SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
----------------------------------
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
January 23, 1997
-----------------------------------
Date of report
PRIMEX TECHNOLOGIES, INC.
------------------------------------------------------
(Exact name of registrant as specified in its charter)
Virginia 0-28942 06-1458069
--------------- ------------ ----------------
(State or other (Commission (I.R.S. Employer
jurisdiction of File Number) Identification
organization) Number)
10101 Ninth Street North, St. Petersburg, FL 33716-3807
-------------------------------------------------------
(Address of principal executive offices) (Zip code)
(813) 578-8100
----------------------------
(Registrant's telephone
number, including area code)
Page 1 of 2
Exhibit Index is on Page 2
<PAGE>
INFORMATION TO BE INCLUDED IN THE REPORT.
Item 5. Other Events.
On December 31, 1996, Olin Corporation ("Olin") distributed to its common
shareholders one share of common stock of Primex Technologies, Inc.'s
("Primex") for every ten shares of Olin common stock held as of the record
date of December 19, 1996. Primex Technologies, Inc. began business as a
separate entity on January 1, 1997. Primex stock certificates were mailed to
shareholders commencing on January 6, 1997.
Item 7. Financial Statements, Pro Forma Financial Information, and Exhibits.
(c) Exhibits.
Exhibit
No. Description
2 Distribution Agreement dated December 30, 1996, between Primex
Technologies, Inc. and Olin Corporation.
3.1 Amended and Restated Articles of Incorporation of Primex
Technologies, Inc. effective December 31, 1996.
3.2 By-laws of Primex Technologies, Inc. as amended December 31, 1996.
10.1 Distribution Agreement dated as of December 30, 1996 between
Primex Technologies, Inc. and Olin Corporation. (filed as
Exhibit 2 hereto).
10.2 Technology Transfer and License Agreement dated December 30, 1996
between Primex Technologies, Inc. and Olin Corporation.
10.3 Tax Sharing Agreement dated December 31, 1996 between Primex
Technologies, Inc. and Olin Corporation.
10.4 Powder Supply Requirements Agreement dated December 31, 1996
between Primex Technologies, Inc. and Olin Corporation.
10.5 Assignment of Ball Powder (R) Trademark to Primex and
Limited License to Olin dated December 30, 1996 between Primex
Technologies, Inc. and Olin Corporation.
10.6 Assumption of Liabilities and Indemnity Agreement dated
December 31, 1996 between Primex Technologies, Inc. and Olin
Corporation.
10.7 Covenant Not To Compete Agreement dated December 31, 1996 between
Primex Technologies, Inc. and Olin Corporation.
10.8 Assignment of Raufoss Agreements to Primex and Sublicense to Olin
for Small Caliber Ammunition dated December 30, 1996 between Primex
Technologies, Inc. and Olin Corporation.
10.9 Form of Executive Agreement
Page 2 of 4
Exhibit Index is on Page 4
<PAGE>
10.10 Credit Agreement dated as of December 23, 1996 among Primex
Technologies, Inc., Olin Corporation, Morgan Guaranty Trust Co.
of New York, as Agent, and various financial institutions.
10.11 Trade Name License Agreement dated December 31, 1996
between Primex Technologies, Inc. and Olin Corporation.
10.12 Transition Services Agreement dated December 31, 1996 between
Primex Technologies, Inc. and Olin Corporation.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on its
behalf by the undersigned hereunto duly authorized.
PRIMEX TECHNOLOGIES, INC.
By: George H. Pain
----------------------
George H. Pain
Title: Vice President
Date: January 23, 1997
Page 3 of 4
Exhibit Index is on Page 4.
<PAGE>
EXHIBIT INDEX
Exhibit
No. Exhibit
- ------- -------
2 Distribution Agreement dated December 30, 1996, between Primex
Technologies, Inc. and Olin Corporation.
3.1 Amended and Restated Articles of Incorporation of Primex
Technologies, Inc. effective December 31, 1996.
3.2 By-laws of Primex Technologies, Inc. as amended December 31, 1996.
10.1 Distribution Agreement dated as of December 30, 1996 between
Primex Technologies, Inc. and Olin Corporation. (filed as
Exhibit 2 hereto).
10.2 Technology Transfer and License Agreement dated December 30, 1996
between Primex Technologies, Inc. and Olin Corporation.
10.3 Tax Sharing Agreement dated December 31, 1996 between Primex
Technologies, Inc. and Olin Corporation.
10.4 Powder Supply Requirements Agreement dated December 31, 1996
between Primex Technologies, Inc. and Olin Corporation.
10.5 Assignment of Ball Powder (R) Trademark to Primex and
Limited License to Olin dated December 30, 1996 between Primex
Technologies, Inc. and Olin Corporation.
10.6 Assumption of Liabilities and Indemnity Agreement dated
December 31, 1996 between Primex Technologies, Inc. and Olin
Corporation.
10.7 Covenant Not To Compete Agreement dated December 31, 1996 between
Primex Technologies, Inc. and Olin Corporation.
10.8 Assignment of Raufoss Agreements to Primex and Sublicense to Olin
for Small Caliber Ammunition dated December 30, 1996 between
Primex Technologies, Inc. and Olin Corporation.
10.9 Form of Executive Agreement
10.10 Credit Agreement dated as of December 23, 1996 among Primex
Technologies, Inc., Olin Corporation, Morgan Guaranty Trust Co.
of New York, as Agent, and various financial institutions.
10.11 Trade Name License Agreement dated December 31, 1996 between
Primex Technologies, Inc. and Olin Corporation.
10.12 Transition Services Agreement dated December 31, 1996 between
Primex Technologies, Inc. and Olin Corporation.
Page 4 of 4
Exhibit Index is on Page 4.
Exhibit 2
DISTRIBUTION AGREEMENT
dated as of December 30, 1996,
between OLIN CORPORATION, a
Virginia corporation ("Olin"),
and PRIMEX TECHNOLOGIES, INC.,
a Virginia corporation
("Primex").
The Board of Directors of Olin has determined to distribute to the
holders of shares of Common Stock, par value $1 per share, of Olin (the "Olin
Common Stock") all the outstanding shares of Common Stock, par value $1 per
share, of Primex (the "Primex Common Shares"). It is desirable to allocate and
assign responsibility for various matters affecting the activities of Primex and
to set forth the principal corporate transactions required to effect such
distribution and other agreements that will govern certain other matters
following the distribution.
NOW, THEREFORE, in consideration of the mutual agreements, provisions
and covenants contained in this Agreement, the parties hereby agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01. GENERAL. As used in this Agreement, the following
terms shall have the following meanings (such meanings to be equally applicable
to both the singular and plural forms of the terms defined):
"Action" shall mean any claim, action, suit, arbitration, inquiry,
proceeding or investigation by or before any court, any governmental or other
regulatory or administrative official, agency, body or commission or any
arbitration tribunal, including any claims or contract disputes concerning any
governmental contract.
"Affiliate" shall mean, when used with respect to a specified person,
another person that directly, or indirectly through one or more intermediaries,
controls or is controlled by or is under common control with the person
specified.
"Agent" shall mean ChaseMellon Shareholder Services LLC, as transfer
agent for Olin and Primex.
"Ancillary Agreements" shall mean all of the written agreements,
instruments, understandings, assignments or other arrangements (other than this
Agreement) entered into in connection with the transactions contemplated hereby,
including, without limitation, (i) the Tax Sharing Agreement, (ii) the Powder
Supply Requirements Agreement, (iii) the Browning Exclusive Distributorship
Agreement, (iv) the Australia Agency Agreement, (v) the Covenant Not to Compete
Agreement, (vi) the Technology Transfer and License Agreement, (vii) the
Component Supply Agreement, (viii) the Indemnity Agreement, (ix) the Transition
Services Agreement, (x) the Raufoss Assignment, (xi) the Trade Name License
Agreement, (xii) the Ball Powder Assignment and (xiii) the Powder Supply Pricing
Agreement.
"Australia Agency Agreement" shall mean the Australia Agency Agreement
dated as of December 31, 1996, between Primex and Olin Australia Ltd.
"Ball Powder Assignment" shall mean the Assignment of Ball Powder
Trademark to Primex and Limited License to Olin Agreement dated as of
December 30, 1996, between Olin and Primex.
"Browning Exclusive Distributorship Agreement" shall mean the Browning
Exclusive Distributorship Agreement dated as of December 31, 1996, between Olin
and Primex.
"Claims Administration" shall mean (i) the processing of claims made
under Company Policies, including the reporting of claims and occurrences to the
appropriate insurance carriers and the collection of the proceeds of Company
Policies and (ii) in the case of the Primex Business, the reporting to Olin of
any losses or claims which may cause the per-occurrence deductible or self-
insured retention or limits of any Company Policy to be exceeded.
"Code" shall mean the Internal Revenue Code of 1986, as amended, and
the Treasury regulations promulgated thereunder, including any successor
legislation.
"Commission" shall have the meaning set forth in Section 3.02(b).
"Company Policies" shall mean all Policies, current or past, under
which Olin or any subsidiary, affiliate or predecessor of Olin is a named
insured.
"Component Supply Agreement" shall mean the Component Supply Agreement
dated as of December 31, 1996, between Olin and Primex.
"Conveyancing and Assumption Instruments" shall mean, collectively,
the various agreements, instruments and other documents to be entered into to
effect the transfer of assets and the assumption of Liabilities in the manner
contemplated by this Agreement.
"Covenant Not to Compete Agreement" shall mean the Covenant
Not to Compete Agreement dated as of December 31, 1996, between Olin and Primex.
"Credit Agreement" shall mean the Credit Agreement among Olin, Primex
Morgan Guaranty Trust Company of New York, as Agent, and the several banks named
therein which will be assumed by Primex prior to the Distribution Date pursuant
to Section 2.02 hereof and which is intended to provide financing and working
capital for Primex after the Distribution.
"Distribution" shall mean the distribution to holders of record of
shares of Olin Common Stock as of the Distribution Record Date of the Primex
Common Shares owned by Olin on the basis of one Primex Common Share for every
10 shares of Olin Common Stock. The Distribution shall be deemed effective as
of the Effective Time.
"Distribution Date" shall mean January 6, 1997, or such other date as
may hereafter be determined by Olin's Board of Directors as the date on which
certificates representing the Common Shares shall be distributed by the Agent to
holders of record of shares of Olin Common Stock on the Distribution Record
Date.
"Distribution Record Date" shall mean December 19, 1996, or such other
date as may hereafter be determined by Olin's Board of Directors as the record
date for the Distribution.
"Effective Time" shall mean midnight on December 31, 1996, or such
other date as may hereafter be determined by Olin's Board of Directors as the
date on which the Distribution shall be deemed effective.
"Indemnity Agreement" shall mean the Assumption of Liabilities and
Indemnity Agreement dated as of December 31, 1996, between Olin and Primex.
"Information Statement" shall mean the Information Statement dated
December 9, 1996, sent to the holders of shares of Olin Common Stock in
connection with the Distribution, including any amendment or supplement thereto.
"Insurance Proceeds" shall mean those monies (i) received by an
insured from an insurance carrier or (ii) paid by an insurance carrier on behalf
of an insured, in either case net of any applicable premium adjustment,
retrospectively-rated premium, deductible, retention, or cost of reserve paid or
held by or for the benefit of such insured.
"Insured Claims" shall mean those Liabilities that, individually or in
the aggregate, are covered within the terms and conditions of any Company
Policy, whether or not subject to deductibles, uncollectability or
retrospectively-rated premium adjustments, but only to the extent that such
Liabilities are within applicable Company Policy limits, including aggregates.
"Liabilities" shall mean any and all debts, liabilities and
obligations, absolute or contingent, matured or unmatured, liquidated or
unliquidated, accrued or unaccrued, known or unknown, whenever arising,
including, without limitation, those debts, liabilities and obligations arising
under any law, rule, regulation, Action, threatened Action, order or consent
decree of any court, any governmental or other regulatory or administrative
agency or commission or any award of any arbitration tribunal, and those arising
under any contract, guarantee, commitment or undertaking.
"Management Security Plan" shall mean the Management Security Plan of
Rockcor, Inc., as amended from time to time, and any agreement relating thereto
or any successor plan.
"Olin Business" shall mean the businesses of any division, Subsidiary
or investment of Olin (other than the Primex Business) managed or operated prior
to the Effective Time by any such business entity.
"Olin CEOP Plan" shall mean the Olin Corporation Contributing Employee
Ownership Plan, as in effect at the Effective Time.
"Olin Liabilities" shall mean collectively, (i) all the Liabilities of
Olin and its Subsidiaries under this Agreement and any of the Ancillary
Agreements and (ii) all the Liabilities of the parties hereto or their
respective Subsidiaries (whenever arising whether prior to, at or following the
Effective Time) arising out of or in connection with or otherwise relating to
the management or conduct before or after the Effective Time of the Olin
Business.
"Olin Pension Plan" shall mean the Olin Corporation Employees Pension
Plan, as in effect at the Effective Time.
"Olin Supplemental Plans" shall mean, collectively, the Olin
Corporation Senior Executive Benefit Plan, the Olin Deferral Benefit Plan, the
Olin Supplementary Pension Plan and the Olin Supplemental Contributing Employee
Ownership Plan, each as in effect on the Distribution Date.
"person" shall mean any natural person, corporation, business trust,
joint venture, association, company, partnership or government, or any agency or
political subdivision thereof.
"Policies" shall mean insurance policies and insurance contracts of
any kind (other than life and benefits policies or contracts), including,
without limitation, primary, excess and umbrella policies, commercial general
liability policies, fiduciary liability, environmental impairment, director and
officer, health, automobile, aircraft, property and casualty, workers'
compensation and employee dishonesty insurance policies, bonds and self-
insurance and captive insurance company arrangements, together with the rights,
benefits and privileges thereunder.
"Powder Supply Pricing Agreement" shall mean the Powder Supply Pricing
Agreement dated as of December 31, 1996, between Olin and Primex.
"Powder Supply Requirements Agreement" shall mean the Powder Supply
Requirements Agreement dated as of December 31, 1996, between Olin and Primex.
"PRIME" shall mean the Primex Technologies, Inc. Retirement Investment
Management Experience Plan to be adopted by Primex effective as of the Effective
Time and referred to in the Information Statement.
"Primex Assets" shall mean, collectively, all the rights and assets of
Olin and its Subsidiaries relating to the Primex Business, including, without
limitation, all the outstanding capital stock or other interests of Primex in
Subsidiaries of Primex and the technology, patents, trademarks and other
intellectual property described in the Technology Transfer and License Agreement
and the Ball Powder Assignment.
"Primex Business" shall mean the ordnance and aerospace businesses
heretofore conducted by Olin, other than those businesses set forth on
Exhibit A, and business activities acquired, developed or established by or for
Primex or any of its Subsidiaries after the date of this Agreement.
"Primex Liabilities" shall mean, collectively, (i) all the Liabilities
of Primex and its Subsidiaries under this Agreement and any of the Ancillary
Agreements and (ii) all the Liabilities of the parties hereto or their
respective Subsidiaries (whenever arising whether prior to, at or following the
Effective Time) arising out of or in connection with or otherwise relating to
the management or conduct before or after the Effective Time of the Primex
Business.
"Primex Supplemental Plan" shall mean the nonqualified, unfunded
Supplemental Savings and Retirement Plan or supplemental compensation program to
be adopted by Primex effective as of the Effective Time and referred to in the
Information Statement.
"Raufoss Assignment" shall mean the Assignment of Raufoss Agreements
and Sublicense to Olin for Small Caliber Ammunition dated as of December 30,
1996, between Olin and Primex.
"Subsidiary" shall mean any corporation, partnership or other entity
of which another entity (i) owns, directly or indirectly, ownership interests
sufficient to elect a majority of the Board of Directors (or persons performing
similar functions) (irrespective of whether at the time any other class or
classes of ownership interests of such corporation, partnership or other entity
shall or might have such voting power upon the occurrence of any contingency) or
(ii) is a general partner or an entity performing similar functions (E.G., a
trustee).
"Tax" shall mean all Federal, state, local and foreign taxes and
assessments, including all interest, penalties and additions imposed with
respect to such amounts.
"Tax Sharing Agreement" shall mean the Tax Sharing Agreement dated as
of December 31, 1996, among Olin and Primex.
"Technology Transfer and License Agreement" shall mean the Technology
Transfer and License Agreement dated as of December 30, 1996, between Olin and
Primex.
"Trade Name License Agreement" shall mean the Trade Name License
Agreement dated as of December 31, 1996, between Olin and Primex.
"Transition Services Agreement" shall mean the Transition Services
Agreement dated as of December 31, 1996, between Olin and Primex.
SECTION 1.02. REFERENCES; INTERPRETATION. References to an "Exhibit"
or to a "Schedule" are, unless otherwise specified, to one of the Exhibits or
Schedules attached to this Agreement, and references to a "Section" are, unless
otherwise specified, to one of the Sections of this Agreement.
ARTICLE II
DISTRIBUTION AND OTHER TRANSACTIONS; CERTAIN COVENANTS
SECTION 2.01. THE DISTRIBUTION AND OTHER TRANSACTIONS. (a) CERTAIN
TRANSACTIONS. At or prior to the Effective Time:
(i) Olin shall contribute to Primex the business entities that are to
comprise the Primex Business (to the extent they are not owned by Primex or
any of its Subsidiaries).
(ii) Olin shall, on behalf of itself and its Subsidiaries, transfer
to Primex effective as of the Effective Time all of Olin's and its
Subsidiaries' right, title and interest in the Primex Assets.
(b) STOCK DIVIDEND TO OLIN. At or prior to the Effective Time,
Primex shall issue to Olin as a stock dividend the number of Primex Common
Shares required to effect the Distribution. In connection therewith Olin shall
deliver to Primex for cancellation the share certificate (or certificates)
currently held by it representing Primex Common Shares and shall receive a new
certificate (or certificates) representing the total number of Primex Common
Shares to be owned by Olin after giving effect to such stock dividend.
(c) CHARTER; BY-LAWS. At or prior to the Effective Time, all
necessary action shall have been taken to provide for the adoption of the form
of Amended and Restated Articles of Incorporation and By-laws of Primex
substantially in the forms attached hereto as Exhibits B and C, respectively.
(d) DIRECTORS. At or prior to the Effective Time, Olin, as the sole
shareholder of Primex, shall have taken all necessary action to elect, or cause
to be elected, to the Board of Directors of Primex the individuals identified in
the Information Statement as directors of Primex, such elections to be effective
on or prior to January 1, 1997.
(e) CERTAIN LICENSES AND PERMITS. At or prior to the Effective Time
or as soon as reasonably practicable thereafter, all transferable licenses,
permits and authorizations issued by governmental or regulatory entities which
relate to the Primex Business but which are held in the name of Olin or any of
its Subsidiaries (other than any Subsidiary of Primex), or any of their
respective employees, officers, directors, stockholders, agents, or otherwise,
on behalf of Primex (or its Subsidiaries) shall be duly and validly transferred
by Olin to Primex (or its Subsidiaries).
(f) LEASE AMENDMENTS. At or prior to the Effective Time, amendments
shall be executed to each of the leases to which Olin is a party and which
provide for the lease of real or personal property representing Primex Assets or
relating to the Primex Business which amendments will provide for the
substitution of Primex for Olin as lessee or lessor, as the case may be, and
excuse Olin from any further liabilities or responsibilities with respect
thereto.
(g) TRANSFER OF AGREEMENTS. (i) Olin hereby agrees that at or prior
to the Effective Time or as soon as reasonably practicable thereafter, subject
to the limitations set forth in this Section 2.01(g) and the terms of the
Ancillary Agreements, it will, and it will cause its Subsidiaries (other than
Primex or any of its Subsidiaries) to, assign, transfer and convey to Primex all
of Olin's or such Subsidiary's respective right, title and interest in and to
any and all agreements that, in Olin's sole judgment, relate exclusively to the
Primex Business. Primex hereby agrees that at or prior to the Effective Time or
as soon as reasonably practicable thereafter, subject to the limitations set
forth in this Section 2.01(g), it will, and it will cause its Subsidiaries to,
assign, transfer and convey to Olin all of Primex's or each such Subsidiary's
respective right, title and interest in and to any and all agreements that, in
Olin's sole judgment, relate exclusively to the Olin Business.
(ii) Subject to the provisions of this Section 2.01(g) and the terms
of the Ancillary Agreements, any agreement to which the parties hereto or any of
their Subsidiaries is a party that inures, in Olin's sole judgment, to the
benefit of both the Olin Business and the Primex Business shall be assigned in
part, on or prior to the Effective Time or as soon as reasonably practicable
thereafter, so that each party shall be entitled to the rights and benefits
inuring to its business under such agreement.
(iii) The assignee of any agreement assigned, in whole or in part,
hereunder (an "Assignee"), shall assume and agree to pay, perform, and fully
discharge all obligations of the assignor under such agreement or, in the case
of a partial assignment under paragraph (g)(ii), the assignor's related portion
of such obligations as determined in accordance with the terms of the relevant
agreement, where determinable on the face thereof, and otherwise as determined
in accordance with the practice of the parties prior to the Distribution.
(iv) Notwithstanding anything in this Agreement to the contrary, this
Agreement shall not constitute an agreement to assign any agreement, in whole or
in part, or any rights thereunder if the agreement to assign or attempt to
assign, without the consent of a third party, would constitute a breach thereof
or in any way adversely affect the rights of the Assignee thereof. Until such
consent is obtained, or if an attempted assignment thereof would be ineffective
or would adversely affect the rights of any party hereto so that the Assignee
would not, in fact, receive all such rights, the parties will cooperate with
each other in any arrangement designed to provide for the Assignee the benefits
of, and to permit the Assignee to assume liabilities under, any such agreement.
(h) CONSENTS. The parties hereto shall use commercially reasonable
efforts to obtain required consents to assignment of agreements hereunder.
(i) DELIVERY OF SHARES TO AGENT. At or prior to the Effective Time,
Olin shall deliver to the Agent the share certificate or certificates
representing the Primex Common Shares issued to Olin by Primex, pursuant to
Section 2.01(b) and shall instruct the Agent to distribute, on or as soon as
practicable following the Distribution Date, such Common Shares to holders of
record of shares of Olin Common Stock on the Distribution Record Date as further
contemplated by, and subject to the conditions contained in, the Information
Statement and this Agreement. Primex shall provide all share certificates that
the Agent shall require in order to effect the Distribution.
(j) OTHER TRANSACTIONS. At or prior to the Effective Time, Olin and
Primex shall have consummated those other transactions in connection with the
Distribution that are contemplated by the Information Statement and not
specifically referred to in subparagraphs (a)-(i) above.
SECTION 2.02. FINANCING. Each of the parties hereto shall take all
actions necessary to cause Primex to assume Olin's rights and obligations under
the Credit Agreement immediately prior to the Effective Time, provided that Olin
shall have no obligation to guarantee or otherwise provide credit support or
enhancement for the obligations of Primex under such Credit Agreement.
SECTION 2.03. OPERATIONS IN ORDINARY COURSE. Each of Olin and Primex
agrees that, except as otherwise provided in any Ancillary Agreement or this
Agreement, during the period from the date of this Agreement through the
Effective Time, it will, and will cause their respective Subsidiaries during
such period to, conduct its business in a manner substantially consistent with
current and past operating practices and in the ordinary course, including,
without limitation, with respect to the payment and administration of accounts
payable and the administration of accounts receivable, the purchase of capital
assets and equipment and the management of inventories.
SECTION 2.04. CAPITAL STRUCTURE. Each of Olin and Primex agrees to
use commercially reasonable efforts to achieve both an allocation of
consolidated indebtedness of Olin and a capital structure of Primex which
substantially reflects the capital structure after the Distribution of Primex
set forth in the Information Statement under the heading "Capitalization".
SECTION 2.05. ASSUMPTION AND SATISFACTION OF LIABILITIES. Except as
otherwise specifically set forth in any Ancillary Agreement, from and after the
Effective Time, (i) Olin shall, and shall cause its Subsidiaries to, assume,
pay, perform and discharge all Olin Liabilities, and (ii) Primex shall, and
shall cause its Subsidiaries to, assume, pay, perform and discharge all Primex
Liabilities.
SECTION 2.06. RESIGNATIONS. Olin shall cause all its directors,
officers and employees to resign, effective as of December 31, 1996, from all
positions as officers of Primex or as officers or directors of any Subsidiary of
Primex in which they serve. Primex shall cause all its employees to resign,
effective as of December 31, 1996, from all positions as officers of Olin or as
officers or directors of any Subsidiary of Olin in which they serve.
SECTION 2.07. FURTHER ASSURANCES. In case at any time after the
Effective Time any further action is reasonably necessary or desirable to carry
out the purposes of this Agreement and the Ancillary Agreements, the proper
officers of each party to this Agreement shall take all such necessary action.
Without limiting the foregoing, Olin and Primex shall use commercially
reasonable efforts to obtain all consents and approvals, to enter into all
amendatory agreements and to make all filings and applications that may be
required for the consummation of the transactions contemplated by this Agreement
and the Ancillary Agreements, including, without limitation, all applicable
governmental and regulatory filings and novations.
SECTION 2.08. NO REPRESENTATIONS OR WARRANTIES. Each of the parties
hereto understands and agrees that, except as otherwise expressly provided, no
party hereto is, in this Agreement or in any other agreement or document
contemplated by this Agreement or otherwise, making any representation or
warranty whatsoever, including, without limitation, as to title, value or legal
sufficiency. It is also agreed and understood that all assets either
transferred to or retained by the parties, as the case may be, shall be "as is,
where is" and that (subject to Section 2.07) the party to which such assets are
to be transferred hereunder shall bear the economic and legal risk that any
conveyances of such assets shall prove to be insufficient or that such party's
or any of the Subsidiaries' title to any such assets shall be other than good
and marketable and free from encumbrances. Similarly, each party hereto
understands and agrees that no party hereto is, in this Agreement or in any
other agreement or document contemplated by this Agreement or otherwise,
representing or warranting in any way that the obtaining of any consents or
approvals, the execution and delivery of any amendatory agreements and the
making of any filings or applications contemplated by this Agreement will
satisfy the provisions of any or all applicable agreements or the requirements
of any or all applicable laws or judgments, it being agreed and understood that
the party to which any assets are transferred shall bear the economic and legal
risk that any necessary consents or approvals are not obtained or that any
requirements of laws or judgments are not complied with.
SECTION 2.09. ELIMINATION OF GUARANTEES. Except as otherwise
specified in any Ancillary Agreement, Olin and Primex shall use their
commercially reasonable efforts to have, on or prior to the Effective Time, or
as soon as practicable thereafter, Olin and any of its Subsidiaries removed as
guarantor of or obligor for any Primex Liability or Liabilities, including,
without limitation, in respect of those guarantees set forth on Schedule 2.09.
To the extent that Olin or any of its Subsidiaries cannot be removed as
guarantor of or obligor for any such Primex Liability or Liabilities, Primex
agrees that, notwithstanding any contrary provision contained in any Novation
Agreement referred to in Schedule 2.09, until such Primex Liability or
Liabilities shall have been discharged in full, Primex will take no action, and
will not permit any of its Subsidiaries to take any action, which will have the
effect of increasing the contingent liability or exposure of Olin or any of its
Subsidiaries with respect to such Primex Liability or Liabilities without Olin's
prior written consent; provided however, with respect to any guaranty arising in
connection with any Novation Agreement referred to in Schedule 2.09, Primex may
modify (but not extend) the U.S. Government contracts relating to such Novation
Agreements without Olin's prior consent provided such modification is made in
good faith and is commercially reasonable and does not unreasonably increase
Olin's contingent liability or risk with respect thereto under such Novation
Agreement taking into account the facts and circumstances at the time of the
modification.
SECTION 2.10. WITNESS SERVICES. At all times from and after the
Effective Time, each of Olin and Primex shall use commercially reasonable
efforts to make available to each other, upon reasonable written request, its
and its Subsidiaries' officers, directors, employees and agents as witnesses to
the extent that (i) such persons may reasonably be required in connection with
the prosecution or defense of any Action in which the requesting party may from
time to time be involved and (ii) there is no conflict in the Action between the
requesting party and itself. A party providing witness services to the other
party under this Section shall be entitled to receive from the recipient of such
services, upon the presentation of invoices therefor, payments for such amounts,
relating to supplies, disbursements and other out-of-pocket expenses and direct
and indirect costs of employees who are witnesses, as may be reasonably incurred
in providing such witness services.
SECTION 2.11. CERTAIN POSTDISTRIBUTION TRANSACTIONS. Each of Olin
and Primex agrees that (i) it shall comply with and otherwise not take action
inconsistent with each representation and statement made to Cravath, Swaine &
Moore in connection with such firm's rendering an opinion to Olin and Primex as
to certain tax aspects of the Distribution and (ii) until one year after the
Distribution Date, it will maintain its status as a company engaged in the
active conduct of a trade or business, as defined in Section 355(b) of the Code.
SECTION 2.12. TRANSFERS NOT EFFECTED PRIOR TO EFFECTIVE TIME;
TRANSFERS DEEMED EFFECTIVE AS OF EFFECTIVE TIME. To the extent that any
transfers contemplated by this Article II shall not have been consummated at or
prior to the Effective Time, the parties shall cooperate to effect such
transfers as promptly following the Effective Time as shall be practicable.
Nothing herein shall be deemed to require the transfer of any assets or the
assumption of any Liabilities which by their terms or operation of law cannot be
transferred; PROVIDED, HOWEVER, that the parties hereto and their respective
Subsidiaries shall cooperate to seek to obtain any necessary consents or
approvals for the transfer of all assets and Liabilities contemplated to be
transferred pursuant to this Article II. In the event that any such transfer of
assets or Liabilities has not been consummated, from and after the Effective
Time the party retaining such asset or Liability shall hold such asset in trust
for the use and benefit of the party entitled thereto (at the expense of the
party entitled thereto) or retain such Liability for the account of the party by
whom such Liability is to be assumed pursuant hereto, as the case may be, and
take such other action as may be reasonably requested by the party to whom such
asset is to be transferred, or by whom such Liability is to be assumed, as the
case may be, in order to place such party, insofar as is reasonably possible, in
the same position as would have existed had such asset or Liability been
transferred as contemplated hereby. As and when any such asset or Liability
becomes transferable, such transfer shall be effected forthwith. The parties
agree that, as of the Effective Time, each party hereto shall be deemed to have
acquired complete and sole beneficial ownership over all of the assets, together
with all rights, powers and privileges incident thereto, and shall be deemed to
have assumed in accordance with the terms of this Agreement all of the
Liabilities, and all duties, obligations and responsibilities incident thereto,
which such party is entitled to acquire or required to assume pursuant to the
terms of this Agreement.
SECTION 2.13. ANCILLARY AGREEMENTS. At or prior to the Effective
Time, each of Olin and Primex shall enter into, and/or (where applicable) shall
cause their respective Subsidiaries to enter into, the Ancillary Agreements and
any other agreements in respect of the Distribution reasonably necessary or
appropriate in connection with the transactions contemplated hereby and thereby.
ARTICLE III
ACCESS TO INFORMATION
SECTION 3.01. PROVISION OF CORPORATE RECORDS. (a) After the
Effective Time, upon the prior written request by Primex for specific and
identified agreements, documents, books, records or files including, without
limitation, computer files, microfiche, tape recordings and photographs
(collectively, "Records"), relating to or affecting Primex, Olin shall arrange,
as soon as reasonably practicable following the receipt of such request, for the
provision of appropriate copies of such Records (or the originals thereof if the
party making the request has a reasonable need for such originals) in the
possession of Olin or any of its Subsidiaries, but only to the extent such items
are not already in the possession of the requesting party.
(b) After the Effective Time, upon the prior written request by Olin
for specific and identified Records relating to or affecting Olin, Primex shall
arrange, as soon as reasonably practicable following the receipt of such
request, for the provision of appropriate copies of such Records (or the
originals thereof if the party making the request has a reasonable need for such
originals) in the possession of Primex or any of its Subsidiaries, but only to
the extent such items are not already in the possession of the requesting party.
SECTION 3.02. ACCESS TO INFORMATION. (a) From and after the
Effective Time, Olin and Primex shall afford to the other and its authorized
accountants, counsel and other designated representatives (including
governmental representatives and auditors in connection with governmental claims
or audits) reasonable access during normal business hours, subject to
appropriate restrictions for classified, privileged or confidential information,
to the personnel, properties, books and records of such party and its
Subsidiaries insofar as such access is reasonably required by the other party.
(b) For a period of five years following the Effective Time, each of
Olin and Primex shall provide to the other, promptly following such time at
which such documents shall be filed with the Securities and Exchange Commission
(the "Commission"), all documents that shall be filed by it and by any of its
respective Subsidiaries with the Commission pursuant to the periodic and interim
reporting requirements of the Securities Exchange Act of 1934, as amended, and
the rules and regulations of the Commission promulgated thereunder.
SECTION 3.03. REIMBURSEMENT; OTHER MATTERS. (a) Except to the
extent otherwise contemplated by any Ancillary Agreement, a party providing
Records or access to information to the other party under this Article III shall
be entitled to receive from the recipient, upon the presentation of invoices
therefor, payments for such amounts, relating to supplies, disbursements and
other out-of-pocket expenses, as may be reasonably incurred in providing such
Records or access to information.
(b) The parties hereto shall comply with such document retention
policies as shall be established and agreed to in writing by their respective
authorized officers on or prior to the Distribution Date in respect of Records
and related matters.
SECTION 3.04. CONFIDENTIALITY. Each of Olin and its Subsidiaries and
Primex and its Subsidiaries shall not use or permit the use of (without the
prior written consent of the other) and shall hold, and shall cause its
consultants and advisors to hold, in strict confidence, all information
concerning the other parties in its possession, its custody or under its control
(except to the extent that (A) such information has been in the public domain or
becomes part of the public domain through no fault of such party, (B) such
information has been later lawfully acquired from other sources by such party
without an obligation of confidence, (C) this Agreement or any other Ancillary
Agreement or any other agreement entered into pursuant hereto permits the use or
disclosure of such information or (D) such information is independently
developed by such party without reference to such information) to the extent
such information (x) relates to the period up to the Effective Time, (y) relates
to any Ancillary Agreement or (z) is obtained in the course of performing
services for the other party pursuant to any Ancillary Agreement, and each party
shall not (without the prior written consent of the other) otherwise release or
disclose such information to any other person, except such party's auditors and
attorneys, unless compelled to disclose such information by judicial or
administrative process or unless such disclosure is required by law and such
party has used commercially reasonable efforts to consult with the other
affected party or parties prior to such disclosure. To the extent that a party
hereto is compelled by judicial or administrative process to disclose such
information under circumstances in which any evidentiary privilege would be
available, such party agrees to assert such privilege in good faith prior to
making such disclosure. Each of the parties hereto agrees to consult with each
relevant other party in connection with any such judicial or administrative
process, including, without limitation, in determining whether any privilege is
available, and further agrees to allow each such relevant party and its counsel
to participate in any hearing or other proceeding (including, without
limitation, any appeal of an initial order to disclose) in respect of such
disclosure and assertion of privilege.
ARTICLE IV
DISPUTE RESOLUTION
In the event of a controversy, dispute or claim arising out of, in
connection with, or in relation to the interpretation, performance,
nonperformance, validity or breach of this Agreement or otherwise arising out
of, or in any way related to this Agreement, including, without limitation, any
claim based on contract, tort, statute or constitution (collectively, "Agreement
Disputes"), the General Counsels (or their designees) of the relevant parties
shall negotiate in good faith for a reasonable period of time to settle such
Agreement Dispute.
If after such reasonable period such General Counsels (or their
designees) are unable to settle such Agreement Dispute (and in any event after
60 days have elapsed from the time the relevant parties began such
negotiations), such Agreement Dispute shall be determined, at the request of any
relevant party, by arbitration conducted in New York City, before and in
accordance with the then-existing Rules for Commercial Arbitration of the
American Arbitration Association (the "Rules"), and any judgment or award
rendered by the arbitrator shall be final, binding and nonappealable (except
upon grounds specified in 9 U.S.C. 10(a) as in effect on the date hereof), and
judgment may be entered by any state or Federal court having jurisdiction
thereof in accordance with Section 9.19 hereof. Unless the arbitrator otherwise
determines, the pre-trial discovery of the then-existing Federal Rules of Civil
Procedure and the then-existing Rules 46 and 47 of the Civil Rules for the
United States District Court for the Southern District of New York shall apply
to any arbitration hereunder. Any controversy concerning whether an Agreement
Dispute is an arbitrable Agreement Dispute, whether arbitration has been waived,
whether an assignee of this Agreement is bound to arbitrate, or as to the
interpretation of enforceability of this Article VI shall be determined by the
arbitrator. The arbitrator shall be a retired or former judge of any United
States District Court or Court of Appeals or such other qualified person as the
relevant parties may agree to designate, PROVIDED such individual has had
substantial professional experience with regard to settling commercial disputes.
The parties intend that the provisions to arbitrate set forth herein be valid,
enforceable and irrevocable. The designation of a situs or a governing law for
this Agreement or the arbitration shall not be deemed an election to preclude
application of the Federal Arbitration Act, if it would be applicable. In his
award the arbitrator shall allocate, in his discretion, among the parties to the
arbitration all costs of the arbitration, including, without limitation, the
fees and expenses of the arbitrator and reasonable attorneys' fees, costs and
expert witness expenses of the parties. The undersigned agree to comply with
any award made in any such arbitration proceedings that has become final in
accordance with the Rules and agree to the entry of a judgment in any
jurisdiction upon any award rendered in such proceedings becoming final under
the Rules. The arbitrator shall be entitled, if appropriate, to award any
remedy in such proceedings, including, without limitation, monetary damages,
specific performance and all other forms of legal and equitable relief;
PROVIDED, HOWEVER, the arbitrator shall not be entitled to award punitive
damages.
ARTICLE V
INSURANCE
SECTION 5.01. COVERAGE. As of the Effective Time, coverage of Primex
and its Subsidiaries shall cease under current Company Policies, except as
provided in this Article V. From and after the Effective Time, Primex and its
Subsidiaries will be responsible for obtaining and maintaining insurance
coverages for their own account, and, with respect to policies of commercial
general liability insurance, shall name Olin as an additional insured with
respect to liabilities assumed by Primex under the Indemnity Agreement. To the
extent that liabilities arising from the activities of Olin prior to the
Effective Time are covered by Company Policies, and result in the assertion of
claims against Primex after the Effective Time, it is the intention of the
parties that, without increasing or expanding the risks assumed by the insurer,
Primex will have the benefit of such insurance coverage after the Effective
Time. No assignment pursuant to Section 5.02 is intended to increase the
liability of any insurer under a Company Policy. If and when such assignment
occurs, it is Olin's intention to assign only such coverage as would have been
available to Olin in respect of the Primex Business if the Distribution had not
occurred.
SECTION 5.02. CLAIMS FOLLOWING THE EFFECTIVE TIME; WAIVER. (a) If,
subsequent to the Effective Time, any person shall assert a claim or institute a
suit, action or proceeding against Primex or any of its Subsidiaries (including,
without limitation, where Primex or its Subsidiaries are joint defendants with
other persons) with respect to any injury, loss, liability, damage or expense
incurred or claimed to have been incurred prior to the Effective Time in the
course of or in connection with the conduct of the Primex Business and which
injury, loss, liability, damage or expense may constitute an insured or
insurable occurrence under one or more Company Policies, Olin shall, at the time
such claim is asserted, be deemed, without need of further documentation, to
assign to Primex or any of its Subsidiaries an interest in the relevant Company
Policies (unless such assignment would render Olin's coverage for such
occurrence thereunder void), subject to any limitations or obligations of Primex
contemplated by this Article V, if necessary, and then only to the extent
necessary, to convey to Primex or any of its Subsidiaries rights of indemnity
and the right to be defended by or at the expense of the insurer, with respect
to any such claim, suit, action, proceeding, injury, loss, liability, damage or
expense; PROVIDED, HOWEVER, that, with respect to Company Policies for which
Primex has payment obligations pursuant to Section 5.05 or otherwise, Primex and
its Subsidiaries shall only have the rights set forth under this Section 5.02(a)
with respect to such Company Policies if such payment obligations have been
satisfied by Primex.
(b) Notwithstanding any contrary provision contained herein, Olin
shall at all times retain the Company Policies, together with the rights,
benefits and privileges thereunder, including without limitation the right to
invade or exhaust any Company Policy by submission of claims, settlement or
otherwise; PROVIDED, that the retention of the Company Policies by Olin is not
intended to limit, inhibit or preclude any right granted pursuant to
Section 5.02(a), and PROVIDED FURTHER that Section 5.02(a) is not intended to
limit, inhibit or preclude any rights, benefits or privileges Olin may have
under Company Policies. Primex hereby specifically agrees that Olin, in its
sole discretion, may at any time and without the consent of Primex or any of its
Subsidiaries, extinguish any rights Primex and its Subsidiaries may have under
Company Policies, including any rights granted pursuant to Section 5.02(a), and
grant a release to any insurance carrier absolving such carrier from further
liability pursuant to any Company Policy, including for claims asserted with
respect to Liabilities assumed by Primex under the Indemnity Agreement. Olin
shall promptly notify Primex of the extinguishment of any such rights.
SECTION 5.03. ADMINISTRATION. Except as provided in the third
sentence of this Section 5.03, from and after the Effective Time, Olin shall be
responsible for Claims Administration with respect to Olin Liabilities and
Primex or a Primex Subsidiary, as appropriate, shall be responsible for Claims
Administration with respect to Primex Liabilities. Except as provided in the
third sentence of this Section 5.03, Olin hereby appoints Primex as its agent
and attorney in fact to assert claims against insurance carriers and to
otherwise perform Claims Administration with respect to Primex Liabilities.
Notwithstanding the foregoing, Olin shall be responsible for Claims
Administration with respect to Primex Liabilities with respect to which Olin is
engaged in coverage litigation as of the Effective Time ("Litigated Primex
Liabilities").
SECTION 5.04. INSURANCE PROCEEDS. Proceeds received with respect to
claims made under Company Policies shall be paid to Olin with respect to Olin
Liabilities and to Primex with respect to Primex Liabilities; PROVIDED, that
proceeds received with respect to Litigated Primex Liabilities shall be
allocated between Olin and Primex pro rata based on the amounts actually
expended by the parties in connection therewith.
SECTION 5.05. RETROSPECTIVELY RATED POLICIES. From and after the
Effective Time, any additional premiums payable or rebates of premiums
previously paid in respect of any retrospectively rated Company Policy shall be
paid or collected by Olin. Olin shall be reimbursed by Primex, or shall
distribute to Primex, amounts equal to the portion of any such additional
premium or rebate, as applicable, which relates to the Primex Business. From
and after the Effective Time, any additional premiums payable or rebates of
premiums previously paid in respect of any retrospectively rated Policy of
Primex or any of its Subsidiaries (including without limitation Policies
maintained by or for the benefit of General Defense Corporation) shall be paid
or collected by Primex or its Subsidiaries.
SECTION 5.06. AGREEMENT FOR WAIVER OF CONFLICT AND SHARED DEFENSE.
In the event that Insured Claims of more than one of the parties hereto exist
relating to the same occurrence, the parties shall jointly defend and waive any
conflict of interest necessary to the conduct of the joint defense. Nothing in
this Section 5.06 shall be construed to limit or otherwise alter in any way the
obligations of the parties to this Agreement, including those created by this
Agreement, by operation of law or otherwise.
SECTION 5.07. COOPERATION. The parties hereto agree to use their
commercially reasonable efforts to cooperate with respect to the various
insurance matters contemplated by this Agreement.
SECTION 5.08. INDEMNITY AGREEMENT. The parties hereto agree that the
amount which any indemnifying party is or may be required to pay to an
indemnified party pursuant to the Indemnity Agreement shall be reduced
(including, without limitation, retroactively) by any proceeds of insurance
policies or other amounts actually recovered by or on behalf of such indemnified
party in reduction of the related Liability (as defined in the Indemnity
Agreement). If an indemnified party shall have received the payment (an
"Indemnity Payment") required by the Indemnity Agreement from an indemnifying
party in respect of any Liability (as defined in the Indemnity Agreement) and
shall subsequently actually receive proceeds of insurance policies or other
amounts in respect of such Liability, then such indemnified party shall repay to
such indemnifying party a sum equal to the amount actually received (up to but
not in excess of the amount of any Indemnity Payment made thereunder). An
insurer who would otherwise be obligated to pay any claim shall not, solely by
virtue of the indemnification provisions contained in the Indemnity Agreement,
be relieved of its responsibility with respect thereto, or have any subrogation
rights with respect thereto, it being expressly understood and agreed that no
insurer or any other third party shall be entitled to a benefit they would not
otherwise be entitled to receive in the absence of the indemnification
provisions contained in the Indemnity Agreement by virtue thereof.
ARTICLE VI
EMPLOYEE OBLIGATIONS AND BENEFIT PLANS
SECTION 6.01. RETIREMENT PLANS. (a) RECOGNITION OF SERVICE BY
OLIN. Effective as of the Effective Time, Olin shall cause the Olin Pension
Plan to be amended to (i) recognize all Creditable Service (as defined in the
Olin Pension Plan) by employees of Olin who have transferred from Olin or any of
its Subsidiaries directly to Primex on or within five years following the
Effective Time; (ii) include in such employees' Final Average Pay (as defined in
the Olin Pension Plan) compensation received from Primex or any of its
Subsidiaries, as determined at the time of retirement from Primex or any such
Subsidiary; and (iii) to recognize service with Primex or any of its
Subsidiaries on and after the Effective Time for the purpose of meeting all
vesting and early retirement requirements of the Olin Pension Plan (but not for
the purpose of calculating benefit service credit thereunder). Employees of
Primex who are eligible to receive benefits under the Olin Pension Plan, as
amended as contemplated above, will not be entitled to receive such benefits
prior to retirement from Primex.
(b) ADOPTION OF PRIME. Effective as of the Effective Time, Primex
shall adopt PRIME. PRIME shall recognize all prior service with Olin or any of
its Subsidiaries for the purpose of meeting all vesting requirements thereunder
(but not for the purpose of calculating benefit service credit thereunder) for
all individuals who become employees of Primex or any of its Subsidiaries within
five years following the Effective Time and who were employed by Olin or any of
its Subsidiaries immediately prior to becoming an employee of Primex. No Olin
Pension Plan assets will be transferred to Primex or any employee benefit trust
of Primex.
(c) MANAGEMENT SECURITY PLAN. Primex hereby agrees to assume, and
shall indemnify and hold harmless Olin from and against, all claims brought
against Olin or any of its Subsidiaries under the Management Security Plan by
any employee of Primex or any of its Subsidiaries who retires after the
Effective Time.
SECTION 6.02. INVESTMENT AND SAVINGS PROGRAMS. (a) OLIN CEOP
PLAN. Employee contributions and employer matching contributions under the Olin
CEOP Plan will cease as of the Effective Time (or any subsequent date within
five years following the Effective Time on which an employee of Olin transfers
directly to Primex) in respect of all Primex employees. Participants under the
Olin CEOP Plan who are employees of Primex at the Effective Time will be 100%
vested in their account balances thereunder as of such date.
(b) TRANSFER OF CEOP ACCOUNT. Olin and Primex will cause the account
balance of any participant under the Olin CEOP Plan who will be an employee of
Primex at the Effective Time to be transferred to PRIME unless instructed by a
participant to the contrary prior to the date determined by Olin for such
purpose.
SECTION 6.03. SUPPLEMENTAL PLANS. Effective as of the Effective
Time, Olin shall continue to sponsor the Olin Supplemental Plans, subject to the
terms thereof. Olin hereby assumes all liability for benefits (whether funded
or unfunded) that have accrued prior to the Effective Time under the Olin
Supplemental Plans with respect to persons who immediately after the
Distribution are employed on a salaried basis by Primex. Effective as of the
Effective Time, Primex shall adopt the Primex Supplemental Plan, which will be
designed to restore any benefits under PRIME that would otherwise be reduced as
a result of limitations contained in the Code for certain employees. Prior
service with Olin will be recognized under the Primex Supplemental Plan for the
purpose of meeting all vesting requirements thereunder.
SECTION 6.04. RETIREE WELFARE AND LIFE INSURANCE PLANS. Effective as
of the Effective Time, Olin shall continue to sponsor the retiree medical
benefit and life insurance plans of Olin. Olin hereby agrees that it will
retain all liability with respect to medical and life insurance benefits
provided to former employees of the Ordnance and Aerospace Divisions of Olin who
retire prior to the Effective Time. Effective as of the Effective Time, Primex
shall adopt a medical and life insurance benefits plan substantially similar to
Olin's retiree benefits program. Other than possible increases in employee
contributions, Primex hereby agrees that the benefits provided under its retiree
medical and life insurance benefits program shall not be reduced or terminated
prior to the fifth anniversary of the Effective Time. Primex hereby agrees to
assume, and shall indemnify and hold harmless Olin from and against, all claims
brought against Olin or any of its Subsidiaries under Olin's retiree medical and
life insurance benefit plans by any employee of Primex who retires after the
Effective Time.
SECTION 6.05. OTHER BENEFITS. Olin shall continue to be responsible
for health care and disability claims incurred by an employee of Olin or any of
its Subsidiaries prior to the Effective Time under existing Olin benefit plans.
Effective as of the Effective Time, Primex shall adopt health care and
disability benefits programs affording benefits substantially similar to those
provided under Olin's benefit plans covering claims incurred by all employees of
Primex or any of its Subsidiaries after the Distribution Date.
SECTION 6.06. SEVERANCE CLAIMS. Primex shall assume, and shall
indemnify and hold Olin harmless against, all claims and liabilities for
severance, change-in-control or termination benefits arising out of or resulting
from the transfer of employment of any employee of Olin or any of its
Subsidiaries to Primex or any of its Subsidiaries at the Effective Time.
SECTION 6.07. BARGAINING EMPLOYEES. Primex hereby acknowledges and
agrees that it shall be the "successor employer" to Olin under the collective
bargaining agreements listed on Schedule 6.07 (the "Collective Bargaining
Agreements"). Effective as of the Effective Time, Primex shall adopt a pension
plan and establish a pension trust for the purpose of funding benefits which
accrue under the Collective Bargaining Agreements following the Effective Time.
Credited service accrued under the Olin Pension Plan prior to the Effective Time
with respect to the Collective Bargaining Agreements will be recognized under
such Primex pension plan for the purpose of meeting all vesting and early
retirement requirements thereunder (but not for the purpose of calculating
benefit service credit thereunder). No Olin pension assets for bargaining
employees will be transferred to Primex or to a Primex pension trust for
bargaining employees. The Olin Pension Plan shall be responsible for pension
benefits of Olin's bargaining employees which have accrued under the Collective
Bargaining Agreements prior to the Effective Time.
ARTICLE VII
MISCELLANEOUS
SECTION 7.01. COMPLETE AGREEMENT; CONSTRUCTION. This Agreement,
including the Exhibits and Schedules, and the Ancillary Agreements shall
constitute the entire agreement between the parties with respect to the subject
matter hereof and shall supersede all previous negotiations, commitments and
writings with respect to such subject matter. In the event of any inconsistency
between this Agreement and any Schedule hereto, the Schedule shall prevail.
Notwithstanding any other provisions in this Agreement to the contrary, in the
event and to the extent that there shall be a conflict between the provisions of
this Agreement and the provisions of any Ancillary Agreement, such Ancillary
Agreement shall control.
SECTION 7.02. ANCILLARY AGREEMENTS. This Agreement is not intended
to address, and should not be interpreted to address, the matters specifically
and expressly covered by the Ancillary Agreements.
SECTION 7.03. COUNTERPARTS. This Agreement may be executed in one or
more counterparts, all of which shall be considered one and the same agreement,
and shall become effective when one or more such counterparts have been signed
by each of the parties and delivered to the other parties.
SECTION 7.04. SURVIVAL OF AGREEMENTS. Except as otherwise
contemplated by this Agreement, all covenants and agreements of the parties
contained in this Agreement shall survive the Effective Time.
SECTION 7.05. EXPENSES. Except as otherwise set forth in this
Agreement or any Ancillary Agreement, all costs and expenses incurred on or
prior to the Effective Time (whether or not paid on or prior to the Effective
Time) in connection with the preparation, execution, delivery and implementation
of this Agreement and any Ancillary Agreement, the Information Statement and the
Distribution and the consummation of the transactions contemplated thereby shall
be charged to and paid by Olin; PROVIDED that Olin shall not be responsible for
those costs or expenses incurred by Primex (including, without limitation, any
attorney or financial advisor fees owing to attorneys or financial advisors
retained by Primex). Except as otherwise set forth in this Agreement or any
Ancillary Agreement, each party shall bear its own costs and expenses incurred
after the Effective Time.
SECTION 7.06. NOTICES. All notices and other communications
hereunder shall be in writing and hand delivered or mailed by registered or
certified mail (return receipt requested) or sent by any means of electronic
message transmission with delivery confirmed (by voice or otherwise) to the
parties at the following addresses (or at such other addresses for a party as
shall be specified by like notice) and will be deemed given on the date on which
such notice is received:
To Olin Corporation:
501 Merritt 7
P.O. Box 4500
Norwalk, CT 06851
Attn: Corporate Secretary
To Primex:
10101 Ninth Street North
St. Petersburg, FL 33716-3807
Attn: Corporate Secretary
SECTION 7.07. WAIVERS. The failure of either party to require strict
performance by the other party of any provision in this Agreement will not waive
or diminish that party's right to demand strict performance thereafter of that
or any other provision hereof.
SECTION 7.08. AMENDMENTS. Subject to the terms of Section 7.11
hereof, this Agreement may not be modified or amended except by an agreement in
writing signed by the parties.
SECTION 7.09. ASSIGNMENT. This Agreement shall be assignable in
whole in connection with a merger or consolidation or the sale of all or
substantially all the assets of a party hereto so long as the resulting,
surviving or transferee entity assumes all the obligations of the relevant party
hereto by operation of law or pursuant to an agreement in form and substance
reasonably satisfactory to the other parties to this Agreement. Otherwise this
Agreement shall not be assignable, in whole or in part, directly or indirectly,
by any party hereto without the prior written consent of the others, and any
attempt to assign any rights or obligations arising under this Agreement without
such consent shall be void.
SECTION 7.10. SUCCESSORS AND ASSIGNS. The provisions of this
Agreement shall be binding upon, inure to the benefit of and be enforceable by
the parties and their respective successors and permitted assigns.
SECTION 7.11. TERMINATION. This Agreement may be terminated and the
Distribution may be amended, modified or abandoned at any time prior to the
Effective Time by and in the sole discretion of Olin without the approval of
Primex or the shareholders of Olin. In the event of such termination, no party
shall have any liability of any kind to any other party or any other person.
After the Effective Time, this Agreement may not be terminated except by an
agreement in writing signed by the parties.
SECTION 7.12. SUBSIDIARIES. Each of the parties hereto shall cause
to be performed, and hereby guarantees the performance of, all actions,
agreements and obligations set forth herein to be performed by any Subsidiary of
such party or by any entity that is contemplated to be a Subsidiary of such
party on and after the Effective Time.
SECTION 7.13. THIRD PARTY BENEFICIARIES. This Agreement is solely
for the benefit of the parties hereto and their respective Subsidiaries and
Affiliates and should not be deemed to confer upon third parties any remedy,
claim, liability, reimbursement, claim of action or other right in excess of
those existing without reference to this Agreement.
SECTION 7.14. ATTORNEY FEES. Except as contemplated by the third to
the last sentence of Article IV hereof, a party in breach of this Agreement
shall, on demand, indemnify and hold harmless the other parties hereto for and
against all out-of-pocket expenses, including, without limitation, legal fees,
incurred by such other party by reason of the enforcement and protection of its
rights under this Agreement. The payment of such expenses is in addition to any
other relief to which such other party may be entitled hereunder or otherwise.
SECTION 7.15. TITLE AND HEADINGS. Titles and headings to sections
herein are inserted for the convenience of reference only and are not intended
to be a part of or to affect the meaning or interpretation of this Agreement.
SECTION 7.16. EXHIBITS AND SCHEDULES. The Exhibits and Schedules
shall be construed with and as an integral part of this Agreement to the same
extent as if the same had been set forth verbatim herein.
SECTION 7.17. SPECIFIC PERFORMANCE. Each of the parties hereto
acknowledges that there is no adequate remedy at law for failure by such parties
to comply with the provisions of this Agreement and that such failure would
cause immediate harm that would not be adequately compensable in damages, and
therefore agree that their agreements contained herein may be specifically
enforced without the requirement of posting a bond or other security, in
addition to all other remedies available to the parties hereto under this
Agreement.
SECTION 7.18. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE COMMONWEALTH OF VIRGINIA APPLICABLE
TO CONTRACTS EXECUTED THEREIN AND TO BE PERFORMED THEREIN.
SECTION 7.19. CONSENT TO JURISDICTION. Without limiting the
provisions of Article IV hereof, each of the parties irrevocably submits to the
exclusive personal jurisdiction and venue of (a) the Circuit Court of Henrico
County, Commonwealth of Virginia, and (b) the United States District Court for
the Eastern District of Virginia (Richmond Division), for the purposes of any
suit, action or other proceeding arising out of this Agreement or any
transaction contemplated hereby. Each of the parties agrees to commence any
action, suit or proceeding relating hereto either in the United States District
Court for the Eastern District of Virginia (Richmond Division) or if such suit,
action or other proceeding may not be brought in such court for jurisdictional
reasons, in the Circuit Court of the Henrico County, Commonwealth of Virginia.
Each of the parties further agrees that service of any process, summons, notice
or document by U.S. registered mail to such party's respective address set forth
above shall be effective service of process for any action, suit or proceeding
in Virginia with respect to any matters to which it has submitted to
jurisdiction in this Section 7.19. Each of the parties irrevocably and
unconditionally waives any objection to the laying of venue of any action, suit
or proceeding arising out of this Agreement or the transactions contemplated
hereby in (i) the Circuit Court of Henrico County, Commonwealth of Virginia, or
(ii) the United States District Court for the Eastern District of Virginia, and
hereby further irrevocably and unconditionally waives and agrees not to plead or
claim in any such court that any such action, suit or proceeding brought in any
such court has been brought in an inconvenient forum.
SECTION 7.20. SEVERABILITY. In the event any one or more of the
provisions contained in this Agreement should be held invalid, illegal or
unenforceable in any respect, the validity, legality and enforceability of the
remaining provisions contained herein and therein shall not in any way be
affected or impaired thereby. The parties shall endeavor in good-faith
negotiations to replace the invalid, illegal or unenforceable provisions with
valid provisions, the economic effect of which comes as close as possible to
that of the invalid, illegal or unenforceable provisions.
IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed as of the day and year first above written.
OLIN CORPORATION,
by: /s/Johnnie M. Jackson, Jr.
--------------------------
Johnnie M. Jackson, Jr.
Vice President, General Counsel
and Secretary
PRIMEX TECHNOLOGIES, INC.,
by: /s/Johnnie M. Jackson, Jr.
--------------------------
Johnnie M. Jackson, Jr.
Vice President and Secretary
Exhibit A
1. Government owned contractor operated facilities and assets
related thereto, including the stock and assets of Ravenna
Arsenal, Inc. ("RAI") and any rights and recoveries under any
contract with the U.S. Government to which RAI is or was a party.
2. The name "Olin Corporation" and derivatives thereof.
3. Certain other assets specifically contemplated by the various
Ancillary Agreements.
Exhibit B -- Articles of Incorporation
[SEE EXHIBIT 3.1 TO THIS FORM 8-K FILING.]
Exhibit C -- By-laws
[SEE EXHIBIT 3.2 TO THIS FORM 8-K FILING.]
Schedule 2.09
GUARANTIES
1. Agreement of Guaranty No. 1, dated December 29, 1986, between
Olin Corporation and The Connecticut National Bank, as Trustee.
2. Agreement of Guaranty No. 2, dated December 29, 1986, between
Olin Corporation and The Connecticut National Bank, as Trustee.
3. Guaranties of Olin Corporation arising under Novation
Agreements with the U.S. Government or agencies thereof entered
into or to be entered into in connection with the Distribution.
Schedule 6.07
COLLECTIVE BARGAINING AGREEMENTS
1. Agreement between Olin Corporation and United Steelworkers of
America AFL-CIO-CLC (Local 15009A) dated December 9, 1989.
2. Agreement between Olin Corporation and the International Union,
United Steelworkers of America (AFL-CIO-CLC) on behalf of Local
Number 8018 dated October 15, 1994.
EXHIBIT 3.1
AMENDED AND RESTATED
ARTICLES OF INCORPORATION
of
PRIMEX TECHNOLOGIES, INC.
ARTICLE I
The name of the Corporation shall be Primex Technologies, Inc.
ARTICLE II
The purpose for which the Corporation is formed is to transact any or all
lawful business, not required to be specifically stated in these Articles, for
which corporations may be incorporated under the Virginia Stock Corporation Act,
as amended from time to time.
ARTICLE III
The aggregate number of shares that the Corporation shall have authority to
issue shall be 10,000,000 shares of Preferred Stock, par value $1 per share
(hereinafter called Preferred Stock), and 60,000,000 shares of Common Stock, par
value $1 per share (hereinafter called Common Stock).
The following is a description of each of said different classes of stock,
and a statement of the preferences, limitations, voting rights and relative
rights in respect of the shares of each such class:
1. The Board of Directors shall have authority, by resolution or
resolutions, at any time and from time to time to divide and establish any
or all of the unissued shares of Preferred Stock not then allocated to any
series of Preferred Stock into one or more series, and, without limiting
the generality of the foregoing, to fix and determine the designation of
each such series, the number of shares which shall constitute such series
and the following relative rights and preferences of the shares of each
series so established:
(a) The annual or other periodic dividend rate payable on
shares of such series, the time of payment thereof, whether such
dividends shall be cumulative or non-cumulative, and the date or dates
from which any cumulative dividends shall commence to accrue;
(b) the price or prices at which and the terms and
conditions, if any, on which shares of such series may be redeemed;
(c) the amounts payable upon shares of such series in the
event of the voluntary or involuntary dissolution, liquidation or
winding-up of the affairs of the Corporation;
(d) the sinking fund provisions, if any, for the redemption
or purchase of shares of such series;
(e) the extent of the voting powers, if any, of the shares
of such series;
(f) the terms and conditions, if any, on which shares of
such series may be converted into shares of stock of the Corporation
of any other class or classes or into shares of any other series of
the same or any other class or classes;
(g) whether, and if so the extent to which, shares of such
series may participate with the Common Stock in any dividends in
excess of the preferential dividend fixed for shares of such series or
in any distribution of the assets of the Corporation, upon a
liquidation, dissolution or winding-up thereof, in excess of the
preferential amount fixed for shares of such series; and
(h) any other preferences and relative, optional or other
special rights, and qualifications, limitations or restrictions of
such preferences or rights, of shares of such series not fixed and
determined by law or in this Article III.
2. Each series of Preferred Stock shall be so designated as to
distinguish the shares thereof from the shares of all other series.
Different series of Preferred Stock shall not be considered to constitute
different classes of shares for the purpose of voting by classes except as
otherwise fixed by the Board of Directors with respect to any series at the
time of the creation thereof.
3. So long as any shares of Preferred Stock are outstanding, the
Corporation shall not declare and pay or set apart for payment any
dividends (other than dividends payable in Common Stock or other stock of
the Corporation ranking junior to the Preferred Stock as to dividends) or
make any other distribution on such junior stock, if at the time of making
such declaration, payment or distribution the Corporation shall be in
default with respect to any dividend payable on, or any obligation to
retire, shares of Preferred Stock.
4. Shares of any series of Preferred Stock that have been redeemed
or otherwise reacquired by the Corporation (whether through the operation
of a sinking fund, upon conversion or otherwise) shall have the status of
authorized and unissued shares of Preferred Stock and may be redesignated
and reissued as a part of such series (unless prohibited by the articles of
amendment creating such series) or of any other series of Preferred Stock.
Shares of Common Stock that have been reacquired by the Corporation shall
have the status of authorized and unissued shares of Common Stock and may
be reissued.
5. Subject to the provisions of any applicable law or of the By-laws
of the Corporation as from time to time amended with respect to the closing
of the transfer books or the fixing of a record date for the determination
of shareholders entitled to vote, and except as otherwise provided by law
or in resolutions of the Board of Directors establishing any series of
Preferred Stock pursuant to the provisions of paragraph 1 of this Article
III, the holders of outstanding shares of Common Stock of the Corporation
shall exclusively possess voting power for the election of directors and
for all other purposes, each holder of record of shares of Common Stock of
the Corporation being entitled to one vote for each share of such stock
standing in his name on the books of the Corporation.
6. No holder of shares of stock of any class of the Corporation
shall, as such holder, have any right to subscribe for or purchase (a) any
shares of stock of any class of the Corporation, or any warrants, options
or other instruments that shall confer upon the holder thereof the right to
subscribe for or purchase or receive from the Corporation any shares of
stock of any class, whether or not such shares of stock, warrants, options
or other instruments are issued for cash or services or property or by way
of dividend or otherwise, or (b) any other security of the Corporation that
shall be convertible into, or exchangeable for, any shares of stock of the
Corporation of any class or classes, or to which shall be attached or
appurtenant any warrant, option or other instrument that shall confer upon
the holder of such security the right to subscribe for or purchase or
receive from the Corporation any shares of its stock of any class or
classes, whether or not such securities are issued for cash or services or
property or by way of dividend or otherwise, other than such right, if any,
as the Board of Directors, in its sole discretion, may from time to time
determine. If the Board of Directors shall offer to the holders of shares
of stock of any class of the Corporation, or any of them, any such shares
of stock, options, warrants, instruments or other securities of the
Corporation, such offer shall not, in any way, constitute a waiver or
release of the right of the Board of Directors subsequently to dispose of
other securities of the Corporation without offering the same to said
holders.
7. Anything herein to the contrary notwithstanding, dividends upon
shares of any class of stock of the Corporation shall be payable only out
of assets legally available for the payment of such dividends, and the
rights of the holders of shares of stock of the Corporation in respect of
dividends shall at all times be subject to the power of the Board of
Directors to determine what dividends, if any, shall be declared and paid
to the shareholders.
8. Subject to the provisions hereof and except as otherwise provided
by law, shares of stock of any class of the Corporation may be issued for
such consideration and for such corporate purposes as the Board of
Directors may from time to time determine.
