UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

FORM 8-K

 

 

CURRENT REPORT

Pursuant to Section 13 or 15(d)

of the Securities Act of 1934

Date of Report (Date of earliest event reported): July 22, 2015

 

 

THE VALSPAR CORPORATION

(Exact name of registrant as specified in its charter)

 

 

 

Delaware   1-3011   36-2443580

(State or other jurisdiction

of incorporation)

  

(Commission

File Number)

  

(I.R.S. Employer

Identification No.)

 

1101 South 3rd Street, Minneapolis, Minnesota   55415
(Address of principal executive offices)   (Zip Code)

Registrant’s telephone number, including area code: (612) 851-7000

Not Applicable

(Former name or former address, if changed since last report)

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

 

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

 

Item 1.01. Entry into a Material Definitive Agreement.

On July 22, 2015, The Valspar Corporation, a Delaware corporation (“Valspar” or the “Company”), entered into an Underwriting Agreement with several underwriters represented by Merrill Lynch, Pierce, Fenner & Smith Incorporated, HSBC Securities (USA) Inc., Wells Fargo Securities, LLC and U.S. Bancorp Investments, Inc. for the sale of $350,000,000 aggregate principal amount of the Company’s 3.950% Senior Notes due 2026 (the “Notes”). The sale of the Notes was made pursuant to the Company’s shelf registration statement on Form S-3 (File No. 333-201521), filed with the SEC on January 15, 2015, together with a prospectus supplement dated July 22, 2015 and filed with the SEC on July 24, 2015 (the “Prospectus Supplement”).

The Notes were issued under an indenture (the “Base Indenture”), dated as of April 24, 2002, between the Company and The Bank of New York Mellon Trust Company, N.A. (as successor to Bank One Trust Company, N.A.), as trustee, as most recently supplemented by a Sixth Supplemental Indenture, dated as of July 27, 2015, among the Company, The Bank of New York Mellon Trust Company, N.A. (as successor to Bank One Trust Company, N.A.) and U.S. Bank National Association, as series trustee (the “Supplemental Indenture”). The description of the terms of the Base Indenture, as supplemented by the Supplemental Indenture (as supplemented, the “Indenture”), is incorporated herein by reference to the disclosures contained in Item 2.03 below.

 

Item 2.03. Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.

On July 27, 2015, the Company issued $350,000,000 aggregate principal amount of Senior Notes due 2026 pursuant to the Indenture. The Company intends to use the net proceeds of the Notes for the repayment of borrowings under its term loan credit facility, and for general corporate purposes.

The Notes will mature on January 15, 2026. Interest on the Notes will accrue from July 27, 2015 and will be payable on January 15 and July 15 of each year, beginning January 15, 2016. The Notes are unsecured and unsubordinated obligations and rank equally with all of the other unsecured and unsubordinated debt of the Company outstanding from time to time.

The Company may redeem the Notes, at any time in whole or from time to time in part, prior to October 15, 2025 (three months prior to their maturity date), at a redemption price equal to the greater of: (a) 100% of the principal amount of the Notes being redeemed; and (b) an amount equal to the sum of the present values of the remaining scheduled payments of principal and interest on the Notes (not including any portion of such payments of interest accrued as of the date of redemption), discounted to the date of redemption on a semiannual basis (assuming a 360-day year consisting of twelve 30-day months) at the treasury rate, plus 25 basis points, plus accrued and unpaid interest thereon to, but not including, the date of redemption. In addition, the Company may redeem the Notes at any time in whole or from time to time in part, prior to October 15, 2025 (three months prior to their maturity date), at a redemption price equal to 100% of the principal amount of the Notes being redeemed plus accrued and unpaid interest thereon to,

but not including, the date of redemption. Finally, if the Company experiences a “change of control repurchase event” (which is defined in the Supplemental Indenture and involves a change in control and related rating of the Notes below investment grade), the Company may be required to offer to purchase the Notes at a purchase price equal to 101% of the principal amount, plus accrued and unpaid interest.

The Indenture contains certain covenants. These covenants restrict the Company’s ability to incur debt secured by liens or engage in certain sale-leaseback transactions. These covenants are, however, subject to significant exceptions. The Company is also subject to a covenant concerning consolidations, mergers and transfers of substantially all of the Company’s property and assets.

Terms of the Indenture and the Notes are more fully described in the section of the Prospectus Supplement entitled “Description of the Notes.” The description above is a summary and is qualified in its entirety by the Base Indenture and Supplemental Indenture, filed herewith as Exhibits 4.1 and 4.2 respectively and incorporated herein by this reference.

 

Item 9.01 Financial Statements and Exhibits.

 

  (d) Exhibits

 

  1.1    Underwriting Agreement, dated July 22, 2015, by and among the Company and several underwriters represented by Merrill Lynch, Pierce, Fenner & Smith Incorporated, HSBC Securities (USA) Inc., Wells Fargo Securities, LLC and U.S. Bancorp Investments, Inc.
  4.1    Indenture dated as of April 24, 2002, between the Company and The Bank of New York Mellon Trust Company, N.A. (as successor to Bank One Trust Company, N.A.) (incorporated by reference to Exhibit 4(b) to the registrant’s Form 10-K for the year ended October 25, 2002)
  4.2    Sixth Supplemental Indenture, among the Company, The Bank of New York Mellon Trust Company, N.A. (as successor to Bank One Trust Company, N.A.) and U.S. Bank National Association, as series trustee, dated as of July 27, 2015, to Indenture dated as of April 24, 2002, between the Company and The Bank of New York Mellon Trust Company, N.A. (as successor to Bank One Trust Company, N.A.)
23.1    Consent of General Counsel of Registrant (included as part of Exhibit 99.1)
23.2    Consent of Maslon LLP (included as part of Exhibit 99.2)
99.1    Opinion of General Counsel of Registrant
99.2    Opinion of Maslon LLP

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

 

    THE VALSPAR CORPORATION
Dated: July 28, 2015    

/s/ Rolf Engh

    Name:   Rolf Engh
    Title:   Secretary

INDEX TO EXHIBITS

 

  1.1    Underwriting Agreement, dated July 22, 2015, by and among the Company and several underwriters represented by Merrill Lynch, Pierce, Fenner & Smith Incorporated, HSBC Securities (USA) Inc., Wells Fargo Securities, LLC and U.S. Bancorp Investments, Inc.
  4.1    Indenture dated as of April 24, 2002, between the Company and The Bank of New York Mellon Trust Company, N.A. (as successor to Bank One Trust Company, N.A.) (incorporated by reference to Exhibit 4(b) to the registrant’s Form 10-K for the year ended October 25, 2002)
  4.2    Sixth Supplemental Indenture, among the Company, The Bank of New York Mellon Trust Company, N.A. (as successor to Bank One Trust Company, N.A.) and U.S. Bank National Association, as series trustee, dated as of July 27, 2015, to Indenture dated as of April 24, 2002, between the Company and The Bank of New York Mellon Trust Company, N.A. (as successor to Bank One Trust Company, N.A.)
23.1    Consent of General Counsel of Registrant (included as part of Exhibit 99.1)
23.2    Consent of Maslon LLP (included as part of Exhibit 99.2)
99.1    Opinion of General Counsel of Registrant
99.2    Opinion of Maslon LLP


Exhibit 1.1

$350,000,000

The Valspar Corporation

$350,000,000 3.950% Notes due 2026

Underwriting Agreement

July 22, 2015

MERRILL LYNCH, PIERCE, FENNER & SMITH

             INCORPORATED

HSBC SECURITIES (USA) INC.

WELLS FARGO SECURITIES, LLC

U.S. BANCORP INVESTMENTS, INC.

As Representatives of the several underwriters

 

c/o Merrill Lynch, Pierce, Fenner & Smith

            Incorporated

One Bryant Park

New York, New York 10036

HSBC Securities (USA) Inc.

452 5th Avenue

New York, NY 10018

Wells Fargo Securities, LLC

550 South Tryon Street

Charlotte, North Carolina 28202

U.S. Bancorp Investments, Inc.

214 N. Tryon St., 26th Floor

Charlotte, North Carolina 28202

Ladies and Gentlemen:

The Valspar Corporation, a Delaware corporation (the “Company”), proposes to sell to the several underwriters named in Schedule I hereto (the “Underwriters”), for whom you (the “Representatives”) are acting as representatives, $350,000,000 aggregate principal amount of the Company’s 3.950% Notes due 2026 (the “Securities”), to be issued under a sixth supplemental indenture dated as of the Closing Date among the Company, The Bank of New York Mellon Trust Company, N.A. (the “Original Trustee”) and U.S. Bank, N.A., as series trustee (the “Trustee”), supplementing that certain indenture, dated as of April 24, 2002, between the Company and the Original Trustee, as successor trustee (as supplemented to date, the “Indenture”). To the extent there are no additional Underwriters listed on Schedule I other than

you, the term Representatives as used herein shall mean you, as Underwriters, and the terms Representatives and Underwriters shall mean either the singular or plural as the context requires.

Certain terms used herein are defined in Section 20 hereof.

Section 1. Representations and Warranties. The Company represents and warrants to, and agrees with, each Underwriter as set forth below in this Section 1.

(a) The Company meets the requirements for use of Form S-3 under the Act and has prepared and filed with the Commission an automatic shelf registration statement, as defined in Rule 405 (Registration No. 333-201521) on Form S-3, including a related Base Prospectus, for registration under the Act of the offering and sale of the Securities. Such Registration Statement, including any amendments thereto filed prior to the Execution Time, became effective upon filing and no notice of objection of the Commission to the use of such registration statement or any post-effective amendment thereto pursuant to Rule 401(g)(2) under the Act has been received by the Company. No order suspending the effectiveness of the Registration Statement has been issued by the Commission and no proceeding for that purpose or pursuant to Section 8A of the Act against the Company or related to the offering has been initiated or, to the Company’s knowledge, threatened by the Commission. The Company may have filed with the Commission, as part of an amendment to the Registration Statement or pursuant to Rule 424(b), one or more preliminary prospectus supplements relating to the Securities, each of which has previously been furnished to you. The Company will file with the Commission a final prospectus supplement relating to the Securities in accordance with Rule 424(b). As filed, such final prospectus supplement shall contain all information required by the Act and the rules thereunder, and, except to the extent the Representatives shall agree in writing to a modification, shall be in all substantive respects in the form furnished to you prior to the Execution Time or, to the extent not completed at the Execution Time, shall contain only such specific additional information and other changes (beyond that contained in the Base Prospectus and any Preliminary Prospectus) as the Company has advised you, prior to the Execution Time, will be included or made therein. The Registration Statement, at the Execution Time, meets the requirements set forth in Rule 415(a)(1)(x).

Any reference herein to the Registration Statement, the Base Prospectus, any Preliminary Prospectus or the Final Prospectus shall be deemed to refer to and include the documents incorporated by reference therein pursuant to Item 12 of Form S-3 which were filed under the Exchange Act on or before the Effective Date of the Registration Statement or the issue date of the Base Prospectus, any Preliminary Prospectus or the Final Prospectus, as the case may be; and any reference herein to the terms “amend,” “amendment” or “supplement” with respect to the Registration Statement, the Base Prospectus, any Preliminary Prospectus or the Final Prospectus shall be deemed to refer to and include the filing of any document under the Exchange Act after the Effective Date of the Registration Statement or the issue date of the Base Prospectus, any Preliminary Prospectus or the Final Prospectus, as the case may be, deemed to be incorporated therein by reference.

(b) On each Effective Date, the Registration Statement did, and when the Final Prospectus is first filed in accordance with Rule 424(b) and on the Closing Date (as defined herein), the Final Prospectus (and any supplement thereto) will, comply in all material respects

 

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with the applicable requirements of the Act, the Exchange Act and the Trust Indenture Act and the respective rules thereunder; on each Effective Date and at the Execution Time, the Registration Statement did not and will 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 not misleading; on the Effective Date and on the Closing Date the Indenture did or will comply in all material respects with the applicable requirements of the Trust Indenture Act and the rules thereunder; and on the date of any filing pursuant to Rule 424(b) and on the Closing Date, the Final Prospectus (together with any supplement thereto) will not include any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading; provided, however, that the Company makes no representations or warranties as to (i) that part of the Registration Statement which shall constitute the Statement of Eligibility and Qualification (Form T-1) under the Trust Indenture Act of the Trustee or (ii) the information contained in or omitted from the Registration Statement or the Final Prospectus (or any supplement thereto) in reliance upon and in conformity with information furnished in writing to the Company by or on behalf of any Underwriter through the Representatives specifically for inclusion in the Registration Statement or the Final Prospectus (or any supplement thereto), it being understood and agreed that the only such information furnished by or on behalf of any Underwriter consists of the information described as such in Section 8 hereof.

(c) The Disclosure Package and each electronic road show when taken together as a whole with the Disclosure Package, does not contain any untrue statement of a material fact or omit to state any material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading. The preceding sentence does not apply to statements in or omissions from the Disclosure Package based upon and in conformity with written information furnished to the Company by any Underwriter through the Representatives specifically for use therein, it being understood and agreed that the only such information furnished by or on behalf of any Underwriter consists of the information described as such in Section 8 hereof.

(d) (i) At the time of filing the Registration Statement, (ii) at the time of the most recent amendment thereto for the purposes of complying with Section 10(a)(3) of the Act (whether such amendment was by post-effective amendment, incorporated report filed pursuant to Sections 13 or 15(d) of the Exchange Act or form of prospectus), (iii) at the time the Company or any person acting on its behalf (within the meaning, for this clause only, of Rule 163(c)) made any offer relating to the Securities in reliance on the exemption in Rule 163, and (iv) at the Execution Time (with such date being used as the determination date for purposes of this clause (iv)), the Company was or is (as the case may be) a “well-known seasoned issuer” as defined in Rule 405. The Company agrees to pay the fees required by the Commission relating to the Securities within the time required by Rule 456(b)(1) without regard to the proviso therein and otherwise in accordance with Rules 456(b) and 457(r).

(e) (i) At the earliest time after the filing of the Registration Statement that the Company or another offering participant made a bona fide offer (within the meaning of Rule 164(h)(2)) of the Securities and (ii) as of the Execution Time (with such date being used as the determination date for purposes of this clause (ii)), the Company was not and is not an Ineligible

 

3

Issuer (as defined in Rule 405), without taking account of any determination by the Commission pursuant to Rule 405 that it is not necessary that the Company be considered an Ineligible Issuer.

(f) Each Issuer Free Writing Prospectus and the final term sheet prepared and filed pursuant to Section 5(b) hereto does not include any information that conflicts with the information contained in the Registration Statement, including any document incorporated therein by reference and any prospectus supplement deemed to be a part thereof that has not been superseded or modified. The foregoing sentence does not apply to statements in or omissions from any Issuer Free Writing Prospectus based upon and in conformity with written information furnished to the Company by any Underwriter through the Representatives specifically for use therein, it being understood and agreed that the only such information furnished by or on behalf of any Underwriter consists of the information described as such in Section 8 hereof.

(g) The documents incorporated by reference in the Disclosure Package and the Final Prospectus, when filed with the Commission, conformed or will conform, as the case may be, in all material respects with the requirements of the Exchange Act and, when read together with the other information in the Disclosure Package and the Final Prospectus, did not or will not, as the case may be, 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.

(h) The Company and its subsidiaries employ disclosure controls and procedures that are designed to ensure that information required to be disclosed by the Company in the reports that it files or submits under the Exchange Act is properly and effectively recorded, processed, summarized and reported within the time periods specified in applicable rules, regulations and forms promulgated by the Commission and is properly and effectively accumulated and communicated to the Company’s officers, including its principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure.

(i) The Company’s historical financial statements and the related notes thereto included or incorporated by reference in the Disclosure Package and the Final Prospectus present fairly, in all material respects, the consolidated financial position of the Company and its subsidiaries as of the dates indicated and the consolidated results of their operations and the changes in their consolidated cash flows for the periods specified; such financial statements have been prepared in conformity with generally accepted accounting principles applied on a consistent basis throughout the periods covered thereby, except as described in the notes to such financial statements; and the other historical financial information of the Company included or incorporated by reference in the Disclosure Package and the Final Prospectus has been derived from the accounting records of the Company and its subsidiaries and presents fairly, in all material respects, the information shown thereby.

(j) The Company and its subsidiaries maintain a system of internal accounting controls designed to provided reasonable assurances that (i) transactions are executed in accordance with management’s general or specific authorization, (ii) transactions are recorded as necessary to permit preparation of financial statements in conformity with generally accepted accounting principles and to maintain accountability for assets, (iii) access to assets is permitted only in accordance with management’s general or specific authorization and (iv) the recorded

 

4

accountability for material assets is compared with the existing assets at reasonable intervals and appropriate action is taken with respect to any material differences.

(k) Since the date of the most recent financial statements of the Company included or incorporated by reference in the Disclosure Package and the Final Prospectus, (i) there has not been any material change in the capital stock of the Company or any of its significant subsidiaries (as defined in Rule 1-02(w) of Regulation S-X under the Securities Act) or long-term debt of the Company or any of its subsidiaries (except for (A) any subsequent issuances of capital stock pursuant to the exercise of outstanding stock options or under existing officer, director or employee benefit plans and options granted under, or contracts or commitments pursuant to, existing stock option or officer, director or employee benefit plans and (B) any repurchases of common stock pursuant to stock repurchase programs approved by the Company’s Board of Directors) or any dividend or distribution of any kind declared, set aside for payment, paid or made by the Company on any class of capital stock (other than regular cash dividends consistent with past practice), or any material adverse change in or affecting the business, properties, financial position or results of operations of the Company and its subsidiaries taken as a whole, (ii) neither the Company nor any of its subsidiaries has entered into any transaction or agreement that is material to the Company and subsidiaries taken as a whole or incurred any liability or obligation, direct or contingent, that is material to the Company and its subsidiaries, taken as a whole and (iii) neither the Company nor any of its subsidiaries has sustained any loss or interference with its business from fire, explosion, flood or other calamity, whether or not covered by insurance, or from any labor disturbance or dispute or any action, order or decree of any court or arbitrator or governmental or regulatory authority that is material to the Company and its subsidiaries taken as a whole, except in each case as otherwise disclosed in the Disclosure Package and the Final Prospectus.

(l) The Company and each of its significant subsidiaries set forth on Schedule II hereto (each a “Significant Subsidiary” and, collectively, the “Significant Subsidiaries”) have been duly organized and are validly existing and in good standing under the laws of their respective jurisdictions of organization, are duly qualified to do business and are in good standing in each jurisdiction in which their respective ownership or lease of property or the conduct of their respective businesses requires such qualification, and have all corporate, or such other comparable, power and authority necessary to own or hold their respective properties and to conduct their respective businesses as disclosed in the Disclosure Package and the Final Prospectus, except where the failure to be so qualified or in good standing or have such power or authority would not, individually or in the aggregate, reasonably be expected to have a material adverse effect on the business, properties, financial position, results of operations of the Company and its subsidiaries taken as a whole or on the performance by the Company of its obligations under the Securities (a “Material Adverse Effect”).

