<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON MAY 31, 1995
REGISTRATION NO. 33-
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------
LORAL CORPORATION
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
NEW YORK 13-1718360
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER I.D. NUMBER)
INCORPORATION)
600 THIRD AVENUE
NEW YORK, NEW YORK 10016
(212) 697-1105
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING
AREA CODE, OF REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
MICHAEL B. TARGOFF
SENIOR VICE PRESIDENT
AND SECRETARY
LORAL CORPORATION
600 THIRD AVENUE
NEW YORK, NEW YORK 10016
(212) 697-1105
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE,
OF AGENT FOR SERVICE)
COPIES TO:
BRUCE R. KRAUS, ESQ. ROBERT ROSENMAN, ESQ.
WILLKIE FARR & GALLAGHER CRAVATH, SWAINE & MOORE
ONE CITICORP CENTER 825 EIGHTH AVENUE
NEW YORK, NEW YORK 10022 NEW YORK, NEW YORK 10019
(212) 821-8000 (212) 474-1000
(COUNSEL FOR THE REGISTRANT) (COUNSEL FOR THE UNDERWRITERS)
------------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: As soon as
practicable after the effective date of this Registration Statement.
If the only securities being registered on this form are being offered
pursuant to dividend or interest reinvestment plans, check the following
box: [_]
If any of the securities being registered on this Form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, check the following box: [_]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following
box and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering: [_]
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering: [_]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box: [X]
------------------
CALCULATION OF REGISTRATION FEE
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- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PROPOSED
PROPOSED MAXIMUM
AMOUNT MAXIMUM AGGREGATE AMOUNT OF
TITLE OF EACH CLASS OF TO BE OFFERING PRICE OFFERING REGISTRATION
SECURITIES TO BE REGISTERED REGISTERED PER SHARE(1) PRICE(1) FEE
- --------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, $.25 par
value.................... 3,314,960 $46.4375 $153,938,455 $53,083
</TABLE>
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- --------------------------------------------------------------------------------
(1) Estimated solely for the purpose of computing the amount of the
registration fee pursuant to Rule 457(c) based upon the average of the high
and low sales price as reported on the New York Stock Exchange Composite
Tape on May 25, 1995.
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT
SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A),
MAY DETERMINE.
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- --------------------------------------------------------------------------------
<PAGE>
EXPLANATORY NOTE
This registration statement contains two forms of prospectus: one to be used
in connection with an offering in the United States and Canada (the "U.S.
Prospectus") and the other to be used in connection with a concurrent
international offering (the "International Prospectus"). The U.S. Prospectus
and the International Prospectus are identical except that they contain
different front and back cover pages. The form of the U.S. Prospectus is
included herein and is followed by those pages to be used in the International
Prospectus which differ from those in the U.S. Prospectus. Each of the pages of
the International Prospectus included herein is labeled "Alternate Page for
International Prospectus." Final forms of such prospectuses will be filed with
the Securities and Exchange Commission pursuant to Rule 424(b).
<PAGE>
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
+INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A +
+REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE +
+SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY +
+OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT +
+BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR +
+THE SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE +
+SECURITIES IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE +
+UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF +
+ANY SUCH STATE. +
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
SUBJECT TO COMPLETION, DATED MAY 31, 1995
PROSPECTUS
3,314,960 SHARES
[LORAL CORPORATION LOGO]
COMMON STOCK
-------------
All of the 3,314,960 shares of Common Stock, $0.25 par value (the "Common
Stock"), of Loral Corporation ("Loral" or the "Company") offered hereby are
offered by the Selling Stockholders (as defined herein). Of such shares,
2,654,960 shares are being offered initially in the United States and Canada by
the U.S. Underwriter (as defined herein) (the "United States Offering") and
660,000 shares are being offered concurrently outside the United States and
Canada by the International Manager (as defined herein) (the "International
Offering"). Such offerings are referred to collectively as the "Offerings." The
offering price and underwriting discounts and commissions for the United States
Offering and the International Offering will be identical. The Company will not
receive any of the proceeds from the sale of the shares offered hereby. See
"Selling Stockholders" and "Underwriting."
The Common Stock is listed on the New York Stock Exchange ("NYSE") under the
symbol "LOR." On June , 1995, the closing price of the Common Stock on the
NYSE Composite Tape was $ per share.
-------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
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<TABLE>
<CAPTION>
Underwriting
Price to Discounts and Proceeds to
Public Commissions(1) Selling Stockholders
- --------------------------------------------------------------------------------
<S> <C> <C> <C>
Per Share......................... $ $ $
- --------------------------------------------------------------------------------
Total............................. $ $ $
</TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(1) The Company and the Selling Stockholders have agreed to indemnify the U.S.
Underwriter and the International Manager against certain liabilities,
including liabilities under the Securities Act of 1933. See "Underwriting."
-------------
The shares of Common Stock offered by this Prospectus are offered by the U.S.
Underwriter subject to prior sale, to withdrawal, cancellation or modification
of the offer without notice, to delivery to and acceptance by the U.S.
Underwriter and to certain further conditions. It is expected that delivery of
the certificates for the shares will be made at the offices of Lehman Brothers
Inc. in New York, New York, on or about June , 1995.
-------------
LEHMAN BROTHERS
June , 1995
<PAGE>
IN CONNECTION WITH THIS OFFERING, THE UNDERWRITERS MAY OVER-ALLOT OR EFFECT
TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE COMMON STOCK
AT A LEVEL ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET. SUCH
TRANSACTIONS MAY BE EFFECTED ON THE NEW YORK STOCK EXCHANGE OR OTHERWISE. SUCH
STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME.
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934 (the "Exchange Act") and in accordance therewith files
reports, proxy statements and other information with the Securities and
Exchange Commission (the "SEC"). Such reports, proxy statements and other
information filed by the Company with the SEC can be inspected and copied at
public reference facilities maintained by the SEC at 450 Fifth Street, N.W.,
Washington, D.C. 20549; 7 World Trade Center, New York, New York 10048; and
Northwestern Atrium Center, 500 West Madison Street, Chicago, Illinois 60661.
Copies of such material can be obtained from the Public Reference Section of
the SEC at 450 Fifth Street, N.W., Washington, D.C. 20549 at prescribed rates.
The Company's Common Stock is listed on the NYSE. Reports, proxy statements and
other information concerning the Company can be inspected and copied at the
NYSE.
This Prospectus constitutes a part of a registration statement on Form S-3
(herein, together with all exhibits thereto, referred to as the "Registration
Statement") filed by the Company with the SEC under the Securities Act of 1933
(the "Securities Act"). This Prospectus does not contain all of the information
set forth in the Registration Statement, certain parts of which are omitted in
accordance with the rules and regulations of the SEC. Reference is hereby made
to the Registration Statement and related exhibits for further information with
respect to the Company and the securities offered hereby. Statements contained
herein concerning the provisions of documents are necessarily summaries of such
documents, and each statement is qualified in its entirety by reference to the
copy of the applicable document filed with the SEC.
INCORPORATION OF CERTAIN INFORMATION BY REFERENCE
The following documents, each of which was previously filed by the Company
with the SEC pursuant to the Exchange Act, are incorporated herein by
reference: (a) the Company's Annual Report on Form 10-K for the fiscal year
ended March 31, 1995; (b) the Company's Proxy Statement for its 1994 Annual
Meeting of Stockholders; and (c) the Company's Current Report on Form 8-K,
filed on May 22, 1995.
All documents filed by the Company pursuant to Sections 13(a), 13(c), 14 and
15(d) of the Exchange Act subsequent to the date of this Prospectus and prior
to the termination of the offering made hereby shall be deemed to be
incorporated by reference herein and to be part hereof from the date of the
filing of such reports and documents. Any statement contained in a document
incorporated or deemed to be incorporated by reference herein shall be deemed
to be modified or superseded for purposes of this Prospectus to the extent that
a statement contained herein or in any other subsequently filed document which
also is or is deemed to be incorporated by reference herein modifies or
supersedes such statement. Any such statement so modified or superseded shall
not be deemed, except as so modified or superseded, to constitute a part of
this Prospectus.
The Company will provide without charge to each person to whom a Prospectus
is delivered upon written or oral request of such person, a copy of any
documents incorporated herein by reference (other than exhibits to such
documents unless such exhibits are specifically incorporated by reference into
the documents that this Prospectus incorporates). Requests for such copies
should be directed to Loral Corporation, Attention: Secretary, 600 Third
Avenue, New York, New York 10016, telephone: (212) 697-1105.
2
<PAGE>
THE COMPANY
Loral is a leading supplier of advanced electronic systems, components and
services to U.S. and foreign governments for defense and non-defense
applications. The Company's principal business areas are: electronic combat;
training and simulation; tactical weapons; command, control, communications
and intelligence (C/3/I)/reconnaissance; systems integration; and
telecommunications and space systems. The Company has achieved an incumbent
position on a wide range of existing programs through internal growth and
development and a series of acquisitions focused on its core technologies.
Loral's business strategy is to emphasize upgrades of existing weapons
systems, concentrate on further developing its core of advanced technologies,
generate an increasing proportion of its sales from foreign customers and
selectively extend the Company's proprietary technologies into non-military
applications, such as systems integration, satellite-based telecommunications,
air traffic control, postal systems automation, medical and dental imaging
systems, data archiving and information systems and services.
On May 5, 1995, Loral acquired the Defense Systems operations of Unisys
Corporation. Unisys Defense Systems is a leading systems integrator and
supplier of advanced information technology products and services to defense
and other government agencies worldwide. See the Company's Current Report on
Form 8-K, filed on May 22, 1995, for further information.
Loral was incorporated in the State of New York in 1948. Its principal
executive offices are located at 600 Third Avenue, New York, New York 10016,
and its telephone number is (212) 697-1105. Unless the context otherwise
indicates, the terms "Company" and "Loral" refer to Loral and its consolidated
subsidiaries.
3
<PAGE>
SELECTED FINANCIAL DATA
The selected financial data should be read in conjunction with the related
Consolidated Financial Statements contained in the Company's Annual Report on
Form 10-K for the fiscal year ended March 31, 1995.
<TABLE>
<CAPTION>
1995 1994(A) 1993(B) 1992 1991(C)
--------- ------------------------------ -----------
(IN MILLIONS, EXCEPT PER SHARE AND RATIO AMOUNTS)
<S> <C> <C> <C> <C> <C>
OPERATING DATA:
Sales....................... $ 5,484.4 $ 4,008.7 $ 3,335.4 $ 2,881.8 $ 2,126.8
Operating income............ 564.5 401.4 296.3 292.2 215.5
Income before extraordinary
item and cumulative effect
of changes in accounting... 288.4 228.3 159.1 121.8 90.4
Net income (loss)........... 288.4 228.3 (92.1) 121.8 90.4
Earnings per share (prima-
ry):
Income before extraordi-
nary item and cumulative
effect of changes in ac-
counting................. 3.38 2.72 2.06 2.00 1.78
Net income (loss)......... 3.38 2.72 (1.20) 2.00 1.78
BALANCE SHEET DATA:
Total assets................ $ 4,810.3 $ 5,176.2 $ 3,228.1 $ 2,685.5 $ 2,532.2
Working capital............. 536.6 554.4 610.5 630.0 457.7
Total debt.................. 1,316.5 1,798.0 534.0 577.4 821.2
Shareholders' equity........ 1,687.5 1,381.3 1,187.9 997.3 672.0
Book value per common share. 19.86 16.60 14.44 15.72 13.14
CASH FLOW DATA:
Cash dividends paid per com-
mon share.................. $ .59 $ .545 $ .495 $ .47 $ .43
Depreciation and amortiza-
tion....................... 250.1 178.2 154.0 128.6 104.6
Capital expenditures, net... 85.3 96.5 89.0 74.1 86.1
RATIO OF EARNINGS TO FIXED
CHARGES.................... 4.58x 6.52x 4.79x 4.22x 3.30x
</TABLE>
- --------
(a) Reflects the acquisition of Federal Systems Company effective January 1,
1994.
(b) Reflects (i) the acquisition of the missile business of LTV Aerospace and
Defense Company effective August 31, 1992 and (ii) the acquisition of the
minority partners' equity interest in Loral Aerospace Holdings, Inc.
("LAH"), effective June 1, 1992, through the issuance of 12,313,810 shares
of the Company's common stock and 627.3 shares of Series S Preferred Stock
of LAH.
Effective April 1, 1992, the Company adopted Statement of Financial
Accounting Standards No. 106, "Employers' Accounting for Postretirement
Benefits Other Than Pensions" ("SFAS 106") and Statement of Financial
Accounting Standards No. 109, "Accounting for Income Taxes." Prior years'
results have not been restated to reflect these accounting changes.
Net income (loss) includes (i) a non-operating extraordinary charge (loss on
extinguishment of debt) of $28.2 million pre-tax, $17.8 million after-tax,
or $.23 per share and (ii) a non-recurring charge of $330.5 million pre-tax,
$233.4 million after-tax, or $3.03 per share, for the cumulative effect of
the accounting change for SFAS 106.
(c) Reflects the acquisition of Ford Aerospace Corporation effective October
1, 1990.
4
<PAGE>
SELLING STOCKHOLDERS
The Selling Stockholders are Lehman Brothers Merchant Banking Portfolio
Partnership L.P., a Delaware limited partnership (the "Merchant Banking
Partnership"), Lehman Brothers Capital Partners II, L.P., a Delaware limited
partnership ("Capital Partners"), Lehman Brothers Offshore Investment
Partnership L.P., a Bermuda limited partnership (the "Offshore Partnership"),
and Lehman Brothers Offshore Investment Partnership-Japan L.P., a Bermuda
limited partnership (the "Japan Partnership," and, together with the Merchant
Banking Partnership, Capital Partners and the Offshore Partnership, the
"Selling Stockholders" or the "Lehman Partnerships"). Certain indirect wholly
owned subsidiaries of Lehman Brothers Holdings Inc. ("Holdings") constitute the
general partners of each of the Lehman Partnerships and, consequently, Holdings
may be deemed for certain purposes to be the beneficial owner of the shares of
Common Stock being sold by the Lehman Partnerships.
The following table sets forth information with respect to the shares of
Common Stock owned by the Lehman Partnerships, all of which are being sold.
<TABLE>
<CAPTION>
SHARES OWNED
BEFORE THE OFFERING
-----------------------
% OF CLASS
(AS OF MAY 1,
NAME NUMBER 1995)(a)
---- --------- -------------
<S> <C> <C>
Merchant Banking Partnership......................... 1,610,277 1.89%
Capital Partners..................................... 1,094,018 1.28
Offshore Partnership................................. 442,459 0.52
Japan Partnership.................................... 168,206 0.20
--------- ----
Total.............................................. 3,314,960 3.89%
========= ====
</TABLE>
- --------
(a) On May 1, 1995, 85,162,768 shares of Common Stock were outstanding.
In 1990, in connection with the acquisition of Ford Aerospace Corporation by
Loral Aerospace Holdings Inc. ("LAH"), the Lehman Partnerships invested $147.5
million in the equity of LAH, and, in 1992, the Lehman Partnerships exchanged a
portion of such equity interest in LAH for 12,314,960 shares of Loral Common
Stock (including 1,150 shares issued to the Lehman Partnerships in payment of
expenses related to the exchange transaction). In June 1993, the Lehman
Partnerships sold 6,000,000 of such shares pursuant to an underwritten public
offering at a price of $26.875 per share, and, on June 23, 1994, the Lehman
Partnerships sold 3,000,000 of such shares to the Loral Corporation Master
Pension Trust at a price of $36.00 per share. The shares of Common Stock being
offered hereby represent all of the Lehman Partnerships' remaining shares of
Loral Common Stock. See "Underwriting." (All share numbers and price-per-share
amounts of Loral Common Stock in this paragraph have been adjusted to reflect
the Company's two-for-one stock split in October 1993.)
In addition, in connection with the exchange of their equity interest in LAH
in 1992, the Lehman Partnerships received 627.30 shares of Series S Preferred
Stock of LAH, representing an indirect beneficial interest in LAH's 51%-owned
affiliate, Space Systems/Loral, Inc. ("SS/L"). Each share of Series S Preferred
Stock represents a beneficial interest in one share of common stock of SS/L. In
December 1992, the Lehman Partnerships purchased an additional 104.55 shares of
Series S Preferred Stock, bringing their indirect beneficial interest in SS/L
to 18.3% of SS/L's common stock. If the Lehman Partnerships continue to hold
Series S Preferred Stock after January 1, 1998, or after a change in control of
Loral, they will have the right to request that the Company purchase their
Series S Preferred Stock at an appraised fair market value ("Appraised Value").
In such event, the Company may elect to purchase such Series S Preferred Stock
at Appraised Value, or, if the Company elects not to purchase the stock, the
Lehman Partnerships may require the combined interests of the Company and the
Lehman Partnerships in SS/L to be sold to a third party.
The Lehman Partnerships also have an aggregate equity interest of
approximately 48% in K&F Industries, Inc., a corporation of which Bernard L.
Schwartz, Chairman of the Board of Directors and Chief Executive Officer of the
Company, is a 27% stockholder and Loral is a 22.5% stockholder, which acquired
the Company's Aircraft Braking Systems and Engineered Fabrics divisions in
1989.
5
<PAGE>
USE OF PROCEEDS
The Shares of Common Stock offered hereby will be sold on behalf of the
Selling Stockholders named herein. The Company will not receive any of the
proceeds of the Offering.
UNDERWRITING
Under the terms of and subject to the conditions contained in the U.S.
Underwriting Agreement, the form of which is filed as an exhibit to the
Registration Statement of which this Prospectus forms a part, Lehman Brothers
Inc. (the "U.S. Underwriter") has agreed to purchase from the Selling
Stockholders, and the Selling Stockholders have agreed, severally but not
jointly, to sell to the U.S. Underwriter 2,654,960 shares of Common Stock.
Under the terms of and subject to the conditions contained in the
International Underwriting Agreement, the form of which is filed as an exhibit
to the Registration Statement of which this Prospectus forms a part, Lehman
Brothers International (Europe) (the "International Manager") has agreed to
purchase from the Selling Stockholders, and the Selling Stockholders have
agreed, severally but not jointly, to sell to the International Manager 660,000
shares of Common Stock.
The U.S. Underwriting Agreement and the International Underwriting Agreement
(collectively, the "Underwriting Agreements") provide that the obligations of
the U.S. Underwriter and the International Manager to pay for and accept
delivery of the shares of Common Stock offered pursuant to the Offerings are
subject to certain conditions contained therein, and that, if any of the
foregoing shares of Common Stock are purchased by the U.S. Underwriter pursuant
to the U.S. Underwriting Agreement or by the International Manager pursuant to
the International Underwriting Agreement, all the shares of Common Stock agreed
to be purchased by either the U.S. Underwriter or the International Manager, as
the case may be, pursuant to their respective Underwriting Agreements, must be
so purchased. The closing under the International Underwriting Agreement is a
condition to the closing under the U.S. Underwriting Agreement, and the closing
under the U.S. Underwriting Agreement is a condition to the closing under the
International Underwriting Agreement. The offering price and underwriting
discounts and commissions for each of the Offerings are identical.
The Company and the Selling Stockholders have been advised that the U.S.
Underwriter and the International Manager propose to offer part of the shares
of Common Stock to the public at the public offering price set forth on the
cover page of this Prospectus and part to certain dealers at such public
offering price less a concession not in excess of $ per share. The U.S.
Underwriter and the International Manager may allow and such dealers may
reallow a concession not in excess of $ per share to certain other brokers
or dealers. After the initial offering to the public, the offering price and
other selling terms may be changed by the U.S. Underwriter and the
International Manager.
The U.S. Underwriter and the International Manager have entered into an
Agreement Between U.S. Underwriter and International Manager (the "Agreement
Among"), pursuant to which the U.S. Underwriter has agreed that, as part of the
distribution of the shares of Common Stock offered in the United States and
Canada, (i) it is not purchasing any such shares for the account of anyone
other than a U.S. or Canadian Person (as defined below) and (ii) it has not
offered or sold, and will not offer, sell, resell or deliver, directly or
indirectly, any of such shares or distribute any prospectus relating to such
shares to anyone other than a U.S. or Canadian Person. In addition, pursuant to
the Agreement Among, the International Manager has agreed that, as part of the
distribution of the shares of Common Stock offered in the International
Offering, (i) it is not purchasing any such shares for the account of a U.S. or
Canadian Person and (ii) it has not offered or sold, and will not offer, sell,
resell or deliver, directly or indirectly, any of such shares or distribute any
prospectus relating to such shares to any U.S. or Canadian Person. The
International Manager has also agreed that it will offer to sell shares only in
compliance with all relevant requirements of any applicable laws.
6
<PAGE>
The foregoing limitations do not apply to stabilization transactions or to
certain other transactions specified in the Underwriting Agreements and the
Agreement Among, including (i) certain purchases and sales between the U.S.
Underwriter and the International Manager; (ii) certain offers, sales, resales,
deliveries or distributions to or through investment advisors or other persons
exercising investment discretion; and (iii) other transactions specifically
approved by the U.S. Underwriter and the International Manager. As used herein,
"U.S. or Canadian Person" means any resident or citizen of the United States or
Canada, any corporation, partnership or other entity created or organized in or
under the laws of the United States or Canada or any political subdivision
thereof or any estate or trust the income of which is subject to United States
federal income taxation or Canadian income taxation regardless of the source
(other than the foreign branch of any U.S. or Canadian Person), and includes
any United States or Canadian branch of a person other than a U.S. or Canadian
Person. The term "United States" means the United States of America (including
the states thereof and the District of Columbia) and its territories, its
possessions and other areas subject to its jurisdiction, and the term "Canada"
means Canada, its provinces, territories, possessions and other areas subject
to its jurisdiction.
Pursuant to the Agreement Among, sales may be made between the U.S.
Underwriter and the International Manager of such number of shares of Common
Stock as may be mutually agreed upon. The price of any shares sold shall be the
public offering price then in effect for Common Stock being sold by the U.S.
Underwriter and the International Manager, less the selling concession unless
otherwise determined by mutual agreement. To the extent that there are sales
between the U.S. Underwriter and the International Manager pursuant to the
Agreement Among, the number of shares initially available for sale by the U.S.
Underwriter or by the International Manager may be more or less than the
account appearing on the cover page of this Prospectus.
This prospectus is not, and under no circumstances is to be construed as, an
advertisement or a public offering of the Common Stock in Canada or any
province or territory thereof. Any offer or sale of the shares of Common Stock
in Canada may only be made pursuant to an exemption from the requirement to
file a prospectus in the province or territory of Canada in which such offer or
sale is made.
The International Manager has represented and agreed that: (i) it has not
offered or sold, and will not offer or sell, in the United Kingdom, by means of
any document, any shares of Common Stock other than to persons whose ordinary
business it is to buy or sell shares or debentures, whether as principal or
agent (except under circumstances which do not constitute an offer to the
public within the meaning of the Companies Act 1985); (ii) it has complied and
will comply with all applicable provisions of the Financial Services Act 1986
with respect to anything done by it in relation to the Common Stock in, from or
otherwise involving the United Kingdom; and (iii) it has only issued or passed
on, and will only issue or pass on, to any person in the United Kingdom, any
document received by it in connection with the issue of the Common Stock if
that person is of a kind described in Article 9(3) of the Financial Services
Act 1986 (Investment Advertisements) (Exemptions) Order 1988 (as amended).
No action has been taken or will be taken in any jurisdiction by the Company,
the Selling Stockholders or the International Manager that would permit a
public offering of the shares offered pursuant to the Offerings in any
jurisdiction where action for that purpose is required, other than the United
States. Persons into whose possession this Prospectus comes are required by the
Company and the International Manager to inform themselves about and to observe
any restrictions as to the offering of the shares offered pursuant to the
Offerings and the distribution of this Prospectus.
Purchasers of the shares of Common Stock offered hereby may be required to
pay stamp taxes and other charges in accordance with the laws and practices of
the country of purchase in addition to the offering price set forth on the
cover page hereof.
The Company and the Selling Stockholders have agreed to indemnify the U.S.
Underwriter and International Manager against certain liabilities, including
liabilities under the Securities Act, and to
7
<PAGE>
contribute to payments that the U.S. Underwriter or the International Manager
may be required to make in respect thereof.
The Lehman Partnerships are affiliates of Lehman Brothers Inc. and Lehman
Brothers International (Europe), the underwriters in the Offerings. Certain
affiliates of Lehman Brothers Inc. and Lehman Brothers International (Europe)
may be deemed for certain purposes to be beneficial owners of the shares of
Common Stock held by the Lehman Partnerships (which own the Loral Common Stock
offered hereby) and will receive a portion of the proceeds of the Offerings.
From time to time, Lehman Brothers Inc. has provided investment banking,
underwriting, financial advisory and other services to the Company and its
affiliates (including Globalstar Telecommunications Limited for which Lehman
Brothers Inc. has acted as underwriter and acts as a market maker) and to the
Selling Stockholders, for which services Lehman Brothers Inc. has received
customary indemnification rights, underwriting discounts and fees.
LEGAL OPINIONS
Certain matters relating to the Common Stock will be passed upon for the
Company by Willkie Farr & Gallagher, New York, New York, for the Merchant
Banking Partnership and Capital Partners by Steven Berkenfeld, Senior Vice
President and Associate General Counsel, Lehman Brothers Inc. and for the
Offshore Partnership and the Japan Partnership by Conyers Dill & Pearman,
Hamilton, Bermuda. Certain legal matters will be passed upon for the
Underwriters by Cravath, Swaine & Moore, New York, New York. Mr. Robert B.
Hodes, a Director and member of the Company's Executive, Audit and Government
Compliance and Compensation and Stock Option Committees, is a partner in the
law firm of Willkie Farr & Gallagher. As of May 31, 1995, Mr. Hodes owned in
the aggregate 4,400 shares of Common Stock (including 400 shares, of which he
disclaims beneficial ownership, owned by a minor child) and options to purchase
10,000 shares of Common Stock.
EXPERTS
The consolidated balance sheets of the Company as of March 31, 1995 and 1994
and related consolidated statements of operations, shareholders' equity and
cash flows for each of the three years in the period ended March 31, 1995 are
incorporated by reference herein in reliance on the report of Coopers & Lybrand
L.L.P., independent auditors, given on the authority of said firm as experts in
accounting and auditing.
