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EXHIBIT 1.2
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DRAFT 6/3/97
IRIDIUM WORLD COMMUNICATIONS LTD.
(a Bermuda company)
2,000,000 Shares of Class A Common Stock
INTERNATIONAL PURCHASE AGREEMENT
Dated: __________, 1997
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TABLE OF CONTENTS
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INTERNATIONAL PURCHASE AGREEMENT. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
SECTION 1. Representations and Warranties . . . . . . . . . . . . . . . . . . . . . 4
(a) Representations and Warranties by the Company and Iridium . . . . 4
(i) Compliance with Registration Requirements . . . . . . . 4
(ii) Independent Accountants . . . . . . . . . . . . . . . . 5
(iii) Financial Statements . . . . . . . . . . . . . . . . . 5
(iv) No Material Adverse Change in Business . . . . . . . . 6
(v) Good Standing of the Company and Iridium . . . . . . . 6
(vi) No Significant Subsidiary . . . . . . . . . . . . . . . 6
(vii) Capitalization . . . . . . . . . . . . . . . . . . . . 6
(viii) Authorization of Agreement . . . . . . . . . . . . . . 7
(ix) Authorization and Description of Securities . . . . . . 7
(x) Absence of Defaults and Conflicts . . . . . . . . . . . 8
(xi) Absence of Labor Dispute . . . . . . . . . . . . . . 9
(xii) Absence of Proceedings . . . . . . . . . . . . . . . . 9
(xiii) Accuracy of Exhibits . . . . . . . . . . . . . . . . . 9
(xiv) Possession of Intellectual Property . . . . . . . . . . 9
(xv) Absence of Further Requirements . . . . . . . . . . . . 9
(xvi) Possession Licenses and Permits . . . . . . . . . . . . 10
(xvii) Title to Property . . . . . . . . . . . . . . . . . . . 10
(xviii) Compliance with Cuba Act . . . . . . . . . . . . . . . 11
(xix) Investment Company Act . . . . . . . . . . . . . . . . 11
(xx) Environmental Laws . . . . . . . . . . . . . . . . . . 11
(xxi) Registration Rights . . . . . . . . . . . . . . . . . . 11
(xxii) Principal Agreements . . . . . . . . . . . . . . . . . 11
(xxiii) Governance Agreements . . . . . . . . . . . . . . . . . 12
(xxiv) FCC License . . . . . . . . . . . . . . . . . . . . . . 13
(xxv) Forward Looking Statements . . . . . . . . . . . . . . 13
(xxvi) Certain Descriptions . . . . . . . . . . . . . . . . . 13
(xxvii) Accounting Controls . . . . . . . . . . . . . . . . . . 13
(b) Officer's Certificates . . . . . . . . . . . . . . . . . . . . . . 14
SECTION 2. Sale and Delivery to International Managers; Closing. . . . . . . . . . 14
(a) Initial Securities . . . . . . . . . . . . . . . . . . . . . . . . 14
(b) Option Securities . . . . . . . . . . . . . . . . . . . . . . . . 14
(c) Payment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
(d) Denominations; Registration . . . . . . . . . . . . . . . . . . . 15
SECTION 3. Covenants of the Company . . . . . . . . . . . . . . . . . . . . . . . . 15
(a) Compliance with Securities Regulations and Commission Requests . . 15
(b) Filing of Amendments . . . . . . . . . . . . . . . . . . . . . . . 16
(c) Delivery of Registration Statements . . . . . . . . . . . . . . . 16
(d) Delivery of Prospectuses . . . . . . . . . . . . . . . . . . . . . 16
(e) Continued Compliance with Securities Laws . . . . . . . . . . . . 17
(f) Blue Sky Qualifications . . . . . . . . . . . . . . . . . . . . . 17
(g) Rule 158 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
(h) Use of Proceeds . . . . . . . . . . . . . . . . . . . . . . . . . 18
(i) Listing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
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(j) Restriction on Sale of Securities . . . . . . . . . . . . . . . . 18
(k) Reporting Requirements . . . . . . . . . . . . . . . . . . . . . . 18
(l) Compliance with NASD Rules . . . . . . . . . . . . . . . . . . . . 19
[(m) Compliance with Rule 463 . . . . . . . . . . . . . . . . . . . . . 19
(n) Exchange Agreement . . . . . . . . . . . . . . . . . . . . . . . . 19
SECTION 4. Covenants of Iridium . . . . . . . . . . . . . . . . . . . . . . . . . . 19
(a) Exchange Agreement . . . . . . . . . . . . . . . . . . . . . . . . 19
(b) Use of Proceeds . . . . . . . . . . . . . . . . . . . . . . . . . 19
SECTION 5. Payment of Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
(a) Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
(b) Termination of Agreement . . . . . . . . . . . . . . . . . . . . . 20
SECTION 6. Conditions of International Managers' Obligations . . . . . . . . . . . 20
(a) Effectiveness of Registration Statement . . . . . . . . . . . . . 20
(b) Letter and Opinion of Counsel for Company and Iridium . . . . . . 21
(c) Opinion of Bermuda Counsel for the Company . . . . . . . . . . . . 21
(d) Opinion of Regulatory Counsel for Motorola Satellite
Communications, Inc. . . . . . . . . . . . . . . . . . . . . . . . 21
(e) Opinion of Assistant Secretary of the Company and General
Counsel of Iridium . . . . . . . . . . . . . . . . . . . . . . . . 21
(f) Opinion of Counsel for International Managers . . . . . . . . . . 21
(g) Opinion of Regulatory Counsel for the International Managers . . . 21
(h) Officers' Certificate . . . . . . . . . . . . . . . . . . . . . . 22
(i) Accountant's Comfort Letter . . . . . . . . . . . . . . . . . . . 22
(j) Bring-down Comfort Letter . . . . . . . . . . . . . . . . . . . . 22
(k) Approval of Listing . . . . . . . . . . . . . . . . . . . . . . . 22
(l) No Objection . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
(m) Motorola Certificate . . . . . . . . . . . . . . . . . . . . . . . 22
(n) Purchase of Initial U.S. Securities . . . . . . . . . . . . . . . 23
(o) Conditions to Purchase of International Option Securities . . . . 23
(p) Transactions . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
(q) Additional Documents . . . . . . . . . . . . . . . . . . . . . . . 24
(r) Termination of Agreement . . . . . . . . . . . . . . . . . . . . . 24
(s) Lock-up Agreements . . . . . . . . . . . . . . . . . . . . . . . . 24
SECTION 7. Indemnification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
(a) Indemnification of International Managers. . . . . . . . . . . . . 24
(b) Indemnification of Company, Iridium, Directors and Officers . . . 26
(c) Actions against Parties; Notification . . . . . . . . . . . . . . 26
(d) Settlement without Consent if Failure to Reimburse . . . . . . . . 27
(e) Indemnification for Reserved Securities . . . . . . . . . . . . . 27
SECTION 8. Contribution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
SECTION 9. Representations, Warranties and Agreements to Survive Delivery . . . . . 29
SECTION 10. Termination of Agreement . . . . . . . . . . . . . . . . . . . . . . . . 29
(a) Termination; General . . . . . . . . . . . . . . . . . . . . . . . 29
(b) Liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
SECTION 11. Default by One or More of the International Managers . . . . . . . . . . 29
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SECTION 12. Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
SECTION 13. Parties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
SECTION 14. Governing Law And Time . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
SECTION 15. Effect of Headings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
SCHEDULES
SCHEDULE A - LIST OF INTERNATIONAL MANAGERS . . . . . . . . . . . . . . . . . . SCH A-1
SCHEDULE B - PRICING INFORMATION . . . . . . . . . . . . . . . . . . . . . . . SCH B-1
SCHEDULE C - PERSONS SUBJECT TO LOCK-UP . . . . . . . . . . . . . . . . . . . . SCH C-1
EXHIBITS
EXHIBIT A-1 - FORM OF OPINION OF COMPANY'S AND
IRIDIUM'S COUNSEL . . . . . . . . . . . . . . . . . . . . . . . . . A-1
EXHIBIT A-2 - FORM OF OPINION OF COMPANY'S
BERMUDA COUNSEL . . . . . . . . . . . . . . . . . . . . . . . . . . A-4
EXHIBIT A-3 - FORM OF OPINION OF REGULATORY COUNSEL
MOTOROLA SATELLITE COMMUNICATIONS, INC. . . . . . . . . . . . . . . A-7
EXHIBIT A-4 - FORM OF OPINION OF ASSISTANT
SECRETARY AND GENERAL COUNSEL . . . . . . . . . . . . . . . . . . . A-8
EXHIBIT B- FORM OF MOTOROLA CERTIFICATE . . . . . . . . . . . . . . . . . . . . . B-1
EXHIBIT C- FORM OF LOCK-UP AGREEMENT . . . . . . . . . . . . . . . . . . . . . . . C-1
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Draft of June 3, 1997
IRIDIUM WORLD COMMUNICATIONS LTD.
(a Bermuda company)
2,000,000 Shares of Class A Common Stock
(Par Value $.01 Per Share)
Dated: _________, 1997
XXXXXXX XXXXX INTERNATIONAL
Xxxxxxxxx, Lufkin & Xxxxxxxx
Securities Corporation
Xxxxxxx Sachs International
as Lead Manager(s) of the several International Managers
c/o Merrill Xxxxx International
00 Xxxxxxxxxx Xxxx
Xxxxxx XXXX 0XX
Xxxxxxx
Ladies and Gentlemen:
Each of Iridium World Communications Ltd., a Bermuda company (the
"Company") and Iridium LLC, a Delaware limited liability company ("Iridium"),
confirms its agreement with Xxxxxxx Xxxxx International ("Xxxxxxx Xxxxx") and
each of the other international underwriters named in Schedule A hereto
(collectively, the "International Managers", which term shall also include any
underwriter substituted as hereinafter provided in Section 11 hereof), for whom
Xxxxxxx Lynch, Donaldson, Lufkin & Xxxxxxxx Securities Corporation and Xxxxxxx
Sachs International are acting as representatives (in such capacity, the "Lead
Managers"), with respect to the issue and sale by the Company and the purchase
by the International Managers, acting severally and not jointly, of the
respective numbers of shares of Class A Common Stock, par value $.01 per share,
of the Company ("Class A Common Stock") set forth in said Schedule A, and with
respect to the grant by the Company to the International Managers, acting
severally and not jointly, of the option described in Section 2(b) hereof to
purchase all or any part of 300,000 additional shares of Class A Common Stock
to cover over-allotments, if any. The aforesaid 2,000,000 shares of Class A
Common Stock (the "Initial International Securities") to be purchased by the
International Managers and all or any part of the 300,000 shares of Class A
Common Stock subject to the option described in Section 2(b) hereof (the
"International Option Securities") are hereinafter called, collectively, the
"International Securities."
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It is understood that each of the Company and Iridium is concurrently
entering into an agreement dated the date hereof (the "U.S. Purchase
Agreement") providing for the offering by the Company of an aggregate of
8,000,000 shares of Class A Common Stock (the "Initial U.S. Securities")
through arrangements with certain underwriters in the United States and Canada
(the "U.S. Underwriters") for which Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated, Xxxxxxxxx, Lufkin & Xxxxxxxx Securities Corporation and Xxxxxxx,
Sachs & Co. are acting as representatives (the "U.S. Representatives") and the
grant by the Company to the U.S. Underwriters, acting severally and not
jointly, of an option to purchase all or any part of the U.S. Underwriters' pro
rata portion of up to 1,200,000 additional shares of Class A Common Stock
solely to cover overallotments, if any (the "U.S. Option Securities" and,
together with the International Option Securities, the "Option Securities").
The Initial U.S. Securities and the U.S. Option Securities are hereinafter
called the "U.S. Securities." It is understood that the Company is not
obligated to sell and the International Managers are not obligated to purchase,
any Initial International Securities unless all of the Initial U.S. Securities
are contemporaneously purchased by the U.S. Underwriters.
The International Managers and the U.S. Underwriters are hereinafter
collectively called the "Underwriters," the Initial International Securities
and the Initial U.S. Securities are hereinafter collectively called the
"Initial Securities," and the International Securities, and the U.S. Securities
are hereinafter collectively called the "Securities."
The Underwriters are concurrently entering into an Intersyndicate
Agreement of even date herewith (the "Intersyndicate Agreement") providing for
the coordination of certain transactions among the Underwriters under the
direction of Xxxxxxx Xxxxx & Co., Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated (in such capacity, the "Global Coordinator").
The Company understands that the International Managers propose to
make a public offering of the International Securities as soon as the Lead
Managers deem advisable after this Agreement has been executed and delivered.
The Company and the U.S. Underwriters have agreed that up to 1,000,000
shares of the Initial U.S. Securities to be purchased by the U.S. Underwriters
(the "Reserved Securities") shall be reserved for sale by the Underwriters to
eligible employees of the Company and Iridium and persons having business
relationships with Iridium as part of the distribution of the Securities by the
Underwriters, subject to the terms of this Agreement, the applicable rules,
regulations and interpretations of the National Association of Securities
Dealers, Inc. and all other applicable laws, rules and regulations. To the
extent that such Reserved Securities are not orally confirmed for purchase by
such eligible employees of the Company and Iridium and persons having business
relationships with Iridium by the end of the first business day after the date
of this Agreement, such Reserved Securities may be offered to the public as
part of the public offering contemplated hereby. Offers and sales of Reserved
Securities to eligible employees of the Company and Iridium and persons having
business relationships with Iridium in the Province of Canada will be effected
by the U.S. Underwriters or their affiliates at the request of and as agent of
the Company pursuant to prospectus exemption available in Quebec.
