EXHIBIT 10.72
EXECUTION VERSION
$600,000,000
L-3 COMMUNICATIONS HOLDINGS, INC.
3% CONVERTIBLE CONTINGENT DEBT SECURITIES (CODES) DUE 2035
PURCHASE AGREEMENT
July 27, 2005
XXXXXX BROTHERS INC.
BEAR, XXXXXXX & CO. INC.
CREDIT SUISSE FIRST BOSTON LLC
BANC OF AMERICA SECURITIES LLC
As representatives (the "Representatives") of the several
Initial Purchasers listed on Schedule 1 hereto
c/x Xxxxxx Brothers Inc.
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
L-3 Communications Holdings, Inc., a Delaware corporation (the
"Company"), proposes, subject to the terms and conditions stated herein, to
issue and sell $600,000,000 in aggregate principal amount of its 3% Convertible
Contingent Debt Securities CODES due 2035 (the "Firm CODES") to Xxxxxx Brothers
Inc., Bear, Xxxxxxx & Co. Inc., Credit Suisse First Boston LLC and Banc of
America Securities LLC (collectively, the "Initial Purchasers"). In addition,
the Company proposes to grant to the Initial Purchasers an option (the "Option")
to purchase up to an additional $100,000,000 in aggregate principal amount of 3%
Convertible Contingent Debt Securities CODES due 2035 (the "Optional CODES" and,
together with the Firm CODES, the "CODES").
The CODES will be convertible into fully paid, nonassessable shares of
common stock of the Company, par value $0.01 per share (the "Common Stock"), on
the terms, and subject to the conditions, set forth in the Indenture (as defined
below). As used herein, "Conversion Shares" means the shares of Common Stock
into which the CODES are convertible. The CODES will be issued pursuant to an
indenture (the "Indenture") to be dated as of the First Delivery Date (as
defined in Section 2(a)), between the Company and The Bank of New York, as
Trustee (the "Trustee"). The Company's obligations under the CODES, including
the due and punctual payment of interest on the CODES, will be unconditionally
guaranteed (the "Guarantees") by certain of the present domestic subsidiaries of
the Company, including, as of this date, L-3 Communications Corporation, a
Delaware corporation, Broadcast Sports Inc., a Delaware corporation, Xxxxxxxx
Inc., a Delaware corporation, Hygienetics Environmental Services, Inc., a
Delaware corporation, KDI Precision Products, Inc., a Delaware corporation, L-3
Communications AIS GP Corporation, a Delaware corporation, L-3 Communications
Vertex Aerospace LLC, a Delaware limited liability company, L-3 Communications
Avionics Systems, Inc., a Delaware corporation, L-3 Communications Aydin
Corporation, a Delaware corporation,
L-3 Communications CE Holdings, Inc., a Delaware corporation, L-3 Communications
Electron Technologies, Inc., a Delaware corporation, L-3 Communications ESSCO,
Inc., a Delaware corporation, L-3 Communications Flight International Aviation
LLC, a Delaware limited liability company, L-3 Communications Flight Capital
LLC, a Delaware limited liability company, L-3 Communications ILEX Systems,
Inc., a Delaware corporation, L-3 Communications Integrated Systems L.P., a
Delaware limited partnership, L-3 Communications Investments Inc., a Delaware
corporation, L-3 Communications Xxxxx Associates, Inc., a Delaware corporation,
L-3 Communications MAS (US) Corporation, a Delaware corporation, L-3
Communications Security and Detection Systems, Inc., a Delaware corporation, L-3
Communications Vector International Aviation LLC, a Delaware limited liability
company, MPRI, Inc., a Delaware corporation, Pac Ord Inc., a Delaware
corporation, Power Paragon, Inc., a Delaware corporation, Ship Analytics
International, Inc., a Delaware corporation, SPD Electrical Systems, Inc., a
Delaware corporation, SPD Switchgear Inc., a Delaware corporation, Wescam Air
Ops Inc., a Delaware corporation, Wescam Air Ops LLC, a Delaware limited
liability company, Wescam Holdings (US) Inc., a Delaware corporation, and Wescam
LLC, a Delaware limited liability company (individually a "Delaware Guarantor"
and collectively, the "Delaware Guarantors") and Apcom, Inc., a Maryland
corporation, D.P. Associates, Inc., a Virginia corporation, Electrodynamics,
Inc., an Arizona corporation, Interstate Electronics Corporation, a California
corporation, L-3 Communications Advanced Laser Systems Technology, Inc., a
Florida corporation, L-3 Communications Aeromet, Inc., an Oregon corporation,
L-3 Communications Avisys Corporation, a Texas corporation, L-3 Communications
Cincinnati Electronics Corporation, an Ohio corporation, L-3 Communications CSI,
Inc., a California corporation, L-3 Communications Government Services, Inc., a
Virginia corporation, L-3 Communications Infraredvision Technology corporation,
a California corporation, L-3 Communications Mobile-Vision, Inc., a New Jersey
corporation, L-3 Communications Sonoma EO, Inc., a California corporation, L-3
Communications Westwood Corporation, a Nevada corporation, MCTI Acquisition
Corporation, a Maryland corporation, Microdyne Communications Technologies
Incorporated, a Maryland corporation, Microdyne Corporation, a Maryland
corporation, Microdyne Outsourcing Incorporated, a Maryland corporation, Ship
Analytics, Inc., a Connecticut corporation, Ship Analytics USA, Inc., a
Connecticut corporation, SYColeman Corporation, a Florida corporation, Troll
Technology Corporation, a California corporation, Wescam Incorporated, a Florida
corporation and Wolf Coach, Inc., a Massachusetts corporation (individually a
"Non-Delaware Guarantor," collectively the "Non-Delaware Guarantors" and,
together with the Delaware Guarantors, the "Guarantors"). As used herein, the
term "CODES" shall include the Guarantees thereof by the Guarantors, unless the
context otherwise requires. Capitalized terms used but not defined herein shall
have the meanings given to such terms in the Indenture.
The CODES will be offered and sold to the Initial Purchasers without
being registered under the Securities Act of 1933, as amended (the "Securities
Act"), in reliance upon an exemption therefrom. Holders of the CODES (including
the Initial Purchasers and their direct and indirect transferees) will be
entitled to the benefits of a Resale Registration Rights Agreement, dated the
First Delivery Date, between the Company, the Guarantors and the Initial
Purchasers (the "Registration Rights Agreement"), pursuant to which the Company
and the Guarantors will agree to file with the Securities and Exchange
Commission (the "Commission") a shelf registration statement pursuant to Rule
415 under the Securities Act (the "Registration
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Statement") covering the resale of the CODES and the Conversion Shares, and to
use commercially reasonable efforts to cause the Registration Statement to be
declared effective.
This Agreement, the Indenture, the CODES, the Guarantees and the
Registration Rights Agreement are referred to herein collectively as the
"Operative Documents."
This is to confirm the agreement between the Company and the Initial
Purchasers concerning the issue, offer and sale of the CODES.
