EXHIBIT 10.43
RESEARCH & DEVELOPMENT, MARKETING AND SERVICE AGREEMENT
THIS RESEARCH & DEVELOPMENT, MARKETING AND SERVICE AGREEMENT (the
"Agreement") is entered into as of 29th day of June, 2000 (the "Effective
Date"), by and between Motient Satellite Ventures LLC, a limited liability
company organized under the laws of the State of Delaware, ("Newco") and Motient
Services Inc. ("Motient Services"), a wholly-owned subsidiary of Motient
Corporation ("Motient Corporation") both of which are corporations incorporated
under the laws of the State of Delaware.
WHEREAS Motient Services owns or otherwise controls the Satellite
Network (as defined below) and related FCC licenses and other resources, which
it uses collectively to provide mobile satellite communications services for its
existing customers; and
WHEREAS Newco wishes to use the Satellite Network to conduct research
and development activities to develop and test new applications and explore new
business opportunities for the Satellite Network; and
WHEREAS, Newco is willing and desirous of purchasing, and Motient
Services wishes to provide, access and use of the Satellite Network (as defined
below) for research, development and testing purposes on the terms and
conditions set forth in this Agreement.
NOW THEREFORE in consideration of the mutual covenants and agreements
set forth below, the Parties hereby agree as follows.
ARTICLE I
DEFINITIONS AND SCHEDULES
1.1 Definitions. In this Agreement, the following words and terms shall have the
respective meanings assigned to them as follows:
"Affiliate" shall mean any entity which, directly or indirectly, controls, is
controlled by, or under common control with, a Party hereto.
"Asset Sale Agreement" means that certain Asset Sale Agreement between Newco and
Motient Services of even date herewith.
"Commercialization Agreement" shall have the meaning assigned to it in Section
2.4.
"Effective Date" is as defined immediately prior to the recitals at the
beginning of this Agreement.
"Emergency Preemption" shall have the meaning assigned to it in Section 3.5.
"Existing Business" shall mean, collectively, the Satellite Network, the FCC
License, and all of the Existing Satellite Service agreements between Motient
Services and any third party.
"Existing Satellite Services" shall mean, collectively, the Satellite
Network-based communications services and applications that are within the scope
of services and applications provided, directly by Motient Services or
indirectly through third party resellers and other intermediaries, to third
parties as of the Effective Date, and any services or applications that are (i)
reasonable extensions of the services and applications offered by Motient
Services as of the Effective Date; and (ii) developed independently by Motient
Services after the Effective Date in the normal course of its business and not
arising out of the R&D Activities.
"FCC" shall mean the Federal Communications Commission.
"FCC License" means the license or licenses issued by the FCC to Motient
Services authorizing use of the Satellite Network to provide Existing Satellite
Services within the Territory.
"Intellectual Property Rights" mean any and all franchise, patents, patent
qualifications, copyrights, know-how, computer software, industrial designs and
drawings and general intangibles of like nature, trade secrets, licenses, and
rights and filings with respect to the foregoing, and all reissues, extensions
and renewals thereof, but excluding trademarks, tradenames, service marks and
service names.
"Investment Agreement" means that certain Investment Agreement among the
Investors, Newco and Motient Corporation dated June 22, 2000.
"Investors" shall have the meaning assigned to it in the Investment Agreement.
"Losses" means all demands, losses, claims, actions or causes of action,
assessments, damages, liabilities, costs and expenses, including, without
limitation, interest, penalties and reasonable attorneys' fees and
disbursements.
"Motient Derivative Works" means any Technology that is developed or created by
or for Newco in connection with the R&D Activities, including without limitation
any Technology developed or created for Newco by Motient Services during the
course of providing the R&D Services for Newco, but which constitutes a
modification or derivative work of any Motient Technology.
"Motient Services" means Motient Services Inc. and its successors and assigns.
"Motient Technology" means any Technology that is developed or created by or for
Motient Services and/or its Affiliates prior to the Effective Date, or after the
Effective Date but independently of the R&D Activities.
"Newco" means Motient Satellite Ventures LLC, and its successors and assigns.
"Newco Takeover" means Newco's acquisition of the Existing Business, as
contemplated by the Asset Sale Agreement.
"Newco Technology" means any Technology other than a Motient Derivative Work
that is developed or created by or for Newco in connection with the R&D
Activities, including without limitation any Technology developed or created for
Newco by Motient Services during the course of providing the R&D Services for
Newco.
"New Satellite Services" shall mean collectively, the Satellite Network-based
communications services (excluding the Existing Satellite Services) and
constituting new applications of the Satellite Network developed by Newco
pursuant to the R&D Activities including without limitation fixed mobile
satellite services, mobile satellite services, and voice, video and data
applications that, in each such case, are different than those offered by
Motient Services as of the Effective Date, excluding, however, any services or
applications that are both (i) reasonable extensions of the services and
applications offered by Motient Services as of the Effective Date; and (ii)
developed independently by Motient Services after the Effective Date in the
normal course of its business and not arising out of the R&D Activities.
"Parent Conversion" means the exchange or conversion of interests in Newco held
by one or more Investors into shares of Motient Corporation's common stock
pursuant to the provisions of the Investment Agreement.
"Party" means Newco or Motient Services.
"Power and Bandwidth Agreement" shall mean any agreement with a term in excess
of one (1) year between Motient Services and a third party that obligates
Motient Services to commit to provide both a specified amount of satellite
transmission power and a specified amount of bandwidth, thereby depleting
available Satellite Network power and bandwidth capacity.
"Proprietary Information" shall have the meaning assigned to it in Section 9.1.
"R&D Activities" shall have the meaning assigned to it in Section 2.1.
"R&D Services" means, collectively, the Services provided by Motient Services to
Newco to support Newco's R&D Activities, as specified in Section 4.1, and in the
R&D Support Plan to be developed pursuant to Section 4.1.
"Satellite Network" shall mean the satellite-based communications network owned,
leased or otherwise controlled by, and operated by, Motient Services, and
consisting of the flight satellite, certain earth stations, gateways and other
ground elements, control systems including telemetry, tracking and control
systems and network operations centers, and the related hardware, software and
networking resources which are used collectively to provide the Satellite
Services. The Satellite Network shall automatically include any additions or
modifications to the Satellite Network made from time to time during the normal
course of Motient Service's business.
"Satellite Services" shall mean collectively the New Satellite Services and the
Existing Satellite Services.
"Service Fee" shall have the meaning assigned to it in Article V.
"Service Payment Date" shall have the meaning assigned to it in Article V.
"Services" includes the R&D Services and the Support Services provided by
Motient Services to Newco pursuant to this Agreement.
"Support Services" shall mean the services provided by Motient Services to
operate and maintain the Satellite Network, and any uplink equipment or other
resources provided by Motient Services to Newco pursuant to this Agreement.
"Technology" means any software components including source code and object code
versions thereof, any documentation, reports, analyses or other printed or
recorded materials, whether in written, electronic or other format, any
hardware, any graphics, audio or video objects, images, photos, artwork,
designs, concepts, inventions, methods, ideas, processes, and any other creative
works of authorship.
"Term" shall have the meaning assigned to it in Section 11.1.
"Territory" is the area within which Motient Services is licensed to use the
Satellite Network to provide Existing Satellite Services, which, as of the
Effective Date includes the United States, Puerto Rico, the U.S. Virgin Islands,
and U.S. coastal waters up to 200 miles on or over ocean areas outside the
territory of any foreign country.