(m) The Company has an authorized capitalization as set forth in the Disclosure Package and the Final Prospectus under the heading “Capitalization” (except for (1) any subsequent issuances of capital stock pursuant to the exercise of outstanding stock options or under existing officer, director or employee benefit plans and options granted under, or contracts or commitments pursuant to, existing stock option or officer, director or employee benefit plans and (2) any repurchases of common stock pursuant to stock repurchase programs approved by the Company’s Board of Directors); and all the outstanding shares of capital stock or other

 

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equity interests of each Significant Subsidiary of the Company have been duly and validly authorized and issued, are fully paid and non-assessable and are owned directly or indirectly by the Company, free and clear of any lien, charge, encumbrance, security interest, restriction on voting or transfer or any other claim of any third party (except, (A) in the case of any foreign subsidiary, for directors’ qualifying shares, and (B) except as otherwise disclosed in or contemplated by the Disclosure Package and the Final Prospectus).

(n) The Indenture has been duly authorized, executed and delivered by the Company and constitutes a valid and legally binding agreement of the Company enforceable against the Company in accordance with its terms, subject to applicable bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium or similar laws affecting the enforcement of creditors’ rights or remedies generally and by equitable principles relating to enforceability, including principles of good faith and fair dealing (regardless of whether enforcement is sought in a proceeding at law or in equity) (collectively, the “Enforceability Exceptions”); and the Indenture has been qualified under the Trust Indenture Act.

(o) The Securities have been duly authorized by the Company and, when duly executed, authenticated, issued and delivered as provided in the Indenture and paid for as provided herein, will constitute valid and legally binding obligations of the Company enforceable against the Company in accordance with their terms, subject to the Enforceability Exceptions, and will be entitled to the benefits of the Indenture.

(p) This Agreement has been duly authorized, executed and delivered by the Company.

(q) Each of this Agreement, the Securities and the Indenture (collectively, the “Transaction Documents”) conforms or will conform, as the case may be, in all material respects to the descriptions thereof contained in the Disclosure Package and the Final Prospectus.

(r) Neither (i) the Company nor any of its Significant Subsidiaries is in violation of its charter, by-laws or similar organizational documents, (ii) the Company nor any of its subsidiaries is in default, and no event has occurred that, with notice or lapse of time or both, would constitute such a default, in the due performance or observance of any term, covenant or condition contained in any indenture, mortgage, deed of trust, loan agreement or other agreement or instrument to which the Company or any of its subsidiaries is a party or by which the Company or any of its subsidiaries is bound or to which any of the property or assets of the Company or any of its subsidiaries is subject or (iii) the Company nor any of its subsidiaries is in violation of any law or statute or any judgment, order, rule or regulation of any court or arbitrator or governmental or regulatory authority, except, in the case of clause (ii) or (iii) above, for any such default or violation that would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

(s) The execution, delivery and performance by the Company of each of the Transaction Documents, the issuance and sale of the Securities and compliance by the Company with the terms thereof and the consummation of the transactions contemplated by the Transaction Documents will not (i) conflict with or result in a breach or violation of any of the terms or provisions of, or constitute a default under, or result in the creation or imposition of any

 

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lien, charge or encumbrance upon any property or assets of the Company or any of its subsidiaries pursuant to, any indenture, mortgage, deed of trust, loan agreement or other agreement or instrument to which the Company or any of its subsidiaries is a party or by which the Company or any of its subsidiaries is bound or to which any of the property or assets of the Company or any of its subsidiaries is subject, (ii) result in any violation of the provisions of the charter, by-laws or similar organizational documents of the Company or any of its Significant Subsidiaries or (iii) result in the violation of any law or statute or any judgment, order, rule or regulation of any court or arbitrator or governmental or regulatory authority having jurisdiction over the Company or any of its subsidiaries or any of their respective properties, except, in the case of clauses (i) and (iii) above, for any such conflict, breach or violation that would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

(t) No consent, approval, authorization, order, registration or qualification of or with any court or arbitrator or governmental or regulatory authority is required for the execution, delivery and performance by the Company of each of the Transaction Documents, the issuance and sale of the Securities and compliance by the Company with the terms thereof and the consummation of the transactions contemplated by the Transaction Documents, except for such consents, approvals, authorizations, orders and registrations or qualifications as have been obtained or made or may be required under applicable state securities laws in connection with the purchase and resale of the Securities by the Underwriters.

(u) Except as described in the Disclosure Package and the Final Prospectus, there are no legal, governmental or regulatory investigations, actions, suits or proceedings pending to which the Company or any of its subsidiaries is a party or to which any property of the Company or any of its subsidiaries is the subject that, individually or in the aggregate, would reasonably be expected to have a Material Adverse Effect; and to the knowledge of the Company, no such investigations, actions, suits or proceedings are threatened by any governmental or regulatory authority or others.

(v) Ernst & Young LLP, which has certified certain financial statements of the Company and its subsidiaries, is an independent registered public accounting firm with respect to the Company and its subsidiaries within the meaning of Rule 101 of the Code of Professional Conduct of the American Institute of Certified Public Accountants and its interpretations and rulings thereunder.

(w) Except as described in the Disclosure Package and the Final Prospectus, the Company and its subsidiaries have good and marketable title in fee simple (in the case of real property) or good and marketable title (in the case of personal property) to, or have valid rights to lease or otherwise use, all items of real and personal property that are material to the Company and its subsidiaries taken as a whole, in each case free and clear of all liens, encumbrances, claims and defects and imperfections of title except those that (i) do not materially interfere with the use made and proposed to be made of such property by the Company and its subsidiaries or (ii) would not reasonably be expected, individually or in the aggregate, to have a Material Adverse Effect.

(x) Except as described in the Disclosure Package and the Final Prospectus, (i) the Company and its subsidiaries own, possess or can acquire on reasonable terms adequate rights to

 

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use all patents, patent applications, trademarks, service marks, trade names, trademark registrations, service mark registrations, copyrights, licenses and know-how (including trade secrets and other unpatented and/or unpatentable proprietary or confidential information, systems or procedures) (collectively, “Intellectual Property Rights”) necessary for the conduct of their respective businesses as described in the Disclosure Package and the Final Prospectus, except any such failures to own or possess the right to use such Intellectual Property Rights that would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect, (ii) the conduct of their respective businesses does not conflict in any material respect with any Intellectual Property Rights of others, except any such conflicts that would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect and (iii) the Company and its subsidiaries have not received any actual notice of any claim of infringement of or conflict with the asserted Intellectual Property Rights of others, except any such claims that would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

(y) The Company and its subsidiaries taken as a whole carry or are entitled to the benefits of insurance covering their respective properties, operations, personnel and businesses, including business interruption insurance, which insurance is in such amounts and insures against such losses and risks as are customary for companies engaged in similar businesses in similar industries as the Company and its subsidiaries.

(z) The Company and its subsidiaries have filed all tax returns material to the Company and its subsidiaries taken as a whole required to be filed through the date hereof and paid all taxes shown as due on such returns as filed, except for taxes being contested in good faith and for which adequate reserves have been established in accordance with generally accepted accounting principles; and except as otherwise disclosed in the Disclosure Package and the Final Prospectus, there is no tax deficiency material to the Company and its subsidiaries taken as a whole that has been, or would reasonably be expected to be, asserted against the Company or any of its subsidiaries or any of their respective properties or assets.

(aa) The Company and its subsidiaries possess all licenses, certificates, permits and other authorizations issued by, and have made all declarations and filings with, the appropriate federal, state, local or foreign governmental or regulatory authorities that are necessary for the ownership or lease of their respective properties or the conduct of their respective businesses as described in the Disclosure Package and the Final Prospectus, except where the failure to possess or make the same would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect; and except as described in the Disclosure Package and the Final Prospectus, neither the Company nor any of its subsidiaries has received actual notice of any revocation or modification of any such license, certificate, permit or authorization, except any such revocations or modifications that would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

(bb) No labor disturbance by or imminent dispute with employees of the Company or any of its subsidiaries exists or, to the knowledge of the Company, is contemplated or threatened, except any such disturbances or disputes that would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

 

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(cc) Except as described in the Disclosure Package and the Final Prospectus, (i) there is not any and there has been no storage, generation, transportation, handling, treatment, disposal, discharge, emission or other release of any kind of toxic or other wastes or other hazardous substances (“Hazardous Substances”) by, due to, or caused by the Company or any subsidiary (or any other entity for whose acts or omissions the Company is or may be liable) upon any property now or previously owned or leased by the Company or any subsidiary, or upon any other property, except in compliance with any applicable Environmental Laws (defined below), and (ii) Hazardous Substances are not otherwise present at any property now or previously owned or leased by the Company or any subsidiary, which in the case of either (i) or (ii) would be a violation of or give rise to any liability under any applicable law, rule, regulation, order, judgment, decree or permit relating to pollution or protection of human health and the environment (“Environmental Law”), except in the case of clauses (i) and (ii) above, any action or circumstance that (individually or in the aggregate) would not reasonably be expected to result in a Material Adverse Effect. Except as described in the Disclosure Package and the Final Prospectus, neither the Company nor any subsidiary has agreed to assume, undertake or provide indemnification for any liability of any other person under any Environmental Law, including any obligation for cleanup or remedial action, except any such assumption, undertaking or provision that (individually or in the aggregate) would not reasonably be expected to result in a Material Adverse Effect. Except as described in the Disclosure Package and the Final Prospectus, there is no pending or, to the Company’s knowledge, threatened administrative, regulatory or judicial action, claim or notice of noncompliance or violation, investigation or proceedings relating to any Environmental Law against the Company or any subsidiary, except such actions, claims, notices of noncompliance, violations, investigations and proceedings that (individually or in the aggregate) would not reasonably be expected to result in a Material Adverse Effect.

(dd) Each employee benefit plan, within the meaning of Section 3(3) of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), that is required to comply with ERISA and that is maintained, administered or contributed to by the Company or any of its affiliates for employees or former employees of the Company and its affiliates has been maintained in all material respects in compliance with its terms and the requirements of any applicable laws, statutes, orders, rules and regulations, including but not limited to ERISA and the Internal Revenue Code of 1986, as amended (the “Code”); and no prohibited transaction, within the meaning of Section 406 of ERISA or Section 4975 of the Code, has occurred with respect to any such plan excluding transactions effected pursuant to a statutory or administrative exemption, except for any such failures to comply and prohibited transactions that would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect; and except as disclosed in the Disclosure Package and the Final Prospectus, (i) for each such plan that is subject to the funding rules of Section 412 of the Code or Section 302 of ERISA, the minimum funding standards of Section 412 of the Code have been satisfied, no waiver of those minimum funding standards has been granted and none of the Company or any of its affiliates has requested a funding waiver; and (ii) for each such plan that is subject to those funding rules and is a defined benefit plan (as defined in Section 414(j) of the Code), the funding target attainment percentage of the plan is not below 100%, as determined under Section 430 of the Code and as most recently certified by the plan’s actuaries, by any amount that, including the matters described in both clauses (i) and (ii), individually or in the aggregate is material to the Company and its subsidiaries taken as a whole. For purposes of this clause (dd), the term

 

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“affiliate” shall mean any entity that is treated with the Company as a single employer pursuant to Sections 414(b), (c) or (m) of the Code.

(ee) The Company is in compliance in all material respects with the applicable provisions of the Sarbanes-Oxley Act of 2002 and the rules and regulations of the Commission adopted pursuant thereto as such rules and regulations currently apply to the Company (collectively, the “Sarbanes-Oxley Act”). There is and has been no failure on the part of any of the Company’s officers or directors, in their capacities as such, to comply with any applicable provisions of the Sarbanes-Oxley Act, except such failures as would not, individually or in the aggregate, reasonably be expected to result in a Material Adverse Effect.

(ff) The Company is not, and after giving effect to the offering and sale of the Securities and the application of the proceeds thereof as described in the Disclosure Package and the Final Prospectus, will not be, an “investment company” within the meaning of the Investment Company Act of 1940, as amended, and the rules and regulations of the Commission thereunder.

(gg) Neither the Company nor any of its subsidiaries nor, to the knowledge of the Company, any director, officer or employee of, or any agent, affiliate or other person associated with or acting on behalf of, the Company or any of its subsidiaries has (i) used any corporate funds for any unlawful contribution, gift, entertainment or other unlawful expense relating to political activity; (ii) made or taken an act in furtherance of an offer, promise or authorization of any direct or indirect unlawful payment or benefit involving corporate funds or resources to any foreign or domestic government or regulatory official or employee, including of any government-owned or controlled entity or of a public international organization, or any person acting in an official capacity for or on behalf of any of the foregoing, or any political party or party official or candidate for political office; (iii) violated or is in violation of any provision of the Foreign Corrupt Practices Act of 1977, as amended, or any applicable law or regulation implementing the OECD Convention on Combating Bribery of Foreign Public Officials in International Business Transactions, or committed an offense under the Bribery Act 2010 of the United Kingdom, or any other comparable applicable anti-bribery or anti-corruption laws; or (iv) other than any action described in clause (iii), made, offered, agreed, requested or taken any other act in furtherance of any unlawful bribe or other unlawful benefit, including, without limitation, any rebate, payoff, influence payment, kickback or other unlawful or improper payment or benefit (in the case of clauses (i), (ii) and (iv) above, with such exceptions as, individually or in the aggregate, are not material). The Company and its subsidiaries have instituted, maintain and enforce, and will continue to maintain and enforce policies and procedures designed to promote compliance with all applicable anti-bribery and anti-corruption laws.

(hh) The operations of the Company and its subsidiaries are and have been conducted at all times in compliance with applicable financial recordkeeping and reporting requirements, including those of the Currency and Foreign Transactions Reporting Act of 1970, as amended, the applicable money laundering statutes of all jurisdictions where the Company or any of its subsidiaries conducts business, the rules and regulations thereunder and any related or similar rules, regulations or guidelines issued, administered or enforced by any governmental or regulatory agency (collectively, the “Anti-Money Laundering Laws”) and no action, suit or proceeding by or before any court or governmental or regulatory agency, authority or body or

 

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any arbitrator involving the Company or any of its subsidiaries with respect to the Anti-Money Laundering Laws is pending or, to the knowledge of the Company, threatened.

(ii) Neither the Company nor any of its subsidiaries nor, to the knowledge of the Company, any directors, officers or employees of, or any agent, affiliate or other person associated with or acting on behalf of, the Company or any of its subsidiaries is currently the subject or the target of any sanctions administered or enforced by the U.S. Government (including, without limitation, the Office of Foreign Assets Control of the U.S. Department of the Treasury (“OFAC”) or the U.S. Department of State and including, without limitation, the designation as a “specially designated national” or “blocked person”), the United Nations Security Council (“UNSC”), the European Union, Her Majesty’s Treasury (“HMT”), or other relevant sanctions authority (collectively, “Sanctions”), nor is the Company, any of its subsidiaries located, organized or resident in a country or territory that is the subject or the target of Sanctions, including, without limitation, Cuba, Burma (Myanmar), Iran, North Korea, Sudan and Syria (each, a “Sanctioned Country”); and the Company will not directly or indirectly use the proceeds of the offering of the Securities hereunder, or lend, contribute or otherwise make available such proceeds to any subsidiary, joint venture partner or other person or entity (i) to fund or facilitate any activities of or business with any person that, at the time of such funding or facilitation, is the subject or the target of Sanctions, (ii) to fund or facilitate any activities of or business in any Sanctioned Country or (iii) in any other manner that will result in a violation by any person (including any person participating in the transaction, whether as underwriter, advisor, investor or otherwise) of Sanctions. For the past three years, the Company and its subsidiaries have not knowingly engaged in, and are not now knowingly engaged in, any dealings or transactions with any person that at the time of the dealing or transaction is or was the subject or the target of Sanctions or with any Sanctioned Country.

(jj) Neither the Company nor any of its subsidiaries is a party to any contract, agreement or understanding with any person (other than this Agreement) that would give rise to a valid claim against any of them or any Underwriter for a brokerage commission, finder’s fee or like payment in connection with the offering and sale of the Securities.

(kk) The Company has not taken, directly or indirectly, any action designed to or that could reasonably be expected to cause or result in any stabilization or manipulation of the price of the Securities.

Any certificate signed by any officer of the Company and delivered to the Representatives or counsel for the Underwriters in connection with the offering of the Securities shall be deemed a representation and warranty by the Company, as to matters covered thereby, to each Underwriter.

Section 2. Purchase and Sale. Subject to the terms and conditions and in reliance upon the representations and warranties herein set forth, the Company agrees to sell to each Underwriter, and each Underwriter agrees, severally and not jointly, to purchase from the Company at 98.910% of the principal amount thereof, the respective principal amounts of the Securities set forth opposite such Underwriter’s name in Schedule I hereto.

 

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Section 3. Delivery and Payment. Delivery of and payment for the Securities shall be made at 10:00 a.m., New York City time, on July 27, 2015, or at such time on such later date not more than three Business Days after the foregoing date as the Representatives shall designate, which date and time may be postponed by agreement between the Representatives and the Company or as provided in Section 9 hereof (such date and time of delivery and payment for the Securities being herein called the “Closing Date”). Delivery of the Securities shall be made to the Representatives for the respective accounts of the several Underwriters against payment by the several Underwriters through the Representatives of the purchase price thereof to or upon the order of the Company by wire transfer payable in same-day funds to an account specified by the Company. Delivery of the Securities shall be made through the facilities of The Depository Trust Company unless the Representatives shall otherwise instruct.

Section 4. Offering by Underwriters. It is understood that the several Underwriters propose to offer the Securities for sale to the public as set forth in the Final Prospectus.

Section 5. Agreements. The Company agrees with the several Underwriters that:

(a) Prior to the termination of the offering of the Securities, the Company will not file any amendment of the Registration Statement or supplement (including the Final Prospectus or any Preliminary Prospectus) to the Base Prospectus unless the Company has furnished you a copy for your review prior to filing and will not file any such proposed amendment or supplement to which you reasonably object. The Company will cause the Final Prospectus, properly completed, and any supplement thereto to be filed in a form approved by the Representatives with the Commission pursuant to the applicable paragraph of Rule 424(b) within the time period prescribed and will provide evidence satisfactory to the Representatives of such timely filing. The Company will promptly advise the Representatives (i) when the Final Prospectus, and any supplement thereto, shall have been filed (if required) with the Commission pursuant to Rule 424(b), (ii) when, prior to termination of the offering of the Securities, any amendment to the Registration Statement shall have been filed or become effective, (iii) of any request by the Commission or its staff for any amendment of the Registration Statement, or any Rule 462(b) Registration Statement, or for any supplement to the Final Prospectus or for any additional information, (iv) of the issuance by the Commission of any stop order suspending the effectiveness of the Registration Statement or of any notice objecting to its use or the institution or threatening of any proceeding for that purpose and (v) of the receipt by the Company of any notification with respect to the suspension of the qualification of the Securities for sale in any jurisdiction or the institution or threatening of any proceeding for such purpose. The Company will use its best efforts to prevent the issuance of any such stop order or the occurrence of any such suspension or objection to the use of the Registration Statement and, upon such issuance, occurrence or notice of objection, to obtain as soon as possible the withdrawal of such stop order or relief from such occurrence or objection, including, if necessary, by filing an amendment to the Registration Statement or a new registration statement and using its best efforts to have such amendment or new registration statement declared effective as soon as practicable.

(b) To prepare a final term sheet, containing solely a description of final terms of the Securities and the offering thereof, in the form approved by you and substantially in the form of Exhibit A hereto and to file such term sheet pursuant to Rule 433(d) within the time required by such Rule.

