Commission File No. 1-804
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-A
FOR REGISTRATION OF CERTAIN CLASSES OF SECURITIES
PURSUANT TO SECTION 12(b) OR (g) OF THE
SECURITIES EXCHANGE ACT OF 1934
SEQUA CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 13-1885030
(State of Incorporation) (I.R.S. Employer
Identification No.)
200 Park Avenue
New York, New York 10166
(Address of principal executive offices)
Securities to be registered pursuant to Section 12(b) of the Act:
Title of each Name of each exchange
class to be so on which each class
registered____ is to be registered
9-5/8% Notes, Due October 15, 1999 New York Stock Exchange
8-3/4% Senior Notes, Due December 15, 2001 New York Stock Exchange
9-3/8% Senior Subordinated Notes, New York Stock Exchange
Due December 5, 2003
Securities to be registered pursuant to Section 12(g) of the Act: NONE.
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Item 1. Description of Registrant's Securities to be Registered:
A description of the Registrant's 9-5/8% Notes, due October 15, 1999, to
be registered hereby is contained on pages S-2 through S-5 of the Pro-
spectus Supplement dated October 19, 1989 (filed as exhibit 4.9 hereto),
and pages 6 through 12 of the Prospectus dated September 21, 1989 (filed
as exhibit 4.8 hereto), relating to the Registration Statement on Form
S-3, No. 33-30959, and such descriptions are incorporated herein by
reference.
A description of the Registrant's 8-3/4% Senior Notes, due December 15,
2001, to be registered hereby is contained on page 5 and pages 46
through 68 of the Prospectus dated December 16, 1993 (filed as exhibit
4.10 hereto), relating to the Registration Statement on Form S-1, No.
33-50843, and such descriptions are incorporated herein by reference.
A description of the Registrant's 9-5/8% Senior Subordinated Notes, due
December 15, 2003, to be registered hereby is contained on pages 6
through 7 and pages 46 through 68 of the Prospectus dated December 16,
1993 (filed as exhibit 4.11), relating to the Amendment No. 3 to the
Registration Statement on Form S-1, No. 33-50843, and such descriptions
are incorporated herein by reference.
Item 2. Exhibits.
The exhibits in parentheses below, on file with the Securities and
Exchange Commission, are incorporated herein by reference as exhibits
hereto.
Exhibit
Number Description
4.1 Form of 9-5/8% Note due October 15, 1999 of Sequa
Corporation.*
4.2 Form of 8-3/4% Senior Note due December 15, 2001 of Sequa
Corporation.*
4.3 Form of 9-3/8% Senior Subordinated Note due December 15,
2003 of Sequa Corporation.*
4.4 Indenture, dated as of September 1, 1989 by and between
Sequa Corporation and The First National Bank of Chicago, as
Trustee. (Exhibit 4.1 to Registration Statement on Form
S-3, filed on September 12, 1989, No. 33-30959).
4.5 First Supplemental Indenture, dated as of October 15, 1989
by and between Sequa Corporation and The First National Bank
of Chicago, as Trustee.*
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4.6 Indenture, dated as of December 15, 1993 by and between
Sequa Corporation and IBJ Schroder Bank & Trust Company, as
Trustee.*
4.7 Indenture, dated as of December 15, 1993 by and between
Sequa Corporation and Bankers Trust Company, as Trustee.*
4.8 Pages 6 through 12 of the Prospectus dated September 21,
1989 (filed on September 12, 1989, as part of the Registra-
tion Statement on Form S-3, No. 33-30959).
4.9 Pages S-2 through S-5 of the Prospectus Supplement dated
October 19, 1989 (filed pursuant to Rule 424(b)(2) on
October 20, 1989, relating to the Registration Statement on
Form S-3, No. 33-30959).
4.10 Page 5 and pages 46 through 68 of the Prospectus dated
December 16, 1993 (filed on December 16, 1993, as part of
Amendment No. 3 to the Registration Statement on Form S-1,
No. 33-50843).
4.11 Pages 6 through 7 and pages 46 through 68 of the Prospectus
dated December 16, 1993 (filed on December 16, 1993, as part
of Amendment No. 3 to the Registration Statement on Form
S-1, No. 33-50843).
_________________________
* Filed herewith.
<PAGE>
SIGNATURE
Pursuant to the requirements of Section 12 of the Securities Exchange Act of
1934, the Registrant has duly caused this Registration Statement to be signed
on its behalf by the undersigned, thereto duly authorized, this 25th day of
January, 1994.
SEQUA CORPORATION
By: /s/ Kenneth A. Drucker
Kenneth A. Drucker
Vice President and Treasurer
Exhibit 4.1
[FORM OF FACE OF SECURITY]
SEQUA CORPORATION
9-5/8% NOTE DUE OCTOBER 15, 1999
$ CUSIP No. 817320 AD 6
SEQUA CORPORATION, a corporation duly organized and
existing under the laws of the State of Delaware (herein called
the "Company", which term includes any successor corporation
under the Indenture hereinafter referred to), for value
received, hereby promises to pay to
, or registered
assigns, the principal sum of Dollars on
October 15, 1999, and to pay interest thereon from October 15,
1989 or from the most recent Interest Payment Date to which
interest has been paid or duly provided for, semi-annually on
April 15 and October 15 in each year, commencing April 15,
1990, at the rate of 9-5/8% per annum, until the principal
hereof is paid or made available for payment. The interest so
payable, and punctually paid or duly provided for, on any
Interest Payment Date will, as provided in such Indenture, be
paid to the Person in whose name this Security (or one or more
Predecessor Securities) is registered at the close of business
on the Regular Record Date for such interest, which shall be
the March 31 or September 30 (whether or not a Business Day),
as the case may be, next preceding such Interest Payment Date.
Any such interest not so punctually paid or duly provided for
will forthwith cease to be payable to the Holder on such Regu-
lar Record Date and may either be paid to the Person in whose
name this Security (or one or more Predecessor Securities) is
registered at the close of business on a Special Record Date
for the payment of such Defaulted Interest to be fixed by the
Trustee, notice whereof shall be given to Holders of Securities
of this series not less than 10 days prior to such Special
Record Date, or be paid at any time in any other lawful manner
not inconsistent with the requirements of any securities
exchange on which the Securities of this series may be listed,
and upon such notice as may be required by such exchange, all
as more fully provided in said Indenture.
Payment of the principal of and interest on this
Security will be made at the office or agency of the Company
maintained for that purpose in the Borough of Manhattan, the
City and State of New York, in such coin or currency of the
United States of America as at the time of payment is legal
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tender for payment of public and private debts; provided, how-
ever, that at the option of the Company payment of interest may
be made by check mailed to the address of the Person entitled
thereto as such address shall appear in the Security Register.
Reference is hereby made to the further provisions of
this Security set forth on the reverse hereof, which further
provisions shall for all purposes have the same effect as if
set forth at this place.
Unless the certificate of authentication hereon has
been executed by the Trustee referred to on the reverse hereof
by manual signature, this Security shall not be entitled to any
benefit under the Indenture or be valid or obligatory for any
purpose.
IN WITNESS WHEREOF, Sequa Corporation has caused this
Security to be signed by its Chairman of the Board, or its
President, or one of its Vice Presidents, manually or in fac-
simile, and a facsimile of its corporate seal to be imprinted
hereon.
Dated:
[CORPORATE SEAL]
SEQUA CORPORATION
By: ________________________
Attest:
___________________________
[FORM OF REVERSE OF SECURITY]
This Security is one of a duly authorized issue of
securities of the Company (herein called the "Securities"),
issued and to be issued in one or more series under an Inden-
ture, Dated as of September 1, 1989 (herein called the "Inden-
ture"), between the Company and The First National Bank of Chi-
cago, Trustee (herein called the "Trustee", which term includes
any successor trustee under the Indenture with respect to the
series of which this Security is a part), to which Indenture
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and all indentures supplemental thereto reference is hereby
made for a statement of the respective rights, limitations of
rights, duties and immunities thereunder of the Company, the
Trustee and the Holders of the Securities and of the terms upon
which the Securities are, and are to be, authenticated and
delivered. Certain particular terms and conditions of the
Securities of this series are set forth in a First Supplemental
Indenture, Dated as of October 15, 1989 (the "Supplement"),
between the Company and the Trustee. This Security is one of
the series designated on the face hereof, limited in aggregate
principal amount to $150,000,000.
Upon the occurrence of both a Designated Event (as
defined in the Supplement) and a Rating Decline (as defined in
the Supplement), each Holder of Securities of this series shall
have the right, at its option, to tender to the Company all or
part of the Securities of this series held by such Holder, and
the Company shall either (i) elect to repurchase such Securi-
ties at 100% of the principal amount thereof, plus any accrued
interest to the Repurchase Date (as defined in the Supplement)
or (ii) elect not to repurchase such Securities, in which case,
on and after the date of such Rating Decline, all of the Secu-
rities of this series (whether or not tendered) will bear
interest at an interest rate per annum equal to the greater of
(A) the interest rate per annum in effect immediately prior to
such Rating Decline and (B) the interest rate per annum, as
determined by a Reset Advisor (as defined in the Supplement)
selected by the Company, which, in the Reset Advisor's opinion,
would (in the absence of the tender right described in this
paragraph) have resulted in the market value of the Securities
of this series being 100% of their principal amount as of the
close of business on the Reset Date (as defined in the Supple-
ment); provided, however, that if the interest rate determined
by the Reset Advisor pursuant to clause (ii)(B) of this para-
graph shall exceed the maximum rate permitted under applicable
law, then the Company shall be deemed to have elected to repur-
chase the tendered Securities pursuant to clause (i) of this
paragraph on the Repurchase Date. The Company is obligated to
provide notice to each Holder of Securities of this series that
both a Designated Event and a Rating Decline have occurred and
of the Repurchase Date and the Reset Date.
The Securities of this series are subject to the
defeasance and covenant defeasance provisions set forth in
Article Fourteen of the Indenture. In the event the Company
elects covenant defeasance with respect to the Securities of
this series, the Company will be released from its obligations
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relating to the tender right discussed in the preceding para-
graph, and any omission to comply with such obligations shall
not constitute a default or an Event of Default with respect to
such Securities.
If an Event of Default with respect to Securities of
this series shall occur and be continuing, the principal of the
Securities of this series may be declared due and payable in
the manner and with the effect provided in the Indenture.
The Indenture permits, with certain exceptions as
therein provided, the amendment thereof and the modification of
the rights and obligations of the Company and the rights of the
Holders of the Securities of each series to be affected under
the Indenture at any time by the Company and the Trustee with
the consent of the Holders of not less than 66 2/3% in princi-
pal amount of the Outstanding Securities of each series to be
affected. The Indenture also contains provisions permitting
the Holders of specified percentages in principal amount of the
Outstanding Securities of each series, on behalf of the Holders
of all Outstanding Securities of such series, to waive compli-
ance by the Company with certain provisions of the Indenture
and certain past defaults under the Indenture and their conse-
quences. Any such consent or waiver by the Holder of this
Security shall be conclusive and binding upon such Holder and
upon all future Holders of this Security and of any Security
issued upon the registration of transfer hereof or in exchange
or in lieu hereof, whether or not notation of such consent or
waiver is made upon this Security.
No reference herein to the Indenture and no provision
of this Security or of the Indenture shall alter or impair the
obligation of the Company, which is absolute and unconditional,
to pay the amount of principal of and interest on this Security
herein provided, and at the times, place and rate, and in the
coin or currency, herein prescribed.
As provided in the Indenture and subject to certain
limitations therein set forth, the transfer of this Security is
registrable in the Security Register, upon surrender of this
Security for registration of transfer at the office or agency
of the Company in any place where the principal of and interest
on this Security are payable, duly endorsed by, or accompanied
by a written instrument of transfer in form satisfactory to the
Company and the Security Registrar duly executed by, the Holder
hereof or his attorney duly authorized in writing, and there-
upon one or more new Securities of this series, of authorized
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denominations and for the same aggregate principal amount, will
be issued to the designated transferee or transferees.
The Securities of this series are issuable only in
registered form without coupons in denominations of $1,000 and
any integral multiple thereof. As provided in the Indenture
and subject to certain limitations therein set forth, Securi-
ties of this series are exchangeable for a like aggregate prin-
cipal amount of Securities of this series of different autho-
rized denominations as requested by the Holder surrendering the
same.
No service charge shall be made for any such regis-
tration of transfer or exchange, but the Company may require
payment of a sum sufficient to cover any tax or other govern-
mental charge payable in connection therewith.
Prior to due presentment of this Security for regis-
tration of transfer, the Company, the Trustee and any agent of
the Company or the Trustee may treat the Person in whose name
this Security is registered as the owner hereof for all pur-
poses, whether or not this Security be overdue, and neither the
Company, the Trustee nor any such agent shall be affected by
notice to the contrary.
All terms used in this Security which are defined in
the Indenture shall have the meanings assigned to them in the
Indenture.
[FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION]
This is one of the Securities of the series desig-
nated therein referred to in the within-mentioned Indenture.
The First National Bank of Chicago,
As Trustee
By: __________________________________
Authorized Officer
Exhibit 4.2
[FORM OF FACE OF NOTE]
CUSIP NO. 817320 AF 1
$________
Sequa Corporation
8-3/4% Senior Note Due December 15, 2001
Sequa Corporation, a Delaware corporation (the "Com-
pany", which term includes any successor corporation under the
Indenture hereinafter referred to), promises to pay to ________
or registered assigns, the principal amount of ________ Dollars
on December 15, 2001.
Interest Payment Dates; June 15 and December 15, com-
mencing June 15, 1994.
Record Dates: June 1 and December 1.
Reference is hereby made to the further provisions of
this Security set forth on the reverse hereof which further
provisions shall for all purposes have the same effect as if
set forth at this place.
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IN WITNESS WHEREOF, the Company has caused this
Security to be signed manually or by facsimile by its duly
authorized officers and a facsimile of its corporate seal to be
affixed hereto or imprinted hereon.
SEQUA CORPORATION
By____________________________
Name:
Title:
[SEAL] Attest:
By____________________________
Name:
Title:
Dated:___________________
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the 8-3/4% Senior Notes Due December 15, 2001
described in the within-mentioned Indenture.
IBJ SCHRODER BANK & TRUST COMPANY, as trustee
By___________________________________________
Authorized Officer
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<PAGE>
[FORM OF REVERSE SIDE OF NOTE]
8-3/4% Senior Note Due December 15, 2001
1. Interest
Sequa Corporation, a Delaware corporation (the "Com-
pany"), promises to pay interest on the principal amount of
this Security at the rate per annum shown above. Interest will
be payable semi-annually on each interest payment date, com-
mencing June 15, 1994. Interest on this Security will accrue
from the most recent date to which interest has been paid, or
if no interest has been paid, from December 22, 1993. Interest
will be computed on the basis of a 360-day year of twelve
30-day months.
The Company shall pay interest on overdue principal
and interest on overdue installments of interest, to the extent
lawful, at the rate per annum borne by the Securities.
2. Method of Payment
The Company will pay interest on this Security
(except defaulted interest) to the persons who are registered
Holders at the close of business on June 1 and December 1 imme-
diately preceding the interest payment date even if the Secu-
rity is cancelled on registration of transfer or registration
of exchange (other than with respect to the purchase of Securi-
ties pursuant to an offer to purchase Securities made in con-
nection with Section 4.15 or 4.16 of the Indenture after such
record date). Holders must surrender this Security to a Paying
Agent to collect principal payments. The Company will pay
principal, premium, if any, and interest in money of the United
States that at the time of payment is legal tender for payment
of public and private debts. However, the Company may pay
principal and interest by its check payable in such money. It
may mail an interest payment to a Securityholder's registered
address.
3. Paying Agent and Registrar
Initially, the Trustee will act as Paying Agent and
Registrar. The Company may appoint and change any Paying Agent
or Registrar without notice, other than notice to the Trustee.
The Company or any Subsidiary or an Affiliate of either of them
may act as Paying Agent, Registrar or coregistrar.
4. Indenture
The Company issued the Securities under an Indenture,
dated as of December 15, 1993 (the "Indenture"), between the
Company and the Trustee. The terms of the Securities include
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<PAGE>
those stated in the Indenture and those made part of the Inden-
ture by reference to the Trust Indenture Act of 1939, as
amended and as in effect on the date of the Indenture (the
"TIA") and as provided in the Indenture. Capitalized terms
used herein and not defined herein have the meanings ascribed
thereto in the Indenture. The Securities are subject to all
such terms, and Securityholders are referred to the Indenture
and the TIA for a statement of those terms. The Securities are
general obligations of the Company limited to $125,000,000
aggregate principal amount except as provided in Section 2.07
of the Indenture.
5. Optional Redemption
The Securities are redeemable as a whole, or from
time to time in part, at any time on and after December 15,
1997 at the option of the Company at the following Redemption
Prices (expressed as percentages of principal) together with
accrued and unpaid interest to the Redemption Date if redeemed
in the twelve-month period commencing on December 15 of the
years indicated below:
Year Percentage
1997........................... 104.3750%
1998........................... 102.1875
1999 and thereafter............ 100.0000
In addition to the optional redemption of the Secu-
rities provided for above, on or prior to December 15, 1996,
the Company may redeem up to 20% of the principal amount of the
Securities originally issued under the Indenture with the net
proceeds of a Public Equity Offering at a redemption price
equal to 108.750% of the principal amount of the Securities to
be redeemed plus accrued and unpaid interest to the Redemption
Date; provided, however, that at least 80% of the principal
amount of the Securities originally issued under the Indenture
remains outstanding immediately after the occurrence of such
redemption; provided, further, that such redemption shall occur
within 45 days after the date of the closing of the Public
Equity Offering; and provided, further, that the Trustee shall
receive notice of such redemption at least 15 days before
notices are mailed.
6. Notice of Redemption
Notice of redemption will be mailed at least 30 days
but not more than 60 days before the Redemption Date to each
Holder of Securities to be redeemed at the Holder's registered
address. Securities in denominations larger than $1,000 of
principal amount may be redeemed in part but only in integral
multiples of $1,000 of principal amount.
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7. Requirement that the Company Offer to Purchase
Securities under Certain Circumstances
(a) Subject to the terms and conditions of the
Indenture, in the event of a Change of Control, the Company
will be required to commence within 30 days following the date
upon which the Change of Control occurred an offer to all Hold-
ers to purchase all or any portion of the principal amount of
the Securities originally issued at a purchase price equal to
101% of the aggregate principal amount of the Securities plus
accrued interest to the Change of Control Payment Date.
(b) In the event that the Company or any Restricted
Subsidiary shall consummate an Asset Sale where the aggregate
amount of Senior Excess Proceeds exceeds $20 million, the Com-
pany shall make an offer to all Securityholders pursuant to the
provisions of Section 4.16 of the Indenture to purchase the
maximum principal amount of Securities that may be purchased
out of the Senior Excess Proceeds at a purchase price equal to
100% of the principal amount thereof plus accrued and unpaid
interest, if any, to the date fixed for the closing of such
offer.
8. Denominations; Transfer; Exchange
The Securities are in registered form, without cou-
pons, in denominations of $1,000 of principal amount and inte-
gral multiples of $1,000. A Holder may transfer or exchange
Securities in accordance with the Indenture. The Registrar may
require a Holder, among other things, to furnish appropriate
endorsements and transfer documents and to pay any taxes and
fees required by law or permitted by the Indenture. The Regis-
trar need not transfer or exchange any Securities selected for
redemption (except, in the case of a Security to be redeemed in
part, the portion of the Security not to be redeemed) or any
Securities for a period of 15 days before a selection of Secu-
rities to be redeemed.
9. Persons Deemed Owners
The registered Holder of this Security may be
treated as the owner of this Security for all purposes.
10. Amendment; Waiver
Subject to certain exceptions set forth in the Inden-
ture, (i) the Indenture or the Securities may be amended with
the written consent of the Holders of at least a majority in
aggregate principal amount of the Securities at the time out-
standing and (ii) certain defaults or noncompliance with cer-
tain provisions may be waived with the written consent of the
Holders of a majority in aggregate principal amount of the
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Securities at the time outstanding. Subject to certain excep-
tions set forth in the Indenture, without the consent of any
Securityholder, the Company and the Trustee may amend the
Indenture or the Securities to cure any ambiguity, defect or
inconsistency, or to comply with Article 5 of the Indenture, or
to provide for uncertificated Securities in addition to certif-
icated Securities, or to comply with any requirements of the
Securities and Exchange Commission in connection with the
qualification of the Indenture under the TIA, or to make any
change that does not adversely affect the rights of any
Securityholder.
11. Defaults and Remedies
Under the Indenture, Events of Default include (i)
default in payment of the principal amount, premium, if any, or
interest, in respect of the Securities when the same becomes
due and payable subject, in the case of interest, to the grace
period contained in the Indenture; (ii) failure by the Company
or any Subsidiary to comply with the terms of the Indenture
governing mergers, consolidations and sale of substantially all
of the assets of the Company; (iii) failure by the Company to
comply with other agreements in the Indenture or the Securi-
ties, subject to notice and lapse of time; (iv) certain events
of acceleration prior to maturity of certain indebtedness and
payment defaults at stated maturity (after applicable grace
periods) of certain indebtedness; (v) certain final judgments
which remain undischarged; and (vi) certain events of bank-
ruptcy or insolvency with respect to the Company or any
Restricted Subsidiary. If an Event of Default occurs and is
continuing, the Trustee, or the Holders of at least 25% in
aggregate principal amount of the Securities at the time out-
standing, may declare all the Securities to be due and payable
immediately. Certain events of bankruptcy or insolvency are
Events of Default which will result in the Securities becoming
due and payable immediately upon the occurrence of such Events
of Default.
Securityholders may not enforce the Indenture or the
Securities except as provided in the Indenture. The Trustee
may refuse to enforce the Indenture or the Securities unless it
receives reasonable indemnity or security. Subject to certain
limitations, Holders of a majority in aggregate principal
amount of the Securities at the time outstanding may direct the
Trustee in its exercise of any trust or power. The Trustee may
withhold from Securityholders notice of any continuing Default
(except a Default in payment of amounts specified in clause (i)
above) if it determines that withholding notice is in their
interests.
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12. Trustee Dealings with the Company
Subject to certain limitations imposed by the TIA,
the Trustee under the Indenture, in its individual or any other
capacity, may become the owner or pledgee of Securities and may
otherwise deal with and collect obligations owed to it by the
Company or its Affiliates and may otherwise deal with the Com-
pany or its Affiliates with the same rights it would have if it
were not Trustee.
13. No Recourse Against Others
A director, officer, employee or stockholder, as
such, of the Company shall not have any liability for any obli-
gations of the Company under the Securities or the Indenture or
for any claim based on, in respect of or by reason of such
obligations or their creation. By accepting a Security, each
Securityholder waives and releases all such liability. The
waiver and release are part of the consideration for the issue
of the Securities.
14. Authentication
This Security shall not be valid until an authorized
Officer of the Trustee manually signs the Trustee's Certificate
of Authentication on the other side of this Security.
15. Abbreviations
Customary abbreviations may be used in the name of a
Securityholder or an assignee, such as TEN COM (=tenants in
common), TEN ENT (=tenants by the entirety), JT TEN (=joint
tenants with right of survivorship and not as tenants in com-
mon), CUST (=custodian), and U/G/M/A (=Uniform Gift to Minors
Act).
16. Unclaimed Money
If money for the payment of principal or interest
remains unclaimed for two years, the Trustee or Paying Agent
will pay the money back to the Company at its written request.
After that, Holders entitled to money must look to the Company
for payment.
17. Discharge Prior to Maturity
If the Company deposits with the Trustee or Paying
Agent money or U.S. Government Obligations sufficient to pay
the principal of and interest on the Securities to maturity or
redemption, as the case may be, the Company will be discharged
from the Indenture except for certain Sections thereof.
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18. Successor
When a successor Person to the Company assumes all
the obligations of its predecessor under the Securities and the
Indenture, such predecessor shall be released from those obli-
gations.
19. Governing Law
THE INDENTURE AND THIS SECURITY SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW
YORK, AS APPLIED TO CONTRACTS MADE AND PERFORMED WITHIN THE
STATE OF NEW YORK WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF
LAWS. IF ANY ACTION OR PROCEEDING SHALL BE BROUGHT BY THE
TRUSTEE OR BY A HOLDER OF ANY OF THE SECURITIES IN ORDER TO
ENFORCE ANY RIGHT OR REMEDY UNDER THE INDENTURE OR UNDER THE
SECURITIES, THE COMPANY HEREBY CONSENTS AND SUBMITS TO THE
JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK AND OF ANY
FEDERAL COURT SITTING IN THE CITY OF NEW YORK, STATE OF NEW
YORK. ANY ACTION OR PROCEEDING BROUGHT BY THE COMPANY TO
ENFORCE ANY RIGHT, ASSERT ANY CLAIM OR OBTAIN ANY RELIEF WHAT-
SOEVER IN CONNECTION WITH THE INDENTURE OR THE SECURITIES SHALL
BE BROUGHT BY THE COMPANY EXCLUSIVELY IN THE COURTS OF THE
STATE OF NEW YORK OR IN ANY FEDERAL COURT SITTING IN THE CITY
OF NEW YORK, STATE OF NEW YORK.
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ASSIGNMENT FORM
To assign this Security, fill in the form below: (I)
or (we) assign and transfer this Security to:
_______________________________________________________________
(insert assignee's social security or tax I.D. number)
_______________________________________________________________
_______________________________________________________________
_______________________________________________________________
_______________________________________________________________
(print or type assignee's name, address and zip code)
and irrevocably appoint ______________________________ agent to
transfer this Security on the books of the Company. The agent
may substitute another to act for him.
Dated:______________ Signature:_______________________
(Sign exactly as your
name appears on the
face of this Security)
Signature
Guarantee:_____________________________________________________
OPTION OF HOLDER TO ELECT PURCHASE
If you wish to elect to have all or any portion of
this Security purchased by the Company pursuant to an "Offer"
in accordance with the provisions of Section 3.03 which are
required by Section 4.15 ("Repurchase Upon Change in Control")
or Section 4.16 ("Limitation on Asset Sales") check the appli-
cable boxes:
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___ ___
/__/ Section 4.15: /__/ Section 4.16:
___ ___
in whole /__/ in whole /__/
___ ___
in part /__/ (unpurchased in part /__/ (unpurchased
portion must be equal to portion must be equal to
$1,000 in principal amount $1,000 in principal amount
or an integral multiple or an integral multiple
thereof) thereof)
amount to be amount to be
purchased: $ ________ purchased: $ __________
Dated:_____________________ Signature:____________________
(Sign exactly as your
name appears on the face
of this Security)
Signature
Guarantee:_____________________________________________________
Social Security Number or
Taxpayer Identification Number:________________________________
A-10
Exhibit 4.3
[FORM OF FACE OF NOTE]
CUSIP NO. 817320 AG 9
$________
Sequa Corporation
9-3/8% Senior Subordinated Note Due December 15, 2003
Sequa Corporation, a Delaware corporation (the
"Company", which term includes any successor corporation under
the Indenture hereinafter referred to), promises to pay to
________ or registered assigns, the principal amount of
________ Dollars on December 15, 2003.
Interest Payment Dates; June 15 and December 15,
commencing June 15, 1994.
Record Dates: June 1 and December 1.
Reference is hereby made to the further provisions of
this Security set forth on the reverse hereof which further
provisions shall for all purposes have the same effect as if
set forth at this place.
<PAGE>
IN WITNESS WHEREOF, the Company has caused this
Security to be signed manually or by facsimile by its duly
authorized officers and a facsimile of its corporate seal to be
affixed hereto or imprinted hereon.
SEQUA CORPORATION
By____________________________
Name:
Title:
[SEAL] Attest:
By____________________________
Name:
Title:
Dated:___________________
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the 9-3/8% Senior Subordinated Notes Due
December 15, 2003 described in the within-mentioned Indenture.
BANKERS TRUST COMPANY, as trustee
By______________________
Authorized Signatory
A-2
<PAGE>
[FORM OF REVERSE SIDE OF NOTE]
9-3/8% Senior Subordinated Note Due December 15, 2003
1. Interest
Sequa Corporation, a Delaware corporation (the
"Company"), promises to pay interest on the principal amount of
this Security at the rate per annum shown above. Interest will
be payable semi-annually on each interest payment date,
commencing June 15, 1994. Interest on this Security will
accrue from the most recent date to which interest has been
paid, or if no interest has been paid, from December 22, 1993.
Interest will be computed on the basis of a 360-day year of
twelve 30-day months.
The Company shall pay interest on overdue principal
and interest on overdue installments of interest, to the extent
lawful, at the rate per annum borne by the Securities.
2. Method of Payment
The Company will pay interest on this Security
(except defaulted interest) to the persons who are registered
Holders at the close of business on June 1 and December 1
immediately preceding the interest payment date even if the
Security is cancelled on registration of transfer or
registration of exchange (other than with respect to the
purchase of Securities pursuant to an offer to purchase
Securities made in connection with Section 4.15 or 4.16 of the
Indenture after such record date). Holders must surrender this
Security to a Paying Agent to collect principal payments. The
Company will pay principal, premium, if any, and interest in
money of the United States that at the time of payment is legal
tender for payment of public and private debts. However, the
Company may pay principal and interest by its check payable in
such money. It may mail an interest payment to a
Securityholder's registered address.
3. Paying Agent and Registrar
Initially, the Trustee will act as Paying Agent and
Registrar. The Company may appoint and change any Paying Agent
or Registrar without notice, other than notice to the Trustee.
The Company or any Subsidiary or an Affiliate of either of them
may act as Paying Agent, Registrar or coregistrar.
4. Indenture
The Company issued the Securities under an Indenture,
dated as of December 15, 1993 (the "Indenture"), between the
Company and the Trustee. The terms of the Securities include
A-3
<PAGE>
those stated in the Indenture and those made part of the
Indenture by reference to the Trust Indenture Act of 1939, as
amended and as in effect on the date of the Indenture (the
"TIA") and as provided in the Indenture. Capitalized terms
used herein and not defined herein have the meanings ascribed
thereto in the Indenture. The Securities are subject to all
such terms, and Securityholders are referred to the Indenture
and the TIA for a statement of those terms. The Securities are
general obligations of the Company limited to $175,000,000
aggregate principal amount except as provided in Section 2.07
of the Indenture.
5. Optional Redemption
The Securities are redeemable as a whole, or from
time to time in part, at any time on and after December 15,
1998 at the option of the Company at the following Redemption
Prices (expressed as percentages of principal) together with
accrued and unpaid interest to the Redemption Date if redeemed
in the twelve-month period commencing on December 15 of the
years indicated below:
Year Percentage
1998 . . . . . . . . . . . . . . . . . . 104.6875%
1999 . . . . . . . . . . . . . . . . . . 103.1250
2000 . . . . . . . . . . . . . . . . . . 101.5625
2001 and thereafter. . . . . . . . . . . 100.0000
In addition to the optional redemption of the
Securities provided for above, on or prior to December 15,
1996, the Company may redeem up to 35% of the principal amount
of the Securities originally issued under the Indenture with
the net proceeds of a Public Equity Offering at a redemption
price equal to 109.375% of the principal amount of the
Securities to be redeemed plus accrued and unpaid interest to
the Redemption Date; provided, however, that at least 65% of
the principal amount of the Securities originally issued under
the Indenture remains outstanding immediately after the
occurrence of such redemption; provided, further, that such
redemption shall occur within 45 days after the date of the
closing of the Public Equity Offering; and provided, further,
that the Trustee shall receive notice of such redemption at
least 15 days before notices are mailed.
6. Notice of Redemption
Notice of redemption will be mailed at least 30 days
but not more than 60 days before the Redemption Date to each
Holder of Securities to be redeemed at the Holder's registered
address. Securities in denominations larger than $1,000 of
A-4
<PAGE>
principal amount may be redeemed in part but only in integral
multiples of $1,000 of principal amount.
7. Requirement that the Company Offer to Purchase
Securities under Certain Circumstances
(a) Subject to the terms and conditions of the
Indenture, in the event of a Change of Control, the Company
will be required to commence within 30 days following the date
upon which the Change of Control occurred an offer to all
Holders to purchase all or any portion of the principal amount
of the Securities originally issued at a purchase price equal
to 101% of the aggregate principal amount of the Securities
plus accrued interest to the Change of Control Payment Date.
(b) In the event that the Company or any Restricted
Subsidiary shall consummate an Asset Sale where the aggregate
amount of Senior Subordinated Excess Proceeds exceeds $20
million, the Company shall make an offer to all Securityholders
pursuant to the provisions of Section 4.16 of the Indenture to
purchase the maximum principal amount of Securities that may be
purchased out of the Senior Subordinated Excess Proceeds at a
purchase price equal to 100% of the principal amount thereof
plus accrued and unpaid interest, if any, to the date fixed for
the closing of such offer.
8. Subordination
The Securities are subordinated to Senior Debt (as
defined in the Indenture). To the extent provided in the
Indenture, Senior Debt must be paid before the Securities may
be paid. The Company agrees, and each Securityholder by
accepting a Security consents and agrees, to such subordination
and authorizes the Trustee to give it effect.
9. Denominations; Transfer; Exchange
The Securities are in registered form, without
coupons, in denominations of $1,000 of principal amount and
integral multiples of $1,000. A Holder may transfer or
exchange Securities in accordance with the Indenture. The
Registrar may require a Holder, among other things, to furnish
appropriate endorsements and transfer documents and to pay any
taxes and fees required by law or permitted by the Indenture.
The Registrar need not transfer or exchange any Securities
selected for redemption (except, in the case of a Security to
be redeemed in part, the portion of the Security not to be
redeemed) or any Securities for a period of 15 days before a
selection of Securities to be redeemed.
A-5
<PAGE>
10. Persons Deemed Owners
The registered Holder of this Security may be treated
as the owner of this Security for all purposes.
11. Amendment; Waiver
Subject to certain exceptions set forth in the
Indenture, (i) the Indenture or the Securities may be amended
with the written consent of the Holders of at least a majority
in aggregate principal amount of the Securities at the time
outstanding and (ii) certain defaults or noncompliance with
certain provisions may be waived with the written consent of
the Holders of a majority in aggregate principal amount of the
Securities at the time outstanding. Subject to certain
exceptions set forth in the Indenture, without the consent of
any Securityholder, the Company and the Trustee may amend the
Indenture or the Securities to cure any ambiguity, defect or
inconsistency, or to comply with Article 5 of the Indenture, or
to provide for uncertificated Securities in addition to
certificated Securities, or to comply with any requirements of
the Securities and Exchange Commission in connection with the
qualification of the Indenture under the TIA, or to make any
change that does not adversely affect the rights of any
Securityholder.
12. Defaults and Remedies
Under the Indenture, Events of Default include (i)
default in payment of the principal amount, premium if any, or
interest (whether or not prohibited by the subordination
provisions of the Indenture), in respect of the Securities when
the same becomes due and payable subject, in the case of
interest, to the grace period contained in the Indenture; (ii)
failure by the Company or any Subsidiary to comply with the
terms of the Indenture governing mergers, consolidations and
sale of substantially all of the assets of the Company; (iii)
failure by the Company to comply with other agreements in the
Indenture or the Securities, subject to notice and lapse of
time; (iv) certain events of acceleration prior to maturity of
certain indebtedness and payment defaults at stated maturity
(after applicable grace periods) of certain indebtedness; (v)
certain final judgments which remain undischarged; and (vi)
certain events of bankruptcy or insolvency with respect to the
Company or any Restricted Subsidiary. If an Event of Default
occurs and is continuing, the Trustee, or the Holders of at
least 25% in aggregate principal amount of the Securities at
the time outstanding, may declare all the Securities to be due
and payable immediately. Certain events of bankruptcy or
insolvency are Events of Default which will result in the
Securities becoming due and payable immediately upon the
occurrence of such Events of Default.
A-6
<PAGE>
Securityholders may not enforce the Indenture or the
Securities except as provided in the Indenture. The Trustee
may refuse to enforce the Indenture or the Securities unless it
receives reasonable indemnity or security. Subject to certain
limitations, Holders of a majority in aggregate principal
amount of the Securities at the time outstanding may direct the
Trustee in its exercise of any trust or power. The Trustee may
withhold from Securityholders notice of any continuing Default
(except a Default in payment of amounts specified in clause (i)
above) if it determines that withholding notice is in their
interests.
13. Trustee Dealings with the Company
Subject to certain limitations imposed by the TIA,
the Trustee under the Indenture, in its individual or any other
capacity, may become the owner or pledgee of Securities and may
otherwise deal with and collect obligations owed to it by the
Company or its Affiliates and may otherwise deal with the
Company or its Affiliates with the same rights it would have if
it were not Trustee.
14. No Recourse Against Others
A director, officer, employee or stockholder, as
such, of the Company shall not have any liability for any
obligations of the Company under the Securities or the
Indenture or for any claim based on, in respect of or by reason
of such obligations or their creation. By accepting a
Security, each Securityholder waives and releases all such
liability. The waiver and release are part of the
consideration for the issue of the Securities.
15. Authentication
This Security shall not be valid until an authorized
Officer of the Trustee manually signs the Trustee's Certificate
of Authentication on the other side of this Security.
16. Abbreviations
Customary abbreviations may be used in the name of a
Securityholder or an assignee, such as TEN COM (=tenants in
common), TEN ENT (=tenants by the entirety), JT TEN (=joint
tenants with right of survivorship and not as tenants in
common), CUST (=custodian), and U/G/M/A (=Uniform Gift to
Minors Act).
17. Unclaimed Money
If money for the payment of principal or interest
remains unclaimed for two years, the Trustee or Paying Agent
A-7
<PAGE>
will pay the money back to the Company at its written request.
After that, Holders entitled to money must look to the Company
for payment.
18. Discharge Prior to Maturity
If the Company deposits with the Trustee or Paying
Agent money or U.S. Government Obligations sufficient to pay
the principal of and interest on the Securities to maturity or
redemption, as the case may be, the Company will be discharged
from the Indenture except for certain Sections thereof.
19. Successor
When a successor Person to the Company assumes all
the obligations of its predecessor under the Securities and the
Indenture, such predecessor shall be released from those
obligations.
20. Governing Law
THE INDENTURE AND THIS SECURITY SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW
YORK, AS APPLIED TO CONTRACTS MADE AND PERFORMED WITHIN THE
STATE OF NEW YORK WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF
LAWS. IF ANY ACTION OR PROCEEDING SHALL BE BROUGHT BY THE
TRUSTEE OR BY A HOLDER OF ANY OF THE SECURITIES IN ORDER TO
ENFORCE ANY RIGHT OR REMEDY UNDER THE INDENTURE OR UNDER THE
SECURITIES, THE COMPANY HEREBY CONSENTS AND SUBMITS TO THE
JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK AND OF ANY
FEDERAL COURT SITTING IN THE CITY OF NEW YORK, STATE OF NEW
YORK. ANY ACTION OR PROCEEDING BROUGHT BY THE COMPANY TO
ENFORCE ANY RIGHT, ASSERT ANY CLAIM OR OBTAIN ANY RELIEF
WHATSOEVER IN CONNECTION WITH THE INDENTURE OR THE SECURITIES
SHALL BE BROUGHT BY THE COMPANY EXCLUSIVELY IN THE COURTS OF
THE STATE OF NEW YORK OR IN ANY FEDERAL COURT SITTING IN THE
CITY OF NEW YORK, STATE OF NEW YORK.
A-8
<PAGE>
ASSIGNMENT FORM
To assign this Security, fill in the form below: (I)
or (we) assign and transfer this Security to:
_______________________________________________________________
(insert assignee's social security or tax I.D. number)
_______________________________________________________________
_______________________________________________________________
_______________________________________________________________
_______________________________________________________________
(print or type assignee's name, address and zip code)
and irrevocably appoint ______________________________ agent to
transfer this Security on the books of the Company. The agent
may substitute another to act for him.
Dated:______________ Signature:_______________________
(Sign exactly as your
name appears on the
face of this Security)
Signature
Guarantee:_____________________________________________________
OPTION OF HOLDER TO ELECT PURCHASE
If you wish to elect to have all or any portion of
this Security purchased by the Company pursuant to an "Offer"
in accordance with the provisions of Section 3.03 which are
required by Section 4.15 ("Repurchase Upon Change in Control")
or Section 4.16 ("Limitation on Asset Sales") check the
applicable boxes:
A-9
<PAGE>
___ ___
/__/ Section 4.15: /__/ Section 4.16:
___ ___
in whole /__/ in whole /__/
___ ___
in part /__/ (unpurchased in part /__/ (unpurchased
portion must be equal to portion must be equal to
$1,000 in principal amount $1,000 in principal amount
or an integral multiple or an integral multiple
thereof) thereof)
amount to be amount to be
purchased: $ ________ purchased: $ __________
Dated:_____________________ Signature:____________________
(Sign exactly as your
name appears on the face
of this Security)
Signature
Guarantee:_____________________________________________________
Social Security Number or
Taxpayer Identification Number:________________________________
A-10
Exhibit 4.5
[CONFORMED COPY]
SEQUA CORPORATION
and
THE FIRST NATIONAL BANK OF CHICAGO,
Trustee
_______________
FIRST SUPPLEMENTAL INDENTURE
Dated as of October 15, 1989
_______________
(Supplemental to Indenture Dated as of September 1, 1989)
9-5/8% Notes due October 15, 1999
<PAGE>
FIRST SUPPLEMENTAL INDENTURE, dated as of the 15th
day of October, 1989, to the Indenture dated as of September 1,
1989, between SEQUA CORPORATION, a corporation duly organized
under the laws of the State of Delaware (hereinafter sometimes
called the "Company"), party of the first part, and The First
National Bank of Chicago, a national banking association orga-
nized and existing under the laws of the United States of Amer-
ica (hereinafter sometimes called the "Trustee"), party of the
second part.
WHEREAS, for its lawful corporate purposes, the Com-
pany deems it necessary to create and issue a series of Securi-
ties known as its 9-5/8% Notes due October 15, 1999 (the
"Notes");
WHEREAS, Section 3.01 of the Indenture provides that
the Securities may be issued in one or more series and that the
particular terms of any such series may be set forth in an
indenture supplemental to the Indenture;
WHEREAS, Section 2.01 of the Indenture provides that
the forms of the Securities may be set forth in an indenture
supplemental to the Indenture;
WHEREAS, all things necessary to constitute these
presents a valid supplemental indenture and agreement according
to its terms have been done and performed by the Company, and
the execution of this First Supplemental Indenture has in all
respects been duly authorized by the Company, and the Company,
in the exercise of legal right and power in it vested, executes
this Indenture.
NOW, THEREFORE, THIS SUPPLEMENTAL INDENTURE
WITNESSETH:
That in order to declare the particular terms of the
Notes in accordance with Section 3.01 of the Indenture and to
set forth the form of the Notes in accordance with Section 2.01
of the Indenture, the Company and the Trustee covenant and
agree with each other, for the equal and proportionate benefit
of the respective Holders from time to time of Notes, as
follows:
SECTION 1. APPLICABILITY.
The terms of this First Supplemental Indenture shall
be applicable only to the Notes, and not to any other series of
securities issued under the Indenture, whether heretofor or
hereafter.
<PAGE>
-2-
SECTION 2. DEFINED TERMS.
All capitalized terms used in this First Supplemental
Indenture have the meanings assigned to them in the Indenture,
except to the extent that such terms are otherwise defined
herein.
SECTION 3. CERTAIN DEFINITIONS.
Board of Directors:
The term "Board of Directors", for the purpose of
this First Supplemental Indenture, shall mean the Board of
Directors of the Company.
Designated Event:
A "Designated Event" shall be deemed to have occurred
at such time as (i) a "person" or "group" (within the meaning
of Sections 13(d) and 14(d)(2) of the Securities Exchange Act
of 1934, as amended (the "1934 Act")), including any person or
group consisting of one or more employee benefit plans (as
defined in Section 3(3) of the Employee Retirement Income Secu-
rity Act of 1974, as amended) maintained by the Company or its
Subsidiaries, but not including any person or group consisting
solely of Norman E. Alexander and/or any Permitted Transferee,
becomes the "beneficial owner" (as defined in Rule 13d-3 under
the 1934 Act), directly or indirectly, of shares representing
more than 25% of the total voting power of the Voting Stock;
(ii) during any period of two consecutive years, individuals
who at the beginning of such period constitute the Company's
Board of Directors (together with any new director whose elec-
tion by the Company's Board of Directors or whose nomination
for election by the Company's shareholders was approved by a
vote of at least two-thirds of the directors then still in
office who either were directors at the beginning of such
period or whose election or nomination for election was previ-
ously so approved) cease for any reason to constitute a major-
ity of the directors then in office; (iii) the Company consoli-
dates with or merges into another corporation or conveys,
transfers or leases all or substantially all of its assets to
any person, or any corporation consolidates with or merges into
the Company, in any such event pursuant to a transaction in
which shares of Voting Stock of the Company are changed into or
exchanged for cash, securities or other property, provided that
such transactions (a) between the Company and its Subsidiaries
or between Subsidiaries, or (b) involving the exchange of
shares of Voting Stock as consideration in the acquisition of
<PAGE>
-3-
another business or businesses (without change or exchange of
the Company's outstanding Voting Stock) shall be excluded from
the operation of this clause (iii); (iv) the Company or any
Subsidiary of the Company purchases or otherwise acquires,
directly or indirectly, beneficial ownership of any shares of
Voting Stock of the Company if, after giving effect to such
purchase or acquisition, the Company (together with its Subsid-
iaries) shall have acquired, within any 12-month period, a num-
ber of shares of Voting Stock representing 20% or more of the
total voting power of the Voting Stock on the date immediately
prior to the first such purchase or acquisition during such
12-month period; or (v) the Company makes any distribution of
cash, property or securities (other than regular dividends and
distributions of capital stock of the Company) to holders of
shares of Voting Stock, or the Company or any Subsidiary pur-
chases or otherwise acquires, directly or indirectly, benefi-
cial ownership of shares of Voting Stock, and the sum of the
fair market value of such distribution or purchase, plus the
fair market value of all such distributions and purchases which
have occurred during the preceding 12 months, is at least 20%
of the fair market value of the outstanding Voting Stock. This
percentage shall be calculated by determining the percentage of
the fair market value of the Company's outstanding Voting Stock
as of the date of any such distribution or purchase which is
represented by the fair market value of the distributions or
purchases which have occurred on such date, and adding to that
percentage all of the percentages which have been similarly
calculated on the respective dates of all such distributions
and purchases during the preceding 12 months.
Full Rating Category:
The term "Full Rating Category" shall mean (i) with
respect to S&P, any of the following categories: BB, B, CCC,
CC and C, (ii) with respect to Moody's, any of the following
categories: Ba, B, Caa, Ca and C, and (iii) with respect to
any other Rating Agency, the equivalent of any such category of
S&P or Moody's used by such other Rating Agency. In determin-
ing whether the rating of the Notes has decreased by the
equivalent of one Full Rating Category, gradation within Full
Rating Categories (+ and - for S&P; 1, 2 and 3 for Moody's; or
the equivalent gradation for another Rating Agency) shall be
taken into account (e.g., with respect to S&P, a decline in a
rating from BB+ to B+ will constitute a decrease of one Full
Rating Category, and a decline in a rating from BB+ to BB-, or
from BB to B+, will constitute a decrease of less than one Full
Rating Category).
<PAGE>
-4-
Investment Grade:
The term "Investment Grade" shall mean BBB- or higher
by S&P or Baa3 or higher by Moody's or the equivalent of such
ratings by S&P or Moody's or by any other Rating Agency
selected by the Company.
Moody's:
The term "Moody's" shall mean Moody's Investors Ser-
vice Inc. and its successors.
Permitted Transferee:
The term "Permitted Transferee" shall mean (i) any
heir, executor, administrator, testamentary, trustee, legatee,
beneficiary or distributee of Norman E. Alexander and (ii) any
trust, the beneficiaries of which include only Norman E.
Alexander and any person described in clause (i) hereof.