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The Company and Iridium have entered into (i) an Interest Exchange
Agreement (the "Exchange Agreement"), (ii) a 1997 Subscription Agreement (the
"1997 Subscription Agreement"), (iii) a Share Issuance Agreement (the "Share
Issuance Agreement") and (iv) a Management Services Agreement (the "Management
Services Agreement" and, collectively with the Exchange Agreement, the 1997
Subscription Agreement, the Share Issuance Agreement and the LLC Agreement (as
defined below), the "Governance Agreements"). On or prior to Closing Time (as
defined below), (A) pursuant to an amendment to the LLC Agreement, each Class 1
Membership Interest in Iridium (each a "Class 1 Interest") shall be subdivided
into 75 Class 1 Interests and each warrant an option to purchase Class 1
Interest, and the conversion price of each limited liability company interest
in Iridium that is or may become convertible into or exchangeable for Class 1
Interests, shall be adjusted accordingly, (B) Iridium shall issue and sell to
the Company and the Company shall purchase from Iridium Class 1 Interests under
the 1997 Subscription Agreement with the proceeds from the issuance and sale of
the Securities as contemplated by this Agreement, the International Purchase
Agreement and the Registration Statement (as defined below) and (C) the Company
shall be admitted as a member of Iridium (collectively, the "Transactions").
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-1 (No. 333-23419) covering the
registration of the Securities under the Securities Act of 1933, as amended
(the "1933 Act"), including the related preliminary prospectus or prospectuses.
Promptly after execution and delivery of this Agreement, the Company will
either (i) prepare and file a prospectus in accordance with the provisions of
Rule 430A ("Rule 430A") of the rules and regulations of the Commission under
the 1933 Act (the "1933 Act Regulations") and paragraph (b) of Rule 424 ("Rule
424(b)") of the 1933 Act Regulations or (ii) if the Company has elected to rely
upon Rule 434 ("Rule 434") of the 1933 Act Regulations, prepare and file a term
sheet (a "Term Sheet") in accordance with the provisions of Rule 434 and Rule
424(b). Two forms of prospectus are to be used in connection with the offering
and sale of the Securities: one relating to the International Securities (the
"Form of International Prospectus") and one relating to the U.S. Securities
(the "Form of U.S. Prospectus"). The Form of International Prospectus is
identical to the Form of U.S. Prospectus, except for the front cover and back
cover pages and the information under the caption "Underwriting". The
information included in any such prospectus or in any such Term Sheet, as the
case may be, that was omitted from such registration statement at the time it
became effective but that is deemed to be part of such registration statement
at the time it became effective (a) pursuant to paragraph (b) of Rule 430A is
referred to as "Rule 430A Information" or (b) pursuant to paragraph (d) of Rule
434 is referred to as "Rule 434 Information." Each Form of International
Prospectus and Form of U.S. Prospectus used before such registration statement
became effective, and any prospectus that omitted, as applicable, the Rule 430A
Information or the Rule 434 Information, that was used after such effectiveness
and prior to the execution and delivery of this Agreement, is herein called a
"preliminary prospectus." Such registration statement, including the exhibits
thereto and schedules thereto at the time it became effective and including the
Rule 430A Information and the Rule 434 Information, as applicable, is herein
called the "Registration Statement." Any registration statement filed pursuant
to Rule 462(b) of the 1933 Act Regulations is herein referred to as the "Rule
462(b) Registration Statement," and after such filing the term "Registration
Statement" shall include the Rule 462(b) Registration
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Statement. The final Form of International Prospectus and the final Form of
U.S. Prospectus in the forms first furnished to the Underwriters for use in
connection with the offering of the Securities are herein called the
"International Prospectus" and the "U.S. Prospectus," respectively, and
collectively, the "Prospectuses." If Rule 434 is relied on, the terms
"International Prospectus" and "U.S. Prospectus" shall refer to the preliminary
International Prospectus dated May 9, 1997 and preliminary U.S. Prospectus
dated May 9, 1997, respectively, each together with the applicable Term Sheet
and all references in this Agreement to the date of such Prospectuses shall
mean the date of the applicable Term Sheet. For purposes of this Agreement,
all references to the Registration Statement, any preliminary prospectus, the
International Prospectus, the U.S. Prospectus or any Term Sheet or any
amendment or supplement to any of the foregoing shall be deemed to include the
copy filed with the Commission pursuant to its Electronic Data Gathering,
Analysis and Retrieval system ("XXXXX").
SECTION 1. Representations and Warranties.
(a) Representations and Warranties by the Company and Iridium.
Each of the Company and Iridium jointly and severally represents and warrants
to each International Manager as of the date hereof, as of the Closing Time
referred to in Section 2(c) hereof, and as of each Date of Delivery (if any)
referred to in Section 2(b) hereof, and agrees with each International Manager,
as follows:
(i) Compliance with Registration Requirements. Each of the
Registration Statement and any Rule 462(b) Registration Statement has
become effective under the 1933 Act and no stop order suspending the
effectiveness of the Registration Statement or any Rule 462(b)
Registration Statement has been issued under the 1933 Act and no
proceedings for that purpose have been instituted or are pending or,
to the knowledge of the Company or Iridium, are contemplated by the
Commission, and any request on the part of the Commission for
additional information has been complied with.
At the respective times the Registration Statement, any Rule
462(b) Registration Statement and any post-effective amendments
thereto became effective and at the Closing Time (and, if any
International Option Securities are purchased, at the Date of
Delivery), the Registration Statement, the Rule 462(b) Registration
Statement and any amendments and supplements thereto complied and will
comply in all material respects with the requirements of the 1933 Act
and the 1933 Act Regulations and did not and will not contain an
untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements
therein not misleading, and the Prospectuses, any preliminary
prospectuses and any supplement thereto or prospectus wrapper prepared
in connection therewith, at their respective times of issuance and at
the Closing Time, complied and will comply in all material respects
with any applicable laws or regulations of foreign jurisdictions in
which the Prospectuses and such preliminary prospectuses, as amended
or supplemented, if applicable, are distributed in connection with the
offer and sale of Reserved Securities. Neither of the Prospectuses
nor any amendments or supplements thereto (including any prospectus
wrapper), at the time the
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Prospectuses or any amendments or supplements thereto were issued and
at the Closing Time (and, if any International Option Securities are
purchased, at the Date of Delivery), included or will include an
untrue statement of a material fact or omitted or will omit to state a
material fact necessary in order to make the statements therein, in
the light of the circumstances under which they were made, not
misleading. If Rule 434 is used, the Company will comply with the
requirements of Rule 434 and the Prospectuses shall not be "materially
different," as such term is used in Rule 434, from the prospectuses
included in the Registration Statement at the time it became
effective.
Each preliminary prospectus and the prospectuses filed as part
of the Registration Statement as originally filed or as part of any
amendment thereto, or filed pursuant to Rule 424 under the 1933 Act,
complied when so filed in all material respects with the 1933 Act
Regulations and each preliminary prospectus and the Prospectuses
delivered to the Underwriters for use in connection with this offering
was identical in all material respects to the electronically
transmitted copies thereof filed with the Commission pursuant to
XXXXX, except to the extent permitted by Regulation S-T. The
representations and warranties in this subsection (a)(i) shall not
apply to statements in or omissions from the Registration Statement or
the U.S. Prospectus made in reliance upon and in conformity with
information furnished to the Company in writing by any International
Manager through the International Manager expressly for use in the
Registration Statement or the International Prospectus.
(ii) Independent Accountants. The accountants who certified
the financial statement and the consolidated financial statements
included in the Registration Statement are independent public
accountants as required by the 1933 Act and the 1933 Act Regulations.
(iii) Financial Statements. The financial statement and the
consolidated financial statements included in the Registration
Statement and the Prospectuses, together with the related notes,
present fairly the financial position of the Company, Iridium,
Iridium's predecessor and their respective consolidated subsidiaries
at the dates indicated and the statement of operations, stockholders'
equity, members' equity and cash flows of the Company, Iridium,
Iridium's predecessor and their respective consolidated subsidiaries
for the periods specified; said financial statement and the
consolidated financial statements have been prepared in conformity
with generally accepted accounting principles ("GAAP") applied on a
consistent basis throughout the periods involved, except in the case
of the interim financial statements, for the absence of complete
footnote disclosure and customary year-end adjustments. The selected
financial data included in the Prospectuses present fairly the
information shown therein and have been compiled on a basis consistent
with that of the audited financial statement and the consolidated
financial statements included in the Registration Statement.
(iv) No Material Adverse Change in Business. Since the
respective dates as of which information is given in the Registration
Statement and the Prospectuses, except for the matters disclosed in
the Registration Statement, (A) there has been no material
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adverse change in the condition, financial or otherwise, or in the
earnings, business affairs or business prospects of the Company or
Iridium, whether or not arising in the ordinary course of business (a
"Material Adverse Effect"), (B) there have been no transactions
entered into by the Company or Iridium, other than those in the
ordinary course of business, which are material with respect to the
Company or Iridium and (C) except for quarterly, in-kind dividends on
the Series A Class 2 Interests in Iridium (the "Series A Interests")
in amounts per Series A Interest that are consistent with the terms of
the Series A Interests and the Limited Liability Company Agreement of
Iridium LLC, dated as of July 29, 1996, as amended as of the date
hereof (the "LLC Agreement"), there has been no dividend or
distribution of any kind declared, paid or made by the Company on any
class of its capital stock, or Iridium on any class or series of its
limited liability company interests (its "Interests").
(v) Good Standing of the Company and Iridium. The Company
has been duly incorporated and is validly existing as an exempted
company in good standing under the laws of Bermuda and has all
requisite power and authority to conduct its business as described in
the Prospectuses and to enter into and perform its obligations under
this Agreement; and the Company has been duly qualified as a foreign
company to transact business and is in good standing in each other
jurisdiction in which such qualification is required, whether by
reason of the ownership or leasing of property or the conduct of
business, except where the failure so to qualify or to be in good
standing would not result in a Material Adverse Effect.
Iridium has been duly formed and is an existing limited
liability company in good standing under the laws of the State of
Delaware and has all requisite corporate power and authority to own,
lease and operate its properties and to conduct its business as
described in the Prospectuses and to enter into and perform its
obligations under this Agreement; and Iridium has been duly qualified
as a foreign limited liability company to transact business and is in
good standing in each other jurisdiction in which such qualification
is required, whether by reason of the ownership or leasing of property
or the conduct of business, except where the failure so to qualify or
to be in good standing would not result in a Material Adverse Effect.
(vi) No Significant Subsidiary Neither the Company nor
Iridium has any "significant subsidiary" as such term is defined in
Rule 1-02 of Regulation S-X.
(vii) Capitalization. The authorized, issued and outstanding
capital stock of the Company are as set forth in the Prospectuses in
the column entitled "Actual" under the caption "Capitalization--The
Company." The shares of issued and outstanding capital stock of the
Company have been duly authorized and validly issued and are fully
paid and non-assessable; none of the outstanding shares of capital
stock of the Company was issued in violation of the preemptive or
other similar rights of any securityholder of the Company.
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The authorized, issued and outstanding Interests of Iridium
are as set forth in the Prospectuses in the column entitled "Actual"
under the caption "Capitalization--Iridium." The issued and
outstanding Interests of Iridium have been duly authorized and validly
issued and are fully paid and non-assessable (except as disclosed in
the Registration Statement under the captions "Description of Iridium
LLC Limited Liability Company Agreement--Limitations on Liability" and
"Description of Iridium LLC Limited Liability Company
Agreement--Capital Contributions; Reserve Capital Call"); none of the
outstanding Interests of Iridium was issued in violation of the
preemptive or other similar rights of any member of Iridium. Pursuant
to the LLC Agreement, and in accordance with the Delaware Limited
Liability Company Act (the "Delaware Act"), the Company has waived the
limitation on liability contained in the Delaware Act, provided that
the Company has no liability to any person, including Iridium, for any
debt, obligation or liability of Iridium until all of the assets and
capital of Iridium have first been exhausted in satisfaction thereof.
(viii) Authorization of Agreement. This Agreement and the
U.S. Purchase Agreement have been duly authorized, executed and
delivered by each of the Company and Iridium.
(ix) Authorization and Description of Securities. The
Securities to be purchased by the International Managers and the U.S.
Underwriters from the Company have been duly authorized for issuance
and sale to the International Managers pursuant to this Agreement and
the U.S. Underwriters pursuant to the U.S. Purchase Agreement,
respectively, and, when issued and delivered by the Company pursuant
to this Agreement and the U.S. Purchase Agreement, respectively,
against payment of the consideration set forth herein and in the U.S.
Purchase Agreement, respectively, will be validly issued, fully paid
and non-assessable; the Class A Common Stock will conform in all
material respects to the descriptions thereof contained in the
Prospectuses; upon full payment of the consideration therefor no,
holder of the Securities will be subject to personal liability by
reason of being such a holder; and the issuance of the Securities is
not subject to the preemptive or other similar rights of any
securityholder of the Company.
The Class 1 Interests to be purchased by the Company from
Iridium have been duly authorized for issuance and sale to the Company
pursuant to the 1997 Subscription Agreement and, when issued and
delivered by Iridium pursuant to the 1997 Subscription Agreement
against payment of the consideration set forth therein, will be
validly issued, and (except as set forth in Section 2.09 of the LLC
Agreement) fully paid and non-assessable; such Class 1 Interests will
conform in all material respects to the descriptions thereof contained
in the Prospectuses and such descriptions conform to the rights set
forth in the instruments defining the same (except as disclosed in the
Prospectuses under the caption "Description of Iridium LLC Limited
Liability Company Agreement--Limitations on Liability"); except as
described in the Prospectuses under the caption "Description of
Iridium LLC Limited Liability Company Agreement--Limitations on
Liability," no holder of such Class 1 Interests will be subject to
personal liability by reason of being such a holder; and the issuance
of the Class 1 Interests
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pursuant to the 1997 Subscription Agreement is not subject to the
preemptive or other similar rights of any member of Iridium. Pursuant
to the LLC Agreement, and in accordance with the Delaware Act, the
Company has waived the limitation on liability contained in the
Delaware Act, provided that the Company has no liability to any
person, including Iridium, for any debt, obligation or liability of
Iridium until all of the assets and capital of Iridium have first been
exhausted in satisfaction thereof.
