EXHIBIT 10.6
EXECUTION COPY
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CORPORATE AGREEMENT
Dated as of July 23, 1996
between
CALCOMP TECHNOLOGY, INC.,
a Delaware corporation
and
LOCKHEED XXXXXX CORPORATION,
a Maryland corporation
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CORPORATE AGREEMENT
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THIS CORPORATE AGREEMENT ("Agreement") is entered into as of July 23,
1996, by and between LOCKHEED XXXXXX CORPORATION, a Maryland corporation
("Lockheed Xxxxxx"), and CALCOMP TECHNOLOGY, INC., a Delaware corporation
("CalComp Technology").
WHEREAS, pursuant to Section 5.2(f) and 6.2 of the Plan of
Reorganization and Agreement for the Exchange of Stock of CalComp Inc. for Stock
of Summagraphics Corporation dated as of the 19th day of March, 1996, as amended
(the "Reorganization Agreement"), by and among Summagraphics Corporation
("Summagraphics"), Lockheed Xxxxxx and CalComp Inc., a California corporation,
Summagraphics and Lockheed Xxxxxx agreed to execute and deliver this Agreement
at the closing (the "Closing") of the transactions contemplated by the
Reorganization Agreement;
WHEREAS, pursuant to the Reorganization Agreement, Summagraphics
agreed to issue and deliver to Lockheed Xxxxxx shares representing 89.7% of
Summagraphics' outstanding Common Stock, par value $.01 per share, on a fully
diluted basis, in exchange for the transfer and delivery of all the issued and
outstanding capital stock of CalComp to Summagraphics, all pursuant to and in
accordance with the terms of the Reorganization Agreement;
WHEREAS, the parties desire to enter into this Agreement to set forth
their agreement regarding (i) the agreement of CalComp Technology to cause to be
nominated for election to its board of directors individuals designated by
Lockheed Xxxxxx (ii) the agreement of the parties that at least two of the
members of the board of directors of CalComp Technology be independent
directors, and (iii) certain representations, warranties, covenants and
agreements applicable to CalComp Technology so long as it is a Subsidiary of
Lockheed Xxxxxx; and
WHEREAS, simultaneously with the execution and delivery of this
Agreement, the Closing has occurred.
NOW, THEREFORE, in consideration of the foregoing, and for other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, Summagraphics and Lockheed Xxxxxx agree as follows:
ARTICLE I
DEFINITIONS
1.1. Definitions. As used in this Agreement, the following terms
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will have the following meanings, applicable both to the singular and the plural
forms of the terms described:
"Agreement" has the meaning ascribed thereto in the preamble hereto,
as such agreement may be amended and supplemented from time to time in
accordance with its terms.
"Applicable Stock" means at any time the total shares of Common Stock
of CalComp Technology owned by the Lockheed Xxxxxx Entities that (i) was owned
on the date hereof, plus (ii) shares of Common Stock of CalComp Technology
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acquired by the Lockheed Xxxxxx Entities following the Closing, if any, plus
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(iii) shares of Common Stock that were issued to Lockheed Xxxxxx Entities in
respect of shares described in either clause (i) or clause (ii) in a stock
split, stock dividend or similar transaction.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
in effect from time to time.
"Lockheed Xxxxxx" has the meaning ascribed thereto in the preamble
hereto.
"Lockheed Xxxxxx Entities" means Lockheed Xxxxxx and its Subsidiaries
(other than Subsidiaries that constitute CalComp Technology Entities) and
"Lockheed Xxxxxx Entity" shall mean any of the Lockheed Xxxxxx Entities.
"Ownership Percentage" means, at any time, the fraction, expressed as
a percentage and rounded to the next highest thousandth of a percent, whose
numerator is the number of shares of Applicable Stock and whose denominator is
the number of outstanding shares of Common Stock of CalComp Technology.
"Person" means any individual, partnership, limited liability company,
joint venture, corporation, trust, unincorporated organization, government (and
any department or agency thereof) or other entity.
"Plan" has the meaning ascribed thereto in Section 3.2(b).
"Reorganization Agreement" has the meaning ascribed thereto in the
preamble hereto.
"Subsidiary" means, as to any Person, any corporation, association,
partnership, joint venture, limited liability company or other business entity
of which more than 50% of the voting capital stock or other voting ownership
interests is owned or controlled directly or indirectly by such Person or by one
or more of the Subsidiaries of such Person or by a combination thereof.
Subsidiary, when used with respect to Lockheed Xxxxxx or CalComp Technology,
shall also include any other entity affiliated with Lockheed Xxxxxx or CalComp
Technology, as the case may be, that Lockheed Xxxxxx and CalComp Technology may
hereafter agree in writing shall be treated as a "Subsidiary" for the purposes
of this Agreement.
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"CalComp Technology" has the meaning ascribed thereto in the preamble
hereto.
"CalComp Technology Entities" means CalComp Technology and its
Subsidiaries (including, without limitation, CalComp and its Subsidiaries).
1.2. Internal References. Unless the context indicates otherwise,
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references to Articles, Sections and paragraphs shall refer to the corresponding
articles, sections and paragraphs in this Agreement and references to the
parties shall mean the parties to this Agreement.
