Exhibit 10.2
TAX SHARING AGREEMENT
This TAX SHARING AGREEMENT (this "Agreement"), dated as of December 30,
2005, by and between SkyTerra Communications, Inc., a Delaware corporation
("SkyTerra") and Xxxxxx Communications, Inc., a Delaware corporation and a
wholly owned subsidiary of SkyTerra ("Divco"). Each of SkyTerra and Divco is
sometimes referred to herein as a "Party" and collectively, as the "Parties."
WITNESSETH
WHEREAS, SkyTerra and Divco have entered into a Separation Agreement,
dated as of December 30, 2005 (the "Separation Agreement");
WHEREAS, SkyTerra intends to distribute all of the shares of Common
Stock(1) of Divco to the holders of capital stock, certain warrants and certain
options to purchase common stock of SkyTerra in the Distribution;
WHEREAS, at the close of business on the Distribution Date, the taxable
year of the Divco Consolidated Group (as defined below) shall close for U.S.
federal income tax purposes, and Divco and its Subsidiaries shall leave the
SkyTerra Consolidated Group (as defined below); and
WHEREAS, the Parties hereto wish to provide for the payment of Taxes
(each as defined below) and entitlement to Refunds (as defined below) thereof,
allocate responsibility for and provide for cooperation in connection with the
filing of returns in respect of Taxes, and provide for certain other matters
relating to Taxes;
NOW, THEREFORE, in consideration of the premises and the
representations, covenants and agreements herein contained and intending to be
legally bound hereby, the Parties hereto agree as follows:
1. Definitions. For purposes of this Agreement, the following terms
shall have the meanings set forth below:
"Actually Realized" shall mean, for purposes of determining the
timing of the realization of a Refund or Tax Attribute by a Person in respect of
any payment, transaction, occurrence or event, the time at which the amount of
Taxes paid or Refund realized by such Person is reduced below the amount of
Taxes that such Person would have been required to pay but for such payment,
transaction, occurrence or event (calculated, for these purposes, without regard
to the availability of any net operating loss, net capital loss, unused
investment credit, unused foreign Tax credit or any other Tax Attribute).
"Carryback" shall mean the carryback of a Tax Attribute by Divco
from a Post-Distribution Taxable Period to a Pre-Distribution Taxable Period.
"Carryback Benefit" shall mean, in respect of a Person or group of
Persons for any taxable period, the excess of (a) the hypothetical Tax Liability
of such Person or group of Persons for such taxable period, calculated as if the
Carryback had not occurred but with all other facts unchanged, over (b) the
actual Tax Liability of such Person or group of Persons for such taxable period,
calculated taking into account the Carryback (and treating any Refund as a
negative Tax Liability and taking into account credits, if any, for purposes of
such calculation).
"Code" shall mean the Internal Revenue Code of 1986, as amended.
"Combined Return" shall mean a consolidated, combined or unitary Tax
Return that actually includes, by election or otherwise, one or more members of
the SkyTerra Group together with Divco and/or any member of the Divco Group.
"Divco Consolidated Group" shall mean the affiliated group of
corporations (within the meaning of Section 1504(a) of the Code) of which Divco
is the common parent immediately after the Distribution (and any predecessor or
successor to such affiliated group).
"Divco Group" shall mean (a) Divco and each Person that is a direct
or indirect Subsidiary of Divco (including any Subsidiary of Divco that is
disregarded for U.S. federal income Tax purposes (or for purposes of any state,
local, or foreign Tax law)) immediately after the Distribution, (b) any
corporation (or other Person) that shall have merged or liquidated with or into
Divco or any such Subsidiary and (c) any predecessor or successor to any Person
otherwise described in this definition.
"Divco Separate Return" shall mean any Tax Return required to be
filed by any member of the Divco Group that does not include any member of the
SkyTerra Group.
