================================================================================
RAYTHEON COMPANY
GUARANTEE AGREEMENT
RC TRUST I
----------------------------
Dated as of May 9, 2001
================================================================================
TABLE OF CONTENTS
Page
----
ARTICLE I
DEFINITIONS
Section 1.01 Definitions..................................................1
ARTICLE II
TRUST INDENTURE ACT
Section 2.01 Trust Indenture Act; Application.............................5
Section 2.02 Lists of Holders of Preferred Securities.....................5
Section 2.03 Reports by the Guarantee Trustee.............................5
Section 2.04 Periodic Reports to the Guarantee Trustee....................6
Section 2.05 Evidence of Compliance with Conditions Precedent.............6
Section 2.06 Events of Default; Waiver....................................6
Section 2.07 Disclosure of Information....................................6
Section 2.08 Conflicting Interest.........................................7
ARTICLE III
POWERS, DUTIES AND RIGHTS OF THE GUARANTEE TRUSTEE
Section 3.01 Powers and Duties of the Guarantee Trustee...................7
Section 3.02 Certain Rights and Duties of the Guarantee Trustee...........8
Section 3.03 Not Responsible for Recitals or Issuance of
Guarantee...................................................10
Section 3.04 The Guarantee Trustee May Own Preferred Securities..........10
Section 3.05 Moneys Received by the Guarantee Trustee to Be
Held in Trust Without Interest..............................10
Section 3.06 Compensation and Expenses of Guarantee Trustee..............10
ARTICLE IV
GUARANTEE TRUSTEE
Section 4.01 Qualifications..............................................11
Section 4.02 Appointment, Removal and Resignation of the
Guarantee Trustee...........................................12
ARTICLE V
GUARANTEE
Section 5.01 Guarantee...................................................12
Section 5.02 Waiver of Notice............................................13
Section 5.03 Obligations Not Affected....................................13
Section 5.04 Enforcement of Guarantee....................................14
Section 5.05 Guarantee of Payment........................................14
-i-
Section 5.06 Subrogation.................................................14
Section 5.07 Independent Obligations.....................................14
ARTICLE VI
LIMITATION OF TRANSACTIONS; SUBORDINATION
Section 6.01 Limitation of Transactions..................................16
Section 6.02 Subordination...............................................16
Section 6.03 Ranking.....................................................17
ARTICLE VII
TERMINATION
Section 7.01 Termination.................................................17
ARTICLE VIII
LIMITATION OF LIABILITY; INDEMNIFICATION
Section 8.01 Exculpation.................................................17
Section 8.02 Indemnification.............................................18
Section 8.03 Survive Termination.........................................18
ARTICLE IX
MISCELLANEOUS
Section 9.01 Successors and Assigns......................................18
Section 9.02 Amendments..................................................18
Section 9.03 Notices.....................................................19
Section 9.04 Genders.....................................................19
Section 9.05 Benefit.....................................................19
Section 9.06 Governing Law...............................................19
Section 9.07 Counterparts................................................20
Section 9.09 Limited Liability...........................................20
-ii-
GUARANTEE AGREEMENT
This GUARANTEE AGREEMENT, dated as of May 9, 2001, is executed and
delivered by RAYTHEON COMPANY, a Delaware corporation (the "Guarantor"), and The
Bank of New York, a New York corporation, as the initial Guarantee Trustee (as
defined herein) for the benefit of the Holders (as defined herein) from time to
time of the Securities (as defined herein) of RC Trust I, a Delaware statutory
business trust (the "Issuer").
WHEREAS, pursuant to an Amended and Restated Declaration of Trust
(the "Declaration"), dated as of May 9, 2001 among the trustees of the Issuer
named therein, Raytheon Company, as Sponsor, and the Holders from time to time
of preferred and common undivided beneficial interests in the assets of the
Issuer, the Issuer may issue up to $862,500,000 aggregate liquidation amount of
its Preferred Securities (the "Preferred Securities") representing preferred
undivided beneficial interests in the assets of the Issuer and having the terms
set forth in the Declaration and $26,675,300 in aggregate liquidation amount of
its Common Securities, all of which are being issued as of the date hereof; and
WHEREAS, as incentive for the Holders to purchase Securities, the
Guarantor desires to irrevocably and unconditionally agree, to the extent set
forth herein, to pay to the Holders the Guarantee Payments (as defined herein)
and to make certain other payments on the terms and conditions set forth herein;
NOW, THEREFORE, in consideration of the purchase by the initial
purchasers thereof of Securities, which purchase the Guarantor hereby agrees
shall benefit the Guarantor, the Guarantor executes and delivers this Guarantee
Agreement for the benefit of the Holders from time to time.
ARTICLE I
DEFINITIONS
Section 1.01 Definitions.
------------
(a) Capitalized terms used in this Guarantee Agreement but not defined
in the preamble or recitals above have the respective meanings assigned to them
in this Section 1.01.
(b) A term defined anywhere in this Guarantee Agreement has the same
meaning throughout.
(c) All references to "the Guarantee Agreement" or "this Guarantee
Agreement" are to this Guarantee Agreement as modified, supplemented or amended
from time to time.
(d) All references in this Guarantee Agreement to Articles and Sections
are to Articles and Sections of this Guarantee Agreement unless otherwise
specified.
(e) A term defined in the Trust Indenture Act has the same meaning when
used in this Guarantee Agreement unless otherwise defined in this Guarantee
Agreement or unless the context otherwise requires.
(f) A reference to the singular includes the plural and vice versa.
"Affiliate" of any specified Person means any other Person directly
or indirectly controlling or controlled by, or under direct or indirect common
control with, such specified Person. For purposes of this definition, "control"
of a Person shall mean the power to direct the management and policies of such
Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise, and the terms "controlling" and
"controlled" shall have meanings correlative to the foregoing.
"Business Day" means any day that is not a Saturday, Sunday or day
on which banking institutions and trust companies in the City of New York, the
Commonwealth of Massachusetts or at a place of payment are authorized or
required by law, regulation or executive order to close.
"Commission" means the United States Securities and Exchange
Commission.
"Common Security" shall have the meaning set forth in the
Declaration.
