EXHIBIT 1.1
4,400,000 SHARES
L-3 COMMUNICATIONS HOLDINGS, INC.
COMMON STOCK, $.01 PAR VALUE
FORM OF U.S. UNDERWRITING AGREEMENT
May __, 1998
▇▇▇▇▇▇ BROTHERS INC.
BEAR, ▇▇▇▇▇▇▇ & CO. INC.
CREDIT SUISSE FIRST BOSTON CORPORATION
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & CO. INCORPORATED
▇.▇. ▇▇▇▇▇▇▇▇▇, TOWBIN
As Representatives of the several
U.S. Underwriters named in Schedule 1,
c/▇ ▇▇▇▇▇▇ Brothers Inc.
Three World ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Dear Sirs:
L-3 Communications Holdings, Inc., a Delaware corporation
(the "Company"), proposes to sell 4,400,000 shares (the "Firm Stock") of the
Company's Common Stock, par value $.01 per share (the "Common Stock"). In
addition, the Company proposes to grant to the U.S. Underwriters named in
Schedule 1 hereto (the "U.S. Underwriters") an option to purchase up to an
additional 825,000 shares of the Common Stock on the terms and for the purposes
set forth in Section 2 (the "Option Stock"). The Firm Stock and the Option
Stock, if purchased, are hereinafter collectively called the "Stock." As
described in the Prospectus (hereinafter defined), the Company will use the net
proceeds from the sale of the Stock to repay a substantial portion of its
existing indebtedness and for general corporate purposes, including potential
acquisitions. This is to confirm the agreement concerning the purchase of the
Stock from the Company by the U.S. Underwriters.
It is understood by all parties that the Company is
concurrently entering into an agreement dated the date hereof (the
"International Underwriting Agreement") providing for the sale by the Company
of 1,100,000 shares of Common Stock (the "International Stock") through
arrangements with certain underwriters outside the United States (the
"International Managers"), for whom ▇▇▇▇▇▇ Brothers International (Europe),
Bear, ▇▇▇▇▇▇▇ International Limited, Credit Suisse First Boston (Europe)
Limited, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. International Limited and ▇.▇. ▇▇▇▇▇▇▇▇▇, Towbin
are acting as lead managers. The U.S. Underwriters and the International
Managers simultaneously are entering into an agreement between the U.S. and
international
underwriting syndicates (the "Agreement Between U.S. Underwriters and
International Managers") which provides for, among other things, the transfer
of shares of Common Stock between the two syndicates. Two forms of prospectus
are to be used in connection with the offering and sale of shares of Common
Stock contemplated by the foregoing, one relating to the Stock and the other
relating to the International Stock. The latter form of prospectus will be
identical to the former except for certain substitute pages as included in the
registration statement and amendments thereto referred to below. Except as used
in Sections 2, 3, 4 and 9 herein, and except as the context may otherwise
require, references herein to the Stock shall include all the shares of Common
Stock which may be sold pursuant to either this Agreement or the International
Underwriting Agreement, and references herein to any prospectus whether in
preliminary or final form, and whether as amended or supplemented, shall
include both the U.S. and the international versions thereof.
1. Representations, Warranties and Agreements of the Company.
The Company represents, warrants and agrees that:
(a) A registration statement on Form S-1, and
amendments ▇▇. ▇, ▇▇. ▇, ▇▇. ▇ and No. 4 thereto, with
respect to the Stock have (i) been prepared by the Company in
conformity with the requirements of the United States
Securities Act of 1933, as amended (the "Securities Act") and
the rules and regulations (the "Rules and Regulations") of
the United States Securities and Exchange Commission (the
"Commission") thereunder, (ii) been filed with the Commission
under the Securities Act and (iii) become effective under the
Securities Act. Copies of such registration statement and the
amendments thereto have been delivered by the Company to you
as the representatives (the "Representatives") of the U.S.
Underwriters. As used in this Agreement, "Effective Time"
means the date and the time as of which such registration
statement, or the most recent post-effective amendment
thereto, if any, was declared effective by the Commission;
"Effective Date" means the date of the Effective Time;
"Preliminary Prospectus" means each prospectus included in
such registration statement, or amendments thereof, before it
became effective under the Securities Act and any prospectus
filed with the Commission by the Company with the consent of
the Representatives pursuant to Rule 424(a) of the Rules and
Regulations; "Registration Statement" means such registration
statement, as amended at the Effective Time, including all
information contained in the final prospectus filed with the
Commission pursuant to Rule 424(b) of the Rules and
Regulations in accordance with Section 5 hereof and deemed to
be a part of the registration statement as of the Effective
Time pursuant to paragraph (b) of Rule 430A of the Rules and
Regulations; and "Prospectus" means such final prospectus, as
first filed with the Commission pursuant to paragraph (1) or
(4) of Rule 424(b) of the Rules and Regulations. If the
Company has filed or is required pursuant to the terms hereof
to file a registration statement pursuant to Rule 462(b)
under the Securities Act registering additional shares of
Common Stock (a "Rule 462(b)
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Registration Statement"), then, unless otherwise specified,
any reference herein to the term "Registration Statement"
shall be deemed to include such Rule 462(b) Registration
Statement. The Commission has not issued any order preventing
or suspending the use of any Preliminary Prospectus; and no
stop order suspending the effectiveness of the Registration
Statement is in effect, and no proceedings for such purpose
are pending before or threatened by the Commission. Any Rule
462(b) Registration Statement filed after the effectiveness
of this Agreement will become effective no later than 10:00
P.M., New York City time, on the date of this Agreement.
(b) The Registration Statement (other than any Rule
462(b) Registration Statement to be filed by the Company
after the effectiveness of this Agreement) conforms, and the
Prospectus and any further amendments or supplements to the
Registration Statement (including, if the Company is required
to file a Rule 462(b) Registration Statement after the
effectiveness of this Agreement, such Rule 462(b)
Registration Statement and any amendments thereto) or the
Prospectus will, when they become effective or are filed with
the Commission, as the case may be, conform in all respects
to the requirements of the Securities Act and the Rules and
Regulations and do not and will not, as of the applicable
effective date (as to the Registration Statement and any
amendment thereto) and as of the applicable filing date (as
to the Prospectus and any amendment or supplement thereto)
contain 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;
provided that no representation or warranty is made as to
information contained in or omitted from the Registration
Statement or the Prospectus in reliance upon and in
conformity with written information furnished to the Company
through the Representatives by or on behalf of any U.S.
Underwriter specifically for inclusion therein.
(c) The market-related and customer-related data and
estimates included in the Prospectus are based on or derived
from sources which the Company believes to be reliable and
accurate.
(d) The Company and each of its subsidiaries (as
defined in Section 15) have been duly incorporated and are
validly existing as corporations in good standing under the
laws of their respective jurisdictions of incorporation, are
duly qualified to do business and are in good standing as
foreign corporations in each jurisdiction in which their
respective ownership or lease of property or the conduct of
their respective businesses requires such qualification
except for such qualification and good standing the failure
of which, individually or in the aggregate, would not result
in a material adverse effect on the condition (financial or
other), business, prospects, properties, stockholders' equity
or results of operations of the Company and its subsidiaries
taken as a whole (a "Material
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Adverse Effect"), and have all power and authority necessary
to own or hold their respective properties and to conduct the
businesses in which they are engaged; and none of the
subsidiaries of the Company (other than L-3 Communications
Corporation (the "Significant Subsidiary")) is a "significant
subsidiary," as such term is defined in Rule 405 of the Rules
and Regulations.
(e) Prior to the delivery of the Stock on the First
Delivery Date, the Company will have an authorized
capitalization as set forth in the Prospectus, and all of the
issued shares of capital stock of the Company have been duly
and validly authorized and issued, are fully paid and
non-assessable and conform to the description thereof
contained in the Prospectus; and all of the issued shares of
capital stock of each subsidiary of the Company have been
duly and validly authorized and issued and are fully paid and
non-assessable and (except for directors' qualifying shares)
are owned directly or indirectly by the Company, free and
clear of all liens, encumbrances, equities or claims, other
than (i) liens, encumbrances, equities or claims described in
the Prospectus and (ii) such other liens, encumbrances,
equities or claims as are not, individually or in the
aggregate, material to the Company and its subsidiaries,
taken as a whole.
(f) Prior to the delivery of the Stock on the First
Delivery Date, the shares of the Stock to be issued and sold
by the Company to the U.S. Underwriters hereunder and to the
International Managers under the International Underwriting
Agreement have been duly and validly authorized and, when
issued and delivered against payment therefor as provided
herein and in the International Underwriting Agreement, will
be duly and validly issued, fully paid and non-assessable;
and the Stock will conform to the description thereof
contained in the Prospectus.
(g) This Agreement has been duly authorized,
executed and delivered by the Company and the Significant
Subsidiary.
(h) The execution, delivery and performance of this
Agreement and the International Underwriting Agreement by the
Company and the Significant Subsidiary and the consummation
of the transactions contemplated hereby and thereby will not
conflict with or constitute a breach of, or a default under,
any indenture, mortgage, deed of trust, loan agreement or
other agreement or instrument to which the Company or any of
its subsidiaries is a party or by which the Company or any of
its subsidiaries is bound or to which any of the property or
assets of the Company or any of its subsidiaries is subject
that is material to the financial condition or prospects of
the Company and its subsidiaries, taken as a whole
(collectively, the "Material Agreements"), except for breach
of which, individually, or in the aggregate, would not result
in a Material Adverse Effect, nor will such actions result in
any violation of the provisions of the charter or by-laws of
the Company or any of its subsidiaries or any material law,
statute or any
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order, rule or regulation of any court or governmental agency
or body having jurisdiction over the Company or any of its
subsidiaries or any of their properties or assets, provided
that the provisions for indemnificaiton and contribution
hereunder and thereunder may be limited by equitable
principles and public policy consideration; and except for
the registration of the Stock and the International Stock
under the Securities Act and such consents, approvals,
authorizations, registrations or qualifications as may be
required under the United States Securities Exchange Act of
1934, as amended (the "Exchange Act") and applicable state or
foreign securities laws in connection with the purchase and
distribution of the Stock by the U.S. Underwriters and the
International Managers, no consent, approval, authorization
or order of, or filing or registration with, any such court
or governmental agency or body is required for the execution,
delivery and performance of this Agreement, or the
International Underwriting Agreement by the Company and
the Significant Subsidiary and the consummation of the
transactions contemplated hereby and thereby.