"Final Determination" shall mean the final resolution of liability
for any Tax, which resolution may be for a specific issue or adjustment or for a
taxable period, (a) by IRS Form 870 or 870-AD (or any successor forms thereto),
on the date of acceptance by or on behalf of the taxpayer, or by a comparable
form under the laws of a state, local, or foreign taxing jurisdiction, except
that a Form 870 or 870-AD or comparable form shall not constitute a Final
Determination to the extent that it reserves (whether by its terms or by
operation of law) the right of the taxpayer to file a claim for Refund or the
right of the Taxing Jurisdiction to assert a further deficiency in respect of
such issue or adjustment or for such taxable period (as the case may be); (b) by
a decision, judgment, decree, or other order by a court of competent
jurisdiction, which has become final and unappealable; (c) by a closing
agreement or accepted offer in compromise under Sections 7121 or 7122 of the
Code, or a comparable agreement under the laws of a state, local, or foreign
Taxing Jurisdiction; (d) by any allowance of a Refund or credit in respect of an
overpayment of Tax, but only after the expiration of all periods during which
such Refund may be recovered (including by way of offset) by the Taxing
Jurisdiction imposing such Tax; or (e) by any other final disposition, including
by reason of the expiration of the applicable statute of limitations or by
mutual agreement of the Parties.
"Indemnified Party" shall mean any Person seeking indemnification
pursuant to the provisions of this Agreement.
"Indemnifying Party" shall mean any Party hereto from which any
Indemnified Party is seeking indemnification pursuant to the provisions of this
Agreement.
"Person" shall mean any individual, partnership, joint venture,
limited liability company, corporation, association, joint stock company, trust,
unincorporated organization or similar entity or a governmental authority or any
department or agency or other unit thereof.
"Post-Distribution Taxable Period" shall mean a taxable period that
begins after the Distribution Date.
"Pre-Distribution Taxable Period" shall mean a taxable period that
ends on or before the Distribution Date.
"Post-Change of Control Taxable Period" shall mean a taxable period
that begins after the closing date of a Change of Control.
"Pre-Change of Control Taxable Period" shall mean a taxable period
that ends on or before the closing date of a Change of Control.
"Proceeding" shall mean any audit or other examination, or judicial
or administrative proceeding relating to liability for, or Refunds or
adjustments with respect to, Taxes.
"Refund" shall mean any refund of Taxes, including any reduction in
Tax Liabilities by means of a credit, offset or otherwise.
"Representative" shall mean with respect to a Person, such Person's
officers, directors, employees and other authorized agents.
"Separation Agreement" shall have the meaning set forth in the
recitals of this Agreement.
"SkyTerra Consolidated Group" shall mean the affiliated group of
corporations (within the meaning of Section 1504(a) of the Code) of which
SkyTerra is the common parent (and any predecessor or successor to such
affiliated group).
"SkyTerra Group" shall mean (a) SkyTerra and each Person that is a
direct or indirect Subsidiary of SkyTerra (including any Subsidiary of SkyTerra
that is disregarded for U.S. federal income Tax purposes (or for purposes of any
state, local, or foreign Tax law)) immediately after the Distribution, (b) any
corporation (or other Person) that shall have merged or liquidated with or into
SkyTerra or any such Subsidiary and (c) any predecessor or successor to any
Person otherwise described in this definition.
"SkyTerra Separate Return" shall mean any Tax Return required to be
filed by any member of the SkyTerra Group that does not include any member of
the Divco Group.
"Straddle Period" shall mean any taxable period commencing on or
prior to, and ending after, the closing date of a Change of Control.
"Tax or Taxes" (a) means any and all federal, state, local, foreign
or other tax of any kind (together with any and all interest, penalties, fines,
additions to tax and additional amounts imposed with respect thereto) imposed by
any Taxing Jurisdiction, including taxes on or with respect to income,
alternative minimum, accumulated earnings, personal holding company, capital,
transfer, stamp, franchises, windfall or other profits, gross receipts,
property, sales, use, capital stock, payroll, employment, unemployment, social
security, workers' compensation or net worth, and taxes in the nature of excise,
withholding, ad valorem or value added and (b) shall include any transferee
liability in respect of an amount described in clause (a) of this definition.
