As filed with the Securities and Exchange Commission on October 23, 1998
Registration No. 333-
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SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
----------------
FORM S-3
REGISTRATION STATEMENT
under
THE SECURITIES ACT OF 1933
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Sequa Corporation
(Exact name of registrant as specified in its charter)
Delaware 13-1885030
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
200 Park Avenue
New York, New York 10166
(212) 986-5500
(Address, including zip code, and telephone number, including
area code, of registrant's principal executive offices)
----------------
Norman E. Alexander
Chairman of the Board and Chief Executive Officer
Sequa Corporation
200 Park Avenue
New York, New York 10166
(212) 986-5500
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
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Copy to:
W. Leslie Duffy, Esq.
Cahill Gordon & Reindel
80 Pine Street
New York, New York 10005
(212) 701-3000
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Approximate date of commencement of proposed sale to the public: From time
to time after the effective date of this Registration Statement.
If the only securities being registered on this Form are being offered pursuant
to dividend or interest reinvestment plans, please check the following box. |_|
If any of the securities being registered on this Form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. |X|
If this Form is filed to register additional securities for an offering pursuant
to Rule 462(b) under the Securities Act, please check the following box and list
the Securities Act registration statement number of the earlier effective
registration statement for the same offering. |_|
If this Form is a post-effective amendment filed pursuant to Rule 462(c) under
the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. |_|
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. |_|
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CALCULATION OF REGISTRATION FEE
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Title of each class of securities to be Proposed maximum aggregate offering price* Amount of registration fee
registered
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<S> <C> <C>
Debt Securities..... $500,000,000 (1) $139,000.00
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</TABLE>
* Estimated solely for the purpose of calculating the registration fee.
(1) In no event will the aggregate initial offering price of all securities
issued from time to time pursuant to this Registration Statement exceed
$500,000,000. If any such securities are issued at an original discount,
then the aggregate initial offering price as so discounted shall not exceed
$ 500,000,000, notwithstanding that the stated principal amount of such
securities may exceed such amount.
The registrant hereby amends this registration statement on such date or
dates as may be necessary to delay its effective date until the Registrant shall
file a further amendment which specifically states that this Registration
Statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until the Registration Statement shall become
effective on such date as the Securities and Exchange Commission, acting
pursuant to said Section 8(a), may determine.
===============================================================================
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The information in this prospectus is not complete and may be changed. We may
not sell these securities until the registration statement filed with the
Securities and Exchange Commission is effective. This prospectus is not an offer
to sell these securities and it is not soliciting an offer to buy these
securities in any state where the offer or sale is not permitted.
PROSPECTUS
$500,000,000
Sequa Corporation
Debt Securities
----------------------
Sequa Corporation may offer at various times debt securities in one or more
series worth up to $500,000,000 aggregate principal amount. The terms of the
debt securities will be determined at the time or times of sale. A prospectus
supplement will be delivered each time that debt securities are offered and will
describe the following: the series designation, aggregate principal amount,
maturity or maturities, rate or rates and times of payment of interest,
redemption terms, any sinking fund terms, any conversion terms and any other
special terms of the offered securities.
The Company may sell debt securities to or through underwriters or dealers
and also may sell debt securities directly to other purchasers or through
agents. The prospectus supplement relating to each series of debt securities
will set forth the terms of the offering of the debt securities, including, to
the extent applicable, the initial offering price, the proceeds to the Company,
the underwriting discounts or commissions, and any other discounts or
concessions to be allowed or re-allowed to dealers. The principal underwriters
with respect to each series sold to or through underwriters will be named in the
prospectus supplement relating to such series. See "Plan of Distribution."
----------------------
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of the securities or passed upon the
adequacy or accuracy of the prospectus. Any representation to the contrary is a
criminal offense.
----------------------
, 1998.
<PAGE>
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed by the Company with the Securities and
Exchange Commission (the "Commission") are incorporated herein by reference as
of their respective dates of filing and shall be deemed to be a part hereof:
1. The Company's Annual Report on Form 10-K (File No. 1-804) for the year
ended December 31, 1997 (the "Company's 1997 Form 10-K").
2. The Company's Current Report on Form 8-K (File No. 1-804) filed
September 10, 1998.
3. The Company's Quarterly Reports on Form 10-Q (File No. 1-804) filed May
14, 1998 and August 13, 1998.
4. The Company's Proxy Statement on Schedule 14A (File No. 1-804) filed
March 30, 1998.
All documents filed by the Company pursuant to Sections 13(a), 13(c), 14,
or 15(d) of the 1934 Act after the date of this prospectus and prior to the
termination of this offering shall also be deemed to be incorporated by
reference in this prospectus and to be a part hereof from the date of filing of
such documents. Any statement contained in a document incorporated or deemed to
be incorporated by reference herein shall be deemed to be modified or superseded
for purposes of this prospectus to the extent that a statement herein or in any
other subsequently filed document which also is or is deemed to be incorporated
by reference herein modifies or supersedes such statement. Any such statement so
modified or superseded shall not be deemed, except as so modified or superseded,
to constitute a part of this prospectus .
The Company hereby undertakes to provide without charge to each person,
including any beneficial owner, to whom a copy of this prospectus has been
delivered, on the written or oral request of any such person, a copy of any or
all documents referred to above which have been or may be incorporated by
reference in this prospectus (not including exhibits to such incorporated
information that are not specifically incorporated by reference into such
information). Requests for such copies should be directed to the Company, 200
Park Avenue, New York, New York 10166, Attention: Treasurer (212) 986-5500.
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THE COMPANY
The Company is a diversified industrial corporation that produces a broad
range of products through operating units in four industry segments: Aerospace,
Machinery and Metal Coatings, Specialty Chemicals, and Other Products.
Aerospace
The Aerospace segment includes two operating units: Chromalloy Gas Turbine
and ARC Propulsion. Chromalloy Gas Turbine, the largest of Sequa's operating
units, repairs and manufactures components for jet aircraft engines. Gas Turbine
provides domestic and international airlines with technologically advanced
repairs and coatings for turbine airfoils and other critical engine components.
The unit also supplies components to the manufacturers of jet engines and serves
both the general aviation and military markets. ARC Propulsion, a supplier of
solid rocket fuel propulsion systems since 1949, is a leading developer and
manufacturer of advanced rocket propulsion systems, gas generators and auxiliary
rockets. For the military contract market, ARC Propulsion produces propulsion
systems for tactical weapons, and for space applications, ARC Propulsion
produces small liquid fueled rocket engines designed to provide attitude and
orbit control for a number of satellite systems worldwide. ARC Propulsion's
commercial market presence derives from its pioneering development of hybrid
inflator systems for automotive airbags and production of energetic materials
for airbag deployment. In early 1998, ARC Propulsion moved to further its role
in the automotive market through the purchase of its partner's share of a
venture that produces airbag inflators.
Machinery and Metal Coatings
The Company's Machinery and Metal Coatings segment is composed of Precoat
Metals, Sequa Can Machinery and MEGTEC Systems. Precoat Metals, the largest
individual unit of the segment, is a leader in the application of protective and
decorative coatings to continuous steel and aluminum coil. Precoat Metals'
principal market is the building products industry, where coated steel is used
for the construction of pre-engineered building systems, and as components in
the industrial, commercial, agricultural and residential sectors. Precoat Metals
also serves the container industry and has established a presence in other
product markets, including heating, ventilating and air conditioning units,
truck trailer panels and office equipment. Sequa Can Machinery designs and
manufactures equipment for the two-piece can industry. At a facility on the East
Coast, Sequa Can Machinery manufactures high-speed equipment to coat and
decorate two-piece beverage cans, and at its West Coast plant, Sequa Can
Machinery produces equipment used to form the cup and body of two-piece metal
cans. MEGTEC Systems, which was formed in 1997, supplies equipment for the web
offset printing industry, including pasters and splicers, web guides, infeeds,
chill stands and related equipment for high-speed web presses. MEGTEC's products
also include air flotation dryers for paper and printing uses and emission
control systems for industrial applications.
Specialty Chemicals
The two operations that make up the Company's Specialty Chemicals segment,
Warwick International and Sequa Chemicals, serve distinctly different markets
with performance-enhancing additives for a broad range of end products. Warwick
International, the larger of the two businesses in the Specialty Chemicals
segment, is a leading producer and supplier of TAED, a bleach activator for
powdered laundry detergent products. The unit also markets and distributes
diverse chemical products including plastics, resins, paints and cosmetics.
Sequa Chemicals manufactures high-quality performance-enhancing chemicals for
the paper, textile and other industries.
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Sequa Chemicals (i) produces key synthetic coating additives for coated papers
including Reactopaque(R), which increases the opacity of finished paper
primarily used by the newsprint industry, (ii) supplies the woven and knit
fabric market with permanent press resins, softeners, water repellents, soil
release agents and other chemicals to improve the look, feel and durability of
clothing and other textiles and (iii) has developed and patented a unique series
of specialty emulsion polymers for a broad range of commercial applications.
Other Products
The Other Products segment includes three primary businesses: Casco
Products, the men's apparel unit and Northern Can Systems. Casco Products, which
has been serving the automotive products market since 1921, is the world's
leading supplier of automotive cigarette lighters and also offers a growing line
of automotive accessories. The men's apparel unit designs and manufactures men's
formalwear and accessories marketed under the labels Raffinati, Oscar de la
Renta and After Six. Northern Can Systems, which was sold in December 1997,
supplied the domestic and international food processing market with easy-open
lids for cans.
Available Information
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "1934 Act"), and in accordance therewith
files reports and other information with the Securities and Exchange Commission
(the "Commission"). Reports, proxy and information statements, and other
information filed by the Company, can be inspected and copied at the public
reference facilities maintained by the Commission at 450 Fifth Street, N.W.,
Washington, D.C. 20549 and at certain of its Regional Offices at Seven World
Trade Center, 13th Floor, New York, N.Y. 10048 and Citicorp Center, 500 West
Madison Street, Suite 1400, Chicago, IL 60661. Copies of such material can be
obtained at prescribed rates from the Public Reference Section of the
Commission, 450 Fifth Street, N.W., Washington, D.C. 20549 and by accessing the
Commission's Web site, http://www.sec.gov. The public may obtain information on
the operation of the Public Reference Room by calling the Commission at (800)
SEC-0330. Certain securities of the Company are listed on the New York Stock
Exchange (the "NYSE"), and reports, proxy statements and other information
concerning the Company can be inspected at the offices of such Exchange, 20
Broad Street, New York, N.Y. 10005.
The Company's principal executive offices are located at 200 Park Avenue,
New York, New York 10166 (telephone (212) 986-5500).
USE OF PROCEEDS
The net proceeds from the sale of the debt securities (the "Debt
Securities") will be added to the general funds of the Company to be used for
repayment of indebtedness and general corporate purposes. Information concerning
the use of proceeds from the sale of each series of the Debt Securities will be
set forth in the prospectus supplement relating to such series.
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RATIO OF EARNINGS TO FIXED CHARGES
The following table sets forth the Company's ratio of earnings to fixed
charges for each year in the five-year period ended December 31 and for the six
month period ended June 30, 1998.
<TABLE>
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Year Ended December 31, Six Months Ended
1993 1994 1995 1996 1997 June 30, 1998
---- ---- ---- ---- ---- -------------
<S> <C> <C> <C> <C> <C> <C>
Ratio of Earnings to Fixed Charges: N/A N/A 1.5x 1.4x 1.7x 2.2x
</TABLE>
The ratio of earnings to fixed charges has been computed by dividing
earnings by fixed charges. Earnings consist of income (loss) before income
taxes, extraordinary items and fixed charges and after adjustments for minority
interests in the earnings and losses of majority-owned subsidiaries and after
adjustments for equity in the earnings and losses of less than fifty percent
owned joint ventures. Fixed charges consist of interest expense on all
indebtedness, amortization of debt issuance costs, the portion of rental expense
representative of interest and preference stock dividend requirements of a
majority-owned subsidiary. The Company's earnings were inadequate to cover fixed
charges by $64.8 million in 1993 and $25.5 million in 1994.
DESCRIPTION OF DEBT SECURITIES
The Debt Securities will be issued in one or more series under an Indenture
(the "Indenture") between the Company and Bank of Montreal Trust Company, as
Trustee, the form of which is filed as an exhibit to the Registration Statement.
The following summaries of certain provisions of the Indenture do not purport to
be complete and are qualified in their entirety by express reference to the
Indenture and the securities resolutions or the indentures supplemental thereto
(copies of which have been or will be filed with the Commission). Capitalized
terms used in this section without definition have the meanings given such terms
in the Indenture.
General
The Indenture does not limit the amount of Debt Securities that can be
issued thereunder and provides that the Debt Securities may be issued from time
to time in one or more series pursuant to the terms of one or more securities
resolutions or supplemental indentures. As of the date of this prospectus, there
were no Debt Securities outstanding under the Indenture. The Debt Securities
will be unsecured and will rank on a parity with all other unsecured and
unsubordinated debt of the Company. The Debt Securities will be senior to all
existing and future indebtedness of the Company which by its terms is made
subordinate to the Debt Securities. Although the Indenture provides for the
possible issuance of Debt Securities in other forms or currencies, the only Debt
Securities covered by this prospectus will be Debt Securities denominated in
U.S. dollars in registered form without coupons.
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Terms
Reference is made to the prospectus supplement for the following terms, if
applicable, of the Debt Securities offered thereby:
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<S> <C>
(1) designation, aggregate principal amount, currency or (10) terms of any redemption at the option of Holders
composite currency and denominations
(11) tax indemnity provisions
(2) price and, if an index formula or other method is (12) if the Debt Securities provide that payments of
used, the method for determining amounts of principal principal or interest may be made in a currency other interest than
that in which Debt Securities are denominated, the
manner for determining such payments
(3) maturity date and other dates, if any, on which (13) portion of principal payable upon acceleration of a
principal will be payable Discounted Security (as defined below)
(4) interest rate (which may be fixed or variable), if (14) whether and upon what terms Debt Securities may
any be defeased
(5) date or dates from which interest will accrue and on (15) whether the covenant referred to below under
which interest will be payable, and the record dates for "Certain Covenants--Limitations on Liens" applies, and
the payment of interest any events of default or restrictive covenants in
addition to or in lieu of those set forth in the
Indenture
(6) manner of paying principal and interest (16) provisions for electronic issuance of Debt
Securities or for Debt Securities in uncertificated form
(7) place or places where principal and interest will be
payable
(8) terms of any mandatory or optional redemption by (17) any additional provisions or other special terms
the Company including any sinking fund not inconsistent with the provisions of the Indenture,
including any terms that may be required or advisable
(9) terms of any conversion or exchange right under United States or other applicable laws or
regulations, or advisable in connection with the
marketing of the Debt Securities. (Section 2.01)
</TABLE>
Debt Securities of any series may be issued as registered Debt Securities,
bearer Debt Securities or uncertificated Debt Securities, and in such
denominations as specified in the terms of the series. (Section 2.01)
In connection with its original issuance, no bearer Debt Security will be
offered, sold or delivered to any location in the United States, and a bearer
Debt Security in definitive form may be delivered in connection with its
original issuance only upon presentation of a certificate in a form prescribed
by the Company to comply with United States laws and regulations. (Section 2.04)
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Registration of transfer of registered Debt Securities may be requested
upon surrender thereof at any agency of the Company maintained for that purpose
and upon fulfillment of all other requirements of the agent. (Sections 2.03 and
2.07)
Securities may be issued under the Indenture as Discounted Debt Securities
to be offered and sold at a substantial discount from the principal amount
thereof. Special United States federal income tax and other considerations
applicable thereto will be described in the prospectus supplement relating to
such Discounted Debt Securities. "Discounted Debt Security" means a Debt
Security where the amount of principal due upon acceleration is less than the
stated principal amount. (Section 2.10)
Certain Covenants
The Debt Securities will not be secured by any properties or assets and
will represent senior unsecured debt of the Company.
As discussed below, the Indenture includes certain limitations on the
Company's ability to create liens which will apply only if the securities
resolution establishing the terms of a series of Debt Securities so provides (in
which event the prospectus supplement will so state). If applicable, the
limitations are subject to a number of qualifications and exceptions. The
Indenture does not limit the Company's ability to enter into sale and leaseback
transactions. In addition, the Indenture does not limit the ability of the
Company's subsidiaries to issue debt, and the Debt Securities will be
effectively subordinated to all existing and future indebtedness and other
liabilities and commitments of the Company's subsidiaries.
Unless otherwise indicated in a prospectus supplement, such covenants, if
applicable, do not afford holders of the Debt Securities protection in the event
of a highly leveraged or other transaction involving the Company that may
adversely affect holders of the Debt Securities.
Limitation on Liens
If the securities resolution establishing the terms of a series so provides
(in which event the prospectus supplement will so state), the following
provisions of the Indenture will be applicable so long as there remain
outstanding any Debt Securities of any series to which this limitation applies.
Moreover, subject to termination upon defeasance as referred to below, the
Company will not create or suffer to be created or to exist any mortgage,
pledge, security interest or other lien (collectively, "Lien") on any of its
properties or assets, owned as of the date such series is issued or hereafter
acquired to secure any indebtedness, without making effective provision whereby
the Debt Securities of such series shall be equally and ratably secured with any
and all such indebtedness and with any other indebtedness similarly entitled to
be equally and ratably secured.
This restriction does not apply to, or prevent the creation or existence
of:
(1) Liens on property existing at the time of the acquisition or
construction of such property (or created within two years after completion
of such acquisition or construction), whether by purchase, merger,
construction or otherwise, or to secure the payment of all or any part of
the purchase price or construction cost thereof, including the extension of
any such Liens to repairs, renewals, replacements, substitutions,
betterments, additions, extensions and improvements then or thereafter made
on the property subject thereto;
(2) a Lien securing any bank indebtedness now or hereafter incurred or
assumed by the Company;
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(3) any extensions, renewals or replacements (or successive
extensions, renewals or replacements), in whole or in part, of Liens
permitted by the foregoing clauses (1) and (2);
(4) the pledge of any bonds or other securities at any time issued
under any of the Liens permitted by clause (1), (2) or (3) above; or
(5) Permitted Encumbrances. (Section 4.07)
"Permitted Encumbrances" includes, among other items: (a) the pledge or
assignment in the ordinary course of business of accounts receivable or
customers' installment paper; (b) Liens affixing to property of the Company at
the time a person consolidates with or merges into, or transfers all or
substantially all of its assets to, the Company, provided that in the opinion of
the Board of Directors of the Company or Company management (evidenced by a
certified Board resolution or an Officers' Certificate delivered to the Trustee)
the property acquired pursuant to the consolidation, merger or asset transfer is
adequate security for such Lien; (c) Liens or encumbrances not otherwise
permitted if, at the time of incurrence thereof and after giving effect thereto,
the aggregate of all obligations of the Company secured thereby does not exceed
10% of Tangible Net Worth (as defined below); (d) Liens on securities held by
the Company; and (e) Liens or encumbrances affixing to the property of a
Subsidiary.
"Tangible Net Worth" means (i) common stockholders' equity appearing on the
most recent balance sheet of the Company (or consolidated balance sheet of the
Company and its Subsidiaries if the Company then has one or more consolidated
Subsidiaries) prepared in accordance with generally accepted accounting
principles, less (ii) intangible assets (excluding intangible assets recoverable
through rates as prescribed by applicable regulatory authorities).
"Subsidiary" of any person means (i) a corporation more than 50% of the
outstanding voting stock of which is owned, directly or indirectly, by such
person or by one or more other Subsidiaries of such person or by such person and
one or more Subsidiaries thereof; or (ii) any other person (other than a
corporation) in which such person, or one or more Subsidiaries of such person or
such person and one or more Subsidiaries thereof, directly or indirectly, has at
least a majority ownership and power to direct the policy, management and
affairs thereof. (Section 4.06)
Further, this restriction will not apply to or prevent the creation or
existence of leases made, or existing on property acquired, in the ordinary
course of business. (Section 4.07)
Other Covenants
Any other restrictive covenants which may apply to a particular series of
Debt Securities will be described in the prospectus supplement relating thereto.
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Successor Obligor
Unless otherwise specified in the securities resolution establishing a
series of Debt Securities, the Company shall not consolidate with or merge into,
or transfer all or substantially all of its assets to, any person in any
transaction in which the Company is not the survivor, unless:
(1) the person is organized under the laws of the United States or a
State thereof or is organized under the laws of a foreign jurisdiction and
consents to the jurisdiction of the courts of the United States or a State
thereof;
(2) the person assumes by supplemental indenture all the obligations
of the Company under the Indenture, the Debt Securities and any coupons;
and
(3) immediately after the transaction no Default (as defined) exists.
