FIRST AMENDMENT
DATED AS OF DECEMBER 1, 1997
TO INDENTURE
DATED AS OF JUNE 30,1995
BETWEEN
GEOTEK COMMUNICATIONS, INC.
AND
IBJ XXXXXXXX BANK & TRUST COMPANY, AS TRUSTEE
FIRST AMENDMENT, dated as of December 1, 1997, to INDENTURE, dated as
of June 30, 1995 (the "Indenture"), between GEOTEK COMMUNICATIONS, INC., a
Delaware corporation (the "Company"), and IBJ XXXXXXXX BANK & TRUST COMPANY, a
banking company organized under the laws of the State of New York, as trustee
(the "Trustee").
BACKGROUND:
The parties hereto entered into the Indenture as of June 30, 1995,
which governs the Company's 15% Senior Secured Discount Notes due 2005 (the
"Securities"). The Company and holders of a majority of the outstanding
aggregate principal amount of the Securities have agreed to amend certain
provisions of the Indenture as set forth herein.
Accordingly, the parties hereto agree as follows:
AGREEMENT:
1. Definitions. Capitalized terms used herein and not
otherwise defined shall have the meanings ascribed to such terms in the
Indenture.
2. New Definitions. Section 1.01 of the Indenture is hereby
amended to add the following new definitions in alphabetical order among the
existing definitions:
"Assumed Obligations" has the meaning set forth in
Section 4.12(a).
"Bogen Sale" means the sale by the Company of its
interest in Bogen Communications International, Inc. on
November 26, 1997.
"Bogen Sale Northeast Reinvestment Credit" means the
amount of the Bogen Sale Proceeds that the Company applies to
the purchase of Northeast Replacement Collateral pursuant to
Section 4.20(f).
"Bogen Sale Other Reinvestment Credit" means the
amount of the Bogen Sale Proceeds that the Company applies to
the purchase of Other Replacement Collateral pursuant to
Section 4.20(f).
"Bogen Sale Proceeds" means the Net Cash Proceeds
from the Bogen Sale.
"Bogen Sale Reinvestment Credit" means the sum of
Bogen Sale Northeast Reinvestment Credit and the Bogen Sale
Other Reinvestment Credit.
"Collateral Sale" means any Asset Sale (other than a
Permitted Foreign Asset Sale) involving the sale, conveyance,
transfer, lease or other disposition of any Collateral
(including Replacement Collateral) or any Reallocated License
(other than a Permitted License Transfer).
"Custody Account" means the "Custody Account" as
defined in the Custody Account Pledge Agreement.
"Custody Account Collateral" means the "Collateral"
as defined in the Custody Account Pledge Agreement.
"Custody Account Pledge Agreement" means the Custody
Account Pledge Agreement dated as of December 1, 1997 between
the Company, Geotek USA and the other Subsidiaries of the
Company party thereto and the Trustee, as collateral agent for
the holders of the Securities, as the same may be amended,
modified or supplemented from time to time.
"Exempt Subsidiary" shall have the meaning set forth
in Section 4.18(c).
"GEONET System Security Agreement" means the Security
Agreement dated as of December 1, 1997 between the Company,
Geotek USA and the other Subsidiaries of the Company party
thereto, and the Trustee, as collateral agent for the holders
of the Securities, as the same may be amended, modified or
supplemented from time to time.
"Geotek USA" means Geotek USA, Inc., a Delaware
corporation formerly known as PowerSpectrum, Inc., which is a
Wholly-Owned Subsidiary of the Company.
"License Holding Company" has the meaning set forth
in the U.S. Pledge Agreement.
2
"License Reallocation" has the meaning set forth in
the U.S. Pledge Agreement.
"Northeast Licensed Area" has the meaning set forth
in the U.S. Pledge Agreement.
"Northeast Licenses" has the meaning set forth in
the U.S. Pledge Agreement.
"Northeast Replacement Collateral" means (i)
equipment and fixed assets which are acquired by the Company
or Geotek USA for installation and use in any GEONET system
located within the Northeast Licensed Area and which are
subject to a first priority perfected Lien in favor of the
Trustee under the GEONET System Security Agreement, and (ii)
Licenses for the use of radio channels in the Northeast
Licensed Area which are acquired and held by the License
Holding Company, all of the capital stock of which is subject
to a first priority perfected Lien in favor of the Trustee
under the U.S. Pledge Agreement.
"Other Replacement Collateral" means (i) equipment
and fixed assets which are acquired by the Company or Geotek
USA for installation and use in any GEONET system located
within an area covered by a Reallocated License held by the
License Holding Company (other than a Northeast License or a
Releasable License) and which are subject to a first priority
perfected Lien in favor of the Trustee under the GEONET System
Security Agreement, and (ii) Licenses for the use of radio
channels in areas in the United States other than the
Northeast Licensed Area which are acquired and held by the
License Holding Company, all of the capital stock of which is
subject to a first priority perfected Lien in favor of the
Trustee under the U.S. Pledge Agreement.
