EXECUTION COPY
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AMENDED AND RESTATED
ASSET SALE AGREEMENT
BETWEEN
MOBILE SATELLITE VENTURES LLC
AND
MOTIENT SERVICES INC.
DATED AS OF
January 8, 2001
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TABLE OF CONTENTS
Page
1.
DEFINITIONS............................................................1
2. CLOSING OF ASSET
SALE...................................................................1
2.1. Sale of
Assets........................................................1
2.2. Purchase Price; Initial
Payment.......................................................2
2.3. Description of Subject
Assets........................................................2
2.4. Excluded Assets; Unassignable
Contracts.....................................................5
2.5. Assumption of Specified
Liabilities...................................................6
2.6. Closing; Closing
Date..........................................................7
2.7. Agreement on Disposition of Purchase
Price.........................................................7
3. ADDITIONAL UNDERTAKINGS AND
COVENANTS..............................................................9
3.1. Consents and
Approvals.....................................................9
3.2. Operation of Business of Motient
Services.....................................................10
3.3.
Disclosure...................................................11
3.4. News
Releases.....................................................11
3.5.
General......................................................11
3.6. Bulk Sales
Laws.........................................................12
3.7. Access to Information; Basic Financial
Information..................................................12
3.7.1. Access to
Information..........................................12
3.7.2. Basic Financial
Information..........................................12
3.8. Covenant to Perform Certain
Obligations..................................................13
3.9. Update of Disclosure
Schedules....................................................14
4. REPRESENTATIONS AND WARRANTIES OF MOTIENT
SERVICES..............................................................14
4.1. Organization and
Standing.....................................................14
4.2.
Subsidiaries.................................................15
4.3.
Noncontravention.............................................15
4.4. Real
Property.....................................................15
4.5.
Assets.......................................................15
4.6.
Insurance....................................................16
4.7. Intellectual
Property.....................................................16
4.8. Debt
Instruments..................................................16
4.9.
Leases.......................................................16
4.10. Material
Agreements...................................................17
4.11. Litigation;
Disputes.....................................................18
4.12. Labor Relations;
Employees....................................................18
4.13.
Taxes........................................................19
4.14. Restrictions and
Consents.....................................................19
4.15.
Authorization................................................19
4.16. Absence of
Violation....................................................20
4.17. Binding
Obligation...................................................20
4.18. Financial
Statement....................................................20
4.19. Absence of Undisclosed
Liabilities..................................................20
4.20. Material Adverse
Change.......................................................21
4.21. Assets Used in Satellite Communications
Business.....................................................21
4.22.
Licenses.....................................................21
4.23. Transactions with
Affiliates...................................................21
4.24. Employee Benefit
Plans........................................................21
4.25. Environmental
Matters......................................................22
5. REPRESENTATIONS AND WARRANTIES OF
NEWCO.................................................................23
5.1. Organization and
Standing.....................................................23
5.2.
Authorization................................................23
5.3. Binding
Obligation...................................................23
6. CONDITIONS PRECEDENT TO OBLIGATIONS OF MOTIENT
SERVICES..............................................................24
6.1.
Performance..................................................24
6.2. Legal
Proceedings..................................................24
6.3. Newco's
Certificate..................................................24
6.4. Contemporaneous
Closing......................................................24
7. CONDITIONS PRECEDENT TO OBLIGATIONS OF
NEWCO.................................................................24
7.1.
Performance..................................................25
7.2. Legal
Proceedings..................................................25
7.3. Officer's
Certificate..................................................25
7.4. Contemporaneous
Closing......................................................25
8.
Closing...............................................................25
8.1. Deliveries by Motient
Services.....................................................25
8.2. Deliveries by
Newco........................................................26
8.3. Transferred
Employees....................................................26
8.4. Transitional and Ongoing
Matters......................................................27
8.5. Shared Assets; Parent
Guaranties...................................................28
8.6. Motient Resale of Newco Products and
Services.....................................................29
8.7. Use of
Proceeds.....................................................29
8.8. Insurance Proceeds from Satellite
Failure......................................................29
8.9. Loss of FCC
Licenses.....................................................30
8.10. Reduction in the Refund
Amount.......................................................30
9. SURVIVAL OF REPRESENTATIONS; INDEMNIFICATION;
REMEDIES..............................................................31
9.1. Survival of
Representations..............................................31
9.2. Agreement of Motient Services to
Indemnify....................................................31
9.3. No Duplication of
Remedies.....................................................31
9.4. Agreement of Newco to
Indemnify....................................................32
9.5. Notice of
Claims.......................................................32
9.6. Limitations on
Amounts......................................................33
9.7. Force
Majeure......................................................33
9.8.
Subrogation..................................................34
10.
TERMINATION...........................................................34
10.1.
Termination..................................................34
10.2. Effect of
Termination..................................................34
11.
MISCELLANEOUS.........................................................34
11.1. Additional Actions and
Documents....................................................34
11.2. No
Brokers......................................................35
11.3.
Expenses.....................................................35
11.4.
Assignment...................................................35
11.5. Entire Agreement;
Amendment....................................................35
11.6.
Waiver.......................................................36
11.7.
Severability.................................................36
11.8. Governing
Law..........................................................36
11.9.
Notices......................................................37
11.10.
Headings.....................................................38
11.11. Interpretation; Absence of
Presumption..................................................38
11.12. Execution in
Counterparts.................................................38
11.13. Limitation on
Benefits.....................................................39
11.14. Binding
Effect.......................................................39
AMENDED AND RESTATED ASSET SALE AGREEMENT
This AMENDED AND RESTATED ASSET SALE AGREEMENT (this "Amended
Sale Agreement") is entered into as of January 8, 2001 by and between Mobile
Satellite Ventures LLC, a Delaware limited liability company (formerly named
Motient Satellite Ventures LLC)("Newco"), and Motient Services Inc., a Delaware
corporation ("Motient Services").