The successor shall be substituted for the Company, and thereafter all
obligations of the Company under the Indenture, the Debt Securities and any
coupons shall terminate. (Section 5.01)
Exchange of Debt Securities
Registered Debt Securities may be exchanged for an equal aggregate
principal amount of registered Debt Securities of the same series and date of
maturity in such authorized denominations as may be requested upon surrender of
the registered Debt Securities at an agency of the Company maintained for such
purpose and upon fulfillment of all other requirements of such agent. (Section
2.07)
Default and Remedies
Unless the securities resolution establishing the series otherwise provides
(in which event the prospectus supplement will so state), an "Event of Default"
with respect to a series of Debt Securities will occur if:
(1) the Company defaults in any payment of interest on any Debt
Securities of such series when the same becomes due and payable and the
Default continues for a period of 60 days;
(2) the Company defaults in the payment of the principal and premium,
if any, of any Debt Securities of the series when the same becomes due and
payable at maturity or upon redemption, acceleration or otherwise and such
default shall continue for five or more days;
(3) the Company defaults in the payment or satisfaction of any sinking
fund obligation with respect to any Debt Securities of a series as required
by the securities resolution establishing such series and the Default
continues for a period of 60 days;
(4) the Company defaults in the performance of any of its other
agreements applicable to the series and the Default continues for 90 days
after the notice specified below;
(5) the Company pursuant to or within the meaning of any Bankruptcy
Law:
(A) commences a voluntary case,
(B) consents to the entry of an order for relief against it in an
involuntary case,
(C) consents to the appointment of a Custodian for it or for all
or substantially all of its property, or
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(D) makes a general assignment for the benefit of its creditors;
(6) a court of competent jurisdiction enters an order or decree under
any Bankruptcy Law that:
(A) is for relief against the Company in an involuntary case,
(B) appoints a Custodian for the Company or for all or
substantially all of its property, or
(C) orders the liquidation of the Company, and the order or
decree remains unstayed and in effect for 60 days; or
(7) there occurs any other Event of Default provided for in such
series. (Section 6.01)
The term "Bankruptcy Law" means Title 11, U.S. Code or any similar Federal
or State law for the relief of debtors. The term "Custodian" means any receiver,
trustee, assignee, liquidator or a similar official under any Bankruptcy Law.
(Section 6.01)
"Default" means any event which is, or after notice or passage of time
would be, an Event of Default. A Default under subparagraph (4) above is not an
Event of Default until the Trustee or the Holders of at least 33-1/3% in
principal amount of the series notify the Company of the Default and the Company
does not cure the Default within the time specified after receipt of the notice.
(Section 6.01) The Trustee may require indemnity satisfactory to it before it
enforces the Indenture or the Debt Securities of the series. (Section 7.01)
Subject to certain limitations, Holders of a majority in principal amount of the
Debt Securities of the series may direct the Trustee in its exercise of any
trust or power with respect to such series. (Section 6.05) Except in the case of
Default in payment on a series, the Trustee may withhold from Securityholders of
such series notice of any continuing Default (except a Default in payment of
principal or interest) if it determines that withholding notice is in their
interest (Section 7.04) The Company is required to furnish the Trustee annually
a brief certificate as to the Company's compliance with all conditions and
covenants under the Indenture. (Section 4.04)
The failure to redeem any Debt Securities subject to a Conditional
Redemption (as defined) is not an Event of Default if any event on which such
redemption is so conditioned does not occur and is not waived before the
scheduled redemption date. (Section 6.01)
The Indenture does not have a cross-default provision. Thus, a default by
the Company on any other debt, including any other series of Debt Securities,
would not constitute an Event of Default.
Amendments and Waivers
The Indenture and the Debt Securities or any coupons of the series may be
amended, and any default may be waived as follows: Unless the securities
resolution otherwise provides (in which event the prospectus supplement will so
state), the Debt Securities and the Indenture may be amended with the consent of
the Holders of a majority in principal amount of the Debt Securities of all
series affected voting as one class. (Section 9.02) Unless the securities
resolution otherwise provides (in which event the prospectus supplement will so
state), a Default on a particular series may be waived with the consent of the
Holders of a majority in principal amount of the Debt Securities of the series.
(Section 6.04)
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However, without the consent of each Holder affected, no amendment or
waiver may:
(1) reduce the amount of Debt Securities whose Holders must consent to
an amendment or waiver;
(2) reduce the interest on or change the time for payment of interest
on any Debt Security;
(3) change the fixed maturity of any Debt Security;
(4) reduce the principal of any non-Discounted Debt Security or reduce
the amount of the principal of any Discounted Debt Security that would be
due on acceleration thereof;
(5) change the currency in which the principal or interest on a Debt
Security is payable;
(6) make any change that materially adversely affects the right to
convert any Debt Security; or
(7) waive any Default in payment of interest on or principal of a Debt
Security. (Sections 6.04 and 9.02)
Without the consent of any Holder, the Indenture or the Debt Securities may
be amended: to cure any ambiguity, omission, defect or inconsistency; to provide
for assumption of Company obligations to Holders in the event of a merger or
consolidation requiring such assumption; to provide that specific provisions of
the Indenture shall not apply to a series of Debt Securities not previously
issued; to create a series and establish its terms; to provide for a separate
trustee for one or more series; or to make any change that does not materially
adversely affect the rights of any Holder. (Section 9.01)
Legal Defeasance and Covenant Defeasance
Debt Securities of a series may be defeased in accordance with their terms
and, unless the securities resolution establishing the terms of the series
otherwise provides, as set forth below. The Company at any time may terminate as
to a series all of its obligations (except for certain obligations, including
obligations with respect to the defeasance trust and obligations to register the
transfer or exchange of a Debt Security, to replace destroyed, lost or stolen
Debt Securities and coupons and to maintain paying agencies in respect of the
Debt Securities) with respect to the Debt Securities of the series and any
related coupons and the Indenture ("legal defeasance"). The Company at any time
may terminate as to a series its obligations with respect to the Debt Securities
and coupons of the series under the covenant described under "Certain
Covenants--Limitations on Liens" and any other restrictive covenants which may
be applicable to a particular series ("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, a series may not be accelerated because of an Event of
Default. If the Company exercises its covenant defeasance option, a series may
not be accelerated by reference to the covenant described under "Certain
Covenants--Limitations on Liens" or any other restrictive covenants which may be
applicable to a particular series. (Section 8.01)
To exercise either defeasance option as to a series, the Company must (i)
irrevocably deposit in trust (the "defeasance trust") with the Trustee or
another trustee money or U.S. Government Obligations, deliver a certificate from
a nationally recognized firm of independent accountants expressing their opinion
that the payments of principal and interest when due on the deposited U.S.
Government Obligations, without reinvestment, plus any deposited money without
investment will provide cash at such times and in such amounts as will be
sufficient to pay the principal and interest when due on all Debt Securities of
such series to maturity or redemption, as the case may be, and (ii) comply with
certain other conditions. In particular, the Company must obtain an opinion of
tax
11
<PAGE>
counsel that the defeasance will not result in recognition of any gain or loss
to holders for Federal income tax purposes. "U.S. Government Obligations" means
direct obligations of the United States or an instrumentality of the United
States, the payment of which is unconditionally guaranteed by the United States,
which, in either case, have the full faith and credit of the United States of
America pledged for payment and which are not callable at the issuer's option,
or certificates representing an ownership interest in such obligations. (Section
8.02)
Regarding the Trustee
Bank of Montreal Trust Company will act as Trustee for Debt Securities
issued under the Indenture and, unless otherwise indicated in a prospectus
supplement, the Trustee will also act as Registrar and Paying Agent with respect
to the Debt Securities. (Section 2.03) The Trustee is a member of the syndicate
of lenders with respect to the Company's credit facility.
BOOK-ENTRY
DTC will act as securities depository for the Debt Securities. The Debt
Securities will be issued only as fully registered securities registered in the
name of Cede & Co. (DTC's partnership nominee). One or more fully registered
global certificates will be issued for the Debt Securities representing the
aggregate principal amount of the Debt Securities and will be deposited with
DTC.
DTC is a limited-purpose trust company organized under the New York Banking
Law, a "banking organization" within the meaning of the New York Banking Law, a
member of the Federal Reserve System, a "clearing corporation" within the
meaning of the New York Uniform Commercial Code, and a "clearing agency"
registered pursuant to the provisions of Section 17A of the 1934 Act, as
amended, DTC holds securities that its participants (the "Direct Participants")
deposit with DTC. DTC also facilitates the settlement among Direct Participants
of securities transactions, such as transfers and pledges, in deposited
securities through electronic computerized book-entry changes in Direct
Participants' accounts, thereby eliminating the need for physical movement of
securities certificates. Direct Participants include securities brokers and
dealers, banks, trust companies, clearing corporations and certain other
organizations. DTC is owned by a number of its Direct Participants and by the
New York Stock Exchange, Inc., the American Stock Exchange, Inc., and the
National Association of Securities Dealers, Inc. Access to the DTC system is
also available to others such as securities brokers and dealers, banks and trust
companies that clear through or maintain a custodial relationship with a Direct
Participant, either directly or indirectly (the "Indirect Participants," and
together with the Direct Participants, the "Participants"). The rules applicable
to DTC and its Participants are on file with the SEC.
Purchases of the Debt Securities within the DTC system must be made by or
through Direct Participants which will receive a credit for the Debt Securities
on DTC's records. The ownership interest of each actual purchaser of each Debt
Security (a "Beneficial Owner") will in turn be recorded on the Direct and
Indirect Participants' respective records. Beneficial Owners will not receive
written confirmation from DTC of their purchase, but Beneficial Owners are
expected to receive written confirmations providing details of the transaction,
as well as periodic statements of their holdings, from the Direct or Indirect
Participant through which the Beneficial Owner entered into the transaction.
Transfers of ownership interest in the Debt Securities will be effected by
entries made on the books of Participants acting on behalf of Beneficial Owners.
Beneficial Owners will not receive certificates representing their ownership
interest in Debt Securities except in the event that use of the book-entry
system for the Debt Securities is discontinued.
The deposit of the Debt Securities with DTC and their registration in the
name of Cede & Co. effect no change in beneficial ownership. DTC has no
knowledge of the actual Beneficial Owners of the Debt Securities; DTC's records
reflect only the identity of the Direct Participants to whose accounts such Debt
Securities are
12
<PAGE>
credited, which may or may not be the Beneficial Owners. The Participants will
remain responsible for keeping account of their holdings on behalf of their
customers.
Conveyance of notices and other direct communications by DTC to Direct
Participants, by Direct Participants to Indirect Participants, and by Direct
Participants and Indirect Participants to Beneficial Owners will be governed by
arrangements among them, subject to any statutory or regulatory requirements as
may be in effect from time to time.
Redemption notices shall be sent to Cede & Co. If less than all of the Debt
Securities of an issue are being redeemed, DTC's practice will determine by lot
the amount of the interest of each Direct Participant in such series to be
redeemed.
Neither DTC nor Cede & Co. will consent or vote with respect to the Debt
Securities. Under its usual procedures, DTC mails an omnibus proxy (an "Omnibus
Proxy") to the Participants as soon as possible after the record date. The
Omnibus Proxy assigns Cede & Co.'s consenting or voting rights to those Direct
Participants to whose accounts the Debt Securities are credited on the record
date (identified in a listing attached to the Omnibus Proxy).
Principal, premium, if any, and interest on the Debt Securities will be
paid to DTC. DTC's practice is to credit Direct Participants' accounts on the
relevant payment date in accordance with their respective holdings shown on
DTC's records unless DTC has reason to believe that it will not receive payment
on such payment date. Payments by Participants to Beneficial Owners will be
governed by standing instructions and customary practices, as is the case with
securities held for the accounts of customers in bearer form or registered in
"street-name," and will be the responsibility of such Participant and not of
DTC, the underwriters, or the Company, subject to any statutory or regulatory
requirements as may be in effect from time to time. Payment of principal,
premium, if any, and interest to DTC is the responsibility of the Company or the
Trustee. Disbursement of such payments to Direct Participants is the
responsibility of DTC, and disbursement of such payments to the Beneficial
Owners is the responsibility of Direct and Indirect Participants.
DTC may discontinue providing its services as securities depository with
respect to the Debt Securities at any time by giving reasonable notice to the
Company. Under such circumstances and in the event that a successor securities
depository is not obtained, certificates for the Debt Securities are required to
be printed and delivered. In addition, the Company may decide to discontinue use
of the system of book-entry transfers through DTC (or any successor securities
depository). In that event, certificates for the Debt Securities will be printed
and delivered.
The Company will not have any responsibility or obligation to Participants
or to the persons for whom they act as nominees with respect to the accuracy of
the records of DTC, its nominees or any Direct or Indirect Participant with
respect to any ownership interest in the Debt Securities, or with respect to
payments or providing of notice to the Direct Participants, the Indirect
Participants or the Beneficial Owners.
So long as Cede & Co. is the registered owner of the Debt Securities, as
nominee of DTC, references herein to holders of the Debt Securities shall mean
Cede & Co. or DTC and shall not mean the Beneficial Owners of the Debt
Securities.
The information in this section concerning DTC and DTC's book-entry system
has been obtained from DTC. None of the Company, the Trustees or the
underwriters take any responsibility for the accuracy or completeness thereof.
13
<PAGE>
PLAN OF DISTRIBUTION
The Company may sell Debt Securities in any of the following ways: (i)
through underwriters or dealers; (ii) directly to one or more purchasers; or
(iii) through agents. The applicable prospectus supplement will set forth the
terms of the offering of any Debt Securities, including the names of any
underwriters or agents, the purchase price of such Debt Securities and the
proceeds to the Company from such sale, any underwriting discounts and other
items constituting underwriters' compensation, any initial public offering
price, any discounts or concessions allowed or reallowed or paid to dealers and
any securities exchanges on which such Debt Securities may be listed.
If underwriters are used in the sale, Debt Securities will be acquired by
the underwriters for their own account and may be resold from time to time in
one or more transactions, including negotiated transactions, at a fixed public
offering price or at varying prices determined at the time of sale. Such Debt
Securities may be offered to the public either through underwriting syndicates
represented by managing underwriters or by underwriters without a syndicate.
Unless otherwise set forth in the applicable prospectus supplement, the
obligations of the underwriters to purchase such Debt Securities will be subject
to certain conditions precedent, and the underwriters will be obligated to
purchase all of such Debt Securities if any of such Debt Securities are
purchased. Any initial public offering price and any discounts or concessions
allowed or reallowed or paid to dealers may be changed from time to time. Only
underwriters named in a prospectus supplement are deemed to be underwriters in
connection with the Debt Securities offered thereby.
Debt Securities may also be sold directly by the Company or through agents
designated by the Company from time to time. Any agent involved in the offer or
sale of Debt Securities will be named, and any commissions payable by the
Company to such agent will be set forth in the applicable prospectus supplement.
Unless otherwise indicated in the applicable prospectus supplement, any such
agent will act on a best efforts basis for the period of its appointment.
If so indicated in a prospectus supplement with respect to Debt Securities,
the Company will authorize agents, underwriters or dealers to solicit offers by
certain institutions to purchase such Debt Securities from the Company at the
public offering price set forth in the prospectus supplement pursuant to Delayed
Delivery Contracts ("Contracts") providing for payment and delivery on the date
or dates stated in the prospectus supplement. Each Contract will be for an
amount not less than, and the aggregate principal amount of the Debt Securities
sold pursuant to the Contracts shall be not less nor more than, the respective
amounts stated in the prospectus supplement. Institutions with whom the
Contracts, when authorized, may be made include commercial and savings banks,
insurance companies, pension funds, investment companies, educational and
charitable institutions, and other institutions, but will in all cases be
subject to the approval of the Company. The Contracts will not be subject to any
conditions except (i) the purchase by an institution of the Debt Securities
covered by its Contract shall not at the time of delivery be prohibited under
the laws of any jurisdiction in the United States to which such institution is
subject, and (ii) if the Debt Securities are being sold to underwriters, the
Company shall have sold to such underwriters the total principal amount of the
Debt Securities less the principal amount thereof covered by the Contracts. The
underwriters will not have any responsibility in respect of the validity or
performance of the Contracts.
If dealers are utilized in the sale of any Debt Securities, the Company
will sell such Debt Securities to the dealers, as principal. Any dealer may then
resell such Debt Securities to the public at varying prices to be determined by
such dealer at the time of resale. The name of any dealer and the terms of the
transaction will be set forth in the prospectus supplement with respect to such
Debt Securities being offered thereby.
It has not been determined whether any series of Debt Securities will be
listed on a securities exchange. Underwriters will not be obligated to make a
market in any series of Debt Securities. The Company cannot predict the level of
trading activity in, or the liquidity of, any series of Debt Securities.
14
<PAGE>
Any underwriters, dealers or agents participating in the distribution of
Debt Securities may be deemed to be underwriters, and any discounts or
commissions received by them on the sale or resale of Debt Securities may be
deemed to be underwriting discounts and commissions under the Securities Act of
1933. Agents and underwriters may be entitled under agreements entered into with
the Company to indemnification by the Company against certain liabilities,
including liabilities under the Securities Act of 1933, or to contribution with
respect to payments that the agents or underwriters may be required to make in
respect thereof. Agents and underwriters may be customers of, engaged in
transactions with, or perform services for, the Company or its affiliates in the
ordinary course of business.
LEGAL MATTERS
Certain legal matters with respect to the validity of the issuance of the
Debt Securities will be passed upon for the Company by Cahill Gordon & Reindel,
a partnership including a professional corporation, New York, New York.
EXPERTS
The financial statements of Sequa Corporation incorporated by reference in
this prospectus and elsewhere in the Registration Statement have been audited by
Arthur Andersen LLP, independent public accountants, as indicated in their
reports with respect thereto, and are included herein in reliance upon the
authority of said firm as experts in giving said reports.
15
<PAGE>
<TABLE>
<CAPTION>
<S> <C>
======================================================= ================================================
No person is authorized to give any information or to
make any representation other than those contained in
this prospectus, including any prospectus supplement in
connection with the offer of the Debt Securities, Sequa Corporation
and, if given or made, such information or
representations must not be relied upon as having been
authorized. This prospectus does not constitute an
offer to sell or a solicitation of an offer to buy
such securities in any circumstance in which such
offer or solicitation is unlawful. Neither the
delivery of this prospectus nor any sale made
hereunder shall, under any circumstances, create any
implication that there has been no change in the
affairs of the Company since the date hereof or that
the information contained or incorporated by reference
herein is correct as of any time subsequent to the __________
date of this prospectus.
PROSPECTUS
----------
--------------------
TABLE OF CONTENTS
Page
Incorporation of Certain Documents
by Reference.............................. 2
The Company................................. 3
Use of Proceeds............................. 4
Ratio of Earnings to Fixed Charges.......... 5 Debt Securities
Description of Debt Securities.............. 5
Book-Entry.................................. 12
Plan of Distribution........................ 14
Legal Matters............................... 15
Experts..................................... 15
, 1998
======================================================= ================================================
</TABLE>
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
An estimate of expenses, other than underwriting discount, follows:
Securities and Exchange Commission registration fee......... $139,000
Trustee's fees and expenses................................. 10,000
Printing.................................................... 40,000
Legal fees and expenses .................................... 45,000
Accountants' fees and expenses.............................. 50,000
Rating agencies fees........................................ 325,000
Miscellaneous expenses...................................... 12,500
Total ................................... $621,500*
=========
- -----------------
* All expenses, except the Securities and Exchange Commission registration
fee, are estimated.
Item 15. Indemnification of Directors and Officers.
Reference is made to Section 102(b)(7) of the Delaware General Corporation
Law (the "DGCL"), which permits a corporation in its certificate of
incorporation or an amendment thereto to eliminate or limit the personal
liability of a director for violations of the director's fiduciary duty, except
(i) for any breach of the director's fiduciary duty of loyalty to the
corporation or its stockholders, (ii) for acts or omissions not in good faith or
which involve intentional misconduct or a knowing violation of law, (iii)
pursuant to Section 174 of the DGCL (providing for liability of directors for
unlawful payment of dividends or unlawful stock purchases or redemptions), or
(iv) for any transaction from which the director derived an improper personal
benefit. The Company's Restated Certificate of Incorporation contains provision
permitted by Section 102(b)(7) of the DGCL.
Reference is made to Section 145 of the DGCL which provides that a
corporation may indemnify any persons, including directors and officers, who
are, or are threatened to be made, parties to any threatened, pending or
completed legal action, suit or proceeding, whether civil, criminal,
administrative or investigative (other than an action by or in the right of such
corporation), by reason of the fact that such person is or was a director,
officer, employee or agent of another corporation, or is or was serving at the
request of such corporation as a director, officer, employee or agent of another
corporation or enterprise. The indemnity may include expenses (including
attorneys' fees), judgments, fines and amounts paid in settlement actually and
reasonably incurred by such person in connection with such action, suit or
proceeding, provided such director, officer, employee or agent acted in good
faith and in a manner he reasonably believed to be in or not opposed to the
corporation's best interest and, with respect to any criminal actions or
proceedings, had no reasonable cause to believe that his conduct was unlawful. A
Delaware corporation may indemnify directors and/or officers in an action or
suit by or in the right of the corporation under the same conditions, except
that no indemnification is permitted without judicial approval if the director
or officer is adjusted to be liable to the corporation. Where a director or
officer is successful on the merits or otherwise in the defense of any action
referred to above, the corporation must indemnify him or her against the
expenses which such director or officer actually and reasonably incurred.
