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EXHIBIT 2.1
AGREEMENT AND PLAN OF REORGANIZATION
AMONG
PARENT CORPORATION,
MARTIN MARIETTA CORPORATION
AND
LOCKHEED CORPORATION
DATED AS OF AUGUST 29, 1994
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TABLE OF CONTENTS
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ARTICLE I
THE MERGERS
SECTION 1.1 Charter and Bylaws of Parent.......................................... I-1
SECTION 1.2 Atlantic Sub Merger................................................... I-1
SECTION 1.3 Pacific Sub Merger.................................................... I-2
SECTION 1.4 Exchange of Certificates.............................................. I-3
SECTION 1.5 Cancellation of Parent Stock.......................................... I-3
ARTICLE II
STOCKHOLDER APPROVAL
ARTICLE III
BOARDS OF DIRECTORS OF PARENT, MARTIN MARIETTA
AND LOCKHEED; OFFICERS OF MARTIN MARIETTA AND LOCKHEED
SECTION 3.1 Parent Board of Directors............................................. I-4
SECTION 3.2 Martin Marietta Board of Directors; Officers.......................... I-4
SECTION 3.3 Lockheed Board of Directors; Officers................................. I-4
SECTION 3.4 Parent Dividend....................................................... I-4
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF MARTIN MARIETTA
SECTION 4.1 Organization, Qualification, Etc. .................................... I-5
SECTION 4.2 Capital Stock......................................................... I-5
SECTION 4.3 Corporate Authority Relative to this Agreement; No Violation.......... I-6
SECTION 4.4 Reports and Financial Statements...................................... I-6
SECTION 4.5 No Undisclosed Liabilities............................................ I-7
SECTION 4.6 No Violation of Law................................................... I-7
SECTION 4.7 Environmental Laws and Regulations.................................... I-7
SECTION 4.8 No Undisclosed Employee Benefit Plan Liabilities...................... I-7
SECTION 4.9 Absence of Certain Changes or Events.................................. I-8
SECTION 4.10 Investigations; Litigation............................................ I-8
SECTION 4.11 Joint Proxy Statement; Registration Statement; Other Information...... I-8
SECTION 4.12 Accounting Matters.................................................... I-8
SECTION 4.13 Martin Marietta Rights Plan........................................... I-8
SECTION 4.14 Ownership of Lockheed Stock........................................... I-9
SECTION 4.15 Tax Matters........................................................... I-9
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF LOCKHEED
SECTION 5.1 Organization, Qualification, Etc. .................................... I-9
SECTION 5.2 Capital Stock......................................................... I-10
SECTION 5.3 Corporate Authority Relative to this Agreement; No Violation.......... I-10
SECTION 5.4 Reports and Financial Statements...................................... I-11
SECTION 5.5 No Undisclosed Liabilities............................................ I-11
SECTION 5.6 No Violation of Law................................................... I-11
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SECTION 5.7 Environmental Laws and Regulations.................................... I-11
SECTION 5.8 No Undisclosed Employee Benefit Plan Liabilities...................... I-12
SECTION 5.9 Absence of Certain Changes or Events.................................. I-12
SECTION 5.10 Investigations; Litigation............................................ I-12
SECTION 5.11 Joint Proxy Statement; Registration Statement; Other Information...... I-12
SECTION 5.12 Accounting Matters.................................................... I-12
SECTION 5.13 Lockheed Rights Plan.................................................. I-12
SECTION 5.14 Ownership of Martin Marietta Stock.................................... I-13
SECTION 5.15 Tax Matters........................................................... I-13
ARTICLE VI
ADDITIONAL COVENANTS AND AGREEMENTS
SECTION 6.1 Conduct of Business by Martin Marietta or Lockheed.................... I-13
SECTION 6.2 Investigation......................................................... I-15
SECTION 6.3 Cooperation........................................................... I-15
SECTION 6.4 Affiliate Agreements.................................................. I-16
SECTION 6.5 Employee Stock Options, Incentive and Benefit Plans................... I-16
SECTION 6.6 Further Assurances.................................................... I-17
SECTION 6.7 No Solicitation....................................................... I-17
SECTION 6.8 Public Announcements.................................................. I-18
SECTION 6.9 Agreements with Respect to Martin Marietta Common Stock and Lockheed
Common Stock........................................................ I-18
SECTION 6.10 Indemnification and Insurance......................................... I-18
SECTION 6.11 Accountants' "Comfort" Letters........................................ I-18
SECTION 6.12 Additional Reports.................................................... I-18
ARTICLE VII
CONDITIONS TO THE MERGERS
SECTION 7.1 Conditions to Both Mergers............................................ I-19
SECTION 7.2 Conditions to Obligations of Martin Marietta to Effect the Atlantic
Sub Merger.......................................................... I-19
SECTION 7.3 Conditions to Obligations of Lockheed to Effect the Pacific Sub
Merger.............................................................. I-20
ARTICLE VIII
TERMINATION, WAIVER, AMENDMENT AND CLOSING
SECTION 8.1 Termination or Abandonment............................................ I-20
SECTION 8.2 Termination Fee....................................................... I-20
SECTION 8.3 Expense Reimbursement................................................. I-21
SECTION 8.4 Amendment or Supplement............................................... I-21
SECTION 8.5 Extension of Time, Waiver, Etc. ...................................... I-21
SECTION 8.6 Closing............................................................... I-21
ARTICLE IX
MISCELLANEOUS
SECTION 9.1 No Survival of Representations and Warranties......................... I-22
SECTION 9.2 Expenses.............................................................. I-22
SECTION 9.3 Counterparts.......................................................... I-22
SECTION 9.4 Governing Law......................................................... I-22
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SECTION 9.5 Notices............................................................... I-22
SECTION 9.6 Miscellaneous......................................................... I-22
SECTION 9.7 Subsidiaries; Significant Subsidiaries................................ I-23
SECTION 9.8 Finders or Brokers.................................................... I-23
Exhibit A -- Charter of Parent Corporation
Exhibit B -- Bylaws of Parent Corporation
Exhibit C -- Plan and Agreement of Merger relating to Martin Marietta
Exhibit D -- Plan and Agreement of Merger relating to Lockheed
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AGREEMENT AND PLAN OF REORGANIZATION
AMONG
PARENT CORPORATION,
MARTIN MARIETTA CORPORATION
AND
LOCKHEED CORPORATION
THIS AGREEMENT AND PLAN OF REORGANIZATION, dated as of August 29, 1994
(this "Agreement"), is among Parent Corporation ("Parent"), Martin Marietta
Corporation ("Martin Marietta") and Lockheed Corporation ("Lockheed").
WHEREAS, Martin Marietta is a corporation duly organized and existing under
the laws of the State of Maryland and Lockheed is a corporation duly organized
and existing under the laws of the State of Delaware; and
WHEREAS, Parent is a corporation duly organized under the laws of the State
of Maryland, with Martin Marietta and Lockheed each owning one-half of the
outstanding capital stock of Parent; and
WHEREAS, the Boards of Directors of Martin Marietta and Lockheed deem it
advisable and in the best interest of their respective stockholders that each
corporation become a subsidiary of Parent pursuant to the mergers hereafter
provided for, and desire to make certain representations, warranties and
agreements in connection with such mergers;
NOW, THEREFORE, in consideration of the mutual agreements, provisions and
covenants contained in this Agreement, the parties hereby agree as follows:
ARTICLE I
THE MERGERS
SECTION 1.1 Charter and Bylaws of Parent. The Charter and Bylaws of
Parent shall be amended prior to the Merger Date (as hereinafter defined) to be
in substantially the form of Exhibits A and B hereto, respectively, and the name
of Parent shall be changed to Lockheed Martin Corporation. From the date hereof
until the Merger Date, Martin Marietta and Lockheed shall consult with each
other prior to causing or permitting Parent to take any action and neither shall
cause or permit Parent to take any action inconsistent with the provisions of
this Agreement without the written consent of the other.
SECTION 1.2 Atlantic Sub Merger. (a) Martin Marietta and Lockheed will
cause Parent to form a wholly owned subsidiary named Atlantic Sub, Inc.
("Atlantic Sub") under the laws of the State of Maryland. Atlantic Sub will be
formed solely to facilitate the Atlantic Sub Merger referred to below and will
conduct no business or activity other than in connection with the Atlantic Sub
Merger. Martin Marietta and Lockheed will cause Parent to cause Atlantic Sub to
execute and deliver, and Martin Marietta agrees to execute and deliver and to
submit to its stockholders for approval, together with this Agreement in
accordance with Article II, an Agreement and Plan of Merger (the "Atlantic Sub
Merger Agreement") in substantially the form attached hereto as Exhibit C,
providing for the merger of Atlantic Sub with and into Martin Marietta (the
"Atlantic Sub Merger"). Martin Marietta shall be the surviving corporation in
the Atlantic Sub Merger and as a result thereof shall become a wholly owned
subsidiary of Parent.
(b) Pursuant to the Atlantic Sub Merger:
(i) each share of Martin Marietta Common Stock (as hereinafter
defined) outstanding immediately prior to the effective time of the
Atlantic Sub Merger, other than any shares of Martin Marietta Common Stock
owned by Lockheed or any Subsidiary (as hereinafter defined) of Lockheed,
shall be
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converted into and become one share of common stock, par value $1.00 per
share, of Parent ("Parent Common Stock");
(ii) each share of Martin Marietta Preferred Stock (as hereinafter
defined) outstanding immediately prior to the effective time of the
Atlantic Sub Merger, other than any shares of Martin Marietta Preferred
Stock owned by Lockheed or any Subsidiary of Lockheed, shall be converted
into and become one share of Series A Preferred Stock, par value $1.00 per
share, of Parent ("Parent Preferred Stock"); and
(iii) each share of Martin Marietta Common Stock and Martin Marietta
Preferred Stock owned by Lockheed or any Subsidiary of Lockheed shall be
cancelled and cease to exist immediately upon the effective time of the
Atlantic Sub Merger without any payment being made in respect thereof.
(c) The parties will take such action as may be necessary to cause Parent
to reserve sufficient shares of Parent Common Stock following the Mergers (as
hereinafter defined) to permit conversion of the Parent Preferred Stock and
delivery of shares of Parent Common Stock upon conversion thereof following the
Atlantic Sub Merger. Subject to the terms and conditions of this Agreement,
Martin Marietta shall use its reasonable efforts to cause the Atlantic Sub
Merger to be consummated in accordance with the terms of the Atlantic Sub Merger
Agreement. Martin Marietta and Lockheed will cause Parent to execute a formal
written consent under Section 2-505 of the Maryland General Corporation Law (the
"Maryland Statute"), as the sole stockholder of Atlantic Sub, to the execution,
delivery and performance of the Atlantic Sub Merger Agreement by Atlantic Sub.
SECTION 1.3 Pacific Sub Merger. (a) Lockheed and Martin Marietta will
cause Parent to form a wholly owned subsidiary named Pacific Sub, Inc. ("Pacific
Sub") under the laws of the State of Delaware. Pacific Sub will be formed solely
to facilitate the Pacific Sub Merger referred to below and will conduct no
business or activity other than in connection with the Pacific Sub Merger.