WHEREAS, Motient Services is engaged in the business of
providing satellite communications services in the United States and surrounding
waters and airspace and has a license to provide such services in the 1530-1559
MHz and 1631.5-1660.5 MHz band, but excluding the Transportation Business (as
defined below) (the "Satellite Communications Business");
WHEREAS, the parties entered into an Asset Sale Agreement on
June 29, 2000 (the "Asset Sale Agreement"), pursuant to which Motient Services
agreed to sell and Newco agreed to purchase certain of the assets and assume
certain of the liabilities of the Satellite Communications Business;
WHEREAS, the parties entered into Amendment No. 1 to the Asset
Sale Agreement dated as of November 29, 2000 to reflect the sale by Motient
Services of certain assets used by Motient Services in connection with the
business of providing wireless data communications in the Transportation Market
(the "Transportation Business") to Aether Systems, Inc. ("Aether") pursuant to
an Asset Sale Agreement dated November 29, 2000 between Motient Services and
Aether (the "Aether Sale Agreement"); and
WHEREAS, the parties desire to amend and restate the Asset
Sale Agreement to reflect the sale of the Transportation Business to Aether and
to make certain other changes as set forth herein.
NOW, THEREFORE, in consideration of the foregoing and of the
mutual covenants and agreements set forth herein, the parties, intending to be
legally bound, hereby amend and restate the Asset Sale Agreement, as amended, as
follows:
1. DEFINITIONS
For all purposes of this Amended Sale Agreement, certain
capitalized terms not otherwise defined herein shall have the meanings set forth
on Exhibit A.
2. ClosING OF ASSET SALE
2.1. Sale of Assets.
On the basis of the representations, warranties and agreements
contained herein, and subject to the terms and conditions hereof, Motient
Services agrees to sell, assign, transfer, convey and deliver to Newco, and
Newco agrees to purchase from Motient Services, the Subject Assets at the
Closing (as defined in Section 2.6 hereof) free and clear of all Claims or
Encumbrances other than the Assumed Liabilities. At Newco's election, in lieu of
transferring the Licenses and/or the Applications to Newco at Closing pursuant
to this Section 2.1, Motient Services shall transfer the Licenses and/or the
Applications to a wholly-owned subsidiary of Newco at Closing.
2.2. Purchase Price; Initial Payment.
(a) For and in consideration of the conveyances and assignments
described herein and in addition to the assumption of the Assumed Liabilities as
set forth in Section 2.5, Newco agrees to pay to Motient Services, and Motient
Services agrees to accept from Newco, the Purchase Price which shall be payable
as follows:
(i) Newco previously paid the amount of Twenty Four Million
Dollars ($24,000,000) in cash to Motient Services (the "Initial Payment") which
is non-refundable except in connection with (and to the extent of) Motient
Services' obligation to indemnify hereunder and except as otherwise expressly
set forth in this Amended Sale Agreement;
(ii)At the Closing, Newco shall pay Forty Five Million Dollars
($45,000,000) to Motient Services by wire transfer of immediately available
funds in accordance with Motient Services' wiring instructions; and
(iii) At the Closing, Newco shall deliver a promissory note to
Motient Services substantially in the form attached hereto as Exhibit B in the
principal amount of Fifteen Million Dollars ($15,000,000)(the "Note").
(b) Motient Services shall have no obligation to hold or
otherwise retain the Initial Payment in escrow and Motient Services shall have
the right to use and apply the Initial Payment in its sole discretion.
2.3. Description of Subject Assets
All of the assets that relate to the Satellite Communications
Business shall be the "Subject Assets", excluding in all events, the Excluded
Assets (as hereinafter defined). The Subject Assets include, but are not limited
to:
(a) the satellite described on Schedule 2.3(a) and any replacement thereof
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(the "Satellite");
(b) subject to regulatory approval, all of Motient Services' rights in any
licenses issued by the FCC, and all other licenses, permits, franchises and
similar authorizations held by Motient Services, in connection with the
Satellite Communications Business (the "Licenses"), and all of Motient Services'
rights in any pending applications for telecommunications and/or Satellite
licenses filed by Motient Services with any regulatory body in connection with
the Satellite Communications Business ("Applications");
(c) all of Motient Services' rights in customer contracts relating to (i) voice
services, including but not limited to nationwide dispatch service and satellite
telephone service and (ii) private network customers purchasing bulk satellite
capacity (the "Customer Contracts");
(d) all of Motient Services' rights in the dealer contracts relating to the
Satellite Communications Business (the "Dealer Contracts");
(e) all of Motient Services' rights in the distributor, sale, agent and reseller
contracts with Stratos relating to the Satellite Communications Business (the
"Stratos Contracts");
(f) subject to Section 8.4 hereof and the Landlord's consent, all of Motient
Services' rights and obligations under the Deed of Lease (the "Lease"), dated
February 4, 1993, as amended, between Motient Services and APA Properties No. 10
LP (the "Landlord") for the premises located at 10802 Parkridge Boulevard,
Reston, Virginia (the "Reston Facility");
(g) all of Motient Services' rights in the other leases, license agreements,
contracts, agreements, sales orders, purchase orders, open bids and other
commitments primarily relating to the Satellite Communications Business,
including but not limited to (i) agreements relating to telemetry, tracking and
control services, (ii) agreements relating to back-up antenna support, (iii)
supply, distribution and software maintenance agreements, (iv) administrative
services agreements, (v) cross-licensing agreements (including the
Cross-Licensing Agreement), (vi) reciprocal business arrangements, (vii) leases
relating to real property, (viii) the Aether IP License (as defined in Section
2.5(a)) but only to the extent described in Section 2.5(a), and (ix) the Land
Earth Station Services Agreement (the "LES Agreement") dated November 29, 2000
between Motient Services and Aether (collectively, the "Other Contracts" and
together with the Customer Contracts, the Dealer Contracts, the Stratos
Contracts and the Lease, the "Contracts");
(h) all machinery, fixtures, equipment, furniture, furnishings, supplies,
computers, computer systems and computer support equipment, and all other
tangible personal property, used primarily in connection with the Satellite
Communications Business including, but not limited to, all of the equipment and
personal property comprising Motient Services' land earth stations
(collectively, the "Personal Property");
(i) all of Motient Services' rights under the contracts, agreements and
arrangements with employees of Motient Services whose employment is
substantially related to the Satellite Communications Business;
(j) all of Motient Services' rights in the patents, trademarks, copyrights,
licenses to use patents, trademarks or copyrights of third parties, patent or
trademark or copyright applications or registrations, trade names, service
marks, applications, logos, slogans (and all goodwill relating to the foregoing
trade names, service marks, trademarks, trademark applications, logos and
slogans), computer code and software, trade secrets, know how, customer lists
and proprietary information relating to the Satellite Communications Business
(the "Intellectual Property");
(k) all stock and other outstanding equity securities owned by Motient Services;
(l) all inventory, work-in-progress, raw materials, parts, stores, spare parts,
repair parts, test units, samples, components, accessories and supplies related
to the Satellite Communications Business;
(m) the prepaid expenses, deposits and retentions of Motient Services related to
the Satellite Communications Business;
(n) all goodwill and going concern value of the Satellite Communications
Business;
(o) all rights or Claims of Motient Services arising out of the breach of any
express or implied warranties by third parties relating to any of the foregoing
assets or any component part thereof;
(p) all security deposits and letters of credit provided to Motient Services
from certain customers of the Satellite Communications Business;
(q) all rights of Motient Services as a creditor in the bankruptcy proceedings
listed in Schedule 2.3(q) to the extent such rights are still in existence at
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the Closing;
(r) the satellite in-orbit insurance policy and all other insurance policies
substantially related to the Satellite Communications Business;
(s) all rights of Motient Services to any Claims, ongoing or potential against
any third parties arising out of or related to the Satellite Communications
Business;
(t) except as provided in Section 2.4 (a)(vi) below, all accounts receivable of
the Satellite Communication Business, whether such rights are matured or
unmatured, fixed or contingent, as of the Closing Date;
(u) the cash, cash equivalents or marketable securities held by or deposited
with any financial institution in connection with the letters of credit issued
on behalf of Motient Services;
(v) all assets reflected on the Financial Statement, other than Excluded Assets,
assets disposed of in compliance with this Amended Sale Agreement and the Shared
Assets listed on Schedule 2.3(v) of the Disclosure Schedule; and
(w) all proceeds from and rights related to insurance policies relating to the
Subject Assets, the Assumed Liabilities and the Satellite Communications
Business for losses incurred in connection with events occurring prior to
Closing.