(x) Absence of Defaults and Conflicts. Neither the Company
nor Iridium is in violation of its memorandum of association or
bye-laws, certificate of formation or limited liability company
agreement or in default in the performance or observance of any
obligation, agreement, covenant or condition contained in any
contract, indenture, mortgage, deed of trust, loan or credit
agreement, note, lease or other agreement (including the Governance
Agreements) or instrument to which the Company or Iridium is a party
or by which it or any of them may be bound, or to which any of the
property or assets of the Company or Iridium is subject (collectively,
"Agreements and Instruments") except for such defaults that would not
result in a Material Adverse Effect; and the execution, delivery and
performance of this Agreement and the U.S. Purchase Agreement and the
consummation of the transactions contemplated in this Agreement, the
U.S. Purchase Agreement, the Governance Agreements and in the
Registration Statement (including the issuance and sale of the
Securities and the use of the proceeds from the sale of the Securities
as described in the Prospectuses under the caption "Use of Proceeds")
and by the Transactions and compliance by each of the Company and
Iridium with its obligations under this Agreement, the U.S. Purchase
Agreement and the Governance Agreements have been duly authorized by
all necessary corporate action and do not and will not, whether with
or without the giving of notice or passage of time or both, conflict
with or constitute a breach of, or default or Repayment Event (as
defined below) under, or result in the creation or imposition of any
lien, charge or encumbrance upon any property or assets of the Company
or Iridium pursuant to, the Agreements and Instruments (except for
such conflicts, breaches or defaults or liens, charges or encumbrances
that would not result in a Material Adverse Effect), nor will such
action result in any violation of the provisions of the memorandum of
association, bye-laws, certificate of formation or limited liability
company agreement of the Company or Iridium or any applicable law,
statute, rule, regulation, judgment, order, writ or decree of any
government, government instrumentality or court, domestic or foreign,
having jurisdiction over the Company or Iridium or any of their
assets, properties or operations. As used herein, a "Repayment Event"
means any event or condition which gives the holder of any note,
debenture or other evidence of indebtedness (or any person acting on
such holder's behalf) the right to require the repurchase, redemption
or repayment of all or a portion of such indebtedness by the Company
or Iridium.
(xi) Absence of Labor Dispute. No labor dispute with the
employees of the company or Iridium exists or, to the knowledge of the
Company or Iridium, is imminent.
(xii) Absence of Proceedings. Except for matters which are
described in the Registration Statement, there is no action, suit,
proceeding, inquiry or investigation
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before or brought by any court or governmental agency or body,
domestic or foreign, now pending, or, to the knowledge of the Company
or Iridium, threatened, against or affecting the Company or Iridium,
which is required to be disclosed in the Registration Statement, or
which might reasonably be expected to result in a Material Adverse
Effect, or which might reasonably be expected to materially and
adversely affect the properties or assets thereof or the consummation
of the transactions contemplated in this Agreement and the U.S.
Purchase Agreement or the Transactions or the performance, if
determined adversely to the Company or Iridium, of its obligations
hereunder or thereunder; all pending legal or governmental proceedings
to which the Company or Iridium is a party or of which any of their
respective property or assets is the subject which are not described
in the Registration Statement, including ordinary routine litigation
incidental to the business, would not reasonably be expected to result
in a Material Adverse Effect.
(xiii) Accuracy of Exhibits. There are no contracts or
documents which are required to be described in the Registration
Statement or the Prospectuses or to be filed as exhibits thereto which
have not been so described and filed as required.
(xiv) Possession of Intellectual Property. Except as
described in the Registration Statement or as would not have a
Material Adverse Effect, Iridium owns or possesses or reasonably
believes it can acquire on reasonable terms, adequate patents, patent
rights, licenses, inventions, copyrights (including trade secrets and
other unpatented and/or unpatentable proprietary or confidential
information, systems or procedures, but excluding any required
regulatory licenses or approvals), trademarks, service marks, trade
names or other intellectual property (collectively, "Intellectual
Property") or that it can contract on reasonable terms with third
parties who can acquire the Intellectual Property necessary to carry
on the business now operated by Iridium or described in the
Registration Statement, and neither the Company nor Iridium has
received any notice or is otherwise aware of any infringement of or
conflict with asserted rights of others with respect to any
Intellectual Property or of any facts or circumstances which would
render any Intellectual Property invalid or inadequate to protect the
interest of the Company or Iridium, and which infringement or conflict
(if the subject of any unfavorable decision, ruling or finding) or
invalidity or inadequacy, singly or in the aggregate, would result in
a Material Adverse Effect.
(xv) Absence of Further Requirements. No filing with, or
authorization, approval, consent, license, order, registration,
qualification or decree of, any court or governmental authority or
agency is necessary or required for the performance by the Company or
Iridium of its obligations hereunder, in connection with the offering,
issuance or sale of the Securities under this Agreement and the U.S.
Purchase Agreement or the consummation of the transactions
contemplated by this Agreement and the U.S. Purchase Agreement or by
the Transactions except (i) such as have been already obtained or as
may be required under the 1933 Act or the 1933 Act Regulations and
foreign or state securities or blue sky laws and (ii) such as have
been obtained under the laws and regulations of jurisdictions outside
the United States in which the Reserved Securities are offered.
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(xvi) Possession of Licenses and Permits. Except as disclosed
in the Registration Statement or as would not have a Material Adverse
Effect, (i) Iridium possesses such permits, licenses, approvals,
consents and other authorizations (collectively, "Governmental
Licenses") issued by the appropriate federal, state, local or foreign
regulatory agencies or bodies necessary to conduct the business now
operated by Iridium and (ii) Iridium is in compliance with the current
terms and conditions of all such Governmental Licenses, except where
the failure so to comply would not, singly or in the aggregate, have a
Material Adverse Effect; all of the Governmental Licenses are valid
and in full force and effect, except where the invalidity of such
Governmental Licenses or the failure of such Governmental Licenses to
be in full force and effect would not have a Material Adverse Effect;
and neither the Company nor Iridium has received any notice of
proceedings relating to the revocation or modification of any such
Governmental Licenses which, singly or in the aggregate, if the
subject of an unfavorable decision, ruling or finding, would result in
a Material Adverse Effect. This representation does not extend to
Governmental Licenses required for Iridium to conduct its business as
proposed to be conducted, most of which have not been obtained.
(xvii) Title to Property. The Company owns no real property.
Iridum has good and marketable title to all real property it owns; and
the Company and Iridium have good title to all other properties owned
by them, in each case, free and clear of all mortgages, pledges,
liens, security interests, claims, restrictions or encumbrances of any
kind except such as (a) are described in the Registration Statement or
(b) would not, singly or in the aggregate, reasonably be expected to
have a Material Adverse Effect; and all of the leases and subleases
material to the business of the Company and Iridium, considered as one
enterprise, and under which the Company and Iridium hold properties
described in the Prospectuses, are in full force and effect, and
neither the Company nor Iridium has any notice of any material claim
of any sort that has been asserted by anyone adverse to the rights of
the Company or Iridium under any of the leases or subleases mentioned
above, or affecting or questioning the rights of the Company or
Iridium to the continued possession of the leased or subleased
premises under any such lease or sublease except such as would not
reasonably be expected to have a Material Adverse Effect.
(xviii) Compliance with Cuba Act. The Company has complied
with, and is and will be in compliance with, the provisions of that
certain Florida act relating to disclosure of doing business with
Cuba, codified as Section 517.075 of the Florida statutes, and the
rules and regulations thereunder (collectively, the "Cuba Act") or is
exempt therefrom.
(xix) Investment Company Act. The Company believes that it
is not, and upon the issuance and sale of the Securities as herein
contemplated and the application of the net proceeds therefrom as
described in the Prospectuses, will not be, an "investment company" or
an entity "controlled" by an "investment company" as such terms are
defined in the Investment Company Act of 1940, as amended (the "1940
Act").
(xx) Environmental Laws. Except as described in the
Registration Statement and except as would not, singly or in the
aggregate, result in a Material Adverse Effect, (A)
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neither the Company nor Iridium is in violation of any federal, state,
local or foreign statute, law, rule, regulation, ordinance, code,
policy or rule of common law or any judicial or administrative
interpretation thereof, including any judicial or administrative
order, consent, decree or judgment, relating to pollution or
protection of human health, the environment (including, without
limitation, ambient air, surface water, groundwater, land surface or
subsurface strata) or wildlife, including, without limitation, laws
and regulations relating to the release or threatened release of
chemicals, pollutants, contaminants, wastes, toxic substances,
hazardous substances, petroleum or petroleum products (collectively,
"Hazardous Materials") or to the manufacture, processing,
distribution, use, treatment, storage, disposal, transport or handling
of Hazardous Materials (collectively, "Environmental Laws"), (B)
Iridium has all permits, authorizations and approvals required under
any applicable Environmental Laws and is in compliance with its
requirements, (C) there are no pending or threatened administrative,
regulatory or judicial actions, suits, demands, demand letters,
claims, liens, notices of noncompliance or violation, investigation or
proceedings relating to any Environmental Law against Iridium and (D)
there are no events or circumstances that might reasonably be expected
to form the basis of an order for clean-up or remediation, or an
action, suit or proceeding by any private party or governmental body
or agency, against or affecting the Company or Iridium relating to
Hazardous Materials or any Environmental Laws.
(xxi) Registration Rights. There are no persons with
registration rights or other similar rights to have any securities
registered pursuant to the Registration Statement or, except as set
forth in the Registration Statement, otherwise registered by the
Company under the 1933 Act.
(xxii) Principal Agreements. Except as disclosed in the
Registration Statement and except as would not reasonably be expected
to have a Material Adverse Effect, to the best of the Company's and
Iridium's knowledge, none of the parties to (i) the Gateway
Authorization Agreements (as defined in the Prospectuses), (ii) the
Space System Contract (as defined in the Prospectuses), (iii) the
Operations and Maintenance Contract (as defined in the Prospectuses),
(iv) the Iridium Business Support System Contract with Xxxxxxxx
Consulting (the "IBSS Contract"), (v) the Terrestrial Network
Development Contract (as defined in the Prospectus), and (vi) the
Support Agreement between Iridium and Motorola (the "Support
Agreement") (collectively, the foregoing are herein called the
"Principal Agreements"), is in breach of, or in default in the
performance or observance of, any material obligation, term, covenant
or condition contained therein. Each of the Principal Agreements that
the Company has delivered to the International Managers is a true and
correct copy, and there have been no additional amendments,
alterations, modifications or waivers thereto or in the exhibits or
schedules thereto. Iridium has duly and validly authorized, executed
and delivered each of the Principal Agreements to which it is a party
and, to the best of the Company's and Iridium's knowledge, the other
parties to each of the Principal Agreements have duly and validly
executed and delivered each of the Principal Agreements and, assuming
due and valid authorization, execution and delivery by such other
parties, each of the Principal Agreements is a legally valid and
binding agreement of Iridium, enforceable against Iridium in
accordance with its terms,
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subject, as to enforcement, to bankruptcy, insolvency, reorganization
and other laws of general applicability relating to or affecting
creditors' rights and to general equity principles; provided that no
representation or warranty is made with respect to any provision of
such agreement purporting to require indemnification of, or
contribution to, the liability losses, damages or claims of any person
to the extent that such provision may be limited by applicable laws.
(xxiii) Governance Agreements. Neither the Company nor
Iridium, nor to the best knowledge of the Company and Iridium, any
other party to any of the Governance Agreements, is in breach of, or
in default in the performance or observance of, any material
obligation, term, covenant or condition contained in any of the
Governance Agreements. Each of the Governance Agreements that the
Company has delivered to the International Managers is a true and
correct copy, and there have been no additional amendments,
alterations, modifications or waivers thereto or in the exhibits or
schedules thereto. Each of the Company and Iridium has duly and
validly executed and delivered each of the Governance Agreements and,
to the best of the Company's and Iridium's knowledge, the other
parties to each of the Governance Agreements have duly and validly
authorized, executed and delivered each of the Governance Agreements
and, assuming due and valid authorization, execution and delivery by
such other parties, each of the Governance Agreements is a legally
valid and binding agreement of the Company and Iridium, enforceable
against the Company and Iridium in accordance with its terms, subject,
as to enforcement, to bankruptcy, insolvency, reorganization and other
laws of general applicability relating to or affecting creditors'
rights and to general equity principles; provided that no
representation or warranty is made with respect to any provision of
such agreement purporting to require indemnification of, or
contribution to, the liability losses, damages or claims of any person
to the extent that such provision may be limited by applicable laws.
(xxiv) FCC License. The Federal Communications Commission
(the "FCC") has authorized Motorola, Inc. (Motorola, Inc. together
with its subsidiaries, "Motorola") to construct a mobile satellite
system capable of operating in the 1616 to 1626.5 MHz frequency bands,
consistent with the technical specifications set forth in its
application, as modified, the FCC's rules and the conditions set forth
in the FCC's Order and Authorization (DA 95-131, released January 31,
1995, DA 95-372, released February 28, 1995, FCC 96-279, released June
27, 1996, DA 96-1789, released October 30, 1996).
(xxv) Forward Looking Statements. The statements (including
the assumptions described therein) included in the Registration
Statement and the Prospectuses relating to Iridium's operations,
expected markets, size of expected addressable markets for mobile
satellite services, expected technical capabilities, expected funding
needs, expected financing sources, expected pricing, expected launch
schedule, expected commercial operations schedule, the estimate of the
last year in which Iridium will have negative cash flow and a net
increase in year-end borrowings and expected future regulatory
approvals as well as information concerning expected characteristics
of competing systems and expected actions of third parties such as
equipment suppliers, gateway operators, service
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providers and roaming partners were made by the Company with a
reasonable basis and reflect the Company's good faith estimate of the
matters described therein.
(xxvi) Certain Descriptions. The statements set forth in the
Prospectuses under the captions "Governance of the Company and
Relationship with Iridium," "Description of Capital Stock" and
"Description of Iridium LLC Limited Liability Company Agreement,"
insofar as they purport to constitute a summary of the terms of the
Class A Common Stock and the Interests, as the case may be, and to
describe the provisions of the laws and documents referred to therein,
and under the captions "Risk Factors--Risks Associated with Licensing
and Spectrum Allocation," "Risk Factors--Risks Associated with
Principal Supply Contracts," "Principal Contracts for the Development
of the Iridium System," "Certain Relationships and Related
Transactions," "Tax Considerations" and "Underwriting," insofar as
they purport to describe the provisions of the laws and documents
referred to therein, are accurate, complete and fair in all material
respects.