1.2 Schedules. The following Schedules are annexed to this Agreement and are
incorporated into this Agreement by reference and are to be a part of this
Agreement:
Schedule A - Facilities Requirements
Schedule B - Compensation for Services
ARTICLE II
ACCESS RIGHTS AND RESTRICTIONS
2.1 Access and Use Rights.
Motient Services hereby grants to Newco, for the Term of this Agreement, the
non-transferable (except in accordance with Article XIV) right to access and use
the Satellite Network solely for purposes of conducting technical, regulatory
and commercial research and development of New Satellite Services (the "R&D
Activities"). During the Term of this Agreement and subject to the terms set
forth herein, Motient Services agrees that Newco's right to access and use the
Satellite Network for conducting the R&D Activities will be exclusive in the
respect that Motient Services will not provide, or offer to provide, Services
(or services that are substantially similar to the Services) to any third party
for the purpose of assisting such third party in conducting research and
development of New Satellite Services. Motient Services further agrees that,
during the Term of this Agreement, it shall not grant, or offer to grant, the
right to promote, market, commercialize or offer New Satellite Services to any
other party.
2.2 Allocation of Capacity.
Motient Services agrees to provide Newco with up to 1.25 MHz of bandwidth, in
such channel configuration or configurations as the parties shall mutually
agree, to enable Newco to conduct the R&D Activities contemplated by this
Agreement. Unless otherwise agreed by the parties, Motient Services shall
provide a minimum of 6 kHz of bandwidth to Newco. The bandwidth to be provided
by Motient Services shall be in at least one of Motient Services' Continental
United States ("CONUS") satellite beams. Subject to the terms of this Agreement,
Motient Services shall also consider the feasibility of providing bandwidth in
additional (or substitute) CONUS beams. Motient Services shall provide the
foregoing bandwidth to Newco at power levels to be mutually agreed by the
parties, in light of Newco's R&D Activities and subject to the non-interference
provisions and other terms of this Agreement.
Newco agrees to use its commercially reasonable efforts to advise Motient
Services in writing at least sixty (60) days in advance of the beams in which it
may request channels. Newco agrees that Motient Services reserves the right to
plan the use of the satellite capacity by balancing the deployment of channels
and of capacity purchased by Motient Services' other customers. Once a channel
is activated pursuant to the foregoing provisions, it shall remain active until
Newco informs Motient Services that its use of such channel is no longer
required. Motient Services' obligations under this Section 2.2 shall be subject
to the limitations of Section 2.3.
2.3 Excess Capacity.
Newco's right to access and use the Satellite Network shall be subject at all
times to Motient Services' right to use the Satellite Network to provide
Existing Satellite Services. Newco's right of access and use shall be limited to
use of excess Satellite Network capacity not required by Motient Services to
provide the Existing Satellite Services. Newco acknowledges and agrees that the
Satellite Network capacity required to provide the Existing Satellite Services
may increase during the Term of this Agreement, thereby resulting in a decrease
of the excess capacity available to Newco to conduct its R&D Activities. Newco
agrees that Motient Services shall have no liability to Newco as a result of any
such decrease in excess capacity. Motient Services reserves the right, in its
sole discretion, to deal with all matters relating to the Satellite Network,
including without limitation the operation and allocation of satellite capacity
among all of its services and customers, except as otherwise agreed to in
Section 2.1.
During the Term, Motient Services shall provide Newco with reasonable prior
written notice of any new Power and Bandwidth Agreements that Motient Services
proposes to enter into with any third party ("Proposed Contract"). If Newco
reasonably determines that the Proposed Contract materially interferes with
Newco's rights under this Agreement, Newco shall have fifteen (15) days from the
receipt of such notice to notify Motient Services of its objection to the
Proposed Contract. If Newco fails to provide Motient Services with notice of its
objection within said fifteen (15) day period, Newco shall be deemed to have
agreed that Motient Services may enter into the Proposed Contract. In the event
of an objection by Newco as provided above within said fifteen (15) day period,
Motient Services shall not enter into the Proposed Contract.
2.4 Access Restrictions.
Except to the extent provided for in any Commercialization Agreement, Newco may
not use the Satellite Network for any purpose other than conducting the R&D
Activities. Without limiting the preceding sentence, Newco is expressly
prohibited from using the Satellite Network to provide communications services
for use in its ongoing business activities or for the benefit of any third
party. Newco may authorize third parties to access and use the Satellite Network
for purposes of assisting Newco to conduct the permitted R&D Activities, but is
otherwise prohibited from permitting any third party to gain access to or use of
the Satellite Network for any other reason, except as authorized by the
Commercialization Agreement (as defined below). During the Term of this
Agreement, Newco may promote, market, and demonstrate any of the New Satellite
Services to third parties, but may not provide, enter into any agreement to
provide, or otherwise commercialize, the New Satellite Services until Newco and
Motient Services have first entered into a separate network services agreement
authorizing such activities (the "Commercialization Agreement"). Upon request by
Newco, Motient Services and Newco will negotiate in good faith the terms of the
Commercialization Agreement, provided that Motient Services agrees to offer
Newco terms for the Commercialization Agreement that are consistent with those
terms Motient Services offers generally to its other Satellite Service
resellers, and Motient Services further agrees to provide such services at rates
no less favorable than those provided to any of Motient Services' other
similarly situated Satellite Service resellers that have purchased or committed
to purchase a like volume of Satellite Network power and bandwidth capacity from
Motient Services. Newco is prohibited from using the Satellite Network in any
manner that will or is likely to disrupt or interfere with the Satellite Network
or Motient Service's ability to provide the Existing Satellite Services or both.
Newco further agrees to comply with the facilities requirements applicable to
the Satellite Network, as described in Schedule A.
2.5 Continuing Rights of Motient Services.
Motient Services shall retain all rights with respect to the Satellite Network
not expressly granted to Newco under this Agreement, including, without
limitation, the rights: (i) to use the Satellite Network to provide Existing
Satellite Services for itself and for third parties in the normal course of its
business; and (ii) to enter into new agreements for the provision or resale of
Existing Satellite Services to third parties on any basis. Nothing in this
Agreement shall require Motient Services' to violate its obligations as a common
carrier licensed by the FCC with respect to the selling of capacity to third
party resellers.
ARTICLE III
SATELLITE NETWORK SERVICES
3.1 Provision of Satellite Network Facilities.
Motient Services shall operate and maintain the Satellite Network during the
Term of this Agreement to the extent required to provide Existing Satellite
Services. Motient Services shall be responsible to provide, at its expense, all
hardware, software, equipment and other resources necessary to provide, operate
and maintain the Satellite Network to the extent required for Motient Services
to provide the Existing Satellite Services. Motient Services reserves the right
to determine, in its discretion, the particular hardware, software, equipment or
other resources to be used to provide, operate and maintain the Satellite
Network, the location of any facilities, operations centers, and other resources
used in connection with the Satellite Network, the personnel to be used to
provide Support Services, and any third party vendors, service providers, or
other suppliers used to source any of the foregoing items.
3.2 Provision of R&D Equipment and Resources.
Newco shall be responsible to provide, operate and maintain at its expense, any
hardware, software, equipment and other resources additional to that to be
provided by Motient Services pursuant to Section 3.1, as and to the extent
required for Newco to conduct its R&D Activities and to develop and test any New
Satellite Services. Motient Services shall have the right to review and approve
in advance any such additional hardware, software, equipment or other resources
proposed by Newco to be integrated with, or otherwise used in connection with,
the Satellite Network to ensure that it will not unduly interfere with the
Satellite Network and/or the provision of Existing Satellite Services, such
approval not to be unreasonably withheld.
3.3 Provision of Uplink Equipment.
Motient Services shall, at its expense, make available to Newco reasonable
access to Motient Services' existing ground-based uplink equipment required to
access and use the Satellite Network, consistent with that used by, or provided
to, power and bandwidth users of the Existing Satellite Services. Motient
Services shall designate a facility for use by Newco to conduct the R&D
Activities. Motient Services will use commercially reasonable efforts to support
and maintain such uplink equipment consistent with Section 3.4 below. Newco
shall, at its expense, be responsible to provide, operate and maintain any
additional uplink equipment required by Newco to conduct the R&D Activities.
