View:
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14D-1
(Amendment No. 10)
TENDER OFFER STATEMENT
PURSUANT TO SECTION 14(d)(1) OF THE
SECURITIES EXCHANGE ACT OF 1934
LORAL CORPORATION
(Name of Subject Company)
LOCKHEED MARTIN CORPORATION
LAC ACQUISITION CORPORATION
(Bidders)
Common Stock, par value $0.25 per share
(Title of Class of Securities)
543859 10 2
(CUSIP number of Class of Securities)
Frank H. Menaker, Jr., Esq.
Lockheed Martin Corporation
6801 Rockledge Drive
Bethesda, Maryland 20817
(301) 897-6000
(Name, address and telephone number of person
authorized to receive notice and communications on
behalf of the person(s) filing statement)
With a copy to:
Peter Allan Atkins, Esq.
Lou R. Kling, Esq.
Skadden, Arps, Slate, Meagher & Flom
919 Third Avenue
New York, New York 10022
(212) 735-3000
This Amendment No. 10 amends and supplements
the Tender Offer Statement on Schedule 14D-1 (as may be
amended from time to time, the "Schedule 14D-1") of LAC
Acquisition Corporation, a New York corporation (the
"Purchaser") and a wholly-owned subsidiary of Lockheed
Martin Corporation, a Maryland corporation ("Lockheed
Martin"), filed on January 12, 1996 with the Securities
and Exchange Commission (the "Commission") in respect of
the tender offer (the "Offer") by the Purchaser for all
of the outstanding shares of Common Stock, par value
$0.25 per share, of Loral Corporation (the "Company" or
"Loral"). The Offer is being made pursuant to an
Agreement and Plan of Merger dated as of January 7, 1995
by and among the Company, Purchaser and Lockheed Martin.
All capitalized terms set forth herein which are not
otherwise defined herein shall have the same meanings as
ascribed thereto in the Offer to Purchase, dated January
12, 1996 (which is attached as Exhibit (a)(9) to the
Schedule 14D-1 (the "Offer to Purchase")). In connection
with the foregoing, the Purchaser and Lockheed Martin are
hereby amending and supplementing the Schedule 14D-1 as
follows:
Item 5. PURPOSE OF THE TENDER OFFER AND PLANS OR
PROPOSALS OF THE BIDDER.
Item 5(a)-(e) is hereby amended and
supplemented by the addition of the following paragraphs
thereto:
"Exchange Agreement. Prior to the
Distribution Date, Loral SpaceCom, the Company and
Lockheed Martin intend to enter into an Exchange
Agreement providing that, in the event that Loral
SpaceCom is required to purchase additional shares
of SS/L common stock held by the SS/L Strategic
Partners or the Lehman Partnerships (a "Put
Transaction"), and such Put Transaction requires a
filing with, or the approval of, any antitrust
authorities having jurisdiction over the matter, the
parties will cooperate to comply with informational
requirements and jointly attempt to resolve any
objections raised without any change in Lockheed
Martin's ownership interest in Loral SpaceCom. If
such a change is nonetheless required to obtain
antitrust approval of the Put Transaction, Lockheed
Martin will be required to transfer to Loral
SpaceCom some or all of the shares of Loral SpaceCom
securities beneficially owned by it in exchange for
shares of GTL Common Stock or, if the use of GTL
Common Stock as consideration is inconsistent with
obtaining antitrust approval for the Put
Transaction, in exchange for cash. The shares of
Loral SpaceCom securities so transferred will be
valued at the greater of the fair market value or
the original purchase price thereof in connection
with the Distribution, increased at the rate of 10%
per annum, compounded annually, from the date of the
consummation of the Offer.
The foregoing summary of the Exchange Agreement
does not purport to be complete and is qualified in
its entirety by reference to the text of the Form of
Exchange Agreement dated as of April 22, 1996 which
is herein incorporated by reference, a copy of which
is attached hereto and filed as Exhibit (c)(16) to
the Schedule 14D-1."
"The Merger Agreement. On April 15, 1996,
Loral, Lockheed Martin and the Purchaser agreed to
an amendment to the Merger Agreement that permits
the Board of Directors of Loral to provide that all
Stock Options which are outstanding immediately
prior to Purchaser's acceptance for payment and
payment for Shares tendered pursuant to the Offer
and which are held by holders who are subject to the
reporting requirements of Section 16(a) of the
Exchange Act will be cancelled and the holders
thereof will be entitled to receive from the
Company, for each Share subject to such Stock
Option, (1) an amount in cash equal to the
difference between the Merger Price and the exercise
price per share of such Stock Option, which amount
will be payable upon consummation of the Offer, plus
(2) one share of common stock, par value $0.01 per
share of Loral SpaceCom (Loral SpaceCom Common
Stock"), on the same basis as all other holders of
Stock Options.
The foregoing summary of the Merger Agreement
does not purport to be complete and is qualified in
its entirety by reference to the text of the Letter
Amendment to the Agreement and Plan of Merger dated
as of April 15, 1996 which is herein incorporated by
reference, a copy of which is attached hereto and
filed as Exhibit (c)(14) to the Schedule 14D-1."
Item 5(a)-(e) is hereby further amended
and supplemented by replacing the section in the
Offer to Purchase encaptioned "Loral Space
Stockholders Agreement" with the following:
"Shareholders Agreement. On or prior to
the Distribution Date, Loral SpaceCom and the
Company will enter into a Shareholders Agreement
(the "Shareholders Agreement") which establishes,
among other things, certain conditions with respect
to the relationship between Loral SpaceCom, on the
one hand, and the Company and its affiliates (the
"Subject Shareholders"), on the other hand. The
Shareholders Agreement limits the ability of Subject
Shareholders, during the term of the Shareholders
Agreement to acquire any voting securities or assets
of, or solicit proxies or make a public announcement
of a proposal of any extraordinary transaction with
respect to, Loral SpaceCom. The Series A
convertible preferred stock, par value $.01 per
share, of Loral SpaceCom (the "Series A Preferred
Stock") issued to the Company may be voted without
restriction on all matters submitted to shareholders
for approval, except that it may not vote for the
election of directors. Subject Shareholders may
vote their shares of Loral SpaceCom Common Stock on
all matters, including the election of directors,
except that in the event of an election contest, the
Subject Shareholders have agreed, pursuant to the
Shareholders Agreement, that they will, subject to
certain exceptions, vote any of Loral SpaceCom's
equity securities, at the option of the Subject
Shareholders, either (i) as recommended by the Board
of Directors or management of Loral SpaceCom, or
(ii) in the same proportions as the other holders of
Loral SpaceCom's equity securities vote their
securities. The Shareholders Agreement also limits
the ability of the Subject Shareholders to transfer
the equity securities of Loral SpaceCom held by the
Subject Shareholders except pursuant to a registered
public offering, the volume limitations of Rule 144
under the Exchange Act or pursuant to certain
permitted transfers. The Shareholders Agreement
provides that if, within one year following the date
thereof, the Subject Shareholders vote against any
transaction involving (i) a merger, consolidation,
corporate reorganization or similar transaction or
(ii) a sale, lease, exchange, transfer or other
disposition of all or substantially all of the
assets of Loral SpaceCom or any of its affiliates,
in either case between Loral SpaceCom, on the one
hand, and SS/L, K&F, GTL, Globalstar and certain
other subsidiaries and affiliates of the Loral
SpaceCom, on the other hand, Loral SpaceCom shall
have the right to purchase from the Subject
Shareholders all of the equity securities of Loral
SpaceCom held by the Subject Shareholders for a
price equal to $344 million plus all amounts
expended by the Subject Shareholders following the
date of the Shareholders Agreement in connection
with the acquisition of equity securities (other
than acquisitions from another Subject Shareholder)
following the date of the Shareholders Agreement
minus any net sales proceeds received by the Subject
Shareholders following the date of the Shareholders
Agreement in connection with the sale of equity
securities (other than sales to another Subject
Shareholder) following the date of the Shareholders
Agreement. The Shareholders Agreement also provides
that if, within five years following the date
hereof, any transaction occurs involving (i) a
merger, consolidation, corporate reorganization or
similar transaction, (ii) a sale, lease, exchange,
transfer or other disposition of all or
substantially all of the assets of Loral SpaceCom,
Globalstar or any of their respective affiliates or
(iii) the liquidation or dissolution of Loral
SpaceCom (each of the transactions set forth in
clauses (i) through (iii) referred to as a
"Triggering Transaction"), in each case, involving
as parties, Loral SpaceCom or any of its affiliates,
on the one hand, and either GTL or Globalstar or any
of their respective subsidiaries on the other hand,
the Company shall have the right to purchase from
Loral SpaceCom (including any successor to the
rights and obligations of Loral SpaceCom) a
sufficient number of shares of Loral SpaceCom (or
such successor) to prevent dilution at a per share
price equal to (x) if the Triggering Transaction
shall occur on a date prior to the first anniversary
thereof, $6.00, subject to antidilution adjustments
and (y) if the Triggering Transaction shall occur
after the first anniversary, but prior to the fifth
anniversary thereof, 80% of the per share price of
Loral SpaceCom implicit in the Triggering
Transaction. The Shareholders Agreement also
provides that in the event of certain transactions,
the Subject Shareholders shall have the right to
require Loral SpaceCom to purchase the Guarantee
Warrants issued to the Company at fair market value.
The Shareholders Agreement also provides that under
certain circumstances involving the repurchase by
Loral SpaceCom of its equity securities, the Subject
Shareholders will sell to Loral SpaceCom such number
of Loral SpaceCom equity securities held by them
sufficient to reduce the Subject Shareholders'
ownership of Loral SpaceCom equity securities to 20%
at a price equal to the repurchase price offered by
Loral SpaceCom, provided, however, that if the
repurchase price is less than the purchase price
initially paid by the Subject Shareholders for the
Series A Preferred Stock, as adjusted by a 10%
compounded annual rate of increase, the Subject
Shareholders may elect, in lieu of selling such
equity securities to Loral SpaceCom, to sell such
equity securities to third parties over certain time
periods, which periods in no event will be less than
six months after the date the Subject Shareholders
deliver notice of their election to Loral SpaceCom.
The Shareholders Agreement further provides that
under certain circumstances and subject to certain
conditions the Subject Shareholders may require
Loral SpaceCom to register under the Securities Act
any Loral SpaceCom securities held by the Subject
Shareholders. The Shareholders Agreement provides,
subject to certain exceptions, that, in the event of
a tender offer, if Subject Shareholders wish to sell
or transfer any Loral Spacecom securities pursuant
to the tender offer the subject Shareholders must
first offer the shares for sale to Loral SpaceCom.
The terms of the Shareholders Agreement will
continue until the earlier of (x) the date on which
the voting power of the equity securities owned by
the Subject Shareholders represents, on a fully-
diluted basis, less than five percent (5%) of the
total voting power, (y) the tenth anniversary of the
date of the agreement, or (z) a change of control
Loral SpaceCom.
After the seventh anniversary of the date of
the Shareholders Agreement, the Subject Shareholders
shall have the right to propose for election to the
Board of Directors in opposition to management's
nominees the number of directors that is
proportionate to the percentage of voting securities
of Loral SpaceCom then held by the Subject
Shareholders and to vote in favor of their election
to the Board.
The foregoing summary of the Shareholders
Agreement does not purport to be complete and is
qualified in its entirety by reference to the text
of the Form of Shareholders Agreement dated as of
April 22, 1996 which is herein incorporated by
reference, a copy of which is attached hereto and
filed as Exhibit (c)(15) to the Schedule 14D-1."
Item 7. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR
RELATIONSHIPS WITH RESPECT TO THE SUBJECT
COMPANY'S SECURITIES
Item 7 is hereby amended and supplemented as
set forth in Item 5 above.
Item 10. ADDITIONAL INFORMATION.
Item 10(a) is hereby amended and supplemented
as set forth in Item 5 above.
Item 10(b)-(c) is hereby amended and
supplemented by the addition of the following paragraph
thereto:
"Hart-Scott-Rodino. On April 18, 1996
Lockheed Martin was notified that the FTC had
terminated the waiting period under the Hart-Scott-
Rodino Antitrust Improvements Act of 1976, as
amended (the "HSR Act")."
Item 11. Material to be Filed as Exhibits
Item 11 is hereby amended and supplemented by
the addition of the following exhibits thereto:
Exhibit (b)(5) Revolving Credit Agreement (364 day),
dated as of April 15, 1996, by and
among Lockheed Martin Corporation,
LAC Acquisition Corporation, as
Guarantor, the Banks listed therein,
Morgan Guaranty Trust Company of New
York, as Documentation Agent, and
Bank of America National Trust and
Savings Association, as
Administrative Agent
Exhibit (b)(6) Revolving Credit Agreement (5 year),
dated as of April 15, 1996, by and
among Lockheed Martin Corporation,
LAC Acquisition Corporation, as
Guarantor, the Banks listed therein,
Morgan Guaranty Trust Company of New
York, as Documentation Agent, and
Bank of America National Trust and
Savings Association, as
Administrative Agent
Exhibit (c)(14) Letter Amendment dated as of April
15, 1996 to the Agreement and Plan of
Merger, dated as of January 7, 1996,
by and among Loral Corporation,
Lockheed Martin Corporation and LAC
Acquisition Corporation.
Exhibit (c)(15) Form of Shareholders Agreement, dated
as of April 22, 1996, by and among
Loral Corporation and Loral Space &
Communications Ltd.
Exhibit (c)(16) Form of Exchange Agreement, dated as
of April 22, 1996, by and among Loral
Space & Communications Ltd., Lockheed
Martin Corporation and Loral
Corporation.
SIGNATURE
After reasonable inquiry and to the best of my
knowledge and belief, I certify that the information set
forth in this statement is true, complete and correct.
LAC ACQUISITION CORPORATION
By:/s/ STEPHEN M. PIPER
Name: Stephen M. Piper
Title: Assistant Secretary
Dated: April 19, 1996
SIGNATURE
After reasonable inquiry and to the best of my
knowledge and belief, I certify that the information set
forth in this statement is true, complete and correct.
LOCKHEED MARTIN CORPORATION
By:/s/ STEPHEN M. PIPER
Name: Stephen M. Piper
Title: Assistant Secretary
Dated: April 19, 1996
EXHIBIT INDEX
Exhibit No. Description
Exhibit (b)(5) Revolving Credit Agreement (364 day),
dated as of April 15, 1996, by and among
Lockheed Martin Corporation, LAC
Acquisition Corporation, as Guarantor, the
Banks listed therein, Morgan Guaranty
Trust Company of New York, as
Documentation Agent, and Bank of America
National Trust and Savings Association, as
Administrative Agent
Exhibit (b)(6) Revolving Credit Agreement (5 year), dated
as of April 15, 1996, by and among
Lockheed Martin Corporation, LAC
Acquisition Corporation, as Guarantor, the
Banks listed therein, Morgan Guaranty
Trust Company of New York, as
Documentation Agent, and Bank of America
National Trust and Savings Association, as
Administrative Agent
Exhibit (c)(14) Letter Amendment dated as of April 15,
1996 to the Agreement and Plan of Merger,
dated as of January 7, 1996, by and among
Loral Corporation, Lockheed Martin
Corporation and LAC Acquisition
Corporation.
Exhibit (c)(15) Form of Shareholders Agreement, dated as
of April 22, 1996, by and among Loral
Corporation and Loral Space &
Communications Ltd.
Exhibit (c)(16) Form of Exchange Agreement, dated as of
April 22, 1996, by and among Loral Space &
Communications Ltd., Lockheed Martin
Corporation and Loral Corporation.
[CONFORMED COPY]
$5,000,000,000
REVOLVING CREDIT AGREEMENT
(364 day)
dated as of
April 15, 1996
among
LOCKHEED MARTIN CORPORATION,
LAC ACQUISITION CORPORATION,
as Guarantor,
The BANKS Listed Herein,
MORGAN GUARANTY TRUST COMPANY OF NEW YORK,
as Documentation Agent,
and
BANK OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION,
as Administrative Agent
TABLE OF CONTENTS*
Page
ARTICLE I
DEFINITIONS
1.01. Definitions.............................................. 1
1.02. Accounting Terms and Determinations...................... 14
ARTICLE II
THE LOANS
2.01. The Committed Loans...................................... 15
2.02. Method of Committed Borrowing............................ 15
2.03. Money Market Borrowings.................................. 16
2.04. Notice to Banks; Funding of Loans........................ 20
2.05. Conversion/Continuation of Loans......................... 22
2.06. Loan Accounts and Notes.................................. 23
2.07. Payment of Principal..................................... 24
2.08. Interest................................................. 24
2.09. Optional Prepayments..................................... 26
2.10. General Provisions as to Payments........................ 27
2.11. Fees..................................................... 28
2.12. Reduction or Termination of Commitments.................. 28
2.13. Lending Offices.......................................... 29
2.14. Reimbursement............................................ 29
ARTICLE III
CONDITIONS
3.01. Conditions to Closing.................................... 30
3.02. Conditions to All Loans.................................. 32
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
4.01. Corporate Existence and Power............................ 32
4.02. No Contravention......................................... 33
4.03. Corporate Authorization; Binding Effect.................. 33
4.04. Financial Information.................................... 33
4.05. Litigation; Taxes........................................ 34
4.06. Margin Regulations....................................... 34
4.07. Governmental Approvals................................... 34
4.08. Pari Passu Obligations................................... 35
4.09. No Defaults.............................................. 35
4.10. Full Disclosure.......................................... 35
4.11. ERISA.................................................... 35
4.12. Environmental Matters.................................... 35
ARTICLE V
COVENANTS
5.01. Information.............................................. 36
5.02. Payment of Obligations................................... 38
5.03. Insurance................................................ 38
5.04. Maintenance of Existence................................. 38
5.05. Maintenance of Properties................................ 39
5.06. Compliance With Laws..................................... 39
5.07. Mergers, Consolidations and Sales of
Assets................................................... 39
5.08. Limitation on Liens...................................... 40
5.09. Leverage Ratio........................................... 43
5.10. Use of Loans............................................. 43
ARTICLE VI
DEFAULTS
6.01. Events of Default........................................ 43
ARTICLE VII
THE AGENTS
7.01. Appointment and Authorization............................ 46
7.02. Agents and Affiliates.................................... 46
7.03. Action by Agents......................................... 47
7.04. Consultation with Experts................................ 47
7.05. Liability of Agents...................................... 47
7.06. Indemnification.......................................... 47
7.07. Credit Decision.......................................... 48
7.08. Successor Agents......................................... 48
7.09. Agents' Fees............................................. 48
ARTICLE VIII
CHANGE IN CIRCUMSTANCES
8.01. Increased Cost and Reduced Return;
Capital Adequacy......................................... 49
8.02. Substitute Rate.......................................... 50
8.03. Illegality............................................... 50
8.04. Taxes on Payments........................................ 51
ARTICLE IX
GUARANTEE
9.01. Unconditional Guarantee.................................. 54
9.02. Discharge; Reinstatement................................. 55
9.03. Limit of Liability....................................... 55
ARTICLE X
MISCELLANEOUS
10.01. Termination of Commitment of a Bank; New
Banks.................................................... 55
10.02. Notices.................................................. 56
10.03. No Waivers............................................... 57
10.04. Expenses; Indemnification................................ 57
10.05. Pro Rata Treatment....................................... 57
10.06. Sharing of Set-Offs...................................... 58
10.07. Amendments and Waivers................................... 58
10.08. Successors and Assigns; Participations;
Novation................................................. 58
10.09. Visitation............................................... 62
10.10. Reference Banks.......................................... 62
10.11. Governing Law; Submission to Jurisdiction................ 62
10.12. Effectiveness; Counterparts; Integration................. 62
10.13. WAIVER OF JURY TRIAL..................................... 62
10.14. Confidentiality.......................................... 63
10.15. Termination and Payment under Existing
Agreements............................................... 63
SCHEDULE I - Pricing
Exhibit A - Notice of Committed Borrowing
Exhibit B - Money Market Quote Request
Exhibit C - Invitation for Money Market Quotes
Exhibit D - Money Market Quote
Exhibit E - Notice of Money Market Borrowing
Exhibit F - Notice of Conversion/Continuation
Exhibit G-1 - Form of Committed Note
Exhibit G-2 - Form of Money Market Note
Exhibits H-1
and H-2 - Opinions of Special Counsel to the Company
Exhibit H-3 - Opinion of General Counsel to the Company
Exhibit I - Opinion of Special Counsel to the Agents
Exhibit J - Compliance Certificate
Exhibit K - Assignment and Assumption Agreement
- --------
* The Table of Contents is not a part of this Agreement.
REVOLVING CREDIT AGREEMENT
AGREEMENT dated as of April 15, 1996 among LOCKHEED MARTIN
CORPORATION, LAC ACQUISITION CORPORATION, as Guarantor, the BANKS listed on
the signature pages hereof, MORGAN GUARANTY TRUST COMPANY OF NEW YORK, as
Documentation Agent, and BANK OF AMERICA NATIONAL TRUST AND SAVINGS
ASSOCIATION, as Administrative Agent.
ARTICLE I
DEFINITIONS
SECTION 1.01. Definitions. The following terms,
as used herein and in any Exhibit or Schedule hereto, have
the following meanings:
"Acquisition" means the acquisition by the Company, through
Acquisition Company, of Loral pursuant to the Merger Agreement, including
the Tender Offer and the Merger.
"Acquisition Company" means LAC Acquisition Corporation, a New York
corporation.
"Adjusted CD Rate" means, with respect to any Interest Period
(but subject to the last sentences of the definitions of Assessment Rate
and Domestic Reserve Percentage), a rate per annum determined pursuant to
the following formula:
[ CDBR ]*
ACDR = [ ---------- ] + AR
[ 1.00 - DRP ]
ACDR = Adjusted CD Rate
CDBR = CD Base Rate
DRP = Domestic Reserve Percentage
AR = Assessment Rate
----------
* The amount in brackets being rounded upward to
the next higher 1/100 of 1%
"Administrative Agent" means Bank of America National Trust and
Savings Association in its capacity as administrative agent for the Banks
hereunder, and its successor or successors in such capacity.
"Administrative Questionnaire" means, with respect to each
Bank, an administrative questionnaire in the form prepared by the
Administrative Agent and submitted to the Agents with a copy to the Company
duly completed by such Bank.
"Agents" means the Administrative Agent and the Documentation
Agent, and "Agent" means either of the foregoing.
"Agreement" means this Revolving Credit Agreement as it may be
amended from time to time.
"Applicable Lending Office" means, with respect to any Bank,
(i) in the case of its Domestic Loans, its Domestic Lending Office, (ii) in
the case of its Eurodollar Loans, its Eurodollar Lending Office and (iii)
in the case of its Money Market Loans, its Money Market Lending Office.
"Assessment Rate" means for any day the annual assessment rate
in effect on such day which is payable by a member of the Bank Insurance
Fund classified as adequately capitalized and within supervisory subgroup
"A" (or a comparable successor assessment risk classification) within the
meaning of 12 C.F.R. ss. 327.3(e) (or any successor provision) to the
Federal Deposit Insurance Corporation (or any successor) for such
Corporation's (or such successor's) insuring time deposits at offices of
such institution in the United States. The Adjusted CD Rate shall be
adjusted automatically on and as of the effective date of any change in the
Assessment Rate.
"Assignee" has the meaning set forth in Section 10.08(c).
"Assignment and Assumption Agreement" means an agreement,
substantially in the form of Exhibit K hereto, under which an interest of a
Bank hereunder is transferred to an Assignee pursuant to Section 10.08(c)
hereof.
"Bank" means (i) each bank or financial institution listed on
the signature pages hereof, (ii) each bank or financial institution that
becomes a Bank pursuant to either Section 10.01 or Section 10.08(c), and
(iii) their respective successors.
"Base Rate" means, for any day, a rate per annum equal to the
higher of (i) the Reference Rate for such day or (ii) the sum of 1/2 of 1%
plus the Federal Funds Rate for such day, each change in the Base Rate to
become effective on the day on which such change occurs.
"Base Rate Loan" means any Committed Loan in respect of which
interest is to be computed on the basis of the Base Rate.
"Capitalized Lease Obligations" means any and all monetary
obligations under any leasing arrangements which have been capitalized, as
such obligations are reported in the consolidated financial statements of
the Company and the Consolidated Subsidiaries.
"CD Base Rate" means, with respect to any Interest Period, the
rate of interest determined by the Administrative Agent to be the average
(rounded upward to the next higher 1/100 of 1%) of the prevailing rates per
annum bid at 10:00 a.m. (New York time) (or as soon thereafter as
practicable) on the first day of such Interest Period by two or more
certificate of deposit dealers of recognized standing for the purchase at
face value from each CD Reference Bank of its certificates of deposit in an
amount comparable to the principal amount of the CD Loan of such CD
Reference Bank to which such Interest Period applies and having a maturity
comparable to such Interest Period.
"CD Loan" means any Committed Loan in respect of which interest
is to be computed on the basis of the Adjusted CD Rate.
"CD Margin" means the percentage determined pursuant to Section
2.08(d) and Schedule I.
"CD Reference Banks" means Bank of America National Trust and
Savings Association, Citibank, N.A. and First Interstate Bank of California.
"Change in Law" means, for purposes of Section 8.01 and Section
8.03, the adoption of any applicable law, rule or regulation, or any change
therein, or any change in the interpretation or administration thereof by
any governmental authority, central bank or comparable agency charged with
the interpretation or administration thereof, or compliance by any Bank
with any request or directive (whether or not having the force of law) of
any such authority, central bank or comparable agency.
"Closing Date" means the date, not later than April 30, 1996
(or if the condition referred to in Section 3.01(h) has not been satisfied
on or before such date solely because the waiting period contemplated by
the Hart-Scott- Rodino Act Antitrust Improvements Act of 1976, as amended,
has not expired or otherwise terminated, not later than June 30, 1996), on
which all the conditions referred to in Section 3.01 shall have been
satisfied.
"Commitment" means as to each Bank at any time, the amount set
forth opposite such Bank's name on the signature pages hereof or in the
applicable Assignment and Assumption Agreement, as such amount may be
increased or decreased pursuant to the terms of this Agreement.
"Commitment Termination Date" means April 14, 1997 (or if such
date is not a Domestic Business Day, the next preceding Domestic Business
Day).
"Committed Loan" means a Loan made by a Bank pursuant to
Section 2.01.
"Committed Notes" means promissory notes of the Company,
substantially in the form of Exhibit G-1 hereto, evidencing the obligation
of the Company to repay the Committed Loans, and "Committed Note" means any
one of such promissory notes issued hereunder.
"Company" means Lockheed Martin Corporation, a
Maryland corporation, and its successors.
"Consolidated Subsidiary" means at any date any Subsidiary the
accounts of which would be consolidated with the Company in its
consolidated financial statements if such statements were prepared as of
such date. For purposes of Sections 4.04 and 5.01 and the definition of the
term "Exempt Subsidiary", Consolidated Subsidiary includes any Exempt
Subsidiary.
"Debt" means all indebtedness for borrowed money, ESOP
guarantees and Capitalized Lease Obligations reported as debt in the
consolidated financial statements of the Company and the Consolidated
Subsidiaries, plus all indebtedness for borrowed money and capitalized
lease obligations incurred by third parties and guaranteed by the Company
or a Consolidated Subsidiary not otherwise reported as debt in such
consolidated financial statements.
"Default" means any condition or event which constitutes an
Event of Default or which with the giving of notice or lapse of time or
both would, unless cured or waived, become an Event of Default.
"Designated Representative" means any officer or
employee as shall be so identified in an Officer's
Certificate.
"Documentation Agent" means Morgan Guaranty Trust Company of
New York in its capacity as documentation agent for the Banks hereunder,
and its successors in such capacity.
"Dollars" or "$" means lawful currency of the
United States.
"Domestic Business Day" means any day except a Saturday, Sunday
or other day on which commercial banks in San Francisco or New York are
authorized by law to close.
"Domestic Lending Office" means, as to each Bank, its office
located at its address set forth in its Administrative Questionnaire (or
identified in its Administrative Questionnaire as its Domestic Lending
Office) or such other office as such Bank may hereafter designate as its
Domestic Lending Office by notice to the Company and the Agents; provided
that any Bank may so designate separate Domestic Lending Offices for its
Base Rate Loans, on the one hand, and its CD Loans, on the other hand, in
which case all references herein to the Domestic Lending Office of such
Bank shall be deemed to refer to either or both of such offices, as the
context may require.
"Domestic Loans" means CD Loans or Base Rate
Loans or both.
"Domestic Reserve Percentage" means for any day that percentage
(expressed as a decimal) which is in effect on such day, as prescribed by
the Board of Governors of the Federal Reserve System (or any successor) for
determining the maximum reserve requirement (including without limitation
any basic, supplemental or emergency reserves) for a member bank of the
Federal Reserve System in New York City with deposits exceeding five
billion dollars in respect of new non-personal time deposits in dollars in
New York City having a maturity comparable to the related Interest Period
and in an amount of $100,000 or more. The Adjusted CD Rate shall be
adjusted automatically on and as of the effective date of any change in the
Domestic Reserve Percentage.
"Eligible Institution" means any commercial bank having total
assets in excess of $3,000,000,000 (or the equivalent amount in the local
currency of such bank) as determined by the Documentation Agent based on
the most recent publicly available financial statements of such bank, or
any affiliates thereof that are financial institutions.
"Environmental Laws" means any and all applicable federal,
state and local statutes, regulations, ordinances, rules, administrative
orders, consent decrees, permits, concessions, grants, franchises,
licenses, agreements or other governmental restrictions relating to the
environment or to emissions, discharges or releases of pollutants,
contaminants, hazardous substances, or hazardous wastes into the
environment including, without limitation, ambient air, surface water,
ground water, or land, or otherwise relating to the manufacture,
processing, distribution, use, treatment, storage, disposal, transport or
handling of pollutants, contaminants, hazardous substances, or hazardous
wastes.
"ERISA" means the Employee Retirement Income Security Act of
1974, as in effect from time to time.
"ERISA Group" means the Company and all members of a controlled
group of corporations and all trades or businesses (whether or not
incorporated) under common control that, together with the Company, are
treated as a single employer under Section 414 of the Internal Revenue
Code.
"Eurodollar Auction" means a solicitation of Money Market
Quotes setting forth Money Market Margins based on the Eurodollar Rate
pursuant to Section 2.03.
"Eurodollar Business Day" means any Domestic Business Day on
which commercial banks are open for international business (including
dealings in dollar deposits) in London.
"Eurodollar Lending Office" means, as to each Bank, its office,
branch or affiliate located at its address set forth in its Administrative
Questionnaire (or identified in its Administrative Questionnaire as its
Eurodollar Lending Office) or such other office, branch or affiliate of
such Bank as it may hereafter designate as its Eurodollar Lending Office by
notice to the Company and the Agents.
"Eurodollar Loan" means any Committed Loan in respect of which
interest is to be computed on the basis of the Eurodollar Rate.
"Eurodollar Margin" means the percentage
determined pursuant to Section 2.08(d) and Schedule I.
"Eurodollar Rate" means, in respect of any Eurodollar Loan for
any Interest Period therefor, a rate per annum equal to the arithmetic
average (rounded upwards to the nearest 1/16th of 1%) of the respective
rates per annum at which deposits in Dollars are offered to each of the
Eurodollar Reference Banks in the London interbank market in an amount
approximately equal to the principal amount of the Eurodollar Loan of such
Eurodollar Reference Bank, or, in the case of a Money Market Eurodollar
Loan, the principal amount of such Loan for which the Eurodollar Rate is
being determined for maturities comparable to such Interest Period as of
approximately 11:00 a.m. (London time) two Eurodollar Business Days prior
to the commencement of such Interest Period.
"Eurodollar Reference Banks" means the principal
London offices of Bank of America National Trust and
Savings Association, Barclays Bank PLC and Morgan Guaranty Trust
Company of New York.
"Event of Default" has the meaning set forth in
Section 6.01.
"Exchange Act" means the Securities Exchange Act
of 1934, as amended.
"Exempt Subsidiary" means Lockheed Martin Finance Corporation,
Martin Marietta Materials, Inc. and any other entity of which the Company
owns a sufficient number of securities or other ownership interests having
ordinary voting power to elect a majority of the board of directors or
other governing body that is designated as such pursuant to an Officer's
Certificate; provided that no such designation may be made unless, as of
the end of the most recent fiscal quarter prior to such designation, the
book value, net of depreciation and amortization and after intercompany
eliminations, of the assets of such entity, when aggregated with the book
values, net of depreciation and amortization and after intercompany
eliminations, of the assets of all Exempt Subsidiaries, other than Lockheed
Martin Finance Corporation and Martin Marietta Materials, Inc., does not
exceed 6% of the book value of the total assets of the Company and its
Consolidated Subsidiaries. Exempt Subsidiary includes any direct or
indirect subsidiary of an Exempt Subsidiary.
"Facility Fee" has the meaning set forth in Section 2.11.
"Failed Loan" has the meaning specified in Section 2.04(e).
"Federal Funds Rate" means, for any day, the rate per annum
(rounded upward, if necessary, to the nearest 1/100th of 1%) equal to the
weighted average of the rates on overnight Federal funds transactions with
members of the Federal Reserve System arranged by Federal funds brokers on
such day, as published by the Federal Reserve Bank of New York on the
Domestic Business Day next succeeding such day, provided that (i) if such
day is not a Domestic Business Day, the Federal Funds Rate for such day
shall be such rate on such transactions on the next preceding Domestic
Business Day as so published on the next succeeding Domestic Business Day,
and (ii) if no such rate is so published on such next succeeding Domestic
Business Day, the Federal Funds Rate for such day shall be the average rate
quoted to the Administrative Agent on such day on such transactions as
determined by it.
"Fixed Rate Loans" means CD Loans, Eurodollar Loans or Money
Market Loans (excluding Money Market Eurodollar Loans bearing interest at
the Base Rate pursuant to Section 8.03) or any combination of the
foregoing.
"Governmental Authority" means any nation or government, any
state or other political subdivision thereof, any central bank (or similar
monetary or regulatory authority) thereof, any entity exercising executive,
legislative, judicial, regulatory or administrative functions of or
pertaining to government and any corporation or other entity owned or
controlled, through stock or capital ownership or otherwise, by any of the
foregoing.
"Guarantor" means Acquisition Company and its successors.
"Information Memorandum" means the Lockheed Martin Information
Memorandum -- $10.0 Billion Senior Credit Facilities previously distributed
to the Banks, as amended and supplemented prior to February 16, 1996.
"Interest Period" means: (a) as to each (1) Eurodollar Loan, a
period commencing on the date of borrowing specified in the applicable
Notice of Borrowing or on the date specified in the applicable Notice of
Conversion/Continuation, and ending one, two, three, six or (as provided in
Section 2.08(b)) twelve months thereafter, and (2) Money Market Eurodollar
Loan, the period commencing on the date of borrowing specified in the
applicable Notice of Borrowing and ending such whole number of months
thereafter, in each case as selected by the Company, provided that:
(i) any Interest Period (other than an Interest Period
determined pursuant to clause (iii) below) which would otherwise end
on a day which is not a Eurodollar Business Day shall be extended to
the next succeeding Eurodollar Business Day unless such Eurodollar
Business Day falls in another calendar month, in which case such
Interest Period shall end on the next preceding Eurodollar Business
Day;
(ii) any Interest Period (other than an Interest Period
determined pursuant to clause (iii) below) which begins on the last
Eurodollar Business Day of a calendar month (or on a day for which
there is no numerically corresponding day in the calendar month at
the end of such Interest Period) shall end on the last Eurodollar
Business Day of a calendar month; and
(iii) any Interest Period which would otherwise end after the
Commitment Termination Date shall end on the Commitment Termination
Date; and
(b) as to each (1) CD Loan, a period commencing on the date of borrowing
specified in the applicable Notice of Borrowing or on the date specified in
the applicable Notice of Conversion/Continuation and ending 30, 60, 90 or
180 days thereafter, and (2) Money Market Rate Loan, the period commencing
on the date of borrowing specified in the applicable Notice of Borrowing
and ending such number of days thereafter (but not less than seven days),
in each case as selected by the Company; provided that:
(i) any Interest Period (other than an Interest Period
determined pursuant to clause (ii) below) which would otherwise end
on a day which is not a Eurodollar Business Day shall be extended to
the next succeeding Eurodollar Business Day; and
(ii) any Interest Period which would otherwise end after the
Commitment Termination Date shall end on the Commitment Termination
Date.
"Internal Revenue Code" means the Internal Revenue Code of
1986, as amended, or any successor statute.
"Invitation for Money Market Quotes" means the notice
substantially in the form of Exhibit C hereto to the Banks in connection
with the solicitation by the Company of Money Market Quotes.
"Lien" means any mortgage, pledge, security
interest, lien, or encumbrance.
"Loan" and "Loans" mean and include each and every loan made by
a Bank under this Agreement.
"Loral" means Loral Corporation, a New York
corporation, and its successors.
"Material Adverse Effect" means a material adverse effect on
(a) the ability of the Company and the Guarantor, on a consolidated basis,
to perform their obligations under this Agreement or any of the Notes, (b)
the validity or enforceability of this Agreement or any of the Notes, (c)
the rights and remedies of any Bank or the Agents under this Agreement or
any of the Notes, or (d) the timely payment of the principal of or interest
on the Loans or other amounts payable in connection therewith.
"Material Debt" means Debt (other than Debt evidenced by the
Notes) of the Company and/or one or more of its Subsidiaries, arising in
one or more related or unrelated transactions, in an aggregate principal
amount exceeding $100,000,000.
"Merger" means the merger of Acquisition Company
and Loral contemplated by the Merger Agreement.
"Merger Agreement" means the Agreement and Plan of Merger dated
as of January 7, 1996, among the Company, Loral and Acquisition Company.
"Money Market Eurodollar Loan" means a loan to be made by a
Bank pursuant to a Eurodollar Auction (including such a loan bearing
interest at the Base Rate pursuant to Section 8.03).
"Money Market Lending Office" means, as to each Bank, its
Domestic Lending Office or such other office, branch or affiliate of such
Bank as it may hereafter designate as its Money Market Lending Office by
notice to the Company and the Agents; provided that any Bank may from time
to time by notice to the Company and the Administrative Agent designate
separate Money Market Lending Offices for its Money Market Eurodollar
Loans, on the one hand, and its Money Market Rate Loans, on the other hand,
in which case all references herein to the Money Market Lending Office of
such Bank shall be deemed to refer to either or both of such offices, as
the context may require.
"Money Market Loan" means a Money Market
Eurodollar Loan or a Money Market Rate Loan.
"Money Market Margin" has the meaning set forth
in Section 2.03(d).
"Money Market Notes" means promissory notes of the Company,
substantially in the form of Exhibit G-2 hereto, evidencing the obligation
of the Company to repay the Money Market Loans, and "Money Market Note"
means any one of such promissory notes issued hereunder.
"Money Market Quote" means an offer by a Bank, in substantially
the form of Exhibit D hereto, to make a Money Market Loan in accordance
with Section 2.03.
"Money Market Quote Request" means the notice, in substantially
the form of Exhibit B hereto, to be delivered by the Company in accordance
with Section 2.03 in requesting Money Market Quotes.
"Money Market Rate" has the meaning set forth in
Section 2.03(d).
"Money Market Rate Loan" means a Loan to be made by a Bank
pursuant to a Rate Auction.
"Moody's" means Moody's Investors Service, Inc.
and its successors.
"Multiemployer Plan" means at any time an employee pension
benefit plan within the meaning of Section 4001(a)(3) of ERISA to which any
member of the ERISA Group is then making or accruing an obligation to make
contributions.
"Note" or "Notes" has the meaning set forth in Section 2.06.
"Notice of Borrowing" means a Notice of Committed Borrowing (as
defined in Section 2.02) or a Notice of Money Market Borrowing (as defined
in Section 2.03(f)).
"Notice of Conversion/Continuation" has the
meaning set forth in Section 2.05.
"Officer's Certificate" means a certificate
signed by an officer of the Company.
"Original Commitment" means $5,000,000,000.
"Other Taxes" has the meaning set forth in
Section 8.04.
"Parent" means with respect to any Bank, any
Person controlling such Bank.
"Participant" has the meaning set forth in
Section 10.08(b).
"PBGC" means the Pension Benefit Guaranty
Corporation or any entity succeeding to any or all of its
functions under ERISA.
"Person" means any individual, firm, company, corporation,
joint venture, joint-stock company, limited liability company or
partnership, trust, unincorporated organization, government or state
entity, or any association or partnership (whether or not having separate
legal personality) of two or more of the foregoing.
"Plan" means at any time an employee pension benefit plan
(other than a Multiemployer Plan) that is covered by Title IV of ERISA or
subject to the minimum funding standards under Section 412 of the Internal
Revenue Code and is maintained, or contributed to, by any member of the
ERISA Group for employees of any member of the ERISA Group.
"Post-Default Rate" means, with respect to any Loan or any
interest payment at any date on or after the due date of such Loan or
interest payment, a rate per annum equal to the sum of 2% plus the Base
Rate for such date.
"Principal Property" means, at any time, any manufacturing
facility that is located in the United States, is owned by the Company or
any of its Subsidiaries, and has a book value, net of any depreciation or
amortization, pursuant to the then most recently delivered financial
statements, in excess of $5,000,000.
"Quarterly Date" means the last day of March, June, September
and December in each year, commencing June 30, 1996.
"Rate Auction" means a solicitation of Money Market Quotes
setting forth Money Market Rates pursuant to Section 2.03.
"Rating Agency" means either of Moody's or S&P.
"Reference Banks" means the CD Reference Banks or the
Eurodollar Reference Banks, as the context may require, and "Reference
Bank" means any one of such Reference Banks.
"Reference Rate" means the rate of interest publicly announced
by Bank of America National Trust and Savings Association in San Francisco
from time to time as its "reference rate" (which is a rate set by Bank of
America National Trust and Savings Association based on various factors
including its costs and desired return, general economic conditions and
other factors, and is used as a reference point for pricing some loans,
which may be priced at, above or below such announced rate); any change in
the Reference Rate shall take effect on the day specified in the public
announcement of such change.
"Regulation U" means Regulation U of the Board of Governors of
the Federal Reserve System, as in effect from time to time.
"Required Banks" means at any time and for any specific purpose
the Bank or Banks having, in the aggregate, more than 50% of the Total
Commitments, or, if the Commitments have terminated, more than 50% of the
Loans.
"Restricted Subsidiary" means (x) any Significant Subsidiary,
(y) any Subsidiary that has substantially all of its property located in
the United States and that owns a Principal Property and (z) any Subsidiary
theretofore designated a Restricted Subsidiary pursuant to the next
sentence and not subsequently designated not a Restricted Subsidiary
pursuant to the sentence thereafter. If at the end of any fiscal quarter
ending on or after June 30, 1996, the aggregate principal amount of Debt of
the Company and its Subsidiaries secured by Liens exceeds $100,000,000 and
the aggregate total assets (net of depreciation and, amortization, and
after intercompany eliminations, but without giving effect, as to any
Restricted Subsidiary pursuant to clause (z) above, to assets encumbered by
Liens to secure Debt) of the Company and all of its Restricted Subsidiaries
("Total Restricted Assets") are less than 85% of the total assets of the
Company and its Subsidiaries (net of depreciation and amortization, and
after intercompany eliminations, but without giving effect, as to any
Restricted Subsidiary pursuant to clause (z) above, to assets encumbered by
Liens to secure Debt) ("Total Assets"), then the Company shall, not later
than the date on which financial statements for the fiscal period then
ending are required to be delivered pursuant to this Agreement, designate
other Subsidiaries as Restricted Subsidiaries such that, after giving
effect thereto, Total Restricted Assets equal or exceed 85% of Total
Assets. If at the end of any fiscal quarter, Total Restricted Assets are
more than 85% of Total Assets, the Company may designate Restricted
Subsidiaries which are not then Restricted Subsidiaries pursuant to clause
(x) or (y) above as being no longer Restricted Subsidiaries, provided that
after giving effect thereto, Total Restricted Assets equal or exceed 85% of
Total Assets. Subsidiaries of a Restricted Subsidiary are not Restricted
Subsidiaries solely by virtue of such subsidiary status.
"Retiring Bank" has the meaning set forth in
Section 10.01(a).
"S&P" means Standard & Poor's Ratings Group and
its successors.
"Significant Subsidiary" means a Subsidiary with a book value
of total assets, net of depreciation and amortization and after
intercompany eliminations, in excess of $100,000,000.
"Stockholders' Equity" means consolidated stockholders' equity
of the Company and the Consolidated Subsidiaries reported as stockholders'
equity on the consolidated balance sheet of the Company and the
Consolidated Subsidiaries.
"Subsidiary" means any corporation or other entity of which
securities or other ownership interests having ordinary voting power to
elect a majority of the Board of Directors or other persons performing
similar functions are at the time directly or indirectly owned by the
Company, other than any such corporation or other entity that is an Exempt
Subsidiary.
"Taxes" has the meaning set forth in Section 8.04.
"Tender Offer" means the tender offer for shares of Loral
contemplated by the Merger Agreement.
"Total Commitments" means, at the time for any
determination thereof, the aggregate of the Commitments of the Banks.
"Total Usage" means, as to any Bank at any time of
determination, the sum of (i) the aggregate principal amount of all
Committed Loans by such Bank at such time outstanding and (ii) the product
derived by multiplying (a) the aggregate principal amount of all Money
Market Loans at such time outstanding and (b) the quotient derived by
dividing such Bank's Commitment by Total Commitments.
"Transferee" has the meaning set forth in Section 10.08(e).
"United States" means the United States of America, including
the States and the District of Columbia, but excluding the Commonwealths,
territories and possessions of the United States.
"Unfunded Liabilities" means, with respect to any Plan at any
time, the amount (if any) by which (i) the present value of all benefits
under such Plan exceeds (ii) the fair market value of all Plan assets
allocable to such benefits (excluding any accrued but unpaid
contributions), all determined as of the then most recent valuation date
for such Plan, but only to the extent that such excess represents a
potential liability of a member of the ERISA Group to the PBGC or an
appointed trustee under Title IV of ERISA.
SECTION 1.02. Accounting Terms and Determinations. Unless
otherwise specified herein, all accounting terms used herein shall be
interpreted, all accounting determinations hereunder shall be made, and all
financial statements required to be delivered hereunder shall be prepared
in accordance with generally accepted accounting principles as in effect
from time to time applied on a basis consistent (except for changes
concurred in by the Company's independent public accountants) with the most
recent audited consolidated financial statements of the Company and its
Consolidated Subsidiaries delivered to the Banks; provided that, if the
Company notifies the Documentation Agent that the Company wishes to amend
any covenant contained in Article V to eliminate the effect of any change
after the date hereof in generally accepted accounting principles (which,
for purposes of this proviso shall include the generally accepted
application or interpretation thereof) on the operation of such covenant
(or if the Documentation Agent notifies the Company that the Required Banks
wish to amend any such covenant for such purpose), then the Company's
compliance with such covenant shall be determined on the basis of generally
accepted accounting principles in effect immediately before the relevant
change in generally accepted accounting principles is adopted by the
Company, until either such notice is withdrawn or such covenant is amended
in a manner satisfactory to the Company and the Required Banks.
ARTICLE II
THE LOANS
SECTION 2.01. The Committed Loans. On or after the Closing Date
each of the Banks severally agrees, upon the terms and conditions of this
Agreement, to make Loans to the Company under this Section 2.01 from time
to time prior to the Commitment Termination Date or the termination in full
of such Bank's Commitment, whichever is earlier, such that the Total Usage
at any time shall not exceed such Bank's Commitment in effect at such time.
Within such limits, the Company may borrow, repay and reborrow under this
Section 2.01. Each borrowing from the Banks shall be in an aggregate amount
of not less than $10,000,000 and in multiples of $1,000,000.
SECTION 2.02. Method of Committed Borrowing. The Company shall
give the Administrative Agent written or telephonic notice (a "Notice of
Committed Borrowing") no later than 1:00 p.m. (New York time) or, with
respect to any Base Rate Loan, 11:00 a.m. (New York time) (i) at least
three Eurodollar Business Days before the date of each borrowing hereunder
on the basis of the Eurodollar Rate (or at least four Eurodollar Business
Days before the date of a borrowing hereunder with an Interest Period of
twelve months in accordance with Section 2.08(b)), (ii) at least two
Domestic Business Days before the date of each borrowing hereunder on the
basis of the Adjusted CD Rate and (iii) on the day of each borrowing
hereunder on the basis of the Base Rate, specifying in each case the date
of such borrowing, which shall be a Domestic Business Day in the case of a
Domestic Loan or a Eurodollar Business Day in the case of a Eurodollar
Loan, the amount to be borrowed, any election as between the Base Rate, the
Adjusted CD Rate and the Eurodollar Rate, and, if the Eurodollar Rate or
Adjusted CD Rate is elected, a selection of the applicable Interest Period.
A written Notice of Committed Borrowing shall be executed by an officer or
a Designated Representative and shall be substantially in the form of
Exhibit A hereto. A telephonic notice hereunder may only be provided by an
officer or a Designated Representative, such notice to be promptly followed
by a written Notice of Committed Borrowing executed as set forth above.
SECTION 2.03. Money Market Borrowings.
(a) In addition to Committed Loans pursuant to Section 2.01,
the Company may, as set forth in this Section 2.03 from time to time prior
to the Commitment Termination Date or earlier termination of the
Commitments, request the Banks to make offers to make Money Market Loans to
the Company, but only to the extent that any such Money Market Loans
together with all other outstanding Loans do not exceed the Total
Commitments. Such Banks may, but shall have no obligation to, make such
offers and the Company may, but shall have no obligation to, accept any
such offers in the manner set forth in this Section.
(b) When the Company wishes to request offers to make Money
Market Loans under this Section, it shall transmit to the Administrative
Agent by facsimile transmission a Money Market Quote Request so as to be
received no later than 1:00 p.m. (New York time) on (x) the fourth
Eurodollar Business Day prior to the date of the Loan proposed therein, in
the case of a Eurodollar Auction or (y) the Domestic Business Day next
preceding the date of the Loan proposed therein, in the case of a Rate
Auction (or, in either case, such other time or date as the Company and the
Administrative Agent shall have mutually agreed and shall have notified the
Banks not later than the date of the Money Market Quote Request for the
first Eurodollar Auction or Rate Auction for which such change is to be
effective) specifying:
(i) the proposed funding date of such Loan, which shall be a
Eurodollar Business Day in the case of a Eurodollar Auction or a
Domestic Business Day in the case of a Rate Auction,
(ii) the aggregate amount of such Loan, which
shall be $10,000,000 or a larger multiple of
$1,000,000,
(iii) the duration of the Interest Period
applicable thereto, subject to the provisions of the
definition of Interest Period,
(iv) the interest payment date or dates
applicable thereto, and
(v) whether the Money Market Quotes requested are to set forth
a Money Market Margin or a Money Market Rate.
The Company may request offers to make Money Market Loans for more than one
Interest Period in a single Money Market Quote Request.
(c) Promptly upon receipt of a Money Market Quote Request, the
Administrative Agent shall send to the Banks by facsimile transmission an
Invitation for Money Market Quotes, which shall constitute an invitation by
the Company to each such Bank to submit Money Market Quotes offering to
make the Money Market Loans to which such Money Market Quote Request
relates in accordance with this Section.