9. Series A Participating Cumulative Preferred Stock. There is
hereby established a series of the Corporation's authorized Preferred
Stock, to be designated as the "Series A Participating Cumulative Preferred
Stock, par value $1 per share." The designation and number, and relative
rights, preferences and limitations of the Series A Participating
Cumulative Preferred Stock, insofar as not already fixed by any other
provision of these Articles of Incorporation, shall be as follows:
SECTION 1. DESIGNATION AND NUMBER OF SHARES. The shares of
such series shall be designated as "Series A Participating Cumulative
Preferred Stock" (the "Series A Preferred Stock"), par value $1 per
share. The number of shares initially constituting the Series A
Preferred Stock shall be 250,000; PROVIDED, HOWEVER, that, if more
than a total of 250,000 shares of Series A Preferred Stock shall be
issuable upon the exercise of Rights (the "Rights") issued pursuant to
the Rights Agreement dated as of December 19, 1996, between the
Corporation and Chase Mellon Shareholder Services, L.L.C., as Rights
Agent (the "Rights Agreement"), the Board of Directors of the
Corporation, pursuant to Section 13.1-639 of the Virginia Stock
Corporation Act, shall direct by resolution or resolutions that
articles of amendment of the Articles of Incorporation of the
Corporation be properly executed and filed with the State Corporation
Commission of Virginia providing for the total number of shares of
Series A Preferred Stock authorized to be issued to be increased (to
the extent that the Articles of Incorporation then permit) to the
largest number of whole shares (rounded up to the nearest whole
number) issuable upon exercise of such Rights.
SECTION 2. DIVIDENDS OR DISTRIBUTIONS. (a) Subject to
the prior and superior rights of the holders of shares of any other
series of Preferred Stock or other class of capital stock of the
Corporation ranking prior and superior to the shares of Series A
Preferred Stock with respect to dividends, the holders of shares of
the Series A Preferred Stock shall be entitled to receive, when, as
and if declared by the Board of Directors, out of the assets of the
Corporation legally available therefor, (i) quarterly dividends
payable in cash on the last day of each fiscal quarter in each year,
or such other dates as the Board of Directors of the Corporation shall
approve (each such date being referred to herein as a "Quarterly
Dividend Payment Date"), commencing on the first Quarterly Dividend
Payment Date after the first issuance of a share or a fraction of a
share of Series A Preferred Stock, in the amount of $.01 per whole
share (rounded to the nearest cent), less the amount of all cash
dividends declared on the Series A Preferred Stock pursuant to the
following clause (ii) since the immediately preceding Quarterly
Dividend Payment Date or, with respect to the first Quarterly Dividend
Payment Date, since the first issuance of any share or fraction of a
share of Series A Preferred Stock (the total of which shall not, in
any event, be less than zero) and (ii) dividends payable in cash on
the payment date for each cash dividend declared on the Common Stock
in an amount per whole share (rounded to the nearest cent) equal to
the Formula Number (as hereinafter defined) then in effect times the
cash dividends then to be paid on each share of Common Stock. In
addition, if the Corporation shall pay any dividend or make any
distribution on the Common Stock payable in assets, securities or
other forms of non-cash consideration (other than dividends or
distributions solely in shares of Common Stock), then, in each such
case, the Corporation shall simultaneously pay or make on each
outstanding whole share of Series A Preferred Stock a dividend or
distribution in like kind equal to the Formula Number then in effect
times such dividend or distribution on each share of the Common Stock.
As used herein, the "Formula Number" shall be 1,000; provided,
however, that, if at any time after December 31, 1996, the Corporation
shall (x) declare or pay any dividend on the Common Stock payable in
shares of Common Stock or make any distribution on the Common Stock in
shares of Common Stock, (y) subdivide (by a stock split or otherwise)
the outstanding shares of Common Stock into a larger number of shares
of Common Stock or (z) combine (by a reverse stock split or otherwise)
the outstanding shares of Common Stock into a smaller number of shares
of Common Stock, then, in each such event, the Formula Number shall be
adjusted to a number determined by multiplying the Formula Number in
effect immediately prior to such event by a fraction, the numerator of
which is the number of shares of Common Stock that are outstanding
immediately after such event and the denominator of which is the
number of shares of Common Stock that are outstanding immediately
prior to such event (and rounding the result to the nearest whole
number); and PROVIDED FURTHER, that, if at any time after December 31,
1996, the Corporation shall issue any shares of its capital stock in a
merger, reclassification, or change of the outstanding shares of
Common Stock, then, in each such event, the Formula Number shall be
appropriately adjusted to reflect such merger, reclassification or
change so that each share of Preferred Stock continues to be the
economic equivalent of a Formula Number of shares of Common Stock
prior to such merger, reclassification or change.
(b) The Corporation shall declare a dividend or
distribution on the Series A Preferred Stock as provided in Section
2(a) immediately prior to or at the same time it declares a dividend
or distribution on the Common Stock (other than a dividend or
distribution solely in shares of Common Stock); PROVIDED, HOWEVER,
that, in the event no dividend or distribution (other than a dividend
or distribution in shares of Common Stock) shall have been declared on
the Common Stock during the period between any Quarterly Dividend
Payment Date and the next subsequent Quarterly Dividend Payment Date,
a dividend of $.01 per share on the Series A Preferred Stock shall
nevertheless be payable on such subsequent Quarterly Dividend Payment
Date. The Board of Directors may fix a record date for the
determination of holders of shares of Series A Preferred Stock
entitled to receive a dividend or distribution declared thereon, which
record date shall be the same as the record date for any corresponding
dividend or distribution on the Common Stock.
(c) Dividends shall begin to accrue and be cumulative on
outstanding shares of Series A Preferred Stock from and after the
Quarterly Dividend Payment Date next preceding the date of original
issue of such shares of Series A Preferred Stock; PROVIDED, HOWEVER,
that dividends on such shares that are originally issued after the
record date for the determination of holders of shares of Series A
Preferred Stock entitled to receive a quarterly dividend and on or
prior to the next succeeding Quarterly Dividend Payment Date shall
begin to accrue and be cumulative from and after such Quarterly
Dividend Payment Date. Notwithstanding the foregoing, dividends on
shares of Series A Preferred Stock that are originally issued prior to
the record date for the determination of holders of shares of Series A
Preferred Stock entitled to receive a quarterly dividend on the first
Quarterly Dividend Payment Date shall be calculated as if cumulative
from and after the last day of the fiscal quarter next preceding the
date of original issuance of such shares. Accrued but unpaid dividends
shall not bear interest. Dividends paid on the shares of Series A
Preferred Stock in an amount less than the total amount of such
dividends at the time accrued and payable on such shares shall be
allocated pro rata on a share-by-share basis among all such shares at
the time outstanding.
(d) So long as any shares of the Series A Preferred Stock
are outstanding, no dividends or other distributions shall be
declared, paid or distributed, or set aside for payment or
distribution, on the Common Stock, unless, in each case, the dividend
required by this Section 2 to be declared on the Series A Preferred
Stock shall have been declared.
(e) The holders of the shares of Series A Preferred Stock
shall not be entitled to receive any dividends or other distributions,
except as provided herein.
SECTION 3. VOTING RIGHTS. The holders of shares of Series A
Preferred Stock shall have the following voting rights:
(a) Each holder of Series A Preferred Stock shall be
entitled to a number of votes equal to the Formula Number then in
effect, for each share of Series A Preferred Stock held of record on
each matter on which holders of the Common Stock or shareholders
generally are entitled to vote, multiplied by the maximum number of
votes per share which any holder of the Common Stock or shareholders
generally then have with respect to such matter (assuming any holding
period or other requirement to vote a greater number of shares is
satisfied).
(b) Except as otherwise provided herein or by applicable
law, the holders of shares of Series A Preferred Stock and the holders
of shares of Common Stock shall vote together as one class for the
election of directors of the Corporation and on all other matters
submitted to a vote of shareholders of the Corporation.
(c) If, at the time of any annual meeting of shareholders
for the election of directors, the equivalent of six quarterly
dividends (whether or not consecutive) payable on any share or shares
of Series A Preferred Stock are in default, the number of directors
constituting the Board of Directors of the Corporation shall be
increased by two. In addition to voting together with the holders of
Common Stock for the election of other directors of the Corporation,
the holders of record of the Series A Preferred Stock, voting
separately as a class to the exclusion of the holders of Common Stock,
shall be entitled at said meeting of shareholders (and at each
subsequent annual meeting of shareholders), unless all dividends in
arrears have been paid or declared and set apart for payment prior
thereto, to vote for the election of two directors of the Corporation,
the holders of any Series A Preferred Stock being entitled to cast a
number of votes per share of Series A Preferred Stock equal to the
Formula Number. Until the default in payments of all dividends that
permitted the election of said directors shall cease to exist, any
director who shall have been so elected pursuant to the next preceding
sentence may be removed at any time, either with or without cause,
only by the affirmative vote of the holders of the shares of Series A
Preferred Stock at the time entitled to cast a majority of the votes
entitled to be cast for the election of any such director at a special
meeting of such holders called for that purpose, and any vacancy
thereby created may be filled by the vote of such holders. If and when
such default shall cease to exist, the holders of the Series A
Preferred Stock shall be divested of the foregoing special voting
rights, subject to revesting in the event of each and every subsequent
like default in payments of dividends. Upon the termination of the
foregoing special voting rights, the terms of office of all persons
who may have been elected directors pursuant to said special voting
rights shall forthwith terminate, and the number of directors
constituting the Board of Directors shall be reduced by two. The
voting rights granted by this Section 3(c) shall be in addition to any
other voting rights granted to the holders of the Series A Preferred
Stock in this Section 3.
(d) Except as provided herein, in Section 11 or by
applicable law, holders of Series A Preferred Stock shall have no
special voting rights and their consent shall not be required (except
to the extent they are entitled to vote with holders of Common Stock
as set forth herein) for authorizing or taking any corporate action.
SECTION 4. CERTAIN RESTRICTIONS. (a) Whenever quarterly
dividends or other dividends or distributions payable on the Series A
Preferred Stock as provided in Section 2 are in arrears, thereafter
and until all accrued and unpaid dividends and distributions, whether
or not declared, on shares of Series A Preferred Stock outstanding
shall have been paid in full, the Corporation shall not
(i) declare or pay dividends on, make any other
distributions on, or redeem or purchase or otherwise acquire for
consideration any shares of stock ranking junior (either as to
dividends or upon liquidation, dissolution or winding up) to the
Series A Preferred Stock;
(ii) declare or pay dividends on or make any other
distributions on any shares of stock ranking on a parity (either as to
dividends or upon liquidation, dissolution or winding up) with the
Series A Preferred Stock, except dividends paid ratably on the Series
A Preferred Stock and all such parity stock on which dividends are
payable or in arrears in proportion to the total amounts to which the
holders of all such shares are then entitled;
(iii) redeem or purchase or otherwise acquire for
consideration shares of any stock ranking on a parity (either as to
dividends or upon liquidation, dissolution or winding up) with the
Series A Preferred Stock; PROVIDED that the Corporation may at any
time redeem, purchase or otherwise acquire shares of any such parity
stock in exchange for shares of any stock of the Corporation ranking
junior (either as to dividends or upon dissolution, liquidation or
winding up) to the Series A Preferred Stock; or
(iv) purchase or otherwise acquire for consideration any
shares of Series A Preferred Stock, or any shares of stock ranking on
a parity with the Series A Preferred Stock, except in accordance with
a purchase offer made in writing or by publication (as determined by
the Board of Directors) to all holders of such shares upon such terms
as the Board of Directors, after consideration of the respective
annual dividend rates and other relative rights and preferences of the
respective series and classes, shall determine in good faith will
result in fair and equitable treatment among the respective series or
classes.
(b) The Corporation shall not permit any subsidiary of the
Corporation to purchase or otherwise acquire for consideration any
shares of stock of the Corporation unless the Corporation could, under
paragraph (a) of this Section 4, purchase or otherwise acquire such
shares at such time and in such manner.
SECTION 5. LIQUIDATION RIGHTS. Upon the liquidation,
dissolution or winding up of the Corporation, whether voluntary or
involuntary, no distribution shall be made (a) to the holders of
shares of stock ranking junior (either as to dividends or upon
liquidation, dissolution or winding up) to the Series A Preferred
Stock, unless, prior thereto, the holders of shares of Series A
Preferred Stock shall have received an amount equal to the accrued and
unpaid dividends and distributions thereon, whether or not declared,
to the date of such payment, plus an amount equal to the greater of
(i) $.01 per whole share or (ii) an aggregate amount per share equal
to the Formula Number then in effect times the aggregate amount to be
distributed per share to holders of Common Stock or (b) to the holders
of stock ranking on a parity (either as to dividends or upon
liquidation, dissolution or winding up) with the Series A Preferred
Stock, except distributions made ratably on the Series A Preferred
Stock and all other such parity stock in proportion to the total
amounts to which the holders of all such shares are entitled upon such
liquidation, dissolution or winding up.
SECTION 6. CONSOLIDATION, MERGER, ETC. In case the
Corporation shall enter into any consolidation, merger, combination or
other transaction in which the shares of Common Stock are exchanged
for or changed into other stock or securities, cash or any other
property, then, in any such case, the then outstanding shares of
Series A Preferred Stock shall at the same time be similarly exchanged
or changed into an amount per share equal to the Formula Number then
in effect times the aggregate amount of stock, securities, cash or any
other property (payable in kind), as the case may be, into which or
for which each share of Common Stock is exchanged or changed. In the
event both this Section 6 and Section 2 appear to apply to a
transaction, this Section 6 will control.
SECTION 7. NO REDEMPTION; NO SINKING FUND. (a) The shares
of Series A Preferred Stock shall not be subject to redemption by the
Corporation or at the option of any holder of Series A Preferred
Stock; PROVIDED, HOWEVER, that the Corporation may purchase or
otherwise acquire outstanding shares of Series A Preferred Stock in
the open market or by offer to any holder or holders of shares of
Series A Preferred Stock.
(b) The shares of Series A Preferred Stock shall not be
subject to or entitled to the operation of a retirement or sinking
fund.
SECTION 8. RANKING. The Series A Preferred Stock shall
rank junior to all other series of Preferred Stock of the Corporation,
unless the Board of Directors shall specifically determine otherwise
in fixing the powers, preferences and relative, participating,
optional and other special rights of the shares of such series and the
qualifications, limitations and restrictions thereof.
SECTION 9. FRACTIONAL SHARES. The Series A Preferred Stock
shall be issuable upon exercise of the Rights issued pursuant to the
Rights Agreement in whole shares or in any fraction of a share that is
one-thousandth (1/1,000) of a share or any integral multiple of such
fraction which shall entitle the holder, in proportion to such
holder's fractional shares, to receive dividends, exercise voting
rights, participate in distributions and have the benefit of all other
rights of holders of Series A Preferred Stock. In lieu of fractional
shares, the Corporation, prior to the first issuance of a share or a
fraction of a share of Series A Preferred Stock, may elect (a) to make
a cash payment as provided in the Rights Agreement for fractions of a
share other than one-thousandth (1/1,000) of a share or any integral
multiple thereof or (b) to issue depository receipts evidencing such
authorized fraction of a share of Series A Preferred Stock pursuant to
an appropriate agreement between the Corporation and a depository
selected by the Corporation; PROVIDED that such agreement shall
provide that the holders of such depository receipts shall have all
the rights, privileges and preferences to which they are entitled as
holders of the Series A Preferred Stock.
SECTION 10. REACQUIRED SHARES. Any shares of Series A
Preferred Stock purchased or otherwise acquired by the Corporation in
any manner whatsoever shall be retired and canceled promptly after the
acquisition thereof. All such shares shall upon their cancellation
become authorized but unissued shares of Preferred Stock, par value $1
per share, of the Corporation, undesignated as to series, and may
thereafter be reissued as part of a new series of such Preferred
Shares as permitted by law.
SECTION 11. AMENDMENT. None of the powers, preferences and
relative, participating, optional and other special rights of the
Series A Preferred Stock as provided herein or in the Articles of
Incorporation shall be amended in any manner that would alter or
change the powers, preferences, rights or privileges of the holders of
Series A Preferred Stock so as to affect such holders adversely
without the affirmative vote of the holders of at least 66-2/3% of the
outstanding shares of Series A Preferred Stock, voting as a separate
class; PROVIDED, HOWEVER, that no such amendment approved by the
holders of at least 66-2/3% of the outstanding shares of Series A
Preferred Stock shall be deemed to apply to the powers, preferences,
rights or privileges of any holder of shares of Series A Preferred
Stock originally issued upon exercise of a Right after the time of
such approval without the approval of such holder.
ARTICLE IV
The period of the duration of the Corporation is unlimited and perpetual.
ARTICLE V
1. The number of directors shall be as specified in the By-laws of
the Corporation but such number may be increased or decreased from time to
time in such manner as may be prescribed in the By-laws. In the absence of
a By-law specifying the number of directors, the number shall be nine. The
Board of Directors shall be divided into three classes, Class I, Class II,
and Class III, as nearly equal in number as possible. The initial term of
each class of directors shall expire at the annual meeting of shareholders
to be held in the following years: Class I - 1997; Class II - 1998; and
Class III - 1999. At the 1997 annual meeting of shareholders, directors of
the first class (Class I) shall be elected to hold office for a term
expiring at the 2000 annual meeting of shareholders. At each annual
meeting of shareholders after 1997, the successors to the class of
directors whose term shall then expire shall be identified as being of the
same class of directors they succeed and shall be elected to hold office
for a term expiring at the third succeeding annual meeting of shareholders.
When the number of directors is changed, any newly-created directorships or
any decrease in directorships shall be so apportioned among the classes by
the Board of Directors as to make all classes as nearly equal in number as
possible.
2. Subject to the rights of the holders of any Preferred Stock then
outstanding, directors may be removed only with cause.
3. Subject to the rights of the holders of any Preferred Stock then
outstanding, newly-created directorships resulting from any increase in the
number of directors and any vacancies in the Board of Directors resulting
from death, resignation, disqualification, removal or other cause shall be
filled solely by the Board of Directors or at an annual meeting of
shareholders by the shareholders entitled to vote on the election of
directors. If the directors remaining in office constitute fewer than a
quorum of the Board, they may fill the vacancy by the affirmative vote of a
majority of the directors remaining in office.
4. Notwithstanding any other provision of these Articles of
Incorporation or any provision of law which might otherwise permit a lesser
vote, but in addition to any affirmative vote of the holders of any
particular class or series of the stock of the Corporation required by law,
these Articles of Incorporation or any Preferred Stock outstanding, the
affirmative vote of at least 80 percent of the outstanding shares of the
Corporation entitled to vote generally at any annual or special meeting of
the shareholders shall be required to alter, amend or repeal paragraph 1 of
this Article V.
ARTICLE VI
Except as expressly otherwise required in these Articles of Incorporation,
an amendment or restatement of these Articles requiring shareholder approval
shall be approved by a majority of the votes entitled to be cast by each voting
group that is entitled to vote on the matter, unless in submitting an amendment
or restatement to the shareholders the Board of Directors shall require a
greater vote.
ARTICLE VII
1. Every person who is or was a director, officer or employee of the
Corporation, or who, at the request of the Corporation, serves or has
served in any such capacity with another corporation, partnership, joint
venture, trust, employee benefit plan, or other enterprise shall be
indemnified by the Corporation against any and all liability and reasonable
expense that may be incurred by him in connection with or resulting from
any claim, action or proceeding (whether brought in the right of the
Corporation or any such other corporation, entity, plan or otherwise), in
which he may become involved, as a party or otherwise, by reason of his
being or having been a director, officer or employee of the Corporation, or
such other corporation, entity or plan while serving at the request of the
Corporation, whether or not he continues to be such at the time such
liability or expense is incurred, unless such person engaged in willful
misconduct or a knowing violation of the criminal law.
As used in this Article VII: (a) the terms "liability" and "expense"
shall include, but shall not be limited to, counsel fees and disbursements
and amounts of judgments, fines or penalties against, and amounts paid in
settlement by, a director, officer or employee; (b) the terms "director,"
"officer" and employee," unless the context otherwise requires, include the
estate or personal representative of any such person; (c) a person is
considered to be serving an employee benefit plan as a director, officer or
employee of the plan at the Corporation's request if his duties to the
Corporation also impose duties on, or otherwise involve services by, him to
the plan or, in connection with the plan, to participants in or
beneficiaries of the plan; (d) the term "occurrence" means any act or
failure to act, actual or alleged, giving rise to a claim, action or
proceeding; and (e) service as a trustee or as a member of a management or
similar committee of a partnership, joint venture or limited liability
company shall be considered service as a director, officer or employee of
the trust, partnership, joint venture or limited liability company.
The termination of any claim, action or proceeding, civil or criminal,
by judgment, settlement, conviction or upon a plea of nolo contendere, or
its equivalent, shall not create a presumption that a director, officer or
employee did not meet the standards of conduct set forth in this paragraph
1. The burden of proof shall be on the Corporation to establish, by a
preponderance of the evidence, that the relevant standards of conduct set
forth in this paragraph 1 have not been met.
2. Any indemnification under paragraph 1 of this Article VII shall
be made unless (a) the Board, acting by a majority vote of those directors
who were directors at the time of the occurrence giving rise to the claim,
action or proceeding involved and who are not at the time parties to such
claim, action or proceeding (provided there are at least five such
directors), finds that the director, officer or employee has not met the
relevant standards of conduct set forth in such paragraph 1, or (b) if
there are not at least five such directors, the Corporation's principal
Virginia legal counsel, as last designated by the Board as such prior to
the time of the occurrence giving rise to the claim, action or proceeding
involved, or in the event for any reason such Virginia counsel is unwilling
to so serve, then Virginia legal counsel mutually acceptable to the
Corporation and the person seeking indemnification, deliver to the
Corporation their written advice that, in their opinion, such standards
have not been met.
3. Expenses incurred with respect to any claim, action or proceeding
of the character described in paragraph 1 shall, except as otherwise set
forth in this paragraph 3, be advanced by the Corporation prior to the
final disposition thereof upon receipt of an undertaking by or on behalf of
the recipient to repay such amount if it is ultimately determined that he
is not entitled to indemnification under this Article VII. No security
shall be required for such undertaking and such undertaking shall be
accepted without reference to the recipient's final ability to make
repayment. Notwithstanding the foregoing, the Corporation may refrain
from, or suspend, payment of expenses in advance if at any time before
delivery of the final finding described in paragraph 2, the Board or
Virginia legal counsel, as the case may be, acting in accordance with the
procedures set forth in paragraph 2, find by a preponderance of the
evidence then available that the officer, director or employee has not met
the relevant standards of conduct set forth in paragraph 1.
4. No amendment or repeal of this Article VII shall adversely affect
or deny to any director, officer or employee the rights of indemnification
provided in this Article VII with respect to any liability or expense
arising out of a claim, action or proceeding based in whole or substantial
part on an occurrence the inception of which takes place before or while
this Article VII, as set forth in these Amended and Restated Articles of
Incorporation, is in effect. The provisions of this paragraph 4 shall
apply to any such claim, action or proceeding whenever commenced, including
any such claim, action or proceeding commenced after any amendment or
repeal to this Article VII.
5. The rights of indemnification provided in this Article VII shall
be in addition to any rights to which any such director, officer or
employee may otherwise be entitled by contraction or as a matter of law.
6. In any proceeding brought by or in the right of the Corporation
or brought by or on behalf of shareholders of the Corporation, no director
or officer of the Corporation shall be liable to the Corporation or its
shareholders for monetary damages with respect to any transaction,
occurrence or course of conduct, whether prior or subsequent to the
effective date of this Article VII, except for liability resulting from
such person's having engaged in willful misconduct or a knowing violation
of the criminal law or any federal or state securities law.
EXHIBIT 3.2
BY-LAWS
OF
PRIMEX TECHNOLOGIES, INC.
AS AMENDED DECEMBER 31, 1996
----------------------------
ARTICLE I.
MEETINGS OF SHAREHOLDERS.
SECTION 1. PLACE OF MEETINGS. All meetings of the shareholders of Primex
Technologies, Inc. (hereinafter called the "Corporation") shall be held at such
place, either within or without the Commonwealth of Virginia, as may from time
to time be fixed by the Board of Directors of the Corporation (hereinafter
called the "Board").
SECTION 2. ANNUAL MEETINGS. The annual meeting of the shareholders of the
Corporation for the election of directors and for the transaction of such other
business as may properly come before the meeting shall be held on the first
Tuesday in May in each year (or, if that day shall be a legal holiday, then on
the next succeeding business day), or on such other day and/or in such other
month as may be fixed by the Board, at such hour as may be specified in the
notice thereof.
SECTION 3. ANNUAL MEETING BUSINESS. To be properly brought before an
annual meeting, business must be (i) specified in the notice of the meeting (or
any supplement thereto) given by or at the direction of the Board, (ii)
otherwise properly brought before the meeting by or at the direction of the
Board or (iii) otherwise properly brought before the meeting by a shareholder.
For business to be properly brought before an annual meeting by a shareholder,
the shareholder must have given written notice thereof, either by personal
delivery or by United States mail, postage prepaid, to the Secretary of the
Corporation, not later than 90 days in advance of such meeting (providing that
if the annual meeting of shareholders is held earlier than the first Tuesday in
May, such notice must be given within 10 days after the first public disclosure,
which may include any public filing with the Securities and Exchange Commission,
of the date of the annual meeting). Any such notice shall set forth as to each
matter the shareholder proposes to bring before the annual meeting (i) a brief
description of the business desired to be brought before the meeting and the
reasons for conducting such business at the meeting and in the event that such
business includes a proposal to amend either the Articles of Incorporation as
from time to time amended ("Articles") then in effect or By-laws of the
Corporation, the language of the proposed amendment, (ii) the name and address
of the shareholder proposing such business, (iii) a representation that the
shareholder is a holder of record of stock of the corporation entitled to vote
at such meeting and intends to appear in person or by proxy at the meeting to
propose such business, (iv) any material interest of the shareholder in such
business and (v) a representation as to whether or not the shareholder will
solicit proxies in support of his proposal. No business shall be conducted at
an annual meeting of shareholders except in accordance with this paragraph and
the chairman of any annual meeting of shareholders may refuse to permit any
business to be brought before an annual meeting which fails to comply with the
foregoing procedures or, in the case of a shareholder proposal, if the
shareholder fails to comply with the representations set forth in the notice.
SECTION 4. SPECIAL MEETINGS. A special meeting of the shareholders for
any purpose or purposes, unless otherwise provided by law or in the Articles,
may be held at any time only upon the call of the Board or the Chairman of the
Board.
SECTION 5. NOTICE OF MEETINGS. Except as otherwise provided by law or the
Articles, not less than ten nor more than sixty days' notice in writing of the
place, day, hour and purpose or purposes of each meeting of the shareholders,
whether annual or special, shall be given to each shareholder of record of the
Corporation entitled to vote at such meeting, either by the delivery thereof to
such shareholder personally or by the mailing thereof to such shareholder in a
postage prepaid envelope addressed to such shareholder at his address as it
appears on the stock transfer books of the Corporation. Notice of any meeting of
shareholders shall not be required to be given to any shareholder who shall
attend the meeting in person or by proxy, unless attendance is for the express
purpose of objecting to the transaction of any business because the meeting was
not lawfully called or convened, or who shall waive notice thereof in writing
signed by the shareholder before, at or after such meeting. Notice of any
adjourned meeting need not be given, except when expressly required by law.
SECTION 6. QUORUM. Shares representing a majority of the votes entitled
to be cast on a matter by each voting group entitled to vote thereon,
represented in person or by proxy at any meeting of the shareholders, shall
constitute a quorum of that voting group for the transaction of business thereat
with respect to such matter, unless otherwise provided by law or the Articles.
In the absence of a quorum at any such meeting or any adjournment or
adjournments thereof, shares representing a majority of the votes cast on the
matter of adjournment, either in person or by proxy, may adjourn such meeting
from time to time until a quorum is obtained. At any such adjourned meeting at
which a quorum has been obtained, any business may be transacted which might
have been transacted at the meeting as originally called.
SECTION 7. VOTING. Unless otherwise provided by law or the Articles, at
each meeting of the shareholders each shareholder entitled to vote at such
meeting shall be entitled to one vote for each share of stock standing in his
name on the books of the Corporation upon any date fixed as hereinafter
provided, and may vote either in person or by proxy in writing. Unless demanded
by a shareholder present in person or represented by proxy at any meeting of the
shareholders and entitled to vote thereon or so directed by the chairman of the
meeting, the vote on any matter need not be by ballot. On a vote by ballot,
each ballot shall be signed by the shareholder voting or his proxy, and it shall
show the number of shares voted.
SECTION 8. JUDGES. One or more judges or inspectors of election for any
meeting of shareholders may be appointed by the chairman of such meeting, for
the purpose of receiving and taking charge of proxies and ballots and deciding
all questions as to the qualification of voters, the validity of proxies and
ballots and the number of votes properly cast.
SECTION 9. CONDUCT OF MEETING. The chairman of the meeting at each
meeting of shareholders shall have all the powers and authority vested in
presiding officers by law or practice, without restriction, as well as the
authority to conduct an orderly meeting and to impose reasonable limits on the
amount of time taken up in remarks by any one shareholder.
ARTICLE II.
BOARD OF DIRECTORS.
SECTION 1. NUMBER, CLASSIFICATION, TERM, ELECTION. The property, business
and affairs of the Corporation shall be managed under the direction of the Board
as from time to time constituted. The Board shall consist of nine directors,
but the number of directors may be increased or decreased by amendment of this
Section 1 of Article II of these By-laws, provided that any increase or decrease
by more than thirty percent of the number of directors of all classes
immediately following the most recent election of directors by the shareholders
may only be effected by the shareholders. No director need be a shareholder.
The Board shall be divided into three classes, Class I, Class II and Class III,
as nearly equal in number as possible, with the members of each class to serve
for the respective terms of office provided in the Articles, and until their
respective successors shall have been duly elected or until death or resignation
or until removal in the manner hereinafter provided. In case the number of
directors shall be increased, the additional directors to fill the vacancies
caused by such increase shall be elected in accordance with the provisions of
Section 4 of Article V of these By-laws. Any increase or decrease in the number
of directors shall be so apportioned among the classes by the Board as to make
all classes as nearly equal in number as possible.
Subject to the rights of holders of any Preferred Stock outstanding,
nominations for the election of directors may be made by the Board or a
committee appointed by the Board or by any shareholder entitled to vote in the
election of directors generally. However, any shareholder entitled to vote in
the election of directors generally may nominate one or more persons for
election as directors at a meeting only if it is a meeting of shareholders for
the purposes of electing directors and written notice of such shareholder's
intent to make such nomination or nominations has been given, either by personal
delivery or by United States mail, postage prepaid, to the Secretary of the
Corporation not later than (i) with respect to an election to be held at an
annual meeting of shareholders, 90 days in advance of such meeting and (ii) with
respect to an election to be held at a special meeting of shareholders for the
election of directors, the close of business on the seventh day following the
date on which notice of such meeting is first given to shareholders. Each such
notice shall set forth: (a) the name and address of the shareholder who intends
to make the nomination and of the person or persons to be nominated; (b) a
representation that the shareholder is a holder of record of shares of the
Corporation entitled to vote at such meeting and intends to appear in person or
by proxy at the meeting to nominate the person or persons specified in the
notice; (c) a description of all arrangements or understandings between the
shareholder and each nominee and any other person or persons (naming such person
or persons) pursuant to which the nomination or nominations are to be made by
the shareholder; (d) a representation as to whether the shareholder intends to
solicit by proxy other shareholders in support of any nominee, (e) such other
information regarding each nominee proposed by such shareholder as would be
required to be included in a proxy statement filed pursuant to the proxy rules
of the Securities and Exchange Commission; and (f) the consent of each nominee
to serve as a director of the Corporation if so elected.
SECTION 2. COMPENSATION. Each director, in consideration of his serving
as such, shall be entitled to receive from the Corporation such amount per annum
or such fees for attendance at Board and Committee meetings, or both, in cash or
other property, including securities of the Corporation, as the Board shall from
time to time determine, together with reimbursements for the reasonable expenses
incurred by him in connection with the performance of his duties. Nothing
contained herein shall preclude any director from serving the Corporation, or
any subsidiary or affiliated corporation, in any other capacity and receiving
proper compensation therefor. If the Board adopts a resolution to that effect,
any director may elect to defer all or any part of the annual and other fees
hereinabove referred to for such period and on such terms and conditions as
shall be permitted by such resolution.
SECTION 3. PLACE OF MEETINGS. The Board may hold its meetings at such
place or places within or without the Commonwealth of Virginia as it may from
time to time by resolution determine or as shall be specified or fixed in the
respective notices or waivers of notice thereof.
SECTION 4. ORGANIZATION MEETING. After each annual election of directors,
as soon as conveniently may be, the newly constituted Board shall meet for the
purposes of organization. At such organization meeting, the newly constituted
Board shall elect officers of the Corporation and transact such other business
as shall come before the meeting. Notice of organization meetings of the Board
need not be given. Any organization meeting may be held at any other time or
place which shall be specified in a notice given as hereinafter provided for
special meetings of the Board, or in a waiver of notice thereof signed by all
the directors.
SECTION 5. REGULAR MEETINGS. Regular meetings of the Board may be held at
such time and place as may from time to time be specified in a resolution
adopted by the Board then in effect; and, unless otherwise required by such
resolution, or by law, notice of any such regular meeting need not be given.
SECTION 6. SPECIAL MEETINGS. Special meetings of the Board shall be held
whenever called by the Chairman of the Board or Chief Executive Officer, or by
the Secretary at the request of any three directors. Notice of a special meeting
shall be mailed to each director, addressed to him at his residence or usual
place of business, not later than the second day before the day on which such
meeting is to be held, or shall be sent addressed to him at such place by
facsimile transmission or e-mail, or be delivered personally or by telephone,
not later than the day before the day on which such meeting is to be held.
Neither the business to be transacted at, nor the purpose of, any regular or
special meeting of the Board need be specified in the notice of such meeting,
unless required by the Articles.
SECTION 7. QUORUM. At each meeting of the Board the presence of a
majority of the number of directors fixed by these By-laws shall be necessary to
constitute a quorum. The act of a majority of the directors present at a
meeting at which a quorum shall be present shall be the act of the Board, except
as may be otherwise provided by law or by these By-laws. Any meeting of the
Board may be adjourned by a majority vote of the directors present at such
meeting. Notice of any adjourned meeting need not be given.
SECTION 8. WAIVERS OF NOTICE OF MEETINGS. Anything in these By-laws or in
any resolution adopted by the Board to the contrary notwithstanding, notice of
any meeting of the Board need not be given to any director if such notice shall
be waived in writing signed by such director before, at or after the meeting, or
if such director shall be present at the meeting. Any meeting of the Board shall
be a legal meeting without any notice having been given or regardless of the
giving of any notice or the adoption of any resolution in reference thereto, if
every member of the Board shall be present thereat. Except as otherwise
provided by law or these By-laws, waivers of notice of any meeting of the Board
need not contain any statement of the purpose of the meeting.
SECTION 9. TELEPHONE MEETINGS. Members of the Board or any committee may
participate in a meeting of the Board or such committee by means of a conference
telephone or other means of communications whereby all directors participating
may simultaneously hear each other during the meeting, and participation by such
means shall constitute presence in person at such meeting.
SECTION 10. ACTIONS WITHOUT MEETINGS. Any action that may be taken at a
meeting of the Board or of a committee may be taken without a meeting if a
consent in writing, setting forth the action, shall be signed, either before or
after such action, by all of the directors or all of the members of the
committee, as the case may be. Such consent shall have the same force and
effect as a unanimous vote.
ARTICLE III.
COMMITTEES.
SECTION 1. EXECUTIVE AND FINANCE COMMITTEE. The Board may, by resolution
or resolutions adopted by a majority of the number of directors fixed by these
By-laws, appoint two or more directors to constitute an Executive and Finance
Committee, each member of which shall serve as such during the pleasure of the
Board, and may designate for such Committee a Chairman, who shall continue as
such during the pleasure of the Board.
All completed action by the Executive and Finance Committee shall be
reported to the Board at its meeting next succeeding such action or at its
meeting held in the month following the taking of such action, and shall be
subject to revision or alteration by the Board; provided, that no acts or rights
of third parties shall be affected by any such revision or alteration.
The Executive and Finance Committee shall fix its own rules of procedure
and shall meet where and as provided by such rules or by resolution of the
Board. At all meetings of the Executive and Finance Committee, a majority of
the full number of members of such Committee shall constitute a quorum, and in
every case the affirmative vote of a majority of members present at any meeting
of the Executive and Finance Committee at which a quorum is present shall be
necessary for the adoption of any resolution.
During the intervals between the meetings of the Board, the Executive and
Finance Committee shall possess and may exercise all the power and authority of
the Board (including, without limitation, all the power and authority of the
Board in the management, control and direction of the financial affairs of the
Corporation) except with respect to those matters reserved to the Board by
Virginia law, in such manner as the Executive and Finance Committee shall deem
best for the interests of the Corporation, in all cases in which specific
directions shall not have been given by the Board.
SECTION 2. OTHER COMMITTEES. To the extent permitted by law, the Board
may from time to time by resolution adopted by a majority of the number of
directors fixed by these By-laws create such other committees of directors,
officers, employees or other persons designated by it as the Board shall deem
advisable and with such limited authority, functions and duties as the Board
shall by resolution prescribe. The Board shall have the power to change the
members of any such committee at any time, to fill vacancies, and to discharge
any such committee, either with or without cause, at any time.
ARTICLE IV.
OFFICERS.
SECTION 1. NUMBER, TERM, ELECTION. The officers of the Corporation shall
be a Chief Executive Officer, a Chairman of the Board, a Vice Chairman, one or
more Vice Presidents, a Treasurer, and a Secretary. The Board may appoint such
other officers and such assistant officers and agents with such powers and
duties as the Board may find necessary or convenient to carry on the business of
the Corporation. Such officers and assistant officers shall serve until their
successors shall be chosen, or as otherwise provided in these By-laws. Any two
or more offices may be held by the same person.
SECTION 2. CHIEF EXECUTIVE OFFICER. The Chief Executive Officer shall,
subject to the control of the Board and the Executive and Finance Committee,
have full authority and responsibility for directing the conduct of the
business, affairs and operations of the Corporation. In addition to acting as
Chief Executive Officer of the Corporation, he shall perform such other duties
and exercise such other powers as may from time to time be prescribed by the
Board and shall see that all orders and resolutions of the Board and the
Executive and Finance Committee are carried into effect. In the event of the
inability of the Chief Executive Officer to act, the Board will designate an
officer of the Corporation to perform the duties of that office.
SECTION 3. CHAIRMAN OF THE BOARD. The Chairman of the Board shall preside
at all meetings of the Board and of the shareholders and, in the absence of the
Chairman of the Executive and Finance Committee, at all meetings of the
Executive and Finance Committee. He shall perform such other duties and
exercise such other powers as may from time to time be prescribed by the Board
or, if he shall not be the Chief Executive Officer, by the Chief Executive
Officer.
SECTION 4. VICE CHAIRMAN OF THE BOARD. The Vice Chairman of the Board, in
the absence of the Chairman of the Board, shall preside at all meetings of the
Board and of the shareholders. The Vice Chairman of the Board shall have such
powers, authority and duties as may be delegated to him from time to time by the
Board or the Chairman of the Board.
SECTION 5. VICE PRESIDENTS. Each Vice President shall have such powers
and perform such duties as may from time to time be prescribed by the Board, the
Chief Executive Officer or any officer to whom the Chief Executive Officer may
have delegated such authority. One Vice President shall be the principal
accounting officer of the Corporation with responsibility for keeping full and
accurate accounts of all assets, liabilities, receipts and disbursements and
other transactions of the Corporation and shall cause regular audits of the
books and records of the Corporation to be made. To such extent as the Board
shall deem proper, the duties of any Vice President may be performed by one or
more assistants, to be appointed by the Board.
SECTION 6. TREASURER. The Treasurer shall have the general care and
custody of the funds and securities of the Corporation. He shall perform such
other duties and exercise such other powers as may from time to time be
prescribed by the Board, the Chief Executive Officer or any officer to whom the
Chief Executive Officer may have delegated such authority. To such extent as
the Board shall deem proper, the duties of the Treasurer may be performed by one
or more assistants, to be appointed by the Board.
SECTION 7. SECRETARY. The Secretary shall keep the minutes of meetings of
shareholders, of the Board, and, when requested, of Committees of the Board; and
he shall attend to the giving and serving of notices of all meetings thereof.
He shall keep or cause to be kept such stock and other books, showing the names
of the shareholders of the Corporation, and all other particulars regarding
them, as may be required by law. He shall also perform such other duties and
exercise such other powers as may from time to time be prescribed by the Board,
the Chief Executive Officer or any officer to whom the Chief Executive Officer
may have delegated such authority. To such extent as the Board shall deem
proper, the duties of the Secretary may be performed by one or more assistants,
to be appointed by the Board.
ARTICLE V.
REMOVALS, RESIGNATIONS AND VACANCIES.
SECTION 1. REMOVAL OF DIRECTORS. Any director may be removed at any time
but only with cause, by the affirmative vote of the holders of record of a
majority of the shares of the Corporation entitled to vote on the election of
directors, given at a special meeting of the shareholders called expressly for
the purpose.
SECTION 2. REMOVAL OF OFFICERS. Any officer, assistant officer or agent
of the Corporation may be removed at any time, either with or without cause, by
the Board in its absolute discretion. Any such removal shall be without
prejudice to the recovery of damages for breach of the contract rights, if any,
of the officer, assistant officer or agent removed. Election or appointment of
an officer, assistant officer or agent shall not of itself create contract
rights.
SECTION 3. RESIGNATION. Any director, officer or assistant officer of the
Corporation may resign as such at any time by giving written notice of his
resignation to the Board, the Chief Executive Officer or the Secretary of the
Corporation. Such resignation shall take effect at the time specified therein
or, if no time is specified therein, at the time of delivery thereof, and,
unless otherwise specified therein, the acceptance of such resignation shall not
be necessary to make it effective.
SECTION 4. VACANCIES. Any vacancy in the Board caused by death,
resignation, disqualification, removal, an increase in the number of directors,
or any other cause, may be filled by the affirmative vote of a majority of the
remaining directors though less than a quorum of the Board at any regular or
special meeting thereof. Each director so elected by the Board shall hold
office until the next annual election of directors and until his successor shall
be elected, or until his death, or until he shall resign, or until he shall have
been removed in the manner hereinabove provided. Any vacancy in the office of
any officer or assistant officer caused by death, resignation, removal or any
other cause, may be filled by the Board for the unexpired portion of the term.
ARTICLE VI.
CONTRACTS, LOANS, CHECKS, DRAFTS, DEPOSITS, ETC.
SECTION 1. EXECUTION OF CONTRACTS. Except as otherwise provided by law or
by these By-laws, the Board (i) may authorize any officer, employee or agent of
the Corporation to execute and deliver any contract, agreement or other
instrument in writing in the name and on behalf of the Corporation, and (ii) may
authorize any officer, employee or agent of the Corporation so authorized by the
Board to delegate such authority by written instrument to other officers,
employees or agents of the Corporation. Any such authorization by the Board may
be general or specific and shall be subject to such limitations and restrictions
as may be imposed by the Board. Any such delegation of authority by an officer,
employee or agent may be general or specific, may authorize re-delegation, and
shall be subject to such limitations and restrictions as may be imposed in the
written instrument of delegation by the person making such delegation.
SECTION 2. LOANS. No loans shall be contracted on behalf of the
Corporation and no negotiable paper shall be issued in its name unless
authorized by the Board. When authorized by the Board, any officer, employee or
agent of the Corporation may effect loans and advances at any time for the
Corporation from any bank, trust company or other institution, or from any firm,
corporation or individual, and for such loans and advances may make, execute and
deliver promissory notes, bonds or other certificates or evidences of
indebtedness of the Corporation and when so authorized may pledge, hypothecate
or transfer any securities or other property of the Corporation as security for
any such loans or advances. Such authority may be general or confined to
specific instances.
SECTION 3. CHECKS, DRAFTS, ETC. All checks, drafts and other orders for
the payment of money out of the funds of the Corporation and all notes or other
evidences of indebtedness of the Corporation shall be signed on behalf of the
Corporation in such manner as shall from time to time be determined by the
Board.
SECTION 4. DEPOSITS. All funds of the Corporation not otherwise employed
shall be deposited from time to time to the credit of the Corporation in such
banks, trust companies or other depositories as the Board may select or as may
be selected by the Treasurer or any other officer, employee or agent of the
Corporation to whom such power may from time to time be delegated by the Board.
SECTION 5. VOTING OF SECURITIES. Unless otherwise provided by the Board,
the Chief Executive Officer may from time to time appoint an attorney or
attorneys, or agent or agents of the Corporation, in the name and on behalf of
the Corporation, to cast the votes which the Corporation may be entitled to cast
as the holder of stock or other securities in any other corporation, any of
whose stock or other securities may be held by the Corporation, at meetings of
the holders of the stock or other securities of such other corporation, or to
consent in writing, in the name of the Corporation as such holder, to any action
by such other corporation, and may instruct the person or persons so appointed
as to the manner of casting such votes or giving such consent, or the Chief
Executive Officer may directly cast such votes or execute such consents, and may
execute or cause to be executed in the name and on behalf of the Corporation and
under its corporate seal, or otherwise, all such written proxies or other
instruments as such officer may deem necessary or proper in the premises.
ARTICLE VII.
CAPITAL STOCK.
SECTION 1. CERTIFICATES. Every shareholder shall be entitled to a
certificate, or certificates, in such form as shall be approved by the Board,
signed by the Chairman of the Board, the Vice Chairman, the Chief Executive
Officer or a Vice President and the Secretary or an Assistant Secretary or the
Treasurer or an Assistant Treasurer or any other officer authorized by these By-
laws or a resolution of the Board, certifying the number of shares owned by him
in the Corporation. Any such certificate may, but need not, bear the seal of
the Corporation or a facsimile thereof. If any such certificate is
countersigned by a transfer agent or registered by a registrar other than the
Corporation or an employee of the Corporation, the signatures of any of the
officers above specified upon such certificate may be facsimiles. In case any
such officer who shall have signed or whose facsimile signature shall have been
placed upon such certificate shall have ceased to be such before such
certificate is issued, it may be issued by the Corporation with the same effect
as if such officer had not ceased to be such at the date of its issue.
SECTION 2. TRANSFERS. Shares of stock of the Corporation shall be
transferable on the stock books of the Corporation by the holder in person or by
his attorney thereunto authorized by power of attorney duly executed and filed
with the Secretary or the transfer agent, but, except as hereinafter provided in
the case of loss, destruction or mutilation of certificates, no transfer of
stock shall be entered until the previous certificate, if any, given for the
same shall have been surrendered and canceled. Except as otherwise provided by
law, no transfer of shares shall be valid as against the Corporation, its
shareholders or creditors, for any purpose, until it shall have been entered in
the stock records of the Corporation by an entry showing from and to whom
transferred. The Board may also make such additional rules and regulations as
it may deem expedient concerning the issue and transfer of certificates
representing shares of the capital stock of the Corporation.
SECTION 3. RECORD DATE. For the purpose of determining shareholders
entitled to notice of or to vote at any meeting of shareholders or any
adjournment thereof, or entitled to receive payment of any dividend, or in order
to make a determination of shareholders for any other proper purpose, the Board
may fix in advance a date as the record date for any such determination of
shareholders, such date in any case to be not more than seventy days prior to
the date on which the particular action, requiring such determination of
shareholders, is to be taken. When a determination of shareholders entitled to
vote at any meeting of shareholders has been made as provided in this section,
such determination shall apply to any adjournment thereof unless the Board fixes
a new record date, which it shall do if the meeting is adjourned to a date more
than 120 days after the date fixed for the original meeting.
SECTION 4. LOST, DESTROYED OR MUTILATED CERTIFICATES. In case of loss,
destruction or mutilation of any certificate of stock, another may be issued in
its place upon proof of such loss, destruction or mutilation and upon the giving
of a bond of indemnity to the Corporation in such form and in such sum as the
Board may direct; provided that a new certificate may be issued without
requiring any bond when, in the judgment of the Board, it is proper so to do.
SECTION 5. CONTROL SHARE ACQUISITIONS. Article 14.1 of Chapter 9 of Title
13.1 of the Code of Virginia shall not apply to acquisitions of shares of the
Corporation.
ARTICLE VIII.
INSPECTION OF RECORDS.
The Board from time to time shall determine whether, to what extent, at
what times and places, and under what conditions and regulations the accounts
and books and papers of the Corporation, or any of them, shall be open for the
inspection of the shareholders, and no shareholder shall have any right to
inspect any account or book or paper of the Corporation except as expressly
conferred by statute or by these By-laws or authorized by the Board.
ARTICLE IX.
AUDITOR.
The Board shall annually appoint an independent accountant who shall
carefully examine the books of the Corporation. One such examination shall be
made immediately after the close of the fiscal year and be ready for
presentation at the annual meeting of shareholders of the Corporation, and such
other examinations shall be made as the Board may direct.
ARTICLE X.
SEAL.
The seal of the Corporation shall be circular in form and shall bear the
name of the Corporation and the year "1996."
ARTICLE XI.
FISCAL YEAR.
The fiscal year of the Corporation shall end on the 31st day of December in
each year.
ARTICLE XII.
AMENDMENTS.
The By-laws of the Corporation may be altered, amended or repealed and new
By-laws may be adopted by the Board (except as Section 1 of Article II may
otherwise require), or by the holders of the outstanding shares of the
Corporation entitled to vote generally at any annual or special meeting of the
shareholders when notice thereof shall have been given in the notice of the
meeting of shareholders; provided however, that, notwithstanding any other
provisions of these By-laws, the Articles, or applicable law, the affirmative
vote of at least 80 percent of the outstanding shares of the Corporation
entitled to vote generally at any annual or special meeting of the shareholders
shall be required for the holders of such outstanding shares to alter, amend or
repeal Article I Section 4 or Article II Section 1 of these By-laws or this
proviso to this Article XII of these By-laws.
EMERGENCY BY-LAWS.
SECTION 1. DEFINITIONS. As used in these Emergency By-laws,
(a) the term "period of emergency" shall mean any period during which a
quorum of the Board cannot readily be assembled because of some catastrophic
event.
(b) the term "incapacitated" shall mean that the individual to whom such
term is applied shall not have been determined to be dead but shall be missing
or unable to discharge the responsibilities of his office; and
(c) the term "senior officer" shall mean the Chairman of the Board, the
Vice Chairman, the Chief Executive Officer, any Vice President, the Treasurer
and the Secretary, and any other person who may have been so designated by the
Board before the beginning of the period of emergency.
SECTION 2. APPLICABILITY. These Emergency By-laws, as from time to time
amended, shall be operative only during any period of emergency. To the extent
not inconsistent with these Emergency By-laws, all provisions of the regular By-
laws of the Corporation shall remain in effect during any period of emergency.
No officer, director or employee shall be liable for actions taken in good
faith in accordance with these Emergency By-laws.
SECTION 3. BOARD OF DIRECTORS. (a) A meeting of the Board may be called
by any director or senior officer of the Corporation. Notice of any meeting of
the Board need be given only to such of the directors as it may be feasible to
reach at the time and by such means as may be feasible at the time, including
publication or radio, and at a time less than twenty-four hours before the
meeting if deemed necessary by the person giving notice.
(b) At any meeting of the Board, three directors in attendance shall
constitute a quorum. Any act of a majority of the directors present at a
meeting at which a quorum shall be present shall be the act of the Board. If
fewer than three directors shall be present at a meeting of the Board, any
senior officer of the Corporation in attendance at such meeting shall serve as a
director for such meeting, selected in order of rank and within the same rank in
order of seniority.
(c) In addition to the Board's powers under the regular By-laws of the
Corporation to fill vacancies on the Board, the Board may elect any individual
as a director to replace any director who may be incapacitated and to serve
until the latter ceases to be incapacitated or until the termination of the
period of emergency, whichever first occurs. In considering officers of the
Corporation for election to the Board, the rank and seniority of individual
officers shall not be pertinent.
(d) The Board, during as well as before any such period of emergency, may
change the principal office or designate several alternative offices or
authorize the officers to do so.
SECTION 4. APPOINTMENT OF OFFICERS. In addition to the Board's powers
under the regular By-laws of the Corporation with respect to the election of
officers, the Board may elect any individual as an officer to replace any
officer who may be incapacitated and to serve until the latter ceases to be
incapacitated.
SECTION 5. AMENDMENTS. These Emergency By-laws shall be subject to repeal
or change by further action of the Board of Directors or by action of the
shareholders, except that no such repeal or change shall modify the provisions
of the second paragraph of Section 2 with regard to action or inaction prior to
the time of such repeal or change. Any such amendment of these Emergency By-
laws may make any further or different provision that may be practical and
necessary for the circumstances of the emergency.
Exhibit 10.2
TECHNOLOGY TRANSFER AND LICENSE AGREEMENT
by and between
OLIN CORPORATION
and
PRIMEX TECHNOLOGIES, INC.
TABLE OF CONTENTS
1. Definitions..................................3
2. Assignment of Intellectual Property..........7
3. Licenses.....................................8
4. Secrecy.....................................10
5. Duration and Termination....................12
6. Rights Upon Termination Other
Than Under Section 6.1....................12
7. Force Majeure...............................13
8. Guarantees, Liabilities and Indemnities.....13
9. Notices.....................................14
10. Exportation Control.........................14
11. Assignment..................................14
12. Miscellaneous...............................15
13. Settlement of Disputes......................16
EXHIBIT A.......................................18
EXHIBIT B.......................................19
TECHNOLOGY TRANSFER AND LICENSE AGREEMENT
THIS AGREEMENT is made and entered into as of December 30, 1996, by and between:
OLIN CORPORATION, having a place of business at 427 North Shamrock Street, East
Alton, Illinois 62024, (hereinafter referred to as "OLIN")
AND
PRIMEX TECHNOLOGIES, INC., having a place of business at 10101 Ninth Street
North, St. Petersburg, Florida 33716-3807 (hereinafter referred to as "PRIMEX")
(hereinafter collectively the "PARTIES " and each individually a "PARTY").
W I T N E S S E T H:
WHEREAS, OLIN and PRIMEX are contemplating entering into a Distribution
Agreement concerning the spin-off of PRIMEX from OLIN (the "Distribution
Agreement");
WHEREAS, prior to entering into the Distribution Agreement, OLIN possesses
certain INTELLECTUAL PROPERTY and TECHNOLOGY primarily used in the PRIMEX
business, as that business was part of a single corporate entity and parent-
subsidiary corporate structure;
WHEREAS, PRIMEX desires to own or have the right to use such certain
INTELLECTUAL PROPERTY and TECHNOLOGY used its business;
WHEREAS, to allow each of OLIN and PRIMEX (and their respective shareholders) to
obtain the full value of its respective rights under the Distribution Agreement,
PRIMEX and OLIN desire to enter into and execute this AGREEMENT concerning the
assignment and licensing of certain INTELLECTUAL PROPERTY and TECHNOLOGY;
NOW, THEREFORE, in consideration of the above, and the mutual promises set forth
below, OLIN and PRIMEX agree as follows:
1. DEFINITIONS
Whenever used in this agreement, the following terms shall have the following
meanings, on the understanding that words in the singular include the plural and
vice-versa. Headings and subheadings are used for convenience only and are not
intended as limitations in the AGREEMENT or for use in interpreting the
AGREEMENT.
1.1 AFFILIATE
"AFFILIATE" shall mean, when used with respect to a specified PERSON, another
PERSON that directly, or indirectly through one or more intermediaries, CONTROLS
or is CONTROLLED by or is under common CONTROL with the PERSON specified.
1.2 AGREEMENT
"AGREEMENT" shall mean this agreement as amended and/or supplemented from time
to time, including all the EXHIBITS attached hereto.
1.3 AMMUNITION
"AMMUNITION" shall mean cartridges, shotshells, projectiles, and blanks, capable
of being fired from a firearm, artillery piece, cannon, industrial gun or other
gun (collectively "Gun") by a propellant charge in such Gun or cartridge
(including but not limited to armor-piercing rounds, trace rounds, incendiary
rounds and/or explosive rounds), but shall not include (i) unpropelled bombs,
and (ii) rockets, mortars and other projectiles substantially propelled by
propellant contained within the projectile.
1.4 CONFIDENTIAL INFORMATION
"CONFIDENTIAL INFORMATION" shall mean any and all information disclosed to the
receiving PARTY by the disclosing PARTY pursuant to the AGREEMENT, in any form
such as, but not limited to, visual, oral, written, graphic, electronic or model
form, including but not limited to know-how and trade secrets, whether patented
or not and whether in the laboratory, pilot plant or commercial plant stage
(including drawings, operating conditions, specifications, safety instructions,
recommendations for effluent disposal, emergency instructions, etc.) owned or
controlled by a PARTY.
1.5 CONTROL
"CONTROL" shall mean the possession, directly or indirectly, of the power to
direct or cause the direction of the management or policies of a Person, whether
through the ownership of voting securities, by contract or otherwise, and the
terms "CONTROLLING" and "CONTROLLED" shall have meanings correlative thereto.
1.6 EFFECTIVE DATE
"EFFECTIVE DATE" shall mean the Effective Time specified in the Distribution
Agreement.
1.7 GOCO OPERATION
"GOCO OPERATION" shall mean any activity conducted by a Party hereto pursuant to
an agreement existing on or prior to the date first above written (or an
extension, renewal or other continuation of such an agreement concerning the
same facility as the prior agreement) with the federal government of the United
States of America by which such party operates or maintains an AMMUNITION or
AMMUNITION components (including powder) production facility for and on behalf
of such government; provided, however, that such term shall not include any
activity conducted at such facility that is not conducted by the respective
party on behalf of such government pursuant to such agreement (such as, but not
limited to, activity conducted by a respective party for its own account at such
facility, whether pursuant to a facilities use agreement with the government or
otherwise).
1.8 INTELLECTUAL PROPERTY
"INTELLECTUAL PROPERTY" shall mean all classes or types of patents, utility
models, design patents, copyrights and applications for the aforementioned, of
all countries of the world, owned by a PARTY and in existence on or before the
EFFECTIVE DATE.
1.9 JOINT TECHNOLOGY
"JOINT TECHNOLOGY" shall mean TECHNOLOGY in existence on or before the EFFECTIVE
DATE which (i) was derived from the joint efforts or used (a) by or on behalf of
OLIN's Ordnance and/or Aerospace divisions on the one hand and (b) by or on
behalf of OLIN's Brass and/or Chemicals and/or Chlor-Alkali Products and/or
Winchester and/or Olin Microelectronic Materials, Divisions on the other hand or
(ii) is neither OLIN TECHNOLOGY nor PRIMEX TECHNOLOGY.
1.10 MEDIUM & LARGE CALIBER AMMUNITION & COMPONENTS
"MEDIUM & LARGE CALIBER AMMUNITION & COMPONENTS" shall mean (i) fully-loaded
rounds of Ammunition having a diameter of 20 millimeters or larger, other than
shotshells and (ii) components of such fully-loaded rounds.
1.11 NONLETHAL AMMUNITION
"NONLETHAL AMMUNITION" shall mean AMMUNITION that is designed and intended to
minimize or avoid any injury, damage or death resulting from its use or
otherwise intended to be less-than-lethal, including but not limited to having
the effect of slowing or temporarily incapacitating an aggressor through means
intended to minimize or avoid permanent physical damage to the aggressor. The
term "NONLETHAL AMMUNITION" does not include: (i) blanks, and (ii) any
AMMUNITION produced on or before the EFFECTIVE DATE by the parties hereto, nor
any developments therefrom based on techniques historically used in the
AMMUNITION industry for delivering lethal or injurious force to an aggressor
through the use of a metal projectile.
1.12 OCSW & OICW AMMUNITION
"OCSW AND OICW AMMUNITION" shall mean AMMUNITION used in objective crew served
weapon (OCSW) and objective individual combat weapon (OICW), respectively, being
developed by PRIMEX for the U.S. Army.
1.13 OLIN BUSINESSES
"OLIN BUSINESSES" shall mean the businesses of the Brass, Chlor Alkali Products,
Chemicals, Winchester and Microelectronic Materials, Divisions of OLIN as they
were carried out on or before the EFFECTIVE DATE but excluding Ball Powder[R].
1.14 OLIN TECHNOLOGY
"OLIN TECHNOLOGY" shall mean all the TECHNOLOGY, other than JOINT TECHNOLOGY,
which was used by or derived from efforts by or on behalf of the Brass, Chlor
Alkali Products, Chemicals, Winchester and Microelectronic Materials, divisions
of Olin Corporation on or before the EFFECTIVE DATE.
1.15 OLIN INTELLECTUAL PROPERTY
"OLIN INTELLECTUAL PROPERTY" shall mean the INTELLECTUAL PROPERTY owned by OLIN
on or before the EFFECTIVE DATE other than the PRIMEX INTELLECTUAL PROPERTY.
1.16 OLIN PRODUCTS
"OLIN PRODUCTS" shall mean those products which were made by the Brass, Chlor
Alkali Products, Chemicals, Winchester and Microelectronic Materials, divisions
of OLIN on or before the EFFECTIVE DATE and products acquired, developed or
established by or for OLIN or any of its AFFILIATEs after the EFFECTIVE DATE.
Notwithstanding the foregoing, OLIN PRODUCTS shall, without limitation, NOT
include MEDIUM & LARGE CALIBER AMMUNITION & COMPONENTS and Ball Powder[R] except
for: (i) individual component primers, fuses, cups, propellants containing or
derived from HAN (hydroxyamoniumnitrate), shellcases, and cones for shaped
charges prior to their assembly into AMMUNITION, and/or oil well penetrator
cones; and/or (ii) engaging in research and development of propellant powder as
part of the development, testing, trial production, prototype construction, and
similar activities in the business relating to SMALL CALIBER AMMUNITION &
COMPONENTS; and/or (iii) engaging In any of its GOCO OPERATIONS, including the
Lake City Army Ammunition Plant located in Independence, Missouri and the
Ravenna Army Arsenal Plant located in Ravenna, Ohio; and/or (iv) engaging In the
business relating to NONLETHAL AMMUNITION; and/or (v) engaging In the business
relating to high explosives and other primer material.
1.17 PERSON
"PERSON" shall mean any natural person, corporation, business trust, joint
venture, association, company, partnership or government, or any agency or
political sub-division thereof.
1.18 PRIMEX BUSINESSES
"PRIMEX BUSINESSES" shall mean the businesses of the Ordnance and Aerospace
Divisions of OLIN as they were carried out on or before the EFFECTIVE DATE.
1.19 PRIMEX PRODUCTS
"PRIMEX PRODUCTS" shall mean those products which were made by the Ordnance and
Aerospace divisions of OLIN or their constituent companies and their predecessor
companies on or before the EFFECTIVE DATE and products acquired, developed or
established by or for PRIMEX or any of its AFFILIATES after the EFFECTIVE DATE.
Notwithstanding the forgoing, PRIMEX PRODUCTS shall, without limitation, NOT
include, SMALL CALIBER AMMUNITION & COMPONENTS except for: (i) engaging in the
development, testing, trial production, prototype construction and similar
activities associated with, but for the first five years after the EFFECTIVE
DATE not the selling of, OCSW AND OICW AMMUNITION; and/or (ii) engaging In the
business relating to NONLETHAL AMMUNITION.
1.20 PRIMEX TECHNOLOGY
"PRIMEX TECHNOLOGY" shall mean all the TECHNOLOGY, other than JOINT TECHNOLOGY,
which was used by or derived from efforts by or on behalf of the Ordnance and
Aerospace Divisions of OLIN or their constituent companies and their
predecessors on or before the EFFECTIVE DATE .
1.21 PRIMEX INTELLECTUAL PROPERTY
"PRIMEX INTELLECTUAL PROPERTY" shall mean the INTELLECTUAL PROPERTY set forth in
EXHIBIT A.
1.22 PRODUCTS
"PRODUCTS" shall mean the OLIN PRODUCTS and the PRIMEX PRODUCTS.
1.23 SMALL CALIBER AMMUNITION & COMPONENTS
"SMALL CALIBER AMMUNITION & COMPONENTS" shall mean (i) shotshells of any gauge,
(ii) fully-loaded rounds of AMMUNITION, other than MEDIUM & LARGE CALIBER
AMMUNITION & COMPONENTS, (iii) components of such shotshells and fully-loaded
rounds, other than propellant powder; and (iv) ejection cartridges (also known
as "ARDs") for aircraft stores ejection.
1.24 TECHNOLOGY
"TECHNOLOGY" shall mean the body of knowledge owned by a PARTY and in existence
as of the EFFECTIVE DATE including: (i) information such as technical,
engineering, maintenance, environmental and safety information with respect to
the design, equipment selection, construction, installation, staffing and
operation of facilities and equipment for the manufacture of PRODUCTS; (ii)
formulae, process drawings and descriptions, chemical recipes, know-how, and
technological and processing information, for the manufacture of PRODUCTS; and
(iii) specifications and properties of the PRODUCTS.
1.25 TERM
"TERM" shall mean the period of time during which the AGREEMENT shall be in full
force and effect pursuant to ARTICLE 6.
2. ASSIGNMENT OF INTELLECTUAL PROPERTY
2.1 ASSIGNMENT
OLIN agrees to assign and transfer to PRIMEX as of the EFFECTIVE DATE all of its
right, title and interest, together with all rights of priority, in and to the
PRIMEX INTELLECTUAL PROPERTY and to the PRIMEX TECHNOLOGY, which were owned by
OLIN as of December 30, 1996, pursuant to assignment documents in the form as
set forth in EXHIBIT B.
2.2 DISCLAIMER
OLIN CORPORATION MAKES NO REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, WITH
RESPECT TO THE INTELLECTUAL PROPERTY OR TECHNOLOGY ASSIGNED HEREBY, INCLUDING
WITHOUT LIMITATION AS TO THEIR VALIDITY, ENFORCEABILITY OR FITNESS FOR ANY
PARTICULAR USE OR PURPOSE.
3. LICENSES
3.1 GENERAL LICENSE TO PRIMEX
OLIN and its AFFILIATES hereby grant to PRIMEX an irrevocable, royalty free,
worldwide, nonexclusive license, with the right to sublicense, to use the OLIN
TECHNOLOGY AND OLIN INTELLECTUAL PROPERTY, which have been used by or on behalf
of the PRIMEX BUSINESSES on or before the EFFECTIVE DATE, solely for the making,
having made, use, offering for sale, selling and import of PRIMEX PRODUCTS,
provided that no rights or licenses are granted with respect to PRODUCTS other
than PRIMEX PRODUCTS. OLIN and its AFFILIATES hereby further grant to PRIMEX an
irrevocable, royalty free, worldwide, nonexclusive license, with the right to
sublicense, to use the OLIN INTELLECTUAL PROPERTY and the OLIN TECHNOLOGY, which
has been used by PRIMEX in the PRIMEX BUSINESSES on or before the EFFECTIVE DATE
solely for engaging in any GOCO OPERATIONS.
