TENDER AGREEMENT
TENDER AGREEMENT (this "Agreement"), dated as of March 1, 1999, among
L-3 Communications Corporation, a Delaware corporation ("Parent"), and the other
parties set forth on the signature page hereof (collectively, the
"Stockholders").
RECITALS
Concurrently herewith, Parent, Angel Acquisition Corp., a Delaware
corporation and a direct, wholly owned subsidiary of Parent ("Sub"), and Aydin
Corporation, a Delaware corporation (the "Company"), are entering into an
Agreement and Plan of Merger, dated as of the date hereof (the "Merger
Agreement"; capitalized terms used but not defined herein shall have the
meanings set forth in the Merger Agreement), pursuant to which Sub agrees to
make an offer (the "Offer") for all outstanding share of common stock, par value
$1.00 per share (the "Common Stock"), of the Company, at a price of $13.50 per
share (the "Offer Price"), net in cash, to be followed by a merger (the
"Merger") of Sub with and into the Company.
As a condition to their willingness to enter into the Merger Agreement
and make the Offer, Parent and Sub have required that the Stockholders agree,
and the Stockholders have agreed, among other things, to tender the number of
shares of Common Stock of each Stockholder set forth on Annex A hereto, together
with any additional shares when and if they are acquired (such shares, and any
additional shares when and if they are acquired, being referred to herein as the
"Shares") pursuant to the Offer and not withdraw any Shares therefrom on the
terms and conditions provided for herein.
The Board of Directors of the Company has exempted this Agreement, the
Merger Agreement and the transactions contemplated hereby and thereby so as to
render inapplicable Section 203 of the Delaware General Corporation Law ("DGCL")
to the transactions contemplated hereby and thereby.
AGREEMENT
To implement the foregoing and in consideration of the mutual
agreements contained herein, the parties agree as follows:
1. Agreement to Tender. The Stockholders hereby agree to validly tender
(or cause the record owner to validly tender) all of their Shares pursuant to
and in accordance with the terms of the Offer and not withdraw any Shares
therefrom.
2. Voting of Shares. Each Stockholder hereby agrees to (a) vote the Shares
in favor of the approval of the Merger Agreement; (b) vote the Shares against
any action or agreement that would result in a breach in any material respect of
any covenant, representation or warranty or any other obligation or agreement of
the Company under the Merger Agreement; and (c) vote the Shares against any
action or agreement (other than the Merger Agreement or the transactions
contemplated thereby) that would impede, interfere with, delay, postpone or
attempt to
discourage the Merger or the Offer. Each Stockholder shall not hereafter purport
to vote (or execute a consent with respect to) such Shares (other than in
accordance with the requirements of this Section 2) or grant any other proxy or
power of attorney with respect to any Shares, deposit any Shares into a voting
trust or enter into any agreement (other than this Agreement), arrangement or
understanding with any person, directly or indirectly, to vote, grant any proxy
or give instructions with respect to the voting of such Shares.
3. Representations and Warranties.
3.1. Representations and Warranties of Parent. Parent hereby represents and
warrants to the Stockholders as follows:
(a) Due Authorization. The execution and delivery of this Agreement and
the consummation of the transactions contemplated hereby have been duly and
validly authorized by the Board of Directors of Parent, and no other corporate
proceedings on the part of Parent are necessary to authorize this Agreement or
to consummate the transactions contemplated hereby. This Agreement has been duly
and validly executed and delivered by Parent and constitutes a valid and binding
agreement of Parent, enforceable against Parent in accordance with its terms,
except that such enforceability (i) may be limited by bankruptcy, insolvency,
moratorium or other similar laws affecting or relating to enforcement of
creditors' rights generally and (ii) is subject to general principles of equity.
(b) No Conflicts. Except for (i) filings under the HSR Act, if
applicable, (ii) the applicable requirements of the Exchange Act and the
Securities Act, (iii) the applicable requirements of state securities, takeover
or blue sky laws and (iv) such notifications, filings, authorizing actions,
orders and approvals as may be required under other laws, no filing with, and no
permit, authorization, consent or approval of any state, federal, foreign public
body or authority is necessary for the execution of this Agreement by Parent.