2.4. Excluded Assets; Unassignable Contracts
(a) "Excluded Assets" consist of (i) Motient Services'
corporate charter, qualifications to conduct business as a foreign corporation,
arrangements with registered agents relating to foreign qualifications, taxpayer
and other identification numbers, seals, minute books, stock transfer books,
blank stock certificates, and other documents relating solely to the
organization, maintenance or existence of Motient Services as a corporation,
(ii) Motient Services' rights with respect to Intercompany Agreements (as
defined herein), (iii) except as provided in Sections 2.3(p)(t) and (u) hereof,
cash and cash equivalents (including without limitation the Purchase Price),
(iv) the Shared Assets, (v) Motient Services' rights to and interests in the
trademark "Motient," the Motient logo and all goodwill related thereto, (vi)
that portion of the accounts receivable of Motient Services that relate to
federal, state and local excise, sales and use taxes required to be paid by
Motient Services under Section 2.5(b)(xiii) hereof and, (vii) the assets listed
on Schedule 2.4. Notwithstanding anything else in this Amended Sale Agreement to
the contrary, in addition to the foregoing, the Excluded Assets shall include
(A) all consideration received or to be received by Motient Services and/or any
of its Affiliates pursuant to the Aether Sale Agreement, the Escrow Agreement
dated November 29, 2000 between Motient Services and Aether, and (B) the first
Eight Million Eight Hundred Thousand Dollars ($8,800,000) in consideration
payable to Motient Services pursuant to the Private Network Satellite Services
Agreement dated November 29, 2000 between Motient Services and Aether (the
"Aether Satellite Network Agreement").
(b) Notwithstanding anything else in this Amended Sale
Agreement to the contrary, this Amended Sale Agreement shall not constitute an
agreement to assign or transfer any Subject Asset or part thereof or any rights
or benefit arising thereunder or resulting therefrom if an attempted assignment
or transfer thereof, without the consent of a third party thereto, would
constitute a breach thereof, or make Newco, Motient Services or any of their
respective Affiliates liable for damages or other penalties thereunder (although
the obligations of Motient Services thereunder shall remain Assumed Liabilities
for all purposes of this Amended Sale Agreement). If such consent is not
obtained, or if an attempted assignment thereof would be ineffective or would
affect the rights of Newco or Motient Services so that Newco would not in fact
receive all such rights, Motient Services (i) shall cooperate with Newco, at
Newco's request, in endeavoring to obtain such consent and (ii) if any such
consent is unobtainable, shall hold any such Subject Asset or part thereof in
trust for Newco and shall cooperate with Newco in an arrangement designed to
provide to Newco, at Newco's expense, the benefits and liabilities following
Closing with respect to any such Subject Asset or part thereof or any right or
benefit arising thereunder or resulting therefrom, including enforcement for the
benefit of Newco of any and all rights of Motient Services against a third party
arising out of the breach or cancellation by such third party or otherwise;
provided, that such arrangement shall provide for indemnification by Newco of
Motient Services, reasonably acceptable to Motient Services, against any
liability arising out of such arrangement. Nothing in this Section 2.4(b) shall
be deemed to require Newco to waive any condition to Closing relating to
obtaining consents of third parties. Motient Services and Newco shall from time
to time after the Closing Date execute and deliver to the other such further
instruments and other written assurances and documents as may be reasonably
required in order to perfect the transfer of any of the Subject Assets to Newco,
or to ensure that Newco is entitled to the benefits of the Subject Assets.
2.5. Assumption of Specified Liabilities
(a) At the Closing, Newco shall assume only the following
liabilities and obligations of the Satellite Communications Business (the
"Assumed Liabilities"): all liabilities and indebtedness relating to the Subject
Assets (other than those incurred in violation of this Amended Sale Agreement
and those excluded in Section 2.5(b)), including but not limited to (i)
equipment and insurance financing, (ii) performance payments to Hughes relating
to satellite manufacture, except those amounts accrued and/or unpaid as of
Closing; provided, that any dispute as to the amount of any such accrued and/or
unpaid amounts shall be controlled by Motient Services, (iii) the SPAR
litigation, (iv) warranty obligations to customers under customer service
contracts assumed by Newco, (v) accounts payable of the Satellite Communications
Business, whether such obligations are matured or unmatured, fixed or
contingent, as of the Closing Date, (vi) all Claims by customers, vendors,
suppliers, Transferred Employees (relating to post-Closing periods only) and
similar Claims, relating to any of the Subject Assets or the Satellite
Communications Business, and (vii) any and all termination penalties under any
contracts assigned to Newco that Newco chooses to terminate. Notwithstanding
anything contained in this Amended Sale Agreement to the contrary, the Assumed
Liabilities shall include (A) all ongoing service, warranty, and other
obligations and liabilities of Motient Services to Aether under the Aether
Satellite Network Agreement, notwithstanding the fact that the first Eight
Million Eight Hundred Thousand Dollars ($8,800,000) in consideration payable by
Aether pursuant to such agreement shall be retained by Motient Services, as
provided in Section 2.4(a) above, and (B) all of the obligations and liabilities
of Motient Services under the Intellectual Property License Agreement dated
November 29, 2000 between Motient Services and Aether (the "Aether IP License"),
but only to the extent such obligations and liabilities relate to the
Intellectual Property that is being transferred to Newco pursuant to this
Amended Sale Agreement. Motient Services and Newco shall from time to time after
the Closing Date execute and deliver to the other such further instruments and
other written assurances and documents as may be reasonably required in order to
evidence the foregoing assumption by Newco of the Assumed Liabilities.
