EXHIBIT 10.3
L-3 COMMUNICATIONS CORPORATION
10 3/8% Senior Subordinated Notes due 2007
PURCHASE AGREEMENT
April 25, 1997
Xxxxxx Brothers Inc.
BancAmerica Securities, Inc.
c/x Xxxxxx Brothers Inc.
Three World Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
L-3 Communications Corporation, a Delaware corporation (the
"Company"), proposes to issue and sell to you (the "Initial Purchasers")
$225.0 million in aggregate principal amount of its 10 3/8% Senior
Subordinated Notes due 2007 (the "Series A Notes") pursuant to the terms of
an Indenture (the "Indenture") between the Company and The Bank of New York,
as trustee (the "Trustee"), relating to the Series A Notes. Capitalized
terms used but not defined herein shall have the meanings given to such terms
in the Indenture.
The Series A Notes will be offered and sold to you pursuant
to an exemption from the registration requirements under the Securities Act
of 1933, as amended (the "Act"). The Company has prepared a preliminary
offering memorandum (the "Preliminary Offering Memorandum"), dated April 11,
1997, and a final offering memorandum (the "Offering Memorandum"), dated
April 25, 1997, relating to the Company and the Series A Notes. As described
in the Offering Memorandum, the Company will use all of the net proceeds from
the offering of the Series A Notes to pay, in part, the $480.0 million (prior
to adjustments and reductions) cash portion of the purchase price of certain
businesses and assets (the "Acquired Businesses") to be acquired by the
Company from Lockheed Xxxxxx Corporation pursuant to the Acquisition
Documents (as defined herein).
Upon original issuance thereof, and until such time as the
same is no longer required under the applicable requirements of the Act, the
Series A Notes (and all securities issued in exchange therefor or in
substitution thereof) shall bear the following legend:
"THE SECURITY (OR ITS PREDECESSOR) EVIDENCED HEREBY WAS
ORIGINALLY ISSUED IN A TRANSACTION EXEMPT FROM REGISTRATION
UNDER XXXXXXX 0 XX XXX XXXXXX XXXXXX SECURITIES ACT OF 1933,
AS AMENDED (THE "SECURITIES ACT"), AND THE SECURITY
EVIDENCED HEREBY MAY NOT BE OFFERED, SOLD OR OTHERWISE
TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN
APPLICABLE EXEMPTION THEREFROM. EACH PURCHASER OF THE
SECURITY EVIDENCED HEREBY IS HEREBY NOTIFIED THAT THE SELLER
MAY BE RELYING ON THE EXEMPTION FROM THE PROVISION OF
SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A
THEREUNDER. THE HOLDER OF THE SECURITY EVIDENCED HEREBY
AGREES FOR THE BENEFIT OF THE COMPANY THAT (A) SUCH SECURITY
MAY BE RESOLD, PLEDGED OR OTHERWISE TRANSFERRED, ONLY (1)
(a) TO A PERSON WHO THE SELLER REASONABLY BELIEVES IS A
QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A UNDER
THE SECURITIES ACT) IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 144A, (b) IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 144 UNDER THE SECURITIES ACT, (c)
OUTSIDE THE UNITED STATES TO A FOREIGN PERSON IN A
TRANSACTION MEETING THE REQUIREMENTS OF RULE 904 UNDER THE
SECURITIES ACT OR (d) IN ACCORDANCE WITH ANOTHER EXEMPTION
FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT
(AND BASED UPON AN OPINION OF COUNSEL IF THE COMPANY SO
REQUESTS), (2) TO THE COMPANY OR (3) PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT, IN EACH CASE, IN
ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE
OF THE UNITED STATES OR ANY OTHER APPLICABLE JURISDICTION
AND (B) THE HOLDER WILL, AND EACH SUBSEQUENT HOLDER IS
REQUIRED TO, NOTIFY ANY PURCHASER FROM IT OF THE SECURITY
EVIDENCED HEREBY OF THE RESALE RESTRICTIONS SET FORTH IN (A)
ABOVE."
You have advised the Company that you will make offers (the
"Exempt Resales") of the Series A Notes purchased by you hereunder on the
terms set forth in the Offering Memorandum, as amended or supplemented,
solely to (i) persons whom you reasonably believe to be "qualified
institutional buyers" as defined in Rule 144A under the Act ("QIBs"), (ii) a
limited number of other institutional "accredited investors," as defined in
Rule 501(a) (1), (2), (3) and (7) under the Act, who execute a letter
containing certain representations and agreements in the form set forth as
Annex A to the Offering Memorandum (each, an "Accredited Institution") and
(iii) outside the United States to persons other than U.S. Persons in
offshore transactions meeting the requirements of Rule 904 of Regulation S
("Regulations S") under the Act (such persons specified in clauses (i)
through (iii) being referred to herein as the "Eligible Purchasers"). As
used herein, the terms "offshore transaction," "United States" and "U.S.
person" have the respective meanings given to them in Regulation S. You will
offer the Series A Notes to Eligible Purchasers initially at a price equal to
100% of the principal amount thereof. Such price may be changed at any time
without notice.
Holders (including subsequent transferees) of the Series A
Notes will have the registration rights set forth in the registration rights
agreement (the "Registration Rights Agreement"), to be dated April 30, 1997
(the "Closing Date"), in the form of Exhibit A hereto, for so long as such
Series A Notes constitute "Transfer Restricted Securities" (as defined in the
Registration Rights Agreement). Pursuant to the Registration Rights
Agreement, the Company will agree to file with the Securities and Exchange
Commission (the "Commission") under the circumstances set forth therein, (i)
a registration statement under the Act (the "Exchange Offer Registration
Statement") relating to the Company's 10 3/8% Senior Subordinated Notes due
2007 (the "Series B Notes" and, together with the Series A Notes, the
"Notes") to be offered in exchange for the Series A Notes, (such offer to
exchange being referred to collectively as the "Registered Exchange Offer")
and (ii) a shelf registration statement pursuant to Rule 415 under the Act
(the "Shelf Registration Statement") relating to the resale by certain
holders of the Series A Notes, and to use its best efforts to cause such
Registration Statements to be declared effective. This Agreement, the
Indenture and the Registration Rights Agreement are hereinafter referred to
collectively as the "Operative Documents." This is to confirm the agreements
concerning the purchase of the Series A Notes from the Company by you.
1. Representations, Warranties and Agreements of the
Company. The Company represents, warrants and agrees as follows (all of such
representations and warranties shall be deemed to include the Acquired
Businesses, and all references to the Company in this section shall assume
that the Company has acquired the Acquired Businesses as of the date hereof):
(a) The Preliminary Offering Memorandum and Offering
Memorandum have been prepared by the Company for use by the Initial
Purchasers in connection with the Exempt Resales. No order or decree
preventing the use of the Preliminary Offering Memorandum or the Offering
Memorandum, or any order asserting that the transactions contemplated by this
Agreement are subject to the registration requirements of the Act has been
issued and no proceeding for that purpose has commenced or is pending or, to
the knowledge of the Company, is contemplated.
(b) The Preliminary Offering Memorandum and the Offering
Memorandum as of their respective dates and the Offering Memorandum as of the
Closing Date, did not and will not contain an untrue statement of a material
fact or omit to state a material fact necessary, in order to make the
statements, in light of the circumstances under which they were made, not
misleading, except that this representation and warranty does not apply to
statements in or omissions from the Preliminary Offering Memorandum and
Offering Memorandum made in reliance upon and in conformity with information
relating to the Initial Purchasers furnished to the Company in writing by or
on behalf of the Initial Purchasers expressly for use therein.
(c) The market-related and customer-related data and
estimates included in the Preliminary Offering Memorandum and the Offering
Memorandum are based on or derived from sources which the Company believes to
be reliable and accurate.
(d) The Company is a corporation duly incorporated and
validly existing and in good standing under the laws of Delaware with full
corporate power and authority to own, lease and operate its properties and to
conduct its business, and will be on or prior to the Closing Date duly
registered and qualified to conduct its business and will be on or prior to
the Closing Date in good standing in each jurisdiction or place where the
nature of its properties or the conduct of its business requires such
registration or qualification, except where the failure so to register or
qualify or to be in good standing does not have a material adverse effect on
the condition (financial or other), business, prospects, properties,
shareholders' equity or results of operations of the Company (a "Material
Adverse Effect").
(e) The Company has all requisite power and authority to
execute, deliver and perform its obligations under this Agreement, the
Indenture, the Notes and the Registration Rights Agreement.
