Exhibit 99
TCM GROUP AGREEMENT
THIS TCM GROUP AGREEMENT (the "Agreement") is made this 7th day of July,
1999, by and among Telcom-XM Investors, L.L.C., a Delaware limited liability
company ("Telcom"), Columbia XM Radio Partners, LLC, a Virginia limited
liability company ("Columbia"), Madison Dearborn Capital Partners III, L.P., a
Delaware limited partnership ("MDCP"), Madison Dearborn Special Equity III,
L.P., a Delaware limited partnership ("MDSE") and Special Advisors Fund I, LLC,
a Delaware limited liability company ("SAFI", and together with MDCP and MDSE,
"Madison"), each of Telcom, Columbia and Madison a "Party" and collectively, the
"Parties" or the "TCM Group". For all purposes of this TCM Group Agreement,
Madison shall be regarded and shall collectively have the rights of one "Party".
R E C I T A L S
WHEREAS, pursuant to that certain Note Purchase Agreement, dated as of June
7, 1999, between XM Satellite Radio Holdings Inc., a Delaware corporation
("XM"), each of the Parties and the other parties named therein (the "Note
Purchase Agreement"), each of the Parties has agreed to purchase certain Series
A Subordinated Convertible Notes ("Notes") to be issued by XM, which Notes are
convertible into shares of the Common Stock of XM ("XM Stock" and collectively
with the Notes, "XM Securities");
WHEREAS, each of the Parties shall, at the closing of the Note Purchase
Agreement, enter into a Shareholders Agreement, in a form substantially similar
to Exhibit A hereto, by and among XM, each of the Parties and the other parties
named therein (the "Shareholders Agreement") setting forth certain rights and
obligations of the TCM Group, the other purchasers of Notes and XM;
WHEREAS, each of the Parties shall also, at the closing of the Note
Purchase Agreement, enter into a Registration Rights Agreement, in a form
substantially similar to Exhibit B hereto, by and among XM, each of the Parties
and the other parties named therein (the "Registration Rights Agreement")
setting forth certain rights and obligations of the TCM Group, the other
purchasers of Notes and XM with respect to the XM Securities;
WHEREAS, the Parties wish to set forth the procedures which will govern the
exercise of the rights granted to the TCM Group in each of the Registration
Rights Agreement and the Shareholders Agreement;
WHEREAS, each of the Parties has, simultaneously with the execution of this
Agreement, entered into the Limited Liability Company Agreement of TCM, LLC (the
"LLC Agreement") pursuant to which each of the Parties has become a member of
TCM, LLC, a Delaware limited liability company (the "LLC");
WHEREAS, the Parties, as members of the LLC have consented to the LLC's
entry into an Operational Assistance Agreement with XM (the "XM Agreement")
pursuant to which the LLC will have a strategic business relationship with XM
and shall have the right, so long as the TCM group, in the aggregate, maintains
a five percent level of ownership of XM Securities, to utilize certain
"bandwidth" (as defined in the XM Agreement") licensed to XM for commercial
purposes;
NOW, THEREFORE, in consideration of the terms and conditions herein
contained and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties agree as follows:
1. Defined Terms. Capitalized terms used herein and not otherwise defined
shall have the respective meanings provided therefor in the Note Purchase
Agreement, the Shareholders Agreement or the Registration Rights Agreement, as
applicable.
2. Registration Rights Agreement.
a) Actions Requiring Majority Approval. The Parties shall each make
good faith efforts to reach unanimous decisions relating to the exercise by
the TCM Group (or any of the Parties) of any of the following rights
granted to the TCM Group in the Registration Rights Agreement.
Notwithstanding the immediately preceding sentence, the exercise of such
rights, in the absence of such a unanimous decision by the Parties, shall
only require the prior written consent of Parties holding a majority in
interest of XM Securities:
(i) the exercise of the Demand Registration rights provided for
in Section 2.1 of the Registration Rights Agreement; or
(ii) except as set forth in Section 2(c) below, the taking of any
material actions or decisions (e.g. selection of underwriters) under
the Registration Rights Agreement.
a) Expenses. Any expenses to be borne by the TCM Group pursuant to the
Registration Rights Agreement shall be shared equally by each of the
Parties.
b) Discretionary Actions. Any Party may, on its own and in its own
discretion, take any of the following actions or exercise any of the
following rights granted to it as a member of the TCM Group under the
Registration Rights Agreement:
(i) register any of its Registrable Securities pursuant to the
Shelf Registration provisions set forth in Section 2.2 of the
Registration Rights Agreement; or
(ii) register any of its Registrable Securities pursuant to the
Piggyback Registration rights provisions set forth in Section 2.3 of
the Registration Rights Agreement.
