THIS FIRST SUPPLEMENTAL INDENTURE, dated as of July 25, 1997, is
between JORDAN INDUSTRIES, INC., an Illinois corporation (the "Company"), and
FIRST TRUST NATIONAL ASSOCIATION, as trustee (herein called the "Trustee").
PRELIMINARY STATEMENT
The Company and the Trustee have entered into an Indenture (herein
called the "Indenture"), dated as of July 15, 1993 with respect to the
Company's 10 3/8% Senior Notes due 2003. Capitalized terms used herein, not
otherwise defined herein, shall have the meanings given them in the Indenture.
Section 9.02 of the Indenture provides that, under certain
circumstances, a supplemental indenture may be entered into by the Company and
the Trustee with the written consent of the Holders of at least a majority in
principal amount of the then outstanding Securities. In accordance with the
terms of Sections 9.02 and 9.06 of the Indenture, the Company has, by
resolution of the Board of Directors, authorized this First Supplemental
Indenture. The Trustee has determined that this First Supplemental Indenture
is in form satisfactory to it.
The Company has offered to purchase for cash all of the outstanding
Securities from the Holders and, in connection therewith, the Company
solicited consents to proposed amendments to the Indenture, pursuant to the
Offer to Purchase and Consent Solicitation Statement, dated June 21, 1997 (as
the same may be amended, supplemented or otherwise modified from time to time,
the "Offer to Purchase"). This First Supplemental Indenture evidences the
proposed amendments described in the Offer to Purchase.
All things necessary to make this First Supplemental Indenture a
valid agreement of the Company and the Trustee and a valid amendment of and
supplement to the Indenture have been done.
NOW, THEREFORE, THIS FIRST SUPPLEMENTAL INDENTURE WITNESSETH:
For and in consideration of the premises, it is mutually covenanted
and agreed, for the equal and proportionate benefit of all Holders of the
Securities issued under the Indenture from and after the date of this First
Supplemental Indenture, as follows:
Section 1. Amendment to the Indenture.
1.1 Deletions.
(a) Section 4.05 of the Indenture is hereby deleted in its entirety.
(b) Section 4.07 of the Indenture is hereby deleted in its entirety.
(c) Section 4.08 of the Indenture is hereby deleted in its entirety.
(d) Section 4.09 of the Indenture is hereby deleted in its entirety.
(e) Section 4.11 of the Indenture is hereby deleted in its entirety.
(f) Section 4.17 of the Indenture is hereby deleted in its entirety.
(g) Section 5.01 of the Indenture is hereby deleted in its entirety.
1.2 Restricted and Non-Restricted Subsidiaries.
(a) The definitions of "Non-Restricted Subsidiary" and
"Restricted Subsidiary" in Section 1.01 of the Indenture are
hereby amended and restated in their entirety to read as
follows:
"Non-Restricted Subsidiary" means Motors and Gears Holdings, Inc. and
its Subsidiaries, Jordan Telecommunication Products, Inc. and its Subsidiaries,
J.I. Properties, Inc., and any other Subsidiary of the Company other than a
Restricted Subsidiary, subject to Section 4.18.
"Restricted Subsidiary" means: (i) any Subsidiary of the Company
existing on the date of the First Supplemental Indenture, other than a
Non-Restricted Subsidiary, and (ii) any other Subsidiary of the Company
formed, acquired or existing after the date of the First Supplemental
Indenture that is designated as a Restricted Subsidiary by the Company
pursuant to a resolution approved by a majority of the Board of Directors,
subject, in each case, to Section 4.18.
(b) The following Section 4.18 is hereby added to the Indenture in
its numerically predetermined place:
Section 4.18 DESIGNATION OF RESTRICTED AND NON-RESTRICTED SUBSIDIARIES.
(a) Subject to the exceptions set forth below, from and after the date of the
First Supplemental Indenture, the Company may designate any existing or newly
formed Restricted Subsidiary as a Non-Restricted Subsidiary; provided that:
(i) either
(A) the Subsidiary to be so designated has total assets of
$1.0 million or less, or
(B) immediately before and after giving effect to such
designation, on a Pro Forma Basis, (1) the Company could
incur $1.00 of additional Indebtedness pursuant to Section
4.07, determined on a Pro Forma Basis, and (2) no Default
or Event of Default shall have occurred and be continuing,
or
(C) the Subsidiary to be so designated is organized under the
laws of a jurisdiction not within the United States and is
sold or transferred to a Non-Restricted Subsidiary in
accordance with Section 4.14, and
(ii) in any case, all transactions between the Subsidiary to be so
designated and its Affiliates remaining in effect are permitted
pursuant to Section 4.08.
