AMENDMENT NO. 2 TO TRANSACTION AGREEMENT
This Amendment No. 2 to Transaction Agreement (the "Amendment") is made
as of the 30th day of April, 1997, by and among Lockheed Xxxxxx Corporation,
a Maryland corporation ("Lockheed Xxxxxx"), Xxxxxx Brothers Capital Partners
III, L.P., a Delaware limited partnership ("Xxxxxx"), Xxxxx X. Xxxxx
("Xxxxx"), Xxxxxx X. XxXxxxx ("XxXxxxx"; and together with Xxxxx, the
"Individual Purchasers") and L-3 Communications Holdings, Inc., a Delaware
corporation ("Newco"). For purposes of this Amendment, Xxxxxx, Xxxxx and
XxXxxxx each are individually referred to as a "Purchaser" and collectively
referred to as the "Purchasers."
W I T N E S S E T H:
WHEREAS, Lockheed Xxxxxx, in its own right and through certain of its
direct and indirect Subsidiaries is engaged in the Business;
WHEREAS, Lockheed Xxxxxx and the Purchasers, upon the terms and subject
to the conditions of the Agreement have agreed to the formation and
organization of Newco;
WHEREAS, upon the terms and subject to the conditions of the Agreement,
Lockheed Xxxxxx has agreed to transfer, or to cause the Affiliated
Transferors to transfer, substantially all of the assets held or owned by, or
used to conduct, the Business and to assign certain liabilities associated
with the Business to Newco, and Newco has agreed to receive such assets and
assume such liabilities; and
WHEREAS, Lockheed Xxxxxx, Newco and the Purchasers desire to amend the
Agreement in accordance with the terms of this Amendment;
NOW, THEREFORE, in consideration of the mutual covenants and agreements
of the parties contained herein, the parties agree as follows:
Section 1. Capitalized terms used but not defined herein have the
meanings given to them in the Transaction Agreement dated as of March 28,
1997, by and among Lockheed Xxxxxx, Newco and the Purchasers, as amended by
Amendment No. 1 to Transaction Agreement dated as of April 11, 1997 (as
amended, the "Agreement").
Section 2. The list of Attachments set forth in the index to the
Agreement is revised by amending the description of Attachment XI to read as
follows: "Other Transferred Employees".
Section 3. Section 2.04(i) of the Agreement is amended by deleting
the references to "$269,118,000" in the first parenthetical of that Section
and inserting in their place and stead "$272,618,000".
Section 4. Notwithstanding the provisions of Section 15.13(c) of the
Agreement, for purposes of the Agreement, Attachment IV shall be as set forth
in Exhibit A to this Amendment.
Section 5. Notwithstanding the provisions of Section 15.13(c) of the
Agreement, for purposes of the Agreement, Attachment V shall be as set forth
in Exhibit B to this Amendment.
Section 6. Notwithstanding the provisions of Section 15.13(c) of the
Agreement, for purposes of the Agreement, Attachment VIII shall be as set
forth in Exhibit C to this Amendment.
Section 7. Notwithstanding the provisions of Section 15.13(c) of the
Agreement, for purposes of the Agreement, Attachment IX shall be as set forth
in Exhibit D to this Amendment.
Section 8. Notwithstanding the provisions of Section 15.13(b) of the
Agreement, for purposes of the Agreement, Attachment X shall as set forth in
Exhibit E to this Amendment.
Section 9. Notwithstanding the provisions of Section 15.13(c) of the
Agreement, for purposes of the Agreement, Attachment XI shall be as set forth
in Exhibit F to the Amendment.
Section 10. For purposes of the Agreement, Attachment XIV shall be as
set forth in Exhibit G to this Amendment.
Section 11. Notwithstanding the provisions of Section 15.13(c) of the
Agreement, for purposes of the Agreement, Attachment XV shall be as set forth
in Exhibit H to this Amendment.
Section 12. The Disclosure Schedules attached to this Amendment as
Exhibit I are, and for all purposes shall be, the Disclosure Schedules
referenced in the Agreement.
Section 13. Section 7.04 of the Agreement is amended by deleting the
reference to "Attachment XI" in the second parenthetical of the first
sentence and inserting in its place and stead the phrase "writing by Lockheed
Xxxxxx and Newco on or prior to the Closing Date".
Section 14. Section 8.04 of the Agreement is amended by deleting the
reference to "Attachment XI" in the second parenthetical of the first
sentence and inserting in its place and stead the phrase "writing by Lockheed
Xxxxxx and Newco on or prior to the Closing Date".
Section 15. Section 13.02(b) of the Agreement is amended by deleting
the word "or" before the beginning of clause (v); inserting the phrase ", or
(vi) the Universal Litigation" after clause (v) and before the semicolon;
deleting the word "and" before "(v)" in the proviso; and inserting the phrase
"and (vi)" after "(v)" in the proviso.
Section 16. Section 13.04(b)(iii) of the Agreement is amended by
deleting the word "and" after the semicolon.
Section 17. Section 13.04(b)(iv) of the Agreement is amended by
deleting the period at the end and inserting in its place and stead the
phrase "; and".