"Tax Attribute" shall mean any net operating loss, net capital loss,
unused investment credit, unused foreign Tax credit, excess charitable
contribution, minimum Tax credit or general business credit, in each case, with
respect to the current year and any carryover.
"Tax Liabilities" shall mean all liabilities for Taxes.
"Tax Return" shall mean any return, report, filing, statement,
questionnaire, declaration or other document required to be filed with a Taxing
Jurisdiction in respect of Taxes, including any attachments thereto, and any
information return, claim for refund, amended return or declaration of estimated
Taxes.
"Taxing Jurisdiction" a governmental authority (foreign or domestic)
or any subdivision, agency, commission or authority thereof having jurisdiction
over the assessment, determination, collection or imposition of any Tax
(including, without limitation, the IRS) on SkyTerra, Divco or any of their
respective Affiliates.
"Underpayment Rate" shall mean the annual rate of interest described
in Section 6621(c) of the Code for large corporate underpayments of income Tax
(or similar provision of state, local, or foreign income Tax law, as
applicable), as determined from time to time.
2. Filing of Tax Returns; Payment of Taxes.
a. Combined Returns, SkyTerra Consolidated Group Returns and
SkyTerra Separate Returns.
(i) SkyTerra shall prepare and file (or cause to be prepared and
filed) (A) all Combined Returns, (B) all other consolidated Tax Returns of the
SkyTerra Consolidated Group and (C) all SkyTerra Separate Returns. SkyTerra
shall pay (or cause to be paid) any and all Taxes due with respect to such
Combined Returns, other consolidated Tax Returns of the SkyTerra Consolidated
Group and SkyTerra Separate Returns; provided that, with respect to any payments
of such Taxes made after the Distribution Date, Divco shall be liable for (A)
all Taxes shown due on such Combined Returns (including all Tax Liabilities
resulting from the Distribution and the restructuring related thereto) other
than any Taxes that directly or indirectly relate to MSV or Terrestar and (B)
all Taxes shown due on such other consolidated Tax Returns of the SkyTerra
Consolidated Group and SkyTerra Separate Returns for all Pre-Change of Control
Taxable Periods and, with respect to any Straddle Period, the portion of such
Straddle Period ending on the closing date of the Change of Control, in all
cases, other than any Taxes that directly or indirectly related to MSV,
Terrestar or a Change of Control; and provided further that, Divco shall not be
liable for any Taxes with respect to such Combined Returns, other consolidated
Tax Returns of the SkyTerra Consolidated Group and SkyTerra Separate Returns to
the extent any Tax Attribute is available to any member of the SkyTerra Group to
reduce the amount of any such Taxes.
(ii) The allocation of Taxes for a Straddle Period shall be
apportioned between the Pre-Change of Control Taxable Period and the Post-Change
of Control Taxable Period based on a closing of the books method as if the
closing date of the Change of Control was the end of the taxable period.
(iii) With respect to any member of the Divco Group that is
included in both a Divco Separate Return pursuant to Section 2(b) and a Combined
Return, Divco shall provide to SkyTerra a schedule setting forth the items of
income, gain, loss, deduction and credit of such member with respect to such
Combined Return no later than forty-five (45) days prior to the due date
(including extensions) for the filing of such Combined Return, and SkyTerra
shall prepare such Combined Return in accordance with the schedule Divco so
provides.