3.2 JOINT PROPERTY LICENSE TO PRIMEX
OLIN and its AFFILIATES hereby grant to PRIMEX an irrevocable, royalty free,
worldwide, nonexclusive license, with the right to sublicense, to use the JOINT
INTELLECTUAL PROPERTY and JOINT TECHNOLOGY solely for the making, having made,
use, offering for sale, selling and import of PRIMEX PRODUCTS. No rights or
licenses are granted with respect to PRODUCTS other than PRIMEX PRODUCTS.
3.3 PRIMEX OPTION FOR FUTURE LICENSE
OLIN and its AFFILIATES hereby grant to PRIMEX an option to nonexclusively
license, upon reasonable terms and conditions to be agreed upon, the use of the
OLIN TECHNOLOGY AND OLIN INTELLECTUAL PROPERTY known to PRIMEX on or before the
EFFECTIVE DATE but which have not been used by or on behalf of the PRIMEX
BUSINESSES on or before the EFFECTIVE DATE, solely for the making, having made,
use, offering for sale, selling and import of PRIMEX PRODUCTS, provided that no
rights or licenses will be granted with respect to PRODUCTS other than PRIMEX
PRODUCTS.
3.4 GENERAL LICENSE TO OLIN
PRIMEX and its AFFILIATES hereby grant to OLIN an irrevocable, royalty free,
worldwide, nonexclusive license, with the right to sublicense, to use the PRIMEX
INTELLECTUAL PROPERTY and the PRIMEX TECHNOLOGY, which have been used by or on
behalf of OLIN in the OLIN BUSINESSES on or before the EFFECTIVE DATE, solely
for the making, having made, use, offering for sale, selling and import of OLIN
PRODUCTS, provided that no rights or licenses are granted with respect to
PRODUCTS other than OLIN PRODUCTS. PRIMEX and its AFFILIATES hereby further
grant to OLIN an irrevocable, royalty free, worldwide, nonexclusive license,
with the right to sublicense, to use the PRIMEX INTELLECTUAL PROPERTY and the
PRIMEX TECHNOLOGY, which has been used by OLIN in the OLIN BUSINESSES on or
before the EFFECTIVE DATE solely for engaging in any GOCO OPERATIONS.
3.5 JOINT PROPERTY LICENSE TO OLIN
PRIMEX and its AFFILIATES hereby grant OLIN an irrevocable, royalty free,
worldwide, nonexclusive license, with the right to sublicense, to use the JOINT
INTELLECTUAL PROPERTY and JOINT TECHNOLOGY solely for the making, having made,
use, offering for sale, selling and import of OLIN PRODUCTS. No rights or
licenses are granted with respect to PRODUCTS other than OLIN PRODUCTS.
3.6 OLIN OPTION FOR FUTURE LICENSE
PRIMEX and its AFFILIATES hereby grant to OLIN an option to nonexclusively
license, upon reasonable terms and conditions to be agreed upon, the use of the
PRIMEX TECHNOLOGY AND PRIMEX INTELLECTUAL PROPERTY known to OLIN on or before
the EFFECTIVE DATE but which have not been used by or on behalf of the OLIN
BUSINESSES on or before the EFFECTIVE DATE, solely for the making, having made,
use, offering for sale, selling and import of OLIN PRODUCTS, provided that no
rights or licenses will be granted with respect to PRODUCTS other than OLIN
PRODUCTS.
3.7 CONTINGENT LICENSE TO OLIN
The PARTIES acknowledge that OLIN has guaranteed the performance of PRIMEX with
respect to certain contracts with the government of the United States of America
(hereinafter referred to as the "Government Contracts"). In the event of a
default by PRIMEX under such Government Contracts and the exercise by the
government of its rights under the OLIN guarantee, PRIMEX and its AFFILIATES
hereby grant to OLIN a royalty free, worldwide, nonexclusive license, with the
right to sublicense, to use the PRIMEX TECHNOLOGY and PRIMEX INTELLECTUAL
PROPERTY and any OLIN TECHNOLOGY or OLIN INTELLECTUAL PROPERTY subject to the
licenses of Section 3.1 for the sole purpose of enabling OLIN to fulfill
PRIMEX's obligations under such Government Contracts defaulted by PRIMEX. In
such event PRIMEX and its AFFILIATES agree to cooperate with OLIN and take all
reasonable actions which are deemed necessary by OLIN to enable OLIN to fulfill
PRIMEX's or its AFFILIATE's obligations under such Government Contracts,
including without limitation, disclosing to OLIN any PRIMEX TECHNOLOGY
reasonably requested by OLIN in order to fulfill such obligations.
3.8 SUBLICENSE TERMS
Any sublicense granted pursuant to this ARTICLE 3 shall be consistent with and
subject to the terms and conditions of this AGREEMENT.
3.9 LIMITATIONS
Notwithstanding any other provision of this AGREEMENT, no PARTY or its
AFFILIATES shall be obligated to: (i) grant any license, or make any disclosure,
to the other PARTY, with respect to INTELLECTUAL PROPERTY, owned or controlled
by such PARTY or its AFFILIATES, if to do so would violate an agreement with an
unrelated third party or (ii) grant any license, to the other PARTY, with
respect to INTELLECTUAL PROPERTY, which are owned or controlled by such PARTY or
its AFFILIATES, if to do so would be in violation of law. If the violation can
be avoided by a lesser license, then the PARTIES or their AFFILIATES agree to
grant same to the extent possible. The PARTIES or their AFFILIATES shall use
reasonable commercial efforts to avoid such restrictions in agreements entered
into following the EFFECTIVE DATE. PRIMEX hereby acknowledges, without
limitation, that OLIN has granted an exclusive license to a third party with
respect to shaped charge liners for oil field applications which are covered by
a certain OLIN patent. Notwithstanding any other provision of this AGREEMENT,
following the EFFECTIVE DATE, neither PARTY or their AFFILIATES shall be
obligated to make any further disclosure to the other PARTY with respect to any
TECHNOLOGY or INTELLECTUAL PROPERTY licensed hereunder.
3.10 THIRD PARTY ROYALTIES
If a licensor under this ARTICLE 3 is obligated to pay royalties to a third
party with respect to a license or right granted herein, then notwithstanding
the above, the licensee shall be obligated to pay such royalties as a condition
of its license.
3.11 WARRANTY
The PARTIES warrant that, except as set forth in this Agreement, they have not
granted and will not grant any licenses which will conflict with the rights and
licenses set forth in this AGREEMENT. The PARTIES also warrant that they have
the right to grant the rights and licenses set forth in this Agreement. NO
OTHER WARRANTY, OF ANY KIND, WHETHER EXPRESS OR IMPLIED, IS GIVEN BY ONE PARTY
TO THE OTHER PARTY AND IN PARTICULAR THE PARTIES DISCLAIM ANY WARRANTY THAT
THEIR RESPECTIVE INTELLECTUAL PROPERTY ARE VALID OR ENFORCEABLE OR USEFUL FOR
ANY PURPOSE.
3.12 EXPRESS LICENSES ONLY
Except for licenses expressly granted pursuant to ARTICLE 3, no licenses are
granted hereby, and nothing in the AGREEMENT shall be construed as, or result
in, conveying by implication, waiver or estoppel any right or license to either
PARTY or to any third party.
3.13 ABANDONING INTELLECTUAL PROPERTY
If either PARTY wishes to abandon in any country any INTELLECTUAL PROPERTY right
or application therefor licensed hereunder, it shall not do so without first
notifying the other PARTY and giving it a reasonable opportunity to take over
the prosecution or maintenance of such INTELLECTUAL PROPERTY right at its own
expense. If the other PARTY agrees to take over the prosecution and maintenance
of such INTELLECTUAL PROPERTY the abandoning PARTY shall transfer its interest
therein to such other PARTY.
4. SECRECY
4.1 SECRECY OBLIGATION
Each of the PARTIES agrees to keep confidential and neither disclose to others
nor use except as permitted herein any CONFIDENTIAL INFORMATION received from
the other PARTY or its AFFILIATES pursuant to the AGREEMENT.
4.2 LIMITS ON DISCLOSURE
The receiving PARTY shall treat such CONFIDENTIAL INFORMATION in the same manner
and with the same degree of care as it uses with respect to its own CONFIDENTIAL
INFORMATION of like nature and shall disclose CONFIDENTIAL INFORMATION of the
other PARTY only to its employees who have a need to know it, provided that such
employees are bound to respect all secrecy obligations provided for in the
AGREEMENT.
4.3 EXCEPTIONS
The obligation set forth in Section 4.1 shall not apply with respect to any
CONFIDENTIAL INFORMATION which:
4.3.1 PUBLIC KNOWLEDGE
Is generally available to the public or subsequently becomes generally available
to the public through no breach by the receiving PARTY of secrecy obligations
under this Agreement or prior agreements between the PARTIES concerning the
CONFIDENTIAL INFORMATION; or
4.3.2 RECEIVED FROM THIRD PARTY
Is received from a third party who is legally free to disclose such CONFIDENTIAL
INFORMATION and who did not receive such CONFIDENTIAL INFORMATION in confidence
from the disclosing PARTY; or
4.3.3 APPROVED FOR DISCLOSURE
Is approved in writing for release by the disclosing PARTY or its AFFILIATES; or
4.3.4 SUCCESSOR IN INTEREST
Is disclosed to any permitted assignee of the AGREEMENT, provided that such
assignee agrees to be bound by the provisions of the AGREEMENT; or
4.3.5 INDEPENDENTLY DEVELOPED
Is independently developed by the receiving PARTY without reference to the
CONFIDENTIAL INFORMATION received from the disclosing PARTY or its AFFILIATES.
4.4 PERMITTED DISCLOSURES
The provisions of Section 4.1 notwithstanding, in exercising the rights granted
under the AGREEMENT, any PARTY may disclose CONFIDENTIAL INFORMATION to others
for purpose of licensing (as permitted hereunder), design, engineering,
construction or operation of permitted facilities using the disclosing PARTY's
or its AFFILIATES licensed TECHNOLOGY; or obtaining or giving consulting
services under a license agreement permitted hereunder, provided that any third
party, to which such CONFIDENTIAL INFORMATION is disclosed shall have first
entered into a written secrecy and non-use obligation at least as stringent as
that imposed on the PARTIES pursuant to the AGREEMENT.
4.5 SUBPOENA OR DEMAND
The provisions of Section 4.1 notwithstanding, a PARTY may disclose CONFIDENTIAL
INFORMATION pursuant to a subpoena or demand for production of documents in
connection with any suit or arbitration proceeding, any administrative procedure
or before a governmental or administrative agency or instrumentality thereof or
any legislative hearing or other similar proceeding, provided that the receiving
PARTY shall promptly notify the disclosing PARTY or its AFFILIATES of the
subpoena or demand and provided further that in such instances, the PARTIES use
their best efforts to maintain the confidential nature of the CONFIDENTIAL
INFORMATION by protective order or other means.
5. DURATION AND TERMINATION
5.1 TERM OF AGREEMENT
This AGREEMENT shall become effective on the EFFECTIVE DATE, and shall continue
in full force and effect until the expiration of the last to expire of the
INTELLECTUAL PROPERTY licensed hereunder or ten (10) years from the EFFECTIVE
DATE, which ever is greater, at which time it shall terminate unless renewed by
agreement of the PARTIES. After expiration of the AGREEMENT pursuant to this
Section 5.1 the rights and obligations set forth in ARTICLES 3, 4, and 10 shall
survive.
5.2 TERMINATION FOR MATERIAL BREACH
If either PARTY commits a material breach with respect to any of their
obligations hereunder, the other PARTY may give written notice to the allegedly
breaching PARTY specifying the alleged material breach and an intention to
terminate the AGREEMENT. The PARTY charged with the alleged material breach
shall have sixty (60) days from the date of receipt of such written notice to
cure the alleged material breach. If the alleged material breach is not cured
within said sixty (60)-day period, the other PARTY may terminate the AGREEMENT
by sending a written notice of termination to the breaching PARTY and in this
event, neither PARTY waives any legal rights to recover damages resulting from
the termination of the AGREEMENT.
5.3 INSOLVENCY
In the event that either PARTY shall: (i) become insolvent or go into
liquidation or receivership or be admitted to the benefits of any procedure for
the settlement or postponement of debts or be declared bankrupt; or (ii) become
party to dissolution proceedings; then the AGREEMENT and any and all obligations
assumed hereby (except as otherwise expressly provided for herein) may be
terminated by the other PARTY, if permitted by law, by giving written notice of
such termination on a date specified therein.
6. RIGHTS UPON TERMINATION OTHER THAN UNDER SECTION 6.1
6.1 TERMINATION OF LICENSES
Notwithstanding the foregoing, the licenses granted under ARTICLE 3 to the PARTY
committing the material breach under Section 5.2, may be canceled immediately by
the PARTY terminating the AGREEMENT and such breaching PARTY shall promptly
forward to the other PARTY all copies of CONFIDENTIAL INFORMATION, blue prints,
drawings and data which it may have in written or graphic or machine readable
form and which have been proposed or reproduced by it from the CONFIDENTIAL
INFORMATION received from the other PARTY. The termination of this AGREEMENT
pursuant to Section 5.2 shall not affect the rights and licenses previously
granted to the non-breaching PARTY, which shall continue in full force and
effect.
6.2 OBLIGATIONS SURVIVING TERMINATION
Upon termination pursuant to Sections 5.2 or 5.3, the obligations of each PARTY
to the other shall cease except, subject to Section 6.1, the obligations set
forth in ARTICLES 3,4 and 10 shall continue in full force and effect until
completely discharged.
7. FORCE MAJEURE
7.1 ACTS CONSTITUTING FORCE MAJEURE
Neither PARTY shall be liable to the other arising out of a delay in its
performance of this Agreement arising from causes beyond its reasonable control.
Without limiting the generality of the foregoing, such events include any act of
God; accident; explosion; fire; earthquake; flood; strikes; labor disputes;
riots; sabotage; embargo; equipment failure; federal, state, or local legal
restriction or limitation; failure or delay of transportation; shortage of, or
inability to obtain, raw materials, supplies, equipment, fuel, electricity, or
labor. Neither PARTY shall be required to resolve labor disputes or disputes
with suppliers of raw material, supplies, equipment, fuel, or electricity, but
shall use commercially reasonable efforts to seek alternative sources to the
extent practicable.
7.2 NOTICE REQUIREMENT
When circumstances occur which delay the performance of either PARTY under this
Agreement, whether or not such circumstances are excused pursuant to Section 7.1
above, said PARTY shall, when it first becomes aware of such circumstances,
promptly notify (or, if the circumstances occur on a holiday or weekend, on the
first succeeding business day) the other PARTY, by facsimile or by telephone
confirmed in writing within two (2) business days in the case of oral notice.
Within ten (10) business days of the date when either PARTY first becomes aware
of the event which it contends is responsible for the delay, it shall supply to
the other PARTY in writing the reason(s) for and anticipated duration of such
delay, the measures taken and to be taken to prevent or minimize the delay, and
the timetable for the implementation of such measures.
8. GUARANTEES, LIABILITIES AND INDEMNITIES
8.1 LAWFUL POSSESSION
Each PARTY represents that to the best of its knowledge and belief, it will be
in the lawful possession of any CONFIDENTIAL INFORMATION when disclosed by it
pursuant to the AGREEMENT and that the disclosure of said CONFIDENTIAL
INFORMATION shall not in any way violate any agreement to hold such CONFIDENTIAL
INFORMATION in confidence.
8.2 DISCLAIMER
Neither PARTY shall be liable to the other for indirect, special or
consequential damages arising out of any use of CONFIDENTIAL INFORMATION or
INTELLECTUAL PROPERTY rights obtained by it from the other PARTY hereunder.
9. NOTICES
Notices or requests to be given or made hereunder shall be delivered in person
or sent by registered mail or telefax or telex acknowledged by the operator of
the addressee at the following addresses or other addresses that each PARTY may
from time to time designate
(a) for PRIMEX:
PRIMEX TECHNOLOGIES, INC.
10101 Ninth Street North
St. Petersburg, Florida 33716-3807
ATTENTION: General Counsel
Tel: (813)578-1116
Fax: (813)578-8795
(b) for OLIN:
OLIN CORPORATION
501 Merritt Seven
Norwalk, Connecticut 06856-4500
Attention: Corporate Secretary
Tel: (203) 356-3126
Fax: (203) 356-2011
10. EXPORTATION CONTROL
Each PARTY agrees not to export or reexport, or cause to be exported, any
CONFIDENTIAL INFORMATION furnished hereunder by the other PARTY or the equipment
constructed on the basis of such CONFIDENTIAL INFORMATION, or the products
manufactured with such CONFIDENTIAL INFORMATION to any country to which, under
the laws of the country of origin of the CONFIDENTIAL INFORMATION, it is or may
be prohibited from exporting such CONFIDENTIAL INFORMATION or the direct product
thereof.
11. ASSIGNMENT
11.1 LIMITATIONS ON ASSIGNMENT
The AGREEMENT shall not be assigned by either PARTY to a third party without the
prior written consent of the other PARTY, except to: an AFFILIATE of a PARTY, or
a successor in the business to which the AGREEMENT relates, or a successor in
all or substantially all of the assets of either PARTY, provided that the
successor agrees in writing to accept the rights and to be bound by the
obligations of the assigning PARTY, any other assignment being void. The
PARTIES agree to guarantee the performance of their AFFILIATEs under this
AGREEMENT.
11.2 CHANGE OF CONTROL
For purposes of Section 11.1. the following shall be deemed an assignment
by a PARTY of this AGREEMENT:
11.2.1: a PERSON (or two or more PERSONS acting as a "person" within
the meaning of Section 13(d)(3) of the Securities Exchange Act of 1934,
as amended (the "1934 Act"), other than such PARTY, or an employee
benefit plan (or related trust) of such PARTY, becomes the "beneficial
owner" (as defined in Rule 13d-3 under the 1934 Act) of 15% or more of
the then outstanding voting stock of such PARTY, or during any period of
two consecutive years, individuals who at the beginning of such period
constitute the Board of Directors of such PARTY (together with any new
director whose election by the Board or whose nomination for election by
such PARTY's shareholders was approved by a vote of at least two-thirds
of the directors then still in office who either were directors at the
beginning of such period or whose election or nomination for election
was previously so approved) cease for any reason to constitute a
majority of the new directors then in office, and/or
11.2.2: any consolidation or merger of such PARTY in which such
PARTY is not the continuing or surviving corporation or pursuant to
which shares of such PARTY's common stock would be converted into
cash, securities or other property other than a merger in which
holders of such PARTY's common stock immediately prior to the merger
will have the same proportionate ownership of common stock of the
surviving corporation immediately after the merger, and/or
11.2.3: any sale, lease, exchange or other transfer (in one
transaction or a series of related transactions) of all or
substantially all the assets of such PARTY, and/or
11.2.4: adoption of any plan or proposal for the liquidation or
dissolution of such PARTY.
11.3 VIOLATION
Any assignment in violation of this ARTICLE 11 shall be considered void.
12. MISCELLANEOUS
12.1 ENTIRE AGREEMENT
The AGREEMENT embodies the entire understanding of the PARTIES. No amendment or
modification of the AGREEMENT shall be valid or binding upon the PARTIES unless
it is in writing and signed by the respective duly authorized officers of the
PARTIES.
12.2 PARTIES ARE INDEPENDENT
The AGREEMENT does not and shall not be deemed to make either PARTY the agent,
legal representative or partner of the other PARTY for any purpose whatsoever,
and neither PARTY shall have the right or authority to assume or create any
obligation or responsibility whatsoever, expressed or implied, on behalf of or
in the name of the other PARTY or to bind the other PARTY in any respect
whatsoever.
12.3 WAIVER
The failure of either PARTY at any time to require performance by the other
PARTY of any provision hereof shall in no way affect the full right to require
such performance within a reasonable time or thereafter the performance of that
and all other provisions, nor shall the waiver of any succeeding breach of such
provision or any other provision operate as a waiver of the provision itself.
12.4 SEVERABILITY
The invalidity or unenforceability of any one or more of the provisions of the
AGREEMENT shall not affect the validity or enforceability of the remaining
provisions.
12.5 GOVERNING LAW
This Agreement shall be construed and governed, in all respects, by the
law of the State of Illinois applicable to contracts made and to be performed
in that state without reference to any provisions relating to conflicts of
law.
12.6 JURISDICTION
Each PARTY hereby irrevocably and unconditionally submits, for itself and its
property, to the nonexclusive jurisdiction of any Illinois State court or
Federal court of the United States of America sitting anywhere within a radius
of 50 miles from East Alton, Illinois, and any appellate court from any thereof,
in any action or proceeding arising out of or relating to this Agreement, or for
recognition or enforcement of any judgment, and each of the PARTIES hereby
irrevocably and unconditionally agrees that all claims in respect of any such
action or proceeding may be heard and determined in such Illinois State or, to
the extent permitted by law, in such Federal court. Each of the PARTIES hereto
agrees that a final judgment in any such action or proceeding shall be
conclusive and may be enforced in other jurisdictions by suit on the judgment or
in any other manner provided by law.
12.7 VENUE
Each PARTY hereby irrevocably and unconditionally waives, to the fullest extent
it may legally and effectively do so, any objection that it may now or hereafter
have to the laying of venue of any suit, action or proceeding arising out of or
relating to this Agreement in any Illinois State court or such Federal court
located in the State of Illinois. Each of the PARTIES hereto hereby irrevocably
waives, to the fullest extent permitted by law, the defense of an inconvenient
forum to the maintenance of such action or proceeding in any such court.
12.8 SERVICE OF PROCESS
Each Party to this Agreement irrevocably consents to service of process in the
manner provided for notices in ARTICLE 9 hereof. Nothing in this Agreement will
affect the right of any party to this Agreement to serve process in any other
manner permitted by law.
13. SETTLEMENT OF DISPUTES
In the event of any disputes arising out of or in connection with the execution,
interpretation, performance or nonperformance of this AGREEMENT, except for
disputes relating to infringement, validity or enforceability of INTELLECTUAL
PROPERTY, PRIMEX and OLIN shall use the following procedure prior to either
PARTY pursuing other available legal remedies:
13.1 ALTERNATIVE DISPUTE RESOLUTION
Upon signing of this Agreement each PARTY will designate one representative
("Representative") for the purpose of resolving disputes which may arise from
time to time. Upon a dispute arising, either or both Representatives may
request in writing a conference with the other. If so requested, the conference
shall occur within ten (10) days of the initial written request and shall be
held via telephone or at East Alton, Illinois, or elsewhere, at the option of
the Representatives. The purpose and scope of the conference shall be limited
to issues related to resolving the dispute. At the conference, each
Representative, or his or her designee, shall use best efforts to attempt to
resolve the dispute. If the dispute has not been settled within thirty (30)
days of the first meeting of the Representatives, the parties shall establish a
Management Appeal Board ("MAB") within ten (10) days of receipt of a request by
either PARTY to set up an MAB. The MAB shall consist of two (2) members of
each respective PARTY's management. The President of OLIN shall appoint two
members to represent OLIN and the President of PRIMEX shall appoint two members
to represent PRIMEX. The sole purpose of MAB shall be to resolve any dispute
over which the Representatives failed to resolve. The MAB members shall be
persons other than the Representatives. The MAB shall meet at East Alton,
Illinois or otherwise confer to resolve the dispute by good faith negotiations,
which may include presentations by the Representatives or others.
13.2 ARBITRATION
In the event the parties are unable to resolve their disputes after availing
themselves of the processes set forth in Section 13.1 above for a period of
ninety (90) days, such disputes, shall be solely and finally settled by three
arbitrators in accordance with the Commercial Arbitration Rules of the AAA (the
"Arbitration Rules"). The PARTY electing arbitration shall so notify the other
PARTY in writing in accordance with the Arbitration Rules, and such notice shall
be accompanied by the name of the arbitrator selected by the PARTY serving the
notice. The second arbitrator shall be chosen by the other PARTY, and a neutral
arbitrator shall be chosen by the two arbitrators so selected. If a PARTY fails
to select an arbitrator or to advise the other PARTY of its selection within
thirty (30) days after receipt by such a PARTY of the notice of the intent to
arbitrate, the second arbitrator shall be selected by the AAA. If the third
arbitrator shall not have been selected within thirty (30) days after the
selection of the second arbitrator, the appointment shall be made by the AAA.
All such proceedings shall be conducted in New York, New York. The arbitrator
shall make detailed findings of fact and law in writing in support of the
decision of the arbitrator panel, and is empowered to award reimbursement of
attorneys' fees and other costs of arbitration to the prevailing PARTY, in such
manner as the arbitrator panel shall deem appropriate. The provisions of this
Section 13.2 shall not be deemed to preclude any PARTY hereto from seeking
preliminary injunctive relief to protect or enforce its rights hereunder, or to
prohibit any court from making preliminary findings of fact in connection with
granting or denying such preliminary injunctive relief, or to preclude any PARTY
hereto from seeking permanent injunctive or other equitable relief after and in
accordance with the decision of the arbitrator panel. Whether any claim or
controversy is arbitrable or litigable shall be determined solely by the
arbitrator panel pursuant to the provisions of this Section 13.2. Any monetary
award of the arbitrators panel shall include interest from the date of any
breach or any violation of this Agreement. The arbitrators shall fix an
appropriate rate of interest from the date of the breach or other violation to
the date when the award is paid in full. The parties agree that judgment on the
arbitration award may be entered in any court having jurisdiction over the
parties or their assets.
13.3 CONTINUING OBLIGATIONS
It is expressly agreed that the failure of the parties to resolve a dispute on
any issue to be resolved hereunder shall not relieve either PARTY from any
obligation set forth in this Agreement. In addition, notwithstanding the
pendency of any such dispute, neither PARTY will be excused of its obligations
hereunder to cooperate with the other to effectuate the purposes of this
Agreement.
13.4 COUNTERPARTS
This Agreement may be executed in any number of counterparts, each of
which shall be deemed an original, but all of this shall constitute one and
the same instrument
IN WITNESS WHEREOF the PARTIES hereto have caused this AGREEMENT to be executed
in duplicate as of the date first written above.
OLIN CORPORATION PRIMEX TECHNOLOGIES, INC.
By: /S/Johnnie M. Jackson, Jr. By: /S/George H. Pain
-------------------------- -----------------
Name: Johnnie M. Jackson, Jr. Name: George H. Pain
Title: Vice President, General Title: Vice President
Exhibit 10.3
TAX SHARING AGREEMENT
BY AND BETWEEN
OLIN CORPORATION AND PRIMEX TECHNOLOGIES, INC.
This Tax Sharing Agreement (the "Agreement") dated as of December 31, 1996,
between Olin Corporation, a Virginia Corporation ("Olin") and Primex
Technologies, Inc., a Virginia Corporation ("Primex"), is entered into in
connection with a Distribution Agreement (the "Distribution Agreement") dated
December 30, 1996, by and between Olin and Primex.
WHEREAS, until the end of the date (the "Effective Time") on which Olin
will be deemed to distribute to its stockholders all the issued and outstanding
common stock of Primex (the "Distribution"), Primex and its direct and indirect
subsidiaries and Olin will be members for Federal income tax purposes of an
Affiliated Group of corporations for which Olin, the common parent corporation,
will file a consolidated Federal income tax return.
WHEREAS, on the beginning of the first day after the Effective Time, the
Primex Affiliated Group will cease to be members of the Olin Affiliated Group;
WHEREAS, the Distribution is intended to be a tax-free spin-off within the
meaning of Section 355 of the Code;
WHEREAS, Olin and Primex are entering into this Agreement to provide for
the allocation between Olin and Primex of all responsibilities, liabilities and
benefits relating to all foreign, federal, state and local taxes paid or payable
by either Olin or Primex for all taxable periods, whether beginning before, on,
or after the Effective Time and to provide for certain other matters.
NOW, THEREFORE, in consideration of the mutual covenants contained herein,
the parties agree as follows.
ARTICLE I
DEFINITIONS
This Agreement is the "Tax Sharing Agreement" referred to in Section 1.01
of the Distribution Agreement. As used in this Agreement, terms defined in the
Distribution Agreement but not defined herein shall have the meanings set forth
in the Distribution Agreement, and the following terms shall have the following
meanings (such meanings to be equally applicable to both the singular and the
plural forms of the terms defined):
"AFFILIATED GROUP" means an affiliated group of corporations within the
meaning of Section 1504(a) of the Code for the taxable period in question.
"CODE" means the Internal Revenue Code of 1986, as amended, or any
successor thereto, as in effect for the taxable period in question.
"DISTRIBUTION AGREEMENT" means the agreement dated as of the 30th day of
December, 1996 by and between Olin and Primex providing for the Distribution.
For purposes of this Agreement, the Distribution shall be effective as of the
Effective Time.
"INDEMNITEE" is defined in Section 4.01 (a) herein.
"INDEMNITOR" is defined in Section 4.01 (a) herein.
"INDEMNITY ISSUE" is defined in Section 4.01 (a) herein.
"IRS" means the United States Internal Revenue Service or any successor
thereto, including, but not limited to its agents, representatives, and
attorneys.
"OLIN AFFILIATED GROUP" means, for each taxable period, the Affiliated
Group of which Olin or any successor of Olin is the common parent.
"PERSONAL AND REAL PROPERTY TAXES" is defined in Section 3.01 (c) herein.
"POST-DISTRIBUTION PERIOD" means any period beginning after the Effective
Time.
"PRE-DISTRIBUTION PERIOD" means any period ending on or before the
Effective Time.
"PRIMEX AFFILIATED GROUP" means, for each taxable period, the Affiliated
Group of which Primex or any successor of Primex is the common parent.
"STRADDLE PERIOD" is defined in Section 3.01(b)(iv).
"TAXES" means all forms of taxation, whenever created or imposed, and
whenever imposed by a local, municipal, federal, state, foreign or other body (a
"Taxing Authority"), and without limiting the generality of the foregoing, shall
include net income, alternative minimum tax, gross income, sales, use, ad
valorem, gross receipts, value added, franchise, license, transfer, withholding,
payroll, employment, excise, severance, stamp, property, custom duty or other
tax, or governmental charge of any kind whatsoever, together with any related
interest, penalties or other additions to tax, or additional amount imposed by
such Taxing Authority.
"TAXING AUTHORITY" is defined under the term "Taxes".
"TAX RETURN" means any return, filing, questionnaire, information statement
or other document required to be filed, including amended returns that may be
filed, for any period with any Taxing Authority, whether foreign or domestic
(including Federal, state and local), in connection with any Tax (whether or not
a payment is required to be made with respect to such filing).
ARTICLE II
FILING OF TAX RETURNS AND PROVISION OF TAX INFORMATION
Section 2.01. MANNER OF FILING. All Tax Returns filed by Olin and by
Primex after the Effective Time shall be prepared on a basis that is consistent
with a tax-free spin-off within the meaning of Section 355 of the Code, and
shall be filed on a timely basis by the party responsible for such filing under
this Agreement.
Section 2.02. PRE-DISTRIBUTION TAX RETURNS. All Tax Returns required to
be filed for periods ending on or before the Effective Time shall be filed by
Olin.
Section 2.03. POST-DISTRIBUTION TAX RETURNS. All Tax Returns of the
Primex Affiliated Group or any member thereof for periods beginning after the
Effective Time shall be filed by Primex and all Tax Returns of the Olin
Affiliated Group or any member thereof for periods beginning after the Effective
Time shall be filed by Olin.
Section 2.04. TAX BASES OF ASSETS TRANSFERRED. Within ninety (90) days
following the Effective Time, Olin shall notify Primex of the tax attributes
associated with the companies, and the tax bases of the assets and liabilities
transferred to Primex in connection with the Distribution. Within sixty (60)
days after filing the consolidated Federal income tax return for the Olin
Affiliated Group for 1996, Olin shall notify Primex of any adjustments to the
tax attributes and the bases of such assets and liabilities and shall provide
Primex with supporting documentation which details the calculation of such
adjustments.
ARTICLE III
PAYMENT OF TAXES
Section 3.01. ALLOCATION OF TAX LIABILITIES. (a) Consolidated Federal
Income Tax - (i) Olin shall indemnify and hold harmless Primex and all members
of the Primex Affiliated Group from any Federal income tax liability imposed on
the Olin Affiliated Group for any period ending on or prior to the Effective
Time.
(ii) Primex shall indemnify and hold harmless Olin and all members of the
Olin Affiliated Group from and against any Federal income tax liability imposed
on the Primex Affiliated Group with respect to any period ending after the
Effective Time.
(b) State, Local and Foreign Income and Franchise Taxes (i) Olin shall
indemnify and hold harmless Primex and all members of the Primex Affiliated
Group from any state, local and foreign income and franchise Tax imposed on
Olin, the Olin Affiliated Group or any member of the Olin Affiliated Group for
any period ending on or prior to the Effective Time.
(ii) Primex shall indemnify and hold harmless Olin and all members of the
Olin Affiliated Group from any state, local and foreign income and franchise Tax
imposed on Primex, the Primex Affiliated Group or any member of the Primex
Affiliated Group for any period beginning after the Effective Time.
(iii) To the extent permitted by any applicable state, local or foreign
law, Olin, the Olin Affiliated Group and all members of the Olin Affiliated
Group shall treat the Effective Time as the last day of the taxable period. Olin
shall file all state, local and foreign income and franchise Tax Returns for
such period and pay all applicable Tax liabilities.
(iv) (a) To the extent any state, local or foreign law requires Primex,
the Primex Affiliated Group or any member of the Primex Affiliated Group to file
state, local or foreign income or franchise Tax Returns for a tax period
beginning before and ending after the Effective Time ("Straddle Period"), Primex
shall be responsible for any such filings. Primex shall timely file and pay all
income or franchise Tax applicable to returns filed under this Section 3.01 (b)
(iv) (a). Tax paid by Primex attributable to the period ending on the Effective
Time shall be the responsibility of Olin and shall be computed by applying to
the Tax paid a ratio (not to exceed 100%) of taxable income computed as though
the taxable year ended on the Effective Time to total taxable income reflected
on the Tax Return. In the event there is a loss for the pre-distribution period,
such ratio shall be zero. In the event the Tax liability on the Tax Return for
the Straddle Period is computed on a basis other than taxable income, (e.g.
franchise tax liability), pre-distribution Taxes shall be determined as if the
taxable year of Primex ended on the Effective Time. Any amount owed by Olin to
Primex pursuant to this Section 3.01 (b) (iv) shall be decreased by estimated
taxes paid by Olin. If the estimated taxes paid by Olin with respect to the
Straddle Period Tax Return exceed the Tax owed by Olin to Primex under this
paragraph, such excess shall be paid by Primex to Olin.
(b) Primex shall provide Olin for review, comment and approval copies of
such Straddle Period Tax Returns, together with a calculation of pre-
distribution taxes payable by Olin to Primex, or by Primex to Olin, within 20
working days of the due date of such Tax Return. Upon review and acceptance of
the Tax Return and pre-distribution tax calculation, Olin shall pay the amount
of such Tax due to Primex by the later of the due date of the return or ten (10)
days after receipt of the copies of such returns and Tax calculations from
Primex for review, comment and approval. Primex shall pay Olin any amount due by
the due date of the Straddle Period Tax Return. The party not preparing the Tax
Return shall have a right to object to such Tax Return (or calculation of pre-
distribution tax) on the grounds that it is inaccurate. In the event of a
dispute, the parties shall use their best efforts to resolve the dispute as
expeditiously as possible. If the dispute is not resolved prior to the filing of
the Tax Return, the parties agree to file an amended return, if necessary, upon
resolution of the dispute in accordance with Section 6.02 of Article VI.
(c) PERSONAL AND REAL PROPERTY TAXES. (i) The liability for all Taxes
for any tax period that includes the Effective Time which are assessed upon the
value of real or personal property owned, leased, rented or used by the Olin
Affiliated Group, including, but not limited to, real and personal property
taxes, use taxes, value added taxes or other ad valorem taxes ("Personal and
Real Property Taxes), shall be apportioned between and among Olin and Primex as
follows:
(1) the Personal and Real Property Taxes allocable to that portion of the
Tax period ending on the Effective Time shall be the liability of Olin; and
(2) the Personal and Real Property Taxes allocable to that portion of the
tax period which begins after the Effective Time shall be the liability of
Primex, but only to the extent such taxes are attributable to the assets of the
Primex Businesses; otherwise, such taxes shall be the liability of Olin.
(ii) The party receiving the bill from the Taxing Authority shall timely
pay the liability, and request payment from the other party of the apportioned
amount under this Section 3.01(c), and shall cause the records of the Tax
Authority assessing such Taxes to properly reflect the change in ownership
affecting the assessed property.
(iii) Primex shall pay, on a timely basis, all Personal and Real Property
Taxes of the Primex Affiliated Group for all tax periods beginning after the
Effective Time.
(d) REFUNDS. Each party shall be entitled to retain or be paid all
refunds of tax received, whether in the form of payment, credit or otherwise,
from any Taxing Authority with respect to any Tax Return filed or to be filed by
such party in accordance with Sections 2.02 and 2.03 hereof.
Section 3.02. SECTION 355 TAX. If there is a determination (within the
meaning of Section 1313 of the Code) that the Distribution fails to qualify as a
tax-free spin-off under Section 355 of the Code, Primex shall be responsible for
20 percent, and Olin shall be responsible for 80 percent, of Taxes (including
any interest or penalties with respect thereto) imposed on Olin as a result of
such determination unless such failure shall arise as a result of an action,
other than any action taken consistent with the opinion of counsel obtained by
Olin in connection with the distribution contemplated by the Distribution
Agreement, taken after the Effective Time by Olin (or any member of the Olin
Affiliated Group) or by Primex (or any member of the Primex Affiliated Group),
in which case Olin or Primex, as the case may be, shall be responsible for the
full amount of such Taxes regardless of whether an opinion of counsel that such
action would not cause such failure to qualify was obtained. Primex's obligation
under this Section 3.02 shall be effected by its payment of the appropriate
amounts to Olin no later than the due date for payment of such Taxes to the
relevant Taxing Authority.
Section 3.03 - TIME AND FORM OF PAYMENT. (a) Payments under this
Agreement shall be due on the date provided for in this Agreement without any
additional notification by the party to whom such payments are due. If a due
date is not provided in this Agreement, payments under this Agreement shall be
made no later than thirty (30) days after the date written demand therefor (with
a reasonably detailed explanation for the basis of the claim) is received by the
party obligated to make such payment
(b) If either Primex or Olin shall default on its payment obligations
under this Agreement (including as a result of a voluntary bankruptcy), upon 90
days' notice (except that in the case of bankruptcy no such notice shall be
required) the party not in default shall have the right to offset its payment
obligations under this Agreement against the defaulting party's payment
obligations to it. The failure or refusal to pay an amount when due under this
Agreement shall not constitute a default if the amount of, or liability for,
such payment is being disputed pursuant to Section 6.02 of Article VI.
(c) Any portion of a payment not in dispute shall be paid notwithstanding
the dispute with respect to the remaining portion of such payment. Acceptance of
such partial payment (or any other partial payment) will not constitute a waiver
of the right to dispute resolution under Section 6.02 of Article VI.
Section 3.04. INTEREST ON UNPAID AMOUNTS. In the event that any party
fails to pay any amount owed pursuant to this Agreement within ten (10) days
after the date when due, interest shall accrue at the rate applicable to
underpayments of the tax as provided for in the Code from the due date until
such amounts are fully paid (regardless of the existence of any dispute with
respect to the amount of, or liability for, such payment).
Section 3.05. TREATMENT OF PAYMENTS. The parties agree that for all tax
and financial accounting purposes any payments made pursuant to this Agreement
to one party by another party shall be treated as nontaxable adjustments to the
capital contribution of cash made by Olin to Primex in connection with the
Distribution (including treating such payments as distributions from Primex to
Olin immediately prior to the Distribution), unless otherwise required by law.
ARTICLE IV
INDEMNITY: COOPERATION AND EXCHANGE OF INFORMATION
Section 4.01 INDEMNITY. (a) Whenever a party hereto (an "Indemnitee")
becomes aware of the existence of an issue which relates to any Tax or liability
of the other party or any member of its Affiliated Group that may arise under
this Agreement (an "Indemnity Issue"), the Indemnitee shall promptly notify the
other party (the "Indemnitor") of the Indemnity Issue.
(b) Olin and Primex will indemnify each other for any liabilities
resulting from any breach of their respective representation made to Cravath,
Swaine & Moore in connection with its opinion. Neither Olin nor Primex will
indemnify any holder of Olin Common Stock who receives shares in the
Distribution for any Tax liabilities.
(c) Olin shall have full responsibility and discretion in handling,
settling or contesting any Tax controversy, involving a Tax Return for which it
has filing responsibility pursuant to Sections 2.02 and 2.03 hereof. Primex
shall have full responsibility and discretion in handling, settling or
contesting any Tax controversy involving a Tax Return for which it has filing
responsibility pursuant to Section 2.03 hereof. Any costs incurred in handling,
settling or contesting any Tax controversy shall be borne by the party having
full responsibility and discretion thereof.
(d) In the event that a notice of deficiency is received by Olin from the
IRS or any Taxing Authority and such notice relates in whole or in part to a Tax
for which Primex could be liable to Olin pursuant to Section 3.02 hereof then:
(i) Olin shall notify Primex of the notice of deficiency and the potential
Primex Tax exposure. Olin shall determine in its sole discretion the nature of
all action, if any, to be taken to contest such notice of deficiency including
(a) whether any action to contest such notice of deficiency shall initially be
by way of judicial or administrative proceedings, or both, (b) whether any such
proposed adjustment shall be contested by resisting payment thereof or by paying
the same and seeking a refund thereof, and (c) if Olin shall undertake judicial
action with respect to such notice of deficiency, the court or other judicial
body before which such action shall be commenced.
(ii) Olin shall provide Primex copies of written correspondence from the
IRS or any Taxing Authority regarding any notice of deficiency which relates to
such Tax and shall keep Primex informed of the progress of the contest as it
relates to Primex's Tax exposure. Olin shall determine, if Primex and its
representatives, at Primex expense, shall be entitled to participate in (1) all
conferences, meetings, or proceedings with any Taxing Authority, the subject
matter of which is or includes such Tax and (2) all appearances before any
court, the subject matter of which includes such Tax. The right to participate
referred to in this Section 4.01 (c) (ii) shall include the submission and
content of documentation, protest, memoranda of fact and law and briefs and the
selection of witnesses.
Section 4.02. COOPERATION AND EXCHANGE OF INFORMATION. (a) Primex and
Olin shall each cooperate (and shall cause each member of the Olin Affiliated
Group and the Primex Affiliated Group to cooperate) fully at such time and to
the extent reasonably requested by the other party in connection with the
preparation and filing of any Tax Return or claim for refund, or the conduct of
any audit, dispute, proceeding, suit or action concerning any issues or other
matters considered in this Agreement. Such cooperation shall include, without
limitation, the following: (i) forwarding promptly copies of appropriate notices
and forms or other communications received from any Taxing Authority (including
any IRS revenue agent's report or similar report, notice of proposed adjustment,
or notice of deficiency) or sent to any Taxing Authority or any other
administrative, judicial or other governmental authority that relate to an
Indemnity Issue, (ii) the retention and provision on demand of Tax Returns,
books, records (including those concerning ownership and tax basis of property
which either party may possess), documentation or other information relating to
the Tax Returns, including accompanying schedules, related workpapers, and
documents relating to rulings or other determinations by Taxing Authorities,
until the expiration of the applicable statute of limitations (giving effect to
any extension, waiver or mitigation thereof) subject to the provisions of
Section 4.02 (e) hereof; (iii) the provision of additional information and an
explanation of material provided under clause (i) of Section 4.02 (a), provided
such information or explanation is necessary or reasonably helpful with the
foregoing; (iv) the execution of any document that may be necessary or
reasonably helpful in connection with the filing of a Tax Return by Olin or
Primex or any member of their respective Affiliated Groups, or in connection
with any audit, dispute proceeding, suit or action; and (v) the use of the
parties' best efforts to obtain any documentation from a governmental authority
or a third party that may be necessary or reasonably helpful in connection with
any of the foregoing.
(b) Both parties and the members of their respective Affiliated Groups
shall use reasonable efforts to keep each other advised as to the status of Tax
audits or litigation involving an Indemnity Issue and cooperate in a defense
with respect to a Indemnity Issue in any Tax controversy.
(c) Each party shall make its employees and facilities available on a
reasonable and mutually convenient basis in connection with any of the foregoing
matters.
(d) If either party fails to provide any information requested pursuant
to Section 4.02 hereof within a reasonable period, as determined in good faith
by the party requesting the information, then the requesting party shall have
the right to engage a public accounting firm to gather such information,
provided that thirty (30) days prior written notice is given to the unresponsive
party. If the unresponsive party fails to provide the requested information
within thirty (30) days of receipt of such notice, then such unresponsive party
shall permit the requesting party's public accounting firm full access to all
appropriate records or other information as reasonably necessary, and shall
reimburse the requesting party or pay directly all cost connected with the
requesting party's engagement of the public accounting firm.
(e) Upon the expiration of any statute of limitations, the documentation
of Olin or Primex or any member of their respective Affiliated Groups, including
without limitation, books, records, Tax Returns and all supporting schedules and
information relating thereto, shall not be destroyed or disposed of unless (i)
the party proposing such destruction or disposal provides sixty (60) days prior
written notice to the other party describing in reasonable detail the
documentation to be destroyed or disposed of, and (ii) the recipient of such
notice agrees in writing to such destruction or disposal. If the recipient of
such notice objects, then the party proposing the destruction or disposal shall
promptly deliver such materials to the objecting party at the expense of the
objecting party.
Section 4.03. If either Olin or Primex, or a member of their respective
Affiliated Groups, supplies information to another party upon such party's
request, and an officer of the requesting party intends to sign a statement or
other document under penalties of perjury in reliance upon the accuracy of such
information, then at the request of the party that received the information, a
duly authorized officer of the party supplying such information shall certify,
to the best of such party's knowledge, the accuracy and completeness of the
information so supplied.
Section 4.04. INDEMNIFICATION FOR TAX ATTRIBUTES. Nothing in this
Agreement shall be construed as a guarantee of the existence or amount of any
loss, credit, carryforward, basis or other tax attribute, whether past, present
or future, of Olin or Primex and any member of their respective Affiliated
Groups, or an indemnity against the reduction or elimination of any such
attribute by any Taxing Authority.
ARTICLE V
WARRANTIES AND REPRESENTATIONS
Section 5.01. WARRANTIES AND REPRESENTATIONS RELATING TO ACTIONS OF OLIN
AND PRIMEX. As an inducement to enter into this Agreement, Olin and any member
of the Olin Affiliated Group and Primex and any member of the Primex Affiliated
Group warrant and represent to the other party that they shall comply with and
not take any action that is inconsistent with the representations and statements
made to Cravath, Swaine & Moore in connection with such firm's rendering an
opinion to Olin and Primex as to certain tax aspects of the Distribution.
Section 5.02. WARRANTIES AND REPRESENTATIONS RELATING TO ACTIONS OF PRIMEX.
Primex, its successors, and each member of the Primex Affiliated Group, hereby
warrants and represents to Olin that it has no present plan or intention,
(i) to liquidate or merge into any corporation; and
(ii) to sell, exchange, distribute or otherwise dispose of Primex assets
or assets of any member of the Primex Affiliated Group other than in the
ordinary course of business.
ARTICLE VI
MISCELLANEOUS PROVISIONS
Section 6.01. NOTICE. Any payment, notice or communication required or
permitted to be given under this Agreement shall be in writing (including
facsimile) and mailed, faxed or delivered to the parties at the following
addresses (or at such other address as one party may specify by notice to the
other party):
If to Olin to:
Olin Corporation
501 Merritt 7
PO Box 4500
Norwalk, Ct. 06856-4500
Attention: Vice President Taxes and Risk Management
If to Primex:
Primex Technologies, Inc.
10101 Ninth Street North
St. Petersburg, Florida 33716-3807
Attention: Chief Financial Officer
Notification of a change of address shall be given by either party to the other
as provided in Section 6.01 hereof. All such notices and communications shall be
effective (i) when received, if mailed or delivered, or (ii) when faxed
confirmed by fax answerback.
Section 6.02. RESOLUTION OF DISPUTES. The calculation and determination
of the payment of Tax and the allocation thereof under Section 3.01 (Allocation
of Tax Liabilities) and Section 3.02 (Section 355 Tax), shall be made or
verified by the party required to make such payment (the "Payor"). If the party
to receive such payment (the "Payee") shall have any dispute concerning such
Tax, it may request in writing that the Payor cause a "Big Six" certified public
accounting firm (the "Accounting Firm") to review such Tax to determine and
confirm in writing that such Tax is more likely than not correct (a
"Confirmation"). The Accounting Firm shall be mutually acceptable to Olin and
Primex and may not be the auditor of, or primary tax advisor for, either Olin or
Primex in the year in which such confirmation is to be made or with respect to
the taxable period subject to such confirmation. If a confirmation is issued by
the Accounting Firm, such Tax shall be binding upon the parties. If the
Accounting Firm is unable to issue a Confirmation, the Payor shall amend such
Tax such that the Accounting Firm can issue a Confirmation in respect of the
amended Tax Allocation Obligation. The Payee shall be responsible for the fees
and disbursements of the Accounting Firm, unless the amounts of the payments
excluding interest as recalculated differs from the amount originally calculated
by the Payor excluding interest, if any, by more than 10% of such originally
calculated amount, in which case the Payor shall be responsible for such fees
and disbursements.
The Accounting Firm shall treat all Tax Returns as confidential, and shall
not reveal any information contained in, or any part of, the tax returns of one
party to the other without the consent of the party to whom the Tax Returns
belong.
Section 6.03. GOVERNING LAW. This Agreement shall be governed by the
laws applicable to contracts entered into and to be fully performed within the
State of Connecticut by residents thereof.
Section 6.04 BINDING EFFECT; SUCCESSORS This Agreement shall be binding
upon the parties hereto and shall inure to the benefit of and be binding upon
any of their successors or assigns.
Section 6.05 ENTIRE AGREEMENT; ASSIGNMENT This Agreement embodies the
entire understanding between the parties relating to its subject matter and
supersedes and terminates all prior agreements and understanding among the
parties with respect to such matter. Any and all prior correspondence,
conversations and memoranda with respect to such subject matter are merged
herein and shall effect hereon. No promises, covenants or representations of any
kind, other than those expressly stated herein, have been made to induce any
party to enter into this Agreement. This Agreement shall not be modified or
terminated except by writing duly signed by each of the parties hereto, and no
waiver of any provisions of this Agreement shall be effective unless in a
writing duly signed by the party sought to be bound.
Section 6.06 COUNTERPARTS This Agreement may be executed in two or more
counterparts, each of which shall be deemed to be an original, but all of which
together shall constitute one and the same.
Section 6.07 SEVERABILITY If any provision of this Agreement or the
application of any such provision to any person or circumstances shall be held
invalid, illegal or unenforceable in any respect by a court of competent
jurisdiction, such invalidity, illegality or unenforceability shall not affect
any other provision hereof.
Section 6.08 HEADINGS Headings of sections in this Agreement are
inserted for convenience of reference only and are not intended to be a part of
or to affect the meaning or interpretation of this Agreement.
IN WITNESS WHEREOF, each of the parties has caused this Agreement to be
executed by its respective duly authorized officer as of the date first set
forth above.
Olin Corporation
By: Johnnie M. Jackson, Jr.
-----------------------
Johnnie M. Jackson, Jr.
Title: Vice President, General
Counsel and Secretary
Primex Technologies Inc.
By: George H. Pain
--------------
George H. Pain
Title: Vice President
Exhibit 10.4
POWDER SUPPLY REQUIREMENTS AGREEMENT
THIS AGREEMENT ("Agreement") is made and entered into as of December 31,
1996, by and between PRIMEX TECHNOLOGIES, INC., a corporation duly organized and
existing under the laws of Virginia, and having its principal office at 10101
Ninth Street North, St. Petersburg, Florida 33716-3807 ("Primex") and OLIN
CORPORATION, a corporation duly organized and existing under the laws of
Virginia, and having an office at 427 North Shamrock Street, East Alton,
Illinois 62024 ("Olin"). (Olin and Primex each being referred to as a "Party"
individually and collectively as the "Parties".)
WITNESSETH:
WHEREAS, Olin has transferred to Primex all or substantially all of the
assets related to Olin's Ordnance Division, including its St. Marks, Florida
powder manufacturing plant ("St. Marks Plant") in anticipation of the spin-off
of Primex to the shareholders of Olin; and,
WHEREAS, Olin desires to purchase Product(s), as defined below, from Primex
to support the business and manufacturing activities of its Winchester Division
("Winchester"); and,
WHEREAS, Primex desires to sell Winchester such Products; and,
WHEREAS, the Parties desire to enter into this Agreement for the purchase
and sale of Products.
NOW, THEREFORE, in consideration of the above and the mutual undertakings
set forth below, the Parties intending to be legally bound, covenant and agree
as follows:
1. DEFINITIONS:
For purposes of this Agreement, the following terms shall have the following
meanings:
(a) "CONFIDENTIAL INFORMATION" shall mean any and all information
disclosed to the receiving Party by a disclosing Party pursuant to this
Agreement, in any form such as, but not limited to, visual, oral, written,
graphic, electronic or model form, including but not limited to know-how and
trade secrets, whether of a business or a technical nature, whether patented or
not and whether in the laboratory, pilot plant or commercial plant stage
(including drawings, operating conditions, specifications, safety instructions,
environmental recommendations, emergency instructions, etc.) owned or controlled
by a Party.
(b) "EFFECTIVE TIME" shall mean such date as may hereafter be determined
by Olin's Board of Directors as the date as of which the spin-off of Primex
shall be effected.
(c) "INELIGIBLE OFFERS" shall mean an offer by a third party to sell
powder during a period in which a petition has been filed and is pending
claiming that (i) said third party has received a "subsidy" as that term is
defined in Article 1 of the Agreement on Subsidies and Countervailing Measures
of the General Agreement on Tariffs and Trade 1994, with respect to such powder
and/or (ii) such powder sold by said third party is being "dumped" as that term
is defined in Article 2 of the General Agreement on Tariffs and Trade 1994.
(d) "PRODUCT(S)" shall mean propellant powder manufactured and/or sold by
Primex, including but not limited to St. Marks Powders and Synthesia Powders.
(e) "REQUIREMENTS" shall mean the total amount of propellant powder used
by Winchester in any calendar year in loading ammunition (excluding ammunition
loaded by Winchester as the operator of any government owned, contractor
operated (GOCO) facility including the Lake City Army Ammunition Plant in
Independence, Missouri), excluding all such propellant powder that Winchester
purchases from a third party because:
(i) Primex is unable or unwilling to manufacture propellant powder at
its St. Marks, Florida facility and supply such powder within a commercially
reasonable time after a request therefor by Olin; or
(ii) Primex is unable to produce or supply propellant powder because
of an occurrence of force majeure, as defined in Section 18 below.
For the purposes of this subsection 1(e), Primex may supply St. Marks
Powder that has safety, handling and performance characteristics substantially
equivalent to the powder then offered by a third party to Olin. Primex and Olin
shall expeditiously and in good faith resolve differences in opinion on which
powders are substantially equivalent and, failing resolution, shall employ the
dispute resolution provisions set forth in this Agreement. As a clarification of
subparagraph (i) of subsection 1(e) of this Agreement: (1) only those powders
which are actually requested by Olin to be made by Primex may be excluded from
the Requirements pursuant to this Agreement; (2) specific powders that are
specified by the government to be used to manufacture particular rounds of
ammunition and which Primex cannot make are excluded from the Requirements
pursuant to this Agreement; and (3) powders that are used by any third party in
manufacturing ammunition for sale to Winchester are excluded from the
Requirements pursuant to this Agreement, unless Winchester supplies any
components to such third party for inclusion in such ammunition. Primex shall
advise Olin of its willingness and ability to produce and supply any powder
within fifteen (15) working days of a request by Olin.
(f) "SIMILAR PRODUCT" shall mean any propellant powder, sold by Primex (or
its agent) to any third party commercial customer anywhere in the world, that is
substantially similar or identical to Product offered or sold by Primex to Olin
hereunder. (Exhibit A provides guidelines to establish which powders are
"substantially similar or identical to".)
(g) "ST. MARKS POWDER(S)" shall mean propellant powder manufactured by
Primex at its St. Marks, Florida powder manufacturing plant, excluding Synthesia
Powders.
(h) "SYNTHESIA POWDER" shall mean propellant powder purchased by Primex
from Synthesia a.s., including but not limited to propellant powder distributed
by Primex pursuant to that certain "Distribution Agreement, U.S.A., Canada, And
Mexico" executed by Synthesia a.s. as of "14 III 96" which was assigned by Olin
to Primex.
2. TERM:
This Agreement shall become effective upon the Effective Time and shall continue
to, and including, December 31, 2002 unless it is sooner terminated as provided
herein.
3. PRICING:
PRICE: The prices for Products purchased by Olin from Primex during the
Term of this Agreement shall be established at competitive levels by mutual
written agreement by Olin and Primex from time-to-time.
4. QUANTITY:
(a) PERCENTAGE OF REQUIREMENTS: During the term of this Agreement, Olin
shall purchase from Primex, and Primex shall sell to Olin at least the percent
of Olin's Requirements during each calendar year as set forth below, excluding
therefrom propellant powder that Olin purchases from a third party because
Primex declines to meet the price and other material terms (including
commercially reasonable delivery dates) offered by a third party (excluding
Ineligible Offers) within five (5) business days after Olin provides Primex with
satisfactory evidence of said offer:
CALENDAR YEAR PERCENT OF REQUIREMENTS
1997 100%
1998 90%
1999 85%
2000 80%
2001 75%
2002 70%
For purposes of Section 4, the price at which Primex is deemed to meet the
price offered by a third party shall take into account any relevant differences
in burning efficiencies between Primex's powder and the powder offered by the
third party.
(b) SYNTHESIA POWDER. No Synthesia Powder requested by Olin to be
supplied by Primex shall count towards satisfying Olin's obligation to purchase
its Requirements from Primex; provided, however, Primex may waive this
restriction upon request by Olin on a case-by-case basis. Notwithstanding any
other provision of this Agreement, Olin shall have no obligation to purchase
Synthesia Powder hereunder.
(c) PREFERRED CUSTOMER. Olin shall be Primex's preferred customer of
Products. However, nothing in this Agreement is intended to require Primex to
sell Products exclusively to Olin, except as may be specifically provided by the
Parties following the date first above written with respect to specific New
Products, as defined below.
(d) SUPPLY SCHEDULES. Olin will prepare supply schedules in accordance
with Exhibit B, attached hereto.
5. PRODUCT SPECIFICATIONS:
Product specifications are identified on Exhibit A, attached hereto and
made a part hereof by this reference. Specifications for New Products, as
defined below, shall be added to Exhibit A from time-to-time by mutual agreement
between the Parties.
6. NEW PRODUCT DEVELOPMENT:
The Parties recognize that from time-to-time powders or powder-related
products may be developed ("New Products"). Primex agrees to make New Products
available to Olin, except to the extent Primex is restricted from doing so by
development agreements entered into with unaffiliated third parties. Prior to
the initiation of a New Product development effort to be assisted by Olin, the
Parties shall agree on each Party's role in the New Product development effort,
including, but not limited to, such items as cost sharing, engineering support,
product test and the introduction and availability of the New Product to Olin on
an exclusive basis, and other customers generally. Pricing for New Products
shall be in accordance with Section 3, above.
7. STORAGE AND INVENTORY:
Primex shall maintain, at all times during the Term of this Agreement, a
sixty (60) calendar day supply ("Safety Stock") of each Product required by
Winchester as identified on the Firm Supply Schedule as defined in Exhibit B.
The sixty (60) calendar day Safety Stock shall consist of a thirty (30) calendar
day inventory of finished Product and the work-in-process to support the Firm
Supply Schedule. The sixty (60) calendar day Safety Stock shall be maintained
by Primex to insure the continued immediate availability of Product to support
Olin's requirements for each Product identified on the Firm Supply Schedule.
Olin shall be obligated to take delivery of all Products comprising the Safety
Stock in accordance with the Firm Supply Schedule, unless Primex relieves Olin,
in writing, of such obligation. During the Term of this Agreement, the Parties
may agree to increase or decrease the Safety Stock requirements. The sixty (60)
calendar day Safety Stock shall be maintained at Primex's sole cost and expense.
Any increases in the Safety Stock requested by Olin, and agreed to by Primex,
shall be at Olin's expense.
8. ACCEPTANCE:
(a) Acceptance shall occur upon delivery of Product. Primex shall provide
Olin with certified test results verifying Product compliance with Product
specifications upon delivery. All Products shall be subject to the warranty
provisions contained herein.
(b) Each delivery shall constitute a separate contract and payment
therefore shall be made without regard to any other shipments.
9. PAYMENT:
Olin shall make full payment to Primex for all shipments within thirty (30)
calendar days after delivery of Product to Olin. If a good faith dispute
concerning a particular shipment of Product arises, Olin shall promptly notify
Primex, in writing, of the dispute and the Parties shall, in good faith, meet to
resolve the dispute. Unless otherwise agreed in the context of resolving a
dispute, all amounts unpaid by Olin after the thirty (30) day period referenced
above shall bear interest at the prime rate beginning on the thirty-first day
(31st) until paid. The prime rate shall be established on such thirty-first
(31st) day by the published prime rate charged by the Chase Manhattan Bank, New
York, New York, or any successor thereto.
10. CHANGES OF PRODUCT AVAILABILITY:
(a) Primex shall promptly notify Olin, in writing, in advance of the
planned discontinuance or change in any Product or Product line that Olin
purchases.
(b) Olin shall promptly notify Primex of its planned discontinuance or
change of any ammunition loaded with the Product, including its intention to
load such ammunition with a new or different propellant powder, provided it does
not breach an obligation of confidentiality with a third party.
(c) Upon receipt of another party's notice of planned Product or
ammunition discontinuance or change, the Parties shall enter into immediate
discussions to mutually agree on a scheduled "phase-out" plan of that particular
Product or ammunition. The "phase-out" plan shall take into consideration the
minimum disruption to Olin's and Primex's business activities, minimum lot sizes
and support of the WINCHESTER[R] brand product lines. In the event the Parties
cannot agree on a Product "phase-out" plan, then Primex shall continue to
manufacture, make available and sell the Product in minimum lot sizes, to Olin
for twenty-four (24) consecutive months after the date of the notice of Product
discontinuance or change.
11. PACKAGING:
(a) All Products will be packed with care by Primex and delivered in an
undamaged condition to the point of delivery.
(b) Primex may package Products in new or used fibre-pak containers
("Fibre-paks"). Olin agrees to return the Fibre-paks to Primex in full
truckload quantities in accordance with the "Conditions for Used Pack Acceptance
at St. Marks" set forth in Exhibit C, attached hereto. Primex shall be
responsible for Olin's reasonable return freight costs. In consideration of
each Fibre-pak returned to Primex in accordance with Exhibit C Primex agrees to
pay Olin the greater of: (1) any amount paid by Primex to any third party at any
time in the then-current calendar year for the respective size of Fibre-pak, or
(2) the following:
(i) Thirty cents ($0.30) for each six and one-half (6.5)
gallon Fibre-pak; and
(ii) one dollar ($1.00) for each fourteen and one-half (14.5)
gallon Fibre-pak.
12. DELIVERY:
Title and risk of loss of all Products sold hereunder shall pass to Olin
upon delivery to Olin f.o.b., St. Marks, Florida, freight prepaid.
13. QUALITY REVIEW:
Olin shall have the right, upon reasonable prior notice to Primex and at
reasonable times, to send its employees, agents and representatives to visit
Primex production facilities and review Primex production and quality-control
techniques, for the sole purpose of assuring Olin of the consistent quality of
the Product(s) supplied hereunder; PROVIDED, HOWEVER, that nothing in this
Section 13 shall entitle any such employee, agent or representative of Olin to
review any confidential or proprietary information of Primex.
14. WARRANTY:
(a) Primex warrants to Olin that: (i) for a period of twelve (12)
consecutive months after delivery, the Products sold hereunder shall conform to
the specifications identified in Exhibit C and be free from defects in material
and workmanship, and (ii) Olin will receive good title to all Products sold
hereunder, free and clear of any security interest, lien or encumbrance. THE
ABOVE WARRANTIES ARE EXCLUSIVE AND IN LIEU OF ANY OTHER WARRANTIES, WHETHER
EXPRESS OR IMPLIED, INCLUDING THE WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A
PARTICULAR PURPOSE.
(b) If Products are defective in material or workmanship or fail to meet
applicable specification(s), then Primex shall accept return of the defective
Products and promptly replace the defective Products with conforming Products at
its own cost, including transportation and delivery costs. Primex's obligations
hereunder are contingent upon the Product not being subject to misuse or abuse
by Olin and Primex's right to reasonable access to Olin's facilities to verify
the non-conforming Product.
(c) Without limiting the obligations identified in Section 15, the Parties
agree that Olin's sole and exclusive remedy and Primex's sole and exclusive
liability for the delivery of defective Product shall be as identified in this
Section 14 and in Section 19 hereof.
15. INDEMNIFICATION:
(a) Primex shall defend, indemnify and hold Olin, its directors, officers,
agents, servants and employees harmless from and against any and all
liabilities, claims, damages, costs, expenses and judgments (including but not
limited to reasonable attorneys' fees and disbursements) which are caused by or
alleged to be caused by manufacturing and/or design defects (including strict
liability) in the Product(s) purchased hereunder.
(b) Olin shall defend, indemnify and hold Primex, its directors, officers,
agents, servants and employees harmless from and against any and all
liabilities, claims, damages, costs, expenses and judgments (including but not
limited to reasonable attorneys' fees and disbursements) which (i) are caused by
Olin's negligent misuse or improper handling of Product(s), or (ii) result from
Olin's manufacturing and/or design defects (including strict liability) in
ammunition loaded with non-defective Product purchased hereunder.
(c) In cases where a third-party lawsuit has been filed alleging, among
other things, that the Products purchased by Olin hereunder or ammunition made
therefrom failed to meet Product specifications or were defective in material or
in some manner contributed to an occurrence giving rise to a claim of personal
injury, death or property damage, the Parties agree to cooperate in the defense
of the lawsuit. All costs, expenses, attorneys' fees, settlements and/or
judgments and other amounts expended in the defense of the lawsuit shall be
allocated between the Parties in an equitable manner as determined by the
Parties on a case-by-case basis.
16. LIMITATION OF LIABILITY:
Except as provided in Section 15 above, in no event shall either Party be
liable for special, consequential or incidental damages under this Agreement.