(b) The Assumed Liabilities shall not include, and Newco shall
not assume or be deemed to assume, and Motient Services shall remain responsible
for, any and all debts, liabilities or obligations of Motient Services (or any
officer, director, employee or shareholder of any of the foregoing) of the
following types: (i) liabilities that were required to be disclosed on the
Disclosure Schedule (or the updated Disclosure Schedule) which were not so
disclosed, (ii) all taxes Motient Services is responsible for under the last
sentence of Article V of the R&D agreement, (iii) liabilities and obligations to
Motient Corporation or any of its direct or indirect Subsidiaries (except those
obligations set forth in the Cross-Licensing Agreement), (iv) indebtedness
incurred under and guaranties related to any bank or credit facilities of
Motient Corporation, Motient Holdings Inc. or any other entity other than
Motient Services, including, but not limited to, the Revolving Credit Agreement,
dated as of March 31, 1998, among Motient Corporation, Motient Holdings, Inc.,
and the banks and the other parties named therein, as amended, and the Term
Credit Agreement, dated as of March 31, 1998, among Motient Corporation and the
banks and other parties named therein, as amended, (v) liabilities and
obligations arising out of or relating to (including guaranties of) indebtedness
for borrowed money (except for indebtedness for borrowed money permitted to be
incurred under Section 3.2(c)(ii) hereof), including, but not limited to the
Indenture and the Senior Notes (as defined in Section 4.15 below); (vi) any
liability arising out of a breach of this Amended Sale Agreement, the R&D
Agreement or any Agreement or document delivered in connection herewith or
therewith, including, without limitation, the Investment Agreement or the
Ancillary Agreements (as defined in the Investment Agreement), (vii) except as
otherwise provided herein or therein, any expenses contemplated by this Amended
Sale Agreement, the Investment Agreement or the Ancillary Agreements, including
any costs directly associated with the Closing, including but not limited to
legal and accounting fees, (viii) performance payments to Hughes relating to
satellite manufacture to the extent accrued and/or unpaid as of Closing;
provided, that any dispute as to the amount of any such accrued and/or unpaid
amounts shall be controlled by Motient Services, (ix) any liability to those
former employees of the Satellite Communication Business whose employment was
terminated on or prior to the Closing Date and who are eligible to receive COBRA
benefits under Section 4980B of the Code, (x) any liabilities under any contract
of Motient Services not included in the Subject Assets or any termination
payments or other damages payable with respect to an unassigned contract not
disclosed to Newco, (xi) any Liability of Motient Services for the unpaid Taxes
of any Person (other than Motient Services) under Treas. Reg. Section 1.1502-6
(or any similar provision of state, local or foreign law), as a transferee or
successor by contract, or otherwise, (xii) any liability for employee bonuses or
other similar incentive payments at or prior to Closing, and (xiii) any
Liability of Motient Services for unpaid Taxes with respect to any Tax year or
portion thereof ending on or before the Closing Date; including for state and
local excise, sales and use taxes paid on a monthly basis, with respect to which
Motient Services shall be liable for such Taxes with respect to sales made prior
to the Closing Date.
2.6. Closing; Closing Date.
The closing of the sale of the Subject Assets to Newco and the
assumption of the Assumed Liabilities by Newco (the "Closing" and the date
thereof being sometimes hereinafter referred to as the "Closing Date") shall be
as soon as reasonably practicable (and in any event no later than 30 calendar
days) after the satisfaction or waiver of the conditions precedent set forth in
Sections 6 and 7. The Closing shall be held at the offices of Kirkpatrick &
Lockhart, 1251 Avenue of the Americas, New York, New York, or at such other
location as the parties may mutually agree upon.
2.7. Agreement on Disposition of Purchase Price
(a) Motient Services hereby agrees that the amount of the
Purchase Price, together with the assumption of the Assumed Liabilities,
constitutes adequate and sufficient consideration for the transfer to Newco of
all interests held by Motient Services in and to the Subject Assets and for the
performance by Motient Services of all of its covenants and agreements
hereunder.
(b) Newco shall pay all federal, state and local franchise,
sales, use, real property, personal property, ad valorem duties and excise taxes
payable in regard to the sale, assignment, transfer, conveyance or delivery of
the Subject Assets by Motient Services to Newco hereunder. Motient Services
shall pay or otherwise be liable for (and shall indemnify and hold harmless
Newco and its subsidiaries) on account of any income taxes payable by Motient
Services or Motient Corporation which arise out of the sale, assignment,
transfer, conveyance, and delivery of the Subject Assets by Motient Services to
Newco hereunder.
(c) Newco and Motient Services agree to use reasonable
commercial efforts to reach agreement on the fair market value of (i) the
consideration received by Motient Services for the sale of the Subject Assets;
and (ii) each Subject Asset or class of Subject Asset within 60 days after the
Closing Date. To the extent that the parties are unable to agree on such fair
market value for any or all of the consideration or Subject Assets, the
determination of such fair market value shall be made as follows:
(i) No later than 60 days (or such later date as
the parties mutually agree) following the Closing Date, Newco shall cause an
appraiser (the "Appraiser"), which shall be reasonable acceptable to Motient
Services to provide to Newco and Motient Services an appraisal of the fair
market valuations of such components of the consideration or such Subject Assets
as were not otherwise agreed to pursuant to this Section 2.7(c) (the
"Appraisal"). For purposes of this Section 2.7(c), the "fair market value" shall
mean the amount a willing buyer would pay to a willing seller for the actual
property in question (not calculated based solely upon the replacement cost of
such property) in an arm's length transaction where each such party to the
transaction has full knowledge of all relevant information concerning such
property.