"Permitted Asset Sale" means any Asset Sale
(including the Bogen Sale, but excluding any other Collateral
Sale or any Permitted Foreign Asset Sale) occurring after
November 1, 1997, all or a portion of the Net Cash Proceeds of
which constitute Working Capital Proceeds; provided, however,
that such Working Capital Proceeds, when aggregated with the
Working Capital Proceeds of all other Permitted Asset Sales,
shall not exceed (i) $40,000,000 (less the amount of the Bogen
Sale Reinvestment Credit, if any, that is included in the
Working Capital Share of the Net Cash Proceeds from a
Permitted Foreign Asset Sale), minus (ii) the aggregate amount
of Indebtedness incurred by
3
the Company or any of its Subsidiaries pursuant to Section
4.08(n).
"Permitted Foreign Asset Sale" means any Asset Sale
(i) that involves (A) the Capital Stock or assets of National
Band Three Limited or (B) the Capital Stock or other ownership
interest in, or assets of, Geotek Communications GmbH,
Terrafon Bundelfunk GmbH & Co. KG or Terrafon Bundelfunk
Geschaftsfuhrungsgesellschaft mbH, and (ii) all or a portion
of the Net Cash Proceeds of which constitute Working Capital
Proceeds; provided, however, that the Working Capital Proceeds
from any Permitted Foreign Asset Sale shall be subject to the
limitations set forth in Section 10.08(b).
"Permitted License Transfer" has the meaning set
forth in the U.S. Pledge Agreement.
"Reallocated License" has the meaning set forth in
the U.S. Pledge Agreement.
"Releasable License" has the meaning set forth in
the U.S. Pledge Agreement.
"Replacement Collateral" means Northeast Replacement
Collateral and Other Replacement Collateral.
"Security Agreement Collateral" means the
"Collateral" as defined in the GEONET System Security
Agreement.
"Working Capital Proceeds" means the portion of the
Net Cash Proceeds from any Permitted Asset Sale or Permitted
Foreign Asset Sale that are applied or are designated by the
Company to be applied to the working capital needs and general
corporate purposes of the Company or any of its Subsidiaries,
provided that (i) the Working Capital Proceeds from all
Permitted Asset Sales shall not exceed in the aggregate the
limit set forth in the definition of Permitted Asset Sale, and
(ii) the Working Capital Proceeds from any Permitted Foreign
Asset Sale shall not exceed the limit set forth in the
definition of Permitted Foreign Asset Sale.
"Working Capital Share" has the meaning set forth
in Section 10.08(b).
4
3. Amended Definitions.
(a) The definition of "Collateral" contained in
Section 1.01 of the Indenture is hereby amended and restated to read in its
entirety as follows:
"Collateral" means the Pledged Collateral, the
Intercompany Notes, the Custody Account Collateral, the
Security Agreement Collateral and any other collateral to
secure the obligations of the Company hereunder and under the
Securities.
(b) The definition of "Collateral Arrangements"
contained in Section 1.01 of the Indenture is hereby amended and restated to
read in its entirety as follows:
"Collateral Arrangements" means the Pledge
Agreements, the Guarantees, the Note Pledge Agreements, the
Custody Account Pledge Agreement, the Security Agreements and
any other liens, encumbrances, security interests or similar
arrangements created hereby, described or referred to herein
or therein, or otherwise contemplated by the terms hereof or
thereof.
(c) The definition of "Permitted Liens" contained in
Section 1.01 of the Indenture is hereby amended to amend and restate clause (k)
to read in its entirety as follows:
(k) Liens securing Indebtedness, other than
Indebtedness that is subordinated in right of payment to the
Securities, in the aggregate principal amount of up to
$20,000,000 at any time outstanding, provided that such
Indebtedness is permitted to be incurred under the terms of
this Indenture, and provided further that such Liens shall not
cover any Collateral or any Reallocated License (other than a
Releasable License following a Permitted License Transfer
thereof or the Capital Stock of the entity holding a
Releasable License following such a Transfer);
(d) The definition of "Security Agreement" contained
in Section 1.01 of the Indenture is hereby amended and restated to read in its
entirety as follows:
"Security Agreements" means the GEONET System
Security Agreement and any other document pursuant to which a
security interest (other than by way of a pledge) is granted
hereunder, including any security interest in any cash
pursuant to the Pledge Agreements.
5
4. Limitation on Indebtedness.
(a) Section 4.08(n) is hereby renumbered to be
Section 4.08(p) and is amended and restated in its entirety to read as follows:
(p) (i) Indebtedness of the Company the proceeds of
which are used solely to refinance (whether by amendment,
renewal, substitution, replacement, extension or refunding)
Indebtedness (plus reasonable fees and expenses directly
associated with such financing) of the Company or any of its
Subsidiaries and (ii) Indebtedness of any Subsidiary of the
Company the proceeds of which are used solely to refinance
(whether by amendment, renewal, substitution, replacement,
extension or refunding) Indebtedness (plus reasonable fees and
expenses directly associated with such financing) of such
Subsidiary, in each case other than Indebtedness refinanced,
redeemed or retired under clause (j), (k), (m), (n) or (o) of
this Section 4.08; provided, however, that (A) the principal
amount of Indebtedness incurred pursuant to this clause (p)
(or, if such Indebtedness provides for an amount less than the
principal amount thereof to be due and payable upon a
declaration of acceleration of the maturity thereof, the
original issue price of such Indebtedness) shall not exceed
the sum of the principal amount of Indebtedness so refinanced,
plus the amount of any premium required to be paid in
connection with such refinancing pursuant to the terms of such
Indebtedness or the amount of any premium reasonably
determined by the Board of Directors as necessary to
accomplish such refinancing by means of a tender offer or
privately negotiated purchase, plus the amount of expenses in
connection therewith and (B) in the case of Indebtedness
incurred by the Company pursuant to this clause (p) to
refinance Indebtedness subordinated in right of payment to the
Securities, such Indebtedness (I) has an Average Life to
Stated Maturity equal to or greater than the remaining Average
Life to Stated Maturity of the Indebtedness being refinanced
and (II) is subordinated to the Securities in the same manner
and to the same extent that the Indebtedness being refinanced
is subordinated to the Securities.
