1
EXHIBIT 1
7,000,000 SHARES OF COMMON STOCK
AMERICAN MOBILE SATELLITE CORPORATION
UNDERWRITING AGREEMENT
July ___, 1999
Bear, Xxxxxxx & Co. Inc.
Credit Suisse First Boston Corporation
Deutsche Bank Securities Inc.
SoundView Technology Group, Inc.
c/o Bear, Xxxxxxx & Co. Inc.
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
American Mobile Satellite Corporation, a Delaware corporation (the
"Company"), proposes, subject to the terms and conditions stated herein, to
issue and sell to the several underwriters named in Schedule I hereto
(collectively, the "Underwriters") an aggregate of 7,000,000 shares (the "Firm
Shares") of its common stock, par value $0.01 per share (the "Common Stock"). In
addition, for the sole purpose of covering over-allotments in connection with
the sale of the Firm Shares, Motorola, Inc., a Delaware corporation
("Motorola"), proposes, at the option of the Underwriters, to sell to the
Underwriters up to an additional 1,050,000 shares (the "Additional Shares") of
Common Stock owned by Motorola. The Firm Shares and any Additional Shares
purchased by the Underwriters are referred to herein as the "Shares". The Shares
are more fully described in the Registration Statement referred to below.
1. Representations and Warranties of the Company and Motorola.
(a) The Company represents and warrants to, and agrees with, each
of the Underwriters that:
(i) The Company has filed with the Securities and Exchange
Commission (the "Commission") a registration statement on Form S-3 (No.
333-81459), and one or more amendments thereto, and related preliminary
prospectuses for the registration under the Securities Act of 1933, as
amended (the "Securities Act"), of shares of Common Stock, which
registration statement, as so amended, has been declared effective by the
Commission and copies of which have heretofore been delivered to the
Underwriters. The registration statement, as amended at the time it
became effective, including the exhibits and information (if any) deemed
to be part of the registration statement at the time of effectiveness
pursuant to Rule 430A under the Securities Act and the documents
incorporated by reference therein pursuant to Item 12 of
2
Form S-3 which were filed under the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), is hereinafter referred to as the
"Registration Statement". If the Company has filed or is required
pursuant to the terms hereof to file a registration statement pursuant to
Rule 462(b) under the Securities Act registering additional shares of
Common Stock (a "Rule 462(b) Registration Statement"), then, unless
otherwise specified, any reference herein to the term "Registration
Statement" shall be deemed to include such Rule 462(b) Registration
Statement. Other than a Rule 462(b) Registration Statement, which became
effective upon filing, no other document with respect to the Registration
Statement has heretofore been filed with the Commission (other than
prospectuses filed pursuant to Rule 424(b) of the rules and regulations
of the Commission under the Securities Act (the "Securities Act
Regulations"), each in the form heretofore delivered to the
Underwriters). No stop order suspending the effectiveness of either the
Registration Statement or the Rule 462(b) Registration Statement, if any,
has been issued and no proceeding for that purpose has been initiated or,
to the Company's knowledge, threatened by the Commission. The Company, if
required by the Securities Act Regulations, proposes to file the
Prospectus (as defined below) with the Commission pursuant to Rule 424(b)
of the Securities Act Regulations. The Prospectus, in the form in which
it is to be filed with the Commission pursuant to Rule 424(b) of the
Securities Act Regulations, is hereinafter referred to as the
"Prospectus", except that, subject to Section 4(a) below, if any revised
prospectus or prospectus supplement shall be provided to the Underwriters
by the Company for use in connection with the offering and sale of the
Shares (the "Offering") which differs from the Prospectus (whether or not
such revised prospectus or prospectus supplement is required to be filed
by the Company pursuant to Rule 424(b) of the Securities Act
Regulations), the term "Prospectus" shall refer to such revised
prospectus or prospectus supplement, as the case may be, from and after
the time it is first provided to the Underwriters for such use. Any
preliminary prospectus or prospectus subject to completion included in
the Registration Statement or filed with the Commission pursuant to Rule
424 under the Securities Act is hereafter called a "Preliminary
Prospectus". All references in this Agreement to the Registration
Statement, the Rule 462(b) Registration Statement, a Preliminary
Prospectus and the Prospectus, or any amendments or supplements to any of
the foregoing, shall be deemed to refer to and include (i) any document
which is incorporated therein by reference, (ii) the filing of any
document under the Exchange Act after the effective date of the
Registration Statement, the date of such Preliminary Prospectus or the
date of the Prospectus, as the case may be, which is incorporated therein
by reference, and (iii) any copy thereof filed with the Commission
pursuant to its Electronic Data Gathering, Analysis and Retrieval System
("XXXXX").
(ii) The Registration Statement and the Prospectus, at the time
the Registration Statement became effective and as of the Closing Date
referred to in Section 2 hereof, complied and will comply in all material
respects with the requirements of the Securities Act and the Exchange Act
and the respective rules and regulations thereunder, and did not and as
of the Closing Date will not contain any untrue statement of a material
fact or omit to state any material fact required to be stated therein or
necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading. The Prospectus,
as of the date hereof (unless the term "Prospectus" refers to a
prospectus which has been provided to the Underwriters by the Company for
use in connection with the offering of the Shares which differs from the
Prospectus filed with the Commission pursuant to Rule 424(b) of the
Securities Act Regulations, in which case at the time it is first
provided to the Underwriters for such use) and on the Closing Date, does
not and will not include any untrue statement of a material fact or omit
to state a material fact necessary to make the statements therein, in the
light of the circumstances under which they were made, not misleading;
provided, however, that the representations and
2
3
warranties in this Section (1)(ii) shall not apply to statements in or
omissions from the Registration Statement or Prospectus made in reliance
upon and in conformity with information relating to any Underwriter
furnished to the Company in writing by any Underwriter (as described in
Section 12 hereof) expressly for use in the Registration Statement or the
Prospectus. The information contained in the Preliminary Prospectus and
Prospectus filed as part of the Registration Statement, as part of any
amendment thereto or pursuant to Rule 424 under the Securities Act
Regulations, if filed by electronic transmission pursuant to Regulation
S-T under the Securities Act, was identical to the information contained
in each copy thereof delivered to the Underwriters for use in connection
with the Offering (except as may be permitted by Regulation S-T under the
Securities Act). There are no contracts or other documents required to be
described in the Prospectus or to be filed as exhibits to the
Registration Statement under the Securities Act or the Exchange Act that
have not been described or filed therein as required, and there are no
business relationships or related-party transactions involving the
Company or any of its subsidiaries or any other person required to be
described in the Prospectus that have not been described therein as
required.
(iii) Each of the Company and its material subsidiaries listed in
Schedule II hereto (A) has been duly incorporated and is validly existing
as a corporation in good standing under the laws of its respective
jurisdiction of incorporation, (B) has all requisite corporate power and
authority to carry on its business as it is currently being conducted and
as described in the Prospectus and to own, lease and operate its
properties, and (C) is duly qualified and in good standing as a foreign
corporation authorized to do business in each jurisdiction in which the
nature of its business or its ownership or leasing of property requires
such qualification except where the failure to be so qualified could not
reasonably be expected to (x) result, individually or in the aggregate,
in a material adverse effect on the properties, business, results of
operations, condition (financial or otherwise) or affairs of the Company
and its subsidiaries, taken as a whole, (y) interfere with or materially
adversely affect the issuance or sale of the Shares pursuant hereto or
(z) in any manner materially adversely affect the validity of this
Agreement or the transactions described in the Prospectus under the
captions "How We Intend to Use the Proceeds from the Offering" or "The XM
Radio Transactions" (any of the events set forth in clauses (x), (y) or
(z), a "Material Adverse Effect").
(iv) All of the outstanding shares of capital stock of the Company
have been duly authorized, validly issued, and are fully paid and
nonassessable and were not issued in violation of any preemptive or
similar rights. The Shares, when issued, delivered and sold in accordance
with this Agreement, will be duly authorized and validly issued, fully
paid and nonassessable, and will not have been issued in violation of or
subject to any preemptive or similar rights. At March 31, 1999, after
giving effect to the issuance and sale of the Shares pursuant hereto and
the application of the net proceeds from the sale thereof, the Company
had the pro forma consolidated capitalization as set forth in the
Prospectus under the caption "Capitalization".
(v) Except as disclosed in the Prospectus, as of the dates
indicated therein and as of the Closing Date, all of the outstanding
capital stock of, or other ownership interests in, the Company's
subsidiaries is owned by the Company, free and clear of any security
interest, claim, lien, limitation on voting rights or encumbrance; and
all such securities have been duly authorized, validly issued, and are
fully paid and nonassessable and were not issued in violation of any
preemptive or similar rights.
3
4
(vi) Except as disclosed in the Prospectus, there are not
currently, and will not be as a result of the Offering, any outstanding
subscriptions, rights, warrants, calls, commitments of sale or options to
acquire or instruments convertible into or exchangeable for, any capital
stock or other equity interest of the Company or any of its subsidiaries.
(vii) The Common Stock (including the Shares) is registered
pursuant to Section 12(g) of the Exchange Act and is listed for quotation
on the Nasdaq National Market System ("Nasdaq"), and the Company has
taken no action designed to, or likely to have the effect of, terminating
the registration of the Common Stock under the Exchange Act or delisting
the Common Stock from Nasdaq, nor has the Company received any
notification that the Commission or Nasdaq is contemplating terminating
such registration or listing.
(viii) The Company has all requisite corporate power and authority
to execute, deliver and perform its obligations under this Agreement and
to consummate the transactions contemplated hereby, including, without
limitation, the corporate power and authority to issue, sell and deliver
the Shares as provided herein and the power to effect the Use of Proceeds
as described in the Prospectus.
(ix) The statistical and market-related data included in the
Prospectus are based on or derived from sources which the Company
believes to be reliable and accurate in all material respects.
(x) This Agreement has been duly and validly authorized, executed
and delivered by the Company and, assuming due and valid authorization,
execution and delivery by Motorola and the Underwriters, is the legal,
valid and binding agreement of the Company, enforceable against the
Company in accordance with its terms, except as such enforceability may
be limited by bankruptcy, insolvency, reorganization, moratorium and
other similar laws relating to or affecting creditor's rights generally,
by general equitable principles (regardless of whether such
enforceability is considered in a proceeding in equity or at law) and as
limited by the unenforceability under certain circumstances under law or
court decisions of provisions providing for the indemnification of or
contribution to a party with respect to a liability where such
indemnification or contribution is contrary to public policy.
(xi) Neither the Company nor any of its subsidiaries is, nor after
giving effect to the Offering will be, (A) in violation of its charter or
bylaws, (B) in default in the performance of any bond, debenture, note,
indenture, mortgage, deed of trust or other agreement or instrument to
which it is a party or by which it is bound or to which any of its
properties is subject which, singly or in the aggregate, could reasonably
be expected to have a Material Adverse Effect, or (C) in violation of any
local, state or federal law, statute, ordinance, rule, regulation,
requirement, judgment or court decree (including, without limitation, the
Communications Act of 1934 (the "Communications Act") and the rules and
regulations of the Federal Communications Commission (the "FCC"), and
environmental laws, statutes, ordinances, rules, regulations, judgments
or court decrees) applicable to the Company or any of its subsidiaries or
any of their assets or properties (whether owned or leased) which, singly
or in the aggregate, could reasonably be expected to have a Material
Adverse Effect. To the best knowledge of the Company, there exists no
condition that, with notice, the passage of time or otherwise, would
constitute a default under any such document or instrument which could
reasonably be expected to have a Material Adverse Effect.
4
5
(xii) Except as disclosed in the Prospectus, none of (a) the
execution, delivery or performance by the Company of this Agreement, (b)
the issuance and sale of the Shares and (c) the consummation by the
Company of the transactions contemplated hereby and in the Prospectus
under the heading "The XM Radio Transactions", violate, conflict with or
constitute a breach of any of the terms or provisions of, or a default
under (or an event that with notice or the lapse of time, or both, would
constitute a default), or require consent (other than consents that have
already been obtained) under, or result in the imposition of a lien on
any properties of the Company or any of its subsidiaries, or an
acceleration of any indebtedness of the Company or any of its
subsidiaries pursuant to, (1) the charter or bylaws of the Company or any
of its subsidiaries, (2) any bond, debenture, note, indenture, mortgage,
deed of trust or other agreement or instrument to which the Company or
any of its subsidiaries is a party or by which the Company or its
subsidiaries or their properties is or may be bound, (3) any material
statute, rule or regulation applicable to the Company or any of its
subsidiaries or any of their assets or properties or (4) any judgment,
order or decree of any court or governmental agency or authority having
jurisdiction over the Company or any of its subsidiaries or any of their
assets or properties. No consent, approval, authorization or order of, or
filing, registration, qualification, license or permit of or with, (A)
any court or governmental agency, body or administrative agency or (B)
any other person is required for (1) the execution, delivery and
performance by the Company of this Agreement or (2) the issuance and sale
of the Shares and the transactions contemplated hereby and thereby,
except such as have been or will be obtained and made on or prior to the
Closing Date under the Securities Act, the Exchange Act and state
securities or Blue Sky laws and regulations or such as may be required by
the National Association of Securities Dealers, Inc. (the "NASD").
(xiii) There is (A) no action, suit or proceeding before or by any
court, arbitrator or governmental agency, body or official, domestic or
foreign, now pending or, to the best knowledge of the Company, threatened
or contemplated to which the Company or any of its subsidiaries is a
party or to which the business or property of the Company or any of its
subsidiaries may be subject, (B) no statute, rule, regulation or order
that has been enacted, adopted or issued by any governmental agency or
that has been proposed by any governmental body and (C) no injunction,
restraining order or order of any nature by a federal or state court or
foreign court of competent jurisdiction to which the Company or any of
its subsidiaries is or may be subject or to which the business, assets,
or property of the Company or any of its subsidiaries are or may be
subject, that, in the case of clauses (A), (B) and (C) above, (1) is
required to be disclosed in the Prospectus and that is not so disclosed,
or (2) could reasonably be expected to result in a Material Adverse
Effect.
(xiv) To the Company's knowledge, no action has been taken and no
statute, rule, regulation or order has been enacted, adopted or issued by
any governmental agency that prevents the issuance of the Shares or
prevents or suspends the use of the Prospectus; no injunction,
restraining order or order of any nature by a federal or state court of
competent jurisdiction has been issued that prevents the issuance of the
Shares or prevents or suspends the sale of the Shares in any jurisdiction
referred to in Section 4(d) hereof; and every request made to the Company
by any securities authority or agency of any jurisdiction for additional
information has been complied with in all material respects.
(xv) The Company has delivered to the Underwriters or otherwise
made available to them true and correct copies of all material documents
and agreements, including all amendments. modifications or waivers
thereto, related to its subsidiaries, including XM Satellite
5
6
Radio Holdings, Inc. and XM Satellite Radio, Inc., and all such documents
and agreements are in effect, except as could not reasonably be expected
to have a Material Adverse Effect.
(xvi) The entities listed on Schedule II hereto are the only
material subsidiaries of the Company.
(xvii) To the best knowledge of the Company, no collective
bargaining organizing activities are taking place with respect to the
Company or any of its subsidiaries. None of the Company or any of its
subsidiaries has violated (A) any federal, state or local law or foreign
law relating to discrimination in hiring, promotion or pay of employees,
(B) any applicable wage or hour laws or (C) any provision of the Employee
Retirement Income Security Act of 1974, as amended ("ERISA"), or the
rules and regulations thereunder, except those violations, in the case of
(A), (B) or (C) that could not reasonably be expected to have a Material
Adverse Effect.
(xviii) None of the Company or any of its subsidiaries has
violated any foreign, federal, state or local law or regulation relating
to the protection of human health and safety, the environment or
hazardous or toxic substances or wastes, pollutants or contaminants
("Environmental Laws") except those violations that could not reasonably
be expected to have a Material Adverse Effect.
(xix) Each of the Company and its subsidiaries has such permits,
licenses, franchises and authorizations of governmental or regulatory
authorities ("permits"), including, without limitation, under any
applicable Environmental Laws, as are necessary to own, lease and operate
their respective properties and to conduct their businesses except where
the failure to have such permits could not reasonably be expected to
result in a Material Adverse Effect; except as set forth in the
Prospectus, each of the Company and its subsidiaries has fulfilled and
performed all of its obligations with respect to such permits and no
event has occurred which allows, or after notice or lapse of time would
allow, revocation or termination thereof or results in any other material
impairment of the rights of the holder of any such permit; and, except as
described in the Prospectus, such permits contain no restrictions that
are materially burdensome to the Company or such subsidiary, as the case
may be.
(xx) Each of the Company and its subsidiaries has (A) title to all
of the properties and assets described in the Prospectus as owned by it,
free and clear of all liens, charges, encumbrances and restrictions
(except for Permitted Liens (as defined in the indenture governing the
Company's 12 1/4% Senior Notes due 2008)), taxes not yet payable, and
general regulatory restrictions) except as could not reasonably be
expected to result in a Material Adverse Effect and (B) peaceful and
undisturbed possession under all material leases to which any of them is
a party as lessee and each of which lease is valid and binding and no
default exists thereunder, except for defaults that could not reasonably
be expected to have a Material Adverse Effect. All material leases to
which the Company or any of its subsidiaries is a party are valid and
binding and no default by the Company or such subsidiary, as the case may
be, has occurred and is continuing thereunder and, to the best knowledge
of the Company, no material defaults by the landlord are existing under
any such lease, except as could not reasonably be expected to have a
Material Adverse Effect.
(xxi) Except as disclosed in the Prospectus, each of the Company
and its subsidiaries owns, possesses or has the right to employ all
material patents, patent rights, licenses (including all FCC, state,
local or other jurisdictional regulatory licenses), inventions,
copyrights, know-
6
7
how (including trade secrets and other unpatented and/or unpatentable
proprietary or confidential information, software, systems or
procedures), trademarks, service marks and trade names, inventions,
computer programs, technical data and information (collectively, the
"Intellectual Property") presently employed by it in connection with the
businesses now operated by it or that are proposed to be operated by it
free and clear of and without violating any right, claimed right, charge,
encumbrance, pledge, security interest, restriction (other than
regulatory restrictions) or lien of any kind of any other person, and
none of the Company or any of its subsidiaries has received any notice of
infringement of or conflict with asserted rights of others with respect
to any of the foregoing, except as disclosed in the Prospectus. The use
of the Intellectual Property in connection with the business and
operations of the Company or any of its subsidiaries does not infringe on
the rights of any person, except as could not reasonably be expected to
have a Material Adverse Effect.
(xxii) All material tax returns required to be filed by the
Company or any of its subsidiaries in all jurisdictions have been so
filed, except where failure to so file could not reasonably be expected
to have a Material Adverse Effect. All taxes, including withholding
taxes, penalties and interest, assessments, fees and other charges due or
claimed to be due from such entities or that are due and payable have
been paid, other than those being contested in good faith and for which
adequate reserves have been provided or those currently payable without
penalty or interest. To the knowledge of the Company, there are no
material proposed additional tax assessments against the Company or any
of its subsidiaries, or the assets or property of the Company or any of
its subsidiaries, except those tax assessments for which adequate
reserves have been established.
(xxiii) Except as disclosed in the Prospectus, there are no
holders of securities of the Company or any of its subsidiaries who, by
reason of the execution by the Company of this Agreement to which it is a
party or the consummation by the Company or any of its subsidiaries of
the transactions contemplated hereby, have the right to request or demand
that the Company or any of its subsidiaries register under the Securities
Act or analogous foreign laws and regulations securities held by them.
(xxiv) Each of the Company and its subsidiaries maintains a system
of internal accounting controls sufficient to provide reasonable
assurance that: (A) transactions are executed in accordance with
management's general or specific authorizations; (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 thereto.
(xxv) The Company carries in-orbit insurance with respect to
MSAT-2. Except with respect to MSAT-2, each of the Company and its
subsidiaries maintains insurance covering its properties, operations,
personnel and businesses, insuring against such losses and risks as are
consistent with industry practice to protect the Company and its
subsidiaries and their respective businesses. None of the Company or any
of its subsidiaries has received notice from any insurer or agent of such
insurer that substantial capital improvements or other expenditures will
have to be made in order to continue such insurance.
7
8
(xxvi) None of the Company or any of its subsidiaries has (A)
taken, directly or indirectly, any action designed to, or that might
reasonably be expected to, cause or result in stabilization or
manipulation of the price of any security of the Company or any of its
subsidiaries to facilitate the sale or resale of the Common Stock or (B)
since the date of the Preliminary Prospectus (1) sold, bid for, purchased
or paid any person any compensation for soliciting purchases of the
Common Stock or (2) paid or agreed to pay to any person any compensation
for soliciting another to purchase any other securities of the Company or
any of its subsidiaries.
(xxvii) Subsequent to the respective dates as of which information
is given in the Prospectus and up to the Closing Date, except as set
forth in the Prospectus, (A) none of the Company or any of its
subsidiaries has incurred any liabilities or obligations, direct or
contingent, which are material, individually or in the aggregate, to the
Company and its subsidiaries, taken as a whole, nor entered into any
transaction not in the ordinary course of business, (B) there has not
been any change or development which, singly or in the aggregate, could
reasonably be expected to result in a Material Adverse Effect and (C)
there has been no dividend or distribution of any kind declared, paid or
made by the Company or its subsidiaries on any class of their capital
stock.
(xxviii) To the Company's knowledge, the accountants who have
certified or will certify the financial statements included or to be
included as part of the Prospectus are independent accountants as
required by the Securities Act. Except as expressly stated in the letters
delivered pursuant to Section 6(e) hereof, the historical financial
statements, including those incorporated by reference, together with
related schedules and notes thereto, comply as to form in all material
respects with the requirements applicable to registration statements on
Form S-3 under the Securities Act and under the Exchange Act, as
applicable and present fairly in all material respects the financial
position and results of operations of the Company and its subsidiaries,
at the dates and for the periods indicated. Such financial statements
have been prepared in accordance with generally accepted accounting
principles applied on a consistent basis throughout the periods
presented. The pro forma financial statements included in the Prospectus
have been prepared on a basis consistent with such historical statements
of the Company, except for the pro forma adjustments specified therein,
and give effect to assumptions made on a reasonable basis and present
fairly in all material respects the historical and proposed transactions
described in the Prospectus; and such pro forma financial statements
comply as to form in all material respects with the requirements
applicable to pro forma financial statements included in registration
statements on Form S-3 under the Securities Act, except as expressly
stated therein. The other financial and statistical information and data
included in the Prospectus, historical and pro forma, are accurately
presented in all material respects and prepared on a basis consistent
with the financial statements, historical and pro forma, included in the
Prospectus and the books and records of the Company and its subsidiaries.
(xxix) Except pursuant to this Agreement, there are no contracts,
agreements or understandings between the Company and any other person
that would give rise to a valid claim against the Company or any of the
Underwriters for a brokerage commission, finder's fee or like payment in
connection with the issuance, purchase and sale of the Shares.
(xxx) Each of the Company and its subsidiaries has implemented
Year 2000 compliance programs designed to ensure that its computer
systems and applications will function properly beyond 1999. The Company
believes that adequate resources have been allocated for
8
9
this purpose and expects the Company's and its subsidiaries' Year 2000
date conversion programs to be completed on a timely basis.
(xxxi) Each certificate signed by any officer of the Company and
delivered to the Underwriters or counsel for the Underwriters shall be
deemed to be a representation and warranty by the Company to the
Underwriters as to the matters covered thereby.
(b) Motorola represents and warrants to, and agrees with the
several Underwriters that:
(i) The execution, delivery and performance of this Agreement
by Motorola and the consummation of the transactions contemplated hereby
and thereby will not (A) conflict with or result in the breach of any of
the terms and provisions of, or constitute a default (or an event which
with notice or lapse of time, or both, would constitute a default) or
require consent under, or result in the creation or imposition of any
lien, charge or encumbrance upon any property or assets of Motorola
pursuant to the terms of, any agreement, instrument, franchise, license
or permit to which Motorola is a party or by which Motorola or any of its
property or assets may be bound, including, without limitation, the terms
of any trust or similar agreement under which Motorola was formed, or (B)
violate or conflict with any judgment, decree, order, statute, rule or
regulation of any court or any public, governmental or regulatory agency
or body having jurisdiction over Motorola or its properties or assets.
(ii) Motorola has, and will have at the time of delivery of the
Shares to be sold by it, full legal right, power, authority and capacity,
and, except as required under the Securities Act and state securities and
Blue Sky laws, all necessary consents, approvals, authorizations, orders,
registrations, filings, qualifications, licenses and permits of and from
all public, regulatory or governmental agencies and bodies, as are
required for the execution, delivery and performance of this Agreement
and the consummation of the transactions contemplated hereby and thereby,
including the sale, assignment, transfer and delivery of the Shares to be
sold, assigned, transferred and delivered by Motorola hereunder.
(iii) This Agreement has been duly and validly authorized,
executed and delivered by Motorola and, assuming the execution and
delivery by the other parties hereto and thereto, is the valid and
binding obligation of Motorola, enforceable against Motorola in
accordance with its terms, except as such enforceability may be limited
by bankruptcy, insolvency, reorganization, moratorium and other similar
laws relating to or affecting creditor's rights generally, by general
equitable principles (regardless of whether such enforceability is
considered in a proceeding in equity or at law) and as limited by the
unenforceability under certain circumstances under law or court decisions
of provisions providing for the indemnification of or contribution to a
party with respect to a liability where such indemnification or
contribution is contrary to public policy.
(iv) Motorola has good, valid and marketable title to the
Shares to be sold by it pursuant to this Agreement, free and clear of all
liens, encumbrances, adverse claims, security interests, restrictions on
transfer, shareholders' agreements, voting trusts, options and other
defects in title whatsoever, with full power to deliver such Shares
hereunder, and, upon the delivery of and payment for such Shares as
herein contemplated, each of the Underwriters will receive good, valid
and marketable title to the Shares purchased by it from Motorola, free
and clear of all liens, encumbrances, adverse claims, security interests,
restrictions on transfer, shareholders' agreements, voting trusts,
options and other defects in title whatsoever.
9
10
(v) None of Motorola or any of its subsidiaries has (A) taken,
directly or indirectly, any action designed to, or that might reasonably
be expected to, cause or result in stabilization or manipulation of the
price of any security of the Company or any of its subsidiaries to
facilitate the sale or resale of the Common Stock or (B) since the date
of the Preliminary Prospectus (1) sold, bid for, purchased or paid any
person any compensation for soliciting purchases of the Common Stock or
(2) paid or agreed to pay to any person any compensation for soliciting
another to purchase any other securities of the Company or any of its
subsidiaries.
(vi) Except as disclosed in the Prospectus, Motorola (A) does
not have any preemptive right, co-sale right or right of first refusal or
other similar right to purchase any of the Shares that are to be sold by
to the Underwriters pursuant to this Agreement, and (B) does not own any
warrants, options or similar rights to acquire, and does not have any
right or arrangement to acquire, any capital stock, rights, warrants,
options or other securities from the Company.
(vii) Except as disclosed in the Prospectus, Motorola does not
possess any registration rights with respect to any securities of the
Company or its subsidiaries.
The Company and Motorola acknowledge that each of the
Underwriters and, for purposes of the opinions to be delivered to the
Underwriters pursuant to Section 6 hereof, counsel to the Company, counsel to
Motorola and counsel to the Underwriters, will rely upon the accuracy and truth
of the foregoing representations and hereby consents to such reliance.
2. Purchase, Sale and Delivery of the Shares.
(a) On the basis of the representations, warranties, covenants
and agreements herein contained, but subject to the terms and conditions herein
set forth, the Company agrees to sell to the Underwriters and the Underwriters,
severally and not jointly, agree to purchase from the Company, at a purchase
price per share of $__, the number of Firm Shares set forth opposite the
respective names of the Underwriters in Schedule I hereto.
(b) Payment of the purchase price for, and delivery of
certificates for, the Firm Shares shall be made at the office of Xxxxxx &
Xxxxxxx, 000 Xxxxx Xxxxxx, Xxxxx 0000, Xxx Xxxx, Xxx Xxxx, 00000, or at such
other place as shall be agreed upon by the Underwriters and the Company, at
10:00 A.M. on July ___, 1999 (unless postponed in accordance with the provisions
of Section 9 hereof) after the determination of the public offering price of the
Firm Shares, or such other time not later than ten business days after such date
as shall be agreed upon by the Underwriters and the Company (such time and date
of payment and delivery being herein called the "Closing Date"). Payment shall
be made to the Company by wire transfer in same day funds, against delivery to
the Underwriters of certificates for the Shares to be purchased by them.
Certificates for the Firm Shares shall be registered in such name or names and
in such authorized denominations as the Underwriters may request in writing at
least two full business days prior to the Closing Date. The Company will permit
the Underwriters to examine and package such certificates for delivery at least
one full business day prior to the Closing Date.
(c) In addition, Motorola hereby grants to the Underwriters the
option to purchase up to 1,050,000 Additional Shares at the same purchase price
per share to be paid by the Underwriters to the Company for the Firm Shares as
set forth in this Section 2, for the sole purpose of covering over-allotments in
the sale of Firm Shares by the Underwriters. This option may be exercised
10
11
at any time, in whole or in part, on or before the thirtieth day following the
date of the Prospectus, by written notice by the Underwriters to Motorola. Such
notice shall set forth the aggregate number of Additional Shares as to which the
option is being exercised and the date and time, as reasonably determined by the
Underwriters, when the Additional Shares are to be delivered (such date and time
being herein sometimes referred to as the "Additional Closing Date"); provided,
however, that the Additional Closing Date shall not be earlier than the Closing
Date or earlier than the second full business day after the date on which the
option shall have been exercised nor later than the eighth full business day
after the date on which the option shall have been exercised (unless such time
and date are postponed in accordance with the provisions of Section 9 hereof).
Certificates for the Additional Shares shall be registered in such name or names
and in such authorized denominations as the Underwriters may request in writing
at least two full business days prior to the Additional Closing Date. Motorola
will permit the Underwriters to examine and package such certificates for
delivery at least one full business day prior to the Additional Closing Date.
(d) The number of Additional Shares to be sold to each
Underwriter shall be the number which bears the same ratio to the aggregate
number of Additional Shares being purchased as the number of Firm Shares set
forth opposite the name of such Underwriter in Schedule I hereto (or such number
increased as set forth in Section 9 hereof) bears to the total number of Firm
Shares being purchased from the Company, subject, however, to such adjustments
to eliminate any fractional shares as the Underwriters in their sole discretion
shall make.
(e) Payment for the Additional Shares shall be made by wire
transfer in same day funds payable to the order of Motorola at the office of
Xxxxxx & Xxxxxxx, 000 Xxxxx Xxxxxx, Xxxxx 0000, Xxx Xxxx, Xxx Xxxx, 00000, or
such other location as may be mutually acceptable, against delivery of the
certificates for the Additional Shares to the Underwriters.
3. Offering. Upon the Underwriters' authorization of the release
of the Firm Shares, the Underwriters propose to offer the Shares for sale to the
public upon the terms set forth in the Prospectus.
4. Covenants of the Company. The Company covenants and agrees with
each of the Underwriters that:
(a) The Company will notify the Underwriters as soon as
reasonably practicable (and, if requested by the Underwriters, will confirm such
notice in writing) (i) when any post-effective amendment to the Registration
Statement becomes effective, (ii) of any request by the Commission for any
amendment of or supplement to the Registration Statement or the Prospectus or
for any additional information, (iii) of the mailing or the delivery to the
Commission for filing of the Prospectus or any amendment of or supplement to the
Registration Statement or the Prospectus or any document to be filed pursuant to
the Exchange Act during any period when the Prospectus is required to be
delivered under the Securities Act, (iv) of the issuance by the Commission of
any stop order suspending the effectiveness of the Registration Statement or any
post-effective amendment thereto or of the initiation, or the threatening, of
any proceedings therefor, (v) of the receipt of any comments or inquiries from
the Commission, and (vi) of the receipt by the Company of any notification with
respect to the suspension of the qualification of the Shares for sale in any
jurisdiction or the initiation or threatening of any proceeding for that
purpose. If the Commission shall propose or enter a stop order at any time, the
Company will make every reasonable effort to prevent the issuance of any such
stop order and, if issued, to obtain the lifting of such order as soon as
possible. The Company will not file any post-effective
11
12
amendment to the Registration Statement or any amendment of or supplement to the
Prospectus (including any revised prospectus which the Company proposes for use
by the Underwriters in connection with the offering of the Shares which differs
from the prospectus filed with the Commission pursuant to Rule 424(b) of the
Securities Act Regulations, whether or not such revised prospectus is required
to be filed pursuant to Rule 424(b) of the Securities Act Regulations) to which
the Underwriters or Underwriters' Counsel (as hereinafter defined) shall
reasonably object, will furnish the Underwriters with copies of any such
amendment or supplement a reasonable amount of time prior to such proposed
filing or use, as the case may be, and will not file any such amendment or
supplement or use any such prospectus to which the Underwriters or counsel for
the Underwriters shall reasonably object.
(b) If any event shall occur as a result of which the
Prospectus would, in the judgment of the Underwriters or the Company, include an
untrue statement of a material fact or omit to state any material fact required
to be stated therein or necessary to make the statements therein, in the light
of the circumstances under which they were made, not misleading, or if it shall
be necessary at any time to amend or supplement the Prospectus or the
Registration Statement to comply with the Securities Act or the Securities Act
Regulations, the Company will notify the Underwriters promptly and prepare and
file with the Commission an appropriate amendment or supplement (in form and
substance satisfactory to the Underwriters) which will correct such statement or
omission or which will effect such compliance.
(c) The Company has delivered to the Underwriters five signed
copies of the Registration Statement as originally filed, including exhibits,
and all amendments thereto, and the Company will promptly deliver to each of the
Underwriters, from time to time during the period that the Prospectus is
required to be delivered under the Securities Act, such number of copies of the
Prospectus and the Registration Statement, and all amendments of and supplements
to such documents, if any, as the Underwriters may reasonably request.
(d) The Company will endeavor in good faith, in cooperation
with the Underwriters, to qualify the Shares for offering and sale under the
securities laws relating to the offering or sale of the Shares of such
jurisdictions as the Underwriters may designate and to maintain such
qualification in effect for so long as required for the distribution thereof;
except that in no event shall the Company be obligated in connection therewith
to qualify as a foreign corporation or to execute a general consent to service
of process.
(e) The Company will make generally available (within the
meaning of Section 11(a) of the Securities Act) to its security holders and to
the Underwriters as soon as practicable, but not later than 45 days after the
end of its fiscal quarter in which the first anniversary date of the effective
date of the Registration Statement occurs (or if such fiscal quarter is the
Company's fourth fiscal quarter, not later than 90 days after the end of such
quarter), an earnings statement (in form complying with the provisions of Rule
158 of the Regulations) covering a period of at least twelve consecutive months
beginning after the effective date of the Registration Statement (as defined in
Rule 158(c) under the Securities Act).
(f) Except as disclosed in the Prospectus, during the period of
120 days from the date of the Prospectus, the Company will not, directly or
indirectly, without the prior written consent of Bear, Xxxxxxx & Co. Inc. ("Bear
Xxxxxxx"), offer, sell, contract to sell, grant any option to purchase, pledge
or otherwise dispose (or announce any offer, sale, contract to sell, grant of an
option to purchase, pledge or other disposition) of any shares of Common Stock
of the
12
13
Company or any securities convertible into or exercisable or exchangeable for
such Common Stock, except that the Company may issue (i) shares of Common Stock
and options to purchase Common Stock under its 1989 Stock Option Plan (as such
term is defined in the Prospectus), (ii) shares of Common Stock upon exercise of
warrants to purchase Common Stock that were issued and outstanding on the date
of the Prospectus, (iii) shares to be issued to XM Ventures as described in the
Prospectus under the heading "The XM Radio Transactions" or (iv) shares of
Common Stock in connection with strategic relationships and acquisitions of
businesses, technologies and products complementary to those of the Company, so
long as the recipients of such shares agree to be bound by a lock-up agreement
substantially in the form of Exhibit E hereto (which shall provide that any
transferees and assigns of such recipients shall be bound by the lock-up
agreement) for the remainder of the 120-day lock-up period.
(g) During a period of three years from the date of the
Prospectus, the Company will furnish to the Underwriters copies of (i) all
reports to its stockholders; and (ii) all reports, financial statements and
proxy or information statements filed by the Company with the Commission or any
national securities exchange.
(h) The Company will apply the proceeds from the sale of the
Shares as set forth under "How We Intend to Use the Proceeds from the Offering"
in the Prospectus.
(i) If the Company elects to rely upon Rule 462(b), the Rule
462(b) Registration Statement shall have become effective by 10:00 P.M., New
York City time, on the date of this Agreement, no stop order suspending the
effectiveness of the Registration Statement or any part thereof shall have been
issued and no proceeding for that purpose shall have been initiated or
threatened by the Commission, and all requests for additional information on the
part of the Commission shall have been complied with to the Underwriters'
reasonable satisfaction.
(j) The Company, during the period when the Prospectus is
required to be delivered under the Securities Act or the Exchange Act, will file
all documents required to be filed with the Commission pursuant to Sections 13,
14 or 15 of the Exchange Act within the time periods required by the Exchange
Act and the rules and regulations thereunder.
5. Payment of Expenses. Whether or not the transactions
contemplated in this Agreement are consummated or this Agreement is terminated,
the Company hereby agrees to pay all costs and expenses incident to the
performance of the obligations of the Company hereunder, including those in
connection with (i) preparing, printing, duplicating, filing and distributing
the Registration Statement, as originally filed and all amendments thereto
(including all exhibits thereto), any Preliminary Prospectus, the Prospectus and
any amendments or supplements thereto (including, without limitation, fees and
expenses of the Company's accountants and counsel) and all other documents
related to the public offering of the Shares (including those supplied to the
Underwriters in quantities as hereinabove stated), (ii) the issuance, transfer
and delivery of the Shares to the Underwriters, including any transfer or other
taxes payable thereon, (iii) the qualification of the Shares under state or
foreign securities or Blue Sky laws, including the costs of printing and mailing
a preliminary and final "Blue Sky Memorandum" and the fees of counsel in
connection therewith and such counsel's disbursements in relation thereto, in an
amount not to exceed $7,500, (iv) listing of the Shares for quotation on the
Nasdaq, (v) filing fees of the Commission and the NASD, (vi) the cost of
printing certificates representing the Shares, and (vii) the cost and charges of
any transfer agent or registrar.
13
14
6. Conditions of Underwriters' Obligations. The obligations of the
Underwriters to purchase and pay for the Firm Shares and the Additional Shares,
as provided herein, shall be subject to the accuracy of the representations and
warranties of the Company and Motorola herein contained, as of the date hereof
and as of the Closing Date (for purposes of this Section 6, "Closing Date" shall
refer to the Closing Date for the Firm Shares and any Additional Closing Date,
if different, for the Additional Shares), to the absence from any certificates,
opinions, written statements or letters furnished to the Underwriters or to
Xxxxxx & Xxxxxxx ("Underwriters' Counsel") pursuant to this Section 6 of any
material misstatement or omission, to the performance by the Company and
Motorola of their obligations hereunder, and to the following additional
conditions:
(a) The Registration Statement shall have become effective not
later than 5:00 P.M., New York time, on the date of this Agreement or at
such later time and date as shall have been consented to by the
Underwriters, and shall continue to be effective; no stop order
suspending the effectiveness of the Registration Statement shall have
been issued under the Securities Act or proceedings therefor initiated
or, to the Company's knowledge, threatened by the Commission; the
Prospectus shall have been filed or transmitted for filing with the
Commission pursuant to Rule 424(b) of the Securities Act Regulations
within the prescribed time period; and prior to the Closing Date the
Company shall have provided evidence satisfactory to the Underwriters of
such timely filing or transmittal.
(b) All of the representations and warranties of the Company
and Motorola contained in this Agreement shall be true and correct on the
date hereof and on the Closing Date with the same force and effect as if
made on and as of the date hereof and the Closing Date, respectively. The
Company and Motorola shall have performed or complied with all of the
agreements herein contained and required to be performed or complied with
by them at or prior to the Closing Date.
(c) The Prospectus shall have been printed and copies
distributed to the Underwriters not later than 10:00 a.m., New York City
time, on the second business day following the date of this Agreement or
at such later date and time as to which the Underwriters may agree, and
no stop order suspending the qualification or exemption from
qualification of the Shares in any jurisdiction referred to in Section
4(d) shall have been issued and no proceeding for that purpose shall have
been commenced or shall be pending or threatened.
(d) No action shall have been taken and no statute, rule,
regulation or order shall have been enacted, adopted or issued by any
governmental agency which would, as of the Closing Date, prevent the
issuance of the Shares; no action, suit or proceeding shall have been
commenced and be pending against or affecting or, to the best knowledge
of the Company, threatened against, the Company or any of its
subsidiaries before any court or arbitrator or any governmental body,
agency or official that, if adversely determined, could reasonably be
expected to result in a Material Adverse Effect.
(e) Since the dates as of which information is given in the
Prospectus and except as contemplated by the Prospectus, (i) there shall
not have been any material adverse change, or any development that is
reasonably likely to result in a material adverse change, in the capital
stock or the long-term debt, or material increase in the short-term debt,
of the Company or any of its subsidiaries from that set forth in the
Prospectus, (ii) no dividend or distribution of any kind shall have been
declared, paid or made by the Company or any of its subsidiaries on any
class of its capital stock, (iii) neither the Company nor any of its
subsidiaries shall have incurred any
14
15
liabilities or obligations, direct or contingent, that are material,
individually or in the aggregate, to the Company and its subsidiaries,
taken as a whole, and that are required to be disclosed on a balance
sheet or notes thereto in accordance with generally accepted accounting
principles and are not disclosed on the latest balance sheet or notes
thereto included in the Prospectus. Since the date hereof and since the
dates as of which information is given in the Prospectus, there shall not
have occurred any material adverse change in the business, financial
condition or results of operations of the Company and its subsidiaries,
taken as a whole.
(f) The Underwriters shall have received (I) a certificate,
dated the Closing Date, signed on behalf of the Company by each of the
Company's Chief Executive Officer and Chief Financial Officer in form and
substance reasonably satisfactory to the Underwriters, confirming, as of
the Closing Date, the matters set forth in paragraphs (a) through (e) of
this Section 6 and that, as of the Closing Date, the obligations of the
Company to be performed hereunder on or prior thereto have been duly
performed in all material respects and (ii) a certificate, dated the
Closing Date, signed on behalf of the Company's Secretary, in form and
substance reasonably satisfactory to the Underwriters.
(g) The Underwriters shall have received on the Closing Date an
opinion, dated the Closing Date, in form and substance reasonably
satisfactory to the Underwriters and counsel to the Underwriters, of
Xxxxxx & Xxxxxx, counsel for the Company, to the effect set forth in
Exhibit A hereto.
(h) The Underwriters shall have received on the Closing Date an
opinion, dated the Closing Date, in form and substance reasonably
satisfactory to the Underwriters and counsel to the Underwriters, of
Xxxxxx Xxxxxxx Xxxxxx Leader & Xxxxxxxx L.L.P., counsel for the Company,
to the effect set forth in Exhibit B hereto.
(i) The Underwriters shall have received on the Closing Date an
opinion, dated the Closing Date, in form and substance reasonably
satisfactory to the Underwriters and counsel to the Underwriters, of
Xxxxx X. Xxxxx, General Counsel for the Company, to the effect set forth
in Exhibit C hereto.
(j) The Underwriters shall have on the Closing Date an opinion,
dated the Closing Date, in form and substance reasonably satisfactory to
the Underwriters and counsel to the Underwriters, of Xxxxx Xxxxxxx,
Senior Counsel to Motorola, to the effect set forth in Exhibit D hereto.
(k) The Underwriters shall have received an opinion, dated the
Closing Date, in form and substance reasonably satisfactory to the
Underwriters, of Xxxxxx & Xxxxxxx, counsel to the Underwriters, covering
such matters as are customarily covered in such opinions.
(l) Xxxxxx & Xxxxxxx shall have been furnished with such
documents, in addition to those set forth above, as they may reasonably
require for the purpose of enabling them to review or pass upon the
matters referred to in this Section 6 and in order to evidence the
accuracy, completeness or satisfaction in all material respects of any of
the representations, warranties or conditions herein contained.
(m) At the time this Agreement is executed and at the Closing
Date the Underwriters shall have received from each of Xxxxxx Xxxxxxxx
LLP, independent public
15
16
accountants for the Company and its subsidiaries, and KPMG LLP,
independent public accountants for XM Satellite Radio Holdings, Inc. and
XM Satellite Radio, Inc., dated as of the date of this Agreement and as
of the Closing Date, customary comfort letters addressed to the
Underwriters and in form and substance satisfactory to the Underwriters
and counsel to the Underwriters with respect to the financial statements
and certain financial information of the Company and its subsidiaries
contained in the Prospectus.
(n) At the time this Agreement is executed, the Underwriters
shall have received a "lock-up" agreement, substantially in the form
attached as Exhibit F hereto, from each of the officers and directors of
the Company identified on Exhibit G hereto.
(o) At the time this Agreement is executed, the Underwriters
shall have received a "lock-up" agreement, substantially in the form
attached as Exhibit H hereto, from each of Xxxxxx Communications
Satellite Services, Inc. and AT&T Wireless Services, Inc.
(p) At the time this Agreement is executed, the Underwriters
shall have received a "lock-up" agreement, substantially in the form
attached as Exhibit I hereto, from Motorola.
(q) At the Closing Date, the Shares shall have been approved
for quotation on the Nasdaq.
(r) At the time this Agreement is executed and at the Closing
Date, the NASD shall not have withdrawn, or given notice of an intention
to withdraw, its approval of the fairness of the underwriting terms and
arrangements of the Offering of the Shares by the Underwriters.
(s) All opinions, certificates, letters and other documents
required by this Section 6 to be delivered by the Company and Motorola
will be in compliance with the provisions hereof only if they are
reasonably satisfactory in form and substance to the Underwriters. The
Company and Motorola will furnish the Underwriters with such conformed
copies of such opinions, certificates, letters and other documents as
Bear Xxxxxxx shall reasonably request. Prior to the Closing Date, the
Company and Motorola shall have furnished to the Underwriters such
further information, certificates and documents as the Underwriters may
reasonably request.
If any of the conditions specified in this Section 6 shall not have been
fulfilled when and as required by this Agreement, or if any of the certificates,
opinions, written statements or letters furnished to the Underwriters or to
Underwriters' Counsel pursuant to this Section 6 shall not be in all material
respects reasonably satisfactory in form and substance to the Underwriters and
to Underwriters' Counsel, all obligations of the Underwriters hereunder may be
canceled by the Underwriters at, or at any time prior to, the Closing Date and
the obligations of the Underwriters to purchase the Additional Shares may be
canceled by the Underwriters at, or at any time prior to, the Additional Closing
Date. Notice of such cancellation shall be given to the Company and Motorola in
writing, or by telephone, telecopy, telex or telegraph, confirmed in writing.
7. Indemnification.
(a) The Company agrees to indemnify and hold harmless (i) each of
the Underwriters, (ii) each person, if any, who controls any of the Underwriters
within the meaning of Section 15 of the Securities Act or Section 20(a) of the
Exchange Act and (iii) the respective officers,
16
17
directors, partners, employees, representatives and agents of each of the
Underwriters or any controlling person to the fullest extent lawful, from and
against any and all losses, liabilities, claims, damages and expenses whatsoever
as incurred (including but not limited to reasonable attorneys' fees and any and
all expenses whatsoever incurred in investigating, preparing or defending
against any investigation or litigation, commenced or threatened, or any claim
whatsoever, and any and all amounts paid in settlement of any claim or
litigation), joint or several, to which they or any of them may become subject
under the Securities Act, the Exchange Act or otherwise, insofar as such losses,
liabilities, claims, damages or expenses (or actions in respect thereof) arise
out of or are based upon any untrue statement or alleged untrue statement of a
material fact contained in the Registration Statement, as originally filed or
any amendment thereof, or any related Preliminary Prospectus or the Prospectus,
or in any supplement thereto or amendment thereof, or arise out of or are based
upon the omission or alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements therein, in the light
of the circumstances under which they were made, not misleading; provided,
however, that the Company will not be liable in any such case (i) to the extent
but only to the extent that any such loss, liability, claim, damage or expense
arises out of or is based upon any such untrue statement or alleged untrue
statement or omission or alleged omission made therein in reliance upon and in
conformity with written information furnished to the Company by or on behalf of
any Underwriter expressly for use therein and (ii) with respect to any
Preliminary Prospectus or Preliminary Prospectus supplement to the extent that
any such loss, claim, damage or liability results from the fact that an
Underwriter sold Shares to a person as to whom it shall be established that
there was not sent or given, at or prior to written confirmation of such sale, a
copy of the Prospectus or Prospectus supplement as then amended or supplemented
in any case where such delivery is required by the Securities Act if the Company
has previously furnished copies thereof in sufficient quantity to such
Underwriter and with sufficient time to effect a recirculation pursuant to Rule
461 under the Securities Act and the loss, claim, damage or liability of the
Underwriters results from an untrue statement or omission of a material fact
contained in the Preliminary Prospectus or Preliminary Prospectus supplement
which was identified in writing prior to the effective date of the registration
statement to such underwriter and corrected in the Prospectus or Prospectus
supplement as then amended, and such correction would have cured the defect
giving rise to such loss, claim, damage or liability. The foregoing indemnity
shall be in addition to any liability which the Company may otherwise have.
(b) Motorola agrees to indemnify and hold harmless each
Underwriter, its directors, its officers and each person, if any, who controls
any Underwriter within the meaning of Section 15 of the Securities Act or
Section 20 of the Exchange Act to the same extent as the foregoing indemnity
from the Company to each Underwriter, but only with reference to information
relating to Motorola furnished in writing by or on behalf of Motorola expressly
for use in the Registration Statement, the Prospectus or any Preliminary
Prospectus. Notwithstanding the foregoing, the aggregate liability of Motorola
pursuant to the provisions of this paragraph shall be limited to an amount equal
to the total proceeds (before deducting underwriting discounts and commissions
and expenses) received by Motorola from the sale of Shares owned by it
hereunder.
(c) Each Underwriter, severally and not jointly, agrees to
indemnify and hold harmless (i) the Company and Motorola, (ii) each person, if
any, who controls the Company and Motorola within the meaning of Section 15 of
the Securities Act or Section 20(a) of the Exchange Act, and (iii) the
respective officers, directors, partners, employees, representatives and agents
of the Company and Motorola, against any losses, liabilities, claims, damages
and expenses whatsoever (including but not limited to reasonable attorneys' fees
and any and all expenses whatsoever incurred in investigating, preparing or
defending against any investigation or litigation, commenced or threatened, or
any claim whatsoever and any and all amounts paid in settlement of any claim or
litigation), joint or
17
18
several, to which they or any of them may become subject under the Securities
Act, the Exchange Act or otherwise, insofar as such losses, liabilities, claims,
damages or expenses (or actions in respect thereof) arise out of or are based
upon any untrue statement or alleged untrue statement of a material fact
contained in the Registration Statement, as originally filed or any amendment
thereof, or any related preliminary prospectus, preliminary prospectus
supplement or prospectus, or in any amendment thereof or supplement thereto, or
arise out of or are based upon the omission or alleged omission to state therein
a material fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading, in each case to the extent, but only to the extent, that
any such loss, liability, claim, damage or expense arises out of or is based
upon any such untrue statement or alleged untrue statement or omission or
alleged omission made therein in reliance upon and in conformity with written
information furnished to the Company by or on behalf of any Underwriter
expressly for use therein; provided, however, that in no case shall any
Underwriter be liable or responsible for any amount in excess of the
underwriting discount applicable to the Shares purchased by such Underwriter
hereunder. This indemnity will be in addition to any liability which any
Underwriter may otherwise have, including under this Agreement.
(d) Promptly after receipt by an indemnified party under
subsection (a), (b) or (c) above of notice of the commencement of any action,
such indemnified party shall, if a claim in respect thereof is to be made
against the indemnifying party under such subsection, notify each party against
whom indemnification is to be sought in writing of the commencement thereof (but
the failure so to notify an indemnifying party shall not relieve it from any
liability which it may have under this Section 7 except to the extent that it
has been prejudiced in any material respect by such failure or from any
liability which it may otherwise have). In case any such action is brought
against any indemnified party, and it notifies an indemnifying party of the
commencement thereof, the indemnifying party will be entitled to participate
therein, and to the extent it may elect by written notice delivered to the
indemnified party promptly after receiving the aforesaid notice from such
indemnified party, to assume the defense thereof with counsel reasonably
satisfactory to such indemnified party. Notwithstanding the foregoing, the
indemnified party or parties shall have the right to employ its or their own
counsel in any such case, but the fees and expenses of such counsel shall be at
the expense of such indemnified party or parties unless (i) the employment of
such counsel shall have been authorized in writing by the indemnifying parties
in connection with the defense of such action, (ii) the indemnifying parties
shall not have employed counsel to take charge of the defense of such action
within a reasonable time after notice of commencement of the action, or (iii)
such indemnified party or parties shall have reasonably concluded that there may
be defenses available to it or them which are different from or additional to
those available to one or all of the indemnifying parties (in which case the
indemnifying party or parties shall not have the right to direct the defense of
such action on behalf of the indemnified party or parties), in any of which
events such fees and expenses of counsel shall be borne by the indemnifying
parties; provided, however, that the indemnifying party under subsection (a),
(b) or (c) above, shall only be liable for the legal expenses of one counsel (in
addition to any local counsel) for all indemnified parties in each jurisdiction
in which any claim or action is brought. Anything in this subsection to the
contrary notwithstanding, an indemnifying party shall not be liable for any
settlement of any claim or action effected without its prior written consent;
provided, however, that such consent was not unreasonably withheld.
8. Contribution. In order to provide for contribution in
circumstances in which the indemnification provided for in Section 7 hereof is
for any reason held to be unavailable from any indemnifying party or is
insufficient to hold harmless a party indemnified thereunder, the Company and
Motorola (the "Sellers"), on the one hand, and each Underwriter, on the other
hand, shall contribute to the aggregate losses, claims, damages, liabilities and
expenses of the nature contemplated by such
18
19
indemnification provision (including any investigation, legal and other expenses
incurred in connection with, and any amount paid in settlement of, any action,
suit or proceeding or any claims asserted, but after deducting in the case of
losses, claims, damages, liabilities and expenses suffered by the Sellers any
contribution received by the Sellers from persons, other than the Underwriters,
who may also be liable for contribution, including persons who control the
Company within the meaning of Section 15 of the Securities Act or Section 20(a)
of the Exchange Act, officers of the Company who signed the Registration
Statement and directors of the Company) as incurred to which the Sellers and one
or more of the Underwriters may be subject, in such proportions as is
appropriate to reflect the relative benefits received by the Sellers, on the one
hand, and such Underwriter, on the other hand, from the offering of the Shares
or, if such allocation is not permitted by applicable law or indemnification is
not available as a result of the indemnifying party not having received notice
as provided in Section 7 hereof, in such proportion as is appropriate to reflect
not only the relative benefits referred to above but also the relative fault of
the Sellers, on the one hand, and the Underwriters, on the other hand, in
connection with the statements or omissions which resulted in such losses,
claims, damages, liabilities or expenses, as well as any other relevant
equitable considerations. The relative benefits received by the Sellers, on the
one hand, and each Underwriter, on the other hand, shall be deemed to be in the
same proportion as (x) the total proceeds from the offering (net of underwriting
discounts and commissions but before deducting expenses) received by the Sellers
and (y) the underwriting discounts and commissions received by the Underwriters,
respectively, in each case as set forth in the table on the cover page of the
Prospectus. The relative fault of the Sellers, on the one hand, and each
Underwriter, on the other hand, shall be determined by reference to, among other
things, whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by the Sellers or the Underwriters and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission. The Sellers and the Underwriters 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 Underwriters 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. Notwithstanding the
provisions of this Section 8, (i) in no case shall any Underwriter be liable or
responsible for any amount in excess of the underwriting discount applicable to
the Shares purchased by such Underwriter hereunder, and (ii) no person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. Notwithstanding the provisions of
this Section 8 and the preceding sentence, no Underwriter shall be required to
contribute any amount in excess of the amount by which the total price at which
the Shares underwritten by it and distributed to the public were offered to the
public exceeds the amount of any damages that such Underwriter has otherwise
been required to pay by reason of such untrue or alleged untrue statement or
omission or alleged omission. For purposes of this Section 8, (A) each person,
if any, who controls either of the Underwriters within the meaning of Section 15
of the Securities Act or Section 20(a) of the Exchange Act and (B) the
respective officers, directors, partners, employees, representatives and agents
of each of the Underwriters or any controlling person shall have the same rights
to contribution as such Underwriter, and (A) each person, if any, who controls
any of the Sellers within the meaning of Section 15 of the Securities Act or
Section 20(a) of the Exchange Act and (B) the respective officers, directors,
partners, employees, representatives and agents of the Sellers shall have the
same rights to contribution as the Sellers, subject in each case to clauses (i)
and (ii) of this Section 8. Any party entitled to contribution will, promptly
after receipt of notice of commencement of any action, suit or proceeding
against such party in respect of which a claim for contribution may be made
against another party or parties, notify each party or parties from whom
contribution may be sought, but the omission to so notify such party or parties
shall not relieve the party or parties from whom contribution may be sought from
any obligation it or they may have under this Section 8 or otherwise. No party
shall be liable for contribution with respect to any action or claim
19
20
settled without its prior written consent; provided, however, that such written
consent was not unreasonably withheld. Notwithstanding the foregoing, the
aggregate liability of Motorola pursuant to the provisions of this paragraph
shall be limited to an amount equal to the total proceeds (before deducting
underwriting discounts and commissions and expenses) received by Motorola from
the sale of its Shares hereunder.
9. Default by an Underwriter.
(a) If any Underwriter or Underwriters shall default in its or
their obligation to purchase Firm Shares or Additional Shares hereunder, and if
the Firm Shares or Additional Shares with respect to which such default relates
do not (after giving effect to arrangements, if any, made by the Underwriters
pursuant to Subsection (b) below) exceed in the aggregate 10% of the number of
Firm Shares or Additional Shares, the Firm Shares or Additional Shares which
such defaulting Underwriter or Underwriters agreed but failed or refused to
purchase shall be purchased by the non-defaulting Underwriters in proportion to
the respective proportions which the numbers of Firm Shares set forth opposite
their respective names in Schedule I hereto bear to the aggregate number of Firm
Shares set forth opposite the names of the non-defaulting Underwriters.
(b) In the event that such default relates to more than 10% of
the Firm Shares or Additional Shares, as the case may be, the Underwriters may
in their discretion arrange for themselves or for another party or parties
(including any non-defaulting Underwriter or Underwriters who so agree) to
purchase such Firm Shares or Additional Shares, as the case may be, to which
such default relates on the terms contained herein. In the event that within
five calendar days after such a default the Underwriters do not arrange for the
purchase of the Firm Shares or Additional Shares, as the case may be, to which
such default relates as provided in this Section 9, this Agreement, or in the
case of a default with respect to the Additional Shares, the obligations of the
Underwriters to purchase and of the Company to sell the Additional Shares, shall
thereupon terminate, without liability on the part of the Company with respect
thereto (except in each case as provided in Section 5, 7(a) and 8 hereof) or the
Underwriters, but nothing in this Agreement shall relieve a defaulting
Underwriter or Underwriters of its or their liability, if any, to the other
Underwriters and the Company for damages occasioned by its or their default
hereunder.
(c) In the event that the Firm Shares or Additional Shares to
which the default relates are to be purchased by the non-defaulting
Underwriters, or are to be purchased by another party or parties as aforesaid,
the Underwriters or the Company shall have the right to postpone the Closing
Date or Additional Closing Date, as the case may be, for a period not exceeding
five business days, in order to effect whatever changes may thereby be made
necessary in the Registration Statement or the Prospectus or in any other
documents and arrangements, and the Company agrees to file promptly any
amendment or supplement to the Registration Statement or the Prospectus which,
in the opinion of Underwriters' Counsel, may thereby be made necessary or
advisable. The term "Underwriter" as used in this Agreement shall include any
party substituted under this Section 9 with like effect as if it had originally
been a party to this Agreement with respect to such Firm Shares or Additional
Shares.
10. Survival of Representations and Agreements. All
representations and warranties, covenants and agreements of the Underwriters,
the Company and Motorola contained in this Agreement, including the agreements
contained in Section 5, the indemnity agreements contained in Section 7 and the
contribution agreements contained in Section 8, shall remain operative and in
full force and effect regardless of any investigation made by or on behalf of
any Underwriter or any controlling person thereof or by or on behalf of the
Company or Motorola, any of their officers and directors, or any
20
21
of their controlling persons, and shall survive delivery of and payment for the
Shares to and by the Underwriters. The representations contained in Section 1
and the agreements contained in Sections 5, 7, 8, 11(d) and 12 hereof shall
survive the termination of this Agreement, including termination pursuant to
Section 9 or 11 hereof.
11. Effective Date of Agreement; Termination.
(a) This Agreement shall become effective upon the execution
and delivery of a counterpart hereof by each of the parties hereto.
(b) The Underwriters shall have the right to terminate this
Agreement at any time prior to the Closing Date or the obligations of the
Underwriters to purchase the Additional Shares at any time prior to the
Additional Closing Date, as the case may be, if on or prior to such date, (i)
either of the Company or Motorola shall have failed, refused or been unable to
perform in any material respect any agreement on its part to be performed
hereunder, (ii) any other condition to the obligations of the Underwriters
hereunder as provided in Section 6 is not fulfilled when and as required in any
material respect, (iii) in the judgment of the Underwriters any changes of
circumstance shall have occurred since the respective dates as of which
information is given in the Prospectus which could have a Material Adverse
Effect, other than as set forth in the Prospectus, or (iv) (A) any domestic or
international event or act or occurrence has materially adversely effected, or
in the opinion of the Underwriters will in the immediate future materially
adversely effect, the market for the Company's securities or for securities in
general; or (B) trading in securities generally on the New York Stock Exchange
("NYSE") or quotations on the Nasdaq shall have been suspended or materially
limited, or minimum or maximum prices for trading shall have been established,
or maximum ranges for prices for securities shall have been required, on such
exchange, or by such exchange or other regulatory body or governmental authority
having jurisdiction; or (C) a banking moratorium shall have been declared by
federal or state authorities, or a moratorium in foreign exchange trading by
major international banks or persons shall have been declared; or (D) there is
an outbreak or escalation of armed hostilities involving the United States on or
after the date hereof, or if there has been a declaration by the United States
of a national emergency or war, the effect of which shall be, in the
Underwriters' judgment, to make it inadvisable or impracticable to proceed with
the offering, sale and delivery of the Firm Shares or the Additional Shares, as
the case may be, on the terms and in the manner contemplated by the Prospectus;
or (E) there shall have been such a material adverse change in general economic,
political or financial conditions or if the effect of international conditions
on the financial markets in the United States shall be such as, in the
Underwriters' judgment, makes it inadvisable or impracticable to proceed with
the offering, sale and delivery of the Firm Shares or the Additional Shares, as
the case may be, on the terms and in the manner contemplated by the Prospectus.
(c) Any notice of termination pursuant to this Section 11 shall
be by telephone, telecopy, telex, or telegraph, confirmed in writing by letter.
(d) If this Agreement shall be terminated pursuant to any of
the provisions hereof (other than pursuant to Section 9(b) or 11(b) hereof), or
if the sale of the Shares provided for herein is not consummated because any
condition to the obligations of the Underwriters set forth herein is not
satisfied or because of any refusal, inability or failure on the part of the
Company to perform any agreement herein or comply with any provision hereof, the
Company will, subject to demand by the Underwriters, reimburse the Underwriters
for all out-of-pocket expenses (including the reasonable fees and expenses of
their counsel) incurred by the Underwriters in connection herewith.
21
22
(e) If the sale of the Additional Shares provided for herein is
not consummated because any condition to the obligations of the Underwriters set
forth herein is not satisfied or because of any refusal, inability or failure on
the part of Motorola to perform any agreement herein or comply with any
provision hereof, Motorola will, subject to demand by the Underwriters,
reimburse the Underwriters for all out-of-pocket expenses (including the
reasonable fees and expenses of their counsel) incurred by the Underwriters in
connection therewith.
12. Underwriters' Information. The Company, Motorola and the
Underwriters severally acknowledge that the statements set forth in (i) the last
paragraph of the outside front cover of the Prospectus concerning the delivery
of the shares of Common Stock to the Underwriters and the offering of such
shares by the Underwriters; (ii) the fourth paragraph under the caption
"Underwriting" in the Prospectus concerning the proposed public offering price,
discount and concession; and (iii) the seventh and eighth paragraphs under the
caption "Underwriting" in the Prospectus concerning transactions that stabilize,
maintain, or otherwise affect the price of the Common Stock, constitute the only
information furnished in writing by or on behalf of any Underwriter expressly
for use in the Registration Statement, as originally filed or in any amendment
thereof, any related Preliminary Prospectus or preliminary prospectus supplement
or the Prospectus or in any amendment thereof or supplement thereto, as the case
may be.
13. Notices. All communications hereunder, except as may be
otherwise specifically provided herein, shall be in writing and, if sent to the
Underwriters shall be mailed, delivered, telegraphed or telecopied to the
Underwriters, c/o Bear, Xxxxxxx & Co. Inc., 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000, Attention: Corporate Finance Department, telecopy number: (000) 000-0000,
with a copy to Xxxxxx & Xxxxxxx, 000 Xxxxx Xxxxxx, Xxxxx 0000, Xxx Xxxx, Xxx
Xxxx 00000, Attention: Xxxxxxx X. Xxxxxx, telecopy number: (000) 000-0000; and
if sent to the Company, shall be mailed, delivered, telexed, telegraphed or
telecopied to American Mobile Satellite Corporation, 00000 Xxxxxxxxx Xxxxxxxxx,
Xxxxxx, Xxxxxxxx 00000, Attention: Xxxxx X. Xxxxx, Senior Vice-President,
General Counsel and Secretary, telecopy number: (000) 000-0000, with a copy to
Xxxxxx & Xxxxxx, 000 Xxxxxxx Xxxxxx, Xxxxxxxxxx, X.X. 00000, Attention: Xxxxxxx
X. Xxxxx, telecopy number: (000) 000-0000; and if sent to Motorola, shall be
mailed, delivered, telexed, telegraphed or telecopied to Motorola, Inc., 0000
Xxxx Xxxxxxxxx Xxxx, Xxxxxxxxxx, Xxxxxxxx 00000, Attention: General Counsel,
telecopy number: (000) 000-0000; provided, however, that any notice pursuant to
Sections 7 or 8 shall be mailed, delivered, telegraphed or telecopied and
confirmed in writing.
14. Parties. This Agreement shall inure solely to the benefit of,
and shall be binding upon, the Underwriters, the Company, Motorola and the
controlling persons, directors, officers, employees and agents referred to in
Section 7 and 8, and their respective successors and assigns, and no other
person shall have or be construed to have any legal or equitable right, remedy
or claim under or in respect of or by virtue of this Agreement or any provision
herein contained. The term "successors and assigns" shall not include a
purchaser, in its capacity as such, of Shares from any of the Underwriters.
15. Construction. This Agreement shall be construed in accordance
with the internal laws of the State of New York applicable to agreements made
and to be performed within New York, without giving any effect to any provisions
thereof relating to conflicts of law. TIME IS OF THE ESSENCE IN THIS AGREEMENT.
16. Captions. The captions included in this Agreement are included
solely for convenience of reference and are not to be considered a part of this
Agreement.
22
23
17. Counterparts. This Agreement may be executed in various
counterparts which together shall constitute one and the same instrument.
23
24
If the foregoing correctly sets forth the understanding among the
Underwriters, the Company and Motorola, please so indicate in the space provided
below for that purpose, whereupon this letter shall constitute a binding
agreement among us.
Very truly yours,
AMERICAN MOBILE SATELLITE CORPORATION
By:
----------------------------------
Name:
Title:
MOTOROLA, INC.
By:
----------------------------------
Name:
Title:
Accepted as of the date first above written
BEAR, XXXXXXX & CO. INC.
Acting on behalf of itself and the several
Underwriters named in Schedule I hereto
BEAR, XXXXXXX & CO. INC.
By:
----------------------------------
Name:
Title:
25
SCHEDULE I
Number of Firm
Name of Underwriter Shares to be Purchased
------------------------------------------------------------------------------------------------------
Bear, Xxxxxxx & Co. Inc. ...........................................................................
Credit Suisse First Boston Corporation..............................................................
Deutsche Bank Securities Inc........................................................................
SoundView Technology Group..........................................................................
[others]............................................................................................
....................................................................................................
....................................................................................................
Total..........................................................................................
26
SCHEDULE II
Material Subsidiaries
AMSC Acquisition Company, Inc.
AMSC Subsidiary Corporation
XM Satellite Radio Holdings, Inc.
27
Exhibit A
FORM OF OPINION OF XXXXXX & XXXXXX
1. The Company has all requisite corporate power and authority to
execute, deliver and perform its obligations under the Underwriting Agreement
and to consummate the transactions contemplated thereby and in the Prospectus
under the heading "The XM Radio Transactions," including, without limitation,
the corporate power and authority to issue, sell and deliver the Shares as
provided therein.
2. The Underwriting Agreement has been duly and validly authorized,
executed and delivered by the Company, and is the valid and binding obligation
of the Company, enforceable against the Company in accordance with its terms.
3. The Registration Statement, Preliminary Prospectus and Prospectus
comply as to form in all material respects with the requirements for
registration statements on Form S-3 under the Securities Act and the Securities
Act Regulations; it being understood, however, that such counsel need not
express an opinion with respect to the financial statements, schedules and other
financial and market data included in the Registration Statement, Preliminary
Prospectus or Prospectus.
4. To such counsel's knowledge, there are no contracts or other
agreements of a character required to be filed as an exhibit to the Registration
Statement that are not so filed.
5. The Registration Statement has become effective under the Securities
Act and, to the best knowledge of such counsel, no stop order suspending the
effectiveness of the Registration Statement has been issued and no proceedings
therefor have been initiated or threatened by the Commission and all filings
required by Rule 424(b) of the Regulations have been made.
6. None of (A) the execution, delivery or performance by the Company of
the Underwriting Agreement, (B) the issuance and sale of the Shares or (C) the
consummation by the Company of the transactions described in the Prospectus
under the caption "How We Intend to Use the Proceeds from the Offering" and "The
XM Radio Transactions" violates, conflicts with or constitutes a breach of any
of the terms or provisions of, or a default under (or an event that with notice
or the lapse of time, or both, would constitute a default), or requires consent
under, or results in the imposition of a lien or encumbrance on any properties
of the Company or any of its subsidiaries, or an acceleration of any
indebtedness of the Company or any of its subsidiaries pursuant to, (i) the
charter or bylaws of the Company or any of its subsidiaries, (ii) any bond,
debenture, note, indenture, mortgage, deed of trust or other agreement or
instrument to which the Company or any of its subsidiaries is a party or by
which any of them or their property is or may be bound that has been filed or
incorporated by reference as an exhibit to any filing by the Company with the
Securities and Exchange Commission, (iii) and statute, rule or regulation
applicable to the Company or any of its subsidiaries or any of their assets or
properties or (iv) to the best of our knowledge, any judgment, order or decree
of any court or governmental agency or authority having jurisdiction over the
Company or any of its subsidiaries or any of their assets or properties, except
as would not, individually or in the aggregate, have a material adverse effect.
Assuming compliance with applicable state securities and Blue Sky Laws and
Federal Communications Commission law, as to which we express no opinion, no
consent, approval, authorization or order of, or filing, registration or
qualification of or with, (a) any court or governmental agency, body or
administrative agency or (b) any other person is required for (1) the execution,
delivery and performance by the Company of the Underwriting Agreement, (2) the
issuance and sale of the Shares or (3)
28
consummation by the Company of the transactions described in the Prospectus
except such as have been obtained and made or have been disclosed in the
Prospectus, and except as would not, individually or in the aggregate, have a
material adverse effect
7. The statements contained in the Prospectus under the captions "Certain
Relationships and Related Transactions" and "Description of Capital Stock", in
each case insofar as such statements constitute statements of law, descriptions
of statutes, rules or regulations or legal conclusions, summarize fairly in all
material respects the matters required to be disclosed therein.
8. None of the Company or any of its subsidiaries is an "investment
company" or a company "controlled" by an investment company within the meaning
of the Investment Company Act.
Such counsel shall state in a separate letter:
We have participated in conferences with officers and other
representatives of the Company, representatives of the independent certified
public accountants of the Company and the Underwriters and their representatives
at which the contents of the Registration Statement, Preliminary Prospectus and
Prospectus and related matters were discussed and, although we have not
undertaken to investigate or verify independently, and do not assume any
responsibility for, the accuracy, completeness or fairness of the statements
contained in the Registration Statement, Preliminary Prospectus or Prospectus
(except as indicated above), on the basis of the foregoing, no facts have come
to our attention which led us to believe that the Registration Statement,
Preliminary Prospectus and Prospectus, as of its date or the Closing Date,
contained an 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, in the light of the circumstances under which they were made, not
misleading (except as to financial statements and related notes, the financial
statement schedules and other financial and statistical data included therein).
29
Exhibit B
FORM OF OPINION OF XXXXXX XXXXXXX XXXXXX LEADER & XXXXXXXX L.L.P.
1. Except as set forth in the Prospectus, the (i) the FCC has granted the
Company all material authorizations needed to construct, launch, and operate a
mobile satellite system and offer, on a common carrier basis, a variety of
domestic and international mobile satellite communications services, including
aeronautical, maritime and land mobile services pursuant to such authorization,
(ii) the FCC has assigned the Company an orbital location at 101 degrees X.X.
for the Company's first satellite and frequency bands 1544 to 1559 MHz and
1645.5 to 1660.5 MHz to provide further authorized mobile satellite services,
(iii) the FCC has granted XM Satellite Radio Holdings, Inc. ("XM") all material
authorizations needed to construct, launch, and operate a satellite radio
service and offer a subscription service on a non-common carrier basis, and (iv)
the FCC has assigned XM two orbital locations at _____ and _____ to provide such
satellite radio service.
2. Except as set forth in the Prospectus, the FCC has granted the Company
all material authorizations needed to construct and operate a two-way wireless
data network and offer, on a common carrier basis, a variety of two-way wireless
data services.
3. Except for such FCC consents, approvals, authorizations or orders that
have already been obtained, no material consent, approval, authorization or
order of the FCC is required to be obtained by the Company or its subsidiaries
under the Communications Laws for the consummation of the transactions
contemplated under the Underwriting Agreement, except that, from time to time,
the Company and its subsidiaries may be required to obtain certain
authorizations that would be required in the ordinary course of business.
4. The execution and delivery of the Underwriting Agreement, and the
consummation of the transactions contemplated thereunder, by the Company do not
and will not violate any material provision of the Communications Laws.
5. The statements set forth in the Prospectus under the captions "RISK
FACTORS--Our wireless business is subject to domestic and international
regulation which could impose significant costs or otherwise harm our business,
"RISK FACTORS--XM Radio's business involves significant risks and these risks
may impair the value of our investment in XM Radio--Oversight by the FCC and
other regulatory bodies involves costs and risks" and "REGULATION," insofar as
such statements constitute a summary of material (a) legal matters, (b)
documents, or (c) proceedings under the Communications laws, fairly present the
information contained under such captions in light of the circumstances in which
they were made.
6. Except as set forth in the Prospectus, to our knowledge, there is no
investigation or complaint before the FCC pending or threatened in writing that
is specifically directed against or in respect of the Company or its
subsidiaries (including XM Satellite Radio Holdings, Inc.), or any of the FCC
licenses held by the Company or its subsidiaries (including XM Satellite Radio
Holdings, Inc.) that would reasonably be expected to result in the revocation of
any material FCC authorizations or otherwise to materially impair the operations
of the Company or its subsidiaries (including XM Satellite Radio Holdings,
Inc.).
30
Exhibit C
FORM OF OPINION OF XXXXX X. XXXXX, GENERAL COUNSEL TO AMERICAN MOBILE SATELLITE
CORPORATION
1. Each of the Company and its subsidiaries is duly organized and validly
existing as a corporation in good standing under the laws of its jurisdiction of
incorporation, and has all requisite corporate power and authority to carry on
its business as it is being conducted and as described in the Prospectus and to
own, lease and operate its properties, and is duly qualified and in good
standing as a foreign corporation authorized to do business in each jurisdiction
in which the nature of its business or its ownership or leasing of property
requires such qualification, except where the failure to be so qualified or in
good standing would not, singly or in the aggregate, have a Material Adverse
Effect.
2. All of the outstanding shares of capital stock of the Company have
been duly authorized, validly issued, and are fully paid and nonassessable and
were not issued in violation of any preemptive or similar rights under the
Delaware General Corporation Law. The authorized, issued and outstanding capital
stock of the Company conforms in all respects to the description thereof set
forth in the Prospectus.
3. Except as disclosed in the Prospectus, all of the outstanding capital
stock of each subsidiary of the Company is owned by the Company, free and clear
of any security interest, claim, lien, limitation on voting rights or
encumbrance; and all such securities have been duly authorized, validly issued,
and are fully paid and nonassessable and were not issued in violation of any
preemptive or similar rights.
4. The Company has all requisite corporate power and authority to
execute, deliver and perform its obligations under the Underwriting Agreement
and to consummate the transactions contemplated thereby and in the Prospectus,
including, without limitation, the corporate power and authority to issue, sell
and deliver the Shares as provided in the Underwriting Agreement and in the
Prospectus.
5. The Underwriting Agreement has been duly and validly authorized,
executed and delivered by the Company and, assuming due execution by the other
parties thereto, is the legally valid and binding agreement of the Company.
6. Except as described in the Prospectus, none of (A) the execution,
delivery or performance by the Company of the Underwriting Agreement, (B) the
issuance and sale of the Shares or (C) the consummation by the Company of the
transactions described in the Prospectus under the caption "How We Intend to Use
the Proceeds from the Offering" violates, conflicts with or constitutes a breach
of any of the terms or provisions of, or a default under (or an event that with
notice or the lapse of time, or both, would constitute a default), or requires
consent under, or results in the imposition of a lien or encumbrance on any
properties of the Company or any of its subsidiaries, or an acceleration of any
indebtedness of the Company or any of its subsidiaries pursuant to, (i) the
charter or bylaws of the Company or any of its subsidiaries, (ii) any bond,
debenture, note, indenture, mortgage, deed of trust or other agreement or
instrument to which the Company or any of its subsidiaries is a party or by
which any of them or their property is or may be bound (assuming all of such
agreements are governed by New York law), (iii) any statute, rule or regulation
applicable to the Company or any of its subsidiaries or any of their assets or
properties or (iv) to the best of my knowledge, any judgment, order or decree of
any court or governmental agency or authority having jurisdiction over the
Company or any of its subsidiaries or any of their assets or properties.
Assuming compliance with applicable state securities
31
and Blue Sky laws, as to which I express no opinion, and the filing of a
registration statement under the Securities Act of 1933, no consent, approval,
authorization or order of, or filing, registration, qualification, license or
permit of or with, any court or governmental agency, body or administrative
agency is required for (1) the execution, delivery and performance by the
Company of the Underwriting Agreement, (2) the issuance and sale of the Shares
or (3) the consummation by the Company of the transactions contemplated by the
Underwriting Agreement and in the Prospectus under the heading "The XM Radio
Transactions," except such as have been obtained and made or have been disclosed
in the Prospectus.
7. To the best of my knowledge, there is (a) no action, suit,
investigation or proceeding before or by any court, arbitrator or governmental
agency, body or official, domestic or foreign, now pending, or threatened or
contemplated to which any of the Company or any of its subsidiaries is or may be
a party or to which the business or property of any of the Company or any of its
subsidiaries is or may be subject, (b) no statute, rule, regulation or order
that has been enacted, adopted or issued by any governmental agency or that has
been proposed by any governmental body, or (c) no injunction, restraining order
or order of any nature by a federal or state court of competent jurisdiction to
which any of the Company or any of its subsidiaries is or may be subject or to
which the business, assets or property of the Company or any of its subsidiaries
is or may be subject, that, in the case of clauses (a), (b) and (c) above, is
required to be disclosed in the Prospectus and that is not so disclosed.
8. To the best of my knowledge, except as set forth in the Prospectus,
there are no holders of any securities of the Company or any of its subsidiaries
who, by reason of the execution by the Company of the Underwriting Agreement or
the consummation by the Company of the transactions contemplated thereby, have
the right to request or demand that the Company register under the Securities
Act securities held by them.
9. To the best of my knowledge, no stop order preventing the use of the
Preliminary Prospectus or the Prospectus, or any amendment or supplement
thereto, has been issued.
32
Exhibit D
FORM OF OPINION OF COUNSEL TO MOTOROLA
1. Motorola is duly organized and validly existing as a corporation in
good standing under the laws of its jurisdiction of incorporation.
2. The Underwriting Agreement has been duly and validly authorized,
executed and delivered by Motorola and is a valid and binding obligation of
Motorola, enforceable against Motorola in accordance with its terms.
3. Motorola has all requisite power and authority, and all necessary
consents, approvals, authorizations, orders, registrations, filings,
qualifications, licenses and permits of and from all courts and all public,
governmental or regulatory agencies and bodies as are required for the
execution, delivery and performance of the Underwriting Agreement and the
consummation of the transactions contemplated hereby and thereby, except for (1)
such as may be required under state securities or Blue Sky laws in connection
with the purchase and distribution of the Shares by the Underwriters (as to
which such counsel need express no opinion) and (2) such as have been made or
obtained under the Securities Act.
4. Upon the delivery of and payment for the Shares to be sold by Motorola
pursuant to the Underwriting Agreement as herein contemplated, each of the
Underwriters will receive all rights and interests in and to the Shares
purchased by it from Motorola, free of any adverse claim.
5. The execution, delivery and performance of the Underwriting Agreement
by Motorola and the consummation of the transactions contemplated hereby and
thereby will not violate or conflict with, to the knowledge of such counsel, any
judgment, decree, order, statute, rule or regulation of any court or any public,
governmental or regulatory agency or body having jurisdiction over Motorola or
any of its properties or assets.
33
Exhibit E
American Mobile Satellite Corporation
00000 Xxxxxxxxx Xxxxxxxxx
Xxxxxx, Xxxxxxxx 00000
LOCK-UP AGREEMENT
Bear, Xxxxxxx & Co. Inc.
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
The undersigned is a holder of securities of American Mobile Satellite
Corporation, a Delaware corporation (the "Company"), and wishes to facilitate
the public offering (the "Offering") of the Company's common stock, par value
$.01 per share (the "Common Stock"), pursuant to a Registration Statement on
Form S-3 (File No. 333-81549). The undersigned recognizes that the Offering will
be of benefit to the undersigned.
In consideration of the foregoing and in order to induce you to act as
Underwriter in connection with the Offering, the undersigned hereby agrees, for
the benefit of the Company and the Underwriter, that during the period beginning
from the date hereof and continuing to and including the date 120 days after the
date of the final prospectus relating to the Offering, the undersigned will not,
directly or indirectly, without the prior written consent of Bear, Xxxxxxx & Co.
Inc., offer, sell, contract to sell, swap, make any short sale, pledge,
establish an open "put equivalent position" within the meaning of Rule 16a-1(h)
under the Securities Exchange Act of 1934, as amended (the "Exchange Act"),
grant any option to purchase or otherwise dispose (or publicly announce the
undersigned's intention to do any of the foregoing) of, directly or indirectly,
any shares of Common Stock or other capital stock of the Company, or any
securities convertible into, or exercisable or exchangeable for, any shares of
Common Stock or other capital stock of the Company that the undersigned
currently beneficially owns (within the meaning of Rule 13d-3 under the Exchange
Act), directly or indirectly, or may beneficially own, directly or indirectly,
in the future.
The undersigned confirms that the undersigned understands that the
Underwriter and the Company will rely upon the representations set forth in this
Agreement in proceeding with the Offering. The undersigned further confirms that
the agreements of the undersigned are irrevocable and shall be binding upon the
undersigned's heirs, legal representatives, successors and assigns. The
undersigned agrees and consents to the entry of stop transfer instructions with
the Company's transfer agent against the transfer of securities of the Company
held by the undersigned except in compliance with this Agreement.
Very truly yours,
By:
---------------------------
Name:
Title:
Dated: July ___, 1999
34
Exhibit F
American Mobile Satellite Corporation
00000 Xxxxxxxxx Xxxxxxxxx
Xxxxxx, Xxxxxxxx 00000
LOCK-UP AGREEMENT
Bear, Xxxxxxx & Co. Inc.
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
The undersigned is a holder of securities of American Mobile Satellite
Corporation, a Delaware corporation (the "Company"), and wishes to facilitate
the public offering (the "Offering") of the Company's common stock, par value
$.01 per share (the "Common Stock"), pursuant to a Registration Statement on
Form S-3 (File No. 333-81549). The undersigned recognizes that the Offering will
be of benefit to the undersigned.
In consideration of the foregoing and in order to induce you to act as
Underwriter in connection with the Offering, the undersigned hereby agrees, for
the benefit of the Company and the Underwriter, that during the period beginning
from the date hereof and continuing to and including the date 90 days after the
date of the final prospectus relating to the Offering, the undersigned will not,
directly or indirectly, without the prior written consent of Bear, Xxxxxxx & Co.
Inc., offer, sell, contract to sell, swap, make any short sale, pledge,
establish an open "put equivalent position" within the meaning of Rule 16a-1(h)
under the Securities Exchange Act of 1934, as amended (the "Exchange Act"),
grant any option to purchase or otherwise dispose (or publicly announce the
undersigned's intention to do any of the foregoing) of, directly or indirectly,
any shares of Common Stock or other capital stock of the Company, or any
securities convertible into, or exercisable or exchangeable for, any shares of
Common Stock or other capital stock of the Company that the undersigned
currently beneficially owns (within the meaning of Rule 13d-3 under the Exchange
Act), directly or indirectly, or may beneficially own, directly or indirectly,
in the future; provided, however, that the foregoing 90-day restriction shall
not apply to 401(k) benefit plan transfers and shall only be applicable for so
long as the undersigned is an employee of the Company.
The undersigned confirms that the undersigned understands that the
Underwriter and the Company will rely upon the representations set forth in this
Agreement in proceeding with the Offering. The undersigned further confirms that
the agreements of the undersigned are irrevocable and shall be binding upon the
undersigned's heirs, legal representatives, successors and assigns. The
undersigned agrees and consents to the entry of stop transfer instructions with
the Company's transfer agent against the transfer of securities of the Company
held by the undersigned except in compliance with this Agreement.
Very truly yours,
By:
---------------------------
Name:
Title:
Dated: July ___, 1999
35
Exhibit G
PERSONS DELIVERING A LOCK-UP AGREEMENT PURSUANT TO SECTION 6(k)
Xxxxxx X. Xxxxx
Xxxxxx X. Xxxxx
Xxxxxxx X. Xxxxxxxxxx
Xxxxxx Xxxxx
Xxxxxxx X. Xxxxxx
Xxxxxx X. Xxxxxxxxx
Xxxx X. Xxxxxxx
Xxx X. Xxxxx
Xxxxx Xxxx Xxxxxx
Xxxxxx X. Xxxxxxxx
Xxxxx X. Xxxxx
Xxxx X. Xxxxxxx
Xxxxxxx X. Xxxxxxxx
Xxxxxx X. Xxxxxxx, Xx.
Xxxxx X. Xxxxx
X. Xxxxxxxx Xxxxx
Xxxxxxxx X. Xxxxxxx
Xxxxxxx X. Xxxxxxxxx, XX
36
Exhibit H
LOCK-UP AGREEMENT
Bear, Xxxxxxx & Co. Inc.
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
The undersigned is a holder of securities of American Mobile Satellite
Corporation, a Delaware corporation (the "Company"), and wishes to facilitate
the public offering (the "Offering") of the Company's common stock, par value
$.01 per share (the "Common Stock"), pursuant to a Registration Statement on
Form S-3 (File No. 333-81549). The undersigned recognizes that the Offering will
be of benefit to the undersigned.
In consideration of the foregoing and in order to induce you to act as
Underwriter in connection with the Offering, the undersigned hereby agrees, for
the benefit of the Company and the Underwriter, that during the period beginning
from the date hereof and continuing to and including the date 120 days after the
date of the final prospectus relating to the Offering, the undersigned will not,
directly or indirectly, without the prior written consent of Bear, Xxxxxxx & Co.
Inc., offer, sell, contract to sell, swap, make any short sale, pledge,
establish an open "put equivalent position" within the meaning of Rule 16a-1(h)
under the Securities Exchange Act of 1934, as amended (the "Exchange Act"),
grant any option to purchase or otherwise dispose (or publicly announce the
undersigned's intention to do any of the foregoing) of, directly or indirectly,
any shares of Common Stock or other capital stock of the Company, or any
securities convertible into, or exercisable or exchangeable for, any shares of
Common Stock or other capital stock of the Company that the undersigned
currently beneficially owns (within the meaning of Rule 13d-3 under the Exchange
Act), directly or indirectly, or may beneficially own, directly or indirectly,
in the future; provided that the outstanding Registration Statement on Form S-3
shall not be deemed to violate this agreement.
The undersigned confirms that the undersigned understands that the
Underwriter and the Company will rely upon the representations set forth in this
Agreement in proceeding with the Offering. The undersigned further confirms that
the agreements of the undersigned are irrevocable and shall be binding upon the
undersigned's heirs, legal representatives, successors and assigns. The
undersigned agrees and consents to the entry of stop transfer instructions with
the Company's transfer agent against the transfer of securities of the Company
held by the undersigned except in compliance with this Agreement.
Very truly yours,
By:
---------------------------
Name:
Title:
Dated: July ___, 1999
37
Exhibit I
AMERICAN MOBILE CORPORATION
LOCK-UP AGREEMENT
Bear, Xxxxxxx & Co. Inc.
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
The undersigned is a holder of securities of American Mobile Satellite
Corporation, a Delaware corporation (the "Company"), and wishes to facilitate
the public offering (the "Offering") of the Company's common stock, par value
$.01 per share (the "Common Stock"), pursuant to a Registration Statement on
Form S-3 (File No. 333-81549). As a shareholder, the undersigned recognizes that
the Offering will be of benefit to the undersigned and other shareholders of the
Company.
In consideration of the foregoing and in order to induce you to act as
Underwriter in connection with the Offering, the undersigned hereby agrees, for
the benefit of the Company and the Underwriter, that during the period beginning
from the date hereof and continuing to and including the date 120 days after the
date of the final prospectus relating to the Offering, the undersigned will not,
directly or indirectly, without the prior written consent of Bear, Xxxxxxx & Co.
Inc., offer, sell, contract to sell, swap, make any short sale, pledge,
establish an open "put equivalent position" within the meaning of Rule 16a-1(h)
under the Securities Exchange Act of 1934, as amended (the "Exchange Act"),
grant any option to purchase or otherwise dispose (or publicly announce the
undersigned's intention to do any of the foregoing) of, directly or indirectly,
any shares of Common Stock or other capital stock of the Company, or any
securities convertible into, or exercisable or exchangeable for, any shares of
Common Stock or other capital stock of the Company that the undersigned
currently beneficially owns (within the meaning of Rule 13d-3 under the Exchange
Act), directly or indirectly, or may beneficially own, directly or indirectly,
in the future; provided that neither the offer or sale of the Company's common
stock as part of the exercise of the Underwriters' over-allotment option nor the
pendency of the outstanding Registration Statement on Form S-3 (No. 333-71423)
alone shall be deemed to violate this agreement.
The undersigned confirms that the undersigned understands that the
Underwriter and the Company will rely upon the representations set forth in this
Agreement in proceeding with the Offering. The undersigned further confirms that
the agreements of the undersigned are irrevocable and shall be binding upon the
undersigned's heirs, legal representatives, successors and assigns. The
undersigned agrees and consents to the entry of stop transfer instructions with
the Company's transfer agent against the transfer of securities of the Company
held by the undersigned except in compliance with this Agreement.
Very truly yours,
MOTOROLA, INC.
By:
----------------------------------
Name:
Title:
Dated: July ___, 1999