(ii) Each of Motient Services and Newco may
provide the Appraiser with such information as it believes will be useful to the
Appraiser in preparing the Appraisal. Copies of any written materials provided
to the Appraiser by either Motient Services or Newco shall simultaneously be
provided to the other party. All oral communication with the Appraiser shall be
made through Newco, which shall provide Motient Services with reasonable
opportunities to speak to and meet the Appraiser to express any views and
opinions Motient Services reasonably believes are pertinent to the preparation
of the Appraisal.
(iii) Newco shall pay the basic fee of the Appraiser
as set at the time that the Appraiser is initially engaged by Newco. To the
extent that any additional fees, costs or expenses are incurred as a result of
documents provided by Motient Services, communications initiated by Motient
Services or meetings held at Motient Services' request, Motient Services shall
pay such additional fees, costs or expenses.
(iv) The fair market valuations of the consideration
and of the Subject Assets determined by the Appraiser pursuant to this Section
2.7(c) shall be the fair market valuations of such consideration and Subject
Assets for federal income tax purposes, and shall be binding upon Motient
Services and Newco as provided in this Amended Sale Agreement.
(v) Motient Services and Newco agree to use the
values determined pursuant to the Appraisal in any tax filing made by either of
them, and in any financial statement prepared by them for the period in which
this purchase and sale occurs. In the event that a tax authority subsequently
determines that a value allocated to all or any of the Subject Assets is
different than that agreed to by Motient Services and Newco, and Motient
Services and Newco agree to such determination, then the value so determined
shall be deemed to have been the value agreed to for such asset or assets ab
initio. In the event that Motient Services and Newco do not agree to such
determination by a tax authority and the matter proceeds to a court or similar
body, the value of such asset or assets shall be deemed ab initio to be the
value determined by such court or similar body upon all rights of appeal being
finally exhausted.
3. ADDITIONAL UNDERTAKINGS AND COVENANTS
Newco, on the one hand, and Motient Services, on the other
hand, hereby covenant and agree with each other as follows:
3.1. Consents and Approvals
(a) Newco and Motient Services shall use all commercially reasonable efforts to
secure such consents, authorizations and approvals of governmental and
supragovernmental authorities including but not limited to the FCC and of
private individuals or entities with respect to the transactions contemplated by
this Amended Sale Agreement, and to the performance of all other obligations of
such parties hereunder, as may be required by any applicable statute or
regulation of the United States or any country, state or other jurisdiction or
by any Agreement of any kind whatsoever to which Newco or Motient Services is a
party or by which Newco or Motient Services is bound. Each party shall be
responsible for any expenses incurred relating to obtaining such consents,
authorizations and approvals for which such party bears the responsibility of
obtaining.
(b) Newco and Motient Services shall (i) cooperate in the filing of all forms,
notifications, reports and information, if any, required or reasonably deemed
advisable pursuant to applicable statutes, rules, regulations or orders of any
governmental or supragovernmental authority in connection with the transactions
contemplated by this Amended Sale Agreement and (ii) use all commercially
reasonable efforts to cause any applicable waiting periods thereunder to expire
and any objections to the transactions contemplated hereby to be withdrawn
before the Closing.
(c) In addition to the obligations set forth in Section 3.1(b), as promptly as
practicable, and in any event no later than thirty (30) business days after the
date hereof, Motient Services and Newco shall complete any filing that may be
required pursuant to Hart-Scott-Rodino, or shall mutually agree that no such
filing is required. Motient Services and Newco shall diligently take (or fully
cooperate in the taking of) all actions, and provide any additional information,
required or reasonably requested in order to comply with the requirements of
Hart-Scott-Rodino. Each party shall pay any Hart-Scott-Rodino filing fees
payable in connection with any Hart-Scott-Rodino filing required to be made by
such party.
3.2. Operation of Business of Motient Services
(a) Motient Services shall, through the Closing Date, (i) use all commercially
reasonable efforts to substantially preserve its business organization,
including, without limitation all licenses, permits or other governmental
authorizations to conduct its business, (ii) operate the Satellite
Communications Business in the ordinary course of business consistent with past
practice, (iii) substantially maintain its present relationships with customers,
suppliers, consultants, employees and any other persons having business
relations with it (subject to Motient Services' ability to terminate
arrangements that are detrimental to the well-being of the Satellite
Communications Business), (iv) collect accounts receivable and pay expenses and
accounts payable in the ordinary course of business consistent with past
practice, and (v) maintain the Subject Assets in customary repair and condition,
provided, that if a non-ordinary course change in the business condition occurs
beyond the control of Motient Services (excluding, however, such changes which
any company controlling Motient Services causes or instructs Motient Services to
make), Motient Services shall not be deemed in breach of this Section 3.2.
(b) Prior to the Closing Date, Motient Services will maintain the Subject Assets
in accordance with Section 4.5.
(c) Prior to the Closing Date, Motient Services shall not take any of the
following actions without the consent of Newco, which consent shall not be
unreasonably withheld:
(i) enter into or amend any employment agreements
or arrangements, except in the ordinary course of business;
(ii) incur any indebtedness for borrowed money or
guaranty any such indebtedness of another person in excess of $2,000,000, except
in connection with (1) financing of up to $6,000,000 in the aggregate in
connection with satellite insurance policies and (2) equipment or vendor
financing of up to $5,000,000 in the aggregate (so long as such equipment or
vendor financing is obtained on commercially reasonable terms and such terms are
consistent with customary industry practice).