<PAGE>
The Company's Restated Certificate of Incorporation and By-laws provide for
the indemnification of directors and officers of the Company to the fullest
extent permitted by the DGCL.
The Company provides liability insurance for each director and officer for
certain losses arising from claims or charges made against them while acting in
their capacities as directors or officers of the Company.
The Standard Purchase Agreement filed as Exhibit 1 to the Registration
Statement includes provisions requiring underwriters to indemnify the Company as
well as its directors and officers who signed this Registration Statement, as
well as its controlling persons, against certain civil liabilities, including
liabilities under the Securities Act of 1933, in certain circumstances.
Item 16. Exhibits.
The Exhibits to this Registration Statement are listed in the Exhibit Index
on Pages E-1 and E-2 of this Registration Statement, which Index is incorporated
herein by reference.
Item 17. Undertakings.
The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this Registration Statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising
after the effective date of the Registration Statement (or the most
recent post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth
in the Registration Statement;
(iii) To include any material information with respect to the
plan of distribution not previously disclosed in the Registration
Statement or any material change to such information in the
Registration Statement;
provided, however, that paragraphs (1)(i) and (1)(ii) do not apply if the
Registration Statement is on Form S-3 or Form S-8, and the information
required to be included in a post-effective amendment by those paragraphs
is contained in periodic reports filed by the Registrant pursuant to
Section 13 or Section 15(d) of the Securities Exchange Act of 1934 that are
incorporated by reference in the Registration Statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment that contains a
form of prospectus shall be deemed to be a new Registration Statement
relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide
offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
II-2
<PAGE>
The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of
Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 that is incorporated by reference in the
Registration Statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the Registrant pursuant to the provisions described under Item 15 above, or
otherwise, the Registrant has been advised that in the opinion of the Securities
and Exchange Commission such indemnification is against public policy as
expressed in the Act and is, therefore, unenforceable. In the event that a claim
for indemnification against such liabilities (other than the payment by the
Registrant of expenses incurred or paid by a director, officer or controlling
person of the Registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the Registrant will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Act and will
be governed by the final adjudication of such issue.
II-3
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, Sequa
Corporation, the Registrant, certifies that it has reasonable grounds to believe
that it meets all of the requirements for filing on Form S-3 and has duly caused
this Registration Statement to be signed on its behalf by the undersigned,
thereunder duly authorized, in the City of New York, New York on the 23rd day of
October, 1998.
SEQUA CORPORATION
(Registrant)
By: /s/ Norman E. Alexander
----------------------------------
Norman E. Alexander
Chairman of the Board and Chief
Executive Officer
Each person whose signature appears below appoints Norman E. Alexander,
John J. Quicke and Stuart Z. Krinsly, and each of them, any of whom may act
without the joinder of the other, as his true and lawful attorneys-in-fact and
agents, with full power of substitution and resubstitution, for him and in his
name, place and stead, in any and all capacities, to sign any and all amendments
(including post-effective amendments) to this Registration Statement on Form S-3
and to file the same, with all exhibits thereto and all other documents in
connection therewith, with the Securities and Exchange Commission, granting unto
said attorneys-in-fact and agents full power and authority to do and perform
each and every act and thing requisite and necessary to be done, as fully to all
intents and purposes as he might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents or their substitute or
substitutes may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons, in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
Signature Title Date
<S> <C> <C>
Chairman of the Board and Chief
/s/ Norman E. Alexander Executive Officer October 23,1998
- ------------------------------------
Norman E. Alexander
President, Chief Operating
/s/ John J. Quicke Officer and Director October 23,1998
- ------------------------------------
John J. Quicke
Senior Executive Vice
/s/ Stuart Z. Krinsly President, General Counsel and October 23,1998
- ------------------------------------
Stuart Z. Krinsly Director
/s/ Leon D. Black Director October 23,1998
- ------------------------------------
Leon D. Black
II-4
<PAGE>
/s/ Alvin Dworman Director October 23,1998
- ------------------------------------
Alvin Dworman
/s/ David S. Gottesman Director October 23,1998
- ------------------------------------
David S. Gottesman
/s/ Donald D. Kummerfeld Director October 23,1998
- ------------------------------------
Donald D. Kummerfeld
/s/ Richard S. LeFrak Director October 23,1998
- ------------------------------------
Richard S. LeFrak
/s/ Michael I. Sovern Director October 23,1998
- ------------------------------------
Michael I. Sovern
/s/ Fred R. Sullivan Director October 23,1998
- ------------------------------------
Fred R. Sullivan
/s/ Gerald Tsai, Jr. Director October 23,1998
- ------------------------------------
Gerald Tsai, Jr.
</TABLE>
II-5
<PAGE>
INDEX TO EXHIBITS
Exhibit
Number Exhibit
1 -- Standard Purchase Agreement
4(a) -- Form of Indenture for Debt Securities
4(b) -- Form of Securities Resolution
5 -- Opinion of Cahill Gordon & Reindel
12 -- Computation of Ratio of Earnings to Fixed Charges
23(a) -- Consent of Cahill Gordon & Reindel (contained in Exhibit 5)
23(b) -- Consent of Arthur Andersen LLP
24 Power of Attorney (set forth on the signature page of this
Registration Statement)
25 -- Statement of Eligibility of Trustee regarding Form of
Indenture of Debt Securities
SEQUA CORPORATION
DEBT SECURITIES
STANDARD PURCHASE PROVISIONS
INCLUDING
FORM OF PURCHASE AGREEMENT
<PAGE>
SEQUA CORPORATION
STANDARD PURCHASE PROVISIONS
From time to time, Sequa Corporation, a corporation organized and existing
under the laws of the State of Delaware (the "Company") may enter into purchase
agreements that provide for the sale of designated securities to the purchaser
or purchasers named therein. The standard provisions set forth herein may be
incorporated by reference in any such purchase agreement (the "Purchase
Agreement"). The Purchase Agreement, including the provisions incorporated
therein by reference, is herein sometimes referred to as "this Agreement." The
term "Debt Securities" shall mean the Debt Securities of the Company to be sold
by the Company pursuant to the applicable Purchase Agreement. Unless otherwise
defined herein, terms defined in the Purchase Agreement are used herein as
therein defined.
The Company has filed, in accordance with the provisions of the Securities
Act of 1933, as amended, and the rules and regulations thereunder (collectively
called the "Act"), with the Securities and Exchange Commission (the
"Commission"), a registration statement on Form S-3 (including a prospectus),
relating to the Debt Securities, which pursuant to Item 12 of Form S-3
incorporates by reference documents which the Company and others have filed in
accordance with the provisions of the Securities Exchange Act of 1934, as
amended, and the rules and regulations thereunder (collectively called the
"Exchange Act") relating to the Company or other companies involved in
transactions involving the Company. Such registration statement has been
declared effective by the Commission. Promptly upon the execution of this
Agreement, the Company will prepare a prospectus supplement relating to the Debt
Securities (the "Prospectus Supplement"). The Company has furnished to you, for
use by the Underwriters (as defined herein) and dealers, copies of one or more
preliminary prospectuses and the documents so incorporated therein (each
thereof, including the documents so incorporated therein, is herein called the
"Preliminary Prospectus").
1. Introductory. The Company proposes to issue and sell from time to time
Debt Securities registered under the Registration Statement. The Debt Securities
will be issued pursuant to the Indenture (the "Indenture"), dated , 1998,
between the Company and Bank of Montreal Trust Company, as Indenture Trustee
(the "Indenture Trustee"), as supple-
<PAGE>
-2-
mented, including by a supplemental indenture pertaining to the particular
series of Debt Securities involved in the offering or by a Securities Resolution
(as defined in the Indenture), and will have varying designations, interest
rates and times of payment of any interest, maturities, redemption, put and call
provisions and other terms, including, if specified with respect to a series,
with all such terms for any particular series of the Debt Securities being
determined at the time of the sale and set forth in the Purchase Agreement and
the Prospectus Supplement relating to such series of Debt Securities. The Debt
Securities involved in any such offering are hereinafter referred to as the
"Purchased Debt Securities," and the firm or firms, as the case may be, which
agree to purchase the same are hereinafter referred to as the "Underwriters" of
the Purchased Debt Securities. The terms "you" and "your" refer to those
Underwriters who sign the Purchase Agreement either on behalf of themselves only
or on behalf of themselves and as representatives of the several Underwriters
named in Schedule A thereto, as the case may be. Purchased Debt Securities to be
purchased by Underwriters are herein referred to as "Underwriters' Debt
Securities," and any Purchased Debt Securities to be purchased pursuant to
Delayed Delivery Contracts (as defined below) as hereinafter provided are herein
referred to as "Contract Debt Securities."
2. Delivery and Payment. The Company will deliver the Underwriters' Debt
Securities to you for the accounts of the Underwriters at the place specified in
the Purchase Agreement, against payment of the purchase price by wire transfer
of immediately available funds (as agreed to by the parties and specified in the
Purchase Agreement) drawn to the order of the Company, at the time set forth in
this Agreement or at such other time not later than seven full business days
thereafter as you and the Company determine, such time being herein referred to
as the "time of purchase." Unless otherwise provided for in the Purchase
Agreement, the Underwriters' Debt Securities so to be delivered will be in
definitive fully registered form registered in such authorized denominations and
in such names as you request in writing not later than 10:00 A.M.,* on the third
business day prior to the time of purchase, or, if no such request is received,
in the names of the respective Underwriters in the amounts agreed to be
purchased by them pursuant to this Agreement. For the purpose of expediting the
checking
- ----------
* Times mentioned herein are New York City Time.
<PAGE>
-3-
of the Underwriters' Debt Securities, the Company agrees to make the
Underwriters' Debt Securities available to you (at the place specified in the
Purchase Agreement) in definitive form not later than 10:00 A.M. on the first
business day preceding the time of purchase.*
If any Purchase Agreement provides for sales of Purchased Debt Securities
pursuant to delayed delivery contracts, the Company authorizes the Underwriters
to solicit offers to purchase Contract Debt Securities pursuant to delayed
delivery contracts substantially in the form of Schedule I attached hereto (the
"Delayed Delivery Contracts") with such changes therein as the Company may
approve. Delayed Delivery Contracts are to be with institutional investors,
including commercial and savings banks, insurance companies, pension funds,
investment companies, and educational and charitable institutions. At the time
of purchase the Company will pay you as compensation, for the accounts of the
Underwriters, the compensation set forth in such Purchase Agreement in respect
of the principal amount of Contract Debt Securities. The Underwriters will not
have any responsibility in respect of the validity or the performance of Delayed
Delivery Contracts. If the Company executes and delivers Delayed Delivery
Contracts, the Contract Debt Securities shall be deducted from the Purchased
Debt Securities to be purchased by the several Underwriters and the aggregate
principal amount of Purchased Debt Securities to be purchased by each
Underwriter shall be reduced pro rata in proportion to the principal amount of
Purchased Debt Securities set forth opposite each Underwriter's name in such
Purchase Agreement, except to the extent that you determine that such reduction
shall be otherwise allocated and so advise the Company.
3. Certain Covenants of the Company. The Company agrees:
(a) As soon as possible after the execution and delivery of this
Agreement to file the Prospectus with the Commission pursuant to its Rule
424 under the Act and, if and when required at any time after such
execution and delivery, to file amendments to the applications the Company
has previously filed with any state regulatory agencies
- ----------
* As used herein, "business day" shall mean a day on which the New York Stock
Exchange is open for trading.
<PAGE>
-4-
having jurisdiction over the Company's issuance of its securities setting
forth, among other things, the necessary information with respect to the
price and terms of the offering of the Purchased Debt Securities;
(b) To file no amendment or supplement to the Registration Statement
or Prospectus subsequent to the execution of this Agreement to which you
reasonably object in writing unless, in the opinion of counsel to the
Company, such filing is required by law;
(c) To furnish such proper information as may be required and
otherwise to cooperate in qualifying the Purchased Debt Securities for sale
under the laws of such jurisdictions as you may designate and in
determining their eligibility for investment under the laws of such
jurisdictions; provided that the Company shall not hereby be required to
qualify as a foreign corporation or to file a general consent to service of
process in any jurisdiction;
(d) To the extent not previously furnished to you, to furnish to you
two signed copies of the Registration Statement, as initially filed with
the Commission, of all amendments thereto, and of all documents
incorporated by reference therein (including all exhibits filed therewith,
other than exhibits which have previously been furnished to you and
exhibits incorporated by reference in such documents), and to furnish to
you sufficient unsigned copies of the foregoing (other than exhibits) for
distribution of a copy to you and to each of the other Underwriters (if
any);
(e) To deliver to the Underwriters without charge as soon as
practicable after the execution and delivery of this Agreement and
thereafter from time to time to furnish to the Underwriters, without
charge, as many copies of the Prospectus in final form and any documents
incorporated by reference therein at or after the date thereof (and of the
Registration Statement as amended or supplemented, if the Company shall
have made any amendment or supplement after the effective date of the
Registration Statement) as you or the respective Underwriters may
reasonably request for the purposes contemplated by the Act;
(f) To advise you promptly (confirming such advice in writing) of any
official request made by the Commission for amendments to the Registration
Statement or Prospectus or for additional information with respect thereto,
or of
<PAGE>
-5-
official notice of institution of proceedings for, or the entry of, a stop
order suspending the effectiveness of the Registration Statement and, if
such a stop order should be entered by the Commission, to make every
reasonable effort to obtain the lifting or removal thereof as soon as
possible, or of the suspension of qualification of the Purchased Debt
Securities for offering or sale in any jurisdiction or of the initiation or
threatening of any proceeding for any such purpose;
(g) To advise the Underwriters of the happening of any event known to
the Company within the time during which a prospectus relating to the
Purchased Debt Securities is required to be delivered under the Act which,
in the judgment of the Company, would require the making of any change in
the Prospectus or any amended or supplemented Prospectus or in the
information incorporated by reference therein so that as thereafter
delivered to purchasers such Prospectus will not include an untrue
statement of a material fact or omit to state a material fact necessary in
order to make the statements therein, in the light of the circumstances
under which they were made, not misleading, and on request to prepare and
furnish to the Underwriters and to dealers and other persons designated by
you such amendments or supplements (including appropriate filings under the
Exchange Act) to the Prospectus as may be necessary to reflect any such
change, provided that the Company shall be so obligated subsequent to the
time of purchase only so long as the Company is notified of unsold
allotments (failure by the Underwriters to so notify the Company cancels
the Company's obligation under this Section 3(g));
(h) As soon as practicable, to make generally available to its
security holders an earnings statement (as contemplated by Rule 158 under
the Act) covering a period of twelve months after the effective date (as
the term "effective date" is defined in Rule 158) of the Registration
Statement;
(i) To pay the reasonable fees and expenses of counsel for the
Underwriters, and to reimburse the Underwriters for their reasonable
out-of-pocket expenses incurred in contemplation of the performance of this
Agreement, in the event that the Underwriters' Debt Securities are not
delivered to and taken up and paid for by the Underwriters hereunder for
any reason whatsoever except the failure or refusal of any Underwriter to
take up and pay for Under-
<PAGE>
-6-
writers' Debt Securities for some reason not permitted by the terms of this
Agreement, the Underwriters agreeing to pay the fees and expenses of
counsel for the Underwriters in any other event;
(j) To pay all expenses, fees and taxes (other than transfer taxes and
fees and disbursements of counsel for the Underwriters, except as set forth
under 3(i) above or (iv) below) in connection with (i) the preparation and
filing of the Registration Statement, each Preliminary Prospectus and the
Prospectus, any documents incorporated by reference therein at or after the
date thereof and any amendments or supplements thereto, and the printing
and furnishing of copies of each thereof to the Underwriters and to
dealers, (ii) the issue, sale and delivery of the Purchased Debt
Securities, (iii) the printing and reproduction of this Agreement and the
opinions and letters referred to in Section 4(a) hereof, (iv) the
qualification of the Purchased Debt Securities for sale and determination
of their eligibility for investment under state laws as aforesaid,
including the legal fees (not to exceed $3,000) and all filing fees and
disbursements of counsel for the Underwriters and all other filing fees,
and the printing and furnishing of copies of the "Blue Sky Survey" and the
"Legal Investment Survey" to the Underwriters and to dealers, (v) the
rating of the Purchased Debt Securities by national rating agencies and
(vi) the performance of the Company's other obligations hereunder;
(k) To cause the Indenture to be duly authorized by the Company and to
be registered under the Trust Indenture Act of 1939, as amended;
(l) To furnish to the Underwriters, at or before the time of filing
with the Commission subsequent to the effective date of the Registration
Statement and prior to the termination of the distribution of the Purchased
Debt Securities, a copy of any document proposed to be filed by the Company
pursuant to Section 13(a), 13(d), 14 or 15(d) of the Exchange Act; and
(m) During the period beginning from the date of this Agreement and
continuing to and including the later of (i) the termination of trading
restrictions on the Purchased Debt Securities, as notified to the Company
by the Underwriters, and (ii) the time of purchase, the Company will not
offer, sell, contract to sell or otherwise dispose of any debt securities
of the Company which mature
<PAGE>
-7-
more than one year after the time of purchase and which are substantially
similar to the Purchased Debt Securities, without the Underwriters' prior
written consent; provided, however, that in no event shall the foregoing
period extend more than fifteen calendar days from the date of this
Agreement.
4. Conditions of Underwriters' Obligations. The several obligations of the
Underwriters hereunder are subject to the following conditions:
(a) That, at the time of purchase, you shall receive the signed
opinions of Stuart Z. Krinsly, Senior Executive Vice President and General
Counsel of the Company; Cahill Gordon & Reindel, counsel for the Company;
and , counsel for the Underwriters, in each case substantially in the forms
heretofore furnished to you and in substance satisfactory to you, addressed
to the Underwriters (with reproduced or conformed copies thereof for each
of the other Underwriters); and that, at the time of purchase, you shall
receive the signed letter of Arthur Andersen LLP, independent public
accountants of the Company substantially in the form heretofore furnished
to you and in substance satisfactory to you addressed to the Underwriters
(with reproduced or conformed copies thereof for each of the other
Underwriters);
(b) Prior to such time of purchase no stop order with respect to the
effectiveness of the Registration Statement shall have been issued under
the Act by the Commission and at such time of purchase no proceedings
therefor shall be pending or threatened;
(c) That, at the time the Registration Statement became effective, the
Registration Statement did not contain an untrue statement of a material
fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading, and that the
Prospectus at its issue date and at the time of purchase shall not contain
an untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein,
in the light of the circumstances under which they were made, not
misleading, other than any statement contained in, or any matter omitted
from, the Registration Statement or the Prospectus in reliance upon, and in
conformity with, information furnished in writing by or on behalf of any
Underwriter through you to the Company ex-
<PAGE>
-8-
pressly for use with reference to such Underwriter in the Registration
Statement or Prospectus;
(d) That, subsequent to the respective dates as of which information
is given in the Registration Statement and in the Prospectus, at the time
the Prospectus is first filed pursuant to Rule 424 under the Act, and prior
to the time of purchase, in your opinion no material adverse change in the
condition of the Company, financial or otherwise, shall have taken place
(other than as referred to in or contemplated by the Registration Statement
and Prospectus as of such time) which, in the reasonable judgment of the
Underwriters, is sufficiently material and adverse so as to render it
impractical or inadvisable to offer or deliver the Purchased Debt
Securities on the terms and in the manner contemplated in the Prospectus;
(e) That the Company shall have performed all of its obligations under
this Agreement which are to be performed by the terms hereof at or before
the time of purchase;
(f) That the Company shall, at the time of purchase, deliver to you
(with reproduced or conformed copies thereof for each of the other
Underwriters) a signed certificate of two of its executive officers stating
that, subsequent to the respective dates as of which information is given
in the Registration Statement and in the Prospectus, at the time the
Prospectus is first filed pursuant to Rule 424 under the Act, and prior to
the time of purchase, no material adverse change in the condition of the
Company, financial or otherwise, shall have taken place (other than as
referred to in or contemplated by the Registration Statement and Prospectus
as of such time) and also covering the matters set forth in (c) and (e) of
this Section 4;
(g) That the Company shall have accepted Delayed Delivery Contracts in
any case in which sales of Contract Debt Securities arranged by the
Underwriters have been approved by the Company; and
(h) That subsequent to the date of this Agreement: (i) no downgrading
shall have occurred in the rating accorded the Company's Debt Securities by
a "nationally recognized securities rating organization," as that term is
defined by the Commission for purposes of its Rule 436(g)(2); and (ii) no
such rating organization shall have announced publicly subsequent to the
date of this Agree-
<PAGE>
-9-
ment that it has placed, or informed the Company or the Underwriters that
it intends to place, any of the Debt Securities on what is commonly
referred to as a "watchlist" for possible downgrading, in a manner or to an
extent indicating a materially greater likelihood of a downgrading as
described in clause (i) above occurring than was the case as of the date
hereof.
