-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, BL6m7kkNqTYIq8tWUHvg+PGGPox3nmhzkDcUQWnv5Li61JNe+OeiE8QLgfl35wbm FnW0KojPVsovnfjRb7si3A== 0000950136-03-002376.txt : 20030926 0000950136-03-002376.hdr.sgml : 20030926 20030926141143 ACCESSION NUMBER: 0000950136-03-002376 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 32 CONFORMED PERIOD OF REPORT: 20030925 ITEM INFORMATION: Other events ITEM INFORMATION: Financial statements and exhibits FILED AS OF DATE: 20030926 FILER: COMPANY DATA: COMPANY CONFORMED NAME: JARDEN CORP CENTRAL INDEX KEY: 0000895655 STANDARD INDUSTRIAL CLASSIFICATION: WHOLESALE-MISCELLANEOUS NONDURABLE GOODS [5190] IRS NUMBER: 351828377 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-13665 FILM NUMBER: 03912104 BUSINESS ADDRESS: STREET 1: 555 THEODORE FREMD AVE CITY: RYE STATE: NY ZIP: 10580 BUSINESS PHONE: 914 967 9400 MAIL ADDRESS: STREET 1: 555 THEODORE FREMD STREET 2: AVE CITY: RYE STATE: NY ZIP: 10580 8-K 1 file001.txt FORM 8-K SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of Report (Date of earliest event reported) September 25, 2003 ------------------ Jarden Corporation (Exact name of registrant as specified in its charter)
Delaware 0-21052 35-1828377 - ------------------------------------------- ----------------------------------------- ----------------------------------------- (State or other jurisdiction of (Commission File Number) (IRS Employer Identification No.) incorporation) 555 Theodore Fremd Avenue, Rye, New York 10580 - ---------------------------------------------------------------- -------------------------------------------------------------- (Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (914) 967-9400 -------------- ------------------------------------------ (Former name or former address, if changed since last report.) Item 5. Other Events COMMON STOCK ISSUANCE On September 25, 2003, Jarden Corporation (the "Company") entered into an Underwriting Agreement with CIBC World Markets Corp. and Banc of America Securities LLC relating to the issuance of 2,800,000 shares (excluding the underwriters' overallotment option) (the "Shares") of the Company's common stock, par value $0.01 per share, under the Company's Registration Statement on Form S-3 (File No. 333-102387) and intends to consummate the sale of the Shares on September 30, 2003. Concurrently with this filing, we are filing with the Securities and Exchange Commission (the "Commission") a Final Prospectus Supplement to our shelf registration statement on Form S-3 (Registration No. 333-102387) (the "Registration Statement") pursuant to Rule 424(b) under the Securities Act of 1933, as amended, which supplement contemplates the issuance of 2,800,000 shares of our common stock, excluding the underwriters' over-allotment option. We are filing the Final Prospectus Supplement as Exhibit 99.1 to this Current Report on Form 8-K for the purpose of incorporating its contents in the Registration Statement. AMENDMENT OF EXISTING CREDIT FACILITY As of September 25, 2003, we amended our Amended and Restated Credit Agreement dated as of September 2, 2003 (the "Amended and Restated Credit Agreement"), pursuant to Amendment No. 1 to Amended & Restated Credit Agreement, dated as of September 25, 2003, by and among us, Bank of America, N.A., as Administrative Agent, each of the Lenders signatory thereto and each of the subsidiary guarantors ("Amendment No. 1"). Amendment No. 1 amends the prepayment section of the Amended and Restated Credit Agreement to provide that we shall not be required to make prepayments under the Amended and Restated Credit Agreement with the proceeds of an equity issuance that (i) occurs prior to January 31, 2004, and (ii) generates gross proceeds of less than $120 million dollars, for a period of 180 days after the date of such issuance. After such 180 day period, Amendment No. 1 provides that we will prepay to the lenders an amount equal to (a) 100% of the first $50 million dollars of the difference (but not less than $0) of the net proceeds of such issuance less amounts actually utilized to pay for certain enumerated acquisitions as well as any permitted acquisitions (as defined in the Amended and Restated Credit Agreement) less $50,000,000 and (b) 50% of any remaining net proceeds thereafter. A copy of Amendment No. 1 is attached to this report as Exhibit 10.9 and is incorporated herein by reference as through fully set forth herein. The foregoing summary description of Amendment No. 1 and the transactions contemplated thereby is not intended to be complete and is qualified in its entirety by the complete text of Amendment No. 1. Item 7. Financial Statements and Exhibits (c) Exhibits. The following exhibits are filed as part of this report: Exhibit Description - ------- ----------- 1.1 Underwriting Agreement, dated as of September 25, 2003, among the Company, CIBC World Markets Corp., and Banc of America Securities LLC. * 3.1 Certificate of Formation of Quoin, LLC.* 3.2 Operating Agreement of Quoin, LLC.* 3.3 Certificate of Formation of Hearthmark, LLC.* 3.4 Operating Agreement of Hearthmark, LLC.* 3.5 Certificate of Incorporation of O.W.D. Incorporated.* 3.6 Bylaws of O.W.D. Incorporated.* 3.7 Certificate of Incorporation of Tupper Lake Plastics, Incorporated.* 3.8 Bylaws of Tupper Lake Plastics, Incorporated.* 3.9 Certificate of Formation of X Properties, LLC.* 3.10 Operating Agreement of X Properties, LLC.* 3.11 Articles of Incorporation of Lehigh Consumer Products Corporation.* 3.12 Bylaws of Lehigh Consumer Products Corporation.* 4.1 First Supplemental Indenture to the Indenture, dated as of April 24, 2002 (the "April 2002 Indenture"), among Jarden, the guarantors named therein and The Bank of New York, as trustee, and form of note attached as Exhibit A thereto, dated as of May 7, 2003, among Jarden, the guarantors named therein and The Bank of New York, as trustee.* 4.2 Second Supplemental Indenture to the April 2002 Indenture, dated as of May 28, 2003, among Jarden, the guarantors named therein and The Bank of New York, as trustee.* 4.3 Third Supplemental Indenture to the April 2002 Indenture, dated as of September 25, 2003, among Jarden, the guarantors named therein and The Bank of New York, as trustee.* 4.4 Second Supplemental Indenture to the Indenture, dated as of January 29, 2003 (the "January 2003 Indenture"), between Jarden and The Bank of New York, as trustee, dated as of May 28, 2003, between Jarden, the guarantors named therein and The Bank of New York, as trustee.* 4.5 Third Supplemental Indenture to the January 2003 Indenture, dated as of August 28, 2003, among Jarden, the guarantors named therein and The Bank of New York, as trustee.* 4.6 Fourth Supplemental Indenture to the January 2003 Indenture, dated as of September 25, 2003, among Jarden, the guarantors named therein and The Bank of New York, as trustee.* 4.7 Registration Rights Agreement, dated as of May 8, 2003, among the Company, Alltrista Newco Corporation, Alltrista Plastics Corporation, Alltrista Zinc Products, L.P., Hearthmark, Inc., Quoin Corporation, Tilia, Inc., Tilia Direct, Inc., Tilia International, Inc., TriEnda Corporation, X Properties, LLC, CIBC World Markets Corp., and Bank of America Securities LLC.* 5.1 Opinion of Kane Kessler, P.C. * 10.1 Restricted Stock Award Agreement, dated as of May 8, 2003, between the Company and Martin E. Franklin.* 10.2 Amendment No. 1 dated, as of September 4, 2003, to the Restricted Stock Award Agreement, dated as of May 8, 2003, between the Company and Martin E. Franklin.* 10.3 Restricted Stock Award Agreement, dated as of May 8, 2003, between the Company and Ian G.H. Ashken.* 10.4 Amendment No. 1, dated as of September 4, 2003, to the Restricted Stock Award Agreement, dated as of May 8, 2003, between the Company and Ian G.H. Ashken.* 10.5 Restricted Stock Award Agreement, dated as of August 4, 2003, between the Company and James E. Lillie.* 10.6 Amendment No. 1, dated as of September 4, 2003, to the Restricted Stock Award Agreement, dated as of August 4, 2003, between the Company and James E. Lillie.* 10.7 Amendment No. 4, dated as of September 4, 2003, to the Restricted Stock Award Agreement, dated as of January 2, 2002, between the Company and Martin E. Franklin.* 10.8 Amendment No. 4, dated as of September 4, 2003, to the Restricted Stock Award Agreement, dated as of January 2, 2002, between the Company and Ian G. H. Ashken.* 10.9 Amendment No. 1, dated as of September 25, 2003, to the Amended and Restated Credit Agreement by and among the Company, Bank of America, N.A., as Administrative Agent, the Lenders signatory thereto and each of the Subsidiary Guarantors.* 99.1 Final Prospectus Supplement.* ------------- * Filed herewith. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. Dated: September 26, 2003 JARDEN CORPORATION By: /s/ Desiree DeStefano ---------------------------- Name: Desiree DeStefano Title: Senior Vice President EX-1.1 3 file002.txt UNDERWRITING AGREEMENT 2,800,000 Shares JARDEN CORPORATION Common Stock UNDERWRITING AGREEMENT September 25, 2003 CIBC World Markets Corp. Banc of America Securities LLC as Representatives of the several Underwriters named in Schedule I hereto c/o CIBC World Markets Corp. 417 5th Avenue, 2nd Floor New York, New York 10016 Ladies and Gentlemen: Jarden Corporation, a Delaware corporation (the "Company"), proposes, subject to the terms and conditions contained herein, to sell to you and the other underwriters named on Schedule I to this Agreement (the "Underwriters"), for whom you are acting as Representatives (the "Representatives"), an aggregate of 2,800,000 shares (the "Firm Shares") of the Company's common stock, $0.01 par value per share (the "Common Stock"). The respective amounts of the Firm Shares to be purchased by each of the several Underwriters are set forth opposite their names on Schedule I hereto. In addition, the Company proposes to grant to the Underwriters an option to purchase up to an additional 420,000 shares (the "Option Shares") of Common Stock from the Company for the purpose of covering over-allotments in connection with the sale of the Firm Shares. The Firm Shares and the Option Shares are collectively called the "Shares." The Company has prepared and filed in conformity with the requirements of the Securities Act of 1933, as amended (the "Securities Act"), and the published rules and regulations thereunder (the "Rules") adopted by the Securities and Exchange Commission (the "Commission") a Registration Statement (as hereinafter defined) on Form S-3 (No. 333-102387), including a preliminary prospectus relating to the Shares, and such amendments thereof as may have been required to the date of this Agreement. Copies of such Registration Statement (including all amendments thereof) and of the related Preliminary Prospectus (as hereinafter defined) have heretofore been delivered by the Company to you. The term "Preliminary Prospectus" means the preliminary prospectus dated September 8, 2003 or any subsequent preliminary prospectus included at any time thereafter as a part of the Registration Statement or filed with the Commission by the Company pursuant to Rule 424(a) of the Rules. The term "Registration Statement" as used in this Agreement means the initial registration statement (including all exhibits, financial schedules and all documents and information deemed to be a part of the Registration Statement through incorporation by reference or otherwise), as amended at the time and on the date it becomes effective (the "Effective Date"), including the information (if any) con- tained in the form of final prospectus filed with the Commission pursuant to Rule 424(b) of the Rules and deemed to be part thereof at the time of effectiveness pursuant to Rule 430A of the Rules. If the Company has filed an abbreviated registration statement to register additional Shares pursuant to Rule 462(b) under the Rules (the "462(b) Registration Statement"), then any reference herein to the Registration Statement shall also be deemed to include such 462(b) Registration Statement. The term "Prospectus" as used in this Agreement means the prospectus in the form included in the Registration Statement at the time of effectiveness or, if Rule 430A of the Rules is relied on, the term Prospectus shall also include the final prospectus filed with the Commission pursuant to Rule 424(b) of the Rules. Reference made herein to any Preliminary Prospectus or to the Prospectus shall be deemed to refer to and include any documents incorporated by reference therein pursuant to Item 12 of Form S-3 under the Securities Act, as of the date of such Preliminary Prospectus or the Prospectus, as the case may be, and any reference to any amendment or supplement to any Preliminary Prospectus or the Prospectus shall be deemed to refer to and include any document filed under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), after the date of such Preliminary Prospectus or the Prospectus, as the case may be, and incorporated by reference in such Preliminary Prospectus or the Prospectus, as the case may be. The Company understands that the Underwriters propose to make a public offering of the Shares, as set forth in and pursuant to the Prospectus, as soon after the Effective Date and the date of this Agreement as the Representatives deem advisable. The Company hereby confirms that the Underwriters and dealers have been authorized to distribute or cause to be distributed each Preliminary Prospectus and are authorized to distribute the Prospectus (as from time to time amended or supplemented if the Company furnishes amendments or supplements thereto to the Underwriters). 1. Sale, Purchase, Delivery and Payment for the Shares. On the basis of the representations, warranties and agreements contained in, and subject to the terms and conditions of, this Agreement: (a) The Company agrees to issue and sell to each of the Underwriters, and each of the Underwriters agrees, severally and not jointly, to purchase from the Company, at a purchase price of $35.15 per share (the "Initial Price"), the number of Firm Shares set forth opposite the name of such Underwriter under the column "Number of Firm Shares to be Purchased from the Company" on Schedule I to this Agreement, subject to adjustment in accordance with Section 8 hereof. (b) The Company hereby grants to the several Underwriters an option to purchase, severally and not jointly, all or any part of the Option Shares at the Initial Price. The number of Option Shares to be purchased by each Underwriter shall be the same percentage (adjusted by the Representatives to eliminate fractions) of the total number of Option Shares to be purchased by the Underwriters as such Underwriter is purchasing of the Firm Shares. Such option may be exercised only to cover over-allotments in the sales of the Firm Shares by the Underwriters and may be exercised in whole or in part at any time on or before 12:00 noon, New York City time, on the business day before the Firm Shares Closing Date (as defined below), and from time to time thereafter within 30 days after the date of this Agreement, in each case upon -2- written, facsimile or telegraphic notice, or verbal or telephonic notice confirmed by written, facsimile or telegraphic notice, by the Representatives to the Company no later than 12:00 noon, New York City time, on the business day before the Firm Shares Closing Date or at least two business days before the Option Shares Closing Date (as defined below), as the case may be, setting forth the number of Option Shares to be purchased and the time and date (if other than the Firm Shares Closing Date) of such purchase. (c) Payment of the purchase price for, and delivery of certificates for, the Firm Shares shall be made at the offices of CIBC World Markets Corp., One World Financial Center, New York, New York 10281, at 10:00 a.m., New York City time, on the third business day following the date of this Agreement or at such time on such other date, not later than ten (10) business days after the date of this Agreement, as shall be agreed upon by the Company and the Representatives (such time and date of delivery and payment are called the "Firm Shares Closing Date"). In addition, in the event that any or all of the Option Shares are purchased by the Underwriters, payment of the purchase price, and delivery of the certificates, for such Option Shares shall be made at the above-mentioned offices, or at such other place as shall be agreed upon by the Representatives and the Company, on each date of delivery as specified in the notice from the Representatives to the Company (such time and date of delivery and payment are called the "Option Shares Closing Date"). The Firm Shares Closing Date and any Option Shares Closing Date are called, individually, a "Closing Date" and, together, the "Closing Dates." (d) Payment shall be made to the Company by wire transfer of immediately available funds or by certified or official bank check or checks payable in New York Clearing House (same day) funds drawn to the order of the Company, against delivery of the respective certificates to the Representatives for the respective accounts of the Underwriters of certificates for the Shares to be purchased by them. (e) Certificates evidencing the Shares shall be registered in such names and shall be in such denominations as the Representatives shall request at least two full business days before the Firm Shares Closing Date or, in the case of Option Shares, on the day of notice of exercise of the option as described in Section 1(b) and shall be delivered by or on behalf of the Company to the Representatives through the facilities of The Depository Trust Company ("DTC") for the account of such Underwriter. The Company will cause the certificates representing the Shares to be made available for checking and packaging, at such place as is designated by the Representatives, on the full business day before the Firm Shares Closing Date (or the Option Shares Closing Date in the case of the Option Shares). (2) Representations and Warranties of the Company. The Company represents and warrants to each Underwriter as of the date hereof, as of the Firm Shares Closing Date and as of each Option Shares Closing Date (if any), as follows: (a) On the Effective Date, the Registration Statement complied, and on the date of the Prospectus, the date any post-effective amendment to the Registration Statement becomes effective, the date any supplement or amendment to the Prospectus is filed with the Commission and each Closing Date, the Registration Statement and the Prospectus (and any amendment thereof or supplement thereto) will comply, in all material respects, with the applicable provisions of the Securities Act and the Exchange Act. The Registration Statement did -3- not, as of the Effective Date, contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements therein not misleading; and on the Effective Date and the other dates referred to above neither the Registration Statement nor the Prospectus, nor any amendment thereof or supplement thereto, will contain any untrue statement of a material fact or will omit to state any material fact required to be stated therein or necessary in order to make the statements therein not misleading. When any related preliminary prospectus was first filed with the Commission (whether filed as part of the Registration Statement or any amendment thereto or pursuant to Rule 424(a) of the Rules) and when any amendment thereof or supplement thereto was first filed with the Commission, such preliminary prospectus as amended or supplemented complied in all material respects with the applicable provisions of the Securities Act and the Rules and did not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading. If applicable, each Preliminary Prospectus and the Prospectus delivered to the Underwriters for use in connection with this offering was identical to the electronically transmitted copies thereof filed with the Commission pursuant to EDGAR, except to the extent permitted by Regulation S-T. If Rule 434 is used, the Company will comply with the requirements of Rule 434 and the Prospectus shall not be "materially different," as such term is used in Rule 434, from the Prospectus included in the Registration Statement at the time it became effective. Notwithstanding the foregoing, none of the representations and warranties in this paragraph 4(a) shall apply to statements in, or omissions from, the Registration Statement or the Prospectus made in reliance upon, and in conformity with, information herein or otherwise furnished in writing by the Representatives on behalf of the several Underwriters for use in the Registration Statement or the Prospectus. With respect to the preceding sentence, the Company acknowledges that the only information furnished in writing by the Representatives on behalf of the several Underwriters for use in the Registration Statement or the Prospectus is the statements contained in the third through sixth sentences of the fourth paragraph, the tenth paragraph and the sixteenth paragraph under the caption "Underwriting" in the Prospectus. (b) The Registration Statement is effective under the Securities Act and no stop order preventing or suspending the effectiveness of the Registration Statement or suspending or preventing the use of the Prospectus has been issued by the Commission and no proceedings for that purpose have been instituted or are threatened under the Securities Act. Any required filing of the Prospectus and any supplement thereto pursuant to Rule 424(b) of the Rules has been or will be made in the manner and within the time period required by such Rule 424(b). (c) The documents incorporated by reference in the Registration Statement and the Prospectus, at the time they became effective or were filed with the Commission, as the case may be, (i) complied in all material respects with the requirements of the Securities Act or the Exchange Act, as applicable, and (ii) when read together with the other information in the Registration Statement and the Prospectus do not contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading. Any further documents so filed and incorporated by reference in the Registration Statement and the Prospectus, when such documents become effective or are filed with the Commission, as the case may be, will conform in all material respects to the requirements of the Securities Act or -4- the Exchange Act, as applicable, 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 are made, not misleading. (d) The financial statements of the Company and of Lehigh Consumer Products Corporation ("Lehigh") (including all notes and schedules thereto) included or incorporated by reference in the Registration Statement and Prospectus present fairly in all material respects the respective financial position, the statement of operations, stockholders' equity and cash flows of the Company and its consolidated subsidiaries and of Lehigh at the respective dates and for the respective periods to which they apply; and such financial statements and related schedules and notes thereto, and the unaudited financial information filed with the Commission as part of the Registration Statement, have been prepared in conformity with generally accepted accounting principles. The summary and selected financial data included in the Prospectus present fairly in all material respects the information shown therein as at the respective dates and for the respective periods specified and have been presented on a basis consistent with the consolidated financial statements set forth in the Prospectus and other financial information. The pro forma financial statements and the related notes thereto included in the Registration Statement and the Prospectus present fairly in all material respects the information shown therein, have been prepared in accordance with the Securities Act and the Exchange Act, and the assumptions used in the preparation thereof are reasonable and are set forth in the Prospectus and the Registration Statement. (e) Ernst & Young LLP and PricewaterhouseCoopers LLP, whose reports are filed with the Commission as a part of the Registration Statement, are and, during the periods covered by their reports, were independent public accountants as required by the Securities Act and the Rules. (f) The Company and each of its subsidiaries, including each entity (corporation, partnership, joint venture, association or other business organization) controlled directly or indirectly by the Company, is duly organized, validly existing and in good standing under the laws of their respective jurisdictions of incorporation or organization. The Company and each of its subsidiaries is duly qualified to do business and is in good standing as a foreign corporation in each jurisdiction in which the nature of the business conducted by it or location of the assets or properties owned, leased or licensed by it requires such qualification, except for such jurisdictions where the failure to so qualify individually or in the aggregate could not reasonably be expected to have a material adverse effect on the assets, properties, business, financial condition or results of operations of the Company and its subsidiaries considered as a whole (a "Material Adverse Effect"). (g) The Company and each of its subsidiaries has all requisite corporate power and authority, and all necessary authorizations, approvals, consents, orders, licenses, certificates and permits of and from all governmental or regulatory bodies or any other person or entity (collectively, the "Permits"), to own, lease and license its assets and properties and conduct its business, all of which are valid and in full force and effect, except where the lack of such Permits, individually or in the aggregate, could not reasonably be expected to have a Material Adverse Effect. The Company and each of its subsidiaries has fulfilled and performed in all ma- -5- terial respects all of its material obligations with respect to such Permits and no event has occurred that allows, or after notice or lapse of time would allow, revocation or termination thereof or results in any other material impairment of the rights of the Company thereunder. (h) Except as disclosed in the Prospectus, the Company and each of its subsidiaries owns or possesses legally enforceable rights to use all trademarks, trademark applications, trade names, service marks, copyrights, copyright applications, licenses, know-how and other similar rights and proprietary knowledge (collectively, "Intangibles") necessary for the conduct of its business taken as a whole, except where the lack of such ownership or possession could not reasonably be expected to have a Material Adverse Effect. Neither the Company nor any of its subsidiaries has received any notice of, or is not aware of, any infringement of or conflict with asserted rights of others with respect to any Intangibles that if determined adversely to the Company or its Subsidiaries would have a Material Adverse Effect. (i) The Company and each of its subsidiaries has good and marketable title in fee simple to all real property, and good and marketable title to all other property owned by it, in each case free and clear of all liens, encumbrances, claims, security interests and defects, except such as do not materially affect the value of such property and do not materially interfere with the use made or proposed to be made of such property by the Company and its subsidiaries or except such as could not reasonably be expected to have a Material Adverse Effect. All property held under lease by the Company and its subsidiaries is held by them under valid, existing and enforceable leases, free and clear of all liens, encumbrances, claims, security interests and defects, except such as are not material and do not materially interfere with the use made or proposed to be made of such property by the Company and its subsidiaries and except such as could not reasonably be expected to have a Material Adverse Effect. Subsequent to the respective dates as of which information is given in the Registration Statement and the Prospectus, (i) there has not been any Material Adverse Effect; (ii) neither the Company nor any of its subsidiaries has sustained any loss or interference with its assets, businesses or properties (whether owned or leased) from fire, explosion, earthquake, flood or other calamity, whether or not covered by insurance, or from any labor dispute or any court or legislative or other governmental action, order or decree which would have a Material Adverse Effect; and (iii) since the date of the latest balance sheet included or incorporated by reference in the Registration Statement and the Prospectus, except as disclosed in the Prospectus, neither the Company nor its subsidiaries has (A) issued any securities or incurred any material liability or obligation, direct or contingent, for borrowed money, except such liabilities or obligations incurred in the ordinary course of business, (B) entered into any material transaction not in the ordinary course of business or (C) declared or paid any dividend or made any distribution on any shares of its stock or redeemed, purchased or otherwise acquired or agreed to redeem, purchase or otherwise acquire any shares of its capital stock. (j) There is no document, contract or other agreement required to be described in the Registration Statement or Prospectus or to be filed as an exhibit to the Registration Statement which is not described or filed as required by the Securities Act or Rules. Each description of a contract, document or other agreement in the Registration Statement and the Prospectus accurately reflects in all material respects the terms of the underlying contract, document or other agreement. Each contract, document or other agreement described in the Registration -6- Statement and Prospectus or listed in the Exhibits to the Registration Statement or incorporated by reference is in full force and effect and is valid and enforceable by and against the Company or its subsidiary, as the case may be, in accordance with its terms. Neither the Company nor any of its subsidiaries, if a subsidiary is a party, nor to the Company's knowledge, any other party is in default in the observance or performance of any term or obligation to be performed by it under any such agreement, and no event has occurred which with notice or lapse of time or both would constitute such a default, in any such case which default or event, individually or in the aggregate, would have a Material Adverse Effect. No default exists, and no event has occurred which with notice or lapse of time or both would constitute a default, in the due performance and observance of any term, covenant or condition, by the Company or its subsidiary, if a subsidiary is a party thereto, of any other agreement or instrument to which the Company or any of its subsidiaries is a party or by which Company or its properties or business or a subsidiary or its properties or business may be bound or affected which default or event, individually or in the aggregate, would have a Material Adverse Effect. (k) Neither the Company nor any of its subsidiaries is in violation of any term or provision of its charter or by-laws or of any franchise, license, permit, judgment, decree, order, statute, rule or regulation, where the consequences of such violation, individually or in the aggregate, could reasonably be expected to have a Material Adverse Effect. (l) This Agreement has been duly authorized, executed and delivered by the Company. (m) Neither the execution, delivery and performance of this Agreement by the Company nor the consummation of any of the transactions contemplated hereby (including, without limitation, the issuance and sale by the Company of the Shares) will (i) give rise to a right to terminate or accelerate the due date of any payment due under, or conflict with or result in the breach of any term or provision of, or constitute a default (or an event which with notice or lapse of time or both would constitute a default) under, or require any consent or waiver under, or result in the execution or imposition of any lien, charge or encumbrance upon any properties or assets of the Company or its subsidiaries pursuant to the terms of, any indenture, mortgage, deed of trust or other agreement or instrument to which the Company or any of its subsidiaries is a party or by which either the Company or its subsidiaries or any of their properties or businesses is bound, or any franchise, license, permit, judgment, decree, order, statute, rule or regulation applicable to the Company or any of its subsidiaries except in each such instance where the consequences could not reasonably be expected to have a Material Adverse Effect or (ii) violate any provision of the charter or by-laws of the Company or any of its subsidiaries, except in each case under clauses (i) and (ii) where effective consents or waivers which have already been obtained and are in full force and effect. (n) The Company has authorized and outstanding capital stock as set forth in footnote 1 under the caption "The Offering" in the Prospectus. The certificates evidencing the Shares are in due and proper legal form and have been duly authorized for issuance by the Company. All of the issued and outstanding shares of Common Stock have been duly and validly issued and are fully paid and nonassessable. There are no statutory preemptive or other similar rights to subscribe for or to purchase or acquire any shares of Common Stock of the Company or -7- any such rights pursuant to its Certificate of Incorporation or by-laws or any agreement or instrument to or by which the Company is a party or bound. The Shares, when issued and sold pursuant to this Agreement, will be duly and validly issued, fully paid and nonassessable and none of them will be issued in violation of any preemptive or other similar right. Except as disclosed in the Registration Statement and the Prospectus, there is no outstanding option, warrant or other right calling for the issuance of, and there is no commitment, plan or arrangement to issue, any share of stock of the Company or any of its subsidiaries or any security convertible into, or exercisable or exchangeable for, such stock. The Common Stock and the Shares conform in all material respects to all statements in relation thereto contained in the Registration Statement and the Prospectus. All outstanding shares of capital stock of each of the Company's subsidiaries have been duly authorized and validly issued, and are fully paid and nonassessable and are owned directly by the Company or by another wholly-owned subsidiary of the Company free and clear of any security interests, liens, encumbrances, equities or claims, other than those described in the Prospectus. (o) No holder of any security of the Company has any right, which has not been waived, to have any security owned by such holder included in the Registration Statement or to demand registration of any security owned by such holder for a period of 90 days after the date of this Agreement. Each director and executive officer of the Company and each stockholder of the Company listed on Schedule II has delivered to the Representatives his enforceable written lock-up agreement in the form attached to this Agreement as Exhibit A hereto ("Lock-Up Agreement"). (p) All necessary corporate action has been duly and validly taken by the Company and to authorize the execution, delivery and performance of this Agreement and the issuance and sale of the Shares by the Company. This Agreement has been duly and validly authorized, executed and delivered by the Company. (q) Neither the Company nor any of its subsidiaries is involved in a labor dispute nor, to the knowledge of the Company, is any labor dispute threatened, except any dispute which, in either case, could not reasonably be expected to have a Material Adverse Effect. (r) No transaction has occurred between or among the Company and any of its officers or directors, stockholders or any affiliate or affiliates of any such officer or director or stockholder that is required to be described in and is not described in the Registration Statement and the Prospectus. (s) The Company has not taken, nor will it take, directly or indirectly, any action designed to or which might reasonably be expected to cause or result in, or which has constituted or which might reasonably be expected to constitute, the stabilization or manipulation of the price of the Common Stock or any security of the Company to facilitate the sale or resale of any of the Shares. (t) The Company and each of its subsidiaries has (i) filed all Federal, state, local and foreign tax returns which are required to be filed through the date hereof (except where the Company or its Subsidiaries has received extensions thereof), and (ii) paid all taxes shown on such returns and all assessments received by it to the extent that the same are material and have -8- become due, except in each case under clause (i) and (ii) where the failure to so file or pay could not reasonably be expected to have a Material Adverse Effect. To the knowledge of the Company, there are no tax audits or investigations pending, which if adversely determined could reasonably be expected to have a Material Adverse Effect; nor to the knowledge of the Company are there any material proposed additional tax assessments against the Company or any of its subsidiaries. (u) The Shares have been duly authorized for listing on the New York Stock Exchange. (v) The Company has taken no action intended to, or that could reasonably be expected to have the effect of, terminating the registration of the Common Stock under the Exchange Act or listing on the New York Stock Exchange, nor has the Company received any notification that the Commission or the New York Stock Exchange is contemplating terminating such registration or quotation. (w) The books, records and accounts of the Company and its subsidiaries accurately and fairly reflect, in all material respects, the transactions in, and dispositions of, the assets of, and the results of operations of, the Company and its subsidiaries. The Company and each of its subsidiaries maintains a system of internal accounting controls sufficient to provide reasonable assurances that (i) transactions are executed in accordance with management's general or specific authorizations, (ii) transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles and to maintain asset accountability, (iii) access to assets is permitted only in accordance with management's general or specific authorization and (iv) the recorded accountability for assets is compared with the existing assets at reasonable intervals and appropriate action is taken with respect to any differences. (x) The Company and its subsidiaries are insured by insurers of recognized financial responsibility against such losses and risks and in such amounts as are in accordance with normal industry practice in the businesses in which they are engaged; all policies of insurance and fidelity or surety bonds insuring the Company or any of its subsidiaries or the Company's or its subsidiaries' respective businesses, assets, employees, officers and directors are in full force and effect; the Company and each of its subsidiaries are in compliance with the terms of such policies and instruments in all material respects. (y) Each approval, consent, order, authorization, designation, declaration or filing of, by or with any regulatory, administrative or other governmental body necessary in connection with the execution and delivery by the Company of this Agreement and the consummation of the transactions herein contemplated required to be obtained or performed by the Company (except such additional steps as may be required by the National Association of Securities Dealers, Inc. (the "NASD") or may be necessary to qualify the Shares for public offering by the Underwriters under the state securities or Blue Sky laws) has been obtained or made and is in full force and effect. (z) To the knowledge of the Company, after due inquiry, there are no affiliations with the NASD among the Company's officers, directors or, to the knowledge of the Com- -9- pany, any five percent or greater stockholder of the Company, except as set forth in the Registration Statement or otherwise disclosed in writing to the Representatives. (aa) Except as otherwise disclosed in the Registration Statement or as could not individually or in the aggregate reasonably be expected to have a Material Adverse Effect (i) each of the Company and each of its subsidiaries is in compliance in all material respects with all rules, laws and regulation relating to the use, treatment, storage and disposal of toxic substances and protection of health or the environment ("Environmental Law") which are applicable to its business; (ii) neither the Company nor its subsidiaries has received any notice from any governmental authority or third party of an asserted claim under Environmental Laws; and (iii) each of the Company and each of its subsidiaries has received all permits, licenses or other approvals required of it under applicable Environmental Laws to conduct its business and is in compliance with all terms and conditions of any such permit, license or approval. (bb) To the knowledge of the Company, based upon the Company's periodic review of the effect of Environmental Laws on the business, operations and properties of the Company and its subsidiaries, in the course of which the Company identifies and evaluates associated costs and liabilities (including, without limitation, any capital or operating expenditures required for clean-up, closure of properties or compliance with Environmental Laws, or any permit, license or approval, any related constraints on operating activities and any potential liabilities to third parties). The Company has reasonably concluded that such associated costs and liabilities could not, singly or in the aggregate, reasonably be expected to have a Material Adverse Effect. (cc) The Company is not and, after giving effect to the offering and sale of the Shares and the application of proceeds thereof as described in the Prospectus, will not be an "investment company" within the meaning of the Investment Company Act of 1940, as amended (the "Investment Company Act"). (dd) None of the Company, nor to the knowledge of the Company, any director, officer, agent or employee of the Company or its subsidiaries, has, directly or indirectly, while acting on behalf of the Company or its subsidiaries (i) used any corporate funds for unlawful contributions, gifts, entertainment or other unlawful expenses relating to political activity; (ii) made any unlawful payment to foreign or domestic government officials or employees or to foreign or domestic political parties or campaigns from corporate funds; (iii) violated any provision of the Foreign Corrupt Practices Act of 1977, as amended; or (iv) made any other unlawful payment. (ee) Except as described in the Prospectus or in the documents incorporated by reference into the Prospectus, the Company has not sold or issued any shares of Common Stock during the six-month period preceding the date of the Prospectus, including any sales pursuant to Rule 144A under, or Regulations D or S of, the Securities Act, other than shares issued pursuant to employee benefit plans, qualified stock option plans or other employee compensation plans or pursuant to outstanding options, rights or warrants. (ff) The Company has fulfilled its obligations, if any, under the minimum funding standards of Section 302 of the U.S. Employee Retirement Income Security Act of 1974 -10- ("ERISA") and the regulations and published interpretations thereunder with respect to each "plan" as defined in Section 3(3) of ERISA and such regulations and published interpretations in which its employees are eligible to participate and each such plan is in compliance in all material respects with the presently applicable provisions of ERISA and such regulations and published interpretations except where failure to be in compliance could not reasonably be expected to have a Material Adverse Effect. No "Reportable Event" (as defined in Section 12 of ERISA) has occurred with respect to any "Pension Plan" (as defined in ERISA) for which the Company could have any liability. (gg) Each of the Company, its directors and officers has not distributed and will not distribute prior to the later of (i) the Firm Shares Closing Date, or the Option Shares Closing Date, and (ii) completion of the distribution of the Shares, any offering material in connection with the offering and sale of the Shares other than any Preliminary Prospectus, the Prospectus, the Registration Statement and other materials, if any, permitted by the Securities Act. (hh) The Company (a) has a class of securities registered pursuant to Section 12(b) of the Exchange Act, (b) has been subject to the requirements of Section 12 of the Exchange Act and has filed all the material required to be filed pursuant to Section 13, 14 or 15(d) for a period of at least 36 calendar months immediately preceding the date hereof and (c) has filed in a timely manner all reports required to be filed during the 12 calendar months any portion of a month immediately preceding the date hereof and, if the Company has used (during the 12 calendar months and any portion of a month immediately preceding the date hereof) Rule 12b-25(b) under the Exchange Act with respect to a report or a portion of a report, that report or portion thereof has actually been filed within the time period prescribed by the rule. (ii) Neither the Company nor any of its consolidated or unconsolidated subsidiaries have, since the end of the last fiscal year for which certified financial statements of the Company and its consolidated subsidiaries were included in a report filed pursuant to Section 13(a) or 15(d) of the Exchange Act (a) failed to pay any dividend or sinking fund installment on preferred stock, or (b) defaulted (i) on any installment or installments on indebtedness for borrowed money, or (ii) on any rental on one or more long-term leases, which defaults in the aggregate are material to the financial position of the registrant and its consolidated and unconsolidated subsidiaries, taken as a whole. (jj) The aggregate market value of the voting stock held by non-affiliates of the Company is $150 million or more, or alternatively, the aggregate market value of the voting stock held by non-affiliates of the Company is $100 million or more and the Company has had an annual trading volume of such stock of three million shares or more. For purposes of this Section, "aggregate market value" shall be computed by use of the price at which the stock was last sold or the average of the bid and asked prices of such stock, as of a date within 60 days prior to the date hereof; and "annual trading volume" shall be the volume of shares traded in any continuous 12-month period ended within 60 days prior to the date hereof. (kk) The Shares are of a class of equity securities for which a "bona fide independent market" (as such term is defined in Rule 2720 of the National Association of Securities Dealers, Inc. Manual) exists or existed as of the date of the filing of the Registration Statement, the effective date thereof and the date hereof. -11- (ll) Schedule A attached hereto contains a list of each subsidiary of the Company that (i) meets the definition of "significant subsidiary" under Regulation S-X or (ii) is material to the assets, properties, business, financial condition or the results of operations of the Company and its subsidiaries, considered as a whole (the "Material Subsidiaries"). Schedule B attached hereto contains a list of all jurisdictions where the Company is required to be in good standing, except where the failure of the Company to be in good standing could not reasonably be expected to have a Material Adverse Effect (the "Material Jurisdictions"). (mm) The Company and each of its subsidiaries is in material compliance with the applicable provisions of the Sarbanes-Oxley Act of 2002 that are effective as of the date hereof. 3. Conditions of the Underwriters' Obligations. The obligations of the Underwriters under this Agreement are several and not joint. The respective obligations of the Underwriters to purchase the Shares are subject to each of the following terms and conditions: (a) Notification that the Registration Statement has become effective shall have been received by the Representatives and the Prospectus shall have been timely filed with the Commission in accordance with Section 4(a) of this Agreement. (b) No order preventing or suspending the use of any preliminary prospectus or the Prospectus shall have been or shall be in effect and no order suspending the effectiveness of the Registration Statement shall be in effect and no proceedings for such purpose shall be pending before or threatened by the Commission, and any requests for additional information on the part of the Commission (to be included in the Registration Statement or the Prospectus or otherwise) shall have been complied with to the satisfaction of the Commission and the Representatives. If the Company has elected to rely upon Rule 430A, Rule 430A information previously omitted from the effective Registration Statement pursuant to Rule 430A shall have been transmitted to the Commission for filing pursuant to Rule 424(b) within the prescribed time period and the Company shall have provided evidence satisfactory to the Underwriters of such timely filing, or a post-effective amendment providing such information shall have been promptly filed and declared effective in accordance with the requirements of Rule 430A. If the Company has elected to rely upon Rule 434, a term sheet shall have been transmitted to the Commission for filing pursuant to Rule 424(b) within the prescribed time period. (c) The representations and warranties of the Company contained in this Agreement and in the certificates delivered pursuant to Section 3(d) shall be true and correct in all material respects when made and on and as of each Closing Date as if made on such date. The Company shall have performed all covenants and agreements and satisfied all the conditions contained in this Agreement required to be performed or satisfied by them at or before such Closing Date in all material respects. (d) The Representatives shall have received on each Closing Date a certificate, addressed to the Representatives and dated such Closing Date, of the chief executive or chief operating officer and the chief financial officer or chief accounting officer of the Company to the effect that: (i) the representations, warranties and agreements of the Company in this Agreement were true and correct when made and are true and correct as of such Closing Date in all material respects; (ii) the Company has performed all covenants and agreements and -12- satisfied all conditions contained herein in all material respects; (iii) they have carefully examined the Registration Statement and the Prospectus and, in their opinion (A) as of the Effective Date, the Registration Statement and Prospectus did not include any untrue statement of a material fact and did not 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, and (B) since the Effective Date, to the Company's knowledge, no event has occurred which should have been set forth in a supplement or otherwise required an amendment to the Registration Statement or the Prospectus; and (iv) no stop order suspending the effectiveness of the Registration Statement has been issued and, to their knowledge, no proceedings for that purpose have been instituted or are pending under the Securities Act. (e) The Representatives shall have received, at the time this Agreement is executed and on each Closing Date a signed letter from each of (i) Ernst & Young LLP and (ii) PricewaterhouseCoopers LLP addressed to the Representatives and dated, respectively, the date of this Agreement and each such Closing Date, in form and substance reasonably satisfactory to the Representatives containing statements and information of the type ordinarily included in accountants' "comfort letters" to underwriters with respect to the financial statements and certain financial information contained in the Registration Statement and the Prospectus. (f) The Representatives shall have received on each Closing Date from Kane Kessler, PC, counsel for the Company, an opinion, addressed to the Representatives and dated such Closing Date, and stating in effect that: (i) The Company and each of its Material Subsidiaries has been duly organized and is validly existing as a corporation in good standing under the laws of the jurisdiction of its incorporation. Each of the Company and its Material Subsidiaries is duly qualified to transact business and is in good standing as a foreign corporation in the Material Jurisdictions. (ii) The Company and its Material Subsidiaries incorporated in Delaware has all requisite corporate power and authority to own, lease and operate its properties and to conduct its business as now being conducted and as described in the Registration Statement and the Prospectus and with respect to the Company to enter into and perform its obligations under this Agreement and to issue and sell the Shares . (iii) The authorized capital stock of the Company is as set forth in the Registration Statement and the Prospectus in footnote 1 under the caption "The Offering" as of the dates stated therein and, to such counsel's knowledge, since such dates, there has been no change in the authorized capital stock of the Company. The Shares to be issued and sold by the Company pursuant to this Agreement have been duly authorized for issuance and sale to the Underwriters pursuant to this Agreement and, when issued and delivered by the Company pursuant to this Agreement against full payment of the consideration set forth herein, will be validly issued, fully paid and nonassessable, and no holder of the Shares is or will be subject to personal liability by reason of being such a holder. The issuance and sale of the Shares by the Company is not subject to any preemptive rights of any securityholder of the Company pursuant to the Material Agreements. To the best of -13- such counsel's knowledge, except as disclosed in the Registration Statement and the Prospectus, there are no preemptive rights to subscribe for or to purchase or any restriction upon the voting or transfer of any capital stock of the Company pursuant to the Company's Certificate of Incorporation or by-laws or the Material Agreements. The form of certificate used to evidence the Common Stock complies in all material respects with all applicable statutory requirements, with any applicable requirements of the Certificate of Incorporation or By-laws of the Company and the requirements of the New York Stock Exchange. To such counsel's knowledge, there are no persons with rights to have any securities registered pursuant to the Registration Statement by the Company under the Securities Act. (iv) All necessary corporate action has been duly and validly taken by the Company to authorize the execution, delivery and performance of this Agreement and the issuance and sale of the Shares. This Agreement has been duly and validly authorized, executed and delivered by the Company. (v) Neither the execution, delivery and performance of this Agreement by the Company nor the consummation of any of the transactions contemplated by this Agreement will (A) conflict with or result in the breach of any term or provision of, or constitute a default (or any event which with notice or lapse of time, or both, would constitute a default) under, or require consent or waiver under, or result in the execution or imposition of any lien, charge, claim, security interest or encumbrance upon any properties or assets of the Company or any Material Subsidiary pursuant to (i) any agreement filed as an exhibit to the Registration Statement, the Company's Annual Report on Form 10-K for the year ended December 31, 2002, the Company's Quarterly Reports on Form 10-Q for the periods ended March 31, 2003 and June 30, 2003 and any Reports on Form 8-K filed by the Company since December 31, 2002 (collectively, the "Material Agreements"), except where the failure to comply with which could not reasonably be expected to have a Material Adverse Effect, (ii) any statute, rule or regulation of any governmental agency or body or any authority of the United States of America or the State of Delaware applicable to the Company, except where the failure to comply with which could not reasonably be expected to have a Material Adverse Effect or (iii) to such counsel's knowledge, any judgment, decree or order of any court or governmental agency or body of the United States of America or the State of Delaware applicable to the Company set forth in the officers' certificate to be attached to such opinion (if any) or (B) contravene any provision of the Charter or Bylaws of the Company, as amended. (vi) No consent, approval, authorization, or other order of, or registration or filing with any court or other governmental agency or regulatory body is required to be obtained or made by the Company for the consummation of the transactions contemplated hereby, except such as have been obtained under the Securities Act in connection with the purchase and distribution of the Shares by the several Underwriters and from the New York Stock Exchange in connection with the approval of the Shares for listing. (vii) The statements in the Registration Statement under Item 15 of Part II, insofar as such statements constitute a summary of documents referred to therein or matters -14- of law, are accurate in all material respects and accurately present in all material respects the information with respect to such documents and matters. (viii) The Registration Statement and the Prospectus and each amendment or supplement thereto (except for the financial statements and schedules and other financial data included therein, as to which such counsel expresses no opinion) comply as to form in all material respects with the requirements of the Securities Act (except for the financial statements and schedules and other financial data included therein, as to which such counsel expresses no opinion) when they became effective or were filed with the Commission, as the case may be. (ix) The Registration Statement is effective under the Securities Act, and based solely upon a telephone call to the Securities and Exchange Commission, no stop order suspending the effectiveness of the Registration Statement has been issued and no proceedings for that purpose have been instituted or are threatened, pending or contemplated. Any required filing of the Prospectus and any supplement thereto pursuant to Rule 424(b) under the Securities Act has been made in the manner and within the time period required by such Rule 424(b). (x) The Shares have been approved for listing on the New York Stock Exchange. (xi) The capital stock of the Company conforms in all material respects to the description thereof contained in the first two sentences of the first paragraph, the third sentence of the first paragraph as modified by the information contained in the last sentence under the caption "Price Range of Common Stock and Dividend Policy," the first sentence of the second paragraph, and the first two sentences of the fourth paragraph, each under the caption "Description of Capital Stock" of the Prospectus. (xii) The Company is not an "investment company" or an entity controlled by an "investment company" as such terms are defined in the Investment Company Act of 1940, as amended. To the extent deemed advisable by such counsel, such counsel may rely as to matters of fact on certificates of responsible officers of the Company and public officials and on the opinions of other counsel satisfactory to the Representatives as to matters which are governed by laws other than the laws of the State of New York, the General Corporation Law of the State of Delaware and the Federal laws of the United States; provided that such counsel shall state that in their opinion the Underwriters and they are justified in relying on such other opinions. Copies of such certificates and other opinions shall be furnished to the Representatives and counsel for the Underwriters. In addition, such counsel shall state that such counsel has participated in conferences with officers and other representatives of the Company, representatives of the Representatives and representatives of the independent certified public accountants of the Company, at which conferences the contents of the Registration Statement and the Prospectus and related matters were discussed and, although such counsel is not passing -15- upon and does not assume any responsibility for the accuracy, completeness or fairness of the statements contained in the Registration Statement and the Prospectus (except as specified in the foregoing opinion), on the basis of the foregoing, no facts have come to the attention of such counsel which lead such counsel to believe that (i) the Registration Statement at the time it became effective (except with respect to the financial statements and notes and schedules thereto and other financial data, as to which such counsel need express no belief) contained any untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary to make the statements contained therein not misleading, or that the Prospectus as amended or supplemented (except with respect to the financial statements, notes and schedules thereto and other financial data, as to which such counsel need make no statement) on the date thereof contained any untrue statement of a material fact or omitted to state a material fact necessary in order to make the statements contained therein, in the light of the circumstances under which they were made, not misleading or (ii) any document incorporated by reference in the Prospectus or any further amendment or supplement to any such incorporated document made by the Company, when they were filed with the Commission, contained, in the case of a registration statement which became effective under the Securities Act, any untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary in order to make the statements contained therein not misleading, or, in the case of other documents which were filed under the Exchange Act with the Commission, any untrue statement of a material fact or omitted to state a material fact necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading. (g) The Representatives shall have received on each Closing Date from Cahill Gordon & Reindel llp, counsel for the Representatives, an opinion, addressed to the Representatives and otherwise satisfactory to them. (h) All proceedings taken in connection with the sale of the Firm Shares and the Option Shares as herein contemplated shall be reasonably satisfactory in form and substance to the Representatives and their counsel. (i) The Representatives shall have received copies of the Lock-up Agreements executed by each entity or person listed on Schedule II hereto. (j) The Shares shall have been approved for listing on the New York Stock Exchange, subject only to official notice of issuance. (k) The Representatives shall have received on the date hereof and on each Option Shares Closing Date a certificate, addressed to the Representatives and dated as of the date hereof or as of such Closing Date, as the case may be, of an officer of Lehigh reasonably satisfactory to counsel for the Representatives. (l) The Company shall have furnished or caused to be furnished to the Representatives such further certificates or documents as the Representatives shall have reasonably requested. -16- 4. Covenants of the Company. (a) The Company covenants and agrees as follows: (i) The Company will use its best efforts to cause the Registration Statement, if not effective at the time of execution of this Agreement, and any amendments thereto, to become effective as promptly as possible. The Company shall prepare the Prospectus in a form approved by the Representatives and file such Prospectus pursuant to Rule 424(b) under the Securities Act not later than the Commission's close of business on the second business day following the execution and delivery of this Agreement, or, if applicable, such earlier time as may be required by the Rules. (ii) The Company shall promptly advise the Representatives in writing (A) when any post-effective amendment to the Registration Statement shall have become effective or any supplement to the Prospectus shall have been filed, (B) of any request by the Commission for any amendment of the Registration Statement or the Prospectus or for any additional information, (C) of the issuance by the Commission of any stop order suspending the effectiveness of the Registration Statement or of any order preventing or suspending the use of any preliminary prospectus or the institution or threatening of any proceeding for that purpose and (D) of the receipt by the Company of any notification with respect to the suspension of the qualification of the Shares for sale in any jurisdiction or the initiation or threatening of any proceeding for such purpose. The Company shall not file any amendment of the Registration Statement or supplement to the Prospectus or any document incorporated by reference in the Registration Statement unless the Company has furnished the Representatives a copy for its review prior to filing and shall not file any such proposed amendment or supplement to which the Representatives reasonably object. The Company shall use its best efforts to prevent the issuance of any such stop order and, if issued, to obtain as soon as possible the withdrawal thereof. (iii) If, at any time when a prospectus relating to the Shares is required to be delivered under the Securities Act and the Rules, any event occurs as a result of which the Prospectus as then amended or supplemented would include any untrue statement of a material fact or omit to state any material fact necessary to make the statements therein in the light of the circumstances under which they were made not misleading, or if it shall be necessary to amend or supplement the Prospectus to comply with the Securities Act or the Rules, the Company promptly shall prepare and file with the Commission, subject to the second sentence of paragraph (ii) of this Section 4(a), an amendment or supplement which shall correct such statement or omission or an amendment which shall effect such compliance. (iv) The Company shall make generally available to its security holders and to the Representatives as soon as practicable, but not later than 50 days after the end of the 12-month period beginning at the end of the fiscal quarter of the Company during which the Effective Date occurs (or 105 days if such 12-month period coincides with the Company's fiscal year), an earnings statement (which need not be audited) of the Company, covering such 12-month period, which shall satisfy the provisions of Section 11(a) of the Securities Act or Rule 158 of the Rules. -17- (v) The Company shall furnish to the Representatives and counsel for the Underwriters, without charge, signed copies of the Registration Statement (including all exhibits thereto and amendments thereof) and to each other Underwriter a copy of the Registration Statement (without exhibits thereto) and all amendments thereof and, so long as delivery of a prospectus by an Underwriter or dealer may be required by the Securities Act or the Rules, as many copies of any preliminary prospectus and the Prospectus and any amendments thereof and supplements thereto as the Representatives may reasonably request. If applicable, the copies of the Registration Statement and Prospectus and each amendment and supplement thereto furnished to the Underwriters will be identical to the electronically transmitted copies thereof filed with the Commission pursuant to EDGAR, except to the extent permitted by Regulation S-T. (vi) The Company shall cooperate with the Representatives and their counsel in endeavoring to qualify the Shares for offer and sale in connection with the offering under the laws of such jurisdictions as the Representatives may designate and shall maintain such qualifications in effect so long as required for the distribution of the Shares; provided, however, that the Company shall not be required in connection therewith, as a condition thereof, to qualify as a foreign corporation or to execute a general consent to service of process in any jurisdiction or subject itself to taxation as doing business in any jurisdiction. (vii) The Company, during the period when the Prospectus is required to be delivered under the Securities Act and the Rules or the Exchange Act, will file all reports and other documents required to be filed with the Commission pursuant to Section 13, 14 or 15 of the Exchange Act within the time periods required by the Exchange Act and the regulations promulgated thereunder. (viii) Without the prior written consent of CIBC World Markets Corp. and Banc of America Securities LLC, for a period of 90 days after the date of this Agreement, the Company shall not issue, sell or register with the Commission (other than on Form S-8 or on any successor form), or otherwise dispose of, directly or indirectly, any equity securities of the Company (or any securities convertible into, exercisable for or exchangeable for equity securities of the Company), except for the issuance of the Shares pursuant to the Registration Statement or as otherwise described in the section entitled "Underwriters" in the Registration Statement and the Prospectus. In the event that during this period, any shares are issued to directors of the Company or to persons who qualify as "named executive officers" of the Company, as defined in Item 402 to Regulation S-K, such shares shall be subject to the Lock-Up Agreement executed by such director or named executive officer. (ix) On or before completion of this offering, the Company shall make all filings required under applicable securities laws and by the New York Stock Exchange. (x) Prior to the Closing Date, the Company will issue no press release or other communications directly or indirectly and hold no press conference with respect to the Company, the condition, financial or otherwise, or the earnings, business affairs or business prospects of any of them, or the offering of the Shares without the prior written con- -18- sent of the Representatives unless in the judgment of the Company and its counsel, and after notification to the Representatives, such press release or communication is required by law. (xi) The Company will apply the net proceeds from the offering of the Shares in the manner set forth under "Use of Proceeds" in the Prospectus. (b) The Company agrees to pay, or reimburse if paid by the Representatives, whether or not the transactions contemplated hereby are consummated or this Agreement is terminated, all costs and expenses incident to the public offering of the Shares and the performance of the obligations of the Company under this Agreement including those relating to: (i) the preparation, printing, filing and distribution of the Registration Statement including all exhibits thereto, each preliminary prospectus, the Prospectus, all amendments and supplements to the Registration Statement and the Prospectus and any document incorporated by reference therein, and the printing, filing and distribution of this Agreement; (ii) the preparation and delivery of certificates for the Shares to the Underwriters; (iii) the registration or qualification of the Shares for offer and sale under the securities or Blue Sky laws of the various jurisdictions referred to in Section 4(a)(vi), including the reasonable fees and disbursements of counsel for the Underwriters in connection with such registration and qualification and the preparation, printing, distribution and shipment of preliminary and supplementary Blue Sky memoranda; (iv) the furnishing (including costs of shipping and mailing) to the Representatives and to the Underwriters of copies of each preliminary prospectus, the Prospectus and all amendments or supplements to the Prospectus, and of the several documents required by this Section to be so furnished, as may be reasonably requested for use in connection with the offering and sale of the Shares by the Underwriters or by dealers to whom Shares may be sold; (v) the filing fees of the NASD in connection with its review of the terms of the public offering and reasonable fees and disbursements of counsel for the Underwriters in connection with such review; (vi) inclusion of the Shares for listing on the New York Stock Exchange; and (vii) all transfer taxes, if any, with respect to the sale and delivery of the Shares by the Company to the Underwriters. Subject to the provisions of Section 7, the Underwriters agree to pay, whether or not the transactions contemplated hereby are consummated or this Agreement is terminated, all costs and expenses incident to the performance of the obligations of the Underwriters under this Agreement not payable by the Company pursuant to the preceding sentence, including, without limitation, the fees and disbursements of counsel for the Underwriters. 5. Indemnification. (a) The Company agrees to indemnify and hold harmless each Underwriter and each person, if any, who controls any Underwriter within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act against any and all losses, claims, damages and liabilities, joint or several (including any reasonable investigation, legal and other expenses incurred in connection with, and any amount paid in settlement of, any action, suit or proceeding or any claim asserted), to which they, or any of them, may become subject under the Securities Act, the Exchange Act or other Federal or state law or regulation, at common law or otherwise, insofar as such losses, claims, damages or liabilities arise out of or are based upon (i) any untrue statement or alleged untrue statement of a material fact contained in any preliminary prospectus, -19- the Registration Statement or the Prospectus or any amendment thereof or supplement thereto, or in any Blue Sky application or other information or other documents executed by the Company filed in any state or other jurisdiction to qualify any or all of the Shares under the securities laws thereof (any such application, document or information being hereinafter referred to as a "Blue Sky Application") or arise out of or are based upon any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading; provided, however, that such indemnity shall not inure to the benefit of any Underwriter (or any person controlling such Underwriter) on account of any losses, claims, damages or liabilities arising from the sale of the Shares to any person by such Underwriter if such untrue statement or omission or alleged untrue statement or omission was made in such preliminary prospectus, the Registration Statement or the Prospectus, or such amendment or supplement thereto, or in any Blue Sky Application in reliance upon and in conformity with information furnished in writing to the Company by the Representatives on behalf of any Underwriter specifically for use therein and provided further that such indemnity shall not inure to the benefit of any Underwriter (or any person controlling such Underwriter) on account of any loss, claim, damage or liability arising out of any such untrue statement or alleged untrue statement or omission or alleged omission in any Preliminary Prospectus if the Company shall have timely furnished copies of the Prospectus to such Underwriter and such Underwriter shall not have given or sent a copy of the Prospectus to the person who purchased Shares from such Underwriter and who is asserting such loss, claim, damage or liability, if required by law to have been delivered, at or prior to the written confirmation of the sale of Shares to such person by such Underwriter, to the extent that the Prospectus would have cured such defect or alleged defect giving rise to such loss, claim, damage or liability. This indemnity agreement will be in addition to any liability which the Company may otherwise have. (b) Each Underwriter agrees to indemnify and hold harmless the Company, and each person, if any, who controls the Company within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act, each director of the Company, and each officer of the Company who signs the Registration Statement, against any losses, claims, damages or liabilities to which such party may become subject, under the Securities Act or otherwise, insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon an untrue statement or alleged untrue statement of a material fact contained in any preliminary prospectus, the Registration Statement or the Prospectus, or any amendment or supplement thereto, or arise out of or are based upon the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, in each case to the extent, but only to the extent, that such untrue statement or alleged untrue statement or omission or alleged omission was made in any preliminary prospectus, the Registration Statement or the Prospectus or any such amendment or supplement in reliance upon and in conformity with written information furnished to the Company by such Underwriter through the Representative expressly for use therein; provided, however, that the obligation of each Underwriter to indemnify the Company (including any controlling person, director or officer thereof) shall be limited to the net proceeds received by the Company from such Underwriter. (c) Any party that proposes to assert the right to be indemnified under this Section will, promptly after receipt of notice of commencement of any action, suit or proceeding -20- against such party in respect of which a claim is to be made against an indemnifying party or parties under this Section, notify each such indemnifying party of the commencement of such action, suit or proceeding, enclosing a copy of all papers served. No indemnification provided for in Section 5(a) or 5(b) shall be available to any party who shall fail to give notice as provided in this Section 5(c) if the party to whom notice was not given was unaware of the proceeding to which such notice would have related and was prejudiced by the failure to give such notice but the omission so to notify such indemnifying party of any such action, suit or proceeding shall not relieve it from any liability that it may have to any indemnified party for contribution or otherwise than under this Section. In case any such action, suit or proceeding shall be brought against any indemnified party and it shall notify the indemnifying party of the commencement thereof, the indemnifying party shall be entitled to participate in, and, to the extent that it shall wish, jointly with any other indemnifying party similarly notified, to assume the defense thereof, with counsel reasonably satisfactory to such indemnified party, and after notice from the indemnifying party to such indemnified party of its election so to assume the defense thereof and the approval by the indemnified party of such counsel, the indemnifying party shall not be liable to such indemnified party for any legal or other expenses, except as provided below and except for the reasonable costs of investigation subsequently incurred by such indemnified party in connection with the defense thereof. The indemnified party shall have the right to employ its counsel in any such action, but the fees and expenses of such counsel shall be at the expense of such indemnified party unless (i) the employment of counsel by such indemnified party has been authorized in writing by the indemnifying parties, (ii) the indemnified party shall have been advised by counsel that there may be one or more legal defenses available to it which are different from or in addition to those available to the indemnifying party (in which case the indemnifying parties shall not have the right to direct the defense of such action on behalf of the indemnified party), it being understood, however, that the indemnifying parties shall not be liable for the expenses of more than one separate counsel (in addition to local counsel) representing the indemnified parties in connection with any one action or related actions in the same jurisdiction arising out of the same general allegations or circumstances or (iii) the indemnifying parties shall not have employed counsel to assume the defense of such action within a reasonable time after notice of the commencement thereof, in each of which cases the fees and expenses of counsel shall be at the expense of the indemnifying parties. An indemnifying party shall not be liable for any settlement of any action, suit, and proceeding or claim effected without its written consent, which consent shall not be unreasonably withheld or delayed. 