Exhibit 10.1
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MEMBERSHIP INTEREST PURCHASE AGREEMENT
BY AND AMONG
DTV NETWORK SYSTEMS, INC.,
THE DIRECTV GROUP, INC.,
SKYTERRA HOLDINGS, INC.,
SKYTERRA COMMUNICATIONS, INC.
AND
XXXXXX NETWORK SYSTEMS, LLC
DATED AS OF
November 10, 2005
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MEMBERSHIP INTEREST PURCHASE AGREEMENT
THIS MEMBERSHIP INTEREST PURCHASE AGREEMENT (this "Purchase
Agreement") is entered into as of November 10, 2005 by and among DTV Network
Systems, Inc. (f/k/a Xxxxxx Network Systems, Inc.), a Delaware corporation
("Seller"); The DIRECTV Group, Inc., a Delaware corporation ("DTVG," and
together with Seller, the "DTV Group"); SkyTerra Holdings, Inc., a Delaware
corporation ("Purchaser"); SkyTerra Communications, Inc., a Delaware
corporation ("SkyTerra," and together with Purchaser, the "Purchaser Group");
and Xxxxxx Network Systems, LLC, a Delaware limited liability company (the
"Company"; and together with the DTV Group and the Purchaser Group, the
"Parties").
WHEREAS, each of Seller and SkyTerra is the record and beneficial
owner of 50% of the issued and outstanding Class A Units of the Company; and
WHEREAS, Seller desires to sell to Purchaser, and Purchaser desires to
purchase from Seller, all of Seller's membership interests in the Company (the
"Seller Membership Interests"), on the terms and subject to the conditions
contained in this Purchase Agreement.
NOW, THEREFORE, in consideration of the foregoing and of the mutual
covenants and agreements set forth herein, the Parties, intending to be legally
bound, hereby agree as follows:
1. DEFINITIONS.
For all purposes of this Purchase Agreement, certain capitalized terms
not otherwise defined herein shall have the meanings set forth on Annex I.
2. PURCHASE AND SALE OF SELLER MEMBERSHIP INTERESTS.
In consideration of the mutual covenants and agreements in, and
subject to the terms and conditions of, this Purchase Agreement, upon payment
of One Hundred Million Dollars ($100,000,000) (the "Purchase Price") from or on
behalf of the Purchaser Group to Seller by wire transfer of immediately
available funds and the satisfaction or waiver of the conditions set forth in
Section 7, at the Closing, Seller shall irrevocably sell, transfer, assign,
grant and convey to Purchaser and Purchaser shall purchase from the Seller all
of Seller's right, title and interest in and to the Seller Membership
Interests, free and clear of all Encumbrances, including the right to collect
and receive all Proceeds in respect thereof and to exercise and enforce all
rights with respect to the Seller Membership Interests as set forth herein,
except for those Encumbrances set forth in the Investor Rights Agreement, the
LLC Agreement, the First Lien Pledge Agreement and the Second Lien Pledge
Agreement, and except for restrictions imposed by applicable Securities Laws.
3. CLOSING.
The closing of the Contemplated Transactions (the "Closing" and the
date thereof being sometimes hereinafter referred to as the "Closing Date")
shall take place on a mutually agreeable date occurring no more than fifteen
(15) days following the satisfaction or waiver of each of the conditions
precedent set forth in Section 7 (other than conditions which, by their nature,
are to be satisfied on the Closing Date), but in no event (i) prior to January
1, 2006 or (ii) more than one hundred and twenty (120) days from the date
hereof. Closing shall be held at the offices of O'Melveny & Xxxxx LLP, Times
Square Tower, 0 Xxxxx Xxxxxx, Xxx Xxxx, XX 00000, or at such other location as
the Parties may mutually agree.
4. UNDERTAKINGS AND COVENANTS. The Parties hereby covenant and agree as
follows:
4.1 Consents and Approvals.
(a) The Parties shall, as promptly as practicable (and in no
event later than ten (10) business days from the date hereof), make the filings
required under any Antitrust Laws. In addition, the Parties shall promptly make
any filings required under International Traffic in Arms Regulations, 22 C.F.R.
Parts 120-130 ("ITAR") to notify the Department of State regarding the
Contemplated Transactions. Each Party shall pay any filing fees associated with
such filings made by such Party. The Parties shall comply, and will cause their
respective Affiliates to comply, at the earliest practicable date with any
request for additional information, documents, or other materials received from
any Governmental Authority.
(b) The Parties shall as promptly as practicable make the
filings ("Communication Applications") required under any Communications Laws.
The Parties and their respective Affiliates shall cooperate with one another in
filing the Communications Applications. The cost of any fees payable to a
Governmental Authority associated with such filings shall be borne by the
Person incurring such expenses. The Parties and their respective Affiliates
also shall comply at the earliest practicable date with any request for
additional information, documents, or other materials received from any other
Governmental Authority responsible for communications matters.
(c) The Parties shall (i) furnish, or cause their respective
Affiliates to furnish, to the other Parties such information and assistance as
such Parties reasonably may request as may be reasonably necessary in
connection with the preparation of any submissions to, or agency proceedings
by, any Governmental Authority under any applicable Antitrust Law, (ii) keep
the other Parties promptly apprised of any material communications with, and
inquiries or requests for information from, such Governmental Authorities in
connection therewith, and (iii) permit the other Parties to review any material
communication given by it to, and consult with the other Parties in advance of
any meeting or conference with any such Governmental Authority or, in
connection with any Proceeding by a private party, with any other Person.
(d) The Parties shall (i) use their commercially reasonable
efforts to provide all requisite filings and notifications to Governmental
Authorities required to be filed in connection with the Contemplated
Transaction (including, but not limited to, filings and notifications related
to Communications Laws), (ii) furnish, or cause their respective Affiliates to
furnish, to the other Parties such information and assistance as such Parties
reasonably may request as may be reasonably necessary in connection with the
preparation or prosecution of any such filings and notifications, (iii) keep
the other Parties promptly apprised of any communications with, and inquiries
or requests for information from, such Governmental Authorities with respect to
the Contemplated Transactions, (iv) keep the other Parties apprised of the
status of all applications filed with all Governmental Authorities responsible
for communications matters, and (v) permit the other Parties to review any
material communication given by it to any such Governmental Authority.
(e) Purchaser and Seller shall use their commercially
reasonable efforts to secure all such other Consents of any Governmental
Authority required in order to consummate the Contemplated Transactions.
(f) In furtherance and not in limitation of the covenants of
the Parties contained in Section 4.1(a) and 4.1(c), the Parties shall use their
commercially reasonable efforts to resolve objections, if any, which may be
asserted by any Governmental Authority with respect to the Contemplated
Transactions under any Antitrust Laws.
4.2 Public Announcements. From the date hereof, DTVG and Purchaser
shall cooperate in good faith to jointly prepare all press releases and public
announcements pertaining to this Purchase Agreement and the Contemplated
Transactions, and none of Seller, Purchaser or their respective Affiliates
shall issue or otherwise make any public announcement or communication
pertaining to this Purchase Agreement or the Contemplated Transactions without
the prior consent of Purchaser (in the case of Seller and its Affiliates) or
DTVG (in the case of Purchaser and its Affiliates), except as required by Law
or by any U.S. Governmental Authority (including the FCC) or by the rules and
regulations of, or pursuant to any agreement with, any stock exchange. Neither
DTVG nor Purchaser shall unreasonably withhold approval from the other with
respect to any such press release or public announcement. If DTVG, Purchaser or
any of their respective Affiliates determine, with the advice of counsel, that
it is required by Law to make this Purchase Agreement, the other Transaction
Documents or any terms hereof or thereof public or otherwise issue a press
release or make a similar public disclosure with respect thereto, it shall, at
a reasonable time before making any public disclosure, consult with the other
Parties regarding such disclosure, seek confidential treatment for such terms
or portions of this Purchase Agreement or the other Transaction Documents as
may be requested by Seller or Purchaser (other than in connection with the
filings with the FCC) and disclose only such information as is legally
compelled to be disclosed.
4.3 Confidentiality. Except to the extent required by Law, the DTV
Group shall not directly or indirectly disclose or make available to any third
party the Capital Commitment (as defined hereinafter); provided that the
Capital Commitment may be disclosed to Representatives of the DTV Group who
need to know such information for the purpose of consummating the Contemplated
Transactions (it being understood that such Representatives shall have been
advised of this Section 4.3 and the DTV Group shall cause such Representatives
to hold and use the Capital Commitment in accordance with this Purchase
Agreement).
4.4 Closing Conditions. From the date of this Purchase Agreement until
the earlier of Closing or termination of this Purchase Agreement pursuant to
Section 11, each of the Parties shall use their respective commercially
reasonable efforts to cause to be fulfilled and satisfied all of the Seller and
Purchaser (and the mutual) conditions to Closing set forth in Section 7.
4.5 Negotiation with Others; Disposition of Securities. From the date
of this Purchase Agreement until Closing or earlier termination of this
Purchase Agreement pursuant to the terms hereof, Seller and its Representatives
shall, and Seller shall cause its Affiliates to, deal exclusively with the
members of the Purchaser Group and their Affiliates and Representatives
regarding the acquisition of the Seller Membership Interests and, without the
prior written consent of Purchaser, neither Seller nor its respective
Representatives shall, and Seller shall cause its Affiliates not to, directly
or indirectly: (i) solicit, initiate discussions with or engage in negotiations
with any Person (whether such negotiations are initiated by Seller or
otherwise), other than a member of the Purchaser Group or its respective
Affiliates or a party designated by Purchaser, with respect to the acquisition
of the Seller Membership Interests; (ii) provide information or documentation
with respect to Seller or its respective Affiliates to any Person, other than a
member of the Purchaser Group and its respective Representatives and Affiliates
or a party designated by Purchaser, with respect to the acquisition of the
Seller Membership Interests; or (iii) enter into an agreement with any Person,
other than a member of the Purchaser Group or its Affiliates, providing for the
acquisition of the Seller Membership Interests. If the DTV Group or its
respective Affiliates or their respective Representatives receives an inquiry,
offer or proposal relating to any of the above (unsolicited or otherwise), the
DTV Group shall immediately notify Purchaser in writing of the identities of
the Persons making such inquiry, offer or proposal and the terms of such
inquiry, offer or proposal to the extent that the same does not violate any
contractual obligation or other obligation of confidentiality existing on the
date hereof.