(iii) enter into any transactions with an Affiliate
of Motient Services, unless such transaction is either (i) in the ordinary
course of business consistent with Motient Services' past practice in dealing
with Affiliates as disclosed on Schedule 4.23, or (ii) negotiated at arms length
between the parties, on terms at least as favorable as those that could be
obtained by an independent third party, and is determined to be fair by the
board of directors of Motient Services;
(iv) acquiref orf agree to acquire, by merging or
consolidating with, by purchasing an equity interest in or a portion of the
assets of, or by any other manner, any business or corporation, partnership,
association or other business organization or division thereof;
(v) fail to maintain satellite and ground station
insurance coverage (to the extent available on commercially reasonable terms),
on its own or through Motient Corporation's policies, that is consistent with
past practice and reasonably consistent with the coverage of Motient
Corporation's other subsidiaries;
(vi) enter into any Agreements that require Motient
Services to repurchase products upon a transfer of such Agreement or upon a
change in control of the Satellite Communication Business;
(vii) hypothecate, mortgage, pledge, charge or
encumber, or permit any mortgage, pledge or encumbrance to exist on, any of its
Assets, except in connection with indebtedness permitted to be incurred under
Section 3.2(c)(ii) above; or
(viii) sell, lease, transfer or otherwise dispose
of, or purchase, lease or otherwise acquire, any Assets, except in the ordinary
course of business.
3.3. Disclosure
If, at any time prior to Closing, Motient Services becomes
aware of any information which would cause any condition set forth in Sections
7.1 or 7.2 not to be satisfied, Motient Services covenants that it will promptly
inform Newco thereof in writing.
3.4. News Releases
Neither party shall issue or approve any news release or other
public announcement (including, but not limited to, any public announcement to
clients and/or vendors) concerning the transactions contemplated by this Amended
Sale Agreement without the prior approval of the other party (which approval
shall not be unreasonably withheld), except as may be otherwise necessary or
appropriate for compliance with federal or state securities laws or applicable
requirements of any securities exchange, automated quotation system or
over-the-counter market (in which case, such disclosing party shall use
reasonable efforts to consult the other prior to such disclosure or filing).
3.5. General
Each of the parties hereto will use all commercially
reasonable efforts to take all action and to do all things necessary, proper, or
advisable in order to consummate and make effective the transactions
contemplated by this Amended Sale Agreement (including satisfaction, but not
waiver, of the conditions set forth in Sections 6 and 7). Notwithstanding the
foregoing, nothing contained herein shall require Motient Corporation, Motient
Holdings Inc. or any of their respective Affiliates to (i) enter into new
guaranties or incur new secondary liabilities of any kind to any customers or
vendors of the Satellite Communications Business, or (ii) except as expressly
set forth herein, make any payments or incur any liability to any third party in
connection with the assignment and transfer of the Contracts or any other
Agreement that is part of the Subject Assets to Newco.
3.6. Bulk Sales Laws.
Newco hereby waives compliance by Motient Services, in
connection with the transactions contemplated hereby, with the provisions of any
applicable bulk transfer laws; provided, however, that Motient Services shall
indemnify and hold harmless Newco from and against any losses attributable to
Motient Services' non-compliance with any applicable bulk transfer laws, without
regard to the provisions of Article 9.
3.7. Access to Information; Basic Financial Information
3.7.1. Access to Information.
Motient Services shall, upon the request of Newco, provide to
Newco and its representatives full access to all premises, properties, officers,
directors, consultants, contractors, books, records (including, without
limitation, tax returns, tax records and correspondence with accountants),
contracts and documents pertaining to the Satellite Communications Business as
Newco acting reasonably deems necessary (the "Business Review") and Newco and
its representatives shall have the right to copy such books, records, contracts
and documents at Newco's expense. Motient Services shall cooperate fully with
Newco and its representatives in permitting reasonable access to the Satellite
Communications Business to conduct the Business Review. Such access may be
either during normal business hours or after normal business hours after the
giving of reasonable advance notice to Motient Services. Newco shall reasonably
restore any property of Motient Services damaged as a result of the Business
Review to its condition prior to any such Business Review and shall indemnify
and defend Motient Services from any and all liability which may arise as a
result of the performance of the Business Review by Newco. Motient Services will
furnish to Newco and its representatives such financial and operating data and
other information with respect to the Satellite Communications Business as Newco
may reasonably request, including, without limitation, financial statements,
books and records and Agreements with clients, customers, vendors, lessors,
licensors and suppliers of the Satellite Communications Business. Newco hereby
agrees to hold in confidence and trust and not to disclose or misuse any
confidential information provided to it pursuant to this Section 3.7.1 and to
instruct any parties to whom it may transmit such information as provided below
of the confidential nature of such information; provided, however, that the
foregoing shall not prohibit Newco from disclosing such information (i) to its
board of directors, investment advisers, attorneys, accountants, consultants and
other professionals to the extent necessary to obtain their services in
connection with the transactions contemplated hereby, (ii) to Newco's
stockholders and Affiliates, or (iii) as required by applicable law or
regulation, regulatory body, stock exchange, court or administrative order, or
any listing agreement concerning Newco or Motient Services.
3.7.2. Basic Financial Information.
Until the Closing Date, Motient Services hereby covenants and
agrees to furnish the following reports to Newco:
(a) Within 105 days after the end of each fiscal year of
Motient Services, a consolidated balance sheet of Motient Services and its
subsidiaries, if any, as of the end of such fiscal year, which balance sheet
shall be prepared consistently with the Financial Statement (unless otherwise
indicated therein).
(b) Within 75 days after the end of each quarterly accounting
period in each fiscal year of Motient Services, (i) a consolidated balance sheet
of Motient Services and its subsidiaries, if any, as of the end of each such
quarterly period, which balance sheet shall be prepared consistently with the
Financial Statement (unless otherwise indicated therein), and (ii) a pro forma
presentation of the operating results of Motient Services for such quarterly
period based upon reasonable assumptions to be agreed upon by Motient Services
and Newco.
(c) Within 45 days after the end of each month, such monthly
operating data and other financial information in form and substance as the
parties agree is reasonable; provided that no such information shall be required
to be prepared in accordance with generally accepted accounting principles.
(d) Along with the statements required to be delivered to
Newco in connection with Sections 3.7.2(a) and (b), management's discussion of
any material changes in any such statement compared to the previously delivered
statement.
(e) As soon as practicable following their release, copies of
all material press releases issued by Motient Services or its Affiliates related
to the Satellite Communications Business or other material reports or
communications delivered by Motient Services or its Affiliates to the financial
community with respect to the Satellite Communications Business.
Any balance sheet, report or other information delivered by Motient Services to
Newco pursuant to this Section 3.7.2 shall be deemed to satisfy the obligations
of Motient Services under this Section 3.7.2 so long as such balance sheet,
report or other information was prepared in good faith.