(iv) All Combined Returns, other consolidated Tax Returns of the
SkyTerra Consolidated Group and SkyTerra Separate Returns that include Taxes for
which Divco is liable shall be (A) prepared by SkyTerra, in a manner consistent
with past practice, to the extent permissible under applicable law and (B) duly
and timely filed by SkyTerra in accordance with all applicable laws. All such
Tax Returns shall be submitted to Divco no later than thirty (30) days prior to
the due date (including extensions) for filing of such Tax Returns (or if such
due date is within forty-five (45) days following the Distribution Date, as
promptly as practicable following the Distribution Date). Divco shall have the
right to review such Tax Returns and all work papers and procedures used to
prepare such Tax Returns. Within ten (10) days after delivery of any such Tax
Return, Divco shall notify SkyTerra in writing if it objects to any of the items
in such Tax Return which items could reasonably be expected to adversely impact
any member of the Divco Group. If Divco does not so notify SkyTerra of any
objection, Divco shall be considered to have consented to the filing of such Tax
Return. If Divco objects to any such item on such a Tax Return, SkyTerra and
Divco shall attempt in good faith to resolve the dispute and, if they are unable
to do so, the disputed items shall be resolved (within a reasonable time, taking
into account the deadline for filing such Tax Return) in accordance with Section
10(d). Upon resolution of all such items, the relevant Tax Return shall be filed
on that basis. Divco shall pay to SkyTerra the Taxes for which it is liable no
later than five (5) Business Days prior to the due date for the payment of such
Taxes.
b. Divco Separate Returns. Divco shall prepare and file (or cause to
be prepared and filed) all Divco Separate Returns. Divco shall pay (or cause to
be paid) and shall be solely liable for any and all Taxes due with respect to
such Tax Returns.
c. Apportionment of Tax Attributes. Without limiting the provisions
of Section 7, SkyTerra shall provide to Divco on or prior to the earlier of a
Change of Control or September 1, 2006 (i) a Tax basis balance sheet for Divco
setting forth the Tax basis of all of the assets of Divco as of the Distribution
Date and (ii) a schedule allocating to Divco its appropriate share of Tax
Attributes in all Taxing Jurisdictions in which Divco is subject to Taxes.
SkyTerra and Divco shall prepare and file all Tax Returns in a manner consistent
with the allocations in the immediately preceding sentence and shall not
otherwise take any position inconsistent with such allocations in any Tax
Return, any Proceeding or otherwise.
d. Tax Sharing Agreements. Other than with respect to this
Agreement, all Tax sharing agreements or similar arrangements or agreements with
respect to or involving any member of the Divco Group and any other Person
(other than a member of the Divco Group) shall be terminated as of the
Distribution Date and, after the Distribution Date, Divco shall not be bound
thereby or have any liability thereunder.
e. Transfer Taxes. Divco shall bear any and all stamp, duty,
transfer, sales and use or similar Taxes ("Transfer Taxes") incurred in
connection with the Distribution.
3. Indemnification for Taxes.
a. Indemnification by SkyTerra. SkyTerra shall indemnify, defend and
hold harmless Divco and each member of the Divco Group and each of their
respective Representatives and Affiliates (and the successors and assigns of any
of them), without duplication, from and against any Taxes and any reasonable
out-of-pocket expenses (other than any expenses relating to any Proceeding as
described in Section 5(a)(i)) attributable to or arising from or related to all
Taxes imposed on or attributable to SkyTerra or any member of the SkyTerra Group
pursuant to Section 2.
b. Indemnification by Divco. Divco shall indemnify, defend and hold
harmless SkyTerra and each member of the SkyTerra Group and each of their
respective Representatives and Affiliates (and the successors and assigns of any
of them), without duplication, from and against any Taxes and any reasonable
out-of-pocket expenses (other than any expenses relating to any Proceeding as
described in Section 5(b)(i)) attributable to or arising from or related to (i)
all Taxes imposed on or attributable to Divco or any member of the Divco Group
pursuant to Section 2 (including, without limitation, all Tax Liabilities
resulting from the Distribution and the restructuring related thereto), (ii) all
Taxes of any member of an affiliated, consolidated, combined or unitary group of
which any member of the SkyTerra Consolidated Group was a member prior to the
closing date of any Change of Control pursuant to Treasury Regulations Section
1.1502-6 or analogous or similar state, local, or foreign law or regulation and
(iii) all Transfer Taxes for which Divco is responsible for pursuant to Section
2(e). Notwithstanding anything in this Agreement to the contrary, Divco shall
not be liable for any Tax Liability attributable to or arising from or related
to any Change of Control.