5. Termination of Agreement. The obligations of the several Underwriters
hereunder shall be subject to termination in your absolute discretion, if, at
any time prior to the time of purchase, trading in securities on the New York
Stock Exchange shall have been suspended (other than a temporary suspension to
provide for an orderly market) or minimum prices shall have been established on
the New York Stock Exchange, or if a banking moratorium shall have been declared
either by the United States or New York State authorities, or if the United
States shall have declared war in accordance with its constitutional processes
or there shall have occurred any outbreak or material escalation of hostilities
or other national or international calamity or crisis of such magnitude in its
effect on the financial markets of the United States as, in your reasonable
judgment, to make it impracticable to market the Purchased Debt Securities.
If you elect to terminate this Agreement as provided in this Section 5, the
Company and each other Underwriter shall be notified promptly in writing or by
telephone, confirmed in writing.
If the sale to the Underwriters of the Underwriters' Debt Securities, as
herein contemplated, is not carried out by the Underwriters for any reason
permitted hereunder or if such sale is not carried out because the Company shall
be unable to comply with any of the terms thereof, the Company shall not be
under any obligation or liability under this Agreement (except to the extent
provided in Sections 3(i), 3(j), 7(b) and 9 hereof), and the Underwriters shall
be under no obligation or liability to the Company (except to the extent
provided in Sections 8(b) and 9 hereof) or to one another under this Agreement.
6. Increase in Underwriters' Commitments. If any Underwriter shall default
in its obligation to take up and pay for the Purchased Debt Securities to be
purchased by it hereunder and if the principal amount of the Purchased Debt
Securities which all Underwriters so defaulting shall have so failed to take up
and pay for does not exceed 10% of the total princi-
<PAGE>
-10-
pal amount of the Purchased Debt Securities, the non-defaulting Underwriters
shall take up and pay for (in addition to the principal amount of the Purchased
Debt Securities they are obligated to purchase pursuant to this Agreement) the
principal amount of the Purchased Debt Securities agreed to be purchased by all
such defaulting Underwriters, as herein provided. Such Purchased Debt Securities
shall be taken up and paid for by such non-defaulting Underwriter or
Underwriters in such amount or amounts as you may designate with the consent of
each Underwriter so designated or, in the event no such designation is made,
such Purchased Debt Securities shall be taken up and paid for by all
non-defaulting Underwriters pro rata in proportion to the principal amount of
the Purchased Debt Securities set opposite the names of all such non-defaulting
Underwriters in Schedule A to the Purchase Agreement.
Without relieving any defaulting Underwriter of its obligations hereunder,
the Company agrees with the non-defaulting Underwriters that it will not sell
any Purchased Debt Securities hereunder unless all of the Underwriters' Debt
Securities are purchased by the Underwriters (or by substituted Underwriters
selected by you with the approval of the Company or selected by the Company with
your approval).
If a new underwriter or underwriters are substituted by the Underwriters or
by the Company for a defaulting Underwriter or Underwriters in accordance with
the foregoing provision, the Company or you will have the right to postpone the
time of purchase for a period of not exceeding five business days in order that
necessary changes in the Registration Statement and Prospectus and other
documents may be effected.
The term "Underwriter" as used in this Agreement will refer to and include
any underwriter substituted under this Section 6 with like effect as if such
substituted underwriter had originally been named in Schedule A to the Purchase
Agreement.
7. Warranties and Representations of and Indemnity by the Company. (a) The
Company warrants and represents that, when the Registration Statement became
effective, the Registration Statement complied in all material respects, and,
when the Prospectus is first filed pursuant to Rule 424 under the Act, and at
the time of purchase the Prospectus will comply in all material respects, with
the provisions of the Act, and that the Registration Statement, at the time it
became effective, did not contain an untrue statement of a material fact or omit
to state a material fact required to be stated therein or neces-
<PAGE>
-11-
sary to make the statements therein not misleading, and that the Prospectus, at
its issue date and at the time of purchase, did not and will not contain an
untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading; provided, however,
that the Company makes no warranty or representation with respect to any
statement contained in, or any matter omitted from, the Registration Statement
or the Prospectus in reliance upon and in conformity with information furnished
in writing by or on behalf of any Underwriter through you to the Company
expressly for use with reference to the Underwriter in the Registration
Statement or Prospectus. The Company also warrants and represents that the
documents incorporated by reference in the Prospectus complied at the time they
were filed in all material respects with the requirements of the Exchange Act
and any additional documents deemed to be incorporated by reference in the
Prospectus will, when they are filed with the Commission, comply in all material
respects with the requirements of the Exchange Act, and will not contain an
untrue statement of a material fact or omit to state a material fact required to
be stated therein, or necessary to make the statements therein, in the light of
the circumstances under which they are made, not misleading.
(b) The Company agrees to indemnify and hold harmless each Underwriter, and
any person who controls any Underwriter within the meaning of Section 15 of the
Act or Section 20 of the Exchange Act, from and against any loss, expense,
liability or claim which arises out of or is based upon any alleged untrue
statement of a material fact in the Registration Statement, any prospectus
contained in the Registration Statement at the time it became effective or the
Prospectus, or any related preliminary prospectus, or arises out of or is based
upon any alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements made therein (in the case of any
such prospectus, the Prospectus or any such preliminary prospectus, in light of
the circumstances under which they were made) not misleading. The foregoing
shall not cover any such loss, expense, liability or claim, however, which
arises out of or is based upon any alleged untrue statement of a material fact
contained in, and in conformity with information furnished in writing by or on
behalf of any Underwriter through you to the Company expressly for use with
reference to the Underwriter in, any such documents or arises out of or is based
upon any alleged omission to state a material fact in connection with such
information re-
<PAGE>
-12-
quired to be stated in any such documents or necessary to make such information
not misleading.
If any action is brought against an Underwriter or controlling person in
respect of which indemnity may be sought against the Company pursuant to the
foregoing paragraph, such Underwriter shall promptly notify the Company in
writing or by telephone, confirmed in writing, of the institution of such
action, and the Company shall assume the defense of such action, including the
employment of counsel and payment of expenses; provided, however, that the
failure so to notify the Company will not relieve it from any liability that it
may have to such Underwriter under this Section 7(b) unless, and only to the
extent that, such failure results in the forfeiture of substantive rights or
defenses by the Company. Such Underwriter or controlling person shall have the
right to employ its or their own counsel in any such case, but the fees and
expenses of such counsel shall be at the expense of such Underwriter or such
controlling person unless the employment of such counsel shall have been
authorized in writing by the Company in connection with the defense of such
action or the Company shall not have employed counsel to have charge of the
defense of such action or such indemnified party or parties shall have
reasonably concluded that there may be defenses available to it or them which
are different from or additional to those available to the Company (in which
case the Company shall not have the right to direct the defense of such action
on behalf of the indemnified party or parties), in any of which events such fees
and expenses of one counsel for all indemnified parties selected by such
Underwriter shall be borne by the Company. Anything in this paragraph to the
contrary notwithstanding, the Company shall not be liable for any settlement of
any such claim or action effected without its written consent. The Company's
indemnity agreement contained in this Section 7(b) and its warranties and
representations contained in this Agreement shall remain in full force and
effect regardless of any investigation made by or on behalf of any Underwriter
or controlling person, and shall survive any termination of this Agreement and
the issuance and delivery of the Purchased Debt Securities.
The Company agrees promptly to notify the Underwriters of the commencement
of any litigation or proceedings against the Company or any of its officers,
directors or controlling persons in connection with the issue and sale of the
Purchased Debt Securities or with the Registration Statement or Prospectus.
<PAGE>
-13-
8. Warranties and Representations of and Indemnity by Underwriters. (a)
Each Underwriter warrants and represents that the information furnished in
writing by or on behalf of such Underwriter through you to the Company expressly
for use with reference to such Underwriter in the Registration Statement at the
time it became effective or the Prospectus when the Prospectus is first filed
pursuant to Rule 424 under the Act, will not contain an untrue statement of a
material fact and will not omit to state a material fact in connection with such
information required to be stated in the Registration Statement or the
Prospectus or necessary to make such information not misleading. Each
Underwriter, in addition to other information furnished by such Underwriter or
on its behalf through you to the Company in writing expressly for use with
reference to such Underwriter in the Registration Statement and Prospectus,
hereby furnishes to the Company in writing expressly for use with reference to
such Underwriter the statements with respect to the terms of offering of the
Purchased Debt Securities by the Underwriters set forth on the cover page of the
Prospectus and under "Underwriting" therein.
(b) Each Underwriter severally agrees to indemnify and hold harmless the
Company and its directors, officers and controlling persons from and against any
loss, expense, liability or claim which arises out of or is based upon any
alleged untrue statement of a material fact contained in, and in conformity with
information furnished in writing by or on behalf of such Underwriter through you
to the Company expressly for use with reference to such Underwriter in, the
Registration Statement, any prospectus contained in the Registration Statement
at the time it became effective or the Prospectus, or any related preliminary
prospectus, or arises out of or is based upon any alleged omission to state a
material fact in connection with such information required to be stated in such
documents or necessary to make such information not misleading.
If any action is brought against the Company or any such person in respect
of which indemnity may be sought against any Underwriter pursuant to the
foregoing paragraph, the Company or such person shall promptly notify such
Underwriter in writing or by telephone, confirmed in writing, of the institution
of such action, and such Underwriter shall assume the defense of such action,
including the employment of counsel and payment of expenses; provided, however,
that the failure so to notify such Underwriter will not relieve it from any
liability that it may have to the Company under this Section 8(b) unless, and
only to the extent that, such failure results in the forfeiture of substantive
rights or defenses by such Underwriter.
<PAGE>
-14-
The Company or such person shall have the right to employ its or their own
counsel in any such case, but the fees and expenses of such counsel shall be at
the expense of the Company or such person unless the employment of such counsel
shall have been authorized in writing by such Underwriter in connection with the
defense of such action or such Underwriter shall not have employed counsel to
have charge of the defense of such action or such indemnified party or parties
shall have reasonably concluded that there may be defenses available to it or
them which are different from or additional to those available to such
Underwriter (in which case such Underwriter shall not have the right to direct
the defense of such action on behalf of the indemnified party or parties), in
any of which events such fees and expenses of one counsel for all indemnified
parties selected by the Company shall be borne by such Underwriter. Anything in
this paragraph to the contrary notwithstanding, no Underwriter shall be liable
for any settlement of any such claim or action effected without the written
consent of such Underwriter. The indemnity agreement on the part of each
Underwriter contained in this Section 8(b) shall remain in full force and effect
regardless of any investigation made by or on behalf of the Company or such
person, and shall survive any termination of this Agreement and the issuance and
delivery of the Purchased Debt Securities.
Each Underwriter agrees promptly to notify the Company of the commencement
of any litigation or proceedings against the Underwriter in connection with the
issue and sale of the Purchased Debt Securities or with the Registration
Statement or Prospectus.
9. Contribution. If the indemnification provided for in Sections 7(b) or
8(b) above is unavailable in respect of any losses, expenses, liabilities or
claims referred to therein, then the parties entitled to indemnification by the
terms thereof shall be entitled to contribution to liabilities and expenses
except to the extent that contribution is not permitted under Section 11(f) of
the Act. In determining the amount of contribution to which the respective
parties are entitled, there shall be considered the relative benefits received
by each party from the offering of the Purchased Debt Securities (taking into
account the portion of the proceeds of the offering received by each), the
parties' relative knowledge and access to information concerning the matter with
respect to which the claim was asserted, the opportunity to correct and prevent
any misstatement or omission, and any other equitable considerations appropriate
under the circumstances. The parties entitled to indemnification agree that it
would not be eq-
<PAGE>
-15-
uitable if the amount of such contribution were determined by pro rata or per
capita allocation (even if the Underwriters and their directors, officers and
controlling persons were treated as one entity for such purpose). The
contribution agreement contained in this Section 9 shall remain in full force
and effect regardless of any investigation made by or on behalf of any
Underwriter or the Company or any of their respective directors, officers or
controlling persons and shall survive any termination of this Agreement and the
issuance and delivery of the Purchased Debt Securities.
10. Notices. All statements, requests, notices and agreements shall be in
writing or by telegram or facsimile and, if to the Underwriters, shall be
sufficient in all respects if delivered or sent by registered mail to the
address furnished in writing for the purpose of such statements, requests,
notices and agreements hereunder, and, if to the Company shall be sufficient in
all respects if delivered or sent by registered mail to the Company at 200 Park
Avenue, New York, New York 10166, Attention: Treasurer.
11. Construction. This Agreement shall be governed by, and construed in
accordance with, the laws of the State of New York.
The section headings in this Agreement have been inserted as a matter of
convenience of reference and are not a part of this Agreement.
12. Parties in Interest. The Agreement herein set forth has been and is
made solely for the benefit of the Underwriters and the Company, and the
controlling persons, directors and officers referred to in Sections 7, 8 and 9
hereof, and their respective successors, assigns, executors and administrators,
and no other person shall acquire or have any right under or by virtue of this
Agreement. Nothing in this Agreement is intended or shall be construed to give
to any other person, firm or corporation (including, without limitation, any
purchaser of the Purchased Debt Securities from an Underwriter or any subsequent
holder thereof or any purchaser of any Contract Debt Securities or any
subsequent holder thereof) any legal or equitable right, remedy or claim under
or in respect of this Agreement or any provision herein contained.
The term "successor" as used in this Agreement shall not include any
purchaser, as such purchaser, of any Purchased Debt Securities from any
Underwriter or any subsequent holder
<PAGE>
-16-
thereof or any purchaser, as such purchaser, of any Contract Debt Securities or
any subsequent holder thereof.
13. Counterparts. This Agreement may be executed in any number of
counterparts which, taken together, shall constitute one and the same
instrument.
<PAGE>
Schedule I
DELAYED DELIVERY CONTRACT
Dated: ______________, 199_
Sequa Corporation
200 Park Avenue
New York, New York 10166
Attention: Treasurer
Dear Sirs:
The undersigned hereby agrees to purchase from Sequa Corporation (the
"Company"), and the Company agrees to sell to the undersigned,
$___________________
principal amount of the Company's [state title of issue] (the Debt Securities)
offered by the Company's Prospectus dated ____________, 199_ and a Prospectus
Supplement dated ________________, 199 _, receipt of copies of which is hereby
acknowledged, at a purchase price of _____% of the principal amount thereof plus
accrued interest and on the further terms and conditions set forth in this
contract.
The undersigned agrees to purchase such Debt Securities in the principal
amounts and on the delivery dates (the Delivery Dates) set forth below:
Principal Plus Accrued
Delivery Date Amount Interest From:
$
- ----------------------- ----------------------- -----------------------
$
- ----------------------- ----------------------- -----------------------
$
- ----------------------- ----------------------- -----------------------
<PAGE>
-2-
Payment for the Debt Securities which the undersigned has agreed to
purchase on each Delivery Date shall be made to the Company or its order by
certified or bank cashier's check in same day or New York Clearing House funds
(as agreed to by the Company and the undersigned) at the (or at such other place
as the undersigned and the Company shall agree) at 11:00 A.M., New York City
Time, on such Delivery Date upon issuance and delivery to the undersigned of the
Debt Securities to be purchased by the undersigned on such Delivery Date in such
authorized denominations and, unless otherwise provided herein, registered in
such names as the undersigned may designate by written or telegraphic
communications addressed to the Company not less than five full business days
prior to such Delivery Date.
The obligation of the Company to sell and deliver, and of the undersigned
to take delivery of and make payment for, Debt Securities on each Delivery Date
shall be subject to the conditions that (1) the purchase of Debt Securities to
be made by the undersigned shall not at the time of delivery be prohibited under
the laws of the jurisdiction to which the undersigned is subject, (2) the sale
of the Debt Securities by the Company pursuant to this contract shall not at the
time of delivery be prohibited under the laws of any jurisdiction to which the
Company is subject and (3) the Company shall have sold, and delivery shall have
taken place, to the Underwriters such principal amount of the Debt Securities as
is to be sold and delivered to them. In the event that Debt Securities are not
sold to the undersigned because one of the foregoing conditions is not met, the
Company shall not be liable to the undersigned for damages arising out of the
transactions covered by this contract.
Promptly after completion of the sale and delivery to the Underwriters, the
Company will mail or deliver to the undersigned at its address set forth below
notice to such effect, accompanied by copies of the opinions of counsel for the
Company delivered to the Underwriters.
Failure to take delivery of and make payment for Debt Securities by any
purchaser under any other Delayed Delivery Contract shall not relieve the
undersigned of its obligations under this contract.
The undersigned represents and warrants that (a) as of the date of this
contract, the undersigned is not prohibited under the laws of the jurisdictions
to which the undersigned is subject from purchasing the Debt Securities hereby
agreed to be
<PAGE>
-3-
purchased and (b) the undersigned does not contemplate selling the Debt
Securities which it has agreed to purchase hereunder prior to the Delivery Date
therefore.
This contract will inure to the benefit of and be binding upon the parties
hereto and their respective successors, but will not be assignable by either
party hereto without the written consent of the other. This contract shall be
governed by and construed in accordance with the laws of the State of New York.
This contract may be executed in one or more counterparts, each of which shall
be deemed an original, but all of which together shall constitute one and the
same instrument.
It is understood that the acceptance of any Delayed Delivery Contract is in
the Company's sole discretion and, without limiting the foregoing, need not be
on a first-come, first-served basis. If the contract is acceptable to the
Company, it is requested that the Company sign the form of acceptance below and
mail or deliver one of the counterparts hereof to the undersigned at its address
set forth below. This will become a binding contract between the Company and the
undersigned when such counterpart is so signed.
Yours very truly,
____________________________________
By ________________________________
____________________________________
____________________________________
Address
Accepted, as of the date first above written
SEQUA CORPORATION
By ________________________________
Title _____________________________
<PAGE>
-4-
PURCHASER -- PLEASE COMPLETE AT TIME OF SIGNING
The name and telephone and department of the representative of the
Purchaser with whom details of delivery on the Delivery Date may be discussed
are as follows:
(Please print.)
Telephone No.
Name (Including Area Code) Department
---- --------------------- ----------
<PAGE>
SEQUA CORPORATION
PURCHASE AGREEMENT
DEBT SECURITIES
--------------------
Date)
Sequa Corporation
200 Park Avenue
New York, New York 10166
Dear Sirs:
Referring to the Debt Securities of Sequa Corporation (the "Company")
("Debt Securities") covered by registration statement on Form S-3 (No. 333- ),
such registration statement including (i) the prospectus included therein, dated
________________, as supplemented by a prospectus supplement dated
________________, in the form filed under Rule 424(b) and any additional
prospectus supplements relating to the Debt Securities filed under Rule 424
(such prospectus as so supplemented, including each document incorporated by
reference therein is hereinafter called the "Prospectus") and (ii) all documents
filed as part thereof or incorporated by reference therein, is hereinafter
called the "Registration Statement," on the basis of the representations,
warranties and agreements contained in this Agreement, but subject to the terms
and conditions herein set forth, the purchaser or purchasers named in Schedule A
hereto (the "Underwriters") agree to purchase, severally, and the Company agrees
to sell to the Underwriters, severally, the respective principal amounts of the
Debt Securities having the terms described below (the "Purchased Debt
Securities") set forth opposite the name of each Underwriter on Schedule A
hereto.
The price at which the Purchased Debt Securities shall be purchased from
the Company by the Underwriters shall be ___% plus accrued interest from
_________________. The initial public offering price shall be ___% plus accrued
interest from ___________. The Purchased Debt Securities will be offered by the
Underwriters as set forth in the Prospectus relating to such Purchased Debt
Securities.
<PAGE>
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The Purchased Debt Securities will have the following terms:
Title of Debt Securities:
----------------------------------
Interest Rate: _____% per annum
Interest Payment Dates:
----------------------------------
Maturity:
----------------------------------
Redemption Provisions:
----------------------------------
----------------------------------
----------------------------------
Company Conversion Option:
----------------------------------
----------------------------------
----------------------------------
Other:
----------------------------------
----------------------------------
----------------------------------
----------------------------------
----------------------------------
----------------------------------
----------------------------------
Payment for the Purchased Debt
Securities shall be made in the
following funds:
----------------------------------
The time of purchase shall be:
----------------------------------
The place at which the
Purchased Debt Securities may
be checked and packaged shall be:
----------------------------------
The place(s) at which the
Purchased Debt Securities shall
be delivered and sold shall be:
----------------------------------
<PAGE>
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Delayed Delivery
Contracts: [authorized] [not authorized]
[Delivery Date ----------------------------------
Minimum principal amount of
Purchased Debt Securities to be
sold pursuant to any Delayed
Delivery Contract:
----------------------------------
Maximum aggregate principal
amount of Purchased Debt
Securities to be sold pursuant
to all Delayed Delivery
Contracts:
----------------------------------
Compensation to
Underwriters: ]*
----------------------------------
Notices to the Underwriters shall be sent to the following address(es) or
telecopier number(s):
If we are acting as Representative(s) for the several Underwriters named in
Schedule A hereto, we represent that we are authorized to act for such several
Underwriters in connection with the transactions contemplated in this Agreement,
and that, if there are more than one of us, any action under this Agreement
taken by any of us will be binding upon all the Underwriters.