(d)(i) Each Bank may submit a Money Market Quote containing an
offer or offers to make Money Market Loans in response to any Invitation
for Money Market Quotes. Each Money Market Quote must comply with the
requirements of this subsection (d) and must be submitted to the
Administrative Agent by facsimile transmission at its offices specified on
the signature pages hereto not later than (x) 10:45 a.m. (New York time) on
the third Eurodollar Business Day prior to the proposed date of borrowing,
in the case of a Eurodollar Auction or (y) 9:15 a.m. (New York time) on the
proposed date of borrowing, in the case of a Rate Auction (or, in either
case, such other time or date as the Company and the Administrative Agent
shall have mutually agreed and shall have notified the Banks not later than
the date of the Money Market Quote Request for the first Eurodollar Auction
or Rate Auction for which such change is to be effective); provided that
Money Market Quotes submitted by the Administrative Agent (or any affiliate
of the Administrative Agent) in the capacity of a Bank may be submitted,
and may only be submitted, if the Administrative Agent or such affiliate in
the capacity of a Bank notifies the Administrative Agent of the terms of
the offer or offers contained therein not later than 15 minutes prior to
the deadline for the other Banks. Subject to Articles III and VI, any Money
Market Quote so made shall be irrevocable except with the written consent
of the Administrative Agent given on the instructions of the Company.
(ii) Each Money Market Quote shall specify:
(A) the proposed date of borrowing,
(B) the principal amount of the Money Market Loan for which
each such offer is being made, which principal amount (w) may be
greater than or less than the Commitment of the quoting Bank, (x)
must be $5,000,000 or a larger multiple of $1,000,000, (y) may not
exceed the principal amount of Money Market Loans for which offers
were requested and (z) may be subject to an aggregate limitation as
to the principal amount of Money Market Loans for which offers being
made by such quoting Bank may be accepted,
(C) in the case of a Eurodollar Auction, the margin above or
below the applicable Eurodollar Rate (the "Money Market Margin")
offered for each such Money Market Loan, expressed as a percentage
(specified to the nearest 1/10,000th of 1%) to be added to or
subtracted from such Eurodollar Rate,
(D) in the case of a Rate Auction, the rate of interest per
annum (specified to the nearest 1/10,000th of 1%) (the "Money Market
Rate") offered for each such Money Market Loan, and
(E) the identity of the quoting Bank.
A Money Market Quote may set forth up to five separate offers by the
quoting Bank with respect to each Interest Period specified in the related
Invitation for Money Market Quotes.
(iii) Any Money Market Quote shall be disregarded
if it:
(A) is not substantially in conformity with
Exhibit D hereto or does not specify all of the
information required by subsection(d)(ii);
(B) contains qualifying, conditional or similar
language;
(C) proposes terms other than or in addition to those set forth
in the applicable Invitation for Money Market Quotes; or
(D) arrives after the time set forth in subsection (d)(i).
(e) The Administrative Agent shall promptly notify the Company
of the terms (x) of any Money Market Quote submitted by a Bank that is in
accordance with subsection (d) and (y) of any Money Market Quote that
amends, modifies or is otherwise inconsistent with a previous Money Market
Quote submitted by such Bank with respect to the same Money Market Quote
Request. Any such subsequent Money Market Quote shall be disregarded by the
Administrative Agent unless such subsequent Money Market Quote is submitted
solely to correct a manifest error in such former Money Market Quote. The
Administrative Agent's notice to the Company shall specify (A) the
aggregate principal amount of Money Market Loans for which offers have been
received for each Interest Period specified in the related Money Market
Quote Request, (B) the respective principal amounts and Money Market
Margins or Money Market Rates, as the case may be, so offered and (C), if
applicable, any limitations on the aggregate principal amount of Money
Market Loans for which offers in any single Money Market Quote may be
accepted.
(f) Not later than (x) 1:00 p.m. (New York time) on the third
Eurodollar Business Day prior to the proposed date of borrowing, in the
case of a Eurodollar Auction, or (y) 11:00 a.m. (New York time) on the
proposed date of borrowing, in the case of a Rate Auction (or, in either
case, such other time or date as the Company and the Administrative Agent
shall have mutually agreed and shall have notified to the Banks not later
than the date of the Money Market Quote Request for the first Eurodollar
Auction or Rate Auction for which such change is to be effective), the
Company shall notify the Administrative Agent by telephonic notice of its
acceptance or non-acceptance of the offers so notified to it pursuant to
subsection (e). A telephonic notice hereunder may only be provided by an
officer or a Designated Representative. In the case of acceptance, such
telephonic notice shall be promptly followed by a written notice executed
by an officer or a Designated Representative (a "Notice of Money Market
Borrowing"), substantially in the form of Exhibit E hereto, specifying the
aggregate principal amount of offers for each Interest Period that are
accepted. The Company may accept any Money Market Quote in whole or in
part; provided that:
(i) the aggregate principal amount of each borrowing of Money
Market Loans may not exceed the applicable amount set forth in the
related Money Market Quote Request,
(ii) the principal amount of each borrowing of
Money Market Loans must be $10,000,000 or a larger
multiple of $1,000,000,
(iii) acceptance of offers may only be made on the basis of
ascending Money Market Margins or Money Market Rates, as the case may
be, and
(iv) the Company may not accept any offer that is described in
subsection (d)(iii) or that otherwise fails to comply with the
requirements of this Agreement.
(g) If offers are made by two or more Banks with the same Money
Market Margins or Money Market Rates, as the case may be, for a greater
aggregate principal amount than the amount in respect of which such offers
are accepted for the related Interest Period, the principal amount of Money
Market Loans in respect of which such offers are accepted shall be
allocated by the Administrative Agent among such Banks as nearly as
possible (in multiples of $1,000,000, as the Administrative Agent may deem
appropriate) in proportion to the aggregate principal amounts of such
offers. Determinations by the Administrative Agent of the amounts of Money
Market Loans shall be conclusive in the absence of manifest error.
SECTION 2.04. Notice to Banks; Funding of Loans. (a) Upon
receipt of a Notice of Borrowing, the Administrative Agent shall give each
Bank prompt notice of each such borrowing, specifying the relevant
information including such Bank's portion of such borrowing (if any) and
the date on which funds are to be made available. If a Notice of Borrowing
is revoked by the Company after receipt thereof by the Administrative
Agent, the Company shall be subject to the provisions of Section 2.14.
(b) Not later than 1:00 p.m. (New York time) on the date
specified by the Administrative Agent pursuant to Section 2.04(a), each
Bank participating therein shall make available its share of such
borrowing, in Dollars, in immediately available funds, to the
Administrative Agent at its address referred to in Section 10.02. Unless
(i) the Administrative Agent has not received a written Notice of Borrowing
pursuant to Section 2.02 or 2.03(f) or (ii) the Administrative Agent
determines that any applicable condition set forth in Article III has not
been satisfied, the amounts so received by the Administrative Agent shall
be made available immediately upon receipt, but not later than 4:00 p.m.
(New York time) on such date, to the Company by wire transfer in Dollars,
in immediately available funds, to an account of the Company maintained at
a financial institution located in the United States designated by the
Company to the Administrative Agent.
(c) Unless the Administrative Agent shall have received notice
from a Bank at least one Domestic Business Day prior to the date of the
borrowing that such Bank will not make available to the Administrative
Agent such Bank's share of the borrowing, the Administrative Agent may
assume that such Bank has made such share available to the Administrative
Agent on the date of the borrowing in accordance with subsection (b) of
this Section 2.04 and the Administrative Agent may, in reliance upon such
assumption, make available to the Company on such date a corresponding
amount. If and to the extent that such Bank shall not have so made such
share available to the Administrative Agent, such Bank and the Company
severally agree to repay to the Administrative Agent forthwith on demand
such corresponding amount together with interest thereon, for each day from
the date such amount is made available to the Company until the date such
amount is repaid to the Administrative Agent, at the Federal Funds Rate. If
such Bank shall repay to the Administrative Agent such corresponding
amount, such amount so repaid shall constitute such Bank's Loan for
purposes of this Agreement, and the Company shall not be required to repay
such amount pursuant to this subsection (c).
(d) The failure of any Bank to make a Loan required to be made
by it as part of any borrowing hereunder shall not relieve any other Bank
of its obligation, if any, hereunder to make its Loan on the date of such
borrowing, but no Bank shall be responsible for the failure of any other
Bank to make the Loan to be made by such other Bank on the date of the
borrowing.
(e) If any Bank shall fail to make any Loan (the "Failed Loan")
which such Bank is otherwise obligated hereunder to make to the Company on
the date of borrowing thereof and the Agents shall not have received notice
from the Company or such Bank that any condition precedent to the making of
the Failed Loan has not been satisfied, then, until such Bank shall have
made or be deemed to have made (pursuant to the last sentence of this
subsection (e)) the Failed Loan in full or the Documentation Agent shall
have received notice from the Company or such Bank that any condition
precedent to the Failed Loan was not satisfied at the time the Failed Loan
was to have been made, whenever the Administrative Agent shall receive any
amount from the Company for the account of such Bank, (i) the amount so
received will, upon receipt by the Administrative Agent, be deemed to have
been paid to the Bank in satisfaction of the obligation for which paid,
without actual disbursement of such amount to the Bank, (ii) the Bank will
be deemed to have made the same amount available to the Administrative
Agent for disbursement as a Loan to the Company up to the amount of such
Failed Loan and (iii) the Administrative Agent will, accordingly, disburse
such amount (up to the amount of the Failed Loan) to the Company or, if the
Administrative Agent has previously made such amount available to the
Company on behalf of such Bank pursuant to the provisions hereof, reimburse
itself (up to the amount of the amount made available to the Company);
provided, however, that the Administrative Agent shall have no obligation
to disburse any such amount to the Company or otherwise apply it or deem it
applied as provided herein unless the Administrative Agent shall have
determined in its sole discretion that to so disburse such amount will not
violate any law, rule, regulation or requirement applicable to the
Administrative Agent. Upon any such disbursement by the Administrative
Agent, such Bank shall be deemed to have made a Base Rate Loan to the
Company in satisfaction, to the extent thereof, of such Bank's obligation
to make the Failed Loan. If and during the time that a Failed Loan shall
exist, the Company shall have the right to terminate in full the Commitment
of the Bank causing such Failed Loan as provided in Section 10.01(a).
SECTION 2.05. Conversion/Continuation of Loans. (a) With
respect to Committed Loans, the Company shall have the option to (i)
convert all or any part of (A) outstanding Base Rate Loans equal to
$10,000,000 and multiples of $1,000,000 in excess of that amount to
Eurodollar Loans or CD Loans and (B) outstanding Eurodollar Loans equal to
$10,000,000 and multiples of $1,000,000 in excess of that amount to Base
Rate Loans or CD Loans and (C) outstanding CD Loans equal to $10,000,000
and multiples of $1,000,000 in excess of that amount to Base Rate Loans or
Eurodollar Loans, or (ii) upon the expiration of any Interest Period
applicable to outstanding Eurodollar Loans or CD Loans, to continue all or
any portion of such Loans equal to $10,000,000 and multiples of $1,000,000
in excess of that amount as Eurodollar Loans or CD Loans, as the case may
be. The Interest Period of any Base Rate Loan, Eurodollar Loan or CD Loan
converted to a Fixed Rate Loan pursuant to clause (i) above shall commence
on the date of such conversion. The succeeding Interest Period of any Fixed
Rate Loan continued pursuant to clause (ii) above shall commence on the
last day of the Interest Period of the Loan so continued. Eurodollar Loans
and CD Loans may only be converted on the last day of the then current
Interest Period applicable thereto or on the date required pursuant to
Section 8.03.
(b) The Company shall deliver a written or telephonic notice of
such continuation or conversion (a "Notice of Conversion/Continuation") to
the Administrative Agent no later than (x) 1:00 p.m. (New York time) at
least three Eurodollar Business Days (four Eurodollar Business Days if the
Interest Period is for twelve months) in advance of the date of the
proposed conversion to, or continuation of, a Eurodollar Loan, (y) 1:00
p.m. (New York time) at least two Domestic Business Days in advance of the
date of the proposed conversion to, or continuation of, a CD Loan and (z)
11:00 a.m. (New York time) on the day of a conversion to a Base Rate Loan.
A written Notice of Conversion/Continuation shall be executed by an officer
or a Designated Representative, shall be in substantially the form attached
as Exhibit F and shall specify: (i) the proposed conversion/continuation
date (which shall be a Eurodollar Business Day in the case of a Eurodollar
Loan or a Domestic Business Day in the case of a CD Loan or Base Rate
Loan), (ii) the aggregate amount of the Loans being converted/continued,
(iii) an election between the Base Rate, the Adjusted CD Rate and the
Eurodollar Rate and (iv), in the case of a conversion to, or a continuation
of, CD Loans or Eurodollar Loans, the requested Interest Period. A
telephonic Notice of Conversion/Continuation may only be provided by an
officer or a Designated Representative, which notice must be promptly
followed by a written Notice of Conversion/Continuation executed as set
forth above. Upon receipt of a Notice of Conversion/Continuation, the
Administrative Agent shall give each Bank prompt notice of the contents
thereof and such Bank's pro rata share of all conversions and continuations
requested therein. If no timely Notice of Conversion/Continuation is
delivered by the Company as to any Eurodollar Loan or CD Loan and such Loan
is not repaid by the Company at the end of the applicable Interest Period,
such Loan shall be converted to a Base Rate Loan.
SECTION 2.06. Loan Accounts and Notes.
(a) Except as provided in subsection (b) below, the Committed
Loans and Money Market Loans of each Bank shall be evidenced by a loan
account in the Company's name maintained by such Bank and the
Administrative Agent in the ordinary course of business. Such loan account
maintained by the Administrative Agent shall be conclusive evidence absent
manifest error of the amount of the Loan made by such Bank to the Company,
the interest accrued and payable thereon and all interest and principal
payments made thereon. Any failure so to record or any error in doing so
shall in no way limit or otherwise affect the obligation of the Company
hereunder to pay any amount owing with respect to the Loans.
(b) Upon written request made to the Documentation Agent by a
Bank, the Company shall deliver to the Documentation Agent for such Bank a
single Committed Note and a single Money Market Note, if applicable,
evidencing the Committed Loans and the Money Market Loans, respectively, of
such requesting Bank, payable to the order of each such Bank for the
account of its Applicable Lending Office. Each such Note shall be in
substantially the form of Exhibit G-1 or G-2 hereto, as appropriate. Each
reference in this Agreement to the "Note" or "Notes" of such Bank shall be
deemed to refer to and include any or all of such Notes, as the context may
require.
(c) Upon receipt from the Company of the requesting Bank's
Note, the Documentation Agent shall forward such Note to such Bank. Such
Bank shall record the date and amount of each Loan made by it and the date
and amount of each payment of principal made by the Company with respect
thereto, and may, if such Bank so elects in connection with any transfer or
enforcement of its Note, endorse on the schedule forming a part thereof
appropriate notations to evidence the foregoing information with respect to
each such Loan then outstanding; provided that the failure of any Bank that
has requested a Note to make any such recordation or endorsement shall not
affect the obligations of the Company hereunder or under the Note. Each
Bank that receives a Note from the Company is hereby irrevocably authorized
by the Company to so endorse its Note and to attach to and make a part of
its Note a continuation of any such schedule as and when required.
SECTION 2.07. Payment of Principal. (a) Each Committed Loan
shall fall due and be paid as to principal (i) on the Commitment
Termination Date and (ii) on any date that the aggregate principal amount
of all Loans then outstanding exceeds Total Commitments, but ratably only
to the extent of such excess.
(b) Each Money Market Loan shall fall due and be paid as to
principal on the last day of the Interest Period applicable to such Loan.
SECTION 2.08. Interest. Payment of interest on
the Loans shall be in accordance with the following:
(a) Interest shall, subject to any decrease or increase
pursuant to clause (d) of this Section 2.08, accrue (x) on each Base Rate
Loan for each day at a rate per annum equal to the Base Rate for such day,
(y) on each CD Loan for each day during each period commencing on the first
day of an Interest Period therefor to but excluding the last day of such
Interest Period at a rate per annum equal to the sum of the CD Margin for
such day plus the Adjusted CD Rate applicable to such Interest Period, and
(z) on each Eurodollar Loan for each day during each period commencing on
the first day of an Interest Period therefor to but excluding the last day
of such Interest Period, at a rate per annum equal to the sum of the
Eurodollar Rate for such Interest Period plus the Eurodollar Margin for
such day, all as selected and specified in a notice to the Administrative
Agent furnished pursuant to Section 2.02 or Section 2.05; provided that:
(i) each selection by the Company as between the Base
Rate, the Adjusted CD Rate and the Eurodollar Rate shall be made, as
among the Banks, pro rata in accordance with their respective
Commitments, except as variation from such pro-rationing may be
required by virtue of suspension as to a particular Bank of its
Commitment to make Eurodollar Loans, as contemplated by Section
8.03(a); and
(ii) subject to the other provisions of this Section 2.08,
there may be outstanding hereunder at the same time Committed Loans
(or portions thereof) which are Base Rate Loans, other Committed
Loans (or portions thereof) which are CD Loans and other Committed
Loans (or portions thereof) which are Eurodollar Loans.
(b) If requested to do so by the Company, through the
Administrative Agent, at least six Eurodollar Business Days before the
beginning of any Interest Period applicable to a Eurodollar Loan, each Bank
will advise the Company, through the Administrative Agent, before 10:00
a.m. (New York time) four Eurodollar Business Days preceding the beginning
of such Interest Period, as to whether such Bank consents to the selection
by the Company of a duration of twelve months for such Interest Period. If,
but only if, all of the Banks so consent, the Company shall be entitled to
select a duration of twelve months for such Interest Period pursuant to
Section 2.02 or 2.05.
(c) Interest accrued on a Base Rate Loan shall be paid on each
Quarterly Date and on the Commitment Termination Date. Interest accrued on
a CD Loan or a Eurodollar Loan shall be paid (i) on the last day of the
Interest Period for such Loan, (ii) in the case of a Eurodollar Loan with
an Interest Period of twelve months, on the date which is six months from
the first day of such Interest Period and (iii) on the date of any
prepayment pursuant to Section 2.09 or conversion pursuant to Section 8.03
(but only to the extent accrued with respect to the amount being prepaid or
converted). Interest accrued on a Money Market Loan shall be paid on the
last day of the Interest Period for such Loan, the date of any prepayment
pursuant to Section 2.09 or conversion pursuant to Section 8.03 or as
provided in the Money Market Quote Request for such Loan.
(d) Each of the CD Margin and the Eurodollar Margin shall be
determined by reference to the senior unsecured long-term debt ratings of
the Company, or the senior unsecured long-term debt ratings of the Company
(as guaranteed by the Guarantor), whichever is higher, by S&P and Moody's,
as specified on Schedule I hereto. Any change in the CD Margin or the
Eurodollar Margin, as applicable, shall become effective on the day on
which such a Rating Agency shall publicly announce a change in such rating.
(e) Subject to Section 8.03, each Money Market Eurodollar Loan
shall bear interest on the outstanding principal amount thereof, for the
Interest Period applicable thereto, at a rate per annum equal to the sum of
the Eurodollar Rate for such Interest Period (determined as if the Money
Market Eurodollar Loan were a Eurodollar Loan) plus (or minus) the Money
Market Margin quoted by the Bank making such Loan in accordance with
Section 2.03. Each Money Market Rate Loan shall bear interest on the
outstanding principal amount thereof, for the Interest Period applicable
thereto, at a rate per annum equal to the Money Market Rate quoted by the
Bank making such Loan in accordance with Section 2.03.
(f) Interest on past-due principal and interest shall accrue at
the Post-Default Rate during the period from and including the due date
thereof to but excluding the date that such amount is paid and shall be
payable on demand.
(g) The Administrative Agent shall determine, in accordance
with the provisions of this Agreement, each Base Rate, Eurodollar Rate and
Adjusted CD Rate applicable to the Committed Loans hereunder. The
Administrative Agent shall give prompt notice to the Company and the Banks
of each rate of interest so determined, and its determination thereof shall
be conclusive in the absence of manifest error.
(h) Each Reference Bank agrees to use its best efforts to
furnish quotations to the Administrative Agent by the times such quotations
are required to be furnished hereunder. If any Reference Bank does not
furnish a timely quotation, the Administrative Agent shall determine the
relevant interest rate on the basis of the quotation or quotations
furnished by the remaining Reference Bank or Banks or, if none of such
quotations is available on a timely basis, the provisions of Section 8.02
shall apply.
(i) Interest on Fixed Rate Loans and Base Rate Loans (if the
Federal Funds Rate is the basis for the effective rate of interest) shall
be computed on the basis of a year of 360 days and paid for the actual
number of days elapsed, calculated as to each Interest Period (or period
ending on a repayment date or date of conversion to a CD Loan or a
Eurodollar Loan or prepayment date selected pursuant to Section 2.09 or
required pursuant to Section 8.03) from and including the first day thereof
to but excluding the last day thereof. Interest on Base Rate Loans (if the
Reference Rate is the effective rate of interest) shall be computed on the
basis of a year of 365 or 366 days, as the case may be, and paid for the
actual number of days elapsed, calculated from and including the date of
such Base Rate Loan to but excluding the date of repayment or conversion of
such Loan to a Fixed Rate Loan.
SECTION 2.09. Optional Prepayments. (a) The Company may, upon
notice to the Administrative Agent not later than 11:30 a.m. (New York
time) on the date of such prepayment, prepay Base Rate Loans (without
penalty or premium), or any Money Market Loan bearing interest at the Base
Rate pursuant to Section 8.03 (without penalty or premium), in whole at any
time, or from time to time in part in amounts aggregating not less than
$10,000,000.
(b) Subject to Section 2.14, the Company may, upon at least one
Domestic Business Day's notice (delivered not later than 1:00 p.m. (New
York time)) to the Administrative Agent, in the case of CD Loans, or upon
at least three Eurodollar Business Days' notice to the Administrative
Agent, in the case of Eurodollar Loans, prepay such Loans, in whole at any
time, or from time to time in part in amounts aggregating not less than
$10,000,000, by paying the principal amount to be prepaid together with
accrued interest thereon to the date of prepayment.
(c) Except as provided in subsection (a) above, the Company may
not prepay all or any portion of the principal amount of any Money Market
Loan prior to the maturity thereof.
(d) Upon receipt of a notice of prepayment, the Administrative
Agent shall give each Bank prompt notice of the contents thereof and the
amount of such Bank's Loans being prepaid pursuant thereto.
SECTION 2.10. General Provisions as to Payments.
(a) All payments by the Company of principal, interest,
Facility Fee and other charges under this Agreement shall be made not later
than 2:00 p.m. (New York time) on the date when due, in Dollars, in
immediately available funds, to the Administrative Agent at its address
referred to in Section 10.02. If a Fed-Wire reference or tracer number has
been received, from the Company or otherwise, by the Administrative Agent
by that time the Company will not be penalized for a payment received after
2:00 p.m. (New York time). The Administrative Agent will promptly
distribute to each Bank its ratable share of each such payment received by
the Administrative Agent for the account of the Banks. Whenever any payment
of principal of, or interest on, the Domestic Loans, the Money Market Rate
Loans or of the Facility Fee or any other amounts payable to the Banks
hereunder shall be due on a day which is not a Domestic Business Day, the
date for payment thereof shall be extended to the next succeeding Domestic
Business Day. Whenever any payment of principal of, or interest on, the
Eurodollar Loans or the Money Market Eurodollar Loans shall be due on a day
which is not a Eurodollar Business Day, the date for payment thereof shall
be extended to the next succeeding Eurodollar Business Day unless such
Eurodollar Business Day falls in another calendar month, in which case the
date for payment thereof shall be the next preceding Eurodollar Business
Day. If the date for any payment of principal is extended by operation of
law or otherwise, interest thereon shall be payable for such extended time.
(b) Unless the Administrative Agent shall have received notice
from the Company prior to the date on which any payment is due to the Banks
hereunder that the Company will not make such payment in full, the
Administrative Agent may assume that the Company has made such payment in
full to the Administrative Agent on such date and the Administrative Agent
may, in reliance upon such assumption, cause to be distributed to each Bank
on such due date an amount equal to the amount then due such Bank. If and
to the extent that the Company shall not have so made such payment, each
Bank shall repay to the Administrative Agent forthwith on demand such
amount distributed to such Bank together with interest thereon, for each
day from the date such amount is distributed to such Bank until the date
such Bank repays such amount to the Administrative Agent, at the Federal
Funds Rate.
SECTION 2.11. Fees. Commencing with the earlier of (x) the
Closing Date and (y) April 15, 1996, the Company agrees to pay to the Banks
a facility fee (the "Facility Fee") on the daily average of the Total
Commitments at a rate per annum determined by reference to the senior
unsecured long-term debt ratings of the Company, or the senior unsecured
long-term debt ratings of the Company (as guaranteed by the Guarantor),
whichever is higher, by S&P and Moody's, as specified on Schedule I hereto.
Any change in the Facility Fee shall become effective on the day on which
such a Rating Agency publicly announces a change in such rating. The
Facility Fee shall (i) be computed on the basis of a year of 365 or 366
days for the actual number of days elapsed, (ii) be payable in arrears on
each Quarterly Date during the period from and including the earlier of (x)
the Closing Date and (y) April 15, 1996 to but excluding the Commitment
Termination Date and on the Commitment Termination Date, and (iii) be paid
by the Company to the Administrative Agent for the account of the Banks.
Notwithstanding the foregoing, Facility Fees in respect of the Commitment of
any Bank shall cease to accrue, and accrued but unpaid Facility Fees shall
be payable, on the date (if any) on which such Bank's Commitment is
terminated pursuant hereto.
SECTION 2.12. Reduction or Termination of Commitments.
The Company shall have the right at any time or from time to
time, upon not less than three Domestic Business Days' prior written notice
to the Administrative Agent, to terminate the Commitments of the Banks, in
whole or in part, provided that each partial termination shall be in an
aggregate amount of not less than $25,000,000 and a multiple of $5,000,000,
and shall reduce the respective Commitments of all the Banks
proportionately (the signature pages hereto shall be deemed to be amended
to reflect the reduction in such Commitment). If after giving effect to
such reduction, the aggregate principal amount of the outstanding Loans
exceeds the Commitments as then reduced, the Company shall on such date
ratably prepay the Committed Loans to the extent of such excess, all in
accordance with Section 2.07. The Administrative Agent shall give prompt
written notice to each Bank of each such reduction or termination. The
Commitment of a Bank may also be terminated under the provisions of Section
10.01(a).
SECTION 2.13. Lending Offices. Each Loan shall be made and
maintained by the Applicable Lending Office of each respective Bank.
Subject to the provisions of Sections 8.01, 8.03 and 10.08(d), each Bank
may transfer any Loan to or designate a different office of itself or any
subsidiary or affiliate and such office shall thereupon become an
Applicable Lending Office.
SECTION 2.14. Reimbursement. The Company shall reimburse each
Bank for all reasonable out-of-pocket costs and expenses, including the
cost of any liquidation and redeployment of funds borrowed by such Bank
(but excluding loss of margin for the period after any payment, conversion
or failure to borrow, convert or continue as described herein), in the
event that the Company makes any payment of principal with respect to, or
converts, any Fixed Rate Loan on any day other than the last day of an
Interest Period applicable thereto (pursuant to Section 2.09 or otherwise)
or any borrowing, conversion, continuation or prepayment notified to the
Banks pursuant to Section 2.02, 2.03, 2.05 or 2.09(b) relative to Fixed
Rate Loans shall not be consummated because of the Company's failure to
satisfy one or more of the applicable conditions precedent in Article III
or because the Company fails to borrow, convert, continue or prepay at the
specified time. Any Bank requesting reimbursement from the Company for such
costs and expenses pursuant to this Section 2.14 shall provide the Company
through the Administrative Agent with the calculation of the amount of such
costs and expenses in reasonable detail.
ARTICLE III
CONDITIONS
SECTION 3.01. Conditions to Closing. The closing hereunder
shall occur on the date that each of the following conditions shall have
been satisfied (or waived in accordance with Section 10.07):
(a) Effectiveness. This Agreement shall have
become effective pursuant to Section 10.12.
(b) Account. The Company shall have designated
in writing to the Administrative Agent its account pursuant
to Section 2.04(b).
(c) Signatures. The Company shall have certified the name and
signature of each officer authorized to sign this Agreement and any Notes
on its behalf and each person authorized to give Notices of Borrowing or
give Notices of Conversion/Continuation under this Agreement; and the
Guarantor shall have certified the name and signature of each officer
authorized to sign this Agreement on its behalf. The Banks may conclusively
rely on such certification until they respectively receive notice in
writing to the contrary.
(d) Opinion of Company Counsel. The Agents shall have received
(i) opinions of Miles & Stockbridge, a Professional Corporation, and
O'Melveny & Myers, special counsel for the Company, substantially in the
forms of Exhibits H-1 and H-2 hereto, and (ii) an opinion of the General
Counsel, the Chief Counsel or an Assistant General Counsel of the Company,
substantially in the form of Exhibit H-3 hereto; the Company hereby
expressly instructs each such counsel to prepare such opinion for the
benefit of the Agents and the Banks.
(e) Opinion of Bank Counsel. The Agents shall
have received an opinion of Davis Polk & Wardwell, special
counsel for the Agents, substantially in the form of
Exhibit I hereto.
(f) Proof of Corporate Action. The Company shall have delivered
copies certified by (i) its Secretary or an Assistant Secretary of its
Charter and Bylaws and of all corporate action taken by the Company to
authorize the execution, delivery and performance of this Agreement and the
Notes and the borrowing hereunder and (ii) the Secretary or an Assistant
Secretary of the Guarantor of its Charter and Bylaws and of all corporate
action taken by the Guarantor to authorize the execution, delivery and
performance of this Agreement.
(g) Termination and Payment under Existing Agreements. The
Documentation Agent shall have received evidence reasonably satisfactory to
it regarding the termination of commitments, and payment of amounts due,
under the Loan Agreement dated as of March 15, 1995 among Lockheed Martin
Corporation, the guarantors listed therein, the banks listed therein,
Morgan Guaranty Trust Company of New York, as documentation agent, and Bank
of America National Trust and Savings Association, as administrative agent,
and the Amended and Restated Revolving Credit Agreement dated as of
November 23, 1994 among Loral Corporation, certain banks, Morgan Guaranty
Trust Company of New York, as documentation agent and co-arranger, Chemical
Bank, as administrative agent and co-arranger, and Bank of America
Illinois, as co-agent.
(h) Tender Offer Closing. It shall be the case that, and the
Company shall so certify that, (i) tendered shares shall have been accepted
for payment pursuant to the Tender Offer in accordance with the terms of
the Tender Offer; (ii) the terms and conditions of the Tender Offer shall
be in substance as disclosed to the Banks in the Information Memorandum,
but shall in all events include terms and conditions to the effect that
upon the consummation of the Tender Offer, Acquisition Company shall own
and control the number of shares of Loral's common stock as shall be
necessary to approve the Merger without the affirmative vote or approval of
any other shareholders; and (iii) conditions to the consummation of the
Tender Offer shall have been satisfied and shall not have been waived,
except for conditions (x) not material to the combined entity or the
prospects and timing of the consummation of the Merger and (y) not relating
to the legality, validity or legal effect of the financing contemplated
hereby.
(i) Approvals; Compliance with Laws. It shall be the case that,
the Company shall so certify that, and the Agents shall have received
evidence satisfactory to them that, all necessary licenses, permits and
governmental and third-party filings, consents and approvals for the
Acquisition, including the Merger, have been made or obtained and remain in
full force and effect, except for (x) those not material to the combined
entity or the prospects and timing of the consummation of the Merger, (y)
those not relating to the legality, validity or legal effect of the
financing contemplated hereby and (z) in the case of the Merger, the
approval of the holders of the requisite percentage of shares of Loral's
common stock and the filing of any applicable articles or certificate of
merger.
(j) Fees. The Banks and the Agents shall have received the
fees, as otherwise agreed to by them and the Company, then or theretofore
payable.
SECTION 3.02. Conditions to All Loans. The obligation of each
Bank to make each Loan to be made by it on or after the Closing Date
(including the initial Loan) is subject to the following conditions
precedent:
(a) Events of Default, etc. No Event of Default shall have
occurred and be continuing; and except as otherwise described by the
Company in a writing to the Documentation Agent and waived by the Required
Banks, the representations of the Company in Article IV (other than
Sections 4.05, 4.11, 4.12 and the last sentence of Section 4.04) shall be
true on and as of the date of such Loan with the same force and effect as
if made on and as of such date. Notwithstanding the foregoing, for purposes
of the representations of the Company in Article IV in respect of Loans to
be made on the Closing Date, the limitation in the parenthetical included
in the previous sentence shall not apply.
(b) Company Representation. Each Notice of Borrowing given by
the Company pursuant to Section 2.02 or Section 2.03(f) shall constitute a
representation by the Company as to the satisfaction in respect of such
borrowing of the conditions referred to in Section 3.02(a).
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
The Company represents and warrants (such representations and
warranties when given on the Closing Date to be given after giving effect
to the consummation of the Tender Offer, provided that to the extent given
on the Closing Date with respect to Loral and its Subsidiaries, such
representations and warranties are given only to the knowledge of each
officer of the Company listed as an executive officer in the Company's
annual report on Form 10-K for the year ended December 31, 1995 and each
member of the Company's treasury and legal departments) that:
SECTION 4.01. Corporate Existence and Power. Each of the
Company and its Restricted Subsidiaries is a corporation duly organized and
validly existing under the laws of the state of its incorporation without
limitation on the duration of its existence, is in good standing therein,
and is duly qualified to transact business in all jurisdictions where such
qualification is necessary, except for such jurisdictions where the failure
to be so qualified or licensed will not be reasonably likely to have a
Material Adverse Effect; each of the Company and the Guarantor has
corporate power to enter into and perform this Agreement; and the Company
has the corporate power to borrow and issue Notes as contemplated by this
Agreement.
SECTION 4.02. No Contravention. The execution and delivery by
the Company and the Guarantor of this Agreement and any Notes and the
Merger Agreement and the performance by the Company and the Guarantor of
their respective obligations under this Agreement and any Notes and the
Merger Agreement, do not contravene, or constitute a default under, any
provision of applicable law or regulation or such corporation's Charter, or
Certificate of Incorporation, as the case may be, or Bylaws or any
indenture, agreement, instrument, judgment or order to which the Company or
the Guarantor is a party or by which it or any of its material assets or
properties may be bound or affected which would be reasonably likely to
have a Material Adverse Effect.
SECTION 4.03. Corporate Authorization; Binding Effect. Each of
the Company and the Guarantor has taken all corporate action necessary to
authorize its execution and delivery of this Agreement and any Notes and
the Merger Agreement and the consummation of the transactions contemplated
hereby; this Agreement and any Notes and the Merger Agreement constitute
the valid and binding agreements of the Company and the Guarantor
enforceable against the Company and the Guarantor in accordance with their
respective terms, except to the extent limited by bankruptcy,
reorganization, insolvency, moratorium and other similar laws of general
application relating to or affecting the enforcement of creditors' rights
or by general equitable principles.
SECTION 4.04. Financial Information. The unaudited pro forma
combined condensed balance sheet of the Company and the Consolidated
Subsidiaries (giving effect to the Merger) dated as of December 31, 1995
and the related unaudited pro forma combined condensed statements of
earnings of the Company and the Consolidated Subsidiaries (giving effect to
the Merger) for the fiscal year ended December 31, 1995 contained in the
Information Memorandum (together with the historical consolidated financial
statements (including management's analysis of financial condition and
operating results) of the Company and Loral contained, in respect of the
Company, in the Company's annual report on Form 10-K for the fiscal year
ended December 31, 1995, and, in respect of Loral, in Loral's annual and
quarterly reports on Forms 10-K and 10-Q for the fiscal year ended March
31, 1995 and fiscal quarterly periods ended December 31, 1995,
respectively, collectively referred to as the "Financial Statements"),
furnished to the Banks prior to the execution of this Agreement, present
the pro forma consolidated financial condition of the Company and the
Consolidated Subsidiaries (giving effect to the Merger) as of December 31,
1995, and the pro forma results of their operations for the fiscal year
ended December 31, 1995, based on preliminary estimates, adjustments and
assumptions, which were believed to be reasonable in the circumstances
under which such unaudited pro forma financial statements were prepared.
Since December 31, 1995, there has occurred no change in the consolidated
financial condition of the Company and the Consolidated Subsidiaries
(giving effect to the Merger) which would be reasonably likely to have a
Material Adverse Effect.
SECTION 4.05. Litigation; Taxes. (a) There are no suits,
actions or proceedings pending, or to the knowledge of any member of the
Company's legal department threatened, against or affecting the Company or
any Subsidiary, the adverse determination of which is reasonably likely to
occur, and if so adversely determined would be reasonably likely to have a
Material Adverse Effect. On the date of the initial borrowing hereunder,
there exists (i) no injunction against consummation of the Tender Offer,
(ii) no litigation pending, or to the knowledge of any member of the
Company's legal department threatened, which gives rise to a material
likelihood that the Merger will not be consummated or will be subject to
undue delay, and (iii) no litigation pending, or to the knowledge of any
member of the Company's legal department threatened, other than that as to
which there is not a material likelihood of success, challenging the
legality, validity or legal effect of the financing contemplated hereby.
(b) The Company and each Subsidiary have filed all material tax
returns which to the knowledge of any member of the Company's tax
department were required to be filed and have paid or have adequately
provided for all taxes shown thereon to be due, including interest and
penalties, except for (i) those not yet delinquent, (ii) those the
nonpayment of which would not be reasonably likely to have a Material
Adverse Effect and (iii) those being contested in good faith.
SECTION 4.06. Margin Regulations. No part of
the proceeds of any Loan will be used in a manner which would
violate, or result in a violation of, Regulation U.
SECTION 4.07. Governmental Approvals. No consent, approval,
authorization, permit or license from, or registration or filing with, any
Governmental Authority is required in connection with the making of this
Agreement, with the exception of routine periodic filings made under the
Exchange Act and the filing of International Capital Form CQ-1's.
SECTION 4.08. Pari Passu Obligations. Under applicable United
States laws (including state and local laws) in force at the date hereof,
the claims and rights of the Banks and the Agents against the Company under
this Agreement and the Notes will not be subordinate to, and will rank at
least pari passu with, the claims and rights of any other unsecured
creditors of the Company (except to the extent provided by bankruptcy,
reorganization, insolvency, moratorium or other similar laws of general
application relating to or affecting the enforcement of creditors' rights
and by general principles of equity).
SECTION 4.09. No Defaults. The payment
obligations of the Company and the Restricted Subsidiaries
in respect of any Material Debt are not overdue.
SECTION 4.10. Full Disclosure. All information furnished to the
Banks in writing prior to the date hereof in connection with the
transactions contemplated hereby (including, without limitation, the
Information Memorandum, but subject to the qualifications and limitations
set forth in the Information Memorandum (including, without limitation, in
the pro forma and forecasted financial information)) does not,
collectively, contain any misstatement of a material fact or omit to state
a fact necessary to make the statements contained therein, in the light of
the circumstances under which they were made, not misleading in any
material respect on and as of the date hereof.
SECTION 4.11. ERISA. Each member of the ERISA Group has
fulfilled its obligations under the minimum funding standards of ERISA and
the Internal Revenue Code with respect to each Plan and is in substantial
compliance in all material respects with the presently applicable material
provisions of ERISA and the Internal Revenue Code with respect to each
Plan. No member of the ERISA Group has (i) sought a waiver of the minimum
funding standard under Section 412 of the Internal Revenue Code in respect
of any Plan, (ii) failed to make any contribution or payment to any Plan or
Multiemployer Plan or made any amendment to any Plan which, in either case
has resulted or could result in the imposition of a material Lien or the
posting of a material bond or other material security under ERISA or the
Internal Revenue Code or (iii) incurred any material liability under Title
IV of ERISA other than a liability to the PBGC for premiums under Section
4007 of ERISA.
SECTION 4.12. Environmental Matters. The Financial Statements
described in Section 4.04 provide certain information regarding the current
and potential obligations arising from various consent decrees, cleanup and
abatement orders, and current or potential proceedings pertaining to actual
or alleged soil and water contamination, disposal of hazardous wastes, and
other environmental matters related to properties currently owned by the
Company or its Restricted Subsidiaries, previously owned properties, and
other properties. Since December 31, 1995, environmental matters have not
caused any material adverse change in the consolidated financial condition
of the Company and the Consolidated Subsidiaries from that shown by such
Financial Statements.
In the ordinary course of business, the ongoing operations of
the Company and its Restricted Subsidiaries are reviewed from time to time
to determine compliance with applicable Environmental Laws. Based on these
reviews, to the knowledge of the Company, ongoing operations at the
Principal Properties are currently being conducted in substantial
compliance with applicable Environmental Laws except to the extent that
noncompliance would not be reasonably likely to result in a material
adverse change in the consolidated financial condition of the Company and
the Consolidated Subsidiaries.
ARTICLE V
COVENANTS
From the Closing Date and so long as any Commitments of the
Banks shall be outstanding and until the payment in full of all Loans
outstanding under this Agreement and the performance of all other
obligations of the Company under this Agreement, the Company agrees that,
unless the Required Banks shall otherwise consent in writing:
SECTION 5.01. Information. The Company will
deliver to the Administrative Agent for each of the Banks:
(a) as soon as available and in any event within 60 days after
the end of each of its first three quarterly accounting periods in each
fiscal year, consolidated statements of earnings and cash flows of the
Company and the Consolidated Subsidiaries for the period from the beginning
of such fiscal year to the end of such fiscal period and the related
consolidated balance sheet of the Company and the Consolidated Subsidiaries
as at the end of such fiscal period, all in reasonable detail (it being
understood that delivery of such statements as filed with the Securities
and Exchange Commission shall be deemed to satisfy the requirements of this
subsection) and accompanied by a certificate in the form attached hereto as
Exhibit J signed by a financial officer of the Company stating that such
consolidated financial statements fairly present the consolidated financial
condition and results of operations of the Company and the Consolidated
Subsidiaries as of the end of such period and for the period involved,
subject, however, to year-end audit adjustments, and that such officer has
no knowledge, except as specifically stated, of any Default;
(b) as soon as available and in any event within 120 days after
the end of each fiscal year, consolidated statements of earnings and cash
flows of the Company and the Consolidated Subsidiaries for such year and
the related consolidated balance sheets of the Company and the Consolidated
Subsidiaries as at the end of such year, all in reasonable detail and
accompanied by (i) an opinion of independent public accountants of
recognized standing selected by the Company as to such consolidated
financial statements (it being understood that delivery of such statements
as filed with the Securities and Exchange Commission shall be deemed to
satisfy the requirements of this subsection), and (ii) a certificate in the
form attached hereto as Exhibit J signed by a financial officer of the
Company stating that such consolidated financial statements fairly present
the consolidated financial condition and results of operations of the
Company and the Consolidated Subsidiaries as of the end of such year and
for the year involved and that such officer has no knowledge, except as
specifically stated, of any Default;
(c) promptly after their becoming available:
(i) copies of all financial statements, stockholder reports and
proxy statements that the Company shall have sent to its stockholders
generally; and
(ii) copies of all registration statements filed by the Company
under the Securities Act of 1933, as amended (other than registration
statements on Form S-8 or any registration statement filed in
connection with a dividend reinvestment plan), and regular and
periodic reports, if any, which the Company shall have filed with the
Securities and Exchange Commission (or any governmental agency or
agencies substituted therefor) under Section 13 or Section 15(d) of
the Exchange Act, or with any national or international securities
exchange (other than those on Form 11-K or any successor form);
(d) from time to time, with reasonable promptness, but subject
to restrictions imposed by applicable security clearance regulations, such
further information regarding the business and financial condition of the
Company and its Subsidiaries as any Bank may reasonably request through the
Documentation Agent;
(e) prompt notice of the occurrence of any Default; and
(f) prompt notice of all litigation and of all proceedings
before any governmental or regulatory agency pending (or, to the knowledge
of the General Counsel of the Company, threatened) and affecting the
Company or any Restricted Subsidiary, except litigation or proceedings
which, if adversely determined, would not be reasonably likely to result in
a Material Adverse Effect.
Each set of financial statements delivered pursuant to clause
(a) or clause (b) of this Section 5.01 shall be accompanied by or include
the computations showing, in the form attached hereto as Exhibit J, whether
the Company was, at the end of the relevant fiscal period, in compliance
with the provisions of Section 5.09.
SECTION 5.02. Payment of Obligations. The Company will pay and
discharge, and will cause each Restricted Subsidiary to pay and discharge,
all material taxes, assessments and governmental charges or levies imposed
upon it or upon its income or profits, or upon any property belonging to
it, prior to the date on which penalties attach thereto, and all lawful
material claims which, if unpaid, might become a Lien upon the property of
the Company or such Restricted Subsidiary; provided that neither the
Company nor any such Restricted Subsidiary shall be required to pay any
such tax, assessment, charge, levy or claim (i) the payment of which is
being contested in good faith and by proper proceedings, (ii) not yet
delinquent or (iii) the non-payment of which, if taken in the aggregate,
would not be reasonably likely to result in a Material Adverse Effect.
SECTION 5.03. Insurance. The Company will maintain, and will
cause each Restricted Subsidiary to maintain, insurance from responsible
companies in such amounts and against such risks as is customarily carried
by owners of similar businesses and properties in the same general areas in
which the Company or such Restricted Subsidiary operates or, to the
customary extent, self-insurance.
SECTION 5.04. Maintenance of Existence. The Company will
preserve and maintain, and will cause each Restricted Subsidiary to
preserve and maintain, its corporate existence and all of its rights,
privileges and franchises necessary or desirable in the normal conduct of
its business, and conduct its business in an orderly, efficient and regular
manner. Nothing herein contained shall prevent the termination of the
business or corporate existence of any Subsidiary (other than the
Guarantor) which in the judgment of the Company is no longer necessary or
desirable, a merger or consolidation of a Subsidiary into or with the
Company (if the Company is the surviving corporation) or another Subsidiary
or any merger, consolidation or transfer of assets permitted by Section
5.07, as long as immediately after giving effect to any such transaction,
no Default shall have occurred and be continuing.
SECTION 5.05. Maintenance of Properties. The Company will keep,
and will cause each Restricted Subsidiary to keep, all of its properties
necessary, in the judgment of the Company, in its business in good working
order and condition, ordinary wear and tear excepted. Nothing in this
Section 5.05 shall prevent the Company or any Restricted Subsidiary from
discontinuing the operation or maintenance, or both the operation and
maintenance, of any properties of the Company or any such Restricted
Subsidiary if such discontinuance is, in the judgment of the Company (or
such Restricted Subsidiary), desirable in the conduct of its business.
SECTION 5.06. Compliance With Laws. The Company will comply,
and will cause each Restricted Subsidiary to comply, with the requirements
of all applicable laws, rules, regulations, and orders of any Governmental
Authority, a breach of which would be reasonably expected to have a
Material Adverse Effect, except where contested in good faith and by proper
proceedings.
SECTION 5.07. Mergers, Consolidations and Sales
of Assets.
(a) Neither the Company nor the Guarantor shall consolidate
with or merge into any other Person or convey or transfer its properties
and assets substantially as an entirety to any Person, unless:
(1) the Company or a Consolidated Subsidiary that is
incorporated under the laws of the United States, any state thereof
or the District of Columbia is the surviving corporation of any such
consolidation or merger or is the Person that acquires by conveyance
or transfer the properties and assets of the Company or the Guarantor
substantially as an entirety;
(2) if a Consolidated Subsidiary is the surviving
corporation or is the Person that acquires the property and assets of
the Company or the Guarantor substantially as an entirety, it shall
expressly assume the performance of every covenant of this Agreement
and of the Notes on the part of the Company or the Guarantor, as the
case may be, to be performed or observed;
(3) immediately after giving effect to such transaction,
no Default shall have occurred and be continuing; and
(4) if the Company or the Guarantor, as the case may be,
is not the surviving corporation, the Company has delivered to the
Documentation Agent an Officer's Certificate and a legal opinion of
its General Counsel, Chief Counsel or Assistant General Counsel, upon
the express instruction of the Company for the benefit of the
Documentation Agent and the Banks, each stating that such transaction
complies with this Section and that all conditions precedent herein
provided for relating to such transaction have been complied with.
(b) Upon any consolidation by the Company or the Guarantor
with, or merger by the Company or the Guarantor into, a Consolidated
Subsidiary or any conveyance or transfer of the properties and assets of
the Company or the Guarantor substantially as an entirety to a Consolidated
Subsidiary, the Consolidated Subsidiary into which the Company or the
Guarantor is merged or consolidated or to which such conveyance or transfer
is made shall succeed to, and be substituted for, and may exercise every
right and power of, the Company or the Guarantor, as the case may be, under
this Agreement with the same effect as if such Consolidated Subsidiary had
been named as the Company or the Guarantor, as the case may be, herein, and
thereafter, in the case of a transfer or conveyance permitted by Section
5.07(a), the Company or the Guarantor, as the case may be, shall be
relieved of all obligations and covenants under this Agreement and the
Notes.
This covenant shall not, so long as the common stock of Loral
is "margin stock" within the meaning of Regulation U, apply to any sale of
such stock for value.