17. SECRECY:
(a) SECRECY OBLIGATION: Each of the Parties agrees: (i) to keep
confidential the terms of this Agreement, except to the extent required by law;
and (ii) to keep confidential and neither disclose to others nor use except as
permitted herein any Confidential Information received from the other Party
pursuant to the Agreement.
(b) LIMITS ON DISCLOSURE: The receiving Party shall treat such
Confidential Information in the same manner and with the same degree of care as
it uses with respect to its own Confidential Information of like nature and
shall disclose Confidential Information of the other Party only to its employees
who have a need to know it, provided that such employees are bound to respect
all secrecy obligations provided for in this Agreement.
(c) EXCEPTIONS: The obligation set forth in this Section 17(a) above
shall not apply with respect to any Confidential Information which:
(i) PUBLIC KNOWLEDGE: Is generally available to the public or
subsequently becomes generally available to the public through no breach by the
receiving Party of secrecy obligations under this Agreement or prior agreements
between the Parties concerning the Confidential Information; or
(ii) PRIOR POSSESSION: The receiving Party can establish by competent
evidence was in its possession at the time of disclosure and was not acquired in
confidence directly or indirectly, from the disclosing Party; or
(iii) RECEIVED FROM THIRD PARTY: Is received from a third party
who is legally free to disclose such Confidential Information and who did not
receive such Confidential Information in confidence from the disclosing Party;
or
(iv) APPROVED FOR DISCLOSURE: Is approved in writing for release by
the disclosing Party; or
(v) SUCCESSOR IN INTEREST: Is disclosed to any permitted assignee of
the Agreement, provided that such assignee agrees to be bound by the provisions
of the Agreement; or
(vi) INDEPENDENTLY DEVELOPED: Is independently developed by the
receiving Party without reference to the Confidential Information received from
the disclosing Party.
(d) PERMITTED DISCLOSURES: The provisions of Section 17(a)
notwithstanding, in exercising the rights granted under this Agreement, either
Party may disclose Confidential Information to others for purpose of
sublicensing (as permitted hereunder), design, engineering, construction or
operation of facilities permitted hereunder using Confidential Information; or
obtaining or giving consulting services under a license agreement permitted
hereunder, provided that any third party, to which such Confidential Information
is disclosed shall have first entered into a written secrecy and non-use
obligation at least as stringent as that imposed on the Parties pursuant to this
Agreement.
(e) SUBPOENA OR DEMAND: The provisions of Section 17(a) notwithstanding,
a Party may disclose Confidential Information pursuant to a subpoena or demand
for production of documents in connection with any suit or arbitration
proceeding, any administrative procedure or before a governmental or
administrative agency or instrumentality thereof or any legislative hearing or
other similar proceeding, provided that the receiving Party shall promptly
notify the disclosing Party of the subpoena or demand and provided further that
in such instances, the Parties use their reasonable best efforts to maintain the
confidential nature of the Confidential Information by protective order or other
means.
18. FORCE MAJEURE:
(a) Neither Party shall be liable to the other for its failure to perform
any or all of its obligations hereunder if such failure is caused by strikes,
labor troubles, fire, flood, accidents, wars (domestic or foreign), riots, civil
commotions, sabotage, acts of God, explosion, embargo, or due to orders or
directives of any governmental authority having jurisdiction over the Parties,
or for any acts beyond the reasonable control of the affected Party.
(b) In the event Primex experiences an occurrence of force majeure,
impacting its ability to manufacture and/or deliver Products to Olin to meet
Winchester's needs, Primex shall immediately notify Olin, in writing, of the
event and the anticipated date of the resumption of Product manufacturing and/or
delivery activities.
(c) If Primex is delayed in the resumption of Product manufacturing and/or
delivery activities (for any reason OTHER than any official act of the United
States Government asserting procurement priority over all or any part of
Primex's production facility located in St. Marks, Florida) beyond six (6)
months after the initiation of the force majeure event, or if Primex decides for
any reason to exit the business of manufacturing, producing and/or delivering
St. Marks Powder, Primex shall, at its sole option: (i) grant Olin a limited,
royalty-free license to use and sublicense the most current technology and know-
how necessary to manufacture St. Marks Powders for delivery solely to Winchester
and its distributors and dealers, or (ii) grant a third party a limited,
royalty-free license to use the most current technology and know-how necessary
to manufacture St. Marks Powders for delivery solely to Winchester and its
distributors and dealers.
19. TERMINATION:
Either Party shall have the right to terminate this Agreement upon twenty-
five (25) calendar days advance written notice to the other Party in the event
the other Party breaches a material provision of this Agreement and the
breaching Party fails to substantially cure the material breach within a period
of time equal to: (i) said 25-day period, plus (ii) the number of calendar
days, not to exceed 14, of any shut-down of Primex's St. Marks Powder
production facility commencing or ending within said 25-day period. If either
Party elects to exercise its right to assign this Agreement pursuant to Section
26 (c) hereto in connection with its merger or consolidation or the sale of all
or substantially all its assets related to, in the case of Olin, its business of
manufacturing and selling ammunition having a caliber less than 20mm or, in the
case of Primex, its business of manufacturing and selling propellant powder and
if the resulting, surviving or transferee entity is engaged in or controlled,
directly or indirectly, by any person who is engaged in, in the case of an
assignment by Primex, the manufacture or sale of ammunition having a caliber
less than 20mm or shotshells, and, in the case of an assignment by Olin, the
manufacture or sale of propellant powder for ammunition, the assigning Party
shall notify the other Party of its election to assign this agreement and the
other Party for a period of thirty (30) days after receipt of said notice shall
have the right to terminate this Agreement upon providing written notice to the
assigning Party and the resulting, surviving or transferee entity.
20. INDEPENDENT PRICING AND QUANTITY AUDITS:
During the Term of this Agreement, and any renewal Terms thereof, each
Party (the "Auditing Party") shall have the right to appoint an independent
third party acceptable to the other Party (the "Audited Party"), to conduct an
audit of the relevant records of the Audited Party (including but not limited
to: (i) if Primex is the Audited Party, Primex's accounting and sales records,
and (ii) if Olin is the Audited Party, Olin's accounting and purchase records)
to determine compliance with the agreed to pricing and quantity requirement
procedures. The Audited Party agrees to make its records and employees
reasonably available to the auditors to promote the efficient and accurate
completion of the audit. Any discrepancies discovered by the audit shall be
resolved by mutual agreement between the Parties. The Auditing Party shall pay
the third party auditor for the audit. The Parties agree that the auditor shall
be instructed to keep the Audited Party's information confidential. The auditor
shall only report to the Auditing Party: (i) whether or not the Audited Party is
in compliance with the agreed to pricing and quantity requirement provisions
and, (ii) if the auditor reports that Audited Party is not in compliance with
any aspect of the pricing provisions the auditor shall only reveal to the
Auditing Party that portion of the Audited Party's information necessary to
identify the non-compliance. Under no circumstances shall the auditor disclose:
(i) to Olin the identity of Primex's customers, or (ii) to Primex the identity
of Olin's suppliers.
21. NOTICES:
All notices and other communications hereunder shall be in writing and hand
delivered or mailed by registered or certified mail (return receipt requested)
or sent by any means of electronic message transmission (excluding voice mail)
with delivery confirmed (by voice or otherwise) to the parties at the following
addresses (or at such other addresses for a Party as shall be specified by like
notice) and will be deemed given on the date on which such notice is received:
If to Olin: Olin Corporation
Winchester Division
427 North Shamrock Street
East Alton, IL 62024
Attention: Director,
Winchester Operation
Fax no.: (618) 258-2919
If to Primex: Primex Technologies, Inc.
P.O. Box 222
St. Marks, Florida 32355-0222
Attention: Director, St. Marks
Operation
Fax no.: (904) 925-2404
and
10101 Ninth Street North
St. Petersburg, FL 33716-3807
Attention: General Counsel
Fax no.: (813) 578-8795
Either Party may change their address by a notice given to the other Party
in the manner set forth above.
22. CHOICE OF LAW:
This Agreement shall be governed by and construed in accordance with the
laws of the State of Illinois, excluding its choice of law rules.
23. DISPUTE RESOLUTION:
In the event of a controversy, dispute or claim arising out of, in
connection with, or in relation to the interpretation, performance,
nonperformance, validity or breach of this Agreement or otherwise arising out
of, or in any way related to this Agreement, including, without limitation, any
claim based on contract, tort, statute or constitution (collectively, "Agreement
Disputes"), the General Counsels of the relevant Parties or their designees
shall negotiate in good faith for a reasonable period of time to settle such
Agreement Dispute. If after such reasonable period such General Counsels or
their designees are unable to settle such Agreement Dispute (and in any event
after 60 days have elapsed from the time the relevant parties began such
negotiations), such Agreement Dispute shall be determined, at the request of any
relevant party, by arbitration conducted in St. Louis, Missouri before and in
accordance with the then-existing Rules for Commercial Arbitration of the
American Arbitration Association (the "Rules"), and any judgment or award
rendered by the arbitrator shall be final, binding and nonappealable (except
upon grounds specified in 9 U.S.C. 10(a) as in effect on the date hereof), and
judgment may be entered by any state or Federal court having jurisdiction
thereof in accordance with Section 9.19 hereof. Unless the arbitrator otherwise
determines, the pre-trial discovery of the then-existing Federal Rules of Civil
Procedure and the then-existing Rules 12, 13, and 13.1 of the Rules of the
United States District Court for the Southern District of Illinois shall apply
to any arbitration hereunder. Any controversy concerning whether an Agreement
Dispute is an arbitrable Agreement Dispute, whether arbitration has been waived,
whether an assignee of this Agreement is bound to arbitrate, or as to the
interpretation or enforceability of this Section 23, shall be determined by the
arbitrator. The arbitrator shall be a retired or former judge of any United
States District Court or Court of Appeals or such other qualified person as the
relevant parties may agree to designate, PROVIDED such individual has had
substantial professional experience with regard to settling commercial disputes.
The parties intend that the provisions to arbitrate set forth herein be valid,
enforceable and irrevocable. The designation of a situs or a governing law for
this Agreement or the arbitration shall not be deemed an election to preclude
application of the Federal Arbitration Act, if it would be applicable. In his
award the arbitrator shall allocate, in his discretion, among the parties to the
arbitration all costs of the arbitration, including, without limitation, the
fees and expenses of the arbitrator and reasonable attorneys' fees, costs and
expert witness expenses of the parties. The undersigned agree to comply with
any award made in any such arbitration proceedings that has become final in
accordance with the Rules and agree to the entry of a judgment in any
jurisdiction upon any award rendered in such proceedings becoming final under
the Rules. The arbitrator shall be entitled, if appropriate, to award any
remedy in such proceedings, including, without limitation, monetary damages,
specific performance and all other forms of legal and equitable relief;
PROVIDED, HOWEVER, the arbitrator shall not be entitled to award punitive
damages.
24. CONSENT TO JURISDICTION:
Without limiting the provisions of Section 23 hereof, each of the parties
irrevocably submits to the exclusive personal jurisdiction and venue of (a) the
Circuit Court of the Third Judicial Circuit, Madison County, Illinois, and (b)
the United States District Court for the Southern District of Illinois for the
purposes of any suit, action or other proceeding arising out of this Agreement
or any transaction contemplated hereby. Each of the parties agrees to commence
any action, suit or proceeding relating hereto either in the United States
District Court for the Southern District of Illinois or if such suit, action or
other proceeding may not be brought in such court for jurisdictional reasons, in
the Circuit Court of the Third Judicial Circuit, Madison County, Illinois. Each
of the parties further agrees that service of any process, summons, notice or
document by U.S. registered mail to such Party's respective address set forth
above shall be effective service of process for any action, suit or proceeding
in Illinois with respect to any matters to which it has submitted to
jurisdiction in this Section 24. Each of the parties irrevocably and
unconditionally waives any objection to the laying of venue of any action, suit
or proceeding arising out of this Agreement or the transactions contemplated
hereby in (i) the Circuit Court of the Third Judicial Circuit, Madison County,
Illinois, or (ii) the United States District Court for the Southern District of
Illinois, and hereby further irrevocably and unconditionally waives and agrees
not to plead or claim in any such court that any such action, suit or proceeding
brought in any such court has been brought in an inconvenient forum.
25. GOVERNMENT REQUIREMENTS:
The Products are on the U.S. Munitions list, and may not be exported from
the U.S. without a license from the U.S. Department of State, which license
shall indicate the country of ultimate destination of such Products. In
addition, U.S. law prohibits the sale, transfer, or other disposition of
Products of U.S. origin to certain countries without authorization. Olin shall
not resell, divert, transfer, transship, reship or re-export, or use Products on
the U.S. Munitions list in or to any country other than that described on the
U.S. export license for the Products as the country of ultimate destination,
without the prior written approval of the U.S. Department of State.
26. MISCELLANEOUS:
(a) AMENDMENTS. The Parties hereto acknowledge and agree that in the
interest of time, certain matters of a practical business nature such as minor
changes in delivery dates, shipment instructions, small variances in orders and
the like may be orally agreed to by the Parties provided that any disputes that
arise from such oral agreements shall not constitute breaches of this Agreement.
(b) SUCCESSORS AND ASSIGNS. The provisions of this Agreement shall be
binding upon, inure to the benefit of and be enforceable by the Parties and
their respective successors and permitted assigns.
(c) ASSIGNABILITY. This Agreement shall be assignable in whole in
connection with a merger or consolidation of a Party hereto or the sale of all
or substantially all the assets related to Olin's business of manufacturing and
selling ammunition having a caliber less than 20mm and shotshells or Primex's
business of manufacturing and selling propellant powder so long as the
resulting, surviving or transferee entity assumes all the obligations of the
relevant Party hereto by operation of law or pursuant to an agreement in form
and substance reasonably satisfactory to the other Party to this Agreement.
Otherwise this Agreement shall not be assignable, in whole or in part, directly
or indirectly, by any Party hereto without the prior written consent of the
other, and any attempt to assign any rights or obligations arising under this
Agreement without such consent shall be void. Prior to any assignment, Olin and
Primex shall meet to review the Agreement and make changes and adjustments to
the Agreement as both Parties, in good faith, agree are mutually beneficial.
(d) WAIVERS. The failure of either Party to require strict performance by
the other Party of any provision in this Agreement will not waive or diminish
that Party's right to demand strict performance thereafter of that or any other
provision hereof.
(e) SEVERABILITY. In the event any one or more of the provisions
contained in this Agreement should be held invalid, illegal or unenforceable in
any respect, the validity, legality and enforceability of the remaining
provisions contained herein and therein shall not in any way be affected or
impaired thereby. The Parties shall endeavor in good-faith negotiations to
replace the invalid, illegal or unenforceable provisions with valid provisions,
the economic effect of which comes as close as possible to that of the invalid,
illegal or unenforceable provisions.
(f) TITLE AND HEADINGS. Titles and headings to sections herein are
inserted for the convenience of reference only and are not intended to be a part
of or to affect the meaning or interpretation of this Agreement.
(g) COMPLETE AGREEMENT; CONSTRUCTION. This Agreement, including the
Exhibits and the pricing agreements referenced in Section 3 above, shall
constitute the entire agreement between the parties with respect to the subject
matter hereof and shall supersede all previous negotiations, commitments and
writings with respect to such subject matter. In the event of any inconsistency
between this Agreement and any Exhibit hereto and said pricing agreement, the
Exhibit and pricing agreement shall prevail. The terms and conditions of this
Agreement shall prevail over any terms or conditions contained on purchase
orders, sales acknowledgments, or the like for Products under this Agreement.
(h) Sections 9, 14, 15, 16, 17, 22, 23, 24 and 25 shall survive the
termination of this Agreement.
(i) EXHIBITS. The Exhibits shall be construed with and as an integral
part of this Agreement to the same extent as if the same had been set forth
verbatim herein.
(j) THIRD PARTY BENEFICIARIES. This Agreement is solely for the benefit
of the Parties hereto and their respective subsidiaries and affiliates and
should not be deemed to confer upon third parties any remedy, claim, liability,
reimbursement, claim of action or other right in excess of those existing
without reference to this Agreement.
(j) ATTORNEY FEES. A Party in breach of this Agreement shall, on demand,
indemnify and hold harmless the other Party hereto for and against all out-of-
pocket expenses, including, without limitation, legal fees, incurred by such
other Party by reason of the enforcement and protection of its rights under this
Agreement. The payment of such expenses is in addition to any other relief to
which such other Party may be entitled hereunder or otherwise.
IN WITNESS WHEREOF, this Agreement has been executed by the duly
authorized representatives of each Party as of the day and year first above
written.
OLIN CORPORATION
By: /s/Johnnie M. Jackson, Jr.
-------------------------------
Johnnie M. Jackson, Jr.
Vice President, General Counsel and
Secretary
PRIMEX TECHNOLOGIES, INC.
By: /s/George H. Pain
---------------------
George H. Pain
Title: Vice President
Exhibit 10.5
ASSIGNMENT OF BALL POWDER TRADEMARK TO PRIMEX AND LIMITED LICENSE TO OLIN
THIS AGREEMENT is made and entered into as of December 30, 1996 by and
between:
OLIN CORPORATION, having a place of business at 427 North Shamrock Street,
East Alton, Illinois 62024, (hereinafter referred to as "OLIN")
AND
PRIMEX TECHNOLOGIES, INC., having a place of business at 10101 Ninth Street
North, St. Petersburg, Florida 33716-3807 (hereinafter referred to as
"PRIMEX") (hereinafter collectively the "PARTIES" and each individually a
"PARTY").
W I T N E S S E T H:
WHEREAS, OLIN and PRIMEX have entered into that certain Distribution
Agreement dated as of December 30, 1996 concerning the spin-off of PRIMEX
from OLIN (the "Distribution Agreement");
WHEREAS, pursuant to the Distribution Agreement, the operations of OLIN's
Ordnance Division relating to the manufacture and distribution of Ball
Powder[R] ellant will be transferred to PRIMEX;
WHEREAS, OLIN has prior to the EFFECTIVE DATE entered into the BROWNING
AGREEMENT which provides Browning S.A. with certain exclusive rights and
licenses to use the Ball Powder[R] trademark in a certain territory as
defined in that agreement;
WHEREAS, to allow each of OLIN and PRIMEX (and their respective
shareholders) to obtain the full value of its respective rights under the
Distribution Agreement, PRIMEX and OLIN desire to enter into and execute
this AGREEMENT concerning the assignment of the Ball Powder[R] trademark to
PRIMEX along with the good will of the business relating thereto and the
licensing of OLIN thereunder so as to enable OLIN to fulfill its
obligations to Browning S.A. under the BROWNING AGREEMENT;
NOW, THEREFORE, in consideration of the above, and the mutual promises set
forth below, OLIN and PRIMEX agree as follows:
1. DEFINITIONS
Whenever used in this agreement, the following terms shall have the
following meanings, on the understanding that words in the singular include
the plural and vice-versa. Headings and subheadings are used for
convenience only and are not intended as limitations in the AGREEMENT or
for use in interpreting the AGREEMENT.
1.1 AFFILIATE
"AFFILIATE" shall have the meaning ascribed thereto in the BROWNING
AGREEMENT.
1.2 AGREEMENT
"AGREEMENT" shall mean this agreement as amended and/or supplemented from
time to time, including all the EXHIBITS attached hereto.
1.3 BROWNING AGREEMENT
"BROWNING AGREEMENT" shall mean the Winchester License Agreement For
Shotshell & Hunting And Shooting Accessories For Europe between BROWNING
S.A. and OLIN, dated December 30, 1991 as set forth in EXHIBIT A as well as
any amendments thereto.
1.4 BROWNING S.A.
"BROWNING S.A." shall mean Browning S.A., a company organized under the
laws of the Kingdom of Belgium and having a principal office at Parc
Industriel des Hauts-Sarts, 3rd, Avenue, B-4040 Herstal, Belgium, or its
successors.
1.5 EFFECTIVE DATE
"EFFECTIVE DATE" shall mean the Effective Time specified in the
Distribution Agreement.
1.6 HUNTING AND SHOOTING ACCESSORY PRODUCTS
"HUNTING AND SHOOTING ACCESSORY PRODUCTS" shall have the meaning ascribed
thereto in the BROWNING AGREEMENT.
1.7 SHOTSHELL PRODUCTS
"SHOTSHELL PRODUCTS" shall have the meaning ascribed thereto in the
BROWNING AGREEMENT.
1.8 TERRITORY
"TERRITORY" shall have the meaning ascribed thereto in the BROWNING
AGREEMENT.
1.9 TERM
"TERM" shall have the meaning ascribed thereto in the BROWNING AGREEMENT.
1.10 TRADEMARKS
"TRADEMARKS" shall have the meaning ascribed thereto in the BROWNING
AGREEMENT but only as it relates to the Ball Powder[R] trademark.
2. ASSIGNMENT OF THE TRADEMARKS
2.1 ASSIGNMENT
OLIN agrees to assign and transfer to PRIMEX upon the EFFECTIVE DATE all of
its right, title and interest in and to the BALL POWDER trademarks set
forth in EXHIBIT B together with the good will of the business relating
thereto, pursuant to an assignment document in the form as set forth in
EXHIBIT C.
2.2 ACCEPTANCE OF ASSIGNMENT
PRIMEX agrees to accept the assignment pursuant to Section 2.1.
2.3 DISCLAIMER
OLIN CORPORATION MAKES NO REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED,
WITH RESPECT TO THE TRADEMARKS ASSIGNED HEREBY, INCLUDING WITHOUT
LIMITATION AS TO VALIDITY, ENFORCEABILITY OR FITNESS FOR ANY PARTICULAR USE
OR PURPOSE.
3. LICENSES
3.1 LICENSE TO OLIN
Subject to the assignment of the BALL POWDER[R] trademarks to PRIMEX
pursuant to Section 2.1, PRIMEX grants to OLIN all such rights and licenses
as may be necessary to fulfill its obligations under the BROWNING
AGREEMENT, including without limitation, the right to grant BROWNING S.A.
the following licenses:
a) the exclusive right and license to use the TRADEMARKS in connection with
the manufacture, distribution, sale, and advertising of SHOTSHELL PRODUCTS in
the TERRITORY; and
b) the exclusive right and license to use the TRADEMARKS for HUNTING AND
SHOOTING ACCESSORY PRODUCTS in the TERRITORY.
3.2 OLIN OBLIGATION
Upon the license of Section 3.1 becoming effective, OLIN shall for the
benefit of PRIMEX abide by the terms of the BROWNING AGREEMENT as they
relate to the TRADEMARKS.
3.3 PRIMEX COOPERATION
Upon the license of Section 3.1 becoming effective, PRIMEX shall cooperate
with OLIN and provide such assistance to OLIN as shall be reasonably
necessary to enable OLIN to effectuate the terms of the BROWNING AGREEMENT.
4. TERM OF AGREEMENT
This AGREEMENT shall become effective on the EFFECTIVE DATE, and shall
continue in full force and effect until the expiration of the BROWNING
AGREEMENT.
5. GUARANTEES, LIABILITIES AND INDEMNITIES
5.1 DISCLAIMER
Neither PARTY shall be liable to the other for indirect, special or
consequential damages arising out of this AGREEMENT.
6. NOTICES
Notices or requests to be given or made hereunder shall be delivered in
person or sent by registered mail or telefax or telex acknowledged by the
operator of the addressee at the following addresses or other addresses
that each PARTY may from time to time designate
(a) for PRIMEX:
PRIMEX TECHNOLOGIES, INC.
10101 Ninth Street North
St. Petersburg, Florida 33716-3807
ATTENTION: Corporate Secretary
Tel: (813)578-1116
Fax: (813)578-8795
(b) for OLIN:
OLIN CORPORATION
501 Merritt Seven
Norwalk, Connecticut 06856-4500
Attention: Corporate Secretary
Tel: (203) 356-3126
Fax: (203) 356-2011
7. ASSIGNMENT
The AGREEMENT shall not be assigned by either PARTY except as permitted by
the BROWNING AGREEMENT.
8. MISCELLANEOUS
8.1 ENTIRE AGREEMENT
The AGREEMENT embodies the entire understanding of the PARTIES. No
amendment or modification of the AGREEMENT shall be valid or binding upon
the PARTIES unless it is in writing and signed by the respective duly
authorized officers of the PARTIES.
8.2 PARTIES ARE INDEPENDENT
The AGREEMENT does not and shall not be deemed to make either PARTY the
agent, legal representative or partner of the other PARTY for any purpose
whatsoever, and neither PARTY shall have the right or authority to assume
or create any obligation or responsibility whatsoever, expressed or
implied, on behalf of or in the name of the other PARTY or to bind the
other PARTY in any respect whatsoever.
8.3 WAIVER
The failure of either PARTY at any time to require performance by the other
PARTY of any provision hereof shall in no way affect the full right to
require such performance within a reasonable time or thereafter the
performance of that and all other provisions, nor shall the waiver of any
succeeding breach of such provision or any other provision operate as a
waiver of the provision itself.
8.4 SEVERABILITY
The invalidity or unenforceability of any one or more of the provisions of
the AGREEMENT shall not affect the validity or enforceability of the
remaining provisions.
8.5 GOVERNING LAW
This Agreement shall be construed and governed, in all respects, by
the law of the State of Illinois applicable to contracts made and to be
performed in that state without reference to any provisions relating to
conflicts of law.
8.6 JURISDICTION
Each PARTY hereby irrevocably and unconditionally submits, for itself and
its property, to the nonexclusive jurisdiction of any Illinois State court
or Federal court of the United States of America sitting anywhere within a
radius of 50 miles from East Alton, Illinois, and any appellate court from
any thereof, in any action or proceeding arising out of or relating to this
Agreement, or for recognition or enforcement of any judgment, and each of
the PARTIES hereby irrevocably and unconditionally agrees that all claims
in respect of any such action or proceeding may be heard and determined in
such [Illinois] State or, to the extent permitted by law, in such Federal
court. Each of the PARTIES hereto agrees that a final judgment in any such
action or proceeding shall be conclusive and may be enforced in other
jurisdictions by suit on the judgment or in any other manner provided by
law.
8.7 VENUE
Each PARTY hereby irrevocably and unconditionally waives, to the fullest
extent it may legally and effectively do so, any objection that it may now
or hereafter have to the laying of venue of any suit, action or proceeding
arising out of or relating to this Agreement in any [Illinois] State court
or such Federal court located in the State of [Illinois]. Each of the
PARTIES hereto hereby irrevocably waives, to the fullest extent permitted
by law, the defense of an inconvenient forum to the maintenance of such
action or proceeding in any such court.
8.8 SERVICE OF PROCESS
Each Party to this Agreement irrevocably consents to service of process in
the manner provided for notices in ARTICLE 7 hereof. Nothing in this
Agreement will affect the right of any party to this Agreement to serve
process in any other manner permitted by law.
9. SETTLEMENT OF DISPUTES
In the event of any disputes arising out of or in connection with the
execution, interpretation, performance or nonperformance of this AGREEMENT,
except for disputes relating to infringement, validity or enforceability of
INTELLECTUAL PROPERTY, PRIMEX and OLIN shall use the following procedure
prior to either PARTY pursuing other available legal remedies:
9.1 ALTERNATIVE DISPUTE RESOLUTION
Upon signing of this Agreement each PARTY will designate one representative
("Representative") for the purpose of resolving disputes which may arise
from time to time. Upon a dispute arising, either or both Representatives
may request in writing a conference with the other. If so requested, the
conference shall occur within ten (10) days of the initial written request
and shall be held via telephone or at East Alton, Illinois, or elsewhere,
at the option of the Representatives. The purpose and scope of the
conference shall be limited to issues related to resolving the dispute. At
the conference, each Representative, or his or her designee, shall use best
efforts to attempt to resolve the dispute. If the dispute has not been
settled within thirty (30) days of the first meeting of the
Representatives, the parties shall establish a Management Appeal Board
("MAB") within ten (10) days of receipt of a request by either PARTY to set
up an MAB. The MAB shall consist of two (2) members of each respective
PARTY's management. The President of OLIN shall appoint two members to
represent OLIN and the President of PRIMEX shall appoint two members to
represent PRIMEX. The sole purpose of MAB shall be to resolve any dispute
over which the Representatives failed to resolve. The MAB members shall be
persons other than the Representatives. The MAB shall meet at East Alton,
Illinois or otherwise confer to resolve the dispute by good faith
negotiations, which may include presentations by the Representatives or
others.
9.2 ARBITRATION
In the event the parties are unable to resolve their disputes after
availing themselves of the processes set forth in Section 13.1 above for a
period of ninety (90) days, such disputes, shall be solely and finally
settled by three arbitrators in accordance with the Commercial Arbitration
Rules of the AAA (the "Arbitration Rules"). The PARTY electing arbitration
shall so notify the other PARTY in writing in accordance with the
Arbitration Rules, and such notice shall be accompanied by the name of the
arbitrator selected by the PARTY serving the notice. The second arbitrator
shall be chosen by the other PARTY, and a neutral arbitrator shall be
chosen by the two arbitrators so selected. If a PARTY fails to select an
arbitrator or to advise the other PARTY of its selection within thirty (30)
days after receipt by such a PARTY of the notice of the intent to
arbitrate, the second arbitrator shall be selected by the AAA. If the
third arbitrator shall not have been selected within thirty (30) days after
the selection of the second arbitrator, the appointment shall be made by
the AAA. All such proceedings shall be conducted in New York, New York.
The arbitrator shall make detailed findings of fact and law in writing in
support of the decision of the arbitrator panel, and is empowered to award
reimbursement of attorneys' fees and other costs of arbitration to the
prevailing PARTY, in such manner as the arbitrator panel shall deem
appropriate. The provisions of this Section 13.2 shall not be deemed to
preclude any PARTY hereto from seeking preliminary injunctive relief to
protect or enforce its rights hereunder, or to prohibit any court from
making preliminary findings of fact in connection with granting or denying
such preliminary injunctive relief, or to preclude any PARTY hereto from
seeking permanent injunctive or other equitable relief after and in
accordance with the decision of the arbitrator panel. Whether any claim or
controversy is arbitrable or litigable shall be determined solely by the
arbitrator panel pursuant to the provisions of this Section 13.2. Any
monetary award of the arbitrators panel shall include interest from the
date of any breach or any violation of this Agreement. The arbitrators
shall fix an appropriate rate of interest from the date of the breach or
other violation to the date when the award is paid in full. The parties
agree that judgment on the arbitration award may be entered in any court
having jurisdiction over the parties or their assets.
9.3 CONTINUING OBLIGATIONS
It is expressly agreed that the failure of the parties to resolve a dispute
on any issue to be resolved hereunder shall not relieve either PARTY from
any obligation set forth in this Agreement. In addition, notwithstanding
the pendency of any such dispute, neither PARTY will be excused of its
obligations hereunder to cooperate with the other to effectuate the
purposes of this Agreement.
9.4 COUNTERPARTS
This Agreement may be executed in any number of counterparts, each of
which shall be deemed an original, but all of this shall constitute one and
the same instrument
IN WITNESS WHEREOF the PARTIES hereto have caused this AGREEMENT to be
executed in duplicate as of the date first written above.
OLIN CORPORATION PRIMEX TECHNOLOGIES, INC.
By: /s/Johnnie M. Jackson, Jr. By: /s/George H. Pain
-------------------------- -----------------
Johnnie M. Jackson, Jr. George H. Pain
Vice President, General Counsel Vice President
and Secretary
Exhibit 10.6
ASSUMPTION OF LIABILITIES
AND
INDEMNITY AGREEMENT
This Assumption of Liabilities and Indemnity Agreement (this "Agreement")
is entered into as of December 31, 1996 by and between PRIMEX TECHNOLOGIES,
INC., a Virginia corporation, having its executive offices at 10101 Ninth Street
North, St. Petersburg, Florida 33716-3807 ("Primex"), and OLIN CORPORATION, a
Virginia corporation, having its executive offices at 501 Merritt 7, Norwalk,
Connecticut 06851 ("Olin") (Primex and Olin each being referred to as a "Party"
and collectively as the "Parties").
WITNESSETH:
WHEREAS, Olin and Primex have entered into that certain Distribution Agreement
dated as of December 30, 1996 concerning the spin-off of Primex from Olin (the
"Distribution Agreement"); and
WHEREAS, Olin and Primex desire to allocate certain liabilities and obligations
associated with their respective businesses;
NOW, THEREFORE, in consideration of the premises and of the mutual covenants
hereinafter set forth, the Parties hereby agree as follows:
I. PRIMEX ASSUMPTION AND INDEMNITY. Primex shall solely assume, and shall
indemnify and hold harmless Olin from and against:
A. All claims, damages, losses, liabilities, fines, penalties, costs and
expenses (including reasonable attorneys' fees and disbursements)
(collectively, "Liabilities") arising out of, associated with, or resulting
from the activities, business, operations, assets, properties, conduct or status
of Primex on or after the Effective Time (as defined in the Distribution
Agreement) except for the matter described in Article II.B below;
B. All Liabilities associated with the matters, current sites and
businesses described in Exhibit I, including, without limitation, those
Liabilities in connection with the removal, remediation or control of
environmental conditions at or associated with any of the sites identified
therein.
C. All Liabilities arising out of, associated with, or resulting from the
activities, business, operations, assets, properties, conduct or status of
Olin's Aerospace and Ordnance Divisions (including their respective constituent
Olin subsidiaries) prior to the Effective Time that are continued by Primex
following the Distribution (as defined in the Distribution Agreement) except
for the matter described in Article II.B below.
D. All Liabilities arising out of, associated with, or resulting from the
activities, business, operations, assets, properties, conduct or status of the
discontinued businesses and former sites related to Olin's Aerospace and
Ordnance Divisions (including their respective constituent Olin subsidiaries)
identified in Exhibit II, including, without limitation, Liabilities in
connection with the removal, remediation or control of environmental conditions
at any of the sites identified thereby and except for those matters described in
Article II.B and E below.
E. All Liabilities arising out of or resulting from or any of the
agreements and guarantees identified in Exhibit III except with respect to the
Partnership Agreement referred to in such Exhibit III only those Liabilities
accruing on or after the date the partnership interest under such Partnership
Agreement was transferred to Primex.
F. All Liabilities for employee benefits for which Primex is responsible
pursuant to Article VI of the Distribution Agreement.
G. All Liabilities arising out of, in connection with, or related to any
of the contracts with the U.S. Government, or any instruments or agreements
related thereto, that Olin was obligated to guarantee pursuant to the novation
of such contracts to Primex or its subsidiaries.
II. OLIN ASSUMPTION AND INDEMNITY. Olin shall solely assume, and shall
indemnify and hold harmless Primex from and against:
A. All Liabilities arising out of, associated with, or resulting from the
activities, business, operations, assets, properties, conduct or status of Olin
on or after the Effective Time;
B. Civil settlements, monetary judgments and legal fees and costs
(excluding without limitation obligations to fulfill the offset requirement), in
each case incurred and paid after the Effective Time, all in connection with the
Belgium Legal Matter described in Exhibit IV.
C. All other Liabilities arising out of, associated with, or resulting
from the activities, business, operations, assets, properties, conduct or status
of Olin prior to the Effective Time except for those described in Article I
above.
D. All claims and Liabilities for employee benefits for which Olin is
responsible pursuant to Article VI of the Distribution Agreement.
E. All Liabilities arising out of, associated with, or resulting from the
activities, business, operations, assets, properties, conduct or status of
Ravenna Army Ammunition Plant in Ravenna, Ohio and the Badger Army Ammunition
Plant in Baraboo, Wisconsin, including without limitation close-out costs,
unfunded pension costs, and unfunded retiree benefit cost.
F. All Liabilities arising out of or resulting from the Partnership
Agreement referred to in Exhibit III hereto that accrued prior to the date
the partnership interest arising under such Partnership Agreement was
transferred to Primex.
III. INSURANCE MATTERS. The amount which any indemnifying Party is or may be
required to pay to any indemnified Party hereunder shall be reduced (including,
without limitation, retroactively) by any proceeds of insurance policies or
other amounts actually recovered by or on behalf of such indemnified Party in
reduction of the related Liability. If an indemnified Party shall have received
the payment (an "Indemnity Payment") required by this Agreement from an
indemnifying Party in respect of any Liability and shall subsequently actually
receive proceeds of insurance policies or other amounts in respect of such
Liability, then such indemnified Party shall pay to such indemnifying Party a
sum equal to the amount actually received (up to but not in excess of the amount
of any Indemnity Payment made hereunder). An insurer who would otherwise be
obligated to pay any claim shall not be relieved of the responsibility with
respect thereto, or, solely by virtue of the indemnification provisions hereof,
have any subrogation rights with respect thereto, it being expressly understood
and agreed that no insurer or any other third party shall be entitled to a
benefit they would not otherwise be entitled to receive in the absence of the
indemnification provisions hereof by virtue of the indemnification provisions
hereof.
IV. PROCEDURES FOR INDEMNIFICATION.
A. THIRD PARTY CLAIMS. If a claim or demand is made against an
indemnified Party by any person who is not a party to this Agreement (a "Third
Party Claim") as to which such indemnified Party is entitled to indemnification
pursuant to this Agreement, such indemnified Party shall notify the indemnifying
Party in writing, and in reasonable detail, of the Third Party Claim promptly
(and in any event within 15 business days) after receipt by such indemnified
Party of written notice of the Third Party Claim; provided, however, that
failure to give such notification shall not affect the indemnification provided
hereunder except to the extent the indemnifying Party shall have been actually
prejudiced as a result of such failure (except that the indemnifying Party shall
not be liable for any expenses incurred during the period in which the
indemnified Party failed to give such notice). Thereafter, the indemnified
Party shall deliver to the indemnifying Party, promptly (and in any event within
15 business days) after the indemnified Party's receipt thereof, copies of all
notices and documents (including court papers) received by the indemnified Party
relating to the Third Party Claim.
If a Third Party Claim is made against an indemnified Party, the
indemnifying Party shall be entitled to participate in the defense thereof and,
if it so chooses and acknowledges in writing its obligation to indemnify the
indemnified Party therefor, to assume the defense thereof with counsel selected
by the indemnifying Party; provided, however, that such counsel is not
reasonably objected to by the indemnified Party. Should the indemnifying Party
so elect to assume the defense of a Third Party Claim, the indemnifying Party
shall not be liable to the indemnified Party for legal or other expenses
subsequently incurred by the indemnified Party in connection with the defense
thereof. If the indemnifying Party assumes such defense, the indemnified Party
shall have the right to participate in the defense thereof and to employ
counsel, at its own expense, separate from the counsel employed by the
indemnifying Party, it being understood that the indemnifying Party shall
control such defense. The indemnifying Party shall be liable for the fees and
expenses of counsel employed by the indemnified Party for any period during
which the indemnifying Party has failed to assume the defense thereof (other
than during the period prior to the time the indemnified Party shall have given
notice of the Third Party Claim as provided above). If the indemnifying Party
so elects to assume the defense of any Third Party Claim, the indemnified Party
shall cooperate with the indemnifying Party in the defense or prosecution
thereof.
If the indemnifying Party acknowledges in writing its obligation to
indemnify the indemnified Party for a Third Party Claim, then in no event will
the indemnified Party admit any liability with respect to, or settle, compromise
or discharge, any Third Party Claim without the indemnifying Party's prior
written consent; provided, however, that the indemnified Party shall have the
right to settle, compromise or discharge such Third Party Claim without the
consent of the indemnifying Party if the indemnified Party releases the
indemnifying Party from its indemnification obligation hereunder with respect to
such Third Party Claim and such settlement, compromise or discharge would not
otherwise adversely affect the indemnifying Party. If the indemnifying Party
acknowledges in writing its obligation to indemnify the indemnified Party for a
Third Party Claim, the indemnified Party will agree to any settlement,
compromise or discharge of a Third Party Claim that the indemnifying Party may
recommend and that by its terms obligates the indemnifying Party to pay the full
amount of the liability in connection with such Third Party Claim and releases
the indemnified Party completely in connection with such Third Party Claim and
that would not otherwise adversely affect the indemnified Party; provided,
however, that the indemnified Party may refuse to agree to any such settlement,
compromise or discharge if the indemnified Party agrees that the indemnifying
Party's indemnification obligation with respect to such Third Party Claim shall
not exceed the amount that would be required to be paid by or on behalf of the
indemnifying Party in connection with such settlement, compromise or discharge.
Notwithstanding the foregoing, the indemnifying Party shall not be entitled
to assume the defense of any Third Party Claim (and shall be liable for the fees
and expenses of counsel incurred by the indemnified Party in defending such
Third Party Claim) if the Third Party Claim seeks an order, injunction or other
equitable relief or relief for other than money damages against the indemnified
Party which the indemnified Party reasonable determines, after conferring with
its counsel, cannot be separated from any related claim for money damages. If
such equitable relief or other relief portion of the Third Party Claim can be so
separated from that for money damages, the indemnifying Party shall be entitled
to assume the defense of the portion relating to money damages.
B. INDEMNIFICATION PAYMENTS. Indemnification required by this Agreement,
shall be made by periodic payments of the amount thereof during the course of
the investigation or defense, as and when bills are received or loss, liability,
claim, damages or expense is incurred.
C. OTHER ADJUSTMENTS.
(1) The amount of any indemnification obligation with respect to any
Third Party Claim ("Indemnity Obligation") shall be (x) increased to take into
account any net tax cost actually incurred by the indemnified Party arising from
any payments received from the indemnifying Party (grossed up for such increase)
and (y) reduced to take into account any net tax benefit actually realized by
the indemnified Party arising from the incurrence or payment of any such
Indemnity Obligation. In computing the amount of such tax cost or tax benefit,
the indemnified Party shall be deemed to recognize all other items of income,
gain, loss, deduction or credit before recognizing any item arising from the
receipt of any payment with respect to an Indemnity Obligation or the incurrence
or payment of any Indemnity Obligation.
(2) In addition to any adjustments required pursuant to Article III
hereof or clause (1) of this paragraph C., if the amount of any Indemnity
Obligation shall, at any time subsequent to the payment required by this
Agreement, be reduced by recovery, settlement or otherwise, the amount of such
reduction, less any expenses incurred in connection therewith, shall promptly be
repaid by the indemnified Party to the indemnifying Party up to the aggregate
amount of any payments received from such Indemnifying Party pursuant to this
Agreement in respect of such Indemnity Obligation.
V. CONSOLIDATION, MERGER, TRANSFER, OR LEASE. Neither Party shall consolidate
with or merge into any other person, or convey, transfer or lease its properties
and assets substantially as an entirety to any other person, and neither Party
shall permit any person to consolidate with or merge into it or convey, transfer
or lease its properties and assets substantially as an entirety to said Party
unless:
A. In any case in which either Party shall consolidate with or merge into
another person or convey, transfer or lease its properties and assets
substantially as an entirety to any person, the person formed by such
consolidation or into which said Party is merged or the person which acquires by
conveyance or transfer, or which leases the properties and assets of said Party
substantially as an entirety shall (i) be a corporation, (ii) be organized and
validly existing under the laws of the United States of America, any State
thereof or the District of Columbia and (iii) expressly assume, by an instrument
satisfactory to the other Party, each and every obligation of said Party to be
performed or observed hereunder;
B. In the case Primex is the Party involved, after giving effect to such
transaction, the person formed by such consolidation or into which Primex is
merged or the person which acquires by conveyance, transfer or lease the
properties and assets of Primex substantially as an entirety must have
consolidated stockholders' equity, as determined in accordance with generally
accepted accounting principles, at least equal to the consolidated stockholders'
equity of Primex immediately prior to the consummation of such transaction; and
C. Said Party shall have delivered to the other Party a Certificate
executed by its Chief Executive Officer and Chief Financial Officer stating that
such consolidation, merger, conveyance, transfer or lease comply with this
Article V and that all conditions precedent herein relating to such transaction
have been complied with.
VI. NOTICES. All notices and other communications hereunder shall be in
writing and hand delivered or mailed by registered or certified mail (return
receipt requested) or sent by any means of electronic message transmission with
delivery confirmed (by voice or otherwise) to the Parties at the following
addresses (or at such other addresses for a Party as shall be specified by like
notice) and will be deemed given on the date on which such notice is received:
To Olin Corporation:
501 Merritt 7
P.O. Box 4500
Norwalk, CT 06851
Attn: General Counsel
To Primex:
10101 Ninth Street North
St. Petersburg, FL 33716-3807
Attn: General Counsel
VII. DISPUTE RESOLUTION. In the event of a controversy, dispute or claim arising
out of, in connection with, or in relation to the interpretation, performance,
nonperformance, validity or breach of this Agreement or otherwise arising out
of, or in any way related to this Agreement, including, without limitation, any
claim based on contract, tort, statute or constitution (collectively, "Agreement
Disputes"), the General Counsels of the relevant Parties or their designees
shall negotiate in good faith for a reasonable period of time to settle such
Agreement Dispute. If after such reasonable period such General Counsels or
their designees are unable to settle such Agreement Dispute (and in any event
after 60 days have elapsed from the time the relevant Parties began such
negotiations), such Agreement Dispute shall be determined, at the request of any
relevant party, by arbitration conducted in St. Louis, Missouri before and in
accordance with the then-existing Rules for Commercial Arbitration of the
American Arbitration Association (the "Rules"), and any judgment or award
rendered by the arbitrator shall be final, binding and nonappealable (except
upon grounds specified in 9 U.S.C. 10(a) as in effect on the date hereof), and
judgment may be entered by any state or Federal court having jurisdiction
thereof in accordance with Section 9.19 hereof. Unless the arbitrator otherwise
determines, the pre-trial discovery of the then-existing Federal Rules of Civil
Procedure and the then-existing Rules 12, 13, and 13.1 of the Rules of the
United States District Court for the Southern District of Illinois shall apply
to any arbitration hereunder. Any controversy concerning whether an Agreement
Dispute is an arbitrable Agreement Dispute, whether arbitration has been waived,
whether an assignee of this Agreement is bound to arbitrate, or as to the
interpretation or enforceability of this Section VII shall be determined by the
arbitrator. The arbitrator shall be a retired or former judge of any United
States District Court or Court of Appeals or such other qualified person as the
relevant Parties may agree to designate, provided such individual has had
substantial professional experience with regard to settling commercial disputes.
The Parties intend that the provisions to arbitrate set forth herein be valid,
enforceable and irrevocable. The designation of a situs or a governing law for
this Agreement or the arbitration shall not be deemed an election to preclude
application of the Federal Arbitration Act, if it would be applicable. In his
award the arbitrator shall allocate, in his discretion, among the Parties to the
arbitration all costs of the arbitration, including, without limitation, the
fees and expenses of the arbitrator and reasonable attorneys' fees, costs and
expert witness expenses of the Parties. The undersigned agree to comply with
any award made in any such arbitration proceedings that has become final in
accordance with the Rules and agree to the entry of a judgment in any
jurisdiction upon any award rendered in such proceedings becoming final under
the Rules. The arbitrator shall be entitled, if appropriate, to award any
remedy in such proceedings, including, without limitation, monetary damages,
specific performance and all other forms of legal and equitable relief;
provided, however, the arbitrator shall not be entitled to award punitive
damages.
VIII. CONSENT TO JURISDICTION. Without limiting the provisions of Section
VII hereof, each of the Parties irrevocably submits to the exclusive personal
jurisdiction and venue of (a) the Circuit Court of the Third Judicial Circuit,
Madison County, Illinois, and (b) the United States District Court for the
Southern District of Illinois for the purposes of any suit, action or other pro
ceeding arising out of this Agreement or any transaction contemplated hereby.
Each of the Parties agrees to commence any action, suit or proceeding relating
hereto either in the United States District Court for the Southern District of
Illinois or if such suit, action or other proceeding may not be brought in such
court for jurisdictional reasons, in the Circuit Court of the Third Judicial
Circuit, Madison County, Illinois. Each of the Parties further agrees that
service of any process, summons, notice or document by U.S. registered mail to
such Party's respective address set forth above shall be effective service of
process for any action, suit or proceeding in Illinois with respect to any
matters to which it has submitted to jurisdiction in this Section VIII. Each of
the Parties irrevocably and unconditionally waives any objection to the laying
of venue of any action, suit or proceeding arising out of this Agreement or the
transactions contemplated hereby in (i) the Circuit Court of the Third Judicial
Circuit, Madison County, Illinois, or (ii) the United States District Court for
the Southern District of Illinois, and hereby further irrevocably and
unconditionally waives and agrees not to plead or claim in any such court that
any such action, suit or proceeding brought in any such court has been brought
in an inconvenient forum.
IX. SURVIVAL. All the indemnity obligations under this Agreement shall survive
indefinitely.
X. GENERAL.
A. COMPLETE AGREEMENT; CONSTRUCTION. This Agreement, including the
Exhibits, shall constitute the entire agreement between the Parties with respect
to the subject matter hereof and shall supersede all previous negotiations,
commitments and writings with respect to such subject matter. In the event of
any inconsistency between this Agreement and any Schedule hereto, the Schedule
shall prevail.
B. AMENDMENTS. This Agreement may not be modified or amended except by an
agreement in writing signed by the Parties.
C. WAIVER. The failure of either Party to require strict performance by
the other Party of any provision in this Agreement will not waive or diminish
that Party's right to demand strict performance thereafter of that or any other
provision hereof.
D. SEVERABILITY. In the event any one or more of the provisions
contained in this Agreement should be held invalid, illegal or unenforceable in
any respect, the validity, legality and enforceability of the remaining
provisions contained herein and therein shall not in any way be affected or
impaired thereby. The Parties shall endeavor in good-faith negotiations to
replace the invalid, illegal or unenforceable provisions with valid provisions,
the economic effect of which comes as close as possible to that of the invalid,
illegal or unenforceable provisions.
E. GOVERNING LAW. This Agreement shall be governed and construed in
accordance with the laws of the State of Illinois, excluding its choice of law
provisions.
F. SUCCESSORS AND ASSIGNS. The provisions of this Agreement shall be
binding upon, inure to the benefit of and be enforceable by the Parties and
their respective successors and permitted assigns.
G. ATTORNEY FEES. A Party in breach of this Agreement shall, on demand,
indemnify and hold harmless the other Parties hereto for and against all out-of-
pocket expenses, including, without limitation, legal fees, incurred by such
other Party by reason of the enforcement and protection of its rights under this
Agreement. The payment of such expenses is in addition to any other relief to
which such other Party may be entitled hereunder or otherwise.
H. TITLE AND HEADINGS. Titles and headings to sections herein are
inserted for the convenience of reference only and are not intended to be a part
of or to affect the meaning or interpretation of this Agreement.
I. EXHIBITS. The Exhibits shall be construed with and as an integral
part of this Agreement to the same extent as if the same had been set forth
verbatim herein.
IN WITNESS WHEREOF, this Agreement has been executed by the duly authorized
representatives of Olin and Primex as of the date first above written.
PRIMEX TECHNOLOGIES, INC. OLIN CORPORATION
By: /s/George H. Pain By: /s/Johnnie M. Jackson, Jr.
----------------- --------------------------
George H. Pain Johnnie M. Jackson, Jr.
Vice President Vice President, General Counsel
and Secretary
EXHIBIT I
A. GENERAL LITIGATION AND CLAIMS
1. Weiser Security Services, Inc. vs. Olin Corporation (Pinellas County,
District Court), Case No. 94-6662-CO-41. This is a breach of contract action
brought by former contractor Weiser against Olin for the hiring of security
guards previously employed by Weiser in violation of non-compete covenants in
the contract.
2. Conco Claim. Conco, Inc. has submitted a claim against Olin in excess of
$400,000 for expenses incurred in producing subcontract metal ammunition cans to
defective government specifications.
3. Wharton Realty Associates, L.L.C. v. Biltmore Realty Co., Inc., Valentec
International, Inc. General Defense Corporation d/b/a Flinchbaugh Operations,
Olin Corporation, et. al. (Pending in Superior Court of New Jersey, Morris
County, Law Division) Docket No. L-3505-94. This is a suit by a former landlord
of GDC at Rockaway Industrial Complex in Wharton, New Jersey, where GDC leased a
building from 1979 to 1984, to recover the expense of remediating hydrocarbon
contamination around a heating oil tank near the building. Olin recently settled
this matter.
4. Iran BALL POWDER[R] Plant. (Potential Litigation) The Ministry of
Defense, Tehran, Iran, has requested arbitration of a dispute over U.S.
Government cancellation of a 1974 contract between MOD and Olin to construct a
BALL POWDER[R] plant in Iran. U.S. State Department regulations prohibit
performance of the contract by Olin.
5. Pease vs. OAC (Wrongful Termination, Age Discrimination & Damages).
Superior Court State of Washington, County of King. Damages not specified.
Plaintiff's counsel has notified OAC of his intent to voluntarily dismiss the
case "without prejudice". Plaintiff could refile anytime prior to May 1997.
6. Multi-year II Contract Defective Pricing Claim. Administrative Contracting
Officer. The claim amount is $600,000.00 which is to be negotiated. OAC has
agreed to adjust the contract price. The amount has not been negotiated.
Currently there is no outside counsel representing Olin.
7. Threatened Litigation (McCann). McCann was a short service employee hired
in 1992 as the Environmental Health and Safety Coordinator. In late 1994 his
performance deteriorated, and the company decided to terminate him. After the
decision but before the implementation, McCann came into the office and
announced that he had cancer which required treatment, for which he needed to be
on disability leave. Upon his return to work in January, 1995, he was
terminated. He was offered additional severance and other benefits, in return
for which he signed a release. His attorney now claims that he was terminated
for his involvement in a co-worker's worker's compensation claim for $60,000.
9. Eddie Hill vs. KASL Enterprises et al. Plaintiff alleges he lost his hand
in a trash compactor made by General Defense (Autopak). Autopak was sold by
General Defense before it was acquired by Olin. The case is pending in Wayne
County (Detroit), Michigan.
10. Stewart vs. Olin. The Illinois Department of Human Rights has filed a
Complaint with the Illinois Human Rights Commission on behalf of Donald Stewart,
a current employee at Marion, alleging discrimination with respect to terms and
conditions of employment by Stewart's foreman.
11. Benedicta Lusk vs. Olin Corporation. Lusk is a female management-level
employee at Downey (former 30mm Program Manager) who has filed a charge with
EEO.
12. George Alcantara v. Olin Corporation. Alcantara a former hourly
maintenance employee, has filed a charge with the California Department of Fair
Employment and Housing, alleging national origin discrimination in connection
with his recent layoff from the Downey facility. Alcantara is Mexican-American.
13. Western Processing Site, Washington. Olin Aerospace has obligations to
make payments toward remediation pursuant to a 1986 Consent Decree.
14. Aqua-Tech Environmental, Inc. Hamilton Technology, Inc., a former
subsidiary of General Defense Corporation, is a PRP at this site in South
Carolina.
15. Maxey Flats. Hamilton Watch Company (HWC) is a PRP at the Maxey Flats
Nuclear Disposal Site in Flemming County, Kentucky. Hamilton Watch Company was
sold to SSIH of Bienne, Switzerland by General Defense Corporation (GDC) in 1973
prior to Olin's acquisition of GDC in 1988. SSIH is believed to have assumed
all of HWC's liabilities.
B. CURRENT SITES AND BUSINESSES
1. St. Petersburg, Florida. (Corporate headquarters and systems management
operation for large caliber ammunition.)
2. Red Lion, Pennsylvania. (Manufacturing and research and development
facility for large caliber ammunition metal and composite parts.)
3. Redmond, Washington. (Design, manufacturing and test facility for space,
solid propellant and electronic products, office facilities and research and
development laboratory.)
4. St. Marks, Florida. (Manufacturing facility for Ball Powder propellant and
Research and development laboratory.)
5. Marion, Illinois. (Loading, assembly and packing of medium caliber
ammunition, Manufacturing and test facility for solid propellant products, and
demilitarization services research and development laboratory.)
6. San Leandro, California. (Pulsed power research and development
laboratory, and test facilities; pulsed power and advanced warhead engineering
and management.)
7. Downey, California. (Manufacturing facility for medium caliber ammunition
components and air dispensed munitions components. System management and
research and development.)
8. Moses Lake, Washington. (Manufacturing and test facility for solid
propellant products.)
9. Camden, Arkansas, (Test range, support for the ammunition business.)
10. Tracy California. (Manufacturing and test facility for advanced anti-armor
warhead systems.)
11. Lucerne, Switzerland (Design, development and testing of anti-armor warhead
systems for the Swiss Government.)
EXHIBIT II
ORDNANCE-RELATED
IDENTIFIED DISCONTINUED BUSINESSES AND FORMER PLANT SITES
East Petersburg, PA (former Hamilton Technologies, Inc. (HTI) plant site) [a/k/a
"East Petersburg - GDC"]
Lancaster, PA (former HTI plant site) [a/k/a "Stoney Battery Road - HTI"]
Lancaster, PA (former HTI plant site) [a/k/a "Clock Towers"]
Largo, FL (former GDC plant site) [a/k/a "Largo - GDC"]
Socorro, NM (testing of DU projectiles)
Wharton, NJ (research and development facility) [a/k/a "Valentec Site"]
AEROSPACE-RELATED
DISCONTINUED BUSINESSES AND FORMER PLANT SITES
Bellevue, WA (construction and management of energy conservation systems)
[Trans Energy Systems, Inc.]
Bellevue, WA (former offices) [Pacific Electro Dynamics, Inc.]
Manhattan Beach, CA (offices for classified project) [Martin & Stern, Inc.]
Netherlands (offices)
Palo Alto, CA (offices and light manufacturing) [Larse Corporation]
Preston, WA (explosives manufacturing and test site) [Explosives Corporation of
America]
Reston (and surrounding area), VA (offices) [Martin & Stern, Inc.]
Santa Clara, CA (offices and light manufacturing) [Larse Corporation]
Seattle, WA (former offices) [Rocket Research Company]
Various gas well leases in West Virginia and Ohio (servicing at gas well sites)
[Petroleum Technology Corporation]
Wadsworth, OH (metal parts manufacturing)
Any sites or businesses discovered by Primex or Olin after the Effective Time
that are related solely to the businesses comprising Primex on the Effective
Time.
EXHIBIT III
1. Facility Lease, dated December 29, 1986, between The Connecticut National
Bank, as Trustee, and Physics International Company, as previously amended and
otherwise amended from time to time.
2. Ground Sublease, dated December 29, 1986, between The Connecticut National
Bank, as Trustee, and Physics International Company, as amended from time to
time.
3. Agreement of Guaranty No. 1, dated December 29, 1986, between Olin
Corporation and The Connecticut National Bank, as Trustee, as amended from time
to time.
4. Agreement of Guaranty No. 2, dated December 29, 1986, between Olin
Corporation and The Connecticut National Bank, as Trustee, as previously amended
and otherwise amended from time to time.
5. Trust Agreement, dated as of December 29, 1986, between Merced Associates
and The Connecticut National Bank, as amended from time to time.
6. Partnership Agreement, dated as of December 29, 1986, between Maryland
National Leasing Corporation and Olin Financial Services Inc., as amended from
time to time.
7. Note Purchase and Participation Agreement, dated as of March 9, 1987,
among The Connecticut National Bank, Physics International Company, and
various insurance companies named therein.
8. Indenture, dated as of December 29, 1986, between D. Heben Porteus, David
H. Haig, Fred C. Weyand, and Paul Mullin Ganley, as Trustees, The Connecticut
National Bank, as Trustee, and Merced Associates.
9. Purchase and Assignment Agreement, dated as of December 29, 1986, among
Connecticut National Bank, as Trustee, Merced Associates and Physics
International Company.
10. Credit Agreement, dated as of December 23, 1996, among Olin Corporation,
Primex Technologies, Inc., the Banks Parties thereto and Morgan Guarranty Trust
Company of New York as Agent, and the notes relating thereto.
EXHIBIT IV
BELGIUM LEGAL MATTER. The Company is involved in a contract dispute with
the Belgium Ministry of Defense related to a 1985 sale of tank ammunition. The
Belgium Ministry of Defense has alleged improprieties committed by the Belgium
national who represented Olin in the transaction. Based on these allegations,
the Belgium Ministry of Defense withheld final payment on the contract and the
Company agreed to extend a letter of credit related to the contract guarantee
pending a decision by the Belgium courts of the underlying contract dispute.
The trial court ruled against the Company. The decision has been appealed. In
the event that the trial court's decision is sustained, the resultant liability
is estimated at approximately $4.5 million.
EXHIBIT 10.7
COVENANT NOT TO COMPETE AGREEMENT
This Covenant Not to Compete Agreement ("Agreement") entered into as of
December 31, 1996 ("Effective Date"), by and between PRIMEX TECHNOLOGIES, INC.,
a Virginia corporation with its principal offices at 10101 Ninth Street North,
St. Petersburg, Florida 33716-3807 ("Primex"); and OLIN CORPORATION, a Virginia
corporation with offices at 427 North Shamrock, East Alton, Illinois 62024
("Olin") (Primex and Olin each being referred to as a "Party" and collectively
referred to as the "Parties").
W I T N E S S E T H:
WHEREAS, Olin and Primex have entered into that certain Distribution Agreement
dated as of December 30, 1996 concerning the spin-off of Primex from Olin (the
"Distribution Agreement");
WHEREAS, prior to entering into the Distribution Agreement, the Parties and
their predecessor businesses freely shared information concerning their
respective businesses, including but not limited to the research and development
of ammunition products and components, as these businesses were part of a single
corporate entity and parent-subsidiary corporate structure;
WHEREAS, Olin and Primex each have a substantial amount of know-how and other
knowledge concerning the operations of the business of the other entity;
WHEREAS, to allow each of Olin and Primex (and their respective shareholders) to
obtain the full value of its respective rights under the Distribution Agreement,
Primex and Olin desire to enter into and execute this Agreement concerning
Medium & Large Caliber Ammunition, Medium & Large Caliber Components, and Small
Caliber Ammunition & Components, as such terms are defined below, and not
concerning the many other products the Parties may make or have made.
NOW, THEREFORE, in consideration of the above, and the mutual promises set forth
below, Olin and Primex agree as follows:
1. DEFINITIONS.
(a) "AMMUNITION" is defined as cartridges, shotshells, projectiles, and blanks,
capable of being fired from a firearm, artillery piece, cannon, industrial
gun or other gun (collectively "Gun") by a propellant charge in such Gun or
cartridge (including but not limited to armor-piercing rounds, trace rounds,
incendiary rounds and/or explosive rounds), but shall not include (i)
unpropelled bombs, and (ii) rockets, mortars and other projectiles
substantially propelled by propellant contained within the projectile.
(b) "BUSINESS OF" shall mean the manufacture, fabrication, marketing, sale or
distribution of.
(c) "CANISTER POWDER" shall mean propellant powder, packaged for ultimate sale
to consumers in containers of twenty pounds of less.
(d) "ENGAGING IN" shall mean directly or indirectly to engage in, own, manage,
participate in, or otherwise obtain an interest in (as owner, stockholder,
agent, partner, representative, director, consultant, or otherwise).
(e) "GOCO OPERATION" shall mean any activity conducted by a Party hereto
pursuant to an agreement existing on or prior to the date first above written
(or an extension, renewal or other continuation of such an agreement concerning
the same facility as the prior agreement) with the federal government of the
United States of America by which such party operates or maintains an Ammunition
or Ammunition components (including powder) production facility for and on
behalf of such government; provided, however, that such term shall not include
any activity conducted at such facility that is not conducted by the respective
party on behalf of such government pursuant to such agreement (such as, but not
limited to, activity conducted by a respective party for its own account at such
facility, whether pursuant to a facilities use agreement with the government or
otherwise).
(f) "MEDIUM & LARGE CALIBER AMMUNITION & COMPONENTS" shall mean (i) fully-
loaded rounds of Ammunition having a diameter of 20 millimeters or larger, other
than shotshells and (ii) components of such fully-loaded rounds.
(g) "NONLETHAL AMMUNITION" shall mean Ammunition that is designed and intended
to minimize or avoid any injury, damage or death resulting from its use or
otherwise intended to be less-than-lethal, including but not limited to having
the effect of slowing or temporarily incapacitating an aggressor through means
intended to minimize or avoid permanent physical damage to the aggressor. The
term "Nonlethal Ammunition" does not include: (i) blanks, and (ii) any
Ammunition currently produced by the parties hereto, nor any developments
therefrom based on techniques historically used in the Ammunition industry for
delivering lethal or injurious force to an aggressor through the use of a metal
projectile.
(h) "OCSW AND OICW" shall mean the objective crew served weapon and the
objective individual combat weapon, respectively, being developed by Primex for
the U.S. Army.
(i) "OCSW AND OICW AMMUNITION" shall mean Ammunition used in OCSW and OICW
objective individual combat weapon, respectively, being developed by Primex for
the U.S. Army.
(j) "PENSION PLAN" shall mean, with respect to a Party and its affiliates, any
"employee pension benefit plan" or "pension plan", in each case as defined in
Title 1, subtitle A, Sec. 3(2) of the Employee Retirement Income Security Act of
1974, as amended, of such Party and its affiliates.
(k) "SMALL CALIBER AMMUNITION & COMPONENTS" shall mean (i) shotshells of any
gauge, (ii) fully-loaded rounds of Ammunition, other than Medium & Large Caliber
Ammunition, (iii) components of such shotshells and fully-loaded rounds, other
than propellant powder; and (iv) ejection cartridges (also known as "ARDs") for
aircraft stores ejection.
(l) "TERRITORY" shall mean the entire world.
2. AGREEMENT NOT TO COMPETE.
During the term of this Agreement:
(a) Olin shall not Engage In, without the prior written consent of Primex,
anywhere within the Territory, the Business Of Medium & Large Caliber Ammunition
& Components or propellant powder; provided, however, that nothing herein shall
prevent Olin from (i) Engaging In the Business Of individual component primers,
fuses, cups, propellants containing or derived from HAN, shellcases, and cones
for shaped charges prior to their assembly into Ammunition, including Medium &
Large Caliber Ammunition, and/or oil well penetrator cones; and/or (ii)
Engaging In the marketing, selling, and distributing of Canister Powder; and/or
(iii) Engaging In research and development of propellant powder as part of
the development, testing, trial production, prototype construction, and similar
activities associated with the Business Of Small Caliber Ammunition &
Components; and/or (iv) Engaging In any of its GOCO Operations, including the
Lake City Army Ammunition Plant located in Independence, Missouri, the Badger
Army Ammunition Plant located in Baraboo, Wisconsin and the Ravenna Army Arsenal
Plant located in Ravenna, Ohio; and/or (v) Engaging In the Business Of Nonlethal
Ammunition; and/or (vi) Engaging In the Business Of high explosives and other
primer material, and/or (vi) making an investment through a Pension Plan of Olin
or any of its subsidiaries.