All of the provisions contained in the document entitled "Sequa
Corporation, Debt Securities, Standard Purchase Provisions," a copy of which has
been previously furnished to us, are hereby incorporated by reference in their
entirety and shall be deemed to be a part of this Agreement to the same extent
as if such provisions had been set forth in full herein.
<PAGE>
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If the foregoing is in accordance with your understanding of our agreement,
kindly sign and return to us the enclosed duplicate hereof, whereupon it will
become a binding agreement between the Company and the several Underwriters in
accordance with its terms.
Very truly yours,
[Firm Name]
By _____________________________
Title: ____________________
[Firm Name]
By ____________________________
Title: ____________________
Acting on behalf of and as
Representative(s) of the several
Underwriters named in Schedule A
hereto.*
- ----------
* To be deleted if the Purchase Agreement is not executed by one or more
Underwriters acting as Representative(s) of the Underwriters for purposes
of this Agreement.
<PAGE>
-5-
The foregoing Purchase Agreement
is hereby confirmed as of the date
first above written.
SEQUA CORPORATION
By _____________________________________
Title __________________________________
<PAGE>
SCHEDULE A
Name of Underwriter Amount
- ------------------- ------
-----------------------------
Total $
-----------------------------
EXHIBIT 4(a)
SEQUA CORPORATION
DEBT SECURITIES
INDENTURE
Dated as of , 1998
Bank of Montreal Trust Company, Trustee
<PAGE>
PARTIAL CROSS-REFERENCE TABLE
Indenture Section TIA Section
2.05............................................ 317(b)
2.06............................................ 312(a)
2.11............................................ 316(a) (last sentence)
4.05............................................ 314(a)(4)
6.03............................................ 317(a)(1)
6.04............................................ 316(a)(1)(B)
6.06............................................ 316(a)(1)(A)
6.07............................................ 317(a)(1)
7.01............................................ 315(a), 315(d)
7.04............................................ 315(b)
7.05............................................ 313(a)
7.07............................................ 310(a), 310(b)
7.09............................................ 310(a)(2)
8.02............................................ 310(a), 310(b)
9.04............................................ 316(c)
10.01........................................... 318(a)
10.02........................................... 313(c)
10.03........................................... 314(c)(1), 314(c)(2)
10.04........................................... 314(e)
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<PAGE>
TABLE OF CONTENTS
Page
ARTICLE 1 --DEFINITIONS.......................................................1
SECTION 1.01. Definitions. ..................................................1
SECTION 1.02. Other Definitions..............................................4
SECTION 1.03. Rules of Construction..........................................4
ARTICLE 2 --THE SECURITIES....................................................5
SECTION 2.01. Issuable in Series.............................................5
SECTION 2.02. Execution and Authentication...................................7
SECTION 2.03. Agents. .......................................................8
SECTION 2.04. Bearer Securities..............................................8
SECTION 2.05. Paying Agent to Hold Money in Trust............................9
SECTION 2.06. Securityholder Lists...........................................9
SECTION 2.07. Transfer and Exchange.........................................10
SECTION 2.08. Replacement Securities........................................11
SECTION 2.09. Outstanding Securities........................................11
SECTION 2.10. Discounted Debt Securities....................................11
SECTION 2.11. Treasury Securities...........................................12
SECTION 2.12. Global Securities.............................................12
SECTION 2.13. Temporary Securities..........................................13
SECTION 2.14. Cancellation. 13
SECTION 2.15. Defaulted Interest............................................13
ARTICLE 3 --REDEMPTION.......................................................14
SECTION 3.01. Notices to Trustee............................................14
SECTION 3.02. Selection of Securities to Be Redeemed........................14
SECTION 3.03. Notice of Redemption..........................................14
SECTION 3.04. Effect of Notice of Redemption................................15
SECTION 3.05. Payment of Redemption Price...................................16
SECTION 3.06. Securities Redeemed in Part...................................16
ARTICLE 4 --COVENANTS........................................................17
SECTION 4.01. Payment of Securities.........................................17
-ii-
<PAGE>
Page
SECTION 4.02. Overdue Interest..............................................17
SECTION 4.03. Compliance Certificate........................................17
SECTION 4.04. SEC Reports. .................................................17
ARTICLE 5 --SUCCESSORS.......................................................18
SECTION 5.01. When Company May Merge, etc...................................18
ARTICLE 6 --DEFAULTS AND REMEDIES............................................18
SECTION 6.01. Events of Default.............................................18
SECTION 6.02. Acceleration. ................................................20
SECTION 6.03. Other Remedies................................................20
SECTION 6.04. Waiver of Past Defaults.......................................21
SECTION 6.05. Control by Majority...........................................21
SECTION 6.06. Limitation on Suits...........................................21
SECTION 6.07. Collection Suit by Trustee....................................22
SECTION 6.08. Priorities. ..................................................22
ARTICLE 7 --TRUSTEE..........................................................23
SECTION 7.01. Rights of Trustee.............................................23
SECTION 7.02. Individual Rights of Trustee..................................24
SECTION 7.03. Trustee's Disclaimer..........................................24
SECTION 7.04. Notice of Defaults............................................24
SECTION 7.05. Reports by Trustee to Holders.................................25
SECTION 7.06. Compensation and Indemnity....................................25
SECTION 7.07. Replacement of Trustee........................................26
SECTION 7.08. Successor Trustee by Merger, etc..............................27
SECTION 7.09. Trustee's Capital and Surplus.................................27
ARTICLE 8 --DISCHARGE OF INDENTURE...........................................27
SECTION 8.01. Defeasance. ..................................................27
SECTION 8.02. Conditions to Defeasance......................................28
SECTION 8.03. Application of Trust Money....................................29
SECTION 8.04. Repayment to Company..........................................29
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<PAGE>
Page
ARTICLE 9 --AMENDMENTS.......................................................30
SECTION 9.01. Without Consent of Holders....................................30
SECTION 9.02. With Consent of Holders.......................................30
SECTION 9.03. Compliance with Trust Indenture Act...........................31
SECTION 9.04. Effect of Consents............................................31
SECTION 9.05. Notation on or Exchange of Securities.........................32
SECTION 9.06. Trustee Protected.............................................32
ARTICLE 10 --MISCELLANEOUS...................................................32
SECTION 10.01. Trust Indenture Act..........................................32
SECTION 10.02. Notices. ....................................................33
SECTION 10.03. Certificate and Opinion as to Conditions Precedent...........34
SECTION 10.04. Statements Required in Certificate or Opinion................34
SECTION 10.05. Rules by Company and Agents..................................35
SECTION 10.06. No Lien Created, etc.........................................35
SECTION 10.07. Legal Holidays...............................................35
SECTION 10.08. No Recourse Against Others...................................35
SECTION 10.09. Duplicate Originals..........................................35
SECTION 10.10. Governing Law................................................35
-iv-
<PAGE>
INDENTURE dated as of , 1998 between SEQUA CORPORATION, a corporation
organized and existing under the laws of the State of Delaware (hereinafter
called the "Company"), and BANK OF MONTREAL TRUST COMPANY, a New York banking
corporation, as Trustee ("Trustee").
Each party agrees as follows for the benefit of the Holders of the
Company's debt securities issued under this Indenture:
ARTICLE 1 -- DEFINITIONS
SECTION 1.01. Definitions.
"Affiliate" means any person directly or indirectly controlling or
controlled by or under direct or indirect common control with the Company.
"Agent" means any Registrar or Paying Agent.
"Authorized Newspaper" means a newspaper that is:
(1) printed in the English language or in an official language of the
country of publication;
(2) customarily published on each business day in the place of
publication; and
(3) of general circulation in the relevant place or in the financial
community of such place.
Whenever successive publications in an Authorized Newspaper are required,
they may be made on the same or different business days and in the same or
different Authorized Newspapers.
"Bearer Security" means a Security payable to bearer.
"Board" means the Board of Directors of the Company or any authorized
committee of the Board.
"Capital Stock" means any and all shares, interests, participations or
other equivalents (however designated) of capital stock of any person and all
warrants or options to acquire such capital stock.
<PAGE>
-2-
"Company" means the party named as such above until a successor replaces it
and thereafter means the successor.
"Corporate Trust Office" shall mean the principal office of the Trustee at
which at any particular time its corporate trust business shall be administered,
which office at the date of the execution of this Indenture is located at Wall
Street Plaza, 88 Pine Street, New York, New York 10005, Attention: Corporate
Trust Department, or at any other time at such other address as the Trustee may
designate from time to time by notice to the Holders.
"coupon" means an interest coupon for a Bearer Security.
"Default" means any event which is, or after notice or passage of time
would be, an Event of Default (as defined below).
"Discounted Debt Security" means a Security where the amount of principal
due upon acceleration is less than the stated principal amount.
"Holder" or "Securityholder" means the person in whose name a Registered
Security is registered and the bearer of a Bearer Security or coupon.
"Indenture" means this Indenture and any Securities Resolution as amended
from time to time.
"Lien" means mortgage, pledge, security interest or other lien.
"Officer" means the Chairman, any Vice-Chairman, the President, any
Executive or Senior Vice President, any Vice-President, the Treasurer or any
Assistant Treasurer, the Secretary or any Assistant Secretary of the Company.
"Officers' Certificate" means a certificate signed by two Officers of the
Company, and delivered to the Trustee.
"Opinion of Counsel" means a written opinion from legal counsel who is
acceptable to the Trustee, and delivered to the Trustee. The counsel may be an
employee of or counsel to the Company or the Trustee.
"person" means any individual, corporation, partnership, joint venture,
association, joint-stock company, trust,
<PAGE>
-3-
unincorporated organization or government or any agency or political subdivision
thereof.
"principal" of a debt security means the principal of the security plus the
premium, if and when applicable, on the security.
"Registered Security" means a Security registered as to principal and
interest by the Registrar.
"SEC" means the Securities and Exchange Commission.
"Securities" means the debt securities issued under this Indenture.
"Securities Resolution" means a resolution authorizing a series adopted by
the Board or by a committee of Officers or an Officer pursuant to Board
delegation.
"series" means a series of Securities or the Securities of the series.
"Subsidiary" of any person means (i) a corporation more than 50% of the
outstanding voting stock of which is owned, directly or indirectly, by such
person or by one or more other Subsidiaries of such person or by such person and
one or more Subsidiaries thereof or (ii) any other person (other than a
corporation) in which such person, or one or more Subsidiaries of such person or
such person and one or more Subsidiaries thereof, directly or indirectly, has at
least a majority ownership and power to direct the policy, management and
affairs thereof.
"TIA" means the Trust Indenture Act of 1939 (15 U.S. Code ss.
77aaa-77bbbb), as amended.
"Trading Day" means each day on which the securities exchange or quotation
system which is used to determine the Market Price is open for trading or
quotation.
"Trustee" means the party named as such above until a successor replaces it
and thereafter means the successor.
"Trust Officer" when used with respect to the Trustee, means any officer
assigned to the Corporate Trust Office, including any managing director, vice
president, assistant vice president, assistant treasurer, assistant secretary or
any other officer of the Trustee customarily performing functions
<PAGE>
-4-
similar to those performed by any of the above designated officers and having
direct responsibility for the administration of this Indenture, and also, with
respect to a particular matter, any other officer, to whom such matter is
referred because of such officer's knowledge of and familiarity with the
particular subject.
"United States" means the United States of America, its territories and
possessions and other areas subject to its jurisdiction.
SECTION 1.02. Other Definitions.
Term Defined in Section
"actual knowledge" 7.01
"Bankruptcy Law" 6.01
"Conditional Redemption" 3.04
"Custodian" 6.01
"Legal Holiday" 10.06
"Paying Agent" 2.03
"Registrar" 2.03
"Treasury Regulations" 2.04
"U.S. Government Obligations" 8.02
SECTION 1.03. 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 generally accepted accounting principles in the
United States;
(3) generally accepted accounting principles are those applicable from
time to time;
(4) all terms used in this Indenture that are defined by the TIA, defined
by TIA reference to another statute or defined by SEC rule under the
TIA have the meanings assigned to them by such definitions;
(5) "or" is not exclusive; and
<PAGE>
-5-
(6) words in the singular include the plural, and in the plural include
the singular.
ARTICLE 2 -- THE SECURITIES
SECTION 2.01. Issuable in Series.
The aggregate principal amount of Securities that may be issued under this
Indenture is unlimited. The Securities may be issued from time to time in one or
more series. Each series shall be created by a Securities Resolution that
establishes the terms of the series, which may include the following:
(1) the title of the series;
(2) the aggregate principal amount of the series;
(3) the interest rate, if any, or method of calculating the interest rate;
(4) the date from which interest will accrue;
(5) the record dates for interest payable on Registered Securities;
(6) the dates when principal and interest are payable;
(7) the manner of paying principal and interest;
(8) the places where principal and interest are payable;
(9) the Registrar and Paying Agent;
(10) the terms of any mandatory or optional redemption by the Company or
any third party including any sinking fund;
(11) the terms of any redemption at the option of Holders or put by the
Holders;
(12) the denominations in which Securities are issuable;
<PAGE>
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(13) whether Securities will be issuable as Registered Securities, Bearer
Securities or uncertificated Securities;
(14) whether and upon what terms Registered Securities, Bearer Securities
and uncertificated Securities may be exchanged;
(15) whether any Securities will be represented by a Security in global
form;
(16) the terms of any global Security;
(17) the terms of any tax indemnity;
(18) the currencies (including any composite currency) in which principal
or interest may be paid;
(19) if payments of principal or interest may be made in a currency other
than that in which Securities are denominated, the manner for
determining such payments;
(20) if amounts of principal or interest may be determined by reference to
an index, formula or other method, the manner for determining such
amounts;
(21) provisions for electronic issuance of Securities or for Securities in
uncertificated form;
(22) the portion of principal payable upon acceleration of a Discounted
Debt Security;
(23) whether any Events of Default or covenants in addition to or in lieu
of those set forth in this Indenture have been added;
(24) whether and upon what terms Securities may be defeased;
(25) the forms of the Securities or any coupon, which may be in the form of
Exhibit A or B;
(26) any terms that may be required by or advisable under U.S. laws; and
<PAGE>
-7-
(27) any other terms not inconsistent with this Indenture.
All Securities of one series need not be issued at the same time and,
unless otherwise provided, a series may be reopened for issuances of additional
Securities of such series.
The creation and issuance of a series and the authentication and delivery
thereof are not subject to any conditions precedent.
SECTION 2.02. Execution and Authentication.
Two Officers shall sign the Securities by manual or facsimile signature.
The Company's seal shall be reproduced on the Securities. An Officer shall sign
any coupons by facsimile signature.
If an Officer whose signature is on a Security or its coupons no longer
holds that office at the time the Security is authenticated or delivered, the
Security and coupons shall nevertheless be valid.
A Security and its coupons shall not be valid until the Security is
authenticated by the manual signature of the Trustee. The signature shall be
conclusive evidence that the Security has been authenticated under this
Indenture.
Each Registered Security shall be dated the date of its authentication.
Each Bearer Security shall be dated the date of its original issuance or as
provided in the Securities Resolution.
Securities may have notations, legends or endorsements required by law,
stock exchange rule, agreement or usage.
In the event Securities are issued in electronic or other uncertificated
form, such Securities may be validly issued without the signatures or seal
contemplated by this Section 2.02.
The Trustee may appoint an authenticating agent acceptable to the Company
to authenticate Securities. An authenticating agent may authenticate Securities
whenever the Trustee may do so. Each reference in this Indenture to
authentication by the Trustee includes authentication by such agent. An
authenticating agent has the same rights as an Agent to deal with the Company or
an Affiliate.
<PAGE>
-8-
SECTION 2.03. Agents.
The Company shall maintain an office or agency where Securities may be
presented for registration of transfer or for exchange ("Registrar") and an
office or agency where Securities may be presented for payment ("Paying Agent").
The Registrar shall keep a register of the Securities and of their transfer and
exchange.
The Company may appoint more than one Registrar or Paying Agent for a
series. The Company shall notify the Trustee of the name and address of any
Agent not a party to this Indenture. If the Company does not appoint or maintain
a Registrar or Paying Agent for a series, the Trustee shall act as such.
SECTION 2.04. Bearer Securities.
U.S. laws and Treasury Regulations restrict sales or exchanges of and
payments on Bearer Securities. Therefore, except as provided below:
(1) Bearer Securities will be offered, sold or delivered only outside the
United States and will be delivered in connection with its original
issuance only upon presentation of a certificate in a form prescribed
by the Company to comply with U.S. laws and regulations.
(2) Bearer Securities will not be issued in exchange for Registered
Securities.
(3) All payments of principal and interest (including original issue
discount) on Bearer Securities will be made outside the United States
by a Paying Agent located outside the United States unless the Company
determines that:
(A) such payments may not be made by such Paying Agent because the
payments are illegal or prevented by exchange controls as
described in Treasury Regulation ss. 1.163-5(c)(2)(v); and
(B) making the payments in the United States would not have an
adverse tax effect on the Company.
<PAGE>
-9-
If there is a change in the relevant provisions of U.S. laws or Treasury
Regulations or the judicial or administrative interpretation thereof, a
restriction set forth in paragraph (1), (2) or (3) above will not apply to a
series if the Company determines that the relevant provisions no longer apply to
the series or that failure to comply with the relevant provisions would not have
an adverse tax effect on the Company or on Securityholders or cause the series
to be treated as "registration-required" obligations under U.S. law.
The Company shall notify the Trustee of any determinations by the Company
under this Section.
"Treasury Regulations" means regulations of the U.S. Treasury Department
under the Internal Revenue Code of 1986, as amended.
SECTION 2.05. Paying Agent to Hold Money in Trust.
The Company shall require each Paying Agent for a series other than the
Trustee to agree in writing that the Paying Agent will hold in trust for the
benefit of the persons entitled thereto all money held by the Paying Agent for
the payment of principal of or interest on the series, and will notify the
Trustee of any default by the Company in making any such payment.
While any such default continues, the Trustee may require a Paying Agent to
pay all money so held by it to the Trustee. The Company at any time may require
a Paying Agent to pay all money held by it to the Trustee. Upon payment over to
the Trustee, the Paying Agent shall have no further liability for the money.
If the Company or an Affiliate acts as Paying Agent for a series, it shall
segregate and hold as a separate trust fund all money held by it as Paying Agent
for the series.
SECTION 2.06. Securityholder Lists.
The Trustee shall preserve in as current a form as is reasonably
practicable the most recent list available to it of the names and addresses of
Securityholders. If the Trustee is not the Registrar, the Company shall furnish
to the Trustee semiannually and at such other times as the Trustee may request a
list in such form and as of such date as the Trustee may reasonably require of
the names and addresses of Holders of Regis-
<PAGE>
-10-
tered Securities and Holders of Bearer Securities whose names are on the list
referred to below.
The Registrar shall keep a list of the names and addresses of Holders of
Bearer Securities who file a request to be included on such list. A request will
remain in effect for two years, and successive requests may be made.
Whenever the Company or the Trustee is required to mail a notice to all
Holders of Registered Securities of a series, it also shall mail the notice to
Holders of Bearer Securities of the series whose names are on the list.
Whenever the Company is required to publish a notice to all Holders of
Bearer Securities of a series, it also shall mail the notice to such of them
whose names are on the list.
SECTION 2.07. Transfer and Exchange.
Where Registered Securities of a series are presented to the Registrar with
a request to register a transfer or to exchange them for an equal principal
amount of Registered Securities of other denominations of the same series, the
Registrar shall register the transfer or make the exchange if its requirements
for such transactions are met. To permit registrations of transfer and
exchanges, the Trustee shall authenticate Registered Securities and Bearer
Securities at the Registrar's request.
The Registrar may require a Holder to pay a sum sufficient to cover any
taxes imposed on a transfer or exchange.
If a series provides for Registered and Bearer Securities and for their
exchange, Bearer Securities may be exchanged for Registered Securities and
Registered Securities may be exchanged for Bearer Securities as provided in the
Securities or the Securities Resolution if the requirements of the Registrar for
such transactions are met and in the case of the exchange of registered
securities for bearer securities if Section 2.04 permits the exchange.
The Company may elect not to exchange or register the transfer of any
Security for a period of 15 days before a selection of Securities to be
redeemed.
<PAGE>
-11-
SECTION 2.08. Replacement Securities.
If the Holder of a Security or coupon claims that it has been lost,
destroyed or wrongfully taken, then, in the absence of notice to the Company or
the Trustee that the Security or coupon has been acquired by a protected
purchaser, the Company shall issue a replacement Security or coupon if the
Company and the Trustee receive:
(1) evidence satisfactory to them of the loss, destruction or taking;
(2) an indemnity bond satisfactory to them; and
(3) payment of a sum sufficient to cover their expenses and any taxes for
replacing the Security or coupon.
A replacement Security shall have coupons attached corresponding to those, if
any, on the replaced Security.
Every replacement Security or coupon is an additional obligation of the
Company.
SECTION 2.09. Outstanding Securities.
The Securities outstanding at any time are all the Securities authenticated
by the Trustee except for those cancelled by it, those delivered to it for
cancellation, and those described in this Section as not outstanding.