"Common Stock" means the Class B common stock, par value $.01 per
share, of the Company as such class may be reclassified, with the Class A common
stock, par value $.01 per share, of the Company into one new class of common
stock of the Company as set forth in the prospectus contained in the Company's
Registration Statement on Form S-3 filed April 6, 2001 under "Description of Our
Class A and Class B Common Stock - Reverse/Forward Stock Split" and
"--Reclassification of our Existing Two Classes of Common Stock into a Single
New Class of Common Stock."
"Declaration" has the meaning set forth in the recitals above.
"Distributions" means the periodic distributions and other payments
payable to Holders in accordance with the terms of the Securities (as defined in
the Declaration).
"Dollar" has the meaning set forth in the Indenture.
"Extension Period" has the meaning set forth in the Indenture.
"Guarantee Event of Default" means a default by the Guarantor on any
of its payment or other obligations under this Guarantee Agreement; provided,
however, that, except with respect to a default in payment of any Guarantee
Payment, any such default shall constitute a Guarantee Event of Default only if
the Guarantor shall have received notice of such default and shall not have
cured such default within 60 days after receipt of such notice.
"Guarantee Payments" means the following payments or distributions,
without duplication, with respect to the Securities, to the extent not paid or
made by or on behalf of the Issuer: (i) any accumulated and unpaid Distributions
and the Redemption Price, including all
-2-
accumulated and unpaid Distributions to the date of redemption, with respect to
the Securities called for redemption by the Issuer but only if and to the extent
that in each case the Guarantor has made a payment to the Property Trustee of
principal of, any premium or interest on the Notes and the amount so paid has
not been distributed to the Holders and (ii) upon a voluntary or involuntary
winding up, dissolution or termination of the Issuer (other than in connection
with the distribution of Notes to Holders in exchange for Securities or the
redemption of the Securities in full upon the maturity or redemption of the
Notes as provided in theNotes), the lesser of (a)the aggregate of the
liquidation amount and all accumulated and unpaid Distributions on the
Securities to the date of payment, to the extent the Issuer has funds on hand
legally available therefor, and (b) the amount of assets of the Issuer remaining
available for distribution to Holders in liquidation of the Issuer as required
by applicable law.
"Guarantee Trustee" means The Bank of New York, a New York banking
corporation, in its capacity as guarantee trustee hereunder, until, if
necessary, a Successor Guarantee Trustee has been appointed and has accepted
such appointment pursuant to the terms of this Guarantee Agreement, and
thereafter means each such Successor Guarantee Trustee, in its capacity as
guarantee trustee hereunder.
"Holder" means any holder, as registered on the books and records of
the Issuer, of any Preferred Securities or Common Securities; provided, however,
that in determining whether the holders of the requisite percentage of
Securities have given any request, notice, consent or waiver hereunder, "Holder"
shall not include the Guarantor or any Affiliate of the Guarantor.
"Indemnified Person" means the Guarantee Trustee, any Affiliate of
the Guarantee Trustee, and any officers, directors, shareholders, members,
partners, employees, representatives or agents of the Guarantee Trustee.
"Indenture" means the Indenture dated as of July 3, 1995 between
Raytheon Company and The Bank of New York, as trustee, as supplemented by the
Supplemental Indenture thereto dated as of May 9, 2001 (the "Supplemental
Indenture"), pursuant to which the Notes are to be issued to the Trust.
"Majority of Outstanding Securities" means Holder(s) of outstanding
Securities, voting together as a single class, who are the record owners of
Securities representing a majority of the outstanding Securities.
"Notes" means the series of unsecured 7.00% Subordinated Notes due
May 15, 2006 issued to the Trust by Raytheon Company under the Indenture and
entitled the "7.00% Subordinated Notes due 2006."
"Officers' Certificate" means, with respect to any Person, a
certificate signed by the Chairman of the Board, the President, any Vice
Chairman of the Board, any Vice President, the chief financial officer, the
Treasurer, any Assistant Treasurer, the Controller, the Secretary or any
Assistant Secretary of such Person, and delivered to the Guarantee Trustee. One
of the officers signing an Officers' Certificate given pursuant to Section 2.04
shall be the principal executive, financial or accounting officer of the
Guarantor. Any Officers' Certificate delivered with
-3-
respect to compliance with a condition or covenant provided for in this
Guarantee Agreement shall include:
(i) a statement that the person making such certificate has
read such covenant or condition;
(ii) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions
contained in such certificate are based;
(iii) a statement that, in the opinion of such person, he has
made such examination or investigation as is necessary to enable him to
express an informed opinion as to whether or not such covenant or
condition has been complied with; and
(iv) a statement as to whether or not, in the opinion of such
person, such condition or covenant has been complied with.
"Person" means a legal person, including any individual,
corporation, estate, partnership, limited liability company, joint venture,
incorporated or unincorporated association, joint stock company, trust,
unincorporated organization or government or other agency or political
subdivision thereof or other entity of any kind.
"Preferred Securities" has the meaning set forth in the recitals
above.
"Property Trustee" means The Bank of New York, as property trustee
under the Declaration, or any successor thereto that is a financial institution
unaffiliated with the Company.
"Prospectus" means the final Prospectus Supplement dated May 3, 2001
of the Company relating the Units and the Trust, supplementing the Prospectus
dated April 6, 2001 of the Company and the Trust.
"Redemption Price" means the amount payable on redemption of the
Preferred Securities in accordance with the terms of the Securities.
"Responsible Officer" means, when used with respect to the Guarantee
Trustee, any officer within the corporate trust department of the Guarantee
Trustee, including any vice president, assistant vice president, assistant
secretary, assistant treasurer, trust officer or any other officer of the
Guarantee Trustee who customarily performs functions similar to those performed
by the Persons who at the time shall be such officers, respectively, or to whom
any corporate trust matter is referred because of such Person's knowledge of and
familiarity with the particular subject and, in either case, who shall have
direct responsibility for the administration of this Guarantee Agreement.
"Securities" means Preferred Securities and Common Securities.
"Successor Guarantee Trustee" means a successor Guarantee Trustee
possessing the qualifications to act as a Guarantee Trustee under Section 4.01.
-4-
"Supplemental Indenture" has the meaning specified in the definition
of Indenture.