(i) Except as described in the Prospectus, there are
no contracts, agreements or understandings between the
Company and any person granting such person the right (other
than rights which have been waived or satisfied or rights not
exercisable in connection with the Registration Statement) to
require the Company to file a registration statement under
the Securities Act with respect to any securities of the
Company owned or to be owned by such person or to require the
Company to include such securities in the securities
registered pursuant to the Registration Statement or in any
securities being registered pursuant to any other
registration statement filed by the Company under the
Securities Act.
(j) Except as described in the Registration
Statement, the Company has not sold or issued any shares of
Common Stock during the six-month period preceding the date
of the Prospectus, including any sales pursuant to Rule 144A
under, or Regulations D or S of, the Securities Act other
than shares issued pursuant to employee benefit plans,
qualified stock options plans or other employee compensation
plans or pursuant to outstanding options, rights or warrants.
(k) Neither the Company nor any of its subsidiaries
has incurred, since the date of the latest audited financial
statements included in the Prospectus, any liability or
obligation, direct or contingent, or entered into any
transaction, in each case not in the ordinary course of
business, that is material to the Company and its
subsidiaries taken as a whole, otherwise than as set forth or
contemplated in the Prospectus; and, since such date, there
has not been any material change in the capital stock or
material increase in the short-term or long-term debt of the
Company or any of its subsidiaries or any material adverse
change, or any development involving or which would
reasonably be expected to involve a
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Material Adverse Effect, otherwise than as described or
contemplated in the Prospectus.
(l) The historical and pro forma financial
statements, together with related notes, set forth in the
Prospectus comply as to form in all material respects with
the requirements of Regulation S-X under the Securities Act
applicable to registration statements on Form S-1 under the
Securities Act. The historical financial statements of the
Company fairly present the financial position of the Company
(or its predecessors) at the respective dates indicated and
the results of operations and cash flows of the Company (or
its predecessors) for the respective periods indicated, in
accordance with generally accepted accounting principals
consistently applied throughout such periods. Such pro forma
financial statements have been prepared on a basis consistent
with such historical statements of the Company, except for
the pro forma adjustments specified therein, and give effect
to assumptions made on a reasonable basis and in good faith
and present fairly the historical and proposed transactions
contemplated by the Prospectus and this Agreement. The other
financial and statistical information and data included in
the Prospectus, historical and pro forma, have been derived
from the financial records of the Company (or its
predecessors) and, in all material respects, have been
prepared on a basis consistent with such books and records of
the Company (or its predecessor), except as disclosed
therein.
(m) Coopers & ▇▇▇▇▇▇▇ L.L.P., who have certified
certain financial statements of the Company, whose report
appears in the Prospectus and who have delivered the initial
letter referred to in Section 7(g) hereof, are independent
public accountants as required by the Securities Act and the
Rules and Regulations; and Ernst & Young LLP and KPMG Peat
Marwick LLP, whose reports appear in the Prospectus and who
have delivered the initial letters referred to in Sections
7(h) and 7(i) hereof, are independent accountants as required
by the Securities Act and the Rules and Regulations.
(n) The Company and each of its subsidiaries have
good and marketable title to all property (real and personal)
described in the Prospectus as being owned by them, free and
clear of all liens, claims, security interests or other
encumbrances except such as are described in the Prospectus
or, to the extent that any such liens, claims, security
interests or other encumbrances would not have a Material
Adverse Effect (individually or in the aggregate) and all the
material property described in the Prospectus as being held
under lease by the Company and its subsidiaries is held by
them under valid, subsisting and enforceable leases, with
only such exceptions as would not have a Material Adverse
Effect (individually or in the aggregate).
(o) The Company and each of its subsidiaries own or
possess adequate rights to use all material patents,
trademarks, service marks, trade names,
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copyrights, licenses, inventions, trade secrets and other
rights, and all registrations or applications relating
thereto, described in the Prospectus as being owned by them
or necessary for the conduct of their business, except as
such would not have a Material Adverse Effect (individually
or in the aggregate), and the Company is not aware of any
pending or threatened claim to the contrary or any pending or
threatened challenge by any other person to the rights of the
Company and its subsidiaries with respect to the foregoing
which, if determined adversely to the Company and its
subsidiaries, would have a Material Adverse Effect
(individually or in the aggregate).
(p) Except as described in the Prospectus, there are
no legal or governmental proceedings pending or, to the
knowledge of the Company, threatened, against the Company or
any of its subsidiaries or to which the Company or any of its
subsidiaries is a party or of which any property or assets of
the Company or any of its subsidiaries is the subject which,
if determined adversely to the Company or any of its
subsidiaries, are reasonably likely to cause a Material
Adverse Effect
(q) There are no contracts or other documents which
are required to be described in the Prospectus or filed as
exhibits to the Registration Statement by the Securities Act
or by the Rules and Regulations which have not been described
in the Prospectus or filed as exhibits to the Registration
Statement or incorporated therein by reference as permitted
by the Rules and Regulations.
(r) No material relationship, direct or indirect,
exists between or among the Company on the one hand, and the
directors, officers, stockholders, customers or suppliers of
the Company on the other hand, except as described in the
Prospectus.
(s) The Company is not involved in any strike, job
action or labor dispute with any group of employees that
would have a Material Adverse Effect, and, to the Company's
knowledge, no such action or dispute is threatened.
(t) Except as disclosed in the Prospectus, the
Company is in compliance in all material respects with all
presently applicable provisions of the Employee Retirement
Income Security Act of 1974, as amended, including the
regulations and published interpretations thereunder
("ERISA"); no "reportable event" (as defined in ERISA) has
occurred with respect to any "pension plan" (as defined in
ERISA) for which the Company would have any material
liability; the Company has not incurred and does not expect
to incur any material liability under (i) Title IV of ERISA
with respect to termination of, or withdrawal from, any
"pension plan" or (ii) Sections 412 or 4971 of the Internal
Revenue Code of 1986, as amended, including the regulations
and published interpretations thereunder (the "Code") (other
than contributions in the normal course which are
7
not in default); and each "pension plan" for which the
Company would have any liability that is intended to be
qualified under Section 401(a) of the Code is so qualified in
all material respects and nothing has occurred, whether by
action or by failure to act, which would reasonably be
expected to cause the loss of such qualification.
(u) The Company and its subsidiaries have filed all
federal, state and local income and franchise tax returns
required to be filed through the date hereof and have paid
all taxes due thereon, and no tax deficiency has been
determined adversely to the Company or any of its
subsidiaries nor does the Company have any knowledge of any
tax deficiency which, if determined adversely to the Company
and its subsidiaries, might have a Material Adverse Effect.
(v) Neither the Company nor any of its subsidiaries
(i) is in violation of its charter or by-laws, (ii) is in
default in any material respect, and no event has occurred
which, with notice or lapse of time or both, would constitute
such a default, in the due performance or observance of any
term, covenant or condition contained in any Material
Agreement or (iii) is in violation in any material respect of
any law, ordinance, governmental rule, regulation or court
decree to which it or its property or assets may be subject
or has failed to obtain any material license, permit,
certificate, franchise or other governmental authorization or
permit necessary to the ownership of its property or to the
conduct of its business, except as would not, individually or
in the aggregate, have a Material Adverse Effect.
(w) To the best of the Company's knowledge, neither
the Company nor any of its subsidiaries, nor any director,
officer, agent, employee or other person associated with or
acting on behalf of the Company or any of its subsidiaries,
has used any corporate funds for any unlawful contribution,
gift, entertainment or other unlawful expense relating to
political activity; made any direct or indirect unlawful
payment to any foreign or domestic government official or
employee from corporate funds or violated or is in violation
of any provision of the Foreign Corrupt Practices Act of
1977; except as such that would not have a Material Adverse
Effect.
(x) There has been no storage, disposal, generation,
manufacture, refinement, transportation, handling or
treatment of toxic wastes, medical wastes, hazardous wastes
or hazardous substances by the Company or any of its
subsidiaries (or, to the knowledge of the Company, any of
their predecessors in interest) at, upon or from any of the
property now or previously owned or leased by the Company or
its subsidiaries in violation of any applicable law,
ordinance, rule, regulation, order, judgment, decree or
permit or which would require remedial action under any
applicable law, ordinance, rule, regulation, order, judgment,
decree or permit, except for any violation or remedial action
which would not have, or would not be reasonably likely to
have, singularly or in the
8
aggregate with all such violations and remedial actions, a
Material Adverse Effect; there has been no material spill,
discharge, leak, emission, injection, escape, dumping or
release of any kind onto such property or into the
environment surrounding such property of any toxic wastes,
medical wastes, solid wastes, hazardous wastes or hazardous
substances due to or caused by the Company or any of its
subsidiaries or with respect to which the Company has
knowledge, except for any such spill, discharge, leak,
emission, injection, escape, dumping or release which would
not have or would not be reasonably likely to have,
singularly or in the aggregate with all such spills,
discharges, leaks, emissions, injections, escapes, dumpings
and releases, a Material Adverse Effect; and the terms
"hazardous wastes," "toxic wastes," "hazardous substances"
and "medical wastes" shall have the meanings specified in any
applicable local, state, federal and foreign laws or
regulations with respect to environmental protection.