If a Security is replaced pursuant to Section 2.08, it ceases to be
outstanding unless the Trustee and the Company receive proof satisfactory to
them that the replaced Security is held by a protected purchaser.
If Securities are considered paid under Section 4.01, they cease to be
outstanding and interest on them ceases to accrue.
A Security does not cease to be outstanding because the Company or an
Affiliate holds the Security.
SECTION 2.10. Discounted Debt Securities.
In determining whether the Holders of the required principal amount of
Securities have concurred in any direction, waiver or consent, the principal
amount of a Discounted Debt
<PAGE>
-12-
Security shall be the amount of principal that would be due as of the date of
such determination if payment of the Security were accelerated on that date.
SECTION 2.11. Treasury Securities.
In determining whether the Holders of the required principal amount of
Securities have concurred in any direction, waiver or consent, Securities owned
by the Company or an Affiliate shall be disregarded, except that for the
purposes of determining whether the Trustee shall be protected in relying on any
such direction, waiver or consent, only Securities which the Trustee actually
knows are so owned shall be so disregarded.
SECTION 2.12. Global Securities.
If the Securities Resolution so provides, the Company may issue some or all
of the Securities of a series in temporary or permanent global form. A global
Security may be in registered form, in bearer form with or without coupons or in
uncertificated form. A global Security shall represent that amount of Securities
of a series as specified in the global Security or as endorsed thereon from time
to time. At the Company's request, the Trustee shall endorse a global Security
to reflect the amount of any increase or decrease in the Securities represented
thereby.
The Company may issue a global Security only to a depository designated by
the Company. A depository may transfer a global Security only as a whole to its
nominee or to a successor depository.
The Securities Resolution may establish, among other things, the manner of
paying principal and interest on a global Security and whether and upon what
terms a beneficial owner of an interest in a global Security may exchange such
interest for definitive Securities.
The Company, an Affiliate, the Trustee and any Agent shall not be
responsible for any acts or omissions of a depository, for any depository
records of beneficial ownership interests or for any transactions between the
depository and beneficial owners.
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SECTION 2.13. Temporary Securities.
Until definitive Securities of a series are ready for delivery, the Company
may use temporary Securities. Temporary Securities shall be substantially in the
form of definitive Securities but may have variations that the Company considers
appropriate for temporary Securities. Temporary Securities may be in global
form. Temporary Bearer Securities may have one or more coupons or no coupons.
Without unreasonable delay, the Company shall prepare and the Trustee shall
authenticate definitive Securities in exchange for temporary Securities.
SECTION 2.14. Cancellation.
The Company at any time may deliver Securities to the Trustee for
cancellation. The Registrar and the Paying Agent shall forward to the Trustee
any Securities and coupons surrendered to them for payment, exchange or
registration of transfer. The Trustee shall cancel all Securities or coupons
surrendered for payment, registration of transfer, exchange or cancellation. The
Trustee also will cancel all Bearer Securities and unmatured coupons unless the
Company requests the Trustee to hold the same for redelivery. Any Bearer
Securities so held shall be considered delivered for cancellation under Section
2.09. The Trustee shall dispose of cancelled Securities and coupons in
accordance with its record retention policies in effect at the time or shall
deliver them to the Company upon the written request of the Company.
Unless the Securities Resolution otherwise provides, the Company may not
issue new Securities to replace Securities that the Company has paid or that the
Company has delivered to the Trustee for cancellation.
SECTION 2.15. Defaulted Interest.
If the Company defaults in a payment of interest on Registered Securities,
it need not pay the defaulted interest to Holders on the regular record date.
The Company may fix a special record date for determining Holders entitled to
receive defaulted interest, or the Company may pay defaulted interest in any
other lawful manner. At least ___ days before the special record date, the
Company shall give the Holders of Registered Securities a notice that states the
record date, payment date and amount of interest to be paid.
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ARTICLE 3 -- REDEMPTION
SECTION 3.01. Notices to Trustee.
Securities of a series that are redeemable before maturity shall be
redeemable in accordance with their terms and, unless the Securities Resolution
otherwise provides, in accordance with this Article.
In the case of a redemption by the Company, the Company shall notify the
Trustee of the redemption date and the principal amount of Securities to be
redeemed. The Company shall notify the Trustee at least 35 days before the
redemption date unless a shorter notice is satisfactory to the Trustee.
If the Company is required to redeem Securities, it may reduce the
principal amount of Securities required to be redeemed to the extent that it is
permitted a credit against such redemption requirement by the terms of the
Securities Resolution and notifies the Trustee of the amount of such credit and
the basis for it. If the reduction is based on a credit for acquired or redeemed
Securities that the Company has not previously delivered to the Trustee for
cancellation, the Company shall deliver the Securities at the same time as the
notice.
SECTION 3.02. Selection of Securities to Be Redeemed.
If less than all the Securities of a series are to be redeemed, the Trustee
shall select the Securities to be redeemed from Securities outstanding not
previously called for redemption by a method the Trustee considers fair and
appropriate. The Trustee shall make the selection from Securities of the series
outstanding not previously called for redemption. The Trustee may select for
redemption portions of the principal of Securities having denominations larger
than the minimum denomination for the series. Securities and portions thereof
selected for redemption shall be in amounts equal to the minimum denomination
for the series or an integral multiple thereof. Provisions of this Indenture
that apply to Securities called for redemption also apply to portions of
Securities called for redemption.
SECTION 3.03. Notice of Redemption.
At least 30 days before a redemption date, the Company shall mail a notice
of redemption by first-class mail to
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each Holder of Registered Securities whose Securities are to be redeemed.
If Bearer Securities are to be redeemed, the Company shall publish a notice
of redemption in an Authorized Newspaper as provided in the Securities.
A notice shall identify the Securities of the series to be redeemed and
shall state:
(1) the redemption date;
(2) the redemption price;
(3) the name and address of the Paying Agent;
(4) that Securities called for redemption, together with all coupons, if
any, maturing after the redemption date, must be surrendered to the
Paying Agent to collect the redemption price;
(5) that interest on Securities called for redemption ceases to accrue on
and after the redemption date;
(6) whether the redemption by the Company is mandatory or optional; and
(7) whether the redemption is conditional as provided in Section 3.04, and
if so, the terms of the conditions, and that, if the conditions are
not satisfied or are not waived by the Company, the Securities will
not be redeemed and such a failure to redeem will not constitute an
Event of Default.
A redemption notice given by publication need not identify Registered
Securities to be redeemed.
At the Company's request, the Trustee shall give the notice of redemption
in the Company's name and at its expense.
SECTION 3.04. Effect of Notice of Redemption.
Except as provided below, once notice of redemption is given, Securities
called for redemption become due and payable on the redemption date at the
redemption price stated in the notice.
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A notice of redemption may provide that it is subject to the occurrence of
any event before the date fixed for such redemption as described in such notice
("Conditional Redemption"), and such notice of Conditional Redemption shall be
of no effect unless all such conditions to the redemption have occurred on or
before such date or have been waived by the Company in its sole discretion.
SECTION 3.05. Payment of Redemption Price.
On or before the redemption date, the Company shall deposit with the Paying
Agent money sufficient to pay the redemption price of and accrued interest on
all Securities to be redeemed on that date.
When the Holder of a Security surrenders it for redemption in accordance
with the redemption notice, the Company shall pay to the Holder on the
redemption date the redemption price and accrued interest to such date, except
that:
(1) the Company will pay any such interest (except defaulted interest) to
Holders on the record date of Registered Securities if the redemption
date occurs on an interest payment date; and
(2) the Company will pay any such interest to Holders of coupons that
mature on or before the redemption date upon surrender of such coupons
to the Paying Agent.
Coupons maturing after the redemption date on a called Security are void
absent a payment default on that date. Nevertheless, if a Holder surrenders for
redemption a Bearer Security missing any such coupons, the Company may deduct
the face amount of such coupons from the redemption price. If thereafter the
Holder surrenders to the Paying Agent the missing coupons, the Company will
return the amount so deducted. The Company may waive surrender of the missing
coupons if it receives an indemnity bond satisfactory to the Company.
SECTION 3.06. Securities Redeemed in Part.
Upon surrender of a Security that is redeemed in part, the Trustee shall
authenticate for the Holder and the Company shall deliver to the Holder a new
Security of the same series equal in principal amount to the unredeemed portion
of the Security surrendered.
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ARTICLE 4 -- COVENANTS
SECTION 4.01. Payment of Securities.
The Company shall pay the principal of and interest on a series in
accordance with the terms of the Securities for the series, any related coupons,
and this Indenture. Principal and interest on a series shall be considered paid
on the date due if the Paying Agent for the series holds on that date money
sufficient to pay all principal and interest then due on the series.
SECTION 4.02. Overdue Interest.
Unless the Securities Resolution otherwise provides, the Company shall pay
interest on overdue principal of a Security of a series at the rate (or yield to
maturity in the case of a Discounted Debt Security) borne by the series; the
Company shall pay interest on overdue installments of interest at the same rate
or yield to maturity to the extent lawful.
SECTION 4.03. Compliance Certificate.
The Company shall deliver to the Trustee, within 120 days after the end of
each fiscal year of the Company, a brief certificate signed by the principal
executive officer, principal financial officer or principal accounting officer
of the Company, as to the signer's knowledge of the Company's compliance with
all conditions and covenants under this Indenture (determined without regard to
any period of grace or requirement of notice provided herein).
Any other obligor on the Securities shall also deliver to the Trustee such
a certificate as to its compliance with this Indenture within 120 days after the
end of each of its fiscal years.
The certificates need not comply with Section 10.04.
SECTION 4.04. SEC Reports.
The Company shall file with the Trustee, within 15 days after the Company
is required to file the same with the SEC, copies of the annual reports and of
the information, documents, and other reports (or such portions of the foregoing
as the SEC may prescribe) which the Company is required to file
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with the SEC pursuant to Section 13 or 15(d) of the Securities Exchange Act of
1934.
Any other obligor on the Securities shall do likewise as to the above items
which it is required to file with the SEC pursuant to those sections.
ARTICLE 5 -- SUCCESSORS
SECTION 5.01. When Company May Merge, etc.
Unless the Securities Resolution establishing a series otherwise provides
with respect to that series, the Company shall not consolidate with or merge
into, or transfer all or substantially all of its assets to, any person in any
transaction in which the Company is not the survivor unless:
(1) the person is organized under the laws of the United States or a State
thereof or is organized under the laws of a foreign jurisdiction and
consents to the jurisdiction of the courts of the United States or a
State thereof;
(2) the person assumes by supplemental indenture all the obligations of
the Company under this Indenture, the Securities and any coupons; and
(3) immediately after the transaction no Default exists.
The successor shall be substituted for the Company, and thereafter all
obligations of the Company under this Indenture, the Securities and any coupons
shall terminate.
ARTICLE 6 -- DEFAULTS AND REMEDIES
SECTION 6.01. Events of Default.
Unless the Securities Resolution otherwise provides, an "Event of Default"
on a series occurs if:
(1) the Company defaults in any payment of interest on any Securities of
the series when the same
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becomes due and payable and the Default continues for a period of 60
days;
(2) the Company defaults in the payment of the principal and premium, if
any, of any Securities of the series when the same becomes due and
payable at maturity or upon redemption, acceleration or otherwise, and
such default shall continue for five or more days;
(3) the Company defaults in the payment or satisfaction of any sinking
fund obligation with respect to any Securities of the series as
required by the Securities Resolution establishing such series and the
Default continues for a period of 60 days;
(4) the Company defaults in the performance of any of its other agreements
applicable to the series and the Default continues for 90 days after
the notice specified below;
(5) the Company pursuant to or within the meaning of any Bankruptcy Law:
(A) commences a voluntary case,
(B) consents to the entry of an order for relief against it in an
involuntary case,
(C) consents to the appointment of a Custodian for it or for all or
substantially all of its property, or
(D) makes a general assignment for the benefit of its creditors;
(6) a court of competent jurisdiction enters an order or decree under any
Bankruptcy Law that:
(A) is for relief against the Company in an involuntary case,
(B) appoints a Custodian for the Company or for all or substantially
all of its property, or
(C) orders the liquidation of the Company;
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and the order or decree remains unstayed and in effect for 60
days; or
(7) there occurs any other Event of Default provided for in the series.
The term "Bankruptcy Law" means Title 11, U.S. Code or any similar Federal
or State law for the relief of debtors. The term "Custodian" means any receiver,
trustee, assignee, liquidator or a similar official under any Bankruptcy Law.
A Default under clause (4) is not an Event of Default until the Trustee or
the Holders of at least 33-1/3% in principal amount of the series notify the
Company of the Default and the Company does not cure the Default within the time
specified after receipt of the notice. The notice must specify the Default,
demand that it be remedied and state that the notice is a "Notice of Default."
If Holders notify the Company of a Default, they shall notify the Trustee at the
same time.
The failure to redeem any Security subject to a Conditional Redemption is
not an Event of Default if any event on which such redemption is so conditioned
does not occur and is not waived before the scheduled redemption date.
SECTION 6.02. Acceleration.
If an Event of Default occurs and is continuing on a series, the Trustee by
notice to the Company, or the Holders of at least 33-1/3% in principal amount of
the series by notice to the Company and the Trustee, may declare the principal
of and accrued interest on all the Securities of the series to be due and
payable immediately. Discounted Debt Securities may provide that the amount of
principal due upon acceleration is less than the stated principal amount.
The Holders of a majority in principal amount of the series by 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 on the series have been cured or waived except nonpayment 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 on a series, the Trustee
may pursue any available remedy to collect
<PAGE>
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principal or interest then due on the series, to enforce the performance of any
provision applicable to the series, or otherwise to protect the rights of the
Trustee and Holders of the series.
The Trustee may maintain a proceeding even if it does not possess any of
the Securities or coupons or does not produce any of them in the proceeding. A
delay or omission 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 acquiescence in the Event of Default. All remedies
are cumulative to the extent permitted by law.
SECTION 6.04. Waiver of Past Defaults.
Unless the Securities Resolution otherwise provides, the Holders of a
majority in principal amount of a series by notice to the Trustee may waive an
existing Default on the series and its consequences except:
(1) a Default in the payment of the principal of or interest on the
series, or
(2) a Default in respect of a provision that under Section 9.02 cannot be
amended without the consent of each Securityholder affected.
SECTION 6.05. Control by Majority.
The Holders of a majority in principal amount of a series may direct the
time, method and place of conducting any proceeding for any remedy available to
the Trustee, or of exercising any trust or power conferred on the Trustee, with
respect to the series. However, the Trustee may refuse to follow any direction
that conflicts with law or this Indenture, is unduly prejudicial to the rights
of other Securityholders or if the Trustee shall determine that the action or
direction might involve the Trustee in personal liability.
SECTION 6.06. Limitation on Suits.
A Securityholder of a series may pursue a remedy with respect to the series
only if:
(1) the Holder gives to the Trustee notice of a continuing Event of
Default on the series;
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(2) the Holders of at least 33-1/3% in principal amount of the series make
a request to the Trustee to pursue the remedy;
(3) such Holder or Holders offer to the Trustee indemnity 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 request and the offer of indemnity; and
(5) during such 60-day period the Holders of a majority in principal
amount of the series do not give the Trustee a direction inconsistent
with such request.
A Securityholder may not use this Indenture to prejudice the rights of
another Securityholder or to obtain a preference or priority over another
Securityholder.
SECTION 6.07. Collection Suit by Trustee.
If an Event of Default in payment of interest, principal or sinking fund
specified in Section 6.01(1), (2) or (3) occurs and is continuing on a series,
the Trustee may recover judgment in its own name and as trustee of an express
trust against the Company for the whole amount of principal and interest
remaining unpaid on the series.
SECTION 6.08. Priorities.
If the Trustee collects any money for a series pursuant to this Article, it
shall pay out the money in the following order:
First: to the Trustee for amounts due under Section 7.06;
Second: to Securityholders of the series for amounts due and unpaid
for principal and interest, ratably, without preference or priority of any
kind, according to the amounts due and payable for principal and interest,
respectively; and
Third: to the Company.
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The Trustee may fix a payment date for any payment to Securityholders.
ARTICLE 7 -- TRUSTEE
SECTION 7.01. Rights of Trustee.
(1) The Trustee may rely on any document believed by it to be genuine and
to have been signed or presented by the proper person. The Trustee
need not investigate any fact or matter stated in the document.
(2) Before the Trustee acts or refrains from acting, it may require an
Officers' Certificate or an Opinion of Counsel. The Trustee shall not
be liable for any action it takes or omits to take in good faith in
reliance on the Certificate or Opinion.
(3) The Trustee may act through agents, attorneys, custodians and nominees
and shall not be responsible for the misconduct or negligence of any
agent, attorney, custodian or nominee appointed with due care.
(4) The Trustee shall not be liable for any action it takes or omits to
take in good faith in accordance with a direction received by it
pursuant to Section 6.05.
(5) The Trustee may refuse to perform any duty or exercise any right or
power which it reasonably believes may expose it to any loss,
liability or expense unless it receives indemnity satisfactory to it
against such loss, liability or expense.
(6) The Trustee shall not be liable for interest on any money received by
it except as the Trustee may agree with the Company. Money held in
trust by the Trustee need not be segregated from other funds except to
the extent required by law.
(7) The Trustee shall have no duty with respect to a Default unless it has
actual knowledge of the
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Default. As used herein, the term "actual knowledge" means the actual
fact or statement of knowing, without any duty to make any
investigation with regard thereto.
(8) The Trustee shall not be liable for any action it takes or omits to
take in good faith which it believes to be authorized and within its
powers.
(9) Any Agent shall have the same rights and be protected to the same
extent as if it were Trustee.
(10) The Trustee shall not be required to give any bond or surety in
respect of the performance of its powers and duties hereunder.
SECTION 7.02. Individual Rights of Trustee.
The Trustee in its individual or any other capacity may become the owner or
pledgee of Securities or coupons and may otherwise deal with the Company or an
Affiliate with the same rights it would have if it were not Trustee. Any Agent
may do the same with like rights.
SECTION 7.03. Trustee's Disclaimer.
The Trustee makes no representation as to the validity or adequacy of this
Indenture or the Securities or any coupons; it shall not be accountable for the
Company's use of the proceeds from the Securities; it shall not be responsible
for any statement in the Securities or any coupons other than its
authentication.
SECTION 7.04. Notice of Defaults.
If a Default occurs and is continuing on a series and if the Trustee has
actual knowledge of such Default, the Trustee shall mail a notice of the Default
within 90 days after it occurs to Holders of Registered Securities of the
series. Except in the case of a Default in payment on a series, the Trustee may
withhold the notice if and so long as a committee of its Trust Officers in good
faith determines that withholding the notice is in the interest of Holders of
the series. The Trustee shall withhold notice of a Default described in Section
6.01(4) until at least 90 days after it occurs.
<PAGE>
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SECTION 7.05. Reports by Trustee to Holders.
Any report required by TIAss. 313(a) to be mailed to Securityholders shall
be mailed by the Trustee on or before July 15 of each year.
A copy of each report at the time of its mailing to Securityholders shall
be filed with the SEC and each stock exchange on which any Securities are
listed. The Company shall notify the Trustee when any Securities are listed on a
stock exchange.
SECTION 7.06. Compensation and Indemnity.
The Company shall pay to the Trustee from time to time reasonable
compensation for its services. The Trustee's compensation shall not be limited
by any law on compensation of a trustee of an express trust. The Company shall
reimburse the Trustee upon request for all reasonable out-of-pocket expenses
incurred by it. Such expenses shall include the reasonable compensation and
expenses of the Trustee's agents and counsel.
The Company shall indemnify the Trustee against any loss or liability
incurred by it. The Trustee shall notify the Company promptly of any claim for
which it may seek indemnity. The Company shall defend the claim and the Trustee
shall cooperate in the defense. The Trustee may have separate counsel and the
Company shall pay the reasonable fees and expenses of such counsel. The Company
need not pay for any settlement made without its consent.
The Company need not reimburse any expense or indemnify against any loss or
liability incurred by the Trustee through negligence or willful misconduct.
To secure the Company's payment obligations in this Section, the Trustee
shall have a lien prior to the Securities and any coupons on all money or
property held or collected by the Trustee, except that held in trust to pay
principal or interest on particular securities.
When the Trustee incurs expenses or renders services after an Event of
Default specified in Section 6.01(5) or (6) occurs, such expenses and the
compensation for such services are intended to constitute expenses of
administration under any Bankruptcy Law.
<PAGE>
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The provisions of this Section shall survive any termination or discharge
of this Indenture (including without limitation any termination under any
Bankruptcy Law) and the resignation or removal of the Trustee.
SECTION 7.07. Replacement of Trustee.
A resignation or removal of the Trustee and appointment of a successor
Trustee shall become effective only upon the successor Trustee's acceptance of
appointment as provided in this Section.
The Trustee may resign by so notifying the Company. The Holders of a
majority in principal amount of the Securities may remove the Trustee by so
notifying the Trustee and may appoint a successor Trustee with the Company's
consent.
