AMENDMENT NO. 1
TO GUARANTY ISSUANCE AGREEMENT
AMENDMENT, dated as of March 27, 1997, to the Guaranty Issuance
Agreement, dated as of June 28, 1996, by and among Xxxxxx Electronics
Corporation, Singapore Telecommunications Ltd., Baron Capital Partners, L.P.,
AMSC Subsidiary Corporation and American Mobile Satellite Corporation (the
"Agreement").
W I T N E S S E T H:
WHEREAS, the parties hereto desire to effect certain changes to the
Agreement herein contained;
NOW, THEREFORE, the undersigned parties hereto agree as follows:
SECTION 1. Definitions. Unless otherwise indicated, capitalized terms
used herein shall have the meanings set forth in the Agreement.
SECTION 2. Consideration for the Issuance of the Guaranties. As
consideration for the execution of this Amendment No. 1 by the Guarantors, the
Warrants issued to each of the Guarantors in connection with the Guarantees are
hereby amended to reflect an increase in the aggregate number of Warrant Shares
to 5,500,000 and a change in the exercise price to $13.00. To implement the
foregoing, an amendment to each of such Warrants, in the form annexed hereto,
has been executed concurrently with the execution hereof.
SECTION 3. Change to the Performance Schedule. The Performance Schedule
annexed to the Agreement as Exhibit D is hereby amended in its entirety and
replaced with the Performance Schedule annexed hereto.
SECTION 4. Section 3 of the Agreement is hereby amended in its entirety
and replaced with the following:
Limitations on Amount of Guaranties. AMSC and AMSC Parent have delivered to
Guarantors AMSC's 1997 Budget, including its projected borrowing needs (the
"Plan"), which has formed the basis for the agreement of the Guarantors to enter
into this Amendment No. 1. As consideration for the execution of this Amendment
No. 1 by the Guarantors, AMSC agrees that the outstanding principal amount of
the loans which are guaranteed (such outstanding amount and any payments made by
Guarantors with respect to principal under the Credit Agreement, the "Guaranteed
Amount") shall not, at any time, exceed the then applicable borrowing limit (the
"Borrowing Limit") specified on the Performance Schedule attached hereto as
Exhibit D (the "Performance Schedule").
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AMSC and AMSC Parent agree that the aggregate outstanding principal
amount of the loans under the Credit Agreements plus any amounts paid by the
Guarantors with respect to principal shall not exceed the Guaranteed Amount. The
Guarantors having Pro Rata Shares greater than 50% ("Requisite Guarantors") may,
by written notice delivered to AMSC, waive compliance with the then applicable
Borrowing Limit and consent to borrowings by AMSC which would increase the
Guaranteed Amount up to the "Borrowing Limit" specified by such waiver. A waiver
granted hereunder shall not obligate the Guarantors to grant a waiver for any
subsequent period or consent to any additional increase in the applicable
Borrowing Limit.
If any borrowing causes or would cause the Guaranteed Amount to exceed
the then applicable Borrowing Limit, then Requisite Guarantors may, by a written
notice delivered to AMSC (a "Guarantor's Notice"), decline to increase the
Guaranteed Amount to cover any increased borrowings. Under the terms of the
Guaranties, Guarantors will be required to purchase the outstanding notes upon
the occurrence of a "Guarantor Event" under the Credit Agreements, and the
commitments to extend further financing under the Credit Agreements will
terminate.
Under the terms of the Credit Agreements, at the time of each
borrowing, AMSC will be required to certify that it is in compliance with the
provisions of this Agreement. AMSC or AMSC Parent can so certify if the
outstanding amount of the loans after such borrowing will be less than the then
applicable Borrowing Limit or if, and to the extent that, Requisite Guarantors
shall have modified such Borrowing Limit. At the request of AMSC and AMSC
Parent, any Borrowing Limit may be modified with the written consent of
Requisite Guarantors. If Requisite Guarantors propose to increase the applicable
Borrowing Limit for any period to an amount in excess of that set forth on the
Performance Schedule, such proposal shall be discussed with the other Guarantors
prior to granting such consent.