1. Representations, Warranties and Agreements of the Company and the
Guarantors. The Company and the Guarantors represent, warrant to and agree with
the Initial Purchasers that:
(a) The Company and the Guarantors have prepared a preliminary
offering memorandum dated July 25, 2005 (the "Preliminary Offering Memorandum")
and an offering memorandum dated July 27, 2005 (the "Offering Memorandum")
setting forth or incorporating by reference information concerning the Company,
the CODES, the Guarantees, the Registration Rights Agreement and the Common
Stock. Copies of the Offering Memorandum will be delivered by the Company to the
Initial Purchasers pursuant to the terms of this Agreement. As used in this
Agreement, "Offering Memorandum" means the Offering Memorandum as amended or
supplemented. The Preliminary Offering Memorandum and the Offering Memorandum
did not as of its date, and will not as of a Delivery Date (as defined in
Section 2(b)), contain any untrue statement of a material fact or omit to state
a material fact necessary in order to make the statements therein, in light of
the circumstances under which they were made, not misleading, provided that no
representation or warranty is made as to information contained in or omitted
from the Preliminary Offering Memorandum or the Offering Memorandum in reliance
upon and in conformity with written information furnished to the Company by or
on behalf of any Initial Purchaser through Xxxxxx Brothers Inc. specifically for
inclusion therein;
(b) Assuming the accuracy of the representations and warranties of the
Initial Purchasers contained in Section 7 and their compliance with the
agreements set forth therein, it is not necessary, in connection with the
issuance and sale of the CODES to the Initial Purchasers and the offer, resale
and delivery of the CODES by the Initial Purchasers in the manner contemplated
by this Agreement, the Indenture, the Registration Rights Agreement and the
Offering Memorandum, to register the CODES or the Conversion Shares under the
Securities Act or to qualify the Indenture under the Trust Indenture Act of
1939, as amended (the "Trust Indenture Act");
(c) The market-related and customer-related data and estimates
included in the Offering Memorandum are based on or derived from sources which
the Company believes to be reliable and accurate;
(d) The Company and each of its subsidiaries (as defined in Section
16) have been duly organized and are validly existing as corporations, limited
partnerships or limited liability companies, as applicable, in good standing
under the laws of their respective jurisdictions of organization, are duly
qualified to do business and are in good standing as foreign corporations in
each jurisdiction in which their respective ownership or lease of property or
the conduct of their respective businesses requires such qualification except
for such
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qualification and good standing the failure of which, individually or in the
aggregate, would not result in a material adverse effect on the condition
(financial or other), business, prospects, properties, stockholders' equity or
results of operations of the Company and its subsidiaries taken as a whole (a
"Material Adverse Effect"), and have all power and authority necessary to own or
hold their respective properties and to conduct the businesses in which they are
engaged;
(e) The Company has an authorized capitalization as set forth in the
Offering Memorandum, and all of the issued and outstanding shares of capital
stock of the Company have been duly and validly authorized and issued, are fully
paid and non-assessable and conform to the description thereof contained in the
Offering Memorandum; and 100% of the issued shares of capital stock or
membership interests of each Guarantor of the Company have been duly and validly
authorized and issued and are fully paid and non-assessable and (except for
directors' qualifying shares) are owned directly or indirectly by the Company or
a subsidiary of the Company, free and clear of all liens, encumbrances, equities
or claims, other than (A) liens, encumbrances, equities or claims described in
the Offering Memorandum, (B) a pledge of such shares or membership interests to
secure the Senior Credit Facility (as described in the Offering Memorandum) and
(C) such other liens, encumbrances, equities or claims as are not, individually
or in the aggregate, material to the Company and its subsidiaries, taken as a
whole;
(f) The Conversion Shares which are authorized on the date hereof have
been duly and validly authorized and reserved for issuance upon conversion of
the CODES and are free of preemptive rights; and all Conversion Shares, when so
issued and delivered upon such conversion in accordance with the terms of the
Indenture, will be duly and validly authorized and issued, fully paid and
non-assessable and free and clear of all liens, encumbrances, equities or
claims;
(g) This Agreement has been duly authorized, executed and delivered by
the Company and the Guarantors;
(h) The execution, delivery and performance of this Agreement, the
Registration Rights Agreement and the Indenture by the Company and the
Guarantors and the consummation of the transactions contemplated hereby and
thereby, and the issuance and delivery of the CODES and the Conversion Shares
will not conflict with, constitute or result in a breach or violation of any of
the terms or provisions of, or constitute a default under, any indenture,
mortgage, deed of trust, loan agreement or other agreement or instrument to
which the Company or any of its subsidiaries is a party or by which the Company
or any of its subsidiaries is bound or to which any of the properties or assets
of the Company or any of its subsidiaries is subject that is material to the
financial condition or prospects of the Company and its subsidiaries, taken as a
whole (collectively, the "Material Agreements"), except for breach of which,
individually, or in the aggregate, would not result in a Material Adverse
Effect, nor will such actions result in any violation of the provisions of the
charter, by-laws or other organizational documents of the Company or any of its
subsidiaries or any material law, statute or any order, rule or regulation of
any court or governmental agency or body having jurisdiction over the Company or
any of its subsidiaries or any of their properties or assets, provided that the
provisions for indemnification and contribution hereunder and thereunder may be
limited by equitable principles and public policy consideration; and except (i)
with respect to the transactions contemplated by the Registration Rights
Agreement as may be required under the
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Securities Act, the Trust Indenture Act and the rules and regulations
promulgated thereunder, or (ii) as required by state securities or "blue sky"
laws, no consent, approval, authorization or order of, or filing or registration
with, any such court or governmental agency or body is required for the
execution, delivery and performance of the Operative Documents by the Company
and the Guarantors, as applicable, and the consummation of the transactions
contemplated hereby and thereby. No qualification of the Indenture under the
Trust Indenture Act of 1939, as amended (the "1939 Act"), is required in
connection with the sale of the CODES by the Initial Purchasers;
(i) The Company and the Guarantors have all requisite power and
authority to execute and deliver this Agreement and perform their obligations
hereunder; and this Agreement and the transactions contemplated hereby have been
duly authorized, executed and delivered by the Company and the Guarantors;
(j) The Company has all requisite power and authority to execute and
deliver the Indenture and perform its obligations thereunder; the Indenture has
been duly and validly authorized by the Company and each of the Guarantors, and
upon the effectiveness of the Registration Statement, will be qualified under
the Trust Indenture Act; on the First Delivery Date (as defined below in Section
2(a)), the Indenture will have been duly executed by the proper officers of the
Company and delivered by the Company and each of the Guarantors and, assuming
that the Indenture is the valid and binding obligation of the Trustee, will
constitute a legally valid and binding agreement of the Company and each of the
Guarantors enforceable in accordance with its terms, except as the
enforceability thereof may be limited by bankruptcy, insolvency, fraudulent
transfer, reorganization, moratorium and other similar laws relating to or
affecting creditors' rights generally, subject to general principles of equity
and to limitations on availability of equitable relief, including specific
performance (whether considered in a proceeding in equity or at law) and an
implied covenant of good faith and fair dealing; and the Indenture will conform
in all material respects to the description thereof contained in the Offering
Memorandum;
(k) The Company has all requisite power and authority to execute and
deliver the Registration Rights Agreement and perform its obligations
thereunder; the Registration Rights Agreement and the transactions contemplated
thereby have been duly authorized by the Company and each of the Guarantors;
when the Registration Rights Agreement is duly executed by the proper officers
of the Company and delivered by the Company and each of the Guarantors (assuming
that the Registration Rights Agreement is the valid and binding obligation of
the Initial Purchasers), it will be a valid and binding agreement of the Company
and each of the Guarantors enforceable against the Company and each of the
Guarantors in accordance with its terms, except as the enforceability thereof
may be limited by bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium and other similar laws relating to or affecting creditors' rights
generally, subject to general principles of equity and to limitations on
availability of equitable relief, including specific performance (whether
considered in a proceeding in equity or at law) and an implied covenant of good
faith and fair dealing, and except with respect to the rights of indemnification
and contribution thereunder, where enforcement thereof may be limited by federal
or state securities laws or the policies underlying such laws; and the
Registration Rights Agreement will conform in all material respects to the
description thereof contained in the Offering Memorandum;
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(l) The Company has all requisite power and authority to execute,
issue and deliver the CODES and perform its obligations thereunder; the CODES
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 CODES by the Trustee, upon delivery to the Initial
Purchasers against payment therefor in accordance with the terms hereof, will
constitute valid and binding obligations of the Company entitled to the benefits
of the Indenture and enforceable 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) or an implied covenant of good faith and fair dealing; and the
CODES, when issued and delivered, will conform in all material respects to the
description thereof contained in the Offering Memorandum;
(m) The Guarantees have been duly and validly authorized by the
Guarantors and when duly endorsed on the CODES in accordance with the terms of
the Indenture and, assuming due authentication of the CODES by the Trustee, upon
delivery to the Initial Purchasers against payment therefor in accordance with
the terms hereof, will constitute valid and binding obligations of each of the
Guarantors entitled to the benefits of the Indenture and enforceable against
each of the Guarantors 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 principals (whether considered in a proceeding in equity or at law) or
an implied covenant of good faith and fair dealing;
(n) Except (1) as described in the Offering Memorandum (or in the
documents incorporated therein by reference), (2) as described in the offering
memorandum, dated July 27, 2005, pursuant to which L-3 Communications
Corporation is offering $1.0 billion of its Senior Subordinated Notes due 2015
and (3) as provided in the Registration Rights Agreement dated the First
Delivery Date, there are no contracts, agreements or understandings between the
Company and any person granting such person the right (other than rights which
have been waived or satisfied or rights not exercisable in connection with the
Offering Memorandum) 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 any securities being registered pursuant to any registration statement filed
by the Company under the Securities Act;
(o) Except as described in the Offering Memorandum, the Company and
the Guarantors have not sold or issued any Securities with terms that are
substantially similar to the CODES and the Guarantees during the six-month
period preceding the date of the Offering Memorandum, including any sales
pursuant to Rule 144A (as defined below) under, or Regulations D of, the
Securities Act other than shares issued pursuant to employee benefit plans,
qualified stock option plans or other employee compensation plans or pursuant to
outstanding options, rights or warrants;
(p) Neither the Company nor any of its subsidiaries has incurred,
since the date of the latest audited financial statements included or
incorporated by reference in the Offering Memorandum, any liability or
obligation, direct or contingent, or entered into any
6
transaction, in each case not in the ordinary course of business, that is
material to the Company and its subsidiaries taken as a whole, otherwise than as
set forth, incorporated by reference or contemplated in the Offering Memorandum;
and, since such date, 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 of its subsidiaries or any material adverse change, or any development
involving or which would reasonably be expected to involve a Material Adverse
Effect, otherwise than as described, incorporated by reference or contemplated
in the Offering Memorandum;
(q) The historical and pro forma financial statements, together with
the related CODES, set forth or incorporated by reference in the Offering
Memorandum comply as to form in all material respects with the requirements of
Regulation S-X under the Securities Act, except with respect to certain
information regarding the Guarantors and non-Guarantors. The historical
consolidated financial statements of the Company fairly present the financial
condition and results of operations and cash flows of the entities purported to
be shown thereby, at the dates and for the periods indicated, and have been
prepared in conformity with generally accepted accounting principles applied on
a consistent basis throughout the periods involved; Such pro forma financial
statements have been prepared on a basis consistent with such historical
statements of the Company, 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, historical
and pro forma, have been derived from the financial records of the Company (or
its predecessors) 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.