"Trust Indenture Act" means the Trust Indenture Act of 1939, as
amended from time to time, or any successor legislation.
"Trust Enforcement Event" shall have the meaning given such term in
the Declaration.
ARTICLE II
TRUST INDENTURE ACT
Section 2.01 Trust Indenture Act; Application.
---------------------------------
(a) This Guarantee Agreement is subject to the provisions of the Trust
Indenture Act that are required to be part of this Guarantee Agreement and
shall, to the extent applicable, be governed by such provisions.
(b) If and to the extent that any provision of this Guarantee Agreement
limits, qualifies or conflicts with the duties imposed by Sections 310 to 317,
inclusive, of the Trust Indenture Act, such imposed duties shall control.
(c) The application of the Trust Indenture Act to this Guarantee
Agreement shall not affect the nature of the Securities as equity securities
representing undivided beneficial interests in the assets of the Issuer.
Section 2.02 Lists of Holders of Securities.
-------------------------------
(a) The Guarantor shall provide the Guarantee Trustee (unless the
Guarantee Trustee is the registrar of the Securities) (i) within 14 days after
each record date for payment of Distributions, a list, in such form as the
Guarantee Trustee may reasonably require, of the names and addresses of the
Holders ("List of Holders") as of such date, and (ii) at any other time, within
30 days of receipt by the Guarantor of a written request for a List of Holders
as of a date no more than 15 days before such List of Holders is given to the
Guarantee Trustee; provided that in each case the Guarantor shall not be
obligated to provide such List of Holders at any time that the List of Holders
does not differ from the most recent List of Holders given to the Guarantee
Trustee by the Guarantor. The Guarantee Trustee shall preserve, in as current a
form as is reasonably practicable, all information contained in the Lists of
Holders given to it; provided that the Guarantee Trustee may destroy any List of
Holders previously given to it on receipt of a new List of Holders.
(b) The Guarantee Trustee shall comply with its obligations under
Section 312(b) of the Trust Indenture Act.
Section 2.03 Reports by the Guarantee Trustee.
---------------------------------
Within 60 days after May 1st of each year, commencing May 1st, 2002,
the Guarantee Trustee shall deliver to the Holders such reports as are required
by Section 313 of the Trust Indenture Act, if any, in the form, in the manner
and at the times provided by Section 313 of the Trust
-5-
Indenture Act. The Guarantee Trustee shall also comply with the other
requirements of Section 313 of the Trust Indenture Act. A copy of each such
report shall, at the time of such transmission to the Holders, be filed by the
Guarantee Trustee with the Guarantor, with each stock exchange or quotation
system upon which any Securities are listed or traded (if so listed or traded)
and also with the Commission. The Guarantor agrees to notify the Guarantee
Trustee when any Securities become listed on any stock exchange or quotation
system and of any delisting thereof.
Section 2.04 Periodic Reports to the Guarantee Trustee.
------------------------------------------
The Guarantor shall provide to the Guarantee Trustee, the Commission
and the Holders, as applicable, such documents, reports and information (if any)
as required by Section 314(a)(1)-(3) of the Trust Indenture Act and the
compliance certificates required by Section 314(a)(4) and (c) of the Trust
Indenture Act, any such certificates to be provided in the form, in the manner
and at the times required by Section 314(a)(4) and (c) of the Trust Indenture
Act (provided that any certificate to be provided pursuant to Section 314(a)(4)
of the Trust Indenture Act shall be provided within 120 days of the end of each
fiscal year of the Issuer). Delivery of such reports, information and documents
to the Guarantee Trustee is for informational purposes only and the Guarantee
Trustee's receipt of such shall not constitute constructive notice of any
information contained therein, including the Guarantor's compliance with any of
its covenants hereunder (as to which the Guarantee Trustee is entitled to rely
exclusively on Officers' Certificates or on certificates provided pursuant to
this Section 2.04).
Section 2.05 Evidence of Compliance with Conditions Precedent.
-------------------------------------------------
The Guarantor shall provide to the Guarantee Trustee such evidence
of compliance with any conditions precedent, if any, provided for in this
Guarantee Agreement which relate to any of the matters set forth in Section
314(c) of the Trust Indenture Act. Any certificate or opinion required to be
given by an officer pursuant to Section 314(c) may be given in the form of an
Officers' Certificate.
Section 2.06 Events of Default; Waiver.
--------------------------
(a) The Holders of a Majority of Outstanding Securities may, by vote,
on behalf of the Holders, waive any past Guarantee Event of Default and its
consequences. Upon such waiver, any such Guarantee Event of Default shall cease
to exist, and any Guarantee Event of Default arising therefrom shall be deemed
to have been cured, for every purpose of this Guarantee Agreement, but no such
waiver shall extend to any subsequent or other default or Guarantee Event of
Default, or impair any right consequent thereon.
(b) The right of any Holder to receive payment of the Guarantee Payments
in accordance with this Guarantee Agreement, or to institute suit for the
enforcement of any such payment, shall not be impaired without the consent of
each such Holder.
Section 2.07 Disclosure of Information.
--------------------------
The disclosure of information as to the names and addresses of the
Holders in ac-
-6-
cordance with Section 312 of the Trust Indenture Act, regardless of
the source from which such information was derived, shall not be deemed to be a
violation of any existing law, or any law hereafter enacted which does not
specifically refer to Section 312 of the Trust Indenture Act, nor shall the
Guarantee Trustee be held accountable by reason of mailing any material pursuant
to a request made under Section 312(b) of the Trust Indenture Act.
Section 2.08 Conflicting Interest.
---------------------
(a) The Declaration shall be deemed to be specifically described in this
Guarantee Agreement for the purposes of clause (i) of the first proviso
contained in Section 310(b) of the Trust Indenture Act.
(b) The Guarantee Trustee shall comply with its obligations under
Sections 310(b) and 311 of the Trust Indenture Act.
ARTICLE III
POWERS, DUTIES AND RIGHTS
OF THE GUARANTEE TRUSTEE
Section 3.01 Powers and Duties of the Guarantee Trustee.