Section 18. Section 13.04(b) of the Agreement is amended by adding a
new clause (v) as follows:
"(v) with respect to the matter described in clause (vi)
of Section 13.02(b) (after giving effect to the proviso
thereto), to the extent of 50% of the aggregate Damages
incurred by all Indemnified Parties as the result thereof in
excess of the Reserve Amount but not in excess of the Reserve
Amount plus $1,000,000 (it being understood that Lockheed
Xxxxxx'x maximum liability under Section 13.02(b)(vi) and this
Section 13.04(b)(v) shall be $500,000)."
Section 19. Section 15.01 of the Agreement is amended to change the
notice address for notices to Newco to the following:
"L-3 Communications Holdings, Inc.
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx X. XxXxxxx
Telecopy: (000) 000-0000"
Section 20. Section (a) of Exhibit A to the Agreement is amended by
adding the following after the definition of "Prime Government Contract" and
before the definition of "Remedial Action(s)":
""Reserve Amount" means the amount referenced in the
letter from Lockheed Xxxxxx to Newco dated as of the Closing
Date making specific reference to the Agreement and this
definition.
Section 21. Section (a) of Exhibit A to the Agreement is amended by
adding the following after the definition of "Transferred Assets" and before
the definition of "U.S. Government":
""Universal Litigation" means the matter titled Universal
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Navigation Corporation, a California corporation; and
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Microcomputer Electronics Corporation, a Washington
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corporation v. Loral Corporation, a New York corporation; and
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Xxxxx Xxxxxxxxx Corp., a Delaware corporation (CIV93-743TUC
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WDB) pending in the United States District Court for the
District of Arizona."
Section 22. Clause (ii) of the definition of "Transferred Employee"
in Section G.01 of Exhibit G to the Agreement is amended by deleting the
existing provision in its entirety and inserting in its place and stead the
following:
"(ii) was laid off from the Business and has recall rights
with respect to the Business other than any Person with such
rights who is either employed by Lockheed Xxxxxx on the
Closing Date (other than in the Business) or who has recall
rights at another Lockheed Xxxxxx facility, or"
Section 23. Section G.08 of Exhibit G to the Agreement is amended by
deleting the existing provision in its entirety and inserting in its place
and stead the following:
"G.08. Severance and Retention Agreements. In accordance with
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Section 6.9 of the Agreement and Plan of Merger dated as of January 7,
1996, by and among Loral Corporation, Lockheed Xxxxxx Corporation and
LAC Acquisition Corporation, Lockheed Xxxxxx Tactical Systems, Inc. has
adopted the Supplemental Severance Program. Lockheed Xxxxxx has entered
into Key Employee Supplemental Severance Program and Key Executive
Supplemental Severance Program agreements (the "Program Agreements").
In addition, Lockheed Xxxxxx has entered into Retention Agreements
(collectively with the Supplemental Severance Program and the Program
Agreements, the "Supplemental Agreements") with certain Transferred
Employees who participate in the Supplemental Severance Program.
Lockheed Xxxxxx also sponsors the Lockheed Xxxxxx Tactical Systems
Severance Plan (the "Tactical Severance Plan"), the Severance Benefit
Plan for Employees of Lockheed Xxxxxx Corporation (the "LMC Severance
Plan") and the Special Supplemental Severance Program relating to the
retention (as set forth in a memorandum from Xxxxx Xxxxxxx dated October
28, 1996 of C3I and Systems Integration Sector administrative personnel
(collectively with the Supplemental Agreements, the Tactical Severance
Plan and the LMC Severance Plan, the "Severance Arrangements"). Other
than with respect to the Transferred Employees set forth on Section B.21
of the Disclosure Schedules, Newco assumes all obligations and
liabilities of Lockheed Xxxxxx and its Affiliates under the Severance
Arrangements and any other severance benefit obligation (collectively
with the Severance Arrangements, the "Severance Obligations") whether
oral or written, for all claims made after the Closing Date by
Transferred Employees, including claims based on the Contemplated
Transactions, which shall be Assumed Liabilities for purposes of this
Agreement. All obligations and Liabilities of Lockheed Xxxxxx with
respect to any Severance Obligation for the Transferred Employees on
Section B.21 of the Disclosure Schedules and any other individual
covered by a Supplemental Agreement under any Severance Obligation who
is not a Transferred Employee shall constitute Excluded Liabilities."
IN WITNESS WHEREOF, the parties hereto caused this Amendment to be duly
executed by their respective authorized officers on the day and year first
above written.
LOCKHEED XXXXXX CORPORATION
By:________________________________
Name:
Title:
XXXXXX BROTHERS CAPITAL
PARTNERS III, L.P.
By: XXXXXX BROTHERS HOLDINGS INC.,
its General Partner
By:___________________________
Name:
Title:
XXXXX X. XXXXX
___________________________________
XXXXXX X. XXXXXXX
___________________________________
L-3 COMMUNICATIONS HOLDINGS, INC.
By:________________________________
Name:
Title:
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AMENDMENT NO. 2
Dated as of April 30, 1997
to
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.
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