3.4 Maintenance of Satellite Network.
Motient Services shall use commercially reasonable efforts to maintain the
Satellite Network and any uplink equipment provided by Motient Services in good
working condition. Motient Services shall provide Newco with a telephone number
to be used to obtain support for the Satellite Network and to report problems
and defects in the Satellite Network or uplink equipment provided by Motient
Services. Motient Services will use commercially reasonable efforts to correct
problems and defects in the Satellite Network or such uplink equipment reported
by Newco within a reasonable time. Motient Services reserves the right to
interrupt Newco's access and use of the Satellite Network in order for Motient
Services to perform scheduled maintenance of the Satellite Network. Motient
Services shall provide Newco with reasonable advance written notice of any such
scheduled maintenance.
3.5 Emergency Preemption or Suspension of Service.
Newco's use of the Satellite Network may be preempted, interrupted or suspended
due to conditions or reasons beyond Motient Services' reasonable control
("Emergency Preemption"), including but not limited to: (i) maintenance
requirements or emergency conditions experienced by Motient Services; (ii) the
protection of Motient Services' personnel, facilities or services; or (iii) the
provision of priority and preemptive access to Motient Services' satellite as
required by the U.S. Coast Guard, the Federal Aviation Administration or other
governmental agency to provide responsive emergency support during any natural
or man-made disasters.
3.6 Notice to Newco of Suspension or Emergency Preemption of Service.
In the event of any Emergency Preemption, Motient Services shall notify Newco as
soon as practicable and shall use commercially reasonable efforts to make the
Satellite Network available to Newco to conduct R&D Activities as quickly as
practicable.
ARTICLE IV
R&D SUPPORT SERVICES
4.1 R&D Support Plan.
Motient Services agrees to provide Newco with the system interfacing and
engineering support necessary for Newco to interface with the Satellite Network
as required for Newco to perform its R&D Activities under this Agreement,
subject to the terms and conditions of this Agreement. Within a reasonable time
after the Effective Date, Motient Services and Newco shall develop and mutually
agree upon the details of an R&D support services plan (the "R&D Support Plan"),
identifying the consulting, engineering, technical and other personnel and other
resources to be provided by Motient Services in support of Newco's R&D
Activities, as well as identifying any third party consultants, engineers and/or
other third party resources that Newco will engage to assist it in its R&D
Activities. Motient Services will provide Newco with additional support for
Newco's R&D Activities as and when requested by Newco, to the extent Motient
Services has the personnel required to provide such support, and, except as
provided in Schedule B, such support shall be provided without additional charge
to Newco. The parties agree that any third party consultants or service
providers engaged by Newco to assist Newco in R&D Activities shall execute an
appropriate non-disclosure or confidentiality agreement to preserve the
confidentiality of Newco's R&D Activities. The R&D Support Plan shall specify in
detail the quantity and type of personnel resources and other resources to be
provided by Motient Services in order for Newco to conduct its R&D Activities,
and the schedule specifying when such resources will be required. Motient
Services shall make the resources specified in the R&D Support Plan available to
Newco in accordance with such schedule. The R&D Support Plan shall be updated
periodically during the Term of this Agreement, as reasonably required to
support Newco's R&D Activities. Newco shall have complete discretion to
determine the scope and level of R&D Activities in which it may choose to
engage, to the extent not inconsistent with this Agreement.
4.2 Testing Process.
Motient Services agrees to make reasonable configuration changes to the
Satellite Network as required to support Newco's R&D Activities in accordance
with the following process, provided such changes are conducted in a manner that
will not adversely affect the Existing Satellite Services. Prior to undertaking
any R&D Activities that will require any such configuration change, or that will
or may adversely affect the Satellite Network and/or Motient Service's ability
to provide Existing Satellite Services, Newco shall provide Motient Services
with a test plan set forth in writing which describes the requested
configuration change, the testing to be undertaken, the proposed schedule for
such testing, the risks to the Satellite Network and/or the Existing Satellite
Services imposed by such testing, the steps to be taken to eliminate or mitigate
the risks, and any other pertinent information regarding the proposed R&D
Activities (each a "Test Plan"). Motient Services will have a reasonable
opportunity to review the Test Plan prior to commencement of testing. Motient
Services may require changes in the Test Plan before approving the Test Plan, if
Motient Services reasonably believes that such changes are required to minimize
risk to the Satellite Network and/or its ability to provide Existing Satellite
Services. Notwithstanding the foregoing, Motient Services reserves the right to
disapprove any proposed Test Plan and to prohibit any proposed testing in the
event Motient Services reasonably believes that such testing poses a material
risk to the Satellite Network, and/or its ability to provide Existing Satellite
Services.
4.3 Project Management.
Each Party shall appoint a project manager ("Project Manager") who shall be
responsible to oversee such Party's activities and responsibilities under this
Agreement and to communicate with the Project Manager of the other Party to
coordinate their respective activities hereunder, and to resolve issues and
disputes that arise during the Term of this Agreement. Each Party may change its
Project Manager upon prior written notice to the other Party.
4.4 Dispute Resolution.
The parties shall attempt to resolve any disputes arising out of or relating to
this Agreement by negotiations between the party's respective Project Managers.
In the event that the Project Managers are unable to resolve any such dispute
within a reasonable time, such dispute shall be escalated in turn to
successively higher level managers of each party who will attempt to resolve the
dispute through negotiation. If, despite such attempts, such dispute remains
unresolved after a period of sixty (60) days from the date first raised by
either Project Manager, then such dispute shall be submitted to final and
binding arbitration before JAMS/ENDISPUTE ("JAMS"), or its successor, pursuant
to the United States Arbitration Act, 9 U.S.C. Sec. 1 et seq. Either party may
commence the arbitration process called for in this agreement by filing a
written demand for arbitration with JAMS, with a copy to the other party. The
arbitration will be conducted in accordance with the provisions of JAMS
Streamlined Arbitration Rules and Procedures in effect at the time of filing of
the demand for arbitration. Any such arbitration shall take place at a mutually
agreed location within the Washington, D.C. metropolitan area. The parties will
cooperate with JAMS and with one another in selecting an arbitrator from JAMS
panel of neutrals, and in scheduling the arbitration proceedings. The parties
covenant that they shall participate in the arbitration in good faith, and that
they shall share equally in its costs. The provisions of this Section 4.4 may be
enforced by any Court of competent jurisdiction. The costs of any such
arbitration shall be shared equally by the parties; provided that each party
shall bear the costs of preparing and presenting its own case. The arbitrators
shall have no power to award any punitive damages. The arbitrator's award shall
be final and binding, and may be enforced in any court of competent
jurisdiction. The results of any such arbitration shall be deemed to be
Proprietary Information under this Agreement.
ARTICLE V
PAYMENT
On or before July 14, 2000, Newco shall pay to Motient Services a one-time
service fee in the amount of Twenty Million Dollars ($20,000,000) (the "Service
Fee") (the date upon which such payment is made shall be the "Service Payment
Date"). Such payment shall be made by wire transfer of immediately available
funds to an account designated in writing by Motient Services. Motient Services
shall have no obligation to provide any Satellite Services or any other
Services, or to otherwise fulfill any of its obligations under this Agreement
prior to the Service Payment Date. The Service Fee represents full payment in
advance for all support and other services to be provided by Motient Services to
Newco pursuant to this Agreement, except for those services requiring additional
payment, as specified in Schedule B. Motient Services shall be responsible to
pay any sales and use taxes or similar such taxes levied or imposed upon the
Services provided by Motient Services to Newco pursuant to this Agreement.