-------------------------------------------
(a) This Guarantee Agreement shall be held by the Guarantee Trustee in
trust for the benefit of the Holders. The Guarantee Trustee shall not transfer
its right, title and interest in this Guarantee Agreement to any Person except a
Successor Guarantee Trustee on acceptance by such Successor Guarantee Trustee of
its appointment to act as Guarantee Trustee or to a Holder exercising his or her
rights pursuant to Section 5.04(iv). The right, title and interest of the
Guarantee Trustee to this Guarantee Agreement shall vest automatically in each
Person who may hereafter be appointed as Guarantee Trustee in accordance with
Article IV. Such vesting and cessation of title shall be effective whether or
not conveyancing documents have been executed and delivered.
(b) If a Guarantee Event of Default has occurred and is continuing, the
Guarantee Trustee shall enforce this Guarantee Agreement for the benefit of the
Holders.
(c) This Guarantee Agreement and all moneys received by the Guarantee
Trustee in respect of the Guarantee Payments will not be subject to any right,
charge, security interest, lien or claim of any kind in favor of, or for the
benefit of, the Guarantee Trustee or its agents or their creditors.
(d) The Guarantee Trustee shall, within 90 days after the occurrence of
a Guarantee Event of Default actually known to a Responsible Officer of the
Guarantee Trustee, transmit by mail, first class postage prepaid, to the
Holders, as their names and addresses appear upon the List of Holders, notice of
all such Events of Default, unless such defaults shall have been cured before
the giving of such notice; provided that the Guarantee Trustee shall be
protected in withholding such notice if and so long as the board of directors,
the executive committee or a trust committee of directors and/or Responsible
Officers of the Guarantee Trustee in good faith determines that the withholding
of such notice is in the interests of the Holders. The
-7-
Guarantee Trustee shall not be deemed to have knowledge of any Guarantee Event
of Default except any Guarantee Event of Default as to which the Guarantee
Trustee shall have received written notice or a Responsible Officer charged with
the administration of this Guarantee Agreement shall have obtained written
notice of such Guarantee Event of Default.
(e) The Guarantee Trustee shall continue to serve as a trustee until a
Successor Guarantee Trustee has been appointed and accepted that appointment in
accordance with Article IV.
Section 3.02 Certain Rights and Duties of the Guarantee Trustee.
---------------------------------------------------
(a) The Guarantee Trustee, before the occurrence of a Guarantee Event of
Default and after the curing or waiving of all Events of Default that may have
occurred, shall undertake to perform only such duties as are specifically set
forth in this Guarantee Agreement, and no implied covenants shall be read into
this Guarantee Agreement against the Guarantee Trustee. In case a Guarantee
Event of Default has occurred (that has not been cured or waived pursuant to
Section 2.06), the Guarantee Trustee shall exercise such of the rights and
powers vested in it by this Guarantee Agreement, and use the same degree of care
and skill in its exercise thereof, as a prudent person would exercise or use
under the circumstances in the conduct of his own affairs.
(b) No provision of this Guarantee Agreement shall be construed to
relieve the Guarantee Trustee from liability for its own negligent action, its
own negligent failure to act or its own willful misconduct, except that:
(i) prior to the occurrence of a Guarantee Event of Default and
after the curing or waiving of all such Events of Default that may
have occurred:
(A) the duties and obligations of the Guarantee Trustee
shall be determined solely by the express provisions of this
Guarantee Agreement, and the Guarantee Trustee shall not be
liable except for the performance of such duties and
obligations as are specifically set forth in this Guarantee
Agreement, and no implied covenants or obligations shall be
read into this Guarantee Agreement against the Guarantee
Trustee; and
(B) in the absence of bad faith on the part of the
Guarantee Trustee, the Guarantee Trustee may conclusively
rely, as to the truth of the statements and the correctness of
the opinions expressed therein, upon any certificates or
opinions furnished to the Guarantee Trustee and conforming to
the requirements of this Guarantee Agreement; provided,
however, that in the case of any such certificates or
opinions that by any provision hereof or the Trust
Indenture Act are specifically required to be furnished to
the Guarantee Trustee, the Guarantee Trustee shall be under
a duty to examine the same to determine whether or not they
conform to the requirements of this Guarantee Agreement or
the Trust Indenture Act, as the case may be;
(ii) the Guarantee Trustee shall not be liable for any error of
judgment made in good faith by a Responsible Officer of the
Guarantee Trustee, unless it
-8-
shall be proved that the Guarantee Trustee was negligent in
ascertaining the pertinent facts upon which such judgment was made;
(iii) the Guarantee Trustee shall not be liable with respect to
any action taken or omitted to be taken by it in good faith in
accordance with the direction of the Holders of a Majority of
Outstanding Securities relating to the time, method and place of
conducting any proceeding for any remedy available to the Guarantee
Trustee, or exercising any trust or power conferred upon the
Guarantee Trustee under this Guarantee Agreement; and
(iv) no provision of this Guarantee Agreement shall require the
Guarantee Trustee to expend or risk its own funds or otherwise incur
personalfinancial liability in the performance of any of its duties
or in the exercise of any of its rights or powers, if it shall have
reasonable grounds for believing that the repayment of such funds or
liability is not reasonably assured to it under the terms of this
Guarantee Agreement or adequate indemnity against such risk or
liability is not reasonably assured to it.