(xxvii) Accounting Controls. The Company and Iridium
maintain a system of internal accounting controls sufficient to
provide reasonable assurances that (A) transactions are executed in
accordance with management's general or specific authorization; (B)
transactions are recorded as necessary to permit preparation of
financial statements in conformity with generally accepted accounting
principles and to maintain accountability for assets; (C) access to
assets is permitted only in accordance with management's general or
specific authorization; and (D) the recorded accountability for
assets is compared with the existing assets at reasonable intervals
and appropriate action is taken with respect to any differences.
(b) Officers' Certificates. Any certificate signed by any officer
of the Company or Iridium delivered to the Global Coordinator, the Lead
Manager(s) or to counsel for the International Managers shall be deemed a
representation and warranty by the Company and Iridium to each International
Manager as to the matters covered thereby but no personal liability therefor
shall attach to the officer providing any such certificate.
SECTION 2. Sale and Delivery to International Managers; Closing.
(a) Initial Securities. On the basis of the representations and
warranties herein contained and subject to the terms and conditions herein set
forth, the Company agrees to sell to each International Manager, severally and
not jointly, and each International Manager, severally and not jointly, agrees
to purchase from the Company, at the price per share set forth in Schedule B,
the number of Initial International Securities set forth in Schedule A opposite
the name of such International Manager, plus any additional number of Initial
International Securities which such International Manager may become obligated
to purchase pursuant to the provisions of Section 11 hereof.
(b) Option Securities. In addition, on the basis of the
representations and warranties herein contained and subject to the terms and
conditions herein set forth, the Company hereby grants an option to the
International Managers, severally and not jointly, to purchase up to an
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additional 300,000 shares of Class A Common Stock at the price per share set
forth in Schedule B, less an amount per share equal to any dividends or
distributions declared by the Company and payable on the Initial International
Securities but not payable on the International Option Securities. The option
hereby granted will expire 30 days after the date hereof and may be exercised
in whole or in part from time to time only for the purpose of covering
over-allotments which may be made in connection with the offering and
distribution of the Initial International Securities upon notice by the Global
Coordinator to the Company and Iridium setting forth the number of
International Option Securities as to which the several International Managers
are then exercising the option and the time and date of payment and delivery
for such International Option Securities. Any such time and date of delivery
for the International Option Securities (a "Date of Delivery") shall be
determined by the Global Coordinator, but shall not be later than seven full
business days after the exercise of said option, nor in any event prior to the
Closing Time, as hereinafter defined. If the option is exercised as to all or
any portion of the International Option Securities, each of the International
Managers, acting severally and not jointly, will purchase that proportion of
the total number of International Option Securities then being purchased which
the number of Initial International Securities set forth in Schedule A opposite
the name of such International Manager bears to the total number of Initial
International Securities, subject in each case to such adjustments as the
Global Coordinator in its discretion shall make to eliminate any sales or
purchases of fractional shares.
(c) Payment. Payment of the purchase price for, and delivery of
certificates for, the Initial Securities shall be made at the offices of
Xxxxxxxx & Xxxxxxxx, 0000 Xxxxxxxxxxxx Xxxxxx, XX, Xxxxxxxxxx, XX, 00000, or at
such other place as shall be agreed upon by the Global Coordinator and the
Company, at 9:00 A.M. (Eastern time) on the third (fourth, if the pricing
occurs after 4:30 P.M. (Eastern time) on any given day) business day after the
date hereof (unless postponed in accordance with the provisions of Section 11),
or such other time not later than ten business days after such date as shall be
agreed upon by the Global Coordinator and the Company (such time and date of
payment and delivery being herein called "Closing Time").
In addition, in the event that any or all of the International Option
Securities are purchased by the International Managers, payment of the purchase
price for, and delivery of certificates for, such International Option
Securities shall be made at the above-mentioned offices, or at such other place
as shall be agreed upon by the Global Coordinator and the Company, on each Date
of Delivery as specified in the notice from the Global Coordinator to the
Company.
Payment shall be made to the Company by wire transfer of immediately
available funds to a bank account designated by the Company, against delivery
to the Lead Manager(s) for the respective accounts of the International
Managers of certificates for the International Securities to be purchased by
them. It is understood that each International Manager has authorized the Lead
Manager(s), for its account, to accept delivery of, receipt for, and make
payment of the purchase price for, the Initial International Securities and the
International Option Securities, if any, which it has agreed to purchase.
Xxxxxxx Xxxxx, individually and not as representative of the International
Managers, may (but shall not be obligated to) make payment of the purchase
price for the Initial International Securities or the International Option
Securities, if any, to be
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purchased by any International Manager whose funds have not been received by
the Closing Time or the relevant Date of Delivery, as the case may be, but such
payment shall not relieve such International Manager from its obligations
hereunder.
(d) Denominations; Registration. Certificates for the Initial
International Securities and the International Option Securities, if any, shall
be in such denominations and registered in such names as the Lead Managers may
request in writing at least one full business day before the Closing Time or
the relevant Date of Delivery, as the case may be. The certificates for the
Initial International Securities and the International Option Securities, if
any, will be made available for examination and packaging by the Lead Managers
in The City of New York not later than 10:00 A.M. (Eastern time) on the
business day prior to Closing Time or the relevant Date of Delivery, as the
case may be.
SECTION 3. Covenants of the Company. The Company covenants with each
International Manager as follows:
(a) Compliance with Securities Regulations and Commission
Requests. The Company, subject to Section 3(b), will comply with the
requirements of Rule 430A or Rule 434, as applicable, and will notify the
Global Coordinator immediately, and confirm the notice in writing, (i) when any
post-effective amendment to the Registration Statement shall become effective,
or any supplement to the Prospectuses or any amended Prospectuses shall have
been filed, (ii) of the receipt of any comments from the Commission, (iii) of
any request by the Commission for any amendment to the Registration Statement
or any amendment or supplement to the Prospectuses or for additional
information, and (iv) of the issuance by the Commission of any stop order
suspending the effectiveness of the Registration Statement or of any order
preventing or suspending the use of any preliminary prospectus, or of the
suspension of the qualification of the Securities for offering or sale in any
jurisdiction, or of the initiation or threatening of any proceedings for any of
such purposes. The Company will promptly effect the filings necessary pursuant
to Rule 424(b) and will take such steps as it deems necessary to ascertain
promptly whether the form of prospectus transmitted for filing under Rule
424(b) was received for filing by the Commission and, in the event that it was
not, it will promptly file such prospectus. The Company will make every
reasonable effort to prevent the issuance of any stop order and, if any stop
order is issued, to obtain the lifting thereof at the earliest possible moment.
(b) Filing of Amendments. The Company will give the Global
Coordinator notice of its intention to file or prepare any amendment to the
Registration Statement (including any filing under Rule 462(b)), any Term Sheet
or any amendment, supplement or revision to either the prospectus included in
the Registration Statement at the time it became effective or to the
Prospectuses, will furnish the Global Coordinator with copies of any such
documents a reasonable amount of time prior to such proposed filing or use, as
the case may be, and will not file or use any such document to which the Global
Coordinator or counsel for the International Managers shall object promptly
after it receives copies thereof.
(c) Delivery of Registration Statements. The Company has
furnished or will deliver to the Lead Manager(s) and counsel for the
International Managers, without charge, signed
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copies of the Registration Statement as originally filed and of each amendment
thereto (including exhibits filed therewith or incorporated by reference
therein) and signed copies of all consents and certificates of experts, and
will also deliver to the Lead Manager(s), without charge, a conformed copy of
the Registration Statement as originally filed and of each amendment thereto
(without exhibits) for each of the International Managers. The copies of the
Registration Statement and each amendment thereto furnished to the
International Managers will be identical in all material respects to the
electronically transmitted copies thereof filed with the Commission pursuant to
XXXXX, except to the extent permitted by Regulation S-T.
(d) Delivery of Prospectuses. Subject to paragraph (e), the
Company has delivered to each International Manager, without charge, as many
copies of each preliminary prospectus as such International Manager reasonably
requested, and the Company hereby consents to the use of such copies for
purposes permitted by the 1933 Act. The Company will furnish to each
International Manager, without charge, during the period when the International
Prospectus is required to be delivered under the 1933 Act or the Securities
Exchange Act of 1934 (the "1934 Act"), such number of copies of the
International Prospectus (as amended or supplemented) as such International
Manager may reasonably request. The International Prospectus and any
amendments or supplements thereto furnished to the International Managers will
be identical in all material respects to the electronically transmitted copies
thereof filed with the Commission pursuant to XXXXX, except to the extent
permitted by Regulation S-T.
(e) Continued Compliance with Securities Laws. The Company will
comply with the 1933 Act and the 1933 Act Regulations so as to permit the
completion of the distribution of the Securities as contemplated in this
Agreement, the U.S. Purchase Agreement and in the Prospectuses. If at any time
during the nine month period immediately following the time of issue of the
U.S. Prospectus a prospectus is required by the 1933 Act to be delivered in
connection with sales of the Securities, any event shall occur or condition
shall exist as a result of which it is necessary, in the opinion of counsel for
the International Managers or for the Company, to amend the Registration
Statement or amend or supplement any Prospectus in order that the Prospectuses
will not include any untrue statements of a material fact or omit to state a
material fact necessary in order to make the statements therein not misleading
in the light of the circumstances existing at the time it is delivered to a
purchaser, or if it shall be necessary, in the opinion of such counsel, at any
such time to amend the Registration Statement or amend or supplement any
Prospectus in order to comply with the requirements of the 1933 Act or the 1933
Act Regulations, the Company will promptly prepare and file with the
Commission, subject to Section 3(b), such amendment or supplement as may be
necessary to correct such statement or omission or to make the Registration
Statement or the Prospectuses comply with such requirements, and the Company
will furnish to the International Managers such number of copies of such
amendment or supplement as the International Managers may reasonably request.
In case any U.S. Underwriter is required to deliver a prospectus in connection
with the sale of U.S. Securities at any time nine months or more after the time
of issue of the U.S. Prospectus, upon request of the U.S. Underwriters but at
the expense of such U.S. Underwriters, the Company agrees to prepare and
deliver to such U.S. Underwriters as many copies as the U.S. Underwriters may
request of an amended or supplemented U.S. Prospectus complying with Section
10(a)(3) of the 1933 Act.
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(f) Blue Sky Qualifications. The Company will use its best
efforts, in cooperation with the International Managers, to qualify the
Securities for offering and sale under the applicable securities laws of such
states and other jurisdictions (domestic or foreign) as the Global Coordinator
may designate and to maintain such qualifications in effect for a period of not
less than one year from the later of the effective date of the Registration
Statement and any Rule 462(b) Registration Statement; provided, however, that
the Company shall not be obligated to file any general consent to service of
process or to qualify as a foreign corporation or as a dealer in securities in
any jurisdiction in which it is not so qualified or to subject itself to
taxation or other governmental fees and charges in respect of doing business in
any jurisdiction in which it is not otherwise so subject. In each jurisdiction
in which the Securities have been so qualified, the Company will file such
statements and reports as may be required by the laws of such jurisdiction to
continue such qualification in effect for a period of not less than one year
from the effective date of the Registration Statement and any Rule 462(b)
Registration Statement.
(g) Rule 158. The Company will timely file such reports pursuant
to the 1934 Act as are necessary in order to make generally available to its
securityholders as soon as practicable an earnings statement for the purposes
of, and to provide the benefits contemplated by, the last paragraph of Section
11(a) of the 1933 Act.
(h) Use of Proceeds. The Company will use the net proceeds
received by it from the sale of the Securities in the manner specified in the
Prospectuses under "Use of Proceeds". The Company shall take such steps as
shall be necessary to ensure that the Company shall not become an "investment
company" within the meaning of such term under the 1940 Act and the rules and
regulations thereunder; provided that the Company is not able to control the
occurrence of a "Company Change in Control" or "Reduction in Interest," as such
terms are defined in the LLC Agreement, and the related consequences under the
1940 Act.
(i) Listing. The Company will use its best efforts to effect and
maintain the quotation of the Securities on the Nasdaq National Market and will
file with the Nasdaq National Market all documents and notices required by the
Nasdaq National Market of companies that have securities that are traded in the
over-the-counter market and quotations for which are reported by the Nasdaq
National Market.
(j) Restriction on Sale of Securities. During a period of 180
days from the date of the Prospectuses, the Company will not, without the prior
written consent of the Global Coordinator, (i) directly or indirectly, offer,
pledge, sell, contract to sell, sell any option or contract to purchase,
purchase any option or contract to sell, grant any option, right or warrant to
purchase or otherwise transfer or dispose of any share of Class A Common Stock
or any securities convertible into or exercisable or exchangeable for Class A
Common Stock or file any registration statement under the 1933 Act with respect
to any of the foregoing or (ii) enter into any swap or any other agreement or
any transaction that transfers, in whole or in part, directly or indirectly,
the economic consequence of ownership of the Class A Common Stock, whether any
such swap or transaction described in clause (i) or (ii) above is to be settled
by delivery of Class A Common Stock or such other securities, in cash or
otherwise. The foregoing sentence shall not apply to the Securities to be sold
hereunder or under the U.S. Purchase Agreement, the
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Company's Global Ownership Program or the Iridium LLC Share Option Plan, each
as described in the Prospectuses. In addition, the foregoing restriction shall
not apply to the issuance of warrants to purchase shares of Iridium Class A
Common Stock in connection with any offering of debt securities of Iridium or
any of its subsidiaries provided, that (i) such warrants have a per share
exercise price not lower than the market price of the Class A Common Stock on
the date the warrants are issued and (ii) such warrants are not exercisable
earlier than 180 days from the date of their issuance.
(k) Reporting Requirements. The Company, during the period when
the Prospectuses are required to be delivered under the 1933 Act or the 1934
Act, will file all documents required to be filed with the Commission pursuant
to the 1934 Act within the time periods required by the 1934 Act and the rules
and regulations of the Commission thereunder.
