive functions involving certain dates prior to and any date after
December 31, 1999). Based upon such review, assessment and inquiry, the Company
reasonably believes that the Year 2000 Problem will not have a Material Adverse
Effect.
6. REPRESENTATIONS OF THE PURCHASERS.
6.1. Purchase for Investment.
You represent that you are purchasing the Series 1999-A Notes to be
purchased by you for your own account or for one or more separate accounts
maintained by you or for the account of one or more pension or trust funds and
not with a view to the distribution thereof, provided that the disposition of
--------
your or their property shall at all times be within your or their control. You
understand that the Series 1999-A Notes to be purchased by you have not been
registered under the Securities Act and may be resold only if registered
pursuant to the provisions of the Securities Act or if an exemption from
registration is available, except under circumstances where neither such
registration nor such an exemption is required by law, and that the Company is
not required to register the Series 1999-A Notes.
6.2. Source of Funds.
You represent that at least one of the following statements is an
accurate representation as to each source of funds (a "Source") to be used by
you to pay the purchase price of the Series 1999-A Notes to be purchased by you
hereunder:
(a) if you are an insurance company, the Source does not include
assets allocated to any separate account maintained by you in which any
employee benefit plan (or its related trust) has any interest, other than
a separate account that is maintained solely in connection with your fixed
contractual obligations under which the amounts payable, or credited, to
such plan and to any participant or beneficiary of such plan (including
any annuitant) are not affected in any manner by the investment
performance of the separate account; or
(b) the Source is either (i) an insurance company pooled separate
account, within the meaning of Prohibited Transaction Exemption ("PTE")
90-1 (issued January 29, 1990), or (ii) a bank collective investment fund,
within the meaning of the PTE 91-38 (issued July 12, 1991) and, except as
you have disclosed to the Company in writing pursuant to this paragraph
(b), no employee benefit plan or group of plans maintained by the same
employer or employee organization beneficially owns more than 10% of all
assets allocated to such pooled separate account or collective investment
fund; or
(c) the Source constitutes assets of an "investment fund" (within the
meaning of Part V of the QPAM Exemption) managed by a "qualified
professional asset manager"
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or "QPAM" (within the meaning of Part V of the QPAM Exemption), no employee
benefit plan's assets that are included in such investment fund, when
combined with the assets of all other employee benefit plans established or
maintained by the same employer or by an affiliate (within the meaning of
Section V(c)(1) of the QPAM Exemption) of such employer or by the same
employee organization and managed by such QPAM, exceed 20% of the total
client assets managed by such QPAM, the conditions of Part I(c) and (g) of
the QPAM Exemption are satisfied, neither the QPAM nor a person controlling
or controlled by the QPAM (applying the definition of "control" in Section
V(e) of the QPAM Exemption) owns a 5% or more interest in the Company and
(i) the identity of such QPAM and (ii) the names of all employee benefit
plans whose assets are included in such investment fund have been disclosed
to the Company in writing pursuant to this paragraph (c); or
(d) the Source is a governmental plan; or
(e) the Source is one or more employee benefit plans, or a separate
account or trust fund comprised of one or more employee benefit plans, each
of which has been identified to the Company in writing pursuant to this
paragraph (e); or
(f) the Source does not include assets of any employee benefit plan,
other than a plan exempt from the coverage of ERISA; or
(g) the Source is an "insurance company general account" as such term
is defined in the Department of Labor Prohibited Transaction Class
Exemption 95-60 (issued July 12, 1995) ("PTE 95-60") and there is no
"employee benefit plan" with respect to which the aggregate amount of such
general account's reserves and liabilities for the contracts held by or on
behalf of such employee benefit plan and all other employee benefit plans
maintained by the same employer (and affiliates thereof as defined in
Section V(a)(1) of PTE 95-60) or by the same employee organization (in each
case determined in accordance with the provisions of PTE 95-60) exceeds 10%
of the total reserves and liabilities of such general account (as
determined under PTE 95-60) (exclusive of separate account liabilities)
plus surplus as set forth in the National Association of Insurance
Commissioners Annual Statement filed with the state of domicile of such
Purchaser.
As used in this Section 6.2, the terms "employee benefit plan", "governmental
plan", "party in interest" and "separate account" shall have the respective
meanings assigned to such terms in Section 3 of ERISA.
7. INFORMATION AS TO COMPANY.
7.1. Financial and Business Information
The Company shall deliver to each holder of Notes that is an
Institutional Investor:
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(a) Quarterly Statements -- within 60 days after the end of each
--------------------
quarterly fiscal period in each fiscal year of the Company (other than the
last quarterly fiscal period of each such fiscal year), duplicate copies
of,
(i) a consolidated balance sheet of the Company and its
Subsidiaries as at the end of such quarter, and
(ii) consolidated statements of income, changes in equity and
cash flows of the Company and its Subsidiaries, for such quarter and
(in the case of the second and third quarters) for the portion of the
fiscal year ending with such quarter,
setting forth in each case in comparative form the figures for the
corresponding periods in the previous fiscal year, all in reasonable
detail, prepared in accordance with GAAP applicable to quarterly financial
statements generally, and certified by a Senior Financial Officer as fairly
presenting, in all material respects, the consolidated financial condition
of the Company and its Subsidiaries as of the specified dates being
reported on and their consolidated results of operations and cash flows for
the respective periods specified, subject to changes resulting from year-
end adjustments, provided that delivery within the time period specified
--------
above of copies of the Company's Quarterly Report on Form 10-Q prepared in
compliance with the requirements therefor and filed with the Securities and
Exchange Commission shall be deemed to satisfy the requirements of this
Section 7.1(a);
(b) Annual Statements -- within 120 days after the end of each fiscal
-----------------
year of the Company, duplicate copies of,
(i) a consolidated balance sheet of the Company and its
Subsidiaries, as at the end of such year, and
(ii) consolidated statements of income, changes in equity and
cash flows of the Company and its Subsidiaries, for such year,
setting forth in each case in comparative form the figures for the previous
fiscal year, all in reasonable detail, prepared in accordance with GAAP,
and accompanied by an opinion thereon of independent certified public
accountants of recognized national standing, which opinion shall state that
such financial statements present fairly, in all material respects, the
consolidated financial condition of the Company and its Subsidiaries as of
the specified dates being reported upon and their consolidated results of
operations and cash flows for the respective periods specified and have
been prepared in conformity with GAAP, and that the examination of such
accountants in connection with such financial statements has been made in
accordance with generally accepted auditing standards, and that such audit
provides a reasonable basis for such opinion in the circumstances, provided
--------
that the delivery within the time period specified above of the Company's
Annual Report on Form 10-K for such fiscal year (or the Company's annual
report to stockholders, if any, prepared pursuant to Rule 14a-3 under the
Exchange Act) prepared in accordance with the requirements therefor and
filed with the Securities and Exchange
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Commission, together with such accountant's opinion, shall be deemed to
satisfy the requirements of this Section 7.1(b);
(c) Unrestricted Subsidiaries -- if, at the time of delivery of any
-------------------------
financial statements pursuant to Section 7.1(a) or (b), Unrestricted
Subsidiaries account for more than 10% of (i) the consolidated total assets
of the Company and its Subsidiaries reflected in the balance sheet included
in such financial statements or (ii) the consolidated net sales of the
Company and its Subsidiaries reflected in the consolidated statement of
income included in such financial statements, an unaudited balance sheet
for all Unrestricted Subsidiaries taken as whole as at the end of the
fiscal period included in such financial statements and the related
unaudited statements of income, equity and cash flows for such Unrestricted
Subsidiaries for such period, together with consolidating statements
reflecting all eliminations or adjustments necessary to reconcile such
group financial statements to the consolidated financial statements of the
Company and its Subsidiaries, certified by a Senior Financial Officer as
fairly presenting, in all material respects, the financial position of the
companies being reported on as of the date specified and their results of
operations and cash flows for the periods specified, subject, in the case
of financial statements delivered pursuant to Section 7.1(a), to changes
resulting from year-end adjustments;
(d) SEC and Other Reports -- promptly upon their becoming available,
---------------------
one copy of each regular or periodic report, each registration statement
(without exhibits except as expressly requested by such holder), and each
prospectus and all amendments thereto containing information of a financial
nature filed by the Company or any Restricted Subsidiary with the
Securities and Exchange Commission and of all press releases and other
statements concerning a Material development made available generally by
the Company or any Restricted Subsidiary to the public;
(e) Notice of Default or Event of Default -- promptly, and in any
-------------------------------------
event within five Business Days after a Responsible Officer obtains actual
knowledge of the existence of any Default or Event of Default or that any
Person has given any notice or taken any action with respect to a claimed
default hereunder or that any Person has given any notice or taken any
action with respect to a claimed default of the type referred to in Section
11(f), a written notice specifying the nature and period of existence
thereof and what action the Company is taking or proposes to take with
respect thereto;
(f) ERISA Matters -- promptly, and in any event within five days after
-------------
a Responsible Officer becoming aware of any of the following, a written
notice setting forth the nature thereof and the action, if any, that the
Company or an ERISA Affiliate proposes to take with respect thereto:
(i) with respect to any Plan, any reportable event, as defined in
section 4043(b) of ERISA and the regulations thereunder, for which
notice thereof has not been waived pursuant to such regulations as in
effect on the date hereof; or
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(ii) the taking by the PBGC of steps to institute, or the
threatening by the PBGC of the institution of, proceedings under
section 4042 of ERISA for the termination of, or the appointment of a
trustee to administer, any Plan, or the receipt by the Company or any
ERISA Affiliate of a notice from a Multiemployer Plan that such action
has been taken by the PBGC with respect to such Multiemployer Plan; or
(iii) any event, transaction or condition that could result in
the incurrence of any liability by the Company or any ERISA Affiliate
pursuant to Title I or IV of ERISA or the penalty or excise tax
provisions of the Code relating to employee benefit plans, or in the
imposition of any Lien on any of the rights, properties or assets of
the Company or any ERISA Affiliate pursuant to Title I or IV of ERISA
or such penalty or excise tax provisions, if such liability or Lien,
taken together with any other such liabilities or Liens then existing,
would reasonably be expected to have a Material Adverse Effect;
(g) Notices from Governmental Authority -- promptly, and in any event
-----------------------------------
within 30 days of receipt thereof, copies of any notice to the Company or
any Restricted Subsidiary from any Federal or state Governmental Authority
relating to any order, ruling, statute or other law or regulation that
would reasonably be expected to have a Material Adverse Effect;
(h) Requested Information -- with reasonable promptness, such other
---------------------
data and information relating to the business, operations, affairs,
financial condition, assets or properties of the Company or any of its
Subsidiaries or relating to the ability of the Company to perform its
obligations hereunder and under the Notes as from time to time may be
reasonably requested by any such holder of Notes; and
(i) Supplements to Agreement -- in the event an additional series of
------------------------
Notes is, or is proposed to be, issued under this Agreement, promptly, and
in any event within 10 Business Days after execution and delivery thereof,
a true copy of the Supplement pursuant to which such Notes are to be, or
were, issued.
7.2. Officer's Certificate.
Each set of financial statements delivered to a holder of Notes
pursuant to Section 7.1(a) or (b) shall be accompanied by a certificate of a
Senior Financial Officer setting forth:
(a) Covenant Compliance -- the information (including detailed
-------------------
calculations) required in order to establish whether the Company was in
compliance with the requirements of Section 10.1 through Section 10.5,
inclusive, during the quarterly or annual period covered by the statements
then being furnished (including with respect to each such Section, where
applicable, the calculations of the maximum or minimum amount, ratio or
percentage, as the case may be, permissible under the terms of such
Sections, and the calculation of the amount, ratio or percentage then in
existence); and
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(b) Event of Default -- a statement that such officer has reviewed the
----------------
relevant terms hereof and has made, or caused to be made, under his or her
supervision, a review of the transactions and conditions of the Company and
its Restricted Subsidiaries from the beginning of the quarterly or annual
period covered by the statements then being furnished to the date of the
certificate and that such review shall not have disclosed the existence
during such period of any condition or event that constitutes a Default or
an Event of Default or, if any such condition or event existed or exists
(including any such event or condition resulting from the failure of the
Company or any Restricted Subsidiary to comply with any Environmental Law),
specifying the nature and period of existence thereof and what action the
Company shall have taken or proposes to take with respect thereto.
7.3. Inspection.
The Company will permit the representatives of each holder of Notes
that is an Institutional Investor:
(a) No Default -- if no Default or Event of Default then exists, at
----------
the expense of such holder and upon reasonable prior notice to the Company,
to visit the principal executive office of the Company, to discuss the
affairs, finances and accounts of the Company and its Restricted
Subsidiaries with the Company's officers and (with the consent of the
Company, which consent will not be unreasonably withheld) to visit the
other offices and properties of the Company and each Restricted Subsidiary,
all at such reasonable times during business hours and as often as may be
reasonably requested in writing; and
(b) Default -- if a Default or Event of Default then exists, at the
-------
expense of the Company and upon reasonable prior notice to the Company, to
visit the principal executive office of the Company or any Restricted
Subsidiary, to examine all their respective books of account, records,
reports and other papers, to make copies and extracts therefrom, and to
discuss their respective affairs, finances and accounts with their
respective officers, and (with the consent of the Company, which consent
will not be unreasonably withheld) independent public accountants at the
Company's offices, all at such reasonable times during business hours and
as often as may be reasonably requested in writing.
8. PREPAYMENT OF THE SERIES 1999-A NOTES.
8.1. Required Prepayments.
The Series 1999-A Notes are subject to required prepayment on May 30,
2007 and on each May 30 thereafter to and including May 30, 2010, on which dates
the Company will prepay $21,400,000 principal amount (or such lesser principal
amount as shall then be outstanding) of the Series 1999-A Notes, at par, without
payment of the Make-Whole Amount or any premium.
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8.2. Optional Prepayments with Make-Whole Amount.
The Company may, at its option, upon notice as provided below, prepay
at any time all, or from time to time any part of, the Notes of any series,
including the Series 1999-A Notes, in an amount not less than $2,000,000 in the
aggregate in the case of a partial prepayment, at 100% of the principal amount
so prepaid, plus the Make-Whole Amount determined for the prepayment date with
respect to such principal amount. The Company will give each holder of Notes of
the series to be prepaid written notice of each optional prepayment under this
Section 8.2 not less than 30 days and not more than 60 days prior to the date
fixed for such prepayment. Each such notice shall specify such date, the
aggregate principal amount of the Notes to be prepaid on such date, the
principal amount of each Note held by such holder to be prepaid (determined in
accordance with Section 8.3), and the interest to be paid on the prepayment date
with respect to such principal amount being prepaid, and shall be accompanied by
a certificate of a Senior Financial Officer as to the estimated Make-Whole
Amount due in connection with such prepayment (calculated as if the date of such
notice were the date of the prepayment), setting forth the details of such
computation. Two Business Days prior to such prepayment, the Company shall
deliver to each holder of Notes of the series to be prepaid a certificate of a
Senior Financial Officer specifying the calculation of such Make-Whole Amount as
of the specified prepayment date.
8.3. Allocation of Partial Prepayments.
In the case of each partial prepayment of the Notes of a series, the
principal amount of the Notes to be prepaid shall be allocated among all of the
Notes of such series at the time outstanding in proportion, as nearly as
practicable, to the respective unpaid principal amounts thereof not theretofore
called for prepayment. Each such partial prepayment pursuant to Section 8.2
shall be applied first to the payment due on such Notes at final maturity and
thereafter to any required prepayments on such Notes, in inverse order of
maturity.
8.4. Maturity; Surrender, etc.
In the case of each prepayment of Notes pursuant to this Section 8,
the principal amount of each Note to be prepaid shall mature and become due and
payable on the date fixed for such prepayment, together with interest on such
principal amount accrued to such date and the applicable Make-Whole Amount, if
any. From and after such date, unless the Company shall fail to pay such
principal amount when so due and payable, together with the interest and Make-
Whole Amount, if any, as aforesaid, interest on such principal amount shall
cease to accrue. Any Note paid or prepaid in full shall be surrendered to the
Company and canceled and shall not be reissued, and no Note shall be issued in
lieu of any prepaid principal amount of any Note.
8.5. Purchase of Notes.
The Company will not, and will not permit any Affiliate to, purchase,
redeem, prepay or otherwise acquire, directly or indirectly, any of the
outstanding Notes except upon the payment or prepayment of the Notes in
accordance with the terms of this Agreement and the Notes. The Company will
promptly cancel all Notes acquired by it or any Affiliate pursuant to
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any payment, prepayment or purchase of Notes pursuant to any provision of this
Agreement and no Notes may be issued in substitution or exchange for any such
Notes.
8.6. Make-Whole Amount.
The term "Make-Whole Amount" means, with respect to any Note, an
amount equal to the excess, if any, of the Discounted Value of the Remaining
Scheduled Payments with respect to the Called Principal of such Note over the
amount of such Called Principal, provided that the Make-Whole Amount may in no
--------
event be less than zero. For the purposes of determining the Make-Whole Amount,
the following terms have the following meanings:
"Called Principal" means, with respect to any Note, the principal of
such Note that is to be prepaid pursuant to Section 8.2 or has become or
is declared to be immediately due and payable pursuant to Section 12.1,
as the context requires.
"Discounted Value" means, with respect to the Called Principal of any
Note, the amount obtained by discounting all Remaining Scheduled Payments
with respect to such Called Principal from their respective scheduled due
dates to the Settlement Date with respect to such Called Principal, in
accordance with accepted financial practice and at a discount factor
(applied on the same periodic basis as that on which interest on the
Notes is payable) equal to the Reinvestment Yield with respect to such
Called Principal.
"Reinvestment Yield" means, with respect to the Called Principal of
any Note, .50% over the yield to maturity implied by (i) the yields
reported, as of 10:00 A.M. (New York City time) on the second Business
Day preceding the Settlement Date with respect to such Called Principal,
on the display designated as the "PX1 Screen" on the Bloomberg Financial
Market Service (or such other display as may replace the PX1 Screen on
Bloomberg Financial Market Service) for actively traded U.S. Treasury
securities having a maturity equal to the Remaining Average Life of such
Called Principal as of such Settlement Date, or (ii) if such yields are
not reported as of such time or the yields reported as of such time are
not ascertainable, the Treasury Constant Maturity Series Yields reported,
for the latest day for which such yields have been so reported as of the
second Business Day preceding the Settlement Date with respect to such
Called Principal, in Federal Reserve Statistical Release H.15 (519) (or
any comparable successor publication) for actively traded U.S. Treasury
securities having a constant maturity equal to the Remaining Average Life
of such Called Principal as of such Settlement Date. Such implied yield
will be determined, if necessary, by (a) converting U.S. Treasury bill
quotations to bond-equivalent yields in accordance with accepted
financial practice and (b) interpolating linearly between (1) the
actively traded U.S. Treasury security with the maturity closest to and
greater than the Remaining Average Life and (2) the actively traded U.S.
Treasury security with the maturity closest to and less than the
Remaining Average Life.
"Remaining Average Life" means, with respect to any Called Principal,
the number of years (calculated to the nearest one-twelfth year) obtained
by dividing (i) such Called Principal into (ii) the sum of the products
obtained by multiplying (a) the principal component of each Remaining
Scheduled Payment with respect to such Called Principal
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<PAGE>
by (b) the number of years (calculated to the nearest one-twelfth year)
that will elapse between the Settlement Date with respect to such Called
Principal and the scheduled due date of such Remaining Scheduled Payment.
"Remaining Scheduled Payments" means, with respect to the Called
Principal of any Note, all payments of such Called Principal and interest
thereon that would be due after the Settlement Date with respect to such
Called Principal if no payment of such Called Principal were made prior
to its scheduled due date, provided that if such Settlement Date is not a
--------
date on which interest payments are due to be made under the terms of the
Notes in question, then the amount of the next succeeding scheduled
interest payment will be reduced by the amount of interest accrued to
such Settlement Date and required to be paid on such Settlement Date
pursuant to Section 8.2 or 12.1.
"Settlement Date" means, with respect to the Called Principal of any
Note, the date on which such Called Principal is to be prepaid pursuant
to Section 8.2 or has become or is declared to be immediately due and
payable pursuant to Section 12.1, as the context requires.
9. AFFIRMATIVE COVENANTS.
The Company covenants that so long as any of the Notes are
outstanding:
9.1. Compliance with Law.
The Company will, and will cause each Subsidiary to, comply with all
laws, ordinances or governmental rules or regulations to which each of them is
subject, including Environmental Laws, and will obtain and maintain in effect
all licenses, certificates, permits, franchises and other governmental
authorizations necessary to the ownership of their respective properties or to
the conduct of their respective businesses, in each case to the extent necessary
to ensure that non-compliance with such laws, ordinances or governmental rules
or regulations or failures to obtain or maintain in effect such licenses,
certificates, permits, franchises and other governmental authorizations would
not, individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect.
9.2. Insurance.
The Company will, and will cause each Restricted Subsidiary to,
maintain, with financially sound and reputable insurers, insurance with respect
to their respective properties and businesses against such casualties and
contingencies, of such types, on such terms and in such amounts (including
deductibles, co-insurance and self-insurance, if adequate reserves are
maintained with respect thereto) as is customary in the case of entities of
established reputations engaged in the same or a similar business and similarly
situated.
9.3. Maintenance of Properties.
The Company will, and will cause each Restricted Subsidiary to,
maintain and keep, or cause to be maintained and kept, their respective
properties in good repair, working
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order and condition (other than ordinary wear and tear), so that the business
carried on in connection therewith may be properly conducted at all times,
provided that this Section shall not prevent the Company or any Restricted
- --------
Subsidiary from discontinuing the operation and the maintenance of any of its
properties if such discontinuance is desirable in the conduct of its business
and the Company has concluded that such discontinuance would not, individually
or in the aggregate, reasonably be expected to have a Material Adverse Effect.
9.4. Payment of Taxes and Claims.
The Company will, and will cause each Subsidiary to, file all tax
returns required to be filed in any jurisdiction and to pay and discharge all
taxes shown to be due and payable on such returns and all other taxes,
assessments, governmental charges, or levies imposed on them or any of their
properties, assets, income or franchises, to the extent such taxes and
assessments have become due and payable and before they have become delinquent
and all claims for which sums have become due and payable that have or might
become a Lien on properties or assets of the Company or any Subsidiary, provided
--------
that neither the Company nor any Subsidiary need file any such return or pay any
such tax or assessment or claims if (i) the amount, applicability or validity
thereof is contested by the Company or such Subsidiary on a timely basis in good
faith and in appropriate proceedings, and the Company or a Subsidiary has
established adequate reserves therefor in accordance with GAAP on the books of
the Company or such Subsidiary or (ii) the nonfiling of all such returns and the
nonpayment of all such taxes and assessments in the aggregate would not
reasonably be expected to have a Material Adverse Effect.
9.5. Corporate Existence, etc.
Subject to Section 10.5, the Company will at all times preserve and
keep in full force and effect its corporate existence. Subject to Sections 10.4
and 10.5, the Company will at all times preserve and keep in full force and
effect the corporate existence of each Restricted Subsidiary (unless merged into
the Company or a Restricted Subsidiary) and all rights and franchises of the
Company and its Restricted Subsidiaries unless, in the good faith judgment of
the Company, the termination of or failure to preserve and keep in full force
and effect such corporate existence, right or franchise would not, individually
or in the aggregate, be reasonably expected to have a Material Adverse Effect.
10. NEGATIVE COVENANTS.
The Company covenants that so long as any of the Notes are
outstanding:
10.1. Adjusted Consolidated Net Worth.
The Company will not permit Adjusted Consolidated Net Worth to be less
than $300,000,000 at any time.
10.2. Indebtedness
The Company will not, and will not permit any Restricted Subsidiary
to, create, assume or incur or in any manner become liable for any Indebtedness,
except:
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(a) the Notes;
(b) Indebtedness of the Company and its Restricted Subsidiaries
outstanding as of March 31, 1999 and reflected on Schedule 5.15;
(c) Indebtedness of a Restricted Subsidiary to the Company or to
another Wholly-Owned Restricted Subsidiary;
(d) additional unsecured Indebtedness of the Company and its
Restricted Subsidiaries and additional Indebtedness of the Company and
its Restricted Subsidiaries secured by Liens permitted by Sections
10.3(g) and (i), provided that at the time of incurrence thereof and
after giving effect thereto and to the application of the proceeds
thereof:
(i) no Default or Event of Default exists and Consolidated
Indebtedness does not exceed 60% of Consolidated Total Capitalization;
and
(ii) in the case of Indebtedness of a Restricted Subsidiary, the
aggregate principal amount of all Indebtedness of Restricted
Subsidiaries (other than Indebtedness permitted by Section 10.2(c))
does not exceed 45% of Consolidated Net Worth; and
(iii) in the case of Indebtedness of the Company or a Restricted
Subsidiary secured by Liens described in Section 10.3(i), the
aggregate principal amount of all such Indebtedness so secured does
not exceed 15% of Consolidated Net Worth.
For all purposes of this Section 10.2, any Person that becomes a Restricted
Subsidiary after the date of this Agreement shall be deemed to have incurred, at
the time it becomes a Restricted Subsidiary, all Indebtedness of such Person
outstanding immediately after it becomes a Restricted Subsidiary.
10.3. Liens.
The Company will not, and will not permit any Restricted Subsidiary
to, permit to exist, create, assume or incur, directly or indirectly, any Lien
on its properties or assets, whether now owned or hereafter acquired except:
(a) Liens for taxes, assessments or governmental charges not then due
and payable or the nonpayment of which is permitted by Section 9.4;
(b) Liens incidental to the conduct of business or the ownership of
properties and assets (including landlords', lessors', carriers',
warehousemen's, mechanics', materialmen's and other similar liens) and
Liens to secure the performance of bids, tenders, leases or trade
contracts, or to secure statutory obligations (including obligations
under workers compensation, unemployment insurance and other social
security
22
<PAGE>
legislation), surety or appeal bonds or other Liens of like general
nature incurred in the ordinary course of business and not in connection
with the borrowing of money;
(c) any attachment or judgment Lien, unless the judgment it secures
has not, within 60 days after the entry thereof, been discharged or
execution thereof stayed pending appeal, or has not been discharged
within 60 days after the expiration of any such stay;
(d) Liens securing Indebtedness of a Restricted Subsidiary to the
Company or to another Wholly-Owned Restricted Subsidiary;
(e) Liens existing on property or assets of the Company or any
Restricted Subsidiary as of the date of this Agreement that are described
in Schedule 10.3;
(f) encumbrances in the nature of leases, subleases, zoning
restrictions, easements, rights of way and other rights and restrictions
of record on the use of real property, minor survey exceptions and
defects in title incidental to the ownership of property or assets or to
the ordinary conduct of business, which, individually and in the
aggregate, do not materially impair the use or value of the property or
assets subject thereto;
(g) Liens (i) existing on property at the time of its acquisition by
the Company or a Restricted Subsidiary and not created in contemplation
thereof, whether or not the Indebtedness secured by such Lien is assumed
by the Company or a Restricted Subsidiary; or (ii) on property created
contemporaneously with its acquisition or construction or within 180 days
of the acquisition or completion of construction thereof to secure or
provide for all or a portion of the purchase price or cost of
construction of such property after the date of Closing; or (iii)
existing on property of a Person at the time such Person is merged or
consolidated with, or becomes a Restricted Subsidiary of, or
substantially all of its assets are acquired by, the Company or a
Restricted Subsidiary and not created in contemplation thereof; provided
--------
that, in the case of clauses (i), (ii) and (iii), such Liens do not
extend to additional property of the Company or any Restricted Subsidiary
and that the aggregate principal amount of Indebtedness secured by each
such Lien does not exceed the lesser of the cost of acquisition or
construction or the fair market value (as determined in good faith by one
or more officers to whom authority to enter into the transaction has been
delegated by the Board of Directors of the Company) of the property
subject thereto;
(h) Liens resulting from extensions, renewals or replacements of
Liens permitted by paragraphs (e) and (g), provided that (i) there is no
increase in the principal amount or decrease in maturity of the
Indebtedness secured thereby at the time of such extension, renewal or
replacement, (ii) any new Lien attaches only to the same property
theretofore subject to such earlier Lien and (iii) immediately after such
extension, renewal or replacement no Default or Event of Default would
exist; and
(i) Additional Liens securing Indebtedness not otherwise permitted by
paragraphs (a) through (h) above, provided that, at the time of creation,
assumption or
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incurrence thereof and immediately after giving effect thereto and to the
application of the proceeds therefrom, such Indebtedness is permitted by
Section 10.2(d)(iii).
10.4. Sale of Assets.
Except as permitted by Section 10.5, the Company will not, and will
not permit any Restricted Subsidiary to, sell, lease, transfer or otherwise
dispose of, including by way of merger (collectively a "Disposition"), any
assets, including capital stock of Restricted Subsidiaries, in one or more
transactions, to any Person, other than (a) Dispositions in the ordinary course
of business, (b) Dispositions by the Company to a Restricted Subsidiary or by a
Restricted Subsidiary to the Company or another Restricted Subsidiary or (c)
Dispositions not otherwise permitted by this Section 10.4, provided that the
aggregate net book value of all assets so disposed of in any fiscal year
pursuant to this Section 10.4(c) does not exceed 10% of Consolidated Total
Assets as of the end of the immediately preceding fiscal year. Notwithstanding
the foregoing, the Company may, or may permit any Restricted Subsidiary to, make
a Disposition and the assets subject to such Disposition shall not be subject to
or included in the foregoing limitation and computation contained in clause (c)
of the preceding sentence to the extent that (x) such assets are leased back by
the Company or any Restricted Subsidiary, as lessee, within 180 days of the
original acquisition or construction thereof by the Company or such Restricted
Subsidiary, or (y) the net proceeds from such Disposition are within 180 days of
such Disposition (A) reinvested in productive assets by the Company or a
Restricted Subsidiary consistent with Section 10.8 or (B) applied to the payment
or prepayment of any outstanding Indebtedness of the Company or any Restricted
Subsidiary that is not subordinated to the Notes. Any prepayment of Notes
pursuant to this Section 10.4 shall be in accordance with Sections 8.2 and 8.3,
without regard to the minimum prepayment requirements of Section 8.2.
10.5. Mergers, Consolidations, etc.
The Company will not, and will not permit any Restricted Subsidiary
to, consolidate with or merge with any other Person or convey, transfer, sell or
lease all or substantially all of its assets in a single transaction or series
of transactions to any Person except that:
(a) The Company may consolidate or merge with any other Person or
convey, transfer, sell or lease all or substantially all of its assets in
a single transaction or series of transactions to any Person, provided
that:
(i) the successor formed by such consolidation or the survivor
of such merger or the Person that acquires by conveyance, transfer,
sale or lease of all or substantially all of the assets of the Company
as an entirety, as the case may be, shall be a solvent corporation
organized and existing under the laws of the United States or any
State thereof (including the District of Columbia), and, if the
Company is not such corporation, such corporation (x) shall have
executed and delivered to each holder of any Notes its assumption of
the due and punctual performance and observance of each covenant and
condition of this Agreement and the Notes and (y) shall have caused to
be delivered to each holder of any Notes an opinion of independent
counsel reasonably satisfactory to the Required
24
<PAGE>
Holders, to the effect that all agreements or instruments effecting
such assumption are enforceable in accordance with their terms and
comply with the terms hereof;
(ii) the successor formed by such consolidation or the survivor
of such merger or the Person that acquires by conveyance, transfer,
sale or lease all or substantially all of the assets of the Company as
an entirety, as the case may be, could incur immediately thereafter
$1.00 of additional Indebtedness pursuant to Section 10.2(d);
(iii) immediately before and after giving effect to such
transaction, no Default or Event of Default shall exist; and
(b) Any Restricted Subsidiary may (x) merge into the Company
(provided that the Company is the surviving corporation) or another
Wholly-Owned Restricted Subsidiary or (y) sell, transfer or lease all or
any part of its assets to the Company or another Wholly-Owned Restricted
Subsidiary, or (z) merge or consolidate with, or sell, transfer or lease
all or substantially all of its assets to, any Person in a transaction
that is permitted by Section 10.4 or, as a result of which, such Person
becomes a Restricted Subsidiary; provided in each instance set forth in
--------
clauses (x) through (z) that, immediately before and after giving effect
thereto, there shall exist no Default or Event of Default;
No such conveyance, transfer, sale or lease of all or substantially all of the
assets of the Company shall have the effect of releasing the Company or any
successor corporation that shall theretofore have become such in the manner
prescribed in this Section 10.5 from its liability under this Agreement or the
Notes.
10.6. Disposition of Stock of Restricted Subsidiaries.
The Company (i) will not permit any Restricted Subsidiary to issue its
capital stock, or any warrants, rights or options to purchase, or securities
convertible into or exchangeable for, such capital stock, to any Person other
than the Company or another Wholly-Owned Restricted Subsidiary, and (ii) will
not, and will not permit any Restricted Subsidiary to, sell, transfer or
otherwise dispose of any shares of capital stock of a Restricted Subsidiary if
such sale would be prohibited by Section 10.4. If a Restricted Subsidiary at any
time ceases to be such as a result of a sale or issuance of its capital stock,
any Liens on property of the Company or any other Restricted Subsidiary securing
Indebtedness owed to such Restricted Subsidiary, which is not contemporaneously
repaid, together with such Indebtedness, shall be deemed to have been incurred
by the Company or such other Restricted Subsidiary, as the case may be, at the
time such Restricted Subsidiary ceases to be a Restricted Subsidiary.
10.7. Designation of Unrestricted and Restricted Subsidiaries.
The Company may designate any Restricted Subsidiary as an Unrestricted
Subsidiary and any Unrestricted Subsidiary as a Restricted Subsidiary; provided
that, (a) if such Subsidiary initially is a Restricted Subsidiary, then such
Restricted Subsidiary may be subsequently designated as an Unrestricted
Subsidiary and such Unrestricted Subsidiary may be
25
<PAGE>
subsequently designated as a Restricted Subsidiary, but no further changes in
designation may be made, (b) if such Subsidiary initially is an Unrestricted
Subsidiary, then such Unrestricted Subsidiary may be subsequently designated as
a Restricted Subsidiary and such Restricted Subsidiary may be subsequently
designated as an Unrestricted Subsidiary, but no further changes in designation
may be made, and (c) immediately before and after designation of a Restricted
Subsidiary as an Unrestricted Subsidiary there exists no Default or Event of
Default.
10.8. Nature of Business.
The Company will not, and will not permit any Restricted Subsidiary
to, engage in any business if, as a result, the general nature of the business
in which the Company and its Restricted Subsidiaries, taken as a whole, would
then be engaged would be substantially changed from the general nature of the
business in which the Company and its Restricted Subsidiaries, taken as a whole,
are engaged on the date of this Agreement.
10.9. Transactions with Affiliates.
The Company will not and will not permit any Restricted Subsidiary to
enter into directly or indirectly any Material transaction or Material group of
related transactions (including the purchase, lease, sale or exchange of
properties of any kind or the rendering of any service) with any Affiliate
(other than the Company or another Restricted Subsidiary), except upon fair and
reasonable terms no less favorable to the Company or such Restricted Subsidiary
than would be obtainable in a comparable arm's-length transaction with a Person
not an Affiliate.
11. EVENTS OF DEFAULT.
An "Event of Default" shall exist if any of the following conditions
or events shall occur and be continuing:
(a) the Company defaults in the payment of any principal or Make-
Whole Amount, if any, on any Note when the same becomes due and payable,
whether at maturity or at a date fixed for prepayment or by declaration
or otherwise; or
(b) the Company defaults in the payment of any interest on any Note
for more than five Business Days after the same becomes due and payable;
or
(c) the Company defaults in the performance of or compliance with any
term contained in Sections 10.2, 10.4 or 10.5; or
(d) the Company defaults in the performance of or compliance with any
term contained herein (other than those referred to in paragraphs (a),
(b) and (c) of this Section 11) and such default is not remedied within
30 days after the earlier of (i) a Responsible Officer obtaining actual
knowledge of such default and (ii) the Company receiving written notice
of such default from any holder of a Note; or
(e) any representation or warranty made in writing by or on behalf of
the Company or by any officer of the Company in this Agreement or in any
writing furnished
26
<PAGE>
in connection with the transactions contemplated hereby proves to have
been false or incorrect in any material respect on the date as of which
made; or
(f) (i) the Company or any Significant Subsidiary is in default (as
principal or as guarantor or other surety) in the payment of any
principal of or premium or make-whole amount or interest aggregating
$100,000 or more on any Indebtedness that is outstanding in an aggregate
principal amount in excess of 5% of Adjusted Consolidated Net Worth (as
of the end of the most recently completed fiscal period of the Company)
beyond any period of grace provided with respect thereto or (ii) the
Company or any Significant Subsidiary is in default in the performance of
or compliance with any term of any evidence of any Indebtedness that is
outstanding in an aggregate principal amount in excess of 5% of Adjusted
Consolidated Net Worth (as of the end of the most recently completed
fiscal period of the Company) or of any mortgage, indenture or other
agreement relating thereto or any other condition exists, and as a
consequence of such default or condition such Indebtedness has become, or
has been declared, due and payable before its stated maturity or before
its regularly scheduled dates of payment; or
(g) the Company or any Significant Subsidiary (i) is generally not
paying, or admits in writing its inability to pay, its debts as they
become due, (ii) files, or consents by answer or otherwise to the filing
against it of, a petition for relief or reorganization or arrangement or
any other petition in bankruptcy, for liquidation or to take advantage of
any bankruptcy, insolvency, reorganization, moratorium or other similar
law of any jurisdiction, (iii) makes an assignment for the benefit of its
creditors, (iv) consents to the appointment of a custodian, receiver,
trustee or other officer with similar powers with respect to it or with
respect to any substantial part of its property, (v) is adjudicated as
insolvent or to be liquidated, or (vi) takes corporate action for the
purpose of any of the foregoing; or
(h) a court or governmental authority of competent jurisdiction
enters an order appointing, without consent by the Company or any
Significant Subsidiary, a custodian, receiver, trustee or other officer
with similar powers with respect to it or with respect to any substantial
part of its property, or constituting an order for relief or approving a
petition for relief or reorganization or any other petition in bankruptcy
or for liquidation or to take advantage of any bankruptcy or insolvency
law of any jurisdiction, or ordering the dissolution, winding-up or
liquidation of the Company or any Significant Subsidiary, or any such
petition shall be filed against the Company or any Significant Subsidiary
and such petition shall not be dismissed within 60 days; or
(i) a final judgment or judgments for the payment of money
aggregating 5% or more of Adjusted Consolidated Net Worth (as of the end
of the most recently completed fiscal period of the Company) are rendered
against one or more of the Company and its Significant Subsidiaries,
which judgments are not, within 60 days after entry thereof, bonded,
discharged or stayed pending appeal, or are not discharged within 60 days
after the expiration of such stay; or
(j) if (i) any Plan shall fail to satisfy the minimum funding
standards of ERISA or the Code for any plan year or part thereof or a
waiver of such standards or
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<PAGE>
extension of any amortization period is sought or granted under section
412 of the Code, (ii) a notice of intent to terminate any Plan shall have
been or is reasonably expected to be filed with the PBGC or the PBGC
shall have instituted proceedings under ERISA section 4042 to terminate
or appoint a trustee to administer any Plan or the PBGC shall have
notified the Company or any ERISA Affiliate that a Plan may become a
subject of any such proceedings, (iii) the aggregate "amount of unfunded
benefit liabilities" (within the meaning of section 4001(a)(18) of ERISA)
under all Plans, determined in accordance with Title IV of ERISA, shall
equal or exceed 5% of Adjusted Consolidated Net Worth (as of the end of
the most recently completed fiscal period of the Company), (iv) the
Company or any ERISA Affiliate shall have incurred or is reasonably
expected to incur any liability pursuant to Title I or IV of ERISA or the
penalty or excise tax provisions of the Code relating to employee benefit
plans, (v) the Company or any ERISA Affiliate withdraws from any
Multiemployer Plan, or (vi) the Company or any Subsidiary establishes or
amends any employee welfare benefit plan that provides post-employment
welfare benefits in a manner that would increase the liability of the
Company or any Subsidiary thereunder; and any such event or events
described in clauses (i) through (vi) above, either individually or
together with any other such event or events, would reasonably be
expected to have a Material Adverse Effect.
As used in Section 11(j), the terms "employee benefit plan" and "employee
welfare benefit plan" shall have the respective meanings assigned to such terms
in Section 3 of ERISA.
12. REMEDIES ON DEFAULT, ETC.
12.1. Acceleration.
(a) If an Event of Default with respect to the Company described in
paragraph (g) or (h) of Section 11 (other than an Event of Default
described in clause (i) of paragraph (g) or described in clause (vi) of
paragraph (g) by virtue of the fact that such clause encompasses clause
(i) of paragraph (g)) has occurred, all the Notes then outstanding shall
automatically become immediately due and payable.
(b) If any other Event of Default has occurred and is continuing, any
holder or holders of more than 50% in principal amount of the Notes at
the time outstanding may at any time at its or their option, by notice or
notices to the Company, declare all Notes then outstanding to be
immediately due and payable.
(c) If any Event of Default described in paragraph (a) or (b) of
Section 11 has occurred and is continuing, any holder or holders of Notes
at the time outstanding affected by such Event of Default may at any
time, at its or their option, by notice or notices to the Company,
declare all the Notes held by it or them to be immediately due and
payable.
Upon any Notes becoming due and payable under this Section 12.1,
whether automatically or by declaration, such Notes will forthwith mature and
the entire unpaid principal amount of such Notes, plus (x) all accrued and
unpaid interest thereon and (y) the Make-Whole Amount determined in respect of
such principal amount (to the full extent permitted by
28
<PAGE>
applicable law), shall all be immediately due and payable, in each and every
case without presentment, demand, protest or further notice, all of which are
hereby waived. The Company acknowledges, and the parties hereto agree, that each
holder of a Note has the right to maintain its investment in the Notes free from
repayment by the Company (except as herein specifically provided for) and that
the provision for payment of a Make-Whole Amount by the Company in the event
that the Notes are prepaid or are accelerated as a result of an Event of
Default, is intended to provide compensation for the deprivation of such right
under such circumstances.
12.2. Other Remedies.
If any Default or Event of Default has occurred and is continuing, and
irrespective of whether any Notes have become or have been declared immediately
due and payable under Section 12.1, the holder of any Note at the time
outstanding may proceed to protect and enforce the rights of such holder by an
action at law, suit in equity or other appropriate proceeding, whether for the
specific performance of any agreement contained herein or in any Note, or for an
injunction against a violation of any of the terms hereof or thereof, or in aid
of the exercise of any power granted hereby or thereby or by law or otherwise.
12.3. Rescission.
At any time after any Notes have been declared due and payable
pursuant to clause (b) or (c) of Section 12.1, the holders of more than 50% in
principal amount of the Notes then outstanding, by written notice to the
Company, may rescind and annul any such declaration and its consequences if (a)
the Company has paid all overdue interest on the Notes, all principal of and
Make-Whole Amount, if any, on any Notes that are due and payable and are unpaid
other than by reason of such declaration, and all interest on such overdue
principal and Make-Whole Amount, if any, and (to the extent permitted by
applicable law) any overdue interest in respect of the Notes, at the Default
Rate, (b) all Events of Default and Defaults, other than non-payment of amounts
that have become due solely by reason of such declaration, have been cured or
have been waived pursuant to Section 17, and (c) no judgment or decree has been
entered for the payment of any monies due pursuant hereto or to the Notes. No
rescission and annulment under this Section 12.3 will extend to or affect any
subsequent Event of Default or Default or impair any right consequent thereon.
12.4. No Waivers or Election of Remedies, Expenses, etc.
No course of dealing and no delay on the part of any holder of any
Note in exercising any right, power or remedy shall operate as a waiver thereof
or otherwise prejudice such holder's rights, powers or remedies. No right, power
or remedy conferred by this Agreement or by any Note upon any holder thereof
shall be exclusive of any other right, power or remedy referred to herein or
therein or now or hereafter available at law, in equity, by statute or
otherwise. Without limiting the obligations of the Company under Section 15, the
Company will pay to the holder of each Note on demand such further amount as
shall be sufficient to cover all costs and expenses of such holder incurred in
any enforcement or collection under this Section 12, including, without
limitation, reasonable attorneys' fees, expenses and disbursements.
