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EXHIBIT 10.2
Draft of June 1, 1997
INTEREST EXCHANGE AGREEMENT
Dated as of June [ ], 1997
by and between
IRIDIUM WORLD COMMUNICATIONS LTD.
and
IRIDIUM LLC
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TABLE OF CONTENTS
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ARTICLE I
DEFINITIONS AND OTHER PROVISIONS
OF GENERAL APPLICABILITY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Section 1.01 Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Section 1.02 Interpretation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
ARTICLE II
EXCHANGE RIGHTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Section 2.01 General Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Section 2.02 Notice Required for Exercise
of Exchange Right . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Section 2.03 Iridium Board Authorization
Required for Exchange . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Section 2.04 Exchange; Allocation of Iridium
Board Authorization . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Section 2.05 Closing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Section 2.06 Distributions with Respect to
Class 1 Membership Interests . . . . . . . . . . . . . . . . . . . . . . . 9
Section 2.07 Restricted Securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Section 2.08 Sale by Holder . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Section 2.09 Company Covenants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Section 2.10 Special Deferral Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
ARTICLE III
EXCHANGE DATE AND EXCHANGE RATE ADJUSTMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Section 3.01 Exchange Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Section 3.02 Exchange Rate Adjustments - Company
Actions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Section 3.03 Exchange Rate Adjustments - Iridium
Actions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
Section 3.04 Exchange Rate Adjustments - General . . . . . . . . . . . . . . . . . . . . . . . . . 19
ARTICLE IV
REGISTRATION RIGHTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
ARTICLE V
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TABLE OF CONTENTS (CONT'D)
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PROCEDURE FOR REGISTRATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
Section 5.01 Registration Statement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
Section 5.02 Registration of Additional Shares . . . . . . . . . . . . . . . . . . . . . . . . . . 27
Section 5.03 Deferral Period . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
Section 5.04 Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
Section 5.05 Listing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
ARTICLE VI
RULE 144 INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
ARTICLE VII
EQUAL TREATMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
ARTICLE VIII
INDEMNIFICATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
Section 8.01 Indemnification by Iridium . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
Section 8.02 Indemnification by Registering Holders . . . . . . . . . . . . . . . . . . . . . . . . 29
Section 8.03 Proceedings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
Section 8.04 Contribution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
ARTICLE IX
REPRESENTATIONS AND WARRANTIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
Section 9.01 Representations and Warranties
of the Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
Section 9.02 Representations, Warranties and
Agreements of the Holders and
the Registering Holders . . . . . . . . . . . . . . . . . . . . . . . . . . 32
ARTICLE X
EFFECTIVENESS OF AGREEMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
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TABLE OF CONTENTS (CONT'D)
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ARTICLE XI
ASSIGNABILITY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
ARTICLE XII
MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
Section 12.01 Successors and Assigns . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
Section 12.02 Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
Section 12.03 Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
Section 12.04 Entire Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
Section 12.05 Governing Law; Severability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
Section 12.06 Amendments to the Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
Section 12.07 Jurisdiction and Service of Process . . . . . . . . . . . . . . . . . . . . . . . . . 35
Annexes
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Annex A Letter of Representations
Annex B Form of Restricted Securities Certificate
Annex C Notice of Exchange Authorization
Annex D Registration Notice
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INTEREST EXCHANGE AGREEMENT
This INTEREST EXCHANGE AGREEMENT, dated as of JUNE [ ], 1997,
is made by and between IRIDIUM WORLD COMMUNICATIONS LTD. (the "Company"), a
company incorporated under the laws of Bermuda and IRIDIUM LLC ("Iridium"), a
limited liability company organized under the laws of the State of Delaware.
The parties hereto agree as follows:
I. Definitions and Other Provisions of General
Applicability.
Section 1.01. Definitions. As used in this Agreement,
the following terms have the following respective meanings:
"Agreement" means this Interest Exchange Agreement.
"Business Day" means a day other than a Saturday, Sunday,
national or New York State holiday or other day on which commercial banks in
New York City are authorized or required by law to close.
"Class A Common Stock" means Class A Common Stock, par value
$.01 per share, of the Company.
"Class B Common Stock" means Class B Common Stock, par value
$.01 per share, of the Company.
"Class A Holder" means a person that is the holder of record
of Class A Common Stock received by that person upon the exchange of Class 1
Membership Interests pursuant to this Agreement.
"Class 1 Membership Interests" means Class 1 Membership
Interests of Iridium.
"Closing" shall have the meaning assigned thereto in Section
2.05.
"Closing Price" means, for each Trading Day, the last reported
sale price regular way or, in case no such reported sale takes place on such
day, the average of the reported closing bid and asked prices regular way, in
either case on the principal national securities exchange on which the Class A
Common Stock is listed or admitted to trading,
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or, if the Class A Common Stock is not so listed or admitted to trading on a
national securities exchange, on the NASDAQ National Market System or, if the
Class A Common Stock is not quoted on the NASDAQ National Market System, the
average of the closing bid and asked prices in the over-the-counter market as
furnished by any New York Stock Exchange member firm selected from time to time
by Iridium for that purpose or, if the Class A Common Stock is not traded in
the over-the-counter market, the fair market value per share of the Class A
Common Stock as determined by the Iridium Board (whose determination shall be
conclusive).
"Commission" means the Securities and Exchange Commission, or
any other federal agency at the time administering the Exchange Act or the
Securities Act, whichever is the relevant statute for the particular purpose.
"Common Stock" means the Class A Common Stock, the Class B
Common Stock and any stock of any class of the Company which has no preference
in respect of dividends or amounts payable in the event of any voluntary or
involuntary liquidation, dissolution or winding-up of the Company and which is
not subject to redemption by the Company. However, shares issuable on exchange
of Class 1 Membership Interests, and subject to the rights of Holders granted
in Article IV, shall include only shares of the class designated as Class A
Common Stock of the Company on the date hereof, or shares of any class or
classes resulting from any reclassification thereof and which have no
preferences in respect of dividends or amounts payable in the event of any
voluntary or involuntary liquidation, dissolution or winding-up of the Company
and which are not subject to redemption by the Company; provided that, if at
any time there shall be more than one such resulting class, the shares of each
such class then so issuable and registerable shall be substantially in the
proportion which the total number of shares of such class resulting from all
such reclassification bears to the total number of shares of all such classes
resulting from all such reclassification.
"Company" shall have the meaning set forth in the preamble and
shall also include the Company's successors.
"Company Board" means the Board of Directors of the Company.
"Company Certificate" shall have the meaning set forth in
Section 5.03.
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"Deemed Outstanding Class A Shares" means all shares of Class
A Common Stock actually outstanding and the aggregate number of shares of Class
A Common Stock issuable under this Agreement in exchange for Class 1 Membership
Interests at the then applicable Exchange Rate, assuming for this purpose that
the Class 1 Membership Interests are then exchangeable.
"Exchange Act" means the Securities Exchange Act of 1934, or
any successor thereto, as the same shall be amended from time to time.
"Exchange Act Documents" shall have the meaning assigned
thereto in Section 5.01(a)(vii).
"Exchange Date" shall have the meaning assigned thereto in
Article III.
"Exchange Notice" shall have the meaning assigned thereto in
Section 2.02.
"Exchange Rate" shall have the meaning assigned thereto in
Section 2.01.
"Exchange Window Period" means the period commencing on the
date of commencement by Iridium of a Notice Distribution and ending on the
thirtieth day following such date.
"Exchanging Holder" shall have the meaning assigned thereto in
Section 2.02.
"Final Required Transfer Date" shall have the meaning assigned
thereto in Section 2.03.
"Gateway Authorization Agreement" shall have the meaning
assigned thereto in Article XII of the LLC Agreement.
"Holder" means any person that is the record owner of Class 1
Membership Interests.
"Indemnified Person" means, with respect to indemnification by
Iridium, the Company and each of its directors and officers, each Registering
Holder, such Holder's directors and officers, and each other person (including
each underwriter) who participated in the offering of Registerable Securities
and each other
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person, if any, who controls the Company or such Registering Holder or such
participant within the meaning of the Securities Act, and with respect to
indemnification by a Registering Holder, the Company, Iridium, each of their
officers and directors and each person, if any, who controls any of them within
the meaning of the Securities Act.
"Iridium" shall have the meaning set forth in the preamble and
shall also include Iridium's successors.
"Iridium Board" means the Board of Directors of Iridium.
"Iridium Director" means any person authorized to act as
director of Iridium pursuant to the LLC Agreement.
"LLC Agreement" means the Limited Liability Company Agreement
of Iridium LLC.
"managing underwriter or underwriters" means the person or
persons selected by Holders in an offering pursuant to Section 5.01 to manage
an underwritten offering of Class A Common Stock.
"Notice Distribution" shall have the meaning assigned thereto
in Section 2.02.
"Noticed Interests" shall have the meaning assigned thereto in
Section 2.03.
"Other Holder" shall have the meaning assigned thereto in
Section 6.01 of the LLC Agreement.
"person" means a natural person, partnership (whether general
or limited), limited liability company, trust, estate, association,
corporation, custodian, nominee or any other individual or entity in its own or
any representative capacity.
"Process Agent" shall have the meaning assigned thereto in
Section 12.07.
"Registering Holders" shall have the meaning assigned thereto
in Section 5.01(a)(i).
"Registerable Securities" means Class A Common Stock acquired
by a Class A Holder upon exchange of Class 1 Membership Interests pursuant to
this Agreement which have not previously been registered for sale pursuant to
this
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Agreement; provided, that, if U.S. nationally recognized securities counsel to
the Company delivers to the Company a written legal opinion to the effect that
any particular securities may be disposed of by the Holder thereof in the
manner proposed by such Holder without registration under the Securities Act,
such securities shall not be Registerable Securities.
"Registration Notice" shall have the meaning assigned thereto
in Article IV.
"Registration Request" shall have the meaning assigned thereto
in Article IV.
"Rule 144" shall have the meaning assigned thereto in Article
VI.
"Sale Notice" shall have the meaning assigned thereto in
Section 6.01 of the LLC Agreement.
"Securities Act" means the Securities Act of 1933, or any
successor thereto, as the same shall be amended from time to time.
"Shelf Registration" means a registration pursuant to a Shelf
Registration statement.