(f) This Agreement has been duly and validly authorized,
executed and delivered by the Company and, assuming due authorization,
execution and delivery by the Initial Purchasers, constitutes the valid and
binding agreement of the Company, enforceable against the Company in
accordance with its terms, subject to the effects of bankruptcy, insolvency,
fraudulent conveyance, reorganization, moratorium and other similar laws
relating to or affecting creditors' rights generally, general equitable
principles (whether considered in a proceeding in equity or at law) and an
implied covenant of good faith and fair dealing and except as rights to
indemnity and contribution hereunder may be limited by Federal or state
securities laws or principles of public policy.
(g) The Registration Rights Agreement has been duly and
validly authorized by the Company and, upon its execution and delivery by the
Company and, assuming due authorization, execution and delivery by the
Initial Purchasers, will constitute the valid and binding agreement of the
Company, enforceable against the Company in accordance with its terms,
subject to the effects of bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and other similar laws relating to or affecting
creditors' rights generally, general equitable principles (whether considered
in a proceeding in equity or at law) and an implied covenant of good faith
and fair dealing may be limited by Federal or state securities laws or
principles of public policy.
(h) The Indenture has been duly and validly authorized
by the Company, and upon its execution and delivery and, assuming due
authorization, execution and delivery by the Trustee, will constitute the
valid and binding agreement of the Company, enforceable against the Company
in accordance with its terms subject to the effects of bankruptcy,
insolvency, fraudulent conveyance, reorganization, moratorium and other
similar laws relating to or affecting creditors' rights generally, general
equitable principles (whether considered in a proceeding in equity or at law)
and an implied covenant of good faith and fair dealing; no qualification of
the Indenture under the 1939 Act is required in connection with the offer and
sale of the Series A Notes contemplated hereby or in connection with the
Exempt Resales.
(i) The Series A Notes have been duly and validly
authorized by the Company and when duly executed by the Company in accordance
with the terms of the Indenture and, assuming due authentication of the
Series A Notes by the Trustee, upon delivery to the Initial Purchasers
against payment therefor in accordance with the terms hereof, will have been
validly issued and delivered, and will constitute valid and binding
obligations of the Company entitled to the benefits of the Indenture,
enforceable against the Company in accordance with their terms, subject to
the effects of bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium and other similar laws relating to or affecting creditors' rights
generally, general equitable principles (whether considered in a proceeding
in equity or at law) and an implied covenant of good faith and fair dealing.
(j) The Series B Notes have been duly and validly
authorized by the Company and if and when duly issued and authenticated in
accordance with the terms of the Indenture and delivered in accordance with
the Exchange Offer provided for in the Registration Rights Agreement, will
constitute valid and binding obligations of the Company entitled to the
benefits of the Indenture, enforceable against the Company in accordance with
their terms, subject to the effects of bankruptcy, insolvency, fraudulent
conveyance, reorganization, moratorium and other similar laws relating to or
affecting creditors' rights generally, general equitable principles (whether
considered in a proceeding in equity or at law) and an implied covenant of
good faith and fair dealing.
(k) Each of the credit agreement (the "Credit
Agreement"), dated April 30, 1997, by and among the Company, Xxxxxx
Commercial Paper Inc. and Bank of America NT & SA and any and all other
agreements and instruments ancillary to or entered into in connection with
the transaction contemplated by the Credit Agreement (together with the
Credit Agreement, the "Credit Documents") has been duly and validly
authorized, executed and delivered by the Company and, assuming due
authorization, execution and delivery by the other parties thereto,
constitutes the valid and binding agreement of the Company, enforceable
against the Company in accordance with its terms, subject to the
qualification that the enforceability of the Company's obligations thereunder
may be limited by bankruptcy, fraudulent conveyance, insolvency,
reorganization, moratorium, and other laws relating to or affecting
creditors' rights generally and by general equitable principles.
(l) The Company has all requisite corporate power and
authority to enter into or assume the rights and obligations under, as
applicable, (i) the transaction agreement (the "Transaction Agreement"),
dated as of March 28, 1997, by and among Lockheed Xxxxxx Corporation, Xxxxxx
Brothers Capital Partners III, L.P., Xxxxx X. Xxxxx, Xxxxxx X. XxXxxxx and L-
3 Communications Holdings, Inc. and (ii) any and all other agreements and
side letters (excluding the common stock subscription agreement to be entered
into by Lockheed Xxxxxx Corporation, Xxxxxx Brothers Capital Partners III,
L.P. Xxxxx X. Xxxxx, Xxxxxx X. XxXxxxx and L-3 Communications Holdings, Inc.)
ancillary to or entered into in connection with the transaction contemplated
by the Transaction Agreement (items (i) and (ii) are referred to collectively
as the "Acquisition Documents").
(m) Each of the Transaction Agreement, the other
Acquisition Documents and/or any assignment agreement pertaining thereto, as
applicable, between L-3 Communications Holdings, Inc. and the Company, has
been duly and validly authorized, and when executed and delivered by the
Company, and, assuming due authorization, execution and delivery by the other
parties thereto, will constitute the valid and binding agreement of the
Company, enforceable against the Company in accordance with its terms,
subject to the qualification that the enforceability of the Company's
obligations thereunder may be limited by bankruptcy, fraudulent conveyance,
insolvency, reorganization, moratorium, and other laws relating to or
affecting creditors' rights generally and by general equitable principles.
(n) All the shares of capital stock of the Company
outstanding prior to the issuance of the Series A Notes have been duly
authorized and validly issued and are fully paid and nonassessable and the
authorized capital stock of the Company conforms to the description thereof
under the caption "Capitalization" in the Offering Memorandum. The Company
does not have any subsidiaries.
(o) There are no legal or governmental proceedings
pending or, to the knowledge of the Company, threatened, against the Company
or to which any of its properties, is subject, that are not disclosed in the
Offering Memorandum and which, if adversely decided, are reasonably likely to
cause a Material Adverse Effect. The Company is not involved in any strike,
job action or labor dispute with any group of employees that would have a
Material Adverse Effect, and, to the Company's knowledge, no such action or
dispute is threatened.
(p) No material relationship, direct or indirect, exists
between or among the Company on the one hand, and the directors, officers,
stockholders, customers or suppliers of the Company on the other hand, except
as described in the Offering Memorandum.
(q) The Company (i) is not in violation of its
certificate of incorporation, by-laws or other organizational document, (ii)
is not in default in any material respect, and no event has occurred which,
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 it is a party or by which it is bound or to which any of
its properties or assets is subject that is material to the Company's
financial condition or prospects (collectively, the "Material Agreements") or
(iii) is not in violation in any material respect of any law, statute,
ordinance, governmental rule, regulation, filing or injunction or court
decree to which it or its property or assets is subject or has failed to
obtain any material license, permit, certificate, franchise or other
governmental authorization or permit necessary to the ownership of its
property or to the conduct of its business, except as would not,
individually, or in the aggregate, have a Material Adverse Effect.
(r) None of the issuance, offer or sale of the Series A
Notes, the execution, delivery or performance by the Company of this
Agreement or the other Operative Documents, compliance by the Company with
the provisions hereof or thereof nor consummation by the Company of the
transactions contemplated hereby or thereby; none of the execution, delivery
or performance by the Company of the Credit Agreement or the other Credit
Documents, compliance by the Company with the provisions thereof nor
consummation by the Company of the transactions contemplated thereby; and
none of the execution, delivery or performance by the Company of the
Transaction Agreement, the other Acquisition Documents and/or any assignment
agreement pertaining thereto between L-3 Communications Holdings, Inc. and
the Company, as the case may be, compliance by the Company with the
provisions thereof nor consummation by the Company of the transactions
contemplated thereby (i) requires any consent, approval, authorization or
other order of, or registration or filing with, any court, regulatory body,
administrative agency or other governmental body, agency or official (except
such as may be required in connection with the registration under the Act of
the Series B Notes in accordance with the Registration Rights Agreement,
qualification of the Indenture under the 1939 Act and compliance with the
securities or Blue Sky laws of various jurisdictions and except as required
by the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 1976, as amended, and
except the consents specified by Exhibit B hereto), or conflicts or will
conflict with or constitutes or will constitute a breach of, or a default
under, the certificate of incorporation or bylaws, or other organizational
documents, of the Company or (ii) conflicts or will conflict with or
constitutes or will constitute a breach of, or a default under any Material
Agreement or will violate any material law, statute, ordinance, governmental
rule, regulation, filing or injunction or court decree to which it or its
property or assets is subject or will result in the creation or imposition of
any lien, charge or encumbrance upon any material property or assets of the
Company pursuant to the terms of any agreement or instrument to which it is a
party or to which any of its property or assets is subject.