ARTICLE II
BOARD OF DIRECTORS
2.1. Lockheed Xxxxxx Directors. CalComp Technology covenants and
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agrees, for so long as the Ownership Percentage is equal to or greater than
50.000 percent, to propose, at each election of directors, a slate of directors,
or in the cases of vacancies, individual directors, for election so that at all
times during the term of this Agreement, at least 66 percent of the board of
directors of CalComp Technology is comprised of persons designated by Lockheed
Xxxxxx.
2.2. Independent Directors. CalComp Technology and Lockheed Xxxxxx
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shall each use its good faith efforts to cause at least two individual directors
to be independent directors with respect to both CalComp Technology and Lockheed
Xxxxxx within the meaning of the rules of the New York Stock Exchange regarding
who may serve on the audit committee of a company listed on such exchange (as
such rules are in effect as of the date of this Agreement).
ARTICLE III
CERTAIN COVENANTS AND AGREEMENTS
3.1. No Violations. (a) For so long as the Ownership Percentage is
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equal to or greater than 50.000 percent, CalComp Technology covenants and agrees
that it will not take any action or enter into any commitment or agreement which
may reasonably be anticipated to result, with or without notice and with or
without lapse of time, or otherwise, in a contravention or event of default by
any Lockheed Xxxxxx Entity of (i) any provision of applicable law or regulation,
including but not limited to provisions pertaining to ERISA, (ii) any provision
of Lockheed Xxxxxx'x certificate of incorporation or bylaws, (iii) any credit
agreement or other material instrument binding upon any Lockheed Xxxxxx Entity,
or (iv) any judgment, order or decree of any governmental body, agency or court
having jurisdiction over any Lockheed Xxxxxx Entity.
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(b) CalComp Technology and Lockheed Xxxxxx each agrees to
provide to the other any information and documentation requested by the other
for the purpose of evaluating and ensuring compliance with Section 3.1(a)
hereof. Lockheed Xxxxxx agrees to use its reasonable efforts to exclude CalComp
Technology in the future from the express coverage of the restrictive provisions
referenced in Section 3.1(a).
(c) Notwithstanding the foregoing Sections 3.1(a) and 3.1(b)
nothing in this Agreement is intended to limit or restrict in any way the
ability of Lockheed Xxxxxx to control or limit any action or proposed action of
CalComp Technology, including, but not limited to, the incurrence by CalComp
Technology of indebtedness, based upon Lockheed Xxxxxx'x internal policies or
other factors.
3.2. ERISA Covenants. (a) For so long as the Ownership Percentage is
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equal to or greater than 50.000 percent, CalComp Technology covenants and agrees
that it will not, and it will not permit any CalComp Technology Entities to,
without the prior written consent of Lockheed Xxxxxx, take any action or enter
into any commitment or agreement which may reasonably be anticipated to result
in, with or without notice and with or without lapse of time, or otherwise, (i)
any material increase in liabilities required to be included in the consolidated
financial statements of CalComp Technology and its Subsidiaries under the
provisions of the Statement of Financial Accounting Standards No. 87 promulgated
by the Financial Accounting Standards Board, or (ii) any material increase in
liabilities required to be included in the consolidated financial statements of
CalComp Technology and its Subsidiaries under the provisions of the Statement of
Financial Accounting Standards No. 106 promulgated by the Financial Accounting
Standards Board.
(b) For so long as the Ownership Percentage is equal to or
greater than 50.000 percent, CalComp Technology covenants and agrees that it
will provide to Lockheed Xxxxxx, within 15 days after each fiscal quarter, a
list and description of each employee benefit plan within the meaning of ERISA
Section 3(3), excluding plans sponsored by Lockheed Xxxxxx Entities that are not
CalComp Technology Entities (each, a "Plan") which was adopted, contributed to
or maintained by CalComp Technology or any CalComp Technology Entities during
the fiscal quarter immediately preceding the date of such list and shall
separately identify each Plan for which CalComp Technology has (i) sought a
waiver of the minimum funding standard under Section 412 of the Internal Revenue
Code, (ii) failed to make any contribution or payment or made any amendment
which has resulted or could result in the imposition of a material lien or the
posting of a material bond or other material security under ERISA or the
Internal Revenue Code or (iii) incurred any material liability under Title IV of
ERISA other than a liability to the PBGC for premiums under Section 4007 of
ERISA.
(c) For so long as the Ownership Percentage is equal to or
greater than 50.000 percent, CalComp Technology covenants and
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agrees that it will not, without the prior written consent of Lockheed Xxxxxx,
materially increase its obligations under any Plan contributed to, maintained or
adopted prior to or following the date hereof or adopt any new Plan which would
materially increase CalComp Technology's benefits obligations.
ARTICLE IV
MISCELLANEOUS
4.1. Limitation of Liability. Neither Lockheed Xxxxxx nor CalComp
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Technology shall be liable to the other for any special, indirect, incidental or
consequential damages of the other arising in connection with this Agreement.