4.6 Further Assurances. Subject to the terms and conditions herein
provided, the Parties shall do or cause to be done all such reasonable acts and
things as may be necessary, proper, or advisable, consistent with all
applicable Laws, to consummate and make effective the Contemplated Transactions
as soon as reasonably practicable. Without limiting the foregoing, each Party
shall use its reasonable best efforts, and the other Parties shall cooperate
with such efforts, (i) to execute and deliver, or cause to be executed and
delivered, such further documents and instruments, in each case as may be
necessary or proper in the reasonable judgment of Purchaser to carry out the
provisions and purposes of this Purchase Agreement and (ii) to obtain any
Consents, Orders, Government Approvals, or authorizations, or effect the
notification of or filing with, each Person, whether private or governmental,
whose consent or approval is required in order to permit the consummation of
the Contemplated Transactions.
4.7 Access to Information; Cooperation.
(a) The Company shall afford DTVG and its Affiliates and
their Representatives reasonable access upon reasonable prior notice during
normal business hours and in a manner so as not to interfere with the normal
operations of the Company to all employees, offices, properties, agreements,
records, books and affairs of the Company and its Subsidiaries reasonably
related to any Excluded Asset or Excluded Liability (as such terms are defined
in the Contribution Agreement), and provide copies of such information as DTVG
or its Affiliates may reasonably request related to the foregoing; provided,
however, that the Company shall not be required to provide any information to
DTVG or its Affiliates which could constitute a waiver of any attorney-client
privilege or violate any contractual obligation of the Company or any of its
Subsidiaries. Any such access shall be conditioned upon (i) the execution by
DTVG and any applicable Affiliates or Representatives of a confidentiality
agreement reasonably acceptable to the Company and (ii) the prompt
reimbursement by DTVG of reasonable, out-of-pocket fees, costs and expenses
(including legal fees) incurred by the Company to comply with such requests.
(b) Without limiting the obligations of the Company contained
in the Contribution Agreement or any other agreement between or among the
Parties, if the chief executive officer, chief financial officer or general
counsel of Purchaser or the Company have in their possession any information
that relates to any fact or circumstance that would reasonably be expected to
result in an Excluded Asset or Excluded Liability (as such terms are defined in
the Contribution Agreement), then promptly after such officer becomes aware
that such information is subject to the terms of this Section 4.7(b) the
Company will forward such information to DTVG. Promptly after the date hereof,
each of Purchaser and the Company shall advise its chief executive officer,
chief financial officer and general counsel of the terms of this Section
4.7(b).
4.8 Satellite Broadband Service.
(a) For five (5) years from and after the Closing, the DTV
Group shall have the right and option to purchase from the Company, either on a
wholesale or resale basis, any satellite-based broadband Internet service
commercially offered by the Company to consumers, including but not limited to
(i) its current Ku-band service, now referred to as DIRECWAY, and any future
iterations of that system ("Ku-band Service") and (ii) any other
satellite-based broadband Internet service which the Company may commercially
offer, including the service now referred to as SPACEWAY which the Company
intends to launch in 2007 ("Future Service").
If the DTV Group intends to resell either the Ku-band Service
or any Future Service pursuant to the terms hereof, the Company and the DTV
Group shall negotiate in good faith in order to execute definitive agreements
pursuant to which the Company will provide such Ku-band Service or Future
Service. The Company will provide such Ku-Band Service and/or Future Service
and all its components on economic terms at least as good as or better than the
economic terms offered by the Company to any other single reseller, wholesaler
or distributor (the agreement embodying such terms, the "Reference Agreement"),
and on non-economic terms, taken as a whole, at least as good as or better than
the non-economic terms embodied in the Reference Agreement. The Ku-Band Service
and/or Future Service shall be provided to the DTV Group at a level of quality
that is as good as or better than the level of quality the Company provides to
its subscribers or any other significant resellers, wholesalers or
distributors. The Company will not give any of its other significant resellers,
wholesalers or distributors an advantage over the DTV Group by offering a
higher level of quality or additional functionality or applications to its
consumer subscribers or the subscribers of any of its other significant
resellers, wholesalers or distributors, except that the Company may manufacture
or supply equipment for its own subscribers to the Ku-band Service and/or
Future Service that contain features or enhancements which may be different
from the equipment supplied to the DTV Group as long as the Company makes these
options and enhancements available to the DTV Group at prices consistent with
this section. Notwithstanding the foregoing, the Company shall be permitted to
offer services to its own subscribers that contain features or enhancements
which may be different from the service provided to the DTV Group, as long as
the Company makes these services available to the DTV Group at a reasonable
price consistent with the Company's overall pricing and return, as agreed by
the parties.
In determining comparability of arrangements, all direct and
indirect economic outlays in connection with or related to provision of the
Ku-band Service and/or Future Service, taken as a whole, shall be considered,
whether embodied in an agreement relating to the such services or otherwise
(e.g., side letters or other commitments), including, without limitation,
discounts, credits, commissions, rebates, revenue sharing, or other adjustments
of any kind, or other goods or services offered by or to such other significant
resellers, wholesalers or distributors.
(b) For seven (7) months from and after the date hereof, no
member of the DTV Group shall enter into any wholesale, resale, marketing,
bundling or other agreement to offer a nationwide, two-way, interactive,
broadband Internet service using Fixed-Satellite Service (as defined by the
Federal Communications Commission) satellites with any party other than the
Company.
4.9 DTV Letters of Credit Collateral. If at the Closing, for the
purpose of satisfying the condition set forth in Section 7.3(b), the Purchaser
Group or the Company delivers cash to the DTV Group in amount equal to any
collateral of the DTV Group that has not yet been returned to the DTV Group
pursuant to Section 7.3(b), all such amounts delivered by the Purchaser Group
or the Company shall be promptly returned to the Purchaser Group or the
Company, as applicable, upon the DTV Group's receipt of any such collateral.
5. REPRESENTATIONS AND WARRANTIES OF SELLER. Each member of the DTV Group
hereby represents and warrants to Purchaser, as of the date hereof and as of
the Closing Date, as follows:
5.1 Organization, Standing, Qualification. Each member of the DTV
Group is a corporation duly organized, validly existing and in good standing
under the Laws of its jurisdiction of incorporation. Each member of the DTV
Group has full corporate power and authority to execute and deliver this
Purchase Agreement and the other Transaction Documents to which it is a party
and to carry out the Contemplated Transactions.
5.2 Authorization. The execution and delivery of, and performance by
each member of the DTV Group under, this Purchase Agreement and the other
Transaction Documents to which it is a party and the consummation by such
Person of the Contemplated Transactions have been duly authorized by all
necessary corporate action on the part of such Person and no other corporate
proceedings on the part of such Person are necessary to authorize this Purchase
Agreement and such other Transactions Documents, or to consummate the
Contemplated Transactions.
5.3 Binding Obligation. This Purchase Agreement and each other
Transaction Document executed or to be executed by each member of the DTV Group
pursuant hereto has been or will be at Closing executed and delivered in
accordance with the provisions thereof, and (assuming such agreements
constitute the legal and binding obligations of each member of the Purchaser
Group, as the case may be) shall each constitute a valid and binding obligation
of each member of the DTV Group signatory thereto enforceable in accordance
with its terms (i) except to the extent that enforceability may be limited by
bankruptcy, insolvency, reorganization, moratorium or other similar Laws now or
hereinafter in effect relating to or affecting creditors' rights generally,
including statutory and other Laws regarding fraudulent conveyances or
preferential transfers, and (ii) subject to the limitations imposed by general
equitable principles regardless of whether such enforceability is considered in
a Proceeding at law or in equity.
5.4 Noncontravention. Neither the execution and the delivery of this
Purchase Agreement or the other Transaction Documents, nor the consummation of
the Contemplated Transactions, will, in any material respect, (a) violate any
provision of the organizational documents of any member of the DTV Group, (b)
violate any provision of applicable Law binding upon any member of the DTV
Group, or (c) conflict with, result in a breach of, constitute a default (or an
event which, with notice or lapse of time, or both, would constitute a default)
under, result in the acceleration of, create in any party the right to
accelerate, terminate, modify, or cancel, or require any notice under any
material Contract, except with respect to clauses (b) and (c), for such
conflicts or violations which would not reasonably be expected to have a
material adverse effect on the ability of the DTV Group to consummate the
Contemplated Transactions.
5.5 Ownership, Sufficiency of and Title to Seller Membership
Interests. Seller is the lawful record and beneficial owner of the Seller
Membership Interests and has good and valid title in and to such Seller
Membership Interests, free and clear of any and all Encumbrances, except for
those Encumbrances set forth in the Investor Rights Agreement, the LLC
Agreement, the First Lien Pledge Agreement and the Second Lien Pledge
Agreement, and except for restrictions imposed by applicable Securities Laws.
The Seller Membership Interests consist of 47,500 Class A Units and include all
of Seller's interests in the Company.
5.6 Seller Sophistication; Excluded Information.
(a) Seller (i) is a Member of the Company, (ii) is a
sophisticated seller with respect to the sale of the Seller Membership
Interests, (iii) provided that the representations and warranties of Purchaser
contained in this Purchase Agreement are true, correct and complete, has
adequate information concerning the business and financial condition of the
Company and its Subsidiaries to make an informed decision regarding the sale of
the Seller Membership Interests and (iv) has independently and without reliance
upon the Purchaser Group, and based on such information as Seller has deemed
appropriate, made its own analysis and decision to enter into this Purchase
Agreement and the other Transaction Documents, except that Seller has relied
upon the Purchaser Group's express representations, warranties, covenants, and
indemnities in this Purchase Agreement. Seller acknowledges that the Purchaser
Group has not given Seller any investment advice, credit information, or
opinion on whether the sale of the Seller Membership Interests is prudent.