Lockheed and Martin Marietta will cause Parent to cause Pacific Sub to execute
and deliver, and, subject to the terms and conditions of this Agreement,
Lockheed agrees to execute and deliver and to submit to its stockholders for
adoption and approval, together with this Agreement in accordance with Article
II, an Agreement and Plan of Merger (the "Pacific Sub Merger Agreement") in
substantially the form attached hereto as Exhibit D, providing for the merger of
Pacific Sub with and into Lockheed (the "Pacific Sub Merger"). Lockheed shall be
the surviving corporation in the Pacific Sub Merger and as a result thereof
shall become a wholly owned subsidiary of Parent.
(b) Pursuant to the Pacific Sub Merger:
(i) each share of Lockheed Common Stock (as hereinafter defined)
outstanding immediately prior to the effective time of the Pacific Sub
Merger, other than any shares of Lockheed Common Stock owned by Martin
Marietta or any Subsidiary of Martin Marietta or held in the treasury of
Lockheed, shall be converted into and become the right to receive 1.63
shares of Parent Common Stock; and
(ii) each share of Lockheed Common Stock owned by Martin Marietta or
any Subsidiary of Martin Marietta or held in the treasury of Lockheed shall
be cancelled and cease to exist immediately upon the effective time of the
Pacific Sub Merger without any payment being made in respect thereof.
Notwithstanding the foregoing, no fractional shares of Parent Common Stock will
be issued as a result of the Pacific Sub Merger. In lieu of the issuance of
fractional shares, cash payments will be made to holders of Lockheed Common
Stock in respect of any fractional share that would otherwise be issuable in an
amount equal to such fractional part of a share of Parent Common Stock
multiplied by the closing price of a share of Parent Common Stock on the New
York Stock Exchange (the "NYSE") on the last business day preceding the Merger
Date if such stock is then being traded, including without limitation trading on
a "when issued" basis, and otherwise shall be the closing price on the first
business day that such stock is traded. No such holder shall be entitled to
dividends, voting rights, or any other stockholder right in respect of any
fractional share. For this purpose, shares held of record by any particular
stockholder of Lockheed and represented by two or more certificates may be
aggregated.
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(c) Subject to the terms and conditions of this Agreement, Lockheed shall
use its reasonable efforts to cause the Pacific Sub Merger to be consummated in
accordance with the terms of the Pacific Sub Merger Agreement. Lockheed and
Martin Marietta will cause Parent to execute a formal written consent under
Section 228 of the Delaware General Corporation Law (the "Delaware Statute"), as
the sole stockholder of Pacific Sub, to the execution, delivery and performance
of the Pacific Sub Merger Agreement by Pacific Sub.
SECTION 1.4 Exchange of Certificates. Except as set forth above, from and
after the Merger Date, each holder of a certificate which immediately prior to
the Merger Date represented outstanding shares of Martin Marietta Common Stock,
Lockheed Common Stock or Martin Marietta Preferred Stock shall be entitled to
receive in exchange therefor, upon surrender thereof to an exchange agent to be
selected by the parties, a certificate or certificates representing the number
of shares of Parent Common Stock or Parent Preferred Stock into which such
holder's shares of Martin Marietta Common Stock, Lockheed Common Stock or Martin
Marietta Preferred Stock were converted. No holder of a certificate or
certificates which immediately prior to the Merger Date represented shares of
Martin Marietta Common Stock, Lockheed Common Stock or Martin Marietta Preferred
Stock shall be entitled to receive any dividend or other distribution from
Parent until surrender of such holder's certificate or certificates for a
certificate or certificates representing shares of Parent Common Stock (in the
case of holders of Lockheed Common Stock or Martin Marietta Common Stock) or
Parent Preferred Stock (in the case of holders of Martin Marietta Preferred
Stock). Upon such surrender, there shall be paid to the holder the amount of any
dividends or other distributions (without interest) which theretofore became
payable, but which were not paid by reason of the foregoing, with respect to the
number of whole shares of Parent Common Stock or Parent Preferred Stock, as the
case may be, represented by the certificates issued upon such surrender. From
and after the Merger Date, Parent shall, however, be entitled to treat such
certificates for shares of Martin Marietta Common Stock, Lockheed Common Stock
or Martin Marietta Preferred Stock which have not yet been surrendered for
exchange as evidencing the ownership of the number of shares of Parent Common
Stock or Parent Preferred Stock, as the case may be, into which the shares of
Martin Marietta Common Stock, Lockheed Common Stock or Martin Marietta Preferred
Stock represented by such certificates shall have been converted,
notwithstanding any failure to surrender such certificates. If any certificate
for shares of Parent Common Stock or Parent Preferred Stock, as the case may be,
is to be issued in a name other than that in which the certificate for shares of
Martin Marietta Common Stock, Lockheed Common Stock or Martin Marietta Preferred
Stock surrendered in exchange therefor is registered, it shall be a condition of
such issuance that the person requesting such issuance shall pay any transfer or
other tax required by reason of the issuance of certificates for such shares of
Parent Common Stock or Parent Preferred Stock, as the case may be, in a name
other than that of the registered holder of the certificate surrendered, or
shall establish to the satisfaction of Parent or its agent that such tax has
been paid or is not applicable. Notwithstanding the foregoing, none of Martin
Marietta, Lockheed or Parent shall be liable to any holder of shares of Martin
Marietta Common Stock, Lockheed Common Stock or Martin Marietta Preferred Stock
for any shares of Parent Common Stock or Parent Preferred Stock, as the case may
be (or dividends or distributions with respect thereto), delivered to a public
official pursuant to any applicable abandoned property, escheat or similar law.
SECTION 1.5 Cancellation of Parent Stock. The shares of the capital stock
of Parent owned by Martin Marietta and Lockheed immediately prior to the Merger
Date will be cancelled immediately upon consummation of the Atlantic Sub Merger
and the Pacific Sub Merger, respectively. The Atlantic Sub Merger and the
Pacific Sub Merger are sometimes together referred to as the "Mergers" and the
Atlantic Sub Merger Agreement and the Pacific Sub Merger Agreement are sometimes
together referred to as the "Merger Agreements."
ARTICLE II
STOCKHOLDER APPROVAL
Subject to the terms and conditions contained herein, this Agreement,
together with the Atlantic Sub Merger Agreement and the transactions
contemplated thereby, shall be submitted for approval to the holders of shares
of Martin Marietta Common Stock and Martin Marietta Preferred Stock, all of whom
shall vote
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together as a single class at a meeting to be duly held for this purpose by
Martin Marietta (the "Martin Marietta Meeting"), and this Agreement, together
with the Pacific Sub Merger Agreement, shall be submitted for adoption and
approval to the holders of shares of Lockheed Common Stock at a meeting to be
duly held for this purpose by Lockheed (the "Lockheed Meeting"). Martin Marietta
and Lockheed shall coordinate and cooperate with respect to the timing of such
meetings and shall endeavor to hold such meetings on the same day and as soon as
practicable after the date hereof. Subject to the applicable fiduciary duties of
their respective directors, Martin Marietta and Lockheed shall recommend that
their respective stockholders approve this Agreement and the transactions
contemplated hereby and such recommendation shall be contained in the Joint
Proxy Statement referred to in Sections 4.11 and 5.11. On the first business day
on or by which (a) this Agreement and the Atlantic Sub Merger Agreement have
been duly approved by the requisite vote of the holders of shares of Martin
Marietta Common Stock and Martin Marietta Preferred Stock, (b) this Agreement
and the Pacific Sub Merger Agreement have been duly adopted and approved by the
requisite vote of the holders of shares of Lockheed Common Stock and (c) the
closing of the transactions contemplated by this Agreement and the Merger
Agreements shall have occurred, or such later date as shall be agreed upon by
Martin Marietta and Lockheed, Articles of Merger (in the case of the Atlantic
Sub Merger) and a Certificate of Merger (in the case of the Pacific Sub Merger)
relating to the Mergers shall be filed in accordance with the Maryland Statute
and the Delaware Statute, respectively, and the Mergers shall become effective
simultaneously in accordance with the terms of the Merger Agreements (such time
and date are referred to as the "Merger Date").
ARTICLE III
BOARDS OF DIRECTORS OF PARENT,
MARTIN MARIETTA AND LOCKHEED;
OFFICERS OF MARTIN MARIETTA AND LOCKHEED
It is the intent of the parties to this Agreement that Martin Marietta and
Lockheed, as subsidiaries of Parent, will each continue (so far as practicable
and consistent with the basic purposes of this Agreement) the separate
operations of their respective business enterprises, subject to the combining of
such operations and to such other organizational and structural changes as
management may from time to time deem appropriate. With that objective in mind,
Martin Marietta, Lockheed and Parent agree as follows:
SECTION 3.1 Parent Board of Directors. On the Merger Date, the number of
directors comprising the full Board of Directors of Parent shall be 24 (as
provided in Parent's Bylaws), composed as follows:
(a) twelve directors shall be designated by Martin Marietta by its
Board Nominating Committee; and
(b) twelve directors shall be designated by Lockheed by its Board
Nominating Committee.
It is the intent of the parties that membership on the major committees of
Parent's Board of Directors shall initially consist of an equal number of
designees of Martin Marietta and Lockheed.
SECTION 3.2 Martin Marietta Board of Directors; Officers. On the Merger
Date, the Board of Directors of Martin Marietta shall include those current
directors of Martin Marietta who are designated as such by the Chief Executive
Officer of Martin Marietta. The officers of Martin Marietta immediately prior to
the Merger Date will continue in such capacities immediately following the
Merger Date.
SECTION 3.3 Lockheed Board of Directors; Officers. On the Merger Date,
the Board of Directors of Lockheed shall include those current directors of
Lockheed who are designated as such by the Chief Executive Officer of Lockheed.
The officers of Lockheed immediately prior to the Merger Date will continue in
such capacities immediately following the Merger Date.
SECTION 3.4 Parent Dividend. It is the intention of the parties that the
initial quarterly dividend with respect to Parent stock shall be at the annual
rate of $1.40 per share, subject to approval and declaration by the Board of
Directors of Parent.
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ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF MARTIN MARIETTA
Martin Marietta represents and warrants to, and agrees with, Lockheed as
follows (except as disclosed in a schedule dated the date hereof and furnished
to Lockheed, hereafter referred to as the "Martin Marietta Schedule"):
SECTION 4.1 Organization, Qualification, Etc. Martin Marietta is a
corporation duly organized, validly existing and in good standing under the laws
of its state of incorporation and has the corporate power and authority to own
its properties and assets and to carry on its business as it is now being
conducted and is duly qualified to do business and is in good standing in each
jurisdiction in which the ownership of its properties or the conduct of its
business requires such qualification, except for jurisdictions in which such
failure to be so qualified or to be in good standing would not, individually or
in the aggregate, have a material adverse effect on the business, results of
operations or financial condition of Martin Marietta and its Subsidiaries taken
as a whole. The copies of Martin Marietta's charter and bylaws which have been
delivered to Lockheed are complete and correct and in full force and effect on
the date hereof. Each of Martin Marietta's Significant Subsidiaries (as
hereinafter defined) is a corporation duly organized, validly existing and in
good standing under the laws of its jurisdiction of incorporation, has the
corporate power and authority to own its properties and to carry on its business
as it is now being conducted, and is duly qualified to do business and is in
good standing in each jurisdiction in which the ownership of its property or the
conduct of its business requires such qualification, except for jurisdictions in
which such failure to be so qualified or to be in good standing would not,
individually or in the aggregate, have a material adverse effect on the
business, results of operations or financial condition of Martin Marietta and
its Subsidiaries taken as a whole. All the outstanding shares of capital stock
of Martin Marietta's Significant Subsidiaries are validly issued, fully paid and
non-assessable and (except as set forth in the next sentence) are owned by
Martin Marietta, directly or indirectly, free and clear of all liens, claims,
charges or encumbrances, except for restrictions contained in credit agreements
and similar instruments to which Martin Marietta is a party under which no event
of default has occurred or arisen. Martin Marietta owns approximately 81% of the
outstanding shares of common stock of Martin Marietta Materials, Inc. There are
no existing options, rights of first refusal, preemptive rights, calls or
commitments of any character relating to the issued or unissued capital stock or
other securities of any Subsidiary of Martin Marietta other than rights of
refusal and preemptive rights held by Martin Marietta with respect to certain
Subsidiaries.