(r) PricewaterhouseCoopers LLP, who have certified certain financial
statements of the Company, whose report is incorporated by reference in the
Offering Memorandum and who have delivered the initial letter referred to in
Section 5(g) hereof, are independent public accountants as required by the
Securities Act and the Exchange Act (as defined below) and the Rules and
Regulations promulgated thereunder during the periods covered by the financial
statements on which they reported incorporated in the Offering Memorandum;
(s) KPMG LLP, who have certified certain financial statements of The
Titan Corporation, whose report is incorporated by reference in the Offering
Memorandum and who have delivered the initial letter referred to in Section 5(g)
hereof, are, to our knowledge, independent public accountants as required by the
Securities Act and the Exchange Act (as defined below) and the Rules and
Regulations promulgated thereunder during the periods covered by the financial
statements on which they reported incorporated in the Offering Memorandum;
(t) The Company and each of its subsidiaries have good and marketable
title to all property (real and personal) described in the Offering Memorandum
as being owned by them, 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
7
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 and its
subsidiaries is held by them under valid, subsisting and enforceable leases,
with only such exceptions as would not have a Material Adverse Effect
(individually or in the aggregate);
(u) The Company and each of its subsidiaries own or possess adequate
rights to use 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 them or necessary for the conduct of their
business, except as such would not have a Material Adverse Effect (individually
or in the aggregate), 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 and its subsidiaries with respect to the foregoing
which, if determined adversely to the Company and its subsidiaries, would have a
Material Adverse Effect (individually or in the aggregate);
(v) Except as described in the Offering Memorandum, there are no legal
or governmental proceedings pending or, to the knowledge of the Company,
threatened, against the Company or any of its subsidiaries or to which the
Company or any of its subsidiaries is a party or of which any property or assets
of the Company or any of its subsidiaries is the subject which, if determined
adversely to the Company or any of its subsidiaries, are reasonably likely to
cause a Material Adverse Effect;
(w) 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 or
incorporated by reference in the Offering Memorandum;
(x) 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;
(y) Except as disclosed or incorporated by reference in the Offering
Memorandum, 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"); no "reportable event" (as defined in ERISA) has occurred
with respect to any "pension plan" (as defined in ERISA) subject to Title IV of
ERISA for which the Company would have any material liability; the Company has
not incurred and does not expect to incur any material liability under (i) Title
IV of ERISA with respect to termination of, or withdrawal from, any such
"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 such "pension plan" for which the Company would have
any liability that is intended to be qualified under Section 401(a) of the Code
is 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;
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(z) The Company and its subsidiaries have filed all federal, state and
local income and franchise tax returns required to be filed through the date
hereof and have paid all taxes due thereon, and no tax deficiency has been
determined adversely to the Company or any of its subsidiaries nor does the
Company have any knowledge of any tax deficiency which, if determined adversely
to the Company and its subsidiaries, might have a Material Adverse Effect;
(aa) Neither the Company nor any of its subsidiaries (i) is in
violation of its charter or by-laws or other organizational documents, (ii) is
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
Material Agreement or (iii) is in violation in any material respect of any law,
ordinance, governmental rule, regulation or court decree to which it or its
property or assets may be 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 in the case of clauses (ii) and (iii) as would not, individually or in
the aggregate, have a Material Adverse Effect;
(bb) To the best of the Company's knowledge, neither the Company nor
any of its subsidiaries, nor any director, officer, agent, employee or other
person associated with or acting on behalf of the Company or any of its
subsidiaries, 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 as such that
would not have a Material Adverse Effect or as is disclosed in the Offering
Memorandum or in the documents incorporated therein by reference;
(cc) 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 any of its
subsidiaries (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 or its subsidiaries 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 any of its subsidiaries 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;
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(dd) Neither the Company nor any subsidiary is, and upon the sale of
the CODES to be issued and sold 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 such term under the United States Investment
Company Act of 1940 and the rules and regulations of the Commission thereunder;
(ee) When the CODES are issued and delivered pursuant to this
Agreement, such CODES will not be of the same class (within the meaning of Rule
144A under the Securities 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;
(ff) Neither the Company nor any of its affiliates (as defined in Rule
501(b) of Regulation D under the Securities Act ("Regulation D")) (other than
the Initial Purchasers, about which no representations are made by the Company)
has, directly or through an agent, engaged in any form of general solicitation
or general advertising in connection with the offering of the CODES (as those
terms are used in Regulation D) under the Securities Act or in any manner
involving a public offering within the meaning of Section 4(2) of the Securities
Act; the Company has not entered into any contractual arrangement with respect
to the distribution of the CODES except for the Operative Documents and the
Company will not enter into any such arrangement;
(gg) Neither the Company nor any of its affiliates (other than the
Initial Purchasers, about which no representations are made by the Company),
has, directly or through any agent, sold, offered for sale, solicited offers to
buy or otherwise negotiated in respect of, any "security" (as defined in the
Securities Act) which is or will be integrated with the sale of the CODES in a
manner that would require the registration under the Securities Act of the
CODES;
(hh) The Company has not taken, directly or indirectly, any action
designed to cause or result in, or which has constituted or which might
reasonably be expected to constitute, the stabilization or manipulation of the
price of any security of the Company in connection with the offering of the
CODES;
(ii) There are no contracts or other documents which would be required
to be described in a prospectus contained in a registration statement on Form
S-3 by the Securities Act or by the rules and regulations thereunder which have
not been described in the Offering Memorandum or in the documents incorporated
therein by reference;
(jj) Except as permitted by the Securities Act, the Company has not
distributed and, prior to the later to occur of the First Delivery Date and
completion of the distribution of the CODES, will not distribute any offering
material in connection with the offering and sale of the CODES other than the
Preliminary Offering Memorandum and the Offering Memorandum;
(kk) Assuming (i) that your representations and warranties in Section
7 are true, (ii) compliance by you with your covenants set forth in Section 7
and (iii) that each of the
10
Eligible Purchasers (as defined in Section 7) is a QIB, the purchase of the
CODES by you pursuant hereto and the initial resale of the CODES pursuant hereto
is exempt from the registration requirements of the Securities Act;
(ll) The Company is a "reporting issuer" as defined in Rule 902 under
the Securities Act;
(mm) The Company has established and maintains disclosure controls and
procedures (as such term is defined in Rule 13a-14 under the Exchange Act),
which (i) are designed to ensure that material information relating to the
Company, including its consolidated subsidiaries, is made known to the Company's
principal executive officer and its principal financial officer by others within
those entities, particularly during the periods in which the periodic reports
required under the Exchange Act are being prepared; (ii) have been evaluated for
effectiveness as of the end of the period covered by the Company's most recent
annual or quarterly report filed with the Commission; and (iii) are effective in
all material respects to perform the functions for which they were established;
(nn) Based on the evaluation of its disclosure controls and
procedures, the Company is not aware of (i) any significant deficiency in the
design or operation of internal controls over financial reporting which could
adversely affect the Company's ability to record, process, summarize and report
financial data or any material weaknesses in internal controls or (ii) any
fraud, whether or not material, that involves management or other employees who
have a significant role in the Company's internal controls over financial
reporting;
(oo) Since the date of the most recent evaluation of such disclosure
controls and procedures, there have been no significant changes in internal
controls or in other factors that could significantly affect internal controls,
including any corrective actions with regard to significant deficiencies and
material weaknesses; and
(pp) Except for the documents currently on file with the Securities
and Exchange Commission as "material contracts" within the meaning of Item 601
of Regulation S-K under the Securities Act of 1933, as amended, there are no
agreements of the Company that would be required to be filed as "material
contracts" pursuant to such Item 601.