"Shelf Registration statement" means a "shelf" registration
statement of the Company pursuant to the provisions of Section 5.01 hereof
which covers Class A Common Stock on an appropriate form under Rule 415 under
the Securities Act, or any similar rule that may be adopted by the Commission
and all amendments and supplements to such registration statement, including
post-effective amendments, in each case including the prospectus contained
therein, all exhibits thereto and all material incorporated by reference
therein.
"Suspension Notice" shall have the meaning assigned thereto in
Section 5.01(c).
"Trading Day" means each Monday, Tuesday, Wednesday, Thursday
and Friday, other than any day on which securities are not traded on the
applicable exchange or in the applicable market.
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"underwriter" means any underwriter of an underwritten
offering of Common Stock pursuant to Section 5.01.
Section 1.02. Interpretation. The following provisions shall
govern the interpretation of this Agreement:
(a) The singular form of any word used herein, including the
terms defined in Section 1.01, include the plural, and vice versa, unless the
context otherwise requires. The use herein of a pronoun of any gender shall
include correlative words of the other gender.
(b) Unless otherwise expressly indicated, all references
herein to "Articles", "Sections" and other subdivisions hereof are to the
corresponding Articles, Sections or subdivisions of this Agreement; and the
words "herein", "hereof", "hereunder" and other words of similar import refer
to this Agreement as a whole and not to any particular Article, Section or
subdivision hereof.
(c) The headings or titles of the several Articles and
Sections hereof, and any table of contents appended to copies hereof, shall be
solely for convenience of reference and shall not affect the meaning,
construction or effect of this Agreement.
(d) Each reference herein to any agreement, instrument or
other document shall mean such agreement, instrument or document as from time
to time amended, modified or supplemented in accordance with the terms hereof
and thereof. The term "including" shall be construed to mean "including but
not limited to".
II. Exchange Rights.
Section 2.01. General Rights. Subject to the restrictions
on transfer contained in the LLC Agreement the deferral rights of Iridium and
the Company under Section 2.10 and the authorization of the Iridium Board
pursuant to Section 2.03, each Class 1 Membership Interest shall be
exchangeable, at any time on or after the Exchange Date, at the option of the
Holder thereof for one fully paid and non-assessable share of Class A Common
Stock, subject to adjustment as provided in Article III. The number of shares
of Class A Common Stock to be delivered by the Company pursuant to this Article
II in exchange for one Class 1 Membership Interest is hereinafter referred to
as the "Exchange Rate".
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Section 2.02. Notice Required for Exercise of Exchange
Right. In order to exercise the conditional right of exchange, a Holder shall
provide written notice (an "Exchange Notice") to the Company and Iridium of
its intent to (a) exercise its rights under this Article II and setting forth
the number of Class 1 Membership Interests to be exchanged by such Holder, (b)
exercise or not exercise its right pursuant to Articles IV and V hereof to have
registered pursuant thereto the Class A Common Stock received for Class 1
Membership Interests and (c) engage or not engage in any distribution of the
Class A Common Stock. A Holder's obligation to provide an Exchange Notice
shall be in addition to any other notices such Holder is required to provide,
under the LLC Agreement or otherwise, including any Sale Notice required under
Section 6.01 of the LLC Agreement. Promptly following receipt of such Exchange
Notice, Iridium shall send to the other Holders a copy of such notice (the
"Notice Distribution"). Such other Holders shall each then have the right
during the Exchange Window Period to elect their conditional right of exchange
by furnishing to the Company and Iridium an Exchange Notice prior to the
expiration of the Exchange Window Period that contains the same information
required by Section 2.02 (a)-(c) above. (Each Holder furnishing an Exchange
Notice during the Exchange Window Period is referred to herein as an
"Exchanging Holder".) The receipt of additional Exchange Notices during the
Exchange Window Period shall not require another Notice Distribution by
Iridium. No Exchange Notice may be given by any member of Iridium (and, if
given by any member of Iridium shall not be effective) during the six month
period following the expiration of the Exchange Window Period. No Holder may
furnish any notice under this Section 2.02 or otherwise participate in any
exchange hereunder unless such Holder and its affiliates are in full compliance
with the LLC Agreement and any Gateway Authorization Agreement to which it or
any of its affiliates is a party.
Section 2.03. Iridium Board Authorization Required for
Exchange. (a) At the next annual or regular meeting of the Iridium Board
following the date (the "Final Required Transfer Date") that is [THIRTY] days
after the date of expiration of the Exchange Window Period, the Iridium Board
shall determine whether to authorize the exchange of the Class 1 Interests
requested to be exchanged pursuant to the Exchange Notices received during such
Exchange Window Period which have not been transferred to
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Iridium or Other Holders pursuant to the LLC Agreement (the "Noticed
Interests"); provided that the Iridium Board may determine whether to authorize
the exchange of the Noticed Interests at any special meeting of the Iridium
Board held after the Final Required Transfer Date and prior to the next annual
or regular meeting following the Final Required Transfer Date. Authorization
of the exchange of the Noticed Interests pursuant to this Section 2.03(a) shall
require the affirmative vote of Iridium Directors representing at least 66 2/3%
of the Iridium Directors on the Iridium Board.
(b) In the event the Iridium Board does not authorize the
exchange of the Noticed Interests pursuant to Section 2.03(a), the Iridium
Board may, in its sole discretion, authorize the exchange of a number of Class
1 Interests less than the number of Noticed Interests; provided that such
authorization of the exchange of a lesser number of Class 1 Interests than the
number of Noticed Interests shall require the affirmative vote of Iridium
Directors representing at least 66 2/3% of the Iridium Directors on the Iridium
Board.
(c) If the Iridium Board grants its authorization, notice
in substantially the form of Annex C shall be given to each Exchanging Holder
and each such Exchanging Holder shall have 10 Business Days from the date of
receipt thereof to countersign and return such notice. Any Exchanging Holder
that fails to so countersign and return its notice shall lose its exchange
rights with respect to that Exchange Window Period.
Section 2.04. Exchange; Allocation of Iridium Board
Authorization. At the Closing described in Section 2.05, which shall take
place following receipt by Iridium of a duly authorized and countersigned
Notice of Exchange Authorization in substantially the form of Annex C, the
Company shall issue and deliver to such Exchanging Holder shares of Class A
Common Stock in an amount equal to the Exchange Rate multiplied by the
appropriate number of Noticed Interests; provided, however, that if by
operation of Section 2.03 the number of Noticed Interests exceeds the number
Class 1 Interests authorized for exchange by the Iridium Board, the right to
exchange Class 1 Membership Interests shall be pro rated among the Exchanging
Holders, based on the number of Class 1 Membership Interests proposed to be
exchanged in each Exchanging Holders' Exchange Notice to the Company and
Iridium.
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Section 2.05. Closing. The closing of the transactions
contemplated by this Article II shall take place at such specific time and
place as shall be mutually agreed upon by the Company, Iridium and the
Exchanging Holder involved (the "Closing"). At the Closing, the Exchanging
Holder shall relinquish to the Company certificates representing such Class 1
Membership Interests as are to be exchanged accompanied by such instruments of
transfer as shall reasonably be required by the Company and Iridium, and the
Company shall deliver to such Exchanging Holders shares of Class A Common Stock
in an amount determined pursuant to Section 2.04, registered in the name of
such Exchanging Holders. The Company shall present to Iridium such Class 1
Membership Interests for transfer and Iridium shall deliver replacement
certificates representing the number of Class 1 Membership Interests
transferred to the Company in the name of the Company or its designee and
Iridium shall make corresponding notations in its books and records. In
addition, each Exchanging Holder shall deliver to the Company and Iridium a
letter of representation substantially in the form of Annex A attached hereto
and such other certificates and documents as may reasonably be requested by the
Company or Iridium (including, without limitation, evidence of receipt of all
required approvals and consents and compliance with all applicable securities
and tax laws).
No fractional interest in a share of Class A Common Stock
shall be issued by the Company upon the exchange of Class 1 Membership
Interests. Any fractional interest in a share of Class A Common Stock
resulting from the exchange of any Class 1 Membership Interests shall be paid
by Iridium in cash (computed to the nearest cent) based on the Closing Price of
the Class A Common Stock on the last Trading Day prior to the date on which
such Class 1 Membership Interests are surrendered for exchange in the manner
set forth above.
The Exchanging Holder will pay any and all documentary stamp
or similar issue or transfer taxes payable in respect of the issue or delivery
of shares of Class A Common Stock on exchange of Class 1 Membership Interests
pursuant hereto; and the Company may withhold delivery until such charge is
paid or offset against the number of shares to be delivered.
Section 2.06. Distributions With Respect to Class 1
Membership Interests. Any payment or distribution (for purposes of this
Section 2.06, a "distribution") received by an Exchanging Holder with respect
to Class 1
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Membership Interests exchanged pursuant to this Article II by such Exchanging
Holder allocable to any period after the Closing shall be forwarded immediately
by the Exchanging Holder to the Company. Iridium is hereby instructed to and
agrees to pay or cause to be paid such portions of any distribution owed to the
Company directly to the Company on behalf of such Exchanging Holder and
thereafter shall be discharged of any obligation to such Exchanging Holder with
respect to such portion of such distribution.
Section 2.07. Restricted Securities. Any Class A Common
Stock issued by the Company to any Holder prior to the effectiveness of a
registration statement filed with the Commission pursuant to Article IV below
shall be "restricted securities" and any Holder receiving such "restricted
securities" by execution and delivery of an Exchange Notice shall be deemed to
have agreed that at the time of issuance of such securities such Holder shall
execute and deliver a certificate in the form of Annex B attached hereto. The
certificates evidencing such "restricted securities" shall bear a restrictive
legend to the effect that the shares of Class A Common Stock represented
thereby have not been registered under the Securities Act, and may not be sold
except pursuant to an effective registration statement under the Securities Act
or pursuant to an applicable exemption from the registration requirements
thereof.
Section 2.08. Sale by Holder. Each Holder, by execution and
delivery of an Exchange Notice, shall be deemed to have agreed that it will
not, directly or indirectly, transfer, sell, assign, pledge, hypothecate,
encumber or otherwise dispose of, to any person, in one or a series of
transactions, any Class A Common Stock received pursuant to this Agreement,
except pursuant to an effective registration statement or an applicable
exemption from the registration requirements of the Securities Act.