(b) Seller acknowledges that (i) the Purchaser Group may
currently have, and later may come into possession of, information with respect
to the Seller Membership Interests, the Company or any of the Company's
Subsidiaries that is not known to Seller and that may be material to a decision
to sell the Seller Membership Interests (the "Seller Excluded Information"),
(ii) Seller has determined to sell the Seller Membership Interests
notwithstanding its lack of knowledge of the Seller Excluded Information and
(iii) the Purchaser Group shall have no liability to Seller, and Seller waives
and releases any claims that it might have against the Purchaser Group whether
under applicable Securities Laws or otherwise, with respect to the
nondisclosure of the Seller Excluded Information in connection with the
transactions contemplated hereby; provided, however, that the Seller Excluded
Information shall not and does not affect the truth or accuracy of the
Purchaser Group's representations or warranties in this Purchase Agreement and
the other Transaction Documents.
5.7 Government Approvals. The execution, delivery, and performance by
each member of the DTV Group of the Transaction Documents to which such Person
is a party requires no action by or in respect of, or consent or approval of,
or filing with any Governmental Authority other than (a) compliance with any
applicable requirements of the Antitrust Laws and competition laws and rules
and regulations thereunder, (b) compliance with any applicable requirements of
the Communications Laws, including notifications to Governmental Authorities
and (c) such other consents or approvals the failure to obtain or make would
not have, individually or in the aggregate, a material adverse effect on the
ability of the DTV Group to consummate the Contemplated Transactions.
6. REPRESENTATIONS AND WARRANTIES OF THE PURCHASER GROUP. Each member of
the Purchaser Group hereby represents and warrants to Seller, as of the date
hereof and as of the Closing Date, as follows:
6.1 Organization, Standing, Qualification. Each member of the
Purchaser Group is a corporation duly organized, validly existing and in good
standing under the Laws of the State of Delaware. Each member of the Purchaser
Group has the full corporate power and authority to execute and deliver this
Purchase Agreement and the other Transaction Documents to which it is a party
and to carry out the Contemplated Transactions.
6.2 Authorization. The execution and delivery of, and performance by
each member of the Purchaser Group under, this Purchase Agreement and the other
Transaction Documents to which it is a party and the consummation by such
Person of the Contemplated Transactions have been duly authorized by all
necessary corporate action on the part of such Person and no other corporate
proceedings on the part of such Person are necessary to authorize this Purchase
Agreement and such other Transactions Documents, or to consummate the
Contemplated Transactions.
6.3 Binding Obligation. This Purchase Agreement and each other
Transaction Document to be executed by each member of the Purchaser Group
pursuant hereto has been or will be at Closing executed and delivered in
accordance with the provisions thereof, and (assuming such agreements
constitute the legal and binding obligations of each member of the DTV Group,
as the case may be) shall each constitute a valid and binding obligation of
each member of the Purchaser Group enforceable in accordance with its terms (a)
except to the extent that enforceability may be limited by bankruptcy,
insolvency, reorganization, moratorium or other similar Laws now or hereinafter
in effect relating to or affecting creditors' rights generally, including
statutory and other Laws regarding fraudulent conveyances or preferential
transfers, and (b) subject to the limitations imposed by general equitable
principles regardless of whether such enforceability is considered in a
Proceeding at law or in equity.
6.4 Noncontravention. Neither the execution and the delivery of this
Purchase Agreement or the other Transaction Documents, nor the consummation of
the Contemplated Transactions, will, in any material respect, (a) violate any
provision of the organizational documents of any member of the Purchaser Group,
(b) violate any provision of applicable Law binding upon any member of the
Purchaser Group, or (c) conflict with, result in a breach of, constitute a
default (or an event which, with notice or lapse of time, or both, would
constitute a default) under, result in the acceleration of, create in any party
the right to accelerate, terminate, modify, or cancel, or require any notice
under any material Contract.
6.5 Purchaser Sophistication; Excluded Information.
(a) Purchaser (i) is an Affiliate of a Member of the Company,
(ii) is a sophisticated purchaser with respect to the purchase of the Seller
Membership Interests, (iii) has adequate information concerning the business
and financial condition of the Company and its Subsidiaries to make an informed
decision regarding the purchase of the Seller Membership Interests and (iv) has
independently and without reliance upon the DTV Group, and based on such
information as Purchaser has deemed appropriate, made its own analysis and
decision to enter into this Purchase Agreement and the other Transaction
Documents, except that Purchaser has relied upon the DTV Group's express
representations, warranties, covenants, and indemnities in this Purchase
Agreement. Purchaser acknowledges that the DTV Group has not given Purchaser
any investment advice, credit information, or opinion on whether the purchase
of the Seller Membership Interests is prudent.
(b) Purchaser acknowledges that (i) the DTV Group may
currently have, and later may come into possession of, information with respect
to the Seller Membership Interests, the Company or any of the Company's
Subsidiaries that is not known to Purchaser and that may be material to a
decision to purchase the Seller Membership Interests (the "Purchaser Excluded
Information"), (ii) Purchaser has determined to purchase the Seller Membership
Interests notwithstanding its lack of knowledge of the Purchaser Excluded
Information and (iii) the DTV Group shall have no liability to Purchaser, and
Purchaser waives and releases any claims that it might have against the DTV
Group whether under applicable Securities Laws or otherwise, with respect to
the nondisclosure of the Purchaser Excluded Information in connection with the
transactions contemplated hereby; provided, however, that the Purchaser
Excluded Information shall not and does not affect the truth or accuracy of the
DTV Group's representations or warranties in this Purchase Agreement and the
other Transaction Documents.
6.6 Financing. Purchaser has, and at Closing will have, sufficient
cash, marketable securities, other investments or capital commitments (the
"Capital Commitment") to enable Purchaser to consummate the Contemplated
Transactions on the terms and conditions set forth in the Transaction
Documents. Simultaneously with, or prior to, the execution and delivery of this
Purchase Agreement, Purchaser has delivered to DTVG a true and correct copy of
the Capital Commitment demonstrating that, upon funding of the Capital
Commitment, Purchaser will have sufficient funds to allow Purchaser to pay the
Purchase Price.
6.7 Securities Law Matters.
(a) Purchaser acknowledges that the Seller Membership
Interests that it is purchasing in accordance with the provisions hereof have
not been and will not be registered or qualified under the Securities Act or
any state securities laws and are offered in reliance upon an exemption from
registration under the Securities Act and state securities laws. Purchaser is
purchasing the Seller Membership Interests for investment purposes only for its
own account, and not with a view to or for sale in connection with any
distribution of the Seller Membership Interests, and Purchaser acknowledges
that the Seller Membership Interests that it will receive cannot be sold or
otherwise disposed of unless they are registered under the Securities Act or
pursuant to an exemption therefrom. Except for an assignment of this Purchase
Agreement to SkyTerra Communications, Inc., as contemplated by Section 12.3,
Purchaser does not have any contract, understanding, agreement or arrangement
with any Person to sell, transfer or grant a participation to such Person or
any other Person, with respect to any or all of the Seller Membership Interests
it is purchasing in accordance with the provisions hereof.
(b) Purchaser is an "accredited investor" within the meaning
of Rule 501 promulgated under the Securities Act and has knowledge and
experience in financial and business matters such that it is capable of
evaluating the merits and risks of receiving and owning the Seller Membership
Interests.
6.8 Government Approvals. The execution, delivery and performance by
Purchaser of the Transaction Documents to which Purchaser is a party requires
no action by or in respect of, or consent or approval of, or filing with any
Governmental Authority other than (a) compliance with any applicable
requirements of the Antitrust Laws and competition laws and rules and
regulations thereunder, (b) compliance with any applicable requirements of the
Communications Laws, including notification to Governmental Authorities and (c)
such other consents or approvals the failure to obtain or make would not have,
individually or in the aggregate, a material adverse effect on the ability of
Purchaser to consummate the Contemplated Transactions.
7. CLOSING.
7.1 Condition Precedent to Obligations of Each Party. The obligations
of Seller and Purchaser to consummate Closing are subject to the satisfaction
(or waiver by each of Purchaser and Seller) of the following condition:
(a) No Order of any U.S. federal or state (but not local)
Governmental Authority that restrains, invalidates or prohibits the
Contemplated Transactions shall be in effect;
(b) The Governmental Authorities listed on Schedule 7.1(b)
shall have cleared the Contemplated Transactions either by issuing a clearance
decision or through the expiration of any applicable waiting period; and
(c) Prior to the Closing, neither SkyTerra nor the Company
shall have made any claim for indemnification under Section 9.2(a) of the
Contribution Agreement which, after giving effect to any materiality
qualifications or basket thresholds set forth therein, would reasonably be
expected to result in an indemnity payment to be made by SkyTerra to DTVG or
Seller, or by DTVG to the Company or SkyTerra; provided that the foregoing
shall not include any claim for indemnification that has been satisfied or
otherwise resolved in accordance with the terms of the Contribution Agreement.
7.2 Conditions Precedent to Obligations of Purchaser. The obligation
of Purchaser to consummate Closing is subject to the satisfaction (or waiver by
Purchaser) of the following conditions:
(a) (i) Each member of the DTV Group shall have performed and
complied in all material respects with their respective obligations under this
Purchase Agreement required to be performed or complied with by them at or
prior to Closing, except for such obligations which are qualified by
materiality in which case such obligations shall have been performed and
complied with in all respects (taking into account any materiality qualifier
contained therein), (ii) each of the representations and warranties of the DTV
Group contained in this Purchase Agreement shall be true and correct at and as
of the date of this Purchase Agreement and as of the Closing Date, as if made
at and as of each such date, in each case except for inaccuracies or omissions
that in the aggregate would not reasonably be expected to have a Material
Adverse Effect on the DTV Group's ability to consummate the Contemplated
Transactions, and (iii) Purchaser shall have received a certificate signed by
an officer of Seller to the foregoing effect;
(b) Since the date hereof, there shall not have occurred and
there shall not exist any event or circumstance that has had or is reasonably
likely to have a Material Adverse Effect on the Company, other than any event
or circumstance caused directly by (i) the gross negligence or willful
misconduct of Purchaser or, at the direction of its Managing Member (as defined
in the LLC Agreement), the Company or (ii) actions intentionally taken in bad
faith by Purchaser or, at the direction of its Managing Member, the Company in
an effort to cause this Section 7.2(b) not to be satisfied; and
(c) Each member of the DTV Group shall have executed and
delivered, on or before the Closing Date, the Transaction Documents that are
required to be executed by such Person, and Seller shall have delivered or
caused to be delivered all other closing deliverables set forth in Section 7.4.