3. Shareholders Agreement.
a) XM Board Member Selection. The Parties shall each make good faith
efforts to select, by a unanimous written consent, one individual to be
their representative on the XM Board of Directors pursuant to Section 5.1
of the Shareholders Agreement (the "TCM Group Director"). Notwithstanding
the preceding sentence, in the absence of such a unanimous decision, the
Parties holding a majority in interest of XM Securities may, by written
consent, select the TCM Group Director.
b) Initial Director. The Parties hereby select Xx. Xxxxxxxx Xxxxx as
the initial TCM Group Director. Removal/Successor Directors. Removal of the
TCM Group Director and appointment of successor TCM Group Directors shall
require the approval of Parties holding a majority in interest of XM
Securities.
4. Transfers of XM Securities. In each case subject to the applicable
provisions of the Shareholders Agreement, each Party may transfer all or part of
its holdings of XM Securities, provided, however, that:
a) any transfer or assignment to an affiliate is permitted so long as
such affiliate agrees to join this Agreement as a Party;
b) subject to clause (a) above, each transferee, successor or assign
of any XM Securities shall agree to be bound by and to comply with the
terms of this TCM Group Agreement and shall document such agreement by
executing a counterpart of this Agreement prior to such transfer (however,
the failure of any such transferee to so execute this Agreement shall not
act as a waiver of the effects of this Section 4);
c) in the event any Party (a "Selling Party") intends to make a
transfer or assignment of XM Securities which would bring the TCM Group's
(in the aggregate) ownership of XM Securities below a 6% equity interest
level (on a fully diluted and as-converted basis) such Selling Party shall,
prior to effecting any such transfer, deliver or mail by certified mail or
overnight courier a written notice ("Right of First Offer Notice") to each
other Party stating its bona fide intention to sell, transfer or assign
some or all of its XM Securities (the "Offered Securities") and agrees to
negotiate in good faith with each other Party for a period of 30 days
following the date of such Right of First Offer Notice (the "Exclusivity
Period"), whereby each other Party (each a "Buying Party") shall be given
the first exclusive and irrevocable option (but not the obligation) to
purchase any or all of the Offered Securities; provided that if there is
more than one Buying Party, no Buying Party may purchase more than its
proportionate share (based on the number (or principal amount) of XM
Securities held by all Buying Parties) of the XM Securities so offered
unless one or more or the other Buying Parties elects to purchase less than
its proportionate share of the Offered Securities;
d) if the Selling Party does not agree to accept any offers (or there
are not offers made with respect to all of the Offered Securities) made by
the Buying Parties (each and any such offer, a "Purchase Offer") prior to
the expiration of the Exclusivity Period, the Selling Party shall, for a
period of 60 days from the expiration of the Exclusivity Period (the "Sale
Period"), be permitted to sell any Offered Securities not subject an
accepted Purchase Offer to a third-party buyer for a purchase price or
other consideration not equal to or lower than the highest Purchaser Offer
for any of the Offered Securities and on terms and conditions no more
favorable to such third-party buyer than those set forth in the highest
Purchaser Offer;
e) if Purchase Offers for all of the Offered Securities are accepted
by the Selling Party, the sale of such Offered Securities shall be closed
at a time and location mutually acceptable to the Selling Party and the
Buying Parties, but in no event later than thirty days following the
expiration of the Exclusivity Period;
f) the Selling Party shall, at the earliest of (x) the closing of any
sale of Offered Securities to a third party and (y) the expiration of the
Sale Period, sell to each Buying Party from which it accepted a Purchase
Offer the Offered Securities subject to such Purchase Offer;
g) any Offered Securities not subject to an accepted Purchase Offer
and not sold to a third party or a Buying Purchaser prior to the expiration
of the Sale Period shall become subject again to the provisions of Sections
4(c)-(f) hereof and any future offer of such Offered Securities or any
other XM Securities held by the Selling Party shall be made pursuant to
such provisions;
h) each Party shall, upon any attempted transfer or assignment by
another Party of any of its holdings of XM Securities in contravention of
this Agreement, have the right to take appropriate legal action, including,
but not limited to seeking an injunction or the imposition of other
equitable remedies, in order to enforce the terms of this Agreement.
4. Notices. Notices hereunder shall be sent by certified mail, return
receipt requested, hand delivery or facsimile transmission (promptly followed by
certified mail) or overnight courier as follows:
To: Telcom-XM Investors, L.L.C.
000 X. Xxxxx Xxxxxx, Xxxxx 000
Xxxxxxxxxx, XX 00000
Fax: 000-000-0000
Attn: President and General Counsel
with a copy to:
Xxxxx Xxxxxxxxxx LLP
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, XX 00000
Fax: 000-000-0000
Attn: Xxxxxxx X. Xxxxxxxx, Esq.
To: Columbia XM Radio Partners, LLC
000 Xxxxx Xxxxx Xxxxxx, Xxxxx 000
Xxxxxxxxxx, XX 00000
Fax: 000-000-0000
Attn: Xxxxx X. Xxxxxxx
with a copy to:
Xxxxxxx & Xxxxxx, LLP
000 Xxxxxxx Xxxxxx
Xxxxxx, XX 00000
Fax: 000-000-0000
Attn: Xxxxxxx X. Xxxxxxxx, Esq.
To : Madison Dearborn Capital Partners III, L.P.
Madison Dearborn Special Equity III, L.P.
