FORM OF INVESTMENT AGREEMENT BY AND AMONG GLOBALSTAR, L.P., THE OFFICIAL COMMITTEE OF UNSECURED CREDITORS OF GLOBALSTAR, L.P. AND NEW VALLEY CORPORATION DATED AS OF January __, 2003
Exhibit 99.3
FORM OF
BY AND AMONG
GLOBALSTAR, L.P.,
THE OFFICIAL COMMITTEE OF UNSECURED
CREDITORS OF GLOBALSTAR, L.P.
AND
NEW VALLEY CORPORATION
DATED AS OF
January __, 2003
TABLE OF CONTENTS
I. | SHARE PURCHASE | 2 | ||||||
1.1 | Share Purchase |
2 | ||||||
1.2 | Cash Purchase Price |
2 | ||||||
1.3 | Closing |
2 | ||||||
1.4 | Cash Closing Deliveries |
2 | ||||||
1.5 | Exemption from Registration |
2 | ||||||
II. | REPRESENTATIONS AND WARRANTIES OF THE PARTNERSHIP | 3 | ||||||
2.1 | Existence; Authorization, Validity and Effect of Agreement |
3 | ||||||
2.2 | Capitalization |
4 | ||||||
2.3 | Ownership of Subsidiaries |
4 | ||||||
2.4 | Validity of Shares, Etc |
4 | ||||||
2.5 | No Conflict; Required Filings and Consents |
5 | ||||||
2.6 | SEC Documents |
5 | ||||||
2.7 | No Brokers |
6 | ||||||
2.8 | Intellectual Property |
6 | ||||||
2.9 | Management Presentation Material |
6 | ||||||
2.10 | Bring-Down of Bankruptcy Disclosure Schedules |
6 | ||||||
2.11 | Scope of Partnership Representations |
7 | ||||||
III. | REPRESENTATIONS AND WARRANTIES OF NEW VALLEY | 7 | ||||||
3.1 | Existence; Authorization, Validity and Effect of Agreement |
7 | ||||||
3.2 | No Conflict; Required Filings and Consents |
7 | ||||||
3.3 | No Brokers |
7 | ||||||
3.4 | Sufficient Funds |
8 | ||||||
3.5 | Investment Intent |
8 | ||||||
3.6 | Investor Sophistication; Etc |
8 | ||||||
3.7 | Ownership of Securities |
8 | ||||||
3.8 | Access to Information |
8 | ||||||
3.9 | Forecasts and Projections |
8 | ||||||
IV. | COVENANTS | 8 | ||||||
4.1 | Inspection of Records |
8 | ||||||
4.2 | Confidentiality |
8 | ||||||
4.3 | Publicity |
9 | ||||||
4.4 | Further Action |
9 | ||||||
4.5 | Filings with Governmental Entities |
9 |
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TABLE OF CONTENTS
(continued)
Page | ||||||||
4.6 | No Solicitations |
9 | ||||||
4.7 | Conduct of Business |
10 | ||||||
4.8 | Exchange Act Registration; Securities Exchange Listing |
11 | ||||||
4.9 | Right to Participate in First Public Offering |
12 | ||||||
4.10 | Interim Operations of New Globalstar |
12 | ||||||
4.11 | Voting Agreement |
12 | ||||||
V. | CONDITIONS TO CLOSING | 12 | ||||||
5.1 | Conditions to Each Party’s Obligations |
12 | ||||||
5.2 | Conditions to Obligations of the Partnership |
13 | ||||||
5.3 | Conditions to Obligations of New Valley |
13 | ||||||
VI. | NO SURVIVAL | 14 | ||||||
VII. | TERMINATION | 14 | ||||||
7.1 | Termination by Mutual Consent |
14 | ||||||
7.2 | Termination by Either Party |
14 | ||||||
7.3 | Effect of Termination |
16 | ||||||
7.4 | Termination Payment |
16 | ||||||
VIII. | GENERAL PROVISIONS | 17 | ||||||
8.1 | Notices |
17 | ||||||
8.2 | Assignment; Binding Effect |
18 | ||||||
8.3 | Entire Agreement |
18 | ||||||
8.4 | Amendment |
18 | ||||||
8.5 | Governing Law |
19 | ||||||
8.6 | Counterparts |
19 | ||||||
8.7 | Headings |
19 | ||||||
8.8 | Certain Definitions/Interpretations |
19 | ||||||
8.9 | Waivers |
24 | ||||||
8.10 | Jurisdiction; Consent to Service of Process |
24 | ||||||
8.11 | Waiver of Jury Trial |
25 | ||||||
8.12 | No Strict Construction |
25 |
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TABLE OF EXHIBITS
Exhibit A |
— | Form of First Amended Chapter 11 Plan of Reorganization | ||||||
Exhibit B |
— | Form of Disclosure Statement | ||||||
Exhibit C |
— | Form of Certificate of Designation | ||||||
Exhibit D |
— | Form of Warrant Agreement (Series A Warrants) | ||||||
Exhibit E |
— | Form of Warrant Agreement (Series B Warrants) | ||||||
Exhibit F |
— | Form of Certificate of Incorporation | ||||||
Exhibit G |
— | Form of Bylaws | ||||||
Exhibit H |
— | Form of Voting Agreement |
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This INVESTMENT AGREEMENT (this “Agreement”) is dated as of January , 2003, by and among Globalstar, L.P., a Delaware limited partnership (the “Partnership”), the Official Committee of Unsecured Creditors of Globalstar, L.P. (the “Creditors Committee”) (solely with respect to Sections 4.3, 4.4, 4.5(a), 4.6 and 8.4) and New Valley Corporation, a Delaware corporation (“New Valley”). Capitalized terms used but not defined elsewhere in the text of this Agreement are defined in Section 8.8 hereof.