ARTICLE VI
REGULATORY COMPLIANCE
6.1 Responsibilities of Motient Services.
In performing the Services and fulfilling its other obligations under this
Agreement, Motient Services shall comply with all applicable laws, regulations,
rules, ordinances and other legal and administrative obligations applicable
thereto, including without limitation the terms of any applicable FCC License.
Motient Services shall be responsible to secure and maintain in effect, at its
expense, and shall use all commercially reasonable efforts to secure and
maintain all licenses, permits, rights-of-way, approvals, and any other
arrangements necessary for providing, operating and maintaining the Satellite
Network and for providing Existing Satellite Services, including without
limitation all required FCC or other governmental licenses, permits or
approvals.
6.2 Responsibilities of Newco.
In conducting the R&D Activities and fulfilling its other obligations under this
Agreement, Newco shall comply with all applicable laws, regulations, rules,
ordinances and other legal and administrative obligations applicable thereto,
including without limitation the terms of any applicable FCC License. Newco
shall be responsible to secure and maintain in effect, at its expense, all
licenses, permits, rights-of-way, approvals, and any other arrangements
necessary for carrying out the R&D Activities and for using the Satellite
Network to research, develop and test New Satellite Services, including without
limitation all required FCC or other governmental licenses, permits or
approvals, but excluding those items which Motient Services is responsible to
obtain as specified in Section 6.1. Newco shall confer with Motient Services
prior to obtaining any additional licenses, permits, rights-of-way, approvals or
other arrangements for which it is responsible, to allow Motient Services to
coordinate such activities with its own regulatory compliance program. Upon
request by Newco, Motient Services shall provide Newco with reasonable
cooperation and support to assist Newco in obtaining any such licenses, permits,
rights-of-way, approvals or other arrangements, and, if requested by Newco,
Motient Services shall obtain any such license, permit, right-of-way, approval
or other arrangement in its own name; provided that Newco shall be responsible
to reimburse Motient Services for any costs incurred by it to obtain and/or
maintain any FCC licenses, permits, and approvals that would otherwise be the
responsibility of Newco under this Section 6.2. Newco shall use the Satellite
Network only for lawful purposes and in compliance with all applicable rules,
policies and regulations of Motient Services, the FCC and those of any other
federal, state, or local governmental agencies.
6.3 Relationship to FCC.
The Satellite Network and any Services provided by Motient Services under this
Agreement, are subject to the continuing approval of the FCC. Newco hereby
consents to the filing of this Agreement with the FCC if required by applicable
law and regulation. Motient Services shall advise Newco in advance of such a
filing. The Parties will cooperate to seek such approvals and coordination,
provided that Motient Services will be solely responsible for all FCC matters
relating to the Satellite Network and the Existing Satellite Services, including
but not limited to frequency coordination.
6.4 Notification Regarding FCC Actions.
Each party shall use commercially reasonable efforts to keep the other party
apprised of its licensing and regulatory activities with respect to the FCC, the
status of any filings made by such party with the FCC, and of any actions or
rulings of the FCC of which such party is aware, to the extent such party
reasonably determines that any of the foregoing materially affects the
activities of the other party with respect to this Agreement, the Satellite
Network, or the R&D Activities and other activities contemplated by this
Agreement.
ARTICLE VII
ADDITIONAL OBLIGATIONS OF THE PARTIES
7.1 Ethical Responsibilities of the Parties.
Motient Services and Newco shall each refrain from doing anything that would
tend to reflect adversely upon, or in any manner injure the reputation of the
other (or their respective parent entities and affiliates) or adversely affect
the other, or, in the case of Motient Services, adversely affect Motient
Services' status as a licensed common carrier, except that a Party's enforcement
of its rights and performance of its duties and obligations contained herein
shall not be deemed a violation of this Section 7.1.
7.2 Insurance.
Until the Newco Takeover occurs, Motient Services is responsible to ensure that
it is covered at all times by insurance consistent with levels of coverage in
effect as of the Effective Date.
ARTICLE VIII
INTELLECTUAL PROPERTY
8.1 Newco Technology.
Newco shall retain all right, title and interest in and to any of the Newco
Technology developed or created during the course of this Agreement by or for
Newco, including all Intellectual Property Rights therein. To the extent Motient
Services acquires any interest in the Newco Technology, Motient Services hereby
assigns, transfers and conveys to Newco all of its right, title and interest in
and to the Newco Technology, including all Intellectual Property Rights therein.
8.2 Motient Technology.
Motient Services shall retain all right, title and interest in and to any
Motient Technology used by or licensed to Newco during the course of this
Agreement, including all Intellectual Property Rights therein. To the extent
Newco acquires any interest in the Motient Technology, Newco hereby assigns,
transfers and conveys to Motient Services all of its right, title and interest
in and to the Motient Technology, including all Intellectual Property Rights
therein.
8.3 Motient Derivative Works.
Newco shall retain all right, title and interest in and to any Motient
Derivative Works developed or created during the course of this Agreement by or
for Newco, including all Intellectual Property Rights therein, subject to
Motient Service's continued ownership of any Motient Technology contained in any
such Motient Derivative Work. To the extent Motient Services acquires any
interest in any Motient Derivative Works, Motient Services hereby assigns,
transfers and conveys to Newco all of its right, title and interest in and to
the Motient Derivative Works, including all Intellectual Property Rights
therein, but excluding any underlying Motient Technology contained in any such
Motient Derivative Works.
8.4 License to Newco.
Motient Services hereby grants to Newco a non-exclusive, non-transferable
(except in the event of an assignment of this Agreement in whole by Newco as
authorized in Article XIV), royalty-free license to use, reproduce, modify, and
to distribute internally, but not to sublicense to third parties, any Motient
Technology that is needed for Newco to perform the R&D Activities. Newco's
licensed rights to the Motient Technology are restricted solely for the purpose
of conducting the R&D Activities, and for system development, deployment and
operations activities in the conduct of its own business and customer service
pursuant to any Commercialization Agreement. Notwithstanding the foregoing, to
the extent provided in any Commercialization Agreement, Newco may sublicense
rights to use such Motient Technology to third parties to the extent required by
them to use any New Satellite Services that may be provided by Newco. In
addition, in the event that the Asset Sale Agreement is terminated due to an
event arising under Section 8.8, 8.9 or 8.10 of the Asset Sale Agreement, the
license granted above in this Section 8.4 shall be modified as follows: (i)
Newco's licensed rights shall be limited to that portion of the Motient
Technology that is actually contained in a Motient Derivative Work
("Incorporated Motient Technology); (ii) Newco may thereafter use, reproduce,
and modify such Incorporated Motient Technology, and may distribute and
sublicense such Incorporated Motient Technology for any lawful purpose, so long
as such Incorporated Motient Technology at all times remains a part of a Motient
Derivative Work; (iii) Newco may exercise such licensed rights as modified
without the need to enter into any Commercialization Agreement; (iv) as
modified, such licensed rights shall be perpetual, notwithstanding any
termination of this Agreement; and (v) as modified, such license shall remain
transferable in connection with an assignment of this Agreement as specified in
the first sentence of this Section 8.4.
8.5 Further Assurances.
Each Party will upon request of the other Party, and at the other Party's
expense, assist the other Party as reasonably necessary with applications for
trademarks, patents, copyrights or other forms of intellectual property
protection with respect to the Technology owned by or licensed to such other
Party pursuant to this Agreement. Each Party will execute any documents
reasonably requested by the other Party for the purpose of establishing its
right of ownership to such Technology without the need for any additional
compensation.
ARTICLE IX
CONFIDENTIALITY
9.1 General.
Each Party acknowledges that during the course of this Agreement it may gain
access to confidential information belonging to or relating to the other Party,
including but not limited to any business, financial and technological
information (collectively, "Proprietary Information") which Proprietary
Information constitutes valuable assets and trade secrets of the other Party.