Rating Agency:
The term "Rating Agency" shall mean S&P and Moody's,
or, if S&P or Moody's or both shall not make a rating of the
Notes publicly available, a nationally recognized securities
rating agency or agencies, as the case may be, selected by the
Company which shall be substituted for S&P or Moody's or both,
as the case may be;
Rating Date:
The term "Rating Date" shall mean the date which is
121 days prior to public notice of the occurrence of a Desig-
nated Event.
Rating Decline:
The term "Rating Decline" shall mean the occurrence
on any date within the period beginning on the date of any Des-
ignated Event and ending on the 90th day following public
notice of the occurrence of such Designated Event (which period
shall be extended so long as the rating of the Notes is under
publicly announced consideration for possible downgrade by a
Rating Agency) of any of the following events: (i) in the
event the Notes are rated Investment Grade by any Rating Agency
on the Rating Date, the rating of the Notes by one such rating
Agency shall be below Investment Grade, (ii) in the event the
Notes are rated below Investment Grade by any Rating Agency on
<PAGE>
-5-
the Rating Date, the rating of the Notes by one such Rating
Agency shall be at least one Full Rating Category below the
rating of the Notes by such Rating Agency on the Rating Date,
or (iii) any Rating Agency withdraws its rating of the Notes.
Reset Advisor:
The term "Reset Advisor" shall mean a nationally rec-
ognized banking firm that (i) does not have a direct or indi-
rect material financial interest in the Company and (ii) is, in
the reasonable judgment of the Board of Directors of the Com-
pany, otherwise independent and qualified to perform the tasks
for which it is being engaged.
S&P:
The term "S&P" shall mean Standard & Poor's Corpora-
tion and its successors.
Voting Stock:
The term "Voting Stock" shall mean all classes of
stock of the Company ordinarily entitled to vote in elections
of directors.
SECTION 4. DESIGNATION.
The Notes are hereby created and shall be issuable in
a single series to be designated "9-5/8% Notes due October 15,
1999".
SECTION 5. LIMITATION OF AMOUNT.
The maximum aggregate principal amount of Notes that
may be authenticated and delivered under this First Supplemen-
tal Indenture is limited to $150,000,000, except for Notes
authenticated and delivered upon registration of transfer of,
or in exchange for, or in lieu of, other Notes pursuant to
Sections 2.05, 3.04, 3.05, 3.06, or 9.05 of the Indenture.
SECTION 6. STATED MATURITY.
The principal amount of the Notes shall be due and
payable on October 15, 1999.
<PAGE>
-6-
SECTION 7. PAYMENTS OF PRINCIPAL AND INTEREST.
Subject to the provisions of Section 11 of this First
Supplemental Indenture, the Notes shall bear interest from
October 15, 1989, or from the most recent Interest Payment Date
to which interest has been paid or duly provided for, at the
rate of 9-5/8% per annum, payable semi-annually on April 15 and
October 15 in each year, commencing April 15, 1990, until the
principal thereof has been paid or duly provided for. Interest
on the Notes shall be computed on the basis of a 360-day year
of twelve 30-day months.
SECTION 8. NO REDEMPTION OR SINKING FUND.
The Notes will not be subject to redemption at the
option of the Company or repayment at the option of the Holders
prior to maturity. The Notes will not be subject to the opera-
tion of any sinking fund.
SECTION 9. FORM OF NOTES.
The Notes shall be substantially in the form of
Exhibit A attached to this First Supplemental Indenture.
SECTION 10. DEFEASANCE.
The Notes shall be subject to defeasance and covenant
defeasance as provided in Article Fourteen of the Indenture.
Upon any defeasance or covenant defeasance of the Notes, the
Company shall cease to be under any obligation to comply with
any term, provision or condition of Sections 11 and 12 of this
First Supplemental Indenture.
SECTION 11. PUT RIGHT OF HOLDERS OR INTEREST RATE
RESET.
(a) Upon the occurrence of both a Designated Event
and a Rating Decline at any time prior to October 15, 1999,
each Holder of the Notes shall have the right, at such Holder's
option, to tender to the Company all or part of the Notes held
by it (each Holder who tenders referred to herein as a "Tender-
ing Holder"), and upon exercise of such right, the Company
shall either (i) elect to repurchase the Notes tendered by each
Tendering Holder on the date (the "Repurchase Date") that is
seventy-five days after the last to occur of (A) public notice
of such Designated Event or (B) the Rating Decline (the later
of (A) or (B), the "Announcement Date"), at 100% of the princi-
pal amount thereof, plus any accrued interest to the Repurchase
<PAGE>
-7-
Date or (ii) elect not to repurchase such Notes, in which case,
on and after the date of such rating Decline, all of the Notes
(whether or not tendered) will bear interest at an interest
rate per annum equal to the greater of (A) the interest rate
per annum in effect immediately prior to such Rating Decline
and (B) the interest rate per annum, as determined by the Reset
Advisor selected by the Company as provided below, which, in
the Reset Advisor's opinion, would (in the absence of this
Section 11) have resulted in the market value of the Notes, as
of the close of business on the date that is fifty-five days
after the Announcement Date (the "Reset Date"), being 100% of
their principal amount.
(b) On or before the fifteenth day following the
Announcement Date, the Company shall give notice of the Desig-
nated Event and Rating Decline and of the tender right set
forth herein arising as a result thereof to the Trustee,
promptly following which the Company (or, at the request of the
Company, the Trustee) shall give notice regarding such Desig-
nated Event, such Rating Decline and such tender right by reg-
istered or certified mail, to each Holder of Notes at such
Holder's address appearing in the Securities Register. The
Company shall also cause a copy of such notice to be published
in an Authorized Newspaper.
Each notice of a tender right shall state:
(1) the Repurchase Date;
(2) the date by which the tender right must be
exercised;
(3) the price at which the repurchase is to be made,
if the Company elects to repurchase the tendered Notes;
(4) that the Company may elect to cause the interest
rate on the Notes to be reset instead of repurchasing the
Notes;
(5) the Reset Date;
(6) that by failing to tender, a Holder will be
deemed to have indicated a desire to hold the Notes at the
rate of interest in effect prior to the Rating Decline;
and
(7) a description of the procedure which a Holder of
Notes must follow to exercise a repurchase right.
<PAGE>
-8-
No failure of the Company to give the foregoing notice shall
limit any Holder's right to exercise a tender right.
(c) If the Company elects to reset the interest rate
on the Notes, the Company shall select the Reset Advisor not
later than five days prior to the Reset Date and shall make
available to the Reset Advisor such financial and other infor-
mation as it may reasonably request in order to enable it to
make the determination of interest rate referred to in clause
(ii)(B) of subsection (a) hereof on the Reset Date; provided,
however, that if the interest rate determined by the Reset
Advisor pursuant to clause (ii)(B) of subsection (a) hereof
shall exceed the maximum rate permitted under applicable law,
then the Company shall be deemed to have elected to repurchase
the tendered Notes pursuant to clause (i) of subsection (a)
hereof on the Repurchase Date.
(d) If the Company has elected not to repurchase the
tendered Notes, the Company shall give notice in writing to the
Trustee and any Paying Agent of such fact and of the interest
rate determined pursuant to subsection (c) hereof no later than
five days after the Reset Date, and within ten days after
receipt of such advice the Trustee shall give notice of the
interest rate so determined to all Holders of Notes in the man-
ner provided in Section 16.03 of the Indenture. The form of
Note attached hereto as Exhibit A shall be amended in such man-
ner as the Trustee and the Company may agree to reflect any
such determination of an increased interest rate and each Ten-
dering Holder will receive a new Note in like principal amount
reflecting such increased interest rate from the date of a Rat-
ing Decline. In addition, any Holder who did not exercise its
tender right may require its Note to be exchanged in accordance
with the provisions of the Indenture for a Note of like princi-
pal amount reflecting such increased interest rate from the
date of a Rating Decline.
(e) If a Rating Decline occurs prior to any Interest
Payment Date but a determination of an increased interest rate
pursuant to subsection (c) hereof is made only after such
Interest Payment Date, the Company shall (i) pay interest on
such Interest Payment Date at the interest rate per annum in
effect immediately prior to such Rating Decline and (ii) no
later than ten Business Days after such determination is made,
pay to Holders of record of the Notes on the Regular Record
Date with respect to such Interest Payment Date the additional
interest for the period from and including the date of such
Rating Decline to but excluding such Interest Payment Date.
<PAGE>
-9-
(f) To exercise a tender right, a Holder of Notes
shall deliver to the Company (or an agent designated by the
Company for such purpose in the notice referred to in subsec-
tion (b) hereof) not later than the forty-fifth day following
the Announcement Date, (i) written notice of the Holder's exer-
cise of such right, which notice shall set forth the name of
the Holder, the principal amount of the Note or Notes (or por-
tion of a Note) to be tendered, and a statement that the option
to exercise the tender right is being made thereby and (ii) the
Note with respect to which the tender right is being exercised,
duly endorsed for transfer to the Company. Such written notice
shall be irrevocable.
(g) In the event a tender right shall be exercised
and the Company elects (or is deemed to have elected) to repur-
chase the tendered Notes in accordance with the terms hereof,
the Company shall notify the Trustee of such election no later
than five days after the Reset Date, and within ten days after
receipt of such advice the Trustee shall give notice of such
election to all Tendering Holders in the manner provided in
Section 16.03 of the Indenture. The Company shall pay or cause
to be paid the price payable with respect to the Note or Notes
(or portion thereof) as to which the tender right has been
exercised in cash, in the manner provided in Section 10.01 of
the Indenture, to the Holder of such Note or Notes, on the
Repurchase Date. In the event that a tender right is exercised
with respect to less than the entire principal amount of a sur-
rendered Note, the Company shall execute and deliver to the
Trustee, and the Trustee shall authenticate for issuance in the
name of the Holder thereof, a new Note or Notes in the aggre-
gate principal amount of that portion of such surrendered Note
not repurchased.
(h) In the event the Company elects (or is deemed to
have elected) to repurchase the Notes tendered by the Tendering
Holders, the Company shall be under no obligation to reset the
interest rate with respect to Notes held by Holders who did not
exercise their tender right.
SECTION 12. EVENTS OF DEFAULT.
In addition to the Events of Default specified in
Section 5.01 of the Indenture, Events of Default with respect
to t he Notes shall include default in the performance, or
breach, of any covenant or warranty under Section 11 hereof
(whatever the reason for such default and whether it shall be
voluntary or involuntary or be effected by operation of law or
pursuant to any judgment, decree or order of any court or any
<PAGE>
-10-
order, rule or regulation of any administrative or governmental
body) and continuance of such default or breach for a period of
45 days after there has been given, by registered or certified
mail, to the Company by the Trustee or to the Company and the
Trustee by the Holders of at least 25% in principal amount of
the notes a written notice specifying such default or breach
and requiring it to be remedied and stating that such notice is
a "Notice of Default" hereunder.
SECTION 13. COUNTERPARTS.
This First Supplemental Indenture may be executed in
any number of counterparts, each of which shall be an original,
but all of which shall together constitute one and the same
instrument.
SECTION 14. MISCELLANEOUS.
(a) Except as expressly supplemented by this First
Supplemental Indenture, the terms of the Indenture remain in
full force and effect with respect to the Notes.
(b) This First Supplemental Indenture shall be con-
strued as supplemental to the Indenture and shall form a part
thereof.
IN WITNESS WHEREOF, the Company and the Trustee have
caused this First Supplemental Indenture to be duly executed by
their respective officers thereunto duly authorized as of the
day and year first above written.
SEQUA CORPORATION
By s/ KENNETH A. DRUCKER
[CORPORATE SEAL]
Attest: s/ IRA A. SCHREGER
<PAGE>
-11-
THE FIRST NATIONAL BANK OF CHICAGO,
As Trustee
By s/ MAUREEN BOLTON
[CORPORATE SEAL]
Attest: s/ ROBERT J. CHAPMAN
Exhibit 4.6
SEQUA CORPORATION
$125,000,000
8-3/4% Senior Notes due December 15, 2001
____________________
INDENTURE
Dated as of December 15, 1993
____________________
IBJ SCHRODER BANK & TRUST COMPANY, Trustee
<PAGE>
CROSS REFERENCE TABLE
TIA Indenture
Section Section
310(a)(1).............................................. 7.10
(a)(2).............................................. 7.10
(a)(3).............................................. N.A.*
(a)(4).............................................. N.A.
(b)................................................. 7.08; 7.10
(c)................................................. N.A.
311(a)................................................. 7.11
(b)................................................. 7.11
(c)................................................. N.A.
312(a)................................................. 2.05
(b)................................................. 10.03
(c)................................................. 10.03
313(a)................................................. 7.06
(b)(1).............................................. N.A.
(b)(2).............................................. 7.06
(c)................................................. 7.06
(d)................................................. 7.06
314(a)................................................. 4.02; 4.03;
4.04
(b)................................................. N.A.
(c)(1).............................................. 10.04
(c)(2).............................................. 10.04
(c)(3).............................................. N.A.
(d)................................................. N.A.
(e)................................................. 10.04; 10.05
(f)................................................. N.A.
315(a)................................................. 7.01
(b)................................................. 7.05
(c)................................................. 7.01
(d)................................................. 7.01
(e)................................................. 6.11
316(a)(last sentence)................................. 2.08
(a)(1)(A)........................................... 6.05
(a)(1)(B)........................................... 6.04
(a)(2).............................................. N.A.
(b)................................................. 6.07
(c)................................................. 9.04
317(a)(1).............................................. 6.08
(a)(2).............................................. 6.09
(b)................................................. 2.04
318(a)................................................. 10.01
___________________
* N.A. means Not Applicable.
-i-
<PAGE>
TABLE OF CONTENTS
Page
ARTICLE 1 DEFINITIONS AND INCORPORATION BY REFERENCE . . . . . 1
SECTION 1.01. Definitions . . . . . . . . . . . . . . 1
SECTION 1.02. Other Definitions . . . . . . . . . . . 20
SECTION 1.03. Incorporation by Reference of
Trust Indenture Act . . . . . . . . . 21
SECTION 1.04. Rules of Construction . . . . . . . . . 21
SECTION 1.05. Acts of Holders . . . . . . . . . . . . 22
ARTICLE 2 THE SECURITIES . . . . . . . . . . . . . . . . . . . 23
SECTION 2.01. Form and Dating . . . . . . . . . . . . 23
SECTION 2.02. Execution and Authentication. . . . . . 23
SECTION 2.03. Registrar and Paying Agent. . . . . . . 24
SECTION 2.04. Paying Agent to Hold Money in
Trust . . . . . . . . . . . . . . . . 25
SECTION 2.05. Securityholder Lists. . . . . . . . . . 26
SECTION 2.06. Transfer and Exchange . . . . . . . . . 26
SECTION 2.07. Replacement Securities . . . . . . . . 27
SECTION 2.08. Outstanding Securities;
Determination of Holders' Action. . . 28
SECTION 2.09. Temporary Securities . . . . . . . . .
SECTION 2.10. Cancellation. . . . . . . . . . . . . . 29
SECTION 2.11. CUSIP Numbers . . . . . . . . . . . . . 29
SECTION 2.12. Defaulted Interest. . . . . . . . . . . 30
ARTICLE 3 REDEMPTION . . . . . . . . . . . . . . . . . . . . . 30
SECTION 3.01. Right to Redeem; Notices to
Trustee . . . . . . . . . . . . . . . 30
SECTION 3.02. Public Equity Offering
Redemption. . . . . . . . . . . . . . 30
SECTION 3.03. Mandatory Redemption. . . . . . . . . . 31
SECTION 3.04. Selection of Securities to Be
Redeemed. . . . . . . . . . . . . . . 31
SECTION 3.05. Notice of Redemption. . . . . . . . . . 31
SECTION 3.06. Effect of Notice of Redemption. . . . . 32
SECTION 3.06 Deposit of Redemption Price . . . . . . 33
SECTION 3.07 Securities Redeemed in Part . . . . . . 33
ARTICLE 4 COVENANTS. . . . . . . . . . . . . . . . . . . . . . 33
SECTION 4.01. Payment of Securities . . . . . . . . . 33
SECTION 4.02. [Intentionally Omitted] . . . . . . . . 34
SECTION 4.03. SEC Reports . . . . . . . . . . . . . . 34
SECTION 4.04. Compliance Certificates . . . . . . . . 34
-ii-
<PAGE>
Page
SECTION 4.05. Payment of Taxes and Other
Claims. . . . . . . . . . . . . . . . 35
SECTION 4.06. Waiver of Stay, Extension, or
Usury Laws. . . . . . . . . . . . . . 36
SECTION 4.07. Corporate Existence . . . . . . . . . . 36
SECTION 4.08. Limitation on Restricted
Payments. . . . . . . . . . . . . . . 36
SECTION 4.09. Limitation on Additional
Indebtedness. . . . . . . . . . . . . 38
SECTION 4.10. Limitation on Indebtedness and
Disqualified Stock of Restricted
Subsidiaries. . . . . . . . . . . . . 38
SECTION 4.11. Limitation on Liens . . . . . . . . . . 39
SECTION 4.12. Limitation on Dividend and Other
Payment Restrictions Affecting
Restricted Subsidiaries.. . . . . . . . 40
SECTION 4.13. Limitation on Sale and Leaseback
Transactions. . . . . . . . . . . . . 41
SECTION 4.14. Limitation on Transactions with
Affiliates. . . . . . . . . . . . . . 41
SECTION 4.15. Repurchase Upon Change of
Control . . . . . . . . . . . . . . . 42
SECTION 4.16. Limitation on Asset Sales . . . . . . . 45
SECTION 4.17. Maintenance of Properties and
Insurance . . . . . . . . . . . . . . 49
SECTION 4.18. Payments for Consents . . . . . . . . . 50
SECTION 4.19. Limitation on Applicability of
Certain Covenants . . . . . . . . . . 50
SECTION 4.20. Further Assurances. . . . . . . . . . . 50
ARTICLE 5 SUCCESSOR CORPORATION. . . . . . . . . . . . . . . . 51
SECTION 5.01. Limitation on Merger,
Consolidation and Sale of
Substantially All Assets. . . . . . . 51
SECTION 5.02. Successor Corporation
Substituted . . . . . . . . . . . . . 52
ARTICLE 6 DEFAULTS AND REMEDIES . . . . . . . . . . . . . . . . 53
SECTION 6.01. Events of Default . . . . . . . . . . . 53
SECTION 6.02. Acceleration. . . . . . . . . . . . . . 54
SECTION 6.03. Other Remedies. . . . . . . . . . . . . 55
SECTION 6.04. Waiver of Past Defaults . . . . . . . . 55
SECTION 6.05. Control by Majority . . . . . . . . . . 56
SECTION 6.06. Limitation on Suits . . . . . . . . . . 56
SECTION 6.07. Rights of Holders to Receive
Payment . . . . . . . . . . . . . . . 57
-iii-
<PAGE>
Page
SECTION 6.08. Collection Suit by Trustee. . . . . . . 57
SECTION 6.09. Trustee May File Proofs of Claim. . . . 57
SECTION 6.10. Priorities. . . . . . . . . . . . . . . 58
SECTION 6.11. Undertaking for Costs . . . . . . . . . 58
ARTICLE 7 TRUSTEE. . . . . . . . . . . . . . . . . . . . . . . 59
SECTION 7.01. Duties of Trustee . . . . . . . . . . . 59
SECTION 7.02. Rights of Trustee . . . . . . . . . . . 60
SECTION 7.03. Individual Rights of Trustee. . . . . . 61
SECTION 7.04. Trustee's Disclaimer. . . . . . . . . . 62
SECTION 7.05. Notice of Defaults. . . . . . . . . . . 62
SECTION 7.06. Reports by Trustee to Holders . . . . . 62
SECTION 7.07. Compensation and Indemnity. . . . . . . 62
SECTION 7.08. Replacement of Trustee. . . . . . . . . 63
SECTION 7.09. Successor Trustee by Merger . . . . . . 64
SECTION 7.10. Eligibility; Disqualification . . . . . 65
SECTION 7.11. Preferential Collection of Claims
Against Company . . . . . . . . . . . 65
ARTICLE 8 DISCHARGE OF INDENTURE . . . . . . . . . . . . . . . 65
SECTION 8.01. Discharge of Liability on
Securities; Defeasance. . . . . . . . 65
SECTION 8.02. Conditions to Defeasance. . . . . . . . 66
SECTION 8.03. Application of Trust Money. . . . . . . 69
SECTION 8.04. Repayment to the Company. . . . . . . . 69
SECTION 8.05. Indemnity for Government
Obligations . . . . . . . . . . . . . 69
SECTION 8.06. Reinstatement . . . . . . . . . . . . . 69
ARTICLE 9 AMENDMENTS . . . . . . . . . . . . . . . . . . . . . 70
SECTION 9.01. Without Consent of Holders. . . . . . . 70
SECTION 9.02. With Consent of Holders . . . . . . . . 70
SECTION 9.03. Compliance with Trust Indenture
Act . . . . . . . . . . . . . . . . . 72
SECTION 9.04. Revocation and Effect of
Consents, Waivers and Actions . . . . 72
SECTION 9.05. Notation on or Exchange of
Securities. . . . . . . . . . . . . . 72
SECTION 9.06. Trustee to Sign Supplemental
Indentures. . . . . . . . . . . . . . 73
SECTION 9.07. Effect of Supplemental
Indentures. . . . . . . . . . . . . . 73
ARTICLE 10 MISCELLANEOUS. . . . . . . . . . . . . . . . . . . . 73
-iv-
<PAGE>
Page
SECTION 10.01. Trust Indenture Act Controls. . . . . . 73
SECTION 10.02. Notices . . . . . . . . . . . . . . . . 74
SECTION 10.03. Communication by Holders with
Other Holders . . . . . . . . . . . . 74
SECTION 10.04. Certificate and Opinion as to
Conditions Precedent. . . . . . . . . 75
SECTION 10.05. Statements Required in
Certificate or Opinion. . . . . . . . 75
SECTION 10.06. Separability Clause . . . . . . . . . . 75
SECTION 10.07. Rules by Trustee, Paying Agent
and Registrar . . . . . . . . . . . . 75
SECTION 10.08. Legal Holidays. . . . . . . . . . . . . 76
SECTION 10.09. GOVERNING LAW AND CHOICE OF
FORUM . . . . . . . . . . . . . . . . 76
SECTION 10.10. No Recourse Against Others. . . . . . . 76
SECTION 10.11. Successors. . . . . . . . . . . . . . . 76
SECTION 10.12. Multiple Originals. . . . . . . . . . . 76
SIGNATURES . . . . . . . . . . . . . . . . . . . . . . . . . . . 78
EXHIBIT A. . . . . . . . . . . . . . . . . . . . . . . . . . . A-1
-v-
<PAGE>
INDENTURE, dated as of December 15, 1993, between
Sequa Corporation, a Delaware corporation (the "Company"), and
IBJ Schroder Bank & Trust Company, as trustee (the "Trustee").
Each party agrees as follows for the benefit of the
other party and for the equal and ratable benefit of the hold-
ers of the Company's 8-3/4% Senior Notes due December 15, 2001:
ARTICLE 1
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01. Definitions.
"Acquired Debt" means, with respect to any specified
Person, (i) Indebtedness of any other Person or any of its Sub-
sidiaries existing at the time such other Person merged with or
into or became a Subsidiary of such specified Person, including
Indebtedness incurred in connection with, or in contemplation
of, such other Person merging with or into or becoming a Sub-
sidiary of such specified Person and (ii) Indebtedness encum-
bering any asset acquired by such specified Person or assumed
by such specified Person in connection with the acquisition of
assets.
"Affiliate" of any specified Person means any other
Person who directly or indirectly through one or more interme-
diaries controls or is controlled by, or is under common con-
trol with such specified Person. For purposes of this defini-
tion, "control" (including, with correlative meanings, the
terms "controlling," "controlled by" and "under common control
with"), as used with respect to any Person, shall mean the
possession, directly or indirectly, of the power to direct or
cause the direction of the management or policies of such Per-
son, whether through the ownership of voting securities, by
agreement or otherwise.
"ARC" means Atlantic Research Corporation, a Delaware
corporation.
"ARC Minority Interest" means the Equity Interests of
ARC held by Bankers Trust New York Corporation as of the date
of this Indenture.
<PAGE>
-2-
"ARC Stock Purchase and Restriction Agreement" means
the Stock Purchase and Restriction Agreement, dated
December 19, 1989, among the Company, ARC, Chromalloy Gas Tur-
bine Corporation and Bankers Trust New York Corporation.
"Asset Sale" means any direct or indirect sale, issu-
ance, conveyance, transfer, capital lease, assignment or other
transfer for value (including any sale and leaseback transac-
tion) by the Company or any of its Restricted Subsidiaries to
any Person other than the Company or a Restricted Subsidiary of
the Company of (i) any Equity Interests of any Subsidiary of
the Company or (ii) any other property or assets of the Company
or any Restricted Subsidiary of the Company (including a con-
solidation or merger or other sale of any Restricted Subsidiary
with, into or to another Person in a transaction in which such
Restricted Subsidiary ceases to be a Restricted Subsidiary),
other than (x) the sale of inventory or obsolete equipment in
the ordinary course of business consistent with past practice
or (y) any transaction or series of related transactions for
which the Company or its Restricted Subsidiaries receive aggre-
gate consideration of less than $2.5 million.
"Attributable Indebtedness" means, with respect to
any sale and leaseback transaction, as at the time of determi-
nation, the greater of (i) the Fair Market Value of the prop-
erty subject to such arrangement and (ii) the present value
(discounted at a rate equivalent to the Company's then current
weighted average cost of funds for borrowed money, compounded
on a semi-annual basis) of the total obligations of the lease
for rental payments during the remaining term of the lease
included in such arrangement (including any period for which
such lease has been extended).
"Bankruptcy Law" means Title 11, United States Code,
or any similar Federal or state law for the relief of debtors.
"Board of Directors" of any corporation means the
Board of Directors of such corporation, or any duly authorized
committee of such Board of Directors.
"Business Day" means any day that is not a Saturday,
a Sunday or a day on which banking institutions are required to
close in New York, New York or in the city that the Trustee or
the Paying Agent is located.
"Capital Lease Obligation" means, as to any Person,
the Obligations of such Person in respect of a lease that would
<PAGE>
-3-
at such time be required to be classified and accounted for as
capitalized lease obligations under GAAP and the amount of such
obligations at any date shall be the capitalized amount of such
obligations at such date, determined in accordance with GAAP.
"Capital Stock" means (i) with respect to any Person
formed as a corporation, any and all shares, interests, partic-
ipations, rights or other equivalents (however designated) of
corporate stock, including, without limitation, common stock
and preferred stock of such Person and (ii) with respect to any
Person formed other than as a corporation, any and all partner-
ship or other equity interests of such other Person.
"Cash Equivalents" means: (i) United States dollars;
(ii) securities issued or directly and fully guaranteed or
insured by the United States government or any agency or
instrumentality thereof having maturities of not more than six
months from the date of acquisition; (iii) certificates of
deposit and eurodollar time deposits with maturities of six
months or less from the date of acquisition, bankers' acceptan-
ces with maturities not exceeding six months and overnight bank
deposits, in each case with any lender party to the New Credit
Facility or with any domestic commercial bank having capital
and surplus in excess of $500 million; (iv) repurchase obliga-
tions with a term of not more than seven days for underlying
securities of the types described in clauses (ii) and (iii)
entered into with any financial institution meeting the quali-
fications specified in clause (iii) above; (v) commercial paper
rated A-1 or the equivalent thereof by Moody's Investors Ser-
vice, Inc. or Standard & Poor's Ratings Group and in each case
maturing within six months after the date of acquisition; and
(vi) investments in money market funds which invest substan-
tially all their assets in securities of the types described in
clauses (i) through (v) above.
"Change of Control" means the occurrence of any of
the following: (i) the sale, lease, exchange or other trans-
fer, in one or a series of related transactions, of all or sub-
stantially all of the Company's assets to any Person or group
of related Persons (a "Group") (as such term is used in
Section 13(d) of the Exchange Act); (ii) the adoption of a plan
by the stockholders of the Company relating to the liquidation
or dissolution of the Company; (iii) except as provided below,
the acquisition of beneficial ownership by any Person or Group,
together with any Affiliates thereof (collectively, the "Inter-
ested Stockholders"), of a direct or indirect interest in more
than 35% of the voting power of the then outstanding Capital
<PAGE>
-4-
Stock of the Company entitled to vote generally in the election
of the Board of Directors of the Company; or (iv) during any
period of two consecutive years, individuals who at the begin-
ning of such period constituted the Company's Board of Direc-
tors (together with any new directors whose election or
appointment by such board or whose nomination for election or
appointment by the shareholders of the Company was approved by
a vote of a majority of the directors then still in office who
were either directors at the beginning of such period or whose
election or nomination for election was previously so approved)
cease for any reason to constitute a majority of the Company's
Board of Directors then in office; provided, however, that for
the purposes of the foregoing clauses (i) and (iii), the terms
"Person" or "Group" shall not be deemed to include
Mr. Alexander, his spouse, any descendant of Mr. Alexander or
the spouse of any such descendant, the estate of Mr. Alexander,
or any trust or other similar arrangement for the benefit of
Mr. Alexander or his spouse, any descendent of Mr. Alexander or
the spouse of any such descendant or the estate of
Mr. Alexander or any corporation or other Person controlled
solely by one or more of Mr. Alexander or his spouse, any
descendant of Mr. Alexander or the spouse of any such descen-
dant or the estate of Mr. Alexander through the ownership of a
majority of the outstanding voting Capital Stock of such corpo-
ration or other Person (collectively, the "Alexander Stockhold-
ers"); and provided, further, that there shall not be a "Change
of Control" pursuant to clause (iii) above so long as the
Alexander Stockholders beneficially own a greater percentage of
the voting power of the then outstanding Capital Stock of the
Company than the Interested Stockholders.
"Consolidated EBITDA" means, with respect to any Per-
son, for any period, the sum (without duplication) of
(i) Consolidated Net Income of such Person for such period and
(ii) to the extent Consolidated Net Income has been reduced
thereby, Consolidated Tax Expense, Consolidated Interest
Expense and Consolidated Non-Cash Charges of such Person for
such period and, with respect to the Company, extraordinary
losses resulting from the Company's redemption of its outstand-
ing 10>% Senior Subordinated Notes due 1998, less all non-cash
items to the extent Consolidated Net Income has been increased
thereby.
"Consolidated Fixed Charges" means, with respect to
any Person, the sum, without duplication, of (i) Consolidated
Interest Expense of such Person and (ii) the product of (x) the
amount of all cash and non-cash dividend payments on any series
<PAGE>
-5-
of preferred stock of such Person and its Restricted Subsidiar-
ies (except dividends for such period which are accrued but
unpaid) times (y) a fraction, the numerator of which is one and
the denominator of which is one minus the then current effec-
tive consolidated federal, state and local tax rate of such
Person, expressed as a decimal.
"Consolidated Interest Coverage Ratio" means with
respect to any Person, the ratio of (i) Consolidated EBITDA of
such Person during the Four Quarter Period next preceding the
date of the transaction or event giving rise to the need to
calculate the Consolidated Interest Coverage Ratio (the "Trans-
action Date") to (ii) Consolidated Fixed Charges for such Per-
son for such Four Quarter Period. For purposes of this defini-
tion, "Consolidated EBITDA" and "Consolidated Fixed Charges"
shall be calculated after giving effect on a pro forma basis
for the Four Quarter Period to (i) the incurrence or repayment
of any Indebtedness of such Person or any of its Restricted
Subsidiaries at any time on or subsequent to the last day of
the Four Quarter Period and on or prior to the Transaction
Date, as if such incurrence or repayment, as the case may be
(and the application of the proceeds thereof), occurred on the
first day of the Four Quarter Period and (ii) any Asset Sales
or other asset dispositions of such Person and its Restricted
Subsidiaries occurring at any time on or subsequent to the last
day of the Four Quarter Period and on or prior to the Transac-
tion Date, as if such Asset Sale or other asset disposition
occurred on the first day of the Four Quarter Period. If such
Person or any of its Restricted Subsidiaries directly or indi-
rectly guarantees Indebtedness of a third Person, the preceding
sentence shall give effect to the incurrence of such guaranteed
Indebtedness as if such Person or any Restricted Subsidiary of
such Person had directly incurred or otherwise assumed such
guaranteed Indebtedness. Furthermore, in calculating "Consoli-
dated Fixed Charges": (i) interest on Indebtedness determined
on a fluctuating basis as of the Transaction Date and which
will continue to be so determined thereafter shall be deemed to
have accrued at a fixed rate per annum equal to the rate of the
interest on such Indebtedness in effect on the Transaction
Date; (ii) interest on any Indebtedness under a revolving
credit facility computed on a pro forma basis shall be computed
based upon the average daily balance of such Indebtedness dur-
ing the Four Quarter Period; (iii) if interest on any Indebted-
ness actually incurred on the Transaction Date may optionally
be determined at an interest rate based upon a factor of a
prime or similar rate, a eurocurrency interbank offered rate,
or other rates, then the interest rate in effect on the
<PAGE>
-6-
Transaction Date will be deemed to have been in effect during
the Four Quarter Period; and (iv) notwithstanding clause (i)
above, interest on Indebtedness determined on a fluctuating
basis to the extent such interest is covered by Hedging Obliga-
tions, shall be deemed to accrue at the rate per annum result-
ing after giving effect to the operation of such Hedging
Obligations.
"Consolidated Interest Expense" means, with respect
to any Person, for any period, the aggregate amount of all cash
and non-cash interest expense of such Person and its Restricted
Subsidiaries for such period, on a consolidated basis deter-
mined in accordance with GAAP, including all cash and non-cash
interest expense in respect of guarantees of Indebtedness by
such Person and its Restricted Subsidiaries, excluding the
amortization or write-off of deferred financing costs and the
interest expense in respect of the Indebtedness of Sequa Capi-
tal referred to in clause (v) under Section 4.10 hereof
included in cash or non-cash interest expense.
"Consolidated Net Income" means, with respect to any
Person, for any period, the aggregate of the net income (or
loss) of such Person and its Subsidiaries (after minority
interests) for such period on a consolidated basis determined
in accordance with GAAP; provided, however, that there shall be
excluded therefrom: (i) net gains or losses from Asset Sales
or other dispositions of assets other than in the ordinary
course of business; (ii) any gains or losses from currency
exchange transactions not in the ordinary course of business
consistent with past practice; (iii) items classified as extra-
ordinary, non-recurring or unusual gains, and the related tax
effects, each as determined in accordance with GAAP; (iv) the
net income of any Person acquired by such Person or a
Restricted Subsidiary of such Person in a pooling of interests
transaction for any period prior to the date of the transac-
tion; (v) the net income of any Restricted Subsidiary of such
Person to the extent such Restricted Subsidiary has any
restrictions or encumbrances on making distributions to the
Company or another Restricted Subsidiary of the Company by con-
tract, operation of law or otherwise; and (vi) the net income
of any Person that is not a Restricted Subsidiary of such Per-
son except to the extent of the amount of dividends or other
distributions actually paid to such Person by such other Person
during such period.
"Consolidated Net Worth" means, with respect to any
Person, as of any date, the sum of (i) the consolidated equity
<PAGE>
-7-
of the common stockholders of such Person and its consolidated
Restricted Subsidiaries as of such date plus (ii) the respec-
tive amounts reported on such Person's balance sheet as of such
date with respect to any series of preferred stock (other than
Disqualified Stock) that by its terms is not entitled to the
payment of dividends unless such dividends may be declared and
paid only out of net earnings in respect of the year of such
declaration and payment, but only to the extent of any cash
received by such Person upon issuance of such preferred stock,
less (x) all write-ups (other than write-ups resulting from
foreign currency translations and write-ups of tangible assets
of a going concern business made within 12 months after the
acquisition of such business) subsequent to the date of this
Indenture in the book value of any asset owned by such Person
or a consolidated Restricted Subsidiary of such Person, (y) all
investments as of such date in unconsolidated Subsidiaries and
in Persons that are not Restricted Subsidiaries (except, in
each case, represented by Permitted Investments), and (z) all
unamortized debt discount and expense and unamortized deferred
charges as of such date, all of the foregoing as determined in
accordance with GAAP.
"Consolidated Non-Cash Charges" of any Person means,
for any period, the aggregate depreciation, amortization
(including write-off of deferred financing costs) and other
non-cash charges of such Person and its Restricted Subsidiaries
for such period, on a consolidated basis determined in accor-
dance with GAAP (excluding any such non-cash charge which
requires an accrual or reserve for cash charges for any future
period and excluding any such non-cash charge that is included
in Consolidated Interest Expense or Consolidated Tax Expense).
"Consolidated Tax Expense" means, with respect to any
Person, for any period, the aggregate expenses (or provisions)
of such Person and its Restricted Subsidiaries with respect to
all applicable taxes for such period, on a consolidated basis,
determined in accordance with GAAP.
"Custodian" means any receiver, trustee, assignee,
liquidator, sequestrator, custodian or similar official under
any Bankruptcy Law.
"Defaults" means any event or condition that is or
with the passage of time or the giving of notice or both would
be an Event of Default.
<PAGE>
-8-
"Disqualified Stock" means (i) any Capital Stock
which, by its terms (or by the terms of any security into which
it is convertible or for which it is exchangeable), or upon the
happening of any event, matures or is mandatorily redeemable,
pursuant to a sinking fund obligation or otherwise, or redeem-
able at the option of the holder thereof, in whole or in part,
on or prior to the final stated maturity of the Securities, or
(ii) any warrants, options or other rights to acquire any such
Capital Stock referred to in clause (i) above.
"Equity Interests" means Capital Stock and all war-
rants, options or other rights to acquire Capital Stock (but
excluding any debt security that is convertible into or
exchangeable for Capital Stock).
"Exchange Act" means the Securities Exchange Act of
1934, as amended.
"Existing Indebtedness" means Indebtedness of the
Company and its Restricted Subsidiaries (other than under the
New Credit Facility) in existence on the date of this Inden-
ture, until such amounts are repaid.
"Fair Market Value" means, with respect to any asset
or property, the sale value that would be obtained in an arm's
length transaction between an informed and willing seller under
no compulsion to sell and an informed and willing buyer under
no compulsion to buy. Unless otherwise provided, Fair Market
Value shall be determined by a majority of the disinterested
members of the Board of Directors and, if such Fair Market
Value is in excess of $1.0 million, then such Fair Market Value
shall be evidenced by a resolution of the Board of Directors
and set forth in an Officer's Certificate delivered to the
Trustee.
"Foreign Asset Sale" means any Asset Sale in respect
of the Capital Stock and/or property of any Foreign Restricted
Subsidiary to the extent that the proceeds of such Asset Sale
are received by a Person subject in respect of such proceeds to
the tax laws of a jurisdiction other than the United States of
America or any state thereof or the District of Columbia or to
currency exchange laws of a jurisdiction other than the United
States of America or any state thereof or the District of
Columbia, in either case that prohibit the repatriation of such
proceeds to the United States.
<PAGE>
-9-
"Foreign Restricted Subsidiary" means, for any Per-
son, any Restricted Subsidiary of such Person that conducts
substantially all of its operations outside of the United
States and is organized under the laws of any jurisdiction out-
side the United States.
"Four Quarter Period" means the most recent four fis-
cal quarters for which financial information is available.
"GAAP" means generally accepted accounting principles
set forth in the opinions and pronouncements of the Accounting
Principles Board of the American Institute of Certified Public
Accountants and statements and pronouncements of the Financial
Accounting Standards Board or in such other statements by such
other entity as approved by a significant segment of the
accounting profession, which are in effect as of the date of
this Indenture.
"Hedging Obligations" means, with respect to any Per-
son, the obligations of such Person determined in accordance
with GAAP under interest rate swap agreements, interest rate
cap agreements, currency swap agreements and other agreements
or arrangements designed to protect such Person against fluctu-
ations in interest rates or currency exchange rates.
"Holder" or "Securityholder" means a Person in whose
name a Security is registered on the Registrar's books.
"Indebtedness" means, with respect to any Person, any
indebtedness of such Person, contingent or otherwise, in
respect of borrowed money, including all principal, interest,
fees and expenses with respect thereto (whether or not the
recourse of the lender is to the whole of the assets of such
person or only to a portion thereof), or evidenced by bonds,
notes, debentures or similar instruments or letters of credit
or banker's acceptances (or reimbursement obligations with
respect thereto) or representing the balance deferred and
unpaid of the purchase price of any property (including pursu-
ant to financing leases), if and to the extent any of the fore-
going indebtedness would appear as a liability upon a balance
sheet of such Person prepared in accordance with GAAP (except
that any such balance that constitutes a trade payable and/or
accrued liability arising in the ordinary course of business
shall not be considered Indebtedness), and shall also include,
to the extent not otherwise included, interest accruing after
the commencement of any bankruptcy, insolvency, receivership or
similar proceeding and other interest that would have accrued
<PAGE>
-10-
but for the commencement of such proceeding, any Capital Lease
Obligations, the maximum fixed repurchase price of any Disqual-
ified Stock, indebtedness secured by a Lien to which the prop-
erty or assets owned or held by such Person is subject, whether
or not the obligations secured thereby shall have been assumed
by such Person, guarantees of items that would be included
within this definition to the extent of such guarantees (exclu-
sive of whether such items would appear upon such balance
sheet), and Hedging Obligations. For purposes of the preceding
sentence, the maximum fixed repurchase price of any Disquali-
fied Stock which does not have a fixed repurchase price shall
be calculated in accordance with the terms of such Disqualified
Stock as if such Disqualified Stock were repurchased on any
date on which Indebtedness shall be required to be determined
pursuant to this Indenture, provided that such Disqualified
Stock is not then permitted to be repurchased, the repurchase
price shall be the book value of such Disqualified Stock. The
amount of Indebtedness of any Person at any date shall be,
without duplication, (i) the outstanding balance at such date
of all unconditional obligations as described above and the
maximum liability of any such contingent obligations at such
date and (ii) in the case of Indebtedness of others secured by
a Lien to which the property or assets owned or held by such
Person is subject, the lesser of the Fair Market Value at such
date of any asset subject to a Lien securing the Indebtedness
of others and the amount of the Indebtedness secured.
"Indenture" means this Indenture, as amended or sup-
plemented from time to time in accordance with the terms
hereof, including the provisions of the TIA that are deemed to
be a part hereof.
"Investments" means, with respect to any Person, all
investments by such Person in other Persons (including Affili-
ates) in the forms of loans (including guarantees), advances or
capital contributions, by means of transfers of cash or other
property (excluding credit sales, commission, travel and simi-
lar advances to officers and employees made in the ordinary
course of business), purchases or other acquisitions for con-
sideration of Indebtedness, Equity Interests or other securi-
ties and all other items that are or would be classified as
investments on a balance sheet prepared in accordance with
GAAP.
"Lien" means, with respect to any asset, any mort-
gage, lien, pledge, charge, security interest or encumbrance of
any kind in respect of such asset, whether or not filed,
<PAGE>
-11-
recorded or otherwise perfected under applicable law (including
any conditional sale or other title retention agreement, any
lease in the nature thereof, any option or other agreement to
sell or give a security interest in and any filing of or agree-
ment to give any financing statement under the Uniform Commer-
cial Code (or equivalent statute) of any jurisdiction).
"Net Cash Proceeds" means the aggregate cash proceeds
or Cash Equivalents received by the Company or any of its
Restricted Subsidiaries in respect of any Asset Sale, including
any cash or Cash Equivalents received by way of (i) conversion
of any Indebtedness received in connection with such Asset
Sale, (ii) deferred payment of principal pursuant to, or liqui-
dation of, any Indebtedness received in connection with such
Asset Sale or (iii) any dividends on or distributions in
respect of, or the direct or indirect sale, exchange, conver-
sion or other disposition of, any Equity Interests received by
the Company or any of its Restricted Subsidiaries in respect of
any Asset Sale, net of the direct costs relating to such Asset
Sale (including, without limitation, legal, accounting and
investment banking fees, and sales commissions), taxes paid or
payable as a result thereof (after taking into account any
available tax credits or deductions and any tax sharing
arrangements), amounts required to be applied to the repayment
of Indebtedness secured by a lien on the asset or assets that
are the subject of such Asset Sale and any reserve for adjust-
ment in respect of the sale price of such asset or assets.
"New Credit Facility" means the Credit Agreement,
dated as of December 14, 1993, among the Company, the lenders
referred to therein, and The Bank of New York, as agent, as the
same may be amended from time to time, and any agreement evi-
dencing the refinancing, modification, replacement, renewal,
restatement, refunding, deferral, extension, substitution, sup-
plement, reissuance or resale thereof.
"Obligations" means all obligations for principal,
premium, interest, penalties, fees, indemnifications, reim-
bursements, damages and other liabilities payable under the
documentation governing any Indebtedness.
"Officer" means, with respect to any corporation
(including the Company), the Chairman of the Board, the Presi-
dent, any Vice President, the Chief Financial Officer, the
Treasurer or the Secretary of such corporation.
<PAGE>
-12-
"Officer of the Trustee," when used with respect to
the Trustee, means the cashier, any assistant cashier, the
chairman or vice-chairman of the Board of Directors, the chair-
man or vice-chairman of the executive committee of the Board of
Directors, the president, any vice president, any assistant
vice president, the secretary, any assistant secretary, the
controller and any assistant controller, the treasurer, any
assistant treasurer, any trust officer or assistant trust offi-
cer or any other officer of the Trustee customarily performing
functions similar to those performed by any of the above desig-
nated officers, and also means, with respect to a particular
corporate trust matter, any other officer to whom such matter
is referred because of his knowledge of and familiarity with
the particular subject.
"Officers' Certificate" means a written certificate
containing the information specified in Sections 10.04 and
10.05 herein, signed in the name of the Company by any two of
its Officers (one of which shall be, in the case of the Offic-
ers' Certificate delivered pursuant to Section 4.04(a) hereof,
the principal executive officer, principal financial officer or
principal accounting officer of the Company) and delivered to
the Trustee.
"Opinion of Counsel" means a written opinion
addressed to the Trustee and containing the information speci-
fied in Sections 10.04 and 10.05 hereof, rendered by legal
counsel acceptable to the Trustee and delivered to the Trustee.
"Permitted Indebtedness" means: (i) the incurrence
by the Company of Indebtedness under the New Credit Facility in
an aggregate principal amount not to exceed $145 million, less
amounts that have been applied since the date of this Indenture
to permanently reduce the outstanding amount of such Indebted-
ness; (ii) the incurrence by the Company of other Indebtedness
(other than Indebtedness described in clauses (i), (iii) and
(v) hereof) in an aggregate principal amount not to exceed $50
million at any one time outstanding, less any Indebtedness of
Foreign Restricted Subsidiaries incurred pursuant to
clause (vii)(y) (but not clause (vii)(x)) under Section 4.10
hereof; (iii) the incurrence by the Company of Indebtedness
represented by the Securities and the Senior Subordinated
Notes; (iv) Existing Indebtedness of the Company; (v) the
incurrence by the Company of Indebtedness issued in exchange
for, or the proceeds of which are used to extend, refinance,
renew, replace, defease or refund Indebtedness referred to in
clauses (i), (ii), (iii) or (iv) above (the "Refinancing
<PAGE>
-13-
Indebtedness"); provided, however, that (x) the principal
amount of such Refinancing Indebtedness shall not exceed the
principal amount of Indebtedness so extended, refinanced,
renewed, replaced, defeased or refunded, (y) the Refinancing
Indebtedness shall have a Weighted Average Life to Maturity
equal to or greater than the Weighted Average Life to Maturity
of the Indebtedness so extended, refinanced, renewed, replaced,
defeased or refunded and the Securities, and (z) the Refinanc-
ing Indebtedness shall be ranked in right of payment to the
Securities on terms at least as favorable to the holders of
such Securities as those contained in the documentation govern-
ing the Indebtedness so extended, refinanced, renewed,
replaced, defeased or refunded; (vi) intercompany Indebtedness
arising in the ordinary course of business owing by the Company
to its Wholly Owned Restricted Subsidiaries or ARC; (vii) the
incurrence by the Company of Hedging Obligations with respect
to Indebtedness permitted to be incurred by this Indenture;
(viii) Acquired Debt of a Subsidiary existing at the time of
the acquisition of such Subsidiary by the Company or any Sub-
sidiary; provided, however, that (a) such Indebtedness shall
not have been created in contemplation of such acquisition and
(b) after giving pro forma effect to such acquisition, the Com-
pany could incur $1.00 of additional Indebtedness (other than
Permitted Indebtedness) pursuant to the provisions of
Section 4.09 hereof; and (ix) guarantees of Indebtedness of the
Company's Restricted Subsidiaries incurred in accordance with
the provisions of this Indenture.