7.3 Conditions Precedent to Obligation of Seller. The obligation of
Seller to consummate Closing is subject to the satisfaction (or waiver by
Seller) of the following conditions:
(a) (i) Each member of the Purchaser Group shall have
performed and complied in all material respects with its obligations under this
Purchase Agreement required to be performed or complied with by it at or prior
to Closing, except for such obligations which are qualified by materiality in
which case such obligations shall have been performed and complied with in all
respects (taking into account any materiality qualifier contained therein),
(ii) the representations and warranties of the Purchaser Group contained in
this Purchase Agreement shall be true and correct at and as of the date of this
Purchase Agreement and as of the Closing Date, as if made at and as of each
such date, in each case except for inaccuracies or omissions that in the
aggregate would not reasonably be expected to have a Material Adverse Effect on
the Purchaser Group's ability to consummate the Contemplated Transactions and
(iii) Seller shall have received a certificate signed by an officer of
Purchaser to the foregoing effect;
(b) All DTV Letters of Credit shall have been terminated or
back-to-back letters of credit, in a form reasonably acceptable to DTVG, shall
have been issued to the DTV Group in connection therewith, and all collateral
of the DTV Group (including any restricted cash, if any) that was supporting or
securing in whole or in part any such DTV Letters of Credit shall have been
delivered to DTVG; and
(c) Each member of the Purchaser Group shall have executed
and delivered, on or before the Closing Date, the Transaction Documents that
are required to be executed by such Person; and Purchaser and the Company shall
have delivered or caused to be delivered all other closing deliverables set
forth in Section 7.5 and Section 7.6.
7.4 Deliveries by Seller. At Closing, Seller shall deliver, or cause
to be delivered, to Purchaser the following:
(a) Copies of the board, stockholder and any other corporate
resolution required in order to approve the consummation of the Contemplated
Transactions, certified by an authorized officer of Seller;
(b) The certificate contemplated by Section 7.2(a) signed by
an executive officer of Seller;
(c) Written resignations of all DTV Group-nominated directors
of the Company and its Subsidiaries dated as of or prior to the Closing;
(d) A certificate of Seller complying with the Code and
treasury regulations promulgated thereunder, in form and substance reasonably
acceptable to Purchaser, certifying that the Contemplated Transactions hereby
are exempt from withholding under Section 1445 of the Code;
(e) Assignment and Assumption of Membership Interests
Agreement, substantially in the form attached hereto as Exhibit A (the
"Assignment and Assumption of Membership Interests Agreement"), executed by an
authorized officer of Seller;
(f) The Amended and Restated DIRECWAY Agreement,
substantially in the form attached hereto as Exhibit B (the "Amended and
Restated DIRECWAY Agreement"), executed by an authorized officer of DIRECTV,
Inc., a California corporation;
(g) Amendment to Spaceway Technical Services Agreement,
substantially in the form attached hereto as Exhibit C (the "Spaceway TSA
Amendment"), executed by an authorized officer of DTVG;
(h) Amended and Restated Transition Services Agreement
substantially in the form attached hereto as Exhibit D (the "Amended and
Restated TSA"), executed by a authorized officer of DTVG;
(i) The Ethiopian Subcontracting Agreement, substantially in
the form attached hereto as Exhibit E (the "Ethiopian Subcontract") executed by
an authorized officer of the Company; and
(j) Such other documents as Purchaser may reasonably request
in accordance herewith to consummate the Contemplated Transactions.
7.5 Deliveries by Purchaser. At Closing, Purchaser or its assignee, as
the case may be, shall deliver, or cause to be delivered, to Seller the
following:
(a) Payment of the Purchase Price in immediately available
funds;
(b) Copies of the resolutions of Purchaser approving the
consummation of the Contemplated Transactions certified by an authorized
officer of Purchaser;
(c) The certificate contemplated by Section 7.3(a) signed by
an executive officer of Purchaser;
(d) Assignment and Assumption of Membership Interests
Agreement, executed by an authorized officer of Purchaser;
(e) The Amended and Restated DIRECWAY Agreement, executed by
an authorized officer of the Company;
(f) The Spaceway TSA Amendment, executed by an authorized
officer of the Company;
(g) The Amended and Restated TSA, executed by an authorized
officer of the Company;
(h) The Ethiopian Subcontract, executed by an authorized
officer of the Company; and
(i) Such other documents as Seller may reasonably request in
accordance herewith to consummate the Contemplated Transactions.
7.6 Deliveries by the Company. At Closing, the Company shall deliver,
or cause to be delivered, to Seller the following:
(a) Payment of the payments described in Sections 8.1(a)(i)
and 8.1(a)(ii) in immediately available funds; and
(b) Such other documents as Seller may reasonably request in
accordance herewith to consummate the Contemplated Transactions.
8. CHANGES TO PRIOR AGREEMENTS; RELATED MATTERS.
8.1 Contribution Agreement.
(a) Working Capital; Cash Balance.
(i) Only if the Closing occurs, the Final Working Capital
Amount (as defined in the Contribution Agreement) shall be deemed to be One
Hundred and Seventy-Four Million Dollars ($174,000,000) and therefore the
Company (and not any member of the Purchaser Group) shall pay to Seller at
Closing a payment of Six Million Dollars ($6,000,000) in satisfaction of all
obligations of the Company pursuant to Section 2.10 of the Contribution
Agreement.
(ii) Only if the Closing occurs, the Company (and not any
member of the Purchaser Group) shall pay to Seller a payment of Four Million
Dollars ($4,000,000) because the Closing Cash Balance exceeded the Cash Target
Amount as of the Closing Date (as each such term is defined in the Contribution
Agreement).
(iii) Subject to Section 8.1(a)(i) above, and
notwithstanding anything to the contrary in the Contribution Agreement, the
thirty (30) day period in which the Company and Seller are required to endeavor
to resolve their dispute regarding the Final Working Capital Statement shall
begin on the date of termination of this Purchase Agreement pursuant to Section
11.
(iv) In the event the Closing does occur, this Section
8.1 shall be deemed to be the final resolution of the Final Working Capital
Amount and the Closing Cash Balance.
(b) Representations and Warranties. Notwithstanding anything
to the contrary contained in the Contribution Agreement, the representations
and warranties of the Company contained in Section 4 of the Contribution
Agreement (except for those representations and warranties of the Company
contained in Sections 4.1, 4.2, 4.3, 4.4, 4.9, 4.10, 4.11, 4.22 and 4.23 of the
Contribution Agreement), and the associated indemnity with respect thereto set
forth in Section 9 of the Contribution Agreement, shall be deemed to terminate
as of the Closing Date. The provisions of this Section 8.1(b) shall become
effective only if the Closing occurs.
(c) Effect If Closing Does Not Occur. In the event the
Closing does not occur, nothing contained in this Purchase Agreement shall be
deemed to be an admission or acknowledgment by any party hereto of any rights
or liabilities that any party hereto may have under the Contribution Agreement
or the other Transaction Documents (as such term is defined in the Contribution
Agreement), and in particular (but not in limitation of the generality of the
foregoing) with respect to the determination of the Final Working Capital
Amount and any refund of the Closing Cash Balance.
8.2 Investor Rights Agreement. At the Closing, the Investor Rights
Agreement and the Investor Rights Agreement Side Letter shall automatically
terminate in their entirety and shall be void and of no further force or
effect.
8.3 LLC Agreement.
(a) From and after the Closing, Seller will cease to be a
Member under the LLC Agreement and shall have no further powers, rights, and
privileges as a Member under the LLC Agreement. Seller hereby further agrees
that as of the Closing, Seller unconditionally and irrevocably releases,
acquits and forever discharges the Purchaser Group and the Company from all
liabilities, claims, demands, actions, or causes of action of any kind (if any
there be, known or unknown), whether absolute or contingent, due or to become
due, disputed, or undisputed, at law or in equity that Seller now has or ever
had against the Purchaser Group or the Company under the LLC Agreement or as a
Member. Seller agrees to execute and deliver any document reasonably requested
by the Purchaser Group to amend the LLC Agreement consistent with the terms of
this Section 8.3. Nothing in this Section 8.3 shall: (i) relieve any member of
the DTV Group of its obligations under Sections 7.14 and 8.6 of the LLC
Agreement, as in effect on the date hereof and notwithstanding any future
amendments, modifications, supplements or restatements thereto, or (ii) relieve
the Company or any other Member under the LLC Agreement of their respective
obligations under Sections 5.8, 6.1, 6.2, 7.7, 7.11 and 8.6 of the LLC
Agreement, as in effect on the date hereof and notwithstanding any future
amendments, modifications, supplements or restatements thereto.
(b) The Company expressly agrees that all rights to
indemnification provided under Section 7.11 of the LLC Agreement (as in effect
on the date hereof and notwithstanding any future amendments, modifications,
supplements or restatements thereto) for the benefit of Seller, any Board
Member (as defined in the LLC Agreement) nominated by Seller, any officer of
Seller or Affiliate thereof shall continue as provided in the LLC Agreement,
shall survive the Closing and shall continue in full force and effect in
accordance with their terms.
8.4 Preservation of Rights. Except as provided in this Section 8 or as
otherwise specifically set forth in this Purchase Agreement, nothing in this
Purchase Agreement shall be construed as affecting the rights,
responsibilities, obligations or remedies of Seller, Purchaser, SkyTerra, the
Company, DTVG or any of their respective Affiliates arising under the
Contribution Agreement or the other Transaction Documents (as such term is
defined in the Contribution Agreement) or any other letter agreement or other
agreements among the Parties; provided, however, that any covenant or
obligation in such agreements of any member of the DTV Group to cause (or use
efforts to cause) the Company or any of the Company's Subsidiaries to take any
action or refrain from taking any action shall automatically terminate at the
Closing.