"Proprietary Information" of Newco shall include information regarding the R&D
Activities to be conducted by Newco under this Agreement, and the results
thereof. Accordingly, when a Party (the "Receiving Party") receives Proprietary
Information from the other Party (the "Disclosing Party") the Receiving Party
shall, both during the Term of this Agreement and for a period of three (3)
years following expiration or termination thereof:
(a) keep secret and retain in strict confidence any Proprietary Information
received from the Disclosing Party;
(b) not disclose to any third party any Proprietary Information
received/from the Disclosing Party for any reason whatsoever except as
authorized under this Agreement;
(c) not disclose any Proprietary Information received from the Disclosing
Party to the Receiving Party's and its Affiliates' employees, except on a
need-to-know basis; and
(d) not make use of any Proprietary Information received from the
Disclosing Party for its own purposes or for the benefit of any third party
except as authorized by this Agreement.
9.2 Requested or Required Disclosure.
Notwithstanding Section 9.1, if the Receiving Party is requested or required to
disclose Proprietary Information of the Disclosing Party pursuant to: (i) any
federal or state law or regulation; or (ii) the order or request of any federal
or state court, or regulatory entity or agency, the Receiving Party shall: (A)
in the event of a request for such Proprietary Information by a court,
regulatory entity or agency, use commercially reasonable efforts to obtain the
written consent of the court or agency to maintain the confidentiality of such
Proprietary Information; (B) provide written notice to the Disclosing Party; and
(C) furnish only such portion of the Proprietary Information as the Receiving
Party is legally required to disclose.
9.3 Disclosure to Third Parties.
Each party covenants not to divulge Proprietary Information to any third
parties, except as set forth in Section 9.2, without obtaining a nondisclosure
agreement from such party, wherein such third party undertakes to handle
Proprietary Information under confidentiality terms and conditions no less
restrictive than those set forth in this Agreement.
9.4 Exceptions.
The obligations of this Article IX shall not extend to any information which:
(a) is in the public domain; (b) comes into the public domain through no fault
of the parties or their employees; (c) is already lawfully known, free of
restrictions, to the Receiving Party at the time of its receipt; (d) is received
by the Receiving Party from a third party who is not under an obligation of
confidence with respect to such information; (e) is known or developed
independently of the disclosure by the Disclosing Party as can be proved by the
Receiving Party's contemporaneous business records; or (f) is required to be
disclosed by a government or regulatory agency, by court order or by law.
9.5 Events upon Termination.
Upon any expiration or termination of this Agreement, or upon demand by
Disclosing Party, Receiving Party shall promptly return any documents or other
materials containing Proprietary Information of Disclosing Party in its
possession, or shall certify to Disclosing Party that such documents or other
materials containing Proprietary Information have been destroyed, except that
the Receiving Party need not return or destroy any documents or other materials
containing Proprietary Information consisting of Technology that is licensed to
the Receiving Party under a license which survives expiration or termination.
9.6 Injunction.
Both parties acknowledge that remedies at law for breach of either party's
obligations under this Article IX may be inadequate, that the non-breaching
party may be irreparably harmed by any such breach, and that in the event of any
such breach, the non-breaching party shall be entitled to obtain specific
performance or injunctive relief without a requirement to post bond.
ARTICLE X
REPRESENTATIONS AND WARRANTIES
10.1 Representations and Warranties.
(a) Motient Services represents and warrants to Newco as follows:
(i) it has the authority to enter into and perform this Agreement;
this Agreement when executed, will be legal, valid and binding upon it, and
will be enforceable in accordance with its terms; and it has made no
misrepresentations to the other party in connection with the negotiation,
execution, or performance of this Agreement; and
(ii) the execution and performance of this Agreement does not and will
not violate (x) the Series A and Series B 12 1/4% Senior Notes due 2008
Indenture, dated March 31, 1998, of Motient Holdings Inc. ("Holdings") or
(y) any other contract, obligation, or instrument held by it or to which it
is a party, or which is binding upon it, including terms relating to
covenants not to compete and confidentiality obligations; and
(iii) provided that Newco complies with its obligations under Section
6.2, the execution and performance of this Agreement by Motient Services
does not and will not violate any applicable laws, regulations, rules,
ordinances and other legal and administrative obligations applicable
hereto; and
(iv) it possesses all licenses issued by the FCC, and all other
licenses, permits, franchisers and similar authorizations, that are
required for the operation of the Satellite Network and for provision of
Existing Satellite Services as presently conducted on the Effective Date,
and the ownership, operation, lease and holding by it of the Satellite
Network resources (the "Company Permits"). Motient Services is in
compliance with the terms of the Company Permits.
(b) Newco represents and warrants to Motient Services as follows:
(i) it has the authority to enter into and perform this Agreement;
this Agreement when executed, will be legal, valid and binding upon it, and
will be enforceable in accordance with its terms; and it has made no
misrepresentations to the other party in connection with the negotiation,
execution, or performance of this Agreement; and
(ii) the execution and performance of this Agreement does not and will
not violate any other contract, obligation, or instrument held by it or to
which it is a party, or which is binding upon it, including terms relating
to covenants not to compete and confidentiality obligations.
10.2 Disclaimer of Warranty.
EXCEPT AS OTHERWISE PROVIDED IN THIS AGREEMENT, MOTIENT SERVICES MAKES NO
WARRANTY OR CONDITION, EXPRESS OR IMPLIED, REGARDING THE SATELLITE NETWORK OR
ANY OTHER ITEM OF EQUIPMENT, HARDWARE, SOFTWARE OR ANY OTHER RESOURCE PROVIDED
BY MOTIENT SERVICES PURSUANT TO THIS AGREEMENT, OR THE PROVISION OF ANY SERVICE
PROVIDED BY MOTIENT SERVICES PURSUANT TO THIS AGREEMENT, INCLUDING BUT NOT
LIMITED TO THE IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A
PARTICULAR PURPOSE.
ARTICLE xi
TERM AND TERMINATION
11.1 Term.
This Agreement shall commence on the Effective Date and shall remain in effect
for a period of three (3) years after the Effective Date (the "Term"), unless
sooner terminated in accordance with Sections 11.3, or 11.4 hereof, whichever
occurs first.
11.2 Suspension by Motient Services.
Motient Services may immediately suspend Newco's access to the Satellite Network
and the provision of any Service to Newco without any liability of Motient
Services to Newco or to any third party upon the occurrence of any of the
following:
(i) Newco's use of the Satellite Network or performance of the R&D
Activities is in violation of any statute or law or of any order, rule or
regulation of any court, agency or government authority; or
(ii) Newco's use of the Satellite Network or performance of the R&D
Activities is conducted in a manner that materially interferes with the
Satellite Network and/or Motient Services' ability to provide the Existing
Satellite Services.
Upon the occurrence of any such event, Motient Services shall use commercially
reasonable efforts to provide prior written notice to Newco and a reasonable
opportunity to cure prior to imposing any such suspension, but Motient Services
reserves the right to suspend access to the Satellite Network and provision of
Services to Newco immediately without prior notice if Motient Services
reasonably believes that it must act immediately to protect the Satellite
Network and its ability to provide Existing Satellite Services and/or to avoid
violations of law. In either event, access to the Satellite Network and
provision of Service shall be restored upon cure by Newco of the event giving
rise to the suspension.
11.3 Termination upon Exercise of Newco Takeover.
This Agreement shall automatically terminate on the date of closing of the
transactions associated with the Newco Takeover.