I. SHARE PURCHASE
1.1 Share Purchase. On the terms and subject to the conditions set forth in this Agreement, at the Closing:
(a) in accordance with the Confirmed Chapter 11 Plan, all Claims in respect of the DIP Facility shall be satisfied in full by the delivery to New Valley of a number of shares of Common Stock equal to the quotient (rounded to the nearest whole number) obtained by dividing (i) the principal outstanding under the Term Loan Notes, together with interest accrued thereon through the Closing Date (and not otherwise capitalized in the PIK Interest Note), and the principal outstanding under the PIK Interest Note together with interest accrued thereon through the Closing Date (and not otherwise capitalized in the PIK Interest Note) (the “DIP Facility Pay-Off Amount”), by (ii) $10.00; and
(b) New Globalstar will issue and sell to New Valley, and New Valley will purchase from New Globalstar, a number of shares of Common Stock equal to the quotient (rounded to the nearest whole number) obtained by dividing (i) $55,000,000 less the DIP Facility Pay-Off Amount (the “Cash Purchase Price”) by (ii) $10.00.
Shares of Common Stock issued pursuant to this Section 1.1 are referred to herein as the “Purchased Shares.”
1.2 Cash Purchase Price. As consideration for the issuance to it of the Purchased Shares in accordance with Section 1.1(b), on the Closing Date, New Valley will pay New Globalstar in cash the Cash Purchase Price. The Cash Purchase Price shall be paid by New Valley by wire transfer of immediately available funds to an account of New Globalstar designated by the Partnership by written notice to New Valley delivered at least two Business Days prior to the Closing Date.
1.3 Closing. The closing of the transactions contemplated by Section 1.1 (the “Closing”) will take place at the offices of Xxxxx Day, 000 X. 00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx at 10:00 a.m. local time on the date on which all of the conditions (other than the conditions to be satisfied concurrently with the Closing) set forth in Article V have been satisfied or waived (or such other date, time and place to which the parties to this Agreement may agree in writing), provided the Closing shall occur on the Effective Date. The date on which the Closing occurs is referred to herein as the “Closing Date.”
1.4 Cash Closing Deliveries. (a) At or prior to the Closing, New Valley will deliver to New Globalstar (i) the Cash Purchase Price payable by New Valley in accordance with Section 1.2 and (ii) the certificate required by Section 5.2(d).
(b) At or prior to the Closing, (i) New Globalstar will deliver to New Valley one or more validly issued stock certificates evidencing the Purchased Shares and (ii) the Partnership will deliver to New Valley the certificate required by Section 5.3(d).
1.5 Exemption from Registration. The Purchased Shares will be issued under an exemption or exemptions from registration under the Securities Act of 1933, as amended (the “Securities Act”). The certificate(s) evidencing the Purchased Shares shall, upon issuance, contain the following legend (in addition to any other legends required to be placed thereon by applicable state blue sky or securities Laws):
THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT UNDER |
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ANY CIRCUMSTANCES BE SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF UNLESS THEY HAVE BEEN REGISTERED UNDER THAT ACT AND ANY APPLICABLE SECURITIES LAWS OR AN EXEMPTION FROM REGISTRATION IS AVAILABLE. |
II. REPRESENTATIONS AND WARRANTIES OF THE PARTNERSHIP
The Partnership hereby represents and warrants to New Valley, except as set forth in the letter, dated the date of this Agreement, from the Partnership to New Valley specifically referencing this Agreement and delivered prior to the execution of this Agreement (the “Partnership Disclosure Letter”), as follows:
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(b) All outstanding capital stock or other equity interests of each Subsidiary of the Partnership are owned directly or indirectly by the Partnership, free and clear of all Liens. All outstanding shares of capital stock owned by the Partnership of each Subsidiary of the Partnership that is a corporation have been validly issued and are fully paid and nonassessable. All limited liability company interests owned by the Partnership of each Subsidiary of the Partnership that is a limited liability company and all partnership interests owned by the Partnership of each Subsidiary of the Partnership that is a limited partnership have been validly issued and are fully paid (to the extent required as of the date of this Agreement). No shares of capital stock or other equity interests of any Subsidiary of the Partnership are subject to, nor have any been issued in violation of, preemptive or similar rights.
(c) There are not (and as of the Closing Date there will not be) outstanding (i) any shares of capital stock or other equity securities of any Subsidiary of the Partnership, (ii) any securities of any Subsidiary of the Partnership convertible into or exchangeable for shares of capital stock or other equity securities of any Subsidiary of the Partnership, or (iii) any options or other rights to acquire from the Partnership or any of its Subsidiaries, or any obligation of the Partnership or any of its Subsidiaries to issue or sell, any shares of capital stock or other equity securities of any Subsidiary of the Partnership or any securities convertible into or exchangeable for such capital stock or equity securities.
(d) Neither the Partnership nor any of its Subsidiaries is a party to, or has Knowledge of, any agreement restricting the transfer or hypothecation of any capital stock or equity interests of any Subsidiary, other than the DIP Facility.
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(b) The execution and delivery of this Agreement by the Partnership do not, and the performance of this Agreement and the consummation of the transactions contemplated hereby by the Partnership or New Globalstar will not, require any consent, approval, authorization or permit of, or filing with or notification to, any domestic or foreign governmental or regulatory authority, including any department, commission, board, bureau, agency or instrumentality of such authority, or any court or tribunal (each a “Governmental Entity”), except (i) for (A) the applicable requirements, if any, of the Securities Exchange Act of 1934, as amended, and the rules and regulations thereunder (the “Exchange Act”), (B) the applicable notification requirements, if any, of the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 1976, as amended, and the rules and regulations thereunder (the “HSR Act”), (C) the applicable notification or approval requirements, if any, of the Federal Communications Commission (the “FCC”), the United States Department of Defense (the “DoD”), the Federal Bureau of Investigation (the “FBI”) and the United States Department of Justice (the “DoJ”), and (D) the entry of the Confirmation Order and (ii) where the failure to obtain any such consent, approval, authorization or permit, or to make any such filing or notification, would not, individually or in the aggregate, have a Partnership Material Adverse Effect.