(b) Primex shall not directly or indirectly Engage In, without the prior
written consent of Olin, anywhere within the Territory, the Business Of Small
Caliber Ammunition & Components; provided, however, that nothing herein shall
prevent Primex from (i) Engaging In the development, testing, trial production,
prototype construction and similar activities associated with, but not the
selling of, OCSW and OICW Ammunition; and/or (ii) Engaging In the Business Of
Nonlethal Ammunition; and/or (iii) making an investment through a Pension Plan
of Primex or any of its subsidiaries.
(c) Nothing herein shall prevent Olin and Primex from mutually
agreeing to develop or manufacture Ammunition or components cooperatively,
whether through subcontracting, work share arrangements, or joint
development projects.
3. TERM.
The term of this Agreement shall be for a five (5) year period commencing
on the Effective Date.
4. REASONABLENESS.
The parties hereto agree that the terms contained in this Agreement are
reasonable in all respects. In the event that a court determines that
any of the terms or provisions of this Agreement are unreasonable, the court
may limit the application of any provision or term, or modify any provision
or term, and proceed to enforce the Agreement as so limited or modified.
5. SEVERABILITY.
The parties hereto agree that each and every paragraph, sentence, term and
provision of this Agreement shall be considered severable in that, in the
event that a court finds any paragraph, sentence, term or provision to be
invalid or unenforceable, the validity and enforceability, operation or
effect of the remaining paragraphs, sentences, terms or provisions shall
not be affected, and this Agreement shall be construed in all respects as
if the invalid or unenforceable matter had been omitted. The parties shall
endeavor in good faith negotiations to replace the invalid, illegal or
unenforceable provisions with valid provisions, the economic effect of
which comes as close as possible to that of the invalid, illegal or
unenforceable provisions. The parties intend the covenants of Section 2 to
be a series of separate covenants, one for each county of each and every
state, province, territory or political jurisdiction of the Territory and
one for each month of the period specified above. If, in any arbitration
or judicial proceeding, an arbitrator or a court shall refuse to enforce
any one or more of such separate covenants because the total time and/or
the geographic boundaries thereof are deemed to be excessive or
unreasonable, then it is the intent of the parties hereto that such
covenants, which would otherwise be unenforceable due to such excessive or
unreasonable period of time and/or geography, be enforced for such lesser
period of time and/or for such more limited geographic area as shall be
deemed reasonable and not excessive by such arbitrator or court.
6. SPECIFIC PERFORMANCE.
Each of the parties hereto acknowledges that there is no adequate remedy at
law for failure by such parties to comply with the provisions of this
Agreement and that such failure would cause immediate harm that would not
be adequately compensable in damages, and therefore agree that their
agreements contained herein may be specifically enforced without the
requirement of posting a bond or other security, in addition to all other
remedies available to the parties hereto under this Agreement.
7. DISPUTE RESOLUTION. In the event of a controversy, dispute or claim
arising out of, in connection with, or in relation to the interpretation,
performance, nonperformance, validity or breach of this Agreement or
otherwise arising out of, or in any way related to this Agreement,
including, without limitation, any claim based on contract, tort, statute
or constitution (collectively, "Agreement Disputes"), the General Counsels
of the relevant Parties or their designees shall negotiate in good faith
for a reasonable period of time to settle such Agreement Dispute. If after
such reasonable period such General Counsels or their designees are unable
to settle such Agreement Dispute (and in any event after 60 days have
elapsed from the time the relevant parties began such negotiations), such
Agreement Dispute shall be determined, at the request of any relevant
party, by arbitration conducted in St. Louis, Missouri before and in
accordance with the then-existing Rules for Commercial Arbitration of the
American Arbitration Association (the "Rules"), and any judgment or award
rendered by the arbitrator shall be final, binding and nonappealable
(except upon grounds specified in 9 U.S.C. Section 10(a) as in effect on
the date hereof), and judgment may be entered by any state or Federal court
having jurisdiction thereof in accordance with Section 9.19 hereof. Unless
the arbitrator otherwise determines, the pre-trial discovery of the then-
existing Federal Rules of Civil Procedure and the then-existing Rules 12,
13, and 13.1 of the Rules of the United States District Court for the
Southern District of Illinois shall apply to any arbitration hereunder.
Any controversy concerning whether an Agreement Dispute is an arbitrable
Agreement Dispute, whether arbitration has been waived, whether an assignee
of this Agreement is bound to arbitrate, or as to the interpretation or
enforceability of this Section 7 shall be determined by the arbitrator.
The arbitrator shall be a retired or former judge of any United States
District Court or Court of Appeals or such other qualified person as the
relevant parties may agree to designate, provided such individual has had
substantial professional experience with regard to settling commercial
disputes. The parties intend that the provisions to arbitrate set forth
herein be valid, enforceable and irrevocable. The designation of a situs
or a governing law for this Agreement or the arbitration shall not be
deemed an election to preclude application of the Federal Arbitration Act,
if it would be applicable. In his award the arbitrator shall allocate, in
his discretion, among the parties to the arbitration all costs of the
arbitration, including, without limitation, the fees and expenses of the
arbitrator and reasonable attorneys' fees, costs and expert witness
expenses of the parties. The undersigned agree to comply with any award
made in any such arbitration proceedings that has become final in
accordance with the Rules and agree to the entry of a judgment in any
jurisdiction upon any award rendered in such proceedings becoming final
under the Rules. The arbitrator shall be entitled, if appropriate, to
award any remedy in such proceedings, including, without limitation,
monetary damages, specific performance and all other forms of legal and
equitable relief; provided, however, the arbitrator shall not be entitled
to award punitive damages.
8. ATTORNEY FEES. A Party in breach of this Agreement shall, on demand,
indemnify and hold harmless the other parties hereto for and against all
out-of-pocket expenses, including, without limitation, legal fees, incurred
by such other Party by reason of the enforcement and protection of its
rights under this Agreement. The payment of such expenses is in addition
to any other relief to which such other Party may be entitled hereunder or
otherwise.
9. NOTICES.
All notices and other communications hereunder shall be in writing and hand
delivered or mailed by registered or certified mail (return receipt
requested) or sent by any means of electronic message transmission with
delivery confirmed (by voice or otherwise) to the Parties at the following
addresses (or at such other addresses for a Party as shall be specified by
like notice) and will be deemed given on the date on which such notice is
received:
To Olin Corporation:
501 Merritt 7
P.O. Box 4500
Norwalk, CT 06851
Attn: General Counsel
To Primex:
10101 Ninth Street North
St. Petersburg, FL 33716-3807
Attn: General Counsel
10. SUCCESSORS.
This Agreement shall be binding upon and shall inure to the benefit of and
be enforceable by the Parties and their respective successors and permitted
assigns.
11. APPLICABLE LAW.
This Agreement shall be governed by and construed in accordance with the
laws of the State of Illinois, without giving effect to its conflict of
laws provisions.
12. CONSENT TO JURISDICTION.
Without limiting the provisions of Section 7 hereof, each of the parties
irrevocably submits to the exclusive personal jurisdiction and venue of (a)
the Circuit Court of the Third Judicial Circuit, Madison County, Illinois,
and (b) the United States District Court for the Southern District of
Illinois for the purposes of any suit, action or other proceeding arising
out of this Agreement or any transaction contemplated hereby. Each of the
parties agrees to commence any action, suit or proceeding relating hereto
either in the United States District Court for the Southern District of
Illinois or if such suit, action or other proceeding may not be brought in
such court for jurisdictional reasons, in the Circuit Court of the Third
Judicial Circuit, Madison County, Illinois. Each of the parties further
agrees that service of any process, summons, notice or document by U.S.
registered mail to such party's respective address set forth above shall be
effective service of process for any action, suit or proceeding in Illinois
with respect to any matters to which it has submitted to jurisdiction in
this Section 12. Each of the parties irrevocably and unconditionally
waives any objection to the laying of venue of any action, suit or
proceeding arising out of this Agreement or the transactions contemplated
hereby in (i) the Circuit Court of the Third Judicial Circuit, Madison
County, Illinois, or (ii) the United States District Court for the Southern
District of Illinois, and hereby further irrevocably and unconditionally
waives and agrees not to plead or claim in any such court that any such
action, suit or proceeding brought in any such court has been brought in an
nconvenient forum.
13. MISCELLANEOUS.
(a) AMENDMENTS. This Agreement may not be modified or amended except
by an agreement in writing signed by the Parties.
(b) WAIVERS. The failure of either Party to require strict
performance by the other party of any provision in this Agreement will
not waive or diminish that Party's right to demand strict performance
thereafter of that or any other provision hereof.
(c) TITLE AND HEADINGS. Titles and headings to sections herein are
inserted for the convenience of reference only and are not intended to
be a part of or to affect the meaning or interpretation of this
Agreement.
(d) THIRD PARTY BENEFICIARIES. This Agreement is solely for the
benefit of the parties hereto and their respective Subsidiaries and
Affiliates and should not be deemed to confer upon third parties any
remedy, claim, liability, reimbursement, claim of action or other
right in excess of those existing without reference to this Agreement.
(e) COMPLETE AGREEMENT; CONSTRUCTION. This Agreement shall constitute the
entire agreement between the Parties with respect to the subject
matter hereof and shall supersede all previous negotiations,
commitments and writings with respect to such subject matter.
IN WITNESS WHEREOF, the Parties have executed this Agreement as of the date
and year first above written.
PRIMEX TECHNOLOGIES, INC.
By: George H. Pain
------------------------
George H. Pain
Vice President
OLIN CORPORATION
By: Johnnie M. Jackson, Jr.
-------------------------
Johnnie M. Jackson, Jr.
Vice President, General Counsel and Secretary
EXHIBIT 10.8
ASSIGNMENT OF RAUFOSS AGREEMENTS TO PRIMEX AND SUBLICENSE TO OLIN FOR SMALL
CALIBER AMMUNITION
THIS AGREEMENT is made and entered into as of December 30, 1996 by and between:
OLIN CORPORATION, having a place of business at 427 North Shamrock Street, East
Alton, Illinois 62024 (hereinafter referred to as "OLIN")
AND
PRIMEX TECHNOLOGIES, INC., having a place of business at 10101 Ninth Street
North, St. Petersburg, Florida 33716-3807 (hereinafter referred to as "PRIMEX")
(hereinafter collectively the "PARTIES" and each individually a "PARTY").
W I T N E S S E T H:
WHEREAS, OLIN and PRIMEX have entered into that certain Distribution Agreement
dated as of December 30, 1996 concerning the spin-off of PRIMEX from OLIN (the
"Distribution Agreement");
WHEREAS, prior to entering into the Distribution Agreement, OLIN and Raufoss
A/S, a corporation organized under the laws of Norway, (formerly A/S Raufoss
Ammunisjonsfabrikker) entered into a number of agreements relating to
multipurpose ammunition, which prior to the spin-off of PRIMEX have been
exploited by PRIMEX and OLIN's Winchester Division as those businesses were part
of a single corporate entity and parent-subsidiary corporate structure;
WHEREAS, Raufoss A/S and Olin Corporation entered into a technology and patent
license agreement effective as of May 1, 1984 (hereinafter defined as the
"RAUFOSS LICENSE") enabling Olin to manufacture and sell ammunition in a
licensed territory employing Raufoss' Multipurpose Concept ("MPC") technology
and patents;
WHEREAS, the RAUFOSS LICENSE has been amended pursuant to Amendments No. 1 and
No. 2 and by an Addendum No. 1 to Amendment No. 2;
WHEREAS, on December 15, 1992 Olin Corporation, acting through its Ordnance
Division, and Raufoss A/S entered into a TEAMING AGREEMENT (hereinafter defined
as the "TEAMING AGREEMENT") providing for cooperation in the manufacture and
sale of certain multipurpose ammunition under the RAUFOSS LICENSE and/or a
license granted by Raufoss A/S to the U. S. Government relating to such
multipurpose ammunition;
WHEREAS, the TEAMING AGREEMENT has been amended through the addition of Annex II
entered into on June 16, 1993 and Annex III fully signed as of Oct. 3, 1994;
WHEREAS, PRIMEX desires OLIN to assign to PRIMEX the RAUFOSS LICENSE as amended
and the TEAMING AGREEMENT as amended, (hereinafter defined as the "RAUFOSS
AGREEMENTS") subject to the grant by PRIMEX to OLIN of an exclusive sublicense
under the RAUFOSS AGREEMENTS for small caliber ammunition of less than 20
millimeters in diameter and subject to the consent of Raufoss A/S to such
assignment and sublicense;
WHEREAS, to allow each of OLIN and PRIMEX (and their respective shareholders) to
obtain the full value of its respective rights under the Distribution Agreement,
PRIMEX and OLIN desire to enter into and execute this AGREEMENT concerning the
assignment of the RAUFOSS AGREEMENTS and the sublicensing of OLIN thereunder;
NOW, THEREFORE, in consideration of the above, and the mutual promises set forth
below, OLIN and PRIMEX agree as follows:
1. DEFINITIONS
Whenever used in this AGREEMENT, the following terms shall have the following
meanings, on the understanding that words in the singular include the plural and
vice-versa. Headings and subheadings are used for convenience only and are not
intended as limitations in the AGREEMENT or for use in interpreting the
AGREEMENT.
1.1 AFFILIATE
"AFFILIATE" shall mean, when used with respect to a specified PERSON, another
PERSON that directly, or indirectly through one or more intermediaries, CONTROLS
or is CONTROLLED by or is under common CONTROL with the PERSON specified.
1.2 AGREEMENT
"AGREEMENT" shall mean this agreement as amended and/or supplemented from time
to time, including all the EXHIBITS attached hereto.
1.3 CONFIDENTIAL INFORMATION
"CONFIDENTIAL INFORMATION" shall mean any and all information disclosed to the
receiving PARTY by the disclosing PARTY pursuant to the AGREEMENT, in any form
such as, but not limited to, visual, oral, written, graphic, electronic or model
form, including but not limited to know-how and trade secrets relating to the
LICENSED TECHNOLOGY, whether patented or not and whether in the laboratory,
pilot plant or commercial plant stage (including drawings, operating conditions,
specifications, safety instructions, recommendations for effluent disposal,
emergency instructions, etc.) owned or controlled by a PARTY.
1.4 CONTROL
"CONTROL" shall mean the possession, directly or indirectly, of the power to
direct or cause the direction of the management or policies of a Person, whether
through the ownership of voting securities, by contract or otherwise, and the
terms "CONTROLLING" and "CONTROLLED" shall have meanings correlative thereto.
1.5 EFFECTIVE DATE
"EFFECTIVE DATE" shall mean the Effective Time specified in the Distribution
Agreement or the date Raufoss A/S executes the Consent Agreement set forth in
Exhibit A, whichever is later.
1.6 IMPROVEMENTS
"IMPROVEMENTS" shall have the meaning ascribed thereto in the RAUFOSS LICENSE as
amended.
1.7 INTELLECTUAL PROPERTY
"INTELLECTUAL PROPERTY" shall mean all CONFIDENTIAL INFORMATION and all classes
or types of patents, utility models, design patents, copyrights and applications
for the aforementioned, of all countries of the world.
1.8 LICENSED PRODUCTS
"LICENSED PRODUCTS" shall have the meaning as set forth in the RAUFOSS
AGREEMENTS.
1.9 LICENSED TECHNOLOGY
"LICENSED TECHNOLOGY" shall have the meaning ascribed thereto in the RAUFOSS
LICENSE as amended.
1.10 MEDIUM & LARGE CALIBER PRODUCTS
"MEDIUM & LARGE CALIBER PRODUCTS" shall mean LICENSED PRODUCTS having a diameter
of 20 millimeters or more.
1.11 OCSW & OICW AMMUNITION
"OCSW AND OICW AMMUNITION" shall mean AMMUNITION used in objective crew served
weapon (OCSW) and objective individual combat weapon (OICW), respectively, being
developed by PRIMEX for the U.S. Army.
1.12 PERSON
"PERSON" shall mean any natural person, corporation, business trust, joint
venture, association, company, partnership or government, or any agency or
political sub-division thereof.
1.13 RAUFOSS AGREEMENTS
"RAUFOSS AGREEMENTS" shall mean the RAUFOSS LICENSE and the TEAMING AGREEMENT,
including without limitation, those agreements and amendments thereto as set
forth in Exhibit B and any future agreements or amendments relating to Licensed
Products entered into by Raufoss A/S and PRIMEX and/or OLIN during the Term.
The RAUFOSS AGREEMENTS are specifically incorporated by reference herein and
made a part of this AGREEMENT.
1.14 RAUFOSS LICENSE
"RAUFOSS LICENSE" shall mean the Licensing Agreement between A/S Raufoss
Ammunisjonsfabrikker (now Raufoss A/S) and Olin Corporation, Winchester Group
(now Olin Corporation, Winchester Division) effective as of May 1, 1984, as well
as any amendments thereto during the Term. Copies of the RAUFOSS LICENSE and
any amendments thereto as of the Effective Date are attached hereto as Exhibit
C.
1.15 SMALL CALIBER PRODUCTS
"SMALL CALIBER PRODUCTS" shall mean LICENSED PRODUCTS having a diameter of less
than 20 millimeters.
1.16 TEAMING AGREEMENT
"TEAMING AGREEMENT" shall mean the TEAMING AGREEMENT between Raufoss A/S and
Olin Corporation acting through its Defense Products Division ( now Ordnance
Division) entered into on December 15, 1992, as well as any amendments or
annexes thereto during the Term. Copies of the TEAMING AGREEMENT and any
amendments or annexes thereto as of the Effective Date are attached hereto as
Exhibit D.
1.17 TERM
"TERM" shall mean the period of time during which the AGREEMENT shall be in full
force and effect pursuant to ARTICLE 6.
2. ASSIGNMENT OF INTELLECTUAL PROPERTY
2.1 ASSIGNMENT
Subject to the execution by Raufoss A/S of the Consent Agreement set forth in
Exhibit A, effective as of the EFFECTIVE DATE, OLIN assigns and transfers to
PRIMEX all of its right, title and interest in and to the RAUFOSS AGREEMENTS in
force as of the EFFECTIVE DATE.
2.2 ACCEPTANCE OF ASSIGNMENT
PRIMEX agrees to accept the assignment pursuant to Section 2.1 and to be bound
on or after the EFFECTIVE DATE to all the terms and conditions of the assigned
RAUFOSS AGREEMENTS in the place of OLIN.
2.3 DISCLAIMER
OLIN CORPORATION MAKES NO REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, WITH
RESPECT TO THE RAUFOSS AGREEMENTS ASSIGNED HEREBY, INCLUDING WITHOUT LIMITATION
AS TO VALIDITY, ENFORCEABILITY OR FITNESS FOR ANY PARTICULAR USE OR PURPOSE.
3. LICENSES
3.1 LICENSE TO OLIN
Subject to the execution by Raufoss A/S of the Consent Agreement set forth in
Exhibit A, upon the EFFECTIVE DATE, PRIMEX and its AFFILIATES hereby grant and
agree to grant to OLIN an irrevocable, worldwide, sole and exclusive sublicense,
with the right to further sublicense subject to the terms of the RAUFOSS
AGREEMENTS, to utilize all of PRIMEX's rights and licenses under the RAUFOSS
AGREEMENTS with respect to the LICENSED TECHNOLOGY, for the making, having made,
use, offering for sale, selling and import of SMALL CALIBER PRODUCTS. Pursuant
to the license provided pursuant to this Section 3.1 OLIN shall have the
exclusive right for a period of five (5) years from the EFFECTIVE DATEas between
OLIN and PRIMEX to make SMALL CALIBER PRODUCTS, except for engaging In the
development, testing, trial production, prototype construction and similar
activities associated with OCSE & OICW AMMUNITION, under the RAUFOSS AGREEMENTS,
but solely to the extent of PRIMEX's or its AFFILIATES' rights and licenses
under the RAUFOSS AGREEMENTS.
3.2 LICENSE TO PRIMEX
Upon the EFFECTIVE DATE, OLIN and its AFFILIATES hereby grant and agree to grant
to PRIMEX an irrevocable, worldwide, sole and exclusive sublicense, with the
right to sublicense subject to the terms of the RAUFOSS AGREEMENTS, to utilize
all of OLIN's rights and licenses under RAUFOSS AGREEMENTS with respect to the
LICENSED TECHNOLOGY entered into by OLIN or its AFFILIATES after the EFFECTIVE
DATE, for the making, having made, use, offering for sale, selling and import of
MEDIUM & LARGE CALIBER PRODUCTS. Pursuant to the license of this Section 3.2
PRIMEX shall have the exclusive right as between OLIN and PRIMEX to make MEDIUM
& LARGE CALIBER PRODUCTS under such RAUFOSS AGREEMENTS, but solely to the extent
of OLIN's or its AFFILIATES', rights and licenses under such RAUFOSS AGREEMENTS.
Upon the EFFECTIVE DATE, OLIN and its AFFILIATES hereby grant and agree to grant
to PRIMEX an irrevocable, worldwide, non-exclusive sublicense, with the right to
sublicense subject to the terms of the RAUFOSS AGREEMENTS, to utilize all of
OLIN's rights and licenses under RAUFOSS AGREEMENTS with respect to the LICENSED
TECHNOLOGY entered into by OLIN or its AFFILIATES after the EFFECTIVE DATE, for
engaging In the development, testing, trial production, prototype construction
and similar activities associated with, but for a period of five (5) years from
the EFFECTIVE DATE not the selling of, OCSW AND OICW AMMUNITION.
3.3 LICENSE OF IMPROVEMENTS
Each PARTY agrees to grant to Raufoss A/S a license relating to such PARTY's
IMPROVEMENTS to the extent required by the RAUFOSS AGREEMENTS.
3.4 SUBLICENSE TERMS
Any sublicense granted by a sublicensee pursuant to this ARTICLE 3 shall be
consistent with and subject to the terms and conditions of this AGREEMENT and
the RAUFOSS AGREEMENTS applicable thereto.
3.5 ROYALTIES
If a licensor under this ARTICLE 3 is obligated to pay royalties pursuant to a
RAUFOSS AGREEMENT with respect to a license or right granted herein, then the
licensee shall be obligated to pay such royalties to its licensor as a condition
of its license.
3.6 COMPLIANCE WITH RAUFOSS AGREEMENTS
A licensee under this ARTICLE 3 in addition to being bound by and abiding by all
the terms and conditions of this AGREEMENT agrees to be bound by and abide by
all the terms and conditions of the RAUFOSS AGREEMENTS applicable to such
licensee's activities pursuant to this AGREEMENT. In the event that a
licensee's obligation to its licensor under this AGREEMENT conflicts with such
licensee's obligation under a RAUFOSS AGREEMENT, the obligations of the RAUFOSS
AGREEMENT shall control. Without limitation, a licensee under this ARTICLE 3
shall provide to its licensor such reports and payments as required by the
RAUFOSS AGREEMENTS applicable to such licensee's activities pursuant to this
AGREEMENT, in a timely manner, which will reasonably permit its licensor to
comply with the applicable RAUFOSS AGREEMENTS.
3.7 WARRANTY
The PARTIES warrant that as of the EFFECTIVE DATE they have not granted and will
not grant any rights or licenses which will conflict with the rights and
licenses set forth in this AGREEMENT. The PARTIES also warrant that as of the
EFFECTIVE DATE they have the right to grant the rights and licenses set forth in
this Agreement. NO OTHER WARRANTY, OF ANY KIND, WHETHER EXPRESS OR IMPLIED, IS
GIVEN BY ONE PARTY TO THE OTHER PARTY AND IN PARTICULAR THE PARTIES DISCLAIM ANY
WARRANTY THAT THEIR RESPECTIVE INTELLECTUAL PROPERTY ARE VALID OR ENFORCEABLE OR
USEFUL FOR ANY PURPOSE.
3.8 EXPRESS LICENSES ONLY
Except for licenses expressly granted pursuant to ARTICLE 3, no licenses are
granted hereby, and nothing in the AGREEMENT shall be construed as, or result
in, conveying by implication, waiver or estoppel any right or license to either
PARTY or to any third party except Raufoss A/S pursuant to the RAUFOSS
AGREEMENTS.
3.9 FUTURE AGREEMENTS
Each PARTY agrees not to enter into future agreements which will conflict with
the rights of the other PARTY hereunder without the consent of the other PARTY,
which consent shall not be unreasonably withheld.
4. INTELLECTUAL PROPERTY
4.1 OWNERSHIP
INTELLECTUAL PROPERTY arising out of this AGREEMENT shall be owned as follows:
(I) INTELLECTUAL PROPERTY developed solely by OLIN employees shall be owned by
OLIN; (ii) INTELLECTUAL PROPERTY developed solely by employees of PRIMEX shall
be owned by PRIMEX; and (iii) INTELLECTUAL PROPERTY developed jointly by
employees of PRIMEX and OLIN shall be jointly owned by OLIN and PRIMEX.
4.2 APPLICATION FOR PATENT RIGHTS
The right to apply for and obtain INTELLECTUAL PROPERTY arising out of this
AGREEMENT with respect to a solely owned invention under Section 4.1 shall
belong to and be vested in the PARTY entitled to ownership of such invention.
Any and all costs and expenses incurred for applying for, obtaining and
maintaining such patent rights shall be borne by the owner thereof. Each PARTY
shall, at its own expense, secure the execution by its employees of any
documents and any necessary government licenses required to obtain such
INTELLECTUAL PROPERTY and the appropriate assignment thereof. The PARTIES shall
mutually agree upon which PARTY shall have the right to apply, in the names of
both OLIN and PRIMEX, for INTELLECTUAL PROPERTY developed jointly by employees
of both OLIN and PRIMEX. The PARTIES shall equally share the cost of making
such joint application and maintaining such joint INTELLECTUAL PROPERTY rights.
Should either PARTY decline to join in such joint application or to bear its
equal share of such costs, either for preparation, fees or maintenance, in the
United States of America or in any other country, the PARTY declining to join in
such joint application or to bear its share of the costs shall be deemed to have
abandoned its rights to such INTELLECTUAL PROPERTY and shall transfer its
interest therein to the other PARTY.
4.3 ABANDONING JOINTLY OWNED INTELLECTUAL PROPERTY
If either PARTY wishes to abandon in any country any jointly owned INTELLECTUAL
PROPERTY right or application therefor arising out of this AGREEMENT, it shall
not do so without first notifying the other PARTY and giving it a reasonable
opportunity to take over the prosecution or maintenance of such INTELLECTUAL
PROPERTY right at its own expense. If the other PARTY agrees to take over the
prosecution and maintenance of such INTELLECTUAL PROPERTY the abandoning PARTY
shall transfer its interest therein to such other PARTY.
5. SECRECY
5.1 SECRECY OBLIGATION
In addition to their obligations under the RAUFOSS AGREEMENTS each of the
PARTIES agrees to keep confidential and neither disclose to others nor use
except as permitted herein any CONFIDENTIAL INFORMATION received from the other
PARTY pursuant to the AGREEMENT.
5.2 LIMITS ON DISCLOSURE
The receiving PARTY shall treat such CONFIDENTIAL INFORMATION in the same manner
and with the same degree of care as it uses with respect to its own CONFIDENTIAL
INFORMATION of like nature and shall disclose CONFIDENTIAL INFORMATION of the
other PARTY only to its employees who have a need to know it, provided that such
employees are bound to respect all secrecy obligations provided for in the
AGREEMENT.
5.3 EXCEPTIONS
The obligation set forth in Section 5.1 shall not apply with respect to any
CONFIDENTIAL INFORMATION which:
5.3.1 PUBLIC KNOWLEDGE
Is generally available to the public or subsequently becomes generally available
to the public through no breach by the receiving PARTY of secrecy obligations
under this Agreement or prior agreements between the PARTIES concerning the
CONFIDENTIAL INFORMATION; or
5.3.2 PRIOR POSSESSION
The receiving PARTY can establish by competent evidence was in its possession at
the time of disclosure and was not acquired in confidence directly or
indirectly, from the disclosing PARTY; or
5.3.3 RECEIVED FROM THIRD PARTY
Is received from a third party who is legally free to disclose such CONFIDENTIAL
INFORMATION and who did not receive such CONFIDENTIAL INFORMATION in confidence
from the disclosing PARTY; or
5.3.4 APPROVED FOR DISCLOSURE
Is approved in writing for release by the disclosing PARTY; or
5.3.5 SUCCESSOR IN INTEREST
Is disclosed to any permitted assignee of the AGREEMENT, provided that such
assignee agrees to be bound by the provisions of the AGREEMENT; or
5.3.6 INDEPENDENTLY DEVELOPED
Is independently developed by the receiving PARTY without reference to the
CONFIDENTIAL INFORMATION received from the disclosing PARTY.
5.4 PERMITTED DISCLOSURES
The provisions of Section 5.1 notwithstanding, in exercising the rights granted
under the AGREEMENT, any PARTY may disclose CONFIDENTIAL INFORMATION to others
for purpose of licensing (as permitted hereunder), design, engineering,
construction or operation of facilities permitted using the disclosing PARTY's
licensed TECHNOLOGY; or obtaining or giving consulting services under a license
agreement permitted hereunder, provided that any third party to which such
CONFIDENTIAL INFORMATION is disclosed shall have first entered into a written
secrecy and non-use obligation at least as stringent as that imposed on the
PARTIES pursuant to the AGREEMENT.
5.5 SUBPOENA OR DEMAND
The provisions of Section 5.1 notwithstanding, a PARTY may disclose CONFIDENTIAL
INFORMATION pursuant to a subpoena or demand for production of documents in
connection with any suit or arbitration proceeding, any administrative procedure
or before a governmental or administrative agency or instrumentality thereof or
any legislative hearing or other similar proceeding, provided that the receiving
PARTY shall promptly notify the disclosing PARTY of the subpoena or demand and
provided further that in such instances, the PARTIES use their best efforts to
maintain the confidential nature of the CONFIDENTIAL INFORMATION by protective
order or other means.
6. DURATION AND TERMINATION
6.1 TERM OF AGREEMENT
This AGREEMENT shall become effective on the EFFECTIVE DATE, and shall continue
in full force and effect until the expiration of the last to expire of the
RAUFOSS AGREEMENTS. After expiration of the AGREEMENT pursuant to this Section
6.1 the rights and obligations set forth in Section 3.6 and ARTICLES 4, 5 and 10
shall continue in full force and effect until fully discharged. Except as
otherwise required by the RAUFOSS AGREEMENTS upon expiration pursuant to this
Section 6.1 both PARTIES shall have the right to use and license, subject to the
surviving obligations, but without accounting to the other, the LICENSED
TECHNOLOGY and IMPROVEMENTS licensed hereunder, whether owned exclusively or
jointly by either PARTY.
6.2 TERMINATION FOR MATERIAL BREACH
If either PARTY commits a material breach with respect to any of their
obligations hereunder, the other PARTY may give written notice to the allegedly
breaching PARTY specifying the alleged material breach and an intention to
terminate the AGREEMENT. The PARTY charged with the alleged material breach
shall have sixty (60) days from the date of receipt of such written notice to
cure the alleged material breach. If the alleged material breach is not cured
within said sixty (60)-day period, the other PARTY may terminate the AGREEMENT
by sending a written notice of termination to the breaching PARTY and in this
event, neither PARTY waives any legal rights to recover damages resulting from
the termination of the AGREEMENT.
6.3 INSOLVENCY
In the event that either PARTY shall: (I) become insolvent or go into
liquidation or receivership or be admitted to the benefits of any procedure for
the settlement or postponement of debts or be declared bankrupt; or (ii) becomes
party to dissolution proceedings; then the AGREEMENT and any and all obligations
assumed hereby (except as otherwise expressly provided for herein) may be
terminated by the other PARTY, if permitted by law, by giving written notice of
such termination on a date specified therein.
6.4 OBLIGATIONS SURVIVING TERMINATION FOR FAULT
Upon termination pursuant to Sections 6.2 or 6.3, the obligations of each PARTY
to the other shall cease except, the obligations set forth in Section 3.6 and
ARTICLES 4, 5 and 10 shall continue in full force and effect until completely
discharged.
7. FORCE MAJEURE
7.1 ACTS CONSTITUTING FORCE MAJEURE
Neither PARTY shall be liable to the other arising out of a delay in its
performance of this Agreement arising from causes beyond its reasonable control.
Without limiting the generality of the foregoing, such events include any act of
God; accident; explosion; fire; earthquake; flood; strikes; labor disputes;
riots; sabotage; embargo; equipment failure; federal, state, or local legal
restriction or limitation; failure or delay of transportation; shortage of, or
inability to obtain, raw materials, supplies, equipment, fuel, electricity, or
labor. Neither PARTY shall be required to resolve labor disputes or disputes
with suppliers of raw material, supplies, equipment, fuel, or electricity, but
shall use commercially reasonable efforts to seek alternative sources to the
extent practicable.
7.2 NOTICE REQUIREMENT
When circumstances occur which delay the performance of either PARTY under this
Agreement, whether or not such circumstances are excused pursuant to Section 8.1
above, said PARTY shall, when it first becomes aware of such circumstances,
promptly notify (or, if the circumstances occur on a holiday or weekend, on the
first succeeding business day) the other PARTY, by facsimile or by telephone
confirmed in writing within two (2) business days in the case of oral notice.
Within ten (10) business days of the date when either PARTY first becomes aware
of the event which it contends is responsible for the delay, it shall supply to
the other PARTY in writing the reason(s) for and anticipated duration of such
delay, the measures taken and to be taken to prevent or minimize the delay, and
the timetable for the implementation of such measures.
8. GUARANTEES, LIABILITIES AND INDEMNITIES
8.1 LAWFUL POSSESSION
Each PARTY represents that to the best of its knowledge and belief, it will be
in the lawful possession of any CONFIDENTIAL INFORMATION when disclosed by it
pursuant to the AGREEMENT and that the disclosure of said CONFIDENTIAL
INFORMATION shall not in any way violate any agreement to hold such CONFIDENTIAL
INFORMATION in confidence.
8.2 DISCLAIMER
Neither PARTY shall be liable to the other for indirect, special or
consequential damages arising out of this AGREEMENT or any use of CONFIDENTIAL
INFORMATION or INTELLECTUAL PROPERTY rights obtained by it from the other PARTY
hereunder.
9. NOTICES
Notices or requests to be given or made hereunder shall be delivered in person
or sent by registered mail or telefax or telex acknowledged by the operator of
the addressee at the following addresses or other addresses that each PARTY may
from time to time designate
(a) for PRIMEX:
PRIMEX TECHNOLOGIES, INC.
10101 Ninth Street North
St. Petersburg, Florida 33716-3807
ATTENTION: Corporate Secretary
Tel: (813)578-1116
Fax: (813)578-8795
(b) for OLIN:
OLIN CORPORATION
501 Merritt Seven
Norwalk, Connecticut 06856-4500
Attention: Corporate Secretary
Tel: (203) 356-3126
Fax: (203) 356-2011
10. EXPORTATION CONTROL
Each PARTY agrees not to export or reexport, or cause to be exported, any
CONFIDENTIAL INFORMATION or LICENSED TECHNOLOGY furnished hereunder by the other
PARTY or the equipment constructed on the basis of such CONFIDENTIAL
INFORMATION, or the products manufactured with such CONFIDENTIAL INFORMATION or
LICENSED TECHNOLOGY to any country to which, under the laws of the country of
origin of the CONFIDENTIAL INFORMATION or LICENSED TECHNOLOGY, it is or may be
prohibited from exporting such CONFIDENTIAL INFORMATION or LICENSED TECHNOLOGY
or the direct product thereof.
11. ASSIGNMENT
The AGREEMENT shall not be assigned by either PARTY except as permitted by the
RAUFOSS AGREEMENTS.
12. MISCELLANEOUS
12.1 ENTIRE AGREEMENT
The AGREEMENT embodies the entire understanding of the PARTIES. No amendment or
modification of the AGREEMENT shall be valid or binding upon the PARTIES unless
it is in writing and signed by the respective duly authorized officers of the
PARTIES.
12.2 PARTIES ARE INDEPENDENT
The AGREEMENT does not and shall not be deemed to make either PARTY the agent,
legal representative or partner of the other PARTY for any purpose whatsoever,
and neither PARTY shall have the right or authority to assume or create any
obligation or responsibility whatsoever, expressed or implied, on behalf of or
in the name of the other PARTY or to bind the other PARTY in any respect
whatsoever.
12.3 WAIVER
The failure of either PARTY at any time to require performance by the other
PARTY of any provision hereof shall in no way affect the full right to require
such performance within a reasonable time or thereafter the performance of that
and all other provisions, nor shall the waiver of any succeeding breach of such
provision or any other provision operate as a waiver of the provision itself.
12.4 SEVERABILITY
The invalidity or unenforceability of any one or more of the provisions of the
AGREEMENT shall not affect the validity or enforceability of the remaining
provisions.
12.5 GOVERNING LAW
This Agreement shall be construed and governed, in all respects, by the
law of the State of [Illinois] applicable to contracts made and to be
performed in that state without reference to any provisions relating to
conflicts of law.
12.6 JURISDICTION
Each PARTY hereby irrevocably and unconditionally submits, for itself and its
property, to the nonexclusive jurisdiction of any [Illinois] State court or
Federal court of the United States of America sitting anywhere within a radius
of 50 miles from East Alton, [Illinois], and any appellate court from any
thereof, in any action or proceeding arising out of or relating to this
Agreement, or for recognition or enforcement of any judgment, and each of the
PARTIES hereby irrevocably and unconditionally agrees that all claims in respect
of any such action or proceeding may be heard and determined in such [Illinois]
State or, to the extent permitted by law, in such Federal court. Each of the
PARTIES hereto agrees that a final judgment in any such action or proceeding
shall be conclusive and may be enforced in other jurisdictions by suit on the
judgment or in any other manner provided by law.
12.7 VENUE
Each PARTY hereby irrevocably and unconditionally waives, to the fullest extent
it may legally and effectively do so, any objection that it may now or hereafter
have to the laying of venue of any suit, action or proceeding arising out of or
relating to this Agreement in any [Illinois] State court or such Federal court
located in the State of [Illinois]. Each of the PARTIES hereto hereby
irrevocably waives, to the fullest extent permitted by law, the defense of an
inconvenient forum to the maintenance of such action or proceeding in any such
court.
12.8 SERVICE OF PROCESS
Each Party to this Agreement irrevocably consents to service of process in the
manner provided for notices in ARTICLE 9 hereof. Nothing in this Agreement will
affect the right of any party to this Agreement to serve process in any other
manner permitted by law.
13. SETTLEMENT OF DISPUTES
In the event of any disputes arising out of or in connection with the execution,
interpretation, performance or nonperformance of this AGREEMENT, except for
disputes relating to infringement, validity or enforceability of INTELLECTUAL
PROPERTY, PRIMEX and OLIN shall use the following procedure prior to either
PARTY pursuing other available legal remedies:
13.1 ALTERNATIVE DISPUTE RESOLUTION
Upon signing of this Agreement each PARTY will designate one representative
("Representative") for the purpose of resolving disputes which may arise from
time to time. Upon a dispute arising, either or both Representatives may
request in writing a conference with the other. If so requested, the conference
shall occur within ten (10) days of the initial written request and shall be
held via telephone or at East Alton, Illinois, or elsewhere, at the option of
the Representatives. The purpose and scope of the conference shall be limited
to issues related to resolving the dispute. At the conference, each
Representative, or his or her designee, shall use best efforts to attempt to
resolve the dispute. If the dispute has not been settled within thirty (30)
days of the first meeting of the Representatives, the parties shall establish a
Management Appeal Board ("MAB") within ten (10) days of receipt of a request by
either PARTY to set up an MAB. The MAB shall consist of two (2) members of each
respective PARTY's management. The President of OLIN shall appoint two members
to represent OLIN and the President of PRIMEX shall appoint two members to
represent PRIMEX. The sole purpose of MAB shall be to resolve any dispute over
which the Representatives failed to resolve. The MAB members shall be persons
other than the Representatives. The MAB shall meet at East Alton, Illinois or
otherwise confer to resolve the dispute by good faith negotiations, which may
include presentations by the Representatives or others.
13.2 ARBITRATION
In the event the parties are unable to resolve their disputes after availing
themselves of the processes set forth in Section 13.1 above for a period of
ninety (90) days, such disputes, shall be solely and finally settled by three
arbitrators in accordance with the Commercial Arbitration Rules of the AAA (the
"Arbitration Rules"). The PARTY electing arbitration shall so notify the other
PARTY in writing in accordance with the Arbitration Rules, and such notice shall
be accompanied by the name of the arbitrator selected by the PARTY serving the
notice. The second arbitrator shall be chosen by the other PARTY, and a neutral
arbitrator shall be chosen by the two arbitrators so selected. If a PARTY fails
to select an arbitrator or to advise the other PARTY of its selection within
thirty (30) days after receipt by such a PARTY of the notice of the intent to
arbitrate, the second arbitrator shall be selected by the AAA. If the third
arbitrator shall not have been selected within thirty (30) days after the
selection of the second arbitrator, the appointment shall be made by the AAA.
All such proceedings shall be conducted in New York, New York. The arbitrator
shall make detailed findings of fact and law in writing in support of the
decision of the arbitrator panel, and is empowered to award reimbursement of
attorneys' fees and other costs of arbitration to the prevailing PARTY, in such
manner as the arbitrator panel shall deem appropriate. The provisions of this
Section 13.2 shall not be deemed to preclude any PARTY hereto from seeking
preliminary injunctive relief to protect or enforce its rights hereunder, or to
prohibit any court from making preliminary findings of fact in connection with
granting or denying such preliminary injunctive relief, or to preclude any PARTY
hereto from seeking permanent injunctive or other equitable relief after and in
accordance with the decision of the arbitrator panel. Whether any claim or
controversy is arbitrable or litigable shall be determined solely by the
arbitrator panel pursuant to the provisions of this Section 13.2. Any monetary
award of the arbitrators panel shall include interest from the date of any
breach or any violation of this Agreement. The arbitrators shall fix an
appropriate rate of interest from the date of the breach or other violation to
the date when the award is paid in full. The parties agree that judgment on the
arbitration award may be entered in any court having jurisdiction over the
parties or their assets.
13.3 CONTINUING OBLIGATIONS
It is expressly agreed that the failure of the parties to resolve a dispute on
any issue to be resolved hereunder shall not relieve either PARTY from any
obligation set forth in this Agreement. In addition, notwithstanding the
pendency of any such dispute, neither PARTY will be excused of its obligations
hereunder to cooperate with the other to effectuate the purposes of this
Agreement.
13.4 COUNTERPARTS
This Agreement may be executed in any number of counterparts, each of
which shall be deemed an original, but all of this shall constitute one and
the same instrument.
IN WITNESS WHEREOF the PARTIES hereto have caused this AGREEMENT to be executed
in duplicate as of the date first written above.
OLIN CORPORATION Primex Technologies, Inc.
By: Johnnie M. Jackson, Jr. By: George H. Pain
- --------------------------- ---------------------------
Johnnie M. Jackson, Jr. George H. Pain
Vice President, General Counsel Vice President
and Secretary
Exhibit 10.9: Form of Executive Agreement
[PRIMEX TIER I AGREEMENT]
EXECUTIVE AGREEMENT
Agreement between Primex Technologies, Inc., a Virginia corporation
("Primex"), and [ ] (the "Executive"), dated as of January 1, 1997.
Primex and the Executive agree as follows:
1. Definitions
As used in this Agreement:
(a) "Cause" means the willful and continued failure of the Executive
to substantially perform his or her duties; the willful engaging by the
Executive in gross misconduct significantly and demonstrably injurious to
Primex; or conduct by the Executive in the course of his or her employment which
is a felony or fraud. No act or failure to act on the part of the Executive
will be considered "willful" unless done or omitted not in good faith and
without reasonable belief that the action or omission was in the interests of
Primex or not opposed to the interests of Primex.
(b) "Change in Control" means:
(i) Primex ceases to be, directly or indirectly, owned by at
least 1,000 stockholders;
(ii) A person, partnership, joint venture, corporation or other
entity, or two or more of any of the foregoing acting as a "person" within the
meaning of Section 13(d)(3) of the Securities Exchange Act of 1934, as amended
(the "Act"), other than Primex, a majority-owned subsidiary of Primex or an
employee benefit plan (or related trust) of Primex, such subsidiary or Olin
Corporation, a Virginia corporation ("Olin"), become(s) the "beneficial owner"
(as defined in Rule 13d-3 under such Act) of 15% or more of the then outstanding
voting stock of Primex;
(iii) During any period of two consecutive years, individuals
who at the beginning of such period constitute Primex's Board of Directors
(together with any new Director whose election by Primex's Board of Directors or
whose nomination for election by Primex's stockholders was approved by a vote of
at least two-thirds of the Directors then still in office who either were
directors at the beginning of such period or whose election or nomination for
election was previously so approved) cease for any reason to constitute a
majority of the directors then in office; or
(iv) All or substantially all of the business of Primex is
disposed of pursuant to a merger, consolidation or other transaction in which
Primex is not the surviving corporation or Primex combines with another company
and is the surviving corporation (unless the shareholders of Primex immediately
following such merger, consolidation, combination, or other transaction
beneficially own, directly or indirectly, more than 50% of the voting stock or
other ownership interests of (x) the entity or entities, if any, that succeed to
the business of Primex or (y) the combined company).
(c) "Disability" means that the Executive has suffered an incapacity
due to physical or mental illness which meets the criteria for disability
established at the time under Primex's short-term disability plan.
(d) "Executive Severance" means:
(i) twelve months of the Executive's then current monthly
salary (without taking into account any reductions which may have occurred at or
after the date of a Change in Control); plus
(ii) an amount equal to the greater of the Executive's average
annual award actually paid under Primex's short-term annual incentive
compensation plans or programs ("ICP") for the three years (or for such fewer
years as the ICP may have been in effect) immediately preceding the date of
Termination or the Executive's then current ICP standard annual award.
(iii) The Executive will not be entitled to receive any other
severance otherwise payable to the Executive under any other severance plan of
Primex.
(iv) If on the Termination date the Executive is eligible and
is receiving payments under any then existing Primex disability plan, then the
Executive agrees that all such payments may, and will be, suspended and offset
for 12 months following the Termination date. If after such period the
Executive remains eligible to receive disability payments, then such payments
shall resume in the amounts and in accordance with the provisions of the
applicable Primex disability plan.
(e) "Potential Change in Control" means:
(i) Primex has entered into an agreement the consummation of
which would result in a Change in Control;
(ii) any person (including Primex ) publicly announces an
intention to take or to consider taking actions which if consummated would
constitute a Change in Control;
(iii) Primex learns that any person (other than an employee
benefit plan (or related trust) of Primex, a subsidiary of Primex or Olin) has
become the beneficial owner directly or indirectly of securities of Primex
representing 9.5% or more of the combined voting power of Primex's then
outstanding securities ordinarily entitled to vote in elections of directors; or
(iv) the Board of Directors of Primex adopts a resolution to
the effect that, for purposes of this Agreement, a Potential Change in Control
of Primex has occurred.
(f) "Termination" means:
(i) The Executive is discharged by Primex other than for
Cause;
(ii) The Executive terminates his or her employment in the
event that:
(1) Primex requires the Executive to relocate the
Executive's then office to an area which is not within reasonable commuting
distance, on a daily basis, from the Executive's then residence, except that a
requirement to relocate the Executive's office to Primex's corporate
headquarters is not a basis for Termination;
(2) Primex reduces the Executive's base salary or fails to
increase the Executive's base salary on a basis consistent (as to frequency and
amount) with Primex's exempt salary system as then in effect or, in the event of
a Change in Control, as in effect immediately prior to the Change in Control;
(3) Primex fails to continue the Executive's participation
in its benefit plans (including incentive compensation and stock based
incentives) on substantially the same basis, both in terms of the amount of the
benefits provided (other than due to Primex's or a relevant operation's earnings
performance) and the level of the Executive's participation relative to other
participants as exists on the date hereof; provided that, with respect to annual
and long term incentive compensation plans, the basis with which the amount of
benefits and level of participation of the Executive shall be compared shall be
the average benefit awarded to the Executive under the relevant plan during the
three years (or such fewer years as such plans may have been in effect)
immediately preceding the date of Termination;
(4) The Executive suffers a Disability which prevents the
Executive from performing the Executive's duties with Primex for a period of at
least 180 consecutive days;
(5) Following a Change in Control, Primex fails to
substantially maintain its benefit plans as in effect at the time of the Change
in Control, unless reasonably equivalent arrangements (embodied in an ongoing
substitute or alternative plan) have been made with respect to such plans; or
(6) The Executive's duties, position or reporting
responsibilities are diminished.
2. Term/Executive's Duties.
(a) This Agreement expires at the close of business on December 31,
2001, unless prior to that date there is a Change in Control, in which case this
Agreement will expire on the later of the close of business on December 31, 2001
or three years following the date of the Change in Control; provided that the
expiration of this Agreement will not affect any of the Executive's rights
resulting from a Termination prior to such expiration. In the event of the
Executive's death while employed by Primex, this Agreement shall terminate and
be of no further force or effect on the date of his or her death; provided that
the Executive's death will not affect any of the Executive's rights resulting
from a Termination prior to death.
(b) During the period of the Executive's employment by Primex, the
Executive shall devote his or her full time efforts during normal business hours
to Primex's business and affairs, except during reasonable vacation periods and
periods of illness or incapacity. Nothing in this Agreement will preclude the
Executive from devoting reasonable periods required for service as a director or
a member of any organization involving no conflict of interest with Primex's
interest, provided that no additional position as director or member shall be
accepted by the Executive during the period of his employment with Primex
without its prior consent.
(c) The Executive agrees that in the event of a Potential Change in
Control of Primex occurring after the date hereof, the Executive will remain in
the employ of Primex for a period of six months from the occurrence of such
Potential Change in Control, during which period the Executive will have an
office, title, duties and responsibilities substantially consistent with those
applicable immediately prior to the Potential Change in Control.
3. Executive Severance Payment
(a) In the event of a Termination occurring before the expiration of
this Agreement, Primex will pay the Executive a lump sum in an amount equal to
the Executive Severance. The payment will be made within 30 days of the
Termination.
(b) In the event of a Termination after a Change in Control has
occurred, in addition to the Executive Severance paid under Paragraph 3(a)
above, Primex will pay a Change in Control severance premium to the Executive in
an amount equal to [one] [FN/1: Two times in case of Chairman and CEO and Vice
Chairman.] times the Executive Severance. The Change in Control severance
premium, if it becomes due, will be made within 30 days of the Termination.
(c) The amount due under paragraph 3(a) or 3(b) will be reduced to
the extent that, if the amounts were paid in monthly installments, no
installment would be paid after the Executive's seventieth birthday.
(d) The Executive will not be required to mitigate the amount of any
payment provided for in paragraph 3(a) or 3(b) by seeking other employment or
otherwise, nor shall any compensation received by the Executive from a third
party reduce such payment. Except as may otherwise be expressly provided
herein, nothing in this Agreement will be deemed to reduce or limit the rights
which the Executive may have under any employee benefit plan, policy or
arrangement of Primex.
4. Other Benefits and Payments
(a) (1) If the Executive becomes entitled to payment under Paragraph
3(a), then the Executive shall be entitled to receive a lump sum payment from
Primex at the same time as the payment under Paragraph 3(a) is made equal to the
amount contributed or credited by Primex to the Executive's accounts in all
defined contribution plans of Primex (whether or not "qualified" plans) during
the 12 months preceding the Executive's Termination provided that in the event
there are fewer than 12 months in such period the payment required shall be
increased proportionately to make it equivalent to a 12 month period. The
"amount contributed or credited by Primex" as defined in this Paragraph 4 shall
not include any employee contributions, employer matching contributions,
dividends or investment gains or losses credited to the Executive's accounts,
but only the Primex contributions made or, in the case of supplementary plans,
credited, to the accounts. Such payment shall be in lieu of any such
contributions or credits by Primex to its defined contribution plans with
respect to the period after the Executive's Termination. If Primex is required
by law to contribute to such plans with respect to the period after the
Executive's Termination, any such contribution shall reduce the payout otherwise
due Executive under this Paragraph 4(a)(1). In the event the Executive receives
a payment under Paragraph 3(b), the amount required to be paid under the
preceding sentences of this Paragraph 4(a)(1) shall be [doubled] [FN/2:
Tripled in case of Chairman and CEO and Vice Chairman.] Notwithstanding the
foregoing, in the event at the date of Termination the Executive is more than 69
years old (or more than 68 [FN/3: 67 in case of Chairman and CEO and Vice
Chairman] years old in the case the Executive receives a payment under Paragraph
3(b)) the lump sum payment required to be made under this Paragraph 4(a)(1)
shall be reduced such that if it were expressed as equal monthly payments made
over a 12-month period (a [24-month] [FN/4: 36-month in case of Chairman and
CEO and Vice Chairman] period in the case of the Executive receiving a payment
under Paragraph 3(b)) and paid in monthly installments on the first of every
month following Termination no such monthly payments would be received by the
Executive beyond his or her seventieth birthday.
(2) If the Executive becomes entitled to payment under Paragraph
3(a), for the 12 months from the date of the Termination the Executive will
continue to enjoy coverage under all Primex medical, dental, and life insurance
plans to the extent the Executive was enjoying such coverage immediately prior
to the Termination. The Executive shall accrue no vacation during the 12 months
following the date of Termination but shall be entitled to payment for accrued
and unused vacation for the then current year. If the Executive receives the
Executive Severance (including the amount referred to in Paragraph 1(d)(ii)),
the Executive shall not be entitled to an ICP award for the calendar year of
Termination if Termination occurs during the first calendar quarter. Even if
the Executive receives the Executive Severance (including the amount referred to
in Paragraph 1(d)(ii)), if Termination occurs during or after the second
calendar quarter, the Executive shall also be entitled to a prorated ICP award
for the calendar year of Termination which shall be determined by multiplying
his or her then current ICP standard by a fraction the numerator of which is the
number of weeks in the calendar year prior to the Termination and the
denominator of which is 52. The Executive shall accrue no ICP award during the
12 months following the date of Termination.
(b) If the Executive receives payment under Paragraph 3(b), the
insurance coverage provided for in Paragraph 4(a) (2) will be for an additional
[12-month] [FN/6: 24-month in case of Chairman and CEO and Vice Chairman]
period.
(c) Notwithstanding the foregoing Paragraphs 4(a)(2), and (b), no
such insurance coverage will be afforded by this Agreement with respect to any
period after the Executive's seventieth birthday.
(d) In the event of a Termination, the Executive will be entitled at
Primex's expense to outplacement counseling and associated services in
accordance with Primex's customary practice at the time (or, if a Change in
Control shall have occurred, in accordance with such practice immediately prior
thereto) with respect to its senior executives who have been terminated other
than for cause. It is understood that the counseling and services contemplated
by this Paragraph 4(d) are intended to facilitate the obtaining by the Executive
of other employment following a Termination, and payments or benefits by Primex
in lieu thereof will not be available to the Executive.
(e) If the Executive (i) receives the payment under Paragraph 3(b),
(ii) has an accrued vested benefit under Olin's qualified pension plan as of the
date of Termination and (iii) at age 55, would NOT qualify for subsidized early
retirement from Olin under the provisions of Olin's pension plans, then,
concurrent with the payment made to the Executive under Paragraph 3(b), the
Executive will receive a lump sum payment from Primex to make up for the lost
subsidy calculated as follows:
FIRST, by calculating the annual benefit which would otherwise be
payable to the Executive at age 65 under all Olin pension plans assuming the
Executive had terminated his or her employment with Primex on the date of the
Change in Control, SECOND, by multiplying such annual benefit by the percentage
then applicable in the calculation of benefits paid to employees retiring from
active service with Olin at age 55 under the early retirement provisions of the
Olin Employees Pension Plan (72% at the date hereof), THIRD, by determining the
lump sum actuarial value (as of the date of Termination) of annual payments
beginning at age 55 as calculated in the SECOND step and FOURTH, by deducting
from such lump sum actuarial value the lump sum actuarial value (as of the date
of Termination) of the Executive's accrued annual benefits under all Olin
pension plans. Lump sum actuarial value shall be determined in accordance with
Olin's actuarial assumptions for its nonqualified defined benefit plans.
5. Participation in Change in Control/Section 4999 of Internal Revenue
Code
(a) In the event that the Executive participates or agrees to
participate by loan or equity investment (other than through ownership of less
than 1% of publicly traded securities of another company) in a transaction
("acquisition") which would result in an event described in paragraph 1(b)(i) or
(ii), the Executive must promptly disclose such participation or agreement to
Primex. If the Executive so participates or agrees to participate, no payments
due under this Agreement or by virtue of any Change in Control provisions
contained in any compensation or benefit plan of Primex will be paid to the
Executive until the acquiring group in which the Executive participates or
agrees to participate has completed the acquisition. In the event the Executive
so participates or agrees to participate and fails to disclose his or her
participation or agreement, the Executive will not be entitled to any payments
under this Agreement or by virtue of Change in Control provisions in any Primex
compensation or benefit plan, notwithstanding any of the terms hereof or
thereof.
(b) Any payments made pursuant to this Agreement or by virtue of
Change in Control provisions in any Primex compensation or benefit plan which
are subject to tax under Section 4999 of the Internal Revenue Code or a
successor provision ("4999") will be increased so that after paying the tax
imposed by 4999 and the income tax on the amount of the increase provided by
this paragraph (b), the Executive will have received a net payment equal to that
which he or she would have received if 4999 did not apply.
6. Successors; Binding Agreement
(a) Primex will require any successor (whether direct or indirect, by
purchase, merger, consolidation or otherwise) to all or substantially all of the
business or assets of Primex, by agreement, in form and substance satisfactory
to the Executive, expressly to assume and agree to perform this Agreement in the
same manner and to the same extent that Primex would be required to perform if
no such succession had taken place. Failure of Primex to obtain such assumption
and agreement prior to the effectiveness of any such succession will be a breach
of this Agreement and entitle the Executive to compensation from Primex in the
same amount and on the same terms as the Executive would be entitled to
hereunder had a Termination occurred on the succession date. As used in this
Agreement, "Primex" means Primex as defined in the preamble to this Agreement
and any successor to its business or assets which executes and delivers the
agreement provided for in this Paragraph 6 or which otherwise becomes bound by
all the terms and provisions of this Agreement by operation of law or otherwise.
(b) This Agreement shall be enforceable by the Executive's personal
or legal representatives, executors, administrators, successors, heirs,
distributees, devisees and legatees.
7. Notices. For the purpose of this Agreement, notices and all other
communications provided for herein shall be in writing and shall be deemed to
have been duly given when delivered or mailed by United States registered or
certified mail, return receipt requested, postage prepaid, addressed as follows:
If to the Executive:
If to the Company: Primex Technologies, Inc.
10101 9th Street North
St. Petersburg, FL 33716-3807
Attention: Corporate Secretary
or to such other address as either party may have furnished to the other in
writing in accordance herewith, except that notices of change of address shall
be effective only upon receipt.
8. Governing Law. The validity, interpretation, construction and
performance of this Agreement shall be governed by the laws of the State of
Florida.
9. Miscellaneous. No provisions of this Agreement may be modified,
waived or discharged unless such modification, waiver or discharge is agreed to
in writing signed by the Executive and Primex. No waiver by either party hereto
at any time of any breach by the other party hereto of, or compliance with, any
condition or provision of this Agreement to be performed by such other party
shall be deemed a waiver of similar or dissimilar provisions or conditions at
the same or at any prior or subsequent time. No agreements or representations,
oral or otherwise, express or implied, with respect to the subject matter hereof
have been made by either party which are not set forth expressly in this
Agreement.
10. Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original but all of which
together will constitute one and the same Agreement.
11. Withholding of Taxes. Primex may withhold from any benefits payable
under this Agreement all federal, state, city or other taxes as shall be
required pursuant to any law or governmental regulation or ruling.
12. Non-assignability. This Agreement is personal in nature and neither
of the parties hereto shall, without the consent of the other, assign or
transfer this Agreement or any rights or obligations hereunder, except as
provided in paragraph 6 above. Without limiting the foregoing, the Executive's
right to receive payments hereunder shall not be assignable or transferable,
whether by pledge, creation of a security interest or otherwise, other than a
transfer by his or her will or by the laws of descent or distribution, and, in
the event of any attempted assignment or transfer by the Executive contrary to
this Paragraph, Primex shall have no liability to pay any amount so attempted to
be assigned or transferred.
13. No Employment Right. This Agreement shall not be deemed to confer on
the Executive a right to continued employment with Primex.
14. Disputes/Arbitration.
(a) Any dispute or controversy arising under or in connection with
this Agreement shall be settled exclusively by arbitration at Primex's corporate
headquarters in accordance with the rules of the American Arbitration
Association then in effect. Judgment may be entered on the arbitrator's award
in any court having jurisdiction; provided, however, that the Executive shall be
entitled to seek specific performance of the Executive's right to be paid during
the pendency of any dispute or controversy arising under or in connection with
this Agreement.
(b) Primex shall pay all reasonable legal fees and expenses which the
Executive may incur to enforce this Agreement unless the Executive had no
reasonable basis for his or her claim. Should Primex dispute the entitlement of
the Executive to such fees and expenses, the burden of proof shall be on Olin to
establish that the Executive had no reasonable basis for his or her claim.
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed and delivered as of the day and year first above set forth.
PRIMEX TECHNOLOGIES, INC.
By: ____________________________
Title:
_________________________
Executive
EXHIBIT 10.10
$160,000,000
CREDIT AGREEMENT
dated as of
December 23, 1996
among
OLIN CORPORATION,
PRIMEX TECHNOLOGIES, INC.
The Banks Parties Hereto
and
Morgan Guaranty Trust Company of New York,
as Agent
TABLE OF CONTENTS
Page
ARTICLE 1
DEFINITIONS 1
SECTION 1.1 Definitions 1
SECTION 1.2 Accounting Terms and Determinations 18
SECTION 1.3 Computation of Time Periods 18
SECTION 1.4 Types of Borrowings 18
ARTICLE 2
THE CREDITS 19
SECTION 2.1 Commitments to Lend 19
SECTION 2.2 Notice of Committed Borrowing 19
SECTION 2.3 Money Market Borrowings 20
SECTION 2.4 Notice to Banks; Funding of Loans 23
SECTION 2.5 Notes 24
SECTION 2.6 Maturity of Loans 25
SECTION 2.7 Interest Rates 25
SECTION 2.8 Fees 28
SECTION 2.9. Reduction and Extension of the
Commitments/Substitution of Banks 28
SECTION 2.10 Method of Electing Interest Rates 29
SECTION 2.11 Scheduled Termination of Commitments 31
SECTION 2.12 Optional Prepayments 31
SECTION 2.13 General Provisions as to Payments 32
SECTION 2.14 Funding Losses 32
SECTION 2.15 Computation of Interest and Fees 33
SECTION 2.16 Regulation D Compensation 33
ARTICLE 3
LETTERS OF CREDIT 33
SECTION 3.1 L/C Commitment 33
SECTION 3.2 Procedure for Issuance of Letter of
Credit 34
SECTION 3.3 Fees, Commissions and Other Charges 34
SECTION 3.4 L/C Participations 35
SECTION 3.5 Reimbursement Obligation of the
Borrower 36
SECTION 3.6 Obligations Absolute 36
SECTION 3.7 Letter of Credit Payments 37
SECTION 3.8 Applications 37
ARTICLE 4
CONDITIONS OF EXTENSIONS OF CREDIT 37
SECTION 4.1 Condition Precedent to Initial
Extension of Credit 37
SECTION 4.2 Conditions Precedent to Each
Extension of Credit. 39
ARTICLE 5
REPRESENTATIONS AND WARRANTIES 39
SECTION 5.1 Representations and Warranties of the
Borrower 39
SECTION 5.2 Representations and Warranties of Olin 43
SECTION 5.3 Representations on Spinoff Date 43
ARTICLE 6
COVENANTS OF THE BORROWER 43
SECTION 6.1 Affirmative Covenants 43
SECTION 6.2 Negative Covenants 47
SECTION 6.3 Olin Affirmative and Negative Covenants 51
ARTICLE 7
EVENTS OF DEFAULT 52
SECTION 7.1 Events of Default 52
ARTICLE 8
THE AGENT 54
SECTION 8.1 Appointment and Authorization 54
SECTION 8.2 Agent and Affiliates 54
SECTION 8.3 Action by Agent 54
SECTION 8.4 Consultation with Experts 55
SECTION 8.5 Liability of Agent 55
SECTION 8.6 Indemnification 55
SECTION 8.7 Credit Decision 55
SECTION 8.8 Successor Agent 56
SECTION 8.9 Agent's Fee 56
ARTICLE 9
CHANGE IN CIRCUMSTANCES 56
SECTION 9.1 Basis for Determining Interest Rate
Inadequate or Unfair 56
SECTION 9.2 Illegality 57
SECTION 9.3 Increased Cost and Reduced Return 57
SECTION 9.4 Taxes 59
SECTION 9.5 Base Rate Loans Substituted for
Affected Fixed Rate Loans 61
ARTICLE 10
MISCELLANEOUS 61
SECTION 10.1 Notices 61
SECTION 10.2 No Waivers 62
SECTION 10.3 Expenses; Indemnification 62
SECTION 10.4 Sharing of Set-Offs 62
SECTION 10.5 Amendments and Waivers 63
SECTION 10.6 Successors and Assigns 63
SECTION 10.7 Information 65
SECTION 10.8 Assignment to Primex; Release 65
SECTION 10.9 Collateral 66
SECTION 10.10 Governing Law; Submission to
Jurisdiction 66
SECTION 10.11 Counterparts; Integration;
Effectiveness 66
SECTION 10.12 WAIVER OF JURY TRIAL 66
EXHIBIT A - Note
EXHIBIT B - Money Market Quote Request
EXHIBIT C - Invitation for Money Market Quotes
EXHIBIT D - Money Market Quote
EXHIBIT E - Opinion of Counsel for the Borrower
EXHIBIT F - Assignment and Assumption Agreement
EXHIBIT G - Incorporated Provisions of Olin Credit Agreement
SCHEDULES
PRICING SCHEDULE
Schedule 6.2(a) - Existing Liens
[THE EXHIBITS TO THIS CREDIT AGREEMENT HAVE BEEN OMITTED PURSUANT TO
ITEM 601(B)(2) OF REGULATION S-K. THE REGISTRANT HEREBY AGREES TO FURNISH
SUPPLEMENTALLY A COPY OF ANY OMITTED SCHEDULE OR EXHIBIT TO THE COMMISSION
UPON REQUEST.]
CREDIT AGREEMENT
CREDIT AGREEMENT, dated as of December 23, 1996, among OLIN
CORPORATION, a Virginia corporation ("Olin"), PRIMEX TECHNOLOGIES, INC., a
Virginia corporation ("Primex"), the Banks from time to time parties hereto and
MORGAN GUARANTY TRUST COMPANY OF NEW YORK, as Agent.