Section 2.09. Company Covenants. The Company covenants that
(a) all shares of Class A Common Stock which may be issued upon exchange of
Class 1 Membership Interests will, upon issue, be duly and validly issued,
fully paid and non-assessable (no further sums will be required to be paid by
the holders of the shares in connection with the issue of
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such shares), free of all liens and charges and not subject to any preemptive
rights and (b) it will at all times reserve and keep available, free from
preemptive rights, out of the aggregate of its authorized but unissued shares
of Class A Common Stock, for the purpose of effecting exchange of Class 1
Membership Interests, the full number of shares of Class A Common Stock
deliverable upon the exchange of all outstanding Class 1 Membership Interests
not theretofore converted.
Section 2.10. Special Deferral Rights. At any time prior to
the Closing either Iridium or the Company shall have the right to defer an
exchange hereunder for a period of up to 120 days if Iridium or the Company, as
the case may be, determines that such a deferral is in the best interests of
Iridium or the Company, as the case may be, in light of possible or pending
financing transactions. Such a deferral shall be effected by the furnishing by
Iridium or the Company to the Exchanging Holders of a written notice of an
executive officer of Iridium or the Company, as the case may be, stating that
(a) the exchange is being deferred, (b) the number of days, up to 120, of such
deferral and (c) that such deferral is being implemented pursuant to this
Section 2.10. This right may not be utilized by either Iridium or the Company
more than once in any twelve month period.
III. Exchange Date and Exchange Rate Adjustments.
Section 3.01. Exchange Date. The rights of Holders pursuant
to Article II shall not be exercisable by any Holder until the 90th day (the
"Exchange Date") after the first fiscal quarter in which Iridium has achieved
positive earnings before interest, taxes, depreciation and amortization, as
determined in accordance with U.S. generally accepted accounting principles.
Section 3.02. Exchange Rate Adjustments -- Company Actions.
The Exchange Rate shall be adjusted from time to time as follows:
(a) In case the Company shall pay or make a dividend or
other distribution on any class of capital stock
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of the Company in Class A Common Stock or any other class of Common Stock, the
Exchange Rate in effect at the opening of business on the day following the
date fixed for the determination of stockholders entitled to receive such
dividend or other distribution shall be increased by multiplying such Exchange
Rate by a fraction the numerator of which shall be the sum of the number of
shares of Class A Common Stock (Common Stock in the case of a dividend in
another class of Common Stock) outstanding at the close of business on the date
fixed for such determination and the total number of shares constituting such
dividend or other distribution and the denominator of which shall be such
number of shares of Class A Common Stock (Common Stock in the case of a
dividend in another class of Common Stock) outstanding at the close of business
on the date fixed for such determination, such increase to become effective
immediately after the opening of business on the day following the date fixed
for such determination. For the purposes of this subsection (a), the number of
shares of Class A Common Stock or Common Stock at any time outstanding shall
not include shares held in the treasury of the Company.
(b) In case the Company shall issue rights or warrants to
all holders of any class of Capital Stock of the Company entitling them to
subscribe for, purchase or acquire shares of Class A Common Stock or any other
class of Common Stock at a price per share less than the current market price
per share (determined as provided in subsection (f) below) of the Class A
Common Stock (or Common Stock in the case of rights or warrants to acquire
another class of Common Stock) on the date fixed for the determination of
stockholders entitled to receive such rights or warrants, the Exchange Rate in
effect at the opening of business on the day following the date fixed for such
determination shall be increased by multiplying such Exchange Rate by a
fraction the numerator of which shall be the number of shares of
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Class A Common Stock (or Common Stock in the case of rights or warrants to
acquire another class of Common Stock) outstanding at the close of business on
the date fixed for such determination plus the number of shares of Class A
Common Stock (or Common Stock in the case of rights or warrants to acquire
another class of Common Stock) so offered for subscription, purchase or
acquisition, and the denominator of which shall be the number of shares of
Class A Common Stock (or Common Stock in the case of rights or warrants to
acquire another class of Common Stock) outstanding at the close of business on
the date fixed for such determination plus the number of shares of Class A
Common Stock (or Common Stock in the case of rights or warrants to acquire
another class of Common Stock) which the aggregate of the offering price of the
total number of shares of Class A Common Stock (or Common Stock in the case of
rights or warrants to acquire another class of Common Stock) so offered for
subscription, purchase or acquisition would purchase at such current market
price, such increase to become effective immediately after the opening of
business on the day following the date fixed for such determination. For the
purposes of this subsection (b), the number of shares of Class A Common Stock
(or Common Stock in the case of rights or warrants to acquire another class of
Common Stock) at any time outstanding shall not include shares held in the
treasury of the Company. The Company agrees not to pay any dividend or make
any distribution on shares of Common Stock held in its treasury.
(c) In case the outstanding shares of Class A Common
Stock shall be subdivided into a greater number of shares of Class A Common
Stock, the Exchange Rate in effect at the opening of business on the day
following the day upon which such subdivision becomes effective shall be
proportionately increased, and, conversely, in case the outstanding shares of
Class A Common Stock shall each be combined into a smaller number of shares of
Class A Common Stock, the Exchange Rate in effect at the opening of business on
the day following the day upon which such combination becomes effective shall
be proportionately reduced, such increase or reduction, as the case may be, to
become effective immediately after the opening of business on the day following
the day upon which such subdivision or combination becomes effective.
(d) In case the Company shall, by dividend or otherwise,
distribute to all holders of its Class A Common Stock or any other class of
Common Stock evidences of its indebtedness or assets (including securities but
excluding (i) any rights or warrants referred to in subsection (b) above, (ii)
any dividend or distribution referred to in subsection (a) above, and (iii) any
dividend or distribution paid in cash out of current or accumulated earnings),
then in each case, the
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Exchange Rate in effect at the opening of business on the day following the
date fixed for the determination of holders of Class A Common Stock or other
class of Common Stock entitled to receive such distribution shall be adjusted
by multiplying such Exchange Rate by a fraction of which the denominator shall
be the current market price per share (determined as provided in subsection (f)
below) of the Class A Common Stock (or Common Stock in the case of a dividend
or distribution on Common Stock) on such date of determination (or, if earlier,
on the date on which the Class A Common Stock (or Common Stock in the case of a
dividend or distribution on Common Stock) goes "ex-dividend" in respect of such
distribution) less the then fair market value as determined by the Company
Board (whose determination shall be conclusive) of the portion of the assets or
evidences of indebtedness so distributed (and for which an adjustment to the
Exchange Rate has not previously been made pursuant to the terms of this
Section 3.02) applicable to one share of Class A Common Stock (or Common Stock
in the case of a dividend or distribution on Common Stock), and the numerator
shall be such current market price per share of the Class A Common Stock (or
Common Stock in the case of a dividend or distribution on Common Stock), such
adjustment to become effective immediately after the opening of business on the
day following such date of determination.
(e) The reclassification or change of Class A Common
Stock or any other class of Common Stock into securities including securities
other than Class A Common Stock (or Common Stock in the case of a
reclassification or change of Common Stock) (other than any reclassification
upon a consolidation or merger to which subsection (i) below applies) shall be
deemed to involve (i) a distribution of such securities other than Class A
Common Stock (or Common Stock in the case of a reclassification or change of
Common Stock) to all holders of Class A Common Stock (or Common Stock in the
case of a reclassification or change of Common Stock) (and the effective date
of such reclassification shall be deemed to be "the date fixed for the
determination of holders of Class A Common Stock (or Common Stock) entitled to
receive such distribution" within the meaning of subsection (d) above), and, in
the case of Class A Common Stock, (ii) a subdivision or combination, as the
case may be, of the number of shares of Class A Common
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Stock outstanding immediately prior to such reclassification into the number of
shares of Class A Common Stock outstanding immediately thereafter (and the
effective date of such reclassification shall be deemed to be "the day upon
which such subdivision becomes effective" or "the day upon which such
combination becomes effective," as the case may be, and "the day upon which
such subdivision or combination becomes effective" within the meaning of
subsection (c) above).
(f) For the purpose of any computation under subsection
(b) or (d) above, the current market price per share of Class A Common Stock or
Common Stock on any day shall be deemed to be the average of the Closing Prices
of the Class A Common Stock (or Common Stock in the case of Common Stock) for
the 20 consecutive Trading Days selected by the Company Board commencing no
more than 30 Trading Days before and ending no later than the second Trading
Day before the day in question; provided, that, in the case of subsection (d),
if the period between the date of the public announcement of the dividend or
distribution and the date for the determination of holders of Class A Common
Stock or other class of Common Stock entitled to receive such dividend or
distribution (or, if earlier, the date on which the Class A Common Stock or
other class of Common Stock goes "ex-dividend" in respect of such dividend or
distribution) shall be less than 20 Trading Days, the period shall be such
lesser number of Trading Days but, in any event, not less than five Trading
Days.
(g) No adjustment in the Exchange Rate in respect of this
Section 3.02 shall be required unless such adjustment would require an increase
or decrease of at least 1% in such rate; provided, however, that any
adjustments which by reason of this clause (g) are not required to be made
shall be carried forward and taken into account in any subsequent adjustment
and provided, further, that adjustments shall be required and made in
accordance with the provisions of this Section 3.02 (other than this clause
(g)) not later than such time as may be required in order to preserve the tax
free nature of a distribution to the holders of shares of Class A Common Stock
or other class of Common Stock. Anything in this clause (g) to the contrary
notwithstanding, the Company shall be entitled, at its option, to make such
increases in the Exchange Rate, in addition to those required by this Section
3.02, as it in its discretion shall determine to be advisable in
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order that any stock dividend, subdivision or combination of shares,
distribution of capital stock or rights or warrants to purchase stock or
securities, or distribution of evidences of indebtedness or assets (other than
cash dividends or distributions paid from current or accumulated earnings) or
other event shall be a tax free distribution to holders for United States
federal income tax purposes. All calculations under this clause (g) shall be
made to the nearest cent.
(h) Whenever the Exchange Rate is adjusted as provided in
this Section 3.02, the Company shall provide written notice of such adjustment
to Iridium, which notice shall include the Exchange Rate after such adjustment
and shall set forth a brief statement of the facts requiring such adjustment
and the manner of computing the same.