4.2. Arbitration. (a) Any controversy or claim arising out of or
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relating to this Agreement, or the breach thereof, shall be settled by
arbitration in accordance with the Commercial Rules of the American Arbitration
Association ("AAA") by a panel of three neutral arbitrators (the "Panel") in
Chicago, Illinois, or any other location agreed to by the parties, and judgment
upon the award of the arbitrators may be entered in any court having
jurisdiction.
(b) One of the arbitrators shall be a member of the bar of any
state, actively engaged in the practice of law, or a retired member of the state
or federal judiciary. The other two arbitrators shall have such qualifications,
as the parties may agree, as necessitated by the nature of the dispute. If
unable to agree on the qualifications of the remaining arbitrators, the makeup
of the panel shall be determined by the AAA.
(c) The Panel shall have the authority to order pre-hearing
exchanges of information, including and without limitation, production of
requested documents, exchange of summaries of testimony or prospective
witnesses, and depositions as may be necessary.
(d) Each party shall be responsible for its own costs incurred
in any arbitration and the Panel shall not have the authority to award such
costs in its decision. The Panel shall have the authority to assess the
administrative fees and expenses of the AAA and the compensation and expenses of
the arbitrators.
(e) The Panel shall have the authority to order specific
performance, but shall have no authority to award punitive damages. The Panel's
award shall be based on and accompanied by written findings of fact.
4.3. Amendments. This Agreement may not be amended or terminated
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orally, but only by a writing duly executed by or on behalf of the parties
hereto. Any such amendment shall be validly and sufficiently authorized for
purposes of this Agreement if it is signed on behalf of Lockheed Xxxxxx and
CalComp Technology by any
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of their respective presidents or vice presidents, who is not also an officer of
the other party.
4.4. Term. This Agreement shall remain in effect until such time as
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the Percentage Ownership is less than 50.000 percent.
4.5. Severability. If any provision of this Agreement or the
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application of any such provision to any party or circumstances shall be
determined by any court of competent jurisdiction or duly authorized arbitration
tribunal to be invalid, illegal or unenforceable to any extent, the remainder of
this Agreement or such provision of the application of such provision to such
party or circumstances, other than those to which it is so determined to be
invalid, illegal or unenforceable, shall remain in full force and effect to the
fullest extent permitted by law and shall not be affected thereby, unless such a
construction would be unreasonable.
4.6. Notices. All notices and other communications required or
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permitted hereunder shall be in writing, shall be deemed duly given upon actual
receipt, and shall be delivered (a) in person, (b) by registered or certified
mail, postage prepaid, return receipt requested, or (c) by facsimile or other
generally accepted means of electronic transmission (provided that a copy of any
notice delivered pursuant to this clause (c) shall also be sent pursuant to
clause (b), addressed as follows:
(a) If to CalComp Technology, to:
CalComp Technology, Inc.
0000 X. XxXxxxx Xxxxxx
Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxx X. Xxxx, President
Telecopy No.: (000) 000-0000
(b) If to Lockheed Xxxxxx, to:
Lockheed Xxxxxx Corporation
0000 Xxxxxxxxx Xxxxx
Xxxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxx, Esquire
Assistant General Counsel
Telecopy No.: (000) 000-0000
with a copy to:
Lockheed Xxxxxx Information
& Technology Services
0000 Xxxxxxxxx Xxxxx
Xxxxxxxx, Xxxxxxxx 00000
Attention: General Counsel
Telecopy No.: (000) 000-0000
or to such other addresses or telecopy numbers as may be specified by like
notice to the other parties.
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4.7. Further Assurances. Lockheed Xxxxxx and CalComp Technology
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shall execute, acknowledge and deliver, or cause to be executed, acknowledged
and delivered, such instruments and take such other action as may be necessary
or advisable to carry out their obligations under this Agreement and under any
exhibit, document or other instrument delivered pursuant hereto.
4.8. Counterparts. This Agreement may be executed in any number of
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counterparts, each of which shall be deemed an original instrument, but all of
which together shall constitute but one and the same agreement.
4.9. Governing Law. This Agreement and the transactions contemplated
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hereby shall be construed in accordance with, and governed by, the laws of the
State of Delaware.
4.10. Entire Agreement. This Agreement constitutes the entire
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understanding of the parties hereto with respect to the subject matter hereof.
4.11. Successors. This Agreement shall be binding upon, and shall
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inure to the benefit of, the parties hereto and their respective successors and
assigns. Nothing contained in this Agreement, express or implied, is intended
to confer upon any other person or entity any benefits, rights or remedies.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement,
under seal and with the intent that this Agreement shall constitute a sealed
instrument, the day and year first above written.
LOCKHEED XXXXXX CORPORATION
[CORPORATE SEAL] By:/s/ XXXXX X. XXXXX
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Xxxxx X. Xxxxx
Vice President and President
and Chief Operating
Officer, Information &
Technology Services Sector
ATTEST:
______________________________
Secretary
CALCOMP TECHNOLOGY, INC.
[CORPORATE SEAL] By:/s/ XXXXXXX X. XXXXXXX
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Xxxxxxx X. Xxxxxxx
President and Chief Executive
Officer
ATTEST:
______________________________
Secretary
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