"Permitted Investments" means: (i) any Investments
in the Company or in a Wholly Owned Restricted Subsidiary of
the Company that is engaged in the same or a similar line of
business as the Company and its Restricted Subsidiaries were
engaged in on the date of this Indenture; (ii) any Investments
in Cash Equivalents; (iii) Investments by the Company or any
Restricted Subsidiary thereof in a Person engaged in the same
or similar line of business as the Company and its Restricted
Subsidiaries were engaged in on the date of this Indenture, if
as a result of such Investment (x) such Person becomes a Wholly
Owned Restricted Subsidiary of the Company and is engaged in
the same or a similar line of business as the Company or the
Restricted Subsidiaries were engaged in on the date of this
Indenture or (y) such Person is merged or consolidated with or
into, or transfers or conveys substantially all of its assets
to, or is liquidated into, the Company or a Wholly Owned
Restricted Subsidiary of the Company that is engaged in the
same or a similar line of business as the Company and its
Restricted Subsidiaries were engaged in on the date of this
<PAGE>
-14-
Indenture; (iv) Investments by the Company or any Restricted
Subsidiary thereof in a Person if (a) no Affiliate of the Com-
pany or a Restricted Subsidiary (other than another Restricted
Subsidiary of the Company) has an Investment in such Person,
(b) such Person is engaged in the same or a similar line of
business as the Company and its Restricted Subsidiaries were
engaged in on the date of this Indenture, (c) the Company
and/or any of its Restricted Subsidiaries at all times owns at
least 50% of the total outstanding shares of Capital Stock of
such Person entitled to participate in distributions in respect
of the earnings, sale or liquidation of such Person,
(d) immediately after giving effect to such Investment on a pro
forma basis (to give effect to the contribution of any property
or assets to such Person or Indebtedness incurred to fund such
Investment or otherwise), the Company could incur at least
$1.00 of additional Indebtedness (other than Permitted Indebt-
edness) pursuant to the provisions of Section 4.09 hereof and
(e) no default with respect to any Indebtedness of such Person
or any Subsidiary of such Person (including any right which the
holders thereof may have to take enforcement action against
such Person) would permit (upon notice, lapse of time or both)
any holder of any Indebtedness of the Company or its Restricted
Subsidiaries to declare a default on such Indebtedness or cause
the payment thereof to be accelerated or payable prior to its
final scheduled maturity; (v) Investments by the Company in any
Person in cash in an aggregate amount not to exceed $30 million
pursuant to contractual commitments in existence as of the date
of this Indenture; and (vi) Investments received by the Company
or its Restricted Subsidiaries as consideration for an Asset
Sale in compliance with the provisions of Section 4.16 hereof.
"Permitted Liens" means: (i) Liens in favor of the
Company; (ii) Liens in favor of the lenders under the New
Credit Facility to secure Obligations of the Company thereun-
der; (iii) Liens on property of a Person existing at the time
such Person is merged into or consolidated with the Company or
any Restricted Subsidiary thereof in a transaction not prohib-
ited by the terms of this Indenture; provided, however, that
such Liens were in existence prior to the contemplation of such
merger or consolidation; (iv) Liens on property existing at the
time of acquisition thereof by the Company or any Restricted
Subsidiary thereof in a transaction not prohibited by the terms
of this Indenture; provided, however, that such Liens were in
existence prior to the contemplation of such acquisition;
(v) Liens to secure the performance of statutory obligations,
surety or appeal bonds, performance bonds or other obligations
of a like nature incurred in the ordinary course of business;
<PAGE>
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(vi) Liens existing on the date of this Indenture; (vii) Liens
for taxes, assessments or governmental charges or claims that
are not yet delinquent or that are being contested in good
faith by appropriate proceedings promptly instituted and dili-
gently concluded; provided, however, that any reserve or other
appropriate provisions as shall be required in conformity with
GAAP shall have been made therefor; (viii) Liens securing pur-
chase money Indebtedness; provided, however, that the principal
amount of the Indebtedness secured by such Liens does not
exceed 100% of such purchase price or cost, such Indebtedness
was permitted to be incurred by the terms of this Indenture and
such Liens do not extend to any assets of the Company and its
Restricted Subsidiaries other than the assets so acquired;
(ix) easements, rights-of-way, restrictions, minor defects or
irregularities in title and other similar charges or encum-
brances not interfering in any material respect with the busi-
ness of the Company or any of its Subsidiaries; (x) Liens upon
specific items of inventory or other goods and proceeds of any
Person securing such Person's obligations in respect of bank-
ers' acceptances issued or created for the account of such Per-
son to facilitate the purchases, shipment or storage of such
inventory or other goods in the ordinary course of business;
(xi) Liens securing reimbursement obligations with respect to
letters of credit which encumber documents and other property
relating to such letters of credit and the products and pro-
ceeds thereof; (xii) Liens in favor of customs and revenue
authorities arising as a matter of law to secure payment of
nondelinquent customs duties in connection with the importation
of goods; (xiii) judgment and attachment Liens not giving rise
to a Default or Event of Default; (xiv) Liens arising out of
consignment or similar arrangements for the sale of goods
entered into by the Company or any Restricted Subsidiary in the
ordinary course of business in accordance with industry prac-
tice; (xv) any interest or title of a lessor in the property
subject to any lease, whether characterized as capitalized or
operating, other than any such interest or title resulting from
or arising out of default by the Company or any Restricted Sub-
sidiary of its obligations under such lease; (xvi) Liens aris-
ing from filing UCC financing statements for precautionary pur-
poses in connection with true leases of personal property that
are otherwise permitted under this Indenture and under which
the Company or any of its Subsidiaries is the lessee;
(xvii) the pledge of stock of Sequa Capital in connection with
the Indebtedness of Sequa Capital referred to in clause (v) of
Section 4.10 hereof; (xviii) Liens created under the Receiv-
ables Agreement; (xix) Liens on assets of Foreign Restricted
Subsidiaries securing Indebtedness permitted by this Indenture;
<PAGE>
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and (xx) extensions, renewals or regranting of any Liens
referred to above in connection with any Refinancing Indebted-
ness permitted under this Indenture.
"Person" means an individual, partnership, corpora-
tion, unincorporated organization, trust or joint venture, or a
governmental agency or subdivision thereof.
"Public Equity Offering" means the first public
offering by the Company of Equity Interests of the Company that
is completed following the date of this Indenture.
"Receivables Agreement" means that certain amended
and restated receivables agreement, dated June 24, 1993, among
the Company, Sequa Receivables Corp. and the other signatories
thereto, and the related purchase and sale agreement and any
successor agreements thereto (including any agreement evidenc-
ing the refinancing, modification, replacement, renewal,
restatement, refunding, deferral, extension, substitution, sup-
plement, reissuance or resale thereof) pursuant to which the
Company may sell up to $100 million of trade receivables on a
non-recourse basis.
"Redemption Date" or "redemption date" means the date
specified for redemption of the Securities in accordance with
the terms of the Securities and this Indenture.
"Redemption Price" or "redemption price" shall have
the meaning set forth in paragraph 5 of the Securities.
"Restricted Investment" means an Investment other
than a Permitted Investment.
"Restricted Subsidiary" means any Subsidiary other
than an Unrestricted Subsidiary.
"SEC" means the Securities and Exchange Commission.
"Securities" means the Securities issued under this
Indenture.
"Senior Debt" means any Indebtedness of the Company
(including any interest accruing subsequent to the filing of a
petition of bankruptcy at the rate provided for in the documen-
tation with respect thereto, to the extent such interest is an
allowed claim under applicable law), whether outstanding on the
date of this Indenture or thereafter created, incurred or
<PAGE>
-17-
assumed, unless, in the case of any particular Indebtedness,
the instrument creating or evidencing the same or pursuant to
which the same is outstanding expressly provides that such
Indebtedness shall not be senior in right of payment to the
Senior Subordinated Notes. Notwithstanding the foregoing,
Senior Debt shall not include: (i) any Indebtedness of the
Company to a Subsidiary of the Company; (ii) any Indebtedness
to, or guaranteed on behalf of, any Affiliate, director, offi-
cer or employee of the Company or any Subsidiary (including,
without limitation, amounts owed for compensation);
(iii) Indebtedness and other amounts incurred in connection
with obtaining goods, materials or services owing to trade
creditors; (iv) Disqualified Stock; (v) any liability for fed-
eral, state, local or other taxes owed or owing by the Company;
(vi) Indebtedness incurred in violation of the provisions of
Section 4.09 hereof; and (vii) any Indebtedness which is, by
its express terms, junior in right of payment to any other
Indebtedness of the Company.
"Senior Subordinated Note Indenture" means that cer-
tain Indenture, dated as of December 15, 1993, between the Com-
pany and Bankers Trust Company, pursuant to which the Senior
Subordinated Notes are issued.
"Senior Subordinated Notes" means the Company's
9-3/8% Senior Subordinated Notes Due December 15, 2003 in the
initial aggregate principal amount of $175,000,000.
"Sequa Capital" means Sequa Capital Corporation, a
New York corporation.
"Stated Maturity," when used with respect to any
security, means the date specified in such security as the
fixed date on which an amount equal to the principal of such
security is due and payable.
"Subordinated Debt" means any Indebtedness that is
subordinated or junior in right of payment to the Securities.
"Subsidiary" means any corporation, association or
other business entity of which more than 50% of the total vot-
ing power of shares of Capital Stock entitled (without regard
to the occurrence of any contingency) to vote in the election
of directors, managers or trustees thereof is at the time owned
or controlled, directly or indirectly, by any person or one or
more of the other Subsidiaries of that person or a combination
thereof.
<PAGE>
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"TIA" means the Trust Indenture Act of 1939, as
amended, and as in effect on the date of this Indenture; pro-
vided, however, that in the event the TIA is amended after such
date, TIA means, to the extent required by any such amendment,
the TIA as so amended.
"Trustee" means the party named as the "Trustee" in
the first paragraph of this Indenture until a successor
replaces it pursuant to the applicable provisions of this
Indenture and, thereafter, shall mean such successor.
"Unrestricted Subsidiary" means (i) any Subsidiary
designated as such by resolution of the Board of Directors
where (x) neither the Company nor any of its other Restricted
Subsidiaries (a) provides credit support for, or guarantee of,
any Indebtedness of such Subsidiary or any Subsidiary of such
Subsidiary (including any undertaking, agreement or instrument
evidencing such Indebtedness) or (b) is directly or indirectly
liable for any Indebtedness of such Subsidiary or any Subsid-
iary of such Subsidiary, and (y) no default with respect to any
Indebtedness of such Subsidiary or any Subsidiary of such Sub-
sidiary (including any right which the holders thereof may have
to take enforcement action against such Subsidiary) would per-
mit (upon notice, lapse of time or both) any holder of any
Indebtedness of the Company and its Restricted Subsidiaries to
declare a default on such Indebtedness or cause the payment
thereof to be accelerated or payable prior to its final sched-
uled maturity and (ii) any Subsidiary of an Unrestricted Sub-
sidiary. The Board of Directors may designate any Restricted
Subsidiary to be an Unrestricted Subsidiary unless such
Restricted Subsidiary owns any Capital Stock of, or owns or
holds any Lien on any property of, any other Subsidiary of the
Company which is not a Subsidiary of the Restricted Subsidiary
to be so designated or otherwise an Unrestricted Subsidiary;
provided, however, that either (i) the designation is made in
accordance with the provisions of Section 4.16(e) hereof,
(ii) the Restricted Subsidiary to be so designated has total
assets of $1,000 or less or (iii) immediately after giving
effect to such designation on a pro forma basis, the Company
could incur at least $1.00 of additional Indebtedness (other
than Permitted Indebtedness) pursuant to the provisions of
Section 4.09 hereof; and provided, further, in the case only of
clause (iii) the Company could make a Restricted Payment in an
amount equal to the greater of the Fair Market Value and the
book value of such Subsidiary pursuant to the provisions of
Section 4.08 hereof and such amount is thereafter treated as a
<PAGE>
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Restricted Payment for the purpose of calculating the aggregate
amount available for Restricted Payments thereunder.
"U.S. Government Obligations" means securities that
are (i) direct obligations of the United States of America for
the timely payment of which its full faith and credit is
pledged or (ii) obligations of a person controlled or super-
vised by and acting as an agency or instrumentality of the
United States of America the timely payment of which is uncon-
ditionally guaranteed as a full faith and credit obligation by
the United States of America which, in either case, are not
callable or redeemable at the option of the issuer thereof, and
shall also include a depository receipt issued by a bank (as
defined in Section 3(a)(2) of the Securities Act), as custodian
with respect to any such U.S. Government Obligation or a spe-
cific payment of principal of or interest on any such U.S.
Government Obligation held by such custodian for the account of
the holder of such depository receipt; provided, however, that
(except as required by law) such custodian is not authorized to
make any deduction from the amount payable to the holder of
such depository receipt from any amount received by the custo-
dian in respect of the U.S. Government Obligation or the spe-
cific payment of principal of or interest on the U.S. Govern-
ment Obligation evidenced by such depository receipt.
"Weighted Average Life to Maturity" means, when
applied to any Indebtedness at any date, the number of years
obtained by dividing (i) the then outstanding aggregate princi-
pal amount of such Indebtedness into (ii) the total of the
product obtained by multiplying (x) the amount of each then
remaining installment, sinking fund, serial maturity or other
required payment of principal, including payment at final
maturity, in respect thereof, by (y) the number of years (cal-
culated to the nearest one-twelfth) which will elapse between
such date and the making of such payment.
"Wholly Owned Restricted Subsidiary" of any Person
means a Restricted Subsidiary of such Person all of the out-
standing Capital Stock or other ownership interests of which
(other than directors' qualifying shares) shall at the time be
owned by such Person or by one or more Wholly Owned Restricted
Subsidiaries of such Person or by such Person and one or more
Wholly Owned Restricted Subsidiaries of such Person.
<PAGE>
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SECTION 1.02. Other Definitions.
Defined in
Term Section
"Act".................................... 1.05
"Affiliate Transaction".................. 4.14
"Change of Control Notice"............... 4.15
"Change of Control Offer"................ 4.15
"Change of Control Payment Date"......... 4.15
"Change of Control Price"................ 4.15
"Covenant Defeasance".................... 8.01
"Event of Default"....................... 6.01
"Investment Grade Ratings"............... 4.19
"Legal Defeasance"....................... 8.01
"Legal Holiday".......................... 10.08
"Notice of Default"...................... 6.01
"Paying Agent"........................... 2.03
"Proceeds Purchase Date"................. 4.16
"Rating Agencies"........................ 4.19
"Register"............................... 2.03
"Registrar".............................. 2.03
"Restricted Payment"..................... 4.08
"Securities Act"......................... 7.04
"Senior Asset Sale Offer"................ 4.16
"Senior Excess Proceeds"................. 4.16
"Suspended Covenants".................... 4.19
"Surviving Corporation".................. 5.01
"U.S. Government Obligations"............ 8.01
SECTION 1.03. Incorporation by Reference of Trust
Indenture Act. Whenever this Indenture refers to a provision
of the TIA, such provision is incorporated by reference in and
made a part of this Indenture. The following TIA terms used in
this Indenture have the following meanings:
"Commission" means the SEC.
"Indenture securities" means the Securities.
"Indenture security holder" means a Securityholder.
"Indenture to be qualified" means this Indenture.
"Indenture trustee" or "institutional trustee" means
the Trustee.
<PAGE>
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"Obligor" on the indenture securities means the Com-
pany and any other obligor upon the securities.
All other TIA terms used in this Indenture that are
defined by the TIA, defined by TIA reference to another statute
or defined by SEC rule have the meanings assigned to them by
such definitions.
SECTION 1.04. Rules of Construction. Unless the
context otherwise requires:
(1) A term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the
meaning assigned to it in accordance with GAAP;
(3) "or" is not exclusive;
(4) "including" means including, without limitation;
and
(5) words in the singular include the plural, and
words in the plural include the singular.
SECTION 1.05. Acts of Holders. (a) Any request,
demand, authorization, direction, notice, consent, waiver or
other action provided by this Indenture to be given or taken by
Holders may be embodied in and evidenced by one or more instru-
ments of substantially similar tenor signed by such Holders in
person or by an agent duly appointed in writing; and, except as
herein otherwise expressly provided, such action shall become
effective when such instrument or instruments are delivered to
the Trustee and, where it is hereby expressly required, to the
Company. Such instrument or instruments (and the action embod-
ied therein and evidenced thereby) are herein sometimes
referred to as the "Act" of Holders signing such instrument or
instruments. Proof of execution of any such instrument or of a
writing appointing any such agent shall be sufficient for any
purpose of this Indenture and conclusive in favor of the Trus-
tee and the Company, if made in the manner provided in this
Section.
(b) The fact and date of the execution by any Person
of any such instrument or writing may be proved in any manner
which the Trustee deems sufficient.
<PAGE>
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(c) The ownership of Securities shall be proved by
the Register of Securities maintained by the Registrar.
(d) Any request, demand, authorization, direction,
notice, consent, waiver or other Act of the Holder of any Secu-
rity shall bind every future Holder of the same Security and
the holder of every Security issued upon the registration of
transfer thereof or in exchange therefor or in lieu thereof in
respect of anything done, omitted or suffered to be done by the
Trustee or the Company in reliance thereon, whether or not
notation of such action is made upon such Security.
(e) If the Company or the Trustee, as the case may
be, shall solicit from the Holders any request, demand, autho-
rization, direction, notice, consent, waiver or other Act, the
Company or the Trustee, as the case may be, may, at its option
(and, in the case of the Company, by or pursuant to a resolu-
tion of its Board of Directors), fix in advance a record date
for the determination of Holders entitled to give such request,
demand, authorization, direction, notice, consent, waiver or
other Act, but neither the Company nor the Trustee shall have
any obligation to do so. If such a record date is fixed, such
request, demand, authorization, direction, notice, consent,
waiver or other Act may be given before or after such record
date, but only the Holders of record at the close of business
on such record date shall be deemed to be Holders for the pur-
poses of determining whether Holders of the requisite propor-
tion of outstanding Securities have authorized or agreed or
consented to such request, demand, authorization, direction,
notice, consent, waiver or other Act, and for that purpose the
outstanding securities shall be computed as of such record
date; provided that no such authorization, agreement or consent
by the Holders on such record date shall be deemed effective
unless it shall become effective pursuant to the provisions of
this Indenture not later than six months after the record date.
ARTICLE 2
THE SECURITIES
SECTION 2.01. Form and Dating. The Securities and
the Trustee's certificate of authentication thereon shall be
substantially in the form of Exhibit A hereto. The Securities
may have notations, legends or endorsements required by law,
<PAGE>
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stock exchange rule or usage. The form of the Securities and
any notation, legend or endorsement shall be in a form accept-
able to the Company. Each Security shall be dated the date of
its authentication.
The terms and provisions contained in the Securities,
annexed hereto as Exhibit A, shall constitute, and are hereby
expressly made, a part of this Indenture. To the extent appli-
cable, the Company and the Trustee, by their execution and
delivery of this Indenture, expressly agree to such terms and
provisions and to be bound thereby.
SECTION 2.02. Execution and Authentication. The
Securities shall be executed on behalf of the Company by its
chairman of the board, its president or one of its vice presi-
dents, under its corporate seal reproduced thereon attested by
its secretary or one of its assistant secretaries. The signa-
ture of any such officer on the Securities may be manual or
facsimile.
Securities bearing the manual or facsimile signatures
of individuals who were at any time the proper Officers of the
Company shall bind the Company, notwithstanding that such indi-
viduals or any of them have ceased to hold such offices prior
to the authentication and delivery of such Securities or did
not hold such offices at the date of such Securities.
No Security shall be entitled to any benefit under
this Indenture or be valid or obligatory for any purpose unless
there appears on such Security a certificate of authentication
substantially in the form provided for in Exhibit A annexed
hereto duly executed by the Trustee by manual signature of an
Officer of the Trustee, and such certificate upon any Security
shall be conclusive evidence, and the only evidence, that such
Security has been duly authenticated and made available for
delivery hereunder.
The Trustee shall, upon a written order of the Com-
pany signed by two Officers, authenticate securities for origi-
nal issue up to an aggregate principal amount stated in para-
graph 4 of the Securities. The aggregate principal amount of
Securities outstanding at any one time may not exceed the
amount set forth herein except as provided in Section 2.07.
The Trustee shall act as the initial authenticating
agent. Thereafter, the Trustee may appoint an authenticating
agent reasonably acceptable to the Company to authenticate
<PAGE>
-24-
Securities. An authenticating agent may authenticate Securi-
ties whenever the Trustee may do so. Each reference in this
Indenture to authentication by the Trustee includes authentica-
tion by such agent. An authenticating agent has the same
rights as a Paying Agent to deal with the Company or an Affili-
ate of the Company.
The Securities shall be issuable only in registered
form without coupons and only in denominations of $1,000 and
any integral multiple thereof.
SECTION 2.03. Registrar and Paying Agent. The Com-
pany shall maintain or cause to be maintained an office or
agency within or without the City of New York, State of New
York where Securities may be presented for registration of
transfer or for exchange ("Registrar"), an office or agency
where Securities may be presented or surrendered for purchase
or payment ("Paying Agent") and an office or agency where
notices and demands to or upon the Company in respect of the
Securities and this Indenture may be served. The Registrar
shall keep a register of the Securities and of their transfer
and exchange (the "Register"). The Company may have one or
more co-registrars and one or more additional paying agents.
The term Paying Agent includes any additional paying agent.
The Trustee shall not be responsible for the acts or omissions
of any Registrar or Paying Agent other than the Trustee.
The Company shall enter into an appropriate agency
agreement with any Registrar, Paying Agent or co-registrar (if
not the Trustee or the Company). The agreement shall implement
the provisions of this Indenture that relate to such agent.
The Company shall notify the Trustee of the name and address of
any such agent. If the Company fails to maintain a Registrar,
Paying Agent or agent for service of notices or demands, the
Trustee shall act as such and shall be entitled to appropriate
compensation therefor pursuant to Section 7.07 hereof. The
Company or any Subsidiary or an Affiliate of either of them may
act as Paying Agent, Registrar or co-registrar or agent for
service of notices and demands.
The Company initially appoints the Trustee as Regis-
trar and Paying Agent and agent for service of notices and
demands.
SECTION 2.04. Paying Agent to Hold Money in Trust.
Except as otherwise provided herein, prior to or on each due
date of the principal, premium, if any, and interest on any
<PAGE>
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Security, the Company (or any other obligor on the Securities)
shall deposit with the Paying Agent a sum of money sufficient
to pay such principal, premium, if any, and interest so becom-
ing due. The Company and any other obligor on the Securities
shall require each Paying Agent (other than the Trustee or the
Company) to agree in writing that such Paying Agent shall hold
in trust for the benefit of Securityholders or the Trustee all
money held by the Paying Agent for the payment of principal,
premium, if any, and interest on the Securities (whether such
money has been paid to it by the Company or any other obligor
on the Securities) and shall notify the Trustee of any default
by the Company or by any other obligor on the Securities in
making any such payment. At any time during the continuance of
any such default, the Paying Agent shall, upon the request of
the Trustee, forthwith pay to the Trustee all money so held in
trust and account for any money disbursed by it. The Company
and any other obligor on the Securities at any time may require
a Paying Agent to pay all money held by it to the Trustee and
to account for any money disbursed by it. Upon doing so, the
Paying Agent shall have no further liability for the money so
paid over to the Trustee. If the Company, a Subsidiary or an
Affiliate of any of them acts as Paying Agent, it shall segre-
gate the money held by it as Paying Agent and hold it as a
separate trust fund.
SECTION 2.05. Securityholder Lists. The Trustee
shall preserve in as current a form as is reasonably practi-
cable, the most recent list available to it of the names and
addresses of Securityholders. If the Trustee is not the Regis-
trar, the Company or any other obligor upon the Securities
shall cause to be furnished to the Trustee at least 15 days
before each interest payment date and at such other times as
the Trustee may request in writing, within 10 days of such
request, a list, in such form as the Trustee may reasonably
require, of the names and addresses of Securityholders.
SECTION 2.06. Transfer and Exchange. Upon surrender
for registration of transfer of any Security at the office or
agency of the Company designated as Registrar or co-registrar
pursuant to Section 2.03, the Company shall execute, and the
Trustee shall authenticate and make available for delivery, in
the name of the designated transferee or transferees, one or
more new Securities of any authorized denomination or denomina-
tions, of a like aggregate principal amount.
At the option of the Holder, Securities may be
exchanged for other Securities of any authorized denomination
<PAGE>
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or denominations, of a like aggregate principal amount, upon
surrender of the Securities to be exchanged at such office or
agency. Whenever any Securities are so surrendered for
exchange, the Company shall execute, and the Trustee shall
authenticate and make available for delivery, the Securities
which the Holder making the exchange is entitled to receive.
Every Security presented or surrendered for registra-
tion of transfer or for exchange shall be duly endorsed, or be
accompanied by a written instrument of transfer in form satis-
factory to the Company and the Registrar duly executed by the
Holder or his attorney or legal representative duly authorized
in writing. Any transfer or exchange shall be without charge
to the Holders, except the Company may require payment of a sum
sufficient to pay all taxes, assessments or other governmental
charges that may be imposed in connection with such transfer or
exchange from the Securityholder requesting such transfer or
exchange (other than any exchange of a temporary Security for a
definitive Security not involving any change in ownership).
The Company or the Registrar, as the case may be,
shall not be required (i) to issue, register the transfer of or
exchange the Securities during a period beginning at the open-
ing of business 15 days before the day of any selection of
Securities for redemption under Section 3.02 and ending at the
close of business on the day of the selection, or (ii) to reg-
ister the transfer or exchange of any Securities so selected
for redemption (except, in the case of Securities to be
redeemed in part, the portion thereof not to be redeemed).
SECTION 2.07. Replacement Securities. If (a) any
mutilated Security is surrendered to the Company or the Trus-
tee, or (b) the Company and the Trustee receive evidence to
their satisfaction of the destruction, loss or theft of any
Security, and there is delivered to the Company and the Trustee
such security or indemnity as may be required by them to save
each of them harmless, then, in the absence of notice to the
Company or the Trustee that such Security has been acquired by
a bona fide purchaser, the Company shall execute, and upon the
Company's written request, the Trustee shall authenticate and
make available for delivery, in exchange for any such mutilated
Security or in lieu of any such destroyed, lost or stolen Secu-
rity, a new Security of like tenor and principal amount, bear-
ing a number not contemporaneously outstanding.
In case any such mutilated, destroyed, lost or stolen
Security has become or is about to become due and payable, or
<PAGE>
-27-
is about to be redeemed by the Company pursuant to Article 3
hereof, the Company in its discretion may, instead of issuing a
new Security, pay or purchase such Security, as the case may
be, except in the case of any Securities to be redeemed in
part, the portion thereof not to be redeemed.
Upon the issuance of any new Securities under this
Section 2.07, the Company may require the payment of a sum suf-
ficient to cover any tax or other governmental charge that may
be imposed in relation thereto and any other expenses (includ-
ing the fees and expenses of the Trustee) in connection
therewith.
Every new Security issued pursuant to this Section
2.07 in lieu of any mutilated, destroyed, lost or stolen Secu-
rity shall constitute an original additional contractual obli-
gation of the Company whether or not the mutilated, destroyed,
lost or stolen Security shall be at any time enforceable by
anyone, and shall be entitled to all benefits of this Indenture
equally and proportionately with any and all other Securities
duly issued hereunder.
The provisions of this Section 2.07 are exclusive and
shall preclude (to the extent lawful) all other rights and
remedies with respect to the replacement or payment of muti-
lated, destroyed, lost or stolen Securities.
SECTION 2.08. Outstanding Securities; Determinations
of Holders' Action. Securities outstanding at any time are all
the Securities authenticated by the Trustee except for those
canceled by it, those delivered to it for cancellation, those
referred to in Section 2.07 hereof, or purchased by the Company
pursuant to Article 3 hereof and those described in this Sec-
tion 2.08 as not outstanding. A Security does not cease to be
outstanding because the Company or an Affiliate thereof holds
the Security; provided, however, that in determining whether
the Holders of the requisite principal amount of Securities
have given or concurred in any request, demand, authorization,
direction, notice, consent or waiver hereunder, Securities
owned by the Company, any other obligor upon the Securities or
any Affiliate of the Company or such other obligor shall be
disregarded and deemed not to be outstanding, except that, in
determining whether the Trustee shall be protected in relying
upon any such request, demand, authorization, direction,
notice, consent or waiver, only Securities the ownership of
which by the Company or any Affiliate of the Company the Trus-
tee has actual written knowledge of shall be so disregarded.
<PAGE>
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Subject to the foregoing, only Securities outstanding at the
time of such determination shall be considered in any such
determination (including determinations pursuant to Articles 6
and 9).
If a Security is replaced pursuant to Section 2.07,
it ceases to be outstanding unless the Trustee receives proof
satisfactory to it that the replaced Security is held by a bona
fide purchaser.
If the Paying Agent (other than the Company) holds,
in accordance with this Indenture, at maturity or on a redemp-
tion date, money sufficient to pay the Securities payable on
that date, then immediately on the date of maturity or such
redemption date, as the case may be, such Securities shall
cease to be outstanding and interest, if any, on such Securi-
ties shall cease to accrue.
SECTION 2.09. Temporary Securities. Pending the
preparation of definitive Securities, the Company may execute,
and upon written request from the Company signed by two Offic-
ers of the Company, the Trustee shall authenticate and make
available for delivery, temporary Securities which are printed,
lithographed, typewritten, mimeographed or otherwise produced,
in any authorized denomination, substantially of the tenor of
the definitive Securities in lieu of which they are issued and
with such appropriate insertions, omissions, substitutions and
other variations as the Officers of the Company executing such
Securities may determine, as conclusively evidenced by their
execution of such Securities.
If temporary Securities are issued, the Company will
cause definitive Securities to be prepared without unreasonable
delay and exchange the temporary Securities for definitive
Securities upon surrender of the temporary Securities at the
office or agency of the Company designated for such purpose
pursuant to Section 2.03 hereof, without charge to the Holder.
Until so exchanged, the temporary Securities shall in all
respects be entitled to the same benefits under this Indenture
as definitive Securities.
SECTION 2.10. Cancellation. The Company may at any
time deliver to the Trustee for cancellation any Securities
previously authenticated and made available for delivery here-
under which the Company may have acquired in any manner whatso-
ever, and all Securities so delivered shall be promptly can-
celed by the Trustee. The Company may not reissue, or issue
<PAGE>
-29-
new Securities to replace Securities it has paid or delivered
to the Trustee for cancellation. No Securities shall be
authenticated in lieu of or in exchange for any Securities can-
celed as provided in this Section 2.10, except as expressly
permitted by this Indenture. All canceled Securities held by
the Trustee shall be destroyed by the Trustee, provided that
all regulatory requirements relating to the destruction of cer-
tificates are complied with, and a certificate of destruction
is delivered to the Company.
SECTION 2.11. CUSIP Numbers. The Company in issu-
ing the Securities may use "CUSIP" numbers (if then generally
in use), and the Trustee shall use CUSIP numbers in notices of
redemption or exchange as a convenience to Holders; provided
that any such notice shall state that no representation is made
as to the correctness of such numbers either as printed on the
Securities or as contained in any notice of redemption or
exchange and that reliance may be placed only on the other
identification numbers printed on the Securities and any
redemption shall not be affected by any defect in or omission
of such numbers.
SECTION 2.12. Defaulted Interest. If the Company
defaults in a payment of interest on the Securities, it shall
pay the defaulted interest, plus (to the extent lawful) any
interest payable on the defaulted interest, to the Persons who
are Holders on a subsequent special record date, which shall be
not less than five Business Days prior to the date of payment
of such defaulted interest. The subsequent special record date
and payment date shall be determined by the Trustee. At least
15 days before the subsequent special record date, the Trustee
shall mail to each Holder a notice that states the subsequent
special record date, the payment date and the amount of
defaulted interest to be paid. The Company may also pay
defaulted interest in any other lawful manner.
ARTICLE 3
REDEMPTION
SECTION 3.01. Right to Redeem; Notices to Trustee.
At any time on and after December 15, 1997, the Company, at its
option, may redeem the Securities in whole or in part in accor-
dance with this Article 3 and the provisions of the first
<PAGE>
-30-
paragraph of paragraph 5 of the Securities. If the Company
elects to redeem Securities pursuant to paragraph 5 of the
Securities, it shall notify the Trustee in writing of the
Redemption Date, the principal amount of Securities to be
redeemed, the Redemption Price and, in the case of a redemption
pursuant to Section 3.02 hereof, the date of the closing of the
Public Equity Offering.
The Company shall give the notice to the Trustee pro-
vided for in this Section 3.01 at least 45 days before the
Redemption Date (unless a shorter notice shall be satisfactory
to the Trustee in its sole discretion).
SECTION 3.02. Public Equity Offering Redemption. In
addition to the optional redemption of the Securities provided
for in the first paragraph of paragraph 5 of the Securities, on
or prior to December 15, 1996, the Company may redeem up to 20%
of the principal amount of the Securities originally issued
under this Indenture with the net proceeds of a Public Equity
Offering at a redemption price equal to 108.750% of the princi-
pal amount thereof, plus accrued and unpaid interest, if any,
to the Redemption Date; provided, however, that at least 80% of
the principal amount of Securities originally issued under this
Indenture remains outstanding immediately after the occurrence
of such redemption; provided, further, that such redemption
shall occur within 45 days after the date of the closing of the
Public Equity Offering; and provided, further, that the Trustee
shall receive notice of such redemption at least 15 days before
notices are to be mailed.
SECTION 3.03. Mandatory Redemption. Subject to the
Company's obligation to make an offer to repurchase the Securi-
ties pursuant to Sections 4.15 and 4.16 hereof, the Company
shall have no mandatory redemption or sinking fund obligations
with respect to the Securities.
SECTION 3.04. Selection of Securities to Be
Redeemed. If less than all the outstanding Securities are to
be redeemed at any time, the Trustee shall select the Securi-
ties to be redeemed in compliance with the requirements of the
principal national securities exchange, if any, on which the
Securities are listed, or, if the Securities are not so listed,
by lot; provided that no such Securities in principal amounts
of $1,000 or less shall be redeemed in part. The Trustee shall
make the selection at least 40 days but not more than 60 days
before the Redemption Date from outstanding Securities not pre-
viously called for redemption. Securities and portions of them
<PAGE>
-31-
the Trustee selects shall be in principal amounts of $1,000 or
an integral multiple of $1,000. Provisions of this Indenture
that apply to Securities called for redemption also apply to
portions of Securities called for redemption. The Trustee
shall notify the Company promptly of the Securities or portions
of Securities to be redeemed.
SECTION 3.05. Notice of Redemption. At least 30
days but not more than 60 days before a Redemption Date, the
Company shall mail or cause to be mailed a notice of redemption
by first-class mail, postage prepaid, to each Securityholder at
the Securityholder's last address, as it shall appear on the
Register. A copy of such notice shall be mailed to the Trustee
on the same day the notice is mailed to the Securityholders.
The notice shall identify the Securities to be
redeemed and shall state:
(1) the Redemption Date;
(2) the Redemption Price and the amount of accrued
interest to be paid, if any;
(3) the CUSIP number (subject to the provisions of
Section 2.11 hereof);
(4) the name and address of the Paying Agent;
(5) that Securities called for redemption must be
surrendered to the Paying Agent to collect the Redemption Price
and the amount of accrued interest to be paid, if any;
(6) if fewer than all the outstanding Securities are
to be redeemed, the identification and principal amounts of the
particular Securities to be redeemed and that upon surrender of
such Security, a new Security in a principal amount equal to
the unredeemed portion thereof will be issued;
(7) that, unless the Company defaults in making such
redemption payment, interest will cease to accrue on Securities
called for redemption on and after the Redemption Date; and
(8) in the case of a redemption pursuant to Section
3.02 hereof, the date of the closing of the Public Equity
Offering.
<PAGE>
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At the Company's written request, which request shall
be received by the Trustee at least 45 days before the Redemp-
tion Date (unless a shorter notice shall be satisfactory to the
Trustee in its sole discretion) the Trustee shall give the
notice of redemption in the Company's name and at the Company's
expense; provided, however, that, at the sole discretion of the
Trustee and within 5 days after the request by the Trustee, in
all cases the text of such notice of redemption shall be pre-
pared or approved by the Company and the Trustee shall have no
responsibility whatsoever with regard to such notice being
accurate or correct.
SECTION 3.06. Effect of Notice of Redemption. Once
notice of redemption is given, Securities called for redemption
become due and payable on the Redemption Date and at the
Redemption Price. Upon the later of the Redemption Date and
the date such Securities are surrendered to the Paying Agent,
such Securities called for redemption shall be paid at the
Redemption Price plus accrued interest, if any, to the Redemp-
tion Date.
Notice of redemption shall be deemed to be given when
mailed, whether or not the Holder receives the notice. In any
event, failure to give such notice, or any defect therein,
shall not affect the validity of the proceedings for the
redemption of the Securities.
SECTION 3.07. Deposit of Redemption Price. Prior to
or on the Redemption Date, the Company shall deposit in immedi-
ately available funds with the Paying Agent (or if the Company
or a Subsidiary or an Affiliate of either of them is the Paying
Agent, shall segregate and hold in trust) money sufficient to
pay the Redemption Price of all Securities to be redeemed on
that date other than Securities or portions of Securities
called for redemption which prior thereto have been delivered
by the Company to the Trustee for cancellation.
SECTION 3.08. Securities Redeemed in Part. Upon
surrender of a Security that is redeemed in part, the Company
shall execute, and the Trustee shall authenticate and make
available for delivery to the Holder, a new Security in an
authorized denomination equal in principal amount to the
unredeemed portion of the Security surrendered.
<PAGE>
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ARTICLE 4
COVENANTS
SECTION 4.01. Payment of Securities. The Company
shall pay the principal of, premium, if any, and interest
(including interest accruing on or after the filing of a peti-
tion in bankruptcy or reorganization relating to the Company,
whether or not a claim for post-filing interest is allowed in
such proceeding) on the Securities on (or prior to) the dates
and in the manner provided in the Securities or pursuant to
this Indenture. An installment of principal, premium, if any,
or interest shall be considered paid on the applicable date due
if on such date the Trustee or the Paying Agent holds, in
accordance with this Indenture, money sufficient to pay all of
such installment then due. The Company shall pay interest on
overdue principal and premium, if any, and interest on overdue
installments of interest (including interest accruing on or
after the filing of a petition in bankruptcy or reorganization
relating to the Company whether or not a claim for post-filing
interest is allowed in such proceeding), to the extent lawful,
at the rate per annum borne by the Securities, which interest
on overdue interest shall accrue from the date such amounts
became overdue.
SECTION 4.02. [Intentionally Omitted]
SECTION 4.03. SEC Reports. The Company shall
deliver to the Trustee and to each Holder, within 15 days after
it files the same with the SEC, copies of its annual and quar-
terly reports, information, documents and other reports (or
copies of such portions of any of the foregoing as the SEC may
by rules and regulations prescribe) which the Company is
required to file with the SEC pursuant to Section 13 or 15(d)
of the Exchange Act. In the event that the Company is at any
time not subject to the reporting requirements of the Exchange
Act, it shall provide to the Trustee and shall deliver to each
Holder, within 15 days after it would have been required to
file such information with the SEC had it continued to be sub-
ject to the reporting requirements of the Exchange Act, finan-
cial statements and any notes thereto (and, with respect to
annual reports, an auditors' report by an accounting firm of
established national reputation) and a "Management's Discussion
and Analysis of Financial Condition and Results of Operations,"
comparable to that which the Company would have been required
to file if it were subject to the requirements of such Section
<PAGE>
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13 or 15(d) of the Exchange Act. The Company shall also comply
with the other provisions of TIA Section 314(a).
SECTION 4.04. Compliance Certificates. (a) The
Company shall deliver to the Trustee, within 90 days after the
end of each fiscal year and within 60 days after the end of
each fiscal quarter of the Company, an Officers' Certificate
stating that a review of the activities of the Company and its
Subsidiaries during the preceding fiscal period has been made
under the supervision of the signing officers with a view to
determining whether the Company has kept, observed, performed
and fulfilled its obligations under this Indenture, and further
stating, as to each such Officer signing such certificate, that
to the best of his knowledge the Company has kept, observed,
performed and fulfilled each and every covenant contained in
this Indenture and is not in default in the performance or
observance of any of the terms, provisions and conditions
hereof (or, if a Default or Event of Default shall have
occurred, describing all such Defaults or Events of Default of
which he may have knowledge) and that to the best of his knowl-
edge no event has occurred and remains in existence by reason
of which payments on account of the principal of or interest,
if any, on the Securities are prohibited or if such event has
occurred, a description of the event.
(b) So long as not contrary to the then current rec-
ommendations of the American Institute of Certified Public
Accountants as reported to the Trustee in a letter from the
Company's independent public accountants, the annual financial
statements delivered pursuant to Section 4.03 shall be accompa-
nied by a written statement of the Company's independent public
accountants (which shall be a firm of established national rep-
utation) that in making the examination necessary for certifi-
cation of such financial statements, nothing has come to their
attention which would lead them to believe that the Company has
violated any provisions of Article 4 or 5 of this Indenture or,
if any such violation has occurred, specifying the nature and
period of existence thereof.
(c) The Company and any other obligor upon the Secu-
rities will, so long as any of the Securities are outstanding,
deliver to the Trustee, forthwith upon becoming aware of (i)
any Default, Event of Default or default in the performance of
any covenant, agreement or condition contained in this Inden-
ture or (ii) any event of default under any other mortgage,
indenture or instrument as such terms are used in Section
<PAGE>
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6.01(4), an Officers' Certificate specifying such Default,
Event of Default or default.
SECTION 4.05. Payment of Taxes and Other Claims.
The Company shall pay or discharge or cause to be paid or dis-
charged, before any penalty accrues thereon, (i) all material
taxes, assessments and governmental charges levied or imposed
upon the Company or any Subsidiary upon the income, profits or
property of the Company or any Subsidiary, and (ii) all mate-
rial lawful claims for labor, materials and supplies which, if
unpaid, would by law become a Lien upon the property of the
Company or any Subsidiary; provided that none of the Company or
any Subsidiary shall be required to pay or discharge or cause
to be paid or discharged any such tax, assessment, charge or
claims the amount, applicability or validity of which is being
contested in good faith by appropriate proceedings and for
which adequate provision has been made or where the failure to
effect such payment or discharge is not adverse in any material
respect to the Holders.
SECTION 4.06. Waiver of Stay, Extension or Usury
Laws. The Company covenants (to the extent that it may law-
fully do so) that it will not at any time insist upon, or
plead, or in any manner whatsoever claim or take the benefit or
advantage of, any stay or extension law or any usury or other
law wherever enacted, now or at any time hereafter in force,
that would prohibit or forgive the Company from paying all or
any portion of the principal or premium, if any, or interest on
the Securities as contemplated herein or affect the covenants
or the performance by the Company of its obligations under this
Indenture; and the Company (to the extent that it may lawfully
do so) hereby expressly waives all benefit or advantage of any
such law, and covenants that it will not hinder, delay or
impede the execution of any power herein granted to the Trus-
tee, but will suffer and permit the execution of every such
power as though no such law had been enacted.
SECTION 4.07. Corporate Existence. Subject to
Article 5 hereof, the Company will, and will cause each of its
Subsidiaries to, do or cause to be done all things reasonably
necessary to preserve and keep in full force and effect their
respective corporate existence in accordance with the respec-
tive organizational documents and the rights (charter and
statutory), licenses and franchises of the Company and its Sub-
sidiaries; provided, however, that neither the Company nor any
such Subsidiary shall be required to preserve any such right,
license or franchise, if the Board of Directors of the Company
<PAGE>
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shall determine that the preservation thereof is no longer
desirable or necessary in the conduct of the business of the
Company and its Subsidiaries taken as a whole, and that the
loss thereof is not adverse in any material respect to the
Holders.
SECTION 4.08. Limitation on Restricted Payments.
The Company will not, and will not permit any of its Restricted
Subsidiaries to, directly or indirectly: (i) declare or pay
any dividend or make any distribution on account of the Compa-
ny's or such Restricted Subsidiary's Equity Interests (other
than dividends or distributions payable in Equity Interests
(other than Disqualified Stock) of the Company or such
Restricted Subsidiary or dividends or distributions payable to
the Company or any Wholly Owned Restricted Subsidiary of the
Company); (ii) purchase, redeem or otherwise acquire or retire
for value any Equity Interests of the Company, or any Subsid-
iary or other Affiliate of the Company (other than any such
Equity Interests owned by the Company or any Wholly Owned
Restricted Subsidiary of the Company and other than as
described in clauses (iii) and (iv) of the definition of "Per-
mitted Investments"); (iii) make any principal payment on, pur-
chase, redeem, retire, defease, prepay, decrease or otherwise
acquire or retire for value prior to a scheduled final matur-
ity, scheduled repayment or scheduled mandatory sinking fund
payment date or maturity date (A) any Indebtedness of the Com-
pany that is subordinated or junior in right of payment to the
Securities or (B) any Indebtedness of the Company's Unre-
stricted Subsidiaries; or (iv) make any Restricted Investment
(all such payments and other actions set forth in clauses (i)
through (iv) above being collectively referred to as
"Restricted Payments"), unless, at the time of such Restricted
Payment:
(a) no Default or Event of Default shall
have occurred and be continuing or would
occur as a consequence thereof; and
(b) the Company would, at the time of
such Restricted Payment and after giving pro
forma effect thereto as if such Restricted
Payment had been made at the beginning of the
applicable Four Quarter Period, have been
permitted to incur at least $1.00 of addi-
tional Indebtedness (other than Permitted
Indebtedness) pursuant to the provisions of
Section 4.09; and
<PAGE>
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(c) such Restricted Payment, together
with the aggregate of all other Restricted
Payments made by the Company and its
Restricted Subsidiaries from December 22,
1993, is less than the sum of (x) $50 million
plus 50% of cumulative Consolidated Net
Income of the Company for the period (taken
as one accounting period) from January 1,
1994 (or, if such Consolidated Net Income for
such period is a deficit, minus 100% of such
deficit) plus (y) 100% of the aggregate net
cash proceeds received by the Company from
any Person (other than a Subsidiary of the
Company), from the issue or sale of Equity
Interests (other than Disqualified Stock) of
the Company and the principal amount of debt
securities of the Company that have been con-
verted into Equity Interests (other than Dis-
qualified Stock) of the Company (other than
by a Subsidiary of the Company) subsequent to
January 1, 1994.
The foregoing provisions will not prohibit: (i) the
payment of any dividend or making of any distribution within 60
days after the date of declaration thereof, if at the date of
declaration such dividend or distribution would have complied
with the provisions of this Indenture; (ii) the redemption,
retirement or repurchase of Indebtedness of the Company and its
Subsidiaries with the proceeds of the offering of the Securi-
ties; (iii) the redemption, retirement or repurchase of the
Company's 10>% Senior Subordinated Notes due 1998 in compliance
with the provisions of Section 4.16 hereof; (iv) the purchase
for value of shares of Capital Stock or warrants, options or
other rights to acquire Capital Stock held by directors, offic-
ers or employees of the Company or a Restricted Subsidiary upon
death, disability, retirement or termination of employment in
an aggregate amount not to exceed $500,000 in any twelve-month
period; or (v) the repurchase of the ARC Minority Interest for
aggregate consideration not to exceed $20 million; provided,
however, that in the case of clauses (ii), (iii), (iv) and (v),
no Default or Event of Default shall have occurred or be con-
tinuing at the time of such payment or as a result thereof.