(y) Neither the Company nor any subsidiary is an
"investment company" within the meaning of such term under
the United States Investment Company Act of 1940 and the
rules and regulations of the Commission thereunder.
(z) All of the representations and warranties of the
parties to the International Underwriting Agreement and the
debt underwriting agreement (the "Debt Underwriting
Agreement"), dated as of the date hereof, providing for the
sale by the Company of $150,000,000 in aggregate principal
amount of the Significant Subsidiary's ___% Senior
Subordinated Notes due 2008 (the "Notes") to ▇▇▇▇▇▇ Brothers
Inc. and BancAmerica ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, are true and
correct.
2. Purchase of the Stock by the U.S. Underwriters. On the
basis of the representations and warranties contained in, and subject to the
terms and conditions of, this Agreement, the Company agrees to sell the Firm
Stock to the several U.S. Underwriters and each of the U.S. Underwriters,
severally and not jointly, agrees to purchase the number of shares of the Firm
Stock set opposite that U.S. Underwriter's name in Schedule 1 hereto. The
respective purchase obligations of the U.S. Underwriters with respect to the
Firm Stock shall be rounded among the U.S. Underwriters to avoid fractional
shares, as the Representatives may determine.
In addition, the Company grants to the U.S. Underwriters an
option to purchase, in whole or in part, the Option Stock. Such option is
granted for the purpose of covering over-allotments in the sale of Firm Stock
and is exercisable as provided in Section 4 hereof. Shares of Option Stock
shall be purchased severally for the account of the U.S. Underwriters in
proportion to the number of shares of Firm Stock set opposite the name of such
U.S. Underwriters in Schedule 1 hereto. The respective purchase obligations of
each U.S. Underwriter with respect to the Option Stock shall be adjusted by the
Representatives so that no U.S. Underwriter shall be obligated to purchase
Option Stock other than in 100 share amounts. The price of both the Firm Stock
and any Option Stock shall be $_____ per share.
9
The Company shall not be obligated to deliver any of the
Stock to be delivered on any Delivery Date (as hereinafter defined), as the
case may be, except upon payment for all the Stock to be purchased on such
Delivery Date as provided herein and in the International Underwriting
Agreement.
3. Offering of Stock by the U.S. Underwriters.
Upon authorization by the Representatives of the release of
the Firm Stock, the several U.S. Underwriters propose to offer the Firm Stock
for sale upon the terms and conditions set forth in the Prospectus.
It is understood that 500,000 shares of the Firm Stock will
initially be reserved by the several U.S. Underwriters for offer and sale upon
the terms and conditions set forth in the Prospectus and in accordance with the
rules and regulations of the National Association of Securities Dealers, Inc.
to directors, officers, employees, business associates and related parties of
the Company and its subsidiaries who have heretofore delivered to the
Representatives offers to purchase shares of Firm Stock in form satisfactory to
the Representatives, and that any allocation of such Firm Stock among such
persons will be made in accordance with timely directions received by the
Representatives from the Company; provided, that under no circumstances will
the Representatives or any U.S. Underwriter be liable to the Company or to any
such person for any action taken or omitted in good faith in connection with
such offering to directors, officers, employees, business associates and
related parties of the Company and its subsidiaries. It is further understood
that any shares of such Firm Stock which are not purchased by such persons will
be offered by the U.S. Underwriters to the public upon the terms and conditions
set forth in the Prospectus.
Each U.S. Underwriter agrees that, except to the extent
permitted by the Agreement Between U.S. Underwriters and International
Managers, it will not offer or sell any of the Stock outside of the United
States.
4. Delivery of and Payment for the Stock. Delivery of and
payment for the Firm Stock shall be made at the office of ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇, ▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ at 10:00 A.M., New York City time, on the
third full business day following the date of this Agreement or at such other
date or place as shall be determined by agreement between the Representatives
and the Company. This date and time are sometimes referred to as the "First
Delivery Date." On the First Delivery Date, the Company shall deliver or cause
to be delivered certificates representing the Firm Stock to the Representatives
for the account of each U.S. Underwriter against payment to or upon the order
of the Company of the purchase price by wire transfer in immediately available
funds. Time shall be of the essence, and delivery at the time and place
specified pursuant to this Agreement is a further condition of the obligation
of each U.S. Underwriter hereunder. Upon delivery, the Firm Stock shall be
registered in such names and in such denominations as the Representatives shall
request in writing not less than two full business days prior to the First
Delivery Date. For the purpose of expediting the checking and packaging of the
certificates for the Firm Stock, the Company shall make the
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certificates representing the Firm Stock available for inspection by the
Representatives in New York, New York, not later than 2:00 P.M., New York City
time, on the business day prior to the First Delivery Date.
The option granted in Section 2 will expire 30 days after the
date of this Agreement and may be exercised in whole or in part from time to
time by written notice being given to the Company by the Representatives. Such
notice shall set forth the aggregate number of shares of Option Stock as to
which the option is being exercised, the names in which the shares of Option
Stock are to be registered, the denominations in which the shares of Option
Stock are to be issued and the date and time, as determined by the
Representatives, when the shares of Option Stock are to be delivered; provided,
however, that this date and time shall not be earlier than the First Delivery
Date nor earlier than the second business day after the date on which the
option shall have been exercised nor later than the fifth business day after
the date on which the option shall have been exercised. The date and time the
shares of Option Stock are delivered are sometimes referred to as a "Second
Delivery Date" and the First Delivery Date and any Second Delivery Date are
sometimes each referred to as a "Delivery Date."
Delivery of and payment for the Option Stock shall be made at
the place specified in the first sentence of the first paragraph of this
Section 4 (or at such other place as shall be determined by agreement between
the Representatives and the Company) at 10:00 A.M., New York City time, on such
Second Delivery Date. On such Second Delivery Date, the Company shall deliver
or cause to be delivered the certificates representing the Option Stock to the
Representatives for the account of each U.S. Underwriter against payment to or
upon the order of the Company of the purchase price by wire transfer in
immediately available funds. Time shall be of the essence, and delivery at the
time and place specified pursuant to this Agreement is a further condition of
the obligation of each U.S. Underwriter hereunder. Upon delivery, the Option
Stock shall be registered in such names and in such denominations as the
Representatives shall request in the aforesaid written notice. For the purpose
of expediting the checking and packaging of the certificates for the Option
Stock, the Company shall make the certificates representing the Option Stock
available for inspection by the Representatives in New York, New York, not
later than 2:00 P.M., New York City time, on the business day prior to such
Second Delivery Date.
5. Further Agreements of the Company. The Company agrees:
(a) To prepare the Prospectus in a form approved by
the Representatives and to file such Prospectus pursuant to
Rule 424(b) under the Securities Act not later than
Commission's close of business on the second business day
following the execution and delivery of this Agreement or, if
applicable, such earlier time as may be required by Rule
430A(a)(3) under the Securities Act; to make no further
amendment or any supplement to the Registration Statement or
to the Prospectus except as permitted herein; to advise the
Representatives, promptly (i) after it receives notice
thereof, of the time when any amendment to the Registration
Statement has been filed or becomes effective
11
or any supplement to the Prospectus or any amended Prospectus
has been filed and (ii) if the Company is required to file a
Rule 462(b) Registration Statement after the effectiveness of
this Agreement, when the Rule 462(b) Registration Statement
has become effective and, in the case of each of (i) and
(ii), to furnish the Representatives with copies thereof; to
advise the Representatives, promptly after it receives notice
thereof, of the issuance by the Commission of any stop order
or of any order preventing or suspending the use of any
Preliminary Prospectus or the Prospectus, of the suspension
of the qualification of the Stock for offering or sale in any
jurisdiction, of the initiation or threatening of any
proceeding for any such purpose, or of any request by the
Commission for the amending or supplementing of the
Registration Statement or the Prospectus or for additional
information; and, in the event of the issuance of any stop
order or of any order preventing or suspending the use of any
Preliminary Prospectus or the Prospectus or suspending any
such qualification, to use promptly its reasonable best
efforts to obtain its withdrawal;
(b) To furnish promptly to each of the
Representatives and to counsel for the U.S. Underwriters a
conformed copy of the Registration Statement as originally
filed with the Commission, and each amendment thereto filed
with the Commission, including all consents and exhibits
filed therewith;
(c) To deliver promptly to the Representatives such
number of the following documents as the Representatives
shall reasonably request each Preliminary Prospectus, the
Prospectus and any amended or supplemented Prospectus; and,
if the delivery of a prospectus is required at any time after
the Effective Time in connection with the offering or sale of
the Stock or any other securities relating thereto and if at
such time any events shall have occurred as a result of which
the Prospectus as then amended or supplemented would include
an untrue statement of a material fact or omit to state any
material fact necessary in order to make the statements
therein, in the light of the circumstances under which they
were made when such Prospectus is delivered, not misleading,
or, if for any other reason it shall be necessary to amend or
supplement the Prospectus in order to comply with the
Securities Act, to notify the Representatives and, upon their
request, to file such document and to prepare and furnish
(without charge for the 9 month period following the First
Delivery Date) to each U.S. Underwriter and to any dealer in
securities as many copies as the Representatives may from
time to time reasonably request of an amended or supplemented
Prospectus which will correct such statement or omission or
effect such compliance.