(s) The accountants, Coopers & Xxxxxxx L.L.P., who have
certified certain of the financial statements included as part of the
Offering Memorandum, are independent public accountants under Rule 101 of the
AICPA's Code of Professional Conduct, and its interpretation and rulings.
(t) The accountants, Ernst & Young LLP, who have
certified certain of the financial statements included as part of the
Offering Memorandum, are independent public accountants under Rule 101 of the
AICPA's Code of Professional Conduct, and its interpretation and rulings.
(u) The historical and pro forma financial statements,
together with related notes, set forth in the Offering Memorandum (excluding
Summary-Unaudited Pro Forma and Supplemental Adjusted Historical Financial
Data and Unaudited Supplemental Adjusted Historical Financial Data) comply as
to form in all material respects with the requirements of Regulation S-X
under the Act applicable to registration statements on Form S-1 under the
Act. Such historical financial statements fairly present the financial
position of the Company (or its predecessor) at the respective dates
indicated and the results of operations and cash flows for the respective
periods indicated, in accordance with GAAP consistently applied throughout
such periods. Such pro forma financial statements have been prepared on a
basis consistent with such historical statements, except for the pro forma
adjustments specified therein, and give effect to assumptions made on a
reasonable basis and in good faith and present fairly the historical and
proposed transactions contemplated by the Offering Memorandum and this
Agreement. The other financial and statistical information and data included
in the Offering Memorandum (including Summary-Unaudited Pro Forma and
Supplemental Adjusted Historical Financial Data and Unaudited Supplemental
Adjusted Historical Financial Data), historical and pro forma, have been
derived from the financial records of the Lockheed Xxxxxx Predecessor
Businesses and the Loral Acquired Businesses (each as defined in the Offering
Memorandum) and, in all material respects, have been prepared on a basis
consistent with such books and records of the Company (or its predecessor),
except as disclosed therein.
(v) Except as disclosed in, or specifically contemplated
by, the Offering Memorandum, subsequent to the date as of which such
information is given in the Offering Memorandum, the Company has not incurred
any liability or obligation, direct or contingent, or entered into any
transaction, in each case not in the ordinary course of business, that is
material to the Company, and there has not been any material change in the
capital stock, or material increase in the short-term or long-term debt, of
the Company or any material adverse change, or any development involving or
which would reasonably be expected to involve a prospective material adverse
change, in the condition (financial or other), business, properties,
shareholders' equity, results of operations or prospects of the Company.
(w) The Company will, on or prior to the Closing Date,
have good and marketable title to all property (real and personal) described
in the Offering Memorandum as being owned by it, free and clear of all liens,
claims, security interests or other encumbrances except such as are described
in the Offering Memorandum or, to the extent that any such liens, claims,
security interests or other encumbrances would not have a Material Adverse
Effect (individually or in the aggregate) and all the material property
described in the Offering Memorandum as being held under lease by the Company
is held by it under valid, subsisting and enforceable leases, with only such
exceptions as in the aggregate would not have a Material Adverse Effect.
(x) The Company will, on or prior to the Closing date,
own all material patents, trademarks, service marks, trade names, copyrights,
licenses, inventions, trade secrets and other rights, and all registrations
or applications relating thereto, described in the Offering Memorandum as
being owned by it or necessary for the conduct of its business, except as
such would not have a Material Adverse Effect, and the Company is not aware
of any pending or threatened claim to the contrary or any pending or
threatened challenge by any other person to the rights of the Company with
respect to the foregoing which, if determined adversely to the Company would
have a Material Adverse Effect.
(y) The Company will, on or prior to the Closing Date,
have all material permits, licenses, franchises, certificates of need and
other approvals or authorizations of governmental or regulatory authorities
("Permits") as are necessary under applicable law to own its properties and
to conduct its business in the manner described in the Offering Memorandum,
except to the extent that the failure to have such Permits would not have a
Material Adverse Effect; the Company has fulfilled and performed in all
material respects, all of its material obligations with respect to the
Permits, and no event has occurred which allows, or after notice or lapse of
time would allow, revocation or termination thereof or results in any other
material impairment of the rights of the holder of any such Permit, subject
in each case to such qualification as may be set forth in the Offering
Memorandum and except to the extent that any such revocation or termination
would not have a Material Adverse Effect.
(z) To the best of the Company's knowledge, neither the
Company nor any director, officer, agent, employee or other person associated
with or acting on behalf of the Company, has used any corporate funds for any
unlawful contribution, gift, entertainment or other unlawful expense relating
to political activity; made any direct or indirect unlawful payment to any
foreign or domestic government official or employee from corporate funds or
violated or is in violation of any provision of the Foreign Corrupt Practices
Act of 1977 except such that would not have a Material Adverse Effect.
(aa) The Company is not and, upon sale of the Series A
Notes to be issued and sold thereby in accordance herewith and the
application of the net proceeds to the Company of such sale as described in
the Offering Memorandum under the caption "Use of Proceeds," will not be an
"investment company" within the meaning of the Investment Company Act of
1940, as amended.
(ab) Neither the Company nor any affiliate (as defined in
Rule 501(b) of Regulation D ("Regulation D") under the Act) of the Company
has directly, or through any agent (provided that no representation is made
as to the Initial Purchasers or any person acting on its behalf), (i) sold,
offered for sale, solicited offers to buy or otherwise negotiated in respect
of, any security (as defined in the Act) which is or could be integrated with
the offering and sale of the Notes in a manner that would require the
registration of the Series A Notes under the Act or (ii) engaged in any form
of general solicitation or general advertising (within the meaning of
Regulation D, including, but not limited to, advertisements, articles,
notices or other communications published in any newspaper, magazine, or
similar medium or broadcast over television or radio, or any seminar or
meeting whose attendees have been invited by any general solicitation or
general advertising) in connection with the offering of the Series A Notes.
No securities of the same class as the Series A Notes have been issued and
sold by the Company within the six-month period immediately prior to the date
hereof.
(ac) Except as permitted by the Act, the Company has not
distributed and, prior to the later to occur of the Closing Date and
completion of the distribution of the Series A Notes, will not distribute any
offering material in connection with the offering and sale of the Series A
Notes other than the Preliminary Offering Memorandum and Offering Memorandum.
(ad) When the Series A Notes are issued and delivered
pursuant to this Agreement, such Series A Notes will not be of the same class
(within the meaning of Rule 144A under the Act) as securities of the Company
that are listed on a national securities exchange registered under Section 6
of the Securities Exchange Act of 1934, as amended (the "Exchange Act") or
that are quoted in a U.S. automated inter-dealer quotation system.
(ae) Assuming (i) that your representations and
warranties in Section 2 are true, (ii) that the representations of the
Accredited Institutions set forth in the certificates of such Accredited
Institutions in the form set forth in Annex A to the Offering Memorandum are
true, (iii) compliance by you with your covenants set forth in Section 2 and
(iv) that each of the Eligible Purchasers is a QIB, an Accredited Institution
or a person who is not a "U.S. person" who acquires the Series A Notes
outside the United States in an "offshore transaction" (within the meaning of
Rule 904 of Regulation S), the purchase of the Series A Notes by you pursuant
hereto and the resale of the Series A Notes pursuant hereto pursuant to the
Exempt Resales is exempt from the registration requirements of the Act.
(af) The Company is in compliance in all material
respects with all presently applicable provisions of the Employee Retirement
Income Security Act of 1974, as amended, including the regulations and
published interpretations thereunder ("ERISA") other than in connection with
acquisition of the Acquired Businesses; no "reportable event" (as defined in
ERISA) has occurred with respect to any "pension plan" (as defined in ERISA)
for which the Company would reasonably expect to incur any material
liability; the Company has not incurred and does not reasonably expect to
incur any material liability under (i) Title IV of ERISA with respect to
termination of, or withdrawal from, any "pension plan" or (ii) Sections 412
or 4971 of the Internal Revenue Code of 1986, as amended, including the
regulations and published interpretations thereunder (the "Code"); (other
than contributions in the normal course which are not in default) and each
"pension plan" for which the Company would have any liability that is
intended to be qualified under Section 401(a) of the Code is expected to be
so qualified in all material respects and nothing has occurred, whether by
action or by failure to act, which would reasonably be expected to cause the
loss of such qualification.