11.4 Termination Option upon Sale of Existing Business to a Third Party.
If Motient Corporation receives an Offer (as defined in the Asset Sale
Agreement), and if Newco shall not have delivered a Notice to acquire the
Satellite Communications Business (as defined in the Asset Sale Agreement)
within sixty (60) days after the Offer Notice Date (as defined in the Asset Sale
Agreement), and if Motient Corporation or Motient Services elects to pursue the
Offer, Motient Services shall so notify Newco in writing. If, after electing to
pursue the Offer, the transactions contemplated by the Offer fail to be
consummated, Motient Services shall notify Newco in writing of such event, as
well. During the period commencing on the date of Newco's receipt of Motient
Services' notice of the election to pursue the Offer and ending on either (i)
the date of consummation of the transactions contemplated by the Offer, or (ii)
the date of Newco's receipt of written notice that such transactions will not be
consummated (whichever applies), Newco shall refrain from entering enter into
any new Satellite Service agreements with any third party as permitted under the
Commercialization Agreement, and from taking any action that would further
deplete the available Satellite Network capacity or otherwise materially
interfere with the transactions contemplated by the Offer. In the event such
transactions are consummated, Motient Services shall have the right, in its sole
discretion, and without consent of Newco, to terminate this Agreement upon
written notice to Newco and upon compliance with the requirements of Section 8.9
of the Asset Sale Agreement.
11.5 Events upon Termination.
Upon termination of this Agreement pursuant to Section 11.3 or 11.4, Newco shall
immediately cease all access and use of the Satellite Network, and shall
promptly, but in no event less than thirty (30) days after termination, return
to Motient Services any and all resources provided to Newco by Motient Services,
and remove all Newco Technology from Motient Services' premises and equipment.
ARTICLE xiI
LIMITATION OF LIABILITY
12.1 Survival of Representations.
Notwithstanding anything to the contrary set forth in Section 15.9, all
representations and warranties in or pursuant to this Agreement shall survive
until two (2) years after the date of expiration or termination of this
Agreement.
12.2 Limitation of Liability.
Motient Services shall in no event be liable for:
(i) Any Satellite Network service outage or failure; or
(ii) Any decrease in the excess capacity of the Satellite Network or
of the time periods in which the Satellite Network is made available to
Newco to conduct the R&D Activities as a result of expansion of the
Existing Satellite Services in the normal course of business and consistent
with this Agreement; or
(iii) The unauthorized access to, or alteration, theft, or destruction
of data and/or information of Newco by any person other than a
subcontractor or agent of Motient Services, whether through accident or
fraudulent means or devices, whether caused by interruption, errors,
defects, delays in operation or failure of the Service; or
(iv) Any claim arising out of a breach in the privacy or security of
communications transmitted over Motient Services' facilities, unless such
breach is caused by Motient Services' willful misconduct; or
(v) Any change required by any governmental authority to the Satellite
Network or Motient Services' facilities, operations or procedures used in
connection with the Satellite Network that renders the Satellite Network or
any such facilities provided by Motient Services or Newco obsolete, or that
requires Newco to make a material modification or alteration of the Newco
Technology to remain compatible with the Satellite Network or such
facilities, or that otherwise adversely affect the use or performance of
the Newco Technology; or
(vi) Any Loss incurred by reason of or incidental to any delay or
interruption of the Service, other than a delay or interruption due to
Motient Services' willful misconduct; or
(vii) Any failure by Motient Services, after exercise of all
commercially reasonable efforts, to obtain and/or maintain any required and
material FCC or other government approvals for the provision of the Service
in the Territory; or the issuance of an effective final order by the FCC,
or other government agency having jurisdiction, revoking or denying renewal
of the mobile satellite services authorization granted to Motient Services.
12.3 Aggregate Damages.
The Indemnifying Party shall not be obligated to pay any amounts for
indemnification under Article 13 hereof until the aggregate indemnification
obligation of such Indemnifying Party hereunder (and under the Asset Sale
Agreement) exceeds Five-Hundred Thousand Dollars ($500,000) (the "Basket"),
whereupon the Indemnifying Party shall be liable for all amounts for which
indemnification may be sought which exceed $500,000. Notwithstanding the
foregoing, in no event shall the aggregate liability of Motient Services to
Newco exceed the sum of (i) the aggregate fees (including the Service Fee) paid
by Newco to Motient Services pursuant to this Agreement, (ii) the Purchase Price
(to the extent actually paid) as defined in the Asset Sale Agreement; and (iii)
other amounts paid as consideration under any agreements delivered pursuant
thereto (collectively, the sum of (i), (ii) and (iii) constitute the "Liability
Cap"). The Liability Cap will not apply to any claims made with respect to any
Loss arising as a result of a breach of this Agreement due to Motient Services'
bad faith or willful misconduct, or to any Losses arising out of a breach of the
representation and warranty set forth in Section 10.1(a)(ii)(x). For purposes of
determining whether the aggregate indemnification obligation of an Indemnifying
Party exceeds the Basket, the sum of all amounts previously indemnified by such
Indemnifying Party for Losses arising under both this Agreement and under the
Asset Sale Agreement, and any agreements delivered pursuant thereto shall be
used to make such determination.
12.4 Exclusive Remedy.
Indemnification pursuant to Article 13 in accordance with this Article 12 shall
be the sole and exclusive remedy for any breach of the representations,
warranties and covenants contained in this Agreement by either party, other than
claims relating to fraud or violations of securities laws; provided that,
nothing in this Section 12.4 shall prevent any party from obtaining equitable
relief in order to require the other party to perform its obligations hereunder.
12.5 Limitation of Liability for Motient Services' Suppliers.
To the extent that any portion of the Services or any facilities used in
connection with the Satellite Network are provided by any third party pursuant
to a separate agreement arrangement between Motient Services and such third
party, the limitation of liability set forth in this Article 12 shall extend
fully to such third party.
ARTICLE xiii
INDEMNITY
13.1 Indemnification by Newco.
Newco shall indemnify and hold Motient Services harmless from and against any
and all Losses arising out of any claim made by a third party based upon any of
the following:
(i) The content or addressing of any message transmitted by Newco or
any third party claim of libel, slander, or infringement of copyright
against Motient Services arising from or in connection with the
transmission of messages via the Satellite Network by Newco or third
parties accessing the Satellite Network through Newco;
(ii) Any negligent act or omission of Newco, or its officers,
directors, employees or agents resulting in personal injury or damage to
tangible or real property; or
(iii) Any breach by Newco of the applicable representations,
warranties and covenants set forth in this Agreement; or
(iv) Any portion of the Newco Technology or any portion of the Motient
Derivative Works (other than the underlying Motient Technology) infringes
the Intellectual Property Rights of a third party; provided that Newco
shall have no obligation to indemnify Motient Services under this
subsection (iv) to the extent such an infringement claim results solely
from modification of the Newco Technology or the Motient Derivative Works
by Motient Services or any person or entity obtaining access to such Newco
Technology or Motient Derivative Works through Motient Services.
13.2 Indemnification by Motient Services.
Motient Services shall indemnify and hold Newco harmless from and against any
and all Losses arising out of any claim made by a third party based upon any of
the following:
(i) Any negligent act or omission of Motient Services, or its
officers, directors, employees or agents resulting in personal injury or
damage to tangible or real property; or
(ii) Any breach by Motient Services of the applicable representations,
warranties and covenants set forth in this Agreement; or
(iii) Any portion of the Motient Technology infringes the Intellectual
Property Rights of a third party; provided that Motient Services shall have
no obligation to indemnify Newco under this subsection (iii) to the extent
such an infringement claim results solely from (a) the addition and/or
combination by Newco of products not provided by Motient Services with the
Motient Technology; or (b) modification of the Motient Technology by Newco
or any person or entity obtaining access to such Motient Technology through
Newco.