(d) To file promptly with the Commission any
amendment to the Registration Statement or the Prospectus or
any supplement to the Prospectus that may, in the judgment of
the Company or the Representatives, be required by the
Securities Act or requested by the Commission;
12
(e) Prior to filing with the Commission any
amendment to the Registration Statement or supplement to the
Prospectus or any Prospectus pursuant to Rule 424 of the
Rules and Regulations, to furnish a copy thereof to the
Representatives and counsel for the U.S. Underwriters and not
to file any such document to which the Representatives shall
reasonably object after having been given reasonable notice
of the proposed filing thereof;
(f) As soon as practicable after the Effective Date,
(it being understood that the Company shall have until at
least 410 days after the end of the Company's current fiscal
quarter) to make generally available to the Company's
security holders and to deliver to the Representatives an
earnings statement of the Company and its subsidiaries (which
need not be audited) complying with Section 11(a) of the
Securities Act and the Rules and Regulations (including, at
the option of the Company, Rule 158);
(g) Promptly from time to time to take such action
as the Representatives may reasonably request to qualify the
Stock for offering and sale under the securities laws of such
jurisdictions as the Representatives may request (provided,
however, that the Company shall not be obligated to qualify
as a foreign corporation in any jurisdiction in which it is
not now so qualified or to take any action that would subject
it to general consent to service of process in any
jurisdiction in which it is not now so subject) and to comply
with such laws so as to permit the continuance of sales and
dealings therein in such jurisdictions for as long as may be
necessary to complete the distribution of the Stock;
(h) For a period of 180 days from the date of the
Prospectus, not to, directly or indirectly, (1) offer for
sale, sell, or otherwise dispose of (or enter into any
transaction or device which is designed to, or could be
expected to, result in the disposition by any person at any
time in the future of) any shares of Common Stock or
securities convertible into or exchangeable or exercisable
for Common Stock (other than the Stock, the International
Stock and shares issued pursuant to currently outstanding
options, warrants, rights or convertible securities), or (2)
enter into any swap or other derivatives transaction that
transfers to another, in whole or in part, any of the
economic benefits or risks of ownership of such shares of
Common Stock, whether any such transaction described in
clause (1) or (2) above is to be settled by delivery of
Common Stock or other securities, in cash or otherwise, in
each case without the prior written consent of ▇▇▇▇▇▇
Brothers Inc.; and to cause each person who beneficially owns
more than 5% of the outstanding shares of Common Stock as of
the date of the Prospectus and each officer and director of
the Company to furnish to the Representatives, prior to the
date of the Prospectus, a letter or letters, in form and
substance satisfactory to counsel for the U.S. Underwriters,
pursuant to which each such person shall agree not to,
directly or indirectly, (1) offer for sale, sell, or
otherwise dispose of (or enter into any
13
transaction or device which is designed to, or could be
expected to, result in the disposition by any person at any
time in the future of) any shares of Common Stock or
securities convertible into or exchangeable or exercisable
for Common Stock or (2) enter into any swap or other
derivatives transaction that transfers to another, in whole
or in part, any of the economic benefits or risks of
ownership of such shares of Common Stock, whether any such
transaction described in clause (1) or (2) above is to be
settled by delivery of Common Stock or other securities, in
cash or otherwise, in each case for a period of 180 days from
the date of the Prospectus except for transactions by any
person other than the Company and its subsidiaries relating
to shares of Common Stock or other securities convertible
into or exchangeable or exercisable for Common Stock acquired
in open market transactions after the completion of the
Common Stock Offering, without the prior written consent of
▇▇▇▇▇▇ Brothers Inc.;
(i) Prior to the Effective Date, to apply for the
listing of the Stock on the New York Stock Exchange and to
use its best efforts to complete that listing, subject only
to official notice of issuance, prior to the First Delivery
Date;
(j) To apply the net proceeds from the sale of the
Stock being sold by the Company as set forth in the
Prospectus;
(k) To take such steps as shall be necessary to
ensure that neither the Company nor any subsidiary shall
become an "investment company" within the meaning of such
term under the United States Investment Company Act of 1940
and the rules and regulations of the Commission thereunder;
and
(l) If the Registration Statement at the time of the
effectiveness of this Agreement does not cover all of the
Shares, to file a Rule 462(b) Registration Statement with the
Commission registering the Shares not so covered in
compliance with Rule 462(b) by 10:00 P.M., New York City
time, on the date of this Agreement and to pay to the
Commission the filing fee for such Rule 462(b) Registration
Statement at the time of the filing thereof or to give
irrevocable instructions for the payment of such fee pursuant
to Rule 111(b) under the Securities Act.
6. Expenses. The Company agrees to pay (a) the costs incident
to the authorization, issuance, sale and delivery of the Stock and any taxes
payable in that connection; (b) the costs incident to the preparation, printing
and filing under the Securities Act of the Registration Statement and any
amendments and exhibits thereto; (c) the costs of distributing the Registration
Statement as originally filed and each amendment thereto and any post-effective
amendments thereof (including, in each case, exhibits), any Preliminary
Prospectus, the Prospectus and any amendment or supplement to the Prospectus,
all as provided in this Agreement; (d) the filing fees incident to securing any
required review by the National Association of Securities Dealers, Inc. of the
terms of sale of the Stock; (e) any applicable listing
14
or other fees; (f) the fees and expenses of qualifying the Stock under the
securities laws of the several jurisdictions as provided in Section 5(h) and of
preparing, printing and distributing a Blue Sky Memorandum (including related
fees and expenses of counsel to the U.S. Underwriters); (g) all reasonable
costs and expenses of the U.S. Underwriters, including the related reasonable
fees and disbursements of counsel for the U.S. Underwriters, incident to the
offer and sale of shares of the Stock by the U.S. Underwriters to employees of
the Company and its subsidiaries, as described in Section 3; and (h) all other
costs and expenses incident to the performance of the obligations of the
Company; provided, that (x) the Company and the U.S. Underwriters will bear
their own "road show" expenses and (y) the Company on the one hand, and the
U.S. Underwriters on the other hand, will each bear one half of the cost of the
charter aircraft used in connection with the "road show".
7. Conditions of U.S. Underwriters' Obligations. The
respective obligations of the U.S. Underwriters hereunder are subject to the
accuracy, when made and on each Delivery Date, of the representations and
warranties of the Company contained herein, to the performance by the Company
of its obligations hereunder, and to each of the following additional terms and
conditions:
(a) The Prospectus shall have been timely filed with
the Commission in accordance with Section 5(a); no stop order
suspending the effectiveness of the Registration Statement or
any part thereof shall have been issued and no proceeding for
that purpose shall have been initiated or threatened by the
Commission; any request of the Commission for inclusion of
additional information in the Registration Statement or the
Prospectus or otherwise shall have been complied with; and
any 462(b) Registration Statement required by this Agreement
to be filed shall have been so filed and become effective.
(b) No U.S. Underwriter or International Manager
shall have discovered and disclosed to the Company on or
prior to such Delivery Date that the Registration Statement
or the Prospectus or any amendment or supplement thereto
contains an untrue statement of a fact which, in the opinion
of ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇, counsel for the U.S. Underwriters, is
material or omits to state a fact which, in the opinion of
such counsel, is material and is required to be stated
therein or is necessary to make the statements therein not
misleading.
(c) All corporate proceedings and other legal
matters incident to the authorization, form and validity of
this Agreement, the International Underwriting Agreement, the
Stock, the Registration Statement and the Prospectus, and all
other legal matters relating to this Agreement and the
transactions contemplated hereby shall be reasonably
satisfactory in all material respects to counsel for the U.S.
Underwriters, and the Company shall have furnished to such
counsel all documents and information that they may
reasonably request to enable them to pass upon such matters.
15
(d) ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ shall have furnished
to the Representatives its written opinion, as counsel to the
Company, addressed to the U.S. Underwriters and dated such
Delivery Date, in form and substance reasonably satisfactory
to the Representatives, to the effect that:
(i) The Company and each of its Delaware
subsidiaries have been duly incorporated and are
validly existing as corporations and in good
standing under the laws of Delaware, and have all
corporate power and authority necessary to conduct
their respective businesses as described in the
Registration Statement and the Prospectus;
(ii) All of the outstanding shares of
Common Stock of the Company (including the shares of
Stock and International Stock being delivered on
such Delivery Date) have been duly authorized and
all outstanding shares of Common Stock have been
and, upon payment and delivery in accordance with
this Agreement, the Stock will be validly issued,
fully paid and non-assessable; all of the issued
shares of capital stock of each Delaware subsidiary
of the Company have been duly and validly authorized
and issued, are fully paid, and non-assessable
(except for directors' qualifying shares) and, based
soley on an examination of each such subsidiary's
stock ledger and minute books, all such shares are
held of record Company and/or a subsidiary of the
Company;
(iii) The Registration Statement has become
effective under the Securities Act and the
Prospectus was filed pursuant to Rule 424(b)__ of
the rules and regulations of the Commission under
the Act and, to our knowledge, no stop order
suspending the effectiveness of the Registration
Statement has been issued or proceeding for that
purpose has been instituted or threatened by the
Commission;
(iv) The statements contained in the
Prospectus under the captions "Risk Factors-Shares
Eligible for Future Sale," "Risk Factors-Potential
Effect of Certain Anti-takeover Provisions,"
"Business-Pension Plans," "Certain Relationships and
Related Transactions," "Management-Limitations on
Liability and Indemnification Matters,"
"Management-1997 Stock Option Plan,"
"Management-Employment Agreements," "Description of
Certain Indebtedness," "Description of Capital
Stock" and "Shares Eligible for Future Sale,"
insofar as they describe charter documents,
contracts, statutes, rules and regulations and other
legal matters, constitute an accurate summary
thereof in all material respects;
(v) The statements made in the Prospectus
under the caption "United States Federal Tax
Considerations," insofar as they purport to
constitute summaries of matters of United States
federal tax law and
16
regulations or legal conclusions with respect
thereto, constitute accurate summaries of the
matters described therein in all material respects.