SECTION 5.08. Limitation on Liens. The Company will not, and
will not permit any Restricted Subsidiary to, create or suffer to exist any
Lien upon any of its assets, now owned or hereafter acquired, securing any
Debt; provided, however, that the foregoing restrictions shall not apply
to:
(a) Liens on any assets owned by the Company or any Restricted
Subsidiary existing at the date of this Agreement;
(b) Liens on assets of a corporation or other entity existing
at the time such corporation or other entity is merged into or consolidated
with the Company or a Restricted Subsidiary (to the extent applicable, in
accordance with Section 5.07), or at the time of a purchase, lease or other
acquisition of the assets of a corporation or other entity as an entirety
or substantially as an entirety by the Company or a Restricted Subsidiary,
whether or not any indebtedness secured by such Liens is assumed by the
Company or such Restricted Subsidiary;
(c) Liens on assets of a corporation or other entity existing
at the time such corporation or other entity becomes a Restricted
Subsidiary;
(d) Liens securing Debt of a Restricted Subsidiary owing to
the Company or to another Restricted Subsidiary;
(e) materialmen's, suppliers', tax or other similar Liens
arising in the ordinary course of business securing obligations which are
not overdue or are being contested in good faith by appropriate
proceedings; and Liens arising by operation of law in favor of any lender
to the Company or any Restricted Subsidiary in the ordinary course of
business constituting a banker's lien or right of offset in moneys of the
Company or a Restricted Subsidiary deposited with such lender in the
ordinary course of business;
(f) Liens on assets existing at the time of acquisition of such
assets by the Company or a Restricted Subsidiary, or Liens to secure the
payment of all or any part of the purchase price of assets upon the
acquisition of such assets by the Company or a Restricted Subsidiary or to
secure any Debt incurred or guaranteed by the Company or a Restricted
Subsidiary prior to, at the time of, or within one year after the later of
the acquisition, completion of construction (including any improvements on
an existing asset) or commencement of full operation of such asset, which
Debt is incurred or guaranteed for the purpose of financing all or any part
of the purchase price thereof or construction or improvements thereon, and
which Debt may be in the form of obligations incurred in connection with
industrial revenue bonds or similar financings and letters of credit issued
in connection therewith; provided, however, that in the case of any such
acquisition, construction or improvement the Lien shall not apply to any
asset theretofore owned by the Company or a Restricted Subsidiary, other
than, in the case of any such construction or improvement, any theretofore
unimproved real property on which the property so constructed or the
improvement made is located;
(g) Liens in favor of any customer (including any Governmental
Authority) to secure partial, progress, advance or other payments or
performance pursuant to any contract or statute or to secure any related
indebtedness or to secure Debt guaranteed by a Governmental Authority;
(h) Liens on cash or certificates of deposit or other bank
obligations in an amount substantially equal in value (at the time such
Liens are created) to, and securing, indebtedness in an aggregate principal
amount not in excess of $200,000,000 (or the equivalent amount in a
different currency);
(i) Liens equally and ratably securing the Loans and such Debt;
provided that the Required Banks may, in their sole discretion, refuse to
take any Lien on any asset (which refusal will not limit the Company's or
any Restricted Subsidiary's ability to incur a Lien otherwise permitted by
this Section 5.08(i)); such Lien may equally and ratably secure the Loans
and any other obligation of the Company or any of its Subsidiaries, other
than an obligation that is subordinated to the Loans;
(j) any extension, renewal or replacement (or successive
extensions, renewals or replacements) in whole or in part of any Lien
referred to in the foregoing; provided, however, that the principal amount
of Debt secured thereby shall not exceed the principal amount of Debt so
secured at the time of such extension, renewal or replacement, and that
such extension, renewal or replacement shall be limited to all or part of
the asset which secured the Lien so extended, renewed or replaced (plus
improvements and construction on such asset); and
(k) Liens securing Debt in an aggregate amount that, together
with all other Debt of the Company and its Restricted Subsidiaries that is
secured by Liens not otherwise permitted under subsections (a) through (j)
above (if originally issued, assumed or guaranteed at such time), does not
at the time exceed the greater of 10% of Stockholders' Equity as of the end
of the fiscal quarter preceding the date of determination or
$1,000,000,000. For purpose of this Section 5.08(k), the term "Consolidated
Subsidiaries" in the definition of Stockholders' Equity includes any Exempt
Subsidiaries.
The exceptions to the Lien limitations described in clauses
(b), (c) and (f) above shall not apply to Liens on any stock or assets of
Loral or any of its subsidiaries incurred in contemplation of the
Acquisition.
This covenant shall not apply to any "margin stock" within the
meaning of Regulation U in excess of 25% in value of the assets covered by
this covenant.
For the avoidance of doubt, the creation of a security interest
arising solely as a result of, or the filing of UCC financing statements in
connection with, any sale by the Company or any of its Subsidiaries of
accounts receivable not prohibited by Section 5.07 shall not constitute a
Lien prohibited by this covenant.
SECTION 5.09. Leverage Ratio. The Company will not permit, as
of the last day of any fiscal quarter, the ratio of (a) Debt to (b) the sum
of Debt and Stockholders' Equity, to exceed: (i) for quarters ending on or
before December 30, 1996, 72.5% and (ii) for quarters ending on or after
December 31, 1996, 67.5%. For purposes of this Section 5.09, the term
"Consolidated Subsidiaries" in the definitions of Debt and Stockholders'
Equity includes any Exempt Subsidiaries.
SECTION 5.10. Use of Loans. The Company will use the proceeds
of the Loans to finance the Acquisition and for any other lawful corporate
purposes of the Company.
ARTICLE VI
DEFAULTS
SECTION 6.01. Events of Default. If one or more of the
following events ("Events of Default") shall have occurred and be
continuing:
(a) the Company shall fail to pay the principal of any
Loan when due;
(b) the Company shall fail to pay within 5 days of the
due date thereof (i) any Facility Fee or (ii) interest on any Loan;
(c) the Company shall fail to pay within 30 days after written
request for payment by any Bank acting through the Administrative Agent any
other amount payable under this Agreement;
(d) the Company shall fail to observe or perform any agreement
contained in Sections 5.07 through 5.09;
(e) the Company shall fail to observe or perform any covenant
or agreement contained in this Agreement (other than those covered by
clauses (a) through (d) above) for 30 days after written notice thereof has
been given to the Company by the Documentation Agent at the request of the
Required Banks;
(f) any representation or warranty made by the Company in
Article IV of this Agreement or any certificate or writing furnished
pursuant to this Agreement shall prove to have been incorrect in any
material respect when made and such deficiency shall remain unremedied for
5 days after written notice thereof shall have been given to the Company by
the Documentation Agent at the request of the Required Banks;
(g) any Material Debt shall become due before stated maturity
by the acceleration of the maturity thereof by reason of default, or any
Material Debt shall become due by its terms and shall not be paid and, in
any case aforesaid in this clause (g), corrective action satisfactory to
the Required Banks shall not have been taken within 5 days after written
notice of the situation shall have been given to the Company by the
Documentation Agent at the request of the Required Banks;
(h) the Company or any Restricted Subsidiary shall commence a
voluntary case or other proceeding seeking liquidation, reorganization or
other relief with respect to itself or its debts under any bankruptcy,
insolvency or other similar law now or hereafter in effect or seeking the
appointment of a trustee, receiver, liquidator, custodian or other similar
official of it or any substantial part of its property, or shall consent to
any such relief or to the appointment of or taking possession by any such
official in an involuntary case or other proceeding commenced against it,
or shall make a general assignment for the benefit of creditors, or shall
fail generally to pay its debts as they become due, or shall take any
corporate action to authorize any of the foregoing;
(i) an involuntary case or other proceeding shall be commenced
against the Company or any Restricted Subsidiary seeking liquidation,
reorganization or other relief with respect to it or its debts under any
bankruptcy, insolvency or other similar law now or hereafter in effect or
seeking the appointment of a trustee, receiver, liquidator, custodian or
other similar official of it or any substantial part of its property, and
such involuntary case or other proceeding shall remain undismissed and
unstayed for a period of 90 days; or an order for relief shall be entered
against the Company or any Restricted Subsidiary under the federal
bankruptcy laws as now or hereafter in effect;
(j) a final judgment for the payment of money in excess of
$150,000,000 shall have been entered against the Company or any Restricted
Subsidiary, and the Company or such Restricted Subsidiary shall not have
satisfied the same within 60 days, or caused execution thereon to be stayed
within 60 days, and such failure to satisfy or stay such judgment shall
remain unremedied for 5 days after notice thereof shall have been given to
the Company by the Documentation Agent at the request of the Required
Banks;
(k) a final judgment either (1) requiring termination or
imposing liability (other than for premiums under Section 4007 of ERISA)
under Title IV of ERISA in respect of, or requiring a trustee to be
appointed under Title IV of ERISA to administer, any Plan or Plans having
aggregate Unfunded Liabilities in excess of $150,000,000 or (2) in an
action relating to a Multiemployer Plan involving a current payment
obligation in excess of $150,000,000, which judgment, in either case, has
not been satisfied or stayed within 60 days and such failure to satisfy or
stay is unremedied for 5 days after notice thereof shall have been given to
the Company by the Documentation Agent at the request of the Required
Banks;
(l) during any two-year period, individuals who at the
beginning of such period constituted the Company's Board of Directors (or,
if such two-year period commences on or before February 6, 1995, the
directors of the Company specified in the Joint Proxy Statement/Prospectus
dated February 9, 1995, of Lockheed Corporation, Martin Marietta
Corporation and the Company) (together with any new director whose election
by the Board of Directors or whose nomination for election by the
stockholders of the Company was approved by a vote of at least two-thirds
of the directors then in office who either were directors at the beginning
of such period or whose election or nomination for election was previously
so approved) cease for any reason to constitute a majority of the directors
then in office;
(m) any person or group of persons (within the meaning of
Section 13 or 14 of the Exchange Act) (other than an employee benefit or
stock ownership plan of the Company or any of its Subsidiaries) shall have
acquired, directly or indirectly, shares of capital stock (whether common
or preferred or a combination thereof) having ordinary voting power to
elect a majority of the members of the Board of Directors of the Company;
or
(n) the guarantee set forth in Section 9.01, for any reason
other than payment in full of all amounts due hereunder following
termination of all Commitments or a transaction permitted by Section 5.07
in which the Guarantor and the Company merge and either is the surviving
entity, ceases to be in full force and effect (including with respect to
future Loans), is revoked or is declared null and void, or the Guarantor
denies that it has or contests any further liability under Article IX, or
gives notice to such effect;
then, and in every such event, the Documentation Agent shall, if requested
by the Required Banks, (i) by notice to the Company terminate the
Commitments and they shall thereupon terminate, and (ii) by notice to the
Company declare the Loans, interest accrued thereon and all other amounts
payable hereunder to be, and the same shall thereupon become, immediately
due and payable without presentment, demand, protest or other notice of any
kind, all of which are hereby waived by the Company; provided that in the
event of (A) the filing by the Company of a petition, or (B) an actual or
deemed entry of an order for relief with respect to the Company, under the
federal bankruptcy laws as now or hereafter in effect, without any notice
to the Company or any other act by the Documentation Agent or the Banks,
the Total Commitments shall thereupon terminate and the Loans, interest
accrued thereon and all other amounts payable hereunder shall become
immediately due and payable without presentment, demand, protest or other
notice of any kind, all of which are hereby waived by the Company.
ARTICLE VII
THE AGENTS
SECTION 7.01. Appointment and Authorization. Each Bank appoints
and authorizes each Agent to take such action as agent on its behalf and to
exercise such powers under this Agreement and the Notes as are delegated to
such Agent by the terms hereof or thereof, together with all such powers as
are reasonably incidental thereto; provided, however, that the Agents shall
not commence any legal action or proceeding before a court of law on behalf
of any Bank without such Bank's prior consent.
SECTION 7.02. Agents and Affiliates. Each of Bank of America
National Trust and Savings Association and Morgan Guaranty Trust Company of
New York and their respective affiliates may accept deposits from, lend
money to, and generally engage in any kind of business with the Company or
any Subsidiary or affiliate of the Company as if it were not an Agent
hereunder. With respect to its Commitment and Loans made by it, each of
Bank of America National Trust and Savings Association and Morgan Guaranty
Trust Company of New York (and any of their respective successors acting as
an Agent), in its capacity as a Bank hereunder, shall have the same rights
and obligations hereunder as any other Bank and may exercise (or be subject
to) the same as though it were not an Agent. The term "Bank" or "Banks"
shall, unless otherwise expressly indicated, include each of Bank of
America National Trust and Savings Association and Morgan Guaranty Trust
Company of New York (and any successor acting as an Agent) in its capacity
as a Bank.
SECTION 7.03. Action by Agents. The obligations of the Agents
hereunder are only those expressly set forth herein. Without limiting the
generality of the foregoing, the Agents shall not be required to take any
action with respect to any Default, except as expressly provided in Article
VI.
SECTION 7.04. Consultation with Experts. Each Agent may consult
with legal counsel (who may be counsel for the Company), independent public
accountants and other experts selected by it and shall not be liable to any
Bank for any action taken or omitted to be taken by it in good faith in
accordance with the advice of such counsel, accountants or experts.
SECTION 7.05. Liability of Agents. No Agent nor any of its
directors, officers, agents, or employees shall be liable for any action
taken or not taken by it in connection herewith (i) with the consent or at
the request of the Required Banks or (ii) in the absence of its own gross
negligence or willful misconduct. No Agent nor any of its directors,
officers, agents or employees shall be responsible for or have any duty to
ascertain, inquire into or verify (i) any statement, warranty or
representation made by any Person in connection with this Agreement or any
borrowing hereunder; (ii) the performance or observance of any of the
covenants or agreements of the Company; (iii) the satisfaction of any
condition specified in Article III, except receipt of items required to be
delivered to such Agent; or (iv) the validity, effectiveness (except for its
own due execution and delivery) or genuineness of this Agreement, the Notes
or any other instrument or writing furnished in connection herewith. No
Agent shall incur any liability by acting in reasonable reliance upon any
notice, consent, certificate, statement, or other writing (which may be a
bank wire, facsimile transmission or similar writing) believed by it to be
genuine or to be signed by the proper party or parties.
SECTION 7.06. Indemnification. Each Bank shall, ratably in
accordance with its Commitment, indemnify each Agent (to the extent not
reimbursed by the Company) against any cost, expense (including counsel
fees and disbursements), claim, demand, action, loss or liability (except
such as result from such Agent's gross negligence or willful misconduct)
that such Agent may suffer or incur in connection with this Agreement or
any action taken or omitted by such Agent hereunder.
SECTION 7.07. Credit Decision. Each Bank acknowledges that it
has, independently and without reliance upon either Agent or any other
Bank, and based on such documents and information as it has deemed
appropriate, made its own credit analysis and decision to enter into this
Agreement. Each Bank also acknowledges that it will, independently and
without reliance upon either Agent or any other Bank, and based on such
documents and information as it shall deem appropriate at the time,
continue to make its own credit decisions in taking or not taking any
action under this Agreement.
SECTION 7.08. Successor Agents. An Agent may resign at any time
by giving written notice thereof to the Banks and the Company. Upon any
such resignation, the Company shall, with the consent of the Required
Banks, have the right to appoint a successor Agent (which may be the other
institution then acting as Agent). If no successor Agent shall have been so
appointed, and shall have accepted such appointment, within 60 days after
the retiring Agent gives notice of resignation, the retiring Agent may, on
behalf of the Banks, appoint a successor Agent (which may be the other
institution then acting as Agent), which shall be a commercial bank
organized or licensed under the laws of the United States of America or of
any State thereof and having a combined capital and surplus of at least
$50,000,000. Upon the acceptance of its appointment as an Agent hereunder
by a successor Agent, such successor Agent shall thereupon succeed to and
become vested with all the rights and duties of the retiring Agent, and the
retiring Agent shall be discharged from its duties and obligations
hereunder as Agent. After any retiring Agent's resignation hereunder as an
Agent, the provisions of this Article shall inure to its benefit as to any
actions taken or omitted to be taken by it while it was an Agent.
SECTION 7.09. Agents' Fees. The Company shall
pay to each Agent for its own account fees in the amounts
and at the times previously agreed upon between the Company
and each Agent.
ARTICLE VIII
CHANGE IN CIRCUMSTANCES
SECTION 8.01. Increased Cost and Reduced Return; Capital
Adequacy. (a) If after the date hereof, in the case of any Committed Loan,
or the date of the related Money Market Quote, in the case of any Money
Market Loan, a Change in Law shall impose, modify or deem applicable any
reserve, special deposit, assessment or similar requirement (including,
without limitation, any such requirement imposed by the Board of Governors
of the Federal Reserve System pursuant to Regulation D or otherwise but
excluding any such requirements taken into account in its calculation of
the Adjusted CD Rate, as herein provided) against assets of, deposits with
or for the account of, or credit extended by, any Bank or shall impose on
any Bank or the London interbank market any other condition affecting such
Bank's Fixed Rate Loans, or its Notes; and the result of any of the
foregoing is to increase the cost to such Bank of making or maintaining any
such Fixed Rate Loans, or to reduce the amount of any sum received or
receivable by such Bank under this Agreement or under its Note, by an
amount deemed by such Bank to be material, then, within 15 days after
written demand therefor made through the Administrative Agent, in the form
of the certificate referred to in Section 8.01(c), the Company shall pay to
such Bank such additional amount or amounts as will compensate such Bank
for such increased cost or reduction; provided that the Company shall not
be required to pay any such compensation with respect to any period prior
to the 30th day before the date of any such demand.
(b) Without limiting the effect of Section 8.01(a) (but without
duplication), if any Bank determines at any time after the date on which
this Agreement becomes effective that a Change in Law will have the effect
of increasing the amount of capital required to be maintained by such Bank
(or its Parent) based on the existence of such Bank's Loans, Commitment
and/or other obligations hereunder, then the Company shall pay to such
Bank, within 15 days after its written demand therefor made through the
Administrative Agent in the form of the certificate referred to in Section
8.01(c), such additional amounts as shall be required to compensate such
Bank for any reduction in the rate of return on capital of such Bank (or
its Parent) as a result of such increased capital requirement; provided
that the Company shall not be required to pay any such compensation with
respect to any period prior to the 30th day before the date of any such
demand; provided further, however, that to the extent (i) a Bank shall
increase its level of capital above the level maintained by such Bank on
the date of this Agreement and there has not been a Change in Law or (ii)
there has been a Change in Law and a Bank shall increase its level of
capital by an amount greater than the increase attributable (taking into
consideration the same variables taken into consideration in determining
the level of capital maintained by such Bank on the date of this Agreement)
to such Change in Law, the Company shall not be required to pay any amount
or amounts under this Agreement with respect to any such increase in
capital. Thus, for example, a Bank which is "adequately capitalized" (as
such term or any similar term is used by any applicable bank regulatory
agency having authority with respect to such Bank) may not require the
Company to make payments in respect of increases in such Bank's level of
capital made under the circumstances described in clause (i) or (ii) above
which improve its capital position from "adequately capitalized" to "well
capitalized" (as such term or any similar term is used by any applicable
bank regulatory agency having authority with respect to such Bank).
(c) Each Bank will promptly notify the Company, through the
Administrative Agent, of any event of which it has knowledge, occurring
after the date on which this Agreement becomes effective, which will
entitle such Bank to compensation pursuant to this Section 8.01 and will
designate a different Applicable Lending Office if such designation will
avoid the need for, or reduce the amount of, such compensation and will
not, in the sole judgment of such Bank, be otherwise disadvantageous to
such Bank. A certificate of any Bank claiming compensation under this
Section 8.01 and setting forth the additional amount or amounts to be paid
to it hereunder and setting forth the basis for the determination thereof
shall be conclusive in the absence of manifest error. In determining such
amount, such Bank shall act reasonably and in good faith, and may use any
reasonable averaging and attribution methods.
SECTION 8.02. Substitute Rate. Anything herein to the contrary
notwithstanding, if within two Domestic Business Days, in the case of CD
Loans, or two Eurodollar Business Days, in the case of Eurodollar Loans or
Money Market Eurodollar Loans, prior to the first day of an Interest Period
none of the Reference Banks is, for any reason whatsoever, being offered
Dollars for deposit in the relevant market for a period and amount relevant
to the computation of the rate of interest on a Fixed Rate Loan for such
Interest Period, the Administrative Agent shall give the Company and each
Bank prompt notice thereof and on what would otherwise be the first day of
such Interest Period such Loans shall be made as Base Rate Loans.
SECTION 8.03. Illegality. (a) Notwithstanding any other
provision herein, if, after the date on which this Agreement becomes
effective, a Change in Law shall make it unlawful or impossible for any
Bank to (i) honor any Commitment it may have hereunder to make any
Eurodollar Loan, then such Commitment shall be suspended, or (ii) maintain
any Eurodollar Loan or any Money Market Eurodollar Loan, then all
Eurodollar Loans and Money Market Eurodollar Loans of such Bank then
outstanding shall be converted into Base Rate Loans as provided in Section
8.03(b), and any remaining Commitment of such Bank hereunder to make
Eurodollar Loans (but not other Loans) shall be immediately suspended, in
either case until such Bank may again make and/or maintain Eurodollar Loans
(as the case may be), and borrowings from such Bank, at a time when
borrowings from the other Banks are to be of Eurodollar Loans, shall be
made, simultaneously with such borrowings from the other Banks, by way of
Base Rate Loans. Upon the occurrence of any such change, such Bank shall
promptly notify the Company thereof (with a copy to the Agents), and shall
furnish to the Company in writing evidence thereof certified by such Bank.
Before giving any notice pursuant to this Section 8.03, such Bank shall
designate a different Applicable Lending Office if such designation will
avoid the need for giving such notice and will not, in the sole reasonable
judgment of such Bank, be otherwise disadvantageous to such Bank.
(b) Any conversion of any outstanding Eurodollar Loan or an
outstanding Money Market Loan which is required under this Section 8.03
shall be effected immediately (or, if permitted by applicable law, on the
last day of the Interest Period therefor).
SECTION 8.04. Taxes on Payments. (a) All payments in respect of
the Loans shall be made free and clear of and without any deduction or
withholding for or on account of any present and future taxes, assessments
or governmental charges imposed by the United States, or any political
subdivision or taxing authority thereof or therein, excluding taxes imposed
on its net income and franchise taxes (all such non-excluded taxes being
hereinafter called "Taxes"), except as expressly provided in this Section
8.04. If any Taxes are imposed and required by law to be deducted or
withheld from any amount payable to any Bank, then the Company shall (i)
increase the amount of such payment so that such Bank will receive a net
amount (after deduction of all Taxes) equal to the amount due hereunder,
(ii) pay such Taxes to the appropriate taxing authority for the account of
such Bank, and (iii) as promptly as possible thereafter, send such Bank
evidence showing payment thereof, together with such additional documentary
evidence as such Bank may from time to time require. If the Company fails
to perform its obligations under (ii) or (iii) above, the Company shall
indemnify such Bank for any incremental taxes, interest or penalties that
may become payable as a result of any such failure; provided, however, that
the Company will not be required to make any payment to any Bank under this
Section 8.04 if withholding is required in respect of such Bank by reason
of such Bank's inability or failure to furnish under subsection (c) an
extension or renewal of a Form 1001 or Form 4224 (or successor form), as
applicable, unless such inability results from an amendment to or a change
in any applicable law or regulation or in the interpretation thereof by any
regulatory authority (including without limitation any change in an
applicable tax treaty), which amendment or change becomes effective after
the date hereof.
(b) The Company shall indemnify the Agents and each Bank
against any transfer taxes, documentary taxes, assessments or charges made
by any Governmental Authority by reason of the execution and delivery of
this Agreement or any Notes (hereinafter referred to as "Other Taxes").
(c) Each Bank that is a foreign person (i.e. a person who is
not a United States person for United States federal income tax purposes)
agrees that it shall deliver to the Company (with a copy to the
Administrative Agent) (i) within twenty Domestic Business Days after the
date on which this Agreement becomes effective, two duly completed copies
of United States Internal Revenue Service Form 1001 or 4224, as
appropriate, indicating that such Bank is entitled to receive payments
under this Agreement without deduction or withholding of any United States
federal income taxes, (ii) from time to time, such extensions or renewals
of such forms (or successor forms) as may reasonably be requested by the
Company but only to the extent such Bank determines that it may properly
effect such extensions or renewals under applicable tax treaties, laws,
regulations and directives and (iii) in the event of a transfer of any Loan
to a subsidiary or affiliate of such Bank, a new Internal Revenue Service
Form 1001 or 4224 (or any successor form), as the case may be, for such
subsidiary or affiliate indicating that such subsidiary or affiliate is, on
the date of delivery thereof, entitled to receive payments under this Agreement
without deduction or withholding of any United States federal income taxes.
The Company and the Administrative Agent shall each be entitled to rely on
such forms in its possession until receipt of any revised or successor form
pursuant to the preceding sentence.
(d) If a Bank, at the time it first becomes a party to this
Agreement (or because of a change in an Applicable Lending Office) is
subject to a United States interest withholding tax rate in excess of zero,
withholding tax at such rate shall be considered excluded from Taxes and
Other Taxes, respectively. For any period with respect to which a Bank has
failed to provide the Company with the appropriate form pursuant to Section
8.04(c) (unless such failure is due to a change in treaty, law or
regulation, or in the interpretation thereof by any regulatory authority,
occurring subsequent to the date on which a form originally was required to
be provided), such Bank shall not be entitled to additional payments under
Section 8.04(a) with respect to Taxes imposed by the United States;
provided, however, that should a Bank, which is otherwise exempt from or
subject to a reduced rate of withholding tax, become subject to Taxes
because of its failure to deliver a form required hereunder, the Company
shall take such steps as such Bank shall reasonably request to assist such
Bank to recover such Taxes.
(e) If the Company is required to pay additional amounts to or
for the account of any Bank pursuant to this Section 8.04, then such Bank
will change the jurisdiction of one or more Applicable Lending Offices so
as to eliminate or reduce any such additional payment which may thereafter
accrue if such change, in the judgment of such Bank, is not otherwise
disadvantageous to such Bank.
(f) If any Bank is able to apply for any credit, deduction or
other reduction in Taxes or Other Taxes in an amount which is reasonably
determined by such Bank to be material, which arises by reason of any
payment made by the Company pursuant to this Section 8.04, such Bank will
use reasonable efforts to obtain such credit, deduction or other reduction
and, upon receipt thereof, will pay to the Company an amount, not exceeding
the amount of such payment by the Company, equal to the net after-tax value
to such Bank, in its good faith determination, of such part of such credit,
deduction or other reduction as it determines to be allocable to such
payment by the Company, having regard to all of its dealings giving rise to
similar credits, deductions or other reductions during the same tax period
and to the cost of obtaining the same; provided, however, that (i) such
Bank shall not be obligated to disclose to the Company any information
regarding its tax affairs or computations and (ii) nothing contained in
this Section 8.04(f) shall be construed so as to interfere with the right
of such Bank to arrange its tax affairs as it deems appropriate.
ARTICLE IX
GUARANTEE
SECTION 9.01. Unconditional Guarantee.
(a) Subject to the provisions of Section 9.03, the Guarantor
hereby fully and unconditionally guarantees the due and punctual payment of
the principal of and interest on the Loans, when and as the same shall
become due and payable, whether at maturity, upon acceleration or
otherwise, and of all other amounts payable by the Company hereunder, in
accordance with the terms of this Agreement. Upon failure by the Company in
the payment of any such amount, the Guarantor agrees to pay the same on
demand by the Documentation Agent at the request of the Required Banks and
in the manner specified in Article II.
(b) The Guarantor's obligations hereunder shall be absolute and
unconditional irrespective of, and shall be unaffected by: (i) any failure
to enforce the provisions of this Agreement; (ii) any extension, renewal,
settlement, compromise, waiver, consent, or indulgence granted to the
Company in respect of any obligation of the Company hereunder or under any
Note, by operation of law or otherwise; (iii) any modification or amendment
of or supplement to this Agreement or any Note, provided that,
notwithstanding the foregoing, no such modification, amendment or
supplement to this Agreement shall, without the consent of the Guarantor,
increase (other than pursuant to the terms of this Agreement) any amount
guaranteed hereunder or modify the terms of this Article IX; (iv) any
change in the corporate existence, structure or ownership of the Company,
or any insolvency, bankruptcy, reorganization or other similar proceeding
affecting the Company or its assets or any resulting release or discharge
of any obligation of the Company contained in this Agreement or any Note;
(v) the existence of any claim, set off or other rights which the Guarantor
may have at any time against the Company, either Agent, any Bank or any
other Person, whether in connection herewith or with any unrelated
transactions; provided that nothing herein shall prevent the assertion of
any such claim by separate suit or compulsory counterclaim; or (vi) any
other circumstance that otherwise might constitute a legal or equitable
discharge of a surety or guarantor.
(c) The Guarantor hereby waives diligence, presentment, filing
of claims with a court in the event of insolvency or bankruptcy of the
Company, any right to require a proceeding first against the Company,
protest, notice and all demands on the Company or the Guarantor whatsoever.
(d) The Guarantor will be subrogated to all rights of the Banks
against the Company in respect of any amount paid by the Guarantor pursuant
to the provisions of the Guarantee contained in this Section 9.01;
provided, however, that the Guarantor shall not be entitled to enforce, or
to receive any payments arising out of or based upon, such right of
subrogation until the principal of and interest on all Loans and any other
amount payable under this Agreement shall have been paid in full.
SECTION 9.02. Discharge; Reinstatement. The obligations of the
Guarantor hereunder shall remain in full force and effect until the
Commitments shall have terminated and the principal of and interest on the
Loans and all the amounts payable by the Company under this Agreement shall
have been paid in full. If at any time any payment of the principal of or
interest on any Loan or any other amount payable by the Company hereunder
is rescinded or must be otherwise restored or returned upon the insolvency,
bankruptcy or reorganization of the Company or otherwise, the obligations
of the Guarantor hereunder with respect to such payment shall be reinstated
as though such payment had been due but not made at such time.
If acceleration of the time for payment of any amount payable
by the Company under this Agreement is stayed upon the insolvency,
bankruptcy or reorganization of the Company, all such amounts otherwise
subject to acceleration under the terms of this Agreement shall none the
less be payable by the Guarantor hereunder forthwith on demand by the
Documentation Agent made at the request of the Required Banks.
SECTION 9.03. Limit of Liability. The obligations of the
Guarantor hereunder shall be limited to an amount equal to the largest
amount that would not render its obligations hereunder subject to avoidance
under Section 548 of the United States Bankruptcy Code or any comparable
provisions of any applicable state law.
ARTICLE X
MISCELLANEOUS
SECTION 10.01. Termination of Commitment of a Bank; New Banks.
(a)(1) If and during the time a Failed Loan shall exist, (2) upon receipt
of notice from any Bank for compensation or indemnification pursuant to
Section 8.01(c) or Section 8.04 or (3) upon receipt of notice that the
Commitment of a Bank to make Eurodollar Loans has been suspended, the
Company shall have the right to terminate the Commitment in full of the
Bank causing such Failed Loan or providing such notice (a "Retiring Bank").
The termination of the Commitment of a Retiring Bank pursuant to this
Section 10.01(a) shall be effective on the tenth Domestic Business Day
following the date of a notice of such termination to the Retiring Bank
through the Documentation Agent, subject to the satisfaction of the
following conditions:
(i) in the event that on such effective date there shall
be any Loans outstanding hereunder, the Company shall have prepaid on
such date the aggregate principal amount of such Loans held by the
Retiring Bank only; and
(ii) in addition to the payment of the principal of the
Loans held by the Retiring Bank pursuant to clause (i) above, the
Company shall have paid such Retiring Bank all accrued interest
thereon, and Facility Fee and any other amounts then payable to it
hereunder, including, without limitation, all amounts payable by the
Company to such Bank under Section 2.14 by reason of the prepayment
of Loans pursuant to clause (i) with respect to the period ending on
such effective date; provided that the provisions of Section 8.01,
Section 8.04 and Section 10.04 shall survive for the benefit of any
Retiring Bank.
Upon satisfaction of the conditions set forth in clauses (i)
and (ii) above, such Bank shall cease to be a Bank hereunder.
(b) In lieu of the termination of a Bank's Commitment pursuant
to Section 10.01(a), the Company may notify the Documentation Agent that
the Company desires to replace such Retiring Bank with a new bank or banks
(which may be one or more of the Banks), which will purchase the Loans and
assume the Commitment of the Retiring Bank. Upon the Company's selection of
a bank to replace a Retiring Bank, such bank's agreement thereto and the
fulfillment of the conditions to assignment and assumption set forth in
Section 10.08(c)(iii), such bank shall become a Bank hereunder for all
purposes in accordance with Section 10.08(c)(iii).
SECTION 10.02. Notices. All notices, requests and other
communications to any party hereunder shall be in writing (including bank
wire, telecopy, facsimile transmission or similar writing) and shall be
given to such party (a) in the case of the Company, the Guarantor or either
Agent, at its address set forth on the signature pages hereof, (b) in the
case of any Bank, at its address set forth in its Administrative
Questionnaire or (c) in the case of any party, such other address as such
party may hereafter specify for the purpose by notice to the Agents and the
Company. Each such notice, request or other communication shall be
effective (i) if given by registered or certified mail, upon the earlier of
the date of actual receipt or the date of delivery indicated on the return
receipt delivered to the sender or (ii) if given by any other means, when
received at the address or telecopier number specified in this Section and
an oral or written confirmation of receipt is received from the recipient.
SECTION 10.03. No Waivers. No failure or delay by either Agent
or any Bank in exercising any right, power or privilege hereunder or under
any Note shall operate as a waiver thereof nor shall any single or partial
exercise thereof preclude any other or further exercise thereof or the
exercise of any other right, power or privilege. The rights and remedies
herein provided shall be cumulative and not exclusive of any rights or
remedies provided by law.
SECTION 10.04. Expenses; Indemnification. (a) The Company shall
pay (i) the reasonable fees and expenses of special counsel for the Agents
in connection with the preparation of this Agreement as previously agreed
upon between the Company and each Agent and (ii) if an Event of Default
occurs, all reasonable out-of-pocket expenses incurred by the Agents and
the Banks, including reasonable fees and expenses of counsel (including
in-house counsel), in connection with such Event of Default and collection
and other enforcement proceedings resulting therefrom.
(b) The Company agrees to indemnify the Agents and each Bank,
their respective affiliates and the respective directors, officers, agents
and employees of the foregoing (each an "Indemnitee") and hold each
Indemnitee harmless from and against any and all liabilities, losses,
damages, costs and reasonable expenses of any kind, including, without
limitation, the reasonable fees and disbursements of counsel, incurred by
such Indemnitee in response to or in defense of any investigative,
administrative or judicial proceeding brought or threatened against either
Agent or any Bank relating to or arising out of this Agreement or any
actual or proposed use of proceeds of Loans hereunder; provided that no
Indemnitee shall have the right to be indemnified hereunder (i) to the
extent such indemnification relates to relationships of, between or among
each of, or any of, the Agents, the Banks or any Assignee or Participant or
(ii) for such Indemnitee's own gross negligence or willful misconduct.
SECTION 10.05. Pro Rata Treatment. Except as expressly provided
in this Agreement with respect to Money Market Loans or otherwise, (a) each
borrowing from, and change in the Commitments of, the Banks shall be made
pro rata according to their respective Commitments, and (b) each payment
and prepayment on the Loans shall be made to all the Banks, pro rata in
accordance with the unpaid principal amount of the Loans held by each of
them.
SECTION 10.06. Sharing of Set-Offs. Each Bank agrees that if it
shall, by exercising any right of set-off or counterclaim or otherwise
(except as contemplated by Section 2.03, Section 2.14, Article VIII or
Section 10.01), receive payment of a proportion of the aggregate amount of
principal and interest then due with respect to the Loans held by it which
is greater than the proportion received by any other Bank in respect of the
aggregate amount of principal and interest then due with respect to the
Loans held by such other Bank, the Bank receiving such proportionately
greater payment shall purchase such participations in the Loans held by the
other Banks, and such other adjustments shall be made, as may be required
so that all such payments of principal and interest with respect to the
Loans held by the Banks shall be shared by the Banks pro rata; provided
that nothing in this Section shall impair the right of any Bank to exercise
any right of set-off or counterclaim it may have and to apply the amount
subject to such exercise to the payment of indebtedness of the Company,
other than its indebtedness hereunder.
SECTION 10.07. Amendments and Waivers. Any provision of this
Agreement or the Notes may be amended or waived if, but only if, such
amendment or waiver is in writing and is signed by the Company and the
Required Banks (and, if the rights or duties of an Agent are affected
thereby, by the Agent so affected); provided that no such amendment or
waiver shall, unless signed by all the Banks, (i) subject any Bank to any
additional obligation, (ii) reduce the principal of or rate of interest on
any Loan or any fees hereunder, (iii) postpone the date fixed for any
payment of principal of or interest on any Loan or for termination of any
Commitment, (iv) change the percentage of Loans or Total Commitments that
shall be required for the Banks or any of them to take any action under this
Section 10.07 or any other provision of this Agreement or (v) release the
Guarantor from its obligations under, or modify in any material respect the
provisions of, Article IX. Notwithstanding the foregoing, Article IX may
not be amended without the prior consent of the Guarantor.
SECTION 10.08. Successors and Assigns; Participations; Novation.
(a) This Agreement shall be binding upon and inure to the
benefit of the parties hereto and their respective successors and assigns;
provided that, except in accordance with Sections 5.04 and 5.07, the
Company and the Guarantor may not assign or transfer any of their
respective rights or obligations under this Agreement without the consent
of all Banks.
(b) Any Bank may, without the consent of the Company, but upon
prior written notification to the Company, at any time sell to one or more
banks or other financial institutions (each a "Participant") participating
interests in any Loan owing to such Bank, any Note held by such Bank, the
Commitment of such Bank hereunder, and any other interest of such Bank
hereunder; provided that no prior notification to the Company is required
in connection with the sale of a participating interest in a Money Market
Loan or a Money Market Note. In the event of any such sale by a Bank of a
participating interest to a Participant, such Bank's obligations under this
Agreement shall remain unchanged, such Bank shall remain solely responsible
for the performance thereof, such Bank shall remain the holder of its Note
or Notes, if any, for all purposes under this Agreement and the Company and
the Agents shall continue to deal solely and directly with such Bank in
connection with such Bank's rights and obligations under this Agreement.
Any agreement pursuant to which a Bank may grant such a participating
interest shall provide that such Bank shall retain the sole right and
responsibility to enforce the obligations of the Company hereunder
including, without limitation, the right to approve any amendment,
modification or waiver of any provision of this Agreement; provided that
such participation agreement may provide that such Bank will not agree to
any modification, amendment or waiver of this Agreement described in clause
(i), (ii) or (iii) of Section 10.07 affecting such Participant without the
consent of the Participant; provided further that such Participant shall be
bound by any waiver, amendment or other decision that all Banks shall be
required to abide by pursuant to a vote by Required Banks. Subject to the
provisions of Section 10.08(d), the Company agrees that each Participant
shall, to the extent provided in its participation agreement, be entitled
to the benefits of Article VIII with respect to its participating interest.
An assignment or other transfer which is not permitted by subsection (c) or
(g) below shall be given effect for purposes of this Agreement only to the
extent of a participating interest granted in accordance with this
subsection (b).
(c) (i) Any Bank may at any time sell to one or more Eligible
Institutions (each an "Assignee") all or a portion of its rights and
obligations under this Agreement and the Notes. Each Assignee shall assume
all such rights and obligations pursuant to an Assignment and Assumption
Agreement executed by such Assignee, such transferor Bank and the Company.
In no event shall (A) any Commitment of a transferor Bank (together with
the Commitment of any affiliate of such Bank), after giving effect to any
sale pursuant to this subsection (c), be less than $15,000,000, or (B) any
Commitment of an Assignee (together with the Commitment of any affiliate of
such Assignee), after giving effect to any sale pursuant to this subsection
(c), be less than $15,000,000, except in each case as may result upon the
transfer by a Bank of its Commitment in its entirety. No Bank may make an
assignment hereunder unless it makes a like ratable assignment to the same
Assignee under the $5,000,000,000 Revolving Credit Agreement among the
parties hereto, dated as of the date hereof, providing for a commitment of
364 days.
(ii) No interest may be sold by a Bank pursuant to this
subsection (c), except to an affiliate of such Bank, without the prior
written consent of the Company, which consent shall not be unreasonably
withheld. The withholding of consent by the Company shall not be deemed
unreasonable if based solely upon the Company's desire to (A) balance
relative loan exposures to such Eligible Institution among all credit
facilities of the Company or (B) avoid payment of any additional amounts
payable to such Eligible Institution under Article VIII which would arise
from such assignment.
(iii) Upon (A) execution of an Assignment and Assumption
Agreement, (B) delivery by the transferor Bank of an executed copy thereof,
together with notice that the payment referred to in clause (C) below shall
have been made, to the Company and the Administrative Agent, (C) payment by
such Assignee to such transferor Bank of an amount equal to the purchase
price agreed between such transferor Bank and such Assignee and (D) if the
Assignee is organized under the laws of any jurisdiction other than the
United States or any state thereof, evidence satisfactory to the
Administrative Agent and the Company of compliance with the provisions of
Section 10.08(f), such Assignee shall for all purposes be a Bank party to
this Agreement and shall have all the rights and obligations of a Bank
under this Agreement to the same extent as if it were an original party
hereto with a Commitment as set forth in such Assignment and Assumption
Agreement, and the transferor Bank shall be released from its obligations
hereunder to a correspondent extent, and no further consent or action by
the Company, the Banks or the Agents shall be required to effectuate such
transfer. Each Assignee shall be bound by any waiver, amendment or other
decision that all Banks shall be required to abide by pursuant to a vote by
Required Banks.
(iv) Upon the consummation of any transfer to an Assignee
pursuant to this subsection (c), the transferor Bank, the Administrative
Agent and the Company shall make appropriate arrangements so that, if
requested by the transferor Bank or the Assignee, a new Note or Notes shall
be delivered from the Company to the transferor Bank and/or such Assignee.
In connection with any such assignment, the Assignee or the transferor Bank
shall pay to the Administrative Agent an administrative fee for processing
such assignment in the amount of $2,500.
(d) No Assignee, Participant or other transferee (including any
successor Applicable Lending Office) of any Bank's rights shall be entitled
to receive any greater payment under Section 8.01 than such Bank would have
been entitled to receive with respect to the rights transferred, unless
such transfer is made with the Company's prior written consent or by reason
of the provisions of Section 8.01 or 8.03 requiring such Bank to designate
a different Applicable Lending Office under certain circumstances or at a
time when the circumstances giving rise to such greater payment did not
exist.
(e) Each Bank may, upon the written consent of the Company,
which consent shall not be unreasonably withheld, disclose to any
Participant or Assignee (each a "Transferee") and any prospective
Transferee any and all financial information in such Bank's possession
concerning the Company that has been delivered to such Bank by the Company
pursuant to this Agreement or that has been delivered to such Bank by the
Company in connection with such Bank's credit evaluation prior to entering
into this Agreement, subject in all cases to agreement by such Transferee
or prospective Transferee to comply with the provisions of Section 10.14.
(f) If pursuant to subsection (c) of this Section 10.08, any
interest in this Agreement or any Note is transferred to any Assignee that
is organized under the laws of any jurisdiction other than the United
States or any state thereof, the transferor Bank shall cause such Assignee,
concurrently with the effectiveness of such transfer, (i) to represent to
the transferor Bank (for the benefit of the transferor Bank, the Agents and
the Company) that under applicable law and treaties no taxes will be
required to be withheld by the Administrative Agent, the Company or the
transferor Bank with respect to any payments to be made to such Assignee in
respect of the Loans and (ii) to furnish to each of the transferor Bank,
the Administrative Agent and the Company two duly completed copies of the
forms required by Section 8.04(c)(i).
(g) Notwithstanding any provision of this Section 10.08 to the
contrary, any Bank may assign or pledge any of its rights and interests in
the Loans to a Federal Reserve Bank without the consent of the Company.
SECTION 10.09. Visitation. Subject to restrictions imposed by
applicable security clearance regulations, the Company will upon reasonable
notice permit representatives of any Bank at such Bank's expense to visit
any of its major properties.
SECTION 10.10. Reference Banks. If any Reference Bank assigns
its rights and obligations hereunder to an unaffiliated institution, the
Company shall, in consultation with the Administrative Agent, appoint
another Bank to act as a Reference Bank hereunder. If the Commitment of any
Bank which is also a Reference Bank is terminated pursuant to the terms of
this Agreement, the Company may, in consultation with the Administrative
Agent, appoint a replacement Reference Bank.
SECTION 10.11. Governing Law; Submission to Jurisdiction. This
Agreement and each Note shall be governed by and construed in accordance
with the internal laws of the State of New York. Each of the Company, the
Guarantor, the Agents and the Banks hereby submits to the nonexclusive
jurisdiction of the United States District Court for the Southern District
of New York and of any New York State Court sitting in New York for
purposes of all legal proceedings arising out of or relating to this
Agreement or the transactions contemplated hereby. Each of the Company, the
Guarantor, the Agents and the Banks irrevocably waives, to the fullest
extent permitted by law, any objection which it may now or hereafter have
to the laying of the venue of any such proceeding brought in such a court
and any claim that any such proceeding brought in such a court has been
brought in an inconvenient forum.
SECTION 10.12. Effectiveness; Counterparts; Integration. This
Agreement shall become effective upon receipt by the Documentation Agent of
counterparts hereof signed by each of the parties hereto (or, in the case
of any party as to which an executed counterpart shall not have been
received, receipt by the Documentation Agent in form satisfactory to it of
telegraphic, telex, facsimile or other written confirmation from such party
of execution of a counterpart hereof by such party). This Agreement may be
signed in any number of counterparts, each of which shall be an original,
with the same effect as if the signatures thereto and hereto were upon the
same instrument. This Agreement constitutes the entire agreement and
understanding among the parties hereto and supersedes any and all prior
agreements and understandings, oral or written, relating to the subject
matter hereof.
SECTION 10.13. WAIVER OF JURY TRIAL. EACH OF THE COMPANY, THE
GUARANTOR, THE AGENTS AND THE BANKS HEREBY IRREVOCABLY WAIVES ANY AND ALL
RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING
TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
SECTION 10.14. Confidentiality. Each Bank agrees, with respect
to any information delivered or made available by the Company to it that is
clearly indicated to be confidential information or private data, to use
all reasonable efforts to protect such confidential information from
unauthorized use or disclosure and to restrict disclosure to only those
Persons employed or retained by such Bank who are or are expected to become
engaged in evaluating, approving, structuring or administering this
Agreement and the transactions contemplated hereby. Nothing herein shall
prevent any Bank from disclosing such information (i) to any other Bank,
(ii) to its affiliates, officers, directors, employees, agents, attorneys
and accountants who have a need to know such information in accordance with
customary banking practices and who receive such information having been
made aware of and having agreed to the restrictions set forth in this
Section, (iii) upon the order of any court or administrative agency, (iv)
upon the request or demand of any regulatory agency or authority having
jurisdiction over such Bank, (v) which has been publicly disclosed, (vi) to
the extent reasonably required in connection with any litigation to which
either Agent, any Bank, the Company or their respective affiliates may be a
party, (vii) to the extent reasonably required in connection with the
exercise of any remedy hereunder and (viii) with the prior written consent
of the Company; provided however, that before any disclosure is permitted
under (iii) or (vi) of this Section 10.14, each Bank shall, if not legally
prohibited, notify and consult with the Company, promptly and in a timely
manner, concerning the information it proposes to disclose, to enable the
Company to take such action as may be appropriate under the circumstances
to protect the confidentiality of the information in question, and provided
further that any disclosure under the foregoing proviso be limited to only
that information discussed with the Company. The use of the term
"confidential" in this Section 10.14 is not intended to refer to data
classified by the government of the United States under laws and
regulations relating to the handling of data, but is intended to refer to
information and other data regarded by the Company as private.
SECTION 10.15. Termination and Payment under Existing
Agreements. The Company and each of the Banks that is also a party to an
agreement referred to in Section 3.01(g) agree that the "Commitments" as
defined in such agreement shall terminate in their entirety on the Closing
Date. Each such Bank waives (a) any requirement of notice of such
termination pursuant to such agreement and (b) any claim to any fees under
such agreement for any day on or after the Closing Date. The Company agrees
that (i) no loans will be outstanding under such agreements on or at any
time after the Closing Date and (ii) all accrued and unpaid fees and other
amounts due and payable under such agreements on or before the Closing Date
will be paid on or before the Closing Date.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed by their respective authorized officers as of
the day and year first above written.
LOCKHEED MARTIN CORPORATION
By /s/ Walter E. Skowronski
---------------------------
Name: Walter E. Skowronski
Title: Vice President & Treasurer
6801 Rockledge Drive
Bethesda, Maryland 20817
Attention: Walter E. Skowronski
Vice President & Treasurer
Telecopy number: (301) 897-6651
With a copy to: Frank H. Menaker, Jr.
Vice President &
General Counsel
Telecopy number: (301) 897-6333
LAC ACQUISITION CORPORATION,
AS GUARANTOR
By /s/ Marcus C. Bennett
------------------------
Name: Marcus C. Bennett
Title: President
6801 Rockledge Drive
Bethesda, Maryland 20817
Attention: Treasurer
Telecopy number: (301) 897-6651
With a copy to: Frank H. Menaker, Jr.
Vice President &
General Counsel
Telecopy number: (301) 897-6333
MORGAN GUARANTY TRUST COMPANY OF
NEW YORK, as Documentation Agent
By /s/ Diana H. Imhof
---------------------
Name: Diana H. Imhof
Title: Vice President
60 Wall Street
New York, New York 10260
Attention: Diana Imhof
Telecopy Number: (212) 648-5014
BANK OF AMERICA NATIONAL TRUST AND
SAVINGS ASSOCIATION,
as Administrative Agent
By /s/ Charles D. Graber
------------------------
Name: Charles D. Graber
Title: Vice President
1455 Market Street
San Francisco, California 94103
Attention: Charles Graber
Telecopy number: (415) 436-2700
COMMITMENT: BANK:
$ 205,000,000 MORGAN GUARANTY TRUST COMPANY
OF NEW YORK
By /s/ Diana H. Imhof
---------------------
Name: Diana H. Imhof
Title: Vice President
$ 205,000,000 BANK OF AMERICA NATIONAL TRUST AND
SAVINGS ASSOCIATION
By /s/ Lori Y. Kannegieter
--------------------------
Name: Lori Y. Kannegieter
Title: Vice President
MANAGING AGENT
--------------
BANK:
$ 180,000,000 CITICORP USA, INC.
By /s/ Marjorie Futornick
-------------------------
Name: Marjorie Futornick
Title: Vice President
CO-AGENTS
---------
BANKS:
$ 135,000,000 ABN AMRO BANK N.V., NEW YORK BRANCH
By /s/ Frances O. Logan
-----------------------
Name: Frances O. Logan
Title: Vice President
By /s/ Thomas T. Rogers
-----------------------
Name: Thomas T. Rogers
Title: Assistant Vice President
$ 135,000,000 BANK OF MONTREAL
By /s/ Tom Brino
----------------
Name: Tom Brino
Title: Director
$ 135,000,000 THE BANK OF NEW YORK
By /s/ Gregory P. Shefrin
-------------------------
Name: Gregory P. Shefrin
Title: Assistant Vice President
$ 135,000,000 THE BANK OF NOVA SCOTIA
By /s/ James R. Trimble
-----------------------
Name: James R. Trimble
Title: Senior Relationship Manager
$ 135,000,000 BANKERS TRUST COMPANY
By /s/ Gina S. Thompson
-----------------------
Name: Gina S. Thompson
Title: Vice President
$ 135,000,000 BANQUE NATIONALE DE PARIS - NEW YORK BRANCH
By /s/ Richard L. Sted
----------------------
Name: Richard L. Sted
Title: Senior Vice President
By /s/ Thomas N. George
-----------------------
Name: Thomas N. George
Title: Vice President
BANQUE NATIONALE DE PARIS, GEORGETOWN
BRANCH, CAYMAN ISLANDS
By /s/ Richard L. Sted
----------------------
Name: Richard L. Sted
Title: Senior Vice President
By /s/ Thomas N. George
-----------------------
Name: Thomas N. George
Title: Vice President
$ 135,000,000 CANADIAN IMPERIAL BANK OF COMMERCE
By /s/ W. Barrie Anderson
-------------------------
Name: W. Barrie Anderson
Title: Authorized Signatory
$ 135,000,000 CHEMICAL BANK
By /s/ James B. Treger
----------------------
Name: James B. Treger
Title: Vice President
$ 135,000,000 COMMERZBANK AG, NEW YORK BRANCH
By /s/ Andrew R. Campbell
-------------------------
Name: Andrew R. Campbell
Title: Assistant Cashier
By /s/ Jurgen Schmieding
------------------------
Name: Jurgen Schmieding
Title: Vice President
$ 135,000,000 CREDIT LYONNAIS, CAYMAN ISLANDS BRANCH
By /s/ Robert Ivosevich
-----------------------
Name: Robert Ivosevich
Title: Authorized Signature
CREDIT LYONNAIS, NEW YORK BRANCH
By /s/ Robert Ivosevich
-----------------------
Name: Robert Ivosevich
Title: Senior Vice President
$ 135,000,000 CREDIT SUISSE
By /s/ Eileen O'Connell Fox
---------------------------
Name: Eileen O'Connell Fox
Title: Member of Senior Management
By /s/ Andrea E. Shkane
-----------------------
Name: Andrea E. Shkane
Title: Member of Senior Management
$ 135,000,000 THE DAI-ICHI KANGYO BANK, LTD.