2. Purchase, Sale and Delivery of the CODES.
(a) The Company and the Guarantors hereby agree, on the basis of the
representations, warranties and agreements of the Initial Purchasers contained
herein and subject to all the terms and conditions set forth herein, to issue
and sell to the Initial Purchasers and, upon the basis of the representations,
warranties and agreements of the Company and the Guarantors herein contained and
subject to all the terms and conditions set forth herein, each Initial Purchaser
agrees, severally and not jointly, to purchase from the Company, at a purchase
price of 97.5% of the principal amount thereof, the principal amount of CODES
set forth opposite such Initial Purchaser's name in Schedule I hereto. The
Company and the Guarantors shall not be obligated to deliver any of the
securities to be delivered hereunder except upon payment for all of the
securities to be purchased as provided herein.
11
Delivery of and payment for the Firm CODES shall be made at the office
of Xxxxxxx Xxxxxxx & Xxxxxxxx LLP, 000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000, at 10:00 a.m. (New York time) on July 29, 2005, or such later date as the
Initial Purchasers shall designate, which date and time may be postponed by
agreement between the Initial Purchasers and the Company or as provided in
Section 9 (such date and time of delivery and payment for the Firm CODES being
herein called the "First Delivery Date"). Delivery of the Firm CODES shall be
made to the Initial Purchasers against payment of the purchase price by the
Initial Purchasers. Payment for the Firm CODES shall be effected either by wire
transfer of immediately available funds to an account with a bank in The City of
New York, the account number and the ABA number for such bank to be provided by
the Company to the Initial Purchasers at least two business days in advance of
the First Delivery Date, or by such other manner of payment as may be agreed by
the Company and the Initial Purchasers.
(b) Subject to the terms and conditions and in reliance upon the
representations and warranties herein set forth, the Company hereby grants the
Option to the Initial Purchasers to purchase, severally and not jointly, the
Optional CODES at the same price as the Initial Purchasers shall pay for the
Firm CODES and the principal amount of the Optional CODES to be sold to each
Initial Purchaser shall be that principal amount which bears the same ratio to
the aggregate principal amount of Optional CODES being purchased as the
principal amount of Firm CODES set forth opposite the name of such Initial
Purchaser in Schedule I hereto (or such number as increased as set forth in
Section 8). The Option may be exercised once in whole or in part at any time not
more than 13 days subsequent to the date of this Agreement upon notice in
writing or by facsimile by the Initial Purchasers to the Company setting forth
the amount (which shall be an integral multiple of $1,000) of Optional CODES as
to which the Initial Purchasers are exercising the Option. The purchase of the
Optional CODES must close on or before August 11, 2005.
The date for the delivery of and payment for the Optional CODES, being
herein referred to as an "Optional Delivery Date," which may be the First
Delivery Date (the First Delivery Date and the Optional Delivery Date, if any,
being sometimes referred to as a "Delivery Date"), shall be determined by the
Initial Purchasers but shall not be later than thirteen days subsequent to the
First Delivery Date. Delivery of the Optional CODES shall be made to the Initial
Purchasers against payment of the purchase price by the Initial Purchasers.
Payment for the Optional CODES shall be effected either by wire transfer of
immediately available funds to an account with a bank in the City of New York,
the account number and the ABA number for such bank to be provided by the
Company to the Initial Purchasers at least two business days in advance of the
Optional Delivery Date, or by such other manner of payment as may be agreed by
the Company and the Initial Purchasers.
(c) The Company will deliver against payment of the purchase price the
CODES initially sold to qualified institutional buyers ("QIBs"), as defined in
Rule 144A under the Securities Act ("Rule 144A") in the form of one or more
permanent global certificates (the "Global CODES"), registered in the name of
Cede & Co., as nominee for The Depository Trust Company ("DTC"). Beneficial
interests in the CODES initially sold to QIBs will be shown on, and transfers
thereof will be effected only through, records maintained in book-entry form by
DTC and its participants.
12
The Global CODES will be made available, at the request of the Initial
Purchasers, for inspection at least 24 hours prior to such Delivery Date. The
Certificated CODES will be made available, at the request of the Initial
Purchasers, for checking at least 48 hours prior to such Delivery Date.
(d) Time shall be of the essence, and delivery at the time and place
specified pursuant to this Agreement is a further condition of the obligations
of the Initial Purchasers hereunder.
3. Further Agreements of the Company. The Company agrees with the
Initial Purchasers as follows:
(a) To advise the Initial Purchasers promptly of any proposal to amend
or supplement the Offering Memorandum and not to effect any such amendment or
supplement without the consent of the Initial Purchasers. If, at any time prior
to completion of the resale of the CODES by the Initial Purchasers, any event
shall occur or condition exist as a result of which it is necessary to amend or
supplement the Offering Memorandum in order that the Offering Memorandum will
not include an untrue statement of a material fact or omit to state a material
fact necessary in order to make the statements therein, in the light of the
circumstances existing at the time it is delivered to a purchaser, not
misleading, to promptly notify the Initial Purchaser and prepare, subject to the
first sentence of this Section 3(a), such amendment or supplement as may be
necessary to correct such untrue statement or omission;
(b) To furnish to the Initial Purchasers and to Xxxxxx & Xxxxxxx,
counsel to the Initial Purchasers, copies of the Offering Memorandum and the
Offering Memorandum (and all amendments and supplements thereto) in each case as
soon as available and in such quantities as the Initial Purchasers reasonably
request for internal use and for distribution to prospective purchasers. The
Company will pay the expenses of printing and distributing to the Initial
Purchasers all such documents;
(c) To use its reasonable efforts to take such action as the Initial
Purchasers may reasonably request from time to time, to qualify the CODES for
offering and sale under the securities laws of such jurisdictions as the Initial
Purchasers may request and to comply with such laws so as to permit the
continuance of sales and dealings therein in such jurisdictions in the United
States for as long as may be necessary to complete the resale of the CODES;
provided, however, that in connection therewith, the Company shall not be
required to qualify as a foreign corporation or otherwise subject itself to
taxation in any jurisdiction in which it is not otherwise so qualified or
subject;
(d) To apply the proceeds from the sale of the CODES as set forth
under "Use of Proceeds" in the Offering Memorandum;
(e) For a period of 90 days from the date of the Offering Memorandum
(the "Lock-Up Period"), not to directly or indirectly, (1) offer, pledge,
announce the intention to sell, sell, contract to sell, sell any option or
contract to purchase, purchase any option or contract to sell, grant any option,
right or warrant to purchase, or otherwise transfer or dispose of, directly or
indirectly, any shares of Common Stock, or any securities convertible into or
exercisable or
13
exchangeable for Common Stock, (2) enter into any swap or other agreement that
transfers, in whole or in part, any of the economic consequences of ownership of
the Common Stock, whether any such transaction described in clause (1) or (2)
above is to be settled by delivery of Common Stock or such other securities, in
cash or otherwise, (3) cause to be filed a registration statement with respect
to the registration of any shares of Common Stock or securities convertible,
exercisable or exchangeable into Common Stock or any other securities of the
Company or (4) publicly disclose the intention to do any of the foregoing.