Special Advisors Fund I, LLP
Three First Xxxxxxxx Xxxxx
Xxxxxxx, XX 00000
Fax: 000-000-0000
Attn: Xxxxx X. Xxxxx, Xx.
with a copy to:
Xxxxxxx & Xxxxxx, LLP
000 Xxxxxxx Xxxxxx
Xxxxxx, XX 00000
Fax: 000-000-0000
Attn: Xxxxxxx X. Xxxxxxxx, Esq.
5. Cumulative Remedies. The rights and remedies provided by this Agreement
are cumulative and the use of any one right or remedy by any party shall not
preclude or waive its right to use any or all other remedies. Said rights and
remedies are given in addition to any other rights the parties may have by law,
statute, ordinance or otherwise.
6. Binding Effect. This Agreement shall be binding upon and inure to the
benefit of all of the Parties and, to the extent permitted by this Agreement,
their successors, legal representatives and assigns.
7. Interpretation. Throughout this Agreement, nouns, pronouns and verbs
shall be construed as masculine, feminine, neuter, singular or plural, whichever
shall be applicable. All references herein to "Sections" and clauses shall refer
to corresponding provisions of this Agreement unless specified otherwise in a
particular instance.
8. Severability. The invalidity or unenforceability of any particular
provision of this Agreement shall not affect the other provisions hereof, and
this Agreement shall be construed in all respects as if such invalid or
unenforceable provision were omitted. If any provision of this Agreement shall
be declared by a court of competent jurisdiction to be invalid, illegal or
incapable of being enforced in whole or in part, such provision shall be
interpreted so as to remain enforceable to the maximum extent permissible
consistent with applicable law and the remaining conditions and provisions or
portions thereof shall nevertheless remain in full force and effect and
enforceable to the extent they are valid, legal and enforceable, and no
provisions shall be deemed dependent upon any other covenant or provision unless
so expressed herein.
9. Counterparts. This Agreement may be executed in any number of
counterparts with the same effect as if all parties hereto had signed the same
document. All counterparts shall be construed together and shall constitute one
instrument.
10. Entire Agreement. This Agreement, along with the Shareholders Agreement
and the Registration Rights Agreement, constitutes the entire agreement among
the parties hereto pertaining to the subject matter hereof and supersedes all
prior agreements and understandings pertaining thereto.
11. Governing Law. This Agreement and the rights of the parties hereunder
shall be interpreted in accordance with the laws of the State of New York, and
all rights and remedies shall be governed by such laws.
12. Amendments and Waivers. Any term of this Agreement may be amended, and
the observance of any term of this Agreement may be waived (either generally or
in a particular instance and either retroactively or prospectively) only with
the written consent of each of the Parties.
13. Specific Performance. Each Party, in addition to being entitled to
exercise all rights provided herein or granted by law, will be entitled to
specific performance of its rights under this Agreement. Each Party agrees that
monetary damages would not be adequate compensation for any loss incurred by
reason of a breach by it of the provisions of this Agreement and hereby agrees
to waive the defense in any action for specific performance that a remedy at law
would be adequate.
14. Choice of Forum; Jury Trial Waiver. IN THE EVENT THAT A JUDICIAL
PROCEEDING IS NECESSARY, THE SOLE FORUM FOR RESOLVING DISPUTES ARISING OUT OF OR
RELATING TO THIS AGREEMENT IS THE SUPREME COURT OF THE STATE OF NEW YORK IN AND
FOR THE COUNTY OF NEW YORK OR THE FEDERAL COURTS LOCATED IN SUCH STATE AND
COUNTY, AND RELATED APPELLATE COURTS. THE PARTIES HEREBY IRREVOCABLY CONSENT TO
THE JURISDICTION OF SUCH COURTS AND AGREE TO SAID VENUE.
THE PARTIES HEREBY IRREVOCABLY WAIVE ALL RIGHT TO A TRIAL BY JURY IN ANY
ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS AGREEMENT
OR ANY OTHER DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed on the date first above written.
TELCOM-XM INVESTORS, L.L.C.
By:
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Name:
Title:
COLUMBIA XM RADIO PARTNERS, LLC
By Columbia Capital LLC, its Managing Member
By:
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Name:
Title:
MADISON DEARBORN CAPITAL PARTNERS III, L.P.
By: Madison Dearborn Partners III, L.P., its
general partner
By: Madison Dearborn Partners LLC, its general
partner
By:
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Name:
Title:
MADISON DEARBORN SPECIAL EQUITY III, L.P.
By: Madison Dearborn Partners III, L.P., its
general partner
By: Madison Dearborn Partners LLC, its general
partner
By:
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Name:
Title:
SPECIAL ADVISORS FUND I, LLC
By: Madison Dearborn Partners III, L.P., its
manager
By: Madison Dearborn Partners LLC, its general
partner
By:
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Name:
Title:
EXHIBIT A
ATTACH FORM OF SHAREHOLDERS AGREEMENT
EXHIBIT B
ATTACH FORM OF REGISTRATION RIGHTS AGREEMENT