For purposes of determining compliance with this Section 4.08,
in the event that an item of Indebtedness meets the criteria
of more than one of the types of Indebtedness described in the
above clauses, the Company in its sole discretion,
6
shall classify such item of Indebtedness and only shall be
required to include the amount and type of such Indebtedness
in one of such clauses.
Each reference in the Indenture to Section 4.08(n) is hereby amended to refer to
Section 4.08(p).
(b) Section 4.08 of the Indenture is hereby further
amended to add the following clauses after clause (m) and before clause (p):
(n) unsecured Indebtedness of the Company or any
Subsidiary of the Company, in addition to that described in
clauses (a) through (m) above and clause (o) below, in an
aggregate principal amount outstanding at any time not
exceeding (i) $40,000,000 (less the amount of the Bogen Sale
Reinvestment Credit, if any, that is included in the Working
Capital Share of the Net Cash Proceeds from a Permitted
Foreign Asset Sale), minus (ii) the Working Capital Proceeds
from all Permitted Asset Sales occurring after November 1,
1997;
(o) unsecured Indebtedness of the Company or any
Subsidiary of the Company, in addition to that described in
clauses (a) through (n) above, in an aggregate principal
amount outstanding at any time not exceeding (i) two times the
net cash proceeds received by the Company from the issuance
and sale of Capital Stock (other than Redeemable Capital
Stock) by the Company or any of its Subsidiaries after
November 1, 1997, provided that the aggregate principal amount
of Indebtedness permitted by this clause (i) shall not exceed
$40,000,000, plus (ii) the net cash proceeds received by the
Company from the issuance and sale of Capital Stock (other
than Redeemable Capital Stock) by the Company or any of its
Subsidiaries after November 1, 1997 in excess of the amount of
cash proceeds utilized for purposes of incurring Indebtedness
permitted by clause (i) above, provided that the aggregate
principal amount of Indebtedness permitted by this clause (ii)
shall not exceed $30,000,000; provided, however, that if the
Capital Stock referred to in clause (i) or (ii) above is
issued by a Subsidiary of the Company, then any Indebtedness
based on the issuance of such Capital Stock shall be incurred
only by such Subsidiary and its direct and indirect
subsidiaries and not by the Company or any of its other
Subsidiaries;
7
5. Asset Sales.
(a) Section 4.12(a) of the Indenture is hereby
amended and restated in its entirety to read as follows:
(a) (i) The Company will not, and will not permit any
of its Subsidiaries to, make any Asset Sale (including without
limitation a Permitted Asset Sale) unless (A) the Company or
such Subsidiary, as the case may be, receives consideration at
the time of such Asset Sale at least equal to the Fair Market
Value of the shares or assets sold or otherwise disposed of,
and (B) at least 85% of such consideration consists of cash or
Cash Equivalents or the assumption of Indebtedness of the
Company or such Subsidiary or other obligations relating to
such assets ("Assumed Obligations") and release from all
liability on such Assumed Obligations, unless, in the case of
clause (B), the remainder of such consideration consists of
(x) property or assets that will be owned by the Company or a
Subsidiary of the Company and are to be used in a
telecommunications business or related activities or services
that thereafter will be conducted by the Company or such
Subsidiary or (y) Capital Stock or other securities issued by
a party to the transaction or an Affiliate thereof, which
Capital Stock or other securities are freely tradeable and
which are sold for cash within 90 days of the consummation of
the Asset Sale in connection with which they were acquired,
provided that any such cash (net of any expenses related to
such sale or provisions for taxes payable as a result thereof)
shall constitute Net Cash Proceeds from the Asset Sale for
purposes of this Indenture (including without limitation
Section 10.08).
(ii) The Company or its Subsidiary, as the
case may be, may, within 180 days of an Asset Sale, apply the
Net Cash Proceeds therefrom (or enter into a binding agreement
within such 180-day period to apply such Net Cash Proceeds
within 45 days of the date of such agreement) to (A) an
investment in properties and assets that replace the
properties and assets that were the subject of such Asset Sale
or in properties and assets that will be used in the business
of the Company and its Subsidiaries existing on the Issue Date
or in businesses reasonably related thereto ("Replacement
Assets") or (B) in the case of an Asset Sale by a Subsidiary
of the Company, the repayment of any Indebtedness of such
Subsidiary; provided, however, that so long as no Default or
Event of Default has occurred and is continuing,
8
the Company or such Subsidiary, as the case may be, may apply any
Working Capital Proceeds received from a Permitted Asset Sale to
the working capital needs and general corporate purposes of the
Company or any Subsidiary of the Company. Any Net Cash Proceeds
from any Asset Sale (other than Working Capital Proceeds from a
Permitted Asset Sale) that are not invested in Replacement Assets
(or in the case of an Asset Sale by a Subsidiary of the Company
used to repay Indebtedness of such Subsidiary) within the 180-day
period described above shall constitute "Excess Proceeds" subject
to disposition as provided in Section 4.12(b). Notwithstanding
the foregoing, the application of the Bogen Sale Proceeds shall
be governed by Section 4.20 and the application of the Net Cash
Proceeds of a Permitted Foreign Asset Sale or a Collateral Sale
(other than the Bogen Sale) shall be governed by Section 10.08.
