Exhibit 10(j)
SUPPORT AGREEMENT
DATED APRIL 28, 1994
BETWEEN
ITT CORPORATION AND ITT FINANCIAL CORPORATION
This agreement entered into as of this 28th day of April, 1994, by and
between ITT CORPORATION, a Delaware corporation ("ITT"), and ITT FINANCIAL
CORPORATION, a Delaware corporation ("Financial"),
WITNESSETH:
WHEREAS, ITT is the owner of all of the issued and outstanding voting
capital stock of Financial;
WHEREAS, Financial regularly borrows funds in the public and private
capital markets to conduct its business;
WHEREAS, ITT is willing to provide certain support to Financial in order to
assure the ability of Financial to engage in financings at favorable terms; and
WHEREAS, the execution and delivery of this Agreement has been duly
authorized by ITT and Financial and this Agreement will constitute the legal,
valid and binding obligations of the parties thereto in accordance with its
terms, subject, as to enforcement, to bankruptcy, insolvency, reorganization
and other laws of general applicability relating to or affecting creditors'
rights and to general equity principles;
NOW THEREFORE, in consideration of the provisions contained herein, the
parties hereto agree as follows:
1. Ownership. ITT or one or more of its direct or indirect wholly-owned
subsidiaries or a combination thereof will continue to own at least a majority
of the shares of capital stock of Financial having voting power for the
election of directors, and ITT will not create or permit the creation of any
mortgage, pledge or other lien on any of such shares so owned.
2. Maintenance of Debt to Equity Ratio. ITT will assure that the debt to
equity ratio (as determined on a consolidated basis - excluding depository
institutions - and in accordance with generally accepted accounting principles)
for Financial, as determined from Financial's balance sheet as at the end of
each calendar quarter, does not exceed 6.75 to 1.
3. Commitment to Make Loans. If Financial should at any time lack
sufficient cash, other liquid assets or credit facilities to meet an obligation
to pay principal of, or premium or interest on any commercial paper or other
short-term debt for borrowed money of Financial on a timely basis, then ITT
will lend to Financial on a subordinated basis up to $300 million in cash which
Financial may use only for the purpose of meeting any such payment obligation.
Any such loan by ITT to Financial will bear interest at a fluctuating interest
rate per annum equal to the announced prime commercial lending rate of The
Chase Manhattan Bank, N.A. and will be repayable on demand at any time after
the business day following the 29th day after such loan was made to Financial,
except that no repayment of any such loan will be made during a period of
default in the payment of any unsubordinated indebtedness for borrowed money of
Financial. The aggregate principal amount of loans to Financial hereunder at
any one time outstanding is limited to $300 million.
4. Commercial Paper Coverage. ITT will take all reasonable actions
necessary to cause and assure that Financial at all times maintains unused
committed bank lines of credit to back up its commercial paper borrowings in
an amount not less than such commercial paper borrowings.
5. Term. This Agreement shall remain in full force and effect while any
debt for borrowed money of Financial is outstanding unless terminated by
either party. Each party reserves the right to terminate its obligations
hereunder by notice to the other party delivered not less than 60 nor more
than 90 days prior to such termination, but in no event shall such termination
be earlier than July 31, 1995. In no event shall this Agreement be terminated
if such termination would result in the downgrading of ITT Financial
Corporation's outstanding debt by any one of the agencies engaged by the
Company to rate its debt.
6. Notices. Any notice or other communication required or contemplated by
this Agreement shall be in writing and delivered as follows:
If to ITT: ITT Corporation
1330 Avenue of the Americas
New York, NY 10019-5490
Attention: Treasurer
If to Financial: ITT Financial Corporation
645 Maryville Centre Drive
St. Louis, MO 63141-5832
Attention: Treasurer
7. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York.
IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed as of the date set forth above.
ITT CORPORATION
By:A.N. Reese
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Ann N. Reese
ITT FINANCIAL CORPORATION
By:R.H. Schumacker
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Richard H. Schumacker