The combined balance sheets of Unisys Defense Systems (a unit of Unisys
Corporation) as of December 31, 1994 and 1993 and the related combined
statements of income and cash flows for each of the two years in the period
ended December 31, 1994 included in Loral Corporation's Form 8-K filed on May
22, 1995 have been audited by Ernst & Young LLP, independent auditors, as set
forth in their report thereon included therein and incorporated herein by
reference. Such combined financial statements are incorporated herein by
reference in reliance upon such report given upon the authority of such firm as
experts in accounting and auditing.
8
<PAGE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
NO DEALER, SALESMAN OR ANY OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY IN-
FORMATION OR TO MAKE ANY REPRESENTATIONS NOT CONTAINED IN THIS PROSPECTUS,
AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED
UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY, THE SELLING STOCKHOLDERS OR THE
U.S. UNDERWRITER. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER OF ANY SECURI-
TIES OTHER THAN THOSE TO WHICH IT RELATES OR AN OFFER TO SELL, OR A SOLICITA-
TION OF AN OFFER TO BUY, TO ANY PERSON IN ANY JURISDICTION WHERE SUCH AN OFFER
OR SOLICITATION WOULD BE UNLAWFUL. NEITHER THE DELIVERY OF THIS PROSPECTUS NOR
ANY SALE MADE HEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION
THAT THE INFORMATION CONTAINED HEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO
THE DATE HEREOF.
-------------------
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C>
Available Information...................................................... 2
Incorporation of Certain Information By Reference.......................... 2
The Company................................................................ 3
Selected Financial Data.................................................... 4
Selling Stockholders....................................................... 5
Use of Proceeds............................................................ 6
Underwriting............................................................... 6
Legal Opinions............................................................. 8
Experts.................................................................... 8
</TABLE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
3,314,960 SHARES
[LORAL CORPORATION LOGO]
COMMON STOCK
-------------------
PROSPECTUS
June , 1995
-------------------
LEHMAN BROTHERS
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
<PAGE>
[ALTERNATE PAGE FOR INTERNATIONAL PROSPECTUS]
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
+INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A +
+REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE +
+SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY +
+OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT +
+BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR +
+THE SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE +
+SECURITIES IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE +
+UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF +
+ANY SUCH STATE. +
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
SUBJECT TO COMPLETION, DATED MAY 31, 1995
PROSPECTUS
3,314,960 SHARES
[LORAL CORPORATION LOGO]
COMMON STOCK
-------------
All of the 3,314,960 shares of Common Stock, $0.25 par value (the "Common
Stock"), of Loral Corporation ("Loral" or the "Company") offered hereby are
offered by the Selling Stockholders (as defined herein). Of such shares,
660,000 shares are being offered initially outside the United States and Canada
by the International Manager (as defined herein) (the "International Offering")
and 2,654,960 shares are being offered concurrently in the United States and
Canada by the U.S. Underwriter (as defined herein) (the "U.S. Offering"). Such
offerings are referred to collectively as the "Offerings." The offering price
and underwriting discounts and commissions for the International Offering and
the United States Offering will be identical. The Company will not receive any
of the proceeds from the sale of the shares offered hereby. See "Selling
Stockholders" and "Underwriting."
The Common Stock is listed on the New York Stock Exchange ("NYSE") under the
symbol "LOR." On June , 1995, the closing price of the Common Stock on the
NYSE Composite Tape was $ per share.
-------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Underwriting
Price to Discounts and Proceeds to
Public Commissions(1) Selling Stockholders
- --------------------------------------------------------------------------------
<S> <C> <C> <C>
Per Share......................... $ $ $
- --------------------------------------------------------------------------------
Total............................. $ $ $
</TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(1) The Company and the Selling Stockholders have agreed to indemnify the
International Manager and the U.S. Underwriter against certain liabilities,
including liabilities under the Securities Act of 1933. See "Underwriting."
-------------
The shares of Common Stock offered by this Prospectus are offered by the
International Manager subject to prior sale, to withdrawal, cancellation or
modification of the offer without notice, to delivery to and acceptance by the
International Manager and to certain further conditions. It is expected that
delivery of the certificates for the shares will be made at the offices of
Lehman Brothers Inc. in New York, New York, on or about June , 1995.
-------------
LEHMAN BROTHERS
June , 1995
<PAGE>
[ALTERNATE PAGE FOR INTERNATIONAL PROSPECTUS]
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
NO DEALER, SALESMAN OR ANY OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFOR-
MATION OR TO MAKE ANY REPRESENTATIONS NOT CONTAINED IN THIS PROSPECTUS, AND, IF
GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS
HAVING BEEN AUTHORIZED BY THE COMPANY, THE SELLING STOCKHOLDERS OR THE INTERNA-
TIONAL MANAGER. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER OF ANY SECURITIES
OTHER THAN THOSE TO WHICH IT RELATES OR AN OFFER TO SELL, OR A SOLICITATION OF
AN OFFER TO BUY, TO ANY PERSON IN ANY JURISDICTION WHERE SUCH AN OFFER OR SO-
LICITATION WOULD BE UNLAWFUL. NEITHER THE DELIVERY OF THIS PROSPECTUS NOR ANY
SALE MADE HEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION THAT
THE INFORMATION CONTAINED HEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO THE
DATE HEREOF.
-----------------
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C>
Available Information...................................................... 2
Incorporation of Certain Information By Reference.......................... 2
The Company................................................................ 3
Selected Financial Data.................................................... 4
Selling Stockholders....................................................... 5
Use of Proceeds............................................................ 6
Underwriting............................................................... 6
Legal Opinions............................................................. 8
Experts.................................................................... 8
</TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
3,314,960 SHARES
[LORAL CORPORATION LOGO]
COMMON STOCK
-----------------
PROSPECTUS
June , 1995
-----------------
LEHMAN BROTHERS
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The following table sets forth the estimated expenses of the Company in
connection with the issuance and distribution of the securities being
registered, other than underwriting compensation:
<TABLE>
<S> <C>
Securities and Exchange Commission registration fee............. $ 53,083
Printing Registration Statement, Prospectuses and related docu-
ments.......................................................... 25,000
Accounting fees and expenses.................................... 5,000
Legal fees and expenses......................................... 45,000
Blue Sky fees and expenses...................................... 10,000
Miscellaneous................................................... 2,500
--------
Total......................................................... $140,583
========
</TABLE>
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Sections 721-726 of the New York Business Corporation Law contain non-
exclusive provisions for indemnification of officers and directors of a
corporation under certain specified conditions, including in part: (a)
indemnification against judgments, fines, amounts paid in settlement of, and
reasonable expenses incurred as a result of, an action or proceeding, whether
civil or criminal, threatened or brought against such person (other than by one
bringing an action by or in the right of the corporation, but including an
action by or in the right of any other corporation, partnership, joint venture,
trust, employee benefit plan or other enterprise which such person served in
any capacity at the request of the corporation) if such person acted in good
faith, for a purpose which he reasonably believed to be in, or, in the case of
service for any other corporation, partnership, joint venture, trust, employee
benefit plan or other enterprise, not opposed to, the best interests of the
corporation, and, in criminal actions or proceedings, in addition, had no
reasonable cause to believe that his conduct was unlawful; (b) indemnification
against amounts paid in settlement and reasonable expenses incurred by such
person in connection with the defense or settlement of an action by or in the
right of the corporation if such director or officer acted, in good faith, for
a purpose which he reasonably believed to be in, or, in the case of service for
any other corporation or any partnership, joint venture, trust, employee
benefit plan or other enterprise, not opposed to, the best interests of the
corporation, except that no indemnification shall be made in respect of (1) a
threatened action, or a pending action which is settled or otherwise disposed
of, or (2) any claim, issue or matter as to which such person shall have been
adjudged to be liable to the corporation, unless and only to the extent that
the court, or if no action was brought, a court of competent jurisdiction,
determines the person is fairly and reasonably entitled to indemnity; and (c)
notwithstanding the failure of a corporation to provide indemnification,
indemnification pursuant to court order.
Article Ninth of the Company's Restated Certificate of Incorporation provides
that any person made a party to any action, suit or proceeding by reason of the
fact that he, his testator or intestate, is or was a director, officer or
employee of the Company or of any corporation for which he served as such at
the request of the Company, shall be indemnified by the Company against the
reasonable expenses, including attorneys' fees, actually and necessarily
incurred by him in connection with the defense of such action, suit or
proceeding, or in connection with any appeal therein, except in relation to
matters as to which it shall be adjudged in such action, suit or proceeding
that such officer, director or employee is liable for negligence or misconduct
in the performance of his duties. Such right of indemnification shall not be
deemed exclusive of any other rights to which such director, officer or
employee may be entitled apart from the indemnification provisions of said
Article Ninth. Any amount payable by way of indemnity, whether the action, suit
or proceeding reaches final judgment, or is settled with court approval before
final judgment, shall be determined and paid in accordance with the then
applicable provisions of the statutes of the State of New York, provided,
II-1
<PAGE>
however, that if such amount is paid other than pursuant to court order or
action by stockholders, the Company shall within eighteen months from the date
of such payment mail to its stockholders of record at the time entitled to vote
for the election of directors a statement specifying the persons paid, the
amount of the payments and the final disposition of the litigation.
The By-laws of the Company may enter into such contracts of indemnification
as may be authorized from time to time by the Board of Directors. The Board of
Directors has authorized, and the Company has entered into, an Indemnity
Agreement with each of the Company's directors and executive officers. The
Indemnity Agreements provide that the Company will pay on behalf of the
indemnitees any amount which he is or becomes legally obligated to pay as a
result of any claim or claims threatened or made against him as a result of any
act or omission or neglect or breach of duty he commits or suffers while acting
in his capacity as a director or officer of the Company, including any damages,
judgments, settlements and costs, reasonable costs of investigation and
reasonable costs of defense of legal actions, claims or proceedings and appeals
therefrom, and costs of attachment or similar bonds.
The Company has purchased insurance from the Reliance Insurance Company,
insuring the Company against obligations it might incur as a result of its
indemnification of its officers and directors for certain liabilities they
might incur, and insuring such officers and directors for additional
liabilities against which they might not be indemnified by the Company. The
insurance expires on April 1, 1996, and costs $306,000 per annum.
Reference is made to Section 9 of each of the U.S. Underwriting Agreement and
the International Underwriting Agreement, copies of which are filed as Exhibit
1.1 and Exhibit 1.2., respectively, to the Registration Statement.
ITEM 16. EXHIBITS.
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION OF DOCUMENT
------- -----------------------
<C> <S>
1.1 Form of proposed U.S. Underwriting Agreement.
1.2 Form of proposed International Underwriting Agreement.
3.1 Registrant's Restated Certificate of Incorporation.
3.2 Registrant's By-laws (incorporated by reference to the Company's
Annual Report on Form 10-K for fiscal year ended March 31, 1994,
Exhibit 3.2).
5 Opinion of Willkie Farr & Gallagher.
23.1 Consent of Coopers & Lybrand L.L.P.
23.2 Consent of Ernst & Young LLP.
23.3 Consent of Willkie Farr & Gallagher (included in their opinion filed
as Exhibit 5 hereto).
24 Powers of Attorney.
</TABLE>
ITEM 17. UNDERTAKINGS.
The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to section 13(a) or section 15(d) of the
Securities Exchange Act of 1934 that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
The undersigned registrant hereby undertakes that:
(1) For purposes of determining any liability under the Securities Act of
1933, the information omitted from the form of prospectus filed as a part
of this registration statement in reliance upon Rule 430A and contained in
a form of prospectus filed by the registrant pursuant to Rule 424(b)(1) or
(4) or 497(h) under the Securities Act shall be deemed to be part of this
registration statement as of the time it was declared effective.
(2) For the purpose of determining any liability under the Securities Act
of 1933, each post-effective amendment that contains a form of prospectus
shall be deemed to be a new registration statement
II-2
<PAGE>
relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide
offering thereof.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of the
registrant pursuant to the provisions described under item 15 above, or
otherwise, the registrant has been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against public
policy as expressed in the Act and is, therefore, unenforceable. In the event
that a claim for indemnification against such liabilities (other than the
payment by the registrant of expenses incurred or paid by a director, officer
or controlling person of the registrant in the successful defense of any
action, suit or proceeding) is asserted by such director, officer or
controlling person in connection with the securities being registered, the
registrant will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of appropriate jurisdiction
the question whether such indemnification by it is against public policy as
expressed in the Act and will be governed by the final adjudication of such
issue.
II-3
<PAGE>
SIGNATURES
PURSUANT TO THE REQUIREMENT OF THE SECURITIES ACT OF 1933, THE REGISTRANT
CERTIFIES THAT IT HAS REASONABLE GROUNDS TO BELIEVE THAT IT MEETS ALL OF THE
REQUIREMENTS FOR FILING ON FORM S-3 AND HAS DULY CAUSED THIS REGISTRATION
STATEMENT TO BE SIGNED ON ITS BEHALF BY THE UNDERSIGNED, THEREUNTO DULY
AUTHORIZED, IN THE CITY OF NEW YORK, STATE OF NEW YORK, ON THE 30TH DAY OF MAY,
1995.
Loral Corporation
/s/ Michael B. Targoff
By: _________________________________
Title: Senior Vice President
and Secretary
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS REGISTRATION
STATEMENT HAS BEEN SIGNED BELOW ON THE 30TH DAY OF MAY, 1995 BY THE FOLLOWING
PERSONS IN THE CAPACITIES INDICATED.
SIGNATURES TITLE
* Chairman of the Board,
- ------------------------------------- Chief Executive Officer and Director
BERNARD L. SCHWARTZ
* President, Chief Operating Officer and
- ------------------------------------- Director
FRANK C. LANZA
/s/ Michael P. DeBlasio Principal Financial Officer
- -------------------------------------
MICHAEL P. DEBLASIO
/s/ Robert V. LaPenta Principal Accounting Officer
- -------------------------------------
ROBERT V. LAPENTA
* Director
- -------------------------------------
HOWARD GITTIS
* Director
- -------------------------------------
ROBERT B. HODES
* Director
- -------------------------------------
GERSHON KEKST
* Director
- -------------------------------------
CHARLES LAZARUS
II-4
<PAGE>
Director
- -------------------------------------
MALVIN A. RUDERMAN
Director
- -------------------------------------
E. DONALD SHAPIRO
* Director
- -------------------------------------
ALLEN M. SHINN
* Director
- -------------------------------------
THOMAS J. STANTON, JR.
* Director
- -------------------------------------
DANIEL YANKELOVICH
/s/ Michael B. Targoff
*By: ________________________________
MICHAEL B. TARGOFF
ATTORNEY-IN-FACT
II-5
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION OF DOCUMENT PAGE
------- ----------------------- ----
<C> <S> <C>
1.1 Form of proposed U.S. Underwriting Agreement.
1.2 Form of proposed International Underwriting Agreement.
3.1 Registrant's Restated Certificate of Incorporation.
3.2 Registrant's By-laws (incorporated by reference to the
Company's Annual Report on Form 10-K for fiscal year ended
March 31, 1994, Exhibit 3.2).
5 Opinion of Willkie Farr & Gallagher.
23.1 Consent of Coopers & Lybrand L.L.P.
23.2 Consent of Ernst & Young LLP.
23.3 Consent of Willkie Farr & Gallagher (included in their opinion
filed as Exhibit 5 hereto).
24 Powers of Attorney.
</TABLE>
<PAGE>
EXHIBIT 1.1
[Draft--5/30/95]
2,654,960 Shares
LORAL CORPORATION
Common Stock
U.S. Underwriting Agreement
---------------------------
June , 1995
LEHMAN BROTHERS INC.
3 World Financial Center
New York, New York 10285
Dear Sirs:
Each of the entities named in Schedule I hereto (the "Selling
Stockholders") proposes to sell to the several U.S. Underwriters named in
Schedule II hereto (the "U.S. Underwriters") the number of shares of Common
Stock, $.25 par value (the "Common Stock"), of Loral Corporation, a New York
corporation (the "Company"), set forth opposite its name in Schedule I,
representing an aggregate of 2,654,960 shares (the "Shares"). If the firms
listed in Schedule II hereto include only you, then the terms "U.S.
Underwriters" and "Representative", as used herein, shall each be deemed to
refer to such firm.
It is understood that the Company and the Selling Stockholders are
concurrently entering into an International Underwriting Agreement dated the
date hereof (the "International Underwriting Agreement"), providing for the sale
by the Selling Stockholders of 660,000 shares of Common Stock through
arrangements with certain underwriters outside the United States (the
"International Managers"). If the firms listed in Schedule II to the
International Underwriting Agreement include only the Lead Managers, then the
terms "International Managers" and "Lead Managers, as used herein, shall each be
deemed to refer to such firms. All shares of Common Stock to be offered by the
International Managers pursuant to the International Underwriting Agreement are
herein called the "International Shares"; the International Shares and the
Shares, collectively, are herein called the "Shares". As specified in Section
4, the respective closings under this Agreement
<PAGE>
2
and the International Underwriting Agreement are hereby expressly made
conditional on one another.
The Company and the Selling Stockholders also understand that the U.S.
Underwriters and the International Managers have entered into an agreement (the
"Agreement Between U.S. Underwriters and International Managers") contemplating
the coordination of certain transactions between the U.S. Underwriters and the
International Managers and that, pursuant thereto and subject to the conditions
set forth therein, the U.S. Underwriters may purchase from the International
Managers a portion of the International Shares or sell to the International
Managers a portion of the Shares. The Company and the Selling Stockholders
understand that any such purchases and sales between the U.S. Underwriters and
the International Managers shall be governed by the Agreement Between U.S.
Underwriters and International Managers and shall not be governed by the terms
of this Agreement or the International Underwriting Agreement.
This is to confirm the agreement concerning the purchase of the Shares
from the Selling Stockholders by the U.S. Underwriters.
The following terms as used in this Agreement shall have the following
meanings:
"Business Day" shall mean any day on which the New York Stock Exchange
------------
is open for trading.
"Effective Date" shall mean the date of the Effective Time.
--------------
"Effective Time" shall mean the date and the time as of which the
--------------
Registration Statement, or the most recent post-effective amendment thereto, if
any, was declared effective by the Commission (or, if the Company will next file
with the Commission an amendment to the Registration Statement as contemplated
by clause (i) of the first paragraph of Section 1, the date and time as of which
the Registration Statement shall be declared effective).
"Exchange Act" shall mean the Securities Exchange Act of 1934.
------------
<PAGE>
3
"Execution Time" shall mean the date and time that this Agreement is
--------------
executed and delivered by the parties hereto.
"International Prospectus" shall mean a Prospectus relating to the
------------------------
International Shares which are to be offered and sold outside the United States
to persons other than U.S. Persons.
"Preliminary Prospectuses" shall mean each prospectus included in the
------------------------
Registration Statement, or any amendment thereof, before the Effective Date,
each prospectus filed with the Commission by the Company with the consent of the
Representatives pursuant to Rule 424(a) and each prospectus included in the
Registration Statement at the Effective Time that omits Rule 430A Information.
"Prospectuses" shall mean the forms of prospectuses relating to the
------------
Shares, as first filed pursuant to Rule 424(b) after the Execution Time or, if
no filing pursuant to Rule 424(b) is required, the forms of final prospectuses
included in the Registration Statement at the Effective Time.
"Registration Statement" shall mean the registration statement
----------------------
referred to above, as amended at the Effective Time, including any documents
incorporated by reference and any Rule 430A Information deemed to be included
therein at the Effective Time as provided by Rule 430A.
"Rule 424" and "Rule 430A" shall refer to such rules under the
-------- ---------
Securities Act.
"Rule 430A Information" shall mean information with respect to the
---------------------
Shares and the offering thereof permitted to be omitted from the Registration
Statement when it becomes effective pursuant to Rule 430A.
"Rules and Regulations" shall mean the rules and regulations in effect
---------------------
at any relevant time adopted by the Commission under the Securities Act or the
Exchange Act.
"Subsidiary" and "Significant Subsidiary" shall have the meanings
---------- ----------------------
assigned in Rule 405 of the Rules and Regulations. As used in reference to the
Company, "subsidiary" shall mean a Subsidiary of the Company.
----------
<PAGE>
4
"U.S. Person" shall mean any resident or national of the United
-----------
States, any corporation, partnership or other entity created or organized in or
under the laws of the United States or any estate or trust the income of which
is subject to United States income taxation regardless of the source of its
income (other than the foreign branch of any U.S. Person), and includes any
United States branch of a person other than a U.S. Person; and "United States"
-------------
shall mean the United States of America (including the states thereof and the
District of Columbia) and its territories, its possessions and other areas
subject to its jurisdiction.
"U.S. Prospectus" shall mean a Prospectus relating to the Shares which
---------------
are to be offered and sold in the United States or to U.S. Persons.
Reference made herein to any Preliminary Prospectus or to the Prospectuses shall
be deemed to refer to and include any documents incorporated by reference
therein pursuant to Item 12 of Form S-3 under the Securities Act, as of the date
of such Preliminary Prospectus or the Prospectuses and any reference to any
amendment or supplement to any Preliminary Prospectus or the Prospectuses shall
be deemed to refer to and include any document filed under the Exchange Act
after the date of such Preliminary Prospectus or the Prospectuses and
incorporated by reference in such Preliminary Prospectus or the Prospectuses.
1. Registration Statement. A registration statement on Form S-3
-----------------------
(File No. 33- ) with respect to the Shares has been prepared by the Company
in conformity with the requirements of the Securities Act of 1933 (the
"Securities Act") and the Rules and Regulations of the Securities and Exchange
Commission (the "Commission") thereunder and has been filed with the Commission
under the Securities Act. Copies of such registration statement as amended to
date have been delivered by the Company to you as the Representatives of the
U.S. Underwriters. The Company will next file with the Commission one of the
following: (i) prior to effectiveness of such registration statement, a further
amendment to such registration statement, including forms of final prospectuses
or (ii) after effectiveness of such registration statement, final prospectuses
in accordance with Rules 430A and 424(b)(1) or (4).
<PAGE>
5
2. Representations, Warranties and Agreements of the Company. The
----------------------------------------------------------
Company represents, warrants and agrees that:
(a) On the Effective Date, the Registration Statement did or will,
and when the Prospectuses are first filed (if required) in accordance with Rule
424(b) and on the Closing Date (as defined in Section 5) the Prospectuses (and
any supplements thereto) will, comply in all material respects with the
applicable requirements of the Securities Act and the Rules and Regulations.
The Company has included in the Registration Statement, as amended at the
Effective Date, all information required by the Securities Act and the Rules and
Regulations thereunder to be included in the Prospectuses with respect to the
Shares and the offering thereof, and the Prospectuses, when filed with the
Commission, did or will contain all Rule 430A Information, together with all
other such required information, with respect to the Shares and the offering
thereof and, except to the extent the Representatives shall agree in writing to
a modification, shall be in all substantive respects in the form furnished to
you prior to the Execution Time or, to the extent not completed at the Execution
Time, shall contain only such specific additional information and other changes
(beyond that contained in the latest Preliminary Prospectuses) as the Company
has advised you, prior to the Execution Time, will be included or made therein.
The Commission has not issued any stop order preventing or suspending the use of
any Preliminary Prospectus or the Prospectuses or the effectiveness of the
Registration Statement, and no proceeding for any such purpose has been
initiated or threatened by the Commission.
(b) On the Effective Date, the Registration Statement did not or will
not contain any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary in order to make the
statements therein not misleading; and, on the Effective Date, the Prospectuses
did not or will not, and on the date of any filing pursuant to Rule 424(b) and
on the Closing Date, the Prospectuses (together with any supplement thereto)
will not, include any untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading; provided that the
Company makes no representation or warranty as to information contained in or
omitted from the Registration Statement or the Prospectuses in reliance upon,
<PAGE>
6
and in conformity with, written information furnished to the Company by you, or
by any U.S. Underwriter through you, specifically for inclusion therein.
(c) The documents incorporated by reference in the Prospectuses, when
they were filed with the Commission (or upon amendment thereof by other
documents included in such incorporated documents), conformed in all material
respects to the requirements of the Securities Act or Exchange Act, as
applicable, and the Rules and Regulations thereunder, and such documents were
timely filed as required thereby and none of such documents contained an untrue
statement of a material fact or omitted to state a material fact required to be
stated therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading; and any further
documents so filed and incorporated by reference in the Prospectuses, when such
documents become effective or are filed with Commission will conform in all
material respects to the requirements of the Securities Act or the Exchange Act,
as applicable, and the Rules and Regulations thereunder, and will be timely
filed as required thereby and will not contain an untrue statement of a material
fact or omit to state a material fact required to be stated therein or necessary
to make the statements therein not misleading.
(d) The accountants who certified the consolidated financial
statements and supporting schedules included in or incorporated by reference in
the Registration Statement, any Preliminary Prospectus or the Prospectuses are
independent public accountants as required by the Securities Act and the Rules
and Regulations thereunder.
(e) The consolidated financial statements and schedules (including
the related notes and supporting schedules) included in the Registration
Statement, any Preliminary Prospectus or the Prospectuses present (or in the
case of any amendment or supplement to any such document, or any material
incorporated by reference in any such document, filed with the Commission after
the date as of which this representation is made, will present) fairly and in
accordance with generally accepted accounting principles applied on a consistent
basis throughout the periods involved, the financial condition, results of
operations and changes in financial condition of the entities purported to be
shown thereby at the dates and for the periods indicated and have been or will
be, as the case may be, prepared in accordance with generally accepted
<PAGE>
7
accounting principles applied on a consistent basis throughout the periods
indicated.
(f) The pro forma condensed consolidated financial statements
incorporated by reference into the Registration Statement, any Preliminary
Prospectuses or the Prospectuses have been prepared in accordance with Article
11 of Regulation S-X of the Rules and Regulations. The Company has no reason to
believe that the assumptions upon which such pro forma financial statements are
based are inaccurate or inappropriate or that such pro forma financial
information was not prepared in conformity with the notes thereto.
(g) Since the respective dates as of which information is given in
the Registration Statement and the Prospectuses, except as otherwise stated
therein, (A) there has been no material adverse change, in the condition,
financial or otherwise, or in the earnings, assets, affairs or business
prospects of the Company and its subsidiaries, taken as a whole, whether or not
arising in the ordinary course of business, (B) there have been no transactions,
entered into by the Company or any of its subsidiaries, other than those in the
ordinary course of business, which are material with respect to the Company and
its subsidiaries considered as a whole, and (C) there has been no extraordinary
dividend or distribution of any kind declared, paid or made by the Company on
any class of its capital stock.