(ag) Except as disclosed in the Offering Memorandum, there
are no contracts, agreements or understandings between the Company and any
person granting such person the right to require the Company to file a
registration statement under the Securities Act with respect to any
securities of the Company owned or to be owned by such person or to require
the Company to include such securities in the securities registered pursuant
to the Exchange Offer Registration Statement, the Shelf Registration
Statement or in any securities being registered pursuant to any other
registration statement filed by the Company under the Securities Act.
(ah) The Company has filed all federal, state and local
income and franchise tax returns required to be filed through the date hereof
and has paid all taxes due thereon, and no tax deficiency has been determined
adversely to the Company nor does the Company have any knowledge of any tax
deficiency which, if determined adversely to the Company, might have a
Material Adverse Effect.
(ai) There has been no storage, disposal, generation,
manufacture, refinement, transportation, handling or treatment of toxic
wastes, medical wastes, hazardous wastes or hazardous substances by the
Company (or, to the knowledge of the Company, any of their predecessors in
interest) at, upon or from any of the property now or previously owned or
leased by the Company in violation of any applicable law, ordinance, rule,
regulation, order, judgment, decree or permit or which would require remedial
action under any applicable law, ordinance, rule, regulation, order,
judgment, decree or permit, except for any violation or remedial action which
would not have, or would not be reasonably likely to have, singularly or in
the aggregate with all such violations and remedial actions, a Material
Adverse Effect; there has been no material spill, discharge, leak, emission,
injection, escape, dumping or release of any kind onto such property or into
the environment surrounding such property of any toxic wastes, medical
wastes, solid wastes, hazardous wastes or hazardous substances due to or
caused by the Company or with respect to which the Company has knowledge,
except for any such spill, discharge, leak, emission, injection, escape,
dumping or release which would not have or would not be reasonably likely to
have, singularly or in the aggregate with all such spills, discharges, leaks,
emissions, injections, escapes, dumpings and releases, a Material Adverse
Effect; and the terms "hazardous wastes," "toxic wastes," "hazardous
substances" and "medical wastes" shall have the meanings specified in any
applicable local, state, federal and foreign laws or regulations with respect
to environmental protection.
(aj) None of the Company or any of its affiliates or any
person acting on its or their behalf has engaged or will engage in any
directed selling efforts within the meaning of Regulation S with respect to
the Notes, and the Company and its affiliates and all persons acting on its
of their behalf have complied with and will comply with the offering
restrictions requirements of Regulation S in connection with the offering of
the Notes outside of the United States. The sales of the Series A Notes
pursuant to Regulation S are "offshore transactions" and are not part of a
plan or scheme to evade the registration provision of the Act. The Company
makes no representation in this paragraph (al) with respect to the Initial
Purchasers.
2. Representations, Warranties and Agreements of the
Initial Purchasers. Each Initial Purchaser represents and warrants with
respect to itself that:
(a) Such Initial Purchaser is either a QIB or an
Accredited Institution, in either case with such knowledge and experience in
financial and business matters as are necessary in order to evaluate the
merits and risks of an investment in the Series A Notes.
(b) Such Initial Purchaser (i) is not acquiring the
Series A Notes with a view to any distribution thereof or with any present
intention of offering or selling any of the Series A Notes in a transaction
that would violate the Act or the securities laws of any State of the United
States or any other applicable jurisdiction; (ii) in connection with the
Exempt Resales, will solicit offers to buy the Notes only from, and will
offer to sell the Notes only to, the Eligible Purchasers in accordance with
this Agreement and on the terms contemplated by the Offering Memorandum; and
(iii) will not offer or sell the Notes, nor has it offered or sold the Notes
by, or otherwise engaged in, any form of general solicitation or general
advertising (within the meaning of Regulation D; including, but not limited
to, advertisements, articles, notices or other communications published in
any newspaper, magazine, or similar medium or broadcast over television or
radio, or any seminar or meeting whose attendees have been invited by any
general solicitation or general advertising) in connection with the offering
of the Series A Notes.
(c) The Notes have not been and will not be registered
under the Act and may not be offered or sold within the United States or to,
or for the account or benefit of, U.S. persons except in accordance with
Regulation S under the Act or pursuant to an exemption from the registration
requirements of the Act. The Initial Purchasers represent that they have not
offered, sold or delivered the Notes, and will not offer, sell or deliver the
Notes (i) as part of its distribution at any time or (ii) otherwise until 40
days after the later of the commencement of the offering and the Closing Date
(such period, the "Restricted Period"), within the United States or to, or
for the account or benefit of U.S. persons, except in accordance with Rule
144A under the Act, or to Accredited Institutions in transactions that are
exempt from the registration requirements of the Act. Accordingly, each
Initial Purchaser represents and agrees that neither it, its affiliates nor
any persons acting on its or their behalf has engaged or will engage in any
directed selling efforts within the meaning of Rule 901(b) of Regulation S
with respect to the Notes, and it, its affiliates and all persons acting on
its behalf have complied and will comply with the offering restrictions
requirements of Regulation S.
(d) Such Initial Purchaser agrees that, at or prior to
confirmation of a sale of Notes (other than a sale pursuant to Rule 144A or
to Accredited Institutions in transactions that are exempt from the
registration requirements of the Act), it will have sent to each distributor,
dealer or person receiving a selling concession, fee or other remuneration
that purchases Notes from it during the Restricted Period a confirmation or
notice substantially to the following effect:
"The Notes covered hereby have not been registered under the
U.S. Securities Act of 1933 (the "Securities Act") and may
not be offered and sold within the United States or to, or
for the account or benefit of, U.S. persons (i) as part of
their distribution at any time or (ii) otherwise until 40
days after the later of the commencement of the offering or
the closing date, except in either case in accordance with
Regulation S (or Rule 144A if available) under the
Securities Act. Terms used above have the meanings assigned
to them in Regulation S."
Such Initial Purchaser further agrees that it has not
entered and will not enter into any contractual arrangement with respect to
the distribution or delivery of the Notes, except with its affiliates or with
the prior written consent of the Company.
(e) Such Initial Purchaser further represents and agrees
that (i) it has not offered or sold and will not offer or sell any Notes to
persons in the United Kingdom prior to the expiry of the period of six months
from the issue date of the Notes, except to persons whose ordinary activities
involve them in acquiring, holding, managing or disposing of investments (as
principal or agent) for the purposes of their businesses or otherwise in
circumstances which have not resulted and will not result in an offer to the
public in the United Kingdom within the meaning of the Public Offers of
Securities Regulations 1995, (ii) it has complied and will comply with all
applicable provisions of the Financial Services Xxx 0000 with respect to
anything done by it in relation to the Notes in, from or otherwise involving
the United Kingdom, and (iii) it has only issued or passed on and will only
issue or pass on in the United Kingdom any document received by it in
connection with the issuance of the Notes to a person who is of a kind
described in Article 11(3) of the Financial Services Xxx 0000 (Investment
Advertisements) (Exemptions) Order 1995 or is a person to whom the document
may otherwise lawfully be issued or passed on.
(f) Such Initial Purchase agrees not to cause any
advertisement of the Notes to be published in any newspaper or periodical or
posted in any public place and not to issue any circular relating to the
Notes, except such advertisements as include the statements required by
Regulation S.
(g) The sales of the Series A Notes pursuant to
Regulation S are "offshore transactions" and are not part of a plan or scheme
to evade the registration provisions of the Act.
(h) Such Initial Purchaser understands that the Company
and, for purposes of the opinions to be delivered to you pursuant to Section
7 hereof, counsel to the Company, General Counsel to the Company and counsel
to the Initial Purchasers, will rely upon the accuracy and truth of the
foregoing representations and you hereby consent to such reliance.
The terms used in this Section 2 that have meanings assigned
to them in Regulation S are used herein as so defined.
Each Initial Purchaser further agrees that, in connection
with the Exempt Resales, it will solicit offers to buy the Series A Notes
only from, and will offer to sell the Series A Notes only to, the Eligible
Purchasers in Exempt Resales.
3. Purchase of the Notes by the Initial Purchasers. On the
basis of the representations and warranties contained in, and subject to the
terms and conditions of, this Agreement, the Company agrees to sell $200.0
million in aggregate principal amount of Series A Notes to the several
Initial Purchasers and each of the Initial Purchasers, severally and not
jointly, agrees to purchase the aggregate principal amount of Series A Notes
set opposite that Initial Purchaser's name in Schedule 1 hereto. Each
Initial Purchaser will purchase such aggregate principal amount of Series A
Notes at an aggregate purchase price equal to 97.0% of the principal amount
thereof (the "Purchase Price").