SECTION 4.09. Limitation on Additional Indebtedness.
The Company will not, directly or indirectly, create, incur,
issue, assume, guaranty or otherwise become directly or indi-
rectly liable, contingently or otherwise, or otherwise become
<PAGE>
-38-
responsible for (collectively, "incur"), any Indebtedness
(including Acquired Debt), other than Permitted Indebtedness
and the Company will not issue any Disqualified Stock; pro-
vided, however, that the Company may incur Indebtedness or
issue shares of Disqualified Stock if the Consolidated Interest
Coverage Ratio of the Company for the applicable Four Quarter
Period would have been at least 2.0 to 1.0 after giving pro
forma effect to such incurrence or issuance as if it had
occurred at the beginning of such Four Quarter Period.
SECTION 4.10. Limitation on Indebtedness and Dis-
qualified Stock of Restricted Subsidiaries. The Company will
not cause or permit any Restricted Subsidiary of the Company to
incur any Indebtedness or issue any shares of Capital Stock, or
securities convertible or exchangeable into, or options, war-
rants, rights or any other interests with respect to, Capital
Stock, except for: (i) Indebtedness owed by a Restricted Sub-
sidiary of the Company to the Company or another Wholly Owned
Restricted Subsidiary of the Company (provided that such
Indebtedness is at all times held by the Company or a Wholly
Owned Restricted Subsidiary of the Company); (ii) Acquired Debt
of a Restricted Subsidiary existing at the time of the acquisi-
tion of such Restricted Subsidiary by the Company or any
Restricted Subsidiary; provided, however, that (x) such Indebt-
edness shall not have been created in contemplation of such
acquisition and (y) after giving pro forma effect to such
acquisition as if it had occurred at the beginning of the
applicable Four Quarter Period, the Company could incur $1.00
of additional Indebtedness (other than Permitted Indebtedness)
pursuant to the provisions of Section 4.09 hereof; (iii) guar-
antees of the Obligations of the Company under the New Credit
Facility; (iv) Existing Indebtedness of the Restricted Subsid-
iaries and Refinancing Indebtedness with respect thereto that
satisfies the requirements of clause (v) of the definition of
Permitted Indebtedness; (v) Indebtedness of Sequa Capital
secured by a pledge of the capital stock of Sequa Capital; pro-
vided, however, such Indebtedness also is nonrecourse to Sequa
Capital and the Company and its Restricted Subsidiaries (sub-
ject to the right of a lender to be indemnified for breaches of
representations or warranties); (vi) intercompany Indebtedness
arising in the ordinary course of business of ARC owing to the
Company; (vii) Indebtedness incurred by Foreign Restricted Sub-
sidiaries in an amount not to exceed $75 million at any one
time outstanding, provided that after giving pro forma effect
to the incurrence of such Indebtedness as if it had occurred at
the beginning of the applicable Four Quarter Period, (x) the
Company could incur $1.00 of additional Indebtedness (other
<PAGE>
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than Permitted Indebtedness) pursuant to the provisions of Sec-
tion 4.09 hereof or (y) such Indebtedness, if it had been
incurred directly by the Company, could have been incurred pur-
suant to clause (ii) of the definition of Permitted Indebted-
ness or (viii) the incurrence by a Restricted Subsidiary of
Hedging Obligations with respect to Indebtedness permitted to
be incurred by this Indenture.
SECTION 4.11. Limitation on Liens. The Company will
not, and will not permit any of its Restricted Subsidiaries to,
directly or indirectly, create, incur, assume or suffer to
exist any Lien (other than a Permitted Lien and Liens arising
in connection with sale and leaseback transactions permitted by
Section 4.13 hereof) on any asset now owned or hereafter
acquired, or on any income or profits earned therefrom or
assign or convey any right to receive income or profits there-
from, to secure obligations without making effective provision
for securing the Securities (and, if the Company shall so
determine, any other Indebtedness of the Company, including
Subordinated Debt, provided that Liens securing the Securities
and any other Senior Debt are senior to Liens securing such
Subordinated Debt) (i) equally and ratably with the obligations
so secured as to such assets or income or profits for so long
as such obligations will be so secured or (ii) in the event
such obligations are in respect of Subordinated Debt, prior to
such Subordinated Debt as to such assets or income or profits
for so long as such Subordinated Debt will be so secured.
SECTION 4.12. Limitation on Dividend and Other Pay-
ment Restrictions Affecting Restricted Subsidiaries. The Com-
pany will not, and will not permit any of its Restricted Sub-
sidiaries to, directly or indirectly, create or otherwise cause
or suffer to exist or become effective any encumbrance or
restriction of any kind on the ability of any Restricted Sub-
sidiary to: (i) pay dividends or make any other distributions
to the Company or any of its Restricted Subsidiaries (x) on its
Capital Stock or (y) with respect to any other interest or par-
ticipation in, or measured by, its profits; (ii) pay any
Indebtedness or other obligations owed to the Company or any of
its Restricted Subsidiaries; (iii) make loans or advances to
the Company or any of its Restricted Subsidiaries; or (iv)
transfer any of its properties or assets to the Company or any
of its Restricted Subsidiaries, except for such encumbrances or
restrictions existing under or by reasons of (A) applicable
law; (B) Existing Indebtedness of Restricted Subsidiaries of
the Company and Refinancing Indebtedness with respect thereto
that satisfies the requirements of clause (v) of the definition
<PAGE>
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of "Permitted Indebtedness"; provided, however, that the provi-
sions contained in any modified or amended agreement relating
to such Refinancing Indebtedness are no more restrictive in any
material respect than the provisions contained in such agree-
ment on the date of this Indenture; (C) the ARC Stock Purchase
and Restriction Agreement as in effect on the date of this
Indenture, or as it may be modified or amended subsequent to
the date of the Indenture; provided, however, that the provi-
sions contained in any modified or amended agreement relating
to such encumbrance or restriction are no more restrictive in
any material respect than the provisions contained in such
agreement on the date of this Indenture; (D) the Receivables
Agreement; provided, however, that the provisions contained in
any modified or amended agreement relating to such encumbrance
or restriction are no more restrictive in any material respect
than the provisions contained in such agreement on the date of
this Indenture; (E) the agreement under which the Indebtedness
referred to in clause (v) under Section 4.10 hereof is
incurred, including any successor agreement and any agreement
evidencing the refinancing, modification, replacement, renewal,
restatement, refunding, deferral, extension, substitution, sup-
plement, reissuance or resale thereof; provided, however, that
the provisions contained in any such agreement are no more
restrictive in any material respect than the provisions con-
tained in the agreement in effect on the date of this Inden-
ture; or (F) by reason of customary non-assignment provisions
in leases entered into in the ordinary course of business and
consistent with past practices.
SECTION 4.13. Limitation on Sale and Leaseback
Transactions. The Company will not, and will not permit any of
its Restricted Subsidiaries to, enter into any arrangement with
any Person providing for leasing by the Company or any of its
Restricted Subsidiaries of any real property or tangible per-
sonal property, which property has been or is to be sold or
transferred by the Company or any of its Restricted Subsidiar-
ies to such Person in contemplation of such leasing; provided,
however, the Company may enter into any such arrangement if (i)
the Company is permitted to dispose of such asset in compliance
with the provisions of Section 4.16 hereof, (ii) the Net Pro-
ceeds of any such sale or transfer are at least equal to the
Fair Market Value of such property, and (iii) (x) the Company
would be entitled, under the provisions of Sections 4.09 and
4.11 hereof, to incur secured Indebtedness in an amount equal
to the Attributable Indebtedness with respect to such arrange-
ment or (y) the Company applies the Net Proceeds of such sale
as provided under Section 4.16 hereof.
<PAGE>
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SECTION 4.14. Limitation on Transactions with Affil-
iates. The Company will not, and will not permit any of its
Restricted Subsidiaries to, sell, lease, transfer or otherwise
dispose of any of its properties or assets to, or purchase any
property or assets from, or enter into any transaction, con-
tract, agreement, understanding, loan, advance or guarantee
with, or for the benefit of, any Affiliate (each of the fore-
going, an "Affiliate Transaction"), unless (i) such Affiliate
Transaction is on terms that are no less favorable to the Com-
pany or Restricted Subsidiary than those that would have been
obtained on an arms-length basis in a comparable transaction by
the Company or Restricted Subsidiary with an unrelated person
and (ii) prior to the consummation of any such Affiliate Trans-
action, the Company delivers to the Trustee (x) with respect to
any Affiliate Transaction or series of related Affiliate Trans-
actions involving aggregate payments in excess of $1.0 million,
a resolution of the disinterested members of the Board of
Directors set forth in an Officers' Certificate certifying that
such Affiliate Transaction complies with clause (i) above and
that such Affiliate Transaction was approved by a majority of
the disinterested members of the Board of Directors and (y)
with respect to any Affiliate Transaction involving aggregate
payments in excess of $10.0 million, in addition to the
requirements specified in clause (x), a written opinion as to
the fairness of such Affiliate Transaction to the Company or
such Restricted Subsidiary from a financial point of view
issued by an investment banking firm of national standing or in
the case of a transaction involving the sale or transfer of
assets subject to valuation, such as real estate, a written
appraisal by a nationally recognized appraisal firm; provided,
however, that the following shall not be deemed to be Affiliate
Transactions: (i) any employment agreement entered into by the
Company or any of its Restricted Subsidiaries in the ordinary
course of business and consistent with the past practice of the
Company or such Restricted Subsidiary, (ii) transactions per-
mitted by Section 4.08 hereof, and (iii) transactions between
or among the Company and its Wholly Owned Restricted
Subsidiaries.
SECTION 4.15. Repurchase Upon Change of Control.
(a) In the event of any Change of Control, the Company will be
required to commence a Change of Control Offer (as defined
below) to purchase all outstanding Securities on the date (the
"Change of Control Payment Date") which shall be no earlier
than 30 days nor later than 40 days from the date the Change of
Control Notice (as defined below) is mailed (or such later date
as is required by applicable law) at a purchase price equal to
<PAGE>
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101% of the aggregate principal amount thereof, plus accrued
and unpaid interest, if any, to the Change of Control Payment
Date (the "Change of Control Price").
(b) Within 30 days following the occurrence of a
Change of Control, the Company or, at the written request and
expense of the Company (which request shall be received by the
Trustee no more than 15 days following the occurrence of such
Change of Control, unless a shorter notice shall be satisfac-
tory to the Trustee in its sole discretion), the Trustee shall
send, by first-class mail, postage prepaid, to each Holder a
notice of the occurrence of such Change of Control (the "Change
of Control Notice"), specifying a date by which a Holder must
notify the Company of such Holder's intention to exercise the
repurchase right and describing the procedure that such Holder
must follow to exercise such right; provided, however, that the
text of any such Change of Control Notice requested to be
delivered by the Trustee shall, at the sole discretion of the
Trustee and within five Business Days of the request by the
Trustee, be prepared or approved by the Company and the Trustee
shall have no responsibility whatsoever with regard to such
Notice being accurate or correct. The Company shall, within
the same 30 day period, deliver a copy of such notice to the
Trustee and cause a copy of such notice to be published in a
daily newspaper of national circulation.
Each Change of Control Notice shall state: (1) that
an offer to purchase the Securities is being made pursuant to
this Section 4.15 (the "Change of Control Offer") and that all
Securities tendered will be accepted for payment; (2) the
Change of Control Price and the Change of Control Payment Date
which shall be no earlier than 30 days nor later than 40 days
from the date the Change of Control Notice is mailed; (3) that
any Security not tendered will continue to accrue interest;
(4) that, unless the Company defaults in the payment of the
Change of Control Price, all Securities accepted for payment
pursuant to the Change of Control Offer shall cease to accrue
interest after the Change of Control Payment Date; (5) that
Holders electing to have any Securities purchased pursuant to a
Change of Control Offer will be required to surrender the Secu-
rities, with the form entitled "Option of Holder to Elect Pur-
chase" on the reverse of the Securities completed, to the Pay-
ing Agent at the address specified in the notice not later than
the close of business on the Business Day immediately prior to
the Change of Control Payment Date; (6) that Holders will be
entitled to withdraw their election if the Paying Agent
receives, not later than the close of business on the Business
<PAGE>
-43-
Day two Business Days immediately prior to the Change of Con-
trol Payment Date, a telegram, telex, facsimile transmission or
letter setting forth the name of the Holder, the principal
amount of Securities delivered for purchase, and a statement
that such Holder is withdrawing his election to have such Secu-
rities purchased; (7) that Holders whose Securities are being
purchased only in part will be issued new Securities equal in
principal amount to the unpurchased portion of the Securities
surrendered, which unpurchased portion must be equal to $1,000
in principal amount or an integral multiple thereof; and (8)
the circumstances and relevant facts surrounding such Change of
Control. No failure of the Company to give the foregoing
notice shall limit any Holder's right to exercise a repurchase
right. On the Change of Control Payment Date, the Company
will: (i) accept for payment Securities or portions thereof
tendered pursuant to the Change of Control Offer; (ii) deposit
with the Paying Agent in immediately available funds an amount
equal to the Change of Control Price in respect of all Securi-
ties, or portions thereof so tendered; and (iii) deliver or
cause to be delivered to the Trustee the Securities so accepted
together with an Officers' Certificate stating the principal
amount of the Securities or portions thereof tendered to the
Company. The Paying Agent shall promptly mail to the Holders
of Securities so accepted payment in an amount equal to the
purchase price for such Securities and return any Securities
which were tendered but for which a withdrawal of election was
received by the Paying Agent before the Change of Control Pay-
ment Date, and the Trustee shall promptly authenticate and mail
to each Holder new Securities equal in principal amount to any
unpurchased portion of the Securities surrendered, if any; pro-
vided, however, that each such new Security shall be in a prin-
cipal amount of $1,000 or an integral multiple thereof.
In connection with any Change of Control Offer under
this Section 4.15, the Company shall (i) comply with Rule 14e-1
under the Exchange Act, and (ii) otherwise comply with all Fed-
eral and State securities laws so as to permit the rights and
obligations under this Section 4.15 to be exercised in the time
and in the manner specified. To the extent the provisions of
any such rule conflict with the provisions of this Section
4.15, the Company shall be required to comply with the provi-
sions of such rule and shall be deemed not to have breached its
obligations relating to such Change of Control Offer by virtue
thereof.
SECTION 4.16. Limitation on Asset Sales. (a) The
Company will not, and will not permit any of its Restricted
<PAGE>
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Subsidiaries to, consummate an Asset Sale unless (i) the Com-
pany (or the Restricted Subsidiary, as the case may be)
receives consideration at the time of such Asset Sale at least
equal to the Fair Market Value of the assets sold or otherwise
disposed of and (ii) at least 75% of the consideration therefor
received by the Company or such Restricted Subsidiary is in the
form of cash or Cash Equivalents; provided, however, that any
notes or other obligations received by the Company or any such
Restricted Subsidiary from such transferee that are immediately
converted by the Company or such Restricted Subsidiary into
cash or Cash Equivalents (to the extent of the cash or Cash
Equivalents received), shall be deemed to be cash or Cash
Equivalents for purposes of this provision; and provided, fur-
ther, that the restriction in (ii) above shall not (x) apply to
any Asset Sale where the Fair Market Value of the net proceeds
received by the Company or its Restricted Subsidiaries does not
exceed $20 million, except to the extent such Asset Sale is one
of a series of related Asset Sales where the Fair Market Value
of the aggregate net proceeds received therefor does exceed $20
million or (y) prohibit the Company or any Restricted Subsid-
iary from receiving as all or part of the consideration for any
Asset Sale, Capital Stock of any Person which is listed on a
United States national securities exchange; provided, however,
that (A) such Asset Sale is approved by the Board of Directors
of the Company, (B) the Company or the Restricted Subsidiary
receives a written opinion as to the fairness of such Asset
Sale from a financial point of view to the Company or such
Restricted Subsidiary from an investment banking firm of
national standing and (C) the Net Cash Proceeds resulting from
the sale, conversion, exchange or disposition of such Capital
Stock received by the Company or Restricted Subsidiary are
applied in accordance with the provisions of Section 4.16(b)
below. (b) Within 270 days after the date of any Asset Sale,
the Company shall apply the Net Cash Proceeds from such Asset
Sale to either (i) permanently reduce other Senior Debt (other
than the Securities), (ii) redeem, repurchase or retire the
Company's 10>% Senior Subordinated Notes due 1998 (at a price
no greater than the redemption price, plus accrued and unpaid
interest, if any, to the date of redemption, repurchase or
retirement specified in the indenture under which such securi-
ties were issued) or (iii) make any investment in properties
and assets in the same or similar lines of businesses as those
conducted by the Company and its Restricted Subsidiaries on the
date of this Indenture. Pending the final application of any
such Net Cash Proceeds, the Company may invest such Net Cash
Proceeds in any manner that is not prohibited by this Inden-
ture. Any Net Cash Proceeds from an Asset Sale that are not
<PAGE>
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applied or invested as provided above will be deemed to consti-
tute "Senior Excess Proceeds." (c) When the aggregate amount
of Senior Excess Proceeds exceeds $20 million, the Company
shall, within 30 days of the occurrence of such event, make an
offer to all Securityholders (a "Senior Asset Sale Offer") to
purchase the maximum principal amount of Securities that may be
purchased out of the Senior Excess Proceeds, at an offer price
in cash in an amount equal to 100% of the principal amount
thereof, plus accrued and unpaid interest, if any, to the date
fixed for the closing of such offer, in accordance with the
procedures set forth in this Indenture. Notice of such Senior
Asset Sale Offer shall be mailed or cause to be mailed, by
first-class mail, by the Company or, at the written request and
expense of the Company (which request shall be received by the
Trustee no more than 15 days following the occurrence of such
event, unless a shorter notice shall be satisfactory to the
Trustee at its sole discretion), the Trustee to all Holders at
their last registered addresses as of a date within 15 days
prior to the mailing of such notice, with a copy to the Trus-
tee; provided, however, that the text of any such notice
requested to be delivered by the Trustee shall, at the sole
discretion of the Trustee and within five days of the request
by the Trustee, be prepared or approved by the Company and the
Trustee shall have no responsibility whatsoever with regard to
such notice being accurate or correct. The notice shall con-
tain all instructions and materials necessary to enable such
Holders to tender Securities pursuant to the Senior Asset Sale
Offer and shall state the following terms: (1) that the Senior
Asset Sale Offer is being made pursuant to this Section 4.16
and that all Securities tendered will be accepted for payment;
provided, however, that if the aggregate principal amount of
Securities tendered in the Senior Asset Sale Offer exceeds the
aggregate amount of the Senior Excess Proceeds, the Trustee
shall select the Securities to be purchased on a pro rata basis
(with such adjustments as may be deemed appropriate by the
Trustee, so that only Securities in denominations of $1,000 or
multiple hereof shall be purchased). To the extent that the
aggregate amount of Securities tendered pursuant to the Senior
Asset Sale Offer is less than the Senior Excess Proceeds, the
Company may use such excess for general corporate purposes.
Upon the completion of the Senior Asset Sale Offer, the amount
of Senior Excess Proceeds shall be reset at zero; (2) the pur-
chase price (including the amount of accrued interest, if any)
and the purchase date (which shall be no earlier than 30 days
nor later than 40 days from the date such notice is mailed,
other than as may be required by law) (the "Proceeds Purchase
Date"); (3) that any Security not tendered will continue to
<PAGE>
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accrue interest; (4) that, unless there is a default in making
payment therefor, any Security accepted for payment pursuant to
the Senior Asset Sale Offer shall cease to accrue interest
after the Proceeds Purchase Date; (5) that Holders electing to
have a Security purchased pursuant to a Senior Asset Sale Offer
will be required to surrender the Security, with the form enti-
tled "Option of Holder to Elect Purchase" on the reverse of
the Security completed, to the Paying Agent at the address
specified in the notice prior to the close of business on the
Business Day immediately prior to the Proceeds Purchase Date;
(6) that Holders will be entitled to withdraw their election if
the Paying Agent receives, not later than the close of business
on the Business Day two Business Days immediately prior to the
Proceeds Purchase Date, a telegram, telex, facsimile transmis-
sion or letter setting forth the name of the Holder, the prin-
cipal amount of the Securities the Holder delivered for pur-
chase and a statement that such Holder is withdrawing his or
her election to have such Securities purchased; and (7) that
Holders whose Securities are purchased only in part will be
issued new Securities in a principal amount equal to the
unpurchased portion of the Securities surrendered. On or
before the Proceeds Purchase Date, the Company or such Subsid-
iary, as the case may be, shall (i) accept for payment Securi-
ties or portions thereof tendered pursuant to the Senior Asset
Sale Offer which are to be purchased in accordance with item
(c)(1) above, (ii) deposit in immediately available funds with
the Paying Agent money sufficient to pay the purchase price of
all Securities to be purchased and (iii) deliver to the Trustee
Securities so accepted together with an Officers' Certificate
stating the Securities or portions thereof being purchased by
the Company. The Paying Agent shall promptly mail to the
Securityholders so accepted payment in an amount equal to the
purchase price. (d) To the extent that any or all of the Net
Cash Proceeds of any Foreign Asset Sale are prohibited or
delayed by applicable local law from being repatriated to the
United States, the portion of such Net Cash Proceeds so
affected will not be required to be applied in accordance with
the foregoing provisions (other than to repay Indebtedness of
the entities engaging in such Foreign Asset Sale or, if permit-
ted by local law, Indebtedness of the Company or a Restricted
Subsidiary outside the United States, in each case as contem-
plated by the provisions above) at the time provided above but
may be retained by the entity engaging in such Foreign Asset
Sale so long, but only so long, as the applicable local law
will not permit repatriation to the United States (with the
Company agreeing to cause such entity to promptly take all
actions required by the applicable local law to permit such
<PAGE>
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repatriation) and once such repatriation of any of such
affected Net Cash Proceeds is permitted under the applicable
local law, such repatriation will be immediately effected and
such repatriated Net Cash Proceeds will be applied in the man-
ner set forth in this Section 4.16 as if the Asset Sale had
occurred on such date. (e) Notwithstanding the foregoing, the
Company will not, and will not permit any Restricted Subsidiary
to, directly or indirectly, make any Asset Sale of any of the
Capital Stock of any Restricted Subsidiary except (i) pursuant
to an Asset Sale of all of the Capital Stock of such Restricted
Subsidiary or (ii) unless (x) such Restricted Subsidiary is
designated as an Unrestricted Subsidiary immediately prior to,
and conditioned upon, the consummation of the Asset Sale of
such Capital Stock and (y) immediately after giving effect to
such Asset Sale and designation (on a pro forma basis as if
such Asset Sale and designation had been made at the beginning
of the applicable Four Quarter Period), the Company could incur
at least $1.00 of additional Indebtedness (other than Permitted
Indebtedness) pursuant to the provisions of Section 4.09
hereof.
SECTION 4.17. Maintenance of Properties and Insur-
ance. The Company shall cause all material properties owned by
or leased to it or any Subsidiary and used or useful in the
conduct of its business or the business of such Subsidiary to
be maintained and kept in normal condition, repair and working
order and supplied with all necessary equipment and shall cause
to be made all necessary repairs, renewals, replacements, bet-
terments and improvements thereof, all as in the judgment of
the Company may be necessary so that the business carried on in
connection therewith may be properly and advantageously con-
ducted at all times; provided, however, that nothing in this
Section 4.17 shall prevent the Company or any Subsidiary from
discontinuing the maintenance of any such properties, if such
discontinuance is desirable in the conduct of its business or
the business of such Subsidiary. The Company shall provide or
cause to be provided, for itself and any Subsidiaries, insur-
ance (including appropriate self-insurance) against loss or
damage of the kinds customarily insured against by corporations
similarly situated and owning like properties, including, but
not limited to, public liability insurance, with reputable
insurers in such amounts with such deductibles and by such
methods as shall be customary for corporations similarly situ-
ated in the industry.
SECTION 4.18. Payments for Consents. Neither the
Company nor any of its Subsidiaries shall, directly or
<PAGE>
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indirectly, pay or cause to be paid any consideration, whether
by way of interest, fee or otherwise, to any Holder of any
Securities for or as an inducement to any consent, waiver or
amendment of any of the terms or provisions of this Indenture
or the Securities unless such consideration is offered to be
paid or agreed to be paid to all Holders of the Securities
which so consent, waive or agree to amend in the time frame set
forth in the solicitation documents relating to such consent,
waiver or agreement.
SECTION 4.19. Limitation on Applicability of Certain
Covenants. During any period of time that (i) the ratings are
assigned to both the Securities and the Senior Subordinated
Notes by both Standard & Poor's Ratings Group and Moody's
Investors Services, Inc. (collectively, the "Rating Agencies")
and such ratings are equal to or higher than BBB- and Baa3,
respectively (the "Investment Grade Ratings") and (ii) no Event
of Default or Default has occurred and is continuing, the Com-
pany and its Restricted Subsidiaries will not be subject to
Sections 4.08, 4.09, 4.10, 4.13 and 4.16 of this Indenture
(collectively, the "Suspended Covenants"). In the event that
the Company is not subject to the Suspended Covenants for any
period of time as a result of the preceding sentence and, sub-
sequently, one or both Rating Agencies withdraws its rating or
downgrades the ratings assigned to the Securities or the Senior
Subordinated Notes below the required Investment Grade Ratings,
then the Company and its Restricted Subsidiaries will again be
subject to the Suspended Covenants and compliance with the Sus-
pended Covenants with respect to Restricted Payments made after
the time of such withdrawal or downgrade will be calculated in
accordance with the terms of Section 4.08 as if such section
had been in effect during the entire period of time from the
date of this Indenture; provided, however, that any action
taken by the Company or a Subsidiary during the time it was not
subject to, and which but for such suspension would have been
prohibited by, the Suspended Covenants shall not constitute an
Event of Default by virtue of the Company again becoming sub-
ject to the Suspended Covenants.
SECTION 4.20. Further Assurances. From time to time
the Company shall, at its own expense and upon request of the
Trustee, execute and deliver or cause to be executed and deliv-
ered such further instruments and do such further acts as may
reasonably be necessary or desirable to carry out the purposes
of this Indenture or to secure the rights and remedies hereun-
der of the Holders.
<PAGE>
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ARTICLE 5
SUCCESSOR CORPORATION
SECTION 5.01. Limitation on Merger, Consolidation
and Sale of Substantially All Assets. The Company may not con-
solidate or merge with or into, or sell, assign, transfer,
lease, convey or otherwise dispose of all or substantially all
of its properties or assets in one or more related transactions
to, another Person or adopt a plan of liquidation unless:
(i) the Company is the surviving corporation or the entity or
the person (the "Surviving Corporation") formed by or surviv-
ing any such consolidation or merger (if other than the Com-
pany) or to which such sale, assignment, transfer, lease, con-
veyance or other disposition shall have been made, is a corpo-
ration organized or existing under the laws of the United
States, any state thereof or the District of Columbia; (ii) the
Surviving Corporation expressly assumes (pursuant to a supple-
mental indenture in a form reasonably satisfactory to the Trus-
tee) all the Obligations of the Company under the Securities
and this Indenture; (iii) immediately after giving effect to
such transaction, no Default or Event of Default shall have
occurred and be continuing; (iv) the Surviving Corporation (x)
will have Consolidated Net Worth immediately after giving
effect to the transaction, on a pro forma basis (including any
Indebtedness incurred or anticipated to be incurred in connec-
tion with the transaction), equal to or greater than the Con-
solidated Net Worth of the Company immediately preceding the
transaction and (y) will, at the time of such transaction and
after giving pro forma effect thereto as if such transaction
had occurred as of the beginning of the applicable Four-Quarter
Period, be permitted to incur at least $1.00 of additional
Indebtedness (other than Permitted Indebtedness) pursuant to
Section 4.09 hereof; and (v) immediately after giving effect to
such transaction on a pro forma basis, the Consolidated Inter-
est Coverage Ratio of the Surviving Corporation is at least 2.0
to 1.0; provided, however, that, if the Consolidated Interest
Coverage Ratio of the Company immediately prior to such trans-
action is within the range set forth in Column (A) below, then
the pro forma Consolidated Interest Coverage Ratio of the Sur-
viving Corporation shall be at least equal to the lesser of (1)
the ratio determined by multiplying the percentage set forth in
column (B) below by the Consolidated Interest Coverage Ratio of
the Company immediately prior to such transaction and (2) the
ratio set forth in column (C) below:
<PAGE>
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(A) (B) (C)
2.22 to 1.0 to 2.99 to 1.0 90% 2.4 to 1.0
3.00 to 1.0 to 3.99 to 1.0 80% 2.8 to 1.0
4.00 to 1.0 or more 70% 2.9 to 1.0
provided, further, that if, immediately after giving effect to
such transaction on a pro forma basis, the Consolidated Inter-
est Coverage Ratio of the Surviving Corporation is 3.0 to 1.0
or more, the calculation in the preceding proviso shall be
inapplicable and such transaction shall be deemed to have com-
plied with the requirements of subparagraph (v). In connection
with any consolidation, merger or transfer contemplated hereby,
the Company shall deliver, or cause to be delivered, to the
Trustee, in form and substance reasonably satisfactory to the
Trustee, an Officers' Certificate and an Opinion of Counsel,
each stating that such consolidation, merger or transfer and
the supplemental indenture in respect thereto comply with this
Section 5.01 and that all conditions precedent herein provided
for relating to such transactions have been complied with.
SECTION 5.02. Successor Corporation Substituted.
Upon any consolidation or merger or any transfer of all or sub-
stantially all of the assets of the Company in accordance with
Section 5.01 hereof, the successor corporation formed by such
consolidation or into which the Company is merged or to which
such transfer is made, shall succeed to, and be substituted
for, and may exercise every right and power of the Company
under this Indenture with the same effect as if such successor
corporation had been named herein as the Company; and there-
after, the Company shall be discharged and released from all
obligations and covenants under this Indenture and the
Securities.
ARTICLE 6
DEFAULTS AND REMEDIES
SECTION 6.01. Events of Default. An "Event of
Default" occurs if any of the following shall have occurred and
be continuing (1) The Company defaults in the payment of (a)
interest on any Security when the same becomes due and payable
<PAGE>
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and the default continues for a period of 30 days, or (b) the
principal of or premium, if any, on any Security when the same
becomes due and payable at maturity or by redemption or other-
wise; (2) The Company fails to comply with the terms of
Article 5 hereof; (3) The Company fails to comply with any of
its covenants (but in the case of Suspended Covenants, only
during the time the Company is subject to such covenants) or
agreements in the Securities or this Indenture (other than
those referred to in clauses (1) and (2) above) and such fail-
ure continues for 30 days after receipt by the Company of a
Notice of Default as described in the penultimate paragraph of
this Section 6.01; (4) A default occurs under any mortgage,
indenture, guaranty or instrument under which there may be
issued or by which there may be secured or evidenced any
Indebtedness of the Company or any of its Restricted Subsidiar-
ies whether such Indebtedness existed as of the date of this
Indenture or was created thereafter, if (x) either (a) as a
result of such default, the maturity of such Indebtedness has
been accelerated prior to its expressed maturity or (b) such
default results from the failure to pay any such Indebtedness
at its stated maturity (after any applicable grace periods) and
(y) the principal amount of such Indebtedness aggregates
$25,000,000 or more; (5) Final judgments for the payments of
money which in the aggregate exceed $25,000,000 shall be
entered against the Company or any Restricted Subsidiary by a
court of competent jurisdiction and either (a) enforcement pro-
ceedings shall have been commenced by any creditor upon such
judgments, or (b) such judgments shall remain undischarged for
45 consecutive days after such judgments, during which a stay
of enforcement of such judgments shall not be in effect; (6)
The Company or any Restricted Subsidiary pursuant to or within
the meaning of any Bankruptcy Law (a) commences a voluntary
case or proceeding; (b) consents to the entry of an order for
relief against it in an involuntary case or proceeding; (c)
consents to the appointment of a custodian of it or for all or
substantially all of its property; (d) makes a general assign-
ment for the benefit of its creditors; or (e) admits in writing
its inability to pay its debts generally as they become due; or
(7) A court of competent jurisdiction enters an order or
decree under any Bankruptcy Law that (a) is for relief against
the Company or any Restricted Subsidiary in an involuntary case
or proceeding; (b) appoints a custodian of the Company or any
Restricted Subsidiary for all or substantially all of their
respective properties; or (c) orders the liquidation of the
Company or any Restricted Subsidiary and in each case the order
or decree remains unstayed and in effect for 60 days. A
Default under clause (3) above is not an Event of Default until
<PAGE>
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the Trustee notifies the Company, or the Holders of at least
25% in aggregate principal amount of the Securities at the time
outstanding notify the Company and the Trustee, of the Default
and the Company does not cure such Default within the time
specified in such clause after receipt of such notice. Any
such notice must specify the Default, demand that it be reme-
died and state that such notice is a "Notice of Default." The
Company is required to deliver to the Trustee, pursuant to Sec-
tion 4.04(a), a statement regarding compliance with this Inden-
ture, and the Company is required, upon becoming aware of any
Default or Event of Default, to deliver to the Trustee a state-
ment specifying such Default an Event of Default.
SECTION 6.02. Acceleration. If any Event of Default
(other than an Event of Default specified in clauses (6) and
(7) of Section 6.01) occurs and is continuing, the Trustee by
notice to the Company, or the Holders of at least 25% in aggre-
gate principal amount of the Securities at the time outstanding
by notice to the Company and the Trustee, may declare the
unpaid principal of and accrued interest on the Securities to
be immediately due and payable. If any Event of Default under
clause (6) or (7) of Section 6.01 occurs, all unpaid principal
and accrued interest on the Securities shall ipso facto become
and be immediately due and payable without any declaration,
notice or other act on the part of the Trustee or any Holder.
The Holders of a majority in aggregate principal amount of the
Securities at the time outstanding by written notice to the
Trustee may rescind an acceleration and its consequences if the
rescission would not conflict with any judgment or decree and
if all existing Events of Default have been cured or waived
except non-payment of principal or interest that has become due
solely because of the acceleration.
SECTION 6.03. Other Remedies. If an Event of
Default occurs and is continuing, the Trustee may (a) pursue
any available remedy by proceeding at law or in equity to col-
lect the payment of principal of, premium, if any, or interest
on the Securities or to enforce the performance of any provi-
sion of the Securities or this Indenture or (b) exercise any
right or power in respect of any Subordinated Debt, including
the right to send any default or other notice to the Company or
the holders, trustee, agent or other representative of the
holders of such Subordinated Debt (including the payment block-
age notice referred to in Section 10.03(b) of the Senior Subor-
dinated Note Indenture. The Trustee may maintain a proceeding
even if the Trustee does not possess any of the Securities or
does not produce any of the Securities in the proceeding. A
<PAGE>
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delay or omission by the Trustee or any Securityholder in exer-
cising any right or remedy accruing upon an Event of Default
shall not impair the right or remedy or constitute a waiver of,
or acquiescence in, the Event of Default. No remedy is exclu-
sive of any other remedy. All available remedies are cumula-
tive to the extent permitted by law.
SECTION 6.04. Waiver of Past Defaults. The Holders
of a majority in aggregate principal amount of the Securities
at the time outstanding, by notice to the Trustee (and without
notice to any other Securityholder), may waive an existing
Default or Event of Default and its consequences except (i) an
Event of Default described in Section 6.01(1) hereof, or (ii) a
Default in respect of a provision that under Section 9.02
hereof cannot be amended without the consent of each
Securityholder affected. When a Default or an Event of Default
is waived, it shall be deemed cured and shall cease to exist,
but no such waiver shall extend to any subsequent or other
Default or impair any consequent right.
SECTION 6.05. Control by Majority. The Holders of a
majority in aggregate principal amount of the Securities at the
time outstanding may direct the time, method and place of con-
ducting any proceeding for any remedy available to the Trustee
or of exercising any trust or power conferred on the Trustee.
However, the Trustee may refuse to follow any direction that
conflicts with law or this Indenture or that the Trustee deter-
mines in good faith is unduly prejudicial to the rights of
other Securityholders or would involve the Trustee in personal
liability.
SECTION 6.06. Limitation on Suits. Except as pro-
vided in Section 6.07 hereof, a Securityholder may not pursue
any remedy with respect to this Indenture or the Securities
unless: (1) the Holder gives to the Trustee written notice of
a continuing Event of Default; (2) the Holders of at least 25%
in aggregate principal amount of the Securities at the time
outstanding make a written request to the Trustee to pursue the
remedy; (3) such Holder or Holders offer to the Trustee indem-
nity reasonably satisfactory to the Trustee against any loss,
liability or expense; (4) the Trustee does not comply with the
request within 60 days after receipt of the notice, the request
and the offer of indemnity; and (5) the Holders of a majority
in aggregate principal amount of the Securities at the time
outstanding do not give the Trustee a direction inconsistent
with the request during such 60-day period. A Securityholder
may not use this Indenture to prejudice the rights of any other
<PAGE>
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Securityholder or to obtain a preference or priority over any
other Securityholder.
SECTION 6.07. Rights of Holders to Receive Payment.
Notwithstanding any other provision of this Indenture, the
right of any Holder to receive payment of the principal, pre-
mium, if any, or interest, in respect of the Securities held by
such Holder, on or after the respective due dates expressed in
the Securities, or to bring suit for the enforcement of any
such payment on or after such respective dates, shall not be
impaired or adversely affected without the consent of each such
Holder.
SECTION 6.08. Collection Suit by Trustee. If an
Event of Default described in Section 6.01(1) hereof occurs and
is continuing, the Trustee may recover judgment in its own name
and as trustee of an express trust against the Company for the
whole amount owing with respect to the Securities and, to the
extent lawful, expenses of collection, including reasonable
compensation, expenses, disbursements and advances of the Trus-
tee, its agents and counsel.
SECTION 6.09. Trustee May File Proofs of Claim. In
case of the pendency of any receivership, insolvency, liquida-
tion, bankruptcy, reorganization, arrangement, adjustment, com-
position or other judicial proceeding relative to the Company
or its properties, the Trustee shall be entitled and empowered,
by intervention in such proceeding or otherwise:
(1) to file and prove a claim for the whole amount
of the principal, premium, if any, and interest on the Securi-
ties and to file such other papers or documents as may be nec-
essary or advisable in order to have the claims of the Trustee
(including any claim for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and coun-
sel) and of the Holders allowed in such judicial proceeding;
and
(2) to collect and receive any moneys or other prop-
erty payable or deliverable on any such claims and to distrib-
ute the same; and any Custodian in any such judicial proceeding
is hereby authorized by each Holder to make such payments to
the Trustee and, in the event that the Trustee shall consent to
the making of such payments directly to the Holders, to pay the
Trustee any amount due it for the reasonable compensation,
expenses, disbursements and advances of the Trustee, its agents
and counsel, and any other amounts due the Trustee under
<PAGE>
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Section 7.07 hereof. Nothing herein contained shall be deemed
to authorize the Trustee to authorize or consent to or accept
or adopt on behalf of any Holder any plan of reorganization,
arrangement, adjustment or composition affecting the Securities
or the rights of any Holder thereof, or to authorize the Trus-
tee to vote in respect of the claim of any Holder in any such
proceeding.
SECTION 6.10. Priorities. If the Trustee collects
any money pursuant to this Article 6, it shall pay out the
money in the following order:
FIRST: to the Trustee for amounts due under Section
7.07 hereof;
SECOND: to the Securityholders for amounts due and
unpaid on the Securities for principal and interest, ratably,
without preference or priority of any kind, according to such
amounts due and payable on the Securities for principal and
interest, respectively; and
THIRD: the balance, if any, to the Company. The
Trustee may fix a record date and payment date for any payment
to Securityholders pursuant to this Section 6.10 and give what-
ever notice to the Securityholders as the Trustee deems appro-
priate.
SECTION 6.11. Undertaking for Costs. In any suit
for the enforcement of any right or remedy under this Indenture
or in any suit against the Trustee for any action taken or
omitted by it as Trustee, a court in its discretion may require
the filing by any party litigant (other than the Trustee) in
the suit of an undertaking to pay the costs of the suit, and
the court in its discretion may assess reasonable costs,
including reasonable attorneys' fees and expenses, against any
party litigant in the suit, having due regard to the merits and
good faith of the claims or defenses made by the party liti-
gant. This Section 6.11 does not apply to a suit by the Trus-
tee, a suit by a Holder pursuant to Section 6.07 hereof or a
suit by Holders of more than 10% in aggregate principal amount
of the Securities at the time outstanding.
<PAGE>
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ARTICLE 7
TRUSTEE
SECTION 7.01. Duties of Trustee. (a) If an Event
of Default has occurred and is continuing, the Trustee shall
exercise the rights and powers vested in it by this Indenture
and use the same degree of care and skill in its exercise as a
prudent man would exercise or use under the circumstances in
the conduct of his own affairs.
(b) Except during the continuance of an Event of
Default:
(1) the Trustee need perform only those duties that
are specifically set forth in this Indenture and no oth-
ers; and
(2) in the absence of bad faith on its part, the
Trustee may conclusively rely, as to the truth of the
statements and the correctness of the opinions expressed
therein, upon certificates or opinions furnished to the
Trustee and conforming to the requirements of this Inden-
ture. However, in the case of any such certificates or
opinions which by any provision hereof are specifically
required to be furnished to the Trustee, the Trustee shall
examine the certificates and opinions to determine whether
or not they conform to the requirements of this Indenture.
The Trustee shall not be liable for any interest on any
money received by it.
(c) The Trustee may not be relieved from liability
for its own negligent action, its own negligent failure to act
or its own willful misconduct, except that:
(1) this paragraph (c) does not limit the effect of
paragraph (d) of this Section 7.01 or the effect of Sec-
tion 7.02;
(2) the Trustee shall not be liable for any error of
judgment made in good faith by an Officer of the Trustee
unless it is proved that the Trustee was negligent ascer-
taining the pertinent facts; and
(3) the Trustee shall not be liable with respect to
any action it takes or omits to take in good faith in
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accordance with a direction received by it pursuant to
Section 6.05 hereof.
(d) Every provision of this Indenture that in any
way relates to the Trustee is subject to paragraphs (a), (b),
(c) and (e) of this Section 7.01.
(e) The Trustee's performance of any of its duties
hereunder or the exercise of any of its rights or powers shall
not require the Trustee to expend or risk its own funds or
otherwise incur any financial liability unless it shall receive
security or indemnity satisfactory to it against any loss, lia-
bility or expense.
(f) Money held by the Trustee in trust hereunder
need not be segregated from other funds except to the extent
required by law. The Trustee shall be under no liability for
interest on any money held by it hereunder.
SECTION 7.02. Rights of Trustee. (a) The Trustee
may rely and shall be protected in acting or refraining from
acting upon any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent, order,
bond, debenture, note, other evidence of Indebtedness, approval
or other paper or document believed by it to be genuine and to
have been signed or presented by the proper party or parties.
(b) Before the Trustee acts or refrains from acting,
it may require an Officers' Certificate, an Opinion of Counsel
or reports of accountants and other experts covering such mat-
ters as the Trustee may reasonably require. The Trustee shall
not be liable for any action it takes or omits to take in good
faith in reliance on such Officers' Certificate, Opinion of
Counsel or reports.
(c) The Trustee may execute any of the trusts or
powers hereunder or perform any duties hereunder either
directly or by or through agents or attorneys and the Trustee
shall not be responsible for any misconduct or negligence on
the part of any agent or attorney appointed with due care by it
hereunder.
(d) The Trustee shall not be liable for any action
it takes or omits to take in good faith which it believes to be
authorized or within its rights or powers.
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(e) The Trustee shall not be bound to make any
investigation into the facts or matters stated in any resolu-
tion, certificate, statement, instrument, opinion, report,
notice, request, direction, consent, order, bond, debenture,
note, other evidence of Indebtedness or other paper or docu-
ment, but the Trustee, in its discretion, may make such further
inquiry or investigation into such facts or matters as it may
see fit, and, if the Trustee shall determine to make such fur-
ther inquiry or investigation, it shall be entitled to examine
the books, records and premises of the Company personally or by
agent or attorney.
(f) The Trustee may consult with counsel, accoun-
tants and other experts of its selection and the advice of such
persons or any Opinion of Counsel or reports of accountants or
other experts shall be full and complete authorization and pro-
tection in respect of any action taken, suffered or omitted by
it hereunder in good faith and in reliance thereon.
(g) The Trustee shall be under no obligation to
exercise any of the rights or powers vested in it by this
Indenture at the request or direction of any of the Holders
pursuant to this Indenture, unless such Holders shall have
offered to the Trustee reasonable security and indemnity
against the costs, expenses and liabilities which might be
incurred by it in compliance with such request or direction.
(h) The Trustee shall be aware of an Event of
Default only if it has received written notice thereof.
SECTION 7.03. Individual Rights of Trustee. The
Trustee in its individual or any other capacity may become the
owner or pledgee of Securities and may otherwise deal with the
Company or its Affiliates with the same rights it would have if
it were not Trustee. Any Paying Agent, Registrar or
co-registrar may do the same with like rights. However, the
Trustee must comply with Sections 7.10 and 7.11 hereof.
SECTION 7.04. Trustee's Disclaimer. The Trustee
makes no representation as to the validity or adequacy of this
Indenture or the Securities, it shall not be accountable for
the Company's use or application of the Securities or of the
proceeds thereof and it shall not be responsible for any state-
ment in the registration statement for the Securities under the
Securities Act of 1933, as amended (the "Securities Act")
(other than statements contained in the Form T-1 filed with the
SEC under the TIA), or in this Indenture or the Securities
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(other than its certificate of authentication), or the determi-
nation as to which beneficial owners are entitled to receive
any notices hereunder.
SECTION 7.05. Notice of Defaults. If a Default
occurs and is continuing and if it is known to the Trustee, the
Trustee shall mail to each Securityholder, as its name and
address appears on the Register, notice of the Default within
90 days after it becomes known to the Trustee unless such
Default shall have been cured or waived. Except in the case of
a Default described in Section 6.01(1) hereof, the Trustee may
withhold such notice if and so long as a committee of Officers
of the Trustee in good faith determines that the withholding of
such notice is in the interests of Securityholders. The second
sentence of this Section 7.05 shall be in lieu of the proviso
to Section 315(b) of the TIA and said proviso is hereby
expressly excluded from this Indenture, as permitted by the
TIA.
SECTION 7.06. Reports by Trustee to Holders. Within
60 days after each May 15 beginning with May 15, 1994, the
Trustee shall mail to each Securityholder a brief report dated
as of such May 15 in accordance with and to the extent required
under Section 313 of the TIA. A copy of each report at the
time of its mailing to Securityholders shall be filed with the
Company, the SEC and each stock exchange on which the Securi-
ties are listed, if any. The Company agrees to notify the
Trustee promptly whenever the Securities become listed on any
stock exchange and of any delisting thereof.
SECTION 7.07. Compensation and Indemnity. The Com-
pany agrees:
(1) To pay to the Trustee from time to time reason-
able compensation for all services rendered by it hereun-
der (which compensation shall not be limited by any provi-
sion of law in regard to the compensation of a trustee of
an express trust);
(2) To reimburse the Trustee upon its request for
all reasonable expenses, disbursements and advances
incurred or made by the Trustee in accordance with any
provision of this Indenture (including the reasonable com-
pensation and the expenses, disbursements and advances of
its agents and counsel), except any such expense, dis-
bursement or advance as may be attributable to its negli-
gence or bad faith; and
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(3) To indemnify the Trustee for, and to hold it
harmless against, any and all loss, liability or expense,
incurred without negligence or bad faith on its part,
arising out of or in connection with the acceptance or
administration of this trust, including the reasonable
costs and expenses of defending itself against any claim
or liability in connection with the exercise or perfor-
mance of any of its powers or duties hereunder. The Trus-
tee shall have a claim and lien prior to the Securities as
to all property and funds held by it hereunder for any
amount owing it or any predecessor Trustee pursuant to
this Section 7.07, except with respect to funds held in
trust for the payment of principal of, premium, if any, or
interest on particular Securities. The Company's obliga-
tions pursuant to this Section 7.07 shall survive the sat-
isfaction and discharge of this Indenture. When the Trus-
tee incurs expenses after the occurrence of a Default
specified in Section 6.01 hereof, the expenses are
intended to constitute expenses of administration under
any Bankruptcy Law.