Any action by Requisite Guarantors in accordance with this Section 3
shall bind all Guarantors. Any notice delivered under this Section shall be
delivered to all Guarantors, but failure of all Guarantors to receive such
notice shall not affect the validity of such notice.
Nothing in this Section shall limit the enforceability by the
"Guaranteed Parties" of any Guaranty in accordance with its terms.
Within 45 days after the end of each fiscal quarter, AMSC Parent shall
deliver to each Guarantor the unaudited consolidated and consolidating balance
sheets of AMSC and AMSC Parent as of the end of such quarter and the related
consolidated and consolidating statements of income, stockholders' equity and
cash flows, and certified by the chief financial officer as fairly presenting,
in all material respects, in accordance with generally accepted accounting
principles (except for the absence of footnote disclosure), the financial
position and the results of operations of AMSC and AMSC Parent.
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SECTION 5. Miscellaneous.
(a) AMSC and AMSC Parent hereby represent to the Guarantors
that, as of the date hereof, and after giving effect to this
Amendment No. 1 and the transactions contemplated hereby, no
Default (as such term in defined in the Credit Agreements)
has occurred and is continuing.
(b) AMSC hereby reaffirms that the Registration Rights Agreement
is in full force and effect and that all of the shares of
common stock of AMSC Parent issuable upon exercise of the
Warrants, as such number of shares has been increased as
described in this Amendment No. 1, constitute Registrable
Securities (as such term is defined in the Registration
Rights Agreement).
(c) AMSC and AMSC Parent hereby represent to the Guarantors that
each representation and warranty set forth in Section 11 of
the Agreement is true and correct as of the date hereof,
except that (i) each reference therein to "this Agreement"
shall be deemed to be a reference to this Amendment No. 1,
(ii) all references to the Warrants, the Registration Rights
Agreement and the Common Stock shall give effect to the
transactions contemplated hereby, and (iii) the reference in
Section 11(e) of the Agreement to December 31, 1995 instead
shall be to December 31, 1996.
(d) Except as expressly amended hereby, the terms of the
Agreement remain unchanged and the Agreement, as amended
hereby, continues in full force and effect.
(e) Concurrently with the execution hereof, each Guarantor shall
receive the written opinion of counsel to AMSC and AMSC
Parent as to the due authorization, execution and
enforceability of this Amendment No. 1 and Amendment No. 1
to the Warrant Certificates, in form and substance
satisfactory to each Guarantor; and
(f) AMSC Parent hereby advises each of the Guarantors that
the Board of Directors of AMSC Parent has received an
opinion from Xxxxxxxxx, Xxxxxx & Xxxxxxxx Securities
Corporation to the effect that the transactions contemplated
hereby, including the increase in the number of shares
covered by the Warrants and the reduction of the exercise
price of the Warrants, are fair to AMSC and AMSC Parent from
a financial point of view.
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SECTION 6. Governing Law. This Amendment shall be governed by and
construed in accordance with the laws of the State of New York.
SECTION 7. Counterparts. This Amendment may be signed in any number of
counterparts, each of which shall be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument.
SECTION 8. Effectiveness. This Amendment shall become effective when
AMSC has received signature pages hereof signed by the Requisite Guarantors or
facsimile or other written confirmation that such parties have signed a
counterpart hereof.
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IN WITNESS WHEREOF, each of the parties hereto has caused this
Amendment No. 1 to the Agreement to be executed by its duly authorized officer.
AMSC SUBSIDIARY CORPORATION SINGAPORE TELECOMMUNICATIONS
LTD.
By: /s/XXXXXXX X. XXXXXXXXXX By: /s/HO SIAW HONG
--------------------------- ---------------------------
Name: Xxxxxxx X. Xxxxxxxxxx Name: Ho Siaw Hong
Title: VP & Treasurer Title: Senior Director
AMERICAN MOBILE SATELLITE BARON CAPITAL PARTNERS, L.P.,
CORPORATION a Delaware limited partnership
By: /s/XXXXXXX X. XXXXXXXXXX By: Baron Capital Management,
--------------------------- Inc., a General Partner
Name: Xxxxxxx X. Xxxxxxxxxx
Title: VP & Treasurer By: /s/XXXXX XXXXXX
---------------------------
XXXXXX ELECTRONICS CORPORATION Name: Xxxxx Xxxxxx
Title: V.P.