8.5 Release of Board Members.
(a) The Purchaser Group hereby agrees that as of the Closing,
each member of the Purchaser Group unconditionally and irrevocably releases,
acquits and forever discharges the DTVG Board Members (as such term is defined
in the LLC Agreement) from all liabilities, claims, demands, actions, or causes
of action of any kind (if any there be, known or unknown), whether absolute or
contingent, due or to become due, disputed, or undisputed, at law or in equity
that the Purchaser Group now has or ever had against the DTVG Board Members as
a result of the DTVG Board Members' service as Board Members (as such term is
defined in the LLC Agreement).
(b) Seller hereby agrees that as of the Closing, Seller
unconditionally and irrevocably releases, acquits and forever discharges the
Managing Member and the SkyTerra Board Members (as such terms are defined in
the LLC Agreement) from all liabilities, claims, demands, actions, or causes of
action of any kind (if any there be, known or unknown), whether absolute or
contingent, due or to become due, disputed, or undisputed, at law or in equity
that Seller now has or ever had against the Managing Member and the SkyTerra
Board Members as a result of the Managing Member's and the SkyTerra Board
Members' service as Managing Member and Board Members (as such terms are
defined in the LLC Agreement), respectively.
9. SURVIVAL OF REPRESENTATIONS; INDEMNIFICATION; REMEDIES.
9.1 Survival of Representations; Exclusive Remedy.
(a) The representations and warranties of the DTV Group and
the Purchaser Group contained in this Purchase Agreement shall survive the
Closing Date without any time limit; provided, however, that the
representations and warranties with respect to Sections 5.4, 5.7, 6.4, 6.6, 6.7
and 6.8 shall terminate and expire on December 31, 2006, except with respect to
(i) any claims as to which written notice identifying such claim and the basis
thereof with reasonable specificity shall have been delivered pursuant to the
applicable provisions of this Purchase Agreement on or prior to such date, in
which case, such claims shall survive until the final resolution thereof and
(ii) any claims related to fraud or willful misconduct. The covenants and other
agreements of the DTV Group and the Purchaser Group contained in this Purchase
Agreement shall survive the Closing Date until they are otherwise terminated,
whether by their express terms or as a matter of applicable Law.
(b) Subject to specific performance and other injunctive
relief pursuant to Section 12.15, indemnification pursuant to this Section 9
shall be the sole and exclusive remedy for any breach of representations and
warranties or of any covenant or agreement in this Purchase Agreement by any
party or any other matter pertaining to this Purchase Agreement or the
Contemplated Transactions; provided that the forgoing limitation shall not
apply with respect to claims of fraud or willful misconduct.
9.2 Agreement of DTVG to Indemnify. DTVG shall indemnify, defend and
hold harmless the Purchaser Indemnified Persons from and against any and all
Damages incurred or suffered by the Purchaser Indemnified Persons arising out
of, relating to or in connection with any (a) breach of any representation or
warranty, determined without regard to any materiality qualifiers contained in
this Purchase Agreement, in any other Transaction Document or in any
certificate delivered in connection herewith or therewith, or (b) noncompliance
with any covenant or other written agreements, in each case, given or made by
the DTV Group in this Purchase Agreement, in any other Transaction Document or
in any certificate delivered in connection herewith or therewith.
9.3 Agreement of Purchaser to Indemnify. Purchaser shall indemnify,
defend and hold harmless the Seller Indemnified Persons from and against any
and all Damages incurred or suffered by the Seller Indemnified Persons arising
out of, relating to or in connection with any (a) breach of any representation
or warranty, determined without regard to any materiality qualifiers contained
in this Purchase Agreement, in any other Transaction Document or in any
certificate delivered in connection herewith or therewith, or (b) noncompliance
with any covenants or other written agreements, in each case, given or made by
the Purchaser Group in this Purchase Agreement, in any other Transaction
Document or in any certificate delivered in connection herewith or therewith.
9.4 Limits of Indemnification.
(a) DTVG shall not be liable to the Purchaser Indemnified
Persons in respect of any indemnification pursuant to Section 9.2(a) until the
aggregate Damages of the Purchaser Indemnified Persons exceed an amount equal
to Five Million Dollars ($5,000,000) (the "Basket Amount"), and then Purchaser
Indemnified Persons shall only be entitled to the aggregate Damages in excess
of the Basket Amount; provided, however, that the Basket Amount shall not apply
to claims for indemnification based on (i) breaches of representations and
warranties made pursuant to Sections 5.1, 5.2, 5.3, 5.5 or 5.6 or (ii) fraud or
willful misconduct.
(b) The parties acknowledge and agree that the maximum
aggregate liability of DTVG pursuant to Section 9.2(a) shall not exceed an
amount equal to Sixty Million Dollars ($60,000,000) (the "Cap Amount");
provided, however, that the Cap Amount shall not apply to claims for
indemnification based on (i) breaches of representations and warranties made
pursuant to Sections 5.1, 5.2, 5.3, 5.5 or 5.6 or (ii) fraud or willful
misconduct.
(c) Purchaser shall not be liable to the Seller Indemnified
Persons in respect of any indemnification pursuant to Section 9.3(a) until the
aggregate Damages of the Seller Indemnified Persons exceed an amount equal to
the Basket Amount, and then Seller Indemnified Persons shall only be entitled
to the aggregate Damages in excess of the Basket Amount; provided, however,
that the Basket Amount shall not apply to claims for indemnification based on
(i) breaches of representations and warranties made pursuant to Sections 6.1,
6.2, 6.3 or 6.5 or (ii) fraud or willful misconduct.
(d) The parties acknowledge and agree that the maximum
aggregate liability of Purchaser pursuant to Section 9.3(a) shall not exceed an
amount equal to the Cap Amount; provided, however, that the Cap Amount shall
not apply to claims for indemnification based on (i) breaches of
representations and warranties made pursuant to Sections 6.1, 6.2, 6.3 or 6.5
or (ii) fraud or willful misconduct.
9.5 Conditions of Indemnification.
(a) If any Purchaser Indemnified Person shall seek
indemnification pursuant to Section 9.2, or if any Seller Indemnified Person
shall seek indemnification pursuant to Section 9.3, the party seeking
indemnification (the "Indemnified Party") shall give written notice to the
party from whom such indemnification is sought (the "Indemnifying Party")
promptly (and in any event within sixty (60) days) after the Indemnified Party
(or, if the Indemnified Party is a corporation, any officer or director of the
Indemnified Party) becomes aware that a claim for indemnification (an
"Indemnified Claim") may be made, specifying in reasonable detail the factual
basis of the Indemnified Claim, stating the amount of the Damages, if known,
the method of computation thereof, containing a reference to the provision of
this Purchaser Agreement in respect of which such Indemnified Claim arises and
demanding indemnification therefor. The failure of an Indemnified Party to
provide notice in accordance with this Section 9.5, or any delay in providing
such notice, shall not constitute a waiver of that party's claims to
indemnification pursuant to this Section 9, except to the extent that (i) any
such failure or delay in giving notice causes the amounts paid or to be paid by
the Indemnifying Party to be greater than they otherwise would have been (in
which case, only the excess amount of such claim resulting from such delay
shall be waived) or otherwise results in prejudice to the Indemnifying Party or
(ii) if such notice is not delivered to the Indemnifying Party prior to the
expiration of the applicable survival period, if any, set forth in Section 9.1.
If the Indemnified Claim arises from the assertion of any claim, or the
commencement of any Proceeding brought by a Person that is not a party hereto
(a "Third Party Claim"), any such notice to the Indemnifying Party shall be
accompanied by a copy of any documents theretofore served on or delivered to
the Indemnified Party in connection with such Third Party Claim (a "Third Party
Claim Notice").
(b) The Indemnifying Party shall have twenty (20) days from
delivery of the Third Party Claim Notice to notify the Indemnified Party
whether or not the Indemnifying Party elects to defend the Indemnified Party
against such Third Party Claim. In the event that the Indemnifying Party
notifies the Indemnified Party that it elects to defend the Indemnified Party
against such Third Party Claim and acknowledges its obligations to indemnify
the Indemnified Party in full hereunder in connection with such Third Party
Claim, the Indemnifying Party shall have the right to defend the Indemnified
Party by appropriate proceedings and shall control such defense at the
Indemnifying Party's expense unless (i) the claim seeks only an injunction or
other equitable relief, (ii) the Indemnified Party shall have been advised by
counsel that there are one or more legal or equitable defenses available to it
which are different from or in addition to those available to the Indemnifying
Party and, in the reasonable opinion of the Indemnified Party, counsel for the
Indemnifying Party could not adequately represent the interests of the
Indemnified Party because such interests could be in conflict with those of the
Indemnifying Party, (iii) such Proceeding could have a material effect on any
material matter beyond the scope of the indemnification obligation of the
Indemnifying Party or (iv) the Indemnifying Party shall not have assumed the
defense of the third party claim within the foregoing twenty (20) day period.
After notice to the Indemnified Party of the Indemnifying Party's election to
assume the defense of such Third Party Claim, the Indemnifying Party shall not
be liable to the Indemnified Party for any legal expenses subsequently incurred
by the Indemnified Party in connection with the defense thereof unless the
Indemnifying Party fails to diligently pursue the defense of such Third Party
Claim; provided that the Indemnified Party shall have the right to employ
counsel to represent it. If the Indemnifying Party elects not to defend the
Indemnified Party against such Third Party Claim, then the Indemnified Party
may (but is not obligated to) defend such Third Party Claim by appropriate
Proceedings and may (but is not obligated to) control such defense, at the
expense of the Indemnifying Party.
(c) The parties shall render to each other such assistance as
may reasonably be requested in order to insure the proper and adequate defense
of any such Third Party Claim, including making employees available (with
reasonable prior notice) during normal business hours to provide additional
information and explanation of any relevant materials or to testify at any
Proceedings relating to such Third Party Claim and giving the other party
reasonable access to any books, records and other documents and information
relating to the defense of such Third Party Claim. The Indemnifying Party shall
reimburse the out-of-pocket costs and expenses reasonably incurred by the
Indemnified Party in providing such assistance.