 

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(c) If, at any time prior to the filing of the Final Prospectus pursuant to Rule 424(b), any event occurs as a result of which the Disclosure Package 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 or the circumstances then prevailing not misleading, the Company will (i) notify promptly the Representatives so that any use of the Disclosure Package may cease until it is amended or supplemented, (ii) amend or supplement the Disclosure Package to correct such statement or omission and (iii) supply any amendment or supplement to you in such quantities as you may reasonably request.

(d) If, at any time when a prospectus relating to the Securities is required to be delivered under the Act (including in circumstances where such requirement may be satisfied pursuant to Rule 172), any event occurs as a result of which the Final Prospectus as then 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 at such time not misleading, or if it shall be necessary to amend the Registration Statement, file a new registration statement or supplement the Final Prospectus to comply with the Act or the Exchange Act or the respective rules thereunder, including in connection with use or delivery of the Final Prospectus, the Company promptly will (i) notify the Representatives of any such event, (ii) prepare and file with the Commission, subject to the second sentence of paragraph (a) of this Section 5, an amendment or supplement or new registration statement which will correct such statement or omission or effect such compliance, (iii) use its best efforts to have any amendment to the Registration Statement or new registration statement declared effective as soon as practicable in order to avoid any disruption in use of the Final Prospectus and (iv) supply any supplemented Final Prospectus to you in such quantities as you may reasonably request.

(e) As soon as practicable, the Company will make generally available to its security holders and to the Representatives an earnings statement or statements of the Company and its subsidiaries which will satisfy the provisions of Section 11(a) of the Act and Rule 158.

(f) The Company will furnish to the Representatives and counsel for the Underwriters, without charge, signed copies of the Registration Statement (including exhibits thereto) and to each other Underwriter a copy of the Registration Statement (without exhibits thereto) and, so long as delivery of a prospectus by an Underwriter or dealer may be required by the Act (including in circumstances where such requirement may be satisfied pursuant to Rule 172), as many copies of each Preliminary Prospectus, the Final Prospectus and each Issuer Free Writing Prospectus and any supplement thereto as the Representatives may reasonably request. The Company will pay the expenses of printing or other production of all documents relating to the offering.

(g) The Company will arrange, if necessary, for the qualification of the Securities for sale under the laws of such jurisdictions as the Representatives may designate and will maintain such qualifications in effect so long as required for the distribution of the Securities; provided that in no event shall the Company be obligated to qualify to do business in any jurisdiction where it is not now so qualified or to take any action that would subject it to service of process in suits, other than those arising out of the offering or sale of the Securities, in any jurisdiction where it is not now so subject.

 

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(h) The Company agrees that, unless it has or shall have obtained the prior written consent of the Representatives, and each Underwriter, severally and not jointly, agrees with the Company that, unless it has or shall have obtained, as the case may be, the prior written consent of the Company, it has not made and will not make any offer relating to the Securities that would constitute an Issuer Free Writing Prospectus or that would otherwise constitute a “free writing prospectus” (as defined in Rule 405) required to be filed by the Company with the Commission or retained by the Company under Rule 433, other than a free writing prospectus containing the information contained in the final term sheet prepared and filed pursuant to Section 5(b) hereto; provided that the prior written consent of the parties hereto shall be deemed to have been given in respect of the Free Writing Prospectuses included in Schedule III hereto and any electronic road show. Any such free writing prospectus consented to by the Representatives or the Company is hereinafter referred to as a “Permitted Free Writing Prospectus.” The Company agrees that (x) it has treated and will treat, as the case may be, each Permitted Free Writing Prospectus as an Issuer Free Writing Prospectus and (y) it has complied and will comply, as the case may be, with the requirements of Rules 164 and 433 applicable to any Permitted Free Writing Prospectus, including in respect of timely filing with the Commission, legending and record keeping.

(i) The Company will not, without the prior written consent of the Representatives, offer, sell, contract to sell, pledge, or otherwise dispose of (or enter into any transaction which is designed to, or might reasonably be expected to, result in the disposition (whether by actual disposition or effective economic disposition due to cash settlement or otherwise) by the Company or any affiliate of the Company or any person in privity with the Company or any affiliate of the Company), directly or indirectly establish or increase a put equivalent position or liquidate or decrease a call equivalent position within the meaning of Section 16 of the Exchange Act, any debt securities issued or guaranteed by the Company (other than the Securities) or publicly announce an intention to effect any such transaction, until the date that is 30 days after the Closing Date.

(j) The Company will not take, directly or indirectly, any action designed to or that would constitute or that might reasonably be expected to cause or result in, under the Exchange Act or otherwise, stabilization or manipulation of the price of any security of the Company to facilitate the sale or resale of the Securities.

(k) The Company agrees to pay the costs and expenses incident to the performance of the obligations of the Company hereunder, including all costs and expenses relating to the following matters: (i) the preparation, printing or reproduction and filing with the Commission of the Registration Statement (including financial statements and exhibits thereto), each Preliminary Prospectus, the Final Prospectus and each Issuer Free Writing Prospectus, and each amendment or supplement to any of them, (ii) the printing (or reproduction) and delivery (including postage, air freight charges and charges for counting and packaging) of such copies of the Registration Statement, each Preliminary Prospectus, the Final Prospectus and each Issuer Free Writing Prospectus, and all amendments or supplements to any of them, as may, in each case, be reasonably requested for use in connection with the offering and sale of the Securities, (iii) the preparation, printing, authentication, issuance and delivery of certificates for the Securities, including any stamp or transfer taxes in connection with the original issuance and sale of the Securities, (iv) the printing (or reproduction) and delivery of this Agreement, any blue sky

 

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memorandum and all other agreements or documents printed (or reproduced) and delivered in connection with the offering of the Securities, (v) any registration or qualification of the Securities for offer and sale under the securities or blue sky laws of the several states as the Representatives may reasonably designate (including filing fees and the reasonable fees and expenses of counsel for the Underwriters relating to such registration and qualification), (vi) any filings required to be made with the Financial Industry Regulatory Authority, Inc. (including filing fees and the reasonable fees and expenses of counsel for the Underwriters relating to such filings), (vii) the transportation and other expenses incurred by or on behalf of Company representatives in connection with presentations to prospective purchasers of the Securities, (viii) the fees and expenses of the Company’s accountants and the fees and expenses of counsel (including local and special counsel) for the Company and (ix) all other costs and expenses incident to the performance by the Company of its obligations hereunder.

Section 6. Conditions to the Obligations of the Underwriters. The obligations of the Underwriters to purchase the Securities shall be subject to the accuracy of the representations and warranties on the part of the Company contained herein as of the Execution Time and the Closing Date, to the accuracy of the statements of the Company made in any certificates pursuant to the provisions hereof, to the performance by the Company of its obligations hereunder and to the following additional conditions:

(a) The Final Prospectus, and any supplement thereto, have been filed in the manner and within the time period required by Rule 424(b); the final term sheet contemplated by Section 5(b) hereto, and any other material required to be filed by the Company pursuant to Rule 433(d) under the Act, shall have been filed with the Commission within the applicable time periods prescribed for such filings by Rule 433; and no stop order suspending the effectiveness of the Registration Statement or any notice objecting to its use shall have been issued and no proceedings for that purpose shall have been instituted or threatened.

(b) The Company shall have requested and caused Rolf Engh, Esq., the Executive Vice President, General Counsel and Secretary of the Company, and Maslon LLP, outside counsel for the Company, to have furnished to the Representatives their opinions, dated the Closing Date and addressed to the Representatives, to the effect set forth in Exhibits B and C hereto.

(c) On the date of this Agreement and on the Closing Date, Ernst & Young LLP shall have furnished to the Underwriters letters, dated the respective dates of delivery thereof and addressed to the Underwriters, in form and substance reasonably satisfactory to the Underwriters, containing statements and information of the type customarily included in accountants’ “comfort letters” to underwriters with respect to the Company’s financial statements and certain financial information of the Company contained or incorporated by reference in the Disclosure Package and the Final Prospectus; provided that each letter shall use a “cut-off” date no more than three business days prior to the date of such letter.

(d) Subsequent to the Execution Time or, if earlier, the dates as of which information is given in the Registration Statement (exclusive of any amendment thereof) and the Final Prospectus (exclusive of any amendment or supplement thereto), there shall not have been (i) any change or decrease specified in the letter or letters referred to in paragraph (c) of this

 

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Section 6 or (ii) any change, or any development involving a prospective change, in or affecting the condition (financial or otherwise), earnings, business or properties of the Company and its subsidiaries taken as a whole, whether or not arising from transactions in the ordinary course of business, except as set forth in or contemplated in the Disclosure Package and the Final Prospectus (exclusive of any amendment or supplement thereto) the effect of which, in any case referred to in clause (i) or (ii) above, is, in the sole judgment of the Representatives, so material and adverse as to make it impractical or inadvisable to proceed with the offering or delivery of the Securities as contemplated by the Registration Statement (exclusive of any amendment thereof), the Disclosure Package and the Final Prospectus (exclusive of any amendment or supplement thereto).

(e) Subsequent to the Execution Time, there shall not have been any decrease in the rating of any of the Company’s debt securities by any “nationally recognized statistical rating organization” (as defined in Section 3(a)(62) of the Exchange Act) or any notice given of any intended or potential decrease in any such rating or of a possible change in any such rating that does not indicate the direction of the possible change.

(f) Prior to the Closing Date, the Company shall have furnished to the Representatives such further information, certificates and documents as the Representatives may reasonably request.

If any of the conditions specified in this Section 6 shall not have been fulfilled when and as provided in this Agreement, or if any of the opinions and certificates mentioned above or elsewhere in this Agreement shall not be reasonably satisfactory in form and substance to the Representatives and counsel for the Underwriters, this Agreement and all obligations of the Underwriters hereunder may be canceled at, or at any time prior to, the Closing Date by the Representatives. Notice of such cancellation shall be given to the Company in writing or by telephone or facsimile confirmed in writing.

The documents required to be delivered by this Section 6 shall be delivered at the office of Mayer Brown LLP, counsel for the Underwriters, at 71 South Wacker Drive, Chicago, Illinois 60606, on the Closing Date.

Section 7. Reimbursement of Underwriters’ Expenses. If the sale of the Securities provided for herein is not consummated because any condition to the obligations of the Underwriters set forth in Section 6 hereof is not satisfied, because of any termination pursuant to Section 10 hereof or because of any refusal, inability or failure on the part of the Company to perform any agreement herein or comply with any provision hereof other than by reason of a default by any of the Underwriters, the Company will reimburse the Underwriters severally through the Representatives on demand for all expenses (including reasonable fees and disbursements of counsel) that shall have been reasonably incurred by them in connection with the proposed purchase and sale of the Securities.

Section 8. Indemnification and Contribution. (a) The Company agrees to indemnify and hold harmless each Underwriter, the directors, officers, employees and agents of each Underwriter and each person who controls any Underwriter within the meaning of either the Act or the Exchange Act against any and all losses, claims, damages or liabilities, joint or several, to

 

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which they or any of them may become subject under the Act, the Exchange Act or other Federal or state statutory law or regulation, at common law or otherwise, insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon any untrue statement or alleged untrue statement of a material fact contained in the registration statement for the registration of the Securities as originally filed or in any amendment thereof, or in the Base Prospectus, any Preliminary Prospectus or any other preliminary prospectus supplement relating to the Securities, the Final Prospectus, any Issuer Free Writing Prospectus or the information contained in the final term sheet required to be prepared and filed pursuant to Section 5(b) hereto, or in any amendment thereof 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, and agrees to reimburse each such indemnified party, as incurred, for any legal or other expenses reasonably incurred by them in connection with investigating or defending any such loss, claim, damage, liability or action; provided, however, that the Company will not be liable in any such case to the extent that any such loss, claim, damage or liability arises out of or is based upon any such untrue statement or alleged untrue statement or omission or alleged omission made therein in reliance upon and in conformity with written information furnished to the Company by or on behalf of any Underwriter through the Representatives specifically for inclusion therein. This indemnity agreement will be in addition to any liability which the Company may otherwise have.

(b) Each Underwriter severally and not jointly agrees to indemnify and hold harmless the Company, each of its directors, each of its officers who signs the Registration Statement, and each person who controls the Company within the meaning of either the Act or the Exchange Act, to the same extent as the foregoing indemnity from the Company to each Underwriter, but only with reference to written information relating to such Underwriter furnished to the Company by or on behalf of such Underwriter through the Representatives specifically for inclusion in the documents referred to in the foregoing indemnity. This indemnity agreement will be in addition to any liability which any Underwriter may otherwise have. The Company acknowledges that the statements set forth (i) in the last paragraph of the cover page regarding delivery of the Securities and (ii) under the heading “Underwriting” (A) the list of Underwriters and their respective participation in the sale of the Securities, (B) the sentences related to concessions and reallowances and (C) the sentences related to stabilization, syndicate covering transactions and penalty bids in any Preliminary Prospectus and the Final Prospectus constitute the only information furnished in writing by or on behalf of the several Underwriters for inclusion in any Preliminary Prospectus, the Final Prospectus or any Issuer Free Writing Prospectus.

(c) Promptly after receipt by an indemnified party under this Section 8 of notice of the commencement of any action, such indemnified party will, if a claim in respect thereof is to be made against the indemnifying party under this Section 8, notify the indemnifying party in writing of the commencement thereof; but the failure so to notify the indemnifying party (i) will not relieve it from liability under paragraph (a) or (b) above unless and to the extent it did not otherwise learn of such action and such failure results in the forfeiture by the indemnifying party of substantial rights and defenses and (ii) will not, in any event, relieve the indemnifying party from any obligations to any indemnified party other than the indemnification obligation provided in paragraph (a) or (b) above. The indemnifying party shall be entitled to appoint counsel of the indemnifying party’s choice at the indemnifying party’s expense to represent the indemnified

 

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party in any action for which indemnification is sought (in which case the indemnifying party shall not thereafter be responsible for the fees and expenses of any separate counsel retained by the indemnified party or parties except as set forth below); provided, however, that such counsel shall be reasonably satisfactory to the indemnified party. Notwithstanding the indemnifying party’s election to appoint counsel to represent the indemnified party in an action, the indemnified party shall have the right to employ separate counsel (including local counsel), and the indemnifying party shall bear the reasonable fees, costs and expenses of a single separate counsel for the indemnified parties (in addition to local counsel) if (i) the use of counsel chosen by the indemnifying party to represent the indemnified party would present such counsel with a conflict of interest, (ii) the actual or potential defendants in, or targets of, any such action include both the indemnified party and the indemnifying party and the indemnified party shall have reasonably concluded that there may be legal defenses available to it and/or other indemnified parties which are different from or additional to those available to the indemnifying party, (iii) the indemnifying party shall not have employed counsel reasonably satisfactory to the indemnified party to represent the indemnified party within a reasonable time after notice of the institution of such action or (iv) the indemnifying party shall authorize the indemnified party to employ separate counsel at the expense of the indemnifying party. An indemnifying party will not, without the prior written consent of the indemnified parties, settle or compromise or consent to the entry of any judgment with respect to any pending or threatened claim, action, suit or proceeding in respect of which indemnification or contribution may be sought hereunder (whether or not the indemnified parties are actual or potential parties to such claim or action) unless such settlement, compromise or consent (i) includes an unconditional release of each indemnified party from all liability arising out of such claim, action, suit or proceeding and (ii) does not include a statement as to or an admission of fault, culpability or a failure to act, by or on behalf of any indemnified party.

(d) In the event that the indemnity provided in paragraph (a), (b) or (c) of this Section 8 is unavailable to or insufficient to hold harmless an indemnified party for any reason, the Company and the Underwriters severally agree to contribute to the aggregate losses, claims, damages and liabilities (including legal or other expenses reasonably incurred in connection with investigating or defending the same) (collectively “Losses”) to which the Company and one or more of the Underwriters may be subject in such proportion as is appropriate to reflect the relative benefits received by the Company on the one hand and by the Underwriters on the other from the offering of the Securities; provided, however, that in no case shall any Underwriter (except as may be provided in any agreement among underwriters relating to the offering of the Securities) be responsible for any amount in excess of the underwriting discount or commission applicable to the Securities purchased by such Underwriter hereunder. If the allocation provided by the immediately preceding sentence is unavailable for any reason, the Company and the Underwriters severally shall contribute in such proportion as is appropriate to reflect not only such relative benefits but also the relative fault of the Company on the one hand and of the Underwriters on the other in connection with the statements or omissions which resulted in such Losses as well as any other relevant equitable considerations. Benefits received by the Company shall be deemed to be equal to the total net proceeds from the offering (before deducting expenses) received by it, and benefits received by the Underwriters shall be deemed to be equal to the total underwriting discounts and commissions, in each case as set forth on the cover page of the Final Prospectus. Relative fault shall be determined by reference to, among other things, whether any untrue or any alleged untrue statement of a material fact or the omission or alleged

 

18

omission to state a material fact relates to information provided by the Company on the one hand or the Underwriters on the other, the intent of the parties and their relative knowledge, access to information and opportunity to correct or prevent such untrue statement or omission. The Company and the Underwriters agree that it would not be just and equitable if contribution were determined by pro rata allocation or any other method of allocation which does not take account of the equitable considerations referred to above. Notwithstanding the provisions of this paragraph (d), no person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. For purposes of this Section 8, each person who controls an Underwriter within the meaning of either the Act or the Exchange Act and each director, officer, employee and agent of an Underwriter shall have the same rights to contribution as such Underwriter, and each person who controls the Company within the meaning of either the Act or the Exchange Act, each officer of the Company who shall have signed the Registration Statement and each director of the Company shall have the same rights to contribution as the Company, subject in each case to the applicable terms and conditions of this paragraph (d).

Section 9. Default by an Underwriter. If any one or more Underwriters shall fail to purchase and pay for any of the Securities agreed to be purchased by such Underwriter or Underwriters hereunder and such failure to purchase shall constitute a default in the performance of its or their obligations under this Agreement, the remaining Underwriters shall be obligated severally to take up and pay for (in the respective proportions which the principal amount of Securities set forth opposite their names in Schedule I hereto bears to the aggregate principal amount of Securities set forth opposite the names of all the remaining Underwriters) the Securities which the defaulting Underwriter or Underwriters agreed but failed to purchase; provided, however, that in the event that the aggregate principal amount of Securities which the defaulting Underwriter or Underwriters agreed but failed to purchase shall exceed 10% of the aggregate principal amount of Securities set forth in Schedule I hereto, the remaining Underwriters shall have the right to purchase all, but shall not be under any obligation to purchase any, of the Securities, and if such nondefaulting Underwriters do not purchase all the Securities, this Agreement will terminate without liability to any nondefaulting Underwriter or the Company. In the event of a default by any Underwriter as set forth in this Section 9, the Closing Date shall be postponed for such period, not exceeding five Business Days, as the Representatives shall determine in order that the required changes in the Registration Statement and the Final Prospectus or in any other documents or arrangements may be effected. Nothing contained in this Agreement shall relieve any defaulting Underwriter of its liability, if any, to the Company and any nondefaulting Underwriter for damages occasioned by its default hereunder.