13.3 Notification for Indemnification.
All claims for indemnification hereunder shall be resolved in accordance with
the following procedures:
(i) If the party seeking indemnification (the "Indemnified Party") has
incurred or reasonably believes that it may incur any Losses, it shall
deliver promptly written notice to the indemnifying party (the
"Indemnifying Party"), setting forth the nature and amount of the Losses or
potential Losses, if possible, and further referencing the sections of this
Agreement or in any other document delivered pursuant hereto upon which the
claim for indemnification for such Losses is based (a "Claim Notice"). If
an Indemnified Party receives notice of a third-party claim for which it
intends to seek indemnification hereunder, it shall give the Indemnifying
Party written notice of such claim, so that the Indemnifying Party's
defense of such claim under this Agreement may be timely instituted. The
failure by an Indemnified Party to provide such written notice shall not
constitute a waiver of the Indemnified Party's right to indemnity unless
such failure has prejudiced the Indemnifying Party's ability to defend such
claim, and then only to the extent of such prejudice.
(ii) If, after receiving a Claim Notice, the Indemnifying Party
desires to dispute such claim or the amount claimed in the Claim Notice, it
shall deliver to the Indemnified Party a written objection to such claim or
payment setting forth the basis for disputing such claim or payment. Such
notice shall be delivered within thirty (30) days after the date the Claim
Notice to which it relates is received by the Indemnifying Party. If no
such notice is received within the aforementioned 30-day period, the
Indemnified Party shall be entitled to payment for such Losses from the
Indemnifying Party within ten (10) days of the end of such 30-day objection
period.
(iii) If the Indemnifying Party shall agree that it is responsible for
all amounts that may be recovered in connection with a third-party claim,
action or suit (including waiving any deductible or limit that might
otherwise apply under this Article 13 or Section 12.3 hereof) and is
financially capable of satisfying its indemnification obligations, the
Indemnifying Party shall have the right to conduct and control through
counsel of its own choosing, which counsel shall be reasonably acceptable
to the Indemnified Party, any third-party claim, action or suit; provided,
that the Indemnifying Party diligently contests and defends such claim. The
Indemnified Party shall be entitled at any time, at its own cost and
expense (except that such cost and expense shall be paid by the
Indemnifying Party if the Indemnified Party reasonably determines that the
Indemnifying Party is not adequately representing or, because of a conflict
of interest, may not adequately represent the interests of the Indemnified
Party) to participate in such defense and to be represented by attorneys of
its choosing. Except with the prior written consent of the Indemnified
Party no Indemnifying Party, in the defense of such claim or litigation,
shall consent to entry of any judgment or order, interim or otherwise, or
enter into any settlement that provides for injunctive or other nonmonetary
relief affecting the Indemnified Party or that does not include as an
unconditional term thereof the giving by each claimant or plaintiff to such
Indemnified Party of a release from all liability with respect to such
claim or litigation.
(iv) In the event that the Indemnifying Party does not elect to defend
against any third-party claim, the Indemnified Party may defend against
such claim in such manner as it may deem appropriate and the Indemnifying
Party shall be liable for any legal expenses reasonably incurred in
connection with such defense; provided that, the Indemnified Party shall
not, without the consent of the Indemnifying Party, which consent shall not
be unreasonably withheld, settle or consent to the entry of judgment with
respect to such third-party claim.
(v) In the event of any claim by a third party, the parties hereto
agree that they will cooperate fully with each other in connection with the
defense or settlement of such matter.
13.4 No Duplication of Remedies.
To the extent any party may have more than one remedy for any Losses incurred by
it, it may pursue all available remedies but in no event shall be entitled to
collect and retain any amount hereunder in excess of its Losses.
13.5 Subrogation.
If any Indemnified Party receives any payment or other indemnification pursuant
to this Agreement from an Indemnifying Party with respect to any claim or demand
by any third party against the Indemnified Party, the Indemnifying Party shall
be subrogated to the extent of such payment or indemnification to all rights in
respect of the subject matter of such claim or demand to which the Indemnified
Party may be entitled, to institute appropriate action for the recovery thereof,
and the Indemnified Party agrees to provide reasonable levels of assistance and
cooperation to such subrogated party, in enforcing such rights.
ARTICLE xiV
ASSIGNMENT
Motient Services shall not assign its rights and obligations under this
Agreement, in whole or in part, whether by operation of law or otherwise,
without the prior written consent of Newco. Newco shall not assign its rights
and obligations under this Agreement, in whole or in part, whether by operation
of law or otherwise, unless the assignee agrees to be bound by all of the terms
and conditions hereof applicable to Newco hereunder, and provided that any such
assignment shall be subject to any prior approval required by the FCC, and
compliance with any conditions and restrictions imposed by the FCC with respect
to such assignment. Any assignment contrary to the terms of this Article XIV
shall be null and void and of no force and effect. In no event shall the
assignment by Motient Services or Newco of such party's respective rights or
obligations under this Agreement, whether before, at or after the Closing (as
defined in the Asset Sale Agreement), release such party from such party's
respective liabilities and obligations hereunder.
ARTICLE Xv
MISCELLANEOUS PROVISIONS
15.1 Successors and Assigns.
This Agreement shall be binding upon and shall inure to the benefit of the
parties hereto and their permitted assigns. This Agreement is entered into
solely for the benefit of such parties.
15.2 No Third Party Beneficiaries.
The provision by Motient Services to Newco of the Satellite Network and of the
Services is not part of any principal and agent relationship, employer and
employee relationship, or joint venture or partnership between Motient Services
and Newco. This Agreement is entered into solely for the benefit of Motient
Services and Newco and is for the exclusive benefit of such parties. Nothing
contained in this Agreement will be deemed to create any third party
beneficiaries or confer any benefit or rights on or to any person not a party
hereto, and no person not a party hereto (including, without limitation,
customers, vendors, or creditors of Newco) shall be entitled to enforce any
provisions hereof or exercise any rights hereunder.
15.3 Notices.
All notices, demands, requests, or other communications which may be or are
required to be given, served, or sent by any party to any other party pursuant
to this Agreement shall be in writing and shall be hand delivered, sent by
overnight courier or mailed by first-class, registered or certified mail, return
receipt requested, postage prepaid, or transmitted by telecopy addressed as
follows:
(a) If to Newco:
Motient Satellite Ventures LLC
10802 Parkridge Boulevard
Reston, Virginia 20191-5416
Attn: Randy S. Segal, Esq.
Telecopy No.: 703-758-6134
with a copy to:
Motient Satellite Ventures LLC
211 North Union Street, Suite 300
Alexandria, Virginia 22314
Attn: Hal Perkins
Telecopy No.: 703-706-3801
(b) If to Motient Services:
Motient Services Inc.
10802 Parkridge Boulevard
Reston, Virginia 20191-5416
Attn: Randy S. Segal, Esq.
Telecopy No.: 703-758-6134
Each party may designate by notice in writing a new address to which any notice,
demand, request or communication may thereafter be so given, served or sent.
Each notice, demand, request, or communication which shall be hand delivered,
sent, mailed or telecopied in the manner described above shall be deemed
sufficiently given, served, sent, received or delivered for all purposes at such
time as it is delivered to the addressee (with the return receipt, the delivery
receipt, or (with respect to a telecopy or telex) the answerback being deemed
conclusive, but not exclusive, evidence of such delivery) or at such time as
delivery is refused by the addressee upon presentation.
15.4 Applicable Law.
This Agreement shall be governed by and construed in accordance with the laws of
the Commonwealth of Virginia, without regard to its principles of conflicts of
law that would give effect to the application of the law of another
jurisdiction. Each of the parties hereto hereby irrevocably and unconditionally
consents to submit to the exclusive jurisdiction of the courts of the
Commonwealth of Virginia and of the United States of America, in each case
having jurisdiction over the County of Fairfax, for any litigation arising out
of or relating to this Agreement and the transactions contemplated hereby and
thereby (and agrees not to commence any litigation relating thereto except in
such courts), and further agrees that service of any process, summons, notice or
document by U.S. registered mail to its respective address set forth in this
Agreement shall be effective service of process for any litigation brought
against it in any such court. Each of the parties hereto hereby irrevocably and
unconditionally waives any objection to the laying of venue of any litigation
arising out of this Agreement or the transactions contemplated hereby in the
courts of the Commonwealth of Virginia or the United States of America, in each
case having jurisdiction over the County of Fairfax, and hereby further
irrevocably and unconditionally waives and agrees not to plead or claim in any
such court that any such litigation brought in any such court has been brought
in an inconvenient forum.