3.8. Covenant to Perform Certain Obligations.
(a) Newco hereby covenants and agrees from and after the
Closing to (i) perform all of the obligations of Motient Services under the
Aether Satellite Network Agreement, (ii) use all commercially reasonable efforts
to satisfy the reasonable expectations of Aether in the performance of its
obligations under the Aether Satellite Network Agreement, (iii) use all
commercially reasonable efforts to resolve any and all disputes under the Aether
Satellite Network Agreement with Aether by providing Aether with service credits
or other customary additional non-cash benefits, (iv) as long as Newco has
satellite capacity, and Motient has not received its $8.8 million payment (or
would be liable for return of a portion thereof), service to Aether will not be
terminated without Motient's consent, (v) not alter, amend or renegotiate the
terms of the Aether Satellite Network Agreement to, or otherwise take any action
in connection with such agreement that would, adversely effect the timing or
amounts of any payments to Motient Services pursuant to the Aether Satellite
Network Agreement, including altering or amending the pricing terms thereof.
Provided that Newco shall have fully complied with this Section 3.8(a), then
Newco shall not be liable for any cash payments due and owing to Aether under
the Aether Satellite Network Agreement and Motient Services shall be liable for
such cash payments.
(b) Newco hereby covenants and agrees from and after the
Closing to perform all of the obligations of Motient Services under the Aether
IP License to the extent that such obligations relate to the Intellectual
Property that is being transferred to Newco pursuant to this Amended Sale
Agreement. To the extent that Aether has any Claim under the Aether IP License
with respect to the Intellectual Property transferred to Newco pursuant to this
Amended Sale Agreement, then (i) if such Claim is also maintained by one or more
of Newco's other customers, Newco will be liable for any such Claim for all
affected customers (including Aether), except if there is any additional
liability in connection with a Claim that is unique to Aether, then Motient
Services will be liable for such additional liability actually incurred, or (ii)
if such Claim is maintained only by Aether, then Motient Services will be liable
for all of the liability actually incurred in connection with such Claim.
(c) Newco agrees that from and after the Closing, in the event
that it takes any action that causes a breach under Section 4.4(a) of the Aether
Sale Agreement, Newco shall indemnify and hold harmless Motient Services and its
Affiliates for any claims made by Aether under such Section 4.4(a).
3.9. Update of Disclosure Schedules.
At Closing, Motient Services shall deliver to Newco an updated
version of the Disclosure Schedule which version shall supplement and update the
information in the Disclosure Schedule delivered herewith by adding relevant
information as to any pertinent developments or changes since the date hereof.
3.10. Insurance.
In the event Newco reasonably concludes that a claim can be
pursued under any of the insurance policies relating to the Subject Assets, the
Assumed Liabilities or the Satellite Communications Business for losses incurred
in connection with events occurring prior to Closing, Motient Services shall
pursue such claim on behalf of and for the benefit of Newco and take such
further actions as Newco may reasonably request to obtain recovery for Newco
under such claim.
4. REPRESENTATIONS AND WARRANTIES OF MOTIENT SERVICES
Except as set forth in the Disclosure Schedule (as updated
pursuant to Section 3.9 hereof), Motient Services hereby represents and warrants
to Newco, as of the date hereof and as of the Closing Date, as follows:
4.1. Organization and Standing
Motient Services is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware, and has
the full and unrestricted corporate power and authority to own, operate and
lease its Assets, to carry on its business as currently conducted, to execute
and deliver this Amended Sale Agreement and to carry out the transactions
contemplated hereby. Motient Services is qualified to transact business as a
foreign corporation in, and is in good standing under the laws of, the
jurisdictions listed on Schedule 4.1 to the Disclosure Schedule.
4.2. Subsidiaries
Motient Services has no subsidiaries and no equity investment
or other interest in any corporation, association, partnership, limited
liability company, joint venture or other entity, except as set forth on
Schedule 4.2 to the Disclosure Schedule. Motient Services has made no advances
or loans to any corporation, association, partnership, limited liability
company, joint venture or other entity or individual, except as set forth on
Schedule 4.2 to the Disclosure Schedule. Motient Services Inc. of Virginia is a
wholly-owned subsidiary of Motient Services with no assets, liabilities or
commitments other than as described on Schedule 4.2 of the Disclosure Schedule.
4.3. Noncontravention
Except as disclosed on Schedule 4.3 to the Disclosure
Schedule, neither the execution and the delivery of this Amended Sale Agreement,
nor the consummation of the transactions contemplated hereby, will, (A) violate
any constitution, statute, regulation, rule, injunction, judgment, order,
decree, ruling, charge, or other restriction of any government, governmental
agency, or court to which Motient Services is subject which could reasonably be
expected to have a Material Adverse Effect or, (B) conflict with, result in a
breach of, constitute a default (or an event which, with notice or lapse of
time, or both, would constitute a default) under, result in the acceleration of,
create in any party the right to accelerate, terminate, modify, or cancel, or
require any notice under any agreement, contract, lease, license, instrument,
note, bond, mortgage, deed of trust, or other arrangement existing to which
Motient Services is a party or by which any of its Assets is subject which would
reasonably be expected to have a Material Adverse Effect, (c) result in the
creation or imposition of any Encumbrance upon any of the Subject Assets which
could reasonably be expected to have a Material Adverse Effect, or (d) violate
Motient Services' organizational documents.
4.4. Real Property
Motient Services does not own and has never owned any real
property.
4.5. Assets
Motient Services has good, valid and marketable title to the
Subject Assets owned by it, free and clear of all Encumbrances (other than
Encumbrances set forth on Schedule 4.5) except where the failure to have such
title or to be free and clear of such Encumbrances would not reasonably be
expected to have a Material Adverse Effect.
4.6. Insurance
Schedule 4.6 to the Disclosure Schedule lists all policies of
title, asset, fire, hazard, casualty, liability, life, worker's compensation and
other forms of insurance of any kind owned or held by Motient Services and such
insurance coverage is reasonably consistent with industry standards. Motient
Services is in compliance in all material respects with its obligations to pay
premiums under all such insurance policies. Motient Services has not received
notice from, and has no knowledge of any threat by, any insurer (that has issued
any insurance policy to Motient Services) that such insurer intends to deny
coverage under or cancel, discontinue or not renew any insurance policy covering
Motient Services presently in force.