Section 10. Termination. This Agreement may be terminated in the absolute discretion of the Representatives, by notice to the Company, if after the execution and delivery of this Agreement and prior to the Closing Date (i) trading generally shall have been suspended or materially limited on the New York Stock Exchange or the over-the-counter market, (ii) trading of any securities issued or guaranteed by the Company shall have been suspended on any exchange or in any over-the-counter market, (iii) a general moratorium or material disruption shall have occurred in commercial banking activities or securities settlement or clearance services in the United States or (iv) there shall have occurred any outbreak or escalation of hostilities or any change in the financial markets in the United States or the international financial markets or any calamity or crisis, either within or outside the United States, that, in the

 

19

judgment of the Representatives, makes it impracticable or inadvisable to proceed with the offering, sale or delivery of the Securities on the terms and in the manner contemplated by this Agreement and the Final Prospectus (exclusive of any amendment or supplement thereto).

Section 11. Representations and Indemnities to Survive. The respective agreements, representations, warranties, indemnities and other statements of the Company or its officers and of the Underwriters set forth in or made pursuant to this Agreement will remain in full force and effect, regardless of any investigation made by or on behalf of any Underwriter or the Company or any of the officers, directors, employees, agents or controlling persons referred to in Section 8 hereof, and will survive delivery of and payment for the Securities. The provisions of Sections 7 and 8 hereof shall survive the termination or cancellation of this Agreement.

Section 12. Notices. All notices and other communications hereunder shall be in writing and shall be deemed to have been duly given if mailed or transmitted and confirmed by any standard form of telecommunication. Notices to the Underwriters shall be given to the Underwriters c/o Merrill Lynch, Pierce, Fenner & Smith Incorporated, 50 Rockefeller Plaza, NY1-050-12-01, New York, New York 10020, Facsimile: (212) 901-7881, Attention: High Grade Debt Capital Markets Transaction Management / Legal; HSBC Securities (USA) Inc., 452 5th Avenue, New York, NY 10018, Facsimile: (212) 525-0238, Attention: Transaction Management Group; Wells Fargo Securities, LLC, 550 South Tryon Street, Charlotte, NC 28202, Facsimile: (704) 410-0326, Attention: Transaction Management; and U.S. Bancorp Investments, Inc. 214 N. Tryon St., 26th Floor, Charlotte, NC, 28202, Facsimile: (877) 774-3462, Attention: Investment Grade Syndicate. Notices to the Company shall be given to it at: The Valspar Corporation, 901 3rd Avenue South, Minneapolis, Minnesota 55402, Attention: Rolf Engh, fax: (612) 486-7979, telephone: (612) 851-7705.

Section 13. Successors. This Agreement will inure to the benefit of and be binding upon the parties hereto and their respective successors and the officers, directors, employees, agents and controlling persons referred to in Section 8 hereof, and no other person will have any right or obligation hereunder.

Section 14. No Fiduciary Duty. The Company acknowledges and agrees that the Underwriters are acting solely in the capacity of an arm’s length contractual counterparty to the Company with respect to the offering of Securities (including in connection with determining the terms of the offering) and not as a financial advisor or a fiduciary to, or an agent of, the Company or any other person. Additionally, no Underwriter is advising the Company or any other person as to any legal, tax, investment, accounting or regulatory matters in any jurisdiction. The Company shall consult with its own advisors concerning such matters and shall be responsible for making its own independent investigation and appraisal of the transactions contemplated hereby, and the Underwriters shall have no responsibility or liability to the Company with respect thereto. Any review by the Underwriters of the Company, the transactions contemplated hereby or other matters relating to such transactions will be performed solely for the benefit of the Underwriters and shall not be on behalf of the Company.

Section 15. Integration. This Agreement supersedes all prior agreements and understandings (whether written or oral) between the Company and the Underwriters, or any of them, with respect to the subject matter hereof.

 

20

Section 16. Applicable Law. This Agreement will be governed by and construed in accordance with the laws of the State of New York applicable to contracts made and to be performed within the State of New York.

Section 17. Waiver of Jury Trial. The Company hereby irrevocably waives, to the fullest extent permitted by applicable law, any and all right to trial by jury in any legal proceeding arising out of or relating to this Agreement or the transactions contemplated hereby.

Section 18. Counterparts. This Agreement may be signed in one or more counterparts, each of which shall constitute an original and all of which together shall constitute one and the same agreement.

Section 19. Headings. The section headings used herein are for convenience only and shall not affect the construction hereof.

Section 20. Definitions. The terms that follow, when used in this Agreement, shall have the meanings indicated.

“Act” shall mean the Securities Act of 1933, as amended and the rules and regulations of the Commission promulgated thereunder.

“Base Prospectus” shall mean the base prospectus referred to in paragraph 1(a) above contained in the Registration Statement at the Execution Time.

“Business Day” shall mean any day other than a Saturday, a Sunday or a legal holiday or a day on which banking institutions or trust companies are authorized or obligated by law to close in New York City.

“Commission” shall mean the Securities and Exchange Commission.

“Disclosure Package” shall mean (i) the Base Prospectus, (ii) the Preliminary Prospectus used most recently prior to the Execution Time, (iii) the Issuer Free Writing Prospectuses, if any, identified in Schedule III hereto, (iv) the final term sheet prepared and filed pursuant to Section 5(b) hereto, if any, and (v) any other Free Writing Prospectus that the parties hereto shall hereafter expressly agree in writing to treat as part of the Disclosure Package.

“Effective Date” shall mean each date and time that the Registration Statement and any post-effective amendment or amendments thereto became or becomes effective.

“Exchange Act” shall mean the Securities Exchange Act of 1934, as amended, and the rules and regulations of the Commission promulgated thereunder.

“Execution Time” shall mean 2:00 p.m. New York City time on the date hereof.

“Final Prospectus” shall mean the prospectus supplement relating to the Securities that was first filed pursuant to Rule 424(b) after the Execution Time, together with the Base Prospectus.

 

21

“Free Writing Prospectus” shall mean a free writing prospectus, as defined in Rule 405.

“Issuer Free Writing Prospectus” shall mean an issuer free writing prospectus, as defined in Rule 433.

“Preliminary Prospectus” shall mean any preliminary prospectus supplement to the Base Prospectus referred to in paragraph 1(a) above which is used prior to the filing of the Final Prospectus, together with the Base Prospectus.

“Registration Statement” shall mean the registration statement referred to in paragraph 1(a) above, including exhibits and financial statements and any prospectus supplement relating to the Securities that is filed with the Commission pursuant to Rule 424(b) and deemed part of such registration statement pursuant to Rule 430B, as amended on each Effective Date and, in the event any post-effective amendment thereto becomes effective prior to the Closing Date, shall also mean such registration statement as so amended.

“Rule 158,” “Rule 163,” “Rule 164,” “Rule 172,” “Rule 405,” “Rule 415,” “Rule 424,” “Rule 430B” and “Rule 433” refer to such rules under the Act.

“Trust Indenture Act” shall mean the Trust Indenture Act of 1939, as amended and the rules and regulations of the Commission promulgated thereunder.

“Well-Known Seasoned Issuer” shall mean a well-known seasoned issuer, as defined in Rule 405.

[Signatures appear on next page]

 

22

If the foregoing is in accordance with your understanding of our agreement, please sign and return to us the enclosed duplicate hereof, whereupon this letter and your acceptance shall represent a binding agreement among the Company and the several Underwriters.

 

Very truly yours,
THE VALSPAR CORPORATION
By:  

/s/ Tyler N. Treat

  Name:   Tyler N. Treat
  Title:   Vice President and Treasurer

 

[Signature Page to Underwriting Agreement]

The foregoing Agreement is hereby confirmed and accepted as of the date first set forth above
MERRILL LYNCH, PIERCE, FENNER & SMITH
                              INCORPORATED
HSBC SECURITIES (USA) INC.
WELLS FARGO SECURITIES, LLC
U.S. BANCORP INVESTMENTS, INC.
  As Representatives of the several underwriters
MERRILL LYNCH, PIERCE, FENNER & SMITH
                              INCORPORATED
By:  

/s/ Happy Hazelton

  Name:   Happy Hazelton
  Title:   Managing Director
HSBC SECURITIES (USA) INC.
By:  

/s/ Diane Kenna

  Name:   Diane Kenna
  Title:   Managing Director
WELLS FARGO SECURITIES, LLC
By:  

/s/ Carolyn Hurley

  Name:   Carolyn Hurley
  Title:   Director
U.S. BANCORP INVESTMENTS, INC.
By:  

/s/ Phil Bennett

  Name:   Phil Bennett
  Title:   Managing Director
For themselves and the other several Underwriters, if any, named in Schedule I to the foregoing Agreement.

 

[Signature Page to Underwriting Agreement]

SCHEDULE I

 

Underwriters

    Principal Amount
of Notes due 2026		  

Merrill Lynch, Pierce, Fenner & Smith

                      Incorporated

    $ 70,000,000   

HSBC Securities (USA) Inc.

      70,000,000   

Wells Fargo Securities, LLC

      70,000,000   

U.S. Bancorp Investments, Inc.

      70,000,000   

Deutsche Bank Securities Inc.

      12,250,000   

Mitsubishi UFJ Securities (USA), Inc.

      12,250,000   

Goldman, Sachs & Co.

      12,250,000   

Lloyds Securities Inc.

      12,250,000   

PNC Capital Markets LLC

      8,750,000   

ANZ Securities, Inc.

      6,125,000   

ING Financial Markets Inc.

      6,125,000   
  

 

 

  

Total

    $ 350,000,000   
  

 

 

  

 

I-1

SCHEDULE II

List of Significant Subsidiaries

Engineered Polymer Solutions, Inc.

Valspar Finance Corporation

Valspar Coatings Finance Corporation

Valspar Sourcing, Inc.

Valspar Credit Corporation

The Valspar (Asia) Corporation Limited

Guangdong Huarun Paints Company Limited

Valspar Coatings (Guangdong) Co., Ltd.

Valspar Yueda Coating (Foshan) Co., Ltd.

Valspar Paint (Australia) Pty Ltd.

Valspar Paint Services Pty Ltd.

Valspar Specialty Paints, LLC

 

II-1

SCHEDULE III

Schedule of Free Writing Prospectuses included in the Disclosure Package

None.

 

III-I

Exhibit A

Supplementing the Preliminary Prospectus

Supplement dated July 22, 2015

(To Prospectus dated January 15, 2015)

$350,000,000

The Valspar Corporation

3.950% Senior Notes due 2026

Final Term Sheet

July 22, 2015

 

Issuer:    The Valspar Corporation
Ratings (Moody’s / S&P):*    Baa2 (Stable) / BBB (Stable)
Type of Offering:    SEC Registered (No. 333-201521)
Trade Date:    July 22, 2015
Settlement Date (T+3):    July 27, 2015
Aggregate Principal Amount Offered:    $350,000,000
Maturity Date:    January 15, 2026
Interest Payment Dates:    Semi-annually on January 15 and July 15, beginning on January 15, 2016
Coupon (Interest Rate):    3.950% per annum
Price to Public (Issue Price):    99.560% of principal amount
Yield to Maturity:    4.002%
Benchmark Treasury:    UST 2.125% due May 15, 2025
Benchmark Treasury Price / Yield:    98-09 /2.322%
Spread to Benchmark Treasury:    1.68% (168 basis points)
Optional Redemption:   

The Notes will be redeemable at the Issuer’s option, at any time in whole or from time to time in part, prior to October 15, 2025 (three months prior to the maturity date of the Notes), at a redemption price equal to (A) the greater of (i) 100% of the principal amount of such Notes and (ii) the sum of the present values of the remaining scheduled payments of principal and interest (exclusive of interest accrued to the date of redemption) on such Notes discounted to the redemption date on a semi-annual basis at the Treasury Rate plus 0.25% (25 basis points), plus (B) accrued and unpaid interest to (but excluding) the redemption date.

 

At any time on or after October 15, 2025 (three months prior to the maturity date of the Notes), the Notes will be redeemable, at any time in whole or from time to time in part, at the Issuer’s option at par plus accrued and unpaid interest thereon to but excluding the redemption date.

Change of Control Offer:    If a “change of control repurchase event” occurs, the Issuer will be required, subject to certain conditions, to offer to repurchase the Notes at a purchase price equal to 101% of the principal amount, plus accrued and unpaid interest to the repurchase date (all as described in the Issuer’s Preliminary Prospectus Supplement dated July 22, 2015 relating to the Notes).
Denominations:    $2,000 x $1,000
Joint Book-Running Managers:   

Merrill Lynch, Pierce, Fenner & Smith

                     Incorporated

HSBC Securities (USA) Inc.

U.S. Bancorp Investments, Inc.

Wells Fargo Securities, LLC

Co-Managers:   

Deutsche Bank Securities Inc.

Mitsubishi UFJ Securities (USA), Inc.

 

A-1

  

Goldman, Sachs & Co.

Lloyds Securities Inc.

Junior Managers:   

PNC Capital Markets LLC

ANZ Securities, Inc.

ING Financial Markets Inc.

CUSIP / ISIN Number:    920355 AK0/US920355AK06

 

* Note: A securities rating is not a recommendation to buy, sell or hold securities and may be subject to revision or withdrawal at any time.

The issuer has filed a registration statement (including a prospectus) with the Securities Exchange Commission (“SEC”) for the offering to which this communication relates. Before you invest, you should read the prospectus in that registration statement and other documents the Issuer has filed with the SEC for more complete information about the Issuer and this offering. You may get these documents for free by visiting the SEC website at www.sec.gov. Alternatively, the Issuer, or any underwriter or any dealer participating in the offering, will arrange to send you the prospectus if you request it by calling or e-mailing Merrill Lynch, Pierce, Fenner & Smith Incorporated toll-free at (800) 294-1322 or dg.prospectus_requests@baml.com, by calling HSBC Securities (USA) Inc. toll-free at (866) 811-8049, by calling U.S. Bancorp Investments, Inc. toll-free at (877) 558-2607 or by calling or e-mailing Wells Fargo Securities, LLC at 1-800-645-3751 or wfscustomerservice@wellsfargo.com.

 

A-2

Exhibit B

[Form of Opinion of Rolf Engh, Esq.]

1. The Company has been duly incorporated and is validly existing as a corporation in good standing under the laws of the State of Delaware and has corporate power and authority to own, lease and operate its properties and to conduct its business as described in the Disclosure Package and the Final Prospectus. The Company is in good standing in each jurisdiction in which the ownership or lease of its property or the conduct of its businesses requires such qualification, except where the failure to be so qualified or in good standing or have such power or authority would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

2. Each of the Significant Subsidiaries of the Company has been duly incorporated and is validly existing as a corporation in good standing under the laws of the jurisdiction of its incorporation and has corporate power and authority to own, lease and operate its properties and to conduct its business as described in the Disclosure Package and the Final Prospectus, except where any failure would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. All the outstanding shares of capital stock of each Significant Subsidiary of the Company have been duly and validly authorized and issued and are fully paid and non-assessable, and (except (i) as otherwise set forth in the Disclosure Package and the Final Prospectus or (ii) in the case of any foreign subsidiary, with respect to directors’ qualifying shares) all outstanding shares of capital stock of the Significant Subsidiaries of the Company are owned by the Company either directly or through wholly owned subsidiaries free and clear of any perfected security interest and, to the knowledge of such counsel, after due inquiry, any other security interest, claim, lien or encumbrance.

3. The Company’s authorized equity capitalization is as set forth in the Disclosure Package and the Final Prospectus.

4. The issue and sale of the Securities by the Company, and the execution, delivery and performance by the Company of the Underwriting Agreement and the Indenture will not breach or result in a default under any material indenture, mortgage, deed of trust, loan agreement or other agreement or instrument to which the Company or any of its subsidiaries is a party or by which the Company or any of its subsidiaries is bound or to which any of the property or assets of the Company or any of its subsidiaries is subject, nor will such action violate the certificate of incorporation or by-laws of the Company.

5. The issue and sale of the Securities by the Company, and the execution, delivery and performance by the Company of the Underwriting Agreement and the Indenture will not violate any order known to such counsel issued pursuant to any federal or Minnesota law, statute or the Delaware General Corporation Law by any court or governmental agency or body having jurisdiction over the Company or any of its subsidiaries or any of their properties.

6. There is no pending or, to my knowledge, threatened action, suit or proceeding by or before any court or governmental agency, authority or body or any arbitrator involving the Company or any of its subsidiaries or its or their property that is not adequately disclosed in the

 

B-1

Disclosure Package and the Final Prospectus, except in each case for such proceedings that, if the subject of an unfavorable decision, ruling or finding would not, singly or in the aggregate, have a Material Adverse Effect.

7. To my knowledge, (a) there are no statutes or pending or threatened legal or governmental proceedings that are required to be described in the Registration Statement that are not described as required in the Disclosure Package and the Final Prospectus, and (b) there is no contract or other document of a character required to be described in the Registration Statement or Final Prospectus, or to be filed as an exhibit thereto, which is not described or filed as required.

In addition, such counsel or deputy counsel shall state that he has participated in conferences with officers and other representatives of the Company, its outside counsel and accountants and representatives of the Underwriters and their counsel, at which conferences he discussed the contents of the Registration Statement, the Disclosure Package and the Final Prospectus, and related matters and, although he is not passing upon and does not assume any responsibility for the accuracy, completeness or fairness of the statements contained in the Registration Statement, the Disclosure Package and the Final Prospectus, on the basis of the foregoing, no facts have come to his attention that lead him to believe that (i) the Registration Statement, at the most recent time of effectiveness with respect to the Underwriters as determined pursuant to Rule 430B, contained an 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 therein not misleading; (ii) the Final Prospectus, as of its date or at the Closing Date contained an untrue statement of a material fact or omitted to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading; or (iii) the Disclosure Package, as of the Execution Time, contained any untrue statement of a material fact or omitted to state any material fact necessary in order to make the statements therein, in the light of circumstances under which they were made, not misleading (except that such counsel in such statement need express no view as to (i) financial statements, financial statement schedules and other financial information therein or (ii) that part of the Registration Statement that constitutes the Statement of Eligibility (Form T-1) under the Trust Indenture Act of the Trustee).

 

B-2

Exhibit C

[Form of Opinion of Maslon LLP]

1. The Underwriting Agreement has been duly authorized, executed and delivered by the Company.

2. The Indenture has been duly authorized, executed and delivered by the Company and, assuming that the Indenture has been duly authorized, executed and delivered by the Trustee, constitutes a valid and legally binding obligation of the Company enforceable against the Company in accordance with its terms, subject to applicable bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium or similar laws affecting the enforcement of creditors’ rights or remedies generally and by equitable principles relating to enforceability, including principles of good faith and fair dealing (regardless of whether enforcement is sought in a proceeding at law or in equity) (collectively, the “Enforceability Exceptions”). The Indenture has been qualified under the Trust Indenture Act.

3. The Securities have been duly authorized, executed and delivered by the Company and, assuming due authentication thereof by the Trustee, constitute valid and legally binding obligations of the Company enforceable against the Company in accordance with their terms and entitled to the benefits of the Indenture, subject to the Enforceability Exceptions.

4. The issue and sale of the Securities by the Company, and the execution, delivery and performance by the Company of the Underwriting Agreement and the Indenture, will not violate any federal, New York (assuming that New York law is the same as Minnesota law) or Minnesota law or statute or the Delaware General Corporation Law or any rule or regulation that has been issued pursuant to any federal, New York (assuming that New York law is the same as Minnesota law) or Minnesota law, statute or the Delaware General Corporation Law.