(d) The Indemnifying Party will not consent to the entry of
any Order or enter into any settlement with respect to a Third Party Claim
without the prior written consent of the Indemnified Party, unless the Order
(x) involves only the payment of money damages and (y) includes as a term
thereof the giving by the claimant or plaintiff to the Indemnified Party of an
unconditional release from all Liability in respect of the Third Party Claim.
(e) Any obligation by an Indemnifying Party to indemnify an
Indemnified Party shall be satisfied in cash. The DTV Group hereby waives any
right to seek indemnification or contribution from the Company for Damages as a
result of any breach by the Company of any representation, warranty or any
covenant or other agreement to be performed prior to Closing contained in this
Purchase Agreement or any other Transaction Document.
10. TAX MATTERS.
10.1 Closing of the Books. The Parties agree that pursuant to Section
706(c) of the Code the taxable year of the Company should close with respect to
Seller, and Seller shall be allocated items of income, gain, loss or deduction
based on an interim closing of the Company's books as of the Closing Date.
10.2 Cooperation. Each of the Parties agrees to cooperate as and to
the extent reasonably requested by the other Parties, in connection with the
filing of any Tax Returns and any audit, litigation or other proceeding with
respect to Taxes, including making available employees and such information and
records which are reasonably relevant to such filing, audit, litigation or
other proceeding. In connection therewith, Purchaser shall provide to Seller
reasonable written notice prior to transferring, destroying or discarding any
such books and records, and if requested by Seller, shall transfer any such
books and records to the Seller.
11. TERMINATION.
11.1 Termination. This Purchase Agreement may be terminated at any
time prior to Closing:
(a) by Purchaser if (i) a material breach of any provision of
this Purchase Agreement has been committed by the DTV Group and such breach has
not been (A) cured by the DTV Group within thirty (30) days after notice
thereof given by Purchaser to the DTV Group to the extent that such breach is
capable of being cured or (B) waived in writing by Purchaser or (ii) if any of
the conditions set forth in Sections 7.1 or 7.2 shall have been incapable of
fulfillment and shall not have been waived by Purchaser;
(b) by Seller if (i) a material breach of any provision of
this Purchase Agreement has been committed by the Purchaser Group and such
breach has not been (A) cured by the Purchaser Group within thirty (30) days
after notice thereof given by Seller to the Purchaser Group to the extent that
such breach is capable of being cured or, (B) waived in writing by Seller or
(ii) any of the conditions set forth in Sections 7.1 or 7.3 shall have been
incapable of fulfillment and shall not have been waived by Seller;
(c) by mutual written consent of Purchaser and Seller;
(d) by Purchaser, if Closing has not occurred on or before
March 10, 2006 (or such later date as the Parties may agree upon in writing,
the "Outside Date"), unless Purchaser is in material breach of this Purchase
Agreement;
(e) by Seller, if Closing has not occurred on or before the
Outside Date, unless Seller is in material breach of this Purchase Agreement;
or
(f) by either Seller or Purchaser, if:
(i) five (5) business days shall have elapsed following
such time as any permanent injunction or other similar order of a court of
competent jurisdiction or other competent U.S. federal or state (but not local)
Governmental Authority preventing the consummation of the Contemplated
Transactions shall have been entered (so long as such permanent injunction or
similar order is still in effect at the expiration of such five (5) business
day period), regardless of whether such order is appealable or has been
appealed and, prior to such termination, the Parties and their respective
Affiliates shall have used commercially reasonable efforts to resist, resolve
or lift, as applicable, such injunction or other similar order.
If Seller or Purchaser desires to terminate this Purchase Agreement pursuant to
this Section 11.1, such Person shall give written notice of such termination to
the other.
11.2 Effect of Termination. If this Purchase Agreement is terminated
as permitted by Section 11.1, (a) this Purchase Agreement shall forthwith
become void and of no further force and effect, except for the following
provisions, which shall remain in full force and effect: Section 4.2, Section
4.3, Section 8.1(a)(iii), Section 8.1(c), Section 11 and Section 12; and (b)
such termination shall be without Liability of any signatory hereto (or any
Affiliate, stockholder, consultant or Representative of such Person) to any
other signatory hereto; provided, however, that if the Contemplated
Transactions fail to close as a result of a breach of the provisions of this
Purchase Agreement by any signatory hereto, such Person shall be liable for any
and all Damages incurred or suffered by the other Person as a result of all
such breaches. The rights and remedies provided in this Section 11.2 shall be
cumulative and not exclusive of any rights or remedies provided by applicable
Law.
11.3 Preservation of Rights Under Contribution Agreement Following
Termination. Subject to Section 11.2, if the Closing does not occur, the
Parties shall have all rights and remedies available to each Party under the
Contribution Agreement and the other Transaction Documents (as such term is
defined in the Contribution Agreement) without giving effect to any of the
provisions of this Purchase Agreement or any other Transaction Document.
12. MISCELLANEOUS.
12.1 Additional Actions and Documents. From time to time, whether
before, at, or after Closing, each party hereto will take or cause to be taken
such further reasonable actions and to execute, deliver and file or cause to be
executed, delivered and filed such further reasonable documents, in each case,
in order to fully effectuate the purposes, intents, terms and conditions of
this Purchase Agreement and the Contemplated Transactions.
12.2 Expenses. Subject to the indemnity provisions of Section 9, each
Party hereto shall pay its own expenses incident to this Purchase Agreement,
the other Transaction Documents and the Contemplated Transactions, including
all legal and accounting fees and disbursements. In the event this Purchase
Agreement is terminated pursuant to Section 11, neither the DTV Group's nor the
Purchaser Group's expenses shall be reimbursable by the Company.
12.3 Assignment. No party hereto shall assign its rights and
obligations under this Purchase Agreement, in whole or in part, whether by
operation of law or otherwise, without the prior written consent of each of the
other Parties hereto, except that (i) Seller may assign its rights and
obligations under this Purchase Agreement (except for obligations under Section
2) to DTVG and (ii) Purchaser may, by delivering written notice to Seller,
assign its rights under this Purchase Agreement and the other Transaction
Documents, in whole or in part, to SkyTerra or any wholly-owned Subsidiary of
Purchaser (unless such assignment would reasonably be expected to result in
additional regulatory filings (other than ministerial filings) that would delay
the Closing); provided that no such assignment shall prior to the consummation
of the Contemplated Transactions, (x) relieve the Purchaser Group of its
obligations under Section 2 or (y) relieve the Company of its obligations under
Sections 8.1(a)(i) and 8.1(a)(ii). Except as set forth herein, upon delivery of
such notice to Seller, SkyTerra Holdings, Inc. shall automatically be released
from all of its obligations under this Purchase Agreement and the Transaction
Documents. Any purported assignment or other disposition, except as permitted
herein, shall be null and void. Except as specifically set forth herein, in no
event shall the assignment by Seller or Purchaser of such party's respective
rights or obligations under this Purchase Agreement, whether before, at or
after Closing, release such Party from such Party's respective liabilities and
obligations hereunder.
12.4 Entire Agreement; Amendment.
(a) All exhibits and schedules to this Purchase Agreement are
hereby incorporated by reference into, and made a part of, this Purchase
Agreement. Subject to Section 8.4, this Purchase Agreement, the exhibits,
schedules and other Transaction Documents referred to herein or furnished
pursuant hereto, constitute the entire agreement among the DTV Group and the
Purchaser Group with respect to the Contemplated Transactions and supersede all
prior oral or written agreements, commitments or understandings, with respect
to the matters provided for herein.
(b) No amendment, modification or discharge of this Purchase
Agreement shall be valid or binding unless set forth in writing and duly
executed and delivered by the DTV Group and the Purchaser Group.
12.5 Waiver. No delay or failure on the part of any party hereto in
exercising any right, power or privilege under this Purchase Agreement or under
any other documents furnished in connection with or pursuant to this Purchase
Agreement (including the other Transaction Documents) shall impair any such
right, power or privilege or be construed as a waiver of any default or any
acquiescence therein. No single or partial exercise of any such right, power or
privilege shall preclude the further exercise of such right, power or
privilege, or the exercise of any other right, power or privilege. No waiver
shall be valid against any party hereto unless made in writing and signed by
the party against whom enforcement of such waiver is sought and then only to
the extent expressly specified therein. To the extent that the consent of the
DTV Group or the Purchaser Group is required pursuant to this Purchase
Agreement, such consent may not be unreasonably withheld, conditioned or
delayed.
12.6 Severability. If any part of any provision of this Purchase
Agreement or any other agreement or document given pursuant to or in connection
with this Purchase Agreement (including the other Transaction Documents) shall
be invalid or unenforceable in any respect, such part shall be ineffective to
the extent of such invalidity or unenforceability only, without in any way
affecting the remaining parts of such provision or the remaining provisions of
this Purchase Agreement or other such document.
12.7 Governing Law. This Purchase Agreement, the rights and
obligations of the parties hereto, and any claims or disputes relating thereto,
shall be governed by and construed in accordance with the Laws of the State of
New York (excluding the choice of law rules thereof, other than Section 5-1401
of the New York General Obligations Law).
12.8 Notices. All notices, demands, requests, or other communications
which may be or are required to be given, served, or sent by any party to any
other party pursuant to this Purchase Agreement or another Transaction Document
shall be in writing and shall be hand delivered, sent by overnight courier or
mailed by first-class, registered or certified mail, return receipt requested,
postage prepaid, addressed as follows:
(i) If to the DTV Group:
DTV Network Systems, Inc.
c/o The DIRECTV Group, Inc.
0000 Xxxx Xxxxxxxx Xxxxxxx
Xx Xxxxxxx, XX 00000
Attn.: Xxxxx X. Xxxxxx, Esq.
Telecopy No.: 000-000-0000
with copies (which shall not constitute notice) to:
Xxxxx & Xxxxxxx L.L.P.