(c) Good Standing. Parent is a corporation duly organized, validly
existing and in good standing under the laws of Delaware and has all requisite
corporate power and authority to execute and deliver this Agreement.
3.2. Representations and Warranties of Stockholders. Each Stockholder,
individually and solely as to itself hereby represents and warrants to Parent
as follows:
(a) Ownership of Shares. Each Stockholder is the record or beneficial
owner of the Shares set forth opposite its name on Annex A hereto and has the
power to vote and dispose of such Shares. To each Stockholder's knowledge, such
Shares are validly issued, fully paid and nonassessable, with no personal
liability attaching to the ownership thereof. Each Stockholder has good title to
the Shares, free and clear of any agreements, liens, adverse claims or
encumbrances whatsoever with respect to the ownership of or the right to vote
such Shares.
(b) Power; Binding Agreement. Each Stockholder has the legal capacity,
power and authority to enter into and perform all of its obligations under this
Agreement. The execution, delivery and performance of this Agreement by each
Stockholder will not violate any other agreement to which such Stockholder is a
party including, without limitation, any voting agreement, stockholders
agreement or voting trust. This Agreement has been duly and validly authorized,
executed and delivered by each Stockholder and constitutes a valid and binding
agreement of each Stockholder, enforceable against each Stockholder in
accordance with its terms, except that such enforceability (i) may be limited by
bankruptcy, insolvency, moratorium or other similar laws affecting or relating
to enforcement of creditors' rights generally and (ii) is subject to general
principles of equity.
(c) No Conflicts. Except for (i) filings under the HSR Act, if
applicable, (ii) the applicable requirements of the Exchange Act and the
Securities Act, (iii) the applicable requirements of state securities, takeover
or blue sky laws and (iv) such notifications, filings, authorizing actions,
orders and approvals as may be required under other laws, (A) no filing with,
and no permit, authorization, consent or approval of, any state, federal or
foreign public body or authority is necessary for the execution of this
Agreement by each Stockholder and the consummation by each Stockholder of the
transactions contemplated hereby and (B) neither the execution and delivery of
this Agreement by each Stockholder nor the consummation by each Stockholder of
the transactions contemplated hereby nor compliance by each Stockholder with any
of the provisions hereof shall (1) conflict with or result in any breach of any
provision of the certificate of incorporation, by-laws, trust or charitable
instruments (or similar documents) of such Stockholder, (2) result in a
violation or breach of, or constitute (with or without notice or lapse of time
or both) a default (or give rise to any third party right of termination,
cancellation, material modification or acceleration) under any of the terms,
conditions or provisions of any note, bond, mortgage, indenture, license,
contract, agreement or other instrument or obligation to which such Stockholder
is a party or by which they or any of their properties or assets may be bound or
(3) violate any order, writ, injunction, decree, statute, rule or regulation
applicable to such Stockholder or any of his or its properties or assets, except
in the case of (2) or (3) for violations, breaches or defaults which would not
in the aggregate materially impair the ability of such Stockholder to perform
its obligations hereunder.
4. Certain Covenants of Stockholder. Each Stockholder hereby covenants and
agrees, individually and solely, as to itself as follows:
4.1. No Solicitation. No Stockholder nor any employee, representative or
agent of any Stockholder shall, directly or indirectly, encourage, solicit,
participate in or initiate discussions or negotiations with, or provide any
information to, any corporation, partnership, person or other entity or group
(other than Parent and Sub, any affiliate or associate of Parent and Sub or any
designees of Parent or Sub) concerning any merger, sale of all or any material
portion of the assets, sale of shares of capital stock or similar transactions
(including an exchange of stock or assets) involving the Company or any
subsidiary or division of the Company. If any Stockholder, or any employee,
representative or agent of any Stockholder, receives an inquiry or proposal with
respect to the sale of Shares, then such Stockholder shall promptly inform
Parent
of the terms and conditions, if any, of such inquiry or proposal and the
identity of the person making it. Each Stockholder shall, and shall cause his or
its employees, representatives and agents to, immediately cease and cause to be
terminated any existing activities, discussions or negotiations with any parties
conducted heretofore with respect to any of the foregoing.