(l) Compliance with NASD Rules. The Company hereby agrees that it
will ensure that the Reserved Securities will be restricted as required by the
National Association of Securities Dealers, Inc. (the "NASD") or the NASD rules
from sale, transfer, assignment, pledge or hypothecation for a period of three
months following the date of this Agreement. The Underwriters will notify the
Company as to which persons will need to be so restricted. At the request of
the Underwriters, the Company will direct the transfer agent to place a stop
transfer restriction upon such securities for such period of time. Should the
Company release, or seek to release, from such restrictions any of the Reserved
Securities, the Company agrees to reimburse the Underwriters for any reasonable
expenses (including, without limitation, legal expenses) they incur in
connection with such release.
(m) Compliance with Rule 463. The Company will file with the
Commission such reports on Form SR as may be required pursuant to Rule 463 of
the 1933 Act Regulations.
(n) Exchange Agreement. During a period of 180 days from the date
of the Prospectuses, the Company will not enter into any amendment to, or waive
the application of any provision of, the Exchange Agreement or take any action
that would have any effect similar to the foregoing, in each case if the effect
thereof is to permit exchanges of Class 1 Interests for Class A Stock during
such 180-day period.
SECTION 4. Covenants of Iridium. Iridium covenants and agrees
with each International Manager as follows:
(a) Exchange Agreement. During a period of 180 days from the date
of the Prospectuses, Iridium will not enter into any amendment to, or waive the
application of any provision of, the Exchange Agreement or take any action that
would have any effect similar to the foregoing.
(b) Use of Proceeds. Iridium shall apply the proceeds of the sale
of its Class 1 Interests to the Company substantially as set forth in the
Prospectuses.
SECTION 5. Payment of Expenses. (a) Expenses. Iridium will pay all
expenses incident to the performance of the obligations of Iridium and the
Company under this Agreement, including (i) the preparation, printing and
filing of the Registration Statement
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(including financial statements and exhibits) as originally filed and of each
amendment thereto, (ii) the preparation, printing and delivery to the
Underwriters of this Agreement, any Agreement among Underwriters and such other
documents as may be required in connection with the offering, purchase, sale,
issuance or delivery of the Securities, (iii) the preparation, issuance and
delivery of the certificates for the Securities to the Underwriters, including
any stock or other transfer taxes and any stamp or other duties payable upon
the sale, issuance or delivery of the Securities to the Underwriters and the
transfer of the Securities between the U.S. Underwriters and the International
Managers, (iv) the fees and disbursements of the Company's and Iridium's
counsel, accountants and other advisors, (v) the qualification of the
Securities under securities laws in accordance with the provisions of Section
3(f) hereof, including filing fees and the reasonable fees and disbursements of
counsel for the Underwriters in connection therewith and in connection with the
preparation of the Blue Sky Survey and any supplement thereto, (vi) the
printing and delivery to the Underwriters of copies of each preliminary
prospectus, any Term Sheets and of the Prospectuses and any amendments or
supplements thereto, (vii) the preparation, printing and delivery to the
Underwriters of copies of the Blue Sky Survey and any supplement thereto,
(viii) the fees and expenses of any transfer agent or registrar for the
Securities, (ix) the filing fees incident to, and the reasonable fees and
disbursements of counsel to the Underwriters in connection with, the review by
the National Association of Securities Dealers, Inc. (the "NASD") of the terms
of the sale of the Securities, (x) the fees and expenses incurred in connection
with the inclusion of the Securities in the Nasdaq National Market and (xi) all
costs and expenses of the Underwriters, including the fees and disbursements of
counsel for the Underwriters, in connection with matters related to the
Reserved Securities which are designated by Iridium for sale to employees and
others having a business relationship with Iridium. It is understood, however,
that except as provided in this Section, Section 7 and Section 8, the
International Managers will pay all of their own costs and expenses, including
the fees and expenses of their counsel, transfer taxes on resale of any of the
securities and any advertising expenses connected with any offers they make.
(b) Termination of Agreement. If this Agreement is terminated
by the Lead Managers in accordance with the provisions of Section 6 or Section
10(a)(i) hereof, Iridium shall reimburse the International Managers for all of
their reasonable out-of-pocket expenses, including the reasonable fees and
disbursements of counsel for the International Managers.
SECTION 6. Conditions of International Managers' Obligations. The
obligations of the several International Managers hereunder are subject to the
accuracy of the representations and warranties of the Company and Iridium
contained in Section 1 hereof or in certificates of any officer of the Company
or Iridium delivered pursuant to the provisions hereof, to the performance by
the Company of its covenants and other obligations hereunder, and to the
following further conditions:
(a) Effectiveness of Registration Statement. The Registration
Statement, including any Rule 462(b) Registration Statement, has become
effective and at Closing Time no stop order suspending the effectiveness of the
Registration Statement shall have been issued under the 1933 Act or proceedings
therefor initiated or threatened by the Commission, and any request on the part
of the Commission for additional information shall have been complied with to
the
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reasonable satisfaction of counsel to the International Managers. A prospectus
containing the Rule 430A Information shall have been filed with the Commission
in accordance with Rule 424(b) (or a post-effective amendment providing such
information shall have been filed and declared effective in accordance with the
requirements of Rule 430A) or, if the Company has elected to rely upon Rule
434, a Term Sheet shall have been filed with the Commission in accordance with
Rule 424(b).
(b) Letter and Opinion of Counsel for the Company and Iridium. At
Closing Time, the Lead Managers shall have received the favorable opinion and
letter, dated as of Closing Time, of Xxxxxxxx & Xxxxxxxx, counsel for the
Company and Iridium, in form and substance satisfactory to counsel for the
International Managers, together with signed or reproduced copies of such
letters for each of the other International Managers to the effect set forth in
Exhibit A-1 hereto.
(c) Opinion of Bermuda Counsel for the Company. At Closing Time,
the Lead Managers shall have received the favorable opinion, dated as of
Closing Time, of Xxxxxxx Xxxx & Xxxxxxx, Bermuda counsel for the Company, in
form and substance satisfactory to counsel for the International Managers,
together with signed or reproduced copies of such letter for each of the other
International Managers to the effect set forth in Exhibit A-2 hereto.
(d) Opinion of Regulatory Counsel for Motorola. At Closing Time,
the Lead Managers shall have received the favorable opinion, dated as of
Closing Time, of Steptoe & Xxxxxxx LLP, regulatory counsel for Motorola
Satellite Communications, Inc. as FCC license holder, in form and substance
satisfactory to counsel for the International Managers, together with signed or
reproduced copies of such letter for each of the other International Managers
to the effect set forth in Exhibit A-3 hereto.
(e) Opinion of Assistant Secretary of the Company and General
Counsel of Iridium. At Closing Time, the Lead Managers shall have received the
favorable opinion, dated as of Closing Time, of F. Xxxxxx Xxxxxx, Esq.,
Assistant Secretary of the Company and General Counsel of Iridium, in form and
substance satisfactory to counsel for the International Managers, together with
signed or reproduced copies of such letter for each of the other International
Managers to the effect set forth in Exhibit A-4 hereto.
(f) Opinion of Counsel for International Managers. At Closing
Time, the Lead Managers shall have received the favorable opinion, dated as of
Closing Time, of Fried, Frank, Harris, Xxxxxxx & Xxxxxxxx, counsel for the
International Managers, together with signed or reproduced copies of such
letter for each of the other International Managers with respect to the matters
set forth in clauses (i) and (iv) and certain portions of the penultimate
paragraph of Exhibit A-1 hereto. In giving such opinion such counsel may rely,
as to all matters governed by the laws of jurisdictions other than the law of
the State of New York and the federal law of the United States and the Delaware
Act, upon the opinions of counsel satisfactory to the Lead Managers. Such
counsel may also state that, insofar as such opinion involves factual matters,
they have relied, to the extent they deem proper, upon certificates of officers
of the Company and Iridium and certificates of public officials.
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(g) Opinion of Regulatory Counsel for the International Managers.
At Closing Time, the Lead Managers shall have received the favorable opinion,
dated as of Closing Time, of Goldberg, Godles, Wiener & Xxxxxx, regulatory
counsel for the International Managers together with signed or reproduced
copies of such letter for each of the other International Managers to such
effect as the International Managers may reasonably request.
(h) Officers' Certificates. At Closing Time, there shall not have
been, since the date hereof or since the respective dates as of which
information is given in the Prospectuses, any material adverse change in the
condition, financial or otherwise, or in the earnings, business affairs or
business prospects of the Company or Iridium, whether or not arising in the
ordinary course of business, and the Lead Managers shall have received a
certificate of the President or a Vice President of each of the Company and
Iridium and of the chief financial or chief accounting officer of each of the
Company and Iridium, dated as of Closing Time, to the effect that (i) there has
been no such material adverse change, (ii) the representations and warranties
in Section 1(a) hereof are true and correct with the same force and effect as
though expressly made at and as of Closing Time, (iii) the Company or Iridium,
as the case may be, has complied with all agreements and satisfied all
conditions on its part to be performed or satisfied at or prior to Closing
Time, and (iv) no stop order suspending the effectiveness of the Registration
Statement has been issued and no proceedings for that purpose have been
instituted or are pending or are contemplated by the Commission.
(i) Accountant's Comfort Letter. At the time of the execution of
this Agreement, the Lead Managers shall have received from KPMG Peat Marwick
LLP a letter dated such date, in form and substance satisfactory to the Lead
Managers, together with signed or reproduced copies of such letter for each of
the other International Managers containing statements and information of the
type ordinarily included in accountants' "comfort letters" to underwriters with
respect to the financial statements and certain financial information contained
in the Registration Statement and the Prospectuses.
(j) Bring-down Comfort Letter. At Closing Time, the Lead Managers
shall have received from KPMG Peat Marwick LLP a letter, dated as of Closing
Time, to the effect that they reaffirm the statements made in the letter
furnished pursuant to subsection (i) of this Section (updated to include the
final Prospectuses), except that the specified date referred to shall be a date
not more than three business days prior to Closing Time.
(k) Approval of Listing. At Closing Time, the Securities shall
have been approved for inclusion in the Nasdaq National Market, subject only to
official notice of issuance.
(l) No Objection. At or prior to Closing Time, the NASD shall
have confirmed that it has not raised any objection with respect to the
fairness and reasonableness of the underwriting terms and arrangements.
(m) Motorola Certificate. At Closing Time, the Lead Managers
shall have received a certificate, dated as of Closing Time, of the President
or a Vice President of Motorola, Inc., in form and substance satisfactory to
counsel for the International Managers, as to the accuracy of the statements
attributed to Motorola in the Prospectuses, and to such other matters relating
to
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Motorola as counsel for the International Managers may reasonably request (a
draft of such certificate is attached as Exhibit B hereto).
(n) Purchase of Initial U.S. Securities. Contemporaneously with
the purchase by the International Managers of the Initial International
Securities under this Agreement, the U.S. Underwriters shall have purchased the
Initial U.S. Securities under the U.S. Purchase Agreement.
(o) Conditions to Purchase of International Option Securities. In
the event that the International Managers exercise their option provided in
Section 2(b) hereof to purchase all or any portion of the International Option
Securities, the representations and warranties of the Company and Iridium
contained herein and the statements in any certificates furnished by the
Company or Iridium hereunder shall be true and correct as of each Date of
Delivery and, at the relevant Date of Delivery, the Lead Managers shall have
received:
(i) Officers' Certificates. A certificate, dated such Date
of Delivery, of the President or a Vice President of each of
the Company and Iridium and of the chief financial or chief
accounting officer of each of the Company and Iridium
confirming that the certificate or certificates delivered at
Closing Time pursuant to Section 6(h) hereof remain true and
correct as of such Date of Delivery.
(ii) Opinion of Counsel for the Company and Iridium. The
favorable opinion of each of Xxxxxxxx & Xxxxxxxx, counsel for
the Company and Iridium, Xxxxxxx Xxxx & Xxxxxxx, Bermuda
counsel for the Company, Steptoe & Xxxxxxx LLP, regulatory
counsel for Motorola Satellite Communications, Inc. as FCC
license holder, and F. Xxxxxx Xxxxxx, Assistant Secretary of
the Company and General Counsel of Iridium, each in form and
substance satisfactory to counsel for the International
Managers, dated such Date of Delivery, relating to the
International Option Securities to be purchased on such Date
of Delivery and otherwise to the same effect as the opinions
required by Sections 6(b), 6(c), 6(d) and 6(e) hereof,
respectively.
(iii) Opinion of Counsel for International Managers. The
favorable opinion of each of Fried, Frank, Harris, Xxxxxxx &
Xxxxxxxx, counsel for the International Managers and Goldberg,
Godles, Wiener & Xxxxxx, regulatory counsel for the
International Managers, each dated such Date of Delivery,
relating to the International Option Securities to be
purchased on such Date of Delivery and otherwise to the same
effect as the opinions required by Sections 6(f) and 6(g)
hereof, respectively.
(iv) Bring-down Comfort Letter. A letter from KPMG Peat
Marwick LLP, in form and substance satisfactory to the Lead
Managers and dated such Date of Delivery, substantially in the
same form and substance as the letter furnished to the Lead
Managers pursuant to Section 6(j) hereof, except that the
"specified date" in the letter furnished pursuant to this
paragraph shall be a date not more than five days prior to
such Date of Delivery.
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(v) Motorola Certificate. A certificate, dated such Date
of Delivery, of the president or a vice president of Motorola,
Inc. confirming that the certificate delivered at Closing Time
pursuant to 6(m) hereof remains true and correct as of such
Date of Delivery.
(p) Transactions. At or prior to Closing Time, the Transactions
shall have been duly and validly effected and all corporate proceedings and
legal matters incident to the Transactions shall be satisfactory to counsel for
the International Managers.
(q) Additional Documents. At Closing Time and at each Date of
Delivery counsel for the International Managers shall have been furnished with
such documents and opinions as they may require for the purpose of enabling
them to pass upon the issuance and sale of the Securities as herein
contemplated, or in order to evidence the accuracy of any of the
representations or warranties, or the fulfillment of any of the conditions,
herein contained.
(r) Termination of Agreement. If any condition specified in this
Section shall not have been fulfilled when and as required to be fulfilled,
this Agreement, or, in the case of any condition to the purchase of
International Option Securities on a Date of Delivery which is after the
Closing Time, the obligations of the several International Managers to purchase
the relevant Option Securities may be terminated by the Lead Managers by notice
to the Company at any time at or prior to Closing Time or such Date of
Delivery, as the case may be, and such termination shall be without liability
of any party to any other party except as provided in Section 4 and except that
Sections 1, 6, 7 and 8 shall survive any such termination and remain in full
force and effect.