(c) Subject to the provisions of Section 3.02(a) and (b):
(i) whenever in the administration of this Guarantee Agreement,
the Guarantee Trustee shall deem it desirable that a matter be
proved or established prior to taking, suffering or omitting any
action hereunder, the Guarantee Trustee (unless other evidence is
herein conclusively specifically prescribed) may, in the absence of
bad faith on its part, request and rely upon an Officers'
Certificate, which, upon receipt of such request, shall be
promptly delivered by the Guarantor;
(ii) the Guarantee Trustee (A) may consult with counsel (which
may be counsel to the Guarantor or any of its Affiliates and may
include any of its employees) selected by it in good faith and with
due care and the advice or opinion of such counsel with respect to
legal matters shall be full and complete authorization and
protection in respect of any action taken, suffered or omitted by it
hereunder in good faith and in reliance thereon and in accordance
with such advice and opinion and (B) shall have the right at any
time to seek instructions concerning the administration of this
Guarantee Agreement from any court of competent jurisdiction;
(iii) the Guarantee Trustee may execute any of the trusts or
powers hereunder or perform any duties hereunder either directly or
by or through agents or attorneys, and the Guarantee Trustee shall
not be responsible for any misconduct or negligence on the part of
any agent or attorney appointed by it in good faith and with due
care;
(iv) the Guarantee Trustee shall be under no obligation to
exercise any of the rights or powers vested in it by this Guarantee
Agreement at the request or direction of any Holder, unless such
Holder shall have offered to the Guarantee Trustee security and
indemnity satisfactory to the Guarantee Trustee against the
-9-
costs, expenses (including attorneys' fees and expenses) and
liabilities that might be incurred by it in complying with such
request or direction; provided that nothing contained in this clause
(iv) shall relieve the Guarantee Trustee of the obligation, upon the
occurrence of a Guarantee Event of Default (which has not been cured
or waived)to exercise such of the rights and powers vested in it by
this Guarantee Agreement, and to use the same degree of care and
skill in this exercise as a prudent person would exercise or use
under the circumstances in the conduct of his own affairs; and
(v) any action taken by the Guarantee Trustee or its agents
hereunder shall bind the Holders, and the signature of the Guarantee
Trustee or its agents alone shall be sufficient and effective to
perform any such action; and no third party shall be required to
inquire as to the authority of the Guarantee Trustee to so act, or
as to its compliance with any of the terms and provisions of this
Guarantee Agreement, both of which shall be conclusively evidenced
by the Guarantee Trustee's or its agent's taking such action.
Section 3.03 Not Responsible for Recitals or Issuance of Guarantee.
The recitals contained in this Guarantee Agreement shall be taken as
the statements of the Guarantor, and the Guarantee Trustee does not assume any
responsibility for their correctness. The Guarantee Trustee makes no
representations as to the validity or sufficiency of this Guarantee Agreement.
Section 3.04 The Guarantee Trustee May Own Securities.
------------------------------------------
The Guarantee Trustee, in its individual or any other capacity, may
become the owner or pledgee of Securities and may otherwise deal with the
Guarantor with the same rights it would have if it were not the Guarantee
Trustee.
Section 3.05 Moneys Received by the Guarantee Trustee to Be Held in
------------------------------------------------------
Trust Without Interest.
-----------------------
All moneys received by the Guarantee Trustee in respect of Guarantee
Payments shall, until used or applied as herein provided, be held in trust for
the purposes for which they were received, but need not be segregated from other
funds except to the extent required by law. The Guarantee Trustee shall be under
no liability for interest on any moneys received by it hereunder except such as
it may agree in writing to pay thereon.
Section 3.06 Compensation and Expenses of Guarantee Trustee.
-----------------------------------------------
The Guarantor covenants and agrees to pay to the Guarantee Trustee
from time to time, and the Guarantee Trustee shall be entitled to, such
compensation as the Guarantor and the Guarantee Trustee shall from time to time
agree in writing (which shall not be limited by any provision of law in regard
to the compensation of a Guarantee Trustee of an express trust) for all services
rendered by it in the exercise and performance of any of the powers and duties
hereunder of the Guarantee Trustee, and the Guarantor will pay or reimburse the
Guarantee Trustee upon its request for all reasonable expenses, disbursements
and advances incurred or
-10-
made by the Guarantee Trustee in accordance with any of the provisions of this
Guarantee Agreement (including the reasonable compensation and the reasonable
expenses and disbursements of its counsel and of all persons not regularly in
its employ) except any such expense, disbursement or advance as may arise from
its negligence or bad faith. The Guarantor also covenants to indemnify each of
the Guarantee Trustee or any predecessor Guarantee Trustee and their officers,
agents, directors and employees for, and to hold them harmless against, any and
all loss, liability, damage, claim or expense including taxes (other than taxes
based upon, measured by or determined by the income, profit, franchise or doing
business of the Guarantee Trustee)incurred without negligence or bad faith on
the part of the Guarantee Trustee and arising out of or in connection with the
acceptance or administration of this trust, including the reasonable costs and
expenses of defending itself against any claim (whether asserted by the
Guarantor, any Holder or any other Person) of liability in the premises. The
provisions of this Section 3.06 shall survive the termination of this Guarantee
Agreement and resignation or removal of the Guarantee Trustee.
ARTICLE IV
GUARANTEE TRUSTEE
Section 4.01 Qualifications.
---------------
There shall at all times be a Guarantee Trustee that shall:
(i) not be an Affiliate of the Guarantor; and
(ii) be a national banking association or corporation organized
and doing business under the laws of the United States of America or
any State or Territory thereof or of the District of Columbia, or a
corporation or Person permitted by the Commission to act as an
institutional trustee under the Trust Indenture Act, authorized
under such laws to exercise corporate trust powers, having a
combined capital and surplus of at least $50,000,000, and subject to
supervision or examination by Federal, State, Territorial or
District of Columbia authority. If such corporation publishes
reports of condition at least annually, pursuant to law or to the
requirements of the supervising or examining authority referred to
above, then for the purposes of this clause (ii), the combined
capital and surplus of such corporation shall be deemed to be its
combined capital and surplus as set forth in its most recent report
of condition so published.
If at any time the Guarantee Trustee shall cease to satisfy the
requirements of clauses (i) and (ii) above, the Guarantee Trustee shall
immediately resign in the manner and with the effect set out in Section 4.02. If
the Guarantee Trustee has or shall acquire any "conflicting interest" within the
meaning of Section 310(b) of the Trust Indenture Act, the Guarantee Trustee and
the Guarantor shall in all respects comply with the provisions of Section 310(b)
of the Trust Indenture Act.
-11-
Section 4.02 Appointment, Removal and Resignation of the Guarantee
-----------------------------------------------------
Trustee.
-------
(a) Subject to Section 4.02(b), the Guarantee Trustee may be
appointed or removed without cause at any time by the Guarantor.
(b) The Guarantee Trustee shall not be removed in accordance with
Section 4.02(a) until a Successor Guarantee Trustee possessing the
qualifications to act as Guarantee Trustee under Section 4.01 has been appointed
and has accepted such appointment by written instrument executed by such
Successor Guarantee Trustee and delivered to the Guarantor and the Guarantee
Trustee being removed.