The Company shall not be obligated to deliver any of the
Series A Notes to be delivered, except upon payment for all the Series A
Notes to be purchased on such Closing Date as provided herein.
4. Delivery of and Payment.
(a) Delivery to the Initial Purchasers of and payment
for the Series A Notes shall be made at 9:30 a.m., New York City time, on the
Closing Date at the offices of Xxxxxxx Xxxxxxx & Xxxxxxxx, 000 Xxxxxxxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, or such other time or place as you and the
Company shall designate.
(b) One or more Series A Notes in definitive form,
registered in the name of Cede & Co., as nominee of the Depository Trust
Company ("DTC"), or such other names as the Initial Purchasers may request
upon at least one business days' notice to the Company, having an aggregate
principal amount corresponding to the aggregate principal amount of Series A
Note sold pursuant to Eligible Resales to QIBs (collectively, the "Global
Note"), shall be delivered by the Company to the Initial Purchasers against
payment by the Initial Purchasers of the purchase price thereof by wire
transfer of immediately available funds as the Company may direct by written
notice delivered to you two business days prior to the Closing Date. The
Global Note in definitive form shall be made available to you for inspection
not later than 2:00 p.m. on the business day immediately preceding the
Closing Date.
(c) Time shall be of the essence, and delivery at the
time and place specified pursuant to this Agreement is a further condition of
the obligation of each Initial Purchaser hereunder.
5. Further Agreements of the Company. The Company agrees:
(a) To advise you promptly and, if requested by you, to
confirm such advice in writing, of (i) the issuance by any state securities
commission of any stop order suspending the qualification or exemption from
qualification of any Series A Notes for offering or sale in any jurisdiction,
or the initiation of any proceeding for such purpose by the Commission or any
state securities commission or other regulatory authority, and (ii) the
happening of any event that makes any statement of a material fact made in
the Preliminary Offering Memorandum or the Offering Memorandum untrue or
which requires the making of any additions to or changes in the Preliminary
Offering Memorandum or the Offering Memorandum in order to make the
statements therein, in light of the circumstances under which they were made,
not misleading. The Company shall use all commercially reasonable efforts to
prevent the issuance of any stop order or order suspending the qualification
or exemption of the Series A Notes under any state securities or Blue Sky
laws and, if at any time any state securities commission shall issue any stop
order suspending the qualification or exemption of the Series A Notes under
any state securities or Blue Sky laws, the Company shall use every reasonable
effort to obtain the withdrawal or lifting of such order at the earliest
possible time.
(b) To furnish to you, as many copies of the Preliminary
Offering Memorandum and the Offering Memorandum, and any amendments or
supplements thereto, as you may reasonably request. Such copies shall be
furnished without charge for the nine month period immediately following the
Closing Date. The Company consents to the use of the Preliminary Offering
Memorandum and the Offering Memorandum, and any amendments and supplements
thereto required pursuant to this Agreement, by you in connection with the
Exempt Resales that are in compliance with this Agreement.
(c) Not to amend or supplement the Offering Memorandum
prior to the Closing Date or during the period referred to in (d) below
unless you shall previously have been advised of, and shall not have
reasonably objected to, such amendment or supplement within a reasonable
time, but in any event not longer than five days after being furnished a copy
of such amendment or supplement. The Company shall promptly prepare, upon
any reasonable request by you, any amendment or supplement to the Offering
Memorandum that may be necessary or advisable in connection with Exempt
Resales.
(d) If, in connection with any Exempt Resales or market
making transactions after the date of this Agreement and prior to the
consummation of the Exchange Offer, any event shall occur that, in the
judgment of the Company or in the judgment of counsel to you, makes any
statement of a material fact in the Offering Memorandum untrue or that
requires the making of any additions to or changes in the Offering Memorandum
in order to make the statements in the Offering Memorandum, in light of the
circumstances at the time that the Offering Memorandum is delivered to
prospective Eligible Purchasers, not misleading, or if it is necessary to
amend or supplement the Offering Memorandum to comply with all applicable
laws, the Company shall promptly notify you of such event and prepare an
appropriate amendment or supplement to the Offering Memorandum so that (i)
the statements in the Offering Memorandum as amended or supplemented will, in
light of the circumstances at the time that the Offering Memorandum is
delivered to prospective Eligible Purchasers, not be misleading and (ii) the
Offering Memorandum will comply with applicable law.
(e) To cooperate with you and your counsel in connection
with the qualification of the Series A Notes for offer and sale by you and by
dealers under the state securities or Blue Sky laws of such jurisdictions as
you may request (provided, however, that the Company shall not be obligated
to qualify as a foreign corporation in any jurisdiction in which it is not
now so qualified or to take any action that would subject it to general
consent to service of process in any jurisdiction in which it is not now so
subject). The Company shall continue such qualification in effect so long as
required by law for distribution of the Series A Notes and shall file such
consents to service of process or other documents as may be necessary in
order to effect such qualification.
(f) Prior to the Closing Date, to furnish to you, as
soon as they have been prepared, a copy of any internal consolidated
financial statements of the Company for any period subsequent to the period
covered by the financial statements appearing in the Offering Memorandum.
(g) To use all commercially reasonable efforts to do and
perform all things required to be done and performed under this Agreement by
it prior to or after the Closing Date and to satisfy all conditions precedent
on its part to the delivery of the Series A Notes.
(h) Not to sell, offer for sale or solicit offers to buy
or otherwise negotiate in respect of any security (as defined in the Act)
that would be integrated with the sale of the Series A Notes in a manner that
would require the registration under the Act of the sale to you or the
Eligible Purchasers of Series A Notes.
(i) During any period in which the Company is not
subject to Section 13 or 15(d) of the Exchange Act within the two year period
following the Closing Date, to make available to any registered holder or
beneficial owner of Series A Notes in connection with any sale thereof and
any prospective purchaser of such Series A Notes from such registered holder
or beneficial owner, the information required by Rule 144A(d)(4) under the
Act.
(j) To use all commercially reasonable efforts to effect
the inclusion of the Notes in the National Association of Securities Dealers,
Inc. Automated Quotation System - PORTAL ("PORTAL").
(k) To apply the net proceeds from the sale of the Series A
Notes being sold by the Company as set forth in the Offering Memorandum under
the caption "Use of Proceeds."
(l) To take such steps as shall be necessary to ensure that
the Company shall not become an "investment company" within the meaning of
such term under the Investment Company Act of 1940 and the rules and
regulations of the Commission thereunder.
6. Expenses. The Company agrees that, whether or not the
transactions contemplated by this Agreement are consummated or this Agreement
becomes effective or is terminated, to pay all costs, expenses, fees and
taxes incident to and in connection with: (i) the preparation, printing and
distribution of the Preliminary Offering Memorandum and the Offering
Memorandum (including, without limitation, financial statements and exhibits)
and all amendments and supplements thereto (but not, however, legal fees and
expenses of your counsel incurred in connection therewith), (ii) the issuance
and delivery by the Company of the Notes, (iii) the qualification of the
Notes for offer and sale under the securities or Blue Sky laws of the several
states (including, without limitation, the reasonable fees and disbursements
of your counsel relating to such registration or qualification which will be
$10,000), (iv) furnishing such copies of the Preliminary Offering Memorandum
and the Offering Memorandum, and all amendments and supplements thereto, as
may be reasonably requested for use in connection with the Exempt Resales
during the nine month period following the Closing Date, (v) the preparation
of certificates for the Notes, (vi) the fees, disbursements and expenses of
the Company's counsel and accountants, (vii) all expenses and listing fees in
connection with the application for quotation of the Series A Notes in
PORTAL, (viii) all fees and expenses (including fees and expenses of counsel)
of the Company in connection with approval of the Notes by DTC for "book-
entry" transfer and (ix) the performance by the Company of their other
obligations under this Agreement.
7. Conditions of Initial Purchasers' Obligations. The
respective obligations of the Initial Purchasers hereunder are subject to the
accuracy, when made and again on the Closing Date (as if made again on and as
of such date), of the representations and warranties of the Company contained
herein, to the performance by the Company of its obligations hereunder, and
to each of the following additional terms and conditions:
(a) No Initial Purchaser shall have discovered and
disclosed to the Company on or prior to such Closing Date that the Offering
Memorandum or any amendment or supplement thereto contains an untrue
statement of a fact which, in the opinion of Xxxxxx & Xxxxxxx, counsel for
the Initial Purchasers, is material or omits to state a fact which, in the
opinion of such counsel, is material and is necessary to make the statements,
in the light of the circumstances under which they were made, not misleading.