By /s/ Tomohiro Nozaki
----------------------
Name: Tomohiro Nozaki
Title: Senior Vice President
and Joint General Manager
$ 135,000,000 DEUTSCHE BANK AG, NEW YORK BRANCH
AND/OR CAYMAN ISLANDS BRANCH
By /s/ James Fox
----------------
Name: James Fox
Title: Assistant Vice President
By /s/ Robert M. Wood, Jr.
--------------------------
Name: Robert M. Wood, Jr.
Title: Vice President
$ 135,000,000 FIRST INTERSTATE BANK OF CALIFORNIA
By /s/ Peter G. Olson
---------------------
Name: Peter G. Olson
Title: Senior Vice President
By /s/ Lancy Gin
----------------
Name: Lancy Gin
Title: Assistant Vice President
$ 135,000,000 THE FIRST NATIONAL BANK OF CHICAGO
By /s/ Lynn R. Dillon
---------------------
Name: Lynn R. Dillon
Title: Vice President
$ 135,000,000 THE INDUSTRIAL BANK OF JAPAN TRUST COMPANY
By /s/ Robert W. Ramage
-----------------------
Name: Robert W. Ramage
Title: Senior Vice President
$ 135,000,000 MELLON BANK, N.A.
By /s/ Laurie G. Dunn
---------------------
Name: Laurie G. Dunn
Title: Vice President
$ 135,000,000 BANK OF TOKYO-MITSUBISHI TRUST COMPANY
By /s/ Naoshi Kinoshita
-----------------------
Name: Naoshi Kinoshita
Title: Vice President
$ 135,000,000 THE MITSUBISHI TRUST AND BANKING
CORPORATION
By /s/ Patricia Loret de Mola
-----------------------------
Name: Patricia Loret de Mola
Title: Vice President
$ 135,000,000 NATIONAL WESTMINSTER BANK PLC,
LOS ANGELES OVERSEAS BRANCH
By /s/ Marilyn A. Windsor
-------------------------
Name: Marilyn A. Windsor
Title: Vice President
NATIONAL WESTMINSTER BANK PLC, NASSAU
BRANCH
By /s/ Marilyn A. Windsor
-------------------------
Name: Marilyn A. Windsor
Title: Vice President
$ 135,000,000 NATIONSBANK, N.A.
By /s/ John D. Mindnich
-----------------------
Name: John D. Mindnich
Title: Senior Vice President
$ 135,000,000 ROYAL BANK OF CANADA
By /s/ Don S. Bryson
--------------------
Name: Don S. Bryson
Title: Senior Manager
$ 135,000,000 THE SANWA BANK, LIMITED - NEW YORK
BRANCH
By /s/ Dominic J. Sorresso
--------------------------
Name: Dominic J. Sorresso
Title: Vice President
$ 135,000,000 SOCIETE GENERALE
By /s/ Ralph Saheb
------------------
Name: Ralph Saheb
Title: Vice President
$ 135,000,000 THE SUMITOMO BANK, LIMITED, NEW YORK
BRANCH
By /s/ Yoshinori Kawamura
-------------------------
Name: Yoshinori Kawamura
Title: Joint General Manager
$ 135,000,000 WACHOVIA BANK OF GEORGIA, N.A.
By /s/ Mark S. Rogus
--------------------
Name: Mark S. Rogus
Title: Senior Vice President
PARTICIPANTS
------------
BANKS:
$ 50,000,000 BANCA COMMERCIALE ITALIANA, NEW YORK
BRANCH
By /s/ Charles P. Dougherty
---------------------------
Name: Charles P. Dougherty
Title: Vice President
By /s/ Tiziano Gallonetto
-------------------------
Name: Tiziano Gallonetto
Title: Assistant Vice President
$ 50,000,000 BANCA NAZIONALE DEL LAVORO S.P.A.
By /s/ Giuliano Violetta
------------------------
Name: Giuliano Violetta
Title: First Vice President
By /s/ Adolph S. Mascari, Jr.
-----------------------------
Name: Adolph S. Mascari, Jr.
Title: Assistant Vice President
$ 50,000,000 BZW DIVISION OF BARCLAYS BANK PLC
By /s/ John C. Livingston
-------------------------
Name: John C. Livingston
Title: Director
$ 50,000,000 BAYERISCHE LANDESBANK GIROZENTRALE,
CAYMAN ISLANDS BRANCH
By /s/ Wilfried Freudenberger
-----------------------------
Name: Wilfried Freudenberger
Title: Executive Vice President
and General Manager
By /s/ Peter Obermann
---------------------
Name: Peter Obermann
Title: Senior Vice President
Manager Lending Division
$ 50,000,000 CORESTATES BANK, N.A.
By /s/ Matthew T. Panarese
--------------------------
Name: Matthew T. Panarese
Title: Vice President
$ 50,000,000 FLEET BANK OF MASSACHUSETTS, N.A.
By /s/ Frank Benesh
-------------------
Name: Frank Benesh
Title: Vice President
$ 50,000,000 THE FUJI BANK, LIMITED, NEW YORK BRANCH
By /s/ Teiji Teramoto
---------------------
Name: Teiji Teramoto
Title: Vice President & Manager
$ 50,000,000 GULF INTERNATIONAL BANK B.S.C.
By /s/ Thomas E. Fitzherbert
----------------------------
Name: Thomas E. Fitzherbert
Title: Vice President
By /s/ Issa N. Baconi
---------------------
Name: Issa N. Baconi
Title: Senior Vice President
& Branch Manager
$ 50,000,000 ISTITUTO BANCARIO SAN PAOLO DI TORINO
S.P.A.
By /s/ Gerard M. McKenna
------------------------
Name: Gerard M. McKenna
Title: Vice President
By /s/ Wendell H. Jones
-----------------------
Name: Wendell H. Jones
Title: Vice President
$ 50,000,000 KREDIETBANK N.V.
By /s/ Robert Snauffer
----------------------
Name: Robert Snauffer
Title: Vice President
By /s/ Armen Karozichan
-----------------------
Name: Armen Karozichan
Title: Vice President
$ 50,000,000 MARINE MIDLAND BANK
By /s/ Mary Ann Tappero
-----------------------
Name: Mary Ann Tappero
Title: Vice President
$ 50,000,000 PNC BANK, NATIONAL ASSOCIATION
By /s/ Mark W. Biedermann
-------------------------
Name: Mark W. Biedermann
Title: Assistant Vice President
$ 50,000,000 THE SAKURA BANK, LTD.
By /s/ Masahiro Nakajo
----------------------
Name: Masahiro Nakajo
Title: Senior Vice President
& Manager
$ 50,000,000 SUNTRUST BANK, ATLANTA
By /s/ Jarrette A. White, III
-----------------------------
Name: Jarrette A. White, III
Title: Vice President
By /s/ Brian K. Peters
----------------------
Name: Brian K. Peters
Title: Vice President
$ 50,000,000 THE TOKAI BANK, LIMITED, NEW YORK BRANCH
By /s/ Stuart M. Schulman
-------------------------
Name: Stuart M. Schulman
Title: Senior Vice President
$ 50,000,000 THE TORONTO DOMINION (NEW YORK), INC.
By /s/ Jorge A. Garcia
----------------------
Name: Jorge A. Garcia
Title: Vice President
$ 50,000,000 UNION BANK OF SWITZERLAND, NEW YORK
BRANCH
By /s/ James P. Kelleher
------------------------
Name: James P. Kelleher
Title: Assistant Vice President
By /s/ Peter B. Yearly
----------------------
Name: Peter B. Yearly
Title: Managing Director
$ 50,000,000 WESTDEUTSCHE LANDESBANK GIROZENTRALE,
NEW YORK BRANCH
By /s/ Salvatore Battinelli
---------------------------
Name: Salvatore Battinelli
Title: Vice President
Credit Department
By /s/ Alan S. Bookspan
-----------------------
Name: Alan S. Bookspan
Title: Vice President
TOTAL COMMITMENTS:
$5,000,000,000
[CONFORMED COPY]
$5,000,000,000
REVOLVING CREDIT AGREEMENT
(5 year)
dated as of
April 15, 1996
among
LOCKHEED MARTIN CORPORATION,
LAC ACQUISITION CORPORATION,
as Guarantor,
The BANKS Listed Herein,
MORGAN GUARANTY TRUST COMPANY OF NEW YORK,
as Documentation Agent,
and
BANK OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION,
as Administrative Agent
TABLE OF CONTENTS*
Page
ARTICLE I
DEFINITIONS
1.01. Definitions.............................................. 1
1.02. Accounting Terms and Determinations...................... 14
ARTICLE II
THE LOANS
2.01. The Committed Loans...................................... 15
2.02. Method of Committed Borrowing............................ 15
2.03. Money Market Borrowings.................................. 16
2.04. Notice to Banks; Funding of Loans........................ 20
2.05. Conversion/Continuation of Loans......................... 22
2.06. Loan Accounts and Notes.................................. 23
2.07. Payment of Principal..................................... 24
2.08. Interest................................................. 24
2.09. Optional Prepayments..................................... 26
2.10. General Provisions as to Payments........................ 27
2.11. Fees..................................................... 28
2.12. Reduction or Termination of Commitments.................. 28
2.13. Lending Offices.......................................... 29
2.14. Reimbursement............................................ 29
ARTICLE III
CONDITIONS
3.01. Conditions to Closing.................................... 30
3.02. Conditions to All Loans.................................. 32
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
4.01. Corporate Existence and Power............................ 32
4.02. No Contravention......................................... 33
4.03. Corporate Authorization; Binding Effect.................. 33
4.04. Financial Information.................................... 33
4.05. Litigation; Taxes........................................ 34
4.06. Margin Regulations....................................... 34
4.07. Governmental Approvals................................... 34
4.08. Pari Passu Obligations................................... 35
4.09. No Defaults.............................................. 35
4.10. Full Disclosure.......................................... 35
4.11. ERISA.................................................... 35
4.12. Environmental Matters.................................... 35
ARTICLE V
COVENANTS
5.01. Information.............................................. 36
5.02. Payment of Obligations................................... 38
5.03. Insurance................................................ 38
5.04. Maintenance of Existence................................. 38
5.05. Maintenance of Properties................................ 39
5.06. Compliance With Laws..................................... 39
5.07. Mergers, Consolidations and Sales of
Assets................................................... 39
5.08. Limitation on Liens...................................... 40
5.09. Leverage Ratio........................................... 43
5.10. Use of Loans............................................. 43
ARTICLE VI
DEFAULTS
6.01. Events of Default........................................ 43
ARTICLE VII
THE AGENTS
7.01. Appointment and Authorization............................ 46
7.02. Agents and Affiliates.................................... 46
7.03. Action by Agents......................................... 47
7.04. Consultation with Experts................................ 47
7.05. Liability of Agents...................................... 47
7.06. Indemnification.......................................... 47
7.07. Credit Decision.......................................... 48
7.08. Successor Agents......................................... 48
7.09. Agents' Fees............................................. 48
ARTICLE VIII
CHANGE IN CIRCUMSTANCES
8.01. Increased Cost and Reduced Return;
Capital Adequacy......................................... 49
8.02. Substitute Rate.......................................... 50
8.03. Illegality............................................... 50
8.04. Taxes on Payments........................................ 51
ARTICLE IX
GUARANTEE
9.01. Unconditional Guarantee.................................. 54
9.02. Discharge; Reinstatement................................. 55
9.03. Limit of Liability....................................... 55
ARTICLE X
MISCELLANEOUS
10.01. Termination of Commitment of a Bank; New
Banks.................................................... 55
10.02. Notices.................................................. 56
10.03. No Waivers............................................... 57
10.04. Expenses; Indemnification................................ 57
10.05. Pro Rata Treatment....................................... 57
10.06. Sharing of Set-Offs...................................... 58
10.07. Amendments and Waivers................................... 58
10.08. Successors and Assigns; Participations;
Novation................................................. 58
10.09. Visitation............................................... 62
10.10. Reference Banks.......................................... 62
10.11. Governing Law; Submission to Jurisdiction................ 62
10.12. Effectiveness; Counterparts; Integration................. 62
10.13. WAIVER OF JURY TRIAL..................................... 62
10.14. Confidentiality.......................................... 63
10.15. Termination and Payment under Existing
Agreements............................................... 63
SCHEDULE I - Pricing
Exhibit A - Notice of Committed Borrowing
Exhibit B - Money Market Quote Request
Exhibit C - Invitation for Money Market Quotes
Exhibit D - Money Market Quote
Exhibit E - Notice of Money Market Borrowing
Exhibit F - Notice of Conversion/Continuation
Exhibit G-1 - Form of Committed Note
Exhibit G-2 - Form of Money Market Note
Exhibits H-1
and H-2 - Opinions of Special Counsel to the Company
Exhibit H-3 - Opinion of General Counsel to the Company
Exhibit I - Opinion of Special Counsel to the Agents
Exhibit J - Compliance Certificate
Exhibit K - Assignment and Assumption Agreement
- --------
* The Table of Contents is not a part of this Agreement.
REVOLVING CREDIT AGREEMENT
AGREEMENT dated as of April 15, 1996 among LOCKHEED MARTIN
CORPORATION, LAC ACQUISITION CORPORATION, as Guarantor, the BANKS listed on
the signature pages hereof, MORGAN GUARANTY TRUST COMPANY OF NEW YORK, as
Documentation Agent, and BANK OF AMERICA NATIONAL TRUST AND SAVINGS
ASSOCIATION, as Administrative Agent.
ARTICLE I
DEFINITIONS
SECTION 1.01. Definitions. The following terms,
as used herein and in any Exhibit or Schedule hereto, have
the following meanings:
"Acquisition" means the acquisition by the Company, through
Acquisition Company, of Loral pursuant to the Merger Agreement, including
the Tender Offer and the Merger.
"Acquisition Company" means LAC Acquisition Corporation, a New
York corporation.
"Adjusted CD Rate" means, with respect to any Interest Period
(but subject to the last sentences of the definitions of Assessment Rate
and Domestic Reserve Percentage), a rate per annum determined pursuant to
the following formula:
[ CDBR ]*
ACDR = [ ---------- ] + AR
[ 1.00 - DRP ]
ACDR = Adjusted CD Rate
CDBR = CD Base Rate
DRP = Domestic Reserve Percentage
AR = Assessment Rate
----------
* The amount in brackets being rounded upward to the next higher
1/100 of 1%
"Administrative Agent" means Bank of America National Trust and
Savings Association in its capacity as administrative agent for the Banks
hereunder, and its successor or successors in such capacity.
"Administrative Questionnaire" means, with respect to each
Bank, an administrative questionnaire in the form prepared by the
Administrative Agent and submitted to the Agents with a copy to the Company
duly completed by such Bank.
"Agents" means the Administrative Agent and the Documentation
Agent, and "Agent" means either of the foregoing.
"Agreement" means this Revolving Credit Agreement as it may be
amended from time to time.
"Applicable Lending Office" means, with respect to any Bank,
(i) in the case of its Domestic Loans, its Domestic Lending Office, (ii) in
the case of its Eurodollar Loans, its Eurodollar Lending Office and (iii)
in the case of its Money Market Loans, its Money Market Lending Office.
"Assessment Rate" means for any day the annual assessment rate
in effect on such day which is payable by a member of the Bank Insurance
Fund classified as adequately capitalized and within supervisory subgroup
"A" (or a comparable successor assessment risk classification) within the
meaning of 12 C.F.R. ss. 327.3(e) (or any successor provision) to the
Federal Deposit Insurance Corporation (or any successor) for such
Corporation's (or such successor's) insuring time deposits at offices of
such institution in the United States. The Adjusted CD Rate shall be
adjusted automatically on and as of the effective date of any change in the
Assessment Rate.
"Assignee" has the meaning set forth in Section 10.08(c).
"Assignment and Assumption Agreement" means an agreement,
substantially in the form of Exhibit K hereto, under which an interest of a
Bank hereunder is transferred to an Assignee pursuant to Section 10.08(c)
hereof.
"Bank" means (i) each bank or financial institution listed on
the signature pages hereof, (ii) each bank or financial institution that
becomes a Bank pursuant to either Section 10.01 or Section 10.08(c), and
(iii) their respective successors.
"Base Rate" means, for any day, a rate per annum equal to the
higher of (i) the Reference Rate for such day or (ii) the sum of 1/2 of 1%
plus the Federal Funds Rate for such day, each change in the Base Rate to
become effective on the day on which such change occurs.
"Base Rate Loan" means any Committed Loan in respect of which
interest is to be computed on the basis of the Base Rate.
"Capitalized Lease Obligations" means any and all monetary
obligations under any leasing arrangements which have been capitalized, as
such obligations are reported in the consolidated financial statements of
the Company and the Consolidated Subsidiaries.
"CD Base Rate" means, with respect to any Interest Period, the
rate of interest determined by the Administrative Agent to be the average
(rounded upward to the next higher 1/100 of 1%) of the prevailing rates per
annum bid at 10:00 a.m. (New York time) (or as soon thereafter as
practicable) on the first day of such Interest Period by two or more
certificate of deposit dealers of recognized standing for the purchase at
face value from each CD Reference Bank of its certificates of deposit in an
amount comparable to the principal amount of the CD Loan of such CD
Reference Bank to which such Interest Period applies and having a maturity
comparable to such Interest Period.
"CD Loan" means any Committed Loan in respect of which interest
is to be computed on the basis of the Adjusted CD Rate.
"CD Margin" means the percentage determined pursuant to Section
2.08(d) and Schedule I.
"CD Reference Banks" means Bank of America National Trust and
Savings Association, Citibank, N.A. and First Interstate Bank of California.
"Change in Law" means, for purposes of Section 8.01 and Section
8.03, the adoption of any applicable law, rule or regulation, or any change
therein, or any change in the interpretation or administration thereof by
any governmental authority, central bank or comparable agency charged with
the interpretation or administration thereof, or compliance by any Bank
with any request or directive (whether or not having the force of law) of
any such authority, central bank or comparable agency.
"Closing Date" means the date, not later than April 30, 1996
(or if the condition referred to in Section 3.01(h) has not been satisfied
on or before such date solely because the waiting period contemplated by
the Hart-Scott- Rodino Act Antitrust Improvements Act of 1976, as amended,
has not expired or otherwise terminated, not later than June 30, 1996), on
which all the conditions referred to in Section 3.01 shall have been
satisfied.
"Commitment" means as to each Bank at any time, the amount set
forth opposite such Bank's name on the signature pages hereof or in the
applicable Assignment and Assumption Agreement, as such amount may be
increased or decreased pursuant to the terms of this Agreement.
"Commitment Termination Date" means April 15, 2001 (or if such
date is not a Domestic Business Day, the next preceding Domestic Business
Day).
"Committed Loan" means a Loan made by a Bank pursuant to
Section 2.01.
"Committed Notes" means promissory notes of the Company,
substantially in the form of Exhibit G-1 hereto, evidencing the obligation
of the Company to repay the Committed Loans, and "Committed Note" means any
one of such promissory notes issued hereunder.
"Company" means Lockheed Martin Corporation, a Maryland
corporation, and its successors.
"Consolidated Subsidiary" means at any date any Subsidiary the
accounts of which would be consolidated with the Company in its
consolidated financial statements if such statements were prepared as of
such date. For purposes of Sections 4.04 and 5.01 and the definition of the
term "Exempt Subsidiary", Consolidated Subsidiary includes any Exempt
Subsidiary.
"Debt" means all indebtedness for borrowed money, ESOP
guarantees and Capitalized Lease Obligations reported as debt in the
consolidated financial statements of the Company and the Consolidated
Subsidiaries, plus all indebtedness for borrowed money and capitalized
lease obligations incurred by third parties and guaranteed by the Company
or a Consolidated Subsidiary not otherwise reported as debt in such
consolidated financial statements.
"Default" means any condition or event which constitutes an
Event of Default or which with the giving of notice or lapse of time or
both would, unless cured or waived, become an Event of Default.
"Designated Representative" means any officer or
employee as shall be so identified in an Officer's
Certificate.
"Documentation Agent" means Morgan Guaranty Trust Company of
New York in its capacity as documentation agent for the Banks hereunder,
and its successors in such capacity.
"Dollars" or "$" means lawful currency of the
United States.
"Domestic Business Day" means any day except a Saturday, Sunday
or other day on which commercial banks in San Francisco or New York are
authorized by law to close.
"Domestic Lending Office" means, as to each Bank, its office
located at its address set forth in its Administrative Questionnaire (or
identified in its Administrative Questionnaire as its Domestic Lending
Office) or such other office as such Bank may hereafter designate as its
Domestic Lending Office by notice to the Company and the Agents; provided
that any Bank may so designate separate Domestic Lending Offices for its
Base Rate Loans, on the one hand, and its CD Loans, on the other hand, in
which case all references herein to the Domestic Lending Office of such
Bank shall be deemed to refer to either or both of such offices, as the
context may require.
"Domestic Loans" means CD Loans or Base Rate
Loans or both.
"Domestic Reserve Percentage" means for any day that percentage
(expressed as a decimal) which is in effect on such day, as prescribed by
the Board of Governors of the Federal Reserve System (or any successor) for
determining the maximum reserve requirement (including without limitation
any basic, supplemental or emergency reserves) for a member bank of the
Federal Reserve System in New York City with deposits exceeding five
billion dollars in respect of new non-personal time deposits in dollars in
New York City having a maturity comparable to the related Interest Period
and in an amount of $100,000 or more. The Adjusted CD Rate shall be
adjusted automatically on and as of the effective date of any change in the
Domestic Reserve Percentage.
"Eligible Institution" means any commercial bank having total
assets in excess of $3,000,000,000 (or the equivalent amount in the local
currency of such bank) as determined by the Documentation Agent based on
the most recent publicly available financial statements of such bank, or
any affiliates thereof that are financial institutions.
"Environmental Laws" means any and all applicable federal,
state and local statutes, regulations, ordinances, rules, administrative
orders, consent decrees, permits, concessions, grants, franchises,
licenses, agreements or other governmental restrictions relating to the
environment or to emissions, discharges or releases of pollutants,
contaminants, hazardous substances, or hazardous wastes into the
environment including, without limitation, ambient air, surface water,
ground water, or land, or otherwise relating to the manufacture,
processing, distribution, use, treatment, storage, disposal, transport or
handling of pollutants, contaminants, hazardous substances, or hazardous
wastes.
"ERISA" means the Employee Retirement Income Security Act of
1974, as in effect from time to time.
"ERISA Group" means the Company and all members of a controlled
group of corporations and all trades or businesses (whether or not
incorporated) under common control that, together with the Company, are
treated as a single employer under Section 414 of the Internal Revenue
Code.
"Eurodollar Auction" means a solicitation of Money Market
Quotes setting forth Money Market Margins based on the Eurodollar Rate
pursuant to Section 2.03.
"Eurodollar Business Day" means any Domestic Business Day on
which commercial banks are open for international business (including
dealings in dollar deposits) in London.
"Eurodollar Lending Office" means, as to each Bank, its office,
branch or affiliate located at its address set forth in its Administrative
Questionnaire (or identified in its Administrative Questionnaire as its
Eurodollar Lending Office) or such other office, branch or affiliate of
such Bank as it may hereafter designate as its Eurodollar Lending Office by
notice to the Company and the Agents.
"Eurodollar Loan" means any Committed Loan in respect of which
interest is to be computed on the basis of the Eurodollar Rate.
"Eurodollar Margin" means the percentage determined pursuant
to Section 2.08(d) and Schedule I.
"Eurodollar Rate" means, in respect of any Eurodollar Loan for
any Interest Period therefor, a rate per annum equal to the arithmetic
average (rounded upwards to the nearest 1/16th of 1%) of the respective
rates per annum at which deposits in Dollars are offered to each of the
Eurodollar Reference Banks in the London interbank market in an amount
approximately equal to the principal amount of the Eurodollar Loan of such
Eurodollar Reference Bank, or, in the case of a Money Market Eurodollar
Loan, the principal amount of such Loan for which the Eurodollar Rate is
being determined for maturities comparable to such Interest Period as of
approximately 11:00 a.m. (London time) two Eurodollar Business Days prior
to the commencement of such Interest Period.
"Eurodollar Reference Banks" means the principal
London offices of Bank of America National Trust and
Savings Association, Barclays Bank PLC and Morgan Guaranty Trust
Company of New York.
"Event of Default" has the meaning set forth in
Section 6.01.
"Exchange Act" means the Securities Exchange Act
of 1934, as amended.
"Exempt Subsidiary" means Lockheed Martin Finance Corporation,
Martin Marietta Materials, Inc. and any other entity of which the Company
owns a sufficient number of securities or other ownership interests having
ordinary voting power to elect a majority of the board of directors or
other governing body that is designated as such pursuant to an Officer's
Certificate; provided that no such designation may be made unless, as of
the end of the most recent fiscal quarter prior to such designation, the
book value, net of depreciation and amortization and after intercompany
eliminations, of the assets of such entity, when aggregated with the book
values, net of depreciation and amortization and after intercompany
eliminations, of the assets of all Exempt Subsidiaries, other than Lockheed
Martin Finance Corporation and Martin Marietta Materials, Inc., does not
exceed 6% of the book value of the total assets of the Company and its
Consolidated Subsidiaries. Exempt Subsidiary includes any direct or
indirect subsidiary of an Exempt Subsidiary.
"Facility Fee" has the meaning set forth in
Section 2.11.
"Failed Loan" has the meaning specified in
Section 2.04(e).
"Federal Funds Rate" means, for any day, the rate per annum
(rounded upward, if necessary, to the nearest 1/100th of 1%) equal to the
weighted average of the rates on overnight Federal funds transactions with
members of the Federal Reserve System arranged by Federal funds brokers on
such day, as published by the Federal Reserve Bank of New York on the
Domestic Business Day next succeeding such day, provided that (i) if such
day is not a Domestic Business Day, the Federal Funds Rate for such day
shall be such rate on such transactions on the next preceding Domestic
Business Day as so published on the next succeeding Domestic Business Day,
and (ii) if no such rate is so published on such next succeeding Domestic
Business Day, the Federal Funds Rate for such day shall be the average rate
quoted to the Administrative Agent on such day on such transactions as
determined by it.
"Fixed Rate Loans" means CD Loans, Eurodollar Loans or Money
Market Loans (excluding Money Market Eurodollar Loans bearing interest at
the Base Rate pursuant to Section 8.03) or any combination of the
foregoing.
"Governmental Authority" means any nation or government, any
state or other political subdivision thereof, any central bank (or similar
monetary or regulatory authority) thereof, any entity exercising executive,
legislative, judicial, regulatory or administrative functions of or
pertaining to government and any corporation or other entity owned or
controlled, through stock or capital ownership or otherwise, by any of the
foregoing.
"Guarantor" means Acquisition Company and its
successors.
"Information Memorandum" means the Lockheed Martin Information
Memorandum -- $10.0 Billion Senior Credit Facilities previously distributed
to the Banks, as amended and supplemented prior to February 16, 1996.
"Interest Period" means: (a) as to each (1) Eurodollar Loan, a
period commencing on the date of borrowing specified in the applicable
Notice of Borrowing or on the date specified in the applicable Notice of
Conversion/Continuation, and ending one, two, three, six or (as provided in
Section 2.08(b)) twelve months thereafter, and (2) Money Market Eurodollar
Loan, the period commencing on the date of borrowing specified in the
applicable Notice of Borrowing and ending such whole number of months
thereafter, in each case as selected by the Company, provided that:
(i) any Interest Period (other than an Interest Period
determined pursuant to clause (iii) below) which would otherwise end
on a day which is not a Eurodollar Business Day shall be extended to
the next succeeding Eurodollar Business Day unless such Eurodollar
Business Day falls in another calendar month, in which case such
Interest Period shall end on the next preceding Eurodollar Business
Day;
(ii) any Interest Period (other than an Interest Period
determined pursuant to clause (iii) below) which begins on the last
Eurodollar Business Day of a calendar month (or on a day for which
there is no numerically corresponding day in the calendar month at
the end of such Interest Period) shall end on the last Eurodollar
Business Day of a calendar month; and
(iii) any Interest Period which would otherwise end after the
Commitment Termination Date shall end on the Commitment Termination
Date; and
(b) as to each (1) CD Loan, a period commencing on the date of borrowing
specified in the applicable Notice of Borrowing or on the date specified in
the applicable Notice of Conversion/Continuation and ending 30, 60, 90 or
180 days thereafter, and (2) Money Market Rate Loan, the period commencing
on the date of borrowing specified in the applicable Notice of Borrowing
and ending such number of days thereafter (but not less than seven days),
in each case as selected by the Company; provided that:
(i) any Interest Period (other than an Interest Period
determined pursuant to clause (ii) below) which would otherwise end
on a day which is not a Eurodollar Business Day shall be extended to
the next succeeding Eurodollar Business Day; and
(ii) any Interest Period which would otherwise end after the
Commitment Termination Date shall end on the Commitment Termination
Date.
"Internal Revenue Code" means the Internal Revenue Code of
1986, as amended, or any successor statute.
"Invitation for Money Market Quotes" means the notice
substantially in the form of Exhibit C hereto to the Banks in connection
with the solicitation by the Company of Money Market Quotes.
"Lien" means any mortgage, pledge, security
interest, lien, or encumbrance.
"Loan" and "Loans" mean and include each and every loan made by
a Bank under this Agreement.
"Loral" means Loral Corporation, a New York
corporation, and its successors.
"Material Adverse Effect" means a material adverse effect on
(a) the ability of the Company and the Guarantor, on a consolidated basis,
to perform their obligations under this Agreement or any of the Notes, (b)
the validity or enforceability of this Agreement or any of the Notes, (c)
the rights and remedies of any Bank or the Agents under this Agreement or
any of the Notes, or (d) the timely payment of the principal of or interest
on the Loans or other amounts payable in connection therewith.
"Material Debt" means Debt (other than Debt evidenced by the
Notes) of the Company and/or one or more of its Subsidiaries, arising in
one or more related or unrelated transactions, in an aggregate principal
amount exceeding $100,000,000.
"Merger" means the merger of Acquisition Company
and Loral contemplated by the Merger Agreement.
"Merger Agreement" means the Agreement and Plan of Merger dated
as of January 7, 1996, among the Company, Loral and Acquisition Company.
"Money Market Eurodollar Loan" means a loan to be made by a
Bank pursuant to a Eurodollar Auction (including such a loan bearing
interest at the Base Rate pursuant to Section 8.03).
"Money Market Lending Office" means, as to each Bank, its
Domestic Lending Office or such other office, branch or affiliate of such
Bank as it may hereafter designate as its Money Market Lending Office by
notice to the Company and the Agents; provided that any Bank may from time
to time by notice to the Company and the Administrative Agent designate
separate Money Market Lending Offices for its Money Market Eurodollar
Loans, on the one hand, and its Money Market Rate Loans, on the other hand,
in which case all references herein to the Money Market Lending Office of
such Bank shall be deemed to refer to either or both of such offices, as
the context may require.
"Money Market Loan" means a Money Market
Eurodollar Loan or a Money Market Rate Loan.
"Money Market Margin" has the meaning set forth
in Section 2.03(d).
"Money Market Notes" means promissory notes of the Company,
substantially in the form of Exhibit G-2 hereto, evidencing the obligation
of the Company to repay the Money Market Loans, and "Money Market Note"
means any one of such promissory notes issued hereunder.
"Money Market Quote" means an offer by a Bank, in substantially
the form of Exhibit D hereto, to make a Money Market Loan in accordance
with Section 2.03.
"Money Market Quote Request" means the notice, in substantially
the form of Exhibit B hereto, to be delivered by the Company in accordance
with Section 2.03 in requesting Money Market Quotes.
"Money Market Rate" has the meaning set forth in
Section 2.03(d).
"Money Market Rate Loan" means a Loan to be made by a Bank
pursuant to a Rate Auction.
"Moody's" means Moody's Investors Service, Inc.
and its successors.
"Multiemployer Plan" means at any time an employee pension
benefit plan within the meaning of Section 4001(a)(3) of ERISA to which any
member of the ERISA Group is then making or accruing an obligation to make
contributions.
"Note" or "Notes" has the meaning set forth in
Section 2.06.
"Notice of Borrowing" means a Notice of Committed Borrowing (as
defined in Section 2.02) or a Notice of Money Market Borrowing (as defined
in Section 2.03(f)).
"Notice of Conversion/Continuation" has the
meaning set forth in Section 2.05.
"Officer's Certificate" means a certificate
signed by an officer of the Company.
"Original Commitment" means $5,000,000,000.
"Other Taxes" has the meaning set forth in
Section 8.04.
"Parent" means with respect to any Bank, any
Person controlling such Bank.
"Participant" has the meaning set forth in
Section 10.08(b).
"PBGC" means the Pension Benefit Guaranty
Corporation or any entity succeeding to any or all of its
functions under ERISA.
"Person" means any individual, firm, company, corporation,
joint venture, joint-stock company, limited liability company or
partnership, trust, unincorporated organization, government or state
entity, or any association or partnership (whether or not having separate
legal personality) of two or more of the foregoing.
"Plan" means at any time an employee pension benefit plan
(other than a Multiemployer Plan) that is covered by Title IV of ERISA or
subject to the minimum funding standards under Section 412 of the Internal
Revenue Code and is maintained, or contributed to, by any member of the
ERISA Group for employees of any member of the ERISA Group.
"Post-Default Rate" means, with respect to any Loan or any
interest payment at any date on or after the due date of such Loan or
interest payment, a rate per annum equal to the sum of 2% plus the Base
Rate for such date.
"Principal Property" means, at any time, any manufacturing
facility that is located in the United States, is owned by the Company or
any of its Subsidiaries, and has a book value, net of any depreciation or
amortization, pursuant to the then most recently delivered financial
statements, in excess of $5,000,000.
"Quarterly Date" means the last day of March, June, September
and December in each year, commencing June 30, 1996.
"Rate Auction" means a solicitation of Money Market Quotes
setting forth Money Market Rates pursuant to Section 2.03.
"Rating Agency" means either of Moody's or S&P.
"Reference Banks" means the CD Reference Banks or the
Eurodollar Reference Banks, as the context may require, and "Reference
Bank" means any one of such Reference Banks.
"Reference Rate" means the rate of interest publicly announced
by Bank of America National Trust and Savings Association in San Francisco
from time to time as its "reference rate" (which is a rate set by Bank of
America National Trust and Savings Association based on various factors
including its costs and desired return, general economic conditions and
other factors, and is used as a reference point for pricing some loans,
which may be priced at, above or below such announced rate); any change in
the Reference Rate shall take effect on the day specified in the public
announcement of such change.
"Regulation U" means Regulation U of the Board of Governors of
the Federal Reserve System, as in effect from time to time.
"Required Banks" means at any time and for any specific purpose
the Bank or Banks having, in the aggregate, more than 50% of the Total
Commitments, or, if the Commitments have terminated, more than 50% of the
Loans.
"Restricted Subsidiary" means (x) any Significant Subsidiary,
(y) any Subsidiary that has substantially all of its property located in
the United States and that owns a Principal Property and (z) any Subsidiary
theretofore designated a Restricted Subsidiary pursuant to the next
sentence and not subsequently designated not a Restricted Subsidiary
pursuant to the sentence thereafter. If at the end of any fiscal quarter
ending on or after June 30, 1996, the aggregate principal amount of Debt of
the Company and its Subsidiaries secured by Liens exceeds $100,000,000 and
the aggregate total assets (net of depreciation and, amortization, and
after intercompany eliminations, but without giving effect, as to any
Restricted Subsidiary pursuant to clause (z) above, to assets encumbered by
Liens to secure Debt) of the Company and all of its Restricted Subsidiaries
("Total Restricted Assets") are less than 85% of the total assets of the
Company and its Subsidiaries (net of depreciation and amortization, and
after intercompany eliminations, but without giving effect, as to any
Restricted Subsidiary pursuant to clause (z) above, to assets encumbered by
Liens to secure Debt) ("Total Assets"), then the Company shall, not later
than the date on which financial statements for the fiscal period then
ending are required to be delivered pursuant to this Agreement, designate
other Subsidiaries as Restricted Subsidiaries such that, after giving
effect thereto, Total Restricted Assets equal or exceed 85% of Total
Assets. If at the end of any fiscal quarter, Total Restricted Assets are
more than 85% of Total Assets, the Company may designate Restricted
Subsidiaries which are not then Restricted Subsidiaries pursuant to clause
(x) or (y) above as being no longer Restricted Subsidiaries, provided that
after giving effect thereto, Total Restricted Assets equal or exceed 85% of
Total Assets. Subsidiaries of a Restricted Subsidiary are not Restricted
Subsidiaries solely by virtue of such subsidiary status.
"Retiring Bank" has the meaning set forth in
Section 10.01(a).
"S&P" means Standard & Poor's Ratings Group and
its successors.
"Significant Subsidiary" means a Subsidiary with a book value
of total assets, net of depreciation and amortization and after
intercompany eliminations, in excess of $100,000,000.
"Stockholders' Equity" means consolidated stockholders' equity
of the Company and the Consolidated Subsidiaries reported as stockholders'
equity on the consolidated balance sheet of the Company and the
Consolidated Subsidiaries.
"Subsidiary" means any corporation or other entity of which
securities or other ownership interests having ordinary voting power to
elect a majority of the Board of Directors or other persons performing
similar functions are at the time directly or indirectly owned by the
Company, other than any such corporation or other entity that is an Exempt
Subsidiary.
"Taxes" has the meaning set forth in Section 8.04.
"Tender Offer" means the tender offer for shares of Loral
contemplated by the Merger Agreement.
"Total Commitments" means, at the time for any
determination thereof, the aggregate of the Commitments of
the Banks.
"Total Usage" means, as to any Bank at any time of
determination, the sum of (i) the aggregate principal amount of all
Committed Loans by such Bank at such time outstanding and (ii) the product
derived by multiplying (a) the aggregate principal amount of all Money
Market Loans at such time outstanding and (b) the quotient derived by
dividing such Bank's Commitment by Total Commitments.
"Transferee" has the meaning set forth in
Section 10.08(e).
"United States" means the United States of America, including
the States and the District of Columbia, but excluding the Commonwealths,
territories and possessions of the United States.
"Unfunded Liabilities" means, with respect to any Plan at any
time, the amount (if any) by which (i) the present value of all benefits
under such Plan exceeds (ii) the fair market value of all Plan assets
allocable to such benefits (excluding any accrued but unpaid
contributions), all determined as of the then most recent valuation date
for such Plan, but only to the extent that such excess represents a
potential liability of a member of the ERISA Group to the PBGC or an
appointed trustee under Title IV of ERISA.
SECTION 1.02. Accounting Terms and Determinations. Unless
otherwise specified herein, all accounting terms used herein shall be
interpreted, all accounting determinations hereunder shall be made, and all
financial statements required to be delivered hereunder shall be prepared
in accordance with generally accepted accounting principles as in effect
from time to time applied on a basis consistent (except for changes
concurred in by the Company's independent public accountants) with the most
recent audited consolidated financial statements of the Company and its
Consolidated Subsidiaries delivered to the Banks; provided that, if the
Company notifies the Documentation Agent that the Company wishes to amend
any covenant contained in Article V to eliminate the effect of any change
after the date hereof in generally accepted accounting principles (which,
for purposes of this proviso shall include the generally accepted
application or interpretation thereof) on the operation of such covenant
(or if the Documentation Agent notifies the Company that the Required Banks
wish to amend any such covenant for such purpose), then the Company's
compliance with such covenant shall be determined on the basis of generally
accepted accounting principles in effect immediately before the relevant
change in generally accepted accounting principles is adopted by the
Company, until either such notice is withdrawn or such covenant is amended
in a manner satisfactory to the Company and the Required Banks.
ARTICLE II
THE LOANS
SECTION 2.01. The Committed Loans. On or after the Closing Date
each of the Banks severally agrees, upon the terms and conditions of this
Agreement, to make Loans to the Company under this Section 2.01 from time
to time prior to the Commitment Termination Date or the termination in full
of such Bank's Commitment, whichever is earlier, such that the Total Usage
at any time shall not exceed such Bank's Commitment in effect at such time.
Within such limits, the Company may borrow, repay and reborrow under this
Section 2.01. Each borrowing from the Banks shall be in an aggregate amount
of not less than $10,000,000 and in multiples of $1,000,000.
SECTION 2.02. Method of Committed Borrowing. The Company shall
give the Administrative Agent written or telephonic notice (a "Notice of
Committed Borrowing") no later than 1:00 p.m. (New York time) or, with
respect to any Base Rate Loan, 11:00 a.m. (New York time) (i) at least
three Eurodollar Business Days before the date of each borrowing hereunder
on the basis of the Eurodollar Rate (or at least four Eurodollar Business
Days before the date of a borrowing hereunder with an Interest Period of
twelve months in accordance with Section 2.08(b)), (ii) at least two
Domestic Business Days before the date of each borrowing hereunder on the
basis of the Adjusted CD Rate and (iii) on the day of each borrowing
hereunder on the basis of the Base Rate, specifying in each case the date
of such borrowing, which shall be a Domestic Business Day in the case of a
Domestic Loan or a Eurodollar Business Day in the case of a Eurodollar
Loan, the amount to be borrowed, any election as between the Base Rate, the
Adjusted CD Rate and the Eurodollar Rate, and, if the Eurodollar Rate or
Adjusted CD Rate is elected, a selection of the applicable Interest Period.
A written Notice of Committed Borrowing shall be executed by an officer or
a Designated Representative and shall be substantially in the form of
Exhibit A hereto. A telephonic notice hereunder may only be provided by an
officer or a Designated Representative, such notice to be promptly followed
by a written Notice of Committed Borrowing executed as set forth above.
SECTION 2.03. Money Market Borrowings.
(a) In addition to Committed Loans pursuant to Section 2.01,
the Company may, as set forth in this Section 2.03 from time to time prior
to the Commitment Termination Date or earlier termination of the
Commitments, request the Banks to make offers to make Money Market Loans to
the Company, but only to the extent that any such Money Market Loans
together with all other outstanding Loans do not exceed the Total
Commitments. Such Banks may, but shall have no obligation to, make such
offers and the Company may, but shall have no obligation to, accept any
such offers in the manner set forth in this Section.
(b) When the Company wishes to request offers to make Money
Market Loans under this Section, it shall transmit to the Administrative
Agent by facsimile transmission a Money Market Quote Request so as to be
received no later than 1:00 p.m. (New York time) on (x) the fourth
Eurodollar Business Day prior to the date of the Loan proposed therein, in
the case of a Eurodollar Auction or (y) the Domestic Business Day next
preceding the date of the Loan proposed therein, in the case of a Rate
Auction (or, in either case, such other time or date as the Company and the
Administrative Agent shall have mutually agreed and shall have notified the
Banks not later than the date of the Money Market Quote Request for the
first Eurodollar Auction or Rate Auction for which such change is to be
effective) specifying:
(i) the proposed funding date of such Loan, which shall be a
Eurodollar Business Day in the case of a Eurodollar Auction or a
Domestic Business Day in the case of a Rate Auction,
(ii) the aggregate amount of such Loan, which
shall be $10,000,000 or a larger multiple of
$1,000,000,
(iii) the duration of the Interest Period
applicable thereto, subject to the provisions of the
definition of Interest Period,
(iv) the interest payment date or dates
applicable thereto, and
(v) whether the Money Market Quotes requested are to set forth
a Money Market Margin or a Money Market Rate.
The Company may request offers to make Money Market Loans for more than one
Interest Period in a single Money Market Quote Request.
(c) Promptly upon receipt of a Money Market Quote Request, the
Administrative Agent shall send to the Banks by facsimile transmission an
Invitation for Money Market Quotes, which shall constitute an invitation by
the Company to each such Bank to submit Money Market Quotes offering to
make the Money Market Loans to which such Money Market Quote Request
relates in accordance with this Section.
(d)(i) Each Bank may submit a Money Market Quote containing an
offer or offers to make Money Market Loans in response to any Invitation
for Money Market Quotes. Each Money Market Quote must comply with the
requirements of this subsection (d) and must be submitted to the
Administrative Agent by facsimile transmission at its offices specified on
the signature pages hereto not later than (x) 10:45 a.m. (New York time) on
the third Eurodollar Business Day prior to the proposed date of borrowing,
in the case of a Eurodollar Auction or (y) 9:15 a.m. (New York time) on the
proposed date of borrowing, in the case of a Rate Auction (or, in either
case, such other time or date as the Company and the Administrative Agent
shall have mutually agreed and shall have notified the Banks not later than
the date of the Money Market Quote Request for the first Eurodollar Auction
or Rate Auction for which such change is to be effective); provided that
Money Market Quotes submitted by the Administrative Agent (or any affiliate
of the Administrative Agent) in the capacity of a Bank may be submitted,
and may only be submitted, if the Administrative Agent or such affiliate in
the capacity of a Bank notifies the Administrative Agent of the terms of
the offer or offers contained therein not later than 15 minutes prior to
the deadline for the other Banks. Subject to Articles III and VI, any Money
Market Quote so made shall be irrevocable except with the written consent
of the Administrative Agent given on the instructions of the Company.
(ii) Each Money Market Quote shall specify:
(A) the proposed date of borrowing,
(B) the principal amount of the Money Market Loan for which
each such offer is being made, which principal amount (w) may be
greater than or less than the Commitment of the quoting Bank, (x)
must be $5,000,000 or a larger multiple of $1,000,000, (y) may not
exceed the principal amount of Money Market Loans for which offers
were requested and (z) may be subject to an aggregate limitation as
to the principal amount of Money Market Loans for which offers being
made by such quoting Bank may be accepted,
(C) in the case of a Eurodollar Auction, the margin above or
below the applicable Eurodollar Rate (the "Money Market Margin")
offered for each such Money Market Loan, expressed as a percentage
(specified to the nearest 1/10,000th of 1%) to be added to or
subtracted from such Eurodollar Rate,
(D) in the case of a Rate Auction, the rate of interest per
annum (specified to the nearest 1/10,000th of 1%) (the "Money Market
Rate") offered for each such Money Market Loan, and
(E) the identity of the quoting Bank.
A Money Market Quote may set forth up to five separate offers by the
quoting Bank with respect to each Interest Period specified in the related
Invitation for Money Market Quotes.
(iii) Any Money Market Quote shall be disregarded
if it:
(A) is not substantially in conformity with
Exhibit D hereto or does not specify all of the
information required by subsection(d)(ii);
(B) contains qualifying, conditional or similar
language;
(C) proposes terms other than or in addition to those set forth
in the applicable Invitation for Money Market Quotes; or
(D) arrives after the time set forth in subsection (d)(i).
(e) The Administrative Agent shall promptly notify the Company
of the terms (x) of any Money Market Quote submitted by a Bank that is in
accordance with subsection (d) and (y) of any Money Market Quote that
amends, modifies or is otherwise inconsistent with a previous Money Market
Quote submitted by such Bank with respect to the same Money Market Quote
Request. Any such subsequent Money Market Quote shall be disregarded by the
Administrative Agent unless such subsequent Money Market Quote is submitted
solely to correct a manifest error in such former Money Market Quote. The
Administrative Agent's notice to the Company shall specify (A) the
aggregate principal amount of Money Market Loans for which offers have been
received for each Interest Period specified in the related Money Market
Quote Request, (B) the respective principal amounts and Money Market
Margins or Money Market Rates, as the case may be, so offered and (C), if
applicable, any limitations on the aggregate principal amount of Money
Market Loans for which offers in any single Money Market Quote may be
accepted.
(f) Not later than (x) 1:00 p.m. (New York time) on the third
Eurodollar Business Day prior to the proposed date of borrowing, in the
case of a Eurodollar Auction, or (y) 11:00 a.m. (New York time) on the
proposed date of borrowing, in the case of a Rate Auction (or, in either
case, such other time or date as the Company and the Administrative Agent
shall have mutually agreed and shall have notified to the Banks not later
than the date of the Money Market Quote Request for the first Eurodollar
Auction or Rate Auction for which such change is to be effective), the
Company shall notify the Administrative Agent by telephonic notice of its
acceptance or non-acceptance of the offers so notified to it pursuant to
subsection (e). A telephonic notice hereunder may only be provided by an
officer or a Designated Representative. In the case of acceptance, such
telephonic notice shall be promptly followed by a written notice executed
by an officer or a Designated Representative (a "Notice of Money Market
Borrowing"), substantially in the form of Exhibit E hereto, specifying the
aggregate principal amount of offers for each Interest Period that are
accepted. The Company may accept any Money Market Quote in whole or in
part; provided that:
(i) the aggregate principal amount of each borrowing of Money
Market Loans may not exceed the applicable amount set forth in the
related Money Market Quote Request,
(ii) the principal amount of each borrowing of
Money Market Loans must be $10,000,000 or a larger
multiple of $1,000,000,
(iii) acceptance of offers may only be made on the basis of
ascending Money Market Margins or Money Market Rates, as the case may
be, and
(iv) the Company may not accept any offer that is described in
subsection (d)(iii) or that otherwise fails to comply with the
requirements of this Agreement.
(g) If offers are made by two or more Banks with the same Money
Market Margins or Money Market Rates, as the case may be, for a greater
aggregate principal amount than the amount in respect of which such offers
are accepted for the related Interest Period, the principal amount of Money
Market Loans in respect of which such offers are accepted shall be
allocated by the Administrative Agent among such Banks as nearly as
possible (in multiples of $1,000,000, as the Administrative Agent may deem
appropriate) in proportion to the aggregate principal amounts of such
offers. Determinations by the Administrative Agent of the amounts of Money
Market Loans shall be conclusive in the absence of manifest error.
SECTION 2.04. Notice to Banks; Funding of Loans. (a) Upon
receipt of a Notice of Borrowing, the Administrative Agent shall give each
Bank prompt notice of each such borrowing, specifying the relevant
information including such Bank's portion of such borrowing (if any) and
the date on which funds are to be made available. If a Notice of Borrowing
is revoked by the Company after receipt thereof by the Administrative
Agent, the Company shall be subject to the provisions of Section 2.14.
(b) Not later than 1:00 p.m. (New York time) on the date
specified by the Administrative Agent pursuant to Section 2.04(a), each
Bank participating therein shall make available its share of such
borrowing, in Dollars, in immediately available funds, to the
Administrative Agent at its address referred to in Section 10.02. Unless
(i) the Administrative Agent has not received a written Notice of Borrowing
pursuant to Section 2.02 or 2.03(f) or (ii) the Administrative Agent
determines that any applicable condition set forth in Article III has not
been satisfied, the amounts so received by the Administrative Agent shall
be made available immediately upon receipt, but not later than 4:00 p.m.