(c) The Guarantee Trustee appointed to office shall hold office until
its successor shall have been appointed or until its removal or resignation.
(d) The Guarantee Trustee may resign from office (without need for prior
or subsequent accounting) by an instrument (a "Resignation Request") in writing
signed by the Guarantee Trustee and delivered to the Guarantor, which
resignation shall take effect upon such delivery or upon such later date as is
specified therein; provided, however, that no such resignation of the Guarantee
Trustee shall be effective until a Successor Guarantee Trustee possessing the
qualifications to act as Guarantee Trustee under Section 4.01 has been appointed
and has accepted such appointment by instrument executed by such Successor
Guarantee Trustee and delivered to the Guarantor and the resigning Guarantee
Trustee.
(e) If no Successor Guarantee Trustee shall have been appointed and
accepted appointment as provided in this Section 4.02 within 60 days after
delivery to the Guarantor of a Resignation Request or the Guarantee Trustee is
removed, the resigning Guarantee Trustee may petition any court of competent
jurisdiction for appointment of a Successor Guarantee Trustee. Such court may
thereupon after such notice, if any, as it may deem proper, appoint a Successor
Guarantee Trustee.
ARTICLE V
GUARANTEE
Section 5.01 Guarantee.
----------
The Guarantor irrevocably and unconditionally agrees to pay in full
to the Holders the Guarantee Payments (without duplication of amounts
theretofore paid by the Issuer), as and when due, regardless of any defense,
right of set-off or counterclaim which the Issuer may have or assert. The
Guarantor's obligation to make a Guarantee Payment may be satisfied by direct
payment of the required amounts by the Guarantor to the Holders or to the
Guarantee Trustee for remittance to the Holders or by causing the Issuer to pay
such amounts to the Holders. If a Trust Enforcement Event has occurred and is
continuing, the rights of the Holders of the Common Securities to receive
Guarantee Payments will be subordinated to the rights of the Holders of
Preferred Securities to receive Guarantee Payments.
-12-
Section 5.02 Waiver of Notice.
-----------------
The Guarantor hereby waives notice of acceptance of this Guarantee
Agreement and of any liability to which it applies or may apply, presentment,
demand for payment, any right to require a proceeding first against the Issuer
or any other Person before proceeding against the Guarantor, protest, notice of
nonpayment, notice of dishonor, notice of redemption and all other notices and
demands. Notwithstanding anything to the contrary herein, the Guarantor retains
all of its rights under the Indenture to extend the interest payment period on
the Notes and the Guarantor shall not be obligated hereunder to make any
Guarantee Payment during any extension of any Interest Payment Period (as
defined in the Supplemental Indenture) with respect to the Distributions on the
Securities.
Section 5.03 Obligations Not Affected.
-------------------------
The obligations, covenants, agreements and duties of the Guarantor
under this Guarantee Agreement shall in no way be affected or impaired by reason
of the happening from time to time of any of the following:
(a) the release or waiver, by operation of law or otherwise, of the
performance or observance by the Issuer of any express or implied agreement,
covenant, term or condition relating to the Securities to be performed or
observed by the Issuer;
(b) the extension of time for the payment by the Issuer of all or any
portion of the Distributions (other than an extension of time for payment of
Distributions that result from any Extended Interest Payment Period), Redemption
Price, (as may be defined in the Declaration) or any other sums payable under
the terms of the Securities or the extension of time for the performance of any
other obligation under, arising out of, or in connection with, the Securities
(other than an extension of time for payment of Distributions that result from
any Extension Period);
(c) any failure, omission, delay or lack of diligence on the part of the
Guarantee Trustee or the Holders to enforce, assert or exercise any right,
privilege, power or remedy conferred on the Guarantee Trustee or the Holders
pursuant to the terms hereof or of the Securities, respectively, or any action
on the part of the Issuer granting indulgence or extension of any kind;
(d) the voluntary or involuntary liquidation, dissolution, sale of any
collateral, receivership, insolvency, bankruptcy, assignment for the benefit of
creditors, reorganization, arrangement, composition or readjustment of debt of,
or other similar proceedings affecting, the Issuer or any of the assets of the
Issuer;
(e) any invalidity of, or defect or deficiency in, the Securities;
(f) the settlement or compromise of any obligation guaranteed hereby
or hereby incurred; or
(g) any other circumstance whatsoever that might otherwise constitute a
legal or equitable discharge or defense of a guarantor, it being the intent of
this Section 5.03 that the
-13-
obligations of the Guarantor with respect to the Guarantee Payments shall be
absolute and unconditional under any and all circumstances.
There shall be no obligation of the Guarantee Trustee or the Holders
to give notice to, or obtain consent of, the Guarantor with respect to the
happening of any of the foregoing.
Section 5.04 Enforcement of Guarantee.
-------------------------
The Guarantor and the Guarantee Trustee expressly acknowledge and
agree that (i) this Guarantee Agreement will be deposited with the Guarantee
Trustee to be held for the benefit of the Holders; (ii) the Guarantee Trustee
has the right to enforce this Guarantee Agreement on behalf of the Holders;
(iii) Holders representing not less than a Majority of Outstanding Securities
have the right to direct the time, method and place of conducting any proceeding
for any remedy available to the Guarantee Trustee in respect of this Guarantee
Agreement or exercising any trust or other power conferred upon the Guarantee
Trustee under this Guarantee Agreement; and (iv) if the Guarantee Trustee fails
to enforce this Guarantee Agreement as provided in clauses (ii) and (iii) above,
any Holder may institute a legal proceeding directly against the Guarantor to
enforce its rights under this Guarantee Agreement, without first instituting a
legal proceeding against the Issuer, the Guarantee Trustee or any other Person.
Notwithstanding the foregoing, if the Guarantor has failed to make a Guarantee
Payment, a Holder may directly institute a proceeding against the Guarantor for
enforcement of this Guarantee Agreement for such payment without first
instituting a legal proceeding against the Issuer, the Guarantee Trustee or any
other Person.
Section 5.05 Guarantee of Payment.