6. Contribution. In order to provide for just and equitable contribution in circumstances in which the indemnification provided for in Section 5(a) or 5(b) is due in accordance with its terms but for any reason is unavailable to or insufficient to hold harmless an indemnified party in respect to any losses, liabilities, claims, damages or expenses referred to therein, then each indemnifying party shall contribute to the aggregate losses, liabilities, claims, damages and expenses (including any investigation, legal and other expenses reasonably incurred in connection with, and any amount paid in settlement of, any action, suit or proceeding or any claims asserted, but after deducting any contribution received by any person entitled hereunder to contribution from any person who may be liable for contribution) incurred by such indemnified party, as incurred, in such proportion as is appropriate to reflect the relative benefits received by the Company on the one hand and the Underwriters on the other hand from the offering of the Shares pursuant to this Agreement or, if such allocation is not permitted by applicable law, in -21- such proportion as is appropriate to reflect not only the relative benefits referred to above but also the relative fault of the Company on the one hand and the Underwriters on the other hand in connection with the statements or omissions which resulted in such losses, liabilities, claims, damages or expenses, as well as any other relevant equitable considerations. The Company and the Underwriters agree that it would not be just and equitable if contribution pursuant to this Section 6 were determined by pro rata allocation (even if the Underwriters were treated as one entity for such purpose) or by any other method of allocation which does not take account of the equitable considerations referred to above. The aggregate amount of losses, liabilities, claims, damages and expenses incurred by an indemnified party and referred to above shall be deemed to include any legal or other expenses reasonably incurred by such indemnified party in investigating, preparing or defending against any litigation, or any investigation or proceeding by any governmental agency or body, commenced or threatened, or any claim whatsoever based upon any such untrue or alleged untrue statement or omission or alleged omission. Notwithstanding the provisions of this Section 6, no Underwriter (except as may be provided in the Agreement Among Underwriters) shall be required to contribute any amount that, in the aggregate, exceeds the total discount and commissions received by such Underwriter less the amount of damages which such Underwriter has otherwise been required to pay by reason of any such untrue or alleged untrue statement or omission or alleged omission. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. For purposes of this Section 6, each person, if any, who controls an Underwriter within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act shall have the same rights to contribution as such Underwriter, and each director of the Company including any person who, with his or her consent, is named in the Registration Statement as about to become a director of the Company, each officer of the Company who signed the Registration Statement, and each person, if any, who controls the Company within the meaning of the Section 15 of the Securities Act or Section 20 of the Exchange Act, shall have the same rights to contribution as the Company. Any party entitled to contribution will, promptly after receipt of notice of commencement of any action, suit or proceeding against such party in respect of which a claim for contribution may be made against another party or parties under this Section 6, notify such party or parties from whom contribution may be sought, but the omission so to notify such party or parties from whom contribution may be sought shall not relieve the party or parties from whom contribution may be sought from any other obligation it or they may have hereunder or otherwise than under this Section 6. No party shall be liable for contribution with respect to any action, suit, proceeding or claim settled without its written consent. The Underwriter's obligations to contribute pursuant to this Section 6 are several in proportion to their respective underwriting commitments and not joint. 7. Termination. (a) This Agreement may be terminated with respect to the Shares to be purchased on a Closing Date by the Representatives by notifying the Company at any time at or before a Closing Date in the absolute discretion of the Representatives if: (i) there has occurred any material adverse change in the securities markets or any event, act or occurrence that has materially disrupted, or in the commercially reasonable judgment of the Representatives, will in the future materially disrupt, the securities markets or there shall be such a material adverse -22- change in general financial, political or economic conditions or the effect of international conditions on the financial markets in the United States is such as to make it, in the judgment of the Representatives, inadvisable or impracticable to market the Shares or enforce contracts for the sale of the Shares; (ii) there has occurred any outbreak or material escalation of hostilities or other calamity or crisis the effect of which on the financial markets of the United States is such as to make it, in the judgment of the Representatives, inadvisable or impracticable to market the Shares or enforce contracts for the sale of the Shares; (iii) trading in the Shares or any securities of the Company has been suspended or materially limited by the Commission or trading generally on the New York Stock Exchange, Inc., the American Stock Exchange, Inc. or the Nasdaq National Market has been suspended or materially limited, or minimum or maximum ranges for prices for securities shall have been fixed, or maximum ranges for prices for securities have been required, by said any of said exchanges or by such system or by order of the Commission, the National Association of Securities Dealers, Inc., or any other governmental or regulatory authority; (iv) a banking moratorium has been declared by any state or Federal authority; or (v) in the judgment of the Representatives, there has been, since the time of execution of this Agreement or since the respective dates as of which information is given in the Prospectus, a change that could reasonably be expected to have a Material Adverse Effect. (b) If this Agreement is terminated pursuant to any of its provisions, the Company shall not be under any liability to any Underwriter, and no Underwriter shall be under any liability to the Company, except that (y) if this Agreement is terminated by the Representatives or the Underwriters because of any failure, refusal or inability on the part of the Company to comply with the terms or to fulfill any of the conditions of this Agreement, the Company will reimburse the Underwriters for all out-of-pocket expenses (including the reasonable fees and disbursements of their counsel) incurred by them in connection with the proposed purchase and sale of the Shares or in contemplation of performing their obligations hereunder and (z) no Underwriter who shall have failed or refused to purchase the Shares agreed to be purchased by it under this Agreement, without some reason sufficient hereunder to justify cancellation or termination of its obligations under this Agreement, shall be relieved of liability to the Company, or to the other Underwriters for damages occasioned by its failure or refusal. 8. Substitution of Underwriters. If any Underwriter shall default in its obligation to purchase on any Closing Date the Shares agreed to be purchased hereunder on such Closing Date, the Representatives shall have the right, within 36 hours thereafter, to make arrangements for one or more of the non-defaulting Underwriters, or any other underwriters, to purchase such Shares on the terms contained herein. If, however, the Representatives shall not have completed such arrangements within such 36-hour period, then the Company shall be entitled to a further period of thirty-six hours within which to procure another party or other parties satisfactory to the Underwriters to purchase such Shares on such terms. If, after giving effect to any arrangements for the purchase of the Shares of a defaulting Underwriter or Underwriters by the Representatives and the Company as provided above, the aggregate number of Shares which remains unpurchased on such Closing Date does not exceed 15% of the aggregate number of all the Shares that all the Underwriters are obligated to purchase on such date, then the Company shall have the right to require each non-defaulting Underwriter to purchase the number of Shares which such Underwriter agreed to purchase hereunder at such date and, in addition, to require each non-defaulting Underwriter to purchase its pro rata share (based on the number of Shares -23- which such Underwriter agreed to purchase hereunder) of the Shares of such defaulting Underwriter or Underwriters for which such arrangements have not been made; but nothing herein shall relieve a defaulting Underwriter from liability for its default. In any such case, either the Representatives or the Company shall have the right to postpone the applicable Closing Date for a period of not more than seven days in order to effect any necessary changes and arrangements (including any necessary amendments or supplements to the Registration Statement or Prospectus or any other documents), and the Company agrees to file promptly any amendments to the Registration Statement or the Prospectus which in the opinion of the Company and the Underwriters and their counsel may thereby be make necessary. If, after giving effect to any arrangements for the purchase of the Shares of a defaulting Underwriter or Underwriters by the Representatives and the Company as provided above, the aggregate number of such Shares which remains unpurchased exceeds 10% of the aggregate number of all the Shares to be purchased at such date, then this Agreement, or, with respect to a Closing Date which occurs after the First Closing Date, the obligations of the Underwriters to purchase and of the Company, as the case may be, to sell the Option Shares to be purchased and sold on such date, shall terminate, without liability on the part of any non-defaulting Underwriter to the Company, and without liability on the part of the Company, except as provided in Sections 4(b), 5, 6 and 7. The provisions of this Section 8 shall not in any way affect the liability of any defaulting Underwriter to the Company or the nondefaulting Underwriters arising out of such default. The term "Underwriter" as used in this Agreement shall include any person substituted under this Section 8 with like effect as if such person had originally been a party to this Agreement with respect to such Shares. 9. Miscellaneous. The respective agreements, representations, warranties, indemnities and other statements of the Company and the several Underwriters, as set forth in this Agreement or made by or on behalf of them pursuant to this Agreement, shall remain in full force and effect, regardless of any investigation (or any statement as to the results thereof) made by or on behalf of any Underwriter or the Company or any of their respective officers, directors or controlling persons referred to in Sections 5 and 6 hereof, and shall survive delivery of and payment for the Shares. In addition, the provisions of Sections 4(b), 5, 6 and 7 shall survive the termination or cancellation of this Agreement. This Agreement has been and is made for the benefit of the Underwriters, the Company and their respective successors and assigns, and, to the extent expressed herein, for the benefit of persons controlling any of the Underwriters, or the Company, and directors and officers of the Company, and their respective successors and assigns, and no other person shall acquire or have any right under or by virtue of this Agreement. The term "successors and assigns" shall not include any purchaser of Shares from any Underwriter merely because of such purchase. All notices and communications hereunder shall be in writing and mailed or delivered or by telephone or telegraph if subsequently confirmed in writing, (a) if to the Representatives, c/o CIBC World Markets Corp., 417 5th Avenue, 2nd Floor, New York, New York 10016 Attention: Jay Eastman, with a copy to Cahill Gordon & Reindel llp, 80 Pine Street, New York, New York 10022, Attention: Roger Meltzer, Esq. and (b) if to the Company, to its -24- agent for service as such agent's address appears on the cover page of the Registration Statement with a copy to Kane Kessler, PC, 1350 Avenue of the Americas, 26th Floor, New York, New York 10019, Attention: Robert L. Lawrence, Esq. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND TO BE FULLY PERFORMED THEREIN. THIS AGREEMENT AND THE TRANSACTIONS CONTEMPLATED HEREBY SHALL BE SUBJECT TO THE EXCLUSIVE JURISDICTION OF THE COURTS OF NEW YORK COUNTY, NEW YORK. THE PARTIES TO THIS AGREEMENT AGREE THAT ANY BREACH OF ANY TERM OR CONDITION OF THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY SHALL BE DEEMED TO BE A BREACH OCCURRING IN THE STATE OF NEW YORK BY VIRTUE OF A FAILURE TO PERFORM AN ACT REQUIRED TO BE PERFORMED IN THE STATE OF NEW YORK. THE PARTIES TO THIS AGREEMENT IRREVOCABLY AND EXPRESSLY AGREE TO SUBMIT TO THE JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK FOR THE PURPOSE OF RESOLVING ANY DISPUTES AMONG THE PARTIES RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY. THE PARTIES IRREVOCABLY WAIVE, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH THEY MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT AND THE TRANSACTIONS CONTEMPLATED HEREBY, OR ANY JUDGMENT ENTERED BY ANY COURT IN RESPECT HEREOF BROUGHT IN NEW YORK COUNTY, NEW YORK, AND FURTHER IRREVOCABLY WAIVE ANY CLAIM THAT ANY SUIT, ACTION OR PROCEEDING BROUGHT IN NEW YORK COUNTY, NEW YORK HAS BEEN BROUGHT IN AN INCONVENIENT FORUM. -25- This Agreement may be signed in any number of counterparts, each of which shall be an original, with the same effect as if the signatures thereto and hereto were upon the same instrument. Please confirm that the foregoing correctly sets forth the agreement among us. Very truly yours, JARDEN CORPORATION By: /s/ Desiree DeStefano --------------------------------------- Name: Desiree DeStefano Title: Senior Vice President Confirmed: CIBC WORLD MARKETS CORP. BANC OF AMERICA SECURITIES LLC Acting severally on behalf of itself and as representative of the several Underwriters named in Schedule I annexed hereto. By: CIBC WORLD MARKETS CORP. By: /s/ Jay S. Eastman ---------------------------------- Name: Jay S. Eastman Title: Managing Director By: BANC OF AMERICA SECURITIES LLC By: /s/ Thomas M. Morrison ---------------------------------- Name: Thomas M. Morrison Title: Managing Director -26- EX-3.1 4 file003.txt CERTIFICATE OF FORMATION OF QUOIN, LLC CERTIFICATE OF FORMATION OF QUOIN, LLC ------------------- The undersigned, an authorized natural person, for the purpose of forming a limited liability company, under the provisions and subject to the requirements of the State of Delaware (particularly Chapter 18, Title 6 of the Delaware Code and the acts amendatory thereof and supplemental thereto, and known, identified, and referred to as the "Delaware Limited Liability Company Act"), hereby certifies that: FIRST: The name of the limited liability company (hereinafter called the "Limited Liability Company") is QUOIN, LLC. SECOND: The address of the registered office and the name and the address of the registered agent of the Limited Liability Company required to be maintained by Section 18-104 of the Delaware Limited Liability Company Act are: Corporation Service Company 2711 Centerville Road, Suite 400 Wilmington, Delaware 19808 THIRD: The Limited Liability Company shall, to the fullest extent permitted by the provisions of the Delaware Limited Liability Company Act, as the same may be amended and supplemented, indemnify the members, managers, officers and directors of the Limited Liability Company. Dated: September 19, 2003 /s/ Mitchell D. Hollander ------------------------- Mitchell D. Hollander Authorized Person EX-3.2 5 file004.txt OPERATING AGREEMENT OF QUOIN, LLC OPERATING AGREEMENT OF QUOIN, LLC This Operating Agreement (this "Agreement") of QUOIN, LLC, a Delaware limited liability company (the "Company"), is entered into as of the 19th day of September, 2003 by and between Jarden Corporation (the "Member") and the Company. Pursuant to and in accordance with the Limited Liability Company Act of the State of Delaware, as amended from time to time (the "LLCA"), the Member and the Company hereby agree as follows: 1. NAME. The name of the limited liability company shall be QUOIN, LLC. 2. OFFICE. The principal office of the Company shall be located at 555 Theodore Fremd Avenue, Rye, New York 10580 or such other place or places as the Member shall determine. 3. TERM. The term of the Company commenced as of the date of filing of the Certificate of Formation of the Company with the Secretary of State of the State of Delaware and the Company shall be dissolved and its affairs wound up as provided in said Certificate, in this Agreement, or as otherwise provided in the LLCA. 4. PURPOSE. The Company is formed for the purpose of engaging in any lawful act or activity for which limited liability companies may be organized under the LLCA and engaging in any and all activities necessary or incidental to the foregoing. 5. MEMBER. The name and the mailing address of the Member is as follows: Name Address ---- ------- Jarden Corporation 555 Theodore Fremd Avenue Rye, NY 10580 The Member is authorized to admit additional members and/or create different classes of members. 6. MANAGEMENT; POWERS. The business and affairs of the Company shall be managed by the Member. The Member is authorized to execute any and all documents on behalf of the Company necessary or appropriate in connection with the acquisition, financing, operation, management or development of any property of the Company. The Member may appoint one or more officers who shall be authorized to exercise such of the Member's rights and power as designated by the Member. 7. ACTION BY WRITTEN CONSENT. Whenever the Member is required or permitted to take any action by vote or consent, action may be taken without a meeting, without prior notice and without a vote, if written consent or consents setting forth the action taken are signed by the Member or any officers appointed by the Member, and are delivered to the office of the Company, its principal place of business, or an employee or agent of the Company. 8. CAPITAL CONTRIBUTIONS. The initial capitalization of the Company by the Member is set forth on Schedule A. 9. ADDITIONAL CONTRIBUTIONS. The Member is not required to make any additional capital contribution to the Company, provided however, that additional capital contributions may be made at such time and in such amounts as the Member shall determine. 10. MEMBER LOANS. If, at any time, additional funds are needed by the Company beyond the capital contributed by the Member, the Member may from time to time make voluntary loans to the Company. 11. ALLOCATION OF PROFITS AND LOSSES. The Company's profits and losses shall be allocated to the Member as set forth on Schedule A. 12. DISTRIBUTIONS. Distributions shall be made to the Member at the times and in the aggregate amounts determined by the Member and in accordance with the same percentages as profits and losses are allocated. 13. ADMISSION OF ADDITIONAL MEMBERS. The Member may cause the Company to admit one or more additional members to the Company. 14. LIABILITY OF MEMBERS. The Member shall not have any liability for the obligations or liabilities of the Company. 15. EXCULPATION OF MEMBER. The Member shall not be liable to the Company for any breach of duty in such capacity, unless otherwise required by law. 16. INDEMNIFICATION. The Company shall indemnify and hold harmless the Member, and all members, officers, representatives and other agents of the Member, to the fullest extent permitted by law from and against any and all losses, claims, damages, liabilities, expenses (including legal and other professional fees and disbursements), judgments, fines, settlements and other amounts (collectively, the "Indemnification Obligations") arising from any and all claims, demands, actions, suits or proceedings, actual or threatened, in connection with the management of the business of the Company. 17. GOVERNING LAW. This Agreement shall be governed by, and construed under, the laws of the State of Delaware, all rights and remedies being governed by said laws. IN WITNESS WHEREOF, the undersigned, intending to be legally bound hereby, has duly executed this Operating Agreement. QUOIN, LLC, the Company By: /s/ Desiree DeStefano ----------------------- Name: Desiree DeStefano Title: Vice President JARDEN CORPORATION, Member By: /s/ Desiree DeStefano ----------------------- Name: Desiree DeStefano Title: Senior Vice President SCHEDULE A
- --------------------- ---------------------------------- ------------------------------------------- NAME CAPITAL CONTRIBUTION ALLOCATION OF PROFITS AND LOSSES - --------------------- ---------------------------------- ------------------------------------------- Jarden Corporation $70,940,405 100% - --------------------- ---------------------------------- -------------------------------------------
EX-3.3 6 file005.txt CERTIFICATE OF FORMATION OF HEARTHMARK, LLC CERTIFICATE OF FORMATION OF HEARTHMARK, LLC ------------------- The undersigned, an authorized natural person, for the purpose of forming a limited liability company, under the provisions and subject to the requirements of the State of Delaware (particularly Chapter 18, Title 6 of the Delaware Code and the acts amendatory thereof and supplemental thereto, and known, identified, and referred to as the "Delaware Limited Liability Company Act"), hereby certifies that: FIRST: The name of the limited liability company (hereinafter called the "Limited Liability Company") is HEARTHMARK, LLC. SECOND: The address of the registered office and the name and the address of the registered agent of the Limited Liability Company required to be maintained by Section 18-104 of the Delaware Limited Liability Company Act are: Corporation Service Company 2711 Centerville Road, Suite 400 Wilmington, Delaware 19808 THIRD: The Limited Liability Company shall, to the fullest extent permitted by the provisions of the Delaware Limited Liability Company Act, as the same may be amended and supplemented, indemnify the members, managers, officers and directors of the Limited Liability Company. Dated: September 19, 2003 /s/ Mitchell D. Hollander ------------------------- Mitchell D. Hollander Authorized Person EX-3.4 7 file006.txt OPERATING AGREEMENT OF HEARTHMARK, LLC OPERATING AGREEMENT OF HEARTHMARK, LLC This Operating Agreement (this "Agreement") of HEARTHMARK, LLC, a Delaware limited liability company (the "Company"), is entered into as of the 18th day of September, 2003 by and between Quoin, LLC (the "Member") and the Company. Pursuant to and in accordance with the Limited Liability Company Act of the State of Delaware, as amended from time to time (the "LLCA"), the Member and the Company hereby agree as follows: 1. NAME. The name of the limited liability company shall be HEARTHMARK, LLC. 2. OFFICE. The principal office of the Company shall be located at 555 Theodore Fremd Avenue, Rye, New York 10580 or such other place or places as the Member shall determine. 3. TERM. The term of the Company commenced as of the date of filing of the Certificate of Formation of the Company with the Secretary of State of the State of Delaware and the Company shall be dissolved and its affairs wound up as provided in said Certificate, in this Agreement, or as otherwise provided in the LLCA. 4. PURPOSE. The Company is formed for the purpose of engaging in any lawful act or activity for which limited liability companies may be organized under the LLCA and engaging in any and all activities necessary or incidental to the foregoing. 5. MEMBER. The name and the mailing address of the Member is as follows: Name Address Quoin, LLC 555 Theodore Fremd Avenue Rye, NY 10580 The Member is authorized to admit additional members and/or create different classes of members. 6. MANAGEMENT; POWERS. The business and affairs of the Company shall be managed by the Member. The Member is authorized to execute any and all documents on behalf of the Company necessary or appropriate in connection with the acquisition, financing, operation, management or development of any property of the Company. The Member may appoint one or more officers who shall be authorized to exercise such of the Member's rights and power as designated by the Member. 7. ACTION BY WRITTEN CONSENT. Whenever the Member is required or permitted to take any action by vote or consent, action may be taken without a meeting, without prior notice and without a vote, if written consent or consents setting forth the action taken are signed by the Member or any officers appointed by the Member, and are delivered to the office of the Company, its principal place of business, or an employee or agent of the Company. 8. CAPITAL CONTRIBUTIONS. The initial capitalization of the Company by the Member is set forth on Schedule A. 9. ADDITIONAL CONTRIBUTIONS. The Member is not required to make any additional capital contribution to the Company, provided however, that additional capital contributions may be made at such time and in such amounts as the Member shall determine. 10. MEMBER LOANS. If, at any time, additional funds are needed by the Company beyond the capital contributed by the Member, the Member may from time to time make voluntary loans to the Company. 11. ALLOCATION OF PROFITS AND LOSSES. The Company's profits and losses shall be allocated to the Member as set forth on Schedule A. 12. DISTRIBUTIONS. Distributions shall be made to the Member at the times and in the aggregate amounts determined by the Member and in accordance with the same percentages as profits and losses are allocated. 13. ADMISSION OF ADDITIONAL MEMBERS. The Member may cause the Company to admit one or more additional members to the Company. 14. LIABILITY OF MEMBERS. The Member shall not have any liability for the obligations or liabilities of the Company. 15. EXCULPATION OF MEMBER. The Member shall not be liable to the Company for any breach of duty in such capacity, unless otherwise required by law. 16. INDEMNIFICATION. The Company shall indemnify and hold harmless the Member, and all members, officers, representatives and other agents of the Member, to the fullest extent permitted by law from and against any and all losses, claims, damages, liabilities, expenses (including legal and other professional fees and disbursements), judgments, fines, settlements and other amounts (collectively, the "Indemnification Obligations") arising from any and all claims, demands, actions, suits or proceedings, actual or threatened, in connection with the management of the business of the Company. 17. GOVERNING LAW. This Agreement shall be governed by, and construed under, the laws of the State of Delaware, all rights and remedies being governed by said laws. IN WITNESS WHEREOF, the undersigned, intending to be legally bound hereby, has duly executed this Operating Agreement. HEARTHMARK, LLC, the Company By: /s/ Desiree DeStefano ----------------------- Name: Desiree DeStefano Title: Vice President QUOIN, LLC, Member By: /s/ Desiree DeStefano ----------------------- Name: Desiree DeStefano Title: Vice President SCHEDULE A
- ------------------ ---------------------------------- ------------------------------------------- NAME CAPITAL CONTRIBUTION ALLOCATION OF PROFITS AND LOSSES - ------------------ ---------------------------------- ------------------------------------------- Quoin, LLC $21,248,543 100% - ------------------ ---------------------------------- -------------------------------------------
EX-3.5 8 file007.txt CERTIFICATE OF INCORPORATION OF O.W.D., INC. ****************************************************************************** CERTIFICATE OF INCORPORATION of O.W.D., INCORPORATED UNDER SECTION 402 OF THE BUSINESS CORPORATION LAW ****************************************************************************** THE UNDERSIGNED, being of the age of twenty-one (21) years or over, under Section 402 of the New York Business Corporation Law, does hereby set forth: 1. The name of the corporation is: O.W.D. INCORPORATED. 2. The purpose or purposes for which it is formed are: To manufacture for sale or to purchase for sale and to sell at wholesale or retail all types of woodenware products including but not restricted to spoons, forks, ice cream sticks, tongue depressors, applicators, surgical supplies, coffee stirrers, toothpicks, clothespins and meat skewers. To manufacture for sale or to purchase for sale all types of paper products including but not restricted to cups, tissues, napkins, plates, containers and boxes. To manufacture for sale or to purchase for sale at wholesale or retail plastic merchandise including but not restricted to spoons, forks, knives, cups, bowls and plates. To manufacture for sale or to purchase for sale at wholesale or retail each and every sort of item in any ways related to the woodenware, plastic or paper business. To acquire or dispose of by lease or purchase all real estate and equipment necessary to carry out the above objectives. The foregoing clauses shall be construed both as objects and powers, and it is hereby expressly provided that the enumeration herein of said specific objects and powers shall not be held to limit or restrict in any manner the general and implied powers of this corporation. 3. The office of the corporation is to be located in the incorporated Village of Tupper Lake, County of Franklin and State of New York. 4. The aggregate number of shares which the corporation shall have the authority to issue is One thousand (1,000) shares of the par value of One hundred dollars ($100.00) each for a total capital stock of One hundred thousand dollars ($100,000.00) which shares are to be divided into the following classes: Two hundred fifty (250) shares with a par value of One hundred dollar ($100.00) each shall be preferred stock and seven hundred fifty (750) shares with a par value of One hundred dollars ($100.00) each, shall be common stock. 5. The designation of each class and the relative rights, preferences and limitations of the shares of each class are as follows: The holders of the preferred stock shall be entitled to have declared and set apart for their benefit, annually out of surplus profits, a cumulative dividend of six percent per annum from the date of issue of their shares, before any dividend shall be declared on the common stock, but the holders of the preferred stock shall not be entitled to any other or further participation in profits; and upon liquidation of the affairs of the corporation and distribution of its assets, either by dissolution or otherwise, the holders of the preferred stock shall be entitled to receive payment in full of the par value of their shares, with accumulated dividends, before any payment shall be made on account of the common stock. Preferred stock shall not confer upon the holders thereof any right or privilege of voting for the election of directors, or upon the adoption, amendment or repeal of by-laws. The holders of the common shares have voting rights on the basis of one (1) vote for each share of stock held by them. The holders of the common stock are entitled to receive in each year all surplus net profits to the extent of the dividends which may be declared by the Board of Directors on the common stock after the payment of any dividends or accumulated dividends at the rates above provided on the issue of the preferred stock. 6. The Secretary of State is designated as the agent of the corporation upon whom process against it may be served. The post office address to which the Secretary of State shall mail a copy of any process against the corporation served upon him is 34 Park Street, Tupper Lake, New York. 7. The duration of the corporation shall be perpetual. Dated: August 25, 1964 /s/ Robert J. Sullivan ------------------------------------ Robert J. Sullivan Address: (no number) Racquette River Drive Tupper Lake, New York STATE OF NEW YORK ) ss.: COUNTY OF FRANKLIN ) On this 25th day of August, 1964 before me, the subscriber, personally appeared ROGER J. SULLIVAN to me personally known and known to me to be the same person described in and who executed the within Certificate of Incorporation and he duly acknowledged to me that he executed the same /s/ ------------------------------------ EX-3.6 9 file008.txt BY-LAWS OF O.W.D., INCORPORATED BY-LAWS OF O.W. D., INCORPORATED ARTICLE I - OFFICES The principal office of the corporation shall be in the Village of Tupper Lake County of Franklin State of New York. The corporation may also have offices at such other places within or without the State of New York as the board may from time to time determine or the business of the corporation may require. ARTICLE II - SHAREHOLDERS 1. PLACE OF MEETINGS. Meetings of shareholders shall be held at the principal office of the corporation or at such place within or without the State of New York, as the board shall authorize. 2. ANNUAL MEETING. The annual meeting of the shareholders shall be held on the 1st day of September at 11:00 a.m. in each year if not a legal holiday, and, if a legal holiday, then on the next business day following at the same hour, when the shareholders shall elect a board and transact such other business as may properly come before the meeting. 3. SPECIAL MEETINGS. Special meetings of the shareholders may be called by the board or by the president and shall be called by the president or the secretary at the request in writing of a majority of the board or at the request in writing by shareholders owning a majority in amount of the shares issued and outstanding. Such request shall state the purpose or purposes of the proposed meeting. Business transacted at a special meeting shall be confined to the purposes stated in the notice. 4. FIXING RECORD DATE. For the purpose of determining the shareholders entitled to notice of or to vote at any meeting of shareholders or any adjournment thereof, or to express consent to or dissent from any proposal without a meeting, or for the purpose of determining shareholders entitled to receive payment of any dividend or the allotment of any rights, or for the purpose of any other action, the board shall fix, in advance, a date as the record date for any such determination of shareholders. Such date shall not be more than fifty nor less than ten days before the date of such meeting, nor more than fifty days prior to any other action. If no record date is fixed it shall be determined in accordance with the provisions of law. 5. NOTICE OF MEETINGS OF SHAREHOLDERS. Written notice of each meeting of shareholders shall state the purpose or purposes for which the meeting is called, the place, date and hour of the meeting and unless it is the annual meeting, shall indicate that it is being issued by or at the direction of the person or persons calling the meeting. Notice shall be given either personally or by mail to each shareholder entitled to vote at such meeting, not less than ten nor more than fifty days before the date of the meeting. If action is proposed to be taken that might entitle shareholders to payment for their shares, the notice shall include a statement of that purpose and to that effect. If mailed, the notice is given when deposited in the United States mail, with postage thereon prepaid, directed to the shareholder at his address as it appears on the record of shareholders, or, if he shall have filed with the Secretary a written request that notices to him be mailed to some other address, then directed to him at such other address. 6. WAIVERS. Notice of meeting need not be given to any shareholder who signs a waiver of notice, in person or by proxy, whether before or after the meeting. The attendance of any shareholder at a meeting, in person or by proxy, without protesting prior to the conclusion of the meeting the lack of notice of such meeting, shall constitute a waiver of notice by him. 7. QUORUM OF SHAREHOLDERS. Unless the certificate of incorporation provides otherwise, the holders of a majority of the shares entitled to vote thereat shall constitute a quorum at a meeting of shareholders for the transaction of any business, provided that when a specified item of business is required to be voted on by a class or classes, the holders of a majority of the shares of such class or classes shall constitute a quorum for the transaction of such specified item of business. When a quorum is once present to organize a meeting, it is not broken by the subsequent withdrawal of any shareholders. The shareholders present may adjourn the meeting despite the absence of a quorum. 8. PROXIES. Every shareholder entitled to vote at a meeting of shareholders or to express consent or dissent without a meeting may authorize another person or persons to act for him by proxy. Every proxy must be signed by the shareholder or his attorney-in-fact. No proxy shall be valid after expiration of eleven months from the date thereof unless otherwise provided in the proxy. Every proxy shall be revocable at the pleasure of the shareholder executing it, except as otherwise provided by law. 9. QUALIFICATION OF VOTERS. Every shareholder of record shall be entitled at every meeting of shareholders to one vote for every share standing in his name on the record of shareholders, unless otherwise provided in the certificate of incorporation. 10. VOTE OF SHAREHOLDERS. Except as otherwise required by statute or by the certificate of incorporation; (a) directors shall be elected by a plurality of the votes cast at a meeting of shareholders by the holders of shares entitled to vote in the election; (b) all other corporate action shall be authorized by a majority of the votes cast. 11. WRITTEN CONSENT OF SHAREHOLDERS. Any action that may be taken by vote may be taken without a meeting on written consent, setting forth the action so taken, signed by the holders of all the outstanding shares entitled to vote thereon or signed by such lesser number of holders as may be provided for in the certificate of incorporation. ARTICLE III - DIRECTORS 1. BOARD OF DIRECTORS. Subject to any provision in the certificate of incorporation the business of the corporation shall be managed by its board of directors, each of whom shall be at least 21 years of age and need not be shareholders. 2. NUMBER OF DIRECTORS. The number of directors shall be four. When all of the shares are owned by less than three shareholders, the number of directors may be less than three but not less than the number of shareholders. 3. ELECTION AND TERM OF DIRECTORS. At each annual meeting of shareholders, the shareholders shall elect directors to hold office until the next annual meeting. Each director shall hold office until the expiration of the term for which he is elected and until his successor has been elected and qualified, or until his prior resignation or removal. 4. NEWLY CREATED DIRECTORSHIPS AND VACANCIES. Newly created directorships resulting from an increase in the number of directors and vacancies occurring in the board for any reason except the removal of directors without cause may be filled by a vote of a majority of the directors then in office, although less than a quorum exists, unless otherwise provided in the certificate of incorporation. Vacancies occurring by reason of the removal of directors without cause shall be filled by vote of the shareholders unless otherwise provided in the certificate of incorporation. A director elected to fill a vacancy caused by resignation, death or removal shall be elected to hold office for the unexpired term of his predecessor. 5. REMOVAL OF DIRECTORS. Any or all of the directors may be removed for cause by vote of the shareholders or by action of the board. Directors may be removed without cause only by vote of the shareholders. 6. RESIGNATION. A director may resign at any time by giving written notice to the board, the president or the secretary of the corporation. Unless otherwise specified in the notice, the resignation shall take effect upon receipt thereof by the board or such officer, and the acceptance of the resignation shall not be necessary to make it effective. 7. QUORUM OF DIRECTORS. Unless otherwise provided in the certificate of incorporation, a majority of the entire board shall constitute a quorum for the transaction of business or of any specified item of business. 8. ACTION OF THE BOARD. Unless otherwise required by law, the vote of a majority of the directors present at the time of the vote, if a quorum is present at such time, shall be the act of the board. Each director present shall have one vote regardless of the number of shares, if any, which he may hold. 9. PLACE AND TIME OF BOARD MEETINGS. The board may hold its meetings at the office of the corporation or at such other places, either within or without the State of New York, as it may from time to time determine. 10. REGULAR ANNUAL MEETING. A regular annual meeting of the board shall be held immediately following the annual meeting of shareholders at the place of such annual meeting of shareholders. 11. NOTICE OF MEETINGS OF THE BOARD, ADJOURNMENT. (a) Regular meetings of the board may be held without notice at such time and place as it shall from time to time determine. Special meetings of the board shall be held upon notice to the directors and may be called by the president upon three days notice to each director either personally or by mail or by wire; special meetings shall be called by the president or by the secretary in a like manner on written request of two directors. Notice of a meeting need not be given to any director who submits a waiver of notice whether before or after the meeting or who attends the meeting without protesting prior thereto or at its commencement, the lack of notice to him. (b) A majority of the directors present, whether or not a quorum is present, may adjourn any meeting to another time and place. Notice of the adjournment shall be given all directors who were absent at the time of the adjournment and, unless such time and place are announced at the meeting, to the other directors. 12. CHAIRMAN. At all meetings of the board the president, or in his absence, a chairman chosen by the board shall preside. 13. EXECUTIVE AND OTHER COMMITTEES. The board, by resolution adopted by a majority of the entire board, may designate from among its members an executive committee and other committees, each consisting of three or more directors. Each such committee shall serve at the pleasure of the board. 14. COMPENSATION. No compensation shall be paid to directors, as such, for their services, but by resolution of the board a fixed sum and expenses for actual attendance, at each regular or special meeting of the board may be authorized. Nothing herein contained shall be construed to preclude any director from serving the corporation in any other capacity and receiving compensation therefor. ARTICLE IV - OFFICERS 1. OFFICES, ELECTION, TERM. (a) Unless otherwise provided for in the certificate of incorporation, the board may elect or appoint a president, one or more vice-presidents, a secretary and a treasurer, and such other officers as it may determine, who shall have such duties, powers and functions as hereinafter provided. (b) All officers shall be elected or appointed to hold office until the meeting of the board following the annual meeting of shareholders. (c) Each officer shall hold office for the term for which he is elected or appointed and until his successor has been elected or appointed and qualified. 2. REMOVAL, RESIGNATION, SALARY, ETC. (a) Any officer elected or appointed by the board may be removed by the board with or without cause. (b) In the event of the death, resignation or removal of an officer, the board in its discretion may elect or appoint a successor to fill the unexpired term. (c) Any two or more offices may be held by the same person, except the offices of president and secretary. (d) The salaries of all officers shall be fixed by the board. (e) The directors may require any officer to give security for the faithful performance of his duties. 3. PRESIDENT. The president shall be the chief executive officer of the corporation; he shall preside at all meetings of the shareholders and of the board; he shall have the management of the business of the corporation and shall see that all orders and resolutions of the board are carried into effect. 4. VICE- PRESIDENTS. During the absence or disability of the president, the vice-president, or if there are more than one, the executive vice-president, shall have all the powers and functions of the president. Each vice-president shall perform such other duties as the board shall prescribe. 5. SECRETARY. The secretary shall: (a) attend all meetings of the board and of the shareholders; (b) record all votes and minutes of all proceedings in a book to be kept for that purpose; (c) give or cause to be given notice of all meetings of shareholders and of special meetings of the board; (d) keep in safe custody the seal of the corporation and affix it to any instrument when authorized by the board; (e) when required, prepare or cause to be prepared and available at each meeting of shareholders a certified list in alphabetical order of the names of shareholders entitled to vote thereat, indicating the number of shares of each respective class held by each; (f) keep all the documents and records of the corporation as required by law or otherwise in a proper and safe manner. (g) perform such other duties as may be prescribed by the board. 6. ASSISTANT- SECRETARIES. During the absence or disability of the secretary, the assistant-secretary, or if there are more than one, the one so designated by the secretary or by the board, shall have all the powers and functions of the secretary. 7. TREASURER. The treasurer shall: (a) have the custody of the corporate funds and securities; (b) keep full and accurate accounts of receipts and disbursements in the corporate books; (c) deposit all money and other valuables in the name and to the credit of the corporation in such depositories as may be designated by the board; (d) disburse the funds of the corporation as may be ordered or authorized by the board and preserve proper vouchers for such disbursements; (e) render to the president and board at the regular meetings of the board, or whenever they require it, an account of all his transactions as treasurer and of the financial condition of the corporation; (f) render a full financial report at the annual meeting of the shareholders if so requested; (g) be furnished by all corporate officers and agents at his request, with such reports and statements as he may require as to all financial transactions of the corporation; (h) perform such other duties as are given to him by these by-laws or as from time to time are assigned to him by the board or the president. 8. ASSISTANT-TREASURER. During the absence or disability of the treasurer, the assistant-treasurer or if there are more than one, the one so designated by the secretary or by the board, shall have all the powers and functions of the treasurer. 9. SURETIES AND BONDS. In case the board shall so require, any officer or agent of the corporation shall execute to the corporation a bond in such sum and with such surety or sureties as the board may direct, conditioned upon the faithful performance of his duties to the corporation and including responsibility for negligence and for the accounting for all property, funds or securities of the corporation which may come into his hands. ARTICLE V - CERTIFICATES FOR SHARES 1. CERTIFICATES. The shares of the corporation shall be represented by certificates. They shall be numbered and entered in the books of the corporation as they are issued. They shall exhibit the holder's name and the number of shares and shall be signed by the president or a vice-president and the treasurer or the secretary and shall bear the corporate seal. 2. LOST OR DESTROYED CERTIFICATES. The board may direct a new certificate or certificates to be issued in place of any certificate or certificates theretofore issued by the corporation, alleged to have been lost or destroyed, upon the making of an affidavit of that fact by the person claiming the certificate to be lost or destroyed. When authorizing such issue of a new certificate or certificates, the board may, in its discretion and as a condition precedent to the issuance thereof, require the owner of such lost or destroyed certificate or certificates, or his legal representative, to advertise the same in such manner as it shall require and/or give the corporation a bond in such sum and with such surety or sureties as it may direct as indemnity against any claim that may be made against the corporation with respect to the certificate alleged to have been lost or destroyed. 3. TRANSFERS OF SHARES. (a) Upon surrender to the corporation or the transfer agent of the corporation of a certificate for shares duly endorsed or accompanied by proper evidence of succession, assignment or authority to transfer, it shall be the duty of the corporation to issue a new certificate to the person entitled thereto, and cancel the old certificate; every such transfer shall be entered on the transfer book of the corporation which shall be kept at its principal office. No transfer shall be made within ten days next preceding the annual meeting of shareholders. (b) The corporation shall be entitled to treat the holder of record of any share as the holder in fact thereof and, accordingly, shall not be bound to recognize any equitable or other claim to or interest in such share on the part of any other person whether or not it shall have express or other notice thereof, except as expressly provided by the laws of New York. 4. CLOSING TRANSFER BOOKS. The board shall have the power to close the share transfer books of the corporation for a period of not more than ten days during the thirty day period immediately preceding (1) any shareholders' meeting, or (2) any date upon which shareholders shall be called upon to or have a right to take action without a meeting, or (3) any date fixed for the payment of a dividend or any other form of distribution, and only those shareholders of record at the time the transfer books are closed, shall be recognized as such for the purpose of (i) receiving notice of or voting at such meeting, or (2) allowing them to take appropriate action, or (3) entitling them to receive any dividend or other form of distribution. ARTICLE VI - DIVIDENDS Subject to the provisions of the certificate of incorporation and to applicable law, dividends on the outstanding shares of the corporation may be declared in such amounts and at such time or times as the board may determine. Before payment of any dividend, there may be set aside out of the net profits of the corporation available for dividends such sum or sums as the board from time to time in its absolute discretion deems proper as a reserve fund to meet contingencies, or for equalizing dividends, or for repairing or maintaining any property of the corporation, or for such other purpose as the board shall think conducive to the interests of the corporation, and the board may modify or abolish any such reserve. ARTICLE VII- CORPORATE SEAL The seal of the corporation shall be circular in form and bear the name of the corporation, the year of its organization and the words "Corporate Seal, New York." The seal may be used by causing it to be impressed directly on the instrument or writing to be sealed, or upon adhesive substance affixed thereto. The seal on the certificates for shares or on any corporate obligation for the payment of money may be a facsimile, engraved or printed. ARTICLE VIII - EXECUTION OF INSTRUMENTS All corporate instruments and documents shall be signed or countersigned, executed, verified or acknowledged by such officer or officers or other person or persons as the board may from time to time designate. ARTICLE IX - FISCAL YEAR The fiscal year shall begin the __________day of September in each year. ARTICLE X - REFERENCES TO CERTIFICATE OF INCORPORATION Reference to the certificate of incorporation in these by-laws shall include all amendments thereto or changes thereof unless specifically excepted. ARTICLE XI - BY-LAW CHANGES AMENDMENT, REPEAL, ADOPTION, ELECTION OF DIRECTORS. (a) Except as otherwise provided in the certificate of incorporation the by-laws may be amended, repealed or adopted by vote of the holders of the shares at the time entitled to vote in the election of any directors. By-laws may also be amended, repealed or adopted by the board but any by-law adopted by the board may be amended by the shareholders entitled to vote thereon as hereinabove provided. (b) If any by-law regulating an impending election of directors is adopted, amended or repealed by the board, there shall be set forth in the notice of the next meeting of shareholders for the election of directors the by-law so adopted, amended or repealed, together with a concise statement of the changes made. EX-3.7 10 file009.txt CERTIFICATE OF INCORPORATION OF T.L.P., INC. CERTIFICATE OF INCORPORATION OF TUPPER LAKE PLASTICS, INCORPORATED Under Section 402 of the Business Corporation Law The undersigned, a natural person of the age of eighteen years or over, desiring to form a corporation pursuant to the provisions of the Business Corporation Law of the State of New York, hereby certifies as follows: FIRST: The name of the corporation is TUPPER LAKE PLASTICS, INCORPORATED Hereinafter sometimes called "the corporation." SECOND: The purpose of which it is formed is as follows: The purpose for which this corporation is organized is to engage in any lawful act or activity for which corporations may be formed under the Business Corporation Law provided that the corporation is not formed to engage in any act or activity which requires the consent or approval of any state official, department, board, agency or other body, without such consent or approval first being obtained. For the accomplishment of the aforesaid purposes, and in furtherance thereof, the corporation shall have and may exercise all of the powers conferred by the Business Corporation Law upon corporations formed thereunder, subject to any limitations contained in Article 2 of said law or in accordance with the provisions of any other statute of the State of New York. THIRD: The office of the corporation in the State of New York is to be located in the County of Franklin. FOURTH: The aggregate number of shares which the corporation shall have the authority to issue is 1,000 shares at no par value. FIFTH: The Secretary of State is designated as the agent of the corporation upon whom process against the corporation may be served, and the address to which the Secretary of State shall mail a copy of any process against the corporation served upon him is 110 Demars Boulevard, Tupper Lake, New York 12986. IN WITNESS WHEREOF, I hereunto sign my name and affirm that statements made herein are true under the penalties of perjury this 30th day of August 1989. Incorporator: S/Linda Pellitier ----------------- Address: Linda Pellitier 283 Washington Avenue Albany, New York 12206 2 EX-3.8 11 file010.txt BYLAWS OF TUPPER LAKE PLASTICS, INCORPORATED BYLAWS OF Tupperlake Plastics, Incorporated ARTICLE I. SHAREHOLDERS' MEETING SECTION 1. ANNUAL MEETING. The annual meeting of the shareholders shall be held within five months after the close of the fiscal year of the Corporation, for the purpose of electing directors, and transacting such other business as may properly come before the meeting. SECTION 2. SPECIAL MEETINGS. Special meetings of the shareholders may be called at any time by the Board of Directors or by the President or the Secretary at the written request of the holders of fifty per cent (50%) of the shares then outstanding and entitled to vote thereat, or as otherwise required under the provisions of the Business Corporation Law. SECTION 3. PLACE OF MEETINGS. All meetings of shareholders shall be held at the principal office of the Corporation, or at such other places within or without the State of New York as shall be designated in the notices or waivers of notice of such meetings. SECTION 4. NOTICE OF MEETINGS. (a) Written notice of each meeting of shareholders, whether annual or special, stating the time when and place where it is to be held, shall be served either personally or by mail, not less than ten or more than fifty days before the meeting, upon each shareholder of record entitled to vote at such meeting, and to any other shareholder to whom the giving of notice may be required by law. Notice of a special meeting shall also state the purpose or purposes for which the meeting is called, and shall indicate that it is being issued by, or at the direction of, the person or persons calling the meeting. If, at any meeting, action is proposed to be taken that would, if taken, entitle shareholders to receive payment for their shares pursuant to the Business Corporation Law, the notice of such meeting shall include a statement of that purpose and to that effect. If mailed, such notice shall be directed to each such shareholder at his address, as it appears on the records of the shareholders of the Corporation, unless he shall have previously filed with the Secretary of the Corporation a written request that notices intended for him be mailed to some other address, in which case, it shall be mailed to the address designated in such request. (b) Notice of any meeting need not be given to any person who may become a shareholder of record after the mailing of such notice and prior to the meeting, or to any shareholder who attends such meeting, in person or by proxy, or to any shareholder who, in person or by proxy, submits a signed waiver of notice either before or after such meeting. Notice of any adjourned meeting of shareholders need not be given, unless otherwise required by statute. SECTION 5. QUORUM. (a) Except as otherwise provided herein, or by statute, or in the Certificate of Incorporation (such Certificate and any amendments thereof being hereinafter collectively referred to as the "Certificate of Incorporation"), at all meetings of shareholders of the Corporation, the presence at the commencement of such meetings in person or by proxy of shareholders holding of record a majority of the total number of shares of the Corporation then issued and outstanding and entitled to vote, shall be necessary and sufficient to constitute a quorum for the transaction of any business. The withdrawal of any shareholder after the commencement of a meeting shall have no effect on the existence of a quorum, after a quorum has been established at such meeting. (b) Despite the absence of a quorum at any annual or special meeting of shareholders, the shareholders, by a majority of the votes cast by the holders of shares entitled to vote thereon, may adjourn the meeting. At any such adjourned meeting at which a quorum is present, any business may be transacted which might have been transacted at the meeting as originally called if a quorum had been present. SECTION 6. VOTING. (a) Except as otherwise provided by statute or by the Certificate of Incorporation, any corporate action, other than the election of directors to be taken by vote of the shareholders, shall be authorized by a majority of votes cast at a meeting of shareholders, shall be authorized by a majority of votes cast at a meeting of shareholders by the holders of shares entitled to vote thereon. (b) Except as otherwise provided by statute or by the Certificate of Incorporation, at each meeting of shareholders, each holder of record of stock of the Corporation entitled to vote thereat, shall be entitled to one vote for each share of stock registered in his name on the books of the Corporation. (c) Each shareholder entitled to vote or to express consent or dissent without a meeting, may do so by proxy; provided, however, that the instrument authorizing such proxy to act shall have been executed in writing by the shareholder himself, or by his attorney-in-fact thereunto duly authorized in writing. No proxy shall be valid after the expiration of eleven months from the date of its execution, unless the persons executing it shall have specified therein the length of time it is to continue in force. Such instrument shall be exhibited to the Secretary at the meeting and shall be filed with the records of the Corporation. (d) Any resolutions in writing, signed by all of the shareholders entitled to vote thereon, shall be and constitute action by such shareholders to the effect therein expressed, with the same force and effect as if the same had been duly passed by unanimous vote at a duly called meeting of shareholders and such resolution so signed shall be inserted in the Minute Book of the Corporation under its proper date. 2 ARTICLE II. DIRECTORS SECTION 1. NUMBER. The affairs and the business of the Corporation, except as otherwise provided in the Certificate of Incorporation, shall be managed by the Board of Directors. The number of the directors of the Corporation shall be four (4), unless and until otherwise determined by vote of a majority of the entire Board of Directors. The number of Directors shall not be less than three, unless all of the outstanding shares are owned beneficially and of record by less than three shareholders, in which event the number of directors shall not be less than the number of shareholders. SECTION 2. HOW ELECTED. At the annual meeting of shareholders, the persons duly elected by the votes cast at the election held threat shall become the directors for the ensuing year. SECTION 3. TERM OF OFFICE. The term of office of each of the directors shall be until the next annual meeting of shareholders and thereafter until a successor has been elected and qualified. SECTION 4. DUTIES OF DIRECTORS. The Board of Directors shall have the control and general management of the affairs and business of the Corporation unless otherwise provided in the certificate of Incorporation. Such directors shall in all cases act as a Board regularly convened by a majority, and they may adopt such rules and regulations for the conduct of their meetings, and the management and business of the Corporation as they may deem proper, not inconsistent with these By-Laws and the Laws of the State of New York. SECTION 5. DIRECTORS' MEETINGS. Regular meetings of the Board of Directors shall be held immediately following the annual meetings of the shareholders, and at such other times as the Board of Directors may determine. Special meetings of the Board of Directors may be called by the President at any time and must be called by the President or the Secretary upon the written request of two Directors. SECTION 6. NOTICE OF SPECIAL MEETINGS. Notice of special meetings of the Board of Directors shall be served personally or by mail addressed to each Director at his last known address no less than five or more than twenty days prior to the date of such meeting. The notice of such meeting shall contain a statement of the business to be transacted thereat. No business other than that specified in the call for the meeting shall be transacted at any special meeting. Notice of special meeting may be waived by any Director by written waiver or by personal attendance thereat without protest of lack of notice to him. 3 SECTION 7. QUORUM. At any meeting of the Board of Directors, except as otherwise provided by the Certificate of Incorporation, or by these By-Laws, a majority of the Board of Directors shall constitute a quorum. However, a lesser number when not constituting a quorum may adjourn the meeting from time to time until a quorum shall be present or represented. SECTION 8. VOTING. Except as otherwise provided by statute, or by the Certificate of Incorporation, or by these By-Laws, the affirmative vote of a majority of the Directors present at any meeting of the Board of Directors at which a quorum is present shall be necessary for the transaction of any item of business thereat. Any resolution in writing, signed by all of the directors entitled to vote thereon, shall be and constitute action by such directors to the effect therein expressed, with the same force and effect as if the same had been duly passed by unanimous vote at a duly called meeting of directors and such resolution so signed shall be inserted in the Minute Book of the Corporation under its proper date. SECTION 9. VACANCIES. Unless otherwise provided in the Certificate of Incorporation, vacancies in the Board of Directors occurring between annual meetings of the shareholders shall be filled for the unexpired portion of the term by a majority vote of the remaining Directors, even though less than a quorum exists. SECTION 10. REMOVAL OF DIRECTORS. Any or all of the directors may be removed, either with or without cause at any time by a vote of the shareholders at any meeting called for such purpose. SECTION 11. RESIGNATION. Any director may resign at any time by giving written notice to the Board of Directors, the President or the Secretary of the Corporation. Unless otherwise specified in such written notice, such resignation shall take effect upon receipt thereof by the Board of Directors or such officer, and the acceptance of such resignation shall not be necessary to make it effective. SECTION 12. SALARY. No stated salary shall be paid to directors, as such, for their services, but by resolution of the Board of Directors a fixed sum and expenses of attendance, if any, may be allowed for attendance at each regular or special meeting of the Board; provided, however, that nothing herein contained shall be construed to preclude any director from serving the Corporation in any other capacity and receiving compensation thereof. 4 SECTION 13. CONTRACTS. (a) No contract or other transaction between this Corporation and any other Corporation shall be impaired, affected or invalidated, nor shall any director be liable in any way by reason of the fact that any one or more of the directors of this Corporation is or are interested in, or is a director or officer, or are directors or officers of such other Corporation, provided that such facts are disclosed or made known to the Board of Directors. (b) Any director, personally and individually, may be interested in any contract or transaction of this Corporation, and no director shall be liable in any way by reason of such interest, provided that the fact of such interest be disclosed or made known to the Board of Directors, and provided that the Board of Directors shall authorize, approve or ratify such contract or transaction by the vote (not counting the vote of any such director) of a majority of a quorum, notwithstanding the presence of any such director at the meeting at which such action is taken. Such director or directors may be counted in determining the presence of a quorum at such meeting. This Section shall not be construed to impair or invalidate or in any way affect any contract or other transaction which would otherwise be valid under the law (common, statutory or otherwise) applicable thereto. SECTION 14. COMMITTEES. The Board of Directors, by resolution adopted by a majority of the entire Board, may from time to time designate from among its members an executive committee and such other committees, and alternate members thereof, as they deem desirable, each consisting of three or more members, with such powers and authority (to the extent permitted by law) as may be provided in such resolution. Each such committee shall serve at the pleasure of the Board. ARTICLE III. OFFICERS SECTION 1. NUMBER OF OFFICERS. (a) The officers of the Corporation shall consist of a President, a Secretary, a Treasurer, and such other officers, including a Chairman of the Board of Directors, and one or more Vice Presidents, as the Board of Directors may from time to time deem advisable. Any officer other than the Chairman of the Board of Directors may be, but is not required to be, a director of the Corporation. Any officer may hold more than one office except the same person may not hold the office of President and Secretary. SECTION 2. ELECTION OF OFFICERS. Officers of the Corporation shall be elected at the first meeting of the Board of Directors. Thereafter, and unless otherwise provided in the Certificate of Incorporation, the officers of the Corporation shall be elected annually by the Board of Directors at its meeting held immediately after the annual meeting of shareholders and shall hold office for one year until their successor have been duly elected and qualified. 5 SECTION 3. REMOVAL OF OFFICERS. Any other officer elected by the Board of Directors may be removed, with or without cause, and a successor elected, by vote of the Board of Directors, regularly convened at a regular or special meeting. Any officer elected by the shareholders may be removed, with or without cause, and a successor elected, by vote of the shareholders, regularly convened at an annual or special meeting. SECTION 4. PRESIDENT. The President shall be the chief executive officer of the Corporation and shall have general charge of the business, affairs and property thereof, subject to direction of the Board of Directors, and shall have general supervision over its officers and agents. He shall, if present, preside at all meetings of the Board of Directors in the absence of a Chairman of the Board and at all meetings of shareholders. He may do and perform all acts incident to the office of President. SECTION 5. VICE-PRESIDENT. In the absence of or inability of the President to act, the Vice-President shall perform the duties and exercise the powers of the President and shall perform such other functions as the Board of Directors may from time to time prescribe. SECTION 6. SECRETARY. The Secretary shall: (a) Keep the minutes of the meetings of the Board of Directors and of the shareholders in appropriate books. (b) Give and serve all notice of all meetings of the Corporation. (c) Be custodian of the records and of the seal of the Corporation and affix the latter to such instruments or documents as may be authorized by the Board of Directors. (d) Keep the shareholder records in such a manner as to show at any time the amount of shares, the manner and the time the same was paid for, the names of the owners thereof alphabetically arranged and their respective places of residence, or their Post Office addresses, the number of shares owned by each of them and the time at which each person became owner, and keep such shareholder records available daily during the usual business hours at the office of the Corporation subject tot he inspection of any person duly authorized, as prescribed by law. (e) Do and perform all other duties incident to the office of Secretary. 6 SECTION 7. TREASURER. The Treasurer shall: (a) Have the care and custody of and be responsible for all of the funds and securities of the Corporation and deposit of such funds in the name and to the credit of the Corporation in such a bank and safe deposit vaults as the Directors may designate. (b) Exhibit at all reasonable times his books and accounts to any Director or shareholder of the Corporation upon application at the office of the Corporation during business hours. (c) Render a statement of the condition of the finances of the Corporation at each stated meeting of the Board of Directors if called upon to do so, and a full report at the annual meeting of shareholders. He shall keep at the office of the Corporation correct books of account of all of its business and transactions and such books of account as the Board of Directors may require. He shall do so and perform all other duties incident to the office of Treasurer. SECTION 8. DUTIES OF OFFICERS MAY BE DELEGATED. In the case of the absence of any officer of the Corporation, or for any reason the Board may deem sufficient, the Board may, except as otherwise provided by these By-Laws, delegate the powers or duty of such officers to any other officer or any Director for the time being, provided a majority of the entire Board concur therein. SECTION 9. VACANCIES - HOW FILLED. Should any vacancy in any office occur by death, resignation or otherwise, the same shall be filled, without undue delay, by the Board of Directors at its next regular meeting or at a special meeting called for that purpose, except as otherwise provided in the Certificate of Incorporation. SECTION 10. COMPENSATION OF OFFICERS. The officers shall receive such salary or compensation as may be fixed and determined by the Board of Directors, except as otherwise provided in the certificate of Incorporation. ARTICLE IV. CERTIFICATES REPRESENTING SHARES SECTION 1. ISSUE OF CERTIFICATES REPRESENTING SHARES. The President shall cause to be issued to each initial shareholder one or more certificates, under the seal of the Corporation, signed by the President (or Vice-President) and the Treasurer (or Secretary) certifying the number of shares owned by him in the Corporation. No more shares shall be issued by the President or any other officer after the initial issuance of the original 200 shares without the consent of the owners of at least 150 of the original 200 shares, 7 nor will any other class of stock be authorized or issued without the consent of the owners of 150 of the original 200 shares of stock. SECTION 2. LOST OR DESTROYED CERTIFICATES. The holder of any certificate representing shares of the Corporation shall immediately notify the corporation of any loss or destruction of the certificate representing the same. The Corporation may issue a new certificate in the place of any certificate theretofore issued by it, alleged to have been lost or destroyed. On production of such evidence of loss or destruction as the Board of Directors in its discretion may require, the Board of Directors may, in its discretion, require the owner of the lost or destroyed certificate, or his legal representatives, to give the Corporation a bond in such sum as the Board may direct, and with such surety or sureties as may be satisfactory to the Board, to indemnify the Corporation against any claims, loss, liability or damage it may suffer on account of the issuance of the new certificate. A new certificate may be issued without requiring any such evidence or bond when, in the judgment of the Board of Directors, it is proper so to do. SECTION 3. TRANSFERS OF SHARES. (a) Transfers of shares of the Corporation shall be made on the shares records of the Corporation only by the holder of record thereof, in person or by his duly authorized attorney, upon surrender for cancellation of the certificate or certificates representing such shares, with an assignment or power of transfer endorsed thereon or delivered therewith, duly executed, with such proof of the authenticity of the signature and of authority to transfer and of payment of transfer taxes as the Corporation or its agents may require. (b) The Corporation shall be entitled to treat the holder of record of any share or shares as the absolute owner thereof for all purposes and, accordingly, shall not be bound to recognize any legal, equitable or other claim to, or interest in, such share or shares on the part of any other person, whether or not it shall have express or other notice thereof, except as otherwise expressly provided by law. ARTICLE V. SEAL The seal of the Corporation shall be as follows: ARTICLE VI. DIVIDENDS OR OTHER DISTRIUBTIONS The Corporation, by vote of the Board of Directors, may declare and pay dividends or make other distributions in cash or its bonds or its property on its outstanding shares to the extent as provided and permitted by law, unless contrary to any restriction contained in the Certificate of Incorporation. 8 ARTICLE VII. NEGOTIABLE INSTRUMENTS All checks, notes or other negotiable instruments shall be signed on behalf of this Corporation by such of the officers, agents and employees as the Board of Directors may from time to time designate, except as otherwise provided in the certificate of Incorporation. ARTICLE VIII. FISCAL YEAR The fiscal year of the Corporation shall be determined by resolution of the Board of Directors. ARTICLE IX. AMENDMENTS SECTION 1. BY SHAREHOLDERS. All by-laws of the Corporation shall be subject to alteration or repeal, and new by-laws may be made, by a majority vote of the shareholders at the time entitled to vote in the election of directors. SECTION 2. BY DIRECTORS. The Board of Directors shall have power to make, adopt, alter, amend and repeal, from time to time, by-laws of the Corporation; provided, however, that the shareholders entitled to vote with respect thereto as in this Article IX above-provided may alter, amend or repeal by-laws made by the Board of Directors, except that the Board of Directors shall have no power to change the quorum for meetings of shareholders or of the Board of Directors, or to change any provisions of the by-laws with respect to the removal of directors or the filling of vacancies in the Board resulting from the removal by the shareholders. If any by-law regulating an impending election of directors is adopted, amended or repealed by the Board of Directors, there shall be set forth in the notice of the next meeting of shareholders for the election of directors, the by-law so adopted, amended or repealed, together with a concise statement of the changes made. ARTICLE X. OFFICES The offices of the Corporation shall be located in the City, County and State designated in the Certificate of Incorporation. The Corporation may also maintain offices at such other places within or without the United Sates as the Board of Directors may, from time to time, determine. 9 The undersigned Incorporator certifies that he has adopted the foregoing by-laws as the first by-laws of the Corporation, in accordance with the requirements of the Business Corporation Law. Dated: 9/1/89 ------ /s/ ----------------------------------------- Incorporator EX-3.9 12 file011.txt CERTIFICATE OF FORMATION OF X PROPERTIES, LLC CERTIFICATE OF FORMATION OF X PROPERTIES, LLC ------------------- The undersigned, an authorized natural person, for the purpose of forming a limited liability company, under the provisions and subject to the requirements of the State of Delaware (particularly Chapter 18, Title 6 of the Delaware Code and the acts amendatory thereof and supplemental thereto, and known, identified, and referred to as the "Delaware Limited Liability Company Act"), hereby certifies that: FIRST: The name of the limited liability company (hereinafter called the "Limited Liability Company") is X PROPERTIES, LLC. SECOND: The address of the registered office and the name and the address of the registered agent of the Limited Liability Company required to be maintained by Section 18-104 of the Delaware Limited Liability Company Act are: LexisNexis Document Solutions Inc. 30 Old Rudnick Lane Dover, DE 19901 THIRD: The Limited Liability Company shall, to the fullest extent permitted by the provisions of the Delaware Limited Liability Company Act, as the same may be amended and supplemented, indemnify the members, managers, officers and directors of the Limited Liability Company. Dated: January 17, 2003 /s/ Robert L. Lawrence -------------------------- Robert L. Lawrence Authorized Person EX-3.10 13 file012.txt OPERATING AGREEMENT OF X PROPERTIES OPERATING AGREEMENT OF X PROPERTIES, LLC This Operating Agreement (this "Agreement") of X PROPERTIES, LLC, a Delaware limited liability company (the "Company"), is entered into as of the 17th day of January, 2003 by and between Quoin Corporation, a Delaware corporation (the "Member"), and the Company. Pursuant to and in accordance with the Limited Liability Company Act of the State of Delaware, as amended from time to time (the "LLCA"), the Member hereby agrees as follows: 1. NAME. The name of the limited liability company shall be X PROPERTIES, LLC. 2. OFFICE. The principal office of the Company shall be located at 30 Old Rudnick Lane, Dover, DE 19901 or such other place or places as the Member shall determine. 3. TERM. The term of the Company commenced as of the date of filing of the Certificate of Formation of the Company with the Secretary of State of the State of Delaware and the Company shall be dissolved and its affairs wound up as provided in said Certificate, in this Agreement, or as otherwise provided in the LLCA. 4. PURPOSE. The Company is formed for the purpose of engaging in any lawful act or activity for which limited liability companies may be organized under the LLCA and engaging in any and all activities necessary or incidental to the foregoing. 5. MEMBER. The name and the mailing address of the Member is as follows: Name Address ---- ------- Quoin Corporation 555 Theodore Fremd Avenue Rye, NY 10580 The Member is authorized to admit additional members and/or create different classes of members. 6. MANAGEMENT; POWERS. The business and affairs of the Company shall be managed by the Member. The Member is authorized to execute any and all documents on behalf of the Company necessary or appropriate in connection with the acquisition, financing, operation, management or development of any property of the Company. The Member may appoint one or more managers who shall be authorized to exercise such of the Member's rights and power as designated by the Member. 7. CAPITAL CONTRIBUTIONS. The initial capitalization of the Company by the Member is set forth on Schedule A. 8. ADDITIONAL CONTRIBUTIONS. The Member is not required to make any additional capital contribution to the Company, provided however, that additional capital contributions may be made at such time and in such amounts as the Member shall determine. 9. ALLOCATION OF PROFITS AND LOSSES. The Company's profits and losses shall be allocated to the Member as set forth on Schedule A. 10. DISTRIBUTIONS. Distributions shall be made to the Members at the times and in the aggregate amounts determined by the Member and in accordance with the same percentages as profits and losses are allocated. 11. ADMISSION OF ADDITIONAL MEMBERS. The Member may cause the Company to admit one or more additional members to the Company. 12. LIABILITY OF MEMBERS. The Member shall not have any liability for the obligations or liabilities of the Company. 13. EXCULPATION OF MEMBER. The Member shall not be liable to the Company for any breach of duty in such capacity, unless otherwise required by law. 14. GOVERNING LAW. This Agreement shall be governed by, and construed under, the laws of the State of Delaware, all rights and remedies being governed by said laws. IN WITNESS WHEREOF, the undersigned, intending to be legally bound hereby, has duly executed this Operating Agreement. X PROPERTIES, LLC By: Quoin Corporation, as sole member By: /s/ Desiree DeStefano ------------------------- Name: Desiree DeStefano Title: Vice President QUOIN CORPORATION By: /s/ Desiree DeStefano -------------------------- Name: Desiree DeStefano Title: Vice President SCHEDULE A