W I T N E S S E T H:
WHEREAS, on the date hereof Primex is a Wholly Owned Subsidiary of
Olin;
WHEREAS, pursuant to the Spinoff (as hereinafter defined) Olin will
distribute the shares of common stock of Primex to the shareholders of Olin, as
a result of which Primex will become a separate, publicly-held corporation;
WHEREAS, on December 27, 1996, Olin, as the Borrower, will borrow
Loans hereunder; and
WHEREAS, prior to the Spinoff, (i) Primex will become the Borrower
hereunder, (ii) Olin will assign to Primex, and Primex will assume, all rights
and obligations of Olin hereunder and under the Notes and (iii) Olin will be
released from its obligations hereunder and under the Notes;
NOW, THEREFORE, in consideration of the premises and the mutual
agreements herein set forth, the parties hereto agree as follows:
ARTICLE 1
DEFINITIONS
SECTION 1.1 Definitions. The following terms, as used herein, have the
following meanings:
"Absolute Rate Auction" means a solicitation of Money Market Quotes
setting forth Money Market Absolute Rates pursuant to Section 2.3.
"Adjusted CD Rate" has the meaning set forth in Section 2.7(b).
"Administrative Questionnaire" means, with respect to each Bank, an
administrative questionnaire in the form prepared by the Agent and submitted to
the Agent (with a copy to the Borrower) duly completed by such Bank.
"Affiliate" means (i) any Person that directly, or indirectly through
one or more intermediaries, controls the Borrower (a "Controlling Person") or
(ii) any Person (other than the Borrower or a Subsidiary) which is controlled by
or is under common control with a Controlling Person. As used herein, the term
"control" means possession, directly or indirectly, of the power to direct or
cause the direction of the management or policies of a Person, whether through
the ownership of voting securities, by contract or otherwise.
"Agent" means Morgan Guaranty Trust Company of New York in its
capacity as agent for the Banks hereunder, and its successors in such capacity.
"Applicable Lending Office" means, with respect to any Bank, (i) in
the case of its Domestic Loans, its Domestic Lending Office, (ii) in the case of
its Euro-Dollar Loans, its Euro-Dollar Lending Office and (iii) in the case of
its Money Market Loans, its Money Market Lending Office.
"Application" means an application, in such form as the Issuing Bank
may reasonably specify from time to time, requesting the Issuing Bank to issue a
Letter of Credit.
"Assessment Rate" has the meaning set forth in Section 2.7(b).
"Assignee" has the meaning set forth in Section 10.6(c).
"Assuming Bank" has the meaning specified in Section 2.9(c).
"Bank" means each bank listed on the signature pages hereof, each
Assignee which becomes a Bank pursuant to Section 10.6(c), and their respective
successors.
"Base Rate" means, for any day, a rate per annum equal to the higher
of (i) the Prime Rate for such day and (ii) the sum of 1/2 of 1% plus the
Federal Funds Rate for such day.
"Base Rate Loan" means (i) a Committed Loan which bears interest at
the Base Rate pursuant to the applicable Notice of Committed Borrowing or Notice
of Interest Rate Election or the provisions of Article 9 or (ii) an overdue
amount which was a Base Rate Loan immediately before it became overdue.
"Benefit Arrangement" means at any time an employee benefit plan
within the meaning of Section 3(3) of ERISA which is not a Plan or a
Multiemployer Plan and which is maintained or otherwise contributed to by any
member of the ERISA Group.
"Borrower" means (a) prior to the Spinoff, Olin and (b) after the
Spinoff, Primex.
"Borrowing" has the meaning set forth in Section 1.4.
"CD Base Rate" has the meaning set forth in Section 2.7(b).
"CD Loan" means (i) a Committed Loan which bears interest at a CD Rate
pursuant to the applicable Notice of Committed Borrowing or Notice of Interest
Rate Election or (ii) an overdue amount which was a CD Loan immediately before
it became overdue.
"CD Margin" means a rate per annum determined in accordance with the
Pricing Schedule.
"CD Rate" means a rate of interest determined pursuant to Section
2.7(b) on the basis of an Adjusted CD Rate.
"CD Reference Banks" means Bank of New York, Wachovia Bank of Georgia,
N.A. and Morgan Guaranty Trust Company of New York.
"Change of Control Date" shall mean (A) the first day after the
Spinoff Date on which any Person, or group of related Persons, has beneficial
ownership of more than 50% of the outstanding Voting Stock of the Borrower or
(B) the date immediately following the first date on which the members of the
Board of Directors of the Borrower (the "Board") at the commencement of any
period of 730 consecutive days (together with any other Directors whose
appointment or election by the Board or whose nomination for election by the
stockholders of the Borrower was approved by a vote of at least a majority of
the Directors then in office who either were Directors at the beginning of such
period or whose appointment or election or nomination for election, was
previously so approved) shall cease to constitute a majority of the Board at the
end of such period; provided that a Change of Control Date shall not be deemed
to have occurred under clause (A) hereof if (x) the Borrower shall have merged
or disposed of a portion of its assets in compliance with the requirements of
subsection 6.2(c) hereof within 10 days after the acquisition of such beneficial
ownership shall have occurred and (y) no person or group of related persons
shall have beneficial ownership of more than 50% of the outstanding Voting Stock
of the Borrower after such merger or disposition.
"Closing Date" means the date on or after the Effective Date on which
the conditions precedent specified in Section 4.1 have been satisfied.
"Commercial Letter of Credit" has the meaning given such term in
Section 3.1(a).
"Commitment" means, (i) with respect to each Bank listed on the
signature pages hereof, the amount set forth opposite its name on the signature
pages hereof and (ii) with respect to each Assignee that becomes a Bank pursuant
to Section 10.6(c), the amount of the Commitment thereby assumed by it, in each
case as such amount may be increased or reduced from time to time pursuant to
Section 10.6(c) or reduced from time to time pursuant to Section 2.9.
"Commitment Percentage" means, as to any Bank, the percentage which
the amount of such Bank's Commitment constitutes of the aggregate amount of the
Commitments of all the Banks.
"Committed Loan" means a loan made by a Bank pursuant to Section 2.1;
provided that, if any such loan or loans (or portions thereof) are combined or
subdivided pursuant to a Notice of Interest Rate Election, the term "Committed
Loan" shall refer to the combined principal amount resulting from such
combination or to each of the separate principal amounts resulting from such
subdivision, as the case may be.
"Consolidated Debt" means, at any date, the Debt of the Borrower and
its Consolidated Subsidiaries, determined on a consolidated basis as of such
date.
"Consolidated EBIT" means, for any fiscal period, Consolidated Net
Income for such period plus, to the extent deducted in determining Consolidated
Net Income for such period, the aggregate amount of (i) Consolidated Interest
Expense and (ii) income tax expense.
"Consolidated EBITDA" means, for any fiscal period, Consolidated EBIT
for such period plus, to the extent deducted in determining Consolidated Net
Income for such period, the aggregate amount of depreciation, amortization and
other similar non-cash charges.
"Consolidated Interest Expense" means, for any fiscal period, the
interest expense of the Borrower and its Consolidated Subsidiaries determined on
a consolidated basis for such period; provided that for the 1997 fiscal year of
the Borrower, Consolidated Interest Expense shall be determined as follows: (i)
at the end of the first fiscal quarter of the 1997 fiscal year, the actual
interest expense of the Borrower and its Consolidated Subsidiaries for such
quarter shall be multiplied by 4, (ii) at the end of the second fiscal quarter
of the 1997 fiscal year, the actual interest expense of the Borrower and its
Consolidated Subsidiaries for the first two fiscal quarters of 1997 shall be
multiplied by 2, (iii) at the end of the third fiscal quarter of the 1997 fiscal
year, the actual interest expense of the Borrower at its Consolidated
Subsidiaries for the first three fiscal quarters of 1997 shall be multiplied by
4/3 and (iv) at the end of the fourth fiscal quarter of the 1997 fiscal year,
the actual interest expense of the Borrower and its Consolidated Subsidiaries
for the four fiscal quarters of the 1997 fiscal year shall be used..
"Consolidated Net Income (Loss)" means, for any fiscal period,
consolidated gross revenues of the Borrower and its Consolidated Subsidiaries
for such period, less all operating and non-operating expenses of the Borrower
and its Consolidated Subsidiaries for such period including charges of a proper
character (including current and deferred taxes on income, and current additions
to reserves), but not including in gross revenues any gains (net of expenses and
taxes applicable thereto) in excess of losses resulting from the sale,
conversion or other disposition of capital assets (i.e. assets other than
current assets and personal property disposed of in the ordinary course of
business), any gains resulting from the write-up of assets, all determined in
accordance with generally acceptable account principles, including the making of
appropriate deductions for minority interests (if any) in Subsidiaries, any
extraordinary items, and any non-recurring items recorded in 1996 prior to the
date of this Agreement.
"Consolidated Secured Debt" means all Debt of the Borrower and its
Consolidated Subsidiaries, on a consolidated basis, outstanding at the time of
any determination with respect thereto which is secured, directly or indirectly,
by any Lien upon any property or assets of the Borrower or any Subsidiary.
"Consolidated Subsidiary" means at any date any Subsidiary or other
entity the accounts of which would be consolidated with those of the Borrower in
its consolidated financial statements if such statements were prepared as of
such date.
"Consolidated Tangible Net Worth" means at any date the consolidated
stockholders' equity of the Borrower and its Consolidated Subsidiaries less
their consolidated Intangible Assets, all determined as of such date. For
purposes of this definition, "Intangible Assets" means the amount (to the extent
reflected in determining such consolidated stockholders' equity) of (i) all
write-ups (other than write-ups resulting from foreign currency translations and
write-ups of assets of a going concern business made within twelve months after
the acquisition of such business) subsequent to December 31, 1995 in the book
value of any asset owned by the Borrower or a Consolidated Subsidiary, (ii) all
investments in unconsolidated Subsidiaries and all equity investments in Persons
which are not Subsidiaries and (iii) all unamortized debt discount and expense,
unamortized deferred charges, goodwill, patents, trademarks, service marks,
trade names, anticipated future benefit (net) of tax loss carry-forwards,
copyrights, organization or developmental expenses and other intangible assets.
"Current Assets" means, on any date, all of the assets of the Borrower
and its Consolidated Subsidiaries which would, in accordance with GAAP, be
classified as current assets.
"Debt" of any Person means at any date, without duplication, (i) all
obligations of such Person for borrowed money, (ii) all obligations of such
Person evidenced by bonds, debentures, notes or other similar instruments, (iii)
all obligations of such Person to pay the deferred purchase price of property or
services, except trade accounts payable arising in the ordinary course of
business, (iv) all obligations of such Person as lessee which are capitalized in
accordance with generally accepted accounting principles, (v) all non-contingent
obligations of such Person to reimburse any bank or other Person in respect of
amounts paid under a letter of credit or similar instrument, (vi) all Debt
secured by a Lien on any asset of such Person, whether or not such Debt is
otherwise an obligation of such Person and (vii) all Debt of others Guaranteed
by such Person.
"Default" means any condition or event which constitutes an Event of
Default or which with the giving of notice or lapse of time or both would,
unless cured or waived, become an Event of Default.
"Domestic Business Day" means any day except a Saturday, Sunday or
other day on which commercial banks in New York City are authorized by law to
close.
"Domestic Lending Office" means, as to each Bank, its office located
at its address set forth in its Administrative Questionnaire (or identified in
its Administrative Questionnaire as its Domestic Lending Office) or such other
office as such Bank may hereafter designate as its Domestic Lending Office by
notice to the Borrower and the Agent; provided that any Bank may so designate
separate Domestic Lending Offices for its Base Rate Loans, on the one hand, and
its CD Loans, on the other hand, in which case all references herein to the
Domestic Lending Office of such Bank shall be deemed to refer to either or both
of such offices, as the context may require.
"Domestic Loans" means CD Loans or Base Rate Loans or both.
"Domestic Reserve Percentage" has the meaning set forth in Section
2.7(b).
"Domestic Subsidiary" shall mean any Subsidiary organized under the
laws of any State of the United States of America, substantially all of the
assets of which are located, and substantially all of the business of which is
conducted, in the United States of America.
"Effective Date" means the date this Agreement becomes effective in
accordance with Section 10.11.
"Eligible Assignee" means (i) a commercial bank organized under the
laws of the United States, or any State thereof, and having total assets in
excess of $1,000,000,000 and a combined capital and surplus of at least
$500,000,000; (ii) a savings and loan association or savings bank organized
under the laws of the United States, or any State thereof, having total assets
in excess of $500,000,000, and having shareholders equity in excess of
$100,000,000; (iii) a commercial bank organized under the laws of any other
country which is a member of the OECD, or a political subdivision of any such
country, and having total assets in excess of $1,000,000,000, provided that such
bank is acting through a branch or agency located in the United States; and (iv)
the central bank of any country which is a member of the OECD.
"Environmental Laws" means any and all federal, state, local and
foreign statutes, laws, judicial decisions, regulations, ordinances, rules,
judgments, orders, decrees, plans, injunctions, permits, concessions, grants,
franchises, licenses, agreements and other governmental restrictions relating to
the environment, the effect of the environment on human health or to emissions,
discharges or releases of pollutants, contaminants, Hazardous Substances or
wastes into the environment including, without limitation, ambient air, surface
water, ground water, or land, or otherwise relating to the manufacture,
processing, distribution, use, treatment, storage, disposal, transport or
handling of pollutants, contaminants, Hazardous Substances or wastes or the
clean-up or other remediation thereof.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and the regulations promulgated and rulings issued
thereunder.
"ERISA Affiliate" means any Person who, for purposes of Title IV of
ERISA, is a member of the Borrower's controlled group, or under common control
with the Borrower, within the meaning of Section 414 of the Internal Revenue
Code.
"ERISA Event" means (i) the occurrence of a reportable event with
respect to a Plan, within the meaning of Section 4043 of ERISA, unless the 30-
day notice requirement with respect thereto has been waived by the PBGC; (ii)
the provision by the administrator of any Plan of a notice of intent to
terminate such Plan, pursuant to Section 4041(a)(2) of ERISA (including any such
notice with respect to a plan amendment referred to in Section 4041(e) of
ERISA); (iii) the cessation of operations at a facility in the circumstances
described in Section 4062(e) of ERISA; (iv) the withdrawal by the Borrower or an
ERISA Affiliate from a Multiple Employer Plan during a plan year for which it
was a substantial employer, as defined in Section 4001(a)(2) of ERISA; (v) the
failure by the Borrower or any ERISA Affiliate to make a payment to a Plan
required under Section 302(f)(1) of ERISA, which Section imposes a lien for
failure to make required payments; (vi) the adoption of an amendment to a Plan
requiring the provision of security to such Plan, pursuant to Section 307 of
ERISA; (vii) the receipt of notice from or the institution by the PBGC of
proceedings to terminate a Plan or to appoint a trustee to administer a Plan,
pursuant to Section 4042 of ERISA, or the occurrence of any event or condition
which would constitute grounds under Section 4042 of ERISA for the termination
of, or the appointment of a trustee to administer, a Plan; (viii) the receipt by
the Borrower or any ERISA Affiliate of any notice or communication from the PBGC
concerning the Spinoff; (ix) any attempt by the Borrower or any ERISA Affiliate
to waive the minimum funding standard under Section 412 of the Internal Revenue
Code in respect of any Plan; (x) the failure of the Borrower or any ERISA
Affiliate to make any contribution or payment to any Plan or Multiemployer Plan
or in respect of any Benefit Arrangement, which has resulted or could reasonably
be expected to result in the imposition of a Lien or the posting of a bond or
other security under ERISA or the Internal Revenue Code; (xi) any attempt by the
Borrower or any ERISA Affiliate to amend any Plan or Multiemployer Plan or
Benefit Arrangement, which has resulted or could reasonably be expected to
result in the imposition of a Lien or the posting of a bond or other security
under ERISA or the Internal Revenue Code; (xii) the incurrence by the Borrower
or any ERISA Affiliate of any liability under Title IV of ERISA (other than a
liability to the PBGC for premiums under Section 4007 of ERISA); or (xiii) the
receipt by the Borrower or any ERISA Affiliate of any notice or communication
concerning complete or partial Withdrawal Liability of a Multiemployer Plan or
that any Multiemployer Plan is in reorganization, is insolvent or has been
terminated.
"Euro-Dollar Business Day" means any Domestic Business Day on which
commercial banks are open for international business (including dealings in
dollar deposits) in London.
"Euro-Dollar Lending Office" means, as to each Bank, its office,
branch or affiliate located at its address set forth in its Administrative
Questionnaire (or identified in its Administrative Questionnaire as its Euro-
Dollar Lending Office) or such other office, branch or affiliate of such Bank as
it may hereafter designate as its Euro-Dollar Lending Office by notice to the
Borrower and the Agent.
"Euro-Dollar Loan" means (i) a Committed Loan which bears interest at
a Euro-Dollar Rate pursuant to the applicable Notice of Committed Borrowing or
Notice of Interest Rate Election or (ii) an overdue amount which was a Euro-
Dollar Loan immediately before it became overdue.
"Euro-Dollar Margin" means a rate per annum determined in accordance
with the Pricing Schedule.
"Euro-Dollar Rate" means a rate of interest determined pursuant to
Section 2.7(c) on the basis of the London Interbank Offered Rate.
"Euro-Dollar Reference Banks" means the principal London offices of
Bank of New York, Wachovia Bank of Georgia, N.A. and Morgan Guaranty Trust
Company of New York.
"Euro-Dollar Reserve Percentage" means for any day that percentage
(expressed as a decimal) which is in effect on such day, as prescribed by the
Board of Governors of the Federal Reserve System (or any successor) for
determining the maximum reserve requirement for a member bank of the Federal
Reserve System in New York City with deposits exceeding five billion dollars in
respect of "Eurocurrency liabilities" (or in respect of any other category of
liabilities which includes deposits by reference to which the interest rate on
Euro-Dollar Loans is determined or any category of extensions of credit or other
assets which includes loans by a non-United States office of any Bank to United
States residents).
"Event of Default" has the meaning set forth in Section 7.1.
"Facility Fee Rate" means a rate per annum determined in accordance
with the Pricing Schedule.
"Federal Funds Rate" means, for any day, the rate per annum (rounded
upward, if necessary, to the nearest 1/100th of 1%) equal to the weighted
average of the rates on overnight Federal funds transactions with members of the
Federal Reserve System arranged by Federal funds brokers on such day, as
published by the Federal Reserve Bank of New York on the Domestic Business Day
next succeeding such day, provided that (i) if such day is not a Domestic
Business Day, the Federal Funds Rate for such day shall be such rate on such
transactions on the next preceding Domestic Business Day as so published on the
next succeeding Domestic Business Day, and (ii) if no such rate is so published
on such next succeeding Domestic Business Day, the Federal Funds Rate for such
day shall be the average rate quoted to Morgan Guaranty Trust Company of New
York on such day on such transactions as determined by the Agent.
"Fixed Rate Loans" means CD Loans or Euro-Dollar Loans or Money Market
Loans (excluding Money Market LIBOR Loans bearing interest at the Base Rate
pursuant to Section 9.1) or any combination of the foregoing.
"Foreign Subsidiary" shall mean any Subsidiary other than a Domestic
Subsidiary.
"GAAP" means generally accepted accounting principles in effect from
time to time in the United States.
"Guarantee" by any Person means any obligation, contingent or
otherwise, of such Person directly or indirectly guaranteeing any Debt of any
other Person and, without limiting the generality of the foregoing, any
obligation, direct or indirect, contingent or otherwise, of such Person (i) to
purchase or pay (or advance or supply funds for the purchase or payment of) such
Debt (whether arising by virtue of partnership arrangements, by agreement to
keep-well, to purchase assets, goods, securities or services, to take-or-pay, or
to maintain financial statement conditions or otherwise) or (ii) entered into
for the purpose of assuring in any other manner the holder of such Debt of the
payment thereof or to protect such holder against loss in respect thereof (in
whole or in part), provided that the term Guarantee shall not include
endorsements for collection or deposit in the ordinary course of business. The
term "Guarantee" used as a verb has a corresponding meaning.
"Group of Loans" means at any time a group of Loans consisting of (i)
all Committed Loans which are Base Rate Loans at such time, (ii) all Euro-Dollar
Loans having the same Interest Period at such time or (iii) all CD Loans having
the same Interest Period at such time, provided that, if a Committed Loan of any
particular Bank is converted to or made as a Base Rate Loan pursuant to Article
9, such Loan shall be included in the same Group or Groups of Loans from time to
time as it would have been in if it had not been so converted or made.
"Hazardous Substances" means any toxic, radioactive, caustic or
otherwise hazardous substance, including petroleum, its derivatives, by-products
and other hydrocarbons, or any substance having any constituent elements
displaying any of the foregoing characteristics, in each case regulated by an
Environmental Law.
"Indemnitee" has the meaning set forth in Section 10.3(b).
"Information Statement" means the Form 10 Information Statement of
Olin and Primex as sent to the shareholders of Olin in connection with the
Spinoff.
"Insufficiency" means, with respect to any Plan, the amount, if any,
of its unfunded benefit liabilities, as defined in Section 4001(a)(18) of ERISA,
as of the end of the Plan year immediately preceding the date on which a
representation or covenant is made, as applicable.
"Interest Period" means: (1) with respect to each Euro-Dollar Loan,
the period commencing on the date of borrowing specified in the applicable
Notice of Borrowing or on the date specified in the applicable Notice of
Interest Rate Election and ending one, two, three or six months thereafter, as
the Borrower may elect in the applicable notice; provided that:
(a) any Interest Period which would otherwise end on a day which is
not a Euro-Dollar Business Day shall be extended to the next succeeding
Euro-Dollar Business Day unless such Euro-Dollar Business Day falls in
another calendar month, in which case such Interest Period shall end on the
next preceding Euro-Dollar Business Day;
(b) any Interest Period which begins on the last Euro-Dollar Business
Day of a calendar month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such Interest Period)
shall, subject to clause (c) below, end on the last Euro-Dollar Business
Day of a calendar month; and
(c) any Interest Period which would otherwise end after the
Termination Date shall end on the Termination Date.
(2) with respect to each CD Loan, the period commencing on the date of
borrowing specified in the applicable Notice of Borrowing or on the date
specified in the applicable Notice of Interest Rate Election and ending 30, 60,
90 or 180 days thereafter, as the Borrower may elect in the applicable notice
provided that:
(a) any Interest Period (other than an Interest Period determined
pursuant to clause (b) below) which would otherwise end on a day which is not a
Euro-Dollar Business Day shall be extended to the next succeeding Euro-Dollar
Business Day; and
(b) any Interest Period which would otherwise end after the
Termination Date shall end on the Termination Date.
(3) with respect to each Money Market LIBOR Loan, the period
commencing on the date of borrowing specified in the applicable Notice of
Borrowing and ending such whole number of months thereafter as the Borrower may
elect in accordance with Section 2.3; provided that:
(a) any Interest Period which would otherwise end on a day which is
not a Euro-Dollar Business Day shall be extended to the next succeeding Euro-
Dollar Business Day unless such Euro-Dollar Business Day falls in another
calendar month, in which case such Interest Period shall end on the next
preceding Euro-Dollar Business Day;
(b) any Interest Period which begins on the last Euro-Dollar Business
Day of a calendar month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such Interest Period)
shall, subject to clause (c) below, end on the last Euro-Dollar Business Day of
a calendar month; and
(c) any Interest Period which would otherwise end after the
Termination Date shall end on the Termination Date.
(4) with respect to each Money Market Absolute Rate Loan, the period
commencing on the date of borrowing specified in the applicable Notice of
Borrowing and ending such number of days thereafter (but not less than seven
days) as the Borrower may elect in accordance with Section 2.3; provided that:
(a) any Interest Period which would otherwise end on a day which is
not a Euro-Dollar Business Day shall be extended to the next succeeding Euro-
Dollar Business Day; and
(b) any Interest Period which would otherwise end after the
Termination Date shall end on the Termination Date.
"Internal Revenue Code" means the Internal Revenue Code of 1986, as
amended, or any successor statute.
"Investment" means any investment in any Person, whether by means of
share purchase, capital contribution, loan, guarantee, time deposit or otherwise
(but not including any demand deposit).
"Issuing Bank" means Bank of New York, in its capacity as issuer of
any Letter of Credit and any other Bank designated as "Issuing Bank" hereunder
by the Borrower with the consent of the Agent and such Bank.
"L/C Fee Payment Date" means the last day of each March, June,
September and December including the Termination Date.
"L/C Commitment" means $30,000,000.
"L/C Obligations" means, at any time, an amount equal to the sum of
(a) the aggregate then undrawn and unexpired amount of the then outstanding
Letters of Credit and (b) the aggregate amount of drawings under Letters of
Credit which have not then been reimbursed pursuant to Section 3.5.
"L/C Participants" means, the collective reference to all the Banks
other than the Issuing Bank.
"Letters of Credit" has the meaning specified in Section 3.1(a).
"LIBOR Auction" means a solicitation of Money Market Quotes setting
forth Money Market Margins based on the London Interbank Offered Rate pursuant
to Section 2.3.
"Lien" means any mortgage, pledge, security interest, encumbrance,
lien or charge of any kind (including any conditional sale or other title
retention agreement).
"Loan" means a Domestic Loan, a Euro-Dollar Loan or a Money Market
Loan and "Loans" means Domestic Loans, Euro-Dollar Loans or Money Market Loans
or any combination of the foregoing.
"London Interbank Offered Rate" has the meaning set forth in Section
2.7(c).
"Material Adverse Effect" means a material adverse effect on the
property, financial condition or operations of the Borrower and its
Subsidiaries, taken as a whole, or on the ability of the Borrower to perform its
obligations under this Agreement and the Notes.
"Money Market Absolute Rate" has the meaning set forth in Section
2.3(d).
"Money Market Absolute Rate Loan" means a loan to be made by a Bank
pursuant to an Absolute Rate Auction.
"Money Market Lending Office" means, as to each Bank, its Domestic
Lending Office or such other office, branch or affiliate of such Bank as it may
hereafter designate as its Money Market Lending Office by notice to the Borrower
and the Agent; provided that any Bank may from time to time by notice to the
Borrower and the Agent designate separate Money Market Lending Offices for its
Money Market LIBOR Loans, on the one hand, and its Money Market Absolute Rate
Loans, on the other hand, in which case all references herein to the Money
Market Lending Office of such Bank shall be deemed to refer to either or both of
such offices, as the context may require.
"Money Market LIBOR Loan" means a loan to be made by a Bank pursuant
to a LIBOR Auction (including such a loan bearing interest at the Base Rate
pursuant to Section 9.1).
"Money Market Loan" means a Money Market LIBOR Loan or a Money Market
Absolute Rate Loan.
"Money Market Margin" has the meaning set forth in Section
2.3(d)(ii)(C).
"Money Market Quote" means an offer by a Bank to make a Money Market
Loan in accordance with Section 2.3.
"Morgan Letters" means the letters, dated October 18, 1996, between
Morgan Guaranty Trust Company of New York, J.P. Morgan Securities, Inc. and
Olin.
"Multiemployer Plan" means a multiemployer plan, as defined in Section
4001(a)(3) of ERISA, to which the Borrower or any ERISA Affiliate is making or
accruing an obligation to make contributions, or has within any of the preceding
five plan years made or accrued an obligation to make contributions, such plan
being maintained pursuant to one or more collective bargaining agreements.
"Multiple Employer Plan" means a single employer plan, as defined in
Section 4001(a)(15) of ERISA, which (i) is maintained for employees of the
Borrower or an ERISA Affiliate and at least one Person other than the Borrower
and its ERISA Affiliates or (ii) was so maintained and in respect of which the
Borrower or an ERISA Affiliate could have liability under Section 4064 or 4069
of ERISA in the event such plan has been or were to be terminated.
"Notes" means promissory notes of the Borrower, substantially in the
form of Exhibit A hereto, evidencing the obligation of the Borrower to repay the
Loans and "Note" means any one of such promissory notes issued hereunder.
"Notice of Borrowing" means a Notice of Committed Borrowing (as
defined in Section 2.2) or a Notice of Money Market Borrowing (as defined in
Section 2.3(f)).
"Notice of Interest Rate Election" has the meaning set forth in
Section 2.10.
"OECD" means the Organization for Economic Cooperation and
Development.
"Officer's Certificate" means a certificate signed in the name of the
Borrower by its President, one of its Vice Presidents, its Treasurer or its
Controller.
"Olin" has the meaning specified in the preamble to this Agreement.
"Olin Credit Agreement" means the Credit Agreement, dated September
30, 1993, among Olin, Bank of Boston Connecticut, Citibank, N.A., Credit Suisse,
Morgan Guaranty Trust Company of New York, The Boatmen's National Bank of St.
Louis and The Chase Manhattan Bank, as amended and in effect on the date hereof
after giving effect to all waivers prior to the date hereof.
"Parent" means, with respect to any Bank, any Person controlling such
Bank.
"Participant" has the meaning set forth in Section 10.6(b).
"PBGC" means the Pension Benefit Guaranty Corporation or any entity
succeeding to any or all of its functions under ERISA.
"Permitted Encumbrances" means:
(a) Liens imposed by law for taxes that are not yet due or are being
contested in compliance with Section 6.1(k);
(b) carriers', warehousemen's, mechanics', materialmen's, repairmen's
and other like Liens imposed by law, arising in the ordinary course of business
and securing obligations that are not overdue by more than 30 days or are being
contested in compliance with Section 6.1(k);
(c) pledges and deposits made in the ordinary course of business in
compliance with workers' compensation, unemployment insurance and other social
security laws or regulations;
(d) deposits to secure the performance of bids, trade contracts,
leases, statutory obligations, surety and appeal bonds, performance bonds and
other obligations of a like nature, in each case in the ordinary course of
business; and
(e) easements, zoning restrictions, rights-of-way and similar
encumbrances on real property imposed by law or arising in the ordinary course
of business that do not secure any monetary obligations and do not materially
detract from the value of the affected property or interfere with the ordinary
conduct of business of the Borrower or any Subsidiary;
provided that the term "Permitted Encumbrances" shall not include any Lien
securing Debt.
"Person" means an individual, a corporation, a limited liability
company, a partnership, an association, a trust or any other entity or
organization, including a government or political subdivision or an agency or
instrumentality thereof.
"Plan" means a Single Employer Plan or a Multiple Employer Plan.
"Pricing Schedule" means the Schedule attached hereto identified as
such.
"Prime Rate" means the rate of interest publicly announced by Morgan
Guaranty Trust Company of New York in New York City from time to time as its
Prime Rate.
"Primex" has the meaning specified in the preamble of this Agreement.
"Quarterly Date" means each March 31, June 30, September 30 and
December 31.
"Reference Banks" means the CD Reference Banks or the Euro-Dollar
Reference Banks, as the context may require, and "Reference Bank" means any one
of such Reference Banks.
"Reimbursement Obligation" means the obligation of the Borrower to
reimburse the Issuing Bank pursuant to Section 3.5 for amounts drawn under
Letters of Credit.
"Required Banks" means at any time Banks having at least 50.1% of the
aggregate amount of the Commitments or, if the Commitments shall have been
terminated, holding at least 50.1% of the aggregate unpaid principal amount of
the Loans and aggregate outstanding L/C Obligations.
"Restricted Payment" means (i) any dividend or other distribution on
any shares of the Borrower's capital stock (except dividends payable solely in
shares of its capital stock) or (ii) any payment on account of the purchase,
redemption, retirement or acquisition of (a) any shares of the Borrower's
capital stock or (b) any option, warrant or other right to acquire shares of the
Borrower's capital stock (but not including payments of principal, premium (if
any) or interest made pursuant to the terms of convertible debt securities prior
to conversion).
"Revolving Credit Period" means the period from and including the
Effective Date to but not including the Termination Date.
"SEC" means the Securities and Exchange Commission (or any successor).
"Significant Subsidiary" means each Subsidiary, but excludes any
Foreign Subsidiary the United States dollar value (or equivalent thereof) of
whose assets is less than 5% of the total assets of the Borrower and the
Subsidiaries, on a consolidated basis.
"Single-Employer Plan" means a single employer plan, as defined in
Section 4001(a)(15) of ERISA, which (i) is maintained for employees of the
Borrower or an ERISA Affiliate and no Person other than the Borrower and its
ERISA Affiliates or (ii) was so maintained and in respect of which the Borrower
or an ERISA Affiliate could have liability under Section 4069 of ERISA in the
event such plan has been or were to be terminated.
"Spinoff" means the distribution of shares of the common stock of
Primex as a dividend from Olin to its shareholders as described in the
Information Statement, such that Primex shall become a separate publicly-held
corporation.
"Spinoff Date" means the effective date of the Spinoff, such date
expected to be December 31, 1996.
"Standby Letter of Credit" has the meaning specified in Section
3.1(a).
"Subsidiary" means, as at any particular time, any Person included as
a consolidated subsidiary of the Borrower in the financial statements contained
in the most recent report filed by the Borrower with the SEC on Form 10 or Form
10-K pursuant to the Securities Exchange Act of 1934, provided that, under then
current regulations of the SEC, such Person may continue to be so included as a
consolidated subsidiary of the Borrower in any such annual report thereafter
filed by the Borrower with the SEC.
"Tax Exempt Financing" means a transaction with a governmental unit or
instrumentality which involves (i) the acquisition of air or water pollution
control or solid waste disposal or industrial development facilities for use at
or in connection with the Borrower's business or a plant or other industrial
facility owned or operated by the Borrower or a Subsidiary, (ii) the issuance by
such governmental unit or instrumentality to Persons other than the Borrower or
a Subsidiary of bonds or other obligations on which the interest is exempt from
Federal income taxes under Section 103(b) of the Internal Revenue Code as now in
effect (or under applicable provisions of any amended Internal Revenue Code) and
substantially all the proceeds of which are applied to finance or refinance the
cost of acquisition of such industrial development or air or water pollution
control or solid waste disposal facilities, and (iii) participation in the
transaction by the Borrower or a Subsidiary in any manner permitted by this
Agreement.
"Temporary Cash Investment" means any Investment in (i) direct
obligations of the United States or any agency thereof, or obligations
guaranteed by the United States or any agency thereof, (ii) commercial paper
rated at least A-1 by Standard & Poor's Ratings Services and P-1 by Moody's
Investors Service, Inc., (iii) time deposits with, including certificates of
deposit issued by, any office located in the United States of any bank or trust
company which is organized under the laws of the United States or any state
thereof and has capital, surplus and undivided profits aggregating at least
$1,000,000,000, (iv) repurchase agreements with respect to securities described
in clause (i) above entered into with an office of a bank or trust company
meeting the criteria specified in clause (iii) above or (v) shares of money
market mutual or similar funds which invest substantially all of their assets in
investments satisfying the requirements of clauses (i) through (iv) of this
definition, provided in the case of clauses (i) through (iv) that such
Investment matures within one year from the date of acquisition thereof by the
Borrower or a Subsidiary.
"Termination Date" means (i) December 31, 2001 or (ii) any date to
which the Termination Date shall have been extended pursuant to Section 2.9(b);
provided that in each case of (i) and (ii), the earlier date on which the
termination in whole of the Commitments occurs pursuant to Section 2.9(a) or
Article 7.
"Transition Agreement" means the Transition Services Agreement dated
as of December 31, 1996 between Primex and Olin.
"United States" means the United States.
"Uniform Customs" means the Uniform Customs and Practice for
Documentary Credits (1993 Revision), International Chamber of Commerce
Publication No. 500, as the same may be amended from time to time.
"Voting Rights" means, as to any corporation, ordinary voting power
(whether associated with outstanding common stock or outstanding preferred
stock, or both) to elect members of the Board of Directors of such corporation
(irrespective of whether or not at the time capital stock of any class or
classes of such corporation shall or might have voting power or additional
voting power upon the occurrence of any contingency).
"Voting Stock" shall mean stock of any class or classes (however
designated) having ordinary voting power for the election of a majority of the
directors of the Borrower other than stock having such power only by reason of a
contingency.
"Wholly Owned" means, with respect to any corporation, a corporation
of which 100% of the Voting Rights are at the time directly or indirectly owned
by the Borrower, by the Borrower and one or more other Wholly Owned
Subsidiaries, or by one or more other Wholly Owned Subsidiaries.
"Withdrawal Liability" shall have the meaning given such term under
Part 1 of Subtitle E of Title IV of ERISA.
SECTION 1.2 Accounting Terms and Determinations. Unless otherwise
specified herein, all accounting terms used herein shall be interpreted, all
accounting determinations hereunder shall be made, and all financial statements
required to be delivered hereunder shall be prepared in accordance with GAAP,
applied on a basis consistent (except for changes concurred in by the Borrower's
independent public accountants) with the most recent audited consolidated
financial statements of the Borrower and its Consolidated Subsidiaries delivered
to the Banks; provided that, if the Borrower notifies the Agent that the
Borrower wishes to amend any covenant in Article 6 to eliminate the effect of
any change in GAAP on the operation of such covenant (or if the Agent notifies
the Borrower that the Required Banks wish to amend Article 6 for such purpose),
then the Borrower's compliance with such covenant shall be determined on the
basis of GAAP in effect immediately before the relevant change in GAAP became
effective, until either such notice is withdrawn or such covenant is amended in
a manner satisfactory to the Borrower and the Required Banks.
SECTION 1.3 Computation of Time Periods. (a) In this Agreement and the
Notes in the computation of periods of time from a specified date to a later
specified date, the word "from" means "from and including" and the words "to"
and "until" each means "to but excluding".
(b) In this Agreement and the Notes each reference to a year shall be
a reference to the twelve consecutive months beginning January 1 in such year
and ending December 31 in such year and each reference to a quarter shall be a
reference to one of the three consecutive month periods beginning January 1,
April 1, July 1 or October 1, in each year.
SECTION 1.4 Types of Borrowings. The term "Borrowing" denotes the
aggregation of Loans of one or more Banks to be made to the Borrower pursuant to
Article 2 on the same date, all of which Loans are of the same type (subject to
Article 8) and, except in the case of Base Rate Loans, have the same initial
Interest Period. Borrowings are classified for purposes of this Agreement
either by reference to the pricing of Loans comprising such Borrowing (e.g., a
"Fixed Rate Borrowing" is a Euro-Dollar Borrowing, a CD Borrowing or a Money
Market Borrowing (excluding any such Borrowing consisting of Money Market LIBOR
Loans bearing interest at the Base Rate pursuant to Section 8.1), and a "Euro-
Dollar Borrowing" is a Borrowing comprised of Euro-Dollar Loans) or by reference
to the provisions of Article 2 under which participation therein is determined
(i.e., a "Committed Borrowing" is a Borrowing under Section 2.1 in which all
Banks participate in proportion to their Commitments, while a "Money Market
Borrowing" is a Borrowing under Section 2.3 in which the Bank participants are
determined on the basis of their bids in accordance therewith).
ARTICLE 2
THE CREDITS
SECTION 2.1 Commitments to Lend. During the Revolving Credit Period, each
Bank severally agrees, on the terms and conditions set forth in this Agreement,
to make loans to the Borrower pursuant to this Section from time to time in
amounts such that the aggregate principal amount of Committed Loans by such Bank
at any one time outstanding, plus such Bank's Commitment Percentage of the then
aggregate outstanding amount of L/C Obligations, shall not exceed the amount of
its Commitment; provided, that the aggregate outstanding principal amount of all
Loans, plus the aggregate outstanding amount of L/C Obligations, shall not at
any time exceed the aggregate amount of the Commitments. Each Borrowing under
this Section shall be in an aggregate principal amount of $5,000,000 or any
larger whole multiple of $1,000,000 and shall be made from the several Banks
ratably in proportion to their respective Commitments. Within the foregoing
limits, the Borrower may borrow under this Section, prepay Loans to the extent
permitted by Section 2.12 and reborrow at any time during the Revolving Credit
Period under this Section.
SECTION 2.2 Notice of Committed Borrowing. The Borrower shall give the
Agent notice (a "Notice of Committed Borrowing") not later than 11:00 A.M. (New
York City time) on (x) the date of each Base Rate Borrowing, (y) the second
Domestic Business Day before each CD Borrowing and (z) the third Euro-Dollar
Business Day before each Euro-Dollar Borrowing, specifying:
(i) the date of such Borrowing, which shall be a
Domestic Business Day in the case of a Domestic Borrowing or a Euro-Dollar
Business Day in the case of a Euro-Dollar Borrowing;
(ii) the aggregate amount of such Borrowing;
(iii) whether the Loans comprising such Borrowing are
to bear interest initially at the Base Rate, a CD Rate or a Euro-Dollar Rate;
and
(iv) in the case of a Fixed Rate Borrowing, the
duration of the initial Interest Period applicable thereto, subject to the
provisions of the definition of Interest Period.
SECTION 2.3 Money Market Borrowings. (a) The Money Market
Option. In addition to Committed Borrowings pursuant to Section 2.1, the
Borrower may, as set forth in this Section, request the Banks during the
Revolving Credit Period to make offers to make Money Market Loans to the
Borrower; provided, that the aggregate outstanding principal amount of
Loans, plus the aggregate outstanding amount of L/C Obligations, shall not
exceed at any time the aggregate amount of the Commitments. The Banks may,
but shall have no obligation to, make such offers and the Borrower may, but
shall have no obligation to, accept any such offers in the manner set forth
in this Section.
(b) Money Market Quote Request. When the Borrower wishes
to request offers to make Money Market Loans under this Section, it shall
transmit to the Agent by telex or facsimile transmission a Money Market Quote
Request substantially in the form of Exhibit B hereto so as to be received not
later than 10:30 A.M. (New York City time) on (x) the fifth Euro-Dollar Business
Day prior to the date of Borrowing proposed therein, in the case of a LIBOR
Auction or (y) the Domestic Business Day next preceding the date of Borrowing
proposed therein, in the case of an Absolute Rate Auction (or, in either case,
such other time or date as the Borrower and the Agent shall have mutually agreed
and shall have notified to the Banks not later than the date of the Money Market
Quote Request for the first LIBOR Auction or Absolute Rate Auction for which
such change is to be effective) specifying:
(i) the proposed date of Borrowing, which shall be
a Euro-Dollar Business Day in the case of a LIBOR Auction or a Domestic Business
Day in the case of an Absolute Rate Auction,
(ii) the aggregate amount of such Borrowing, which shall
be $5,000,000 or a larger whole multiple of $1,000,000,
(iii) the duration of the Interest Period applicable
thereto, subject to the provisions of the definition of Interest Period, and
(iv) whether the Money Market Quotes requested are to set
forth a Money Market Margin or a Money Market Absolute Rate.
The Borrower may request offers to make Money Market Loans for more than one
Interest Period in a single Money Market Quote Request. No Money Market Quote
Request shall be given within five Euro-Dollar Business Days (or such other
number of days as the Borrower and the Agent may agree) of any other Money
Market Quote Request.
(c) Invitation for Money Market Quotes. Promptly upon receipt of a
Money Market Quote Request, the Agent shall send to the Banks by telex or
facsimile transmission an Invitation for Money Market Quotes substantially in
the form of Exhibit C hereto, which shall constitute an invitation by the
Borrower to each Bank to submit Money Market Quotes offering to make the Money
Market Loans to which such Money Market Quote Request relates in accordance with
this Section.
(d) Submission and Contents of Money Market Quotes. (i) Each Bank
may submit a Money Market Quote containing an offer or offers to make Money
Market Loans in response to any Invitation for Money Market Quotes. Each Money
Market Quote must comply with the requirements of this subsection (d) and must
be submitted to the Agent by telex or facsimile transmission at its offices
specified in or pursuant to Section 10.1 not later than (x) 2:00 P.M. (New York
City time) on the fourth Euro-Dollar Business Day prior to the proposed date of
Borrowing, in the case of a LIBOR Auction or (y) 9:30 A.M. (New York City time)
on the proposed date of Borrowing, in the case of an Absolute Rate Auction (or,
in either case, such other time or date as the Borrower and the Agent shall have
mutually agreed and shall have notified to the Banks not later than the date of
the Money Market Quote Request for the first LIBOR Auction or Absolute Rate
Auction for which such change is to be effective); provided that Money Market
Quotes submitted by the Agent (or any affiliate of the Agent) in the capacity of
a Bank may be submitted, and may only be submitted, if the Agent or such
affiliate notifies the Borrower of the terms of the offer or offers contained
therein not later than (x) one hour prior to the deadline for the other Banks,
in the case of a LIBOR Auction or (y) 15 minutes prior to the deadline for the
other Banks, in the case of an Absolute Rate Auction. Subject to Articles 4 and
9, any Money Market Quote so made shall be irrevocable except with the written
consent of the Agent given on the instructions of the Borrower.
(ii) Each Money Market Quote shall be in substantially the form
of Exhibit D hereto and shall in any case specify:
(A) the proposed date of Borrowing,
(B) the principal amount of the Money Market
Loan for which each such offer is being made, which principal amount (w) may be
greater than or less than the Commitment of the quoting Bank, (x) must be
$5,000,000 or a larger multiple of $1,000,000, (y) may not exceed the principal
amount of Money Market Loans for which offers were requested and (z) may be
subject to an aggregate limitation as to the principal amount of Money Market
Loans for which offers being made by such quoting Bank may be accepted,
(C) in the case of a LIBOR Auction, the
margin above or below the applicable London Interbank Offered Rate (the "Money
Market Margin") offered for each such Money Market Loan, expressed as a
percentage (specified to the nearest 1/10,000th of 1%) to be added to or
subtracted from such base rate,
(D) in the case of an Absolute Rate Auction, the
rate of interest per annum (specified to the nearest 1/10,000th of 1%) (the
"Money Market Absolute Rate") offered for each such Money Market Loan, and
(E) the identity of the quoting Bank.
A Money Market Quote may set forth up to five separate offers by the quoting
Bank with respect to each Interest Period specified in the related Invitation
for Money Market Quotes.
(iii) Any Money Market Quote shall be disregarded if it:
(A) is not substantially in conformity with Exhibit D hereto
or does not specify all of the information required by subsection (d)(ii)
above;
(B) contains qualifying, conditional or similar language;
(C) proposes terms other than or in addition to those set
forth in the applicable Invitation for Money Market Quotes; or
(D) arrives after the time set forth in subsection (d)(i).
(e) Notice to Borrower. The Agent shall promptly notify the Borrower
of the terms (x) of any Money Market Quote submitted by a Bank that is in
accordance with subsection (d) and (y) of any Money Market Quote that amends,
modifies or is otherwise inconsistent with a previous Money Market Quote
submitted by such Bank with respect to the same Money Market Quote Request. Any
such subsequent Money Market Quote shall be disregarded by the Agent unless such
subsequent Money Market Quote is submitted solely to correct a manifest error in
such former Money Market Quote. The Agent's notice to the Borrower shall
specify (A) the aggregate principal amount of Money Market Loans for which
offers have been received for each Interest Period specified in the related
Money Market Quote Request, (B) the respective principal amounts and Money
Market Margins or Money Market Absolute Rates, as the case may be, so offered
and (C) if applicable, limitations on the aggregate principal amount of Money
Market Loans for which offers in any single Money Market Quote may be accepted.
(f) Acceptance and Notice by Borrower. Not later than
10:30 A.M. (New York City time) on (x) the third Euro-Dollar Business Day prior
to the proposed date of Borrowing, in the case of a LIBOR Auction or (y) the
proposed date of Borrowing, in the case of an Absolute Rate Auction (or, in
either case, such other time or date as the Borrower and the Agent shall have
mutually agreed and shall have notified to the Banks not later than the date of
the Money Market Quote Request for the first LIBOR Auction or Absolute Rate
Auction for which such change is to be effective), the Borrower shall notify the
Agent of its acceptance or non-acceptance of the offers so notified to it
pursuant to subsection (e). In the case of acceptance, such notice (a "Notice
of Money Market Borrowing") shall specify the aggregate principal amount of
offers for each Interest Period that are accepted. The Borrower may accept any
Money Market Quote in whole or in part; provided that:
(i) the aggregate principal amount of each Money
Market Borrowing may not exceed the applicable amount set forth in the related
Money Market Quote Request;
(ii) the principal amount of each Money Market
Borrowing must be $5,000,000 or a larger whole multiple of $1,000,000;
(iii) acceptance of offers may only be made
on the basis of ascending Money Market Margins or Money Market Absolute Rates,
as the case may be; and
(iv) the Borrower may not accept any offer
that is described in subsection (d)(iii) or that otherwise fails to comply with
the requirements of this Agreement.
Allocation by Agent. If offers are made by two or more Banks with the
same Money Market Margins or Money Market Absolute Rates, as the case may be,
for a greater aggregate principal amount than the amount in respect of which
such offers are accepted for the related Interest Period, the principal amount
of Money Market Loans in respect of which such offers are accepted shall be
allocated by the Agent among such Banks as nearly as possible (in multiples of
$1,000,000, as the Agent may deem appropriate) in proportion to the aggregate
principal amounts of such offers. Determinations by the Agent of the amounts of
Money Market Loans shall be conclusive in the absence of manifest error.
SECTION 2.4 Notice to Banks; Funding of Loans. (a) Upon receipt of a
Notice of Borrowing, the Agent shall promptly notify each Bank of the contents
thereof and of such Bank's share (if any) of such Borrowing and such Notice of
Borrowing shall not thereafter be revocable by the Borrower.
(b) Not later than 12:00 Noon (New York City
time) on the date of each Borrowing, each Bank participating therein shall make
available its share of such Borrowing, in Federal or other funds immediately
available in New York City, to the Agent at its address referred to in Section
10.1. Unless the Agent determines that any applicable condition specified in
Article 4 has not been satisfied, the Agent will make the funds so received from
the Banks available to the Borrower at the Agent's aforesaid address.
(c) Unless the Agent shall have received notice
from a Bank prior to the date of any Borrowing that such Bank will not make
available to the Agent such Bank's share of such Borrowing, the Agent may assume
that such Bank has made such share available to the Agent on the date of such
Borrowing in accordance with subsection (b) of this Section and the Agent may,
in reliance upon such assumption, make available to the Borrower on such date a
corresponding amount. If and to the extent that such Bank shall not have so
made such share available to the Agent, such Bank and the Borrower severally
agree to repay to the Agent forthwith on demand such corresponding amount
together with interest thereon, for each day from the date such amount is made
available to the Borrower until the date such amount is repaid to the Agent, at
(i) in the case of the Borrower, a rate per annum equal to the higher of the
Federal Funds Rate and the interest rate applicable thereto pursuant to Section
2.7 and (ii) in the case of such Bank, the Federal Funds Rate. If such Bank
shall repay to the Agent such corresponding amount, such amount so repaid shall
constitute such Bank's Loan included in such Borrowing for purposes of this
Agreement.
SECTION 2.5 Notes. (a) The Loans of each Bank shall be evidenced by
a single Note payable to the order of such Bank for the account of its
Applicable Lending Office in an amount equal to the aggregate unpaid principal
amount of such Bank's Loans.
(b) Each Bank may, by notice to the Borrower
and the Agent, request that its Loans of a particular type be evidenced by a
separate Note in an amount equal to the aggregate unpaid principal amount of
such Loans. Each such Note shall be in substantially the form of Exhibit A
hereto with appropriate modifications to reflect the fact that it evidences
solely Loans of the relevant type. Each reference in this Agreement to the
"Note" of such Bank shall be deemed to refer to and include any or all of such
Notes, as the context may require.
(c) Upon receipt of each Bank's Note pursuant
to Section 4.1(a), the Agent shall forward such Note to such Bank. Each Bank
shall record the date, amount and type of each Loan made by it and the date and
amount of each payment of principal made by the Borrower with respect thereto,
and may, if such Bank so elects in connection with any transfer or enforcement
of its Note, endorse on the schedule forming a part thereof appropriate
notations to evidence the foregoing information with respect to each such Loan
then outstanding; provided that the failure of any Bank to make, or any error in
making, any such recordation or endorsement shall not affect the obligations of
the Borrower hereunder or under the Notes. Each Bank is hereby irrevocably
authorized by the Borrower so to endorse its Note and to attach to and make a
part of its Note a continuation of any such schedule as and when required.
SECTION 2.6 Maturity of Loans. (a) Each Committed Loan shall
mature, and the principal amount thereof shall be due and payable, together with
accrued interest thereon, on the Termination Date.
(b) Each Money Market Loan included in any Money
Market Borrowing shall mature, and the principal amount thereof shall be due and
payable, together with accrued interest thereon, on the last day of the Interest
Period applicable to such Borrowing.
SECTION 2.7 Interest Rates. (a) Each Base Rate Loan shall bear
interest on the outstanding principal amount thereof, for each day from the date
such Loan is made until it becomes due, at a rate per annum equal to the Base
Rate for such day. Such interest shall be payable quarterly in arrears on each
Quarterly Date and, with respect to the principal amount of any Base Rate Loan
converted to a CD Loan or a Euro-Dollar Loan, on each date a Base Rate Loan is
so converted. Any overdue principal of or interest on any Base Rate Loan shall
bear interest, payable on demand, for each day until paid at a rate per annum
equal to the sum of 2% plus the rate otherwise applicable to Base Rate Loans for
such day.
(b) Each CD Loan shall bear interest on the outstanding principal
amount thereof, for each day during each Interest Period applicable thereto, at
a rate per annum equal to the sum of the CD Margin for such day plus the
Adjusted CD Rate applicable to such Interest Period; provided that if any CD
Loan shall, as a result of clause (2)(b) of the definition of Interest Period,
have an Interest Period of less than 30 days, such CD Loan shall bear interest
during such Interest Period at the rate applicable to Base Rate Loans during
such period. Such interest shall be payable for each Interest Period on the
last day thereof and, if such Interest Period is longer than 90 days, at
intervals of 90 days after the first day thereof. Any overdue principal of or
interest on any CD Loan shall bear interest, payable on demand, for each day
until paid at a rate per annum equal to the sum of 2% plus the higher of (i) the
rate applicable to Base Rate Loans for such day and (ii) the sum of the CD
Margin plus the Adjusted CD Rate applicable to such Loan at the date such
payment was due.
The "Adjusted CD Rate" applicable to any Interest Period means a rate
per annum determined pursuant to the following formula:
[ CDBR ]
ACDR = [ ---------- ] + AR
[ 1.00 - DRP ]
ACDR = Adjusted CD Rate
CDBR = CD Base Rate
DRP = Domestic Reserve Percentage
AR = Assessment Rate
The amount in brackets being rounded upward, if necessary, to the next
higher 1/100 of 1%.
The "CD Base Rate" applicable to any Interest Period is the rate of
interest determined by the Agent to be the average (rounded upward, if
necessary, to the next higher 1/100 of 1%) of the prevailing rates per annum bid
at 10:00 A.M. (New York City time) (or as soon thereafter as practicable) on the
first day of such Interest Period by two or more New York certificate of deposit
dealers of recognized standing for the purchase at face value from each CD
Reference Bank of its certificates of deposit in an amount comparable to the
principal amount of the CD Loan of such CD Reference Bank to which such Interest
Period applies and having a maturity comparable to such Interest Period.
"Domestic Reserve Percentage" means for any day that percentage
(expressed as a decimal) which is in effect on such day, as prescribed by the
Board of Governors of the Federal Reserve System (or any successor) for
determining the maximum reserve requirement (including without limitation any
basic, supplemental or emergency reserves) for a member bank of the Federal
Reserve System in New York City with deposits exceeding five billion dollars in
respect of new non-personal time deposits in dollars in New York City having a
maturity comparable to the related Interest Period and in an amount of $100,000
or more. The Adjusted CD Rate shall be adjusted automatically on and as of the
effective date of any change in the Domestic Reserve Percentage.
"Assessment Rate" means for any day the annual assessment rate in
effect on such day which is payable by a member of the Bank Insurance Fund
classified as adequately capitalized and within supervisory subgroup "A" (or a
comparable successor assessment risk classification) within the meaning of 12
C.F.R. 327.4(a) (or any successor provision) to the Federal Deposit Insurance
Corporation (or any successor) for such Corporation's (or such successor's)
insuring time deposits at offices of such institution in the United States. The
Adjusted CD Rate shall be adjusted automatically on and as of the effective date
of any change in the Assessment Rate.
(c) Each Euro-Dollar Loan shall bear interest on the outstanding
principal amount thereof, for each day during each Interest Period applicable
thereto, at a rate per annum equal to the sum of the Euro-Dollar Margin for such
day plus the London Interbank Offered Rate applicable to such Interest Period.
Such interest shall be payable for each Interest Period on the last day thereof
and, if such Interest Period is longer than three months, at intervals of three
months after the first day thereof.
The "London Interbank Offered Rate" applicable to any Interest Period
means the average (rounded upward, if necessary, to the next higher 1/16 of 1%)
of the respective rates per annum at which deposits in dollars are offered to
each of the Euro-Dollar Reference Banks in the London interbank market at
approximately 11:00 A.M. (London time) two Euro-Dollar Business Days before the
first day of such Interest Period in an amount approximately equal to the
principal amount of the Euro-Dollar Loan of such Euro-Dollar Reference Bank to
which such Interest Period is to apply and for a period of time comparable to
such Interest Period.
(d) Any overdue principal of or interest on any Euro-Dollar Loan
shall bear interest, payable on demand, for each day until paid at a rate per
annum equal to the higher of (i) the sum of 2% plus the Euro-Dollar Margin for
such day plus the quotient obtained (rounded upward, if necessary, to the next
higher 1/100 of 1%) by dividing (x) the average (rounded upward, if necessary,
to the next higher 1/16 of 1%) of the respective rates per annum at which one
day (or, if such amount due remains unpaid more than three Euro-Dollar Business
Days, then for such other period of time not longer than three months as the
Agent may select) deposits in dollars in an amount approximately equal to such
overdue payment due to each of the Euro-Dollar Reference Banks are offered to
such Euro-Dollar Reference Bank in the London interbank market for the
applicable period determined as provided above by (y) 1.00 minus the Euro-Dollar
Reserve Percentage (or, if the circumstances described in clause (a) or (b) of
Section 9.1 shall exist, at a rate per annum equal to the sum of 2% plus the
rate applicable to Base Rate Loans for such day) and (ii) the sum of 2% plus the
Euro-Dollar Margin for such day plus the London Interbank Offered Rate
applicable to such Loan at the date such payment was due.
(e) Subject to Section 9.1, each Money Market
LIBOR Loan shall bear interest on the outstanding principal amount thereof, for
the Interest Period applicable thereto, at a rate per annum equal to the sum of
the London Interbank Offered Rate for such Interest Period (determined in
accordance with Section 2.7(c) as if the related Money Market LIBOR Borrowing
were a Committed Euro-Dollar Borrowing) plus (or minus) the Money Market Margin
quoted by the Bank making such Loan in accordance with Section 2.3. Each Money
Market Absolute Rate Loan shall bear interest on the outstanding principal
amount thereof, for the Interest Period applicable thereto, at a rate per annum
equal to the Money Market Absolute Rate quoted by the Bank making such Loan in
accordance with Section 2.3. Such interest shall be payable for each Interest
Period on the last day thereof and, if such Interest Period is longer than three
months, at intervals of three months after the first day thereof. Any overdue
principal of or interest on any Money Market Loan shall bear interest, payable
on demand, for each day until paid at a rate per annum equal to the sum of 2%
plus the Base Rate for such day.
(f) The Agent shall determine each interest
rate applicable to the Loans hereunder. The Agent shall give prompt notice to
the Borrower and the participating Banks of each rate of interest so determined,
and its determination thereof shall be conclusive in the absence of manifest
error.
(g) Each Reference Bank agrees to use its best
efforts to furnish quotations to the Agent as contemplated by this Section. If
any Reference Bank does not furnish a timely quotation, the Agent shall
determine the relevant interest rate on the basis of the quotation or quotations
furnished by the remaining Reference Bank or Banks or, if none of such
quotations is available on a timely basis, the provisions of Section 9.1 shall
apply.
SECTION 2.8 Fees. (a) The Borrower shall pay to the Agent for the
account of the Banks ratably a facility fee at the Facility Fee Rate (determined
daily in accordance with the Pricing Schedule). Such facility fee shall accrue
(i) from and including the Effective Date to but excluding the date of
termination of the Commitments in their entirety, on the daily aggregate amount
of the Commitments (whether used or unused) and (ii) from and including such
date of termination to but excluding the date the Loans shall be repaid in their
entirety, on the daily aggregate outstanding principal amount of the Loans.
Accrued facility fees shall be payable quarterly in arrears on each Quarterly
Date and on the date of termination of the Commitments in their entirety (and,
if later, the date the Loans shall be repaid in their entirety).
(b) The Borrower shall pay to the Agent
on the Closing Date the fees agreed pursuant to the Morgan Letters. The Agent
shall distribute to each Bank the amount of participation fees previously agreed
by the Agent and such Bank.
SECTION 2.9. Reduction and Extension of the Commitments/Substitution of
Banks. (a) The Borrower shall have the right, upon at least three Domestic
Business Days' notice to the Banks, to permanently terminate in whole or reduce
ratably in part the respective Commitments of the Banks, provided that no such
termination or reduction of Commitments shall be permitted if, after giving
effect thereto and to any prepayments of Loans made on the effective date
thereof, the aggregate outstanding principal amount of Loans, plus the aggregate
outstanding amount of L/C Obligations, would exceed the Commitments then in
effect. Any such reduction shall be in the aggregate amount of $10,000,000 or a
whole multiple of $1,000,000 in excess thereof.
(b) Not earlier than the date 90 days prior and not later than the
date 45 days prior to the Termination Date then in effect, the Borrower may
deliver to the Agent and the Banks a notice requesting that the Commitments be
extended to the first anniversary of such Termination Date. Within 20 days after
its receipt of any such notice, each Bank shall notify the Agent of its
willingness or unwillingness so to extend its Commitment. Any Bank which shall
fail so to notify the Borrower within such period shall be deemed to have
declined to extend its Commitment. In the event each Bank shall be willing to
extend its Commitment, the Agent shall so notify each Bank and the Termination
Date shall without further action be extended to the first anniversary of the
date which shall theretofore have been the Termination Date. In the event that
any Bank shall be unwilling to extend its Commitment, the Commitments of the
Banks will not be extended and the Termination Date shall remain unchanged.
(c) The Borrower may, upon not less than two Domestic Business Days
prior notice to a Bank or Banks and the Agent, terminate in whole the Commitment
of such Bank or Banks and arrange in respect of each terminated Bank for one or
more bank or banks ("Assuming Bank or Banks") (which may be one or more of the
Banks or a bank or banks other than the Banks) to assume a Commitment equal to
or Commitments in aggregate amount equal to the amount of the Commitment of the
terminated Bank, provided that no such termination shall be made unless, at such
time, no event has occurred and is continuing which constitutes an Event of
Default. Such termination shall be effective (x) with respect to each such
terminated Bank's unused Commitment, on the date set forth in such notice,
provided, however, that such date shall be no earlier than two Domestic Business
Days after receipt of such notice or (y) in the event that any Loan is
outstanding from such terminated Bank which is to be paid in connection with
such termination, on the last day of the then current Interest Period relating
to such Loan. Such assumption shall be effective on the date specified in (x)
or (y) above, as the case may be, provided, however, that each terminated Bank
and Assuming Bank shall have delivered to the Borrower and the Agent, on or
prior to such date, an Assignment and Assumption Agreement in substantially the
form of Exhibit F hereto (The term "Bank" as used in this Agreement immediately
following such assumption shall include an Assuming Bank.). Notwithstanding the
provisions of this Section 2.9(c), termination or substitution shall not be
effective unless the Assuming Bank meets, at the time of substitution, the
criteria set forth in this Agreement for an "Eligible Assignee".
Upon the termination of a Bank's Commitment under this subsection
2.9(c), the Borrower will pay or cause to be paid all principal of, and interest
accrued to the date of such payment on, Loans owing to such Bank and pay any
fees payable to such Bank pursuant to the provisions of Section 2.9 with respect
to the Commitment which is terminated, any amounts payable pursuant to the
provisions of Section 2.14 and any other amounts payable to such Bank hereunder
with respect to the Commitment which is terminated or Loans which are paid; and
upon such payments, the obligations of such Bank hereunder shall, by the
provisions hereof, be released and discharged, and it shall be deemed to have
relinquished its rights under this Agreement (other than any rights under
Section 10.3).
SECTION 2.10 Method of Electing Interest Rates. (a) The Loans included in
each Committed Borrowing shall bear interest initially at the type of rate
specified by the Borrower in the applicable Notice of Committed Borrowing.
Thereafter, the Borrower may from time to time elect to change or continue the
type of interest rate borne by each Group of Loans (subject in each case to the
provisions of Article 9 and the last sentence of this subsection (a)), as
follows:
(i) if such Loans are Base Rate Loans,
the Borrower may elect to convert such Loans to CD Loans as of any Domestic
Business Day or to Euro-Dollar Loans as of any Euro-Dollar Business Day;
(ii) if such Loans are CD Loans, the Borrower
may elect to convert such Loans to Base Rate Loans or Euro-Dollar Loans or
elect to continue such Loans as CD Loans for an additional Interest Period,
subject to Section 2.14 in the case of any such conversion or continuation
effective on any day other than the last day of the then current Interest Period
applicable to such Loans; and
(iii) if such Loans are Euro-Dollar Loans,
the Borrower may elect to convert such Loans to Base Rate Loans or CD Loans or
elect to continue such Loans as Euro-Dollar Loans for an additional Interest
Period, subject to Section 2.14 in the case of any such conversion or
continuation effective on any day other than the last day of the then current
Interest Period applicable to such Loans.
Each such election shall be made by delivering a notice (a "Notice of Interest
Rate Election") to the Agent not later than 10:30 A.M. (New York City time) on
the third Euro-Dollar Business Day before the conversion or continuation
selected in such notice is to be effective (unless the relevant Loans are to be
converted to Domestic Loans of the other type or are CD Rate Loans to be
continued as CD Rate Loans for an additional Interest Period, in which case such
notice shall be delivered to the Agent not later than 10:30 A.M. (New York City
time) on the second Domestic Business Day before such conversion or continuation
is to be effective). A Notice of Interest Rate Election may, if it so
specifies, apply to only a portion of the aggregate principal amount of the
relevant Group of Loans; provided that (i) such portion is allocated ratably
among the Loans comprising such Group and (ii) the portion to which such Notice
applies, and the remaining portion to which it does not apply, are each
$5,000,000 or any larger whole multiple of $1,000,000. Notwithstanding the
foregoing, the Borrower may not elect to convert any Committed Loan to, or
continue any Committed Loan as, a Fixed Rate Loan pursuant to any Notice of
Interest Rate Election if at the time such notice is delivered an Event of
Default shall have occurred and be continuing.