(b) All corporate proceedings and other legal matters
incident to the authorization, form and validity of this Agreement, the other
Operative Documents, the Acquisition Documents, the Credit Documents, the
Offering Memorandum, and all other legal matters relating to this Agreement
and the transactions contemplated hereby shall be reasonably satisfactory in
all material respects to counsel for the Initial Purchasers.
(c) Xxxxxxx Xxxxxxx & Xxxxxxxx shall have furnished to
the Initial Purchasers, its written opinion, as counsel to the Company,
addressed to the Initial Purchasers and dated as of the Closing Date, in the
form of Exhibit C hereto:
(d) Fried, Frank, Harris, Xxxxxxx & Xxxxxxxx shall have
furnished to the Initial Purchasers, its written opinion, as counsel to the
Company, addressed to the Initial Purchasers and dated as of the Closing
Date, in form and substance reasonably satisfactory to the Initial Purchasers
and their counsel, to the effect that:
(i) None of the issuance, offer or sale of the
Series A Notes, the execution, delivery or performance by
the Company of this Agreement or the other Operative
Documents, compliance by the Company with the provisions
hereof or thereof nor consummation by the Company of the
transactions contemplated hereby or thereby; none of the
execution, delivery or performance by the Company of the
Credit Agreement or the other Credit Documents, compliance
by the Company with the provisions thereof nor consummation
by the Company of the transactions contemplated thereby; and
none of the execution, delivery or performance by the
Company of the Transaction Agreement or the other
Acquisition Documents, compliance by the Company with the
provisions thereof nor consummation by the Company of the
transactions contemplated thereby (i) requires any consent,
approval, authorization or other order of, or registration
or filing with, any court, regulatory body, administrative
agency or other governmental body, agency or official having
authority over government procurement matters (except for
those governmental authorizations identified in the
Transaction Agreement) or (ii) conflicts or will conflict
with or constitutes or will constitute a material breach of,
or a material default under any material government
procurement contract (limited to our review of the contracts
set forth on Exhibit A) or will violate any law, statute,
ordinance, governmental rule or regulation regarding U.S.
government procurement matters to which it or its property
or assets may be subject or will result in the creation or
imposition of any lien, charge or encumbrance upon any
property or assets of the Company pursuant to the terms of
any agreement or instrument (limited to our review of the
contracts set forth on Exhibit A) to which it is a party or
by which it may be bound or to which any of its property or
assets is subject pursuant to any government procurement
contract.
(ii) The statements under the caption "Risk
Factors -- Risks Inherent in Government Contracts" in the
Offering Memorandum, insofar as they are statements of law
or legal conclusions with respect to government procurement
contracts (which statements are identified on Exhibit B),
are accurate in all material respects and present fairly the
information shown.
The opinion of such counsel may be limited to the laws of
the state of New York, and the federal laws of the United States.
(e) Xxxxxxx X. XxXxxxx, Esq. shall have furnished to the
Initial Purchasers, his written opinion, as counsel to the Company, addressed
to the Initial Purchasers and dated as of the Closing Date, in form and
substance reasonably satisfactory to the Initial Purchasers and their
counsel, to the effect that:
(i) To the knowledge of such counsel, there are
no legal or governmental proceedings pending or, to the
knowledge of the Company, threatened, against the Company or
to which any of its properties, is subject, that are not
disclosed in the Offering Memorandum and which, if adversely
decided, are reasonably likely to cause a Material Adverse
Effect or to materially affect the issuance of the Notes or
the consummation of the other transactions contemplated by
the Operative Documents.
(f) The Initial Purchasers shall have received from Xxxxxx
& Xxxxxxx, counsel for the Initial Purchasers, such opinion or opinions,
dated such Closing Date, with respect to the issuance and sale of the Series
A Notes, the Offering Memorandum and other related matters as the Initial
Purchasers may reasonably require, and the Company shall have furnished to
such counsel such documents as they reasonably request for the purpose of
enabling them to pass upon such matters.
(g) The Initial Purchasers shall have received letters
addressed to the Initial Purchasers, and dated the date hereof and the
Closing Date from Coopers & Xxxxxxx L.L.P., independent certified public
accountants, substantially in the forms heretofore approved by the Initial
Purchasers.
(h) The Initial Purchasers shall have received letters
addressed to the Initial Purchasers, and dated the date hereof and the
Closing Date from Ernst & Young LLP, independent certified public
accountants, substantially in the forms heretofore approved by the Initial
Purchasers.
(i) The Company shall have furnished to the Initial
Purchasers a certificate, dated such Closing Date, of its Chairman of the
Board, its President or a Vice President and its chief financial officer
stating that:
(i) The representations, warranties and
agreements of the Company in Section 1 are true and correct
as of such Closing Date and giving effect to the
consummation of the transactions contemplated by the
Acquisition Documents, the Credit documents and this
Agreement; the Company has complied with all its agreements
contained herein; and the condition set forth in
Section 7(j) has been fulfilled; and
(ii) They have carefully examined the
Preliminary Offering Memorandum and the Offering Memorandum
and, in their opinion (A) the Offering Memorandum and the
Preliminary Offering Memorandum as of their respective dates
and the Offering Memorandum as of the Closing Date, did not
include any untrue statement of a material fact and did not
omit to state a material fact required to be stated therein
or necessary to make the statements therein not misleading,
and (B) since the date of the Offering Memorandum, no event
has occurred which should have been set forth in a
supplement or amendment to the Offering Memorandum.
(j) (i) The Company shall not have sustained since the
date of the latest audited financial statements included in the Offering
Memorandum any material loss or interference with its business from fire,
explosion, flood or other calamity, whether or not covered by insurance, or
from any labor dispute or court or governmental action, order or decree,
otherwise than as set forth or contemplated in the Offering Memorandum or
(ii) since such date there shall not have been any change in the capital
stock or long-term debt of the Company or any change, or any development
involving a prospective change, in or affecting the business, management,
financial position, shareholders' equity or results of operations of the
Company, otherwise than as set forth or contemplated in the Offering
Memorandum, the effect of which, in any such case described in clause (i) or
(ii), is, in the judgment of the Initial Purchasers, so material and adverse
as to make it impracticable or inadvisable to proceed with the public
offering or the delivery of the Notes being delivered on such Closing Date on
the terms and in the manner contemplated in the Offering Memorandum.
(k) Prior to or simultaneously with the closing of the
transactions contemplated by the Operative Documents, the Company shall have
closed the transactions contemplated by the Credit Documents and the
Acquisition Documents.
(l) Xxxxxx & Xxxxxxx shall have been furnished with
executed copies of the Acquisition Documents, the Credit Documents, the
stockholders agreements, dated the Closing Date, between and among the
Lockheed Xxxxxx Corporation, Xxxxxx Brothers Capital Partners III, L.P.,
Xxxxx X. Xxxxx, Xxxxxx X. XxXxxxx and L-3 Communications Holdings, Inc. and
the agreements and plans described in the Offering Memorandum under the
caption "Management -- Executive Compensation" and such other documents and
opinions, in addition to those set forth above, as they may reasonably
require for the purpose of enabling them to review or pass upon the matters
referred to in this Agreement and in order to evidence the accuracy,
completeness or satisfaction in all material respects of any of the
representations, warranties or conditions herein contained.
(m) Subsequent to the execution and delivery of this
Agreement (i) no downgrading shall have occurred in the rating accorded the
Company's debt securities by any "nationally recognized statistical rating
organization", as that term is defined by the Commission for purposes of Rule
436(g)(2) under the Act and (ii) no such organization shall have publicly
announced that it has under surveillance or review, with possible negative
implications, its rating of any of the Company's debt securities.
(n) Subsequent to the execution and delivery of this
Agreement there shall not have occurred any of the following: (i) trading in
securities generally on the New York Stock Exchange or the American Stock
Exchange or in the over-the-counter market, or trading in any securities of
the Company on any exchange or in the over-the-counter market, shall have
been suspended or minimum prices shall have been established on any such
exchange or such market by the Commission, by such exchange or by any other
regulatory body or governmental authority having jurisdiction, (ii) a banking
moratorium shall have been declared by Federal or state authorities, (iii)
the United States shall have become engaged in hostilities, there shall have
been an escalation in hostilities involving the United States or there shall
have been a declaration of a national emergency or war by the United States
or (iv) there shall have occurred such a material adverse change in general
economic, political or financial conditions (or the effect of international
conditions on the financial markets in the United States shall be such) as to
make it, in the judgment of the Initial Purchasers, impracticable or
inadvisable to proceed with the public offering or delivery of the Notes
being delivered on such Closing Date on the terms and in the manner
contemplated in the Offering Memorandum.