- --------------------------------- ---------------------------------- ------------------------------------------- NAME CAPITAL CONTRIBUTION ALLOCATION OF PROFITS AND LOSSES - --------------------------------- ---------------------------------- ------------------------------------------- Quoin Corporation $100,000 100% - --------------------------------- ---------------------------------- -------------------------------------------
EX-3.11 14 file013.txt ARTICLES OF INCORPORATION OF L.C.P. CORP. ARTICLES OF INCORPORATION OF LEHIGH CONSUMER PRODUCTS CORPORATION In compliance with the requirements of Section 1306 of the Pennsylvania Business Corporation Law of 1988, as amended (15 Pa. C.S.A.ss.1306), the undersigned, desiring to be incorporated as a business corporation, hereby certifies that: 1. The name of the corporation is Lehigh Consumer Products Corporation. 2. The address of the initial registered office of the corporation in the Commonwealth of Pennsylvania is 2834 Schoeneck Road, Macungie, PA 18062-9679, in Lehigh County. 3. The corporation is incorporated under the Pennsylvania Business Corporation Law of 1988, as amended, and shall have unlimited power to engage in all lawful business for which corporations may be incorporated under the Pennsylvania Business Corporation Law of 1988, as amended. 4. The aggregate number of shares which the corporation shall have authority to issue is 10,000 Common Shares, par value $1.00 per share. 5. Shareholders shall not have cumulative voting rights in the election of directors. 6. No director of the corporation shall be personally liable, as such, for monetary damages for any action taken, or any failure to take any action, except to the extent that by law a director's liability for monetary damages may not be limited. No amendment or repeal of this article 6 shall apply to or have any effect on the liability or alleged liability of any director of the corporation for or with respect to any acts or omissions of such director occurring prior to such amendment or repeal. 7. No officer shall be personally liable for monetary damages (other than under criminal statutes and under federal, state and local laws imposing liability on officers for the payment of taxes) unless his conduct constitutes self-dealing, willful misconduct or recklessness. No amendment or repeal of this article 7 shall apply to or have any effect on the liability or alleged liability of any officer of the corporation for or with respect to any acts or omissions of such officer occurring prior to such amendment or repeal. 8. Section 2538(a) of the Pennsylvania Business Corporation Law of 1988, as amended (15 Pa. C.S.A.ss.2538(a) and Subchapter E, Subchapter F, Subchapter G and Subchapter H or 15 Pa. C.S.A. Chapter 25 and any successor provisions shall not be applicable to the corporation. 9. The name and post office address of the incorporator are as follows: Name Address ---- ------- Katherine C. Lenard Drinker Biddle & Reath 1000 Westlakes Drive Suite 300 Berwyn, PA 19312 IN TESTIMONY WHEREOF, the incorporator has signed these Articles of Incorporation this 5th day of December, 1997. /s/ Katherine C. Lenard ------------------------ Katherine C. Lenard Incorporator EX-3.12 15 file014.txt BYLAWS OF LEHIGH CONSUMER PRODUCTS CORPORATION BYLAWS OF LEHIGH CONSUMER PRODUCTS CORPORATION (A Pennsylvania Business Corporation) ARTICLE 1. MEETINGS OF SHAREHOLDERS Section 1.01. Place of Meeting. Meetings of shareholders of the Corporation shall be held at such place, within the Commonwealth of Pennsylvania or elsewhere, as may be fixed from time to time by the Board of Directors. If no place is so fixed for a meeting, it shall be held at the Corporation's then principal executive office. Section 1.02. Annual Meeting. There shall be an annual meeting of shareholders, unless the Board of Directors shall fix some other hour or date therefor, at Ten o'clock a.m. on the first Tuesday in April in each year, if not a legal holiday under the laws of Pennsylvania, and, if a legal holiday, then on the next succeeding secular day not a legal holiday under the laws of Pennsylvania, at which the shareholders shall elect by plurality vote a Board of Directors and transact such other business as may properly be brought before the meeting. Section 1.03. Special Meetings. Special meetings of the shareholders may be called at any time by the Board of Directors, by shareholders entitled to cast at least 20% of the votes that all shareholders are entitled to cast at the particular meeting, or by the President, Treasurer or Secretary of the Corporation. Section 1.04. Notice of Meetings. Except as otherwise provided in Section 1707 of the Pennsylvania Business Corporation Law of 1988, as amended, written notice of every meeting of shareholders shall be given in any manner permitted by law by or at the direction of the Secretary or such other person as is authorized by the Board of Directors to each shareholder of record entitled to receipt thereof, at least five days prior to the day named for the meeting, unless a greater period of notice is required by law in a particular case. Section 1.05. Organization. At every meeting of the shareholders, the President, or in his absence, a chairman chosen by the shareholders, shall act as chairman; and the Secretary, or in his absence, a person appointed by the chairman, shall act as secretary. Section 1.06. Voting. Except as otherwise specified herein or in the Articles or required by law, whenever any corporate action is to be taken by vote of shareholders, it shall be authorized by a majority of the votes cast by all shareholders entitled to vote thereon and, if any shareholders are entitled to vote thereon as a class, upon receiving a majority of the votes cast by the shareholders entitled to vote as a class. In each election of directors, the candidates receiving the highest number of votes, up to the number of directors to be elected in such election, shall be elected. Section 1.07. Partial Consent. Unless the Corporation is a registered corporation as defined in the Pennsylvania Business Corporation Law of 1988, as amended, and the Articles do not expressly permit action by partial consent as provided in this Section 1.07, any action required or permitted to be taken at a meeting of the shareholders or of a class of shareholders may be taken without a meeting upon the written consent of shareholders who would have been entitled to cast the minimum number of votes that would be necessary to authorize the action at a meeting at which all shareholders entitled to vote thereon were present and voting. The consents shall be filed with the Secretary of the Corporation. The action shall not become effective until after at least ten (10) days' written notice of the action has been given to each shareholder entitled to vote thereon who has not consented thereto. ARTICLE 2. DIRECTORS Section 2.01. Number and Term of Office. The number of directors of the Corporation shall be designated from time to time by resolution of the Board of Directors and initially shall be one. Each director shall be elected for the term of one year and shall serve until his successor is elected and qualified or until his earlier death, resignation or removal. Section 2.02. Resignations. Any director may resign at any time by giving written notice to the Board of Directors, the President or the Secretary. The resignation shall be effective upon receipt thereof or at such subsequent time as may be specified in the notice of resignation. Unless otherwise specified therein, the acceptance of such resignation shall not be necessary to make it effective. Section 2.03. Annual Meeting. Immediately after each annual election of directors, the Board of Directors shall meet for the purpose of organization, election of officers, and the transaction of other business, at the place where such election of directors was held. Notice of such meeting need not be given. In the absence of a quorum at said meeting, the same may be held at any other time and place specified in a notice given as hereinafter provided for special meetings of the Board of Directors. Section 2.04. Regular Meetings. Regular meetings of the Board of Directors shall be held at such time and place as may be designated from time to time by the Board of Directors. Notice of such meetings need not be given. If the date fixed for any such regular meeting is a legal holiday under the laws of the State where such meeting is to be held, then the same shall be held on the next succeeding secular day not a legal holiday under the laws of said State, or at such other time as may be determined by resolution of the Board of Directors. At such meetings the Board of Directors may transact such business as may be brought before the meeting. Section 2.05. Special Meetings. Special meetings of the Board of Directors may be called by the President or the Chairman of the Board, and shall be called by the President or the Chairman of the Board, and shall be held at such time and place as may be designated in the notice of the meeting. Such notice shall be given by or at the direction of the person or persons authorized to call such meeting to each director at least two days prior to the day named for the meeting. 2 Section 2.06. Organization. Every meeting of the Board of Directors shall be presided over by the Chairman Board, if one has been selected and is present, and, if not, the President, or in the absence of the Chairman of the Board and the President, a chairman chosen by a majority of the directors present. The Secretary, or in his absence, a person appointed by the chairman, shall act as secretary. Section 2.07. Compensation. The Board of Directors shall have the authority to fix the compensation of directors for their services as directors and a director may be a salaried officer of the Corporation. ARTICLE 3. COMMITTEES Section 3.01. The Board of Directors may establish one or more committees to consist of one or more directors of the Corporation. Any committee, to the extent provided by the Board of Directors, shall have and may exercise all of the powers and authority of the Board of Directors except that a committee shall not have any power or authority as to the following: (i) the submission to shareholders of any action requiring approval of shareholders under the Pennsylvania Business Corporation Law of 1988, as amended; (ii) the creation or filling of vacancies in the Board of Directors; (iii) the adoption, amendment or repeal of the bylaws; (iv) the amendment or repeal of any resolution of the Board that by its terms is amendable or repealable only by the Board; or (v) action on matters committed by the bylaws or resolution of the Board of Directors to another committee of the Board. ARTICLE 4. OFFICERS Section 4.01. Number. The officers of the Corporation shall be a President, a Secretary and a Treasurer, and may include a Chairman of the Board and one or more Vice Presidents, one or more Assistant Secretaries, one or more Assistant Treasurers, and such other officers as the Board of Directors may authorize from time to time. Section 4.02. Qualifications. The President and Secretary shall be natural persons of full age. The Treasurer may be a corporation, but if a natural person shall be of full age. Section 4.03. Election and Term of Office. The officers of the Corporation shall be elected or appointed by the Board of Directors and each shall serve at the pleasure of the Board of Directors. Section 4.04. Resignations. Any officer may resign at any time by giving written notice to the Board of Directors, the President or the Secretary. The resignation shall be effective upon receipt thereof or at such subsequent time as may be specified in the notice of resignation. Unless otherwise specified therein, the acceptance of such resignation shall not be necessary to make it effective. Section 4.05. Chairman of the Board. If there is a Chairman of the Board, he shall preside at the meetings of the Board of Directors. Such Chairman shall also perform such other duties as may be specified by the Board of Directors from time to time and as do not conflict with the duties of the President. 3 Section 4.06. The President. The President shall be the chief executive officer of the Corporation and shall have general supervision over the business and operations of the Corporation, subject, however, to the control of the Board of Directors. He shall execute and deliver, in the name and on behalf of the Corporation, deeds, mortgages, bonds, agreements and other instruments authorized by the Board, except in cases where the signing and execution thereof is expressly delegated by the Board to some other officer or agent of the Corporation; and, in general, he shall perform all duties incident to the office of President, and such other duties as may be specified by the Board of Directors from time to time. Section 4.07. The Vice Presidents. In the absence or disability of the President or when so directed by the President, any Vice President may perform all the duties of the President, and, when so acting, shall have all the powers of, and be subject to all the restrictions upon, the President; provided, however, that no Vice President shall act as a member of or as chairman of any committee of the Board of Directors of which the President is a member or chairman by designation or ex-officio, unless such Vice President is a member of the Board of Directors and has been designated expressly by the Board of Directors as the alternate to the President for purposes of service on such committee. The Vice Presidents shall perform such other duties as from time to time may be assigned to them respectively by the Board of Directors or the President. Section 4.08. The Secretary. The Secretary shall record all the votes of the shareholders and of the directors and the minutes of the meetings of the shareholders and of the Board of Directors in a book or books to be kept for that purpose and shall see that notices of meetings of the Board and shareholders are given; he shall be the custodian of the seal of the Corporation and shall see that it is affixed to all documents to be executed on behalf of the Corporation under its seal; and, in general, he shall perform all duties incident to the office of Secretary, and such other duties as may from time to time be assigned to him by the Board of Directors or the President. Section 4.09. Assistant Secretaries. In the absence or disability of the Secretary or when so directed by the Secretary, any Assistant Secretary may perform all the duties of the Secretary, and, when so acting, shall have all the powers of, and be subject to all the restrictions upon, the Secretary. The Assistant Secretaries shall perform such other duties as from time to time may be assigned to them respectively by the Board of Directors, the President, or the Secretary. Section 4.10. The Treasurer. The Treasurer shall have charge of all receipts and disbursements of the Corporation and shall have or provide for the custody of its funds and securities. Unless the Board of Directors determines otherwise, the Treasurer shall have full authority to invest such funds and securities; to receive and give receipts for all money due and payable to the Corporation and to endorse checks, drafts, and warrants in its name and on its behalf and to give full discharge for the same. The Treasurer shall deposit the funds of the Corporation, except such as may be invested or required for current use, in such banks or other places of deposit as the Board of Directors may from time to time designate; and, in general, he shall perform all duties incident to the office of Treasurer and such other duties as may from time to time be assigned to him by the Board of Directors or the President. 4 Section 4.11. Assistant Treasurers. In the absence or disability of the Treasurer or when so directed by the Treasurer, any Assistant Treasurer may perform all the duties of the Treasurer, and, when so acting, shall have all the powers of, and be subject to all the restrictions upon, the Treasurer. The Assistant Treasurers shall perform such other duties as from time to time may be assigned to them respectively by the Board of Directors, the President or the Treasurer. ARTICLE 5. INDEMNIFICATION OF DIRECTORS AND OFFICERS Section 5.01. Indemnification. The Corporation shall indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action or proceeding, including actions by or in the right of the Corporation, whether civil, criminal, administrative or investigative, by reason of the fact that such person is or was a director or officer of the Corporation, or is or was serving while a director or officer of the Corporation at the request of the Corporation as a director, officer, employee, agent, fiduciary or other representative of another corporation for profit or not-for-profit, partnership, joint venture, trust, employee benefit plan or other enterprise, against expenses (including attorneys' fees), judgments, fines, excise taxes and amounts paid in settlement actually and reasonably incurred by such person in connection with such action or proceeding unless the act or failure to act giving rise to the claim for indemnification is determined by a court to have constituted willful misconduct or recklessness. Section 5.02. Advancement of Expenses. Expenses (including attorneys fees) incurred by an officer or director of the Corporation in defending any action or proceeding referred to in Section 5.01 shall be paid by the Corporation in advance of the final disposition of such action or proceeding upon receipt of an undertaking by or on behalf of such person to repay such amount if it shall ultimately be determined that the person is not entitled to be indemnified by the Corporation. Section 5.03. Other Rights. The indemnification and advancement of expenses provided by or pursuant to this Article shall not be deemed exclusive of any other rights to which those seeking indemnification or advancement of expenses may be entitled under the Corporation's Articles of Incorporation, any insurance or other agreement, vote of shareholders or directors or otherwise, both as to actions in their official capacity and as to actions in another capacity while holding an office, and shall continue as to a person who has ceased to be a director or officer and shall inure to the benefit of the heirs, executors and administrators of such person. Section 5.04. Security Fund; Indemnity Agreements. By resolution of the Board of Directors (notwithstanding their interest in the transaction) the Corporation may create and fund a trust fund or fund of any nature, and may enter into agreements with its directors, officers, employees and agents for the purpose of securing or insuring in any manner its obligation to indemnify or advance expenses provided for or authorized in this Article or the Business Corporation Law of 1988. Section 5.05. Modification. The duties of the Corporation to indemnify and to advance expenses to a director or officer provided in this Article shall be in the nature of a 5 contract between the Corporation and each such director or officer, and no amendment or repeal of any provision of this Article, and no amendment or termination of any trust or other fund created pursuant to Section 5.04, shall alter, to the detriment of such director or officer, the right of such person to the advance of expenses or indemnification related to a claim based on an act or failure to act which took place prior to such amendment, repeal or termination. ARTICLE 6. BORROWING, DEPOSITS, PROXIES, ETC. Section 6.01. Borrowing, etc. No officer, agent or employee of the Corporation shall have any power or authority to borrow money on its behalf, to pledge its credit, or to mortgage or pledge its real or personal property, except within the scope and to the extent of the authority delegated by the Board of Directors. Authority may be given by the Board of Directors for any of the above purposes and may be general or limited to specific instances. Section 6.02. Deposits and Investments. All funds of the Corporation shall be deposited from time to time to the credit of the Corporation in such banks, trust companies, or other depositaries, or invested in such manner, as may be authorized by these bylaws or by the Board of Directors and all such funds shall be withdrawn only upon checks or in accordance with written instructions signed by, and all such investments shall only be disposed of by, the President, the Treasurer and such other officers or employees as the Board of Directors may from time to time determine. Section 6.03. Proxies. Unless otherwise ordered by the Board of Directors, any officer of the Corporation may appoint an attorney, or attorneys (who may be or include such officer himself), in the name and on behalf of the Corporation, to cast the votes which the Corporation may be entitled to cast as a shareholder or otherwise in any other corporation any of whose shares or other securities are held by or for the Corporation, at meetings of the holders of the shares or other securities of such other corporation, or, in connection with the ownership of such shares or other securities, to consent in writing to any action by such other corporation, and may instruct the person or persons so appointed as to the manner of casting such votes or giving such consent, and may execute or cause to be executed in the name and on behalf of the Corporation and under its seal such written proxies or other instruments as he may deem necessary or proper in the premises. Section 6.04. Use of Conference Telephone Equipment. Unless the Board of Directors determines otherwise in a particular case, one or more persons may participate in any meeting of the Board of Directors or the shareholders by means of conference telephone or similar communications equipment by means of which all persons participating in the meeting can hear each other; however, the use of such equipment is not a matter of right for any person. Authorized participating in a meeting by means of such equipment shall constitute presence in person at such meeting. ARTICLE 7. SHARE CERTIFICATES; TRANSFER Section 7.01. Share Certificates. Share certificates, in the form prescribed by the Board of Directors, shall be signed by the President or a Vice President and by the Secretary or the Treasurer or an Assistant Secretary or an Assistant Treasurer of the Corporation, but such 6 signatures may be facsimiles, engraved or printed. In case any officer who has signed, or whose facsimile signature has been placed upon any share certificate shall have ceased to be such officer because of death, resignation, or otherwise, before the certificate is issued, it may be issued by the Corporation with the same effect as if the officer had not ceased to be such at the date of its issue. Section 7.02. Transfer of Shares. The Corporation or a Registrar or Transfer Agent of the Corporation shall maintain books in which the ownership and transfer of the Corporation's shares shall be definitely registered. Transfer of share certificates and the shares represented thereby shall be made only on the books of the Corporation by the owner thereof or by his attorney thereunto authorized, by a power of attorney duly executed and filed with the Secretary or a Transfer Agent of the Corporation and on surrender of the share certificates. Section 7.03. Intentionally Deleted. Section 7.04. Transfer Agent and Registrar; Regulations. The Corporation may, if and whenever the Board of Directors so determines, maintain, in the Commonwealth of Pennsylvania or any other state of the United States, one or more transfer offices or agencies, each in charge of a Transfer Agent designated by the Board of Directors, where the shares of the Corporation shall be transferable, and also one or more registry offices, each in charge of a Registrar (which may also be a Transfer Agent) designated by the Board, where such shares shall be registered. The Board may also make such additional rules and regulations as it may deem expedient concerning the issue, transfer and registration of its shares. Section 7.05. Lost, Destroyed and Mutilated Certificates. The Board of Directors, by standing resolution or by resolutions with respect to particular cases, may authorize the issue of new share certificates in lieu of share certificates lost, destroyed or mutilated, upon such terms and conditions as the Board may direct. ARTICLE 8. AMENDMENTS Section 8.01. Except as otherwise provided by Section 5.05 of these bylaws, these bylaws may be amended or repealed, or new bylaws may be adopted, either (i) by vote of the shareholders at any duly organized annual or special meeting of shareholders, or (ii) with respect to those matters that are not by statute committed exclusively to the shareholders and regardless of whether the shareholders have previously adopted or approved the bylaw being amended or repealed, by the Board of Directors. Any change in these bylaws shall take effect when adopted unless otherwise provided in the resolution effecting the change. No provision of these bylaws shall vest any property right in any shareholder as such. EX-4.1 16 file015.txt FIRST SUPPLEMENTAL INDENTURE SUPPLEMENTAL INDENTURE SUPPLEMENTAL INDENTURE (this "Supplemental Indenture"), dated as of May 7, 2003, among X Properties, LLC, a Delaware limited liability company (the "Guaranteeing Subsidiary"), a subsidiary of Jarden Corporation, formerly known as Alltrista Corporation, a Delaware corporation (the "Company"), the Company, the other Guarantors (as defined in the Indenture referred to herein) and The Bank of New York, as trustee under the indenture referred to below (the "Trustee"). W I T N E S S E T H WHEREAS, the Company has heretofore executed and delivered to the Trustee an indenture (the "Indenture"), dated as of April 24, 2002, providing for the issuance of 9 3/4% Senior Subordinated Notes due 2012 (the "Notes"); WHEREAS, the Indenture provides that under certain circumstances the Guaranteeing Subsidiary shall execute and deliver to the Trustee a supplemental indenture pursuant to which the Guaranteeing Subsidiary shall unconditionally guarantee all of the Company's Obligations under the Notes and the Indenture on the terms and conditions set forth herein (the "Subsidiary Guarantee"); and WHEREAS, pursuant to Section 9.01 of the Indenture, the Trustee is authorized to execute and deliver this Supplemental Indenture. NOW THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the receipt of which is hereby acknowledged, the Guaranteeing Subsidiary and the Trustee mutually covenant and agree for the equal and ratable benefit of the Holders of the Notes as follows: 1. CAPITALIZED TERMS. Capitalized terms used herein without definition shall have the meanings assigned to them in the Indenture. 2. AGREEMENT TO GUARANTEE. The Guaranteeing Subsidiary hereby agrees to provide an unconditional Guarantee on the terms and subject to the conditions set forth in the Subsidiary Guarantee and in the Indenture, including but not limited to Article 11 thereof. 3. EXECUTION AND DELIVERY. The Guaranteeing Subsidiary agrees that the Subsidiary Guarantees shall remain in full force and effect notwithstanding any failure to endorse on each Note a notation of such Subsidiary Guarantee. 4. NO RECOURSE AGAINST OTHERS. No past, present or future member, manager, officer, employee, or agent of the Guaranteeing Subsidiary, as such, shall have any liability for any obligations of the Company or any Guaranteeing Subsidiary under the Notes, any Subsidiary Guarantees, the Indenture or this Supplemental Indenture or for any claim based on, in respect of, or by reason of, such obligations or their creation. Each Holder of the Notes by accepting a Note waives and releases all such liability. The waiver and release are part of the consideration F-1 for issuance of the Notes. Such waiver may not be effective to waive liabilities under the federal securities laws and it is the view of the SEC that such a waiver is against public policy. 5. NEW YORK LAW TO GOVERN. THE INTERNAL LAW OF THE STATE OF NEW YORK SHALL GOVERN AND BE USED TO CONSTRUE THIS SUPPLEMENTAL INDENTURE BUT WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY. 6. COUNTERPARTS. The parties may sign any number of copies of this Supplemental Indenture. Each signed copy shall be an original, but all of them together represent the same agreement. 7. EFFECT OF HEADINGS. The Section headings herein are for convenience only and shall not affect the construction hereof. 8. THE TRUSTEE. The Trustee shall not be responsible in any manner whatsoever for or in respect of the validity or sufficiency of this Supplemental Indenture or for or in respect of the recitals contained herein, all of which recitals are made solely by the Guaranteeing Subsidiary and the Company. IN WITNESS WHEREOF, the parties hereto have caused this Supplemental Indenture to be duly executed, all as of the date first above written. Dated: May 7, 2003
X PROPERTIES, LLC By: Quoin Corporation, as sole member By: /s/ Desiree DeStefano ------------------------------------- Name: Desiree DeStefano Title: Vice President JARDEN CORPORATION THE BANK OF NEW YORK, as Trustee By: /s/ Desiree DeStefano By: /s/ Julie Salovitch-Miller ------------------------------------- ------------------------------------- Name: Desiree DeStefano Name: Julie Salovitch-Miller Title: Senior Vice President Title: Vice President ALLTRISTA NEWCO ALLTRISTA PLASTICS CORPORATION CORPORATION By: /s/ Desiree DeStefano By: /s/ Desiree DeStefano ------------------------------------- ------------------------------------- Name: Desiree DeStefano Name: Desiree DeStefano Title: Vice President Title: Vice President ALLTRISTA ZINC PRODUCTS, L.P. HEARTHMARK, INC. By: Alltrista Newco Corporation, its General Partner By: /s/ Desiree DeStefano By: /s/ Desiree DeStefano ------------------------------------- ------------------------------------- Name: Desiree DeStefano Name: Desiree DeStefano Title: Vice President Title: Vice President QUOIN CORPORATION TILIA, INC. By: /s/ Desiree DeStefano By: /s/ Desiree DeStefano ------------------------------------- ------------------------------------- Name: Desiree DeStefano Name: Desiree DeStefano Title: Vice President Title: Vice President TILIA DIRECT, INC. TILIA INTERNATIONAL, INC. By: /s/ Desiree DeStefano By: /s/ Desiree DeStefano ------------------------------------- ------------------------------------- Name: Desiree DeStefano Name: Desiree DeStefano Title: Vice President Title: Vice President TRIENDA CORPORATION By: /s/ Desiree DeStefano ------------------------------------- Name: Desiree DeStefano Title: Vice President
EX-4.2 17 file016.txt SECOND SUPPLEMENTAL INDENTURE SECOND SUPPLEMENTAL INDENTURE SECOND SUPPLEMENTAL INDENTURE (this "Supplemental Indenture"), dated as of May 28, 2003, among O.W.D., Incorporated, a New York corporation ("OWD"), Tupper Lake Plastics, Incorporated, a New York corporation (together with OWD, the "Guaranteeing Subsidiaries"), each a subsidiary of Jarden Corporation, formerly known as Alltrista Corporation, a Delaware corporation (the "Company"), the Company, the other Guarantors (as defined in the Indenture referred to herein) and The Bank of New York, as trustee under the indenture referred to below (the "Trustee"). W I T N E S S E T H WHEREAS, the Company has heretofore executed and delivered to the Trustee an indenture (the "Original Indenture"), dated as of April 24, 2002, among the Company, the Guarantors and the Trustee, as supplemented by the supplemental indenture, dated as of May 7, 2003, among the Company, the Guarantors and the Trustee (together with the Original Indenture, the "Indenture"), providing for the issuance of 9 3/4% Senior Subordinated Notes due 2012 (the "Notes"); WHEREAS, the Indenture provides that under certain circumstances the Guaranteeing Subsidiaries shall execute and deliver to the Trustee a supplemental indenture pursuant to which the Guaranteeing Subsidiaries shall unconditionally guarantee all of the Company's Obligations under the Notes and the Indenture on the terms and conditions set forth herein (the "Subsidiary Guarantee"); and WHEREAS, pursuant to Section 9.01 of the Indenture, the Trustee is authorized to execute and deliver this Supplemental Indenture. NOW THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the receipt of which is hereby acknowledged, the Guaranteeing Subsidiaries and the Trustee mutually covenant and agree for the equal and ratable benefit of the Holders of the Notes as follows: 1. CAPITALIZED TERMS. Capitalized terms used herein without definition shall have the meanings assigned to them in the Indenture. 2. AGREEMENT TO GUARANTEE. The Guaranteeing Subsidiaries hereby agree to provide an unconditional Guarantee on the terms and subject to the conditions set forth in the Subsidiary Guarantee and in the Indenture, including but not limited to Article 11 thereof. 3. EXECUTION AND DELIVERY. Each Guaranteeing Subsidiary agrees that the Subsidiary Guarantees shall remain in full force and effect notwithstanding any failure to endorse on each Note a notation of such Subsidiary Guarantee. 4. NO RECOURSE AGAINST OTHERS. No past, present or future director, officer, employee, incorporator, stockholder or agent of the Guaranteeing Subsidiaries, as such, shall have any liability for any obligations of the Company or any Guaranteeing Subsidiary under the Notes, any Subsidiary Guarantees, the Indenture or this Supplemental Indenture or for any claim based on, in respect of, or by reason of, such obligations or their creation. Each Holder of the Notes by accepting a Note or a Subsidiary Guarantee waives and releases all such liability. The waiver and release are part of the consideration for issuance of the Notes. Such waiver may not be effective to waive liabilities under the federal securities laws and it is the view of the SEC that such a waiver is against public policy. 5. NEW YORK LAW TO GOVERN. THE INTERNAL LAW OF THE STATE OF NEW YORK SHALL GOVERN AND BE USED TO CONSTRUE THIS SUPPLEMENTAL INDENTURE BUT WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY. 6. COUNTERPARTS. The parties may sign any number of copies of this Supplemental Indenture. Each signed copy shall be an original, but all of them together represent the same agreement. 7. EFFECT OF HEADINGS. The Section headings herein are for convenience only and shall not affect the construction hereof. 8. THE TRUSTEE. The Trustee shall not be responsible in any manner whatsoever for or in respect of the validity or sufficiency of this Supplemental Indenture or for or in respect of the recitals contained herein, all of which recitals are made solely by the Guaranteeing Subsidiaries and the Company. IN WITNESS WHEREOF, the parties hereto have caused this Supplemental Indenture to be duly executed, all as of the date first above written. Dated: May 28, 2003
O.W.D., INCORPORATED TUPPER LAKE PLASTICS, INCORPORATED By: /s/ Desiree DeStefano By: /s/ Desiree DeStefano ------------------------------------- ------------------------------------- Name: Desiree DeStefano Name: Desiree DeStefano Title: Vice President Title: Vice President JARDEN CORPORATION THE BANK OF NEW YORK, as Trustee By: /s/ Desiree DeStefano By: /s/ Julie Salovitch-Miller ------------------------------------- ------------------------------------- Name: Desiree DeStefano Name: Julie Salovitch-Miller Title: Senior Vice President Title: Vice President ALLTRISTA NEWCO ALLTRISTA PLASTICS CORPORATION CORPORATION By: /s/ Desiree DeStefano By: /s/ Desiree DeStefano ------------------------------------- ------------------------------------- Name: Desiree DeStefano Name: Desiree DeStefano Title: Vice President Title: Vice President ALLTRISTA ZINC PRODUCTS, L.P. HEARTHMARK, INC. By: Alltrista Newco Corporation, its General Partner By: /s/ Desiree DeStefano By: /s/ Desiree DeStefano ------------------------------------- ------------------------------------- Name: Desiree DeStefano Name: Desiree DeStefano Title: Vice President Title: Vice President QUOIN CORPORATION TILIA, INC. By: /s/ Desiree DeStefano By: /s/ Desiree DeStefano ------------------------------------- ------------------------------------- Name: Desiree DeStefano Name: Desiree DeStefano Title: Vice President Title: Vice President TILIA DIRECT, INC. TILIA INTERNATIONAL, INC. By: /s/ Desiree DeStefano By: /s/ Desiree DeStefano ------------------------------------- ------------------------------------- Name: Desiree DeStefano Name: Desiree DeStefano Title: Vice President Title: Vice President TRIENDA CORPORATION X PROPERTIES, LLC By: Quoin Corporation, as sole member By: /s/ Desiree DeStefano By: /s/ Desiree DeStefano ------------------------------------- ------------------------------------- Name: Desiree DeStefano Name: Desiree DeStefano Title: Vice President Title: Vice President
EX-4.3 18 file017.txt THIRD SUPPLEMENTAL INDENTURE THIRD SUPPLEMENTAL INDENTURE THIRD SUPPLEMENTAL INDENTURE (this "Supplemental Indenture"), dated as of September 25, 2003, among Lehigh Consumer Products Corporation, a Pennsylvania corporation (the "Guaranteeing Subsidiary"), which is a subsidiary of Jarden Corporation, formerly known as Alltrista Corporation, a Delaware corporation (the "Company"), the Company, the other Guarantors (as defined in the Indenture referred to herein) and The Bank of New York, as trustee under the indenture referred to below (the "Trustee"). W I T N E S S E T H WHEREAS, the Company has heretofore executed and delivered to the Trustee the Indenture dated as of April 24, 2002, among the Company and the Trustee, as supplemented by the First Supplemental Indenture dated as of May 7, 2003, among the Company, the Guarantors and the Trustee, and as further supplemented by the Second Supplemental Indenture dated as of May 28, 2003, among the Company, the Trustee, the Guarantors and the Guaranteeing Subsidiaries (such Guaranteeing Subsidiaries to be included with the meaning of the term the Guarantors as of the execution of the Second Supplemental Indenture) (collectively, the "Indenture"), providing for the issuance of 9 3/4% Senior Subordinated Notes due 2012 (the "Notes"); WHEREAS, the Indenture provides that under certain circumstances the Guaranteeing Subsidiary shall execute and deliver to the Trustee a supplemental indenture pursuant to which the Guaranteeing Subsidiary shall unconditionally guarantee all of the Company's Obligations under the Notes and the Indenture on the terms and conditions set forth herein (the "Subsidiary Guarantee"); and WHEREAS, pursuant to Section 9.01 of the Indenture, the Trustee is authorized to execute and deliver this Supplemental Indenture. NOW THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the receipt of which is hereby acknowledged, the Guaranteeing Subsidiary and the Trustee mutually covenant and agree for the equal and ratable benefit of the Holders of the Notes as follows: 1. CAPITALIZED TERMS. Capitalized terms used herein without definition shall have the meanings assigned to them in the Indenture. 2. AGREEMENT TO GUARANTEE. The Guaranteeing Subsidiary hereby agrees to provide an unconditional Guarantee on the terms and subject to the conditions set forth in the Subsidiary Guarantee and in the Indenture, including but not limited to Article 11 thereof. 3. EXECUTION AND DELIVERY. The Guaranteeing Subsidiary agrees that the Subsidiary Guarantee shall remain in full force and effect notwithstanding any failure to endorse on each Note a notation of such Subsidiary Guarantee. 4. NO RECOURSE AGAINST OTHERS. No past, present or future director, officer, employee, incorporator, stockholder or agent of the Guaranteeing Subsidiary, as such, shall have any liability for any obligations of the Company or any Guaranteeing Subsidiary under the Notes, any Subsidiary Guarantee, the Indenture or this Supplemental Indenture or for any claim based on, in respect of, or by reason of, such obligations or their creation. Each Holder of the Notes by accepting a Note or a Subsidiary Guarantee waives and releases all such liability. The waiver and release are part of the consideration for issuance of the Notes. Such waiver may not be effective to waive liabilities under the federal securities laws and it is the view of the SEC that such a waiver is against public policy. 5. NEW YORK LAW TO GOVERN. THE INTERNAL LAW OF THE STATE OF NEW YORK SHALL GOVERN AND BE USED TO CONSTRUE THIS SUPPLEMENTAL INDENTURE BUT WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY. 6. COUNTERPARTS. The parties may sign any number of copies of this Supplemental Indenture. Each signed copy shall be an original, but all of them together represent the same agreement. 7. EFFECT OF HEADINGS. The Section headings herein are for convenience only and shall not affect the construction hereof. 8. THE TRUSTEE. The Trustee shall not be responsible in any manner whatsoever for or in respect of the validity or sufficiency of this Supplemental Indenture or for or in respect of the recitals and statements contained herein, all of which recitals and statements are made solely by the Guaranteeing Subsidiary and the Company. IN WITNESS WHEREOF, the parties hereto have caused this Supplemental Indenture to be duly executed, all as of the date first above written. Dated: September 25, 2003
LEHIGH CONSUMER PRODUCTS CORPORATION By: /s/ Desiree DeStefano ----------------------------------- Name: Desiree DeStefano Title: Senior Vice President JARDEN CORPORATION THE BANK OF NEW YORK, as Trustee By: /s/ Desiree DeStefano By: /s/ Julie Salovitch-Miller ----------------------------------- ----------------------------------- Name: Desiree DeStefano Name: Julie Salovitch-Miller Title: Senior Vice President Title: Vice President ALLTRISTA NEWCO ALLTRISTA PLASTICS CORPORATION CORPORATION By: /s/ Desiree DeStefano By: /s/ Desiree DeStefano ----------------------------------- ----------------------------------- Name: Desiree DeStefano Name: Desiree DeStefano Title: Vice President Title: Vice President ALLTRISTA ZINC PRODUCTS, L.P. HEARTHMARK, INC. By: Alltrista Newco Corporation, its General Partner By: /s/ Desiree DeStefano By: /s/ Desiree DeStefano --------------------------------- ----------------------------------- Name: Desiree DeStefano Name: Desiree DeStefano Title: Vice President Title: Vice President QUOIN CORPORATION TILIA, INC. By: /s/ Desiree DeStefano By: /s/ Desiree DeStefano ----------------------------------- ----------------------------------- Name: Desiree DeStefano Name: Desiree DeStefano Title: Vice President Title: Vice President TILIA DIRECT, INC. TILIA INTERNATIONAL, INC. By: /s/ Desiree DeStefano By: /s/ Desiree DeStefano ----------------------------------- ----------------------------------- Name: Desiree DeStefano Name: Desiree DeStefano Title: Vice President Title: Vice President TRIENDA CORPORATION X PROPERTIES, LLC By: Quoin Corporation, as sole member By: /s/ Desiree DeStefano By: /s/ Desiree DeStefano ----------------------------------- ----------------------------------- Name: Desiree DeStefano Name: Desiree DeStefano Title: Vice President Title: Vice President O.W.D., INCORPORATED TUPPER LAKE PLASTICS, INCORPORATED By: /s/ Desiree DeStefano By: /s/ Desiree DeStefano ----------------------------------- ----------------------------------- Name: Desiree DeStefano Name: Desiree DeStefano Title: Vice President Title: Vice President
EX-4.4 19 file018.txt SECOND SUPPLEMENTAL INDENTURE SECOND SUPPLEMENTAL INDENTURE SECOND SUPPLEMENTAL INDENTURE (this "Supplemental Indenture"), dated as of May 28, 2003, among O.W.D., Incorporated, a New York corporation ("OWD"), Tupper Lake Plastics, Incorporated, a New York corporation (together with OWD, the "Guaranteeing Subsidiaries"), each a subsidiary of Jarden Corporation (or its permitted successor), a Delaware corporation (the "Company"), the Company, the other Guarantors (as defined in the Indenture referred to herein) and The Bank of New York, as trustee under the indenture referred to below (the "Trustee"). W I T N E S S E T H WHEREAS, the Company has heretofore executed and delivered to the Trustee the Indenture dated as of January 29, 2003 between the Company and the Trustee, as supplemented by the first supplemental indenture dated as of May 8, 2003 among the Company, the Guarantors and the Trustee (the "Indenture") providing for the issuance of 9 3/4% Senior Subordinated Notes due 2012 (the "Notes"); WHEREAS, the Indenture provides that under certain circumstances the Guaranteeing Subsidiaries shall execute and deliver to the Trustee a supplemental indenture pursuant to which the Guaranteeing Subsidiaries shall unconditionally guarantee all of the Company's Obligations under the Notes and the Indenture on the terms and conditions set forth herein (the "Subsidiary Guarantee"); and WHEREAS, pursuant to Section 9.01 of the Indenture, the Trustee is authorized to execute and deliver this Supplemental Indenture. NOW THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the receipt of which is hereby acknowledged, the Guaranteeing Subsidiaries and the Trustee mutually covenant and agree for the equal and ratable benefit of the Holders of the Notes as follows: 1. CAPITALIZED TERMS. Capitalized terms used herein without definition shall have the meanings assigned to them in the Indenture. 2. AGREEMENT TO GUARANTEE. The Guaranteeing Subsidiaries hereby agree to provide an unconditional Guarantee on the terms and subject to the conditions set forth in the Subsidiary Guarantee and in the Indenture, including but not limited to Article 11 thereof. 3. EXECUTION AND DELIVERY. Each Guaranteeing Subsidiary agrees that the Subsidiary Guarantees shall remain in full force and effect notwithstanding any failure to endorse on each Note a notation of such Subsidiary Guarantee. 4. NO RECOURSE AGAINST OTHERS. No past, present or future director, officer, employee, incorporator, stockholder or agent of the Guaranteeing Subsidiaries, as such, shall have any liability for any obligations of the Company or any Guaranteeing Subsidiary under the Notes, any Subsidiary Guarantees, the Indenture or this Supplemental Indenture or for any claim based on, in respect of, or by reason of, such obligations or their creation. Each Holder of the Notes by accepting a Note or a Subsidiary Guarantee waives and releases all such liability. The waiver and release are part of the consideration for issuance of the Notes. Such waiver may not be effective to waive liabilities under the federal securities laws and it is the view of the SEC that such a waiver is against public policy. 5. NEW YORK LAW TO GOVERN. THE INTERNAL LAW OF THE STATE OF NEW YORK SHALL GOVERN AND BE USED TO CONSTRUE THIS SUPPLEMENTAL INDENTURE BUT WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY. 6. COUNTERPARTS. The parties may sign any number of copies of this Supplemental Indenture. Each signed copy shall be an original, but all of them together represent the same agreement. 7. EFFECT OF HEADINGS. The Section headings herein are for convenience only and shall not affect the construction hereof. 8. THE TRUSTEE. The Trustee shall not be responsible in any manner whatsoever for or in respect of the validity or sufficiency of this Supplemental Indenture or for or in respect of the recitals contained herein, all of which recitals are made solely by the Guaranteeing Subsidiaries and the Company. IN WITNESS WHEREOF, the parties hereto have caused this Supplemental Indenture to be duly executed, all as of the date first above written. Dated: May 28, 2003
O.W.D., INCORPORATED TUPPER LAKE PLASTICS, INCORPORATED By: /s/ Desiree DeStefano By: /s/ Desiree DeStefano ------------------------------------- ------------------------------------- Name: Desiree DeStefano Name: Desiree DeStefano Title: Vice President Title: Vice President JARDEN CORPORATION THE BANK OF NEW YORK, as Trustee By: /s/ Desiree DeStefano By: /s/ Julie Salovitch-Miller ------------------------------------- ------------------------------------- Name: Desiree DeStefano Name: Julie Salovitch-Miller Title: Senior Vice President Title: Vice President ALLTRISTA NEWCO ALLTRISTA PLASTICS CORPORATION CORPORATION By: /s/ Desiree DeStefano By: /s/ Desiree DeStefano ------------------------------------- ------------------------------------- Name: Desiree DeStefano Name: Desiree DeStefano Title: Vice President Title: Vice President ALLTRISTA ZINC PRODUCTS, L.P. HEARTHMARK, INC. By: Alltrista Newco Corporation, its General Partner By: /s/ Desiree DeStefano By: /s/ Desiree DeStefano ------------------------------------- ------------------------------------- Name: Desiree DeStefano Name: Desiree DeStefano Title: Vice President Title: Vice President QUOIN CORPORATION TILIA, INC. By: /s/ Desiree DeStefano By: /s/ Desiree DeStefano ------------------------------------- ------------------------------------- Name: Desiree DeStefano Name: Desiree DeStefano Title: Vice President Title: Vice President TILIA DIRECT, INC. TILIA INTERNATIONAL, INC. By: /s/ Desiree DeStefano By: /s/ Desiree DeStefano ------------------------------------- ------------------------------------- Name: Desiree DeStefano Name: Desiree DeStefano Title: Vice President Title: Vice President
EX-4.5 20 file019.txt THIRD SUPPLEMENTAL INDENTURE THIRD SUPPLEMENTAL INDENTURE THIRD SUPPLEMENTAL INDENTURE (this "Supplemental Indenture"), dated as of August 28, 2003, among Jarden Corporation, formerly known as Alltrista Corporation, a Delaware corporation (the "Company"), the Guarantors (as defined in the Indenture referred to herein) and The Bank of New York, a New York banking corporation, as trustee under the indenture referred to below (the "Trustee"). W I T N E S S E T H WHEREAS, the Company has heretofore executed and delivered to the Trustee the Indenture dated as of January 29, 2003, among the Company and the Trustee, as supplemented by the First Supplemental Indenture dated as of May 8, 2003 among the Company, the Guarantors and the Trustee, and as further supplemented by the Second Supplemental Indenture dated as of May 28, 2003, among the Company, the Trustee, the Guarantors and the Guaranteeing Subsidiaries (such Guaranteeing Subsidiaries to be included with the meaning of the term the Guarantors as of the execution of the Second Supplemental Indenture) (collectively, the "Indenture"), providing for the issuance of 9 3/4% Senior Subordinated Notes due 2012 (the "Notes"); WHEREAS, it had been the intention of the parties to the Indenture for the Indenture to be substantially similar in its terms to the Indenture dated as of April 24, 2002, among the Company and the Trustee, as supplemented by the First Supplemental Indenture dated as of May 7, 2003 among the Company, the Guarantors and the Trustee, and as further supplemented by the Second Supplemental Indenture dated as of May 28, 2003, among the Company, the Trustee, the Guarantors and the Guaranteeing Subsidiaries (such Guaranteeing Subsidiaries to be included with the meaning of the term the Guarantors as of the execution of the Second Supplemental Indenture) (collectively, the "April 24 Indenture"), providing for the issuance of 9 3/4% Senior Subordinated Notes due 2012; WHEREAS, the April 24 Indenture defines the Company's credit agreement as "New Senior Credit Facility" and it had been the intention of the parties to the Indenture to retain the use of the term "New Senior Credit Facility" therein; WHEREAS, while the Indenture uses the term "New Senior Credit Facility" throughout the agreement, Section 1.01 of the Indenture (the Definitions section) gives a definition for "Senior Credit Facility" instead; WHEREAS, the term "Senior Credit Facility" in the Indenture should have been defined therein as "New Senior Credit Facility", as such term is consistent with its use throughout the Indenture as well as throughout the April 24 Indenture, and the Company and the Guarantors deem this to be an immaterial inconsistency; WHEREAS, pursuant to Section 9.01 of the Indenture, the Company, the Guarantors and the Trustee may amend or supplement the Indenture to cure any ambiguity, defect or inconsistency and, therefore, the Company, the Guarantors and the Trustee are authorized pursuant to Section 9.01 of the Indenture to execute and deliver this Supplemental Indenture. NOW THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the receipt of which is hereby acknowledged, the Company, the Guarantors and the Trustee mutually covenant and agree for the equal and ratable benefit of the Holders of the Notes as follows: 1. CAPITALIZED TERMS. Capitalized terms used herein without definition shall have the meanings assigned to them in the Indenture. 2. SECTION 1.01 OF INDENTURE. The defined term "Senior Credit Facility" in Section 1.01 of the Indenture shall be revised to read "New Senior Credit Facility." The definition of that term shall otherwise remain the same in all other respects and all references to "New Senior Credit Facility" in the Indenture shall have the meaning given such definition. 3. NEW YORK LAW TO GOVERN. THE INTERNAL LAW OF THE STATE OF NEW YORK SHALL GOVERN AND BE USED TO CONSTRUE THIS SUPPLEMENTAL INDENTURE BUT WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY. 4. COUNTERPARTS. The parties may sign any number of copies of this Supplemental Indenture. Each signed copy shall be an original, but all of them together represent the same agreement. 5. EFFECT OF HEADINGS. The Section headings herein are for convenience only and shall not affect the construction hereof. 6. THE TRUSTEE. The Trustee shall not be responsible in any manner whatsoever for or in respect of the validity or sufficiency of this Supplemental Indenture or for or in respect of the recitals contained herein, all of which recitals are made solely by the Guarantors and the Company. IN WITNESS WHEREOF, the parties hereto have caused this Supplemental Indenture to be duly executed, all as of the date first above written. Dated: August 28, 2003
O.W.D., INCORPORATED TUPPER LAKE PLASTICS, INCORPORATED By: /s/ Desiree DeStefano By: /s/ Desiree DeStefano ------------------------------------- ------------------------------------- Name: Desiree DeStefano Name: Desiree DeStefano Title: Vice President Title: Vice President JARDEN CORPORATION THE BANK OF NEW YORK, as Trustee By: /s/ Desiree DeStefano By: /s/ Julie Salovitch-Miller ------------------------------------- ------------------------------------- Name: Desiree DeStefano Name: Julie Salovitch-Miller Title: Senior Vice President Title: Vice President ALLTRISTA NEWCO ALLTRISTA PLASTICS CORPORATION CORPORATION By: /s/ Desiree DeStefano By: /s/ Desiree DeStefano ------------------------------------- ------------------------------------- Name: Desiree DeStefano Name: Desiree DeStefano Title: Vice President Title: Vice President ALLTRISTA ZINC PRODUCTS, L.P. HEARTHMARK, INC. By: Alltrista Newco Corporation, its General Partner By: /s/ Desiree DeStefano By: /s/ Desiree DeStefano ------------------------------------- ------------------------------------- Name: Desiree DeStefano Name: Desiree DeStefano Title: Vice President Title: Vice President QUOIN CORPORATION TILIA, INC. By: /s/ Desiree DeStefano By: /s/ Desiree DeStefano ------------------------------------- ------------------------------------- Name: Desiree DeStefano Name: Desiree DeStefano Title: Vice President Title: Vice President TILIA DIRECT, INC. TILIA INTERNATIONAL, INC. By: /s/ Desiree DeStefano By: /s/ Desiree DeStefano ------------------------------------- ------------------------------------- Name: Desiree DeStefano Name: Desiree DeStefano Title: Vice President Title: Vice President TRIENDA CORPORATION X PROPERTIES, LLC By: Quoin Corporation, as sole member By: /s/ Desiree DeStefano By: /s/ Desiree DeStefano ------------------------------------- ------------------------------------- Name: Desiree DeStefano Name: Desiree DeStefano Title: Vice President Title: Vice President
EX-4.6 21 file020.txt FOURTH SUPPLEMENTAL INDENTURE FOURTH SUPPLEMENTAL INDENTURE FOURTH SUPPLEMENTAL INDENTURE (this "Supplemental Indenture"), dated as of September 25, 2003, among Lehigh Consumer Products Corporation, a Pennsylvania corporation (the "Guaranteeing Subsidiary"), which is a subsidiary of Jarden Corporation, formerly known as Alltrista Corporation, a Delaware corporation (the "Company"), the Company, the other Guarantors (as defined in the Indenture referred to herein) and The Bank of New York, as trustee under the indenture referred to below (the "Trustee"). W I T N E S S E T H WHEREAS, the Company has heretofore executed and delivered to the Trustee the Indenture dated as of January 29, 2003, between the Company and the Trustee, as supplemented by the First Supplemental Indenture dated as of May 8, 2003, among the Company, the Guarantors and the Trustee, and as further supplemented by the Second Supplemental Indenture dated as of May 28, 2003, among the Company, the Trustee, the Guarantors and the Guaranteeing Subsidiaries (such Guaranteeing Subsidiaries to be included with the meaning of the term the Guarantors as of the execution of the Second Supplemental Indenture), and as further supplemented by the Third Supplemental Indenture dated as of August 28, 2003, among the Company, the Trustee and the Guarantors (collectively, the "Indenture") providing for the issuance of 9 3/4% Senior Subordinated Notes due 2012 (the "Notes"); WHEREAS, the Indenture provides that under certain circumstances the Guaranteeing Subsidiary shall execute and deliver to the Trustee a supplemental indenture pursuant to which the Guaranteeing Subsidiary shall unconditionally guarantee all of the Company's Obligations under the Notes and the Indenture on the terms and conditions set forth herein (the "Subsidiary Guarantee"); and WHEREAS, pursuant to Section 9.01 of the Indenture, the Trustee is authorized to execute and deliver this Supplemental Indenture. NOW THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the receipt of which is hereby acknowledged, the Guaranteeing Subsidiary and the Trustee mutually covenant and agree for the equal and ratable benefit of the Holders of the Notes as follows: 1. CAPITALIZED TERMS. Capitalized terms used herein without definition shall have the meanings assigned to them in the Indenture. 2. AGREEMENT TO GUARANTEE. The Guaranteeing Subsidiary hereby agrees to provide an unconditional Guarantee on the terms and subject to the conditions set forth in the Subsidiary Guarantee and in the Indenture, including but not limited to Article 11 thereof. 3. EXECUTION AND DELIVERY. The Guaranteeing Subsidiary agrees that the Subsidiary Guarantee shall remain in full force and effect notwithstanding any failure to endorse on each Note a notation of such Subsidiary Guarantee. 4. NO RECOURSE AGAINST OTHERS. No past, present or future director, officer, employee, incorporator, stockholder or agent of the Guaranteeing Subsidiary, as such, shall have any liability for any obligations of the Company or any Guaranteeing Subsidiary under the Notes, any Subsidiary Guarantee, the Indenture or this Supplemental Indenture or for any claim based on, in respect of, or by reason of, such obligations or their creation. Each Holder of the Notes by accepting a Note or a Subsidiary Guarantee waives and releases all such liability. The waiver and release are part of the consideration for issuance of the Notes. Such waiver may not be effective to waive liabilities under the federal securities laws and it is the view of the SEC that such a waiver is against public policy. 5. NEW YORK LAW TO GOVERN. THE INTERNAL LAW OF THE STATE OF NEW YORK SHALL GOVERN AND BE USED TO CONSTRUE THIS SUPPLEMENTAL INDENTURE BUT WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY. 6. COUNTERPARTS. The parties may sign any number of copies of this Supplemental Indenture. Each signed copy shall be an original, but all of them together represent the same agreement. 7. EFFECT OF HEADINGS. The Section headings herein are for convenience only and shall not affect the construction hereof. 8. THE TRUSTEE. The Trustee shall not be responsible in any manner whatsoever for or in respect of the validity or sufficiency of this Supplemental Indenture or for or in respect of the recitals and statements contained herein, all of which recitals and statements are made solely by the Guaranteeing Subsidiary and the Company. IN WITNESS WHEREOF, the parties hereto have caused this Supplemental Indenture to be duly executed, all as of the date first above written. Dated: September 25, 2003
LEHIGH CONSUMER PRODUCTS CORPORATION By: /s/ Desiree DeStefano --------------------------------- Name: Desiree DeStefano Title: Senior Vice President JARDEN CORPORATION THE BANK OF NEW YORK, as Trustee By: /s/ Desiree DeStefano By: /s/ Julie Salovitch-Miller --------------------------------- ----------------------------------- Name: Desiree DeStefano Name: Julie Salovitch-Miller Title: Senior Vice President Title: Vice President ALLTRISTA NEWCO ALLTRISTA PLASTICS CORPORATION CORPORATION By: /s/ Desiree DeStefano By: /s/ Desiree DeStefano --------------------------------- ----------------------------------- Name: Desiree DeStefano Name: Desiree DeStefano Title: Vice President Title: Vice President ALLTRISTA ZINC PRODUCTS, L.P. HEARTHMARK, INC. By: Alltrista Newco Corporation, its General Partner By: /s/ Desiree DeStefano By: /s/ Desiree DeStefano ------------------------------------- ----------------------------------- Name: Desiree DeStefano Name: Desiree DeStefano Title: Vice President Title: Vice President QUOIN CORPORATION TILIA, INC. By: /s/ Desiree DeStefano By: /s/ Desiree DeStefano --------------------------------- ----------------------------------- Name: Desiree DeStefano Name: Desiree DeStefano Title: Vice President Title: Vice President TILIA DIRECT, INC. TILIA INTERNATIONAL, INC. By: /s/ Desiree DeStefano By: /s/ Desiree DeStefano --------------------------------- ----------------------------------- Name: Desiree DeStefano Name: Desiree DeStefano Title: Vice President Title: Vice President O.W.D., INCORPORATED TUPPER LAKE PLASTICS, INCORPORATED By: /s/ Desiree DeStefano By: /s/ Desiree DeStefano --------------------------------- ----------------------------------- Name: Desiree DeStefano Name: Desiree DeStefano Title: Vice President Title: Vice President