(i) In case of any consolidation of the Company with, or
merger of the Company into, any other entity, any merger of another entity into
the Company (other than a merger which does not result in any reclassification,
conversion, exchange or cancellation of outstanding shares of Class A Common
Stock) or any sale or transfer of all or substantially all of the assets of the
Company, Iridium shall have the right thereafter to exchange Class 1 Membership
only into the kind and amount of securities, cash and other property receivable
upon such consolidation, merger, sale or transfer by a holder of the number of
shares of Class A Common Stock or Common Stock into which such Class 1
Interests might have been exchanged immediately prior to such consolidation,
merger, sale or transfer, assuming such holder of Class A Common Stock or
Common Stock is not the entity with which the Company consolidated or into
which the Company merged or which merged into the Company or to which such sale
or transfer was made, as the case may be (a "constituent person"), or an
affiliate of a constituent person and failed to exercise its rights of
election, if any, as to the kind or amount of securities, cash or other
property receivable upon such consolidation, merger, sale or transfer (provided
that if the kind or amount of securities, cash and other property receivable
upon such consolidation, merger, sale or transfer is not the same for each
share of Class A Common Stock or Common Stock held immediately prior to such
consolidation, merger, sale or transfer by others than a constituent entity or
an affiliate thereof and in respect of which such rights of election shall not
have been exercised ("non-electing share"), then for the purpose of this
subsection (i)
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the kind and amount of securities, cash and other property receivable upon such
consolidation, merger, sale or transfer by each non-electing share shall be
deemed to be the kind and amount so receivable per share by a plurality of the
non-electing shares. If necessary, appropriate adjustment shall be made in the
application of the provisions set forth herein with respect to the rights and
interests thereafter of Iridium, so that the provisions set forth herein shall
thereafter be applicable, as nearly as may reasonably be practicable, to any
shares of stock or other securities or property thereafter deliverable on the
exchange of the Class 1 Interests. Any adjustment under this subsection (i)
shall be evidenced by written notice of such adjustment in the manner set forth
in subsection (h). The above provisions shall similarly apply to successive
consolidations, mergers, sales or transfers.
In case (x) the Company shall take any action that would
result in an adjustment to the Exchange Rate; or (y) of any consolidation or
merger to which the Company is a party and for which approval of any
shareholders of the Company is required, or of the sale or transfer of all or
substantially all of the assets of the Company; or (z) of the voluntary or
involuntary dissolution, liquidation or winding-up of the Company; then the
Company shall provide to Iridium, at least 15 days prior to the applicable
record or effective date hereinafter specified, a notice stating (i) the date
on which a record is to be taken for the purpose of such actions, or, if the
record is not to be taken, the date as of which the holders of Common Stock or
Class A Common Stock, as the case may be, of record are to be determined, or
(ii) the date on which such consolidation, merger, sale, transfer, dissolution,
liquidation or winding-up is expected to become effective, and the date as of
which it is expected that holders of Class A Common Stock or Common Stock of
record shall be entitled to exchange their shares of Class A Common Stock or
Common Stock for securities, cash or other property deliverable upon such
consolidation, merger, sale, transfer, dissolution, liquidation or winding-up.
Neither the failure to give such notice nor any defect therein shall affect the
legality or validity of the proceedings described in clauses (x) through (z)
above.
Section 3.03. Exchange Rate Adjustments -- Iridium Actions.
The Exchange Rate shall be adjusted from time to time as follows:
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(a) In case Iridium shall pay or make a dividend or other
distribution on any class of Iridium Interests in Class 1 Interests, the
Exchange Rate in effect at the opening of business on the day following the
date fixed for the determination of Iridium members entitled to receive such
dividend or other distribution shall be decreased by multiplying such Exchange
Rate by a fraction the denominator of which shall be the sum of the number of
Class 1 Interests outstanding at the close of business on the date fixed for
such determination and the total number of Class 1 Interests constituting such
dividend or other distribution and the numerator of which shall be such number
of Class 1 Interests outstanding at the close of business on the date fixed for
such determination, such decrease to become effective immediately after the
opening of business on the day following the date fixed for such determination.
For the purposes of this subsection (a), the number of Class 1 Interests at any
time outstanding shall not include interests held in the treasury of Iridium.
(b) In case Iridium shall issue rights or warrants to all
holders of any class of Iridium Interests entitling them to subscribe for,
purchase or acquire Class 1 Interests at a price per Class 1 Interest less than
the current market price per share (determined as provided in subsection (f)
below) of Class A Common Stock multiplied by the Exchange Rate on the date
fixed for the determination of Iridium Interest holders entitled to receive
such rights or warrants, the Exchange Rate in effect at the opening of business
on the day following the date fixed for such determination shall be decreased
by multiplying such Exchange Rate by a fraction the denominator of which shall
be the number of Class 1 Interests outstanding at the close of business on the
date fixed for such determination plus the number of Class 1 Interests so
offered for subscription, purchase or acquisition, and the numerator of which
shall be the number of Class 1 Interests outstanding at the close of business
on the date fixed for such determination plus the number of Class 1 Interests
which the aggregate of the offering price of the total number of Class 1
Interests so offered for subscription, purchase or acquisition would purchase
at a price per Class 1 Interest equal to the market
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price per Share of Class A Common Stock multiplied by the Exchange Rate in
effect at the opening of business on the day following the date fixed for the
determination of Iridium Interest holders entitled to receive such rights or
warrants, such increase to become effective immediately after the opening of
business on the day following the date fixed for such determination. For the
purposes of this subsection (b), the number of Class 1 Interests at any time
outstanding shall not include shares held in the treasury of Iridium. Iridium
agrees not to pay any dividend or make any distribution on Iridium Interests
held in its treasury.
(c) In case the outstanding Class 1 Interests shall be
subdivided into a greater number of Class 1 Interests, the Exchange Rate in
effect at the opening of business on the day following the day upon which such
subdivision becomes effective shall be proportionately decreased, and,
conversely, in case the outstanding Class 1 Interests shall each be combined
into a smaller number of Class 1 Interests, the Exchange Rate in effect at the
opening of business on the day following the day upon which such combination
becomes effective shall be proportionately increased, such reduction or
increase, as the case may be, to become effective immediately after the opening
of business on the day following the day upon which such subdivision or
combination becomes effective.
(d) In case Iridium shall, by dividend or otherwise,
distribute to all holders of its Class 1 Interests evidence of its indebtedness
or assets (including securities but excluding (i) any rights or warrants
referred to in subsection (b) above, (ii) any dividend or distribution referred
to in subsection (a) above, and (iii) any dividend or distribution paid in cash
out of current or accumulated earnings), then in each case, the Exchange Rate
in effect at the opening of business on the day following the date fixed for
the determination of holders of Class 1 Interests entitled to receive such
distribution shall be adjusted by multiplying such Exchange Rate by a fraction
of which the numerator shall be the current market price per share (determined
as provided in subsection (f) below) of the Class A Common Stock on such date
of determination
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multiplied by the Exchange Rate (or, if earlier, on the date on which the Class
1 Interests go "ex-dividend" in respect of such distribution) less the then
fair market value as determined by the Iridium Board (whose determination shall
be conclusive) of the portion of the assets or evidences of indebtedness so
distributed (and for which an adjustment to the Exchange Rate has not
previously been made pursuant to the terms of this Section 3.03) applicable to
one Class 1 Interest, and the denominator shall be such current market price
per share of the Class A Common Stock multiplied by the Exchange Rate, such
adjustment to become effective immediately after the opening of business on the
day following such date of determination.
(e) The reclassification or change of Class 1 Interests
into interests or securities including Iridium Interests other than Class 1
Interests shall be deemed to involve (i) a distribution of such interests or
securities other than Class 1 Interests to all holders of Class 1 Interests
(and the effective date of such reclassification shall be deemed to be "the
date fixed for the determination of holders of Class 1 Interests entitled to
receive such distribution" within the meaning of subsection (d) above), and
(ii) a subdivision or combination, as the case may be, of the number of shares
of Class 1 Interests outstanding immediately prior to such reclassification
into the number of Class 1 Interests outstanding immediately thereafter (and
the effective date of such reclassification shall be deemed to be "the day upon
which such subdivision becomes effective" or "the day upon which such
subdivision becomes effective," as the case may be, and "the day upon which
such subdivision or combination become effective" within the meaning of
subsection (c) above).
(f) For the purpose of any computation under subsection
(b) or (d) above, the current market price per share of Class A Common Stock on
any day shall be deemed to be the average of the Closing Prices of the Class A
Common Stock for the 20 consecutive Trading Days selected by the Company Board
commencing no more than 30 Trading Days before and ending no later than the
second Trading Day before the day in question (adjusted as necessary in the
discretion of
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the Iridium Board to reflect any dividends or other distributions on the Class
A Common Stock).
(g) No adjustment in the Exchange Rate in respect of this
Section 3.03 shall be required unless such adjustment would require an increase
or decrease of at least 1% in such rate; provided, however, that any
adjustments which by reason of this clause (g) are not required to be made
shall be carried forward and taken into account in any subsequent adjustment
and provided, further, that adjustments shall be required and made in
accordance with the provisions of this Section 3.03 (other than this clause
(g)) not later than such time as may be required in order to preserve the tax
free nature of a distribution to the holders of Iridium Interests. Anything in
this clause (g) to the contrary notwithstanding, Iridium shall be entitled, at
its option, to make such decreases in the Exchange Rate, in addition to those
required by this Section 3.03, as it in its discretion shall determine to be
advisable in order that any interest dividend, subdivision or combination of
interests, distribution of interests or rights or warrants to purchase
interests, or distribution of evidences of indebtedness or assets (other than
cash dividends or distributions paid from current or accumulated earnings) or
other event shall be a tax free distribution to holders for United States
federal income tax purposes. All calculations under this clause (g) shall be
made to the nearest cent.
(h) Whenever the Exchange Rate is adjusted as provided in
this Section 3.03, the Iridium shall provide written notice of such adjustment
to the Company, which notice shall include the Exchange Rate after such
adjustment and shall set forth a brief statement of the facts requiring such
adjustment and the manner of computing the same.