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<PAGE>
13. REGISTRATION; EXCHANGE; SUBSTITUTION OF NOTES.
13.1. Registration of Notes.
The Company shall keep at its principal executive office a register
for the registration and registration of transfers of Notes. The name and
address of each holder of one or more Notes, each transfer thereof and the name
and address of each transferee of one or more Notes shall be registered in such
register. Prior to due presentment for registration of transfer, the Person in
whose name any Note shall be registered shall be deemed and treated as the owner
and holder thereof for all purposes hereof, and the Company shall not be
affected by any notice or knowledge to the contrary. The Company shall give to
any holder of a Note that is an Institutional Investor, promptly upon request
therefor, a complete and correct copy of the names and addresses of all
registered holders of Notes.
13.2. Transfer and Exchange of Notes.
Upon surrender of any Note at the principal executive office of the
Company for registration of transfer or exchange (and in the case of a surrender
for registration of transfer, duly endorsed or accompanied by a written
instrument of transfer duly executed by the registered holder of such Note or
his attorney duly authorized in writing and accompanied by the address for
notices of each transferee of such Note or part thereof), the Company shall
execute and deliver, at the Company's expense (except as provided below), one or
more new Notes (as requested by the holder thereof) of the same series in
exchange therefor, in an aggregate principal amount equal to the unpaid
principal amount of the surrendered Note. Each such new Note shall be payable to
such Person as such holder may request and shall be substantially in the form of
the Note established for such series. Each such new Note shall be dated and bear
interest from the date to which interest shall have been paid on the surrendered
Note or dated the date of the surrendered Note if no interest shall have been
paid thereon. The Company may require payment of a sum sufficient to cover any
stamp tax or governmental charge imposed in respect of any such transfer of
Notes. Notes shall not be transferred in denominations of less than $500,000,
provided that if necessary to enable the registration of transfer by a holder
- --------
of its entire holding of Notes, one Note may be in a denomination of less than
$500,000. Any transferee, by its acceptance of a Note registered in its name (or
the name of its nominee), shall be deemed to have made the representation set
forth in Section 6.2.
13.3. Replacement of Notes.
Upon receipt by the Company of evidence reasonably satisfactory to it
of the ownership of and the loss, theft, destruction or mutilation of any Note
(which evidence shall be, in the case of an Institutional Investor, notice from
such Institutional Investor of such ownership and such loss, theft, destruction
or mutilation), and
(a) in the case of loss, theft or destruction, of indemnity
reasonably satisfactory to it (provided that if the holder of such Note
--------
is, or is a nominee for, an original Purchaser or another Institutional
Investor holder of a Note with a minimum net worth of at least
$50,000,000, such Person's own unsecured agreement of indemnity shall be
deemed to be satisfactory), or
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(b) in the case of mutilation, upon surrender and cancellation
thereof,
the Company at its own expense shall execute and deliver, in lieu thereof, a new
Note of the same series, dated and bearing interest from the date to which
interest shall have been paid on such lost, stolen, destroyed or mutilated Note
or dated the date of such lost, stolen, destroyed or mutilated Note if no
interest shall have been paid thereon.
14. PAYMENTS ON NOTES.
14.1. Place of Payment.
Subject to Section 14.2, payments of principal, Make-Whole Amount, if
any, and interest becoming due and payable on the Notes shall be made in
Chicago, Illinois at the principal office of Bank of America in such
jurisdiction. The Company may at any time, by notice to each holder of a Note,
change the place of payment of the Notes so long as such place of payment shall
be either the principal office of the Company in such jurisdiction or the
principal office of a bank or trust company in such jurisdiction.
14.2. Home Office Payment.
So long as you or your nominee shall be the holder of any Note, and
notwithstanding anything contained in Section 14.1 or in such Note to the
contrary, the Company will pay all sums becoming due on such Note for principal,
Make-Whole Amount, if any, and interest by the method and at the address
specified for such purpose below your name in Schedule A, or by such other
method or at such other address as you shall have from time to time specified to
the Company in writing for such purpose, without the presentation or surrender
of such Note or the making of any notation thereon, except that upon written
request of the Company made concurrently with or reasonably promptly after
payment or prepayment in full of any Note, you shall surrender such Note for
cancellation, reasonably promptly after any such request, to the Company at its
principal executive office or at the place of payment most recently designated
by the Company pursuant to Section 14.1. Prior to any sale or other disposition
of any Note held by you or your nominee you will, at your election, either
endorse thereon the amount of principal paid thereon and the last date to which
interest has been paid thereon or surrender such Note to the Company in exchange
for a new Note or Notes pursuant to Section 13.2. The Company will afford the
benefits of this Section 14.2 to any Institutional Investor that is the direct
or indirect transferee of any Note purchased by you under this Agreement and
that has made the same agreement relating to such Note as you have made in this
Section 14.2.
15. EXPENSES, ETC.
15.1. Transaction Expenses.
Whether or not the transactions contemplated hereby are consummated,
the Company will pay all reasonable costs and expenses (including reasonable
attorneys' fees of a special counsel and, if reasonably required, local or other
counsel) incurred by you and each Other Purchaser or holder of a Note in
connection with such transactions and in connection with any amendments, waivers
or consents under or in respect of this Agreement or the Notes
31
<PAGE>
(whether or not such amendment, waiver or consent becomes effective), including,
without limitation: (a) the reasonable costs and expenses incurred in enforcing
or defending (or determining whether or how to enforce or defend) any rights
under this Agreement or the Notes or in responding to any subpoena or other
legal process or informal investigative demand issued in connection with this
Agreement or the Notes, or by reason of being a holder of any Note, and (b) the
reasonable costs and expenses, including financial advisors' fees, incurred in
connection with the insolvency or bankruptcy of the Company or any Subsidiary or
in connection with any work-out or restructuring of the transactions
contemplated hereby and by the Notes. The Company will pay, and will save you
and each other holder of a Note harmless from, all claims in respect of any
fees, costs or expenses if any, of brokers and finders (other than those
retained by you).
15.2. Survival.
The obligations of the Company under this Section 15 will survive the
payment or transfer of any Note, the enforcement, amendment or waiver of any
provision of this Agreement or the Notes, and the termination of this Agreement.
16. SURVIVAL OF REPRESENTATIONS AND WARRANTIES; ENTIRE AGREEMENT.
All representations and warranties contained herein shall survive the
execution and delivery of this Agreement and the Notes, the purchase or transfer
by you of any Note or portion thereof or interest therein and the payment of any
Note, and may be relied upon by any subsequent holder of a Note, regardless of
any investigation made at any time by or on behalf of you or any other holder of
a Note. All statements contained in any certificate or other instrument
delivered by or on behalf of the Company pursuant to this Agreement shall be
deemed representations and warranties of the Company under this Agreement.
Subject to the preceding sentence, this Agreement and the Notes embody the
entire agreement and understanding between you and the Company and supersede all
prior agreements and understandings relating to the subject matter hereof.
17. AMENDMENT AND WAIVER.
17.1. Requirements.
This Agreement and the Notes may be amended, and the observance of any
term hereof or of the Notes may be waived (either retroactively or
prospectively), with (and only with) the written consent of the Company and the
Required Holders, except that (a) no amendment or waiver of any of the
provisions of Section 1, 2, 3, 4, 5, 6 or 21 hereof, or any defined term (as it
is used therein), will be effective as to you unless consented to by you in
writing, and (b) no such amendment or waiver may, without the written consent of
the holder of each Note at the time outstanding affected thereby, (i) subject to
the provisions of Section 12 relating to acceleration or rescission, change the
amount or time of any prepayment or payment of principal of, or reduce the rate
or change the time of payment or method of computation of interest or of the
Make-Whole Amount on, the Notes, (ii) change the percentage of the principal
amount of the Notes the
32
<PAGE>
holders of which are required to consent to any such amendment or waiver, or
(iii) amend any of Sections 8, 11(a), 11(b), 12, 17 or 20.
17.2. Solicitation of Holders of Notes.
(a) Solicitation. The Company will provide each holder of the Notes
------------
(irrespective of the amount of Notes then owned by it) with sufficient
information, sufficiently far in advance of the date a decision is
required, to enable such holder to make an informed and considered
decision with respect to any proposed amendment, waiver or consent in
respect of any of the provisions hereof or of the Notes. The Company will
deliver executed or true and correct copies of each amendment, waiver or
consent effected pursuant to the provisions of this Section 17 to each
holder of outstanding Notes promptly following the date on which it is
executed and delivered by, or receives the consent or approval of, the
requisite holders of Notes.
(b) Payment. The Company will not directly or indirectly pay or cause
-------
to be paid any remuneration, whether by way of supplemental or additional
interest, fee or otherwise, or grant any security, to any holder of Notes
as consideration for or as an inducement to the entering into by any
holder of Notes or any waiver or amendment of any of the terms and
provisions hereof unless such remuneration is concurrently paid, or
security is concurrently granted, on the same terms, ratably to each
holder of Notes then outstanding even if such holder did not consent to
such waiver or amendment.
17.3. Binding Effect, etc.
Any amendment or waiver consented to as provided in this Section 17
applies equally to all holders of Notes and is binding upon them and upon each
future holder of any Note and upon the Company without regard to whether such
Note has been marked to indicate such amendment or waiver. No such amendment or
waiver will extend to or affect any obligation, covenant, agreement, Default or
Event of Default not expressly amended or waived or impair any right consequent
thereon. No course of dealing between the Company and the holder of any Note nor
any delay in exercising any rights hereunder or under any Note shall operate as
a waiver of any rights of any holder of such Note. As used herein, the term
"this Agreement" or "the Agreement" and references thereto shall mean this
Agreement as it may from time to time be amended or supplemented.
17.4. Notes held by Company, etc.
Solely for the purpose of determining whether the holders of the
requisite percentage of the aggregate principal amount of Notes then outstanding
approved or consented to any amendment, waiver or consent to be given under this
Agreement or the Notes, or have directed the taking of any action provided
herein or in the Notes to be taken upon the direction of the holders of a
specified percentage of the aggregate principal amount of Notes then
outstanding, Notes directly or indirectly owned by the Company or any of its
Affiliates shall be deemed not to be outstanding.
33
<PAGE>
18. NOTICES.
All notices and communications provided for hereunder shall be in
writing and sent (a) by telecopy if the sender on the same day sends a
confirming copy of such notice by a recognized overnight delivery service
(charges prepaid), or (b) by registered or certified mail with return receipt
requested (postage prepaid), or (c) by a recognized overnight delivery service
(with charges prepaid). Any such notice must be sent:
(i) if to you or your nominee, to you or it at the address
specified for such communications in Schedule A, or at such other
address as you or it shall have specified to the Company in writing,
(ii) if to any other holder of any Note, to such holder at such
address as such other holder shall have specified to the Company in
writing, or
(iii) if to the Company, to the Company at its address set forth
at the beginning hereof to the attention of Senior Financial Officer,
or at such other address as the Company shall have specified to the
holder of each Note in writing.
Notices under this Section 18 will be deemed given only when actually received.
19. REPRODUCTION OF DOCUMENTS.
This Agreement and all documents relating thereto, including, without
limitation, (a) consents, waivers and modifications that may hereafter be
executed, (b) documents received by you at the Closing (except the Notes
themselves), and (c) financial statements, certificates and other information
previously or hereafter furnished to you, may be reproduced by you by any
photographic, photostatic, microfilm, microcard, miniature photographic or other
similar process and you may destroy any original document so reproduced. The
Company agrees and stipulates that, to the extent permitted by applicable law,
any such reproduction shall be admissible in evidence as the original itself in
any judicial or administrative proceeding (whether or not the original is in
existence and whether or not such reproduction was made by you in the regular
course of business) and any enlargement, facsimile or further reproduction of
such reproduction shall likewise be admissible in evidence. This Section 19
shall not prohibit the Company or any other holder of Notes from contesting any
such reproduction to the same extent that it could contest the original, or from
introducing evidence to demonstrate the inaccuracy of any such reproduction.
20. CONFIDENTIAL INFORMATION.
For the purposes of this Section 20, "Confidential Information" means
information delivered to you by or on behalf of the Company or any Subsidiary in
connection with the transactions contemplated by or otherwise pursuant to this
Agreement that is proprietary in nature and that was clearly marked or labeled
or otherwise adequately identified in writing when received by you as being
confidential information of the Company or such Subsidiary, provided that such
--------
term does not include information that (a) was publicly known or otherwise known
to you prior to the time of such disclosure, (b) subsequently becomes publicly
known through no act or omission by you or any person acting on your behalf, (c)
otherwise becomes
34
<PAGE>
known to you other than through disclosure by the Company or any Subsidiary or
(d) constitutes financial statements delivered to you under Section 7.1 that are
otherwise publicly available. You will maintain the confidentiality of such
Confidential Information in accordance with procedures adopted by you in good
faith to protect confidential information of third parties delivered to you,
provided that you may deliver or disclose Confidential Information to (i) your
directors, trustees, officers, employees, agents, attorneys and affiliates (to
the extent such disclosure reasonably relates to the administration of the
investment represented by your Notes), (ii) your financial advisors and other
professional advisors who agree to hold confidential the Confidential
Information substantially in accordance with the terms of this Section 20, (iii)
any other holder of any Note, (iv) any Institutional Investor to which you sell
or offer to sell such Note or any part thereof or any participation therein (if
such Person has agreed in writing prior to its receipt of such Confidential
Information to be bound by the provisions of this Section 20), (v) any Person
from which you offer to purchase any security of the Company (if such Person has
agreed in writing prior to its receipt of such Confidential Information to be
bound by the provisions of this Section 20), (vi) any federal or state
regulatory authority having jurisdiction over you, (vii) the National
Association of Insurance Commissioners or any similar organization, or any
nationally recognized rating agency that requires access to information about
your investment portfolio or (viii) any other Person to which such delivery or
disclosure may be necessary or appropriate (w) to effect compliance with any
law, rule, regulation or order applicable to you, (x) in response to any
subpoena or other legal process, (y) in connection with any litigation to which
you are a party or (z) if an Event of Default has occurred and is continuing, to
the extent you may reasonably determine such delivery and disclosure to be
necessary or appropriate in the enforcement or for the protection of the rights
and remedies under your Notes and this Agreement. Each holder of a Note, by its
acceptance of a Note, will be deemed to have agreed to be bound by and to be
entitled to the benefits of this Section 20 as though it were a party to this
Agreement. On reasonable request by the Company in connection with the delivery
to any holder of a Note of information required to be delivered to such holder
under this Agreement or requested by such holder (other than a holder that is a
party to this Agreement or its nominee), such holder will enter into an
agreement with the Company embodying the provisions of this Section 20.
21. SUBSTITUTION OF PURCHASER.
You shall have the right to substitute any one of your Affiliates as
the purchaser of the Notes that you have agreed to purchase hereunder, by
written notice to the Company, which notice shall be signed by both you and such
Affiliate, shall contain such Affiliate's agreement to be bound by this
Agreement and shall contain a confirmation by such Affiliate of the accuracy
with respect to it of the representations set forth in Section 6. Upon receipt
of such notice, wherever the word "you" is used in this Agreement (other than in
this Section 21), such word shall be deemed to refer to such Affiliate in lieu
of you. In the event that such Affiliate is so substituted as a purchaser
hereunder and such Affiliate thereafter transfers to you all of the Notes then
held by such Affiliate, upon receipt by the Company of notice of such transfer,
wherever the word "you" is used in this Agreement (other than in this Section
21), such word shall no longer be deemed to refer to such Affiliate, but shall
refer to you, and you shall have all the rights of an original holder of the
Notes under this Agreement.
35
<PAGE>
22. MISCELLANEOUS.
22.1. Successors and Assigns.
All covenants and other agreements contained in this Agreement by or
on behalf of any of the parties hereto bind and inure to the benefit of their
respective successors and assigns (including, without limitation, any subsequent
holder of a Note) whether so expressed or not.
22.2. Payments Due on Non-Business Days.
Anything in this Agreement or the Notes to the contrary
notwithstanding, any payment of principal of or Make-Whole Amount or interest on
any Note that is due on a date other than a Business Day shall be made on the
next succeeding Business Day without including the additional days elapsed in
the computation of the interest payable on such next succeeding Business Day.
22.3. Severability.
Any provision of this Agreement that is prohibited or unenforceable in
any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall (to the full extent permitted by law) not invalidate or
render unenforceable such provision in any other jurisdiction.
22.4. Construction.
Each covenant contained herein shall be construed (absent express
provision to the contrary) as being independent of each other covenant contained
herein, so that compliance with any one covenant shall not (absent such an
express contrary provision) be deemed to excuse compliance with any other
covenant. Where any provision herein refers to action to be taken by any Person,
or which such Person is prohibited from taking, such provision shall be
applicable whether such action is taken directly or indirectly by such Person.
22.5. Counterparts.
This Agreement may be executed in any number of counterparts, each of
which shall be an original but all of which together shall constitute one
instrument. Each counterpart may consist of a number of copies hereof, each
signed by less than all, but together signed by all, of the parties hereto.
22.6. Governing Law.
This Agreement shall be construed and enforced in accordance with, and
the rights of the parties shall be governed by, the law of the State of Illinois
excluding choice-of-law principles of the law of such State that would require
the application of the laws of a jurisdiction other than such State.
36
<PAGE>
If you are in agreement with the foregoing, please sign the form of
agreement on the accompanying counterpart of this Agreement and return it to the
Company, whereupon the foregoing shall become a binding agreement between you
and the Company.
Very truly yours,
APTARGROUP, INC.
By: /s/ Stephen J. Hagge
----------------------------------
Name: Stephen J. Hagge
--------------------------------
Title: Executive Vice President and
--------------------------------
CFO, Secretary and Treasurer
--------------------------------
S-1
<PAGE>
The foregoing is agreed
to as of the date thereof.
MASSACHUSETTS MUTUAL LIFE
INSURANCE COMPANY
By: /s/ Mary Ann McCarthy
----------------------------
Name: Mary Ann McCarthy
----------------------------
Title: Managing Director
----------------------------
C.M. LIFE INSURANCE COMPANY
By: /s/ Mary Ann McCarthy
----------------------------
Name: Mary Ann McCarthy
----------------------------
Title: Investment Officer
----------------------------
GENERAL AMERICAN LIFE INSURANCE
COMPANY
BY: CONNING ASSET MANAGEMENT COMPANY
By: /s/ Laura R. Caro
----------------------------
Name: Laura R. Caro
----------------------------
Title: Senior Vice President
----------------------------
GENERAL AMERICAN LIFE INSURANCE
COMPANY SEPARATE ACCOUNT 9
BY: CONNING ASSET MANAGEMENT COMPANY
By: /s/ Laura R. Caro
----------------------------
Name: Laura R. Caro
----------------------------
Title: Senior Vice President
----------------------------
RGA REINSURANCE COMPANY
BY: CONNING ASSET MANAGEMENT
COMPANY
By: /s/ Laura R. Caro
----------------------------
S-2
<PAGE>
Name: Laura R. Caro
----------------------------
Title: Senior Vice President
----------------------------
COVA FINANCIAL LIFE INSURANCE
COMPANY
BY: CONNING ASSET MANAGEMENT
COMPANY
By: /s/ Laura R. Caro
----------------------------
Name: Laura R. Caro
----------------------------
Title: Senior Vice President
----------------------------
COVA FINANCIAL SERVICES LIFE
INSURANCE COMPANY
BY: CONNING ASSET MANAGEMENT
COMPANY
By: /s/ Laura R. Caro
----------------------------
Name: Laura R. Caro
----------------------------
Title: Senior Vice President
----------------------------
WASHINGTON UNIVERSITY
BY: CONNING ASSET MANAGEMENT
COMPANY
By: /s/ Laura R. Caro
----------------------------
Name: Laura R. Caro
----------------------------
Title: Senior Vice President
----------------------------
SUN LIFE ASSURANCE COMPANY OF
CANADA
By: /s/ John N. Whelihan
----------------------------
Name: John N. Whelihan
----------------------------
Title: Vice President, U.S. Private
----------------------------
Placements - for President
----------------------------
S-3
<PAGE>
By: /s/ Julia H. Holloway
------------------------------
Name: Julia H. Holloway
------------------------------
Title: Senior Counsel - for Secretary
------------------------------
STATE FARM LIFE INSURANCE COMPANY
By: /s/ Lyle Triebwasser By: /s/ Larry Rottunda
------------------------------ ------------------------------
Name: Lyle Triebwasser Name: Larry Rottunda
------------------------------ ------------------------------
Title: Senior Investment Officer Title: Assistant Secretary
------------------------------ ------------------------------
NATIONWIDE INDEMNITY COMPANY
By: /s/ Mark W. Poeppelman
------------------------------
Name: Mark W. Poeppelman
------------------------------
Title: Authorized Signatory
------------------------------
AMCO INSURANCE COMPANY
By: /s/ Mark W. Poeppelman
------------------------------
Name: Mark W. Poeppelman
------------------------------
Title: Authorized Signatory
------------------------------
NATIONWIDE LIFE INSURANCE COMPANY
By: /s/ Mark W. Poeppelman
------------------------------
Name: Mark W. Poeppelman
------------------------------
Title: Authorized Signatory
------------------------------
LUTHERAN BROTHERHOOD
By: /s/ Mark O. Swenson
------------------------------
Name: Mark O. Swenson
------------------------------
Title: Assistant Vice President
------------------------------
S-4
<PAGE>
MUTUAL TRUST LIFE INSURANCE COMPANY
BY: ADVANTUS CAPITAL MANAGEMENT, INC.
By: /s/ Dianne Orbison
------------------------------
Name: Dianne Orbison
------------------------------
Title: Vice President
------------------------------
NATIONAL TRAVELERS LIFE COMPANY
BY: ADVANTUS CAPITAL MANAGEMENT, INC.
By: /s/ Dianne Orbison
------------------------------
Name: Dianne Orbison
------------------------------
Title: Vice President
------------------------------
GUARANTEE RESERVE LIFE INSURANCE
COMPANY
BY: ADVANTUS CAPITAL MANAGEMENT, INC.
By: /s/ Dianne Orbison
------------------------------
Name: Dianne Orbison
------------------------------
Title: Vice President
------------------------------
PIONEER MUTUAL LIFE INSURANCE COMPANY
BY: ADVANTUS CAPITAL MANAGEMENT, INC.
By: /s/ Dianne Orbison
------------------------------
Name: Dianne Orbison
------------------------------
Title: Vice President
------------------------------
THE CATHOLIC AID ASSOCIATION
BY: ADVANTUS CAPITAL MANAGEMENT, INC.
By: /s/ Loren Haugland
------------------------------
Name: Loren Haugland
------------------------------
Title: Vice President
------------------------------
S-5
<PAGE>
GREAT WESTERN INSURANCE COMPANY
BY: ADVANTUS CAPITAL MANAGEMENT, INC.
By: /s/ Loren Haugland
------------------------------
Name: Loren Haugland
------------------------------
Title: Vice President
------------------------------
PROTECTED HOME MUTUAL LIFE INSURANCE
COMPANY
BY: ADVANTUS CAPITAL MANAGEMENT, INC.
By: /s/ Loren Haugland
------------------------------
Name: Loren Haugland
------------------------------
Title: Vice President
------------------------------
AMERICAN FAMILY LIFE INSURANCE COMPANY
By: /s/ Phillip Hannifan
------------------------------
Name: Phillip Hannifan
------------------------------
Title: Investment Director
------------------------------
TMG LIFE INSURANCE COMPANY
By: /s/ Constance L. Keller
------------------------------
Name: Constance L. Keller
------------------------------
Title: Director, Private Placements
------------------------------
By: /s/ Michael J. Steppe
------------------------------
Name: Michael J. Steppe
------------------------------
Title: Senior Vice President
------------------------------
S-6
<PAGE>
SCHEDULE A
----------
INFORMATION RELATING TO PURCHASERS
Principal Amount of
Name and Address of Purchaser Notes to be Purchased
- ----------------------------- ---------------------
MASSACHUSETTS MUTUAL LIFE INSURANCE COMPANY $15,500,000
Register Notes in the name of: Massachusetts Mutual Life Insurance Company
(1) All payments on account of the Note shall be made by crediting in the form
of bank wire transfer of Federal or other immediately available funds
(identifying each payment as AptarGroup, Inc., 6.62% Series 1999-A Senior
Notes due 2011, interest and principal) to:
Citibank, N.A.
111 Wall Street
New York, NY 10043
ABA No. 021000089
For MassMutual Long-Term Pool
Account No. 4067-3488
Re: AptarGroup, Inc. 6.62% Series 1999-A Senior Notes due 2011, principal
and interest split
With telephone advice of payment to the Securities Custody and Collection
Department of Massachusetts Mutual Life Insurance Company at (413) 744-3561
(2) All notices and communications (except notices with respect to payments)
to:
Massachusetts Mutual Life
Insurance Company
1295 State Street
Springfield, MA 01111
Attn: Securities Investment Division
(3) Notices with respect to payments:
Massachusetts Mutual Life
Insurance Company
1295 State Street
Springfield, MA 01111
Attention: Securities Custody
and Collection Department F 381
Tax ID #04-1590850
Schedule A
<PAGE>
SCHEDULE A
----------
INFORMATION RELATING TO PURCHASERS
Principal Amount of
Name and Address of Purchaser Notes to be Purchased
- ----------------------------- ---------------------
MASSACHUSETTS MUTUAL LIFE INSURANCE COMPANY $2,500,000
Register Notes in the name of: Massachusetts Mutual Life Insurance Company
(1) All payments on account of the Note shall be made by crediting in the form
of bank wire transfer of Federal or other immediately available funds
(identifying each payment as AptarGroup, Inc., 6.62% Series 1999-A Senior
Notes due 2011, interest and principal) to:
Chase Manhattan Bank, N.A.
4 Chase MetroTech Center
New York, NY 10081
ABA No. 021000021
For MassMutual Pension Management
Account No. 910-2594018
Re: AptarGroup, Inc. 6.62% Series 1999-A Senior Notes due 2011, principal
and interest split
With telephone advice of payment to the Securities Custody and Collection
Department of Massachusetts Mutual Life Insurance Company at (413) 744-3561
(2) All notices and communications (except notices with respect to payments)
to:
Massachusetts Mutual Life
Insurance Company
1295 State Street
Springfield, MA 01111
Attn: Securities Investment Division
(3) Notices with respect to payments:
Massachusetts Mutual Life
Insurance Company
1295 State Street
Springfield, MA 01111
Attention: Securities Custody
and Collection Department F 381
Tax ID #04-1590850
2
Schedule A
<PAGE>
SCHEDULE A
----------
INFORMATION RELATING TO PURCHASERS
Principal Amount of
Name and Address of Purchaser Notes to be Purchased
- ----------------------------- ---------------------
C.M. LIFE INSURANCE COMPANY $2,000,000
Register Notes in the name of: C.M. Life Insurance Company
(1) All payments on account of the Note shall be made by crediting in the form
of bank wire transfer of Federal or other immediately available funds
(identifying each payment as AptarGroup, Inc., 6.62% Series 1999-A Senior
Notes due 2011, interest and principal) to:
Citibank, N.A.
111 Wall Street
New York, NY 10043
ABA No. 021000089
For Segment 43 - Universal Life
Account No. 4068-6561
Re: AptarGroup, Inc. 6.62% Series 1999-A Senior Notes due 2011, principal
and interest split
With telephone advice of payment to the Securities Custody and Collection
Department of Massachusetts Mutual Life Insurance Company at (413) 744-3561
(2) All notices and communications (except notices with respect to payments)
to:
C.M. Life Insurance Company
c/o Massachusetts Mutual Life Insurance Company
1295 State Street
Springfield, MA 01111
Attn: Securities Investment Division
(3) Notices with respect to payments:
C.M. Life Insurance Company
c/o Massachusetts Mutual Life Insurance Company
1295 State Street
Springfield, MA 01111
Attention: Securities Custody
and Collection Department F 381
Tax ID #06-1041383
3
Schedule A
<PAGE>
SCHEDULE A
----------
INFORMATION RELATING TO PURCHASERS
Principal Amount of
Name and Address of Purchaser Notes to be Purchased
- ----------------------------- ---------------------
GENERAL AMERICAN LIFE INSURANCE COMPANY $3,000,000
Register Notes in the name of: GALICO
(1) Wire transfer information:
General American Life Insurance Company
c/o The Bank of New York
ABA #021000018 BNF: IOC566
Attn: P&I Department
(2) Notices regarding payments:
Conning Asset Management GALICO
Attn: Investment Accounting AND c/o The Bank of New York
P.O. Box 418 P.O. Box 19266
St. Louis, MO 63166 Newark, NJ 07195
(3) All other notices:
Conning Asset Management GALICO
Attn: Securities Division AND c/o The Bank of New York
P.O. Box 396 P.O. Box 19266
St. Louis, MO 63166 Newark, NJ 07195
(4) Deliver original Note to:
The Bank of New York
Attn: Free Receive
One Wall Street, 5th Floor
New York, NY 10004
For the account of General American Life
Insurance Company, General Account #128800
If there is a problem, call Lucille Del Terzo at The Bank of New York (212)
495-2404.
Tax I.D. #43-0285930
4
Schedule A
<PAGE>
SCHEDULE A
----------
INFORMATION RELATING TO PURCHASERS
Principal Amount of
Name and Address of Purchaser Notes to be Purchased
- ----------------------------- ---------------------
GENERAL AMERICAN LIFE INSURANCE COMPANY, $1,000,000
SEPARATE ACCOUNT 9
Register Notes in the name of: General American Life Insurance Company, Separate
Account 9
(1) Wire transfer information:
General American Life Insurance Company
c/o The Bank of New York
ABA #021000018 BNF: IOC566
Attn: P&I Department
(2) Notices regarding payments:
Conning Asset Management General American Life Insurance Company
Attn: Investment Accounting AND c/o The Bank of New York
P.O. Box 418 P.O. Box 19266
St. Louis, MO 63166 Newark, NJ 07195
(3) All other notices:
Conning Asset Management General American Life Insurance Company
Attn: Securities Division AND c/o The Bank of New York
P.O. Box 396 P.O. Box 19266
St. Louis, MO 63166 Newark, NJ 07195
(4) Deliver original Note to:
The Bank of New York
Attn: Free Receive
One Wall Street, 5th Floor
New York, NY 10004
For the account of General American Life
Insurance Company, Separate Account 9, Account #127703
If there is a problem, call Lucille Del Terzo at The Bank of New York (212)
495-2404.
Tax I.D. #43-0285930
5
Schedule A
<PAGE>
SCHEDULE A
----------
INFORMATION RELATING TO PURCHASERS
Principal Amount of
Name and Address of Purchaser Notes to be Purchased
- ----------------------------- ---------------------
RGA REINSURANCE COMPANY $5,000,000
Register Notes in the name of: RGA Reinsurance Company
(1) Wire transfer information:
General American Life Insurance Company
c/o The Bank of New York
ABA #021000018 BNF: IOC566
Attn: P&I Department
(2) Notices regarding payments:
Conning Asset Management General American Life Insurance Company
Attn: Investment Accounting AND c/o The Bank of New York
P.O. Box 418 P.O. Box 19266
St. Louis, MO 63166 Newark, NJ 07195
(3) All other notices:
Conning Asset Management General American Life Insurance Company
Attn: Securities Division AND c/o The Bank of New York
P.O. Box 396 P.O. Box 19266
St. Louis, MO 63166 Newark, NJ 07195
(4) Deliver original Note to:
The Bank of New York
Attn: Free Receive
One Wall Street, 5th Floor
New York, NY 10004
For the account of RGA Reinsurance Company, Account #127709
If there is a problem, call Lucille Del Terzo at The Bank of New York (212)
495-2404.
Tax I.D. #43-1235868
6
Schedule A
<PAGE>
SCHEDULE A
----------
INFORMATION RELATING TO PURCHASERS
Principal Amount of
Name and Address of Purchaser Notes to be Purchased
- ----------------------------- ---------------------
COVA FINANCIAL LIFE INSURANCE COMPANY $1,000,000
Register Notes in the name of: ELL & CO.
(1) Wire transfer information:
NORTHERN CHGO/Trust
ABA #071000152
Credit wire account #5186041000
Account 26-88761/COVA Financial
(2) Notices regarding payments:
Conning Asset Management COVA Financial Life Insurance Co.
Attn: Investment Accounting AND c/o The Northern Trust Company
P.O. Box 418 P.O. Box 92996
St. Louis, MO 63166 Chicago, IL 60675
(3) All other notices:
Conning Asset Management COVA Financial Life Insurance Co.
Attn: Securities Division AND c/o The Northern Trust Company
P.O. Box 396 P.O. Box 92996
St. Louis, MO 63166 Chicago, IL 60675
(4) Deliver original Note to:
The Northern Trust Company
40 Broad Street, 8th Floor
New York, NY 10004
For the account of COVA Financial Life
Insurance Company, Account #26-88761
Tax I.D. #36-6412623
7
Schedule A
<PAGE>
SCHEDULE A
----------
INFORMATION RELATING TO PURCHASERS
Principal Amount of
Name and Address of Purchaser Notes to be Purchased
- ----------------------------- ---------------------
COVA FINANCIAL SERVICES LIFE INSURANCE COMPANY $6,000,000
Register Notes in the name of: ELL & CO.
(1) Wire transfer information:
NORTHERN CHGO/Trust
ABA #071000152
Credit wire account #5186041000
Account 26-02881/COVA Financial
(2) Notices regarding payments:
<TABLE>
<S> <C>
Conning Asset Management COVA Financial Services Life Insurance Co.
Attn: Investment Accounting AND c/o The Northern Trust Company
P.O. Box 418 P.O. Box 92996
St. Louis, MO 63166 Chicago, IL 60675
</TABLE>
(3) All other notices:
<TABLE>
<S> <C>
Conning Asset Management COVA Financial Services Life Insurance Co.
Attn: Securities Division AND c/o The Northern Trust Company
P.O. Box 396 P.O. Box 92996
St. Louis, MO 63166 Chicago, IL 60675
</TABLE>
(4) Deliver original Note to:
The Northern Trust Company
40 Broad Street, 8th Floor
New York, NY 10004
For the account of COVA Financial Services
Life Insurance Company, Account #26-02881
Tax I.D. #36-6412623
8
Schedule A
<PAGE>
SCHEDULE A
----------
INFORMATION RELATING TO PURCHASERS
Principal Amount of
Name and Address of Purchaser Notes to be Purchased
- ----------------------------- ---------------------
WASHINGTON UNIVERSITY $2,000,000
Register Notes in the name of: PITT & CO.
(1) Wire transfer information:
Bankers Trust Company
ABA 221 001 033
For account 99-401-399
Reference: 038336 A@ 2, Washington University,
for Account 190146
Attn: Veatrice Parker/Asset Collection
(2) Notices regarding payments:
Conning Asset Management Joel Collier
Attn: Investment Accounting AND BT Services Tennessee, Inc.
P.O. Box 418 648 Grassmere Park Rd.
St. Louis, MO 63166 Nashville, TN 37211
(3) All other notices:
Conning Asset Management Joel Collier
Attn: Securities Division AND BT Services Tennessee, Inc.
P.O. Box 396 648 Grassmere Park Rd.
St. Louis, MO 63166 Nashville, TN 37211
(4) Deliver original Note to:
Bankers Trust Company
Attn: Receive Cage
16 Wall Street, 4th Floor, Window 44
New York, NY 10015
For the account of Washington University, Account 190146
Tax I.D. #13-6064419
9
Schedule A
<PAGE>
SCHEDULE A
----------
INFORMATION RELATING TO PURCHASERS
Principal Amount of
Name and Address of Purchaser Notes to be Purchased
- ----------------------------- ---------------------
SUN LIFE ASSURANCE COMPANY OF CANADA $6,000,000
4,000,000
2,500,000
2,000,000
500,000
1,000,000
1,000,000
Register Notes in the name of: Sun Life Assurance Company of Canada
(1) Wire transfers of principal and interest with regard to the Notes:
Bank of New York
P&I Department
ABA #021-000-018
Account #: IOC 566
Re: AptarGroup, Inc.
For Further Credit: IOC 566
All wire transfers are to be accompanied by the PPN (038336 A@ 2) and by
the source and the principal and interest application of the funds.
(2) Written notice of each routine payment and any audit confirmation is to be
sent to:
Sun Life Assurance Company of Canada
Three Sun Life Executive Park
Wellesley Hills, MA 02481
Attention: Manager, Securities Accounting, SC 3327
(3) All other notices and correspondence, including notices of non-routine
payments, are to be forwarded to:
Sun Life Assurance Company of Canada
One Sun Life Executive Park
Wellesley Hills, MA 02481
Attention: Investment Division/Private Placements, SC 1303
10
Schedule A
<PAGE>
(4) Deliver Notes to:
Linda R. Guillette
Sun Life Assurance Company of Canada
One Sun Life Executive Park, SC 1303
Wellesley Hills, MA 02481
Tax I.D. #38-1082080
11
Schedule A
<PAGE>
SCHEDULE A
----------
INFORMATION RELATING TO PURCHASERS
Principal Amount of
Name and Address of Purchaser Notes to be Purchased
- ----------------------------- ---------------------
STATE FARM LIFE INSURANCE COMPANY $15,000,000
Register Notes in the name of: State Farm Life Insurance Company
(1) Wire Transfer Instructions:
The Chase Manhattan Bank
ABA No. 021000021
SSG Private Income Processing
A/C #900-9-000200
For Credit To Account Number G 06893
Ref. PPN: 038336 A@ 2
Rate: 6.62%
Maturity Date: May 30, 2011
(2) Send notices (as well as a photocopy of the original security) to:
State Farm Life Insurance Company
Investment Dept. E-10
One State Farm Plaza
Bloomington, IL 61710
(3) Send confirms to:
State Farm Life Insurance Company
Investment Accounting Dept. D-3
One State Farm Plaza
Bloomington, IL 61710
(4) Send the original security (via registered mail) to:
Chase Manhattan Bank
Attn: Barbara Walsh
(North America Insurance)
3 Chase Metrotech Center-6th Floor
Brooklyn, New York 11245
(5) Send an additional copy of the original security plus an original set of
closing documents and two conformed copies of the Note Purchase Agreement
to:
12
Schedule A
<PAGE>
State Farm Insurance Companies
One State Farm Plaza E-8
Bloomington, Illinois 61710
Attn: Investment Legal E-8
Larry Rottunda, Investment Counsel
Tax I.D. #37-0533090
13
Schedule A
<PAGE>
SCHEDULE A
----------
INFORMATION RELATING TO PURCHASERS
Principal Amount of
Name and Address of Purchaser Notes to be Purchased
- ----------------------------- ---------------------
NATIONWIDE INDEMNITY COMPANY $7,000,000
Register Notes in the name of: Nationwide Indemnity Company
(1) Wiring instructions:
The Bank of New York
ABA #021-000-018
BNF: IOC566
F/A/O Nationwide Indemnity Company
Attn: P&I Department
PPN: 038336 A@ 2
AptarGroup, Inc. 6.62% Senior Notes, Series 1999-A, due May 30, 2011
(2) All notices of payment on or in respect to the security should be sent to:
<TABLE>
<S> <C> <C>
Nationwide Indemnity Company Nationwide Indemnity Company
c/o The Bank of New York With a Attn: Investment Accounting
P.O. Box 19266 copy to: One Nationwide Plaza (1-32-05)
Attn: P&I Department Columbus, Ohio 43215-2220
Newark, NJ 07195
</TABLE>
(3) Send notices and communications to:
Nationwide Indemnity Company
One Nationwide Plaza (1-33-07)
Columbus, Ohio 43215-2220
Attention: Corporate Fixed-Income Securities
(4) Deliver original note to:
The Bank of New York
One Wall Street
3rd Floor - Window A
New York, NY 10286
F/A/O Nationwide Indemnity Company Acct. #264234
Tax I.D. #31-1399201
14
Schedule A
<PAGE>
SCHEDULE A
----------
INFORMATION RELATING TO PURCHASERS
Principal Amount of
Name and Address of Purchaser Notes to be Purchased
- ----------------------------- ---------------------
AMCO INSURANCE COMPANY $1,000,000
Register Notes in the name of: AMCO Insurance Company
(1) Wiring instructions:
The Bank of New York
ABA #021-000-018
BNF: IOC566
F/A/O AMCO Insurance Company
Attn: P&I Department
PPN: 038336 A@ 2
AptarGroup, Inc. 6.62% Senior Notes, Series 1999-A, due May 30, 2011
(2) All notices of payment on or in respect to the security should be sent to:
<TABLE>
<S> <C> <C>
AMCO Insurance Company AMCO Insurance Company
c/o The Bank of New York With a Attn: Investment Accounting
P.O. Box 19266 copy to: One Nationwide Plaza (1-32-05)
Attn: P&I Department Columbus, Ohio 43215-2220
Newark, NJ 07195
</TABLE>
(3) Send notices and communications to:
AMCO Insurance Company
One Nationwide Plaza (1-33-07)
Columbus, Ohio 43215-2220
Attention: Corporate Fixed-Income Securities
(4) Deliver original note to:
The Bank of New York
One Wall Street
3rd Floor - Window A
New York, NY 10286
F/A/O AMCO Insurance Co. Acct. #000611
Tax I.D. #42-6054959
15
Schedule A
<PAGE>
SCHEDULE A
----------
INFORMATION RELATING TO PURCHASERS
Principal Amount of
Name and Address of Purchaser Notes to be Purchased
- ----------------------------- ---------------------
NATIONWIDE LIFE INSURANCE COMPANY $2,000,000
Register Notes in the name of: Nationwide Life Insurance Company
(1) Wiring instructions:
The Bank of New York
ABA #021-000-018
BNF: IOC566
F/A/O Nationwide Life Insurance Company
Attn: P&I Department
PPN: 038336 A@ 2
AptarGroup, Inc. 6.62% Senior Notes, Series 1999-A, due May 30, 2011
(2) All notices of payment on or in respect to the security should be sent to:
<TABLE>
<S> <C> <C>
Nationwide Life Insurance Company Nationwide Life Insurance Company
c/o The Bank of New York With a Attn: Investment Accounting
P.O. Box 19266 copy to: One Nationwide Plaza (1-32-05)
Attn: P&I Department Columbus, Ohio 43215-2220
Newark, NJ 07195
</TABLE>
(3) Send notices and communications to:
Nationwide Life Insurance Company
One Nationwide Plaza (1-33-07)
Columbus, Ohio 43215-2220
Attention: Corporate Fixed-Income Securities
(4) Deliver original note to:
The Bank of New York
One Wall Street
3rd Floor - Window A
New York, NY 10286
F/A/O Nationwide Life Insurance Co. Acct. #267829
Tax I.D. #31-4156830
16
Schedule A
<PAGE>
SCHEDULE A
----------
INFORMATION RELATING TO PURCHASERS
Principal Amount of
Name and Address of Purchaser Notes to be Purchased
- ----------------------------- ---------------------
LUTHERAN BROTHERHOOD $10,000,000
Register Notes in the name of: Lutheran Brotherhood
(1) Payments to:
By wire:
Norwest Bank Minnesota, N.A.
ABA #091000019
For Credit to Trust Clearing Account #0000840245
Attn: Sarah Corcoran
For Credit to: Lutheran Brotherhood
Acct. No.: 12651300
By mail:
Lutheran Brotherhood
Norwest Bank Minnesota, N.A.
P.O. Box 1450
NW9919
Minneapolis, MN 55485
All payments must include the following information:
A/C Lutheran Brotherhood
Account No.: 12651300
AptarGroup, Inc. 6.62% Senior Notes, Series 1999-A, due May 30, 2011
Private Placement Number: 038336 A@ 2
Reference Purpose of Payment
Interest and/or Principal Breakdown
(2) Notices of payments and written confirmation of such wire transfers to:
Lutheran Brotherhood
Attn: Investment Accounting/Trading Administrator
625 Fourth Avenue South
10th Floor
Minneapolis, MN 55415
17
Schedule A
<PAGE>
(3) All other communications to:
Lutheran Brotherhood
Attn: Investment Division
625 Fourth Avenue South
Minneapolis, MN 55415
Telecopier: (612) 340-5776
(4) Deliver original note to:
Norwest Bank Minnesota, N.A.