EX-4.7 22 file021.txt REGISTRATION RIGHTS AGREEMENT EXECUTION COPY REGISTRATION RIGHTS AGREEMENT by and among Jarden Corporation The parties listed as guarantors hereto and Trienda Corporation, X Properties, LLC AND CIBC WORLD MARKETS CORP. BANC OF AMERICA SECURITIES LLC AS UNDERWRITERS DATED AS OF MAY 8, 2003 REGISTRATION RIGHTS AGREEMENT This Registration Rights Agreement (this "Agreement") is made and entered into as of May 8, 2003, by and among Jarden Corporation, a Delaware corporation (the "Company"), the guarantors listed on Schedule I attached hereto (each a "Guarantor" and, collectively, the "Guarantors"), Trienda Corporation, X Properties, LLC and CIBC World Markets Corp. and Banc of America Securities LLC, (each an "Underwriter" and, collectively, the "Underwriters"), each of whom has agreed to purchase the Company's 9 3/4% Senior Subordinated Notes due 2012 (the "Notes") pursuant to the Underwriting Agreement (as defined below). This Agreement is made pursuant to the Underwriting Agreement, dated as of May 1, 2003 (the "Underwriting Agreement"), by and among the Company, the Guarantors and the Underwriters (i) for the benefit of each Underwriter and (ii) for the benefit of the holders from time to time of the Notes (including you and each other Underwriter). In order to induce the Underwriters to purchase the Notes, the Company has agreed to provide the registration rights set forth in this Agreement. The execution and delivery of this Agreement is a condition to the obligations of the Underwriters set forth in Section 5(i) of the Underwriting Agreement. The parties hereby agree as follows: SECTION 1. DEFINITIONS As used in this Agreement, the following capitalized terms shall have the following meanings: Additional Interest Payment Date: With respect to the Notes, each Interest Payment Date. Closing Date: The date of this Agreement. Commission: The Securities and Exchange Commission. Consummate: A Registered Exchange Offer shall be deemed "Consummated" for purposes of this Agreement upon the occurrence of (i) the filing and effectiveness under the Securities Act of the Exchange Offer Registration Statement relating to the Exchange Notes to be issued in the Exchange Offer, (ii) the maintenance of such Exchange Offer Registration Statement continuously effective and the keeping of the Exchange Offer open for a period not less than the minimum period required pursuant to Section 3(b) hereof, and (iii) the delivery by the Company to the registrar under the 2002 Indenture of Exchange Notes in the same aggregate principal amount as the aggregate principal amount of Notes that were tendered by Holders thereof pursuant to the Exchange Offer. Exchange Act: The Securities Exchange Act of 1934, as amended. Exchange Notes: The 9 3/4% Senior Subordinated Notes due 2012, (CUSIP No. [020040 AB 7]) issued under the 2002 Indenture, substantially similar to the Notes, to be issued to Holders in exchange for the Notes pursuant to this Agreement. Exchange Offer: The exchange by the Company under the Securities Act of the Exchange Notes pursuant to which the Company offers the Holders of all outstanding Notes the opportunity to exchange all such outstanding Notes held by such Holders for 2002 Notes in an aggregate principal amount equal to the aggregate principal amount of the Notes tendered in such exchange offer by such Holders. Exchange Offer Registration Statement: The registration statement of the Company relating to the offering of Exchange Notes pursuant to the Exchange Offer, including the Prospectus included therein, all amendments and supplements thereto (including post-effective amendments) and all exhibits and material incorporated by reference therein. Existing Indenture: The indenture, dated as of January 29, 2003, between the Company and The Bank of New York, as trustee (the "Trustee"). Holders: As defined in Section 2(b) hereof. Indemnified Holder: As defined in Section 7(a) hereof. 2002 Indenture: The Indenture, dated as of April 24, 2002, among the Company, the Guarantors and The Bank of New York, as trustee (the "2002 Trustee"), pursuant to which the Company's $150.0 million of outstanding 9 3/4% senior Subordinated Notes due 2012 were issued and pursuant to which the Exchange Notes are to be issued, as such 2002 Indenture is amended or supplemented from time to time in accordance with the terms thereof. Indenture: The Existing Indenture, as supplemented by the first supplemental indenture among the Company, the Guarantors and the Trustee dated as of May 8, 2003. Initial Placement: The issuance and sale by the Company of the Notes to the Underwriters pursuant to the Underwriting Agreement. Interest Payment Date: As defined in the Indenture and the Notes. NASD: National Association of Securities Dealers, Inc. Notes: The 9 3/4% Senior Subordinated Notes due 2012 issued under the Indenture. Person: An individual, partnership, corporation, trust or unincorporated organization, or a government or agency or political subdivision thereof. Prospectus: The prospectus included in the Exchange Offer Registration Statement, as amended or supplemented by any prospectus supplement and by all other amendments thereto, including post-effective amendments, and all material incorporated by reference into such Prospectus. Record Holder: With respect to any Damages Payment Date relating to the Notes, each Person who is a Holder of Notes on the record date with respect to the Interest Payment Date on which such Damages Payment Date shall occur. Registration Default: As defined in Section 4 hereof. Securities Act: The Securities Act of 1933, as amended. Trust Indenture Act: The Trust Indenture Act of 1939 (15 U.S.C. Section 77aaa 77bbbb) as in effect on the date of the Indenture. SECTION 2. SECURITIES SUBJECT TO THIS AGREEMENT (a) The Notes. The securities entitled to the benefits of this Agreement are the Notes. (b) Holders. A Person is deemed to be a holder Notes (each, a "Holder") whenever such Person owns Notes. SECTION 3. REGISTERED EXCHANGE OFFER (a) The Company and the Guarantors shall (i) cause to be filed with the Commission the Exchange Offer Registration Statement under the Securities Act enabling Holders of the Notes to exchange the Notes for 2 registered notes issued under the 2002 Indenture, (ii) use commercially reasonable efforts to cause such Exchange Offer Registration Statement to become effective, (iii) in connection with the foregoing, file (A) all pre-effective amendments to such Exchange Offer Registration Statement as may be necessary in order to cause such Exchange Offer Registration Statement to become effective, (B) if applicable, a post-effective amendment to such Exchange Offer Registration Statement pursuant to Rule 430A under the Securities Act and (C) cause all necessary filings in connection with the registration and qualification of the Exchange Notes to be made under the Blue Sky laws of such jurisdictions as are necessary to permit Consummation of the Exchange Offer, and (iv) upon effectiveness of such Exchange Offer Registration Statement, commence the Exchange Offer. The Exchange Offer shall be on the appropriate form permitting registration of the Exchange Notes to be offered in exchange for the Notes. (b) The Company and the Guarantors shall cause the Exchange Offer Registration Statement to be effective continuously and shall keep the Exchange Offer open for a period of not less than the minimum period required under applicable federal and state securities laws to Consummate the Exchange Offer; provided, however, that in no event shall such period be less than 30 days after the date notice of the Exchange Offer is mailed to the Holders. The Company shall cause the Exchange Offer to comply with all applicable federal and state securities laws. No securities other than the Notes or any notes that may be issued under the 2002 Indenture (and permitted thereunder to be so included) shall be included in the Exchange Offer Registration Statement. The Company shall use commercially reasonable efforts to consummate the Exchange Offer within 365 days after the date hereof, provided that if the Company or any Guarantor files any other registration statement or otherwise offers securities pursuant to any registration statement then the Company and the Guarantors shall be required to file the Exchange Offer Registration Statement contemporaneously therewith, except for such registration statement on form S-8 (or any successor form or registration statement) or any registration statement that may be required under the Registration Rights Agreement dated as of April 24, 2002 executed and delivered in connection with the issuance of the $150.0 million of notes issued under the 2002 Indenture and outstanding on the date hereof or except if such offering is an equity offering and the underwriter for such equity offering reasonably believes the filing of the Exchange Offer Registration Statement is reasonably likely to have an adverse effect on the equity offering. SECTION 4. LIQUIDATED DAMAGES If the Company and the Guarantors (i) fail to consummate the Exchange Offer within 365 days after the date hereof; or (ii) fail to file the Exchange Offer Registration Statement, as required by Section 3(b) above, (each such event referred to in clauses (i) and (ii), a "Registration Default"), then the Company and the Guarantors hereby jointly and severally agree to pay to each Holder of Notes affected thereby liquidated damages in an amount equal to $.05 per week per $1,000 in principal amount of Notes held by such Holder for each week or portion thereof that the Registration Default continues for the first 90-day period immediately following the occurrence of such Registration Default. The amount of the liquidated damages shall increase by an additional $.05 per week per $1,000 in principal amount of Notes with respect to each subsequent 90-day period until all Registration Defaults have been cured, up to a maximum amount of liquidated damages of $.50 per week per $1,000 in principal amount of Notes. Following the cure of all Registration Defaults relating to any particular Notes, liquidated damages payable with respect to the Notes as a result of such clause (i) or (ii) shall cease. All obligations of the Company and the Guarantors set forth in the preceding paragraph that are outstanding with respect to any Note at the time such security ceases to exist and is exchanged for an Exchange Note shall survive until such time as all such obligations with respect to such security shall have been satisfied in full. Notwithstanding anything herein to the contrary, the occurrence of a Registration Default under Section 4 hereof shall not constitute a default and/or breach of this Agreement and shall solely give rise to the right of the Holders of the Notes to receive Liquidated Damages. 3 SECTION 5. REGISTRATION PROCEDURES In connection with the Exchange Offer, the Company and the Guarantors shall comply with all of the following provisions: (i) if in the reasonable opinion of counsel to the Company there is a question as to whether the Exchange Offer is permitted by applicable law, the Company and the Guarantors hereby agree to seek a no-action letter or other favorable decision from the Commission allowing the Company and the Guarantors to Consummate an Exchange Offer for such Notes. The Company and the Guarantors each hereby agrees to pursue the issuance of such a decision to the Commission staff level but shall not be required to take commercially unreasonable action to effect a change of Commission policy. The Company and the Guarantors each hereby agrees, however, to (A) participate in telephonic conferences with the Commission, (B) deliver to the Commission staff an analysis prepared by counsel to the Company setting forth the legal bases, if any, upon which such counsel has concluded that such an Exchange Offer should be permitted and (C) diligently pursue a favorable resolution by the Commission staff of such submission; (ii) use their commercially reasonable efforts to keep such Exchange Offer Registration Statement continuously effective and provide all requisite financial statements (including, if required by the Securities Act or any regulation thereunder, financial statements of the Guarantors for the period specified in Section 3 of this Agreement,) upon the occurrence of any event that would cause any such Exchange Offer Registration Statement or the Prospectus contained therein to contain a material misstatement or the Company shall file promptly an appropriate amendment to such Exchange Offer Registration Statement correcting any such misstatement or omission and use its commercially reasonable efforts to cause such amendment to be declared effective and such Exchange Offer Registration Statement and the related Prospectus to become usable for their intended purpose(s) as soon as practicable thereafter; (iii) prepare and file with the Commission such amendments and post-effective amendments to the Exchange Offer Registration Statement as may be necessary to keep the Exchange Offer Registration Statement effective for the applicable period set forth in Section 3 hereof; cause the Prospectus to be supplemented by any required Prospectus supplement, and as so supplemented to be filed pursuant to Rule 424 under the Securities Act, and to comply fully with the applicable provisions of Rules 424 and 430A under the Securities Act in a timely manner; (iv) use their commercially reasonable efforts to obtain the withdrawal or lifting of any stop order suspending the effectiveness of the Exchange Offer Registration Statement, or of any order issued from any state securities commission or other regulatory authority suspending the qualification or exemption from qualification of the Notes under state securities or Blue Sky laws, at the earliest possible time; (v) furnish without charge to each of the Underwriters before filing with the Commission, copies of the Exchange Offer Registration Statement or any Prospectus included therein or any amendments or supplements to any such Exchange Offer Registration Statement or Prospectus (including all documents incorporated by reference after the initial filing of such Exchange Offer Registration Statement), which documents will be subject to the review of such Underwriters for a period of at least three business days, and the Company will not file any such Exchange Offer Registration Statement or Prospectus or any amendment or supplement to any such Exchange Offer Registration Statement or Prospectus (including all such documents incorporated by reference) to which an Underwriter shall reasonably object in writing within five business days after the receipt thereof (such objection to be deemed timely made upon confirmation of telecopy transmission within such period). The objection of an Underwriters shall be deemed to be reasonable if such Exchange Offer Registration Statement, amendment, Prospectus or supplement, as applicable, as proposed to be filed, contains a material misstatement or omission; (vi) make available at reasonable times for inspection by the Underwriters and any attorney or accountant retained by such Underwriters, all financial and other records, pertinent corporate documents and properties of the Company and the Guarantors and cause the Company's and the Guarantors' 4 officers, directors and employees to supply all information reasonably requested by any such Underwriter, attorney or accountant in connection with such Exchange Offer Registration Statement subsequent to the filing thereof and prior to its effectiveness; (vii) prior to the exchange of the Notes, cooperate with, and cause the Guarantors to cooperate with, the Holders, and their respective counsel in connection with the registration and qualification of the Notes under the securities or Blue Sky laws of such jurisdictions as the Holders may request; provided, however, that neither the Company nor the Guarantors shall be required to register or qualify as a foreign corporation where it is not then so qualified or to take any action that would subject it to the service of process in suits or to taxation, other than as to matters and transactions relating to the Exchange Offer Registration Statement, in any jurisdiction where it is not then so subject; (viii) provide the 2002 Trustee under the 2002 Indenture with printed certificates for the Exchange Notes which are in a form eligible for deposit with the Depositary Trust Company; and (ix) otherwise use their commercially reasonable efforts to comply with all applicable rules and regulations of the Commission, and make generally available to its security holders upon request, as soon as practicable, a consolidated earnings statement meeting the requirements of Rule 158 (which need not be audited) for the twelve-month period beginning with the first month of the Company's first fiscal quarter commencing after the effective date of the Exchange Offer Registration Statement. The Company, the Guarantors, Trienda Corporation and X Properties, LLC acknowledge and agree that the Exchange Notes to be issued in connection with the Exchange Offer shall be guaranteed by Trienda Corporation and X Properties, LLC unless at such time they are no longer guarantors of the notes issued and to be issued under the 2002 Indenture. SECTION 6. REGISTRATION EXPENSES (a) All expenses incident to the Company's or the Guarantors' performance of or compliance with this Agreement will be borne by the Company or the Guarantors, regardless of whether the Exchange Offer Registration Statement becomes effective, including without limitation: (i) all registration and filing fees and expenses of the Company; (ii) all fees and expenses of compliance with federal securities and state Blue Sky or securities laws; (iii) all expenses of printing (including printing certificates for the Exchange Notes to be issued in the Exchange Offer and printing of Prospectuses), messenger and delivery services and telephone; (iv) all fees and disbursements of counsel for the Company, the Guarantors and, subject to Section 6(b) below, the Holders of Notes; (v) all application and filing fees in connection with listing the Exchange Notes on a national securities exchange or automated quotation system pursuant to the requirements thereof; and (vi) all fees and disbursements of independent certified public accountants of the Company and the Guarantors (including the expenses of any special audit and comfort letters required by or incident to such performance). The Company will, in any event, bear its and the Guarantors' internal expenses (including, without limitation, all salaries and expenses of its officers and employees performing legal or accounting duties), the expenses of any annual audit and the fees and expenses of any Person, including special experts, retained by the Company or the Guarantors. (b) In connection with the Exchange Offer Registration Statement, the Company and the Guarantors will reimburse the Underwriters and the Holders of Notes being tendered in the Exchange Offer for the reasonable fees and disbursements of not more than one counsel, who shall be Latham & Watkins LLP or such other counsel as may be chosen by the Holders of a majority in principal amount of the Notes for whose benefit such Exchange Offer Registration Statement is being prepared. 5 SECTION 7. INDEMNIFICATION (a) The Company agrees and the Guarantors, jointly and severally, agree to indemnify and hold harmless (i) each Holder and (ii) each person, if any, who controls (within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act) any Holder (any of the persons referred to in this clause (ii) being hereinafter referred to as a "controlling person") and (iii) the respective officers, directors, partners, employees, representatives and agents of any Holder or any controlling person (any person referred to in clause (i), (ii) or (iii) may hereinafter be referred to as an "Indemnified Holder"), to the fullest extent lawful, from and against any and all losses, claims, damages, liabilities, judgments, actions and expenses (including without limitation and as incurred, reimbursement of all reasonable costs of investigating, preparing, pursuing, settling, compromising, paying or defending any claim or action, or any investigation or proceeding by any governmental agency or body, commenced or threatened, including the reasonable fees and expenses of counsel to any Indemnified Holder), joint or several, directly or indirectly caused by, related to, based upon, arising out of or in connection with any untrue statement or alleged untrue statement of a material fact contained in any Exchange Offer Registration Statement or Prospectus (or any amendment or supplement thereto), or any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, except insofar as such losses, claims, damages, liabilities or expenses are caused by an untrue statement or omission or alleged untrue statement or omission that is made in reliance upon and in conformity with information relating to any of the Holders furnished in writing to the Company by any of the Holders expressly for use therein. This indemnity agreement shall be in addition to any liability which the Company may otherwise have. In case any action or proceeding (including any governmental or regulatory investigation or proceeding) shall be brought or asserted against any of the Indemnified Holders with respect to which indemnity may be sought against the Company or the Guarantors, such Indemnified Holder (or the Indemnified Holder controlled by such controlling person) shall promptly notify the Company and the Guarantors in writing (provided, that the failure to give such notice shall not relieve the Company or the Guarantors of their respective obligations pursuant to this Agreement). Such Indemnified Holder shall have the right to employ its own counsel in any such action and the reasonable fees and expenses of such counsel shall be paid, as incurred, by the Company and the Guarantors (regardless of whether it is ultimately determined that an Indemnified Holder is not entitled to indemnification hereunder). The Company and the Guarantors shall not, in connection with any one such action or proceeding or separate but substantially similar or related actions or proceedings in the same jurisdiction arising out of the same general allegations or circumstances, be liable for the reasonable fees and expenses of more than one separate firm of attorneys (in addition to any local counsel) at any time for such Indemnified Holders, which firm shall be designated by the Holders. The Company shall be liable for any settlement of any such action or proceeding effected with the Company's prior written consent, which consent shall not be withheld unreasonably, and the Company agrees to indemnify and hold harmless any Indemnified Holder from and against any loss, claim, damage, liability or expense by reason of any settlement of any action effected with the written consent of the Company. The Company shall not, without the prior written consent of each Indemnified Holder, settle or compromise or consent to the entry of judgment in or otherwise seek to terminate any pending or threatened action, claim, litigation or proceeding in respect of which indemnification or contribution may be sought hereunder (whether or not any Indemnified Holder is a party thereto), unless such settlement, compromise, consent or termination includes an unconditional release of each Indemnified Holder from all liability arising out of such action, claim, litigation or proceeding. (b) Each Holder of Notes agrees, severally and not jointly, to indemnify and hold harmless the Company and the Guarantors and their respective directors, officers of the Company who sign the Exchange Offer Registration Statement, and any person controlling (within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act) the Company, and the respective officers, directors, partners, employees, representatives and agents of each such person, to the same extent as the foregoing indemnity from the Company and the Guarantors to each of the Indemnified Holders, but only with respect to claims and actions based on information relating to such Holder furnished in writing by such Holder expressly for use in any Exchange Offer Registration Statement. In case any action or proceeding shall be brought against the Company or its directors or officers or any such controlling person in respect of which indemnity may be sought against a Holder of Notes, 6 such Holder shall have the rights and duties given the Company and the Company or its directors or officers or such controlling person shall have the rights and duties given to each Holder by the preceding paragraph. In no event shall the liability of any Holder hereunder be greater in amount than the dollar amount of the proceeds received by such Holder upon the sale of the Securities giving rise to such indemnification obligation. (c) If the indemnification provided for in this Section 7 is unavailable to an indemnified party under Section 7(a) or Section 7(b) hereof (other than by reason of exceptions provided in those Sections) in respect of any losses, claims, damages, liabilities, judgments, actions or expenses referred to therein, then each applicable indemnifying party, in lieu of indemnifying such indemnified party, shall contribute to the amount paid or payable by such indemnified party as a result of such losses, claims, damages, liabilities or expenses in such proportion as is appropriate to reflect the relative benefits received by the Company and the Guarantors, on the one hand, and the Holders, on the other hand, from the Initial Placement (which in the case of the Company shall be deemed to be equal to the total net proceeds from the Initial Placement as set forth in the "Use of Proceeds" section of the offering memorandum prepared in connection with the Initial Placement and the liquidated damages which did not become payable as a result of the filing of the Exchange Offer Registration Statement resulting in such losses, claims, damages, liabilities, judgments actions or expenses) and such Exchange Offer Registration Statement, or if such allocation is not permitted by applicable law, the relative fault of the Company and the Guarantors on the one hand, and of the Indemnified Holder, on the other hand, in connection with the statements or omissions which resulted in such losses, claims, damages, liabilities or expenses, as well as any other relevant equitable considerations. The relative fault of the Company and the Guarantors on the one hand and of the Indemnified Holder on the other shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the Company or the Guarantors or by the Indemnified Holder and the parties' relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission. The amount paid or payable by a party as a result of the losses, claims, damages, liabilities and expenses referred to above shall be deemed to include, subject to the limitations set forth in the second paragraph of Section 7(a), any legal or other fees or expenses reasonably incurred by such party in connection with investigating or defending any action or claim. The Company, the Guarantors and each Holder of Notes agree that it would not be just and equitable if contribution pursuant to this Section 7(c) were determined by pro rata allocation (even if the Holders were treated as one entity for such purpose) or by any other method of allocation which does not take account of the equitable considerations referred to in the immediately preceding paragraph. The amount paid or payable by an indemnified party as a result of the losses, claims, damages, liabilities or expenses referred to in the immediately preceding paragraph shall be deemed to include, subject to the limitations set forth above, any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any such action or claim. Notwithstanding the provisions of this Section 7, none of the Holders (and its related Indemnified Holders) shall be required to contribute, in the aggregate, any amount in excess of the amount by which the total discount received by such Holder with respect to the Initial Notes exceeds the amount of any damages which such Holder has otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. The Holders' obligations to contribute pursuant to this Section 7(c) are several in proportion to the respective principal amount of Initial Notes held by each of the Holders hereunder and not joint. SECTION 8. MISCELLANEOUS (a) Remedies. Except to the extent set forth in Section 4 above, the Company and the Guarantors each hereby agrees that monetary damages would not be adequate compensation for any loss incurred by reason of a breach by it of the provisions of this Agreement and hereby agree to waive the defense in any action for specific performance that a remedy at law would be adequate. (b) No Inconsistent Agreements. The Company will not, and will cause the Guarantors not to, on or after the date of this Agreement enter into any agreement with respect to its securities that is materially 7 inconsistent with the rights granted to the Holders in this Agreement. The rights granted to the Holders hereunder do not in any way conflict with and are not inconsistent with the rights granted to the holders of the Company's securities under any agreement in effect on the date hereof. (c) Amendments and Waivers. The provisions of this Agreement may not be amended, modified or supplemented, and waivers or consents to or departures from the provisions hereof may not be given unless the Company has obtained the written consent of Holders of a majority of the outstanding principal amount of Notes. Notwithstanding the foregoing, a waiver or consent to departure from the provisions hereof that relates exclusively to the rights of Holders whose securities are being tendered pursuant to the Exchange Offer and that does not affect directly or indirectly the rights of other Holders whose securities are not being tendered pursuant to such Exchange Offer may be given by the Holders of a majority of the outstanding principal amount of Notes being tendered or registered; provided that, with respect to any matter that directly or indirectly affects the rights of any Underwriter hereunder, the Company shall obtain the written consent of each such Underwriter with respect to which such amendment, qualification, supplement, waiver, consent or departure is to be effective. (d) Additional Guarantors. The Company shall cause any of its Domestic Subsidiaries (as defined in the Indenture) that becomes, prior to the consummation of the Exchange Offer, Guarantors in accordance with the terms and provisions of the Indenture to become a party to this Agreement as a Guarantor. It is understood and agreed that if, prior to the Exchange Offer, a Guarantor that has executed this Agreement is no longer a Guarantor under the Indenture and is no longer a guarantor of the notes under the 2002 Indenture, in each case, pursuant to and in accordance with the provisions of the Indenture and the 2002 Indenture, such Guarantor shall no longer be a Guarantor for purposes of this Agreement. (e) Notices. All notices and other communications provided for or permitted hereunder shall be made in writing by hand-delivery, first-class mail (registered or certified, return receipt requested), telex, telecopier, or air courier guaranteeing overnight delivery: (i) if to a Holder, at the address set forth on the records of the Registrar under the Indenture, with a copy to the Registrar under the Indenture; and (ii) if to the Company or the Guarantors: Jarden Corporation Suite B-302 555 Theodore Fremd Avenue Rye, NY 10580 Facsimile: (914) 967-9405 Attention: Ian G.H. Ashken With a copy to: Kane Kessler, P.C. 1350 Avenue of the Americas, 26th Floor New York, NY 10019 Facsimile: (212) 245-3009 Attention: Robert L. Lawrence All such notices and communications shall be deemed to have been duly given: at the time delivered by hand, if personally delivered; five business days after being deposited in the mail, postage prepaid, if mailed; when answered back, if telexed; when receipt acknowledged, if telecopied; and on the next business day, if timely delivered to an air courier guaranteeing overnight delivery. 8 Copies of all such notices, demands or other communications shall be concurrently delivered by the Person giving the same to the Trustee at the address specified in the Indenture. (f) Successors and Assigns. This Agreement shall inure to the benefit of and be binding upon the successors and assigns of each of the parties, including without limitation and without the need for an express assignment, subsequent Holders of Notes; provided, however, that this Agreement shall not inure to the benefit of or be binding upon a successor or assign of a Holder unless and to the extent such successor or assign acquired Notes from such Holder. (g) Counterparts. This Agreement may be executed in any number of counterparts and by the parties hereto in separate counterparts, each of which when so executed shall be deemed to be an original and all of which taken together shall constitute one and the same agreement. (h) Headings. The headings in this Agreement are for convenience of reference only and shall not limit or otherwise affect the meaning hereof. (i) GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO THE CONFLICT OF LAW RULES THEREOF. (j) Severability. In the event that any one or more of the provisions contained herein, or the application thereof in any circumstance, is held invalid, illegal or unenforceable, the validity, legality and enforceability of any such provision in every other respect and of the remaining provisions contained herein shall not be affected or impaired thereby. (k) Entire Agreement. This Agreement together with the Underwriting Agreement, the DTC Agreement, the Notes, the Guarantees and the Indenture (each as defined in the Underwriting Agreement) is intended by the parties as a final expression of their agreement and intended to be a complete and exclusive statement of the agreement and understanding of the parties hereto in respect of the subject matter contained herein. There are no restrictions, promises, warranties or undertakings, other than those set forth or referred to herein with respect to the registration rights granted by the Company with respect to the Notes. This Agreement supersedes all prior agreements and understandings between the parties with respect to such subject matter. (l) Information by Holders. No Holder of Notes may include its Notes in the Exchange Offer Registration Statement unless and until such Holder furnishes to the Company, within 20 business days after receipt of a request therefor, such information regarding such Holders and Notes held by them as a Company may reasonably request in writing; provided that such information is required to be included in such Exchange Offer Registration Statement or otherwise filed in order to effect any registration, qualification or compliance with state securities laws in accordance with Section 5 hereof. It being understood that Holders who are institutional investors shall not be required to provide such information. 9 IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first written above. JARDEN CORPORATION By: /s/ Desiree DeStefano --------------------------------- Name: Desiree DeStefano Title: Senior Vice President ALLTRISTA NEWCO CORPORATION By: /s/ Desiree DeStefano --------------------------------- Name: Desiree DeStefano Title: Vice President QUOIN CORPORATION By: /s/ Desiree DeStefano --------------------------------- Name: Desiree DeStefano Title: Vice President HEARTHMARK, INC. By: /s/ Desiree DeStefano --------------------------------- Name: Desiree DeStefano Title: Vice President ALLTRISTA PLASTICS CORPORATION By: /s/ Desiree DeStefano --------------------------------- Name: Desiree DeStefano Title: Vice President 10 ALLTRISTA ZINC PRODUCTS, L.P. By: Alltrista Newco Corporation, its General Partner By: /s/ Desiree DeStefano --------------------------------- Name: Desiree DeStefano Title: Vice President TILIA, INC. By: /s/ Desiree DeStefano --------------------------------- Name: Desiree DeStefano Title: Vice President TILIA DIRECT, INC. By: /s/ Desiree DeStefano --------------------------------- Name: Desiree DeStefano Title: Vice President TILIA INTERNATIONAL, INC. By: /s/ Desiree DeStefano --------------------------------- Name: Desiree DeStefano Title Vice President TRIENDA CORPORATION By: /s/ Desiree DeStefano --------------------------------- Name: Desiree DeStefano Title: Vice President X PROPERTIES, LLC By: /s/ Desiree DeStefano --------------------------------- Name: Desiree DeStefano Title: Vice President 11 The foregoing Registration Rights Agreement is hereby confirmed and accepted as of the date first above written. CIBC WORLD MARKETS CORP. BANC OF AMERICA SECURITIES LLC BY: CIBC WORLD MARKETS CORP. By: /s/ Pete Mejlander -------------------- Pete Mejlander SCHEDULE I GUARANTORS Alltrista Newco Corporation Quoin Corporation Hearthmark, Inc.* Alltrista Plastics Corporation** Alltrista Zinc Products, L.P.*** Tilia, Inc. Tilia Direct, Inc. Tilia International, Inc. * (DBA) Alltrista Consumer Products Company ** (DBA) Alltrista Unimark Plastics Company and Alltrista Industrial Plastics Company *** (DBA) Alltrista Zinc Products Company 2 EX-5.1 23 file022.txt OPINION OF KANE KESSLER, P.C. KANE KESSLER, P.C. 1350 Avenue of the Americas New York, NY 10019 (212) 541-6222 Fax: (212) 245-3009 September 25, 2003 Jarden Corporation 555 Theodore Fremd Avenue Rye, New York 10580 RE: REGISTRATION STATEMENT ON FORM S-3 OF JARDEN CORPORATION Ladies and Gentlemen: We have acted as special counsel to Jarden Corporation, a Delaware corporation in connection the Company's offering of up to a maximum of 3,220,000 shares of Common Stock, par value $.01 per share (the "Common Stock") of the Company, which includes 420,000 shares of Common Stock which may be purchased by the underwriters pursuant to an over-allotment option, under the Registration Statement (the "Registration Statement") on Form S-3 (Reg. No. 333-102387) filed on behalf of the Company with the Securities and Exchange Commission (the "Commission") under the Securities Act of 1933 (the "1933 Act"). The Registration Statement provides for the offering, issuance and sale from time to time of the securities described in the Registration Statement at an aggregate initial offering price that will not exceed $150,000,000. This opinion updates and supplements our opinions dated January 29, 2003 and May 7, 2003, each filed as an exhibit to the Registration Statement. This opinion is being furnished to you for filing on a Current Report on Form 8-K of the Company and incorporation by reference as Exhibit 5.1 to the Registration Statement. In our capacity as counsel to the Company in connection with the matters referred to above, we have examined copies of the following: (i) the Restated Certificate of Incorporation of the Company, as amended, the By-laws of the Company, and records of certain of the Company's corporate proceedings as reflected in its minute books; (ii) the Registration Statement, in the form filed with the Commission through the date hereof; and (iii) the supplemental prospectus to the Registration Statement, dated September 8, 2003, filed with the Jarden Corporation Page 2 Commission on September 9, 2003, pursuant to Rule 424(b)(5) of the Act (the "September Prospectus Supplement"). We have also examined such other documents, papers, authorities and statutes as we have deemed necessary to form the basis of the opinions hereinafter set forth. In our examination, we have assumed the legal capacity of all natural persons, the genuineness of all signatures, the authenticity of all documents submitted to us as originals, the conformity to original documents of all documents submitted to us as certified or photostatic copies, and the authenticity of the originals of such documents. As to certain facts material to this opinion, we have relied upon oral or written statements and representations of officers and other representatives of the Company and public officials, and such other documents and information as we have deemed necessary or appropriate to enable us to render the opinions expressed below. We have not undertaken any independent investigation to determine the accuracy of any such facts. Based upon and subject to the foregoing and the statements contained herein, we are of the opinion that the Common Stock proposed to be sold by the Company, when duly sold, issued and paid for pursuant to, and in the manner contemplated by, the September Prospectus Supplement included as part of the Registration Statement, will be duly authorized, validly issued, fully paid and non-assessable. We hereby consent to the filing of this opinion as Exhibit 5.1 to the Company's Current Report on Form 8-K to be filed with the Commission on or about September 26, 2003, to the incorporation by reference of this opinion into the Registration Statement and to the reference to us under the heading "Legal Matters" in the Prospectus and the Prospectus Supplement which form a part thereof. In giving this consent, we do not admit that we are in the category of persons whose consent is required under Section 7 of the Act or the rules and regulations of the Securities and Exchange Commission promulgated thereunder. We are qualified to practice law in the State of New York and do not purport to be experts on any law, other than the laws of the State of New York, the General Corporation Law of the State of Delaware and the federal law of the United States. This opinion letter is limited to the specific legal matters expressly set forth herein, speaks only as of the date hereof and is limited to present statutes, regulations and administrative and judicial interpretations. Very truly yours, KANE KESSLER, P.C. By: /s/ Robert L. Lawrence ------------------------------------- EX-10.1 24 file023.txt RESTRICTED STOCK AWARD AGREEMENT JARDEN CORPORATION RESTRICTED STOCK AGREEMENT This AGREEMENT, dated as of the 8th day of May, 2003, by and between Jarden Corporation, a Delaware corporation (the "Corporation"), and Martin E. Franklin (the "Restricted Stockholder"). W I T N E S S E T H : WHEREAS, the Restricted Stockholder is an employee of the Corporation; WHEREAS, the Corporation wishes to provide the Restricted Stockholder with an opportunity to increase his participation in the ownership of the Corporation and its future growth through the grant of an opportunity to acquire common stock of the Corporation, $.01 par value per share (the "Common Stock"); and WHEREAS, with respect to the Restricted Stockholder's employment, his performance can be measured, in part, by the per share stock price of the Common Stock. NOW THEREFORE, in consideration of the mutual agreements herein contained, the parties hereto agree as follows: 1. GRANT OF RESTRICTED SHARES. (a) Pursuant to the provisions of the Jarden Corporation 2003 Stock Incentive Plan (the "Plan"), effective as of May 8, 2003 (the "Date of Grant"), the Corporation hereby grants to the Restricted Stockholder 150,000 shares of Common Stock (the "Restricted Shares"), subject to all of the terms and conditions of this Agreement and the Plan. As more fully described below, the Restricted Shares are subject to forfeiture by the Restricted Stockholder if certain criteria are not satisfied. (b) All capitalized terms used herein but not defined shall have the meanings given to such terms in the Plan. 2. VESTING PERIOD. (a) Vesting. The Restricted Shares shall vest and become nonforfeitable upon the earlier of: (i) the date that the per share stock price of the Common Stock equals or exceeds forty dollars ($40.00), subject to adjustment pursuant to Section 18.4 of the Plan or as otherwise mutually agreed in writing between the parties; or (ii) the date there is a Change-of-Control Event of the Company. (b) Termination of Employment other than as a Result of Death. If the Restricted Stockholder's employment with the Corporation is terminated, other than by the Corporation without Cause or by the death or Disability of the Restricted Stockholder, prior to the satisfaction of the vesting provisions set forth in Section 2(a) hereof, no further portion of his or her Restricted Shares shall become vested pursuant to this Agreement and such unvested Restricted Shares shall be forfeited effective as of the date that the Restricted Stockholder's employment with the Corporation is terminated. (c) Termination of Employment as a Result of Death or Disability. If the Restricted Stockholder ceases to be an employee of the Corporation because of his or her death or Disability prior to the satisfaction of the vesting provisions set forth in Section 2 hereof, notwithstanding anything to the contrary contained in the Stockholders Agreement or otherwise, all unvested Restricted Shares shall become vested and nonforfeitable automatically as of the date of the Restricted Stockholder's death or Disability. 3. NON-TRANSFERABILITY. Until the Restricted Shares shall be vested and until the satisfaction of any and all other conditions specified herein, the Restricted Shares may not be sold, transferred, assigned, pledged or otherwise encumbered or disposed of by the Restricted Stockholder, except upon the written consent of the Committee. 4. NO RIGHT TO CONTINUED EMPLOYMENT. Nothing in this Agreement shall confer upon the Restricted Stockholder any right with respect to continuance of employment by the Corporation, nor shall it interfere in any way with the right of Corporation to terminate the Restricted Stockholder's employment at any time. THIS AGREEMENT DOES NOT CONSTITUTE AN EMPLOYMENT CONTRACT. THIS AGREEMENT DOES NOT GUARANTEE EMPLOYMENT FOR THE LENGTH OF TIME OF THE VESTING PERIOD OR FOR ANY PORTION THEREOF. 5. RESTRICTED STOCKHOLDER BOUND BY PLAN. The Restricted Stockholder hereby acknowledges receipt of a copy of the Plan and agrees to be bound by all the terms and provisions thereof. In the event of any conflict between the provisions of this Agreement and the provisions of the Plan, the provisions of this Agreement shall control. The Restricted Stockholder agrees to accept as binding, conclusive, and final all decisions or interpretations of the Committee upon any questions arising under the Plan. 6. SECTION 83(b) ELECTION. If the Restricted Stockholder files an election with the Internal Revenue Service to include the Fair Market Value of any Restricted Shares in gross income as of the Date of Grant, the Restricted Stockholder agrees to promptly furnish the Corporation with a copy of such election, together with the amount of any federal, state, local or other taxes required to be withheld to enable the Corporation to claim an income tax deduction with respect to such election. 7. RIGHTS AS STOCKHOLDER. So long as the Restricted Shares are not forfeited pursuant to Section 2(b) hereof, the Restricted Stockholder shall have certain rights as holder of Common Stock with respect to Restricted Shares, including the right to vote and the right to receive dividends, if any, subject, however to the terms, conditions, and restrictions described in this Agreement or the Plan. Notwithstanding the preceding sentence, the Company will hold the certificate representing the Restricted Shares awarded until the vesting provisions set forth in Section 2(a) hereof have been satisfied. 8. WITHHOLDING TAXES. The Restricted Shares will be subject to any federal, state, or local taxes of any kind required by law at the time the Restricted Shares vest and become nonforfeitable. By accepting the Restricted Shares, the Restricted Stockholder agrees to satisfy federal, state and local withholding requirements prior to the delivery of any certificate or certificates for such Restricted Shares by one of the following methods: (i) writing a check to the Company equal to the required withholding amount or (ii) electing, in writing, to have the Company retain a number of Restricted Shares having a Fair Market Value equal to the minimum amount required to be withheld, determined on the date that the amount of tax to be withheld is to be determined. 9. NOTICES. Any notice required to be given or delivered to the Company under the terms of this Agreement shall be in writing and addressed to the Corporate Secretary of the Company at its principal corporate offices at 555 Theodore Fremd Avenue, Rye, New York 10580. Any notice required to be given or delivered to the Restricted Stockholder shall be in writing and addressed to the Restricted Stockholder at the address shown beneath such Restricted Stockholder's name on the signature page attached hereto or to such other address as such party may designate in writing from time to time to the Company. All notices shall be deemed to have been given or delivered upon: personal delivery; three (3) days after deposit in the United States mail by certified or registered mail (return receipt requested); one (1) business day after deposit with any return receipt express courier (prepaid); or one (1) business day after transmission by facsimile. (signature page follows) IN WITNESS WHEREOF, the Corporation has caused this Agreement to be executed by a duly authorized officer and the Restricted Stockholder has executed this Agreement as of the 8th day of May, 2003. JARDEN CORPORATION By: /s/ Ian G.H. Ashken -------------------- Name: Ian G.H. Ashken Title: Vice Chairman, Chief Financial Officer, and Secretary RESTRICTED STOCKHOLDER /s/ Martin E. Franklin ---------------------- Name: Martin E. Franklin Address: 62 Rye Ridge Rd Harrison, NY 10528 EX-10.2 25 file024.txt AMND. 1 TO RSTR. STCK AWRD AGR. MARTIN E. FRANKLIN AMENDMENT NO. 1 TO RESTRICTED STOCK AWARD AGREEMENT THIS Amendment (the "Amendment"), dated as of September 4, 2003, to the Restricted Stock Award Agreement, dated May 8, 2003, is entered into between Jarden Corporation, a Delaware corporation (the "Company") and Martin E. Franklin, (the "Employee"). WITNESSETH: WHEREAS, the Employee and the Company are parties to that certain Restricted Stock Award Agreement dated May 8, 2003, (the "Agreement"); and WHEREAS, the parties mutually desire to amend the Agreement on the terms and conditions set forth more fully below. NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth in this Amendment, the Company and the Employee hereby agree as follows: 1. Section 2.a.(i) of the Agreement is hereby amended and restated to read as follows: "(i) the date that the per share stock price of the Common Stock equals or exceeds forty-two dollars ($42.00), subject to adjustment pursuant to Section 18.4 of the Plan or as otherwise mutually agreed in writing between the parties (for purposes of clarity, the term "stock price" above means the closing stock price of the Common Stock); or" 2. Except as expressly amended by this Amendment, the Agreement shall remain in full force and effect as the same was in effect immediately prior to the effectiveness of this Agreement. IN WITNESS WHEREOF, each of the parties hereto has duly executed this Agreement as of the date set forth above. JARDEN CORPORATION By: /s/ Ian G.H. Ashken ----------------------------- Name: Ian G.H. Ashken Title: Vice Chairman, Chief Financial Officer, and Secretary /s/ Martin E. Franklin -------------------------------- Martin E. Franklin EX-10.3 26 file025.txt RESTRICTED STOCK AWARD AGREEMENT JARDEN CORPORATION RESTRICTED STOCK AGREEMENT This AGREEMENT, dated as of the 8th day of May, 2003, by and between Jarden Corporation, a Delaware corporation (the "Corporation"), and Ian G.H. Ashken (the "Restricted Stockholder"). W I T N E S S E T H : WHEREAS, the Restricted Stockholder is an employee of the Corporation; WHEREAS, the Corporation wishes to provide the Restricted Stockholder with an opportunity to increase his participation in the ownership of the Corporation and its future growth through the grant of an opportunity to acquire common stock of the Corporation, $.01 par value per share (the "Common Stock"); and WHEREAS, with respect to the Restricted Stockholder's employment, his performance can be measured, in part, by the per share stock price of the Common Stock. NOW THEREFORE, in consideration of the mutual agreements herein contained, the parties hereto agree as follows: 1. GRANT OF RESTRICTED SHARES. (a) Pursuant to the provisions of the Jarden Corporation 2003 Stock Incentive Plan (the "Plan"), effective as of May 8, 2003 (the "Date of Grant"), the Corporation hereby grants to the Restricted Stockholder 50,000 shares of Common Stock (the "Restricted Shares"), subject to all of the terms and conditions of this Agreement and the Plan. As more fully described below, the Restricted Shares are subject to forfeiture by the Restricted Stockholder if certain criteria are not satisfied. (b) All capitalized terms used herein but not defined shall have the meanings given to such terms in the Plan. 2. VESTING PERIOD. (a) Vesting. The Restricted Shares shall vest and become nonforfeitable upon the earlier of: (i) the date that the per share stock price of the Common Stock equals or exceeds forty dollars ($40.00), subject to adjustment pursuant to Section 18.4 of the Plan or as otherwise mutually agreed in writing between the parties; or (ii) the date there is a Change-of-Control Event of the Company. (b) Termination of Employment other than as a Result of Death. If the Restricted Stockholder's employment with the Corporation is terminated, other than by the Corporation without Cause or by the death or Disability of the Restricted Stockholder, prior to the satisfaction of the vesting provisions set forth in Section 2(a) hereof, no further portion of his or her Restricted Shares shall become vested pursuant to this Agreement and such unvested Restricted Shares shall be forfeited effective as of the date that the Restricted Stockholder's employment with the Corporation is terminated. (c) Termination of Employment as a Result of Death or Disability. If the Restricted Stockholder ceases to be an employee of the Corporation because of his or her death or Disability prior to the satisfaction of the vesting provisions set forth in Section 2 hereof, notwithstanding anything to the contrary contained in the Stockholders Agreement or otherwise, all unvested Restricted Shares shall become vested and nonforfeitable automatically as of the date of the Restricted Stockholder's death or Disability. 3. NON-TRANSFERABILITY. Until the Restricted Shares shall be vested and until the satisfaction of any and all other conditions specified herein, the Restricted Shares may not be sold, transferred, assigned, pledged or otherwise encumbered or disposed of by the Restricted Stockholder, except upon the written consent of the Committee. 4. NO RIGHT TO CONTINUED EMPLOYMENT. Nothing in this Agreement shall confer upon the Restricted Stockholder any right with respect to continuance of employment by the Corporation, nor shall it interfere in any way with the right of Corporation to terminate the Restricted Stockholder's employment at any time. THIS AGREEMENT DOES NOT CONSTITUTE AN EMPLOYMENT CONTRACT. THIS AGREEMENT DOES NOT GUARANTEE EMPLOYMENT FOR THE LENGTH OF TIME OF THE VESTING PERIOD OR FOR ANY PORTION THEREOF. 5. RESTRICTED STOCKHOLDER BOUND BY PLAN. The Restricted Stockholder hereby acknowledges receipt of a copy of the Plan and agrees to be bound by all the terms and provisions thereof. In the event of any conflict between the provisions of this Agreement and the provisions of the Plan, the provisions of this Agreement shall control. The Restricted Stockholder agrees to accept as binding, conclusive, and final all decisions or interpretations of the Committee upon any questions arising under the Plan. 6. SECTION 83(B) ELECTION. If the Restricted Stockholder files an election with the Internal Revenue Service to include the Fair Market Value of any Restricted Shares in gross income as of the Date of Grant, the Restricted Stockholder agrees to promptly furnish the Corporation with a copy of such election, together with the amount of any federal, state, local or other taxes required to be withheld to enable the Corporation to claim an income tax deduction with respect to such election. 7. RIGHTS AS STOCKHOLDER. So long as the Restricted Shares are not forfeited pursuant to Section 2(b) hereof, the Restricted Stockholder shall have certain rights as holder of Common Stock with respect to Restricted Shares, including the right to vote and the right to receive dividends, if any, subject, however to the terms, conditions, and restrictions described in this Agreement or the Plan. Notwithstanding the preceding sentence, the Company will hold the certificate representing the Restricted Shares awarded until the vesting provisions set forth in Section 2(a) hereof have been satisfied. 8. WITHHOLDING TAXES. The Restricted Shares will be subject to any federal, state, or local taxes of any kind required by law at the time the Restricted Shares vest and become nonforfeitable. By accepting the Restricted Shares, the Restricted Stockholder agrees to satisfy federal, state and local withholding requirements prior to the delivery of any certificate or certificates for such Restricted Shares by one of the following methods: (i) writing a check to the Company equal to the required withholding amount or (ii) electing, in writing, to have the Company retain a number of Restricted Shares having a Fair Market Value equal to the minimum amount required to be withheld, determined on the date that the amount of tax to be withheld is to be determined. 9. NOTICES. Any notice required to be given or delivered to the Company under the terms of this Agreement shall be in writing and addressed to the Corporate Secretary of the Company at its principal corporate offices at 555 Theodore Fremd Avenue, Rye, New York 10580. Any notice required to be given or delivered to the Restricted Stockholder shall be in writing and addressed to the Restricted Stockholder at the address shown beneath such Restricted Stockholder's name on the signature page attached hereto or to such other address as such party may designate in writing from time to time to the Company. All notices shall be deemed to have been given or delivered upon: personal delivery; three (3) days after deposit in the United States mail by certified or registered mail (return receipt requested); one (1) business day after deposit with any return receipt express courier (prepaid); or one (1) business day after transmission by facsimile. (signature page follows) IN WITNESS WHEREOF, the Corporation has caused this Agreement to be executed by a duly authorized officer and the Restricted Stockholder has executed this Agreement as of the 8th day of May, 2003. JARDEN CORPORATION By: /s/ Martin E. Franklin ---------------------- Name: Martin E. Franklin Title: Chairman and Chief Executive Officer RESTRICTED STOCKHOLDER /s/ Ian G.H. Ashken ------------------- Name: Ian G.H. Ashken Address: 22 Bluewater Hill Westport, CT 06880 EX-10.4 27 file026.txt AMND. 1 TO RSTR. STCK AWRD AGR. IAN G. H. ASHKEN AMENDMENT NO. 1 TO RESTRICTED STOCK AWARD AGREEMENT THIS Amendment (the "Amendment"), dated as of September 4, 2003, to the Restricted Stock Award Agreement, dated May 8, 2003, is entered into between Jarden Corporation, a Delaware corporation (the "Company") and Ian G. H. Ashken, (the "Employee"). WITNESSETH: WHEREAS, the Employee and the Company are parties to that certain Restricted Stock Award Agreement dated May 8, 2003, (the "Agreement"); and WHEREAS, the parties mutually desire to amend the Agreement on the terms and conditions set forth more fully below. NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth in this Amendment, the Company and the Employee hereby agree as follows: 1. Section 2.a.(i) of the Agreement is hereby amended and restated to read as follows: "(i) the date that the per share stock price of the Common Stock equals or exceeds forty-two dollars ($42.00), subject to adjustment pursuant to Section 18.4 of the Plan or as otherwise mutually agreed in writing between the parties (for purposes of clarity, the term "stock price" above means the closing stock price of the Common Stock); or" 2. Except as expressly amended by this Amendment, the Agreement shall remain in full force and effect as the same was in effect immediately prior to the effectiveness of this Agreement. IN WITNESS WHEREOF, each of the parties hereto has duly executed this Agreement as of the date set forth above. JARDEN CORPORATION By: /s/ Martin E. Franklin ----------------------------- Name: Martin E. Franklin Title: Chairman and Chief Executive Officer /s/ Ian G.H. Ashken -------------------------------- Ian G.H. Ashken EX-10.5 28 file027.txt J.LILLIE RESTRICTED STOCK AWARD AGREEMENT JARDEN CORPORATION RESTRICTED STOCK AGREEMENT RESTRICTED STOCK AGREEMENT (the "Agreement") made as of this 4th day of August, 2003, by and between Jarden Corporation, a Delaware corporation, having its principal office at 555 Theodore Fremd Avenue, Rye, New York 10580 (the "Corporation"), and James E. Lillie residing at 49 Powder Horn Hill Road, Wilton, CT 06897 (the "Shareholder"). Capitalized terms not defined herein shall have the meanings ascribed to them in the Corporation's 2003 Stock Incentive Plan. W I T N E S S E T H: WHEREAS, the Corporation has heretofore adopted the Jarden Corporation 2003 Stock Incentive Plan (the "Plan") for the benefit of certain employees, officers, directors, consultants, independent contractors and advisors of the Corporation or any parent, affiliate or subsidiary of the Corporation (a "Participating Corporation"), which Plan has been approved by the Corporation's stockholders; and WHEREAS, the Restricted Stockholder is a valued and trusted employee of the Corporation and/or a Participating Corporation and the Corporation believes it to be in the best interests of the Corporation to reward the Restricted Stockholder for prior services and to secure the future services of the Restricted Stockholder by providing the Restricted Stockholder with an inducement to remain an employee of the Corporation and/or a Participating Corporation and through the grant of restricted shares of common stock (the "Common Stock"), par value $.01 per share, of the Corporation. NOW THEREFORE, in consideration of the mutual agreements herein contained, the parties hereto agree as follows: 1. GRANT OF RESTRICTED SHARES. Pursuant to the provisions of the Plan, effective as of August 8, 2003 (the "Date of Grant"), the Corporation hereby grants to the Restricted Stockholder Thirty-Five Thousand (35,000) shares of Common Stock (the "Restricted Shares"), subject to all of the terms and conditions of this Agreement and the Plan. As more fully described below, the shares granted hereby are subject to forfeiture by the Restricted Stockholder if certain criteria are not satisfied. 2. VESTING PERIOD. (a) Vesting. The Restricted Shares shall vest and become nonforfeitable upon the earlier of: (i) the date that the per share stock price of the Common Stock equals or exceeds forty dollars ($40.00), subject to adjustment pursuant to Section 18.4 of the Plan or as otherwise mutually agreed in writing between the parties; or (ii) the date that there is a Change-of-Control Event of the Company. (b) Notwithstanding the vesting schedule set forth in 2(a) above, schedule may be accelerated by the Board of Directors or the Committee, in their sole decision. (c) Restricted Shares that are vested pursuant to the provisions of this Section 2 hereof are "Vested Restricted Shares." Restricted Shares that are not vested pursuant to Section 2 hereof are "Unvested Restricted Shares." (d) Termination of Employment. If the Restricted Stockholder ceases to be an employee of the Corporation or any Participating Corporation for any reason whatsoever including, death, Disability, voluntary termination or termination by the Corporation or any Participating Corporation, prior to the satisfaction of the vesting provisions set forth in Section 2 hereof, notwithstanding anything to the contrary contained in this Agreement, no further portion of his or her Restricted Shares shall become vested pursuant to this Agreement and such Unvested Restricted Shares shall be forfeited effective as of the date that the Restricted Stockholder ceases to be so employed by the Corporation. For purposes of this Section 2, employment shall be considered as (i) continuing uninterrupted during any bona fide leave of absence approved in writing by the Committee (such as those attributable to prolonged illness), and (ii) continuing after any change of employment within or among the Corporation and any Participating Corporation so long as the Restricted Stockholder continues to be an employee of the Corporation or any Participating Corporation. In the event that the Restricted Stockholder continues to provide services to the Corporation or a Participating Corporation upon a termination of employment, the Committee may, in its sole discretion, determine that no termination shall occur until such time as such individual is no longer providing services to the Corporation or a Participating Corporation. 3. NON-TRANSFERABILITY. Until the Restricted Shares shall be vested and until the satisfaction of any and all other conditions specified herein, the Restricted Shares may not be sold, transferred, assigned, pledged or otherwise encumbered or disposed of by the Restricted Stockholder, except upon the written consent of the Corporation. 4. CERTIFICATES FOR SHARES, DIVIDENDS AND STOCKHOLDER RIGHTS. (a) Certificates for Restricted Shares shall be issued in the Restricted Stockholder's name and shall be held by the Corporation until the Restricted Shares shall become vested. The Corporation shall serve as attorney-in-fact for the Restricted Stockholder during the period during which the Restricted Shares are unvested with full power and authority in the Restricted Stockholder's name to assign and convey to the Corporation any Restricted Shares held by the Corporation for the Restricted Stockholder if the Restricted Stockholder forfeits the shares under the terms of this Agreement and the Plan. Certificates representing the Restricted Shares shall bear the following legend: "The Shares represented by this Stock Certificate have been granted as restricted stock under the Jarden Corporation 2003 Stock Incentive Plan. Without the prior written consent of the Corporation, the Shares represented by this Stock Certificate may not be sold, exchanged, assigned, transferred, pledged, hypothecated or otherwise encumbered or 2 disposed of unless the restrictions set forth in the Restricted Stock Agreement between the registered holder of these Shares and Jarden Corporation shall have lapsed." Upon the vesting of the Restricted Shares, the Corporation shall so notify the Secretary of the Corporation and the Secretary shall obtain from the Corporation Certificates representing all such shares that have vested, which Certificates shall not bear any restrictive endorsement making reference to this Agreement, and shall promptly issue and deliver such Certificates, if any, to the Restricted Stockholder. (b) Upon the full execution of this Agreement, subject to the provisions of Section 2 hereof, the Restricted Stockholder shall have all the rights of a stockholder with respect to such Restricted Shares, including the right to vote and receive all dividends or other distributions made or paid with respect to such Restricted Shares; provided, however, that such Restricted Shares and any new, additional or different securities the Restricted Stockholder may become entitled to receive with respect to such Restricted Shares by virtue of a stock split, dividend or other change in the corporate or capital structure of the Corporation shall be subject to the vesting and forfeiture provisions, restrictions on transfer and other restrictions set forth in this Agreement and the Plan. 5. SHARE ADJUSTMENTS. In the event of any stock dividend, stock split, combination or exchange of shares, merger, consolidation, spin-off or other distribution (other than normal cash dividends) of the Corporation's assets to stockholders, or any other change affecting shares of the Corporation's capitalization, the Committee in its discretion may make such adjustments as it may deem appropriate to reflect such change and to fairly preserve the intended benefits of the Plan. 6. NO RIGHT TO CONTINUED EMPLOYMENT. NOTHING IN THIS AGREEMENT SHALL CONFER UPON THE RESTRICTED STOCKHOLDER ANY RIGHT WITH RESPECT TO CONTINUANCE OF EMPLOYMENT BY THE CORPORATION OR ANY PARTICIPATING CORPORATION, NOR SHALL IT INTERFERE IN ANY WAY WITH THE RIGHT OF THE CORPORATION OR ANY PARTICIPATING CORPORATION TO TERMINATE THE RESTRICTED STOCKHOLDER'S EMPLOYMENT AT ANY TIME. THIS AGREEMENT DOES NOT CONSTITUTE AN EMPLOYMENT CONTRACT. THIS AGREEMENT DOES NOT GUARANTEE EMPLOYMENT FOR THE LENGTH OF TIME OF THE VESTING PERIOD OR FOR ANY PORTION THEREOF. 7. SECTION 83(b) ELECTION. If the Restricted Stockholder files an election with the Internal Revenue Service to include the Fair Market Value of any Restricted Shares in gross income as of the Date of Grant, the Restricted Stockholder agrees to promptly furnish the Corporation with a copy of such election, together with the amount of any federal, state, local or other taxes required to be withheld to enable the Corporation to claim an income tax deduction with respect to such election. 8. WITHHOLDING TAXES. The Restricted Stockholder acknowledges that the Corporation is not responsible for the tax consequences to the Restricted Stockholder of the granting or vesting of the Restricted Shares, and that it is the responsibility of the Restricted Stockholder to consult with the Restricted Stockholder's personal tax advisor regarding all matters with respect to the tax consequences of the granting and vesting of the Restricted Shares. 3 The Corporation shall have the right to deduct from the Restricted Shares or any payment to be made with respect to the Restricted Shares any amount that federal, state, local or foreign tax law required to be withheld with respect to the Restricted Shares or any such payment. Alternatively, the Corporation may require that the Restricted Stockholder, prior to or simultaneously with the Corporation incurring any obligation to withhold any such amount, pay such amount to the Corporation in cash or in shares of the Corporation's Common Stock (including shares of Common Stock retained from the Restricted Stock Award creating the tax obligation), which shall be valued at the Fair Market Value of such shares on the date of such payment. In any case where it is determined that taxes are required to be withheld in connection with the issuance, transfer or delivery of the shares, the Corporation may reduce the number of shares so issued, transferred or delivered by such number of shares as the Corporation may deem appropriate to comply with such withholding. The Corporation may also impose such conditions on the payment of any withholding obligations as may be required to satisfy applicable regulatory requirements under the Exchange Act. 9. COMPLIANCE WITH LAWS AND REGULATIONS. The issuance and transfer of Restricted Shares shall be subject to compliance by the Corporation and Restricted Stockholder with (i) all applicable requirements of federal and state securities laws, (ii) all applicable requirements of any stock exchange on which the Corporation's Common Stock may be listed and (iii) any applicable policy of the Corporation regarding the trading of securities of the Corporation, each at the time of such issuance and transfer. 10. RESTRICTED STOCKHOLDER BOUND BY PLAN. The Restricted Stockholder hereby acknowledges receipt of a copy of the Plan and agrees to be bound by all the terms and provisions thereof. In the event of any conflict between the provisions of this Agreement and the provisions of the Plan, the provisions of the Plan shall control. The Restricted Stockholder agrees to accept as binding, conclusive, and final all decisions or interpretations of the Committee upon any questions arising under the Plan. 11. INTERPRETATION. Any dispute regarding the interpretation of this Agreement shall be submitted by Restricted Stockholder or the Corporation to the Committee for review. The resolution of such a dispute by the Committee shall be final and binding on the Corporation and Restricted Stockholder. 12. ENTIRE AGREEMENT. The Plan is incorporated herein by reference. This Agreement and the Plan constitute the entire agreement and understanding of the parties hereto with respect to the subject matter hereof and supersede all prior understandings and agreements with respect to such subject matter. 13. NOTICES. Any notice required to be given or delivered to the Corporation under the terms of this Agreement shall be in writing and addressed to the Corporate Secretary of the Corporation at its principal corporate offices. Any notice required to be given or delivered to Restricted Stockholder shall be in writing and addressed to Restricted Stockholder at the address indicated above or to such other address as such party may designate in writing from time to time to the Corporation. All notices shall be deemed to have been given or delivered upon: (i) personal delivery; (ii) three (3) days after deposit in the United States mail by certified or registered mail (return receipt requested); (iii) one (1) business day after deposit with any 4 return receipt express courier (prepaid); or (iv) one (1) business day after transmission by facsimile. 14. SUCCESSORS AND ASSIGNS. The Corporation may assign any of its rights under this Agreement. This Agreement shall be binding upon and inure to the benefit of the successors and assigns of the Corporation. Subject to the restrictions on transfer set forth herein, this Agreement shall be binding upon Restricted Stockholder and Restricted Stockholder's heirs, executors, administrators, legal representatives, successors and assigns. 15. GOVERNING LAW. This Agreement shall be governed by and construed in accordance with the laws of the State of Delaware, applicable to agreements made and to be performed entirely within such state, other than conflict of laws principles thereof directing the application of any law other than that of Delaware. 16. ACCEPTANCE. Restricted Stockholder hereby acknowledges receipt of a copy of the Plan and this Agreement. Restricted Stockholder has read and understands the terms and provisions thereof, and accepts this Restricted Shares subject to all the terms and conditions of the Plan and this Agreement. These Restricted Share are subject to, and the Corporation and the Restricted Stockholder agree to be bound by, all of the terms and conditions of the Plan under which the Restricted Shares were granted, as the same shall have been amended, restated or otherwise modified from time to time in accordance with the terms hereof. In the event of any conflict between the provisions of this Agreement and the provisions of the Plan, the provisions of the Plan shall control. Pursuant to said Plan, the Board of Directors of the Corporation, or the Committee, is vested with final authority to interpret and construe the Plan and this Agreement, and its present form is available for inspection during the business hours by the Restricted Stockholder at the Corporation's principal office. Restricted Stockholder acknowledges that there maybe adverse tax consequences upon receipt of the Restricted Shares or disposition of the Restricted Shares and that the Corporation has advised Restricted Stockholder to consult a tax advisor prior to such receipt and disposition. 17. MISCELLANEOUS (a) This Agreement cannot be amended, supplemented or changed, and no provision hereof can be waived, except by a written instrument making specific reference to this Agreement and signed by the party against whom enforcement of any such amendment, supplement, modification or waiver is sought. A waiver of any right derived hereunder by either the Restricted Stockholder or Corporation shall not be deemed a waiver of any other right derived hereunder. (b) This Agreement may be executed in any number of counterparts, but all counterparts will together constitute but one agreement. (signature page follows) 5 IN WITNESS WHEREOF, the Corporation has caused this Agreement to be executed by its duly authorized officer and the Restricted Stockholder has executed this Agreement as of the Date of Grant. JARDEN CORPORATION By: /s/ J. David Tolbert ------------------------- Name: J. David Tolbert Title: Vice President, Human Resources and Administration RESTRICTED STOCKHOLDER /s/ James E. Lillie ----------------------------- Name: James E. Lillie Address: ----------------------------- ----------------------------- ----------------------------- Telecopier No.: ---------------------- 6 EX-10.6 29 file028.txt AMND. 1 TO RSTR. STCK AWRD AGR. JAMES E. LILLIE AMENDMENT NO. 1 TO RESTRICTED STOCK AWARD AGREEMENT THIS Amendment (the "Amendment"), dated as of September 4, 2003, to the Restricted Stock Award Agreement, dated August 4, 2003, is entered into between Jarden Corporation, a Delaware corporation (the "Company") and James E. Lillie, (the "Employee"). WITNESSETH: WHEREAS, the Employee and the Company are parties to that certain Restricted Stock Award Agreement dated August 4, 2003, (the "Agreement"); and WHEREAS, the parties mutually desire to amend the Agreement on the terms and conditions set forth more fully below. NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth in this Amendment, the Company and the Employee hereby agree as follows: 1. Section 2.a.(i) of the Agreement is hereby amended and restated to read as follows: "(i) the date that the per share stock price of the Common Stock equals or exceeds forty-two dollars ($42.00), subject to adjustment pursuant to Section 18.4 of the Plan or as otherwise mutually agreed in writing between the parties (for purposes of clarity, the term "stock price" above means the closing stock price of the Common Stock); or" 2. Except as expressly amended by this Amendment, the Agreement shall remain in full force and effect as the same was in effect immediately prior to the effectiveness of this Agreement. IN WITNESS WHEREOF, each of the parties hereto has duly executed this Agreement as of the date set forth above. JARDEN CORPORATION By: /s/ Ian G.H. Ashken ----------------------------- Name: Ian G.H. Ashken Title: Vice Chairman, Chief Financial Officer and Secretary /s/ James E. Lillie -------------------------------- James E. Lillie EX-10.7 30 file029.txt AMND. 4 TO RSTR. STCK AWRD AGR. MARTIN E. FRANKLIN AMENDMENT NO. 4 TO RESTRICTED STOCK AWARD AGREEMENT THIS Amendment (the "Amendment"), dated as of September 4, 2003, to the Restricted Stock Award Agreement, dated January 2, 2002, is entered into between Jarden Corporation, a Delaware corporation (the "Company") and Martin E. Franklin, (the "Employee"). WITNESSETH: WHEREAS, the Employee and the Company are parties to that certain Restricted Stock Award Agreement dated January 2, 2002, as amended, (the "Agreement"); and WHEREAS, the parties mutually desire to further amend the Agreement on the terms and conditions set forth more fully below. NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth in this Amendment, the Company and the Employee hereby agree as follows: 1. Section 1 of the Agreement is hereby amended and restated to read as follows: "1. Restrictions. Notwithstanding Section 5.02(b) of the Plan which is inapplicable to this grant, the restrictions shall lapse upon the earlier to occur of (i) the date that the per share stock price of the Common Stock equals or exceeds forty-two dollars ($42.00) or (ii) the date that there is a change of control (as defined in Section 2.01 of the Plan) of the Company. The number of shares granted and the target share price of $42.00 shall be adjusted for changes in the common stock as outlined in Section 5.05 of the Plan or as otherwise mutually agreed in writing between the parties. For purposes of clarity, the term "stock price" in (i) above means the closing stock price of the common stock of the Company." 2. Except as expressly amended by this Amendment, the Agreement shall remain in full force and effect as the same was in effect immediately prior to the effectiveness of this Agreement. IN WITNESS WHEREOF, each of the parties hereto has duly executed this Agreement as of the date set forth above. JARDEN CORPORATION By: /s/ Ian G.H. Ashken ----------------------------- Name: Ian G.H. Ashken Title: Vice Chairman and Chief Financial Officer /s/ Martin E. Franklin -------------------------------- Martin E. Franklin EX-10.8 31 file030.txt AMND. 4 TO RSTR. STCK AWRD AGR. IAN G. H. ASHKEN AMENDMENT NO. 4 TO RESTRICTED STOCK AWARD AGREEMENT THIS Amendment (the "Amendment"), dated as of September 4, 2003, to the Restricted Stock Award Agreement, dated January 2, 2002, is entered into between Jarden Corporation, a Delaware corporation (the "Company") and Ian G. H. Ashken, (the "Employee"). WITNESSETH: WHEREAS, the Employee and the Company are parties to that certain Restricted Stock Award Agreement dated January 2, 2002, as amended, (the "Agreement"); and WHEREAS, the parties mutually desire to further amend the Agreement on the terms and conditions set forth more fully below. NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth in this Amendment, the Company and the Employee hereby agree as follows: 1. Section 1 of the Agreement is hereby amended and restated to read as follows: "1. Restrictions. Notwithstanding Section 5.02(b) of the Plan which is inapplicable to this grant, the restrictions shall lapse upon the earlier to occur of (i) the date that the per share stock price of the Common Stock equals or exceeds forty-two dollars ($42.00) or (ii) the date that there is a change of control (as defined in Section 2.01 of the Plan) of the Company. The number of shares granted and the target share price of $42.00 shall be adjusted for changes in the common stock as outlined in Section 5.05 of the Plan or as otherwise mutually agreed in writing between the parties. For purposes of clarity, the term "stock price" in (i) above means the closing stock price of the common stock of the Company." 2. Except as expressly amended by this Amendment, the Agreement shall remain in full force and effect as the same was in effect immediately prior to the effectiveness of this Agreement. IN WITNESS WHEREOF, each of the parties hereto has duly executed this Agreement as of the date set forth above. JARDEN CORPORATION By: /s/ Martin E. Franklin -------------------------------- Name: Martin E. Franklin Title: Chairman and Chief Executive Officer /s/ Ian G.H. Ashken ----------------------------------- Ian G.H. Ashken EX-10.9 32 file031.txt AMND. 1 AMENDED AND RESTATED CREDIT AGREEMENT AMENDMENT NO. 1 TO AMENDED & RESTATED CREDIT AGREEMENT This Amendment No. 1 to Amended & Restated Credit Agreement (this "Agreement") dated as of September 25, 2003 is made by and among JARDEN CORPORATION, a Delaware corporation (the "Borrower"), BANK OF AMERICA, N.A., a national banking association organized and existing under the laws of the United States ("Bank of America"), in its capacity as administrative agent for the Lenders (as defined in the Credit Agreement (as defined below)) (in such capacity, the "Administrative Agent"), and each of the Lenders signatory hereto, and each of the Guarantors (as defined in the Credit Agreement) signatory hereto. W I T N E S S E T H: ------------------- WHEREAS, the Borrower, the Administrative Agent and the Lenders have entered into that certain Amended & Restated Credit Agreement dated as of September 2, 2003 (as hereby amended and as from time to time hereafter further amended, modified, supplemented, restated, or amended and restated, the "Credit Agreement"; the capitalized terms used in this Agreement not otherwise defined herein shall have the respective meanings given thereto in the Credit Agreement), pursuant to which the Lenders have made available to the Borrower various revolving credit and term loan facilities, including a letter of credit facility and a swing line facility; and WHEREAS, each of the Guarantors has entered into a Guaranty pursuant to which it has guaranteed certain or all of the obligations of the Borrower under the Credit Agreement and the other Loan Documents; and WHEREAS, the Borrower has requested that the Administrative Agent and the Lenders agree to amend certain terms of the Credit Agreement, which the Administrative Agent and the Lenders party hereto are willing to do on the terms and conditions contained in this Agreement; NOW, THEREFORE, in consideration of the premises and further valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto agree as follows: 1. Amendments to Credit Agreement. Subject to the terms and conditions set forth herein, the Credit Agreement is hereby amended as follows: (a) Each of the following definitions is hereby deleted from Article I of the Credit Agreement: (i) Non-Scheduled Acquisition B Equity Issuance, and (ii) Scheduled Acquisition B Equity Issuance. (b) The following new definition is hereby added to Article I of the Credit Agreement in its proper alphabetical order: "Permitted Equity Issuance" means one issuance of Equity Securities of the Borrower to occur not later than January 31, 2004 with gross proceeds not to exceed $120,000,000. (c) The definition of "Non-Exempt Net Proceeds" in Article I of the Credit Agreement is hereby deleted in its entirety and replaced with the following: "Non-Exempt Net Proceeds" means (a) during the period of 180 days after the date of the Permitted Equity Issuance, $0, and (b) thereafter, the difference (but not less than $0) of (i) the aggregate Net Proceeds of the Permitted Equity Issuance, minus (ii) the aggregate amount of the Net Proceeds of the Permitted Equity Issuance utilized within 180 days of such issuance to pay Costs of Acquisition of consummated Permitted Acquisitions (but including the Cost of Acquisition of Scheduled Acquisition A, even if it is consummated prior to the occurrence of the Permitted Equity Issuance) and the Scheduled Acquisition B, minus (iii) $50,000,000. (d) Section 2.06(e)(ii) is hereby deleted in its entirety and replaced with the following: (ii) The Borrower shall make, or shall cause each applicable Subsidiary to make, a prepayment with respect to each private or public offering of Equity Securities of the Borrower or any Subsidiary (other than Equity Securities issued to the Borrower or a Guarantor) in an amount equal to (x) in the case of the issuance of any Equity Securities other than the Permitted Equity Issuance, fifty percent (50%) of the Net Proceeds of each such issuance of Equity Securities of the Borrower or any Subsidiary, and (y) in the case of the Permitted Equity Issuance, (A) one hundred percent (100%) of the first $50,000,000 of the Non-Exempt Net Proceeds thereof and (B) fifty percent (50%) of any remaining Non-Exempt Net Proceeds thereof. Each prepayment provided for in this Section 2.06(e)(ii) will be made within ten (10) Business Days of receipt of such proceeds (or, in the case of Non-Exempt Net Proceeds, within ten (10) Business Days of the expiration of the 180-day period following the Permitted Equity Issuance) and upon not less than five (5) Business Days' prior written notice to the Administrative Agent, which notice shall include a certificate of a Responsible Officer of the Borrower setting forth in reasonable detail the calculations utilized in computing the Net Proceeds of such issuance and the amount of such prepayment; provided that no prepayment shall be required hereunder of the first $20,000,000 of Net Proceeds in each fiscal year of the Borrower realized from (x) the issuance of Equity Securities in connection with the exercise of any option, warrant or other convertible security of the Borrower or any Subsidiary or (y) the issuance, award or grant of Equity Securities to eligible participants under a stock plan of the Borrower. (e) Section 5.11 is hereby amended to replace the reference to "Scheduled B Equity Issuance" therein with "Permitted Equity Issuance." (f) Schedule 1.02(d) is hereby amended by deleting the line in the labeled "Scheduled Acquisition B Equity Issuance" and replacing it with the following: 2
- -------------------------------------------------------------------------------- Permitted Equity Issuance: That portion of the gross proceeds used to consummate the Scheduled Acquisition B (a) is to be not less than an amount sufficient so that (after giving effect to the Permitted Equity Issuance, the consummation of the Scheduled Acquisition B, the consummation of all Permitted Acquisitions from the Closing Date to the date of the Scheduled Acquisition B, and all borrowings and incurrences of debt in connection with all such transactions) the Total Leverage Ratio (pro forma for all such transactions) does not exceed 3.20 to 1.00, and (b) results from the issuance of common stock of the Borrower. - --------------------------------------------------------------------------------