(s) Lock-up Agreements. At the date of this Agreement, the Lead
Managers shall have received an agreement substantially in the form of Exhibit
C hereto signed by each of the persons specified on Schedule C hereto.
SECTION 7. Indemnification.
(a) Indemnification of International Managers. Each of the
Company and Iridium agrees to indemnify and hold harmless each International
Manager and each person, if any, who controls any International Manager within
the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act as
follows:
(i) against any and all loss, liability, claim, damage
and expense whatsoever, as incurred, arising out of any untrue
statement or alleged untrue statement of a material fact contained in
the Registration Statement (or any amendment thereto), including the
Rule 430A Information and the Rule 434 Information, if applicable, or
the omission or alleged omission therefrom of a material fact required
to be stated therein or necessary to make the statements therein not
misleading or arising out of any untrue statement or alleged untrue
statement of a material fact included in any preliminary prospectus or
the Prospectuses (or any amendment or supplement thereto), or the
omission or alleged omission therefrom of a material fact necessary in
order to make the statements therein, in the light of the
circumstances under which they were made, not misleading;
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(ii) against any and all loss, liability, claim, damage
and expense whatsoever, as incurred, arising out of (A) the violation
of any applicable laws or regulations of foreign jurisdictions where
Reserved Securities have been offered and (B) any untrue statement or
alleged untrue statement of a material fact included in the supplement
or prospectus wrapper material distributed in Argentina, Brazil,
Canada, Hong Kong, Indonesia, Japan, Korea, the United Kingdom and
Venezuela in connection with the reservation and sale of the Reserved
Securities to eligible employees of the Company and Iridium and
persons having business relationships with Iridium or the omission or
alleged omission therefrom of a material fact necessary to make the
statements therein, when considered in conjunction with the
Prospectuses or preliminary prospectuses, not misleading; (iii)
against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, to the extent of the aggregate amount paid in
settlement of any litigation, or any investigation or proceeding by
any governmental agency or body, commenced or threatened, or of any
claim whatsoever based upon any such untrue statement or omission, or
any such alleged untrue statement or omission or in connection with
any violation of the nature referred to in Section 7(a)(ii)(A) hereof;
provided that (subject to Section 7(d) below) any such settlement is
effected with the written consent of the Company and Iridium; and
(iii) against any and all expense whatsoever, as incurred
(including subject to Section 7(c) hereof the reasonable fees and
disbursements of counsel chosen by Xxxxxxx Xxxxx), reasonably incurred
in investigating, preparing or defending against any litigation, or
any investigation or proceeding by any governmental agency or body,
commenced or threatened, or any claim whatsoever based upon any such
untrue statement or omission, or any such alleged untrue statement or
omission or in connection with any violation of the nature referred to
in Section 7(a)(ii)(A) hereof, to the extent that any such expense is
not paid under (i), (ii) or (iii) above;
provided, however, that this indemnity agreement shall not apply to any loss,
liability, claim, damage or expense to the extent arising out of any untrue
statement or omission or alleged untrue statement or omission made in reliance
upon and in conformity with written information furnished to the Company by any
International Manager through the Lead Managers expressly for use in the
Registration Statement (or any amendment thereto), including the Rule 430A
Information and the Rule 434 Information, if applicable, or any preliminary
prospectus or the International Prospectus (or any amendment or supplement
thereto) and provided, further, that neither Iridium nor the Company will be
liable to an International Manager with respect to any preliminary prospectus
to the extent that Iridium or the Company shall sustain the burden of proving
that any such loss, liability, claim, damage or expense resulted from the fact
that such International Manager in contravention of a requirement of this
Agreement or applicable law, sold Securities to a person to whom such
International Manager failed to send or give, at or prior to Closing Time, a
copy of the International Prospectus as then amended or supplemented if the
Company has previously furnished copies thereof (sufficiently in advance of
Closing Time to allow for distribution by Closing Time) to the International
Manager and the loss, liability, claim, damage or expense of such International
Manager resulted from an untrue statement or omission or alleged untrue
statement or omission of a material fact contained in or omitted from
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the preliminary prospectus which was corrected in the International Prospectus
as, if applicable, amended or supplemented prior to Closing Time.
(b) Indemnification of Company, Iridium, Directors and Officers.
Each International Manager severally agrees to indemnify and hold harmless the
Company and Iridium, their directors, each of their officers who signed the
Registration Statement, and each person, if any, who controls the Company or
Iridium within the meaning of Section 15 of the 1933 Act or Section 20 of the
1934 Act against any and all loss, liability, claim, damage and expense
described in the indemnity contained in subsection (a) of this Section, as
incurred, but only with respect to untrue statements or omissions, or alleged
untrue statements or omissions, made in the Registration Statement (or any
amendment thereto), including the Rule 430A Information and the Rule 434
Information, if applicable, or any preliminary international prospectus or the
International Prospectus (or any amendment or supplement thereto) in reliance
upon and in conformity with written information furnished to the Company by
such International Manager through the Lead Managers expressly for use in the
Registration Statement (or any amendment thereto) or such preliminary
prospectus or the International Prospectus (or any amendment or supplement
thereto).
(c) Actions against Parties; Notification. Each indemnified party
shall give notice as promptly as reasonably practicable to each indemnifying
party of any action commenced against it in respect of which indemnity may be
sought hereunder, but failure to so notify an indemnifying party shall not
relieve such indemnifying party from any liability hereunder to the extent it
is not materially prejudiced as a result thereof and in any event shall not
relieve it from any liability which it may have otherwise than on account of
this indemnity agreement. In the case of parties indemnified pursuant to
Section 7(a) above, counsel to the indemnified parties shall be selected by
Xxxxxxx Xxxxx, and, in the case of parties indemnified pursuant to Section 7(b)
above, counsel to the indemnified parties shall be selected by the Company and
Iridium. An indemnifying party may participate at its own expense in the
defense of any such action; provided, however, that counsel to the indemnifying
party shall not (except with the consent of the indemnified party) also be
counsel to the indemnified party. In no event shall the indemnifying parties
be liable for fees and expenses of more than one counsel (in addition to any
local counsel) separate from their own counsel for all indemnified parties in
connection with any one action or separate but similar or related actions in
the same jurisdiction arising out of the same general allegations or
circumstances. No indemnifying party shall, without the prior written consent
of the indemnified parties, settle or compromise or consent to the entry of any
judgment with respect to any litigation, or any investigation or proceeding by
any governmental agency or body, commenced or threatened, or any claim
whatsoever in respect of which indemnification or contribution could be sought
under this Section 7 or Section 8 hereof (whether or not the indemnified
parties are actual or potential parties thereto), unless such settlement,
compromise or consent (i) includes an unconditional release of each indemnified
party from all liability arising out of such litigation, investigation,
proceeding or claim and (ii) does not include a statement as to or an admission
of fault, culpability or a failure to act by or on behalf of any indemnified
party.
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(d) Settlement without Consent if Failure to Reimburse. If at any
time an indemnified party shall have requested an indemnifying party to
reimburse the indemnified party for fees and expenses of counsel, such
indemnifying party agrees that it shall be liable for any settlement of the
nature contemplated by Section 7(a)(ii) or Section 7(a)(iii) effected without
its written consent if (i) such settlement is entered into more than 45 days
after receipt by such indemnifying party of the aforesaid request, (ii) such
indemnifying party shall have received notice of the terms of such settlement
at least 30 days prior to such settlement being entered into and (iii) such
indemnifying party shall not have reimbursed such indemnified party in
accordance with such request prior to the date of such settlement.
(e) Indemnification for Reserved Securities. In connection with
the offer and sale of the Reserved Securities, each of the Company and Iridium
jointly and severally agrees, promptly upon a request in writing, to indemnify
and hold harmless the Underwriters from and against any and all losses,
liabilities, claims, damages and expenses incurred by them as a result of (i)
the failure of eligible employees of the Company and Iridium and persons having
business relationships with Iridium to pay for and accept delivery of Reserved
Securities following the effectiveness of the Registration Statement, were
subject to a properly confirmed agreement to purchase and (ii) the violation of
any securities laws of foreign jurisdictions in connection with any offer
and/or sale of Reserved Securities (including, without limitation, all
regulations governing Xxxxxxx Xxxxx in its capacity as "authorized person"
under the Financial Services Act in the United Kingdom).
SECTION 8. Contribution. If the indemnification provided for in
Section 7 hereof is for any reason unavailable to or insufficient to hold
harmless an indemnified party in respect of any losses, liabilities, claims,
damages or expenses referred to therein, then each indemnifying party shall
contribute to the aggregate amount of such losses, liabilities, claims, damages
and expenses incurred by such indemnified party, as incurred, (i) in such
proportion as is appropriate to reflect the relative benefits received by the
Company and Iridium on the one hand and the International Managers on the other
hand from the offering of the Securities pursuant to this Agreement or (ii) if
the allocation provided by clause (i) is not permitted by applicable law, in
such proportion as is appropriate to reflect not only the relative benefits
referred to in clause (i) above but also the relative fault of the Company and
Iridium on the one hand and of the International Managers on the other hand in
connection with the statements or omissions, or in connection with any
violation of the nature referred to in Section 7(a)(ii)(A) hereof, which
resulted in such losses, liabilities, claims, damages or expenses, as well as
any other relevant equitable considerations.
The relative benefits received by the Company and Iridium on the one
hand and the International Managers on the other hand in connection with the
offering of the International Securities pursuant to this Agreement shall be
deemed to be in the same respective proportions as the total net proceeds from
the offering of the International Securities pursuant to this Agreement (before
deducting expenses) received by the Company and the total underwriting discount
received by the International Managers, in each case as set forth on the cover
of the International Prospectus, or, if Rule 434 is used, the corresponding
location on the Term Sheet, bear to the aggregate initial public offering price
of the International Securities as set forth on such cover.
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The relative fault of the Company and Iridium on the one hand and the
International Managers on the other hand shall be determined by reference to,
among other things, whether any such untrue or alleged untrue statement of a
material fact or omission or alleged omission to state a material fact relates
to information supplied by the Company and Iridium or by the International
Managers and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission or any violation
of the nature referred to in Section 7(a)(ii)(A) hereof.
The Company, Iridium and the International Managers agree that it
would not be just and equitable if contribution pursuant to this Section 8 were
determined by pro rata allocation (even if the International Managers were
treated as one entity for such purpose) or by any other method of allocation
which does not take account of the equitable considerations referred to above
in this Section 8. The aggregate amount of losses, liabilities, claims,
damages and expenses incurred by an indemnified party and referred to above in
this Section 8 shall be deemed to include any legal or other expenses
reasonably incurred by such indemnified party in investigating, preparing or
defending against any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or any claim whatsoever
based upon any such untrue or alleged untrue statement or omission or alleged
omission.
Notwithstanding the provisions of this Section 8, no International
Manager shall be required to contribute any amount in excess of the amount by
which the total price at which the International Securities underwritten by it
and distributed to the public were offered to the public exceeds the amount of
any damages which such International Managers has otherwise been required to
pay by reason of any such untrue or alleged untrue statement or omission or
alleged omission.
No person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the 0000 Xxx) shall be entitled to contribution from any
person who was not guilty of such fraudulent misrepresentation.
For purposes of this Section 8, each person, if any, who controls an
International Managers within the meaning of Section 15 of the 1933 Act or
Section 20 of the 1934 Act shall have the same rights to contribution as such
International Manager, and each director of the Company or Iridium, each
officer of the Company or Iridium who signed the Registration Statement, and
each person, if any, who controls the Company or Iridium within the meaning of
Section 15 of the 1933 Act or Section 20 of the 1934 Act shall have the same
rights to contribution as the Company. The International Managers' respective
obligations to contribute pursuant to this Section 8 are several in proportion
to the number of Initial International Securities set forth opposite their
respective names in Schedule A hereto and not joint.
SECTION 9. Representations, Warranties and Agreements to Survive
Delivery. All representations, warranties and agreements contained in this
Agreement or in certificates of officers of the Company or Iridium submitted
pursuant hereto, shall remain operative and in full force and effect,
regardless of any investigation made by or on behalf of any International
-27-
32
Manager or controlling person, or by or on behalf of the Company or Iridium,
and shall survive delivery of the Securities to the International Managers.
SECTION 10. Termination of Agreement.
(a) Termination; General. The Lead Managers may terminate this
Agreement, by notice to the Company, at any time at or prior to Closing Time
(i) if there has been, since the time of execution of this Agreement or since
the respective dates as of which information is given in the International
Prospectus, any material adverse change in the condition, financial or
otherwise, or in the earnings, business affairs or business prospects of the
Company and Iridium considered as one enterprise, whether or not arising in the
ordinary course of business, or (ii) if there has occurred any material adverse
change in the financial markets in the United States or the international
financial markets, any outbreak of hostilities or escalation thereof or other
calamity or crisis or any change or development involving a prospective change
in national or international political, financial or economic conditions, in
each case the effect of which is such as to make it, in the judgment of the
Lead Managers, impracticable to market the Securities or to enforce contracts
for the sale of the Securities, or (iii) if trading in any securities of the
Company has been suspended or materially limited by the Commission or the
Nasdaq National Market or Bermuda, or if trading generally on the American
Stock Exchange or the New York Stock Exchange or in the Nasdaq National Market
has been suspended or materially limited, or minimum or maximum prices for
trading have been fixed, or maximum ranges for prices have been required, by
any of said exchanges or by such system or by order of the Commission, the
National Association of Securities Dealers, Inc. or any other governmental
authority, or (iv) if a banking moratorium has been declared by either Federal
or New York authorities.
(b) Liabilities. If this Agreement is terminated pursuant to this
Section, such termination shall be without liability of any party to any other
party except as provided in Section 5 hereof, and provided further that
Sections 1, 7, 8 and 9 shall survive such termination and remain in full force
and effect.