SECTION 7.08. Replacement of Trustee. The Trustee
may resign by so notifying the Company in writing at least 30
days prior to the date of the proposed resignation; provided,
however, no such resignation shall be effective until a succes-
sor Trustee has accepted its appointment pursuant to this Sec-
tion 7.08. The Trustee may be removed by an Act of the Holders
of a majority in aggregate principal amount of the Securities
at the time outstanding delivered to the Trustee and the Com-
pany. Such Holders may by such an Act delivered to the Trustee
appoint a successor Trustee subject to the consent of the Com-
pany. The Trustee shall resign if:
(1) the Trustee fails to comply with Section 7.10
hereof;
(2) the Trustee is adjudged bankrupt or insolvent;
(3) a receiver or public officer takes charge the
Trustee or its property; or
(4) the Trustee otherwise becomes incapable of
acting.
If the Trustee resigns or is removed or if a vacancy exists in
the office of Trustee for any reason, the Company shall
promptly appoint, by resolution of its Board of Directors, a
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successor Trustee. A successor Trustee shall deliver a written
acceptance of its appointment to the retiring Trustee and to
the Company. Thereupon the resignation or removal of the
retiring Trustee shall become effective, and the successor
Trustee without any further act, deed or conveyance, shall
become vested with and have all the rights, powers and duties
of the Trustee under this Indenture. The successor Trustee
shall mail a notice of its succession to Securityholders. Sub-
ject to payment of all amounts owing to the Trustee under Sec-
tion 7.07 hereof and subject further to its lien under Section
7.07, the retiring Trustee shall promptly transfer all property
held by it as Trustee to the successor Trustee. If a successor
Trustee does not take office within 30 days after the retiring
Trustee resigns or is removed, the retiring Trustee, the Com-
pany or the Holders of a majority in aggregate principal amount
of the Securities at the time outstanding may petition any
court of competent jurisdiction for the appointment of a suc-
cessor Trustee. If the Trustee fails to comply with Section
7.10 hereof, any Securityholder may petition any court of com-
petent jurisdiction for the removal of the Trustee and the
appointment of a successor Trustee.
SECTION 7.09. Successor Trustee by Merger. If the
Trustee consolidates with, merges or converts into, or trans-
fers all or substantially all its corporate trust business or
assets to, another corporation, the resulting, surviving or
transferee corporation without any further act shall be the
successor Trustee.
SECTION 7.10. Eligibility; Disqualification. The
Trustee shall at all times satisfy the requirements of TIA Sec-
tion 310(a)(1). The Trustee shall have a combined capital and
surplus of at least $10,000,000 as set forth in its most recent
published annual report of condition. The Trustee shall comply
with TIA Section 310(b). In determining whether the Trustee
has conflicting interests as defined in TIA Section 310(b)(1),
the provisions contained in the proviso to TIA Section
310(b)(1) shall be deemed incorporated herein.
SECTION 7.11. Preferential Collection of Claims
Against Company. The Trustee is subject to TIA Section 311(a),
excluding any creditor relationship in TIA Section 311(b). A
Trustee who has resigned or been removed shall be subject to
TIA Section 311(a) to the extent indicated therein.
<PAGE>
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ARTICLE 8
DISCHARGE OF INDENTURE
SECTION 8.01. Discharge of Liability on Securities;
Defeasance.
(a) When (i) the Company delivers to the Trustee all
outstanding Securities (other than Securities replaced pursuant
to Section 2.07 hereof or Securities which are purchased pursu-
ant to Section 3.08 and Section 4.15 or 4.16 hereof or Securi-
ties for whose payment money has theretofore been held in trust
and thereafter repaid to the Company, as provided in Section
8.02 hereof) for cancellation, or (ii) the Company irrevocably
deposits with the Trustee money and/or U.S. Government Obliga-
tions, maturing as to principal and interest in such amounts
and at such times as are sufficient, without consideration of
any reinvestment of such interest, to pay principal of, and
interest on, the outstanding Securities (other than Securities
replaced pursuant to Section 2.07 hereof) to maturity in accor-
dance with the terms of this Indenture and the Securities
issued hereunder, and if in either case the Company pays all
other sums payable hereunder by the Company, then this Inden-
ture shall, subject to Sections 2.06, 7.07, 8.01(c) and 8.06
hereof, cease to be of further effect. The Trustee shall join
in the execution of any documents prepared by the Company
acknowledging satisfaction and discharge of this Indenture on
written demand of the Company accompanied by an Officers' Cer-
tificate and Opinion of Counsel and at the cost and expense of
the Company.
(b) Subject to Sections 8.01(c), 8.02 and 8.06, the
Company may at any time terminate (i) all its obligations under
the Securities and this Indenture ("legal defeasance"), or (ii)
its obligations under Sections 4.08 through 4.20 ("covenant
defeasance"). The Company may exercise its legal defeasance
option notwithstanding its prior exercise of its covenant
defeasance option. If the Company exercises its legal defea-
sance option, payment of the Securities may not be accelerated
because of an Event of Default with respect thereto. Upon sat-
isfaction of the conditions set forth herein and upon request
of the Company, the Trustee shall acknowledge in writing the
discharge of those obligations that the Company terminates.
(c) Notwithstanding clauses (a) and (b) above, the
Company's obligations in Sections 2.03, 2.04, 2.05, 2.06, 2.07,
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4.20, 7.07, 7.08, 8.04, 8.05 and 8.06 shall survive until the
Securities have been paid in full. Thereafter, the Company's
obligations in Sections 7.07, 8.04 and 8.05 shall survive.
SECTION 8.02. Conditions to Defeasance. The Company
may exercise its legal defeasance option or its covenant defea-
sance option only if:
(1) the Company irrevocably deposits in trust (the
"defeasance trust") with the Trustee (or, at the
option of the Trustee, another trustee satisfying the
requirements of Section 7.10) money, U.S. Governmen-
tal Obligations, or any combination thereof, suffi-
cient to pay the principal of, premium, if any, and
interest on the Securities to maturity or redemption,
as the case may be;
(2) the Company delivers to the Trustee (and such other
trustee, if any) a certificate from a nationally rec-
ognized firm of independent accountants expressing
the opinion that the payment of principal and inter-
est when due and without reinvestment on the depos-
ited U.S. Government Obligations plus any deposited
money without reinvestment will provide cash at such
times and in such amounts as will be sufficient to
pay principal, premium, if any, and interest when due
on all the Securities to maturity or redemption, as
the case may be;
(3) the Company shall have delivered to the Trustee (and
such other trustee, if any) an Opinion of Counsel to
the effect that the trust funds will not be subject
to any applicable bankruptcy, insolvency, reorganiza-
tion or similar laws affecting creditors' rights gen-
erally;
(4) no Default or Event of Default shall have occurred
and be continuing on the date of such deposit or,
insofar as Events of Default from bankruptcy or
insolvency events are concerned, at any time in the
period ending on the 91st day after the date of
deposit;
(5) the Company delivers to the Trustee (and such other
trustee, if any) an Officers' Certificate and an
Opinion of Counsel to the effect that such legal
defeasance or covenant defeasance shall not result in
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a breach or violation of or constitute a default
under this Indenture, or any other material agreement
or instrument to which the Company is a party or by
which the Company is bound;
(6) the Company delivers to the Trustee (and such other
trustee, if any) an Opinion of Counsel to the effect
that the trust resulting from the deposit is not
required to be registered as an investment company
under the Investment Company Act of 1940, as amended;
(7) the Company delivers an Opinion of Counsel to the
Trustee (and such other trustee, if any) to the
effect that the Securityholder has a perfected secu-
rity interest under applicable law in the U.S.
Government Obligations so deposited;
(8) in the case of legal defeasance, the Company delivers
to the Trustee (and such other trustee, if any) an
Opinion of Counsel reasonably acceptable to such
Trustee confirming that (a) the Company has received
from, or there has been published by, the Internal
Revenue Service a ruling or (b) since the date of the
Indenture, there has been a change in the applicable
federal income tax law, in either case to the effect
that, and based thereon such Opinion of Counsel shall
confirm that, the Securityholder will not recognize
income, gain or loss for federal income tax purposes
as a result of such legal defeasance and will be sub-
ject to federal income tax on the same amounts, in
the same manner and at the same times as would have
been the case if such legal defeasance had not
occurred;
(9) in the case of covenant defeasance, the Company
delivers to the Trustee (and such other trustee, if
any) an Opinion of Counsel reasonably acceptable to
the Trustee confirming that the Securityholder will
not recognize income, gain or loss for federal income
tax purposes as a result of such covenant defeasance
and will be subject to federal income tax on the same
amounts, in the same manner and at the same times as
would have been the case if such covenant defeasance
had not occurred; and
(10) the Company delivers to the Trustee (and such other
trustee, if any) an Officers' Certificate and an
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Opinion of Counsel, each stating that all conditions
precedent provided for relating to either the legal
defeasance or the covenant defeasance, as the case
may be, have been complied with. Notwithstanding the
foregoing provisions of this Section, the conditions
set forth in the foregoing paragraphs (2), (3), (4),
(5), (6) and (7) need not be satisfied so long as, at
the time the Company makes the deposit described in
paragraph (1), (i) no default under Section 6.01(1),
6.01(2), 6.01(6) or 6.01(7) has occurred and is con-
tinuing on the date of such deposit and after giving
effect thereto and (ii) either (x) a notice of
redemption has been mailed pursuant to Section 3.05
providing for redemption of all the Securities 30
days after such mailing and the provisions of Article
3 with respect to such redemption shall have been
complied with or (y) the Stated Maturity of all of
the Securities will occur within 30 days. If the
conditions of the preceding sentence are satisfied,
the Company shall be deemed to have exercised its
covenant defeasance option. Before or after a
deposit, the Company may make arrangements satisfac-
tory to the Trustee for the redemption of Securities
at a future date in accordance with Article III.
SECTION 8.03. Application of Trust Money. The Trus-
tee (or such other trustee, if any) shall hold in trust money
or U.S. Government Obligations deposited with it pursuant to
this Article VIII. It shall apply the deposited money and the
money from U.S. Government Obligations through the Paying Agent
and in accordance with this Indenture to the payment of princi-
pal of and interest, if any, on the Securities.
SECTION 8.04. Repayment to the Company. The Trustee
(or such other trustee, if any) and the Paying Agent shall
promptly pay to the Company upon written request any excess
money or U.S. Government Obligations held by them at any time.
The Trustee (or such other trustee, if any) and the Paying
Agent shall return to the Company upon written request any
money held by them for the payment of any amount with respect
to the Securities that remains unclaimed for two years; pro-
vided, however, that the Trustee (or such other trustee, if
any) or such Paying Agent, before being required to make such
return, may, in the name and at the expense of the Company,
cause to be published once in a daily newspaper of national
circulation or mail to each such Holder notice that such money
or securities remains unclaimed and that, after a date
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specified therein, which shall not be less than 30 days from
the date of such mailing, any unclaimed money or securities
then remaining will be returned to the Company. After return
to the Company, Holders entitled to the money must look to the
Company for payment as general creditors unless an applicable
abandoned property law designates another Person, and all lia-
bility of the Trustee, such other trustee (if any) and such
Paying Agent with respect to such money shall cease.
SECTION 8.05. Indemnity for Government Obligations.
The Company shall pay and shall indemnify the Trustee (and such
other Trustee, if any) against any tax, fee or other charges
imposed on or assessed against U.S. Government Obligations or
the principal and interest received on such U.S. Government
Obligations.
SECTION 8.06. Reinstatement. If the Trustee, such
other trustee (if any) or Paying Agent is unable to apply any
money or U.S. Government Obligations in accordance with this
Article VIII by reason of any legal proceeding or by reason of
any order or judgment of any court or governmental authority
enjoining, restraining or otherwise prohibiting such applica-
tion, the Company's obligations under this Indenture and the
Securities shall be revived and reinstated as though no deposit
had occurred pursuant to this Article VIII until such time as
the Trustee, such other trustee (if any) or Paying Agent is
permitted to apply all such money or U.S. Government Obliga-
tions in accordance with this Article VIII; provided that, if
the Company has made any payment of interest, if any, on or
principal of any Securities because of the reinstatement of its
obligations, the Company shall be subrogated to the rights of
the Holders of such Securities to receive such payment from the
money or U.S. Government Obligations held by the Trustee, such
other trustee (if any) or Paying Agent.
ARTICLE 9
AMENDMENTS
SECTION 9.01. Without Consent of Holders. The Com-
pany and the Trustee, without notice to or the consent of the
holders of the Securities issued hereunder, may amend or sup-
plement this Indenture and/or the Securities as follows:
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(1) to cure any ambiguity, defect or inconsistency;
(2) to comply with Article 5 hereof; or
(3) to provide for uncertificated Securities in
addition to or in place of certificated Securities so long as
such uncertificated Securities are in registered form for pur-
poses of the Internal Revenue Code of 1986, as amended; or
(4) to make any other change that would provide any
additional rights or benefits of any Securityholder or that
does not adversely affect the rights under this Indenture of
any Securityholder; or
(5) to comply with any requirement of the SEC in
connection with the qualification of this Indenture under the
TIA.
SECTION 9.02. With Consent of Holders. With the
written consent of the Holders of at least a majority in aggre-
gate principal amount of the Securities at the time outstand-
ing, the Company and the Trustee may, except as provided below,
amend this Indenture and/or the Securities or may waive any
existing default or compliance by the Company with any provi-
sions of this Indenture or the Securities. However, without
the consent of each Securityholder affected, a waiver or an
amendment to this Indenture or the Securities may not:
(1) reduce the aggregate principal amount of Securi-
ties whose Holders must consent to an amendment or waiver; or
(2) reduce the principal of or change the fixed
maturity o any Securities or alter the redemption provisions
with respect thereto; or
(3) reduce the rate of or change the time for pay-
ments of interest on the Securities; or
(4) make any change in the provisions of Section
4.15 or 4.16; or
(5) waive a default in the payment of the principal,
premium, if any, or interest on, any Securities;
(6) make any Securities payable in money other than
that stated in the Securities;
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(7) make any change in the provisions of this Inden-
ture relating to waivers of past Defaults or the rights of
Holders of Securities to receive payments of principal of, pre-
mium, if any, or interest on the Securities; or
(8) make any change in the foregoing provisions of
this Section 9.02.
It shall not be necessary for the consent of the Holders under
this Section 9.02 to approve the particular form of any pro-
posed amendment, but it shall be sufficient if such consent
approves the substance thereof. In the event that certain
Holders are willing to defer or waive certain obligations of
the Company hereunder with respect to Securities held by them,
such deferral or waiver shall not be deemed to affect any other
Holder who receives the subject payment or performance in a
timely manner. After an amendment or waiver under this
Section 9.02 becomes effective, the Company shall mail to each
Holder a notice briefly describing the amendment or waiver.
Any failure of the Company to mail such notice, or any defect
therein, shall not, however, in any way impair or affect the
validity of any such amendment or waiver.
SECTION 9.03. Compliance with Trust Indenture Act.
Every supplemental indenture executed pursuant to this
Article 9 shall comply with the TIA.
SECTION 9.04. Revocation and Effect of Consents,
Waivers and Actions. Until an amendment, waiver or other
action by Holders becomes effective, a consent to it or any
other action by a Holder of a Security hereunder is a continu-
ing consent by the Holder and every subsequent Holder of that
Security or portion of the Security that evidences the same
obligation as the consenting Holder's Security, even if nota-
tion of the consent, waiver or action is not made on the Secu-
rity. However, any such Holder or subsequent Holder may revoke
the consent, waiver or action as to such Holder's Security or
portion of the Security if the Trustee receives the notice of
revocation before the consent of the requisite aggregate prin-
cipal amount of the Securities then outstanding has been
obtained and not revoked. After an amendment, waiver or action
becomes effective, it shall bind every Securityholder and every
subsequent Holder thereof, except as provided in Section 9.02
hereof. The Company or the Trustee may, pursuant to Section
1.05(e), but shall not be obligated to, fix a record date for
the purpose of determining the Holders entitled to consent to
any amendment or waiver. If a record date is fixed, then,
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notwithstanding the first two sentences of the immediately
preceding paragraph, those Persons who were Holders at such
record date (or their duly designated proxies), and only those
Persons, shall be entitled to consent to such amendment, sup-
plement or waiver or to revoke any consent previously given,
whether or not such Persons continue to be Holders after such
record date. No such consent shall be valid or effective for
more than 90 days after such record date.
SECTION 9.05. Notation on or Exchange of Securities.
Securities authenticated and made available for delivery after
the execution of any supplemental indenture pursuant to this
Article 9 may, and shall, if required by the Trustee, bear a
notation in form approved by the Trustee as to any matter pro-
vided for in such supplemental indenture. If the Company or
the Trustee shall so determine, new Securities so modified as
to conform, in the opinion of counsel satisfactory to the Trus-
tee and the Board of Directors of the Company, to any such sup-
plemental indenture may be prepared and executed by the Company
and authenticated and made available for delivery by the Trus-
tee in exchange for outstanding Securities.
SECTION 9.06. Trustee to Sign Supplemental Inden-
tures. The Trustee shall sign any supplemental indenture
authorized pursuant to this Article 9 if the supplemental
indenture does not adversely affect the rights, duties, liabil-
ities or immunities of the Trustee. If it does, the Trustee
may, but need not, sign it. In signing such amendment the
Trustee shall be entitled to receive, and shall be fully pro-
tected in relying upon, an Officers' Certificate and Opinion of
Counsel stating that such supplemental indenture is authorized
or permitted by this Indenture.
SECTION 9.07. Effect of Supplemental Indentures.
Upon the execution of any supplemental indenture under this
Article 9, this Indenture shall be modified in accordance
therewith, and such supplemental indenture shall form a part of
this Indenture for all purposes; and every Holder of Securities
theretofore or thereafter authenticated and made available for
delivery hereunder shall be bound thereby.
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ARTICLE 10
MISCELLANEOUS
SECTION 10.01. Trust Indenture Act Controls. If any
provision of this Indenture limits, qualifies or conflicts with
the duties imposed by operation of subsection (c) of Section
318 of the TIA, the imposed duties shall control. The provi-
sions of Sections 310 to 317, inclusive, of the TIA that impose
duties on any Person (including provisions automatically deemed
included in an indenture unless the indenture provides that
such provisions are excluded) are a part of and govern this
Indenture, except as, and to the extent, expressly excluded
from this Indenture, as permitted by the TIA.
SECTION 10.02. Notices. Any notice or communication
shall be in writing and delivered in person or mailed by
first-class mail, postage prepaid, addressed as follows:
if to the Company:
Sequa Corporation
200 Park Avenue
New York, New York 10166
Attention: Treasurer
if to the Trustee:
IBJ Schroder Bank & Trust Company
One State Street
New York, NY 10004
Attention: Corporate Trust Administration
The Company or the Trustee, by notice to the others,
may designate additional or different addresses for subsequent
notices or communications.
Any notice or communication given to a Securityholder
shall be mailed to the Securityholder at the Securityholder's
address as it appears on the registration books of the Regis-
trar and shall be sufficiently given if so mailed within the
time prescribed.
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Failure to mail a notice or communication to a
Securityholder or any defect in it shall not affect its suffi-
ciency with respect to other Securityholders. If a notice or
communication is mailed in the manner provided above, it is
duly given, whether or not received by the addressee.
If the Company mails a notice or communication to the
Securityholders, it shall mail a copy to the Trustee and each
Registrar, Paying Agent or co-registrar.
SECTION 10.03. Communication by Holders with Other
Holders. Securityholders may communicate pursuant to TIA Sec-
tion 312(b) with other Securityholders with respect to their
rights under this Indenture or the Securities. The Company,
the Trustee, the Registrar, the Paying Agent and anyone else
shall have the protection of TIA Section 312(c).
SECTION 10.04. Certificate and Opinion as to Condi-
tions Precedent. Upon any request or application by the Com-
pany to the Trustee to take any action under this Indenture,
the Company shall furnish to the Trustee:
(1) an Officers' Certificate stating that, in the
opinion of the signers, all conditions precedent, if any, pro-
vided for in this Indenture relating to the proposed action
have been complied with; and
(2) an Opinion of Counsel stating that, in the opin-
ion of such counsel, all such conditions precedent have been
complied with.
SECTION 10.05. Statements Required in Certificate or
Opinion. Each Officers' Certificate and Opinion of Counsel
with respect to compliance with a covenant or condition pro-
vided for in this Indenture shall include:
(1) a statement that each Person making such Offic-
ers' Certificate or Opinion of Counsel has read such covenant
or condition;
(2) a brief statement as to the nature and scope of
the examination or investigation upon which the statements or
opinions contained in such Officers' Certificate or Opinion of
Counsel are based;
(3) a statement that, in the opinion of each such
Person, he has made such examination or investigation as is
<PAGE>
-72-
necessary to enable such Person to express an informed opinion
as to whether or not such covenant or condition has been com-
plied with; and
(4) a statement that, in the opinion of such Person,
such covenant or condition has been complied with.
SECTION 10.06. Separability Clause. In case any
provision in this Indenture or in the Securities shall be
invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any way
be affected or impaired thereby.
SECTION 10.07. Rules by Trustee, Paying Agent and
Registrar. The Trustee may make reasonable rules for action by
or a meeting of Securityholders. The Registrar and Paying
Agent may make reasonable rules for their functions.
SECTION 10.08. Legal Holidays. A "Legal Holiday" is
any day other than a Business Day. If any specified date
(including a date for giving notice) is a Legal Holiday, the
action shall be taken on the next succeeding day that is not a
Legal Holiday, and, if the action to be taken on such date is a
payment in respect of the Securities, no principal, premium, if
any, or interest installment shall accrue for the intervening
period.
SECTION 10.09. GOVERNING LAW AND CHOICE OF FORUM.
THIS INDENTURE AND THE SECURITIES SHALL BE GOVERNED BY AND CON-
STRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, AS
APPLIED TO CONTRACTS MADE AND PERFORMED WITHIN THE STATE OF NEW
YORK, WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAWS. IF
ANY ACTION OR PROCEEDING SHALL BE BROUGHT BY THE TRUSTEE OR BY
A HOLDER OF ANY OF THE SECURITIES IN ORDER TO ENFORCE ANY RIGHT
OR REMEDY UNDER THIS INDENTURE OR UNDER THE SECURITIES, THE
COMPANY HEREBY CONSENTS AND SUBMITS TO THE JURISDICTION OF THE
COURTS OF THE STATE OF NEW YORK AND OF ANY FEDERAL COURT SIT-
TING IN THE CITY OF NEW YORK, STATE OF NEW YORK. ANY ACTION OR
PROCEEDING BROUGHT BY THE COMPANY TO ENFORCE ANY RIGHT, ASSERT
ANY CLAIM OR OBTAIN ANY RELIEF WHATSOEVER IN CONNECTION WITH
THIS INDENTURE OR THE SECURITIES SHALL BE BROUGHT BY THE COM-
PANY EXCLUSIVELY IN THE COURTS OF THE STATE OF NEW YORK OR IN
ANY FEDERAL COURT SITTING IN THE CITY OF NEW YORK, STATE OF NEW
YORK.
SECTION 10.10. No Recourse Against Others. A direc-
tor, officer, employee or stockholder, as such, of the Company
<PAGE>
-73-
shall not have any liability for any obligations of the Company
under the Securities or this Indenture or for any claim based
on, in respect of or by reason of such obligations or their
creation. By accepting a Security, each Securityholder shall
waive and release all such liability. The waiver and release
shall be part of the consideration for the issue of the
Securities.
SECTION 10.11. Successors. All agreements of the
Company in this Indenture, and the Securities shall bind their
respective successors. All agreements of the Trustee in this
Indenture shall bind its successors.
SECTION 10.12. Multiple Originals. The parties may
sign any number of copies of this Indenture. Each signed copy
shall be an original, but all of them together represent the
same agreement. One signed copy is enough to prove this
Indenture.
<PAGE>
-74-
SIGNATURES
IN WITNESS WHEREOF, the undersigned, being duly
authorized, have executed this Indenture on behalf of the
respective parties hereto as of the date first above written.
SEQUA CORPORATION
By /s/ Kenneth A. Drucker ATTEST: /s/ Ira A. Schreger
Name: Kenneth A. Drucker
(Seal)
Title: Vice President & Treasurer
IBJ SCHRODER BANK & TRUST COMPANY, as trustee
By /s/ Barbara McCluskey ATTEST: /s/ Susan Lavelle
Name: Barbara McCluskey
(Seal)
Title: Assistant Vice President
Exhibit 4.7
SEQUA CORPORATION
$175,000,000
9-3/8% Senior Subordinated Notes due December 15, 2003
____________________
INDENTURE
Dated as of December 15, 1993
____________________
BANKERS TRUST COMPANY, Trustee
<PAGE>
CROSS REFERENCE TABLE
TIA Indenture
Section Section
310(a)(1)......................................... 7.10
(a)(2)......................................... 7.10
(a)(3)......................................... N.A.*
(a)(4)......................................... N.A.
(b)............................................ 7.08; 7.10
(c)............................................ N.A.
311(a)............................................ 7.11
(b)............................................ 7.11
(c)............................................ N.A.
312(a)............................................ 2.05
(b)............................................ 11.03
(c)............................................ 11.03
313(a)............................................ 7.06
(b)(1)......................................... N.A.
(b)(2)......................................... 7.06
(c)............................................ 7.06
(d)............................................ 7.06
314(a)............................................ 4.02; 4.03;
4.04
(b)............................................ N.A.
(c)(1)......................................... 11.04
(c)(2)......................................... 11.04
(c)(3)......................................... N.A.
(d)............................................ N.A.
(e)............................................ 11.04; 11.05
(f)............................................ N.A.
315(a)............................................ 7.01
(b)............................................ 7.05
(c)............................................ 7.01
(d)............................................ 7.01
(e)............................................ 6.11
316(a)(last sentence)............................. 2.08
(a)(1)(A)...................................... 6.05
(a)(1)(B)...................................... 6.04
(a)(2)......................................... N.A.
(b)............................................ 6.07
(c)............................................ 9.04
317(a)(1)......................................... 6.08
(a)(2)......................................... 6.09
(b)............................................ 2.04
___________________
* N.A. means Not Applicable.
<PAGE>
318(a)............................................ 11.01
-ii-
<PAGE>
TABLE OF CONTENTS
Page
ARTICLE 1 DEFINITIONS AND INCORPORATION BY REFERENCE..... 1
SECTION 1.01. Definitions....................... 1
SECTION 1.02. Other Definitions................. 20
SECTION 1.03. Incorporation by Refer-
ence of Trust Indenture
Act ............................ 20
SECTION 1.04. Rules of Construction............. 21
SECTION 1.05. Acts of Holders................... 21
ARTICLE 2 THE SECURITIES................................. 23
SECTION 2.01. Form and Dating................... 23
SECTION 2.02. Execution and
Authentication.................. 23
SECTION 2.03. Registrar and Paying
Agent........................... 24
SECTION 2.04. Paying Agent to Hold
Money in Trust.................. 25
SECTION 2.05. Securityholder Lists.............. 25
SECTION 2.06. Transfer and Exchange............. 26
SECTION 2.07. Replacement Securities............ 26
SECTION 2.08. Outstanding Securities;
Determinations of Hold-
ers' Action..................... 27
SECTION 2.09. Temporary Securities.............. 28
SECTION 2.10. Cancellation...................... 29
SECTION 2.11. CUSIP Numbers..................... 29
SECTION 2.12. Defaulted Interest................ 30
ARTICLE 3 REDEMPTION..................................... 30
SECTION 3.01. Right to Redeem; Notices
to Trustee...................... 30
SECTION 3.02. Public Equity Offering
Redemption...................... 30
SECTION 3.03. Mandatory Redemption.............. 30
SECTION 3.04. Selection of Securities
to Be Redeemed.................. 31
SECTION 3.05. Notice of Redemption.............. 31
SECTION 3.06. Effect of Notice of
Redemption...................... 32
SECTION 3.07. Deposit of Redemption
Price........................... 33
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<PAGE>
Page
SECTION 3.08. Securities Redeemed in
Part............................ 33
ARTICLE 4 COVENANTS...................................... 33
SECTION 4.01. Payment of Securities............. 33
SECTION 4.02. [Intentionally Omitted]........... 33
SECTION 4.03. SEC Reports....................... 33
SECTION 4.04. Compliance Certificates........... 34
SECTION 4.05. Payment of Taxes and
Other Claims.................... 35
SECTION 4.06. Waiver of Stay, Extension
or Usury Laws................... 35
SECTION 4.07. Corporate Existence............... 36
SECTION 4.08. Limitation on Restricted
Payments........................ 36
SECTION 4.09. Limitation on Additional
Indebtedness.................... 38
SECTION 4.10. Limitation on Indebted-
ness and Disqualified
Stock of Restricted
Subsidiaries.................... 38
SECTION 4.11. Limitation on Liens............... 39
SECTION 4.12. Limitation on Dividend
and Other Payment
Restrictions Affecting
Restricted Subsidiaries......... 39
SECTION 4.13. Limitation on Sale and
Leaseback Transactions.......... 40
SECTION 4.14. Limitation on Transac-
tions with Affiliates........... 41
SECTION 4.15. Repurchase Upon Change of
Control......................... 42
SECTION 4.16. Limitation on Asset Sales......... 45
SECTION 4.17. Maintenance of Properties
and Insurance................... 49
SECTION 4.18. Payments for Consents............. 49
SECTION 4.19. Limitation on Applicabil-
ity of Certain
Covenants....................... 50
SECTION 4.20. Further Assurances................ 50
SECTION 4.21. Limitation on Senior Sub-
ordinated Debt.................. 50
ARTICLE 5 SUCCESSOR CORPORATION.......................... 51
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<PAGE>
Page
SECTION 5.01. Limitation on Merger,
Consolidation and Sale
of Substantially All
Assets.......................... 51
SECTION 5.02. Successor Corporation
Substituted..................... 52
ARTICLE 6 DEFAULTS AND REMEDIES.......................... 53
SECTION 6.01. Events of Default................. 53
SECTION 6.02. Acceleration...................... 54
SECTION 6.03. Other Remedies.................... 55
SECTION 6.04. Waiver of Past Defaults........... 55
SECTION 6.05. Control by Majority............... 55
SECTION 6.06. Limitation on Suits............... 56
SECTION 6.07. Rights of Holders to
Receive Payment................. 56
SECTION 6.08. Collection Suit by
Trustee......................... 57
SECTION 6.09. Trustee May File Proofs
of Claim........................ 57
SECTION 6.10. Priorities........................ 58
SECTION 6.11. Undertaking for Costs............. 58
ARTICLE 7 TRUSTEE........................................ 58
SECTION 7.01. Duties of Trustee................. 58
SECTION 7.02. Rights of Trustee................. 60
SECTION 7.03. Individual Rights of
Trustee......................... 61
SECTION 7.04. Trustee's Disclaimer.............. 61
SECTION 7.05. Notice of Defaults................ 62
SECTION 7.06. Reports by Trustee to
Holders......................... 62
SECTION 7.07. Compensation and
Indemnity....................... 62
SECTION 7.08. Replacement of Trustee............ 63
SECTION 7.09. Successor Trustee by
Merger.......................... 64
SECTION 7.10. Eligibility;
Disqualification................ 64
SECTION 7.11. Preferential Collection
of Claims Against
Company......................... 65
ARTICLE 8 DISCHARGE OF INDENTURE......................... 65
-v-
<PAGE>
Page
SECTION 8.01. Discharge of Liability on
Securities; Defeasance.......... 65
SECTION 8.02. Conditions to Defeasance.......... 66
SECTION 8.03. Application of Trust
Money........................... 68
SECTION 8.04. Repayment to the Company.......... 68
SECTION 8.05. Indemnity for Government
Obligations..................... 69
SECTION 8.06. Reinstatement..................... 69
ARTICLE 9 AMENDMENTS..................................... 70
SECTION 9.01. Without Consent of
Holders......................... 70
SECTION 9.02. With Consent of Holders........... 70
SECTION 9.03. Compliance with Trust
Indenture Act................... 71
SECTION 9.04. Revocation and Effect of
Consents, Waivers and
Actions......................... 72
SECTION 9.05. Notation on or Exchange
of Securities................... 72
SECTION 9.06. Trustee to Sign Supple-
mental Indentures............... 73
SECTION 9.07. Effect of Supplemental
Indentures...................... 73
ARTICLE 10 SUBORDINATION.................................. 73
SECTION 10.01. Agreement to Subordinate;
Certain Definitions............. 73
SECTION 10.02. Liquidation; Dissolution;
Bankruptcy...................... 74
SECTION 10.03. Default on Senior Debt............ 75
SECTION 10.04. No Suspension of Remedies......... 76
SECTION 10.05. When Distributions Must
Be Paid Over.................... 76
SECTION 10.06. Notice by Company................. 78
SECTION 10.07. Subrogation....................... 78
SECTION 10.08. Relative Rights................... 78
SECTION 10.09. Subordination May Not Be
Impaired by Company............. 78
SECTION 10.10. Distribution or Notice to
Representative.................. 79
SECTION 10.11. Rights of Trustee and
Paying Agent.................... 79
-vi-
<PAGE>
Page
SECTION 10.12. Authorization to Effect
Subordination................... 80
ARTICLE 11 MISCELLANEOUS.................................. 80
SECTION 11.01. Trust Indenture Act
Controls........................ 80
SECTION 11.02. Notices........................... 80
SECTION 11.03. Communication by Holders
with Other Holders.............. 81
SECTION 11.04. Certificate and Opinion
as to Conditions
Precedent....................... 81
SECTION 11.05. Statements Required in
Certificate or Opinion ......... 81
SECTION 11.06. Separability Clause............... 82
SECTION 11.07. Rules by Trustee, Paying
Agent and Registrar............. 82
SECTION 11.08. Legal Holidays.................... 82
SECTION 11.09. GOVERNING LAW AND CHOICE
OF FORUM........................ 82
SECTION 11.10. No Recourse Against
Others.......................... 83
SECTION 11.11. Successors........................ 83
SECTION 11.12. Multiple Originals................ 83
SIGNATURES................................................. 84
EXHIBIT A..................................................A-1
-vii-
<PAGE>
INDENTURE, dated as of December 15, 1993, between
Sequa Corporation, a Delaware corporation (the "Company"), and
Bankers Trust Company, a New York banking corporation, as trus-
tee (the "Trustee").
Each party agrees as follows for the benefit of the
other party and for the equal and ratable benefit of the hold-
ers of the Company's 9-3/8% Senior Subordinated Notes due
December 15, 2003:
ARTICLE 1
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01. Definitions.
"Acquired Debt" means, with respect to any specified
Person, (i) Indebtedness of any other Person or any of its Sub-
sidiaries existing at the time such other Person merged with or
into or became a Subsidiary of such specified Person, including
Indebtedness incurred in connection with, or in contemplation
of, such other Person merging with or into or becoming a Sub-
sidiary of such specified Person and (ii) Indebtedness encum-
bering any asset acquired by such specified Person or assumed
by such specified Person in connection with the acquisition of
assets.
"Affiliate" of any specified Person means any other
Person who directly or indirectly through one or more interme-
diaries controls or is controlled by, or is under common con-
trol with such specified Person. For purposes of this defini-
tion, "control" (including, with correlative meanings, the
terms "controlling," "controlled by" and "under common control
with"), as used with respect to any Person, shall mean the
possession, directly or indirectly, of the power to direct or
cause the direction of the management or policies of such Per-
son, whether through the ownership of voting securities, by
agreement or otherwise.
"ARC" means Atlantic Research Corporation, a Delaware
corporation.
"ARC Minority Interest" means the Equity Interests of
ARC held by Bankers Trust New York Corporation as of the date
of this Indenture.
"ARC Stock Purchase and Restriction Agreement" means
the Stock Purchase and Restriction Agreement, dated December
<PAGE>
-2-
19, 1989, among the Company, ARC, Chromalloy Gas Turbine Corpo-
ration and Bankers Trust New York Corporation.
"Asset Sale" means any direct or indirect sale, issu-
ance, conveyance, transfer, capital lease, assignment or other
transfer for value (including any sale and leaseback transac-
tion) by the Company or any of its Restricted Subsidiaries to
any Person other than the Company or a Restricted Subsidiary of
the Company of (i) any Equity Interests of any Subsidiary of
the Company or (ii) any other property or assets of the Company
or any Restricted Subsidiary of the Company (including a con-
solidation or merger or other sale of any Restricted Subsidiary
with, into or to another Person in a transaction in which such
Restricted Subsidiary ceases to be a Restricted Subsidiary),
other than (x) the sale of inventory or obsolete equipment in
the ordinary course of business consistent with past practice
or (y) any transaction or series of related transactions for
which the Company or its Restricted Subsidiaries receive aggre-
gate consideration of less than $2.5 million.
"Attributable Indebtedness" means, with respect to
any sale and leaseback transaction, as at the time of determi-
nation, the greater of (i) the Fair Market Value of the prop-
erty subject to such arrangement and (ii) the present value
(discounted at a rate equivalent to the Company's then current
weighted average cost of funds for borrowed money, compounded
on a semi-annual basis) of the total obligations of the lease
for rental payments during the remaining term of the lease
included in such arrangement (including any period for which
such lease has been extended).
"Bankruptcy Law" means Title 11, United States Code,
or any similar Federal or state law for the relief of debtors.
"Board of Directors" of any corporation means the
Board of Directors of such corporation, or any duly authorized
committee of such Board of Directors.
"Business Day" means any day that is not a Saturday,
a Sunday or a day on which banking institutions are required to
close in New York, New York or in the city that the Trustee or
the Paying Agent is located.
"Capital Lease Obligation" means, as to any Person,
the Obligations of such Person in respect of a lease that would
at such time be required to be classified and accounted for as
capitalized lease obligations under GAAP and the amount of such
<PAGE>
-3-
obligations at any date shall be the capitalized amount of such
obligations at such date, determined in accordance with GAAP.
"Capital Stock" means (i) with respect to any Person
formed as a corporation, any and all shares, interests, partic-
ipations, rights or other equivalents (however designated) of
corporate stock, including, without limitation, common stock
and preferred stock of such Person and (ii) with respect to any
Person formed other than as a corporation, any and all partner-
ship or other equity interests of such other Person.
"Cash Equivalents" means:(i) United States dollars;
(ii) securities issued or directly and fully guaranteed or
insured by the United States government or any agency or
instrumentality thereof having maturities of not more than six
months from the date of acquisition; (iii) certificates of
deposit and eurodollar time deposits with maturities of six
months or less from the date of acquisition, bankers' acceptan-
ces with maturities not exceeding six months and overnight bank
deposits, in each case with any lender party to the New Credit
Facility or with any domestic commercial bank having capital
and surplus in excess of $500 million; (iv) repurchase obliga-
tions with a term of not more than seven days for underlying
securities of the types described in clauses (ii) and (iii)
entered into with any financial institution meeting the quali-
fications specified in clause (iii) above; (v) commercial paper
rated A-1 or the equivalent thereof by Moody's Investors Ser-
vice, Inc. or Standard & Poor's Ratings Group and in each case
maturing within six months after the date of acquisition; and
(vi) investments in money market funds which invest substan-
tially all their assets in securities of the types described in
clauses (i) through (v) above.
"Change of Control" means the occurrence of any of
the following: (i) the sale, lease, exchange or other trans-
fer, in one or a series of related transactions, of all or sub-
stantially all of the Company's assets to any Person or group
of related Persons (a "Group") (as such term is used in Section
13(d) of the Exchange Act); (ii) the adoption of a plan by the
stockholders of the Company relating to the liquidation or dis-
solution of the Company; (iii) except as provided below, the
acquisition of beneficial ownership by any Person or Group,
together with any Affiliates thereof (collectively, the "Inter-
ested Stockholders"), of a direct or indirect interest in more
than 35% of the voting power of the then outstanding Capital
Stock of the Company entitled to vote generally in the election
of the Board of Directors of the Company; or (iv) during any
<PAGE>
-4-
period of two consecutive years, individuals who at the begin-
ning of such period constituted the Company's Board of Direc-
tors (together with any new directors whose election or
appointment by such board or whose nomination for election or
appointment by the shareholders of the Company was approved by
a vote of a majority of the directors then still in office who
were either directors at the beginning of such period or whose
election or nomination for election was previously so approved)
cease for any reason to constitute a majority of the Company's
Board of Directors then in office; provided, however, that for
the purposes of the foregoing clauses (i) and (iii), the terms
"Person" or "Group" shall not be deemed to include Mr.
Alexander, his spouse, any descendant of Mr. Alexander or the
spouse of any such descendant, the estate of Mr. Alexander, or
any trust or other similar arrangement for the benefit of Mr.
Alexander or his spouse, any descendant of Mr. Alexander or the
spouse of any such descendant or the estate of Mr. Alexander or
any corporation or other Person controlled solely by one or
more of Mr. Alexander or his spouse, any descendant of Mr.
Alexander or the spouse of any such descendant or the estate of
Mr. Alexander through the ownership of a majority of the out-
standing voting Capital Stock of such corporation or other Per-
son (collectively, the "Alexander Stockholders"); and provided,
further, that there shall not be a "Change of Control" pursuant
to clause (iii) above so long as the Alexander Stockholders
beneficially own a greater percentage of the voting power of
the then outstanding Capital Stock of the Company than the
Interested Stockholders.
"Consolidated EBITDA" means, with respect to any Per-
son, for any period, the sum (without duplication) of (i) Con-
solidated Net Income of such Person for such period and (ii) to
the extent Consolidated Net Income has been reduced thereby,
Consolidated Tax Expense, Consolidated Interest Expense and
Consolidated Non-Cash Charges of such Person for such period
and, with respect to the Company, extraordinary losses result-
ing from the Company's redemption of its outstanding 10>%
Senior Subordinated Notes due 1998, less all non-cash items to
the extent Consolidated Net Income has been increased thereby.
"Consolidated Fixed Charges" means, with respect to
any Person, the sum, without duplication, of (i) Consolidated
Interest Expense of such Person and (ii) the product of (x) the
amount of all cash and non-cash dividend payments on any series
of preferred stock of such Person and its Restricted Subsidiar-
ies (except dividends for such period which are accrued but
unpaid) times (y) a fraction, the numerator of which is one and
<PAGE>
-5-
the denominator of which is one minus the then current effec-
tive consolidated federal, state and local tax rate of such
Person, expressed as a decimal.
"Consolidated Interest Coverage Ratio" means with
respect to any Person, the ratio of (i) Consolidated EBITDA of
such Person during the Four Quarter Period next preceding the
date of the transaction or event giving rise to the need to
calculate the Consolidated Interest Coverage Ratio (the "Trans-
action Date") to (ii) Consolidated Fixed Charges for such Per-
son for such Four Quarter Period. For purposes of this defini-
tion, "Consolidated EBITDA" and "Consolidated Fixed Charges"
shall be calculated after giving effect on a pro forma basis
for the Four Quarter Period to (i) the incurrence or repayment
of any Indebtedness of such Person or any of its Restricted
Subsidiaries at any time on or subsequent to the last day of
the Four Quarter Period and on or prior to the Transaction
Date, as if such incurrence or repayment, as the case may be
(and the application of the proceeds thereof), occurred on the
first day of the Four Quarter Period and (ii) any Asset Sales
or other asset dispositions of such Person and its Restricted
Subsidiaries occurring at any time on or subsequent to the last
day of the Four Quarter Period and on or prior to the Transac-
tion Date, as if such Asset Sale or other asset disposition
occurred on the first day of the Four Quarter Period. If such
Person or any of its Restricted Subsidiaries directly or indi-
rectly guarantees Indebtedness of a third Person, the preceding
sentence shall give effect to the incurrence of such guaranteed
Indebtedness as if such Person or any Restricted Subsidiary of
such Person had directly incurred or otherwise assumed such
guaranteed Indebtedness. Furthermore, in calculating "Consoli-
dated Fixed Charges": (i) interest on Indebtedness determined
on a fluctuating basis as of the Transaction Date and which
will continue to be so determined thereafter shall be deemed to
have accrued at a fixed rate per annum equal to the rate of the
interest on such Indebtedness in effect on the Transaction
Date; (ii) interest on any Indebtedness under a revolving
credit facility computed on a pro forma basis shall be computed
based upon the average daily balance of such Indebtedness dur-
ing the Four Quarter Period; (iii) if interest on any Indebted-
ness actually incurred on the Transaction Date may optionally
be determined at an interest rate based upon a factor of a
prime or similar rate, a eurocurrency interbank offered rate,
or other rates, then the interest rate in effect on the Trans-
action Date will be deemed to have been in effect during the
Four Quarter Period; and (iv) notwithstanding clause (i) above,
interest on Indebtedness determined on a fluctuating basis to
<PAGE>
-6-
the extent such interest is covered by Hedging Obligations,
shall be deemed to accrue at the rate per annum resulting after
giving effect to the operation of such Hedging Obligations.
"Consolidated Interest Expense" means, with respect
to any Person, for any period, the aggregate amount of all cash
and non-cash interest expense of such Person and its Restricted
Subsidiaries for such period, on a consolidated basis deter-
mined in accordance with GAAP, including all cash and non-cash
interest expense in respect of guarantees of Indebtedness by
such Person and its Restricted Subsidiaries, excluding the
amortization or write-off of deferred financing costs and the
interest expense in respect of the Indebtedness of Sequa Capi-
tal referred to in clause (v) under Section 4.10 hereof
included in cash or non-cash interest expense.
"Consolidated Net Income" means, with respect to any
Person, for any period, the aggregate of the net income (or
loss) of such Person and its Subsidiaries (after minority
interests) for such period on a consolidated basis determined
in accordance with GAAP; provided, however, that there shall be
excluded therefrom: (i) net gains or losses from Asset Sales
or other dispositions of assets other than in the ordinary
course of business; (ii) any gains or losses from currency
exchange transactions not in the ordinary course of business
consistent with past practice; (iii) items classified as extra-
ordinary, non-recurring or unusual gains, and the related tax
effects, each as determined in accordance with GAAP; (iv) the
net income of any Person acquired by such Person or a
Restricted Subsidiary of such Person in a pooling of interests
transaction for any period prior to the date of the transac-
tion; (v) the net income of any Restricted Subsidiary of such
Person to the extent such Restricted Subsidiary has any
restrictions or encumbrances on making distributions to the
Company or another Restricted Subsidiary of the Company by con-
tract, operation of law or otherwise; and (vi) the net income
of any Person that is not a Restricted Subsidiary of such Per-
son except to the extent of the amount of dividends or other
distributions actually paid to such Person by such other Person
during such period.
"Consolidated Net Worth" means, with respect to any
Person, as of any date, the sum of (i) the consolidated equity
of the common stockholders of such Person and its consolidated
Restricted Subsidiaries as of such date plus (ii) the respec-
tive amounts reported on such Person's balance sheet as of such
date with respect to any series of preferred stock (other than
<PAGE>
-7-
Disqualified Stock) that by its terms is not entitled to the
payment of dividends unless such dividends may be declared and
paid only out of net earnings in respect of the year of such
declaration and payment, but only to the extent of any cash
received by such Person upon issuance of such preferred stock,
less (x) all write-ups (other than write-ups resulting from
foreign currency translations and write-ups of tangible assets
of a going concern business made within 12 months after the
acquisition of such business) subsequent to the date of this
Indenture in the book value of any asset owned by such Person
or a consolidated Restricted Subsidiary of such Person, (y) all
investments as of such date in unconsolidated Subsidiaries and
in Persons that are not Restricted Subsidiaries (except, in
each case, represented by Permitted Investments), and (z) all
unamortized debt discount and expense and unamortized deferred
charges as of such date, all of the foregoing as determined in
accordance with GAAP.