c. Timing of Indemnification. Any payment and indemnification made
pursuant to this Section 3 shall be made by the Indemnifying Party promptly,
but, in any event, no later than:
(i) in the case of an indemnification obligation with respect to
any Tax Liabilities, five (5) Business Days prior to the date the Indemnified
Party makes a payment of Taxes to the applicable Taxing Jurisdiction (including
a payment with respect to a proposed adjustment of Taxes or an assessment of Tax
deficiency asserted or made by any Taxing Jurisdiction or a payment made in
settlement of an asserted Tax deficiency) or realizes a reduced Refund; and
(ii) in the case of any payment or indemnification of any
reasonable out-of-pocket expenses not otherwise described in clause (i) of this
Section 3(c) (including, but not limited to, any attorneys' fees and expenses),
five (5) Business Days prior to the date the Indemnified Party makes a payment
thereof.
4. Refunds.
a. Any Refund attributable to any Tax Liabilities for which any
member of the Divco Group is responsible for pursuant to Section 2 shall be for
the account of Divco. To the extent SkyTerra receives a Refund referred to in
the immediately preceding sentence, SkyTerra shall promptly pay the amount of
the Refund to Divco. Any Refund attributable to any Tax Liabilities for which
any member of the SkyTerra Group is responsible for pursuant to Section 2 shall
be for the account of SkyTerra. To the extent Divco receives a Refund referred
to in the immediately preceding sentence, Divco shall promptly pay or cause to
be paid the amount of the Refund to SkyTerra.
b. Each Party shall, if reasonably requested by the other Party,
cause the relevant entity to file for and use its reasonable best efforts to
obtain and expedite the receipt of any Refund to which such requesting Party is
entitled under Section 4(a).
5. Tax Contests.
a. Tax Contests With Respect to the SkyTerra Group. SkyTerra (or
such member of the SkyTerra Group as SkyTerra shall designate) shall have the
right to control and represent the interests of the members of the SkyTerra
Group and to employ counsel of its choice at its expense in any Proceeding for
any matter resulting in any asserted Tax Liability with respect to which
SkyTerra provides indemnification under Section 3; provided however, with
respect to any Proceeding that could reasonably be expected to adversely impact
Divco or any member of the Divco Group, (i) Divco (or such member of the Divco
Group as Divco shall designate) shall have the right to participate and to
employ counsel of its choice at its expense in such Proceeding and (ii) SkyTerra
shall not settle any such Proceeding without Divco's prior written consent,
which consent shall not be unreasonably withheld or delayed.
b. Tax Contests With Respect to the Divco Group. Divco (or such
member of the Divco Group as Divco shall designate) shall have the right to
control and represent the interests of the members of the Divco Group and to
employ counsel of its choice at its expense in any Proceeding for any matter
resulting in any asserted Tax Liability with respect to which Divco provides
indemnification under Section 3; provided however, with respect to any
Proceeding that could reasonably be expected to adversely impact SkyTerra or any
member of the SkyTerra Group, (i) SkyTerra (or such member of the SkyTerra Group
as SkyTerra shall designate) shall have the right to participate and to employ
counsel of its choice at its expense in such Proceeding and (ii) Divco shall not
settle any such Proceeding without SkyTerra's prior written consent, which
consent shall not be unreasonably withheld or delayed.
c. Notification. With respect to any indemnification which may be
claimed pursuant to the provisions of Section 3, (i) the Indemnified Party shall
notify the Indemnifying Party (or cause the Indemnifying Party to be notified)
within ten (10) days of receipt of any written communication by the Indemnified
Party from or with any Taxing Jurisdiction and (ii) the Indemnified Party shall
notify the Indemnifying Party (or cause the Indemnifying Party to be notified)
at least ten (10) days prior to the date the Indemnified Party intends to make a
payment of any Taxes. The failure by the Indemnified Party to notify the
Indemnifying Party pursuant to this Section 5(c) shall not constitute a waiver
of any of the Indemnified Party's claims to indemnification except to the extent
of material prejudice to the Indemnifying Party.