SECTION 4.2 Capital Stock. The authorized capital stock of Martin
Marietta consists of 550,000,000 shares, divided into 20,000,000 shares of
Series A Preferred Stock, par value $1.00 per share ("Martin Marietta Preferred
Stock"), 30,000,000 shares of Series Preferred Stock, par value $1.00 per share
("Martin Marietta Series Preferred Stock"), and 500,000,000 shares of common
stock, par value $1.00 per share ("Martin Marietta Common Stock"). As of July
31, 1994, 20,000,000 shares of Martin Marietta Preferred Stock, no shares of
Martin Marietta Series Preferred Stock and 95,948,640 shares of Martin Marietta
Common Stock were outstanding. All the outstanding shares of capital stock of
Martin Marietta have been validly issued and are fully paid and nonassessable.
As of July 31, 1994, there were no outstanding subscriptions, options, warrants,
rights or other arrangements or commitments obligating Martin Marietta to issue
any shares of its capital stock ("Martin Marietta Options") other than:
(a) upon conversion of the Martin Marietta Preferred Stock;
(b) options to acquire 4,706,450 shares of Martin Marietta Common
Stock granted on or prior to July 31, 1994 pursuant to employee incentive
and benefit plans; and
(c) Martin Marietta's dividend reinvestment plan.
Since July 31, 1994 (A) no shares of Martin Marietta Common Stock or Martin
Marietta Preferred Stock have been issued except issuances of Martin Marietta
Common Stock upon the exercise of Martin Marietta Options referred to in clause
(b) above, and (B) no Martin Marietta Options have been authorized, issued or
granted, except pursuant to Martin Marietta's Shareholder Rights Agreement,
dated as of August 29, 1994, with First Chicago Trust Company of New York (the
"Martin Marietta Rights Plan").
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SECTION 4.3 Corporate Authority Relative to this Agreement; No
Violation. Martin Marietta has the corporate power to enter into this Agreement
and the Atlantic Sub Merger Agreement, and to carry out its obligations
hereunder and thereunder. The execution and delivery of this Agreement and the
Atlantic Sub Merger Agreement and the consummation of the transactions
contemplated hereby and thereby have been duly and validly authorized by the
Board of Directors of Martin Marietta and, except for the approval of its
stockholders, no other corporate proceedings on the part of Martin Marietta are
necessary to authorize this Agreement, the Atlantic Sub Merger Agreement and the
transactions contemplated hereby and thereby. The Board of Directors of Martin
Marietta has determined that the transactions contemplated by this Agreement and
the Atlantic Sub Merger Agreement are in the best interests of Martin Marietta
and its stockholders and to recommend to such stockholders that they vote in
favor thereof. This Agreement and the Atlantic Sub Merger Agreement have been
duly and validly executed and delivered by Martin Marietta and, assuming this
Agreement and the Atlantic Sub Merger Agreement constitute valid and binding
Agreements of the other parties hereto and thereto, this Agreement and the
Atlantic Sub Merger Agreement constitute valid and binding agreements of Martin
Marietta, enforceable against Martin Marietta in accordance with their
respective terms (except insofar as enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or similar laws affecting
creditors' rights generally, or by principles governing the availability of
equitable remedies). Martin Marietta is not subject to or obligated under any
charter, bylaw or contract provision or any license, franchise or permit, or
subject to any order or decree, which would be breached or violated by its
executing or, subject to the approval of its stockholders, carrying out this
Agreement or the Atlantic Sub Merger Agreement, except for any breaches or
violations which individually or in the aggregate would not have a material
adverse effect on the business, results of operations or financial condition of
Martin Marietta and its Subsidiaries taken as a whole. Other than in connection
with or in compliance with the provisions of the Maryland Statute, the
Securities Act of 1933, as amended (the "Securities Act"), the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), the Hart-Scott-Rodino
Antitrust Improvements Act of 1976 (the "HSR Act"), Section 4043 of ERISA (as
hereinafter defined), any non-United States competition, antitrust and
investment laws, and the securities or blue sky laws of the various states
(collectively, the "Martin Marietta Required Statutory Approvals"), no
authorization, consent or approval of, or filing with, any governmental body or
authority is necessary for the consummation by Martin Marietta of the
transactions contemplated by this Agreement and the Atlantic Sub Merger
Agreement, except for such authorizations, consents, approvals or filings, the
failure to obtain or make which would not have a material adverse effect on the
business, results of operations or financial condition of Martin Marietta and
its Subsidiaries taken as a whole or on the consummation of the transactions
contemplated hereby.
SECTION 4.4 Reports and Financial Statements. Martin Marietta has
previously furnished to Lockheed true and complete copies of:
(a) Martin Marietta's Annual Reports on Form 10-K filed with the
Securities and Exchange Commission (the "SEC") for each of the years ended
December 31, 1991 through 1993;
(b) Martin Marietta's Quarterly Reports on Form 10-Q filed with the
SEC for the quarters ended March 31 and June 30, 1994;
(c) each definitive proxy statement filed by Martin Marietta with the
SEC since December 31, 1991;
(d) each final prospectus filed by Martin Marietta with the SEC since
December 31, 1991, other than prospectuses contained in filings on Form S-8
and filings with respect to Martin Marietta's dividend reinvestment plan on
Form S-3;
(e) all Current Reports on Form 8-K filed by Martin Marietta with the
SEC since December 31, 1993; and
(f) Reports on Form 11-K filed with the SEC with respect to employee
benefit plans of Martin Marietta or any of its Subsidiaries since December
31, 1993.
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As of their respective dates, such reports, proxy statements and prospectuses
did not contain any 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, in light of the circumstances under which they were made, not
misleading. The audited consolidated financial statements and unaudited
consolidated interim financial statements included in such reports, proxy
statements and prospectuses (including any related notes and schedules) fairly
present the financial position of Martin Marietta and its consolidated
Subsidiaries as of the dates thereof and the results of operations and changes
in financial position or other information included therein for the periods or
as of the dates then ended (subject, where appropriate, to normal year-end
accrual adjustments), in each case in accordance with past practice and
generally accepted accounting principles in the United States ("GAAP")
consistently applied during the periods involved (except as otherwise disclosed
in the notes thereto). Since December 31, 1991, Martin Marietta has timely filed
all reports, registration statements and other filings required to be filed with
the SEC under the rules and regulations of the SEC. For purposes of this Section
4.4, the term "Martin Marietta" shall include "Martin Marietta Technologies,
Inc." and "Martin Marietta Materials, Inc.".
SECTION 4.5 No Undisclosed Liabilities. As of June 30, 1994, neither
Martin Marietta nor any of its Subsidiaries had any liabilities or obligations
of any nature, whether or not accrued, contingent or otherwise, that would be
required by GAAP to be reflected on a consolidated balance sheet of Martin
Marietta and its Subsidiaries (including the notes thereto), except (a)
liabilities or obligations reflected in any of the documents referred to in
Section 4.4 and (b) liabilities or obligations which would not have,
individually or in the aggregate, a material adverse effect on the business,
results of operations or financial condition of Martin Marietta and its
Subsidiaries taken as a whole.
SECTION 4.6 No Violation of Law. The businesses of Martin Marietta and its
Subsidiaries are not being conducted in violation of any law, ordinance or
regulation of any governmental entity (provided that no representation or
warranty is made in this Section 4.6 with respect to Environmental Laws (as
defined in Section 4.7)) except (a) as described in any of the documents
referred to in Section 4.4 and (b) for violations or possible violations which
individually or in the aggregate do not, and, insofar as reasonably can be
foreseen, in the future would not, have a material adverse effect on the
business, results of operations or financial condition of Martin Marietta and
its Subsidiaries taken as a whole.
SECTION 4.7 Environmental Laws and Regulations. Except as described in any
of the documents referred to in Section 4.4, (i) Martin Marietta and each of its
Subsidiaries is in material compliance with all applicable federal, state and
local laws and regulations relating to pollution or protection of human health
or the environment (including, without limitation, ambient air, surface water,
ground water, land surface or subsurface strata) (collectively, "Environmental
Laws"), except for non-compliance that individually or in the aggregate do not,
and, insofar as reasonably can be foreseen, in the future would not, have a
material adverse effect on the business, results of operations or financial
condition of Martin Marietta and its Subsidiaries taken as a whole, which
compliance includes, but is not limited to, the possession by Martin Marietta
and its Subsidiaries of all material permits and other governmental
authorizations required under applicable Environmental Laws, and compliance with
the terms and conditions thereof; (ii) neither Martin Marietta nor any of its
Subsidiaries has received written notice of, or, to the knowledge of Martin
Marietta, is the subject of, any actions, causes of action, claims,
investigations, demands or notices by any person or entity alleging liability
under or non-compliance with any Environmental Law ("Environmental Claims") that
individually or in the aggregate would have a material adverse effect on the
business, results of operations or financial condition of Martin Marietta and
its Subsidiaries taken as a whole; and (iii) to the knowledge of Martin
Marietta, there are no circumstances that are reasonably likely to prevent or
interfere with such material compliance in the future.
SECTION 4.8 No Undisclosed Employee Benefit Plan Liabilities. All
"employee benefit plans," as defined in Section 3(3) of the Employee Retirement
Income Security Act of 1974, as amended ("ERISA"), maintained or contributed to
by Martin Marietta or its Subsidiaries are in compliance with all applicable
provisions of ERISA and the Internal Revenue Code of 1986, as amended (the
"Code"), and Martin Marietta and its Subsidiaries do not have any liabilities or
obligations with respect to any such employee benefit plans, whether or not
accrued, contingent or otherwise, except (a) as described in any of the
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documents referred to in Section 4.4 and (b) for instances of non-compliance or
liabilities or obligations that would not have, individually or in the
aggregate, a material adverse effect on the business, results of operations or
financial condition of Martin Marietta and its Subsidiaries taken as a whole.
SECTION 4.9 Absence of Certain Changes or Events. Other than as disclosed
in the documents referred to in Section 4.4, since December 31, 1993 there has
been no material adverse change in the business, prospects, results of
operations or financial condition of Martin Marietta and its Subsidiaries taken
as a whole.