(iii) The Company will not, and will not
permit any of its Subsidiaries to, make any Permitted Asset
Sale, a Permitted Foreign Asset Sale or a Collateral Sale if a
Default or an Event of Default has occurred and is continuing.
6. Subsidiary Guarantees. Sections 4.18(c) and (d) of the
Indenture are hereby amended and restated in their entirety to read as follows:
(c) To the extent that, after the date of this
Indenture, the Company establishes or acquires any additional
wholly owned direct and indirect subsidiaries which are
organized under the laws of a state of the United States or
the District of Columbia and which do business in the United
States, the Company shall promptly, but in no case later than
30 days after the date of such establishment or acquisition,
cause each such subsidiary to jointly and severally guarantee
the obligations of the Company under the Securities, this
Indenture, the Pledge Agreements, the Note Pledge Agreements,
the Security Agreements and any other security arrangements
pursuant to a Guarantee in form and substance satisfactory to
the Trustee, to the fullest extent provided herein and shall
be accompanied by an Opinion of Counsel as to the
enforceability thereof and such other matters as the Trustee
may reasonably request. Notwithstanding the foregoing, no
subsidiary of the Company (other than the Pledged Companies as
defined in the U.S. Pledge Agreement and their direct and
indirect Subsidiaries) shall be required to guarantee any of
the above-referenced
9
obligations if the only material assets of such subsidiary
consist of Licenses and rights related thereto (including
rights under license agreements with respect to such Licenses)
and if all of the Capital Stock of such subsidiary is pledged
to secure Indebtedness (other than Indebtedness in respect of
the Securities) permitted to be incurred by the Company or one
of its Subsidiaries hereunder (an "Exempt Subsidiary").
(d) To the extent that any wholly-owned subsidiary of
the Company that is organized under the laws of a state of the
United States or the District of Columbia (other than Cumulous
if it is not a Guarantor and other than an Exempt Subsidiary)
is not required to execute and deliver a Guarantee as
contemplated above, the Company hereby covenants that such
subsidiary shall not engage in any business activities in the
United States or hold any License. To the extent any such
subsidiary engages in such business activities or holds any
License at such time, the Company shall cause such business
activities to be ceased promptly and/or such Licenses to be
transferred (and the Company will use its best efforts to
cause any Licenses to be so transferred), as soon as
practicable to a Guarantor.
7. Bogen Sale Proceeds; Restrictions Pending License
Reallocation; Quarterly Compliance Certificate. Article Four of the Indenture is
hereby further amended to add the following sections after Section 4.19:
4.20 Application of Bogen Sale Proceeds.
(a) Upon the First Amendment to this Indenture
becoming effective, and so long as no Default or Event of
Default has occurred and is continuing, the Company may use up
to $5,000,000 of the Bogen Sale Proceeds for the working
capital needs and general corporate purposes of the Company
and its Subsidiaries. The balance of the Bogen Sale Proceeds
shall be deposited in the Custody Account and shall be applied
as provided in this Section 4.20.
(b) Upon delivery to the Trustee of an Officers'
Certificate that (i) the License Reallocation has been
approved by an order of the FCC (the finality of which is
subject to the expiration of a 45-day period for objections or
appeals), (ii) Xxxxxx Network Systems, Inc. has consented to
the License Reallocation, and (iii) no person has objected to
the License Reallocation
10
or attempted to intervene in the FCC proceedings relating to
the License Reallocation, the Company may withdraw from the
Custody Account up to an additional $5,000,000 of the Bogen
Sale Proceeds for the working capital needs and general
corporate purposes of the Company and its Subsidiaries.
(c) On or after the later of (i) February 1, 1998,
and (ii) the delivery of the Officers' Certificate referred to
in Section 4.20(b), the Company may withdraw from the Custody
Account up to an additional $4,000,000 of the Bogen Sale
Proceeds for the working capital needs and general corporate
purposes of the Company and its Subsidiaries.
(d) On or after the expiration of 45 days from the
date of the FCC's order approving the License Reallocation and
the delivery to the Trustee of the Officers' Certificate and
opinion of counsel referred to in Section 4.1.11 of the U.S.
Pledge Agreement, the Company may withdraw the balance of the
Bogen Sale Proceeds from the Custody Account for the working
capital needs and general corporate purposes of the Company
and its Subsidiaries.
(e) No Bogen Sale Proceeds shall be withdrawn from
the Custody Account for the working capital needs and general
corporate purposes of the Company and its Subsidiaries if a
Default or Event of Default has occurred and is continuing,
and the Company shall deliver to the Trustee an Officers'
Certificate to such effect at the time of any such withdrawal.
Any Bogen Sale Proceeds which are applied to the working
capital needs and general corporate purposes of the Company
and its Subsidiaries shall constitute Working Capital Proceeds
from a Permitted Asset Sale occurring after November 1, 1997.