(vi) To such counsel's knowledge, there are
no contracts or documents of a character required by
the Securities Act or the rules and regulations
thereunder to be described in the Registration
Statement or the Prospectus or to be filed as
exhibits to the Registration Statement which are not
described or filed as required required by the
Securities Act or the rules and regulations
thereunder;
(vii) This Agreement and the International
Underwriting Agreement have each been duly
authorized, executed and delivered by the Company
and the Significant Subsidiary, as applicable;
(viii) The issue and sale of the shares of
Stock being delivered on such Delivery Date by the
Company and the compliance by the Company and the
Significant Subsidiary, as applicable, with all of
the provisions of this Agreement, the International
Underwriting Agreement and the Debt Underwriting
Agreement and the consummation of the transactions
contemplated hereby and thereby will not breach or
result in a default under, any indenture, mortgage,
deed of trust, loan agreement or other agreement or
instrument filed as an exhibit to the Registration
Statement nor will such actions violate the
Certificate of Incorporation or By-Laws of the
Company or any of its subsidiaries or any federal or
New York statute or the Delaware General Corporation
Law or any rule or regulation that has been issued
pursuant to any federal or New York statute or the
Delaware General Corporation Law or any order known
to such counsel issued pursuant to any federal or
New York statute or the Delaware General Corporation
Law by any court or governmental agency or body or
court having jurisdiction over the Company or any of
its subsidiaries or any of their properties or
assets; and no consent, approval, authorization,
order, registration or qualification of or with any
federal or New York governmental agency or body or
any Delaware governmental agency or body acting
pursuant to the Delaware General Corporation Law or,
to such counsel s knowledge, any federal or New York
court or any Delaware court acting pursuant to the
Delaware General Corporation Law is required for the
issue and sale of the Stock and International Stock
by the Company and the issuance and sale of the
Notes by the Significant Subsidiary (and the
guarantee of such Notes by the Guarantors), except
for the registration under the Act and the Exchange
Act of the Stock, International Stock, Notes and
Guarantees, and such consents, approvals,
authorizations, registrations or qualifications as
may be required under state securities or
17
Blue Sky laws in connection with the purchase and
distribution of the Stock, International Stock,
Notes and Guarantees by the Underwriters. The
opinions set forth in this paragraph are based upon
our consideration of only those statutes, rules and
regulations which, in such counsel's experience, are
normally applicable to securities underwriting
transactions.
In rendering such opinion, such
counsel may (i) state that its opinion is limited to
matters governed by the federal laws of the United
States and the laws of the State of New York and the
Delaware General Corporation Law.
Such counsel shall also have
furnished to the Representatives a written
statement, addressed to the U.S. Underwriters and
dated such Delivery Date. Such counsel has not
independently verified the accuracy, completeness or
fairness of the statements made or included in the
Registration Statement or the Prospectus and take no
responsibility therefor, except as and to the extent
set forth in paragraph (iv) above. In the course of
the preparation by the Company of the Registration
Statement and the Prospectus, such counsel
participated in conferences with certain officers
and employees of the Company, with representatives
of Coopers & ▇▇▇▇▇▇▇ L.L.P., Ernst & Young LLP, KPMG
Peat Marwick LLP and with counsel to the Company.
Based upon our examination of the Registration
Statement and the Prospectus, our investigations
made in connection with the preparation of the
Registration Statement and the Prospectus and our
participation in the conferences referred to above,
(i) such counsel is of the opinion that the
Registration Statement, as of its effective date,
and the Prospectus, as of _______, 1998, complied as
to form in all material respects with the
requirements of the Act and the applicable rules and
regulations of the Commission thereunder, except
that in each case such counsel need not express
opinion with respect to the financial statements or
other financial data contained or incorporated by
reference in the Registration Statement or the
Prospectus, and (ii) such counsel has no reason to
believe that the Registration Statement, as of its
effective date, contained any untrue statement of a
material fact or omitted to state any material fact
required to be stated therein or necessary in order
to make the statements therein not misleading or
that the Prospectus contains any untrue statement of
a material fact or omits to state any material fact
necessary in order to make the statements therein,
in the light of the circumstances under which they
were made, not misleading, except that in each case
such counsel need not express belief with respect to
the financial statements or other financial data
contained in the Registration Statement or the
Prospectus.
(e) ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, General Counsel of the
Company, shall
18
have furnished to the Representatives his written opinion, as
General Counsel to the Company, addressed to the U.S.
Underwriters and dated such Delivery Date, in form and
substance reasonably satisfactory to the Representatives, to
the effect that:
(i) Other than as set forth in the
Prospectus, there are no preemptive or other rights
to subscribe for or to purchase, nor any restriction
upon the voting or transfer of, any shares of the
Stock pursuant to the Company's charter or by-laws
or any agreement or other instrument known to such
counsel;
(ii) To such counsel's knowledge, the
Company and each of its subsidiaries have good and
marketable title to all property (real and personal)
described in the Prospectus as being owned by them,
free and clear of all liens, claims, security
interests or other encumbrances except such as are
described in the Prospectus or, to the extent that
any such liens, claims, security interests or other
encumbrances would not have a Material Adverse
Effect (individually or in the aggregate) and all
the material property described in the Prospectus as
being held under lease by the Company and its
subsidiaries is held by them under valid, subsisting
and enforceable leases, with only such exceptions as
would not have a Material Adverse Effect
(individually or in the aggregate);
(iii) To such counsel's knowledge and
except as otherwise disclosed in the Prospectus,
there are no legal or governmental proceedings
pending or threatened, against the Company or any of
its subsidiaries or to which the Company or any of
its subsidiaries is a party or of which any property
or assets of the Company or any of its subsidiaries
is the subject which, if determined adversely to the
Company or any of its subsidiaries, are reasonably
likely to cause a Material Adverse Effect;
(iv) To such counsel's knowledge and except
as otherwise disclosed in the Prospectus, there are
no contracts, agreements or understandings between
the Company and any person granting such person the
right to require the Company to include such
person's securities in the securities registered
pursuant to the Registration Statement;
(v) None of the issue and sale of the
shares of Stock being delivered on such Delivery
Date by the Company and the compliance by the
Company, the Significant Subsidiary and the
Guarantors, as applicable, with all of the
provisions of this Agreement, the International
Underwriting Agreement and the Debt Underwriting
Agreement and the consummation of the transactions
comtemplated hereby and thereby requires any
consent,
19
approval, authorization or other order of , or
registration or filing with, any federal court,
federal regulatory body, federal administrative
agency or other federal governmental official
having authority over government procurement
matters (provided, thiat the opinion in this
paragraph (v) may be delivered by other counsel
reasonably satisfactory to the Representatives).
(f) The Representatives shall have received from
▇▇▇▇▇▇ & ▇▇▇▇▇▇▇, counsel for the U.S. Underwriters, such
opinion or opinions, dated such Delivery Date, with respect
to the issuance and sale of the Stock, the Registration
Statement, the Prospectus and other related matters as the
Representatives may reasonably require, and the Company shall
have furnished to such counsel such documents as they
reasonably request for the purpose of enabling them to pass
upon such matters.
(g) At the time of execution of this Agreement, the
Representatives shall have received from Coopers & ▇▇▇▇▇▇▇
L.L.P. a letter, in form and substance satisfactory to the
Representatives, addressed to the U.S. Underwriters and dated
the date hereof (i) confirming that they are independent
public accountants within the meaning of the Securities Act
and are in compliance with the applicable requirements
relating to the qualification of accountants under Rule 2-01
of Regulation S-X of the Commission and (ii) stating, as of
the date hereof (or, with respect to matters involving
changes or developments since the respective dates as of
which specified financial information is given in the
Prospectus, as of a date not more than five days prior to the
date hereof), the conclusions and findings of such firm with
respect to the financial information and other matters
ordinarily covered by accountants' "comfort letters" to
underwriters in connection with registered public offerings.
(h) At the time of execution of this Agreement, the
Representatives shall have received from Ernst & Young LLP a
letter, in form and substance satisfactory to the
Representatives, addressed to the U.S. Underwriters and dated
the date hereof (i) confirming that they are independent
public accountants within the meaning of the Securities Act
and are in compliance with the applicable requirements
relating to the qualification of accountants under Rule 2-01
of Regulation S-X of the Commission and (ii) stating, as of
the date hereof (or, with respect to matters involving
changes or developments since the respective dates as of
which specified financial information is given in the
Prospectus, as of a date not more than five days prior to the
date hereof), the conclusions and findings of such firm with
respect to the financial information and other matters
ordinarily covered by accountants' "comfort letters" to
underwriters in connection with registered public offerings.
(i) At the time of execution of this Agreement, the
Representatives shall have received from KPMG Peat Marwick
LLP a letter, in form and
20
substance satisfactory to the Representatives, addressed to
the U.S. Underwriters and dated the date hereof (i)
confirming that they are independent public accountants
within the meaning of the Securities Act and are in
compliance with the applicable requirements relating to the
qualification of accountants under Rule 2-01 of Regulation
S-X of the Commission and (ii) stating, as of the date hereof
(or, with respect to matters involving changes or
developments since the respective dates as of which specified
financial information is given in the Prospectus, as of a
date not more than five days prior to the date hereof), the
conclusions and findings of such firm with respect to the
financial information and other matters ordinarily covered by
accountants' "comfort letters" to underwriters in connection
with registered public offerings.
(j) With respect to the letters referred to in the
preceding three paragraphs and delivered to the
Representatives concurrently with the execution of this
Agreement (the "initial letters"), the Company shall have
furnished to the Representatives letters (the "bring-down
letters") of such accountants, in form and substance
satisfactory to the Representatives, addressed to the U.S.
Underwriters and dated such Delivery Date (i) confirming that
they are independent public accountants within the meaning of
the Securities Act and are in compliance with the applicable
requirements relating to the qualification of accountants
under Rule 2-01 of Regulation S-X of the Commission, (ii)
stating, as of the date of the bring-down letters (or, with
respect to matters involving changes or developments since
the respective dates as of which specified financial
information is given in the Prospectus, as of a date not more
than five days prior to the date of the bring- down letter),
the conclusions and findings of such firms with respect to
the financial information and other matters covered by the
initial letters and (iii) confirming in all material respects
the conclusions and findings set forth in the initial
letters.