5. No consent, approval, authorization, order, registration or qualification of or with any U.S. federal, New York (assuming that New York law is the same as Minnesota law), Minnesota or Delaware governmental agency or body is required for the issue and sale of the Securities by the Company, and the compliance by the Company with all of the provisions of the Underwriting Agreement and the Indenture, except for such consents, approvals, authorizations, registrations or qualifications as may be required under state securities or Blue Sky laws in connection with the issue and sale of the Securities by the Company and the purchase and distribution of the Securities by the Underwriters.

6. The Company is not, and after giving effect to the offering and sale of the Securities and the application of the proceeds thereof as described in the Disclosure Package and the Final Prospectus, will not be, an “investment company” within the meaning of the Investment Company Act of 1940, as amended, and the rules and regulations of the Commission thereunder.

7. The statements made in the Disclosure Package and the Final Prospectus under the captions “Description of the Notes” and “Description of Debt Securities,” insofar as they

 

C-1

purport to constitute summaries of certain terms of documents referred to therein, constitute accurate summaries of the terms of such documents in all material respects.

8. The documents incorporated by reference into the Disclosure Package and the Final Prospectus, when filed with the Commission, complied as to form in all material respects with the requirements of the Exchange Act.

9. The Registration Statement has become effective under the Act; any required filing of the Base Prospectus, any Preliminary Prospectus and the Final Prospectus, and any supplements thereto, pursuant to Rule 424(b) has been made in the manner and within the time period required by Rule 424(b); and to the knowledge of such counsel, no stop order suspending the effectiveness of the Registration Statement or any notice objecting to its use has been issued, and no proceedings for that purpose have been instituted or threatened.

10. The Registration Statement and the Final Prospectus (other than (i) the financial statements, financial statement schedules and other financial information contained therein, as to which such counsel need express no opinion and (ii) that part of the Registration Statement that constitutes the Statement of Eligibility (Form T-1) under the Trust Indenture Act of the Trustee) comply as to form in all material respects with the applicable requirements of the Act and the Trust Indenture Act and the respective rules thereunder.

In addition, such counsel shall state that they have participated in conferences with officers and other representatives of the Company, and representatives of the independent public accountants for the Company and representatives of the Underwriters and their counsel at which conferences they made inquiries of such officers, representatives and accountants and discussed the contents of the Registration Statement, the Disclosure Package and the Final Prospectus, and related matters and, although they are not passing upon and do not assume any responsibility for the accuracy, completeness or fairness of the statements contained in the Registration Statement, the Disclosure Package or the Final Prospectus except as set forth in paragraph 7 above, on the basis of the foregoing, no facts have come to their attention that lead them to believe that (i) the Registration Statement, at the most recent time of effectiveness with respect to the Underwriters as determined pursuant to Rule 430B, contained an 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 therein not misleading; (ii) the Final Prospectus, as of its date or at the Closing Date contained an untrue statement of a material fact or omitted to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading; or (iii) the Disclosure Package, as of the Execution Time, contained any untrue statement of a material fact or omitted to state any material fact necessary in order to make the statements therein, in the light of circumstances under which they were made, not misleading (except that such counsel in such statement need express no view as to (i) financial statements, financial statement schedules and other financial information therein or (ii) that part of the Registration Statement that constitutes the Statement of Eligibility (Form T-1) under the Trust Indenture Act of the Trustee).

 

C-2



Exhibit 4.2

 

 

THE VALSPAR CORPORATION

$350,000,000 3.950% Notes due 2026

SIXTH SUPPLEMENTAL INDENTURE

Dated as of July 27, 2015

to

Indenture Dated as of April 24, 2002

U.S. BANK NATIONAL ASSOCIATION

Series Trustee

and

THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A

(as successor to Bank One Trust Company, N.A.)

Original Trustee

 

 

SIXTH SUPPLEMENTAL INDENTURE (this “Sixth Supplemental Indenture”), dated as of July 27, 2015, between THE VALSPAR CORPORATION, a Delaware corporation (the “Company”), U.S. Bank National Association, (the “Series Trustee”), and The Bank of New York Mellon Trust Company, N.A. (as successor to Bank One Trust Company, N.A.) (the “Original Trustee,” and together with the Series Trustee, the “Trustee”).

RECITALS

WHEREAS, the Company has heretofore executed and delivered to the Original Trustee an Indenture dated as of April 24, 2002 (the “Existing Indenture” and, together with the First Supplemental Indenture dated as of April 30, 2002, the Second Supplemental Indenture dated as of April 17, 2007, the Third Supplemental Indenture dated as of June 19, 2009, the Fourth Supplemental Indenture, dated as of January 13, 2012, the Fifth Supplemental Indenture, dated as of January 21, 2015 and this Sixth Supplemental Indenture, the “Indenture”) providing for the issuance by the Company from time to time of its debt securities to be issued in one or more series;

WHEREAS, the Company, in the exercise of the power and authority conferred upon and reserved to it under the provisions of the Existing Indenture and pursuant to appropriate resolutions of the Board of Directors, has duly determined to make, execute and deliver to the Series Trustee this Sixth Supplemental Indenture to the Existing Indenture in order to issue a new series of debt securities to be designated as the “3.950% Notes due 2026” (the “Notes”), and to set forth the respective terms that will be applicable thereto and the form thereof;

WHEREAS, the Company has duly determined to appoint U.S. Bank National Association as Series Trustee, Security Registrar and Paying Agent under the Indenture with respect to the Notes (but only with respect to the Notes) and U.S. Bank National Association is willing to accept such appointment with respect to the Notes;

WHEREAS, the Company is entering into this Sixth Supplemental Indenture with the Original Trustee and the Series Trustee to evidence and provide for the acceptance of appointment thereunder by the Series Trustee with respect to the Notes (but only with respect to the Notes), to add to or change any of the provisions of the Existing Indenture as shall be necessary to provide for or facilitate the administration of the trusts thereunder by more than one Trustee, to make certain amendments to the Existing Indenture pursuant to Section 901(2) of the Existing Indenture to expressly permit the appointment of the Series Trustee as Trustee for the Notes (but only with respect to the Notes), and to make certain other amendments to the Existing Indenture;

WHEREAS, the Company has requested that the Original Trustee enter into this Sixth Supplemental Indenture in connection with (i) the foregoing amendments and (ii) the Company’s appointment of the Series Trustee with all of the rights, powers, trusts, duties and obligations of Trustee, Security Registrar and Paying Agent with respect to the Notes (but only with respect to the Notes);

WHEREAS, Sections 201, 301 and 901 of the Existing Indenture provide, among other things, that the Company and the Trustee may, without the consent of Holders, enter into indentures supplemental to the Existing Indenture to provide for specific terms applicable to any

 

2

series of notes and to add to the covenants of the Company for the benefit of the Holders of each series of notes (and if such covenants are to be for the benefit of less than all series of notes, stating that such covenants are expressly being included solely for the benefit of such series); and

WHEREAS, all things necessary to make the Notes, when executed by the Company and authenticated and delivered by the Series Trustee or any Authenticating Agent and issued upon the terms and subject to the conditions set forth hereinafter and in the Indenture against payment therefor, the valid, binding and legal obligations of the Company and to make this Sixth Supplemental Indenture a valid, binding and legal agreement of the Company, have been done;

NOW, THEREFORE, in consideration of the premises and for other good and valuable consideration, the sufficiency and adequacy of which are hereby acknowledged, the parties hereto hereby agree as follows:

ARTICLE I

APPLICATION OF SUPPLEMENTAL INDENTURE

AND CREATION OF NOTES

Section 1.01 Application of this Sixth Supplemental Indenture.

Notwithstanding any other provision of this Sixth Supplemental Indenture, the provisions of this Sixth Supplemental Indenture, including the covenants and Events of Default set forth herein, are expressly and solely for the benefit of the Notes. The Notes constitute a separate series of notes as provided in Section 301 of the Existing Indenture.

Section 1.02 Effect of this Sixth Supplemental Indenture.

With respect to the Notes only, the Existing Indenture shall be supplemented pursuant to Sections 201, 301 and 901 thereof to establish the terms of the Notes as set forth in this Sixth Supplemental Indenture, including as follows:

 

  (a) The definitions set forth in Article One of the Existing Indenture shall be modified to the extent provided in Article II of this Sixth Supplemental Indenture;

 

  (b) The form and terms of the securities representing the Notes required to be established pursuant to Sections 201 and 301 of the Existing Indenture shall be established in accordance with Sections 1.03, 1.04, 1.05, 1.06 and 1.07 of this Sixth Supplemental Indenture;

 

  (c) Sections 501(1), (6) and (7) of the Existing Indenture regarding certain events of default are deleted as contemplated by Section 301(12) of the Existing Indenture and replaced in their entirety by Section 5.01 of this Sixth Supplemental Indenture.

 

  (d) The provisions of Article Ten of the Existing Indenture regarding certain covenants of the Company shall be supplemented and amended by the provisions of Article VI of this Sixth Supplemental Indenture.

 

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  (e) Section 901 of the Existing Indenture regarding the entering into of supplemental indentures without the consent of Holders shall be amended by inserting therein a new Section 901(8) of the Existing Indenture (as set forth in Section 8.01 of this Sixth Supplemental Indenture).

 

  (f) Section 901(6) of the Existing Indenture regarding the appointment of a successor Trustee by entering into of supplemental indentures without the consent of Holders shall be amended and replaced in its entirety by Section 8.02 of this Sixth Supplemental Indenture.

Section 1.03 Designation and Amount of Notes.

The Notes shall be known and designated as the “3.950% Notes due 2026.” The initial maximum aggregate principal amount of the Notes that may be authenticated and delivered under this Sixth Supplemental Indenture shall not exceed $350,000,000, except for Notes authenticated and delivered upon registration or transfer of, or in exchange for, or in lieu of, Notes pursuant to Sections 202, 304, 305, 306 or 905 of the Existing Indenture (unless the Notes are “reopened” pursuant to Section 901(8) of the Existing Indenture (as set forth in Section 8.01 of this Sixth Supplemental Indenture) by issuing additional Notes of such series (the “Additional Notes”), in an amount or amounts and registered in the names of such Persons as shall be set forth in any written order of the Company for the authentication and delivery of the Notes pursuant to Section 303 of the Existing Indenture).

Section 1.04 Terms; Form of Security.

The Notes and the Additional Notes shall constitute one series for purposes of the Existing Indenture and this Sixth Supplemental Indenture, including, without limitation, waivers, amendments, redemptions and offers to purchase. The Company shall issue any additional notes of a series by adopting a Board Resolution in the manner set forth in Section 301 of the Existing Indenture providing for the terms of such issuance. Notwithstanding the foregoing, the Notes are issuable in fully registered form as Global Notes (unless otherwise permitted by Section 202 of the Existing Indenture) without coupons and shall be in substantially the form of Exhibit A. The Notes are not issuable in bearer form. The terms and provisions contained in the form of Note shall constitute, and are hereby expressly made, a part of this Sixth Supplemental Indenture and the Company, by its execution and delivery of this Sixth Supplemental Indenture, expressly agrees to such terms and provisions and to be bound thereto. Any of the Notes may have such letters, numbers or other marks of identification and such notations, legends and endorsements as the officers executing the same may approve (execution thereof to be conclusive evidence of such approval) and are not inconsistent with the provisions of the Indenture (and which do not affect the rights, duties or immunities of the Series Trustee), or as may be required to comply with any law or with any rule or regulation made pursuant thereto or with any rule or regulation of any securities exchange or automated quotation system on which the Notes may be listed.

Section 1.05 Payment of Principal and Interest.

(a) The Notes shall mature, and the principal of the Notes shall be due and payable in U.S. Dollars to the Holders thereof, together with all accrued and unpaid interest thereon, on January 15, 2026 (the Stated Maturity of principal of the Notes).

 

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(b) The Notes shall bear interest at 3.950% per annum from and including July 27, 2015, or from the most recent Interest Payment Date (defined below) on which interest has been paid or provided for until the principal thereof becomes due and payable, and on any overdue principal and (to the extent that payment of such interest is enforceable under applicable law) on any overdue installment of interest at the same rate per annum. Interest shall be calculated on the basis of a 360-day year comprised of twelve 30-day months. Interest on the Notes shall be payable semi-annually in arrears in U.S. Dollars on January 15 and July 15 of each year, commencing on January 15, 2016 (each such date, an “Interest Payment Date” for the purposes of the Notes under this Sixth Supplemental Indenture). Payments of interest shall be made to the Person in whose name a Note (or predecessor Note) is registered (which shall initially be the Depositary) at the close of business on the January 1 or July 1, as the case may be, next preceding such Interest Payment Date (each such date, a “Regular Record Date” for the purposes of the Notes under this Sixth Supplemental Indenture).

(c) For so long as the Notes are represented by one or more Global Notes, all payments of principal and interest shall be made by the Company by wire transfer of immediately available funds in U.S. Dollars to the Depositary or its nominee, as the case may be, as the registered owner of the Global Notes representing such Notes. In the event that definitive Notes shall have been issued, all payments of principal and interest shall be made by the Company by wire transfer of immediately available funds in U.S. Dollars to the accounts of the registered Holders thereof; provided, that the Company may elect to make such payments at the office of the Paying Agent in The City of New York; and provided further, that the Company may at its option pay interest by check to the registered address of each Holder of a definitive Note.

(d) The Notes shall trade in the Depositary’s Same-Day Funds Settlement System until Stated Maturity (or until they are subject to acceleration pursuant to Article V of the Existing Indenture) and secondary market trading activity in the Notes may be required by the Depositary to settle in immediately available funds.

(e) The Notes are subject to redemption by the Company in whole or in part in the manner described herein.

Section 1.06 Ranking.

The Notes shall be general unsecured obligations of the Company. The Notes shall rank pari passu in right of payment with all unsecured and unsubordinated indebtedness of the Company and senior in right of payment to all subordinated indebtedness of the Company.

Section 1.07 Sinking Fund

The Notes are not subject to any sinking fund.

ARTICLE II

DEFINITIONS AND INCORPORATION BY REFERENCE

 

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Section 2.01 Definitions.

(a) All capitalized terms used herein and not otherwise defined below shall have the meanings ascribed thereto in the Existing Indenture.

(b) The following are definitions used in this Sixth Supplemental Indenture and to the extent that a term is defined both herein and in the Existing Indenture, the definition in this Sixth Supplemental Indenture shall govern with respect to the Notes.

“Attributable Debt” for a lease means, as of the date of determination, the present value of net rent for the remaining term of the lease. Rent shall be discounted to present value at a discount rate that is compounded semi-annually. The discount rate shall be 10% per annum or, if the Company elects, the discount rate shall be equal to the weighted average Yield to Maturity of the Notes. Such average shall be weighted by the principal amount of the Notes then outstanding. Rent is the lesser of (a) rent for the remaining term of the lease assuming it is not terminated, or (b) rent from the date of determination until the first possible termination date plus the termination payment then due, if any. The remaining term of a lease includes any period for which the lease has been extended. Rent does not include (1) amounts due for maintenance, repairs, utilities, insurance, taxes, assessments and similar charges, or (2) contingent rent, such as that based on sales. Rent may be reduced by the discounted present value of the rent that any sublessee must pay from the date of determination for all or part of the same property. If the net rent on a lease is not definitely determinable, the Company may estimate it in any reasonable manner.

“Below Investment Grade Rating Event” means the Notes are rated below Investment Grade by both Rating Agencies on any date from the date of the public notice of an arrangement that could result in a Change of Control until the end of the 60-day period following public notice of the occurrence of a Change of Control (which period shall be extended so long as the rating of such Notes is under publicly announced consideration for possible downgrade by either of the Rating Agencies); provided that a Below Investment Grade Rating Event otherwise arising by virtue of a particular reduction in rating shall not be deemed to have occurred in respect of a particular Change of Control (and thus shall not be deemed a Below Investment Grade Rating Event for purposes of the definition of Change of Control Repurchase Event) if the Rating Agencies making the reduction in rating to which this definition would otherwise apply do not announce or publicly confirm or inform the Series Trustee in writing at the request of the Company that the reduction was the result, in whole or in part, of any event or circumstance comprised of or arising as a result of, or in respect of, the applicable Change of Control (whether or not the applicable Change of Control shall have occurred at the time of the Below Investment Grade Rating Event).

“Change of Control” means the consummation of any transaction (including, without limitation, any merger or consolidation) the result of which is that any “person” (as that term is used in Section 13(d)(3) of the Exchange Act) becomes the beneficial owner, directly or indirectly, of more than 50% of the Voting Stock of the Company, measured by voting power rather than number of shares. Notwithstanding the foregoing, a transaction will not be deemed to involve a Change of Control if (1) the Company becomes a wholly owned subsidiary of a holding company and (2) the holders of the Voting Stock of such holding company immediately following that

 

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transaction are substantially the same as the holders of the Company’s Voting Stock immediately prior to that transaction.

“Change of Control Repurchase Event” means the occurrence of both a Change of Control and a Below Investment Grade Rating Event.

“Comparable Treasury Issue” means the United States Treasury security selected by the Quotation Agent as having a maturity comparable to the remaining term of the Notes to be redeemed that would be utilized, at the time of selection and in accordance with customary financial practice, in pricing new issues of corporate debt securities of comparable maturity to the remaining term of such Notes.

“Comparable Treasury Price” means, with respect to any redemption date, (i) the average of four Reference Treasury Dealer Quotations for such redemption date, after excluding the highest and lowest such Reference Treasury Dealer Quotations, or (ii) if the Series Trustee obtains fewer than four such Reference Treasury Dealer Quotations, the average of all such quotations, or (iii) if only one Reference Treasury Dealer Quotation is received, such quotation.

“Consolidated Total Assets” means total consolidated assets as reflected in the Company’s most recent consolidated balance sheet preceding the date of a determination under Section 6.01(i) of this Sixth Supplemental Indenture.

“Control,” as used with respect to any Person, means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of such Person, whether through the ownership of voting securities, by agreement or otherwise. For purposes of this definition, the terms “controlling,” “controlled by” and “under common control with” have correlative meanings.

“Debt” means any debt for borrowed money or any guarantee of such debt.

“Government Securities” means direct obligations of the United States for the payment of which its full faith and credit is pledged, or obligations of a Person controlled or supervised by and acting as an agency or instrumentality of the United States the timely payment of which is unconditionally guaranteed as a full faith and credit obligation by the United States.

“Investment Grade” means a rating of Baa3 or better by Moody’s (or its equivalent under any successor rating categories of Moody’s); a rating of BBB- or better by S&P (or its equivalent under any successor rating categories of S&P); or the equivalent investment grade credit rating from any additional Rating Agency or Rating Agencies selected by the Company.

“Lien” means any mortgage, pledge, security interest or lien to secure or assure payment of Debt.

“Moody’s” means Moody’s Investors Service, Inc.

“Long-Term Debt” means Debt that by its terms matures on a date more than 12 months after the date it was created or Debt that the obligor may extend or renew without the obligee’s consent to a date more than 12 months after the date the Debt was created.

 

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“Officer” means the Chief Executive Officer, the President, the Chief Financial Officer, any Executive or Senior Vice President or the Principal Accounting Officer (so long as such Principal Accounting Officer is at least a Vice President) of the Company.