(f) The Company may at any time apply all or any part
of the Bogen Sale Proceeds remaining in the Custody Account to
purchase Replacement Collateral or to pay outstanding invoices
for previously purchased Replacement Collateral, provided that
not less than 33 % of the Bogen Sale Proceeds so applied shall
be used to purchase Northeast Replacement Collateral or to pay
outstanding invoices for previously purchased Northeast
Replacement Collateral. The Company may withdraw the Bogen
Sale Proceeds from the Custody Account for the purchase of (or
payment of outstanding invoices for) Replacement Collateral
11
upon delivery to the Trustee of (i) an Officers' Certificate
certifying (A) the type of Replacement Collateral to be
purchased (or paid for), the locations where such Collateral
will be (or has been) installed or used, and the fact that
such Replacement Collateral will meet the requirements of the
Indenture relating to Replacement Collateral, and (B) that no
Default or Event of Default has occurred and is continuing,
and (ii) an opinion of independent counsel that such
Replacement Collateral will be subject to a first priority
perfected Lien in favor of the Trustee under the GEONET System
Security Agreement or will be Licenses held by the License
Holding Company, all of the capital stock of which is subject
to a first priority perfected Lien in favor of the Trustee
under the U.S. Pledge Agreement; provided, however, that no
such opinion shall be required with respect to (A) Northeast
Replacement Collateral which will be installed in
jurisdictions (both state and local) containing Collateral
with respect to which an opinion of independent counsel was
previously furnished to the Trustee (provided that in such
case the next annual Opinion of Counsel furnished to the
Trustee under Section 10.02(c) shall expressly cover such
newly installed Northeast Replacement Collateral), or (B)
Other Replacement Collateral if the cost thereof, when added
to the cost of all other Other Replacement Collateral being
installed in the same state, does not exceed $1,000,000,
except that if Other Replacement Collateral will be installed
in a state with respect to which no opinion of independent
counsel has been previously furnished to the Trustee, such
opinion of independent counsel shall nevertheless be required
if the cost of such Other Replacement Collateral, when added
to the cost of all other Other Replacement Collateral being
installed or previously installed in such state, will exceed
$1,000,000; and further provided, that upon the First
Amendment to this Indenture becoming effective, the Company
may make an initial withdrawal of Bogen Sale Proceeds of up to
$2,750,000 for the purchase of (or payment of outstanding
invoices for) Other Replacement Collateral without delivering
such opinion of independent counsel provided that such opinion
is delivered to the Trustee within thirty (30) days
thereafter. Nothing contained in this Section 4.20 shall amend
or modify the obligation of the Company to furnish to the
Trustee the annual Opinion of Counsel required under Section
10.02(c).
12
(g) Any Bogen Sale Proceeds that are not withdrawn
for working capital needs and general corporate purposes or
invested in Replacement Collateral as required by this Section
4.20 within 18 months of the Bogen Sale shall constitute
"Excess Proceeds" subject to disposition as provided in
Section 4.12(b) (but without regard to the $10,000,000
threshold set forth therein).
4.21 Restrictions Pending License Reallocation.
Unless and until the Company has completed the
License Reallocation and the Trustee has received the
Officers' Certificate and opinion of counsel referred to in
Section 4.1.11 of the U.S. Pledge Agreement, the Company will
not, and will not permit any of its Subsidiaries to, (i) use
any Net Cash Proceeds from a Permitted Asset Sale or a
Permitted Foreign Asset Sale for the working capital needs and
general corporate purposes of the Company or any of its
Subsidiaries, except as permitted by Section 4.20, (ii) incur
or permit to exist any Indebtedness under Section 4.08(n) or
4.08(o) of the Indenture, or (iii) grant or permit to exist
any Lien under clause (k) of the definition of Permitted Liens
which, together with all other Liens granted or permitted to
exist under such clause, in the aggregate secure more than
$10,000,000 of Indebtedness.
4.22 Quarterly Compliance Certificate Regarding Custody
Account
The Company will deliver to the Trustee, within 15
days after the end of each fiscal quarter, a statement setting
forth the following information as of the end of such fiscal
quarter, in each case for the Custody Account as a whole and
for the amounts in the Custody Account derived from the Bogen
Sale, Permitted Foreign Asset Sales and Collateral Sales: (i)
the amount in the Custody Account, (ii) any additional Net
Cash Proceeds deposited in the Custody Account since the end
of the prior fiscal quarter, indicating the source of such Net
Cash Proceeds, (iii) any funds withdrawn from the Custody
Account and the use to which such funds were applied, (iv) the
total amounts withdrawn from the Custody Account to date for
working capital needs and general corporate purposes, (v) the
total amounts withdrawn from the Custody Account to date for
investment in Northeast Replacement Collateral and Other
Reinvestment Collateral, (vi) the total amounts withdrawn from
the Custody Account to date for use as Excess Proceeds, (vii)
the total amount
13
of Working Capital Proceeds generated to date by all other
Permitted Asset Sales (the Net Cash Proceeds of which were not
deposited in the Custody Account), and (viii) the total amount
of Working Capital Proceeds generated to date by Indebtedness
incurred under Section 4.08(n).