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end audit adjustments). As of the time of the filing of any relevant Partnership Report, to the Knowledge of the Partnership, the financial forecasts or projections included in such Partnership Report (as qualified and limited in the Partnership Report) were made by management of the Partnership in good faith and on a reasonable basis, except for any failure to make the financial forecasts or projections in good faith and on a reasonable basis that would not have a Partnership Material Adverse Effect. No Subsidiary of the Partnership is currently required to file any periodic reports with the SEC under the Exchange Act.
2.10 Bring-Down of Bankruptcy Disclosure Schedules. The Partnership Disclosure Letter sets forth information with respect to the Debtors that would have been required to be set forth on schedules A, B and G pursuant to section 521 of the Bankruptcy Code and the Official Bankruptcy Forms if the Debtors were to have commenced the Chapter 11 Cases on December 31, 2002 rather than the date on which they were actually commenced, and, to the Knowledge of the Partnership, such information set forth in the Partnership Disclosure Letter is true, correct and complete in all material respects.
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III. REPRESENTATIONS AND WARRANTIES OF NEW VALLEY
New Valley represents and warrants to the Partnership as follows:
(b) The execution and delivery of this Agreement by New Valley do not, and the performance of this Agreement and the consummation of the transactions contemplated hereby by New Valley will not, require any consent, approval, authorization or permit of, or filing with or notification to, any Governmental Entity, except (i) for (A) applicable requirements, if any, of the Exchange Act, (B) the applicable notification requirements, if any, of the HSR Act, and (C) the applicable notification or approval requirements, if any, of the FCC, the DoD, the FBI and the DoJ and (ii) where failure to obtain such consents, approvals, authorizations or permits, or to make such filings or notifications, would not, individually or in the aggregate, have a New Valley Material Adverse Effect.
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4.3 Publicity. The initial press release relating to this Agreement will be in the form of a joint press release previously agreed to by New Valley and the Partnership, and thereafter the Partnership (or New Globalstar, as applicable), the Creditors Committee and New Valley will, subject to their respective legal obligations, consult with each other party hereto, and use reasonable efforts to agree, in advance, upon the text of any press release or other public statements with respect to the transactions contemplated hereby, including those contained in any filings with any Governmental Entity or with any securities exchange or similar body with respect thereto.
(b) Without limiting the generality or effect of Section 4.5(a), (i) the Partnership and New Valley will, as soon as practicable, (A) file any required Notification and Report Forms under the HSR Act with the Federal Trade Commission (the “FTC”) and the Antitrust Division of the DoJ (the “Antitrust Division”) and (B) file any additional required notifications or applications, if any, with the FCC, DoD, FBI and DoJ and (ii) the Partnership and New Valley will use their respective reasonable best efforts to respond as promptly as practicable to all inquiries received from any such Governmental Entity for additional information or documentation.
4.6 No Solicitations. (a) From the date on which the Bankruptcy Court expressly approves this Section 4.6 until the earlier of the Closing and the termination of this Agreement in accordance with Section 7.1 or 7.2 (the “Non-Solicitation Period”), the Partnership and the Creditors Committee shall not solicit, accept or in any way seek to further any offer to purchase any equity in or assets of the Partnership, New Globalstar or any other entity to be formed through the restructuring of the Partnership or take any other action inconsistent with confirmation of the Chapter 11 Plan and the consummation of the transactions contemplated by this Agreement; provided, however, that (i) the Partnership may file this Agreement and any document contemplated hereby (the “Transaction Documents”) with the SEC, as an exhibit to a Current Report on Form 8-K and (ii) if and to the extent determined by the Partnership in good faith to be necessary to cause the Disclosure Statement to contain “adequate information” as contemplated by section 1125 of the Bankruptcy Code, the Disclosure Statement shall contain a description of any contacts received by either of the Partnership or the Creditors Committee with respect to an offer to purchase any equity in or assets of the Partnership, New Globalstar or any other entity to be formed through the restructuring of the Partnership. If any Person contacts the Partnership or the Creditors Committee with an offer to purchase any equity in or assets of the Partnership, New Globalstar or any other entity to be formed through the restructuring of the Partnership, then the Partnership or the Creditors Committee, as the case may be, shall (i) inform such Person of the existence and substantive effect of this Section 4.6 and the public availability of the Transaction
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--
Documents and (ii) subject to the terms of any confidentiality restrictions on Globalstar in effect on the date hereof (provided that, if permitted by such restrictions, Globalstar has delivered to New Valley a copy of the written instrument containing such restrictions on or before the date hereof), promptly give to New Valley notice of such contact (A) identifying the Person making such contact and (B) specifying in reasonable detail (x) the nature of such contact and (y) the terms and conditions of any proposal made by such Person.
(b) During the Non-Solicitation Period, the Partnership and the Creditors Committee will use their respective reasonable best efforts to make effective the transactions contemplated by this Agreement and the Chapter 11 Plan.