(k) The Company shall have furnished to the
Representatives a certificate, dated such Delivery Date, of
its Chairman of the Board, its President or a Vice President
and its chief financial officer stating that:
(i) The representations and warranties of
the Company in Section 1 are true and correct as of
such Delivery Date; the Company has complied with
all its agreements contained herein; and the
conditions set forth in Sections 7(a) and 7(l) have
been fulfilled; and
(ii) They have carefully examined the
Registration Statement and the Prospectus and, in
their opinion (A) as of the Effective Date, the
Registration Statement and Prospectus did not
include any untrue statement of a material fact and
did not omit to state a material fact required to be
stated therein or necessary to make the statements
therein not misleading, and (B) since the Effective
Date no event has occurred
21
which should have been set forth in a supplement or
amendment to the Registration Statement or the
Prospectus.
(l) (i) Neither the Company nor any of its
subsidiaries shall have sustained since the date of the
latest audited financial statements included in the
Prospectus any material loss or interference with its
business from fire, explosion, flood or other calamity,
whether or not covered by insurance, or from any labor
dispute or court or governmental action, order or decree,
otherwise than as set forth or contemplated in the Prospectus
or (ii) since such date there shall not have been any change
in the capital stock or long-term debt of the Company or any
of its subsidiaries or any change, or any development
involving a prospective change, in or affecting the business,
management, financial position, stockholders' equity or
results of operations of the Company and its subsidiaries
taken as a whole, otherwise than as set forth or contemplated
in the Prospectus, the effect of which, in any such case
described in clause (i) or (ii), is, in the judgment of the
Representatives, so material and adverse as to make it
impracticable or inadvisable to proceed with the public
offering or the delivery of the Stock being delivered on such
Delivery Date on the terms and in the manner contemplated in
the Prospectus.
(m) Subsequent to the execution and delivery of this
Agreement (i) no downgrading shall have occurred in the
rating accorded the Company's debt securities by any
"nationally recognized statistical rating organization," as
that term is defined by the Commission for purposes of Rule
436(g)(2) of the Rules and Regulations and (ii) no such
organization shall have publicly announced that it has under
surveillance or review, with possible negative implications,
its rating of any of the Company's debt securities.
(n) Subsequent to the execution and delivery of this
Agreement there shall not have occurred any of the following:
(i) trading in securities generally on the New York Stock
Exchange or the American Stock Exchange or in the
over-the-counter market, or trading in any securities of the
Company on any exchange or in the over-the-counter market,
shall have been suspended or minimum prices shall have been
established on any such exchange or such market by the
Commission, by such exchange or by any other regulatory body
or governmental authority having jurisdiction, (ii) a banking
moratorium shall have been declared by Federal or state
authorities, (iii) the United States shall have become
engaged in hostilities, there shall have been an escalation
in hostilities involving the United States or there shall
have been a declaration of a national emergency or war by the
United States or (iv) there shall have occurred such a
material adverse change in general economic, political or
financial conditions (or the effect of international
conditions on the financial markets in the United States
shall be such) as to make it, in the judgment of a majority
in interest of the several U.S. Underwriters,
22
impracticable or inadvisable to proceed with the public
offering or delivery of the Stock being delivered on such
Delivery Date on the terms and in the manner contemplated in
the Prospectus.
(o) The New York Stock Exchange shall have approved
the Stock for listing, subject only to official notice of
issuance and evidence of satisfactory distribution.
(p) The closing under the International Underwriting
Agreement shall have occurred concurrently with the closing
hereunder on the First Delivery Date.
All opinions, letters, evidence and certificates mentioned
above or elsewhere in this Agreement shall be deemed to be in compliance with
the provisions hereof only if they are in form and substance reasonably
satisfactory to counsel for the U.S. Underwriters.
8. Indemnification and Contribution.
(a) The Company and the Significant Subsidiary,
jointly and severally, shall indemnify and hold harmless each
U.S. Underwriter (including any U.S. Underwriter in its role
as qualified independent underwriter pursuant to the rules of
the National Association of Securities Dealers, Inc.), its
officers and employees and each person, if any, who controls
any U.S. Underwriter within the meaning of the Securities
Act, from and against any loss, claim, damage or liability,
joint or several, or any action in respect thereof
(including, but not limited to, any loss, claim, damage,
liability or action relating to purchases and sales of
Stock), to which that U.S. Underwriter, officer, employee or
controlling person may become subject, under the Securities
Act or otherwise, insofar as such loss, claim, damage,
liability or action arises out of, or is based upon, (i) any
untrue statement or alleged untrue statement of a material
fact contained in any Preliminary Prospectus, the
Registration Statement or the Prospectus or in any amendment
or supplement thereto, (ii) the omission or alleged omission
to state in any Preliminary Prospectus, the Registration
Statement or the Prospectus, or in any amendment or
supplement thereto, or in any Blue Sky Application any
material fact required to be stated therein or necessary to
make the statements therein not misleading or (iii) any act
or failure to act or any alleged act or failure to act by any
U.S. Underwriter in connection with, or relating in any
manner to, the Stock or the offering contemplated hereby, and
which is included as part of or referred to in any loss,
claim, damage, liability or action arising out of or based
upon matters covered by clause (i) or (ii) above (provided
that the Company and the Significant Subsidiary shall not be
liable under this clause (iii) to the extent that it is
determined in a final judgment by a court of competent
jurisdiction that such loss, claim, damage, liability or
action resulted directly from any such acts or failures to
act undertaken or omitted to be taken by such U.S.
Underwriter through its gross negligence or willful
misconduct), and shall reimburse each U.S.
23
Underwriter and each such officer, employee or controlling
person promptly upon demand for any legal or other expenses
reasonably incurred by that U.S. Underwriter, officer,
employee or controlling person in connection with
investigating or defending or preparing to defend against any
such loss, claim, damage, liability or action as such
expenses are incurred; provided, however, that the Company
and the Significant Subsidiary shall not be liable in any
such case to the extent that any such loss, claim, damage,
liability or action arises out of, or is based upon, any
untrue statement or alleged untrue statement or omission or
alleged omission made in any Preliminary Prospectus, the
Registration Statement or the Prospectus, or in any such
amendment or supplement, in reliance upon and in conformity
with written information concerning such U.S. Underwriter
furnished to the Company through the Representatives by or on
behalf of any U.S. Underwriter specifically for inclusion
therein; provided further, that the indemnification contained
in this paragraph (a) with respect to the Preliminary
Prospectus shall not inure to the benefit of any U.S.
Underwriter (or to the benefit of any officers or employees
of any U.S. Underwriter or of any person controlling such
U.S. Underwriter) on account of any such loss, claim, damage,
liability or action arising from the sale of Stock by such
U.S. Underwriter to any person if the untrue statement or
alleged untrue statement or omission or alleged omission of a
material fact contained in the Preliminary Prospectus was
corrected in the Prospectus and the U.S. Underwriter sold
Stock to that person without sending or giving at or prior to
the written confirmation of such sale, a copy of the
Prospectus (as then amended or supplemented) if the Company
has previously furnished sufficient copies thereof to the
U.S. Underwriter on a timely basis to permit such sending or
giving which information consists solely of the information
specified in Section 8(e). The foregoing indemnity agreement
is in addition to any liability which the Company or the
Significant Subsidiary may otherwise have to any U.S.
Underwriter or to any officer, employee or controlling person
of that U.S. Underwriter.
(b) Each U.S. Underwriter, severally and not
jointly, shall indemnify and hold harmless the Company, its
officers and employees, each of its directors, and each
person, if any, who controls the Company within the meaning
of the Securities Act, from and against any loss, claim,
damage or liability, joint or several, or any action in
respect thereof, to which the Company or any such director,
officer or controlling person may become subject, under the
Securities Act or otherwise, insofar as such loss, claim,
damage, liability or action arises out of, or is based upon,
(i) any untrue statement or alleged untrue statement of a
material fact contained (A) in any Preliminary Prospectus,
the Registration Statement or the Prospectus or in any
amendment or supplement thereto, or (B) in any Blue Sky
Application or (ii) the omission or alleged omission to state
in any Preliminary Prospectus, the Registration Statement or
the Prospectus, or in any amendment or supplement thereto, or
in any Blue Sky Application any material
24
fact required to be stated therein or necessary to make the
statements therein not misleading, but in each case only to
the extent that the untrue statement or alleged untrue
statement or omission or alleged omission was made in
reliance upon and in conformity with written information
concerning such U.S. Underwriter furnished to the Company
through the Representatives by or on behalf of that U.S.
Underwriter specifically for inclusion therein, and shall
reimburse the Company and any such director, officer or
controlling person for any legal or other expenses reasonably
incurred by the Company or any such director, officer or
controlling person in connection with investigating or
defending or preparing to defend against any such loss,
claim, damage, liability or action as such expenses are
incurred. The foregoing indemnity agreement is in addition to
any liability which any U.S. Underwriter may otherwise have
to the Company or any such director, officer, employee or
controlling person.
(c) Promptly after receipt by an indemnified party
under this Section 8 of notice of any claim or the
commencement of any action, the indemnified party shall, if a
claim in respect thereof is to be made against the
indemnifying party under this Section 8, notify the
indemnifying party in writing of the claim or the
commencement of that action; provided, however, that the
failure to notify the indemnifying party shall not relieve it
from any liability which it may have under this Section 8
except to the extent it has been materially prejudiced by
such failure and, provided further, that the failure to
notify the indemnifying party shall not relieve it from any
liability which it may have to an indemnified party otherwise
than under this Section 8. If any such claim or action shall
be brought against an indemnified party, and it shall notify
the indemnifying party thereof, the indemnifying party shall
be entitled to participate therein and, to the extent that it
wishes, jointly with any other similarly notified
indemnifying party, to assume the defense thereof with
counsel reasonably satisfactory to the indemnified party.