SECTION 11. Default by One or More of the International Managers. If
one or more of the International Managers shall fail at Closing Time or a Date
of Delivery to purchase the Securities which it or they are obligated to
purchase under this Agreement (the "Defaulted Securities"), the Lead Managers
shall have the right, within 24 hours thereafter, to make arrangements for one
or more of the non-defaulting International Managers, or any other
underwriters, to purchase all, but not less than all, of the Defaulted
Securities in such amounts as may be agreed upon and upon the terms herein set
forth; if, however, the Lead Managers shall not have completed such
arrangements within such 24-hour period, then:
(a) if the number of Defaulted Securities does not exceed 10% of
the number of International Securities to be purchased on such date, each of
the non-defaulting International Managers shall be obligated, severally and not
jointly, to purchase the full amount thereof in the proportions that their
respective underwriting obligations hereunder bear to the underwriting
obligations of all non-defaulting International Managers, or
-28-
33
(b) if the number of Defaulted Securities exceeds 10% of the
number of International Securities to be purchased on such date, this Agreement
or, with respect to any Date of Delivery which occurs after the Closing Time,
the obligation of the International Managers to purchase and of the Company to
sell the Option Securities to be purchased and sold on such Date of Delivery
shall terminate without liability on the part of any non-defaulting
International Manager.
No action taken pursuant to this Section shall relieve any defaulting
International Manager from liability in respect of its default.
In the event of any such default which does not result in a
termination of this Agreement or, in the case of a Date of Delivery which is
after the Closing Time, which does not result in a termination of the
obligation of the International Managers to purchase and the Company to sell
the relevant International Option Securities, as the case may be, either the
Lead Managers or the Company shall have the right to postpone Closing Time or
the relevant Date of Delivery, as the case may be, for a period not exceeding
seven days in order to effect any required changes in the Registration
Statement or Prospectus or in any other documents or arrangements. As used
herein, the term "International Manager" includes any person substituted for an
International Manager under this Section 11.
SECTION 12. Notices. All notices and other communications hereunder
shall be in writing and shall be deemed to have been duly given if mailed or
transmitted by any standard form of telecommunication. Notices to the
International Managers shall be directed to the Lead Managers at North Tower,
World Financial Center, New York, New York 10281-1201, attention of
_____________; notices to the Company shall be directed to it at Xxxxxxxxx
Xxxxx, 0 Xxxxxx Xxxxxx, Xxxxxxxx XX 11, Bermuda, attention of the Secretary
(with a copy to Iridium); and notices to Iridium shall be directed to it at
0000 Xxx Xxxxxx, X.X., Xxxxxxxxxx X.X. 00000, attention of General Counsel.
SECTION 13. Parties. This Agreement shall each inure to the benefit
of and be binding upon the International Managers, the Company and Iridium and
their respective successors. Nothing expressed or mentioned in this Agreement
is intended or shall be construed to give any person, firm or corporation,
other than the International Managers, the Company and Iridium and their
respective successors and the controlling persons and officers and directors
referred to in Sections 7 and 8 and their heirs and legal representatives, any
legal or equitable right, remedy or claim under or in respect of this Agreement
or any provision herein contained. This Agreement and all conditions and
provisions hereof are intended to be for the sole and exclusive benefit of the
International Managers, the Company and Iridium and their respective
successors, and said controlling persons and officers and directors and their
heirs and legal representatives, and for the benefit of no other person, firm
or corporation. No purchaser of Securities from any International Manager
shall be deemed to be a successor by reason merely of such purchase.
SECTION 14. GOVERNING LAW AND TIME. THIS AGREEMENT SHALL BE GOVERNED
BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF XXX
-00-
00
XXXXX XX XXX XXXX. SPECIFIED TIMES OF DAY REFER TO NEW YORK CITY TIME.
SECTION 15. Effect of Headings. The Article and Section headings
herein and the Table of Contents are for convenience only and shall not affect
the construction hereof.
-30-
35
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to the Company a counterpart hereof,
whereupon this instrument, along with all counterparts, will become a binding
agreement between the International Managers and the Company in accordance with
its terms.
Very truly yours,
IRIDIUM WORLD COMMUNICATIONS
LTD.
By
-------------------------------------
Name:
Title:
IRIDIUM LLC
By
-------------------------------------
Name:
Title:
CONFIRMED AND ACCEPTED,
as of the date first above written:
XXXXXXX XXXXX INTERNATIONAL
XXXXXXXXX, LUFKIN & XXXXXXXX SECURITIES CORPORATION
XXXXXXX SACHS INTERNATIONAL
By: XXXXXXX XXXXX INTERNATIONAL
By
------------------------------------------------------------------
Authorized Signatory
For themselves and as Lead Managers of the
other International Managers named in Schedule A hereto.
-31-
36
SCHEDULE A
Number of
Initial
International
Name of International Manager Securities
----------------------------- ----------
Xxxxxxx Xxxxx International. . . . . . . . . . . . . . . . . . . . . . . . . . .
Xxxxxxxxx, Lufkin & Xxxxxxxx Securities Corporation. . . . . . . . . . . . . . .
Xxxxxxx Sachs International. . . . . . . . . . . . . . . . . . . . . . . . . . .
-----------------
Total. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,000,000
=================
A-1
37
SCHEDULE B
Iridium World Communications Ltd.
2,000,000 Shares of Class A Common Stock
(Par Value $.01 Per Share)
1. The initial public offering price per share for the
Securities, determined as provided in said Section 2, shall be
$____________.
2. The purchase price per share for the International
Securities to be paid by the several International Managers shall be
$____________, being an amount equal to the initial public offering
price set forth above less $____________ per share; provided that the
purchase price per share for any International Option Securities
purchased upon the exercise of the over-allotment option described in
Section 2(b) shall be reduced by an amount per share equal to any
dividends or distributions declared by the Company and payable on the
Initial International Securities but not payable on the International
Option Securities.
A-2
38
SCHEDULE C
List of persons and entities
subject to lock-up
Xxxxxx X. Xxxxxx
Xxxxxx X. Xxxxxxx
Xxx Xxxxxxx
A-1
39
Exhibit A-1
FORM OF OPINION OF COMPANY'S AND IRIDIUM'S COUNSEL
TO BE DELIVERED PURSUANT TO
SECTION 6(b)
(i) Iridium has been duly formed and is an existing limited liability
company in good standing under the laws of the State of Delaware, with all
requisite limited liability company power and authority to own its properties
and to conduct its business as described in the Prospectuses and to enter into
and perform its obligations under the U.S. Purchase Agreement, the
International Purchase Agreement and the 1997 Governance Agreements.
(ii) Iridium has been duly qualified as a foreign limited liability
company to transact business and is in good standing under the laws of each
jurisdiction set forth in an officer's certificate delivered to you on the
Closing Date specifying the jurisdictions in which Iridium owns or leases
properties or conducts any business (such counsel shall have no responsibility
for the matters set forth in such officer's certificate and such counsel shall
be entitled to rely in respect of the opinion in this clause upon opinions of
local counsel and in respect of matters of fact upon certificates of officers
of Iridium).
(iii) The LLC Agreement provides for the issuance of up to 250,000,000
Class 1 Interests, 50,000 Series M Class 2 Interests and 300,000 additional
Class 2 Interests, of which ______, ______ and ______ have been authorized for
issuance. The outstanding limited liability company interests of Iridium (i)
are shown as outstanding under "Actual" in the Prospectus under the caption
"Capitalization-Iridium" (ii) have been duly authorized and validly issued and
are fully paid and non-assessable.
(iv) The U.S. Purchase Agreement and the International Purchase
Agreement have been duly authorized, executed and delivered by Iridium.
(v) All regulatory consents, authorizations, approvals and filings
required to be obtained or made by the Company or Iridium under the Federal
laws of the United States, the laws of the State of New York and the Limited
Liability Company Act of the State of Delaware for the issuance, sale and
delivery of the Securities by the Company to the Underwriters have been
obtained or made; provided, however, that, for purposes of this clause (v),
such counsel shall express no opinion with respect to Federal or state
communications laws.
(vi) The execution, delivery and performance of the U.S. Purchase
Agreement, the International Purchase Agreement, the 1997 Subscription
Agreement and the consummation of the transactions herein and therein
contemplated (including the issuance and sale of the Securities, and the use of
the proceeds from the sale of the Securities as described in the Prospectuses
under the caption "Use Of Proceeds") do not and will not (i) violate, conflict
with or result in a breach or violation of any of the terms or provisions of,
or consitute a default under, the Principal Agreements nor will such action
result in
A-1
40
any violation of the provisions of the certificate of formation or limited
liability company agreement of Iridium or (ii) violate any Federal law of the
United States or the laws of the State of New York or the Limited Liability
Company Act of the State of Delaware, in each case applicable to Iridium;
provided, however, that, for purposes of this paragraph (vi), such counsel
shall express no opinion with respect to Federal or state securities laws,
other antifraud laws, fraudulent transfer laws or communications laws;
provided, further, that such counsel shall express no opinion as to bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium and similar laws of
general applicability relating to or affecting creditors' rights or with
respect to any provision of such agreements purporting to require
indemnification of, or contribution to, the losses, damages, claims, expenses
or liability of any person.
(vii) The Company is not, and upon the issuance and sale of the
Securities as contemplated in the Purchase Agreements and the application of
the net proceeds therefrom as described in the Prospectuses will not be, an
"investment company" as such term is defined in the 1940 Act.
Such counsel shall also furnish you with a letter to the effect that as
counsel to the Company and Iridium, they reviewed the Registration Statement
and the Prospectuses, participated in discussions with representatives of the
Underwriters, the Company, Iridium and their accountants, Motorola and the
Company's Bermuda counsel and advised the Company and Iridium as to the
requirements of the 1933 Act and the applicable rules and regulations
thereunder; between the effectiveness of the registration statement and Closing
Time, such counsel participated in further discussions with representatives of
the Underwriters, the Company, Iridium and their accountants, and Motorola, in
which the contents of certain portions of the Prospectuses and related matters
were discussed, and reviewed certain documents filed by the Company with the
Commission, certificates of certain officers of the Company, an opinion
addressed to the Underwriters from Steptoe & Xxxxxxx and a letter from the
Company's and Iridium's independent accountants; on the basis of the
information that such counsel gained in the course of the performance of the
services referred to above, considered in the light of such counsel's
understanding of the applicable law and the experience such counsel has gained
through their practice under the 1933 Act, such counsel will confirm to you
that in such counsel's opinion, the Registration Statement, as of its effective
date, and the Prospectuses, as of the date of the Prospectuses, appeared on
their face to be appropriately responsive in all material respects to the
requirements of the 1933 Act and the 1933 Act Regulations; further, nothing
that came to such counsel's attention in the course of such review has caused
such counsel to believe that the Registration Statement, as of its effective
date, and the Prospectuses, as of such effective date, contained any untrue
statement of a material fact or omitted to state any material fact required to
be stated therein or necessary to make the statements therein not misleading;
or that the Prospectuses, as of the date of the Prospectuses contained any
untrue statement of a material fact or omitted to state any material fact
necessary in order to make the statements therein, in light of the
circumstances under which they were made not misleading; also, nothing that has
come to such counsel's attention in the course of the
A-2
41
procedures described in the second clause of this paragraph has caused
such counsel to believe that the Prospectuses, as of the Closing Time,
contained any untrue statement of a material fact or omitted to state any
material fact necessary in order to make the statements therein in the light of
the circumstances under which they were made, not misleading; in addition, such
counsel shall state that such counsel does not know of any litigation or any
governmental proceeding instituted or threatened against the Company or Iridium
that would be required to be disclosed in the Prospectuses and is not so
disclosed and that such counsel does not know of any documents that would be
required to be filed as exhibits to the Registration Statement and are not so
filed or of any documents that are required to be summarized in the
Prospectuses and are not so summarized; such counsel shall state that the
limitations inherent in the independent verification of factual matters and the
character of determinations involved in the registration process are such,
however, that such counsel does not assume any responsibility for the accuracy,
completeness or fairness of the statements contained in the Registration
Statement or the Prospectuses except for those made under the captions "Risk
Factors - Risks Associated with Principal Supply Contracts," "Risk Factors -
Risk of Loss of Management Rights Upon Change of Control," "Risk Factors -
Risks Related to the Investment Company Act of 1940," "Risk Factors - Tax
Consequences Related to Passive Foreign Investment Companies," "Principal
Contracts for the Development of the Iridium System," "Governance of the
Company and Relationship with Iridium," "Description of Iridium LLC Limited
Liability Company Agreement" and "Tax Considerations," in the Prospectuses
insofar as they relate to provisions of law or documents therein described;
also, such counsel need express no opinion or belief as to (i) the financial
statements or other financial data contained in the Registration Statement or
the Prospectuses (including any financial projections) and (ii) the description
of statutes, regulations, proceedings or matters referred to in Section 6(d) of
the Purchase Agreement.
In rendering such opinion and letter, such counsel shall state that they
express no opinion as to the laws of any jurisdiction other than the Federal
laws of the United States, the laws of the State of New York and the Limited
Liability Company Act of the State of Delaware. In rendering such opinion,
such counsel may (A) rely as to matters involving the application of the laws
of Bermuda, upon the opinion of Xxxxxxx Xxxx & Xxxxxxx, Bermuda counsel to the
Company (which opinion shall be dated and furnished to the U.S. Representatives
at Closing Time, shall be satisfactory in form and substance to counsel for the
U.S. Underwriters and shall expressly state that the U.S. Underwriters may rely
on such opinion as if it were addressed to them), provided that Xxxxxxxx &
Xxxxxxxx shall state in their opinion that they believe that they and the U.S.
Underwriters are justified in relying upon such opinion, and (B) rely as to
matters of fact (but not as to legal conclusions), to the extent they deem
proper, on information obtained from public officials or certificates of
responsible officers of Iridium and the Company and other sources believed by
such counsel to be responsible and (C) assume that the signatures on all
documents examined by such counsel are genuine (which assumption such counsel
need not independently verify).
A-3
42
Exhibit A-2
FORM OF OPINION OF COMPANY'S BERMUDA
COUNSEL TO BE DELIVERED PURSUANT TO
SECTION 6(c)
(i) The Company has been duly incorporated and is validly existing as
an exempted company under the laws of Bermuda and is in good standing (meaning
that it has not failed to make any required filing with any Bermuda
governmental authority or to pay any Bermuda government fee or tax the failure
of which might make it liable to be struck off the Register of Companies and
thereby cease to exist under the laws of Bermuda) under the laws of Bermuda.