(a) amend or modify their partnership agreements, certificates of incorporation, bylaws or other equivalent organizational documents in any material respect from their form on the date of this Agreement;
(b) change any salaries or other compensation of, or pay any bonuses to, any director, officer or employee or enter into any employment, severance, or similar agreement with any director, officer or employee;
(c) adopt or increase any benefits under any profit sharing, bonus, deferred compensation, savings, insurance, pension, retirement, or other employee benefit plan for or with any of its employees;
(d) enter into (i) any lease or (ii) any other contract or commitment, except such leases, contracts and commitments that are entered into in the ordinary course of business consistent with past practice and not inconsistent with the Approved Budget;
(e) incur, assume or guarantee any debt, except accounts payable incurred in the ordinary course of business consistent with past practice;
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(f) enter into any contract, transaction or commitment relating to their respective assets or businesses that, individually or in the aggregate, could be material to the Partnership or any of its Subsidiaries, or cancel or waive any claim or right of substantial value that, individually or in the aggregate, could be material to the Partnership or any of its Subsidiaries;
(g) set aside or pay any dividend or make any other distribution with respect to equity interests in the Partnership or any of its Subsidiaries or repurchase, redeem or otherwise acquire, directly or indirectly, any outstanding equity interests in, or other securities of, the Partnership or any of its Subsidiaries;
(h) make any change in their financial or tax accounting methods or practices, except as required by applicable Law or United States generally accepted accounting principles;
(i) issue or sell any equity interests in the Partnership or any of its Subsidiaries or make any other changes in their respective capital structures;
(j) sell, lease or otherwise dispose of any material asset or property;
(k) (i) write-off as uncollectable any notes or accounts receivable except write-offs in the ordinary course of business charged to reserves, none of which is individually or in the aggregate material, (ii) write-off, write-up or write-down any other material asset or (iii) alter the customary time periods for collection of accounts receivable or payments of accounts payable;
(l) create or assume any Lien other than a Permitted Lien;
(m) make any loan, advance or capital contributions to or investment in any Person;
(n) terminate or make any material change in the conduct of the business or operation of the Partnership or any of its Subsidiaries; or
(o) agree to or contract to do any of the foregoing.
(b) In the event that the Creditor Securities are not registered under Section 12 of the Exchange Act and listed on a national securities exchange or quoted on The NASDAQ Stock Market, Inc. as of the Closing Date, New Valley will (i) use its reasonable best efforts to cause the Creditor Securities to be so registered and so listed or quoted as promptly as practicable following the Closing Date, and (ii) in any event, cause New Globalstar to file within 60 calendar days after the Closing Date (A) with the SEC, a registration statement or appropriate report on the applicable form to cause the Creditor Securities to be so registered (if such a registration statement or report was not filed by New Globalstar prior to the Closing Date) and (B) with a national securities exchange or The NASDAQ Stock Market, Inc., an initial application to cause the Creditor Securities to be so listed or quoted (if such an application was not filed by New Globalstar prior to the Closing Date). Without limiting the generality of the foregoing, New Valley shall nominate, and cause to be elected, a sufficient number of “independent directors,” as defined pursuant to the Exchange Act, and the rules of the national securities exchange on which the Creditor Securities are, or are expected to be, listed or of The NASDAQ Stock Market, Inc., if the Creditor
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Securities are, or are expected to be, quoted on an automated quotation system thereof, to permit New Globalstar to be in compliance with the Exchange Act, and to allow the Creditor Securities to become so listed or quoted.
(c) With respect to each of the Creditor Securities, New Valley will use its reasonable best efforts, until such time as the applicable Creditor Securities are owned by fewer than 100 beneficial holders, to maintain (i) the registration under Section 12 of the Exchange Act of such Creditor Securities and (ii) the listing on a national securities exchange or quotation on The NASDAQ Stock Market, Inc. of such Creditor Securities.
4.10 Interim Operations of New Globalstar. New Globalstar will be formed solely for the purpose of engaging in the transactions contemplated by this Agreement and, until the Effective Date, will not engage in any business activity or operations, or incur any liability or obligation, other than in connection with such transactions. The Partnership will cause (a) the Certificate of Incorporation of New Globalstar, substantially in the form of Exhibit F hereto, to be filed with the Secretary of State of the State of Delaware on or before the Effective Date, (b) the Bylaws of New Globalstar, substantially in the form of Exhibit G hereto, to be adopted on or before the Effective Date, and (c) such Certificate of Incorporation and Bylaws to be in full force and effect on the Closing Date.
5.1 Conditions to Each Party’s Obligations. The respective obligations of each party to consummate the transactions contemplated by this Agreement are subject to the satisfaction or waiver, at or prior to the Closing, of the following conditions:
(a) All conditions precedent to the effectiveness of the Confirmed Chapter 11 Plan shall have been satisfied or waived pursuant to the provisions therein.
(b) The waiting period (and any extension thereof) under the HSR Act, if any, applicable to the consummation of the transactions contemplated by this Agreement shall have been terminated or shall have expired.
(c) All approvals of the FCC, the DoD, the FBI and the DoJ, if any, required in connection with the consummation of the transactions contemplated by this Agreement shall have been obtained.
(d) No Order or Law enacted, entered, promulgated, enforced or issued by any court of competent jurisdiction or other Governmental Entity or other legal restraint or prohibition preventing the consummation of the transactions contemplated by this Agreement shall be in effect.
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(e) The Partnership and Loral Space and Communications Ltd. shall have entered into the agreement contemplated by Section 3.1(c)(iii) of the DIP Facility.
(f) The Partnership and QUALCOMM, Incorporated shall have entered into the agreement contemplated by Section 3.1(c)(iv) of the DIP Facility.
5.2 Conditions to Obligations of the Partnership. The obligations of the Partnership to consummate the transactions contemplated by this Agreement are subject to the satisfaction or waiver, at or prior to the Closing, of the following conditions:
(a) New Valley shall have delivered the Cash Purchase Price payable by New Valley in accordance with Section 1.2 to New Globalstar.
(b) All representations and warranties of New Valley contained in this Agreement shall be true and correct in all material respects on the Closing Date (except for representations and warranties made as of a specific date, which shall be true and correct as of such date), except for such representations and warranties qualified as to materiality or New Valley Material Adverse Effect, which representations and warranties shall be true and correct in all respects on the Closing Date.
(c) All material covenants contained in this Agreement and required to be performed or complied with by New Valley shall have been performed or complied with by New Valley in all material respects.