---------------------
This Guarantee Agreement creates a guarantee of payment and not
merely of collection. This Guarantee Agreement will not be discharged except by
payment of the Guarantee Payments in full (without duplication of amounts
theretofore paid by the Issuer) or upon the distribution of the Notes to the
Holders as provided in the Declaration.
Section 5.06 Subrogation.
------------
The Guarantor shall be subrogated to all (if any) rights of the
Holders against the Issuer in respect of any amounts paid to the Holders by the
Guarantor under this Guarantee Agreement; provided, however, that the Guarantor
shall not (except to the extent required by mandatory provisions of law) be
entitled to enforce or exercise any rights which it may acquire by way of
subrogation or any indemnity, reimbursement or other agreement, in all cases as
a result of payment under this Guarantee Agreement, if, at the time of any such
payment, any amounts are due and unpaid under this Guarantee Agreement. If any
amount shall be paid to the Guarantor in violation of the preceding sentence,
the Guarantor agrees to hold such amount in trust for the Holders and to pay
over such amount to the Holders or to the Guarantee Trustee for remittance to
the Holders.
Section 5.07 Independent Obligations.
------------------------
The Guarantor acknowledges that its obligations hereunder are
independent of the obligations of the Issuer with respect to the Securities and
that the Guarantor shall be liable as
-14-
principal and as debtor hereunder to make Guarantee Payments pursuant to the
terms of this Guarantee Agreement notwithstanding the occurrence of any event
referred to in subsections (a) through (g), inclusive, of Section 5.03 hereof.
-15-
ARTICLE VI
LIMITATION OF TRANSACTIONS; SUBORDINATION
Section 6.01 Limitation of Transactions. So long as any Securities
remain outstanding, and if at such time (i) the Guarantor shall be in default
with respect to its Guarantee Payments or other payment obligations hereunder,
(ii) there shall have occurred and be continuing any Event of Default under the
Declaration or (iii) the Guarantor shall have given notice of its election of an
Extension Period and such period, or any extension thereof, is continuing, the
Guarantor shall not (1) make any payment of principal, interest or premium, if
any, on or repay, repurchase or redeem any debt securities that rank equally
with or junior in interest to the Notes in the right of payment issued by the
Guarantor, except, in the case of an Extension Period, payments as contemplated
under the Indenture, or make any guarantee payments with respect to any
guarantee by the Guarantor of any securities of any of its subsidiaries if such
guarantee ranks junior to the Notes in right of payment, except, in the case of
an Extension Period, payments as contemplated under the Indenture, or (2)
declare or pay any dividends or distributions on, or redeem, purchase, acquire
or make a liquidation payment with respect to, any of the Guarantor's capital
stock, except, in each of cases (1) and (2), nothing contained therein shall
prevent the Guarantor from (a) purchasing or acquiring its capital stock in
satisfaction of its obligations under any benefit plans for the Guarantor and
the Guarantor's subsidiaries' directors, officers or employees or under any
dividend reinvestment plans, or pursuant to any contract or security outstanding
(other than a contract or security ranking expressly by its terms on a parity
with or junior to the Notes), (b) effecting the reclassification of the
Company's capital stock, or any exchange or conversion of one class of the
Company's capital stock for another class or series of the Company's capital
stock (including, without limitation, such reclassifications as have been
approved by the Company's stockholders prior to the date hereof as set forth in
the in the prospectus contained in the Company's and the Trust's Registration
Statement on Form S-3 filed April 6, 2001 under "Description of Our Class A and
Class B Common Stock - Reverse/Forward Stock Split" and "--Reclassification of
our Existing Two Classes of Common Stock into a Single New Class of Common
Stock"), (c) purchasing of fractional interests in shares of the Guarantor's
capital stock pursuant to the conversion or exchange provisions of such capital
stock or the security being converted or exchanged, (d) declaring dividends or
distributions in the Common Stock; (e) making any declaration of a dividend in
connection with the implementation of a shareholder's rights plan, or the
issuance of shares under any such plan in the future, or the redemption or
repurchase of any such rights pursuant thereto; and (f) making any payments
under this Guarantee. In addition, so long as any Securities remain outstanding,
the Guarantor (i) will remain the sole direct or indirect owner of all of the
outstanding Common Securities and shall not cause or permit the Common
Securities to be transferred except to the extent such transfer is permitted
under Section 7.9 of the Declaration; provided that any permitted successor of
the Guarantor under the Indenture may succeed to the Guarantor's direct or
indirect ownership of the Common Securities, and (ii) will use reasonable
efforts to cause the Issuer to continue to be treated as a grantor trust for
United States federal income tax purposes, except in connection with a
distribution of Notes as provided in the Declaration.
Section 6.02 Subordination.
--------------
This Guarantee Agreement will constitute an unsecured obligation of
the Guarantor and will rank (i) subordinate and junior in right of payment to
all other liabilities of the
-16-
Guarantor and any guarantees of the Guarantor relating to such liabilities,
except in each case those made pari passu or subordinate by their terms, and
(ii) senior to all capital stock and to any guarantee now or hereafter entered
into by the Guarantor in respect of any of its capital stock now or hereafter
issued by the Guarantor. The Guarantor's obligations under this Guarantee
Agreement will rank pari passu with respect to obligations under other
securities (other than capital stock) the Guarantor may issue from time to time
and other guarantee agreements which it may enter into from time to time to the
extent that (i) such agreements shall provide for comparable guarantees by the
Guarantor of payment on preferred securities issued by other trusts,
partnerships or other entities affiliated with the Guarantor that are financing
vehicles of the Guarantor and (ii) the Notes or other evidences of indebtedness
of the Guarantor relating to such preferred securities are subordinated,
unsecured indebtedness of the Guarantor.
Section 6.03 Ranking.
--------
If a Trust Enforcement Event has occurred and is continuing under
the Declaration, the rights of the Holders of the Common Securities to receive
Guarantee Payments will be subordinated to the rights of the Holders of
Preferred Securities to receive Guarantee Payments.
ARTICLE VII
TERMINATION
Section 7.01 Termination.