(h) The Company has been duly incorporated and is validly existing as
a corporation in good standing under the laws of the State of New York, and has
full corporate power and authority to own or hold its properties and to conduct
its business as described in the Registration Statement, and has been duly
qualified as a foreign corporation for the transaction of business and is in
good standing under the laws of each other jurisdiction in which it owns or
leases property, or conducts any business, so as to require such qualification
(except where the failure to so qualify would not have a material adverse effect
on the Company and its subsidiaries considered as a whole, or on the earnings,
assets, affairs or business prospects of the Company and its subsidiaries
considered as a whole).
(i) Each subsidiary of the Company listed in Exhibit 21 of the Annual
Report on Form 10-K of the Company filed with the Commission under Section 13 of
the Exchange
<PAGE>
8
Act for the fiscal year ended March 31, 1995 (the "Form 10-K Report") has been
duly incorporated and is validly existing as a corporation in good standing
under the laws of its jurisdiction of incorporation, has full corporate power
and authority to own, lease and operate its properties and conduct its business
and has been duly qualified as a foreign corporation for the transaction of
business and is in good standing under the laws of each other jurisdiction in
which it owns or leases property, or conducts any business, so as to require
such qualification (except where the failure to so qualify would not have a
material adverse effect on the condition, financial or otherwise, of the Company
and its subsidiaries considered as a whole, or on earnings, assets, affairs or
business prospects of the Company and its subsidiaries considered as a whole);
and all the issued and outstanding capital stock of each such subsidiary has
been duly authorized and validly issued, is fully paid and nonassessable and is
owned by the Company directly or through Subsidiaries, free and clear of any
mortgage, pledge, lien, encumbrance, claim or equity (except as set forth in the
notes to Exhibit 21 of the Form 10-K Report) and no holder of such stock is
subject to personal liability by reason by being such holder.
(j) Since the end of its most recently completed fiscal year, the
Company has filed all documents and amendments to previously filed documents
required to be filed by it pursuant to Section 13(a), 13(b), 14 or 15(d) of the
Exchange Act.
(k) Neither the Company nor any of its subsidiaries is in violation
of any term or provision of their respective Certificates of Incorporation or
By-laws, in each case as amended, or in default under any agreement, indenture
or instrument, the effect of which violation or default would be material to the
Company and its subsidiaries taken as a whole; and the execution, delivery and
performance of this Agreement and the International Underwriting Agreement have
been duly authorized by all necessary corporate action and will not conflict
with or result in a breach or violation of any of the terms or provisions of, or
constitute a default under, or result in the creation or imposition of any lien,
charge or encumbrance upon any of the assets of the Company or any of its
subsidiaries pursuant to the terms of any agreement, indenture or instrument, or
result in a violation of the provisions of the Certificate of Incorporation or
the By-laws, in each case as amended, of the Company or any of its
<PAGE>
9
subsidiaries (the effect of which conflict, lien, charge, encumbrance, default
or violation would be material to the Company and the subsidiaries taken as a
whole, or would materially and adversely affect the ability of the Company to
perform under this Agreement or the International Underwriting Agreement nor
will the performance by the Company of its obligations hereunder violate any
law, rule, administrative regulation or decree of any court or governmental
agency having jurisdiction over the Company, any of its subsidiaries or their
respective properties; and no consent, approval, authorization, order,
registration, filing or qualification of or with any court or governmental
agency or body is required for the sale of the Shares or the consummation of the
other transactions contemplated by this Agreement or the International
Underwriting Agreement, except the registration under the Securities Act of the
Shares, and such consents, approvals, authorizations, registrations, filings or
qualifications as may be required under state securities or Blue Sky laws or as
may be required by the laws of any country other than the United States in
connection with the purchase and distribution of the Shares by the U.S.
Underwriters.
(1) There is no action, suit or proceeding before or by any court or
governmental agency or body, domestic or foreign, now pending, or to the
knowledge of the Company, threatened against or affecting the Company or any of
its subsidiaries which is required to be disclosed in the Registration Statement
(other than as disclosed therein) or might result in any material adverse change
in the condition, financial or otherwise, or in the earnings, assets, affairs or
business prospects of the Company and its subsidiaries considered as a whole, or
which might materially and adversely affect the properties and assets thereof or
which might materially and adversely affect the consummation of the transactions
contemplated by this Agreement and the International Underwriting Agreement; all
pending legal or governmental proceedings to which the Company or any of its
subsidiaries is a party or of which any of their property is subject which are
not described in the Registration Statement, including ordinary routine
litigation incidental to the business, are, considered in the aggregate, not
material with respect to the Company and its subsidiaries considered as a whole;
and there are no contracts or other documents of the Company or any of its
subsidiaries which are required to be filed as exhibits to the Registration
Statement or to any document incorporated by reference therein which have not
been so filed.
<PAGE>
10
(m) The Company and its subsidiaries own or possess such
certificates, authorizations or permits issued by the appropriate state, federal
or foreign regulatory agencies or bodies, the absence of which would have a
material adverse effect on the business now operated by them, and neither the
Company nor any of its subsidiaries has received any notice of proceeding
relating to the revocation or modification of any such certificate, authority or
permit which, singly or in the aggregate, if the subject of an unfavorable
decision, ruling, or finding would materially and adversely affect the conduct
of business, operations, financial condition or income of the Company and its
subsidiaries considered as a whole.
(n) There are no holders of securities of the Company who, by reason
of the filing of the Registration Statement or the Preliminary Prospectuses or
the Prospectuses under the Securities Act, have the right to request the Company
to register under the Securities Act securities held by them, other than rights
which have been waived or satisfied.
(o) All outstanding shares of Common Stock, including the Shares,
have been duly and validly authorized and are validly issued, fully paid and
nonassessable. There are no preemptive rights to subscribe for or to purchase,
or any restriction upon the voting or transfer of, any Shares pursuant to the
Company's corporate charter, by-laws or any agreement or other instrument to
which the Company or any of its subsidiaries is a party or by which it may be
bound; the Common Stock, including the Shares, are listed on the New York Stock
Exchange. The capitalization of the Company as of March 31, 1995 is as set
forth in the Registration Statement.
(p) This Agreement has been duly authorized, executed and delivered
by the Company.
(q) Neither the Company nor any subsidiary has taken and neither
shall take, directly or indirectly, any action designed to cause or result in,
or which has constituted or which might reasonably be expected to constitute,
the stabilization or manipulation of the price of the shares of Common Stock to
facilitate the sale or resale of the Shares.
<PAGE>
11
(r) The conditions for the use of Form S-3, as set forth in the
General Instructions thereto in connection with the offering of the Shares, have
been satisfied.
3. Representations, Warranties and Agreements of the Selling
---------------------------------------------------------
Stockholders. Each Selling Stockholder represents, warrants and agrees that:
- -------------
(a) The Selling Stockholder has, and immediately prior to the Closing
Date (as defined in Section 5 hereof) the Selling Stockholder will have, good
and marketable title to the Shares to be sold by the Selling Stockholder
hereunder and under the International Underwriting Agreement on such date, free
and clear of all liens, encumbrances, equities or claims; and upon delivery of
such Shares and payment therefor pursuant hereto and thereto, good and
marketable title to such shares, free and clear of all liens, encumbrances,
equities or claims (except such as may be created by the U.S. Underwriters or
International Managers), will pass to the several U.S. Underwriters and the
International Managers.
(b) The Selling Stockholder has full right, power and authority to
enter into and perform under this Agreement and the International Underwriting
Agreement; the execution, delivery and performance of this Agreement and the
International Underwriting Agreement by the Selling Stockholder and the
consummation by the Selling Stockholder of the transactions contemplated herein
and therein will not conflict with or result in a breach or violation of any of
the terms or provisions of, or constitute a default under, any charter,
partnership agreement, by-laws, standstill agreement, indenture, mortgage, deed
of trust, loan agreement or other agreement or instrument to which the Selling
Stockholder is a party or by which the Selling Stockholder is bound or to which
any of the property or assets of the Selling Stockholder is subject, nor will
such actions, to the knowledge of the Selling Stockholder, result in any
violation of the provisions of any statute or any order, rule or regulation of
any court or governmental agency or body having jurisdiction over the Selling
Stockholder or the property or assets of the Selling Stockholder; and no
consent, approval, authorization, order, filing or registration of or with, any
court or governmental agency or body is required for the execution, delivery and
performance of this Agreement and the International Underwriting Agreement by
the Selling Stockholder and the consummation by the Selling Stockholder of the
transactions
<PAGE>
12
contemplated herein and therein, except the registration under the Securities
Act of the Shares, such consents, approvals, authorizations, registrations,
filings or qualifications as may be required under state securities or Blue Sky
laws in connection with the purchase and distribution of the Shares by the U.S.
Underwriters, and amendments to filings made under the Exchange Act.
(c) All written information related to such Selling Stockholder
furnished to the Company by the Selling Stockholder specifically for use in the
Registration Statement, any Preliminary Prospectuses, the Prospectuses or any
amendment or supplement thereto does not, or at the Effective Time will not,
contain any untrue statement of a material fact or omit to state any material
fact required to be stated therein or necessary to make the statements therein
not misleading.
(d) The Selling Stockholders have not taken and will not take,
directly or indirectly, any action which is designed to or which has constituted
or which might reasonably be expected to cause or result in the stabilization or
manipulation of the price of any security of the Company to facilitate the sale
or resale of the Shares.
4. Purchase of the Shares by the U.S. Underwriters. Subject to the
-------------------------------------------------
terms and conditions and upon the basis of the representations and warranties
herein set forth, each of the Selling Stockholders agrees, severally and not
jointly, to sell to the U.S. Underwriters the number of Shares set forth
opposite such Selling Stockholder's name in Schedule I, and each of the U.S.
Underwriters agrees, severally and not jointly, to purchase, at a price of $[
] per Share, the number of Shares set forth opposite such U.S. Underwriter's
name in Schedule II hereto. Each U.S. Underwriter shall be obligated to
purchase from each Selling Stockholder that number of the Shares which
represents the same proportion of the number of the Shares to be sold by the
Selling Stockholders as the number of the Shares set forth opposite the name of
such U.S. Underwriter in Schedule II represents of the total number of the
Shares to be purchased by all the Underwriters pursuant to this Agreement. The
respective purchase obligations of the U.S. Underwriters with respect to the
Shares shall be rounded among the U.S. Underwriters to avoid fractional shares.
The U.S. Underwriters agree to offer the Shares to the public as set forth in
the U.S. Prospectus. Each U.S. Underwriter
<PAGE>
13
agrees that, except to the extent permitted by the Agreement Between U.S.
Underwriters and International Managers, it will not offer any of the Shares
outside the United States.
The obligations of the Selling Stockholders to sell any Shares, and
the obligations of the U.S. Underwriters to purchase the Shares, are subject to
the closing of the sale and purchase of the International Shares pursuant to the
International Underwriting Agreement.
5. Delivery of and Payment for Shares. Delivery of certificates for
-----------------------------------
the Shares shall be made at the offices of Lehman Brothers Inc., 388 Greenwich
Street (Cashier's Window, Main Level), New York, New York 10013 (or such other
place as mutually may be agreed upon), at 10:00 A.M., New York City time, on the
[third] full Business Day following the date of this Agreement or on such later
date as shall be determined by you and the Company (the "Closing Date").
Delivery of certificates for the Shares shall be made by or on behalf
of the Selling Stockholders to you, for the respective accounts of the U.S.
Underwriters, against payment of the purchase price therefor by certified or
official bank check payable in New York Clearing House funds to the order of the
relevant Selling Stockholder. The certificates for the Shares shall be
registered in such names and denominations as you shall have requested at least
two full Business Days prior to the Closing Date, and shall be made available
for checking and packaging in New York, New York, or such other location as may
be designated by you at least one full Business Day prior to the Closing Date.
Time shall be of the essence, and delivery of certificates for the Shares at the
time and place specified in this Agreement is a further condition to the
obligations of each U.S. Underwriter.
6. Covenants. The Company covenants and agrees with each U.S.
----------
Underwriter that:
(a) The Company shall use its best efforts to cause the Registration
Statement, if not effective at the Execution Time, and any amendments thereto to
become effective. The Company shall advise you promptly of the filing of any
amendment to the Registration Statement or any supplement to any Prospectus and,
upon notification from the Commission that the Registration Statement or any
such amendment has become effective, shall so advise you promptly
<PAGE>
14
(in writing, if requested). If the Registration Statement has become or becomes
effective pursuant to Rule 430A, or filing of any Prospectus is otherwise
required under Rule 424(b), the Company will cause such Prospectus, properly
completed, and any supplement thereto to be filed with the Commission pursuant
to the applicable paragraph of Rule 424(b) in the manner and within the time
period prescribed and will provide evidence satisfactory to the Representative
of such timely filing. The Company shall notify you promptly of any request by
the Commission for any amendment of or supplement to the Registration Statement
or any Prospectus or for additional information; the Company shall prepare and
file with the Commission, promptly upon your request, any amendments or
supplements to the Registration Statement or the U.S. Prospectus which, in your
reasonable opinion, may be necessary or advisable in connection with the
distribution of the Shares; and the Company shall not file any amendment or
supplement to the Registration Statement or the U.S. Prospectus, or file any
document under the Exchange Act before the termination of the offering of the
Shares by the U.S. Underwriters if such document would be deemed to be
incorporated by reference into the U.S. Prospectus, which filing is not
consented to by you after reasonable notice thereof. The Company shall advise
you promptly of the issuance by the Commission or any state or other
governmental or regulatory body of any stop order or other order suspending the
effectiveness of the Registration Statement, suspending or preventing the use of
any Preliminary Prospectus or Prospectus or suspending the qualification of the
Shares for offering or sale in any jurisdiction, or of the institution of any
proceedings for any such purpose; and the Company shall use its best efforts to
prevent the issuance of any stop order or other such order and, should a stop
order or other such order be issued, to obtain as soon as possible the lifting
thereof.
(b) The Company shall furnish promptly to the Representative and to
counsel for the U.S. Underwriters one signed copy of the Registration Statement
as originally filed and each amendment thereto filed with the Commission
including all consents and exhibits filed therewith, and shall furnish to the
U.S. Underwriters such number of conformed copies of the Registration Statement,
as originally filed and each amendment thereto (excluding exhibits other than
this Agreement), any Preliminary Prospectus, the U.S. Prospectus and all
amendments and supplements to any of such documents, and any document
incorporated by reference in the Prospectuses, in each case
<PAGE>
15
as soon as available and in such quantities as the Representative may from time
to time reasonably request; and the Company authorizes the U.S. Underwriters and
all dealers to whom any Shares may be offered or sold by the several U.S.
Underwriters to use the U.S. Prospectus, and if supplemented or amended then
after such date as supplemented or amended, during the period referred to in
Section 6(a) in connection with the sale of the Shares in accordance with the
applicable provisions of the Securities Act, the Rules and Regulations
thereunder and this Agreement.
(c) Within the time during which the Prospectuses relating to the
Shares are required to be delivered under the Securities Act, the Company shall
comply with all requirements imposed upon it by the Securities Act, the Exchange
Act and the Rules and Regulations so far as is necessary to permit the
continuance of sales of or dealings in the Shares as contemplated by the
provisions hereof and by the Prospectuses. If during such period any event
occurs as a result of which the U.S. Prospectus as then amended or supplemented
would include an untrue statement of a material fact or omit to state a material
fact necessary to make the statements therein, in the light of the circumstances
then existing, not misleading, or if during such period it is necessary to amend
the Registration Statement or supplement the U.S. Prospectus to comply with the
Securities Act or the Exchange Act or the Rules and Regulations or to file any
document under the Exchange Act incorporated by reference into the U.S.
Prospectus, the Company shall promptly notify you and, subject to the
penultimate sentence of paragraph (a) of this Section 6, shall amend the
Registration Statement or supplement the U.S. Prospectus or file such document
(at the expense of the Company) so as to correct such statement or omission or
to effect such compliance.
(d) The Company shall take or cause to be taken all reasonable action
and furnish to whomever you may direct such information as may be required in
qualifying the Shares (and any International Shares that may be sold to the U.S.
Underwriters by the International Managers) for sale under the laws of such
jurisdictions as you shall designate and to continue such qualifications in
effect for as long as may be necessary for the distribution of the Shares (and
such International Shares); except that in no event shall the Company be
obligated in connection therewith to qualify as a foreign corporation or to
execute a general consent to service of process.
<PAGE>
16
(e) The Company shall make generally available to its security
holders (and shall deliver to the Representative), in the manner contemplated by
Rule 158(b) under the Securities Act or otherwise, as soon as practicable but in
any event not later than 45 days after the end of its fiscal quarter in which
the first anniversary date of the Effective Date occurs, an earnings statement
satisfying the requirements of Section 11(a) of the Securities Act and covering
a period of at least 12 consecutive months beginning after the Effective Date.
(f) The Company shall not, during the 90 days following the date of
the Prospectuses, except with the prior written consent of the Representative or
otherwise in accordance with this Agreement, offer, sell or contract to sell or
otherwise dispose of (or enter into any transaction which is designed to, or
could be expected to, result in the disposition by any person of), directly or
indirectly, or announce the offering of, any shares of Common Stock, or any
options, rights or warrants with respect to shares of Common Stock or any
securities convertible into, or exchangeable for, shares of Common Stock (except
for the issuance of shares of Common Stock pursuant to employee benefit plans or
existing options or the grant of options pursuant to employee benefit plans
("Plan Shares")). The Company shall not take, directly or indirectly, any
action designed to cause or result in, or which might reasonably be expected to
constitute, the stabilization or manipulation of the price of the shares of
Common Stock to facilitate the sale or resale of the Shares.
(g) Whether or not this Agreement becomes effective or is terminated
or the sale of the Shares to the U.S. Underwriters is consummated, the Company
shall pay or cause to be paid (i) all expenses (including stock transfer taxes)
incurred in connection with the delivery to the several U.S. Underwriters of the
Shares, (ii) all fees and expenses (including, without limitation, fees and
expenses of the Company's accountants and counsel, but excluding fees and
expenses of counsel for the U.S. Underwriters) in connection with the
preparation, printing, filing, delivery and shipping of the Registration
Statement (including the financial statements therein and all amendments and
exhibits thereto), each Preliminary Prospectus, the Prospectuses and any
amendments or supplements of the foregoing and any documents incorporated by
reference into any of the foregoing and the reproduction, delivery and shipping
of this Agreement, the International Underwriting Agreement and
<PAGE>
17
other underwriting documents, including, but not limited to, Underwriters'
Questionnaires, Underwriters' Powers of Attorney, Blue Sky Memoranda, Legal
Investment Surveys, Agreements Among Underwriters, Selected Dealer Agreements,
the Agreement Between U.S. Underwriters and International Managers, the
Agreements Among International Managers and the International Selling
Agreements, (iii) all filing fees and fees and disbursements of counsel to the
U.S. Underwriters incurred in connection with the qualification of the Shares
under state securities laws as provided in Section 6(d) hereof, (iv) the filing
fee of the National Association of Securities Dealers, Inc., if any, (v) any
applicable listing or stock exchange fees, (vi) the cost of printing
certificates representing the Shares, (vii) the cost and charges of any transfer
agent or registrar and (viii) all other costs and expenses incident to the
performance of its obligations hereunder for which provision is not otherwise
made in this Section. It is understood, however, that, except as provided in
this Section, Section 9 and Section 10 hereof, the U.S. Underwriters shall pay
all their own costs and expenses, including the fees of their counsel, stock
transfer taxes due upon resale of any of the Shares by them and any advertising
expenses incurred in connection with any offers they may make. It is further
understood that the Company shall pay such registration expenses for which it is
responsible under the Standstill Agreement (including the Registration Rights
Agreement attached thereto) dated as of August 14, 1992, as amended as of
November 13, 1992 (the "Standstill Agreement"), and the Selling Stockholders
shall pay such costs and expenses for which they are responsible under the
Standstill Agreement. If the sale of the Shares provided for herein is not
consummated by reason of acts of the Company or the Selling Stockholders
pursuant to Section 10 hereof which prevent this Agreement from becoming
effective, or by reason of any failure, refusal or inability on the part of the
Company or the Selling Stockholders to perform in all material respects any
agreement on its part to be performed or because any condition of the U.S.
Underwriters' obligations hereunder to be performed by the Company is not
fulfilled or if the U.S. Underwriters shall decline to purchase the Shares for
any reason permitted under this Agreement, the Company or the Selling
Stockholders, as the case may be, shall reimburse the several U.S. Underwriters
for all reasonable out-of-pocket disbursements (including fees and disbursements
of counsel) incurred by the U.S. Underwriters in connection with any
investigation or preparation made by them in
<PAGE>
18
respect of the marketing of the Shares or in contemplation of the performance by
them of their obligations hereunder.
(h) Until the termination of the offering of the Shares, the Company
shall timely file all documents, and any amendments to previously filed
documents, required to be filed by the Company pursuant to Section 13(a), 13(c),
14 or 15(d) of the Exchange Act.
(i) During a period of three years from the Effective Date, the
Company shall furnish to the Representative copies of all reports or other
communications furnished to shareholders and copies of any reports or financial
statements furnished to or filed with the Commission or any national securities
exchange on which any class of securities of the Company shall be listed.
7. Further Agreements of the Selling Stockholders. Each Selling
-----------------------------------------------
Stockholder covenants and agrees with each U.S. Underwriter that such Selling
Stockholder will deliver to the Representative prior to the Closing Date a
properly completed and executed United States Treasury Department Form W-9 or
Form W-8, as the case may be.
8. Conditions of U.S. Underwriters' Obligations. The respective
---------------------------------------------
obligations of the several U.S. Underwriters hereunder are subject to the
accuracy, as of the date hereof and the Closing Date (as if made at the Closing
Date), of the representations and warranties of the Company and the Selling
Stockholders contained herein, to the performance in all material respects by
the Company and the Selling Stockholders of their respective obligations
hereunder and to the following additional terms and conditions:
(a) The Registration Statement shall have become effective not later
than 11:00 A.M., New York City time, on the first full Business Day following
the date hereof (unless already effective), all post-effective amendments to the
Registration Statement shall have become effective, all filings required by Rule
424 shall have been made and no such filings shall have been made without the
consent of the Representatives; no stop order suspending the effectiveness of
the Registration Statement or any amendment or supplement thereto nor any order
directed to any document incorporated by reference shall have been issued; no
proceedings for the issuance of any such order shall have been initiated or
threatened; and any request of the Commission for additional information (to be
included in the Registration Statement or
<PAGE>
19
the Prospectuses or otherwise) shall have been disclosed to you and complied
with to your satisfaction; and after the date hereof, the Company shall not have
filed with the Commission any amendment or supplement to the Registration
Statement or the Prospectuses (or any document incorporated by reference
therein) without the consent of the Representatives, which consent will not have
been unreasonably withheld or delayed.
(b) No U.S. Underwriter or International Manager shall have
discovered and disclosed to the Company that the Registration Statement, the
Preliminary Prospectuses or the Prospectuses or any amendment or supplement
thereto, contains an untrue statement of fact that, in the opinion of counsel to
the U.S. Underwriters, is material, or omits to state a fact that, in the
opinion of counsel to the U.S. Underwriters, is material and is required to be
stated therein or is necessary to make the statements therein not misleading
except, in the case of a Preliminary Prospectus, to the extent such misstatement
or omission has been corrected in a subsequent Preliminary Prospectus or
Prospectus.
(c) All corporate proceedings and other legal matters incident to the
authorization, form and validity of this Agreement, the Shares, and the form of
the Registration Statement, the U.S. Prospectus (other than financial statements
and other financial data) and all other legal matters relating to this
Agreement, such other documents and the transactions contemplated hereby shall
be reasonably satisfactory in all material respects to counsel for the U.S.
Underwriters, and the Company shall have furnished to such counsel all documents
and information that such counsel may reasonably request to enable it to pass
upon such matters.
(d) There shall have been furnished to you a certificate, dated the
Closing Date and addressed to you, signed by the Chief Executive Officer and by
the Chief Financial Officer of the Company, certifying that the signers of said
certificate have carefully examined the Registration Statement, any Preliminary
Prospectuses and the Prospectuses, and any amendments or supplements thereto
<PAGE>
20
(including all documents incorporated by reference therein) and, to the best of
their knowledge:
(i) there has not been, since the respective dates as of which
information is given in the Registration Statement, any material adverse
change in the condition, financial or otherwise, or the earnings, assets,
affairs or business prospects of the Company and its subsidiaries
considered as a whole, whether or not arising in the ordinary course of
business, except as set forth in, or contemplated by, the Registration
Statement, any Preliminary Prospectuses and the Prospectuses.
(ii) the representations and warranties of the Company contained in
this Agreement are true and correct with the same force and effect as
though expressly made at and as of the Closing Date.
(iii) the Company has complied with all agreements and satisfied all
conditions on its part to be performed or satisfied at or prior to the
Closing Date.
(iv) no stop order suspending the effectiveness of the Registration
Statement has been issued and no proceedings for the purpose have been
initiated or threatened by the Commission.
(v) such documents do not include any untrue statement of material
fact or omit to state any material fact required to be stated therein or
necessary to make the statements therein not misleading.
The delivery of the certificate provided for in this subparagraph (d) shall be
and constitute a representation and warranty of the Company as to the facts
required in the immediately foregoing clause (i), (ii), (iii), (iv) and (v) of
this subparagraph (d) to be set forth in such certificate.
(e) At the Execution Time and on the Closing Date, you shall have
received a letter of Coopers & Lybrand, dated such date and addressed to you,
confirming that they are independent certified public accountants within the
meaning of the Securities Act and the applicable published Rules and Regulations
with respect to the Company and stating, as of the date of such letter (or, with
respect to
<PAGE>
21
matters involving changes or developments since the respective dates as of which
specified financial information is given or incorporated in the U.S. Prospectus,
as of a date not more than five Business Days prior to the date of such letter),
the conclusions and findings of such firm with respect to the financial
information and other matters covered by its letter delivered to you
concurrently with the execution of this Agreement, and confirming the
conclusions and findings set forth in such prior letter.
(f) Since the latest date as of which such condition is set forth in
the Registration Statement, the Preliminary Prospectus and the Prospectuses,
there shall have been no material adverse change in the condition, financial or
otherwise, or the earnings, affairs or business prospects of the Company and its
subsidiaries considered as a whole, except as set forth in, or clearly
contemplated by, the Registration Statement, any Preliminary Prospectuses and
the Prospectuses.
(g) On the Closing Date there shall have been furnished to you the
opinion of (addressed to the U.S. Underwriters) of Willkie Farr & Gallagher,
counsel for the Company, dated the Closing Date and in form and substance
satisfactory to counsel for the U.S. Underwriters, to the effect that:
(i) The Registration Statement is effective under the Securities Act;
any required filing of the Prospectuses and any supplements thereto
pursuant to Rule 424(b) has been made in the manner and within the time
period required by Rule 424(b); to the best of such counsel's knowledge, no
stop order suspending its effectiveness has been issued, and such counsel
does not know of any proceeding for that purpose pending or threatened by
the Commission.