SECTION 4.10 Investigations; Litigation. Except as described in any of the
documents referred to in Section 4.4:
(a) no material investigation or review by any governmental entity
with respect to Martin Marietta or any of its Subsidiaries is pending (or,
to Martin Marietta's knowledge, threatened) nor has any governmental entity
indicated to Martin Marietta an intention to conduct the same; and
(b) there are no actions, suits or proceedings pending (or, to Martin
Marietta's knowledge, threatened) against or affecting Martin Marietta or
its Subsidiaries at law or in equity, or before any federal, state,
municipal or other governmental department, commission, board, bureau,
agency or instrumentality which, either individually or in the aggregate,
are reasonably likely to result in any material adverse change in the
business, prospects, results of operations or financial condition of Martin
Marietta and its Subsidiaries taken as a whole.
SECTION 4.11 Joint Proxy Statement; Registration Statement; Other
Information. None of the information with respect to Martin Marietta or its
Subsidiaries or the Atlantic Sub Merger to be included in the Joint Proxy
Statement (as defined herein) or the Registration Statement (referred to in
Section 6.3) will, in the case of the Joint Proxy Statement or any amendments
thereof or supplements thereto, at the time of the mailing of the Joint Proxy
Statement or any amendments or supplements thereto, and at the time of the
Martin Marietta Meeting, or, in the case of the Registration Statement, at the
time it becomes effective, 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, in light of the circumstances under which
they are made, not misleading. The Joint Proxy Statement will comply as to form
in all material respects with the provisions of the Exchange Act and the rules
and regulations promulgated thereunder, except that no representation is made by
Martin Marietta with respect to information supplied in writing by Lockheed or
any affiliate of Lockheed specifically for inclusion in the Joint Proxy
Statement. The letters to stockholders, notices of meeting, joint proxy
statement and forms of proxies to be distributed to stockholders in connection
with the Mergers, and any schedules required to be filed with the SEC in
connection therewith are collectively referred to herein as the "Joint Proxy
Statement".
SECTION 4.12 Accounting Matters. Neither Martin Marietta nor, to its
knowledge, any of its affiliates has taken or agreed to take any action that
would prevent Parent from accounting for the transactions to be effected
pursuant to Article I of this Agreement in accordance with the pooling of
interests method of accounting under the requirements of Opinion No. 16
"Business Combinations" of the Accounting Principles Board of the American
Institute of Certified Public Accountants, as amended by applicable
pronouncements by the Financial Accounting Standards Board ("APB No. 16"). As
used in this Agreement (except as specifically otherwise defined), the term
"affiliate" shall mean, as to any person, any other person which directly or
indirectly controls, or is under common control with, or is controlled by, such
person. As used in this definition, "control" (including, with its correlative
meanings, "controlled by" and "under common control with") shall mean
possession, directly or indirectly, of power to direct or cause the direction of
management or policies (whether through ownership of securities or partnership
or other ownership interests, by contract or otherwise).
SECTION 4.13 Martin Marietta Rights Plan. Under the terms of the Martin
Marietta Rights Plan, the transactions contemplated by this Agreement will not
cause a Distribution Date to occur or cause the rights issued pursuant to the
Martin Marietta Rights Plan to become exercisable, and as a result of the terms
of the Martin Marietta Rights Plan such rights will be cancelled and cease to
exist upon consummation of the transactions contemplated hereby.
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SECTION 4.14 Ownership of Lockheed Stock. On the date hereof Martin
Marietta and its Subsidiaries do not beneficially own in excess of 1,000 shares
of Lockheed Common Stock in the aggregate (exclusive of any shares owned by
Martin Marietta's employee benefit plans) and is not an "interested stockholder"
of Lockheed within the meaning of Section 203 of the Delaware Statute.
SECTION 4.15 Tax Matters. (a) All federal, state, local, and foreign tax
returns required to be filed by or on behalf of Martin Marietta and each of its
Subsidiaries have been timely filed, and all returns filed are complete and
accurate to the knowledge of Martin Marietta. All taxes shown on filed returns
have been paid or adequate provision for the payment of all such taxes has been
made. As of the date of this Agreement, there is no audit examination,
deficiency, refund litigation, proposed adjustment or matter in controversy with
respect to any taxes that may reasonably be expected to result in a
determination materially adverse to Martin Marietta or any of its Subsidiaries,
except as adequately reserved against in the most recent financial statements
contained in the documents referred to in Section 4.4. All assessments for
taxes, interest, additions, and penalties due with respect to completed and
settled examinations or concluded litigation have been paid.
(b) No stock or securities will be issued to any person other than the
securityholders of Martin Marietta, Lockheed or Parent in connection with the
transactions contemplated by this Agreement; except in connection with employee
benefit programs or Martin Marietta's dividend reinvestment plan, the management
of Martin Marietta has no plan or intention for Parent to issue any stock other
than Parent Common Stock and Parent Preferred Stock in connection with the
transactions contemplated by this Agreement; except in connection with employee
benefit programs, Martin Marietta's dividend reinvestment plan or otherwise in
the ordinary course of business, the management of Martin Marietta has no plan
or intention for Parent to redeem or otherwise reacquire any Parent Preferred
Stock or Parent Common Stock to be issued in connection with the transactions
contemplated by this Agreement; and the management of Martin Marietta has no
plan or intention to terminate the existence of Parent or to merge Parent with
any other corporation.
(c) Martin Marietta is not aware of any plan or intention of Parent to
liquidate Martin Marietta, to merge Martin Marietta with or into another
corporation or to sell or otherwise dispose of the stock of Martin Marietta
except for transfers of stock to corporations controlled by Parent. For purposes
of this representation, "control" is defined in Section 368(c) of the Code.
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF LOCKHEED
Lockheed represents and warrants to, and agrees with, Martin Marietta as
follows (except as disclosed in a schedule dated the date hereof and furnished
to Martin Marietta, hereafter referred to as the "Lockheed Schedule"):
SECTION 5.1 Organization, Qualification, Etc. Lockheed is a corporation
duly organized, validly existing and in good standing under the laws of the
state of its incorporation and has the corporate power and authority to own its
properties and assets and to carry on its business as it is now being conducted
and is duly qualified to do business and is in good standing in each
jurisdiction in which the ownership of its properties or the conduct of its
business requires such qualification, except for jurisdictions in which such
failure to be so qualified or to be in good standing would not, individually or
in the aggregate, have a material adverse effect on the business, results of
operations or financial condition of Lockheed and its Subsidiaries taken as a
whole. The copies of Lockheed's certificate of incorporation and bylaws which
have been delivered to Martin Marietta are complete and correct and in full
force and effect on the date hereof. Each of Lockheed's Significant Subsidiaries
is a corporation duly organized, validly existing and in good standing under the
laws of its jurisdiction of incorporation, has the corporate power and authority
to own its properties and to carry on its business as it is now being conducted,
and is duly qualified to do business and is in good standing in each
jurisdiction in which the ownership of its property or the conduct of its
business requires such qualification, except for jurisdictions in which such
failure to be so qualified or to be in good standing would not, individually or
in the aggregate, have a material adverse effect on the business, results of
operations or financial condition of Lockheed and its Subsidiaries taken as a
whole. All the outstanding shares of capital stock of Lockheed's
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Significant Subsidiaries are validly issued, fully paid and non-assessable and
are owned by Lockheed, directly or indirectly, free and clear of all liens,
claims charges or encumbrances, except for restrictions contained in credit
agreements and similar instruments to which Lockheed is a party under which no
event of default has occurred or arisen. There are no existing options, rights
of first refusal, preemptive rights, calls or commitments of any character
relating to the issued or unissued capital stock or other securities of any
Subsidiary of Lockheed.
SECTION 5.2 Capital Stock. The authorized capital stock of Lockheed
consists of 100,000,000 shares of common stock, par value $1.00 per share
("Lockheed Common Stock"), and 2,500,000 shares of Preferred Stock, par value
$1.00 per share ("Lockheed Preferred Stock"), of which 1,000,000 shares were
designated as Series A Junior Participating Preferred Stock ("Lockheed Series A
Preferred"). As of July 31, 1994, 62,867,345 shares of Lockheed Common Stock
(excluding 9,775,996 shares held in Lockheed's treasury) and no shares of
Lockheed Preferred Stock were issued and outstanding. All the outstanding shares
of Lockheed Common Stock have been validly issued and are fully paid and
nonassessable. As of July 31, 1994, there were no outstanding subscriptions,
options, warrants, rights or other arrangements or commitments obligating
Lockheed to issue any shares of its capital stock ("Lockheed Options") other
than:
(a) rights to acquire shares of Lockheed Series A Preferred pursuant
to Lockheed's Shareholder Rights Agreement, dated as of December 8, 1986,
with First Interstate Bank, Ltd., as amended (the "Lockheed Rights Plan");
and
(b) options to acquire 3,287,077 shares of Lockheed Common Stock
granted on or prior to July 31, 1994 pursuant to employee incentive and
benefit plans.
Since July 31, 1994 (A) no shares of Lockheed Common Stock have been issued
except issuances of Lockheed Common Stock upon the exercise of Lockheed Options
referred to in clause (b) above, and (B) except for an option grant relating to
1,500 shares, no Lockheed Options have been authorized, issued or granted.
SECTION 5.3 Corporate Authority Relative to this Agreement; No
Violation. Lockheed has the corporate power to enter into this Agreement and
the Pacific Sub Merger Agreement, and to carry out its obligations hereunder and
thereunder. The execution and delivery of this Agreement and the Pacific Sub
Merger Agreement, and the consummation of the transactions contemplated hereby
and thereby have been duly and validly authorized by the Board of Directors of
Lockheed and, except for the approval of its stockholders, no other corporate
proceedings on the part of Lockheed are necessary to authorize this Agreement,
the Pacific Sub Merger Agreement and the transactions contemplated hereby and
thereby. The Board of Directors of Lockheed has determined that the transactions
contemplated by this Agreement and the Pacific Sub Merger Agreement are in the
best interests of Lockheed and its stockholders and to recommend to such
stockholders that they vote in favor thereof. This Agreement and the Pacific Sub
Merger Agreement have been duly and validly executed and delivered by Lockheed
and, assuming this Agreement and the Pacific Sub Merger Agreement constitute
valid and binding agreements of the other parties hereto and thereto, this
Agreement and the Pacific Sub Merger constitute valid and binding agreements of
Lockheed, enforceable against Lockheed in accordance with their respective terms
(except insofar as enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting creditors'
rights generally, or by principles governing the availability of equitable
remedies). Lockheed is not subject to or obligated under any charter, by-law or
contract provision or any license, franchise or permit, or subject to any order
or decree, which would be breached or violated by its executing or, subject to
the approval of its stockholders, carrying out this Agreement or the Pacific Sub
Merger Agreement, except for any breaches or violations which individually or in
the aggregate would not have a material adverse effect on the business, results
of operations or financial condition of Lockheed and its Subsidiaries taken as a
whole. Other than in connection with or in compliance with the provisions of the
Delaware Statute, the Securities Act, the Exchange Act, the HSR Act, Section
4043 of ERISA, any non-United States competition, antitrust and investment laws,
and the securities or blue sky laws of the various states (collectively, the
"Lockheed Required Statutory Approvals"), no authorization, consent or approval
of, or filing with, any governmental body or authority is necessary for the
consummation by Lockheed of the transactions contemplated by this
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Agreement and the Pacific Sub Merger Agreement, except for such authorizations,
consents, approvals or filings, the failure to obtain or make which would not
have a material adverse effect on the business, results of operations or
financial condition of Lockheed and its Subsidiaries taken as a whole or on the
consummation of the transaction contemplated hereby.