------------
This Guarantee Agreement shall terminate and be of no further force
and effect (i) upon full payment of the Redemption Price of all Securities, (ii)
upon the distribution of Notes to Holders and holders of Common Securities in
exchange for all of the Preferred Securities and Common Securities or (iii) upon
full payment of the amounts payable in accordance with the Declaration upon
liquidation of the Issuer. Notwithstanding the foregoing, this Guarantee
Agreement will continue to be effective or will be reinstated, as the case may
be, if at any time any Holder must restore payment of any sums paid with respect
to the Securities or under this Guarantee Agreement.
ARTICLE VIII
LIMITATION OF LIABILITY; INDEMNIFICATION
Section 8.01 Exculpation.
------------
(a) No Indemnified Person shall be liable, responsible or accountable in
damages or otherwise to the Guarantor or any Holder for any loss, damage or
claim incurred by reason of any act or omission performed or omitted by such
Indemnified Person in good faith in accordance with this Guarantee Agreement and
in a manner such Indemnified Person reasonably believed to be within the scope
of the authority conferred on such Indemnified Person by this Guarantee
Agreement or by law, except that an Indemnified Person shall be liable for any
such loss, damage or claim incurred by reason of such Indemnified Person's
negligence or willful misconduct with respect to such acts or omissions.
-17-
(b) An Indemnified Person shall be fully protected in relying in good
faith upon the records of the Guarantor and upon such information, opinions,
reports or statements presented to the Guarantor by any Person as to matters the
Indemnified Person reasonably believes are within such other Person's
professional or expert competence and who has been selected with reasonable care
by or on behalf of the Guarantor, including information, opinions, reports or
statements as to the value and amount of the assets, liabilities, profits,
losses or any other facts pertinent to the existence and amount of assets from
which Distributions to Holders might properly be paid.
Section 8.02 Indemnification.
----------------
To the fullest extent permitted by applicable law, the Guarantor
shall indemnify and hold harmless each Indemnified Person from and against any
loss, damage or claim incurred by such Indemnified Person by reason of any act
or omission performed or omitted by such Indemnified Person in good faith in
accordance with this Guarantee Agreement and in a manner such Indemnified Person
reasonably believed to be within the scope of authority conferred on such
Indemnified Person by this Guarantee Agreement, except that no Indemnified
Person shall be entitled to be indemnified in respect of any loss, damage or
claim incurred by such Indemnified Person by reason of negligence or willful
misconduct with respect to such acts or omissions.
Section 8.03 Survive Termination.
--------------------
The provisions of Sections 8.01 and 8.02 shall survive the
termination of this Guarantee Agreement or the resignation or removal of the
Guarantee Trustee.
ARTICLE IX
MISCELLANEOUS
Section 9.01 Successors and Assigns.
-----------------------
All guarantees and agreements contained in this Guarantee Agreement
shall bind the successors, assignees, receivers, trustees and representatives of
the Guarantor and shall inure to the benefit of the Guarantee Trustee and the
Holders then outstanding. Except in connection with a consolidation, merger or
sale involving the Guarantor that is permitted under Article X of the Indenture,
the Guarantor shall not assign its obligations hereunder.
Section 9.02 Amendments.
-----------
Except with respect to any changes which do not adversely affect the
rights of Holders in any material respect (in which case no consent of Holders
will be required), this Guarantee Agreement may only be amended with the prior
approval of the Guarantor, the Guarantee Trustee and the Holders of not less
than a Majority of Outstanding Securities. The provisions of Section 11.2 of the
Declaration concerning meetings, and actions by written consent without a
meeting, of Holders shall apply to the giving of such approval.
-18-
Section 9.03 Notices.
--------
Any notice, request or other communication required or permitted to
be given hereunder shall be in writing, in English, duly signed by the party
giving such notice, and delivered, telecopied or mailed by first class mail as
follows:
(a) if given to the Guarantor, to the address set forth below or such
other address as the Guarantor may give notice of to the Holders:
Raytheon Company
000 Xxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxxxxxx 00000
Attention: General Counsel
(b) if given to the Guarantee Trustee, to the address set forth below
or such other address as the Guarantee Trustee may give notice of to the
Holders:
The Bank of New York
000 Xxxxxxx Xxxxxx
Xxxxx 00 Xxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Corporate Trust Administration
(c) if given to any Holder, at the address set forth on the books and
records of the Issuer.
All notices hereunder shall be deemed to have been given when (i)
received in person, (ii) telecopied with receipt confirmed, or (iii) mailed by
first class mail, postage prepaid, when received, except that if a notice or
other document is refused delivery or cannot be delivered because of a changed
address of which no notice was given, such notice or other document shall be
deemed to have been delivered on the date of such refusal or inability to
deliver.
Section 9.04 Genders.
--------
The masculine, feminine and neuter genders used herein shall include
the masculine, feminine and neuter genders.
Section 9.05 Benefit.
--------
This Guarantee Agreement is solely for the benefit of the Guarantee
Trustee and the Holders and, subject to Section 3.01(a), is not separately
transferable from the Securities.
Section 9.06 Governing Law.
--------------
THIS GUARANTEE AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, INCLUDING
SECTION 5-1401 OF THE NEW YORK GENERAL
-19-
OBLIGATIONS LAW, WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAWS.
Section 9.07 Counterparts.
-------------
This Guarantee Agreement may be executed in counterparts, each of
which shall be an original; but such counterparts shall together constitute one
and the same instrument.
Section 9.08 Limited Liability.
------------------
Neither the Guarantee Trustee nor the Holders, in their capacities
as such, shall be personally liable for any liabilities or obligations of the
Guarantor arising out of this Guarantee Agreement. The parties further hereby
agree that the Holders, in their capacities as such, shall be entitled to the
same limitation of personal liability extended to the stockholders of private
corporations for profit organized under the General Corporation Law of the State
of Delaware.
-20-
THIS GUARANTEE AGREEMENT is executed as of the day and year first
above written.
RAYTHEON COMPANY
By: /s/ Xxxxxxx Xxxxxx
--------------------
Name:Xxxxxxx Xxxxxx
Title: Vice President and Treasurer
THE BANK OF NEW YORK
as Guarantee Trustee
By: /s/ Xxxxx Xxxxxx
-------------------
Name:Xxxxx Xxxxxx
Title: Assistant Treasurer
[Signature Page to Guarantee Agent]