“Principal Property” means (i) any manufacturing facility, whether now or hereafter owned, located in the United States (excluding territories and possessions other than Puerto Rico), except any such facility that in the opinion of the board of directors of the Company or any authorized committee of such board is not of material importance to the total business conducted by the Company and its consolidated Subsidiaries, and (ii) any shares of stock of a Restricted Subsidiary.

“Quotation Agent” means the Reference Treasury Dealer appointed by the Company.

“Reference Treasury Dealer” means (i) Merrill Lynch Pierce, Fenner & Smith Incorporated and HSBC Securities (USA) Inc. and their respective successors (provided, however, that if any such firm or successor, as the case may be, ceases to be a primary U.S. Government securities dealer in the United States (a “Primary Treasury Dealer”), the Company shall substitute therefor another Primary Treasury Dealer), (ii) one Primary Treasury Dealer selected by U.S. Bancorp Investments, Inc. or its successor, (iii) one Primary Treasury Dealer selected by Wells Fargo Securities, LLC or its successor, and (iv) any other Primary Treasury Dealers selected by the Company.

“Rating Agency” means (1) each of Moody’s and S&P; and (2) if either of Moody’s or S&P ceases to rate the Notes or fails to make a rating of the Notes publicly available for reasons outside of the Company’s control, a “nationally recognized statistical rating organization” as defined in Section 3(a)(62) of the Exchange Act, selected by the Company (as certified by a resolution of the Company’s Board of Directors) as a replacement agency for Moody’s or S&P, or both, as the case may be.

“Reference Treasury Dealer Quotations” means, with respect to each Reference Treasury Dealer and any redemption date, the average, as determined by the Series Trustee, of the bid and asked prices for the Comparable Treasury Issue (expressed in each case as a percentage of its principal amount) quoted in writing to the Series Trustee by such Reference Treasury Dealer at 5:00 p.m., New York City time, on the third business day preceding such redemption date.

“Restricted Subsidiary” means a Wholly-Owned Subsidiary that has substantially all of its assets located in the United States (excluding territories or possessions other than Puerto Rico) and owns a Principal Property.

“S&P” means Standard & Poor’s Ratings Services, a division of The McGraw-Hill Companies, Inc.

“Sale-Leaseback Transaction” means an arrangement pursuant to which the Company or a Restricted Subsidiary now owns or hereafter acquires a Principal Property, transfers it to a person, and leases it back from the person.

 

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“Treasury Rate” means, with respect to any redemption date, the rate per annum equal to the semi-annual equivalent yield to maturity of the Comparable Treasury Issue, assuming a price for the Comparable Treasury Issue (expressed as a percentage of its principal amount) equal to the Comparable Treasury Price for such redemption date.

“Voting Stock” of any specified “person” (as that term is used in Section 13(d)(3) of the Exchange Act) as of any date means the capital stock or other equity interest of such person that is at the time entitled to vote generally in the election of the board of directors or equivalent body of such person.

“Wholly-Owned Subsidiary” of any specified Person means a corporation all of whose Voting Stock is owned by the Company or a Wholly-Owned Subsidiary, the accounts of which are consolidated with those of the Company in its consolidated financial statements.

“Yield to Maturity” means the yield to maturity on a security at the time of its issuance or at the most recent determination of interest on the security.

Section 2.02 Other Definitions.

 

Term

       

Defined in Section

“Additional Notes”      1.03

Section 2.03 Incorporation by Reference of Trust Indenture Act.

The Indenture is subject to the mandatory provisions of the Trust Indenture Act, which are incorporated by reference in and made a part of the Indenture. The following Trust Indenture Act terms have the following meanings:

“indenture securities” means the Notes.

“indenture security holder” means a Holder.

“indenture to be qualified” means this Sixth Supplemental Indenture.

“indenture trustee” or “institutional trustee” means the Series Trustee.

“obligor” on the indenture securities means the Company and any other obligor on the indenture securities.

All other Trust Indenture Act terms used in this Indenture that are defined by the Trust Indenture Act, defined by Trust Indenture Act reference to another statute or defined by Commission rule have the meanings assigned to them by such definitions.

ARTICLE III

REDEMPTION

 

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Section 3.01 Optional Redemption.

The Notes are subject to redemption, in whole or in part, on any date prior to October 15, 2025, at the Company’s option at a Redemption Price equal to the greater of:

 

  (i) 100% of the principal amount of the Notes to be redeemed, and

 

  (ii) as determined by the Quotation Agent, the sum of the present values of the remaining scheduled payments of principal and interest in respect of the Notes to be redeemed (not including any portion of those payments of interest accrued as of the date of redemption) discounted to the date of redemption on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months) at the Treasury Rate plus 25 basis points,

plus accrued and unpaid interest to the redemption date.

In addition, at any time on or after October 15, 2025, (three months prior to the stated maturity), the Company may also redeem some or all of the Notes at its option, at a Redemption Price equal to 100% of the principal amount of the Notes being redeemed plus accrued and unpaid interest to the redemption date.

The Company may provide in the redemption notice described in Section 3.04 herein that payment of such Redemption Price and performance of the Company’s obligations with respect to such redemption or purchase may be performed by another Person. Any such notice may, at the Company’s discretion, be subject to the satisfaction of one or more conditions precedent.

Section 3.02 Notices to Series Trustee.

If the Company elects to redeem the Notes pursuant to this Article, it shall notify the Series Trustee in writing of the redemption date and the principal amount of the Notes to be redeemed.

The Company shall give each notice to the Series Trustee provided for in this Section at least 35 days but not more than 60 days before the redemption date unless the Series Trustee consents to a shorter period. Such notice shall be accompanied by an Officers’ Certificate and an Opinion of Counsel from the Company to the effect that such redemption will comply with the conditions herein. If fewer than all the Notes are to be redeemed, the record date relating to such redemption shall be selected by the Company and given to the Series Trustee, which record date shall be not fewer than 15 days after the date of notice to the Series Trustee. Any such notice may be canceled at any time prior to notice of such redemption being mailed to any Holder and shall thereby be void and of no effect.

Section 3.03 Selection of Notes To Be Redeemed.

If fewer than all the Notes are to be redeemed, the Series Trustee shall select the Notes to be redeemed pro rata or by lot or by a method that complies with applicable legal and securities exchange requirements, if any, and that the Series Trustee in its sole discretion shall deem to be fair and appropriate and in accordance with methods generally used at the time of selection by fiduciaries in similar circumstances. The Series Trustee shall make the selection from outstanding

 

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Notes not previously called for redemption. The Series Trustee may select for redemption portions of the principal of the Notes that have denominations equal to $2,000 or an integral multiple of $1,000 in excess thereof. The Notes and portions of them the Series Trustee selects shall be in amounts of $2,000 or an integral multiple of $1,000 in excess therof. Provisions of this Sixth Supplemental Indenture that apply to the Notes called for redemption also apply to portions of the Notes called for redemption. The Series Trustee shall notify the Company promptly of the Notes or portions of the Notes to be redeemed.

Section 3.04 Notice of Redemption.

At least 30 days but not more than 60 days before a date for redemption of Notes, the Company shall mail a notice of redemption by first-class mail to each Holder of the Notes to be redeemed at such Holder’s registered address.

The notice shall identify the Notes to be redeemed and shall state:

(a) the redemption date;

(b) the calculation of the redemption price and the amount of accrued interest to the redemption date;

(c) the name and address of the Paying Agent;

(d) that the Notes called for redemption must be surrendered to the Paying Agent to collect the redemption price;

(e) if fewer than all the outstanding the Notes are to be redeemed, the certificate numbers and principal amounts of the particular the Notes to be redeemed;

(f) that, unless the Company defaults in making such redemption payment or the Paying Agent is prohibited from making such payment pursuant to the terms of this Indenture, interest on the Notes (or portion thereof) called for redemption ceases to accrue on and after the Redemption Date;

(g) the CUSIP number, if any, printed on the Notes being redeemed; and

(h) that no representation is made as to the correctness or accuracy of the CUSIP number, if any, listed in such notice or printed on the Notes.

At the Company’s request, the Series Trustee shall give the notice of redemption in the Company’s name and at the Company’s expense. In such event, the Company shall provide the Series Trustee with the information required by this Section.

Section 3.05 Effect of Notice of Redemption.

Once notice of redemption is mailed, the Notes called for redemption become due and payable on the Redemption Date and at the redemption price stated in the notice. Upon surrender to the Paying Agent, such Notes shall be paid at the redemption price stated in the notice, plus

 

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accrued and unpaid interest, if any, to the redemption date; provided, however, that if the redemption date is after a Regular Record Date and on or prior to the Interest Payment Date, the accrued interest shall be payable to the holder of the Notes registered on the relevant Regular Record Date. Failure to give notice or any defect in the notice to any Holder shall not affect the validity of the notice to any other Holder.

Section 3.06 Deposit of Redemption Price.

Prior to 11:00 a.m. New York City time on the redemption date, the Company shall deposit with the Paying Agent (or, if the Company or a Subsidiary is the Paying Agent, shall segregate and hold in trust) money sufficient to pay the redemption price of and accrued interest on all Notes to be redeemed on that date other than the Notes or portions of the Notes called for redemption that have been delivered by the Company to the Series Trustee for cancellation.

Section 3.07 Notes Redeemed in Part.

Upon surrender of a Note that is redeemed in part, the Company shall execute and the Series Trustee shall authenticate for the Holder (at the Company’s expense) a new Note equal in principal amount to the unredeemed portion of the Notes surrendered.

ARTICLE IV

CHANGE OF CONTROL

Section 4.01 Change of Control.

(a) Upon the occurrence of a Change of Control Repurchase Event, unless all Notes have been called for redemption pursuant to Section 3.01 hereof, each Holder of Notes of such series shall have the right to require the Company to repurchase all or any part (equal to $2,000 or an integral multiple of $1,000 in excess thereof) of such Holder’s Notes at an offer price in cash equal to 101% of the aggregate principal amount of Notes repurchased plus any accrued and unpaid interest on the Notes repurchased to the date of purchase (the “Change of Control Payment”).

(b) Within 30 days following any Change of Control Repurchase Event or, at the Company’s option, prior to any proposed Change of Control, but after the public announcement of the proposed Change of Control, the Company shall mail, or cause to be mailed, a notice (a “Change in Control Offer”) to each Holder, with a copy to the Series Trustee, describing the transaction or transactions that constitute or may constitute the Change of Control Repurchase Event and specifying:

(i) that the Change of Control Offer is being made pursuant to this Section 4.01 and that all Notes tendered will be accepted for payment;

(ii) the Change of Control Payment and the purchase date, which shall be a Business Day no earlier than 30 days and no later than 60 days from the date such notice is mailed (the “Change of Control Payment Date”);

 

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(iii) the CUSIP numbers for the Notes;

(iv) that any Note not tendered will continue to accrue interest;

(v) that, unless the Company defaults in the payment of the Change of Control Payment, all Notes accepted for payment pursuant to the Change of Control Offer will cease to accrue interest after the Change of Control Payment Date;

(vi) that Holders electing to have any Notes purchased pursuant to a Change of Control Offer will be required to surrender such Notes to the Paying Agent at the address specified in the notice prior to the close of business on the third Business Day preceding the Change of Control Payment Date;

(vii) that Holders will be entitled to withdraw their election referred to in clause (vi) if the Paying Agent receives, not later than the close of business on the second Business Day preceding the Change of Control Payment Date, a facsimile transmission or letter setting forth the name of the Holder, the principal amount of Notes delivered for purchase, and a statement that such Holder is withdrawing his election to have the Notes purchased;

(viii) that Holders whose Notes are being purchased only in part will be issued new Notes equal in principal amount to the unpurchased portion of the Notes surrendered, which unpurchased portion will be equal to $2,000 in principal amount or an integral multiple of $1,000 in excess thereof; and

(ix) if the notice is mailed prior to the date of consummation of the Change of Control, that the Change of Control Offer is conditioned on the Change of Control Repurchase Event occurring on or prior to the payment date specified in the notice.

(c) The Company shall cause the Change of Control Offer to remain open for at least 20 Business Days or such longer period as is required by applicable law. The Company shall comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder to the extent those laws and regulations are applicable in connection with the repurchase of the Notes as a result of a Change in Control Repurchase Event. To the extent that the provisions of any securities laws or regulations conflict with the provisions of this Section 4.01, the Company will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under this Section 4.01 by virtue of such conflict.

(d) On the Change of Control Payment Date, the Company will, to the extent lawful:

(i) accept for payment all Notes or portions thereof properly tendered pursuant to the Change of Control Offer;

 

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(ii) deposit with the Paying Agent an amount equal to the Change of Control Payment in respect of all Notes or portions of Notes properly tendered; and

(iii) deliver or cause to be delivered to the Series Trustee the Notes so accepted together with an Officers’ Certificate stating the aggregate principal amount of Notes or portions of Notes being purchased by the Company.

(e) The Paying Agent will promptly mail to each Holder of Notes properly tendered the Change of Control Payment for such Notes, and the Series Trustee will promptly authenticate and mail (or cause to be transferred by book entry) to each Holder a new Note equal in principal amount to any unpurchased portion of the Notes surrendered, if any; provided that each new Note will be in a principal amount of $2,000 or an integral multiple of $1,000 in excess thereof. The Company will publicly announce the results of the Change of Control Offer on or as soon as practicable after the Change of Control Payment Date.

(f) The Company shall not be required to make a Change of Control Offer upon a Change of Control Repurchase Event if a third party makes the Change of Control Offer in the manner, at the times and otherwise in compliance with the requirements set forth in this Section 4.01 applicable to a Change of Control Offer made by the Company and purchases all Notes properly tendered and not withdrawn under such Change of Control Offer.

ARTICLE V

REMEDIES

Section 5.01 Events of Default.

(a) For purposes of the Notes, the following events of default shall replace the events of default in Section 501(1), (6), (7) and (8) of the Existing Indenture in its entirety and shall be in addition to the other events of default in Section 501 of the Existing Indenture, which shall in all respects be applicable in respect of the Notes.

(b) For purposes of the Notes, Section 501(1) of the Existing Indenture is replaced in its entirety by inserting therein a new Section 501(1) to read as follows:

“(1) default in the payment of any interest on any Note of such series when such interest becomes due and payable, and continuance of such default for a period of 30 days;”.

(c) For purposes of the Notes, Section 501(6) of the Existing Indenture is replaced in its entirety by inserting the word “Restricted” before each reference to “Subsidiary” therein, such that Section 501(6) shall read as follows:

“(6) the entry by a court or agency or supervisory authority having competent jurisdiction of:

 

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(a) a decree or order for relief in respect of the Company or any Restricted Subsidiary in an involuntary proceeding under any applicable bankruptcy, insolvency, reorganization or other similar law and such decree or order shall remain unstayed and in effect for a period of 60 consecutive days; or

(b) a decree or order adjudging the Company or any Restricted Subsidiary to be insolvent, or approving a petition seeking reorganization, arrangement, adjustment or composition of the Company or any Restricted Subsidiary and such decree or order shall remain unstayed and in effect for a period of 60 consecutive days; or

(c) a decree or order appointing any Person to act as a custodian, receiver, liquidator, assignee, trustee or other similar official of the Company or any Restricted Subsidiary or of any substantial part of the property of the Company or any Restricted Subsidiary, as the case may be, or ordering the winding up or liquidation of the affairs of the Company or any Restricted Subsidiary and such decree or order shall remain unstayed and in effect for a period of 60 consecutive days; or”.

(d) For purposes of the Notes, Section 501(7) of the Existing Indenture is replaced in its entirety by inserting the word “Restricted” before each reference to “Subsidiary” therein, such that Section 501(7) shall read as follows:

“(7) the commencement by the Company or any Restricted Subsidiary of a voluntary proceeding under any applicable bankruptcy, insolvency, reorganization or other similar law or of a voluntary proceeding seeking to be adjudicated insolvent or the consent by the Company or any Restricted Subsidiary to the entry of a decree or order for relief in an involuntary proceeding under any applicable bankruptcy, insolvency, reorganization or other similar law or to the commencement of any insolvency proceeding against it, or the filing by the Company or any Restricted Subsidiary of a petition or answer or consent seeking reorganization or relief under any applicable law, or the consent by the Company or any Restricted Subsidiary to the filing of such petition or to the appointment of or taking possession by a custodian, receiver, liquidator, assignee, trustee or similar official of the Company or any Restricted Subsidiary or any substantial part of the property of the Company or any Restricted Subsidiary or the making by the Company or any Restricted Subsidiary of an assignment for the benefit of creditors, or the taking of corporate action by the Company or any Restricted Subsidiary in furtherance of any such action; or”.

(e) For purposes of the Notes, Section 501(8) of the Existing Indenture is replaced in its entirety by inserting after the number “$10,000,000” the words “(that is not covered by independent third party insurance as to which the insurer does not dispute coverage)” therein, such that Section 501(8) shall read as follows:

“(8) a final judgment, judicial decree or order for the payment of money in excess of $10,000,000 (that is not covered by independent third party insurance as

 

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to which the insurer does not dispute coverage) shall be rendered against the Company or any Subsidiary and such judgment, decree or order shall continue unsatisfied for a period of 60 days without a stay of execution;”.

ARTICLE VI

COVENANTS

The covenants set forth in this Article VI shall be applicable to the Company in addition to the covenants in Article Ten of the Existing Indenture, which shall in all respects be applicable in respect of the Notes.

Section 6.01 Limitation on Liens.

The Company shall not, and shall not permit any Restricted Subsidiary to, create, incur, assume or otherwise cause or suffer to exist or become effective any Lien of any kind on a Principal Property securing Debt unless one or more of the following exceptions apply:

(a) the Lien equally and ratably secures the Notes and the Debt or any other obligation of the Company or a Subsidiary; provided that any obligation secured by a Lien is not subordinated to the Notes;

(b) the Lien secures Debt incurred to finance all or part of the purchase price or the cost of construction or improvement of property of the Company or a Restricted Subsidiary; provided that (i) such Lien shall not extend to any other Principal Property owned by the Company or a Restricted Subsidiary at the time the Lien is incurred, except for unimproved real property used for such construction or improvement, and (ii) such Debt shall not be incurred more than 18 months after the later of the acquisition, completion of construction or improvement, or commencement of full operation of the property subject to the Lien;

(c) the Lien is on property of an entity at the time the entity merges into or consolidates with the Company or a Restricted Subsidiary;

(d) the Lien is on property at the time such property is acquired by the Company or a Restricted Subsidiary;

(e) the Lien is on property of a Person at the time such Person becomes a Restricted Subsidiary;

(f) the Lien secures Debt of a Restricted Subsidiary owing to the Company or another Restricted Subsidiary;

(g) the Lien is in favor of a government or governmental entity and secures (i) payments pursuant to a contract or statute, or (ii) Debt incurred to finance all or part of the purchase price or cost of construction or improvement of the property subject to the Lien;

(h) the Lien extends, renews or replaces in whole or in part a Lien (“existing Lien”) permitted by any of clauses (a) through (g) or extends to property that at the time is not a Principal

 

16

Property; provided that (i) such Lien does not extend beyond the property subject to the existing Lien and improvements and construction on such property, and (ii) the amount of the Debt secured by such Lien does not exceed the amount of the Debt secured at the time by the existing Lien unless the existing Lien or a predecessor Lien was incurred under clause (a) or (f); or

(i) the Debt plus all other Debt secured by Liens on Principal Property at the time does not exceed 10% of Consolidated Total Assets, excluding (i) Debt secured by a Lien permitted by any of clauses (a) through (h) of this Section and (ii) Debt secured by a Lien incurred prior to the date of the Existing Indenture that would have been permitted by any of those clauses if the Existing Indenture had been in effect at the time the Lien was incurred, and including Attributable Debt for any lease permitted by Section 6.02(d) of this Sixth Supplemental Indenture not otherwise permitted by any of clauses (a) through (h) of this Section.