SECTION 5.4 Reports and Financial Statements. Lockheed has previously
furnished to Martin Marietta true and complete copies of:
(a) Lockheed's Annual Reports on Form 10-K filed with the SEC for each
of the years ended December 31, 1991 through 1993;
(b) Lockheed's Quarterly Reports on Form 10-Q filed with the SEC for
the quarters ended March 31 and June 30, 1994;
(c) each definitive proxy statement filed by Lockheed with the SEC
since December 31, 1991;
(d) each final prospectus filed by Lockheed with the SEC since
December 31, 1991;
(e) all Current Reports on Form 8-K filed by Lockheed with the SEC
since December 31, 1993; and
(f) Reports on Form 11-K filed with the SEC with respect to employee
benefit plans of Lockheed or any of its Subsidiaries since December 31,
1993.
As of their respective dates, such reports, proxy statements and prospectuses
did not contain any 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, in light of the circumstances under which they were made, not
misleading. The audited consolidated financial statements and unaudited
consolidated interim financial statements included in such reports, proxy
statements and prospectuses (including any related notes and schedules) fairly
present the financial position of Lockheed and its consolidated Subsidiaries as
of the dates thereof and the results of operations and changes in financial
position or other information included therein for the periods or as of the
dates then ended (subject, where appropriate, to normal year-end accrual
adjustments), in each case in accordance with past practice and GAAP
consistently applied during the periods involved (except as otherwise disclosed
in the notes thereto). Since December 31, 1991, Lockheed has timely filed all
reports, registration statements and other filings required to be filed with the
SEC under the rules and regulations of the SEC.
SECTION 5.5 No Undisclosed Liabilities. As of June 30, 1994, neither
Lockheed nor any of its Subsidiaries had any liabilities or obligations of any
nature, whether or not accrued, contingent or otherwise, that would be required
by GAAP to be reflected on a consolidated balance sheet of Lockheed and its
Subsidiaries (including the notes thereto), except (a) liabilities or
obligations reflected in any of the documents referred to in Section 5.4 and (b)
liabilities or obligations, which would not have, individually or in the
aggregate, a material adverse effect on the business, results of operations or
financial condition of Lockheed and its Subsidiaries taken as a whole.
SECTION 5.6 No Violation of Law. The businesses of Lockheed and its
Subsidiaries are not being conducted in violation of any law, ordinance or
regulation of any governmental entity (provided that no representation or
warranty is made in this Section 5.6 with respect to Environmental Laws) except
(a) as described in any of the documents referred to in Section 5.4, and (b) for
violations or possible violations which individually or in the aggregate do not,
and, insofar as reasonably can be foreseen, in the future would not, have a
material adverse effect on the business, results of operations or financial
condition of Lockheed and its Subsidiaries taken as a whole.
SECTION 5.7 Environmental Laws and Regulations. Except as described in
any of the documents referred to in Section 5.4, (i) Lockheed and each of its
Subsidiaries is in material compliance with all applicable Environmental Laws,
except for non-compliance that individually or in the aggregate do not, and,
insofar as reasonably can be foreseen, in the future would not, have a material
adverse effect on the business, results of operations or financial condition of
Lockheed and its Subsidiaries taken as a whole, which
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compliance includes, but is not limited to, the possession by Lockheed and its
Subsidiaries of all material permits and other governmental authorizations
required under applicable Environmental Laws, and compliance with the terms and
conditions thereof; (ii) neither Lockheed nor any of its Subsidiaries has
received written notice of, or, to the knowledge of Lockheed, is the subject of,
any Environmental Claims that individually or in the aggregate would have a
material adverse effect on the business, results of operations or financial
condition of Lockheed and its Subsidiaries taken as a whole; and (iii) to the
knowledge of Lockheed, there are no circumstances that are reasonably likely to
prevent or interfere with such material compliance in the future.
SECTION 5.8 No Undisclosed Employee Benefit Plan Liabilities. All
"employee benefit plans," as defined in Section 3(3) of ERISA, maintained or
contributed to by Lockheed or its Subsidiaries are in compliance with all
applicable provisions of ERISA and the Code, and Lockheed and its Subsidiaries
do not have any liabilities or obligations with respect to any such employee
benefit plans, whether or not accrued, contingent or otherwise, except (a) as
described in any of the documents referred to in Section 5.4 and (b) for
instances of non-compliance or liabilities or obligations that would not have,
individually or in the aggregate, a material adverse effect on the business,
results of operations or financial condition of Lockheed and its Subsidiaries
taken as a whole.
SECTION 5.9 Absence of Certain Changes or Events. Other than as disclosed
in the documents referred to in Section 5.4, since December 31, 1993 there has
been no material adverse change in the business, prospects, results of
operations or financial condition of Lockheed and its Subsidiaries taken as a
whole.
SECTION 5.10 Investigations; Litigation. Except as described in any of
the documents referred to in Section 5.4:
(a) no material investigation or review by any governmental entity
with respect to Lockheed or any of its Subsidiaries is pending (or, to
Lockheed's knowledge, threatened), nor has any governmental entity
indicated to Lockheed an intention to conduct the same; and
(b) there are no actions, suits or proceedings pending (or, to
Lockheed's knowledge, threatened) against or affecting Lockheed or its
Subsidiaries at law or in equity, or before any federal, state, municipal
or other governmental department, commission, board, bureau, agency or
instrumentality which, either individually or in the aggregate, are
reasonably likely to result in any material adverse change in the business,
prospects, results of operations or financial condition of Lockheed and its
Subsidiaries taken as a whole.
SECTION 5.11 Joint Proxy Statement; Registration Statement; Other
Information. None of the information with respect to Lockheed or its
Subsidiaries or the Pacific Sub Merger to be included in the Joint Proxy
Statement or the Registration Statement will, in the case of the Joint Proxy
Statement or any amendments thereof or supplements thereto, at the time of the
mailing of the Joint Proxy Statement or any amendments or supplements thereto,
and at the time of the Lockheed Meeting or, in the case of the Registration
Statement, at the time it becomes effective, 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, in light of the
circumstances under which they are made, not misleading. The Joint Proxy
Statement will comply as to form in all material respects with the provisions of
the Exchange Act and the rules and regulations promulgated thereunder, except
that no representation is made by Lockheed with respect to information supplied
in writing by Martin Marietta or any affiliate of Martin Marietta specifically
for inclusion in the Joint Proxy Statement.
SECTION 5.12 Accounting Matters. Neither Lockheed nor, to its best
knowledge, any of its affiliates has taken or agreed to take any action that
would prevent Parent from accounting for the transactions to be effected
pursuant to Article I of this Agreement in accordance with the pooling of
interests method of accounting under the requirements of APB No. 1 6.
SECTION 5.13 Lockheed Rights Plan. Under the terms of the Lockheed Rights
Plan, the transactions contemplated by this Agreement will not cause a
Distribution Date to occur or cause the rights issued pursuant to the Lockheed
Rights Plan to become exercisable, and, by action taken prior to the Merger
Date,
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as a result of the terms of the Lockheed Rights Plan and the Pacific Sub Merger
such rights will be cancelled and cease to exist.
SECTION 5.14 Ownership of Martin Marietta Stock. On the date hereof
Lockheed and its Subsidiaries do not beneficially own in excess of 1,000 shares
of Martin Marietta Common Stock in the aggregate (exclusive of any shares owned
by Lockheed's employee benefit plans) and is not an "interested stockholder" or
an affiliate of an "interested stockholder" of Martin Marietta within the
meaning of Section 3-601(j) of the Maryland Statute.
SECTION 5.15 Tax Matters. (a) All federal, state, local, and foreign tax
returns required to be filed by or on behalf of Lockheed and each of its
Subsidiaries have been timely filed, and all returns filed are complete and
accurate to the knowledge of Lockheed. All taxes shown on filed returns have
been paid or adequate provision for the payment of all such taxes has been made.
As of the date of this Agreement, there is no audit examination, deficiency,
refund litigation, proposed adjustment or matter in controversy with respect to
any taxes that may reasonably be expected to result in a determination
materially adverse to Lockheed or any of its Subsidiaries, except as adequately
reserved against in the most recent financial statements contained in the
documents referred to in Section 5.4. All assessments for taxes, interest,
additions, and penalties due with respect to completed and settled examinations
or concluded litigation have been paid.
(b) No stock or securities will be issued to any person other than the
securityholders of Lockheed, Martin Marietta or Parent in connection with the
transactions contemplated by this Agreement; except in connection with employee
benefit programs, the management of Lockheed has no plan or intention for Parent
to issue any stock other than Parent Common Stock and Parent Preferred Stock in
connection with the transactions contemplated by this Agreement; except in
connection with employee benefit programs or otherwise in the ordinary course of
business, the management of Lockheed has no plan or intention for Parent to
redeem or otherwise reacquire any Parent Preferred Stock or Parent Common Stock
to be issued in connection with the transactions contemplated by this Agreement;
and the management of Lockheed has no plan or intention to terminate the
existence of Parent or to merge Parent with any other corporation.
(c) Following the Pacific Sub Merger, Lockheed will hold at least 90
percent of the fair market value of its net assets and at least 70 percent of
the fair market value of its gross assets and at least 90 percent of the fair
market value of Pacific Sub's net assets and at least 70 percent of the fair
market value of Pacific Sub's gross assets held immediately prior to such
Merger. For purposes of this representation, amounts used by Lockheed or Pacific
Sub to pay reorganization expenses, and all redemptions and distributions
(except for regular, normal dividends) made by Lockheed will be included as
assets held by Lockheed or Pacific Sub, respectively, immediately prior to the
Pacific Sub Merger.
(d) Lockheed has no plan or intention to issue additional shares of its
stock following the Pacific Sub Merger that would result in Parent's ceasing to
own all the outstanding shares of stock of Lockheed.
(e) Lockheed is not aware of any plan or intention of Parent: to liquidate
Lockheed; to merge Lockheed with or into another corporation; to sell or
otherwise dispose of the stock of Lockheed except for transfers of stock to
corporations controlled by Parent; to cause Lockheed to sell or otherwise
dispose of any of its assets or of any of the assets acquired from Pacific Sub,
except for dispositions made in the ordinary course of business or transfers of
assets to a corporation controlled by Lockheed; or to cause Lockheed to issue
any shares of capital stock to any person other than Parent. For purposes of
this representation, "control" is defined by Section 368(c) of the Code.