Section 3.04. Exchange Rate Adjustments -- General. Anything
in this Article III to the contrary notwithstanding, it is the intent of the
parties that the Exchange Rate be adjusted to reflect events affecting the
capital structure of Iridium and the Company, including those events described
in this Article III, as necessary or appropriate to place the parties to this
Agreement in the
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same relative position which they would have been had such events not occurred,
and the parties hereby agree that Exchange Rate in effect at any time shall
reflect such intent.
IV. Registration Rights.
At any time from and after the Exchange Date, the Company
shall, after a written request (a "Registration Request") from Holders or Class
A Holders requesting registration under the Securities Act of an aggregate
number of Registerable Securities representing not less than 2% of the Deemed
Outstanding Class A Shares, promptly notify all Holders and Class A Holders in
writing of the receipt of such request and each such Holder or Class A Holder
may elect (by written notice (a "Registration Notice") to the Company within 14
days after receipt by such Holder or Class A Holder of the aforementioned
notice from Iridium or the Company, as the case may be), to join in the
Registration Request and to have the Registerable Securities specified in its
notice included in such registration pursuant to this Article. The
Registration Notice to the Company must be in substantially the form of Annex D
hereto and must be executed by the Holder or Class A Holder. Thereupon the
Company will (a) file as soon as reasonably practicable a registration
statement providing for the sale by the Holders and Class A Holders of the
Registerable Securities specified in the Registration Requests, (b) use its
reasonable best efforts to have such registration statement declared effective
and remain continuously effective for a period of not less than six months or,
if earlier, until the date on which all Registerable Securities
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covered by such registration have been disposed by Holders and Class A Holders
either pursuant to the registration statement or otherwise. In addition, if
requested by Iridium, the Company will include in such registration statement
any other Registerable Securities specified by Iridium or, if another
registration is not in process under this Article IV, the Company will (x) file
as soon as reasonably practicable a registration statement providing for the
sale by Holders or Class A Holders of the specified Registerable Securities,
(y) use its best reasonable efforts to have such registration statement
declared effective and remain continuously effective for a period of not less
than [SIX] months or, if earlier, until the date on which all Registerable
Securities covered by such registration statement have been disposed of by
Holders or Class A Holders either pursuant to the registration statement or
otherwise. Such [SIX] month period shall be extended by (aa) the period that
any Suspension Notice is in effect under Section 5.01(c), (bb) the period of
any deferral under Section 5.03 during such period and (cc) if the registration
covers Class A Common Stock to be issued upon exchange of Class 1 Membership
Interests which cannot be exchanged because of a deferral of exchanges pursuant
to Section 2.10, by the period of any such deferral. The Company further
agrees that if permitted by the rules and regulations of the Commission, the
registration contemplated by this Article IV shall be a Shelf Registration.
V. Procedure for Registration.
Section 5.01. Registration Statement. (a) In connection with
the obligations of the Company under Article IV, the Company shall:
(i) prepare and file with the Commission, a registration
statement with respect to the Class A Common Stock on any form which
may be utilized by the Company and which shall permit the disposition
of Class A Common Stock in accordance with the intended method or
methods thereof, as specified in writing to the Company by Holders and
Class A Holders whose Registerable Securities are covered by such
registration statement ("Registering Holders") and use its reasonable
best efforts to cause such registration statement to become effective
as soon as practicable thereafter;
(ii) prepare and file with the Commission such amendments
and supplements to such registration statement and the prospectus used
in connection therewith as may be necessary to maintain the
effectiveness of such registration statement for the period required
by Article IV and to comply with the provisions of the Securities Act
with respect to the sale or other disposition of the Class A Common
Stock covered by such registration statement;
(iii) for a reasonable period prior to the filing of such
registration statement, and throughout the period required by Article
IV upon reasonable notice, make available for inspection by a
representative of
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the Registering Holders, any underwriter participating in any
distribution pursuant to the registration statement, and any attorney
or accountant designated by the Registering Holders, at a reasonable
time and in a reasonable manner, financial and other information and
books and records of the Company and Iridium, and cause the officers,
directors and employees of the Company and Iridium to respond to such
inquiries and supply information reasonably requested by any such
representative, underwriter, attorney or accountant in the course of
conducting a reasonable investigation within the meaning of Section 11
of the Securities Act; provided, however, that such representatives,
attorneys or accountants shall be acceptable to the Company and
Iridium in their respective judgments reasonably exercised and shall
agree to enter into written confidentiality agreements acceptable to
the Company and Iridium regarding any records, information or
documents that are designated by the Company or Iridium as
confidential unless such records, information or documents are
available to the public or disclosure of such records, information or
documents is required by court or administrative order after the
exhaustion of appeals therefrom and to use such information obtained
pursuant to this provision only in connection with the transaction for
which such information was obtained, and not for any other purpose;
(iv) promptly notify the Registering Holders, and the
managing underwriter or underwriters, if any, thereof and confirm such
advice in writing, (A) when such registration statement or supplement
or post-effective amendment has been declared or becomes effective,
(B) of the issuance by the Commission of any stop order suspending the
effectiveness of such registration statement or the initiation or
threatening of any proceedings for that purpose, (C) of the receipt by
the Company of any notification with respect to the suspension of the
qualification of the Class A Common Stock for sale in any jurisdiction
or the initiation or threatening of any proceeding for such purpose,
or (D) of the happening of any event during the period such
registration statement is effective which makes any statement made in
such registration statement or the related prospectus untrue in any
material respect or which requires the making of any changes in such
registration statement or prospectus in order to make the statements
therein not misleading;
(v) upon the occurrence of any event contemplated by
Section 5.01(a)(iv)(D) hereof, use its
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reasonable best efforts to prepare a supplement or post-effective
amendment to such registration statement or the related prospectus or
any document incorporated therein by reference or file any other
required document so that, as thereafter delivered to the purchasers
of the Class A Common Stock, such prospectus will not contain any
untrue statement of a material fact or omit to state a material fact
necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading;
(vi) use its reasonable best efforts to obtain the
withdrawal of any order suspending the effectiveness of such
registration statement or any post-effective amendment thereto at the
earliest practicable date;
(vii) provide copies of any prospectus, any amendment to the
registration statement or amendment or supplement to any prospectus or
any document which is to be incorporated by reference into such
registration statement or any prospectus after initial filing of such
registration statement, a reasonable time prior to the filing of any
such prospectus, amendment, supplement or document, to the Registering
Holders and underwriters, if any, and make the representatives of the
Company and Iridium available on a reasonable basis if reasonably
requested by the Registering Holders; provided that the requirements
of this paragraph shall not apply to the Company's Annual Report on
Form 10-K, its Quarterly Reports on Form 10-Q, its current reports on
Form 8-K or any other documents filed pursuant to Sections 13(a),
13(c), 14 or 15(d) of the Exchange Act (the "Exchange Act Documents");
and further provided that the Company shall promptly notify
Registering Holders of the filing of any Exchange Act Documents except
for such Exchange Act Documents specifically related to the offering
of other securities and not to the Registerable Securities;
(viii) furnish to each Registering Holder and to each
underwriter and selling agent, if any, at the expense of the
Registering Holders as many copies of the prospectus, including each
preliminary prospectus, and any amendment or supplement thereto and
such other documents as such Registering Holder or managing
underwriter may reasonably request, in order to facilitate the public
sale or other disposition of the Class A Common Stock;
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(ix) use its reasonable best efforts to (A) register or
qualify the Class A Common Stock to be included in such registration
statement under such securities laws or blue sky laws of such
jurisdictions as any Registering Holders and each placement or sales
agent, if any, therefor and each underwriter, if any, thereof shall
reasonably request in writing on a timely basis, (B) take any and all
other actions as may be reasonably necessary or advisable to enable
each such holder, agent, if any, and each underwriter, if any, to
consummate the disposition in such jurisdictions of Class A Common
Stock; provided that neither the Company nor Iridium shall be required
for any such purpose to (w) qualify as a foreign corporation or
foreign limited liability company in any jurisdiction wherein it would
not otherwise be required to qualify but for the requirements of this
paragraph 5.01(a)(ix), (x) file a general consent to service of
process in any such jurisdiction, (y) subject itself to taxation in
any jurisdiction where it is not already subject to taxation or (z)
make any changes to its Memorandum of Association or Bye-Laws or the
LLC Agreement, as the case may be, or any agreement between it and its
shareholders or members, as the case may be;
(x) use its reasonable best efforts to obtain the consent
or approval of each governmental agency or authority, whether federal,
state or local, in the U.S. or Bermuda which may be required to effect
the registration or the offering or sale in connection therewith or to
enable the Exchanging Holder(s) to offer, or to consummate the
disposition of, their Class A Common Stock;
(xi) furnish to each Registering Holder, without charge,
at least one conformed copy of such registration statement and any
post-effective amendment thereto (without documents incorporated
therein by reference or exhibits thereto, unless requested);
(xii) cooperate with the Registering Holders and the managing
underwriters, if any, to facilitate the timely preparation and
delivery of certificates representing the Class A Common Stock to be
sold, which shall not bear any restrictive legends; and, in the case
of an underwritten offering, enable such Class A Common Stock to be in
such denominations and registered in such names as the managing
underwriters may request at least two Business Days prior to any sale
of the Class A Common Stock; and
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(xiii) enter into and deliver all such customary agreements
(including underwriting or purchase agreements), documents and take
such other actions (including causing the delivery of opinions of
counsel and "comfort" letters of independent certified public
accountants) as are reasonably requested of the Company or Iridium to
expedite or facilitate the disposition of the Class A Common Stock.
(b) Iridium hereby agrees to provide the Company with all
assistance reasonably necessary for the Company to comply with its obligations
under Section 5.01(a).
(c) Each Registering Holder, by execution and delivery of
a Registration Notice, shall be deemed to have agreed that, upon receipt of any
(i) notice from the Company of the happening of any event of the kind described
in Section 5.01(a)(iv)(B), (C) or (D), (ii) notice from the Company that it is
in possession of material information that has not been disclosed to the public
and the Company reasonably deems it to be advisable not to disclose such
information in a registration statement or prospectus or (iii) notice from the
Company that it is in the process of a registered offering of securities and
the Company reasonably deems it to be advisable to have Registering Holders
temporarily discontinue disposition of Class A Common Stock pursuant to the
registration statement (in each case, such notice being hereinafter referred to
as a "Suspension Notice"), such Registering Holder will forthwith discontinue
disposition of Class A Common Stock pursuant to any registration statement and
shall not be entitled to the benefits provided under Article VIII hereof with
respect to any sales made by it in contravention of this subsection, until such
Registering Holder's receipt of the copies of the supplemented or amended
prospectus contemplated by Section 5.01(a)(v) or a notice in accordance with
Section 5.01(a)(vi) hereof that any order suspending the effectiveness of the
registration statement has been withdrawn, or, in the case of (ii) or (iii)
above, until further notice from the Company that disposition of Registerable
Securities may resume. Any Suspension Notice must be based upon a good faith
determination of the Company Board that such Suspension Notice is necessary.