733 Marquette Avenue
Attn: Client Services - Sarah Corcoran
5th Floor, Window 1
Investors Building
Minneapolis, MN 55479-0051
Telecopier: (612) 667-0550
With a copy to the Lutheran Brotherhood in-house attorney.
Tax I.D. #41-0385700
18
Schedule A
<PAGE>
SCHEDULE A
----------
INFORMATION RELATING TO PURCHASERS
Principal Amount of
Name and Address of Purchaser Notes to be Purchased
- ----------------------------- ---------------------
MUTUAL TRUST LIFE INSURANCE COMPANY $2,000,000
Register Notes in the name of: ELL & CO.
(1) All payments on account of the Notes shall be made by wire transfer of
immediately available funds to:
The Northern Chgo/Trust
ABA #071-000-152
For credit to: Account Number 5186041000
For further credit to: Mutual Trust Life Insurance Company
Account Number: 26-00621
Attn: Income Collections
Reference sufficient information to identify the source and application of
such funds.
(2) All notices and statements should be sent to the following address:
Mutual Trust Life Insurance Company
c/o Advantus Capital Management, Inc.
400 Robert Street North
St. Paul, MN 55101
Attn: Client Administrator
(3) Deliver original Note to:
Northern Trust Company of New York
40 Broad Street, 8th Floor
New York, NY 10004
Attn: Settlements for Account #26-00621,
Mutual Trust Life Ins. Company
Tax I.D. #36-1516780
19
Schedule A
<PAGE>
SCHEDULE A
----------
INFORMATION RELATING TO PURCHASERS
Principal Amount of
Name and Address of Purchaser Notes to be Purchased
- ----------------------------- ---------------------
NATIONAL TRAVELERS LIFE COMPANY $1,000,000
Register Notes in the name of: VAR & CO.
(1) All payments on account of the Notes shall be made by wire transfer of
immediately available funds to:
U.S. Bank, N.A.
Minneapolis, MN
ABA #091-000-022
For credit to: U.S. Bank Trust, N.A.
Account Number: 180121167365,
TSU: 47300050
For further credit to: National Travelers Life Company
Account Number: 12609110
Attn: Juleah Foss (651) 244-5958
Reference sufficient information to identify the source and application of
such funds.
(2) All notices and statements should be sent to the following address:
National Travelers Life Company
c/o Advantus Capital Management, Inc.
400 Robert Street North
St. Paul, MN 55101
Attn: Client Administrator
(3) Deliver original Note to:
U.S. Bank Trust, N.A.
180 East Fifth Street
St. Paul, MN 55101
Attn: Connie Kemp (SPFT 0901)
Tax I.D. #42-0432940
20
Schedule A
<PAGE>
SCHEDULE A
----------
INFORMATION RELATING TO PURCHASERS
Principal Amount of
Name and Address of Purchaser Notes to be Purchased
- ----------------------------- ---------------------
GUARANTEE RESERVE LIFE INSURANCE COMPANY $1,000,000
Register Notes in the name of: GANT & CO.
(1) All payments on account of the Notes shall be made by wire transfer of
immediately available funds to:
Mercantile National Bank of Indiana
Hammond, IN
ABA #071-912-813
For credit to: Guarantee Reserve Life Insurance Company
Attn: Trust Department, Geneva DeVine
Account Number: 287000
Reference sufficient information to identify the source and application of
such funds.
(2) All notices and statements should be sent to the following address:
Guarantee Reserve Life Insurance Company
c/o Advantus Capital Management, Inc.
400 Robert Street North
St. Paul, MN 55101
Attn: Client Administrator
(3) Deliver original Note to:
Mercantile National Bank of Indiana
Ref: Guarantee Reserve Life Insurance Company
5243 Hohman Avenue
Hammond, IN 46320
Tax I.D. #35-0815760
21
Schedule A
<PAGE>
SCHEDULE A
----------
INFORMATION RELATING TO PURCHASERS
Principal Amount of
Name and Address of Purchaser Notes to be Purchased
- ----------------------------- ---------------------
PIONEER MUTUAL LIFE INSURANCE COMPANY $1,000,000
Register Notes in the name of: POLLY & CO.
(1) All payments on account of the Notes shall be made by wire transfer of
immediately available funds to:
Polly & Co.
c/o The Bank of New York
ABA #021-000-018 BNF: IOC566
Attn: P&I Dept., Robert Hoover
Reference sufficient information to identify the source and application of
such funds.
(2) All notices and statements should be sent to the following address:
Pioneer Mutual Life Insurance Company
c/o Advantus Capital Management, Inc.
400 Robert Street North
St. Paul, MN 55101
Attn: Client Administrator
(3) Deliver original Note to:
The Bank of New York
One Wall Street - 3rd Floor - Window A
New York, NY 10005
Account: NCT & Co. Fargo, #270576
Attention: Christine Burke
Telephone: (212) 635-4549
With reference to "FREE DELIVERY"
Tax I.D. #45-0220640
22
Schedule A
<PAGE>
SCHEDULE A
----------
INFORMATION RELATING TO PURCHASERS
Principal Amount of
Name and Address of Purchaser Notes to be Purchased
- ----------------------------- ---------------------
THE CATHOLIC AID ASSOCIATION $1,000,000
Register Notes in the name of: VAR & CO.
(1) All payments on account of the Notes shall be made by wire transfer of
immediately available funds to:
U.S. Bank, N.A.
Minneapolis, MN
ABA #091-000-022
For credit to: U.S. Bank Trust, N.A.
Account Number: 180121167365,
TSU: 47300050
For further credit to: Catholic Aid Association (The)
Account Number: 12614950
Attn: Juleah Foss (651) 244-5958
Reference sufficient information to identify the source and application of
such funds.
(2) All notices and statements should be sent to the following address:
Catholic Aid Association (The)
c/o Advantus Capital Management, Inc.
400 Robert Street North
St. Paul, MN 55101
Attn: Client Administrator
(3) Deliver original Note to:
U.S. Bank Trust, N.A.
180 East Fifth Street
St. Paul, MN 55101
Attn: Marilyn Goldberg (SPFT 0901)
Tax I.D. #41-0182070
23
Schedule A
<PAGE>
SCHEDULE A
----------
INFORMATION RELATING TO PURCHASERS
Principal Amount of
Name and Address of Purchaser Notes to be Purchased
- ----------------------------- ---------------------
GREAT WESTERN INSURANCE COMPANY $500,000
Register Notes in the name of: Zions First National Bank for Great Western
Insurance Company
(1) All payments on account of the Notes shall be made by wire transfer of
immediately available funds to:
Zions First National Bank
Salt Lake City, UT
ABA #124-0000-54
For credit to: Great Western Insurance Company, Account Number: 80-
00005-2
Reference sufficient information to identify the source and application of
such funds.
Any checks (in lieu of wire transfer) should be sent to the following
address:
Zions First National - Bank Trust Department
P.O. Box 30880
Salt Lake City, UT 84130
Ref: Great Western Insurance Company
(2) All notices and statements should be sent to the following address:
Great Western Insurance Company
c/o Advantus Capital Management, Inc.
400 Robert Street North
St. Paul, MN 55101
Attn: Client Administrator
(3) Deliver original Note to:
Great Western Insurance Company
Attn: Fred Meese
3434 Washington Boulevard
Ogden, UT 84401
Tax I.D. #87-0395954
24
Schedule A
<PAGE>
SCHEDULE A
----------
INFORMATION RELATING TO PURCHASERS
Principal Amount of
Name and Address of Purchaser Notes to be Purchased
- ----------------------------- ---------------------
PROTECTED HOME MUTUAL LIFE INSURANCE COMPANY $500,000
Register Notes in the name of: Norwest Bank MN as Custodian for Protected Home
Mutual Life Insurance Co.
(1) All payments on account of the Notes shall be made by wire transfer of
immediately available funds to:
Norwest Bank Minnesota, N.A.
ABA No. 091-000-019
BNF=Norwest Trust Clearing Mpls
BNFA=0840245
OBI=FFC to: Norwest Client Acct. No. 13371700
Norwest Client Account Name: Protected Home Mutual Life Insurance Company
Reference sufficient information to identify the source and application of
such funds.
(2) All notices and statements should be sent to the following address:
Protected Home Mutual Life Insurance Company
c/o Advantus Capital Management, Inc.
400 Robert Street North
St. Paul, MN 55101
Attn: Client Administrator
(3) Deliver original Note to:
Norwest Bank MN, N.A.
733 Marquette Ave. Lower Level 1
Security Control and Transfer
Minneapolis, MN 55479-0051
Attn: Terrie Loosen (612) 667-0540
Tax I.D. #25-0740310
25
Schedule A
<PAGE>
SCHEDULE A
----------
INFORMATION RELATING TO PURCHASERS
Principal Amount of
Name and Address of Purchaser Notes to be Purchased
- ----------------------------- ---------------------
AMERICAN FAMILY LIFE INSURANCE COMPANY $5,000,000
Register Notes in the name of: BAND & CO.
(1) All payments in respect of the Notes to be by bank wire transfer of Federal
or other immediately available funds to:
Firstar Bank Milwaukee, N.A.
Account of Firstar Trust Company
ABA #075000022
For Credit to Account #112-950-027
Trust Account 000018012500 for AFLIC-Traditional Portfolio
Attn: Accounting Department
Each such wire transfer shall set forth the name of the Company, the full
title (including the coupon rate and final maturity date) of the Notes, and
the due date and application among principal and interest of the payment
-------------------------------------------------------
being made.
----------
(2) All notices and communications, including notices with respect to payments
and written confirmation of each such payment as well as quarterly and
annual financial statements to:
American Family Life Insurance Company
6000 American Parkway
Madison, WI 53783-0001
Attn: Investment Division-Private Placements
(3) Delivery of Notes to:
Firstar Bank Milwaukee
Robin Brahm, Manager Services
11th Floor, (414) 765-5177
777 East Wisconsin Avenue
Milwaukee, WI 53202
A specimen copy of each Note to be sent to American Family Life Insurance
Company
Tax I.D. #39-6040365
26
Schedule A
<PAGE>
SCHEDULE A
----------
INFORMATION RELATING TO PURCHASERS
Principal Amount of
Name and Address of Purchaser Notes to be Purchased
- ----------------------------- ---------------------
TMG LIFE INSURANCE COMPANY $5,000,000
Register Notes in the name of: TMG Life Insurance Company
(1) All payments on account of the Notes shall be made by wire transfer of
immediately available funds to:
ABA Routing Transit Number: Norwest Bank Minnesota,
*(field 3400) 091000019
Beneficiary Account Number: 0000840245 (Must be 10 digits in length)
Beneficiary Account Name: Trust Wire Clearing (Must be on line 2)
*(field 4200)
OBI FFC: I.C. 12250600 AptarGroup, Inc.
PPN: 038336 A@ 2
*(field 6000) P= I=
End Balance=
*Federal Reserve Field Tag Numbers
(2) All notices in respect of payment shall be delivered to:
TMG Life Insurance Company
c/o The Mutual Group (U.S.), Inc.
Attn: Tamie Greenwood
401 North Executive Drive, Suite 300
Brookfield, WI 53008-0503
Telephone: (414) 641-4027
Facsimile: (414) 641-4055
(3) All other communications shall be delivered to:
TMG Life Insurance Company
c/o The Mutual Group (U.S.), Inc.
Attn: Connie Keller
401 North Executive Drive, Suite 300
Brookfield, WI 53008-0503
Telephone: (414) 641-4027
Facsimile: (414) 641-4055
Tax I.D. #45-0208990
27
Schedule A
<PAGE>
SCHEDULE B
----------
DEFINED TERMS
-------------
As used herein, the following terms have the respective meanings set
forth below or set forth in the Section hereof following such term:
"Adjusted Consolidated Net Worth" means, as of any date, Consolidated
Net Worth on such date, but excluding the cumulative amount reflected in
"accumulated other comprehensive income" reported in the consolidated total
stockholders' equity of the Company and its Restricted Subsidiaries as
determined in accordance with GAAP.
"Affiliate" means, at any time, and with respect to any Person, (a)
any other Person that at such time directly or indirectly through one or more
intermediaries Controls, or is Controlled by, or is under common Control with,
such first Person, and (b) any Person beneficially owning or holding, directly
or indirectly, 10% or more of any class of voting or equity interests of the
Company or any Subsidiary or any corporation of which the Company and its
Subsidiaries beneficially own or hold, in the aggregate, directly or indirectly,
10% or more of any class of voting or equity interests. As used in this
definition, "Control" means the possession, directly or indirectly, 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.
Unless the context otherwise clearly requires, any reference to an "Affiliate"
is a reference to an Affiliate of the Company.
"Business Day" means (a) for the purposes of Section 8.6 only, any day
other than a Saturday, a Sunday or a day on which commercial banks in New York
City are required or authorized to be closed, and (b) for the purposes of any
other provision of this Agreement, any day other than a Saturday, a Sunday or a
day on which commercial banks in Chicago, Illinois or New York City are required
or authorized to be closed.
"Capital Lease" means, at any time, a lease with respect to which the
lessee is required concurrently to recognize the acquisition of an asset and the
incurrence of a liability in accordance with GAAP.
"Closing" is defined in Section 3.
"Code" means the Internal Revenue Code of 1986, as amended from time
to time, and the rules and regulations promulgated thereunder from time to time.
"Company" means AptarGroup, Inc., a Delaware corporation.
"Confidential Information" is defined in Section 20.
"Consolidated Indebtedness" means, as of any date, Indebtedness of the
Company and its Restricted Subsidiaries as of such date determined on a
consolidated basis in accordance with GAAP.
Schedule B
<PAGE>
"Consolidated Net Worth" means, as of any date, consolidated total
stockholders' equity of the Company and its Restricted Subsidiaries on such
date, determined in accordance with GAAP, less the amount by which outstanding
Restricted Investments on such date exceed 25% of consolidated total
stockholders equity of the Company and its Restricted Subsidiaries determined in
accordance with GAAP.
"Consolidated Total Assets" means, as of any date, the assets and
properties of the Company and its Restricted Subsidiaries as of such date
determined on a consolidated basis in accordance with GAAP.
"Consolidated Total Capitalization" means, as of any date, the sum of
Consolidated Indebtedness and Consolidated Net Worth as of such date.
"Default" means an event or condition the occurrence or existence of
which would, with the lapse of time or the giving of notice or both, become an
Event of Default.
"Default Rate" means that rate of interest that is the greater of (i)
2% per annum above the rate of interest stated in clause (a) of the first
paragraph of the Notes or (ii) 2% over the rate of interest publicly announced
by Bank of America in Chicago, Illinois as its "base" or "prime" rate.
"Disposition" is defined in Section 10.4.
"Environmental Laws" means any and all Federal, state, local, and
foreign statutes, laws, regulations, ordinances, rules, judgments, orders,
decrees, permits, concessions, grants, franchises, licenses, agreements or
governmental restrictions relating to pollution and the protection of the
environment or the release of any materials into the environment, including but
not limited to those related to hazardous substances or wastes, air emissions
and discharges to waste or public systems.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and the rules and regulations promulgated thereunder
from time to time in effect.
"ERISA Affiliate" means any trade or business (whether or not
incorporated) that is treated as a single employer together with the Company
under section 414 of the Code.
"Event of Default" is defined in Section 11.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"GAAP" means generally accepted accounting principles as in effect
from time to time in the United States of America.
2
Schedule B
<PAGE>
"Governmental Authority" means
(a) the government of
(i) the United States of America or any State or other political
subdivision thereof, or
(ii) any jurisdiction in which the Company or any Subsidiary
conducts all or any part of its business, or which asserts
jurisdiction over any properties of the Company or any Subsidiary, or
(b) any entity exercising executive, legislative, judicial, regulatory
or administrative functions of, or pertaining to, any such government.
"Guaranty" means, with respect to any Person, any obligation (except
the endorsement in the ordinary course of business of negotiable instruments for
deposit or collection) of such Person guaranteeing or in effect guaranteeing any
indebtedness, dividend or other obligation of any other Person in any manner,
whether directly or indirectly, including (without limitation) obligations
incurred through an agreement, contingent or otherwise, by such Person:
(a) to purchase such indebtedness or obligation or any property
constituting security therefor;
(b) to advance or supply funds (i) for the purchase or payment of such
indebtedness or obligation, or (ii) to maintain any working capital or
other balance sheet condition or any income statement condition of any
other Person or otherwise to advance or make available funds for the
purchase or payment of such indebtedness or obligation;
(c) to lease properties or to purchase properties or services
primarily for the purpose of assuring the owner of such indebtedness or
obligation of the ability of any other Person to make payment of the
indebtedness or obligation; or
(d) otherwise to assure the owner of such indebtedness or obligation
against loss in respect thereof.
In any computation of the indebtedness or other liabilities of the obligor under
any Guaranty, the indebtedness or other obligations that are the subject of such
Guaranty shall be assumed to be direct obligations of such obligor.
"Hazardous Material" means any and all pollutants, toxic or hazardous
wastes or any other substances that might pose a hazard to health or safety, the
removal of which may be required or the generation, manufacture, refining,
production, processing, treatment, storage, handling, transportation, transfer,
use, disposal, release, discharge, spillage, seepage, or filtration
3
Schedule B
<PAGE>
of which is or shall be restricted, prohibited or penalized by any applicable
law (including, without limitation, asbestos, urea formaldehyde foam insulation
and polychlorinated biphenyls).
"holder" means, with respect to any Note, the Person in whose name
such Note is registered in the register maintained by the Company pursuant to
Section 13.1.
"Indebtedness" with respect to any Person means, at any time, without
duplication,
(a) its liabilities for borrowed money;
(b) its liabilities for the deferred purchase price of property
acquired by such Person (excluding accounts payable and other accrued
liabilities arising in the ordinary course of business, but including all
liabilities created or arising under any conditional sale or other title
retention agreement with respect to any such property);
(c) all liabilities appearing on its balance sheet in accordance with
GAAP in respect of Capital Leases;
(d) all liabilities for borrowed money secured by any Lien with
respect to any property owned by such Person (whether or not it has assumed
or otherwise become liable for such liabilities); and
(e) any Guaranty of such Person with respect to liabilities of a type
described in any of clauses (a) through (d) hereof.
Indebtedness of any Person shall include all obligations of such Person of the
character described in clauses (a) through (e) to the extent such Person remains
legally liable in respect thereof notwithstanding that any such obligation is
deemed to be extinguished under GAAP.
"Institutional Investor" means (a) any original purchaser of a Note,
(b) any holder of a Note holding more than $2,000,000 in aggregate principal
amount of the Notes, and (c) any bank, trust company, savings and loan
association or other financial institution, any pension plan, any investment
company, any insurance company, any broker or dealer, or any other similar
financial institution or entity, regardless of legal form.
"Investments" means all investments made, in cash or by delivery of
property, directly or indirectly, by any Person, in any other Person or
property, whether by acquisition of shares of capital stock, indebtedness or
other obligations or securities or by loan, advance, capital contribution or
otherwise.
"Lien" means, with respect to any Person, any mortgage, lien, pledge,
charge, security interest or other encumbrance, or any interest or title of any
vendor, lessor, lender or other secured party to or of such Person under any
conditional sale or other title retention agreement or Capital Lease, upon or
with respect to any property or asset of such Person
4
Schedule B
<PAGE>
(including in the case of stock, stockholder agreements, voting trust agreements
and all similar arrangements).
"Make-Whole Amount" is defined in Section 8.6.
"Material" means material in relation to the business, operations,
affairs, financial condition, assets or properties of the Company and its
Restricted Subsidiaries taken as a whole.
"Material Adverse Effect" means a material adverse effect on (a) the
business, operations, affairs, financial condition, assets or properties of the
Company and its Restricted Subsidiaries taken as a whole, or (b) the ability of
the Company to perform its obligations under this Agreement and the Notes, or
(c) the validity or enforceability of this Agreement or the Notes.
"Memorandum" is defined in Section 5.3.
"Multiemployer Plan" means any Plan that is a "multiemployer plan" (as
such term is defined in section 4001(a)(3) of ERISA).
"Notes" is defined in Section 1.1.
"Officer's Certificate" means a certificate of a Senior Financial
Officer or of any other officer of the Company whose responsibilities extend to
the subject matter of such certificate.
"Other Purchasers" is defined in Section 2.
"PBGC" means the Pension Benefit Guaranty Corporation referred to and
defined in ERISA or any successor thereto.
"Person" means an individual, partnership, corporation, limited
liability company, association, trust, unincorporated organization, or a
government or agency or political subdivision thereof.
"Plan" means an "employee benefit plan" (as defined in section 3(3) of
ERISA) that is or, within the preceding five years, has been established or
maintained, or to which contributions are or, within the preceding five years,
have been made or required to be made, by the Company or any ERISA Affiliate or
with respect to which the Company or any ERISA Affiliate may have any liability.
"property" or "properties" means, unless otherwise specifically
limited, real or personal property of any kind, tangible or intangible, choate
or inchoate.
"Purchaser" means each purchaser listed in Schedule A.
5
Schedule B
<PAGE>
"QPAM Exemption" means Prohibited Transaction Class Exemption 84-14
issued by the United States Department of Labor.
"Required Holders" means, at any time, the holders of more than 50% in
principal amount of the Notes at the time outstanding (exclusive of Notes then
owned by the Company or any of its Affiliates).
"Responsible Officer" means any Senior Financial Officer and any other
officer of the Company with responsibility for the administration of the
relevant portion of this agreement.
"Restricted Investments" means all Investments of the Company and its
Restricted Subsidiaries, other than:
(a) property or assets to be used or consumed in the ordinary course
of business;
(b) assets arising from the sale of goods or services in the ordinary
course of business;
(c) Investments in Restricted Subsidiaries or in any Person that, as a
result thereof, becomes a Restricted Subsidiary;
(d) Investments existing as of the date of this Agreement that are
listed in the attached Schedule B-1;
(e) Investments in treasury stock;
(f) Investments in:
(i) obligations, maturing within one year from the date of
acquisition, of or fully guaranteed by (A) the United States of
America or an agency thereof or (B) Canada or a province thereof;
(ii) state or municipal securities having an effective maturity
within one year from the date of acquisition that are rated in one of
the top two rating classifications by at least one nationally
recognized rating agency;
(iii) certificates of deposit or banker's acceptances maturing
within one year from the date of acquisition of or issued by
commercial banks whose long-term unsecured debt obligations (or the
long-term unsecured debt obligations of the bank holding company
owning all of the capital stock of such bank) are rated in one of the
top two rating classifications by at least one nationally recognized
rating agency;
6
Schedule B
<PAGE>
(iv) commercial paper maturing within 270 days from the date of
issuance that, at the time of acquisition, is rated in one of the top
two rating classifications by at least one nationally recognized
rating agency;
(v) repurchase agreements, fully collateralized with obligations
of the type described in clause (i), with a bank satisfying the
requirements of clause (iii);
(vi) money market instrument programs that are properly
classified as current assets in accordance with GAAP; and
(g) loans or advances made in the ordinary course of business to
officers and employees (including moving expenses related to relocation)
incidental to carrying on the business of the Company or a Restricted
Subsidiary.
"Restricted Subsidiary" means any Subsidiary (a) of which at least a
majority of the voting securities are owned by the Company and/or one or more
Wholly-Owned Restricted Subsidiaries and (b) that the Company has not designated
an Unrestricted Subsidiary.
"Securities Act" means the Securities Act of 1933, as amended from
time to time.
"Senior Financial Officer" means the chief financial officer,
principal accounting officer, treasurer or comptroller of the Company.
"Series 1999-A Notes" is defined in Section 1.2.
"Significant Subsidiary" means, as of the date of determination, any
Restricted Subsidiary the assets or revenues of which account for more than 10%
of Consolidated Total Assets at the end of the most recently ended fiscal period
or more than 10% of the consolidated revenues of the Company and its Restricted
Subsidiaries for the most recently completed four fiscal quarters.
"Source" is defined in Section 6.2
"Subsidiary" means, as to any Person, any corporation, association or
other business entity in which such Person or one or more of its Subsidiaries or
such Person and one or more of its Subsidiaries owns sufficient equity or voting
interests to enable it or them (as a group) ordinarily, in the absence of
contingencies, to elect a majority of the directors (or Persons performing
similar functions) of such entity, and any partnership or joint venture if more
than a 50% interest in the profits or capital thereof is owned by such Person or
one or more of its Subsidiaries or such Person and one or more of its
Subsidiaries (unless such partnership can and does ordinarily take major
business actions without the prior approval of such Person or one or more of its
Subsidiaries). Unless the context otherwise clearly requires, any reference to
a "Subsidiary" is a reference to a Subsidiary of the Company.
7
Schedule B
<PAGE>
"Supplement" is defined in Section 1.1.
"this Agreement" or "the Agreement" is defined in Section 17.3.
"Unrestricted Subsidiary" means any Subsidiary of the Company so
designated an Unrestricted Subsidiary by notice in writing given to the holders
of the Notes.
"Wholly-Owned Subsidiary" or "Wholly-Owned Restricted Subsidiary"
mean, at any time, any Subsidiary, or Restricted Subsidiary, as the case may be,
100% of all of the equity interests (except directors' qualifying shares) and
voting interests of which are owned by any one or more of the Company and the
Company's other Wholly-Owned Subsidiaries or Wholly-Owned Restricted
Subsidiaries, as the case may be, at such time.
8
Schedule B
<PAGE>
SCHEDULE B-1
------------
EXISTING INVESTMENTS
Equity investments:
Seaplast (50%) 1,585,681
TES (40%) 74,923
CosterSeaquist LLC (50%) 2,624,757
---------
Subtotal 4,285,361
Other:
Fadeva loan 500,000
---------
Grand Total 4,785,361
=========
Schedule B-1
<PAGE>
SCHEDULE 4.9
------------
CHANGES IN CORPORATE STRUCTURE
NONE
Schedule 4.9
<PAGE>
SCHEDULE 5.3
------------
DISCLOSURE MATERIALS
NONE
Schedule 5.3
<PAGE>
SCHEDULE 5.4
------------
SUBSIDIARIES OF THE COMPANY
AND OWNERSHIP OF SUBSIDIARY STOCK
<TABLE>
<CAPTION>
State or Other
Jurisdiction of Percentage
Incorporation Owned
--------------- ----------
<S> <C> <C>
AptarGroup International L.L.C. Delaware 100%
AptarGroup Foreign Sales Corporation Barbados 100%
AptarGroup Holding S.A. France 100%
Aptar GmbH Germany 100%
Erich Pfeiffer GmbH Germany 100%
Pfeiffer Vaporisateurs France S.a.r.L. France 100%
P & S Japan Ltd. Japan 100%
Pfeiffer (U.K.) Limited United Kingdom 100%
P&P Promotion of German Manufacturing
Technologies GmbH Germany 100%
Vallis Leasobjekt Gesellschaft GmbH Germany 51%
Loeffler Beteilugungs GmbH Germany 100%
Seaplast S.A. * Spain 50%
Seaquist-Loeffler GmbH Germany 100%
Loffler Stet Spol. S.R.O. Czech Republic 100%
SeaquistPerfect Dispensing GmbH Germany 100%
Valois Deutschland GmbH Germany 100%
AptarGroup S.A. France 100%
Aptar South Europe SARL France 100%
Novares S.p.A. Italy 100%
SAR S.p.A Italy 100%
SAR France SCA France 100%
AptarGroup SAR Finance Unlimited Ireland 100%
Sar GmbH Germany 100%
SAR (U.K.) Limited United Kingdom 100%
Tes S.p.A. * Italy 35%
Caideil M.P. Teoranta Ireland 100%
General Plastics S.A. France 100%
Graphocolor France 60%
Moulage Plastique de Normandie S.A. France 100%
Perfect-Valois U.K. Limited United Kingdom 100%
Seaquist-Loeffler Limited United Kingdom 100%
Valois S.A France 100%
Valois Dispray S.A. Switzerland 100%
Valois Espana S.A. Spain 100%
Valois Italiana S.r.l. Italy 100%
Inairic S.A. Argentina 100%
Sar Dispensing Systems Ltd. Hong Kong 100%
SAR Do Brasil Ltda. Brazil 100%
</TABLE>
Schedule 5.4
<PAGE>
SCHEDULE 5.4
------------
SUBSIDIARIES OF THE COMPANY
AND OWNERSHIP OF SUBSIDIARY STOCK
<TABLE>
<CAPTION>
<S> <C> <C>
Seaquist Canada Ltd. Canada 100%
Seaquist Finance Unlimited Ireland 100%
Seaquist-Valois Australia Pty. Ltd. Australia 100%
Seaquist-Valois do Brasil Ltda. Brazil 100%
Seaquist-Valois Japan, Inc. Japan 100%
Aptar Suzhou Dispensing Ltd. P.R. China 100%
CosterSeaquist L.L.C.* Illinois 50%
Emson Research, Inc. Connecticut 100%
Emson Europe Ltd. United Kingdon 100%
Emson Foreign Sales Corporation U.S. Virgin Islands 100%
Emson, Inc. Connecticut 100%
Emson Ventures, Inc. Connecticut 100%
Emson Ventures II, Inc. Connecticut 100%
P.T. Emson Ongko Indonesia Indonesia 100%
Emson Ventures III, Inc. Connecticut 100%
Emson Spraytech India Private Ltd. India 51%
Emson Ventures IV, Inc. Connecticut 100%
Global Precision, Inc. Florida 100%
Liquid Molding Systems, Inc. Delaware 100%
Philson, Inc. Connecticut 100%
Pfeiffer of America, Inc. Delaware 100%
P Merger Corporation Connecticut 100%
R.P.M. Manufacturing Company Connecticut 100%
SAR U.S.A. Inc. Delaware 100%
Seaquist Closures L.L.C. Delaware 100%
Seaquist Closures Foreign, Inc. Delaware 100%
Seaquist de Mexico, S.A. de C.V. Mexico 75%
SeaquistPerfect Dispensing L.L.C. Delaware 100%
SeaquistPerfect Dispensing Foreign, Inc. Delaware 100%
Valois of America, Inc. Connecticut 100%
</TABLE>
* Indicates affiliate of the Company
See the FORM 10-K for the fiscal year ended December 31, 1998 for the executive
officers and the PROXY STATEMENT dated April 7, 1999 for directors.
Schedule 5.4
<PAGE>
SCHEDULE 5.5
------------
FINANCIAL STATEMENTS
AptarGroup, Inc. 10-Q for the quarter ended March 31, 1999
Schedule 5.5
<PAGE>
SCHEDULE 5.8
------------
CERTAIN LITIGATION
None
Schedule 5.8
<PAGE>
SCHEDULE 5.11
-------------
LICENSES, PERMITS, ETC.
None
Schedule 5.11
<PAGE>
SCHEDULE 5.14
-------------
USE OF PROCEEDS
Repay a portion of indebtedness under Credit Agreement dated as of February 12,
1999 between AptarGroup, Inc. and Bank of America National Trust and Savings
Association
$107,000,000
============
Schedule 5.14
<PAGE>
SCHEDULE 5.15
-------------
EXISTING INDEBTEDNESS
<TABLE>
<CAPTION>
Description Secured by Rate - fixed Interest Issue Maturity
Bank name of Debt Assets or variable? Rate Date Date
--------- ----------- ---------- ------------ -------- ----- --------
ST NOTES PAYABLE
<S> <C> <C> <C> <C> <C> <C> <C>
AptarGroup ABN Amro Bank No V 5.35% 01/11/99 04/11/99
AptarGroup Society General Bank No V 5.60% 03/31/99 04/01/99
AptarGroup WLB Bank No V 5.17% 03/30/99 04/06/99
AptarGroup BOA Bank No V 5.42% 2/19/99 04/30/99
China IBPS Bank No V 5.90% 7/16/98 7/15/99
China Bank of China Bank No V 5.77% 7/14/98 7/13/99
China Bank of China Bank No V 6.52% 7/24/98 7/13/99
Elims Reclass ST
Emson Foreign Sales Corp. Fleet Bank No V 0.00% 03/31/99 04/05/99
Emson, Inc. Fleet Bank No V 0.00% 03/31/99 04/05/99
Emson, Inc. Fleet Bank No V 0.00% 03/31/99 04/05/99
Emson, Inc. Fleet Bank No V 0.00% 03/31/99 04/05/99
General plastics BNP Bank No V 3.88% 2/15/98 4/15/99
Novares S p A IMI-S PAOLO Bank N/A F 5.60% 2/98 8/99
Novares S p A IBM Semea Other N/A F 9.35% 10/98 12/99
S Loffler Ltd BOA Bank No V 6.00% 11/2/99 5/5/99
Sar France Groupe Soval Bank No V 10.90% 11/96 5/99
Seaquist Loffler Germany DM Eurokredit Bank No V 3.96% 2/15/99 5/15/99
Seaquist Loffler Germany DB Eurokredit Bank No V 3.96% 3/11/99 6/11/99
SV Australia ABN Amro Bank Yes V 5.35% 3/24/99 5/24/99
SV Australia ABN Amro Bank Yes V 5.38% 3/29/99 4/29/99
Valois CIN Bank No V 3.24% 3/18/99 4/1/99
Valois CIN Bank No V 3.24% 3/19/99 4/1/99
Valois CIN Bank No V 3.23% 3/22/99 4/1/99
DISCOUNTED NOTES
Valois Spain Bilbao Vizcaya Bank No V 7.00% 1/23/99 4/25/99
</TABLE>
<TABLE>
<CAPTION>
LC - ST LC - LT TOTAL - LC US$ - ST US$ - LT TOTAL $
------------------------------------------------------------------------------
OVERDRAFTS
<S> <C> <C> <C> <C> <C> <C>
0 0 0 0 0
AptarGroup 15,000,000 15,000,000 15,000,000 0 15,000,000
AptarGroup 600,000 600,000 600,000 0 600,000
AptarGroup 10,500,000 10,500,000 10,500,000 0 10,500,000
AptarGroup 123,000,000 123,000,000 123,000,000 0 123,000,000
China 828,000 828,000 100,022 0 100,022
China 15,000,000 15,000,000 1,812,000 0 1,812,000
China 10,000,000 10,000,000 1,208,000 0 1,208,000
Elims (25,000,000) (25,000,000) (25,000,000) (25,000,000)
Emson Foreign Sales Corp. 21,641 21,641 21,641 0 21,641
Emson, Inc. 1,084,366 1,084,366 1,084,366 0 1,084,366
Emson, Inc, 104,788 104,788 104,788 0 104,788
Emson, Inc. 45,608 45,608 45,608 0 45,608
General plastics 274,500 274,500 45,070 0 45,070
Novares S p A 5,000,000 5,000,000 2,781,000 0 2,781,000
Novares S p A 677,552 677,552 378,854 0 376,854
S Loffler Ltd 1,300,000 1,300,000 2,095,340 0 2,095,340
Sar France 17,573 17,573 2,885 0 2,885
Seaquist Loffler Germany 2,000,000 2,000,000 1,101,322 0 1,101,322
Seaquist Loffler Germany 2,000,000 2,000,000 1,101,322 0 1,101,322
SV Australia 100,000 100,000 63,430 0 63,430
SV Australia 100,000 100,000 63,430 0 63,430
Valois 2,800,000 2,800,000 459,726 0 459,726
Valois 9,200,000 9,200,000 1,510,530 0 1,510,530
Valois 3,500,000 3,500,000 574,658 0 574,658
---------------------------------------------
138,651,993 0 138,651,993
---------------------------------------------
DISCOUNTED NOTES
Valois Spain 1,005,662 1,005,662 6,510 0 6,510
---------------------------------------------
6,510 0 6,510
---------------------------------------------
</TABLE>
Schedule 5.15
<PAGE>
SCHEDULE 5.15
-------------
<TABLE>
<CAPTION>
EXISTING INDEBTEDNESS
Description Secured by Rate--fixed Interest Issue Maturity
Bank name of Debt Assets or variable Rate Date Date
--------------- ----------- ---------- ----------- -------- -------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
OVERDRAFTS
AAPTUS Other Bank No V 0.00%
Aptar GmbH West LB Bank No V 6.00% 3/31/99 4/1/99
Aptar GmbH ABN Amro Bank No V 6.00% 3/31/99 4/1/99
General Plastics Bred Bank No V 3.80% 3/31/99 3/31/99
General Plastics SG Bank No V 4.20% 3/31/99 3/31/99
Graphocolor Credit Lyonnais Bank No V 3.88% 3/31/99 4/15/99
Graphocolor BNP Bank No V 3.83% 3/31/99 4/15/99
Graphocolor SG Bank No V 0.04% 3/31/99 4/15/99
Inairic BNL Bank Y V 0.18% 2/25/99 2/25/00
Perfect-Valois UK Bank National De Paris Bank No V 7.00% 3/99 Revolving
Seaquist Japan Mitsubishi Bank Bank No V 3.50% 8/29/97 8/28/02
Seaquist Japan Mitsubishi Bank Bank No V 3.50% 6/23/98 6/2/03
Seaquist Japan BNP Bank No V 2.00% 12/18/98 12/31/05
Seaquist Japan Sumitomo Bank Bank No V 2.50% 12/18/98 12/17/03
Seaquist Loffler Germany Volksbank Bank No V 6.25% 3/30/99 4/30/99
SPD France BFCE Bank No V 3.79% 3/31/99 N/A
SPD France SG Bank No V 3.00% 3/31/99 N/A
SPD GmbH West LB Bank No V 6.00% 3/31/99 4/1/99
SPD GmbH ABN Amro Bank No V 6.00% 3/31/98 4/1/99
Valois Credit Lyonnais Bank No V 3.61% 3/31/99 N/A
Valois Credit Agricole Bank No V 3.61% 3/31/99 N/A
Valois SG Bank No V 3.61% 3/31/99 N/A
</TABLE>
<TABLE>
<CAPTION>
LC - ST LC - LT TOTAL - LC US$ - ST US$ - LT TOTAL $
---------- ------- ----------- ---------- -------- ----------
<S> <C> <C> <C> <C> <C> <C>
AAPTUS 2,326,589 2,326,589 2,326,589 0 2,326,589
Aptar GmbH 28,463 28,463 15,673 0 15,673
Aptar GmbH 3 3 2 0 2
General Plastics 339,171 339,171 55,688 0 55,688
General Plastics 1,444,434 1,444,434 237,159 0 237,159
Graphocolor 3,675,862 3,675,862 603,532 0 603,532
Graphocolor 2,456,989 2,456,989 403,408 0 403,408
Graphocolor 424,084 424,084 69,630 0 69,630
Inairic 592,253 592,253 592,549 0 592,549
Perfect-Valois UK 497,073 497,073 801,182 0 801,182
Seaquist Japan 13,673,000 13,673,000 115,045 0 115,045
Seaquist Japan 4,170,000 4,170,000 35,086 0 35,086
Seaquist Japan 306,262,705 306,262,705 2,576,894 0 2,576,894
Seaquist Japan 46,668,000 46,668,000 392,665 0 392,665
Seaquist Loffler Germany 729,348 729,348 401,623 0 401,623
SPD France 177,671 177,671 29,171 0 29,171
SPD France 230,157 230,157 37,789 0 37,789
SPD GmbH 846,377 846,377 466,067 0 466,067
SPD GmbH 1,440,778 1,440,778 793,380 0 793,380
Valois 246,688 246,688 40,503 0 40,503
Valois 2,008,643 2,008,643 329,795 0 329,795
Valois 468,959 468,959 76,997 0 76,997
------------------------------------------
TOTAL OVERDRAFTS 10,400,429 0 10,400,429
------------------------------------------
</TABLE>
Schedule 5.15
<PAGE>
SCHEDULE 5.15
-------------
EXISTING INDEBTEDNESS
<TABLE>
<CAPTION>
Description Secured by Rate - fixed Interest Issue Maturity
Bank name of Debt Assets or variable? Rate Date Date LC - ST LC - LT
--------- ------- ------ ----------- ---- ---- ---- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
NOTES PAYABLE
AptarGroup Nationwide Life Other No F 7.08% 10/1/95 9/30/05 3,571,429 21,428,571
AptarGroup Reclass ST Other No 4/29/01 25,000,000
Enson, Inc. Bank Term Loan Bank No V 6.53% 4/15/98 5/1/03 800,000 2,466,667
Enson, Inc. Revolver Bank No V 5.56% 4/15/98 5/1/01 0 7,700,000
Enson, Inc. Revolver Bank No V 5.46% 4/15/98 5/1/01 0 10,000,000
Enson India Pavron Loan No V 0.00% 0 2,022,022
General Plastics BNP Bank No F 5.11% 8/98 7/03 372,739 1,389,120
General Plastics Bred Bank No F 4.90% 8/97 7/01 100,668 142,115
General Plastics Bred Bank No F 4.90% 8/97 7/01 251,670 355,287
General Plastics Credipar Bank No F 11.08% 11/95 10/99 14,674 0
General Plastics SNVB Codevi Bank No F 6.10% 7/96 7/00 257,500 128,750
General Plastics SNVB Codevi Bank No V 5.60% 8/96 8/00 198,750 99,375
Graphocolor Agency Bassin Other No F 0.50% 10/16/97 10/16/08 42,000 378,000
Graphocolor Agency Bassin Other No F 0.50% 3/26/91 3/16/00 0 106,400
Graphocolor Agency Bassin Other No F 0.50% 1/16/97 1/16/00 0 1,052,800
Graphocolor SDR Other No F 7.20% 1/1/90 1/1/99 190,214 0
Graphocolor CMT Other No V 3.80% 8/20/96 8/20/03 1,232,145 6,160,705
Graphocolor CMT Other No V 3.80% 8/20/96 8/20/03 375,000 1,875,000
MPN Credit General Bank F 0.00% 0 0 0 0
Industriel
MPN Societe General Bank No F 4.95% 8/98 1/00 245,725 646,442
MPN Societe General Bank Yes F 6.10% 6/96 5/00 88,043 109,721
MPN CIC Bank No F 5.40% 8/97 7/01 120,863 171,622
MPN Societe General Bank No V 5.14% 8/97 7/01 276,538 391,488
SAR Loan L Other No F 3.69% 1/13/95 7/29/09 0 1,392,973
SAR Loan I Other No F 0.00% 7/97 1/99 0 0
Seaquist de
Mexico Other Bank Yes F 0.00% 0 0 213,696 136,848
Seaquist
Loffler Germany GEFA 83165 Other No F 4.94% 3/1/97 1/1/99 0 0
Seaquist
Loffler Germany GEFA 83166 Other No F 4.74% 4/1/97 2/1/99 0 0
Seaquist
Loffler Germany GEFA 83167 Other No F 5.70% 12/1/97 10/1/99 101,500 0
Seaquist
Loffler Germany GEFA 83153 Other No F 5.79% 5/1/98 3/1/00 99,000 22,000
Seaquist
Loffler Germany GEFA 83154 Other No F 5.53% 5/1/98 3/1/00 174,150 77,400
Seaquist
Loffler Germany GEFA 83155 Other No F 5.53% 6/1/98 4/1/00 124,470 41,490
Seaquist
Loffler Germany GEFA 83152 Other No F 5.24% 10/1/97 8/1/99 27,500 0
Seaquist
Loffler Germany Loeffler Loan Other No F 4.90% 7/31/98 9/30/04 623,679 6,082,522
Valois ANVAR Bank No F 0.00% 9/4/92 6/30/00 200,000 200,000
Valois Participation Other No F 6.00% 4/1/93 4/1/03 5,406,901 28,744,466
Valois Italiana Mediocredito Bank No V 1.20% 12/31/98 6/30/08 40,000 360,786
Valois of
America CDA Other Yes F 4.50% 11/28/95 6/1/95 91,808 605,240
TOTAL - LC US$ - ST US$ - LT TOTAL $
-------------------------------------------------
<S> <C> <C> <C> <C>
NOTES PAYABLE
AptarGroup 25,000,000 3,571,429 21,428,571 25,000,000
AptarGroup 25,000,000 0 25,000,000 25,000,000
Enson, Inc. 3,266,661 800,000 2,466,667 3,266,667
Enson, Inc. 7,700,000 0 7,700,000 7,700,000
Enson, Inc. 10,000,000 0 10,000,000 10,000,000
Enson India 2,022,022 0 47,659 47,659
General Plastics 1,761,859 61,199 228,077 289,276
General Plastics 242,783 16,528 23,334 39,852
General Plastics 606,957 41,321 58,334 99,655
General Plastics 14,674 2,409 0 2,409
General Plastics 386,250 42,278 21,139 63,418
General Plastics 298,125 32,632 16,316 48,949
Graphocolor 420,000 6,896 62,063 68,959
Graphocolor 106,400 0 17,470 17,470
Graphocolor 1,052,800 0 172,857 172,857
Graphocolor 190,214 31,231 0 31,231
Graphocolor 7,392,850 202,303 1,011,514 1,213,817
Graphocolor 2,250,000 61,571 307,853 369,423
MPN 0 0 0 0
MPN 892,167 40,345 106,138 146,483
MPN 197,764 14,456 18,015 32,470
MPN 292,485 19,844 28,178 48,023
MPN 668,026 45,404 64,278 109,682
SAR 1,392,973 0 774,772 774,772
SAR 0 0 0 0
Seaquist de
Mexico 410,544 28,738 14,369 43,107
Seaquist
Loffler Germany 0 0 0 0
Seaquist
Loffler Germany 0 0 0 0
Seaquist
Loffler Germany 101,500 55,892 0 55,892
Seaquist
Loffler Germany 121,000 54,515 12,115 66,630
Seaquist
Loffler Germany 251,550 95,898 42,621 138,519
Seaquist
Loffler Germany 165,960 68,541 22,847 91,388
Seaquist
Loffler Germany 27,500 15,143 0 15,143
Seaquist
Loffler Germany 6,706,201 343,436 3,349,408 3,692,843
Valois 400,000 32,838 32,838 65,675
Valois 34,151,367 887,748 4,719,496 5,607,245
Valois Italiana 400,786 22,248 200,669 222,917
Valois of
America 697,048 91,808 605,240 697,048
ROUNDING (1) (1)
--------------------------------------
TOTAL NOTES PAYABLE 6,686,652 78,552,836 85,239,487
--------------------------------------
</TABLE>
Schedule 5.15
<PAGE>
SCHEDULE 5.15
EXISTING INDEBTEDNESS
<TABLE>
<CAPTION>
Bank name Description Secured by Rate - fixed Interest Issue Maturity LC - ST
--------- of Debt Assets or Variable? Rate Date Date -------
------- ------ ----------- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C> <C>
MORTGAGES PAYABLE
General Plastics Credit Agricole Bank Yes F 5.90% 1/97 12/00 260,718
General Plastics Societe General Bank Yes V 4.65% 4/98 1/02 225,000
General Plastics Credit Agricole Bank Yes F 5.05% 8/98 7/02 153,886
General Plastics SNVB Bank Yes F 4.80% 8/98 7/02 199,094
General Plastics SNVB Bank Yes F 5.25% 8/98 7/02 188,740
General Plastics Bred Bank Yes F 4.80% 10/98 7/02 177,350
General Plastics BNP Bank Yes F 4.09% 3/99 9/03 91,066
General Plastics BNP Bank Yes F 4.09% 3/99 2/03 772,842
Novares S.p.A. Loan BNL Other No F 2.10% 12/22/98 6/30/08 269,260
Pfeiffer GmbH Commerzbank Bank Yes F 4.70% 06/96 3/99 0
Pfeiffer GmbH West LB Bank Yes F 5.00% 06/96 12/01 161,515
Pfeiffer GmbH Sparkasse Bank No F 4.95% 3/98 12/02 1,000,000
Pfeiffer GmbH BW Bank Bank No F 4.90% 11/97 12/02 1,000,000
Pfeiffer GmbH BW Bank Bank No F 5.00% 06/96 12/99 625,000
Sar Loan Other Yes F 5.25% 12/31/94 6/30/04 599,035
INDUSTRIAL REV BONDS
SPD US IRB IRB No V 6.05% 12/96 12/01 333,400
</TABLE>
<TABLE>
<CAPTION>
LC - LT TOTAL - LC US$ - ST US$ - LT TOTAL $
--------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
MORTGAGES PAYABLE
General Plastics 205,859 466,577 42,807 33,800 76,606
General Plastics 450,000 675,000 36,942 73,885 110,827
General Plastics 572,747 726,633 25,266 94,038 119,304
General Plastics 503,378 702,472 32,689 82,649 115,337
General Plastics 480,816 669,556 30,989 78,944 109,933
General Plastics 692,111 869,461 29,119 113,636 142,755
General Plastics 908,934 1,000,000 14,952 149,236 164,188
General Plastics 3,427,158 4,200,000 126,891 562,698 689,590
Novares S.p.A. 2,530,740 2,800,000 149,762 1,407,598 1,557,360
Pfeiffer GmbH 0 0 0 0 0
Pfeiffer GmbH 323,338 484,853 88,940 178,050 266,990
Pfeiffer GmbH 3,000,000 4,000,000 550,661 1,651,983 2,202,644
Pfeiffer GmbH 3,000,000 4,000,000 550,661 1,651,983 2,202,644
Pfeiffer GmbH 0 625,000 344,163 0 344,163
Sar 3,115,244 3,714,279 333,183 1,732,699 2,065,882
ROUNDING (1) (1)
-----------------------------------
TOTAL MORT PAYABLE 2,357,025 7,811,198 10,168,223
-----------------------------------
INDUSTRIAL REV BONDS
SPD US 582,450 915,850 333,400 582,450 915,850
-----------------------------------
</TABLE>
Schedule 5.15
<PAGE>
SCHEDULE 5.15
-------------
<TABLE>
<CAPTION>
EXISTING INDEBETEDNESS
Description Secured by Rate - fixed Interest Issue Maturity
Bank name of Debt Assets or Variable? Rate Date Date
--------- ----------- --------- ----------- ------- ----- -------
CAPITAL LEASES
<S> <C> <C> <C> <C> <C> <C> <C>
Dispray Capital Lease Building Yes F 2.50% 7/88 7/03
Dispray Capital Lease Building Yes F 6.62% 3/95 3/05
General Plastics Capital Lease Press Yes F 8.02% 3/15/95 3/15/00
General Plastics Capital Lease Press Yes F 8.32% 8/15/95 8/15/00
General Plastics Capital Lease Press Yes F 7.59% 4/1/96 11/26/00
Graphocolor Capital Lease Misc Equip No V 4.08% 12/30/96 12/30/08
MPN Capital Lease Sofinbail Yes F 7.49% 3/95 3/00
Pfeiffer-Valois UK Capital Lease Fork Lift Truc No F 12.43% 7/1/98 6/30/03
Rounding
Seaquist Loffler Czech Capital Lease Machine Yes F 7.00% 7/1/98 6/1/02
SVC Australia Capital Lease Volkswagon Yes F 7.24% 3/22/99 3/22/03
SVC Australia Capital Lease Subaru Yes F 6.99% 11/7/97 11/7/01
Valois Capital Lease Domibail Yes V 3.88% 6/30/90 6/30/05
Valois Capital Lease Domibail Yes V 3.85% 12/1/93 12/1/08
Valois Capital Lease Domibail Yes V 4.80% 1/10/90 7/4/05
</TABLE>
<TABLE>
<CAPTION>
LC - ST LC - LT TOTAL - LC US$ - ST US$ - LT TOTAL $
-------------------------------------------------------------------------
CAPITAL LEASES
<S> <C> <C> <C> <C> <C> <C>
Dispray 16,932 1,150,598 1,167,530 11,429 776,654 788,083
Dispray 16,418 1,190,101 1,206,519 11,082 803,318 814,400
General Plastics 372,964 0 372,964 61,236 0 61,236
General Plastics 99,557 48,564 148,121 16,346 7,974 24,320
General Plastics 101,831 79,678 181,509 16,719 13,082 29,802
Graphocolor 903,591 13,763,159 14,666,750 148,359 2,259,746 2,408,104
MPN 191,346 0 191,346 31,417 0 31,417
Pfeiffer-Valois UK 3,126 14,406 17,532 5,038 23,220 28,258
Rounding ROUNDING 2 2
Seaquist Loffler Czech 4,360,447 16,421,359 20,781,806 121,787 458,649 580,436
SVC Australia 6,226 42,608 48,834 3,949 27,026 30,975
SVC Australia 5,182 25,789 30,971 3,287 16,358 19,645
Valois 2,031,127 8,784,702 10,815,829 333,487 1,442,343 1,775,829
Valois 1,842,110 11,099,429 12,941,539 302,452 1,822,393 2,124,845
Valois 912,145 6,850,357 7,762,502 149,763 1,124,746 1,274,510
-----------------------------------
TOTAL CAPITAL LEASES 1,216,355 8,775,508 9,991,862
-----------------------------------
</TABLE>
Schedule 5.15
<PAGE>
SCHEDULE 5.15
-------------
<TABLE>
<CAPTION>
EXISTING INDEBTEDNESS
Description Secured by Rate--fixed Interest Issue Maturity
Bank name of Debt Assets or Variable? Rate Date Date
--------------- ----------- ---------- ----------- -------- -------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
</TABLE>
<TABLE>
<CAPTION>
LC - ST LC - LT TOTAL - LC US$ - ST US$ - LT TOTAL $
---------- ------- ----------- ---------- -------- -----------
<S> <C> <C> <C> <C> <C> <C>
GRAND TOTAL DEBT PER BOOKS 159,652,362 95,721,991 255,374,353
--------------------------
Add Guarantees:
DM based - 3/31/98
DM amt. FX rate $
Bechsteiner (former subsidiary) 3,600,000 0.550661 1,982,380
Bechsteiner (former subsidiary) 600,000 0.550661 330,397
Dollar based -
CoxxxxSeaquist LLC 3,750,000
-----------
TOTAL INDEBTEDNESS 261,437,130
===========
</TABLE>
Schedule 5.15
<PAGE>
SCHEDULE 10.3
-------------
EXISTING LIENS
See schedule 5.15 for debt secured by assets
Schedule 10.3
<PAGE>
EXHIBIT 1.1-A
-------------
[FORM OF NOTE]
APTARGROUP, INC.