By: /s/XXXXX XXXX
---------------------------
Name: Xxxxx Xxxx
Title: Assistant Treasurer
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EXHIBIT D
TO
GUARANTEE ISSUANCE AGREEMENT
(As Amended by Amendment No. 1 thereto)
Performance Schedule
($000's)
01/01/97 04/01/97 07/01/97 10/01/97
to to to to
03/31/97 06/30/97 09/30/97 12/31/97
-------- -------- -------- --------
Borrowing Limit $170,000 $180,000 $190,000 $200,000
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AMENDMENT NO. 1
TO WARRANT CERTIFICATES FOR THE PURCHASE OF SHARES OF
COMMON STOCK OF AMERICAN MOBILE SATELLITE CORPORATION
AMENDMENT, dated as of March 27, 1997, to each of those Warrant
Certificates dated as of June 28, 1996 (the "Warrants" and capitalized terms
used herein and not otherwise defined shall have the meanings ascribed thereto
in the Warrants), issued by American Mobile Satellite Corporation (the
"Company") to each of Xxxxxx Electronics Corporation, Singapore
Telecommunications Ltd. and Baron
Capital Partners, L.P. (collectively, the "Holders").
W I T N E S S E T H:
WHEREAS, the Company previously issued to the Holders Warrants that
represented in the aggregate the right to purchase 5,000,000 shares of Common
Stock at an Exercise Price of $24.00 per share;
WHEREAS, the Company, the Holders and AMSC are entering into on the
date hereof Amendment No. 1 ("Amendment No. 1") to the Guaranty Issuance
Agreement;
WHEREAS, as contemplated by Amendment No.1, the parties hereto desire
to amend certain terms of the Warrants.
NOW, THEREFORE, the undersigned parties hereto agree as follows:
SECTION 1. Amendments.
a. Section 1 of each of the Warrants is hereby amended by modifying the
definition of "Exercise Price" to read in its entirety as follows: "Exercise
Price" means initially $13.00 per Warrant Share, as adjusted from time to time.
b. The Warrant Share Amount reflected in the preamble to each of the
Warrants shall be modified as follows:
Holder Warrant Share Amount
------ --------------------
Xxxxxx Electronics Corporation 4,125,000
Singapore Telecommunications Ltd. 687,500
Baron Capital Partners, L.P. 687,500
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c. Section 15 of the Warrants is hereby deleted in its entirety.
SECTION 2. Reaffirmance. Except as expressly amended hereby, the terms
of the Warrants remain unchanged and the Warrants, as amended hereby, are in
full force and effect.
SECTION 3. Issuance of Replacement Warrant. Upon the request of any
Holder, the Company promptly shall issue a new Warrant, incorporating the
amendments effected hereby, to replace the presently outstanding Warrant held by
such Holder.
IN WITNESS WHEREOF, each of the parties hereto has executed this
Amendment No. 1 by its duly authorized officer as of the day and year first set
forth above.
AMERICAN MOBILE SATELLITE SINGAPORE TELECOMMUNICATIONS
CORPORATION LTD.
By: /s/XXXXXXX X. XXXXXXXXXX By: /s/HO SIAW HONG
--------------------------- ---------------------------
Name: Xxxxxxx X. Xxxxxxxxxx Name: Ho Siaw Hong
Title: VP & Treasurer Title: Senior Director
XXXXXX ELECTRONICS CORPORATION BARON CAPITAL PARTNERS, L.P.,
a Delaware limited partnership
By: /s/XXXXX XXXX
---------------------------
Name: Xxxxx Xxxx By: Baron Capital Management,
Title: Assistant Treasurer Inc., a General Partner
By: /s/XXXXX XXXXXX
-------------------------
Name: Xxxxx Xxxxxx
Title: V.P.
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