Section 6.02 Limitation on Sale and Leaseback Transactions.

The Company shall not, and shall not permit any Restricted Subsidiary to, enter into a Sale-Leaseback Transaction for a Principal Property, unless one or more of the following exceptions apply:

(a) the lease has a term of three years or less;

(b) the lease is between the Company and a Restricted Subsidiary or between Restricted Subsidiaries;

(c) the Company or a Restricted Subsidiary under Sections 6.01(b) through (h) of this Sixth Supplemental Indenture may create a Lien on the property to secure Debt in an amount at least equal to the Attributable Debt for the lease;

(d) the Company or a Restricted Subsidiary under Section 6.01(i) of this Sixth Supplemental Indenture could create a Lien on the Principal Property to secure Debt in an amount at least equal to the Attributable Debt for the lease; or

(e) the Company or a Restricted Subsidiary, within 180 days of the effective date of the lease, retires Long-Term Debt of the Company or a Restricted Subsidiary in an amount at least equal to the Attributable Debt for the lease, excluding Debt of the Company that is subordinated to the Notes and Debt, if paid in cash, that is owned by the Company or a Restricted Subsidiary.

ARTICLE VII

SERIES TRUSTEE, SECURITY REGISTRAR AND PAYING AGENT WITH RESPECT TO THE NOTES

Section 7.01 Appointment by the Company of U.S. Bank National Association as Series Trustee etc.

Pursuant to the Existing Indenture as amended by this Sixth Supplemental Indenture, the Company hereby appoints U.S. Bank National Association as Series Trustee, Security Registrar and Paying Agent under the Indenture with respect to the Notes (but only with respect to the

 

17

Notes) with all of the rights, powers, trusts, duties and obligations of Trustee, Security Registrar and Paying Agent under the Indenture with respect to the Notes (but only with respect to the Notes) with like effect as if originally named as such in the Indenture.

Section 7.02 Acceptance by U.S. Bank National Association of Appointment as Series Trustee etc.

U.S. Bank National Association hereby accepts its appointment as Series Trustee, Security Registrar and Paying Agent under the Indenture with respect to the Notes (but only with respect to the Notes) and accepts all of the rights, powers, trusts, duties and obligations of Trustee, Security Registrar and Paying Agent under the Indenture with respect to the Notes (but only with respect to the Notes), upon the terms and conditions set forth herein and therein, with like effect as if originally named as such in the Indenture. Pursuant to the Existing Indenture, there shall continue to be vested in the Original Trustee all of its rights, powers, trusts, duties and obligations as Trustee under the Existing Indenture with respect to all of the series of securities as to which it has served and continues to serve as Trustee, and the Original Trustee shall have no rights, powers, trusts, duties and obligations with respect to the Notes.

Section 7.03 Eligibility of Series Trustee.

The Series Trustee hereby represents that it is qualified and eligible under the provisions of the Trust Indenture Act and Section 610 of the Existing Indenture to accept its appointment as Series Trustee with respect to the Notes.

Section 7.04 Concerning the Series Trustee.

Neither the Original Trustee nor the Series Trustee assumes any duties, responsibilities or liabilities by reason of this Sixth Supplemental Indenture other than as set forth in the Existing Indenture and, in carrying out its responsibilities hereunder, each shall have all of the rights, powers, privileges, protections, duties and immunities which it possesses under the Existing Indenture. The Original Trustee and the Series Trustee shall not constitute co-trustees of the same trust, and each of the Original Trustee and the Series Trustee shall be trustee of a trust or trusts under the Indenture separate and apart from any trust or trusts under the Indenture administered by the other trustee. The Original Trustee shall have no liability for any acts or omissions of the Series Trustee and the Series Trustee shall have no liability for any acts or omissions of the Original Trustee.

References in this Sixth Supplemental Indenture to sections of the Existing Indenture that require or permit actions by the Original Trustee with respect to the Notes shall be deemed to require or permit actions only by the Series Trustee and the Original Trustee shall have no responsibility therefor.

ARTICLE VIII

MISCELLANEOUS

 

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Section 8.01 Issuance of Additional Notes.

For purposes of the Notes, Section 901 of the Existing Indenture is hereby amended by inserting therein a new Section 901(8) to read as follows:

“(8) to issue additional Notes of any series in the future pursuant to Section 303 of this Indenture; provided that such additional Notes have the same terms as, and be deemed part of the same series as, the Notes issued hereunder.”

Section 8.02 Amendment to Section 901(6)

For purposes of the Notes, Section 901(6) of the Existing Indenture is hereby amended to read as follows:

“(6) to evidence and provide acceptance of the appointment of a successor Trustee hereunder or if other than the Person named as the “Trustee” in the first paragraph of this Indenture (or a successor to such Person pursuant to the applicable provisions of this Indenture) (for purposes of this Section 901(6), herein called the “Original Trustee”), the identity of a Trustee for such Notes, and, at the election of the Company, other Notes of any series to be issued thereafter pursuant to this Indenture (a “Series Trustee”), and if not the Series Trustee, the identity of each Security Registrar, Paying Agent or Authenticating Agent with respect to such Notes, and such additions or changes to any provisions of this Indenture as shall be necessary to provide for or facilitate the administration of the trusts hereunder by more than one Trustee, it being understood that, anything contained herein or in any Board Resolution, Officer’s Certificate or supplemental indenture to the contrary notwithstanding, that (i) nothing herein shall constitute such Trustees co-trustees of the same trust, (ii) each such Trustee shall be a trustee of a trust or trusts hereunder separate and apart from any trust or trusts hereunder administered by any other such Trustee, (iii) the Series Trustee shall have all the rights, powers, trusts, duties and obligations of the Original Trustee with respect to, and only with respect to, such Notes, (iv) the Original Trustee shall have no rights, powers, trusts, duties or obligations with respect to such Notes, (v) no Trustee hereunder shall have any liability for any acts or omissions of any other Trustee hereunder and (vi) no appointment of a Series Trustee shall become effective until the acceptance of the appointment by the Series Trustee in writing; or”

Section 8.03 Trust Indenture Act Controls.

If any provision of this Sixth Supplemental Indenture limits, qualifies or conflicts with another provision that is required or deemed to be included in this Sixth Supplemental Indenture by the Trust Indenture Act, the required or deemed provision shall control.

Section 8.04 Notices.

Any notice or communication shall be in writing and delivered in person or mailed by first-class mail or sent by facsimile (with a hard copy delivered in person or by mail promptly thereafter) and addressed as follows:

if to the Company:

 

19

The Valspar Corporation

901 – Third Avenue South

Minneapolis, Minnesota 55402

Attention: Rolf Engh

Facsimile: (612) 375-7313

with a copy to:

Lindquist & Vennum LLP

4200 IDS Center

80 South 8th Street

Minneapolis, Minnesota 55402

Attention: Richard D. McNeil

Facsimile: (612) 371-3207

if to the Series Trustee:

U.S. Bank National Association

60 Livingston Avenue

EP-MN-WS3C

St. Paul, MN 55107-2292

Attn: Corporate Trust Administration

Fax (651) 466-7430

The Company or the Series Trustee by notice to the other may designate additional or different addresses for subsequent notices or communications.

Section 8.05 When Notes Disregarded.

In determining whether the Holders of the required principal amount of Notes have concurred in any direction, waiver or consent, Notes owned by the Company or by any Person directly or indirectly controlling or controlled by or under direct or indirect common control with the Company shall be disregarded and deemed not to be Outstanding, except that, for the purpose of determining whether the Series Trustee shall be protected in relying on any such direction, waiver or consent, only Notes that a Responsible Officer of the Series Trustee actually knows are so owned shall be so disregarded. Also, subject to the foregoing, only Notes Outstanding at the time shall be considered in any such determination.

Section 8.06 Rules by Series Trustee, Paying Agent and Security Registrar.

The Series Trustee may make reasonable rules for action by or a meeting of Holders. The Security Registrar and the Paying Agent or co-registrar may make reasonable rules for their functions.

 

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Section 8.07 Payment on Business Days.

If a payment date is not a Business Day, payment shall be made on the next succeeding day that is a Business Day, and no interest shall accrue for the intervening period. If a Regular Record Date is not a Business Day, the Regular Record Date shall not be affected.

Section 8.08 Governing Law.

THIS SIXTH SUPPLEMENTAL INDENTURE AND THE NOTES SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.

Section 8.09 No Personal Liability of Directors, etc.

None of the Company’s directors, officers, employees, incorporators or stockholders, as such, shall have any liability for any of the Company’s obligations under the Notes, the Indenture, or for any claim based on, in respect of, or by reason of, such obligations or their creation. Each Holder of Notes by accepting a Note waives and releases all such liability. The waiver and release are part of the consideration for issuance of the Notes.

Section 8.10 Successors.

All agreements of the Company in the Indenture and the Notes shall bind its successors. All agreements of the Series Trustee in the Indenture shall bind its successors.

Section 8.11 Multiple Originals.

The parties may sign any number of copies of this Sixth Supplemental Indenture. Each signed copy shall be an original, but all of them together represent the same agreement. One signed copy is enough to prove this Sixth Supplemental Indenture.

Section 8.12 Table of Contents; Headings.

The table of contents and headings of the Articles and Sections of this Sixth Supplemental Indenture have been inserted for convenience of reference only, are not intended to be considered a part hereof and shall not modify or restrict any of the terms or provisions hereof.

Section 8.13 Trustees Not Responsible for Recitals

The recitals contained herein shall be taken as statements of the Company, and the Original Trustee and the Series Trustee do not assume any responsibility for their correctness. The Original Trustee and the Series Trustee make no representations as to the validity or sufficiency of this Sixth Supplemental Indenture, except that the Original Trustee and the Series Trustee each represents that it is duly authorized to execute and deliver this Sixth Supplemental Indenture and with respect to the Series Trustee to perform its obligations hereunder.

 

21

Section 8.14 Adoption, Ratification and Confirmation.

The Existing Indenture, as supplemented and amended by this Sixth Supplemental Indenture, is in all respects hereby adopted, ratified and confirmed.

 

22

IN WITNESS WHEREOF, the parties have caused this Sixth Supplemental Indenture to be duly executed as of the date first written above.

 

THE VALSPAR CORPORATION
  By:  

/s/ Tyler N. Treat

    Name:   Tyler N. Treat
    Title:   VP Treasurer
U.S. BANK NATIONAL ASSOCIATION, as Series Trustee
  By:  

/s/ Joshua A. Hahn

    Name:   Joshua A. Hahn
    Title:   Vice President
THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A., as Original Trustee
  By:  

/s/ Jonathan Glover

    Name:   Jonathan Glover
    Title:   Vice President

This is a signature page to the Sixth Supplemental Indenture.

 

23

EXHIBIT A

THIS NOTE IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITORY OR A NOMINEE THEREOF. THIS NOTE MAY NOT BE EXCHANGED IN WHOLE OR IN PART FOR A NOTE REGISTERED, AND NO TRANSFER OF THIS SECURITY IN WHOLE OR IN PART MAY BE REGISTERED, IN THE NAME OF ANY PERSON OTHER THAN SUCH DEPOSITORY OR A NOMINEE THEREOF, EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE.

UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY TO THE ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO., OR SUCH OTHER NAME AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY AND ANY PAYMENT HEREON IS MADE TO CEDE & CO., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

CUSIP No. 920355 AK0

ISIN No. US920355AK06

THE VALSPAR CORPORATION

$350,000,000 3.950% NOTE DUE 2026

 

$350,000,000    No.: R-        

The Valspar Corporation, a Delaware corporation (herein called the “Company”), for value received, hereby promises to pay to CEDE & CO., or registered assigns, the principal sum of THREE HUNDRED FIFTY MILLION DOLLARS or such other Principal Amount as shall be set forth on Schedule I hereto on January 15, 2026 and to pay interest thereon at the rate of 3.950% per annum from the Initial Interest Accrual Date or from the most recent Interest Payment Date to which interest has been paid or duly provided for, on January 15 and July 15 of each year, commencing January 15, 2016 (each an “Interest Payment Date”), until the principal hereof is paid or made available for payment.

The interest so payable, and punctually paid or duly provided for, on any Interest Payment Date will, except as provided in the Indenture hereinafter referred to, be paid to the Person in whose name this Note (or one or more Predecessor Notes) is registered at the close of business on the Regular Record Date for such interest, which will be the January 1 and July 1, as the case may be, immediately preceding each Interest Payment Date. Any such interest not so punctually paid or duly provided for shall forthwith cease to be payable to the Holder on such Regular Record Date and either may be paid to the Person in whose name this Note (or one or more Predecessor Notes) is registered at the close of business on a Special Record Date for the payment of such defaulted interest to be fixed by the Series Trustee, notice whereof shall be given to the Holders not less than

 

A-1

ten days prior to such Special Record Date, or may be paid at any time in any other lawful manner, all as more fully provided in the Indenture. Payment of the principal of and interest on this Note will be made at the office or agency of the Company maintained for that purpose in Minneapolis, Minnesota, or in such other office or agency as may be established by the Company pursuant to the Indenture (initially the principal corporate trust office of the Series Trustee in New York, New York (the “Corporate Trust Office”)), in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts; provided, however, that payment of interest may be made at the option of the Company (i) by check mailed to the address of the Person entitled thereto as such address shall appear in the Note Register or (ii) by wire transfer to an account maintained by the Person entitled thereto as specified in the Note Register. Payments of principal and interest at maturity will be made against presentation of this Note at the Corporate Trust Office (or such other office as may be established pursuant to the Indenture), by check or wire transfer.

Reference is hereby made to the further provisions of this Note set forth on the reverse side hereof, which further provisions shall for all purposes have the same effect as though fully set forth at this place.

Unless the Certificate of Authentication hereon has been executed by the Series Trustee or an Authenticating Agent under the Indenture referred to on the reverse hereof by the manual signature of one of its authorized officers, this Note shall not be entitled to any benefit under the Indenture or be valid or obligatory for any purpose.

 

A-2

IN WITNESS WHEREOF, the Company has caused this Note to be signed in its name by the manual or facsimile signature of its Chief Executive Officer, its President or one of its Vice Presidents and attested by the manual or facsimile signature of its Secretary or one of its Assistant Secretaries.

Date:

 

THE VALSPAR CORPORATION
By:  

 

  Name:
  Title:

 

ATTEST:

 

Secretary

 

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Series Trustee’s Certificate of Authentication

This is one of the Notes described in the Indenture.

Dated:

 

U.S. Bank National Association, as Series Trustee
By:  

 

  Authorized Signatory

 

A-4

(Reverse of Note)

THE VALSPAR CORPORATION

3.950% NOTE DUE 2026

1. This Note is one of a duly authorized issue of securities of the Company designated as its 3.950% Notes due 2026 (the “Notes”), issued under an Indenture dated as of April 24, 2002 (herein called, together with the First Supplemental Indenture dated as of April 30, 2002, the Second Supplemental Indenture dated as of April 17, 2007, the Third Supplemental Indenture dated as of June 19, 2009, the Fourth Supplemental Indenture dated as of January 13, 2012, the Fifth Supplemental Indenture dated as of January 21, 2015 and the Sixth Supplemental Indenture referred to below and all other indentures supplemental thereto, the “Indenture”) between the Company and The Bank of New York Mellon Trust Company, N.A. (successor to Bank One Trust Company, N.A.), as trustee, to which Indenture and all indentures supplemental thereto reference is hereby made for a statement of the respective rights thereunder of the Company, the Original Trustee (as defined below), the Series Trustee (as defined below) and the Holders of the Notes, and the terms upon which the Notes are, and are to be, authenticated and delivered.

2. This Note is one of the series designated on the face hereof, limited to an aggregate principal amount not to exceed $350,000,000, which amount may be increased at the option of the Company if in the future it determines that it may wish to sell additional Notes of this series, as specified in the Sixth Supplemental Indenture among the Company, The Bank of New York Mellon Trust Company, N.A., as original trustee (herein called the “Original Trustee,” which term includes any successor trustee thereto under the Indenture) and U.S. Bank National Association, as series trustee for the Notes (herein called the “Series Trustee,” which term includes any successor trustee thereto with respect to the Notes under the Indenture) and as Security Registrar and Paying Agent with respect to the Notes, dated as of July 27, 2015, establishing the form and certain terms of the Notes pursuant to the Indenture (the “Sixth Supplemental Indenture”). References herein to “this series” mean the series of Notes designated on the face hereof.

3. The Notes are subject to redemption, in whole or in part, on any date prior to October 15, 2025, (three months prior to the stated maturity date), at the Company’s option at a Redemption Price equal to the greater of:

(i) 100% of the principal amount of the Notes to be redeemed, and

(ii) as determined by the Quotation Agent, the sum of the present values of the remaining scheduled payments of principal and interest in respect of the Notes to be redeemed (not including any portion of those payments of interest accrued as of the date of redemption) discounted to the date of redemption on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months) at the Treasury Rate plus 25 basis points

plus accrued and unpaid interest to the redemption date.

 

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In addition, at any time on or after October 15, 2025 (three months prior to the stated maturity of the Notes), the Company may also redeem some or all of the Notes at its option, at a Redemption Price equal to 100% of the principal amount of the Notes being redeemed plus accrued and unpaid interest to the redemption date.

“Comparable Treasury Issue” means the United States Treasury security selected by the Quotation Agent as having a maturity comparable to the remaining term of the Notes to be redeemed that would be utilized, at the time of selection and in accordance with customary financial practice, in pricing new issues of corporate debt securities of comparable maturity to the remaining term of such Notes.

“Comparable Treasury Price” means, with respect to any redemption date, (i) the average of four Reference Treasury Dealer Quotations for such redemption date, after excluding the highest and lowest such Reference Treasury Dealer Quotations, or (ii) if the Series Trustee obtains fewer than four such Reference Treasury Dealer Quotations, the average of all such quotations, or (iii) if only one Reference Treasury Dealer Quotation is received, such quotation.

“Quotation Agent” means the Reference Treasury Dealer appointed by the Company.

“Reference Treasury Dealer” means (i) Merrill Lynch Pierce, Fenner & Smith Incorporated and HSBC Securities (USA) Inc. and their respective successors (provided, however, that if any such firm or successor, as the case may be, ceases to be a primary U.S. Government securities dealer in the United States (a “Primary Treasury Dealer”), the Company shall substitute therefor another Primary Treasury Dealer), (ii) one Primary Treasury Dealer selected by U.S. Bancorp Investments, Inc. or its successor, (iii) one Primary Treasury Dealer selected by Wells Fargo Securities, LLC or its successor, and (iv) any other Primary Treasury Dealers selected by the Company.

“Reference Treasury Dealer Quotations” means, with respect to each Reference Treasury Dealer and any redemption date, the average, as determined by the Series Trustee, of the bid and asked prices for the Comparable Treasury Issue (expressed in each case as a percentage of its principal amount) quoted in writing to the Series Trustee by such Reference Treasury Dealer at 5:00 p.m., New York City time, on the third business day preceding such redemption date.