The Company may remove the Trustee if:
(1) the Trustee fails to comply with TIAss.310(a) orss.310(b) or with
Section 7.09;
(2) the Trustee is adjudged a bankrupt or an insolvent;
(3) a Custodian or other public officer takes charge of the Trustee or its
property;
(4) the Trustee becomes incapable of acting; or
(5) an event of the kind described in Section 6.01(5) or (6) occurs with
respect to the Trustee.
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 a 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 principal amount of the Securities may petition any
court of competent jurisdiction for the appointment of a successor Trustee.
If the Trustee fails to comply with TIA ss. 310(a) or ss. 310(b) or with
Section 7.09, any Securityholder may petition
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any court of competent jurisdiction for the removal of the Trustee and the
appointment of a 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 shall
have all the rights, powers and duties of the Trustee under this Indenture. The
successor Trustee shall mail a notice of its succession to Holders of Registered
Securities. The retiring Trustee shall promptly transfer all property held by it
as Trustee to the successor Trustee, subject to the lien provided for in Section
7.06.
SECTION 7.08. Successor Trustee by Merger, etc.
If the Trustee consolidates, merges or converts into, or transfers all or
substantially all of its corporate trust business to, another corporation, the
successor corporation without any further act shall be the successor Trustee.
SECTION 7.09. Trustee's Capital and Surplus.
The Trustee, or the bank holding company of which the Trustee is a wholly
owned Subsidiary, at all times shall have a combined capital and surplus of at
least $50,000,000 as set forth in its most recent published report of financial
condition.
ARTICLE 8 -- DISCHARGE OF INDENTURE
SECTION 8.01. Defeasance.
Securities of a series may be defeased in accordance with their terms and,
unless the Securities Resolution otherwise provides, in accordance with this
Article.
The Company at any time may terminate as to a series all of its obligations
under this Indenture, the Securities of the series and any related coupons
("legal defeasance option"). The Company at any time may terminate as to a
series its obligations, if any, under any restrictive covenants which may be
applicable to a particular series ("covenant defeasance option"). However, in
the case of the legal defeasance option, the Company's obligations in Sections
2.03, 2.04, 2.05, 2.06, 2.07, 2.08, 7.06, 7.07 and 8.04 shall survive until the
Securi-
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ties of the series are no longer outstanding; thereafter the Company's
obligations in Section 7.06 shall survive.
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, a series may not be accelerated because of an Event of
Default. If the Company exercises its covenant defeasance option, a series may
not be accelerated by reference to any restrictive covenants which may be
applicable to such series.
The Trustee upon request shall acknowledge in writing the discharge of
those obligations or restrictions that the Company terminates by defeasance.
SECTION 8.02. Conditions to Defeasance.
The Company may exercise as to a series its legal defeasance option or its
covenant defeasance option if:
(1) the Company irrevocably deposits in trust with the Trustee or another
trustee money or U.S. Government Obligations;
(2) the Company delivers to the Trustee a certificate from a nationally
recognized firm of independent accountants expressing their opinion
that the payments of principal and interest when due on the deposited
U.S. Government Obligations without reinvestment plus any deposited
money without investment will provide cash at such times and in such
amounts as will be sufficient to pay principal and interest when due
on all the Securities of the series to maturity or redemption, as the
case may be;
(3) immediately after the deposit no Default exists;
(4) the deposit does not constitute a default under any other agreement
binding on the Company;
(5) the deposit does not cause the Trustee to have a conflicting interest
under TIAss. 310(a) orss. 310(b) as to another series;
(6) the Company delivers to the Trustee an Opinion of Counsel to the
effect that Holders of the series will not recognize income, gain or
loss for
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Federal income tax purposes as a result of the defeasance; and
(7) 91 days pass after the deposit is made and during the 91-day period no
Default specified in Section 6.01(5) or (6) occurs that is continuing
at the end of the period.
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 3.
"U.S. Government Obligations" means direct obligations of (i) the United
States or (ii) an agency or instrumentality of the United States, the payment of
which is unconditionally guaranteed by the United States, which, in either case,
have the full faith and credit of the United States pledged for payment and
which are not callable at the issuer's option, or certificates representing an
ownership interest in such obligations.
SECTION 8.03. Application of Trust Money.
The Trustee shall hold in trust money or U.S. Government Obligations
deposited with it pursuant to Section 8.02. 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 principal and interest on
Securities of the defeased series.
SECTION 8.04. Repayment to Company.
The Trustee and the Paying Agent shall promptly turn over to the Company
upon request any excess money or securities held by them at any time.
The Trustee and the Paying Agent shall pay to the Company upon written
request any money held by them for the payment of principal or interest that
remains unclaimed for two years. After payment to the Company, Securityholders
entitled to the money must look to the Company for payment as unsecured general
creditors unless an abandoned property law designates another person.
<PAGE>
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ARTICLE 9 -- AMENDMENTS
SECTION 9.01. Without Consent of Holders.
The Company and the Trustee may amend this Indenture, the Securities or any
coupons without the consent of any Securityholder:
(1) to cure any ambiguity, omission, defect or inconsistency;
(2) to comply with Section 5.01(2).
(3) to provide that specific provisions of this Indenture shall not apply
to a series not previously issued;
(4) to create a series and establish its terms;
(5) to provide for a separate Trustee for one or more series; or
(6) to make any change that does not materially adversely affect the
rights of any Securityholder.
SECTION 9.02. With Consent of Holders.
Unless the Securities Resolution otherwise provides, the Company and the
Trustee may amend this Indenture, the Securities and any coupons with the
written consent of the Holders of a majority in principal amount of the
Securities of all series affected by the amendment voting as one class. However,
without the consent of each Securityholder affected, an amendment under this
Section may not:
(1) reduce the amount of Securities whose Holders must consent to an
amendment;
(2) reduce the interest on or change the time for payment of interest on
any Security;
(3) change the fixed maturity of any Security;
(4) reduce the principal of any non-Discounted Debt Security or reduce the
amount of principal of any Discounted Debt Security that would be due
upon an acceleration thereof;
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(5) change the currency in which principal or interest on a Security is
payable;
(6) make any change that materially adversely affects the right to convert
any Security; or
(7) make any change in Section 6.04 or 9.02, except to increase the amount
of Securities whose Holders must consent to an amendment or waiver or
to provide that other provisions of this Indenture cannot be amended
or waived without the consent of each Securityholder affected thereby.
An amendment of a provision included solely for the benefit of one or more
series does not affect Securityholders of any other series.
Securityholders need not consent to the exact text of a proposed amendment
or waiver; it is sufficient if they consent to the substance thereof.
SECTION 9.03. Compliance with Trust Indenture Act.
Every amendment pursuant to Section 9.01 or 9.02 shall be set forth in a
supplemental indenture (except any amendment pursuant to Section 9.01(4), which
may be set forth in a Securities Resolution) that complies with the TIA.
If a provision of the TIA requires or permits a provision of this Indenture
and the TIA provision is amended, then the Indenture provision shall be
automatically amended to like effect.
SECTION 9.04. Effect of Consents.
An amendment or waiver becomes effective in accordance with its terms and
thereafter binds every Securityholder entitled to consent to it.
A consent to an amendment or waiver by a Holder of a Security is a
continuing consent by the Holder and every subsequent Holder of a Security that
evidences the same debt as the consenting Holder's Security. Any Holder or
subsequent Holder may revoke the consent as to his Security if the Trustee
receives notice of the revocation before the amendment or waiver becomes
effective.
<PAGE>
-32-
The Company may fix a record date for the determination of Holders of
Registered Securities entitled to give a consent. The record date shall not be
less than 10 nor more than 60 days prior to the first written solicitation of
Securityholders.
SECTION 9.05. Notation on or Exchange of Securities.
The Company or the Trustee may place an appropriate notation about an
amendment or waiver on any Security thereafter authenticated. The Company may
issue in exchange for affected Securities and the Trustee shall authenticate new
Securities that reflect the amendment or waiver.
SECTION 9.06. Trustee Protected.
The Trustee need not sign any supplemental indenture that adversely affects
its rights. The Trustee shall be entitled to receive, and shall be fully
protected in relying upon, an Opinion of Counsel and an Officers' Certificate
each stating that the execution of any amendment or supplement or waiver
authorized pursuant to this Article is authorized or permitted by this
Indenture, and that such amendment or supplement or waiver constitutes the
legal, valid and binding obligation of the Company.
ARTICLE 10 -- MISCELLANEOUS
SECTION 10.01. Trust Indenture Act.
The provisions of TIA ss.ss. 310 through 317 that impose duties on any
person (including the provisions automatically deemed included herein unless
expressly excluded by this Indenture) are a part of and govern this Indenture,
whether or not expressly set forth herein.
If any provision of this Indenture limits, qualifies or conflicts with
another provision which is required to be included in this Indenture by the TIA,
the required provision shall control. If any provision of this Indenture
modifies or excludes any provision of the TIA that may be so modified or
excluded, the latter provision shall be deemed to apply to this Indenture as so
modified or excluded, as the case may be.
<PAGE>
-33-
SECTION 10.02. Notices.
Any notice by one party to another is duly given if in writing and
delivered in person, sent by facsimile transmission confirmed by mail or mailed
by first-class mail to the other's address shown below:
Company:
Sequa Corporation
200 Park Avenue
New York, New York 10166
Fax: (212) 370-1969
Attention: Treasurer
Trustee:
Bank of Montreal Trust Company
Wall Street Plaza
88 Pine Street
New York, New York 10005
Fax: (212) 701-7698
Attention: Corporate Trust Department
A party by notice to the other parties may designate additional or
different addresses for subsequent notices.
Any notice mailed to a Securityholder shall be mailed to his address shown
on the register kept by the Registrar or on the list referred to in Section
2.06. Failure to mail a notice to a Securityholder or any defect in a notice
mailed to a Securityholder shall not affect the sufficiency of the notice mailed
to other Securityholders or the sufficiency of any published notice.
If a notice is mailed in the manner provided above within the time
prescribed, it is duly given, whether or not the addressee receives it.
If the Company mails a notice to Securityholders, it shall mail a copy to
the Trustee and each Agent at the same time.
If in the Company's opinion it is impractical to mail a notice required to
be mailed or to publish a notice required to be published, the Company may give
such substitute notice as the Trustee approves. Failure to publish a notice as
required
<PAGE>
-34-
or any defect in it shall not affect the sufficiency of any mailed notice.
All notices shall be in the English language, except that any published
notice may be in an official language of the country of publication.
A "notice" includes any communication required by this Indenture.
SECTION 10.03. Certificate and Opinion as to Conditions
Precedent.
Upon any request or application by the Company to the Trustee to take any
action under this Indenture, the Company shall if so requested furnish to the
Trustee:
(1) an Officers' Certificate stating that, in the opinion of the signers,
all conditions precedent, if any, provided for in this Indenture
relating to the proposed action have been complied with; and
(2) an Opinion of Counsel stating that, in the opinion of such counsel,
all such conditions precedent have been complied with.
SECTION 10.04. Statements Required in Certificate or Opinion.
Each certificate or opinion with respect to compliance with a condition or
covenant provided for in this Indenture shall include:
(1) a statement that the person making such certificate or opinion 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
certificate or opinion are based;
(3) a statement that, in the opinion of such person, he has made such
examination or investigation as is necessary to enable him to express
an informed opinion as to whether or not such covenant or condition
has been complied with; and
<PAGE>
-35-
(4) a statement as to whether or not, in the opinion of such person, such
condition or covenant has been complied with.
SECTION 10.05. Rules by Company and Agents.
The Company may make reasonable rules for action by or a meeting of
Securityholders. An Agent may make reasonable rules and set reasonable
requirements for its functions.
SECTION 10.06. No Lien Created, etc.
Except as provided in Section 7.06, this Indenture and the Securities do
not create a Lien, charge or encumbrance on any property of the Company or any
Subsidiary.
SECTION 10.07. Legal Holidays.
A "Legal Holiday" is a Saturday, a Sunday or a day on which banking
institutions are not required to be open. If a payment date is a Legal Holiday
at a place of payment, unless the Securities Resolution establishing a series
otherwise provides with respect to Securities of the series, payment may be made
at that place on the next succeeding day that is not a Legal Holiday, and no
interest shall accrue for the intervening period.
SECTION 10.08. No Recourse Against Others.
All liability described in the Securities of any director, officer,
employee or stockholder, as such, of the Company is waived and released.
SECTION 10.09. Duplicate Originals.
The parties may sign any number of copies of this Indenture. One signed
copy is enough to prove this Indenture.
SECTION 10.10. Governing Law.
The laws of the State of New York shall govern this Indenture, the
Securities and any coupons, unless federal law governs.
<PAGE>
S-1
SIGNATURES
Dated: , SEQUA CORPORATION
By
----------------------------------
Name:
Title:
Dated: , [TRUSTEE]
By
---------------------------------
Name:
Title:
<PAGE>
EXHIBIT A
A Form of Registered Security
No. $
SEQUA CORPORATION
[Title of Security]
Sequa Corporation
promises to pay to
or registered assigns
the principal sum of Dollars on ,
Interest Payment Dates:
Record Dates:
Dated:
SEQUA CORPORATION
by
(SEAL)_____________________________________
Authenticated: Chairman of the Board
[Name of Trustee], as
Trustee
By
_____________________ _____________________________________
Authorized Signature Vice President
A-1
<PAGE>
SEQUA CORPORATION
[Title of Security]
[Explanatory Notes follow Exhibit B]
1. Interest.(1)
Sequa Corporation ("Company"), a corporation organized and existing
under the laws of the State of Delaware, promises to pay interest on
the principal amount of this Security at the rate per annum shown
above. The Company will pay interest on __________ and __________ of
each year commencing __________, 19__. Interest on the Securities will
accrue from the most recent date to which interest has been paid or,
if no interest has been paid, from __________, 19__. Interest will be
computed on the basis of a 360-day year of twelve 30-day months.
2. Method of Payment.(2)
The Company will pay interest on the Securities to the persons who are
registered holders of Securities at the close of business on the
record date for the next interest payment date, except as otherwise
provided in the Indenture. Holders must surrender Securities to a
Paying Agent to collect principal payments. The Company will pay
principal and interest in money of the United States that at the time
of payment is legal tender for payment of public and private debts.
The Company may pay principal and interest by check payable in such
money. It may mail an interest check to a holder's registered address.
3. Agents.
Initially, _____________________ Attention: ____________, will act as
Paying Agent and Registrar. The Company may change any Paying Agent or
Registrar without notice or provide for more than one such agent. The
Company or any Affiliate may act in any such capacity.
4. Indenture.
The Company issued the securities of this series ("Securities") under
an Indenture dated as of __________, ("Indenture") between the Company
and
A-2
<PAGE>
__________ ("Trustee"). The terms of the Securities include those
stated in the Indenture and in the Securities Resolution creating the
Securities and those made part of the Indenture by the Trust Indenture
Act of 1939 (15 U.S. Code ss.ss. 77aaa-77bbbb), as amended.
Securityholders are referred to the Indenture, the Securities
Resolution and the Act for a statement of such terms.
5. Optional Redemption.(3)
On or after __________, the Company may redeem all the Securities at
any time or some of them from time to time at the following redemption
prices (expressed in percentages of principal amount), plus accrued
interest to the redemption date.
If redeemed during the 12-month period beginning,
Year Percentage Year Percentage
and thereafter at 100%.
6. Mandatory Redemption.(4)
The Company will redeem $__________ principal amount of Securities on
_________ and on each __________ thereafter through __________ at a
redemption price of 100% of principal amount, plus accrued interest to
the redemption date.(5) The Company may reduce the principal amount of
Securities to be redeemed pursuant to this paragraph by subtracting
100% of the principal amount (excluding premium) of any Securities (i)
that the Company has acquired or that the Company has redeemed other
than pursuant to this paragraph and (ii) that the Company has
delivered to the Registrar for cancellation. The Company may so
subtract the same Security only once.
7. Additional Optional Redemption.(6)
In addition to redemptions pursuant to the above paragraph(s), the
Company may redeem not more than $__________ principal amount of
Securities on __________ and on each __________ thereafter through at
a redemption price of 100% of
A-3
<PAGE>
principal amount, plus accrued interest to the redemption date.
8. Notice of Redemption.(7)
Notice of redemption will be mailed at least 30 days before the
redemption date to each holder of Securities to be redeemed at his
registered address.
A notice of redemption may provide that it is subject to the
occurrence of any event before the date fixed for such redemption as
described in such notice ("Conditional Redemption") and such notice of
Conditional Redemption shall be of no effect unless all such
conditions to the redemption have occurred before such date or have
been waived by the Company.
9. Denominations, Transfer, Exchange.
The Securities are in registered form without coupons in denominations
of $1,000(8) and whole multiples of $1,000. The transfer of Securities
may be registered and Securities may be exchanged as provided in the
Indenture. The Trustee 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 the Indenture. The Trustee need not
exchange or register the transfer of any Security or portion of a
Security selected for redemption. Also, it need not exchange or
register the transfer of any Securities for a period of 15 days before
a selection of Securities to be redeemed.
10. Persons Deemed Owners.
The registered holder of a Security may be treated as its owner for
all purposes.
11. Amendments and Waivers.
Subject to certain exceptions, the Indenture or the Securities may be
amended with the consent of the holders of a majority in principal
amount of the securities of all series affected by the amendment.9
Subject to certain exceptions, a default on a series may be waived
with the consent of the holders of a majority in principal amount of
the series.
A-4
<PAGE>
Without the consent of any Securityholder, the Indenture or the
Securities may be amended, among other things, to cure any ambiguity,
omission, defect or inconsistency; to provide for assumption of
Company obligations to Securityholders; or to make any change that
does not materially adversely affect the rights of any Securityholder.
12. Restrictive Covenants.(10)
The Securities are unsecured general obligations of the Company
limited to $__________ principal amount. The Indenture does not limit
other unsecured debt.
13. Successors.
When a successor assumes all the obligations of the Company under the
Securities and the Indenture, the Company will be released from those
obligations.
14. Defeasance Prior to Redemption or Maturity.(11)
Subject to certain conditions, the Company at any time may terminate
some or all of its obligations under the Securities and the Indenture
if the Company deposits with the Trustee money or U.S. Government
Obligations for the payment of principal and interest on the
Securities to redemption or maturity. U.S. Government Obligations are
securities backed by the full faith and credit of the United States of
America or certificates representing an ownership interest in such
Obligations.
15. Defaults and Remedies.
An Event of Default(12) includes: default for 60 days in payment of
interest on the Securities; default in payment of principal on the
Securities; default for 60 days in payment or satisfaction of any
sinking fund obligation; default by the Company for a specified period
after notice to it in the performance of any of its other agreements
applicable to the Securities; certain events of bankruptcy or
insolvency; and any other Event of Default provided for in the series.
If an Event of Default occurs and is continuing, the Trustee or the
holders of at least 33-1/3% in principal amount of the Securities may
declare the
A-5
<PAGE>
principal(13) of all the Securities to be due and payable immediately.
Securityholders may not enforce the Indenture or the Securities except
as provided in the Indenture. The Trustee may require indemnity
satisfactory to it before it enforces the Indenture or the Securities.
Subject to certain limitations, holders of a majority in principal
amount of the Securities 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 principal or
interest) if it determines that withholding notice is in their
interests. The Company must furnish an annual compliance certificate
to the Trustee.
16. Trustee Dealings with Company.
___________________, the Trustee under the Indenture, in its
individual or any other capacity, may make loans to, accept deposits
from, and perform services for the Company or its Affiliates, and may
otherwise deal with the Company or its Affiliates, as if it were not
Trustee.
17. 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. Each
Securityholder by accepting a Security waives and releases all such
liability. The waiver and release are part of the consideration for
the issue of the Securities.
18. Authentication.
This Security shall not be valid until authenticated by a manual
signature of the Registrar.
19. 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
survi-
A-6
<PAGE>
vorship and not as tenants in common), CUST (= custodian), and U/G/M/A
(= Uniform Gifts to Minors Act).
The Company will furnish to any Securityholder upon written request and
without charge a copy of the Indenture and the Securities Resolution which
contains the text of this Security in larger type. Requests may be made to:
Sequa Corporation, 200 Park Avenue, New York, New York 10166, Attention:
Treasurer.
A-7
<PAGE>
EXHIBIT B
A Form of Bearer Security
No. $
SEQUA CORPORATION
[Title of Security]
[Explanatory Notes follow ]
Sequa Corporation
promises to pay to bearer
the principal sum of Dollars on ,
Interest Payment Dates:
Dated:
SEQUA CORPORATION
(SEAL) by
Authenticated: ________________________
Chairman of the Board
[Name of Trustee], as
Trustee
By
- --------------------- ------------------------
Authorized Signature Vice President
B-1
<PAGE>
SEQUA CORPORATION
[Title of Security]
1. Interest.(1)
Sequa Corporation ("Company"), a corporation organized and existing
under the laws of the State of Delaware, promises to pay to bearer
interest on the principal amount of this Security at the rate per
annum shown above. The Company will pay interest on ___________ and
__________ of each year commencing , 19__. Interest on the Securities
will accrue from the most recent date to which interest has been paid
or, if no interest has been paid, from __________, 19__. Interest will
be computed on the basis of a 360-day year of twelve 30-day months.