(b) Any investment made by the Company or any Restricted Subsidiary which is
redesignated from a Restricted Subsidiary to a Non-Restricted Subsidiary shall
thereafter be considered as having been a Restricted Investment (to the extent
not previously included as a Restricted Payment) made on the day such
Subsidiary is designated as a NonRestricted Subsidiary in the amount of the
greater of:
(i) the fair market value (as determined by the Board of Directors
of the Company in good faith) of the Equity Interests of such
Subsidiary held by the Company and its Restricted Subsidiaries
on such date on a Pro Forma Basis, and
(ii) the amount of the Investments determined in accordance with GAAP
made by the Company and any of its Restricted Subsidiaries in
such Subsidiary.
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(c) Subject to the exceptions set forth below, from and after the date of the
First Supplemental Indenture, the Company may designate any existing or newly
formed Non-Restricted Subsidiary as a Restricted Subsidiary; provided that:
(i) immediately before and after giving effect to such designation,
on a Pro Forma Basis, the Company could incur any Indebtedness
of such Non-Restricted Subsidiary in accordance with Section
4.07, and
(ii) all transactions whereby such Non-Restricted Subsidiary is
designated a Restricted Subsidiary are permitted pursuant to
Section 4.08.
Any investment made by the Company or any Restricted Subsidiary in such
redesignated Non-Restricted Subsidiary will no longer be considered to be an
outstanding Restricted Investment.
(d) The designation of a Subsidiary as a Restricted Subsidiary or the removal
of such designation shall be made by a resolution adopted by a majority of the
Board of Directors of the Company stating that the Board of Directors has made
such designation in accordance with the Indenture, and the Company shall
deliver to the Trustee such resolution together with an Officers' Certificate
certifying that the designation complies with the Indenture. Such designation
shall be effective as of the date specified in the applicable resolution,
which may not be before the date the applicable Officers' Certificate is
delivered to the Trustee.
1.3 Definition of "Asset Sale."
The definition of "Asset Sale" in Section 1.01 of the Indenture is
hereby amended and restated in its entirety to read as follows:
"Asset Sale" means the sale, lease, conveyance or other disposition
by the Company or a Restricted Subsidiary of assets or property (other than
(i) the sale or disposition of any Restricted Investment, (ii) the sale or
lease of inventory, equipment, receivables or other assets in the ordinary
course of business, (iii) Receivables Financings, (iv) any sale or transfer of
properties or assets by the Company or a Restricted Subsidiary to the Company
or any other Restricted Subsidiary, (v) the designation of a Restricted
Subsidiary as a Non-Restricted Subsidiary, pursuant to Section 4.18, (vi) the
sale, lease, conveyance or other disposition of all or substantially all of
the assets of the Company permitted by Section 5.01, (vii) the sale or
disposition of obsolete equipment or other obsolete assets, (viii) Restricted
Payments permitted by Section 4.05, or (ix) any sale, lease, conveyance or
other disposition of assets or property in connection with the Refinancing and
Repositioning Plan of the Company and its Subsidiaries referenced in the
Offering Circular, dated July __, 1997, relating to the Company's offering and
placement of the __% Senior Notes due 2007, and all agreements, instruments
and transactions pursuant thereto.
1.4 Conforming Changes.
(a) The definitions of "Capital Lease Obligations," "Cash Flow,"
"Cash Flow Coverage Ratio," "Consolidated Interest Expense,"
"Consolidated Net Income," "Consolidated Net Worth,"
"Consulting Agreement," "Credit Agent," "Credit Agreement,"
"Dura-Line Agreement," "Disqualified Stock," "Net Income,"
"Other Permitted Indebtedness," "Permitted Liens,"
"Refinancing Indebtedness," "Refinancing Plan," "SFAS 106,"
"SFAS 109" and "Weighted Average Life to Maturity" set forth
in Section 1.01 of the Indenture are hereby deleted in their
entirety.
(b) Section 1.02 of the Indenture is hereby amended as follows:
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(i) The terms "Affiliate Transaction," "Other Indebtedness,"
"Other Indebtedness Guarantee" and "Restricted Payments"
are deleted therefrom; and
(ii) The terms "Disposition" and "Successor Corporation" shall
refer to Section 5.02.
(c) The second paragraph of Section 4.03 of the Indenture is
hereby amended by replacing the phrase "Section 4.01, 4.05,
4.06, 4.07, 4.08, 4.09, 4.10, 4.11, 4.12, 4.13, 4.14, 4.15,
4.16, or 4.17 or of Article 5" with the phrase "Section
4.01, 4.06, 4.10, 4.12, 4.13, 4.14, 4.15, or 4.16 or of
Article 5" where such phrase appears in such paragraph.