(d) New Valley shall have delivered to the Partnership a certificate of an executive officer of New Valley certifying to the satisfaction of the conditions set forth in (b) and (c) above.
(a) New Globalstar shall have delivered one or more validly issued stock certificates representing the Purchased Shares to New Valley.
(b) All representations and warranties of the Partnership contained in this Agreement shall be true and correct in all material respects on the Closing Date (except for representations and warranties made as of a specific date, which shall be true and correct as of such date), except for such representations and warranties qualified as to materiality or the Partnership Material Adverse Effect, which representations and warranties shall be true and correct in all respects on the Closing Date.
(c) All material covenants contained in this Agreement and required to be performed or complied with by the Partnership shall have been performed or complied with by the Partnership in all material respects.
(d) The Partnership shall have delivered to New Valley a certificate of an executive officer of the Partnership certifying to the satisfaction of the conditions set forth in (b) and (c) above.
VI. NO SURVIVAL
None of the representations, warranties, covenants and agreements in this Agreement shall survive the Closing, except that nothing in this Article VI shall limit any covenant or agreement of a party which by its terms contemplates performance by such party after the Closing.
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(i) | the Chapter 11 Plan and the Disclosure Statement have not been filed with the Bankruptcy Court on or before January 30, 2003, and New Valley delivers written notice of termination to the Partnership on or before February 6, 2003; | |||
(ii) | (A) the DIP Facility has not been approved by an order, in form and substance satisfactory to New Valley, entered by the Bankruptcy Court at a final hearing in accordance with Fed. R. Bankr. Proc. 4001(c)(2) (a “Final Hearing”) on or before January 30, 2003, and New Valley delivers written notice of termination to the Partnership on or before February 6, 2003, or (B) if the DIP Facility is so approved, a stay of any provision of the approval order is issued and New Valley delivers written notice of termination to the Partnership on or before the fifth Business Day after New Valley receives notice of the issuance of such stay; | |||
(iii) | the provisions in this Section 7.2 and Sections 4.6, 7.3 and 7.4 of this Agreement (A) have not been approved by an order, in form and substance satisfactory to New Valley, entered by the Bankruptcy Court at a Final Hearing on or before January 30, 2003 and New Valley delivers written notice of termination to the Partnership on or before February 6, 2003, or (B) if such provisions are so approved, a stay of any provision of the approval order is issued, and New Valley delivers written notice of termination to the Partnership on or before the fifth Business Day after New Valley receives notice of the issuance of such stay; | |||
(iv) | the Disclosure Statement has not been approved by the Bankruptcy Court as containing adequate information in accordance with section 1125 of the Bankruptcy Code on or before March 7, 2003, and New Valley delivers written notice of termination to the Partnership on or before March 14, 2003; | |||
(v) | the Chapter 11 Plan has not been confirmed by final, nonappealable order of the Bankruptcy Court on or before May 7, 2003, and New Valley delivers written notice of termination to the Partnership on or before May 14, 2003; | |||
(vi) | the Effective Date has not occurred on or before July 7, 2003, and New Valley delivers written notice of termination to the Partnership on or before July 15, 2003; | |||
(vii) | a Partnership Material Adverse Effect occurs; |
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(viii) | there shall have occurred an Event of Default and, as a result thereof, the New Valley Lender shall have declared that all or any portion of the Commitment is terminated and that all Obligations under the DIP Facility are forthwith due and payable; | |||
(ix) | there shall have been a default under or breach of the covenants contained in Section 4.6 by either the Partnership or Creditors Committee; or | |||
(x) | there shall have been a default under or breach of any representation, warranty, covenant or agreement of the Partnership contained in this Agreement (except for a default or breach covered by Section 7.2(a)(i) through Section 7.2(a)(viii), inclusive), which default or breach shall be incapable of being cured or, if capable of being cured, shall not have been cured within 30 calendar days following receipt by the Partnership from New Valley of written notice of such default or breach (specifying in reasonable detail the claimed default or breach and demand of its cure or satisfaction) and which default or breach would result in a failure of a condition set forth in Article V. |
(b) This Agreement may be terminated by the Partnership by written notice to New Valley if:
(i) | the New Valley DIP Lender refuses or otherwise fails to fund any requested draw under the DIP Facility that complies with the applicable provisions of the DIP Facility and applicable Law; | |||
(ii) | there shall have been a material adverse change in the ability of the New Valley DIP Lender to fund draws under the DIP Facility or the ability of New Valley to pay the Cash Purchase Price pursuant to Section 1.2, which material adverse change has not been cured within five Business Days after the Partnership delivers written notice thereof to New Valley; | |||
(iii) | the DIP Facility has not been approved by an order entered by the Bankruptcy Court at a Final Hearing on or before January 30, 2003, and the Partnership delivers written notice to New Valley of termination on or before February 6, 2003; | |||
(iv) | (A) under the terms of the DIP Facility, the Partnership has no ability to draw funds under the DIP Facility, (B) New Valley refuses to advance further funds to the Partnership on terms reasonably acceptable to the Partnership, and (C) the Partnership has cash-on-hand that is less than its cash-on-hand as of the date the DIP Facility was approved at a Final Hearing; | |||
(v) | a New Valley Material Adverse Effect occurs; or | |||
(vi) | the Effective Date has not occurred on or before December 31, 2003. |
(c) In addition to the provisions of Section 7.2(a), this Agreement may be terminated by New Valley by written notice to the Partnership if there shall have occurred a QUALCOMM Related
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Termination Event and, as a result thereof, the New Valley Lender shall have declared that all or any portion of the Commitment is terminated and that all Obligations under the DIP Facility are forthwith due and payable.
(d) In addition to the provisions of Section 7.2(b), this Agreement may be terminated by the Partnership by written notice to New Valley at any time prior to the commencement of the Non-Solicitation Period.