2. Effectiveness; Conditions Precedent. The effectiveness of this Agreement and the amendments to the Credit Agreement provided in Paragraph 1 hereof are all subject to the satisfaction of each the following conditions precedent: (a) The Administrative Agent shall have received each of the following documents or instruments in form and substance reasonably acceptable to the Administrative Agent: (i) four (4) original counterparts of this Agreement, duly executed by the Borrower, the Administrative Agent, each Guarantor and the Required Lenders, together with all schedules and exhibits thereto duly completed; (ii) such other documents, instruments, opinions, certifications, undertakings, further assurances and other matters as the Administrative Agent shall reasonably request. (b) All fees and expenses payable to the Administrative Agent and the Lenders (including the fees and expenses of counsel to the Administrative Agent) estimated to date shall have been paid in full (without prejudice to final settling of accounts for such fees and expenses). 3. Consent of the Guarantors. Each Guarantor hereby consents, acknowledges and agrees to the amendments and other matters set forth herein and hereby confirms and ratifies in all respects the Guaranty to which such Guarantor is a party (including without limitation the continuation of such Guarantor's payment and performance obligations thereunder upon and after the effectiveness of this Agreement and the amendments, waivers and consents contemplated hereby) and the enforceability of such Guaranty against such Guarantor in accordance with its terms. 4. Representations and Warranties. In order to induce the Administrative Agent and the Lenders to enter into this Agreement, the Borrower represents and warrants to the Administrative Agent and the Lenders as follows: (a) The representations and warranties made by the Borrower in Article V of the Credit Agreement and in each of the other Loan Documents to which it is a party are true and correct in all material respects on and as of the date hereof, except to the extent that such representations and warranties expressly relate to an earlier date; 3 (b) Since June 30, 2003, no act, event, condition or circumstance has occurred or arisen which, singly or in the aggregate with one or more other acts, events, occurrences or conditions (whenever occurring or arising), has had or could reasonably be expected to have a Material Adverse Effect; (c) The Persons appearing as Guarantors on the signature pages to this Agreement constitute all Persons who are required to be Guarantors pursuant to the terms of the Credit Agreement and the other Loan Documents, including without limitation all Persons who became Subsidiaries or were otherwise required to become Guarantors after the Closing Date, and each of such Persons has become and remains a party to a Guaranty as a Guarantor; (d) This Agreement has been duly authorized, executed and delivered by the Borrower and Guarantors party hereto and constitutes a legal, valid and binding obligation of such parties, except as may be limited by general principles of equity or by the effect of any applicable bankruptcy, insolvency, reorganization, moratorium or similar law affecting creditors' rights generally; and (e) After giving effect to this Agreement, no Default or Event of Default has occurred and is continuing. 5. Entire Agreement. This Agreement, together with all the Loan Documents (collectively, the "Relevant Documents"), sets forth the entire understanding and agreement of the parties hereto in relation to the subject matter hereof and supersedes any prior negotiations and agreements among the parties relating to such subject matter. No promise, condition, representation or warranty, express or implied, not set forth in the Relevant Documents shall bind any party hereto, and no such party has relied on any such promise, condition, representation or warranty. Each of the parties hereto acknowledges that, except as otherwise expressly stated in the Relevant Documents, no representations, warranties or commitments, express or implied, have been made by any party to the other. None of the terms or conditions of this Agreement may be changed, modified, waived or canceled orally or otherwise, except in writing and in accordance with Section 10.01 of the Credit Agreement. 6. Full Force and Effect of Agreement. Except as hereby specifically amended, modified or supplemented, the Credit Agreement and all other Loan Documents are hereby confirmed and ratified in all respects and shall be and remain in full force and effect according to their respective terms. 7. Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be deemed an original as against any party whose signature appears thereon, and all of which shall together constitute one and the same instrument. 8. Governing Law. This Agreement shall in all respects be governed by, and construed in accordance with, the laws of the State of New York applicable to contracts executed and to be performed entirely within such State, and shall be further subject to the provisions of Sections 10.17(b) and 10.18 of the Credit Agreement. 4 9. Enforceability. Should any one or more of the provisions of this Agreement be determined to be illegal or unenforceable as to one or more of the parties hereto, all other provisions nevertheless shall remain effective and binding on the parties hereto. 10. References. All references in any of the Loan Documents to the "Credit Agreement" shall mean the Credit Agreement, as amended hereby. 11. Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the Borrower, the Administrative Agent and each of the Guarantors and Lenders, and their respective successors, legal representatives, and assignees to the extent such assignees are permitted assignees as provided in Section 10.07 of the Credit Agreement. [SIGNATURE PAGES FOLLOW.] 5 IN WITNESS WHEREOF, the parties hereto have caused this instrument to be made, executed and delivered by their duly authorized officers as of the day and year first above written. BORROWER: JARDEN CORPORATION By: /s/ Desiree DeStefano --------------------- Name: Desiree DeStefano Title: Senior Vice President GUARANTORS: HEARTHMARK, INC., an Indiana corporation ALLTRISTA PLASTICS CORPORATION, an Indiana corporation ALLTRISTA NEWCO CORPORATION, an Indiana corporation LEHIGH CONSUMER PRODUCTS CORPORATION, a Pennsylvania corporation TILIA, INC. (successor by name change to Alltrista Acquisition I, Inc.), a Delaware corporation TILIA DIRECT, INC. (successor by name change to Alltrista Acquisition II, Inc.), a Delaware corporation TILIA INTERNATIONAL, INC. (successor by name change to Alltrista Acquisition III, Inc.), a Delaware corporation QUOIN CORPORATION, a Delaware corporation By: /s/ Desiree DeStefano --------------------- Name: Desiree DeStefano Title: Vice President ALLTRISTA ZINC PRODUCTS, L.P., an Indiana limited partnership By: Alltrista Newco Corporation, a Indiana corporation, its general partner By: /s/ Desiree DeStefano --------------------- Name: Desiree DeStefano Title: Vice President ADMINISTRATIVE AGENT: -------------------- BANK OF AMERICA, N.A., AS ADMINISTRATIVE AGENT By: /s/ Tim Cassidy ----------------------- Name: Tim Cassidy Title: Vice President LENDERS: ------- BANK OF AMERICA, N.A., as a Lender, L/C Issuer and Swing Line Lender By: /s/ Tim Cassidy ----------------------- Name: Tim Cassidy Title: Vice President CIBC INC. By: /s/ Dean J. Decker ------------------ Name: Dean J. Decker Title: Managing Director CIBC World Markets Corp. As agent for CIBC INC. NATIONAL CITY BANK OF INDIANA By: /s/ David G. McNeely --------------------------- Name: David G. McNeely Title: Assistant Vice President THE BANK OF NEW YORK By: /s/ Maurice A. Campbell --------------------------- Name: Maurice A. Campbell Title: Vice President FLEET NATIONAL BANK By: /s/ W. Lincoln Schoff, Jr. --------------------------- Name: W. Lincoln Schoff, Jr. Title: Senior VP HARRIS TRUST AND SAVINGS BANK By: /s/ Thad D. Rasche --------------------------- Name: Thad D. Rasche Title: Vice President SUNTRUST BANK By: /s/ Heidi M. Khambatta --------------------------- Name: Heidi M. Khambatta Title: Vice President TRANSAMERICA BUSINESS CAPITAL CORPORATION By: /s/ Stephen Goetschius --------------------------- Name: Stephen Goetschius Title: Senior Vice President APEX (IDM) CDO I LTD. By: David L. Babson & Company Inc., as Collateral Manager By: /s/ David P. Wells --------------------------- Name: David P. Wells, CFA Title: Managing Director BABSON CLO LTD. 2003-1 By: David L. Babson & Company Inc. as Manager By: /s/ David P. Wells --------------------------- Name: David P. Wells, CFA Title: Managing Director BILL & MELINDA GATES FOUNDATION By: David L. Babson & Company Inc. as Investment Adviser By: /s/ David P. Wells --------------------------- Name: David P. Wells, CFA Title: Managing Director CHIRON CDO I LTD. By: /s/ John Randolph Watkins --------------------------- Name: John Randolph Watkins Title: Executive Director DENALI CAPITAL CLO III LTD. Denali Capital LLC, managing member of DC Funding Partners, portfolio manager for DENALI CAPITAL CLO III, LTD., or an affiliate By: /s/ John P. Thacker --------------------------- Name: John P. Thacker Title: Chief Credit Officer EAST WEST BANK By: /s/ Nancy A. Moore --------------------------- Name: Nancy A. Moore Title: Senior Vice President ELC (CAYMAN) LTD, 2000-1 By: David L. Babson & Company Inc. as Collateral Manager By: /s/ David P. Wells --------------------------- Name: David P. Wells, CFA Title: Managing Director ELC CAYMAN LTD. 1999-II By: David L. Babson & Company Inc. as Collateral Manager By: /s/ David P. Wells --------------------------- Name: David P. Wells, CFA Title: Managing Director ELC CAYMAN LTD. 1999-III By: David L. Babson & Company Inc. as Collateral Manager By: /s/ David P. Wells --------------------------- Name: David P. Wells, CFA Title: Managing Director FLAGSHIP CLO 2001-1 By: Flagship Capital Management, Inc. By: /s/ Colleen Cunniffe --------------------------- Name: Colleen Cunniffe Title: Director FLAGSHIP CLO II By: Flagship Capital Management, Inc. By: /s/ Colleen Cunniffe --------------------------- Name: Colleen Cunniffe Title: Director FRANKLIN CLO IV, LIMITED By: /s/ Tyler Chan --------------------------- Name: Tyler Chan Title: Vice President FRANKLIN FLOATING RATE DAILY ACCESS By: /s/ Tyler Chan --------------------------- Name: Tyler Chan Title: Vice President FRANKLIN FLOATING RATE MASTER By: /s/ Tyler Chan --------------------------- Name: Tyler Chan Title: Vice President GENERAL ELECTRIC CAPITAL CORP. By: /s/ Brian P. Schwinn --------------------------- Name: Brian P. Schwinn Title: Duly Authorized Signatory ING PRIME RATE TRUST By: Aeltus Investment Management, Inc. as its investment manager By: /s/ Brian S. Horton --------------------------- Name: Brian S. Horton Title: Vice President ING SENIOR INCOME FUND By: Aeltus Investment Management, Inc. as its investment manager By: /s/ Brian S. Horton --------------------------- Name: Brian S. Horton Title: Vice President LIBERTY FLOATING RATE ADVANTAGE FUND By: Columbia Management Advisors, Inc. (f/k/a Stein Roe & Farnham Incorporated), As Advisor By: /s/ --------------------------- Name: Title: MAPLEWOOD (CAYMAN) LIMITED By: David L. Babson & Company Inc. under delegated authority from Massachusetts Mutual Life Insurance Company as Investment Manager By: /s/ David P. Wells --------------------------- Name: David P. Wells, CFA Title: Managing Director MASSACHUSETTS MUTUAL LIFE INSURANCE CO. By: David L. Babson & Company Inc. as Investment Adviser By: /s/ David P. Wells --------------------------- Name: David P. Wells, CFA Title: Managing Director PILGRIM AMERICA HIGH INCOME INVESTMENTS LTD. By: ING Investments, LLC as its investment manager By: /s/ Brian S. Horton --------------------------- Name: Brian S. Horton Title: Vice President PINEHURST TRADING INC. By: /s/ Diana M. Himes --------------------------- Name: Diana M. Himes Title: Assistant Vice President PPM-SHADOW CREEK FUNDING LLC By: /s/ Diana M. Himes --------------------------- Name: Diana M. Himes Title: Assistant Vice President PPM-SPYGLASS FUNDING TRUST By: /s/ Diana M. Himes --------------------------- Name: Diana M. Himes Title: Authorized Agent SIMSBURY CLO LIMITED By: David L. Babson & Company Inc. under delegated authority from Massachusetts Mutual Life Insurance Company as Collateral Manager By: /s/ David P. Wells --------------------------- Name: David P. Wells, CFA Title: Managing Director SRF 2000 INC. By: /s/ Diana M. Himes --------------------------- Name: Diana M. Himes Title: Assistant Vice President SRF TRADING INC. By: /s/ Diana M. Himes --------------------------- Name: Diana M. Himes Title: Assistant Vice President STANWICH LOAN FUNDING LLC By: /s/ Diana M. Himes --------------------------- Name: Diana M. Himes Title: Assistant Vice President STEIN ROE FLOATING RATE LIMITED LIABILITY COMPANY By: Columbia Management Advisors, Inc. (f/k/a Stein Roe & Farnham Incorporated), As Advisor By: /s/ --------------------------- Name: Title: SUFFIELD CLO LIMITED By: David L. Babson & Company Inc. as Collateral Manager By: /s/ David P. Wells --------------------------- Name: David P. Wells, CFA Title: Managing Director TORONTO DOMINION (NEW YORK), INC. By: /s/ Stacey Malek --------------------------- Name: Stacey Malek Title: Vice President TRUMBULL THC LTD. By: /s/ Stacey Malek --------------------------- Name: Stacey Malek Title: Attorney In Fact EX-99.1 33 file032.txt FINAL PROSPECTUS SUPPLEMENT PROSPECTUS SUPPLEMENT TO PROSPECTUS DATED JANUARY 31, 2003 2,800,000 SHARES [JARDEN CORPORATION LOGO OMITTED] COMMON STOCK $37.00 PER SHARE - -------------------------------------------------------------------------------- Jarden Corporation is offering 2,800,000 shares of common stock. Our shares of common stock are listed on the New York Stock Exchange under the symbol "JAH." On September 25, 2003, the last reported sale price of our common stock on the New York Stock Exchange was $37.25 per share. INVESTING IN OUR COMMON STOCK INVOLVES RISKS. SEE "RISK FACTORS" BEGINNING ON PAGE S-11 OF THIS PROSPECTUS SUPPLEMENT AND PAGE 9 OF THE ACCOMPANYING PROSPECTUS AND THE REPORTS INCORPORATED BY REFERENCE IN THIS PROSPECTUS SUPPLEMENT AND THE ACCOMPANYING PROSPECTUS FOR A DISCUSSION OF RISKS ASSOCIATED WITH OWNING OUR COMMON STOCK. PER SHARE TOTAL --------- ----- Price to the public ..................... $37.00 $103,600,000 Underwriting discount ................... $ 1.85 $ 5,180,000 Proceeds to Jarden Corporation .......... $35.15 $ 98,420,000 We have granted an over-allotment option to the underwriters. Under this option, the underwriters may elect to purchase a maximum of 420,000 additional shares from us within 30 days following the date of this prospectus supplement to cover over-allotments. - -------------------------------------------------------------------------------- NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR DETERMINED IF THIS PROSPECTUS SUPPLEMENT OR THE ACCOMPANYING PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. Joint Book Running Managers CIBC WORLD MARKETS BANC OF AMERICA SECURITIES LLC -------------------- SUNTRUST ROBINSON HUMPHREY WILLIAM BLAIR & COMPANY The date of this Prospectus Supplement is September 25, 2003 [PHOTO OMITTED] We are a leading provider of niche, branded consumer products used in and around the home. JARDEN CORPORATION TABLE OF CONTENTS PROSPECTUS SUPPLEMENT
PAGE ----- Prospectus Supplement Summary ............................................................ S-1 Risk Factors ............................................................................. S-11 Reductions, cancellations, or delays in customer purchases could adversely affect our profitability ......................................................................... S-11 We may experience difficulty in integrating acquired businesses, which may interrupt our business operations ................................................................... S-11 Our business could be adversely affected because of risks associated with international operations .............................................................. S-11 Claims made against us based on product liability could have a material adverse effect on our business .......................................................................... S-11 Our failure to successfully protect our intellectual property rights could have a material adverse effect on our business................................................ S-12 Our significant indebtedness could adversely affect our financial health and prevent us from fulfilling our debt obligations .................................................. S-12 Forward-Looking Statements ............................................................... S-14 Use of Proceeds .......................................................................... S-15 Price Range of Common Stock and Dividend Policy .......................................... S-15 Capitalization ........................................................................... S-16 Selected Financial Data .................................................................. S-17 Management's Discussion and Analysis of Financial Condition and Results of Operations .... S-19 Unaudited Pro Forma Condensed Consolidated Financial Statements .......................... S-27 Business ................................................................................. S-33 Management ............................................................................... S-44 Security Ownership of Certain Beneficial Owners and Management ........................... S-47 Underwriting ............................................................................. S-49 Experts .................................................................................. S-51 Legal Matters ............................................................................ S-51 PROSPECTUS Summary .................................................................................. 1 Incorporation of Certain Documents By Reference .......................................... 2 The Company .............................................................................. 3 Risk Factors ............................................................................. 9 Reductions, cancellations, or delays in customer purchases would adversely affect our profitability ......................................................................... 9 We may be adversely affected by the trend towards retail trade consolidation ............ 9 Sales of some of our products are seasonal and weather related .......................... 9 We depend on suppliers in Asia .......................................................... 9 Competition in our industries may hinder our ability to execute our business strategy, achieve profitability, or maintain relationships with existing customers .............. 10 If we fail to develop new or expand existing customer relationships, our ability to grow our business will be impaired ......................................................... 11 We cannot be certain that our product innovations and marketing successes will continue . 11 We may experience difficulty in integrating acquired businesses, which may interrupt our business operations ................................................................... 11 Our operations are subject to a number of Federal, state and local environmental regulations ............................................................................ 11 We may be adversely affected by remediation obligations mandated by applicable environmental laws .................................................................... 11 We depend upon key personnel ............................................................ 12 We enter into contracts with the United States government and other governments ......... 12
S-ii
Our operating results can be adversely affected by changes in the cost or availability of raw materials ......................................................................... 12 Our business could be adversely affected because of risks which are particular to international operations .............................................................. 12 Our performance can fluctuate with the financial condition of the retail industry ....... 13 Claims made against us based on product liability could have a material adverse effect on our business .......................................................................... 13 We depend on our patents and proprietary rights ......................................... 13 We depend on a single manufacturing facility for certain essential products ............. 13 Certain of our employees are represented by labor unions ................................ 14 Our significant indebtedness could adversely affect our financial health and prevent us from fulfilling our obligations under our debt ........................................ 14 We will require a significant amount of cash to service our indebtedness. Our ability to generate cash depends on many factors beyond our control .............................. 14 The indenture related to the debt securities, our 9 3/4% senior subordinated notes due 2012, and our senior credit facility contain various covenants which limit our management's discretion in the operation of our business .............................. 15 We may not have the ability to raise the funds necessary to finance the change of control offer required by the indenture related to our 9 3/4% senior subordinated notes due 2012 .... ......................................................................... 15 Delaware law and our rights plan may limit possible takeovers ........................... 15 The market price for our common stock is volatile ....................................... 16 We may issue a substantial amount of our common stock in connection with future acquisitions and the sale of those shares could adversely affect our stock price ...... 16 Our stock price may be adversely affected if our stockholders sell substantial amounts of our common stock, or our preferred stock or warrants convertible into our common stock, in the public market following the offering .................................... 16 Since we have broad discretion in how we use the net proceeds from this offering, we may use such proceeds in ways with which you disagree ..................................... 17 Your right to receive payments on the debt securities is junior to our existing senior indebtedness and possibly all of our future borrowings. Further, the guarantees of the debt securities are junior to all of the guarantors' existing senior indebtedness and possibly to all their future borrowings ............................................... 17 Since the debt securities are unsecured, your right to enforce remedies is limited by the rights of holders of secured debt ................................................. 17 Not all of our subsidiaries will guarantee our obligations under the debt securities, and the assets of the non-guarantor subsidiaries may not be available to make payments on the debt securities ................................................................ 17 A public market for the debt securities may not develop ................................. 18 Federal and state statutes allow courts, under specific circumstances, to void guarantees and require security holders to return payments received from guarantors ... 18 Forward Looking Statements ............................................................... 20 Use of Proceeds .......................................................................... 21 Ratio of Earnings to Fixed Charges ....................................................... 21 Description of the Debt Securities ....................................................... 22 Description of Capital Stock ............................................................. 27 Description of Warrants .................................................................. 27 Description of Senior Indebtedness ....................................................... 28 Plan of Distribution ..................................................................... 32 Where You Can Find More Information ...................................................... 33 Experts .................................................................................. 33 Legal Matters ............................................................................ 34
S-iii INDUSTRY DATA In this prospectus supplement and the accompanying prospectus, we rely on and refer to information regarding market data obtained from internal surveys, market research, publicly available information and industry publications. Although we believe the information is reliable, we cannot guarantee the accuracy or completeness of the information and have not independently verified it. ABOUT THIS PROSPECTUS SUPPLEMENT We provide information to you about this offering in two separate documents. The accompanying prospectus provides general information, some of which may not apply to this offering, and this prospectus supplement describes the specific details regarding this offering. Generally, when we refer to this "prospectus," we are referring to both documents combined. Additional information is incorporated by reference in this prospectus. If information in this prospectus supplement is inconsistent with the accompanying prospectus, you should rely on this prospectus supplement. You should rely only upon the information contained or incorporated by reference in this prospectus. We have not, and the underwriters have not, authorized any other person to provide you with different information. If anyone provides you with different or inconsistent information, you should not rely on it. This prospectus does not constitute an offer to sell, or a solicitation of an offer to buy, any of the securities offered hereby by any person in any jurisdiction in which it is unlawful for such person to make such an offer or solicitation. You should assume the information appearing in this prospectus supplement, the accompanying prospectus and the documents incorporated by reference is accurate only as of their respective dates. Our business, financial condition, results of operations and prospects may have changed since those dates. Our owned and licensed trademarks, service marks and trade names include Ball (Registered Trademark) , Bernardin (Registered Trademark) , Crawford (Registered Trademark) , Diamond (Registered Trademark) , FoodSaver (Registered Trademark) , Forster (Registered Trademark) , Golden Harvest (Registered Trademark) , Lady Dianne (Registered Trademark) , Kerr (Registered Trademark) , Lehigh (Registered Trademark) , Leslie-Locke (Registered Trademark) , Shake-A-Pick (Registered Trademark) , and Storehorse (Registered Trademark) . This prospectus also contains trademarks, service marks, copyrights and trade names of other companies. S-iv PROSPECTUS SUPPLEMENT SUMMARY The following summary is qualified in its entirety by, and should be read together with, the more detailed information and audited consolidated financial statements and the notes thereto contained or incorporated by reference in this prospectus supplement or the accompanying prospectus. Because this is only a summary, it may not contain all of the information important to you or that you should consider before making an investment decision. Therefore, we urge you to read this prospectus supplement, the accompanying prospectus and the documents to which we have referred you. Unless the context otherwise requires, "Jarden," "we," "us," "our" and similar terms refer to Jarden Corporation and its subsidiaries, "Tilia" refers to the business of Tilia International, Inc. and its subsidiaries, "Diamond" refers to the business of Diamond Brands International, Inc. and its subsidiaries, and "Lehigh" refers to the business of Lehigh Consumer Products Corporation and its subsidiary. OUR COMPANY We are a leading provider of niche consumer products used in and around the home, under well-known brand names including Ball (Registered Trademark) , Bernardin (Registered Trademark) , Crawford (Registered Trademark) , Diamond (Registered Trademark) , FoodSaver (Registered Trademark) , Forster (Registered Trademark) , Kerr (Registered Trademark) , Lehigh (Registered Trademark) and Leslie-Locke (Registered Trademark) . In North America, we are the market leader in several targeted categories, including branded retail plastic cutlery, home canning, home vacuum packaging, kitchen matches, rope, cord and twine and toothpicks. Many of our products are affordable, consumable and fundamental household staples, resulting in recurring revenues. Our highly recognized brands, innovative products and multi-channel distribution strategy, together with our strategic acquisitions, have resulted in significant growth in revenue and profitability. In the year ended December 31, 2002, we generated $635.4 million, $104.8 million and $52.1 million in net sales, operating income and net income, respectively on a pro forma basis, after taking into effect our acquisitions of Tilia, Diamond and Lehigh as though they were effective as of January 1, 2002. We have achieved leading market positions by selling branded consumer products through a variety of distribution channels, including club, department store, drug, grocery, hardware, home improvement, mass merchant and specialty retailers, as well as direct to consumers. By leveraging our strong brand portfolio, category management expertise and superior customer service, we have established and continue to maintain long-term relationships with leading retailers within these channels. We have long-standing relationships with each of our top ten customers. For example, we have serviced Wal-Mart and Home Depot since their openings in 1962 and 1978, respectively, and are currently category manager at Wal-Mart for home canning-related products and at Home Depot for cordage. Moreover, several of our leading brands, such as Diamond (Registered Trademark) kitchen matches and Ball (Registered Trademark) jars, have been in continuous use for over 100 years. We continue to expand our existing customer relationships and attract customers by introducing new product line extensions and entering new product categories. We operate three primary business segments, comprised of branded consumables, consumer solutions and plastic consumables. Branded Consumables. We manufacture or source, market and distribute a broad line of branded consumer products that includes craft items, food preparation kits, home canning jars, jar closures, kitchen matches, plastic cutlery, rope, cord and twine, storage and workshop accessories, toothpicks and other accessories marketed under the Ball (Registered Trademark) , Bernardin (Registered Trademark) , Crawford (Registered Trademark) , Diamond (Registered Trademark) , Forster (Registered Trademark) , Kerr (Registered Trademark) , Lehigh (Registered Trademark) and Leslie-Locke (Registered Trademark) brand names. We deliver our branded consumable products to over 3,100 customers nationwide. On September 2, 2003, we acquired all of the issued and outstanding stock of Lehigh Consumer Products Corporation ("Lehigh"), the largest supplier of rope, cord and twine for the U.S. consumer marketplace and a leader in innovative storage and organization products for the home and garage as well as products in the security door and fencing market. Consumer Solutions. We source, market and distribute an array of home vacuum packaging machines under the market leading FoodSaver (Registered Trademark) brand name, as well as other products that service the needs of the consumer in the kitchen. We believe that the FoodSaver (Registered Trademark) vacuum packaging system is superior to S-1 more conventional means of food packaging, including freezer and storage bags and plastic containers, in preventing dehydration, rancidity, mold, freezer burn and hardening of food. The original FoodSaver (Registered Trademark) product was successfully launched through infomercials and has since expanded its distribution channels to be based primarily on retail customers. In addition to machines, we market and distribute an expanding line of proprietary bags and bag rolls for use with FoodSaver (Registered Trademark) machines, which represents a recurring revenue source, along with accessories including canisters, jar sealers and wine stoppers. Plastic Consumables. We manufacture, market and distribute a wide variety of consumer and medical plastic products for customers and our other primary segments. These products include closures, contact lens packaging, plastic cutlery, refrigerator door liners, shotgun shell casings, surgical devices and syringes. Many of these products are consumable in nature or represent components of consumer products. In addition to the three primary business segments described above, our other business consists primarily of our zinc strip business, which is the largest producer of zinc strip and fabricated products in the United States. COMPETITIVE STRENGTHS We believe that the following competitive strengths serve as a foundation for our growth strategy: Market Leadership Positions. In North America, we are a leader in several targeted categories including, among others, branded retail plastic cutlery, home canning, home vacuum packaging, kitchen matches, rope, cord and twine and toothpicks. We believe that the specialized nature of our niche categories and our leading market shares therein provide us with competitive advantages in terms of demand from major retailers and enhanced brand awareness. We created the home vacuum packaging category at most of our retailers and actively work with them to promote the FoodSaver (Registered Trademark) brand and home vacuum packaging to consumers. In addition, our branded consumables business is either the named category manager, sole supplier or one of a select few vendors to the dominant retailers in many of its product lines. Strong Brand Name Recognition. We have built a portfolio of leading consumer brands, which assists us in gaining retail shelf space and introducing new products. The Ball (Registered Trademark) brand has been in continuous use for over 100 years and is internationally recognized within the home food preservation market. In the United States, we believe Kerr (Registered Trademark) is also a widely-recognized home canning brand while Bernardin (Registered Trademark) is the leading home canning brand in Canada. We believe Diamond (Registered Trademark) , Forster (Registered Trademark) and FoodSaver (Registered Trademark) are the leading brands in their principal markets and are well recognized by consumers. We believe our strong brand recognition and consumer awareness, coupled with the long-standing quality of our products, results in significant customer loyalty. Comprehensive Product Offering. We provide retailers a comprehensive portfolio of niche consumer products across multiple categories, which adds diversity to our revenues and cash flows. Within these categories, we service the needs of a wide range of consumers and satisfy their different tastes, preferences and budgets. In home canning, we offer a range of branded products to serve the value, mid-tier and premium price points, selling more than 300 stock keeping units. We offer kitchen matches, plastic cutlery and toothpicks of various counts, sizes and durability. FoodSaver's (Registered Trademark) current offerings are well positioned to take advantage of a "good, better, best" strategy in order to target consumers with various levels of price sensitivity and product sophistication. We also offer rope, cord and twine products, storage and workshop accessories and metal security doors and fencing covering more than 1,500 stock keeping units. We believe our ability to serve retailers with a broad array of branded products and introduce new products will continue to allow us to penetrate existing customers. Long-Term Customer Relationships. We have established and continue to maintain strong relationships with our retail customers based, in part, on our portfolio of leading brands, superior S-2 customer service and product innovation. We are the named category manager for various products at key retailers, including Wal-Mart, Home Depot and Lowe's, and are the leading supplier for other products for which there is no named category manager. In addition, we have maintained relationships for more than 10 years with virtually all of our key customers. We provide marketing, technical and service support to our retail customers by assisting with category management, in-store merchandising and customized packaging. We also offer end users a broad array of services including product warranties, toll-free customer service numbers and web sites featuring extensive customer service information. Expertise in Successfully Identifying and Executing Complementary Acquisitions. We believe we have expertise in identifying and acquiring businesses or brands that complement our existing product portfolio. We utilize a systematic, disciplined acquisition strategy to identify candidates that can provide category leading product offerings to be sold through our existing distribution channels or new distribution channels for our existing products. This expertise has resulted in several important recent strategic acquisitions of complementary businesses and brands such as Tilia, Diamond and Lehigh, which have helped build our portfolio of niche consumer products used in and around the home and strengthened our distribution channels. Moreover, we have developed an operating infrastructure with the proven capability to successfully integrate acquisitions. We believe that our acquisition expertise uniquely positions us to take advantage of future opportunities to acquire complementary businesses or brands. Recurring Revenue Stream. We derive recurring and, we believe, annually stable sales from many of our leading products due to their affordability and position as fundamental staples within many households. Our jar closures, kitchen matches, plastic cutlery, rope, cord and twine and toothpicks exemplify these traits. Moreover, we believe that as the installed base of FoodSaver (Registered Trademark) appliances increases, our patented disposable storage bags and related accessories used with the FoodSaver (Registered Trademark) appliances will constitute an increasing percentage of revenues. In 2000, revenues from the sale of storage bags generated 18% of our consumer solutions segment net sales compared to approximately 27% for 2002. Low Cost Manufacturing. We believe we excel at manufacturing programs involving high volumes with superior efficiencies, low cost and exceptional quality. We have organized the production runs of our branded consumable product lines to minimize the number of manufacturing functions and the frequency of material handling. We also utilize, where practical, a flexible process which uses cellular manufacturing to allow a continuous flow of parts with minimal set up time. Our efficient and automated plastic cutlery manufacturing operations enable us to produce, count and package plastic cutlery ready for retail distribution with minimal labor costs. We also utilize an efficient outsourced manufacturing network of suppliers for certain of our branded consumables and consumer solutions products. Many of these relationships are long-term, affording us increased flexibility and stability in our operations. Appliances, bags and accessories are sourced from several facilities throughout Asia and the United States. This diverse network allows us to maintain multiple sources of quality products while keeping price points competitive and provides us with quick response, special order service and low-cost, high-volume production capacity. We believe our service levels, including fill rates, are attractive as compared to our competitors. Proprietary and Patented Technology. We believe we have proprietary expertise in the design, development and manufacture of certain of our products supported by patented technology, affording us a competitive advantage and enabling us to maintain our market leading positions. We maintain patents on our FoodSaver (Registered Trademark) home vacuum packaging systems and on the bags used for vacuum sealing. This patent protection and our well-developed manufacturing relationships have enabled us to become the market leader within the home vacuum packaging category. For our home canning products, we have developed a proprietary two-piece closure system incorporating a plastisol sealant that differentiates our jar lids from those of competitors. We also have several innovative new products in development for which patents are pending, including the next generation of home vacuum packaging bags and systems. S-3 Proven and Incentivized Management Team. Our management team has a proven track record of successful management with positive operating and shareholder results. Our management team is led by Martin E. Franklin, our Chairman and Chief Executive Officer, and Ian G.H. Ashken, our Vice Chairman and Chief Financial Officer, both of whom joined Jarden in 2001 and who collectively beneficially own approximately 7% of our common stock. We have also recently hired James E. Lillie to the newly created position of Chief Operating Officer to oversee day-to-day operations and operational integration. Each of our operating businesses is managed by professionals with an average of over 20 years of experience. Senior operating managers also participate in our equity incentive programs, and cash incentive compensation is primarily based on attaining selected financial performance targets. GROWTH STRATEGY Our objective is to increase revenue, cash flow and profitability while increasing our position as a leading manufacturer, marketer and distributor of niche, branded consumer products. Our strategy for achieving these objectives includes the following key elements: Further Penetrate Existing Distribution Channels. We will seek to further penetrate existing distribution channels to drive organic growth by capitalizing on our strong existing customer relationships and attracting new customers. We intend to further penetrate existing customers by continuing to (i) provide quality products, (ii) efficiently and consistently fulfill logistical requirements and volume demands, (iii) provide comprehensive product support from design to after-market customer service and (iv) cross-sell our branded consumables and consumer solutions products and accessories to our extensive combined customer base. As a result of our 2002 cross-selling initiatives, FoodSaver (Registered Trademark) products are now being sold through the grocery and hardware channels, where we previously sold primarily branded consumable products. Similarly, we believe there is potential to introduce our home canning products into leading home improvement retailers as a result of the Lehigh acquisition. We intend to attract new customers through our portfolio of leading brands, innovative products and superior customer service. Introduce New Products. To drive organic growth from our existing businesses, we intend to continue to leverage our strong brand names, customer relationships and proven capacity for innovation to expand product offerings in each of our major product categories. For example, our branded consumables business is targeting several new product introductions, with a recent focus on all-in-one Ball (Registered Trademark) home canning-related kits that provide consumers a simpler and more convenient experience. In 2002, we successfully introduced jelly and salsa kits and have introduced several additional kits in 2003. Other product line extensions in branded consumables include innovative packaging solutions that meet specific consumer needs and drive profitability such as the recently introduced Shake-A-Pick (Registered Trademark) , an individual toothpick dispenser. In addition, we have historically been able to cycle out old home improvement products and replace them with newer versions, enabling us to avoid price reductions and maintain attractive margins. Such changes include packaging and coloration modifications and redesigning products to improve functionality for garage storage solutions. Pursue Strategic Acquisitions. We anticipate that the fragmented nature of the niche consumer products market will continue to provide significant opportunities for growth through strategic acquisitions of complementary businesses. Our acquisition strategy will continue to focus on businesses or brands with product offerings that provide expansion into related categories and can be marketed through our existing distribution channels or provide us with new distribution channels for our existing products, thereby increasing marketing and distribution efficiencies. Furthermore, we seek acquisition candidates with attractive margins, strong cash flow characteristics, category leading positions and products that generate recurring revenue. Our acquisitions of Tilia, Diamond and Lehigh are examples of our ability to implement this acquisition strategy. We anticipate that future acquisitions will be financed through a combination of operating cash flow, debt and equity, including the proceeds of this offering. We are continuing to pursue several tuck-in acquisitions, all of which, if S-4 consummated, would have an aggregate purchase price of approximately $40 million. No assurances can be given that any such potential acquisition will be consummated or, if any such acquisition is consummated, as to the terms of such acquisition, including price. Expand Internationally. Historically, we have focused primarily on North American sales while establishing a limited sales presence internationally. In 2002, sales outside of North America represented less than 2% of sales. We intend to expand our international sales primarily by developing distribution channels for certain of our existing products and by pursuing strategic acquisitions of foreign businesses with established complementary distribution channels. We are in the early stages of implementing our proven North American home vacuum packaging product introduction strategy in Asia and Europe, where we have recently entered into limited distribution agreements for our FoodSaver (Registered Trademark) products. In these markets, we intend to follow the successful strategy we implemented in North America by initially utilizing direct to consumer sales, including infomercials, to build consumer awareness and generate retail demand. Once a critical mass of consumer sales and interest has been established, we intend to launch FoodSaver (Registered Trademark) products through traditional retail channels. THE LEHIGH ACQUISITION On September 2, 2003, we acquired Lehigh, the largest supplier of rope, cord and twine for the U.S. consumer marketplace and a leader in innovative storage and organization products for the home and garage as well as products in the security door and fencing market. Lehigh's customers include North America's largest and rapidly growing warehouse home centers and mass merchants. For the year ended December 31, 2002, Lehigh had revenues and operating income of $128.1 million and $18.9 million, respectively. We acquired Lehigh for cash consideration (excluding transaction costs) of $155.0 million at closing (the "Lehigh Acquisition"). In addition, the Lehigh Acquisition includes an earn-out provision with a potential payment in cash or our registered common stock of up to $25.0 million payable in 2006, provided that certain earnings performance targets are met. If paid, we expect to capitalize the cost of the earn-out. Strategically, Lehigh complements our existing consumer products businesses. The acquisition is consistent with our strategy of acquiring branded consumer products businesses with leading market positions in niche markets for products used in and around the home, attractive operating margins and strong management. The Lehigh acquisition (i) is expected to be accretive to earnings per share, (ii) provides cross-selling opportunities to our established retail customer base, (iii) adds complementary distribution channels to our strong domestic distribution network and (iv) has the potential to create cost synergies. The mailing address and telephone number of our principal executive offices are 555 Theodore Fremd Avenue, Suite B-302, Rye, NY 10580 and (914) 967-9400, respectively. S-5 THE OFFERING Common stock offered by Jarden Corporation...................................... 2,800,000 shares Common stock to be outstanding after this offering.............................. 17,408,654 shares(1) Over-allotment option............................ 420,000 shares Use of proceeds.................................. We intend to use the net proceeds from the sale of these equity securities for working capital and general corporate purposes, including, but not limited to, potential future acquisitions and debt repayment. If any of the proceeds are not used on or before February 29, 2004, we currently intend to use such remaining proceeds to repay a portion of our senior term credit facility. NYSE Market Symbol............................... JAH Risk Factors..................................... You should carefully consider the information set forth in "Risk Factors" and all other information included in this prospectus supplement and the accompanying prospectus before investing in our common stock. (1) The total number of shares of common stock outstanding after the offering is based on 14,608,654 shares of common stock outstanding on September 24, 2003. This number excludes: o 1,693,159 shares of common stock reserved for issuance upon the exercise of options outstanding as of September 24, 2003, at a weighted average exercise price of $18.26 per share; and o 1,796,069 shares of common stock reserved for future issuance under our 2003 stock incentive plan and 2003 employee stock purchase plan. The total number of shares outstanding includes 385,260 shares of common stock issued as restricted stock awards which have not vested as of September 24, 2003. The total number of shares outstanding after the offering also assumes no exercise of the underwriters' over-allotment option. Pursuant to our restated certificate of incorporation, as amended, we have 50,000,000 shares of common stock authorized. S-6 SUMMARY FINANCIAL DATA The following table sets forth our summary historical financial data for the years ended December 31, 2000, 2001 and 2002, which has been derived from our audited consolidated financial statements and related notes for the respective fiscal years, and our summary historical financial data for the six months ended June 30, 2002 and 2003, which has been derived from our unaudited consolidated financial statements and the related notes. Our results of operations for the interim periods are not indicative of the results that may be expected for the entire year. You should read the information in this table together with our financial statements and other financial information incorporated by reference into this prospectus. Our financial data was significantly affected by our acquisitions of Diamond in February 2003 and Tilia in April 2002 and the disposition of our underperforming thermoformed plastics operations in November 2001. Future financial data is likely to be significantly affected by our acquisition of Lehigh on September 2, 2003. As a result, our historical financial data is not necessarily comparable between periods, or to prior periods and may not be indicative of future performance. The summary unaudited pro forma data for the year ended December 31, 2002 and the six months ended June 30, 2003 has been derived from, and should be read in conjunction with, the unaudited pro forma consolidated financial information included in this prospectus. The unaudited pro forma statement of operations data reflects the Tilia, Diamond and Lehigh acquisitions as if they had occurred at January 1, 2002. The unaudited pro forma balance sheet data reflects the Lehigh acquisition as if it had occurred at June 30, 2003. The pro forma as adjusted balance sheet data at June 30, 2003 gives further effect to our sale of 2,800,000 shares of common stock in this offering, at the public offering price of $37 per share after deducting estimated underwriting discounts and commissions and offering expenses, and the application of proceeds from this offering. The unaudited pro forma financial information may not be indicative of our financial condition or results of operations that actually would have occurred had the Tilia, Diamond and Lehigh acquisitions been in effect on the dates indicated or the financial position and results of operations that may be obtained in the future. S-7
AS OF AND FOR THE YEAR ENDED DECEMBER 31, ------------------------------------------------------- PRO FORMA 2000 2001 2002 2002 ------------- ------------- ------------- ------------- (in thousands, except per share data) INCOME STATEMENT DATA: Net sales ................................ $ 356,123 $ 304,276 $ 367,104 $ 635,361 Gross profit ............................. 81,875 71,642 150,475 235,236 Special charges and reorganization expenses, net ........................... 380 4,978 -- 4,565 Loss on divestiture of assets and product lines ........................... -- 122,887 -- -- Operating income (loss) .................. 18,982 (113,928) 65,109 104,777 Net income (loss) ........................ 4,922 (85,429) 36,309 52,085 Diluted earnings (loss) per share ........ $ 0.39 $ (6.71) $ 2.52 $ 3.62 Diluted earnings (loss) per share, excluding one-time tax reversal (1) $ 0.39 $ (6.71) $ 2.22 $ 3.31 Diluted weighted average shares outstanding ............................. 12,766 12,726 14,392 14,392 OTHER FINANCIAL DATA: EBITDA (2) ............................... $ 40,552 $ (95,284) $ 75,110 $ 121,994 Cash flows from operating activities (3) . 19,144 39,857 69,551 Depreciation and amortization ............ 21,311 18,797 10,001 17,217 Capital expenditures ..................... 13,637 9,707 9,277 12,417 BALANCE SHEET DATA: Cash and cash equivalents ................ $ 3,303 $ 6,376 $ 56,779 Working capital .......................... 22,975 8,035 101,557 Total assets ............................. 310,429 162,234 366,765 Total debt ............................... 137,060 84,875 216,955 Total stockholders' equity ............... 118,221 35,129 76,764 AS OF AND FOR THE SIX MONTHS ENDED JUNE 30, ----------------------------------------- PRO FORMA 2002 2003 2003 ------------- ------------- ------------- (in thousands, except per share data) INCOME STATEMENT DATA: Net sales ................................ $ 152,177 $ 228,114 $ 302,583 Gross profit ............................. 54,657 87,850 109,660 Special charges and reorganization expenses, net ........................... -- -- 1,536 Loss on divestiture of assets and product lines ........................... -- -- -- Operating income (loss) .................. 21,849 31,544 42,966 Net income (loss) ........................ 15,280 14,181 18,725 Diluted earnings (loss) per share ........ $ 1.09 $ 0.96 $ 1.27 Diluted earnings (loss) per share, excluding one-time tax reversal (1) $ 0.74 $ 0.96 $ 1.27 Diluted weighted average shares outstanding ............................. 14,058 14,727 14,727 OTHER FINANCIAL DATA: EBITDA (2) ............................... $ 26,638 $ 38,774 $ 51,706 Cash flows from operating activities (3).. 47,153 15,193 Depreciation and amortization ............ 4,789 7,230 8,740 Capital expenditures ..................... 3,070 4,569 4,980 BALANCE SHEET DATA: Cash and cash equivalents ................ $ 38,618 $ 4,704 $ 4,834 Working capital .......................... 69,676 71,482 95,743 Total assets ............................. 337,668 440,746 610,991 Total debt ............................... 213,601 254,286 414,286 Total stockholders' equity ............... 58,204 96,384 96,384
PRO FORMA AS ADJUSTED ------------ Cash and cash equivalents .......... $102,504 Total debt ......................... 414,286 Total stockholders' equity ......... 194,054
(1) For the year ended December 31, 2002 and the six months ended June 30, 2002, the income tax provision included a one-time reversal of a tax valuation allowance resulting primarily from significant tax refunds received related to the 2001 tax year. Excluding the release of this valuation allowance, our effective tax rate would have been 39.2% for the year ended December 31, 2002 and 38.4% for the six months ended June 30, 2002. A reconciliation of our net income and related diluted earnings per share excluding this release is presented below:
FOR THE FOR THE YEAR ENDED SIX MONTHS DECEMBER 31, ENDED JUNE 30, --------------------------- --------------- PRO FORMA 2002 2002 2002 ------------ ------------ --------------- (dollars in thousands, except per share data) Income before taxes ................................................. $ 52,498 $ 78,444 $ 16,864 Income tax provision, excluding one-time tax reversal ............... 20,579 30,750 6,479 -------- -------- -------- Net income, excluding one-time tax reversal ......................... $ 31,919 $ 47,694 $ 10,385 ======== ======== ======== Diluted earnings per share, excluding one-time tax reversal ......... $ 2.22 $ 3.31 $ 0.74
(2) For the year ended December 31, 2001, EBITDA includes a $122,887 loss on divestiture of assets and product lines. EBITDA is not intended to represent cash flow from operations as defined by accounting principles generally accepted in the United States and should not be used as an alternative to net income as an indicator of operating performance or to cash flow as a measure of liquidity. EBITDA is included in this prospectus because it is a basis upon which our management assesses financial performance. While EBITDA is frequently used as a measure of operations and the ability S-8 to meet debt service requirements, it is not necessarily comparable to other similarly titled captions of other companies due to potential inconsistencies in the method of calculation. A reconciliation of the calculation of EBITDA is presented below:
FOR THE YEAR ENDED DECEMBER 31, FOR THE SIX MONTHS ENDED JUNE 30, ----------------------------------------------- --------------------------------- PRO FORMA PRO FORMA 2000 2001 2002 2002 2002 2003 2003 --------- -------------- ---------- ----------- ---------- ---------- ---------- (dollars in thousands) Net income (loss) ......... $ 4,922 $ (85,429) $36,309 $ 52,085 $15,280 $14,181 $18,725 Interest expense, net ..... 11,917 11,791 12,611 26,333 4,985 8,219 12,168 Income tax provision (benefit) ................ 2,402 (40,443) 16,189 26,359 1,584 9,144 12,073 Depreciation and amortization ............. 21,311 18,797 10,001 17,217 4,789 7,230 8,740 ------- ---------- ------- -------- ------- ------- ------- EBITDA .................... $40,552 $ (95,284) $75,110 $121,994 $26,638 $38,774 $51,706 ======= ========== ======= ======== ======= ======= =======
(3) For the year ended December 31, 2002, cash flows from operations included $38.6 million of income tax refunds resulting primarily from the 2001 loss on divestiture of assets. S-9 SUMMARY FINANCIAL DATA OF LEHIGH The following table sets forth Lehigh's summary financial data for the years ended December 31, 2000, 2001 and 2002 which has been derived from Lehigh's audited consolidated financial statements. The following table also sets forth Lehigh's summary historical financial data for the six months ended June 30, 2002 and 2003 which has been derived from Lehigh's interim unaudited consolidated financial statements. This summary financial data is not necessarily indicative of the results of future operations and should be read in conjunction with the audited consolidated financial statements of Lehigh as of and for the year ended December 31, 2002 and the unaudited interim condensed financial statements of Lehigh for the six months ended June 30, 2003 incorporated by reference herein. The financial statements of Lehigh as of and for the years ended December 31, 2000 and 2001 are not included herein. This summary financial data should also be read in conjunction with the unaudited pro forma condensed consolidated financial data of Jarden included herein.
SIX MONTHS ENDED JUNE YEAR ENDED DECEMBER 31, 30, -------------------------------------- ----------------------- 2000 (1) 2001 2002 2002 2003 ---------- ----------- ----------- ---------- ---------- (dollars in thousands) INCOME STATEMENT DATA: Net sales ............................. $96,296 $123,477 $128,128 $65,349 $67,655 Gross profit .......................... 26,679 35,741 38,424 18,325 20,193 Operating income (2) .................. 10,392 13,153 18,892 9,506 11,168 Net income ............................ 5,821 9,981 16,638 8,487 10,563 OTHER FINANCIAL DATA: Depreciation and amortization ......... $ 4,250 $ 6,716 $ 2,164 $ 1,203 $ 975 Capital expenditures .................. 1,002 537 454 231 211
- ---------- (1) On January 31, 2000, Lehigh acquired all of the stock of M&K Industries, Inc. On February 16, 2000, Lehigh acquired the net assets of Ultra-Hold Corporation. On September 29, 2000, Lehigh acquired certain assets of Leslie Locke Corporation. The acquisitions were accounted for using the purchase method and as such, the results of operations of the acquired businesses were included from the date of acquisition. Accordingly, the consolidated results are not necessarily comparable to the other periods presented. (2) Operating income as presented above excludes other expense of $153, $140 and $380 for the years ended December 31, 2000, 2001 and 2002, respectively. S-10 RISK FACTORS Investing in our securities involves risks, including the risks described in this prospectus supplement, the accompanying prospectus, and in the other documents that are incorporated herein by reference. You should carefully consider the risk factors together with all of the other information and data included in this prospectus supplement, the accompanying prospectus and the documents that are incorporated herein by reference before you decide to acquire any securities. If any of the events described in the section captioned "Risk Factors" contained in this prospectus supplement and the accompanying prospectus or in the events described in the documents incorporated herein by reference actually occur, our business, financial condition or results of operation may suffer. REDUCTIONS, CANCELLATIONS, OR DELAYS IN CUSTOMER PURCHASES COULD ADVERSELY AFFECT OUR PROFITABILITY. Our customers generally do not enter into long-term contracts or commitments with us. As a result, these customers may cancel their orders, change purchase quantities from forecast volumes, or delay purchases for a number of reasons beyond our control. Significant or numerous cancellations, reductions, or delays in purchases by customers could have a material adverse effect on our business, results of operations and financial condition. In addition, because many of our costs are fixed, a reduction in customer demand could have an adverse effect on our gross profit and operating income. On a historical basis in 2002, one customer, Wal-Mart, accounted for 18.7% of our consolidated net sales. On a pro forma basis, giving effect to the Tilia, Diamond and Lehigh acquisitions, Wal-Mart accounted for 18.9% of our 2002 consolidated net sales and Home Depot accounted for 13.0% of our 2002 consolidated net sales. A significant reduction in purchases from either of these customers could have a material adverse effect on our business, results of operations and financial condition. WE MAY EXPERIENCE DIFFICULTY IN INTEGRATING ACQUIRED BUSINESSES, WHICH MAY INTERRUPT OUR BUSINESS OPERATIONS. We have achieved growth through the acquisition of companies, including the recent acquisition of Lehigh. There can be no assurance that we will be able to integrate successfully the Lehigh business into our existing business without substantial costs, delays or other operational or financial difficulties. Additionally, the failure of Lehigh's business to achieve expected results, diversion of our management's attention, and failure to retain key Lehigh personnel, could have a material adverse effect on our business, results of operations and financial condition. OUR BUSINESS COULD BE ADVERSELY AFFECTED BECAUSE OF RISKS ASSOCIATED WITH INTERNATIONAL OPERATIONS. Although not currently material to our operations, we anticipate that international sales will be a growth area for our business. International operations, including manufacturing and sourcing operations (and the international operations of our customers), are subject to inherent risks which could adversely affect us, including, among other things: o fluctuations in the value of currencies; o unexpected changes in and the burdens and costs of compliance with a variety of foreign laws; o political and economic instability; o increases in duties and taxation; and o reversal of the current policies (including favorable tax and lending policies) encouraging foreign investment or foreign trade by our host countries. CLAIMS MADE AGAINST US BASED ON PRODUCT LIABILITY COULD HAVE A MATERIAL ADVERSE EFFECT ON OUR BUSINESS. As a producer and marketer of consumer products, we are subject to the risk of claims for product liability. We maintain product liability insurance, but there is a risk that our coverage will not be sufficient to insure against all claims which may be brought against us, or that we will not be able to S-11 maintain that coverage or obtain additional insurance covering existing or new products. If a product liability claim exceeding our insurance coverage were to be successfully asserted against us, it could have a material adverse effect on our business, results of operations and financial condition. Additionally, certain of the products manufactured and sold by Lehigh are used in applications where the failure to use such products for their intended purposes, the failure to use them properly, or their malfunction, generally could result in greater injury than our other products. OUR FAILURE TO SUCCESSFULLY PROTECT OUR INTELLECTUAL PROPERTY RIGHTS COULD HAVE A MATERIAL ADVERSE EFFECT ON OUR BUSINESS. Our success with our proprietary products depends, in part, on our ability to protect our current and future technologies and products and to defend our intellectual property rights. If we fail to adequately protect our intellectual property rights, competitors may manufacture and market products similar to ours. We cannot be sure that we will receive patents for any of our patent applications or that any existing or future patents that we receive or license will provide competitive advantages for our products. We also cannot be sure that competitors will not challenge, invalidate or avoid the application of any existing or future patents that we receive or license. In addition, patent rights may not prevent our competitors from developing, using or selling products that are similar or functionally equivalent to our products. Furthermore, the patents we maintain on the bags used for vacuum sealing expire in 2005 and the patents we maintain on our home vacuum packaging systems expire in 2009. We are currently applying for patents on new bags and vacuum packaging systems that we recently acquired. Our Tilia subsidiaries, Tilia, Inc. and Tilia International, Inc., have filed a complaint with the International Trade Commission against Applica Consumer Products, Inc., Applica, Inc., The Rival Company, The Holmes Group, Inc. and ZeroPack Co. Ltd., to enjoin the importation into the U.S. of certain competitive home vacuum packaging products that we believe infringes on our patented technology. If the International Trade Commission fails to issue an injunction blocking the importation of these products, we believe that our consumer solutions business may be irreparably harmed by (i) being forced to sell products at reduced margins and (ii) having the entire market for home vacuum packaging products disrupted by the introduction of low quality products, and that we could suffer a material adverse effect on our business, results of operations and financial condition. OUR SIGNIFICANT INDEBTEDNESS COULD ADVERSELY AFFECT OUR FINANCIAL HEALTH AND PREVENT US FROM FULFILLING OUR DEBT OBLIGATIONS. We have a significant amount of indebtedness which could: o make it more difficult for us to satisfy our obligations with respect to the debt securities; o increase our vulnerability to general adverse economic and industry conditions; o require us to dedicate a substantial portion of our cash flow from operations to payments on our indebtedness, thereby reducing the availability of our cash flow to fund working capital, capital expenditures, acquisitions and investments and other general corporate purposes; o limit our flexibility in planning for, or reacting to, changes in our business and the markets in which we operate; o place us at a competitive disadvantage compared to our competitors that have less debt; and o limit, among other things, our ability to borrow additional funds. S-12 The following table sets forth our total debt, total stockholders' equity, total capitalization and ratio of debt to total capitalization on a pro forma basis giving effect to the Tilia, Diamond and Lehigh acquisitions and our amended and restated senior credit facility: JUNE 30, 2003 ----------------------- (unaudited) (dollars in thousands) Total debt .................................... $ 414,286 Total stockholders' equity .................... 96,384 --------- Total capitalization .......................... $ 510,670 ========= Ratio of debt to total capitalization ......... 81% The terms of our amended and restated senior credit facility, the April 24, 2002 indenture, as supplemented, governing our 9 3/4% senior subordinated notes due 2012, and the January 29, 2003 indenture, as supplemented, governing our 9 3/4% senior subordinated notes due 2012, allow us to issue and incur additional debt upon satisfaction of certain conditions. If new debt is added to current debt levels, the related risks described above could increase. See "Management's Discussion and Analysis of Financial Condition and Results of Operations -- The Lehigh Acquisition and Related Financing, Financial Condition, Liquidity and Capital Resources" included in this prospectus supplement and Item 5, "Amendment and Restatement of Existing Credit Facility", of our Form 8-K, filed on September 5, 2003. S-13 FORWARD-LOOKING STATEMENTS Certain statements we make in this prospectus supplement, the accompanying prospectus, and other written or oral statements by us or our authorized officers on our behalf, may constitute "forward- looking statements" within the meaning of the Federal securities laws. Forward-looking statements include statements concerning our plans, objectives, goals, strategies, future events, future revenues or performance, capital expenditures, financing needs, plans or intentions relating to acquisitions, our competitive strengths and weaknesses, our business strategy and the trends we anticipate in the industry and economies in which we operate and other information that is not historical information. Words or phrases such as "estimates," "expects," "anticipates," "projects," "plans," "intends," "believes" and variations of such words or similar expressions are intended to identify forward-looking statements. All forward-looking statements, including, without limitation, our examination of historical operating trends, are based upon our current expectations and various assumptions. Our expectations, beliefs and projections are expressed in good faith, and we believe there is a reasonable basis for them, but we cannot assure you that our expectations, beliefs and projections will be realized. Before you invest in our common stock or debt securities, you should be aware that the occurrence of the events described under the caption "Risk Factors" contained in this prospectus supplement and in the accompanying prospectus and otherwise discussed elsewhere in this prospectus supplement, the accompanying prospectus, or in materials incorporated in this prospectus by reference to our other filings with the Securities and Exchange Commission, could have a material adverse effect on our business, financial condition and results of operations. The data included in this prospectus supplement regarding markets and ranking, including the size of certain markets and our position and the position of our competitors within these markets, are based on independent industry publications, reports of government agencies or other published industry sources or our estimates based on management's knowledge and experience in the markets in which we operate. Our estimates have been based on information provided by customers, suppliers, trade and business organizations and other contacts in the markets in which we operate. We believe these estimates to be accurate as of the date of this prospectus supplement. However, this information may prove to be inaccurate because of the method by which we obtained some of the data for our estimates or because this information cannot always be verified with complete certainty due to the limits on the availability and reliability of raw data, the voluntary nature of the data gathering process and other limitations and uncertainties inherent in a survey of market size. As a result, you should be aware that market, ranking and other similar data included in this prospectus supplement, and estimates and beliefs based on that data, may not be reliable. S-14 USE OF PROCEEDS We intend to use the net proceeds from the sale of these equity securities for working capital and general corporate purposes, including, but not limited to, potential future acquisitions and debt repayment. If any of the proceeds are not used on or before February 29, 2004, we currently intend to use such remaining proceeds to repay a portion of our senior term credit facility. PRICE RANGE OF COMMON STOCK AND DIVIDEND POLICY Our common stock is quoted on the New York Stock Exchange under the symbol "JAH." The table below sets forth the high and low prices of our common stock as reported on the New York Stock Exchange for the periods indicated. HIGH LOW ---------- ---------- 2001 First Quarter ..................................... $ 7.56 $ 6.15 Second Quarter .................................... 8.07 5.82 Third Quarter ..................................... 6.51 5.35 Fourth Quarter .................................... 8.02 5.65 2002 First Quarter ..................................... $ 15.00 $ 7.57 Second Quarter .................................... 19.96 13.25 Third Quarter ..................................... 27.46 18.35 Fourth Quarter .................................... 27.70 20.00 2003 First Quarter ..................................... $ 28.25 $ 21.86 Second Quarter .................................... 32.68 25.45 Third Quarter (through September 25, 2003) ........ 40.26 26.50 We intend to retain earnings to finance our future growth, and we have no current plans to pay cash dividends to our stockholders. The payment of any future cash dividends will be at the sole discretion of our board of directors and will depend upon, among other things, our future earnings, our capital requirements, and our general financial condition. We are currently limited in our ability to pay dividends on our common stock by our senior credit facility and the indentures under which our senior subordinated notes are issued. S-15 CAPITALIZATION The following table sets forth our cash and cash equivalents and capitalization as of June 30, 2003, on an actual basis, a pro forma basis and an as adjusted basis. The pro forma information gives effect to the acquisition of Lehigh on September 2, 2003, including the related financing. The as adjusted information gives further effect to the common stock offering contemplated herein at the offering price of $37 and after deducting estimated underwriting discounts and commissions and offering expenses. This table should be read in conjunction with "Use of Proceeds" and "Selected Financial Data." It should also be read in conjunction with our unaudited pro forma condensed consolidated financial statements and our audited and unaudited financial statements, including the related notes, included in and incorporated by reference into this prospectus.
AS OF JUNE 30, 2003 --------------------------------------- ACTUAL PRO FORMA AS ADJUSTED ---------- ----------- ------------ (dollars in thousands) Cash and cash equivalents ................... $ 4,704 $ 4,834 $102,504 ======== ======== ======== Debt, including current installments: Senior credit facility: Revolving credit facility ................ $ 6,300 $ 16,300 $ 16,300 Term loans ............................... 54,473 204,473 204,473 Senior subordinated notes due 2012 ......... 179,844 179,844 179,844 Subordinated seller note due 2004 .......... 5,294 5,294 5,294 Interest rate swap liabilities ............. 8,375 8,375 8,375 -------- -------- -------- Total debt .............................. 254,286 414,286 414,286 Total stockholders' equity .................. 96,384 96,384 194,054 -------- -------- -------- Total capitalization .................... $350,670 $510,670 $608,340 ======== ======== ========
S-16 SELECTED FINANCIAL DATA The following table sets forth our selected financial data as of and for the years ended December 31, 1998, 1999, 2000, 2001 and 2002 and the six months ended June 30, 2002 and 2003. The selected financial data set forth below for the five years ended December 31, 2002 have been derived from our audited consolidated financial statements and related notes thereto where applicable for the respective periods presented. The selected financial data as of and for the six months ended June 30, 2002 and 2003 has been derived from our unaudited consolidated financial statements and related notes thereto where applicable for the respective periods presented. The selected financial data should be read in conjunction with "Management's Discussion and Analysis of Financial Condition and Results of Operations" as well as our consolidated financial statements and notes thereto contained in, or incorporated by reference into, this prospectus. These historical results are not necessarily indicative of the results to be expected in the future. The results of Tilia and Diamond are included from April 1, 2002 and February 1, 2003, respectively. The results of Lehigh are not included in any of the historical periods presented.