[____]% SENIOR NOTE, SERIES [___], DUE [__________, ____]
No. [_____] [Date]
$ [_______] PPN[______________]
FOR VALUE RECEIVED, the undersigned, APTARGROUP, INC. (herein called
the "Company"), a corporation organized and existing under the laws of the State
of Delaware, promises to pay to [______________________], or registered assigns,
the principal sum of $[_________________________] on [ ],
-------------
[_________], with interest (computed on the basis of a 360-day year of twelve
30-day months) (a) on the unpaid balance thereof at the rate of [____]% per
annum from the date hereof, payable semiannually, on [______] [____] and
[______][____] in each year, commencing with the [______] [____] or [______]
[____] next succeeding the date hereof, until the principal hereof shall have
become due and payable, and (b) to the extent permitted by law on any overdue
payment (including any overdue prepayment) of principal, any overdue payment of
interest and any overdue payment of any Make-Whole Amount (as defined in the
Note Purchase Agreement referred to below), payable semiannually as aforesaid
(or, at the option of the registered holder hereof, on demand), at a rate per
annum from time to time equal to the greater of (i) [_____]% or (ii) 2% over the
rate of interest publicly announced by Bank of America from time to time in
Chicago, Illinois as its "base" or "prime" rate.
Payments of principal of, interest on and any Make-Whole Amount with
respect to this Note are to be made in lawful money of the United States of
America at the principal office of Bank of America in Chicago, Illinois or at
such other place as the Company shall have designated by written notice to the
holder of this Note as provided in the Note Purchase Agreement referred to
below.
This Note is one of a series of Senior Notes (herein called the
"Notes") issued pursuant to a Note Purchase Agreement dated as of May 15, 1999
[and a Supplement thereto dated as of [ ], [ ]](as from time to time
further amended and supplemented, the "Note Purchase Agreement"), between the
Company and the respective Purchasers named therein and is entitled to the
benefits thereof. Each holder of this Note will be deemed, by its acceptance
hereof, (i) to have agreed to the confidentiality provisions set forth in
Section 20 of the Note Purchase Agreement and (ii) to have made the
representation set forth in Section 6.2 of the Note Purchase Agreement.
This Note is a registered Note and, as provided in the Note Purchase
Agreement, upon surrender of this Note for registration of transfer, duly
endorsed, or accompanied by a written instrument of transfer duly executed, by
the registered holder hereof or such holder's
Exhibit 1.1-A
<PAGE>
attorney duly authorized in writing, a new Note for a like principal amount will
be issued to, and registered in the name of, the transferee. Prior to due
presentment for registration of transfer, the Company may treat the person in
whose name this Note is registered as the owner hereof for the purpose of
receiving payment and for all other purposes, and the Company will not be
affected by any notice to the contrary.
[The Company will make required prepayments of principal on the dates
and in the amounts specified in the Note Purchase Agreement.] This Note is
[also] subject to optional prepayment, in whole or from time to time in part, at
the times and on the terms specified in the Note Purchase Agreements but not
otherwise.
If an Event of Default, as defined in the Note Purchase Agreement,
occurs and is continuing, the principal of this Note may be declared or
otherwise become due and payable in the manner, at the price (including any
applicable Make-Whole Amount) and with the effect provided in the Note Purchase
Agreement.
This Note will be construed and enforced in accordance with, and the
rights of the parties shall be governed by, the law of the State of Illinois
excluding choice-of-law principles of the law of such State that would require
the application of the laws of a jurisdiction other than such State.
APTARGROUP, INC.
By: ________________________________
Title: _____________________________
2
Exhibit 1.1-A
<PAGE>
EXHIBIT 1.1-B
-------------
[FORM OF SUPPLEMENT]
SUPPLEMENT TO NOTE PURCHASE AGREEMENT
THIS SUPPLEMENT is entered into as of [ ], [ ] (this
"Supplement") between APTARGROUP, INC., a Delaware corporation (the "Company"),
and the Purchasers listed in the attached Schedule A (the "Purchasers").
R E C I T A L S
---------------
A. The Company has entered into a Note Purchase Agreement dated as of May
15, 1999 with the purchasers listed in Schedule A thereto [and one or more
supplements or amendments thereto] (as heretofore amended and supplemented, the
"Note Purchase Agreement"); and
B. The Company desires to issue and sell, and the Purchasers desire to
purchase, an additional series of Notes (as defined in the Note Purchase
Agreement) pursuant to the Note Purchase Agreement and in accordance with the
terms set forth below;
NOW, THEREFORE, the Company and the Purchasers agree as follows:
1. Authorization of the New Series of Notes. The Company has authorized
----------------------------------------
the issue and sale of $[ ] aggregate principal amount of Notes
to be designated as its [__]% Senior Notes, Series [ ], due [ ], [
] (the "Series [ ] Notes", such term to include any such Notes issued in
substitution therefor pursuant to Section 13 of the Note Purchase Agreement).
The Series [ ] Notes shall be substantially in the form set out in
Exhibit 1 to this Supplement, with such changes therefrom, if any, as may be
approved by you and the Company.
2. Sale and Purchase of Series [ ] Notes. Subject to the terms and
--------------------------------------
conditions of this Supplement and the Note Purchase Agreement, the Company will
issue and sell to each of the Purchasers, and the Purchasers will purchase from
the Company, at the Closing provided for in Section 3, Series [ ] Notes in
the principal amount specified opposite their respective names in the attached
Schedule A at the purchase price of 100% of the principal amount thereof. The
obligations of the Purchasers hereunder are several and not joint obligations
and no Purchaser shall have any liability to any Person for the performance or
non-performance by any other Purchaser hereunder.
3. Closing. The sale and purchase of the Series [ ] Notes to be
-------
purchased by the Purchasers shall occur at the offices of Gardner, Carton &
Douglas, Quaker Tower, Suite 3400,
Exhibit 1.1-B
<PAGE>
321 North Clark Street, Chicago, Illinois 60610 at 9:00 a.m., Chicago time, at a
closing (the "Closing") on [ ], [ ] or on such other Business Day
thereafter on or prior to [ ], [ ] as may be agreed upon by the Company and the
Purchasers. At the Closing the Company will deliver to each Purchaser the
Series [ ] Notes to be purchased by it in the form of a single Note (or
such greater number of Series [ ] Notes in denominations of at least $500,000
as such Purchaser may request) dated the date of the Closing and registered in
its name (or in the name of its nominee), against delivery by such Purchaser to
the Company or its order of immediately available funds in the amount of the
purchase price therefor by wire transfer of immediately available funds for the
account of the Company to account number [__________] at [_________________]
Bank, [Insert Bank address, ABA number for wire transfers, and any other
-----------------------------------------------------------------
relevant wire transfer information]. If at the Closing the Company shall fail to
- -----------------------------------
tender such Series [ ] Notes to a Purchaser as provided above in this Section
3, or any of the conditions specified in Section 4 of the Note Purchase
Agreement, as modified or expanded by Section 4 hereof, shall not have been
fulfilled to such Purchaser's satisfaction, such Purchaser shall, at its
election, be relieved of all further obligations under this Agreement, without
thereby waiving any rights it may have by reason of such failure or such
nonfulfillment.
4. Conditions to Closing. Each Purchasers obligation to purchase and pay
---------------------
for the Series [ ] Notes to be sold to it at the Closing is subject to the
fulfillment to its satisfaction, prior to or at the Closing, of the conditions
set forth in Section 4 of the Note Purchase Agreement, as hereafter modified,
and to the following additional conditions:
[Set forth any modifications and additional conditions.]
5. Representations and Warranties of the Company. The Company represents
---------------------------------------------
and warrants to the Purchasers that each of the representations and warranties
contained in Section 5 of the Note Purchase Agreement is true and correct as of
the date hereof (i) except that all references to "Purchaser" and "you" therein
shall be deemed to refer to the Purchasers hereunder, all references to "this
Agreement" shall be deemed to refer to the Note Purchase Agreement as
supplemented by this Supplement, and all references to "Notes" therein shall be
deemed to include the Series [ ] Notes, and (ii) except for changes to such
representations and warranties or the Schedules referred to therein, which
changes are set forth in the attached Schedule 5.
6. Representations of the Purchasers. Each Purchaser confirms to the
---------------------------------
Company that the representations set forth in Section 6 of the Note Purchase
Agreement are true and correct as to such Purchaser.
2
Exhibit 1.1-B
<PAGE>
7. Mandatory Prepayment of the Series [ ] Notes. [The Series [ ]
-----------------------------------------------
Notes are not subject to mandatory prepayment by the Company.] [On [ ],
[ ] and on each [ ] thereafter to and including [ ], [ ] the
Company will prepay $[ ] principal amount (or such lesser
principal amount as shall then be outstanding) of the Series [ ] Notes at par
and without payment of the Make-Whole Amount or any premium.]
8. Applicability of Note Purchase Agreement. Except as otherwise
----------------------------------------
expressly provided herein (and expressly permitted by the Note Purchase
Agreement), all of the provisions of the Note Purchase Agreement are
incorporated by reference herein and shall apply to the Series [ ] Notes as
if expressly set forth in this Supplement.
IN WITNESS WHEREOF, the Company and the Purchasers have caused this
Supplement to be executed and delivered as of the date set forth above.
APTARGROUP, INC.
By:________________________
Title:_____________________
[ADD PURCHASER SIGNATURE BLOCKS]
3
Exhibit 1.1-B
<PAGE>
Schedule A
to Supplement
-------------
INFORMATION RELATING TO PURCHASERS
Principal Amount of Series
Name and Address of Purchaser [ ] Notes to be Purchased
- ----------------------------- --------------------------
[NAME OF PURCHASER] $
(1) All payments by wire transfer
of immediately available
funds to:
with sufficient information
to identify the source and
application of such funds.
(2) All notices of payments and
written confirmations of such
wire transfers:
(3) All other communications:
4
Exhibit 1.1-B
<PAGE>
Schedule 5
to Supplement
-------------
EXCEPTIONS TO REPRESENTATIONS
AND WARRANTIES
5
Exhibit 1.1-B
<PAGE>
Exhibit 1 to
Supplement
----------
[FORM OF SERIES [ ] NOTE]
6
Exhibit 1.1-B
<PAGE>
EXHIBIT 1.2
-----------
[FORM OF SERIES 1999-A NOTE]
APTARGROUP, INC.
6.62% Senior Note, Series 1999-A
due May 30, 2011
No. [_____] [Date]
$[________] $PPN[______________]
FOR VALUE RECEIVED, the undersigned, APTARGROUP, INC. (herein called
the "Company"), a corporation organized and existing under the laws of the State
of Delaware, promises to pay to [______________________], or registered assigns,
the principal sum of $[ ] on May 30, 2011, with interest (computed on
the basis of a 360-day year of twelve 30-day months) (a) on the unpaid balance
thereof at the rate of 6.62% per annum from the date hereof, payable
semiannually, on May 30 and November 30 in each year, commencing with November
30, 1999, until the principal hereof shall have become due and payable, and (b)
to the extent permitted by law on any overdue payment (including any overdue
prepayment) of principal, any overdue payment of interest and any overdue
payment of any Make-Whole Amount (as defined in the Note Purchase Agreement
referred to below), payable semiannually as aforesaid (or, at the option of the
registered holder hereof, on demand), at a rate per annum from time to time
equal to the greater of (i) 8.62% or (ii) 2% over the rate of interest publicly
announced by Bank of America from time to time in Chicago, Illinois as its
"base" or "prime" rate.
Payments of principal of, interest on and any Make-Whole Amount with
respect to this Note are to be made in lawful money of the United States of
America at the principal office of Bank of America in Chicago, Illinois or at
such other place as the Company shall have designated by written notice to the
holder of this Note as provided in the Note Purchase Agreement referred to
below.
This Note is one of a series of Notes (herein called the "Notes")
issued pursuant to a Note Purchase Agreement, dated as of May 15, 1999 as from
time to time amended and supplemented, the "Note Purchase Agreement"), between
the Company and the respective Purchasers named therein and is entitled to the
benefits thereof. Each holder of this Note will be deemed, by its acceptance
hereof, (i) to have agreed to the confidentiality provisions set forth in
Section 20 of the Note Purchase Agreement and (ii) to have made the
representation set forth in Section 6.2 of the Note Purchase Agreement.
This Note is a registered Note and, as provided in the Note Purchase
Agreement, upon surrender of this Note for registration of transfer, duly
endorsed, or accompanied by a written instrument of transfer duly executed, by
the registered holder hereof or such holder's
Exhibit 1.2(a)
<PAGE>
attorney duly authorized in writing, a new Note for a like principal amount will
be issued to, and registered in the name of, the transferee. Prior to due
presentment for registration of transfer, the Company may treat the person in
whose name this Note is registered as the owner hereof for the purpose of
receiving payment and for all other purposes, and the Company will not be
affected by any notice to the contrary.
The Company will make required prepayments of principal on the dates
and in the amounts specified in the Note Purchase Agreement. This Note is also
subject to optional prepayment, in whole or from time to time in part, at the
times and on the terms specified in the Note Purchase Agreement but not
otherwise.
If an Event of Default, as defined in the Note Purchase Agreement,
occurs and is continuing, the principal of this Note may be declared or
otherwise become due and payable in the manner, at the price (including any
applicable Make-Whole Amount) and with the effect provided in the Note Purchase
Agreement.
This Note will be construed and enforced in accordance with, and the
rights of the parties shall be governed by, the law of the State of Illinois
excluding choice-of-law principles of the law of such State that would require
the application of the laws of a jurisdiction other than such State.
APTARGROUP, INC.
By:_______________________
Title:____________________
2
Exhibit 1.2(a)
<PAGE>
EXHIBIT 4.4(a)
FORM OF OPINION OF COUNSEL
TO THE COMPANY
The opinion of Sidley & Austin, counsel to the Company, shall be to the
effect that:
1. The Company is duly incorporated, validly existing and in good
standing under the laws of the State of Delaware, has the corporate power and
the corporate authority to execute and perform the Note Purchase Agreement and
to issue the Series 1999-A Notes and has the corporate power and the corporate
authority to own and operate its properties and to carry on its business as
described in the Company's Annual Report on Form 10-K for the year ended
December 31, 1998.
2. The Company is duly qualified and in good standing as a foreign
corporation in the States of California, Illinois, Indiana, Michigan, Minnesota,
New Jersey, North Carolina, Ohio and Wisconsin.
3. The Note Purchase Agreement and the Series 1999-A Notes have been duly
authorized by all necessary corporate action on the part of the Company, have
been duly executed and delivered by the Company and constitute the legal, valid
and binding obligations of the Company, enforceable against the Company in
accordance with their respective terms, except to the extent enforceability may
be limited by applicable bankruptcy, insolvency, reorganization, moratorium,
fraudulent transfer or other similar laws affecting the enforcement of
creditors' rights generally and by the effect of general principles of equity
(regardless of whether enforcement is sought in a proceeding in equity or at
law).
4. The issuance, sale and delivery of the Series 1999-A Notes under the
circumstances contemplated by the Note Purchase Agreement do not, under existing
law, require the registration of the Series 1999-A Notes under the Securities
Act of 1933, as amended, or the qualification of an indenture in respect of the
Notes under the Trust Indenture Act of 1939, as amended.
5. No approval, consent or withholding of objection on the part of, or
filing, registration or qualification with, any Governmental Authority is
necessary or required in connection with the execution, delivery and performance
by the Company of the Note Purchase Agreement or the issuance and sale by the
Company of the Series 1999-A Notes.
6. The issuance and sale of the Series 1999-A Notes by the Company and
the execution, delivery and performance by the Company of the Note Purchase
Agreement do not violate the Amended and Restated Certificate of Incorporation
or By-Laws of the Company, do not result in any breach of any provisions of,
constitute a default under or result in the creation or imposition of any Lien
on any property of the Company pursuant to any agreement or other instrument
known to such counsel that is applicable to the Company and do not violate any
law or regulation or any order, writ, injunction or decree known to such counsel
of any court or Governmental Authority applicable to the Company.
Exhibit 4.4(a)
<PAGE>
7. The Company is not (i) a "public utility company" or a "holding
company," or an "affiliate" or a "subsidiary company" of a "holding company," or
an "affiliate" of such a "subsidiary company," as such terms are defined in the
Public Utility Holding Company Act of 1935, as amended, (ii) a "public utility"
as defined in the Federal Power Act, as amended, or (iii) an "investment
company" or an "affiliated person" thereof, as such terms are defined in the
Investment Company Act of 1940, as amended.
8. The use of the proceeds of the sale of the Series 1999-A Notes in
accordance with the terms of the Note Purchase Agreement do not violate or
conflict with Regulation T, U or X of the Board of Governors of the Federal
Reserve System.
The opinion of Sidley & Austin shall cover such other matters relating to the
sale of the Series 1999-A Notes as the Purchasers may reasonably request. With
respect to matters of fact on which such opinion is based, such counsel shall be
entitled to rely on appropriate certificates of public officials and officers of
the Company and with respect to matters governed by the laws of any jurisdiction
other than the United States of America, the Delaware General Corporation Law
and the laws of the State of Illinois, such counsel may rely upon the opinions
of counsel deemed (and stated in their opinion to be deemed) by it to be
competent and reliable.
2
Exhibit 4.4(a)
<PAGE>
EXHIBIT 4.4(b)
FORM OF OPINION OF SPECIAL COUNSEL
TO THE PURCHASERS
The opinion of Gardner, Carton & Douglas, special counsel to the
Purchasers, shall be to the effect that:
1. The Company is a corporation organized and validly existing in good
standing under the laws of the State of Delaware, with all requisite corporate
power and authority to enter into the Agreement and to issue and sell the Series
1999-A Notes.
2. The Agreement and the Series 1999-A Notes have been duly authorized by
proper corporate action on the part of the Company, have been duly executed and
delivered by an authorized officer of the Company, and constitute the legal,
valid and binding agreements of the Company, enforceable in accordance with
their terms, except to the extent that enforcement thereof may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium or similar laws of
general application relating to or affecting the enforcement of the rights of
creditors or by equitable principles, regardless of whether enforcement is
sought in a proceeding in equity or at law.
3. Based upon the representations set forth in the Agreement, the
offering, sale and delivery of the Series 1999-A Notes do not require the
registration of the Series 1999-A Notes under the Securities Act of 1933, as
amended, nor the qualification of an indenture under the Trust Indenture Act of
1939, as amended.
4. The issuance and sale of the Series 1999-A Notes and compliance with
the terms and provisions of the Series 1999-A Notes and the Agreement will not
conflict with or result in any breach of any of the provisions of the
Certificate of Incorporation or By-Laws of the Company.
5. No approval, consent or withholding of objection on the part of, or
filing, registration or qualification with, any governmental body, Federal or
state, is necessary in connection with the execution and delivery of the
Agreement or the Series 1999-A Notes.
The opinion of Gardner, Carton & Douglas also shall state that the opinion of
Sidley & Austin, delivered to you pursuant to the Agreement, is satisfactory in
form and scope to Gardner, Carton & Douglas, and, in its opinion, the Purchasers
are justified in relying thereon and shall cover such other matters relating to
the sale of the Series 1999-A Notes as the Purchasers may reasonably request.
<PAGE>
================================================================================
Exhibit 4.2
MULTICURRENCY CREDIT AGREEMENT
Dated as of
June 30, 1999
Among
APTARGROUP, INC.,
THE LENDERS PARTY HERETO,
BANK OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION,
as Agent
and
BANC OF AMERICA SECURITIES LLC,
as Arranger
================================================================================
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
<S> <C>
SECTION 1. DEFINITIONS; INTERPRETATION................................... 1
Section 1.1. Definitions..................................... 1
Section 1.2. Interpretation.................................. 10
Section 1.3. Euro Provisions................................. 10
SECTION 2. THE CREDIT FACILITIES......................................... 11
Section 2.1. Ratable Borrowings under the Revolving Credit... 11
Section 2.2. Types of Loans and Minimum Borrowing Amounts.... 11
Section 2.3. Manner of Borrowing............................. 12
Section 2.4. Interest Periods................................ 14
Section 2.5. Maturity of Loans............................... 14
Section 2.6. Applicable Interest Rates....................... 14
Section 2.7. Optional Prepayments............................ 18
Section 2.8. Mandatory Prepayments of Loans.................. 18
Section 2.9. Default Rate.................................... 18
Section 2.10. Loan Accounts................................... 19
Section 2.11. Funding Indemnity............................... 19
Section 2.12. Commitment Reductions........................... 19
SECTION 3. FEES AND PAYMENTS............................................. 20
Section 3.1. Fees............................................ 20
Section 3.2. Place and Application of Payments............... 20
Section 3.3. Withholding Taxes............................... 21
SECTION 4. CONDITIONS PRECEDENT.......................................... 22
Section 4.1. Agreement Effectiveness......................... 22
Section 4.2. All Credit Events............................... 23
SECTION 5. REPRESENTATIONS AND WARRANTIES................................ 23
Section 5.1. Organization.................................... 23
Section 5.2. Corporate Power and Authority................... 23
Section 5.3. No Violation.................................... 24
Section 5.4. Governmental Authorization...................... 24
Section 5.5. Litigation...................................... 24
Section 5.6. Use of Proceeds; Margin Regulations............. 24
Section 5.7. Investment Company Act.......................... 25
Section 5.8. Public Utility Holding Company Act.............. 25
Section 5.9. True and Complete Disclosure.................... 25
</TABLE>
i
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<TABLE>
<S> <C>
Section 5.10. Financial Statements................................................ 25
Section 5.11. No Material Adverse Change.......................................... 25
Section 5.12. Labor Controversies................................................. 25
Section 5.13. Taxes............................................................... 25
Section 5.14. ERISA............................................................... 26
Section 5.15. Intellectual Property............................................... 26
Section 5.16. Compliance with Statutes, Etc....................................... 26
Section 5.17. Environmental Matters............................................... 26
Section 5.18. Existing Debt....................................................... 27
Section 5.19. No Burdensome Restrictions; Compliance with Agreements.............. 27
Section 5.20. Year 2000 Problem................................................... 27
SECTION 6. COVENANTS.......................................................................... 27
Section 6.1. Existence............................................................ 27
Section 6.2. Maintenance.......................................................... 27
Section 6.3. Taxes................................................................ 28
Section 6.4. ERISA................................................................ 28
Section 6.5. Insurance............................................................ 28
Section 6.6. Financial Reports and Other Information.............................. 28
Section 6.7. Lender Inspection Rights............................................. 30
Section 6.8. Conduct of Business.................................................. 31
Section 6.9. Fiscal Years and Quarters............................................ 31
Section 6.10. Limitation on Certain Restrictions on Subsidiaries................... 31
Section 6.11. Mergers, Consolidations and Asset Sales.............................. 31
Section 6.12. Use of Property and Facilities; Environmental,
Health and Safety Laws........................................... 32
Section 6.13. Liens................................................................ 32
Section 6.14. Debt................................................................. 33
Section 6.15. Advances, Acquisitions, Investments and Loans........................ 33
Section 6.16. Dividends and Other Shareholder Distributions........................ 35
Section 6.17. Leverage............................................................. 35
Section 6.18. Interest Coverage Ratio.............................................. 35
Section 6.19. Transactions with Affiliates......................................... 35
Section 6.20. Compliance with Laws................................................. 35
Section 6.21. Take or Pay Contracts................................................ 35
Section 6.22. Inconsistent Agreements.............................................. 36
SECTION 7. EVENTS OF DEFAULT AND REMEDIES..................................................... 36
Section 7.1. Events of Default.................................................... 36
Section 7.2. Non-Bankruptcy Defaults.............................................. 38
Section 7.3. Bankruptcy Defaults.................................................. 38
Section 7.4. Notice of Default.................................................... 38
Section 7.5. Expenses............................................................. 38
SECTION 8. CHANGE IN CIRCUMSTANCES............................................................ 38
Section 8.1. Change of Law........................................................ 38
Section 8.2. Unavailability of Deposits or Inability to Ascertain LIBOR........... 39
</TABLE>
ii
<PAGE>
<TABLE>
<S> <C>
Section 8.3. Increased Cost and Reduced Return............. 39
Section 8.4. Lending Offices............................... 40
Section 8.5. Discretion of Lender as to Manner of Funding.. 40
Section 8.6. Substitution of Lender........................ 41
SECTION 9. THE AGENT................................................... 41
Section 9.1. Appointment and Authorization................. 41
Section 9.2. Delegation of Duties.......................... 41
Section 9.3. Liability of Agents........................... 41
Section 9.4. Reliance by Agent............................. 42
Section 9.5. Notice of Default............................. 42
Section 9.6. Credit Decision............................... 42
Section 9.7. Indemnification............................... 43
Section 9.8. Agent in Individual Capacity.................. 43
Section 9.9. Successor Agent............................... 44
SECTION 10. MISCELLANEOUS............................................... 44
Section 10.1. No Waiver of Rights.......................... 44
Section 10.2. Non-Business Day............................. 44
Section 10.3. Documentary Taxes............................ 44
Section 10.4. Survival of Representations.................. 44
Section 10.5. Survival of Indemnities...................... 45
Section 10.6. Sharing of Set-off........................... 45
Section 10.7. Notices...................................... 45
Section 10.8. Counterparts................................. 46
Section 10.9. Successors and Assigns....................... 46
Section 10.10. Participants................................. 46
Section 10.11. Assignments of Commitments by Lenders........ 46
Section 10.12. Amendments................................... 47
Section 10.13. Headings..................................... 47
Section 10.14. Legal Fees, Other Costs and Indemnification.. 47
Section 10.15. Set Off...................................... 48
Section 10.16. Entire Agreement............................. 48
Section 10.17. Governing Law; Submission to Jurisdiction;
Waiver of Jury Trial.................... 48
Section 10.18. Confidentiality.............................. 49
Section 10.19. Severability................................. 49
Section 10.20. Currency..................................... 49
Section 10.21. Currency Equivalence......................... 50
</TABLE>
iii
<PAGE>
EXHIBITS
- --------
Exhibit A -- Form of Notice of Borrowing
Exhibit B -- Form of Notice of Conversion/Continuation
Exhibit C -- Form of Compliance Certificate
Exhibit D -- Form of Assignment Agreement
SCHEDULES
- ---------
Schedule 1 Notice of Assignment and Acceptance
Schedule 2.1 Commitments
Schedule 5.1 Subsidiaries
Schedule 5.18 Debt
Schedule 6.15 Existing Loans, Advances and Investments
Schedule 10.2 Lending Offices, Address for Notices
iv
<PAGE>
MULTICURRENCY CREDIT AGREEMENT, dated as of June 30, 1999, among
AptarGroup, Inc., a Delaware corporation (the "Borrower"), the lenders from time
to time party hereto (each a "Lender" and, collectively, the "Lenders") and Bank
of America National Trust and Savings Association, as Agent. Capitalized terms
used herein are defined in Section 1.
SECTION 1. DEFINITIONS; INTERPRETATION.
Section 1.1. Definitions. The following terms when used herein have the
-----------
following meanings:
"Affiliate" means, for any Person, any other Person (including all
directors and officers of such Person) that directly or indirectly controls, or
is under common control with, or is controlled by, such Person. As used in this
definition, "control" means the power, directly or indirectly, to direct or
cause the direction of management or policies of a Person (through ownership of
voting securities, by contract or otherwise), provided that, in any event for
purposes of the definition any Person that owns directly or indirectly 10% or
more of the securities having ordinary voting power for the election of
directors of a corporation or 10% or more of the partnership or other ownership
interests of any other Person (other than as a limited partner of such other
Person) will be deemed to control such corporation or other Person.
"Agent" means BofA acting in its capacity as agent for the Lenders and any
successor pursuant to Section 9.9.
"Agent-Related Persons" means BofA in its capacity as Agent and any
successor Agent arising under Section 9.9, together with their respective
Affiliates (including, in the case of BofA, the Arranger), and the officers,
directors, employees, agents and attorneys-in-fact of such Persons and
Affiliates.
"Applicable Eurocurrency Margin" is defined in Section 2.6(b).
"Arranger" means Banc of America Securities LLC.
"Asset Sale" means any sale, transfer or other disposition by the Borrower
or any of its Subsidiaries to any Person other than the Borrower or any Wholly-
Owned Subsidiary of the Borrower of any asset (including, without limitation,
any capital stock or other securities of another Person) of the Borrower or such
Subsidiary other than (i) sales, transfers or other dispositions of inventory in
the ordinary course of business, (ii) sales of equipment and other fixed assets
no longer used or useful in the business of the Borrower or any of its
Subsidiaries, as determined by the Borrower or such Subsidiary in its reasonable
judgment, (iii) sales of equipment and other fixed assets if the proceeds
thereof are used to purchase additional equipment or fixed assets and (iv) cash.
"Assignment Agreement" means an agreement in substantially the form of
Exhibit D whereby a Lender conveys part or all of its Commitments and Loans to
another Person that
<PAGE>
thereupon becomes a Lender, or that increases its Commitments or outstanding
Loans, or both, pursuant to Section 10.11.
"Base Rate" is defined in Section 2.6(a).
"Base Rate Loan" means a Loan denominated in U.S. Dollars bearing interest
prior to maturity at the rate specified in Section 2.6(a).
"BofA" means Bank of America National Trust and Savings Association, a
national banking association.
"Borrower" is defined in the preamble.
"Borrowing" means the total of Loans of a single type advanced, continued
for an additional Interest Period, or converted from a different type into such
type by Lenders on a single date and, in the case of Eurocurrency Loans, in a
single currency and for a single Interest Period. Borrowings of Loans are made
and maintained ratably from each of the Lenders according to their Percentages.
A Borrowing is "advanced" on the day Lenders advance funds comprising such
Borrowing to the Borrower, is "continued" (in the case of Eurocurrency Loans) on
the date a new Interest Period commences for such Borrowing, and is "converted"
when such Borrowing is changed from one type of Loan to the other, all as
requested by the Borrower pursuant to Section 2.3(a).
"Business Day" means any day other than a Saturday or Sunday on which banks
are not authorized or required to close in Chicago, Illinois, San Francisco,
California or New York, New York and, if the applicable Business Day relates to
the borrowing or payment of a Eurocurrency Loan, on which banks are dealing in
U.S. Dollar deposits in the interbank market in London, England, and, if the
applicable Business Day relates to the borrowing or payment of a Eurocurrency
Loan denominated in an Optional Currency, on which banks and foreign exchange
markets are open for business in both London and in the city where disbursements
of or payments on such Loans are to be made (and, if such Optional Currency is
Euros, a day on which (x) the Trans-European Automated Real-time Gross
Settlement Express Transfer System (or any successor settlement system) is open
and (y) the banks and foreign exchange markets are open in such financial center
as is determined by the Agent to be suitable for clearing or settlement of
Euros).
"Cash Equivalents" means (i) securities issued or directly and fully
guaranteed or insured by the United States of America or any agency or
instrumentality thereof having maturities of not more than six months from the
date of acquisition, (ii) domestic and Eurodollar denominated time deposits,
certificates of deposit and bankers acceptances of any Lender or any bank whose
short-term debt rating from Standard & Poor's Ratings Service ("S&P") is at
least A-1 or the equivalent or from Moody's Investors Service, Inc. ("Moody's")
is at least P-1 or the equivalent with maturities of not more than six months
from the date of acquisition, (iii) commercial paper with a rating of at least
A-1 or the equivalent by S&P or at least P-1 or the equivalent by
2
<PAGE>
Moody's maturing within six months after the date of acquisition, (iv)
marketable direct obligations issued by any state of the United States of
America or any political subdivision of any such state or any public
instrumentality thereof maturing within six months from the date of acquisition
thereof and, at the time of acquisition, having one of the two highest ratings
obtainable from either S&P or Moody's, (v) investments in money market funds
substantially all the assets of which are comprised of securities of the types
described in clauses (i) through (iv) above, and (vi) other similar high quality
instruments of equivalent United States rating in countries where Subsidiaries
organized under laws of jurisdictions outside of the United States are located.
A "Change of Control Event" shall be deemed to have occurred if (a) any
Person or group of Persons (within the meaning of Section 13 or 14 of the
Securities Exchange Act of 1934) shall have acquired beneficial ownership
(within the meaning of Rule 13(d)-3 of the Securities Exchange Act of 1934, as
amended, and the applicable rules and regulations thereunder) of more than 50%
of the outstanding Voting Stock of the Borrower, or (b) during any period of 12
consecutive months, commencing before or after the date of this Agreement,
individuals who on the first day of such period were directors of the Borrower
(together with any replacement or additional directors who were nominated or
elected by a majority of directors then in office) cease to constitute a
majority of the Board of Directors of the Borrower.
"Code" means the Internal Revenue Code of 1986, as amended.
"Commitments" is defined in Section 2.1.
"Compliance Certificate" means a certificate in the form of Exhibit C.
"Consolidated Debt" means all Debt of the Borrower determined on a
consolidated basis.
"Consolidated EBIT" means, for any period, Consolidated Net Income before
Consolidated Interest Expense and provisions for taxes based on income and
without giving effect to any extraordinary gains or losses.
"Consolidated EBITDA" means, for any period, Consolidated EBIT plus the
amount of all depreciation and amortization expense deducted in determining
Consolidated EBIT for such period.
"Consolidated Interest Expense" means, for any period, total interest
expense of the Borrower determined on a consolidated basis in connection with
Debt.
"Consolidated Interest Ratio" means, for any period, the ratio of
Consolidated EBITDA to Consolidated Interest Expense for such period.
"Consolidated Leverage Ratio" means, as of any time the same is to be
determined, the ratio of (x) Consolidated Debt to (y) Total Capitalization.
3
<PAGE>
"Consolidated Net Income" means, for any period, the net income (or loss),
after provision for taxes, of the Borrower on a consolidated basis for such
period taken as a single accounting period, after eliminating therefrom all
extraordinary non-cash items of income.
"Consolidated Net Worth" means the aggregate amount of the Borrower's
shareholders' equity determined from its consolidated balance sheet.
"Contractual Obligations" means, for any Person, any provision of any
security issued by such Person or of any agreement, instrument or undertaking to
which such Person is a party or by which it or any of its Property is bound.