(ii) At the time the Registration Statement became effective, the
Registration Statement (other than the financial statements and the notes
thereto and the supporting schedules and other financial and statistical
data derived therefrom included or incorporated by reference therein, as to
which no opinion need be rendered) complied as to form in all material
respects with the requirements of the Securities Act and the Rules and
Regulations, and the documents incorporated by reference therein, at the
time they were filed with the Commission, complied as
<PAGE>
22
to form in all material respects with the Exchange Act and the applicable
Rules and Regulations (except as aforesaid).
(iii) The Company has been duly incorporated and is validly existing
as a corporation in good standing under the laws of the State of New York
and has full corporate power and authority to own, lease and operate its
properties and conduct its business as described in the Registration
Statement.
(iv) This Agreement has been duly and validly authorized, executed
and delivered by the Company.
(v) No authorization, approval, consent or other instrument or order
of any federal or state court or federal or state governmental authority or
agency is required in connection with the sale of the Shares to the U.S.
Underwriters, except such as have been obtained under the Securities Act,
the Exchange Act and the Rules and Regulations thereunder, and except for
such as may be required under state or foreign securities laws; and the
execution and delivery of this Agreement and the consummation of the
transactions contemplated herein will not result in any violation of the
provisions of the charter or by-laws of the Company, or, to the best
knowledge and information of such counsel, any applicable law,
administrative regulation or administrative or court decree.
(vi) The authorized capital stock of the Company conforms to the
description thereof contained in the Preliminary Prospectuses and the
Prospectuses.
(vii) The Shares have been duly authorized for listing on the New
York Stock Exchange.
(viii) The Shares are duly authorized, validly issued, fully paid and
nonassessable and the certificates for the Shares are in valid and
sufficient form.
(ix) Such counsel also shall state that nothing has come to their
attention that would lead such counsel to believe that the Registration
Statement (other than the financial statements and the notes thereto and
the supporting schedules and other financial and statistical data derived
therefrom
<PAGE>
23
included or incorporated by reference therein, as to which no opinion need
be rendered), at the time it became effective, contained an untrue
statement of a material fact or omitted to state a material fact required
to be stated therein or necessary in order to make the statements therein
not misleading or that the Prospectuses at the date hereof and at the
Closing Date included an untrue statement of a material fact or omitted to
state a material fact necessary in order to make the statements therein, in
the light of the circumstances under which they were made, not misleading.
(h) On the Closing Date there shall have been furnished to you the
opinion (addressed to the U.S. Underwriters) of Michael B. Targoff, Esq., Senior
Vice President and Secretary of the Company, dated the Closing Date and in form
and substance satisfactory to counsel for the U.S. Underwriters, to the effect
that:
(i) The Company has been duly incorporated, is validly existing as a
corporation in good standing under the laws of the State of New York and
has full corporate power and authority to own, lease and operate its
properties and to conduct its business as described in the Registration
Statement.
(ii) To the best of such counsel's knowledge and information, the
Company is duly qualified to do business and is in good standing in each
jurisdiction in which its ownership or leasing of properties requires such
qualification or the conduct of its business requires such qualification
(except where the failure to so qualify would not have a material adverse
effect on the condition, financial or otherwise, of the Company and its
subsidiaries considered as a whole, or on the earnings, assets, affairs or
business prospects of the Company and its subsidiaries considered as a
whole).
(iii) Each Significant Subsidiary of the Company, each of which shall
be identified in such opinion, has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the
jurisdiction of its incorporation, and has full corporate power and
authority to own, lease and operate its properties and to conduct its
business as described in the Registration Statement; and is duly qualified
to
<PAGE>
24
do business and is in good standing in each jurisdiction in which its
ownership or leasing of properties requires such qualification or the
conduct of its business requires such qualification (except where the
failure to so qualify would not have a material adverse effect on the
condition, financial or otherwise, of the Company and its subsidiaries
considered as a whole, or on the earnings, assets, affairs or business
prospects of the Company and its subsidiaries considered as a whole); and
all the issued and outstanding capital stock of each such subsidiary has
been duly authorized and validly issued and is fully paid and
nonassessable, and, except to the extent set forth in the Registration
Statement, all such capital stock owned by the Company is, to the best of
such counsel's knowledge and information, owned free and clear of any
pledge, lien, encumbrance, claim or equity.
(iv) This Agreement and the International Underwriting Agreement have
been duly and validly authorized, executed and delivered by the Company.
(v) To the best of such counsel's knowledge and information, there
are no legal or governmental proceedings pending or threatened which are
required to be disclosed in the Registration Statement, other than those
disclosed therein, and all pending legal or governmental proceedings to
which the Company or any subsidiary is a party or to which any of their
property is subject which are not described in the Registration Statement,
including ordinary routine litigation incidental to the business, are,
considered in the aggregate, not material with respect to the Company and
its subsidiaries considered as a whole.
(vi) To the best of such counsel's knowledge and information, there
are no contracts, indentures, mortgages, loan agreements, notes, deeds of
trust, leases or other instruments required to be described or referred to
in the Registration Statement or to be filed as exhibits thereto other than
those described or referred to therein or filed or incorporated by
reference as exhibits thereto, the descriptions thereof or references
thereto are correct in all material respects, and no default exists in the
due performance or observance of any material obligation, agreement,
covenant or condition contained in any material
<PAGE>
25
contract, indenture, mortgage, loan agreement, note, deed of trust, lease
or other instrument so described, referred to, filed or incorporated by
reference.
(vii) No consent, approval, authorization, order, registration or
qualification of or with any court or any regulatory authority or other
governmental body is required in connection with the sale of the Shares,
except such as have been obtained under the Securities Act and such
consents, approvals, authorizations, registrations or qualifications as may
be required under the securities or Blue Sky laws of certain jurisdictions
or the laws of any country other than the United States; and the execution,
delivery and performance of this Agreement and the International
Underwriting Agreement, the consummation of the transactions herein and
therein contemplated, will not conflict with, or result in a breach of any
of the terms or provisions of, or constitute a default under, or result in
the creation or imposition of any lien, charge or encumbrance upon, any of
the property or assets of the Company or its subsidiaries pursuant to any
contract, indenture, mortgage, loan agreement, note, deed of trust, lease
or other instrument to which the Company or any of its subsidiaries is a
party or by which the Company or any of its subsidiaries is bound or to
which any of the property or assets of the Company or any of its
subsidiaries is subject, nor will such action result in any violation of
the provisions of the Certificate of Incorporation or the By-laws, in each
case as amended, of the Company, or any statute or any order, rule or
regulation of any court or governmental agency or body having jurisdiction
over the Company or any of its subsidiaries or any of their properties.
(viii) To the best of such counsel's knowledge, no stop order
suspending the effectiveness of the Registration Statement has been issued
and no proceedings for that purpose have been instituted or are pending or
contemplated under the Securities Act.
(ix) The authorized capital stock of the Company conforms to the
description thereof contained in the Registration Statement, and all the
outstanding shares of capital stock of the Company including the Shares
have been duly and validly authorized and issued and are fully paid and
nonassessable; there are no
<PAGE>
26
preemptive or other rights to subscribe for or to purchase, or any
restriction upon the voting or transfer of the Shares pursuant to the
Company's Certificate of Incorporation or By-laws, in each case as amended,
or, to the knowledge of such counsel, pursuant to any agreement or other
instrument to which the Company or its subsidiaries is a party or by which
any of them may be bound; and neither the filing of the Registration
Statement nor the offering of the Shares as contemplated by this Agreement
gives rise to any rights, other than those which have been waived or
satisfied, for or relating to the registration of any other shares of
Common Stock.
(x) The Registration Statement, the Prospectuses and each amendment
or supplement thereto, as of their respective effective or issue dates,
complied as to form in all material respects with the requirements of the
Securities Act and the Rules and Regulations thereunder (except, in each
case, for the financial statements and other financial data contained or
incorporated therein, as to which no opinion need be expressed), and the
documents incorporated by reference therein, at the time they were filed
with the Commission, complied as to form in all material respects with the
Exchange Act and the applicable Rules and Regulations thereunder (except as
aforesaid). In passing upon the form of the Registration Statement, the
Prospectuses and the documents incorporated by reference therein, such
counsel has necessarily assumed the correctness and completeness of the
statements made or included therein and takes no responsibility therefor,
except insofar as such statements relate to the opinions set forth above or
relate to such counsel. Such counsel shall state that, in the course of
the preparation of the Registration Statement and the Prospectuses, he has
participated in conferences with certain officers of the Company, and that
his examination of the Registration Statement and the Prospectuses and
discussions in the above-mentioned conferences did not disclose to him any
information which gave him reason to believe that the Registration
Statement (except for the financial statements and other financial data
contained or incorporated therein, as to which no opinion need be
expressed), at the time it became effective, contained an untrue statement
of a material fact or omitted to state a material fact required to be
stated therein or necessary to make the
<PAGE>
27
statements therein not misleading, or that the Prospectuses (except as
aforesaid), on the date hereof and on the Closing Date, included an untrue
statement of a material fact or omitted to state a material fact necessary
in order to make the statements therein, in light of the circumstances
under which they were made, not misleading.
(i) On the Closing Date, there shall have been furnished to you the
opinion of counsel for each of the Selling Stockholders (addressed to the U.S.
Underwriters), dated the Closing Date in form and substance satisfactory to the
U.S. Underwriters to the effect that:
(i) Each Selling Stockholder has full right, power and authority to
enter into this Agreement and the International Underwriting Agreement and
to perform its obligations hereunder and thereunder.
(ii) This Agreement and the International Underwriting Agreement have
each been duly authorized, executed and delivered by or on behalf of each
Selling Stockholder.
(iii) The execution, delivery and performance of this Agreement and
the International Underwriting Agreement by each Selling Stockholder and
the consummation by each Selling Stockholder of the transactions
contemplated hereby and thereby will not conflict with or result in a
breach or violation in any material respect of any of the terms or
provisions of, or constitute a default under, any material indenture,
mortgage, deed of trust, loan agreement or other agreement or instrument
known to such counsel to which each Selling Stockholder is a party or by
which each Selling Stockholder is bound or to which any of the property or
assets of each Selling Stockholder is subject, nor will such actions result
in any violation in any material respect of the provisions of the
partnership agreement of each Selling Stockholder or any statute or any
order, rule or regulation known to such counsel of any court or
governmental agency having jurisdiction over each Selling Stockholder or
the property or assets of each Selling Stockholder; and no consent,
approval, authorization or order of, or filing or registration with, any
such court or governmental agency is required for the execution, delivery
and performance of this Agreement and the International
<PAGE>
28
Underwriting Agreement by each Selling Stockholder and the consummation by
each Selling Stockholder of the transactions contemplated hereby and
thereby, except the registration under the Securities Act of the Shares,
such consents, approvals, authorizations, registrations, filings or
qualifications as may be required under state securities or Blue Sky laws
in connection with the purchase and distribution of the shares by the U.S.
Underwriters or as may be required by the laws of any country other than
the United States, and amendments to filings made under the Exchange Act.
(j) On or prior to the Closing Date, you shall have received from
Cravath, Swaine & Moore, counsel for the U.S. Underwriters, such opinion or
opinions and letter or letters with respect to corporate proceedings by the
Company, the form of the Registration Statement and the U.S. Prospectus (other
than financial statements and other financial data), the validity of the Shares
and other related matters as you may reasonably request, and such counsel shall
have received such documents and information as they request to enable them to
pass upon such matters.
(k) Each Selling Stockholder shall have furnished to the
Representative on the Closing Date a certificate, dated the Closing Date, signed
by, or on behalf of, each Selling Stockholder stating that the representations,
warranties and agreements of the Selling Stockholder contained herein are true
and correct in all material respects as of the Closing Date and that the Selling
Stockholder has complied in all material respects with all agreements contained
herein to be performed by the Selling Stockholder at or prior to the Closing
Date.
Each of Willkie Farr & Gallagher, Michael B. Targoff, Esq., and
Cravath, Swaine & Moore, in rendering their respective opinion or opinions, may
rely as to matters of fact, to the extent they deem proper and specify in such
opinion or opinions, on certificates of responsible officers of the Company and
its subsidiaries and public officials. Each of Willkie Farr & Gallagher,
Michael B. Targoff, Esq., and Cravath, Swaine & Moore may limit their opinions
to matters relating to United States federal laws and the laws of the State of
New York.
All such opinions, certificates, letters and documents shall be in
compliance with the provisions hereof
<PAGE>
29
only if they are reasonably satisfactory in form and substance to you and to
counsel for the U.S. Underwriters. The Company shall furnish to you conformed
copies of such opinions, certificates, letters and other documents in such
number as you shall reasonably request. If any of the conditions specified in
this Section 8 shall not have been fulfilled when and as required by this
Agreement, this Agreement and all obligations of the U.S. Underwriters hereunder
may be cancelled at, or at any time prior to, each Closing Date, by you. Any
such cancellation shall be without liability of the U.S. Underwriters to the
Company. Notice of such cancellation shall be given the Company in writing, or
by telecopy or telephone and confirmed in writing.
9. Indemnification and Contribution. (a) The Company shall
---------------------------------
indemnify and hold harmless each U.S. Underwriter against any loss, claim,
damage or liability (or any action in respect thereof), joint or several, to
which such U.S. Underwriter may become subject, under the Securities Act or
otherwise, insofar as such loss, claim, damage or liability (or action in
respect thereof) arises out of or is based upon (i) any untrue statement or
alleged untrue statement of a material fact contained in the Registration
Statement, any Preliminary Prospectus, any Prospectus or the Registration
Statement or any Prospectus as amended or supplemented or in any blue sky
application or other document executed by the Company specifically for that
purpose or based upon written information furnished by the Company filed in any
state or other jurisdiction in order to qualify any of or all the Shares under
the securities laws thereof (any such application, document or information being
hereinafter referred to as a "Blue Sky Application"), (ii) the omission or
alleged omission to state in the Registration Statement, any Preliminary
Prospectus, any Prospectus or the Registration Statement or any Prospectus as
amended or supplemented or in any Blue Sky Application a material fact required
to be stated therein or necessary to make the statements therein not misleading,
and shall reimburse each U.S. Underwriter promptly after receipt of invoices
from such U.S. Underwriter for any legal or other expenses as reasonably
incurred by such U.S. Underwriter in connection with investigating, preparing to
defend or defending against or appearing as a third-party witness in connection
with any such loss, claim, damage, liability or action, notwithstanding the
possibility that payments for such expenses might later be held to be improper,
in which case such payments shall be promptly refunded; provided,
--------
<PAGE>
30
however, that the Company shall not be liable under this Section 9(a) in any
- -------
such case to the extent that any such loss, claim, damage, liability or action
arises out of or is based upon (x) an untrue statement or alleged untrue
statement or omission or alleged omission made in reliance upon and in
conformity with written information furnished to the Company through the
Representative by or on behalf of any U.S. Underwriter specifically for use in
the preparation of the Registration Statement, any Preliminary Prospectus, any
Prospectus or the Registration Statement or any Prospectus as amended or
supplemented, or any Blue Sky Application, or (y) the sole fact that the U.S.
Underwriter failed to send or give a copy of the Prospectus, as the same may be
amended or supplemented (but excluding documents incorporated by reference), to
a person purchasing securities, within the time required by applicable law, if
the delivery of the Prospectus (as so amended or supplemented) would have cured
the defect giving rise to the claim, unless the Company failed to comply with
its obligations under Section 6(b) of this Agreement.
(b) Each Selling Stockholder agrees, severally but not jointly, to
indemnify and hold harmless each U.S. Underwriter to the same extent as the
foregoing indemnity from the Company to each U.S. Underwriter, but only with
reference to written information related to such Selling Stockholder furnished
to the Company by or on behalf of the Selling Stockholders specifically for
inclusion in the documents referred to in the foregoing indemnity.
(c) Each U.S. Underwriter severally, but not jointly, shall
indemnify and hold harmless the Company and the Selling Stockholders against any
loss, claim, damage or liability (or any action in respect thereof) to which the
Company or any Selling Stockholder may become subject, under the Securities Act
or otherwise, insofar as such loss, claim, damage or liability (or action in
respect thereof) arises out of or is based upon (i) any untrue statement or
alleged untrue statement of a material fact contained in the Registration
Statement, any Preliminary Prospectus, any Prospectus or the Registration
Statement or any Prospectus as amended or supplemented, or in any Blue Sky
Application, (ii) the omission or alleged omission to state in the Registration
Statement, any Preliminary Prospectus, any Prospectus or the Registration
Statement or any Prospectus as amended or supplemented, or in any Blue Sky
Application, a material fact required to be stated therein or necessary to make
the statements therein not misleading, and shall
<PAGE>
31
reimburse the Company and the Selling Stockholders promptly after receipt of
invoices from the Company or any Selling Stockholder for any legal or other
expenses as reasonably incurred by the Company or any Selling Stockholder in
connection with investigating, preparing to defend or defending against or
appearing as a third-party witness in connection with any such loss, claim,
damage, liability or action notwithstanding the possibility that payments for
such expenses might later be held to be improper, in which case such payments
shall be promptly refunded; provided, however, that such indemnification or
-------- -------
reimbursement shall be available in each such case to the extent, but only to
the extent, that such untrue statement or alleged untrue statement or omission
or alleged omission was made in reliance upon and in conformity with written
information furnished to the Company through you by or on behalf of such U.S.
Underwriter specifically for use in the preparation thereof.
(d) Promptly after receipt by any indemnified party under subsection
(a), (b) or (c) above of notice of any claim or the commencement of any action,
the indemnified party shall, if a claim in respect thereof is to be made against
the indemnifying party under such subsection, notify the indemnifying party in
writing of the claim or the commencement of that action; provided, however, that
-------- -------
the failure so to notify the indemnifying party shall not relieve it from any
liability which it may have under this Section 9 except to the extent it has
been prejudiced in any material respect by such failure or from any liability
which it may have to an indemnified party otherwise than under this Section 9.
If any such claim or action shall be brought against any indemnified party and
it shall notify the indemnifying party thereof, the indemnifying party shall be
entitled to participate therein and, to the extent that it wishes, jointly with
any other similarly notified indemnified party, to assume the defense thereof
with counsel reasonably satisfactory to the indemnified party. After notice
from the indemnifying party to the indemnified party of its election to assume
the defense of such claim or action, the indemnifying party shall not be liable
to the indemnified party under such subsection for any legal or other expenses
subsequently incurred by the indemnified party in connection with the defense
thereof other than reasonable costs of investigation; except that the
indemnified party shall have the right to employ separate counsel (including
local counsel), and the indemnifying party shall bear the reasonable fees, costs
and expenses of
<PAGE>
32
such separate counsel, if the use of counsel chosen by the indemnifying party to
represent the indemnified party would in the indemnified party's reasonable
judgment present such counsel with a conflict of interest or the indemnified
party reasonably determines that there may be legal defenses available to it
which are different from or in addition to those available to the indemnifying
party. It is understood that the indemnifying party shall not, in connection
with any proceeding or related proceedings in the same jurisdiction, be liable
for the reasonable fees and expenses of more than one separate firm (in addition
to any local counsel) for all such indemnified parties. The indemnifying party
shall not be liable for any settlement of any proceeding effected without its
written consent, but if settled with such consent or if there be a final
judgment for the plaintiff, the indemnifying party agrees to indemnify the
indemnified party from and against any loss or liability by reason of such
settlement or judgment. The indemnifying party shall not, without the prior
consent of the indemnified party, which consent will not be unreasonably
withheld, enter into any settlement of a lawsuit, claim or other proceeding
unless such settlement includes an explicit and unconditional release from the
party bringing such lawsuit, claim or other proceeding of the indemnified party.
(e) If the indemnification provided for in this Section 9 is
unavailable to hold harmless an indemnified party under subsection (a), (b) or
(c) above, then each indemnifying party shall, in lieu of indemnifying such
indemnified party, contribute to the amount paid or payable by such indemnified
party as a result of the losses, claims, damages or liabilities referred to in
subsection (a), (b) or (c) above (i) in such proportion as is appropriate to
reflect the relative benefits received by the Company and the Selling
Stockholders, on the one hand, and the U.S. Underwriters, on the other hand,
from the offering of the Shares or (ii) if the allocation provided by clause (i)
above is not permitted by applicable law, in such proportion as is appropriate
to reflect not only the relative benefits referred to in clause (i) above but
also the relative fault of the Company and the Selling Stockholders, on the one
hand, and the U.S. Underwriters, on the other hand, in connection with the
statements or omissions that resulted in such losses, claims, damages or
liabilities, or actions in respect thereof, as well as any other relevant
equitable considerations. The relative benefits received by the Company and the
Selling Stockholders, on the one hand, and
<PAGE>
33
the U.S. Underwriters, on the other hand, shall be deemed to be in the same
proportion as the total proceeds from the offering of the Shares (net of
underwriting discounts and commissions but before deducting expenses) received
by the Company and the Selling Stockholders, on the one hand, bear to the total
underwriting discounts and commissions received by the U.S. Underwriters, on the
other hand, in each case as set forth in the table on the cover page of the U.S.
Prospectus (with the estimated expenses allocated pro rata among the Shares and
the International Shares). Relative fault shall be determined by reference to,
among other things, whether the untrue or alleged untrue statement of a material
fact or the omission or alleged omission to state a material fact relates to
information supplied by the Company, the Selling Stockholders or the U.S.
Underwriters and the parties' relative intent, knowledge, access to information
and opportunity to correct or prevent such untrue statement or omission. The
Company, the Selling Stockholders and the U.S. Underwriters agree that it would
not be just and equitable if contributions pursuant to this subsection (e) were
to be determined by pro rata allocation (even if the U.S. Underwriters were
treated as one entity for such purpose) or by any other method of allocation
which does not take into account the equitable considerations referred to in the
first sentence of this subsection (e). The amount paid by an indemnified party
as a result of the losses, claims, damages or liabilities (or actions in respect
thereof) referred to in the first sentence of this subsection (e) shall be
deemed to include any legal or other expenses reasonably incurred by such
indemnified party in connection with investigating, preparing to defend or
defending against any action or claim which is the subject of this subsection
(e). Notwithstanding the provisions of this subsection (e), (i) no U.S.
Underwriter shall be required to contribute any amount in excess of the amount
by which the total price at which the Shares underwritten by it and distributed
to the public were offered to the public exceeds the amount of any damages which
such U.S. Underwriter has otherwise been required to pay by reason of such
untrue or alleged untrue statement or omission or alleged omission, and (ii) no
Selling Stockholder shall be required to contribute any amount in excess of the
amount by which the total price at which the Shares of such Selling Stockholder
were offered to the public (less underwriting discounts and commissions) exceeds
the amount of damages which such Selling Stockholder has otherwise been required
to pay by reason of such untrue statement or alleged untrue statement or
omission or alleged omission. No person guilty
<PAGE>
34
of fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. The U.S. Underwriters' obligations
in this subsection (e) to contribute are several in proportion to their
respective underwriting obligations and not joint. Each party entitled to
contribution agrees that upon the service of a summons or other initial legal
process upon it in any action instituted against it in respect of which
contribution may be sought, it shall promptly give written notice of such
service to the party or parties from whom contribution may be sought, but the
omission so to notify such party or parties of any such service shall not
relieve the party from whom contribution may be sought for any obligation it may
have hereunder or otherwise (except as specifically provided in subsection (d)
hereof). Each Selling Stockholder's obligation to contribute pursuant to this
Section 9(e) is several, based on the proportion that the proceeds of the
offering received by such Selling Stockholder bears to the total proceeds of the
offering received by all Selling Stockholders, and not joint.
(f) The obligations of the Company under this Section 9 shall be in
addition to any liability which the Company may otherwise have, and shall
extend, upon the same terms and conditions, to each person, if any, who controls
any U.S. Underwriter within the meaning of the Securities Act or the Exchange
Act or the Rules and Regulations thereunder; the obligations of the Selling
Stockholders under this Section 9 shall be in addition to any liability which
the Selling Stockholders may otherwise have, and shall extend, upon the same
terms and conditions to each person who controls any U.S. Underwriter within the
meaning of the Securities Act or the Exchange Act or the Rules and Regulations
thereunder; and the obligations of the U.S. Underwriters under this Section 9
shall be in addition to any liability that the respective U.S. Underwriters may
otherwise have, and shall extend, upon the same terms and conditions, to each
director of the Company (including any person who, with his or her consent, is
named in the Registration Statement as about to become a director of the
Company) or general partner of any Selling Stockholder, to each officer of the
Company who has signed the Registration Statement and to each person, if any,
who controls the Company or any Selling Stockholder within the meaning of the
Securities Act or the Exchange Act or the Rules and Regulations thereunder.
<PAGE>
35
(g) The Company and the Selling Stockholders understand and agree
that, as among themselves, (i) the indemnification, contribution and related
agreements entered into by such parties are as set forth in the Standstill
Agreement and shall remain in full force and effect, (ii) no provision of this
Agreement affects or alters in any way the indemnification, contribution or
other obligations (whether or not related to indemnification or contribution
matters) of such parties under the Standstill Agreement and (iii) in the event
of any inconsistency between any provision of this Agreement and the Standstill
Agreement, the relevant provision or provisions of the Standstill Agreement
shall control.
10. Effective Date and Termination. (a) This Agreement shall become
-------------------------------
effective at 11:00 A.M., New York City time, on the first full Business Day
following the date hereof, or at such earlier time after the Registration
Statement becomes effective as you shall first release the Shares for sale to
the public. You shall notify the Company immediately after you have taken any
action which causes this Agreement to become effective. Until this Agreement is
effective, it may be terminated by the Company or the Selling Stockholders by
giving notice as hereinafter provided to you, or by you by giving notice as
hereinafter provided to the Company and the Selling Stockholders, except that
the provisions of Section 6(g) and Section 9 shall at all times be effective.
For purposes of this Agreement, the release of the offering of the Shares for
sale to the public shall be deemed to have been made when you release, by
telecopy or otherwise, firm offers of the Shares to securities dealers or
release for publication a newspaper advertisement relating to the Shares,
whichever occurs first.