ARTICLE VI
ADDITIONAL COVENANTS AND AGREEMENTS
It is further agreed as follows:
SECTION 6.1 Conduct of Business by Martin Marietta or Lockheed. Prior to
the Merger Date or the date, if any, on which this Agreement is earlier
terminated pursuant to Section 8.1 (the "Termination Date"),
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and except as set forth in the Martin Marietta Schedule or the Lockheed
Schedule, as may be agreed to by the other parties hereto or as may be permitted
pursuant to this Agreement, Martin Marietta and Lockheed:
(a) shall, and shall cause each of their respective Subsidiaries to,
conduct their respective operations according to their ordinary and usual
course of business;
(b) shall use their reasonable efforts, and cause each of their
respective Subsidiaries to use its reasonable efforts, to preserve intact
their respective business organizations and goodwill in all material
respects, keep available the services of their respective officers and
employees as a group and maintain satisfactory relationships with
suppliers, distributors, customers and others having business relationships
with them;
(c) shall confer on a regular and frequent basis with one or more
representatives of one another to report operational matters of materiality
and the general status of ongoing operations;
(d) shall notify one another of any emergency or other change in the
normal course of their or their Subsidiaries' respective businesses or in
the operation of their or their Subsidiaries' respective properties and of
any governmental complaints, investigations or hearings (or communications
indicating that the same may be contemplated) if such emergency, change,
complaint, investigation or hearing would be material to the business,
operations or financial condition of either Martin Marietta or Lockheed and
their respective Subsidiaries, as the case may be, taken as a whole;
(e) shall not, and shall not permit any of their respective
Subsidiaries which is not wholly owned to, declare or pay any dividends on
or make any distribution with respect to their outstanding shares of
capital stock other than, with respect to Martin Marietta and Lockheed,
their respective regular quarterly cash dividends and, in the case of
Martin Marietta, pursuant to the Martin Marietta Rights Plan.
(f) shall not, and shall not permit any of their respective
Subsidiaries to, except in the ordinary course of business or except as
otherwise provided in this Agreement, enter into or amend any employment,
severance or similar agreements or arrangements with any directors or
executive officers;
(g) shall not, and shall not permit any of their respective
Subsidiaries to, authorize, propose or announce an intention to authorize
or propose, or enter into an agreement with respect to (or, subject to
applicable fiduciary duties of the directors of Martin Marietta and
Lockheed, recommend), any merger, consolidation or business combination
(other than the Mergers), any acquisition of a material amount of assets or
securities, any disposition of a material amount of assets or securities or
any release or relinquishment of any material contract rights not in the
ordinary course of business;
(h) shall not propose or adopt any amendments to their respective
corporate charters or bylaws;
(i) shall not, and shall not permit any of their respective
Subsidiaries to, issue any shares of their capital stock, except upon
conversion of the Martin Marietta Preferred Stock in the case of Martin
Marietta or upon exercise of rights issued pursuant to the Martin Marietta
Rights Plan or Lockheed Rights Plan or upon exercise of rights or options
issued pursuant to employee benefit plans, programs or arrangements in
existence on the date hereof, or Martin Marietta's dividend reinvestment
plan or effect any stock split or otherwise change its capitalization as it
existed on July 31, 1994 (except as contemplated herein);
(j) shall not, and shall not permit any of their respective
Subsidiaries to, grant, confer or award any options, warrants, conversion
rights or other rights, not existing on the date hereof, to acquire any
shares of its capital stock, except grants of options pursuant to employee
benefit plans, programs or arrangements in existence on the date hereof in
the ordinary course of business and consistent with past practice covering
not in excess of 25,000 shares of Martin Marietta Common Stock or 25,000
shares of Lockheed Common Stock;
(k) shall not, and shall not permit any of their respective
Subsidiaries to, except in connection with employee benefit plans in the
ordinary course of business or Martin Marietta's dividend reinvestment
plan, purchase or redeem any shares of its capital stock;
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(l) shall not, and shall not permit any of their respective
Subsidiaries to, take any actions which would, or would be reasonably
likely to, prevent Parent from accounting for the transactions to be
effected pursuant to Article I of this Agreement in accordance with the
pooling of interests method of accounting under the requirements of APB No.
16;
(m) shall not, and shall not permit any of their respective
Subsidiaries to, except as contemplated by Section 6.5, amend in any
significant respect the terms of their respective employee benefit plans,
programs or arrangements or any severance or similar agreements or
arrangements in existence on the date hereof, or adopt any new employee
benefit plans, programs or arrangements or any severance or similar
agreements or arrangements;
(n) shall not, and shall not permit any of their respective
Subsidiaries to, (i) enter into any material loan agreement or (ii) enter
into or bid with respect to any contract that is expected to result in a
material loss; and
(o) shall not, and shall not permit any of their respective
Subsidiaries to, agree in writing or otherwise, to take any of the
foregoing actions or any action which would make any representation or
warranty in Articles IV and V hereof untrue or incorrect.
For purposes of this Section 6.1, Martin Marietta Materials, Inc. or any of its
Subsidiaries shall not be considered to be a Subsidiary of Martin Marietta.
SECTION 6.2 Investigation. Each of Martin Marietta and Lockheed shall
afford to one another and to one another's officers, employees, accountants,
counsel and other authorized representatives full and complete access during
normal business hours, throughout the period prior to the earlier of the Merger
Date or the Termination Date, to its and its Subsidiaries' plants, properties,
contracts, commitments, books, and records (including but not limited to tax
returns) and any report, schedule or other document filed or received by it
pursuant to the requirements of federal or state securities laws, and shall use
their reasonable efforts to cause their respective representatives to furnish
promptly to one another such additional financial and operating data and other
information as to its and its Subsidiaries' respective businesses and properties
as the other or its duly authorized representatives may from time to time
reasonably request. The parties hereby agree that each of them will treat any
such information in accordance with the Confidentiality Agreement, dated March
29, 1994, between Martin Marietta and Lockheed (the "Confidentiality
Agreement"), and, subject to applicable law, will not disclose any such
information to any other party. Notwithstanding any provision of this Agreement
to the contrary, no party shall be obligated to make any disclosure in violation
of applicable laws or regulations, including any such laws or regulations
pertaining to the treatment of classified information. If for any reason the
Mergers are not consummated, each of Martin Marietta and Lockheed shall return
or shall cause to be returned all information (and any copies thereof or
extracts therefrom) obtained by it or its representatives pursuant to this
Agreement or in connection with the negotiations hereof to the other party and
will thereafter continue to treat as confidential all such information and shall
not use, or knowingly permit any other party to use, any such information.
SECTION 6.3 Cooperation. Martin Marietta and Lockheed shall together, or
pursuant to an allocation of responsibility to be agreed upon between them:
(a) prepare and file with the SEC as soon as is reasonably practicable
the Joint Proxy Statement and a registration statement of Parent (the
"Registration Statement") with respect to the transactions contemplated by
this Agreement, and use their reasonable efforts to have the Joint Proxy
Statement cleared by the SEC under the Exchange Act and the Registration
Statement declared effective by the SEC under the Securities Act;
(b) as soon as is reasonably practicable take all such action as may
be required under state blue sky or securities laws in connection with the
transactions contemplated by this Agreement;
(c) cooperate with one another in determining whether any filings are
required to be made with or consents required to be obtained from, any
third party or governmental authority in any jurisdiction prior to the
Merger Date in connection with the consummation of the transactions
contemplated in this
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Agreement and cooperate in making any such filings promptly and in seeking
to obtain timely any such consents;
(d) promptly make application to the NYSE and such other stock
exchanges as shall be agreed upon for the listing of the Parent Common
Stock and use its reasonable efforts to list such stock on the NYSE or such
other exchanges;
(e) promptly make their respective filings and any other required or
requested submissions under the HSR Act; and
(f) cooperate with one another in order to lift any injunctions or
remove any other impediment to the consummation of the transactions
contemplated herein, except that no party shall be required to agree to the
divestiture of any of its or the other party's material assets or to other
materially onerous conditions in order to obtain any governmental approval.
Subject to the limitations contained in Section 6.2, Martin Marietta and
Lockheed shall each furnish to one another and to one another's counsel all such
information as may be required in order to effect the foregoing actions and each
represents and warrants to the other that no information furnished by it in
connection with such actions or otherwise in connection with the consummation of
the transactions contemplated by this Agreement will contain any untrue
statement of a material fact or omit to state a material fact required to be
stated in order to make any information so furnished, in light of the
circumstances under which it is so furnished, not misleading.
SECTION 6.4 Affiliate Agreements. Each of Martin Marietta and Lockheed
(each of which is referred to in this Section 6.4 as a "Subject Company") shall,
prior to the Merger Date, cause to be delivered to the other a list, reviewed by
its counsel, identifying all persons who are, in its opinion, at the time of the
meeting of the Subject Company's stockholders to be held in accordance with
Article II, "affiliates" of the Subject Company for purposes of Rule 145
promulgated by the SEC under the Securities Act. Each Subject Company shall
furnish such information and documents as the other may reasonably request for
the purpose of reviewing such list. Each Subject Company shall use its
reasonable efforts to cause each person who is identified as an "affiliate" in
the list furnished pursuant to this Section 6.4 to execute a written agreement
on or prior to the Merger Date, in a form satisfactory to the other (an
"Affiliate Agreement"), that such person (a) will not offer or sell or otherwise
dispose of any of the shares of Parent Common Stock issued to such person
pursuant to the Mergers in violation of the Securities Act or the rules or
regulations promulgated by the SEC thereunder, and (b) will not offer or sell or
otherwise dispose of any of the shares of Martin Marietta Common Stock, Martin
Marietta Preferred Stock, Lockheed Common Stock, Parent Common Stock or Parent
Preferred Stock in a manner or at a time that will disqualify Parent from
accounting for the transactions contemplated by this Agreement in accordance
with the pooling of interests method of accounting.
SECTION 6.5 Employee Stock Options, Incentive and Benefit Plans. (a)
Simultaneously with the Atlantic Sub Merger, (i) each outstanding option to
purchase or acquire a share of Martin Marietta Common Stock under option plans
presently maintained by Martin Marietta ("Martin Marietta Option Plans") shall
be converted into an option to purchase that number of shares of Parent Common
Stock which could have been obtained upon the exercise of each such option at
the same exercise price, and all references in each such option to Martin
Marietta shall be deemed to refer to Parent, where appropriate, (ii) each
outstanding stock appreciation right under the Martin Marietta Option Plans
("Martin Marietta SAR") to receive a cash payment based on the Martin Marietta
Common Stock shall be converted into a stock appreciation right to receive a
cash payment based on the Parent Common Stock, for the same number of shares and
at the same base price as applied to the Martin Marietta SAR, and all references
in each Martin Marietta SAR to Martin Marietta shall be deemed to refer to
Parent, where appropriate, (iii) Parent shall assume the obligations of Martin
Marietta under the Martin Marietta Option Plans and (iv) each outstanding award
made pursuant to Martin Marietta's Amended and Restated Long Term Performance
Incentive Compensation Plan and its predecessor plans shall be amended or
converted into a similar instrument of Parent, in either case with such
adjustments to the terms of such awards, including but not limited to, the
formula setting forth the redemption value of such awards as are appropriate to
preserve the value inherent in such awards with no detrimental
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effects on the holders thereof without their consent. Subject to stockholder
approval of the 1994 Parent Stock Plan (as hereinafter defined), no additional
options or awards shall be granted pursuant to the Martin Marietta Option Plans
after the Atlantic Sub Merger.
(b) Simultaneously with the Pacific Sub Merger, (i) each outstanding option
(and related stock appreciation right ("Lockheed SAR"), if any) to purchase or
acquire a share of Lockheed Common Stock under option plans presently maintained
by Lockheed ("Lockheed Option Plans") shall be converted into an option
(together with a related stock appreciation right of Parent, if applicable), to
purchase 1.63 times the number of shares of Parent Common Stock which could have
been obtained upon the exercise of each such option, at an exercise price per
share equal to the exercise price for each such share of Lockheed Common Stock
subject to an option (and related Lockheed SAR, if any) under the Lockheed
Option Plans divided by 1.63, and all references in each such option (and
related Lockheed SAR, if any) to Lockheed shall be deemed to refer to Parent,
where appropriate, and (ii) Parent shall assume the obligations of Lockheed
under the Lockheed Option Plans. Subject to stockholder approval of the 1994
Parent Stock Plan, no additional options or awards shall be granted pursuant to
the Lockheed Option Plans after the Pacific Sub Merger.