0000 Xxxxxxxxxx Xxxxx
XxXxxx, XX 00000
Attn.: Xxxxxxx X.X. Xxxxxx, Esq.
Telecopy No.: 000-000-0000
(ii) If to Purchaser:
SkyTerra Holdings, Inc.
00 Xxxx 00xx Xxxxxx, Xxxxx 000
Xxx Xxxx, Xxx Xxxx 00000
Attn.: Xxxxxxx Xxxxx
Telecopy No.: 000-000-0000
with copies (which shall not constitute notice) to:
O'Melveny & Xxxxx LLP
0000 Xxx Xxxxxx, X.X.
Xxxxxxxxxx, XX 00000
Attn.: Xxxxx X. Xxxxxxxxxxx
Telecopy No.: 000-000-0000
Each Party may designate by notice in writing a new address to which
any notice, demand, request or communication may thereafter be so given, served
or sent. Each notice, demand, request, or communication which shall be hand
delivered, sent or mailed in the manner described above shall be deemed
sufficiently given, served, sent, received or delivered for all purposes at
such time as it is delivered to the addressee (with the return receipt or the
delivery receipt being deemed conclusive, but not exclusive, evidence of such
delivery) or at such time as delivery is refused by the addressee upon
presentation.
12.9 Headings. Section headings contained in this Purchase Agreement
are inserted for convenience of reference only, shall not be deemed to be a
part of this Purchase Agreement for any purpose, and shall not in any way
define or affect the meaning, construction or scope of any of the provisions
hereof.
12.10 Interpretation; Absence of Presumption.
(a) For the purposes hereof, (i) words in the singular shall
be held to include the plural and vice versa and words of one gender shall be
held to include the other gender as the context requires, (ii) the terms
"hereof," "herein," and "herewith" and words of similar import shall, unless
otherwise stated, be construed to refer to this Purchase Agreement as a whole
(including all of the exhibits and schedules hereto) and not to any particular
provision of this Purchase Agreement, and article, section, paragraph, exhibit
and schedule references are to the articles, sections, paragraphs, exhibits and
schedules of this Purchase Agreement unless otherwise specified, (iii) the word
"including" and words of similar import when used in this Purchase Agreement
shall mean "including, without limitation," unless the context otherwise
requires or unless otherwise specified, (iv) the word "or" shall not be
exclusive, (v) where specific language is used to clarify or illustrate by
example a general statement contained herein, such specific language shall not
be deemed to modify, limit or restrict the construction of the general
statement which is being clarified or illustrated and (vi) "the date hereof"
means November 10, 2005.
(b) This Purchase Agreement shall be construed without regard
to any presumption or rule requiring construction or interpretation against the
party drafting or causing any agreement, instrument or document to be drafted.
12.11 Execution in Counterparts. To facilitate execution, this
Purchase Agreement may be executed in as many counterparts as may be required.
It shall not be necessary that the signatures of, or on behalf of, each party,
or that the signatures of all Persons required to bind any party, appear on
each counterpart; but it shall be sufficient that the signature of, or on
behalf of, each party, or that the signatures of the Persons required to bind
any party, appear on one or more of the counterparts. All counterparts shall
collectively constitute a single agreement. It shall not be necessary in making
proof of this Purchase Agreement to produce or account for more than a number
of counterparts containing the respective signatures of, or on behalf of, all
of the parties hereto. This Purchase Agreement may be executed through delivery
of duly executed signature pages by facsimile or electronic mail.
12.12 Limitation on Benefits. The covenants, undertakings and
agreements set forth in this Purchase Agreement shall be solely for the benefit
of, and shall be enforceable only by, the DTV Group and the Purchaser Group and
their respective successors, heirs, executors, administrators, legal
representatives and permitted assigns, except that the agreements set forth in
Section 9 also shall be for the benefit of, and enforceable by, Purchaser
Indemnified Persons, Seller Indemnified Persons and their respective
successors, heirs, executors, administrators, legal representatives and
permitted assigns.
12.13 Binding Effect. Subject to Section 12.3, this Purchase Agreement
shall be binding upon and shall inure to the benefit of the Parties and their
respective successors, heirs, executors, administrators, legal representatives
and assigns.
12.14 Jurisdiction. This Purchase Agreement and the duties and
obligations of the parties hereto and each of the other Transaction Documents
referred to herein shall be enforceable against the parties hereto or thereto
in the courts of the United States of America, and of the State of New York,
having jurisdiction over New York County, New York. For such purpose, the
parties hereto hereby irrevocably submit to the non-exclusive jurisdiction of
such courts, and agree that all claims in respect of this Purchase Agreement
and such other Transaction Documents may be heard and determined in any of such
courts. The parties hereto hereby irrevocably agree that a final judgment of
any of the courts specified above in any action or proceeding relating to this
Purchase Agreement or to any of the other documents referred to herein shall be
conclusive and may be enforced in other jurisdictions by suit on the judgment
or in any other manner provided by Law.
12.15 Provisional Relief; Specific Performance. Notwithstanding
anything to the contrary herein, the parties hereto agree that irreparable
damage would occur in the event that any of the provisions of this Purchase
Agreement or the other Transaction Documents are not performed in accordance
with their specific terms or were otherwise breached. Accordingly, it is agreed
that the parties hereto shall be entitled to seek an injunction or injunctions
to prevent breaches of this Purchase Agreement or the other Transaction
Documents and to enforce specifically the terms and provisions of this Purchase
Agreement or the other Transaction Documents in any state or federal court of
the State of New York, in addition to any other remedy to which they are
entitled at law or in equity, and the parties hereto hereby submit to the
jurisdiction of such courts.
12.16 Waiver of Jury Trial.
EACH PARTY ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY THAT MAY ARISE
UNDER THIS PURCHASE AGREEMENT OR ANY OTHER TRANSACTION DOCUMENT IS LIKELY TO
INVOLVE COMPLICATED AND DIFFICULT ISSUES, AND THEREFORE IT IRREVOCABLY AND
UNCONDITIONALLY WAIVES ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF
ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS
PURCHASE AGREEMENT, ANY OTHER TRANSACTION DOCUMENT OR THE CONTEMPLATED
TRANSACTIONS.
[Remainder of Page Intentionally Left Blank]
IN WITNESS WHEREOF, the undersigned have duly executed this Membership
Interest Purchase Agreement, or have caused this Membership Interest Purchase
Agreement to be duly executed on their behalf, as of the day and year first
above written.
SELLER:
DTV NETWORK SYSTEMS, INC.
By: /s/ J. XXXXXXX XXXXXX
--------------------------------
Name: J. Xxxxxxx Xxxxxx
--------------------------------
Title: Vice President
--------------------------------
DGTV:
THE DIRECTV GROUP, INC.
By: /s/ J. XXXXXXX XXXXXX
--------------------------------
Name: J. Xxxxxxx Xxxxxx
--------------------------------
Title: Vice President
--------------------------------
PURCHASER:
SKYTERRA HOLDINGS, INC.
By: /s/ XXXXXXX X. XXXXX
--------------------------------
Name: Xxxxxxx X. Xxxxx
--------------------------------
Title: President, Chief Executive Officer
--------------------------------
SKYTERRA:
SKYTERRA COMMUNICATIONS, INC.
By: /s/ XXXXXXX X. XXXXX
--------------------------------
Name: Xxxxxxx X. Xxxxx
--------------------------------
Title: President, Chief Executive Officer
--------------------------------
THE COMPANY:
XXXXXX NETWORK SYSTEMS, LLC
By: /s/ XXXX XXXXXX
--------------------------------
Name: Xxxx Xxxxxx
--------------------------------
Title: Vice President, General Counsel
--------------------------------
Purchase Agreement S-1
ANNEX I
DEFINITIONS
"Affiliate" means, with respect to any Person: (a) with respect to an
individual, any member of such individual's family; (b) with respect to an
entity, any officer, director, stockholder, partner, member or investor of or
in such entity or of or in any affiliate of such entity; and (c) also with
respect to an entity, any Person which directly or indirectly, through one or
more intermediaries, Controls, is Controlled by, or is under common Control
with such Person or entity; provided, that News Corporation and its
Subsidiaries (other than DTVG and its Subsidiaries) shall not be considered
Affiliates of the DTV Group.
"Antitrust Laws" means all United States federal and state, and any
foreign (including those of the European Union), statutes, rules, regulations,
Orders, administrative and judicial doctrines, and other Laws relating to
antitrust or competition matters, including Xxxx-Xxxxx-Xxxxxx, the Xxxxxxx Act,
as amended, the Xxxxxxx Act, as amended, the Federal Trade Commission Act, as
amended, and all other federal, state and foreign (including those of the
European Union) statutes, rules, regulations, Orders, administrative and
judicial doctrines and other Laws that are designed or intended to prohibit,
restrict or regulate actions having the purpose or effect of monopolization or
restraint of trade or lessening of competition through merger or acquisition.
"Class A Unit" has the meaning ascribed to such term in the LLC
Agreement.
"Code" means the Internal Revenue Code of 1986, as amended, and all
Laws promulgated pursuant thereto or in connection therewith.
"Communications Act" means the Communications Act of 1934, as amended.
"Communications Laws" means all United States federal and state, and
any foreign (including those of the European Union), statutes, rules,
regulations, Orders, administrative and judicial doctrines, and other Laws that
are designed or intended to regulate the communications or telecommunications
industry, including the Communications Act, the Telecommunications Act of 1996,
as amended, any rule, regulation or policy of the FCC, and/or any statute,
rule, regulation or policy of any other Governmental Authority with respect to
the operation of channels of radio communication and/or the provision of
communications or telecommunications services.
"Consent" means any (i) approval, authorization, certificate,
concession, consent, declaration, grant, exemption, license, permit, variance,
vote or waiver, (ii) registration or filing or (iii) report or notice,
including all renewals, amendments and extensions of any of the foregoing and
any similar matters.
"Contemplated Transactions" means the transactions contemplated by the
Transaction Documents.