In the case of a Suspension Notice, if so directed by the Company, each
Registering Holder by execution and delivery of a Registration Notice, shall be
deemed to have agreed to deliver to the Company (at the expense of Iridium) all
copies in its possession, other than permanent file copies then in such
Registering Holder's possession, of the
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prospectus covering such Class A Common Stock which is current at the time of
receipt of such notice. If the Company shall give any such notice to suspend
the disposition of Class A Common Stock pursuant to any registration statement,
the Company shall extend the period during which such registration statement
shall be maintained effective pursuant to this Agreement by the number of days
during the period from and including the date of the giving of such notice to
and including the date when the Registering Holders shall have received copies
of the supplemented or amended prospectus necessary to resume such dispositions
or received notice that any order suspending dispositions of the Class A Common
Stock has been withdrawn.
(d) By execution and delivery of a Registration Notice,
each Registering Holder shall be deemed to have agreed that the Company may
require such Registering Holder to (i) furnish in writing to the Company such
information regarding such Registering Holder and such Registering Holder's
intended method of distribution of its Class A Common Stock as the Company may
from time to time reasonably request in writing, but only to the extent that
such information is required in order to comply with the Securities Act and
(ii) enter into and deliver all such customary agreements (including
underwriting or purchase agreements) and documents (including legal opinions)
as are reasonably requested of such Registering Holder to expedite or
facilitate the disposition of its Class A Common Stock. Each such Registering
Holder, by execution and delivery of a Registration Notice, shall be deemed to
have agreed to notify the Company as promptly as practicable of any inaccuracy
or change in information previously furnished by such Registering Holder to the
Company or of the occurrence of any event in either case as a result of which
any prospectus relating to such registration contains or would contain an
untrue statement of a material fact regarding such Registering Holder or such
Registering Holder's intended method of distribution of its Class A Common
Stock or omits to state any material fact regarding such Registering Holder or
such Registering Holder's intended method of distribution of its Class A Common
Stock required to be stated therein or necessary to make the statements therein
not misleading in
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light of the circumstances then existing, and promptly to furnish to the
Company any additional information required to correct and update any
previously furnished information or required so that such prospectus shall not
contain, with respect to such Registering Holder or the distribution of its
Class A Common Stock, an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the statements
therein not misleading in light of the circumstances then existing. Each such
Registering Holder, by execution and delivery of a Registration Notice, shall
be deemed to have agreed to comply with the provisions of the Securities Act
and the Exchange Act applicable to such Registering Holder with respect to the
disposition by such Registering Holder of Class A Common Stock covered by such
registration statement in accordance with the intended methods of disposition
by such Registering Holder set forth in such registration statement.
Section 5.02. Registration of Additional Shares. The
registration statement filed pursuant to this Article V, may, in addition to
the shares of Class A Common Stock subject to registration rights set forth in
Article IV above, include other securities for sale for the Company's own
account or for the account of any other person.
Section 5.03. Deferral Period. Notwithstanding the
foregoing, if the Company shall furnish to the Registering Holders a
certificate (the "Company Certificate") signed by the Chief Executive Officer
of the Company stating that, in the good faith judgment of the Company Board,
acting reasonably and in the best interest of the Company, it would be
seriously detrimental to the Company and its shareholders for such registration
statement to be filed or for the Registering Holders to sell Class A Common
Stock acquired pursuant to this Agreement under any such effective registration
statement and it is therefore necessary to defer the filing of the registration
statement or suspend the ability of the Registering Holders to sell Class A
Common Stock acquired pursuant to this Agreement under an effective
registration statement, each Registering Holder, by execution and delivery of a
Registration Notice, hereby agrees that the filing of the registration
statement shall be deferred, or the ability of such Registered Holder to sell
Class A Common Stock acquired pursuant to this Agreement under an effective
registration statement shall be suspended, for a period of not more than an
aggregate of 120 days from the date of the Company Certificate; provided
however, that the Company may not utilize this right more than one time in any
twelve-month period and the 120-day period shall be reduced by any period of
time in the prior six months covered by a Suspension Notice as to such
Registering Holders under Section 5.01(c). Upon any delivery of a Company
Certificate pursuant to this Section 5.03, each Registering Holder, by
execution and delivery of a Registration Notice, shall be deemed to have agreed
that it shall not dispose of its Class A Common Stock covered by the
registration statement during the above-stated 120-day period other than
pursuant to the
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limitations applicable to "restricted securities" within the meaning of Rule
144 under the Securities Act and that any sale by such Registering Holder or
its designee of such Class A Common Stock during this period shall be made only
to a person who has agreed to comply with the provisions of this Section 5.03
for the balance of the 120-day period.
Section 5.04. Expenses. By execution and delivery of a
Registration Notice, each Registering Holder shall be deemed to have agreed
that (i) all registration expenses incurred in connection with any
registration, qualification or compliance pursuant to this Article V, including
without limitation, all registration and filing fees, printing expenses, fees
and disbursements of counsel for the Company and of the Company's accountants,
blue sky fees and expenses and the expenses of any special audits incident to
or required by any such registration, shall be borne by such Registering Holder
pro rata on the basis of the number of shares of Class A Common Stock of such
Registering Holder included in such registration and (ii) such Registering
Holder shall pay its own selling expenses. Selling expenses shall mean all
costs and commissions applicable to the sale of the Class A Common Stock and
all fees and disbursements of counsel and other professionals. To the extent
that the Company registers for primary offering additional securities pursuant
to Section 5.02, Iridium shall bear the Company's pro rata share of the above
referenced registration expenses and the Company's own selling expenses.
Section 5.05. Listing. The Company shall use its reasonable
best efforts to list all Class A Common Stock covered by a registration
statement filed pursuant to this Article V on each securities exchange or
automated quotation system on which any of the Class A Common Stock is then
listed unless the Company and Iridium agree not to have the Company do so.
VI. Rule 144 Information.
With a view to making available to the Holders and Class A
Holders the benefits of Rule 144 under the Securities Act ("Rule 144") and any
other rule or regulation of the Commission that may at any time permit a Class
A Holder to sell restricted securities or securities subject to Rule 145 under
the Securities Act of the Company to the public without registration, the
Company agrees to: (i) make and keep public information available, as required
by Rule 144; (ii) use its reasonable best efforts to file with the Commission
in a timely manner all reports and other documents required of the Company
under the Securities Act
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and the Exchange Act; and (iii) furnish to any Class A Holder forthwith upon
request (A) a written statement by the Company that it has complied with the
reporting requirements of Rule 144, the Securities Act and the Exchange Act,
(B) a copy of the most recent annual or quarterly report of the Company and
such other reports and documents so filed by the Company and (C) such other
information as may be reasonably requested in availing any Class A Holder of
any rule or regulation of the Commission which permits the selling of any Class
A Common Stock without registration.
VII. Equal Treatment.
Nothing contained in this Agreement shall prohibit the Company
from offering, following the Exchange Date, to purchase Class 1 Membership
Interests held by a Holder for cash or any other consideration, or to exchange
additional shares of its Class A Common Stock for Class 1 Membership Interests,
all on such terms and conditions as the Company and such Holder may agree.
VIII. Indemnification.
Section 8.01. Indemnification by Iridium. Iridium will
indemnify and hold harmless each Indemnified Person against any losses, claims,
damages or liabilities, joint or several, to which such Indemnified Person may
become subject, under the Securities Act or otherwise, that directly or
indirectly arise out of or are based upon an untrue statement or alleged untrue
statement of a material fact contained in any preliminary prospectus, the
registration statement or the prospectus, or any amendment or supplement
thereto, or arise out of or are based upon the omission or alleged omission to
state therein a material fact required to be stated therein or necessary to
make the statements therein not misleading, prepared pursuant to the
transactions contemplated by this Agreement, and will reimburse such
Indemnified Person for any legal or other expenses reasonably incurred by such
Indemnified Person in connection with investigating or defending any such
action or claim as such expenses are incurred; provided, however, that Iridium
shall not be liable in any such case to the extent that any such loss, claim,
damage or liability arises out of or is based upon (i) in the case of
indemnification of the Company or its officers and directors, an intentional
act or omission of the Company of any such officers, directors or any employee
of the Company which was contrary to any written instruction or request of
Iridium or which amounted to willful misconduct on the part of such officer,
director, employee or agent of the Company
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who is not also an employee of Iridium, and (ii) in the case of a party other
than the Company or its officers and directors, an untrue statement or alleged
untrue statement or omission or alleged omission made in any preliminary
prospectus, the registration statement or the prospectus or any such amendment
or supplement in reliance upon and in conformity with written information
furnished to the Company by such Indemnified Person expressly for use therein.
Section 8.02. Indemnification by Registering Holders. Each
Registering Holder, by execution and delivery of a Registration Notice, shall
be deemed to have agreed that it will indemnify and hold harmless each
Indemnified Person against any losses, claims, damages or liabilities to which
such Indemnified Person may become subject, under the Securities Act or
otherwise, that directly or indirectly arise out of or are based upon an untrue
statement or alleged untrue statement of a material fact contained in any
preliminary prospectus, the registration statement or the prospectus, or any
amendment or supplement thereto, or arise out of or are based upon the omission
or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, in each
case to the extent, but only to the extent, that such untrue statement or
alleged untrue statement or omission or alleged omission was made in any
preliminary prospectus, the registration statement or the prospectus or any
such amendment or supplement in reliance upon and in conformity with written
information furnished to the Company by such Registering Holder expressly for
use therein; and will reimburse each Indemnified Person for any legal or other
expenses reasonably incurred by such Indemnified Person in connection with
investigating or defending any such action or claim as such expenses are
incurred.