"Controlled Group" means all members of a controlled group of corporations
and all trades and businesses (whether or not incorporated) under common control
that, together with the Borrower or any of its Subsidiaries, are treated as a
single employer under Section 414 of the Code.
"Credit Documents" means this Agreement and any other agreements between
any Lender and the Borrower executed in connection with this Agreement.
"Credit Event" means the advance, conversion or continuation of any Loan
(including by failing to give notice of non-renewal).
"Debt" means all items described in clauses (i) through (vii) of the
definition of Indebtedness.
"Default" means any event or condition the occurrence of which would, with
the passage of time or the giving of notice, or both, constitute an Event of
Default.
"Effective Date" is defined in Section 4.1.
"Eligible Assignee" means a commercial bank incorporated or organized under
the laws of the United States of America, any state or political subdivision
thereof or another member country of the Organization for Economic Cooperation
and Development with a net worth or combined capital and surplus of not less
than $500,000,000.
"EMU" means economic and monetary union as contemplated in the Treaty on
European Union.
"EMU Legislation" means legislative measures of the European Council for
the introduction of, changeover to or operation of a single or unified European
currency (whether known as the euro or otherwise), being in part the
implementation of the third state of EMU.
"Environmental Claims" means any and all administrative, regulatory or
judicial actions, suits, demands, demand letters, claims, liens, notices of non-
compliance or violation,
4
<PAGE>
investigations or proceedings relating in any way to any Environmental Law
("Claims") or any permit issued under any Environmental Law, including, without
limitation, (a) any and all Claims by a Governmental Authority for enforcement,
cleanup, removal, response, remedial or other actions or damages pursuant to any
applicable Environmental Law, and (b) any and all Claims by any third party
seeking damages, contribution, indemnification, cost recovery, compensation or
injunctive relief resulting from Hazardous Materials or arising from alleged
injury or threat of injury to health, safety or the environment.
"Environmental Law" means any United States federal, state or local
statute, law, rule, regulation, ordinance, code, policy having the force of law
or rule of common law now or hereafter in effect and any judicial or
administrative interpretation thereof, including any judicial or administrative
order, consent, decree or judgment, in each case relating to the environment,
health, safety or Hazardous Materials.
"ERISA" is defined in Section 5.13.
"Euro" means the single currency of Participating Member States of the
European Union.
"Eurocurrency Loan" means a Loan denominated in U.S. Dollars or an Optional
Currency and bearing interest before maturity at the rate specified in Section
2.6(b).
"Eurocurrency Reserve Percentage" is defined in Section 2.6(b).
"Euro Unit" means a currency unit of the Euro.
"Event of Default" means any of the events or circumstances specified in
Section 7.1.
"Existing Credit Agreements" means (i) the Credit Agreement dated as of
August 26, 1994, as amended to the date hereof, among the Borrower, the Lenders
party thereto and ABN AMRO Bank N.V., as Agent and (ii) the Credit Agreement
dated as of February 12, 1999 between the Borrower and Bank of America National
Trust and Savings Association.
"Federal Funds Rate" means the fluctuating interest rate per annum
described in part (x) of clause (ii) of the definition of Base Rate in Section
2.6(a).
"GAAP" means generally accepted accounting principles from time to time in
effect, applied in a manner consistent with those used in the preparation of the
audited financial statements for the Borrower's fiscal year ending December 31,
1998 referred to in Section 5.10.
"Governmental Authority" means any nation or government, any state or other
political subdivision thereof, any central bank (or similar monetary or
regulatory authority) thereof, any entity exercising executive, legislative,
judicial, regulatory or administrative functions of or pertaining to government,
and any corporation or other entity owned or controlled, through stock or
capital ownership or otherwise, by any of the foregoing.
5
<PAGE>
"Guaranty" by any Person means all obligations (other than endorsements in
the ordinary course of business of negotiable instruments for deposit or
collection) of such Person guaranteeing or in effect guaranteeing any
Indebtedness, dividend or other obligation (including, without limitation,
limited or full recourse obligations in connection with sales of receivables or
any other Property) of any other Person (the "primary obligor") in any manner,
whether directly or indirectly, including, without limitation, all obligations
incurred through an agreement, contingent or otherwise, by such Person: (i) to
purchase such Indebtedness or obligation or any Property or assets constituting
security therefor, (ii) to advance or supply funds (x) for the purchase or
payment of such Indebtedness or obligation, or (y) to maintain working capital
or other balance sheet condition, or otherwise to advance or make available
funds for the purchase or payment of such Indebtedness or obligation, or (iii)
to lease Property or to purchase Securities or other Property or services
primarily for the purpose of assuring the owner of such Indebtedness or
obligation of the ability of the primary obligor to make payment of the
Indebtedness or obligation, or (iv) otherwise to assure the owner of the
Indebtedness or obligation of the primary obligor against loss in respect
thereof. For the purpose of all computations made under this Agreement, the
amount of a Guaranty in respect of any obligation shall be deemed to be equal to
the maximum aggregate amount of such obligation or, if the Guaranty is limited
to less than the full amount of such obligation, the maximum aggregate potential
liability under the terms of the Guaranty.
"Hazardous Material" means (a) any asbestos, PCBs or dioxins or insulation
or other material composed of or containing asbestos, PCBs or dioxins and (b)
any petroleum product and any chemical, material or other substance defined as
"hazardous" or "toxic" or words with similar meaning and effect under any
Environmental Law.
"Indebtedness" means, for any Person, all obligations of such Person,
without duplication, required by GAAP to be shown as liabilities on its balance
sheet, and in any event shall include all (i) obligations of such Person for
borrowed money, (ii) obligations of such Person representing the deferred
purchase price of property or services other than accounts payable and accrued
expenses arising in the ordinary course of business on terms customary in the
trade, (iii) obligations of such Person evidenced by notes, acceptances, or
other instruments of such Person or arising out of letters of credit issued for
such Person's account, (iv) obligations, whether or not assumed, secured by
Liens or payable out of the proceeds or production from Property now or
hereafter owned or acquired by such Person, (v) capitalized lease obligations of
such Person, (vi) all Indebtedness (as defined above) of any partnership in
which such Person is a general partner, (vii) the outstanding principal amount
then owed to investors in connection with the sale of the Borrower's or any of
its Subsidiaries' accounts receivable, (viii) obligations of such Person in
respect of Synthetic Leases and (ix) obligations for which such Person is
obligated pursuant to a Guaranty.
"Indemnified Person" is defined in Section 10.14.
6
<PAGE>
"Interest Payment Date" means (a) for a Base Rate Loan, each March 31, June
30, September 30 and December 31 and the Termination Date, (b) for a
Eurocurrency Loan with an Interest Period of 3 months or less, the last day of
such Interest Period and the Termination Date, and (c) for a Eurocurrency Loan
with an Interest Period of 6 months, the date that is 3 months from the first
day of such Interest Period and the last day of such Interest Period and the
Termination Date.
"Interest Period" is defined in Section 2.4.
"Lender" is defined in the first sentence of this Agreement.
"Lending Office" is defined in Section 8.4.
"LIBOR" is defined in Section 2.6(b).
"Lien" means any interest in any Property or asset securing an obligation
owed to, or a claim by, a Person other than the owner of the Property or asset,
whether such interest is based on the common law, statute or contract,
including, but not limited to, the security interest lien arising from a
mortgage, encumbrance, pledge, conditional sale, security agreement or trust
receipt, or a lease, consignment or bailment for security purposes.
"Loan" means a Base Rate Loan or Eurocurrency Loan, each of which is a
"type" of Loan hereunder.
"Margin Testing Time" is defined in Section 2.6(b).
"Material Adverse Effect" means a material adverse effect on the business,
properties, assets, liabilities, condition (financial or otherwise) or prospects
of (i) the Borrower or (ii) the Borrower and its Subsidiaries taken as a whole.
"National Currency Unit" means a unit of currency (other than a Euro Unit)
of a Participating Member State.
"Notice of Borrowing" means a notice in substantially the form of Exhibit
A.
"Notice of Conversion/Continuation" means a notice in substantially the
form of Exhibit B.
"Obligations" means all fees payable hereunder, all obligations of the
Borrower to pay principal or interest on Loans and all other payment obligations
of the Borrower to the Agent or any Lender arising under or in relation to any
Credit Document.
"Optional Currency" means Pounds Sterling, Deutsche Mark, Australian
Dollars, French Francs, Italian Lira and Euros and any other currency requested
by the Borrower and acceptable
7
<PAGE>
to the Agent and all Lenders provided such requested currency is freely
available in the international bank market, freely transferable and freely
convertible into U.S. Dollars and readily utilized for the settlement of private
international debt transactions.
"Participating Member State" means each such state so described in any EMU
Legislation.
"Payment Office" means (a) in respect of payments in Dollars, the address
for payments set forth on Schedule 10.7 or such other address as the Agent may
from time to time specify in accordance with Section 10.7 and, (b) in the case
of payments in any Optional Currency, such address as the Agent may from time to
time specify in accordance with Section 10.7.
"PBGC" is defined in Section 5.14.
"Percentage" means, for each Lender, the percentage of the Commitments
represented by such Lender's Commitment; provided that, if the Commitments are
terminated, each Lender's Percentage will be calculated based on the percentage
which such Lender's then outstanding principal amount of Loans is of the
aggregate outstanding principal amount of Loans of all Lenders.
"Permitted Liens" is defined in Section 6.13.
"Person" means an individual, partnership, corporation, limited liability
company, association, trust, unincorporated organization or any other entity or
organization, including a government or any agency or political subdivision
thereof.
"Plan" means an employee pension benefit plan covered by Title IV of ERISA
or subject to the minimum funding standards under Section 412 of the Code and is
either (i) maintained by a member of the Controlled Group for employees of a
member of the Controlled Group of which the Borrower or any of its Subsidiaries
is a member or (ii) maintained pursuant to a collective bargaining agreement or
any other arrangement under which more than one employer makes contributions and
to which a member of the Controlled Group of which the Borrower or any of its
Subsidiaries is a member is then making or accruing an obligation to make
contributions or has within the preceding five plan years made or had an
obligation to make contributions.
"Property" means any interest in any kind of property or asset, whether
real, personal or mixed, or tangible or intangible, whether now owned or
hereafter acquired.
"Required Lenders" means, at any time, Lenders then holding in aggregate
more than 50% of the Percentages.
"Same Day Funds" means (a) with respect to disbursements and payments in
U.S. Dollars, immediately available funds, and (b) with respect to disbursements
and payments in an Optional Currency, same day or other funds as may be
determined by the Agent to be customary
8
<PAGE>
in the place of disbursement or payment for the settlement of international
banking transactions in the Relevant Optional Currency.
"SEC" means the Securities and Exchange Commission.
"Security" has the same meaning as in Section 2(l) of the Securities Act of
1933, as amended.
"Set-Off" is defined in Section 10.6.
"Subsidiary" means, for the Borrower, any corporation or other entity of
which more than fifty percent (50%) of the outstanding stock or comparable
equity interests having ordinary voting power for the election of the Board of
Directors of such corporation or similar governing body in the case of a non-
corporation (irrespective of whether or not, at the time, stock or other equity
interests of any other class or classes of such corporation or other entity
shall have or might have voting power by reason of the happening of any
contingency) is at the time directly or indirectly owned by the Borrower or by
one or more of its Subsidiaries.
"Synthetic Lease" means a lease transaction under which the parties intend
that (i) the lease will be treated as an "Operating Lease" by the lessee
pursuant to Statement of Financial Accounting Standards No. 13, as amended and
(ii) the lessee will be entitled to various benefits ordinarily available to
owners (as opposed to lessees) of like property.
"Termination Date" means the earlier to occur of (i) June 30, 2004 and (ii)
the date on which all Obligations owed to the Lenders have been irrevocably paid
in full and the Commitments have been terminated.
"Total Capitalization" means the sum of Consolidated Debt plus Consolidated
Net Worth.
"Treaty on European Union" means the Treaty of Rome of 25 March 1957, as
amended by the Single European Act 1986 and the Maastricht Treaty (which was
signed at Maastricht on 7 February 1992, and came into force on 1 November 1993)
as amended from time to time.
"Unfunded Vested Liabilities" means, for any Plan at any time, the amount
(if any) by which (i) the present value of all vested nonforfeitable accrued
benefits under such Plan exceeds (ii) the fair market value of all Plan assets
allocable to such benefits, all determined as of the then most recent valuation
date for such Plan, but only to the extent that such excess represents a
potential liability of a member of the relevant Controlled Group to the PBGC or
the Plan.
"U.S. Dollar Equivalent" means the amount of U.S. Dollars which would be
realized by converting an Optional Currency into U.S. Dollars in the spot market
at the exchange rate quoted by the Agent, at approximately 11:00 a.m. (London,
England time) two (2) Business Days prior to the date on which a computation
thereof is required to be made, to major banks in the interbank foreign exchange
market for the purchase of U.S. Dollars for such Optional Currency.
9
<PAGE>
"Voting Stock" of any Person means capital stock of any class or classes
(however designated) having ordinary voting power for the election of directors
of such Person, other than stock having such power only by reason of the
happening of a contingency.
"Welfare Plan" means a "welfare plan", as defined in Section 3(l) of ERISA.
"Wholly-Owned" when used in connection with any Subsidiary of the Borrower
means a Subsidiary of which all of the issued and outstanding shares of stock or
other equity interests (other than directors' qualifying shares as required by
law) are owned by the Borrower and/or one or more of its Wholly-Owned
Subsidiaries.
"Year 2000 Problem" means the risk that computer applications used by the
Borrower and its Subsidiaries may be unable to recognize and perform properly
date-sensitive functions involving certain dates prior to and any date after
December 31, 1999.
Section 1.2. Interpretation. The foregoing definitions shall be equally
--------------
applicable to the singular and plural forms of the terms defined. All
references to times of day in this Agreement shall be references to Chicago,
Illinois time unless otherwise specifically provided. Where the character or
amount of any asset or liability or item of income or expense is required to be
determined or any consolidation or other accounting computation is required to
be made for the purposes of this Agreement, it shall be done in accordance with
GAAP as in effect from time to time except where such principles are
inconsistent with the specific provisions of this Agreement; provided that, if
the Borrower notifies the Agent that the Borrower wishes to amend any provision
hereof to eliminate the effect of any change after the date hereof in GAAP
(including its generally accepted application or interpretation) on the
operation of such provision (or if the Agent notifies the Borrower that the
Required Lenders wish to amend any provision for such purpose), then such
provision shall be interpreted, and compliance with such provision shall be
determined, on the basis of GAAP in effect immediately before the relevant
change in GAAP became effective, until either such notice is withdrawn or such
provision is amended in a manner satisfactory to the Borrower, the Agent and the
Required Lenders.
Section 1.3. Euro Provisions.
---------------
(a) If and to the extent that any provision of this Agreement dealing with
Euros relates to any state (or the currency of such state) that is not a
Participating Member State on the date hereof, such provision shall become
effective in relation to such state (and the currency of such state) at and from
the date on which such state becomes a Participating Member State.
(b) If, pursuant to any applicable EMU Legislation, any Loan is capable of
being made either in the Euro or in a National Currency Unit, such Loan shall be
made in Euro or such National Currency Unit as the Borrower may select.
(c) If the basis of accrual of interest or fees expressed in this
Agreement with respect to the currency of any state that is or becomes a
Participating Member State shall be inconsistent
10
<PAGE>
with any convention or practice in the London Interbank Market for the basis of
accrual of interest or fees in respect of the Euro, such convention or practice
shall replace such expressed basis effective as of and from the date on which
such state becomes a Participating Member State, provided, that if any Loan in
the currency of such state is outstanding immediately prior to such date, such
replacement shall take effect, with respect to such Loan, at the end of the
applicable Interest Period.
(d) Without prejudice and in addition to any method of conversion or
rounding prescribed by the EMU Legislation, each reference in this Agreement to
fixed amount or fixed amounts in a National Currency Unit to be paid to or by
the Agent shall be replaced by a reference to such reasonably comparable and
convenient fixed amount or fixed amounts in the Euro Unit as the Agent may from
time to time specify.
(e) Without prejudice to the respective liabilities of the Borrower to the
Lenders and the Lenders to the Borrower under or pursuant to this Agreement,
except as expressly provided in this Section, each provision of this Agreement
shall be subject to such reasonable changes of construction as the Agent in
consultation with the Borrower may from time to time specify to be necessary or
appropriate to reflect the introduction of or changeover to the Euro in
Participating Member States.
SECTION 2. THE CREDIT FACILITIES.
Section 2.1. Ratable Borrowings under the Revolving Credit. Subject to the
---------------------------------------------
terms and conditions hereof, each Lender severally and not jointly agrees to
make one or more loans (each a "Loan") to the Borrower from time to time before
the Termination Date on a revolving basis up to the amount of its commitment set
forth on Schedule 2.1 or pursuant to Section 10.11 (for each Lender, as such
amounts may be reduced from time to time in accordance with the terms hereof,
its "Commitment" and in the aggregate the "Commitments"), subject to any
reductions thereof. The aggregate principal amount of Loans outstanding (which,
for purposes of this Agreement in the case of Eurocurrency Loans denominated in
an Optional Currency shall mean the U.S. Dollar Equivalent thereof) to the
Borrower shall not at any time exceed the Commitments in effect at such time.
Each Borrowing of Loans shall be made ratably from the Lenders in proportion to
their respective Percentages. Loans may be repaid and their principal amount
reborrowed before the Termination Date, subject to the terms and conditions
hereof.
Section 2.2. Types of Loans and Minimum Borrowing Amounts. Borrowings of
--------------------------------------------
Loans may be outstanding as either Base Rate Loans or Eurocurrency Loans, as
selected by the Borrower pursuant to Section 2.3. Each Borrowing of Base Rate
Loans shall be in an amount not less than $5,000,000, or any larger amount that
is an integral multiple of $1,000,000. Each Borrowing of Eurocurrency Loans
denominated in U.S. Dollars shall be in a minimum amount of $5,000,000 or such
greater amount which is an integral multiple of $1,000,000. Each Borrowing of
Eurocurrency Loans denominated in an Optional Currency shall be in a minimum
amount for which the U.S. Dollar Equivalent is $10,000,000 or such greater
amount which is an integral multiple of 1,000,000 units of the relevant currency
or, solely in the case of a Eurocurrency Loan
11
<PAGE>
denominated in an Optional Currency being continued in the same currency, if
less, the same amount of such currency.
Section 2.3. Manner of Borrowing.
-------------------
(a) Notice to the Agent. The Borrower shall give irrevocable notice to the
Agent in the form of a Notice of Borrowing by no later than 10:30 a.m. (Chicago
time) (i) at least (x) three (3) Business Days in the case of Eurocurrency Loans
denominated in U.S. Dollars and (y) four (4) Business Days in the case of
Eurocurrency Loans denominated in any Optional Currency before the date on which
the Borrower requests Lenders to advance a Borrowing of Eurocurrency Loans and
(ii) on the date the Borrower requests Lenders to advance a Borrowing of Base
Rate Loans. The Loans included in each Borrowing shall bear interest initially
at the type of rate specified in such notice of Borrowing. Thereafter, the
Borrower may from time to time elect to change or continue the type of interest
rate borne by each of its Borrowings or, subject to Section 2.2's minimum amount
requirement for each outstanding Borrowing, a portion thereof, as follows: (i)
if such Borrowing is of Eurocurrency Loans, on the last day of the Interest
Period applicable thereto, the Borrower may continue part or all of such
Borrowing as Eurocurrency Loans denominated in the same currency for an Interest
Period or Interest Periods specified by the Borrower or, if such Borrowing is
denominated in U.S. Dollars, convert part or all of such Borrowing into Base
Rate Loans, (ii) if such Borrowing is of Base Rate Loans, on any Business Day,
the Borrower may convert all or part of such Borrowing into Eurocurrency Loans
for an Interest Period or Interest Periods specified by the Borrower. Notices of
the continuation of a Borrowing of Eurocurrency Loans for an additional Interest
Period or of the conversion of part or all of a Borrowing of Eurocurrency Loans
denominated in U.S. Dollars into Base Rate Loans or of Base Rate Loans into
Eurocurrency Loans must be given to the Agent in the form of a Notice of
Conversion/Continuation by no later than 10:30 a.m. (Chicago time) at least (x)
three (3) Business Days before the date of the requested continuation or
conversion for Loans denominated in U.S. Dollars and (y) four (4) Business Days
before the date of a requested continuation in the case of Eurocurrency Loans
denominated in an Optional Currency. The Borrower shall give such notices
concerning the advance, continuation, or conversion of a Borrowing by telephone
or facsimile (which notice shall be irrevocable once given and, if by telephone,
shall be promptly confirmed in writing) and shall specify the date of the
requested advance, continuation or conversion (which shall be a Business Day),
for Borrowings, the amount of the requested Borrowing, the type of Loans to
comprise such new, continued or converted Borrowing, and, if such Borrowing is
to be comprised of Eurocurrency Loans, the currency in which such Borrowing is
to be denominated and the Interest Period applicable thereto. The Borrower
agrees that the Agent may rely on any such telephonic or facsimile notice given
by any person it in good faith believes is an authorized representative of the
Borrower without the necessity of independent investigation and that, if any
such notice by telephone conflicts with any written confirmation, such
telephonic notice shall govern if the Agent has acted in reliance thereon. There
shall not be more than eight (8) Borrowings of Eurocurrency Loans outstanding at
any one time.
12
<PAGE>
(b) U.S. Dollar Equivalent Determination. The Administrative Agent will
determine the U.S. Dollar Equivalent Amount with respect to any (i) Borrowing
comprised of Eurocurrency Loans in Optional Currencies as of the requested
borrowing date, conversion date or continuation date, (ii) outstanding Loans in
Optional Currencies as of the last Business Day of each month, and (iii) during
the occurrence and continuation of an Event of Default, such other dates as may
be requested by the Required Banks (but in no event more frequently than once a
week) (each such date a "Determination Date").
(c) Notice to the Lenders. The Agent shall give prompt telephonic, telex
or facsimile notice to each Lender of any notice received pursuant to Section
2.3(a) relating to a Borrowing. The Agent shall give notice to the Borrower and
each Lender of the interest rate applicable to each Borrowing of Eurocurrency
Loans (but, if such notice is given by telephone, the Agent shall confirm such
rate in writing) promptly after the Agent has made such determination.
(d) Borrower's Failure to Notify. In the event the Borrower fails to give
notice pursuant to Section 2.3(a) of the continuation of any outstanding
principal amount of a Borrowing of Eurocurrency Loans or the conversion of U.S.
Dollar Loans denominated in U.S. Dollars before the last day of its then current
Interest Period within the period required by Section 2.3(a) and has not
notified the Agent within the period required by Section 2.7 that it intends to
prepay such Borrowing, such Borrowing shall automatically be continued as a
Borrowing of Eurocurrency Loans in the same currency with an Interest Period of
one month, subject to Section 4.2 hereof, including the restrictions contained
in the definition of "Interest Period."
(e) Disbursement of Loans. Each Lender will make the amount of its ratable
share of each Borrowing available to the Agent for the account of the Borrower
at the Agent's Payment Office on the borrowing date requested by the Borrower in
Same Day Funds and in the requested currency (i) in the case of a Borrowing
comprised of Loans in U.S. Dollars, by 11:00 a.m. (Chicago time), (ii) in the
case of a Borrowing comprised of Optional Currency Loans, by such time as the
Agent may determine to be necessary for such funds to be credited on such date
in accordance with normal banking practices in the place of payment. The
proceeds of all such Loans will then be made available to the Borrower by the
Agent by wire transfer in accordance with written instructions provided to the
Agent by the Borrower of like funds as received by the Agent; provided that the
Agent shall disburse such funds as it has received from the Lenders to the
Borrower (x) in the case of loans denominated in U.S. Dollars, no later than
11:00 a.m. (Chicago time), and (y) in the case of Optional Currency Loans no
later than two hours after the funding deadline specified by the Agent under
clause (ii) above. No Lender shall be responsible to the Borrower for any
failure by another Lender to fund its portion of a Borrowing, and no such
failure by a Lender shall relieve any other Lender from its obligation, if any,
to fund its portion of a Borrowing.
(f) Agent Reliance on Bank Funding. Unless the Agent shall have been
notified by a Lender before the date on which such Lender is scheduled to make
payment to the Agent of the proceeds of a Loan (which notice shall be effective
upon receipt) that such Lender does not
13
<PAGE>
intend to make such payment, the Agent may assume that such Lender has made such
payment when due and in reliance upon such assumption may (but shall not be
required to) make available to the Borrower the proceeds of the Loan to be made
by such Lender and, if any Lender has not in fact made such payment to the
Agent, such Lender shall, on demand, pay to the Agent the amount made available
to the Borrower attributable to such Lender together with interest thereon for
each day during the period commencing on the date such amount was made available
to the Borrower and ending on (but excluding) the date such Lender pays such
amount to the Agent at a rate per annum equal to the Federal Funds Rate. If such
amount is not received from such Lender by the Agent immediately upon demand,
the Borrower will, on demand, repay to the Agent the proceeds of the Loan
attributable to such Lender with interest thereon at a rate per annum equal to
the interest rate applicable to the relevant Loan.
Section 2.4. Interest Periods. As provided in Section 2.3(a), at the time
----------------
of each request for the advance or continuation of, or conversion into, a
Borrowing of Eurocurrency Loans, the Borrower shall select an Interest Period
applicable to such Loans from among the available options. The term "Interest
Period" means the period commencing on the date a Borrowing of Eurocurrency
Loans is advanced, continued, or created by conversion and ending on the date 1,
2, 3 or 6 months thereafter; provided, however, that:
(a) the Borrower may not select an Interest Period for a Borrowing of
Loans that extends beyond the Termination Date;
(b) whenever the last day of any Interest Period would otherwise be a
day that is not a Business Day, the last day of such Interest Period shall
be extended to the next succeeding Business Day; provided that if such
extension would cause the last day of such Interest Period to occur in the
following calendar month, the last day of such Interest Period shall be the
immediately preceding Business Day; and
(c) for purposes of determining an Interest Period, a month means a
period starting on one day in a calendar month and ending on the
numerically corresponding day in the next calendar month; provided,
however, that if there is no such numerically corresponding day in the
month in which an Interest Period is to end or if an Interest Period begins
on the last Business Day of a calendar month, then such Interest Period
shall end on the last Business Day of the calendar month in which such
Interest Period is to end.
Section 2.5. Maturity of Loans. Unless an earlier date is provided for
-----------------
under the terms of this Agreement, each Loan shall mature and become due and
payable by the Borrower on the Termination Date.
Section 2.6. Applicable Interest Rates. (a) Base Rate Loans. Each Base
------------------------- ---------------
Rate Loan shall bear interest (computed on the basis of a 365 or 366 day year,
as applicable, and actual days elapsed) on the unpaid principal amount thereof
from the date such Loan is made until maturity (whether by acceleration or
otherwise) at a rate per annum equal to the Base Rate from time to
14
<PAGE>
time in effect, payable on each Interest Payment Date for such Loan and at
maturity (whether by acceleration or otherwise).
"Base Rate" means for any day the greater of:
(i) the floating commercial loan rate announced by the Agent from
time to time as its "reference rate" for U.S. Dollar loans, in effect on
such day, with any change in such announced rate to be effective on the
date of the relevant change; and
(ii) the sum of (x) the rate per annum (rounded upwards, if necessary,
to the nearest 1/100th of 1%) equal to the weighted average of the rates on
overnight Federal funds transactions with members of the Federal Reserve
System arranged by Federal funds brokers on such day, as published by the
Federal Reserve Bank of New York on the next Business Day, provided, that
(A) if such day is not a Business Day, the rate on such transactions on the
immediately preceding Business Day so published on the next Business Day
shall apply, and (B) if no such rate is published on such next Business
Day, the rate for such day shall be the average rate quoted to the Agent on
such day for such transactions as determined by the Agent, plus (y) 1/2 of
1% (0.50%).
(b) Eurocurrency Loans. Each Eurocurrency Loan shall bear interest
------------------
(computed on the basis of (x) a year of 365 days and actual days elapsed in the
case of Eurocurrency Loans denominated in Pounds Sterling and (y) a year of 360
days and actual days elapsed in the case of all other Eurocurrency Loans;
provided that if the Borrower and the Agent mutually determine that a different
convention or practice arises with respect to Euros in the London interbank
market, computation of interest on Loans denominated in Euros shall be made
based on such convention or practice) on the unpaid principal amount thereof
from the date such Loan is made until maturity (whether by acceleration or
otherwise) at a rate per annum equal to the sum of the Applicable Eurocurrency
Margin plus the Offshore Rate applicable to such Loan, payable on each Interest
Payment Date for such Loan and at maturity (whether by acceleration or
otherwise).
"Offshore Rate" means, for any Interest Period, with respect to
-------------
Eurocurrency Rate Loans comprising part of the same Borrowing, the rate of
interest per annum (rounded upward to the next 1/100th of 1%) determined by
the Agent as follows:
Offshore Rate = LIBOR
---------------------------
1.00 - Eurodollar Reserve Percentage
Where,
"Eurodollar Reserve Percentage" means for any day for any Interest
-----------------------------
Period the maximum reserve percentage (expressed as a decimal, rounded
upward to the next 1/100th of 1%) in effect on such day (applicable to
BofA) under regulations issued from time to time by the Board of
Governors of the Federal Reserve
15
<PAGE>
System (or any successor) for determining the maximum reserve
requirement (including any emergency, supplemental or other marginal
reserve requirement) with respect to Eurocurrency funding (currently
referred to as "Eurocurrency liabilities"); and
"LIBOR" means (i) with respect to Eurocurrency Loans denominated in
-----
U.S. Dollars or Optional Currencies other than Euros the rate of
interest per annum determined by the Agent to be the arithmetic mean
(rounded upward to the next 1/100th of 1%) of the rate of interest per
annum notified to the Agent by BofA as the rate of interest at which
deposits in U.S. Dollars or Optional Currencies in the approximate
amount of the Loan to be made or continued as, or converted into, an
Eurocurrency Rate Loan by BofA (in its capacity as a Lender) and
having a maturity comparable to such Interest Period would be offered
to major banks in the relevant interbank market at their request at
approximately 10:30 a.m. (Chicago time) two Business Days prior to the
commencement of such Interest Period and (ii) with respect to
Eurocurrency Loans denominated in Euros, the rate appearing on the
applicable page of the Dow Jones Telerate Monitor Service (or on any
successor or substitute page of such service, or any successor to or
substitute for such service, providing rate quotations comparable to
those currently provided on such page of such service, as determined
by the Agent from time to time for purposes of providing quotations of
interest rate applicable to Euro deposits in the London interbank
market or, if no such service is available the rate notified to the
Agent by BofA as the rate it would offer Euros to major banks in the
London interbank market) as a rate of interest at which Euros in the
approximate amount of the Loan to be made or continued as, or
converted into, a Eurocurrency Loan by BofA (in its capacity as a
Lender) and having a maturity comparable to such Interest Period at
approximately 10:30 a.m. (Chicago time) two Business Days prior to the
commencement of such Interest Period or such other date as is
customary in the relevant Euro interbank market.
The Eurocurrency Rate shall be adjusted automatically as to all
Eurocurrency Rate Loans then outstanding as of the effective date of any
change in the Eurodollar Reserve Percentage.
"Applicable Eurocurrency Margin" means, with respect to the
Eurocurrency Loans as follows:
16
<PAGE>
IF AS OF THE RELEVANT APPLICABLE
MARGIN TESTING TIME, THE MARGIN FOR
CONSOLIDATED LEVERAGE EUROCURRENCY LOANS
RATIO IS
IS
Above .500 to 1 .75%
Greater than or equal to .450 to
1 but less than or equal to .500 to 1 .60%
Greater than or equal to .350 to 1
but less than .450 to 1 .50%
below .350 to 1 .40%
Not later than five (5) Business Days after the deadline for receipt by the
Agent of the financial statements called for by Section 6.6(a)(i) and (ii)
hereof for each fiscal quarter or year (each, a "Margin Testing Time"), the
Agent shall determine the Consolidated Leverage Ratio for the applicable period
based upon such financial statements and shall promptly notify the Borrower of
such determination and of any change in the Applicable Eurocurrency Margin and
the commitment fee resulting therefrom, any such change in the Applicable
Eurocurrency Margin and the commitment fee to be effective as of the delivery of
such notice to the Borrower and to continue in effect until the effective date
of the next quarterly redetermination in accordance with the foregoing; it being
-- -----
understood that if the Borrower fails to deliver the financial statements and
- ----------
certificate called for by Section 6.6(a)(i), (ii) or Section 6.6 (b) on or
before the 60th day (or, if applicable, the 120th day) after any fiscal quarter,
commencing on such 60th or 120th day, as applicable, until the date such
financial statements and certificate are delivered, the Applicable Eurocurrency
Margin shall be .75%. In determining the Consolidated Leverage Ratio as of any
Margin Testing Time, the Agent will accept the financial statements for the
Borrower and its Subsidiaries as prepared by the Borrower pursuant to Section
6.6 hereof, provided that such determination with respect to any calendar
quarter shall be subject to redetermination (to be effective retroactively as of
the effective date of the Applicable Eurocurrency Margin and commitment fee
being redetermined) in the event the final audited statements of the Borrower so
indicate for such calendar quarter. Any determination by the Agent of the
Consolidated Leverage Ratio shall be conclusive and binding upon the Borrower
absent demonstrable error provided that it has been made in good faith. The
Applicable Eurocurrency Margin on the Effective Date shall be .50%.
(c) Rate Determinations. The Agent shall determine each interest rate
-------------------
applicable to the Loans hereunder and such determination shall be conclusive and
binding except in the case of demonstrable error or willful misconduct.
17
<PAGE>
Section 2.7. Optional Prepayments. Subject to Section 2.11, the Borrower
--------------------
may, at any time or from time to time, by giving the Agent irrevocable notice
not later than (i) 10:30 a.m. (Chicago time) on the date of the proposed
prepayment, in the case of Base Rate Loans, (ii) 10:30 a.m. (Chicago time) three
Business Days prior to the proposed payment date, in the case of Eurocurrency
Loans in U.S. Dollars and (iii) 10:30 a.m. (Chicago time) four Business Days
prior to the proposed payment date in the case of Eurocurrency Rate Loans in
Optional Currencies, ratably prepay Loans in whole or in part, in minimum
amounts of (x) $5,000,000 or any multiple of $1,000,000 in excess thereof, in
the case of loans denominated in U.S. Dollars and (y) the U.S. Dollar Equivalent
of $10,000,000 or such greater amount which is an integral multiple of 1,000,000
units of the relevant currency thereof, in the case of Loans in Optional
Currencies. Such notice of prepayment shall specify the date and amount of such
prepayment and the type(s) of Loans to be prepaid and the relevant currency.
The Agent will promptly notify each Lender of its receipt of any such notice and
of the Lenders' ratable share of such prepayment. If such notice is given by
the Borrower, the Borrower shall make such prepayment and the payment amount
specified in such notice shall be due and payable on the date specified therein,
together with, in the case of Eurocurrency Loans, accrued interest to each such
date on the amount prepaid and any amounts required pursuant to Section 2.11.
Section 2.8. Mandatory Prepayments of Loans. If on any Determination Date
------------------------------
the Agent shall have determined that the aggregate U.S. Dollar Equivalent of
all Loans then outstanding exceeds the combined Commitments of the Lenders by
more than $250,000, due to a change in applicable rates of exchange between U.S.
Dollars and Optional Currencies, then the Agent shall give notice to the
Borrower that a prepayment is required under this Section and the Borrower shall
be obligated to pay the amount of such excess to the Agent within one Business
Day of the Borrower's receipt of such notice for the ratable benefit of the
Lenders as repayment of the Loans such that, after giving effect to such
prepayment the aggregate U.S. Dollar Equivalent amount of all Loans does not
exceed the combined Commitments. Payments of Loans under this Section 2.8 shall
be applied (and to the extent necessary made in the applicable currency) to
repay first, Base Rate Loans and second, Eurocurrency Loans. Each such
repayment, in the case of Eurocurrency Loans, shall be accompanied by a payment
of all accrued and unpaid interest on the Loans prepaid and shall be subject to
Section 2.11.
Section 2.9. Default Rate. If any payment of principal on any Loan is not
------------
made when due (whether by acceleration or otherwise), such Loan shall bear
interest (computed on the basis of a year of 360 days and actual days elapsed)
from the date such payment was due until paid in full, payable on demand, at a
rate per annum equal to:
(a) for any Base Rate Loan, the sum of two percent (2%) per annum
plus the Base Rate from time to time in effect; and
(b) for any Eurocurrency Loan, the sum of two percent (2%) per annum
plus the rate of interest in effect thereon at the time of such default
until the end of the Interest Period for such Loan and, thereafter, at a
rate per annum equal to the sum of two percent (2%) per annum plus the Base
Rate from time to time in effect.
18
<PAGE>
Section 2.10. Loan Accounts. Each Lender shall record on its books and
-------------
records the amount of each Loan outstanding from it to the Borrower, all
payments of principal and interest and the principal balance from time to time
outstanding thereon, the type of such Loan and, if a Eurocurrency Loan, the
applicable currency, Interest Period and interest rate applicable thereto. Such
record shall be prima facie evidence as to all such matters; provided, however,
that the failure of any holder to record any of the foregoing or any error in
any such record shall not limit or otherwise affect the obligation of the
Borrower to repay all Loans outstanding to it hereunder together with accrued
interest thereon.
Section 2.11. Funding Indemnity. If any Lender incurs any loss, cost or
-----------------
expense (including, without limitation, any loss of profit and any loss, cost,
expense or premium incurred by reason of the liquidation or re-employment of
deposits or other funds acquired by such Lender to fund or maintain any
Eurocurrency Loan or the relending or reinvesting of such deposits or amounts
paid or prepaid to such Lender) as a result of:
(a) any payment or prepayment of a Eurocurrency Loan on a date other
than the last day of its Interest Period (whether by acceleration,
mandatory prepayment or otherwise), or
(b) any failure (because of a failure to meet the conditions of
Section 4 or otherwise) by the Borrower to borrow a Eurocurrency Loan on
the date specified in a notice given pursuant to Section 2.3(a),
then, upon the demand of such Lender, the Borrower shall pay to such Lender such
amount as will reimburse such Lender for such loss, cost or expense (but
excluding the Applicable Eurocurrency Margin which would have otherwise accrued
on such prepaid amount). If any Lender makes such a claim for compensation, it
shall provide to the Borrower a certificate executed by an officer of such
Lender setting forth the amount of such loss, cost or expense in reasonable
detail (including an explanation of the basis for and the computation of such
loss, cost or expense), and the amounts shown on such certificate shall be
conclusive and binding absent manifest error.
Section 2.12. Commitment Reductions. The Borrower shall have the right at
---------------------
any time and from time to time, upon five (5) Business Days' prior written
notice to the Agent, to terminate the Commitments without premium or penalty, in
whole or in part, any partial termination to be in an amount not less than
$10,000,000, and in each case in integral multiples of $1,000,000, and such
termination shall be allocated ratably among the Lenders in proportion to their
respective Commitments; provided that the Commitments may not be reduced to an
amount less than the sum of the aggregate principal amount of Loans then
outstanding. The Agent shall give prompt notice to each Lender of any such
termination of Commitments. Any termination of Commitments pursuant to this
Section 2.12 may not be reinstated.
19
<PAGE>
SECTION 3. FEES AND PAYMENTS.
Section 3.1. Fees. (a) Commitment Fee. For the period from the Effective
----
Date to and including the Termination Date, the Borrower shall pay to the Agent
for the ratable account of the Lenders a commitment fee accruing at a rate per
annum (computed on a basis of a year of 360 days, as the case may be, and actual
days elapsed) on the actual daily difference between the Commitments and the
principal amount of Loans outstanding (which amount, for purposes of this
Section 3.1(a) shall, with regard to Eurocurrency Loans denominated in any
Optional Currency, be based on the U.S. Dollar Equivalent determined from time
to time on the applicable Determination Dates) as follows:
IF AS OF THE RELEVANT
MARGIN TESTING TIME, THE
CONSOLIDATED LEVERAGE
RATIO COMMITMENT FEE
IS IS
Above .500 to 1 .25%
Greater than or equal to .450 to
1 but less than or equal to .500 to 1 .20%
Greater than or equal to .350 to 1
but less than .450 to 1 .175%
below .350 to 1 .15%
such fee being payable in arrears commencing on September 30, 1999, on the last
day of each calendar quarter thereafter and on the Termination Date, unless the
Commitments are terminated in whole on an earlier date, in which event the
commitment fee for the period to but not including the date of such termination
shall be paid in whole on the date of such termination. The applicable
commitment fee shall be determined in accordance with the last paragraph of
Section 2.6(b). In the event the required financial statements and certificate
have not been delivered by the time required, the commitment fee shall be .25%
until such financial statements are delivered. The commitment fee on the
Effective Date shall be .175%.
(b) Agent and Administration Fees. The Borrower shall pay to the Agent and
the Arranger the fees agreed to among the Agent, the Arranger and the Borrower
in a letter dated June 1, 1999 (the "Fee Letter") or as otherwise agreed between
them in writing.
Section 3.2. Place and Application of Payments. All payments to be made by
---------------------------------
the Borrower shall be made without set-off, recoupment or counterclaim. Except
as otherwise expressly provided herein, all payments by the Borrower shall be
made to the Agent for the account of the Lenders at the Agent's Payment Office
and, with respect to principal of, and interest on and any other amounts
relating to, any Eurocurrency Loan in Optional Currency, shall
20
<PAGE>
be made in the Optional Currency in which such Loan is denominated or payable,
and, with respect to all other amounts payable hereunder, shall be made in U.S.
Dollars. Such payment shall be made in Same Day Funds, and (i) in the case of
Optional Currency payments, no later than such time on the dates specified
herein as may be determined by the Agent to be necessary for such payment to be
credited on such date in accordance with normal banking procedures in the place
of payment, and (ii) in the case of any U.S. Dollar payments, no later than
10:30 a.m. (Chicago time), on the date specified. The Agent will promptly
distribute like funds to each Lender, pro rata, based on each Lender's
Percentage. Any payment which is received by the Agent later than the time
determined as provided in clauses (i) and (ii) above, shall be deemed to have
been received on the following Business Day and any applicable interest or fee
shall continue to accrue.
Section 3.3. Withholding Taxes.
-----------------
(a) Payments Free of Withholding. Except as otherwise required by law and
subject to Sections 3.3(b) and (c), each payment by the Borrower under, this
Agreement shall be made without withholding for or on account of any present or
future taxes (other than taxes imposed on, or measured by reference to, the net
income or net profits of, or franchise taxes imposed on, the recipient) imposed
by or within the jurisdiction in which the Borrower is domiciled, any
jurisdiction from which the Borrower makes any payment, or (in each case) any
political subdivision or taxing authority thereof or therein. If any such
withholding is so required, the Borrower shall make the withholding, pay the
amount withheld to the appropriate Governmental Authority before penalties
attach thereto or interest accrues thereon and forthwith pay such additional
amount as may be necessary to ensure that the net amount actually received by
each Lender and the Agent free and clear of such taxes (including such taxes on
such additional amount) is equal to the amount that Lender or the Agent (as the
case may be) would have received had such withholding not been made. If the
Agent or any Lender pays any amount in respect of any such taxes, penalties or
interest the Borrower shall reimburse the Agent or that Lender for that payment
on demand in the currency in which such payment was made. If the Borrower pays
any such taxes, penalties or interest, it shall deliver written evidence of such
payment to the Lender or Agent on whose account such withholding was made (with
a copy to the Agent if not the recipient of the original) on or before the
thirtieth day after payment.
(b) U.S. Withholding Tax Exemptions. Each Lender that is not a United
States person (as such term is defined in Section 7701(a)(30) of the Code) shall
submit to the Borrower and the Agent, two duly completed and signed copies of
either Form 1001 (entitling such Lender to a complete exemption from withholding
under the Code on all amounts to be received by such Lender, including fees,
hereunder) or Form 4224 (relating to all amounts to be received by such Lender,
including fees, hereunder) of the United States Internal Revenue Service.