(ii) The Company has all requisite corporate power and authority
necessary to own or hold its respective properties and conduct its business as
described in the Registration Statement and the Prospectuses.
(iii) Based solely upon the Certified Register, the minutes, resolutions,
memorandum of association and bye-laws of the Company which we have examined,
the authorized capitalisation of the Company as of [ ] 1997 is as set forth
in the column entitled "Actual" under "Capitalization-the Company" in the
Prospectus and all shares of the Company's issued and outstanding Common Stock
requiring authorization for issuance by the Company's Board of Directors have
been duly authorised and, to such counsel's knowledge after due inquiry, are
validly issued, fully paid and non-assessable (which term when used herein
shall mean no further sums are required to be paid by the holders thereof in
connection with the issue of such shares) and conform as to legal matters to
the description thereof contained in the Prospectus.
(iv) The shares of Common Stock to be purchased by the U.S. and the
International Managers from the Company pursuant to the Purchase Agreements,
and the shares of Common Stock issuable upon exercise of options granted to the
U.S. Underwriters and the International Managers to cover over-allotments, if
any, have been duly authorised for issuance and sale and upon issuance and
delivery by the Company in accordance with the terms of such Purchase Agreement
against payment in full of the consideration set forth in such Purchase
Agreements will be duly and validly issued, fully paid and non-assessable and
will not be issued in violation of the preemptive rights of any shareholders of
the Company.
(v) The Company has the necessary corporate power and authority to
enter into and perform its obligations under the Documents. The execution and
delivery of the Documents and the performance of the obligations therein set
forth and the consummation of the transactions therein contemplated, will not
result in a breach or violation of, or constitute a default under the
Memorandum of Association, or Bye-laws
A-4
43
or any of the other Documents, or in violation of any material order, rule,
regulation, writ, injunction, or decree of any government, governmental
instrumentality or court in Bermuda the effect of any which breach, violation
or default would have a material adverse effect on the Company.
(vi) The Company has taken all corporate action required to authorise
its execution and delivery of the Documents and the performance of its
obligations under the Documents in accordance with their respective terms. The
Documents have been duly and validly authorised and executed by or on behalf of
the Company and each constitutes the legal, valid and binding obligations of
the Company enforceable against it in accordance with its respective terms and
upon delivery will be duly and validly delivered.
(vii) To the best of our knowledge, no order, consent, approval, licence,
authorisation or validation of or exemption by any government or public body or
authority of Bermuda or any sub-division thereof is required to authorise or is
required in connection with the execution and delivery by the Company of the
Documents, the performance and enforcement of its obligations thereunder or the
conduct of its business as described in the Prospectus except that permission
of the Bermuda Monetary Authority is required to the issue of the shares of
Common Stock and such permission has been obtained. The issuance and sale of
the shares of the Common Stock is in compliance with all applicable
requirements in Bermuda.
(vii) It is not necessary or advisable, in order to ensure their
enforceability in Bermuda, that the Documents be registered in any register
kept by, or filed with, any governmental authority or regulatory body in
Bermuda.
(viii) The Share Certificates evidencing the shares of Common Stock are in
valid and proper legal form and conform with the requirements of Bermuda law.
(x) Based solely on a search of the Cause Book of the Supreme Court of
Bermuda conducted at 10:00 am on [ ], 1997 there are no pending or
threatened legal or governmental proceedings to which the Company is a party
which could materially adversely affect the business, property, financial
condition or operations of the Company, or which question the validly of the
shares of Common Stock, the Documents, or of any action taken or to be taken by
the Company pursuant to the Documents; and no such proceedings are known to us
to be contemplated against the Company.
(xi) The statements in the Registration Statement under the caption
"Risk Factors-Risk Associated with Incorporation under Bermuda law" and
"Description of Capital Stocks" have been reviewed by us and insofar as they
refer to descriptions of agreements, statements of law, descriptions of
statutes, licences, rules or regulations or legal conclusions of Bermuda, are
correct in all material respects.
A-5
44
Exhibit A-3
FORM OF OPINION OF REGULATORY COUNSEL TO
MOTOROLA SATELLITE COMMUNICATIONS, INC. AS FCC
LICENSE HOLDER TO BE DELIVERED PURSUANT TO
SECTION 6(d)
(i) The information in the Prospectuses under "Risk Factors--Risks
Associated with Licensing and Spectrum Allocation" and "Regulation of Iridium,"
accurately summarize in all material respects the status of all material FCC
licenses, permits, approvals and other FCC authorizations granted to Motorola
Satellite Communications, Inc. with respect to the provision of satellite
services via the IRIDIUM System in the United States as described therein.
(ii) To the best of such counsel's knowledge, Motorola Satellite
Communications, Inc.: (a) is in substantial compliance with the Communications
Act of 1934, as amended, and the rules and regulations of the FCC promulgated
thereunder as they relate to the FCC licenses, permits, approvals and
authorizations referred to in clause (i) above, and (b) has made all material
filings, reports, applications and submissions required thereunder as they
relate to the FCC licenses, permits, approvals and authorizations referred to
in clause (i) above, except as indicated in the Registration Statement, which
filings, reports, applications and submissions, to the best of such counsel's
knowledge, are true, complete and correct in all material respects.
(iii) No consent, approval, authorization or order of the FCC is required
to be obtained by Motorola Satellite Communications, Inc. in connection with
the authorization, issuance, sale or delivery of the Securities by Iridium.
(iv) Nothing has come to such counsel's attention that has caused such
counsel to believe that the descriptions relating solely to the allocation of
spectrum in the United States and to the licensing of the Iridium System in the
United States contained under the captions "Regulation of Iridium" and "Risk
Factors--Risks Associated with Licensing and Spectrum Allocation" of the
Registration Statement, contain any untrue statements of a material fact or
omit to state a material fact necessary to make such descriptions not
misleading.
(v) The FCC has authorized Motorola Satellite Communications, Inc. to
construct a mobile satellite system capable of operating in the 1616-1626.5 MHz
frequency bands, consistent with the technical specifications set forth in its
application, as modified, the FCC's rules (unless specifically waived) and the
conditions set forth in the FCC's Order and Authorization (DA 95-131), released
January 31, 1995, erratum (DA 95-372, released February 28, 1995), as affirmed
by FCC 96-279, released June 27, 1996; Order and Authorization (DA 96-1789),
released October 30, 1996; provided, however, that such authorizations are
subject to modification, stay or revocation through appeals or reconsideration
within the FCC or the courts.
A-6
45
Exhibit A-4
FORM OF OPINION OF ASSISTANT SECRETARY
OF THE COMPANY AND GENERAL COUNSEL OF IRIDIUM
TO BE DELIVERED PURSUANT TO
SECTION 6(e)
(i) Except as described in the Prospectuses, the Company has not
granted any outstanding options, warrants or commitments with respect to any
shares of the capital stock of the Company, whether issued or unissued; except
as described in the Prospectuses, Iridium has not granted any warrants, rights
or options with respect to the limited liability company interests of Iridium.
(ii) The Governance Agreements have been duly authorized, executed and
delivered by Iridium.
(iii) To the best of my knowledge, Iridium is not in violation of its
Certificate of Formation or Limited Liability Company Agreement and no default
by Iridium exists in the due performance or observance of any material
obligation, agreement, covenant or condition contained in any contract,
indenture, mortgage, loan agreement, note, lease or other agreement or
instrument that is described or referred to in the Registration Statement or
the Prospectuses or filed or incorporated by reference as an exhibit to the
Registration Statement.
(iv) The execution, delivery and performance of the U.S. Purchase
Agreement, the International Purchase Agreement, the 1997 Subscription
Agreement and the consummation of the transactions herein and therein
contemplated (including the issuance and sale of the Securities, and the use of
the proceeds from the sale of the Securities as described in the Prospectuses
under the caption "Use Of Proceeds") do not and will not, whether with or
without the giving of notice or lapse of time or both, conflict with or
constitute a breach of, or default or Repayment Event (as defined in Section
1(a)(x) of the Purchase Agreements) under any contract, indenture, mortgage,
deed of trust, loan or credit agreement, any other agreement or instrument,
known to such counsel, to which the Company or Iridium is a party or by which
it or any of them may be bound, or to which any of the property or assets of
the Company or Iridium is subject (except for such conflicts, breaches or
defaults or liens, charges or encumbrances that would not have a Material
Adverse Effect).
(v) Except as described in the Registration Statement, there are no
persons with registration rights or other similar rights to have any securities
registered pursuant to the Registration Statement or otherwise registered by
Iridium under the 1933 Act.
(vi) Iridium has duly and validly authorized, executed and delivered
each of the Principal Agreements to which it is a party and, assuming due
authorization,
A-7
46
execution and delivery by the other parties to the Principal Agreements, each
of the Principal Agreements is a legally valid and binding agreement of the
Company, enforceable against the Company in accordance with its terms, subject,
as to enforcement, to bankruptcy, insolvency, reorganization and other laws of
general applicability relating to or affecting creditors' rights and to general
equity principles or with respect to any provision of such agreements
purporting to require indemnification of, or contribution to, the losses,
damages, claims, expenses or liability of any person.
(vii) Each of the Company and Iridium has duly and validly authorized,
executed and delivered each of the Governance Agreements and, assuming due
authorization, execution and delivery by the other parties to the Governance
Agreements, each of the Governance Agreements is a legally valid and binding
agreement of the Company and Iridium, enforceable against the Company and
Iridium in accordance with its terms, subject, as to enforcement, to
bankruptcy, insolvency, reorganization and other laws of general applicability
relating to or affecting creditors' rights and to general equity principles.
(viii) Except as disclosed in the Registration Statement, to the best of
my knowledge, there is not pending or threatened any action, suit, proceeding,
inquiry or investigation, to which the Company or Iridium is a party, or to
which the property of the Company or Iridium is subject, before or brought by
any court or governmental agency or body, domestic or foreign, which might
reasonably be expected to result in a Material Adverse Effect, or which might
reasonably be expected to materially and adversely affect the properties or
assets thereof or the consummation of the transactions contemplated in the U.S.
Purchase Agreement, the International Purchase Agreement or the 1997
Subscription Agreement or the performance by the Company or Iridium of their
obligations thereunder or the consummation of the Transactions.
In rendering such opinion, such counsel shall state that such counsel
expresses no opinion as to the laws of any jurisdiction other than the Federal
laws of the United States and the Limited Liability Company Act of the State of
Delaware. In rendering such opinion, such counsel may rely (A) as to matters
involving the application of the laws of Bermuda, upon the opinion of Xxxxxxx
Xxxx & Xxxxxxx, Bermuda counsel to the Company (which opinion shall be dated
and furnished to the U.S. Representatives at Closing Time, shall be
satisfactory in form and substance to counsel for the U.S. Underwriters and
shall expressly state that the U.S. Underwriters may rely on such opinion as
if it were addressed to them), and (B), as to matters of fact (but not as to
legal conclusions), to the extent he deems proper, on information obtained from
public officials or certificates of responsible officers of Iridium and the
Company and other sources believed by such counsel to be responsible and (C)
assume that the signatures on all documents examined by such counsel (other
than those of officers or directors of Iridium or the Company) are genuine
(which assumption such counsel need not independently verify).
A-8
47
Exhibit C
____________ , 1997
XXXXXXX XXXXX & CO.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
Xxxxxxxxx, Lufkin & Xxxxxxxx
Securities Corporation
Xxxxxxx, Sachs & Co.
as U.S. Representatives of the several
U.S. Underwriters to be named in the
within-mentioned U.S. Purchase Agreement
x/x Xxxxxxx Xxxxx & Xx.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated(1)
Xxxxx Xxxxx
Xxxxx Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
XXXXXXX XXXXX INTERNATIONAL
Xxxxxxxxx, Lufkin & Xxxxxxxx
Securities Corporation
Xxxxxxx Sachs International
as Lead Manager(s) of the several International Managers
c/o Merrill Xxxxx International
00 Xxxxxxxxxx Xxxx
Xxxxxx XXXX 0XX
Xxxxxxx
Re: Proposed Public Offering by Iridium World Communications Ltd.
Dear Sirs:
The undersigned, a stockholder of Iridium World Communications Ltd, a
Bermuda company (the "Company"), understands that Xxxxxxx Xxxxx & Co., Xxxxxxx
Lynch, Pierce, Xxxxxx & Xxxxx Incorporated ("Xxxxxxx Xxxxx"), Dondaldson,
Lufkin & Xxxxxxxx Securities Corporation and Xxxxxxx, Sachs & Co. propose to
enter into a U.S. Purchase Agreement (the "U.S. Purchase Agreement") with the
Company providing for the public offering of shares (the "Securities") of the
Company's Class A common stock, par value $.01 per share (the "Class A Common
Stock"). In recognition of the benefit that such an offering will confer upon
the undersigned as a stockholder of the Company, and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the undersigned agrees with each underwriter to be named in the
U.S. Purchase Agreement that, during a period of 180 days from the date of the
U.S. Purchase Agreement, the undersigned will not, without the prior written
consent of Merrill
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48
Xxxxx, directly or indirectly, (i) offer, pledge, sell, contract to sell, sell
any option or contract to purchase, purchase any option or contract to sell,
grant any option, right or warrant for the sale of, or otherwise dispose of or
transfer any shares of the Company's Class A Common Stock or any securities
convertible into or exchangeable or exercisable for Class A Common Stock,
whether now owned or hereafter acquired by the undersigned or with respect to
which the undersigned has or hereafter acquires the power of disposition, or
file any registration statement under the Securities Act of 1933, as amended,
with respect to any of the foregoing or (ii) enter into any swap or any other
agreement or any transaction that transfers, in whole or in part, directly or
indirectly, the economic consequence of ownership of the Class A Common Stock,
whether any such swap or transaction is to be settled by delivery of Class A
Common Stock or other securities, in cash or otherwise.
Very truly yours,
Signature:
------------------------------
Print Name:
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C-2