Section 8.03. Proceedings. Promptly after receipt by an
Indemnified Person of notice of the commencement of any action, suit or
proceeding as to which a claim in respect thereof is to be made under this
Article VIII the Indemnified Person shall notify the party against whom the
Indemnified Person intends to assert a claim for indemnification (an
"Indemnifying Person") in writing of the commencement thereof, but the omission
so to notify the Indemnifying Person shall not relieve the Indemnifying Person
from any liability which it may have to any Indemnified Person otherwise than
under this Article. In case any such action shall be brought against any
Indemnified Person and it shall notify the Indemnifying Person of the
commencement thereof, the Indemnifying Person
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shall be entitled to participate therein and, to the extent that it shall wish,
to assume the defense thereof, with counsel reasonably satisfactory to such
Indemnified Person (which shall not, except with the consent of the Indemnified
Person, be counsel to the Indemnifying Person), and, after notice from the
Indemnifying Person to such Indemnified Person of its election so to assume the
defense thereof, the Indemnifying Person shall not be liable to such
Indemnified Person under such section for any legal expenses of other counsel
or any other expenses, in each case subsequently incurred by such Indemnified
Person, in connection with the defense thereof other than reasonable costs of
investigation. The Indemnifying Person shall not, without the written consent
of the Indemnified Person, effect the settlement or compromise of, or consent
to the entry of any judgment with respect to, any pending or threatened action
or claim in respect of which indemnification or contribution may be sought
hereunder (whether or not the Indemnified Person is an actual or potential
party to such action or claim) unless such settlement, compromise or judgment
(i) includes an unconditional release of such Indemnified Person from all
liability arising out of such action or claim and (ii) does not include a
statement as to or an admission of fault, culpability or a failure to act, by
or on behalf of such Indemnified Person. No Indemnified Person shall effect
the settlement or compromise of, or consent to the entry of any judgment with
respect to, any pending or threatened action or claim in respect of which
indemnification or contribution has been or may be sought hereunder without the
prior written consent of the Indemnifying Person. By execution and delivery of
a Registration Notice, each Registering Holder shall be deemed to have agreed
to the provisions of this Section 8.03.
Section 8.04. Contribution. In order to provide for just and
equitable contribution in circumstances in which the indemnity agreement
provided for in this Article VIII is for any reason held to be unenforceable by
an Indemnified Person although applicable in accordance with its terms, the
Indemnified Person on the one hand and the Indemnifying Person on the other
hand shall contribute to the aggregate losses, liabilities, claims, damages and
expenses of the nature contemplated by such indemnity agreement incurred by the
Indemnified Person; provided, however, that no person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. As between the Indemnifying Person and
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each Indemnified Person, such parties shall contribute to the aggregate losses,
liabilities, claims, damages and expenses of the nature contemplated by such
indemnity agreement in such proportion as shall be appropriate to reflect (a)
the relative benefits received by the Indemnifying Person on the one hand and
the Indemnified Person on the other hand, from the offering of the Class A
Common Stock included in such offering, and (b) the relative fault of the
Indemnifying Person on the one hand and the Indemnified Person on the other,
with respect to the statements or omissions which resulted in such loss,
liability, claim, damage or expense, or action in respect thereof, as well as
any other relevant equitable considerations. It is agreed that it would not be
just and equitable if contribution pursuant to this Article VIII were to be
determined by pro rata allocation or by any other method of allocation which
does not take into account the relevant equitable considerations. For purposes
of this Article VIII, each person, if any, who controls a party covered by the
indemnity provisions of this Article VIII within the meaning of Section 15 of
the Securities Act shall have the same rights to contribution as such party.
By execution and delivery of a Registration Notice, each Registering Holder
shall be deemed to have agreed to the foregoing contribution provisions.
IX. Representations and Warranties.
Section 9.01. Representations and Warranties of the Company.
Each of the Company and Iridium represents and warrants to each of the Holders
as follows:
(a) The execution, delivery and performance of this
Agreement by the Company or Iridium, as the case may be, have been duly
authorized by all requisite corporate or limited liability company action and
will not violate any provisions of law, any order of any court or other agency
of government, its organizational documents or any provision of any indenture,
agreement or other instrument to which it or any of its properties or assets is
bound, conflict with, result in a breach of or constitute (with due notice or
lapse of time or both) a default under any such indenture, agreement or other
instrument or result in the creation or imposition of any lien, charge or
encumbrance of any nature whatsoever upon any of the properties or assets of
the Company or Iridium, as the case may be.
(b) This Agreement has been duly executed and delivered
by the Company or Iridium, as the case may be, and constitutes the legal, valid
and binding obligation of the
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Company or Iridium, as the case may be, enforceable in accordance with its
terms.
Section 9.02. Representations, Warranties and Agreements of
the Holders and the Registering Holders. Each of the Holders by execution and
delivery of an Exchange Notice, and each Registering Holder by execution and
delivery of a Registration Notice, shall be deemed to represent, warrant to and
agree with each of the Company and Iridium as follows:
(a) The performance of this Agreement by such Holder or
Registering Holder have been duly authorized by all requisite corporate,
partnership or similar action and will not violate any provisions of law
(assuming compliance by the Company and Iridium with all applicable federal or
state securities laws), any order of any court or other agency of government,
the organizational documents of the Holder or Registering Holder or any
provision of any indenture, agreement or other instrument to which it or any of
its properties or assets is bound, conflict with, result in a breach of or
constitute (with due notice or lapse of time or both) a default under any such
indenture, agreement or other instrument or result in the creation or
imposition of any lien, charge or encumbrance of any nature whatsoever upon any
of the properties or assets of such Holder or Registering Holder.
(b) This Agreement constitutes the legal, valid and
binding obligation of the Holder or Registering Holder, enforceable in
accordance with its terms.
X. Effectiveness of Agreement.
This Agreement shall become effective only upon the first date
on which the Company purchases Class 1 Membership Interests from Iridium.
XI. Assignability.
Each of the Holders by execution and delivery of an Exchange
Notice, and each Registering Holder by execution and delivery of a Registration
Notice, shall be deemed to have agreed that, without the prior written consent
of Iridium, the interest exchange and registration rights of a Holder or Class
A Holder set forth in this Agreement shall not be assignable, in whole or in
part, to any transferee of such Holder's Class 1 Membership Interests, or such
Class A Holder's restricted securities.
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XII. Miscellaneous.
Section 12.01. Successors and Assigns. This Agreement shall
inure to the benefit of and be binding upon the successors and permitted
assigns of each of the parties; provided that this Agreement may not be
assigned by any party hereto other than in compliance with the terms hereof.
Section 12.02. Notices. All notices and other communications
provided for in this Agreement shall be in writing, shall be in the English
language and shall be sufficiently given if made (i) by hand delivery or by
telecopier and (ii) by reputable express courier service (charges prepaid) or
by registered or certified mail (postage prepaid and return receipt requested)
(a) if to the Company, at the following address:
Iridium World Communications Ltd.
Clarendon Xxxxx
0 Xxxxxx Xxxxxx
Xxxxxxxx XX 00
Xxxxxxx
Xxxxxxxxx: The Secretary
Phone: (000) 000-0000
Facsimile: (000) 000-0000
or if to Iridium, at the following address:
Iridium, LLC
0000 Xxx Xxxxxx, X.X.
Xxxxxxxxxx, X.X. 00000
X.X.X.
Attention: General Counsel
Phone: (000) 000-0000
Facsimile: (000) 000-0000
or at such other address as the Company or Iridium shall have furnished in
writing one to the other (notice of any change from the Company to Iridium
being binding upon any Holder), (b) if to any Holder, at the address maintained
by Iridium on its books and records for such purpose (which Iridium agrees to
make available to the Company at its request) and (c) if to a Class A Holder,
at the address maintained by the Company on its books and records for such
purpose. All such notices and other communications shall be deemed to have
been duly given and delivered: when delivered by hand, if personally delivered;
when receipt acknowledged,
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if delivered by telecopier; five Business Days after being deposited with a
reputable express courier service (charges prepaid); and seven Business Days
after being deposited in the mail, postage prepaid, if delivered by United
States or Bermuda mail (registered or certified mail, return receipt
requested). Each of the Holders by execution and delivery of an Exchange
Notice, and each Registering Holder by execution and delivery of a Registration
Notice, shall be deemed to have agreed to the foregoing notice provisions.
Section 12.03. Counterparts. This Agreement may be executed
in one or more counterparts, each of which shall be deemed an original and all
of which together shall be considered one and the same agreement.
Section 12.04. Entire Agreement. This Agreement constitutes
the entire understanding of the parties hereto with respect to the subject
matter hereof and supersedes all prior understanding among such parties.
Section 12.05. Governing Law; Severability. THIS AGREEMENT
SHALL BE GOVERNED BY AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE DOMESTIC
LAWS OF THE STATE OF DELAWARE WITHOUT GIVING EFFECT TO ANY CHOICE OF LAW OR
CONFLICT OF LAW PROVISION OR RULE (WHETHER OF THE STATE OF DELAWARE OR ANY
OTHER JURISDICTION) THAT WOULD CAUSE THE APPLICATION OF THE LAWS OF ANY
JURISDICTION OTHER THAN THE STATE OF DELAWARE. If it shall be determined by a
court of competent jurisdiction that any provision or wording of this Agreement
shall be invalid or unenforceable under applicable law, such invalidity or
unenforceability shall not invalidate this entire Agreement. In that case,
this Agreement shall be construed so as to limit any term or provision so as to
make it enforceable or valid within the requirements of any applicable law,
and, in the event such term or provision cannot be so limited, this Agreement
shall be construed to omit such invalid or unenforceable provisions.
Section 12.06. Amendments to the Agreement. This Agreement
may not be changed or amended or the observance of any provisions waived
without the written consent of each of the Company and Iridium. No consent to
any such amendment by the Holders or the Class A Holders shall be required.