Thereafter and from time to time, each Lender shall submit to the Borrower and
the Agent such additional duly completed and signed copies of one or the other
of such Forms (or such successor forms as shall be adopted from time to time by
the relevant United States taxing authorities) as may be (i) notified by the
Borrower, directly or through the Agent, to such Lender and (ii) required under
then-current United States law or regulations to avoid or reduce United States
withholding taxes
21
<PAGE>
on payments in respect of all amounts to be received by such Lender, including
fees, hereunder. Upon the request of the Borrower, each Lender that is a United
States person (as such term is defined in Section 7701(a)(30) of the Code) shall
submit to the Borrower a certificate to the effect that it is such a United
States person.
(c) Notwithstanding the foregoing, the Borrower shall not be required to
make any payments or reimburse the Agent or any Lender under this Section 3.3
with respect to any taxes imposed on or paid by the Agent or such Lender more
than one hundred eighty (180) days before the date on which a request for
payment or reimbursement is delivered to the Borrower. If the Agent or any
Lender is entitled to additional payments or reimbursement under this Section
3.3, it agrees to designate a different Lending Office if such designation will
avoid the need for, or reduce the amount of, such additional payments or
reimbursement and will not, in the sole judgment of the Agent or such Lender, be
otherwise disadvantageous to it.
SECTION 4. CONDITIONS PRECEDENT.
Section 4.1. Agreement Effectiveness. This Agreement shall be and become
-----------------------
effective on the date (the "Effective Date") on which the Borrower, the Lenders
and the Agent shall have executed and delivered this Agreement and the Agent
shall have received (or, in the case of Sections 4.1(e), (f) and (g), the Agent
shall be satisfied that such conditions are met) all of the following, each duly
executed and dated the Effective Date (or such earlier date as shall be
satisfactory to the Agent) in form and substance satisfactory to the Agent:
(a) the opinion of Sidley & Austin, legal counsel to the Borrower covering
the matters referred to in Sections 5.1 through 5.5, 5.7 and 5.8 of this
Agreement and such additional matters as the Agent or Required Lenders may
reasonably require;
(b) copies of resolutions of the Board of Directors of the Borrower
authorizing the execution and delivery of the Credit Documents to which it is a
party, certified by the Secretary or Assistant Secretary of the Borrower;
(c) specimen signatures of the persons authorized to execute Credit
Documents on the Borrower's behalf, certified by the Secretary or Assistant
Secretary of the Borrower;
(d) payment of all fees then due and owing to the Agent and each Lender
under Section 3.1;
(e) all legal matters incident to the execution and delivery of the Credit
Documents shall be satisfactory to the Required Lenders and no event having a
Material Adverse Effect shall have occurred since December 31, 1998;
(f) evidence, reasonably satisfactory to the Agent, that (i) all
outstanding Debt under the Existing Credit Agreements have been, or concurrently
with the issuance of the initial Loans
22
<PAGE>
will be, paid in full and (ii) all commitments under the Existing Credit
Agreements have been or concurrently with the issuance of the initial Loans will
be terminated; and
(g) there shall not have been any material disruption in the capital
markets generally which could, in the reasonable good faith determination of the
Agent, have a materially adverse effect on the ability to extend, or maintain
any commitment to extend, at the time contemplated hereby, senior bank financing
of the type contemplated hereby or to syndicate the same.
Section 4.2. All Credit Events. At the time of each Credit Event
-----------------
hereunder:
(a) The Agent shall have received the notice required by Section 2.3;
(b) Each of the representations and warranties of the Borrower set
forth in Section 5 shall be and remain true and correct in all material
respects as of the date of such Credit Event, except to the extent that any
such representation or warranty relates solely to an earlier date, in which
case it shall have been true and correct as of such earlier date; and
(c) No Default or Event of Default shall have occurred and be
continuing or would occur as a result of such Credit Event.
Each request for a Borrowing and each request for the conversion or continuance
of a Borrowing shall be deemed to be a representation and warranty by the
Borrower on the date of such Borrowing, conversion or continuance as to the
facts specified in subsections (b) and (c) of this Section 4.2.
SECTION 5. REPRESENTATIONS AND WARRANTIES.
The Borrower represents and warrants to each Lender and the Agent as
follows:
Section 5.1. Organization. (a) The Borrower and each of its Subsidiaries:
------------
(i) is duly organized and existing and in good standing under the laws of the
jurisdiction of its organization; (ii) has all necessary power to own the
Property and assets it uses in its business and otherwise to carry on its
present business and the business it currently proposes to transact; and (iii)
is duly licensed or qualified and in good standing in each jurisdiction in which
the nature of the business transacted by it or the nature of the property owned
or leased by it makes such licensing or qualification necessary and in which the
failure to be so licensed or qualified would have a Material Adverse Effect.
(b) As of the Effective Date, the Borrower has no Subsidiaries other than
those Subsidiaries listed on Schedule 5.1.
Section 5.2. Corporate Power and Authority. The Borrower has the corporate
-----------------------------
power and authority to execute, deliver and carry out the terms and provisions
of the Credit Documents to
23
<PAGE>
which it is a party and has taken all necessary corporate action to authorize
the execution, delivery and performance of such Credit Documents. The Borrower
has duly executed and delivered each Credit Document to which it is a party and
each such Credit Document constitutes the legal, valid and binding obligation of
the Borrower enforceable in accordance with its terms, except that
enforceability may be limited by bankruptcy, insolvency, fraudulent conveyance,
fraudulent transfer, reorganization, moratorium or other similar laws now or
hereafter in effect relating to creditors' rights generally and by general
principles of equity (regardless of whether enforcement is sought in equity or
at law).
Section 5.3. No Violation. Neither the execution, delivery or performance
------------
by the Borrower of the Credit Documents to which it is a party nor compliance by
it with the terms and provisions thereof, nor the consummation of the
transactions contemplated herein or therein, will (i) contravene any applicable
provision of any law, statute, rule or regulation, or any order, writ,
injunction or decree of any court or governmental instrumentality, (ii) conflict
with or result in any breach of any term, covenant, condition or other provision
of, or constitute a default under, or result in the creation or imposition of
(or the obligation to create or impose) any Lien upon any of the property or
assets of the Borrower or any of its Subsidiaries under the terms of any
Contractual Obligation to which the Borrower or any of its Subsidiaries is a
party or by which it or any of its property or assets are bound or to which it
may be subject or (iii) violate any provision of the Articles of Incorporation
or By-Laws or corresponding organizational documents of the Borrower or any of
its Subsidiaries.
Section 5.4. Governmental Authorization. No material approval, consent,
--------------------------
exemption, authorization, or other action by, or notice to, or filing with, any
Governmental Authority which has not been obtained or given is necessary or
required in connection with the execution, delivery or performance by, or
enforcement against, the Borrower of any Credit Document.
Section 5.5. Litigation. There are no actions, suits or proceedings
----------
pending or, to the knowledge of the Borrower or any of its Subsidiaries,
threatened, involving the Borrower or any of its Subsidiaries (i) that are
likely to have a Material Adverse Effect or (ii) that could reasonably be
expected to have a material adverse effect on the rights or remedies of the
Lenders or on the ability of the Borrower to perform its obligations to the
Lenders under this Agreement.
Section 5.6. Use of Proceeds; Margin Regulations. (a) The proceeds of all
-----------------------------------
Loans shall be used (i) to pay fees and expenses incurred in connection with
this Agreement, (ii) to repay Debt under the Existing Credit Agreements and
(iii) for general corporate purposes.
(b) No proceeds of any Loan will be used to purchase or carry any "margin
stock" (as defined in Regulation U of the Board of Governors of the Federal
Reserve System) or to extend credit for the purpose of purchasing or carrying
any "margin stock."
(c) Notwithstanding any of the foregoing, no proceeds of any Loan will be
used to finance, fund or complete any hostile acquisition of any Person.
24
<PAGE>
Section 5.7. Investment Company Act. Neither the Borrower nor any of its
----------------------
Subsidiaries is an "investment company" or a company "controlled" by an
"investment company," within the meaning of the Investment Company Act of 1940,
as amended.
Section 5.8. Public Utility Holding Company Act. Neither the Borrower nor
----------------------------------
any of its Subsidiaries is a "holding company," or a "subsidiary company" of a
"holding company," or an "affiliate" of a "holding company" or of a "subsidiary
company" of a "holding company," within the meaning of the Public Utility
Holding Company Act of 1935, as amended.
Section 5.9. True and Complete Disclosure. All factual information
----------------------------
heretofore or contemporaneously furnished by or on behalf of the Borrower or its
Subsidiaries to the Agent or any Lender (including, without limitation, all
information contained herein) in connection with this agreement or any
transaction contemplated herein is, and all other such factual information
hereafter furnished by or on behalf of any such Persons in writing to the Agent
or any Lender will be, true and accurate in all material respects on the date of
such information and not incomplete by omitting to state any material fact
necessary to make such information not misleading at such time in light of the
circumstances under which such information was provided.
Section 5.10. Financial Statements. The audited consolidated financial
--------------------
statements of the Borrower as at December 31, 1998 and the unaudited
consolidated financial statements of the Borrower for the three month period
ended March 31, 1999, copies of which have been delivered to the Lenders, in
each case (i) have been prepared in accordance with GAAP consistently applied
throughout the periods involved (except as disclosed therein) and (ii) fairly
present on a consolidated basis the financial position of the Borrower and its
Subsidiaries, as of the dates thereof, and the results of operations for the
periods covered thereby. The Borrower and its Subsidiaries have no material
contingent liabilities other than those disclosed in the financial statements
referred to in this Section 5.10 or in any supplemental report already furnished
to the Lenders in writing. With respect to any representation and warranty
which is deemed to be made after the date hereof by the Borrower this
representation shall be deemed to refer to the financial statements most
recently delivered by the Borrower to the Lenders.
Section 5.11. No Material Adverse Change. No event has occurred which had a
--------------------------
Material Adverse Effect since December 31, 1998.
Section 5.12. Labor Controversies. There are no labor controversies pending
-------------------
or, to the best knowledge of the Borrower or its Subsidiaries, threatened
against the Borrower and its Subsidiaries that can reasonably be foreseen to
threaten a Material Adverse Effect.
Section 5.13. Taxes. The Borrower and its Subsidiaries have filed all
-----
United States federal tax returns and all other tax returns required to be filed
and have paid all taxes due, except such taxes, if any, as are being contested
in good faith and for which adequate reserves have been provided. No tax liens
have been filed and no claims are being asserted for taxes, which liens or
claims could have a Material Adverse Effect. The charges, accruals and reserves
25
<PAGE>
on the books of the Borrower and its Subsidiaries for taxes and other
governmental charges are adequate.
Section 5.14. ERISA. The Borrower and its Subsidiaries and each other
-----
member of its Controlled Group has fulfilled its obligations under the minimum
funding standards of and is in compliance in all material respects with the
Employee Retirement Income Security Act of 1974, as amended ("ERISA"), and with
the Code to the extent applicable to it, and has not incurred any liability to
the Pension Benefit Guaranty Corporation ("PBGC") or a Plan under Title IV of
ERISA other than a liability to the PBGC for premiums under Section 4007 of
ERISA. Neither the Borrower nor its Subsidiaries have any contingent liability
with respect to any post-retirement benefits under a Welfare Plan, other than
liability for continuation coverage described in Part 6 of Title I of ERISA.
Section 5.15. Intellectual Property. The Borrower and its Subsidiaries own
---------------------
or hold a valid license to use all the material patents, trademarks, permits,
service marks, trade names, technology, know-how and formulas or other rights
related to the foregoing, free of any burdensome restrictions, that are used in
the operation of the business of the Borrower or of its Subsidiaries as
presently conducted and as proposed to be conducted as determined by the
Borrower and its Subsidiaries in their reasonable judgment, except for such
intellectual property or burdensome restrictions which are not likely to
individually or in the aggregate, have a Material Adverse Effect.
Section 5.16. Compliance with Statutes, Etc. The Borrower and its
-----------------------------
Subsidiaries are in compliance with all applicable statutes, regulations and
orders of and all applicable restrictions imposed by, all governmental bodies,
domestic and foreign, in respect of the conduct of its business and the
ownership of its Property, except such non-compliance as is not likely to,
individually or in the aggregate, have a Material Adverse Effect.
Section 5.17. Environmental Matters. (a) The Borrower and its Subsidiaries
---------------------
have complied with, and on the date of each Credit Event are in compliance with,
all applicable Environmental Laws and the requirements of any permits issued
under such Environmental Laws except to the extent such noncompliance is not
likely to have a Material Adverse Effect. There are no pending or, to the best
knowledge of the Borrower and its Subsidiaries, past or threatened Environmental
Claims against the Borrower or its Subsidiaries of any real property owned or
operated by the Borrower or its Subsidiaries that individually or in the
aggregate would reasonably be expected to have a Material Adverse Effect. There
are no conditions or occurrences on any real property owned or operated by the
Borrower or its Subsidiaries or, to the best knowledge of the Borrower and its
Subsidiaries, on any property adjoining or in the vicinity of any such real
property that would reasonably be expected (i) to form the basis of an
Environmental Claim against the Borrower or its Subsidiaries or any such real
property that individually or in the aggregate would reasonably be expected to
have a Material Adverse Effect or (ii) to cause any such real property to be
subject to any restrictions on the ownership, occupancy, use or transferability
of such real property by the Borrower or its Subsidiaries under
26
<PAGE>
any applicable Environmental Law which restrictions are likely to have a
Material Adverse Effect.
(b) Hazardous Materials have not at any time been generated, used, treated
or stored on, or transported to or from, any real property owned or operated by
the Borrower or its Subsidiaries in a manner that has violated or would
reasonably be expected to violate any Environmental Law except such violations
as are not likely, individually or in the aggregate, to have a Material Adverse
Effect. Hazardous Materials have not at any time been released on or from any
real property located in the United States owned or operated by the Borrower or
any of its Subsidiaries except such releases as are not likely, individually or
in the aggregate, to have a Material Adverse Effect. To the best of the
Borrower's knowledge, there are not now any underground storage tanks located on
any real property located in the United States owned or operated by the Borrower
or its Subsidiaries.
Section 5.18. Existing Debt. Schedule 5.18 contains a complete list of all
-------------
Debt (other than the Obligations hereunder and under the Existing Credit
Agreements) of the Borrower and its Subsidiaries as of March 31, 1999 and all
other Debt incurred by the Borrower or any of its Subsidiaries between March 31,
1999 and the Effective Date which had an original principal amount in excess of
$25,000,000.
Section 5.19. No Burdensome Restrictions; Compliance with Agreements.
------------------------------------------------------
Neither the Borrower nor any of its Subsidiaries is party or subject to any law,
regulation, rule or order, or any Contractual Obligation that (individually or
in the aggregate) has or reasonably could be foreseen to have a Material Adverse
Effect.
Section 5.20. Year 2000 Problem. The Borrower and its Subsidiaries have
-----------------
reviewed the areas within their business and operations which could be adversely
affected by, and have developed or are developing a program to address on a
timely basis, the Year 2000 Problem. Based on such review and program, the
Borrower reasonably believes that the Year 2000 Problem will not have a Material
Adverse Effect.
SECTION 6. COVENANTS.
The Borrower covenants and agrees that, so long as any Loan is outstanding
or any Commitment is available to or in use by the Borrower hereunder, except to
the extent compliance in any case is waived in writing by the Required Lenders:
Section 6.1. Existence. The Borrower will, and will cause each of its
---------
Subsidiaries to, preserve and maintain its existence, subject to the provisions
of Section 6.11.
Section 6.2. Maintenance. The Borrower will, and will cause each of its
-----------
Subsidiaries to, maintain, preserve and keep its plants, properties and
equipment necessary to the proper conduct of its business in reasonably good
repair, working order and condition and will from time to time make all
reasonably necessary repairs, renewals, replacements, additions and betterments
thereto
27
<PAGE>
so that at all times such plants, properties and equipment are reasonably
preserved and maintained; provided, however, that nothing in this Section 6.2
shall prevent the Borrower or any of its Subsidiaries from discontinuing the
operation or maintenance of any such properties if such discontinuance is, in
the judgment of the Borrower or any such Subsidiary, as applicable, desirable in
the conduct of its business or the business of its Subsidiary and not
disadvantageous to the Lenders.
Section 6.3. Taxes. The Borrower will, and will cause each of its
-----
Subsidiaries to, duly pay and discharge all taxes, rates, assessments, fees and
governmental charges upon or against it or its properties before payment is
delinquent and before penalties accrue thereon, unless and to the extent that
the same is being contested in good faith and by appropriate proceedings and
appropriate reserves have been established in conformity with GAAP.
Section 6.4. ERISA. The Borrower will, and will cause each of its
-----
Subsidiaries to, promptly pay and discharge all obligations and liabilities
arising under ERISA of a character which if unpaid or unperformed might result
in the imposition of a Lien against any of its properties or assets and will
promptly notify the Agent of (i) the occurrence of any reportable event (as
defined in ERISA) relating to a Plan, other than any such event of which the
PBGC has waived notice by regulation, (ii) receipt of any notice from PBGC of
its intention to seek termination of any Plan or appointment of a trustee
therefor, (iii) its or any of its Subsidiaries' intention to terminate or
withdraw from any Plan, and (iv) the occurrence of any event that could result
in the incurrence by any member of the Controlled Group of any material
liability, fine or penalty, or any material increase in the contingent liability
of the Borrower or any of its Subsidiaries in connection with any post-
retirement Welfare Plan benefit.
Section 6.5. Insurance. The Borrower will, and will cause each of its
---------
Subsidiaries to, insure, and keep insured, all insurable Property and assets
owned by it of a character usually insured by companies similarly situated and
operating like Property or assets, to the extent usually insured (subject to
self-insured retentions) by such similar companies. The Borrower and each of
its Subsidiaries will also insure employers' and public and product liability
risks. The Borrower will, upon request of the Agent, furnish to the Agent a
summary setting forth the nature and extent of the insurance maintained pursuant
to this Section 6.5.
Section 6.6. Financial Reports and Other Information. (a) The Borrower and
---------------------------------------
its Subsidiaries will maintain a system of accounting in accordance with
generally accepted accounting principles and will furnish to the Agent and each
Lender such information about the business and financial condition of the
Borrower and its Subsidiaries as the Agent may reasonably request; and, without
any request, will furnish to the Agent and each Lender:
(i) Within 60 days after the end of each of the first three fiscal
quarters of each fiscal year of the Borrower, the consolidated balance
sheet of the Borrower and its Subsidiaries as at the end of such fiscal
quarter and the related consolidated statement of income and of cash flow
for such fiscal quarter and for the portion of the fiscal year ended with
the last day of such fiscal quarter, all of which shall be in reasonable
detail
28
<PAGE>
and certified by the Executive Vice President or the Vice President-Risk
Management of the Borrower that they fairly present the financial condition
of the Borrower and its Subsidiaries (as applicable) as of the dates
indicated and the results of their operations and changes in their cash
flows for the periods indicated and that it has been prepared in accordance
with the terms of this Agreement, subject to normal year-end audit
adjustments.
(ii) Within 120 days after the end of each fiscal year of the
Borrower, the consolidated balance sheet of the Borrower and its
Subsidiaries as at the end of such fiscal year and the related consolidated
statement of income and retained earnings and of cash flows for such fiscal
year and setting forth consolidated comparative figures for the preceding
fiscal year certified by PriceWaterhouse Coopers or other independent
certified public accountants of recognized national standing, in each case
to the effect that such statements fairly present the financial condition
of the Borrower and its Subsidiaries as of the dates indicated and the
results of their operations and changes.
(iii) Promptly after the sending or filing thereof, copies of all
financial statements and projections that the Borrower sends to its
shareholders and copies of all filings and registrations with, and reports
to, the SEC by the Borrower or any of its Subsidiaries.
(b) Each financial statement furnished to the Agent and each Lender
pursuant to subsections (i) and (ii) of Section 6.6(a) shall be accompanied by
(A) a written certificate signed by the Borrower's Executive Vice President or
Vice President-Risk Management to the effect that (i) no Default or Event of
Default has occurred during the period covered by such statements or, if any
such Default or Event of Default has occurred during such period, setting forth
a description of such Default or Event of Default and specifying the action, if
any, taken by the Borrower to remedy the same, and (ii) the representations and
warranties contained in Section 5 are true and correct in all material respects
as though made on the date of such certificate, except as otherwise described
therein, and (B) a Compliance Certificate in the form of Exhibit C showing the
Borrower's compliance with the covenants set forth in Sections 6.14, 6.15, 6.17
and 6.18, and attaching an updated Schedule 5.1 if any information pertaining
thereto has changed since the previous Compliance Certificate was submitted.
(c) Promptly after obtaining knowledge of any of the following, the
Borrower shall provide each Lender with written notice in reasonable detail of:
(i) any pending or threatened material Environmental Claim against
the Borrower or any of its Subsidiaries or any real property owned or
operated by the Borrower or any of its Subsidiaries;
(ii) any condition or occurrence on any real property owned or
operated by the Borrower or any of its Subsidiaries that (x) results in
material noncompliance by the Borrower or any of its Subsidiaries with any
Environmental Law or (y) could reasonably
29
<PAGE>
be anticipated to form the basis of a material Environmental Claim against
the Borrower or any of its Subsidiaries or any such real property;
(iii) any condition or occurrence on any real property owned or
operated by the Borrower or any of its Subsidiaries that could reasonably
by anticipated to cause such real property to be subject to any material
restrictions on the ownership, occupancy, use or transferability by the
Borrower or its Subsidiary, as the case may be, of its interest in such
real property under any Environmental Law; and
(iv) the taking of any material removal or remedial action in
response to the actual or alleged presence of any Hazardous Material on any
real property owned or operated by the Borrower or any of its Subsidiaries.
For purposes of this Section 6.6(c), "material" shall refer to an event or
circumstance that could reasonably be expected to result in losses, costs or
liabilities (in excess of any cash escrow available to the Borrower),
individually or in the aggregate, in excess of $1,500,000.
(d) The Borrower will promptly (and in any event within one Business Day
after an officer of the Borrower has knowledge thereof) give notice to the Agent
of:
(i) the occurrence of any Default or Event of Default;
(ii) any default or event of default under any Contractual Obligation
of the Borrower or any of its Subsidiaries which is likely to have a
Material Adverse Effect;
(iii) any litigation or governmental proceeding of the type described
in clause (i) or (ii) of Section 5.5;
(iv) any circumstance that has had a Material Adverse Effect; and
(v) any information indicating that the Year 2000 Problem could
reasonably be expected to have a Material Adverse Effect.
Section 6.7. Lender Inspection Rights. Upon reasonable notice from the
------------------------
Agent the Borrower will permit the Agent (and such Persons as the Agent may
designate as well as any Lender who wishes to accompany the Agent) during normal
business hours to visit and inspect any of the properties of the Borrower to
examine all its books of account, records, reports and other papers, to make
copies and extracts therefrom, and to discuss its respective affairs, finances
and accounts with its officers, employees and independent public accountants
(and by this provision the Borrower authorizes such accountants to discuss with
the Agent (and such Persons as the Agent may designate) the finances and affairs
of the Borrower and its Subsidiaries) all at such reasonable times and as often
as may be reasonably requested.
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Section 6.8. Conduct of Business. The Borrower and each of its
-------------------
Subsidiaries will not engage in any line of business outside the packaging
industry.
Section 6.9. Fiscal Years and Quarters. The Borrower will, for financial
-------------------------
reporting purposes, maintain for itself and its Subsidiaries a fiscal year that
ends on December 31 of each year and fiscal quarters that end on March 31, June
30, September 30 and December 31 of each year.
Section 6.10. Limitation on Certain Restrictions on Subsidiaries. The
--------------------------------------------------
Borrower will not, and will not permit any of its Subsidiaries to, directly or
indirectly, create or otherwise permit to exist or become effective any Lien or
restriction on the ability of any such Subsidiary to (a) pay dividends or make
any other distributions on its capital stock or any other interest or
participation in its profits owned by the Borrower or any Subsidiary of the
Borrower, or pay any Indebtedness owed to the Borrower or a Subsidiary of the
Borrower, or (b) make loans or advances to the Borrower or any Subsidiaries of
the Borrower, except for such Liens or restrictions existing under or by reason
of (i) applicable law, (ii) this Agreement, (iii) customary provisions
restricting subletting or assignment of any lease governing a leasehold interest
of the Borrower or a Subsidiary of the Borrower and (iv) customary provisions
restricting assignment of any licensing agreement entered into by the Borrower
or a Subsidiary of the Borrower in the ordinary course of business.
Section 6.11. Mergers, Consolidations and Asset Sales. (a) The Borrower
---------------------------------------
will not, and will not permit any of its Subsidiaries to, be a party to any
merger or consolidation or engage in any Asset Sale of all or a "substantial
part" of the consolidated assets (including assets consisting of stock) of the
Borrower and its Subsidiaries, except for any such merger or consolidation (x)
by any Subsidiary into or with the Borrower or into or with any Subsidiary, (y)
by any Subsidiary provided the survivor is a Subsidiary or (z) by the Borrower
provided the Borrower is the surviving corporation. As used in this Section
6.11(a), an Asset Sale shall be deemed to be of a "substantial part" of the
consolidated assets of the Borrower and its Subsidiaries if the book value of
such assets, when added to the book value of all other assets (including assets
consisting of stock) sold, leased, transferred or disposed of by the Borrower
and its Subsidiaries since December 31, 1998 (other than inventory in the
ordinary course of business) exceeds 5% of their consolidated assets (including
assets consisting of stock) as of the date of the most recent annual audited
financial statements delivered to the Lenders.
(b) The Borrower will not permit any of its Subsidiaries to issue or sell
any shares of stock of any class (including as "stock" for the purpose of this
subsection any warrants, rights or options to purchase or otherwise acquire
stock or other Securities exchangeable for or convertible into stock) of such
Subsidiary to any Person other than the Borrower or a Wholly-Owned Subsidiary of
the Borrower, except for the purpose of qualifying directors, if the effect of
such issuance of sale would be to dilute the voting rights or ownership
interests of the Borrower in any such Subsidiary to fifty percent (50%) or less.
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Section 6.12. Use of Property and Facilities; Environmental, Health and
---------------------------------------------------------
Safety Laws. The Borrower will, and will cause each of its Subsidiaries to,
- -----------
comply in all material respects with all Environmental Laws applicable to or
affecting the properties or business operations of the Borrower or its
Subsidiaries except to the extent such noncompliance is not likely to have a
Material Adverse Effect.
Section 6.13. Liens. The Borrower will not, and will not permit any of its
-----
Subsidiaries to, create, incur, assume or suffer to exist any Lien of any kind
on any Property or asset of any kind of the Borrower or any Subsidiary of the
Borrower, except the following (collectively, the "Permitted Liens"):
(a) Liens arising in the ordinary course of business by operation of
law in connection with worker's compensation, unemployment insurance, old
age benefits, social security obligations, taxes, assessments, statutory
obligations or other similar charges, good faith deposits, pledges or other
Liens in connection with bids, tenders, contracts or leases to which the
Borrower or its Subsidiaries is a party or other deposits required to be
made in the ordinary course of business; provided that in each case the
obligation secured is not for Debt and is not overdue or, if overdue, is
being contested in good faith by appropriate proceedings and reserves in
conformity with GAAP have been provided therefor;
(b) mechanics', worker's, materialmen's, landlords', carriers' or
other similar Liens arising in the ordinary course of business (or deposits
to obtain the release of such Liens) related to obligations not due or, if
due, that are being contested in good faith by appropriate proceedings and
reserves in conformity with GAAP have been provided therefor;
(c) Liens for taxes or assessments or other government charges or
levies not yet due or which are being contested in good faith by
appropriate proceedings and reserves in conformity with GAAP have been
provided therefor;
(d) Liens arising out of judgments or awards against the Borrower or
any of its Subsidiaries, or in connection with surety or appeal bonds in
connection with bonding such judgments or awards, the time for appeal from
which or petition for rehearing of which shall not have expired or which
the Borrower or such Subsidiary shall be prosecuting an appeal or
proceeding for review, and for which it shall have obtained a stay of
execution pending such appeal or proceeding for review; provided that the
aggregate amount of liabilities (including interest and penalties, if any
but excluding any liabilities covered by insurance) of the Borrower and its
Subsidiaries secured by such Liens shall not exceed $5,000,000 at any one
time outstanding;
(e) Liens upon any Property acquired by the Borrower or any of its
Subsidiaries (A) to secure the payment of all or any part of the purchase
price of such Property upon its acquisition, (B) to secure Debt issued,
assumed or guaranteed by the
32
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Borrower or such Subsidiary before, at the time of, or within 90 days after
the acquisition of such Property, which Debt financed all or any part of
the purchase price of such Property, (C) Liens to secure capitalized lease
obligations or (D) to secure commercial letters of credit issued to pay
part or all of the purchase price of such Property; provided that in each
case such Lien applies only to the Property that was so acquired or
purchased, such Debt is incurred in connection with such acquisition or
purchase and such Debt does not exceed the purchase price of such Property;
(f) Liens on Property existing at the time such Property is acquired
by the Borrower or any Subsidiary of the Borrower and not created in
contemplation of such acquisition;
(g) Liens securing Debt described on Schedule 5.18 hereto and other
Indebtedness not to exceed in the aggregate 7% of Consolidated Net Worth at
any time outstanding; and
(h) Any extension, renewal or replacement (or successive extensions,
renewals or replacements) in whole or in part of any Lien referred to in
the foregoing subsections (a) through (g), provided, however, that the
principal amount of Debt secured thereby does not exceed the principal
amount secured at the time of such extension, renewal or replacement, and
that such extension, renewal or replacement is limited to the Property
already subject to the Lien so extended, renewed or replaced.
Nothing contained in subsections (a) through (h) of this Section 6.13 shall be
deemed to permit a pledge of the stock (or other equity interests) of the
Borrower or any of its Subsidiaries.
Section 6.14. Debt. The Borrower will not, and will not permit any of its
----
Subsidiaries to, contract, assume or suffer to exist any Debt, except:
(a) Debt under this Agreement;
(b) Existing Debt listed on Schedule 5.18 and other Debt provided
that at the time such other Debt is incurred and after giving effect to the
incurrence of such other Debt (i) the Borrower is in pro forma compliance
with Section 6.17 hereof and (ii) the Debt of Subsidiaries of the Borrower
(excluding Debt owing to the Borrower or other Subsidiaries of the
Borrower) does not exceed 45% of Consolidated Net Worth.
Section 6.15. Advances, Acquisitions, Investments and Loans. The Borrower
---------------------------------------------
will not, and will not permit any of its Subsidiaries to, lend money or credit
or make advances to any Person, or purchase or acquire any stock of any class
of, or any partnership, joint venture or other equity interest in or obligations
of, or make any capital contribution to, any Person, or purchase or own a
futures contract or otherwise become liable for the purchase or sale of currency
or other commodities at a future date in the nature of a futures contract,
except:
33
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(a) investments in Cash Equivalents;
(b) receivables owing to the Borrower or its Subsidiaries created or
acquired in the ordinary course of business and payable on customary trade
terms of the Borrower or such Subsidiary;
(c) investments (including debt obligations) received in connection
with the bankruptcy or reorganization of suppliers and customers and in
settlement of delinquent obligations of, and other disputes with, customers
and suppliers arising in the ordinary course of business;
(d) advances, loans and investments in existence on the Effective
Date and all such advances, loans and investments by the Borrower or any of
its Subsidiaries in existence on March 31, 1999 and all advances, loans and
investments by the Borrower or any of its Subsidiaries between March 31,
1999 and the Effective Date which had an original amount in excess of
$10,000,000, in each case are reflected on Schedule 6.15 hereto;
(e) deposits made in the ordinary course of business consistent with
past practices to secure the performance of leases;
(f) financing provided by the Borrower and its Subsidiaries to their
customers in the ordinary course of business;
(g) intercompany loans, contributions to capital and advances to any
of its Subsidiaries and any Subsidiaries of the Borrower may make
intercompany loans, contributions to capital and advances to the Borrower;
(h) loans and advances by the Borrower and its Subsidiaries to
directors, officers and employees of the Borrower and its Subsidiaries for
moving and travel expenses and other similar expenses, in each case
incurred in the ordinary course of business, in an aggregate outstanding
principal amount not to exceed $1,500,000 at any time;
(i) purchases or acquisitions of stock or partnership interests,
joint venture interests or other equity interests in any Person who after
such purchase or other acquisition becomes a Subsidiary; and
(j) other purchases, advances, loans and investments with respect to
Persons who are not (or as a result of such investment do not become) a
Subsidiary not to exceed, in the aggregate, twelve and one-half percent
(12.5%) of the Consolidated Net Worth at any time outstanding.
34
<PAGE>
Section 6.16. Dividends and Other Shareholder Distributions. The Borrower
---------------------------------------------
shall not during the occurrence and continuation of any Default or Event of
Default:
(a) declare or pay any dividends or make any distribution of any kind
on its outstanding capital stock, or set aside any sum for any such
purpose; or
(b) purchase, redeem, retire or otherwise acquire, directly or
indirectly, or make any sinking fund payments for, any shares of any class
of stock of the Borrower or any Subsidiary of the Borrower now or hereafter
outstanding or set apart any sum for any such purpose.
Section 6.17. Leverage. The Borrower will at all times maintain a
--------
Consolidated Leverage Ratio of not more than .60 to 1.
Section 6.18. Interest Coverage Ratio. The Borrower will not permit at any
-----------------------
time the Consolidated Interest Ratio to be less than 3.5 to 1, such ratio to be
calculated for the current fiscal quarter and previous three fiscal quarters
combined.
Section 6.19. Transactions with Affiliates. Except as otherwise expressly
----------------------------
permitted by the terms of this Agreement, the Borrower will not, and will not
permit any of its Subsidiaries to, enter into or be a party to any material
transaction or arrangement with any Affiliate of the Borrower or such Subsidiary
which is not itself a Subsidiary, including without limitation, the purchase
from, sale to or exchange of Property with, any merger or consolidation with or
into, or the rendering of any service by or for, any such Affiliate, except (i)
in the ordinary course of and pursuant to the reasonable requirements of the
Borrower's or such Subsidiary's business and upon fair and reasonable terms no
less favorable to the Borrower or such Subsidiary than would obtain in a
comparable arm's-length transaction with a Person other than an Affiliate and
(ii) transactions and arrangements permitted under the terms of Section 6.11 or
6.15 provided the Board of Directors of the Borrower have determined that such
transaction or arrangement is in the best interest of the Borrower.
Section 6.20. Compliance with Laws. Without limiting any of the other
--------------------
covenants of the Borrower in this Section 6, the Borrower will, and will cause
its Subsidiaries to, conduct their business, and otherwise be, in compliance
with all applicable laws, regulations, ordinances and orders of any governmental
or judicial authorities; provided, however, that this Section 6.20 shall not
require the Borrower or any of its Subsidiaries to comply with any such law,
regulation, ordinance or order if (x) it shall be contesting such law,
regulation, ordinance or order in good faith by appropriate proceedings and
reserves in conformity with GAAP have been provided therefor, or (y) the failure
to comply therewith could not, in the aggregate, have a Material Adverse Effect.
Section 6.21. Take or Pay Contracts. The Borrower will not, and will not
---------------------
permit any of its Subsidiaries to, enter into or be a party to any arrangement
for the purchase of materials, supplies, other property or services if such
arrangement by its express terms requires that
35
<PAGE>
payment be made by the Borrower or such Subsidiary regardless of whether such
materials, supplies, other property or services are delivered or furnished to
it.
Section 6.22. Inconsistent Agreements. The Borrower will not enter into
-----------------------
any Contractual Obligation if compliance by the Borrower with the terms and
provisions thereof, consummation of the transactions contemplated therein, or
application or operation of any term, covenant, condition or other provision
thereof would (i) result in a Default or Event of Default or (ii) violate any
provision of the Articles of Incorporation or By-Laws of the Borrower or any of
its Subsidiaries.
SECTION 7. EVENTS OF DEFAULT AND REMEDIES.
Section 7.1. Events of Default. Any one or more of the following shall
-----------------
constitute an Event of Default:
(a) default (x) in the payment when due of the principal amount of
any Loan or (y) for a period of three (3) days in the payment when due of
any other Obligation not mentioned in clause (x);
(b) default by the Borrower, or any of its Subsidiaries in the
observance or performance of any covenant set forth in Sections 6.10, 6.11,
and 6.13-6.22;
(c) default by the Borrower or any Subsidiary in the observance or
performance of any provision hereof not mentioned in (a) or (b) above,
which is not remedied within thirty (30) days after notice thereof to the
Borrower by the Agent;
(d) any representation or warranty made herein by the Borrower or any
Subsidiary, or in any statement or certificate furnished pursuant hereto,
proves untrue in any material respect as of the date of the issuance or
making, or deemed making or issuance, thereof;
(e) (x) default occurs in the payment when due of Indebtedness in an
aggregate principal amount of $5,000,000 or (y) a default or other
circumstance occurs under any Contractual Obligation under which any
Indebtedness in an aggregate principal amount of $5,000,000 is issued or
created and such default or other circumstance continues for a period of
time sufficient to permit the holder or beneficiary of such Indebtedness,
or a trustee therefor, to cause the acceleration of the maturity of any
such Indebtedness or any mandatory unscheduled prepayment, purchase, or
other early funding thereof;
(f) the Borrower or any Subsidiary owning or holding in the aggregate
more than five percent (5%) of the consolidated assets of the Borrower and
its Subsidiaries (i) does not pay, or admits its inability to pay, its
debts generally as they become due, (ii) makes an assignment for the
benefit of creditors, (iii) applies for, seeks, consents to, or
36
<PAGE>
acquiesces in, the appointment of a receiver, custodian, trustee, examiner,
liquidator or similar official for it or any substantial part of its
Property, (iv) institutes any proceeding seeking to have entered against it
an order for relief under the United States Bankruptcy Code or any
comparable law, to adjudicate it insolvent, or seeking dissolution, winding
up, liquidation, reorganization, arrangement, adjustment or composition of
it or its debts under any law relating to bankruptcy, insolvency or
reorganization or relief of debtors or fails to file an answer or other
pleading denying the material allegations of any such proceeding filed
against it, (v) takes any corporate action in furtherance of any matter
described in clauses (i)-(iv) above, or (vi) fails to contest in good faith
any appointment or proceeding described in Section 7.1(g);
(g) a custodian, receiver, trustee, examiner, liquidator or similar
official is appointed for the Borrower or any Subsidiary thereof owning or
holding in the aggregate more than five percent (5%) of the consolidated
assets of the Borrower and its Subsidiaries or any substantial part of any
of their respective Property, or a proceeding described in Section
7.1(f)(iv) is instituted against the Borrower or any Subsidiary of the
Borrower, and such appointment continues undischarged or such proceeding
continues undismissed or unstayed for a period of sixty (60) days;
(h) the Borrower or any Subsidiary of the Borrower fails within
thirty (30) days to pay, bond or otherwise discharge any judgment or order
for the payment of money in excess of, in the aggregate, $5,000,000, which
is not stayed on appeal or otherwise being appropriately contested in good
faith in a manner that stays execution;
(i) any member of the Controlled Group fails to pay when due an
amount or amounts aggregating in excess of $5,000,000, it is liable to pay
to the PBGC or to a Plan under Title IV of ERISA; or notice of intent to
terminate a Plan or Plans having aggregate Unfunded Vested Liabilities in
excess of $5,000,000 (collectively, a "Material Plan") is filed under Title
IV of ERISA by a member of the Controlled Group, any plan administrator or
any combination of the foregoing; or the PBGC institutes proceedings under
Title IV of ERISA to terminate or to cause a trustee to be appointed to
administer any Material Plan or a proceeding is instituted by a fiduciary
of any Material Plan against any member of the Controlled Group to enforce
Section 515 or 4219(c)(5) of ERISA and such proceeding is not dismissed
within thirty (30) days thereafter; or a condition exists by reason of
which the PBGC would be entitled to obtain a decree adjudicating that any
Material Plan must be terminated;
(j) an event occurs which has a Material Adverse Effect;
(k) (x) the Borrower, any Person acting on behalf of the Borrower, or
any Governmental Authority challenges the validity of any Credit Document
or the Borrower's obligations thereunder or (y) any Credit Document ceases
to be in full force and effect or ceases to give the Agent and Lenders the
material Liens, rights, and powers purported to be granted in their favor
thereby; or
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(l) a Change of Control Event occurs.
Section 7.2. Non-Bankruptcy Defaults. When any Event of Default other than
-----------------------
those described in subsections (f) or (g) of Section 7.1 has occurred and is
continuing, the Agent shall, by notice to the Borrower: (a) if so directed by
the Required Lenders, terminate the remaining Commitments and all other
obligations of the Lenders hereunder on the date stated in such notice (which
may be the date thereof) and (b) if so directed by the Required Lenders, declare
the principal of and the accrued interest on all outstanding Loans to be
forthwith due and payable and thereupon all outstanding Loans, including both
principal and interest thereon, shall be and become immediately due and payable
together with all other amounts payable under the Credit Documents without
further demand, presentment, protest or notice of any kind. The Agent, after
giving notice to the Borrower pursuant to Section 7.1(c) or this Section 7.2,
shall also promptly send a copy of such notice to the other Lenders, but the
failure to do so shall not impair or annul the effect of such notice.
Section 7.3. Bankruptcy Defaults. When any Event of Default described in
-------------------
subsections (f) or (g) of Section 7.1 has occurred and is continuing, then all
outstanding Loans shall immediately become due and payable together with all
other amounts payable under the Credit Documents without presentment, demand,
protest or notice of any kind, and all obligations of the Lenders to extend
further credit pursuant to any of the terms hereof shall immediately terminate.
Section 7.4. Notice of Default. The Agent shall give notice to the
-----------------
Borrower under Section 7.1(c) promptly upon being requested to do so by any
Lender and shall thereupon notify all the Lenders thereof.
Section 7.5. Expenses. The Borrower agrees to pay to the Agent and each
--------
Lender all expenses incurred or paid by the Agent, such Lender or any such
holder, including reasonable attorneys' fees (including, without limitation, the
reasonable allocable cost of inside counsel) and court costs, in connection with
any Default or Event of Default by the Borrower hereunder or in connection with
the enforcement of any of the Credit Documents.
SECTION 8. CHANGE IN CIRCUMSTANCES.
Section 8.1. Change of Law. Notwithstanding any other provisions of this
-------------
Agreement, if at any time any change in applicable law or regulation or in the
interpretation thereof makes it unlawful for any Lender to make or continue to
maintain Eurocurrency Loans in U.S. Dollars or in an Optional Currency or to
give effect to its obligations as contemplated hereby, such Lender shall
promptly give notice thereof to the Agent and the Borrower and such Lender's
obligations to make or maintain Eurocurrency Loans in such currency under this
Agreement shall terminate until it is no longer unlawful for such Lender to make
or maintain such Loans in such currency. The Borrower shall prepay on demand
the outstanding principal amount of any such affected Eurocurrency Loans,
together with all interest accrued thereon and all other amounts then due and
payable to such Lender under this Agreement; provided, however, subject to all
of the terms and conditions of this Agreement, the Borrower may then elect to
borrow the principal amount
38
<PAGE>
of the affected Eurocurrency Loans from such Lender by means of Eurocurrency
Loans of another currency or Base Rate Loans from such Lender and such Loan
shall not be made ratably by the Lenders but only from such affected Lender.
Section 8.2. Unavailability of Deposits or Inability to Ascertain LIBOR.
----------------------------------------------------------
If on or before to the first day of any Interest Period for any Borrowing of
Eurocurrency Loans the Agent determines (after consultation with other Lenders)
that, due to changes in circumstances since the date hereof, adequate and fair
means do not exist for determining LIBOR for the applicable currency of such
Eurocurrency Loan or such rate will not accurately reflect the cost to the
Required Lenders of funding Eurocurrency Loans in such currency for such
Interest Period, the Agent shall give notice of such determination to the
Borrower and the Lenders, whereupon until the Agent notifies the Borrower and
Lenders that the circumstances giving rise to such suspension no longer exist,
the obligations of the Lenders to make Eurocurrency Loans in such currency shall
be suspended.