“Treasury Rate” means, with respect to any redemption date, the rate per annum equal to the semi-annual equivalent yield to maturity of the Comparable Treasury Issue, assuming a price for the Comparable Treasury Issue (expressed as a percentage of its principal amount) equal to the Comparable Treasury Price for such redemption date.

Any notice to holders of Notes of a redemption pursuant to this paragraph 3 hereof will include the appropriate calculation of the redemption price, but does not need to include the redemption price itself. The actual redemption price, calculated as described above, will be set forth in an Officers’ Certificate of the Company delivered to the Series Trustee no later than two Business Days prior to the redemption date.

4. Upon the occurrence of a Change of Control Repurchase Event, unless all Notes

 

A-6

have been called for redemption pursuant to paragraph 3 of this Note, each Holder of the Notes shall have the right to require the Company to repurchase all or any part (equal to $2,000 or an integral multiple of $1,000 in excess thereof) of such Notes at an offer price in cash equal to 101% of the aggregate principal amount of such Notes plus accrued and unpaid interest thereon, if any, to the date of repurchase. “Change of Control Repurchase Event” means the occurrence of both a Change of Control and a Below Investment Grade Rating Event, as such terms are defined in the Indenture. The Change of Control Offer will be made in accordance with the terms specified in the Indenture.

5. If an Acceleration Event with respect to the Notes shall occur and be continuing, the Series Trustee or the Holders of not less than 25% in principal amount of the Outstanding Notes may declare the principal of all Notes due and payable in the manner and with the effect provided in the Indenture. An “Acceleration Event” is an Event of Default relating to bankruptcy, insolvency, or reorganization of the Company as more specifically defined by the Indenture. The Indenture provides that such declaration and its consequences may, in certain events, be annulled by the Holders of a majority in principal amount of the Outstanding Notes.

6. The Indenture permits, with certain exceptions as therein provided, the amendment thereof and the modification of the rights and obligations of the Company and the rights of the Holders of Notes under the Indenture at any time by the Company and the Series Trustee with the consent of the Holders of a majority in aggregate principal amount of Notes at the time Outstanding. The Indenture also contains provisions permitting the Holders of specified percentages in aggregate principal amount of Notes at the time Outstanding, on behalf of the Holders of all Notes, to waive compliance by the Company with certain provisions of the Indenture and certain past defaults under the Indenture and their consequences. Any such consent or waiver by the Holder of this Note shall be conclusive and binding upon such Holder and upon all future Holders of this Note and of any Note issued upon the registration of transfer hereof or in exchange therefor or in lieu hereof, whether or not notation of such consent or waiver is made upon this Note.

7. No reference herein to the Indenture and no provisions of this Note or of the Indenture shall alter or impair the obligation of the Company, which is absolute and unconditional, to pay the principal of and interest on this Note at the times, places and rate, and in the coin or currency, herein prescribed.

8. As provided in the Indenture and subject to certain limitations therein set forth, the transfer of this Note may be registered on the Note Register of the Company, upon surrender of this Note for registration of transfer at the office or agency of the Company to be maintained for that purpose in New York, New York, or at such other office or agency as may be established by the Company for such purpose pursuant to the Indenture (initially the principal corporate trust office of the Series Trustee in New York, New York), duly endorsed by, or accompanied by a written instrument of transfer in form satisfactory to the Company, and duly executed by the Holder hereof or such Holder’s attorney duly authorized in writing, and thereupon one or more new Notes, of authorized denominations and for the same aggregate principal amount, will be issued to the designated transferee or transferees.

 

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9. The Notes are issuable only in fully registered form, without coupons, in denominations of $2,000 or any amount in excess thereof which is an integral multiple of $1,000. As provided in the Indenture, and subject to certain limitations therein set forth, the Notes are exchangeable for a like aggregate principal amount of Notes in authorized denominations, as requested by the Holder surrendering the same.

10. No service charge shall be made for any such registration of transfer or exchange, but the Company may require payment of a sum sufficient to cover any tax or other governmental charge payable in connection therewith.

11. Prior to the due presentment of this Note for registration of transfer or exchange, the Company, the Series Trustee and any agent of the Company or the Series Trustee may treat the Person in whose name this Note is registered as the owner hereof for all purposes, whether or not this Note be overdue, and neither the Company, the Series Trustee, nor any such agent shall be affected by notice to the contrary.

12. Interest on the Notes shall be computed on the basis of a 360-day year of twelve 30- day months. Interest shall be payable to and excluding any Interest Payment Date.

13. The Series Trustee, in its individual or any other capacity, may make loans to, accept deposits from, and perform services for the Company or its Affiliates, and may otherwise deal with the Company or its Affiliates, as if it were not the Series Trustee.

14. This Note shall not be valid until authenticated by the manual signature of the Series Trustee or an Authenticating Agent.

15. Customary abbreviations may be used in the name of a Holder or an assignee, such as: TEN COM (= tenants in common), TEN ENT (= tenants by the entireties), JT TEN (= joint tenants with right of survivorship and not as tenants in common), CUT (= Custodian), and U/G/M/A (= Uniform Gifts to Minors Act).

16. Each Holder of this Note covenants and agrees by such Holder’s acceptance thereof to comply with and be bound by the foregoing provisions.

17. All terms used in this Note which are defined in the Indenture shall have the meanings assigned to them in the Indenture.

 

A-8

ASSIGNMENT FORM

FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s) unto

 

PLEASE INSERT SOCIAL SECURITY OR
OTHER IDENTIFYING NUMBER OF ASSIGNEE

  

PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS INCLUDING POSTAL ZIP CODE OF ASSIGNEE

 

    

 

    

 

    

the within Security and all rights thereunder, hereby irrevocably constituting and appointing                                                       attorney to transfer said Security on the books of the Company, with full power of substitution in the premises.

 

Dated:  

 

Signature:  

 

 

NOTICE:   THE SIGNATURE TO THIS ASSIGNMENT MUST CORRESPOND WITH THE NAME AS WRITTEN UPON THE FACE OF THE WITHIN INSTRUMENT IN EVERY PARTICULAR, WITHOUT ALTERATION OR ENLARGEMENT OR ANY CHANGE WHATEVER.

Signature Guarantee:

SIGNATURE GUARANTEE

Signatures must be guaranteed by an “eligible guarantor institution” meeting the requirements of the Registrar, which requirements include membership or participation in the Security Transfer Agent Medallion Program (“STAMP”) or such other “signature guarantee program” as may be determined by the Registrar in addition to, or in substitution for, STAMP, all in accordance with the Securities Exchange Act of 1934, as amended.

 

A-9

Schedule I

SCHEDULE OF TRANSFERS AND EXCHANGES

The following increases or decreases in Principal Amount of this Global Security have been made:

 

Date of
Exchange

   

Amount of Decrease in
Principal Amount of
this Global Security

   

Amount of Increase in
Principal Amount of
this Global Security

   

Principal Amount of this
Global Security
following such Decrease
or Increase

   

Signature of
Authorized
Signatory of Series
trustee or
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A-10



Exhibit 99.1

July 27, 2015

The Valspar Corporation

1101 South 3rd Street

Minneapolis, Minnesota 55415

 

RE: Registration Statement on Form S-3

Ladies and Gentlemen:

I have acted as General Counsel for The Valspar Corporation, a Delaware corporation (the “Company”), in the preparation of a Registration Statement on Form S-3 (File No. 333-201521) (the “Registration Statement”) filed with the United States Securities and Exchange Commission under the Securities Act of 1933 (the “Securities Act”), relating to the proposed offer and sale from time to time of the securities referred to therein, and a Prospectus Supplement dated July 22, 2015 to the Prospectus dated January 15, 2015 (collectively, the “Prospectus”), relating to the offer and sale by the Company under the Registration Statement of $350,000,000 aggregate principal amount of the Company’s 3.950% Senior Notes due 2025 (the “Notes”).

The Notes are issued under the Indenture dated as of April 24, 2002 entered into by the Company and The Bank of New York Mellon Trust Company, N.A. (as successor in interest to Bank One Trust Company, N.A., “BNY Mellon”), as trustee, as amended and supplemented by (i) a first supplemental indenture dated April 30, 2002, between the Company and BNY Mellon, (ii) a second supplemental indenture dated April 17, 2007, between the Company and BNY Mellon, (iii) a third supplemental indenture dated June 19, 2009, among the Company, BNY Mellon and U.S. Bank National Association, as series trustee, (iv) a fourth supplemental indenture dated January 13, 2012, among the Company, BNY Mellon and U.S. Bank National Association, as series trustee, (v) a fifth supplemental indenture dated January 21, 2015, among the Company, BNY Mellon and U.S. Bank National Association, as series trustee, and as further amended and supplemented by a sixth supplemental indenture between the Company, BNY Mellon and U.S. Bank National Association, as series trustee for the Notes (the “Trustee”). The Indenture, as amended and supplemented, is referred to herein as the “Indenture.” The Notes are sold pursuant to the Underwriting Agreement, dated July 22, 2015 between the Company and the Underwriters named therein (the “Underwriting Agreement”).

I have examined such documents, records, and instruments as I have deemed necessary or appropriate for the purposes of this opinion.

Based on the foregoing, I am of the opinion that the Notes have been duly authorized and executed and, when authenticated in accordance with the provisions of the Indenture, and delivered to and paid for by the Underwriters pursuant to the Underwriting Agreement, the Notes and the Indenture will constitute valid and legally binding obligations of the Company

The Valspar Corporation

Page 2

July 27, 2015

 

enforceable against the Company in accordance with their respective terms. Without limiting any other qualifications set forth herein, to the extent they relate to enforceability, each of the foregoing opinions is subject to the limitation that the provisions of the referenced instruments and agreements may be limited by bankruptcy or other laws of general application affecting the enforcement of creditors’ rights and by general equity principles (regardless of whether enforcement is considered in a proceeding in equity or at law) and to the effect of generally applicable laws that (a) limit the availability of a remedy under certain circumstances where another remedy has been elected, (b) limit the enforceability of provisions releasing, exculpating or exempting a party from, or requiring indemnification of a party for, liability for its own action or inaction, to the extent the action or inaction involves gross negligence, recklessness, willful misconduct or unlawful conduct, or (c) may, where less than all of a contract may be unenforceable, limit the enforceability of the balance of the contract to circumstances in which the unenforceable portion is not an essential part of the agreed exchange.

In rendering these opinions, I have assumed (a) the accuracy and truthfulness of all public records of the Company and of all certifications, documents and other proceedings examined by me that have been produced by officials of the Company acting within the scope of their official capacities, without verifying the accuracy or truthfulness of such representations, (b) the genuineness of such signatures appearing upon such public records, certifications, documents and proceedings, (c) the legal capacity of natural persons who are involved on behalf of the Company to enter into and perform the referenced instrument or agreement or to carry out their role in it, (d) the satisfaction by each party to the referenced instrument or agreement (other than the Company) of those legal requirements that are applicable to it to the extent necessary to make the referenced instrument or agreement enforceable against it, (e) the compliance by each party to the referenced instrument or agreement (other than the Company) with all legal requirements pertaining to its status as such status relates to its rights to enforce such instrument or agreement against the Company, (f) the accuracy and completeness of each document submitted for review and the authenticity of each such document that is an original or, if such document is a copy, its conformance to an authentic original, (g) the absence of any mutual mistake of fact or misunderstanding, fraud, duress or undue influence, and (h) the compliance of the conduct of the parties to the referenced instrument or agreement with any requirement of good faith, fair dealing and conscionability.

I am a member of the Bar of the State of Minnesota, and the foregoing opinions are limited to the existing laws of the State of Minnesota, the federal laws of the United States of America and, with respect to the validity of corporate action and the requirements for the issuance of securities, the existing laws of the State of Delaware and, with respect to the valid and binding nature of the Company’s obligations under the Indenture, the existing laws of the State of New York. I have relied, as to matters of New York law, on the opinion of Maslon LLP dated the date hereof and to be filed as Exhibit 99.2 to the Current Report on Form 8-K filed with the Commission concurrently herewith. The opinions herein expressed are rendered only with respect to the laws, and the rules, regulations and orders under those laws, that are currently in effect. By rendering

The Valspar Corporation

Page 3

July 27, 2015

 

this opinion, I do not undertake to advise the Company with respect to any other matter or of any change in such laws or in the interpretation thereof which may occur after the date hereof.

I hereby consent to the filing of this opinion as an exhibit to a Current Report on Form 8-K of the Company filed with the Commission and thereby incorporated by reference into the Registration Statement and to being named in the Prospectus included therein under the caption “Legal Matters” with respect to matters stated therein, without implying or admitting that I am an “expert” within the meaning of the Securities Act, or other rules and regulations of the Commission issued thereunder with respect to any part of the Registration Statement, including this exhibit.

This opinion speaks only as of the date hereof and is intended solely for use in connection with the issuance and sale of the Notes subject to the Registration Statement and is not to be relied upon for any other purpose.

[Remainder of page left blank. Signature page follows on next page.]

Very truly yours,
/s/ Rolf Engh
Rolf Engh
Executive Vice President, General Counsel and Secretary


Exhibit 99.2

July 27, 2015

The Valspar Corporation

1101 South 3rd Street

Minneapolis, Minnesota 55415

 

RE: Registration Statement on Form S-3

Ladies and Gentlemen:

We have acted as counsel to The Valspar Corporation, a Delaware corporation (the “Company”), in the preparation of a Registration Statement on Form S-3 (File No. 333-201521) (the “Registration Statement”) filed with the United States Securities and Exchange Commission under the Securities Act of 1933 (the “Securities Act”), relating to the proposed offer and sale from time to time of the securities referred to therein, and a Prospectus Supplement dated July 27, 2015 to the Prospectus dated July 27, 2015 (collectively, the “Prospectus”), relating to the offer and sale by the Company under the Registration Statement of $350,000,000 aggregate principal amount of the Company’s 3.950% Senior Notes due 2025 (the “Notes”).

The Notes are issued under the Indenture dated as of April 24, 2002 entered into by the Company and The Bank of New York Mellon Trust Company, N.A. (as successor in interest to Bank One Trust Company, N.A., “BNY Mellon”), as trustee, as amended and supplemented by (i) a first supplemental indenture dated April 30, 2002, between the Company and BNY Mellon, (ii) a second supplemental indenture dated April 17, 2007, between the Company and BNY Mellon, (iii) a third supplemental indenture dated June 19, 2009, among the Company, BNY Mellon and U.S. Bank, N.A., as series trustee, (iv) a fourth supplemental indenture dated January 13, 2012, among the Company, BNY Mellon and U.S. Bank National Association, as series trustee, (v) a fifth supplemental indenture dated January 21, 2015, among the Company, BNY Mellon and U.S. Bank National Association, as series trustee, and as further amended and supplemented by a sixth supplemental indenture between the Company, BNY Mellon and U.S. Bank National Association, as series trustee for the Notes (the “Trustee”). The Indenture, as amended and supplemented, is referred to herein as the “Indenture.” The Notes are sold pursuant to the Underwriting Agreement, dated July 22, 2015 between the Company and the Underwriters named therein (the “Underwriting Agreement”).

We have examined such documents, records, and instruments as we have deemed necessary or appropriate for the purposes of this opinion. Based on the foregoing, we are of the opinion that the Indenture is a valid and binding obligation of the Company.

The foregoing opinion assumes that the Indenture has been duly authorized, executed and delivered by all parties thereto other than the Company. Without limiting any other qualifications

The Valspar Corporation

Page 2

July 27, 2015

 

set forth herein, to the extent they relate to enforceability, each of the foregoing opinions is subject to the limitation that (A) the Indenture is governed by the laws of the State of New York, and the choice of New York law to govern the Indenture is a valid and legal provision, and (B) the provisions of the Indenture may be limited by bankruptcy or other laws of general application affecting the enforcement of creditors’ rights and by general equity principles (regardless of whether enforcement is considered in a proceeding in equity or at law) and to the effect of generally applicable laws that (i) limit the availability of a remedy under certain circumstances where another remedy has been elected, (ii) limit the enforceability of provisions releasing, exculpating or exempting a party from, or requiring indemnification of a party for, liability for its own action or inaction, to the extent the action or inaction involves gross negligence, recklessness, willful misconduct or unlawful conduct, or (iii) may, where less than all of a contract may be unenforceable, limit the enforceability of the balance of the contract to circumstances in which the unenforceable portion is not an essential part of the agreed exchange.

We have also assumed (a) the accuracy and truthfulness of all public records of the Company and of all certifications, documents and other proceedings examined by us that have been produced by officials of the Company acting within the scope of their official capacities, without verifying the accuracy or truthfulness of such representations, (b) the genuineness of such signatures appearing upon such public records, certifications, documents and proceedings, (c) the legal capacity of natural persons who are involved on behalf of the Company to enter into and perform the referenced instrument or agreement or to carry out their role in it, (d) the satisfaction by each party to the referenced instrument or agreement (other than the Company) of those legal requirements that are applicable to it to the extent necessary to make the referenced instrument or agreement enforceable against it, (e) the compliance by each party to the referenced instrument or agreement (other than the Company) with all legal requirements pertaining to its status as such status relates to its rights to enforce such instrument or agreement against the Company, (f) the accuracy and completeness of each document submitted for review and the authenticity of each such document that is an original or, if such document is a copy, its conformance to an authentic original, (g) the absence of any mutual mistake of fact or misunderstanding, fraud, duress or undue influence, and (h) the compliance of the conduct of the parties to the referenced instrument or agreement with any requirement of good faith, fair dealing and conscionability.

We are members of the Bar of the State of Minnesota, and the foregoing opinion is limited to the existing laws of the State of Minnesota, the existing federal laws of the United States of America and, with respect to the valid and binding nature of the Indenture, the existing laws of the State of New York. We express no opinion as to the laws of any other jurisdiction. The opinion herein expressed is rendered only with respect to the laws, and the rules, regulations and orders under those laws, that are currently in effect. By rendering this opinion, we do not undertake to advise the Company with respect to any other matter or of any change in such laws or in the interpretation thereof which may occur after the date hereof.

The Valspar Corporation

Page 3

July 27, 2015

 

We hereby consent to the filing of this opinion as an exhibit to a Current Report on Form 8-K of the Company filed with the Commission and thereby incorporated by reference into the Registration Statement and to being named in the Prospectus included therein under the caption “Legal Matters” with respect to matters stated therein, without implying or admitting that we are an “expert” within the meaning of the Securities Act, or other rules and regulations of the Commission issued thereunder with respect to any part of the Registration Statement, including this exhibit. This opinion letter is limited to the matters set forth herein, and no opinion may be inferred or implied beyond the matters expressly set forth herein. This opinion letter is not a guaranty nor may one be inferred or implied. Mr. Rolf Engh, Executive Vice President and General Counsel of the Company, may rely on this opinion in rendering his opinion to be dated the date hereof and filed as Exhibit 99.1 to the Current Report on Form 8-K of the Company filed with the Commission concurrently herewith.

This opinion speaks only as of the date hereof and is intended solely for use in connection with the issuance and sale of the Securities subject to the Registration Statement and is not to be relied upon for any other purpose.

 

Very truly yours,
/s/ Maslon LLP
MASLON LLP
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