Notwithstanding the foregoing, the Company shall be permitted to (1) cause
to be filed one or more registration statements with respect to any registration
rights agreements to which the Company is a party outstanding on the date
hereof, (2) make the filing contemplated by the Registration Rights Agreement,
(3) issue shares of Common Stock upon the exercise of options or warrants
outstanding on the date hereof under the Company's employee benefit plans,
qualified stock option plans or other employee compensation plans, (4) issue
shares upon the conversion or exchange of convertible or exchangeable
securities, including the Conversion Shares, (5) grant options, warrants or
other equity awards under the Company's stock option or other employee
compensation plans existing on the date hereof and (6) issue securities in
exchange for the assets of, or a majority or controlling portion of the equity
of, another entity in connection with the acquisition by the Company of such
entity.
(f) For so long as any of the CODES are "restricted securities" within
the meaning of Rule 144(a)(3) under the Securities Act, to provide to any holder
of the CODES or to any prospective purchaser of the CODES designated by any
holder, upon request of such holder or prospective purchaser, information
required to be provided by Rule 144A(d)(4) of the Securities Act if, at the time
of such request, the Company is not subject to the reporting requirements under
Section 13 or 15(d) of the Exchange Act;
(g) Each of the CODES will bear, to the extent applicable, the legend
contained in "Notice to Investors" in the Offering Memorandum for the time
period and upon the other terms stated therein, except after the CODES are
resold pursuant to a registration statement effective under the Securities Act;
(h) To take such steps as shall be necessary to ensure that neither
the Company nor any subsidiary shall become an "investment company" within the
meaning of such term under the United States Investment Company Act of 1940, and
the rules and regulations of the Commission thereunder;
(i) To execute and deliver the Registration Rights Agreement (in form
and substance satisfactory to the Initial Purchasers);
(j) To use its best efforts to assist the Initial Purchasers in
arranging to cause the CODES to be accepted to trade in the PORTAL market
("PORTAL") of the National Association of Securities Dealers, Inc. ("NASD");
(k) To use its best efforts to cause the CODES to be accepted for
clearance and settlement through the facilities of DTC; and
14
(l) To use its best efforts to have the Conversion Shares approved by
the New York Stock Exchange ("NYSE") for inclusion prior to the effectiveness of
the Registration Statement.
4. Expenses. The Company agrees to pay:
(a) the costs incident to the authorization, issuance, sale and
delivery of the CODES, and any taxes payable in that connection;
(b) the costs incident to the preparation, printing and distribution
of the Offering Memorandum and any amendment or supplement to the Offering
Memorandum, as provided in this Agreement;
(c) the costs of delivering and distributing the Operative Documents;
(d) the fees and expenses of Xxxxxxx Xxxxxxx & Xxxxxxxx LLP and
PricewaterhouseCoopers, LLP;
(e) the costs of distributing the terms of agreement relating to the
organization of the underwriting syndicate and selling group to the members
thereof by mail, telex or other means of communication;
(f) the fees and expenses of qualifying the CODES under the securities
laws of the several jurisdictions as provided in Section 3(c) and of
preparing, printing and distributing a Blue Sky Memorandum (including
reasonable related fees and expenses of counsel to the Initial Purchasers);
(g) all other costs and expenses incident to (i) the preparation of
the Company's "net road show" presentation materials and (ii) the road show
travelling expenses of the Company, if any;
(h) all fees and expenses incurred in connection with any rating of
the CODES;
(i) the costs of preparing the CODES;
(j) all expenses and fees in connection with the application for
inclusion of the CODES in the PORTAL market and the inclusion of the
Conversion Shares on the NYSE; and
(k) all other costs and expenses incident to the performance of the
obligations of the Company and the Guarantors under this Agreement;
provided that, except as provided in this Section 4 and in Section 8, the
Initial Purchasers shall pay their own costs and expenses, including the costs
and expenses of their counsel and any transfer taxes on the CODES which they may
sell.
15
5. Conditions of the Initial Purchasers' Obligations. The several
obligations of the Initial Purchasers hereunder are subject to the accuracy,
when made and on each Delivery Date, of the representations and warranties of
the Company and the Guarantors contained herein, to the performance by the
Company and the Guarantors 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 prior to or on such Delivery Date that the Offering Memorandum or any
amendment or supplement thereto contains any untrue statement of a fact which,
in the opinion of Xxxxxx & Xxxxxxx LLP, is material or omits to state any fact
which is material and necessary to make the statements therein, in 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 the Operative Documents and the Offering
Memorandum or any amendment or supplement thereto, and all other legal matters
relating to the Operative Documents and the transactions contemplated thereby
shall be satisfactory in all material respects to counsel to the Initial
Purchasers, and the Company shall have furnished to such counsel all documents
and information that they may reasonably request to enable them to pass upon
such matters;
(c) Xxxxxxx Xxxxxxx & Xxxxxxxx LLP shall have furnished to the Initial
Purchasers its written opinion, as counsel to the Company, addressed to the
Initial Purchasers and dated such Delivery Date, substantially in the form
attached hereto as Exhibit A-1, and its negative assurance letter substantially
in the form attached hereto as Exhibit A-2.
(d) Xxxxxxxxxxx X. Xxxxxxx, General Counsel of the Company, shall have
furnished to the Initial Purchasers his written opinion, as General Counsel to
the Company, addressed to the Initial Purchasers and dated such Delivery Date in
the form attached hereto as Exhibit B.
(e) The Initial Purchasers shall have received from Xxxxxx & Xxxxxxx
LLP, counsel for the Initial Purchasers, such opinion or opinions, dated the
Delivery Date, with respect to the issuance and sale of the CODES and
Guarantees, the Offering Memorandum and other related matters as the Initial
Purchasers may reasonably request, and the Company shall have furnished to such
counsel such documents as they reasonably require for the purpose of enabling
them to pass upon such matters;
(f) At the time of the First Delivery Date, the Initial Purchasers
shall have received from each of PricewaterhouseCoopers, LLP and KPMG LLP a
letter, in form and substance satisfactory to the Initial Purchasers, addressed
to the Initial Purchasers and dated the date hereof (i) confirming that they are
independent public accountants within the meaning of the Securities Act and
under Rule 101 of AICPA's Code of Professional Conduct and are in compliance
with the applicable requirements relating to the qualification of accountants
under Rule 2-01 of Regulation S-X of the Commission and (ii) stating, as of the
date hereof (or, with respect to matters involving changes or developments since
the respective dates as of which specified financial information is given in the
Offering Memorandum, as of a date not more than
16
five days prior to the date hereof), the conclusions and findings of such firm
with respect to the financial information and other matters ordinarily covered
by accountants' "comfort letters" to underwriters in connection with registered
public offerings;
(g) With respect to the letters of PricewaterhouseCoopers, LLP and
KPMG LLP referred to in the preceding paragraph and delivered to the Initial
Purchasers (the "initial letter"), on any subsequent Optional Delivery Date, the
Company shall have furnished to the Initial Purchasers a letter (the "bring-down
letter") of such accountants, in form and substance satisfactory to the Initial
Purchasers and dated such Delivery Date (i) confirming that they are independent
public accountants within the meaning of the Securities Act and Code of
Professional Conduct are in compliance with the applicable requirements relating
to the qualification of accountants under Rule 2-01 of Regulation S-X of the
Commission, (ii) stating, as of the date of the bring-down letter (or, with
respect to matters involving changes or developments since the respective dates
as of which specified financial information is given in the Offering Memorandum,
as of a date not more than five days prior to the date of the bring-down
letter), the conclusions and findings of such firm with respect to the financial
information and other matters covered by the initial letter and (iii) confirming
in all material respects the conclusions and findings set forth in the initial
letter;
(h) The Company and the Guarantors shall have furnished to the Initial
Purchasers a certificate, dated such Delivery Date and delivered on behalf of
the Company or the Guarantors as the case may be, of their respective Chairman
of the Board, their respective President or a Vice President and their
respective chief financial officer, in form and substance satisfactory to the
Initial Purchasers stating that:
(i) The representations, warranties and agreements of the Company
and the Guarantors in Section 1 are true and correct as of the date given
and as of such Delivery Date; and the Company and the Guarantors have
complied with all their agreements contained herein to be performed prior
to or on such Delivery Date; and
(ii) They have carefully examined the Offering Memorandum and, in
their opinion (A) the Offering Memorandum as of its date and as of the
Closing Date did not include any untrue statement of a material fact and
did not omit to state any material fact necessary to make the statements
therein, in light of the circumstances under which they were made, 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.