Section 8.3. Increased Cost and Reduced Return. (a) If the adoption of or
---------------------------------
any change in any applicable law, rule or regulation after the Effective Date,
or any change in the interpretation or administration thereof after the
Effective Date by any Governmental Authority, central bank or comparable agency
charged with the interpretation or administration thereof, or compliance by any
Lender (or its Lending Office), with any request or directive (whether or not
having the force of law) of any such Authority, central bank or comparable
agency made after the Effective Date:
(i) subjects any Lender (or its Lending Office) to any tax, duty or
other charge related to any Eurocurrency Loan, or its obligation to advance
or maintain any Eurocurrency Loans, or shall change the basis of taxation
of payments to any Lender (or its Lending Office) of the principal of or
interest on any of its Eurocurrency Loans or any other amounts due under
this Agreement related to any of its Eurocurrency Loans or its obligation
to make Eurocurrency Loans in any currency (except for changes in the rate
of tax on the net income or net profits of, or franchise taxes imposed on
such Lender or its Lending Office imposed by the jurisdiction in which such
Lender's principal executive office or Lending Office is located or any
taxes subject to payment or reimbursement under Section 3.3); or
(ii) imposes, modifies or deems applicable any reserve, special
deposit or similar requirement (including, without limitation, any such
requirement imposed by the Board of Governors of the Federal Reserve
System, but excluding for any Eurocurrency Loan any such requirement
included in an applicable Eurocurrency Reserve Percentage) against assets
of, deposits with or for the account of, or credit extended by, any Lender
(or its Lending Office) or imposes on any Lender (or its Lending Office) or
on the interbank market any other condition affecting any of its
Eurocurrency Loans or its obligation to advance or maintain any
Eurocurrency Loans,
39
<PAGE>
and the result of any of the foregoing is to increase the cost to such Lender
(or its Lending Office) of advancing or maintaining any Eurocurrency Loan or its
commitment hereunder or to reduce the amount of any sum received or receivable
by such Lender (or its Lending Office) in connection therewith under this
Agreement, by an amount deemed by such Lender to be material, then, within
fifteen (15) days after demand by such Lender (with a copy to the Agent), the
Borrower shall be obligated to pay to such Lender such additional amount or
amounts as will compensate such Lender for such increased cost or reduction.
(b) If the Agent or any Lender shall have determined that the adoption of
any applicable law, rule or regulation after the Effective Date regarding
capital adequacy, or any change after the Effective Date therein, or any change
in the interpretation or administration thereof after the Effective Date by any
Governmental Authority, central bank or comparable agency charged with the
interpretation or administration thereof, or compliance by the Agent or any
Lender (or its Lending Office) with any request or directive regarding capital
adequacy (whether or not having the force of law) of any such Authority, central
bank or comparable agency made after the Effective Date, has or would have the
effect of reducing the rate of return on the Agent's or such Lender's capital,
or on the capital of any corporation controlling the Agent or such Lender, as a
consequence of its obligations hereunder to a level below that which the Agent
or such Lender could have achieved but for such adoption, change or compliance
(taking into consideration the Agent's or such Lender's policies with respect to
capital adequacy) by an amount deemed by the Agent or such Lender to be
material, then from time to time, within fifteen (15) days after demand by the
Agent or such Lender (with a copy to the Agent), the Borrower shall be obligated
to pay to the Agent or such Lender such additional amount or amounts as will
compensate the Agent or such Lender for such reduction.
(c) The Agent and each Lender that determines to seek compensation under
this Section 8.3 shall notify the Borrower, and (in the case of a Lender other
than the Agent), the Agent of the circumstances that entitle the Agent or Lender
to such compensation pursuant to this Section 8.3 and will designate a different
Lending Office if such designation will avoid the need for, or reduce the amount
of, such compensation and will not, in the judgment of the Agent or such Lender,
be otherwise disadvantageous to it. A certificate of the Agent or any Lender
claiming compensation under this Section 8.3 and setting forth the additional
amount or amounts to be paid to it hereunder shall be conclusive in the absence
of manifest error. In determining such amount, such Lender may use any
reasonable averaging and attribution methods.
Section 8.4. Lending Offices. The Agent and each Lender may, at its
---------------
option, elect to make its Loans hereunder at the branch, office or affiliate
specified on the appropriate signature page hereof (each a "Lending Office") for
each type of Loan available hereunder or at such other of its branches, offices
or affiliates as it may from time to time elect and designate in a written
notice to the Borrower and the Agent.
Section 8.5. Discretion of Lender as to Manner of Funding. Notwithstanding
--------------------------------------------
any other provision of this Agreement, each Lender shall be entitled to fund and
maintain its funding of all or any part of its Loans in any manner it sees fit,
it being understood, however, that for the
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purposes of this Agreement all determinations hereunder shall be made as if each
Lender had actually funded and maintained each Eurocurrency Loan through the
purchase of deposits in the eurocurrency interbank market of the applicable
currency having a maturity corresponding to such Loan's Interest Period and
bearing an interest rate equal to LIBOR for such Interest Period.
Section 8.6. Substitution of Lender. If (a) any Lender has demanded
----------------------
compensation or given notice of its intention to demand compensation under
Section 8.3, (b) any Lender has delivered a notice under Section 8.1, or (c) the
Borrower is required to pay any additional amount to any Lender under Section
3.3, the Borrower shall have the right, so long as no Default or Event of
Default shall have occurred and be continuing, with the assistance of the Agent,
to seek a substitute lender or lenders reasonably satisfactory to the Agent
(which may be one or more of the Lenders) to replace such Lender under this
Agreement. If the Borrower has elected to exercise its rights under this
Section 8.6, the Lender to be so replaced shall cooperate with the Borrower and
substitute lender to accomplish such substitution on the terms of Section 10.10
or 10.11, as applicable, provided that all such Lender's Commitments are
replaced.
SECTION 9. THE AGENT.
Section 9.1. Appointment and Authorization. Each Lender hereby irrevocably
-----------------------------
(subject to Section 9.9) appoints, designates and authorizes the Agent to take
such action on its behalf under the provisions of this Agreement and each other
Credit Document and to exercise such powers and perform such duties as are
expressly delegated to it by the terms of this Agreement or any other Credit
Document, together with such powers as are reasonably incidental thereto.
Notwithstanding any provision to the contrary contained elsewhere in this
Agreement or in any other Credit Document, the Agent shall not have any duties
or responsibilities, except those expressly set forth herein or in the other
Credit Documents, nor shall the Agent have or be deemed to have any fiduciary
relationship with any Lender, and no implied covenants, functions,
responsibilities, duties, obligations or liabilities shall be read into this
Agreement or any other Credit Document or otherwise exist against the Agent.
Section 9.2. Delegation of Duties. The Agent may execute any of its duties
--------------------
under this Agreement or any other Credit Document by or through agents,
employees or attorneys-in-fact and shall be entitled to advice of counsel
concerning all matters pertaining to such duties. The Agent shall not be
responsible for the negligence or misconduct of any agent or attorney-in-fact
selected with reasonable care.
Section 9.3. Liability of Agents. None of the Agent-Related Persons shall
-------------------
(a) be liable for any action taken or omitted to be taken by any of them under
or in connection with this Agreement or any other Credit Document or the
transactions contemplated hereby (except for its own gross negligence or willful
misconduct), or (b) be responsible in any manner to any of the Lenders for any
recital, statement, representation or warranty made by the Borrower or any
Affiliate of the Borrower, or any officer thereof, contained in this Agreement
or in any other Credit Document, or in any certificate, report, statement or
other document referred to or provided for in, or received by the Agent under or
in connection with, this Agreement or any
41
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other Credit Document, or the validity, effectiveness, genuineness,
enforceability or sufficiency of this Agreement or any other Credit Document, or
for any failure of the Borrower or any other party to any Credit Document to
perform its obligations hereunder or thereunder. No Agent-Related Person shall
be under any obligation to any Lender to ascertain or to inquire as to the
observance or performance of any of the agreements contained in, or conditions
of, this Agreement or any other Credit Document, or to inspect the properties,
books or records of the Borrower.
Section 9.4. Reliance by Agent. The Agent shall be entitled to rely, and
-----------------
shall be fully protected in relying, upon any writing, resolution, notice,
consent, certificate, affidavit, letter, telegram, facsimile, telex or telephone
message, statement or other document or conversation believed by it to be
genuine and correct and to have been signed, sent or made by the proper Person
or Persons, and upon advice and statements of legal counsel (including counsel
to the Borrower), independent accountants and other experts selected by the
Agent. The Agent shall be fully justified in failing or refusing to take any
action under this Agreement or any other Credit Document unless it shall first
receive such advice or concurrence of the Required Lenders as it deems
appropriate and, if it so requests, it shall first be indemnified to its
satisfaction by the Lenders against any and all liability and expense which may
be incurred by it by reason of taking or continuing to take any such action.
The Agent shall in all cases be fully protected in acting, or in refraining from
acting, under this Agreement or any other Credit Document in accordance with a
request or consent of the Required Lenders and such request and any action taken
or failure to act pursuant thereto shall be binding upon all of the Lenders.
For purposes of determining compliance with the conditions specified in
Section 4.1, each Lender that has executed this Agreement shall be deemed to
have consented to, approved or accepted or to be satisfied with, each document
or other matter either sent by the Agent to such Lender for consent, approval,
acceptance or satisfaction, or required thereunder to be consented to or
approved by or acceptable or satisfactory to the Lender.
Section 9.5. Notice of Default. The Agent shall not be deemed to have
-----------------
knowledge or notice of the occurrence of any Default or Event of Default, except
with respect to defaults in the payment of principal, interest and fees required
to be paid to the Agent for the account of the Lenders, unless the Agent shall
have received written notice from a Lender or the Borrower referring to this
Agreement, describing such Default or Event of Default and stating that such
notice is a "notice of default". The Agent will notify the Lenders of its
receipt of any such notice. The Agent shall take such action with respect to
such Default or Event of Default as may be requested by the Required Lenders in
accordance with Section 7; provided, however, that unless and until the Agent
-------- -------
has received any such request, the Agent may (but shall not be obligated to)
take such action, or refrain from taking such action, with respect to such
Default or Event of Default as it shall deem advisable or in the best interest
of the Lenders.
Section 9.6. Credit Decision. Each Lender acknowledges that none of the
---------------
Agent-Related Persons has made any representation or warranty to it, and that no
act by the Agent hereinafter taken, including any review of the affairs of the
Borrower, shall be deemed to
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constitute any representation or warranty by any Agent-Related Person to any
Lender. Each Lender represents to the Agent that it has, independently and
without reliance upon any Agent-Related Person and based on such documents and
information as it has deemed appropriate, made its own appraisal of and
investigation into the business, prospects, operations, property, financial and
other condition and creditworthiness of the Borrower, and all applicable bank
regulatory laws relating to the transactions contemplated hereby, and made its
own decision to enter into this Agreement and to extend credit to the Borrower
hereunder. Each Lender also represents that it will, independently and without
reliance upon any Agent-Related Person and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit analysis, appraisals and decisions in taking or not taking action under
this Agreement and the other Credit Documents, and to make such investigations
as it deems necessary to inform itself as to the business, prospects,
operations, property, financial and other condition and creditworthiness of the
Borrower. Except for notices, reports and other documents expressly herein
required to be furnished to the Lenders by the Agent, the Agent shall not have
any duty or responsibility to provide any Lender with any credit or other
information concerning the business, prospects, operations, property, financial
and other condition or creditworthiness of the Borrower which may come into the
possession of any of the Agent-Related Persons.
Section 9.7. Indemnification. Whether or not the transactions contemplated
---------------
hereby are consummated, the Lenders shall indemnify upon demand the Agent-
Related Persons (to the extent not reimbursed by or on behalf of the Borrower
and without limiting the obligation of the Borrower to do so), pro rata, from
and against any and all Indemnified Liabilities; provided, however, that no
-------- -------
Lender shall be liable for the payment to the Agent-Related Persons of any
portion of such Indemnified Liabilities resulting solely from such Person's
gross negligence or willful misconduct. Without limitation of the foregoing,
each Lender shall reimburse the Agent upon demand for its ratable share of any
costs or out-of-pocket expenses (including Attorney Costs) incurred by the Agent
in connection with the preparation, execution, delivery, administration,
modification, amendment or enforcement (whether through negotiations, legal
proceedings or otherwise) of, or legal advice in respect of rights or
responsibilities under, this Agreement, any other Credit Document, or any
document contemplated by or referred to herein, to the extent that the Agent is
not reimbursed for such expenses by or on behalf of the Borrower. The
undertaking in this Section shall survive the payment of all Obligations
hereunder and the resignation or replacement of the Agent.
Section 9.8. Agent in Individual Capacity. BofA and its Affiliates may
----------------------------
make loans to, issue letters of credit for the account of, accept deposits from,
acquire equity interests in and generally engage in any kind of banking, trust,
financial advisory, underwriting or other business with the Borrower and its
respective Affiliates as though BofA were not the Agent hereunder and without
notice to or consent of the Lenders. The Lenders acknowledge that, pursuant to
such activities, BofA or its Affiliates may receive information regarding the
Borrower or its Affiliates (including information that may be subject to
confidentiality obligations in favor of the Borrower or such Affiliate) and
acknowledge that the Agent shall be under no obligation to provide such
information to them. With respect to its Loans, BofA shall have the same rights
and powers under this Agreement as any other Lender and may exercise the same as
though it
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were not the Agent, and the terms "Lender" and "Lenders" include BofA in its
individual capacity.
Section 9.9. Successor Agent. The Agent may, and at the request of the
---------------
Required Lenders shall, resign as Agent upon 30 days' notice to the Lenders. If
the Agent resigns under this Agreement, the Required Lenders shall appoint from
among the Lenders a successor agent for the Lenders which successor agent shall
be approved by the Borrower. If no successor agent is appointed prior to the
effective date of the resignation of the Agent, the Agent may appoint, after
consulting with the Lenders and the Borrower, a successor agent from among the
Lenders. Upon the acceptance of its appointment as successor agent hereunder,
such successor agent shall succeed to all the rights, powers and duties of the
retiring Agent and the term "Agent" shall mean such successor agent and the
retiring Agent's appointment, powers and duties as Agent shall be terminated.
After any retiring Agent's resignation hereunder as Agent, the provisions of
this Section 9 and Sections 10.4 and 10.5 shall inure to its benefit as to any
actions taken or omitted to be taken by it while it was Agent under this
Agreement. If no successor agent has accepted appointment as Agent by the date
which is 30 days following a retiring Agent's notice of resignation, the
retiring Agent's resignation shall nevertheless thereupon become effective and
the Lenders shall perform all of the duties of the Agent hereunder until such
time, if any, as the Required Lenders appoint a successor agent as provided for
above.
SECTION 10. MISCELLANEOUS.
Section 10.1. No Waiver of Rights. No delay or failure on the part of the
-------------------
Agent or any Lender in the exercise of any power or right under any Credit
Document shall operate as a waiver thereof or as an acquiescence in any default,
nor shall any single or partial exercise thereof preclude any other or further
exercise of any other power or right. The rights and remedies under the Credit
Documents of the Agent, the Lenders are cumulative to, and not exclusive of, any
rights or remedies any of them would otherwise have.
Section 10.2. Non-Business Day. If any payment of principal or interest on
----------------
any Loan or of any other Obligation shall fall due on a day which is not a
Business Day, interest or fees (as applicable) at the rate, if any, such Loan or
other Obligation bears for the period prior to maturity shall continue to accrue
on such Obligation from the stated due date thereof to and including the next
succeeding Business Day, on which the same shall be payable.
Section 10.3. Documentary Taxes. The Borrower agrees that it will pay,
-----------------
within 15 days of demand by the Agent, any documentary, stamp or similar taxes
payable in respect to any Credit Document, including interest and penalties, in
the event any such taxes are assessed.
Section 10.4. Survival of Representations. All representations and
---------------------------
warranties made herein or in certificates given pursuant hereto shall survive
the execution and delivery of this Agreement and the other Credit Documents, and
shall continue in full force and effect with
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<PAGE>
respect to the date as of which they were made as long as any Loan is
outstanding or Commitment is available hereunder.
Section 10.5. Survival of Indemnities. All indemnities and all other
-----------------------
provisions relative to reimbursement to the Lenders of amounts sufficient to
protect the yield of the Lenders with respect to the Loans, including, but not
limited to, Section 2.11, Section 8.3 and Section 10.14 hereof, shall survive
the termination of this Agreement and the other Credit Documents and the payment
of the Loans and all other Obligations.
Section 10.6. Sharing of Set-off. Each Lender agrees with each other Lender
------------------
a party hereto that if such Lender receives and retains any payment, whether by
set-off or application of deposit balances or otherwise ("Set-off"), on any of
the Loans or other Obligations in excess of its ratable share of payments on all
such Loans or other Obligations then owed to the Lenders under this Agreement
(other than payments pursuant to Section 2.11, 3.3, 8.3 or 10.14), then such
Lender shall purchase for cash at face value, but without recourse, ratably from
each of the other Lenders such amount of the Loans or other Obligations, or
participations therein, held by each such other Lenders (or interest therein) as
shall be necessary to cause such Lender to share such excess payment ratably
with all the other Lenders; provided, however, that if any such purchase is made
by any Lender, and if such excess payment or part thereof is thereafter
recovered from such purchasing Lender, the related purchases from the other
Lenders shall be rescinded ratably and the purchase price restored as to the
portion of such excess payment so recovered, but without interest.
Section 10.7. Notices. Except as otherwise specified herein, all notices
-------
under the Credit Documents shall be in writing (including cable, telecopy or
telex) and shall be given to a party hereunder at its address, facsimile number
set forth on Schedule 10.7 or such other address or facsimile number as such
party may hereafter specify by notice to the Agent and the Borrower, given by
courier, by United States certified or registered mail, by facsimile or by other
telecommunication device capable of creating a written record of such notice and
its receipt.
Each such notice, request or other communication shall be effective (i) if
given by facsimile, when such facsimile is transmitted to the facsimile number
specified in Schedule 10.7 or pursuant to Section 10.10 or 10.11 and a
confirmation of receipt of such facsimile has been received by the sender, (ii)
if given by courier, when delivered, (iii) if given by mail, five (5) days after
such communication is deposited in the mail, registered with return receipt
requested, addressed as aforesaid or (iv) if given by any other means, when
delivered at the addresses specified in Schedule 10.7, or pursuant to Section
10.10 or 10.11; provided that any notice given pursuant to Section 2 shall be
effective only upon receipt.
Any agreement of the Agent and the Lenders herein to receive certain
notices by telephone or facsimile is solely for the convenience and at the
request of the Borrower. The Agent and the Lenders shall be entitled to rely on
the authority of any Person purporting to be a Person authorized by the Borrower
to give such notice and the Agent and the Lenders shall not have any liability
to the Borrower or other Person on account of any action taken or not taken by
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<PAGE>
the Agent or the Lenders in reliance upon such telephonic or facsimile notice.
The obligation of the Borrower to repay the Loans shall not be affected in any
way or to any extent by any failure by the Agent and the Lenders to receive
written confirmation of any telephonic or facsimile notice or the receipt by the
Agent and the Lenders of a confirmation which is at variance with the terms
understood by the Agent and the Lenders to be contained in the telephonic or
facsimile notice.
Section 10.8. Counterparts. This Agreement may be executed in any number
------------
of counterpart signature pages, and by the different parties on different
counterpart signature pages, each of which when executed shall be deemed an
original but all such counterparts taken together shall constitute one and the
same instrument.
Section 10.9. Successors and Assigns. This Agreement shall be binding upon
----------------------
the Borrower and its successors and assigns, and shall inure to the benefit of
each of the Lenders and the benefit of their respective successors and assigns.
The Borrower may not assign any of its rights or obligations under any Credit
Document without the written consent of all of the Lenders.
Section 10.10. Participants. Each Lender may assign or grant participations
------------
in its rights under the Credit Documents in whole or in part to one or more
other Persons; provided that (i) no such assignment or participation shall
relieve any Lender of any of its obligations under this Agreement, (ii) the
Borrower and the Agent shall continue to deal solely and directly with such
Lender in connection with its rights and obligations under the Credit Documents,
and (iii) the Borrower and the Agent shall have no obligation or responsibility
to such participant or assignee. Any agreement pursuant to which a participation
in or assignment of Obligations or rights thereunder is granted (other than an
assignment complying with Section 10.11) shall provide that the granting Lender
retains the sole right and responsibility to enforce the obligations of the
Borrower under this Agreement and the other Credit Documents including, without
limitation, the right to approve any amendment, modification or waiver of any
provision of the Credit Documents, except that such agreement may provide that
such Lender will not agree to any modification, amendment or waiver of the
Credit Documents that would reduce the principal amount of or interest owing on,
or extend the final maturity date of, any Obligation in which such participant
or assignee has an interest without the consent of such participant or assignee.
Any party to which such a participation or assignment has been granted shall
have the benefits of Sections 2.11 and 8.3, but not in excess of the amounts to
which the participating Lender would have been entitled had no such
participation been made.
Section 10.11. Assignments of Commitments by Lenders. Each Lender shall
-------------------------------------
have the right at any time, with the consent of the Borrower (except after the
occurrence and continuation of an Event of Default) and the Agent (which
consents shall not be unreasonably withheld), to sell, assign, transfer or
negotiate all or any part of its Commitments and related Obligations to an
Eligible Assignee; provided that such assignment shall be of a single fixed
percentage (and not by its terms a varying percentage) of the assigning Lender's
Commitment, Loans and related Obligations; and (ii) any assignee Lender must
have a Commitment of at least $5,000,000 and an
46
<PAGE>
assignor Lender must either assign its entire Commitment or retain a Commitment
of at least $5,000,000. Any such assignee shall become a Lender for all purposes
hereunder to the extent of the Commitment(s) it assumes, and the assigning
Lender shall be released from its obligations, and will have released its
rights, under the Credit Documents to the extent of such assignment upon the
Agent's receipt of a completed Assignment Agreement reflecting such assignment
and a $3,500 recordation fee. Any such assignee Lender must comply with Section
3.3(b) as of the time such assignment is recorded with the Agent.
Notwithstanding the foregoing provisions of this Section 10.11 or any other
provision of this Agreement, any Lender may at any time assign all or any
portion of its Loans to any federal reserve bank or any other central bank (but
no such assignment shall release any Lender from any of its obligations
hereunder).
Section 10.12. Amendments. Any provision of the Credit Documents may be
----------
amended or waived if, but only if, such amendment or waiver is in writing and is
signed by (a) the Borrower, (b) the Required Lenders, and (c) the Agent;
provided that:
(i) no amendment or waiver shall (A) increase any Commitment of any
Lender without the consent of such Lender or (B) reduce the amount of or
postpone the date for any scheduled payment of any principal of or interest
on any Loan or Obligation or of any fee payable hereunder without the
consent of each Lender owed such Obligation;
(ii) no amendment or waiver shall, unless signed by each Lender,
change the provisions of this Section 10.12, Section 10.6 or the definition
of Required Lenders or affect the number of Lenders required to take any
action under any other provision of the Credit Documents; and
(iii) no amendment shall affect the rights or duties of the Agent
under this Agreement or any Credit Document without the consent of the
Agent.
The Fee Letter may be amended, or rights or privileges thereunder waived, in a
writing executed by the parties thereto.
Section 10.13. Headings. Section headings used in this Agreement are for
--------
reference only and shall not affect the construction of this Agreement.
Section 10.14. Legal Fees, Other Costs and Indemnification. The Borrower
-------------------------------------------
agrees to pay the reasonable fees and disbursements of legal counsel to the
Agent in connection with the preparation and execution of the Credit Documents
(including, without limitation, the reasonably allocable cost of its inside
counsel), and any amendment, waiver or consent related hereto, whether or not
the transactions contemplated herein are consummated. The Borrower further
agrees to indemnify and hold harmless each Lender, the Agent, and their
respective directors, officers, employees, Affiliates, agents and attorneys-in-
fact (each an "Indemnified Person") from and against all losses, claims,
damages, penalties, judgments, liabilities, and attorneys fees and other
expenses (including, without limitation, all expenses of litigation or
preparation
47
<PAGE>
therefor, whether or not the Indemnified Person is a party thereto) which any of
them may pay or incur arising out of or relating to any Credit Document
(including enforcement thereof) or any of the transactions contemplated thereby
or the direct or indirect application or proposed application of the proceeds of
any Loan, other than those which (i) arise from the gross negligence or willful
misconduct of the party claiming indemnification or (ii) are subject to
reimbursement, indemnity or payment under any other provision of this Agreement
or any of the Credit Documents but, by the terms of such provision, are not
reimbursable, indemnifiable or payable thereunder. The Borrower upon demand by
the Agent or a Lender at any time, shall reimburse the Agent or Lender for any
legal or other expenses incurred in connection with investigating or defending
against any of the foregoing except if the same is directly due to the gross
negligence or willful misconduct of the party to be indemnified.
Section 10.15. Set Off. In addition to any rights now or hereafter granted
-------
under applicable law and not by way of limitation of any such rights, upon the
occurrence and during the continuation of any Event of Default, each Lender is
hereby authorized by the Borrower at any time or from time to time, without
notice to the Borrower or to any other Person, any such notice being hereby
expressly waived, to set off and to appropriate and to apply any and all
deposits (general or special, including, but not limited to, Indebtedness
evidenced by certificates of deposit, whether matured or unmatured, but not
including trust accounts, and in whatever currency denominated) and any other
Indebtedness at any time held or owing by that Lender to or for the credit or
the account of the Borrower whether or not matured, against and on account of
the obligations and liabilities of the Borrower to that Lender under the Credit
Documents, including, but not limited to, all claims of any nature or
description arising out of or connected with the Credit Documents, irrespective
of whether or not (a) that Lender shall have made any demand hereunder or (b)
the principal of or the interest on the Loans and other amounts due hereunder
shall have become due and payable pursuant to Section 7 and although said
obligations and liabilities, or any of them, may be contingent or unmatured.
Section 10.16. Entire Agreement. The Credit Documents constitute the entire
----------------
understanding among the Borrower, the Lenders and the Agent and supersede all
earlier or contemporaneous agreements, whether written or oral, concerning the
subject matter of the Credit Documents.
Section 10.17. Governing Law; Submission to Jurisdiction; Waiver of Jury
---------------------------------------------------------
Trial. THIS AGREEMENT AND THE OTHER CREDIT DOCUMENTS, AND THE RIGHTS AND DUTIES
- -----
OF THE PARTIES THERETO, SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY
THE INTERNAL LAWS OF THE STATE OF ILLINOIS. EACH PARTY TO THIS AGREEMENT HEREBY
SUBMITS TO THE NONEXCLUSIVE JURISDICTION OF THE UNITED STATES DISTRICT COURT FOR
THE NORTHERN DISTRICT OF ILLINOIS AND OF ANY ILLINOIS STATE COURT SITTING IN THE
CITY OF CHICAGO FOR PURPOSES OF ALL LEGAL PROCEEDINGS ARISING OUT OF OR RELATING
TO THIS AGREEMENT, ANY OTHER CREDIT DOCUMENT OR THE TRANSACTIONS CONTEMPLATED
THEREBY. EACH PARTY TO THIS AGREEMENT IRREVOCABLY WAIVES, TO
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<PAGE>
THE FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION IT MAY NOW OR HEREAFTER HAVE
TO THE LAYING OF THE VENUE OF ANY SUCH PROCEEDING BROUGHT IN SUCH A COURT AND
ANY CLAIM THAT ANY SUCH PROCEEDING BROUGHT IN SUCH A COURT HAS BEEN BROUGHT IN
AN INCONVENIENT FORUM. EACH PARTY TO THIS AGREEMENT HEREBY IRREVOCABLY WAIVES
ALL RIGHT TO A TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING
OUT OF OR RELATING TO ANY CREDIT DOCUMENT OR THE TRANSACTIONS CONTEMPLATED
THEREBY.
Section 10.18. Confidentiality. Each Lender agrees it will use its best
---------------
efforts not to disclose without the Borrower's consent (other than to its
employees, auditors, counsel or other professional advisors, to its Affiliates
or to another Lender) any information concerning the Borrower or any of its
Subsidiaries furnished pursuant to this Agreement; provided, that any Lender may
disclose any such information (a) that has become generally available to the
public, (b) if required or appropriate in any report, statement or testimony
submitted to any regulatory body having or claiming to have jurisdiction over
such Lender, (c) if required or appropriate in response to any summons or
subpoena or in connection with any litigation, (d) in order to comply with any
law, order, regulation or ruling applicable to such Lender, and (e) to any
prospective or actual transferee in connection with any contemplated or actual
transfer of any of the Loans or any interest therein by such Lender; provided,
that such actual or prospective transferee executes an agreement with such
Lender containing provisions substantially identical to those contained in this
Section 10.18.
Section 10.19. Severability. Any provision of this Agreement that is
------------
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
Section 10.20. Currency. Each reference in this Agreement to U.S. Dollars
--------
or to an Optional Currency (the "relevant currency") is of the essence. To the
fullest extent permitted by law, but subject to the Borrower's rights under the
EMU Legislation, the obligation of the Borrower in respect of any amount due in
the relevant currency under this Agreement shall, notwithstanding any payment in
any other currency (whether pursuant to a judgment or otherwise), be discharged
only to the extent of the amount in the relevant currency that the Agent may, in
accordance with normal banking procedures, purchase with the sum paid in such
other currency (after any premium and costs of exchange) on the Business Day
immediately following the day on which such party receives such payment. If the
amount in the relevant currency that may be so purchased for any reason falls
short of the amount originally due, the Borrower shall pay such additional
amounts, in the relevant currency, as may be necessary to compensate for the
shortfall. Any obligations of the Borrower not discharged by such payment shall,
to the fullest extent permitted by applicable law, be due as a separate and
independent obligation and, until discharged as provided herein, shall continue
in full force and effect.
49
<PAGE>
Section 10.21. Currency Equivalence. If for the purposes of obtaining
--------------------
judgment in any court it is necessary to convert a sum due from the Borrower on
the Obligations in the currency expressed to be payable herein (the "specified
currency") into another currency, the parties agree that the rate of exchange
used shall be that at which in accordance with normal banking procedures each
Lender could purchase the specified currency with such other currency on the
Business Day preceding that on which final judgment is given. The obligation of
the Borrower in respect of any such sum due to a Lender on the Obligations
shall, notwithstanding any judgment in a currency other than the specified
currency, be discharged only to the extent that on the Business Day following
receipt by such Lender of any sum adjudged to be so due in such other currency,
such Lender may in accordance with normal banking procedures purchase the
specified currency with such other currency. If the amount of the specified
currency so purchased is less than the sum originally due to such Lender in the
specified currency, the Borrower agrees, as a separate obligation and
notwithstanding any such judgment, to indemnify such Lender against such loss,
and if the amount of the specified currency so purchased exceeds the amount
originally due to such Lender in the specified currency, such Lender agrees to
remit such excess to the Borrower.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
50
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered in Chicago, Illinois by their duly authorized
officers as of the day and year first above written.
APTARGROUP, INC.
By: /s/ Stephen J. Hagge
-----------------------------------
Name: Stephen J. Hagge
------------------------------
Title: Executive Vice President and
-----------------------------
CFO, Secretary and Treasurer
S-1
<PAGE>
BANK OF AMERICA NATIONAL
TRUST AND SAVINGS ASSOCIATION,
as Agent and as a Lender
By: /s/ M. H. Claggett
--------------------------------
Name: M. H. CLAGGETT
--------------------------
Title: VICE PRESIDENT
--------------------------
S-2
<PAGE>
SOCIETE GENERALE - CHICAGO BRANCH
By: /s/ Michael O. Lincoln
---------------------------------
Name: Michael O. Lincoln
----------------------------
Title: Director
---------------------------
S-3
<PAGE>
FLEET NATIONAL BANK
By: /s/ H. Frazier Caner
------------------------------
Name: H. Frazier Caner
-------------------------
Title: Vice President
------------------------
S-4
<PAGE>
ABN AMRO BANK N.V.
By: /s/ Bernard J. McGuigan
----------------------------------------
Name: Bernard J. McGuigan
-----------------------------------
Title: Group Vice President and Director
----------------------------------
By: /s/ Thomas Comfort
----------------------------------------
Name: Thomas Comfort
-----------------------------------
Title: Group Vice President
----------------------------------
S-5
<PAGE>
EXHIBIT A
NOTICE OF BORROWING
-------------------
Date: _______,_____
To: Bank of America National Trust and Savings Association as Agent for the
Lenders parties to the Multicurrency Credit Agreement dated as of June 30,
1999 (as extended, renewed, amended or restated from time to time, the
"Credit Agreement") among AptarGroup, Inc., certain Lenders which are
----------------
signatories thereto and Bank of America National Trust and Savings
Association, as Agent
Ladies and Gentlemen:
The undersigned, AptarGroup, Inc. (the "Borrower"), refers to the Credit
--------
Agreement, the terms defined therein being used herein as therein defined, and
hereby gives you notice irrevocably, pursuant to Section 2.3 of the Credit
Agreement, of the Borrowing specified below:
1. The Business Day of the proposed Borrowing is _______, _____.
2. The aggregate amount of the proposed Borrowing is __________.
3. The Borrowing is to be comprised of ___________ of [Base Rate]
[Eurocurrency] Loans.
4. The duration of the Interest Period for the Eurocurrency Loans
included in the Borrowing shall be [_____ months].
5. The applicable currency is _________________.
The undersigned hereby certifies that the following statements are true on
the date hereof, and will be true on the date of the proposed Borrowing, before
and after giving effect thereto and to the application of the proceeds
therefrom:
(a) the representations and warranties of the Company contained in
Section 5 of the Credit Agreement are true and correct in all material
respects as though made on and as of such date except to the extent that
any such representation or warranty relates solely to an earlier date, in
which case it was true and correct as of such earlier date;
(b) no Default or Event of Default has occurred and is continuing, or
would result from such proposed Borrowing.
A-1
<PAGE>
APTARGROUP, INC.
By:____________________________
Title:_________________________
A-2
<PAGE>
EXHIBIT B
NOTICE OF CONVERSION/CONTINUATION/1/
---------------------------------
Date: _______, _____
To: Bank of America National Trust and Savings Association, as Agent for the
Lenders parties to the Multicurrency Credit Agreement dated as of June 30,
1999 (as extended, renewed, amended or restated from time to time, the
"Credit Agreement") among AptarGroup, Inc., certain Lenders which are
----------------
signatories thereto, and Bank of America National Trust and Savings
Association, as Agent
Ladies and Gentlemen:
The undersigned, AptarGroup, Inc. (the "Borrower"), refers to the Credit
--------
Agreement, the terms defined therein being used herein as therein defined, and
hereby gives you notice irrevocably, pursuant to Section 2.4 of the Credit
Agreement, of the [conversion] [continuation] of the Loans specified herein,
that:
1. The Conversion/Continuation Date is ____________, ____.
2. The aggregate amount of the Loans to be [converted] [continued]
is [$]______________.
3. The Loans are to be [converted into] [continued as]
[Eurocurrency] [Base Rate] Loans.
4. [If applicable:] The duration of the Interest Period for the
Loans included in the [conversion] [continuation] shall be ____ months.
APTARGROUP, INC.
By:___________________________
Title:________________________
__________________
/1/ Eurocurrency Loans may only be continued in the same Currency and may not
be converted into Loans of another currency.
B-1
<PAGE>
EXHIBIT C
COMPLIANCE CERTIFICATE
This Compliance Certificate is furnished to the Agent pursuant to that
certain Credit Agreement dated as of June 30, 1999, by and between AptarGroup,
Inc. (the "Borrower"), the Agent and certain other lenders a party thereto, as
amended from time to time (the "Credit Agreement"). Unless otherwise defined
herein, the terms used in this Compliance Certificate have the meanings ascribed
thereto in the Credit Agreement.
The undersigned hereby certifies that:
1. I am the duly elected _________________________ of the Borrower;
2. I have reviewed the terms of the Credit Agreement and I have
made, or have caused to be made under my supervision, a review of the
transactions and conditions of the Borrower and its Subsidiaries during the
accounting period covered by the attached financial statements;
3. The examinations described in paragraph 2 did not disclose, and I
have no knowledge of, the existence of any condition or the occurrence of
any event which constitutes a Default or Event of Default during or at the
end of the accounting period covered by the attached financial statements
or as of the date of this Certificate, except as set forth below;
4. The financial statements required by Section 6.6 of the Credit
Agreement and being furnished to you concurrently with this certificate
fairly present the financial condition of the Borrower and its Subsidiaries
as of the dates and for the periods covered thereby;
5. The attachment hereto sets forth financial data and computations
evidencing the Borrower's compliance with certain covenants of the Credit
Agreement, all of which data and computations are, to the best of my
knowledge, true, complete and correct and have been made in accordance with
the relevant Sections of the Credit Agreement;
6. Either Schedule 5.1 of the Credit Agreement contains a true and
complete list of all Subsidiaries of the Borrower as of the date hereof or
attached hereto is a substitute Schedule 5.1 which supersedes the prior
Schedule 5.1; and
7. The representations and warranties contained in Section 5 of the
Credit Agreement are true and correct in all material respects as though
made on and as of the
C-1
<PAGE>
date hereof except to the extent that any such representation or warranty
relates solely to an earlier date, in which case it was true and correct
as of such earlier date.
Described below are the exceptions, if any, to paragraph 3 by listing, in
detail, the nature of the condition or event, the period during which it has
existed and the action which the Borrower has taken, are taking, or propose to
take with respect to each such condition or event:
---------------------------------------------------------------------------
---------------------------------------------------------------------------
---------------------------------------------------------------------------
---------------------------------------------------------------------------
The foregoing certifications, together with the computations set forth in
the Attachment hereto and the financial statements delivered with this
Certificate in support hereof, are made and delivered this _______ day of
______________, _____.
-------------------------------------
Name:
--------------------------------
Title:
-------------------------------
C-2
<PAGE>
ATTACHMENT TO COMPLIANCE CERTIFICATE
1. Debt of Subsidiaries (Section 6.14(b)(ii)
(a) Debt of Subsidiaries.......................................... $__________
(b) 45% of Consolidated Net Worth................................. $__________
(c) Does (b) exceed (a)? [Answer should be yes]................... __________
2. Other Advances, Loans and Investments (Section 6.15(i).)
(a) 12.5% of Consolidated Net Worth............................... $__________
(b) Other Advances, Loans and Investments Outstanding............. $__________
(c) Does (a) exceed (b)? [Answer should be yes]................... __________
3. Consolidated Leverage Ratio (Section 6.17.)
(a) Consolidated Debt............................................. $__________
(b) Total Capitalization.......................................... $__________
(c) Ratio of (a) to (b) (shall be not more than 0.6 to 1)......... __________
4. Consolidated Interest Ratio (Section 6.18.)
(a) Consolidated EBITDA........................................... $__________
(b) Consolidated Interest Expense................................. $__________
(c) Ratio of (a) to (b) (shall be at least 3.5 to 1).............. __________
<PAGE>
EXHIBIT D
[FORM OF] ASSIGNMENT AND ACCEPTANCE AGREEMENT
---------------------------------------------
This ASSIGNMENT AND ACCEPTANCE AGREEMENT (this "Assignment and
--------------
Acceptance") dated as of _____________, ______ is made between _________________
- ----------
(the "Assignor") and ___________________ (the "Assignee").
-------- --------
RECITALS
--------
WHEREAS, the Assignor is party to that certain Multicurrency Credit
Agreement dated as of June 30, 1999 (as amended, amended and restated, modified,
supplemented or renewed, the "Credit Agreement") among AptarGroup, Inc., the
----------------
several financial institutions from time to time party thereto (including the
Assignor, the "Lenders"), and Bank of America National Trust and Savings
-------
Association, as Agent for the Lenders (the "Agent"). Any terms defined in the
-----
Credit Agreement and not defined in this Assignment and Acceptance are used
herein as defined in the Credit Agreement;
WHEREAS, as provided under the Credit Agreement, the Assignor has
committed to making Loans (the "Loans") to the Borrower in an aggregate amount
-----
not to exceed $__________ (the "Commitment");
----------
WHEREAS, [the Assignor has made Loans in the aggregate principal
amount of $__________ to the Borrower] [no Loans are outstanding under the
Credit Agreement];
WHEREAS, the Assignor wishes to assign to the Assignee [part of the]
[all] rights and obligations of the Assignor under the Credit Agreement in
respect of its Commitment, [,together with a corresponding portion of each of
its outstanding Loans,] in an amount equal to $__________ (the "Assigned
--------
Amount") on the terms and subject to the conditions set forth herein and the
- ------
Assignee wishes to accept assignment of such rights and to assume such
obligations from the Assignor on such terms and subject to such conditions;
NOW, THEREFORE, in consideration of the foregoing and the mutual
agreements contained herein, the parties hereto agree as follows:
1. Assignment and Acceptance.
-------------------------
(a) Subject to the terms and conditions of this Assignment and
Acceptance, (i) the Assignor hereby sells, transfers and assigns to the
Assignee, and (ii) the Assignee hereby purchases, assumes and undertakes from
the Assignor, without recourse and without
D-1
<PAGE>
representation or warranty (except as provided in this Assignment and
Acceptance) __% (the "Assignee's Percentage Share") of (A) the Commitment [and
---------------------------
the Loans] of the Assignor and (B) all related rights, benefits, obligations,
liabilities and indemnities of the Assignor under and in connection with the
Credit Agreement and the Credit Documents.
(b) With effect on and after the Effective Date (as defined in
Section 5 hereof), the Assignee shall be a party to the Credit Agreement and
succeed to all of the rights and be obligated to perform all of the obligations
of a Lender under the Credit Agreement, including the requirements concerning
confidentiality and the payment of indemnification, with a Commitment in an
amount equal to the Assigned Amount. The Assignee agrees that it will perform in
accordance with their terms all of the obligations which by the terms of the
Credit Agreement are required to be performed by it as a Lender. It is the
intent of the parties hereto that the Commitment of the Assignor shall, as of
the Effective Date, be reduced by an amount equal to the Assigned Amount and the
Assignor shall relinquish its rights and be released from its obligations under
the Credit Agreement to the extent such obligations have been assumed by the
Assignee; provided, however, the Assignor shall not relinquish its rights under
Sections 3.3, 7.5, 8.3 and 10.14 of the Credit Agreement to the extent such
rights relate to the time prior to the Effective Date.
(c) After giving effect to the assignment and assumption set forth
herein, on the Effective Date the Assignee's Commitment will be $__________.
(d) After giving effect to the assignment and assumption set forth
herein, on the Effective Date the Assignor's Commitment will be $__________.
2. Payments.
--------
(a) As consideration for the sale, assignment and transfer
contemplated in Section 1 hereof, the Assignee shall pay to the Assignor on the
Effective Date in immediately available funds an amount equal to $__________,
representing the Assignee's Percentage of the principal amount of all Loans.
(b) The [Assignor] [Assignee] further agrees to pay to the Agent a
processing fee in the amount specified in Section 10.11 of the Credit Agreement.
3. Reallocation of Payments.
------------------------
Any interest, fees and other payments accrued to the Effective Date with
respect to the Commitment [and Loans] shall be for the account of the Assignor.
Any interest, fees and other payments accrued on and after the Effective Date
with respect to the Assigned Amount shall be for the account of the Assignee.
Each of the Assignor and the Assignee agrees that it will hold in trust for the
other party any interest, fees and other amounts which it may receive to which
the other party is entitled pursuant to the preceding sentence and pay to the
other party any such amounts which it may receive promptly upon receipt.
D-2
<PAGE>
4. Independent Credit Decision.
---------------------------
The Assignee (a) acknowledges that it has received a copy of the Credit
Agreement and the Schedules and Exhibits thereto, together with copies of the
most recent financial statements and certificates referred to in Section 6.6(a)
and (b) of the Credit Agreement, and such other documents and information as it
has deemed appropriate to make its own credit and legal analysis and decision to
enter into this Assignment and Acceptance; and (b) agrees that it will,
independently and without reliance upon the Assignor, the Agent or any other
Lender and based on such documents and information as it shall deem appropriate
at the time, continue to make its own credit and legal decisions in taking or
not taking action under the Credit Agreement.