"Consolidated Non-Cash Charges" of any Person means,
for any period, the aggregate depreciation, amortization
(including write-off of deferred financing costs) and other
non-cash charges of such Person and its Restricted Subsidiaries
for such period, on a consolidated basis determined in accor-
dance with GAAP (excluding any such non-cash charge which
requires an accrual or reserve for cash charges for any future
period and excluding any such non-cash charge that is included
in Consolidated Interest Expense or Consolidated Tax Expense).
"Consolidated Tax Expense" means, with respect to any
Person, for any period, the aggregate expenses (or provisions)
of such Person and its Restricted Subsidiaries with respect to
all applicable taxes for such period, on a consolidated basis,
determined in accordance with GAAP.
"Custodian" means any receiver, trustee, assignee,
liquidator, sequestrator, custodian or similar official under
any Bankruptcy Law.
"Defaults" means any event or condition that is or
with the passage of time or the giving of notice or both would
be an Event of Default.
"Disqualified Stock" means (i) any Capital Stock
which, by its terms (or by the terms of any security into which
it is convertible or for which it is exchangeable), or upon the
happening of any event, matures or is mandatorily redeemable,
pursuant to a sinking fund obligation or otherwise, or
<PAGE>
-8-
redeemable at the option of the holder thereof, in whole or in
part, on or prior to the final stated maturity of the Securi-
ties, or (ii) any warrants, options or other rights to acquire
any such Capital Stock referred to in clause (i) above.
"Equity Interests" means Capital Stock and all war-
rants, options or other rights to acquire Capital Stock (but
excluding any debt security that is convertible into or
exchangeable for Capital Stock).
"Exchange Act" means the Securities Exchange Act of
1934, as amended.
"Existing Indebtedness" means Indebtedness of the
Company and its Restricted Subsidiaries (other than under the
New Credit Facility) in existence on the date of this Inden-
ture, until such amounts are repaid.
"Fair Market Value" means, with respect to any asset
or property, the sale value that would be obtained in an arm's
length transaction between an informed and willing seller under
no compulsion to sell and an informed and willing buyer under
no compulsion to buy. Unless otherwise provided, Fair Market
Value shall be determined by a majority of the disinterested
members of the Board of Directors and, if such Fair Market
Value is in excess of $1.0 million, then such Fair Market Value
shall be evidenced by a resolution of the Board of Directors
and set forth in an Officer's Certificate delivered to the
Trustee.
"Foreign Asset Sale" means any Asset Sale in respect
of the Capital Stock and/or property of any Foreign Restricted
Subsidiary to the extent that the proceeds of such Asset Sale
are received by a Person subject in respect of such proceeds to
the tax laws of a jurisdiction other than the United States of
America or any state thereof or the District of Columbia or to
currency exchange laws of a jurisdiction other than the United
States of America or any state thereof or the District of
Columbia, in either case that prohibit the repatriation of such
proceeds to the United States.
"Foreign Restricted Subsidiary" means, for any Per-
son, any Restricted Subsidiary of such Person that conducts
substantially all of its operations outside of the United
States and is organized under the laws of any jurisdiction out-
side the United States.
<PAGE>
-9-
"Four Quarter Period" means the most recent four fis-
cal quarters for which financial information is available.
"GAAP" means generally accepted accounting principles
set forth in the opinions and pronouncements of the Accounting
Principles Board of the American Institute of Certified Public
Accountants and statements and pronouncements of the Financial
Accounting Standards Board or in such other statements by such
other entity as approved by a significant segment of the
accounting profession, which are in effect as of the date of
this Indenture.
"Hedging Obligations" means, with respect to any Per-
son, the obligations of such Person determined in accordance
with GAAP under interest rate swap agreements, interest rate
cap agreements, currency swap agreements and other agreements
or arrangements designed to protect such Person against fluctu-
ations in interest rates or currency exchange rates.
"Holder" or "Securityholder" means a Person in whose
name a Security is registered on the Registrar's books.
"Indebtedness" means, with respect to any Person, any
indebtedness of such Person, contingent or otherwise, in
respect of borrowed money, including all principal, interest,
fees and expenses with respect thereto (whether or not the
recourse of the lender is to the whole of the assets of such
person or only to a portion thereof), or evidenced by bonds,
notes, debentures or similar instruments or letters of credit
or banker's acceptances (or reimbursement obligations with
respect thereto) or representing the balance deferred and
unpaid of the purchase price of any property (including pursu-
ant to financing leases), if and to the extent any of the fore-
going indebtedness would appear as a liability upon a balance
sheet of such Person prepared in accordance with GAAP (except
that any such balance that constitutes a trade payable and/or
accrued liability arising in the ordinary course of business
shall not be considered Indebtedness), and shall also include,
to the extent not otherwise included, interest accruing after
the commencement of any bankruptcy, insolvency, receivership or
similar proceeding and other interest that would have accrued
but for the commencement of such proceeding, any Capital Lease
Obligations, the maximum fixed repurchase price of any Disqual-
ified Stock, indebtedness secured by a Lien to which the prop-
erty or assets owned or held by such Person is subject, whether
or not the obligations secured thereby shall have been assumed
by such Person, guarantees of items that would be included
<PAGE>
-10-
within this definition to the extent of such guarantees (exclu-
sive of whether such items would appear upon such balance
sheet), and Hedging Obligations. For purposes of the preceding
sentence, the maximum fixed repurchase price of any Disquali-
fied Stock which does not have a fixed repurchase price shall
be calculated in accordance with the terms of such Disqualified
Stock as if such Disqualified Stock were repurchased on any
date on which Indebtedness shall be required to be determined
pursuant to this Indenture, provided that such Disqualified
Stock is not then permitted to be repurchased, the repurchase
price shall be the book value of such Disqualified Stock. The
amount of Indebtedness of any Person at any date shall be,
without duplication, (i) the outstanding balance at such date
of all unconditional obligations as described above and the
maximum liability of any such contingent obligations at such
date and (ii) in the case of Indebtedness of others secured by
a Lien to which the property or assets owned or held by such
Person is subject, the lesser of the Fair Market Value at such
date of any asset subject to a Lien securing the Indebtedness
of others and the amount of the Indebtedness secured.
"Indenture" means this Indenture, as amended or sup-
plemented from time to time in accordance with the terms
hereof, including the provisions of the TIA that are deemed to
be a part hereof.
"Investments" means, with respect to any Person, all
investments by such Person in other Persons (including Affili-
ates) in the forms of loans (including guarantees), advances or
capital contributions, by means of transfers of cash or other
property (excluding credit sales, commission, travel and simi-
lar advances to officers and employees made in the ordinary
course of business), purchases or other acquisitions for con-
sideration of Indebtedness, Equity Interests or other securi-
ties and all other items that are or would be classified as
investments on a balance sheet prepared in accordance with
GAAP.
"Lien" means, with respect to any asset, any mort-
gage, lien, pledge, charge, security interest or encumbrance of
any kind in respect of such asset, whether or not filed,
recorded or otherwise perfected under applicable law (including
any conditional sale or other title retention agreement, any
lease in the nature thereof, any option or other agreement to
sell or give a security interest in and any filing of or agree-
ment to give any financing statement under the Uniform Commer-
cial Code (or equivalent statute) of any jurisdiction).
<PAGE>
-11-
"Net Cash Proceeds" means the aggregate cash proceeds
or Cash Equivalents received by the Company or any of its
Restricted Subsidiaries in respect of any Asset Sale, including
any cash or Cash Equivalents received by way of (i) conversion
of any Indebtedness received in connection with such Asset
Sale, (ii) deferred payment of principal pursuant to, or liqui-
dation of, any Indebtedness received in connection with such
Asset Sale or (iii) any dividends on or distributions in
respect of, or the direct or indirect sale, exchange, conver-
sion or other disposition of, any Equity Interests received by
the Company or any of its Restricted Subsidiaries in respect of
any Asset Sale, net of the direct costs relating to such Asset
Sale (including, without limitation, legal, accounting and
investment banking fees, and sales commissions), taxes paid or
payable as a result thereof (after taking into account any
available tax credits or deductions and any tax sharing
arrangements), amounts required to be applied to the repayment
of Indebtedness secured by a lien on the asset or assets that
are the subject of such Asset Sale and any reserve for adjust-
ment in respect of the sale price of such asset or assets.
"New Credit Facility" means the Credit Agreement,
dated as of December 14, 1993, among the Company, the lenders
referred to therein, and The Bank of New York, as agent, as the
same may be amended from time to time, and any agreement evi-
dencing the refinancing, modification, replacement, renewal,
restatement, refunding, deferral, extension, substitution, sup-
plement, reissuance or resale thereof.
"Obligations" means all obligations for principal,
premium, interest, penalties, fees, indemnifications, reim-
bursements, damages and other liabilities payable under the
documentation governing any Indebtedness.
"Officer" means, with respect to any corporation
(including the Company), the Chairman of the Board, the Presi-
dent, any Vice President, the Chief Financial Officer, the
Treasurer or the Secretary of such corporation.
"Officer of the Trustee," when used with respect to
the Trustee, means the cashier, any assistant cashier, the
chairman or vice-chairman of the Board of Directors, the chair-
man or vice-chairman of the executive committee of the Board of
Directors, the president, any vice president, any assistant
vice president, the secretary, any assistant secretary, the
controller and any assistant controller, the treasurer, any
assistant treasurer, any trust officer or assistant trust
<PAGE>
-12-
officer or any other officer of the Trustee customarily per-
forming functions similar to those performed by any of the
above designated officers, and also means, with respect to a
particular corporate trust matter, any other officer to whom
such matter is referred because of his knowledge of and famil-
iarity with the particular subject.
"Officers' Certificate" means a written certificate
containing the information specified in Sections 11.04 and
11.05 herein, signed in the name of the Company by any two of
its Officers (one of which shall be, in the case of the Offic-
ers' Certificate delivered pursuant to Section 4.04(a) hereof,
the principal executive officer, principal financial officer or
principal accounting officer of the Company), and delivered to
the Trustee.
"Opinion of Counsel" means a written opinion
addressed to the Trustee and containing the information speci-
fied in Sections 11.04 and 11.05 hereof, rendered by legal
counsel and delivered to the Trustee.
"Permitted Indebtedness" means: (i) the incurrence
by the Company of Indebtedness under the New Credit Facility in
an aggregate principal amount not to exceed $145 million, less
amounts that have been applied since the date of this Indenture
to permanently reduce the outstanding amount of such Indebted-
ness; (ii) the incurrence by the Company of other Indebtedness
(other than Indebtedness described in clauses (i) (iii) and (v)
hereof) in an aggregate principal amount not to exceed $50 mil-
lion at any one time outstanding, less any Indebtedness of For-
eign Restricted Subsidiaries incurred pursuant to clause
(vii)(y) (but not clause (vii)(x)) under Section 4.10 hereof;
(iii) the incurrence by the Company of Indebtedness represented
by the Securities and the Senior Notes; (iv) Existing Indebted-
ness of the Company; (v) the incurrence by the Company of
Indebtedness issued in exchange for, or the proceeds of which
are used to extend, refinance, renew, replace, defease or
refund Indebtedness referred to in clauses (i), (ii), (iii) or
(iv) above (the "Refinancing Indebtedness"); provided, however,
that (x) the principal amount of such Refinancing Indebtedness
shall not exceed the principal amount of Indebtedness so
extended, refinanced, renewed, replaced, defeased or refunded,
(y) the Refinancing Indebtedness shall have a Weighted Average
Life to Maturity equal to or greater than the Weighted Average
Life to Maturity of the Indebtedness so extended, refinanced,
renewed, replaced, defeased or refunded and the Securities, and
(z) the Refinancing Indebtedness shall be ranked in right of
<PAGE>
-13-
payment to the Securities on terms at least as favorable to the
holders of such Securities as those contained in the documenta-
tion governing the Indebtedness so extended, refinanced,
renewed, replaced, defeased or refunded; (vi) intercompany
Indebtedness arising in the ordinary course of business owing
by the Company to its Wholly Owned Restricted Subsidiaries or
ARC; (vii) the incurrence by the Company of Hedging Obligations
with respect to Indebtedness permitted to be incurred by this
Indenture; (viii) Acquired Debt of a Subsidiary existing at the
time of the acquisition of such Subsidiary by the Company or
any Subsidiary; provided, however, that (a) such Indebtedness
shall not have been created in contemplation of such acquisi-
tion and (b) after giving pro forma effect to such acquisition,
the Company could incur $1.00 of additional Indebtedness (other
than Permitted Indebtedness) pursuant to the provisions of Sec-
tion 4.09 hereof; and (ix) guarantees of Indebtedness of the
Company's Restricted Subsidiaries incurred in accordance with
the provisions of this Indenture.
"Permitted Investments" means: (i) any Investments
in the Company or in a Wholly Owned Restricted Subsidiary of
the Company that is engaged in the same or a similar line of
business as the Company and its Restricted Subsidiaries were
engaged in on the date of this Indenture; (ii) any Investments
in Cash Equivalents; (iii) Investments by the Company or any
Restricted Subsidiary thereof in a Person engaged in the same
or similar line of business as the Company and its Restricted
Subsidiaries were engaged in on the date of this Indenture, if
as a result of such Investment (x) such Person becomes a Wholly
Owned Restricted Subsidiary of the Company and is engaged in
the same or a similar line of business as the Company or the
Restricted Subsidiaries were engaged in on the date of this
Indenture or (y) such Person is merged or consolidated with or
into, or transfers or conveys substantially all of its assets
to, or is liquidated into, the Company or a Wholly Owned
Restricted Subsidiary of the Company that is engaged in the
same or a similar line of business as the Company and its
Restricted Subsidiaries were engaged in on the date of this
Indenture; (iv) Investments by the Company or any Restricted
Subsidiary thereof in a Person if (a) no Affiliate of the Com-
pany or a Restricted Subsidiary (other than another Restricted
Subsidiary of the Company) has an Investment in such Person,
(b) such Person is engaged in the same or a similar line of
business as the Company and its Restricted Subsidiaries were
engaged in on the date of this Indenture, (c) the Company
and/or any of its Restricted Subsidiaries at all times owns at
least 50% of the total outstanding shares of Capital Stock of
<PAGE>
-14-
such Person entitled to participate in distributions in respect
of the earnings, sale or liquidation of such Person, (d) imme-
diately after giving effect to such Investment on a pro forma
basis (to give effect to the contribution of any property or
assets to such Person or Indebtedness incurred to fund such
Investment or otherwise), the Company could incur at least
$1.00 of additional Indebtedness (other than Permitted Indebt-
edness) pursuant to the provisions of Section 4.09 hereof and
(e) no default with respect to any Indebtedness of such Person
or any Subsidiary of such Person (including any right which the
holders thereof may have to take enforcement action against
such Person) would permit (upon notice, lapse of time or both)
any holder of any Indebtedness of the Company or its Restricted
Subsidiaries to declare a default on such Indebtedness or cause
the payment thereof to be accelerated or payable prior to its
final scheduled maturity; (v) Investments by the Company in any
Person in cash in an aggregate amount not to exceed $30 million
pursuant to contractual commitments in existence as of the date
of this Indenture; and (vi) Investments received by the Company
or its Restricted Subsidiaries as consideration for an Asset
Sale in compliance with the provisions of Section 4.16 hereof.
"Permitted Liens" means: (i) Liens in favor of the
Company; (ii) Liens in favor of the lenders under the New
Credit Facility to secure Obligations of the Company thereun-
der; (iii) Liens on property of a Person existing at the time
such Person is merged into or consolidated with the Company or
any Restricted Subsidiary thereof in a transaction not prohib-
ited by the terms of this Indenture; provided, however, that
such Liens were in existence prior to the contemplation of such
merger or consolidation; (iv) Liens on property existing at the
time of acquisition thereof by the Company or any Restricted
Subsidiary thereof in a transaction not prohibited by the terms
of this Indenture; provided, however, that such Liens were in
existence prior to the contemplation of such acquisition; (v)
Liens to secure the performance of statutory obligations,
surety or appeal bonds, performance bonds or other obligations
of a like nature incurred in the ordinary course of business;
(vi) Liens existing on the date of this Indenture; (vii) Liens
for taxes, assessments or governmental charges or claims that
are not yet delinquent or that are being contested in good
faith by appropriate proceedings promptly instituted and dili-
gently concluded; provided, however, that any reserve or other
appropriate provisions as shall be required in conformity with
GAAP shall have been made therefor; (viii) Liens securing pur-
chase money Indebtedness; provided, however, that the principal
amount of the Indebtedness secured by such Liens does not
<PAGE>
-15-
exceed 100% of such purchase price or cost, such Indebtedness
was permitted to be incurred by the terms of this Indenture and
such Liens do not extend to any assets of the Company and its
Restricted Subsidiaries other than the assets so acquired; (ix)
easements, rights-of-way, restrictions, minor defects or irreg-
ularities in title and other similar charges or encumbrances
not interfering in any material respect with the business of
the Company or any of its Subsidiaries; (x) Liens upon specific
items of inventory or other goods and proceeds of any Person
securing such Person's obligations in respect of bankers'
acceptances issued or created for the account of such Person to
facilitate the purchases, shipment or storage of such inventory
or other goods in the ordinary course of business; (xi) Liens
securing reimbursement obligations with respect to letters of
credit which encumber documents and other property relating to
such letters of credit and the products and proceeds thereof;
(xii) Liens in favor of customs and revenue authorities arising
as a matter of law to secure payment of nondelinquent customs
duties in connection with the importation of goods; (xiii)
judgment and attachment Liens not giving rise to a Default or
Event of Default; (xiv) Liens arising out of consignment or
similar arrangements for the sale of goods entered into by the
Company or any Restricted Subsidiary in the ordinary course of
business in accordance with industry practice; (xv) any inter-
est or title of a lessor in the property subject to any lease,
whether characterized as capitalized or operating, other than
any such interest or title resulting from or arising out of
default by the Company or any Restricted Subsidiary of its
obligations under such lease; (xvi) Liens arising from filing
UCC financing statements for precautionary purposes in connec-
tion with true leases of personal property that are otherwise
permitted under this Indenture and under which the Company or
any of its Subsidiaries is the lessee; (xvii) the pledge of
stock of Sequa Capital in connection with the Indebtedness of
Sequa Capital referred to in clause (v) of Section 4.10 hereof;
(xviii) Liens created under the Receivables Agreement; (xix)
Liens on assets of Foreign Restricted Subsidiaries securing
Indebtedness permitted by this Indenture; and (xx) extensions,
renewals or regranting of any Liens referred to above in con-
nection with any Refinancing Indebtedness permitted under this
Indenture.
"Person" means an individual, partnership, corpora-
tion, unincorporated organization, trust or joint venture, or a
governmental agency or subdivision thereof.
<PAGE>
-16-
"Public Equity Offering" means the first public
offering by the Company of Equity Interests of the Company that
is completed following the date of this Indenture.
"Receivables Agreement" means that certain amended
and restated receivables agreement, dated June 24, 1993, among
the Company, Sequa Receivables Corp. and the other signatories
thereto, and the related purchase and sale agreement and any
successor agreements thereto (including any agreement evidenc-
ing the refinancing, modification, replacement, renewal,
restatement, refunding, deferral, extension, substitution, sup-
plement, reissuance or resale thereof) pursuant to which the
Company may sell up to $100 million of trade receivables on a
non-recourse basis.
"Redemption Date" or "redemption date" means the date
specified for redemption of the Securities in accordance with
the terms of the Securities and this Indenture.
"Redemption Price" or "redemption price" shall have
the meaning set forth in paragraph 5 of the Securities.
"Representative" means the indenture trustee or other
trustee, agent or representative for any Senior Debt.
"Restricted Investment" means an Investment other
than a Permitted Investment.
"Restricted Subsidiary" means any Subsidiary other
than an Unrestricted Subsidiary.
"SEC" means the Securities and Exchange Commission.
"Securities" means the Securities issued under this
Indenture.
"Senior Note Indenture" means the Indenture, dated as
of December 15, 1993, between the Company and IBJ Schroder Bank
& Trust Company, pursuant to which the Company's Senior Notes
are issued.
"Senior Notes" means the Company's 8-3/4% Senior
Notes Due December 15, 2001 in the initial aggregate principal
amount of $125,000,000.
"Sequa Capital" means Sequa Capital Corporation, a
New York corporation.
<PAGE>
-17-
"Stated Maturity," when used with respect to any
security, means the date specified in such security as the
fixed date on which an amount equal to the principal of such
security is due and payable.
"Subordinated Debt" means any Indebtedness that is
subordinated or junior in right of payment to the Senior Notes.
"Subsidiary" means any corporation, association or
other business entity of which more than 50% of the total vot-
ing power of shares of Capital Stock entitled (without regard
to the occurrence of any contingency) to vote in the election
of directors, managers or trustees thereof is at the time owned
or controlled, directly or indirectly, by any person or one or
more of the other Subsidiaries of that person or a combination
thereof.
"TIA" means the Trust Indenture Act of 1939, as
amended, and as in effect on the date of this Indenture; pro-
vided, however, that in the event the TIA is amended after such
date, TIA means, to the extent required by any such amendment,
the TIA as so amended.
"Trustee" means the party named as the "Trustee" in
the first paragraph of this Indenture until a successor
replaces it pursuant to the applicable provisions of this
Indenture and, thereafter, shall mean such successor.
"Unrestricted Subsidiary" means (i) any Subsidiary
designated as such by resolution of the Board of Directors
where (x) neither the Company nor any of its other Restricted
Subsidiaries (a) provides credit support for, or guarantee of,
any Indebtedness of such Subsidiary or any Subsidiary of such
Subsidiary (including any undertaking, agreement or instrument
evidencing such Indebtedness) or (b) is directly or indirectly
liable for any Indebtedness of such Subsidiary or any Subsid-
iary of such Subsidiary, and (y) no default with respect to any
Indebtedness of such Subsidiary or any Subsidiary of such Sub-
sidiary (including any right which the holders thereof may have
to take enforcement action against such Subsidiary) would per-
mit (upon notice, lapse of time or both) any holder of any
Indebtedness of the Company and its Restricted Subsidiaries to
declare a default on such Indebtedness or cause the payment
thereof to be accelerated or payable prior to its final sched-
uled maturity and (ii) any Subsidiary of an Unrestricted Sub-
sidiary. The Board of Directors may designate any Restricted
Subsidiary to be an Unrestricted Subsidiary unless such
<PAGE>
-18-
Restricted Subsidiary owns any Capital Stock of, or owns or
holds any Lien on any property of, any other Subsidiary of the
Company which is not a Subsidiary of the Restricted Subsidiary
to be so designated or otherwise an Unrestricted Subsidiary;
provided, however, that either (i) the designation is made in
accordance with the provisions of Section 4.16(e) hereof, (ii)
the Restricted Subsidiary to be so designated has total assets
of $1,000 or less or (iii) immediately after giving effect to
such designation on a pro forma basis, the Company could incur
at least $1.00 of additional Indebtedness (other than Permitted
Indebtedness) pursuant to the provisions of Section 4.09
hereof; and provided, further, in the case only of clause
(iii), the Company could make a Restricted Payment in an amount
equal to the greater of the Fair Market Value and the book
value of such Subsidiary pursuant to the provisions of Section
4.08 hereof and such amount is thereafter treated as a
Restricted Payment for the purpose of calculating the aggregate
amount available for Restricted Payments thereunder.
"U.S. Government Obligations" means securities that
are (i) direct obligations of the United States of America for
the timely payment of which its full faith and credit is
pledged or (ii) obligations of a person controlled or super-
vised by and acting as an agency or instrumentality of the
United States of America the timely payment of which is uncon-
ditionally guaranteed as a full faith and credit obligation by
the United States of America which, in either case, are not
callable or redeemable at the option of the issuer thereof, and
shall also include a depository receipt issued by a bank (as
defined in Section 3(a)(2) of the Securities Act), as custodian
with respect to any such U.S. Government Obligation or a spe-
cific payment of principal of or interest on any such U.S.
Government Obligation held by such custodian for the account of
the holder of such depository receipt; provided, however, that
(except as required by law) such custodian is not authorized to
make any deduction from the amount payable to the holder of
such depository receipt from any amount received by the custo-
dian in respect of the U.S. Government Obligation or the spe-
cific payment of principal of or interest on the U.S. Govern-
ment Obligation evidenced by such depository receipt.
"Weighted Average Life to Maturity" means, when
applied to any Indebtedness at any date, the number of years
obtained by dividing (i) the then outstanding aggregate princi-
pal amount of such Indebtedness into (ii) the total of the
product obtained by multiplying (x) the amount of each then
remaining installment, sinking fund, serial maturity or other
<PAGE>
-19-
required payment of principal, including payment at final
maturity, in respect thereof, by (y) the number of years (cal-
culated to the nearest one-twelfth) which will elapse between
such date and the making of such payment.
"Wholly Owned Restricted Subsidiary" of any Person
means a Restricted Subsidiary of such Person all of the out-
standing Capital Stock or other ownership interests of which
(other than directors' qualifying shares) shall at the time be
owned by such Person or by one or more Wholly Owned Restricted
Subsidiaries of such Person or by such Person and one or more
Wholly Owned Restricted Subsidiaries of such Person.
SECTION 1.02. Other Definitions.
Defined in
Term Section
"Act".................................... 1.05
"Affiliate Transaction"................. 4.14
"Change of Control Notice"............... 4.15
"Change of Control Offer"................ 4.15
"Change of Control Payment Date"......... 4.15
"Change of Control Price" ............... 4.15
"Covenant Defeasance".................... 8.01
"Designated Senior Debt"................. 10.01
"Event of Default"....................... 6.01
"Investment Grade Ratings"............... 4.19
"Legal Defeasance"....................... 8.01
"Legal Holiday".......................... 11.08
"Notice of Default"...................... 6.01
"Paying Agent"........................... 2.03
"Proceeds Purchase Date"................. 4.16
"Rating Agencies"........................ 4.19
"Register"............................... 2.03
"Registrar".............................. 2.03
"Restricted Payment" .................... 4.08
"Securities Act"......................... 7.04
"Senior Debt"............................ 10.01
"Senior Subordinated Asset Sale Offer"... 4.16
"Senior Subordinated Excess Proceeds".... 4.16
"Suspended Covenants".................... 4.19
"Surviving Corporation".................. 5.01
"U.S. Government Obligations"............ 8.01
<PAGE>
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SECTION 1.03. Incorporation by Reference of Trust
Indenture Act. Whenever this Indenture refers to a provision
of the TIA, such provision is incorporated by reference in and
made a part of this Indenture. The following TIA terms used in
this Indenture have the following meanings:
"Commission" means the SEC.
"Indenture securities" means the Securities.
"Indenture security holder" means a Securityholder.
"Indenture to be qualified" means this Indenture.
"Indenture trustee" or "institutional trustee" means
the Trustee.
"Obligor" on the indenture securities means the Com-
pany and any other obligor upon the securities.
All other TIA terms used in this Indenture that are
defined by the TIA, defined by TIA reference to another statute
or defined by SEC rule have the meanings assigned to them by
such definitions.
SECTION 1.04. Rules of Construction. Unless the
context otherwise requires:
(1) A term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the
meaning assigned to it in accordance with GAAP;
(3) "or" is not exclusive;
(4) "including" means including, without limitation;
and
(5) words in the singular include the plural, and
words in the plural include the singular.
SECTION 1.05. Acts of Holders.
(a) Any request, demand, authorization, direction,
notice, consent, waiver or other action provided by this Inden-
ture to be given or taken by Holders may be embodied in and
evidenced by one or more instruments of substantially similar
<PAGE>
-21-
tenor signed by such Holders in person or by an agent duly
appointed in writing; and, except as herein otherwise expressly
provided, such action shall become effective when such instru-
ment or instruments are delivered to the Trustee and, where it
is hereby expressly required, to the Company. Such instrument
or instruments (and the action embodied therein and evidenced
thereby) are herein sometimes referred to as the "Act" of Hold-
ers signing such instrument or instruments. Proof of execution
of any such instrument or of a writing appointing any such
agent shall be sufficient for any purpose of this Indenture and
conclusive in favor of the Trustee and the Company, if made in
the manner provided in this Section.
(b) The fact and date of the execution by any Person
of any such instrument or writing may be proved in any manner
which the Trustee deems sufficient.
(c) The ownership of Securities shall be proved by
the Register of Securities maintained by the Registrar.
(d) Any request, demand, authorization, direction,
notice, consent, waiver or other Act of the Holder of any Secu-
rity shall bind every future Holder of the same Security and
the holder of every Security issued upon the registration of
transfer thereof or in exchange therefor or in lieu thereof in
respect of anything done, omitted or suffered to be done by the
Trustee or the Company in reliance thereon, whether or not
notation of such action is made upon such Security.
(e) If the Company or the Trustee, as the case may
be, shall solicit from the Holders any request, demand, autho-
rization, direction, notice, consent, waiver or other Act, the
Company or the Trustee, as the case may be, may, at its option
(and, in the case of the Company, by or pursuant to a resolu-
tion of its Board of Directors), fix in advance a record date
for the determination of Holders entitled to give such request,
demand, authorization, direction, notice, consent, waiver or
other Act, but neither the Company nor the Trustee shall have
any obligation to do so. If such a record date is fixed, such
request, demand, authorization, direction, notice, consent,
waiver or other Act may be given before or after such record
date, but only the Holders of record at the close of business
on such record date shall be deemed to be Holders for the pur-
poses of determining whether Holders of the requisite propor-
tion of outstanding securities have authorized or agreed or
consented to such request, demand, authorization, direction,
notice, consent, waiver or other Act, and for that purpose the
<PAGE>
-22-
outstanding securities shall be computed as of such record
date; provided that no such authorization, agreement or consent
by the Holders on such record date shall be deemed effective
unless it shall become effective pursuant to the provisions of
this Indenture not later than six months after the record date.
ARTICLE 2
THE SECURITIES
SECTION 2.01. Form and Dating. The Securities and
the Trustee's certificate of authentication thereon shall be
substantially in the Form of Exhibit A hereto. The Securities
may have notations, legends or endorsements required by law,
stock exchange rule or usage. The form of the Securities and
any notation, legend or endorsement shall be in a form accept-
able to the Company. Each Security shall be dated the date of
its authentication.
The terms and provisions contained in the Securities,
annexed hereto as Exhibit A, shall constitute, and are hereby
expressly made, a part of this Indenture. To the extent appli-
cable, the Company and the Trustee, by their execution and
delivery of this Indenture, expressly agree to such terms and
provisions and to be bound thereby.
SECTION 2.02. Execution and Authentication. The
Securities shall be executed on behalf of the Company by its
chairman of the board, its president or one of its vice presi-
dents, under its corporate seal reproduced thereon attested by
its secretary or one of its assistant secretaries. The signa-
ture of any such officer on the Securities may be manual or
facsimile.
Securities bearing the manual or facsimile signatures
of individuals who were at any time the proper Officers of the
Company shall bind the Company, notwithstanding that such indi-
viduals or any of them have ceased to hold such offices prior
to the authentication and delivery of such Securities or did
not hold such offices at the date of such Securities.
No Security shall be entitled to any benefit under
this Indenture or be valid or obligatory for any purpose unless
there appears on such Security a certificate of authentication
substantially in the form provided for in Exhibit A annexed
hereto duly executed by the Trustee by manual signature of an
Officer of the Trustee, and such certificate upon any Security
<PAGE>
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shall be conclusive evidence, and the only evidence, that such
Security has been duly authenticated and made available for
delivery hereunder.
The Trustee shall, upon a written order of the Com-
pany signed by two Officers, authenticate securities for origi-
nal issue up to an aggregate principal amount stated in para-
graph 4 of the Securities. The aggregate principal amount of
Securities outstanding at any one time may not exceed the
amount set forth herein except as provided in Section 2.07.
The Trustee shall act as the initial authenticating
agent. Thereafter, the Trustee may appoint an authenticating
agent reasonably acceptable to the Company to authenticate
Securities. An authenticating agent may authenticate Securi-
ties whenever the Trustee may do so. Each reference in this
Indenture to authentication by the Trustee includes authentica-
tion by such agent. An authenticating agent has the same
rights as a Paying Agent to deal with the Company or an Affili-
ate of the Company.
The Securities shall be issuable only in registered
form without coupons and only in denominations of $1,000 and
any integral multiple thereof.
SECTION 2.03. Registrar and Paying Agent. The Com-
pany shall maintain or cause to be maintained an office or
agency within or without the City of New York, State of New
York where Securities may be presented for registration of
transfer or for exchange ("Registrar"), an office or agency
where Securities may be presented or surrendered for purchase
or payment ("Paying Agent") and an office or agency where
notices and demands to or upon the Company in respect of the
Securities and this Indenture may be served. The Registrar
shall keep a register of the Securities and of their transfer
and exchange (the "Register"). The Company may have one or
more co-registrars and one or more additional paying agents.
The term Paying Agent includes any additional paying agent.
The Trustee shall not be responsible for the acts or omissions
of any Registrar or Paying Agent other than the Trustee.
The Company shall enter into an appropriate agency
agreement with any Registrar, Paying Agent or co-registrar (if
not the Trustee or the Company). The agreement shall implement
the provisions of this Indenture that relate to such agent.
The Company shall notify the Trustee of the name and address of
any such agent. If the Company fails to maintain a Registrar,
<PAGE>
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Paying Agent or agent for service of notices or demands, the
Trustee shall act as such and shall be entitled to appropriate
compensation therefor pursuant to Section 7.07 hereof. The
Company or any Subsidiary or an Affiliate of either of them may
act as Paying Agent, Registrar or co-registrar or agent for
service of notices and demands.
The Company initially appoints the Trustee as Regis-
trar and Paying Agent and agent for service of notices and
demands.
SECTION 2.04. Paying Agent to Hold Money in Trust.
Except as otherwise provided herein, prior to or on each due
date of the principal, premium, if any, and interest on any
Security, the Company (or any other obligor on the Securities)
shall deposit with the Paying Agent a sum of money sufficient
to pay such principal, premium, if any, and interest so becom-
ing due. The Company and any other obligor on the Securities
shall require each Paying Agent (other than the Trustee or the
Company) to agree in writing that such Paying Agent shall hold
in trust for the benefit of Securityholders or the Trustee all
money held by the Paying Agent for the payment of principal,
premium, if any, and interest on the Securities (whether such
money has been paid to it by the Company or any other obligor
on the Securities) and shall notify the Trustee of any default
by the Company or any other obligor on the Securities in making
any such payment. At any time during the continuance of any
such default, the Paying Agent shall, upon the request of the
Trustee, forthwith pay to the Trustee all money so held in
trust and account for any money disbursed by it. The Company
and any other obligor on the Securities at any time may require
a Paying Agent to pay all money held by it to the Trustee and
to account for any money disbursed by it. Upon doing so, the
Paying Agent shall have no further liability for the money so
paid over to the Trustee. If the Company, a Subsidiary or an
Affiliate of any of them acts as Paying Agent, it shall segre-
gate the money held by it as Paying Agent and hold it as a
separate trust fund.
SECTION 2.05. Securityholder Lists. The Trustee
shall preserve in as current a form as is reasonably practi-
cable, the most recent list available to it of the names and
addresses of Securityholders. If the Trustee is not the Regis-
trar, the Company or any other obligor upon the Securities
shall cause to be furnished to the Trustee at least 15 days
before each interest payment date and at such other times as
the Trustee may request in writing, within 10 days of such
<PAGE>
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request, a list, in such form as the Trustee may reasonably
require, of the names and addresses of Securityholders.
SECTION 2.06. Transfer and Exchange. Upon surrender
for registration of transfer of any Security at the office or
agency of the Company designated as Registrar or co-registrar
pursuant to Section 2.03, the Company shall execute, and the
Trustee shall authenticate and make available for delivery, in
the name of the designated transferee or transferees, one or
more new Securities of any authorized denomination or denomina-
tions, of a like aggregate principal amount.
At the option of the Holder, Securities may be
exchanged for other Securities of any authorized denomination
or denominations, of a like aggregate principal amount, upon
surrender of the Securities to be exchanged at such office or
agency. Whenever any Securities are so surrendered for
exchange, the Company shall execute, and the Trustee shall
authenticate and make available for delivery, the Securities
which the Holder making the exchange is entitled to receive.
Every Security presented or surrendered for registra-
tion of transfer or for exchange shall be duly endorsed, or be
accompanied by a written instrument of transfer in form satis-
factory to the Company and the Registrar duly executed by the
Holder or his attorney or legal representative duly authorized
in writing. Any transfer or exchange shall be without charge
to the Holders, except the Company may require payment of a sum
sufficient to pay all taxes, assessments or other governmental
charges that may be imposed in connection with such transfer or
exchange from the Securityholder requesting such transfer or
exchange (other than any exchange of a temporary Security for a
definitive Security not involving any change in ownership).
The Company or the Registrar, as the case may be,
shall not be required (i) to issue, register the transfer of or
exchange the Securities during a period beginning at the open-
ing of business 15 days before the day of any selection of
Securities for redemption under Section 3.02 and ending at the
close of business on the day of the selection, or (ii) to reg-
ister the transfer or exchange of any Securities so selected
for redemption (except, in the case of Securities to be
redeemed in part, the portion thereof not to be redeemed).
SECTION 2.07. Replacement Securities. If (a) any
mutilated Security is surrendered to the Company or the Trus-
tee, or (b) the Company and the Trustee receive evidence to
<PAGE>
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their satisfaction of the destruction, loss or theft of any
Security, and there is delivered to the Company and the Trustee
such security or indemnity as may be required by them to save
each of them harmless, then, in the absence of notice to the
Company or the Trustee that such Security has been acquired by
a bona fide purchaser, the Company shall execute, and upon the
Company's written request, the Trustee shall authenticate and
make available for delivery, in exchange for any such mutilated
Security or in lieu of any such destroyed, lost or stolen Secu-
rity, a new Security of like tenor and principal amount, bear-
ing a number not contemporaneously outstanding.
In case any such mutilated, destroyed, lost or stolen
Security has become or is about to become due and payable, or
is about to be redeemed by the Company pursuant to Article 3
hereof, the Company in its discretion may, instead of issuing a
new Security, pay or purchase such Security, as the case may
be, except in the case of any Securities to be redeemed in
part, the portion thereof not to be redeemed.
Upon the issuance of any new Securities under this
Section 2.07, the Company may require the payment of a sum suf-
ficient to cover any tax or other governmental charge that may
be imposed in relation thereto and any other expenses (includ-
ing the fees and expenses of the Trustee) in connection
therewith.
Every new Security issued pursuant to this Section
2.07 in lieu of any mutilated, destroyed, lost or stolen Secu-
rity shall constitute an original additional contractual obli-
gation of the Company whether or not the mutilated, destroyed,
lost or stolen Security shall be at any time enforceable by
anyone, and shall be entitled to all benefits of this Indenture
equally and proportionately with any and all other Securities
duly issued hereunder.
The provisions of this Section 2.07 are exclusive and
shall preclude (to the extent lawful) all other rights and
remedies with respect to the replacement or payment of muti-
lated, destroyed, lost or stolen Securities.
SECTION 2.08. Outstanding Securities; Determinations
of Holders' Action. Securities outstanding at any time are all
the Securities authenticated by the Trustee except for those
canceled by it, those delivered to it for cancellation, those
referred to in Section 2.07 hereof, or purchased by the Company
pursuant to Article 3 hereof and those described in this
<PAGE>
-27-
Section 2.08 as not outstanding. A Security does not cease to
be outstanding because the Company or an Affiliate thereof
holds the Security; provided, however, that in determining
whether the Holders of the requisite principal amount of Secu-
rities have given or concurred in any request, demand, authori-
zation, direction, notice, consent or waiver hereunder, Securi-
ties owned by the Company, any other obligor upon the Securi-
ties or any Affiliate of the Company or such other obligor
shall be disregarded and deemed not to be outstanding, except
that, in determining whether the Trustee shall be protected in
relying upon any such request, demand, authorization, direc-
tion, notice, consent or waiver, only Securities the ownership
of which by the Company or an Affiliate of the Company the
Trustee has actual written knowledge of shall be so disre-
garded. Subject to the foregoing, only Securities outstanding
at the time of such determination shall be considered in any
such determination (including determinations pursuant to Arti-
cles 6 and 9).
If a Security is replaced pursuant to Section 2.07,
it ceases to be outstanding unless the Trustee receives proof
satisfactory to it that the replaced Security is held by a bona
fide purchaser.
If the Paying Agent (other than the Company) holds,
in accordance with this Indenture, at maturity or on a redemp-
tion date, money sufficient to pay the Securities payable on
that date, then immediately on the date of maturity or such
redemption date, as the case may be, such Securities shall
cease to be outstanding and interest, if any, on such Securi-
ties shall cease to accrue.
SECTION 2.09. Temporary Securities. Pending the
preparation of definitive Securities, the Company may execute,
and upon written request from the Company signed by two Offic-
ers of the Company, the Trustee shall authenticate and make
available for delivery, temporary Securities which are printed,
lithographed, typewritten, mimeographed or otherwise produced,
in any authorized denomination, substantially of the tenor of
the definitive Securities in lieu of which they are issued and
with such appropriate insertions, omissions, substitutions and
other variations as the Officers of the Company executing such
Securities may determine, as conclusively evidenced by their
execution of such Securities.
If temporary Securities are issued, the Company will
cause definitive Securities to be prepared without unreasonable
<PAGE>
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delay and exchange the temporary securities for definitive
Securities upon surrender of the temporary Securities at the
office or agency of the Company designated for such purpose
pursuant to Section 2.03 hereof, without charge to the Holder.
Until so exchanged, the temporary Securities shall in all
respects be entitled to the same benefits under this Indenture
as definitive Securities.
SECTION 2.10. Cancellation. The Company may at any
time deliver to the Trustee for cancellation any Securities
previously authenticated and made available for delivery here-
under which the Company may have acquired in any manner whatso-
ever, and all Securities so delivered shall be promptly can-
celed by the Trustee. The Company may not reissue, or issue
new Securities to replace Securities it has paid or delivered
to the Trustee for cancellation. No Securities shall be
authenticated in lieu of or in exchange for any Securities can-
celed as provided in this Section 2.10, except as expressly
permitted by this Indenture. All canceled Securities held by
the Trustee shall be destroyed by the Trustee, provided that
all regulatory requirements relating to the destruction of cer-
tificates are complied with, and a certificate of destruction
is delivered to the Company.
SECTION 2.11. CUSIP Numbers. The Company in issuing
the Securities may use "CUSIP" numbers (if then generally in
use), and the Trustee shall use CUSIP numbers in notices of
redemption or exchange as a convenience to Holders; provided
that any such notice shall state that no representation is made
as to the correctness of such numbers either as printed on the
Securities or as contained in any notice of redemption or
exchange and that reliance may be placed only on the other
identification numbers printed on the Securities and any
redemption shall not be affected by any defect in or omission
of such numbers.
SECTION 2.12. Defaulted Interest. If the Company
defaults in a payment of interest on the Securities, it shall
pay the defaulted interest, plus (to the extent lawful) any
interest payable on the defaulted interest, to the Persons who
are Holders on a subsequent special record date which shall be
not less than five Business Days prior to the date of payment
of such defaulted interest. The subsequent special record date
and payment date shall be determined by the Trustee. At least
15 days before the subsequent special record date, the Trustee
shall mail to each Holder a notice that states the subsequent
special record date, the payment date and the amount of
<PAGE>
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defaulted interest to be paid. The Company may also pay
defaulted interest in any other lawful manner.
ARTICLE 3
REDEMPTION
SECTION 3.01. Right to Redeem; Notices to Trustee.
At any time on and after December 15, 1998, the Company, at its
option, may redeem the Securities in whole or in part in accor-
dance with this Article 3 and the provisions of the first para-
graph of paragraph 5 of the Securities. If the Company elects
to redeem Securities pursuant to paragraph 5 of the Securities,
it shall notify the Trustee in writing of the Redemption Date,
the principal amount of Securities to be redeemed, the Redemp-
tion Price and, in the case of a redemption pursuant to Section
3.02 hereof, the date of the Public Equity Offering.
The Company shall give the notice to the Trustee pro-
vided for in this Section 3.01 at least 45 days before the
Redemption Date (unless a shorter notice shall be satisfactory
to the Trustee in its sole discretion).
SECTION 3.02. Public Equity Offering Redemption. In
addition to the optional redemption of the Securities provided
for in the first paragraph of paragraph 5 of the Securities, on
or prior to December 15, 1996, the Company may redeem up to 35%
of the principal amount of the Securities originally issued
under this Indenture with the net proceeds of a Public Equity
Offering at a redemption price equal to 109.375% of the princi-
pal amount thereof, plus accrued and unpaid interest, if any,
to the Redemption Date; provided, however, that at least 65% of
the principal amount of Securities originally issued under this
Indenture remains outstanding immediately after the occurrence
of such redemption; provided, further, that such redemption
shall occur within 45 days after the date of the closing of the
Public Equity Offering; and provided, further, that the Trustee
shall receive notice of such redemption at least 15 days before
notices are to be mailed.
SECTION 3.03. Mandatory Redemption. Subject to the
Company's obligation to make an offer to repurchase the Securi-
ties pursuant to Sections 4.15 and 4.16 hereof, the Company
shall have no mandatory redemption or sinking fund obligations
with respect to the Securities.
<PAGE>
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SECTION 3.04. Selection of Securities to Be
Redeemed. If less than all the outstanding Securities are to
be redeemed at any time, the Trustee shall select the Securi-
ties to be redeemed in compliance with the requirements of the
principal national securities exchange, if any, on which the
Securities are listed, or, if the Securities are not so listed,
by lot; provided that no such Securities in principal amounts
of $1,000 or less shall be redeemed in part. The Trustee shall
make the selection at least 40 days but not more than 60 days
before the Redemption Date from outstanding Securities not pre-
viously called for redemption. Securities and portions of them
the Trustee selects shall be in principal amounts of $1,000 or
an integral multiple of $1,000. Provisions of this Indenture
that apply to Securities called for redemption also apply to
portions of Securities called for redemption. The Trustee
shall notify the Company promptly of the Securities or portions
of Securities to be redeemed.
SECTION 3.05. Notice of Redemption. At least 30
days but not more than 60 days before a Redemption Date, the
Company shall mail or cause to be mailed a notice of redemption
by first-class mail, postage prepaid, to each Securityholder at
the Securityholder's last address, as it shall appear on the
Register. A copy of such notice shall be mailed to the Trustee
on the same day the notice is mailed to the Securityholders.
The notice shall identify the Securities to be
redeemed and shall state:
(1) the Redemption Date;
(2) the Redemption Price and the amount of accrued
interest to be paid, if any;
(3) the CUSIP number (subject to the provisions of
Section 2.11 hereof);
(4) the name and address of the Paying Agent;
(5) that Securities called for redemption must be
surrendered to the Paying Agent to collect the Redemption Price
and the amount of accrued interest to be paid, if any;
(6) if fewer than all the outstanding Securities are
to be redeemed, the identification and principal amounts of the
particular Securities to be redeemed, and that upon surrender
<PAGE>
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of such Security, a new Security in a principal amount equal to
the unredeemed portion thereof will be issued; and
(7) that, unless the Company defaults in making such
redemption payment, interest will cease to accrue on Securities
called for redemption on and after the Redemption Date; and
(8) in the case of a redemption pursuant to Section
3.02 hereof, the date of the closing of the Public Equity
Offering.
At the Company's written request, which request shall
be received by the Trustee at least 45 days before the Redemp-
tion Date (unless a shorter notice shall be satisfactory to the
Trustee in its sole discretion), the Trustee shall give the
notice of redemption in the Company's name and at the Company's
expense; provided, however, that in all cases the text of such
notice of redemption shall be prepared or approved by the Com-
pany and the Trustee shall have no responsibility whatsoever
with regard to such notice being accurate or correct.
SECTION 3.06. Effect of Notice of Redemption. Once
notice of redemption is given, Securities called for redemption
become due and payable on the Redemption Date and at the
Redemption Price. Upon the later of the Redemption Date and
the date such Securities are surrendered to the Paying Agent,
such Securities called for redemption shall be paid at the
Redemption Price plus accrued interest, if any, to the Redemp-
tion Date.
Notice of redemption shall be deemed to be given when
mailed, whether or not the Holder receives the notice. In any
event, failure to give such notice, or any defect therein,
shall not affect the validity of the proceedings for the
redemption of the Securities.