(i) 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) of the
Rules and Regulations 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;
17
(j) The Indenture shall have been duly executed and delivered by the
Company and the Trustee and the CODES shall have been duly executed and
delivered by the Company and duly authenticated by the Trustee;
(k) The Company, the Guarantors and the Initial Purchasers shall have
executed and delivered the Registration Rights Agreement (in form and substance
satisfactory to the Initial Purchasers) and the Registration Rights Agreement
shall be in full force and effect;
(l) The NASD shall have accepted the CODES for trading on PORTAL;
(m)(i) Neither the Company nor any of its subsidiaries shall have
sustained since the date of the latest audited financial statements included in
the Offering Memorandum any 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, except (A)
as set forth or incorporated by reference or contemplated in the Offering
Memorandum and (B) for operating losses incurred in the ordinary course of
business, or (ii) since such date there shall not have been any change in the
capital stock or long-term debt of the Company and its subsidiaries (except for
issuances of shares of Common Stock upon exercise of outstanding options
described or incorporated by reference in the Offering Memorandum or pursuant to
Authorized Grants), or any change, or any development involving a prospective
change, in or affecting the general affairs, management, financial position,
stockholders' equity or results of operations of the Company and its
subsidiaries, except as set forth or incorporated by reference or contemplated
in the Offering Memorandum, the effect of which, in any such case described in
clause (i) or (ii), is, in the reasonable judgment of the Initial Purchasers, so
material and adverse as to make it impracticable or inadvisable to proceed with
the sale or the delivery of the CODES and the Guarantees being delivered on such
Delivery Date on the terms and in the manner contemplated in the Offering
Memorandum;
(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 NYSE, the American
Stock Exchange, the NASDAQ National Market or 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
materially limited or the settlement of such trading generally shall
have been materially disrupted or minimum prices shall have been
established on any such exchange or 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 of the United States or there shall have occurred
any other calamity or crisis (including, without limitation, as a
result of terrorist activities);
(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
18
or there shall have occurred any other calamity or crisis (including,
without limitation, as a result of terrorist activities); or
(iv) there shall have occurred such a material adverse change in
general domestic or international economic, political or financial
conditions, including without limitation as a result of terrorist
activities after the date hereof, or the effect of international
conditions on the financial markets in the United States shall be
such, as to make it in the case of (iii) or (iv), in the sole judgment
of a majority in interest of the Representatives, impracticable or
inadvisable to proceed with the offering or delivery of the CODES
being delivered on such Delivery Date on the terms and in the manner
contemplated in the Offering Memorandum.
(o) On or prior to the First Delivery Date, The Depositary Trust
Company shall have accepted the CODES for clearance.
(p) 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
Securities 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.
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 satisfactory to counsel
to the Initial Purchasers.
6. No fiduciary duty. The Company acknowledges and agrees that in
connection with this offering and sale of the CODES or any other services the
Initial Purchasers may be deemed to be providing hereunder, notwithstanding any
preexisting relationship, advisory or otherwise, between the parties or any oral
representations or assurances previously or subsequently made by the Initial
Purchasers: (i) no fiduciary or agency relationship between the Company and any
other person, on the one hand, and the Initial Purchasers, on the other, exists;
(ii) the Initial Purchasers are not acting as advisors, expert or otherwise, to
the Company and such relationship between the Company, on the one hand, and the
Initial Purchasers, on the other, is entirely and solely commercial, based on
arms-length negotiations; (iii) any duties and obligations that the Initial
Purchasers may have to the Company shall be limited to those duties and
obligations specifically stated herein; and (iv) the Initial Purchasers and
their respective affiliates may have interests that differ from those of the
Company. The Company hereby waives any claims that the Company may have against
the Initial Purchasers with respect to any breach of fiduciary duty in
connection with the Offering.
7. Representations, Warranties and Agreements of the Initial
Purchasers. Each Initial Purchaser represents and warrants that it is a QIB and
is not acquiring the CODES with a view to any distribution thereof or with any
present intention of offering or selling any of the CODES in a transaction that
would violate the Securities Act or the securities laws of any State
19
of the United States or any applicable jurisdiction. In connection with the sale
of the CODES by the Initial Purchaser, each Initial Purchaser will solicit
offers to buy the CODES only from, and will offer to sell the CODES only to, the
"Eligible Purchasers" (defined as persons whom the Initial Purchaser reasonably
believes are "qualified institutional buyers" as defined in Rule 144A under the
Securities Act) in accordance with this Agreement and on the terms contemplated
by the Offering Memorandum. Each Initial Purchaser, severely and not jointly,
agrees with the Company that:
(a) The CODES and the Conversion Shares have not been and will not be
registered under the Securities Act in connection with the initial offering of
the CODES.
(b) Such Initial Purchaser is purchasing the CODES pursuant to a
private sale exemption from registration under the Securities Act.
(c) The CODES have not been and will not be offered or sold by such
Initial Purchaser or its affiliates acting on its behalf within the United
States or to, or for the account or benefit of United States persons, except in
accordance with Rule 144A.
(d) Such Initial Purchaser will not offer or sell the CODES in the
United States by means of any form of general solicitation or general
advertising within the meaning of Rule 502(c) of Regulation D, including (i) any
advertisement, article, notice or other communication published in any
newspaper, magazine or similar medium or broadcast over television or radio, or
(ii) any seminar or meeting whose attendees have been invited by any general
solicitation or general advertising in the United States.
(e) The CODES have not been and will not be registered under the
Securities Act and may not be offered or sold except in accordance with an
exemption from the registration requirements of the Securities Act. Such Initial
Purchaser represents that it has been offered, sold or delivered the CODES, and
will not offer, sell or deliver the CODES as a part of its distribution at any
time except in accordance with Rule 144A under the Securities Act.
(f) 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 CODES, except with its affiliates or with the prior written
consent of the Company.
(g) Such Initial Purchaser further represents and agrees that (i) it
has not offered or sold and will not offer or sell any CODES to persons in the
United Kingdom prior to the expiration of the period of six months from the
issue date of the CODES, except to persons whose ordinary activities involve
them in acquiring, holding, managing or disposing of investments (as principal
or agent) for the purpose of their businesses or otherwise in circumstances 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
and each of its affiliates have only communicated or caused to be communicated
and will only communicate or cause to be communicated any invitation or
inducement to engage in investment activity (within the meaning of Section 21 of
the Financial Services and Markets Act 2000 (the "FSMA") received by it in
connection with the issue or sale of any CODES in circumstances in which Section
21(1) of the FSMA does not apply to the Company; and (iii) it and each of its
20
affiliates have complied and will comply with all applicable provisions of the
FSMA with respect to anything done by it in relation to the CODES in, from or
otherwise involving the United Kingdom.
(h) Such Initial Purchaser agrees not to cause any advertisement of
the CODES to be published in any newspaper or periodical or posted in any public
place and not to issue any circular relating to the CODES.
(i) Such Initial Purchaser understands that the Company and, for
purposes of the opinions to be delivered to you pursuant to Section 5 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 such Initial Purchaser hereby consents to such reliance.
Each Initial Purchaser further agrees that, in connection with the
sale of the CODES by such Initial Purchaser, it will solicit offers to buy the
CODES only from, and will offer to sell the CODES only to Eligible Purchasers.