5. Effective Date; Notices.
-----------------------
(a) As between the Assignor and the Assignee, the effective date for
this Assignment and Acceptance shall be __________, _____ (the "Effective
---------
Date"); provided that the following conditions precedent have been satisfied on
--------
or before the Effective Date:
(i) this Assignment and Acceptance shall be executed and
delivered by the Assignor and the Assignee;
(ii) the consent of the Borrower and the Agent required for an
effective assignment of the Assigned Amount by the Assignor to the Assignee
under Section 10.11 of the Credit Agreement shall have been duly obtained and
shall be in full force and effect as of the Effective Date;
(iii) the Assignee shall pay to the Assignor all amounts due to
the Assignor under this Assignment and Acceptance;
[(iv) the Assignee shall have complied with Section 3.3(b) of the
Credit Agreement (if applicable);]
(v) the processing fee referred to in Section 2(b) hereof and
in Section 10.11 of the Credit Agreement shall have been paid to the Agent; and
(vi) the Assignor shall have assigned and the Assignee shall
have assumed a percentage equal to the Assignee's Percentage Share of the rights
and obligations of the Assignor under the Credit Agreement.
(b) Promptly following the execution of this Assignment and
Acceptance, the Assignor shall deliver to the Borrower and the Agent for
acknowledgment by the Agent, a Notice of Assignment substantially in the form
attached hereto as Schedule 1.
----------
6. Agent.
-----
D-3
<PAGE>
(a) The Assignee hereby appoints and authorizes the Assignor to take
such action as Agent on its behalf and to exercise such powers under the Credit
Agreement as are delegated to the Agent by the Lenders pursuant to the terms of
the Credit Agreement.
(b) The Assignee shall assume no duties or obligations held by the
Assignor in its capacity as Agent under the Credit Agreement.
7. Withholding Tax.
---------------
The Assignee (a) represents and warrants to the Lender, the Agent and the
Borrower that under applicable law and treaties no tax will be required to be
withheld by the Lender with respect to any payments to be made to the Assignee
hereunder, (b) agrees to furnish (if it is organized under the laws of any
jurisdiction other than the United States or any State thereof) to the Agent and
the Borrower prior to the time that the Agent or Borrower is required to make
any payment of principal, interest or fees hereunder, duplicate executed
originals of either U.S. Internal Revenue Service Form 4224 or U.S. Internal
Revenue Service Form 1001 (wherein the Assignee claims entitlement to the
benefits of a tax treaty that provides for a complete exemption from U.S.
federal income withholding tax on all payments hereunder) and agrees to provide
new Forms 4224 or 1001 upon the expiration of any previously delivered form or
comparable statements in accordance with applicable U.S. law and regulations and
amendments thereto, duly executed and completed by the Assignee, and (c) agrees
to comply with all applicable U.S. laws and regulations with regard to such
withholding tax exemption.
8. Representations and Warranties.
------------------------------
(a) The Assignor represents and warrants that (i) it is the legal and
beneficial owner of the interest being assigned by it hereunder and that such
interest is free and clear of any Lien or other adverse claim; (ii) it is duly
organized and existing and it has the full power and authority to take, and has
taken, all action necessary to execute and deliver this Assignment and
Acceptance and any other documents required or permitted to be executed or
delivered by it in connection with this Assignment and Acceptance and to fulfill
its obligations hereunder; (iii) no notices to, or consents, authorizations or
approvals of, any Person are required (other than any already given or obtained)
for its due execution, delivery and performance of this Assignment and
Acceptance, and apart from any agreements or undertakings or filings required by
the Credit Agreement, no further action by, or notice to, or filing with, any
Person is required of it for such execution, delivery or performance; and (iv)
this Assignment and Acceptance has been duly executed and delivered by it and
constitutes the legal, valid and binding obligation of the Assignor, enforceable
against the Assignor in accordance with the terms hereof, subject, as to
enforcement, to bankruptcy, insolvency, moratorium, reorganization and other
laws of general application relating to or affecting creditors' rights and to
general equitable principles.
D-4
<PAGE>
(b) The Assignor makes no representation or warranty and assumes no
responsibility with respect to any statements, warranties or representations
made in or in connection with the Credit Agreement or the execution, legality,
validity, enforceability, genuineness, sufficiency or value of the Credit
Agreement or any other instrument or document furnished pursuant thereto. The
Assignor makes no representation or warranty in connection with, and assumes no
responsibility with respect to, the solvency, financial condition or statements
of the Borrower, or the performance or observance by the Borrower, of any of its
respective obligations under the Credit Agreement or any other instrument or
document furnished in connection therewith.
(c) The Assignee represents and warrants that (i) it is duly
organized and existing and it has full power and authority to take, and has
taken, all action necessary to execute and deliver this Assignment and
Acceptance and any other documents required or permitted to be executed or
delivered by it in connection with this Assignment and Acceptance, and to
fulfill its obligations hereunder; (ii) no notices to, or consents,
authorizations or approvals of, any Person are required (other than any already
given or obtained) for its due execution, delivery and performance of this
Assignment and Acceptance; and apart from any agreements or undertakings or
filings required by the Credit Agreement, no further action by, or notice to, or
filing with, any Person is required of it for such execution, delivery or
performance; (iii) this Assignment and Acceptance has been duly executed and
delivered by it and constitutes the legal, valid and binding obligation of the
Assignee, enforceable against the Assignee in accordance with the terms hereof,
subject, as to enforcement, to bankruptcy, insolvency, moratorium,
reorganization and other laws of general application relating to or affecting
creditors' rights and to general equitable principles; and (iv) it is an
Eligible Assignee.
9. Further Assurances.
------------------
The Assignor and the Assignee each hereby agree to execute and deliver such
other instruments, and take such other action, as either party may reasonably
request in connection with the transactions contemplated by this Assignment and
Acceptance, including the delivery of any notices or other documents or
instruments to the Borrower or the Agent, which may be required in connection
with the assignment and assumption contemplated hereby.
10. Miscellaneous.
-------------
(a) Any amendment or waiver of any provision of this Assignment and
Acceptance shall be in writing and signed by the parties hereto. No failure or
delay by either party hereto in exercising any right, power or privilege
hereunder shall operate as a waiver thereof and any waiver of any breach of the
provisions of this Assignment and Acceptance shall be without prejudice to any
rights with respect to any other or further breach thereof.
D-5
<PAGE>
(b) All payments made hereunder shall be made without any set-off or
counterclaim.
(c) The Assignor and the Assignee shall each pay its own costs and
expenses incurred in connection with the negotiation, preparation, execution and
performance of this Assignment and Acceptance.
(d) This Assignment and Acceptance may be executed in any number of
counterparts and all of such counterparts taken together shall be deemed to
constitute one and the same instrument.
(e) THIS ASSIGNMENT AND ACCEPTANCE SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAW OF THE STATE OF ILLINOIS. The Assignor and the
Assignee each irrevocably submits to the non-exclusive jurisdiction of any State
or Federal court sitting in Illinois over any suit, action or proceeding arising
out of or relating to this Assignment and Acceptance and irrevocably agrees that
all claims in respect of such action or proceeding may be heard and determined
in such Illinois State or Federal court. Each party to this Assignment and
Acceptance hereby irrevocably waives, to the fullest extent it may effectively
do so, the defense of an inconvenient forum to the maintenance of such action or
proceeding.
(f) THE ASSIGNOR AND THE ASSIGNEE EACH HEREBY KNOWINGLY, VOLUNTARILY
AND INTENTIONALLY WAIVE ANY RIGHTS THEY MAY HAVE TO A TRIAL BY JURY IN RESPECT
OF ANY LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH
THIS ASSIGNMENT AND ACCEPTANCE, THE CREDIT AGREEMENT, ANY RELATED DOCUMENTS AND
AGREEMENTS OR ANY COURSE OF CONDUCT, COURSE OF DEALING, OR STATEMENTS (WHETHER
ORAL OR WRITTEN).
[Other provisions to be added as may be negotiated between the
Assignor and the Assignee, provided that such provisions are not inconsistent
with the Credit Agreement.]
D-6
<PAGE>
IN WITNESS WHEREOF, the Assignor and the Assignee have caused this
Assignment and Acceptance to be executed and delivered by their duly authorized
officers as of the date first above written.
[ASSIGNOR]
By:______________________________
Title:___________________________
By:______________________________
Title:___________________________
Address:
D-7
<PAGE>
[ASSIGNEE]
By:_________________________________
Title:______________________________
By:_________________________________
Title:______________________________
Address:
D-8
<PAGE>
SCHEDULE 1
NOTICE OF ASSIGNMENT AND ACCEPTANCE
-----------------------------------
_______________, ____
Bank of America National Trust
and Savings Association, as Agent
1850 Gateway Blvd., 5th Floor
Concord, CA 94520
Attn: Agency Management Services #5596
AptarGroup, Inc.
475 West Terra Cotta Avenue
Suite E
Crystal Lake, IL 60014
Attn: Vice President - Risk Management
Ladies and Gentlemen:
We refer to the Multicurrency Credit Agreement dated as of June 30, 1999
(as amended, amended and restated, modified, supplemented or renewed from time
to time the "Credit Agreement") among AptarGroup, Inc., the Lenders referred to
----------------
therein, and Bank of America National Trust and Savings Association as Agent for
the Lenders (the "Agent"). Terms defined in the Credit Agreement are used
-----
herein as therein defined.
1. We hereby give you notice of, and request your consent to, the
assignment by __________________ (the "Assignor") to _______________ (the
--------
"Assignee") of _____% of the right, title and interest of the Assignor in and to
--------
the Credit Agreement (including, without limitation, the right, title and
interest of the Assignor in and to the Commitments of the Assignor [and all
outstanding Loans made by the Assignor]) pursuant to the Assignment and
Acceptance Agreement attached hereto (the "Assignment and Acceptance"). Before
-------------------------
giving effect to such assignment the Assignor's Commitment is $ ___________ [and
the aggregate amount of its outstanding Loans is $_____________].
2. The Assignee agrees that, upon receiving the consent of the Agent and,
if applicable, AptarGroup, Inc. to such assignment, the Assignee will be bound
by the terms of the Credit Agreement as fully and to the same extent as if the
Assignee were the Lender originally holding such interest in the Credit
Agreement.
<PAGE>
3. The following administrative details apply to the Assignee:
(A) Notice Address:
Assignee name:
Address:
Attention:
Telephone: (___)
Telecopier: (___)
Telex (Answerback):
(B) Payment Instructions:
Account No.:
At:
Reference:
Attention:
4. You are entitled to rely upon the representations, warranties and
covenants of each of the Assignor and Assignee contained in the Assignment and
Acceptance.
IN WITNESS WHEREOF, the Assignor and the Assignee have caused this Notice
of Assignment and Acceptance to be executed by their respective duly authorized
officials, officers or agents as of the date first above mentioned.
Very truly yours,
[NAME OF ASSIGNOR]
By:
Title:
By:
Title:
<PAGE>
[NAME OF ASSIGNEE]
By:
Title:
By:
Title:
ACKNOWLEDGED AND ASSIGNMENT
CONSENTED TO:
APTARGROUP, INC.
By:
Title:
By:
Title:
BANK OF AMERICA NATIONAL TRUST AND
SAVINGS ASSOCIATION, as Agent
By:
Title:
<PAGE>
SCHEDULE 2.1
COMMITMENTS
Bank Commitment Percentage
- ------------------------------------------------------------
BANK OF AMERICA NATIONAL
TRUST AND SAVINGS
ASSOCIATION $27,000,000 36.00 %
ABN AMRO BANK N.V. 10,000,000 13.33%
FLEET NATIONAL BANK 23,000,000 30.67%
SOCIETE GENERALE - CHICAGO 15,000,000 20.00%
BRANCH
TOTAL $75,000,000 100.00%
<PAGE>
SCHEDULE 5.1
------------
SUBSIDIARIES OF THE COMPANY
AND OWNERSHIP OF SUBSIDIARY STOCK
<TABLE>
<CAPTION>
State or Other
Jurisdiction of Percentage
Incorporation Owned
--------------- ----------
<S> <C> <C>
AptarGroup International L.L.C. Delaware 100%
AptarGroup Foreign Sales Corporation Barbados 100%
AptarGroup Holding S.A. France 100%
Aptar GmbH Germany 100%
Erich Pfeiffer GmbH Germany 100%
Pfeiffer Vaporisateurs France S.a.r.L. France 100%
P & S Japan Ltd. Japan 100%
Pfeiffer (U.K.) Limited United Kingdom 100%
P&P Promotion of German Manufacturing
Technologies GmbH Germany 100%
Vallis Leasobjekt Gesellschaft GmbH Germany 51%
Loeffler Beteilugungs GmbH Germany 100%
Seaplast S.A. * Spain 50%
Seaquist-Loeffler GmbH Germany 100%
Loffler Stet Spol. S.R.O. Czech Republic 100%
SeaquistPerfect Dispensing GmbH Germany 100%
Valois Deutschland GmbH Germany 100%
AptarGroup S.A. France 100%
Aptar South Europe SARL France 100%
Novares S.p.A. Italy 100%
SAR S.p.A Italy 100%
SAR France SCA France 100%
AptarGroup SAR Finance Unlimited Ireland 100%
Sar GmbH Germany 100%
SAR (U.K.) Limited United Kingdom 100%
Tes S.p.A. * Italy 35%
Caideil M.P. Teoranta Ireland 100%
General Plastics S.A. France 100%
Graphocolor France 60%
Moulage Plastique de Normandie S.A. France 100%
Perfect-Valois U.K. Limited United Kingdom 100%
Seaquist-Loeffler Limited United Kingdom 100%
Valois S.A France 100%
Valois Dispray S.A. Switzerland 100%
Valois Espana S.A. Spain 100%
Valois Italiana S.r.l. Italy 100%
Inairic S.A. Argentina 100%
Sar Dispensing Systems Ltd. Hong Kong 100%
SAR Do Brasil Ltda. Brazil 100%
</TABLE>
Schedule 5.1
<PAGE>
<TABLE>
<CAPTION>
SCHEDULE 5.1
------------
SUBSIDIARIES OF THE COMPANY
AND OWNERSHIP OF SUBSIDIARY STOCK
<S> <C> <C>
Seaquist Canada Ltd. Canada 100%
Seaquist Finance Unlimited Ireland 100%
Seaquist-Valois Australia Pty. Ltd. Australia 100%
Seaquist-Valois do Brasil Ltda. Brazil 100%
Seaquist-Valois Japan, Inc. Japan 100%
Aptar Suzhou Dispensing Ltd. P.R. China 100%
CosterSeaquist L.L.C.* Illinois 50%
Emson Research, Inc. Connecticut 100%
Emson Europe Ltd. United Kingdom 100%
Emson Foreign Sales Corporation U.S. Virgin Islands 100%
EMSAR, Inc. Connecticut 100%
Emson Ventures, Inc. Connecticut 100%
Emson Ventures II, Inc. Connecticut 100%
P.T. Emson Ongko Indonesia Indonesia 100%
Emson Ventures III, Inc. Connecticut 100%
Emson Spraytech India Private Ltd. India 51%
Emson Ventures IV, Inc. Connecticut 100%
Global Precision, Inc. Florida 100%
Liquid Molding Systems, Inc. Delaware 100%
Philson, Inc. Connecticut 100%
Pfeiffer of America, Inc. Delaware 100%
P Merger Corporation Connecticut 100%
R.P.M. Manufacturing Company Connecticut 100%
SAR U.S.A. Inc. Delaware 100%
Seaquist Closures L.L.C. Delaware 100%
Seaquist Closures Foreign, Inc. Delaware 100%
Seaquist de Mexico, S.A. de C.V. Mexico 75%
SeaquistPerfect Dispensing L.L.C. Delaware 100%
SeaquistPerfect Dispensing Foreign, Inc. Delaware 100%
Valois of America, Inc. Connecticut 100%
</TABLE>
* Indicates affiliate of the Company
Schedule 5.1
<PAGE>
SCHEDULE 5.18
DEBT
<TABLE>
<CAPTION>
Description Secured by Rate - fixed Interest Issue Maturity
Bank name of Debt Assets or variable? Rate Date Date
--------- ----------- ---------- ------------ -------- ----- --------
OVERDRAFTS
<S> <C> <C> <C> <C> <C> <C> <C>
AAPTUS Other Bank No V 0.00%
Aptar GmbH West LB Bank No V 6.00% 03/31/99 04/01/99
Aptar GmbH ABN Amro Bank No V 6.00% 03/31/99 04/01/99
General Plastics Bred Bank No V 3.80% 3/31/99 3/31/99
General Plastics SG Bank No V 4.20% 3/31/99 3/31/99
Graphocolor Credit Lyonnais Bank No V 3.88% 3/31/99 4/15/99
Graphocolor BNP Bank No V 3.83% 3/31/99 4/15/99
Graphocolor SG Bank No V 0.04% 3/31/99 4/15/99
Inairic BNL Bank Y V 0.18% 2/25/99 2/25/00
Perfect-Valois UK Bank National De Paris Bank No V 7.00% 3/99 Revolving
Seaquist Japan Mitsubishi Bank Bank No V 3.50% 8/29/97 8/28/02
Seaquist Japan Mitsubishi Bank Bank No V 3.50% 6/23/98 6/2/03
Seaquist Japan BNP Bank No V 2.00% 12/18/98 12/31/05
Seaquist Japan Sumitomo Bank Bank No V 2.50% 12/18/98 12/17/03
Seaquist Loffler Germany Volksbank Bank No V 6.25% 3/30/99 4/30/99
SPD France BFCE Bank No V 3.79% 3/31/99 N/A
SPD France SG Bank No V 3.00% 3/31/99 N/A
SPD GmbH West LB Bank No V 6.00% 3/31/99 4/1/99
SPD GmbH ABN Amro Bank No V 6.00% 3/31/98 4/1/99
Valois Credit Lyonnais Bank No V 3.61% 3/31/99 N/A
Valois Credit Agricole Bank No V 3.61% 3/31/99 N/A
Valois SG Bank No V 3.61% 3/31/99 N/A
</TABLE>
<TABLE>
<CAPTION>
LC - ST LC - LT TOTAL - LC US$ - ST US$ - LT TOTAL $
--------------------------------------------------------------------------------
OVERDRAFTS
<S> <C> <C> <C> <C> <C> <C>
AAPTUS 2,326,589 2,326,589 2,326,589 0 2,326,589
Aptar GmbH 28,463 28,463 15,673 0 15,673
Aptar GmbH 3 3 2 0 2
General Plastics 339,171 339,171 55,688 0 55,688
General Plastics 1,444,434 1,444,434 237,159 0 237,159
Graphocolor 3,675,862 3,675,862 603,532 0 603,532
Graphocolor 2,456,989 2,456,989 403,408 0 403,408
Graphocolor 424,084 424,084 69,630 0 69,630
Inairic 592,253 592,253 592,549 0 592,549
Perfect-Valois UK 497,073 497,073 801,182 0 801,182
Seaquist Japan 13,673,000 13,673,000 115,045 0 115,045
Seaquist Japan 4,170,000 4,170,000 35,086 0 35,086
Seaquist Japan 306,262,705 306,262,705 2,576,894 0 2,576,894
Seaquist Japan 46,668,000 46,668,000 392,665 0 392,665
Seaquist Loffler Germany 729,348 729,348 401,623 0 401,623
SPD France 177,671 177,671 29,171 0 29,171
SPD France 230,157 230,157 37,789 0 37,789
SPD GmbH 846,377 846,377 466,067 0 466,067
SPD GmbH 1,440,778 1,440,778 793,380 0 793,380
Valois 246,688 246,688 40,503 0 40,503
Valois 2,008,643 2,008,643 329,795 0 329,795
Valois 468,959 468,959 76,997 0 76,997
---------------------------------------------
TOTAL OVERDRAFTS 10,400,429 0 10,400,429
---------------------------------------------
</TABLE>
Schedule 5.18
<PAGE>
SCHEDULE 5.18
-------------
DEBT
<TABLE>
<CAPTION>
Description Secured by Rate - fixed Interest Issue Maturity
Bank name of Debt Assets or variable? Rate Date Date
--------- ----------- ---------- ------------ -------- ----- --------
ST NOTES PAYABLE
<S> <C> <C> <C> <C> <C> <C> <C>
AptarGroup ABN Amro Bank No V 5.35% 01/11/99 04/11/99
AptarGroup Society General Bank No V 5.60% 03/31/99 04/01/99
AptarGroup WLB Bank No V 5.17% 03/30/99 04/06/99
AptarGroup BOA Bank No V 5.42% 2/19/99 04/30/99
China IBPS Bank No V 5.90% 7/16/98 7/15/99
China Bank of China Bank No V 5.77% 7/14/98 7/13/99
China Bank of China Bank No V 6.52% 7/24/98 7/13/99
Elims Reclass ST
Emson Foreign Sales Corp. Fleet Bank No V 0.00% 03/31/99 04/05/99
Emson, Inc. Fleet Bank No V 0.00% 03/31/99 04/05/99
Emson, Inc. Fleet Bank No V 0.00% 03/31/99 04/05/99
Emson, Inc. Fleet Bank No V 0.00% 03/31/99 04/05/99
General plastics BNP Bank No V 3.88% 2/15/98 4/15/99
Novares S p A IMI-S PAOLO Bank N/A F 5.60% 2/98 8/99
Novares S p A IBM Semea Other N/A F 9.35% 10/98 12/99
S Loffler Ltd BOA Bank No V 6.00% 11/2/99 5/5/99
Sar France Groupe Soval Bank No V 10.90% 11/96 5/99
Seaquist Loffler Germany DM Eurokredit Bank No V 3.96% 2/15/99 5/15/99
Seaquist Loffler Germany DB Eurokredit Bank No V 3.96% 3/11/99 6/11/99
SV Australia ABN Amro Bank Yes V 5.35% 3/24/99 5/24/99
SV Australia ABN Amro Bank Yes V 5.38% 3/29/99 4/29/99
Valois CIN Bank No V 3.24% 3/18/99 4/1/99
Valois CIN Bank No V 3.24% 3/19/99 4/1/99
Valois CIN Bank No V 3.23% 3/22/99 4/1/99
DISCOUNTED NOTES
Valois Spain Bilbao Vizcaya Bank No V 7.00% 1/23/99 4/25/99
</TABLE>
<TABLE>
<CAPTION>
LC - ST LC - LT TOTAL - LC US$ - ST US$ - LT TOTAL $
------------------------------------------------------------------------------
OVERDRAFTS
<S> <C> <C> <C> <C> <C> <C>
0 0 0 0 0
AptarGroup 15,000,000 15,000,000 15,000,000 0 15,000,000
AptarGroup 600,000 600,000 600,000 0 600,000
AptarGroup 10,500,000 10,500,000 10,500,000 0 10,500,000
AptarGroup 123,000,000 123,000,000 123,000,000 0 123,000,000
China 828,000 828,000 100,022 0 100,022
China 15,000,000 15,000,000 1,812,000 0 1,812,000
China 10,000,000 10,000,000 1,208,000 0 1,208,000
Elims (25,000,000) (25,000,000) (25,000,000) (25,000,000)
Emson Foreign Sales Corp. 21,641 21,641 21,641 0 21,641
Emson, Inc. 1,084,366 1,084,366 1,084,366 0 1,084,366
Emson, Inc, 104,788 104,788 104,788 0 104,788
Emson, Inc. 45,608 45,608 45,608 0 45,608
General plastics 274,500 274,500 45,070 0 45,070
Novares S p A 5,000,000 5,000,000 2,781,000 0 2,781,000
Novares S p A 677,552 677,552 378,854 0 376,854
S Loffler Ltd 1,300,000 1,300,000 2,095,340 0 2,095,340
Sar France 17,573 17,573 2,885 0 2,885
Seaquist Loffler Germany 2,000,000 2,000,000 1,101,322 0 1,101,322
Seaquist Loffler Germany 2,000,000 2,000,000 1,101,322 0 1,101,322
SV Australia 100,000 100,000 63,430 0 63,430
SV Australia 100,000 100,000 63,430 0 63,430
Valois 2,800,000 2,800,000 459,726 0 459,726
Valois 9,200,000 9,200,000 1,510,530 0 1,510,530
Valois 3,500,000 3,500,000 574,658 0 574,658
---------------------------------------------
138,651,993 0 138,651,993
---------------------------------------------
DISCOUNTED NOTES
Valois Spain 1,005,662 1,005,662 6,510 0 6,510
---------------------------------------------
6,510 0 6,510
---------------------------------------------
</TABLE>
Schedule 5.18
<PAGE>
SCHEDULE 5.18
-------------
DEBT
<TABLE>
<CAPTION>
Description Secured by Rate - fixed Interest Issue Maturity
Bank name of Debt Assets or variable? Rate Date Date LC - ST LC - LT
--------- ------- ------ ----------- ---- ---- ---- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
NOTES PAYABLE
AptarGroup Nationwide Life Other No F 7.08% 10/1/95 9/30/05 3,571,429 21,428,571
AptarGroup Reclass ST Other No 4/29/01 25,000,000
Emson, Inc. Bank Term Loan Bank No V 6.53% 4/15/98 5/1/03 800,000 2,466,667
Emson, Inc. Revolver Bank No V 5.56% 4/15/98 5/1/01 0 7,700,000
Emson, Inc. Revolver Bank No V 5.46% 4/15/98 5/1/01 0 10,000,000
Emson India Pavron Loan No V 0.00% 0 2,022,022
General Plastics BNP Bank No F 5.11% 8/98 7/03 372,739 1,389,120
General Plastics Bred Bank No F 4.90% 8/97 7/01 100,668 142,115
General Plastics Bred Bank No F 4.90% 8/97 7/01 251,670 355,287
General Plastics Credipar Bank No F 11.08% 11/95 10/99 14,674 0
General Plastics SNVB Codevi Bank No F 6.10% 7/96 7/00 257,500 128,750
General Plastics SNVB Codevi Bank No V 5.60% 8/96 8/00 198,750 99,375
Graphocolor Agency Bassin Other No F 0.50% 10/16/97 10/16/08 42,000 378,000
Graphocolor Agency Bassin Other No F 0.50% 3/26/91 3/16/00 0 106,400
Graphocolor Agency Bassin Other No F 0.50% 1/16/97 1/16/00 0 1,052,800
Graphocolor SDR Other No F 7.20% 1/1/90 1/1/99 190,214 0
Graphocolor CMT Other No V 3.80% 8/20/96 8/20/03 1,232,145 6,160,705
Graphocolor CMT Other No V 3.80% 8/20/96 8/20/03 375,000 1,875,000
MPN Credit General
Industriel Bank F 0.00% 0 0 0 0
MPN Societe General Bank No F 4.95% 8/98 1/00 245,725 646,442
MPN Societe General Bank Yes F 6.10% 6/96 5/00 88,043 109,721
MPN CIC Bank No F 5.40% 8/97 7/01 120,863 171,622
MPN Societe General Bank No V 5.14% 8/97 7/01 276,538 391,488
SAR Loan L Other No F 3.69% 1/13/95 7/29/09 0 1,392,973
SAR Loan I Other No F 0.00% 7/97 1/99 0 0
Seaquist de
Mexico Other Bank Yes F 0.00% 0 0 273,696 136,848
Seaquist
Loffler Germany GEFA 83165 Other No F 4.94% 3/1/97 1/1/99 0 0
Seaquist
Loffler Germany GEFA 83166 Other No F 4.74% 4/1/97 2/1/99 0 0
Seaquist
Loffler Germany GEFA 83167 Other No F 5.70% 12/1/97 10/1/99 101,500 0
Seaquist
Loffler Germany GEFA 83153 Other No F 5.79% 5/1/98 3/1/00 99,000 22,000
Seaquist
Loffler Germany GEFA 83154 Other No F 5.53% 5/1/98 3/1/00 174,150 77,400
Seaquist
Loffler Germany GEFA 83155 Other No F 5.53% 6/1/98 4/1/00 124,470 41,490
Seaquist
Loffler Germany GEFA 83152 Other No F 5.24% 10/1/97 8/1/99 27,500 0
Seaquist
Loffler Germany Loeffler Loan Other No F 4.90% 7/31/98 9/30/04 623,679 6,082,522
Valois ANVAR Bank No F 0.00% 9/4/92 6/30/00 200,000 200,000
Valois Participation Other No F 6.00% 4/1/93 4/1/03 5,406,901 28,744,466
Valois Italiana Mediocredito Bank No V 1.20% 12/31/98 6/30/08 40,000 360,786
Valois of
America CDA Other Yes F 4.50% 11/28/95 6/1/95 91,808 605,240
TOTAL - LC US$ - ST US$ - LT TOTAL $
-------------------------------------------------
<S> <C> <C> <C> <C>
NOTES PAYABLE
AptarGroup 25,000,000 3,571,429 21,428,571 25,000,000
AptarGroup 25,000,000 0 25,000,000 25,000,000
Emson, Inc. 3,266,667 800,000 2,466,667 3,266,667
Emson, Inc. 7,700,000 0 7,700,000 7,700,000
Emson, Inc. 10,000,000 0 10,000,000 10,000,000
Emson India 2,022,022 0 47,659 47,659
General Plastics 1,761,859 61,199 228,077 289,276
General Plastics 242,783 16,528 23,334 39,882
General Plastics 606,957 41,321 58,334 99,655
General Plastics 14,674 2,409 0 2,409
General Plastics 386,250 42,278 21,139 63,418
General Plastics 298,125 32,632 16,316 48,949
Graphocolor 420,000 6,896 62,063 68,959
Graphocolor 106,400 0 17,470 17,470
Graphocolor 1,052,800 0 172,857 172,857
Graphocolor 190,214 31,231 0 31,231
Graphocolor 7,392,850 202,303 1,011,514 1,213,817
Graphocolor 2,250,000 61,571 307,853 369,423
MPN 0 0 0 0
MPN 892,167 40,345 106,138 146,483
MPN 197,764 14,456 18,015 32,470
MPN 292,485 19,844 28,178 48,023
MPN 668,026 45,404 64,278 109,682
SAR 1,392,973 0 774,772 774,772
SAR 0 0 0 0
Seaquist de
Mexico 410,544 28,738 14,369 43,107
Seaquist
Loffler Germany 0 0 0 0
Seaquist
Loffler Germany 0 0 0 0
Seaquist
Loffler Germany 101,500 55,892 0 55,892
Seaquist
Loffler Germany 121,000 54,515 12,115 66,630
Seaquist
Loffler Germany 251,550 95,898 42,621 138,519
Seaquist
Loffler Germany 165,960 68,541 22,847 91,388
Seaquist
Loffler Germany 27,500 15,143 0 15,143
Seaquist
Loffler Germany 6,706,201 343,436 3,349,408 3,692,843
Valois 400,000 32,838 32,838 65,675
Valois 34,151,367 887,748 4,719,496 5,607,245
Valois Italiana 400,786 22,248 200,669 222,917
Valois of
America 697,048 91,808 605,240 697,048
ROUNDING (1) (1)
--------------------------------------
TOTAL NOTES PAYABLE 6,686,652 78,552,836 85,239,487
--------------------------------------
</TABLE>
Schedule 5.18
<PAGE>
SCHEDULE 5.18
DEBT
<TABLE>
<CAPTION>
Bank name Description Secured by Rate - fixed Interest Issue Maturity LC - ST
--------- of Debt Assets or Variable? Rate Date Date -------
------- ------ ----------- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C> <C>
MORTGAGES PAYABLE
General Plastics Credit Agricole Bank Yes F 5.90% 1/97 12/00 260,718
General Plastics Societe General Bank Yes V 4.65% 4/98 1/02 225,000
General Plastics Credit Agricole Bank Yes F 5.05% 8/98 7/02 153,886
General Plastics SNVB Bank Yes F 4.80% 8/98 7/02 199,094
General Plastics SNVB Bank Yes F 5.25% 8/98 7/02 188,740
General Plastics Bred Bank Yes F 4.80% 10/98 7/02 177,350
General Plastics BNP Bank Yes F 4.09% 3/99 9/03 91,066
General Plastics BNP Bank Yes F 4.09% 3/99 2/03 772,842
Novares S.p.A. Loan BNL Other No F 2.10% 12/22/98 6/30/08 269,260
Pfeiffer GmbH Commerzbank Bank Yes F 4.70% 06/96 3/99 0
Pfeiffer GmbH West LB Bank Yes F 5.00% 06/96 12/01 161,515
Pfeiffer GmbH Sparkasse Bank No F 4.95% 3/98 12/02 1,000,000
Pfeiffer GmbH BW Bank Bank No F 4.90% 11/97 12/02 1,000,000
Pfeiffer GmbH BW Bank Bank No F 5.00% 06/96 12/99 625,000
Sar Loan Other Yes F 5.25% 12/31/94 6/30/04 599,035
INDUSTRIAL REV BONDS
SPD US IRB IRB No V 6.05% 12/96 12/01 333,400
</TABLE>
<TABLE>
<CAPTION>
LC - LT TOTAL - LC US$ - ST US$ - LT TOTAL $
--------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
MORTGAGES PAYABLE
General Plastics 205,859 466,577 42,807 33,800 76,606
General Plastics 450,000 675,000 36,942 73,885 110,827
General Plastics 572,747 726,633 25,266 94,038 119,304
General Plastics 503,378 702,472 32,689 82,649 115,337
General Plastics 480,816 669,556 30,989 78,944 109,933
General Plastics 692,111 869,461 29,119 113,636 142,755
General Plastics 908,934 1,000,000 14,952 149,236 164,188
General Plastics 3,427,158 4,200,000 126,891 562,698 689,590
Novares S.p.A. 2,530,740 2,800,000 149,762 1,407,598 1,557,360
Pfeiffer GmbH 0 0 0 0 0
Pfeiffer GmbH 323,338 484,853 88,940 178,050 266,990
Pfeiffer GmbH 3,000,000 4,000,000 550,661 1,651,983 2,202,644
Pfeiffer GmbH 3,000,000 4,000,000 550,661 1,651,983 2,202,644
Pfeiffer GmbH 0 625,000 344,163 0 344,163
Sar 3,115,244 3,714,279 333,183 1,732,699 2,065,882
ROUNDING (1) (1)
-----------------------------------
TOTAL MORT PAYABLE 2,357,025 7,811,198 10,168,223
-----------------------------------
INDUSTRIAL REV BONDS
SPD US 582,450 915,850 333,400 582,450 915,850
-----------------------------------
</TABLE>
Schedule 5.18
<PAGE>
SCHEDULE 5.18
-------------
<TABLE>
<CAPTION>
DEBT
Description Secured by Rate - fixed Interest Issue Maturity
Bank name of Debt Assets or variable? Rate Date Date
--------- ----------- --------- ----------- ------- ----- --------
CAPITAL LEASES
<S> <C> <C> <C> <C> <C> <C> <C>
Dispray Capital Lease Building Yes F 2.50% 7/88 7/03
Dispray Capital Lease Building Yes F 6.62% 3/95 3/05
General Plastics Capital Lease Press Yes F 8.02% 3/15/95 3/15/00
General Plastics Capital Lease Press Yes F 8.32% 8/15/95 8/15/00
General Plastics Capital Lease Press Yes F 7.59% 4/1/96 11/26/00
Graphocolor Capital Lease Misc Equip No V 4.08% 12/30/96 12/30/08
MPN Capital Lease Sofinbail Yes F 7.49% 3/95 3/00
Pfeiffer-Vlaois UK Capital Lease Fork Lift Truc No F 12.43% 7/1/98 6/30/03
Rounding
Seaquist Loffler Czech Capital Lease Machine Yes F 7.00% 7/1/98 6/1/02
SVC Australia Capital Lease Volkswagon Yes F 7.24% 3/22/99 3/22/03
SVC Australia Capital Lease Subaru Yes F 6.99% 11/7/97 11/7/01
Valois Capital Lease Domibail Yes V 3.88% 6/30/90 6/30/05
Valois Capital Lease Domibail Yes V 3.85% 12/1/93 12/1/08
Valois Capital Lease Domibail Yes V 4.80% 1/10/90 7/4/05
</TABLE>
<TABLE>
<CAPTION>
LC - ST LC - LT TOTAL - LC US$ - ST US$ - LT TOTAL $
-------------------------------------------------------------------------
CAPITAL LEASES
<S> <C> <C> <C> <C> <C> <C>
Dispray 16,932 1,150,598 1,167,530 11,429 776,654 788,083
Dispray 16,418 1,190,101 1,206,519 11,082 803,318 814,400
General Plastics 372,964 0 372,964 61,236 0 61,236
General Plastics 99,557 48,564 148,121 16,346 7,974 24,320
General Plastics 101,831 79,678 181,509 16,719 13,082 29,802
Graphocolor 903,591 13,763,159 14,666,750 148,359 2,259,746 2,408,104
MPN 191,346 0 191,346 31,417 0 31,417
Pfeiffer-Vlaois 3,126 14,406 17,532 5,038 23,220 28,258
Rounding ROUNDING 2 2
Seaquist Loffler Czech 4,360,447 16,421,359 20,781,806 121,787 458,649 580,436
SVC Australia 6,226 42,608 48,834 3,949 27,026 30,975
SVC Australia 5,182 25,789 30,971 3,287 16,358 19,645
Valois 2,031,127 8,784,702 10,815,829 333,487 1,442,343 1,775,829
Valois 1,842,110 11,099,429 12,941,539 302,452 1,822,393 2,124,845
Valois 912,145 6,850,357 7,762,502 149,763 1,124,746 1,274,510
-----------------------------------
TOTAL CAPITAL LEASES 1,216,355 8,775,508 9,991,862
-----------------------------------
</TABLE>
Schedule 5.18
<PAGE>
SCHEDULE 5.18
-------------
DEBT
<TABLE>
<CAPTION>
Description Secured by Rate - fixed Interest Issue Maturity
Bank name of Debt Assets or variable? Rate Date Date
--------- ----------- ---------- ------------ -------- ----- --------
<S> <C> <C> <C> <C> <C> <C> <C>
All other Debt between
March 31, 1999 and the
Effective Date which had an
original principal amount in
excess of $25,000,000:
AptarGroup debt placement Various Private No Fixed 6.62% 5/28/99 5/30/11
institutions Placement
Repay ST note from proceeds BOA Updated
Total
<CAPTION>
LC - ST LC - LT TOTAL - LC US$ - ST US$ - LT TOTAL $
------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
GRAND TOTAL DEBT PER BOOKS
at March 31, 1999 159,652,362 95,721,991 255,374,353
=========================================
All other Debt between
March 31, 1999 and the
Effective Date which had an
original principal amount in
excess of $25,000,000:
AptarGroup debt placement
0 107,000,000 107,000,000
Repay ST note from proceeds BOA (107,000,000) (107,000,000)
-----------------------------------------
52,652,362 202,721,991 255,374,353
=========================================
</TABLE>
Schedule 5.18
<PAGE>
SCHEDULE 6.15
EXISTING INVESTMENTS
Equity investments:
Seaplast (50%) 1,585,681
TES (40%) 74,923
CosterSeaquist LLC (50%) 2,624,757
----------
Subtotal 4,285,361
Other:
Fadeva loan 500,000
----------
Grand Total 4,785,361
==========
<PAGE>
SCHEDULE 10.2
OFFSHORE AND DOMESTIC LENDING OFFICES,
ADDRESSES FOR NOTICES
BANK OF AMERICA NATIONAL TRUST
- ------------------------------
AND SAVINGS ASSOCIATION,
- -----------------------
As Administrative Agent
Bank of America National Trust
and Savings Association
Agency Management Services #5596
1850 Gateway Boulevard, 5th Floor
Concord, CA 94520
Attention: Jon Kubokawa
Telephone: (925) 675-8401
Facsimile: (925) 675-8500
Notices (other than Borrowing Notices and Notices of Conversion/Continuation):
Bank of America National Trust and Savings Association
231 S. LaSalle Street
Chicago, IL 60201
Attention: M.H. Claggett, Vice President
Telephone: (312) 828-1549
Facsimile: (312) 987-1276
ADMINISTRATIVE AGENT'S PAYMENT OFFICE
- -------------------------------------
Bank of America National Trust
and Savings Association
Agency Management Services #5596
1850 Gateway Boulevard, 5th Floor
Concord, CA 94520
ABA No. 121-000-358
For Credit to Account No.: 12336-17053
Ref: AptarGroup, Inc.
<PAGE>
BANK OF AMERICA NATIONAL TRUST
- ------------------------------
AND SAVINGS ASSOCIATION,
- -----------------------
As a Lender
Domestic and Offshore Lending Office:
Bank of America National Trust
and Savings Association
200 West Jackson Boulevard, 9th Floor
Chicago, IL 60606
Attention: Pamela Scarborough
Telephone: (312) 828-3852
Facsimile: (312) 974-9626
Notices (other than Borrowing Notices and Notices of Conversion/Continuation):
Bank of America National Trust
and Savings Association
231 S. LaSalle Street
Chicago, IL 60201
Attention: M.H. Claggett, Vice President
Telephone: (312) 828-1549
Facsimile: (312) 987-1276
ABN AMRO BANK N.V.
- ------------------
Domestic and Offshore Lending Office:
208 South LaSalle, Suite 1500
Chicago, IL 60604-1003
Attention: Credit Administration
Telephone: (312) 992-5110
Facsimile: (312) 992-5111
Notices (other than Borrowing Notices and Notices of Conversion/Continuation):
ABN AMRO Bank N.V.
135 South LaSalle Street, Suite 625
Chicago, IL 60603
Attention: Bernard McGuigan
Telephone: (312) 904-2664
Facsimile: (312) 904-1110
<PAGE>
SOCIETE GENERALE - CHICAGO BRANCH
- ---------------------------------
181 West Madison
Chicago, IL 60602
Attention: Michael Lincoln, Director
Telephone: (312) 578-5056
Facsimile: (312) 578-5099
Notices (other than Borrowing Notices and Notices of Conversion/Continuation):
181 West Madison
Chicago, IL 60602
Attention: Michael Lincoln, Director
Telephone: (312) 578-5056
Facsimile: (312) 578-5099
FLEET NATIONAL BANK
- -------------------
Domestic and Offshore Lending Office:
850 Main Street
Bridgeport, CT 06604
Attention:
Telephone:
Facsimile:
Notices (other than Borrowing Notices and Notices of Conversion/Continuation):
Mail Stop CT FD KO2A
One Landmark Square
Second Floor
Stamford, CT 06901
Attention: H. Frazier Caner
Telephone: (203) 964-4884
Facsimile: (203) 964-4851
APTARGROUP, INC.
- ----------------
AptarGroup, Inc.
475 West Terra Cotta Avenue
Suite E
Crystal Lake, IL 60014
<PAGE>
Attention: Vice President-Risk Management
Facsimile: (815) 477-0481
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<CIK> 0000896622
<NAME> APTARGROUP, INC.
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-START> JAN-01-1999
<PERIOD-END> JUN-30-1999
<EXCHANGE-RATE> 1.0
<CASH> 32,631
<SECURITIES> 0
<RECEIVABLES> 181,399
<ALLOWANCES> (6,051)
<INVENTORY> 104,902
<CURRENT-ASSETS> 344,068
<PP&E> 686,001
<DEPRECIATION> (342,964)
<TOTAL-ASSETS> 831,718
<CURRENT-LIABILITIES> 149,320
<BONDS> 226,842
0
0
<COMMON> 399
<OTHER-SE> 410,367
<TOTAL-LIABILITY-AND-EQUITY> 831,718
<SALES> 407,087
<TOTAL-REVENUES> 407,087
<CGS> 253,975
<TOTAL-COSTS> 354,508
<OTHER-EXPENSES> 100,533
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> (6,412)
<INCOME-PRETAX> 47,091
<INCOME-TAX> 16,642
<INCOME-CONTINUING> 30,449
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 30,449
<EPS-BASIC> 0.84<F1>
<EPS-DILUTED> 0.82
<FN>
<F1>In August 1998, the Company effected a two-for-one stock split. Prior Financial
Data Schedules have not been restated for this stock split.
</FN>
</TABLE>