SECTION 3.07. Deposit of Redemption Price. Prior to
or on the Redemption Date, the Company shall deposit in immedi-
ately available funds with the Paying Agent (or if the Company
or a Subsidiary or an Affiliate of either of them is the Paying
Agent, shall segregate and hold in trust) money sufficient to
pay the Redemption Price of all Securities to be redeemed on
that date other than Securities or portions of Securities
called for redemption which prior thereto have been delivered
by the Company to the Trustee for cancellation.
<PAGE>
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SECTION 3.08. Securities Redeemed in Part. Upon
surrender of a Security that is redeemed in part, the Company
shall execute, and the Trustee shall authenticate and make
available for delivery to the Holder, a new Security in an
authorized denomination equal in principal amount to the
unredeemed portion of the Security surrendered.
ARTICLE 4
COVENANTS
SECTION 4.01. Payment of Securities. The Company
shall pay the principal of, premium, if any, and interest
(including interest accruing on or after the filing of a peti-
tion in bankruptcy or reorganization relating to the Company,
whether or not a claim for post-filing interest is allowed in
such proceeding) on the Securities on (or prior to) the dates
and in the manner provided in the Securities or pursuant to
this Indenture. An installment of principal, premium, if any,
or interest shall be considered paid on the applicable date due
if on such date the Trustee or the Paying Agent holds, in
accordance with this Indenture, money sufficient to pay all of
such installment then due. The Company shall pay interest on
overdue principal and premium, if any, and interest on overdue
installments of interest (including interest accruing on or
after the filing of a petition in bankruptcy or reorganization
relating to the Company whether or not a claim for post-filing
interest is allowed in such proceeding), to the extent lawful,
at the rate per annum borne by the Securities, which interest
on overdue interest shall accrue from the date such amounts
became overdue.
SECTION 4.02. [Intentionally Omitted]
SECTION 4.03. SEC Reports. The Company shall
deliver to the Trustee and to each Holder, within 15 days after
it files the same with the SEC, copies of its annual and quar-
terly reports, information, documents and other reports (or
copies of such portions of any of the foregoing as the SEC may
by rules and regulations prescribe) which the Company is
required to file with the SEC pursuant to Section 13 or 15(d)
of the Exchange Act. In the event that the Company is at any
time not subject to the reporting requirements of the Exchange
Act, it shall provide to the Trustee and shall deliver to each
Holder, within 15 days after it would have been required to
file such information with the SEC had it continued to be sub-
ject to the reporting requirement of the Exchange Act,
<PAGE>
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financial statements and any notes thereto (and, with respect
to annual reports, an auditors' report by an accounting firm of
established national reputation) and a "Management's Discussion
and Analysis of Financial Condition and Results of Operations,"
comparable to that which the Company would have been required
to file if it were subject to the requirements of such Section
13 or 15(d) of the Exchange Act. The Company shall also comply
with the other provisions of TIA Section 314(a).
SECTION 4.04. Compliance Certificates.
(a) The Company shall deliver to the Trustee,
within 90 days after the end of each fiscal year and within 60
days after the end of each fiscal quarter of the Company, an
Officers' Certificate stating that a review of the activities
of the Company and its Subsidiaries during the preceding fiscal
period has been made under the supervision of the signing
officers with a view to determining whether the Company has
kept, observed, performed and fulfilled its obligations under
this Indenture, and further stating, as to each such Officer
signing such certificate, that to the best of his knowledge the
Company has kept, observed, performed and fulfilled each and
every covenant contained in this Indenture and is not in
default in the performance or observance of any of the terms,
provisions and conditions hereof (or, if a Default or Event of
Default shall have occurred, describing all such Defaults or
Events of Default of which he may have knowledge) and that to
the best of his knowledge no event has occurred and remains in
existence by reason of which payments on account of the princi-
pal of or interest, if any, on the Securities are prohibited or
if such event has occurred, a description of the event.
(b) So long as not contrary to the then current rec-
ommendations of the American Institute of Certified Public
Accountants as reported to the Trustee in a letter from the
Company's independent public accountants, the annual financial
statements delivered pursuant to Section 4.03 shall be accompa-
nied by a written statement of the Company's independent public
accountants (which shall be a firm of established national rep-
utation) that in making the examination necessary for certifi-
cation of such financial statements, nothing has come to their
attention which would lead them to believe that the Company has
violated any provisions of Article 4 or 5 of this Indenture or,
if any such violation has occurred, specifying the nature and
period of existence thereof.
<PAGE>
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(c) The Company and any other obligor upon the Secu-
rities will, so long as any of the Securities are outstanding,
deliver to the Trustee, forthwith upon becoming aware of (i)
any Default, Event of Default or default in the performance of
any covenant, agreement or condition contained in this Inden-
ture or (ii) any event of default under any other mortgage,
indenture or instrument as such terms are used in Section
6.01(4), an Officers' Certificate specifying such Default,
Event of Default or default.
SECTION 4.05. Payment of Taxes and Other Claims.
The Company shall pay or discharge or cause to be paid or dis-
charged, before any penalty accrues thereon, (i) all material
taxes, assessments and governmental charges levied or imposed
upon the Company or any Subsidiary upon the income, profits or
property of the Company or any Subsidiary, and (ii) all mate-
rial lawful claims for labor, materials and supplies which, if
unpaid, would by law become a Lien upon the property of the
Company or any Subsidiary; provided that none of the Company or
any Subsidiary shall be required to pay or discharge or cause
to be paid or discharged any such tax, assessment, charge or
claims the amount, applicability or validity of which is being
contested in good faith by appropriate proceedings and for
which adequate provision has been made or where the failure to
effect such payment or discharge is not adverse in any material
respect to the Holders.
SECTION 4.06. Waiver of Stay, Extension or Usury
Laws. The Company covenants (to the extent that it may law-
fully do so) that it will not at any time insist upon, or
plead, or in any manner whatsoever claim or take the benefit or
advantage of, any stay or extension law or any usury or other
law wherever enacted, now or at any time hereafter in force,
that would prohibit or forgive the Company from paying all or
any portion of the principal or premium, if any, or interest on
the Securities as contemplated herein or affect the covenants
or the performance by the Company of its obligations under this
Indenture; and the Company (to the extent that it may lawfully
do so) hereby expressly waives all benefit or advantage of any
such law, and covenants that it will not hinder, delay or
impede the execution of any power herein granted to the Trus-
tee, but will suffer and permit the execution of every such
power as though no such law had been enacted.
SECTION 4.07. Corporate Existence. Subject to
Article 5 hereof, the Company will, and will cause each of its
Subsidiaries to, do or cause to be done all things reasonably
<PAGE>
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necessary to preserve and keep in full force and effect their
respective corporate existence in accordance with the respec-
tive organizational documents and the rights (charter and
statutory), licenses and franchises of the Company and its Sub-
sidiaries; provided, however, that neither the Company nor any
such Subsidiary shall be required to preserve any such right,
license or franchise, if the Board of Directors of the Company
shall determine that the preservation thereof is no longer
desirable or necessary in the conduct of the business of the
Company and its Subsidiaries taken as a whole, and that the
loss thereof is not adverse in any material respect to the
Holders.
SECTION 4.08. Limitation on Restricted Payments.
The Company will not, and will not permit any of its Restricted
Subsidiaries to, directly or indirectly: (i) declare or pay
any dividend or make any distribution on account of the Compa-
ny's or such Restricted Subsidiary's Equity Interests (other
than dividends or distributions payable in Equity Interests
(other than Disqualified Stock) of the Company or such
Restricted Subsidiary or dividends or distributions payable to
the Company or any Wholly Owned Restricted Subsidiary of the
Company; (ii) purchase, redeem or otherwise acquire or retire
for value any Equity Interests of the Company, or any Subsid-
iary or other Affiliate of the Company (other than any such
Equity Interests owned by the Company or any Wholly Owned
Restricted Subsidiary of the Company and other than as
described in clauses (iii) and (iv) of the definition of "Per-
mitted Investments"); (iii) make any principal payment on, pur-
chase, redeem, retire, defease, prepay, decrease or otherwise
acquire or retire for value prior to a scheduled final matur-
ity, scheduled repayment or scheduled mandatory sinking fund
payment date or maturity date (A) any Indebtedness of the Com-
pany that is subordinated or junior in right of payment to the
Securities or (B) any Indebtedness of the Company's Unre-
stricted Subsidiaries; or (iv) make any Restricted Investment
(all such payments and other actions set forth in clauses (i)
through (iv) above being collectively referred to as
"Restricted Payments"), unless, at the time of such Restricted
Payment:
(a) no Default or Event of Default shall have
occurred and be continuing or would occur as a consequence
thereof; and
(b) the Company would, at the time of such
Restricted Payment and after giving pro forma effect
<PAGE>
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thereto as if such Restricted Payment had been made at the
beginning of the applicable Four Quarter Period, have been
permitted to incur at least $1.00 of additional Indebted-
ness (other than Permitted Indebtedness) pursuant to the
provisions of Section 4.09; and
(c) such Restricted Payment, together with the
aggregate of all other Restricted Payments made by the
Company and its Restricted Subsidiaries from December 22,
1993, is less than the sum of (x) $50 million plus 50% of
cumulative Consolidated Net Income of the Company for the
period (taken as one accounting period) from January 1,
1994 (or, if such Consolidated Net Income for such period
is a deficit, minus 100% of such deficit) plus (y) 100% of
the aggregate net cash proceeds received by the Company
from any Person (other than a Subsidiary of the Company),
from the issue or sale of Equity Interests (other than
Disqualified Stock) of the Company and the principal
amount of debt securities of the Company that have been
converted into Equity Interests (other than Disqualified
Stock) of the Company (other than by a Subsidiary of the
Company) subsequent to January 1, 1994.
The foregoing provisions will not prohibit: (i) the
payment of any dividend or making of any distribution within 60
days after the date of declaration thereof, if at the date of
declaration such dividend or distribution would have complied
with the provisions of this Indenture; (ii) the redemption,
retirement or repurchase of Indebtedness of the Company and its
Subsidiaries with the proceeds of the offering of the Securi-
ties; (iii) the redemption, retirement or repurchase of the
Company's 10>% Senior Subordinated Notes due 1998 in compliance
with the provisions of Section 4.16 hereof; (iv) the purchase
for value of shares of Capital Stock or warrants, options or
other rights to acquire Capital Stock held by directors, offic-
ers or employees of the Company or a Restricted Subsidiary upon
death, disability, retirement or termination of employment in
an aggregate amount not to exceed $500,000 in any twelve-month
period; or (v) the repurchase of the ARC Minority Interest for
aggregate consideration not to exceed $20 million; provided,
however, that in the case of clauses (ii), (iii), (iv) and (v),
no Default or Event of Default shall have occurred or be con-
tinuing at the time of such payment or as a result thereof.
SECTION 4.09. Limitation on Additional Indebtedness.
The Company will not, directly or indirectly, create, incur,
issue, assume, guaranty or otherwise become directly or
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indirectly liable, contingently or otherwise, or otherwise
become responsible for (collectively, "incur"), any Indebted-
ness (including Acquired Debt), other than Permitted Indebted-
ness and the Company will not issue any Disqualified Stock;
provided, however, that the Company may incur Indebtedness or
issue shares of Disqualified Stock if the Consolidated Interest
Coverage Ratio of the Company for the applicable Four Quarter
Period would have been at least 2.0 to 1.0 after giving pro
forma effect to such incurrence or issuance as if it had
occurred at the beginning of such Four Quarter Period.
SECTION 4.10. Limitation on Indebtedness and Dis-
qualified Stock of Restricted Subsidiaries. The Company will
not cause or permit any Restricted Subsidiary of the Company to
incur any Indebtedness or issue any shares of Capital Stock, or
securities convertible or exchangeable into, or options, war-
rants, rights or any other interests with respect to, Capital
Stock, except for: (i) Indebtedness owed by a Restricted Sub-
sidiary of the Company to the Company or another Wholly Owned
Restricted Subsidiary of the Company (provided that such
Indebtedness is at all times held by the Company or a Wholly
Owned Restricted Subsidiary of the Company); (ii) Acquired Debt
of a Restricted Subsidiary existing at the time of the acquisi-
tion of such Restricted Subsidiary by the Company or any
Restricted Subsidiary; provided, however, that (x) such Indebt-
edness shall not have been created in contemplation of such
acquisition and (y) after giving pro forma effect to such
acquisition as if it had occurred at the beginning of the
applicable Four Quarter Period, the Company could incur $1.00
of additional Indebtedness (other than Permitted Indebtedness)
pursuant to the provisions of Section 4.09 hereof; (iii) guar-
antees of the Obligations of the Company under the New Credit
Facility; (iv) Existing Indebtedness of the Restricted Subsid-
iaries and Refinancing Indebtedness with respect thereto that
satisfies the requirements of clause (v) of the definition of
Permitted Indebtedness; (v) Indebtedness of Sequa Capital
secured by a pledge of the capital stock of Sequa Capital; pro-
vided, however, such Indebtedness also is non-recourse to Sequa
Capital and the Company and its Restricted Subsidiaries (sub-
ject to the right of a lender to be indemnified for breaches of
representations or warranties); (vi) intercompany Indebtedness
arising in the ordinary course of business of ARC owing to the
Company; (vii) Indebtedness incurred by Foreign Restricted Sub-
sidiaries in an amount not to exceed $75 million at any one
time outstanding, provided that after giving pro forma effect
to the incurrence of such Indebtedness as if it had occurred at
the beginning of the applicable Four Quarter Period, (x) the
<PAGE>
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Company could incur $1.00 of additional Indebtedness (other
than Permitted Indebtedness) pursuant to the provisions of Sec-
tion 4.09 hereof or (y) such Indebtedness, if it had been
incurred directly by the Company, could have been incurred pur-
suant to clause (ii) of the definition of Permitted Indebted-
ness or (viii) the incurrence by a Restricted Subsidiary of
Hedging Obligations with respect to Indebtedness permitted to
be incurred by this Indenture.
SECTION 4.11. Limitation on Liens. The Company will
not, and will not permit any of its Restricted Subsidiaries to,
directly or indirectly, create, incur, assume or suffer to
exist any Lien (other than a Permitted Lien and Liens arising
in connection with sale and leaseback transactions permitted by
Section 4.13 hereof) on any asset now owned or hereafter
acquired, or on any income or profits earned therefrom or
assign or convey any right to receive income or profits there-
from, to secure obligations which are pari passu with, or sub-
ordinate or junior in right of payment to, the Securities with-
out making effective provision for securing the Securities (i)
equally and ratably with the obligations so secured as to such
assets or income or profits for so long as such obligations
will be so secured or (ii) in the event such obligations are
subordinate or junior in right of payment to the Securities,
prior to such obligations as to such assets or income or prof-
its for so long as such obligations will be so secured.
SECTION 4.12. Limitation On Dividend and Other Pay-
ment Restrictions Affecting Restricted Subsidiaries. The Com-
pany will not, and will not permit any of its Restricted Sub-
sidiaries to, directly or indirectly, create or otherwise cause
or suffer to exist or become effective any encumbrance or
restriction of any kind on the ability of any Restricted Sub-
sidiary to: (i) pay dividends or make any other distributions
to the Company or any of its Restricted Subsidiaries (x) on its
Capital Stock or (y) with respect to any other interest or par-
ticipation in, or measured by, its profits; (ii) pay any
Indebtedness or other obligations owed to the Company or any of
its Restricted Subsidiaries; (iii) make loans or advances to
the Company or any of its Restricted Subsidiaries; or (iv)
transfer any of its properties or assets to the Company or any
of its Restricted Subsidiaries, except for such encumbrances or
restrictions existing under or by reasons of (A) applicable
law; (B) Existing Indebtedness of Restricted Subsidiaries of
the Company and Refinancing Indebtedness with respect thereto
that satisfies the requirements of clause (v) of the definition
of "Permitted Indebtedness"; provided, however, that the
<PAGE>
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provisions contained in any modified or amended agreement
relating to such Refinancing Indebtedness are no more restric-
tive in any material respect than the provisions contained in
such agreement on the date of this Indenture; (C) the ARC Stock
Purchase and Restriction Agreement as in effect on the date of
this Indenture, or as it may be modified or amended subsequent,
to the date of this Indenture; provided, however, that the pro-
visions contained in such modified or amended agreement relat-
ing to such encumbrance or restriction are no more restrictive
in any material respect than the provisions contained in such
agreement on the date of this Indenture; (D) the Receivables
Agreement; provided, however, that the provisions contained in
any modified or amended agreement relating to such encumbrance
or restriction are no more restrictive in any material respect
than the provisions contained in such agreement on the date of
this Indenture; (E) the agreement under which the Indebtedness
referred to in clause (v) under Section 4.10 hereof is
incurred, including any successor agreement and any agreement
evidencing the refinancing, modification, replacement, renewal,
restatement, refunding, deferral, extension, substitution, sup-
plement, reissuance or resale thereof; provided, however, that
the provisions contained in any such agreement are no more
restrictive in any material respect than the provisions con-
tained in the agreement in effect on the date of this Inden-
ture; or (F) by reason of customary non-assignment provisions
in leases entered into in the ordinary course of business and
consistent with past practices.
SECTION 4.13. Limitation on Sale and Leaseback
Transactions. The Company will not, and will not permit any of
its Restricted Subsidiaries to, enter into any arrangement with
any Person providing for leasing by the Company or any of its
Restricted Subsidiaries of any real property or tangible per-
sonal property, which property has been or is to be sold or
transferred by the Company or any of its Restricted Subsidiar-
ies to such Person in contemplation of such leasing; provided,
however, the Company may enter into any such arrangement if (i)
the Company is permitted to dispose of such asset in compliance
with the provisions of Section 4.16 hereof, (ii) the Net Pro-
ceeds of any such sale or transfer are at least equal to the
Fair Market Value of such property, and (iii) (x) the Company
would be entitled, under the provisions of Sections 4.09 and
4.11 hereof, to incur secured Indebtedness in an amount equal
to the Attributable Indebtedness with respect to such arrange-
ment or (y) the Company applies the Net Proceeds of such sale
as provided under Section 4.16 hereof.
<PAGE>
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SECTION 4.14. Limitation on Transactions with Affil-
iates. The Company will not, and will not permit any of its
Restricted Subsidiaries to, sell, lease, transfer or otherwise
dispose of any of its properties or assets to, or purchase any
property or assets from, or enter into any transaction, con-
tract, agreement, understanding, loan, advance or guarantee
with, or for the benefit of, any Affiliate (each of the fore-
going, an "Affiliate Transaction"), unless (i) such Affiliate
Transaction is on terms that are no less favorable to the Com-
pany or Restricted Subsidiary than those that would have been
obtained on an arms-length basis in a comparable transaction by
the Company or Restricted Subsidiary with an unrelated person
and (ii) prior to the consummation of any such Affiliate Trans-
action, the Company delivers to the Trustee (x) with respect to
any Affiliate Transaction or series of related Affiliate Trans-
actions involving aggregate payments in excess of $1.0 million,
a resolution of the disinterested members of the Board of
Directors set forth in an Officers' Certificate certifying that
such Affiliate Transaction complies with clause (i) above and
that such Affiliate Transaction was approved by a majority of
the disinterested members of the Board of Directors and (y)
with respect to any Affiliate Transaction involving aggregate
payments in excess of $10.0 million, in addition to the
requirements specified in clause (x), a written opinion as to
the fairness of such Affiliate Transaction to the Company or
such Restricted Subsidiary from a financial point of view
issued by an investment banking firm of national standing or in
the case of a transaction involving the sale or transfer of
assets subject to valuation, such as real estate, a written
appraisal by a nationally recognized appraisal firm; provided,
however, that the following shall not be deemed to be Affiliate
Transactions: (i) any employment agreement entered into by the
Company or any of its Restricted Subsidiaries in the ordinary
course of business and consistent with the past practice of the
Company or such Restricted Subsidiary, (ii) transactions per-
mitted by Section 4.08 hereof, and (iii) transactions between
or among the Company and its Wholly Owned Restricted
Subsidiaries.
SECTION 4.15. Repurchase Upon Change of Control.
(a) In the event of any Change of Control, the Com-
pany will be required to commence a Change of Control Offer (as
defined below) to purchase first all outstanding Senior Notes
and then all outstanding Securities on the date (the "Change of
Control Payment Date") which shall be no earlier than 30 days
nor later than 40 days from the date the Change of Control
<PAGE>
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Notice (as defined below) is mailed (or such later date as is
required by applicable law) at a purchase price equal to 101%
of the aggregate principal amount thereof, plus accrued and
unpaid interest, if any, to the Change of Control Payment Date
(the "Change of Control Price").
(b) Within 30 days following the occurrence of a
Change of Control, the Company or, at the written request and
expense of the Company (which request shall be received by the
Trustee no more than 15 days following the occurrence of such
Change of Control, unless a shorter notice shall be satisfac-
tory to the Trustee in its sole discretion), the Trustee shall
send, by first-class mail, postage prepaid, to each Holder a
notice of the occurrence of such Change of Control (the "Change
of Control Notice"), specifying a date by which a Holder must
notify the Company of such Holder's intention to exercise the
repurchase right and describing the procedure that such Holder
must follow to exercise such right; provided, however, that the
text of any such Change of Control Notice requested to be
delivered by the Trustee shall, at the sole discretion of the
Trustee and within five Business Days of the request by the
Trustee, be prepared or approved by the Company and the Trustee
shall have no responsibility whatsoever with regard to such
notice being accurate or correct. The Company shall, within
the same 30-day period, deliver a copy of such notice to the
Trustee and cause a copy of such notice to be published in a
daily newspaper of national circulation.
Each Change of Control Notice shall state:
(1) that an offer to purchase the Securities is
being made pursuant to this Section 4.15 (the "Change of Con-
trol Offer") and that all Securities tendered will be accepted
for payment;
(2) the Change of Control Price and the Change of
Control Payment Date, which shall be no earlier than 30 days
nor later than 40 days from the date the Change of Control
Notice is mailed; provided, however, that the Change of Control
Payment Date for the Securities shall be subsequent to such
date for the Senior Notes;
(3) that any Security not tendered will continue to
accrue interest;
(4) that, unless the Company defaults in the payment
of the Change of Control Payment, all Securities accepted for
<PAGE>
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payment pursuant to the Change of Control Offer shall cease to
accrue interest after the Change of Control Payment Date;
(5) that Holders electing to have any Securities
purchased pursuant to a Change of Control Offer will be
required to surrender the Securities, with the form entitled
"Option of Holder to Elect Purchase" on the reverse of the
Securities completed, to the Paying Agent at the address speci-
fied in the notice no later than the close of business on the
Business Day immediately prior to the Change of Control Payment
Date;
(6) that Holders will be entitled to withdraw their
election if the Paying Agent receives, not later than the close
of business on the Business Day two Business Days immediately
prior to the Change of Control Payment Date, a telegram, telex,
facsimile transmission or letter setting forth the name of the
Holder, the principal amount of Securities delivered for pur-
chase, and a statement that such Holder is withdrawing his
election to have such Securities purchased;
(7) that Holders whose Securities are being pur-
chased only in part will be issued new Securities equal in
principal amount to the unpurchased portion of the Securities
surrendered, which unpurchased portion must be equal to $1,000
in principal amount or an integral multiple thereof; and
(8) the circumstances and relevant facts surrounding
such Change of Control.
No failure of the Company to give the foregoing
notice shall limit any Holder's right to exercise a repurchase
right.
On the Change of Control Payment Date, the Company
will: (i) accept for payment Securities or portions thereof
tendered pursuant to the Change of Control Offer; (ii) deposit
with the Paying Agent in immediately available funds an amount
equal to the Change of Control Price in respect of all Securi-
ties, or portions thereof so tendered; and (iii) deliver or
cause to be delivered to the Trustee the Securities so accepted
together with an Officers' Certificate stating the principal
amount of the Securities or portions thereof tendered to the
Company. The Paying Agent shall promptly mail to the Holders
of Securities so accepted payment in an amount equal to the
purchase price for such Securities and return any Securities
which were tendered but for which a withdrawal of election was
<PAGE>
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received by the Paying Agent before the Change of Control Pay-
ment Date, and the Trustee shall promptly authenticate and mail
to each Holder new Securities equal in principal amount to any
unpurchased portion of the Securities surrendered, if any; pro-
vided, however, that each such new Security shall be in a prin-
cipal amount of $1,000 or an integral multiple thereof.
In connection with any Change of Control Offer under
this Section 4.15, the Company shall (i) comply with Rule 14e-1
under the Exchange Act, and (ii) otherwise comply with all Fed-
eral and State securities laws so as to permit the rights and
obligations under this Section 4.15 to be exercised in the time
and in the manner specified. To the extent the provisions of
any such rule conflict with the provisions of this Section
4.15, the Company shall be required to comply with the provi-
sions of such rule and shall be deemed not to have breached its
obligations relating to such Change of Control Offer by virtue
thereof.
SECTION 4.16. Limitation on Asset Sales.
(a) The Company will not, and will not permit any of
its Restricted Subsidiaries to, consummate an Asset Sale unless
(i) the Company (or the Restricted Subsidiary, as the case may
be) receives consideration at the time of such Asset Sale at
least equal to the Fair Market Value of the assets sold or
otherwise disposed of and (ii) at least 75% of the considera-
tion therefor received by the Company or such Restricted Sub-
sidiary is in the form of cash or Cash Equivalents; provided,
however, that any notes or other obligations received by the
Company or any such Restricted Subsidiary from such transferee
that are immediately converted by the Company or such
Restricted Subsidiary into cash or Cash Equivalents (to the
extent of the cash or Cash Equivalents received), shall be
deemed to be cash or Cash Equivalents for purposes of this pro-
vision; and provided, further, that the restriction in (ii)
above shall not (x) apply to any Asset Sale where the Fair Mar-
ket Value of the net proceeds received by the Company or its
Restricted Subsidiaries does not exceed $20 million, except to
the extent such Asset Sale is one of a series of related Asset
Sales where the Fair Market Value of the aggregate net proceeds
received therefor does exceed $20 million or (y) prohibit the
Company or any Restricted Subsidiary from receiving as all or
part of the consideration for any Asset Sale, Capital Stock of
any Person which is listed on a United States national securi-
ties exchange; provided, however, that (A) such Asset Sale is
approved by the Board of Directors of the Company, (B) the
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Company or the Restricted Subsidiary receives a written opinion
as to the fairness of such Asset Sale from a financial point of
view to the Company or such Restricted Subsidiary from an
investment banking firm of national standing and (C) the Net
Cash Proceeds resulting from the sale, conversion, exchange or
disposition of such Capital Stock received by the Company or
Restricted Subsidiary are applied in accordance with the provi-
sions of Section 4.16(b) below.
(b) Within 270 days after the date of any Asset
Sale, the Company shall apply the Net Cash Proceeds from such
Asset Sale to either (i) permanently reduce Senior Debt or pur-
chase Senior Notes in accordance with the Indenture under which
the Senior Notes were issued, (ii) redeem, repurchase or retire
the Company's 10>% Senior Subordinated Notes due 1998 (at a
price no greater than the redemption price, plus accrued and
unpaid interest, if any, to the date of redemption, repurchase
or retirement as specified in the indenture under which such
securities were issued) or (iii) make any investment in proper-
ties and assets in the same or similar lines of businesses as
those conducted by the Company and its Restricted Subsidiaries
on the date of this Indenture. Pending the final application
of any such Net Cash Proceeds, the Company may invest such Net
Cash Proceeds in any manner that is not prohibited by this
Indenture. Any Net Cash Proceeds from an Asset Sale that are
not applied or invested as provided above will be deemed to
constitute "Senior Subordinated Excess Proceeds."
(c) When the aggregate amount of Senior Subordinated
Excess Proceeds exceeds $20 million, the Company shall, within
30 days of the occurrence of such event, make an offer to all
Securityholders (a "Senior Subordinated Asset Sale Offer") to
purchase the maximum principal amount of Securities that may be
purchased out of the Senior Subordinated Excess Proceeds, at an
offer price in cash in an amount equal to 100% of the principal
amount thereof, plus accrued and unpaid interest, if any, to
the date fixed for the closing of such offer, in accordance
with the procedures set forth in this Indenture. Notice of
such Senior Subordinated Asset Sale Offer shall be mailed or
cause to be mailed, by first-class mail, by the Company, or at
the written request and expense of the Company (which request
shall be received by the Trustee no more than 15 days following
the occurrence of such event, unless a shorter notice shall be
satisfactory to the Trustee at its sole discretion), the Trus-
tee to all Holders at their last registered addresses as of a
date within 15 days prior to the mailing of such notice, with a
copy to the Trustee; provided, however, that the text of any
<PAGE>
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such notice requested to be delivered by the Trustee shall, at
the sole discretion of the Trustee and within five days of the
request by the Trustee, be prepared or approved by the Company
and the Trustee shall have no responsibility whatsoever with
regard to such notice being accurate or correct. The notice
shall contain all instructions and materials necessary to
enable such Holders to tender Securities pursuant to the Senior
Subordinated Asset Sale Offer and shall state the following
terms:
(1) that the Senior Subordinated Asset Sale Offer is
being made pursuant to this Section 4.16 and that all Securi-
ties tendered will be accepted for payment; provided, however,
that if the aggregate principal amount of Securities tendered
in the Senior Subordinated Asset Sale Offer exceeds the aggre-
gate amount of the Senior Subordinated Excess Proceeds, the
Trustee shall select the Securities to be purchased on a pro
rata basis (with such adjustments as may be deemed appropriate
by the Trustee, so that only Securities in denominations of
$1,000 or multiples thereof shall be purchased). To the extent
that the aggregate amount of Securities tendered pursuant to
the Senior Subordinated Asset Sale Offer is less than the
Senior Subordinated Excess Proceeds, the Company may use such
excess for general corporate purposes. Upon the completion of
the Senior Subordinated Asset Sale Offer, the amount of Senior
Subordinated Excess Proceeds shall be reset at zero;
(2) the purchase price (including the amount of
accrued interest, if any) and the purchase date (which shall be
no earlier than 30 days nor later than 40 days from the date
such notice is mailed, other than as may be required by law)
(the "Proceeds Purchase Date");
(3) that any Security not tendered will continue to
accrue interest;
(4) that, unless there is a default in making pay-
ment therefor, any Security accepted for payment pursuant to
the Senior Subordinated Asset Sale Offer shall cease to accrue
interest after the Proceeds Purchase Date;
(5) that Holders electing to have a Security pur-
chased pursuant to a Senior Subordinated Asset Sale Offer will
be required to surrender the Security, with the form entitled
"Option of Holder to Elect Purchase" on the reverse of the
Security completed, to the Paying Agent at the address
<PAGE>
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specified in the notice prior to the close of business on the
Business Day immediately prior to the Proceeds Purchase Date;
(6) that Holders will be entitled to withdraw their
election if the Paying Agent receives, not later than the close
of business on the Business Day two Business Days immediately
prior to the Proceeds Purchase Date, a telegram, telex, fac-
simile transmission or letter setting forth the name of the
Holder, the principal amount of the Securities the Holder
delivered for purchase and a statement that such Holder is
withdrawing his or her election to have such Securities pur-
chased; and
(7) that Holders whose Securities are purchased only
in part will be issued new Securities in a principal amount
equal to the unpurchased portion of the Securities surrendered.
On or before the Proceeds Purchase Date, the Company
or such Subsidiary, as the case may be, shall (i) accept for
payment Securities or portions thereof tendered pursuant to the
Senior Subordinated Asset Sale Offer which are to be purchased
in accordance with item (c)(1) above, (ii) deposit in immedi-
ately available funds with the Paying Agent money sufficient to
pay the purchase price of all Securities to be purchased and
(iii) deliver to the Trustee Securities so accepted together
with an Officers' Certificate stating the Securities or por-
tions thereof being purchased by the Company. The Paying Agent
shall promptly mail to the Securityholders so accepted payment
in an amount equal to the purchase price.
(d) To the extent that any or all of the Net Cash
Proceeds of any Foreign Asset Sale are prohibited or delayed by
applicable local law from being repatriated to the United
States, the portion of such Net Cash Proceeds so affected will
not be required to be applied in accordance with the foregoing
provisions (other than to repay Indebtedness of the entities
engaging in such Foreign Asset Sale or, if permitted by local
law, Indebtedness of the Company or a Restricted Subsidiary
outside the United States, in each case as contemplated by the
provisions above) at the time provided above but may be
retained by the entity engaging in such Foreign Asset Sale so
long, but only so long, as the applicable local law will not
permit repatriation to the United States (with the Company
agreeing to cause such entity to promptly take all actions
required by the applicable local law to permit such repatria-
tion) and once such repatriation of any of such affected Net
Cash Proceeds is permitted under the applicable local law, such
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repatriation will be immediately effected and such repatriated
Net Cash Proceeds will be applied in the manner set forth in
this Section 4.16 as if the Asset Sale had occurred on such
date.
(e) Notwithstanding the foregoing, the Company will
not, and will not permit any Restricted Subsidiary to, directly
or indirectly, make any Asset Sale of any of the Capital Stock
of any Restricted Subsidiary except (i) pursuant to an Asset
Sale of all of the Capital Stock of such Restricted Subsidiary
or (ii) unless (x) such Restricted Subsidiary is designated as
an Unrestricted Subsidiary immediately prior to, and condi-
tioned upon, the consummation of the Asset Sale of such Capital
Stock and (y) immediately after giving effect to such Asset
Sale and designation (on a pro forma basis as if such Asset
Sale and designation had been made at the beginning of the
applicable Four Quarter Period), the Company could incur at
least $1.00 of additional Indebtedness (other than Permitted
Indebtedness) pursuant to the provisions of Section 4.09
hereof.
SECTION 4.17. Maintenance of Properties and Insur-
ance. The Company shall cause all material properties owned by
or leased to it or any Subsidiary and used or useful in the
conduct of its business or the business of such Subsidiary to
be maintained and kept in normal condition, repair and working
order and supplied with all necessary equipment and shall cause
to be made all necessary repairs, renewals, replacements, bet-
terments and improvements thereof, all as in the judgment of
the Company may be necessary so that the business carried on in
connection therewith may be properly and advantageously con-
ducted at all times; provided, however, that nothing in this
Section 4.17 shall prevent the Company or any Subsidiary from
discontinuing the maintenance of any such properties, if such
discontinuance is desirable in the conduct of its business or
the business of such Subsidiary.
The Company shall provide or cause to be provided,
for itself and any Subsidiaries, insurance (including appropri-
ate self-insurance) against loss or damage of the kinds custom-
arily insured against by corporations similarly situated and
owning like properties, including, but not limited to, public
liability insurance, with reputable insurers in such amounts
with such deductibles and by such methods as shall be customary
for corporations similarly situated in the industry.
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SECTION 4.18. Payments for Consents. Neither the
Company nor any of its Subsidiaries shall, directly or indi-
rectly, pay or cause to be paid any consideration, whether by
way of interest, fee or otherwise, to any Holder of any Securi-
ties for or as an inducement to any consent, waiver or amend-
ment of any of the terms or provisions of this Indenture or the
Securities unless such consideration is offered to be paid or
agreed to be paid to all Holders of the Securities which so
consent, waive or agree to amend in the time frame set forth in
the solicitation documents relating to such consent, waiver or
agreement.
SECTION 4.19. Limitation on Applicability of Certain
Covenants. During any period of time that (i) the ratings are
assigned to both the Securities and the Senior Notes by both
Standard & Poor's Ratings Group and Moody's Investors Services,
Inc. (collectively, the "Rating Agencies") and such ratings are
equal to or higher than BBB- and Baa3, respectively (the
"Investment Grade Ratings") and (ii) no Event of Default or
Default has occurred and is continuing, the Company and its
Restricted Subsidiaries will not be subject to Sections 4.08,
4.09, 4.10, 4.13 and 4.16 of this Indenture (collectively, the
"Suspended Covenants"). In the event that the Company is not
subject to the Suspended Covenants for any period of time as a
result of the preceding sentence and, subsequently, one or both
Rating Agencies withdraws its rating or downgrades the ratings
assigned to the Securities or the Senior Notes below the
required Investment Grade Ratings, then the Company and its
Restricted Subsidiaries will again be subject to the Suspended
Covenants and compliance with the Suspended Covenants with
respect to Restricted Payments made after the time of such
withdrawal or downgrade will be calculated in accordance with
the terms of Section 4.08 as if such section had been in effect
during the entire period of time from the date of this Inden-
ture; provided, however, that any action taken by the Company
or a Subsidiary during the time it was not subject to, and
which but for such suspension would have been prohibited by,
the Suspended Covenants shall not constitute an Event of
Default by virtue of the Company again becoming subject to the
Suspended Covenants.
SECTION 4.20. Further Assurances. From time to time
the Company shall, at its own expense and upon request of the
Trustee, execute and deliver or cause to be executed and deliv-
ered such further instruments and do such further acts as may
reasonably be necessary or desirable to carry out the purposes
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of this Indenture or to secure the rights and remedies hereun-
der of the Holders.
SECTION 4.21. Limitation on Senior Subordinated
Debt. The Company will not, directly or indirectly, become
liable, contingently or otherwise, with respect to any Indebt-
edness that is subordinated or junior in right of payment to
any Senior Debt of the Company and senior in right of payment
to the Securities.
ARTICLE 5
SUCCESSOR CORPORATION
SECTION 5.01. Limitation on Merger, Consolidation
and Sale of Substantially All Assets. The Company may not con-
solidate or merge with or into, or sell, assign, transfer,
lease, convey or otherwise dispose of all or substantially all
of its properties or assets in one or more related transactions
to, another Person or adopt a plan of liquidation unless:
(i) the Company is the surviving corporation or the
entity or the person (the "Surviving Corporation") formed
by or surviving any such consolidation or merger (if other
than the Company) or to which such sale, assignment,
transfer, lease, conveyance or other disposition shall
have been made, is a corporation organized or existing
under the laws of the United States, any state thereof or
the District of Columbia;
(ii) the Surviving Corporation expressly assumes
(pursuant to a supplemental indenture in a form reasonably
satisfactory to the Trustee) all the Obligations of the
Company under the Securities and this Indenture;
(iii) immediately after giving effect to such transac-
tion, no Default or Event of Default shall have occurred
and be continuing;
(iv) the Surviving Corporation (x) will have Consoli-
dated Net Worth immediately after giving effect to the
transaction, on a pro forma basis (including any Indebted-
ness incurred or anticipated to be incurred in connection
with the transaction), equal to or greater than the Con-
solidated Net Worth of the Company immediately preceding
the transaction and (y) will, at the time of such transac-
tion and after giving pro forma effect thereto as if such
transaction had occurred as of the beginning of the
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applicable Four-Quarter Period, be permitted to incur at
least $1.00 of additional Indebtedness (other than Permit-
ted Indebtedness) pursuant to Section 4.09 hereof; and
(v) immediately after giving effect to such transac-
tion on a pro forma basis, the Consolidated Interest
Coverage Ratio of the Surviving Corporation is at least
2.0 to 1.0; provided, however, that, if the Consolidated
Interest Coverage Ratio of the Company immediately prior
to such transaction is within the range set forth in Col-
umn (A) below, then the pro forma Consolidated Interest
Coverage Ratio of the Surviving Corporation shall be at
least equal to the lesser of (1) the ratio determined by
multiplying the percentage set forth in column (B) below
by the Consolidated Interest Coverage Ratio of the Company
immediately prior to such transaction and (2) the ratio
set forth in column (C) below:
(A) (B) (C)
2.22 to 1.0 to 2.99 to 1.0......... 90% 2.4 to 1.0
3.00 to 1.0 to 3.99 to 1.0......... 80% 2.8 to 1.0
4.00 to 1.0 or more................ 70% 2.9 to 1.0
; and provided, further, that if, immediately after giving
effect to such transaction on a pro forma basis, the Consoli-
dated Interest Coverage Ratio of the Surviving Corporation is
3.0 to 1.0 or more, the calculation in the preceding proviso
shall be inapplicable and such transaction shall be deemed to
have complied with the requirements of subparagraph (v).
In connection with any consolidation, merger or
transfer contemplated hereby, the Company shall deliver, or
cause to be delivered, to the Trustee, in form and substance
reasonably satisfactory to the Trustee, an Officers' Certifi-
cate and an Opinion of Counsel, each stating that such consoli-
dation, merger or transfer and the supplemental indenture in
respect thereto comply with this Section 5.01 and that all con-
ditions precedent herein provided for relating to such transac-
tions have been complied with.
SECTION 5.02. Successor Corporation Substituted.
Upon any consolidation or merger or any transfer of all or sub-
stantially all of the assets of the Company in accordance with
Section 5.01 hereof, the successor corporation formed by such
consolidation or into which the Company is merged or to which
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such transfer is made, shall succeed to, and be substituted
for, and may exercise every right and power of the Company
under this Indenture with the same effect as if such successor
corporation had been named herein as the Company; and there-
after, the Company shall be discharged and released from all
obligations and covenants under this Indenture and the
Securities.
ARTICLE 6
DEFAULTS AND REMEDIES
SECTION 6.01. Events of Default. An "Event of
Default" occurs if any of the following shall have occurred and
be continuing:
(1) The Company defaults in the payment of (a)
interest on any Security (whether or not prohibited by Article
10 hereof) when the same becomes due and payable and the
default continues for a period of 30 days, or (b) the principal
of or premium, if any, on any Security (whether or not prohib-
ited by Article 10 hereof) when the same becomes due and pay-
able at maturity or by redemption or otherwise;
(2) The Company fails to comply with the terms of
Article 5 hereof;
(3) The Company fails to comply with any of its cov-
enants (but in the case of Suspended Covenants, only during the
time the Company is subject to such covenants) or agreements in
the Securities or this Indenture (other than those referred to
in clauses (1) and (2) above) and such failure continues for 30
days after receipt by the Company of a Notice of Default as
described in the penultimate paragraph of this Section 6.01;
(4) A default occurs under any mortgage, indenture,
guaranty or instrument under which there may be issued or by
which there may be secured or evidenced any Indebtedness of the
Company or any of its Restricted Subsidiaries whether such
Indebtedness existed as of the date of this Indenture or was
created thereafter, if (x) either (a) as a result of such
default, the maturity of such Indebtedness has been accelerated
prior to its expressed maturity or (b) such default results
from the failure to pay any such Indebtedness at its stated
maturity (after any applicable grace periods) and (y) the prin-
cipal amount of such Indebtedness aggregates $25,000,000 or
more;
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(5) Final judgments for the payments of money which
in the aggregate exceed $25,000,000 shall be entered against
the Company or any Restricted Subsidiary by a court of compe-
tent jurisdiction and either (a) enforcement proceedings shall
have been commenced by any creditor upon such judgments, or (b)
such judgments shall remain undischarged for 45 consecutive
days after such judgments, during which a stay of enforcement
of such judgments shall not be in effect;
(6) The Company or any Restricted Subsidiary pursu-
ant to or within the meaning of any Bankruptcy Law (a) com-
mences a voluntary case or proceeding; (b) consents to the
entry of an order for relief against it in an involuntary case
or proceeding; (c) consents to the appointment of a custodian
of it or for all or substantially all of its property; (d)
makes a general assignment for the benefit of its creditors; or
(e) admits in writing its inability to pay its debts generally
as they become due; or
(7) A court of competent jurisdiction enters an
order or decree under any Bankruptcy Law that (a) is for relief
against the Company or any Restricted Subsidiary in an involun-
tary case or proceeding; (b) appoints a custodian of the Com-
pany or any Restricted Subsidiary for all or substantially all
of their respective properties; or (c) orders the liquidation
of the Company or any Restricted Subsidiary and in each case
the order or decree remains unstayed and in effect for 60 days.
A Default under clause (3) above is not an Event of
Default until the Trustee notifies the Company, or the Holders
of at least 25% in aggregate principal amount of the Securities
at the time outstanding notify the Company and the Trustee, of
the Default and the Company does not cure such Default within
the time specified in such clause after receipt of such notice.
Any such notice must specify the Default, demand that it be
remedied and state that such notice is a "Notice of Default."
The Company is required to deliver to the Trustee,
pursuant to Section 4.04(a), a statement regarding compliance
with this Indenture, and the Company is required, upon becoming
aware of any Default or Event of Default, to deliver to the
Trustee a statement specifying such Default an Event of
Default.
SECTION 6.02. Acceleration. If any Event of Default
(other than an Event of Default specified in clauses (6) and
(7) of Section 6.01) occurs and is continuing, the Trustee by
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notice to the Company, or the Holders of at least 25% in aggre-
gate principal amount of the Securities at the time outstanding
by notice to the Company and the Trustee, may declare the
unpaid principal of and accrued interest on the Securities to
be immediately due and payable. If any Event of Default under
clause (6) or (7) of Section 6.01 occurs, all unpaid principal
and accrued interest on the Securities shall ipso facto become
and be immediately due and payable without any declaration,
notice or other act on the part of the Trustee or any Holder.
The Holders of a majority in aggregate principal amount of the
Securities at the time outstanding by written notice to the
Trustee may rescind an acceleration and its consequences if the
rescission would not conflict with any judgment or decree and
if all existing Events of Default have been cured or waived
except non-payment of principal or interest that has become due
solely because of the acceleration.
SECTION 6.03. Other Remedies. If an Event of
Default occurs and is continuing, the Trustee may pursue any
available remedy by proceeding at law or in equity to collect
the payment of principal of, premium, if any, or interest on
the Securities or to enforce the performance of any provision
of the Securities or this Indenture.
The Trustee may maintain a proceeding even if the
Trustee does not possess any of the Securities or does not pro-
duce any of the Securities in the proceeding. A delay or omis-
sion by the Trustee or any Securityholder in exercising any
right or remedy accruing upon an Event of Default shall not
impair the right or remedy or constitute a waiver of, or acqui-
escence in, the Event of Default. No remedy is exclusive of
any other remedy. All available remedies are cumulative to the
extent permitted by law.
SECTION 6.04. Waiver of Past Defaults. The Holders
of a majority in aggregate principal amount of the Securities
at the time outstanding, by notice to the Trustee (and without
notice to any other Securityholder), may waive an existing
Default or Event of Default and its consequences except (i) an
Event of Default described in Section 6.01(1) hereof, or (ii) a
Default in respect of a provision that under Section 9.02
hereof cannot be amended without the consent of each
Securityholder affected. When a Default or an Event of Default
is waived, it shall be deemed cured and shall cease to exist,
but no such waiver shall extend to any subsequent or other
Default or impair any consequent right.
<PAGE>
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SECTION 6.05. Control by Majority. The Holders of a
majority in aggregate principal amount of the Securities at the
time outstanding may direct the time, method and place of con-
ducting any proceeding for any remedy available to the Trustee
or of exercising any trust or power conferred on the Trustee.
However, the Trustee may refuse to follow any direction that
conflicts with law or this Indenture or that the Trustee deter-
mines in good faith is unduly prejudicial to the rights of
other Securityholders or would involve the Trustee in personal
liability.
SECTION 6.06. Limitation on Suits. Except as pro-
vided in Section 6.07 hereof, a Securityholder may not pursue
any remedy with respect to this Indenture or the Securities
unless:
(1) the Holder gives to the Trustee written notice
of a continuing Event of Default;
(2) the Holders of at least 25% in aggregate princi-
pal amount of the Securities at the time outstanding make a
written request to the Trustee to pursue the remedy;
(3) such Holder or Holders offer to the Trustee
indemnity reasonably satisfactory to the Trustee against any
loss, liability or expense;
(4) the Trustee does not comply with the request
within 60 days after receipt of the notice, the request and the
offer of indemnity; and
(5) the Holders of a majority in aggregate principal
amount of the Securities at the time outstanding do not give
the Trustee a direction inconsistent with the request during
such 60-day period.
A Securityholder may not use this Indenture to preju-
dice the rights of any other Securityholder or to obtain a
preference or priority over any other Securityholder.
SECTION 6.07. Rights of Holders to Receive Payment.