4.2. Restriction on Transfer and NonInterference. Each Stockholder hereby
agrees, while this Agreement is in effect, and except as contemplated hereby,
not to (a) sell, transfer, pledge, encumber, assign or otherwise dispose of, or
enter into any contract, option or other arrangement or understanding with
respect to the sale, transfer, pledge, encumbrance, assignment or other
disposition of, any Shares; provided that any Stockholder may transfer Shares to
any other Stockholder; provided further that as a condition to such transfer,
such other Stockholder agrees in writing on terms reasonably acceptable to
Parent to become a party to, and agrees to be bound by, to the same extent as
the transferring Stockholder, the terms of this Agreement or (b) take any action
that would make any representation or warranty of such Stockholder contained
herein untrue or incorrect or have the effect of preventing or disabling such
Stockholder from performing or its obligations under this Agreement.
4.3. Legending of Certificates; Nominees Shares. If requested by Parent, the
Stockholders agree to submit to Parent contemporaneously with or promptly
following execution of this Agreement all certificates representing their Shares
so that Parent may note thereon a legend referring to the rights granted to it
by this Agreement. If any of the Shares beneficially owned by the Stockholders
are held of record by a brokerage firm in "street name" or in the name of any
other nominee (a "Nominee," and, as to such Shares, "Nominee Shares"), the
Stockholders agree that, upon written notice by Parent requesting it, the
Stockholders will within five days of the giving of such notice execute and
deliver to Parent a limited power of attorney in such form as shall be
reasonably satisfactory to Parent solely to enable Parent to require the Nominee
to (i) enter into an agreement to the same effect as Section 2 hereof with
respect to the Nominee Shares held by such Nominee, (ii) tender such Nominee
Shares in the Offer pursuant to Section 1 hereof and (iii) submit to Parent the
certificates representing such Nominee Shares for notation of the
above-referenced legend thereon.
4.4. Stop Transfer Order. In furtherance of this Agreement, concurrently
herewith, the Stockholders shall and hereby do authorize the Company's counsel
to notify the Company's transfer agent that, except as permitted pursuant to
Section 4.2 of this Agreement, there is a stop transfer order with respect to
all of the Shares (and that this Agreement places limits on the transfer of such
Shares).
5. Further Assurances. From time to time, at the other party's request and
without further consideration, each party hereto shall execute and deliver such
additional documents and take all such further action as may be necessary or
desirable to consummate the transactions contemplated by this Agreement.
6. Adjustments to Prevent Dilution. In the event of a stock dividend or
distribution, or any change in the Company's Common Stock by reason of any stock
dividend, split-up,
reclassification, recapitalization, combination or the exchange of shares, the
term "Shares" shall be deemed to refer to and include the Shares as well as all
such stock dividends and distributions and any shares into which or for which
any or all of the Shares may be changed or exchanged. In such event, the
definitions of "Set Amount" and "Initial Amount" shall be proportionally
adjusted.
7. Miscellaneous.
7.1 Entire Agreement; Assignment. This Agreement (i) constitutes the
entire agreement among the parties with respect to the subject matter hereof
and supersedes all other prior agreements and understandings, both written and
oral, between the parties with respect to the subject matter hereof and (ii)
shall not be assigned by operation of law or otherwise, provided that Parent
may assign its rights and obligations hereunder to any direct or indirect wholly
owned parent company or subsidiary of Parent, but no such assignment shall
relieve Parent of its obligations hereunder if such assignee does not perform
such obligations.
7.2. Amendments. This Agreement may not be modified, amended, altered or
supplemented, except upon the execution and delivery of a written agreement
executed by the parties hereto.
7.3. Notices. All notices, requests, claims, demands and other
communications hereunder shall be in writing and shall be given (and shall be
deemed to have been duly received if so given) by hand delivery, telegram,
telex or telecopy, or by mail (registered or certified mail, postage prepaid,
return receipt requested) or by any courier service, such as Federal Express,
providing proof of delivery. All communications hereunder shall be delivered to
the respective parties at the following addresses:
If to the Stockholders: c/o Steel Partners II, L.P.