6. Carrybacks.
a. Carrybacks. Upon Divco's request, SkyTerra shall file for all
Carrybacks and use its best efforts to obtain and expedite the receipt of any
Refunds or CarryBack Benefits resulting from such Carrybacks. SkyTerra shall
promptly forward, in all cases no later than five (5) days after such Refund or
Carryback Benefit is Actually Realized, to Divco (i) all Refunds resulting from
any Carryback (including any interest thereon) received from a Taxing
Jurisdiction and (ii) the amount of any Carryback Benefit Actually Realized by a
member of the SkyTerra Group, to the extent attributable to a Carryback.
7. Cooperation and Exchange of Information.
a. Cooperation and Exchange of Information. Each of SkyTerra and
Divco, on behalf of itself and each member of the SkyTerra Group and the Divco
Group, respectively, shall provide the other Party (or its designee) with such
cooperation or information as such other Party (or its designee) reasonably
shall request in connection with the preparation or filing of any Tax Return,
claim for Refund, the conduct of any Proceeding or any other matter related to
Taxes. Such cooperation and information shall include, without limitation, upon
reasonable notice (i) making employees and facilities available on a mutually
convenient basis to provide such assistance as might reasonably be required and
(ii) providing, or causing to be provided, such information as might reasonably
be required in connection with any such Tax Return, claim for Refund,
Proceeding, including, without limitation, records, Tax Returns, documents, work
papers or other relevant materials and (iii) executing any document that may be
necessary in connection with the filing of a Tax Return, a claim for a Refund or
any Proceeding, including such waivers, consents or powers of attorney as may be
necessary for SkyTerra. Any information obtained under this Section 7 shall be
kept confidential, except as otherwise reasonably may be necessary in connection
with the filing of Tax Returns or claims for Refund or in conducting any
Proceeding.
b. Retention of Records. Each of SkyTerra and Divco shall retain all
Tax Returns, workpapers, and all material records and other documents existing
on the date hereof or created in respect of (i) any taxable period that ends on
or before or includes the Distribution Date or (ii) any taxable period that may
be subject to a claim hereunder until the later of (A) the expiration of the
statute of limitations (including extensions) for the taxable periods to which
such Tax Returns and other documents relate, (B) if a Tax Attribute may be
carried from a Pre-Distribution Taxable Period to a Post-Distribution Taxable
Period, the expiration of the statute of limitations (including extensions) for
the earlier of (x) the year to which the Tax Attribute may be carried or (y) the
year to which the Tax Attribute is actually carried and (C) the Final
Determination of any payments that may be required in respect of such taxable
periods under this Agreement. From and after the end of the period described in
the immediately preceding sentence, (A) if a member of the SkyTerra Group wishes
to dispose of any such records and documents, then SkyTerra shall provide
written notice thereof to Divco and shall provide Divco the opportunity to take
possession of any such records and documents within 90 days after such notice is
delivered; provided, however, that if Divco does not, within such 90-day period,
confirm its intention to take possession of such records and documents, SkyTerra
may destroy or otherwise dispose of such records and documents and (B) if a
member of the Divco Group wishes to dispose of any such records or documents
that relate to any Tax Attributes of any member of the SkyTerra Group, then
Divco shall provide written notice thereof to SkyTerra and shall provide
SkyTerra the opportunity to take possession of any such records and documents
within 90 days after such notice is delivered; provided, however, that if
SkyTerra does not, within such 90-day period, confirm its intention to take
possession of such records and documents, Divco may destroy or otherwise dispose
of such records and documents.