Section 12.07. Jurisdiction and Service of Process. Any
suit, action or proceeding against any party with respect to this Agreement and
any Holder or Registering Holder may be brought in a court of the United States
sitting in the State of Delaware or, if jurisdiction is
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lacking in such a court, in a court of record in the State of Delaware, and
each party hereto, each Holder by execution and delivery of an Exchange Notice,
and each Registering Holder by execution and delivery of a Registration Notice,
(i) irrevocably waives, to the fullest extent permitted by law, any objection
that it may have, whether now or in the future, to the laying of venue in, or
to the jurisdiction of, any and each of such courts for the purpose of any such
suit, action, proceeding or judgment and further waives any claim that any such
suit, action, proceeding or judgment has been brought in an inconvenient forum,
and submits to such jurisdiction, (ii) agrees that service of all writs,
process and summonses in any such suit, action or proceeding brought in the
State of Delaware may be made upon The Corporation Trust Company, 0000 Xxxxxx
Xxxxxx, Xxxxxxxxxx, Xxxxxxxx 00000, or such alternate process agent in the
United States designated with respect to the party, Holder or Registering
Holder in a writing delivered to Iridium and the Company (the "Process Agent"),
(iii) irrevocably appoints the Process Agent in its name, place and stead to
receive and forward such service of any and all such writs, process and
summonses, (iv) agrees that the failure of the Process Agent to give any notice
of any such service of process to such party, Holder or Registering Holder
shall not impair or affect the validity of such service or of any judgment
based thereon, (v) agrees to appoint a substitute process agent, if the Process
Agent is no longer able to so act for any reason whatsoever, which substitute
process agent shall thereafter be deemed to be the Process Agent hereunder and
to give notice of such appointment to Iridium and the Company and (vi) if the
party is a government, irrevocably waives any and all claims of immunity in
connection with the execution, performance and enforcement of this Agreement
and others in any way related to this Agreement, including, without limitation,
with respect to service of process, submission to jurisdiction, attachment and
execution on property.
IN WITNESS WHEREOF, the parties hereto have executed this
Agreement as of the date first above written.
IRIDIUM WORLD COMMUNICATIONS LTD
By:
-----------------------------
Name:
Title:
IRIDIUM LLC
By:
-----------------------------
Name:
Title:
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ANNEX A
LETTER OF REPRESENTATIONS
Iridium World Communications Ltd.
Iridium LLC
0000 Xxx Xxxxxx
Xxxxxxxxxx, XX 00000
Ladies and Gentleman:
The undersigned, an "Exchanging Holder" under the Interest
Exchange Agreement (the "Exchange Agreement"), dated as of June __, 1997, by
and between Iridium LLC ("Iridium") and Iridium World Communications Ltd.
("IWCL"), hereby acknowledges, represents, warrants, and agrees, on behalf of
itself and its assigns, that in connection with the undersigned's exchange of
Class 1 Membership Interests in Iridium for shares of Class A Common Stock of
IWCL (its "Exchange") pursuant to the Exchange Agreement:
(i) Pursuant to the terms of the Exchange Agreement, the
undersigned has duly and validly executed a Notice of Exchange
Authorization agreeing to be bound by certain provisions of the
Exchange Agreement. Each of the Exchange and the undersigned's
execution, delivery and performance under the Notice of Exchange
Authorization complies with all laws applicable to the undersigned or
to which it is subject and does not violate, breach or conflict with
any agreement to which it is a party or by which it is bound. The
Notice of Exchange Authorization is and will be valid, binding and
enforceable against the undersigned in accordance with its terms.
(ii) The undersigned has obtained all consents or
approvals required by governmental entities that are necessary in
connection with the Exchange and its execution, delivery and
performance under the Notice of Exchange Authorization.
(iii) Each of the Exchange and the undersigned's execution,
delivery and performance under the Notice of Exchange Authorization
does not violate any laws which pertain to the offer or sale of
securities generally in any jurisdiction to which the undersigned may
be subject or in any jurisdiction which may claim a right
44
to regulate such offer to, or purchase by, the undersigned (it being
expressly understood that the undersigned is not giving a
representation or warranty as to whether IWCL or Iridium has complied
with the federal or state laws of the United States which pertain to
the offer or sale of securities).
(iv) Neither IWCL nor Iridium has rendered any investment
advice to the undersigned in connection with the Exchange. The
undersigned has had access to such financial and other information
concerning IWCL and Iridium as it has deemed necessary in connection
with its decision to effect the Exchange. In electing to effect the
Exchange the undersigned has relied only on the advice of its own
advisors.
(v) The certificates representing the shares of Class A
Common Stock of IWCL to be received by the undersigned in connection
with the Exchange will bear such legend or legends, consistent with
the terms of the Exchange Agreement, as IWCL, Iridium or their
respective legal counsel deems necessary or desirable.
THIS LETTER SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH,
THE LAWS OF THE STATE OF DELAWARE WITHOUT GIVING EFFECT TO APPLICABLE
PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT APPLICATION OF THE LAWS OF A
JURISDICTION OTHER THAN THE STATE OF DELAWARE WOULD BE REQUIRED THEREBY
Date:
Very truly yours,
----------------------------
[Exchanging Holder]
By:
Title:
45
ANNEX B
RESTRICTED SECURITIES CERTIFICATE
The undersigned, an "Exchanging Holder" under the Interest
Exchange Agreement (the "Exchange Agreement"), dated as of June __, 1997,
between Iridium LLC ("Iridium") and Iridium World Communications Ltd. ("IWCL"),
hereby acknowledges, represents, warrants, and agrees, on behalf of itself and
its assigns, that:
(i) Any shares of Class A Common Stock of IWCL issued to
the undersigned upon exchange of Class 1 Membership Interests in
Iridium pursuant to the Exchange Agreement prior to the effectiveness
of a registration statement filed with the U.S. Securities and
Exchange Commission pursuant to Article IV of the Exchange Agreement
in respect of such shares (a) have not been registered under the
Securities Act of 1933, as amended (the "Securities Act"), (b) have
been issued in reliance on exemptions from such registration provided
in Section 4(2) of the Securities Act and Regulation S under the
Securities Act and applicable exemptions under the state securities
laws, and (c) shall be "Restricted Securities".
(ii) It shall not sell, transfer, assign, pledge or
otherwise encumber or dispose of, directly or indirectly
(collectively, "Transfer") any Restricted Securities prior to the date
which is two years after the later of (a) the date of original issue
to the undersigned or (b) the last date on which the undersigned was
an affiliate of Iridium or IWCL, unless (1) for so long as the
Restricted Securities are eligible for resale pursuant to Rule 144A
under the Securities Act, the Transfer is made to a person the
undersigned reasonably believes is a "qualified institutional buyer"
(a such term is defined in Rule 144A, a "QIB") that is purchasing for
its own account or the account of a QIB to whom notice is given that
the Transfer is being made in reliance on Rule 144A,(2) the Transfer
is made outside the United States to a
46
person who is not a "U.S. Person" in a transaction meeting the
requirements of Rule 904 under the Securities Act, (3) the Transfer
does not violate any United States federal or state securities laws or
any of the rules and regulations promulgated thereunder (collectively,
the "U.S. Securities Laws") or the securities laws of any other
jurisdiction and, prior to effecting such Transfer, the undersigned
provides an opinion of counsel satisfactory to each of IWCL and
Iridium that such Transfer is in accordance with the U.S. Securities
Laws or (4) the Transfer is effected in accordance with the terms of
the Exchange Agreement.
(iii) It is not acquiring the Restricted Securities with a
view to, or for the offer or sale in connection with, any distribution
in violation of the Securities Act.
(iv) It shall provide to any person purchasing any
Restricted Securities from it a notice advising such purchaser that
Transfers of the Restricted Securities are restricted as set forth
herein and in the Exchange Agreement.
(v) IWCL, Iridium and others will rely upon the
undersigned's confirmations, acknowledgments and agreements set for
herein and in the undersigned's Notice of Exchange Authorization, and
the undersigned will notify IWCL and Iridium promptly in writing if
any of its representations or warranties herein or therein ceases to
be accurate and complete.
THIS CERTIFICATE SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF DELAWARE WITHOUT GIVING EFFECT TO
APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT APPLICATION OF THE
LAWS OF A JURISDICTION OTHER THAN THE STATE OF DELAWARE WOULD BE REQUIRED
THEREBY
Date:
----------------------------
[Exchanging Holder]
By:
Title:
47
ANNEX C
NOTICE OF EXCHANGE AUTHORIZATION
The Board of Directors of Iridium LLC ("Iridium") has
authorized an exchange of Class 1 Interests into shares of Class A Common Stock
of Iridium World Communications Ltd. ("IWCL") pursuant to the Interest Exchange
Agreement, dated as of June __, 1997, between Iridium and IWCL (the "Interest
Exchange Agreement"). A copy of the Interest Exchange Agreement is attached to
this Notice. By executing a copy of this Notice, the undersigned agrees, on
behalf of itself and its assigns, to be bound by (i) the provisions of the
Interest Exchange Agreement applicable to "Holders" and "Class A Holders" and,
(ii) if the undersigned or its successors or assigns elect to participate in
any registration of Class A Common Stock under the Interest Exchange Agreement,
the provisions of the Interest Exchange Agreement applicable to a "Registering
Holder".
IRIDIUM LLC
By:
------------------------- -----------------------
Date Secretary
Agreed to and accepted:
-------------------------
[Exchanging Holder]
By:
Title:
48
ANNEX D
REGISTRATION NOTICE
The undersigned holder of Class 1 Membership Interests of
Iridium LLC or shares of Class A Common Stock of Iridium World Communications
Ltd. ("IWCL") hereby notifies IWCL pursuant to the Interest Exchange Agreement,
dated as of June __, 1997, between Iridium LLC ("Iridium") and IWCL (the
"Interest Exchange Agreement") that it wishes to have registered with the
Securities and Exchange Commission the specified number of shares of Class A
Common Stock which are either currently owned by the undersigned or issuable
upon exchange of Class 1 Membership Interests currently owned by the
undersigned and as to which the undersigned has delivered an Exchange Notice to
Iridium. A copy of the Interest Exchange Agreement is attached to this Notice.
By executing a copy of this Registration Notice, the undersigned agrees, on
behalf of itself and its assigns, to be bound by the provisions of the Interest
Exchange Agreement applicable to "Registering Holders" or to "Holders" or
"Class A Holders" that have requested registration of "Registerable Securities"
under the Interest Exchange Agreement.
---------------------
[Exchanging/Registered Holder]
By:
Title:
Number of Securities to be Registered:
_________________ shares of Class A Common Stock, of which
_____________ are issuable upon exchange of Class 1 Membership
Interests.