(b) Each Notice of Interest Rate Election shall specify:
(i) the Group of Loans (or portion thereof)
to which such notice applies;
(ii) the date on which the conversion or
continuation selected in such notice is to be effective, which shall comply with
the applicable clause of subsection (a) above;
(iii) if the Loans comprising such Group are
to be converted, the new type of Loans and, if the Loans being converted are to
be Fixed Rate Loans, the duration of the next succeeding Interest Period
applicable thereto; and
(iv) if such Loans are to be continued as
CD Loans or Euro-Dollar Loans for an additional Interest Period, the duration of
such additional Interest Period.
Each Interest Period specified in a Notice of Interest Rate Election shall
comply with the provisions of the definition of Interest Period.
(c) Upon receipt of a Notice of Interest Rate Election from the
Borrower pursuant to subsection (a) above, the Agent shall promptly notify each
Bank of the contents thereof and such notice shall not thereafter be revocable
by the Borrower. If no Notice of Interest Rate Election is timely received
prior to the end of an Interest Period for any Group of Loans, the Borrower
shall be deemed to have elected that such Group of Loans be converted to Base
Rate Loans as of the last day of such Interest Period.
(d) An election by the Borrower to change or continue the rate of
interest applicable to any Group of Loans pursuant to this Section shall not
constitute a "Borrowing" subject to the provisions of Section 4.2.
SECTION 2.11 Scheduled Termination of Commitments. The Commitments
shall terminate on the Termination Date.
SECTION 2.12 Optional Prepayments. (a) Subject in the case of any
Fixed Rate Borrowing to Section 2.14, the Borrower may, upon at least one
Domestic Business Day's notice to the Agent, prepay any Group of Domestic Loans
(or any Money Market Borrowing bearing interest at the Base Rate pursuant to
Section 9.1) or upon at least three Euro-Dollar Business Days' notice to the
Agent, prepay any Group of Euro-Dollar Loans, in each case in whole at any time,
or from time to time in part in amounts aggregating $5,000,000 or any larger
whole multiple of $1,000,000, by paying the principal amount to be prepaid
together with accrued interest thereon to the date of prepayment. Each such
optional prepayment shall be applied to prepay ratably the Loans of the several
Banks included in such Group (or Borrowing).
(b) Except as provided in subsection (a)
above the Borrower may not prepay all or any portion of the principal amount of
any Money Market Loan prior to the maturity thereof.
(c) Upon receipt of a notice of prepayment
pursuant to this Section, the Agent shall promptly notify each Bank of the
contents thereof and of such Bank's ratable share (if any) of such prepayment
and such notice shall not thereafter be revocable by the Borrower.
SECTION 2.13 General Provisions as to Payments. (a) The Borrower
shall make each payment of principal of, and interest on, the Loans and of fees
hereunder, not later than 12:00 Noon (New York City time) on the date when due,
in Federal or other funds immediately available in New York City, to the Agent
at its address referred to in Section 10.1. The Agent will promptly distribute
to each Bank its ratable share of each such payment received by the Agent for
the account of the Banks. Whenever any payment of principal of, or interest on,
the Domestic Loans or of fees shall be due on a day which is not a Domestic
Business Day, the date for payment thereof shall be extended to the next
succeeding Domestic Business Day. Whenever any payment of principal of, or
interest on, the Euro-Dollar Loans shall be due on a day which is not a Euro-
Dollar Business Day, the date for payment thereof shall be extended to the next
succeeding Euro-Dollar Business Day unless such Euro-Dollar Business Day falls
in another calendar month, in which case the date for payment thereof shall be
the next preceding Euro-Dollar Business Day. Whenever any payment of principal
of, or interest on, the Money Market Loans shall be due on a day which is not a
Euro-Dollar Business Day, the date for payment thereof shall be extended to the
next succeeding Euro-Dollar Business Day. If the date for any payment of
principal is extended by operation of law or otherwise, interest thereon shall
be payable for such extended time.
(b) Unless the Agent shall have received notice
from the Borrower prior to the date on which any payment is due to the Banks
hereunder that the Borrower will not make such payment in full, the Agent may
assume that the Borrower has made such payment in full to the Agent on such date
and the Agent may, in reliance upon such assumption, cause to be distributed to
each Bank on such due date an amount equal to the amount then due such Bank. If
and to the extent that the Borrower shall not have so made such payment, each
Bank shall repay to the Agent forthwith on demand such amount distributed to
such Bank together with interest thereon, for each day from the date such amount
is distributed to such Bank until the date such Bank repays such amount to the
Agent, at the Federal Funds Rate.
SECTION 2.14 Funding Losses. If the Borrower makes any payment of
principal with respect to any Fixed Rate Loan or any Fixed Rate Loan is
converted (pursuant to Article 2, 7 or 9 or otherwise) on any day other than the
last day of an Interest Period applicable thereto, or the last day of an
applicable period fixed pursuant to Section 2.3(f), or if the Borrower fails to
borrow, prepay, convert or continue any Fixed Rate Loans after notice has been
given to any Bank in accordance with Section 2.4(a), 2.12(c) or 2.10(c) the
Borrower shall reimburse each Bank within 15 days after demand for any resulting
loss or expense incurred by it (or by an existing or prospective Participant in
the related Loan), including (without limitation) any loss incurred in
obtaining, liquidating or employing deposits from third parties, but excluding
loss of margin for the period after any such payment or conversion or failure to
borrow, prepay, convert or continue, provided that such Bank shall have
delivered to the Borrower a certificate as to the amount of such loss or
expense, which certificate shall be conclusive in the absence of manifest error.
SECTION 2.15 Computation of Interest and Fees. Interest based on the
Prime Rate hereunder shall be computed on the basis of a year of 365 days (or
366 days in a leap year) and paid for the actual number of days elapsed
(including the first day but excluding the last day). All other interest and
fees shall be computed on the basis of a year of 360 days and paid for the
actual number of days elapsed (including the first day but excluding the last
day).
SECTION 2.16 Regulation D Compensation. The Borrower agrees to pay
to each Bank which requests compensation under this paragraph by notice to the
Borrower, on the last day of each Interest Period with respect to any Euro-
Dollar Loan made by such Bank, at any time when such Bank shall be required to
maintain reserves against "Eurocurrency liabilities" under Regulation D of the
Board of Governors of the Federal Reserve System (or, at any time when such Bank
may be required by the Board of Governors of the Federal Reserve System or by
any other governmental authority, whether within the United States or in another
relevant jurisdiction, to maintain reserves against any other category of
liabilities which includes deposits by reference to which the Euro-Dollar Rate
is determined as provided in this Agreement or against any category of
extensions of credit or other assets of such Bank which includes any such Euro-
Dollar Loans), an additional amount (determined by such Bank's calculation or,
if an accurate calculation is impracticable, reasonable estimate using such
reasonable means of allocation as such Bank shall determine) equal to the actual
costs, if any, incurred by such Bank during such Interest Period as a result of
the applicability of the foregoing reserves to such Euro-Dollar Loans.
ARTICLE 3
LETTERS OF CREDIT
SECTION 3.1 L/C Commitment. (a) Subject to the terms and conditions
hereof, the Issuing Bank, in reliance on the agreements of the other Banks set
forth in Section 3.4(a), agrees to issue letters of credit ("Letters of Credit")
for the account of the Borrower on any Domestic Business Day from the date
hereof through the Termination Date in such form as may be approved from time to
time by the Issuing Bank; provided that the Issuing Bank shall not issue any
Letter of Credit if, after giving effect to such issuance, (i) the L/C
Obligations would exceed the L/C Commitment or (ii) the outstanding principal
amount of Loans, plus the aggregate outstanding amount of L/C Obligations, would
exceed the Commitments. Each Letter of Credit shall (i) be denominated in
dollars, (ii) be either (x) a standby letter of credit issued to support (I)
obligations of the Borrower or any of its Subsidiaries, contingent or otherwise,
which finance the working capital or other business needs of the Borrower or its
Subsidiaries or (II) performance obligations of the Borrower and its
Subsidiaries (including, without limitation, to obtain insurance coverage) (a
"Standby Letter of Credit"), or (y) a commercial letter of credit in respect of
the purchase of goods or services by the Borrower or any of its Subsidiaries (a
"Commercial Letter of Credit"), (iii) expire no later than the Termination Date
in the case of a Standby Letter of Credit and no later than 30 days prior to the
Termination Date in the case of a Commercial Letter of Credit and (iv) expire no
later than 360 days after its date of issuance in the case of each Commercial
Letter of Credit.
(b) Each Letter of Credit shall be subject
to the Uniform Customs and, to the extent not inconsistent therewith, the laws
of the State of New York.
SECTION 3.2 Procedure for Issuance of Letter of Credit. The Borrower may
from time to time request that the Issuing Bank issue a Letter of Credit by
delivering to the Issuing Bank at its address for notices specified herein an
Application therefor, completed to the reasonable satisfaction of the Issuing
Bank. Upon receipt of any Application, the Issuing Bank will process such
Application in accordance with its customary procedures and shall promptly issue
the Letter of Credit requested thereby (but in no event shall the Issuing Bank
be required to issue any Letter of Credit earlier than three Business Days after
its receipt of the Application therefor) by issuing the original of such Letter
of Credit to the beneficiary thereof or as otherwise may be agreed to by the
Issuing Bank and the Borrower. The Issuing Bank shall furnish a copy of such
Letter of Credit to the Borrower promptly following the issuance thereof. The
Issuing Bank shall promptly furnish to the Agent, which shall in turn promptly
furnish to the Banks, notice of the issuance of each Standby Letter of Credit
(including the amount thereof and each Bank's pro rata share). On each L/C Fee
Payment Date, the Issuing Bank shall promptly furnish to the Agent, which shall
in turn promptly furnish to the Borrower and the Banks, notice of the aggregate
face amount of the Letters of Credit outstanding on such date and such other
information as is necessary for the computation of the letters of credit
commission due on such date.
SECTION 3.3 Fees, Commissions and Other Charges. (a) The Borrower will
pay to the Agent for the account of the Issuing Bank and the Banks a commission
on all outstanding Standby Letters of Credit at the rate per annum 1/8% above
the Euro-Dollar Margin of the face amount of each such Standby Letter of Credit,
of which 1/8% per annum will be a fronting fee for the account of the Issuing
Bank, and the remainder will be shared ratably among the Banks, payable
quarterly in arrears on each L/C Fee Payment Date after the issuance date. The
Borrower will pay to the Agent for the account of the Issuing Bank and the Banks
a commission on all outstanding Commercial Letters of Credit at the rate per
annum 1/8% above the Euro-Dollar Margin of the average daily face amount of such
Letters of Credit during the period for which such payment is made, of which
1/8% per annum will be a fronting fee for the account of the Issuing Bank, and
the remainder will be shared ratably among the Banks, payable quarterly in
arrears on each L/C Fee Payment Date.
(b) In addition to the foregoing fees and
commissions, the Borrower shall pay or reimburse the Issuing Bank for such
normal and customary costs and expenses as are incurred or charged by the
Issuing Bank in issuing, negotiating, effecting payment under, amending or
otherwise administering any Letter of Credit.
(c) The Agent shall, promptly following its
receipt thereof, distribute to the Issuing Bank and the L/C Participants all
fees and commissions received by the Agent for their respective accounts
pursuant to this Section.
SECTION 3.4 L/C Participations. (a) The Issuing Bank irrevocably agrees
to grant and hereby grants to each L/C Participant, and, to induce the Issuing
Bank to issue Letters of Credit hereunder, each L/C Participant irrevocably
agrees to accept and purchase and hereby accepts and purchases from the Issuing
Bank, on the terms and conditions hereinafter stated, for such L/C Participant's
own account and risk an undivided interest equal to such L/C Participant's
Commitment Percentage in the Issuing Bank's obligations and rights under each
Letter of Credit issued hereunder and the amount of each draft paid by the
Issuing Bank thereunder. Each L/C Participant unconditionally and irrevocably
agrees with the Issuing Bank that, if a draft is paid under any Letter of Credit
for which the Issuing Bank is not reimbursed in full by the Borrower in
accordance with the terms of this Agreement, such L/C Participant shall pay to
the Issuing Bank upon demand at the Issuing Bank's address for notices specified
herein an amount equal to such L/C Participant's Commitment Percentage of the
amount of such draft, or any part thereof, which is not so reimbursed.
(b) If any amount required to be paid by any
L/C Participant to the Issuing Bank pursuant to Section 3.4(a) in respect of
any unreimbursed portion of any payment made by the Issuing Bank under any
Letter of Credit is paid to the Issuing Bank within three Business Days after
the date such payment is due, such L/C Participant shall pay to the Issuing Bank
on demand an amount equal to the product of (i) such amount, times (ii) the
daily average Federal Funds Rate during the period from and including the date
such payment is required to the date on which such payment is immediately
available to the Issuing Bank, times (iii) a fraction the numerator of which is
the number of days that elapse during such period and the denominator of which
is 360. If any such amount required to be paid by any L/C Participant pursuant
to Section 3.4(a) is not made available to the Issuing Bank by such L/C
Participant within three Business Days after the date such payment is due, the
Issuing Bank shall be entitled to recover from such L/C Participant, on demand,
such amount with interest thereon calculated from such due date at the rate per
annum applicable to Base Rate Advances hereunder. A certificate of the Issuing
Bank submitted to any L/C Participant with respect to any amounts owing under
this Section shall be conclusive in the absence of manifest error.
(c) Whenever, at any time after the
Issuing Bank has made payment under any Letter of Credit and has received from
any L/C Participant its pro rata share of such payment in accordance with
Section 3.4(a), the Issuing Bank receives any payment related to such Letter of
Credit (whether directly from the Borrower or otherwise), or any payment of
interest on account thereof, the Issuing Bank will distribute to such L/C
Participant its pro rata share thereof; provided, however, that in the event
that any such payment received by the Issuing Bank shall be required to be
returned by the Issuing Bank, such L/C Participant shall return to the Issuing
Bank the portion thereof previously distributed by the Issuing Bank to it.
SECTION 3.5 Reimbursement Obligation of the Borrower. The Borrower
agrees to reimburse the Issuing Bank on each date on which the Issuing Bank
notifies the Borrower of the date and amount of a draft presented under any
Letter of Credit and paid by the Issuing Bank for the amount of such draft so
paid; provided that if the Issuing Bank does not notify the Borrower as provided
for above earlier than 10:30 A.M. (New York City time) on the date such draft is
paid then such reimbursement payment shall not be due until the Business Day
immediately subsequent to the date such draft is paid. Each such payment shall
be made to the Issuing Bank at its address for notices specified herein in
lawful money of the United States and in immediately available funds. Interest
shall be payable on any and all amounts remaining unpaid by the Borrower under
this Section from the date such amounts become payable (whether at stated
maturity, by acceleration or otherwise) until payment in full at a rate per
annum equal at all times to 1-1/2% per annum above the Base Rate; provided that
if the Issuing Bank does not notify the Borrower as provided for above earlier
than 10:30 A.M. (New York City time) on the date such draft is paid, then for
such day (and until the next Business Day) all amounts remaining unpaid in
respect of such notice shall bear interest at a rate per annum equal to the Base
Rate.
SECTION 3.6 Obligations Absolute. The Borrower's obligations under
this Article 3 shall be absolute and unconditional under any and all
circumstances and irrespective of any setoff, counterclaim or defense to payment
which the Borrower may have or have had against the Issuing Bank, any
beneficiary of a Letter of Credit or any other Person. The Borrower also agrees
with the Issuing Bank and the L/C Participants that the Issuing Bank shall not
be responsible for, and the Borrower's Reimbursement Obligations under Section
3.5 shall not be affected by, among other things, the validity or genuineness of
documents or of any endorsements thereon, even though such documents shall in
fact prove to be invalid, fraudulent or forged, or any dispute between or among
the Borrower and any beneficiary of any Letter of Credit or any other party to
which such Letter of Credit may be transferred or any claims whatsoever of the
Borrower against any beneficiary of such Letter of Credit or any such
transferee. The Issuing Bank shall not be liable for any error, omission,
interruption or delay in transmission, dispatch or delivery of any message or
advice, however transmitted, in connection with any Letter of Credit, except for
errors or omissions constituting gross negligence or willful misconduct of the
Issuing Bank. The Borrower agrees that any action taken or omitted by the
Issuing Bank under or in connection with any Letter of Credit or the related
drafts or documents, if done in the absence of gross negligence or willful
misconduct and in accordance with the standards of care specified in the Uniform
Commercial Code of the State of New York, shall be binding on the Borrower and
shall not result in any liability of the Issuing Bank to the Borrower.
SECTION 3.7 Letter of Credit Payments. If any draft shall be
presented for payment under any Letter of Credit, the Issuing Bank shall
promptly notify the Borrower of the date and amount thereof. The responsibility
of the Issuing Bank to the Borrower in connection with any draft presented for
payment under any Letter of Credit shall, in addition to any payment obligation
expressly provided for in such Letter of Credit, be limited to determining that
the documents (including each draft) delivered under such Letter of Credit in
connection with such presentment are substantially in conformity with such
Letter of Credit.
SECTION 3.8 Applications. To the extent that any provision of any
Application related to any Letter of Credit is inconsistent with any of the
provisions of this Agreement, or impose obligations or conditions different than
or in addition to those imposed by this Agreement, the provisions of this
Agreement shall apply.
ARTICLE 4
CONDITIONS OF EXTENSIONS OF CREDIT
SECTION 4.1 Condition Precedent to Initial Extension of Credit. The
obligation of each Bank to make an extension of credit (through the making of a
Loan or issuance or participation in a Letter of Credit) on the occasion of the
initial extension of credit is subject to the satisfaction of the following
condition precedent on or before the day of the initial extension of credit:
(a) The Agent shall have received this Agreement
executed in full and the Notes to the order of the Banks, respectively.
(b) The Agent shall have received an Officer's
Certificate attaching copies of the resolutions of the Board of Directors of the
Borrower (or an authorized committee thereof) approving this Agreement and the
Notes, and of all documents evidencing other necessary corporate action with
respect to this Agreement and the Notes.
(c) The Agent shall have received an Officer's
Certificate certifying (i) as to the names and true signatures of the officers
of the Borrower authorized to sign this Agreement and the Notes and the other
documents to be delivered hereunder, (ii) that there has been no material
adverse change in the property, financial condition or operations of the
Borrower and its Subsidiaries, taken as a whole, from that shown on the
consolidated financial statements as at, and for the twelve months ended,
December 31, 1995 and (iii) there is no action, suit or proceeding pending or,
to the knowledge of the Borrower, threatened against the Borrower or any
Subsidiary the reasonable anticipated outcome of which would materially and
adversely affect the Spinoff or any other transaction contemplated hereby, the
ability of the Borrower to perform the obligations under this Agreement or any
Note or which purports to affect the legality, validity or enforceability of
this Agreement or any Note.
(d) The Agent shall have received favorable
opinions of counsel of the Borrower, substantially in the form of Exhibits E-1,
E-2 and E-3 hereto and as to such other matters as any Bank may reasonably
request.
(e) The Agent shall have received a copy of
the solvency opinion dated December 9, 1996 from American Appraisal Associates,
Inc. delivered to Olin's Board of Directors in connection with the Spinoff.
(f) The Agent shall have received all requested
documentation relevant to the potential or actual environmental liabilities of
Primex, with respect to all real property that is to be owned or leased by
Primex and its Subsidiaries after giving effect to the Spinoff, which shall be
reasonably satisfactory to the Banks in form and substance.
(g) All material documentation regarding the
Spinoff and the transactions contemplated thereby and hereby, including the tax
aspects of the Spinoff and the capital and ownership structure of Primex and its
Subsidiaries subsequent to the Spinoff, in each case, shall be reasonably
satisfactory to the Banks in form and substance.
(h) The Agent shall have received all fees due
the Banks from the Borrower on or prior to the Closing Date pursuant to any
prior agreement by the Borrower.
SECTION 4.2 Conditions Precedent to Each Extension of Credit The
obligation of each Bank to make any extension of credit (including the initial
extension of credit) shall be subject to the further conditions precedent that
on the date of such extension of credit (a) the following statements shall be
true (and each of the giving of the applicable Notice of Borrowing or delivery
of an Application for a Letter of Credit and the acceptance by the Borrower of
the proceeds of such extension of credit shall constitute a representation and
warranty by the Borrower that on the date of such extension of credit that such
statements are true):
(i) The representations and warranties
contained in Section 5.1 are correct on and as of the date of such extension of
credit, before and after giving effect to such extension of credit and to the
application of the proceeds therefrom, as though made on and as of such date,
and
(ii) No event has occurred and is continuing,
or would result from such extension of credit or from the application of the
proceeds therefrom, which constitutes an Event of Default or which would
constitute an Event of Default but for the requirement that notice be given or
time elapse or both.
(b) In the case of an extension of credit in the form of issuance of
a Letter of Credit, the Issuing Bank shall have received the appropriate
Application, executed and delivered by a duly authorized officer of the
Borrower.
ARTICLE 5
REPRESENTATIONS AND WARRANTIES
SECTION 5.1 Representations and Warranties of the Borrower. Subject
to Section 5.2, the Borrower represents and warrants as follows:
(a) (1) The Borrower is a corporation duly
organized, validly existing and in good standing under the laws of the
jurisdiction in which it is organized, has all requisite corporate power and
authority to conduct its business, to own its properties and assets as it is now
conducted and as proposed to be conducted and is qualified or licensed to do
business as a foreign corporation in good standing in all jurisdictions in which
the conduct of business requires it to so qualify or be licensed except where
the failure to be so qualified or licensed or in good standing would not
reasonably be expected to have a Material Adverse Effect.
(2) Each of the Borrower's Subsidiaries
is duly organized, validly existing and in good standing under the laws of its
jurisdiction of organization, and has all corporate powers and all governmental
licenses, authorizations, consents and approvals required to carry on its
business as now conducted, except to the extent that failure to do so would not
reasonably be expected to have a Material Adverse Effect.
(b) The execution, delivery and performance by
the Borrower of this Agreement, the Notes and any Application, including the
Borrower's use of the proceeds thereof, are within the Borrower's corporate
powers, have been duly authorized by all necessary corporate action, and do not
contravene (i) the Borrower's charter or by-laws or (ii) law (including, without
limitation, Regulations G, T, U and X issued by the Board of Governors of the
Federal Reserve Board) or any material contractual restriction binding on or
affecting the Borrower.
(c) No authorization or approval or other
action by, and no notice to or filing with, any governmental authority or
regulatory body is required for the due execution, delivery and performance by
the Borrower of this Agreement, the Notes and any Application, except such as
have been obtained. The Borrower and its Subsidiaries are in compliance with
all applicable laws, ordinances, rules, regulations, orders and requirements of
government authorities the failure to comply with which would have a Material
Adverse Effect, except where the necessity of compliance therewith is being
contested in good faith by appropriate proceedings.
(d) This Agreement is, and each of the Notes
and Applications (if any) when delivered hereunder will be, the legal, valid
and binding obligation of the Borrower enforceable against the Borrower in
accordance with their respective terms.
(e) There has been no material adverse change
in the financial condition or operations of the Borrower and its Subsidiaries,
taken as a whole, from that shown by its combined financial statements as at,
and for the twelve months ended, December 31, 1995.
(f) There are no actions, suits or proceedings
pending or, to the knowledge of the Borrower, threatened against the Borrower
or any Subsidiary the reasonably anticipated outcome of which would materially
and adversely affect the ability of the Borrower to perform its obligations
under this Agreement or any Note or which purports to affect the legality,
validity or enforceability of this Agreement or any Note.
(g) After giving effect to each Loan, not
more than 25% of the value of the property and assets of the Borrower, either
individually or on a consolidated basis consists of margin stock (as defined in
the Regulations issued by the Board of Governors of the Federal Reserve Board).
(h) The Borrower is not engaged in the
business of extending credit for the purpose of purchasing or carrying margin
stock (within the meaning of Regulation U issued by the Board of Governors of
the Federal Reserve System), and no proceeds of any Loan will be used to
purchase or carry any margin stock or to extend credit to others for the purpose
of purchasing or carrying any margin stock, except in compliance with
Regulations G, T, U and X issued by the Board of Governors of the Federal
Reserve Board.
(i) Neither the Borrower nor any Subsidiary
is an "investment company" or a company "controlled" by an "investment company"
within the meaning of the Investment Company Act of 1940.
(j) The Borrower and each Subsidiary have
filed all tax returns (Federal, state and local) required to be filed and paid
all taxes shown thereon to be due, including interest and penalties, or provided
adequate reserves for payment thereof.
(k) In the ordinary course of its business,
the Borrower conducts an ongoing review of the effect of Environmental Laws on
the operations and properties of the Borrower, in the course of which it
identifies and evaluates associated liabilities and costs (including, without
limitation, any capital or operating expenditures required for clean-up or
closure of properties presently or previously owned, any liabilities in
connection with off-site deposit of Hazardous Substances or wastes, any capital
or operating expenditures required to achieve or maintain compliance with
environmental protection standards imposed by law or as a condition of any
license, permit or contract, any related constraints on operating activities,
including any periodic or permanent shutdown of any facility or reduction in the
level of or change in the nature of operations conducted thereat and any actual
or potential liabilities to third parties, including employees, and any related
costs and expenses). On the basis of this review, the Borrower has reasonably
concluded that such associated liabilities and costs, including the costs of
compliance with Environmental Laws, are unlikely to cause a material adverse
change in the financial condition or results of operations of the Borrower from
that shown on its combined financial statements as at, and for the nine month
period ended, September 30, 1996.
(l) (1) The combined balance sheet of
Primex and its Consolidated Subsidiaries as of December 31, 1995 and the related
combined statements of income and cash flow for the fiscal year then ended,
reported on by KPMG Peat Marwick LLP and set forth in the Form 10 of Primex, a
copy of which has been delivered to each of the Banks, fairly present, in
conformity with GAAP, the combined financial position of Primex and its
Consolidated Subsidiaries as of such date and their combined results of
operations and cash flows for such fiscal year.
(2) The unaudited combined balance
sheet of Primex and its Consolidated Subsidiaries as of September 30, 1996 and
the related unaudited combined statements of income and cash flow for the nine
months then ended, set forth in the Form 10 of Primex, a copy of which has been
delivered to each of the Banks, fairly present, in conformity with GAAP applied
on a basis consistent with the financial statements referred to in paragraph
(l)(1) of this Article 5, the combined financial position of Primex and its
Consolidated Subsidiaries as of such date and their combined results of
operations and cash flows for such nine month period (subject to normal year-end
adjustments).
(3) Except as disclosed in the Borrower's
most recent Form 10, Form 10-K or Form 10-Q, as the case may be, since December
31, 1995, there has been no material adverse change in the financial position or
results of operations of the Borrower and its Subsidiaries, considered as a
whole.
(m) Subject to the last sentence of this
Section 4.2(m), (i) no ERISA Event has occurred or is reasonably likely to occur
with respect to the Borrower, (ii) there was no Insufficiency with respect to
any Plan and (iii) each of the Borrower and each ERISA Affiliate is in
compliance in all respects with the presently applicable provisions of ERISA and
the Internal Revenue Code with respect to each Plan. Notwithstanding the
foregoing, this Section 4.2(m) shall be deemed true and correct unless such
ERISA Event, Insufficiency or non-compliance alone or in the aggregate is
reasonably likely to have a Material Adverse Effect.
(n) All information heretofore furnished
by the Borrower to the Agent or any Bank for purposes of or in connection with
this Agreement or any transaction contemplated hereby (other than projections,
assumptions, estimates or predictions), including but not limited to the
Information Statement, is and all such information hereafter furnished by the
Borrower to any Bank (other than projections, assumptions, estimates or
predictions) will be, in each case as modified or supplemented by the other
information so furnished, true and accurate in all material respects on the date
as of which such information is stated or certified. The Borrower has disclosed
to the Banks in writing any and all facts which materially and adversely affect
or may affect (to the extent the Borrower can now reasonably foresee), the
business, operations or financial condition of the Borrower and its
Subsidiaries, taken as a whole, or the ability of the Borrower to perform its
obligations under this Agreement, it being understood that facts do not include
projections, estimates, assumptions or predictions.
SECTION 5.2 Representations and Warranties of Olin. Notwithstanding
Section 5.1, so long as and only as long as Olin is the Borrower under this
Agreement, the representations and warranties made under this Agreement shall be
only those contained in Section 5.1(a)(1), (b), (c), (d), (e), (f), (g), (h),
(i), (j) and (k) (provided that, with respect to Olin, the final sentence of
such Section 5.1(k) shall state as follows "On the basis of this review, the
Borrower has reasonably concluded that, except with respect to any matter
disclosed in Items 1 or 3 in the Borrower's 1995 Form 10-K or in the Commitments
and Contingencies Note to the consolidated financial statements incorporate
therein, such associated liabilities and costs, including the costs of
compliance with Environmental Laws, are unlikely to cause a material adverse
change in the financial condition or results of operations of the Borrower from
that shown on its consolidated financial statements as at, and for the nine
month period ended, September 30, 1996") above, and the other representations
contained in such Section 5.1 shall be without any force or effect with respect
to Olin.
SECTION 5.3 Representations on Spinoff Date. The representations and
warranties of Primex set forth in Section 5.1 shall be deemed made on the
Spinoff Date and shall be true and correct on and as of the Spinoff Date.
ARTICLE 6
COVENANTS OF THE BORROWER
SECTION 6.1 Affirmative Covenants. Subject to Section 6.3, so long as any
Loan or Letter of Credit shall remain outstanding and unpaid or any Bank shall
have any Commitment hereunder, the Borrower will, unless the Required Banks
shall otherwise consent in writing:
(a) Compliance with Laws, Etc. Comply, and
cause each Subsidiary to comply, with all applicable laws, ordinances, rules,
regulations, orders and requirements of governmental authorities (including
without limitation Environmental Laws and ERISA and the rules and regulations
thereunder) the failure to comply with which would have a Material Adverse
Effect, except where the necessity of compliance therewith is being contested in
good faith by appropriate proceedings.
(b) Ratio of Consolidated EBIT to Consolidated
Interest Expense. Maintain, for any period of four consecutive fiscal quarters
ending during any period set forth below, a ratio of Consolidated EBIT to
Consolidated Interest Expense at least equal to the ratio set forth opposite
such period below:
Period Ratio
Closing Date through June 30, 1997 1.75 to 1.00
Thereafter 2.00 to 1.00
(c) Ratio of Consolidated Debt to Consolidated EBITDA. Cause the
ratio of (i) Consolidated Debt as at the last day of any fiscal quarter ending
during any period set forth below to (ii) Consolidated EBITDA for the four
consecutive fiscal quarters ending on such last day, to be no greater than the
ratio set forth opposite such period below:
Period Ratio
Closing Date through June 30, 1997 3.50 to 1.00
July 1, 1997 through December 31, 1998 3.25 to 1.00
Fiscal Year 1999 3.25 to 1.00
Thereafter 3.00 to 1.00
(d) Minimum Consolidated Tangible Net Worth.
Cause Consolidated Tangible Net Worth to be, at any date of determination, at
least the sum of (i) $70,000,000 plus (ii) 50% of Consolidated Net Income for
each fiscal quarter ended after December 31, 1996 and prior to the date of such
determination for which such Consolidated Net Income is a positive number.
(e) Use of Proceeds. Use the proceeds of
the Loans made under this Agreement to finance the Spinoff and for general
corporate purposes. None of such proceeds will be used, directly or indirectly,
for the purpose, whether immediate, incidental or ultimate, of buying or
carrying any "margin stock" in violation of Regulation U.
(f) Insurance; Property Maintenance. Maintain,
and cause each Subsidiary to maintain, insurance with reputable insurance
companies or associations in such amount and covering such risks as the
Borrower, in its good faith business judgment, believes necessary; maintain, and
cause each of its Subsidiaries to maintain, all of their respective properties
that are used in the conduct of their respective businesses in good working
order and condition, ordinary wear and tear excepted, except as otherwise
permitted under this Agreement and except where the failure to do so would not
have a Material Adverse Effect.
(g) ERISA. Meet and ensure that each Borrower
and ERISA Affiliate will meet its minimum funding requirements and all of its
other obligations under ERISA with respect to all of its Plans and satisfy all
of its obligations to Multiemployer Plans, including any Withdrawal Liability,
if the failure to do so would have a Material Adverse Effect.
(h) Reporting Requirements. Furnish to the Banks:
(i) as soon as available and in any
event, within 60 days after the end of each of the first three quarters of each
year, a balance sheet of the Borrower and the Consolidated Subsidiaries, on a
consolidated basis, as of the end of such quarter and statements of income and
retained earnings and cash flow of the Borrower and the Consolidated
Subsidiaries, on a consolidated basis, for the period commencing at the end of
the previous year and ending with the end of such quarter, certified by the
chief financial officer of the Borrower, subject to audit and year end
adjustments;
(ii) as soon as available and in any
event within 120 days after the end of each year, a copy of the balance sheets
of the Borrower and the Consolidated Subsidiaries, on a consolidated basis, as
of the end of such year and the statements of income and retained earnings and
cash flow of the Borrower and the Consolidated Subsidiaries, on a consolidated
basis, for such year, certified by KPMG Peat Marwick or another independent
nationally recognized firm of public accountants;
(iii) as soon as possible and in any event
within ten days after an officer of the Borrower becomes aware of the occurrence
of each Event of Default (and each event which, with the giving of notice or
lapse of time, or both, would constitute an Event of Default), an Officer's
Certificate setting forth details of such Event of Default or event and the
action which the Borrower has taken and proposes to take with respect thereto;
(iv) contemporaneously with each delivery
of the statements referred to in clauses (i) and (ii) above,(A) either an
Officer's Certificate stating that no Event of Default (other than by reason of
non-compliance with the covenants referred to in Sections 6.1(b), (c) and (d))
and no event which, with the giving of notice or lapse of time, or both, would
constitute an Event of Default (other than by reason of non-compliance with the
covenants referred to in Sections 6.1(b), (c) and (d)) occurred during such
quarter or, if applicable, an Officer's Certificate pursuant to clause (iii)
above, (B) an Officer's Certificate stating that, as of the last day of the
preceding quarter, the Borrower was in compliance with the covenants referred to
in Sections 6.1(b), (c) and (d) and providing reasonable details of the
calculations evidencing the Borrower's compliance with such covenants and (C)
reasonable details of each material change in GAAP from those applied in
preparing the statements referred to in Section 5.1(e) insofar as such changes
are applicable to the statements referred to in clauses (i) and (ii) above;
(v) promptly after the sending or filing
thereof, copies of all reports which the Borrower sends to any of its
shareholders, and copies of all reports and registration statements which the
Borrower or any Subsidiary files with the Securities and Exchange Commission or
any national securities exchange (other than those pertaining to employee or
director benefit plans or programs);
(vi) such other information respecting
the condition or operations, financial or otherwise, of the Borrower or any
Subsidiary as any Bank may from time to time reasonably request, including but
not limited to backlog information; and
(vii) as soon as possible (and in any
event within ten days) after the occurrence of an ERISA Event or Insufficiency
with respect to any Plan which individually or the aggregate are reasonably
likely to result in liability to the Borrower in excess of $10,000,000, written
notice of such ERISA Event or Insufficiency.
(i) Conduct of Business and Maintenance of Existence.
Continue, and will cause each Subsidiary to continue, to engage in business
of the same general type as now conducted by the Borrower and its
Subsidiaries, and will preserve, renew and keep in full force and effect,
and will cause each Subsidiary to preserve, renew and keep in full force
and effect their respective existence and their respective material rights,
privileges and franchises necessary in the normal conduct of business;
provided that nothing in this Section 6.1(i) shall prohibit (i) the merger
of a Subsidiary into the Borrower or the merger or consolidation of a
Subsidiary with or into another Person if the Person surviving such
consolidation or merger is a Subsidiary and if, in each case, after giving
effect thereto, no Default shall have occurred and be continuing or
(ii) the termination of the existence of any Subsidiary if the Borrower in
good faith determines that such termination is in the best interest of the
Borrower and is not materially disadvantageous to the Banks.
(j) Consummation of Spinoff. Consummate the Spinoff
no later than January 31, 1997.
(k) Payment of Obligations. Pay and discharge,
and cause each Subsidiary to pay and discharge, at or before maturity, all their
respective material obligations and liabilities (including, without limitation,
tax liabilities and claims of materialmen, warehousemen and the like which if
unpaid might by law give rise to a Lien), except where the same may be contested
in good faith by appropriate proceedings, and maintain, and cause each
Subsidiary to maintain, in accordance with generally accepted accounting
principles, appropriate reserves for the accrual of any of the same.
(l) Inspection of Property, Books and Records.
Keep, and cause each Subsidiary to keep, proper books of record and account in
which full, true and correct entries shall be made of all dealings and
transactions in relation to its business and activities; and permit, and cause
each Subsidiary to permit, representatives of any Bank at such Bank's expense
and upon reasonable prior notice to visit and inspect any of their respective
properties, to examine and make abstracts from any of their respective books and
records and to discuss their respective affairs, finances and accounts with
their respective officers, employees and independent public accountants (in
consultation with the Borrower), all at such reasonable times and as often as
may reasonably be desired.
(m) Environmental Compliance. Maintain, update
as appropriate, and implement in all material respects an environmental program
reasonably designed to: (i) ensure that the Borrower, its Subsidiaries, any of
their respective operations (including, without limitation, disposal), and any
properties owned, leased or operated by any of them, attain and remain in
substantial compliance with all applicable Environmental Laws, except to the
extent that the failure to do so would not have a Material Adverse Effect; (ii)
reasonably and prudently manage any liabilities or potential liabilities that
the Borrower, its Subsidiaries, any of their respective operations (including,
without limitation, disposal), and any properties owned or leased by any of
them, may have under all applicable Environmental Laws and may have with respect
to Hazardous Substances, except to the extent that the failure to do so would
not have a Material Adverse Effect; and (iii) ensure that the Borrower and its
Subsidiaries undertake reasonable efforts to identify, and reasonably evaluate,
issues of compliance with and liability under Environmental Laws prior to
acquiring, directly or indirectly, any ownership or leasehold interest in any
real property that could give rise to the Borrower or any of its Subsidiaries
being subjected to liability under any Environmental Law as a result of such
acquisition, except to the extent that the failure to do so would not have a
Material Adverse Effect (collectively, the "Environmental Program").
SECTION 6.2 Negative Covenants. Subject to Section 6.3, so long as
any Loan or Letter of Credit shall remain outstanding and unpaid or any Bank
shall have any Commitment hereunder, the Borrower will not, without the written
consent of the Required Banks:
(a) Liens. Create, assume or suffer to exist
or permit any Subsidiary of the Borrower to create, assume or suffer to exist
any Lien upon any of its property or assets, whether now owned or hereafter
acquired, except:
(i) Permitted Encumbrances;
(ii) any Lien on any property or asset of
the Borrower or any Subsidiary existing on the date hereof and set forth in
Schedule 6.2(a); provided that (i) such Lien shall not apply to any other
property or asset of the Borrower or any Subsidiary and (ii) such Lien shall
secure only those obligations which it secures on the date hereof and
extensions, renewals and replacements thereof that do not increase the
outstanding principal amount thereof;
(iii) any Lien existing on any property or
asset prior to the acquisition thereof by the Borrower or any Subsidiary or
existing on any property or asset of any Person that becomes a Subsidiary after
the date hereof prior to the time such Person becomes a Subsidiary; provided
that (A) such Lien is not created in contemplation of or in connection with such
acquisition or such Person becoming a Subsidiary, as the case may be, (B) such
Lien shall not apply to any other property or assets of the Borrower or any
Subsidiary and (C) such Lien shall secure only those obligations which it
secures on the date of such acquisition or the date such Person becomes a
Subsidiary, as the case may be and extensions, renewals and replacements thereof
that do not increase the outstanding principal amount thereof;
(iv) Liens on fixed or capital assets
acquired, constructed or improved by the Borrower or any Subsidiary; provided
that (A) such security interests secure Debt permitted hereunder, (B) such
security interests and the Debt secured thereby are incurred prior to or within
90 days after such acquisition or the completion of such construction or
improvement, (C) the Debt secured thereby does not exceed 80% of the cost of
acquiring, constructing or improving such fixed or capital assets and (D) such
security interests shall not apply to any other property or assets of the
Borrower or any Subsidiary;
(v) Liens incurred in connection with
any Tax Exempt Financing which do not in the aggregate materially detract from
the value of the property or assets affected thereby or materially impair the
use of such property or assets in the operation of its business;
(vi) Liens on property or assets of a
Domestic Subsidiary to secure obligations of such Subsidiary to the Borrower or
another Domestic Subsidiary; and
(vii) Liens on property or assets of
the Borrower or a Subsidiary; provided that immediately after giving effect
thereto Consolidated Secured Debt under this clause (vii) shall not exceed an
amount equal to 10% of Consolidated Tangible Net Worth.
(b) Subsidiary Debt. Permit at any time
the Debt of the Consolidated Subsidiaries (determined on a consolidated basis)
to exceed an amount equal to 10% of Consolidated Tangible Net Worth.
(c) Mergers, Etc. Merge or consolidate with
or convey, transfer or otherwise dispose of (whether in one transaction or in a
series of transactions) all or substantially all of its property or assets
(whether now owned or hereafter acquired) to, or acquire all or substantially
all of the property or assets of, any Person, or permit any of its Subsidiaries
to do so, except that (i) any Subsidiary may merge or consolidate with or into,
or transfer property or assets to, the Borrower or any Subsidiary, (ii) the
Borrower or any Subsidiary may acquire property or assets of any other
Subsidiary, (iii) the Borrower or any Subsidiary may acquire all or
substantially all of the property or assets of any other Person, and (iv) any
Subsidiary may transfer property or assets to any other Person, provided in each
case that, after giving effect to such proposed transaction, (A) no Event of
Default or event which, with the giving of notice or lapse of time, or both,
would constitute an Event of Default would exist and (b) in the case of any such
proposed transaction to which the Borrower or any Domestic Subsidiary is a
party, the Borrower or a Domestic Subsidiary is the surviving corporation, and
in the case of any such proposed transaction to which the Borrower and any
Domestic Subsidiary are parties, the Borrower is the surviving corporation,
provided, further, in the case of a transfer of property or assets from a
Subsidiary to a Person that is neither the Borrower nor a Subsidiary that (X)
the property and assets so transferred in any transaction or series of
transactions does not constitute a substantial portion of the consolidated
assets of the Borrower and its Subsidiaries determined in accordance with GAAP,
and (Y) such transfers are made on an arms' length basis.
(d) Sales, Etc. of Assets. Sell, assign or
otherwise dispose of, or permit any Subsidiary to sell, assign or otherwise
dispose of, any of its property or assets, except sales, assignments or other
dispositions (i) for cash (which in this subsection (d) shall include securities
quoted on the New York Stock Exchange or any other similar nationally quoted
exchange or any other publicly traded securities) in arm's-length transactions,
(ii) in the ordinary course of business (which in this clause (ii) shall include
the disposal of assets by means of the contribution of those assets to a joint
venture in which the Borrower or a Subsidiary participates as an equity
participant), (iii) for non-cash consideration the value of which does not
exceed $50,000,000, in the aggregate, in any period of twelve consecutive months
or (iv) in connection with a transaction permitted by subsection (c) or (g) of
this Section 6.2.
(e) ERISA. Create, assume or suffer to
exist or permit the Borrower or any ERISA Affiliate to create, assume or suffer
to exist (i) any Insufficiency of any Plan, (ii) any liability relating to an
ERISA Event or (iii) any Withdrawal Liability under any Multiemployer Plan, if
the sum of (A) any such Insufficiency, ERISA Event liability or Withdrawal
Liability, as applicable, (B) the Insufficiency of any and all other Plans, (C)
the ERISA Event liability of any and all other Plans, (D) amounts then required
to be paid to any and all other Multiemployer Plans by the Borrower or its ERISA
Affiliates as Withdrawal Liability and (E) the aggregate principal amount of all
Debt of the Borrower and all the Subsidiaries secured by Liens permitted by
clause (vii) of Section 6.2(a) shall exceed an amount equal to 10% of
Consolidated Tangible Net Worth.
(f) Restricted Payments. Declare or make
any Restricted Payment unless, after giving effect thereto, the aggregate of all
Restricted Payments declared or made subsequent to the date hereof does not
exceed the sum of (i) $17,000,000 plus (ii) 50% of Consolidated Net Income (or
minus 100% of Consolidated Net Loss) of the Borrower and its Subsidiaries for
the period from December 31, 1996 through the end of the Borrower's then most
recent fiscal quarter (treated for this purpose as a single accounting period);
provided that, in addition to Restricted Payments permitted by the foregoing,
the Borrower may purchase or redeem shares of capital stock (or options or
warrants in respect of such shares) of the Borrower (including related stock
appreciation rights or similar securities) held by present or former officers or
employees of the Borrower or any Subsidiary or by any Plan upon such person's
death, disability, retirement or termination of employment or under the terms of
any such Plan or any agreement under which such shares of stock or related
rights were issued, provided that the aggregate amount of such purchases or
redemptions that may be made pursuant to this proviso shall not exceed
$1,000,000 per fiscal year.
(g) Investments. Make or acquire, or permit
any Subsidiary to make or acquire, any Investment in any Person other than:
(i) Investments in Persons which are,
or as a result of such Investment become, Subsidiaries;
(ii) Temporary Cash Investments;
(iii) loans and advances to employees
made in the ordinary course of business consistent with prudent business
practices;
(iv) Non-cash consideration received
in connection with any sale, lease, transfer or other disposition of assets
permitted under Section 6.2(c) or (d);
(v) loans or advances in respect of Debt
permitted under Section 6.2(b)(ii);
(vi) any Investment not otherwise
permitted by the foregoing clauses of this Section 6.2(g) if, immediately after
such Investment is made or acquired, the aggregate net book value of all
Investments permitted by this clause (vi) does not exceed 25% of Consolidated
Tangible Net Worth; and
(vii) Investments in Olin resulting
from the cash management system provided for in the Transition Agreement.
(h) Transactions with Affiliates. Directly or
indirectly, pay any funds to or for the account of, make any investment (whether
by acquisition of stock or indebtedness, by loan, advance, transfer of property,
guarantee or other agreement to pay, purchase or service, directly or
indirectly, any Debt, or otherwise) in, lease, sell, transfer or otherwise
dispose of any assets, tangible or intangible, to, or participate in, or effect,
any transaction with, any Affiliate, or permit any Subsidiary to do so, except
on an arms-length basis on terms at least as favorable to the Borrower or such
Subsidiary than could have been obtained from a third party who was not an
Affiliate; provided that the foregoing provisions of this Section shall not
prohibit any such Person from making Restricted Payments permitted by Section
6.2(f).
SECTION 6.3 Olin Affirmative and Negative Covenants. Notwithstanding
Sections 6.1 and 6.2, so long as, and only so long as, Olin is the Borrower
(i.e., prior to the Spinoff Date) under this Agreement, the provisions of
Section 6.1 hereof shall be the same as Section 5.1 of the Olin Credit Agreement
and the provisions of Section 6.2 hereof shall be the same as Section 5.2 of the
Olin Credit Agreement, such Sections of the Olin Credit Agreement being set
forth in Exhibit G and incorporated herein by reference, and the capitalized
terms used in Exhibit G shall have the same meaning as in the Olin Credit
Agreement.
ARTICLE 7
EVENTS OF DEFAULT
SECTION 7.1 Events of Default. If any of the following events ("Events of
Default") shall occur and be continuing:
(a) The Borrower shall fail to pay (i) any
principal of any Loan or Reimbursement Obligation when the same becomes due and
payable or (ii) any interest on any Loan or Reimbursement Obligation or any fees
or other amounts payable under this Agreement within five days of the same
becoming due and payable; or
(b) Any representation or warranty made by the
Borrower herein or by the Borrower (or any of its officers) in connection with
this Agreement shall prove to have been incorrect in any material respect when
made; provided that any representation or warranty made by Olin herein or by
Olin (or any of its officers) in connection with this Agreement shall not be the
basis for an Event of Default subsequent to the Spinoff Date; or
(c) The Borrower shall fail to perform or
observe (i) any term, covenant or agreement contained in Section 6.1 (b), (c),
(d), (g) or (j) or Section 6.2, or (ii) any term, covenant or agreement
contained in this Agreement or any Note (other than as referred to in subsection
(a) or clause (i) above) on its part to be performed or observed if, in the case
of this clause (ii), such failure shall remain unremedied for 30 days after
written notice thereof shall have been given to the Borrower by the Agent or any
Bank; or
(d) The Borrower or any Subsidiary shall fail
to pay any installment of principal or of any premium or interest on any Debt,
which is outstanding in a principal amount of at least $10,000,000 in the
aggregate (but excluding Debt outstanding hereunder) of the Borrower or such
Subsidiary (as the case may be), when the same becomes due and payable (whether
by scheduled maturity, required prepayment, acceleration, demand or otherwise),
and such failure shall continue after the applicable grace period, if any,
specified in the agreement or instrument relating to such Debt, or any other
event shall occur or condition shall exist under any agreement or instrument
relating to any such Debt and shall continue after the applicable grace period,
if any, specified in such agreement or instrument, if the effect of such event
or condition is to accelerate; or
(e) Either the Borrower or any Significant
Subsidiary, or any two or more Subsidiaries, which (when taken together) would
have aggregate total assets constituting those of a Significant Subsidiary shall
generally not pay its debts as such debts become due, or shall admit in writing
its inability to pay its debts generally, or shall make a general assignment for
the benefit of creditors; or any proceeding shall be instituted by or against
the Borrower or any such Subsidiary seeking to adjudicate it a bankrupt or
insolvent, or seeking liquidation, winding up, reorganization, arrangement,
adjustment, protection, relief, or composition of it or its debts under any law
relating to bankruptcy, insolvency or reorganization or relief of debtors, or
seeking the entry of an order for relief or the appointment of a receiver,
trustee, or other similar official for it or for any substantial part of its
property, and, in the case of any such proceeding instituted against the
Borrower or such Subsidiary (but not instituted by it), either such proceeding
shall not be dismissed or stayed for 60 days or any of the actions sought in
such proceeding (including, without limitation, the entry of an order for relief
against it or the appointment of a trustee, custodian or other similar official
for it or any substantial part of its property) shall occur; or the Borrower or
any such Subsidiary shall take any corporate action to authorize any of the
actions set forth above in this subsection (e); or
(f) Any judgment or order for the payment of
money in excess of $5,000,000 shall be rendered against the Borrower or any
Subsidiary and either (i) enforcement proceedings shall have been commenced by
any creditor upon such judgment or order and, within 60 days of the commencement
of such proceedings, such judgment shall not have been satisfied or (subject to
clause (ii) below) shall have been stayed or (ii) there shall be any period of
60 consecutive days during which a stay of enforcement of such judgment or
order, by reason of a pending appeal or otherwise, shall not be in effect; or
(g) the occurrence of a Change of Control Date;
then, and in any such event, (A) if such event is an Event of Default specified
in paragraph (e) above with respect to the Borrower, automatically the
Commitments shall immediately terminate and the Loans hereunder (with accrued
interest thereon) and all other amounts owing under this Agreement and the Notes
(including, without limitation, all amounts of L/C Obligations, whether or not
the beneficiaries of the then outstanding Letters of Credit shall have presented
the documents required thereunder) shall immediately become due and payable, and
(B) if such event is any other Event of Default, either or both of the following
actions may be taken: (i) with the consent of the Required Banks, the Agent
may, or upon the request of the Required Banks, the Agent shall, by notice to
the Borrower declare the Commitments to be terminated forthwith, whereupon the
Commitments shall immediately terminate; (ii) with the consent of the Required
Banks, the Agent may, or upon the request of the Required Banks, the Agent
shall, by notice to the Borrower, declare the Loans hereunder (with accrued
interest thereon) and all other amounts owing under this Agreement and the Notes
(including, without limitation, all amounts of L/C Obligations, whether or not
the beneficiaries of the then outstanding Letters of Credit shall have presented
the documents required thereunder) to be due and payable forthwith, whereupon
the same shall immediately become due and payable and (iii) with the consent of
the Required Banks, the Agent may, or upon the request of the Required Banks,
the Agent shall, exercise on behalf of itself and the Banks all rights and
remedies available to it and the Banks under this Agreement and the Notes and
applicable law. With respect to all Letters of Credit with respect to which
presentment for honor shall not have occurred at the time of an acceleration
pursuant to this paragraph, the Borrower shall at such time deposit in a cash
collateral account opened by the Agent an amount equal to the aggregate then
undrawn and unexpired amount of such Letters of Credit. Amounts held in such
cash collateral account shall be applied by the Agent to the payment of drafts
drawn under such Letters of Credit, and the unused portion thereof after all
such Letters of Credit shall have expired or been fully drawn upon, if any,
shall be applied to repay other obligations of the Borrower hereunder and under
the Notes. Any amounts in such cash collateral account in excess of the sum of
all obligations of the Borrower hereunder and under the Notes and the face
amount of all Letters of Credit outstanding shall be returned to the Borrower
(or such other Person as may be lawfully entitled thereto). After all such
Letters of Credit shall have expired or been fully drawn upon, all Reimbursement
Obligations shall have been satisfied and all other obligations of the Borrower
hereunder and under the other Loan Documents shall have been paid in full, the
balance, if any, in such cash collateral account shall be returned to the
Borrower (or such other Person as may be lawfully entitled thereto).
ARTICLE 8
THE AGENT
SECTION 8.1 Appointment and Authorization. Each Bank irrevocably appoints
and authorizes the Agent to take such action as agent on its behalf and to
exercise such powers under this Agreement and the Notes as are delegated to the
Agent by the terms hereof or thereof, together with all such powers as are
reasonably incidental thereto.
SECTION 8.2 Agent and Affiliates. Morgan Guaranty Trust Company of New
York shall have the same rights and powers under this Agreement as any other
Bank and may exercise or refrain from exercising the same as though it were not
the Agent, and Morgan Guaranty Trust Company of New York and its affiliates may
accept deposits from, lend money to, and generally engage in any kind of
business with the Borrower or any Subsidiary or affiliate of the Borrower as if
it were not the Agent.
SECTION 8.3 Action by Agent. The obligation of the Agent hereunder are
only those expressly set forth herein. Without limiting the generality of the
foregoing, the Agent shall not be required to take any action with respect to
any Default, except as expressly provided in Article 7.
SECTION 8.4 Consultation with Experts. The Agent may consult with legal
counsel (who may be counsel for the Borrower), independent public accountants
and other experts selected by it and shall not be liable for any action taken or
omitted to be taken by it in good faith in accordance with the advice of such
counsel, accountants or experts.
SECTION 8.5 Liability of Agent. Neither the Agent nor any of its
affiliates nor any of their respective directors, officers, agents or employees
shall be liable for any action taken or not taken by it in connection herewith
(i) with the consent or at the request of the Required Banks (or, when expressly
required hereby, such different number of Banks required to consent to or
request such action or inaction) or (ii) in the absence of its own gross
negligence or willful misconduct. Neither the Agent nor any of its affiliates
nor any of their respective directors, officers, agents or employees shall be
responsible for or have any duty to ascertain, inquire into or verify (i) any
statement, warranty or representation made in connection with this Agreement or
any borrowing hereunder; (ii) the performance or observance of any of the
covenants or agreements of the Borrower; (iii) the satisfaction of any condition
specified in Article 4, except receipt of items required to be delivered to the
Agent; or (iv) the validity, effectiveness or genuineness of this Agreement, the
Notes or any other instrument or writing furnished in connection herewith. The
Agent shall not incur any liability by acting in reliance upon any notice,
consent, certificate, statement, or other writing (which may be a bank wire,
telex, facsimile transmission or similar writing) believed by it to be genuine
or to be signed by the property party or parties. Without limiting the
generality of the foregoing, the use of the term "agent" in this Agreement with
reference to the Agent is not intended to connote any fiduciary or other implied
(or express) obligations arising under agency doctrine of any applicable law.
Instead, such term is used merely as a matter of market custom and is intended
to create or reflect only an administrative relationship between independent
contracting parties.
SECTION 8.6 Indemnification. Each Bank shall, ratably in accordance with
its Commitment Percentage, indemnify the Agent, its affiliates and their
respective directors, officers, agents and employees (to the extent not
reimbursed by the Borrower) against any cost, expense (including counsel fees
and disbursements), claim, demand, action, loss or liability (except such as
result from such indemnitees' gross negligence or willful misconduct) that such
indemnitees may suffer or incur in connection with this Agreement or any action
taken or omitted by such indemnitees hereunder.
SECTION 8.7 Credit Decision. Each Bank acknowledges that it has,
independently and without reliance upon the Agent or any other Bank, and based
on such documents and information as it has deemed appropriate, made its own
credit analysis and decision to enter into this Agreement. Each Bank also
acknowledges that it will, independently and without reliance upon the Agent or
any other Bank, and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking any action under this Agreement.
SECTION 8.8 Successor Agent. The Agent may resign at any time by giving
notice thereof to the Banks and the Borrower. Upon any such resignation, the
Required Banks shall have the right to appoint a successor Agent with the
reasonable consent of the Borrower. If no successor Agent shall have been so
appointed by the Required Banks, and shall have accepted such appointment,
without 30 days after the retiring Agent gives notice of resignation, then the
retiring Agent may, on behalf of the Banks, appoint a successor Agent, which
shall be a commercial bank organized or licensed under the laws of the United
States or of any State thereof and having a combined capital and surplus of at
least $100,000,000. Upon the acceptance of its appointment as Agent hereunder
by a successor Agent, such successor Agent shall thereupon succeed to and become
vested with all the right and duties of the retiring Agent, and the retiring
Agent shall be discharged from its duties and obligations hereunder. After any
retiring Agent's resignation hereunder as Agent, the provisions of this Article
shall inure to its benefit as to any actions taken or omitted to be taken by it
while it was Agent.
SECTION 8.9 Agent's Fee. The Borrower shall pay to the Agent for its own
account fees in the amounts and at the times previously agreed upon between the
Borrower and the Agent.
ARTICLE 9
CHANGE IN CIRCUMSTANCES
SECTION 9.1 Basis for Determining Interest Rate Inadequate or Unfair. If
on or prior to the first day of any Interest Period for any CD Loan, Euro-Dollar
Loan or Money Market LIBOR Loan:
(a) the Agent is advised by the Reference Banks
that deposits in dollars (in the applicable amounts) are not being offered to
the Reference Banks in the relevant market for such Interest Period, or
(b) in the case of CD Loans or Euro-Dollar Loans,
Banks having 50% or more of the aggregate principal amount of the affected Loans
advise the Agent that the Adjusted CD Rate or the London Interbank Offered Rate,
as the case may be, as determined by the Agent will not adequately and fairly
reflect the cost to such Banks of funding their CD Loans or Euro-Dollar Loans,
as the case may be, for such Interest Period,
the Agent shall forthwith give notice thereof to the Borrower and the Banks,
whereupon until the Agent notifies the Borrower that the circumstances giving
rise to such suspension no longer exist, (i) the obligations of the Banks to
make CD Loans or Euro-Dollar Loans, as the case may be, or to continue or
convert outstanding Loans as or into CD Loans or Euro-Dollar Loans, as the case
may be, shall be suspended and (ii) each outstanding CD Loan or Euro-Dollar
Loan, as the case may be, shall be converted into a Base Rate Loan on the last
day of the then current Interest Period applicable thereto. Unless the Borrower
notifies the Agent at least two Domestic Business Days before the date of any
Fixed Rate Borrowing for which a Notice of Borrowing has previously been given
that it elects not to borrow on such date, (i) if such Fixed Rate Borrowing is a
Committed Borrowing, such Borrowing shall instead be made as a Base Rate
Borrowing and (ii) if such Fixed Rate Borrowing is a Money Market LIBOR
Borrowing, the Money Market LIBOR Loans comprising such Borrowing shall bear
interest for each day from and including the first day to but excluding the last
day of the Interest Period applicable thereto at the Base Rate for such day.
SECTION 9.2 Illegality. If, on or after the date of this Agreement, the
adoption of any applicable law, rule or regulation, or any change in any
applicable law, rule or regulation, or any change in the interpretation or
administration thereof by any governmental authority, central bank or comparable
agency charged with the interpretation or administration thereof, or compliance
by any Bank (or its Euro-Dollar Lending Office) with any request or directive
(whether or not having the force of law) of any such authority, central bank or
comparable agency shall make it unlawful or impossible for any Bank (or its
Euro-Dollar Lending Office) to make, maintain or fund its Euro-Dollar Loans
and such Bank shall so notify the Agent, the Agent shall forthwith give notice
thereof to the other Banks and the Borrower, whereupon until such Bank notifies
the Borrower and the Agent that the circumstances giving rise to such suspension
no longer exist, the obligation of such Bank to make Euro-Dollar Loans, or to
convert outstanding Loans into Euro-Dollar Loans, shall be suspended. Before
giving any notice to the Agent pursuant to this Section, such Bank shall
designate a different Euro-Dollar Lending Office if such designation will avoid
the need for giving such notice and will not, in the judgment of such Bank, be
otherwise disadvantageous to such Bank. If such notice is given, each Euro-
Dollar Loan of such Bank then outstanding shall be converted to a Base Rate Loan
either (a) on the last day of the then current Interest Period applicable to
such Euro-Dollar Loan if such Bank may lawfully continue to maintain and fund
such Loan to such day or (b) immediately if such Bank shall determine that it
may not lawfully continue to maintain and fund such Loan to such day.
SECTION 9.3 Increased Cost and Reduced Return. (a) If on or after
(x) the date hereof, in the case of any Committed Loan or Letter of Credit or
any obligation to make Committed Loans or issue or participate in Letters of
Credit or (y) the date of the related Money Market Quote, in the case of any
Money Market Loan, the adoption of any applicable law, rule or regulation, or
any change in any applicable law, rule or regulation, or any change in the
interpretation or administration thereof by any governmental authority, central
bank or comparable agency charged with the interpretation or administration
thereof, or compliance by any Bank (or its Applicable Lending Office) with any
request or directive (whether or not having the force of law) of any such
authority, central bank or comparable agency shall impose, modify or deem
applicable any reserve (including, without limitation, any such requirement
imposed by the Board of Governors of the Federal Reserve System, but excluding
(i) with respect to any CD Loan any such requirement included in an applicable
Domestic Reserve Percentage and (ii) with respect to any Euro-Dollar Loan any
such requirement with respect to which such Bank is entitled to compensation
during the relevant Interest Period under Section 2.16), special deposit,
insurance assessment (excluding, with respect to any CD Loan, any such
requirement reflected in an applicable Assessment Rate) or similar requirement
against assets of, deposits with or for the account of, or credit extended by,
any Bank (or its Applicable Lending Office) or shall impose on any Bank (or its
Applicable Lending Office) or on the United States market for certificates of
deposit or the London interbank market any other condition affecting its Fixed
Rate Loans, its Note or its obligation to make Fixed Rate Loans or issue or
participate in Letters of Credit and the result of any of the foregoing is to
increase the cost to such Bank (or its Applicable Lending Office) of making or
maintaining any Fixed Rate Loan or issuing or participating in any Letter of
Credit, or to reduce the amount of any sum received or receivable by such Bank
(or its Applicable Lending Office) under this Agreement or under its Note with
respect thereto, by an amount deemed by such Bank to be material, then, within
15 days after demand by such Bank (with a copy to the Agent), the Borrower shall
pay to such Bank such additional amount or amounts as will compensate such Bank
for such increased cost or reduction.
(b) If any Bank shall have determined that,
after the date hereof, the adoption of any applicable law, rule or regulation
regarding capital adequacy, or any change in any such law, rule or regulation,
or any change in the interpretation or administration thereof by any
governmental authority, central bank or comparable agency charged with the
interpretation or administration thereof, or any request or directive regarding
capital adequacy (whether or not having the force of law) of any such authority,
central bank or comparable agency, has or would have the effect of reducing the
rate of return on capital of such Bank (or its Parent) as a consequence of such
Bank's obligations hereunder to a level below that which such Bank (or its
Parent) could have achieved but for such adoption, change, request or directive
(taking into consideration its policies with respect to capital adequacy) by an
amount deemed by such Bank to be material, then from time to time, within 15
days after demand by such Bank (with a copy to the Agent), the Borrower shall
pay to such Bank such additional amount or amounts as will compensate such Bank
(or its Parent) for such reduction.
(c) Each Bank will promptly notify the Borrower
and the Agent of any event of which it has knowledge (and in any case no later
than six months after such event shall have occurred), occurring after the date
hereof, which will entitle such Bank to compensation pursuant to this Section
and will designate a different Applicable Lending Office if such designation
will avoid the need for, or reduce the amount of, such compensation and will
not, in the judgment of such Bank, be otherwise disadvantageous to such Bank. A
certificate of any Bank claiming compensation under this Section and setting
forth in reasonable detail the computation of the additional amount or amounts
to be paid to it hereunder shall be conclusive in the absence of manifest error.
In determining such amount, such Bank may use any reasonable averaging and
attribution methods.
SECTION 9.4 Taxes. (a) For the purposes of this Section 9.4, the
following terms have the following meanings:
"Taxes" means any and all present or future taxes, duties, levies,
imposts, deductions, charges or withholdings with respect to any payment by the
Borrower pursuant to this Agreement or under any Note, and all liabilities with
respect thereto, excluding (i) in the case of each Bank and the Agent, taxes
imposed on its net income by the United States, and income or franchise taxes
imposed on it by any jurisdiction in which it is doing business or deemed to be
doing business (other than because of its entering into this Agreement, making
any Loan or receiving any payments or enforcing any rights under this Agreement
or any Note) and (ii) in the case of each Bank, any United States withholding
tax imposed on such payments but only to the extent that such Bank is subject to
United States withholding tax at the time such Bank first becomes a party to
this Agreement except to the extent such Bank's transferor (if any) was entitled
at the time of transfer to receive additional amounts with respect to such
withholding pursuant to Section 9.4(b).
"Other Taxes" means any present or future stamp or documentary taxes
and any other excise or property taxes, or similar taxes, charges or levies
arising from the execution, holding or delivery of this Agreement or any Note.
(a)
(b) Any and all payments by the Borrower to or
for the account of any Bank or the Agent hereunder or under any Note shall be
made without deduction for any Taxes or Other Taxes; provided that, if the
Borrower shall be required by law to deduct any Taxes or Other Taxes from any
such payments, (i) the sum payable shall be increased as necessary so that after
making all required deductions (including deductions applicable to additional
sums payable under this Section) such Bank or the Agent (as the case may be)
receives an amount equal to the sum it would have received had no such
deductions been made, (ii) the Borrower shall make such deductions, (iii) the
Borrower shall pay the full amount deducted to the relevant taxation authority
or other authority in accordance with applicable law and (iv) the Borrower shall
furnish to the Agent, at its address referred to in Section 10.1, the original
or a certified copy of a receipt evidencing payment thereof or other evidence of
payment reasonably satisfactory to the Agent.