8. Events of Default. Section 6.01 of the Indenture is hereby
amended to amend and restate clause (c) in its entirety to read as follows:
(c) a failure to perform or observe any other term,
covenant or agreement contained in the Securities, this
Indenture, the Custody Account Pledge Agreement or any of the
Pledge Agreements or Security Agreements (other than a default
specified in clause (a) or (b) above), which failure continues
for a period of 30 days after written notice thereof requiring
the Company to remedy the same shall have been given (i) to
the Company by the Trustee or (ii) to the Company and the
Trustee by Holders of at least 25% aggregate principal amount
of the Securities then outstanding; or
9. Release of Collateral. Section 10.03(a) of the Indenture is
hereby amended to amend and restate the proviso in the second sentence of such
Section as follows:
provided, that if such sale, conveyance or disposition
constitutes an Asset Sale, the Company shall apply the Net
Cash Proceeds in accordance with Sections 4.12 (Asset Sales
generally), 4.20 (the Bogen Sale) and 10.08 (Permitted Foreign
Asset Sales and Collateral Sales) and any such agreements, to
the extent applicable.
10. Permitted Foreign Asset Sales; Collateral Sales. Section
10.08 of the Indenture is hereby amended and restated in its entirety to read as
follows:
(a) The Company will not, and will not permit any of
its Subsidiaries to, make any Permitted Foreign Asset Sale or
any Collateral Sale unless the requirements of Section
4.12(a)(i) and (iii) and this Section 10.08 are satisfied.
(b) The Company or its Subsidiary, as the case may
be, shall apply the Net Cash Proceeds from a Permitted Foreign
Asset Sale as follows: (i) not less than 20% of such Net Cash
Proceeds shall constitute "Excess Proceeds" (the "Excess
Proceeds Share"), which the Company shall use within 30 days
after such Sale to make an Asset Sale Offer in accordance with
Section 4.12(b) (but
14
without regard to the $10,000,000 threshold set forth
therein); (ii) within 18 months after such Sale, the Company
or such Subsidiary shall apply not less than 40% of such Net
Cash Proceeds (less the amount of any Bogen Sale Reinvestment
Credit) (the "Reinvestment Share") to purchase Northeast
Replacement Collateral, provided that the Company may use up
to $10,000,000 of the Reinvestment Share (less the amount of
any Bogen Sale Other Reinvestment Credit) for investment in
Other Replacement Collateral; and (iii) so long as no Default
or Event of Default has occurred and is continuing, the
Company or such Subsidiary may apply up to 40% of such Net
Cash Proceeds (plus the amount of any Bogen Sale Reinvestment
Credit) (the "Working Capital Share") to the working capital
needs and general corporate purposes of the Company and its
Subsidiaries; provided, however, that if the consideration for
a Permitted Foreign Asset Sale does not consist entirely of
cash and Cash Equivalents or the assumption of Assumed
Obligations, then (x) the Working Capital Share shall be
reduced (on a dollar-for-dollar basis, but not less than zero)
by the amount of the consideration which is not cash or Cash
Equivalents or Assumed Obligations, (y) the Excess Proceeds
Share shall be increased by one-third of the amount of such
reduction and the Reinvestment Share shall be increased by
two-thirds of the amount of such reduction, and (z) the amount
of the Reinvestment Share that would otherwise be available
for investment in Other Replacement Collateral under the
foregoing allocation shall be reduced by the percentage that
the noncash consideration bears to the total consideration for
such Sale. If within 18 months after a Permitted Foreign Asset
Sale, the Company has not invested the Reinvestment Share in
Replacement Collateral, the uninvested amount of the
Reinvestment Share shall constitute Excess Proceeds and shall
be used to make an Asset Sale Offer in accordance with Section
4.12(b) (but without regard to the $10,000,000 threshold set
forth therein). The Company shall cause any noncash proceeds
(including securities) from a Permitted Foreign Asset Sale to
immediately become subject to a first priority perfected Lien
in favor of the Trustee. If such noncash proceeds are
subsequently sold for cash, the Company may, so long as no
Default or Event of Default has occurred and is continuing,
apply the Net Cash Proceeds from such sale to the working
capital needs and general corporate purposes of the Company
and its Subsidiaries; provided, however, that the amount of
such Net Cash Proceeds that are
15
applied to working capital needs and general corporate
purposes, when taken together with all other Net Cash Proceeds
from the Permitted Foreign Asset Sale that are so applied,
shall not exceed the Working Capital Share that would have
resulted if all of the consideration from such Asset Sale had
been cash.
(c) The Company or its Subsidiary, as the case may
be, shall apply the Net Cash Proceeds from a Collateral Sale
(other than the Bogen Sale) to the purchase of Replacement
Collateral; provided, however, that if the Collateral Sale
involves any Collateral which is part of or used in connection
with any GEONET system located in the Northeast Licensed Area,
the Net Cash Proceeds therefrom shall be applied solely to the
purchase of Northeast Replacement Collateral; and provided
further, that if the Collateral Sale involves the sale of a
Northeast License as permitted by Section 10.08(e)(ii)(B), the
cash proceeds therefrom shall be applied solely to the
purchase of Licenses that will constitute Northeast
Replacement Collateral. Any Net Cash Proceeds from a
Collateral Sale that are not invested in Replacement
Collateral as required by this Section 10.08(c) within 18
months of such Sale shall constitute "Excess Proceeds" subject
to disposition as provided in Section 4.12(b) (but without
regard to the $10,000,000 threshold set forth therein). Except
for the use of the Bogen Sale Proceeds as permitted by Section
4.20, the Net Cash Proceeds from a Collateral Sale shall not
be used for the working capital needs and general corporate
purposes of the Company and its Subsidiaries. The Company
shall cause any noncash proceeds (including securities) from a
Collateral Sale to immediately become subject to a first
priority perfected Lien in favor of the Trustee.