After notice from the indemnifying party to the indemnified
party of its election to assume the defense of such claim or
action, the indemnifying party shall not be liable to the
indemnified party under this Section 8 for any legal or other
expenses subsequently incurred by the indemnified party in
connection with the defense thereof other than reasonable
costs of investigation; provided, however, any indemnified
party shall have the right to employ separate counsel in any
such action and to participate in the defense thereof but the
fees and expenses of such counsel shall be at the expense of
the indemnified party unless (i) the employment thereof has
been specifically authorized by the indemnifying party in
writing, (ii) such indemnified party shall have been advised
by such counsel that there may be one or more legal defenses
available to it which are different from or additional to
those available to the indemnifying party and in the
reasonable judgment of such counsel, it is advisable for such
indemnified party to employ separate counsel or (iii) the
indemnifying party has failed to assume the defense of such
action and employ counsel reasonably satisfactory to the
indemnified party, in which case, if
25
such indemnified party notifies the indemnifying party in
writing that it elects to employ separate counsel at the
expense of the indemnifying party shall not, in connection
with any one such action or separate but substantially
similar or related actions in the same jurisdiction arising
out of the same general allegations or circumstances, be
liable for the reasonable fees and expenses of more than one
separate firm of attorneys (in addition to one local counsel)
at any time for all such indemnified parties, which firm
shall be designated in writing by ▇▇▇▇▇▇ Brothers Inc., if
the indemnified parties under this Section 8 consist of any
U.S. Underwriters or any of their respective officers,
employees or controlling persons, or by the Company, if the
indemnified parties under this Section consist of the Company
or any of the Company's directors, officers, employees or
controlling persons. No indemnifying party shall (i) without
the prior written consent of the indemnified parties (which
consent shall not be unreasonably withheld), settle or
compromise or consent to the entry of any judgment with
respect to any pending or threatened claim, action, suit or
proceeding in respect of which indemnification or
contribution may be sought hereunder (whether or not the
indemnified parties are actual or potential parties to such
claim or action) unless such settlement, compromise or
consent includes an unconditional release of each indemnified
party from all liability arising out of such claim, action,
suit or proceeding, or (ii) be liable for any settlement of
any such action effected without its written consent (which
consent shall not be unreasonably withheld), but if settled
with the consent of the indemnifying party or if there be a
final judgment of the plaintiff in any such action, the
indemnifying party agrees to indemnify and hold harmless any
indemnified party from and against any loss or liability by
reason of such settlement or judgment.
(d) If the indemnification provided for in this
Section 8 shall for any reason be unavailable to or
insufficient to hold harmless an indemnified party under
Section 8(a) or 8(b) in respect of any loss, claim, damage or
liability, or any action in respect thereof, referred to
therein, then each indemnifying party shall, in lieu of
indemnifying such indemnified party, contribute to the amount
paid or payable by such indemnified party as a result of such
loss, claim, damage or liability, or action in respect
thereof, (i) in such proportion as shall be appropriate to
reflect the relative benefits received by the Company, the
Significant Subsidiary on the one hand and the U.S.
Underwriters on the other from the offering of the Stock or
(ii) if the allocation provided by clause (i) above is not
permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits
referred to in clause (i) above but also the relative fault
of the Company, the Significant Subsidiary, on the one hand
and the U.S. Underwriters on the other with respect to the
statements or omissions which resulted in such loss, claim,
damage or liability, or action in respect thereof, as well as
any other relevant equitable considerations. The relative
benefits received by the Company, the Significant Subsidiary,
on the one hand and the U.S.
26
Underwriters on the other with respect to such offering shall
be deemed to be in the same proportion as the total net
proceeds from the offering of the Stock purchased under this
Agreement (before deducting expenses) received by the
Company, the Significant Subsidiary, on the one hand, and the
total underwriting discounts and commissions received by the
U.S. Underwriters with respect to the shares of the Stock
purchased under this Agreement, on the other hand, bear to
the total gross proceeds from the offering of the shares of
the Stock under this Agreement, in each case as set forth in
the table on the cover page of the Prospectus. The relative
fault shall be determined by reference to whether the untrue
or alleged untrue statement of a material fact or omission or
alleged omission to state a material fact relates to
information supplied by the Company, the Significant
Subsidiary, or the U.S. Underwriters, the intent of the
parties and their relative knowledge, access to information
and opportunity to correct or prevent such statement or
omission. For purposes of the preceding two sentences, the
net proceeds deemed to be received by the Company shall be
deemed to be also for the benefit of the Significant
Subsidiary and information supplied by the Company shall also
be deemed to have been supplied by the Significant
Subsidiary. The Company, the Significant Subsidiary and the
U.S. Underwriters agree that it would not be just and
equitable if contributions pursuant to this Section were to
be determined by pro rata allocation (even if the U.S.
Underwriters were treated as one entity for such purpose) or
by any other method of allocation which does not take into
account the equitable considerations referred to herein. The
amount paid or payable by an indemnified party as a result of
the loss, claim, damage or liability, or action in respect
thereof, referred to above in this Section shall be deemed to
include, for purposes of this Section 8(d), any legal or
other expenses reasonably incurred by such indemnified party
in connection with investigating or defending any such action
or claim. Notwithstanding the provisions of this Section
8(d), no U.S. Underwriter shall be required to contribute any
amount in excess of the amount by which the total price at
which the Stock underwritten by it and distributed to the
public was offered to the public exceeds the amount of any
damages which such U.S. Underwriter has otherwise paid or
become liable to pay by reason of any untrue or alleged
untrue statement or omission or alleged omission. No person
guilty of fraudulent misrepresentation (within the meaning of
Section 8(e) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such
fraudulent misrepresentation. The U.S. Underwriters'
obligations to contribute as provided in this Section 8(d)
are several in proportion to their respective underwriting
obligations and not joint.
(e) The U.S. Underwriters severally confirm and the
Company and the Significant Subsidiary acknowledge that the
statements with respect to the public offering of the Stock
by the U.S. Underwriters and the last sentence of the third
paragraph on the cover page of, the legend concerning
stabilization on page (i) of,
27
and the fourth, eighth, tenth, sixteenth, twenty-second,
twenty-third and twenty-fourth paragraphs and the
stabilization language in paragraphs eleven through fourteen
under the caption "Underwriting" in, the Prospectus are
correct and constitute the only information concerning such
U.S. Underwriters furnished in writing to the Company by or
on behalf of the U.S. Underwriters specifically for inclusion
in the Registration Statement and the Prospectus.
9. Defaulting U.S. Underwriters.
If, on either Delivery Date, any U.S. Underwriter defaults in
the performance of its obligations under this Agreement, the remaining
non-defaulting U.S. Underwriters shall be obligated to purchase the Stock which
the defaulting U.S. Underwriter agreed but failed to purchase on such Delivery
Date in the respective proportions which the number of shares of the Firm Stock
set opposite the name of each remaining non-defaulting U.S. Underwriter in
Schedule 1 hereto bears to the total number of shares of the Firm Stock set
opposite the names of all the remaining non-defaulting U.S. Underwriters in
Schedule 1 hereto; provided, however, that the remaining non-defaulting U.S.
Underwriters shall not be obligated to purchase any of the Stock on such
Delivery Date if the total number of shares of the Stock which the defaulting
U.S. Underwriter or U.S. Underwriters agreed but failed to purchase on such
date exceeds 9.09% of the total number of shares of the Stock to be purchased
on such Delivery Date, and any remaining non-defaulting U.S. Underwriter shall
not be obligated to purchase more than 110% of the number of shares of the
Stock which it agreed to purchase on such Delivery Date pursuant to the terms
of Section 2. If the foregoing maximums are exceeded, the remaining
non-defaulting U.S. Underwriters, or those other underwriters satisfactory to
the Representatives who so agree, shall have the right, but shall not be
obligated, to purchase, in such proportion as may be agreed upon among them,
all the Stock to be purchased on such Delivery Date. If the remaining U.S.
Underwriters or other underwriters satisfactory to the Representatives do not
elect to purchase the shares which the defaulting U.S. Underwriter or U.S.
Underwriters agreed but failed to purchase on such Delivery Date, this
Agreement (or, with respect to the Second Delivery Date, the obligation of the
U.S. Underwriters to purchase, and of the Company to sell, the Option Stock)
shall terminate without liability on the part of any non-defaulting U.S.
Underwriter or the Company, except that the Company and the Significant
Subsidiary will continue to be liable for the payment of expenses to the extent
set forth in Sections 6 and 11. As used in this Agreement, the term "U.S.
Underwriter" includes, for all purposes of this Agreement unless the context
requires otherwise, any party not listed in Schedule 1 hereto who, pursuant to
this Section 9, purchases Firm Stock which a defaulting U.S. Underwriter agreed
but failed to purchase.
Nothing contained herein shall relieve a defaulting U.S.
Underwriter of any liability it may have to the Company for damages caused by
its default. If other underwriters are obligated or agree to purchase the Stock
of a defaulting or withdrawing U.S. Underwriter, either the Representatives or
the Company may postpone the Delivery Date for up to seven full business days
in order to effect any changes that in the opinion of counsel for the Company
or
28
counsel for the U.S. Underwriters may be necessary in the Registration
Statement, the Prospectus or in any other document or arrangement.
10. Termination. The obligations of the U.S. Underwriters
hereunder may be terminated by the Representatives by notice given to and
received by the Company prior to delivery of and payment for the Firm Stock if,
prior to that time, any of the events described in Sections 7(l), 7(m) or 7(n),
shall have occurred or if the U.S. Underwriters shall decline to purchase the
Stock for any reason permitted under this Agreement.