15.5 Waiver.
Neither the waiver by either of the Parties hereto of a breach of or a default
under any of the provisions of this Agreement, nor the failure of either of the
Parties, on one or more occasions to enforce any of the provisions of this
Agreement or to exercise any right or privilege hereunder shall thereafter be
construed as a waiver of any subsequent breach of default of a similar nature,
or as a waiver of any provisions, rights, or privileges hereunder. Any waiver
under this Agreement must be in writing.
15.6 Severability.
In the event that any one or more of the provisions of this Agreement shall be
held by a court of competent jurisdiction to be invalid or unenforceable in any
respect, such invalidity and unenforceability shall not affect any other
provision of this Agreement, and the Agreement shall be construed as though such
invalid and/or unenforceable provision(s) had never been contained herein,
unless such invalid and/or unenforceable provision(s) are an essential part of
the agreed exchange.
15.7 Modification.
No amendment or modification to this Agreement shall be valid unless made in
writing and signed by the authorized representatives of the parties. As to
Motient Services, the "authorized representatives" means both Motient Services'
(a) General Counsel and (b) President or any Vice President.
15.8 Headings.
The headings and numbering of paragraphs in this Agreement are for convenience
only and shall not be construed to define or limit any of the terms herein or
affect the meaning of interpretation hereof.
15.9 Survival.
The provisions of Sections 4.4, 8.1, 8.2, 8.3, 8.4 (to the extent the license
granted therein becomes perpetual), 8.5, 11.5, 15.2, 15.4, 15.8, and 15.9 and
Articles V, IX, X (subject to Section 12.1), XII, XIII and XV shall survive
expiration or termination of this Agreement.
15.10 No Joint Venture or Agency.
Neither Party will be deemed to be an employee, agent, partner or legal
representative of the other for any purpose and neither will have any right,
power or authority to create any obligation or responsibility on behalf of the
other.
15.11 Force Majeure.
Motient Services shall not be liable for any failure of performance due to
causes beyond its reasonable control, including, but not limited to, acts of
God, fires, floods or other catastrophes; national emergencies, insurrections,
riots or wars; strikes, lockouts, work stoppages or other labor difficulties;
and any law, order, regulation or other action of any governing authority or
agency thereof (collectively, "Force Majeure Events"). A failure of performance
by Motient Services caused solely by acts or omissions of Motient Corporation or
any of its Affiliates (except to the extent such acts or omissions are
themselves due to a Force Majeure Event) or by reason of Motient Services'
insolvency or bankruptcy or other such condition of financial distress shall not
be deemed to be a Force Majeure Event with respect to Motient Services.
15.12 Entire Agreement.
This Agreement, including all Schedules hereto, and the Asset Sale Agreement,
constitutes the entire agreement between the parties hereto and supersedes all
prior oral or written agreements, representations, statements, negotiations,
understandings, proposals, and undertakings with respect to the subject matter
hereof.
IN WITNESS WHEREOF, the Parties hereto have caused this
Research and Development Agreement to be executed on the date first written
above by their duly authorized officers.
MOTIENT SATELLITE VENTURES LLC
By Motient Corporation, Sole Member
By: /s/Gary M. Parsons
Gary M. Parsons
Chairman
MOTIENT SERVICES INC.
By: /s/Gary M. Parsons
Gary M. Parsons
Chairman
SCHEDULE A
FACILITIES REQUIREMENTS
Newco's access to the Satellite Network for the purposes of this
Agreement shall be subject to its compliance with the following Facilities
Requirements:
(1) Compliance with Motient Services requirements and standards: Newco
will adhere to Motient Services' standard interfacing requirements and
specifications when interconnecting external equipment and facilities to the
Satellite Network. Newco's activities under this Agreement shall comply with
Motient Services' acceptable use policy and other applicable policies, rules and
regulations (including without limitation those promulgated by the FCC) that are
intended to protect the integrity of the Satellite Network, to prevent unlawful
or improper use of the Satellite Network, and to prevent harm to Motient
Services' personnel. Notwithstanding the generality of the foregoing, Newco
shall adhere to Motient Services' IF Interface Access Requirements, as in effect
from time to time. Motient Services reserves the right to change such
requirements from time to time, upon reasonable notice to Newco.
(2) Licenses and permits: Newco shall be responsible for obtaining
those licenses, permits, rights-of-way, approvals, and any other arrangements
for which it is responsible, as set forth in Section 6.2. Motient Services
agrees to provide Newco with reasonable cooperation and assistance to enable
Newco to obtain such licenses, permits, rights-of-way, approvals and other
arrangements. Newco agrees that, unless otherwise requested in writing by Newco,
all of Newco's governmental approvals and licensing activities will be conducted
by Motient Services' regulatory counsel; provided that Motient Services'
regulatory counsel will handle requests by Newco for Motient Services to obtain
licenses, permits, approvals and other such items for which Newco is
responsible, as provided for in Section 6.2.
(3) Motient Services right of access: For the protection of Motient
Services' network, services, facilities and personnel, Newco hereby grants
Motient Services the right at any time, and from time to time, upon reasonable
prior notice except in the case of an emergency, to inspect all equipment and
communications facilities or services used or provided by Newco for use with
Motient Services' mobile satellite system for compliance with FCC regulations,
this Agreement, and Motient Services' emission requirements, and other technical
requirements.
SCHEDULE B
COMPENSATION FOR SERVICES
Unless agreed otherwise by the parties from time to time, Motient Services shall
be compensated by Newco for the Services to be provided under the Agreement, in
accordance with this Schedule B.
Motient Services shall not charge Newco for the following Services:
(i) assistance to Newco in establishing access and/or connectivity of
Newco and/or Newco mobile terminals and other equipment to the Satellite
Network;
(ii) provision of technical descriptions of the Satellite Network and
descriptions and explanations of Motient Services' technical and
operational requirements for Newco's use of the Satellite Network;
(iii) restart of Newco's uplink equipment in the event of an equipment
failure, pursuant to procedures to be defined in the R&D Support Plan or
another document; and
(iv) other similar services and assistance of a general nature, not
focused on a particular R&D Activity or other special project.
In the event Newco requests in writing for Motient Services to provide any major
or extraordinary technical assistance required for Newco to perform its R&D
Activities, including but not limited to consulting, engineering, strategic,
technical or similar Services provided in support of the R&D Activities, Motient
Services shall be: (a) compensated for Motient Services employees at the rates
set forth below, plus reimbursement for reasonable out-of-pocket expenses; (b)
compensated for third party consultants and other personnel engaged by Motient
Services for Newco (at written request of Newco) at Motient Services' actual
costs, plus reimbursement for reasonable out-of-pocket expenses and (c)
reimbursed, at Motient Services' cost, for equipment requested to be purchased
by Newco in connection with the Services.
The billing rates are as follows:
Hourly Rate
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Senior Engineering/
Technical/Regulatory $ 135
Junior Engineering/
Technical/Regulatory $ 90
Motient Services shall submit an invoice for all Services rendered for which
compensation is due, within thirty (30) days following the end of the month in
which such Services were provided. Such invoice shall include a brief
description of the Services rendered, indicating the amount charged for each
Service rendered. Invoices shall be payable by Newco within thirty (30) days of
the invoice date.