Notwithstanding the foregoing, in the event of a sale of
Collateral which is subject to a Release Condition Senior Lien
(as defined in the U.S. Pledge Agreement), the application of
the proceeds of such sale pursuant to this Section 10.08(c)
shall be subject to the prior application of such proceeds to
any Indebtedness secured by such Release Condition Senior
Lien.
(d) Subject to the provisions of Section 10.08(e),
any Liens in favor of the Trustee on the assets (including
stock) sold in a Permitted Foreign Asset Sale or a Collateral
Sale will be released upon (i) the deposit of the Net Cash
Proceeds from such Sale in the Custody Account subject to a
first priority perfected Lien in
16
favor of the Trustee, and (ii) the delivery to the Trustee of
an Officers' Certificate and opinion of independent counsel
that any noncash proceeds from such Sale are subject to a
first priority perfected Lien in favor of the Trustee. The Net
Cash Proceeds shall continue to be held in the Custody Account
until such Proceeds have been applied in the manner set forth
in Section 10.08(b) (in the case of a Permitted Foreign Asset
Sale) or Section 10.08(c) (in the case of a Collateral Sale).
So long as no Default or Event of Default has occurred and is
continuing, the Company may withdraw such Net Cash Proceeds
from the Custody Account upon its delivery to the Trustee and
the custodian of (A) an Officers' Certificate certifying (1)
the purpose for which the withdrawn funds will be used, (2)
the amount of the requested withdrawal, (3) in the case of
withdrawals for working capital needs and general corporate
purposes, the total amount of Working Capital Proceeds
previously withdrawn from the Custody Account and the amount
of available Working Capital Proceeds remaining in the Custody
Account (prior to the requested withdrawal), (4) in the case
of withdrawals for investment in Replacement Collateral, the
type of Collateral to be purchased, the locations where such
Collateral will be installed or used, and the fact that such
Replacement Collateral will meet the requirements of the
Indenture relating to Replacement Collateral, and (5) that no
Default or Event of Default has occurred and is continuing,
and (B) in the case of withdrawals for investment in
Replacement Collateral, an opinion of independent counsel that
such Replacement Collateral will be subject to a first
priority perfected Lien in favor of the Trustee under the
GEONET System Security Agreement or will be Licenses held by
the License Holding Company, all of the capital stock of which
is subject to a first priority perfected Lien in favor of the
Trustee under the U.S. Pledge Agreement; provided, however,
that no such opinion shall be required with respect to (A)
Northeast Replacement Collateral which will be installed in
jurisdictions (both state and local) containing Collateral
with respect to which an opinion of independent counsel was
previously furnished to the Trustee (provided that in such
case the next annual Opinion of Counsel furnished to the
Trustee under Section 10.02(c) shall expressly cover such
newly installed Northeast Replacement Collateral), or (B)
Other Replacement Collateral if the cost thereof, when added
to the cost of all other Other Replacement Collateral being
installed in the same state, does not exceed $1,000,000,
except that if
17
Other Replacement Collateral will be installed in a state with
respect to which no opinion of independent counsel has been
previously furnished to the Trustee, such opinion of
independent counsel shall nevertheless be required if the cost
of such Other Replacement Collateral, when added to the cost
of all other Other Replacement Collateral being installed or
previously installed in such state, will exceed $1,000,000.
Nothing contained in this Section 10.08(d) shall amend or
modify the obligation of the Company to furnish to the Trustee
the annual Opinion of Counsel required under Section 10.02(c).
The funds in the Custody Account shall not be released except
pursuant to the withdrawal procedure set forth above (or in
Section 4.20) or until the obligations of the Company under
this Indenture and the Securities have been discharged.
(e) Notwithstanding any provision to the contrary
contained in this Indenture, the Securities, the Collateral
Arrangements or any other document, the Company will not, and
will not permit any of its Subsidiaries to, directly or
indirectly -
(i) sell, convey, transfer, lease or
otherwise dispose of any Collateral which constitutes part of
or is used in connection with any GEONET system located within
the Northeast Licensed Area, except (A) transactions in the
normal and ordinary course of business for value received, (B)
the disposition of obsolete assets, (C) the sale, trade-in or
other disposition of such Collateral in connection with
upgrades, enhancements or other modifications to such GEONET
systems, and (D) the sale, conveyance, transfer, lease or
other disposition of Collateral which is subject to a Release
Condition Senior Lien (as defined in the U.S. Pledge
Agreement); provided, however, that the proceeds of any sale,
conveyance, transfer, lease or other disposition of Collateral
pursuant to the exceptions in clauses (B), (C) and (D) above
shall be deposited in the Custody Account subject to Section
10.08(c) and (d); or
(ii) sell, convey, transfer, lease or
otherwise dispose of, or grant any rights or interest in, any
Northeast License, except (A) the transfer of a Releasable
License pursuant to a Permitted License Transfer thereof or
any sale, conveyance, transfer, lease or otherwise disposition
of, or grant of any rights or interest in, such Releasable
Licenses following a Permitted
18
License Transfer thereof, and (B) the sale of a Northeast
License to a purchaser who is not an Affiliate of the Company
for consideration (which shall be not less than the Fair
Market Value of such Northeast License) consisting entirely of
cash and/or Licenses that will constitute Northeast
Replacement Collateral; provided, however, that the cash
proceeds of any sale of a Northeast License pursuant to the
exception in clause (B) above shall be deposited in the
Custody Account and shall be subject to Section 10.08(c) and
(d).