All opinions, letters, evidence and certificates mentioned
above or elsewhere in this Agreement shall be deemed to be in compliance with
the provisions hereof only if they are in form and substance reasonably
satisfactory to counsel for the Initial Purchasers.
8. Indemnification and Contribution.
(a) The Company shall indemnify and hold harmless each
Initial Purchaser, its officers and employees and each person, if any, who
controls any Initial Purchaser within the meaning of the Securities Act, from
and against any loss, claim, damage or liability, joint or several, or any
action in respect thereof (including, but not limited to, any loss, claim,
damage, liability or action relating to purchases and sales of Notes), to
which that Initial Purchaser, officer, employee or controlling person may
become subject, under the Securities Act or otherwise, insofar as such loss,
claim, damage, liability or action arises out of, or is based upon, (i) any
untrue statement or alleged untrue statement of a material fact contained (A)
in any Preliminary Offering Memorandum or the Offering Memorandum or in any
amendment or supplement thereto or (B) in any blue sky application or other
document prepared or executed by the Company (or based upon any written
information furnished by the Company) specifically for the purpose of
qualifying any or all of the Series A Notes under the securities laws of any
state or other jurisdiction (any such application, document or information
being hereinafter called a "Blue Sky Application"), (ii) the omission or
alleged omission to state in any Preliminary Offering Memorandum or the
Offering Memorandum, or in any amendment or supplement thereto, or in any
Blue Sky Application any material fact required to be stated therein or
necessary to make the statements therein not misleading or (iii) any act or
failure to act or any alleged act or failure to act by any Initial Purchaser
in connection with, or relating in any manner to, the Notes or the offering
contemplated hereby, and which is included as part of or referred to in any
loss, claim, damage, liability or action arising out of or based upon matters
covered by clause (i) or (ii) above (provided that the Company shall not be
liable under this clause (iii) to the extent that it is determined in a final
judgment by a court of competent jurisdiction that such loss, claim, damage,
liability or action resulted directly from any such acts or failures to act
undertaken or omitted to be taken by such Initial Purchaser through its gross
negligence or willful misconduct), and shall reimburse each Initial Purchaser
and each such officer, employee or controlling person promptly upon demand
for any legal or other expenses reasonably incurred by that Initial
Purchaser, officer, employee or controlling person in connection with
investigating or defending or preparing to defend against any such loss,
claim, damage, liability or action as such expenses are incurred; provided,
however, that the Company shall not be liable in any such case to the extent
that any such loss, claim, damage, liability or action arises out of, or is
based upon, any untrue statement or alleged untrue statement or omission or
alleged omission made in any Preliminary Offering Memorandum or the Offering
Memorandum, or in any such amendment or supplement, or in any Blue Sky
Application, in reliance upon and in conformity with written information
concerning such Initial Purchaser furnished to the Company by or on behalf of
any Initial Purchaser specifically for inclusion therein; provided further,
that the indemnification contained in this paragraph (a) with respect to the
Preliminary Offering Memorandum shall not inure to the benefit of any Initial
Purchaser (or to the benefit of any officers or employees of any Initial
Purchase or of any person controlling such Initial Purchaser) on account of
any such loss, claim, damage, liability or action arising from the sale of
the Series A Notes by such Initial Purchaser to any person if the untrue
statement or alleged untrue statement or omission or alleged omission of a
material fact contained in the Preliminary Offering Memorandum was corrected
in the Offering Memorandum and the Initial Purchaser sold Series A Notes to
that person without sending or giving at or prior to the written confirmation
of such sale, a copy of the Offering Memorandum (as then amended or
supplemented) if the Company has previously furnished sufficient copies
thereof to the Initial Purchaser on a timely basis to permit such sending or
giving. The foregoing indemnity agreement is in addition to any liability
which the Company may otherwise have to any Initial Purchaser or to any
officer, employee or controlling person of that Initial Purchaser.
(b) Each Initial Purchaser, severally and not jointly,
shall indemnify and hold harmless the Company, its officers and employees,
each of its directors, and each person, if any, who controls the Company
within the meaning of the Securities Act, from and against any loss, claim,
damage or liability, joint or several, or any action in respect thereof, to
which the Company or any such director, officer or controlling person may
become subject, under the Securities Act or otherwise, insofar as such loss,
claim, damage, liability or action arises out of, or is based upon, (i) any
untrue statement or alleged untrue statement of a material fact contained (A)
in any Preliminary Offering Memorandum or the Offering Memorandum or in any
amendment or supplement thereto, or (B) in any Blue Sky Application or (ii)
the omission or alleged omission to state in any Preliminary Offering
Memorandum or the Offering Memorandum, or in any amendment or supplement
thereto, or in any Blue Sky Application any material fact required to be
stated therein or necessary to make the statements therein not misleading,
but in each case only to the extent that the untrue statement or alleged
untrue statement or omission or alleged omission was made in reliance upon
and in conformity with written information concerning such Initial Purchaser
furnished to the Company by or on behalf of that Initial Purchaser
specifically for inclusion therein, and shall reimburse the Company and any
such director, officer or controlling person for any legal or other expenses
reasonably incurred by the Company or any such director, officer or
controlling person in connection with investigating or defending or preparing
to defend against any such loss, claim, damage, liability or action as such
expenses are incurred. The foregoing indemnity agreement is in addition to
any liability which any Initial Purchaser may otherwise have to the Company
or any such director, officer, employee or controlling person.
(c) Promptly after receipt by an indemnified party under
this Section 8 of notice of any claim or the commencement of any action, the
indemnified party shall, 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 claim or the commencement of that action; provided, however,
that the failure to notify the indemnifying party shall not relieve it from
any liability which it may have under this Section 8 except to the extent it
has been materially prejudiced by such failure and, provided further, that
the failure to notify the indemnifying party shall not relieve it from any
liability which it may have to an indemnified party otherwise than under this
Section 8. If any such claim or action shall be brought against an
indemnified party, and it shall notify the indemnifying party thereof, the
indemnifying party shall be entitled to participate therein and, to the
extent that it wishes, jointly with any other similarly notified indemnifying
party, to assume the defense thereof with counsel reasonably satisfactory to
the indemnified party. After notice from the indemnifying party to the
indemnified party of its election to assume the defense of such claim or
action, the indemnifying party shall not be liable to the indemnified party
under this Section 8 for any legal or other expenses subsequently incurred by
the indemnified party in connection with the defense thereof other than
reasonable costs of investigation; provided, however, any indemnified party
shall have the right to employ separate counsel in any such action and to
participate in the defense thereof but the fees and expenses of such counsel
shall be at the expense of such indemnified party unless (i) the employment
thereof has been specifically authorized by the indemnifying party in
writing, (ii) such indemnified party shall have been advised by such counsel
that there may be one or more legal defenses available to it which are
different from or additional to those available to the indemnifying party and
in the reasonable judgement of such counsel it is advisable for such
indemnified party to employ separate counsel or (iii) the indemnifying party
has failed to assume the defense of such action and employ counsel reasonably
satisfactory to the indemnified party, in which case, if such indemnified
party notifies the indemnifying party in writing that it elects to employ
separate counsel at the expense of the indemnifying party shall not, in
connection with any one such action or separate but substantially similar or
related actions in the same jurisdiction arising out of the same general
allegations or circumstances, be liable for the reasonable fees and expenses
of more than one separate firm of attorneys (in addition to one local
counsel) at any time for all such indemnified parties, which firm shall be
designated in writing by Xxxxxx Brothers Inc., if the indemnified parties
under this Section 8 consist of any Initial Purchaser or any of their
respective officers, employees or controlling persons, or by the Company, if
the indemnified parties under this Section consist of the Company or any of
the Company's directors, officers, employees or controlling persons. Each
indemnified party, as a condition of the indemnity agreements contained in
Section 8, shall use all commercially reasonable efforts to cooperate with
the indemnifying party in the defense of any such action or claim. No
indemnifying party shall (i) without the prior written consent of the
indemnified parties (which consent shall not be unreasonably withheld),
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 includes an
unconditional release of each indemnified party from all liability arising
out of such claim, action, suit or proceeding, or (ii) be liable for any
settlement of any such action effected without its written consent (which
consent shall not be unreasonably withheld), but if settled with the consent
of the indemnifying party or if there be a final judgment of the plaintiff in
any such action, the indemnifying party agrees to indemnify and hold harmless
any indemnified party from and against any loss or liability by reason of
such settlement or judgment.