8. Indemnification and Contribution.
(a) The Company and the Guarantors shall jointly and severally
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 CODES and Guarantees), 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 the Preliminary Offering Memorandum, 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 the Preliminary Offering Memorandum, 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 CODES 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 and the Guarantors 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
21
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 and the Guarantors 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 or incorporated by reference in the
Preliminary Offering Memorandum, 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; and provided further, that the foregoing indemnity agreement
with respect to any Preliminary Offering Memorandum shall not inure to the
benefit of any Initial Purchasers who it shall be established failed to deliver
the Offering Memorandum to the person asserting any losses, claims, damages,
liabilities and judgments caused by any untrue statement or alleged untrue
statement of a material fact or an omission or alleged omission to state a
material fact required to be stated in such Preliminary Offering Memorandum or
necessary to make the statements in such Preliminary Offering Memorandum not
misleading, if (A) the Company shall have furnished copies of the Offering
Memorandum to the several Initial Purchasers in the requisite quantity and
sufficiently on a timely basis to permit proper delivery of the Offering
Memorandum to such person; (B) such misstatement or omission or alleged
misstatement or omission was cured in the Offering Memorandum and the Offering
Memorandum was required by law to be delivered to such person at or prior to the
written confirmation of the sale of the CODES to such person and (C) the timely
delivery of the Offering Memorandum to such person would have constituted a
valid defense to the losses, claims, damages, liabilities and judgments asserted
by such person. The foregoing indemnity agreement is in addition to any
liability which the Company or the Guarantors 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, the Guarantors, their officers and employees,
each of their directors and each person, if any, who controls the Company and
the Guarantors 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, the Guarantors 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 or incorporated by reference (A) in the Preliminary Offering
Memorandum, 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, or incorporated by reference in, the Preliminary Offering Memorandum,
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, the Guarantors and any such director, officer or
controlling person for any legal or other expenses reasonably incurred by the
Company, such Guarantor or any such director, officer or controlling person in
connection with investigating or defending or preparing to defend against any
such
22
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, the Guarantors 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 the 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 judgment 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, the indemnifying party shall not have the
right to assume the defense of such action on behalf of such indemnified party,
it being understood, however, that 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 8 consist of the Company, the Guarantors or any of the Company's or the
Guarantors' directors, officers, employees or controlling persons. 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,
23
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) or 8(b) 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 and the Guarantors on the one hand and the Initial
Purchasers on the other from the offering of the CODES and Guarantees 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 and
the Guarantors, 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 and the
Guarantors, 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 CODES purchased under this Agreement (before
deducting expenses) received by the Company and the Guarantors, on the one hand,
and the total underwriting discounts and commissions received by the Initial
Purchasers with respect to the shares of the CODES and Guarantees purchased
under this Agreement, on the other hand, bear to the total gross proceeds from
the offering of the CODES 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, and the Guarantors 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, the Guarantors and the Initial Purchasers agree that it would not
be just and equitable if contributions pursuant to this Section 8 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 8 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 CODES purchased by it 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
24
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 and the
Guarantors acknowledge that the statements with respect to the offering of the
CODES by the Initial Purchasers and the third, fifth, sixth, seventh, first
sentence of the eighth, ninth, second sentence of the tenth and fifteenth
paragraphs under the caption "Plan of Distribution" in the Offering Memorandum
are correct and constitute the only information concerning the Initial
Purchasers furnished in writing to the Company by or on behalf of the Initial
Purchasers specifically for inclusion in the Offering Memorandum.
9. Defaulting Initial Purchasers.
If, on the First Delivery Date or Optional Delivery Date, as the case
may be, any Initial Purchaser defaults in the performance of its obligations
under this Agreement, the remaining non-defaulting Initial Purchasers shall be
obligated to purchase the aggregate principal amount of the Firm CODES or
Optional CODES, as the case may be, which the defaulting Initial Purchaser
agreed but failed to purchase on the First Delivery Date or Optional Delivery
Date, as the case may be, in the respective proportions which the total
aggregate principal amount of the Firm CODES or Optional CODES, as the case may
be, set opposite the name of each remaining non-defaulting Initial Purchaser in
Schedule 1 hereto bears to the total aggregate principal amount of Notes set
opposite the names of all the remaining non-defaulting Initial Purchasers in
Schedule 1 hereto; provided, however, that the remaining non-defaulting Initial
Purchasers shall not be obligated to purchase any Firm CODES or Optional CODES,
as the case may be, on the First Delivery Date or Optional Delivery Date, as the
case may be, if the total aggregate principal amount of the Firm CODES or
Optional CODES, as the case may be, which the defaulting Initial Purchasers
agreed but failed to purchase on such date exceeds 9.09% of the total aggregate
principal amount at maturity of the Firm CODES or Optional CODES, as the case
may be, to be purchased on the First Delivery Date or Optional Delivery Date, as
the case may be, and any remaining non-defaulting Initial Purchaser shall not be
obligated to purchase more than 110% of the aggregate principal amount at
maturity of the Firm CODES or Optional CODES, as the case may be, which it
agreed to purchase on the First Delivery Date or Optional Delivery Date, as the
case may be, pursuant to the terms of Section 2. If the foregoing maximums are
exceeded, the remaining non-defaulting Initial Purchasers, or those other
underwriters satisfactory to the Initial Purchasers who so agree, shall have the
right, but shall not be obligated, to purchase on the First Delivery Date or
Optional Delivery Date, as the case may be, in such proportion as may be agreed
upon among them, the total aggregate principal amount of the Firm CODES or
Optional CODES, as the case may be, to be purchased on the First Delivery Date
or Optional Delivery Date, as the case may be. If the remaining Initial
Purchasers or other underwriters satisfactory to the Initial Purchasers do not
elect to purchase on the First Delivery Date or Optional Delivery Date, as the
case may be, the aggregate principal amount of the Firm CODES or Optional CODES,
as the case may be, which the defaulting Initial Purchasers agreed but failed to
purchase, this Agreement shall terminate without liability on the part of any
non-defaulting Initial Purchasers and the Issuer, except that the Issuer will
continue to be liable for the payment of expenses to the extent set forth in
Section 11. As used in this Agreement, the term "Initial Purchaser" includes,
for all purposes of this Agreement unless the context requires otherwise, any
party not listed in Schedule 1 hereto who, pursuant to this
25
Section 9, purchases the Firm CODES or Optional CODES, as the case may be, which
a defaulting Initial Purchaser agreed but failed to purchase.
Nothing contained herein shall relieve a defaulting Initial Purchaser
of any liability it may have to the Company for damages caused by its default.
If other purchasers are obligated or agree to purchase the CODES of a defaulting
or withdrawing Initial Purchaser, either the remaining non-defaulting Initial
Purchasers or the Company may postpone the Delivery Date for up to seven full
business days in order to effect any changes in the Offering Memorandum or in
any other document or arrangement that, in the opinion of counsel to the Company
or counsel to the Initial Purchasers, may be necessary.
10. Termination. The obligations of the Initial Purchasers hereunder
may be terminated by the Initial Purchasers by notice given to and received by
the Company prior to delivery of and payment for the CODES if, prior to that
time, any of the events described in Sections 5(m), (n) and (p) shall have
occurred or if the Initial Purchasers shall decline to purchase the CODES for
any reason permitted under this Agreement.
11. Reimbursement of Initial Purchasers' Expenses. If the Company and
the Guarantors shall fail to tender the CODES and the Guarantees for delivery to
the Initial Purchasers by reason of any failure, refusal or inability on the
part of the Company and the Guarantors 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 and the Guarantors
is not fulfilled, the Company and the Guarantors will reimburse the Initial
Purchasers for all reasonable out-of-pocket expenses (including fees and
disbursements of counsel) incurred by the Initial Purchasers in connection with
this Agreement and the proposed purchase of the CODES and the Guarantees, and
upon demand the Company and the Guarantors shall pay the full amount thereof to
Xxxxxx Brothers Inc. on behalf of the several Initial Purchasers.
12. 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 (i) Xxxxxx Brothers Inc., 000 Xxxxxxx Xxxxxx,
Xxx Xxxx, Xxx Xxxx 00000, Attention: Syndicate Registration (Fax: 000-000-0000)
and (ii) Credit Suisse First Boston LLC, Eleven Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx
Xxxx 00000-0000, Attention: Transactions Advisory Group (Fax: 000-000-0000) and
(iii) Banc of America Securities LLC, 0 Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000, Attention: Xxxxxx Xxxxxxxx (Fax: 000-000-0000) and (iv) Bear, Xxxxxxx &
Co. Inc, 000 Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: H. Xxxxxxx
Xxxx, with a copy to Xxxxxx & Xxxxxxx LLP, 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000, Attention: Xxxx X. Xxxxxxxxx (Fax: 000-000-0000) and, in the case of any
notice pursuant to Section 8(c), to the Director of Litigation, Office of the
General Counsel (Fax: 000-000-0000), Xxxxxx Brothers Inc., 000 Xxxx Xxxxxx, 00xx
Xxxxx (Fax: 000-000-0000), Xxx Xxxx, XX 00000; and
(b) if to the Company and the Guarantors, shall be delivered or sent
by mail, telex or facsimile transmission to L-3 Communications Holdings, Inc.,
000 Xxxxx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Xxxxxxxxxxx
X. Xxxxxxx (Fax: 000-000-0000),
26
with a copy to Xxxxxxx Xxxxxxx & Xxxxxxxx LLP, 000 Xxxxxxxxx Xxxxxx, Xxx Xxxx,
Xxx Xxxx 00000, Attention: Xxxxxxx Xxxxxx, Xx. (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.