AS OF AND FOR THE YEAR ENDED DECEMBER 31, ------------------------------------------------------------------ 1998 (1) 1999 (2) 2000 (3) 2001 (4) 2002 (5) ------------ ------------ ------------ ------------- ------------- (dollars in thousands, except per share data) STATEMENT OF OPERATIONS DATA: Net sales ...................................$258,210 $356,525 $356,123 $ 304,276 $367,104 Costs and expenses Cost of sales .............................. 187,295 256,201 274,248 232,634 216,629 Selling, general and administrative expenses .................................. 38,052 54,923 56,109 52,552 85,366 Goodwill amortization ...................... 1,399 4,605 6,404 5,153 -- Special charges and reorganization expenses, net (7) ......................... 1,260 2,314 380 4,978 -- Loss (gain) on divestiture of assets and product lines ............................. -- (19,678) -- 122,887 -- -------- -------- -------- --------- -------- Operating income (loss) ..................... 30,204 58,160 18,982 (113,928) 65,109 Interest expense, net ....................... 1,822 8,395 11,917 11,791 12,611 Loss from early extinguishment of debt (8) ................................... -- 1,663 -- -- -- Income tax provision (benefit) (9) .......... 10,785 18,823 2,402 (40,443) 16,189 Minority interest in gain (loss) of consolidated subsidiary .................... -- -- (259) 153 -- -------- -------- -------- --------- -------- Income (loss) from continuing operations..... 17,597 29,279 4,922 (85,429) 36,309 Loss from discontinued operations ........... (1,870) (87) -- -- -- -------- -------- -------- --------- -------- Net income (loss) ........................... $15,727 $29,192 $ 4,922 $ (85,429) $36,309 ======== ======== ======== ========= ======== Basic earnings (loss) per share (10): Income (loss) from continuing operations..... $ 1.24 $ 2.18 $ 0.39 $ (6.71) $ 2.60 Loss from discontinued operations ........... ( .13) ( .01) -- -- -- -------- -------- -------- --------- -------- $ 1.11 $ 2.17 $ 0.39 $ (6.71) $ 2.60 ======== ======== ======== ========= ======== Diluted earnings (loss) per share (10): Income (loss) from continuing operations..... $ 1.22 $ 2.15 $ 0.39 $ (6.71) $ 2.52 Loss from discontinued operations ........... ( .13) ( .01) -- -- -- -------- -------- -------- --------- -------- $ 1.09 $ 2.14 $ 0.39 $ (6.71) $ 2.52 ======== ======== ======== ========= ======== OTHER FINANCIAL DATA: EBITDA (11) ................................. $40,752 $74,194 $40,552 $ (95,284) $75,110 Cash flows from operating activities (12).... 27,388 22,324 19,144 39,857 69,551 Depreciation and amortization ............... 10,548 17,697 21,311 18,797 10,001 Capital expenditures ........................ 11,909 16,628 13,637 9,707 9,277 BALANCE SHEET DATA: Cash and cash equivalents ................... $21,454 $17,394 $ 3,303 $ 6,376 $56,779 Working capital ............................. 46,923 54,611 22,975 8,035 101,557 Total assets ................................ 166,974 340,364 310,429 162,234 366,765 Total debt .................................. 25,715 140,761 137,060 84,875 216,955 Total stockholders' equity .................. 94,893 123,025 118,221 35,129 76,764 AS OF AND FOR THE SIX MONTHS ENDED JUNE 30, --------------------------- 2002 (5) 2003 (6) ------------- ------------- STATEMENT OF OPERATIONS DATA: Net sales ...................................$152,177 $228,114 Costs and expenses Cost of sales .............................. 97,520 140,264 Selling, general and administrative expenses .................................. 32,808 56,306 Goodwill amortization ...................... -- -- Special charges and reorganization expenses, net (7) ......................... -- -- Loss (gain) on divestiture of assets and product lines ............................. -- -- -------- -------- Operating income (loss) ..................... 21,849 31,544 Interest expense, net ....................... 4,985 8,219 Loss from early extinguishment of debt (8) ................................... -- -- Income tax provision (benefit) (9) .......... 1,584 9,144 Minority interest in gain (loss) of consolidated subsidiary .................... -- -- -------- -------- Income (loss) from continuing operations..... 15,280 14,181 Loss from discontinued operations ........... -- -- -------- -------- Net income (loss) ........................... $15,280 $14,181 ======== ======== Basic earnings (loss) per share (10): Income (loss) from continuing operations..... $ 1.11 $ 1.00 Loss from discontinued operations ........... -- -- -------- -------- $ 1.11 $ 1.00 ======== ======== Diluted earnings (loss) per share (10): Income (loss) from continuing operations..... $ 1.09 $ 0.96 Loss from discontinued operations ........... -- -- -------- -------- $ 1.09 $ 0.96 ======== ======== OTHER FINANCIAL DATA: EBITDA (11) ................................. $26,638 $38,774 Cash flows from operating activities (12).... 47,153 15,193 Depreciation and amortization ............... 4,789 7,230 Capital expenditures ........................ 3,070 4,569 BALANCE SHEET DATA: Cash and cash equivalents ................... $38,618 $ 4,704 Working capital ............................. 69,676 71,482 Total assets ................................ 337,668 440,746 Total debt .................................. 213,601 254,286 Total stockholders' equity .................. 58,204 96,384
- ---------- (1) 1998 includes a $1.3 million pretax charge to exit a plastic injection molding facility. (2) 1999 includes a $19.7 million pretax gain on the sale of the plastic packaging product line and a $2.3 million pretax charge to exit a plastic thermoforming facility. (3) 2000 includes $1.6 million of pretax income associated with the reduction in long-term performance-based compensation, $1.4 million in pretax litigation charges, net of recoveries and $0.6 million of pretax costs to evaluate strategic options. S-17 (4) 2001 includes a $121.1 million pretax loss on the November 2001 sale of thermoforming assets, a $2.3 million pretax charge associated with corporate restructuring, a $1.4 million pretax loss on the November 2001 sale of our interest in Microlin, LLC, $2.6 million of pretax separation costs related to the management reorganization, $1.4 million of pretax costs to evaluate strategic options, $1.4 million of pretax costs to exit facilities, a $2.4 million pretax charge for stock option compensation, $4.1 million of pretax income associated with the discharge of deferred compensation obligations and a $1.0 million pretax gain related to an insurance recovery. (5) The results of Tilia are included from April 1, 2002. (6) The results of Diamond are included from February 1, 2003. (7) Special charges and reorganization expenses, net were comprised of costs to evaluate strategic options, discharge of deferred compensation obligations, separation costs for former officers, stock option compensation, corporate restructuring costs, costs to exit facilities, reduction of long-term performance based compensation, litigation charges and items related to our divested thermoforming operations. (8) Pursuant to our adoption of SFAS No. 145, results for the year ended December 31, 1999 have been restated to give effect to the reclassification of a charge of $1.6 million ($1.0 million, net of taxes) arising from the early extinguishment of debt previously presented as an extraordinary item. (9) 2002 includes a net release of a $4.4 million tax valuation allowance. Adjusting for the net release of the valuation allowance, our diluted earnings per share for 2002 would have been $2.22. (10) All earnings per share amounts have been adjusted to give effect to a 2-for-1 split of our outstanding shares of common stock that was effected during the second quarter of 2002. (11) For the year ended December 31, 2001, EBITDA includes a $122.9 million loss on divestiture of assets and product lines. EBITDA is not intended to represent cash flow from operations as defined by accounting principles generally accepted in the United States and should not be used as an alternative to net income as an indicator of operating performance or to cash flow as a measure of liquidity. EBITDA is included in this prospectus because it is a basis upon which our management assesses financial performance. While EBITDA is frequently used as a measure of operations and the ability to meet debt service requirements, it is not necessarily comparable to other similarly titled captions of other companies due to potential inconsistencies in the method of calculation. A reconciliation of the calculation of EBITDA is presented below:
FOR THE SIX MONTHS FOR THE YEAR ENDED DECEMBER 31, ENDED JUNE 30, --------------------------------------------------------- -------------------- 1998 (1) 1999 (2) 2000 (3) 2001 (4) 2002 (5) 2002 (5) 2003 (6) ---------- ---------- ---------- ------------- ---------- ---------- --------- (dollars in thousands) Income (loss) from continuing operations ............................ $17,597 $29,279 $ 4,922 $ (85,429) $36,309 $15,280 $14,181 Interest expense, net .................. 1,822 8,395 11,917 11,791 12,611 4,985 8,219 Income tax provision (benefit) ......... 10,785 18,823 2,402 (40,443) 16,189 1,584 9,144 Depreciation and amortization .......... 10,548 17,697 21,311 18,797 10,001 4,789 7,230 ------- ------- ------- ---------- ------- ------- ------- EBITDA ................................. $40,752 $74,194 $40,552 $ (95,284) $75,110 $26,638 $38,774 ======= ======= ======= ========== ======= ======= =======
(12) For the year ended December 31, 2002, cash flows from operations included $38.6 million of income tax refunds resulting primarily from the 2001 loss on divestiture of assets. S-18 MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS The following discussion and analysis should be read in conjunction with our Selected Financial Data as well as our consolidated financial statements and notes thereto incorporated by reference herein. Jarden is a leading provider of niche consumer products used in and around the home, under well-known brand names including Ball (Registered Trademark) , Bernardin (Registered Trademark) , Crawford (Registered Trademark) , Diamond (Registered Trademark) , FoodSaver (Registered Trademark) , Forster (Registered Trademark) , Kerr (Registered Trademark) , Lehigh (Registered Trademark) and Leslie-Locke (Registered Trademark) . In North America, we are the market leader in several categories, including branded retail plastic cutlery, home canning, home vacuum packaging, kitchen matches, rope, cord and twine and toothpicks. We also manufacture zinc strip and a wide array of plastic products for third party consumer product and medical companies, as well as our own businesses. We have grown by actively acquiring new brands and expanding sales of our existing brands. Our strategy to achieve future growth is to acquire new brands, sustain profitable internal growth and expand our international business. On February 7, 2003, we completed our acquisition of the business of Diamond Brands International, Inc. and its subsidiaries ("Diamond"), a manufacturer and distributor of kitchen matches, toothpicks and retail plastic cutlery under the Diamond (Registered Trademark) and Forster (Registered Trademark) trademarks, pursuant to an asset purchase agreement ("Diamond Acquisition"). The Diamond Acquisition was entered into as part of our plan to pursue growth in branded consumer products. The purchase price of this transaction was approximately $92 million, including transaction costs and a deferred payment in the amount of $5.8 million paid in cash on August 7, 2003. We used cash on hand and draw downs under our debt facilities to finance the transaction. The acquired plastic manufacturing operation is included in the plastic consumables segment in 2003 and the acquired wood manufacturing operation and branded product distribution business is included in the branded consumables segment in 2003. In the second quarter of 2003, the Company completed its acquisition of O.W.D., Incorporated and Tupper Lake Plastics, Incorporated (collectively "OWD"). On April 24, 2002, we completed our acquisition of the business of Tilia International, Inc. and its subsidiaries (collectively "Tilia"), pursuant to an asset purchase agreement (the "Tilia Acquisition"). We acquired the business of Tilia for approximately $145 million in cash and $15 million in seller debt financing. In addition, the Tilia Acquisition includes an earn-out provision with a potential payment in cash or our common stock, at our sole discretion, of up to $25 million payable in 2005, provided that certain earnings performance targets are met. Effective November 26, 2001, we sold the assets of our Triangle, TriEnda and Synergy World plastic thermoforming operations ("TPD Assets") to Wilbert, Inc. for $21.0 million in cash, a non-interest bearing one-year note ("Wilbert Note") as well as the assumption of certain identified liabilities. The carrying amount on the Wilbert Note of $1.6 million was repaid on November 25, 2002. In connection with this sale, we recorded a pre-tax loss of approximately $121.1 million in 2001. The proceeds from the sale were used to pay down the Company's term debt under its old credit agreement. Effective November 1, 2001, we sold our majority interest in Microlin, LLC ("Microlin"), a developer of proprietary battery and fluid delivery technology, for $1,000 in cash plus contingent consideration based upon future performance through December 31, 2012 and the cancellation of future funding requirements. We recorded a pretax loss of $1.4 million in 2001 related to the sale. On September 24, 2001, our board of directors appointed Martin E. Franklin as our Chairman and Chief Executive Officer and Ian G.H. Ashken as our Vice Chairman, Chief Financial Officer and Secretary. Following this appointment we undertook a new business and management strategy to concentrate on niche, branded consumer products. During 2002, we revised our business segment information to report four business segments: branded consumables, consumer solutions, plastic consumables and other. Prior periods have been reclassified to conform to the current segment definitions. S-19 THE LEHIGH ACQUISITION AND RELATED FINANCING On September 2, 2003, we acquired Lehigh, the largest supplier of rope, cord and twine for the U.S. consumer marketplace and a leader in innovative storage and organization products for the home and garage as well as products in the security door and fencing market. Lehigh's customers include North America's largest and rapidly growing warehouse home centers and mass merchants. For the year ended December 31, 2002, Lehigh had revenues and operating income of $128.1 million and $18.9 million, respectively. We acquired Lehigh for cash consideration (excluding transaction costs) of $155.0 million at closing (the "Lehigh Acquisition"). In addition, the Lehigh Acquisition includes an earn-out provision with a potential payment in cash or our registered common stock of up to $25.0 million payable in 2006, provided that certain earnings performance targets are met. If paid, we expect to capitalize the cost of the earn-out. In connection with the Lehigh Acquisition, we amended and restated our existing senior credit facility. Our amended and restated senior credit facility provides for a senior credit facility of up to $280.0 million of senior secured loans, consisting of a $70.0 million five-year revolving credit facility, a $60.0 million five-year term loan facility, and a new $150.0 million five-year term loan facility. The revolving credit facility continues to have a $15.0 million letters of credit sublimit and a $10.0 million swing line loans sublimit. On September 2, 2003, we drew down the full amount of the new $150.0 million term loan facility, which funds were used principally to pay the cash consideration for the Lehigh Acquisition. RESULTS OF OPERATIONS -- COMPARISON OF SIX MONTHS ENDED JUNE 30, 2003 TO SIX MONTHS ENDED JUNE 30, 2002 We reported net sales of $228.1 million in the first six months of 2003, a 49.9% increase from net sales of $152.2 million in the first six months of 2002. In the first six months of 2003, our branded consumables segment reported net sales of $100.4 million compared to $63.5 million in the first six months of 2002. This increase of 58.0% was principally a result of the Diamond Acquisition, effective February 1, 2003. In addition, the acquisition of OWD in the second quarter of 2003 contributed to this increase. Partially offsetting these effects was a decrease in net sales for the remainder of this segment primarily due to a weaker retail environment in the first half of 2003. In the first six months of 2003, our consumer solutions segment reported net sales of $75.4 million compared to $31.3 million in net sales for the first six months of 2002. This increase of 140.7% was principally the result of this segment being acquired effective April 2002 and, therefore, net sales for the first six months of 2003 reflects sales for the full six month period but net sales for the first six months of 2002 reflects sales for only a part of the six month period. Additionally, it is a result of increased U.S. retail sales and international sales for this segment in the second quarter of 2003 compared to the second quarter of 2002. In the first six months of 2003, our plastic consumables segment reported net sales of $50.2 million compared to $37.1 million in the first six months of 2002. The principal reason for this increase of 35.5% was intercompany sales generated by the addition of the plastic manufacturing business acquired in the Diamond Acquisition. In addition, the intercompany sales resulting from the OWD acquisition in the second quarter of 2003 also contributed to this increase. Partially offsetting these effects was a decline in net sales caused by a contractual sales price reduction to a large customer. In the first six months of 2003, our other segment reported net sales of $17.9 million compared to $20.7 million in the first six months of 2002. The principal reason for this decrease of 13.8% was a reduction in our low denomination international coinage business due to less demand from a major customer. We reported operating income of $31.5 million in the first six months of 2003 compared to operating income of $21.8 million in the first six months of 2002. The principal reason for this increase of S-20 $9.7 million, or 44.4%, was the addition of the consumer solutions business effective April 2002. Additionally, the branded consumables segment's operating earnings increased by $3.3 million from the first six months of 2002 to the first six months of 2003, due to the addition of the Diamond product lines, partially offset by a decrease in operating earnings caused by a decrease in net sales for the remainder of this segment as discussed above. Partially offsetting these effects was a decrease in our other business segment's operating earnings from $3.7 million in the first six months of 2002 to $2.9 million in the first six months of 2003 due to the effect of its lower net sales. Operating income in the first six months of 2003 for our plastic consumables segment was comparable with the same period in the prior year for the same factors as discussed above under the net sales explanation. Gross margin percentages on a consolidated basis increased to 38.5% in the first six months of 2003 from 35.9% in the first six months of 2002. This increase is principally the result of including the higher gross margins of the acquired consumer solutions business for the full six month period in 2003 but only part of the six month period in 2002. Selling, general and administrative expenses increased to $56.3 million in the first six months of 2003 from $32.8 million in the first six months of 2002, or, as a percentage of net sales, increased to 24.7% in the first six months of 2003 from 21.6% in the first six months of 2002. This increase was principally due to the acquisition of the consumer solutions business and the additional selling, general and administrative expenses related to the new product lines in the branded consumables segment, primarily resulting from the Diamond Acquisition. Net interest expense increased to $8.2 million for the first six months of 2003 compared to $5.0 million in the same period last year. This increase resulted from higher levels of outstanding debt in 2003 compared to the same period in 2002, principally due to the financing of the Tilia Acquisition and the Diamond Acquisition and the issuance of $30 million of notes under our shelf registration statement. Our weighted average interest rate in the first six months of 2003 was comparable to the first six months of 2002. Our effective tax rate for the first six months of 2003 was 39.2% compared to an effective tax rate of 9.4% in the first six months of 2002. At December 31, 2001, we had federal net operating losses that were recorded as a deferred tax asset with a valuation allowance of $5.4 million. Due to the impact of the Job Creation Act and the tax refunds that we received as a result, a net $4.9 million of this valuation allowance was released in the first six months of 2002 resulting in an income tax provision of $1.6 million. Excluding the release of this valuation allowance our effective tax rate was approximately 38.4% in the first six months of 2002. Our net income for the first six months of 2002 would have been $10.4 million or $0.74 per diluted share if this valuation allowance release was excluded.
SIX MONTH PERIOD ENDED JUNE 30, 2002 ----------------------- (dollars in thousands, except per share data) Income before taxes .......................................................... $ 16,864 Income tax provision, excluding net release of tax valuation allowance ....... 6,479 -------- Net income, excluding net release of tax valuation allowance ................. $ 10,385 ======== Diluted earnings per share, excluding net release of tax valuation allowance . $ 0.74
RESULTS OF OPERATIONS -- COMPARING 2002 TO 2001 We reported net sales of $367.1 million in 2002, an increase of 20.6% from net sales of $304.3 million in 2001. From April 1, 2002 until December 31, 2002, our consumer solutions segment, which consists of the newly acquired Tilia business, generated net sales of $145.3 million. Our branded consumables segment reported net sales of $111.2 million in 2002 compared to $119.9 million in 2001. Net sales were $8.7 million or 7.3% lower than 2001, principally due to severe drought weather conditions S-21 during summer 2002 in the South, Southeast and West Central regions of the United States. Our plastic consumables segment reported net sales of $70.6 million in 2002 compared to $139.9 million in 2001. The principal cause of the $69.3 million decrease was the divestiture of the TPD Assets and Microlin, which accounted for $63.3 million of such change (after adjusting for $1.2 million of intercompany sales to these businesses). The remaining $6.0 million is principally due to lower tooling sales and a contractual sales price reduction to a significant customer. In the other segment, net sales decreased to $41.0 million in 2002 from $45.5 million in 2001, primarily due to reduced sales to the United States Mint in connection with its inventory reduction program for all coinage. We reported operating income of $65.1 million for 2002. These results compare to an operating loss of $113.9 million for 2001, which included special charges and reorganization expenses of $5.0 million and a loss on divestitures of assets and product lines of $122.9 million. All of our segments generated increases in operating income in 2002 from 2001, with the exception of the other segment, which had a small decrease but still maintained a constant operating income percentage of net sales in 2002. From April 1, 2002 until December 31, 2002, our consumer solutions segment, which consists of the newly acquired Tilia business, generated operating income of $31.7 million. Operating income for our branded consumables and plastic consumables segments increased by $4.7 million and $14.4 million, respectively, in 2002 compared to 2001. The other factors that contributed to these favorable operating income results are discussed in the following two paragraphs. Gross margin percentages on a consolidated basis increased to 41.0% in 2002 from 23.5% in 2001, reflecting the higher gross margins of the acquired home vacuum packaging business in 2002, the lower gross margins of the TPD Assets and Microlin businesses which were disposed in 2001, a $1.5 million charge for slow moving inventory in the branded consumables segment in 2001 and cost efficiency increases in our plastic consumables segment. These increases were partially offset by lower gross margins in the branded consumables segment caused by the lower sales volume. Selling, general and administrative expenses increased to $85.4 million in 2002 from $52.6 million in 2001, or, as a percentage of net sales increased to 23.3% in 2002 from 17.3% in 2001. This increase was principally due to the acquisition of the home vacuum packaging business, which accounted for an additional $46.3 million of selling, general and administrative expenses, and because of company-wide increased performance-based compensation expenses related to our strong financial performance in 2002. Partially offsetting this were decreases in selling, general and administrative expenses in our branded consumables, plastic consumables and other segments. Expenses within the branded consumables segment decreased due to lower selling expenses associated with the decrease in net sales discussed above. Expenses within our plastic consumables segment decreased primarily due to the divestiture of TPD Assets and Microlin, which accounted for $11.7 million of this decline, and lower expenses in the remaining business of the segment. We incurred net special charges and reorganization expenses of $5.0 million in 2001, consisting of $0.8 million in costs to exit facilities, $2.4 million in stock option compensation, $2.3 million in corporate restructuring costs, $2.6 million in separation costs for former executive officers and $1.4 million of costs to evaluate strategic options, partially offset by $4.1 million in pre-tax income related to the discharge of certain deferred compensation obligations and $0.4 million of income for items related to the divested TPD Assets. As a result of the adoption of SFAS No. 142, we did not record goodwill amortization in 2002. Goodwill amortization of approximately $5.2 million had been recorded in 2001. Net interest expense in 2002 was $12.6 million compared to $11.8 million for 2001, primarily due to the additional indebtedness assumed pursuant to the Tilia Acquisition, partially offset by the write-off in 2001 of $1.5 million of previously deferred debt issuance costs in November 2001 in conjunction with the amendment to our credit facility effected in connection with the TPD Assets sale. During 2002, we had a lower weighted average interest rate than the prior year, which was more than offset by higher average borrowings outstanding. Our effective tax rate was 30.8% in 2002 compared to 32.2% in 2001. At December 31, 2001, we had federal net operating losses that were recorded as a deferred tax asset with a valuation allowance of S-22 $5.4 million. Due to the impact of the Job Creation Act and the tax refunds that we received as a result, a net $4.4 million of this valuation allowance was released in 2002 resulting in an income tax provision of $16.2 million. Our net income for 2002 would have been $31.9 million or $2.22 diluted earnings per share if this valuation allowance release was excluded. Excluding the release of this valuation allowance, our effective tax rate was approximately 39.2% in 2002. The effective tax rate in 2001 was lower than the statutory federal rate due to the valuation allowance described above. RESULTS OF OPERATIONS -- COMPARING 2001 TO 2000 We reported consolidated net sales of $304.3 million in 2001, a decrease of 14.5% from net sales of $356.1 million in 2000. Net sales of the branded consumables segment were $119.9 million in 2001 compared to $119.1 million in 2000. Increased sales in the United States were offset by decreased sales in Canada due to unfavorable weather conditions and customers carrying higher levels of inventory over from 2000. Net sales within the plastic consumables segment were $139.9 million in 2001 compared to $179.3 million in 2000. The decrease of $39.4 million or 22.0% was due primarily to (i) lower demand for industrial thermoformed parts (part of the divested TPD Assets) in the heavy truck and material handling markets, and (ii) the fact that 2001 did not include December sales for the divested TPD Assets. Net sales of the other segment decreased to $45.5 million in 2001 from $58.8 million in 2000. This decrease of $13.3 million or 22.6% resulted from lower demand in all of our zinc product lines. Our operating loss for 2001 was $113.9 million, including special charges and reorganization expenses of $5.0 million and a total loss on divestitures of assets and product lines of $122.9 million. These results compare to operating income for 2000 of $19.0 million. The factors that contributed to these results are discussed in the following two paragraphs. Gross margin percentages increased to 23.5% in 2001 from 23.0% in 2000. Gross margin percentages increased for branded consumables due primarily to cost efficiencies which continued during 2001 as the benefits of the segment's SAP system implementation continued to be realized. The plastic consumables segment gross margin percentages declined from 16% in 2000 to 13% in 2001. This decrease in gross margin percentage was due primarily to (i) lower sales of plastic thermoformed parts (part of the divested TPD Assets) resulting in diminished operating efficiencies, and (ii) lower sales volumes causing fixed overhead costs to be allocated to less sales of injection molded plastic parts. There was an increase in the other segment's gross margin percentages from 28% in 2000 to 29% in 2001. Selling, general and administrative expenses decreased 6.2% to $52.6 million in 2001 from $56.1 million in 2000, or, as a percentage of sales increased to 17.3% in 2001 from 15.8% in 2000. Branded consumables expenses decreased primarily due to lower expenses associated with sales and marketing, warehousing and shipping. Expenses within the plastic consumables segment decreased primarily as a result of the cost savings realized due to a third quarter 2000 realignment and consolidation of our divested TPD Assets and the fact that 2001 did not include December expenses for the divested TPD Assets. Excluding the TPD Assets, selling, general and administrative expenses in the remainder of the plastic consumables segment and the other segment remained relatively constant. Goodwill amortization decreased from $6.4 million in 2000 to $5.2 million in 2001 due primarily to our November 2001 sale of the TPD Assets included in the plastic consumables segment. We incurred net special charges and reorganization expenses of $5.0 million in 2001, consisting of $0.8 million in costs to exit facilities, $2.4 million in stock option compensation, $2.3 million in corporate restructuring costs, $2.6 million in separation costs for former executive officers and $1.4 million of costs to evaluate strategic options, partially offset by $4.1 million in pre-tax income related to the discharge of certain deferred compensation obligations and $0.4 million of income for items related to the divested TPD Assets. Net interest expense in 2001 was $11.8 million compared to $11.9 million for 2000. The effects of lower average borrowings outstanding and lower interest rates during 2001 were offset by the write-off S-23 of $1.5 million of previously deferred debt issuance costs in November 2001 in conjunction with the amendment to our credit facility effected in connection with the sale of TPD Assets. Our effective interest rate for the year ended December 31, 2001 was 7.7%. As a result of decreasing interest rates during 2001, our interest rate swaps, which were at a fixed interest rate of 5.7%, resulted in additional interest expense to us during the year ended December 31, 2001. Our effective tax rate was 32.2% for 2001 compared to 34.0% for 2000. The effective rate for 2001 is lower than the statutory federal rate primarily because it includes a valuation allowance for tax benefits associated with the loss on the sale of the TPD Assets. The effective rate for 2000 reflects the recognition of a tax benefit from exiting the Central European home canning test market. FINANCIAL CONDITION, LIQUIDITY AND CAPITAL RESOURCES During the first six months of 2003, the following changes were made to our capital structure: o we issued $30 million of notes (the "New Notes") at a price of 106.5% of face value. Gross proceeds were approximately $32 million; o in conjunction with the timing of the issuance of the New Notes, we entered into a $30 million interest rate swap to receive a fixed rate of interest and pay a variable rate of interest based upon London Interbank Offered Rate ("LIBOR"); o we issued an aggregate of 200,000 restricted shares of common stock to certain officers; o approximately $4.9 million in loans to certain officers were repaid in full using shares of our common stock; o we entered into a $37 million interest rate swap to receive a floating rate of interest and pay a fixed rate of interest; o we received $3.2 million of cash proceeds, including $1 million of accrued interest, for unwinding our $75 million interest rate swap and contemporaneously replacing it with a new $75 million interest rate swap; o in connection with the Diamond Acquisition, we increased our term loan facility by $10 million and our revolving credit facility by $20 million; and o we repaid $10 million of seller debt financing. Specifically, on May 8, 2003, pursuant to an indenture dated January 29, 2003, as supplemented by a first supplemental indenture, dated May 8, 2003, we issued $30 million of New Notes under our shelf registration statement. The net proceeds of the offering were used to reduce the outstanding revolver balances under our senior credit facility. The New Notes were issued at a price of 106.5% of face value. The New Notes will mature on May 1, 2012, however, on or after May 1, 2007, we may redeem all or part of the New Notes at any time at a redemption price ranging from 100% to 104.875% of the principal amount, plus accrued and unpaid interest and liquidated damages, if any. Prior to May 1, 2005, we may redeem up to 35% of the aggregate principal amount of the New Notes with the net cash proceeds from certain public equity offerings at a redemption price of 109.75% of the principal amount, plus accrued and unpaid interest and liquidated damages, if any. Interest on the New Notes accrues at the rate of 9.75% per annum and is payable semi-annually in arrears on May 1 and November 1, commencing on November 1, 2003. On May 6, 2003, we entered into a $30 million interest rate swap ("New Swap") to receive a fixed rate of interest and pay a variable rate of interest based upon LIBOR. The New Swap is a swap against our 9 3/4% senior subordinated notes issued under an indenture dated April 24, 2002 ("Notes"). As disclosed in our 2003 Proxy Statement, our board of directors approved, on February 6, 2003, the granting of additional restricted shares of common stock to Messrs. Franklin and Ashken. Accordingly, during the second quarter of 2003, restricted shares of common stock in the aggregate amounts of 150,000 shares and 50,000 shares were issued to Martin E. Franklin, our Chairman and S-24 Chief Executive Officer, and Ian G.H. Ashken, our Vice Chairman, Chief Financial Officer and Secretary, respectively, under our 2003 Stock Incentive Plan. These shares were issued out of our treasury stock account. The restrictions on these shares shall lapse upon our common stock achieving a set price of $40, or on a change of control. During 2002, Messrs. Franklin and Ashken exercised 600,000 and 300,000 non-qualified stock options, respectively, which had been granted under our 2001 Stock Option Plan. These shares were issued out of our treasury stock account. The exercises were accomplished via loans from us under our Executive Loan Program. The principal amounts of the loans were $3.3 million and $1.6 million, respectively, and bore interest at 4.125% per annum. The loans were due on January 23, 2007 and were classified within the stockholders' equity section. The loans could be repaid in cash, shares of our common stock, or a combination thereof. In February 2003, Mr. Ashken surrendered to us shares of our common stock to repay $0.3 million of his loan. On April 29, 2003, Messrs. Franklin and Ashken each surrendered to us shares of our common stock to repay in full all remaining principal amounts and accrued interest owed under their respective loans. We will not make any additional loans under the Executive Loan Program. Effective April 2, 2003, we entered into an interest rate swap that converted $37 million of floating rate interest payments under our term loan facility for a fixed obligation that carries an interest rate, including applicable margin, of 4% per annum. The swap has interest payment dates that are the same as the term loan facility and it matures on September 30, 2004. The swap is considered to be a cash flow hedge and is also considered to be an effective hedge against changes in the fair value of our floating-rate debt obligation for both tax and accounting purposes. Gains and losses related to the effective portion of the interest rate swap are reported as a component of other comprehensive income and will be reclassified into earnings in the same period that the hedged transaction affects earnings. In March 2003, we unwound a $75 million interest rate swap to receive a fixed rate of interest and pay a variable rate of interest based upon LIBOR and contemporaneously entered into a new $75 million interest rate swap ("Replacement Swap"). Like the swap that it replaced, the Replacement Swap is a swap against our Notes. The Replacement Swap has a maturity date that is the same as the Notes. Interest is payable semi-annually in arrears on May 1 and November 1. We accrue interest on the swap at an effective rate of 7.03%. In return for unwinding the swap, we received $3.2 million of cash proceeds. Of this amount, approximately $1 million of such proceeds related to accrued interest that was owed to us at such time. The remaining $2.2 million of proceeds is being amortized over the remaining life of the Notes as a credit to interest expense and the unamortized balances are included in our Consolidated Balance Sheet as an increase to the value of the long-term debt. Pursuant to the Diamond Acquisition, in February 2003, we amended our senior secured credit facility ("Credit Agreement") increasing our term loan facility by $10 million and our revolving loan facility by $20 million. We repaid seller debt financing, incurred in connection with the Tilia Acquisition, in the principal amount of $10 million on March 31, 2003. In January 2003, we filed a shelf registration statement, which was declared effective by the Securities and Exchange Commission on January 31, 2003. This shelf registration statement is intended to facilitate our access to growth capital for future acquisitions and allows us to sell over time up to $150 million of common stock, preferred stock, warrants, debt securities, or any combination of these securities in one or more separate offerings in amounts, at prices and on terms to be determined at the time of the sale. The $30 million of New Notes issued in May 2003 were issued under our shelf registration statement, leaving $120 million available under this registration statement. As of June 30, 2003, we had $54.5 million outstanding under the term loan facility of the Credit Agreement and $6.3 million outstanding under the revolving credit facility of the Credit Agreement. Net availability under the revolving credit agreement was approximately $50.9 million as of June 30, 2003, after deducting $12.8 million of issued letters of credit. We are required to pay commitment fees on the unused balance of the revolving credit facility. S-25 As of June 30, 2003, our long-term debt included approximately $8.4 million of non-debt balances arising from interest rate swap transactions that we had entered into. Working capital decreased to approximately $71.5 million at June 30, 2003 from approximately $101.6 million at December 31, 2002 due primarily to the use of cash on hand and draw downs under our Credit Agreement to finance our acquisitions. This was partially offset by the working capital from the acquisitions. Cash flow from operations in the first six months of 2002 included $38.5 million in tax refunds. Excluding the effect of tax refunds, we generated cash flow from operations of $14.8 million in the first six months of 2003, compared to $8.7 million in the first six months of 2002. Capital expenditures were $4.6 million in the first six months of 2003 compared to $3.1 million for the first six months of 2002 and are largely related to maintaining facilities, tooling projects, improving manufacturing efficiencies, new information systems and a portion of the costs of the installation of new packaging lines for the branded consumables segment. As of June 30, 2003, we have capital expenditure commitments in the aggregate for all of our segments of approximately $7.2 million, of which $1.9 million relates to the completion of the new packaging lines for the branded consumables segment and $3.0 million relates to the installation of a new management information system for the consumer solutions segment. Additionally, as of June 30, 2003, our other segment had forward buy contracts for the remainder of 2003 to purchase zinc ingots in the aggregate amount of approximately $1.8 million, which are expected to be used in operations in 2003. We believe that cash generated from our operations and our availability under our Credit Agreement are adequate to satisfy our working capital and capital expenditure requirements for the foreseeable future. However, we may raise additional capital from time to time to take advantage of favorable conditions in the capital markets or in connection with our corporate development activities. S-26 UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS The following unaudited pro forma financial information as of and for the year ended December 31, 2002 has been derived from our audited consolidated financial statements as of and for such period. The following unaudited pro forma financial information as of and for the six months ended June 30, 2003 has been derived from our unaudited interim consolidated financial statements as of and for such period. The unaudited pro forma condensed consolidated financial statements give effect to (collectively, the "Transactions"): i. the April 2002 acquisition (the "Tilia Acquisition") of substantially all of the assets of Tilia International, Inc. and its subsidiaries ("Tilia") including the related refinancing of our senior credit facility and the offering of 9 3/4% senior subordinated notes; ii. the February 2003 acquisition (the "Diamond Acquisition") of substantially all of the assets of Diamond Brands International, Inc. and its subsidiaries ("Diamond") including the related financing; and iii. the September 2003 acquisition (the "Lehigh Acquisition") of Lehigh Consumer Products Corporation and its subsidiary ("Lehigh") including the related amendment and restatement of our senior credit facility and issuance of an additional $150 million of term debt thereunder. The unaudited pro forma financial information is not necessarily indicative of our results of operations or financial position had the events reflected herein actually been consummated at the assumed dates, nor is it necessarily indicative of our results of operations or financial position for any future period. The unaudited pro forma financial information should be read in conjunction with the Jarden consolidated financial statements with the related notes incorporated by reference herein and the Lehigh and Diamond consolidated financial statements with the related notes incorporated by reference herein. The pro forma adjustments related to the purchase price allocation of the Lehigh and Diamond Acquisitions are preliminary and are subject to revision as additional information becomes available. Revisions to the preliminary purchase price allocation of the Lehigh and Diamond Acquisitions may have a significant impact on the unaudited pro forma information. S-27 UNAUDITED PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET AS OF JUNE 30, 2003
LEHIGH ACQUISITION JARDEN PRO FORMA PRO FORMA AS REPORTED LEHIGH ADJUSTMENTS COMBINED ------------- ---------- ------------- ---------- (dollars in thousands) ASSETS Current assets Cash and cash equivalents ................. $ 4,704 $ 130 $ 4,834 Accounts receivable, net .................. 56,136 30,570 $ (246)A 86,460 Inventories, net .......................... 82,666 14,494 97,160 Deferred taxes on income .................. 11,055 11,055 Other current assets ...................... 6,009 1,058 7,067 -------- ------- -------- -------- Total current assets .................... 160,570 46,252 (246) 206,576 Property, plant and equipment, net ......... 71,353 13,439 (6,702)B 84,090 6,000 C Intangibles, net ........................... 192,962 39,580 68,020 D 300,562 Other assets ............................... 15,861 402 3,500 E 19,763 -------- ------- ---------- -------- Total assets ............................... $440,746 $99,673 $ 70,572 $610,991 ======== ======= ========== ======== LIABILITIES AND EQUITY Current liabilities Short-term debt and current portion of long-term debt .......................... $ 20,673 $ 3,557 $ (3,557)F $ 32,173 10,000 G 1,500 G Accounts payable .......................... 26,119 3,395 29,514 Other current liabilities ................. 42,296 14,978 (8,128)H 49,146 -------- ------- ---------- -------- Total current liabilities ............... 89,088 21,930 (185) 110,833 -------- ------- ---------- -------- Noncurrent liabilities ..................... Long-term debt ............................ 233,613 17,138 (17,138)F 382,113 148,500 G Deferred taxes on income .................. 7,617 7,617 Other noncurrent liabilities .............. 14,044 1,457 (1,457)I 14,044 -------- ------- ---------- -------- Total noncurrent liabilities 255,274 18,595 129,905 403,774 Equity ..................................... 96,384 59,148 (59,148)J 96,384 -------- ------- ---------- -------- Total liabilities and equity ............... $440,746 $99,673 $ 70,572 $610,991 ======== ======= ========== ========
S-28 UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS FOR THE SIX MONTHS ENDED JUNE 30, 2003
DIAMOND LEHIGH ACQUISITION SUB-TOTAL ACQUISITION JARDEN PRO FORMA PRO FORMA PRO FORMA PRO FORMA AS REPORTED DIAMOND(1) ADJUSTMENTS COMBINED LEHIGH ADJUSTMENTS COMBINED ------------- ------------ ------------- ------------- ---------- ------------- ------------- (dollars in thousands, except per share data) Net sales ............... $ 228,114 $ 6,814 $ 234,928 $67,655 $ 302,583 Costs and expenses: Cost of sales ........... 140,264 4,649 $119K 145,032 47,462 $ 429P 192,923 Selling, general and administrative expenses ............... 56,306 884 57,190 9,025 489 Q 65,158 (96)R (250)S (1,200)T Reorganization costs (2) .............. 1,536 1,536 1,536 --------- --------- ---- --------- ------- -------- --------- Operating income (loss) ................. 31,544 (255) (119) 31,170 11,168 628 42,966 Interest expense (income), net .......... 8,219 921 (921)L 8,423 734 3,395 U 12,168 155 M (734)W 49 N 350 X --------- --------- ---------- --------- ------- ---------- --------- Income (loss) before taxes .................. 23,325 (1,176) 598 22,747 10,434 (2,383) 30,798 Income tax provision (benefit) .............. 9,144 (227)O 8,917 (129) 3,285 O 12,073 --------- --------- ------ --------- ------- ---------- --------- Net income (loss) ....... $ 14,181 $ (1,176) $ 825 $ 13,830 $10,563 $ (5,668) $ 18,725 ========= ========= ====== ========= ======= ======== ========= Basic earnings per share .................. $ 1.00 $ 0.97 $ 1.31 Diluted earnings per share .................. $ 0.96 $ 0.94 $ 1.27 Weighted average shares outstanding: Basic ................... 14,242 14,242 14,242 Diluted ................. 14,727 14,727 14,727 Other data: Depreciation and amortization ........... $ 7,230 $ 83 $119K $ 7,432 $ 975 $ 429P $ 8,740 (96)R
- ---------- (1) The results for Diamond represent Diamond's unaudited actual results for the month ended January 31, 2003, which are not included in Jarden's results. (2) On May 22, 2001, Diamond filed voluntary petitions for reorganization under Chapter 11 of the United States Bankruptcy Code. Accordingly, its expenses related to the bankruptcy are included in "Reorganization Costs." S-29 UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS FOR THE YEAR ENDED DECEMBER 31, 2002
TILIA AND DIAMOND LEHIGH ACQUISITION SUBTOTAL ACQUISITION JARDEN PRO FORMA PRO FORMA PRO FORMA AS REPORTED TILIA (1) DIAMOND ADJUSTMENTS COMBINED LEHIGH ADJUSTMENTS ------------- ----------- ----------- ------------- ------------- ----------- ------------- (dollars in thousands, except per share data) Net sales ..................... $ 367,104 $38,525 $101,604 $ 507,233 $128,128 Costs and expenses: Cost of sales ................. 216,629 19,343 72,163 $1,429K 309,564 89,704 $ 857P Selling, general and administrative expenses....... 85,366 13,468 10,033 172 Y 109,039 19,532 978 Q (500)S (198)R (3,337)T 380 U Reorganization costs (2) ...... 4,565 4,565 --------- ------- -------- -------- --------- -------- -------- Operating income (loss) ....................... 65,109 5,714 14,843 (1,601) 84,065 18,892 1,820 Other expense ................. 380 (380)U Interest expense, net ......... 12,611 (52) 9,182 (1,232)Z 17,895 1,874 7,738 V (9,182)L 4,344 AA (1,874)W 1,525 M 474 N 225 BB 700 X --------- ------- -------- ---------- --------- -------- ---------- Income (loss) before taxes..... 52,498 5,766 5,661 2,245 66,170 16,638 (4,364) Income tax provision (3) ...... 16,189 1,801 3,558 O 21,548 4,811 O --------- ------- -------- ---------- --------- -------- ---------- Net income (loss) ............. $ 36,309 $ 3,965 $ 5,661 $(1,313) $ 44,622 $ 16,638 $(9,175) ========= ======= ======== ======== ========= ======== ======== Basic earnings per share ...... $ 2.60 $ 3.20 Diluted earnings per share .................... $ 2.52 $ 3.10 Weighted average shares outstanding: Basic ......................... 13,940 13,940 Diluted ....................... 14,392 14,392 Other data: Depreciation and amortization ................. $ 10,001 $ 471 $ 2,321 $ 172Y $ 14,394 $ 2,164 $ 857P 1,429 K (198)R PRO FORMA COMBINED ------------- Net sales ..................... $ 635,361 Costs and expenses: Cost of sales ................. 400,125 Selling, general and administrative expenses....... 125,894 Reorganization costs (2) ...... 4,565 --------- Operating income (loss) ....................... 104,777 Other expense ................. Interest expense, net ......... 26,333 --------- Income (loss) before taxes..... 78,444 Income tax provision (3) ...... 26,359 --------- Net income (loss) ............. $ 52,085 ========= Basic earnings per share ...... $ 3.74 Diluted earnings per share .................... $ 3.62 Weighted average shares outstanding: Basic ......................... 13,940 Diluted ....................... 14,392 Other data: Depreciation and amortization ................. $ 17,217
- ---------- (1) Amounts in the Tilia column represent Tilia's actual results for the three months ended March 31, 2002, which are not included in Jarden's reported results. (2) On May 22, 2001, Diamond filed voluntary petitions for reorganization under Chapter 11 of the United States Bankruptcy Code. Accordingly, its expenses related to the bankruptcy are included in "Reorganization Costs." (3) The income tax provision of Jarden for the year ended December 31, 2002 includes a net release of a $4.4 million tax valuation allowance. The actual effective tax rate for the year (excluding the net release) was 39.2%. S-30 NOTES TO UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (dollars in thousands) Balance sheet adjustments: (a) Adjustment to reflect the elimination of a receivable from Lehigh's parent company not purchased in the Lehigh Acquisition. (b) Adjustment to reflect the elimination of the net book value of Lehigh's Macungie, Pennsylvania land and building not purchased in the Lehigh Acquisition. Pursuant to the terms of the Lehigh Acquisition, Lehigh entered into a ten (10) year lease with the Seller for the property. See Note (q). (c) Adjustment to reflect the estimated step-up in fair value of Lehigh's manufacturing related machinery and equipment. (d) Adjustment to reflect the estimated step-up in fair value of intangible assets (trademarks and goodwill) to be recorded with the Lehigh acquisition. (e) Adjustment to capitalize the debt issuance costs associated with the new senior term debt issued to fund the cash purchase price of the Lehigh Acquisition. The costs will be amortized over the term of the debt (5 years). (f) Adjustment to reflect the elimination of debt which Jarden is not assuming in the Lehigh Acquisition. (g) Adjustment to reflect borrowings on Jarden's senior credit facility used to fund the Lehigh Acquisition ($10,000 of Revolving Credit Facility, $1,500 of short-term portion of Term Loan B and $148,500 of long-term portion of Term Loan B). (h) Adjustment to reflect the elimination of the stockholder appreciation rights plan liability which Jarden is not assuming in the Lehigh Acquisition. (i) Adjustment to reflect the elimination of the interest rate swap liability which Jarden is not assuming in the Lehigh Acquisition. (j) Adjustment to reflect the elimination of the existing stockholders' equity of Lehigh. Statements of operations adjustments: (k) Adjustment to reflect depreciation expense on the estimated step up in valuation of Diamond's manufacturing related machinery and equipment amortized over an estimated useful life of seven (7) years. (l) Adjustment to reflect the elimination of Diamond's historical interest expense. (m) Adjustment to reflect interest expense on the drawdown of Jarden's revolving credit facility and the issuance of term debt in order to fund a portion of the cash purchase price of the Diamond Acquisition based upon Jarden's effective borrowing rate on its senior credit facility. The effect of a 1/8% change in interest rates would be $35 per year. (n) Adjustment to reflect the elimination of Jarden's interest income related to cash on hand used to fund a portion of the cash purchase price of the Diamond Acquisition. (o) Adjustment to reflect an effective tax rate of 39.2% on the pre-tax results of the acquired business and related adjustments based on Jarden's effective tax rate for the period. (p) Adjustment to reflect the depreciation expense on the estimated step up in valuation of Lehigh's manufacturing related machinery and equipment amortized over an estimated useful life of seven (7) years. See note (c). S-31 (q) Adjustment to reflect rental expense for the Macungie, Pennsylvania property not purchased with the Lehigh acquisition, but leased from the seller by Jarden in conjunction with the Lehigh Acquisition. See note (b). (r) Adjustment to reflect the elimination of historical depreciation of the building not purchased in the Lehigh Acquisition. See note (b). (s) Adjustment to reflect the elimination of Lehigh's historical management fee expense charged from its former parent. The management fee contract was terminated in conjunction with the Lehigh Acquisition. (t) Adjustment to reflect the elimination of the historical stockholders' appreciation rights plan expense. See note (h). (u) Adjustment to reflect the reclassification of Lehigh's other expense to selling, general and administrative expenses to conform to Jarden's presentation. (v) Adjustment to reflect pro forma interest expense relating to: i. the $10 million borrowing under Jarden's revolving credit facility to partially fund the purchase price of the Lehigh acquisition, based upon Jarden's effective borrowing rate for its senior credit facility. ii. the $150 million term loan issued to fund the purchase price of the Lehigh Acquisition, based upon Jarden's effective borrowing rate for its senior credit facility. The effect of a 1/8% change in interest rates would be $200 per year (w) Adjustment to reflect the elimination of Lehigh's historical interest expense. (x) Adjustment to reflect amortization of debt issue costs for new senior term loan issued in conjunction with the Lehigh Acquisition. (y) Adjustment to reflect amortization of identifiable intangible assets recorded with the Tilia acquisition. (z) Adjustment to reflect the elimination of Jarden's historical interest expense prior to the Tilia acquisition for the first quarter of 2002. (aa) Adjustment to reflect pro forma interest expense relating to: i. the new senior credit facility issued in conjunction with the Tilia Acquisition at 5%, based upon Jarden's effective borrowing rate on its senior credit facilities for first quarter 2002; ii. the interest bearing subordinated seller note issued in conjunction with the Tilia Acquisition at 5% based upon Jarden's effective borrowing rate on its senior credit facilities for first quarter 2002; and iii. the 9 3/4% Senior Subordinated Notes due 2012 issued in conjunction with the Tilia Acquisition. (bb) Adjustment to reflect the amortization of debt issue costs for both the new senior credit facility and the Senior Subordinated Notes due 2012 issued in conjunction with the Tilia Acquisition. S-32 BUSINESS OUR COMPANY We are a leading provider of niche consumer products used in and around the home, under well-known brand names including Ball (Registered Trademark) , Bernardin (Registered Trademark) , Crawford (Registered Trademark) , Diamond (Registered Trademark) , FoodSaver (Registered Trademark) , Forster (Registered Trademark) , Kerr (Registered Trademark) , Lehigh (Registered Trademark) and Leslie-Locke (Registered Trademark) . In North America, we are the market leader in several targeted categories, including branded retail plastic cutlery, home canning, home vacuum packaging, kitchen matches, rope, cord and twine and toothpicks. Many of our products are affordable, consumable and fundamental household staples, resulting in recurring revenues. Our highly recognized brands, innovative products and multi-channel distribution strategy, together with our strategic acquisitions, have resulted in significant growth in revenue and profitability. In the year ended December 31, 2002, we generated $635.4 million, $104.8 million and $52.1 million in net sales, operating income and net income, respectively on a pro forma basis, after taking into effect our acquisitions of Tilia, Diamond and Lehigh as though they were effective as of January 1, 2002. We have achieved leading market positions by selling branded consumer products through a variety of distribution channels, including club, department store, drug, grocery, hardware, home improvement, mass merchant and specialty retailers, as well as direct to consumers. By leveraging our strong brand portfolio, category management expertise and superior customer service, we have established and continue to maintain long-term relationships with leading retailers within these channels. We have long-standing relationships with each of our top ten customers. For example, we have serviced Wal-Mart and Home Depot since their openings in 1962 and 1978, respectively, and are currently category manager at Wal-Mart for home canning-related products and at Home Depot for cordage. Moreover, several of our leading brands, such as Diamond (Registered Trademark) kitchen matches and Ball (Registered Trademark) jars, have been in continuous use for over 100 years. We continue to expand our existing customer relationships and attract customers by introducing new product line extensions and entering new product categories. We operate three primary business segments, comprised of branded consumables, consumer solutions and plastic consumables. Branded Consumables. We manufacture or source, market and distribute a broad line of branded consumer products that includes craft items, food preparation kits, home canning jars, jar closures, kitchen matches, plastic cutlery, rope, cord and twine, storage and workshop accessories, toothpicks and other accessories marketed under the Ball (Registered Trademark) , Bernardin (Registered Trademark) Crawford (Registered Trademark) , Diamond (Registered Trademark) , Forster (Registered Trademark) , Kerr (Registered Trademark) , Lehigh (Registered Trademark) and Leslie-Locke (Registered Trademark) brand names. We deliver our branded consumable products to over 3,100 customers nationwide. On September 2, 2003, we acquired all of the issued and outstanding stock of Lehigh Consumer Products Corporation ("Lehigh"), the largest supplier of rope, cord and twine for the U.S. consumer marketplace and a leader in innovative storage and organization products for the home and garage as well as products in the security door and fencing market. Consumer Solutions. We source, market and distribute an array of home vacuum packaging machines under the market leading FoodSaver (Registered Trademark) brand name, as well as other products that service the needs of the consumer in the kitchen. We believe that the FoodSaver (Registered Trademark) vacuum packaging system is superior to more conventional means of food packaging, including freezer and storage bags and plastic containers, in preventing dehydration, rancidity, mold, freezer burn and hardening of food. The original FoodSaver (Registered Trademark) product was successfully launched through infomercials and has since expanded its distribution channels to be based primarily on retail customers. In addition to machines, we market and distribute an expanding line of proprietary bags and bag rolls for use with FoodSaver (Registered Trademark) machines, which represents a recurring revenue source, along with accessories including canisters, jar sealers and wine stoppers. Plastic Consumables. We manufacture, market and distribute a wide variety of consumer and medical plastic products for customers and our other primary segments. These products include closures, contact lens packaging, plastic cutlery, refrigerator door liners, shotgun shell casings, surgical devices and syringes. Many of these products are consumable in nature or represent components of consumer products. S-33 In addition to the three primary business segments described above, our other business consists primarily of our zinc strip business, which is the largest producer of zinc strip and fabricated products in the United States. COMPETITIVE STRENGTHS We believe that the following competitive strengths serve as a foundation for our growth strategy: Market Leadership Positions. In North America, we are a leader in several targeted categories including, among others, branded retail plastic cutlery, home canning, home vacuum packaging, kitchen matches, rope, cord and twine and toothpicks. We believe that the specialized nature of our niche categories and our leading market shares therein provide us with competitive advantages in terms of demand from major retailers and enhanced brand awareness. We created the home vacuum packaging category at most of our retailers and actively work with them to promote the FoodSaver (Registered Trademark) brand and home vacuum packaging to consumers. In addition, our branded consumables business is either the named category manager, sole supplier or one of a select few vendors to the dominant retailers in many of its product lines. Strong Brand Name Recognition. We have built a portfolio of leading consumer brands, which assists us in gaining retail shelf space and introducing new products. The Ball (Registered Trademark) brand has been in continuous use for over 100 years and is internationally recognized within the home food preservation market. In the United States, we believe Kerr (Registered Trademark) is also a widely-recognized home canning brand while Bernardin (Registered Trademark) is the leading home canning brand in Canada. We believe Diamond (Registered Trademark) , Forster (Registered Trademark) and FoodSaver (Registered Trademark) are the leading brands in their principal markets and are well recognized by consumers. We believe our strong brand recognition and consumer awareness, coupled with the long-standing quality of our products, results in significant customer loyalty. Comprehensive Product Offering. We provide retailers a comprehensive portfolio of niche consumer products across multiple categories, which adds diversity to our revenue and cash flows. Within these categories, we service the needs of a wide range of consumers and satisfy their different tastes, preferences and budgets. In home canning, we offer a range of branded products to serve the value, mid-tier and premium price points, selling more than 300 stock keeping units. We offer kitchen matches, plastic cutlery and toothpicks of various counts, sizes and durability. FoodSaver's (Registered Trademark) current offerings are well positioned to take advantage of a "good, better, best" strategy in order to target consumers with various levels of price sensitivity and product sophistication. We also offer rope, cord and twine products, storage and workshop accessories and metal security doors and fencing covering more than 1,500 stock keeping units. We believe our ability to serve retailers with a broad array of branded products and introduce new products will continue to allow us to penetrate existing customers. Long-Term Customer Relationships. We have established and continue to maintain strong relationships with our retail customers based, in part, on our portfolio of leading brands, superior customer service and product innovation. We are the named category manager for various products at key retailers, including Wal-Mart, Home Depot and Lowe's, and are the leading supplier for other products for which there is no named category manager. In addition, we have maintained relationships for more than 10 years with virtually all of our key customers. We provide marketing, technical and service support to our retail customers by assisting with category management, in-store merchandising and customized packaging. We also offer end users a broad array of services including product warranties, toll-free customer service numbers and web sites featuring extensive customer service information. Expertise in Successfully Identifying and Executing Complementary Acquisitions. We believe we have expertise in identifying and acquiring businesses or brands that complement our existing product portfolio. We utilize a systematic, disciplined acquisition strategy to identify candidates that can provide category leading product offerings to be sold through our existing distribution channels or new distribution channels for our existing products. This expertise has resulted in several important recent strategic acquisitions of complementary businesses and brands such as Tilia, Diamond, and Lehigh, which have helped build our portfolio of niche consumer products used in and around the S-34 home and strengthened our distribution channels. Moreover, we have developed an operating infrastructure with the proven capability to successfully integrate acquisitions. We believe that our acquisition expertise uniquely positions us to take advantage of future opportunities to acquire complementary businesses or brands. Recurring Revenue Stream. We derive recurring and, we believe, annually stable sales from many of our leading products due to their affordability and position as fundamental staples within many households. Our jar closures, kitchen matches, plastic cutlery, rope, cord and twine and toothpicks exemplify these traits. Moreover, we believe that as the installed base of FoodSaver (Registered Trademark) appliances increases, our patented disposable storage bags and related accessories used with the FoodSaver (Registered Trademark) appliances will constitute an increasing percentage of revenues. In 2000, revenues from the sale of storage bags generated 18% of our consumer solutions segment net sales compared to approximately 27% for 2002. Low Cost Manufacturing. We believe we excel at manufacturing programs involving high volumes with superior efficiencies, low cost and exceptional quality. We have organized the production runs of our branded consumable product lines to minimize the number of manufacturing functions and the frequency of material handling. We also utilize, where practical, a flexible process which uses cellular manufacturing to allow a continuous flow of parts with minimal set up time. Our efficient and automated plastic cutlery manufacturing operations enable us to produce, count and package plastic cutlery ready for retail distribution with minimal labor costs. We also utilize an efficient outsourced manufacturing network of suppliers for certain of our branded consumables and consumer solutions products. Many of these relationships are long-term, affording us increased flexibility and stability in our operations. Appliances, bags and accessories are sourced from several facilities throughout Asia and the United States. This diverse network allows us to maintain multiple sources of quality products while keeping price points competitive and provides us with quick response, special order service, and low-cost, high-volume production capacity. We believe our service levels, including fill rates, are attractive as compared to our competitors. Proprietary and Patented Technology. We believe we have proprietary expertise in the design, development and manufacture of certain of our products supported by patented technology, affording us a competitive advantage and enabling us to maintain our market leading positions. We maintain patents on our FoodSaver (Registered Trademark) home vacuum packaging systems and on the bags used for vacuum sealing. This patent protection and our well-developed manufacturing relationships have enabled us to become the market leader within the home vacuum packaging category. For our home canning products, we have developed a proprietary two-piece closure system incorporating a plastisol sealant that differentiates our jar lids from those of competitors. We also have several innovative new products in development for which patents are pending, including the next generation of home vacuum packaging bags and systems. Proven and Incentivized Management Team. Our management team has a proven track record of successful management with positive operating and shareholder results. Our management team is led by Martin E. Franklin, our Chairman and Chief Executive Officer, and Ian G.H. Ashken, our Vice Chairman and Chief Financial Officer, both of whom joined Jarden in 2001 and who collectively beneficially own approximately 7% of our common stock. We have also recently hired James E. Lillie to the newly created position of Chief Operating Officer to oversee day-to-day operations and operational integration. Each of our operating businesses is managed by professionals with an average of over 20 years of experience. Senior operating managers also participate in our equity incentive programs, and cash incentive compensation is primarily based on attaining selected financial performance targets. GROWTH STRATEGY Our objective is to increase revenue, cash flow and profitability while increasing our position as a leading manufacturer, marketer and distributor of niche, branded consumer products. Our strategy for achieving these objectives includes the following key elements: Further Penetrate Existing Distribution Channels. We will seek to further penetrate existing distribution channels to drive organic growth by capitalizing on our strong existing customer S-35 relationships and attracting new customers. We intend to further penetrate existing customers by continuing to (i) provide quality products, (ii) efficiently and consistently fulfill logistical requirements and volume demands, (iii) provide comprehensive product support from design to after-market customer service and (iv) cross-sell our branded consumables and consumer solutions products and accessories to our extensive combined customer base. As a result of our 2002 cross-selling initiatives, FoodSaver (Registered Trademark) products are now being sold through the grocery and hardware channels, where we previously sold primarily branded consumable products. Similarly, we believe there is potential to introduce our home canning products into leading home improvement retailers as a result of the Lehigh acquisition. We intend to attract new customers through our portfolio of leading brands, innovative products and superior customer service. Introduce New Products. To drive organic growth from our existing businesses, we intend to continue to leverage our strong brand names, customer relationships and proven capacity for innovation to expand product offerings in each of our major product categories. For example, our branded consumables business is targeting several new product introductions, with a recent focus on all-in-one Ball (Registered Trademark) home canning-related kits that provide consumers a simpler and more convenient experience. In 2002, we successfully introduced jelly and salsa kits and have introduced several additional kits in 2003. Other product line extensions in branded consumables include innovative packaging solutions that meet specific consumer needs and drive profitability such as the recently introduced Shake-A-Pick (Registered Trademark) , an individual toothpick dispenser. In addition, we have historically been able to cycle out old home improvement products and replace them with newer versions, enabling us to avoid price reductions and maintain attractive margins. Such changes include packaging and coloration modifications and redesigning products to improve functionality for garage storage solutions. Pursue Strategic Acquisitions. We anticipate that the fragmented nature of the niche consumer products market will continue to provide significant opportunities for growth through strategic acquisitions of complementary businesses. Our acquisition strategy will continue to focus on businesses or brands with product offerings that provide expansion into related categories and can be marketed through our existing distribution channels or provide us with new distribution channels for our existing products, thereby increasing marketing and distribution efficiencies. Furthermore, we seek acquisition candidates with attractive margins, strong cash flow characteristics, category leading positions and products that generate recurring revenue. Our acquisitions of Tilia, Diamond and Lehigh are examples of our ability to implement this acquisition strategy. We anticipate that future acquisitions will be financed through a combination of operating cash flow, debt and equity, including the proceeds of this offering. We are continuing pursuing several tuck-in acquisitions, all of which, if consummated, would have an aggregate purchase price of approximately $40 million. No assurances can be given that any such potential acquisition will be consummated or, if any such acquisition is consummated, as to the terms of such acquisition, including price. Expand Internationally. Historically, we have focused primarily on North American sales while establishing a limited sales presence internationally. In 2002, sales outside of North America represented less than 2% of sales. We intend to expand our international sales primarily by developing distribution channels for certain of our existing products and by pursuing strategic acquisitions of foreign businesses with established complementary distribution channels. We are in the early stages of implementing our proven North American home vacuum packaging product introduction strategy in Asia and Europe, where we have recently entered into limited distribution agreements for our FoodSaver (Registered Trademark) products. In these markets, we intend to follow the successful strategy we implemented in North America by initially utilizing direct to consumer sales, including infomercials, to build consumer awareness and generate retail demand. Once a critical mass of consumer sales and interest has been established, we intend to launch FoodSaver (Registered Trademark) products through traditional retail channels. THE LEHIGH ACQUISITION On September 2, 2003, we acquired Lehigh, the largest supplier of rope, cord and twine for the U.S. consumer marketplace and a leader in innovative storage and organization products for the home and garage as well as products in the security door and fencing market. Its customers include North S-36 America's largest and rapidly growing warehouse home centers and mass merchants. For the year ended December 31, 2002, Lehigh had revenue and operating income of $128.1 million and $18.9 million, respectively. We acquired Lehigh for cash consideration of $155 million (excluding transaction costs) at closing (the "Lehigh Acquisition"). In addition, the Lehigh Acquisition includes an earn-out provision with a potential payment in cash or our registered common stock of up to $25 million payable in 2006, provided that certain earnings performance targets are met. If paid, we expect to capitalize the cost of the earn-out. Strategically, Lehigh complements our existing consumer products businesses. The acquisition is consistent with our strategy of acquiring branded consumer products businesses with leading market positions in niche markets for products used in and around the home, attractive operating margins and strong management. The Lehigh acquisition (i) is expected to be accretive to earnings per share, (ii) provides cross-selling opportunities to our established retail customer base, (iii) adds complementary distribution channels to our strong domestic distribution network and (iv) has the potential to create cost synergies. BRANDED CONSUMABLES On February 7, 2003, we acquired substantially all of the assets of Diamond and on September 2, 2003 we acquired Lehigh. The discussion below incorporates these acquired businesses. We manufacture, market and distribute a broad line of branded products that includes craft items, food preparation kits, home canning jars, jar closures, kitchen matches, plastic cutlery, rope, cord and twine, storage and workshop accessories, toothpicks and other accessories. We distribute our branded consumable products through approximately 3,100 customers. We sell a variety of branded consumable products detailed in the chart below: Selected Owned and Licensed Brands Selected Products - ---------------------------------------------------------------------------------- ------------------------------------------ Ball (Registered Trademark) , Bernardin (Registered Trademark) Home canning jars in various sizes, and Kerr (Registered Trademark) consumable decorative and functional lids, food preparation kits, home canning accessories Diamond (Registered Trademark) and Forster (Registered Trademark) Kitchen matches, plastic cutlery, toothpicks, clothespins, wood craft items, fire starters, book matches, straws Lehigh (Registered Trademark) and Crawford (Registered Trademark) Ropes in synthetic and natural fiber, clotheslines and related hardware, twines, rubber tie downs Storehorse (Registered Trademark) and Crawford (Registered Trademark) Metal and plastic sawhorses, power tool stands, multi-purpose workbenches, garage storage organizers, tool racks, brackets, pegboard hooks Leslie-Locke (Registered Trademark) Security screen doors, security door line extensions, tubular steel window guards, ornamental fencing, panels with posts, gates
Customers We have long-standing relationships with a diverse group of retail, wholesale and institutional customers in North America. We sell through a wide variety of retail formats, including grocery stores, mass merchants, department stores, value retailers, home improvement stores and craft stores. Our principal branded consumable customers include Albertson's, Dollar General, Home Depot, Kroger, Lowe's and Wal-Mart, among others. S-37 Sales and Marketing Our branded consumables sales efforts are led by our internal sales force, who manage house accounts and oversee food brokerage firms and independent manufacturer representatives. Regional sales managers are organized by geographic area and are responsible for customer relations management, pricing and distribution strategies, and sales generation. Our marketing and sales departments work closely together to develop these pricing and distribution strategies and to design packaging and develop product line extensions and new products. Some of our marketing initiatives include in-store coupons, strategically located display cases and the new "ultimate package" for home canning jars. We have employed a two-tier marketing strategy for our line of home canning and plastic cutlery products. The Ball (Registered Trademark) , Kerr (Registered Trademark) , Diamond (Registered Trademark) and Forster (Registered Trademark) brand names are marketed as premium and specialty products. However, for the more price-conscious consumer, we have positioned our Golden Harvest (Registered Trademark) and Lady Dianne (Registered Trademark) as value-priced brands. In doing so, we have been able to minimize the cannibalization from our family of products by lower-priced, discount store brands. To service our home improvement customers, we utilize an internal sales, marketing and customer service staff supported by a network of outside sales representatives. Responsibility for key accounts and product lines is divided amongst managers, who are primarily responsible for building and maintaining relationships with leading customers such as Home Depot and Lowe's. Our internal staff provides customer service, marketing and new product service to customers. The sales and marketing staff is supplemented by independent sales rep organizations, which provide in-store merchandising services and assist the store personnel with stocking, promotional programs and shelf set maintenance. Distribution and Fulfillment We distribute the majority of our branded consumable products through five primary in-house distribution centers and a number of third party warehouses throughout North America. Whenever possible, we utilize highly automated packaging equipment, allowing us to maintain our efficient and effective logistics and freight management processes. We also work with outsourced providers for the delivery of our products in order to ensure that as many shipments as possible are processed as full truckloads, saving significant freight costs. Manufacturing We manufacture the metal closures for our home canning jars at our Muncie, Indiana facility. Lithographed tin plated steel sheet is cut and formed to produce the lids and bands. Liquid plastisol, which we formulate, is applied to lids, forming an airtight seal, which is necessary for safe and effective home canning. Finished products are packaged for integration with glass jars or sold in multi-packs as replacement lids. We manufacture kitchen matches, toothpicks, clothespins and craft items at our Minnesota location. The plant purchases local wood that we convert into veneer, from which we saw, stamp and mold the various wood shapes. The shapes are dried and polished to prepare them for packing. The kitchen match products are put though a secondary manufacturing process to apply the match head and prepare it for packing and shipping to our customers. We manufacture home improvement products utilizing U.S., Mexican and Asian-based manufacturing. North American manufacturing is utilized for shorter runs, new products and special orders, and we operate facilities in Macungie, Pennsylvania; Compton, California; and Merida, Mexico. The Asian component of our home improvement manufacturing platform is comprised of several long-standing sourcing relationships. We have strategic alliances with two Chinese contract manufacturers that have proven to be reliable sources of high-quality products. The combination of flexible, short-run North American operations and low-cost Asian sourcing has allowed us to provide our customers with high quality and low-cost products at industry-leading fill rates. Raw Materials Most of our glass canning jars are supplied under a seven-year supply agreement from Anchor Glass. Such glass materials are also available from other sources at competitive prices. The tin plate, nylon, S-38 metal and resin used in the manufacture of our branded consumables are supplied by multiple vendors and are currently available from a variety of sources at competitive prices. Our wood is also supplied by multiple vendors and is readily available to our wood manufacturing plants from local suppliers. Historically, the raw materials and components that are necessary for the manufacture of our products have been available in the quantities that we require. Intellectual Property We believe that none of our active trademarks or patents are essential to the successful operation of our business as a whole. However, one or more trademarks or patents may be material in relation to individual products or product lines such as our rights to use the Ball (Registered Trademark) , Bernardin (Registered Trademark) , Crawford (Registered Trademark) , Diamond (Registered Trademark) , Forster (Registered Trademark) , Kerr (Registered Trademark) , Lehigh (Registered Trademark) , Leslie-Locke (Registered Trademark) and Storehorse (Registered Trademark) brand names in connection with the sale of our branded consumables. Pursuant to the terms of the 1993 distribution agreement with Ball Corporation ("Ball"), we were granted a license to use the Ball (Registered Trademark) brand name for our branded consumables. In the event of a change of control of Jarden which has not received the approval of a majority of our board of directors or causes us to be controlled or majority owned by a competitor of Ball, Ball has the option to terminate our license to use the Ball (Registered Trademark) brand name. Pursuant to the terms of an agreement with Kerr Group, Inc. ("Kerr"), we have a perpetual exclusive, worldwide license to use the Kerr (Registered Trademark) brand name for our branded consumables. However, in the event of a change of control of Jarden which has not received the approval of a majority of our board of directors, Kerr has the option to terminate our license to use the Kerr (Registered Trademark) brand name. Competition We are the leading provider of branded retail plastic cutlery, home canning products, kitchen matches, rope, cord and twine and toothpicks in North America. We have direct competitors in most of our niche markets. In addition to direct competitors, we compete with companies who specialize in other food preservation mediums such as freezing and dehydration. The market for plastic cutlery is extremely price sensitive and our competitors include Far East and domestic suppliers. Seasonality Sales of our home canning products generally reflect the pattern of the growing season and retail sales of our plastic cutlery are concentrated in the summer months and holiday periods. Sales of our home improvement products are concentrated in the summer months. Sales of these products may be negatively impacted by unfavorable weather conditions and other market trends. Periods of drought, for example, may adversely affect the supply and price of fruit, vegetables, and other foods available for home canning. CONSUMER SOLUTIONS We source, market and distribute an array of home vacuum packaging machines under the market leading FoodSaver (Registered Trademark) brand name. We believe that the FoodSaver (Registered Trademark) vacuum packaging system is superior to more conventional means of food packaging, including freezer and storage bags and plastic containers, in preventing dehydration, rancidity, mold, freezer burn and hardening of food. The original FoodSaver (Registered Trademark) product was successfully launched through infomercials and has since expanded its distribution channels to be based primarily on retail customers. In addition to machines, we market and distribute an expanding line of proprietary bags and bag rolls for use with FoodSaver (Registered Trademark) machines which represent a recurring revenue source, along with accessories including canisters, jar sealers, and wine stoppers. We acquired our home vacuum packaging business effective April 1, 2002. Customers We sell through a diverse group of leading wholesale and retail customers in North America and distributors in selected international markets. We have successfully penetrated several traditional retail S-39 channels including mass merchants, warehouse clubs and specialty retailers and also sell through direct-to-consumer channels, primarily infomercials. Our leading customers in this segment include Bed Bath and Beyond, Costco, Kohl's, Target and Wal-Mart. Sales and Marketing Our consumer solutions sales efforts are led by our internal sales force, who manage house accounts and oversee independent manufacturer representatives. We also sell directly to the consumer through television infomercials, the Internet and other direct to consumer promotions. In addition to generating direct sales, the infomercials serve as an advertising tool creating awareness and demand at retail stores for the product line. Our marketing and sales departments work closely together to develop customized product line and pricing strategies to meet our customers' specialized needs. Our marketing department is implementing a strategy to drive sustained growth over the next few years. Advertising and brand-building programs will extend beyond infomercials. We believe that new product innovation will increasingly capitalize on consumer segmentation opportunities in vacuum packaging and in other food preservation categories. We believe that our retail position will be reinforced by channel marketing initiatives that optimize category volume and profitability for retailers. We intend to expand direct marketing activities to reinforce the brand loyalty and usage rates for bags and accessories. Distribution and Fulfillment We utilize a number of independent warehouses in the United States and an owned warehouse in Canada to distribute our consumer solutions products. Manufacturing Our research and development department designs and engineers home vacuum packaging products in the United States, sets strict engineering specifications for the third-party manufacturers and ensures our proprietary manufacturing expertise despite outsourced production. We maintain ownership over all critical production molds. In order to ensure the quality and consistency of our products manufactured by third party manufacturers in Asia, we employ a team of inspectors who inspect the products we purchase on site at the factories and ensures compliance with our strict quality standards. Appliances are currently sourced through three facilities in China; bags and rolls are currently sourced through suppliers in Korea and the United States; and accessories are sourced from Taiwan, China and the United States. Intellectual Property We own the rights to the FoodSaver (Registered Trademark) brand for use in home vacuum packaging machines, bags and related products and believe there is significant value in this trademark. Additionally, we hold patents throughout many primary worldwide markets on the design of the FoodSaver (Registered Trademark) machine, the related bags and several of the machine components. The key elements of the patented bags are a unique waffle pattern that facilitates air removal, an oxygen barrier layer that prevents air from entering the bag and a heat resistant outer layer to allow easy sealing without burn-through. We have pending patent applications for continually advancing bag and vacuum packaging technologies. Competition Our FoodSaver (Registered Trademark) appliances and bags compete with marketers of "conventional" food storage solutions, such as non-vacuum plastic bags and containers. In addition, our competitors include other manufacturers of home sealing appliances that heat- or vacuum- seal bags, however, as household penetration of home vacuum packaging systems increases, we expect that more competitors will enter the market. There are also several companies that manufacture industrial and commercial vacuum packaging products, but we do not believe that these manufacturers have attempted to enter the household marketplace. Seasonality Sales of our FoodSaver (Registered Trademark) appliances generally are strongest in the fourth quarter preceding the holiday season and may be negatively impacted by unfavorable retail conditions and other market trends. S-40 PLASTIC CONSUMABLES We manufacture, market and distribute a wide variety of plastic products including closures, contact lens packaging, plastic cutlery, refrigerator door liners, shotgun shell casings, surgical devices and syringes. Many of these products are consumable in nature or represent components of consumer products. On February 7, 2003, in conjunction with the acquisition of the business of Diamond, this segment began manufacturing plastic cutlery. In 2001 and prior periods, this segment included the results of our underperforming thermoformed plastics operations, which was sold effective November 26, 2001. Customers We sell primarily to major companies in the healthcare and consumer products industries. Our leading customers include CIBA Vision, Johnson & Johnson, Scotts, Whirlpool and Winchester. We also supply plastic products and parts to both our branded consumables (plastic cutlery and closures) and consumer solutions (plastic containers) segments. Sales and Marketing Our internal sales force and marketing department focus their efforts in those markets that require high levels of precision, quality and engineering expertise. There is potential for continued growth in all product lines, especially in the healthcare market, where our quality, service and "clean room" molding operations are critical competitive factors. Manufacturing We manufacture our plastic consumable products at six owned U.S. facilities and one leased U.K. facility. The injection-molding process involves converting plastic resin pellets to a fluid state through elevated temperature and pressure, at which point the resin is injected into a mold where it is then formed into a finished part. Molded parts are usually small, intricate components that are produced using multi-cavity tooling. Post-molding operations employ robotics and automation for assembly and packaging. The thermoforming process is an operation in which plastic sheet, which we extrude from plastic resin pellets, is converted into a formed product using precision molds and the application of heat. After the product is formed, the process of removing the excess material, or trimming, is generally performed by automated equipment programmed to execute the appropriate steps to produce the finished part to the customer's specifications. Raw Materials We purchase resin from regular commercial sources of supply and, in most cases, multiple sources. The supply and demand for plastic resins is subject to cyclical and other market factors. With the majority of our manufacturing customers, we have the ability to pass-through price increases with an increase in our selling price. This pass-through pricing is not applicable to plastic cutlery, which we supply to our branded consumables segment. OTHER In addition to the three primary business segments described above, our other business consists primarily of our zinc strip business, which is the largest producer of zinc strip and fabricated products in the United States. We are the sole source supplier of copper plated zinc penny blanks to the United States Mint. GOVERNMENT CONTRACTS We enter into contracts with the United States Government, which contain termination provisions customary for government contracts. The United States Government retains the right to terminate such contracts at its convenience. However, if the contract is terminated, we are entitled to be reimbursed for allowable costs and profits to the date of termination relating to authorized work performed to such date. The United States Government contracts are also subject to reduction or modification in the event of changes in government requirements or budgetary constraints. Since entering into a contract with us in 1981, the United States Government has not terminated the penny blank supply arrangement. S-41 ENVIRONMENTAL MATTERS Our operations are subject to Federal, state and local environmental and health and safety laws and regulations, including those that impose workplace standards and regulate the discharge of pollutants into the environment and establish standards for the handling, generation, emission, release, discharge, treatment, storage and disposal of materials and substances including solid and hazardous wastes. We believe that we are in material compliance with such laws and regulations. Further, the cost of maintaining compliance has not, and we believe, in the future, will not, have a material adverse effect on our business, results of operations or financial condition. Due to the nature of our operations and the frequently changing nature of environmental compliance standards and technology, we cannot predict with any certainty that future material capital or operating expenditures will not be required in order to comply with applicable environmental laws and regulations. In addition to operational standards, environmental laws also impose obligations on various entities to clean up contaminated properties or to pay for the cost of such remediation, often upon parties that did not actually cause the contamination. We have attempted to limit our exposure to such liabilities through contractual indemnities and other mechanisms. We do not believe that any of our existing remediation obligations, including at third-party sites where we have been named a potentially responsible party, will have a material adverse effect upon our business, results of operations or financial condition. EMPLOYEES We employ approximately 2,300 people. Approximately 400 union workers are covered by four collective bargaining agreements at three of our United States facilities. These agreements expire at our jar closure facility (Muncie, Indiana) in October 2006, at our kitchen match and toothpick manufacturing facility (Cloquet, Minnesota) in February 2006, and at our metals facility (Greeneville, Tennessee) in October 2003. We have not experienced a work stoppage during the past five years. Management believes that its relationships with our employees and collective bargaining unions are satisfactory. S-42 PROPERTIES Our properties are well maintained, considered adequate and being utilized for their intended purposes. Information regarding the approximate size of our principal manufacturing, warehousing and office facilities is provided below:
APPROXIMATE LOCATION TYPE OF USE BUSINESS SEGMENT SQUARE FEET OWNED/LEASED - ---------------------------- ----------------- --------------------- ------------- ------------- Cloquet, Minnesota Manufacturing Branded Consumables 290,000 Owned Macungie, Pennsylvania Manufacturing / Branded Consumables 270,000 Leased Warehousing Muncie, Indiana Manufacturing Branded Consumables 173,000 Owned Compton, California Manufacturing / Branded Consumables 172,000 Leased Warehouse Kansas City, Missouri Warehousing Branded Consumables 150,000 Leased Wilton, Maine Warehousing Branded Consumables 150,000 Owned Merida, Mexico Manufacturing Branded Consumables 120,000 Owned Tupper Lake, New York Manufacturing Plastic Consumables 159,000 Owned Fort Smith, Arkansas Manufacturing / Plastic Consumables 140,000 Owned Warehousing East Wilton, Maine Manufacturing Plastic Consumables 85,000 Owned Reedsville, Pennsylvania Manufacturing / Plastic Consumables 73,000 Owned Warehousing Greenville, South Carolina Manufacturing / Plastic Consumables 48,000 Owned Warehousing Springfield, Missouri Manufacturing / Plastic Consumables 43,000 Owned Warehousing Greeneville, Tennessee Manufacturing / Other 320,000 Owned Warehousing San Francisco, California Offices Consumer Solutions 49,000 Leased Rye, New York Corporate ------- 4,700 Leased offices
S-43 MANAGEMENT DIRECTORS, EXECUTIVE OFFICERS AND KEY EMPLOYEES The following table sets forth the name, age and position of our directors, executive officers and key employees.