8. Payments.
a. Method of Payment. All payments required by this Agreement shall
be made by (i) wire transfer to the appropriate bank account as may from time to
time be designated by the Parties for such purpose; provided that, on the date
of such wire transfer, notice of the transfer is given to the recipient thereof
in accordance with Section 10(c), or (ii) any other method agreed to by the
Parties. All payments due under this Agreement shall be deemed to be paid when
available funds are actually received by the payee.
b. Interest. Any payment required by this Agreement that is not made
on or before the date required hereunder shall bear interest, from and after
such date through the date of payment, at the Underpayment Rate.
c. Characterization of Payments. For all Tax purposes, the Parties
hereto shall treat, and cause their respective Affiliates to treat, (i) any
payment required by this Agreement or by Article XI of the Separation Agreement
as either a contribution by SkyTerra to Divco or a distribution by Divco to
SkyTerra, as the case may be, occurring immediately prior to the Distribution
and (ii) any payment of interest or non-federal income Taxes by or to a Taxing
Jurisdiction as taxable or deductible, as the case may be, to the Party entitled
under this Agreement to retain such payment or required under this Agreement to
make such payment, in either case, except as otherwise required by applicable
law.
9. Designation of Affiliate. Each of SkyTerra on the one hand and Divco
on the other hand may assign any of its rights or obligations under this
Agreement to any member of the SkyTerra Group or the Divco Group, respectively,
as it shall designate; provided, however, that no such assignment shall relieve
SkyTerra on the one hand or Divco on the other hand of any obligation to make a
payment hereunder to the extent such designee fails to make such payment.
10. Miscellaneous.
a. Entire Agreement. This Agreement constitutes the entire agreement
among the Parties with respect to the subject matter of this Agreement and shall
supersede all prior written and oral and all contemporaneous oral agreements and
understandings with respect to the subject matter of this Agreement. No
promises, covenants or representations of any kind, other than those expressly
stated herein, have been made to induce any Party to enter this Agreement. This
Agreement shall not be modified or terminated except by a termination of the
Separation Agreement or by a writing duly signed by each of the Parties hereto,
and no waiver of any provisions of this Agreement shall be effective unless in a
writing duly signed by the Party sought to be bound. If, and to the extent, the
provisions of this Agreement conflict with the Separation Agreement, or any
other agreement entered into in connection with the Distribution, the provisions
of this Agreement shall control.
b. Governing Law. This Agreement shall be construed in accordance
with the laws of New York applicable to contracts made and wholly performed
within such state, without regard to principles of choice of law.
c. Notices. Notices, offers, requests or other communications
required or permitted to be given by either Party pursuant to the terms of this
Agreement shall be given in writing to the respective Parties to the following
addresses:
if to SkyTerra:
SkyTerra Communications, Inc.
00 Xxxx 00xx Xxxxxx, Xxxxx 000
Xxx Xxxx, Xxx Xxxx 00000
Facsimile: 000-000-0000
Attention: Xxxxxx X. Xxxxx,
Senior Vice President and General Counsel
if to Divco:
Xxxxxx Communications, Inc.
00 Xxxx 00xx Xxxxxx, Xxxxx 000
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx X. Xxxxx,
copies of all notices (which shall not constitute notice)
hereunder shall be delivered to:
Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP
Xxxx Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Facsimile: (000) 000-0000
Attention: Xxxxxx X. Xxxxxxxxxxx, Esq.
or to such other address as the Party to whom notice is given may have
previously furnished in writing as provided herein. Any notice involving
non-performance, termination, or renewal shall be sent by hand delivery,
recognized overnight courier or, within the United States, may also be sent via
certified mail, return receipt requested. All other notices may also be sent by
fax, confirmed by first class mail. All notices shall be deemed to have been
given and received on the earlier of actual delivery or three (3) Business Days
from the date of postmark.