(b) Until the Closing Date, this Agreement may be terminated by you
in your absolute discretion by giving notice as hereinafter provided to the
Company and the Selling Stockholders if (i) the Company shall have failed,
refused or been unable, at or prior to the Closing Date, to perform in all
material respects any agreement on its part to be performed hereunder, (ii) any
other condition of the U.S. Underwriters' obligations hereunder is not
fulfilled, (iii) trading in the Common Stock of the Company is suspended by the
Commission or the New York Stock Exchange or trading in securities generally on
the New York Stock Exchange shall have been suspended or limited or minimum
prices shall have been established on such exchange by the
<PAGE>
36
Commission or such exchange or other regulatory body or governmental authority
having jurisdiction, (iv) a banking moratorium is declared by either Federal or
New York State authorities or (v) the United States becomes engaged in
hostilities or there is an escalation of hostilities involving the United States
or there is a declaration of a national emergency or war by the United States,
or (vi) there shall have been such a material adverse change in general
economic, political or financial conditions, or the effect of international
conditions on the financial markets in the United States shall be such, as to,
in your judgment, make it inadvisable or impracticable to proceed with the
delivery of the Shares. Any termination of this Agreement pursuant to this
Section 10 shall be without liability on the part of the Company, the Selling
Stockholders or any U.S. Underwriter, except as otherwise provided in Sections
6(g) and 9 hereof.
Any notice referred to above may be given at the address specified in
Section 12 hereof in writing or by telecopy or telephone, and if by telecopy or
telephone, shall be immediately confirmed in writing.
11. Survival of Certain Provisions. The agreements contained in
-------------------------------
Section 9 hereof and the representations, warranties and agreements of the
Company contained in Sections 2 and 6 hereof and the Selling Stockholders
contained in Sections 3 and 7 hereof shall survive the delivery of the Shares to
the U.S. Underwriters hereunder and shall remain in full force and effect,
regardless of any termination or cancellation of this Agreement or any
investigation made by or on behalf of any indemnified party.
12. Notices. Except as otherwise provided in the Agreement, (a)
--------
whenever notice is required by the provisions of this Agreement to be given to
the Company, such notice shall be in writing or by telecopy addressed to the
Company at 600 Third Avenue, New York, New York 10016, Attention: Michael B.
Targoff, Esq., Senior Vice President and Secretary; (b) whenever notice is
required by the provisions of this Agreement to be given to the Selling
Stockholders, such notice shall be in writing or by telecopy addressed to the
Selling Stockholders c/o Lehman Brothers Holdings Inc., 3 World Financial
Center, 200 Vesey Street, New York, New York 10205, Attention: Alan H.
Washkowitz and Julie T. Katzman; and (c) whenever notice is required by the
provisions of this Agreement to be given to the several U.S.
<PAGE>
37
Underwriters, such notice shall be in writing or by telecopy addressed to you,
in care of Lehman Brothers Inc., 3 World Financial Center, New York, New York
10285, Attention: Syndicate Department.
13. Information Furnished by U.S. Underwriters. The Company and the
-------------------------------------------
U.S. Underwriters severally confirm that the statements set forth in the last
paragraph of the cover page with respect to the public offering of the Shares
and under the caption "Underwriting" (except the last paragraph thereof) in any
Preliminary Prospectus and in the Prospectuses are correct and constitute the
written information furnished by or on behalf of any U.S. Underwriter referred
to in paragraph (b) of Section 2 hereof and in paragraphs (a), (b) and (c) of
Section 9 hereof.
14. Parties. This Agreement shall inure to the benefit of and be
--------
binding upon the several U.S. Underwriters, the Company, the Selling
Stockholders and their respective successors. This Agreement and the terms and
provisions hereof are for the sole benefit of only those persons, except that
(a) the representations, warranties, indemnities and agreements of the Company
and the Selling Stockholders contained in this Agreement shall also be deemed to
be for the benefit of the person or persons, if any, who control within the
meaning of the Securities Act or the Exchange Act or the Rules and Regulations
thereunder any U.S. Underwriter who offers or sells any Shares in accordance
with the terms of the Agreement Between U.S. Underwriters and International
Managers and for the benefit of any International Manager (and controlling
persons thereof) who offers or sells any Shares in accordance with the terms of
the Agreement Between U.S. Underwriters and International Managers and (b) the
indemnity agreement of the U.S. Underwriters contained in Section 9 hereof shall
be deemed to be for the benefit of directors of (i) the Company, officers of the
Company who signed the Registration Statement and any person controlling the
Company within the meaning of the Securities Act or the Exchange Act or the
Rules and Regulations thereunder and (ii) the Selling Stockholders, each partner
thereof and any person controlling any Selling Stockholder within the meaning of
the Securities Act or the Exchange Act or the Rules and Regulations thereunder.
Nothing in this Agreement shall be construed to give any person, other than the
persons referred to in this paragraph, any legal or equitable right, remedy or
claim under or in respect of this Agreement or any provision contained herein.
The term "successors", as used
<PAGE>
38
in this Agreement, shall not include any purchaser of any of the Shares from any
of the U.S. Underwriters merely by reason of such purchase.
15. Governing Law. This Agreement shall be governed by and construed
--------------
in accordance with the laws of the State of New York.
16. Counterparts. This Agreement may be signed in one or more
-------------
counterparts, each of which shall constitute an original and all of which
together shall constitute one and the same agreement.
<PAGE>
39
Please confirm, by signing and returning to us two counterparts of
this Agreement, that you are acting on behalf of yourselves and the several U.S.
Underwriters and that the foregoing correctly sets forth the Agreement among the
Company, the Selling Stockholders and the several U.S. Underwriters.
Very truly yours,
LORAL CORPORATION,
By:_________________________
Name:
Title:
LEHMAN BROTHERS MERCHANT
BANKING PORTFOLIO PARTNERSHIP
L.P., as Selling Stockholder
By: Lehman Brothers Merchant
Banking Partners, Inc.
By:_________________________
Name:
Title:
LEHMAN BROTHERS CAPITAL
PARTNERS II, L.P., as
Selling Stockholder
By: Lehman Brothers II
Investment Inc.
By:_________________________
Name:
Title:
<PAGE>
40
LEHMAN BROTHERS OFFSHORE
INVESTMENT PARTNERSHIP L.P.,
as Selling Stockholder
By: Lehman Brothers Offshore
Partners Ltd.
LEHMAN BROTHERS OFFSHORE
INVESTMENT PARTNERSHIP - JAPAN
L.P., as Selling Stockholder
By: Lehman Brothers Offshore
Partners Ltd.
By:_________________________
Name:
Title:
Confirmed and accepted as of
the date first above mentioned:
LEHMAN BROTHERS INC.
By:_____________________________
Authorized Representative
<PAGE>
SCHEDULE I
Underwriting Agreement dated June , 1995
Number of
Shares to Be
Selling Stockholder Sold
- ------------------- ------------
Lehman Brothers Merchant Banking
Portfolio Partnership L.P. ..........
Lehman Brothers Capital Partners II,
L.P. ................................
Lehman Brothers Offshore Investment
Partnership L.P. ....................
Lehman Brothers Offshore Investment
Partnership - Japan L.P. ............ ---------------
Total................................. 2,654,960
=============
<PAGE>
SCHEDULE II
Underwriting Agreement dated June , 1995
Number of
Shares to Be
U.S. Underwriter Purchased
- ---------------- ------------
Lehman Brothers Inc...
---------
Total................. 2,654,960
=========
<PAGE>
EXHIBIT 1.2
[Draft--5/30/95]
660,000 Shares
LORAL CORPORATION
Common Stock
International Underwriting Agreement
------------------------------------
June , 1995
LEHMAN BROTHERS INTERNATIONAL (EUROPE)
One Broadgate
London EC2M 7HA
England
Dear Sirs:
Each of the entities named in Schedule I hereto (the "Selling
Stockholders") proposes to sell to the several International Managers named in
Schedule II hereto (the "International Managers") the number of shares of Common
Stock, $.25 par value (the "Common Stock"), of Loral Corporation, a New York
corporation (the "Company"), set forth opposite its name in Schedule I,
representing an aggregate of 660,000 shares (the "Shares"). If the firms listed
in Schedule II hereto include only you, then the terms "International Managers"
and "Lead Manager", as used herein, shall each be deemed to refer to such firm.
It is understood that the Company and the Selling Stockholders are
concurrently entering into a U.S. Underwriting Agreement dated the date hereof
(the "U.S. Underwriting Agreement"), providing for the sale by the Selling
Stockholders of 2,654,960 shares of Common Stock through arrangements with
certain underwriters in the United States (the "U.S. Underwriters"). If the
firms listed in Schedule II to the U.S. Underwriting Agreement include only the
Representatives, then the terms "U.S. Underwriters" and "Representatives", as
used herein, shall each be deemed to refer to such firms. All shares of Common
Stock to be offered by the U.S. Underwriters pursuant to the U.S. Underwriting
Agreement are herein called the "U.S. Shares"; the U.S. Shares and the Shares,
collectively, are herein called the "Shares". As specified in Section 4, the
respective closings under this Agreement and the U.S. Underwriting Agreement are
hereby expressly made conditional on one another.
<PAGE>
2
The Company and the Selling Stockholders also understand that the U.S.
Underwriters and the International Managers have entered into an agreement (the
"Agreement Between U.S. Underwriters and International Managers") contemplating
the coordination of certain transactions between the U.S. Underwriters and the
International Managers and that, pursuant thereto and subject to the conditions
set forth therein, the U.S. Underwriters may purchase from the International
Managers a portion of the Shares or sell to the International Managers a portion
of the U.S. Shares. The Company and the Selling Stockholders understand that
any such purchases and sales between the U.S. Underwriters and the International
Managers shall be governed by the Agreement Between U.S. Underwriters and
International Managers and shall not be governed by the terms of this Agreement
or the U.S. Underwriting Agreement.
This is to confirm the agreement concerning the purchase of the Shares
from the Selling Stockholders by the International Managers.
The following terms as used in this Agreement shall have the following
meanings:
"Business Day" shall mean any day on which the New York Stock Exchange
------------
is open for trading.
"Effective Date" shall mean the date of the Effective Time.
--------------
"Effective Time" shall mean the date and the time as of which the
--------------
Registration Statement, or the most recent post-effective amendment thereto, if
any, was declared effective by the Commission (or, if the Company will next file
with the Commission an amendment to the Registration Statement as contemplated
by clause (i) of the first paragraph of Section 1, the date and time as of which
the Registration Statement shall be declared effective).
"Exchange Act" shall mean the Securities Exchange Act of 1934.
------------
"Execution Time" shall mean the date and time that this Agreement is
--------------
executed and delivered by the parties hereto.
<PAGE>
3
"International Prospectus" shall mean a Prospectus relating to the
------------------------
Shares which are to be offered and sold outside the United States to persons
other than U.S. Persons.
"Preliminary Prospectuses" shall mean each prospectus included in the
------------------------
Registration Statement, or any amendment thereof, before the Effective Date,
each prospectus filed with the Commission by the Company with the consent of the
International Managers pursuant to Rule 424(a) and each prospectus included in
the Registration Statement at the Effective Time that omits Rule 430A
Information.
"Prospectuses" shall mean the forms of prospectuses relating to the
------------
Shares, as first filed pursuant to Rule 424(b) after the Execution Time or, if
no filing pursuant to Rule 424(b) is required, the forms of final prospectuses
included in the Registration Statement at the Effective Time.
"Registration Statement" shall mean the registration statement
----------------------
referred to above, as amended at the Effective Time, including any documents
incorporated by reference and any Rule 430A Information deemed to be included
therein at the Effective Time as provided by Rule 430A.
"Rule 424" and "Rule 430A" shall refer to such rules under the
-------- ---------
Securities Act.
"Rule 430A Information" shall mean information with respect to the
---------------------
Shares and the offering thereof permitted to be omitted from the Registration
Statement when it becomes effective pursuant to Rule 430A.
"Rules and Regulations" shall mean the rules and regulations in effect
---------------------
at any relevant time adopted by the Commission under the Securities Act or the
Exchange Act.
"Subsidiary" and "Significant Subsidiary" shall have the meanings
---------- ----------------------
assigned in Rule 405 of the Rules and Regulations. As used in reference to the
Company, "subsidiary" shall mean a Subsidiary of the Company.
----------
"U.S. Person" shall mean any resident or national of the United
-----------
States, any corporation, partnership or other entity created or organized in or
under the laws of the United States or any estate or trust the income of which
is subject to United States income taxation regardless of the source of its
income (other than the foreign branch of any
<PAGE>
4
U.S. Person), and includes any United States branch of a person other than a
U.S. Person; and "United States" shall mean the United States of America
-------------
(including the states thereof and the District of Columbia) and its territories,
its possessions and other areas subject to its jurisdiction.
"U.S. Prospectus" shall mean a Prospectus relating to the U.S. Shares
---------------
which are to be offered and sold in the United States or to U.S. Persons.
Reference made herein to any Preliminary Prospectus or to the Prospectuses shall
be deemed to refer to and include any documents incorporated by reference
therein pursuant to Item 12 of Form S-3 under the Securities Act, as of the date
of such Preliminary Prospectus or the Prospectuses and any reference to any
amendment or supplement to any Preliminary Prospectus or the Prospectuses shall
be deemed to refer to and include any document filed under the Exchange Act
after the date of such Preliminary Prospectus or the Prospectuses and
incorporated by reference in such Preliminary Prospectus or the Prospectuses.
1. Registration Statement. A registration statement on Form S-3
-----------------------
(File No. 33- ) with respect to the Shares has been prepared by the Company in
conformity with the requirements of the Securities Act of 1933 (the "Securities
Act") and the Rules and Regulations of the Securities and Exchange Commission
(the "Commission") thereunder and has been filed with the Commission under the
Securities Act. Copies of such registration statement as amended to date have
been delivered by the Company to you as the Lead Manager of the International
Managers. The Company will next file with the Commission one of the following:
(i) prior to effectiveness of such registration statement, a further amendment
to such registration statement, including forms of final prospectuses, or (ii)
after effectiveness of such registration statement, final prospectuses in
accordance with Rules 430A and 424(b)(1) or (4).
2. Representations, Warranties and Agreements of the Company. The
----------------------------------------------------------
Company represents, warrants and agrees that:
(a) On the Effective Date, the Registration Statement did or will,
and when the Prospectuses are first filed (if required) in accordance with Rule
424(b) and on the Closing Date (as defined in Section 5) the Prospectuses (and
any supplements thereto) will, comply in all material
<PAGE>
5
respects with the applicable requirements of the Securities Act and the Rules
and Regulations. The Company has included in the Registration Statement, as
amended at the Effective Date, all information required by the Securities Act
and the Rules and Regulations thereunder to be included in the Prospectuses with
respect to the Shares and the offering thereof, and the Prospectuses, when filed
with the Commission, did or will contain all Rule 430A Information, together
with all other such required information, with respect to the Shares and the
offering thereof and, except to the extent the Lead Manager shall agree in
writing to a modification, shall be in all substantive respects in the form
furnished to you prior to the Execution Time or, to the extent not completed at
the Execution Time, shall contain only such specific additional information and
other changes (beyond that contained in the latest Preliminary Prospectuses) as
the Company has advised you, prior to the Execution Time, will be included or
made therein. The Commission has not issued any stop order preventing or
suspending the use of any Preliminary Prospectus or the Prospectuses or the
effectiveness of the Registration Statement, and no proceeding for any such
purpose has been initiated or threatened by the Commission.
(b) On the Effective Date, the Registration Statement did not or
will not contain any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary in order to make the
statements therein not misleading; and, on the Effective Date, the Prospectuses
did not or will not, and on the date of any filing pursuant to Rule 424(b) and
on the Closing Date, the Prospectuses (together with any supplement thereto)
will not, include any untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading; provided that the
Company makes no representation or warranty as to information contained in or
omitted from the Registration Statement or the Prospectuses in reliance upon,
and in conformity with, written information furnished to the Company by you, or
by any International Manager through you, specifically for inclusion therein.
(c) The documents incorporated by reference in the Prospectuses, when
they were filed with the Commission (or upon amendment thereof by other
documents included in such incorporated documents), conformed in all material
respects to the requirements of the Securities Act or
<PAGE>
6
Exchange Act, as applicable, and the Rules and Regulations thereunder, and such
documents were timely filed as required thereby and none of such documents
contained an untrue statement of a material fact or omitted to state a material
fact required to be stated therein or necessary to make the statements therein,
in light of the circumstances under which they were made, not misleading; and
any further documents so filed and incorporated by reference in the
Prospectuses, when such documents become effective or are filed with Commission
will conform in all material respects to the requirements of the Securities Act
or the Exchange Act, as applicable, and the Rules and Regulations thereunder,
and will be timely filed as required thereby and will not contain an untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein not misleading.
(d) The accountants who certified the consolidated financial
statements and supporting schedules included in or incorporated by reference in
the Registration Statement, any Preliminary Prospectus or the Prospectuses are
independent public accountants as required by the Securities Act and the Rules
and Regulations thereunder.
(e) The consolidated financial statements and schedules (including
the related notes and supporting schedules) included in the Registration
Statement, any Preliminary Prospectus or the Prospectuses present (or in the
case of any amendment or supplement to any such document, or any material
incorporated by reference in any such document, filed with the Commission after
the date as of which this representation is made, will present) fairly and in
accordance with generally accepted accounting principles applied on a consistent
basis throughout the periods involved, the financial condition, results of
operations and changes in financial condition of the entities purported to be
shown thereby at the dates and for the periods indicated and have been or will
be, as the case may be, prepared in accordance with generally accepted
accounting principles applied on a consistent basis throughout the periods
indicated.
(f) The pro forma condensed consolidated financial statements
incorporated by reference into the Registration Statement, any Preliminary
Prospectuses or the Prospectuses have been prepared in accordance with Article
11 of Regulation S-X of the Rules and Regulations. The Company has no reason to
believe that the assumptions upon which
<PAGE>
7
such pro forma financial statements are based are inaccurate or inappropriate or
that such pro forma financial information was not prepared in conformity with
the notes thereto.
(g) Since the respective dates as of which information is given in
the Registration Statement and the Prospectuses, except as otherwise stated
therein, (A) there has been no material adverse change, in the condition,
financial or otherwise, or in the earnings, assets, affairs or business
prospects of the Company and its subsidiaries, taken as a whole, whether or not
arising in the ordinary course of business, (B) there have been no transactions,
entered into by the Company or any of its subsidiaries, other than those in the
ordinary course of business, which are material with respect to the Company and
its subsidiaries considered as a whole, and (C) there has been no extraordinary
dividend or distribution of any kind declared, paid or made by the Company on
any class of its capital stock.
(h) The Company has been duly incorporated and is validly existing as
a corporation in good standing under the laws of the State of New York, and has
full corporate power and authority to own or hold its properties and to conduct
its business as described in the Registration Statement, and has been duly
qualified as a foreign corporation for the transaction of business and is in
good standing under the laws of each other jurisdiction in which it owns or
leases property, or conducts any business, so as to require such qualification
(except where the failure to so qualify would not have a material adverse effect
on the Company and its subsidiaries considered as a whole, or on the earnings,
assets, affairs or business prospects of the Company and its subsidiaries
considered as a whole).
(i) Each subsidiary of the Company listed in Exhibit 21 of the Annual
Report on Form 10-K of the Company filed with the Commission under Section 13 of
the Exchange Act for the fiscal year ended March 31, 1995 (the "Form 10-K
Report"), has been duly incorporated and is validly existing as a corporation in
good standing under the laws of its jurisdiction of incorporation, has full
corporate power and authority to own, lease and operate its properties and
conduct its business and has been duly qualified as a foreign corporation for
the transaction of business and is in good standing under the laws of each other
jurisdiction in which it owns or leases property, or conducts any business, so
as to require such qualification (except where
<PAGE>
8
the failure to so qualify would not have a material adverse effect on the
condition, financial or otherwise, of the Company and its subsidiaries
considered as a whole, or on earnings, assets, affairs or business prospects of
the Company and its subsidiaries considered as a whole); and all the issued and
outstanding capital stock of each such subsidiary has been duly authorized and
validly issued, is fully paid and nonassessable and is owned by the Company
directly or through Subsidiaries, free and clear of any mortgage, pledge, lien,
encumbrance, claim or equity (except as set forth in the notes to Exhibit 21 of
the Form 10-K Report) and no holder of such stock is subject to personal
liability by reason of being such holder.
(j) Since the end of its most recently completed fiscal year, the
Company has filed all documents and amendments to previously filed documents
required to be filed by it pursuant to Section 13(a), 13(b), 14 or 15(d) of the
Exchange Act.
(k) Neither the Company nor any of its subsidiaries is in violation
of any term or provision of their respective Certificates of Incorporation or
By-laws, in each case as amended, or in default under any agreement, indenture
or instrument, the effect of which violation or default would be material to the
Company and its subsidiaries taken as a whole; and the execution, delivery and
performance of this Agreement and the U.S. Underwriting Agreement have been duly
authorized by all necessary corporate action and will not conflict with or
result in a breach or violation of any of the terms or provisions of, or
constitute a default under, or result in the creation or imposition of any lien,
charge or encumbrance upon any of the assets of the Company or any of its
subsidiaries pursuant to the terms of any agreement, indenture or instrument, or
result in a violation of the provisions of the Certificate of Incorporation or
the By-laws, in each case as amended, of the Company or any of its subsidiaries
(the effect of which conflict, lien, charge, encumbrance, default or violation
would be material to the Company and the subsidiaries taken as a whole, or would
materially and adversely affect the ability of the Company to perform under this
Agreement or the U.S. Underwriting Agreement) nor will the performance by the
Company of its obligations hereunder violate any law, rule, administrative
regulation or decree of any court or governmental agency having jurisdiction
over the Company, any of its subsidiaries or their respective properties; and no
consent, approval, authorization, order, registration, filing or
<PAGE>
9
qualification of or with any court or governmental agency or body is required
for the sale of the Shares or the consummation of the other transactions
contemplated by this Agreement or the U.S. Underwriting Agreement, except the
registration under the Securities Act of the Shares, and such consents,
approvals, authorizations, registrations, filings or qualifications as may be
required under state securities or Blue Sky laws or as may be required by the
laws of any country other than the United States in connection with the purchase
and distribution of the Shares by the International Managers.
(l) There is no action, suit or proceeding before or by any court or
governmental agency or body, domestic or foreign, now pending, or to the
knowledge of the Company, threatened against or affecting the Company or any of
its subsidiaries which is required to be disclosed in the Registration Statement
(other than as disclosed therein) or might result in any material adverse change
in the condition, financial or otherwise, or in the earnings, assets, affairs or
business prospects of the Company and its subsidiaries considered as a whole, or
which might materially and adversely affect the properties and assets thereof or
which might materially and adversely affect the consummation of the transactions
contemplated by this Agreement and the U.S. Underwriting Agreement; all pending
legal or governmental proceedings to which the Company or any of its
subsidiaries is a party or of which any of their property is subject which are
not described in the Registration Statement, including ordinary routine
litigation incidental to the business, are, considered in the aggregate, not
material with respect to the Company and its subsidiaries considered as a whole;
and there are no contracts or other documents of the Company or any of its
subsidiaries which are required to be filed as exhibits to the Registration
Statement or to any document incorporated by reference therein which have not
been so filed.
(m) The Company and its subsidiaries own or possess such
certificates, authorizations or permits issued by the appropriate state, federal
or foreign regulatory agencies or bodies, the absence of which would have a
material adverse effect on the business now operated by them, and neither the
Company nor any of its subsidiaries has received any notice of proceeding
relating to the revocation or modification of any such certificate, authority or
permit which, singly or in the aggregate, if the subject of an unfavorable
decision, ruling, or finding would
<PAGE>
10
materially and adversely affect the conduct of business, operations, financial
condition or income of the Company and its subsidiaries considered as a whole.
(n) There are no holders of securities of the Company who, by reason
of the filing of the Registration Statement or the Preliminary Prospectuses or
the Prospectuses under the Securities Act, have the right to request the Company
to register under the Securities Act securities held by them, other than rights
which have been waived or satisfied.
(o) All outstanding shares of Common Stock, including the Shares,
have been duly and validly authorized and are validly issued, fully paid and
nonassessable. There are no preemptive rights to subscribe for or to purchase,
or any restriction upon the voting or transfer of, any Shares pursuant to the
Company's corporate charter, By-laws or any agreement or other instrument to
which the Company or any of its subsidiaries is a party or by which it may be
bound; the Common Stock, including the Shares, are listed on the New York Stock
Exchange. The capitalization of the Company as of March 31, 1995, is as set
forth in the Registration Statement.
(p) This Agreement has been duly authorized, executed and delivered
by the Company.
(q) Neither the Company nor any subsidiary has taken and neither
shall take, directly or indirectly, any action designed to cause or result in,
or which has constituted or which might reasonably be expected to constitute,
the stabilization or manipulation of the price of the shares of Common Stock to
facilitate the sale or resale of the Shares.
(r) The conditions for the use of Form S-3, as set forth in the
General Instructions thereto in connection with the offering of the Shares, have
been satisfied.
3. Representations, Warranties and Agreements of the Selling
--------------------------------------------- -----------
Stockholders. Each Selling Stockholder represents, warrants and agrees that:
- -------------
(a) The Selling Stockholder has, and immediately prior to the Closing
Date (as defined in Section 5 hereof) the Selling Stockholder will have, good
and marketable title to the Shares to be sold by the Selling Stockholder here-
<PAGE>
11
under and under the U.S. Underwriting Agreement on such date, free and clear of
all liens, encumbrances, equities or claims; and upon delivery of such Shares
and payment therefor pursuant hereto and thereto, good and marketable title to
such shares, free and clear of all liens, encumbrances, equities or claims
(except such as may be created by the International Managers or U.S.
Underwriters), will pass to the several International Managers and the U.S.
Underwriters.
(b) The Selling Stockholder has full right, power and authority to
enter into and perform under this Agreement and the U.S. Underwriting Agreement;
the execution, delivery and performance of this Agreement and the U.S.
Underwriting Agreement by the Selling Stockholder and the consummation by the
Selling Stockholder of the transactions contemplated herein and therein will not
conflict with or result in a breach or violation of any of the terms or
provisions of, or constitute a default under, any charter, partnership
agreement, by-laws, standstill agreement, indenture, mortgage, deed of trust,
loan agreement or other agreement or instrument to which the Selling Stockholder
is a party or by which the Selling Stockholder is bound or to which any of the
property or assets of the Selling Stockholder is subject, nor will such actions,
to the knowledge of the Selling Stockholder, result in any violation of the
provisions of any statute or any order, rule or regulation of any court or
governmental agency or body having jurisdiction over the Selling Stockholder or
the property or assets of the Selling Stockholder; and no consent, approval,
authorization, order, filing or registration of or with, any court or
governmental agency or body is required for the execution, delivery and
performance of this Agreement and the U.S. Underwriting Agreement by the Selling
Stockholder and the consummation by the Selling Stockholder of the transactions
contemplated herein and therein, except the registration under the Securities
Act of the Shares, such consents, approvals, authorizations, registrations,
filings or qualifications as may be required under state securities or Blue Sky
laws in connection with the purchase and distribution of the Shares by the
International Managers, and amendments to filings made under the Exchange Act.