(b) In the event this Agreement is terminated by New Valley in accordance with Section 7.2(c) or by the Partnership in accordance with Section 7.2(d), then the Partnership will pay to New Valley such amount, if any, that may be ordered by the Bankruptcy Court based on a substantial contribution or similar theory as a reimbursement of New Valley’s fees and expenses; provided, however, that in the event of a liquidation of the Partnership following termination of this Agreement, any such payment shall be subordinate to the payment of Wind-Down Costs, but only to the extent Wind-Down Costs do not exceed the Wind-Down Funds.
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(c) Any payment to New Valley pursuant to this Section 7.4 shall be by wire transfer of immediately available funds to such account or accounts as New Valley shall designate in writing.
If to New Valley:
New Valley Corporation 000 X.X. Xxxxxx Xxxxxx Xxxxx, Xxxxxxx 00000 Attn: Xxxxxxx X. Xxxxxx, Esq. Fax No.: (000) 000-0000 |
With copies to:
Kasowitz, Benson, Xxxxxx & Xxxxxxxx LLP 0000 Xxxxxxxx Xxx Xxxx, Xxx Xxxx 00000 Attn: Xxxxx X. Xxxxxx, Esq. Fax No.: (000) 000-0000 |
|
and | |
Xxxxxxxxxxxx Xxxx & Xxxxxxxxx 1221 Avenue of the Americas Xxx Xxxx, Xxx Xxxx 00000 Attn: Xxxxxxx X. Xxxxxxxx, Esq. Fax No.: (000) 000-0000 |
If to the Partnership or New Globalstar:
Globalstar, L.P. (or the name of New Globalstar) 0000 Xxxxxx Xxxx Xxx Xxxx, Xxxxxxxxxx 00000 Attn: Xxxxxxx Xxxxx, Esq. Fax No.: (000) 000-0000 |
With copies to:
Xxxxx Day 000 Xxxx 00xx Xxxxxx Xxx Xxxx, Xxx Xxxx 00000 Attn: Xxxx X. Xxxxx, Esq. Fax No.: (000) 000-0000 |
and
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Akin Gump Xxxxxxx Xxxxx & Xxxx LLP 000 Xxxxxxx Xxxxxx Xxx Xxxx, Xxx Xxxx 00000 Attn: Xxxxxxx X. Xxxx, Esq. and Xxxxxx X. Xxxxxx, Esq. Fax No.: (000) 000-0000 |
If to the Creditors Committee:
Official Committee of Unsecured Creditors of Globalstar, L.P. c/o Akin Gump Xxxxxxx Xxxxx & Xxxx LLP 000 Xxxxxxx Xxxxxx Xxx Xxxx, Xxx Xxxx 00000 Attn: Xxxxxxx X. Xxxx, Esq. and Xxxxxx X. Xxxxxx, Esq. Fax No.: (000) 000-0000 |
With copies to:
Xxxxx Day 000 Xxxx 00xx Xxxxxx Xxx Xxxx, Xxx Xxxx 00000 Attn: Xxxx X. Xxxxx, Esq. Fax No.: (000) 000-0000 |
or to such other address as any party will specify by written notice so given, and such notice will be deemed to have been delivered as of the date so telecommunicated or delivered by hand or courier service.
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8.5 Governing Law. This Agreement will be governed by and construed in accordance with the laws of the State of New York, without regard to its conflict of laws principles.
8.8 Certain Definitions/Interpretations. (a) For purposes of this Agreement:
“Affiliate” of any Person means any other Person that, directly or indirectly, through one or more intermediaries, controls, is controlled by, or is under common control with, such first Person; and, for the purposes of this definition only, “control” (including the terms “controlling”, “controlled by” and “under common control with”) means the possession, direct or indirect, of the power to direct or cause the direction of the management, policies or activities of a Person whether through the ownership of securities, by contract or agency or otherwise; provided that (i) as such term is used in this Agreement, New Valley shall not be included as an Affiliate of the Partnership and (ii) as used in Section 3.7, Ladenburg Xxxxxxxx Financial Services, Inc. and its Subsidiaries shall not be included as an Affiliate of New Valley; | |
“Agreement” has the meaning set forth in the introduction to this Agreement; | |
“Antitrust Division” has the meaning set forth in Section 4.5(b); | |
“Approved Budget” has the meaning set forth in the DIP Facility; | |
“Bankruptcy Code” has the meaning set forth in the introduction to this Agreement; | |
“Bankruptcy Court” has the meaning set forth in the introduction to this Agreement; | |
A Person will be deemed the “beneficial owner” of, and will be deemed to “beneficially own,” and will be deemed to have “beneficial ownership” of: |
(i) any securities that such Person or any of such Person’s Affiliates is deemed to “beneficially own” within the meaning of Rule 13d-3 under the Exchange Act, as in effect on the date of this Agreement and any securities deposited into a trust |
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established by the Person the sole beneficiaries of which are the shareholders of the Person; | |
(ii) any securities (the “underlying securities”) that such Person or any of such Person’s Affiliates has the right to acquire (whether such right is exercisable immediately or only after the passage of time) pursuant to any agreement, arrangement or understanding (written or oral), or upon the exercise of conversion rights, exchange rights, rights, warrants or options, or otherwise (it being understood that such Person will also be deemed to be the beneficial owner of the securities convertible into or exchangeable for the underlying securities); and | |
(iii) any securities beneficially owned by persons that are part of a “group” (within the meaning of Rule 13d-5(b) under the Exchange Act) with such Person; |
“Cash Purchase Price” has the meaning set forth in Section 1.1; | |
“Certificate of Designation” has the meaning set forth in the introduction to this Agreement; | |
“Chapter 11 Cases” has the meaning set forth in the introduction to this Agreement; | |
“Chapter 11 Plan” has the meaning set forth in the introduction to this Agreement; | |
“Closing” has the meaning set forth in Section 1.3; | |
“Closing Date” has the meaning set forth in Section 1.3; | |
“Commitment” has the meaning set forth in the DIP Facility; | |
“Common Stock” has the meaning set forth in the introduction to this Agreement; | |
“Confidentiality Agreement” means the confidentiality agreement, dated as of November 6, 2002, by and between New Valley and the Partnership; | |
“Confirmed Chapter 11 Plan” has the meaning set forth in the introduction to this Agreement; | |
“Continuing Satellite Anomalous Event” means, with respect to any particular satellite in the Partnership’s satellite constellation, one or more satellite anomalous events that cause such satellite to remain out of service for at least 45 consecutive calendar days; | |