(New York time) on such date, to the Company by wire transfer in Dollars,
in immediately available funds, to an account of the Company maintained at
a financial institution located in the United States designated by the
Company to the Administrative Agent.
(c) Unless the Administrative Agent shall have received notice
from a Bank at least one Domestic Business Day prior to the date of the
borrowing that such Bank will not make available to the Administrative
Agent such Bank's share of the borrowing, the Administrative Agent may
assume that such Bank has made such share available to the Administrative
Agent on the date of the borrowing in accordance with subsection (b) of
this Section 2.04 and the Administrative Agent may, in reliance upon such
assumption, make available to the Company on such date a corresponding
amount. If and to the extent that such Bank shall not have so made such
share available to the Administrative Agent, such Bank and the Company
severally agree to repay to the Administrative Agent forthwith on demand
such corresponding amount together with interest thereon, for each day from
the date such amount is made available to the Company until the date such
amount is repaid to the Administrative Agent, at the Federal Funds Rate. If
such Bank shall repay to the Administrative Agent such corresponding
amount, such amount so repaid shall constitute such Bank's Loan for
purposes of this Agreement, and the Company shall not be required to repay
such amount pursuant to this subsection (c).
(d) The failure of any Bank to make a Loan required to be made
by it as part of any borrowing hereunder shall not relieve any other Bank
of its obligation, if any, hereunder to make its Loan on the date of such
borrowing, but no Bank shall be responsible for the failure of any other
Bank to make the Loan to be made by such other Bank on the date of the
borrowing.
(e) If any Bank shall fail to make any Loan (the "Failed Loan")
which such Bank is otherwise obligated hereunder to make to the Company on
the date of borrowing thereof and the Agents shall not have received notice
from the Company or such Bank that any condition precedent to the making of
the Failed Loan has not been satisfied, then, until such Bank shall have
made or be deemed to have made (pursuant to the last sentence of this
subsection (e)) the Failed Loan in full or the Documentation Agent shall
have received notice from the Company or such Bank that any condition
precedent to the Failed Loan was not satisfied at the time the Failed Loan
was to have been made, whenever the Administrative Agent shall receive any
amount from the Company for the account of such Bank, (i) the amount so
received will, upon receipt by the Administrative Agent, be deemed to have
been paid to the Bank in satisfaction of the obligation for which paid,
without actual disbursement of such amount to the Bank, (ii) the Bank will
be deemed to have made the same amount available to the Administrative
Agent for disbursement as a Loan to the Company up to the amount of such
Failed Loan and (iii) the Administrative Agent will, accordingly, disburse
such amount (up to the amount of the Failed Loan) to the Company or, if the
Administrative Agent has previously made such amount available to the
Company on behalf of such Bank pursuant to the provisions hereof, reimburse
itself (up to the amount of the amount made available to the Company);
provided, however, that the Administrative Agent shall have no obligation
to disburse any such amount to the Company or otherwise apply it or deem it
applied as provided herein unless the Administrative Agent shall have
determined in its sole discretion that to so disburse such amount will not
violate any law, rule, regulation or requirement applicable to the
Administrative Agent. Upon any such disbursement by the Administrative
Agent, such Bank shall be deemed to have made a Base Rate Loan to the
Company in satisfaction, to the extent thereof, of such Bank's obligation
to make the Failed Loan. If and during the time that a Failed Loan shall
exist, the Company shall have the right to terminate in full the Commitment
of the Bank causing such Failed Loan as provided in Section 10.01(a).
SECTION 2.05. Conversion/Continuation of Loans. (a) With
respect to Committed Loans, the Company shall have the option to (i)
convert all or any part of (A) outstanding Base Rate Loans equal to
$10,000,000 and multiples of $1,000,000 in excess of that amount to
Eurodollar Loans or CD Loans and (B) outstanding Eurodollar Loans equal to
$10,000,000 and multiples of $1,000,000 in excess of that amount to Base
Rate Loans or CD Loans and (C) outstanding CD Loans equal to $10,000,000
and multiples of $1,000,000 in excess of that amount to Base Rate Loans or
Eurodollar Loans, or (ii) upon the expiration of any Interest Period
applicable to outstanding Eurodollar Loans or CD Loans, to continue all or
any portion of such Loans equal to $10,000,000 and multiples of $1,000,000
in excess of that amount as Eurodollar Loans or CD Loans, as the case may
be. The Interest Period of any Base Rate Loan, Eurodollar Loan or CD Loan
converted to a Fixed Rate Loan pursuant to clause (i) above shall commence
on the date of such conversion. The succeeding Interest Period of any Fixed
Rate Loan continued pursuant to clause (ii) above shall commence on the
last day of the Interest Period of the Loan so continued. Eurodollar Loans
and CD Loans may only be converted on the last day of the then current
Interest Period applicable thereto or on the date required pursuant to
Section 8.03.
(b) The Company shall deliver a written or telephonic notice of
such continuation or conversion (a "Notice of Conversion/Continuation") to
the Administrative Agent no later than (x) 1:00 p.m. (New York time) at
least three Eurodollar Business Days (four Eurodollar Business Days if the
Interest Period is for twelve months) in advance of the date of the
proposed conversion to, or continuation of, a Eurodollar Loan, (y) 1:00
p.m. (New York time) at least two Domestic Business Days in advance of the
date of the proposed conversion to, or continuation of, a CD Loan and (z)
11:00 a.m. (New York time) on the day of a conversion to a Base Rate Loan.
A written Notice of Conversion/Continuation shall be executed by an officer
or a Designated Representative, shall be in substantially the form attached
as Exhibit F and shall specify: (i) the proposed conversion/continuation
date (which shall be a Eurodollar Business Day in the case of a Eurodollar
Loan or a Domestic Business Day in the case of a CD Loan or Base Rate
Loan), (ii) the aggregate amount of the Loans being converted/continued,
(iii) an election between the Base Rate, the Adjusted CD Rate and the
Eurodollar Rate and (iv), in the case of a conversion to, or a continuation
of, CD Loans or Eurodollar Loans, the requested Interest Period. A
telephonic Notice of Conversion/Continuation may only be provided by an
officer or a Designated Representative, which notice must be promptly
followed by a written Notice of Conversion/Continuation executed as set
forth above. Upon receipt of a Notice of Conversion/Continuation, the
Administrative Agent shall give each Bank prompt notice of the contents
thereof and such Bank's pro rata share of all conversions and continuations
requested therein. If no timely Notice of Conversion/Continuation is
delivered by the Company as to any Eurodollar Loan or CD Loan and such Loan
is not repaid by the Company at the end of the applicable Interest Period,
such Loan shall be converted to a Base Rate Loan.
SECTION 2.06. Loan Accounts and Notes.
(a) Except as provided in subsection (b) below, the Committed
Loans and Money Market Loans of each Bank shall be evidenced by a loan
account in the Company's name maintained by such Bank and the
Administrative Agent in the ordinary course of business. Such loan account
maintained by the Administrative Agent shall be conclusive evidence absent
manifest error of the amount of the Loan made by such Bank to the Company,
the interest accrued and payable thereon and all interest and principal
payments made thereon. Any failure so to record or any error in doing so
shall in no way limit or otherwise affect the obligation of the Company
hereunder to pay any amount owing with respect to the Loans.
(b) Upon written request made to the Documentation Agent by a
Bank, the Company shall deliver to the Documentation Agent for such Bank a
single Committed Note and a single Money Market Note, if applicable,
evidencing the Committed Loans and the Money Market Loans, respectively, of
such requesting Bank, payable to the order of each such Bank for the
account of its Applicable Lending Office. Each such Note shall be in
substantially the form of Exhibit G-1 or G-2 hereto, as appropriate. Each
reference in this Agreement to the "Note" or "Notes" of such Bank shall be
deemed to refer to and include any or all of such Notes, as the context may
require.
(c) Upon receipt from the Company of the requesting Bank's
Note, the Documentation Agent shall forward such Note to such Bank. Such
Bank shall record the date and amount of each Loan made by it and the date
and amount of each payment of principal made by the Company with respect
thereto, and may, if such Bank so elects in connection with any transfer or
enforcement of its Note, endorse on the schedule forming a part thereof
appropriate notations to evidence the foregoing information with respect to
each such Loan then outstanding; provided that the failure of any Bank that
has requested a Note to make any such recordation or endorsement shall not
affect the obligations of the Company hereunder or under the Note. Each
Bank that receives a Note from the Company is hereby irrevocably authorized
by the Company to so endorse its Note and to attach to and make a part of
its Note a continuation of any such schedule as and when required.
SECTION 2.07. Payment of Principal. (a) Each Committed Loan
shall fall due and be paid as to principal (i) on the Commitment
Termination Date and (ii) on any date that the aggregate principal amount
of all Loans then outstanding exceeds Total Commitments, but ratably only
to the extent of such excess.
(b) Each Money Market Loan shall fall due and be paid as to
principal on the last day of the Interest Period applicable to such Loan.
SECTION 2.08. Interest. Payment of interest on
the Loans shall be in accordance with the following:
(a) Interest shall, subject to any decrease or increase
pursuant to clause (d) of this Section 2.08, accrue (x) on each Base Rate
Loan for each day at a rate per annum equal to the Base Rate for such day,
(y) on each CD Loan for each day during each period commencing on the first
day of an Interest Period therefor to but excluding the last day of such
Interest Period at a rate per annum equal to the sum of the CD Margin for
such day plus the Adjusted CD Rate applicable to such Interest Period, and
(z) on each Eurodollar Loan for each day during each period commencing on
the first day of an Interest Period therefor to but excluding the last day
of such Interest Period, at a rate per annum equal to the sum of the
Eurodollar Rate for such Interest Period plus the Eurodollar Margin for
such day, all as selected and specified in a notice to the Administrative
Agent furnished pursuant to Section 2.02 or Section 2.05; provided that:
(i) each selection by the Company as between the Base
Rate, the Adjusted CD Rate and the Eurodollar Rate shall be made, as
among the Banks, pro rata in accordance with their respective
Commitments, except as variation from such pro-rationing may be
required by virtue of suspension as to a particular Bank of its
Commitment to make Eurodollar Loans, as contemplated by Section
8.03(a); and
(ii) subject to the other provisions of this Section 2.08,
there may be outstanding hereunder at the same time Committed Loans
(or portions thereof) which are Base Rate Loans, other Committed
Loans (or portions thereof) which are CD Loans and other Committed
Loans (or portions thereof) which are Eurodollar Loans.
(b) If requested to do so by the Company, through the
Administrative Agent, at least six Eurodollar Business Days before the
beginning of any Interest Period applicable to a Eurodollar Loan, each Bank
will advise the Company, through the Administrative Agent, before 10:00
a.m. (New York time) four Eurodollar Business Days preceding the beginning
of such Interest Period, as to whether such Bank consents to the selection
by the Company of a duration of twelve months for such Interest Period. If,
but only if, all of the Banks so consent, the Company shall be entitled to
select a duration of twelve months for such Interest Period pursuant to
Section 2.02 or 2.05.
(c) Interest accrued on a Base Rate Loan shall be paid on each
Quarterly Date and on the Commitment Termination Date. Interest accrued on
a CD Loan or a Eurodollar Loan shall be paid (i) on the last day of the
Interest Period for such Loan, (ii) in the case of a Eurodollar Loan with
an Interest Period of twelve months, on the date which is six months from
the first day of such Interest Period and (iii) on the date of any
prepayment pursuant to Section 2.09 or conversion pursuant to Section 8.03
(but only to the extent accrued with respect to the amount being prepaid or
converted). Interest accrued on a Money Market Loan shall be paid on the
last day of the Interest Period for such Loan, the date of any prepayment
pursuant to Section 2.09 or conversion pursuant to Section 8.03 or as
provided in the Money Market Quote Request for such Loan.
(d) Each of the CD Margin and the Eurodollar Margin shall be
determined by reference to the senior unsecured long-term debt ratings of
the Company, or the senior unsecured long-term debt ratings of the Company
(as guaranteed by the Guarantor), whichever is higher, by S&P and Moody's,
as specified on Schedule I hereto. Any change in the CD Margin or the
Eurodollar Margin, as applicable, shall become effective on the day on
which such a Rating Agency shall publicly announce a change in such rating.
(e) Subject to Section 8.03, each Money Market Eurodollar Loan
shall bear interest on the outstanding principal amount thereof, for the
Interest Period applicable thereto, at a rate per annum equal to the sum of
the Eurodollar Rate for such Interest Period (determined as if the Money
Market Eurodollar Loan were a Eurodollar Loan) plus (or minus) the Money
Market Margin quoted by the Bank making such Loan in accordance with
Section 2.03. Each Money Market Rate Loan shall bear interest on the
outstanding principal amount thereof, for the Interest Period applicable
thereto, at a rate per annum equal to the Money Market Rate quoted by the
Bank making such Loan in accordance with Section 2.03.
(f) Interest on past-due principal and interest shall accrue at
the Post-Default Rate during the period from and including the due date
thereof to but excluding the date that such amount is paid and shall be
payable on demand.
(g) The Administrative Agent shall determine, in accordance
with the provisions of this Agreement, each Base Rate, Eurodollar Rate and
Adjusted CD Rate applicable to the Committed Loans hereunder. The
Administrative Agent shall give prompt notice to the Company and the Banks
of each rate of interest so determined, and its determination thereof shall
be conclusive in the absence of manifest error.
(h) Each Reference Bank agrees to use its best efforts to
furnish quotations to the Administrative Agent by the times such quotations
are required to be furnished here- under. If any Reference Bank does not
furnish a timely quotation, the Administrative Agent shall determine the
relevant interest rate on the basis of the quotation or quotations
furnished by the remaining Reference Bank or Banks or, if none of such
quotations is available on a timely basis, the provisions of Section 8.02
shall apply.
(i) Interest on Fixed Rate Loans and Base Rate Loans (if the
Federal Funds Rate is the basis for the effective rate of interest) shall
be computed on the basis of a year of 360 days and paid for the actual
number of days elapsed, calculated as to each Interest Period (or period
ending on a repayment date or date of conversion to a CD Loan or a
Eurodollar Loan or prepayment date selected pursuant to Section 2.09 or
required pursuant to Section 8.03) from and including the first day thereof
to but excluding the last day thereof. Interest on Base Rate Loans (if the
Reference Rate is the effective rate of interest) shall be computed on the
basis of a year of 365 or 366 days, as the case may be, and paid for the
actual number of days elapsed, calculated from and including the date of
such Base Rate Loan to but excluding the date of repayment or conversion of
such Loan to a Fixed Rate Loan.
SECTION 2.09. Optional Prepayments. (a) The Company may, upon
notice to the Administrative Agent not later than 11:30 a.m. (New York
time) on the date of such prepayment, prepay Base Rate Loans (without
penalty or premium), or any Money Market Loan bearing interest at the Base
Rate pursuant to Section 8.03 (without penalty or premium), in whole at any
time, or from time to time in part in amounts aggregating not less than
$10,000,000.
(b) Subject to Section 2.14, the Company may, upon at least one
Domestic Business Day's notice (delivered not later than 1:00 p.m. (New
York time)) to the Administrative Agent, in the case of CD Loans, or upon
at least three Eurodollar Business Days' notice to the Administrative
Agent, in the case of Eurodollar Loans, prepay such Loans, in whole at any
time, or from time to time in part in amounts aggregating not less than
$10,000,000, by paying the principal amount to be prepaid together with
accrued interest thereon to the date of prepayment.
(c) Except as provided in subsection (a) above, the Company may
not prepay all or any portion of the principal amount of any Money Market
Loan prior to the maturity thereof.
(d) Upon receipt of a notice of prepayment, the Administrative
Agent shall give each Bank prompt notice of the contents thereof and the
amount of such Bank's Loans being prepaid pursuant thereto.
SECTION 2.10. General Provisions as to Payments.
(a) All payments by the Company of principal, interest, Facility Fee
and other charges under this Agreement shall be made not later
than 2:00 p.m. (New York time) on the date when due, in Dollars, in
immediately available funds, to the Administrative Agent at its address
referred to in Section 10.02. If a Fed-Wire reference or tracer number has
been received, from the Company or otherwise, by the Administrative Agent
by that time the Company will not be penalized for a payment received after
2:00 p.m. (New York time). The Administrative Agent will promptly
distribute to each Bank its ratable share of each such payment received by
the Administrative Agent for the account of the Banks. Whenever any payment
of principal of, or interest on, the Domestic Loans, the Money Market Rate
Loans or of the Facility Fee or any other amounts payable to the Banks
hereunder shall be due on a day which is not a Domestic Business Day, the
date for payment thereof shall be extended to the next succeeding Domestic
Business Day. Whenever any payment of principal of, or interest on, the
Eurodollar Loans or the Money Market Eurodollar Loans shall be due on a day
which is not a Eurodollar Business Day, the date for payment thereof shall
be extended to the next succeeding Eurodollar Business Day unless such
Eurodollar Business Day falls in another calendar month, in which case the
date for payment thereof shall be the next preceding Eurodollar Business
Day. If the date for any payment of principal is extended by operation of
law or otherwise, interest thereon shall be payable for such extended time.
(b) Unless the Administrative Agent shall have received notice
from the Company prior to the date on which any payment is due to the Banks
hereunder that the Company will not make such payment in full, the
Administrative Agent may assume that the Company has made such payment in
full to the Administrative Agent on such date and the Administrative Agent
may, in reliance upon such assumption, cause to be distributed to each Bank
on such due date an amount equal to the amount then due such Bank. If and
to the extent that the Company shall not have so made such payment, each
Bank shall repay to the Administrative Agent forthwith on demand such
amount distributed to such Bank together with interest thereon, for each
day from the date such amount is distributed to such Bank until the date
such Bank repays such amount to the Administrative Agent, at the Federal
Funds Rate.
SECTION 2.11. Fees. Commencing with the earlier of (x) the
Closing Date and (y) April 15, 1996, the Company agrees to pay to the Banks
a facility fee (the "Facility Fee") on the daily average of the Total
Commitments at a rate per annum determined by reference to the senior
unsecured long-term debt ratings of the Company, or the senior unsecured
long-term debt ratings of the Company (as guaranteed by the Guarantor),
whichever is higher, by S&P and Moody's, as specified on Schedule I hereto.
Any change in the Facility Fee shall become effective on the day on which
such a Rating Agency publicly announces a change in such rating. The
Facility Fee shall (i) be computed on the basis of a year of 365 or 366
days for the actual number of days elapsed, (ii) be payable in arrears on
each Quarterly Date during the period from and including the earlier of (x)
the Closing Date and (y) April 15, 1996 to but excluding the Commitment
Termination Date and on the Commitment Termination Date, and (iii) be paid
by the Company to the Administrative Agent for the account of the Banks.
Notwithstanding the foregoing, Facility Fees in respect of the Commitment
of any Bank shall cease to accrue, and accrued but unpaid Facility Fees
shall be payable, on the date (if any) on which such Bank's Commitment
is terminated pursuant hereto.
SECTION 2.12. Reduction or Termination of Commitments.
The Company shall have the right at any time or from time to
time, upon not less than three Domestic Business Days' prior written notice
to the Administrative Agent, to terminate the Commitments of the Banks, in
whole or in part, provided that each partial termination shall be in an
aggregate amount of not less than $25,000,000 and a multiple of $5,000,000,
and shall reduce the respective Commitments of all the Banks
proportionately (the signature pages hereto shall be deemed to be amended
to reflect the reduction in such Commitment). If after giving effect to
such reduction, the aggregate principal amount of the outstanding Loans
exceeds the Commitments as then reduced, the Company shall on such date
ratably prepay the Committed Loans to the extent of such excess, all in
accordance with Section 2.07. The Administrative Agent shall give prompt
written notice to each Bank of each such reduction or termination. The
Commitment of a Bank may also be terminated under the provisions of Section
10.01(a).
SECTION 2.13. Lending Offices. Each Loan shall be made and
maintained by the Applicable Lending Office of each respective Bank.
Subject to the provisions of Sections 8.01, 8.03 and 10.08(d), each Bank
may transfer any Loan to or designate a different office of itself or any
subsidiary or affiliate and such office shall thereupon become an
Applicable Lending Office.
SECTION 2.14. Reimbursement. The Company shall reimburse each
Bank for all reasonable out-of-pocket costs and expenses, including the
cost of any liquidation and redeployment of funds borrowed by such Bank
(but excluding loss of margin for the period after any payment, conversion
or failure to borrow, convert or continue as described herein), in the
event that the Company makes any payment of principal with respect to, or
converts, any Fixed Rate Loan on any day other than the last day of an
Interest Period applicable thereto (pursuant to Section 2.09 or otherwise)
or any borrowing, conversion, continuation or prepayment notified to the
Banks pursuant to Section 2.02, 2.03, 2.05 or 2.09(b) relative to Fixed
Rate Loans shall not be consummated because of the Company's failure to
satisfy one or more of the applicable conditions precedent in Article III
or because the Company fails to borrow, convert, continue or prepay at the
specified time. Any Bank requesting reimbursement from the Company for such
costs and expenses pursuant to this Section 2.14 shall provide the Company
through the Administrative Agent with the calculation of the amount of such
costs and expenses in reasonable detail.
ARTICLE III
CONDITIONS
SECTION 3.01. Conditions to Closing. The closing hereunder
shall occur on the date that each of the following conditions shall have
been satisfied (or waived in accordance with Section 10.07):
(a) Effectiveness. This Agreement shall have
become effective pursuant to Section 10.12.
(b) Account. The Company shall have designated
in writing to the Administrative Agent its account pursuant
to Section 2.04(b).
(c) Signatures. The Company shall have certified the name and
signature of each officer authorized to sign this Agreement and any Notes
on its behalf and each person authorized to give Notices of Borrowing or
give Notices of Conversion/Continuation under this Agreement; and the
Guarantor shall have certified the name and signature of each officer
authorized to sign this Agreement on its behalf. The Banks may conclusively
rely on such certification until they respectively receive notice in
writing to the contrary.
(d) Opinion of Company Counsel. The Agents shall have received
(i) opinions of Miles & Stockbridge, a Professional Corporation, and
O'Melveny & Myers, special counsel for the Company, substantially in the
forms of Exhibits H-1 and H-2 hereto, and (ii) an opinion of the General
Counsel, the Chief Counsel or an Assistant General Counsel of the Company,
substantially in the form of Exhibit H-3 hereto; the Company hereby
expressly instructs each such counsel to prepare such opinion for the
benefit of the Agents and the Banks.
(e) Opinion of Bank Counsel. The Agents shall
have received an opinion of Davis Polk & Wardwell, special
counsel for the Agents, substantially in the form of
Exhibit I hereto.
(f) Proof of Corporate Action. The Company shall have delivered
copies certified by (i) its Secretary or an Assistant Secretary of its
Charter and Bylaws and of all corporate action taken by the Company to
authorize the execution, delivery and performance of this Agreement and the
Notes and the borrowing hereunder and (ii) the Secretary or an Assistant
Secretary of the Guarantor of its Charter and Bylaws and of all corporate
action taken by the Guarantor to authorize the execution, delivery and
performance of this Agreement.
(g) Termination and Payment under Existing Agreements. The
Documentation Agent shall have received evidence reasonably satisfactory to
it regarding the termination of commitments, and payment of amounts due,
under the Loan Agreement dated as of March 15, 1995 among Lockheed Martin
Corporation, the guarantors listed therein, the banks listed therein,
Morgan Guaranty Trust Company of New York, as documentation agent, and Bank
of America National Trust and Savings Association, as administrative agent,
and the Amended and Restated Revolving Credit Agreement dated as of
November 23, 1994 among Loral Corporation, certain banks, Morgan Guaranty
Trust Company of New York, as documentation agent and co-arranger, Chemical
Bank, as administrative agent and co-arranger, and Bank of America
Illinois, as co-agent.
(h) Tender Offer Closing. It shall be the case that, and the
Company shall so certify that, (i) tendered shares shall have been accepted
for payment pursuant to the Tender Offer in accordance with the terms of
the Tender Offer; (ii) the terms and conditions of the Tender Offer shall
be in substance as disclosed to the Banks in the Information Memorandum,
but shall in all events include terms and conditions to the effect that
upon the consummation of the Tender Offer, Acquisition Company shall own
and control the number of shares of Loral's common stock as shall be
necessary to approve the Merger without the affirmative vote or approval of
any other shareholders; and (iii) conditions to the consummation of the
Tender Offer shall have been satisfied and shall not have been waived,
except for conditions (x) not material to the combined entity or the
prospects and timing of the consummation of the Merger and (y) not relating
to the legality, validity or legal effect of the financing contemplated
hereby.
(i) Approvals; Compliance with Laws. It shall be the case that,
the Company shall so certify that, and the Agents shall have received
evidence satisfactory to them that, all necessary licenses, permits and
governmental and third-party filings, consents and approvals for the
Acquisition, including the Merger, have been made or obtained and remain in
full force and effect, except for (x) those not material to the combined
entity or the prospects and timing of the consummation of the Merger, (y)
those not relating to the legality, validity or legal effect of the
financing contemplated hereby and (z) in the case of the Merger, the
approval of the holders of the requisite percentage of shares of Loral's
common stock and the filing of any applicable articles or certificate of
merger.
(j) Fees. The Banks and the Agents shall have received the
fees, as otherwise agreed to by them and the Company, then or theretofore
payable.
SECTION 3.02. Conditions to All Loans. The obligation of each
Bank to make each Loan to be made by it on or after the Closing Date
(including the initial Loan) is subject to the following conditions
precedent:
(a) Events of Default, etc. No Event of Default shall have
occurred and be continuing; and except as otherwise described by the
Company in a writing to the Documentation Agent and waived by the Required
Banks, the representations of the Company in Article IV (other than
Sections 4.05, 4.11, 4.12 and the last sentence of Section 4.04) shall be
true on and as of the date of such Loan with the same force and effect as
if made on and as of such date. Notwithstanding the foregoing, for purposes
of the representations of the Company in Article IV in respect of Loans to
be made on the Closing Date, the limitation in the parenthetical included
in the previous sentence shall not apply.
(b) Company Representation. Each Notice of Borrowing given by
the Company pursuant to Section 2.02 or Section 2.03(f) shall constitute a
representation by the Company as to the satisfaction in respect of such
borrowing of the conditions referred to in Section 3.02(a).
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
The Company represents and warrants (such representations and
warranties when given on the Closing Date to be given after giving effect
to the consummation of the Tender Offer, provided that to the extent given
on the Closing Date with respect to Loral and its Subsidiaries, such
representations and warranties are given only to the knowledge of each
officer of the Company listed as an executive officer in the Company's
annual report on Form 10-K for the year ended December 31, 1995 and each
member of the Company's treasury and legal departments) that:
SECTION 4.01. Corporate Existence and Power. Each of the
Company and its Restricted Subsidiaries is a corporation duly organized and
validly existing under the laws of the state of its incorporation without
limitation on the duration of its existence, is in good standing therein,
and is duly qualified to transact business in all jurisdictions where such
qualification is necessary, except for such jurisdictions where the failure
to be so qualified or licensed will not be reasonably likely to have a
Material Adverse Effect; each of the Company and the Guarantor has
corporate power to enter into and perform this Agreement; and the Company
has the corporate power to borrow and issue Notes as contemplated by this
Agreement.
SECTION 4.02. No Contravention. The execution and delivery by
the Company and the Guarantor of this Agreement and any Notes and the
Merger Agreement and the performance by the Company and the Guarantor of
their respective obligations under this Agreement and any Notes and the
Merger Agreement, do not contravene, or constitute a default under, any
provision of applicable law or regulation or such corporation's Charter, or
Certificate of Incorporation, as the case may be, or Bylaws or any
indenture, agreement, instrument, judgment or order to which the Company or
the Guarantor is a party or by which it or any of its material assets or
properties may be bound or affected which would be reasonably likely to
have a Material Adverse Effect.
SECTION 4.03. Corporate Authorization; Binding Effect. Each of
the Company and the Guarantor has taken all corporate action necessary to
authorize its execution and delivery of this Agreement and any Notes and
the Merger Agreement and the consummation of the transactions contemplated
hereby; this Agreement and any Notes and the Merger Agreement constitute
the valid and binding agreements of the Company and the Guarantor
enforceable against the Company and the Guarantor in accordance with their
respective terms, except to the extent limited by bankruptcy,
reorganization, insolvency, moratorium and other similar laws of general
application relating to or affecting the enforcement of creditors' rights
or by general equitable principles.
SECTION 4.04. Financial Information. The unaudited pro forma
combined condensed balance sheet of the Company and the Consolidated
Subsidiaries (giving effect to the Merger) dated as of December 31, 1995
and the related unaudited pro forma combined condensed statements of
earnings of the Company and the Consolidated Subsidiaries (giving effect to
the Merger) for the fiscal year ended December 31, 1995 contained in the
Information Memorandum (together with the historical consolidated financial
statements (including management's analysis of financial condition and
operating results) of the Company and Loral contained, in respect of the
Company, in the Company's annual report on Form 10-K for the fiscal year
ended December 31, 1995, and, in respect of Loral, in Loral's annual and
quarterly reports on Forms 10-K and 10-Q for the fiscal year ended March
31, 1995 and fiscal quarterly periods ended December 31, 1995,
respectively, collectively referred to as the "Financial Statements"),
furnished to the Banks prior to the execution of this Agreement, present
the pro forma consolidated financial condition of the Company and the
Consolidated Subsidiaries (giving effect to the Merger) as of December 31,
1995, and the pro forma results of their operations for the fiscal year
ended December 31, 1995, based on preliminary estimates, adjustments and
assumptions, which were believed to be reasonable in the circumstances
under which such unaudited pro forma financial statements were prepared.
Since December 31, 1995, there has occurred no change in the consolidated
financial condition of the Company and the Consolidated Subsidiaries
(giving effect to the Merger) which would be reasonably likely to have a
Material Adverse Effect.
SECTION 4.05. Litigation; Taxes. (a) There are no suits,
actions or proceedings pending, or to the knowledge of any member of the
Company's legal department threatened, against or affecting the Company or
any Subsidiary, the adverse determination of which is reasonably likely to
occur, and if so adversely determined would be reasonably likely to have a
Material Adverse Effect. On the date of the initial borrowing hereunder,
there exists (i) no injunction against consummation of the Tender Offer,
(ii) no litigation pending, or to the knowledge of any member of the
Company's legal department threatened, which gives rise to a material
likelihood that the Merger will not be consummated or will be subject to
undue delay, and (iii) no litigation pending, or to the knowledge of any
member of the Company's legal department threatened, other than that as to
which there is not a material likelihood of success, challenging the
legality, validity or legal effect of the financing contemplated hereby.
(b) The Company and each Subsidiary have filed all material tax
returns which to the knowledge of any member of the Company's tax
department were required to be filed and have paid or have adequately
provided for all taxes shown thereon to be due, including interest and
penalties, except for (i) those not yet delinquent, (ii) those the
nonpayment of which would not be reasonably likely to have a Material
Adverse Effect and (iii) those being contested in good faith.
SECTION 4.06. Margin Regulations. No part of
the proceeds of any Loan will be used in a manner which would
violate, or result in a violation of, Regulation U.
SECTION 4.07. Governmental Approvals. No consent, approval,
authorization, permit or license from, or registration or filing with, any
Governmental Authority is required in connection with the making of this
Agreement, with the exception of routine periodic filings made under the
Exchange Act and the filing of International Capital Form CQ-1's.
SECTION 4.08. Pari Passu Obligations. Under applicable United
States laws (including state and local laws) in force at the date hereof,
the claims and rights of the Banks and the Agents against the Company under
this Agreement and the Notes will not be subordinate to, and will rank at
least pari passu with, the claims and rights of any other unsecured
creditors of the Company (except to the extent provided by bankruptcy,
reorganization, insolvency, moratorium or other similar laws of general
application relating to or affecting the enforcement of creditors' rights
and by general principles of equity).
SECTION 4.09. No Defaults. The payment
obligations of the Company and the Restricted Subsidiaries
in respect of any Material Debt are not overdue.
SECTION 4.10. Full Disclosure. All information furnished to the
Banks in writing prior to the date hereof in connection with the
transactions contemplated hereby (including, without limitation, the
Information Memorandum, but subject to the qualifications and limitations
set forth in the Information Memorandum (including, without limitation, in
the pro forma and forecasted financial information)) does not,
collectively, contain any misstatement of a material fact or omit to state
a fact necessary to make the statements contained therein, in the light of
the circumstances under which they were made, not misleading in any
material respect on and as of the date hereof.
SECTION 4.11. ERISA. Each member of the ERISA Group has
fulfilled its obligations under the minimum funding standards of ERISA and
the Internal Revenue Code with respect to each Plan and is in substantial
compliance in all material respects with the presently applicable material
provisions of ERISA and the Internal Revenue Code with respect to each
Plan. No member of the ERISA Group has (i) sought a waiver of the minimum
funding standard under Section 412 of the Internal Revenue Code in respect
of any Plan, (ii) failed to make any contribution or payment to any Plan or
Multiemployer Plan or made any amendment to any Plan which, in either case
has resulted or could result in the imposition of a material Lien or the
posting of a material bond or other material security under ERISA or the
Internal Revenue Code or (iii) incurred any material liability under Title
IV of ERISA other than a liability to the PBGC for premiums under Section
4007 of ERISA.
SECTION 4.12. Environmental Matters. The Financial Statements
described in Section 4.04 provide certain information regarding the current
and potential obligations arising from various consent decrees, cleanup and
abatement orders, and current or potential proceedings pertaining to actual
or alleged soil and water contamination, disposal of hazardous wastes, and
other environmental matters related to properties currently owned by the
Company or its Restricted Subsidiaries, previously owned properties, and
other properties. Since December 31, 1995, environmental matters have not
caused any material adverse change in the consolidated financial condition
of the Company and the Consolidated Subsidiaries from that shown by such
Financial Statements.
In the ordinary course of business, the ongoing operations of
the Company and its Restricted Subsidiaries are reviewed from time to time
to determine compliance with applicable Environmental Laws. Based on these
reviews, to the knowledge of the Company, ongoing operations at the
Principal Properties are currently being conducted in substantial
compliance with applicable Environmental Laws except to the extent that
noncompliance would not be reasonably likely to result in a material
adverse change in the consolidated financial condition of the Company and
the Consolidated Subsidiaries.
ARTICLE V
COVENANTS
From the Closing Date and so long as any Commitments of the
Banks shall be outstanding and until the payment in full of all Loans
outstanding under this Agreement and the performance of all other
obligations of the Company under this Agreement, the Company agrees that,
unless the Required Banks shall otherwise consent in writing:
SECTION 5.01. Information. The Company will
deliver to the Administrative Agent for each of the Banks:
(a) as soon as available and in any event within 60 days after
the end of each of its first three quarterly accounting periods in each
fiscal year, consolidated statements of earnings and cash flows of the
Company and the Consolidated Subsidiaries for the period from the beginning
of such fiscal year to the end of such fiscal period and the related
consolidated balance sheet of the Company and the Consolidated Subsidiaries
as at the end of such fiscal period, all in reasonable detail (it being
understood that delivery of such statements as filed with the Securities
and Exchange Commission shall be deemed to satisfy the requirements of this
subsection) and accompanied by a certificate in the form attached hereto as
Exhibit J signed by a financial officer of the Company stating that such
consolidated financial statements fairly present the consolidated financial
condition and results of operations of the Company and the Consolidated
Subsidiaries as of the end of such period and for the period involved,
subject, however, to year-end audit adjustments, and that such officer has
no knowledge, except as specifically stated, of any Default;
(b) as soon as available and in any event within 120 days after
the end of each fiscal year, consolidated statements of earnings and cash
flows of the Company and the Consolidated Subsidiaries for such year and
the related consolidated balance sheets of the Company and the Consolidated
Subsidiaries as at the end of such year, all in reasonable detail and
accompanied by (i) an opinion of independent public accountants of
recognized standing selected by the Company as to such consolidated
financial statements (it being understood that delivery of such statements
as filed with the Securities and Exchange Commission shall be deemed to
satisfy the requirements of this subsection), and (ii) a certificate in the
form attached hereto as Exhibit J signed by a financial officer of the
Company stating that such consolidated financial statements fairly present
the consolidated financial condition and results of operations of the
Company and the Consolidated Subsidiaries as of the end of such year and
for the year involved and that such officer has no knowledge, except as
specifically stated, of any Default;
(c) promptly after their becoming available:
(i) copies of all financial statements, stockholder reports and
proxy statements that the Company shall have sent to its stockholders
generally; and
(ii) copies of all registration statements filed by the Company
under the Securities Act of 1933, as amended (other than registration
statements on Form S-8 or any registration statement filed in
connection with a dividend reinvestment plan), and regular and
periodic reports, if any, which the Company shall have filed with the
Securities and Exchange Commission (or any governmental agency or
agencies substituted therefor) under Section 13 or Section 15(d) of
the Exchange Act, or with any national or international securities
exchange (other than those on Form 11-K or any successor form);
(d) from time to time, with reasonable promptness, but subject
to restrictions imposed by applicable security clearance regulations, such
further information regarding the business and financial condition of the
Company and its Subsidiaries as any Bank may reasonably request through the
Documentation Agent;
(e) prompt notice of the occurrence of any Default; and
(f) prompt notice of all litigation and of all proceedings
before any governmental or regulatory agency pending (or, to the knowledge
of the General Counsel of the Company, threatened) and affecting the
Company or any Restricted Subsidiary, except litigation or proceedings
which, if adversely determined, would not be reasonably likely to result in
a Material Adverse Effect.
Each set of financial statements delivered pursuant to clause
(a) or clause (b) of this Section 5.01 shall be accompanied by or include
the computations showing, in the form attached hereto as Exhibit J, whether
the Company was, at the end of the relevant fiscal period, in compliance
with the provisions of Section 5.09.
SECTION 5.02. Payment of Obligations. The Company will pay and
discharge, and will cause each Restricted Subsidiary to pay and discharge,
all material taxes, assessments and governmental charges or levies imposed
upon it or upon its income or profits, or upon any property belonging to
it, prior to the date on which penalties attach thereto, and all lawful
material claims which, if unpaid, might become a Lien upon the property of
the Company or such Restricted Subsidiary; provided that neither the
Company nor any such Restricted Subsidiary shall be required to pay any
such tax, assessment, charge, levy or claim (i) the payment of which is
being contested in good faith and by proper proceedings, (ii) not yet
delinquent or (iii) the non-payment of which, if taken in the aggregate,
would not be reasonably likely to result in a Material Adverse Effect.
SECTION 5.03. Insurance. The Company will maintain, and will
cause each Restricted Subsidiary to maintain, insurance from responsible
companies in such amounts and against such risks as is customarily carried
by owners of similar businesses and properties in the same general areas in
which the Company or such Restricted Subsidiary operates or, to the
customary extent, self-insurance.
SECTION 5.04. Maintenance of Existence. The Company will
preserve and maintain, and will cause each Restricted Subsidiary to
preserve and maintain, its corporate existence and all of its rights,
privileges and franchises necessary or desirable in the normal conduct of
its business, and conduct its business in an orderly, efficient and regular
manner. Nothing herein contained shall prevent the termination of the
business or corporate existence of any Subsidiary (other than the
Guarantor) which in the judgment of the Company is no longer necessary or
desirable, a merger or consolidation of a Subsidiary into or with the
Company (if the Company is the surviving corporation) or another Subsidiary
or any merger, consolidation or transfer of assets permitted by Section
5.07, as long as immediately after giving effect to any such transaction,
no Default shall have occurred and be continuing.
SECTION 5.05. Maintenance of Properties. The Company will keep,
and will cause each Restricted Subsidiary to keep, all of its properties
necessary, in the judgment of the Company, in its business in good working
order and condition, ordinary wear and tear excepted. Nothing in this
Section 5.05 shall prevent the Company or any Restricted Subsidiary from
discontinuing the operation or maintenance, or both the operation and
maintenance, of any properties of the Company or any such Restricted
Subsidiary if such discontinuance is, in the judgment of the Company (or
such Restricted Subsidiary), desirable in the conduct of its business.
SECTION 5.06. Compliance With Laws. The Company will comply,
and will cause each Restricted Subsidiary to comply, with the requirements
of all applicable laws, rules, regulations, and orders of any Governmental
Authority, a breach of which would be reasonably expected to have a
Material Adverse Effect, except where contested in good faith and by proper
proceedings.
SECTION 5.07. Mergers, Consolidations and Sales
of Assets.
(a) Neither the Company nor the Guarantor shall consolidate
with or merge into any other Person or convey or transfer its properties
and assets substantially as an entirety to any Person, unless:
(1) the Company or a Consolidated Subsidiary that is
incorporated under the laws of the United States, any state thereof
or the District of Columbia is the surviving corporation of any such
consolidation or merger or is the Person that acquires by conveyance
or transfer the properties and assets of the Company or the Guarantor
substantially as an entirety;
(2) if a Consolidated Subsidiary is the surviving
corporation or is the Person that acquires the property and assets of
the Company or the Guarantor substantially as an entirety, it shall
expressly assume the performance of every covenant of this Agreement
and of the Notes on the part of the Company or the Guarantor, as the
case may be, to be performed or observed;
(3) immediately after giving effect to such transaction,
no Default shall have occurred and be continuing; and
(4) if the Company or the Guarantor, as the case may be,
is not the surviving corporation, the Company has delivered to the
Documentation Agent an Officer's Certificate and a legal opinion of
its General Counsel, Chief Counsel or Assistant General Counsel, upon
the express instruction of the Company for the benefit of the
Documentation Agent and the Banks, each stating that such transaction
complies with this Section and that all conditions precedent herein
provided for relating to such transaction have been complied with.
(b) Upon any consolidation by the Company or the Guarantor
with, or merger by the Company or the Guarantor into, a Consolidated
Subsidiary or any conveyance or transfer of the properties and assets of
the Company or the Guarantor substantially as an entirety to a Consolidated
Subsidiary, the Consolidated Subsidiary into which the Company or the
Guarantor is merged or consolidated or to which such conveyance or transfer
is made shall succeed to, and be substituted for, and may exercise every
right and power of, the Company or the Guarantor, as the case may be, under
this Agreement with the same effect as if such Consolidated Subsidiary had
been named as the Company or the Guarantor, as the case may be, herein, and
thereafter, in the case of a transfer or conveyance permitted by Section
5.07(a), the Company or the Guarantor, as the case may be, shall be
relieved of all obligations and covenants under this Agreement and the
Notes.
This covenant shall not, so long as the common stock of Loral
is "margin stock" within the meaning of Regulation U, apply to any sale of
such stock for value.
SECTION 5.08. Limitation on Liens. The Company will not, and
will not permit any Restricted Subsidiary to, create or suffer to exist any
Lien upon any of its assets, now owned or hereafter acquired, securing any
Debt; provided, however, that the foregoing restrictions shall not apply
to:
(a) Liens on any assets owned by the Company or
any Restricted Subsidiary existing at the date of this Agreement;
(b) Liens on assets of a corporation or other entity existing
at the time such corporation or other entity is merged into or consolidated
with the Company or a Restricted Subsidiary (to the extent applicable, in
accordance with Section 5.07), or at the time of a purchase, lease or other
acquisition of the assets of a corporation or other entity as an entirety
or substantially as an entirety by the Company or a Restricted Subsidiary,
whether or not any indebtedness secured by such Liens is assumed by the
Company or such Restricted Subsidiary;
(c) Liens on assets of a corporation or other entity existing
at the time such corporation or other entity becomes a Restricted
Subsidiary;
(d) Liens securing Debt of a Restricted Subsidiary owing
to the Company or to another Restricted Subsidiary;
(e) materialmen's, suppliers', tax or other similar Liens
arising in the ordinary course of business securing obligations which are
not overdue or are being contested in good faith by appropriate
proceedings; and Liens arising by operation of law in favor of any lender
to the Company or any Restricted Subsidiary in the ordinary course of
business constituting a banker's lien or right of offset in moneys of the
Company or a Restricted Subsidiary deposited with such lender in the
ordinary course of business;
(f) Liens on assets existing at the time of acquisition of such
assets by the Company or a Restricted Subsidiary, or Liens to secure the
payment of all or any part of the purchase price of assets upon the
acquisition of such assets by the Company or a Restricted Subsidiary or to
secure any Debt incurred or guaranteed by the Company or a Restricted
Subsidiary prior to, at the time of, or within one year after the later of
the acquisition, completion of construction (including any improvements on
an existing asset) or commencement of full operation of such asset, which
Debt is incurred or guaranteed for the purpose of financing all or any part
of the purchase price thereof or construction or improvements thereon, and
which Debt may be in the form of obligations incurred in connection with
industrial revenue bonds or similar financings and letters of credit issued
in connection therewith; provided, however, that in the case of any such
acquisition, construction or improvement the Lien shall not apply to any
asset theretofore owned by the Company or a Restricted Subsidiary, other
than, in the case of any such construction or improvement, any theretofore
unimproved real property on which the property so constructed or the
improvement made is located;
(g) Liens in favor of any customer (including any Governmental
Authority) to secure partial, progress, advance or other payments or
performance pursuant to any contract or statute or to secure any related
indebtedness or to secure Debt guaranteed by a Governmental Authority;
(h) Liens on cash or certificates of deposit or other bank
obligations in an amount substantially equal in value (at the time such
Liens are created) to, and securing, indebtedness in an aggregate principal
amount not in excess of $200,000,000 (or the equivalent amount in a
different currency);
(i) Liens equally and ratably securing the Loans and such Debt;
provided that the Required Banks may, in their sole discretion, refuse to
take any Lien on any asset (which refusal will not limit the Company's or
any Restricted Subsidiary's ability to incur a Lien otherwise permitted by
this Section 5.08(i)); such Lien may equally and ratably secure the Loans
and any other obligation of the Company or any of its Subsidiaries, other
than an obligation that is subordinated to the Loans;
(j) any extension, renewal or replacement (or successive
extensions, renewals or replacements) in whole or in part of any Lien
referred to in the foregoing; provided, however, that the principal amount
of Debt secured thereby shall not exceed the principal amount of Debt so
secured at the time of such extension, renewal or replacement, and that
such extension, renewal or replacement shall be limited to all or part of
the asset which secured the Lien so extended, renewed or replaced (plus
improvements and construction on such asset); and
(k) Liens securing Debt in an aggregate amount that, together
with all other Debt of the Company and its Restricted Subsidiaries that is
secured by Liens not otherwise permitted under subsections (a) through (j)
above (if originally issued, assumed or guaranteed at such time), does not
at the time exceed the greater of 10% of Stockholders' Equity as of the end
of the fiscal quarter preceding the date of determination or
$1,000,000,000. For purpose of this Section 5.08(k), the term "Consolidated
Subsidiaries" in the definition of Stockholders' Equity includes any Exempt
Subsidiaries.
The exceptions to the Lien limitations described in clauses
(b), (c) and (f) above shall not apply to Liens on any stock or assets of
Loral or any of its subsidiaries incurred in contemplation of the
Acquisition.
This covenant shall not apply to any "margin stock" within the
meaning of Regulation U in excess of 25% in value of the assets covered by
this covenant.
For the avoidance of doubt, the creation of a security interest
arising solely as a result of, or the filing of UCC financing statements in
connection with, any sale by the Company or any of its Subsidiaries of
accounts receivable not prohibited by Section 5.07 shall not constitute a
Lien prohibited by this covenant.
SECTION 5.09. Leverage Ratio. The Company will not permit, as
of the last day of any fiscal quarter, the ratio of (a) Debt to (b) the sum
of Debt and Stockholders' Equity, to exceed: (i) for quarters ending on or
before December 30, 1996, 72.5%; (ii) for quarters ending on or after
December 31, 1996 and on or before December 30, 1997, 67.5%; (iii) for
quarters ending on or after December 31, 1997 and on or before September
29, 1998, 62.5%; (iv) for quarters ending on or after September 30, 1998,
60.0%. For purposes of this Section 5.09, the term "Consolidated
Subsidiaries" in the definitions of Debt and Stockholders' Equity includes
any Exempt Subsidiaries.
SECTION 5.10. Use of Loans. The Company will use the proceeds
of the Loans to finance the Acquisition and for any other lawful corporate
purposes of the Company.