11. Reimbursement of U.S. Underwriters' Expenses. If (a) the
Company shall fail to tender the Stock for delivery to the U.S. Underwriters by
reason of any failure, refusal or inability on the part of the Company to
perform any agreement on its part to be performed, or because any other
condition of the U.S. Underwriters' obligations hereunder required to be
fulfilled by the Company is not fulfilled, the Company and the Significant
Subsidiary will reimburse the U.S. Underwriters for all reasonable
out-of-pocket expenses (including fees and disbursements of counsel) incurred
by the U.S. Underwriters in connection with this Agreement and the proposed
purchase of the Stock, and upon demand the Company and the Significant
Subsidiary shall pay the full amount thereof to the Representative(s). If this
Agreement is terminated pursuant to Section 9 by reason of the default of one
or more U.S. Underwriters, the Company and the Significant Subsidiary shall not
be obligated to reimburse any defaulting U.S. Underwriter on account of those
expenses.
12. Notices, etc. All statements, requests, notices and
agreements hereunder shall be in writing, and:
(a) if to the U.S. Underwriters, shall be delivered
or sent by mail, telex or facsimile transmission to ▇▇▇▇▇▇
Brothers Inc., Three World Financial Center, New York, New
York 10285, Attention: Syndicate Department (Fax:
212-526-6588), with a copy, in the case of any notice
pursuant to Section 8(c), to the Director of Litigation,
Office of the General Counsel, ▇▇▇▇▇▇ Brothers Inc., ▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇;
(b) if to the Company or to the Significant
Subsidiary, shall be delivered or sent by mail, telex or
facsimile transmission to the address of the Company set
forth in the Registration Statement, Attention: ▇▇▇▇▇▇▇▇▇▇▇
▇. ▇▇▇▇▇▇▇ (Fax: ▇▇▇-▇▇▇-▇▇▇▇);
provided, however, that any notice to an U.S. Underwriter pursuant to Section
8(c) shall be delivered or sent by mail, telex or facsimile transmission to
such U.S. Underwriter at its address set forth in its acceptance telex to the
Representatives, which address will be supplied to any other party hereto by
the Representatives upon request. Any such statements, requests, notices or
agreements shall take effect at the time of receipt thereof. The Company shall
be entitled to act and rely upon any request, consent, notice or agreement
given or made on behalf of the U.S. Underwriters by ▇▇▇▇▇▇ Brothers Inc. on
behalf of the Representatives.
29
13. Persons Entitled to Benefit of Agreement. This Agreement
shall inure to the benefit of and be binding upon the U.S. Underwriters, the
Company, the Significant Subsidiary, and their respective successors. This
Agreement and the terms and provisions hereof are for the sole benefit of only
those persons, except that (A) the representations, warranties, indemnities and
agreements of the Company contained in this Agreement shall also be deemed to
be for the benefit of the person or persons, if any, who control any U.S.
Underwriter within the meaning of Section 15 of the Securities Act and for the
benefit of each International Manager (and controlling persons thereof) who
offers or sells any shares of Common Stock in accordance with the terms of the
Agreement Between U.S. Underwriters and International Managers and (B) the
indemnity agreement of the U.S. Underwriters contained in Section 8(c) of this
Agreement shall be deemed to be for the benefit of directors of the Company,
officers of the Company who have signed the Registration Statement and any
person controlling the Company within the meaning of Section 15 of the
Securities Act. Nothing in this Agreement is intended or shall be construed to
give any person, other than the persons referred to in this Section 13, any
legal or equitable right, remedy or claim under or in respect of this Agreement
or any provision contained herein.
14. Survival. The respective indemnities, representations,
warranties and agreements of the Company, the Significant Subsidiary and the
U.S. Underwriters contained in this Agreement or made by or on behalf on them,
respectively, pursuant to this Agreement, shall survive the delivery of and
payment for the Stock and shall remain in full force and effect, regardless of
any investigation made by or on behalf of any of them or any person controlling
any of them.
15. Definition of the Terms "Business Day" and "Subsidiary."
For purposes of this Agreement, (a) "business day" means each Monday, Tuesday,
Wednesday, Thursday or Friday which is not a day on which banking institutions
in New York are generally authorized or obligated by law or executive order to
close and (b) "subsidiary" has the meaning set forth in Rule 405 of the Rules
and Regulations.
16. Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF NEW YORK.
17. Counterparts. This Agreement may be executed in one or
more counterparts and, if executed in more than one counterpart, the executed
counterparts shall each be deemed to be an original but all such counterparts
shall together constitute one and the same instrument.
18. Headings. The headings herein are inserted for
convenience of reference only and are not intended to be part of, or to affect
the meaning or interpretation of, this Agreement.
[Signature pages follow]
30
If the foregoing correctly sets forth the agreement among the
Company, the Significant Subsidiary and the U.S. Underwriters, please indicate
your acceptance in the space provided for that purpose below.
Very truly yours,
L-3 COMMUNICATIONS HOLDINGS, INC.
By
----------------------------------
Name:
Title:
L-3 COMMUNICATIONS CORPORATION,
the Significant Subsidiary
By
----------------------------------
Name:
Title:
Accepted:
▇▇▇▇▇▇ BROTHERS INC.
BEAR, ▇▇▇▇▇▇▇ & CO. INC.
CREDIT SUISSE FIRST BOSTON CORPORATION
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & CO. INCORPORATED
▇.▇. ▇▇▇▇▇▇▇▇▇, TOWBIN
For themselves and as Representatives
of the several U.S. Underwriters named
in Schedule 1 hereto
By ▇▇▇▇▇▇ BROTHERS INC.
By
---------------------------
Authorized Representative
SCHEDULE 1
Number of
U.S. Underwriters Shares
----------------- ------
▇▇▇▇▇▇ Brothers Inc.....................................
Bear, ▇▇▇▇▇▇▇ & Co. Inc.................................
Credit Suisse First Boston Corporation .................
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated ......................
▇.▇. ▇▇▇▇▇▇▇▇▇, Towbin..................................
----------
Total
==========
LOCK-UP LETTER AGREEMENT
▇▇▇▇▇▇ BROTHERS INC.
BEAR, ▇▇▇▇▇▇▇ & CO. INC.
CREDIT SUISSE FIRST BOSTON CORPORATION
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & CO. INCORPORATED
▇.▇. ▇▇▇▇▇▇▇▇▇, TOWBIN
As Representatives of the
several U.S. underwriters
▇▇▇▇▇▇ BROTHERS INTERNATIONAL (EUROPE)
BEAR, ▇▇▇▇▇▇▇ INTERNATIONAL LIMITED
CREDIT SUISSE FIRST BOSTON (EUROPE) LIMITED
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & CO. INTERNATIONAL LIMITED
▇.▇. ▇▇▇▇▇▇▇▇▇, TOWBIN
As Representatives of the
several international managers
c/▇ ▇▇▇▇▇▇ BROTHERS INC.
Three World Financial Center
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Dear Sirs:
The undersigned understands that you and certain other firms propose
to enter into underwriting agreements (the "Underwriting Agreements") providing
for the purchase by you and such other firms (collectively, the "Underwriters")
of shares (the "Shares") of Common Stock, par value $.01 per share (the "Common
Stock"), of L-3 Communications Holdings, Inc. (the "Company") and that the
Underwriters propose to reoffer the Shares to the public (the "Offering").
In consideration of the execution of the Underwriting Agreements by
the Underwriters, and for other good and valuable consideration, the
undersigned hereby irrevocably agrees that, without the prior written consent
of ▇▇▇▇▇▇ Brothers Inc., the undersigned will not, directly or indirectly, (1)
offer for sale, sell, or otherwise dispose of (or enter into any transaction or
device that is designed to, or could be expected to, result in the disposition
by any person at any time in the future of) any shares of Common Stock
(including, without limitation, shares of Common Stock that may be deemed to be
beneficially owned by the undersigned in accordance with the rules and
regulations of the Securities and Exchange Commission and shares of Common
Stock that may be issued upon exercise of any option or warrant) or securities
convertible into or exchangeable or exercisable for Common Stock (other than
the Shares) owned by the undersigned on the date of execution of this Lock-Up
Letter Agreement or on the date of the completion of the Offering, or (2) enter
into any swap or other derivatives transaction that
transfers to another, in whole or in part, any of the economic benefits or
risks of ownership of such shares of Common Stock, whether any such transaction
described in clause (1) or (2) above is to be settled by delivery of Common
Stock or other securities, in cash or otherwise, for a period of 180 days after
the date of the final Prospectus relating to the Offering except in each case
for transactions by any person other than the Company relating to shares of
Common Stock or other securities convertible into or exchangeable or
exercisable for Common Stock acquired in open market transactions after the
completion of the Offering.
In furtherance of the foregoing, the Company and its Transfer Agent
are hereby authorized to decline to make any transfer of securities if such
transfer would constitute a violation or breach of this Lock-Up Letter
Agreement.
It is understood that, if the Company notifies you that it does not
intend to proceed with the Offering, if the Underwriting Agreement does not
become effective, or if the Underwriting Agreement (other than the provisions
thereof which survive termination) shall terminate or be terminated prior to
payment for and delivery of the Shares, we will be released from our
obligations under this Lock-Up Letter Agreement.
The undersigned understands that the Company and the Underwriters will
proceed with the Offering in reliance on this Lock-Up Letter Agreement.
The undersigned hereby represents and warrants that the undersigned
has full power and authority to enter into this Lock-Up Letter Agreement and
that, upon request, the undersigned will execute any additional documents
necessary in connection with the enforcement hereof. Any obligations of the
undersigned shall be binding upon the heirs, personal representatives,
successors and assigns of the undersigned.
Very truly yours,
By:
---------------------------
Name:
Title:
Dated:
---------------