“Copyright Licenses” means any written agreement naming any Debtor as licensor or licensee granting any right under any Copyright, including the grant of rights to copy, publicly perform, create derivative works, manufacture, distribute, exploit and sell material derived from any Copyright; | |
“Copyrights” means (i) all copyrights arising under the laws of the United States, any other country or any political subdivision thereof, whether registered or unregistered and |
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whether published or unpublished, all registrations and recordings thereof, and all applications in connection therewith, including all registrations, recordings and applications in the United States Copyright Office or in any foreign counterparts thereof and (ii) the right to obtain all renewals thereof; | |
“Creditor Preferred Shares” has the meaning set forth in Section 2.2; | |
“Creditors Committee” has the meaning set forth in the introduction to this Agreement; | |
“Creditor Securities” has the meaning set forth in Section 4.8(a); | |
“Creditor Shares” has the meaning set forth in Section 2.2; | |
“Debtors” has the meaning set forth in the introduction to this Agreement; | |
“DIP Facility” has the meaning set forth in the introduction to this Agreement; | |
“DIP Facility Pay-Off Amount” has the meaning set forth in Section 1.1; | |
“Disclosure Statement” has the meaning set forth in the introduction to this Agreement; | |
“DoD” has the meaning set forth in Section 2.5(b); | |
“DoJ” has the meaning set forth in Section 2.5(b); | |
“Event of Default” has the meaning set forth in the DIP Facility; | |
“Exchange Act” has the meaning set forth in Section 2.5(b); | |
“FBI” has the meaning set forth in Section 2.5(b); | |
“FCC” has the meaning set forth in Section 2.5(b); | |
“FCC Licenses” means the FCC licenses issued to the Partnership, Loral/QUALCOMM Partnership, L.P. or any of their respective Subsidiaries by the FCC and listed on the Partnership Disclosure Letter; | |
“Final DIP Order” has the meaning set forth in the DIP Facility; | |
“FTC” has the meaning set forth in Section 4.5(b); | |
“Governmental Entity” has the meaning set forth in Section 2.5(b); | |
“HSR Act” has the meaning set forth in Section 2.5(b); | |
“Intellectual Property” means, collectively, all rights, priorities and privileges of any Debtor relating to intellectual property, whether arising under United States, multinational or foreign laws or otherwise, including Copyrights, Copyright Licenses, Patents, Patent Licenses, Trademarks, Trademark Licenses and trade secrets, and all rights to xxx at law or in equity for |
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any infringement or other impairment thereof, including the right to receive all proceeds and damages therefrom; | |
“Knowledge” means, with respect to either party, the actual knowledge of such party after reasonable inquiry of such party’s executive officers; | |
“Law” means any domestic or foreign statute, rule, regulation or other legal requirement; | |
“Liens” means liens, claims, security interests, encumbrances, restrictions on voting or alienation or otherwise, or adverse interests; | |
“Management Presentation Material” means the written material delivered to New Valley by the Partnership and dated November 18-19, 2002; | |
“New Globalstar” has the meaning set forth in the introduction to this Agreement; | |
“New Valley” has the meaning set forth in the introduction to this Agreement; | |
“New Valley DIP Lender” has the meaning set forth in the introduction to this Agreement; | |
“New Valley Material Adverse Effect” means any change, effect, event or condition that has prevented or could reasonably be expected to prevent New Valley’s ability to consummate the transactions contemplated hereby; | |
“New Valley Termination Event” has the meaning set forth in Section 7.2(a); | |
“Non-Solicitation Period” has the meaning set forth in Section 4.6(a); | |
“Obligations” has the meaning set forth in the DIP Facility; | |
“Order” has the meaning set forth in Section 2.5; | |
“Partnership” has the meaning set forth in the introduction to this Agreement; | |
“Partnership Disclosure Letter” has the meaning set forth in the first paragraph of Article II; | |
“Partnership Material Adverse Effect” means any change, effect, event or condition that has had or could reasonably be expected to have a material adverse effect on the assets or operations of the Partnership, New Globalstar and their Subsidiaries, taken as a whole, or that would prevent the Partnership or New Globalstar, as applicable, from consummating the transactions contemplated hereby; provided, however, that the loss of satellite availability shall not constitute a Partnership Material Adverse Effect unless, following the date hereof, (i) more than one additional satellite in the Partnership’s satellite constellation shall have been declared “failed” or (ii) five or more additional satellites in the Partnership’s satellite constellation shall have experienced Continuing Satellite Anomalous Events; |
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“Partnership Reports” means all forms, reports and documents filed by the Partnership with the SEC between January 1, 2002 and the Closing Date, in each case under Section 13 of the Exchange Act and the rules and regulations promulgated thereunder; | |
“Patent Licenses” means all agreements, whether written or oral, providing for the grant by or to any Debtor of any right to manufacture, use, import, sell or offer for sale any invention covered in whole or in part by a Patent; | |
“Patents” means (i) all letters patent of the United States, any other country or any political subdivision thereof and all reissues and extensions thereof, (ii) all applications for letters patent of the United States or any other country and all divisions, continuations and continuations-in-part thereof, and (iii) all rights to obtain any reissues or extensions of the foregoing; | |
“Permitted Lien” means any mechanics’, workmen’s, repairmen’s and other similar Liens arising or incurred in the ordinary course of business in respect of obligations that are not overdue; | |
“Person” means an individual, a corporation, a partnership, a limited liability company, a joint venture, an association, a trust, an unincorporated organization or any other entity; | |
“PIK Interest Note” has the meaning set forth in the DIP Facility; | |
“Plan Warrants” has the meaning set forth in the introduction to this Agreement; | |
“Preferred Stock” has the meaning set forth in the introduction to this Agreement; | |
“Purchased Shares” has the meaning set forth in Section 1.1; | |
“QUALCOMM Related Termination Event” has the meaning set forth in the DIP Facility; | |
“SEC” has the meaning set forth in Section 2.6; | |
“Securities Act” has the meaning set forth in Section 1.5; | |
“Series A Warrants” has the meaning set forth in the introduction to this Agreement; | |
“Series B Warrants” has the meaning set forth in the introduction to this Agreement; | |
“Subsidiary” when used with respect to any party, means any corporation or other organization, whether incorporated or unincorporated, of which such party directly or indirectly owns or controls more than 50% of the securities or other interests having by their terms ordinary voting power to elect a majority of the board of directors or others performing similar functions; | |
“Termination Payment” has the meaning set forth in Section 7.4; |
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“Term Note Loans” has the meaning set forth in the DIP Facility; | |
“Trademarks” means (i) all trademarks, trade names, corporate names, company names, business names, fictitious business names, trade styles, service marks, logos and other source or business identifiers, and all goodwill associated therewith, now existing or hereafter adopted or acquired, all registrations and recordings thereof, and all applications in connection therewith, whether in the United States Patent and Trademark Office or in any similar office or agency of the United States, any State thereof or any other country or any political subdivision thereof, or otherwise, and all common-law rights related thereto, and (ii) the right to obtain all renewals thereof; | |
“Transaction Documents” has the meaning set forth in Section 4.6; | |
“Wind-Down Costs” has the meaning set forth in the DIP Facility; and | |
“Wind-Down Funds” has the meaning set forth in the DIP Facility. |
(b) Capitalized terms used herein and not otherwise defined shall have the meanings ascribed to such terms in the Chapter 11 Plan.
(c) When a reference is made in this Agreement to an Article, Section or Exhibit such reference will be to an Article or Section of, or an Exhibit to, this Agreement unless otherwise indicated. Whenever the words “include,” “includes” or “including” are used in this Agreement, they will be deemed to be followed by the words “without limitation.” The words “hereof,” “herein,” “hereto” and “hereunder” and words of similar import when used in this Agreement will refer to this Agreement as a whole and not to any particular provision of this Agreement. All terms used herein with initial capital letters have the meanings ascribed to them herein and all terms defined in this Agreement will have such defined meanings when used in any certificate or other document made or delivered pursuant hereto unless otherwise defined therein. The definitions contained in this Agreement are applicable to the singular as well as the plural forms of such terms and to the masculine as well as to the feminine and neuter genders of such term. Any agreement, instrument or statute defined or referred to herein or in any agreement or instrument that is referred to herein means such agreement, instrument or statute as from time to time amended, modified or supplemented, including (in the case of agreements or instruments) by waiver or consent and (in the case of statutes) by succession of comparable successor statutes and references to all attachments thereto and instruments incorporated therein. References to a Person include such Person’s permitted successors and assigns.
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Court, and any appellate court from such court, in any suit, action or proceeding arising out of or relating to this Agreement or the transactions contemplated hereby, or for recognition or enforcement of any judgment resulting from any such suit, action or proceeding, and each party hereby irrevocably and unconditionally agrees that all claims in respect of any such suit, action or proceeding may be heard and determined in the Bankruptcy Court.
(b) It will be a condition precedent to each party’s right to bring any such suit, action or proceeding that such suit, action or proceeding, in the first instance, be brought in the Bankruptcy Court, and if each such court refuses to accept jurisdiction with respect thereto, such suit, action or proceeding may be brought in any other court with jurisdiction.
(c) No party may move to (i) transfer any such suit, action or proceeding from the Bankruptcy Court to another jurisdiction, (ii) consolidate any such suit, action or proceeding brought in the Bankruptcy Court with a suit, action or proceeding in another jurisdiction, or (iii) dismiss any such suit, action or proceeding brought in the Bankruptcy Court for the purpose of bringing the same in another jurisdiction.
(d) Each party hereby irrevocably and unconditionally waives, to the fullest extent it may legally and effectively do so, (i) any objection that it may now or hereafter have to the laying of venue of any suit, action or proceeding arising out of or relating to this Agreement in the Bankruptcy Court, (ii) the defense of an inconvenient forum to the maintenance of such suit, action or proceeding in any such court, and (iii) the right to object, with respect to such suit, action or proceeding, that such court does not have jurisdiction over such party. Each party irrevocably consents to service of process in any manner permitted by Law.
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GLOBALSTAR, L.P. | ||||
By: | ||||
Name: | ||||
Title: | ||||
NEW VALLEY CORPORATION | ||||
By: | ||||
Name: | ||||
Title: | ||||
OFFICIAL COMMITTEE OF UNSECURED CREDITORS OF GLOBALSTAR, L.P. (solely with respect to Sections 4.3, 4.4, 4.5(a), 4.6 and 8.4) | ||||
By: | ||||
Name: | ||||
Title: | ||||
Exhibit A
Form of First Amended Chapter 11 Plan of Reorganization
Exhibit B
Form of Disclosure Statement
Exhibit C
Form of Certificate of Designation
Exhibit D
Form of Warrant Agreement (Series A Warrants)
Exhibit E
Form of Warrant Agreement (Series B Warrants)
Exhibit F
Form of Certificate of Incorporation
Exhibit G
Form of Bylaws
Exhibit H
Form of Voting Agreement