(c) All written information related to such Selling Stockholder
furnished to the Company by the Selling Stockholder specifically for use in the
Registration Statement, any Preliminary Prospectuses, the Prospectuses or any
amendment or supplement thereto does not, or at the
<PAGE>
12
Effective Time will not, contain any untrue statement of a material fact or omit
to state any material fact required to be stated therein or necessary to make
the statements therein not misleading.
4. Purchase of the Shares by the U.S. Underwriters. Subject to the
------------------------------------------------
terms and conditions and upon the basis of the representations and warranties
herein set forth, each of the Selling Stockholders agrees, severally and not
jointly, to sell to the International Managers the number of Shares set forth
opposite such Selling Stockholder's name in Schedule I, and each of the
International Managers agrees, severally and not jointly, to purchase, at a
price of $[ ] per Share, the number of Shares set forth opposite such
International Manager's name in Schedule II hereto. Each International Manager
shall be obligated to purchase from each Selling Stockholder that number of the
Shares which represents the same proportion of the number of the Shares to be
sold by the Selling Stockholders as the number of the Shares set forth opposite
the name of such International Manager in Schedule II represents of the total
number of the Shares to be purchased by all the International Managers pursuant
to this Agreement. The respective purchase obligations of the International
Managers with respect to the Shares shall be rounded among the International
Managers to avoid fractional shares. The International Managers agree to offer
the Shares to the public as set forth in the International Prospectus. Each
International Manager agrees that, except to the extent permitted by the
Agreement Between U.S. Underwriters and International Managers, it will not
offer any of the Shares inside the United States.
The obligations of the Selling Stockholders to sell any Shares, and
the obligations of the International Managers to purchase the Shares, are
subject to the closing of the sale and purchase of the U.S. Shares pursuant to
the U.S. Underwriting Agreement.
5. Delivery of and Payment for Shares. Delivery of certificates for
-----------------------------------
the Shares shall be made at the offices of Lehman Brothers Inc., 388 Greenwich
Street (Cashier's Window, Main Level), New York, New York 10013 (or such other
place as mutually may be agreed upon), at 10:00 A.M., New York City time, on the
[third] full Business Day following the date of this Agreement or on such later
date as shall be determined by you and the Company (the "Closing Date").
<PAGE>
13
Delivery of certificates for the Shares shall be made by or on behalf
of the Selling Stockholders to you, for the respective accounts of the
International Managers, against payment of the purchase price therefor by
certified or official bank check payable in New York Clearing House funds to the
order of the relevant Selling Stockholder. The certificates for the Shares
shall be registered in such names and denominations as you shall have requested
at least two full Business Days prior to the Closing Date, and shall be made
available for checking and packaging in New York, New York, or such other
location as may be designated by you at least one full Business Day prior to the
Closing Date. Time shall be of the essence, and delivery of certificates for
the Shares at the time and place specified in this Agreement is a further
condition to the obligations of each International Manager.
6. Covenants. The Company covenants and agrees with each
----------
International Manager that:
(a) The Company shall use its best efforts to cause the Registration
Statement, if not effective at the Execution Time, and any amendments thereto to
become effective. The Company shall advise you promptly of the filing of any
amendment to the Registration Statement or any supplement to any Prospectus and,
upon notification from the Commission that the Registration Statement or any
such amendment has become effective, shall so advise you promptly (in writing,
if requested). If the Registration Statement has become or becomes effective
pursuant to Rule 430A, or filing of any Prospectus is otherwise required under
Rule 424(b), the Company will cause such Prospectus, properly completed, and any
supplement thereto to be filed with the Commission pursuant to the applicable
paragraph of Rule 424(b) in the manner and within the time period prescribed and
will provide evidence satisfactory to the Lead Manager of such timely filing.
The Company shall notify you promptly of any request by the Commission for any
amendment of or supplement to the Registration Statement or any Prospectus or
for additional information; the Company shall prepare and file with the
Commission, promptly upon your request, any amendments or supplements to the
Registration Statement or the International Prospectus which, in your reasonable
opinion, may be necessary or advisable in connection with the distribution of
the Shares; and the Company shall not file any amendment or supplement to the
Registration Statement or the International Prospectus, or file any document
under the Exchange Act before the termination of
<PAGE>
14
the offering of the Shares by the International Managers if such document would
be deemed to be incorporated by reference into the International Prospectus,
which filing is not consented to by you after reasonable notice thereof. The
Company shall advise you promptly of the issuance by the Commission or any state
or other governmental or regulatory body of any stop order or other order
suspending the effectiveness of the Registration Statement, suspending or
preventing the use of any Preliminary Prospectus or Prospectus or suspending the
qualification of the Shares for offering or sale in any jurisdiction, or of the
institution of any proceedings for any such purpose; and the Company shall use
its best efforts to prevent the issuance of any stop order or other such order
and, should a stop order or other such order be issued, to obtain as soon as
possible the lifting thereof.
(b) The Company shall furnish promptly to the Representative and to
counsel for the International Managers one signed copy of the Registration
Statement as originally filed and each amendment thereto filed with the
Commission, including all consents and exhibits filed therewith, and shall
furnish to the International Managers such number of conformed copies of the
Registration Statement, as originally filed and each amendment thereto
(excluding exhibits other than this Agreement), any Preliminary Prospectus, the
International Prospectus and all amendments and supplements to any of such
documents, and any document incorporated by reference in the Prospectuses, in
each case as soon as available and in such quantities as the Lead Manager may
from time to time reasonably request; and the Company authorizes the
International Managers and all dealers to whom any Shares may be offered or sold
by the several International Managers to use the International Prospectus, and
if supplemented or amended then after such date as supplemented or amended,
during the period referred to in Section 6(a) in connection with the sale of the
Shares in accordance with the applicable provisions of the Securities Act, the
Rules and Regulations thereunder and this Agreement.
(c) Within the time during which the Prospectuses relating to the
Shares are required to be delivered under the Securities Act, the Company shall
comply with all requirements imposed upon it by the Securities Act, the Exchange
Act and the Rules and Regulations so far as is necessary to permit the
continuance of sales of or dealings in the Shares as contemplated by the
provisions hereof and
<PAGE>
15
by the Prospectuses. If during such period any event occurs as a result of
which the International Prospectus as then amended or supplemented would include
an untrue statement of a material fact or omit to state a material fact
necessary to make the statements therein, in the light of the circumstances then
existing, not misleading, or if during such period it is necessary to amend the
Registration Statement or supplement the International Prospectus to comply with
the Securities Act or the Exchange Act or the Rules and Regulations or to file
any document under the Exchange Act incorporated by reference into the
International Prospectus, the Company shall promptly notify you and, subject to
the penultimate sentence of paragraph (a) of this Section 6, shall amend the
Registration Statement or supplement the International Prospectus or file such
document (at the expense of the Company) so as to correct such statement or
omission or to effect such compliance.
(d) The Company shall take or cause to be taken all reasonable action
and furnish to whomever you may direct such information as may be required in
qualifying the Shares (and any U.S. Shares that may be sold to the International
Managers by the U.S. Underwriters) for sale under the laws of such jurisdictions
as you shall designate and to continue such qualifications in effect for as long
as may be necessary for the distribution of the Shares (and such U.S. Shares);
except that in no event shall the Company be obligated in connection therewith
to qualify as a foreign corporation or to execute a general consent to service
of process.
(e) The Company shall make generally available to its security
holders (and shall deliver to the Representative), in the manner contemplated by
Rule 158(b) under the Securities Act or otherwise, as soon as practicable but in
any event not later than 45 days after the end of its fiscal quarter in which
the first anniversary date of the Effective Date occurs, an earnings statement
satisfying the requirements of Section 11(a) of the Securities Act and covering
a period of at least 12 consecutive months beginning after the Effective Date.
(f) The Company shall not, during the 90 days following the date of
the Prospectuses, except with the prior written consent of the Lead Manager or
otherwise in accordance with this Agreement, offer, sell or contract to sell or
otherwise dispose of (or enter into any transaction which is designed to, or
could be expected to, result in the
<PAGE>
16
disposition by any person of), directly or indirectly, or announce the offering
of, any shares of Common Stock, or any options, rights or warrants with respect
to shares of Common Stock or any securities convertible into, or exchangeable
for, shares of Common Stock (except for the issuance of shares of Common Stock
pursuant to employee benefit plans or existing options or the grant of options
pursuant to employee benefit plans ("Plan Shares")). The Company shall not
take, directly or indirectly, any action designed to cause or result in, or
which might reasonably be expected to constitute, the stabilization or
manipulation of the price of the shares of Common Stock to facilitate the sale
or resale of the Shares.
(g) Whether or not this Agreement becomes effective or is terminated
or the sale of the Shares to the International Managers is consummated, the
Company shall pay or cause to be paid (A) all expenses (including stock transfer
taxes) incurred in connection with the delivery to the several U.S. Underwriters
of the Shares, (B) all fees and expenses (including, without limitation, fees
and expenses of the Company's accountants and counsel, but excluding fees and
expenses of counsel for the International Managers) in connection with the
preparation, printing, filing, delivery and shipping of the Registration
Statement (including the financial statements therein and all amendments and
exhibits thereto), each Preliminary Prospectus, the Prospectuses and any
amendments or supplements of the foregoing and any documents incorporated by
reference into any of the foregoing and the reproduction, delivery and shipping
of this Agreement, the U.S. Underwriting Agreement and other underwriting
documents, including, but not limited to, Underwriters' Questionnaires,
Underwriters' Powers of Attorney, Blue Sky Memoranda, Legal Investment Surveys,
Agreements Among Underwriters, Selected Dealer Agreements, the Agreement Between
U.S. Underwriters and International Managers, the Agreements Among International
Managers and the International Selling Agreements, (C) all filing fees and fees
and disbursements of counsel to the International Managers incurred in
connection with the qualification of the Shares under state securities laws as
provided in Section 6(d) hereof, (D) the filing fee of the National Association
of Securities Dealers, Inc., if any, (E) any applicable listing or stock
exchange fees, (F) the cost of printing certificates representing the Shares,
(G) the cost and charges of any transfer agent or registrar and (H) all other
costs and expenses incident to the performance of its obligations hereunder for
which provision is not otherwise made in this
<PAGE>
17
Section. It is understood, however, that, except as provided in this Section,
Section 9 and Section 10 hereof, the International Managers shall pay all their
own costs and expenses, including the fees of their counsel, stock transfer
taxes due upon resale of any of the Shares by them and any advertising expenses
incurred in connection with any offers they may make. It is further understood
that the Company shall pay such registration expenses for which it is
responsible under the Standstill Agreement (including the Registration Rights
Agreement attached thereto) dated as of August 14, 1992, as amended as of
November 13, 1992 (the "Standstill Agreement"), and the Selling Stockholders
shall pay such costs and expenses for which they are responsible under the
Standstill Agreement. If the sale of the Shares provided for herein is not
consummated by reason of acts of the Company or the Selling Stockholders
pursuant to Section 10 hereof which prevent this Agreement from becoming
effective, or by reason of any failure, refusal or inability on the part of the
Company or the Selling Stockholders to perform in all material respects any
agreement on its part to be performed or because any condition of the
International Managers' obligations hereunder to be performed by the Company is
not fulfilled or if the International Managers shall decline to purchase the
Shares for any reason permitted under this Agreement, the Company or the Selling
Stockholders, as the case may be, shall reimburse the several International
Managers for all reasonable out-of-pocket disbursements (including fees and
disbursements of counsel) incurred by the International Managers in connection
with any investigation or preparation made by them in respect of the marketing
of the Shares or in contemplation of the performance by them of their
obligations hereunder.
(h) Until the termination of the offering of the Shares, the Company
shall timely file all documents, and any amendments to previously filed
documents, required to be filed by the Company pursuant to Section 13(a), 13(c),
14 or 15(d) of the Exchange Act.
(i) During a period of three years from the Effective Date, the
Company shall furnish to the Lead Manager copies of all reports or other
communications furnished to shareholders and copies of any reports or financial
statements furnished to or filed with the Commission or any national securities
exchange on which any class of securities of the Company shall be listed.
<PAGE>
18
7. Further Agreements of the Selling Stockholders. Each Selling
-----------------------------------------------
Stockholder covenants and agrees with each International Manager that such
Selling Stockholder will deliver to the Lead Manager prior to the Closing Date a
properly completed and executed United States Treasury Department Form W-9 or
Form W-8, as the case may be.
8. Conditions of International Managers' Obligations. The respective
--------------------------------------------------
obligations of the several International Managers hereunder are subject to the
accuracy, as of the date hereof and the Closing Date (as if made at the Closing
Date), of the representations and warranties of the Company and the Selling
Stockholders contained herein, to the performance in all material respects by
the Company and the Selling Stockholders of their respective obligations
hereunder and to the following additional terms and conditions:
(a) The Registration Statement shall have become effective not later
than 11:00 A.M., New York City time, on the first full Business Day following
the date hereof (unless already effective), all post-effective amendments to the
Registration Statement shall have become effective, all filings required by Rule
424 shall have been made and no such filings shall have been made without the
consent of the Representatives; no stop order suspending the effectiveness of
the Registration Statement or any amendment or supplement thereto nor any order
directed to any document incorporated by reference shall have been issued; no
proceedings for the issuance of any such order shall have been initiated or
threatened; and any request of the Commission for additional information (to be
included in the Registration Statement or the Prospectuses or otherwise) shall
have been disclosed to you and complied with to your satisfaction; and after the
date hereof, the Company shall not have filed with the Commission any amendment
or supplement to the Registration Statement or the Prospectuses (or any document
incorporated by reference therein) without the consent of the Lead Manager,
which consent will not have been unreasonably withheld or delayed.
(b) No International Manager or U.S. Underwriter shall have
discovered and disclosed to the Company that the Registration Statement, the
Preliminary Prospectuses or the Prospectuses or any amendment or supplement
thereto, contains an untrue statement of fact that, in the opinion of counsel to
the International Managers, is material, or omits to state a fact that, in the
opinion of counsel to the
<PAGE>
19
International Managers, is material and is required to be stated therein or is
necessary to make the statements therein not misleading except, in the case of a
Preliminary Prospectus, to the extent such misstatement or omission has been
corrected in a subsequent Preliminary Prospectus or Prospectus.
(c) All corporate proceedings and other legal matters incident to the
authorization, form and validity of this Agreement, the Shares, and the form of
the Registration Statement, the International Prospectus (other than financial
statements and other financial data) and all other legal matters relating to
this Agreement, such other documents and the transactions contemplated hereby
shall be reasonably satisfactory in all material respects to counsel for the
International Managers, and the Company shall have furnished to such counsel all
documents and information that such counsel may reasonably request to enable it
to pass upon such matters.
(d) There shall have been furnished to you a certificate, dated the
Closing Date and addressed to you, signed by the Chief Executive Officer and by
the Chief Financial Officer of the Company, certifying that the signers of said
certificate have carefully examined the Registration Statement, any Preliminary
Prospectuses and the Prospectuses, and any amendments or supplements thereto
(including all documents incorporated by reference therein) and, to the best of
their knowledge:
(i) There has not been, since the respective dates as of which
information is given in the Registration Statement, any material adverse
change in the condition, financial or otherwise, or the earnings, assets,
affairs or business prospects of the Company and its subsidiaries
considered as a whole, whether or not arising in the ordinary course of
business, except as set forth in, or contemplated by, the Registration
Statement, any Preliminary Prospectuses and the Prospectuses.
(ii) The representations and warranties of the Company contained in
this Agreement are true and correct with the same force and effect as
though expressly made at and as of the Closing Date.
<PAGE>
20
(iii) The Company has complied with all agreements and satisfied all
conditions on its part to be performed or satisfied at or prior to the
Closing Date.
(iv) No stop order suspending the effectiveness of the Registration
Statement has been issued and no proceedings for the purpose have been
initiated or threatened by the Commission.
(v) Such documents do not include any untrue statement of material
fact or omit to state any material fact required to be stated therein or
necessary to make the statements therein not misleading.
The delivery of the certificate provided for in this sub paragraph (d) shall be
and constitute a representation and warranty of the Company as to the facts
required in the immediately foregoing clause (i), (ii), (iii), (iv) and (v) of
this subparagraph (d) to be set forth in such certificate.
(e) At the Execution Time and on the Closing Date, you shall have
received a letter of Coopers & Lybrand, dated such date and addressed to you,
confirming that they are independent certified public accountants within the
meaning of the Securities Act and the applicable published Rules and Regulations
with respect to the Company and stating, as of the date of such letter (or, with
respect to matters involving changes or developments since the respective dates
as of which specified financial information is given or incorporated in the
International Prospectus, as of a date not more than five Business Days prior to
the date of such letter), the conclusions and findings of such firm with respect
to the financial information and other matters covered by its letter delivered
to you concurrently with the execution of this Agreement, and confirming the
conclusions and findings set forth in such prior letter.
(f) Since the latest date as of which such condition is set forth in
the Registration Statement, the Preliminary Prospectus and the Prospectuses,
there shall have been no material adverse change in the condition, financial or
otherwise, or the earnings, affairs or business prospects of the Company and its
subsidiaries considered as a whole, except as set forth in, or clearly
contemplated by, the Registration Statement, any Preliminary Prospectuses and
the Prospectuses.
<PAGE>
21
(g) On the Closing Date there shall have been furnished to you the
opinion of (addressed to the U.S. Underwriters) of Willkie Farr & Gallagher,
counsel for the Company, dated the Closing Date and in form and substance
satisfactory to counsel for the International Managers, to the effect that:
(i) The Registration Statement is effective under the Securities Act;
any required filing of the Prospectuses and any supplements thereto
pursuant to Rule 424(b) has been made in the manner and within the time
period required by Rule 424(b); to the best of such counsel's knowledge, no
stop order suspending its effectiveness has been issued, and such counsel
does not know of any proceeding for that purpose pending or threatened by
the Commission.
(ii) At the time the Registration Statement became effective, the
Registration Statement (other than the financial statements and the notes
thereto and the supporting schedules and other financial and statistical
data derived therefrom included or incorporated by reference therein, as to
which no opinion need be rendered) complied as to form in all material
respects with the requirements of the Securities Act and the Rules and
Regulations, and the documents incorporated by reference therein, at the
time they were filed with the Commission, complied as to form in all
material respects with the Exchange Act and the applicable Rules and
Regulations (except as aforesaid).
(iii) The Company has been duly incorporated and is validly existing
as a corporation in good standing under the laws of the State of New York
and has full corporate power and authority to own, lease and operate its
properties and conduct its business as described in the Registration
Statement.
(iv) This Agreement has been duly and validly authorized, executed
and delivered by the Company.
(v) No authorization, approval, consent or other instrument or order
of any federal or state court or federal or state governmental authority or
agency is required in connection with the sale of the Shares to the
International Managers, except such as have been obtained under the
Securities Act, the Exchange Act and the Rules and Regulations thereunder,
and except for
<PAGE>
22
such as may be required under state or foreign securities laws; and the
execution and delivery of this Agreement and the consummation of the
transactions contemplated herein will not result in any violation of the
provisions of the charter or by-laws of the Company, or, to the best
knowledge and information of such counsel, any applicable law,
administrative regulation or administrative or court decree.
(vi) The authorized capital stock of the Company conforms to the
description thereof contained in the Preliminary Prospectuses and the
Prospectuses.
(vii) The Shares have been duly authorized for listing on the New
York Stock Exchange.
(viii) The Shares are duly authorized, validly issued, fully paid and
nonassessable and the certificates for the Shares are in valid and
sufficient form.
(ix) Such counsel also shall state that nothing has come to their
attention that would lead such counsel to believe that the Registration
Statement (other than the financial statements and the notes thereto and
the supporting schedules and other financial and statistical data derived
therefrom included or incorporated by reference therein, as to which no
opinion need be rendered), at the time it became effective, contained an
untrue statement of a material fact or omitted to state a material fact
required to be stated therein or necessary in order to make the statements
therein not misleading or that the Prospectuses at the date hereof and at
the Closing Date included an untrue statement of a material fact or omitted
to state a material fact necessary in order to make the statements therein,
in the light of the circumstances under which they were made, not
misleading.
(h) On the Closing Date there shall have been furnished to you the
opinion (addressed to the U.S. Underwriters) of Michael B. Targoff, Esq., Senior
Vice President and Secretary of the Company, dated the Closing Date and in form
and substance satisfactory to counsel for the U.S. Underwriters, to the effect
that:
(i) The Company has been duly incorporated, is validly existing as a
corporation in good standing
<PAGE>
23
under the laws of the State of New York and has full corporate power and
authority to own, lease and operate its properties and to conduct its
business as described in the Registration Statement.
(ii) To the best of such counsel's knowledge and information, the
Company is duly qualified to do business and is in good standing in each
jurisdiction in which its ownership or leasing of properties requires such
qualification or the conduct of its business requires such qualification
(except where the failure to so qualify would not have a material adverse
effect on the condition, financial or otherwise, of the Company and its
subsidiaries considered as a whole, or on the earnings, assets, affairs or
business prospects of the Company and its subsidiaries considered as a
whole).
(iii) Each Significant Subsidiary of the Company, each of which shall
be identified in such opinion, has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the
jurisdiction of its incorporation, and has full corporate power and
authority to own, lease and operate its properties and to conduct its
business as described in the Registration Statement; and is duly qualified
to do business and is in good standing in each jurisdiction in which its
ownership or leasing of properties requires such qualification or the
conduct of its business requires such qualification (except where the
failure to so qualify would not have a material adverse effect on the
condition, financial or otherwise, of the Company and its subsidiaries
considered as a whole, or on the earnings, assets, affairs of business
prospects of the Company and its subsidiaries considered as a whole); and
all the issued and outstanding capital stock of each such subsidiary has
been duly authorized and validly issued and is fully paid and
nonassessable, and, except to the extent set forth in the Registration
Statement, all such capital stock owned by the Company is, to the best of
such counsels knowledge and information, owned free and clear of any
pledge, lien, encumbrance, claim or equity.
(iv) This Agreement and the U.S. Underwriting Agreement have been
duly and validly authorized, executed and delivered by the Company.
<PAGE>
24
(v) To the best of such counsel's knowledge and information, there
are no legal or governmental proceedings pending or threatened which are
required to be disclosed in the Registration Statement, other than those
disclosed therein, and all pending legal or governmental proceedings to
which the Company or any subsidiary is a party or to which any of their
property is subject which are not described in the Registration Statement,
including ordinary routine litigation incidental to the business, are,
considered in the aggregate, not material with respect to the Company and
its subsidiaries considered as a whole.
(vi) To the best of such counsel's knowledge and information, there
are no contracts, indentures, mortgages, loan agreements, notes, deeds of
trust, leases or other instruments required to be described or referred to
in the Registration Statement or to be filed as exhibits thereto other than
those described or referred to therein or filed or incorporated by
reference as exhibits thereto, the descriptions thereof or references
thereto are correct in all material respects, and no default exists in the
due performance or observance of any material obligation, agreement,
covenant or condition contained in any material contract, indenture,
mortgage, loan agreement, note, deed of trust, lease or other instrument so
described, referred to, filed or incorporated by reference.
(vii) No consent, approval, authorization, order, registration or
qualification of or with any court or any regulatory authority or other
governmental body is required in connection with the sale of the Shares,
except such as have been obtained under the Securities Act and such
consents, approvals, authorizations, registrations or qualifications as may
be required under the securities or Blue Sky laws of certain jurisdictions
or the laws of any country other than the United States; and the execution,
delivery and performance of this Agreement and the U.S. Underwriting
Agreement, the consummation of the transactions herein and therein
contemplated, will not conflict with, or result in a breach of any of the
terms or provisions of, or constitute a default under, or result in the
creation or imposition of any lien, charge or encumbrance upon, any of the
property or assets of the Company or its subsidiaries pursuant to any
contract, indenture, mortgage, loan agreement, note, deed of
<PAGE>
25
trust, lease or other instrument to which the Company or any of its
subsidiaries is a party or by which the Company or any of its subsidiaries
is bound or to which any of the property or assets of the Company or any of
its subsidiaries is subject, nor will such action result in any violation
of the provisions of the Certificate of Incorporation or the By-laws, in
each case as amended, of the Company, or any statute or any order, rule or
regulation of any court or governmental agency or body having jurisdiction
over the Company or any of its subsidiaries or any of their properties.
(viii) To the best of such counsel's knowledge, no stop order
suspending the effectiveness of the Registration Statement has been issued
and no proceedings for that purpose have been instituted or are pending or,
contemplated under the Securities Act.
(ix) The authorized capital stock of the Company conforms to the
description thereof contained in the Registration Statement, and all the
outstanding shares of capital stock of the Company including the Shares
have been duly and validly authorized and issued and are fully paid and
nonassessable; there are no preemptive or other rights to subscribe for or
to purchase, or any restriction upon the voting or transfer of the Shares
pursuant to the Company's Certificate of Incorporation or By-laws, in each
case as amended, or, to the knowledge of such counsel, pursuant to any
agreement or other instrument to which the Company or its subsidiaries is a
party or by which any of them may be bound; and neither the filing of the
Registration Statement nor the offering of the Shares as contemplated by
this Agreement gives rise to any rights, other than those which have been
waived or satisfied, for or relating to the registration of any other
shares of Common Stock.
(x) The Registration Statement, the Prospectuses and each amendment
or supplement thereto, as of their respective effective or issue dates,
complied as to form in all material respects with the requirements of the
Securities Act and the Rules and Regulations thereunder (except, in each
case, for the financial statements and other financial data contained or
incorporated therein, as to which no opinion need be expressed), and the
documents incorporated by reference therein, at the time they were filed
with the Commis-
<PAGE>
26
sion, complied as to form in all material respects with the Exchange Act
and the applicable Rules and Regulations thereunder (except as aforesaid).