NAME AGE POSITION - ----------------------------- ----- ------------------------------------------------------ Martin E. Franklin .......... 38 Chairman and Chief Executive Officer Ian G.H. Ashken ............. 43 Vice Chairman and Chief Financial Officer James E. Lillie ............. 42 Chief Operating Officer Desiree DeStefano ........... 36 Senior Vice President J. David Tolbert ............ 42 Vice President, Human Resources and Administration Michael Whitcomb ............ 46 Chief Marketing Officer and Vice President, Marketing Rene-Pierre Azria ........... 47 Director Douglas W. Huemme ........... 62 Director Richard L. Molen ............ 63 Director Lynda W. Popwell ............ 58 Director Irwin Simon ................. 45 Director Robert L. Wood .............. 49 Director
Our directors are classified with respect to the period they hold office into three classes, as nearly equal in number as possible. Each director serves a three-year term from the date of the annual meeting at which such director was elected. MARTIN E. FRANKLIN Chairman and Chief Executive Officer Mr. Franklin is our Chairman and Chief Executive Officer. Mr. Franklin was appointed to our Board of Directors on June 25, 2001 and became Chairman and Chief Executive Officer effective September 24, 2001. Mr. Franklin is also a principal and executive officer of a number of private investment entities. Mr. Franklin was the Chairman of the Board of Directors of Bolle Inc. from February 1997 until February 2000. Mr. Franklin has previously held positions as Chairman and Chief Executive Officer of Lumen Technologies, Inc. from May 1996 to December 1998, and Benson Eyecare Corporation from October 1992 to May 1996. Since January 2002, Mr. Franklin has served as the Chairman of the Board and a director of Find/SVP, Inc., a Nasdaq OTC Bulletin Board company. Mr. Franklin also serves as a director of Bally Total Fitness Holding Corporation, a New York Stock Exchange company. IAN G.H. ASHKEN Vice Chairman and Chief Financial Officer Mr. Ashken is Vice Chairman and Chief Financial Officer of the Company. Mr. Ashken was appointed to the Board of Directors on June 25, 2001 and became Vice Chairman, Chief Financial Officer and Secretary effective September 24, 2001. Mr. Ashken is also a principal and executive officer of a number of private investment entities. Mr. Ashken was the Vice Chairman of the Board of Directors of Bolle, Inc. from December 1998 until February 2000. From February 1997 until his appointment as Vice Chairman, Mr. Ashken was the Chief Financial Officer and a director of Bolle. Mr. Ashken previously held positions as Chief Financial Officer and a director of Lumen Technologies, Inc from May 1996 to December 1998 and Benson Eyecare Corporation from October 1992 to May 1996. JAMES E. LILLIE Chief Operating Officer Mr. Lillie joined the Company in August 2003. From 2000 to 2003, Mr. Lillie served as Executive Vice President of Operations at Moore Corporation, Limited, a diversified commercial printing and business communications company. From 1999 to 2000, Mr. Lillie served as Executive Vice President of Operations at Walter Industries, Inc., a Kohlberg, Kravis, Roberts & Company (KKR) Portfolio S-44 Company. From 1990 to 1999, Mr. Lillie held a succession of Managerial Human Resources and Operations positions at World Color, Inc., another KKR Portfolio Company. DESIREE DESTEFANO Senior Vice President Ms. DeStefano serves as the Company's Senior Vice President, working in the areas of finance, treasury, compliance and acquisitions. She joined the Company as Chief Transition Officer and Vice President in 2001. From 2000 to 2001, Ms. DeStefano served as Chief Financial Officer of Sports Capital Partners, a private equity investment fund. Ms. DeStefano served as Vice President of Bolle, Inc. from 1998 to 2000. Also from 1996 to 1998, Ms. DeStefano was Vice President of Lumen Technologies, Inc. Prior to that, Ms. DeStefano held similar positions at Benson Eyecare Corporation and was an audit senior at Price Waterhouse LLP. J. DAVID TOLBERT Vice President, Human Resources and Administration Mr. Tolbert is our Vice President, Human Resources and Administration. From April 1997 to October 1998, Mr. Tolbert served as our Vice President, Human Resources and Corporate Risk. From October 1993 to April 1997, Mr. Tolbert served as our Director of Human Resources. Since joining Ball Corporation in 1987, Mr. Tolbert served in various human resource and operating positions of Ball Corporation's and our former Plastic Packaging Division. MICHAEL WHITCOMB Chief Marketing Officer and Vice President, Marketing Mr. Whitcomb serves as Chief Marketing Officer of the Company. Mr. Whitcomb joined the Company in 2002. From 2001 to 2002, Mr. Whitcomb was a partner at Crossbow Solutions, a management consulting firm based in Orange County, California. From 1999 to 2000, Mr. Whitcomb was President of Equative Inc., a business-to-business internet software company based in Irvine, California. From 1983 to 1999, Mr. Whitcomb held a succession of marketing and general management positions at The Quaker Oats Company. These included Managing Director for Australia and New Zealand, and Director of the Pacific Coast Region for Gatorade. RENE-PIERRE AZRIA Director Mr. Azria has over twenty years of corporate finance experience, working generally on large size transactions with a high degree of complexity. His industry experience is concentrated in technology, media and telecommunications, and also includes healthcare and consumer goods. Prior to joining Rothschild, Inc. in 1996, Mr. Azria served as Managing Director of Blackstone Indosuez and President of Financiere Indosuez in New York. Mr. Azria serves as Chairman of our audit committee. DOUGLAS W. HUEMME Director Mr. Huemme was Chairman and Chief Executive Officer of Lilly Industries, Inc. from 1990 until his retirement in December 2000. He also served as President of Lilly Industries, Inc. from 1990 until April 1999. Mr. Huemme serves as Chairman of our nominating and policies committee. RICHARD L. MOLEN Director Mr. Molen was Chairman, President and Chief Executive Officer of Huffy Corporation from September 1994 until his retirement in December 1997. Mr. Molen served as President and Chief Executive Officer of Huffy Corporation since April 1993, and has served on its Board of Directors since June 1984. Mr. Molen also serves as a director of Huntington Bank and Concrete Technology, Inc. Mr. Molen serves as Chairman of our compensation committee and is a member of our nominating and policies committee. LYNDA WATKINS POPWELL Director Ms. Popwell was President, Carolina Eastman Division of Eastman Chemical Company from January 1998 until her retirement in January 2000. From August 1995 until December 1997, she was Vice President, Health, Safety, Environment and Security and Vice President, Quality of Eastman Chemical Company. Ms. Popwell served as Vice President, Tennessee Eastman Division from October 1994 until July 1995. Ms. Popwell is a member of our audit committee. S-45 IRWIN D. SIMON Director Mr. Simon has been the President and Chief Executive Officer and a director of Hain Celestial Group, Inc., a marketer and distributor of natural, organic and specialty food products and a NASDAQ company ("Hain"), since May 1993. Mr. Simon was appointed Chairman of the Board of Directors of Hain in April 2000. From December 1990 through December 1992, Mr. Simon was employed in various marketing capacities with Slim-Fast Foods Company ("Slim Fast"), a national marketer of meal replacement and weight loss food supplements. In March 1992, Mr. Simon became Vice President of Marketing for Slim Fast. From 1986 through 1990, Mr. Simon held a number of positions with The Haagen-Dazs Company, a manufacturer and distributor of premium ice cream and related products, and its affiliated companies. Mr. Simon also serves as a director of Technology Flavors & Fragrances, Inc. and other privately held companies. Mr. Simon is a member of our compensation committee and nominating and policies committee. ROBERT L. WOOD Director Mr. Wood has been Business Group President for Thermosets and Dow Automotive for The Dow Chemical Company since April 2000. He served as Business Vice President for Polyurethanes of The Dow Chemical Company from May 1997 until April 2000. He served as Business Vice President for Engineering Plastics of Dow Plastics, The Dow Chemical Company from October 1995 until May 1997. Mr. Wood also serves as a director for CoMerica Bank's Midland Region. Mr. Wood is a member of our audit and compensation committees. S-46 SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT The following table sets forth certain information regarding beneficial ownership of our common stock as of September 2, 2003, by (i) each person or entity known to us as a result of their filings pursuant to Sections 13(d) and 13(g) under the Securities Exchange Act of 1934, owning beneficially 5% or more of our Common Stock, (ii) each of our directors and nominees for directors, (iii) each of our executive officers and (iv) all directors and executive officers as a group. Unless otherwise noted, shares are owned directly or indirectly with sole voting and investment power. The following table does not include certain information regarding our common stock known to us as a result of filings pursuant to Section 13(f) of the Securities Exchange Act of 1934.
SHARES BENEFICIALLY NAME AND ADDRESS OWNED (1) PERCENT (2) - ---------------------------------------------------------------------- -------------------- ------------ Bricoleur Capital Management LLC 12230 El Camino Real, Suite 100 San Diego, CA 92130 ................................................. 865,030 (3) 6% Schroder Investment Management North America Inc. 875 Third Avenue, 22nd Floor New York, NY 10022 .................................................. 851,900 (4) 6% Martin E. Franklin ................................................... 1,015,517 (5) 7% Ian G.H. Ashken ...................................................... 297,292 (6) 2% Rene-Pierre Azria .................................................... 20,000 (7) * Desiree DeStefano .................................................... 15,111 (8) * Douglas W. Huemme .................................................... 37,350 (9) * James E. Lillie ...................................................... 38,400 (10) * Richard L. Molen ..................................................... 28,400 (11) * Lynda W. Popwell ..................................................... 39,850 (12) * Irwin D. Simon ....................................................... 20,000 (13) * J. David Tolbert ..................................................... 29,690 (14) * Michael Whitcomb ..................................................... 5,000 (15) * Robert L. Wood ....................................................... 50,000 (16) * All directors and executive officers as a group (12 persons) ......... 1,336,638 (17) 9%
- ---------- * Less than 1% (1) For purposes of this table, a person is deemed to have "beneficial ownership" of any share of common stock that such person has the right to acquire within 60 days. (2) Percent is based on the 14,610,641 shares of common stock outstanding as of September 2, 2003. (3) Based solely on Schedule 13G filed with the Securities and Exchange Commission on February 13, 2003. (4) Based solely on Schedule 13G filed with the Securities and Exchange Commission on February 5, 2003. (5) Includes 250,000 shares of unvested restricted stock. Also includes 259,972 shares of common stock held by Ian G.H. Ashken of which Mr. Franklin disclaims beneficial ownership. Mr. Franklin entered into a voting agreement, dated as of August 22, 2002, with Mr. Ashken, pursuant to which Mr. Franklin has the power to vote, or direct the vote, over all of these 259,972 shares of common stock. Includes 125,000 shares subject to outstanding options to purchase common stock which are exercisable within 60 days. S-47 (6) Includes 90,000 shares of unvested restricted stock. Mr. Ashken entered into a voting agreement, dated as of August 22, 2002, with Mr. Franklin, pursuant to which Mr. Franklin has the power to vote, or direct the vote, over the 259,972 shares of common stock held by Mr. Ashken. Also includes 37,500 shares subject to outstanding options to purchase common stock which are exercisable within 60 days. (7) Consists of 20,000 shares subject to outstanding options to purchase common stock which are exercisable within 60 days. (8) Includes 12,500 shares subject to outstanding options to purchase common stock which are exercisable within 60 days. (9) Includes 36,000 shares subject to outstanding options to purchase common stock which are exercisable within 60 days. (10) Includes 35,000 shares of unvested restricted stock. (11) Includes 16,100 shares subject to outstanding options to purchase common stock which are exercisable within 60 days. (12) Includes 39,000 shares subject to outstanding options to purchase common stock which are exercisable within 60 days. (13) Consists of 20,000 shares subject to outstanding options to purchase common stock which are exercisable within 60 days. (14) Includes 18,000 shares subject to outstanding options to purchase common stock which are exercisable within 60 days. (15) Consists of 5,000 shares subject to outstanding options to purchase common stock which are exercisable within 60 days. (16) Includes 48,000 shares subject to outstanding options to purchase common stock which are exercisable within 60 days. (17) Includes 377,100 shares subject to outstanding options to purchase common stock which are exercisable within 60 days. Also includes 375,000 shares of unvested restricted stock. S-48 UNDERWRITING We have entered into an underwriting agreement with the underwriters named below. CIBC World Markets Corp. and Banc of America Securities LLC are acting as representatives of the underwriters. The underwriting agreement provides for the purchase of a specific number of shares of common stock by each of the underwriters. The underwriters' obligations are several, which means that each underwriter is required to purchase a specified number of shares, but is not responsible for the commitment of any other underwriter to purchase shares. Subject to the terms and conditions of the underwriting agreement, each underwriter has severally agreed to purchase the number of shares of common stock set forth opposite its name below: UNDERWRITER NUMBER OF SHARES - ------------------------------------------ ----------------- CIBC World Markets Corp. ................. 1,070,000 Banc of America Securities LLC ........... 1,070,000 SunTrust Capital Markets, Inc. ........... 374,500 William Blair & Company, L.L.C. .......... 160,500 CJS Securities, Inc. ..................... 93,750 Burnham Securities Inc. ................. 31,250 ----------------- Total ................................... 2,800,000 ================= The underwriters have agreed to purchase all of the shares offered by this prospectus supplement (other than those covered by the over-allotment option described below) if any are purchased. The shares should be ready for delivery on or about September 30, 2003 against payment in immediately available funds. The underwriters are offering the shares subject to various conditions and may reject all or part of any order. The representatives have advised us that the underwriters propose to offer the shares directly to the public at the public offering price that appears on the cover page of this prospectus supplement. In addition, the representatives may offer some of the shares to other securities dealers at such price less a concession of $1.11 per share. The underwriters may also allow, and such dealers may reallow, a concession not in excess of $0.10 per share to other dealers. After the shares are released for sale to the public, the representatives may change the offering price and other selling terms at various times. We have granted the underwriters an over-allotment option. This option, which is exercisable for up to 30 days after the date of this prospectus supplement, permits the underwriters to purchase a maximum of 420,000 additional shares from us to cover over-allotments. If the underwriters exercise all or part of this option, they will purchase shares covered by the option at the public offering price that appears on the cover page of this prospectus supplement, less the underwriting discount. If this option is exercised in full, the total price to the public will be $119,140,000 and the total proceeds to us will be $113,183,000. The underwriters have severally agreed that, to the extent the over-allotment option is exercised, they will each purchase a number of additional shares proportionate to the underwriter's initial amount reflected in the foregoing table. The following table provides information regarding the amount of the discount to be paid to the underwriters by us:
TOTAL WITHOUT EXERCISE OF TOTAL WITH FULL EXERCISE OF PER SHARE OVER-ALLOTMENT OPTION OVER-ALLOTMENT OPTION ----------- --------------------------- ---------------------------- Jarden Corporation ......... $1.85 $5,180,000 $5,957,000
We estimate that our total expenses of the offering, excluding the underwriting discount, will be approximately $750,000. We have agreed to indemnify the underwriters against certain liabilities, including liabilities under the Securities Act of 1933. Subject to exceptions covering up to approximately 90,000 shares of common stock and other shares of common stock as to which beneficial ownership is disclaimed, we, our executive officers and S-49 directors have agreed to a 90-day "lock-up" with respect to primary issuances by us of shares of common stock and all shares of common stock held by such other persons, including securities that are convertible into shares of common stock and securities that are exchangeable or exercisable for shares of common stock. The lock-up restriction will not prohibit us from issuing options and shares under our 2003 Employee Stock Purchase Plan and 2003 Stock Incentive Plan. Any shares issued to our executive officers or directors during the lock-up period in accordance with the immediately preceding sentence will be subject to the lock-up. This means that, for a period of 90 days following the date of this prospectus supplement, we and such persons may not offer, sell, pledge or otherwise dispose of these securities without the prior written consent of CIBC World Markets Corp. and Banc of America Securities LLC. The representatives have informed us that they do not expect discretionary sales by the underwriters to exceed five percent of the shares offered by this prospectus supplement. Certain of the underwriters and their affiliates from time to time in the past have provided investment banking, commercial lending and financial advisory services to us in the ordinary course of business for which we have paid customary compensation, and the underwriters and their affiliates may provide such services from time to time in the future for which we would expect to pay customary compensation. Without limiting the generality of the preceding sentence, affiliates of CIBC World Markets Corp., Banc of America Securities LLC and SunTrust Capital Markets, Inc. are lenders under our existing credit facility and have received customary compensation in connection therewith. In addition, an affiliate of Banc of America Securities LLC is the agent under our credit facility and receives customary compensation in connection therewith. An undetermined portion of the net proceeds of the sale of the shares may ultimately be used to repay indebtedness under our credit facility, in which case affiliates of CIBC World Markets Corp., Banc of America Securities LLC and SunTrust Capital Markets, Inc. would receive their pro rata share of such net proceeds. Because the amount of such repayment, if any, is indeterminable and because affiliates of the underwriters listed in the preceding sentence could receive more than ten percent of the net proceeds of this offering, depending on the amount of such repayment, this offering is being made in compliance with the requirements of Rule 2710(c)(8) of the National Association of Securities Dealers, Inc. Conduct Rules. Rules of the Securities and Exchange Commission may limit the ability of the underwriters to bid for or purchase shares before the distribution of the shares is completed. However, the underwriters may engage in the following activities in accordance with the rules: o Stabilizing transactions -- The representatives may make bids or purchases for the purpose of pegging, fixing or maintaining the price of the shares, so long as stabilizing bids do not exceed a specified maximum. o Over-allotments and syndicate covering transactions -- The underwriters may sell more shares of our common stock in connection with this offering than the number of shares the underwriters have committed to purchase. This over-allotment creates a short position for the underwriters. This short sales position may involve either "covered" short sales or "naked" short sales. Covered short sales are short sales made in an amount not greater than the underwriters' over-allotment option to purchase additional shares in this offering described above. The underwriters may close out any covered short position either by exercising their over-allotment option or by purchasing shares in the open market. To determine how they will close the covered short position, the underwriters will consider, among other things, the price of shares available for purchase in the open market, as compared to the price at which they may purchase shares through the over-allotment option. Naked short sales are short sales in excess of the over-allotment option. The underwriters must close out any naked short position by purchasing shares in the open market. A naked short position is more likely to be created if the underwriters are concerned that, in the open market after pricing, there may be downward pressure on the price of the shares that could adversely affect investors who purchase in this offering. S-50 o Penalty bids -- If the representatives purchase shares in the open market in a stabilizing transaction or syndicate covering transaction, they may reclaim a selling concession from the underwriters and selling group members who sold these shares as part of this offering. Similar to other purchase transactions, the underwriters' purchases to cover the syndicate short sales or to stabilize the market price of our common stock may have the effect of raising or maintaining the market price of our common stock or preventing or mitigating a decline in the market price of the common stock. As a result, the price of the shares of our common stock may be higher than the price that might otherwise exist in the open market. The imposition of a penalty bid might also have an effect on the price of the shares if it discourages resales of the shares. Neither we nor the underwriters make any representation or prediction as to the effect that the transactions described above may have on the price of the shares. These transactions may occur on The New York Stock Exchange or otherwise. If such transactions are commenced, they may be discontinued without notice at any time. A prospectus in electronic format may be made available on web sites maintained by one or more of the underwriters or selling group members participating in this offering. The representatives may agree to allocate a number of shares to underwriters and selling group members for sale to their online brokerage account holders. Internet distributions will be allocated by the underwriters and selling group members on the same basis as other allocations. EXPERTS The consolidated financial statements of Jarden Corporation and its subsidiaries appearing in its Annual Report (Form 10-K) for the year ended December 31, 2002, have been audited by Ernst & Young LLP, independent auditors, as set forth in their report thereon included therein and incorporated herein by reference. Such consolidated financial statements are incorporated herein by reference in reliance upon such report given on the authority of such firm as experts in accounting and auditing. The consolidated financial statements of Diamond Brands International, Inc. and its subsidiaries appearing in the Company's Current Report on Form 8-K/A filed on March 7, 2003 for the year ended December 31, 2002, have been audited by Ernst & Young LLP, independent auditors, as set forth in their report thereon included therein and incorporated herein by reference. Such consolidated financial statements are incorporated herein by reference in reliance upon such report given on the authority of such firm as experts in accounting and auditing. The consolidated financial statements of Lehigh Consumer Products Corporation as of December 31, 2002 and for the year then ended, incorporated in this Prospectus by reference to the Company's Current Report on Form 8-K dated September 5, 2003, have been so incorporated in reliance on the report of PricewaterhouseCoopers LLP, independent accountants, given on authority of said firm as experts in auditing and accounting. LEGAL MATTERS The validity of the common stock offered hereby will be passed upon for us by Kane Kessler, P.C., New York, New York. Certain legal matters will be passed upon for the underwriters by Cahill Gordon & Reindel LLP, New York, New York. S-51 PROSPECTUS JARDEN CORPORATION $150,000,000 DEBT SECURITIES, COMMON STOCK, PREFERRED STOCK, AND WARRANTS ---------------- We may from time to time sell up to $150,000,000 aggregate initial offering price of one or more series of our debt securities, our common stock, $0.01 par value per share, our preferred stock, $0.01 par value per share, our warrants to purchase debt securities, common stock, or preferred stock, or any combination of our debt securities, common stock, preferred stock, and warrants. These debt securities may consist of notes, debentures or other types of debt. We will provide specific terms of these debt securities in supplements to this prospectus. Our payment obligations under any series of debt securities may be guaranteed by one or more of our subsidiaries which are co-registrants. This prospectus provides a general description of the securities we may offer. The specific terms of the securities offered by this prospectus will be set forth in a supplement to this prospectus and will include, among other things: o in the case of common stock, the number of shares, purchase price, and terms of the offering and sale thereof; o in the case of preferred stock, the number of shares, purchase price, the designation and relative rights, preferences, limitations and restrictions, and the terms of the offering and sale thereof; o in the case of debt securities, the specific designation, aggregate principal amount, purchase price, maturity, interest rate, time of payment of interest, terms (if any) for the subordination or redemption thereof, and any other specific terms of the debt securities; and o in the case of warrants, the title, aggregate number, price at which it will be issued, exercise price, and designation, aggregate principal amount and terms of the securities issuable upon exercise of the warrants. Any prospectus supplement may also add, update or change information contained in this prospectus. You should read this prospectus, any prospectus supplement and the additional information described under "Where You Can Find More Information" carefully before you invest in our securities. Our common stock trades on the New York Stock Exchange under the symbol "JAH." On January 28, 2003, the last reported sale price of our shares on the New York Stock Exchange was $26.06 per share. The securities may be sold through underwriters or dealers designated from time to time or to other purchasers directly or through agents designated from time to time (see "Plan of Distribution"). ---------------- Please refer to "Risk Factors" beginning on page 9 and in any prospectus supplement for a description of the risks you should consider when evaluating this investment. ---------------- NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED OF THE SECURITIES TO BE ISSUED IN THE EXCHANGE OR DETERMINED IF THIS PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. The date of this prospectus is January 31, 2003. TABLE OF CONTENTS
PAGE ----- Summary .................................................................................. 1 Incorporation of Certain Documents by Reference .......................................... 2 The Company .............................................................................. 3 Risk Factors ............................................................................. 9 Reductions, cancellations, or delays in customer purchases would adversely affect our profitability ......................................................................... 9 We may be adversely affected by the trend towards retail trade consolidation ............ 9 Sales of some of our products are seasonal and weather related .......................... 9 We depend on suppliers in Asia .......................................................... 9 Competition in our industries may hinder our ability to execute our business strategy, achieve profitability, or maintain relationships with existing customers .............. 10 If we fail to develop new or expand existing customer relationships, our ability to grow our business will be impaired ......................................................... 11 We cannot be certain that our product innovations and marketing successes will continue . 11 We may experience difficulty in integrating acquired businesses, which may interrupt our business operations ................................................................... 11 Our operations are subject to a number of Federal, state and local environmental regulations ............................................................................ 11 We may be adversely affected by remediation obligations mandated by applicable environmental laws .................................................................... 11 We depend upon key personnel ............................................................ 12 We enter into contracts with the United States government and other governments ......... 12 Our operating results can be adversely affected by changes in the cost or availability of raw materials ...................................................................... 12 Our business could be adversely affected because of risks which are particular to international operations .............................................................. 12 Our performance can fluctuate with the financial condition of the retail industry ....... 13 Claims made against us based on product liability could have a material adverse effect on our business ....................................................................... 13 We depend on our patents and proprietary rights ......................................... 13 We depend on a single manufacturing facility for certain essential products ............. 13 Certain of our employees are represented by labor unions ................................ 14 Our significant indebtedness could adversely affect our financial health, and prevent us from fulfilling our obligations under our debt ........................................ 14 We will require a significant amount of cash to service our indebtedness. Our ability to generate cash depends on many factors beyond our control .............................. 14 The indenture related to the debt securities, our 9 3/4% senior subordinated notes due 2012, and our senior credit facility contain various covenants which limit our management's discretion in the operation of our business .............................. 15 We may not have the ability to raise the funds necessary to finance the change of control offer required by the indenture related to our 9 3/4% senior subordinated notes due 2012 ........................................................................ 15 Delaware law and our rights plan may limit possible takeovers ........................... 15 The market price for our common stock is volatile ....................................... 16 We may issue a substantial amount of our common stock in connection with future acquisitions and the sale of those shares could adversely affect our stock price ...... 16 Our stock price may be adversely affected if our stockholders sell substantial amounts of our common stock, or our preferred stock or warrants convertible into our common stock, in the public market following the offering .................................... 16
ii
PAGE ----- Since we have broad discretion in how we use the net proceeds from this offering, we may use such proceeds in ways with which you disagree ..................................... 17 Your right to receive payments on the debt securities is junior to our existing senior indebtedness and possibly all of our future borrowings. Further, the guarantees of the debt securities are junior to all of the guarantors' existing senior indebtedness and possibly to all their future borrowings ............................................... 17 Since the debt securities are unsecured, your right to enforce remedies is limited by the rights of holders of secured debt ................................................. 17 Not all of our subsidiaries will guarantee our obligations under the debt securities, and the assets of the non-guarantor subsidiaries may not be available to make payments on the debt securities ................................................................ 17 A public market for the debt securities may not develop ................................. 18 Federal and state statutes allow courts, under specific circumstances, to void guarantees and require security holders to return payments received from guarantors ... 18 Forward Looking Statements ............................................................... 20 Use of Proceeds .......................................................................... 21 Ratio of Earnings to Fixed Charges ....................................................... 21 Description of Debt Securities ........................................................... 22 Description of Capital Stock ............................................................. 27 Description of Warrants .................................................................. 27 Description of Senior Indebtedness ....................................................... 28 Plan of Distribution ..................................................................... 32 Where You Can Find More Information ...................................................... 33 Experts .................................................................................. 33 Legal Matters ............................................................................ 34
iii SUMMARY This prospectus is part of a registration statement that Jarden Corporation and the co-registrants (together, the "registrants") filed with the Securities and Exchange Commission utilizing a "shelf" registration process. Under this shelf registration process, the registrants may sell any combination of the securities described in this prospectus in one or more offerings up to a total dollar amount of $150,000,000. This prospectus provides you with a general description of the securities the registrants may offer. Each time the registrants sell securities, the registrants will provide a prospectus supplement that will contain specific information about the terms of that offering. To understand the terms of our securities, you should carefully read this document with the applicable prospectus supplement, which may add, update, or change information. Together these documents will give the specific terms of the securities we are offering. You should also read the documents we have incorporated by reference in this prospectus and in any prospectus supplement. THE SECURITIES WE MAY OFFER This prospectus is part of a registration statement that we filed with the Securities and Exchange Commission using a "shelf" registration process. Under the shelf registration process, we may offer from time to time up to an aggregate of $150,000,000 of one or more series of our debt securities, our common stock, $0.01 par value per share, our preferred stock, $0.01 par value per share, our warrants to purchase debt securities, common stock, or preferred stock, or any combination of our debt securities, common stock, preferred stock, and warrants. DEBT SECURITIES The terms of each series of debt securities will be detailed or determined in the manner provided in an indenture. The particular terms of each series of debt securities will be described in a prospectus supplement relating to the series, including any pricing supplement. We will set forth in a prospectus supplement (including any pricing supplement) relating to any series of debt securities being offered, among other things, the initial offering price, the aggregate principal amount the price or prices at which we will sell the debt securities, any limit on the aggregate principal amount of the debt securities, the date or dates on which we will pay the principal on the debt securities, and the rate or rates at which the debt securities will bear interest. We have summarized general features of our debt securities under the section entitled "Description of Debt Securities" contained in this prospectus. COMMON STOCK We may issue common stock, par value $0.01 per share. Holders of our common stock are entitled to receive dividends when declared by our board of directors, subject to the rights of holders of our preferred shares. Each holder of common shares is entitled to one vote per share. The holders of common shares have no preemptive or cumulative voting rights. Our credit facility contains restrictions on our ability to pay dividends or make other distributions. PREFERRED STOCK We may issue preferred stock, par value $0.01 per share, in one or more series. Subject to the terms of our governing documents and applicable Delaware law, our board of directors will determine the dividend, voting, conversion and other rights and preferences of the series of preferred stock being offered. WARRANTS We may issue warrants for the purchase of debt securities, preferred stock or common stock either independently or together with other securities. Each warrant will entitle the holder to purchase the principal amount of our debt securities, or the number of shares of preferred stock or common stock, at the exercise price set forth in, or calculable as set forth in, the applicable prospectus supplement. 1 ---------------- The mailing address and telephone number of our principal executive offices are 555 Theodore Fremd Avenue, Rye, New York, 10580, (914) 967-9400. INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE The following documents heretofore filed by us with the Securities and Exchange Commission (the "Commission") pursuant to the Securities Exchange Act of 1934, as amended (the "Exchange Act"), are hereby incorporated by reference in this prospectus, except as superseded or modified herein: (a) Our annual report on Form 10-K/A for the fiscal year ended December 31, 2001; (b) Our quarterly report on Form 10-Q/A for the period ended March 31, 2002; (c) Our quarterly report on Form 10-Q/A for the period ended June 30, 2002; (d) Our quarterly report on Form 10-Q for the period ended September 30, 2002; (e) Our current report on Form 8-K, Date of Event -- December 18, 2001, filed on January 9, 2002; (f) Our current report on Form 8-K, Date of Event -- March 28, 2002, filed on March 28, 2002; (g) Our current report on Form 8-K, Date of Event -- March 28, 2002, filed on March 29, 2002; (h) Our current report on Form 8-K, Date of Event -- April 24, 2002, filed on May 9, 2002; (i) Our current report on Form 8-K, Date of Event -- May 30, 2002, filed on June 4, 2002; (j) Our current report on Form 8-K, Date of Event -- October 17, 2002, filed on October 24, 2002; (k) Our current report on Form 8-K, Date of Event -- October 28, 2002, filed on October 29, 2002; (l) Our current report on Form 8-K, Date of Event -- November 1, 2002, filed on November 1, 2002; (m) Our current report on Form 8-K, Date of Event -- January 7, 2003, filed on January 10, 2002; (n) Our definitive proxy statement on Schedule 14A filed on April 30, 2002; (o) The description of our common stock contained in our registration statement on Form 8-A/A filed on May 1, 2002, including any amendments or reports filed for the purpose of updating that description; and (p) The description of the preferred stock purchase rights of our common stock contained in our registration statement on Form 8-A/A filed on May 1, 2002, including any amendments or reports filed for the purpose of updating that description. All of such documents are on file with the Commission. In addition, all documents filed by Jarden Corporation pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act, subsequent to the date of this prospectus and prior to termination of the offering are incorporated by reference in this prospectus and are 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 contained herein or in any subsequently filed document that is also incorporated by reference herein modifies or replaces such statement. Any statements so modified or superseded shall not be deemed, except as so modified or superseded, to constitute a part of this prospectus. This prospectus incorporates herein by reference important business and financial information about us that is not included in or delivered with this prospectus. This information is available to you without charge upon written or oral request. If you would like a copy of any of this information, please submit your request to Jarden Corporation, 555 Theodore Fremd Avenue, Rye, NY 10580, Attention: Corporate Secretary, or call (914) 967-9400. 2 THE COMPANY Jarden Corporation is a leading provider of niche consumer products used in home food preservation. We operate two distinct business groups, consumer products and material based. Our consumer products group markets and distributes the FoodSaver (Registered Trademark) line, which is the U.S. market leader in home vacuum packaging systems and accessories and is the leading North American manufacturer, distributor and marketer of home canning and related products, primarily under the Ball (Registered Trademark) , Kerr (Registered Trademark) and Bernardin (Registered Trademark) brands. Our materials based group is the country's largest producer of zinc strip and is a plastics manufacturer. During 2001, we repositioned our growth strategy to focus on consumer products. Alltrista Consumer Products manufactures, markets and distributes a broad line of home food preservation and preparation products that includes recognized brand name home canning jars, jar closures and other accessories (including fruit pectin, Fruit-Fresh (Registered Trademark) brand fruit protector, pickle mixes and tomato mixes). As of April 24, 2002, through the acquisition of Tilia International, Inc. and its subsidiaries ("Tilia"), our consumer products group markets and distributes the FoodSaver (Registered Trademark) vacuum packaging system. Vacuum packaging is the process of removing air from a container to create a vacuum, and then sealing the container so that air cannot re-enter. Our materials based group is comprised of three business segments: metals, injection molded plastics, and other. Our metals business is the sole source supplier of copper plated zinc penny blanks to both the United States Mint and the Royal Canadian Mint. In addition, we manufacture a line of industrial zinc items used in the plumbing, automotive, electrical component and European architectural markets, and the Lifejacket (Registered Trademark) anti-corrosion system. Our plastic injection molding business manufactures precision custom components for major companies in the healthcare and consumer products industries including CIBA Vision Corporation, Johnson & Johnson, Meridian Diagnostics, Inc., The Scotts Company and Winchester Ammunition. The other segment includes the manufacturing of non-injection molded plastic parts and other immaterial business activities. RECENT DEVELOPMENTS Diamond Acquisition On November 27, 2002, we entered into an Asset Purchase Agreement to purchase the business assets and liabilities of Diamond Brands Operating Corp. and its affiliates ("Diamond Brands"), a leading manufacturer and marketer of niche consumer products for domestic use including matches, toothpicks, disposable plastic cutlery, straws, clothespins and wooden crafts sold primarily under the Diamond Brands (Registered Trademark) and Forster (Registered Trademark) trademarks. The acquisition of Diamond Brands has been approved in the United States Bankruptcy Court for the District of Delaware as the exclusive plan to be voted on by the creditors. Our acquisition of Diamond Brands is subject to final confirmation by the United States Bankruptcy Court for the district of Delaware, Hart-Scott-Rodino approval, and other customary closing conditions. Although we cannot assure you that any and all these conditions will be satisfied, at this time, we believe that we will complete the acquisition during the first quarter of 2003. We intend to finance our acquisition of Diamond Brands at closing with the combination of available cash and borrowings under our credit facility. The purchase price for the sale and transfer of the assets shall consist of: (a) an aggregate amount equal to the sum of the following: (i) $12,950,000 in cash, (ii) the balance, as of the closing, of the principal amount due under a DIP loan agreement, taking into account all payments made in respect of such principal amount by the debtors through the closing, plus (b) at Jarden's election, within six months after the closing (i) either $6 million in cash payable by wire transfer in immediately available funds or (ii) shares of Jarden common stock with an aggregate fair market value of $6 million as of the date of delivery; and (c) the assumption of certain liabilities. Exchange Offer On December 4, 2002, we completed an offer to the holders of our 9 3/4% senior subordinated notes subject to Rule 144A of the Securities Act of 1933 to exchange those notes for our 9 3/4% senior 3 subordinated notes which are registered under the Securities Act of 1933, as amended, and are substantially similar to the old notes except that the mandatory redemption provisions and the transfer restrictions applicable to the old notes are not applicable to the new notes. Substantially all of the $150,000,000 aggregate principal amount of the old notes were exchanged for the new notes. CONSUMER PRODUCTS GROUP The consumer products group is comprised of two segments: vacuum packaging and domestic consumables. Our domestic consumables segment manufactures, markets and distributes a line of home food preservation products to serve value, mid-tier and premium oriented customers, which products include home canning jars, jar closures, home canning tools, and other accessories. These products are marketed under the well-known Ball (Registered Trademark) , Bernardin (Registered Trademark) , Golden Harvest (Registered Trademark) , and Kerr (Registered Trademark) brand names. We also market and distribute related food products, including fruit pectin, Fruit-Fresh (Registered Trademark) brand fruit protector, pickle mixes, tomato mixes and all-in-one canning kits, including a jam pectin kit and jelly and salsa kits. In addition, we market a line of housewares under the Golden Harvest (Registered Trademark) brand, including tumblers, beverage tappers and other glassware. We also provide patented vacuum packaging systems for household use marketed under the FoodSaver (Registered Trademark) brand. Our seven models of compact, patented counter-top FoodSaver (Registered Trademark) appliances incorporate a vacuum pump and bag sealer to keep foods fresh and are sold at prices ranging from approximately $100 to almost $300. We market our FoodSaver (Registered Trademark) appliances in tandem with our patented FoodSaver (Registered Trademark) bags and rolls and complementary accessories, including canisters, containers, lids, jar sealers and bottle stoppers. Customers Our customers are a diverse group of wholesalers and retailers in the United States and Canada. Our principal customers include grocery stores, mass merchants, warehouse clubs, and hardware stores, but we also sell through sporting goods and outdoor stores and specialty retailers. We have been Wal-Mart's category manager for the home canning segment since 1998. In this role, we are responsible for the home canning section within the store, including inventory management, the introduction of new items, and the creation of various reports to track inventory, sales, and margins. In addition to these channels of distribution, vacuum packaging products are sold directly to individual consumers through direct-to-consumer channels. Our direct-to-consumer sales have primarily been made through infomercials and catalogs. Sales and Marketing Our consumer products sales are made in the United States and Canada through food brokers and manufacturer representative organizations as well as through our internal sales force and house accounts. We employ regional sales managers located in key geographic areas who oversee the sales and retail activities of food brokerage firms and independent manufacturer representatives. Distribution and Fulfillment We utilize company-operated and independent warehouses located in various regions of the United States and Canada to distribute our products. The largest of these warehouses is located in Muncie, Indiana and is operated by an outsourced provider, which utilizes highly automated packaging equipment allowing us to maintain our efficient and effective logistics and freight management processes. We also work with an outsourced provider for the delivery of our products in order to ensure that as many shipments as possible are processed as full truckloads, saving significant freight costs. Manufacturing We manufacture the metal closures for our home canning jars at our Muncie, Indiana facility. Lithographed tin plated steel sheet is cut and formed to produce the lids and bands. Liquid plastisol, which we formulate, is applied to lids, forming an airtight seal, which is necessary for safe and effective home canning. Finished products are packaged for integration with glass jars or sold in multi-packs as replacement lids. 4 Vacuum packaging products are sourced through a network of independent manufacturers. Appliances are currently sourced through three facilities in China; bags and rolls are currently sourced through suppliers in Korea and the United States; and accessories are sourced from Taiwan, China and the United States. Our own research and development department designs and engineers products in the United States and sets strict engineering specifications for the third-party manufacturers. We maintain ownership over all necessary production molds. Intellectual Property Management believes that none of our active trademarks or patents is essential to the successful operation of our business as a whole. However, one or more trademarks or patents may be material in relation to individual products or product lines such as our property rights to use the Ball (Registered Trademark) , FoodSaver (Registered Trademark) , Fruit-Fresh (Registered Trademark) , Golden Harvest (Registered Trademark) , and Kerr (Registered Trademark) brand names and the Bernardin (Registered Trademark) trade name in connection with certain goods to be sold, including home food preservation supplies, kitchen housewares and packaged foods for human consumption. We hold patents throughout many primary worldwide markets on both the design of the FoodSaver (Registered Trademark) appliance itself as well as on many of its components. Our patent on the FoodSaver (Registered Trademark) vacuum seal appliance expires in 2009, and our patent on FoodSaver (Registered Trademark) bags expires in 2005. The key elements of the bag are a unique waffle pattern that facilitates air removal, an oxygen barrier layer that prevents air from entering the bag and a heat resistant outer layer to allow easy sealing without burn-through. In addition, we have registered the VacLoc, SaverMate, VacuTop and VacuSave names with the U.S. Patent and Trademark Office and in several countries throughout the world. In addition, we have developed a proprietary two-piece closure system incorporating a plastisol sealant that differentiates our jar lids from our competitors' lids. We have pending patent applications for new technology for bags and vacuum packaging systems that we recently acquired. Pursuant to the terms of the 1993 distribution agreement with Ball Corporation, we were granted a license to use the Ball (Registered Trademark) brand name for our consumer products. In the event of a change of control of Jarden which has not received the approval of a majority of our board of directors or causes us to be controlled or majority owned by a competitor of Ball, Ball has the option to terminate our license to use the Ball (Registered Trademark) brand name. Pursuant to the terms of an agreement with Kerr Group, Inc., we have a perpetual exclusive, worldwide license to use the Kerr (Registered Trademark) brand name in our consumer products division. However, in the event of a change of control of Jarden which has not received the approval of a majority of our board of directors, Kerr has the option to terminate our license to use the Kerr (Registered Trademark) brand name. Raw Materials Most of our glass canning jars are supplied under an agreement with Anchor Glass Container Corporation. Such glass materials are also available from a variety of other sources at competitive prices. The tin plate raw material used in the manufacture of our home canning jar lids and closures is supplied by multiple vendors and is currently available from a variety of sources at competitive prices. Historically, the raw materials and components that are necessary for the manufacture of our products have been available in the quantities that we require. Competition We are the leading provider of home canning products and related accessories and our brands represent a significant portion of the sales in this niche market. In addition to the competitors in our niche market, we compete with companies who specialize in other food preservation mediums such as freezing and dehydration. Our vacuum packaging appliances compete with marketers of "conventional" food storage solutions, such as plastic bags and containers. In addition, our competitors include manufacturers of sealing appliances that heat-seal bags, but, we believe, do not create a vacuum seal comparable to ours. There are also several companies that manufacture industrial and commercial vacuum packaging products, but we do not believe that these manufacturers have attempted to enter the household marketplace. 5 MATERIALS BASED GROUP Our materials based group is currently comprised of three business segments: metals, injection molded plastics, and other. METALS We believe our zinc strip business is the largest producer of zinc strip and fabricated products in the United States. We are the sole source supplier of copper plated zinc penny blanks to both the United States Mint and the Royal Canadian Mint and are currently exploring opportunities with several other countries. In addition, we manufacture a line of industrial zinc items used in the plumbing, automotive, electrical component and European architectural markets, and the Lifejacket (Registered Trademark) anti-corrosion system. Our anticorrosion zinc Lifejacket (Registered Trademark) is gaining recognition as a cost-effective solution to arrest the corrosion of the reinforcement steel within poured concrete structures. We are affected by fluctuations in penny blank requirements of the United States Department of the Treasury and the Federal Reserve System. Although the future use of the penny as legal tender has been debated in recent years, management believes that the zinc based coinage will remain an important part of the currency system for the foreseeable future. Sales and Marketing Our sales and marketing staff consists of individuals with considerable technical background in the field of metallurgy. These individuals focus on leveraging our core capabilities in zinc metallurgy and electrochemistry to exploit new market opportunities. The sales and marketing staff works closely with our engineering and technical services group to deliver products to the customer. We maintain a website which contains technical information regarding the advantageous physical properties of zinc versus other metals. Manufacturing In our Greenville, Tennessee facility, we manufacture alloys of zinc strip and fabricated zinc products in a number of configurations for our customers. We have five lines used to slit the coils into widths specified by customers. Many customers require less than the full master coil diameters, so the large coils are broken down into the requested diameters at the time they are slit. We also produce coin blanks stamped from slit coils using one of five high-speed presses. The stamped blanks are then rimmed and put into one of three electroplating lines where the copper coating is applied. Raw Materials We purchase special high-grade zinc ingot and a variety of metals, including copper, lead, titanium, magnesium, manganese and other alloys, to produce the zinc alloys we use in our various applications. These alloys have been developed by our technical staff to meet the specific physical and chemical characteristics of the finished product applications. We purchase zinc ingot based on market prices quoted on the London Metals Exchange (month-end average price) from a variety of suppliers. Certain customers, including the United States Mint, provide their own purchased zinc that is utilized to manufacture product at a toll conversion price. We purchase copper for both alloying and plating purposes based on market prices quoted on the New York Commodities and Metals Exchange. As with zinc ingot, the United States Mint supplies the required copper for one-cent coin blanks. We also purchase a variety of chemicals for production and waste treatment, primarily for use in copper plating. Prices for chemicals are negotiated with suppliers based on market supply and demand conditions and volume purchase levels. INJECTION MOLDED PLASTICS We manufacture precision custom injection molded components for major companies in the healthcare and consumer products industries. We also own Yorker (Registered Trademark) Closures, a proprietary product line of plastic closures. Products for the healthcare industry include items such as intravenous harness components and surgical devices. Products for manufacturers of consumer goods primarily include packaging and sport shooting ammunition components. 6 Customers We supply shotgun shell components to Winchester Ammunition and various healthcare products (such as contact lens cases) to CIBA Vision Corporation, Ethicon, Inc., Johnson & Johnson, CB Fleet Company, Inc., and Meridian Diagnostics, Inc. and consumer products for The Scotts Company, among others. Sales and Marketing We concentrate our marketing efforts in those markets that require high levels of precision, quality, and engineering expertise. There is potential for continued growth in all product lines, especially in the healthcare market, where our quality, service and "clean room" molding operations are critical competitive factors. Manufacturing We manufacture at three facilities located in Greenville, South Carolina; Reedsville, Pennsylvania; and Springfield, Missouri. The injection-molding process involves converting plastic resin pellets to a fluid state through elevated temperature and pressure, at which point the resin is injected into a mold where it is then formed into a finished part. Molded parts are usually small, intricate components that are produced using multi-cavity tooling. Post-molding operations employ robotics and automation for assembly and packaging. Raw Materials We purchase resin from regular commercial sources of supply and, in most cases, multiple sources. The supply and demand for plastic resins are subject to cyclical and other market factors. Competition The market for injection molded plastics is highly competitive. We concentrate our marketing efforts in those markets that require high levels of precision, quality, engineering expertise and cleanliness. We have differentiated ourselves from our competitors by developing long-lasting relationships with a number of specialty tooling manufacturers and by possessing strong design capabilities. We believe that the quality and cleanliness of our facilities provides another competitive advantage for us. As a result, we believe that we will continue to capture new injection molding programs as they come to market, as well as benefit from continued outsourcing trends among original equipment manufacturers. OTHER Effective November 26, 2001, we sold our underperforming thermoformed plastics operations consisting of the assets of our Triangle, TriEnda and Synergy World divisions (the "TPD Assets") to Wilbert, Inc. for $21.0 million in cash, a $1.9 million noninterest-bearing one-year note, and the assumption of certain identified liabilities. We recorded a pre-tax loss of $121.1 million in 2001 related to the sale. Effective November 1, 2001, we sold our majority interest in Microlin, LLC, a developer of proprietary battery and fluid delivery technology, for $1,000 in cash plus contingent consideration based upon future performance through December 31, 2012 and the cancellation of future funding requirements. We recorded a pre-tax loss of $1.4 million in 2001 related to the sale. Currently, our other business primarily manufactures thermoformed plastic white goods for a variety of customers in our Fort Smith, Arkansas facility. We also manufacture and sell extruded plastic sheet and roll stock products in smooth, textured and laminated finishes for a variety of customers. Additionally, we produce plastic tables for original equipment manufacturers in our Fort Smith plant and have a proprietary line of tables selling under the VisionTM brand that are primarily sold to the hospitality and institutional markets. Our customers are primarily other equipment manufacturers. Our products are produced through a thermoforming process. Thermoforming is an operation in which plastic sheet is converted into a formed product through single- or twin-sheet vacuum or 7 pressure formed in conjunction with the application of heat. After the product is formed, the process of removing the excess material, or trimming, is generally performed by automated equipment programmed to execute the appropriate steps to produce the finished part to the customer's specifications. We purchase resin directly for use in the manufacture of extruded sheet and also purchase plastic sheet from third-party suppliers in those instances where we are unable to provide for our needs internally. These raw materials are obtained from regular commercial sources of supply and, in most cases, multiple sources. The supply and demand for plastic resins are subject to cyclical and other market factors. Certain of our customers purchase the resin on our behalf, thereby providing us protection from price fluctuations. GOVERNMENT CONTRACTS We enter into contracts with the United States Government which contain termination provisions customary for government contracts. See "Metals" under the materials based group discussion above. The United States Government retains the right to terminate such contracts at its convenience. However, if the contract is terminated, we are entitled to be reimbursed for allowable costs and profits to the date of termination relating to authorized work performed to such date. The United States Government contracts are also subject to reduction or modification in the event of changes in government requirements or budgetary constraints. Since entering into a contract with us in 1981, the United States Government has not terminated the penny blank supply arrangement. ENVIRONMENTAL MATTERS Our operations are subject to Federal, state and local environmental and health and safety laws and regulations, including those that impose workplace standards and regulate the discharge of pollutants into the environment and establish standards for the handling, generation, emission, release, discharge, treatment, storage and disposal of materials and substances including solid and hazardous wastes. We believe that we are in material compliance with such laws and regulations. Further, the cost of maintaining compliance has not, and we believe, in the future, will not, have a material adverse effect on our business, results of operations or financial condition. Due to the nature of our operations and the frequently changing nature of environmental compliance standards and technology, we cannot predict with any certainty that future material capital or operating expenditures will not be required in order to comply with applicable environmental laws and regulations. In addition to operational standards, environmental laws also impose obligations on various entities to clean up contaminated properties or to pay for the cost of such remediation, often upon parties that did not actually cause the contamination. We have attempted to limit our exposure to such liabilities through contractual indemnities and other mechanisms. We do not believe that any of our existing remediation obligations, including at third-party sites where we have been named a potentially responsible party, will have a material adverse effect upon our business, results of operations or financial condition. EMPLOYEES As of September 30, 2002, we employed approximately 950 people. Approximately 215 union workers are covered by two collective bargaining agreements at our metals and domestic consumables manufacturing facilities. These agreements expire at the domestic consumables facility (Muncie, Indiana) on October 15, 2006, and at the metals facility (Greeneville, Tennessee) on October 4, 2003. We have not experienced a work stoppage during the past five years. Management believes that its relationships with our employees and collective bargaining unions are satisfactory. Our principal executive offices are located at 555 Theodore Fremd Avenue, Rye, New York, 10580. 8 RISK FACTORS Investing in our securities involves risks, including the risks described in this prospectus, in any prospectus supplement and in the other documents that are incorporated herein by reference. You should carefully consider the risks factors together with all of the other information and data included in this prospectus, any prospectus supplement and the documents that are incorporated herein by reference before you decide to acquire any securities. If any of the following risks actually occur, our business, financial condition or results of operation may suffer. RISKS RELATING TO JARDEN REDUCTIONS, CANCELLATIONS, OR DELAYS IN CUSTOMER PURCHASES WOULD ADVERSELY AFFECT OUR PROFITABILITY. Customers in our consumer products group, and many customers in our materials based group, generally do not enter into long-term contracts or commitments with us. As a result, these customers may cancel their orders, change purchase quantities from forecast volumes, or delay purchases for a number of reasons beyond our control. Significant or numerous cancellations, reductions, or delays in purchases by customers could have a material adverse effect on our business, results of operations and financial condition. In addition, because many of our costs are fixed, a reduction in customer demand could have an adverse affect on our gross profit margins and operating income. Sales to one customer in our consumer products group, Wal-Mart Stores, Inc. and its affiliates, accounted for approximately 8% of our 2001 consolidated net sales and approximately 17% of our 2001 consolidated net sales on a pro forma basis. In addition, sales to one customer in our materials based group accounted for approximately 8% of our 2001 consolidated net sales and approximately 6% of our 2001 consolidated net sales on a pro forma basis. A significant reduction in purchases from either of these customers could have a material adverse effect on our business, results of operations and financial condition. WE MAY BE ADVERSELY AFFECTED BY THE TREND TOWARDS RETAIL TRADE CONSOLIDATION. With the growing trend towards retail trade consolidation, we are increasingly dependent upon key retailers whose bargaining strength is growing. Our consumer products businesses may be negatively affected by changes in the policies of our retailer customers, such as inventory destocking, limitations on access to shelf space, price demands and other conditions. SALES OF SOME OF OUR PRODUCTS ARE SEASONAL AND WEATHER RELATED. Sales of certain of our products, particularly our consumer products, are seasonal. Sales of our home canning products generally reflect the pattern of the growing season, and sales of our FoodSaver (Registered Trademark) products generally are strongest in the fourth quarter preceding the holiday season. Sales of these products may be negatively impacted by unfavorable weather conditions and other market trends. Periods of drought, for example, may adversely affect the supply and price of fruit, vegetables, and other foods available for home canning. Sales of our consumer products may also be adversely affected by the trend toward decreasing prices and increasing quality of purchased preserved food products. Either or both of these factors could have a material adverse effect on our business, results of operations and financial condition. WE DEPEND ON SUPPLIERS IN ASIA. The vast majority of our FoodSaver (Registered Trademark) products are manufactured by third party suppliers in China and Korea. Any adverse change in, among other things, any of the following could have a material adverse effect on our business, results of operations and financial condition: o our relationship with these suppliers; o the financial condition of these suppliers; o our ability to import outsourced products; or 9 o these suppliers' ability to manufacture and deliver outsourced products on a timely basis. We cannot assure you that we could quickly or effectively replace any of our suppliers if the need arose, and we cannot assure you that we could retrieve tooling and molds possessed by any of our suppliers. Our dependence on these few suppliers could also adversely affect our ability to react quickly and effectively to changes in the market for our products. In addition, international manufacturing is subject to significant risks, including, among other things: o labor unrest; o political instability; o restrictions on transfer of funds; o domestic and international customs and tariffs; o unexpected changes in regulatory environments; and o potentially adverse tax consequences. Labor in China has historically been readily available at relatively low cost as compared to labor costs applicable in other nations. China has experienced rapid social, political and economic change in recent years. We cannot assure you that labor will continue to be available to us in China at costs consistent with historical levels. A substantial increase in labor costs in China could have a material adverse effect on our business, results of operations and financial condition. Although China currently enjoys "most favored nation" trading status with the United States, the U.S. government has in the past proposed to revoke such status and to impose higher tariffs on products imported from China. We cannot assure you that our business will not be affected by the aforementioned risks, each of which could have a material adverse effect on our business, results of operations and financial condition. COMPETITION IN OUR INDUSTRIES MAY HINDER OUR ABILITY TO EXECUTE OUR BUSINESS STRATEGY, ACHIEVE PROFITABILITY, OR MAINTAIN RELATIONSHIPS WITH EXISTING CUSTOMERS. We operate in highly competitive industries. We compete against numerous other domestic and foreign companies, many of which are more established in their industries and have substantially greater revenue or resources than we do. We also face competition from the manufacturing operations of our current and potential customers in our materials based group. A shift away from outsourcing on behalf of our current or potential customers could have a material adverse effect on our business, results of operations and financial condition. Competition could cause price reductions, reduced profits or losses, or loss of market share, any of which could have a material adverse effect on our business. To compete effectively in the future in the consumer products industry, among other things, we must: o maintain strict quality standards; o develop new products that appeal to consumers; and o deliver products on a reliable basis at competitive prices. To compete effectively in the future in the materials based industry, among other things, we must: o provide technologically advanced manufacturing services; o maintain strict quality standards; o respond flexibly and rapidly to customers' design and schedule changes; and o deliver products on a reliable basis at competitive prices. Our inability to do any of these things could have a material adverse effect on our business, results of operations and financial condition. 10 IF WE FAIL TO DEVELOP NEW OR EXPAND EXISTING CUSTOMER RELATIONSHIPS, OUR ABILITY TO GROW OUR BUSINESS WILL BE IMPAIRED. Growth in our consumer products and materials based groups depends to a significant degree upon our ability to develop new customer relationships and to expand existing relationships with current customers. We cannot guarantee that new customers will be found, that any such new relationships will be successful when they are in place, or that business with current customers will increase. Failure to develop and expand such relationships could have a material adverse effect on our business, results of operations and financial condition. WE CANNOT BE CERTAIN THAT OUR PRODUCT INNOVATIONS AND MARKETING SUCCESSES WILL CONTINUE. We believe that our future success will depend, in part, upon our ability to continue to introduce innovative designs in our existing products and to develop, manufacture and market new products. We cannot assure you that we will be successful in the introduction, marketing and manufacturing of any new products or product innovations, or develop and introduce in a timely manner innovations to our existing products which satisfy customer needs or achieve market acceptance. Our failure to develop new products and introduce them successfully and in a timely manner would harm our ability to grow our business and could have a material adverse effect on our business, results of operations and financial condition. WE MAY EXPERIENCE DIFFICULTY IN INTEGRATING ACQUIRED BUSINESSES, WHICH MAY INTERRUPT OUR BUSINESS OPERATIONS. We intend to grow through the acquisition of additional companies, including the proposed acquisition of the business assets of Diamond Brands. We expect to face competition for acquisition candidates, which may limit the number of opportunities and may lead to higher acquisition prices. There can be no assurance that we will be able to identify, acquire, or manage profitably additional businesses or to integrate successfully any acquired businesses into our existing business without substantial costs, delays or other operational or financial difficulties. Further, acquisitions involve a number of special risks, including failure of the acquired business to achieve expected results, diversion of management's attention, failure to retain key personnel of the acquired business and risks associated with unanticipated events or liabilities, some or all of which could have a material adverse effect on our business, results of operations and financial condition. OUR OPERATIONS ARE SUBJECT TO A NUMBER OF FEDERAL, STATE AND LOCAL ENVIRONMENTAL REGULATIONS. Our operations are subject to Federal, state and local environmental and health and safety laws and regulations including those that impose workplace standards and regulate the discharge of pollutants into the environment and establish standards for the handling, generation, emission, release, discharge, treatment, storage and disposal of materials and substances including solid and hazardous wastes. We believe that we are in material compliance with such laws and regulations and that the cost of maintaining compliance will not have a material adverse effect on our business, results of operations or financial condition. While we do not anticipate having to make, and historically have not had to make, significant capital expenditures in order to comply with applicable environmental laws and regulations, due to the nature of our operations and the frequently changing nature of environmental compliance standards and technology, we cannot predict with any certainty that future material capital expenditures will not be required. WE MAY BE ADVERSELY AFFECTED BY REMEDIATION OBLIGATIONS MANDATED BY APPLICABLE ENVIRONMENTAL LAWS. In addition to operational standards, environmental laws also impose obligations on various entities to clean up contaminated properties or to pay for the cost of such remediation, often upon parties that did not actually cause the contamination. Accordingly, we may become liable, either contractually or by operation of law, for remediation costs even if the contaminated property is not presently owned or operated by us, is a landfill or other location where we have disposed wastes, or if the contamination 11 was caused by third parties during or prior to our ownership or operation of the property. Given the nature of the past industrial operations conducted by us and others at these properties, there can be no assurance that all potential instances of soil or groundwater contamination have been identified, even for those properties where an environmental site assessment has been conducted. We do not believe that any of our existing remediation obligations, including at third-party sites where we have been named a potentially responsible party, will require material capital or operating expenditures or will otherwise have a material adverse effect upon our business, results of operations or financial condition. However, future events, such as changes in existing laws or policies or their enforcement, or the discovery of currently unknown contamination, may give rise to additional remediation liabilities that may be material. WE DEPEND UPON KEY PERSONNEL. We are highly dependent on the continuing efforts of our executive officers, including Martin E. Franklin, our Chairman and Chief Executive Officer, and Ian G.H. Ashken, our Vice Chairman and Chief Financial Officer, and we likely will depend on the senior management of any significant business we acquire in the future. Our business, results of operations and financial condition could be materially adversely affected by the loss of any of these persons and the inability to attract and retain qualified replacements. WE ENTER INTO CONTRACTS WITH THE UNITED STATES GOVERNMENT AND OTHER GOVERNMENTS. We have entered into a contract with the United States government to supply penny blanks to the United States Mint. We have also entered into a contract with the Canadian government to supply penny blanks to the Royal Canadian Mint. These contracts contain termination provisions customary for government contracts. The United States government and Canadian government retain the right to terminate these contracts at their convenience. These contracts are also subject to reduction or modification in the event of changes in government requirements or budgetary constraints. Our largest metals customer is the United States Mint, which comprised approximately 8% of our 2001 consolidated net sales (approximately 6% on a pro forma basis). The United States Mint announced in the fourth quarter of 2001 that it was implementing an inventory reduction program for all coinage. In addition, several times in recent years, proposed legislation has been introduced which, if passed, could reduce or eliminate the circulation of the penny. If production, use or demand for the U.S. penny is reduced, it could have a material adverse effect on our business, results of operations and financial condition. OUR OPERATING RESULTS CAN BE ADVERSELY AFFECTED BY CHANGES IN THE COST OR AVAILABILITY OF RAW MATERIALS. Pricing and availability of raw materials for use in our businesses can be volatile due to numerous factors beyond our control, including general, domestic and international economic conditions, labor costs, production levels, competition, import duties and tariffs and currency exchange rates. This volatility can significantly affect the availability and cost of raw materials for us, and may, therefore, have a material adverse effect on our business, results of operations and financial condition. During periods of rising prices of raw materials, there can be no assurance that we will be able to pass any portion of such increases on to customers. Conversely, when raw material prices decline, customer demands for lower prices could result in lower sale prices and, to the extent we have existing inventory, lower margins. As a result, fluctuations in raw material prices could have a material adverse effect on our business, results of operations and financial condition. Some of the products we manufacture require particular types of glass, plastic, metal or other materials. Supply shortages for a particular type of material can delay production or cause increases in the cost of manufacturing our products. This could have a material adverse effect on our business, results of operations and financial condition. OUR BUSINESS COULD BE ADVERSELY AFFECTED BECAUSE OF RISKS WHICH ARE PARTICULAR TO INTERNATIONAL OPERATIONS. On a pro forma basis, approximately 10.8% of Jarden's net sales in 2001 were derived from sales outside of the United States. In addition, we anticipate that international sales will be a growth area 12 for our consumer products business. International sales (and the international operations of our customers) are subject to inherent risks which could adversely affect us, including, among other things: o fluctuations in the value of currencies; o unexpected changes in and the burdens and costs of compliance with a variety of foreign laws; o political and economic instability; o increases in duties and taxation; and o reversal of the current policies (including favorable tax and lending policies) encouraging foreign investment or foreign trade by our host countries. OUR PERFORMANCE CAN FLUCTUATE WITH THE FINANCIAL CONDITION OF THE RETAIL INDUSTRY. We sell our consumer products to retailers, including food, hardware, catalog and mass merchants, in the United States and Canada. A significant deterioration in the financial condition of our major customers could have a material adverse effect on our sales and profitability. We continually monitor and evaluate the credit status of our customers and attempt to adjust sales terms as appropriate. Despite these efforts, a bankruptcy filing by a key customer could have a material adverse effect on our business, results of operations and financial condition. In addition, as a result of the desire of retailers to more closely manage inventory levels, there is a growing trend among retailers to make purchases on a "just-in-time" basis. This requires us to shorten our lead time for production in certain cases and more closely anticipate demand, which could in the future require the carrying of additional inventories. CLAIMS MADE AGAINST US BASED ON PRODUCT LIABILITY COULD HAVE A MATERIAL ADVERSE EFFECT ON OUR BUSINESS. As a producer and marketer of consumer products, we are subject to the risk of claims for product liability. We maintain product liability insurance, but there is a risk that our coverage will not be sufficient to insure against all claims which may be brought against us, or that we will not be able to maintain that coverage or obtain additional insurance covering existing or new products. If a product liability claim exceeding our insurance coverage were to be successfully asserted against us, it could have a material adverse effect on our business, results of operations and financial condition. WE DEPEND ON OUR PATENTS AND PROPRIETARY RIGHTS. Our success with our proprietary products depends, in part, on our ability to protect our current and future technologies and products and to defend our intellectual property rights. If we fail to adequately protect our intellectual property rights, competitors may manufacture and market products similar to ours. We cannot be sure that we will receive patents for any of our patent applications or that any existing or future patents that we receive or license will provide competitive advantages for our products. We also cannot be sure that competitors will not challenge, invalidate or avoid the application of any existing or future patents that we receive or license. In addition, patent rights may not prevent our competitors from developing, using or selling products that are similar or functionally equivalent to our products. Furthermore, the patents we maintain on the bags used for vacuum sealing expire in 2005 and the patents we maintain on our home vacuum packaging systems expire in 2009. We are currently applying for patents on new bags and vacuum packaging systems that we recently acquired. WE DEPEND ON A SINGLE MANUFACTURING FACILITY FOR CERTAIN ESSENTIAL PRODUCTS. Certain of our products, including some using specially designed machines and proprietary cutting technology, are manufactured at a sole company-owned manufacturing facility. These facilities are subject to the normal hazards that could result in material damage to such facilities. Damage to any of these facilities, or prolonged interruption in the operations of any of these facilities for repairs or other reasons, could have a material adverse effect on our business, results of operations and financial condition. 13 CERTAIN OF OUR EMPLOYEES ARE REPRESENTED BY LABOR UNIONS. Approximately 215 of our employees are covered by collective bargaining agreements. These agreements expire at our domestic consumables facility (Muncie, Indiana) on October 15, 2006 and at our metals facility (Greeneville, Tennessee) on October 4, 2003. While we have not experienced a work stoppage, slowdown or strike during the past five years and management believes that its relationships with our collective bargaining units are good, no assurance can be made that we will not experience a work stoppage, slowdown or strike in the future. A work stoppage, slowdown or strike by our employees, or the employees of our suppliers or customers, could have a material adverse effect on our business, results of operations and financial condition. OUR SIGNIFICANT INDEBTEDNESS COULD ADVERSELY AFFECT OUR FINANCIAL HEALTH, AND PREVENT US FROM FULFILLING OUR OBLIGATIONS UNDER OUR DEBT. We have a significant amount of indebtedness and will incur more debt if we close the proposed acquisition of Diamond Brands and/or complete a debt offering. Our significant indebtedness could: o make it more difficult for us to satisfy our obligations with respect to the debt securities; o increase our vulnerability to general adverse economic and industry conditions; o require us to dedicate a substantial portion of our cash flow from operations to payments on our indebtedness, thereby reducing the availability of our cash flow to fund working capital, capital expenditures, acquisitions and investments and other general corporate purposes; o limit our flexibility in planning for, or reacting to, changes in our business and the markets in which we operate; o place us at a competitive disadvantage compared to our competitors that have less debt; and o limit, among other things, our ability to borrow additional funds. The following table sets forth our total debt, total stockholders' equity, total capitalization and ratio of debt to total capitalization:
SEPTEMBER 30, 2002 ----------------------- (unaudited) (dollars in thousands) Total debt .................................... $ 217,290 Total stockholders' equity .................... 69,789 --------- Total capitalization .......................... $ 287,079 ========= Ratio of debt to total capitalization ......... 76%
The terms of our senior credit facility, the indenture that will govern the debt securities, and the indenture governing our 9 3/4% senior subordinated notes due 2012 allow us to issue and incur additional debt upon satisfaction of certain conditions. See "Description of Senior Indebtedness" for a description of our senior credit facility. If new debt is added to current debt levels, the related risks described above could increase. WE WILL REQUIRE A SIGNIFICANT AMOUNT OF CASH TO SERVICE OUR INDEBTEDNESS. OUR ABILITY TO GENERATE CASH DEPENDS ON MANY FACTORS BEYOND OUR CONTROL. Our ability to make payments on and to refinance our indebtedness, including the debt securities, our 9 3/4% senior subordinated notes due 2012, and amounts borrowed under our senior credit facility, and to fund planned capital expenditures and expansion efforts and strategic acquisitions we may make in the future, if any, will depend on our ability to generate cash in the future. This, to a certain extent, is subject to general economic, financial, competitive and other factors that are beyond our control. 14 Based on our current level of operations, we believe our cash flow from operations, together with available cash and available borrowings under our senior credit facility, will be adequate to meet future liquidity needs for at least the next twelve months. However, we cannot assure you that our business will generate sufficient cash flow from operations in the future, that our currently anticipated growth in revenues and cash flow will be realized on schedule or that future borrowings will be available to us under the senior credit facility in an amount sufficient to enable us to service indebtedness, including the debt securities, or to fund other liquidity needs. We may need to refinance all or a portion of our indebtedness, including the debt securities, our 9 3/4% senior subordinated notes due 2012, and our senior credit facility, on or before maturity. We cannot assure you that we will be able to do so on commercially reasonable terms or at all. THE INDENTURE RELATED TO THE DEBT SECURITIES, OUR 9 3/4% SENIOR SUBORDINATED NOTES DUE 2012, AND OUR SENIOR CREDIT FACILITY CONTAIN VARIOUS COVENANTS WHICH LIMIT OUR MANAGEMENT'S DISCRETION IN THE OPERATION OF OUR BUSINESS. Our senior credit facility, the indenture related to our 9 3/4% senior subordinated notes due 2012, and the indenture related to the debt securities contain various provisions that limit our management's discretion by restricting our and our subsidiaries' ability to, among other things: o incur additional indebtedness; o pay dividends or distributions on, or redeem or repurchase, capital stock; o make investments; o engage in transactions with affiliates; o incur liens; o transfer or sell assets; and o consolidate, merge or transfer all or substantially all of our assets. In addition, our senior credit facility requires us to meet certain financial ratios. Any failure to comply with the restrictions of our senior credit facility, the indenture related to our 9 3/4% senior subordinated notes due 2012, the indenture related to the debt securities or any other subsequent financing agreements may result in an event of default. An event of default may allow the creditors, if the agreements so provide, to accelerate the related debt as well as any other debt to which a cross-acceleration or cross-default provision applies. In addition, the lenders may be able to terminate any commitments they had made to supply us with further funds. WE MAY NOT HAVE THE ABILITY TO RAISE THE FUNDS NECESSARY TO FINANCE THE CHANGE OF CONTROL OFFER REQUIRED BY THE INDENTURE RELATED TO OUR 9 3/4% SENIOR SUBORDINATED NOTES DUE 2012. Upon the occurrence of certain specific kinds of change of control events, we will be required to offer to repurchase all outstanding notes under the indenture related to our 9 3/4% senior subordinated notes due 2012. However, it is possible that we will not have sufficient funds at the time of the change of control to make the required repurchase of these notes. In addition, restrictions in our senior credit facility prohibit repurchases of the notes unless a waiver is obtained from the lenders or our senior credit facility is repaid in full. If we fail to repurchase the notes following a change of control, we will be in default under the indenture related to the notes, which will result in a cross-default under our senior credit facility. Any future debt, including the debt securities, which we incur may also contain restrictions on repayment of the notes. In addition, certain important corporate events, such as leveraged recapitalizations, that would increase the level of our indebtedness would not constitute a change of control under the indenture related to the notes. RISKS RELATED TO OUR COMMON STOCK DELAWARE LAW AND OUR RIGHTS PLAN MAY LIMIT POSSIBLE TAKEOVERS. Our certificate of incorporation makes us subject to the anti-takeover provisions of Section 203 of the Delaware General Corporation Law. In general, Section 203 prohibits publicly-held Delaware 15 corporations to which it applies from engaging in a "business combination" with an "interested stockholder" for a period of three years after the date of the transaction in which the person became an interested stockholder, unless the business combination is approved in a prescribed manner. This provision could discourage others from bidding for our shares and could, as a result, reduce the likelihood of an increase in our stock price that would otherwise occur if a bidder sought to buy our stock. We have adopted a rights plan that provides that shares of our common stock have associated preferred stock purchase rights. These rights become exercisable and detachable from the associated common stock only on the tenth day following a public announcement that a person or group has acquired, or obtained the right to acquire, beneficial ownership of 15% or more of the outstanding shares of our common stock or on the tenth business day (or such later date as our board of directors will determine) following the commencement of a tender offer or exchange offer that would result in a person or group holding 15% or more of the outstanding shares of our common stock. The rights entitle our stockholders, other than the person or entity that has acquired or made an exchange or tender offer for 15% or more of our outstanding common stock, to purchase shares of our series A junior participating preferred stock or other capital stock and, in certain circumstances, would allow our stockholders to acquire capital stock in an entity that acquires our company. The exercise of these rights would make the acquisition of Jarden by a third party more expensive to that party and has the effect of discouraging third parties from acquiring our company without the approval of our board of directors, which has the power to redeem these rights and prevent their exercise. The preferred stock purchase rights are not presently exercisable and will expire at the close of business on March 22, 2003, unless earlier redeemed by us. THE MARKET PRICE FOR OUR COMMON STOCK IS VOLATILE. The market price for our common stock may be highly volatile. We believe that a variety of factors, including announcements by us or our competitors, quarterly variations in financial results, trading volume, general market trends and other factors, could use the market price of our common stock to fluctuate substantially. Additionally, the market in general, and our common stock in particular, may be subject to increased volatility due to general economic conditions and the terrorist attacks in New York and Washington, D.C. and any resulting conflicts. WE MAY ISSUE A SUBSTANTIAL AMOUNT OF OUR COMMON STOCK IN CONNECTION WITH FUTURE ACQUISITIONS AND THE SALE OF THOSE SHARES COULD ADVERSELY AFFECT OUR STOCK PRICE. As part of our growth strategy, we anticipate issuing additional shares of our common stock, preferred stock, and warrants. We may file other shelf registration statements with the Securities and Exchange Commission that we may use to sell shares of our common stock preferred stock, and warrants from time to time in connection with acquisitions. To the extent that we are able to grow through acquisitions for stock or warrants to purchase our stock, the number of outstanding shares of common stock and/or preferred stock that will be eligible for sale in the future is likely to increase substantially. Persons receiving warrants or shares of our common or preferred stock in connection with these acquisitions may be more likely to sell large quantities of their warrants and stock which may influence the price of our common stock. In addition, the potential issuance of additional shares in connection with anticipated acquisitions could lessen demand for our common stock and result in a lower price than would otherwise be obtained. OUR STOCK PRICE MAY BE ADVERSELY AFFECTED IF OUR STOCKHOLDERS SELL SUBSTANTIAL AMOUNTS OF OUR COMMON STOCK, OR OUR PREFERRED STOCK OR WARRANTS CONVERTIBLE INTO OUR COMMON STOCK, IN THE PUBLIC MARKET FOLLOWING THE OFFERING. If our stockholders sell substantial amounts of our common stock, or our preferred stock or warrants convertible into our common stock, in the public market following this offering, the market price of our common stock could fall. These sales might make it more difficult for us to sell equity or equity-related securities in the future at a time and price that we deem appropriate and may require 16 us to issue greater amounts of our common stock to finance such acquisition. Additional shares sold in this offering or to finance acquisitions may dilute our earnings per share if the new operations' earnings are disappointing. SINCE WE HAVE BROAD DISCRETION IN HOW WE USE THE NET PROCEEDS FROM THIS OFFERING, WE MAY USE SUCH PROCEEDS IN WAYS WITH WHICH YOU DISAGREE. We have not allocated specific amounts of the net proceeds from this offering to any specific purpose. While we expect to use a portion of the net proceeds from this offering to pay down our credit facility, our credit facility will permit us to re-borrow that money at later times. Accordingly, our management will have significant flexibility in applying the net proceeds of this offering. The failure of management to use such funds effectively could have a material adverse effect on our business, financial condition and operating results. RISKS RELATING TO THE DEBT SECURITIES YOUR RIGHT TO RECEIVE PAYMENTS ON THE DEBT SECURITIES IS JUNIOR TO OUR EXISTING SENIOR INDEBTEDNESS AND POSSIBLY ALL OF OUR FUTURE BORROWINGS. FURTHER, THE GUARANTEES OF THE DEBT SECURITIES ARE JUNIOR TO ALL OF THE GUARANTORS' EXISTING SENIOR INDEBTEDNESS AND POSSIBLY TO ALL THEIR FUTURE BORROWINGS. The debt securities and the guarantees rank behind all of our and the guarantors' existing senior indebtedness and all of our and the guarantors' future senior indebtedness. See "Description of Senior Indebtedness" for a description of our senior credit facility. As of September 30, 2002, the debt securities and the guarantees were subordinated to approximately $53 million of senior debt. In addition, our senior credit facility permitted up to approximately $46 million of additional borrowings, subject to compliance with the covenants and conditions to borrowing under the senior credit facility, which borrowings would be senior to the debt securities and the guarantees. We will be permitted to borrow substantial additional indebtedness, including senior debt, in the future. As a result of this subordination, upon any distribution to our creditors or the creditors of the guarantors in a bankruptcy, liquidation or reorganization or similar proceedings relating to us or the guarantors or our or the guarantors' property, the holders of our senior debt and the senior debt of the guarantors will be entitled to be paid in full in cash before any payment may be made with respect to the debt securities or the guarantees. In addition, all payments on the debt securities and the guarantees will be blocked in the event of a payment default on senior debt and may be blocked for up to 179 consecutive days in the event of certain non-payment defaults on designated senior debt. In the event of a bankruptcy, liquidation or reorganization or similar proceeding relating to us or the guarantors, the indenture relating to the debt securities will require that amounts otherwise payable to holders of the debt securities in a bankruptcy or similar proceeding be paid to holders of senior debt instead until the holders of senior debt are paid in full. As a result, holders of the debt securities may not receive all amounts owed to them and may receive less, ratably, than holders of trade payables and other unsubordinated indebtedness in any such proceeding. SINCE THE DEBT SECURITIES ARE UNSECURED, YOUR RIGHT TO ENFORCE REMEDIES IS LIMITED BY THE RIGHTS OF HOLDERS OF SECURED DEBT. In addition to being contractually subordinated to all existing and future senior indebtedness, our obligations under the debt securities will be unsecured while obligations under our senior credit facility will be secured by substantially all of our assets and those of our subsidiaries. If we become insolvent or are liquidated, or if payment under the senior credit facility is accelerated, the lenders under the senior credit facility are entitled to exercise the remedies available to a secured lender under applicable law. These lenders have a claim on all assets securing the senior credit facility before the holders of unsecured debt, including the debt securities. NOT ALL OF OUR SUBSIDIARIES WILL GUARANTEE OUR OBLIGATIONS UNDER THE DEBT SECURITIES, AND THE ASSETS OF THE NON-GUARANTOR SUBSIDIARIES MAY NOT BE AVAILABLE TO MAKE PAYMENTS ON THE DEBT SECURITIES. Our present and future domestic restricted subsidiaries will guarantee the debt securities. Payments on the debt securities are only required to be made by us and the subsidiary guarantors. As a result, no 17 payments are required to be made from assets of subsidiaries that do not guarantee the debt securities, unless those assets are transferred by dividend or otherwise to us or a subsidiary guarantor. On a pro forma basis, as of and for the year ended December 31, 2001, the aggregate total assets and net sales of our foreign subsidiaries, which represent all of our non-guarantor subsidiaries, were $14.3 million and $15.3 million, respectively, or 4.6% and 3.6%, respectively, of our total assets and net sales. In the event of a bankruptcy, liquidation or reorganization of any of the non-guarantor subsidiaries, holders of their liabilities, including their trade creditors, will be entitled to payment of their claims from the assets of those subsidiaries before any assets are made available for distribution to us. As a result, the debt securities are effectively subordinated to all indebtedness and other liabilities of the non-guarantor subsidiaries. A PUBLIC MARKET FOR THE DEBT SECURITIES MAY NOT DEVELOP. There can be no assurance that a public market for the debt securities will develop or, if such a market develops, as to the liquidity of the market. If a market were to develop, the debt securities could trade at prices that may be higher or lower than their principal amount. We do not intend to apply for listing of the debt securities on any securities exchange or for quotation of the debt securities on any automated quotation system. If an active public market does not develop or continue, the market price and liquidity of the debt securities may be adversely affected. In addition, the liquidity of the trading market in the debt securities, and the market price quoted for the debt securities, may be adversely affected by changes in the overall market for high-yield securities and by changes in our financial performance or prospects or in the prospects for companies in our industry generally. As a result, you cannot be sure that an active trading market will develop for the debt securities. FEDERAL AND STATE STATUTES ALLOW COURTS, UNDER SPECIFIC CIRCUMSTANCES, TO VOID GUARANTEES AND REQUIRE SECURITY HOLDERS TO RETURN PAYMENTS RECEIVED FROM GUARANTORS. If a bankruptcy case or lawsuit is initiated by unpaid creditors of any guarantor, the debt represented by the guarantees entered into by the guarantors may be reviewed under the Federal bankruptcy law and comparable provisions of state fraudulent transfer laws. Under these laws, a guarantee could be voided, or claims in respect of the guarantee could be subordinated to certain obligations of a guarantor if, among other things, the guarantor, at the time it entered into the guarantee: o received less than reasonably equivalent value or fair consideration for entering into the guarantee; and o either: o was insolvent or rendered insolvent by reason of entering into a guarantee; or o was engaged in a business or transaction for which the guarantor's remaining assets constituted unreasonably small capital; or o intended to incur, or believed that it would incur, debts or contingent liabilities beyond its ability to pay them as they become due. In addition, any payment by a guarantor could be voided and required to be returned to the guarantor or to a fund for the benefit of the guarantor's creditors under those circumstances. If a guarantee of a subsidiary were voided as a fraudulent conveyance or held unenforceable for any other reason, holders of the debt securities would be solely creditors of our company and creditors of our other subsidiaries that have validly guaranteed the debt securities. The debt securities then would be effectively subordinated to all liabilities of the subsidiary whose guarantee was voided. The measures of insolvency for purposes of these fraudulent transfer laws will vary depending upon the law applied in any proceeding to determine whether a fraudulent transfer has occurred. Generally, however, a guarantor would be considered insolvent if: 18 o the sum of its debts, including contingent liabilities, were greater than the fair saleable value of all of its assets; or o the present fair saleable value of its assets were less than the amount that would be required to pay its probable liability on its existing debts, including contingent liabilities, as they become absolute and mature; or o it could not pay its debts or contingent liabilities as they become due. If the claims of the holders of the debt securities against any subsidiary were subordinated in favor of other creditors of the subsidiary, the other creditors would be entitled to be paid in full before any payment could be made on the debt securities. If one or more of the guarantees is voided or subordinated, we cannot assure you that after providing for all prior claims there would be sufficient assets remaining to satisfy the claims of the holders of the debt securities. Based upon financial and other information, we believe that the guarantees are being incurred for proper proposes and in good faith and that we, and our subsidiaries that are guarantors, on a consolidated basis, are solvent and will continue to be solvent after this offering is completed, will have sufficient capital for carrying on our business after the issuance of the debt securities and will be able to pay our debts as they mature. We cannot assure you, however, as to the standard a court would apply in making these determinations or that a court would agree with our conclusions in this regard. 19 FORWARD LOOKING STATEMENTS Certain statements we make in this prospectus, and other written or oral statements by us or our authorized officers on our behalf, may constitute "forward looking statements" within the meaning of the Federal securities laws. Forward-looking statements include statements concerning our plans, objectives, goals, strategies, future events, future revenues or performance, capital expenditures, financing needs, plans or intentions relating to acquisitions, our competitive strengths and weaknesses, our business strategy and the trends we anticipate in the industry and economies in which we operate and other information that is not historical information. Words or phrases such as "estimates," "expects," "anticipates," "projects," "plans," "intends," "believes" and variations of such words or similar expressions are intended to identify forward-looking statements. All forward-looking statements, including, without limitation, our examination of historical operating trends, are based upon our current expectations and various assumptions. Our expectations, beliefs and projections are expressed in good faith, and we believe there is a reasonable basis for them, but we cannot assure you that our expectations, beliefs and projections will be realized. Before you invest in our common stock or debt securities, you should be aware that the occurrence of the events described in the immediately above section captioned "Risk Factors" and otherwise discussed elsewhere in this prospectus or in materials incorporated in this prospectus by reference to our other filings with the Commission, could have a material adverse affect on our business, financial condition and results of operation. The data included in this prospectus regarding markets and ranking, including the size of certain markets and our position and the position of our competitors within these markets, are based on independent industry publications, reports of government agencies or other published industry sources or our estimates based on management's knowledge and experience in the markets in which we operate. Our estimates have been based on information provided by customers, suppliers, trade and business organizations and other contacts in the markets in which we operate. We believe these estimates to be accurate as of the date of this prospectus. However, this information may prove to be inaccurate because of the method by which we obtained some of the data for our estimates or because this information cannot always be verified with complete certainty due to the limits on the availability and reliability of raw data, the voluntary nature of the data gathering process and other limitations and uncertainties inherent in a survey of market size. As a result, you should be aware that market, ranking and other similar data included in this prospectus, and estimates and beliefs based on that data, may not be reliable. 20 USE OF PROCEEDS Unless we indicate otherwise in the applicable prospectus supplement, we intend to use the net proceeds from the sale of the securities for general corporate purposes, which may include, but are not limited to, working capital, capital expenditures and other potential acquisitions, and to make certain required prepayments under our senior credit facility. See the section titled "Description of Senior Indebtedness" for a detailed description of required prepayments. We will set forth in the applicable prospectus supplement our intended use for the net proceeds received from our sale of any securities. RATIO OF EARNINGS TO FIXED CHARGES Our ratio of earnings to fixed charges for the five years ended December 31, 2001 and the nine months ended September 30, 2002 are set forth below:
--------------------------------------------------------------------------- FOR THE NINE MONTHS FOR THE YEAR ENDED DECEMBER 31, ENDED SEPTEMBER 30, --------------------------------------------------------------------------- 1997 1998 1999 2000 2001 2002 --------------------------------------------------------------------------- Ratio of earnings to fixed charges 10.5 12.4 6.2 1.5 * 4.6 ===========================================================================
* For the actual year ended December 31, 2001, the calculated ratio of earnings to fixed charges is less than one-to- one and represents a deficiency of approximately $125.6 million. The ratios of earnings to fixed charges are calculated as follows: (income before income taxes and minority interest) + (fixed charges) - (capitalized interest) ------------------------------------------------------- (fixed charges) 21 DESCRIPTION OF THE DEBT SECURITIES This prospectus describes certain general terms and provisions of our debt securities. When we offer to sell a particular series of debt securities, we will describe the specific terms of the series in a supplement to this prospectus. We will also indicate in the supplement whether the general terms and provisions described in this prospectus apply to a particular series of debt securities. The debt securities are to be issued under an indenture between us and a trustee, and may be supplemented or amended from time to time following its execution. The indenture, and any supplemental indentures, will be subject to, and governed by, the Trust Indenture Act of 1939, as amended (the "TIA"). The form of the indenture gives us broad authority to set the particular terms of each series of debt securities, including the right to modify certain of the terms contained in the indenture. The particular terms of a series of debt securities and the extent, if any, to which the particular terms of the issue modify the terms of the form of indenture will be described in the prospectus supplement relating to the debt securities. The statements made hereunder relating to the indenture and the debt securities to be issued thereunder are summaries of certain provisions thereof and do not purport to be complete and are subject to, and are qualified in their entirety by reference to, all provisions of the indenture (including those terms made a part of the indenture by reference to the TIA) and such debt securities. We have filed a copy of the indenture as an exhibit to the registration statement. Capitalized terms used in the summary below have the meanings specified in the indenture. GENERAL The terms of each series of debt securities will be detailed or determined in the manner provided in the indenture and any applicable supplemental indenture. The particular terms of each series of debt securities will be described in a prospectus supplement relating to the series, including any pricing supplement. We will set forth in a prospectus supplement (including any pricing supplement) relating to any series of debt securities being offered, the initial offering price, the aggregate principal amount and the following terms of the debt securities, if applicable: o the title of the debt securities; o any limit on the aggregate principal amount of the debt securities; o the date or dates on which we will pay the principal on the debt securities; o the rate or rates at which the debt securities will bear interest, the date or dates from which interest will accrue, the date or dates on which interest will be payable and any regular record date for the interest payable on any interest payment date; o the place or places where principal of and any premium and interest on the debt securities will be payable; o whether the debt securities rank as senior subordinated debt securities or subordinated debt securities; o the terms of any guarantee of any debt securities; o the terms and conditions upon which we may redeem the debt securities; o any obligation we have to redeem or purchase the debt securities pursuant to any sinking fund or analogous provisions or at the option of a holder of debt securities; o the denominations in which the debt securities will be issued, if other than denominations of $1,000 and any integral multiple thereof; o whether the debt securities will be issued in the form of certificated debt securities or global debt securities; 22 o the portion of principal amount of the debt securities payable upon declaration of acceleration of the maturity date, if other than the principal amount; o the currency, currencies, or currency units in which payment of the principal of and any premium and interest debt securities will be made; o if payments of principal of or any premium and interest on the debt securities will be made in one or more currencies or currency units other than that or those in which the debt securities are stated to be payable, the currency, currencies, or currency units in which payment of principal of or any premium and interest on the debt securities as to which such election is made will be payable, and the periods within which and the terms and conditions upon which such election is to be made; o the manner in which the amounts of payment of principal of or any premium or interest on the debt securities will be determined, if these amounts may be determined by reference to an index, based upon a formula, or in some other manner; o whether, the ratio at which and the terms and conditions upon which, if any, the debt securities will be convertible into or exchangeable for our common stock or our other securities or securities of another person; o any addition to or change in the events of default described in this prospectus or in the indenture with respect to the debt securities and any change in the acceleration provisions described in this prospectus or in the indenture with respect to the debt securities; o any addition to or change in the covenants described in this prospectus or in the indenture with respect to the debt securities; and o any other terms of the debt securities, which may modify or delete any provision of the indenture as it applies to that series. TRANSFER AND EXCHANGE A holder will be able to transfer or exchange debt securities in accordance with the indenture. The registrar and the trustee may require a holder, among other things, to furnish appropriate endorsements and transfer documents in connection with a transfer of debt securities. Holders may be required to pay all taxes due on transfer. EVENTS OF DEFAULT AND REMEDIES An event of default means with respect to any series of debt securities, any of the following: o default in the payment of any interest upon any debt security of that series when it becomes due and payable, and continuance of that default for a period of 30 days; o default in the payment of the principal of or premium, if any, on any debt security of that series when it becomes due and payable; o default in the making of any sinking fund payment when and as due in respect of any debt security of that series; o default in the performance, or breach, of any other material covenant or warranty by us in the indenture (other than a default in the performance, or breach, of a covenant or agreement that is specifically dealt elsewhere in the indenture or that has been included in the indenture solely for the benefit of a series of debt securities other than that series), which default continues uncured for a period of 60 days after we receive written notice from the trustee or we and the trustee receive written notice from the holders of not less than a certain specified percentage in aggregate principal amount of the then outstanding debt securities of that series as provided in the indenture; 23 o any nonpayment or other default is made under any agreement or instrument relating to any of our other indebtedness and such default shall have continued after any applicable grace period and results in that indebtedness becoming due prior to its stated maturity or occurs at the final maturity of that indebtedness; o certain events of bankruptcy, insolvency or reorganization; and o any other event of default provided with respect to debt securities of that series that is described in the applicable prospectus supplement accompanying this prospectus. No event of default with respect to a particular series of debt securities (except as to certain events of bankruptcy, insolvency or reorganization) necessarily constitutes an event of default with respect to any other series of debt securities. If an event of default with respect to debt securities of any series at the time outstanding occurs and is continuing, then the trustee or the holders of not less than a certain specified percentage in aggregate principal amount of the then outstanding debt securities of that series may, by written notice to us (and to the trustee if given by the holders), declare to be due and payable immediately the principal (or, if the debt securities of that series are discount securities, that portion of the principal amount as may be specified in the terms of that series) of all debt securities of that series. In the case of an event of default resulting from certain events of bankruptcy, insolvency or reorganization, the principal of and premium, if any, and interest of all outstanding debt securities will become and be immediately due and payable without any declaration or other act by the trustee or any holder of outstanding debt securities. At any time after a declaration of acceleration with respect to debt securities of any series has been made, but before the trustee has obtained a judgment or decree for payment of the money due, the holders of a majority in aggregate principal amount of the then outstanding debt securities of that series may, subject to our having paid or deposited with the trustee a sum sufficient to pay overdue interest and principal which has become due other than by acceleration and certain other conditions, rescind and annul such acceleration if all events of default, other than the nonpayment of accelerated principal and premium with respect to debt securities of that series, have been cured or waived as provided in the indenture. For information as to waiver of defaults see the discussion under "--Amendment, Supplement and Waiver" below. We refer you to the prospectus supplement relating to any series of debt securities that are discount securities for the particular provisions relating to acceleration of a portion of the principal amount of the discount securities upon the occurrence of an event of default and the continuation of an event of default. The indenture provides that the trustee will be under no obligation to exercise any of its rights or powers under the indenture at the request of any holder of outstanding debt securities, unless the trustee receives indemnity satisfactory to it against any cost, liability or expense. Subject to certain rights of the trustee, the holders of a majority in aggregate principal amount of the then outstanding debt securities of any series shall have the right to direct the time, method and place of conducting any proceeding for any remedy available to the trustee or exercising any trust or power conferred on the trustee with respect to the debt securities of that series. The indenture provides that the trustee may withhold notice to the holders of debt securities of any series of any event of default (except in payment on any debt securities of that series) with respect to debt securities of that series if it in good faith determines that withholding notice is in the interest of the holders of those debt securities. AMENDMENT, SUPPLEMENT AND WAIVER Without notice to or the consent of any holders, we and the trustee enter into one or more supplemental indentures for any of the following purposes: o to evidence the succession of another entity to us and the assumption by that successor of our covenants in the indenture and in the debt securities; 24 o to add to the covenants for the benefit of the holders of all or any series of debt securities, and if those covenants are to be for the benefit of less than all series, stating that those covenants are expressly being included solely for the benefit of that series, or to surrender any right or power conferred upon us; o to add any additional events of default; o to add or change any of the provisions of the indenture to such extent as may be necessary to permit or facilitate the issuance of debt securities in bearer form, registrable or not registrable as to principal, and with or without interest coupons, or to permit or facilitate the issuance of Securities in uncertificated form o subject to certain limitations, to add to, change, or eliminate any of the provisions of the indenture in respect of any series of debt securities; o to establish the form or terms of debt securities of any series as permitted by the indenture; o to evidence and provide for the acceptance of appointment of a separate or successor trustee with respect to one or more series of debt securities and to add to or change any of the provisions of the indenture as is necessary to provide for or facilitate the administration of the trusts thereunder by more than one trustee; or o to cure any ambiguity, to correct or supplement any provision in the indenture which may be defective or inconsistent with any other provision in the indenture, or to make any other provisions with respect to matters or questions arising under the indenture, provided that such action does not adversely affect the interests of the holders of the debt securities of any series in any material respect. We and the trustee may, with some exceptions, amend or modify any indenture with the consent of the holders of at least a majority in aggregate principal amount of the outstanding debt securities of all series affected by the amendment or modification. However, no amendment or modification may, without the consent of the holder of each outstanding debt security affected thereby: o change the stated maturity of the principal of, or any installment of principal of or interest on, any debt security, or reduce the principal amount thereof or the rate of interest thereon or any premium payable upon the redemption thereof, or reduce the amount of the principal of an original issue discount security that would be due and payable upon a declaration of acceleration of maturity, or change the coin or currency in which any premium or interest on any debt security is payable, or impair the right to institute suit for the enforcement of any payment on or after the stated maturity (or, in the case of redemption, on or after the redemption date); o reduce the percentages of holders whose consent is required for any modification or waiver; or o modify certain of the provisions in the indenture relating to supplemental indentures and waivers of certain covenants and past defaults. A modification which changes or eliminates any provision of an indenture expressly included solely for the benefit of holders of debt securities of one or more particular series or modifies the holders' rights will be deemed not to affect the rights under the indenture of the registered holders of debt securities of any other series. The indenture provides that the holders of a majority in principal amount of the outstanding debt securities of any series may on behalf of the holders of all of the debt securities of that series waive any past default and its consequences with respect to that series, except: o a default in the payment of interest on or premium, if any, or the principal of, any debt security of that series; or o a default in respect of a covenant or provision of the indenture which cannot be modified or amended without the consent of the holder of each outstanding debt security of that series affected. 25 DEFEASANCE OF INDENTURE Legal Defeasance The indenture provides that, unless otherwise provided by the terms of the applicable series of debt securities, we may be discharged from any and all obligations in respect of the debt securities of any series (except for certain obligations to register the transfer or exchange of debt securities of the series, to replace stolen, lost or mutilated debt securities of the series, and to maintain paying agencies and certain provisions relating to the treatment of funds held by paying agents). Covenant Defeasance The indenture provides that, unless otherwise provided by the terms of the applicable series of debt securities, upon compliance with certain conditions we may omit to comply with certain covenants contained in the indenture, as well as additional covenants contained in a supplement to the indenture and that certain events of default under the indenture will not constitute a an event of default with respect to the debt securities of that series. In the case of either legal defeasance or covenant defeasance, we will be so discharged upon the deposit with the trustee, in trust, of money and/or U.S. Government Obligations that, through the payment of interest and principal in accordance with their terms, will provide money in an amount sufficient in the opinion of a nationally recognized firm of independent public accountants to pay and discharge the principal of and premium and interest on the debt securities of that series on the stated maturity of such payments in accordance with the terms of the indenture and those debt securities. This discharge may occur only if, among other things, we have delivered to the trustee an officers' certificate and an opinion of counsel stating that we have received from, or there has been published by, the United States Internal Revenue Service a ruling or, since the date of execution of the indenture, there has been a change in the applicable United States federal income tax law, in either case to the effect that holders of the debt securities of such series will not recognize income, gain or loss for United States federal income tax purposes as a result of the deposit, defeasance and discharge and will be subject to United States federal income tax on the same amount and in the same manner and at the same times as would have been the case if the deposit, defeasance and discharge had not occurred. CONSOLIDATION, MERGER, SALE OR TRANSFER We may not consolidate with or merge with or into any other person or transfer all or substantially all of our properties and assets to any person unless, among other things: o either: o we are the surviving or continuing corporation; or o the person (if other than us) formed by such consolidation or into which we are merged or the person which all or substantially all of our properties and assets are transferred is a corporation duly organized and validly existing under the laws of the United States, any state thereof or the District of Columbia and expressly assumes, by a supplemental indenture all of our obligations under the debt securities and the indenture; and o immediately after the transaction and the incurrence or anticipated incurrence of any indebtedness to be incurred in connection with the transaction, no default will exist. 26 DESCRIPTION OF CAPITAL STOCK COMMON STOCK The holders of our common stock, par value $0.01 per share, are entitled to one vote for each share on all matters voted on by our stockholders, including the election of directors. No holders of common stock have any right to cumulative voting. Subject to any preferential rights of any outstanding series of preferred stock created by our board of directors, the holders of our common stock will be entitled to such dividends as may be declared from time to time by our board of directors from funds available therefor. We currently do not and do not intend to pay cash dividends on our common stock in the foreseeable future, and, at this time, are restricted from doing so under the terms of our credit facility. In the event of a liquidation, dissolution or winding up, the holders of our common stock are entitled to share ratably in all assets remaining after payment of liabilities and the liquidation preference and other amounts owed to the holders of our preferred stock. Holders of common stock have no preemptive rights or rights to convert their common stock into any other securities. There are no redemption or sinking fund provisions applicable to the common stock. Subject to adjustment and certain limitations, each share of common stock has a preferred stock purchase right that entitles the registered holder of the common stock to purchase from us a unit consisting of one one-hundredth of a share of our series A junior participating preferred stock, at an exercise price of $45.00 per Right upon the happening of certain events. The preferred stock purchase rights are not presently exercisable and will expire at the close of business on March 22, 2003, unless earlier redeemed by us. Our common stock is listed on the New York Stock Exchange under the symbol "JAH." PREFERRED STOCK Our restated certificate of incorporation, as amended, authorizes our board of directors to issue, without further stockholder action, up to 5,000,000 shares of preferred stock, in one or more series, having a par value of $.01 per share, 250,000 of which has been designated as Series A Junior Participating Preferred Stock. The board of directors is authorized to fix for each such series the designation and relative rights (including, if any, conversion, participation, voting and dividend rights and stated redemption and liquidation values), preferences, limitations and restrictions, as are stated in the resolutions adopted by the board of directors and as are permitted by General Corporation Law of the State of Delaware. One right to purchase one one-hundredth of a share of Series A Junior Participating Preferred Stock is attached to each outstanding share of our common stock. DESCRIPTION OF WARRANTS We may issue warrants to purchase debt securities, shares of preferred stock, or shares or common stock. We may issue warrants independently or together with any other securities we offer pursuant to a prospectus supplement and the warrants may be attached to or separate from the securities. We will issue each series of warrants under a separate warrant agreement that we will enter into with a bank or trust company, as warrant agent. We will set forth additional terms of the warrants and the applicable warrant agreements in the applicable prospectus supplement. Each warrant will entitle the holder to purchase the principal amount of debt securities or the number of shares of preferred stock or common stock at the exercise price set forth in, or calculable as set forth in, the applicable prospectus supplement. The exercise price may be subject to adjustment upon the occurrence of certain events, as set forth in the applicable prospectus supplement. After the close of business on the expiration date of the warrant, unexercised warrants will become void. The place or places where, and the manner in which, warrants may be exercised shall be specified in the applicable prospectus supplement. 27 The applicable prospectus supplement will describe the following terms, where applicable, of the warrants in respect of which this prospectus is being delivered: o the title of the warrants; o the aggregate number of the warrants; o the price or prices at which the warrants will be issued; o the designation, aggregate principal amount and terms of the securities issuable upon exercise of the warrants and the procedures and conditions relating to the exercise of the warrants; o the designation and terms of any related securities with which the warrants will be issued, and the number of warrants that will be issued with each security; o the date, if any, on and after which the warrants and the related debt securities will be separately transferable; o the price at which the securities purchasable upon exercise of the warrants may be purchased; o the date on which the right to exercise the warrants will commence, and the date on which the right will expire; o the maximum or minimum number of warrants which may be exercised at any time; o a discussion of certain U.S. federal income tax considerations applicable to the exercise of the warrants; and o any other terms of the warrants and terms, procedures and limitations relating to the exercise of the warrants. Holders may exchange warrant certificates for new warrant certificates of different denominations, and may exercise warrants at the corporate trust office of the warrant agent or any other office indicated in the applicable prospectus supplement. Prior to the exercise of their warrants, holders of warrants will not have any of the rights of holders of the securities purchasable upon the exercise and will not be entitled to payments of principal, premium or interest on the securities purchasable upon the exercise. DESCRIPTION OF SENIOR INDEBTEDNESS On April 24, 2002, we refinanced our existing senior indebtedness with a new $100 million senior secured credit facility (the "Credit Facility") pursuant to the terms of a Credit Agreement (the "Credit Agreement"), with Bank of America, N.A., as Administrative Agent (the "Administrative Agent"), Swing Line Lender, and L/C Issuer, Canadian Imperial Bank of Commerce, as Syndication Agent, National City Bank of Indiana, as Documentation Agent, and the other Lenders party thereto, including The Bank of New York, Fleet National Bank, Harris Trust and Savings Bank, U.S. Bank National Association, Allfirst Bank, Transamerica Business Capital Corporation, and Union Federal Bank of Indianapolis. The Credit Agreement, among other things, provides for a new senior credit facility for up to $100 million of senior secured loans, consisting of a $50 million five-year revolving credit facility (the "Revolving Credit Facility") and a $50 million five-year term loan facility (the "Term Loan Facility"). The Revolving Credit Facility includes up to an aggregate of $10 million in standby and commercial letters of credit and up to an aggregate of $10 million in swing line loans. As of June 30, 2002, we had not drawn any of the $50 million available under the Revolving Credit Facility, although we used $2.6 million of availability in connection with pre-existing letters of credit. The Term Loan Facility was drawn in full, in the amount of $50 million, at the closing of the Credit Facility and $48.75 million was outstanding as of September 30, 2002 reflecting scheduled principal repayment since issuance. Principal and interest under the Term Loan Facility are payable quarterly, in accordance with a specified amortization schedule, with the final payment of all amounts outstanding thereunder being due on April 24, 2007. 28 The Revolving Credit Facility and the Term Loan Facility bear interest at a rate equal to (i) the Eurodollar Rate (as determined by the Administrative Agent) pursuant to an agreed formula or (ii) a Base Rate equal to the higher of (a) the Bank of America prime rate and (b) the federal funds rate plus .50%, plus, in each case, an applicable margin ranging from .75% to 1.50% for Base Rate loans and from 2.00% to 2.75% for Eurodollar Rate loans. The Credit Agreement contains certain restrictions on the conduct of our business, including, among other things, restrictions, generally, on: o incurring debt, including any debt issued in connection with this offering; o disposing of certain assets; o making investments; o exceeding certain agreed capital expenditures; o creating or suffering liens on our assets; o completing certain mergers, consolidations, and with permitted exceptions, acquisitions; o declaring dividends; o redeeming or prepaying other debt; and o transactions with affiliates. The Credit Agreement also requires us to maintain the following financial covenants: o our consolidated net worth may not be at any time less than the sum of: o $30,000,000; o an amount equal to 50% of our consolidated net income earned in each fiscal quarter ending after December 31, 2001 (with no deduction for a net loss in any such fiscal quarter); and o an amount equal to 100% of the aggregate increases in the stockholders' equity of Jarden and our subsidiaries after April 24, 2002 by reason of the issuance and sale of our capital stock (including upon any conversion of our debt securities into our capital stock); o our total leverage ratio as of the end of any four-quarter period may not be greater than the ratio set forth below opposite such four-quarter period: Four-Quarter Period ending closest to: Maximum Total Leverage Ratio - -------------------------------------------- ----------------------------- September 30, 2002; December 31, 2002; March 31, 2003; 3.50 to 1.00 June 30, 2003; and September 30, 2003 December 31, 2003; March 31, 2004; June 30, 2004; and 3.25 to 1.00 September 30, 2004 December 31, 2004 and thereafter 3.00 to 1.00
o our senior leverage ratio as of the end of any four-quarter period may not be greater than the ratio set forth below opposite such four-quarter period: 29 Four-Quarter Period ending closest to: Maximum Senior Leverage Ratio - --------------------------------------------- ------------------------------ September 30, 2002; December 31, 2002; and 2.00 to 1.00 March 31, 2003 June 30, 2003; September 30, 2003; December 31, 2003; 1.75 to 1.00 March 31, 2004; June 30, 2004; and September 30, 2004 December 31, 2004 and thereafter 1.50 to 1.00 ; and
o our fixed charge ratio as of the end of any applicable period, beginning with the period ending closest to September 30, 2002, may not be less than 1.25 to 1.00. However, the Credit Agreement does not make any significant restrictions on our or our domestic subsidiaries' ability to obtain funds from their respective subsidiaries by dividend or loan. The occurrence of certain events or conditions described in the Credit Agreement (subject to grace periods in certain cases) constitutes an event of default. If an event of default occurs, the Administrative Agent may, at the request or consent of the Lenders, among other things, declare the entire outstanding balance of principal and interest of all outstanding loans to be immediately due and payable. The events of default include, among other things: o our failure to pay any principal, interest, or other fees when due; o any material judgment or order entered against us; o any inaccuracy in the representations and warranties; o failure to observe certain covenants under the Credit Agreement (including, e.g., the financial covenants); o bankruptcy, insolvency or receivership proceedings with respect to Jarden; and o a change of control of Jarden. The Credit Agreement provides that we shall make required prepayments of the Term Loan and Revolving Loan, including, among other things, upon the happening of the following events: o in the event that our total leverage ratio is greater than 3.00 to 1.00 as of the end of any fiscal year, beginning with the fiscal year ending December 31, 2002, we must make a prepayment in an amount equal to fifty percent (50%) of the amount of excess cash flow, each such prepayment to be made on the date our and our subsidiaries' financial statements for such fiscal year are required to be delivered (or if earlier, the date such financial statements are delivered) pursuant to the Credit Agreement; o we must make, or must cause each applicable subsidiary to make, a prepayment with respect to each private or public offering of equity securities of Jarden or any of our subsidiaries (other than equity securities issued to Jarden or a guarantor) in an amount equal to fifty percent (50%) of the net proceeds of each issuance of equity securities of the Jarden or any of our subsidiaries, each such prepayment to be made within ten (10) business days of receipt of such proceeds and upon not less than five (5) business days' prior written notice to the Administrative Agent; however, no prepayment shall be required of the first $10,000,000 of net proceeds in each fiscal 30 year of Jarden realized from (x) the issuance of equity securities in connection with the exercise of any option, warrant or other convertible security of Jarden or any of our subsidiaries or (y) the issuance, award or grant of equity securities to eligible participants under a stock plan of Jarden. o we must make, or must cause each applicable subsidiary to make, a prepayment in an amount equal to one hundred percent (100%) of the net proceeds from each Disposition (as defined below) other than certain Permitted Dispositions (as defined below), each such prepayment to be made within ten (10) business days of receipt of the net proceeds thereof and upon not less than five (5) business days' prior written notice to the Administrative Agent. Disposition means the sale, transfer, license or other disposition (including any sale and leaseback transaction) of any property by any person, including any sale, assignment, transfer or other disposal, with or without recourse, of any notes or accounts receivable or any rights and claims associated therewith. A Disposition shall not include (a "Permitted Disposition"): o Dispositions of obsolete or worn out property, whether now owned or hereafter acquired, in the ordinary course of business; o Dispositions of inventory in the ordinary course of business; o Dispositions by Jarden or any of our subsidiaries of equipment or real property which is replaced by equipment or real property of substantially equivalent or greater utility and value within ninety (90) days of the date of disposition thereof, provided that if the fair market value of the property so disposed of is greater than $3,000,000, the Administrative Agent will have received notice of such disposition from us not less than twenty (20) days prior to the consummation of such disposition; o Dispositions of property (i) by any of our subsidiaries to a guarantor, (ii) by us or any guarantor to any guarantor, and (iii) by any of our subsidiaries that is not a guarantor to any other of our subsidiaries that is not a guarantor; o any of our subsidiaries may merge with or transfer substantially all its assets (upon voluntary liquidation or otherwise) to any guarantor, provided that, if a merger, the guarantor must be the continuing or surviving person, and provided further that if a transfer of assets in the form of a sale by a subsidiary that is not a guarantor, the sale shall be at fair market value and the aggregate amount of all such sales will not exceed $5,000,000; o any of our subsidiaries substantially all of whose assets consist of other subsidiaries' securities or other equity securities in any person may merge with or transfer substantially all its assets (upon voluntary liquidation or otherwise) to us, provided that, if a merger, we will be the continuing or surviving person, and provided further that if a transfer of assets in the form of a sale by a subsidiary that is not a guarantor, the sale will be at fair market value and the aggregate amount of all such sales will not exceed $5,000,000; o any of our subsidiaries that is not a guarantor may merge with or sell substantially all its assets (upon voluntary liquidation or otherwise) to any one or more subsidiaries that is not a guarantor; and o Dispositions not otherwise permitted by above, so long as the aggregate fair market value of all such property so disposed in any fiscal year of Jarden does not exceed $35,000,000 and the net proceeds therefrom are applied in accordance with the Credit Agreement; o In the event that the net proceeds received from insurance carried with respect to the collateral securing our obligations under the Credit Agreement and the other loan documents is not completely and fully utilized for the repair or replacement of such collateral, we must make, or must cause each applicable subsidiary to make, a prepayment in an amount equal to one hundred percent (100%) of the net proceeds received with respect to such insurance that is not so utilized. 31 In connection with entering into the Credit Agreement, all of our domestic subsidiaries, including Hearthmark, Inc., Alltrista Plastics Corporation, Alltrista Newco Corporation, Alltrista Zinc Products, L.P., TriEnda Corporation, Tilia, Inc. (formerly known as Alltrista Acquisition I, Inc.), Tilia Direct, Inc. (formerly known as Alltrista Acquisition II, Inc.), and Tilia International, Inc. (formerly known as Alltrista Acquisition III, Inc.), and Quoin Corporation, have agreed to guarantee our obligations under the Credit Agreement. Pursuant to a securities pledge agreement, all obligations under the Credit Agreement are secured by a security interest in all of the capital stock or other equity interests of each of our existing or future direct or indirect domestic subsidiaries, and 65% of the voting capital stock or other equity interests and 100% of the nonvoting stock or other equity interests of each of our (or any of our direct or indirect domestic subsidiaries') existing or future direct foreign subsidiaries. Pursuant to the terms of a security agreement and an intellectual property security agreement, the obligations under the Credit Agreement are also secured by a security interest in substantially all of the assets and properties of us and our domestic subsidiaries. The foregoing is a summary of the material provisions of the Credit Agreement and certain of the documents entered into by us and our domestic subsidiaries in connection therewith which are incorporated herein by reference. PLAN OF DISTRIBUTION We may sell securities to or through underwriters and also may sell securities directly to purchasers or through agents. We will name any underwriter or agent involved in the offer and sale of securities in the applicable prospectus supplement. We may distribute the securities from time to time in one or more transactions: o at a fixed price or prices, which may be changed; o at market prices prevailing at the time of sale; o at prices related to such prevailing market prices; or o at negotiated prices. We may also, from time to time, authorize dealers, acting as our agents, to offer and sell securities upon the terms and conditions set forth in the applicable prospectus supplement. In connection with the sale of securities, we, or the purchasers of securities for whom the underwriters may act as agents, may compensate underwriters in the form of discounts, concessions or commissions. Underwriters may sell the securities to or through dealers, and those dealers may receive compensation in the form of discounts, concessions or commissions from the underwriters and/or commissions from the purchasers for whom they may act as agent. Underwriters, dealers and agents participating in the distribution of securities may be deemed to be underwriters under the Securities Act, and any discounts or commissions they receive from us and any profit they realize on resale of the securities may be deemed to be underwriting discounts and commissions under the Securities Act. We will describe in the applicable prospectus supplement any compensation we pay to underwriters or agents in connection with the offering of securities, and any discounts, concessions or commissions allowed by underwriters to participating dealers. We may enter into agreements to indemnify underwriters, dealers and agents who participate in the distribution of securities against certain liabilities, including liabilities under the Securities Act. To facilitate the offering of securities, certain persons participating in the offering may engage in transactions that stabilize, maintain or otherwise affect the price of the securities. This may include over-allotments or short sales of the securities, which involve the sale by persons participating in the offering of more securities than we sold to them. In these circumstances, these persons would cover such over-allotments or short positions by making purchases in the open market or by exercising their over-allotment option, if any. In addition, these persons may stabilize or maintain the price of the securities by bidding for or purchasing securities in the open market or by imposing penalty bids, 32 whereby selling concessions allowed to dealers participating in the offering may be reclaimed if securities sold by them are repurchased in connection with stabilization transactions. The effect of these transactions may be to stabilize or maintain the market price of the securities at a level above that which might otherwise prevail in the open market. These transactions may be discontinued at any time. Certain of the underwriters, dealers or agents and their associates may engage in transactions with and perform services for us in the ordinary course of our business. WHERE YOU CAN FIND MORE INFORMATION We are subject to the informational requirements of the Exchange Act, and in accordance therewith we are required to file periodic reports, proxy statements and other information with the Commission. Such reports, proxy statements and other information filed by us can be inspected and copied at the public reference facilities maintained by the Commission at 450 Fifth Street, N.W., Room 1024, Washington, D.C. 20549, as well as the Regional Offices of the Commission at Citicorp Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661, at the prescribed rates. The Commission also maintains a site on the World Wide Web that contains reports, proxy and information statements and other information regarding registrants that file electronically. The address of such site is http://www.sec.gov. The telephone number of the Public Reference Room of the Commission is 1-800-SEC-0330. In addition, similar information can be inspected at the New York Stock Exchange, 20 Broad Street, New York, New York 10005. With respect to the common stock, preferred stock, warrants, and debt securities, this prospectus omits certain information that is contained in the registration statement on file with the Commission, of which this prospectus is a part. For further information with respect to us and our common stock, preferred stock, warrants, and debt securities, reference is made to the registration statement, including the exhibits incorporated therein by reference or filed therewith. Statements herein contained concerning the provisions of any document are not necessarily complete and, in each instance, reference is made to the copy of such document filed as an exhibit or incorporated by reference to the registration statement. The registration statement and the exhibits may be inspected without charge at the offices of the Commission or copies thereof obtained at prescribed rates from the public reference section of the Commission at the addresses set forth above. You should rely on the information contained in this prospectus and in the registration statement as well as other information you deem relevant. We have not authorized anyone to provide you with information different from that contained in this prospectus. This prospectus is an offer to sell, or a solicitation of offers to buy, securities only in jurisdictions where offers and sales are permitted. The information contained in this prospectus is accurate only as of the date of this prospectus, regardless of the time of delivery of this prospectus or any sale or exchange of securities, however, we have a duty to update that information while this prospectus is in use by you where, among other things, any facts or circumstances arise which, individually or in the aggregate, represent a fundamental change in the information contained in this prospectus or any material information with respect to the plan of distribution was not previously disclosed in the prospectus or there is any material change to such information in the prospectus. This prospectus does not offer to sell or solicit any offer to buy any securities other than the common stock, preferred stock, warrants, and debt securities to which it relates, nor does it offer to buy any of these securities in any jurisdiction to any person to whom it is unlawful to make such offer or solicitation in such jurisdiction. EXPERTS The consolidated financial statements of Jarden Corporation and subsidiaries (formerly Alltrista Corporation and subsidiaries) appearing in its Annual Report (Form 10-K/A) for the year ended December 31, 2001, have been audited by Ernst & Young LLP, independent auditors, as set forth in their report thereon included therein and incorporated herein by reference. Such consolidated financial statements are incorporated herein by reference in reliance upon such report given on the authority of such firm as experts in accounting and auditing. 33 The consolidated financial statements of Tilia International, Inc. and its subsidiaries 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 report with respect thereto. Arthur Andersen LLP has not consented to the inclusion of their report in this prospectus, and we have dispensed with the requirement to file their consent in reliance upon Rule 437a of the Securities Act of 1933. Because Arthur Andersen LLP has not consented to the inclusion of their report in this prospectus, you will not be able to recover against Arthur Andersen LLP under Section 11 of the Securities Act for any untrue statements of a material fact contained in the financial statements audited by Arthur Andersen LLP or any omissions to state a material fact required to be stated therein. LEGAL MATTERS The validity of the securities offered hereby will be passed upon for us by Kane Kessler, P.C., New York, New York. Any underwriters will be advised about the other issues relating to any offering by their own legal counsel. 34 - -------------------------------------------------------------------------------- 2,800,000 SHARES [JARDEN CORPORATION LOGO OMITTED] COMMON STOCK ---------------------------- PROSPECTUS SUPPLEMENT September 25, 2003 ---------------------------- JOINT BOOK RUNNING MANAGERS CIBC WORLD MARKETS BANC OF AMERICA SECURITIES LLC -------------------- SUNTRUST ROBINSON HUMPHREY WILLIAM BLAIR & COMPANY - -------------------------------------------------------------------------------- YOU SHOULD RELY ONLY ON THE INFORMATION CONTAINED IN THIS PROSPECTUS SUPPLEMENT AND THE ACCOMPANYING PROSPECTUS. NO DEALERS, SALESPERSON OR OTHER PERSON IS AUTHORIZED TO GIVE INFORMATION THAT IS NOT CONTAINED IN THIS PROSPECTUS SUPPLEMENT AND THE ACCOMPANYING PROSPECTUS. THIS PROSPECTUS SUPPLEMENT AND THE ACCOMPANYING PROSPECTUS IS NOT AN OFFER TO SELL NOR IS IT SEEKING AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED. THE INFORMATION CONTAINED IN THIS PROSPECTUS SUPPLEMENT AND THE ACCOMPANYING PROSPECTUS IS CORRECT ONLY AS OF THE DATE OF THIS PROSPECTUS SUPPLEMENT, REGARDLESS OF THE TIME OF THE DELIVERY OF THIS PROSPECTUS SUPPLEMENT AND THE ACCOMPANYING PROSPECTUS OR ANY SALE OF THESE SECURITIES. -----END PRIVACY-ENHANCED MESSAGE-----