150 East 52nd Street
21st Floor
New York, New York 10022
Attention: Warren G. Lichtenstein
copy to: Olshan Grundman Frome Rosenzweig & Wolosky, LLP
505 Park Avenue
New York, New York 10022
Attention: Steven Wolosky, Esq.
If to Parent: L-3 Communications Corporation
600 Third Avenue
New York, New York 10016
Attention: Christopher Cambria, Esq.
copy to: Simpson Thacher & Bartlett
425 Lexington Avenue
New York, New York 10017
Attention: William E. Curbow, Esq.
or to such other address as the person to whom notice is given may have
previously furnished to the others in writing in the manner set forth above.
7.4. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York.
7.5. Termination. This Agreement shall terminate on the earlier of (i) the
Effective Time or (ii) the termination of the Merger Agreement in accordance
with its terms.
7.6. Waiver of Dissenter's and Appraisal Rights. The Stockholders agree
that they will not exercise any rights to dissent from the Merger or request
appraisal rights of their Shares pursuant to Section 262 of the DGCL or any
other similar provisions of law in connection with the transactions contemplated
hereby.
7.7. Specific Performance. Each of the parties hereto recognizes and
acknowledges that a breach by it of any covenants or agreements contained in
this Agreement will cause the other party to sustain damages for which it would
not have an adequate remedy at law for money damages, and therefore, each of the
parties hereto agrees that in the event of any such breach the aggrieved party
shall be entitled to the remedy of specific performance of such covenants and
agreements and injunctive and other equitable relief in addition to any other
remedy to which it may be entitled, at law or in equity.
7.8. Counterparts. This Agreement may be executed in any number of separate
counterparts, each of which shall be deemed to be an original, and all of which
shall constitute one and the same agreement.
7.9. Descriptive Headings. The descriptive headings used herein are
inserted for convenience of reference only and are not intended to be part of or
to affect the meaning or interpretation of this Agreement.
7.10. Severability. Whenever possible, each provision or portion of any
provision of this Agreement will be interpreted in such manner as to be
effective and valid under applicable law but if any provision or portion of any
provision of this Agreement is held to be invalid, illegal or unenforceable in
any respect under any applicable law or rule in any jurisdiction, such
invalidity, illegality or unenforceability will not affect any other provision
or portion of any provision in such jurisdiction, and this Agreement will be
reformed, construed and enforced in such jurisdiction as if such invalid,
illegal or unenforceable provision or portion of any provision had never been
contained herein.
7.11. Duty of Directors. Nothing contained in Section 4.1 shall limit the
right of any officer, director, employee or representative of a Stockholder who
is a director of the Company from exercising his or her fiduciary responsibility
as a director, consistent with the terms of the Merger Agreement.
IN WITNESS WHEREOF, this Agreement has been executed by or on behalf of
each of the parties hereto, all as of the date first above written.
L-3 COMMUNICATIONS CORPORATION
By: /s/ Christopher C. Cambria
--------------------------
Name: Christopher C. Cambria
Title: Vice President, Secretary-General Counsel
STEEL PARTNERS II, L.P.
By: Steel Partners, L.L.C., General Partner
By: /s/ Warren G. Lichtenstein
--------------------------
Warren G. Lichtenstein, Chief Executive Officer
SANDERA PARTNERS, L.P.
By: Sandera Capital Management L.P., General Partner
By: Sandera Capital L.L.C., General Partner
By: /s/ Mark E. Schwarz
-------------------
Mark E. Schwarz, Vice President and Managing
Member
NEWCASTLE PARTNERS, L.P.
By: /s/ Mark E. Schwarz
-------------------
Mark E. Schwarz, General Partner
ANNEX A
Number of Shares
Name of Common Stock
- ---- ---------------
Steel Partners II, L.P. 492,600
Sandera Partners, L.P. 125,000
Newcastle Partners, L.P. 3,100