Notwithstanding any other provision of this Indenture, the
right of any Holder to receive payment of the principal, pre-
mium, if any, or interest, in respect of the Securities held by
such Holder, on or after the respective due dates expressed in
the Securities, or to bring suit for the enforcement of any
such payment on or after such respective dates, shall not be
<PAGE>
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impaired or adversely affected without the consent of each such
Holder.
SECTION 6.08. Collection Suit by Trustee. If an
Event of Default described in Section 6.01(1) hereof occurs and
is continuing, the Trustee may recover judgment in its own name
and as trustee of an express trust against the Company for the
whole amount owing with respect to the Securities and, to the
extent lawful, expenses of collection, including reasonable
compensation, expenses, disbursements and advances of the Trus-
tee, its agents and counsel.
SECTION 6.09. Trustee May File Proofs of Claim. In
case of the pendency of any receivership, insolvency, liquida-
tion, bankruptcy, reorganization, arrangement, adjustment, com-
position or other judicial proceeding relative to the Company
or its properties, the Trustee shall be entitled and empowered,
by intervention in such proceeding or otherwise:
(1) to file and prove a claim for the whole amount
of the principal, premium, if any, and interest on the Securi-
ties and to file such other papers or documents as may be nec-
essary or advisable in order to have the claims of the Trustee
(including any claim for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and coun-
sel) and of the Holders allowed in such judicial proceeding;
and
(2) to collect and receive any moneys or other prop-
erty payable or deliverable on any such claims and to distrib-
ute the same; and any Custodian in any such judicial proceeding
is hereby authorized by each Holder to make such payments to
the Trustee and, in the event that the Trustee shall consent to
the making of such payments directly to the Holders, to pay the
Trustee any amount due it for the reasonable compensation,
expenses, disbursements and advances of the Trustee, its agents
and counsel, and any other amounts due the Trustee under Sec-
tion 7.07 hereof.
Nothing herein contained shall be deemed to authorize
the Trustee to authorize or consent to or accept or adopt on
behalf of any Holder any plan of reorganization, arrangement,
adjustment or composition affecting the Securities or the
rights of any Holder thereof, or to authorize the Trustee to
vote in respect of the claim of any Holder in any such
proceeding.
<PAGE>
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SECTION 6.10. Priorities. If the Trustee collects
any money pursuant to this Article 6, it shall pay out the
money in the following order:
FIRST: to the Trustee for amounts due under Section
7.07 hereof;
SECOND: to the Securityholders for amounts due and
unpaid on the Securities for principal and interest, ratably,
without preference or priority of any kind, according to such
amounts due and payable on the Securities for principal and
interest, respectively; and
THIRD: the balance, if any, to the Company.
The Trustee may fix a record date and payment date
for any payment to Securityholders pursuant to this Section
6.10 and give whatever notice to the Securityholders as the
Trustee deems appropriate.
SECTION 6.11. Undertaking for Costs. In any suit
for the enforcement of any right or remedy under this Indenture
or in any suit against the Trustee for any action taken or
omitted by it as Trustee, a court in its discretion may require
the filing by any party litigant (other than the Trustee) in
the suit of an undertaking to pay the costs of the suit, and
the court in its discretion may assess reasonable costs,
including reasonable attorneys' fees and expenses, against any
party litigant in the suit, having due regard to the merits and
good faith of the claims or defenses made by the party liti-
gant. This Section 6.11 does not apply to a suit by the Trus-
tee, a suit by a Holder pursuant to Section 6.07 hereof or a
suit by Holders of more than 10% in aggregate principal amount
of the Securities at the time outstanding.
ARTICLE 7
TRUSTEE
SECTION 7.01. Duties of Trustee.
(a) If an Event of Default has occurred and is con-
tinuing, the Trustee shall exercise the rights and powers
vested in it by this Indenture and use the same degree of care
and skill in its exercise as a prudent man would exercise or
use under the circumstances in the conduct of his own affairs.
<PAGE>
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(b) Except during the continuance of an Event of
Default:
(1) the Trustee need perform only those duties
that are specifically set forth in this
Indenture and no others; and
(2) in the absence of bad faith on its part,
the Trustee may conclusively rely, as to
the truth of the statements and the cor-
rectness of the opinions expressed therein,
upon certificates or opinions furnished to
the Trustee and conforming to the require-
ments of this Indenture. However, in the
case of any such certificates or opinions
which by any provision hereof are specifi-
cally required to be furnished to the Trus-
tee, the Trustee shall examine the certifi-
cates and opinions to determine whether or
not they conform to the requirements of
this Indenture.
The Trustee shall not be liable for any interest on
any money received by it.
(c) The Trustee may not be relieved from liability
for its own negligent action, its own negligent failure to act
or its own willful misconduct, except that:
(1) this paragraph (c) does not limit the
effect of paragraph (d) of this Section
7.01 or the effect of Section 7.02;
(2) the Trustee shall not be liable for any
error of judgment made in good faith by an
Officer of the Trustee unless it is proved
that the Trustee was negligent in ascer-
taining the pertinent facts; and
(3) the Trustee shall not be liable with
respect to any action it takes or omits to
take in good faith in accordance with a
direction received by it pursuant to Sec-
tion 6.05 hereof.
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(d) Every provision of this Indenture that in any
way relates to the Trustee is subject to paragraphs (a), (b),
(c) and (e) of this Section 7.01.
(e) The Trustee's performance of any of its duties
hereunder or the exercise of any of its rights or powers shall
not require the Trustee to expend or risk its own funds or
otherwise incur any financial liability unless it shall receive
security or indemnity satisfactory to it against any loss, lia-
bility or expense.
(f) Money held by the Trustee in trust hereunder
need not be segregated from other funds except to the extent
required by law. The Trustee shall be under no liability for
interest on any money held by it hereunder.
SECTION 7.02. Rights of Trustee.
(a) The Trustee may rely and shall be protected in
acting or refraining from acting upon any resolution, certifi-
cate, statement, instrument, opinion, report, notice, request,
direction, consent, order, bond, debenture, note, other evi-
dence of indebtedness, approval or other paper or document
believed by it to be genuine and to have been signed or pre-
sented by the proper party or parties.
(b) Before the Trustee acts or refrains from acting,
it may require an Officers' Certificate, an Opinion of Counsel
or reports of accountants and other experts covering such mat-
ters as the Trustee may reasonably require. The Trustee shall
not be liable for any action it takes or omits to take in good
faith in reliance on such Officers' Certificate, Opinion of
Counsel or reports.
(c) The Trustee may execute any of the trusts or
powers hereunder or perform any duties hereunder either
directly or by or through agents or attorneys and the Trustee
shall not be responsible for any misconduct or negligence on
the part of any agent or attorney appointed with due care by it
hereunder.
(d) The Trustee shall not be liable for any action
it takes or omits to take in good faith which it believes to be
authorized or within its rights or powers.
(e) The Trustee shall not be bound to make any
investigation into the facts or matters stated in any
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resolution, certificate, statement, instrument, opinion,
report, notice, request, direction, consent, order, bond,
debenture, note, other evidence of Indebtedness or other paper
or document, but the Trustee, in its discretion, may make such
further inquiry or investigation into such facts or matters as
it may see fit, and, if the Trustee shall determine to make
such further inquiry or investigation, it shall be entitled to
examine the books, records and premises of the Company person-
ally or by agent or attorney.
(f) The Trustee may consult with counsel, accoun-
tants and other experts of its selection and the advice of such
persons or any Opinion of Counsel or reports of accountants or
other experts shall be full and complete authorization and pro-
tection in respect of any action taken, suffered or omitted by
it hereunder in good faith and in reliance thereon.
(g) The Trustee shall be under no obligation to
exercise any of the rights or powers vested in it by this
Indenture at the request or direction of any of the Holders
pursuant to this Indenture, unless such Holders shall have
offered to the Trustee reasonable security and indemnity
against the costs, expenses and liabilities which might be
incurred by it in compliance with such request or direction.
(h) The Trustee shall be aware of an Event of
Default only if it has received written notice thereof.
SECTION 7.03. Individual Rights of Trustee. The
Trustee in its individual or any other capacity may become the
owner or pledgee of Securities and may otherwise deal with the
Company or its Affiliates with the same rights it would have if
it were not Trustee. Any Paying Agent, Registrar or
co-registrar may do the same with like rights. However, the
Trustee must comply with Sections 7.10 and 7.11 hereof.
SECTION 7.04. Trustee's Disclaimer. The Trustee
makes no representation as to the validity or adequacy of this
Indenture or the Securities, it shall not be accountable for
the Company's use or application of the Securities or of the
proceeds thereof and it shall not be responsible for any state-
ment in the registration statement for the Securities under the
Securities Act of 1933, as amended (the "Securities Act")
(other than statements contained in the Form T-1 filed with the
SEC under the TIA), or in this Indenture or the Securities
(other than its certificate of authentication), or the
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determination as to which beneficial owners are entitled to
receive any notices hereunder.
SECTION 7.05. Notice of Defaults. If a Default
occurs and is continuing and if it is known to the Trustee, the
Trustee shall mail to each Securityholder, as its name and
address appears on the Register, notice of the Default within
90 days after it becomes known to the Trustee unless such
Default shall have been cured or waived. Except in the case of
a Default described in Section 6.01(1) hereof, the Trustee may
withhold such notice if and so long as a committee of Officers
of the Trustee in good faith determines that the withholding of
such notice is in the interests of Securityholders. The second
sentence of this Section 7.05 shall be in lieu of the proviso
to Section 315(b) of the TIA and said proviso is hereby
expressly excluded from this Indenture, as permitted by the
TIA.
SECTION 7.06. Reports by Trustee to Holders. Within
60 days after each May 15 beginning with May 15, 1994, the
Trustee shall mail to each Securityholder a brief report dated
as of such May 15 in accordance with and to the extent required
under Section 313 of the TIA.
A copy of each report at the time of its mailing to
Securityholders shall be filed with the Company, the SEC and
each stock exchange on which the Securities are listed, if any.
The Company agrees to notify the Trustee promptly whenever the
Securities become listed on any stock exchange and of any
delisting thereof.
SECTION 7.07. Compensation and Indemnity. The Com-
pany agrees:
(1) To pay to the Trustee from time to time reason-
able compensation for all services rendered by it hereunder
(which compensation shall not be limited by any provision of
law in regard to the compensation of a trustee of an express
trust);
(2) To reimburse the Trustee upon its request for
all reasonable expenses, disbursements and advances incurred or
made by the Trustee in accordance with any provision of this
Indenture (including the reasonable compensation and the
expenses, disbursements and advances of its agents and coun-
sel), except any such expense, disbursement or advance as may
be attributable to its negligence or bad faith; and
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(3) To indemnify the Trustee for, and to hold it
harmless against, any and all loss, liability or expense,
incurred without negligence or bad faith on its part, arising
out of or in connection with the acceptance or administration
of this trust, including the reasonable costs and expenses of
defending itself against any claim or liability in connection
with the exercise or performance of any of its powers or duties
hereunder.
The Trustee shall have a claim and lien prior to the
Securities as to all property and funds held by it hereunder
for any amount owing it or any predecessor Trustee pursuant to
this Section 7.07, except with respect to funds held in trust
for the payment of principal of, premium, if any, or interest
on particular Securities.
The Company's obligations pursuant to this Section
7.07 shall survive the satisfaction and discharge of this
Indenture. When the Trustee incurs expenses after the occur-
rence of a Default specified in Section 6.01 hereof, the
expenses are intended to constitute expenses of administration
under any Bankruptcy Law.
SECTION 7.08. Replacement of Trustee. The Trustee
may resign by so notifying the Company in writing at least 30
days prior to the date of the proposed resignation; provided,
however, no such resignation shall be effective until a succes-
sor Trustee has accepted its appointment pursuant to this Sec-
tion 7.08. The Trustee may be removed by an Act of the Holders
of a majority in aggregate principal amount of the Securities
at the time outstanding delivered to the Trustee and the Com-
pany. Such Holders may by such an Act delivered to the Trustee
appoint a successor Trustee subject to the consent of the Com-
pany. The Trustee shall resign if:
(1) the Trustee fails to comply with Section 7.10
hereof;
(2) the Trustee is adjudged bankrupt or insolvent;
(3) a receiver or public officer takes charge of the
Trustee or its property; or
(4) the Trustee otherwise becomes incapable of
acting.
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If the Trustee resigns or is removed or if a vacancy
exists in the office of Trustee for any reason, the Company
shall promptly appoint, by resolution of its Board of Direc-
tors, a successor Trustee.
A successor Trustee shall deliver a written accep-
tance of its appointment to the retiring Trustee and to the
Company. Thereupon the resignation or removal of the retiring
Trustee shall become effective, and the successor Trustee with-
out any further act, deed or conveyance, shall become vested
with and have all the rights, powers and duties of the Trustee
under this Indenture. The successor Trustee shall mail a
notice of its succession to Securityholders. Subject to pay-
ment of all amounts owing to the Trustee under Section 7.07
hereof and subject further to its lien under Section 7.07, the
retiring Trustee shall promptly transfer all property held by
it as Trustee to the successor Trustee.
If a successor Trustee does not take office within 30
days after the retiring Trustee resigns or is removed, the
retiring Trustee, the Company or the Holders of a majority in
aggregate principal amount of the Securities at the time out-
standing may petition any court of competent jurisdiction for
the appointment of a successor Trustee.
If the Trustee fails to comply with Section 7.10
hereof, any Securityholder may petition any court of competent
jurisdiction for the removal of the Trustee and the appointment
of a successor Trustee.
SECTION 7.09. Successor Trustee by Merger. If the
Trustee consolidates with, merges or converts into, or trans-
fers all or substantially all its corporate trust business or
assets to, another corporation, the resulting, surviving or
transferee corporation without any further act shall be the
successor Trustee.
SECTION 7.10. Eligibility; Disqualification. The
Trustee shall at all times satisfy the requirements of TIA Sec-
tion 310(a)(1). The Trustee shall have a combined capital and
surplus of at least $10,000,000 as set forth in its most recent
published annual report of condition. The Trustee shall comply
with TIA Section 310(b). In determining whether the Trustee
has conflicting interests as defined in TIA Section 310(b)(1),
the provisions contained in the proviso to TIA Section
310(b)(1) shall be deemed incorporated herein.
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SECTION 7.11. Preferential Collection of Claims
Against Company. The Trustee is subject to TIA Section 311(a),
excluding any creditor relationship in TIA Section 311(b). A
Trustee who has resigned or been removed shall be subject to
TIA Section 311(a) to the extent indicated therein.
ARTICLE 8
DISCHARGE OF INDENTURE
SECTION 8.01. Discharge of Liability on Securities;
Defeasance.
(a) When (i) the Company delivers to the Trustee all
outstanding Securities (other than Securities replaced pursuant
to Section 2.07 hereof or Securities which are purchased pursu-
ant to Section 3.08 and Section 4.15 or 4.16 hereof or Securi-
ties for whose payment money has theretofore been held in trust
and thereafter repaid to the Company, as provided in Section
8.02 hereof) for cancellation, or (ii) the Company irrevocably
deposits with the Trustee money and/or U.S. Government Obliga-
tions, maturing as to principal and interest in such amounts
and at such times as are sufficient, without consideration of
any reinvestment of such interest, to pay principal of, and
interest on, the outstanding Securities (other than Securities
replaced pursuant to Section 2.07 hereof) to maturity in accor-
dance with the terms of this Indenture and the Securities
issued hereunder, and if in either case the Company pays all
other sums payable hereunder by the Company, then this Inden-
ture shall, subject to Sections 2.06, 7.07, 8.01(c) and 8.06
hereof, cease to be of further effect. The Trustee shall join
in the execution of any documents prepared by the Company
acknowledging satisfaction and discharge of this Indenture on
written demand of the Company accompanied by an Officers' Cer-
tificate and Opinion of Counsel and at the cost and expense of
the Company.
(b) Subject to Sections 8.01(c), 8.02 and 8.06, the
Company may at any time terminate (i) all its obligations under
the Securities and this Indenture ("legal defeasance"), or (ii)
its obligations under Sections 4.08 through 4.21 ("covenant
defeasance").
The Company may exercise its legal defeasance option
notwithstanding its prior exercise of its covenant defeasance
option. If the Company exercises its legal defeasance option,
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payment of the Securities may not be accelerated because of an
Event of Default with respect thereto.
Upon satisfaction of the conditions set forth herein
and upon request of the Company, the Trustee shall acknowledge
in writing the discharge of those obligations that the Company
terminates.
(c) Notwithstanding clauses (a) and (b) above, the
Company's obligations in Sections 2.03, 2.04, 2.05, 2.06, 2.07,
4.20, 7.07, 7.08, 8.04, 8.05 and 8.06 shall survive until the
Securities have been paid in full. Thereafter, the Company's
obligations in Sections 7.07, 8.04 and 8.05 shall survive.
SECTION 8.02. Conditions to Defeasance. The Company
may exercise its legal defeasance option or its covenant defea-
sance option only if:
(1) the Company irrevocably deposits in trust (the
"defeasance trust") with the Trustee (or, at the option of
the Trustee, another trustee satisfying the requirements
of Section 7.10) money, U.S. Governmental Obligations, or
any combination thereof, sufficient to pay the principal
of, premium, if any, and interest on the Securities to
maturity or redemption, as the case may be;
(2) the Company delivers to the Trustee (and such
other trustee, if any) a certificate from a nationally
recognized firm of independent accountants expressing the
opinion that the payment of principal and interest when
due and without reinvestment on the deposited U.S. Govern-
ment Obligations plus any deposited money without rein-
vestment will provide cash at such times and in such
amounts as will be sufficient to pay principal, premium,
if any, and interest when due on all the Securities to
maturity or redemption, as the case may be;
(3) the Company shall have delivered to the Trustee
(and such other trustee, if any) an Opinion of Counsel to
the effect that the trust funds will not be subject to any
applicable bankruptcy, insolvency, reorganization or simi-
lar laws affecting creditors' rights generally;
(4) no Default or Event of Default shall have
occurred and be continuing on the date of such deposit or,
insofar as Events of Default from bankruptcy or insolvency
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events are concerned, at any time in the period ending on
the 91st day after the date of deposit;
(5) the Company delivers to the Trustee (and such
other Trustee, if any) an Officers' Certificate and an
Opinion of Counsel to the effect that such legal defea-
sance or covenant defeasance shall not result in a breach
or violation of or constitute a default under this Inden-
ture, or any other material agreement or instrument to
which the Company is a party or by which the Company is
bound;
(6) the Company delivers to the Trustee (and such
other trustee, if any) an Opinion of Counsel to the effect
that the trust resulting from the deposit is not required
to be registered as an investment company under the
Investment Company Act of 1940, as amended;
(7) the Company delivers to the Trustee (and such
other trustee, if any) an Opinion of Counsel to the effect
that the Securityholder has a perfected security interest
under applicable law in the U.S. Government Obligations so
deposited;
(8) in the case of legal defeasance, the Company
delivers to the Trustee (and such other trustee, if any)
an Opinion of Counsel confirming that (a) the Company has
received from, or there has been published by, the Inter-
nal Revenue Service a ruling or (b) since the date of the
Indenture, there has been a change in the applicable fed-
eral income tax law, in either case to the effect that,
and based thereon such Opinion of Counsel shall confirm
that, the Securityholder will not recognize income, gain
or loss for federal income tax purposes as a result of
such legal defeasance and will be subject to federal
income tax on the same amounts, in the same manner and at
the same times as would have been the case if such legal
defeasance had not occurred;
(9) in the case of covenant defeasance, the Company
delivers to the Trustee (and such other trustee, if any)
an Opinion of Counsel confirming that the Securityholder
will not recognize income, gain or loss for federal income
tax purposes as a result of such covenant defeasance and
will be subject to federal income tax on the same amounts,
in the same manner and at the same times as would have
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been the case if such covenant defeasance had not
occurred; and
(10) the Company delivers to the Trustee (and such
other Trustee, if any) an Officers' Certificate and an
Opinion of Counsel, each stating that all conditions prec-
edent provided for relating to either the legal defeasance
or the covenant defeasance, as the case may be, have been
complied with.
Notwithstanding the foregoing provisions of this Sec-
tion, the conditions set forth in the foregoing paragraphs (2),
(3), (4), (5), (6) and (7) need not be satisfied so long as, at
the time the Company makes the deposit described in paragraph
(1), (i) no default under Section 6.01(1), 6.01(2), 6.01(6) or
6.01(7) has occurred and is continuing on the date of such
deposit and after giving effect thereto and (ii) either (x) a
notice of redemption has been mailed pursuant to Section 3.05
providing for redemption of all the Securities 30 days after
such mailing and the provisions of Article 3 with respect to
such redemption shall have been complied with or (y) the Stated
Maturity of all of the Securities will occur within 30 days.
If the conditions of the preceding sentence are satisfied, the
Company shall be deemed to have exercised its covenant defea-
sance option.
Before or after a deposit, the Company may make
arrangements satisfactory to the Trustee for the redemption of
Securities at a future date in accordance with Article III.
SECTION 8.03. Application of Trust Money. The Trus-
tee (or such other trustee, if any) shall hold in trust money
or U.S. Government Obligations deposited with it pursuant to
this Article VIII. It shall apply the deposited money and the
money from U.S. Government Obligations through the Paying Agent
and in accordance with this Indenture to the payment of princi-
pal of and interest, if any, on the Securities.
SECTION 8.04. Repayment to the Company. The Trustee
(or such other trustee, if any) and the Paying Agent shall
promptly pay to the Company upon written request any excess
money or U.S. Government Obligations held by them at any time.
The Trustee (or such other trustee, if any) and the Paying
Agent shall return to the Company upon written request any
money held by them for the payment of any amount with respect
to the Securities that remains unclaimed for two years; pro-
vided, however, that the Trustee (or such other trustee, if
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any) or such Paying Agent, before being required to make such
return, may, in the name and at the expense of the Company,
cause to be published once in a daily newspaper of national
circulation or mail to each such Holder notice that such money
or securities remains unclaimed and that, after a date speci-
fied therein, which shall not be less than 30 days from the
date of such mailing, any unclaimed money or securities then
remaining will be returned to the Company. After return to the
Company, Holders entitled to the money must look to the Company
for payment as general creditors unless an applicable abandoned
property law designates another Person, and all liability of
the Trustee, such other trustee (if any) and such Paying Agent
with respect to such money shall cease.
SECTION 8.05. Indemnity for Government Obligations.
The Company shall pay and shall indemnify the Trustee (and such
other trustee, if any) against any tax, fee or other charges
imposed on or assessed against U.S. Government Obligations or
the principal and interest received on such U.S. Government
Obligations.
SECTION 8.06. Reinstatement. If the Trustee, other
trustee (if any) or Paying Agent is unable to apply any money
or U.S. Government Obligations in accordance with this Article
VIII by reason of any legal proceeding or by reason of any
order or judgment of any court or governmental authority
enjoining, restraining or otherwise prohibiting such applica-
tion, the Company's obligations under this Indenture and the
Securities shall be revived and reinstated as though no deposit
had occurred pursuant to this Article VIII until such time as
the Trustee, such other trustee (if any) or Paying Agent is
permitted to apply all such money or U.S. Government Obliga-
tions in accordance with this Article VIII; provided that, if
the Company has made any payment of interest, if any, on or
principal of any Securities because of the reinstatement of its
obligations, the Company shall be subrogated to the rights of
the Holders of such Securities to receive such payment from the
money or U.S. Government Obligations held by the Trustee, such
other trustee (if any) or Paying Agent.
ARTICLE 9
AMENDMENTS
SECTION 9.01. Without Consent of Holders. The Com-
pany and the Trustee, without notice to or the consent of the
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holders of the Securities issued hereunder, may amend or sup-
plement this Indenture and/or the Securities as follows:
(1) to cure any ambiguity, defect or inconsistency;
(2) to comply with Article 5 hereof; or
(3) to provide for uncertificated Securities in
addition to or in place of certificated Securities so long as
such uncertificated Securities are in registered form for pur-
poses of the Internal Revenue Code of 1986, as amended; or
(4) to make any other change that would provide any
additional rights or benefits of any Securityholder or that
does not adversely affect the rights under this Indenture of
any Securityholder; or
(5) to comply with any requirement of the SEC in
connection with the qualification of this Indenture under the
TIA.
SECTION 9.02. With Consent of Holders. With the
written consent of the Holders of at least a majority in aggre-
gate principal amount of the Securities at the time outstand-
ing, the Company and the Trustee may, except as provided below,
amend this Indenture and/or the Securities or may waive any
existing default or compliance by the Company with any provi-
sions of this Indenture or the Securities. However, without
the consent of each Securityholder affected, a waiver or an
amendment to this Indenture or the Securities may not:
(1) reduce the aggregate principal amount of Securi-
ties whose Holders must consent to an amendment or waiver; or
(2) reduce the principal of or change the fixed
maturity of any Securities or alter the redemption provisions
with respect thereto; or
(3) reduce the rate of or change the time for pay-
ments of interest on the Securities; or
(4) make any change in the provisions of Section
4.15 or 4.16; or
(5) waive a default in the payment of the principal,
premium, if any, or interest on, any Securities;
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(6) make any Securities payable in money other than
that stated in the Securities;
(7) make any change in the provisions of this Inden-
ture relating to waivers of past Defaults or the rights of
Holders of Securities to receive payments of principal of, pre-
mium, if any, or interest on the Securities; or
(8) make any change in Article 10 that adversely
affects the Holder of the Securities or any other change to
this Indenture that adversely affects the rights of the Holders
of the Securities under Article 10; or
(9) make any change in the foregoing provisions of
this Section 9.02.
It shall not be necessary for the consent of the
Holders under this Section 9.02 to approve the particular form
of any proposed amendment, but it shall be sufficient if such
consent approves the substance thereof.
In the event that certain Holders are willing to
defer or waive certain obligations of the Company hereunder
with respect to Securities held by them, such deferral or
waiver shall not be deemed to affect any other Holder who
receives the subject payment or performance in a timely manner.
After an amendment or waiver under this Section 9.02
becomes effective, the Company shall mail to each Holder a
notice briefly describing the amendment or waiver. Any failure
of the Company to mail such notice, or any defect therein,
shall not, however, in any way impair or affect the validity of
any such amendment or waiver.
SECTION 9.03. Compliance with Trust Indenture Act.
Every supplemental indenture executed pursuant to this Article
9 shall comply with the TIA.
SECTION 9.04. Revocation and Effect of Consents,
Waivers and Actions. Until an amendment, waiver or other
action by Holders becomes effective, a consent to it or any
other action by a Holder of a Security hereunder is a continu-
ing consent by the Holder and every subsequent Holder of that
Security or portion of the Security that evidences the same
obligation as the consenting Holder's Security, even if nota-
tion of the consent, waiver or action is not made on the Secu-
rity. However, any such Holder or subsequent Holder may revoke
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the consent, waiver or action as to such Holder's Security or
portion of the Security if the Trustee receives the notice of
revocation before the consent of the requisite aggregate prin-
cipal amount of the Securities then outstanding has been
obtained and not revoked. After an amendment, waiver or action
becomes effective, it shall bind every Securityholder and every
subsequent Holder thereof, except as provided in Section 9.02
hereof.
The Company or the Trustee may, pursuant to Section
1.05(e), but shall not be obligated to, fix a record date for
the purpose of determining the Holders entitled to consent to
any amendment or waiver. If a record date is fixed, then, not-
withstanding the first two sentences of the immediately preced-
ing paragraph, those Persons who were Holders at such record
date (or their duly designated proxies), and only those Per-
sons, shall be entitled to consent to such amendment, supple-
ment or waiver or to revoke any consent previously given,
whether or not such Persons continue to be Holders after such
record date. No such consent shall be valid or effective for
more than 90 days after such record date.
SECTION 9.05. Notation on or Exchange of Securities.
Securities authenticated and made available for delivery after
the execution of any supplemental indenture pursuant to this
Article 9 may, and shall, if required by the Trustee, bear a
notation in form approved by the Trustee as to any matter pro-
vided for in such supplemental indenture. If the Company or
the Trustee shall so determine, new Securities so modified as
to conform, in the opinion of counsel satisfactory to the Trus-
tee and the Board of Directors of the Company, to any such sup-
plemental indenture may be prepared and executed by the Company
and authenticated and made available for delivery by the Trus-
tee in exchange for outstanding Securities.
SECTION 9.06. Trustee to Sign Supplemental Inden-
tures. The Trustee shall sign any supplemental indenture
authorized pursuant to this Article 9 if the supplemental
indenture does not adversely affect the rights, duties, liabil-
ities or immunities of the Trustee. If it does, the Trustee
may, but need not, sign it. In signing such amendment the
Trustee shall be entitled to receive, and shall be fully pro-
tected in relying upon, an Officers' Certificate and Opinion of
Counsel stating that such supplemental indenture is authorized
or permitted by this Indenture.
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SECTION 9.07. Effect of Supplemental Indentures.
Upon the execution of any supplemental indenture under this
Article 9, this Indenture shall be modified in accordance
therewith, and such supplemental indenture shall form a part of
this Indenture for all purposes; and every Holder of Securities
theretofore or thereafter authenticated and made available for
delivery hereunder shall be bound thereby.
ARTICLE 10
SUBORDINATION
SECTION 10.01. Agreement to Subordinate; Certain
Definitions.
(a) The Company agrees, and each Securityholder by
accepting a Security consents and agrees, that the Indebtedness
evidenced by the Security is subordinated in right of payment,
to the extent and in the manner provided in this Article, to
the prior payment in full of all existing and future Senior
Debt (including, without limitation, the Senior Notes and bor-
rowings under the New Credit Facility), and that the subordina-
tion is for the benefit of the holders of Senior Debt.
(b) Certain Definitions:
"Designated Senior Debt" means all Obligations of the
Company under the New Credit Facility, the Senior Notes and the
Senior Note Indenture and any other Senior Debt permitted under
this Indenture, the principal amount of which is $50 million or
more that has been designated by the Company by a resolution of
its Board of Directors as Designated Senior Debt.
"Senior Debt" means any Indebtedness of the Company
(including any interest accruing subsequent to the filing of a
petition of bankruptcy at the rate provided for in the documen-
tation with respect thereto, to the extent such interest is an
allowed claim under applicable law), whether outstanding on the
date of this Indenture or thereafter created, incurred or
assumed, unless, in the case of any particular Indebtedness,
the instrument creating or evidencing the same or pursuant to
which the same is outstanding expressly provides that such
Indebtedness shall not be senior in right of payment to the
Securities. Notwithstanding the foregoing, Senior Debt shall
not include: (i) any Indebtedness of the Company to a Subsid-
iary of the Company; (ii) any Indebtedness to, or guaranteed on
behalf of, any Affiliate, director, officer or employee of the
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Company or any Subsidiary (including, without limitation,
amounts owed for compensation); (iii) Indebtedness and other
amounts incurred in connection with obtaining goods, materials
or services owing to trade creditors; (iv) Disqualified Stock;
(v) any liability for federal, state, local or other taxes owed
or owing by the Company; (vi) Indebtedness incurred in viola-
tion of the provisions of Section 4.09 hereof; and (vii) any
Indebtedness which is, by its express terms, junior in right of
payment to any other Indebtedness of the Company.
SECTION 10.02. Liquidation; Dissolution; Bankruptcy.
Upon any payment or distribution of assets to creditors of the
Company upon any dissolution or winding up or total or partial
liquidation or reorganization of the Company whether voluntary
or involuntary or in a bankruptcy, reorganization, insolvency,
receivership or similar proceeding relating to the Company or
its property, in an assignment for the benefit of creditors or
any marshalling of the Company's assets and liabilities:
(1) the holders of Senior Debt of the Company will
first be entitled to receive payment in full in cash of all
Obligations due in respect of such Senior Debt (including
interest accruing after or which would accrue but for the
occurrence of the commencement of any such proceeding, at the
rate specified in the applicable Senior Debt whether or not
such interest is an allowable claim in any such proceeding)
before any payment or distribution is made on account of any
Obligations on the Securities, or for the acquisition of any of
the Securities for cash or property or otherwise; and
(2) until all Obligations with respect to Senior
Debt of the Company (as provided in clause (1) above) are paid
in full in cash, any distribution to which the Holders of the
Securities otherwise would be entitled but for this Article
shall be made to the holders of Senior Debt, except that Hold-
ers of the Securities may receive securities that are subordi-
nated at least to the same extent as the Securities to (a)
Senior Debt and (b) any securities issued in exchange for
Senior Debt ("subordinated securities").
For purposes of this Article 10, a distribution may
consist of cash, securities or other property, by setoff or
otherwise.
The consolidation of the Company with, or the merger
of the Company into, another corporation or the liquidation or
dissolution of the Company following the conveyance or transfer
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of its properties and assets substantially as an entirety to
another Person upon the terms and conditions set forth in
Article 5 hereof shall not be deemed a dissolution, winding up,
liquidation or reorganization for the purposes of this Section
10.02 if the Surviving Corporation complies with the conditions
set forth in Article 5 hereof.
SECTION 10.03. Default on Senior Debt.
(a) Upon the final maturity of any Senior Debt by
lapse of time, acceleration or otherwise, all Senior Debt shall
first be paid in full in cash or cash equivalents, or such pay-
ment duly provided for in cash or Cash Equivalents or in a man-
ner satisfactory to the holders of such Senior Debt, before any
payment is made by the Company or any person acting on behalf
of the Company of the principal, premium, if any, or interest
on the Securities.
(b) The Company may not make any payment upon or
distribution in respect of the Securities or acquire any of the
Securities for cash or property or otherwise (except in or for
such subordinated securities) if (i) a default in the payment
of the principal, premium, if any, or interest on Senior Debt
occurs and is continuing beyond any applicable period of grace
(whether upon maturity, at a date fixed for prepayment, as a
result of acceleration or otherwise) (a "payment default") or
(ii) any other default occurs and is continuing (or if such an
event of default would occur upon any payment with respect to
the Securities or would arise upon the passage of time as a
result of such payment) with respect to any Designated Senior
Debt that permits holders of the Designated Senior Debt as to
which such default relates to accelerate its maturity (a
"non-payment default") and, in either case, the Trustee
receives a notice of such non-payment default (a "payment
blockage notice") from the holders, or from the trustee, agent
or other representative of the holders, of any such Designated
Senior Debt.
(c) Payments on the Securities may and shall be
resumed (i) in the case of a payment default, upon the date on
which such default is cured or waived, and (ii) in the case of
a nonpayment default, the earlier of the date on which such
nonpayment default is cured or waived or 179 days after the
date on which the applicable payment blockage notice is
received, unless the maturity of any Designated Senior Debt has
been accelerated (with respect to a nonpayment default such
period of time shall be hereinafter referred to as a "payment
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blockage period"). No payment blockage period may be commenced
within 360 days after receipt by the Trustee of any prior pay-
ment blockage notice. No nonpayment default that existed or
was continuing on the date of delivery of any payment blockage
period to the Trustee shall be made the basis for a subsequent
payment blockage notice unless such default shall have been
cured or waived for a period of not less than 180 days and all
scheduled payments of principal, premium, if any, and interest
then due and payable on the Securities shall have been made.
SECTION 10.04. No Suspension of Remedies. Nothing
contained in this Article 10 shall limit the right of the Trus-
tee or the Holders of Securities to take any action to acceler-
ate the maturity of the Securities pursuant to Section 6.02
hereof or to pursue any other rights or remedies hereunder or
under applicable law; provided, however, that all Senior Debt
of the Company then due and payable, or which thereafter is
declared to be, or shall otherwise become, due and payable,
pursuant to its terms (whether by acceleration or otherwise)
shall first be paid in full in cash or Cash Equivalents before
the Holders or the Trustee are entitled to receive any payment
from the Company of principal, premium, if any, or interest on
the Securities. If payment of the Securities is accelerated
because of an Event of Default, the Company shall promptly
notify holders of Senior Debt of the acceleration.
SECTION 10.05. When Distributions Must Be Paid Over.
In the event that the Trustee or any Securityholder receives
any payment of any Obligations with respect to the Securities
at a time when a Trustee or such Securityholder has actual
knowledge such payment is prohibited by Section 10.02 or 10.03
hereof, such payment shall be held by the Trustee or such
Securityholder in trust for the benefit of, and shall be paid
forthwith over and delivered, upon written request, to, the
holders of Senior Debt as their interests may appear or their
agent or representative or the trustee under the indenture or
other agreement (if any) pursuant to which Senior Debt may have
been issued, as their respective interests may appear, for
application to the payment of all Obligations with respect to
Senior Debt remaining unpaid to the extent necessary to pay
such Obligations in full in accordance with their terms, after
giving effect to any concurrent payment or distribution to or
for the holders of Senior Debt.
If a distribution is made to the Trustee or any
Securityholder that because of this Article 10 should not have
been made to it, the Trustee or such Securityholder who
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receives the distribution, upon notice that such distribution
should not have been made, shall hold it in trust for the bene-
fit of, and, upon written request, pay it over to, the holders
of Senior Debt as their interests may appear, or their agent or
representative or the trustee under the indenture or other
agreement (if any) pursuant to which Senior Debt may have been
issued, as their respective interests may appear, for applica-
tion to the payment of all Obligations with respect to Senior
Debt remaining unpaid to the extent necessary to pay such Obli-
gations in full in accordance with their terms, after giving
effect to any concurrent payment or distribution to or for the
holders of Senior Debt.
With respect to the holders of Senior Debt, the Trus-
tee undertakes to perform only such obligations on the part of
the Trustee as are specifically set forth in this Article 10,
and no implied covenants or obligations with respect to the
holders of Senior Debt shall be read into this Indenture
against the Trustee. The Trustee shall not be deemed to owe
any fiduciary duty to the holders of Senior Debt, and shall not
be liable to any such holders if the Trustee shall pay over or
distribute to or on behalf of Securityholders or the Company or
any other person money or assets to which any holders of Senior
Debt shall be entitled by virtue of this Article 10, except if
such payment is made as a result of the willful misconduct or
negligence of the Trustee.
SECTION 10.06. Notice by Company. The Company shall
promptly notify the Trustee and the Paying Agent of any facts
known to the Company that would cause a payment of any Obliga-
tions with respect to the Securities to violate this Article,
but failure to give such notice shall not affect the subordina-
tion of the Securities to the Senior Debt provided in this
Article 10.
SECTION 10.07. Subrogation. After all Senior Debt
is paid in full and until the Securities are paid in full,
Securityholders shall be subrogated (equally and ratably with
all other Indebtedness pari passu with the Securities) to the
rights of holders of Senior Debt to receive distributions
applicable to Senior Debt to the extent that distributions
otherwise payable to the Securityholders have been applied to
the payment of Senior Debt. A distribution made under this
Article to holders of Senior Debt which otherwise would have
been made to Securityholders is not, as between the Company and
Securityholders, a payment by the Company on the Senior Debt.
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SECTION 10.08. Relative Rights. This Article
defines the relative rights of Securityholders and holders of
Senior Debt. Nothing in the Indenture shall:
(1) impair, as between the Company and
Securityholders, the obligation of the Company, which is abso-
lute and unconditional, to pay principal of and interest on the
Securities in accordance with their terms;
(2) affect the relative rights of Securityholders
and creditors of the Company other than their rights in rela-
tion to holders of Senior Debt; or
(3) prevent the Trustee or any Securityholder from
exercising its available remedies upon a Default or Event of
Default, subject to the rights of holders and owners of Senior
Debt to receive distributions and payments otherwise payable to
Securityholders.
If the Company fails because of this Article to pay
principal of or interest on a Security on the due date, the
failure is still a Default or Event of Default.
SECTION 10.09. Subordination May Not Be Impaired by
Company. No right of any holder of Senior Debt to enforce the
subordination of the indebtedness evidenced by the Securities
shall be impaired by any act or failure to act by the Company
or by its failure to comply with this Indenture.
SECTION 10.10. Distribution or Notice to Representa-
tive.
Whenever a distribution is to be made or a notice
given to holders of Senior Debt, the distribution may be made
and the notice given to their Representative. Upon any payment
or distribution of assets of the Company referred to in this
Article 10, the Trustee and the Securityholders shall be enti-
tled to rely upon any order or decree made by any court of com-
petent jurisdiction or upon any certificate of such Representa-
tive or of the liquidating trustee or agent or other person
making any distribution to the Trustee or to the
Securityholders for the purpose of ascertaining the persons
entitled to participate in such distribution, the holders of
the Senior Debt and other Indebtedness of the Company, the
amount thereof or payable thereon, the amount or amounts paid
or distributed thereon and all other facts pertinent thereto or
to this Article 10.
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SECTION 10.11. Rights of Trustee and Paying Agent.
Notwithstanding the provisions of this Article 10 or
any other provision of this Indenture, the Trustee shall not be
charged with knowledge of the existence of any facts which
would prohibit the making of any payment or distribution by the
Trustee, or the taking of any action by the Trustee, and the
Trustee or Paying Agent may continue to make payments on the
Securities unless an Officer of the Trustee shall have received
at least five Business Days prior to the date of such payment
written notice of facts that would cause the payment of any
Obligations with respect to the Securities to violate this
Article. Only the Company, a Representative or a holder of an
issue of Senior Debt that has no Representative may give the
notice. Nothing in this Article 10 shall apply to amounts due
to, or impair the claims of, or payments to, the Trustee under
or pursuant to Section 7.07 hereof.
The Trustee in its individual or any other capacity
may hold Senior Debt with the same rights it would have if it
were not Trustee.
SECTION 10.12. Authorization to Effect Subordina-
tion. Each Securityholder by his acceptance thereof authorizes
and directs the Trustee on his behalf to take such action as
may be necessary or appropriate to effectuate the subordination
as provided in this Article 10, and appoints the Trustee his
attorney-in-fact for any and all such purposes.
ARTICLE 11
MISCELLANEOUS
SECTION 11.01. Trust Indenture Act Controls. If any
provision of this Indenture limits, qualifies or conflicts with
the duties imposed by operation of subsection (c) of Section
318 of the TIA, the imposed duties shall control. The provi-
sions of Sections 310 to 317, inclusive, of the TIA that impose
duties on any Person (including provisions automatically deemed
included in an indenture unless the indenture provides that
such provisions are excluded) are a part of and govern this
Indenture, except as, and to the extent, expressly excluded
from this Indenture, as permitted by the TIA.
SECTION 11.02. Notices. Any notice or communication
shall be in writing and delivered in person or mailed by
first-class mail, postage prepaid, addressed as follows:
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if to the Company:
Sequa Corporation
200 Park Avenue
New York, New York 10166
Attention: Treasurer
if to the Trustee:
Bankers Trust Company
4 Albany Street, 4th Floor
New York, New York 10006
Attention: Corporate Trust and Agency Group
The Company or the Trustee, by notice to the others,
may designate additional or different addresses for subsequent
notices or communications.
Any notice or communication given to a Securityholder
shall be mailed to the Securityholder at the Securityholder's
address as it appears on the registration books of the Regis-
trar and shall be sufficiently given if so mailed within the
time prescribed.
Failure to mail a notice or communication to a
Securityholder or any defect in it shall not affect its suffi-
ciency with respect to other Securityholders. If a notice or
communication is mailed in the manner provided above, it is
duly given, whether or not received by the addressee.
If the Company mails a notice or communication to the
Securityholders, it shall mail a copy to the Trustee and each
Registrar, Paying Agent or co-registrar.
SECTION 11.03. Communication by Holders with Other
Holders. Securityholders may communicate pursuant to TIA Sec-
tion 312(b) with other Securityholders with respect to their
rights under this Indenture or the Securities. The Company,
the Trustee, the Registrar, the Paying Agent and anyone else
shall have the protection of TIA Section 312(c).
SECTION 11.04. Certificate and Opinion as to Condi-
tions Precedent. Upon any request or application by the Com-
pany to the Trustee to take any action under this Indenture,
the Company shall furnish to the Trustee:
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(1) an Officers' Certificate stating that, in the
opinion of the signers, all conditions precedent, if any, pro-
vided for in this Indenture relating to the proposed action
have been complied with; and
(2) an Opinion of Counsel stating that, in the opin-
ion of such counsel, all such conditions precedent have been
complied with.
SECTION 11.05. Statements Required in Certificate or
Opinion. Each Officers' Certificate and Opinion of Counsel
with respect to compliance with a covenant or condition pro-
vided for in this Indenture shall include:
(1) a statement that each Person making such Offic-
ers' Certificate or Opinion of Counsel has read such covenant
or condition;
(2) a brief statement as to the nature and scope of
the examination or investigation upon which the statements or
opinions contained in such Officers' Certificate or Opinion of
Counsel are based;
(3) a statement that, in the opinion of each such
Person, he has made such examination or investigation as is
necessary to enable such Person to express an informed opinion
as to whether or not such covenant or condition has been com-
plied with; and
(4) a statement that, in the opinion of such Person,
such covenant or condition has been complied with.
SECTION 11.06. Separability Clause. In case any
provision in this Indenture or in the Securities shall be
invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any way
be affected or impaired thereby.
SECTION 11.07. Rules by Trustee, Paying Agent and
Registrar. The Trustee may make reasonable rules for action by
or a meeting of Securityholders. The Registrar and Paying
Agent may make reasonable rules for their functions.
SECTION 11.08. Legal Holidays. A "Legal Holiday" is
any day other than a Business Day. If any specified date
(including a date for giving notice) is a Legal Holiday, the
action shall be taken on the next succeeding day that is not a
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Legal Holiday, and, if the action to be taken on such date is a
payment in respect of the Securities, no principal, premium, if
any, or interest installment shall accrue for the intervening
period.
SECTION 11.09. GOVERNING LAW AND CHOICE OF FORUM.
THIS INDENTURE AND THE SECURITIES SHALL BE GOVERNED BY AND CON-
STRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, AS
APPLIED TO CONTRACTS MADE AND PERFORMED WITHIN THE STATE OF NEW
YORK, WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAWS. IF
ANY ACTION OR PROCEEDING SHALL BE BROUGHT BY THE TRUSTEE OR BY
A HOLDER OF ANY OF THE SECURITIES IN ORDER TO ENFORCE ANY RIGHT
OR REMEDY UNDER THIS INDENTURE OR UNDER THE SECURITIES, THE
COMPANY HEREBY CONSENTS AND SUBMITS TO THE JURISDICTION OF THE
COURTS OF THE STATE OF NEW YORK AND OF ANY FEDERAL COURT SIT-
TING IN THE CITY OF NEW YORK, STATE OF NEW YORK. ANY ACTION OR
PROCEEDING BROUGHT BY THE COMPANY TO ENFORCE ANY RIGHT, ASSERT
ANY CLAIM OR OBTAIN ANY RELIEF WHATSOEVER IN CONNECTION WITH
THIS INDENTURE OR THE SECURITIES SHALL BE BROUGHT BY THE COM-
PANY EXCLUSIVELY IN THE COURTS OF THE STATE OF NEW YORK OR IN
ANY FEDERAL COURT SITTING IN THE CITY OF NEW YORK, STATE OF NEW
YORK.
SECTION 11.10. No Recourse Against Others. A direc-
tor, officer, employee or stockholder, as such, of the Company
shall not have any liability for any obligations of the Company
under the Securities or this Indenture or for any claim based
on, in respect of or by reason of such obligations or their
creation. By accepting a Security, each Securityholder shall
waive and release all such liability. The waiver and release
shall be part of the consideration for the issue of the
Securities.
SECTION 11.11. Successors. All agreements of the
Company in this Indenture, and the Securities shall bind their
respective successors. All agreements of the Trustee in this
Indenture shall bind its successors.
SECTION 11.12. Multiple Originals. The parties may
sign any number of copies of this Indenture. Each signed copy
shall be an original, but all of them together represent the
same agreement. One signed copy is enough to prove this
Indenture.
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SIGNATURES
IN WITNESS WHEREOF, the undersigned, being duly
authorized, have executed this Indenture on behalf of the
respective parties hereto as of the date first above written.
SEQUA CORPORATION
By /s/ Kenneth A. Drucker ATTEST: /s/ Ira A. Schreger
Name: Kenneth A. Drucker
(Seal)
Title: Vice President and
Treasurer
BANKERS TRUST COMPANY, as trustee
By /s/ Susan Johnson ATTEST: /s/ Wanda Camacho
Name: Susan Johnson
(Seal)
Title: Assistant Vice
President