(d) If the indemnification provided for in this Section
8 shall for any reason be unavailable to or insufficient to hold harmless an
indemnified party under Section 8(a) in respect of any loss, claim, damage or
liability, or any action in respect thereof, referred to therein, then each
indemnifying party shall, in lieu of indemnifying such indemnified party,
contribute to the amount paid or payable by such indemnified party as a
result of such loss, claim, damage or liability, or action in respect
thereof, (i) in such proportion as shall be appropriate to reflect the
relative benefits received by the Company on the one hand and the Initial
Purchasers on the other from the offering of the Series A Notes or (ii) if
the allocation provided by clause (i) above is not permitted by applicable
law, in such proportion as is appropriate to reflect not only the relative
benefits referred to in clause (i) above but also the relative fault of the
Company on the one hand and the Initial Purchasers on the other with respect
to the statements or omissions which resulted in such loss, claim, damage or
liability, or action in respect thereof, as well as any other relevant
equitable considerations. The relative benefits received by the Company on
the one hand and the Initial Purchasers on the other with respect to such
offering shall be deemed to be in the same proportion as the total net
proceeds from the offering of the Series A Notes purchased under this
Agreement (before deducting expenses) received by the Company, on the one
hand, and the total discounts and commissions received by the Initial
Purchasers with respect to the Series A Notes purchased under this Agreement,
on the other hand, bear to the total gross proceeds from the offering of the
Series A Notes under this Agreement, in each case as set forth in the table
on the cover page of the Offering Memorandum. The relative fault shall be
determined by reference to whether the untrue or alleged untrue statement of
a material fact or omission or alleged omission to state a material fact
relates to information supplied by the Company or the Initial Purchasers, the
intent of the parties and their relative knowledge, access to information and
opportunity to correct or prevent such statement or omission. The Company
and the Initial Purchasers agree that it would not be just and equitable if
contributions pursuant to this Section 8(d) were to be determined by pro rata
allocation (even if the Initial Purchasers were treated as one entity for
such purpose) or by any other method of allocation which does not take into
account the equitable considerations referred to herein. The amount paid or
payable by an indemnified party as a result of the loss, claim, damage or
liability, or action in respect thereof, referred to above in this Section
shall be deemed to include, for purposes of this Section 8(d), any legal or
other expenses reasonably incurred by such indemnified party in connection
with investigating or defending any such action or claim. Notwithstanding
the provisions of this Section 8(d), no Initial Purchaser shall be required
to contribute any amount in excess of the amount by which the total price at
which the Series A Notes purchased by it was resold to Eligible Purchasers
exceeds the amount of any damages which such Initial Purchaser has otherwise
paid or become liable to pay by reason of any untrue or alleged untrue
statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The Initial Purchasers' obligations to
contribute as provided in this Section 8(d) are several in proportion to
their respective underwriting obligations and not joint.
(e) The Initial Purchasers severally confirm and the
Company acknowledges that the last paragraph on the cover page, the
stabilization legend on page iii and the last two paragraphs under the
caption "Plan of Distribution" constitute the only information concerning
such Initial Purchasers furnished in writing to the Company by or on behalf
of the Initial Purchasers specifically for inclusion in the Offering
Memorandum.
9. Termination. The obligations of the Initial
Purchasers hereunder may be terminated by Xxxxxx Brothers Inc. by notice
given to the Company prior to delivery of and payment for the Series A Notes
if, prior to that time, any of the events described in Sections 7(j), 7(m) or
7(n), shall have occurred or if the Initial Purchasers shall decline to
purchase the Series A Notes for any reason permitted under this Agreement.
10. Reimbursement of Initial Purchasers' Expenses. If
the Company shall fail to tender the Series A Notes for delivery to the
Initial Purchasers by reason of any failure, refusal or inability on the part
of the Company to perform any agreement on its part to be performed, or
because any other condition of the Initial Purchasers' obligations hereunder
required to be fulfilled by the Company is not fulfilled, the Company will
reimburse the Initial Purchasers for all reasonable out-of-pocket expenses
(including the fees and disbursements of its counsel) incurred by the Initial
Purchasers in connection with this Agreement and the proposed purchase of the
Series A Notes, and upon demand the Company shall pay the full amount thereof
to Xxxxxx Brothers Inc.
11. Notices, etc. All statements, requests, notices and
agreements hereunder shall be in writing, and:
(a) if to the Initial Purchasers, shall be delivered
or sent by mail, telex or facsimile transmission to Xxxxxx
Brothers Inc., Three World Financial Center, New York, New
York 10285, Attention: Syndicate Department (Fax: 212-526-
6588), with a copy to Xxxxxx & Xxxxxxx, 000 Xxxxx Xxxxxx,
Xxx Xxxx, Xxx Xxxx 00000, Attention: Xxxx X. Xxxxxxxxx (Fax:
212-751-4864) and, in the case of any notice pursuant to
Section 8, to the Director of Litigation, Office of the
General Counsel, Xxxxxx Brothers Inc., Three World Xxxxxxxxx
Xxxxxx, 00xx Xxxxx, Xxx Xxxx, XX 00000; and
(b) if to the Company, shall be delivered or sent by
mail, telex or facsimile transmission to L-3 Communications
Corporation, 000 Xxxxx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx
Xxxx 00000, Attention: Chief Financial Officer (Fax: 212-
805-5470), with a copy to Xxxxxxx Xxxxxxx & Xxxxxxxx, 000
Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention:
Xxxxxx X. Xxxxxx (Fax: (000) 000-0000).
Any such statements, requests, notices or agreements shall
take effect at the time of receipt thereof. The Company shall be entitled to
act and rely upon any request, consent, notice or agreement given or made on
behalf of the Initial Purchasers by Xxxxxx Brothers Inc.
12. Persons Entitled to Benefit of Agreement. This
Agreement shall inure to the benefit of and be binding upon the Initial
Purchasers, the Company, and their respective personal representatives and
successors. This Agreement and the terms and provisions hereof are for the
sole benefit of only those persons, except that (i) the representations,
warranties, indemnities and agreements of the Company contained in this
Agreement shall also be deemed to be for the benefit of the person or
persons, if any, who control any Initial Purchaser within the meaning of
Section 15 of the Securities Act.
13. Survival. The respective indemnities, representations,
warranties and agreements of the Company and the Initial Purchasers contained
in this Agreement or made by or on behalf on them, respectively, pursuant to
this Agreement, shall survive the delivery of and payment for the Notes and
shall remain in full force and effect, regardless of any investigation made
by or on behalf of any of them or any person controlling any of them.
14. Definition of the Terms "Business Day" and
"Subsidiary." For purposes of this Agreement, (a) "business day" means any
day on which the New York Stock Exchange, Inc. is open for trading and (b)
"subsidiary" has the meaning set forth in Rule 405 of the Rules and
Regulations.
15. Governing Law. This Agreement shall be governed by
and construed in accordance with the laws of New York.
16. Counterparts. This Agreement may be executed in one
or more counterparts and, if executed in more than one counterpart, the
executed counterparts shall each be deemed to be an original but all such
counterparts shall together constitute one and the same instrument.
17. Headings. The headings herein are inserted for
convenience of reference only and are not intended to be part of, or to
affect the meaning or interpretation of, this Agreement.
[signature pages follow]
If the foregoing correctly sets forth the agreement between
the Company and the Initial Purchasers, please indicate your acceptance in
the space provided for that purpose below.
Very truly yours,
L-3 Communications Corporation
By ________________________________
Name:
Title:
Accepted:
Xxxxxx Brothers Inc.
BancAmerica Securities, Inc.
By Xxxxxx Brothers Inc.
By ______________________________________
Authorized Representative
If the foregoing correctly sets forth the agreement between
the Company and the Initial Purchasers, please indicate your acceptance in
the space provided for that purpose below.
Very truly yours,
L-3 Communications Corporation
By ________________________________
Name:
Title:
Accepted:
Xxxxxx Brothers Inc.
BancAmerica Securities, Inc.
By Xxxxxx Brothers Inc.
By ______________________________________
Authorized Representative
SCHEDULE 1
Initial Purchaser Principal Amount of
Notes
Xxxxxx Brothers Inc. . . . . . . . . . . . . . . $202,500,000
BancAmerica Securities, Inc . . . . . . . . . . . 22,500,000
Total $225,000,000