ARTICLE VI
DEFAULTS
SECTION 6.01. Events of Default. If one or more of the
following events ("Events of Default") shall have occurred and be
continuing:
(a) the Company shall fail to pay the principal
of any Loan when due;
(b) the Company shall fail to pay within 5 days
of the due date thereof (i) any Facility Fee or (ii) interest on any Loan;
(c) the Company shall fail to pay within 30 days after written
request for payment by any Bank acting through the Administrative Agent any
other amount payable under this Agreement;
(d) the Company shall fail to observe or perform
any agreement contained in Sections 5.07 through 5.09;
(e) the Company shall fail to observe or perform any covenant
or agreement contained in this Agreement (other than those covered by
clauses (a) through (d) above) for 30 days after written notice thereof has
been given to the Company by the Documentation Agent at the request of the
Required Banks;
(f) any representation or warranty made by the Company in
Article IV of this Agreement or any certificate or writing furnished
pursuant to this Agreement shall prove to have been incorrect in any
material respect when made and such deficiency shall remain unremedied for
5 days after written notice thereof shall have been given to the Company by
the Documentation Agent at the request of the Required Banks;
(g) any Material Debt shall become due before stated maturity
by the acceleration of the maturity thereof by reason of default, or any
Material Debt shall become due by its terms and shall not be paid and, in
any case aforesaid in this clause (g), corrective action satisfactory to
the Required Banks shall not have been taken within 5 days after written
notice of the situation shall have been given to the Company by the
Documentation Agent at the request of the Required Banks;
(h) the Company or any Restricted Subsidiary shall commence a
voluntary case or other proceeding seeking liquidation, reorganization or
other relief with respect to itself or its debts under any bankruptcy,
insolvency or other similar law now or hereafter in effect or seeking the
appointment of a trustee, receiver, liquidator, custodian or other similar
official of it or any substantial part of its property, or shall consent to
any such relief or to the appointment of or taking possession by any such
official in an involuntary case or other proceeding commenced against it,
or shall make a general assignment for the benefit of creditors, or shall
fail generally to pay its debts as they become due, or shall take any
corporate action to authorize any of the foregoing;
(i) an involuntary case or other proceeding shall be commenced
against the Company or any Restricted Subsidiary seeking liquidation,
reorganization or other relief with respect to it or its debts under any
bankruptcy, insolvency or other similar law now or hereafter in effect or
seeking the appointment of a trustee, receiver, liquidator, custodian or
other similar official of it or any substantial part of its property, and
such involuntary case or other proceeding shall remain undismissed and
unstayed for a period of 90 days; or an order for relief shall be entered
against the Company or any Restricted Subsidiary under the federal
bankruptcy laws as now or hereafter in effect;
(j) a final judgment for the payment of money in excess of
$150,000,000 shall have been entered against the Company or any Restricted
Subsidiary, and the Company or such Restricted Subsidiary shall not have
satisfied the same within 60 days, or caused execution thereon to be stayed
within 60 days, and such failure to satisfy or stay such judgment shall
remain unremedied for 5 days after notice thereof shall have been given to
the Company by the Documentation Agent at the request of the Required
Banks;
(k) a final judgment either (1) requiring termination or
imposing liability (other than for premiums under Section 4007 of ERISA)
under Title IV of ERISA in respect of, or requiring a trustee to be
appointed under Title IV of ERISA to administer, any Plan or Plans having
aggregate Unfunded Liabilities in excess of $150,000,000 or (2) in an
action relating to a Multiemployer Plan involving a current payment
obligation in excess of $150,000,000, which judgment, in either case, has
not been satisfied or stayed within 60 days and such failure to satisfy or
stay is unremedied for 5 days after notice thereof shall have been given to
the Company by the Documentation Agent at the request of the Required
Banks;
(l) during any two-year period, individuals who at the
beginning of such period constituted the Company's Board of Directors (or,
if such two-year period commences on or before February 6, 1995, the
directors of the Company specified in the Joint Proxy Statement/Prospectus
dated February 9, 1995, of Lockheed Corporation, Martin Marietta
Corporation and the Company) (together with any new director whose election
by the Board of Directors or whose nomination for election by the
stockholders of the Company was approved by a vote of at least two-thirds
of the directors then in office who either were directors at the beginning
of such period or whose election or nomination for election was previously
so approved) cease for any reason to constitute a majority of the directors
then in office;
(m) any person or group of persons (within the meaning of
Section 13 or 14 of the Exchange Act) (other than an employee benefit or
stock ownership plan of the Company or any of its Subsidiaries) shall have
acquired, directly or indirectly, shares of capital stock (whether common
or preferred or a combination thereof) having ordinary voting power to
elect a majority of the members of the Board of Directors of the Company;
or
(n) the guarantee set forth in Section 9.01, for any reason
other than payment in full of all amounts due hereunder following
termination of all Commitments or a transaction permitted by Section 5.07
in which the Guarantor and the Company merge and either is the surviving
entity, ceases to be in full force and effect (including with respect to
future Loans), is revoked or is declared null and void, or the Guarantor
denies that it has or contests any further liability under Article IX, or
gives notice to such effect;
then, and in every such event, the Documentation Agent shall, if requested
by the Required Banks, (i) by notice to the Company terminate the
Commitments and they shall thereupon terminate, and (ii) by notice to the
Company declare the Loans, interest accrued thereon and all other amounts
payable hereunder to be, and the same shall thereupon become, immediately
due and payable without presentment, demand, protest or other notice of any
kind, all of which are hereby waived by the Company; provided that in the
event of (A) the filing by the Company of a petition, or (B) an actual or
deemed entry of an order for relief with respect to the Company, under the
federal bankruptcy laws as now or hereafter in effect, without any notice
to the Company or any other act by the Documentation Agent or the Banks,
the Total Commitments shall thereupon terminate and the Loans, interest
accrued thereon and all other amounts payable hereunder shall become
immediately due and payable without presentment, demand, protest or other
notice of any kind, all of which are hereby waived by the Company.
ARTICLE VII
THE AGENTS
SECTION 7.01. Appointment and Authorization. Each Bank appoints
and authorizes each Agent to take such action as agent on its behalf and to
exercise such powers under this Agreement and the Notes as are delegated to
such Agent by the terms hereof or thereof, together with all such powers as
are reasonably incidental thereto; provided, however, that the Agents shall
not commence any legal action or proceeding before a court of law on behalf
of any Bank without such Bank's prior consent.
SECTION 7.02. Agents and Affiliates. Each of Bank of America
National Trust and Savings Association and Morgan Guaranty Trust Company of
New York and their respective affiliates may accept deposits from, lend
money to, and generally engage in any kind of business with the Company or
any Subsidiary or affiliate of the Company as if it were not an Agent
hereunder. With respect to its Commitment and Loans made by it, each of
Bank of America National Trust and Savings Association and Morgan Guaranty
Trust Company of New York (and any of their respective successors acting as
an Agent), in its capacity as a Bank hereunder, shall have the same rights
and obligations hereunder as any other Bank and may exercise (or be subject
to) the same as though it were not an Agent. The term "Bank" or "Banks"
shall, unless otherwise expressly indicated, include each of Bank of
America National Trust and Savings Association and Morgan Guaranty Trust
Company of New York (and any successor acting as an Agent) in its capacity
as a Bank.
SECTION 7.03. Action by Agents. The obligations of the Agents
hereunder are only those expressly set forth herein. Without limiting the
generality of the foregoing, the Agents shall not be required to take any
action with respect to any Default, except as expressly provided in Article
VI.
SECTION 7.04. Consultation with Experts. Each Agent may consult
with legal counsel (who may be counsel for the Company), independent public
accountants and other experts selected by it and shall not be liable to any
Bank for any action taken or omitted to be taken by it in good faith in
accordance with the advice of such counsel, accountants or experts.
SECTION 7.05. Liability of Agents. No Agent nor any of its
directors, officers, agents, or employees shall be liable for any action
taken or not taken by it in connection herewith (i) with the consent or at
the request of the Required Banks or (ii) in the absence of its own gross
negligence or willful misconduct. No Agent nor any of its directors,
officers, agents or employees shall be responsible for or have any duty to
ascertain, inquire into or verify (i) any statement, warranty or
representation made by any Person in connection with this Agreement or any
borrowing hereunder; (ii) the performance or observance of any of the
covenants or agreements of the Company; (iii) the satisfaction of any
condition specified in Article III, except receipt of items required to be
delivered to such Agent; or (iv) the validity, effectiveness (except for
its own due execution and delivery) or genuineness of this Agreement, the
Notes or any other instrument or writing furnished in connection herewith.
No Agent shall incur any liability by acting in reasonable reliance upon
any notice, consent, certificate, statement, or other writing (which may be
a bank wire, facsimile transmission or similar writing) believed by it to
be genuine or to be signed by the proper party or parties.
SECTION 7.06. Indemnification. Each Bank shall, ratably in
accordance with its Commitment, indemnify each Agent (to the extent not
reimbursed by the Company) against any cost, expense (including counsel
fees and disbursements), claim, demand, action, loss or liability (except
such as result from such Agent's gross negligence or willful misconduct)
that such Agent may suffer or incur in connection with this Agreement or
any action taken or omitted by such Agent hereunder.
SECTION 7.07. Credit Decision. Each Bank acknowledges that it
has, independently and without reliance upon either Agent or any other
Bank, and based on such documents and information as it has deemed
appropriate, made its own credit analysis and decision to enter into this
Agreement. Each Bank also acknowledges that it will, independently and
without reliance upon either Agent or any other Bank, and based on such
documents and information as it shall deem appropriate at the time,
continue to make its own credit decisions in taking or not taking any
action under this Agreement.
SECTION 7.08. Successor Agents. An Agent may resign at any time
by giving written notice thereof to the Banks and the Company. Upon any
such resignation, the Company shall, with the consent of the Required
Banks, have the right to appoint a successor Agent (which may be the other
institution then acting as Agent). If no successor Agent shall have been so
appointed, and shall have accepted such appointment, within 60 days after
the retiring Agent gives notice of resignation, the retiring Agent may, on
behalf of the Banks, appoint a successor Agent (which may be the other
institution then acting as Agent), which shall be a commercial bank
organized or licensed under the laws of the United States of America or of
any State thereof and having a combined capital and surplus of at least
$50,000,000. Upon the acceptance of its appointment as an Agent hereunder
by a successor Agent, such successor Agent shall thereupon succeed to and
become vested with all the rights and duties of the retiring Agent, and the
retiring Agent shall be discharged from its duties and obligations
hereunder as Agent. After any retiring Agent's resignation hereunder as an
Agent, the provisions of this Article shall inure to its benefit as to any
actions taken or omitted to be taken by it while it was an Agent.
SECTION 7.09. Agents' Fees. The Company shall
pay to each Agent for its own account fees in the amounts
and at the times previously agreed upon between the Company
and each Agent.
ARTICLE VIII
CHANGE IN CIRCUMSTANCES
SECTION 8.01. Increased Cost and Reduced Return; Capital
Adequacy. (a) If after the date hereof, in the case of any Committed Loan,
or the date of the related Money Market Quote, in the case of any Money
Market Loan, a Change in Law shall impose, modify or deem applicable any
reserve, special deposit, assessment or similar requirement (including,
without limitation, any such requirement imposed by the Board of Governors
of the Federal Reserve System pursuant to Regulation D or otherwise but
excluding any such requirements taken into account in its calculation of
the Adjusted CD Rate, as herein provided) against assets of, deposits with
or for the account of, or credit extended by, any Bank or shall impose on
any Bank or the London interbank market any other condition affecting such
Bank's Fixed Rate Loans, or its Notes; and the result of any of the
foregoing is to increase the cost to such Bank of making or maintaining any
such Fixed Rate Loans, or to reduce the amount of any sum received or
receivable by such Bank under this Agreement or under its Note, by an
amount deemed by such Bank to be material, then, within 15 days after
written demand therefor made through the Administrative Agent, in the form
of the certificate referred to in Section 8.01(c), the Company shall pay to
such Bank such additional amount or amounts as will compensate such Bank
for such increased cost or reduction; provided that the Company shall not
be required to pay any such compensation with respect to any period prior
to the 30th day before the date of any such demand.
(b) Without limiting the effect of Section 8.01(a) (but without
duplication), if any Bank determines at any time after the date on which
this Agreement becomes effective that a Change in Law will have the effect
of increasing the amount of capital required to be maintained by such Bank
(or its Parent) based on the existence of such Bank's Loans, Commitment
and/or other obligations hereunder, then the Company shall pay to such
Bank, within 15 days after its written demand therefor made through the
Administrative Agent in the form of the certificate referred to in Section
8.01(c), such additional amounts as shall be required to compensate such
Bank for any reduction in the rate of return on capital of such Bank (or
its Parent) as a result of such increased capital requirement; provided
that the Company shall not be required to pay any such compensation with
respect to any period prior to the 30th day before the date of any such
demand; provided further, however, that to the extent (i) a Bank shall
increase its level of capital above the level maintained by such Bank on
the date of this Agreement and there has not been a Change in Law or (ii)
there has been a Change in Law and a Bank shall increase its level of
capital by an amount greater than the increase attributable (taking into
consideration the same variables taken into consideration in determining
the level of capital maintained by such Bank on the date of this Agreement)
to such Change in Law, the Company shall not be required to pay any amount
or amounts under this Agreement with respect to any such increase in
capital. Thus, for example, a Bank which is "adequately capitalized" (as
such term or any similar term is used by any applicable bank regulatory
agency having authority with respect to such Bank) may not require the
Company to make payments in respect of increases in such Bank's level of
capital made under the circumstances described in clause (i) or (ii) above
which improve its capital position from "adequately capitalized" to "well
capitalized" (as such term or any similar term is used by any applicable
bank regulatory agency having authority with respect to such Bank).
(c) Each Bank will promptly notify the Company, through the
Administrative Agent, of any event of which it has knowledge, occurring
after the date on which this Agreement becomes effective, which will
entitle such Bank to compensation pursuant to this Section 8.01 and will
designate a different Applicable Lending Office if such designation will
avoid the need for, or reduce the amount of, such compensation and will
not, in the sole judgment of such Bank, be otherwise disadvantageous to
such Bank. A certificate of any Bank claiming compensation under this
Section 8.01 and setting forth the additional amount or amounts to be paid
to it hereunder and setting forth the basis for the determination thereof
shall be conclusive in the absence of manifest error. In determining such
amount, such Bank shall act reasonably and in good faith, and may use any
reasonable averaging and attribution methods.
SECTION 8.02. Substitute Rate. Anything herein to the contrary
notwithstanding, if within two Domestic Business Days, in the case of CD
Loans, or two Eurodollar Business Days, in the case of Eurodollar Loans or
Money Market Eurodollar Loans, prior to the first day of an Interest Period
none of the Reference Banks is, for any reason whatsoever, being offered
Dollars for deposit in the relevant market for a period and amount relevant
to the computation of the rate of interest on a Fixed Rate Loan for such
Interest Period, the Administrative Agent shall give the Company and each
Bank prompt notice thereof and on what would otherwise be the first day of
such Interest Period such Loans shall be made as Base Rate Loans.
SECTION 8.03. Illegality. (a) Notwithstanding any other
provision herein, if, after the date on which this Agreement becomes
effective, a Change in Law shall make it unlawful or impossible for any
Bank to (i) honor any Commitment it may have hereunder to make any
Eurodollar Loan, then such Commitment shall be suspended, or (ii) maintain
any Eurodollar Loan or any Money Market Eurodollar Loan, then all
Eurodollar Loans and Money Market Eurodollar Loans of such Bank then
outstanding shall be converted into Base Rate Loans as provided in Section
8.03(b), and any remaining Commitment of such Bank hereunder to make
Eurodollar Loans (but not other Loans) shall be immediately suspended, in
either case until such Bank may again make and/or maintain Eurodollar Loans
(as the case may be), and borrowings from such Bank, at a time when
borrowings from the other Banks are to be of Eurodollar Loans, shall be
made, simultaneously with such borrowings from the other Banks, by way of
Base Rate Loans. Upon the occurrence of any such change, such Bank shall
promptly notify the Company thereof (with a copy to the Agents), and shall
furnish to the Company in writing evidence thereof certified by such Bank.
Before giving any notice pursuant to this Section 8.03, such Bank shall
designate a different Applicable Lending Office if such designation will
avoid the need for giving such notice and will not, in the sole reasonable
judgment of such Bank, be otherwise disadvantageous to such Bank.
(b) Any conversion of any outstanding Eurodollar Loan or an
outstanding Money Market Loan which is required under this Section 8.03
shall be effected immediately (or, if permitted by applicable law, on the
last day of the Interest Period therefor).
SECTION 8.04. Taxes on Payments. (a) All payments in respect of
the Loans shall be made free and clear of and without any deduction or
withholding for or on account of any present and future taxes, assessments
or governmental charges imposed by the United States, or any political
subdivision or taxing authority thereof or therein, excluding taxes imposed
on its net income and franchise taxes (all such non-excluded taxes being
hereinafter called "Taxes"), except as expressly provided in this Section
8.04. If any Taxes are imposed and required by law to be deducted or
withheld from any amount payable to any Bank, then the Company shall (i)
increase the amount of such payment so that such Bank will receive a net
amount (after deduction of all Taxes) equal to the amount due hereunder,
(ii) pay such Taxes to the appropriate taxing authority for the account of
such Bank, and (iii) as promptly as possible thereafter, send such Bank
evidence showing payment thereof, together with such additional documentary
evidence as such Bank may from time to time require. If the Company fails
to perform its obligations under (ii) or (iii) above, the Company shall
indemnify such Bank for any incremental taxes, interest or penalties that
may become payable as a result of any such failure; provided, however, that
the Company will not be required to make any payment to any Bank under this
Section 8.04 if withholding is required in respect of such Bank by reason
of such Bank's inability or failure to furnish under subsection (c) an
extension or renewal of a Form 1001 or Form 4224 (or successor form), as
applicable, unless such inability results from an amendment to or a change
in any applicable law or regulation or in the interpretation thereof by any
regulatory authority (including without limitation any change in an
applicable tax treaty), which amendment or change becomes effective after
the date hereof.
(b) The Company shall indemnify the Agents and each Bank
against any transfer taxes, documentary taxes, assessments or charges made
by any Governmental Authority by reason of the execution and delivery of
this Agreement or any Notes (hereinafter referred to as "Other Taxes").
(c) Each Bank that is a foreign person (i.e. a person who is
not a United States person for United States federal income tax purposes)
agrees that it shall deliver to the Company (with a copy to the
Administrative Agent) (i) within twenty Domestic Business Days after the
date on which this Agreement becomes effective, two duly completed copies
of United States Internal Revenue Service Form 1001 or 4224, as
appropriate, indicating that such Bank is entitled to receive payments
under this Agreement without deduction or withholding of any United States
federal income taxes, (ii) from time to time, such extensions or renewals
of such forms (or successor forms) as may reasonably be requested by the
Company but only to the extent such Bank determines that it may properly
effect such extensions or renewals under applicable tax treaties, laws,
regulations and directives and (iii) in the event of a transfer of any Loan
to a subsidiary or affiliate of such Bank, a new Internal Revenue Service
Form 1001 or 4224 (or any successor form), as the case may be, for such
subsidiary or affiliate indicating that such subsidiary or affiliate is, on
the date of delivery thereof, entitled to receive payments under this Agreement
without deduction or withholding of any United States federal income taxes.
The Company and the Administrative Agent shall each be entitled to rely on
such forms in its possession until receipt of any revised or successor form
pursuant to the preceding sentence.
(d) If a Bank, at the time it first becomes a party to this
Agreement (or because of a change in an Applicable Lending Office) is
subject to a United States interest withholding tax rate in excess of zero,
withholding tax at such rate shall be considered excluded from Taxes and
Other Taxes, respectively. For any period with respect to which a Bank has
failed to provide the Company with the appropriate form pursuant to Section
8.04(c) (unless such failure is due to a change in treaty, law or
regulation, or in the interpretation thereof by any regulatory authority,
occurring subsequent to the date on which a form originally was required to
be provided), such Bank shall not be entitled to additional payments under
Section 8.04(a) with respect to Taxes imposed by the United States;
provided, however, that should a Bank, which is otherwise exempt from or
subject to a reduced rate of withholding tax, become subject to Taxes
because of its failure to deliver a form required hereunder, the Company
shall take such steps as such Bank shall reasonably request to assist such
Bank to recover such Taxes.
(e) If the Company is required to pay additional amounts to or
for the account of any Bank pursuant to this Section 8.04, then such Bank
will change the jurisdiction of one or more Applicable Lending Offices so
as to eliminate or reduce any such additional payment which may thereafter
accrue if such change, in the judgment of such Bank, is not otherwise
disadvantageous to such Bank.
(f) If any Bank is able to apply for any credit, deduction or
other reduction in Taxes or Other Taxes in an amount which is reasonably
determined by such Bank to be material, which arises by reason of any
payment made by the Company pursuant to this Section 8.04, such Bank will
use reasonable efforts to obtain such credit, deduction or other reduction
and, upon receipt thereof, will pay to the Company an amount, not exceeding
the amount of such payment by the Company, equal to the net after-tax value
to such Bank, in its good faith determination, of such part of such credit,
deduction or other reduction as it determines to be allocable to such
payment by the Company, having regard to all of its dealings giving rise to
similar credits, deductions or other reductions during the same tax period
and to the cost of obtaining the same; provided, however, that (i) such
Bank shall not be obligated to disclose to the Company any information
regarding its tax affairs or computations and (ii) nothing contained in
this Section 8.04(f) shall be construed so as to interfere with the right
of such Bank to arrange its tax affairs as it deems appropriate.
ARTICLE IX
GUARANTEE
SECTION 9.01. Unconditional Guarantee.
(a) Subject to the provisions of Section 9.03, the Guarantor
hereby fully and unconditionally guarantees the due and punctual payment of
the principal of and interest on the Loans, when and as the same shall
become due and payable, whether at maturity, upon acceleration or
otherwise, and of all other amounts payable by the Company hereunder, in
accordance with the terms of this Agreement. Upon failure by the Company in
the payment of any such amount, the Guarantor agrees to pay the same on
demand by the Documentation Agent at the request of the Required Banks and
in the manner specified in Article II.
(b) The Guarantor's obligations hereunder shall be absolute and
unconditional irrespective of, and shall be unaffected by: (i) any failure
to enforce the provisions of this Agreement; (ii) any extension, renewal,
settlement, compromise, waiver, consent, or indulgence granted to the
Company in respect of any obligation of the Company hereunder or under any
Note, by operation of law or otherwise; (iii) any modification or amendment
of or supplement to this Agreement or any Note, provided that,
notwithstanding the foregoing, no such modification, amendment or
supplement to this Agreement shall, without the consent of the Guarantor,
increase (other than pursuant to the terms of this Agreement) any amount
guaranteed hereunder or modify the terms of this Article IX; (iv) any
change in the corporate existence, structure or ownership of the Company,
or any insolvency, bankruptcy, reorganization or other similar proceeding
affecting the Company or its assets or any resulting release or discharge
of any obligation of the Company contained in this Agreement or any Note;
(v) the existence of any claim, set off or other rights which the Guarantor
may have at any time against the Company, either Agent, any Bank or any
other Person, whether in connection herewith or with any unrelated
transactions; provided that nothing herein shall prevent the assertion of
any such claim by separate suit or compulsory counterclaim; or (vi) any
other circumstance that otherwise might constitute a legal or equitable
discharge of a surety or guarantor.
(c) The Guarantor hereby waives diligence, presentment, filing
of claims with a court in the event of insolvency or bankruptcy of the
Company, any right to require a proceeding first against the Company,
protest, notice and all demands on the Company or the Guarantor whatsoever.
(d) The Guarantor will be subrogated to all rights of the Banks
against the Company in respect of any amount paid by the Guarantor pursuant
to the provisions of the Guarantee contained in this Section 9.01;
provided, however, that the Guarantor shall not be entitled to enforce, or
to receive any payments arising out of or based upon, such right of
subrogation until the principal of and interest on all Loans and any other
amount payable under this Agreement shall have been paid in full.
SECTION 9.02. Discharge; Reinstatement. The obligations of the
Guarantor hereunder shall remain in full force and effect until the
Commitments shall have terminated and the principal of and interest on the
Loans and all the amounts payable by the Company under this Agreement shall
have been paid in full. If at any time any payment of the principal of or
interest on any Loan or any other amount payable by the Company hereunder
is rescinded or must be otherwise restored or returned upon the insolvency,
bankruptcy or reorganization of the Company or otherwise, the obligations
of the Guarantor hereunder with respect to such payment shall be reinstated
as though such payment had been due but not made at such time.
If acceleration of the time for payment of any amount payable
by the Company under this Agreement is stayed upon the insolvency,
bankruptcy or reorganization of the Company, all such amounts otherwise
subject to acceleration under the terms of this Agreement shall none the
less be payable by the Guarantor hereunder forthwith on demand by the
Documentation Agent made at the request of the Required Banks.
SECTION 9.03. Limit of Liability. The obligations of the
Guarantor hereunder shall be limited to an amount equal to the largest
amount that would not render its obligations hereunder subject to avoidance
under Section 548 of the United States Bankruptcy Code or any comparable
provisions of any applicable state law.
ARTICLE X
MISCELLANEOUS
SECTION 10.01. Termination of Commitment of a Bank; New Banks.
(a)(1) If and during the time a Failed Loan shall exist, (2) upon receipt
of notice from any Bank for compensation or indemnification pursuant to
Section 8.01(c) or Section 8.04 or (3) upon receipt of notice that the
Commitment of a Bank to make Eurodollar Loans has been suspended, the
Company shall have the right to terminate the Commitment in full of the
Bank causing such Failed Loan or providing such notice (a "Retiring Bank").
The termination of the Commitment of a Retiring Bank pursuant to this
Section 10.01(a) shall be effective on the tenth Domestic Business Day
following the date of a notice of such termination to the Retiring Bank
through the Documentation Agent, subject to the satisfaction of the
following conditions:
(i) in the event that on such effective date there shall
be any Loans outstanding hereunder, the Company shall have prepaid on
such date the aggregate principal amount of such Loans held by the
Retiring Bank only; and
(ii) in addition to the payment of the principal of the
Loans held by the Retiring Bank pursuant to clause (i) above, the
Company shall have paid such Retiring Bank all accrued interest
thereon, and Facility Fee and any other amounts then payable to it
hereunder, including, without limitation, all amounts payable by the
Company to such Bank under Section 2.14 by reason of the prepayment
of Loans pursuant to clause (i) with respect to the period ending on
such effective date; provided that the provisions of Section 8.01,
Section 8.04 and Section 10.04 shall survive for the benefit of any
Retiring Bank.
Upon satisfaction of the conditions set forth in clauses (i)
and (ii) above, such Bank shall cease to be a Bank hereunder.
(b) In lieu of the termination of a Bank's Commitment pursuant
to Section 10.01(a), the Company may notify the Documentation Agent that
the Company desires to replace such Retiring Bank with a new bank or banks
(which may be one or more of the Banks), which will purchase the Loans and
assume the Commitment of the Retiring Bank. Upon the Company's selection of
a bank to replace a Retiring Bank, such bank's agreement thereto and the
fulfillment of the conditions to assignment and assumption set forth in
Section 10.08(c)(iii), such bank shall become a Bank hereunder for all
purposes in accordance with Section 10.08(c)(iii).
SECTION 10.02. Notices. All notices, requests and other
communications to any party hereunder shall be in writing (including bank
wire, telecopy, facsimile transmission or similar writing) and shall be
given to such party (a) in the case of the Company, the Guarantor or either
Agent, at its address set forth on the signature pages hereof, (b) in the
case of any Bank, at its address set forth in its Administrative
Questionnaire or (c) in the case of any party, such other address as such
party may hereafter specify for the purpose by notice to the Agents and the
Company. Each such notice, request or other communication shall be
effective (i) if given by registered or certified mail, upon the earlier of
the date of actual receipt or the date of delivery indicated on the return
receipt delivered to the sender or (ii) if given by any other means, when
received at the address or telecopier number specified in this Section and
an oral or written confirmation of receipt is received from the recipient.
SECTION 10.03. No Waivers. No failure or delay by either Agent
or any Bank in exercising any right, power or privilege hereunder or under
any Note shall operate as a waiver thereof nor shall any single or partial
exercise thereof preclude any other or further exercise thereof or the
exercise of any other right, power or privilege. The rights and remedies
herein provided shall be cumulative and not exclusive of any rights or
remedies provided by law.
SECTION 10.04. Expenses; Indemnification. (a) The Company shall
pay (i) the reasonable fees and expenses of special counsel for the Agents
in connection with the preparation of this Agreement as previously agreed
upon between the Company and each Agent and (ii) if an Event of Default
occurs, all reasonable out-of-pocket expenses incurred by the Agents and
the Banks, including reasonable fees and expenses of counsel (including
in-house counsel), in connection with such Event of Default and collection
and other enforcement proceedings resulting therefrom.
(b) The Company agrees to indemnify the Agents and each Bank,
their respective affiliates and the respective directors, officers, agents
and employees of the foregoing (each an "Indemnitee") and hold each
Indemnitee harmless from and against any and all liabilities, losses,
damages, costs and reasonable expenses of any kind, including, without
limitation, the reasonable fees and disbursements of counsel, incurred by
such Indemnitee in response to or in defense of any investigative,
administrative or judicial proceeding brought or threatened against either
Agent or any Bank relating to or arising out of this Agreement or any
actual or proposed use of proceeds of Loans hereunder; provided that no
Indemnitee shall have the right to be indemnified hereunder (i) to the
extent such indemnification relates to relationships of, between or
among each of, or any of, the Agents, the Banks or any Assignee or
Participant or (ii) for such Indemnitee's own gross negligence or willful
misconduct.
SECTION 10.05. Pro Rata Treatment. Except as expressly provided
in this Agreement with respect to Money Market Loans or otherwise, (a) each
borrowing from, and change in the Commitments of, the Banks shall be made
pro rata according to their respective Commitments, and (b) each payment
and prepayment on the Loans shall be made to all the Banks, pro rata in
accordance with the unpaid principal amount of the Loans held by each of
them.
SECTION 10.06. Sharing of Set-Offs. Each Bank agrees that if it
shall, by exercising any right of set-off or counterclaim or otherwise
(except as contemplated by Section 2.03, Section 2.14, Article VIII or
Section 10.01), receive payment of a proportion of the aggregate amount of
principal and interest then due with respect to the Loans held by it which
is greater than the proportion received by any other Bank in respect of the
aggregate amount of principal and interest then due with respect to the
Loans held by such other Bank, the Bank receiving such proportionately
greater payment shall purchase such participations in the Loans held by the
other Banks, and such other adjustments shall be made, as may be required
so that all such payments of principal and interest with respect to the
Loans held by the Banks shall be shared by the Banks pro rata; provided
that nothing in this Section shall impair the right of any Bank to exercise
any right of set-off or counterclaim it may have and to apply the amount
subject to such exercise to the payment of indebtedness of the Company,
other than its indebtedness hereunder.
SECTION 10.07. Amendments and Waivers. Any provision of this
Agreement or the Notes may be amended or waived if, but only if, such
amendment or waiver is in writing and is signed by the Company and the
Required Banks (and, if the rights or duties of an Agent are affected
thereby, by the Agent so affected); provided that no such amendment or
waiver shall, unless signed by all the Banks, (i) subject any Bank to any
additional obligation, (ii) reduce the principal of or rate of interest on
any Loan or any fees hereunder, (iii) postpone the date fixed for any
payment of principal of or interest on any Loan or for termination of any
Commitment, (iv) change the percentage of Loans or Total Commitments that
shall be required for the Banks or any of them to take any action under
this Section 10.07 or any other provision of this Agreement or (v) release
the Guarantor from its obligations under, or modify in any material respect
the provisions of, Article IX. Notwithstanding the foregoing, Article IX
may not be amended without the prior consent of the Guarantor.
SECTION 10.08. Successors and Assigns; Participations; Novation.
(a) This Agreement shall be binding upon and inure to the
benefit of the parties hereto and their respective successors and assigns;
provided that, except in accordance with Sections 5.04 and 5.07, the
Company and the Guarantor may not assign or transfer any of their
respective rights or obligations under this Agreement without the consent
of all Banks.
(b) Any Bank may, without the consent of the Company, but upon
prior written notification to the Company, at any time sell to one or more
banks or other financial institutions (each a "Participant") participating
interests in any Loan owing to such Bank, any Note held by such Bank, the
Commitment of such Bank hereunder, and any other interest of such Bank
hereunder; provided that no prior notification to the Company is required
in connection with the sale of a participating interest in a Money Market
Loan or a Money Market Note. In the event of any such sale by a Bank of a
participating interest to a Participant, such Bank's obligations under this
Agreement shall remain unchanged, such Bank shall remain solely responsible
for the performance thereof, such Bank shall remain the holder of its Note
or Notes, if any, for all purposes under this Agreement and the Company and
the Agents shall continue to deal solely and directly with such Bank in
connection with such Bank's rights and obligations under this Agreement.
Any agreement pursuant to which a Bank may grant such a participating
interest shall provide that such Bank shall retain the sole right and
responsibility to enforce the obligations of the Company hereunder
including, without limitation, the right to approve any amendment,
modification or waiver of any provision of this Agreement; provided that
such participation agreement may provide that such Bank will not agree to
any modification, amendment or waiver of this Agreement described in clause
(i), (ii) or (iii) of Section 10.07 affecting such Participant without the
consent of the Participant; provided further that such Participant shall be
bound by any waiver, amendment or other decision that all Banks shall be
required to abide by pursuant to a vote by Required Banks. Subject to the
provisions of Section 10.08(d), the Company agrees that each Participant
shall, to the extent provided in its participation agreement, be entitled
to the benefits of Article VIII with respect to its participating interest.
An assignment or other transfer which is not permitted by subsection (c) or
(g) below shall be given effect for purposes of this Agreement only to the
extent of a participating interest granted in accordance with this
subsection (b).
(c) (i) Any Bank may at any time sell to one or more Eligible
Institutions (each an "Assignee") all or a portion of its rights and
obligations under this Agreement and the Notes. Each Assignee shall assume
all such rights and obligations pursuant to an Assignment and Assumption
Agreement executed by such Assignee, such transferor Bank and the Company.
In no event shall (A) any Commitment of a transferor Bank (together with
the Commitment of any affiliate of such Bank), after giving effect to any
sale pursuant to this subsection (c), be less than $15,000,000, or (B) any
Commitment of an Assignee (together with the Commitment of any affiliate of
such Assignee), after giving effect to any sale pursuant to this subsection
(c), be less than $15,000,000, except in each case as may result upon the
transfer by a Bank of its Commitment in its entirety. No Bank may make an
assignment hereunder unless it makes a like ratable assignment to the same
Assignee under the $5,000,000,000 Revolving Credit Agreement among the
parties hereto, dated as of the date hereof, providing for a commitment of
364 days.
(ii) No interest may be sold by a Bank pursuant to this
subsection (c), except to an affiliate of such Bank, without the prior
written consent of the Company, which consent shall not be unreasonably
withheld. The withholding of consent by the Company shall not be deemed
unreasonable if based solely upon the Company's desire to (A) balance
relative loan exposures to such Eligible Institution among all credit
facilities of the Company or (B) avoid payment of any additional amounts
payable to such Eligible Institution under Article VIII which would arise
from such assignment.
(iii) Upon (A) execution of an Assignment and Assumption
Agreement, (B) delivery by the transferor Bank of an executed copy thereof,
together with notice that the payment referred to in clause (C) below shall
have been made, to the Company and the Administrative Agent, (C) payment by
such Assignee to such transferor Bank of an amount equal to the purchase
price agreed between such transferor Bank and such Assignee and (D) if the
Assignee is organized under the laws of any jurisdiction other than the
United States or any state thereof, evidence satisfactory to the
Administrative Agent and the Company of compliance with the provisions of
Section 10.08(f), such Assignee shall for all purposes be a Bank party to
this Agreement and shall have all the rights and obligations of a Bank
under this Agreement to the same extent as if it were an original party
hereto with a Commitment as set forth in such Assignment and Assumption
Agreement, and the transferor Bank shall be released from its obligations
hereunder to a correspondent extent, and no further consent or action by
the Company, the Banks or the Agents shall be required to effectuate such
transfer. Each Assignee shall be bound by any waiver, amendment or other
decision that all Banks shall be required to abide by pursuant to a vote by
Required Banks.
(iv) Upon the consummation of any transfer to an Assignee
pursuant to this subsection (c), the transferor Bank, the Administrative
Agent and the Company shall make appropriate arrangements so that, if
requested by the transferor Bank or the Assignee, a new Note or Notes shall
be delivered from the Company to the transferor Bank and/or such Assignee.
In connection with any such assignment, the Assignee or the transferor Bank
shall pay to the Administrative Agent an administrative fee for processing
such assignment in the amount of $2,500.
(d) No Assignee, Participant or other transferee (including any
successor Applicable Lending Office) of any Bank's rights shall be entitled
to receive any greater payment under Section 8.01 than such Bank would have
been entitled to receive with respect to the rights transferred, unless
such transfer is made with the Company's prior written consent or by reason
of the provisions of Section 8.01 or 8.03 requiring such Bank to designate
a different Applicable Lending Office under certain circumstances or at a
time when the circumstances giving rise to such greater payment did not
exist.
(e) Each Bank may, upon the written consent of the Company,
which consent shall not be unreasonably withheld, disclose to any
Participant or Assignee (each a "Transferee") and any prospective
Transferee any and all financial information in such Bank's possession
concerning the Company that has been delivered to such Bank by the Company
pursuant to this Agreement or that has been delivered to such Bank by the
Company in connection with such Bank's credit evaluation prior to entering
into this Agreement, subject in all cases to agreement by such Transferee
or prospective Transferee to comply with the provisions of Section 10.14.
(f) If pursuant to subsection (c) of this Section 10.08, any
interest in this Agreement or any Note is transferred to any Assignee that
is organized under the laws of any jurisdiction other than the United
States or any state thereof, the transferor Bank shall cause such Assignee,
concurrently with the effectiveness of such transfer, (i) to represent to
the transferor Bank (for the benefit of the transferor Bank, the Agents and
the Company) that under applicable law and treaties no taxes will be
required to be withheld by the Administrative Agent, the Company or the
transferor Bank with respect to any payments to be made to such Assignee in
respect of the Loans and (ii) to furnish to each of the transferor Bank,
the Administrative Agent and the Company two duly completed copies of the
forms required by Section 8.04(c)(i).
(g) Notwithstanding any provision of this Section 10.08 to the
contrary, any Bank may assign or pledge any of its rights and interests in
the Loans to a Federal Reserve Bank without the consent of the Company.
SECTION 10.09. Visitation. Subject to restrictions imposed by
applicable security clearance regulations, the Company will upon reasonable
notice permit representatives of any Bank at such Bank's expense to visit
any of its major properties.
SECTION 10.10. Reference Banks. If any Reference Bank assigns
its rights and obligations hereunder to an unaffiliated institution, the
Company shall, in consultation with the Administrative Agent, appoint
another Bank to act as a Reference Bank hereunder. If the Commitment of any
Bank which is also a Reference Bank is terminated pursuant to the terms of
this Agreement, the Company may, in consultation with the Administrative
Agent, appoint a replacement Reference Bank.
SECTION 10.11. Governing Law; Submission to Jurisdiction. This
Agreement and each Note shall be governed by and construed in accordance
with the internal laws of the State of New York. Each of the Company, the
Guarantor, the Agents and the Banks hereby submits to the nonexclusive
jurisdiction of the United States District Court for the Southern District
of New York and of any New York State Court sitting in New York for
purposes of all legal proceedings arising out of or relating to this
Agreement or the transactions contemplated hereby. Each of the Company, the
Guarantor, the Agents and the Banks irrevocably waives, to the fullest
extent permitted by law, any objection which it may now or hereafter have
to the laying of the venue of any such proceeding brought in such a court
and any claim that any such proceeding brought in such a court has been
brought in an inconvenient forum.
SECTION 10.12. Effectiveness; Counterparts; Integration. This
Agreement shall become effective upon receipt by the Documentation Agent of
counterparts hereof signed by each of the parties hereto (or, in the case
of any party as to which an executed counterpart shall not have been
received, receipt by the Documentation Agent in form satisfactory to it of
telegraphic, telex, facsimile or other written confirmation from such party
of execution of a counterpart hereof by such party). This Agreement may be
signed in any number of counterparts, each of which shall be an original,
with the same effect as if the signatures thereto and hereto were upon the
same instrument. This Agreement constitutes the entire agreement and
understanding among the parties hereto and supersedes any and all prior
agreements and understandings, oral or written, relating to the subject
matter hereof.
SECTION 10.13. WAIVER OF JURY TRIAL. EACH OF THE COMPANY, THE
GUARANTOR, THE AGENTS AND THE BANKS HEREBY IRREVOCABLY WAIVES ANY AND ALL
RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING
TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
SECTION 10.14. Confidentiality. Each Bank agrees, with respect
to any information delivered or made available by the Company to it that is
clearly indicated to be confidential information or private data, to use
all reasonable efforts to protect such confidential information from
unauthorized use or disclosure and to restrict disclosure to only those
Persons employed or retained by such Bank who are or are expected to become
engaged in evaluating, approving, structuring or administering this
Agreement and the transactions contemplated hereby. Nothing herein shall
prevent any Bank from disclosing such information (i) to any other Bank,
(ii) to its affiliates, officers, directors, employees, agents, attorneys
and accountants who have a need to know such information in accordance with
customary banking practices and who receive such information having been
made aware of and having agreed to the restrictions set forth in this
Section, (iii) upon the order of any court or administrative agency, (iv)
upon the request or demand of any regulatory agency or authority having
jurisdiction over such Bank, (v) which has been publicly disclosed, (vi) to
the extent reasonably required in connection with any litigation to which
either Agent, any Bank, the Company or their respective affiliates may be a
party, (vii) to the extent reasonably required in connection with the
exercise of any remedy hereunder and (viii) with the prior written consent
of the Company; provided however, that before any disclosure is permitted
under (iii) or (vi) of this Section 10.14, each Bank shall, if not legally
prohibited, notify and consult with the Company, promptly and in a timely
manner, concerning the information it proposes to disclose, to enable the
Company to take such action as may be appropriate under the circumstances
to protect the confidentiality of the information in question, and provided
further that any disclosure under the foregoing proviso be limited to only
that information discussed with the Company. The use of the term
"confidential" in this Section 10.14 is not intended to refer to data
classified by the government of the United States under laws and
regulations relating to the handling of data, but is intended to refer to
information and other data regarded by the Company as private.
SECTION 10.15. Termination and Payment under Existing
Agreements. The Company and each of the Banks that is also a party to an
agreement referred to in Section 3.01(g) agree that the "Commitments" as
defined in such agreement shall terminate in their entirety on the Closing
Date. Each such Bank waives (a) any requirement of notice of such
termination pursuant to such agreement and (b) any claim to any fees under
such agreement for any day on or after the Closing Date. The Company agrees
that (i) no loans will be outstanding under such agreements on or at any
time after the Closing Date and (ii) all accrued and unpaid fees and other
amounts due and payable under such agreements on or before the Closing Date
will be paid on or before the Closing Date.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed by their respective authorized officers as of
the day and year first above written.
LOCKHEED MARTIN CORPORATION
By /s/ Walter E. Skowronski
--------------------------
Name: Walter E. Skowronski
Title: Vice President & Treasurer
6801 Rockledge Drive
Bethesda, Maryland 20817
Attention: Walter E. Skowronski
Vice President & Treasurer
Telecopy number: (301) 897-6651
With a copy to: Frank H. Menaker, Jr.
Vice President &
General Counsel
Telecopy number: (301) 897-6333
LAC ACQUISITION CORPORATION,
As Guarantor
By /s/ Marcus C. Bennett
------------------------
Name: Marcus C. Bennett
Title: President
6801 Rockledge Drive
Bethesda, Maryland 20817
Attention: Treasurer
Telecopy number: (301) 897-6651
With a copy to: Frank H. Menaker, Jr.
Vice President &
General Counsel
Telecopy number: (301) 897-6333
MORGAN GUARANTY TRUST COMPANY OF
NEW YORK, as Documentation Agent
By /s/ Diana H. Imhof
---------------------
Name: Diana H. Imhof
Title: Vice President
60 Wall Street
New York, New York 10260
Attention: Diana Imhof
Telecopy Number: (212) 648-5014
BANK OF AMERICA NATIONAL TRUST AND
SAVINGS ASSOCIATION,
as Administrative Agent
By /s/ Charles D. Graber
------------------------
Name: Charles D. Graber
Title: Vice President
1455 Market Street
San Francisco, California 94103
Attention: Charles Graber
Telecopy number: (415) 436-2700
COMMITMENT: BANK:
$ 205,000,000 MORGAN GUARANTY TRUST COMPANY
OF NEW YORK
By /s/ Diana H. Imhof
---------------------
Name: Diana H. Imhof
Title: Vice President
$ 205,000,000 BANK OF AMERICA NATIONAL TRUST AND
SAVINGS ASSOCIATION
By /s/ Lori Y. Kannegieter
--------------------------
Name: Lori Y. Kannegieter
Title: Vice President
MANAGING AGENT
--------------
BANK:
$ 180,000,000 CITICORP USA, INC.
By /s/ Marjorie Futornick
-------------------------
Name: Marjorie Futornick
Title: Vice President
CO-AGENTS
---------
BANKS:
$ 135,000,000 ABN AMRO BANK N.V., NEW YORK BRANCH
By /s/ Frances O. Logan
-----------------------
Name: Frances O. Logan
Title: Vice President
By /s/ Thomas T. Rogers
-----------------------
Name: Thomas T. Rogers
Title: Assistant Vice President
$ 135,000,000 BANK OF MONTREAL
By /s/ Tom Brino
----------------
Name: Tom Brino
Title: Director
$ 135,000,000 THE BANK OF NEW YORK
By /s/ Gregory P. Shefrin
-------------------------
Name: Gregory P. Shefrin
Title: Assistant Vice President
$ 135,000,000 THE BANK OF NOVA SCOTIA
By /s/ James R. Trimble
-----------------------
Name: James R. Trimble
Title: Senior Relationship Manager
$ 135,000,000 BANKERS TRUST COMPANY
By /s/ Gina S. Thompson
-----------------------
Name: Gina S. Thompson
Title: Vice President
$ 135,000,000 BANQUE NATIONALE DE PARIS - NEW YORK
BRANCH
By /s/ Richard L. Sted
----------------------
Name: Richard L. Sted
Title: Senior Vice President
By /s/ Thomas N. George
-----------------------
Name: Thomas N. George
Title: Vice President
BANQUE NATIONALE DE PARIS, GEORGETOWN
BRANCH, CAYMAN ISLANDS
By /s/ Richard L. Sted
----------------------
Name: Richard L. Sted
Title: Senior Vice President
By /s/ Thomas N. George
-----------------------
Name: Thomas N. George
Title: Vice President
$ 135,000,000 CANADIAN IMPERIAL BANK OF COMMERCE
By /s/ W. Barrie Anderson
-------------------------
Name: W. Barrie Anderson
Title: Authorized Signatory
$ 135,000,000 CHEMICAL BANK
By /s/ James B. Treger
----------------------
Name: James B. Treger
Title: Vice President
$ 135,000,000 COMMERZBANK AG, NEW YORK BRANCH
By /s/ Andrew R. Campbell
-------------------------
Name: Andrew R. Campbell
Title: Assistant Cashier
By /s/ Jurgen Schmieding
------------------------
Name: Jurgen Schmieding
Title: Vice President
$ 135,000,000 CREDIT LYONNAIS, CAYMAN ISLANDS BRANCH
By /s/ Robert Ivosevich
-----------------------
Name: Robert Ivosevich
Title: Authorized Signature
CREDIT LYONNAIS, NEW YORK BRANCH
By /s/ Robert Ivosevich
-----------------------
Name: Robert Ivosevich
Title: Senior Vice President
$ 135,000,000 CREDIT SUISSE
By /s/ Eileen O'Connell Fox
---------------------------
Name: Eileen O'Connell Fox
Title: Member of Senior Management
By /s/ Andrea E. Shkane
-----------------------
Name: Andrea E. Shkane
Title: Member of Senior Management
$ 135,000,000 THE DAI-ICHI KANGYO BANK, LTD.
By /s/ Tomohiro Nozaki
----------------------
Name: Tomohiro Nozaki
Title: Senior Vice President
and Joint General Manager
$ 135,000,000 DEUTSCHE BANK AG, NEW YORK BRANCH
AND/OR CAYMAN ISLANDS BRANCH
By /s/ James Fox
----------------
Name: James Fox
Title: Assistant Vice President
By /s/ Robert M. Wood, Jr.
--------------------------
Name: Robert M. Wood, Jr.
Title: Vice President
$ 135,000,000 FIRST INTERSTATE BANK OF CALIFORNIA
By /s/ Peter G. Olson
---------------------
Name: Peter G. Olson
Title: Senior Vice President
By /s/ Lancy Gin
----------------
Name: Lancy Gin
Title: Assistant Vice President
$ 135,000,000 THE FIRST NATIONAL BANK OF CHICAGO
By /s/ Lynn R. Dillon
---------------------
Name: Lynn R. Dillon
Title: Vice President
$ 135,000,000 THE INDUSTRIAL BANK OF JAPAN TRUST
COMPANY
By /s/ Robert W. Ramage
-----------------------
Name: Robert W. Ramage
Title: Senior Vice President
$ 135,000,000 MELLON BANK, N.A.
By /s/ Laurie G. Dunn
---------------------
Name: Laurie G. Dunn
Title: Vice President
$ 135,000,000 BANK OF TOKYO-MITSUBISHI TRUST COMPANY
By /s/ Naoshi Kinoshita
-----------------------
Name: Naoshi Kinoshita
Title: Vice President
$ 135,000,000 THE MITSUBISHI TRUST AND BANKING
CORPORATION
By /s/ Patricia Loret de Mola
-----------------------------
Name: Patricia Loret de Mola
Title: Vice President
$ 135,000,000 NATIONAL WESTMINSTER BANK PLC,
LOS ANGELES OVERSEAS BRANCH
By /s/ Marilyn A. Windsor
-------------------------
Name: Marilyn A. Windsor
Title: Vice President
NATIONAL WESTMINSTER BANK PLC, NASSAU
BRANCH
By /s/ Marilyn A. Windsor
-------------------------
Name: Marilyn A. Windsor
Title: Vice President
$ 135,000,000 NATIONSBANK, N.A.
By /s/ John D. Mindnich
-----------------------
Name: John D. Mindnich
Title: Senior Vice President
$ 135,000,000 ROYAL BANK OF CANADA
By /s/ Don S. Bryson
--------------------
Name: Don S. Bryson
Title: Senior Manager
$ 135,000,000 THE SANWA BANK, LIMITED - NEW YORK
BRANCH
By /s/ Dominic J. Sorresso
--------------------------
Name: Dominic J. Sorresso
Title: Vice President
$ 135,000,000 SOCIETE GENERALE
By /s/ Ralph Saheb
------------------
Name: Ralph Saheb
Title: Vice President
$ 135,000,000 THE SUMITOMO BANK, LIMITED, NEW YORK
BRANCH
By /s/ Yoshinori Kawamura
-------------------------
Name: Yoshinori Kawamura
Title: Joint General Manager
$ 135,000,000 WACHOVIA BANK OF GEORGIA, N.A.
By /s/ Mark S. Rogus
--------------------
Name: Mark S. Rogus
Title: Senior Vice President
PARTICIPANTS
------------
BANKS:
$ 50,000,000 BANCA COMMERCIALE ITALIANA, NEW YORK
BRANCH
By /s/ Charles P. Dougherty
---------------------------
Name: Charles P. Dougherty
Title: Vice President
By /s/ Tiziano Gallonetto
-------------------------
Name: Tiziano Gallonetto
Title: Assistant Vice President
$ 50,000,000 BANCA NAZIONALE DEL LAVORO S.P.A.
By /s/ Giuliano Violetta
------------------------
Name: Giuliano Violetta
Title: First Vice President
By /s/ Adolph S. Mascari, Jr.
-----------------------------
Name: Adolph S. Mascari, Jr.
Title: Assistant Vice President
$ 50,000,000 BZW DIVISION OF BARCLAYS BANK PLC
By /s/ John C. Livingston
-------------------------
Name: John C. Livingston
Title: Director
$ 50,000,000 BAYERISCHE LANDESBANK GIROZENTRALE,
CAYMAN ISLANDS BRANCH
By /s/ Wilfried Freudenberger
-----------------------------
Name: Wilfried Freudenberger
Title: Executive Vice President
and General Manager
By /s/ Peter Obermann
---------------------
Name: Peter Obermann
Title: Senior Vice President
Manager Lending Division
$ 50,000,000 CORESTATES BANK, N.A.
By /s/ Matthew T. Panarese
--------------------------
Name: Matthew T. Panarese
Title: Vice President
$ 50,000,000 FLEET BANK OF MASSACHUSETTS, N.A.
By /s/ Frank Benesh
-------------------
Name: Frank Benesh
Title: Vice President
$ 50,000,000 THE FUJI BANK, LIMITED, NEW YORK BRANCH
By /s/ Teiji Teramoto
---------------------
Name: Teiji Termaoto
Title: Vice President & Manager
$ 50,000,000 GULF INTERNATIONAL BANK B.S.C.
By /s/ Thomas E. Fitzherbert
----------------------------
Name: Thomas E. Fitzherbert
Title: Vice President
By /s/ Issa N. Baconi
---------------------
Name: Issa N. Baconi
Title: Senior Vice President
& Branch Manager
$ 50,000,000 ISTITUTO BANCARIO SAN PAOLO DI TORINO
S.P.A.
By /s/ Gerard M. McKenna
------------------------
Name: Gerard M. McKenna
Title: Vice President
By /s/ Wendell H. Jones
-----------------------
Name: Wendell H. Jones
Title: Vice President
$ 50,000,000 KREDIETBANK N.V.