(g) Section 5.02 of the Indenture is hereby amended and restated
in its entirety to read as follows:
"Upon any consolidation or merger with or into, or sale,
lease, conveyance or other disposition of all or
substantially all of the assets of the Company (a
"Disposition"), the entity formed by or surviving any such
Disposition or the entity to which such Disposition shall
have been made (the "Successor Corporation") shall succeed
to, and be substituted for, and may exercise every right and
power of, the Company under this Indenture with the same
effect as if such Successor Corporation has been named as the
Company herein; provided, however, that neither the Company
nor the Successor Corporation shall be release from it
Obligation to pay the principal of, and premium, if any, and
interest on, the Securities."
(h) Section 6.01(b) of the Indenture is hereby amended by
replacing the first parenthetical therein with the
parenthetical "(other than a Default under Sections 4.13,
4.14, 4.15 and 4.16 and of which shall be an Event of
Default with the notice but without the passage of time
specified in this Section 6.01(b))".
(i) Section 8.01(b) of the Indenture is hereby amended as
follows:
(i) subclause (ii) of the first paragraph of Section
8.01(b) is hereby amended and restated in its entirety
to read as follows:
"(ii) its obligations under the Sections 4.02,
4.03, 4.06, 4.10, 4.13, 4.14, 4.15 and 4.16, and
the operation of Sections 6.01(a)(3) through
(a)(7) ("covenant defeasance option").
(ii) the second sentence of the second paragraph of Section
8.01(b) is hereby amended by deleting therefrom the
phrase "or because of the Company's failure to comply
with Sections 5.01(iii) or 5.01(iv)".
Section 2. Effectiveness; Termination
(a) This First Supplemental Indenture is entered into pursuant to and
consistent with Section 9.02 of the Indenture, and nothing herein shall
constitute an amendment, supplement or waiver requiring the approval of each
Holder pursuant to clauses (1) through (6) of the last paragraph of Section
9.02.
(b) This First Supplemental Indenture shall become effective and
binding on the Company, the Trustee and the Holders of the Securities upon the
execution and delivery by the parties to this First Supplemental Indenture;
provided, however, that the provisions of the Indenture referred to in Section
1 above (such provisions being referred to as the "Amended Provisions") will
remain in effect in the form they existed prior to the execution of this First
Supplemental Indenture, the deletions and amendments of the Amended Provisions
will not become
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operative, and the terms of the Indenture will not be amended, modified or
deleted, in each case until the date and time (the "Payment Date") that the
Company accepts for payment pursuant to the Offer to Purchase at least a
majority in principal amount of the outstanding Securities, and deposits the
payment therefore with the depositary for the Offer to Purchase. Upon the
Payment Date, the Amended Provisions will automatically be deleted or modified
as contemplated by Section 1 above.
Section 3. Reference to and Effect on the Indenture.
(a) On and after the Payment Date, each reference in the Indenture to
"the Indenture," "this Indenture," "hereunder," "hereof" or "herein" shall
mean and be a reference to the Indenture as supplemented by this First
Supplemental Indenture unless the context otherwise requires.
(b) Except as specifically amended above, the Indenture shall remain
in full force and effect and is hereby ratified and confirmed.
Section 4. Governing Law.
This First Supplemental Indenture shall be construed and enforced in
accordance with, and interpreted under, the internal laws of the State of New
York, without reference to the conflict of laws provisions thereof.
Section 5. Counterparts and Methods of Execution.
This First Supplemental Indenture may be executed in several
counterparts, all of which together shall constitute one agreement binding on
all parties, notwithstanding that all parties have not signed the same
counterpart.
Section 6. Titles.
Section titles are for descriptive purposes only and shall not
control or alter the meaning of this First Supplemental Indenture as set forth
in the text.
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IN WITNESS WHEREOF, the Company and the Trustee have caused this
First Supplemental Indenture to be duly executed by their respective officers
thereunto duly authorized all as of the day and year first above written.
JORDAN INDUSTRIES, INC.
By:
--------------------------------
Its: Senior Vice President
FIRST TRUST NATIONAL ASSOCIATION,
as Trustee
By:
--------------------------------
Its:
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STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
On the ____ day of July, 1997, before me personally came to me known,
who, being by me duly sworn, did depose and say that he resides at New York,
New York; that he is a ________________ of FIRST TRUST NATIONAL ASSOCIATION,
one of the banking corporations described herein and that executed the above
instrument; and that he signed his name thereto by order of the Board of
Directors of said corporation.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year in this certificate first above written.
[NOTARIAL SEAL]
-----------------------------------
Notary Public
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
On the ______ day of July, 1997, before me personally came , to me
known, who, being by me duly sworn, did depose and say that he resides at New
York, New York; that he is a ________________ of JORDAN INDUSTRIES, INC., the
corporation described herein and that executed the above instrument; and that
he signed his name thereto by order of the Board of Directors of said
corporation.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year in this certificate first above written.
[NOTARIAL SEAL]
-----------------------------------
Notary Public