2. Method of Payment.(2)
Holders must surrender Securities and any coupons to a Paying Agent to
collect principal and interest payments. The Company will pay
principal and interest in money of the United States that at the time
of payment is legal tender for payment of public and private debts.
The Company may pay principal and interest by check payable in such
money.
3. Agents.
Initially, ______________, Attention: _______________, will act as
Paying Agent and Registrar. The Company may change any Paying Agent or
Registrar without notice or provide for more than one such agent. The
Company or any Affiliate may act in any such capacity.
4. Indenture.
The Company issued the securities of this series ("Securities") under
an Indenture dated as of ___________, ("Indenture") between the
Company and ___________ ("Trustee"). The terms of the Securities
include those stated in the Indenture and the Securities Resolution
and those made part of the Indenture by the Trust Indenture Act of
1939 (15 U.S. Code ss.ss. 77aaa-77bbbb), as amended. Securityholders
B-2
<PAGE>
are referred to the Indenture, the Securities Resolution and the Act
for a statement of such terms.
5. Optional Redemption.(3)
On or after ___________, the Company may redeem all the Securities at
any time or some of them from time to time at the following redemption
prices (expressed in percentages of principal amount), plus accrued
interest to the redemption date.
If redeemed during the 12-month period beginning,
Year Percentage Year Percentage
and thereafter 100%.
6. Mandatory Redemption.(4)
The Company will redeem $__________ principal amount of Securities on
__________ and on each __________ thereafter through __________ at a
redemption price of 100% of principal amount, plus accrued interest to
the redemption date.(5) The Company may reduce the principal amount of
Securities to be redeemed pursuant to this paragraph by subtracting
100% of the principal amount (excluding premium) of any Securities (i)
that the Company has acquired or that the Company has redeemed other
than pursuant to this paragraph and (ii) that the Company has
delivered to the Registrar for cancellation. The Company may so
subtract the same Security only once.
7. Additional Optional Redemption.(6)
In addition to redemptions pursuant to the above paragraph(s), the
Company may redeem not more than $_________ principal amount of
Securities on __________ and on each _________ thereafter through at a
redemption price of 100% of principal amount, plus accrued interest to
the redemption date.
8. Notice of Redemption.(7)
Notice of redemption will be published once in an Authorized Newspaper
in the City of New York and if the Securities are listed on any stock
exchange lo-
B-3
<PAGE>
cated outside the United States and such stock exchange so requires,
in any other required city outside the United States at least 30 days
before the redemption date. Notice of redemption also will be mailed
to holders who have filed their names and addresses with the Transfer
Agent within the two preceding years. A holder of Securities may miss
important notices if he fails to maintain his name and address with
the Transfer Agent.
A notice of redemption may provide that it is subject to the
occurrence of any event before the date fixed for such redemption as
described in such notice ("Conditional Redemption") and such notice of
Conditional Redemption shall be of no effect unless all such
conditions to the redemption have occurred before such date or have
been waived by the Company.
9. Denominations, Transfer, Exchange.
The Securities are in bearer form with coupons in denominations of
$5,000(8) and whole multiples of $5,000. The Securities may be
transferred by delivery and exchanged as provided in the Indenture.
Upon an exchange, the Trustee may require a holder, among other
things, to furnish appropriate documents and to pay any taxes and fees
required by law or the Indenture. The Trustee need not exchange any
Security or portion of a Security selected for redemption. Also, it
need not exchange any Securities for a period of 15 days before a
selection of Securities to be redeemed.
10. Persons Deemed Owners.
The holder of a Security or coupon may be treated as its owner for all
purposes.
11. Amendments and Waivers.
Subject to certain exceptions, the Indenture or the Securities may be
amended with the consent of the holders of a majority in principal
amount of the securities of all series affected by the amendment.(9)
Subject to certain exceptions, a default on a series may be waived
with the consent of the holders of a majority in principal amount of
the series.
B-4
<PAGE>
Without the consent of any Securityholder, the Indenture or the
Securities may be amended, among other things, to cure any ambiguity,
omission, defect or inconsistency; to provide for assumption of
Company obligations to Securityholders; or to make any change that
does not materially adversely affect the rights of any Securityholder.
12. Restrictive Covenants.(10)
The Securities are unsecured general obligations of the Company
limited to $_________ principal amount. The Indenture does not limit
other unsecured debt.
13. Successors.
When a successor assumes all the obligations of the Company under the
Securities, any coupons and the Indenture, the Company will be
released from those obligations.
14. Defeasance Prior to Redemption or Maturity.(11)
Subject to certain conditions, the Company at any time may terminate
some or all of its obligations under the Securities, any coupons and
the Indenture if the Company deposits with the Trustee money or U.S.
Government Obligations for the payment of principal and interest on
the Securities to redemption or maturity. U.S. Government Obligations
are securities backed by the full faith and credit of the United
States of America or certificates representing an ownership interest
in such Obligations.
15. Defaults and Remedies.
An Event of Default(12) includes: default for 60 days in payment of
interest on the Securities; default in payment of principal on the
Securities; default for 60 days in payment or satisfaction of any
sinking fund obligation; default by the Company for a specified period
after notice to it in the performance of any of its other agreements
applicable to the Securities; certain events of bankruptcy or
insolvency; and any other Event of Default provided for in the series.
If an Event of Default occurs and is continuing, the Trustee or the
holders of at least 33-1/3%
B-5
<PAGE>
in principal amount of the Securities may declare the principal(13) of
all the Securities to be due and payable immediately.
Securityholders may not enforce the Indenture or the Securities except
as provided in the Indenture. The Trustee may require indemnity
satisfactory to it before it enforces the Indenture or the Securities.
Subject to certain limitations, holders of a majority in principal
amount of the Securities 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 principal or
interest) if it determines that withholding notice is in their
interests. The Company must furnish annual compliance certificates to
the Trustee.
16. Trustee Dealings with Company.
__________, the Trustee under the Indenture, in its individual or any
other capacity, may make loans to, accept deposits from, and perform
services for the Company or its Affiliates, and may otherwise deal
with the Company or its Affiliates, as if it were not Trustee.
17. 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. Each
Securityholder by accepting a Security waives and releases all such
liability. The waiver and release are part of the consideration for
the issue of the Securities.
18. Authentication.
This Security shall not be valid until authenticated by a manual
signature of the Registrar.
B-6
<PAGE>
19. 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 Gifts to Minors Act).
The Company will furnish to any Securityholder upon written request and
without charge a copy of the Indenture and the Securities Resolution which
contains the text of this Security in larger type. Requests may be made to:
Sequa Corporation, 200 Park Avenue, New York, New York 10166, Attention:
Treasurer.
B-7
<PAGE>
[FACE OF COUPON]
...............
[$]............
Due............
SEQUA CORPORATION
[Title of Security]
Unless the Security attached to this coupon has been called for redemption,
Sequa Corporation (the "Company") will pay to bearer, upon surrender, the amount
shown hereon when due. This coupon may be surrendered for payment to any Paying
Agent listed on the back of this coupon unless the Company has replaced such
Agent. Payment may be made by check. This coupon represents months' interest.
SEQUA CORPORATION
By ______________________________
[REVERSE OF COUPON]
PAYING AGENTS
B-8
<PAGE>
NOTES TO EXHIBITS A AND B
1 If the Security is not to bear interest at a fixed rate per annum, insert a
description of the manner in which the rate of interest is to be
determined. If the Security is not to bear interest prior to maturity, so
state.
2 If the method or currency of payment is different, insert a statement
thereof.
3 If applicable. A restriction on redemption or refunding or any provision
applicable to its redemption other may be added.
4 Such provisions as are applicable, if any.
5 If the Security is a Discounted Debt Security, insert amount to be redeemed
or method of calculating such amount.
6 If applicable. Also insert, if applicable, provisions for repayment of
Securities at the option of the Securityholder.
7 If applicable.
8 If applicable. Insert additional or different denominations and terms as
appropriate.
9 If different terms apply, insert a brief summary thereof.
10 If applicable. If additional or different covenants apply, insert a brief
summary thereof.
11 If applicable. If different defeasance terms apply, insert a brief summary
thereof.
12 If additional or different Events of Default apply, insert a brief summary
thereof.
13 If the Security is a Discounted Debt Security, set forth the amount due and
payable upon an Event of Default.
Note: U.S. tax law may require certain legends on Discounted Debt and Bearer
Securities.
1
<PAGE>
EXHIBIT C
ASSIGNMENT FORM
To assign this Security, fill in the form below:
I or we assign and transfer this Security to
-----------------------------------------
: :
:---------------------------------------:
(Insert assignee's soc. sec. or tax I.D. no.)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(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.
Date: _______________ Your Signature: _____________________________
_____________________________
(Sign exactly as your name appears on the other side of this Security)
C-1
SECURITIES RESOLUTION NO.
OF
SEQUA CORPORATION
I, , Secretary of Sequa Corporation (the "Company"), do hereby certify that
the attached is a true and correct copy of Securities Resolution No. duly
adopted by the of the Company pursuant to authorization delegated to him by the
Committee of the Board of Directors of the Company at a meeting called and held
on the day of ; that a quorum of said Board Committee was present at said
meeting and voted throughout; and I do further certify that said resolution has
not been rescinded and remains in full force and effect.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the corporate
seal of SEQUA CORPORATION this day of .
By:_____________________________
Name:
Title:
[CORPORATE SEAL]
<PAGE>
[ ]% SENIOR NOTES DUE [ ]
SECURITIES RESOLUTION NO.[ ]
OF
SEQUA CORPORATION
The actions described below are taken by the Board of Directors (the
"Board") of SEQUA CORPORATION (the "Company"), or by an Officer or committee of
Officers pursuant to Board delegation, in accordance with resolutions adopted by
the Board as of [ ], resolutions adopted by the Committee of the Board as of [
], and Section 2.02 of the Indenture dated as of [ ] (the "Indenture") between
the Company and Bank of Montreal Trust Company, Trustee. Terms used herein and
not defined have the same meaning given such terms in the Indenture.
RESOLVED, that a new series of Debt Securities is authorized as follows:
1. The title of the series is [ ]% Senior Notes due [ ] ("Senior Notes").
2. The form of the Senior Notes shall be substantially in the form of
Exhibit 1 hereto.
3. The Senior Notes shall have the terms set forth in Exhibit 1.
4. The Senior Notes shall be sold to the underwriter(s) named in the
Prospectus Supplement dated [ ] on the following terms:
Price to Public:
Underwriting Discount:
Closing Date:
This Securities Resolution shall be effective as of [ ].
E-2
Exhibit 5
October 23, 1998
Sequa Corporation
200 Park Avenue
New York, New York 10166
Dear Ladies and Gentlemen:
We have acted as special counsel to Sequa Corporation, a Delaware
corporation (the "Company"), in connection with the filing of a Registration
Statement on Form S-3 under the Securities Act of 1933, as amended (the
"Registration Statement"), relating to the Company's proposed issue and sale,
from time to time, of $500,000,000 aggregate principal amount of Debt Securities
(the "Debt Securities"), to which Registration Statement this opinion shall be
filed as an exhibit (capitalized terms used herein without definition have the
meanings given such terms in the Registration Statement).
We have examined (i) the Restated Certificate of Incorporation, two
Certificates of Amendment of the Restated Certificate of Incorporation and the
Restated and Amended Bylaws of the Company, (ii) the originals, or copies
certified or otherwise identified, of corporate records of the Company,
including minute books of the Company, resolutions, certificates of public
officials and of representatives of the Company, (iii) the Registration
Statement and schedules and exhibits thereto and (iv) such other documents and
instruments that we have deemed necessary for the opinions hereinafter
expressed.
Based upon the foregoing, we advise you that, in our opinion:
1. The Company is a corporation duly organized and validly existing under
the laws of the State of Delaware.
2. The Debt Securities are to be issued under an Indenture (hereinafter
called the "Indenture") which may hereafter be supplemented by one or more
supplemental indentures or Securities Resolutions (as defined in the Indenture)
creating the Debt Securities (forms of which are filed as exhibits to the
Registration Statement).
3. Upon (a) the Registration Statement becoming effective under the
Securities Act of 1933, (b) the authorization by the Company of a supplement to
the Indenture and/or the issuance, sale and delivery of the Debt Securities
pursuant to a Securities Resolution, (c) authorization by resolutions of the
Board of Directors of the Company, or the proper officers of the Company duly
authorized, and receipt by the Company of sufficient consideration for the
issuance, sale and delivery of such Debt Securities, and (d) the execution of
the Debt Securities by the proper officers of the Company and the authentication
thereof by the Trustee, the Debt Securities will be duly authorized and issued
and will constitute the legal, valid and binding obligations of the Company
entitled to the benefits provided by the Indenture and any supplements thereto
except that enforceability of the Debt Securities may be limited by bankruptcy,
insolvency, reorganization, fraudulent conveyance, moratorium or similar laws
affecting the enforcement of creditors' rights generally and by general
principles of equity and the discretion of the court before which any
proceedings therefor may be brought.
<PAGE>
-2-
We hereby consent to the filing of a copy of this opinion as an Exhibit to
said Registration Statement and to the reference to our firm under the caption
"Legal Matters" in the Registration Statement and related Prospectus.
Very truly yours,
CAHILL GORDON & REINDEL
Exhibit 12
<TABLE>
<CAPTION>
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
For the Five Years Ended December 31 and for
the Six Months Ended June 30, 1998
(Dollars in Thousands)
Year Ended December 31, Six Months
Ended
1993 1994 1995 1996 1997 June 30 1998
---- ---- ---- ---- ---- ------------
<S> <C> <C> <C> <C> <C> <C>
Earnings available for fixed
charges:
Pre-tax income (loss) before ($64,015) ($27,895) $27,479 $25,956 $41,827 $34,132
extraordinary item
Add (deduct)
Interest on indebtedness 66,501 59,114 53,302 51,794 50,298 25,886
Proportionate share of 11 25 1,058 1,256 1,336 164
interest on indebtedness of
fifty percent owned joint
venture
Amortization of debt expense 4,158 2,389 2,145 2,145 1,381 613
Portion of rents 8,260 5,999 5,942 6,022 5,694 2,796
representative of the interest
factor
Equity in the (income) loss of 0 2,502 3,259 1,297 (219) 1,093
less than fifty percent owned
joint ventures
Minority interest in the loss (376) (131) 0 0 0 0
of subsidiary
Minority interest in the 2,517 0 0 0 0 0
income of subsidiary with
fixed charges --------- ---------- ---------- ---------- --------- -------------
Total earnings available
for fixed charges $17,056 $42,003 $93,185 $88,470 $100,317 $64,684
========= ========== ========== ========== ========= =============
<PAGE>
2
Fixed charges:
Preference stock dividend $2,517 $0 $0 $0 $0 $0
requirements of majority-owned
subsidiary
Ratio of pre-tax income to net 1.16 1.13 3.13 2.72 2.13 2.45
income
Preference stock dividend 2,895 0 0 0 0 0
requirements of majority-owned
subsidiary on pre-tax basis
Interest on indebtedness 66,501 59,114 53,302 51,794 50,298 25,886
Proportionate share of interest 11 25 1,058 1,256 1,336 164
on indebtedness of fifty percent
owned joint venture
Amortization of debt expense 4,158 2,389 2,145 2,145 1,381 613
Portion of rents representative 8,260 5,999 5,942 6,022 5,694 2,796
of the interest factor --------- ---------- ---------- ---------- ---------- -------------
Total Fixed Charges $81,825 $67,527 $62,447 $61,217 $58,709 $29,459
========= ========== ========== ========== ========== =============
Ratio of earnings to fixed charges
(A) (A) 1.5x 1.4x 1.7x 2.2x
========= ========== ========== ========== ========== =============
- -------------------------------------
</TABLE>
(A) As a result of losses incurred in 1993 and 1994, the Company was unable to
fully cover the indicated fixed charges.
Exhibit 23(b)
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation
by reference in this Form S-3 Registration Statement and related Prospectus of
Sequa Corporation regarding the registration of $ 500 million of Debt Securities
of our reports dated February 23, 1998 incorporated by reference in Sequa
Corporation's Form 10-K for the year ended December 31, 1997, and to all
references to our Firm included in this Registration Statement and related
Prospectus.
ARTHUR ANDERSEN LLP
New York, New York
October 22, 1998
===============================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
----------------------------------------
FORM T-1
STATEMENT OF ELIGIBILITY UNDER THE TRUST INDENTURE ACT OF 1939
OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE
Check if an Application to Determine Eligibility of
a trustee Pursuant to Section 305(b) ____
BANK OF MONTREAL TRUST COMPANY
(Exact name of trustee as specified in its charter)
New York 13-4941093
(Jurisdiction of incorporation or organization (I.R.S. employer
if not a U.S. national bank) identification no.)
Wall Street Plaza, 88 Pine Street, 19th Floor
New York, New York 10005
(Address of principal executive offices) (Zip code)
Mark F. McLaughlin
Bank of Montreal Trust Company
Wall Street Plaza, 88 Pine Street, 19th Floor
New York, New York 10005
(212) 701-7602
(Name, address and telephone number of agent for service)
----------------------------------------
Sequa Corporation
(Exact name of obligor as specified in its charter)
Delaware 13-1885030
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification number)
200 Park Avenue
New York, New York 10166
(Address of principal executive offices) (Zip code)
----------------------------------------
Debt Securities
(Title of the indenture securities)
===============================================================================
<PAGE>
Item 1. General Information.
Furnish the following information as to the trustee:
(b) Name and address of each examining or supervising authority to which
it is subject.
Federal Reserve Bank of New York
33 Liberty Street, New York N.Y. 10045
State of New York Banking Department
2 Rector Street, New York, N.Y. 10006
(c) Whether it is authorized to exercise corporate trust powers.
The Trustee is authorized to exercise corporate trust powers.
Item 2. Affiliations with the Obligor.
If the obligor is an affiliate of the trustee, describe each such
affiliation.
The obligor is not an affiliate of the trustee.
Item 16. List of Exhibits.
List below all exhibits filed as part of this statement of eligibility.
1. Copy of Organization Certificate of Bank of Montreal Trust Company to
transact business and exercise corporate trust powers; incorporated
herein by reference as Exhibit "A" filed with Form T-1 Statement,
Registration No. 33-46118.
2. Copy of the existing By-Laws of Bank of Montreal Trust Company;
incorporated herein by reference as Exhibit "B" filed with Form T-1
Statement, Registration No. 33-80928.
3. The consent of the Trustee required by Section 321(b) of the Act;
incorporated herein by reference as Exhibit "C" with Form T-1
Statement, Registration No. 33-46118.
4. A copy of the latest report of condition of Bank of Montreal Trust
Company published pursuant to law or the requirements of its
supervising or examining authority, attached hereto as Exhibit "D".
-2-
<PAGE>
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939 the
Trustee, Bank of Montreal Trust Company, a corporation organized and existing
under the laws of the State of New York, has duly caused this statement of
eligibility to be signed on its behalf by the undersigned, thereunto duly
authorized, all in the City of New York, and State of New York, on the 14th day
of October, 1998
BANK OF MONTREAL TRUST COMPANY
By: /s/ Amy Roberts
----------------------------------
Amy Roberts
Vice President
-3-
<PAGE>
EXHIBIT "D"
STATEMENT OF CONDITION
BANK OF MONTREAL TRUST COMPANY
NEW YORK
ASSETS
Due From Banks $ 677,400
-----------
Investment Securities:
State & Municipal 16,513,582
Other 100
-----------
Total Securities 16,513,682
Loans and Advances:
Federal Funds Sold 20,900,000
Overdrafts 12,169
-----------
Total Loans and Advances 20,912,169
Investment in Harris Trust, NY 8,725,608
Premises and Equipment 475,614
-----------
Other Assets 2,636,845
-----------
11,838,067
-----------
TOTAL ASSETS $49,941,318
===========
LIABILITIES
Trust Deposits $8,191,549
Other Liabilities 16,944,443
-----------
TOTAL LIABILITIES 25,135,992
CAPITAL ACCOUNTS
Capital Stock, Authorized, Issued and
Fully Paid - 10,000 Shares of $100 Each 1,000,000
Surplus 4,222,188
Retained Earnings 19,605,350
Equity - Municipal Gain/Loss (22,212)
-----------
TOTAL CAPITAL ACCOUNTS 24,805,326
-----------
TOTAL LIABILITIES AND CAPITAL ACCOUNTS $49,941,318
-----------
I, Mark F. McLaughlin, Vice President, of the above-named bank do hereby
declare that this Report of Condition is true and correct to the best of my
knowledge and belief.
Mark F. McLaughlin
June 30, 1998
-4-
<PAGE>
We, the undersigned directors, attest to the correctness of this statement
of resources and liabilities. We declared that it has been examined by us, and
to the best of our knowledge and belief has been prepared in conformance with
the instructions and is true and correct.
Sanjiv Tandon
Kevin O. Healy
Steven R. Rothbloom
-5-