d. Disputes. If Divco and SkyTerra cannot agree as to the
calculation of any liability under this Agreement or as to the proper
interpretation of any provision of this Agreement, any such matter in dispute
shall be resolved by a nationally recognized accounting firm acceptable to both
Divco and SkyTerra. The decision of such firm shall be final and binding. The
fees and expenses of such accounting firm incurred in connection with the
resolution of any such dispute shall be borne by the Parties in proportion to
their respective liabilities.
e. Counterparts. This Agreement may be executed in counterparts,
each of which shall be deemed to be an original but all of which shall
constitute one and the same agreement.
f. Binding Effect; Assignment. This Agreement shall inure to the
benefit of and be binding upon the Parties and their respective legal
representatives and successors, and nothing in this Agreement, express or
implied, is intended to confer upon any other Person any rights or remedies of
any nature whatsoever under or by reason of this Agreement. Except as set forth
in Section 9 neither Party may assign this Agreement or any rights or
obligations under this Agreement without the prior written consent of the others
and any such assignment shall be void.
g. Severability. If any term or other provision of this is
determined by a governmental authority to be invalid, illegal or incapable of
being enforced by any applicable law, all other conditions and provisions of
this Agreement shall nevertheless remain in full force and effect so long as the
economic or legal substance of the transactions contemplated by this Agreement
is not materially affected. Upon such determination that any term or other
provision is invalid, illegal or incapable of being enforced, the Parties shall
negotiate in good faith to modify this Agreement so as to effect the original
intent of the Parties as closely as possible in an acceptable manner to the end
that transactions contemplated by this Agreement are fulfilled to the fullest
extent possible.
h. Failure or Indulgence Not Waiver: Remedies Cumulative. No failure
or delay on the part of any Party in the exercise of any right under this
Agreement shall impair such right or be construed to be a waiver of, or
acquiescence in, any breach of any representation, warranty or agreement in this
Agreement, nor shall any single or partial exercise of any such right preclude
other or further exercise thereof or of any other right. All rights and remedies
existing under this Agreement are cumulative to, and not exclusive of, any
rights or remedies otherwise available.
i. Amendment. No change or amendment will be made to this Agreement
except by an instrument in writing signed on behalf of each of the Parties to
this Agreement.
j. Authority. Each of the Parties represents to the others that (a)
it has the corporate or other requisite power and authority to execute, deliver
and perform this Agreement, (b) the execution, delivery and performance of this
Agreement by it have been duly authorized by all necessary corporate or other
actions, (c) it has duly and validly executed and delivered this Agreement, and
(d) this Agreement is a legal, valid and binding obligation, enforceable against
it in accordance with its terms.
k. Interpretation. The headings contained in this Agreement are for
reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement. When a reference is made in this Agreement to
a Section such reference shall be to a Section of this Agreement unless
otherwise indicated. Nothing in this Agreement shall be interpreted as imposing
an obligation on SkyTerra or the members of the SkyTerra Group, Divco or the
members of the Divco Group that is in violation of applicable law.
l. Survival. Notwithstanding anything in this Agreement to the
contrary, any claim for indemnification to be made under this Agreement must
relate to a claim with respect to Taxes, the written notice of which is received
by at least one of the Parties from a Taxing Jurisdiction within the four-year
period beginning on the Distribution Date.
[EXECUTION PAGE FOLLOWS]
IN WITNESS WHEREOF, each of the Parties has caused this Agreement to be executed
on its behalf by its officers thereunto duly authorized, all as of the day and
year first written above.
SKYTERRA COMMUNICATIONS, INC.
By: /s/ XXXXXX X. XXXXX
------------------------------------
Name: Xxxxxx X. Xxxxx
Title: Senior Vice President, General
Counsel and Secretary
XXXXXX COMMUNICATIONS, INC.
By: /s/ XXXXXX X. XXXXX
------------------------------------
Name: Xxxxxx X. Xxxxx
Title: Senior Vice President, General
Counsel and Secretary
------------------------------------
(1) Capitalized terms used but not otherwise defined herein shall have the
respective meanings assigned to them in the Separation Agreement.