(c) Martin Marietta and Lockheed agree that effective as of the Merger
Date, and subject to approval by the stockholders of Martin Marietta and
Lockheed, Parent shall adopt an omnibus securities award plan (the "1994 Parent
Stock Plan") for the purpose of granting stock options, restricted stock, stock
appreciation rights or other stock-based incentive awards to such employees of
Parent, Martin Marietta and Lockheed, and their respective Subsidiaries, in such
amounts and upon such terms and conditions as the Compensation Committee of the
Board of Directors of Parent shall, in its sole discretion, determine (subject
to the provisions of the 1994 Parent Stock Plan).
(d) Martin Marietta and Lockheed agree that each of their respective stock
option, employee incentive and benefit plans, programs and arrangements (in
addition to those for non-employee directors) and in the case of Martin
Marietta, its dividend reinvestment plan, shall be amended, to the extent
necessary or appropriate, to reflect the transactions contemplated by this
Agreement, including, but not limited to, (i) the conversion of shares of Martin
Marietta Common Stock or Lockheed Common Stock held pursuant to such benefit
plans, programs or arrangements into shares of Parent Common Stock on a basis
consistent with the transactions contemplated by this Agreement, and (ii) the
appointment of appropriate committees consisting of directors of Martin Marietta
or Lockheed, as the case may be, or Parent, if appropriate, who are not
participants in such plans, programs or arrangements. The actions to be taken by
Martin Marietta and Lockheed pursuant to this section 6.5(d) shall include the
submission of the amendments to the plans, programs or arrangements referred to
herein to their respective stockholders at the special meetings to consider this
Agreement and the Merger Agreements, if such submission is determined to be
necessary or advisable by counsel to Martin Marietta or Lockheed after
consultation with one another; provided, however, that such approval shall not
be a condition to the consummation of the Mergers.
(e) Parent shall (i) reserve for issuance the number of shares of Parent
Common Stock that will become subject to the benefit plans, programs and
agreements referred to in this Section 6.5, and (ii) issue or cause to be issued
the appropriate number of shares of Parent Common Stock pursuant to such
agreements, plans and programs, upon the exercise or maturation of rights
existing thereunder on the Merger Date or thereafter granted or awarded.
SECTION 6.6 Further Assurances. Subject to the terms and conditions
provided herein, each of the parties agrees to use its reasonable efforts to
take, or cause to be taken, all action and to do, or cause to be done, all
things necessary, proper or advisable under applicable law and regulation to
consummate and make effective the Mergers in accordance with the terms of this
Agreement and the Merger Agreements, subject, however, to the vote of
stockholders of Martin Marietta and Lockheed in accordance with Article II. In
case at any time after the Merger Date any further action is necessary or
desirable to carry out the purposes of this Agreement or the Merger Agreements,
the proper officers or directors of Martin Marietta and Lockheed shall take all
such necessary action.
SECTION 6.7 No Solicitation. Unless and until this Agreement shall have
been terminated by either party pursuant to Section 8.1, neither Martin Marietta
nor Lockheed nor any of their respective officers,
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directors or agents shall directly or indirectly, encourage, solicit or initiate
discussions or negotiations with, or, unless its Board of Directors has
determined that it is required to do so in order to comply with its fiduciary
duty under applicable law (as advised by counsel in writing), engage in
negotiations or discussions with, or provide any nonpublic information to, any
corporation, partnership, person or other entity or group (other than to Martin
Marietta or Lockheed or an affiliate or an associate of either Martin Marietta
or Lockheed) concerning any merger, sale of substantial assets, sale of shares
of capital stock or similar transactions involving Martin Marietta or Lockheed
or any of their respective Subsidiaries or divisions. In the event Martin
Marietta or Lockheed shall receive any proposal concerning any such transaction,
such party shall promptly advise the other as to such proposal and as to any
discussions conducted in connection therewith.
SECTION 6.8 Public Announcements. Martin Marietta and Lockheed will
consult with each other before issuing any press release relating to this
Agreement or the transactions contemplated herein and shall not issue any such
press release prior to such consultation, except as may be required by law or by
obligations pursuant to any listing agreement with any national securities
exchange.
SECTION 6.9 Agreements with Respect to Martin Marietta Common Stock and
Lockheed Common Stock. (a) Martin Marietta agrees that it will, and will use
its reasonable efforts to the end that its Subsidiaries will, (i) not tender
into any tender or exchange offer or sell, transfer or otherwise dispose of any
shares of the voting capital stock of Lockheed ("Lockheed Voting Stock") which
they own, (ii) vote all shares of Lockheed Voting Stock owned by them in favor
of the transactions contemplated by this Agreement and (iii) vote all shares of
Lockheed Voting Stock owned by them against any merger, consolidation, business
combination, or other extraordinary corporate transaction (including without
limitation any reclassification of securities, recapitalization, sale, lease,
exchange or other disposition of all or substantially all of its respective
assets, issuance of securities in exchange for cash or securities or other
property, liquidation or dissolution) involving Lockheed other than the
transactions contemplated by this Agreement.
(b) Lockheed agrees that it will, and will use its reasonable efforts to
the end that its Subsidiaries will, (i) not tender into any tender or exchange
offer or sell, transfer or otherwise dispose of any shares of the voting capital
stock of Martin Marietta ("Martin Marietta Voting Stock") which they own, (ii)
vote all shares of Martin Marietta Voting Stock owned by them in favor of the
transactions contemplated by this Agreement and (iii) vote all shares of Martin
Marietta Voting Stock owned by them against any merger, consolidation, business
combination or other extraordinary corporate transaction (including without
limitation any reclassification of securities, recapitalization, sale, lease,
exchange or other disposition of all or substantially all of its respective
assets, issuance of securities in exchange for cash or securities or other
property, liquidation or dissolution) involving Martin Marietta other than the
transactions contemplated by this Agreement.
SECTION 6.10 Indemnification and Insurance. For a period of six years
after the Merger Date, Parent shall cause to be maintained in effect (a) the
current provisions regarding indemnification of officers and directors contained
in the charter and bylaws of Martin Marietta and the certificate of
incorporation and bylaws and officers and directors indemnification agreements
of Lockheed, and (b) the current policies of directors' and officers' liability
insurance and fiduciary liability insurance maintained by Martin Marietta and
Lockheed (provided that Parent may substitute therefor policies of at least the
same coverage and amounts containing terms and conditions which are, in the
aggregate, no less advantageous to the insured) with respect to claims arising
from facts or events which occurred on or before the Merger Date.
SECTION 6.11 Accountants' "Comfort" Letters. Martin Marietta and Lockheed
will each use reasonable efforts to cause to be delivered to each other letters
from their respective independent accountants, dated a date within two business
days before the date of the Registration Statement, in form and substance
reasonably satisfactory to the recipient and customary in scope and substance
for comfort letters delivered by independent accountants in connection with
registration statements on Form S-4.
SECTION 6.12 Additional Reports. Martin Marietta and Lockheed shall each
furnish to the other copies of any reports of the type referred to in Sections
4.4 and 5.4 which it files with the SEC on or after the date hereof, and Martin
Marietta or Lockheed, as the case may be, represents and warrants that as of the
respective dates thereof, such reports will not contain any untrue statement of
a material fact or omit to state a material fact required to be stated therein
or necessary to make the statement therein, in light of the
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circumstances under which they were made, not misleading. Any unaudited
consolidated interim financial statements included in such reports (including
any related notes and schedules) will fairly present the financial position of
Martin Marietta and its consolidated Subsidiaries or Lockheed and its
consolidated Subsidiaries, as the case may be, as of the dates thereof and the
results of operations and changes in financial position or other information
included therein for the periods or as of the date then ended (subject, where
appropriate, to normal year-end accrual adjustments), in each case in accordance
with past practice and GAAP consistently applied during the periods involved
(except as otherwise disclosed in the notes thereto).
ARTICLE VII
CONDITIONS TO THE MERGERS
SECTION 7.1 Conditions to Both Mergers. The obligation of Martin Marietta
to effect the Atlantic Sub Merger and the obligation of Lockheed to effect the
Pacific Sub Merger shall each be subject to the simultaneous effectuation by the
other of the Merger to which the other is a party and to the following
additional conditions:
(a) The holders of shares of Martin Marietta Common Stock and Martin
Marietta Preferred Stock, voting together as a single class shall have duly
approved this Agreement and the Atlantic Sub Merger Agreement, and holders
of shares of Lockheed Common Stock shall have duly approved this Agreement
and the Pacific Sub Merger Agreement, all in accordance with applicable
law.
(b) No statute, rule, regulation, executive order, decree, or
injunction shall have been enacted, entered, promulgated or enforced by any
court or governmental authority which prohibits the consummation of either
of the Mergers substantially on the terms contemplated hereby.
(c) The Registration Statement shall have become effective in
accordance with the provisions of the Securities Act, and no stop order
suspending such effectiveness shall have been issued and remain in effect.
(d) The shares of Parent Common Stock issuable in the Mergers shall
have been approved for listing on the NYSE upon official notice of
issuance.
(e) Any applicable waiting period under the HSR Act shall have expired
or been terminated and the other Martin Marietta Required Statutory
Approvals and other Lockheed Required Statutory Approvals shall have been
obtained at or prior to the Merger Date, except where the failure to obtain
such other Martin Marietta Required Statutory Approvals or other Lockheed
Required Statutory Approvals would not have a material adverse effect on
the transactions contemplated hereby or on the business, results of
operations or financial condition of Martin Marietta and its Subsidiaries
taken as a whole or Lockheed and its Subsidiaries taken as a whole, as the
case may be.
(f) Each of Martin Marietta and Lockheed shall have received a letter
of its independent public accountants, dated the Merger Date, in form and
substance reasonably satisfactory to it, stating that, they concur with
management's conclusion that the transactions effected pursuant to Article
I of this Agreement will qualify as transactions to be accounted for in
accordance with the pooling of interests method of accounting under the
requirements of APB No. 16.
(g) Each of Martin Marietta and Lockheed shall have received an
opinion of its tax counsel, in form and substance reasonably satisfactory
to it, and dated within five days of the date of the Joint Proxy Statement,
to the effect that neither it, nor any of its stockholders shall recognize
gain or loss for Federal income tax purposes as a result of the Merger to
which it is a party (other than in respect of any cash paid in lieu of
fractional shares), which opinion shall have been re-confirmed as of the
Merger Date.
SECTION 7.2 Conditions to Obligations of Martin Marietta to Effect the
Atlantic Sub Merger. The obligation of Martin Marietta to effect the Atlantic
Sub Merger is further subject to the conditions that the representations and
warranties of Lockheed contained herein shall in all material respects be true
as of the Merger Date with the same effect as though made as of the Merger Date
(except for changes specifically
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permitted by the terms of this Agreement); Lockheed shall in all material
respects have performed all obligations and complied with all covenants required
by this Agreement to be performed or complied with by it prior to the Merger
Date; and Lockheed shall have delivered to Martin Marietta a certificate, dated
the Merger Date and signed by its Chairman of the Board and Chief Executive
Officer or President to both such effects.