(c) The Borrower agrees to indemnify each
Bank and the Agent for the full amount of Taxes or Other Taxes (including,
without limitation, any Taxes imposed or asserted on amounts payable under this
Section) paid by such Bank or the Agent (as the case may be) and any penalties,
interest and reasonable expenses arising therefrom or with respect thereto.
This indemnification shall be paid within 15 days after such Bank or the Agent
(as the case may be) makes written demand therefor.
(d) Each Bank organized under the laws of a
jurisdiction outside the United States, on or prior to the date of its execution
and delivery of this Agreement in the case of each Bank listed on the signature
pages hereof and on or prior to the date on which it becomes a Bank in the case
of each other Bank, and from time to time thereafter if requested in writing by
the Borrower (but only if such Bank is or remains lawfully able to do so), shall
provide the Borrower and the Agent with Internal Revenue Service Form 1001 or
4224, as appropriate, or any successor form prescribed by the Internal Revenue
Service, certifying that such Bank is entitled to benefits under an income tax
treaty to which the United States is a party which exempts the Bank from United
States withholding tax or reduces the rate of withholding tax on payments of
interest for the account of such Bank or certifying that the income receivable
pursuant to this Agreement is effectively connected with the conduct of a trade
or business in the United States.
(e) For any period with respect to which a Bank
has failed to provide the Borrower or the Agent with the appropriate form
pursuant to Section 9.4(d) (unless such failure is due to a change in treaty,
law or regulation occurring subsequent to the date on which such form originally
was required to be provided), such Bank shall not be entitled to indemnification
under Section 9.4(b) or (c) with respect to Taxes imposed by the United States;
provided that if a Bank, which is otherwise exempt from or entitled to a reduced
rate of withholding tax, becomes subject to Taxes because of its failure to
deliver a form required hereunder, the Borrower shall take such steps as such
Bank shall reasonably request to assist such Bank to recover such Taxes.
(f) If the Borrower is required to pay additional
amounts to or for the account of any Bank pursuant to this Section, then: (i)
such Bank will change the jurisdiction of its Applicable Lending Office if, in
the judgment of such Bank, such change (x) will eliminate or reduce any such
additional payment that may thereafter accrue and (y) is not otherwise
disadvantageous to such Bank and (ii) if the Taxes or Other Taxes giving rise to
the payment of such additional amounts are, in the good-faith judgment of both
such Bank and the Borrower, refundable under applicable law, such Bank shall,
upon the Borrower's written request and at its expense, take such action
(including the filing and prosecution of a claim for refund) as may be required
to obtain a refund of such Taxes or Other Taxes and shall pay over any such
refund received (together with any interest paid thereon) to the Borrower within
15 days after receipt thereof.
SECTION 9.5 Base Rate Loans Substituted for Affected Fixed Rate Loans. If
(i) the obligation of any Bank to make, or convert outstanding Loans to, Euro-
Dollar Loans has been suspended pursuant to Section 9.2 or (ii) any Bank has
demanded compensation under Section 9.3 or 9.4 with respect to its CD Loans or
Euro-Dollar Loans and the Borrower shall, by at least five Euro-Dollar Business
Days' prior notice to such Bank through the Agent, have elected that the
provisions of this Section shall apply to such Bank, then, unless and until such
Bank notifies the Borrower that the circumstances giving rise to such suspension
or demand for compensation no longer exist:
(a) all Loans which would otherwise be made
by such Bank as (or continued as or converted into) CD Loans or Euro-Dollar
Loans, as the case may be, shall instead be Base Rate Loans (on which interest
and principal shall be payable contemporaneously with the related Fixed Rate
Loans of the other Banks); and
(b) after each of its CD Loans or Euro-Dollar
Loans, as the case may be, has been repaid (or converted to a Base Rate Loan),
all payments of principal which would otherwise be applied to repay such Fixed
Rate Loans shall be applied to repay its Base Rate Loans instead.
If such Bank notifies the Borrower that the circumstances giving rise to such
notice no longer apply, the principal amount of each such Base Rate Loan shall
be converted into a CD Loan or Euro-Dollar Loan, as the case may be, on the
first day of the next succeeding Interest Period applicable to the related CD
Loans or Euro-Dollar Loans of the other Banks.
ARTICLE 10
MISCELLANEOUS
SECTION 10.1 Notices. All notices, requests and other communications to
any party hereunder shall be in writing (including bank wire, telex, facsimile
transmission or similar writing) and shall be given to such party: (a) in the
case of the Borrower or the Agent, at its address, facsimile number or telex
number set forth on the signature pages hereof, (b) in the case of any Bank, at
its address, facsimile number or telex number set forth in its Administrative
Questionnaire or (c) in the case of any party, such other address, facsimile
number or telex number as such party may hereafter specify for the purpose by
notice to the Agent and the Borrower. Each such notice, request or other
communication shall be effective (i) if given by telex, when such telex is
transmitted to the telex number specified in this Section and the appropriate
answerback is received, (ii) if given by facsimile transmission, when
transmitted to the facsimile number specified in this Section and confirmation
of receipt is received, (iii) if given by mail, 72 hours after such
communication is deposited in the mails with first class postage prepaid,
addressed as aforesaid or (iv) if given by any other means, when delivered at
the address specified in this Section; provided that notices to the Agent under
Article 2 or Article 9 shall not be effective until received.
SECTION 10.2 No Waivers. No failure or delay by the Agent or any Bank in
exercising any right, power or privilege hereunder or under any Note shall
operate as a waiver thereof nor shall any single or partial exercise thereof
preclude any other or further exercise thereof or the exercise of any other
right, power or privilege. The rights and remedies herein provided shall be
cumulative and not exclusive of any rights or remedies provided by law.
SECTION 10.3 Expenses; Indemnification. (a) The Borrower shall pay (i)
all reasonable out-of-pocket expenses of the Agent, including reasonable fees
and disbursements of special counsel for the Agent, in connection with the
preparation and administration of this Agreement, any waiver or consent
hereunder or any amendment hereof or any Default or alleged Default hereunder
and (ii) if an Event of Default occurs, all out-of-pocket expenses incurred by
the Agent and each Bank, including (without duplication) the fees and
disbursements of outside counsel, in connection with such Event of Default and
collection, bankruptcy, insolvency and other enforcement proceedings resulting
therefrom.
(b) The Borrower agrees to indemnify the Agent
and each Bank, their respective affiliates and the respective directors,
officers, agents and employees of the foregoing (each an "Indemnitee") and hold
each Indemnitee harmless from and against any and all liabilities, losses,
damages, costs and expenses of any kind, including, without limitation, the
reasonable fees and disbursements of counsel, which may be incurred by such
Indemnitee in connection with any investigative, administrative or judicial
proceeding (whether or not such Indemnitee shall be designated a party thereto)
brought or threatened relating to or arising out of this Agreement or any actual
or proposed use of proceeds of Loans hereunder; provided that no Indemnitee
shall have the right to be indemnified hereunder for such Indemnitee's own gross
negligence or willful misconduct as determined by a court of competent
jurisdiction.
SECTION 10.4 Sharing of Set-Offs. Each Bank agrees that if it shall, by
exercising any right of set-off or counterclaim or otherwise, receive payment of
a proportion of the aggregate amount of principal and interest due with respect
to any Note held by it which is greater than the proportion received by any
other Bank in respect of the aggregate amount of principal and interest due with
respect to any Note held by such other Bank, the Bank receiving such
proportionately greater payment shall purchase such participations in the Notes
held by the other Banks, and such other adjustments shall be made, as may be
required so that all such payments of principal and interest with respect to the
Notes held by the Banks shall be shared by the Banks pro rata; provided that
nothing in this Section shall impair the right of any Bank to exercise any right
of set-off or counterclaim it may have and to apply the amount subject to such
exercise to the payment of indebtedness of the Borrower other than its
indebtedness hereunder. The Borrower agrees, to the fullest extent it may
effectively do so under applicable law, that any holder of a participation in a
Note, whether or not acquired pursuant to the foregoing arrangements, may
exercise rights of set-off or counterclaim and other rights with respect to such
participation as fully as if such holder of a participation were a direct
creditor of the Borrower in the amount of such participation.
SECTION 10.5 Amendments and Waivers. Any provision of this Agreement or
the Notes may be amended or waived if, but only if, such amendment or waiver is
in writing and is signed by the Borrower and the Required Banks (and, if the
rights or duties of the Agent are affected thereby, by the Agent); provided that
no such amendment or waiver shall, unless signed by each affected Bank, (i)
increase or decrease the Commitment of any Bank (except for a ratable decrease
in the Commitments of all Banks) or subject any Bank to any additional
obligation, (ii) reduce the principal of or rate of interest on any Loan or the
amount of any L/C Obligation or any fees hereunder, (iii) postpone the date
fixed for any payment of principal of or interest on any Loan or any L/C
Obligation or any fees hereunder or for the termination of any Commitment, (iv)
change the aggregate amount of Loans required to be repaid on any date or (v)
change the percentage of the Commitments or of the aggregate unpaid principal
amount of the Notes, or the number of Banks, which shall be required for the
Banks or any of them to take any action under this Section or any other
provision of this Agreement.
SECTION 10.6 Successors and Assigns. (a) The provisions of this
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and assigns, except that the Borrower may not
assign or otherwise transfer any of its rights or obligations under this
Agreement without the prior written consent of all Banks.
(b) Any Bank may at any time grant to one
or more banks or other institutions (each a "Participant") participating
interests in its Commitment or any or all of its Loans and L/C Obligations. In
the event of any such grant by a Bank of a participating interest to a
Participant, whether or not upon notice to the Borrower and the Agent, such Bank
shall remain responsible for the performance of its obligations hereunder, and
the Borrower and the Agent shall continue to deal solely and directly with such
Bank in connection with such Bank's rights and obligations under this Agreement.
Any agreement pursuant to which any Bank may grant such a participating interest
shall provide that such Bank shall retain the sole right and responsibility to
enforce the obligations of the Borrower hereunder including, without limitation,
the right to approve any amendment, modification or waiver of any provision of
this Agreement; provided that such participation agreement may provide that such
Bank will not agree to any modification, amendment or waiver of this Agreement
described in clause (i), (ii), (iii), or (iv) of Section 10.5 without the
consent of the Participant. The Borrower agrees that each Participant shall, to
the extent provided in its participation agreement, be entitled to the benefits
of Article 9 with respect to its participating interest. An assignment or other
transfer which is not permitted by subsection (c) or (d) below shall be given
effect for purposes of this Agreement only to the extent of a participating
interest granted in accordance with this subsection (b). If the Participant is
not incorporated under the laws of the United States or a state thereof, it
shall so notify the Borrower and the Agent and shall comply with Section 9.4(d)
as if it were a Bank on and after the date on which it becomes a Participant.
(c) Any Bank may at any time assign to one or
more banks or other institutions (each an "Assignee") all, or a proportionate
part (equivalent to an initial Commitment of not less than $10,000,000) of all,
of its rights and obligations under this Agreement and the Notes, and such
Assignee shall assume such rights and obligations, pursuant to an Assignment and
Assumption Agreement in substantially the form of Exhibit F hereto executed by
such Assignee and such transferor Bank, with (and subject to) the subscribed
consent of the Borrower, which may be withheld in the Borrower's sole
discretion, and the Agent and the Issuing Bank (which consent may not be
unreasonably withheld); provided that if an Assignee is an affiliate of such
transferor Bank or was a Bank immediately prior to such assignment, no such
consent shall be required; and provided further that such assignment may, but
need not, include rights of the transferor Bank in respect of outstanding Money
Market Loans. Upon execution and delivery of such instrument and payment by
such Assignee to such transferor Bank of an amount equal to the purchase price
agreed between such transferor Bank and such Assignee, such Assignee shall be a
Bank party to this Agreement and shall have all the rights and obligations of a
Bank with a Commitment as set forth in such instrument of assumption, and the
transferor Bank shall be released from its obligations hereunder to a
corresponding extent, and no further consent or action by any party shall be
required. Upon the consummation of any assignment pursuant to this subsection
(c), the transferor Bank, the Agent and the Borrower shall make appropriate
arrangements so that, if required, a new Note is issued to the Assignee. In
connection with any such assignment, the transferor Bank shall pay to the Agent
an administrative fee for processing such assignment in the amount of $2,500.
If the Assignee is not incorporated under the laws of the United States or a
state thereof, it shall so notify the Borrower and the Agent and shall comply
with Section 9.4(d) on and after the date on which it becomes an Assignee.
(d) Any Bank may at any time assign all or any
portion of its rights under this Agreement and its Note to a Federal Reserve
Bank. No such assignment shall release the transferor Bank from its obligations
hereunder.
(e) Each Assignee and Participant shall be
entitled to the benefit of Section 9.3 and 9.4 but shall not be entitled to
receive any greater payment under such Sections than the transferor Bank would
have been entitled to receive with respect to the rights transferred, unless
such transfer is made with the Borrower's prior written consent or at a time
when the circumstances giving rise to such greater payment did not exist.
SECTION 10.7 Information. Any Bank may, in connection with any assignment
or participation or proposed assignment or participation pursuant to this
Article 10, disclose to the assignee or participant or proposed assignee or
participant, any information relating to the Borrower furnished to such Bank by
or on behalf of the Borrower.
SECTION 10.8 Assignment to Primex; Release. Notwithstanding Section 10.6
hereof, on the Spinoff Date, all rights, liabilities and obligations of Olin
under this Agreement and under the Morgan Letters will automatically, and
without further act of the parties hereto, be assigned and delegated to Primex,
and Primex will automatically assume all such rights, liabilities and
obligations in full, including without limitation the obligation to pay the
principal of and all interest on any outstanding Notes, Loans or Letters of
Credit hereunder, all fees and all other amounts from time to time owing
hereunder, whether such Loans shall have been made or Letters of Credit issued,
or such interest, fees or other amounts shall have accrued, prior to or after
the date of such assignment, delegation and assumption. Such assignment,
delegation and assumption shall be effective as of the Spinoff Date. At the
time of such assignment, delegation and assumption, Olin will be automatically
released from any and all obligations, claims and liabilities whatsoever,
whether paid or unpaid, accrued or unaccrued, known or unknown, fixed or
contingent, or otherwise, under this Agreement or arising in connection herewith
(including the Morgan Letters) and on any Notes, Loans or Letters of Credit
hereunder, and from and after such time Primex will be the "Borrower" and sole
obligor hereunder. On or immediately following the Spinoff Date, Primex shall
deliver to the Agent (or its counsel) an originally executed Note for each Bank
dated the Spinoff Date and such Bank shall within 14 days thereafter return to
Olin marked "cancelled" any Notes previously delivered by Olin.
SECTION 10.9 Collateral. Each of the Banks represents to the Agent and
each of the other Banks that it in good faith is not relying upon any "margin
stock" (as defined in
Regulation U) as collateral in the extension or maintenance of the credit
provided for in this Agreement.
SECTION 10.10 Governing Law; Submission to Jurisdiction. This Agreement
and each Note shall be governed by and construed in accordance with the laws of
the State of New York. The Borrower hereby submits to the nonexclusive
jurisdiction of the United States District Court for the Southern District of
New York and of any New York State court sitting in New York City for purposes
of all legal proceedings arising out of or relating to this Agreement or the
transactions contemplated hereby. The Borrower irrevocably waives, to the
fullest extent permitted by law, any objection which it may now or hereafter
have to the laying of the venue of any such proceeding brought in such a court
and any claim that any such proceeding brought in such a court has been brought
in an inconvenient forum.
SECTION 10.11 Counterparts; Integration; Effectiveness. This Agreement
may be signed in any number of counterparts, each of which shall be an original,
with the same effect as if the signatures thereto and hereto were upon the same
instrument. This Agreement (including the Notes and any Applications)
constitutes the entire agreement and understanding among the parties hereto and
supersedes any and all prior agreements and understandings, oral or written,
relating to the subject matter hereof. This Agreement shall become effective
upon receipt by the Agent of counterparts hereof signed by each of the parties
hereto (or, in the case of any party as to which an executed counterpart shall
not have been received, receipt by the Agent in form satisfactory to it of
telegraphic, telex, facsimile or other written confirmation from such party of
execution of a counterpart hereof by such party).
SECTION 10.12 WAIVER OF JURY TRIAL. EACH OF THE BORROWER, THE AGENT AND
THE BANKS HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY
LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE
TRANSACTIONS CONTEMPLATED HEREBY.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed by their respective authorized officers as of the day and year
first above written.
OLIN CORPORATION
By: J.M. Pierpont
Name: J.M. Pierpont
Title: Vice President & Treasurer
Address: 501 Merritt 7, Norwalk, CT 06851
Telex: None
Facsimile: (203) 750-3231
PRIMEX TECHNOLOGIES, INC.
By: J.M. Pierpont
Name: J.M. Pierpont
Title: Treasurer
Address: 10101 9th St. N.
St. Petersburg, FL 33716
Telex: None
Facsimile: (813) 578-8353
MORGAN GUARANTY TRUST COMPANY
OF NEW YORK, as Agent
By Sandra J.S. Kurek
Name: Sandra J.S. Kurek
Title: Associate
Address: 60 Wall Street
New York, NY 10260-0060
Telex:
Facsimile:
Commitments
$28,000,000 MORGAN GUARANTY TRUST COMPANY
OF NEW YORK
By Sandra J.S. Kurek
Name: Sandra J.S. Kurek
Title: Associate
$24,000,000 WACHOVIA BANK OF GEORGIA, N.A.
By Patrick A. Phelan
Name: Patrick A. Phelan
Title: Assistant Vice President
$18,000,000 THE BANK OF NEW YORK
By David C. Siegel
Name: David C. Siegel
Title: Assistant Vice President
$18,000,000 THE BANK OF NOVA SCOTIA
By Frank F. Sandler
Name: Frank F. Sandler
Title: Relationship Manager
$18,000,000 MELLON BANK, N.A.
By George B. Davis
Name: George B. Davis
Title: Vice President
$18,000,000 NATIONSBANK, N.A. (South)
By Andrew M. Airheart
Name: Andrew M. Airheart
Title: Senior Vice President
$18,000,000 PNC-BANK, KENTUCKY, INC.
By James D. Neil
Name: James D. Neil
Title: Vice President
$18,000,000 SUNTRUST BANK, TAMPA BAY
By Ronald K. Rueve
Name: Ronald K. Rueve
Title: Vice President
Total Commitments
$160,000,000.00
===============
EXHIBITS
EXHIBIT A
NOTE
New York, New York
[ ], 1996
For value received, [OLIN CORPORATION, a Virginia corporation (prior
to the Spinoff described in the Credit Agreement referred to below,] [PRIMEX
TECHNOLOGIES, INC., a Virginia corporation (from and after the Spinoff,] the
"Borrower"), promises to pay to the order of [ ] (the "Bank"), for the
account of its Applicable Lending Office, the unpaid principal amount of each
Loan made by the Bank to the Borrower pursuant to the Credit Agreement referred
to below on the maturity date provided for in the Credit Agreement. The
Borrower promises to pay interest on the unpaid principal amount of each such
Loan on the dates and at the rate or rates provided for in the Credit Agreement.
All such payments of principal and interest shall be made in lawful money of the
United States in Federal or other immediately available funds at the office of
Morgan Guaranty Trust Company of New York, 60 Wall Street, New York, New York.
All Loans made by the Bank, the respective types thereof and all
repayments of the principal thereof shall be recorded by the Bank and, if the
Bank so elects in connection with any transfer or enforcement hereof,
appropriate notations to evidence the foregoing information with respect to each
such Loan then outstanding may be endorsed by the Bank on the schedule attached
hereto, or on a continuation of such schedule attached to and made a part
hereof; provided that the failure of the Bank to make any such recordation or
endorsement shall not affect the obligations of the Borrower hereunder or under
the Credit Agreement.
This Note is one of the Notes referred to in the Credit Agreement
dated as of December 23, 1996 among OLIN CORPORATION, PRIMEX TECHNOLOGIES, INC.,
the Banks parties thereto and Morgan Guaranty Trust Company of New York, as
Agent (as the same may be amended from time to time, the "Credit Agreement").
Terms defined in the Credit Agreement are used herein with the same meanings.
Reference is made to the Credit Agreement for provisions for the prepayment
hereof and the acceleration of the maturity hereof.
[As provided in Section 10.8 of the Credit Agreement, on the Spinoff
Date, all obligations of the Borrower under this Note shall be automatically
delegated to and assumed by Primex Technologies, Inc., and Olin Corporation
shall be automatically released therefrom.]*/ [FN: To be included only in the
Notes executed by Olin.]
[OLIN CORPORATION
By:
Name:
Title:]
[PRIMEX TECHNOLOGIES, INC.
By:
Name:
Title:]
LOANS AND PAYMENTS OF PRINCIPAL
- -----------------------------------------------------------------
Amount Type Amount of
of of Principal Notation
Date Loan Loan Repaid Made By
- -----------------------------------------------------------------
- -----------------------------------------------------------------
- -----------------------------------------------------------------
- -----------------------------------------------------------------
- -----------------------------------------------------------------
- -----------------------------------------------------------------
- -----------------------------------------------------------------
- -----------------------------------------------------------------
- -----------------------------------------------------------------
- -----------------------------------------------------------------
- -----------------------------------------------------------------
- -----------------------------------------------------------------
EXHIBIT B
Form of Money Market Quote Request
[Date]
To: Morgan Guaranty Trust Company of New York (the "Agent")
From: <NAME OF BORROWER>
Re: Credit Agreement (the "Credit Agreement") dated as of
December 23, 1996 among OLIN CORPORATION, PRIMEX TECHNOLOGIES,
INC., the Banks parties thereto and the Agent
We hereby give notice pursuant to Section 2.3 of the Credit Agreement
that we request Money Market Quotes for the following proposed Money Market
Borrowing(s):
Date of Borrowing: __________________
Principal Amount/1 Interest Period1/
$
Such Money Market Quotes should offer a Money Market [Margin]
[Absolute Rate]. [The applicable base rate is the London Interbank Offered
Rate.]
Terms used herein have the meanings assigned to them in the Credit
Agreement.
<NAME OF BORROWER>
By________________________
Name:
Title:
[FN/1: Not less than one month (LIBOR Auction] or not less than 7 days
(Absolute Rate Auction), subject to the provisions of the definition of Interest
Period.]
EXHIBIT C
Form of Invitation for Money Market Quotes
To: [Name of Bank]
Re: Invitation for Money Market Quotes to [Name of Borrower] (the
"Borrower")
Pursuant to Section 2.3 of the Credit Agreement dated as of
December 23, 1996 among OLIN CORPORATION, PRIMEX TECHNOLOGIES, INC., the Banks
parties thereto and the undersigned, as Agent, we are pleased on behalf of the
Borrower to invite you to submit Money Market Quotes to the Borrower for the
following proposed Money Market Borrowing(s):
Date of Borrowing: [ ]
Principal Amount Interest Period
$
Such Money Market Quotes should offer a Money Market [Margin]
[Absolute Rate]. [The applicable base rate is the London Interbank Offered
Rate.]
Please respond to this invitation by no later than [2:00 P.M.] [9:30
A.M.] (New York City time) on [date].
MORGAN GUARANTY TRUST COMPANY
OF NEW YORK, as Agent
By
Authorized Officer
Form of Money Market Quote
To: Morgan Guaranty Trust Company of New York, as Agent
Re: Money Market Quote to [Name of Borrower] (the "Borrower")
In response to your invitation on behalf of the Borrower dated [
], 19[ ], we hereby make the following Money Market Quote on the following
terms:
1. Quoting Bank: [ ]
2. Person to contact at Quoting Bank:
[ ]
3. Date of Borrowing: [ ]*
4. We hereby offer to make Money Market Loan(s) in the following principal
amounts, for the following Interest Periods and at the following
rates:
Principal Interest Money Market
Amount** Period*** [Margin****] [Absolute Rate*****]
$
$
[Provided, that the aggregate principal amount of Money Market Loans for
which the above offers may be accepted shall not exceed $[ ].]**
We understand and agree that the offer(s) set forth above,
subject to the satisfaction of the applicable conditions set forth in the
Credit Agreement dated as of December 23, 1996 among OLIN CORPORATION,
PRIMEX TECHNOLOGIES, INC., the Banks parties thereto and yourselves, as
Agent, irrevocably obligates us to make the Money Market Loan(s) for which
any offer(s) are accepted, in whole or in part.
Very truly yours,
[NAME OF BANK]
Dated: By:
Authorized Officer
- ---------------
* As specified in the related Invitation.
** Principal amount bid for each Interest Period may not exceed principal
amount requested. Specify aggregate limitation if the sum of the
individual offers exceeds the amount the Bank is willing to lend. Bids
must be made for $5,000,000 or a larger multiple of $1,000,000.
*** Not less than one month or not less than 30 days, as specified in the
related Invitation. No more than five bids are permitted for each Interest
Period.
**** Margin over or under the London Interbank Offered Rate determined for
the applicable Interest Period. Specify percentage (to the nearest
1/10,000 of 1%) and specify whether "PLUS" or "MINUS".
***** Specify rate of interest per annum (to the nearest
1/10,000th of 1%).
EXHIBIT E
OPINION OF
COUNSEL FOR THE BORROWER
EXHIBIT F
ASSIGNMENT AND ASSUMPTION AGREEMENT
AGREEMENT dated as of [ ], 19[ ] among <NAME OF ASSIGNOR>
(the "Assignor"), <NAME OF ASSIGNEE> (the "Assignee"), <NAME OF BORROWER> (the
"Borrower") and MORGAN GUARANTY TRUST COMPANY OF NEW YORK, as Agent (the
"Agent").
WHEREAS, this Assignment and Assumption Agreement (the "Agreement")
relates to the Credit Agreement dated as of December 23, 1996 among the
Borrower, the Assignor and the other Banks parties thereto, as Banks, and the
Agent (the "Credit Agreement");
WHEREAS, as provided under the Credit Agreement, the Assignor has a
Commitment to make Loans to the Borrower in an aggregate principal amount at any
time outstanding not to exceed $[ ];
WHEREAS, Committed Loans made to the Borrower by the Assignor under
the Credit Agreement in the aggregate principal amount of $[ ] are
outstanding at the date hereof; and
WHEREAS, the Assignor proposes to assign to the Assignee all of the
rights of the Assignor under the Credit Agreement in respect of a portion of its
Commitment thereunder in an amount equal to $[ ] (the "Assigned
Amount"), together with a corresponding portion of its outstanding Committed
Loans, and the Assignee proposes to accept assignment of such rights and assume
the corresponding obligations from the Assignor on such terms;
NOW, THEREFORE, in consideration of the foregoing and the mutual
agreements contained herein, the parties hereto agree as follows:
SECTION 1. Definitions. All capitalized terms not otherwise defined
herein shall have the respective meanings set forth in the Credit Agreement.
SECTION 2. Assignment. The Assignor hereby assigns and sells to the
Assignee all of the rights of the Assignor under the Credit Agreement to the
extent of the Assigned Amount, and the Assignee hereby accepts such assignment
from the Assignor and assumes all of the obligations of the Assignor under the
Credit Agreement to the extent of the Assigned Amount, including the purchase
from the Assignor of the corresponding portion of the principal amount of the
Committed Loans made by the Assignor outstanding at the date hereof. Upon the
execution and delivery hereof by the Assignor, the Assignee, [the Borrower and
the Agent] and the payment of the amounts specified in Section 3 required to be
paid on the date hereof (i) the Assignee shall, as of the date hereof, succeed
to the rights and be obligated to perform the obligations of a Bank under the
Credit Agreement with a Commitment in an amount equal to the Assigned Amount,
and (ii) the Commitment of the Assignor shall, as of the date hereof, be reduced
by a like amount and the Assignor released from its obligations under the Credit
Agreement to the extent such obligations have been assumed by the Assignee. The
assignment provided for herein shall be without recourse to the Assignor.
SECTION 3. Payments. As consideration for the assignment and sale
contemplated in Section 2 hereof, the Assignee shall pay to the Assignor on the
date hereof in Federal funds the amount heretofore agreed between them. 1/ It is
understood that commitment and/or facility fees accrued to the date hereof are
for the account of the Assignor and such fees accruing from and including the
date hereof are for the account of the Assignee. Each of the Assignor and the
Assignee hereby agrees that if it receives any amount under the Credit Agreement
which is for the account of the other party hereto, it shall receive the same
for the account of such other party to the extent of such other party's interest
therein and shall promptly pay the same to such other party.
[SECTION 4. Consent of the Borrower and the Agent. This Agreement is
conditioned upon the consent of the Borrower and the Agent pursuant to Section
10.6(c) of the Credit Agreement. The execution of this Agreement by the
Borrower and the Agent is evidence of this consent. Pursuant to Section
10.6(c), the Borrower agrees to execute and deliver a Note payable to the order
of the Assignee to evidence the assignment and assumption provided for herein.]
SECTION 5. Non-Reliance on Assignor. The Assignor makes no
representation or warranty in connection with, and shall have no responsibility
with respect to, the solvency, financial condition, or statements of the
Borrower, or the validity and enforceability of the obligations of the Borrower
in respect of the Credit Agreement or any Note. The Assignee acknowledges that
it has, independently and without reliance on the Assignor, and based on such
documents and information as it has deemed appropriate, made its own credit
analysis and decision to enter into this Agreement and will continue to be
responsible for making its own independent appraisal of the business, affairs
and financial condition of the Borrower.
SECTION 6. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York.
SECTION 7. Counterparts. This Agreement may be signed in any number
of counterparts, each of which shall be an original, with the same effect as if
the signatures thereto and hereto were upon the same instrument.
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed and delivered by their duly authorized officers as of the date first
above written.
<NAME OF ASSIGNOR>
By
Name:
Title:
- -------------
FN:1/Amount should combine principal together with accrued interest and breakage
compensation, if any, to be paid by the Assignee, net of any portion of any
upfront fee to be paid by the Assignor to the Assignee. It may be
preferable in an appropriate case to specify these amounts generically or
by formula rather than as a fixed sum.
<NAME OF ASSIGNEE>
By
Name:
Title:
<NAME OF BORROWER>
By
Name:
Title:
MORGAN GUARANTY TRUST COMPANY
OF NEW YORK, as Agent
By
Name:
Title:
Exhihit 10.11
TRADE NAME LICENSE AGREEMENT
Agreement made as of December 31, 1996, by and between OLIN CORPORATION, a
Virginia corporation with offices at 501 Merritt Seven, Norwalk, Connecticut
06856-4500 ("Olin") and PRIMEX TECHNOLOGIES, INC., a Virginia corporation with
offices at 10101 9th Street North, St. Petersburg, Florida 33716-3807
("Primex").
In consideration of the mutual covenants and obligations hereunder, the
parties agree as follows:
WHEREAS, Olin has transferred to Primex all or substantially all of the
assets related to Olin's Ordnance and Aerospace divisions (collectively the
"Primex Business") in anticipation of the spin-off of Primex to the shareholders
of Olin; and
WHEREAS, Primex wishes to use, and Olin is willing to authorize Primex to
use, certain trade names associated with the Primex Business for the limited
purposes provided herein.
NOW, THEREFORE, Olin and Primex agree as follows:
1 DEFINITIONS.
1.1 AFFILIATE. "Affiliate" shall mean, when used with respect to a
specified Person, another Person that directly, or indirectly through one or
more intermediaries, Controls or is Controlled by or is under common Control
with the Person specified.
1.2 CONTROL. "Control' shall mean the possession, directly or indirectly,
of the power to direct or cause the direction of the management or policies of a
Person, whether through the ownership of voting securities, by contract or
otherwise, and the terms "Controlling" and "Controlled" shall have meanings
correlative thereto.
1.3 EFFECTIVE TIME. "Effective Time" shall mean the Effective Time
specified in that certain Distribution Agreement made between Olin and Primex
dated as of December 30, 1996.
1.4 PERSON. "Person" shall mean any natural person, corporation,
business trust, joint venture, association, company, partnership or government,
or any agency or political sub-division thereof.
1.5 PRIMEX BUSINESSES. "Primex Businesses" shall mean the businesses of
the Ordnance and Aerospace Divisions of Olin or their constituent companies and
their predecessor companies as they were carried out on or before the Effective
Time.
1.6 TRADE NAMES. "Trade Names" shall mean all of, and "Trade Name" shall
mean any of, the following: OLIN, OLIN CORPORATION, OLIN AEROSPACE, OAC, and
OLIN ORDNANCE.
2. LICENSE. Olin hereby grants to Primex and Primex's subsidiary companies a
worldwide, nonexclusive, royalty-free license to use the Trade Names in
accordance with the terms of this Agreement.
3. LIMITED USE.
3.1 Primex shall use the Trade Names only to the extent reasonably
necessary:
(i) To inform its customers and the public that Primex includes the
businesses formerly conducted by Olin under the Trade Names. In all uses of the
Trade Names, Primex shall ensure that the Trade Name appears in a less prominent
position than its current business name, and appears only to inform the public
(e.g., "Primex Technologies, formerly Olin Ordnance "or" Primex Aerospace
Company, formerly Olin Aerospace Company").
(ii) For purposes of operating under permits, licenses, and other
governmental authorizations granted to Olin and assigned to Primex (collectively
"Permits"), and to provide Primex the time necessary to amend the existing
Permits or file applications for new Permits in Primex's own name, and to
continue required reporting or product delivery under the Trade Name(s) until
the earlier of the effective date of the amended or new Permits or the
expiration of this Agreement.
(iii) For completion of contracts and other agreements entered into
by Olin under the Trade Names.
(iv) To use up stocks of packaging and forms purchased by Olin and
any of its subsidiaries prior to the date hereof and transferred to Primex and
any of its subsidiaries.
3.2 Primex shall not use any of the Trade Names in any manner that
suggests an agency, partnership, or joint venture relationship with Olin.
3.3 Olin reserves all rights in the Trade Names not expressly granted to
Primex herein.
4. REASONABLE EXTENSION. Olin shall not withhold its approval of any
extension of time that Primex Technologies may reasonably request to continue to
use any of the Trade Names, so long as (i) in Olin's judgment, Primex
Technologies is diligently proceeding in good faith to eliminate its use of any
of the Trade Names, and (ii) in no event shall any such extension exceed 18
months following the Effective Time.
5. QUALITY CONTROL. Upon Olin's request, Primex will provide Olin with
samples of each use of a Trade Name for Olin's review and approval. Primex
shall immediately correct any deficiencies noted by Olin for failure to comply
with this Agreement.
6. NO WARRANTY. Olin is licensing the Trade Names to Primex "AS IS." Olin
makes no representations or warranties as to the Trade Names, and hereby
excludes all warranties, express or implied.
7. OWNERSHIP. Primex acknowledges that Olin is the owner of the Trade Names
and owns all rights in the Trade Names. Primex shall take no action during or
following the term of this Agreement contrary to, or in conflict with, Olin's
rights in the Trade Names.
8. INDEMNIFICATION. Primex agrees to defend, indemnify, and hold Olin
harmless from and against all losses, expenses (including reasonable legal fees
and costs), damages, injuries, liabilities, and claims arising out of or
relating to Primex's use of any of the Trade Names.
9. TERM AND TERMINATION.
9.1 This Agreement shall be effective for one (1) year beginning on
the date first set forth above, unless sooner terminated as provided herein.
9.2 Either party may terminate this Agreement effective upon thirty
(30) days' notice to the other in the event of a material breach of this
Agreement by the other party that the breaching party fails to correct during
such period.
9.3 Immediately upon expiration or termination of this Agreement,
Primex will cease and desist from all uses of any of the Trade Names.
9.4 Each party's obligations under Articles 6, 7, 8 and 9 shall
survive expiration and termination of this Agreement.
10. FURTHER ASSURANCES. Each party will execute all documents reasonably
requested by the other to effect any of the provisions of this Agreement.
11. NOTICES. Notices or requests to be given or made hereunder shall be
delivered in person or sent by registered mail or telefax or telex acknowledged
by the operator of the addressee at the following addresses or other addresses
that each Party may from time to time designate.
(a) for PRIMEX:
PRIMEX TECHNOLOGIES, INC.
10101 Ninth Street North
St. Petersburg, Florida 33716-3807
ATTENTION: General Counsel
Tel: (813)578-1116
Fax: (813)578-8795
(b) for OLIN:
OLIN CORPORATION
501 Merritt Seven
Norwalk, Connecticut 06856-4500
Attention: Corporate Secretary
Tel: (203) 356-3126
Fax: (203) 356-2011
12. ASSIGNMENT
12.1 LIMITATIONS ON ASSIGNMENT. This Agreement shall not be assigned by
either Party to a third party without the prior written consent of the other
Party, except to: an Affiliate of a Party, or a successor in the business to
which this Agreement relates, or a successor in all or substantially all of the
assets of either Party, provided that the successor agrees in writing to accept
the rights and to be bound by the obligations of the assigning Party, any other
assignment being void. The Parties agree to guarantee the performance of their
Affiliates under this Agreement.
12.2 CHANGE OF CONTROL. For purposes of Section 11.1. the following shall
be deemed an assignment by a Party of this Agreement:
12.2.1: a Person (or two or more Persons acting as a "person" within
the meaning of Section 13(d)(3) of the Securities Exchange Act of 1934, as
amended (the "1934 Act")), other than such Party, or an employee benefit plan
(or related trust) of such Party, becomes the "beneficial owner" (as defined in
Rule 13d-3 under the 1934 Act) of 15% or more of the then outstanding voting
stock of such Party, or during any period of two consecutive years, individuals
who at the beginning of such period constitute the Board of Directors of such
Party (together with any new director whose election by the Board or whose
nomination for election by such Party's shareholders was approved by a vote of
at least two-thirds of the directors then still in office who either were
directors at the beginning of such period or whose election or nomination for
election was previously so approved) cease for any reason to constitute a
majority of the new directors then in office, and/or
12.2.2: any consolidation or merger of such Party in which such
Party is not the continuing or surviving corporation or pursuant to which shares
of such Party's common stock would be converted into cash, securities or other
property other than a merger in which holders of such Party's common stock
immediately prior to the merger will have the same proportionate ownership of
common stock of the surviving corporation immediately after the merger, and/or
12.2.3: any sale, lease, exchange or other transfer (in one
transaction or a series of related transactions) of all or substantially all the
assets of such Party, and/or
12.2.4: adoption of any plan or proposal for the liquidation or
dissolution of such Party.
12.3 VIOLATION. Any assignment in violation of this Article 12 shall be
considered void.
13. GENERAL PROVISIONS.
13.1 ENTIRE AGREEMENT. This Agreement embodies the entire
understanding of the Parties. No amendment or modification of the Agreement
shall be valid or binding upon the Parties unless it is in writing and signed by
the respective duly authorized officers of the Parties.
13.2 Parties ARE INDEPENDENT. This Agreement does not and shall not be
deemed to make either Party the agent, legal representative or partner of the
other Party for any purpose whatsoever, and neither Party shall have the right
or authority to assume or create any obligation or responsibility whatsoever,
expressed or implied, on behalf of or in the name of the other Party or to bind
the other Party in any respect whatsoever.
13.3 WAIVER. The failure of either Party at any time to require
performance by the other Party of any provision hereof shall in no way affect
the full right to require such performance within a reasonable time or
thereafter the performance of that and all other provisions, nor shall the
waiver of any succeeding breach of such provision or any other provision operate
as a waiver of the provision itself.
13.4 SEVERABILITY. The invalidity or unenforceability of any one or more
of the provisions of This Agreement shall not affect the validity or
enforceability of the remaining provisions.
13.5 GOVERNING LAW. This Agreement shall be construed and
governed, in all respects, by the law of the State of Illinois applicable to
contracts made and to be performed in that state without reference to any
provisions relating to conflicts of law.
13.6 JURISDICTION. Each Party hereby irrevocably and unconditionally
submits, for itself and its property, to the nonexclusive jurisdiction of any
Illinois State court or Federal court of the United States of America sitting
anywhere within a radius of 50 miles from East Alton, Illinois, and any
appellate court from any thereof, in any action or proceeding arising out of or
relating to this Agreement, or for recognition or enforcement of any judgment,
and each of the Parties hereby irrevocably and unconditionally agrees that all
claims in respect of any such action or proceeding may be heard and determined
in such Illinois State or, to the extent permitted by law, in such Federal
court. Each of the Parties hereto agrees that a final judgment in any such
action or proceeding shall be conclusive and may be enforced in other
jurisdictions by suit on the judgment or in any other manner provided by law.
13.7 VENUE. Each Party hereby irrevocably and unconditionally waives, to
the fullest extent it may legally and effectively do so, any objection that it
may now or hereafter have to the laying of venue of any suit, action or
proceeding arising out of or relating to this Agreement in any Illinois State
court or such Federal court located in the State of Illinois. Each of the
Parties hereto hereby irrevocably waives, to the fullest extent permitted by
law, the defense of an inconvenient forum to the maintenance of such action or
proceeding in any such court.
13.8 SERVICE OF PROCESS. Each Party to this Agreement irrevocably consents
to service of process in the manner provided for notices in Article 11 hereof.
Nothing in this Agreement will affect the right of any party to this Agreement
to serve process in any other manner permitted by law.
13.9 COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original, but all of this
shall constitute one and the same instrument
14. SETTLEMENT OF DISPUTES
In the event of any disputes arising out of or in connection with the execution,
interpretation, performance or nonperformance of this Agreement, Primex and Olin
shall use the following procedure prior to either Party pursuing other available
legal remedies:
14.1 ALTERNATIVE DISPUTE RESOLUTION. Upon signing of this Agreement each
Party will designate one representative ("Representative") for the purpose of
resolving disputes which may arise from time to time. Upon a dispute arising,
either or both Representatives may request in writing a conference with the
other. If so requested, the conference shall occur within ten (10) days of the
initial written request and shall be held via telephone or at East Alton,
Illinois, or elsewhere, at the option of the Representatives. The purpose and
scope of the conference shall be limited to issues related to resolving the
dispute. At the conference, each Representative, or his or her designee, shall
use best efforts to attempt to resolve the dispute. If the dispute has not been
settled within thirty (30) days of the first meeting of the Representatives, the
parties shall establish a Management Appeal Board ("MAB") within ten (10) days
of receipt of a request by either Party to set up an MAB. The MAB shall
consist of two (2) members of each respective Party's management. The President
of OLIN shall appoint two members to represent OLIN and the President of PRIMEX
shall appoint two members to represent PRIMEX. The sole purpose of MAB shall be
to resolve any dispute over which the Representatives failed to resolve. The
MAB members shall be persons other than the Representatives. The MAB shall meet
at East Alton, Illinois or otherwise confer to resolve the dispute by good faith
negotiations, which may include presentations by the Representatives or others.
14.2 ARBITRATION. In the event the parties are unable to resolve their
disputes after availing themselves of the processes set forth in Section 14.1
above for a period of ninety (90) days, such disputes, shall be solely and
finally settled by three arbitrators in accordance with the Commercial
Arbitration Rules of the AAA (the "Arbitration Rules"). The Party electing
arbitration shall so notify the other Party in writing in accordance with the
Arbitration Rules, and such notice shall be accompanied by the name of the
arbitrator selected by the Party serving the notice. The second arbitrator
shall be chosen by the other Party, and a neutral arbitrator shall be chosen by
the two arbitrators so selected. If a Party fails to select an arbitrator or to
advise the other Party of its selection within thirty (30) days after receipt by
such a Party of the notice of the intent to arbitrate, the second arbitrator
shall be selected by the AAA. If the third arbitrator shall not have been
selected within thirty (30) days after the selection of the second arbitrator,
the appointment shall be made by the AAA. All such proceedings shall be
conducted in New York, New York. The arbitrator shall make detailed findings of
fact and law in writing in support of the decision of the arbitrator panel, and
is empowered to award reimbursement of attorneys' fees and other costs of
arbitration to the prevailing Party, in such manner as the arbitrator panel
shall deem appropriate. The provisions of this Section 14.2 shall not be deemed
to preclude any Party hereto from seeking preliminary injunctive relief to
protect or enforce its rights hereunder, or to prohibit any court from making
preliminary findings of fact in connection with granting or denying such
preliminary injunctive relief, or to preclude any Party hereto from seeking
permanent injunctive or other equitable relief after and in accordance with the
decision of the arbitrator panel. Whether any claim or controversy is arbitrable
or litigable shall be determined solely by the arbitrator panel pursuant to the
provisions of this Section 14.2. Any monetary award of the arbitrators panel
shall include interest from the date of any breach or any violation of this
Agreement. The arbitrators shall fix an appropriate rate of interest from the
date of the breach or other violation to the date when the award is paid in
full. The parties agree that judgment on the arbitration award may be entered
in any court having jurisdiction over the parties or their assets.
14.3 CONTINUING OBLIGATIONS. It is expressly agreed that the failure of
the parties to resolve a dispute on any issue to be resolved hereunder shall not
relieve either Party from any obligation set forth in this Agreement. In
addition, notwithstanding the pendency of any such dispute, neither Party will
be excused of its obligations hereunder to cooperate with the other to
effectuate the purposes of this Agreement.
IN WITNESS WHEREOF, each party has caused its duly authorized
representative to execute this Agreement as of the date set forth above.
OLIN CORPORATION PRIMEX TECHNOLOGIES, INC.
By: Johnnie M. Jackson, Jr. By: George H. Pain
----------------------- --------------
Name: George H. Pain
Name: Johnnie M. Jackson, Jr. Title: Vice President
Title: Vice President,
General Counsel and Secretary
Exhibit 10.12
TRANSITION SERVICES AGREEMENT
This Transition Services Agreement dated as of December 31, 1996
(collectively with the Exhibits hereto, the "Agreement") between PRIMEX
TECHNOLOGIES, INC., a Virginia corporation ("Primex"), and OLIN CORPORATION, a
Virginia corporation ("Olin").
W I T N E S S E T H
WHEREAS, Olin and Primex have entered into a Distribution Agreement dated
as of December 30, 1996 ("Distribution Agreement");
WHEREAS, pursuant to the Distribution Agreement, Olin has agreed to
transfer certain assets and business entities constituting the Primex Business
(as defined in the Distribution Agreement) as provided in the Distribution
Agreement;
WHEREAS, prior to the Effective Time (as defined in the Distribution
Agreement) the Primex Business has received various support services from, and
provided various support services to, Olin and its subsidiaries; and
WHEREAS, following Distribution contemplated by the Distribution Agreement,
Olin and Primex desire that for a period of transition and for purposes of
continuity Olin continue to provide certain services to Primex and that Primex
continue to provide certain services to Olin and its subsidiaries, all in a
manner and amount historically provided prior to the Effective Time (as defined
in the Distribution Agreement) and on terms and conditions as set forth in this
Agreement.
NOW THEREFORE, in consideration of the mutual covenants and premises
contained herein, Olin and Primex agree as follows:
1. DEFINITIONS. (a) The following terms have the meanings hereinafter
assigned to them:
"Arbitration Rules" - See Section 9.
"Confidential Information" - See Section 3.
"Customer" means (i) with respect to Olin Services, Primex and (ii) with
respect to Primex Services, Olin and its subsidiaries.
"Employee Benefits Information" - See Section 3.
"MAB" - See Section 9.
"Olin Services" means each service listed on Exhibit A hereto.
"Primex Services" means each service listed on Exhibit B hereto.
"Provider" means (i) with respect to Olin Services, Olin and (ii) with
respect to Primex Services, Primex.
"Representative" - See Section 9.
"Services" means the Olin Services and Primex Services, as the case may be.
"Service Charge" - See Section 4 hereof.
"Service Description" means the description of each individual Service
respectively provided in Exhibits A and B.
"Standard of Care" - See Section 2(a) hereof.
(b) Any capitalized term utilized but not defined herein shall have the
meaning assigned to it in the Distribution Agreement.
2. SERVICES. (a) Subject to the terms of this Agreement, (1) Olin will
provide to Primex the Olin Services in the manner, to the same location and to
the extent provided by Olin (and not by an outside contractor) to the Primex
Business during the one-year period immediately preceding the date of this
Agreement and (2) Primex shall provide to Olin and its subsidiaries the Primex
Services in the manner and to the extent that provided by the Primex Business
(and not by an outside contractor) during the one-year period immediately
preceding the date of this Agreement. In providing the Services, the Provider
shall employ the same standards of care and diligence employed in providing
services of the same type for itself and its affiliates ("Standard of Care").
Exhibits A and B made an integral part of this Agreement will identify the
Services to be provided by the parties hereto and subject to the mutual
agreement of the parties, will be subject to amendment as the parties identify
after the Effective Time any additional Services omitted from the Exhibits.
(b) No Provider employee shall be considered a Customer employee for any
purpose, and the Provider shall provide the Services as an independent
contractor.
(c) The Customer shall, in a timely manner, take all such actions as may
be reasonably necessary or desirable in order to enable or assist the Provider
to provide the Services, including, but not limited to, providing necessary
information and specific written authorizations and consents, and the Provider
shall be relieved of its obligations hereunder to the extent that the Customer's
failure to take any such action renders performance by the Provider unlawful or
impracticable.
3. CONFIDENTIALITY.
(a) CONFIDENTIALITY OBLIGATION: Each of the Parties agrees to keep
confidential and neither disclose to others nor use except as permitted herein
any "Confidential Information" or any "Employee Benefits Information" received
from the other Party pursuant to this Agreement.
(b) DEFINITIONS: For purposes of this Agreement, "Confidential
Information" shall mean any and all information disclosed to the receiving Party
by a disclosing Party pursuant to this Agreement, in any form such as, but not
limited to, visual, oral, written, graphic, electronic or model form, including
but not limited to know-how and trade secrets, whether of a business or a
technical nature, whether patented or not and whether in the laboratory, pilot
plant or commercial plant stage (including drawings, operating conditions,
specifications, safety instructions, environmental recommendations, emergency
instructions, etc.) owned or controlled by a Party. "Employee Benefits
Information" shall mean information relating to the administration of Primex's
and Olin's employee benefit programs as provided in Exhibits attached hereto,
including but not limited to information and/or data submitted for reimbursement
of, or in support of, any benefits claim (including but not limited to health,
counseling, medical, dental, or disability claims).
(c) LIMITS ON DISCLOSURE: The receiving Party shall treat all
Confidential Information in the same manner and with the same degree of care as
it uses with respect to its own Confidential Information of like nature and
shall disclose Confidential Information of the other Party only to its employees
who have a need to know it, provided that such employees are bound to respect
all secrecy obligations provided for in this Agreement. The receiving Party
shall treat all Employee Benefits Information with highest standard of care
reasonable for such information, and shall disclose Employee Benefit Information
of the other Party only to its employees who have a strict need to know it,
provided that such employees are bound to respect all secrecy obligations
provided for in this Agreement.
(d) EXCEPTIONS: The obligation set forth in Section 3(a) above shall not
apply with respect to any Confidential Information which:
(i) PUBLIC KNOWLEDGE: Is generally available to the public or
subsequently becomes generally available to the public through no breach by the
receiving Party of secrecy obligations under this Agreement or prior agreements
between the Parties concerning the Confidential Information; or
(ii) PRIOR POSSESSION: The receiving Party can establish by competent
evidence was in its possession at the time of disclosure and was not acquired in
confidence directly or indirectly, from the disclosing Party; or
(iii) RECEIVED FROM THIRD PARTY: Is received from a third party
who is legally free to disclose such Confidential Information and who did not
receive such Confidential Information in confidence from the disclosing Party;
or
(iv) APPROVED FOR DISCLOSURE: Is approved in writing for release by
the disclosing Party; or
(v) SUCCESSOR IN INTEREST: Is disclosed to any permitted assignee of
the Agreement, provided that such assignee agrees to be bound by the provisions
of the Agreement; or
(vi) INDEPENDENTLY DEVELOPED: Is independently developed by the
receiving Party without reference to the Confidential Information received from
the disclosing Party.
(e) PERMITTED DISCLOSURES: The provisions of Section 3(a)
notwithstanding, in exercising the rights granted under this Agreement, either
Party may disclose Confidential Information to others for purpose of
sublicensing (as permitted hereunder), design, engineering, construction or
operation of facilities permitted hereunder using Confidential Information; or
obtaining or giving consulting services under a license agreement permitted
hereunder, provided that any third party, to which such Confidential Information
is disclosed shall have first entered into a written secrecy and non-use
obligation at least as stringent as that imposed on the Parties pursuant to this
Agreement.
(f) SUBPOENA OR DEMAND: The provisions of Section 3(a) notwithstanding, a
Party may disclose Confidential Information and/or Employee Benefits Information
pursuant to a subpoena or demand for production of documents in connection with
any suit or arbitration proceeding, any administrative procedure or before a
governmental or administrative agency or instrumentality thereof or any
legislative hearing or other similar proceeding, provided that the receiving
Party shall promptly notify the disclosing Party of the subpoena or demand and
provided further that in such instances, the Parties use their reasonable best
efforts to maintain the confidential nature of the Confidential Information by
protective order or other means.
(g) GOVERNMENT AUDIT: The provisions of Section 3(a) notwithstanding, a
Party may disclose Confidential Information (other than information which is not
required by U.S. Government regulation to be made available to U.S. Government
auditors (E.G., internal audit reports)) to U.S. Government auditors upon
request during the performance of a governmental audit or review of any U.S.
Government contract of such other party in the normal course of the audit
function and according to standard practices; provided prompt notice of the
disclosure of such information shall be given to the party from which the
information was obtained.
4. COMPENSATION. In consideration of the provision of the Services, the
Customer shall, for each Service performed, pay Provider the monthly base fee
plus additional charges set forth in Exhibit A or B (such monthly fee and
additional charges being collectively, the "Service Charge" for such Service)[,
provided that the monthly base fee which is part of the Service Charge will be
prorated for the number of days remaining in the calendar month in which the
Effective Time occurs]. The monthly base fee of the Service Charge for any month
will be paid in advance on the last business day of the preceding month except
that the first monthly fee paid hereunder shall be paid immediately following
the Effective Time. Except as otherwise set forth herein, the Provider will
invoice the Customer for any additional costs incurred by the Provider for the
benefit of the Customer which are to be paid pursuant to Exhibit A or B hereto,
and such invoices will be payable within 30 days of receipt.
5. GOVERNMENT CONTRACTS. In the event that the Services to be performed
involve contracts the Customer may have as a Government prime contractor or
subcontractor, the provisions of such contracts required by any applicable
federal acquisition regulation, including but not limited to, the Walsh-Healey
Public Contracts Act, Fair Labor Standards Act, Officials Not to Benefit,
Covenant Against Contingent Fees, Nondiscrimination in Employment, Military
Security Requirements, Office of Federal Procurement Policy Act and Examination
of Records, shall be binding on Provider to the extent necessary to enable the
Customer to meet its legal and contractual commitments.
If the Services to be performed by Provider include the receiving,
handling, or developing of any Government classified material or data, Provider
agrees that it and any and all persons or entities in its employ or control
shall comply with all applicable security regulations and requirements. Each
Provider agrees to immediately submit a confidential report to Customer
whenever, for any cause, it has reason to believe that there is an active danger
of espionage or sabotage affecting any work under such Government contracts.
Each Provider represents and warrants that it is familiar with the laws,
rules, orders, and regulations applicable to the performance of government
procurement contracts with federal agencies including, but not limited to, the
Department of Defense, the Department of Energy, and the National Aeronautics
and Space Administration; that each will abide by all such laws, rules, orders
and regulations; that it, and each of its employees performing Services
hereunder, is eligible to act as a consultant to a U.S. Government defense
contractor under all applicable federal laws and regulations regarding post-
government employment; and that it will provide any and all certifications,
representations, reports, records or any other document required to be submitted
by suppliers under federal contracts.
6. LIMITATION OF LIABILITY: INDEMNITY. (a) A Provider shall have no
liability to the Customer or any third party in connection with the provision of
the Services except to the extent such Services were provided in breach of the
Provider's Standard of Care and, in such a case, only to the extent of the
following:
(i) a dollar amount limited to the amount of insurance proceeds paid
to Provider therefor from a third party insurance company, and
(ii) at the option of the Customer, Provider shall either:
(x) perform again the particular Service performed in breach of
the Standard of Care at no cost to Customer, or
(y) give the Customer a refund of the portion of the monthly base
fee attributable to the cost of performance of the Service provided in breach of
the Standard of Care.
In no event shall the Provider be liable in connection with its provision of the
Services for any indirect, special or consequential damages, including any fines
or penalties payable by the Customer to any government agency, or for any loss
of profits or other economic damages.
(b) The Customer hereby agrees to indemnify and hold the Provider and its
officers, directors, agents and employees harmless from and against any and all
liabilities, losses, damages, expenses, fines and penalties of any kind,
including reasonable attorneys' fees and disbursements incurred by the Provider
either:
(i) as the result of any claim made against the Provider by any third
party arising out of the Provider's provision of the Services (except to the
extent, and only to the extent, of Provider's liability to Customer for the
respective Service as provided in Paragraph 6(a), above); and/or
(ii) arising out of the Customer's negligence or malfeasance in
connection with its use of the Services.
7. INSURANCE. The Provider shall procure and maintain fire, public
liability, fidelity, property and other types of insurance, which are reasonably
necessary to protect itself and the Customer and consistent with past practice
(which may include self-insurance). All such policies of insurance with third
party insurers shall name Customer as an additional insured party to the extent
possible.
8. FORCE MAJEURE. Neither the Customer nor the Provider shall be liable
for any delays in its performance hereunder caused by events beyond its
reasonable control including, without limitation: acts of God, acts of
government, fire, equipment breakdown, strikes or other similar labor disputes
(settlement of which shall be in the sole discretion of the employer), or the
inability to acquire materials or third-party services. Upon the occurrence of
any event which is expected to or does cause a delay in performance hereunder,
the person or party whose performance is or may be delayed shall give prompt
written notice thereof to the Customer or Provider, as the case may be.
9. DISPUTES. In the event of any disputes arising out of or in
connection with the execution, interpretation, performance or nonperformance of
this Agreement, Provider and Customer shall use the following procedure prior to
either party pursuant other available legal remedies:
Upon signing of this Agreement, each party will designate one
representative ("Representative") for the purpose of resolving disputes which
may arise from time to time. A party may change its Representative to act
hereunder at any time upon notice to the other. Upon a dispute arising, either
or both Representatives may request in writing a conference with the other. If
so requested, the conference shall occur within ten (10) days of the initial
written request and shall be held via telephone or at a mutually agreed upon
location, at the option of the Representatives. The purpose and scope of the
conference shall be limited to issues related to resolving the dispute. At the
conference, each Representative shall use their reasonable best efforts to
attempt to resolve the dispute. If the dispute has not been settled within
thirty (30) days of the first meeting of the Representatives, the parties shall
establish a Management Appeal Board ("MAB") within ten (10) days of receipt of a
request by either party to set up a MAB. The MAB shall consist of two (2)
members of each respective party's management. Olin shall appoint two members
to represent Olin, and Primex shall appoint two members to represent Primex.
The sole purpose of MAB shall be to resolve any dispute over which the
Representatives failed to resolve. The MAB members shall be persons other than
the Representatives. The MAB shall meet at Olin's headquarters or other place
mutually agreed upon and confer to resolve the dispute by good faith
negotiations, which may include presentations by the Representative or others.
In the event the parties are unable to resolve their disputes after
availing themselves of the processes set forth above for a period of ninety (90)
days, such disputes shall be solely and finally settled by a board of three (3)
arbitrators in accordance with the Commercial Arbitration Rules (the
"Arbitration Rules") of the American Arbitration Association ("AAA"). The party
electing arbitration shall notify the other party in writing in accordance with
the Arbitration Rules, and such notice shall be accompanied by the name of the
arbitrator selected by the party serving the notice. The second arbitrator
shall be chosen by the other party, and a neutral arbitrator shall be chosen by
the two arbitrators so selected. If a party fails to select an arbitrator or to
advise the other party of its selection within thirty (30) days after receipt by
such a party of the notice of the intent to arbitrate, the second arbitrator
shall be selected by the AAA. If the third arbitrator shall not have been
selected within thirty (30) days after the selection of the second arbitrator,
the appointment shall be made by the AAA. All such proceedings shall be
conducted in East Alton, Illinois or another mutually agreed upon location. The
arbitrator shall make detailed findings of fact and law in writing in support of
the decision of the arbitrator panel, but shall not be empowered to award
reimbursement of attorneys' fees and other costs of arbitration to the
prevailing party. The provisions of this Section 9 shall not be deemed to
preclude any party hereto from seeking preliminary injunctive relief to protect
or enforce its rights hereunder, or to prohibit any court from making
preliminary findings of fact in connection with granting or denying such
preliminary injunctive relief, or to preclude any party hereto from seeking
permanent injunctive or other equitable relief after and in accordance with the
decision of the arbitrator panel. Whether any claim or controversy is
arbitrable or litigable shall be determined solely by the arbitrator panel
pursuant to the provisions of this Section 9. Any monetary award of the
arbitrators panel shall include interest from the date of any breach or any
violation of this Agreement. The arbitrators shall fix an appropriate rate of
interest from the date of the breach or other violation to the date when the
award is paid in full. The parties agree that the decision of the arbitrators
shall be final and conclusive and that judgment on the arbitration award may be
entered in any court having jurisdiction over the parties or their assets.
It is expressly agreed that the failure of the parties to resolve a dispute
on any issue to be resolved hereunder shall not relieve either party from any
obligation set forth in this Agreement. In addition, the parties expressly
state their mutual determination that the failure to resolve any such disputes
shall not hinder or delay the providing of the Services, and that,
notwithstanding the pendency of any such dispute, neither party will be excused
of its obligations hereunder to cooperate with the other to effectuate the
purposes of this Agreement.
10. BOOKS AND RECORDS. The Provider shall, upon reasonable notice and
during normal business hours, allow the Customer's financial personnel
reasonable access to its books, records and other information necessary to
confirm the calculation of the compensation and reimbursement due the Provider
hereunder.
11. TERM AND TERMINATION. The term of this Agreement shall commence as of
the date hereof and shall continue until Services are no longer provided
hereunder. Each Service shall terminate on the earliest of (i) the last day of
the third full calendar month following receipt by the Provider of written
notice from the Customer to terminate the Service, or (ii) the last day of the
term for such Service as specified in the respective Service Description.
12. NON-WAIVER. The Customer's or the Provider's waiver of any breach or
failure to enforce any of the terms or conditions of this Agreement at any time
shall not in any way affect, limit or waive such person's right thereafter to
enforce strict compliance with every term and condition hereof.
13. ASSIGNMENT. Neither this Agreement nor any right or obligation
hereunder is assignable or transferable by either party (in whole or part)
without the prior written consent of the other party and any such purported
assignment without such consent shall be void, except that either party shall
have the right to assign this Agreement and its rights and obligations
hereunder, without obtaining the prior written consent of the other party, to
any entity with which the assigning party merges or transfers a substantial part
of its assets or businesses to which this Agreement relates provided that such
assignee or transferee accepts such assignment or transfer and the rights and
obligations hereunder in writing. Nothing in this Agreement, express or
implied, is intended to confer any rights or remedies under this Agreement on
any person or entity other than Primex or Olin and their respective successors
and permitted assigns.
14. APPLICABLE LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of Illinois, without giving effect to its
conflict of laws provisions.
15. CAPTIONS. The titles contained in this Agreement are for reference
purposes only and shall not affect in any way the meaning or interpretation of
this Agreement.
16. AMENDMENT. This Agreement may be modified or amended only pursuant to
a written agreement executed on behalf of each of Olin and Primex. No
modification or addition to this Agreement shall be effected by the
acknowledgment or acceptance by either party of any purchase order, invoice,
acknowledgment, release or other forms submitted by the other party containing
other or different terms or conditions.
17. NOTICES. All notices, consents, termination notices, and other
communications to be given hereunder, other than routine immaterial
communications, shall be by telex or electronic facsimile, confirmed in writing
as hereinafter provided, or in writing which shall be valid and sufficient only
if delivered by hand or dispatched by registered or certified mail, return
receipt requested, postage prepaid, addressed to the other party at its address
as set forth below, or to such other address as has theretofore been designated
by the other party by notice given in accordance with this Section.
If to Olin
OLIN CORPORATION
501 Merritt Seven
P.O. Box 4500
Norwalk, CT 06856-4500
Attention: Corporation Secretary
Telecopier: (203) 750-3018
If to Primex
PRIMEX TECHNOLOGIES, INC.
10101 Ninth Street North
St. Petersburg, FL 33716-3807
Attention: Corporate Secretary
Telecopier: (813) 578- 8795
18. ENTIRE AGREEMENT. This Agreement (including the exhibits and
schedules referred to herein) constitutes the entire agreement with respect to
the subject matter hereof between the parties hereto and supersedes all prior
agreements and understandings, oral and written, between the parties hereto,
with respect to the subject matter hereof.
19. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall for all purposes be deemed to be an original
and all of which together shall constitute one and the same instrument.
20. SEVERABILITY. If any provision of this Agreement or the application
of any such provision to any person or circumstances shall be held invalid,
illegal or unenforceable in any respect by a court of competent jurisdiction,
such invalidity, illegality or unenforceability shall not affect any other
provision hereof.
21. EXCLUSIVE BENEFIT. This Agreement is made for the exclusive benefit
of Olin and Primex, and not for the benefit of any third party.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
and year first above written.
OLIN CORPORATION
By /s/ Johnnie M. Jackson, Jr.
---------------------------
Johnnie M. Jackson, Jr.
Title: Vice President, General
Counsel and Secretary
PRIMEX TECHNOLOGIES, INC.
By /s/ George H. Pain
------------------
George H. Pain
Title: Vice President
EXHIBIT A
- ---------
EXHIBIT A
OLIN SERVICES TO PRIMEX
NAME OF SERVICE: Treasury Services
OLIN DEPARTMENT
PROVIDING SERVICE: Funds Management
LOCATION OF PROVIDER: Norwalk, CT
PRIMEX DEPARTMENT
RECEIVING SERVICE: Cash Management
LOCATION OF RECEIVER: St. Petersburg
DESCRIPTION: Provide consulting to Primex Treasury on an as-
needed basis, including cash management and
related systems. See attached list of treasury
service estimates.
TERM: Ends no later than 12/31/97
MONTHLY BASE FEE: $1,050
ADDITIONAL CHARGES: $100/hour for services; out-of-pocket bank fees
for cash management and for services as charged.
NOTE: Treasury Services include the collection by Olin
of Primex receipts and the funding by Olin of
Primex disbursements. Charges for average cash
balances owing to Primex from Olin will be
calculated based on Olin's average investment rate
for the period. Charges for average cash deficits
owing to Olin from Primex will be calculated based
on Primex's average borrowing rate for the period.
Balances may not exceed $5 million and will be
settled at least bimonthly.