13. Research Independence. In addition, the Company and the Guarantors
acknowledge that the Initial Purchasers' research analysts and research
departments are required to be independent from their respective investment
banking divisions and are subject to certain regulations and internal policies,
and that such Initial Purchasers' research analysts may hold and make statements
or investment recommendations and/or publish research reports with respect to
the Company and the Guarantors and/or the offering that differ from the views of
its investment bankers. The Company and the Guarantors hereby waive and release,
to the fullest extent permitted by law, any claims that the Company or the
Guarantors may have against the Initial Purchasers with respect to any conflict
of interest that may arise from the fact that the views expressed by their
independent research analysts and research departments may be different from or
inconsistent with the views or advice communicated to the Company or the
Guarantors by such Initial Purchasers' investment banking divisions. The Company
and the Guarantors acknowledge that each of the Initial Purchasers is a full
service securities firm and as such from time to time, subject to applicable
securities laws, may effect transactions for its own account or the account of
its customers and hold long or short positions in debt or equity securities of
the companies which may be the subject of the transactions contemplated by this
Agreement.
14. Persons Entitled to Benefit of Agreement. This Agreement shall
inure to the benefit of and be binding upon the Initial Purchasers, the Company,
the Guarantors and their respective successors. This Agreement and the terms and
provisions hereof are for the sole benefit of only those persons, except that
(A) the representations, warranties, indemnities and agreements of the Company
and the Guarantors contained in this Agreement shall also be deemed to be for
the benefit of the officers and employees of each Initial Purchaser and the
person or persons, if any, who control any Initial Purchaser within the meaning
of Section 15 of the Securities Act and (B) any indemnity agreement of the
Initial Purchasers contained in Section 7(b) of this Agreement shall be deemed
to be for the benefit of directors and officers of the Company and any person
controlling the Company and the Guarantors within the meaning of Section 15 of
the Securities Act. Nothing contained in this Agreement is intended or shall be
construed to give any person, other than the persons referred to in this Section
14, any legal or equitable right, remedy or claim under or in respect of this
Agreement or any provision contained herein.
15. Survival. The respective indemnities, representations, warranties
and agreements of the Company, the Guarantors and the Initial Purchasers
contained in this Agreement or made by or on behalf of them, respectively,
pursuant to this Agreement, shall survive the delivery of and payment for the
CODES and shall remain in full force and effect, regardless of any termination
or cancellation of this Agreement or any investigation made by or on behalf of
any of them or any person controlling any of them.
27
16. Definition of the Terms "Business Day" and "Subsidiary." For
purposes of this Agreement, (a) "business day" means each Monday, Tuesday,
Wednesday, Thursday or Friday which is not a day on which banking institutions
in New York are generally authorized or obligated by law or executive order to
close and (b) "subsidiary" has the meaning set forth in Rule 405 of the
Securities Act Rules and Regulations.
17. Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED
IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
18. 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.
19. 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]
28
If the foregoing correctly sets forth the agreement among the Company,
the Guarantors and the Initial Purchasers, please indicate your acceptance in
the space provided for that purpose below.
Very truly yours,
L-3 COMMUNICATIONS HOLDINGS, INC.,
as the Company
By: /s/ Xxxxxxxxxxx X. Xxxxxxx
------------------------------------
Name: Xxxxxxxxxxx X. Xxxxxxx
Title: Senior Vice President,
Secretary and General Counsel
APCOM, INC.
BROADCAST SPORTS INC.
D.P. ASSOCIATES INC.
ELECTRODYNAMICS, INC.
XXXXXXXX INC.
HYGIENETICS ENVIRONMENTAL SERVICES, INC.
INTERSTATE ELECTRONICS CORPORATION
KDI PRECISION PRODUCTS, INC.
L-3 COMMUNICATIONS AEROMET, INC.
L-3 COMMUNICATIONS VERTEX AEROSPACE LLC
L-3 COMMUNICATIONS ADVANCED LASER SYSTEMS TECHNOLOGY, INC.
L-3 COMMUNICATIONS AIS GP CORPORATION
L-3 COMMUNICATIONS AVIONICS SYSTEMS, INC.
L-3 COMMUNICATIONS AVISYS CORPORATION
L-3 COMMUNICATIONS CE HOLDINGS, INC.
L-3 COMMUNICATIONS CINCINNATI ELECTRONICS CORPORATION
L-3 COMMUNICATIONS CORPORATION
L-3 COMMUNICATIONS CSI, INC.
L-3 COMMUNICATIONS AYDIN CORPORATION
L-3 COMMUNICATIONS ELECTRON TECHNOLOGIES, INC.
L-3 COMMUNICATIONS ESSCO, INC.
L-3 COMMUNICATIONS FLIGHT INTERNATIONAL AVIATION LLC
L-3 COMMUNICATIONS FLIGHT CAPITAL LLC
L-3 COMMUNICATIONS GOVERNMENT SERVICES, INC.
L-3 COMMUNICATIONS ILEX SYSTEMS, INC.
L-3 COMMUNICATIONS INFRARED VISION TECHNOLOGY CORPORATION
L-3 COMMUNICATIONS INVESTMENTS INC.
CODES Purchase Agreement
L-3 COMMUNICATIONS XXXXX ASSOCIATES, INC.
L-3 COMMUNICATIONS MAS (US) CORPORATION
L-3 COMMUNICATIONS MOBILE-VISION, INC.
L-3 COMMUNICATIONS SECURITY AND DETECTION SYSTEMS, INC.
L-3 COMMUNICATIONS SONOMA EO, INC.
L-3 COMMUNICATIONS VECTOR INTERNATIONAL AVIATION LLC
L-3 COMMUNICATIONS WESTWOOD CORPORATION
MCTI ACQUISITION CORPORATION
MICRODYNE COMMUNICATIONS TECHNOLOGIES INCORPORATED
MICRODYNE CORPORATION
MICRODYNE OUTSOURCING INCORPORATED
MPRI, INC.
PAC ORD INC.
POWER PARAGON, INC.
SHIP ANALYTICS, INC.
SHIP ANALYTICS INTERNATIONAL, INC.
SHIP ANALYTICS USA, INC.
SPD ELECTRICAL SYSTEMS, INC.
SPD SWITCHGEAR INC.
SYCOLEMAN CORPORATION
TROLL TECHNOLOGY CORPORATION
WESCAM AIR OPS INC.
WESCAM AIR OPS LLC
WESCAM HOLDINGS (US) INC.
WESCAM INCORPORATED
WESCAM LLC
WOLF COACH, INC.,
as Guarantors
By: /s/ Xxxxxxxxxxx X. Xxxxxxx
------------------------------------
Name: Xxxxxxxxxxx X. Xxxxxxx
Title: Vice President and Secretary
L-3 COMMUNICATIONS INTEGRATED SYSTEMS L.P., as a Guarantor
By: L-3 COMMUNICATIONS AIS GP CORPORATION,
as general partner
By: /s/ Xxxxxxxxxxx X. Xxxxxxx
--------------------------------
Name: Xxxxxxxxxxx X. Xxxxxxx
Title: Director
CODES Purchase Agreement
Accepted:
XXXXXX BROTHERS INC.
BEAR, XXXXXXX & CO. INC.
CREDIT SUISSE FIRST BOSTON LLC
BANC OF AMERICA SECURITIES LLC
For themselves and as Representatives
of the several Initial Purchasers named
in Schedule 1 hereto
By: XXXXXX BROTHERS INC.
By: /s/ Xxxxx Xxxxx
--------------------------------
Authorized Representative
CODES Purchase Agreement