SECTION 7.3 Conditions to Obligations of Lockheed to Effect the Pacific
Sub Merger. The obligation of Lockheed to effect the Pacific Sub Merger is
further subject to the conditions that the representations and warranties of
Martin Marietta contained herein shall in all material respects be true as of
the Merger Date with the same effect as though made as of the Merger Date
(except for changes specifically permitted by the terms of this Agreement);
Martin Marietta shall in all material respects have performed all obligations
and complied with all covenants required by this Agreement to be performed or
complied with by it prior to the Merger Date; and Martin Marietta shall have
delivered to Lockheed a certificate, dated the Merger Date and signed by its
Chairman of the Board and Chief Executive Officer or President to both such
effects.
ARTICLE VIII
TERMINATION, WAIVER, AMENDMENT AND CLOSING
SECTION 8.1 Termination or Abandonment. Notwithstanding anything
contained in this Agreement to the contrary, this Agreement may be terminated
and abandoned at any time prior to the Merger Date, whether before or after
approval of this Agreement and the Merger Agreements by the respective
stockholders of Martin Marietta and Lockheed:
(a) by the mutual written consent of Martin Marietta and Lockheed;
(b) by Martin Marietta or Lockheed if the Merger Date shall not have
occurred on or before February 15, 1995;
(c) by Martin Marietta or Lockheed if any court of competent
jurisdiction in the United States or other United States governmental body
shall have issued an order, decree or ruling or taken any other action
restraining, enjoining or otherwise prohibiting the Mergers on
substantially the terms contemplated by this Agreement and such order,
decree, ruling or other action shall have become final and non-appealable;
(d) by Martin Marietta if (i) the Board of Directors of Lockheed shall
have altered its determination to recommend that the stockholders of
Lockheed approve this Agreement or (ii) any third party or group shall have
acquired, after the date of this Agreement, beneficial ownership of 15% or
more of the outstanding shares of Lockheed Common Stock;
(e) by Lockheed if (i) the Board of Directors of Martin Marietta shall
have altered its determination to recommend that the stockholders of Martin
Marietta approve this Agreement or (ii) any third party or group shall have
acquired, after the date of this Agreement, beneficial ownership of 15% or
more of the outstanding shares of Martin Marietta Common Stock;
(f) by Lockheed or Martin Marietta if there shall have been a material
breach by the other of any of its representations, warranties, covenants or
agreements contained in this Agreement and such breach shall not have been
cured within 30 days after notice thereof shall have been received by the
party alleged to be in breach; or
(g) by Martin Marietta or Lockheed if, other than as a result of a
breach by it, it reasonably concludes that any of the conditions to its
obligations hereunder set forth in Section 7.1(b) through (g) shall have
become impossible of fulfillment.
In the event of termination of this Agreement pursuant to this Section 8.1, this
Agreement shall terminate (except for the last sentence of Section 6.2 and
Sections 8.2, 8.3 and 9.2), and there shall be no other liability on the part of
Martin Marietta or Lockheed to the other except liability arising out of a
wilful breach of this Agreement.
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SECTION 8.2 Termination Fee. In the event of a termination by Martin
Marietta under Section 8.1(d)(i) following receipt by Lockheed of an Acquisition
Proposal, or under Section 8.1(d)(ii), or a termination by Lockheed under
Section 8.1(e)(i) following receipt by Martin Marietta of an Acquisition
Proposal, or under Section 8.1(e)(ii), the terminating party shall be paid by
wire transfer in immediately available funds a fee of $100 million by the other
party within two business days of such termination. For purposes of this Section
8.2 and Section 8.3 below, Parent shall be deemed not to be a party to this
Agreement. For purposes of this Agreement, the term "Acquisition Proposal" shall
mean any bona fide proposal made by a third party to (i) acquire beneficial
ownership (as defined under Rule 13(d) of the Exchange Act) of a majority equity
interest in either Martin Marietta or Lockheed pursuant to a merger,
consolidation or other business combination, sale of shares of capital stock,
tender offer or exchange offer or similar transaction, including, without
limitation, any single or multi-step transaction or series of related
transactions which is structured to permit such third party to acquire
beneficial ownership of a majority or greater equity interest in Martin Marietta
or Lockheed, (ii) purchase all or substantially all of the business or assets of
Martin Marietta or Lockheed or (iii) otherwise effect a business combination
involving Martin Marietta or Lockheed.
SECTION 8.3 Expense Reimbursement. In the event Martin Marietta or
Lockheed fails to recommend the transaction contemplated hereby to its
stockholders, or withdraws any such recommendation previously made and the
Mergers are not consummated, such party shall (unless a fee shall have become
payable under Section 8.2 or unless such failure to recommend or such withdrawal
shall have been a result of a breach hereof by the other party) at the time of
termination of this Agreement pay to the other party an amount equal to such
other party's actual costs and expenses incurred in connection herewith,
provided that such reimbursement shall not exceed $15 million.
SECTION 8.4 Amendment or Supplement. At any time before or after approval
of this Agreement and the Merger Agreements by the respective stockholders of
Martin Marietta and Lockheed and prior to the Merger Date, this Agreement may be
amended or supplemented in writing by Martin Marietta and Lockheed with respect
to any of the terms contained in this Agreement, except that following approval
by the stockholders of Martin Marietta and Lockheed there shall be no amendment
or change to the provisions hereof with respect to the conversion ratio of
shares of Martin Marietta Common Stock, Martin Marietta Preferred Stock or
Lockheed Common Stock into shares of Parent Common Stock and Parent Preferred
Stock as provided herein nor any amendment or change not permitted under
applicable law, without further approval by the stockholders of Martin Marietta
and Lockheed.
SECTION 8.5 Extension of Time, Waiver, Etc. At any time prior to the
Merger Date, Martin Marietta and Lockheed may:
(a) extend the time for the performance of any of the obligations or
acts of the other party;
(b) waive any inaccuracies in the representations and warranties of
the other party contained herein or in any document delivered pursuant
hereto; or
(c) waive compliance with any of the agreements or conditions of the
other party contained herein; provided, however, that no failure or delay
by Martin Marietta or Lockheed in exercising any right hereunder shall
operate as a waiver thereof nor shall any single or partial exercise
thereof preclude any other or further exercise thereof or the exercise of
any other right hereunder. Any agreement on the part of a party hereto to
any such extension or waiver shall be valid only if set forth in an
instrument in writing signed on behalf of such party.
SECTION 8.6 Closing. The closing of the transactions contemplated by this
Agreement and the Merger Agreements shall take place at the offices of Dewey
Ballantine, 1301 Avenue of the Americas, New York, New York at 10:00 A.M., local
time, on the Merger Date or at such other time and place as Martin Marietta and
Lockheed shall agree.
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ARTICLE IX
MISCELLANEOUS
SECTION 9.1 No Survival of Representations and Warranties. None of the
representations, warranties and agreements in this Agreement or in any
instrument delivered pursuant to this Agreement shall survive the Mergers,
except for the agreements set forth in Article III, the agreements of
"affiliates" of Martin Marietta and Lockheed to be delivered pursuant to Section
6.4, and the provisions of Section 6.5, the last sentence of Section 6.6, and
the provisions of Section 6.10.
SECTION 9.2 Expenses. Except as provided in Section 8.3 above, whether or
not the Mergers are consummated, all costs and expenses incurred in connection
with this Agreement, the Merger Agreements and the transactions contemplated
hereby and thereby shall be paid by the party incurring such expenses, except
that the expenses incurred in connection with printing the Joint Proxy Statement
and any expenses incurred by Parent relating to the issuance, registration and
listing of the Parent Common Stock and the Parent Preferred Stock and the
qualification thereof under state blue sky or securities laws, shall be paid in
equal shares by Martin Marietta and Lockheed.
SECTION 9.3 Counterparts. This Agreement may be executed in two or more
counterparts, all of which shall be considered the same agreement.
SECTION 9.4 Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York, without regard
to the principles of conflicts of laws thereof.
SECTION 9.5 Notices. All notices and other communications hereunder shall
be in writing and shall be deemed given if delivered by hand or mailed by
registered or certified mail (return receipt requested) to the parties at the
following addresses (or at such other addresses for a party as shall be
specified by like notice) and shall be deemed given on the date on which so
hand-delivered or on the third business day following the date on which so
mailed:
To Martin Marietta:
Martin Marietta Corporation
6801 Rockledge Drive
Bethesda, Maryland 20817
Attention: Frank H. Menaker, Jr., Esq.
copy to:
Leonard P. Larrabee, Jr., Esq.
Dewey Ballantine
1301 Avenue of the Americas
New York, New York 10019
To Lockheed:
Lockheed Corporation
4500 Park Granada Blvd.
Calabasas, California 91399
Attention: William T. Vinson, Esq.
copy to:
C. Douglas Kranwinkle, Esq.
O'Melveny & Myers
153 E. 53rd Street
New York, New York 10022
SECTION 9.6 Miscellaneous. This Agreement:
(a) along with the Confidentiality Agreement and the Merger Agreements
constitutes the entire agreement, and supersedes all other prior agreements
and understandings, both written and oral, between the parties, or any of
them, with respect to the subject matter hereof and thereof; and
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(b) except for the provisions of Section 6.10 hereof, is not intended
to and shall not confer upon any person other than the parties hereto any
rights or remedies hereunder; and
(c) shall not be assignable by operation of law or otherwise. The
headings contained in this Agreement are for reference purposes and shall
not affect in any way the meaning or interpretation of this Agreement.
SECTION 9.7 Subsidiaries; Significant Subsidiaries. When a reference is
made in this Agreement to subsidiaries of Martin Marietta or Lockheed, the word
"Subsidiaries" means any corporation of which more than 50% on the date hereof
of the outstanding voting securities are directly or indirectly owned by Martin
Marietta or Lockheed (as the case may be). When a reference is made in this
Agreement to Significant Subsidiaries, the words "Significant Subsidiaries"
shall refer to Subsidiaries (as defined above) which constitute "significant
subsidiaries" under Rule 405 promulgated by the SEC under the Securities Act.
SECTION 9.8 Finders or Brokers. Except for Bear, Stearns & Co. Inc. with
respect to Martin Marietta, and Morgan Stanley & Co. Incorporated with respect
to Lockheed, neither Martin Marietta nor Lockheed has employed any investment
banker, broker, finder or intermediary in connection with the transactions
contemplated hereby who might be entitled to any fee or any commission in
connection with or upon consummation of the Mergers.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered as of the date first above written.
MARTIN MARIETTA CORPORATION
By: /s/ MARCUS C. BENNETT
----------------------------------
Name: Marcus C. Bennett
Title: Senior Vice Preident and
Chief Financial
Officer
LOCKHEED CORPORATION
By: /s/ VINCENT N. MARAFINO
----------------------------------
Name: Vincent N. Marafino
Title: Vice Chairman of the Board
and Chief Financial and
Administrative Officer
PARENT CORPORATION
By: /s/ JOHN E. MONTAGUE
----------------------------------
Name: John E. Montague
Title: Vice President and
Treasurer
In accordance with Item 601(b)(2) of Regulation S-K, the exhibits
described in the Table of Contents of this Exhibit 2.1 have not been filed.
The Registrant hereby agrees to furnish supplementally copies of such
exhibits to the Commission upon request.
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