In passing upon the form of the Registration Statement, the Prospectuses
and the documents incorporated by reference therein, such counsel has
necessarily assumed the correctness and completeness of the statements made
or included therein and takes no responsibility therefor, except insofar as
such statements relate to the opinions set forth above or relate to such
counsel. Such counsel shall state that, in the course of the preparation
of the Registration Statement and the Prospectuses, he has participated in
conferences with certain officers of the Company, and that his examination
of the Registration Statement and the Prospectuses and discussions in the
above-mentioned conferences did not disclose to him any information which
gave him reason to believe that the Registration Statement (except for the
financial statements and other financial data contained or incorporated
therein, as to which no opinion need be expressed), at the time it became
effective, contained an untrue statement of a material fact or omitted to
state a material fact required to be stated therein or necessary to make
the statements therein not misleading, or that the Prospectuses (except as
aforesaid), on the date hereof and on the Closing Date, included an untrue
statement of a material fact or omitted to state a material fact necessary
in order to make the statements therein, in light of the circumstances
under which they were made, not misleading.
(i) On the Closing Date, there shall have been furnished to you the
opinion of counsel for each of the Selling Stockholders (addressed to the
International Managers), dated the Closing Date in form and substance
satisfactory to the International Managers to the effect that:
(i) Each Selling Stockholder has full right, power and authority to
enter into this Agreement and the U.S. Underwriting Agreement and to
perform its obligations hereunder and thereunder.
(ii) This Agreement and the U.S. Underwriting Agreement have each
been duly authorized, executed and delivered by or on behalf of each
Selling Stockholder.
<PAGE>
27
(iii) The execution, delivery and performance of this Agreement and
the U.S. Underwriting Agreement by each Selling Stockholder and the
consummation by each Selling Stockholder of the transactions contemplated
hereby and thereby will not conflict with or result in a breach or
violation in any material respect of any of the terms or provisions of, or
constitute a default under, any material indenture, mortgage, deed of
trust, loan agreement or other agreement or instrument known to such
counsel to which each Selling Stockholder is a party or by which each
Selling Stockholder is bound or to which any of the property or assets of
each Selling Stockholder is subject, nor will such actions result in any
violation in any material respect of the provisions of the partnership
agreement of each Selling Stockholder or any statute or any order, rule or
regulation known to such counsel of any court or governmental agency having
jurisdiction over each Selling Stockholder or the property or assets of
each Selling Stockholder; and no consent, approval, authorization or order
of, or filing or registration with, any such court or governmental agency
is required for the execution, delivery and performance of this Agreement
and the U.S. Underwriting Agreement by each Selling Stockholder and the
consummation by each Selling Stockholder of the transactions contemplated
hereby and thereby, except the registration under the Securities Act of the
Shares, such consents, approvals, authorizations, registrations, filings or
qualifications as may be required under state securities or Blue Sky laws
in connection with the purchase and distribution of the shares by the
International Managers or as may be required by the laws of any country
other than the United States, and amendments to filings made under the
Exchange Act.
(j) On or prior to the Closing Date, you shall have received from
Cravath, Swaine & Moore, counsel for the International Managers, such opinion or
opinions and letter or letters with respect to corporate proceedings by the
Company, the form of the Registration Statement and the International Prospectus
(other than financial statements and other financial data), the validity of the
Shares and other related matters as you may reasonably request, and such counsel
shall have received such documents and information as they request to enable
them to pass upon such matters.
<PAGE>
28
(k) Each Selling Stockholder shall have furnished to the Lead Manager
on the Closing Date a certificate, dated the Closing Date, signed by, or on
behalf of, each Selling Stockholder stating that the representations, warranties
and agreements of the Selling Stockholder contained herein are true and correct
in all material respects as of the Closing Date and that the Selling Stockholder
has complied in all material respects with all agreements contained herein to be
performed by the Selling Stockholder at or prior to the Closing Date.
Each of Willkie Farr & Gallagher, Michael B. Targoff, Esq., and
Cravath, Swaine & Moore, in rendering their respective opinion or opinions, may
rely as to matters of fact, to the extent they deem proper and specify in such
opinion or opinions, on certificates of responsible officers of the Company and
its subsidiaries and public officials. Each of Willkie Farr & Gallagher,
Michael B. Targoff, Esq., and Cravath, Swaine & Moore may limit their opinions
to matters relating to United States federal laws and the laws of the State of
New York.
All such opinions, certificates, letters and documents shall be in
compliance with the provisions hereof only if they are reasonably satisfactory
in form and substance to you and to counsel for the International Managers. The
Company shall furnish to you conformed copies of such opinions, certificates,
letters and other documents in such number as you shall reasonably request. If
any of the conditions specified in this Section 8 shall not have been fulfilled
when and as required by this Agreement, this Agreement and all obligations of
the International Managers hereunder may be cancelled at, or at any time prior
to, each Closing Date, by you. Any such cancellation shall be without liability
of the International Managers to the Company. Notice of such cancellation shall
be given the Company in writing, or by telecopy or telephone and confirmed in
writing.
9. Indemnification and Contribution. (a) The Company shall
---------------------------------
indemnify and hold harmless each International Manager against any loss, claim,
damage or liability (or any action in respect thereof), joint or several, to
which such International Manager may become subject, under the Securities Act or
otherwise, insofar as such loss, claim, damage or liability (or action in
respect thereof) arises out of or is based upon (i) any untrue statement or
alleged untrue statement of a material fact contained in the Registration
<PAGE>
29
Statement, any Preliminary Prospectus, any Prospectus or the Registration
Statement or any Prospectus as amended or supplemented or in any blue sky
application or other document executed by the Company specifically for that
purpose or based upon written information furnished by the Company filed in any
state or other jurisdiction in order to qualify any of or all the Shares under
the securities laws thereof (any such application, document or information being
hereinafter referred to as a "Blue Sky Application") or (ii) the omission or
alleged omission to state in the Registration Statement, any Preliminary
Prospectus, any Prospectus or the Registration Statement or any Prospectus as
amended or supplemented or in any Blue Sky Application a material fact required
to be stated therein or necessary to make the statements therein not misleading,
and shall reimburse each International Manager promptly after receipt of
invoices from such International Manager for any legal or other expenses as
reasonably incurred by such International Manager in connection with
investigating, preparing to defend or defending against or appearing as a third-
party witness in connection with any such loss, claim, damage, liability or
action, notwithstanding the possibility that payments for such expenses might
later be held to be improper, in which case such payments shall be promptly
refunded; provided, however, that the Company shall not be liable under this
-------- -------
Section 9(a) in any such case to the extent that any such loss, claim, damage,
liability or action arises out of or is based upon (x) an untrue statement or
alleged untrue statement or omission or alleged omission made in reliance upon
and in conformity with written information furnished to the Company through the
Lead Managers by or on behalf of any International Manager specifically for use
in the preparation of the Registration Statement, any Preliminary Prospectus,
any Prospectus or the Registration Statement or any Prospectus as amended or
supplemented, or any Blue Sky Application, or (y) the sole fact that the
International Manager failed to send or give a copy of the Prospectus, as the
same may be amended or supplemented (but excluding documents incorporated by
reference), to a person purchasing securities, within the time required by
applicable law, if the delivery of the Prospectus (as so amended or
supplemented) would have cured the defect giving rise to the claim, unless the
Company failed to comply with its obligations under Section 6(b) of this
Agreement.
(b) Each Selling Stockholder agrees, severally but not jointly, to
indemnify and hold harmless each International Manager to the same extent as the
foregoing indem-
<PAGE>
30
nity from the Company to each International Manager, but only with reference to
written information related to such Selling Stockholder furnished to the Company
by or on behalf of the Selling Stockholders specifically for inclusion in the
documents referred to in the foregoing indemnity.
(c) Each International Manager severally, but not jointly, shall
indemnify and hold harmless the Company and the Selling Stockholders against any
loss, claim, damage or liability (or any action in respect thereof) to which the
Company or any Selling Stockholder may become subject, under the Securities Act
or otherwise, insofar as such loss, claim, damage or liability (or action in
respect thereof) arises out of or is based upon (i) any untrue statement or
alleged untrue statement of a material fact contained in the Registration
Statement, any Preliminary Prospectus, any Prospectus or the Registration
Statement or any Prospectus as amended or supplemented, or in any Blue Sky
Application or (ii) the omission or alleged omission to state in the
Registration Statement, any Preliminary Prospectus, any Prospectus or the
Registration Statement or any Prospectus as amended or supplemented, or in any
Blue Sky Application a material fact required to be stated therein or necessary
to make the statements therein not misleading, and shall reimburse the Company
and the Selling Stockholders promptly after receipt of invoices from the Company
or any Selling Stockholder for any legal or other expenses as reasonably
incurred by the Company or any Selling Stockholder in connection with
investigating, preparing to defend or defending against or appearing as a third-
party witness in connection with any such loss, claim, damage, liability or
action notwithstanding the possibility that payments for such expenses might
later be held to be improper, in which case such payments shall be promptly
refunded; provided, however, that such indemnification or reimbursement shall be
-------- -------
available in each such case to the extent, but only to the extent, that such
untrue statement or alleged untrue statement or omission or alleged omission was
made in reliance upon and in conformity with written information furnished to
the Company through you by or on behalf of such International Manager
specifically for use in the preparation thereof.
(d) Promptly after receipt by any indemnified party under subsection
(a), (b) or (c) above of notice of any claim or the commencement of any action,
the indemnified party shall, if a claim in respect thereof is to be made against
the indemnifying party under such subsection, notify
<PAGE>
31
the indemnifying party in writing of the claim or the commencement of that
action; provided, however, that the failure so to notify the indemnifying party
-------- -------
shall not relieve it from any liability which it may have under this Section 9
except to the extent it has been prejudiced in any material respect by such
failure or from any liability which it may have to an indemnified party
otherwise than under this Section 9. If any such claim or action shall be
brought against any indemnified party and it shall notify the indemnifying party
thereof, the indemnifying party shall be entitled to participate therein and, to
the extent that it wishes, jointly with any other similarly notified indemnified
party, to assume the defense thereof with counsel reasonably satisfactory to the
indemnified party. After notice from the indemnifying party to the indemnified
party of its election to assume the defense of such claim or action, the
indemnifying party shall not be liable to the indemnified party under such
subsection for any legal or other expenses subsequently incurred by the
indemnified party in connection with the defense thereof other than reasonable
costs of investigation; except that the indemnified party shall have the right
to employ separate counsel (including local counsel), and the indemnifying party
shall bear the reasonable fees, costs and expenses of such separate counsel, if
the use of counsel chosen by the indemnifying party to represent the indemnified
party would in the indemnified party's reasonable judgment present such counsel
with a conflict of interest or the indemnified party reasonably determines that
there may be legal defenses available to it which are different from or in
addition to those available to the indemnifying party. It is understood that
the indemnifying party shall not, in connection with any proceeding or related
proceedings in the same jurisdiction, be liable for the reasonable fees and
expenses of more than one separate firm (in addition to any local counsel) for
all such indemnified parties. The indemnifying party shall not be liable for
any settlement of any proceeding effected without its written consent, but if
settled with such consent or if there be a final judgment for the plaintiff, the
indemnifying party agrees to indemnify the indemnified party from and against
any loss or liability by reason of such settlement or judgment. The
indemnifying party shall not, without the prior consent of the indemnified
party, which consent will not be unreasonably withheld, enter into any
settlement of a lawsuit, claim or other proceeding unless such settlement
includes an explicit and unconditional release from the party bringing such
lawsuit, claim or other proceeding of the indemnified party.
<PAGE>
32
(e) If the indemnification provided for in this Section 9 is
unavailable to hold harmless an indemnified party under subsection (a), (b) or
(c) above, then each indemnifying party shall, in lieu of indemnifying such
indemnified party, contribute to the amount paid or payable by such indemnified
party as a result of the losses, claims, damages or liabilities referred to in
subsection (a), (b) or (c) above (i) in such proportion as is appropriate to
reflect the relative benefits received by the Company and the Selling
Stockholders, on the one hand, and the International Managers, on the other
hand, from the offering of the Shares or (ii) if the allocation provided by
clause (i) above is not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits referred to in clause (i)
above but also the relative fault of the Company and the Selling Stockholders,
on the one hand, and the International Managers, on the other hand, in
connection with the statements or omissions that resulted in such losses,
claims, damages or liabilities, or actions in respect thereof, as well as any
other relevant equitable considerations. The relative benefits received by the
Company and the Selling Stockholders, on the one hand, and the International
Managers, on the other hand, shall be deemed to be in the same proportion as the
total proceeds from the offering of the Shares (net of underwriting discounts
and commissions but before deducting expenses) received by the Company and the
Selling Stockholders, on the one hand, bear to the total underwriting discounts
and commissions received by the International Managers, on the other hand, in
each case as set forth in the table on the cover page of the International
Prospectus (with the estimated expenses allocated pro rata among the Shares and
the U.S. Shares). Relative fault shall be determined by reference to, among
other things, whether the untrue or alleged untrue statement of a material fact
or the omission or alleged omission to state a material fact relates to
information supplied by the Company, the Selling Stockholders or the
International Managers and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such untrue statement or
omission. The Company, the Selling Stockholders and the International Managers
agree that it would not be just and equitable if contributions pursuant to this
subsection (e) were to be determined by pro rata allocation (even if the
International Managers were treated as one entity for such purpose) or by any
other method of allocation which does not take into account the equitable
considerations referred to in the first sentence of this subsection (e). The
amount paid by
<PAGE>
33
an indemnified party as a result of the losses, claims, damages or liabilities
(or actions in respect thereof) referred to in the first sentence of this
subsection (e) shall be deemed to include any legal or other expenses reasonably
incurred by such indemnified party in connection with investigating, preparing
to defend or defending against any action or claim which is the subject of this
subsection (e). Notwithstanding the provisions of this subsection (e), (i) no
International Manager shall be required to contribute any amount in excess of
the amount by which the total price at which the Shares underwritten by it and
distributed to the public were offered to the public exceeds the amount of any
damages which such International Manager has otherwise been required to pay by
reason of such untrue or alleged untrue statement or omission or alleged
omission, and (ii) no Selling Stockholder shall be required to contribute any
amount in excess of the amount by which the total price at which the Shares of
such Selling Stockholder were offered to the public (less underwriting discounts
and commissions) exceeds the amount of damages which such Selling Stockholder
has otherwise been required to pay by reason of such untrue statement or alleged
untrue statement or omission or alleged omission. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. The International Managers'
obligations in this subsection (e) to contribute are several in proportion to
their respective underwriting obligations and not joint. Each party entitled to
contribution agrees that upon the service of a summons or other initial legal
process upon it in any action instituted against it in respect of which
contribution may be sought, it shall promptly give written notice of such
service to the party or parties from whom contribution may be sought, but the
omission so to notify such party or parties of any such service shall not
relieve the party from whom contribution may be sought for any obligation it may
have hereunder or otherwise (except as specifically provided in subsection (d)
hereof). Each Selling Stockholder's obligation to contribute pursuant to this
Section 9(e) is several, based on the proportion that the proceeds of the
offering received by such Selling Stockholder bears to the total proceeds of the
offering received by all Selling Stockholders, and not joint.
(f) The obligations of the Company under this Section 9 shall be in
addition to any liability which the Company may otherwise have, and shall
extend, upon the same
<PAGE>
34
terms and conditions, to each person, if any, who controls any International
Manager within the meaning of the Securities Act or the Exchange Act or the
Rules and Regulations thereunder; the obligations of the Selling Stockholders
under this Section 9 shall be in addition to any liability which the Selling
Stockholders may otherwise have, and shall extend, upon the same terms and
conditions to each person who controls any International Manager within the
meaning of the Securities Act or the Exchange Act or the Rules and Regulations
thereunder; and the obligations of the International Managers under this Section
9 shall be in addition to any liability that the respective International
Managers may otherwise have, and shall extend, upon the same terms and
conditions, to each director of the Company (including any person who, with his
or her consent, is named in the Registration Statement as about to become a
director of the Company) or general partner of any Selling Stockholder, to each
officer of the Company who has signed the Registration Statement and to each
person, if any, who controls the Company or any Selling Stockholder within the
meaning of the Securities Act or the Exchange Act or the Rules and Regulations
thereunder.
(g) The Company and the Selling Stockholders understand and agree
that, as among themselves, (i) the indemnification, contribution and related
agreements entered into by such parties are as set forth in the Standstill
Agreement and shall remain in full force and effect, (ii) no provision of this
Agreement affects or alters in any way the indemnification, contribution or
other obligations (whether or not related to indemnification or contribution
matters) of such parties under the Standstill Agreement and (iii) in the event
of any inconsistency between any provision of this Agreement and the Standstill
Agreement, the relevant provision or provisions of the Standstill Agreement
shall control.
10. Effective Date and Termination. (a) This Agreement shall become
-------------------------------
effective at 11:00 A.M., New York City time, on the first full Business Day
following the date hereof, or at such earlier time after the Registration
Statement becomes effective as you shall first release the Shares for sale to
the public. You shall notify the Company immediately after you have taken any
action which causes this Agreement to become effective. Until this Agreement is
effective, it may be terminated by the Company or the Selling Stockholders by
giving notice as hereinafter provided to you, or by you by giving notice as
hereinafter pro-
<PAGE>
35
vided to the Company and the Selling Stockholders, except that the provisions of
Section 6(g) and Section 9 shall at all times be effective. For purposes of
this Agreement, the release of the offering of the Shares for sale to the public
shall be deemed to have been made when you release, by telecopy or otherwise,
firm offers of the Shares to securities dealers or release for publication a
newspaper advertisement relating to the Shares, whichever occurs first.
(b) Until the Closing Date, this Agreement may be terminated by you
in your absolute discretion by giving notice as hereinafter provided to the
Company and the Selling Stockholders if (i) the Company shall have failed,
refused or been unable, at or prior to the Closing Date, to perform in all
material respects any agreement on its part to be performed hereunder, (ii) any
other condition of the International Managers' obligations hereunder is not
fulfilled, (iii) trading in the Common Stock of the Company is suspended by the
Commission or the New York Stock Exchange or trading in securities generally on
the New York Stock Exchange shall have been suspended or limited or minimum
prices shall have been established on such exchange by the Commission or such
exchange or other regulatory body or governmental authority having jurisdiction,
(iv) a banking moratorium is declared by either Federal or New York State
authorities or (v) the United States becomes engaged in hostilities or there is
an escalation of hostilities involving the United States or there is a
declaration of a national emergency or war by the United States, or (vi) there
shall have been such a material adverse change in general economic, political or
financial conditions, or the effect of international conditions on the financial
markets in the United States shall be such, as to, in your judgment, make it
inadvisable or impracticable to proceed with the delivery of the Shares. Any
termination of this Agreement pursuant to this Section 10 shall be without
liability on the part of the Company, the Selling Stockholders or any
International Manager, except as otherwise provided in Sections 6(g) and 9
hereof.
Any notice referred to above may be given at the address specified in
Section 12 hereof in writing or by telecopy or telephone, and if by telecopy or
telephone, shall be immediately confirmed in writing.
11. Survival of Certain Provisions. The agreements contained in
-------------------------------
Section 9 hereof and the representations, warranties and agreements of the
Company contained in
<PAGE>
36
Sections 2 and 6 hereof and the Selling Stockholders contained in Sections 3 and
7 hereof shall survive the delivery of the Shares to the International Managers
hereunder and shall remain in full force and effect, regardless of any
termination or cancellation of this Agreement or any investigation made by or on
behalf of any indemnified party.
12. Notices. Except as otherwise provided in the Agreement, (a)
--------
whenever notice is required by the provisions of this Agreement to be given to
the Company, such notice shall be in writing or by telecopy addressed to the
Company at 600 Third Avenue, New York, New York 10016, Attention: Michael B.
Targoff, Esq., Senior Vice President and Secretary; (b) whenever notice is
required by the provisions of this Agreement to be given to the Selling
Stockholders, such notice shall be in writing or by telecopy addressed to the
Selling Stockholders c/o Lehman Brothers Holdings Inc., 3 World Financial
Center, 200 Vesey Street, New York, New York 10205, Attention: Alan H.
Washkowitz and Julie T. Katzman; and (c) whenever notice is required by the
provisions of this Agreement to be given to the several International Managers,
such notice shall be in writing or by telecopy addressed to you, in care of
Lehman Brothers International (Europe), One Broadgate, London EC2M 7HA, England,
Attention: Syndicate Department.
13. Information Furnished by International Managers. The Company and
-------------------------------------- ---------
the International Managers severally confirm that the statements set forth in
the last paragraph of the cover page with respect to the public offering of the
Shares and under the caption "Underwriting" (except the last paragraph thereof)
in any Preliminary Prospectus and in the Prospectuses are correct and constitute
the written information furnished by or on behalf of any International Manager
referred to in paragraph (b) of Section 2 hereof and in paragraphs (a), (b) and
(c) of Section 9 hereof.
14. Parties. This Agreement shall inure to the benefit of and be
--------
binding upon the several International Managers, the Company, the Selling
Stockholders and their respective successors. This Agreement and the terms and
provisions hereof are for the sole benefit of only those persons, except that
(a) the representations, warranties, indemnities and agreements of the Company
and the Selling Stockholders contained in this Agreement shall also be deemed to
be for the benefit of the person or persons, if any, who control within the
meaning of the Securities Act or
<PAGE>
37
the Exchange Act or the Rules and Regulations thereunder any International
Manager who offers or sells any Shares in accordance with the terms of the
Agreement Between U.S. Underwriters and International Managers and for the
benefit of any U.S. Underwriter (and controlling persons thereof) who offers or
sells any Shares in accordance with the terms of the Agreement Between U.S.
Underwriters and International Managers and (b) the indemnity agreement of the
International Managers contained in Section 9 hereof shall be deemed to be for
the benefit of directors of (i) the Company, officers of the Company who signed
the Registration Statement and any person controlling the Company within the
meaning of the Securities Act or the Exchange Act or the Rules and Regulations
thereunder and (ii) the Selling Stockholders, each partner thereof and any
person controlling any Selling Stockholder within the meaning of the Securities
Act or the Exchange Act or the Rules and Regulations thereunder. Nothing in
this Agreement shall be construed to give any person, other than the persons
referred to in this paragraph, any legal or equitable right, remedy or claim
under or in respect of this Agreement or any provision contained herein. The
term "successors," as used in this Agreement, shall not include any purchaser of
any of the Shares from any of the International Managers merely by reason of
such purchase.
15. Governing Law. This Agreement shall be governed by and construed
--------------
in accordance with the laws of the State of New York.
16. Counterparts. This Agreement may be signed in one or more
-------------
counterparts, each of which shall constitute an original and all of which
together shall constitute one and the same agreement.
Please confirm, by signing and returning to us two counterparts of
this Agreement, that you are acting on behalf of yourselves and the several
International Managers
<PAGE>
38
and that the foregoing correctly sets forth the Agreement among the Company, the
Selling Stockholders and the several International Managers.
Very truly yours,
LORAL CORPORATION,
By:
------------------------------
Name:
Title:
LEHMAN BROTHERS MERCHANT BANKING PORTFOLIO
PARTNERSHIP L.P., as Selling Stockholder
By: Lehman Brothers Merchant
Banking Partners, Inc.
By:
------------------------------
Name:
Title:
LEHMAN BROTHERS CAPITAL PARTNERS II, L.P., as
Selling Stockholder
By: Lehman Brothers II
Investment Inc.
By:
------------------------------
Name:
Title:
LEHMAN BROTHERS OFFSHORE INVESTMENT PARTNERSHIP
L.P., as Selling Stockholder
<PAGE>
39
By: Lehman Brothers Offshore
Partners Ltd.
By:
------------------------------
Name:
Title:
LEHMAN BROTHERS OFFSHORE INVESTMENT PARTNERSHIP -
JAPAN L.P., as Selling Stockholder
By: Lehman Brothers Offshore
Partners Ltd.
By:
------------------------------
Name:
Title:
Confirmed and accepted as of
the date first above mentioned:
LEHMAN BROTHERS INTERNATIONAL (EUROPE)
By:
---------------------------
Authorized Representative
<PAGE>
SCHEDULE I
International Underwriting Agreement dated June , 1995
Number of
Shares to Be
Selling Stockholder Sold
- ------------------- ------------
Lehman Brothers Merchant Banking
Portfolio Partnership L.P. ..........
Lehman Brothers Capital Partners II,
L.P. ................................
Lehman Brothers Offshore Investment
Partnership L.P. ....................
Lehman Brothers Offshore Investment
Partnership - Japan L.P. ............ --------------
Total................................. 660,000
=============
<PAGE>
SCHEDULE II
International Underwriting Agreement dated June , 1995
Number of
Shares to Be
International Manager Purchased
- --------------------- ------------
Lehman Brothers International (Europe).. ------------
Total................................... 660,000
============
<PAGE>
EXHIBIT 3.1
RESTATED CERTIFICATE OF INCORPORATION
OF
LORAL CORPORATION
UNDER SECTION 807
OF
THE BUSINESS CORPORATION LAW
We, the undersigned, Bernard L. Schwartz and Michael B. Targoff, being the
Chairman of the Board and Secretary, respectively, of LORAL CORPORATION, do
hereby certify:
1) The name of the corporation is LORAL CORPORATION. This Corporation was
originally formed under the name LORAL ELECTRONICS CORPORATION.
2) The Certificate of Incorporation of LORAL ELECTRONICS CORPORATION was
filed by the Department of State on February 24, 1948. A Certificate of
Amendment of the Certificate of Incorporation of Loral Corporation was filed on
October 18, 1993.
3) This Restated Certificate of Incorporation was authorized by the Board
of Directors.
4) The Certificate of Incorporation as amended to change the post office
address to which the Secretary of State shall mail copy of process against the
corporation is hereby restated as amended to read as herein set forth:
FIRST: The name of the Corporation is LORAL CORPORATION.
SECOND: The purposes for which said Corporation is to be formed are as
follows:
(a) To manufacture, assemble, install, buy, sell, design, patent, develop,
export, import, exchange, repair and in any and every other way deal
in radio, radio sets and receivers, television, television sets and
receivers, amplifiers, sound equipment of any kind or nature
whatsoever, devices, machinery, machine parts, tools, dies, engines,
motors, appliances and any equipment directly or indirectly related to
same and any parts or supplies of any of the above, whether
<PAGE>
made wholly or partly from metals or from any other material
whatsoever, whether operated by electricity or by any other power,
cause, or action.
(b) To acquire, hold, maintain and operate all real estate, plants,
machinery, warehouses, apparatus, equipment, franchises, licenses, and
permits and do all other things requisite to the prosecution of such
business.
(c) To buy, lease or otherwise acquire the good will, franchises, rights
and property of any corporation, person, firm, or association engaged
in the same or similar line of business, and to pay for the same in
cash, property, the stock or bonds of this company or otherwise, and
to hold or in any manner dispose of, the whole or any part of the
property so acquired; to conduct, carry on, operate, manage, control,
improve and develop the whole or any part of any business or property
so acquired, in the name of this Corporation, provided that such
business is one that may be carried on by a corporation organized
under the act under which this company is incorporated, and to
exercise all the powers necessary or convenient in and about the
conduct and management of such business.