By /s/ Robert Snauffer
----------------------
Name: Robert Snauffer
Title: Vice President
By /s/ Armen Karozichan
-----------------------
Name: Armen Karozichan
Title: Vice President
$ 50,000,000 MARINE MIDLAND BANK
By /s/ Mary Ann Tappero
-----------------------
Name: Mary Ann Tappero
Title: Vice President
$ 50,000,000 PNC BANK, NATIONAL ASSOCIATION
By /s/ Mark W. Biedermann
-------------------------
Name: Mark W. Biedermann
Title: Assistant Vice President
$ 50,000,000 THE SAKURA BANK, LTD.
By /s/ Masahiro Nakajo
----------------------
Name: Masahiro Nakajo
Title: Senior Vice President
& Manager
$ 50,000,000 SUNTRUST BANK, ATLANTA
By /s/ Jarrette A. White, III
-----------------------------
Name: Jarrette A. White, III
Title: Vice President
By /s/ Brian K. Peters
----------------------
Name: Brian K. Peters
Title: Vice President
$ 50,000,000 THE TOKAI BANK, LIMITED, NEW YORK BRANCH
By /s/ Stuart M. Schulman
-------------------------
Name: Stuart M. Schulman
Title: Senior Vice President
$ 50,000,000 THE TORONTO DOMINION (NEW YORK), INC.
By /s/ Jorge A. Garcia
----------------------
Name: Jorge A. Garcia
Title: Vice President
$ 50,000,000 UNION BANK OF SWITZERLAND, NEW YORK
BRANCH
By /s/ James P. Kelleher
------------------------
Name: James P. Kelleher
Title: Assistant Vice President
By /s/ Peter B. Yearly
----------------------
Name: Peter B. Yearly
Title: Managing Director
$ 50,000,000 WESTDEUTSCHE LANDESBANK GIROZENTRALE,
NEW YORK BRANCH
By /s/ Salvatore Battinelli
---------------------------
Name: Salvatore Battinelli
Title: Vice President
Credit Department
By /s/ Alan S. Bookspan
-----------------------
Name: Alan S. Bookspan
Title: Vice President
TOTAL COMMITMENTS:
$5,000,000,000
SCHEDULE I
LOCKHEED MARTIN CORPORATION
PRICING SCHEDULE
FIVE YEAR REVOLVER
The Eurodollar Margin, the CD Margin and the Facility Fee shall be as
specified below (in basis points per annum).
LORAL CORPORATION
600 Third Avenue
New York, New York 10016
as of April 15, 1996
Lockheed Martin Corporation
LAC Acquisition Corporation
6801 Rockledge Drive
Bethesda, Maryland 20817
Re: Amendment of Agreement and Plan of Merger
dated as of January 7, 1996
Ladies and Gentlemen:
Reference is made to the Agreement and Plan of
Merger dated as of January 7, 1996 (the "Merger
Agreement") among Lockheed Martin Corporation ("Parent"),
LAC Acquisition Corporation ("Purchaser") and Loral
Corporation (the "Company"). Terms not specifically
defined herein shall have the meanings set forth in the
Merger Agreement. The following sets forth our mutual
agreement with respect to certain matters relating to the
Merger Agreement.
1. The parties agree that the parenthetical
contained in the second sentence of Section 2.10 of the
Merger Agreement shall be amended to read as follows:
"(including, if so authorized by the
Company's Board of Directors, holders who
are subject to the reporting requirements
of Section 16(a) of the Exchange Act)."
Please indicate your acceptance of and
agreement to the foregoing Amendment of Agreement and
Plan of Merger by signing below.
Very truly yours,
LORAL CORPORATION
By:_______________________
Name:
Title:
ACCEPTED AND AGREED AS OF
APRIL 15, 1996:
LOCKHEED MARTIN CORPORATION
By:_________________________
Name:
Title:
LAC ACQUISITION CORPORATION
By:_________________________
Name:
Title:
SHAREHOLDERS AGREEMENT
dated as of April 22, 1996
by and among
LORAL CORPORATION,
and
LORAL SPACE & COMMUNICATIONS LTD.
SHAREHOLDERS AGREEMENT
SHAREHOLDERS AGREEMENT, dated as of April 22, 1996 (the
"AGREEMENT"), by and among Loral Corporation, a New York corporation
("LORAL"), and Loral Space & Communications Ltd., a Bermuda company (the
"COMPANY"). Loral and those of its Affiliates who are transferees with
respect to any of the Equity Securities (as defined below), are sometimes
collectively referred to herein as the "SHAREHOLDERS".
RECITALS:
WHEREAS, Lockheed Martin Corporation, a Maryland corporation
("LMC"), Loral and certain subsidiaries of Loral entered into a
Restructuring, Financing and Distribution Agreement, dated as of January 7,
1996 (the "RESTRUCTURING AGREEMENT"; all capitalized terms used in this
Agreement but not otherwise defined herein, shall have the respective
meanings assigned to such terms in the Restructuring Agreement), pursuant
to which, after giving effect to the Restructuring and the Distribution,
Loral acquired _______ shares of Series A Convertible Preferred Stock, par
value $0.01 per share, of the Company (the "PREFERRED Stock"); and
WHEREAS, the Company and Loral desire to establish in this
Agreement certain conditions with respect to the relationship between the
Shareholders and the Company;
NOW, THEREFORE, in consideration of the mutual covenants and
agreements contained herein and in the Restructuring Agreement, the parties
hereto agree as follows:
I.
STANDSTILL AND VOTING PROVISIONS
1.1. Restrictions on Certain Actions by the Shareholders.
(a) During the Term (as defined in Article V below), each Stockholder will
not, and will cause each of its Affiliates (such term, as used in this
Agreement, as defined in Rule 12b-2 of the General Rules and Regulations
under the Exchange Act) not to, singly or as part of a partnership, limited
partnership, syndicate or other group (as those terms are used in Section
13(d)(3) of the Exchange Act), directly or indirectly:
(i) acquire, offer to acquire, or agree to acquire,
by purchase, gift or otherwise, any Equity Securities (as defined
below in Section 1.1(c)), except pursuant to a stock split, stock
dividend, rights offering, recapitalization, reclassification,
merger, consolidation, corporate reorganization or similar
transaction; provided that at any time in which the Shareholders
hold, in the aggregate, less than twenty percent (20%) of the Total
Voting Power, then the Shareholders may acquire Equity Securities
so that the Shareholders hold, in the aggregate, up to twenty
percent (20%) of the Total Voting Power;
(ii) make, or in any way actively participate in, any
"solicitation" of "proxies" to vote (as such terms are defined in
Rule 14a-1 under the Exchange Act), solicit any consent or
communicate with or seek to advise or influence any third party
with respect to the voting of any Equity Securities or become a
"participant" in any "election contest" (as such terms are defined
or used in Rule 14a-11 under the Exchange Act), in each case with
respect to the Company, except as expressly provided in Section
1.7;
(iii) form, join or encourage the formation of, any
"person" or "group" within the meaning of Section 13(d) of the
Exchange Act with respect to any Equity Securities; provided that
this Section 1.1(a)(iii) shall not prohibit any such arrangement
solely among the Shareholders and any of their respective
Affiliates;
(iv) deposit any Equity Securities into a voting
trust or subject any such Equity Securities to any arrangement or
agreement with respect to the voting thereof; provided that this
Section 1.1(a)(iv) shall not prohibit any such arrangement solely
among the Shareholders and any of their respective Affiliates;
(v) initiate, propose or otherwise solicit
Shareholders for the approval of one or more stockholder proposals
with respect to the Company as described in Rule 14a-8 under the
Exchange Act, or induce or attempt to induce any other third party
to initiate any stockholder proposal, except as expressly provided
in Section 1.7;
(vi) except as otherwise contemplated or permitted by
this Agreement (including, without limitation, pursuant to Section
1.2 or 1.7 hereof), seek to place a representative on the Board of
Directors of the Company or seek the removal of any member of the
Board of Directors of the Company, except with the approval of the
Board of Directors or management of the Company;
(vii) except with the approval of the Board of
Directors or management of the Company, call or seek to have called
any meeting of the Shareholders of the Company;
(viii) except through its representatives on the
Board of Directors (or any committee thereof) of the Company (if
any) and except as otherwise contemplated by this Agreement or the
Restructuring Agreement (including the agreements and other
documents referred to therein, including, without limitation, the
Tax Sharing Agreement), otherwise act to seek to control the
management or policies of the Company, except with the approval of
the Board of Directors or management of the Company;
(ix) sell or otherwise transfer in any manner any
Equity Securities to any "person" (within the meaning of Section
13(d)(3) of the Exchange Act) who, immediately following such sale
or transfer, would, to the best of the Stockholder's knowledge, own
more than four percent (4%) of any class of Equity Securities or
who, without the approval of the Board of Directors of the Company,
(A) has publicly proposed a business combination or similar
transaction with, or a change of control of, the Company or who has
publicly proposed a tender offer for Equity Securities or (B) who
has discussed with Loral or any of its respective Affiliates the
possibility of proposing a business combination or similar
transaction with, or a change in control of, the Company;
(x) sell or otherwise transfer in any manner to any
person (as defined in clause (ix) above) in any single transaction
or series of related transactions more than 2% of the outstanding
Equity Securities;
(xi) solicit, seek to effect, negotiate with or
provide any information to any other party with respect to, or make
any statement or proposal, whether written or oral, to the Board of
Directors of the Company or any director or officer of the Company
or otherwise make any public announcement or proposal whatsoever
with respect to, any form of business combination transaction
involving the Company, including, without limitation, a merger,
exchange offer or liquidation of the Company's assets, or any
corporate reorganization or similar transaction with respect to the
Company, except in each case with the approval of the Board of
Directors or management of the Company; or
(xii) instigate or encourage any third party to do
any of the foregoing.
Notwithstanding clauses (ix) and (x) above, the Shareholders
may effect any transaction contemplated by Article III hereof.
(b) Notwithstanding the provisions of this Section 1.1,
nothing herein shall apply with respect to any Equity Securities acquired
from any person other than a Stockholder (x) held by any pension,
retirement or other benefit plan managed by any Stockholder or any of its
subsidiaries or other Affiliates or (y) held in any account managed for the
benefit of another person, by any subsidiary or other Affiliate of any of
the Shareholders which is engaged in the financial services business. In
addition, notwithstanding the provisions of this Section 1.1, nothing
herein shall prohibit or restrict any transfer of Equity Securities to or
among any of the subsidiaries or other Affiliates of any of the
Shareholders (provided that such subsidiary or Affiliate agrees to be bound
to the provisions of this Agreement, upon which such subsidiary or
Affiliate shall be entitled to all rights and benefits, and shall be
subject to all obligations, of a Stockholder under this Agreement).
(c) For the purposes of this Agreement, (i) the term "EQUITY
SECURITIES" shall mean the Preferred Stock and any securities entitled to
vote generally in the election of directors of the Company, or any direct
or indirect rights or options to acquire any such securities or any
securities convertible or exercisable into or exchangeable for such
securities (provided that, in the event that the Guaranty Warrants (as
defined below) become warrants to acquire Equity Securities, such Guaranty
Warrants and any securities issued pursuant to the exercise of such
Guaranty Warrants, shall not (so long, in each case, as they are held by
the Stockholder) constitute Equity Securities for purposes of determining
the appropriate number of shares of Common Equity Securities which Loral is
entitled to acquire hereunder, including in connection with the
determination of the Target Percentage pursuant to Section 1.4(a) hereof),
(ii) the term "VOTING POWER" shall mean the voting power in the general
election of directors of the Company, (iii) the term "TOTAL VOTING POWER"
shall mean the total combined Voting Power of all the Equity Securities
then outstanding, including, without limitation, the Preferred Stock, and,
insofar as the Preferred Stock is concerned, it is deemed to have Voting
Power equal to that of the Common Stock into which it is convertible, (iv)
the term "CHANGE OF CONTROL" shall mean the occurrence of any of the
following events: (A) any "person" or "group" (as such terms are used in
Sections 13(d) and 14(d) of the Exchange Act) is or becomes the beneficial
owner of Equity Securities which represent at least forty percent (40%) of
the Total Voting Power, or (B) during any one-year period, individuals who
at the beginning of such period constituted the Board of Directors of the
Company (together with any new directors whose election by such Board of
Directors or whose nomination for election by the shareholders of the
Company was approved by a vote of a majority of the directors of the
Company then still in office who were either directors at the beginning of
such period or whose election or nomination for election was previously so
approved) cease for any reason to constitute a majority of the Board of
Directors of the Company then in office, (v) the term "BENEFICIAL OWNER",
and terms having similar import, shall mean any direct or indirect
"beneficial owner", as such term is defined in Rules 13d-3 and 13d-5 under
the Exchange Act, and (vi) the term "GUARANTY WARRANTS" shall mean those
warrants which accrue to the benefit of the Company in connection with the
Globalstar Bank Guarantee, as described in the Globalstar Warrant
Memorandum.
1.2. HSR Clearance.
(a) At any time after the date hereof (but subject to the
provisions of Section 1.2(b) below), following a written request by Loral
to the Company (such request, the "HSR NOTICE"), the Company and the
Shareholders will (i) take promptly all actions necessary to make the
filings required of the Shareholders, the Company or any of their
respective Affiliates under the HSR Act (as defined in the Merger
Agreement) with respect to the right to convert Preferred Stock and
continue to own the securities so received, the ownership and voting of
Equity Securities by the Shareholders, any of the transactions contemplated
by this Agreement or any other similar matters (all such exercise,
ownership, voting, transaction and other similar matters, the "FILING
MATTERS"), (ii) comply at the earliest practicable date with any request
for additional information or documentary material received by the Company
or the Shareholders or any of their Affiliates from any of the Federal
Trade Commission, the Antitrust Division of the Department of Justice,
state attorneys general, the Commission, or other governmental or
regulatory authorities (all such authorities, the "ANTITRUST AUTHORITIES"),
and (iii) cooperate with each other in connection with any of the filings
referred to in clause (i) above and in connection with resolving any
investigation or other inquiry commenced by any of the Antitrust
Authorities. To the extent reasonably requested by Loral, the Company shall
use all reasonable efforts to resolve such objections, if any, as may be
asserted with respect to the Filing Matters. If any administrative,
judicial or legislative action or proceeding is instituted (or threatened
to be instituted) challenging any aspect of the Filing Matters as violative
of any Antitrust Law, each of the Shareholders and the Company shall
cooperate with each other to contest and resist any such action or
proceeding, and to have vacated, lifted, reversed or overturned any decree,
judgment, injunction or other order (whether temporary, preliminary or
permanent) that is in effect and that restricts, prevents or prohibits the
exercise by the Shareholders of the right to convert Preferred Stock and
continue to own the securities so received, or the exercise by Loral of its
rights with respect to the ownership and voting of Equity Securities or any
of the transactions contemplated by this Agreement (any such decree,
judgment, injunction or other order is hereafter referred to as an
"ORDER"), including, without limitation, by pursuing all reasonable avenues
of administrative and judicial appeal, provided that nothing contained in
this Section 1.2(a) shall be construed to require any party hereto to hold
separate or divest any of their respective assets or businesses or agree to
any substantive restriction thereon or on the conduct thereof. Each of the
Company and Loral shall promptly inform the other party of any material
communication received by such party from any Antitrust Authority regarding
any of the Filing Matters or any of the other transactions contemplated
hereby. For the purposes of this Agreement, the term "HSR CLEARANCE DATE"
shall mean the first date on which (x) any applicable waiting period under
the HSR Act with respect to the Filing Matters shall have expired or been
terminated, (y) there shall not be pending any Action commenced by any
Antitrust Authority relating to any of the Filing Matters or any of the
other transactions contemplated hereby, and (z) there shall not be in
effect any Order.
(b) Notwithstanding the provisions of Section 1.2(a) above,
in the event that Loral delivers the HSR Notice to the Company, the Company
shall be entitled to postpone for a reasonable period of time (but in no
event later than 45 days), any filing referred to in Section 1.2(a)(i)
above if the Company determines in its reasonable judgment and in good
faith that such filing would delay the obtaining of any approval from an
Antitrust Authority with respect to any announced or imminent material
acquisition or disposition which would require a filing by the Company
under the HSR Act. In the event of such postponement, Loral shall have the
right to withdraw its HSR Notice and may deliver any such HSR Notice at any
time thereafter.
1.3. Voting.
(a) General Voting Provisions. Prior to the HSR Clearance
Date, no Stockholder shall have the right to convert Preferred Stock into
common stock or the right to vote any Equity Securities with respect to the
election of directors of the Company. Following the HSR Clearance Date,
each Stockholder shall have the right to vote its Equity Securities to the
extent permitted by the terms thereof on any matters submitted to a vote of
the Shareholders of the Company, provided that following the HSR Clearance
Date any Stockholder shall have the right to vote any Equity Securities to
the extent permitted by the terms thereof with respect to the election of
directors of the Company without restriction, provided that, except as
expressly provided in Section 1.7, in the event of an "election contest"
(as such term is used in Rule 14a-11 under the Exchange Act) each
Stockholder shall have the right to vote in the election contest only (i)
as recommended by the Board of Directors or management of the Company or
(ii) in the same proportions as the holders of Equity Securities (other
than Shareholders) vote their Securities. On each matter with respect to
which a Stockholder is entitled to vote pursuant to this Section 1.3, each
such Stockholder shall be present, in person or represented by proxy, at
all such stockholder meetings of the Company so that all Equity Securities
beneficially owned by it shall be counted for the purpose of determining
the presence of a quorum at such meetings.
(b) Company Call. If, within one year following the date
hereof, the Shareholders vote against any Call Event Triggering Transaction
(as defined below), the Company shall have the right, for 10 days following
the date on which such vote is held, to purchase, and the Shareholders
shall be required to sell to the Company, all, but not less than all, of
the Equity Securities held by the Shareholders at a per share cash price
equal to the Call Event Trigger Price (as defined below). The Company may
exercise such right by delivering to each Stockholder, within such 10-day
period, a written notice stating that the Company has irrevocably agreed to
purchase in cash all (but not less than all) of the Equity Securities held
by the Shareholders at the Call Event Trigger Price upon the terms and
conditions set forth in this Section 1.3(b). The closing with respect to
the purchase of Equity Securities by the Company pursuant to this Section
1.3(b) shall be on a mutually determined closing date which shall not be
more than 15 days after the date on which the Company's written notice
referred to above is delivered to the Shareholders. The closing shall be
held at 10:00 A.M., local time, at the principal office of the Company, or
at such other time or place as the parties mutually agree. On such closing
date, each Stockholder shall deliver (i) certificates representing the
shares of Equity Securities being sold, free and clear of any lien, claim
or encumbrance, and (ii) such instruments of transfer and evidence of
ownership and authority as the Company may reasonably request. The purchase
price shall be paid by the Company to each Stockholder by wire transfer of
immediately available funds no later than 2:00 P.M. on the closing date to
the account(s) designated by the Shareholders prior to such closing date.
(c) Certain Definitions. For purposes of Section 1.3,
(i) the term "CALL EVENT TRIGGERING TRANSACTION"
shall mean a transaction between the Company, on the one hand, and
any Spinco Company (or any other Subsidiary of either the Company
or a Spinco Company), on the other hand, involving (x) any merger,
consolidation, corporate reorganization or similar transaction
involving the Company; or (y) any sale, lease, exchange, transfer
or other disposition, directly or indirectly, in a single
transaction or series of related transactions, of all or
substantially all of the assets of the Company or any of its
Affiliates; provided that the term "Call Event Triggering
Transaction" shall not include any transaction involving any party
which is not a Spinco Company (or any other Subsidiary of either
the Company or a Spinco Company); and
(ii) the term "CALL EVENT TRIGGER PRICE" shall mean
the sum of (x) $344,000,000.00, plus (y) all amounts expended by
the Shareholders following the date hereof in connection with the
acquisition of Equity Securities other than acquisitions from
another Stockholder following the date hereof, minus (z) any net
sales proceeds received by the Shareholders following the date
hereof in connection with the sale of Equity Securities (other than
sales to another Stockholder) following the date hereof.
1.4. Loral Option.
(a) General Provisions Relating to Loral Option. If, within
five years following the date hereof, any Option Event Triggering
Transaction (as defined below) occurs, Loral shall have the right, within
90 days after the consummation of the Option Event Triggering Transaction,
to purchase, and the Company (for purposes of this Section 1.4, all
references to the "COMPANY" shall be deemed to include the Surviving
Corporation (as defined below), shall be required to sell to Loral, a
number of shares of Preferred Stock which would cause Loral to own Equity
Securities with Voting Power equal to the Target Percentage (as defined
below) of the Total Voting Power immediately after giving effect to the
consummation of the Option Event Triggering Transaction, at a per share
cash price equal to the Option Event Trigger Price (as defined below).
Loral may exercise such right by delivering to the Company, within such
90-day period, a written notice stating that Loral (or any Subsidiary of
Loral designated by Loral; for purposes of this Section 1.4, all references
to "LORAL" shall be deemed to include such designated Subsidiary) has
irrevocably agreed to purchase in cash the number of shares of Preferred
Stock specified in the preceding sentence, at the Option Event Trigger
Price, upon the terms and conditions set forth in this Section 1.4. The
closing with respect to the purchase of Preferred Stock by the Company
pursuant to this Section 1.4 shall be on a mutually determined closing date
which shall not be more than 15 days after the date on which Loral's
written notice referred to above is delivered to the Company. The closing
shall be held at 10:00 A.M., local time, at the principal office of the
Company, or at such other time or place as the parties mutually agree. On
such closing date, the Company shall issue to Loral certificates
representing the shares of Preferred Stock being sold, which shall be
validly issued, fully paid and non-assessable and free and clear of any
lien, claim or encumbrance. The purchase price shall be paid by Loral to
the Company by wire transfer of immediately available funds no later than
2:00 P.M. on the closing date to the account designated in writing by the
Company prior to such closing date. For purposes of this Section 1.4,
(i) the term "OPTION EVENT TRIGGERING TRANSACTION"
shall mean a transaction involving as parties, among others, the
Company or any of its Affiliates (other than GTL and Globalstar),
on the one hand, and either GTL or Globalstar or any of their
respective Subsidiaries, on the other hand, involving either (x) a
Call Event Triggering Transaction (including, without limitation, a
similar transaction involving the merger, consolidation,
reorganization, sale, lease, exchange, transfer or other
disposition of all or substantially all of the assets, of
Globalstar, GTL or their respective Subsidiaries) or the
liquidation or (y) dissolution of the Company;
(ii) the term "OPTION EVENT TRIGGER PRICE" shall mean
with respect to an Option Event Trigger Transaction occurring (x)
on or prior to the first anniversary hereof, a $6.00 per share cash
purchase price, subject to adjustment pursuant to the provisions of
Section 1.4(b) hereof or (y) after the first anniversary hereof but
on or prior to the fifth anniversary hereof, a per share price
equal to 80% of the per share price of the Company implicit in the
Option Event Triggering Transaction;
(iii) the term "SURVIVING CORPORATION" shall mean any
successor to the rights and obligations of the Company as a result
of or in connection with any Option Event Triggering Transaction;
and
(iv) the term "TARGET PERCENTAGE" shall mean a
percentage amount equal to the percentage of the Total Voting Power
represented by the Equity Securities held by the Shareholders
immediately prior to the closing of the Option Event Triggering
Transaction; provided, however, that if there has occurred within
the five days preceding such closing an event that diluted the
Voting Power of the Equity Securities held by the Shareholders, the
Target Percentage shall be determined as of the date five days
prior to the closing of such Option Event Triggering Transaction.
(b) Adjustment of Loral Option Event Trigger Price. The
Option Event Trigger Price shall be equitably adjusted from time to time
after the date hereof to take into account of any of the following events:
(i) if the Company shall pay a dividend or make any other distribution with
respect to any Equity Securities which is payable in the form of Equity
Securities or in the form of any other Asset (other than normal, periodic
cash dividends of the Company), (ii) if the Company shall subdivide its
outstanding common stock, (iii) if the Company shall combine its
outstanding common stock into a smaller number of shares, (iv) if the
Company shall issue any shares of its capital stock in a reclassification
of the Common Stock (including any such reclassification in connection with
a merger, consolidation or other business combination involving the
Company), or (v) in any other similar transaction affecting the Company or
the number or value of the outstanding Equity Securities. The parties
acknowledge and agree that each such equitable adjustment shall preserve
for Loral the economic benefits of the Loral option set forth in Section
1.4(a) above.
1.5. Globalstar Warrant Put Option. In the event of any of
the following transactions (each such transaction, a "WARRANT TRIGGER
EVENT"):
(i) any merger, consolidation, corporate reorganization or
similar transaction involving Globalstar or GTL;
(ii) any sale, lease, exchange, transfer or other
disposition, directly or indirectly, of all or substantially all of
the assets of Globalstar or GTL; or
(iii) any liquidation or dissolution of Globalstar or GTL;
in which it is proposed that the Globalstar Warrants be converted into cash
or the right to receive cash, or any other interest (or the right to
receive any other interest) in Globalstar other than common stock thereof
the Shareholders shall have the right (the "LIMITED WARRANT PUT") to
require the Company to purchase the Globalstar Warrants for a price equal
to their Option Privilege Value (as defined below). The Shareholders may
exercise the Limited Warrant Put by delivering to the Company, at least 10
days prior to the scheduled closing of the Warrant Trigger Event, a notice
to such effect accompanied by appropriate documentation or certificates
evidencing the Globalstar Warrants. The Option Privilege Price shall be
payable by the Company 10 days after the determination thereof. As used
herein, the term "OPTION PRIVILEGE PRICE" means the greater of (x) the
consideration payable in respect of the Globalstar Warrants in the Warrant
Trigger Event and (y) the hypothetical fair market value that would be
assigned to the Globalstar Warrants at the date of the Warrant Trigger
Event assuming (1) that no Warrant Trigger Event were to occur then or at
any time prior to the expiration of the Globalstar Warrants, (2) that the
Globalstar Warrants would remain outstanding until such expiration in
accordance with their terms, exercisable for shares of or interests in the
issuer thereof, and (3) that such issuer would remain a public company
during such period. The Option Privilege Price shall be determined by an
investment banking firm of national standing selected by agreement of the
Company and the Shareholders or, failing such agreement, by agreement of
Bear Stearns Co. Inc. and Lehman Brothers. Such investment banking firm
shall, in determining the Option Privilege Price, give full effect to (i)
the spread between the exercise price and the fair market value of the
securities into which the Globalstar Warrants are exercisable and (ii) the
value of the "option privilege" in the Globalstar Warrants (that is, the
value of the right, without risking any capital, to speculate on and
benefit from appreciation in the underlying securities).
1.6. Required Sales by Shareholders.
(a) Immediately following any repurchase by the Company of
any of its outstanding Equity Securities which repurchase has the effect of
increasing the Total Voting Power of all Shareholders to an amount in
excess of 20% of Total Voting Power (a "REPURCHASE EVENT"), the Company
shall give written notice (the "REPURCHASE EVENT NOTICE") thereof to each
Stockholder. The Repurchase Event Notice shall set forth in reasonable
detail the transactions resulting in the Repurchase Event, specify the
Repurchase Price (as defined in Section 1.6(c) hereof) and set a date (the
"REPURCHASE DATE") for the repurchase by the Company of the Adjustment
Securities (as defined in Section 1.6(b) hereof) as contemplated by Section
1.6(b) hereof. The Repurchase Date shall be not sooner than 15 nor later
than 25 business days after either (i) the date the Repurchase Event Notice
is sent to the Stockholder or (ii) if the provisions of Section 1.6(d)(ii)
hereof are applicable, the Section 16(d) Date (as defined in Section
1.6(d)(ii) hereof).
(b) Subject to the provisions of Section 1.6(c) and (d)
hereof, on the Repurchase Date the Company shall purchase from each
Stockholder and each Stockholder shall sell to the Company, a number of
shares of Equity Securities (the "ADJUSTMENT SECURITIES") held by the
Stockholder equal to the product of (i) the aggregate number of shares of
Equity Securities of all Shareholders less the aggregate number of shares
of Equity Securities constituting 20% of the Total Voting Power, multiplied
by (ii) the number of shares of Equity Securities held by the Stockholder
divided by the number of shares of Equity Securities held by all
Shareholders. The closing with respect to the purchase of Adjustment
Securities shall be held on the Repurchase Date at 10:00 a.m. local time at
the principal office of the Company, or at such other place and time as the
parties mutually agree. On the Repurchase Date each Stockholder (other than
an Electing Stockholder (as defined in Section 1.6(d) hereof)) shall
deliver (i) certificates representing the Adjustment Securities free and
clear of any lien, claim or encumbrance, and (ii) such instruments of
transfer and evidence of ownership and authority as the Company may
reasonably request. The Company shall pay the purchase price to the
Stockholder by wire transfer of immediately available funds no later than
2:00 p.m. on the Repurchase Date to an account designated by the
Stockholder prior to the Repurchase Date.
(c) The per share repurchase price of the Adjustment
Securities (the "REPURCHASE PRICE") shall be equal to the per share price
paid by the Company in respect of the repurchase of Equity Securities
resulting in the Repurchase Event; provided, that if after the immediately
preceding Repurchase Event (or if none, the date of this Agreement) (the
"PRIOR REPURCHASE EVENT") the Company has repurchased Equity Securities at
different prices, then the Repurchase Price shall be equal to the highest
per share price paid by the Company to repurchase Equity Securities after
the Prior Repurchase Event (exclusive of repurchases after which the
Stockholder's Total Voting Power was less than or equal to 20%); provided,
however, that if pursuant to the preceding provisions of this Section
1.6(c) the Repurchase Price would be less than the Initial Purchase Price
(as defined below), then each Stockholder may elect to sell the Adjustment
Securities in accordance with the provisions of Section 1.6(d) hereof in
lieu of selling the Adjustment Securities to the Company by giving written
notice to the Company (the "MARKET SALE NOTICE"), within 10 business days
after receipt of the Repurchase Event Notice, that the Stockholder has
elected to sell the Adjustment Securities pursuant to the provisions of
Section 1.6(d) hereof. For purposes of this Agreement, the "INITIAL
PURCHASE PRICE" means the price paid by the Stockholder (or its Affiliate)
for the Adjustment Securities, increased at the rate of 10% per annum,
compounded annually, from the date of the acquisition thereof through the
date of the Repurchase Event Notice; it being understood that to the extent
the Adjustment Securities include Equity Securities acquired by the
Stockholder (or its Affiliate) on or before the Distribution Date (as
defined in the Distribution Agreement), then (i) the Initial Purchase Price
therefor shall be equal to $344 million divided by the number of shares of
Equity Securities beneficially owned by the Shareholders immediately after
the Distribution (subject to adjustment to reflect (1) the 10% annual
compound rate of increase, (2) any of the events contemplated by Section
1.4(b) hereof, and (3) any stock splits, reverse stock splits, stock
dividends or other similar events), and (ii) the date of acquisition
thereof shall be the Distribution Date.
(d) If a Stockholder delivers the Market Sale Notice to the
Company in the time required by Section 1.6(c) hereof (the "ELECTING
STOCKHOLDER"), then the Electing Stockholder may sell its Adjustment
Securities to any one or more third parties not Affiliates of the
Shareholders; provided, that such sale of Adjustment Securities shall be
completed on or before the date that is the later of (i) the six-month
anniversary of the Repurchase Event Notice (the "FIRST DATE"), (ii) the
earliest date after the First Date on which Adjustment Securities can be
sold by the Electing Stockholder without liability resulting therefrom
under Section 16(b) of the Securities Exchange Act of 1934, as amended, and
the rules and regulations promulgated thereunder (the "SECTION 16(B)
DATE"), (iii) provided the Electing Stockholder has requested in the Market
Sale Notice the registration of the Adjustment Securities pursuant to
Article III hereof, the six-month anniversary of the effective date of a
registration statement filed with respect to the Adjustment Securities
under the Securities Act of 1933, as amended, which registration statement
has not after it becomes effective been interfered with by any stop order,
injunction or other order or requirement of the SEC or other governmental
agency or court for any reason other than a misrepresentation or omission
by the Electing Stockholder and, as a result thereof, the Adjustment
Securities cannot be distributed in accordance with the plan of
distribution, and (iv) provided clause (iii) of this Section 1.6(d) is not
applicable, the earliest date after the Repurchase Event Notice which is
the end of a period during which the Adjustment Securities could have been
sold pursuant to Rule 144 (or any similar provision then in force).
(e) The Electing Stockholder may demand that Adjustment
Securities be registered under the Securities Act pursuant to Article III
hereof; provided, that a registration of Adjustment Securities pursuant to
Article III hereof shall not be (i) subject to the limitation set forth in
Section 3.1(a) hereof on the minimum number of shares that can be
registered pursuant to Article III, and (ii) counted as one of the five
requests for registration permitted under Section 3.1(a) hereof.
(f) Except to the extent otherwise expressly provided in
this Section 1.6, the provisions of this Agreement shall not in any manner
limit or otherwise restrict the rights of an Electing Stockholder to
transfer Adjustment Securities
1.7. Special Nominating and Voting Rights.
(a) Notwithstanding anything to the contrary contained in
this Agreement, from and after the seventh anniversary of the date hereof,
the Shareholders shall have the right to nominate for election to the Board
of Directors a Proportionate Number (as defined below) of nominees
("STOCKHOLDER NOMINEES") and to vote their Equity Securities in favor of
their election.
(b) With respect to each meeting of shareholders of the
Company at which directors are to be elected which occurs on or after the
seventh anniversary of the date hereof, the Company will give the
Shareholders 30 days' prior written notice of the filing with the SEC of
proxy materials with respect thereto. On or before the 10th day following
receipt of such notice the Shareholders shall notify the Company if they
intend to propose Stockholder Nominees and within 10 days thereafter shall
supply the Company with the Special Nominee Information (as defined below).
The Company will include the Special Nominee Information in its proxy
materials with respect to such meeting, and the Shareholders will not
engage in any action otherwise prohibited by Section 1.1(ii) or (v) with
respect to the Stockholder Nominees or otherwise.
(c) In the event that, following any election of Stockholder
Nominees to the Board of Directors and before the next meeting of
shareholders at which directors are elected, the size of the Board of
Directors is increased so as to increase the Proportionate Number of
directors, the Company will use its best efforts to create additional seats
on the Board of Directors, offer the Shareholders the right to propose
additional Stockholder Nominees to fill such vacancies and use its best
efforts to cause such vacancies to be filled by any such nominees so that
the Stockholder Nominees would constitute a Proportionate Number of the
enlarged Board.
(d) The Company will not propose, and will use its best
efforts to prevent, the adoption of any amendment of any of the charter
documents of the Company that would adversely affect the rights of the
Shareholders under this Agreement.
(e) As used in this Section 1.7, the following terms are
used as defined below:
"PROPORTIONATE NUMBER" means a number of directors or
nominees, as the case may be, rounded up to the nearest whole number, that
would represent a proportion of the entire Board of Directors (after giving
effect to the election of Directors or enlargement of the Board in
question) equal to the proportion of the Total Voting Power of the Company
that is represented by the Voting Power of the Equity Securities
beneficially owned by the Shareholders, provided, that if the Proportionate
Number (as calculated above) would otherwise be reduced if the total number
of members of the Board of Directors were reduced by a single member, the
Proportionate Number will be calculated by rounding down, rather than
rounding up, to the nearest whole number.
"SPECIAL NOMINEE INFORMATION" means the information as to
each nominee for director required to be included in the Company's proxy
materials under the Exchange Act and the rules and regulations thereunder,
and may include a brief statement as to the qualifications of the
Stockholder Nominees and the Shareholders' reasons for seeking their
election to the board, but shall not include any invidious comparisons
between the Stockholder Nominees and other nominees for director or any
criticism of the other nominees for director or of incumbent management,
its policies or the Company's performance.
II.
TRANSFER RESTRICTIONS
2.1. Certain Transactions. Notwithstanding anything
contained in this Agreement to the contrary, a Stockholder may without
restriction:
(i) assign, pledge, mortgage, hypothecate, or
otherwise encumber or transfer all or any of its Equity Securities
in connection with any bona fide financing arrangement entered into
by such person or otherwise in connection with any indebtedness
owed by such Stockholder; provided that in the event that the
Stockholder in question defaults, the creditor's rights and
obligations with respect to the voting and transfer of such Equity
Securities and the registration thereof shall be the same as the
Stockholder in question had under the provisions of this Agreement
and the creditor in question shall be deemed to be a Stockholder
under this Agreement for such purposes;
(ii) transfer any Equity Securities to another
Stockholder or any subsidiary or other Affiliate thereof (provided
that such subsidiary or Affiliate agrees to be bound to the
provisions of this Agreement, upon which such subsidiary or
Affiliate shall be entitled to all rights and benefits, and shall
be subject to all obligations, of a Stockholder under this
Agreement);
(iii) transfer any Equity Securities pursuant to any
registered public offering in connection with the provisions of
Article III hereof or pursuant to the provisions of Rule 144 (or
any similar provision then in force) under the Securities Act
provided that such transfer under Rule 144 or any similar provision
meets the volume restrictions set forth in Rule 144 as in effect on
the date hereof; or
(iv) transfer any Equity Securities pursuant to any
merger, consolidation, corporate reorganization, restructuring or
any other similar transaction affecting the Company or pursuant to
any involuntary transfer.
2.2. Rights Pursuant to a Tender Offer. Each Stockholder
(any such Stockholder shall, for purposes of this Section 2.2, be referred
to as a "TENDERING STOCKHOLDER") shall have the right to sell or exchange
all its Equity Securities pursuant to a tender or exchange offer for the
Equity Securities (an "OFFER"). However, during the Term, prior to such
sale or exchange, the Tendering Stockholder shall give the Company the
opportunity to purchase such Equity Securities in the following manner:
(i) The Tendering Stockholder shall give notice (the
"TENDER NOTICE") to the Company in writing of its intention to sell
or exchange Equity Securities in response to an Offer no later than
three calendar days prior to the latest time (including any
extensions) by which Equity Securities must be tendered in order to
be accepted pursuant to such Offer, specifying the amount of Equity
Securities proposed to be tendered by the Tendering Stockholder
(the "TENDERED Shares") and the purchase price per share specified
in the Offer at the time of the Tender Notice.
(ii) If the Tender Notice is given, the Company shall
have the right to purchase all, but not less than all, of the
Tendered Shares exercisable by giving written notice (an "EXERCISE
NOTICE") to the Tendering Stockholder at least two calendar days
prior to the latest time after delivery of the Tender Notice by
which Equity Securities must be tendered in order to be accepted
pursuant to the Offer (including any extensions thereof) and
depositing in any escrow or similar arrangement reasonably
acceptable to the Tendering Stockholder, a sum in cash sufficient
to purchase all Tendered Shares at the price then being offered in
the Offer, without regard to any provision thereof with respect to
proration or conditions to the offeror's obligation to purchase.
The delivery by the Company of an Exercise Notice and deposit of
funds as provided above will, except as provided below, constitute
an irrevocable agreement by the Company to purchase, and the
Tendering Stockholder to sell, the Tendered Shares in accordance
with the terms of this Section 2.2, whether or not the Offer or any
other tender or exchange offer (a "COMPETING TENDER OFFER") for
Equity Securities that was outstanding during the Offer is
consummated.
(iii) The purchase price to be paid by the Company
for any Equity Securities purchased by it pursuant to this Section
2.2 shall be the highest price offered or paid in the Offer or in
any Competing Tender Offer. For purposes hereof, the price offered
or paid in a tender or exchange offer for Voting Shares shall be
deemed to be the price offered or paid pursuant thereto, without
regard to any provisions thereof with respect to proration or
conditions to the offeror's obligation to purchase. If the purchase
price per share specified in the Offer includes any property other
than cash (the "OFFER NONCASH PROPERTY"), the purchase price per
share at which the Company shall be entitled to purchase all, but
not less than all, of the Equity Securities specified in the Tender
Notice shall be (y) the amount of cash per share, if any, specified
in such Offer (the "CASH PORTION"), plus (z) an amount of cash per
share equal to the value of the Offer Noncash Property per share
(the "CASH VALUE OF OFFER NONCASH PROPERTY"), as determined in good
faith by the mutual agreement of the parties hereto, or if the
parties cannot agree, by an independent, nationally recognized
investment banking firm selected by the Tendering Shareholders and
reasonably acceptable to the Company. If the Company exercises its
right of first refusal by giving an Exercise Notice, the closing of
the purchase of the Equity Securities with respect to such right
(the "CLOSING") shall take place at 3:00 p.m., local time (or, if
earlier, two hours before the latest time by which Equity
Securities must be tendered in order to be accepted pursuant to the
Offer), on the last day on which Equity Securities must be tendered
in order to be accepted pursuant to the Offer (including any
extensions thereof) (the "LAST TENDER DATE"), and the Company shall
pay the purchase price for the Equity Securities specified above.
The Tendering Stockholder shall be entitled to rescind its Tender
Notice at any time prior to the Last Tender Date by notice in
writing to the Company; provided that if on or before the Last
Tender Date, the Company publicly announces that the Company has
approved, proposed or entered into an agreement with respect to
(either individually or together with any other persons) a
recapitalization, reorganization or business combination with
respect to the Company or all or substantially all of its assets,
or a self-tender offer, the Tendering Stockholder shall be entitled
to rescind its Tender Notice by notice in writing to the Company at
any time prior to the Closing on the Last Tender Date. If the
Tendering Stockholder rescinds its Tender Notice pursuant to the
immediately preceding sentence, the Company's Exercise Notice with
respect to such Offer shall be deemed to be immediately rescinded
and the Tendering Stockholder's disposition of its Equity
Securities in response to the Offer with respect to which the
Tender Notice is rescinded or any other Offer shall again be
subject to all of the provisions of this Section 2.2.
(iv) If the Company does not exercise its right of
first refusal set forth in this Section 2.2 within the time
specified for such exercise by giving an Exercise Notice, then the
Tendering Stockholder shall be free to accept, for all its Equity
Securities, the Offer with respect to which the Tender Notice was
given or any Competing Tender Offer (including any increases and
extensions thereof).
III.
REGISTRATION RIGHTS
3.1. Registration Upon Request.
(a) At any time commencing on the date hereof and continuing
thereafter, each Stockholder (any such Stockholder, whether registering
securities pursuant to this Section 3.1 or Section 3.2, shall be referred
to as a "REGISTERING STOCKHOLDER") shall have the right to make written
demand upon the Company, on not more than five separate occasions (subject
to the provisions of this Section 3.1), to register under the Securities
Act, any common stock or other securities of the Company held by it (the
securities subject to such demand hereunder or subject to the provisions of
Section 3.2 being referred to in each case as the "SUBJECT SECURITIES"),
and the Company shall use its best efforts to cause such securities to be
registered under the Securities Act as soon as reasonably practicable so as
to permit the sale thereof promptly; provided that each such demand shall
cover at least the lesser of (i) 10 million shares of Common Stock or
Preferred Stock convertible into 10 million shares of Common Stock and (ii)
shares having a market value of $150 million shares of Common Stock
(subject to adjustment for stock splits, reverse stock splits, stock
dividends and similar events after the date hereof). In connection
therewith, the Company shall prepare, and as soon as reasonably practicable
but in no event later than 90 days of the receipt of the request, file, on
Form S-3 if permitted or otherwise on the appropriate form, a registration
statement under the Securities Act to effect such registration. Such
registration shall be effected in accordance with the intended method or
methods of disposition specified by the Registering Shareholders
(including, but not limited to, an offering on a delayed or continuous
basis pursuant to Rule 415 (or any successor rule to similar effect)
promulgated under the Securities Act). Each Registering Stockholder agrees
to provide all such information and materials and to take all such action
as may be reasonably required in order to permit the Company to comply with
all applicable requirements of the Securities Act and the SEC and to obtain
any desired acceleration of the effective date of such registration
statement. If the offering to be registered is to be underwritten, the
managing underwriter shall be selected by the Registering Shareholders and
shall be reasonably satisfactory to the Company. Notwithstanding the
foregoing, the Company (i) shall not be obligated to prepare or file more
than one registration statement other than for purposes of a stock option
or other employee benefit or similar plan during any twelve-month period,
(ii) shall be entitled to postpone for a reasonable period of time (but in
no event later than 60 days), the filing of any registration statement
otherwise required to be prepared and filed by the Company if (A) the
Company is, at such time, conducting or about to conduct an underwritten
public offering of securities and is advised by its managing underwriter or
underwriters in writing (with a copy to the Registering Shareholders), that
such offering would, in its or their opinion, be materially adversely
affected by the registration so requested, or (B) the Company determines in
its reasonable judgment and in good faith that the registration and
distribution of the Subject Securities would interfere with any announced
or imminent material financing, acquisition, disposition, corporate
reorganization or other material transaction of a similar type involving
the Company. In the event of such postponement, the Registering
Shareholders shall have the right to withdraw the request for registration
by giving written notice to the Company within 20 days after receipt of the
notice of postponement (and, in the event of such withdrawal, such request
shall not be counted for purposes of determining the number of
registrations to which the Registering Shareholders are entitled pursuant
to this Section 3.1).
(b) The Company shall not grant to any other holder of its
securities, whether currently outstanding or issued in the future, any
incidental or piggyback registration rights with respect to any
registration statement filed pursuant to a demand registration under this
Section 3.1 and without the prior consent of the Registering Shareholders,
the Company will not itself, and will not permit any other holder of its
securities to, participate in any offering made pursuant to a demand
registration under this Section 3.1. The Company may grant to other holders
of its securities incidental or piggyback registration rights on a primary
offering by the Company which are no more favorable to such holders than
the provisions set forth in Section 3.2 are to the Shareholders. If the
Registering Shareholders consents to the inclusion of offers and sales of
any other securities in a registration pursuant to this Section 3.1 and the
underwriter(s) retained in connection with such registration subsequently
advise the Registering Shareholders that such offering would be adversely
affected by the inclusion of such other securities, the Registering
Shareholders may in their sole discretion exclude all or some of such
securities from such registration.
(c) Any registration requested by any Registering
Stockholder pursuant to this Section 3.1 shall not be deemed to have been
effected (and, therefore, not requested for purposes of this Section 3.1),
(i) unless it has become effective, (ii) if after it has become effective
such registration is interfered with by any stop order, injunction or other
order or requirement of the SEC or other governmental agency or court for
any reason other than a misrepresentation or an omission by the Registering
Shareholders and, as a result thereof, the Subject Securities requested to
be registered cannot be completely distributed in accordance with the plan
of distribution set forth in the related registration statement or (iii) if
the closing pursuant to the purchase agreement or underwriting agreement
entered into in connection with such registration does not occur. Any
registration effected pursuant to Section 3.2 shall not be deemed to have
been requested by a Registering Stockholder for purposes of this Section
3.1.
3.2. Incidental Registration Rights. If the Company proposes
to register any of its Equity Securities under the Securities Act for its
own account (other than (i) pursuant to Section 3.1 hereof, (ii) securities
to be issued pursuant to a stock option or other employee benefit or
similar plan, and (iii) securities proposed to be issued in exchange for
securities or assets of, or in connection with a merger or consolidation
with, another corporation), the Company shall, as promptly as practicable,
give written notice to the Registering Shareholders of the Company's
intention to effect such registration. If, within 15 days after receipt of
such notice, a Registering Stockholder submits a written request to the
Company specifying the amount of Equity Securities that it proposes to sell
or otherwise dispose of in accordance with this Section 3.2, the Company
shall use its best efforts to include the securities specified in the
Registering Stockholder's request in such registration. If the offering
pursuant to such registration statement is to be made by or through
underwriters, the managing underwriters shall be chosen by the Company and
shall be reasonably satisfactory to the Registering Shareholders and the
Company, and the Registering Shareholders and such underwriter shall
execute an underwriting agreement in customary form. If the managing
underwriter reasonably determines in good faith and advises the Registering
Shareholders in writing that the inclusion in the registration statement of
all the Equity Securities proposed to be included would interfere with the
successful marketing of the securities proposed to be registered, then the
Company and the Registering Shareholders shall negotiate in good faith to
agree upon an equitable adjustment in the number or amount of securities of
each to be included in such underwriting (provided that in the event that
the Company and the Registering Shareholders are unable to agree upon an
equitable adjustment in the number or amount of securities of each to be
included in such underwriting, then the number of securities which the
Company and the Registering Shareholders propose to register shall be
reduced pro rata (based upon the respective market values of each party's
respective share of the total number of securities proposed to be
registered). No registration effected under this Section 3.2 shall relieve
the Company of its obligation to effect any registration upon request under
Section 3.1. If the Registering Shareholders are permitted to participate
in a proposed offering pursuant to this Section 3.2, the Company thereafter
may determine either not to file a registration statement relating thereto,
or to withdraw such registration statement, or otherwise not to consummate
such offering, without any liability hereunder. Any underwriters
participating in a distribution of the Subject Securities pursuant to
Sections 3.1 and 3.2 hereof shall use all reasonable efforts to effect as
wide a distribution as is reasonably practicable, and in no event shall any
sale of Subject Securities be made knowingly to any person (including its
Affiliates and any group in which that person or its Affiliates shall be a
member, or the Registering Shareholders or the underwriters know of the
existence of such a group or Affiliate) that, immediately prior to giving
effect to any such sale, beneficially owned Equity Securities representing
five percent (5%) or more of the Total Voting Power. The Registering
Shareholders and the Company shall use all reasonable efforts to secure the
agreement of the underwriters, in connection with any underwritten offering
of its Equity Securities, to comply with the foregoing.
3.3. Registration Mechanics. (a) In connection with any
offering of Subject Securities registered pursuant to Section 3.1 or 3.2
herein, the Company shall (i) furnish to the Registering Shareholders such
number of copies of any prospectus (including preliminary and summary
prospectuses) and conformed copies of the registration statement (including
amendments or supplements thereto and, in each case, all exhibits) and such
other documents as any Registering Stockholder may reasonably request;
(ii)(A) use its best efforts to register or qualify the Subject Securities
covered by such registration statement under such blue sky or other state
securities laws for offer and sale as the Registering Shareholders shall
reasonably request and (B) keep such registration or qualification in
effect for so long as the registration statement remains in effect;
provided that the Company shall not be obligated to qualify to do business
as a foreign corporation under the laws of any jurisdiction in which it
shall not then be qualified or to file any general consent to service of
process in any jurisdiction in which such a consent has not been previously
filed or subject itself to taxation in any jurisdiction wherein it would
not otherwise be subject to tax but for the requirements of this Section
3.3; (iii) use its best efforts to cause all Subject Securities covered by
such registration statement to be registered with or approved by such other
federal or state government agencies or authorities as may be necessary, in
the opinion of counsel to the Registering Shareholders, to enable the
Registering Shareholders to consummate the disposition of such Subject
Securities; (iv) notify the Registering Shareholders any time when a
prospectus relating thereto is required to be delivered under the
Securities Act upon discovery that, or upon the happening of any event as a
result of which, the prospectus included in such registration statement, as
then in effect, includes an untrue statement of a material fact or omits to
state any material fact required to be stated therein or necessary to make
the statements therein not misleading, in the light of the circumstances
under which they were made, and (subject to the good faith determination of
the Company's Board of Directors as to whether to permit sales under such
registration statement), at the request of any Registering Stockholder
promptly prepare and furnish to it a reasonable number of copies of a
supplement to or an amendment of such prospectus as may be necessary so
that, as thereafter delivered to the purchasers of such securities, such
prospectus shall not include an untrue statement of a material fact or omit
to state a material fact required to be stated therein or necessary to make
the statements therein not misleading, in light of the circumstances under
which they were made; (v) otherwise use its best efforts to comply with all
applicable rules and regulations of the SEC; (vi) use its best efforts to
list the Subject Securities covered by such registration statement on the
New York Stock Exchange or on any other Exchange on which the Subject
Securities are then listed, if required by the rules of any such Exchange;
(vii) use its best efforts to obtain a "cold comfort" letter from the
independent public accountants for the Company in customary form and
covering matters of the type customarily covered by such letters as may be
reasonably requested by the Registering Shareholders, in the event of a
registration effected pursuant to Section 3.1 hereof; (viii) execute and
deliver all instruments and documents (including in an underwritten
offering an underwriting agreement in customary form) and take such other
actions and obtain such certificates and opinions as the Registering
Shareholders reasonably request in order to effect an underwritten public
offering; and (ix) before filing any registration statement or any
amendment or supplement thereto, and as far in advance as is reasonably
practicable, furnish to each Registering Stockholder and its counsel copies
of such documents. In connection with any offering of Subject Securities
registered pursuant to Section 3.1 or 3.2, the Company shall (x) furnish to
the underwriter, if any, unlegended certificates representing ownership of
the Subject Securities being sold in such denominations as requested and
(y) instruct any transfer agent and registrar of the Subject Securities to
release any stop transfer orders with respect to such Subject Securities.