(f) The Company shall not withdraw any funds from the
Custody Account for the working capital needs and general
corporate purposes of the Company or any of its Subsidiaries
(except for withdrawals of the Bogen Sale Proceeds permitted
by Section 4.20) unless and until the expiration of 45 days
from the date of the FCC's order approving the License
Reallocation and the Trustee has received the Officers'
Certificate and opinion of counsel referred to in Section
4.1.11 of the U.S. Pledge Agreement. Thereafter, the Company's
withdrawals from the Custody Account for working capital needs
and general corporate purposes shall not exceed $12,000,000 in
any one month or $30,000,000 in any period of three
consecutive months.
11. Conditions Precedent. The amendment of the Indenture
pursuant to this First Amendment shall not be effective unless and until each of
the following conditions precedent have been satisfied:
(a) The Company shall have delivered the following
documents to the Trustee, in form satisfactory to the Trustee:
(i) This First Amendment, duly executed by
the Company;
(ii) The First Amendment to the U.S. Pledge
Agreement, duly executed by the Company, together with the stock certificates,
stock powers and any other documents required to be delivered by the Company
thereunder;
(iii) The GEONET System Security Agreement,
which shall be substantially in the form of Exhibit A hereto, duly
executed by the Company, Geotek USA and Geotek America, Inc. ("Geotek America"),
together with the UCC-1 financing statements and any other documents required to
be delivered by the Company, Geotek USA and Geotek America thereunder;
(iv) The Custody Account Pledge Agreement,
which shall be substantially in the form of Exhibit B hereto, duly
19
executed by the Company and Geotek USA, together with an acknowledgment and
agreement of the custodian, in form and substance satisfactory to the Trustee,
and any other documents required to be delivered by the Company and Geotek USA
thereunder;
(v) A certified copy of resolutions of the
board of directors of the Company, Geotek USA and Geotek America authorizing
the execution, delivery and performance of this First Amendment, the First
Amendment to the Pledge Agreement, the GEONET System Security Agreement, the
Custody Account Pledge Agreement and any other documents required to be
delivered by the Company, Geotek USA and Geotek America hereunder or thereunder
(collectively, the "Amendment Documents");
(vi) A certificate of the corporate
secretary of the Company, Geotek USA, Geotek America and the License Holding
Company as to their charter documents and bylaws and (in the case of the
Company, Geotek USA and Geotek America) the incumbency and signatures of their
officers;
(vii) Certificates from the Secretaries of
State (or comparable officials) of Delaware, Maryland, Massachusetts, New
Jersey, New York, Pennsylvania, Virginia and the District of Columbia as to the
good standing of Geotek USA (in all such jurisdictions) and the Company, Geotek
America and the License Holding Company (in Delaware only); and
(viii) An opinion of independent counsel
to the Company with respect to such matters as may be requested by the Trustee
or by the Holder or Holders of at least 25% aggregate principal amount of the
Securities then outstanding, including without limitation the receipt of all
consents and taking of all actions required under, and the compliance with, the
Indenture and the TIA, the enforceability of the Amendment Documents, the
perfection and priority of the security interests granted to the Trustee under
the GEONET System Security Agreement and the Custody Account Pledge Agreement,
and related intellectual property and licensing issues.
(b) There shall not exist any Default or Event of
Default (as defined in the Indenture, as amended hereby).
(c) The Company shall have reimbursed the Trustee for
all fees and expenses (including reasonable legal fees) incurred by it in
connection with the Amendment Documents and the transactions contemplated
thereby.
12. Counterparts. This First Amendment may be signed in any
number of counterpart copies, each of which shall constitute an original, with
the same effect as if the signatures thereon and hereon were upon the same
instrument.
13. Governing Law. This First Amendment shall be construed, interpreted
and governed by the laws of the State of
20
New York, without giving effect to the principles of conflicts of law.
14. No Other Amendments. Except as to the matters referred to
in this First Amendment, the Indenture shall remain in full force and effect in
accordance with its terms.
[SIGNATURE PAGES IMMEDIATELY FOLLOW]
IN WITNESS WHEREOF, the Company and the Trustee have executed this
First Amendment as of the day first written above.
GEOTEK COMMUNICATIONS, INC.
By:
------------------------------
Name:
Title:
IBJ XXXXXXXX BANK & TRUST COMPANY,
as trustee
By: /s/ Xxxxxxx X. Xxxxxxxxx
------------------------------
Name: Xxxxxxx X. Xxxxxxxxx
Title: Assistant Vice President
/u1n/woodrf/ml.geotek.amendind.1226 21449/62674
20