(d) To sell or exchange all or any part of the property, assets, good will
and undertaking of the company, and to accept in payment or exchange
therefor, the stocks, bonds, or other securities of any other
corporation, either domestic or foreign.
(e) To borrow or raise money for the purpose of the company, to secure the
same and any interest therein, and for that purpose or any other
purpose, subject to the provisions and restrictions hereinafter set
forth, to mortgage and charge all or any part of the present or after-
acquired property-rights, or rights and franchises of the company, and
to issue notes, bonds, debentures and other evidences of indebtedness.
2
<PAGE>
(f) To use the surplus profits of said Corporation for the purchase of any
of the shares of its capital stock, provided, however, that the
capital stock shall not be reduced except in accordance with the
requirements of the statue.
(g) To do all and everything necessary, suitable, useful or proper for the
accomplishment of any of the purposes or the attainment of any of the
objects or the furtherance of any of the powers hereinbefore set
forth, as principal or agent, either alone or in association with
other corporations, firms or individuals, and to do every other act or
acts, thing or things incidental or appurtenant to, or growing out of,
or connected with, any of the aforesaid purposes, objects or powers,
or any part or parts thereof, and to do any such acts or things to the
same extent and as fully as natural persons might or could do in any
part of the world.
(h) To purchase, sell, lease, manufacture, deal in and deal with every
kind of goods, wares and merchandise and every kind of personal
property, including patents and patent rights, chattels, easements,
privileges and franchises which may lawfully be purchased, sold,
produced or dealt in by corporations under the statues of the State of
New York.
(i) To enter into, make, perform and carry out contracts of every
kind, which may be necessary for or incidental to the business of the
Corporation, with any person, firm, corporation, private, public or
municipal, body politic, under the government of the United States, or
any territory, district, protectorate, dependency or insular or other
possession or acquisition of the United States, or any foreign
government, so far as, and to the extent that the same may be done and
performed by a corporation organized under the Stock Corporation Law.
(j) This Corporation shall have the power to conduct its business in
all branches in the
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<PAGE>
State of New York or any other State of the United States and in all
foreign countries and generally to do all acts and things and to
exercise all the powers, now or hereafter authorized by law, necessary
to carry on the business of this Corporation or to promote any of the
objects for which this Corporation is formed.
(k) The objects and powers specified in any clause contained in this
Article, shall, except where otherwise expressed, be in no wise
limited or restricted by reference to or interference from the terms
of any other clause of this Article or any other Article of this
Certificate; but the objects and powers specified in each of the
clauses of this Article shall be regarded as independent objects,
purposes and powers.
(l) To acquire by purchase or otherwise hold, lease, own, improve,
sell, convey, exchange, mortgage and otherwise deal or trade in and
dispose of real property and any estate, interest or rights therein;
to lend money on bonds secured by mortgage on real and personal
property or otherwise; to erect, construct, alter, maintain and
improve houses and buildings of every description on any lands of the
Corporation or upon any other lands, and to re-build, alter and
improve existing houses and buildings thereon.
(m) The foregoing enumeration of specific powers shall not be held to
limit or restrict in any manner, the general powers of the company,
and the enjoyment thereof, as conferred by the Laws of the State of
New York upon corporations organized under the provisions of the act
under which this company is incorporated.
THIRD: The total number of shares which the Corporation shall have
authority to issue is 152,000,000 of which 150,000,000 shares shall be Common
Stock having a par value of Twenty-Five Cents ($.25) each, and 2,000,000 shares
4
<PAGE>
shall be Preferred Stock having a par value of One Dollar ($1.00) each.
The relative powers, preferences and rights and the qualifications,
limitations and restrictions on the shares of each class of stock are as
follows:
(1) The Preferred Stock may be issued in one or more series from time
to time with such distinctive serial designations as may be stated or expressed
in the resolutions providing for the issue of such stock from time to time
adopted by the Board of Directors; and in such resolution providing for the
issue of shares of each particular series, the Board of Directors is expressly
authorized to fix:
(a) the annual dividend rate of the particular series, if any, whether
the dividends shall be cumulative or non-cumulative and, if such dividends shall
be cumulative, the date from which they shall be cumulative;
(b) the redemption and liquidation prices for the particular series;
(c) the voting power, if any, for the particular series and the terms
and conditions under which such voting power may be exercised, provided that the
shares of all series having voting power shall not have more than one vote each;
(d) the obligation, if any, of the Corporation to retire shares of
such series pursuant to a sinking fund or fund of a similar nature or otherwise
and the terms and conditions of such obligation; and
(e) the terms and conditions, if any, upon which shares of such series
shall be convertible into, or exchangeable for, shares of stock of any other
class or classes, including the price or prices or the rate or rates
5
<PAGE>
of conversion or exchange and the terms of adjustment, if any.
(2) In case the stated dividends and the amounts payable on liquidation to
the holders of the Preferred Stock are not paid in full, the shares of all
series of such Preferred Stock shall share ratably in the payment of dividends,
including accumulations, if any, in accordance with the sums which would be
payable on said shares if all dividends were declared and paid in full, and in
any distribution of assets other than by way of dividends in accordance with the
sums which would be payable on such distribution if all sums payable were
discharged in full.
(3) The holders of the Preferred Stock shall be entitled to receive, when
and as declared by the Board of Directors, but only out of surplus legally
available for the payment of dividends, preferential dividends in cash at, but
not exceeding, the annual rate fixed for each particular series at the time of
the original authorization of the issue of the shares of the particular series,
payable quarter-yearly on the fifteenth day of January, April, July and October
in each year. The holders of the Preferred Stock shall not be entitled to
receive any dividends thereon other than the dividends referred to in this
subdivision (3).
(4) So long as any of the Preferred Stock remains outstanding, in no event
shall any dividend whatever, whether in cash, stock, or otherwise, be paid or
declared, or any distribution be made on the Common Stock, nor shall any shares
of the Common Stock be purchased, retired, or otherwise acquired for a
consideration by the Corporation (a) unless the full dividends on the Preferred
Stock for all past quarter-yearly dividend periods from the respective
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date or dates dividends became cumulative thereon, shall have been paid and the
full dividend thereon for the then current quarter-yearly dividend period shall
have been paid or declared and a sum sufficient for the payment thereof set
apart, (b) unless, if any time the Corporation is obligated to retire shares of
any series of Preferred Stock pursuant to a sinking fund or fund of a similar
nature, all arrears, if any, in respect of the retirement of the Preferred Stock
of all such series shall have been made good and (c) except out of surplus
legally available at the time for payment of such dividends or for the purchase
of such stock.
Subject to the foregoing provisions, and not otherwise, such dividends
(payable in cash, stock, or otherwise) as may be determined by the Board of
Directors may be declared and paid on the Common Stock from time to time out of
the remaining surplus of the Corporation, and the Preferred Stock shall not be
entitled to participate in any such dividend, whether payable in cash, stock, or
otherwise.
(5) The Corporation, at the option of the Board of Directors, may redeem
any one or more series at the time outstanding of the Preferred Stock, in whole
at any time or in part from time to time, upon notice duly given as hereinafter
specified, by paying therefor the applicable redemption price fixed at the time
of the original authorization of the issue of shares of such respective series
for the shares thereof, together with a sum, in the case of each share so to be
redeemed, computed at the annual dividend rate for the series of which the
particular share is a part, from the date on which dividends on such shares
became cumulative to the date fixed for such redemption, less the aggregate
amount of all dividends theretofore and on such redemption date paid thereon.
7
<PAGE>
Notice of every such redemption of the Preferred Stock shall be given by
publication at least once in each of two successive calendar weeks in a daily
newspaper printed in the English language and published and of general
circulation in the City of New York, New York, the first publication to be at
least thirty days prior to the date fixed for such redemption. At least thirty
days' previous notice of every such redemption shall also be mailed to the
holders of record of the shares to be redeemed at their respective addresses as
the same shall appear on the books of the Corporation, and if such notice has
been given as herein provided, the failure of any holder to receive such notice
shall not affect the validity of the proceedings for the redemption of any share
so to be redeemed.
In case of redemption of only part of any series of the Preferred Stock at
any time outstanding, the Corporation shall designate by lot the shares so to be
redeemed. Subject to the limitations and provisions herein contained, the Board
of Directors shall have full power and authority to prescribe the manner in
which the drawings by lot shall be conducted and the terms and conditions upon
which the Preferred Stock shall be deemed from time to time.
If such notice of redemption shall have been given as hereinbefore
provided, and if on or before the redemption date specified therein the funds
necessary for such redemption shall have been set aside by the Corporation,
separate and apart from its other funds, in trust for the pro rata benefit of
the holders of the shares so called for redemption, so as to be and continue to
be available therefor, then, notwithstanding that any certificate for shares so
called for redemption shall not have been surrendered for cancellation, all
shares of the Preferred
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<PAGE>
Stock so called for redemption shall no longer be deemed to be outstanding on
and after such redemption date, and all rights with respect to such shares shall
forthwith on such redemption date cease and terminate, except only the right of
the holders thereof to receive the amount payable on redemption thereof, without
interest, and the right to exercise, on or before the date fixed for redemption,
privileges of conversion or exchange, if any, not theretofore expiring.
Provided, however, in the alternative, that if such notice of redemption
shall have been duly given as hereinbefore provided or if the Corporation shall
have given to the bank or trust company hereinafter referred to irrevocable
authorization to give or complete such notice as hereinbefore provided, and if
prior to the redemption date specified therein the funds necessary for such
redemption shall have been deposited by the Corporation with a bank or trust
company in good standing, designated in such notice, organized under the laws of
the United States of America or of the State of New York, doing business in the
City of New York, New York, having a capital surplus and undivided profits
aggregating at least $5,000,000 according to its last published statement of
condition, in trust to be applied to the redemption of the shares so called for
redemption, then, notwithstanding that any certificate for shares so called for
redemption shall not have been surrendered for cancellation, from and after the
time of such deposit all shares of the Preferred Stock so called for redemption
shall no longer be deemed to be outstanding and all rights with respect to such
shares shall forthwith cease and terminate, except only the right of the holders
thereof to receive from such bank or trust company at any time after
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<PAGE>
the time of such deposit the funds so deposited, without interest, and the right
to exercise, on or before the date fixed for redemption, privileges of
conversion or exchange, if any, not theretofore expiring. Any funds so
deposited which shall not be required for such redemption because of the
exercise of any such right of conversion subsequent to the date of such deposit
shall be returned to the Corporation forthwith. Any interest accrued on any
funds so deposited shall be paid to the Corporation from time to time.
Any funds so set aside or deposited, as the case may be, and unclaimed at
the end of six years from such redemption date shall be released or repaid to
the Corporation, after which the holders of the shares so called for redemption
shall look only to the Corporation for payment thereof.
Shares of any series of Preferred Stock so redeemed may thereafter, in the
discretion of the Board of Directors, be reissued at any time or from time to
time to the extent and in any manner not or hereafter permitted by law, except
as may be otherwise provided in the resolution or resolutions of the Board of
Directors providing for the issue of shares of any such series.
(6) In the event of a liquidation, dissolution or winding up the affairs of
the Corporation, whether voluntary or involuntary, then, before any distribution
or payment shall be made to the holders of the Common Stock, the holders of each
series of the Preferred Stock shall be entitled to be paid in cash the
applicable liquidation price per share fixed at the time of the original
authorization of the issue of shares of each such respective series and, in the
case of each share of the Preferred Stock having
10
<PAGE>
cumulative dividend rights, an amount, computed at the annual dividend rate for
the series of which the particular share is a part, from the date on which
dividends on such share became cumulative to the date fixed for such
distribution or payment, less the aggregate amount of all dividends theretofore
and on such distribution or payment date paid thereon. If such payment shall
have been made in full to the holders of the Preferred Stock, the remaining
assets and funds of the Corporation shall be distributed among the holders of
the Common Stock according to their respective shares.
FOURTH: No holder of stock of the Corporation shall have any right as such
holder to subscribe for or acquire from the Corporation any stock, whether such
stock be a part of the presently authorized stock or a part of any future
increase thereof, or any bonds, notes, debentures, or other securities
convertible into stock of the Corporation which the Corporation may from time to
time issue; and the Corporation shall have the right from time to time, without
offering the same to the holders of such stock of any class then outstanding, to
issue and sell shares of its stock of any class or any such bonds, notes,
debentures or other securities convertible into stock to such person or persons
as its Board of Directors from time to time shall determine. As used in this
section, the expression "securities convertible into stock" shall be deemed to
include all bonds, notes, debentures or other evidence of indebtedness to which
are attached, or with which are issued, warrants or other instruments evidencing
the right to purchase or otherwise acquire shares of stock of the Corporation.
FIFTH: The office of the Corporation is to be located in the City of New
York, County of New York, State of New York.
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<PAGE>
SIXTH: The duration of the Corporation shall be perpetual.
SEVENTH: The number of its Directors shall be as set forth in the By-Laws
of this Corporation but shall at no time be less than 3 nor more than 11. At the
1985 annual meeting of stockholders, the directors shall be divided into three
classes, as nearly equal in number as possible, with the term of office of the
first class to expire at the 1986 annual meeting of stockholders, the term of
office of the second class to expire at the 1987 annual meeting of stockholders,
and the term of office of the third class to expire at the 1988 annual meeting
of stockholders. Increases or decreases in the total number of authorized
directors shall be allocated among the classes of directors, so as to retain the
number of directors in each class as nearly equal in number as possible. At each
annual meeting of stockholders following such initial classification and
election, directors elected to succeed those directors whose terms expire shall
be elected for a term of office to expire at the third succeeding annual meeting
of stockholders after their election; directors elected to fill a vacancy shall
be elected for a term equal to the remaining term of office of the class to
which such directors shall have been elected.
Subject to the rights of then-outstanding holders of any class or series of
the capital stock of the Corporation entitled to vote generally in the election
of directors (hereinafter in this Article SEVENTH and paragraph (1)(a) of
Article NINTH of this Certificate of Incorporation such stock is referred to as
the "Voting Stock"), newly created directorships resulting from any increase in
the authorized number of directors or any vacancies in the Board of Directors
resulting from death, resignation, retirement,
12
<PAGE>
disqualification, removal from office or other cause may be filled only by a
majority vote of the directors then in office, though less than a quorum, and
directors so chosen shall hold office for a term expiring at the next regular
annual meeting of stockholders at which directors are to be elected. No
decrease in the number of authorized directors constituting the entire Board of
Directors shall shorten the term of any incumbent director.
Subject to the rights of the holders of any class or series of the Voting
Stock then-outstanding, any director, or the entire Board of Directors, may be
removed from office at any time, but only for cause and only by resolution
adopted by the directors or by the affirmative vote of the holders of at least
80 percent of the voting power of all of the then-outstanding shares of the
Voting Stock, voting together as a single class. Notwithstanding any other
provisions of this Certificate of Incorporation or any provision of law which
might otherwise permit a lesser vote, but not in derogation of any special vote
of the holders of any particular class or series of the Voting Stock required by
law, this Certificate of Incorporation, of any designation of the rights, powers
and preferences of any class or series of Preferred Stock made pursuant to
Article THIRD of this Certificate of Incorporation ("Preferred Stock
Designation"), the affirmative vote of the holders of at least 80 percent of the
voting power of all of the then-outstanding shares of Voting Stock, voting
together as a single class, shall be required to alter, amend or repeal this
Article SEVENTH, unless such alteration, amendment or repeal has been first
approved by a resolution adopted by the Board of Directors.
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<PAGE>
EIGHTH: The Secretary of State of the State of New York is hereby
designated as the agent of the Corporation upon whom process in any action or
proceeding against it may be served, and the address to which the Secretary of
State shall mail a copy of such process served upon him is 600 Third Avenue, New
York, New York 10016.
NINTH: The following provisions are inserted for the regulation of the
business and conduct of the affairs of the Corporation and it is expressly
provided that they are intended to be in furtherance and not in limitation or
exclusion of the powers conferred by statute:
(1) The Board of Directors of the Corporation shall have power among other
things:
(a) To make, alter, amend and repeal the By-Laws of this Corporation,
subject to the power of the holders of the Voting Stock to alter,
amend or repeal the By-Laws; provided, however, that
notwithstanding any other provisions of this Certificate of
Incorporation or any provision of law which might otherwise permit
a lesser vote or no vote, but in addition of any affirmative vote
of the holders of any particular class or series of the capital
stock required by law, this Certificate of Incorporation or any
Preferred Stock Designation, the affirmative vote of the holders
of at least 80 percent of the voting power of all of the then-
outstanding shares of the Voting Stock, voting together as a
single class, shall be required to (i) alter, amend or repeal any
provision of the By-Laws which is to the same effect as Article
SEVENTH of this Certificate of Incorporation, or which establishes
the manner in which a special meeting of the stockholders of this
Corporation may
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<PAGE>
be called, or which prescribes the manner in which the By-Laws may
be amended, or (ii) alter, amend or repeal any provision of this
proviso to this paragraph (1)(a) of Article NINTH, unless such
alteration, amendment or repeal has been first approved by the
Board of Directors.
(b) From time to time to determine whether and to what extent and at
what times and places and under what conditions and regulations
the accounts and books of the Corporation (other than the stock
book), or any of them, shall be open to the inspection of the
stockholders, and no stockholder shall have any right, except as
conferred by statute, to inspect any account, book or document of
the Corporation unless expressly so authorized by resolution of
the Board of Directors or the stockholders.
(c) From time to time to fix and determine and to vary the amount of
the working capital of the Corporation, to direct and determine
whether any, and if any, what part, of the surplus or net profits
of the Corporation shall be declared in dividends and paid to the
stockholders, and to set apart any of the funds of the Corporation
otherwise available for dividends as a reserve or reserves for any
proper purpose and to abolish any such reserve in the manner in
which it was created.
(d) By resolution passed by a majority of the whole Board of
Directors, to designate three or more of its members to constitute
an Executive Committee, which, to the extent provided in said
resolution or in the By-Laws of the Corporation, shall have and
may exercise such of the powers of the Board of Directors in the
management of the business and affairs of the Corporation as may
be lawfully delegated.
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<PAGE>
(2) In the absence of fraud, no contract or other transaction between the
Corporation and any other corporation and no act of the Corporation shall in any
way be invalidated or otherwise affected by the fact that any of the Directors
of the Corporation are pecuniarily or otherwise interested in, or are directors
or officers of, such other corporation. Any Director of the Corporation,
individually, or any firm or association of which any Director may be a member,
may be a party to, or may be pecuniarily or otherwise interested in any contract
or transaction of the Corporation, provided that the fact that he, individually,
or such firm or association is so interested shall be disclosed or shall have
been known to the Board of Directors, or such members thereof as shall be
present at any meeting of the Board of Directors at which action upon any such
contract or transaction shall be taken; and any Director of the Corporation who
is also a director or officer of such other corporation, or who is so
interested, may be counted in determining the existence of a quorum at any
meeting of the Board of Directors or of any committee of the Corporation which
is authorizing any such contract or transaction, and may vote thereat to
authorize any such contract or transaction with like force and effect as if he
were not such director or officer of such other corporation or not so
interested. Any contract, transaction or act of the Corporation or of the
Directors or of any committee, which shall be ratified by a majority of a quorum
of the stockholders of the Corporation at any annual meeting, or at any special
meeting called for such purpose, shall, in so far as permitted by law, be as
valid and as binding as though ratified by every stockholder of the Corporation.
16
<PAGE>
(3) Any person made a party to any action, suit or proceeding by reason of
the fact that he, his testator or intestate, is or was a Director, officer or
employee of the Corporation or of any corporation for which he served as such at
the request of the Corporation, shall be indemnified by the Corporation against
the reasonable expenses, including attorneys' fees, actually and necessarily
incurred by him in connection with the defense of such action, suit or
proceeding, or in connection with any appeal therein, except in relation to
matters as to which it shall be adjudged in such action, suit or proceeding that
such officer, Director or employee is liable for negligence or misconduct in the
performance of his duties. Such right of indemnification shall not be deemed
exclusive of any other rights to which such Director, officer or employee may be
entitled apart herefrom. Any amount payable by way of indemnity, whether the
action, suit or proceeding reaches final judgment, or is settled with court
approval before final judgment, shall be determined and paid in accordance with
the then applicable provisions of the statues of the State of New York;
provided, however, that if such amount is paid otherwise than pursuant to court
order or action by the stockholders, the Corporation shall within eighteen
months from the date of such payment mail to its stockholders of record at the
time entitled to vote for the election of Directors a statement specifying the
persons paid, the amounts of the payments and the final disposition of the
litigation.
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IN WITNESS WHEREOF, we have signed this Restated Certificate of
Incorporation on the 30th day of May, 1995, and we affirm the contents therein
as true under penalties of perjury.
/s/ Bernard L. Schwartz /s/ Michael B. Targoff
- ------------------------- ------------------------
Bernard L. Schwartz Michael B. Targoff
Chairman Secretary
18
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EXHIBIT 5
[WF&G LETTERHEAD]
May 31, 1995
Loral Corporation
600 Third Avenue
New York, New York 10016
Re: Registration Statement on Form S-3 with
respect to 3,314,960 Shares of Common
Stock of Loral Corporation
---------------------------------------
Dear Sirs:
We are acting as counsel for Loral Corporation (the "Company") in connection
with the registration under the Securities Act of 1933, as amended, and pursuant
to the Company's Registration Statement on Form S-3, to be filed with the
Securities and Exchange Commission on or about May 31, 1995 (the "Registration
Statement"), covering a proposed sale by certain stockholders (the "Selling
Stockholders") of a total of 3,314,960 shares of the Company's Common Stock,
$0.25 par value per share (the "Common Stock"). The shares of Common Stock
covered by the Registration Statement are to be sold by the Selling Stockholders
to the U.S. Underwriter and the International Manager (each such term as defined
in the Registration Statement) pursuant to a U.S. Underwriting Agreement and an
International Underwriting Agreement, respectively, for resale as set forth more
fully in the Registration Statement (all such shares being hereinafter referred
to as the "Shares").
We have examined and are familiar with originals or copies certified or
otherwise identified to our satisfaction of such documents, corporate records
and other instruments relating to the incorporation of the Company and to the
authorization and issuance of the Common Stock, and made such investigations of
law as we have deemed necessary and advisable.
<PAGE>
Loral Corporation
May 31, 1995
Page 2
Based upon the foregoing and having regard for such legal questions as we have
deemed relevant, it is our opinion that the Shares have been duly authorized and
are validly issued, fully paid and nonassessable. No personal liability will
attach to the holders of the Shares under the laws of the State of New York
(wherein the Company is incorporated and has its principal place of business).
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and consent to the reference to our firm under the
caption "Legal Opinions" in the Registration Statement and in the Prospectus
constituting a part thereof.
We are members of the Bar of the State of New York and do not purport to be
experts in, or to render any opinions with respect to, the laws of any state or
jurisdiction other than the laws of the State of New York and the federal laws
of the United States of America.
Very truly yours,
WILLKIE FARR & GALLAGHER
<PAGE>
EXHIBIT 23.1
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in the registration statement of
Loral Corporation and Subsidiaries on Form S-3 of our report dated May 11, 1995,
which includes an explanatory paragraph regarding changes in 1993 in methods of
accounting for income taxes and postretirement benefits other than pensions as
discussed in Notes 6 and 9 to the consolidated financial statements, on our
audits of the consolidated financial statements of Loral Corporation and
Subsidiaries as of March 31, 1995 and 1994, and for the years ended March 31,
1995, 1994 and 1993, which report is incorporated by reference in this
registration statement on Form S-3. We also consent to the reference to our
firm under the caption "Experts".
/s/ Coopers & Lybrand L.L.P.
1301 Avenue of the Americas
New York, NY 10019
May 30, 1995
<PAGE>
EXHIBIT 23.2
Consent of Independent Auditors
We consent to the reference to our firm under the caption "Experts" in the
Registration Statement (Form S-3) and the related Prospectus of Loral
Corporation for the registration of 3,314,960 shares of its common stock and to
the incorporation by reference therein of our report dated January 25, 1995,
with respect to the combined financial statements of Unisys Defense Systems (a
unit of Unisys Corporation), which is included in the Current Report on Form 8-K
of Loral Corporation filed May 22, 1995 with the Securities and Exchange
Commission.
/s/ Ernst & Young LLP
Philadelphia, Pennsylvania
May 30, 1995
<PAGE>
EXHIBIT 24
POWER OF ATTORNEY
-----------------
The undersigned, individually and in the capacity relative to Loral Corporation,
a New York corporation, stated below, hereby appoints Michael P. DeBlasio,
Robert V. LaPenta, Nicholas C. Moren, Michael B. Targoff and Eric J. Zahler, and
each of them acting individually, to be his Attorney-in-Fact with full power of
substitution to act in his name and on his behalf to sign and to file with the
Securities and Exchange Commission this Registration Statement on Form S-3 in
connection with the public offering of up to 3,500,000 shares of Loral
Corporation Common Stock, par value $.25, including one or more amendments,
including post-effective amendments, to such Registration Statement, which
amendments may make such changes as such person deems appropriate, and to
execute and deliver any agreements, instruments, certificates or other documents
which such person shall deem necessary or proper in connection with the filing
of such Registration Statement and generally to act for and in the name of the
undersigned with respect to such filing as fully as could the undersigned if
then personally present and acting.
IN WITNESS WHEREOF, the undersigned has executed this Power-of-Attorney on the
date set opposite his respective name.
/s/ Bernard Schwartz Chairman of the Board, May 30, 1995
- -------------------------- Chief Executive Officer
Bernard L. Schwartz and Director
/s/ Frank C. Lanza
- --------------------------
Frank C. Lanza President and Director May 30, 1995
/s/ Howard Gittis
- --------------------------
Howard Gittis Director May 30, 1995
/s/ Robert B. Hodes
- --------------------------
Robert B. Hodes Director May 30, 1995
/s/ Gershon Kekst
- --------------------------
Gershon Kekst Director May 30, 1995
/s/ Charles Lazarus
- --------------------------
Charles Lazarus Director May 30, 1995
/s/ Allen Shinn
- --------------------------
Allen Shinn Director May 30, 1995
/s/ Thomas J. Stanton, Jr.
- --------------------------
Thomas J. Stanton, Jr. Director May 30, 1995
/s/ Daniel Yankelovich
- --------------------------
Daniel Yankelovich Director May 30, 1995