"Contract" means any agreement, contract, note, bond, mortgage,
indenture, consensual obligation, promise, understanding, arrangement,
commitment or undertaking of any nature (whether written or oral and whether
express or implied) which is legally binding, and including any amendment,
modification, side letter, supplement or other agreement or change with respect
to the foregoing, whether written or oral; provided that the foregoing shall
not include Governmental Approvals.
"Contribution Agreement" means that certain Contribution and
Membership Interest Purchase Agreement, dated as of December 3, 2004 (as
amended from time to time), by and among Seller, SkyTerra, the Company and
DTVG.
"Control" (including as used in the terms "controlling," "controlled
by" and "under common control with") means possession, directly or indirectly,
of (i) more than fifty percent (50%) of the securities or other ownership
interests in a Person or the voting power of a Person or (ii) the power to
direct or cause the direction of management or policies (whether through
ownership of voting securities, by agreement or otherwise) of a Person.
"Damages" means all claims, actions or causes of action, assessments,
losses, damages, costs, Taxes, expenses, Liabilities, judgments, awards,
sanctions, penalties, charges and amounts paid in settlement, including
reasonable costs, fees and expenses of attorneys, experts, accountants,
appraisers, consultants, witnesses, investigators and any other agents or
representatives of such Person, but specifically excluding (i) any costs
incurred by or allocated to an indemnified party with respect to time spent by
employees of the indemnified party or any of its Affiliates and (ii) any
exemplary or punitive damages and any special, incidental or consequential
damages, losses or expenses, including lost profits or opportunity costs.
"DIRECWAY Agreement" means that certain Advertising and Marketing
Support Agreement, dated as of April 22, 2005, by and between the Company and
DIRECTV California.
"Distribution" means any payment or other distribution (whether as a
dividend, liquidation payment or otherwise) of cash, equity, notes or other
securities, property or proceeds in respect of the Seller Membership Interests.
"DTV Letters of Credit" means the letters of credit listed on Schedule
I.
"Encumbrances" means any lien, encumbrance, hypothecation, charge,
equity, trust, equitable interest, claim, preference, right of possession,
covenant, interference, proxy, right of first refusal, preemptive right,
community property interest, legend, defect, impediment, exception, limitation,
impairment, imperfection of title or restriction of any nature (including any
restrictions on the voting of any security, any restriction on the transfer of
any security or other asset, any restriction on the receipt of any income
derived from any asset, any restriction on the use of any asset and any
restriction on the possession, exercise or transfer of any other attribute of
ownership of any asset).
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"FCC" means the United States Federal Communications Commission or any
successor agency.
"First Lien Pledge Agreement" means that certain Pledge Agreement,
dated as of April 22, 2005, made by Seller and SkyTerra in favor of JPMorgan
Chase Bank N.A. as administrative agent for the Lenders party to the Credit
Agreement, dated as of April 22, 2005, by and among the Company, the
Administrative Agent, the Lenders, Bear Xxxxxxx Corporate Lending, Inc., as
syndication agent and X.X. Xxxxxx Securities Inc. and Bear Xxxxxxx & Co. Inc.
as joint lead arrangers and joint book managers.
"Governmental Approval" means any: (i) permit, license, certificate,
concession, approval, Consent, ratification, permission, clearance,
confirmation, exemption, waiver, franchise, certification, designation, rating,
registration, variance, qualification, accreditation or authorization issued,
granted, given or otherwise made available by or under the authority of any
Governmental Authority or pursuant to any Law; (ii) right under any Contract
with any Governmental Authority, or (iii) notice required to be given to any
Government Authority.
"Governmental Authority" means any foreign (including applicable
Member States of the European Union), domestic, federal, territorial, state or
local governmental authority, quasi-governmental authority, instrumentality,
court, arbitrator, government or self-regulatory organization, commission,
tribunal or organization or any regulatory, administrative or other agency, or
any political or other subdivision, department or branch of any of the
foregoing.
"Xxxx-Xxxxx-Xxxxxx" means the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements
Act of 1976, as amended, and all Laws promulgated pursuant thereto or in
connection therewith.
"Intellectual Property Agreement" means that certain Intellectual
Property Agreement, dated as of April 22, 2005, by and between DTVG and the
Company.
"Investor Rights Agreement" means that certain Investor Rights
Agreement, dated as of April 22, 2005, by and among Seller, SkyTerra and the
Company.
"Investor Rights Agreement Side Letter" means that certain Letter
Agreement Regarding Acceptable Investment Banks Under Investor Rights
Agreement, dated as of December 3, 2004, by and among Seller, SkyTerra and
DTVG.
"Laws" means all foreign, federal, state and local statutes, laws,
ordinances, regulations, principles of law or equity, rules, governmental and
regulatory policies and practices, resolutions and Orders, applicable to the
specified Persons or to the businesses and assets thereof (including any of the
foregoing relating to (i) securities registration and regulation; (ii) the
sale, leasing, ownership or management of real property; (iii) employment
practices, terms and conditions, and wages and hours; building standards, land
use and zoning; and (iv) safety, health and fire prevention).
"Liability" means any debt, obligation, duty or liability of any
nature (including any unknown, undisclosed, unmatured, unaccrued, unasserted,
contingent, indirect, conditional, implied, vicarious, derivative, joint,
several or secondary liability), regardless of whether such debt, obligation,
duty or liability would be required to be disclosed on a balance sheet prepared
in accordance with generally accepted accounting principles and regardless of
whether such debt, obligation, duty or liability is immediately due and
payable.
"LLC Agreement" means that certain Amended and Restated Limited
Liability Company Agreement of Xxxxxx Network Systems, LLC, dated as of April
22, 2005, by and between Seller and SkyTerra.
"Material Adverse Effect" means, with respect to any Person, any
occurrence, event or omission, as applicable, that would reasonably be expected
to have a material adverse effect on the assets, financial condition or results
of operations of such Person and its Subsidiaries taken as a whole; provided,
however, that the following shall be deemed not to constitute and shall not be
taken into account in determining the occurrence of a Material Adverse Effect:
(i) any effect arising from or relating to general economic, financial or
political conditions or conditions affecting the communications data networks
industry, provided that the effect does not affect such Person in a materially
disproportionate manner compared to similarly situated companies in such
industry; (ii) any effect arising from or relating to any change in Law that
applies to Seller or its Subsidiaries, (iii) any effect arising from a change
in GAAP or interpretations thereof that apply to Seller or its Subsidiaries;
(iv) any effect arising out of any actions specifically required to be taken
pursuant to the terms of this Purchase Agreement in furtherance of the
Contemplated Transactions; or (v) any effect arising out of the announcement of
this Purchase Agreement or the Contemplated Transactions.
"Member" has the meaning ascribed to such term in the LLC Agreement.
"Order" shall mean any: (i) temporary, preliminary or permanent order,
judgment, injunction, edict, decree, ruling, pronouncement, determination,
decision, opinion, verdict, sentence, stipulation, subpoena, writ or award that
is or has been issued, made, entered, rendered or otherwise put into effect by
or under the authority of any court, administrative agency or other
Governmental Authority or any arbitrator or arbitration panel; or (ii) Contract
with any Governmental Authority that is or has been entered into in connection
with any Proceeding.
"Person" means an individual, a corporation, a general partnership, a
limited partnership, a limited liability company, a limited liability
partnership, an association, a trust or any other entity or organization,
including a Governmental Authority.
"Proceeding" shall mean any action, suit, litigation, arbitration,
proceeding (including any civil, criminal, administrative, investigative or
appellate proceeding), prosecution, contest, hearing, inquiry, inquest, audit,
examination or investigation that is or has been commenced, brought, conducted
or heard at law or in equity or before any Governmental Authority or any
arbitrator or arbitration panel.
"Proceeds" means all Distributions and other payments made with
respect to the Seller Membership Interests; all claims available to the Seller
with respect to the Seller Membership Interests; and any and all payments,
property, distributions and fees resulting from any plan, reorganization,
restructuring or liquidation of the Company and any of its Affiliates that
accrue or inure to the benefit of the Seller Membership Interests.
"Purchaser Indemnified Persons" means Purchaser and its respective
Affiliates and Representatives from time to time.
"Representatives" shall mean officers, directors, employees,
attorneys, accountants, advisors, agents, distributors, licensees,
shareholders, subsidiaries and lenders of a party and their Affiliates.
"Second Lien Pledge Agreement" means that certain Pledge Agreement,
dated as of April 22, 2005, made by Seller and SkyTerra in favor of Bear
Xxxxxxx Corporate Lending, Inc., as administrative agent for the Lenders party
to the Second Lien Credit Agreement, dated as of April 22, 2005, by and among
the Company, the Administrative Agent, the Lenders, JPMorgan Chase Bank, N.A.
as syndication agent and X.X. Xxxxxx Securities Inc. and Bear Xxxxxxx & Co.
Inc. as joint lead arrangers and joint book managers.
"Securities Act" shall mean the Securities Act of 1933, as amended.
"Securities Laws" shall mean the Securities Act and the Exchange Act,
and the rules and regulations promulgated thereunder.
"Seller Indemnified Persons" means Seller and its respective
Affiliates and Representatives from time to time.
"Subsidiary" of a specified Person means a Person Controlled by such
Person directly, or indirectly through one or more intermediaries.
"Tax Return" means any return, declaration, report, claim for refund
or information return or statement relating to Taxes, including any schedule or
attachment thereto, and including any amendment thereof, required to be filed
with any Governmental Authority, whether domestic or foreign, including any
consolidated, combined or unitary tax return.
"Taxes" means all federal, state, local and foreign taxes (including
income, profit, franchise, sales, use, real property, personal property, ad
valorem, excise, employment, social security and wage withholding taxes) and
installments of estimated taxes, assessments, deficiencies, levies, imposts,
duties, withholdings, or other similar charges of every kind, character or
description imposed by any Governmental Authority, and any interest, penalties
or additions to tax imposed thereon or in connection therewith.
"Transaction Documents" means this Purchase Agreement, any related
agreements and documents, and any exhibits or attachments to any of the
foregoing, as the same may be amended by this Purchase Agreement or from time
to time.
"Transition Services Agreement" means that certain Transition Services
Agreement, dated as of April 22, 2005, by and between the Company and DTVG.
* * * * *