Upon any registration becoming effective pursuant to Section 3.1, the
Company shall use its best efforts to keep such registration statement
current for a period of 60 days (or 90 days, if the Company is eligible to
use a Form S-3, or successor form) or such shorter period as shall be
necessary to effect the distribution of the Subject Securities.
(a) Before filing with the SEC any registration statement
referred to herein or any amendments or supplements thereto, the Company
shall furnish to the Registering Shareholders or their respective counsel
copies of all such documents proposed to be filed, in order to give the
Registering Shareholders or their respective counsel sufficient time to
review such documents, and such documents may thereafter be filed subject
to any timely and reasonable comments of the Registering Shareholders or
their respective counsel. The Company shall (i) deliver promptly to the
Registering Shareholders or their respective counsel copies of all written
communications between the Company and the SEC relating to the registration
statement, and (ii) advise the Registering Shareholders or their respective
counsel promptly of, and provide the Registering Shareholders or their
respective counsel with the opportunity to participate in (to the extent
reasonably practicable), all telephonic and other non-written
communications between the Company and the SEC relating to such
registration statement. The Company shall respond promptly to any comments
from the SEC with respect thereto, after consultation with the Registering
Shareholders or their respective counsel, and shall take such other actions
as shall be reasonably required in order to have each such registration
statement declared effective under the Securities Act as soon as reasonably
practicable following the date hereof.
(b) Each Registering Stockholder agrees that upon receipt of
any notice from the Company of the happening of any event of the kind
described in subdivision (iv) of this Section 3.3, it will forthwith
discontinue its disposition of Subject Securities pursuant to the
registration statement relating to such Subject Securities until its
receipt of the copies of the supplemented or amended prospectus
contemplated by subdivision (iv) of this Section 3.3 and, if so directed by
the Company, will deliver to the Company all copies (other than permanent
file copies) then in its possession of the prospectus relating to such
Subject Securities current at the time of receipt of such notice. If any
Registering Stockholder's disposition of Subject Securities is discontinued
pursuant to the foregoing sentence unless the Company thereafter extends
the effectiveness of the registration statement to permit dispositions of
Subject Securities by the Registering Stockholder for an aggregate of 60
days (or 90 days, if the Company is eligible to use a Form S-3, or
successor form), whether or not consecutive, the registration statement
shall not be counted for purposes of determining the number of
registrations to which the Registering Shareholders are entitled pursuant
to Section 3.1.
3.4. Expenses. The Registering Shareholders shall pay all
agent fees and commissions and underwriting discounts and commissions
related to Subject Securities being sold by the Registering Shareholders
and the fees and disbursements of its counsel and accountants and the
Company to the extent permitted by applicable law shall pay all fees and
disbursements of its counsel and accountants in connection with any
registration pursuant to this Article III. All other fees and expenses in
connection with any registration statement (including, without limitation,
all registration and filing fees, all printing costs, all fees and expenses
of complying with securities or blue sky laws) shall to the extent
permitted by applicable law (i) in the case of a registration pursuant to
Section 3.1, be borne equally by the Registering Shareholders and the
Company and (ii) in the case of a registration pursuant to Section 3.2, be
shared pro rata based upon the respective market values of the securities
to be sold by the Company, the Registering Shareholders and any other
holders participating in such offering; provided that the Registering
Shareholders shall not be obligated to pay any expenses relating to work
that would otherwise be incurred by the Company including, but to limited
to, the preparation and filing of periodic reports with the SEC.
3.5. Indemnification and Contribution. (a) In the case of
any offering registered pursuant to this Article III, the Company agrees to
indemnify and hold each Registering Stockholder, each underwriter, if any,
of the Subject Securities under such registration and each person who
controls any of the foregoing within the meaning of Section 15 of the
Securities Act, and any officer, employee or partner of the foregoing,
harmless against any and all losses, claims, damages, or liabilities
(including reasonable legal fees and other reasonable expenses incurred in
the investigation and defense thereof) to which they or any of them may
become subject under the Securities Act or otherwise (collectively
"LOSSES"), insofar as any such Losses shall arise out of or shall be based
upon (i) any untrue statement or alleged untrue statement of a material
fact contained in the registration statement relating to the sale of such
Subject Securities (as amended if the Company shall have filed with the SEC
any amendment thereof), or the omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make
the statements therein not misleading or (ii) any untrue statement or
alleged untrue statement of a material fact contained in the prospectus
relating to the sale of such Subject Securities (as amended or supplemented
if the Company shall have filed with the SEC any amendment thereof or
supplement thereto), or the omission or alleged omission to state therein 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 the indemnification contained in this Section 3.5 shall not apply to
such Losses which shall arise primarily out of or shall be based primarily
upon any such untrue statement or alleged untrue statement, or any such
omission or alleged omission, which shall have been made in reliance upon
and in conformity with information furnished in writing to the Company by
the Registering Shareholders or any such underwriter, as the case may be,
specifically for use in connection with the preparation of the registration
statement or prospectus contained in the registration statement or any such
amendment thereof or supplement therein.
(a) In the case of each offering registered pursuant to this
Article III, the Registering Shareholders and each underwriter, if any,
participating therein shall agree, substantially in the same manner and to
the same extent as set forth in the preceding paragraph, severally to
indemnify and hold harmless the Company and each person, if any, who
controls the Company within the meaning of Section 15 of the Securities
Act, and the directors and executive officers of the Company, with respect
to any statement in or omission from such registration statement or
prospectus contained in such registration statement (as amended or as
supplemented, if amended or supplemented as aforesaid) if such statement or
omission shall have been made in reliance upon and in conformity with
information furnished in writing to the Company by the Registering
Shareholders or such underwriter, as the case may be, specifically for use
in connection with the preparation of such registration statement or
prospectus contained in such registration statement or any such amendment
thereof or supplement thereto.
(b) Each party indemnified under this Section 3.5 shall,
promptly after receipt of notice of the commencement of any claim ("CLAIM")
against such indemnified party in respect of which indemnity may be sought
hereunder, notify the indemnifying party in writing of the commencement
thereof. The failure of any indemnified party to so notify an indemnifying
party shall not relieve the indemnifying party from any liability in
respect of such Claim which it may have to such indemnified party on
account of the indemnity contained in this Section 3.5, unless (and only in
the event) the indemnifying party was materially prejudiced by such
failure, and in no event shall such failure relieve the indemnifying party
from any other liability which it may have to such indemnified party. In
case any Claim in respect of which indemnification may be sought hereunder
shall be brought against any indemnified party and it shall notify an
indemnifying party of the commencement thereof, the indemnifying party
shall be entitled to participate therein and, to the extent that it may
desire, jointly with any other indemnifying party similarly notified, to
assume the defense thereof through counsel reasonably satisfactory to the
indemnified party by notifying the indemnified party in writing of such
election within 10 days after receipt of the indemnified party's initial
notice of the Claim, and after such notice from the indemnifying party to
such indemnified party of its election so to assume the defense thereof,
the indemnifying party shall not be liable to such indemnified party under
this Section 3.5 for any legal or other expenses subsequently incurred by
such indemnified party in connection with the defense thereof, other than
reasonable costs of investigation (unless such indemnified party reasonably
objects to such assumption on the grounds that there may be defenses
available to it which are different from or in addition to those available
to such indemnifying party in which event the indemnified party shall be
reimbursed by the indemnifying party for the reasonable expenses incurred
in connection with retaining separate legal counsel). If the indemnifying
party undertakes to defend against such Claim within such 10-day period,
the indemnifying party shall control the investigation, defense and
settlement thereof; provided that (i) the indemnifying party shall use its
reasonable efforts to defend and protect the interests of the indemnified
party with respect to such Claim, (ii) the indemnified party, prior to or
during the period in which the indemnifying party assumes control of such
matter, may take such reasonable actions as the indemnified party deems
necessary to preserve any and all rights with respect to such matter,
without such actions being construed as a waiver of the indemnified party's
rights to defense and indemnification pursuant to this Agreement, and (iii)
the indemnifying party shall not, without the prior written consent of the
indemnified party, consent to any settlement which (A) imposes any
Liabilities on the indemnified party (other than those Liabilities which
the indemnifying party agrees to promptly pay or discharge), and (B) with
respect to any non-monetary provision of such settlement, would be likely,
in the indemnified party's reasonable judgment, to have an adverse effect
on the business operations, assets, properties or prospects of any
Stockholder (in the event that a Registering Stockholder or any of its
Affiliates is the indemnified party), or the Company (in the event that the
Company is an indemnified party), or such indemnified party. If the
indemnifying party does not undertake within such 10-day period to defend
against such Claim, then the indemnifying party shall have the right to
participate in any such defense at its sole cost and expense, but the
indemnified party shall control the investigation, defense and settlement
thereof (provided that the indemnified party may not settle any such Claim
without obtaining the prior written consent of the indemnifying party
(which consent shall not be unreasonably withheld by the indemnifying
party; provided that in the event that the indemnifying party is in
material breach at such time of the provisions of this Section 3.5, then
the indemnified party shall not be obligated to obtain such prior written
consent of the indemnifying party) at the reasonable cost and expense of
the indemnifying party (which shall be paid by the indemnifying party
promptly upon presentation by the indemnified party of invoices or other
documentation evidencing the amounts to be indemnified). In addition to the
foregoing, no indemnifying party shall, without the prior written consent
of the indemnified party, effect any settlement of any pending or
threatened proceeding in respect of which the indemnified party could have
been a party and indemnity could have been sought hereunder by such
indemnified party, unless such settlement includes an unconditional release
of such indemnified party from all liability arising out of such claim or
proceeding.
(c) If the indemnification provided for in this Section 3.5
is unavailable to an indemnified party or is insufficient to hold such
indemnified party harmless from any Losses in respect of which this Section
3.5 would otherwise apply by its terms (other than by reason of exceptions
provided herein), then each applicable indemnifying party, in lieu of
indemnifying such indemnified party, shall have a joint and several
obligation to contribute to the amount paid or payable by such indemnified
party as a result of such Losses, in such proportion as is appropriate to
reflect the relative benefits received by and fault of the indemnifying
party, on the one hand, and such indemnified party, on the other hand, in
connection with the offering to which such contribution relates as well as
any other relevant equitable considerations. The relative benefit shall be
determined by reference to, among other things, the amount of proceeds
received by each party from the offering to which such contribution
relates. The relative fault shall be determined by reference to, among
other things, each party's relative knowledge and access to information
concerning the matter with respect to which the claim was asserted, and the
opportunity to correct and prevent any statement or omission. The amount
paid or payable by a party as a result of any Losses shall be deemed to
include any legal or other fees or expenses incurred by such party in
connection with any investigation or proceeding, to the extent such party
would have been indemnified for such expenses if the indemnification
provided for in this Section 3.5 was available to such party.
(d) The parties hereto agree that it would not be just and
equitable if contribution pursuant to this Section 3.5 were determined by
pro rata allocation or by any other method of allocation that does not take
account of the equitable considerations referred to in the immediately
preceding paragraph. 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.
3.6. Rule 144. The Company covenants that it will file the
reports required to be filed by it under the Securities Act and the
Exchange Act and the rules and regulations adopted by the Commission
thereunder (or, if the Company is not required to file such reports, it
will, upon the request of any Stockholder, make publicly available other
information), and it will take such further action as any Stockholder may
reasonably request, all to the extent required from time to time to enable
such Stockholder to sell Subject Securities without registration under the
Securities Act within the limitation of the exemptions provided by (i) Rule
144 under the Securities Act, as such Rule may be amended from time to
time, or (ii) any similar rule or regulation hereafter adopted by the
Commission. Upon the request of any Stockholder, the Company will deliver
to such Stockholder a written statement as to whether it has complied with
such requirements.
3.7. Holdback Agreement. The Company agrees that it and its
Affiliates will not effect any sale, offer for sale, or grant any option to
purchase any shares of common stock (or securities convertible into or
exchangeable or exercisable for common stock) (collectively, "SALES")
during the 10-day period prior to, and the 90-day period (or such longer
period, not to exceed 120 days, as the managing underwriter(s) therefor
determines) beginning on the effective date of a registration statement
filed pursuant to Section 3.1 without the consent of such managing
underwriter(s). The Shareholders agree not to effect any Sales during the
10-day period prior to, and the 90-day period (or such longer period, not
to exceed 120 days, as the managing underwriter(s) therefor determines)
beginning on the effective date of a registration statement relating to a
primary offering (other than one described in clauses (i), (ii) or (iii) of
the first sentence of Section 3.2 hereof) without the consent of such
managing underwriter(s); provided that this sentence shall be of no force
and effect if the Company effects a Sale or files any registration
statement for the benefit of any other party during such 120-day period.
IV.
REPRESENTATIONS AND WARRANTIES
4.1. Representations and Warranties of the Company. The
Company hereby represents and warrants to each of the Shareholders as
follows:
(a) The execution, delivery and performance by the Company
of this Agreement and the consummation by the Company of the transactions
contemplated by this Agreement are within its corporate powers and have
been duly authorized by all necessary corporate action on its part. This
Agreement constitutes a legal, valid and binding agreement of the Company,
enforceable against the Company in accordance with its terms, (i) except as
limited by applicable bankruptcy, insolvency, reorganization, moratorium or
other similar laws now or hereafter in effect relating to or affecting
creditors' rights generally, including the effect of statutory and other
laws regarding fraudulent conveyances and preferential transfers, and (ii)
subject to the limitations imposed by general equitable principles
(regardless of whether such enforceability is considered in a proceeding at
law or in equity).
(b) The execution, delivery and performance of this
Agreement by the Company does not and will not contravene or conflict with
or constitute a default under the Company's Memorandum of Association or
Bye-laws or any of its material Contracts.
(c) Immediately after giving effect to both the
Restructuring and the Distribution (including, without limitation, after
giving effect to the distribution of shares of Spinco Common Stock to the
holders of common stock of Loral and the holders of options with respect to
common stock of Loral, who or which may be entitled to receive shares of
Spinco Common Stock pursuant to or in connection with the Distribution
Agreement, the Merger Agreement or otherwise), (i) the Company's authorized
capital stock shall consist of ________ shares of Spinco Common Stock and
________ shares of Preferred Stock, of which ________ shares of Spinco
Common Stock and ________ shares of Preferred Stock shall be issued and
outstanding, (ii) Loral will be the record and beneficial owner of _______
shares of Preferred Stock, all of which will be validly issued and fully
paid and nonassessable and all of which will be free of all Liens, (iii)
except for the shares of Spinco Common Stock and the shares of Preferred
Stock specified in clause (i) above, there will be no other Equity
Securities, and (iv) the Wing Shareholders will hold, in the aggregate, at
least twenty percent (20%) of the Total Voting Power.
V.
TERM
5.1. Term. The term (the "TERM") of this Agreement shall
commence on the date hereof and shall continue until the earlier of (x) the
date on which the Voting Power of the Equity Securities, on a fully diluted
basis, beneficially owned by Loral and its Affiliates shall represent less
than five percent (5%) of the Total Voting Power, (y) the tenth anniversary
of the date hereof, or (z) a Change of Control (as defined in Section
1.1(c) above). Upon expiration of the Term, the provisions of this
Agreement shall terminate, and be of no further force or effect,
automatically without any further action on the part of any parties hereto;
provided that the provisions of Articles III and VI shall continue without
regard to the term limitation set forth in this sentence; provided further
that no such termination shall relieve any party of any liability to the
other parties hereto, to the extent such liability is incurred prior to the
expiration of the Term.
VI.
MISCELLANEOUS
6.1. Certain Restrictions. The Company shall not take or
recommend to its Shareholders any action, including any amendment of its
Memorandum of Association, Bye-laws or stockholder rights plan, if any,
which would impose restrictions applicable to Loral and not to other
securityholders generally based upon the size of Loral' security holdings,
the business in which it is engaged or other considerations applicable to
it and not to securityholders generally. In addition, the Company shall not
take or recommend to its Shareholders any action, including any amendment
of its Certificate of Incorporation, By-laws or stockholder rights plan, if
any, which would likely adversely affect in any material respect, either
directly or indirectly, any of the rights or obligations of the
Shareholders under the provisions of this Agreement.
The Shareholders agree that the Company may adopt a
Shareholders rights plan similar to the Shareholders rights plan adopted by
Loral except that Loral (and its Affiliates and associates) shall not be
deemed to be an "ACQUIRING PERSON" unless Loral and its Affiliates become
the beneficial owner of 25% or more of the outstanding shares of common
stock of the Company.
6.2. Entire Agreement. This Agreement and the Restructuring
Agreement (including the schedules and exhibits and the agreements and
other documents referred to therein, including, without limitation, the Tax
Sharing Agreement and the Transition Services Agreements) constitutes the
entire agreement among the parties with respect to the subject matter
hereof and supersedes all other prior negotiations, commitments, agreements
and understandings, both written and oral, between the parties or any of
them with respect to the subject matter hereof.
6.3. Fees and Expenses. Except as otherwise provided in this
Agreement, all costs and expenses incurred by the Shareholders and the
Company in connection with consummating such party's obligations hereunder
or otherwise shall be paid by the party incurring such cost or expense.
6.4. Access to Information. During the Term, the Company
shall provide to each Stockholder reasonable access to the books and
records of the Company and its subsidiaries during the regular business
hours of the Company and such subsidiaries, following the Company's receipt
of a written notice from such Stockholder requesting such access; provided
that the Company shall not be required to provide any confidential
information if the Company reasonably determines that the providing of such
information would result in (x) a violation of applicable antitrust laws or
(y) create a substantial likelihood of a significant adverse effect on the
Company; provided, further, that the Stockholder shall keep confidential
any confidential information disclosed to it except as required by law,
service of process, interrogatories, or similar legal process, and except
for any such information which becomes publicly available through no fault
of the Stockholder.
6.5. Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND
INTERPRETED AND ENFORCED IN ACCORDANCE WITH THE SUBSTANTIVE LAWS OF THE
STATE OF NEW YORK WITHOUT GIVING EFFECT TO THE CHOICE OF LAW PRINCIPLES
THEREOF (EXCEPT IN THOSE CIRCUMSTANCES WHERE THE CORPORATE LAW OF THE
COMPANY'S JURISDICTION OF ORGANIZATION REQUIRES THE APPLICATION OF THE LAW
OF THE COMPANY'S JURISDICTION OF ORGANIZATION WITH RESPECT TO A PARTICULAR
MATTER).
6.6. Notices. All notices and other communications hereunder
shall be in writing and shall be deemed given upon (a) transmitter's
confirmation of a receipt of a facsimile transmission, (b) confirmed
delivery by a standard overnight carrier or when delivered by hand or (c)
the expiration of five Business Days after the day when mailed by certified
or registered mail, postage prepaid, addressed at the following addresses
(or at such other address for a party as shall be specified by like
notice):
(a) If to any of the Shareholders, to:
Loral Corporation
c/o Lockheed Martin Corporation
6801 Rockledge Drive
Bethesda, MD 20817
Telephone: (301) 897-6125
Telecopy No.: (301) 897-6333
Attention: General Counsel
and to:
Skadden, Arps, Slate, Meagher & Flom
919 Third Avenue
New York, New York 10022
Telephone: (212) 735-3000
Telecopy No.: (212) 735-2000
Attention: Peter Allan Atkins, Esq.
Lou R. Kling, Esq.
and to:
O'Melveny & Myers
153 E. 53rd Street
New York, New York 10022
Telephone: (212) 326-2000
Telecopy No.: (212) 326-2160
Attention: C. Douglas Kranwinkle, Esq.
Jeffrey J. Rosen, Esq.
If to the Company, to:
Loral Space & Communications Corporation
600 Third Avenue
New York, New York
Telephone: (212) 697-1105
Telecopy No.: (212) 602-9805
Attention: General Counsel
with a copy to:
Willkie Farr & Gallagher
153 E. 53rd Street
New York, New York 10022
Telephone: (212) 821-8000
Telecopy No.: (212) 821-8111
Attention: Robert B. Hodes, Esq.
Bruce R. Kraus, Esq.
In addition to providing any notice required to be given by
the Company pursuant to its Certificate of Incorporation in the manner
specified therein, the Company shall send to each Stockholder by telecopy
in accordance with this Section 6.6 a copy of each such notice.
6.7. Successors and Assigns; Reclassifications; No Third
Party Beneficiaries. This Agreement and all of the provisions hereof shall
be binding upon and inure to the benefit of the parties and their
respective successors and permitted assigns, but neither this Agreement nor
any of the rights, interests or obligations hereunder shall be assigned by
any party hereto (whether by operation of law or otherwise) without the
prior written consent of the other parties hereto (which consent may not be
unreasonably withheld), except that any party shall have the right, without
the consent of any other party hereto, to assign all or a portion of its
rights, interests and obligations hereunder to one or more direct or
indirect subsidiaries, but no such assignment of obligation shall relieve
the assigning party from its responsibility therefor. In the event of any
recapitalization or reclassification of any Equity Securities, or any
merger, consolidation or other transaction with like effect, the securities
issued in replacement or exchange for such Equity Securities shall be
deemed Equity Securities hereunder. This Agreement shall be binding upon
and inure solely to the benefit of each party hereto, and nothing in this
Agreement, express or implied, is intended to or shall confer upon any
other person any rights, benefits or remedies of any nature whatsoever
under or by reason of this Agreement; provided that the indemnified parties
referred to in Section 3.5 hereof are intended to be third party
beneficiaries of the provisions of Section 3.5 hereof, and shall have the
right to enforce such provisions as if they were parties hereto.
6.8. Counterparts. This Agreement may be executed in two or
more counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument.
6.9. Further Assurances. Each party hereto or person subject
hereto shall do and perform or cause to be done and performed all such
further acts and things and shall execute and deliver all such other
agreements, certificates, instruments and documents as any other party
hereto or person subject hereto may reasonably request in order to carry
out the intent and accomplish the purposes of this Agreement and the
consummation of the transactions contemplated hereby.
6.10. Interpretation. The descriptive 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. Unless
otherwise specified in this Agreement, all references in this Agreement to
"DAYS" shall be deemed to be references to calendar days.
6.11. Legal Enforceability. Any provision of this Agreement
which is prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without affecting the validity or enforceability of the
remaining provisions hereof. Any such prohibition or unenforceability in
any jurisdiction shall not invalidate or render unenforceable such
provision in any other jurisdiction. If any provision of this Agreement is
so broad as to be unenforceable, the provision shall be interpreted to be
only so broad as is enforceable.
6.12. Consent to Jurisdiction. Each of the parties hereto
irrevocably and unconditionally (a) agrees that all suits, actions or other
legal proceedings arising out of this Agreement or any of the transactions
contemplated hereby (a "SUIT") shall be brought and adjudicated solely in
the United States District Court for the District of Delaware, or, if such
court will not accept jurisdiction, in the Delaware Chancery Court or any
court of competent civil jurisdiction sitting in New Castle County,
Delaware, (b) submits to the non-exclusive jurisdiction of any such court
for the purpose of any such Suit and (c) waives and agrees not to assert by
way of motion, as a defense or otherwise in any such Suit, any claims that
it is not subject to the jurisdiction of the above courts, that such Suit
is brought in an inconvenient forum or that the venue of such Suit is
improper. Each of the parties hereto also irrevocably and unconditionally
consents to the service of any process, summons, pleadings, notices or
other papers in a manner permitted by the notice provisions of Section 6.6
hereof and agrees that any such form of service shall be effective in
connection with any such Suit; provided that nothing contained in this
Section 6.12 shall affect the right of any party to serve process,
pleadings, notices or other papers in any other manner permitted by
applicable Law.
6.13. Specific Performance. Each of the parties hereto
acknowledges and agrees that in the event of any breach of this Agreement,
each non-breaching party would be irreparably and immediately harmed and
could not be made whole by monetary damages. It is accordingly agreed that
the parties hereto (a) will waive, in any action for specific performance,
the defense of adequacy of a remedy at law and (b) shall be entitled, in
addition to any other remedy to which they may be entitled at law or in
equity, to compel specific performance of this Agreement in any action
instituted in any court referred to in Section 6.12 hereof.
IN WITNESS WHEREOF, each of the parties has caused this
Shareholders Agreement to be executed on its behalf by its officers
thereunto duly authorized, all as of the day and year first above written.
LORAL CORPORATION
By:______________________________
Name:
Title:
LORAL SPACE & COMMUNICATIONS
LTD.
By:______________________________
Name:
Title:
EXCHANGE AGREEMENT
EXCHANGE AGREEMENT, dated as of April 22, 1996 (the
"AGREEMENT"), by and among Loral Space & Communications Ltd., a Bermuda
company which is the successor-in-interest to Loral Space &
Communications, Inc., a Delaware corporation ("SPACECOM"), Lockheed Martin
Corporation, a Maryland corporation ("LMC"), and Loral Corporation, a New
York corporation ("LORAL").
R E C I T A L S:
WHEREAS, each of Loral, LMC, and LAC Acquisition Corporation, a
New York corporation ("LAC"), are parties to that certain Agreement and
Plan of Merger, dated as of January 7, 1996, as amended (the "MERGER
AGREEMENT");
WHEREAS, Loral, LMC, SpaceCom and certain affiliates of
SpaceCom are parties to the Restructuring, Financing and Distribution
Agreement dated as of January 6, 1996, as amended (the "DISTRIBUTION
AGREEMENT");
WHEREAS, concurrently with the consummation of the Distribution
(as defined in the Distribution Agreement), Loral and SpaceCom will enter
into the Stockholders Agreement (as defined in the Distribution Agreement;
for purposes of this Agreement, the "SPACECOM STOCKHOLDERS AGREEMENT");
WHEREAS, immediately following the Distribution, Loral will own
all of the issued and outstanding shares of Series A Non-Voting Convertible
Preferred Stock of SpaceCom (the "SPACECOM PREFERRED SHARES"), which,
subject to certain conditions set forth in the Certificate of Designation
of the SpaceCom Preferred Shares and the SpaceCom Stockholders Agreement,
are convertible into shares of SpaceCom common stock, $.01 par value per
share (the "SPACECOM COMMON STOCK"; collectively, the SpaceCom Preferred
Shares and the SpaceCom Common Stock are the "SPACECOM SECURITIES");
WHEREAS, immediately following the Distribution, SpaceCom will
own all of the issued and outstanding common stock, $.01 par value per
share (the "SS/L BERMUDA COMMON STOCK"), of SS/L (Bermuda) Ltd., a Bermuda
company ("SS/L BERMUDA");
WHEREAS, immediately following the Distribution all of the
issued and outstanding shares of Series S Preferred Stock (as defined
below) of SS/L Bermuda will be owned by Lehman Brothers Capital Partners,
II, L.P., Lehman Brothers Merchant Banking Portfolio Partnership, L.P.,
Lehman Brothers Offshore Investment Partnership, L.P. and Lehman Brothers
Offshore Investment Partnership-Japan L.P. (collectively, the "LEHMAN
PARTNERSHIPS");
WHEREAS, immediately following the Distribution, SpaceCom, SS/L
Bermuda and the Lehman Partnerships will be parties to the Second Amended
and Restated Agreement dated as of November 13, 1992, as amended as of
April 22, 1996 (the "SS/L BERMUDA STOCKHOLDERS AGREEMENT").
WHEREAS, pursuant to Sections 2.9, 2.10 and 5.4 of the SS/L
Bermuda Stockholders Agreement, the Lehman Partnerships have, under certain
circumstances and subject to certain conditions, the right to require SS/L
to purchase from the Lehman Partnerships all of the Series S Preferred
Stock;
WHEREAS, immediately following the Distribution, each of SS/L
Bermuda, Aerospatiale Societe Nationale Industrielle, Alcatel Espace,
Daimler-Benz Aerospace A.G. and Finmeccanica S.p.A. (collectively, the
"STRATEGIC PARTNERS") will own shares of common stock, $.10 par value per
share ("SS/L COMMON STOCK"), of Space Systems/Loral, Inc., a Delaware
corporation ("SS/L");
WHEREAS, SpaceCom, SS/L Bermuda and SS/L intend to enter into
an agreement with the Strategic Partners to amend that certain Stockholders
Agreement, dated as of April 22, 1991, as amended November 2, 1992 (as
amended by such contemplated amendment, the "SS/L STOCKHOLDERS AGREEMENT");
WHEREAS, pursuant to Section 4.4 of the SS/L Stockholders
Agreement each of the Strategic Partners has, under certain circumstances
and subject to certain conditions, the right to require SS/L to purchase
from the Strategic Partner shares of SS/L Common Stock beneficially owned
by the Strategic Partner (the "STRATEGIC PARTNER PUT RIGHTS");
WHEREAS, if SpaceCom acquires any of the ownership interests of
the Lehman Partnerships or the Strategic Partners in SS/L Bermuda or SS/L,
respectively, SpaceCom's direct or indirect ownership interest in SS/L will
increase;
WHEREAS, while each of the parties hereto believe that an
increase in the ownership by SpaceCom of SS/L would be entirely consistent
with all applicable law and policies of the Antitrust Authorities (as
defined in Section 2.1(a)), the parties have agreed to enter into this
Agreement to provide for any contingencies that may hereinafter arise;
NOW THEREFORE, in consideration of the foregoing premises and
for other good and valuable consideration, the sufficiency of which is
hereby acknowledged, LMC, Loral and SpaceCom agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.1 GENERAL. For convenience and brevity, certain terms
used in various parts of this Agreement are listed in alphabetical order
and defined or referred to below (such terms to be equally applicable to
both singular and plural forms of the terms defined or referred to):
"CHANGE OF CONTROL" has, with respect to the Lehman Put Rights,
the meaning assigned to the term in the SS/L Bermuda Stockholders Agreement
and has, with respect to the Strategic Partner Put Rights, the meaning
assigned to that term in the SS/L Stockholders Agreement.
"CLOSING MARKET PRICE" for each day for any publicly traded
security means the last reported sales price regular way or, in case no
such sale takes place on such day, the average of the closing bid and asked
prices regular way, in either case on the principal national securities
exchange on which the shares of the publicly traded security are listed or
admitted to trading, or, if not listed or admitted to trading on any
national securities exchange, on the Nasdaq National Market or, if the
shares of the publicly traded security are not listed or admitted to
trading on any national securities exchange or quoted on the Nasdaq
National Market, the average of the closing bid and asked prices as
furnished by any New York Stock Exchange member firm selected from time to
time by LMC for such purpose.
"DISTRIBUTION DATE" has the meaning assigned to that term in the
Distribution Agreement.
"EXERCISE" means (i) the valid exercise by the Lehman
Partnerships of the Lehman Put Rights or by a Strategic Partner of the
Strategic Partner Put Rights for reasons unrelated to a Change of Control
other than the Change of Control resulting from the consummation of the
Offer (as defined in the Merger Agreement) and/or (ii) the repurchase of
SS/L Securities from the Lehman Partnerships by SpaceCom, SS/L Bermuda or
SS/L otherwise than pursuant to an exercise of the Lehman Put Rights.
"FAIR MARKET VALUE" means (i) with respect to any publicly
traded security, the average of the Closing Market Prices of such security
for the 10 consecutive trading days ended immediately before the date of
the Requirement Notice, and (ii) with respect to a security not publicly
traded, the fair market value, as of the date of the Requirement Notice,
determined as if the Company whose security is being valued were to be sold
in its entirety with a reasonable amount of time available to negotiate and
consummate such sale; provided, that for purposes of clauses (i) and (ii)
of this definition, the Fair Market Value of SpaceCom Preferred Shares
shall be deemed to be equal to the Fair Market Value of SpaceCom Common
Stock into which they are convertible.
"GTL" means Globalstar Telecommunications Limited, a company
organized under the laws of Bermuda.
"GTL COMMON STOCK" means the common stock, $1.00 par value per
share, of GTL.
"LEHMAN PUT RIGHTS" means the rights of the Lehman Partnerships
to require SpaceCom, SS/L, SS/L Bermuda or any affiliate of SpaceCom to
purchase SS/L Securities beneficially owned by the Lehman Partnerships
pursuant to Sections 2.9, 2.10 or 5.4 of the SS/L Bermuda Stockholders
Agreement as in effect on the date hereof or as such agreement may be
amended from time to time hereafter with respect to (i) the conditions
precedent to the Lehman Partnerships' right to require the repurchase of
the SS/L Securities, (ii) the times at which such repurchase must occur and
(iii) the number of shares of SS/L Securities required to be sold in
connection with the exercise of any such rights.
"OWNERSHIP INCREASE" means any increase in the beneficial
ownership of equity securities of SS/L, or, as the context shall require,
any binding agreement (an "OWNERSHIP INCREASE AGREEMENT") to enter into a
transaction or series of transactions that would result in such an
increase.
"REQUIREMENT NOTICE" has the meaning set forth in Section 3.2
hereof.
"SERIES S PREFERRED STOCK" means the shares of Series S
Redeemable Preferred Stock, par value $.01 per share, of SS/L Bermuda.
"SS/L SECURITIES" means equity securities of either SS/L Bermuda
or SS/L.
"STRATEGIC PARTNER PUT RIGHTS" means the rights of a Strategic
Partner to require SpaceCom, SS/L, SS/L Bermuda or any affiliate of
SpaceCom to purchase SS/L Securities beneficially owned by the Strategic
Partner pursuant to Section 4.4 of the SS/L Stockholders Agreement as in
effect on the date hereof or as such agreement may be amended from time to
time hereafter with respect to (i) the conditions precedent to the
Strategic Partner's right to require the repurchase of the SS/L Securities,
(ii) the times at which such repurchase must occur and (iii) the number of
shares of SS/L Securities required to be sold in connection with the
exercise of any such rights.
"TRANSFERRED SHARES" has the meaning set forth in Section 3.1(a)
hereof.
ARTICLE II
ANTITRUST APPROVAL AND REVIEW
SECTION 2.1 ANTITRUST APPROVAL.
(a) The parties acknowledge and agree that an Ownership
Increase could result in a requirement on the part of SS/L, SpaceCom and
other parties to abide by a waiting period imposed under the
Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the "HSR
ACT"), and to make certain filings required thereunder, and could otherwise
be subject to approval by the relevant governmental or supragovernmental
antitrust authorities of the United States or the European Community (the
"ANTITRUST AUTHORITIES"). Any such approval with respect to an Ownership
Increase resulting from an Exercise and the lapse or early termination of
the HSR Act waiting period with respect thereto is hereinafter referred to
as an "APPROVAL".
(b) SpaceCom agrees that it shall not seek Approval unless it
shall have received the prior written opinion of Willkie Farr & Gallagher
(and/or such other counsel reasonably acceptable to LMC) that absent such
Approval, the Ownership Increase would constitute a violation of law (the
"OPINION").
SECTION 2.2 ANTITRUST REVIEW.
(a) SpaceCom will give LMC prompt written notice of any
Ownership Increase resulting from an Exercise and a copy of any Opinion
received in connection therewith.
(b) Following delivery of the Opinion to LMC, LMC and SpaceCom
will (i) take promptly all actions necessary to make the filings required
of LMC, SpaceCom or any of their affiliates necessary to obtain the
Approval, (ii) comply at the earliest practicable date with any request
from the Antitrust Authorities for additional information or documentary
material related to the Ownership Increase, and (iii) cooperate in
connection with any filing required by the Antitrust Authorities in
connection with the Approval and in connection with resolving any
investigation or other inquiry commenced by the Antitrust Authorities
concerning the Ownership Increase.
(c) In furtherance and not in limitation of the covenants of
LMC and SpaceCom contained in Section 2.2(b) hereof, LMC and SpaceCom shall
each use reasonable efforts to resolve such objections, if any, as may be
asserted with respect to the Ownership Increase. SpaceCom shall use its
reasonable efforts to obtain the Approval without the Approval being
conditioned upon a change in LMC's ownership interest in SpaceCom,
including, without limitation, SpaceCom's agreeing to reasonable
alternative conditions or proposals of the Antitrust Authorities not
involving any change in LMC's ownership interest in SpaceCom; provided,
that SpaceCom shall not be required to take any action or agree to any
alternative conditions or proposals that would have a material adverse
effect on SpaceCom. LMC will, and will cause its subsidiaries, to use
reasonable efforts to assist SpaceCom in obtaining the Approval without the
Approval being conditioned upon any change in LMC's ownership interest in
SpaceCom including, without limitation, agreeing to reasonable alternative
conditions or proposals of the Antitrust Authorities not involving any
reduction in LMC's ownership of SpaceCom Securities; provided that LMC
shall not be required to take any action, or agree to any alternative
conditions or proposals, that could, in the reasonable judgment of LMC,
have a material adverse effect on LMC's investment in SpaceCom.
ARTICLE III
EXCHANGE
SECTION 3.1 EXCHANGE.
(a) If, following an Ownership Increase resulting from an
Exercise and receipt of the Opinion, an Antitrust Authority requires as a
condition to the Approval that the indirect ownership interest of LMC in
SS/L be reduced below the indirect ownership interest that would otherwise
result from the Ownership Increase (the "ANTITRUST REQUIREMENT"), then LMC
shall be required to transfer to SpaceCom shares of SpaceCom Securities
beneficially owned by LMC as specified in Section 3.1(c) hereof in exchange
for shares of GTL Common Stock; provided, however, that no such transfer
shall be required if the transactions contemplated by an Ownership Increase
Agreement are not completed.
(b) SpaceCom shall provide prompt written notice of the
Antitrust Requirement to LMC and shall include therein reasonable evidence
of the Antitrust Requirement (the "REQUIREMENT NOTICE").
(c) The number of shares of SpaceCom Securities to be
transferred by or on behalf of LMC (the "TRANSFERRED SHARES") shall be the
minimum number of shares necessary to reduce LMC's indirect ownership
interest in SS/L to the maximum ownership interest therein permitted by the
Antitrust Authorities as a condition necessary to the Approval; it being
understood that nothing in this Agreement will require LMC to reduce its
fully-diluted ownership interest in SpaceCom below 20% unless, prior to
such reduction, appropriate modification of Section 1.4 of the SpaceCom
Stockholders Agreement shall have been made that preserves the economic
benefits to Loral of the option contained in such Section 1.4. The number
of shares of GTL Common Stock to be delivered to LMC in exchange for the
Transferred Shares shall be a number of shares of GTL Common Stock having a
Fair Market Value equal to the Fair Market Value of the Transferred Shares.
(d) Notwithstanding the provisions of Section 3.1(a) hereof,
SpaceCom shall not be required to deliver shares of GTL Common Stock to LMC
as required thereunder if an Antitrust Authority from which Approval is
requested, as a condition to the Approval, prohibits the exchange of GTL
Common Stock for the Transferred Shares. In such event, in lieu of
transferring GTL Common Stock to LMC in exchange for the Transferred
Shares, SpaceCom shall pay LMC, upon surrender and transfer of the
Transferred Shares to SpaceCom, cash in an amount equal to the greater of
(i) the Fair Market Value of the Transferred Shares and (ii) the original
purchase price of the Transferred Shares, increased at the rate of 10% per
annum, compounded annually, from the date of the consummation of the Offer
(as defined in the Merger Agreement) through the date of the transfer of
the Transferred Shares to SpaceCom. The parties agree that for the purposes
of this Section 3.1(d) the aggregate original purchase price of the
SpaceCom Securities owned beneficially by LMC on the Distribution Date is
$344 million.
SECTION 3.2 DETERMINATION OF CONSIDERATION. Following receipt
of the Requirement Notice by LMC, each of LMC and SpaceCom will use their
reasonable efforts to reach an agreement on the number of shares of GTL
Common Stock to be transferred, or the amount of cash to be paid, as the
case may be, pursuant to Section 3.1(c) hereof, to LMC in exchange for the
Transferred Shares. If, within 10 business days after the date of delivery
of the Requirement Notice, LMC and SpaceCom cannot agree on the number of
shares of GTL Common Stock or amount of cash, as the case may be, to be
received by LMC in consideration of the Transferred Shares pursuant to
Section 3.1 hereof (the "CONSIDERATION"), then the Consideration shall be
determined by such nationally recognized investment bank as LMC and
SpaceCom shall jointly select (the "DESIGNATED INVESTMENT BANK"). LMC and
SpaceCom shall use their best efforts to cause the determination of the
Consideration by the Designated Investment Bank to be completed in five
business days if SpaceCom Securities and GTL Common Stock are both publicly
traded securities and otherwise in 60 days, in each case, after the date of
engagement of the Designated Investment Bank. The determination of the
Designated Investment Bank shall be final and binding on the parties
hereto. One-half of the fees and expenses of the Designated Investment Bank
shall be paid by each of LMC and SpaceCom.
SECTION 3.3 NEW REGISTRATION RIGHTS. If the Consideration is
shares of GTL Common Stock, then on or before the date the Consideration is
received by LMC, SpaceCom shall cause GTL to enter into an agreement with
LMC and Loral providing for LMC and Loral to have registration rights with
respect to all of the shares of GTL Common Stock received in exchange for
the Transferred Shares, the terms of which shall be substantially identical
to the registration rights of Loral with respect to the SpaceCom Securities
set forth in Article III of the SpaceCom Stockholders Agreement; provided,
that the minimum number of shares and minimum value of shares of GTL Common
Stock required to be included in any registration shall be adjusted in
direct proportion to the difference, if any, in the market capitalization
of GTL as compared to the market capitalization of SpaceCom, on the date of
the Requirement Notice.
SECTION 3.4 CLOSING OF EXCHANGE. The closing with respect to
the exchange of the Transferred Shares for the Consideration pursuant to
Article III hereof shall be on a mutually determined closing date which
shall be the later of a date not more than 15 days after (i) the date on
which LMC and SpaceCom agree on the Consideration or, if applicable, the
Designated Investment Bank determines the Consideration and (ii) the
consummation of the transactions resulting in the Ownership Increase. The
closing shall be held at 10:00 a.m., local time, at the principal office of
SpaceCom, or at such other time or place as LMC and SpaceCom mutually
agree. On such closing date, LMC and, if applicable, SpaceCom shall deliver
(i) certificates representing the shares of SpaceCom Securities and, if
applicable, GTL Common Stock, respectively, which shares shall be free and
clear of any lien, claim or encumbrance, and in the case of the GTL Common
Stock, shall be validly issued, fully paid and non-assessable, and (ii)
such instruments of transfer and evidence of ownership and authority as the
other party may reasonably request. In the event the Consideration is cash,
then SpaceCom shall pay the Consideration to LMC by wire transfer of
immediately available funds no later than 2:00 p.m. on the closing date to
the account designated by LMC prior to such closing date.
ARTICLE IV
MISCELLANEOUS
SECTION 4.1 ENTIRE AGREEMENT. This Agreement, the Distribution
Agreement and the SpaceCom Stockholders Agreement (including the schedules
and exhibits and the agreements and other documents referred to therein)
constitute the entire agreement among the parties with respect to the
subject matter hereof and supersedes all other prior negotiations,
commitments, agreements and understandings, both written and oral, between
the parties or any of them with respect to the subject matter hereof.
SECTION 4.2 FEES AND EXPENSES. Except as otherwise provided in
the last sentence of Section 3.2 hereof, all reasonable costs and expenses
incurred by the parties hereto in connection with consummating such party's
obligations hereunder or otherwise shall be paid by SpaceCom; provided,
however, that upon the request of SpaceCom, LMC shall advise SpaceCom from
time to time of the extent of the activities of LMC's outside advisors in
connection with LMC satisfying its obligations under Section 2.2(b) hereof;
and provided further, that LMC shall consider in good faith the reasonable
requests of SpaceCom with respect to reducing the costs and expenses being
incurred by LMC in connection therewith.
SECTION 4.3 GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY
AND INTERPRETED AND ENFORCED IN ACCORDANCE WITH THE SUBSTANTIVE LAWS OF THE
STATE OF NEW YORK WITHOUT GIVING EFFECT TO THE CHOICE OF LAW PRINCIPLES
THEREOF (EXCEPT IN THOSE CIRCUMSTANCES WHERE THE CORPORATE LAW OF THE
COMPANY'S JURISDICTION OF ORGANIZATION REQUIRES THE APPLICATION OF THE LAW
OF THE COMPANY'S JURISDICTION OF ORGANIZATION WITH RESPECT TO A PARTICULAR
MATTER).
SECTION 4.4 NOTICES. All notices and other communications
hereunder shall be in writing and shall be deemed given upon (a)
transmitter's confirmation of a receipt of a facsimile transmission, (b)
confirmed delivery by a standard overnight carrier or when delivered by
hand or (c) the expiration of five Business Days after the day when mailed
by certified or registered mail, postage prepaid, addressed at the
following addresses (or at such other address for a party as shall be
specified by like notice):
(i) If to LMC or Loral, to:
Lockheed Martin Corporation
6801 Rockledge Drive
Bethesda, MD 20817
Telephone: (301) 897-6125
Telecopy No.: (301) 897-6333
Attention: Frank H. Menaker, Jr., General Counsel
and to:
Skadden, Arps, Slate, Meagher & Flom
919 Third Avenue
New York, New York 10022
Telephone: (212) 735-3000
Telecopy No.: (212) 735-2000
Attention: Peter Allan Atkins, Esq.
and to:
O'Melveny & Myers
One Citicorp Center
153 E. 53rd Street
New York, New York 10022
Telephone: (212) 326-2000
Telecopy No.: (212) 326-2160
Attention: Jeffrey J. Rosen, Esq.
(ii) If to SpaceCom, to:
Loral Space & Communications Ltd.
600 Third Avenue
New York, New York
Telephone: (212) 697-1105
Telecopy No.: (212) 602-9805
Attention: Eric J. Zahler, General Counsel
with a copy to:
Willkie Farr & Gallagher
One Citicorp Center
153 E. 53rd Street
New York, New York 10022
Telephone: (212) 821-8000
Telecopy No.: (212) 821-8111
Attention: Robert B. Hodes, Esq.
Bruce R. Kraus, Esq.
SECTION 4.5 SUCCESSORS AND ASSIGNS; RECLASSIFICATIONS; NO THIRD
PARTY BENEFICIARIES. This Agreement and all of the provisions hereof shall
be binding upon and inure to the benefit of the parties and their
respective successors and permitted assigns, but neither this Agreement nor
any of the rights, interests or obligations hereunder shall be assigned by
any party hereto (whether by operation of law or otherwise) without the
prior written consent of the other parties hereto (which consent may not be
unreasonably withheld), except that any party shall have the right, without
the consent of any other party hereto, to assign all or a portion of its
rights, interests and obligations hereunder to one or more direct or
indirect subsidiaries, but no such assignment of obligation shall relieve
the assigning party from its responsibility therefor. In the event of any
recapitalization or reclassification of any SpaceCom Securities, or any
merger, consolidation or other transaction with like effect, the securities
issued in replacement or exchange for such SpaceCom Securities shall be
deemed SpaceCom Securities hereunder. This Agreement shall be binding upon
and inure solely to the benefit of each party hereto, and nothing in this
Agreement, express or implied, is intended to or shall confer upon any
other person any rights, benefits or remedies of any nature whatsoever
under or by reason of this Agreement.
SECTION 4.6 COUNTERPARTS. This Agreement may be executed in two
or more counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument.
SECTION 4.7 FURTHER ASSURANCES. Each party hereto or person
subject hereto shall do and perform or cause to be done and performed all
such further acts and things and shall execute and deliver all such other
agreements, certificates, instruments and documents as any other party
hereto or person subject hereto may reasonably request in order to carry
out the intent and accomplish the purposes of this Agreement and the
consummation of the transactions contemplated hereby.
SECTION 4.8 INTERPRETATION. The descriptive 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. Unless
otherwise specified in this Agreement, all references in this Agreement to
"days" shall be deemed to be references to calendar days.
SECTION 4.9 SUMMARY PROCEEDING. No dispute arising with respect
to this Agreement where the amount in controversy as to at least one party,
exclusive of interest and costs, exceeds One Million Dollars ($1,000,000)
(a "SUMMARY PROCEEDING"), shall be litigated except in the Superior Court
of the State of Delaware (the "DELAWARE SUPERIOR COURT") as a summary
proceeding pursuant to Rules 124-131 of the Delaware Superior Court, or any
successor rules (the "SUMMARY PROCEEDING RULES"). Each of the parties
hereto hereby irrevocably and unconditionally (i) submits to the
jurisdiction of the Delaware Superior Court for any Summary Proceeding,
(ii) agrees not to commence any Summary Proceeding except in the Delaware
Superior Court; (iii) waives, and agrees not to plead or to make, any
objection to the venue of any Summary Proceeding in the Delaware Superior
Court, (iv) waives, and agrees not to plead or to make, any claim that the
Delaware Superior Court lacks personal jurisdiction over it, and (iv)
waives its right to remove any Summary Proceeding to the federal courts
except where such courts are vested with sole and exclusive jurisdiction by
statute.
SECTION 4.10 SPECIFIC PERFORMANCE. Each of the parties hereto
acknowledges and agrees that in the event of any breach of this Agreement,
each non-breaching party would be irreparably and immediately harmed and
could not be made whole by monetary damages. It is accordingly agreed that
the parties hereto (a) will waive, in any action for specific performance,
the defense of adequacy of a remedy at law and (b) shall be entitled, in
addition to any other remedy to which they may be entitled at law or in
equity, to compel specific performance of this Agreement in any action
instituted in any court referred to in Section 4.9 hereof.
----------------------------
IN WITNESS WHEREOF, each of the parties has caused this
Exchange Agreement to be executed on its behalf by its officers thereunto
duly authorized, all as of the day and year first above written.
LORAL SPACE & COMMUNICATIONS LTD.
By:_____________________________
Name:
Title:
LOCKHEED MARTIN CORPORATION
By:_____________________________
Name:
Title:
LORAL CORPORATION
By:_____________________________
Name:
Title: