| Item 1.01 | Entry into a Material Definitive Agreement. |
The information provided in Item 2.01 of this Current Report on Form 8-K is incorporated by reference into this Item 1.01.
| Item 2.01 | Completion of Acquisition or Disposition of Assets. |
Effective June 23, 2010, WorldSpace, Inc. (the “Company”) and certain of its affiliates (together, the “Sellers”) completed the sale of substantially all the assets related to Sellers’ business pursuant to the terms of an asset purchase agreement, dated May 9, 2010, as amended by the amendment dated June 23, 2010 (as so amended, the “Asset Purchase Agreement”) between Yazmi USA LLC (“Yazmi”) and the Sellers. Prior to the sale, the Sellers provided satellite-based radio and data broadcasting services to paying subscribers in ten countries throughout Europe, India, the Middle East and Africa. The Sellers operated two geostationary satellites, AfriStar and AsiaStar, which are currently in orbit over Africa and Asia. Yazmi is a Maryland limited liability co mpany that is owned and controlled by Noah Samara, founder, former chairman, president and CEO of the Company.
After negotiating a sale with numerous interested parties, the Sellers agreed to a sale to Yazmi for a purchase price that consisted of $5,500,000 cash, plus the funding of certain operating expenses. The Sellers retain certain operational and control rights over the assets pending regulatory approvals. In exchange, Yazmi received substantially all of the Sellers’ assets including certain contracts, sales orders, and rights to the Sellers’ owned intellectual property (as defined and described in greater detail in the Asset Purchase Agreement). Yazmi also received rights to certain of the Sellers’ owned equipment (including the AfriStar and AsiaStar satellites), deposits, pre-paid expenses and prepayments relating to the acquired assets, the accounts and notes receivable, books and files, equity interest in acquired subsidiaries, and various other assets (as defined and described in greater detail in the Asset Purchase Agreement). In addition, Yazmi assumed certain liabilities of the Sellers’ business.
As the Sellers had filed for Bankruptcy prior to the sale, the sale required the approval of the U.S. Bankruptcy Court for the District of Delaware (the “Bankruptcy Court”). On June 2, 2010, the Bankruptcy Court approved the sale. Additionally, in conjunction with the sale, a settlement agreement was reached between the Sellers, Yazmi, the Official Committee of Unsecured Creditors, Liberty Satellite Radio, Inc., Liberty Satellite Radio Holdings, LLC and various other parties. The Bankruptcy Court approved the settlement agreement on June 10, 2010.
A copy of the Asset Purchase Agreement is attached as Exhibit 2.1 and Exhibit 2.2 and incorporated herein by reference. The above description of the Asset Purchase Agreement is a summary and is qualified in its entirety by the complete text of the Asset Purchase Agreement.
A copy of our June 24, 2010 press release announcing the closing, subject to continuing some operations under contract with Yazmi for a transition period, of the Asset Purchase Agreement is attached hereto as Exhibit 99.1.