4.7. Intellectual Property
Schedule 4.7 to the Disclosure Schedule lists all franchises,
licenses, trademarks, service marks, trade names, copyrights, patents and
applications therefor used, owned or licensed by or registered in the name of
Motient Services or used in the Satellite Communications Business. Motient
Services owns all of the Intellectual Property listed on Schedule 4.7 to the
Disclosure Schedule except as otherwise indicated on Schedule 4.7 to the
Disclosure Schedule, pays no royalty to anyone with respect to any Intellectual
Property other than as described on Schedule 4.7 to the Disclosure Schedule and
has the right to bring action for the infringement of such Intellectual
Property, except where the failure so to own or to bring such action would not
reasonably be expected to result in a Material Adverse Effect. Motient Services
owns or possesses adequate rights to use all Intellectual Property necessary to
the conduct of the Satellite Communications Business except where failure to own
or possess such rights would not reasonably be expected to result in a Material
Adverse Effect. Motient Services has no knowledge, and has not received any
notice to the effect, that the Satellite Communications Business may or is
claimed to infringe any Intellectual Property or legally protectable right of
another.
4.8. Debt Instruments
Schedule 4.8 to the Disclosure Schedule lists all mortgages,
indentures, notes, guaranties and other Agreements for or relating to borrowed
money (including, without limitation, conditional sales agreements and capital
leases) to which Motient Services is a party, or which have been assumed by
Motient Services or to which the Subject Assets are subject. Motient Services
has performed all the obligations required to be performed by it to date and is
not in default in any respect under any of the foregoing, and there has not
occurred any event which (whether with or without notice, lapse of time or the
happening or occurrence of any other event) would constitute such a default.
4.9. Leases
Schedule 4.9 to the Disclosure Schedule lists all leases used
in the Satellite Communications Business under which Motient Services is lessee
or lessor of any asset (including, but not limited to, any lease which Motient
Services subleases to or from another party), or holds, manages or operates any
asset owned by any third party, or under which any asset owned by Motient
Services is held, operated or managed by a third party. Motient Services is the
owner and holder of all the leasehold estates purported to be granted to it by
the Documents described on Schedule 4.9 to the Disclosure Schedule and is the
owner or lessee of all equipment, machinery and other Assets thereon or in
buildings and structures thereon, in each case free and clear of all
Encumbrances (other than Encumbrances on a third-party landlord's fee or
leasehold ownership of leased or subleased property, Encumbrances in connection
with Personal Property subject to financing leases described on Schedule 4.9 and
Encumbrances described on Schedule 4.9). Each such lease and other Agreement is
in full force and effect and constitutes a legal, valid and binding obligation
of, and is legally enforceable against, Motient Services, and to the best of
Motient Services' knowledge, the respective third parties thereto and grants the
leasehold estate it purports to grant free and clear of all Encumbrances (other
than Encumbrances on a third-party landlord's fee or leasehold ownership of
leased or subleased property, Encumbrances in connection with Personal Property
subject to financing leases described on Schedule 4.9 and Encumbrances described
on Schedule 4.9). Motient Services has in all respects performed all obligations
thereunder required to be performed by it to date where the failure to so
perform would reasonably be expected to have a Material Adverse Effect. Neither
Motient Services nor, to the best of Motient Services' knowledge, any third
party is in default in any respect under any of the foregoing, and there has not
occurred any event which (whether with or without notice, lapse of time or the
happening or occurrence of any other event) would constitute such a default.
4.10. Material Agreements
Schedule 4.10 to the Disclosure Schedule lists all material
Agreements (other than those described in Section 4.9) of Motient Services or
any of its Affiliates connected to the operation of the Satellite Communications
Business (other than the Excluded Assets). Except as otherwise described on
Schedule 4.10 to the Disclosure Schedule, each such Agreement is in full force
and effect and constitutes a legal, valid and binding obligation of, and is
legally enforceable against, Motient Services and, to the best of Motient
Services' knowledge, the respective third parties thereto. Motient Services has
in all respects performed all the obligations thereunder required to be
performed by it, except where the failure to so perform would not reasonably be
expected to have a Material Adverse Effect. Neither Motient Services nor, to the
best of Motient Services' knowledge, any third party is in default in any
respect under any of the foregoing, and there has not occurred any event which
(whether with or without notice, lapse of time or the happening or occurrence of
any other event) would constitute such a default. Schedule 4.10 to the
Disclosure Schedule identifies all material Agreements (other than those
described in Section 4.9) used in the Satellite Communications Business to which
Motient Services is a party or by which Motient Services is bound that contains
provisions that are triggered upon a change of control of the Satellite
Communication Business. Schedule 4.10 to the Disclosure Schedule identifies all
material Agreements (including any pending proposals or bids for Agreements)
used in the Satellite Communication Business to which Motient Services is a
party or by which Motient Services is bound that obligates Motient Services to
provide services for which Motient Services has received prepayments from
customers, resellers, service providers and other consumers of Motient Services'
services.
4.11. Litigation; Disputes
(a) There are no actions, suits, Claims, arbitrations, proceedings or
investigations pending, threatened or reasonably anticipated against, affecting
or involving Motient Services, the Satellite Communications Business or the
Subject Assets, or the transactions contemplated by this Amended Sale Agreement,
at law or in equity or admiralty, or before or by any court, arbitrator or
governmental authority, domestic or foreign, other than as set forth on Schedule
4.11 to the Disclosure Schedule. None of such actions, suits, Claims,
arbitrations, proceedings or investigations set forth on Schedule 4.11 to the
Disclosure Schedule would, individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect. Motient Services is not operating
under, subject to or in default with respect to any order, award, writ,
injunction, decree or judgment of any court, arbitrator or governmental
authority.
(b) Except for matters governed by Section 4.25, Motient Services has complied
with all applicable Laws of federal, state, local, and foreign governments (and
all agencies thereof) with respect to the Satellite Communications Business and
has complied with all licenses, permits and authorizations with respect to the
Satellite Communications Business, except where Motient Services' failure to
comply would not be reasonably likely to have a Material Adverse Effect. Motient
Services has all federal, state, local and foreign governmental licenses,
permits, qualifications and authorizations ("Permits") materially necessary in
the conduct of the Satellite Communications Business as currently conducted. All
such Permits are in full force and effect, and no material violations have
occurred in respect of any such Permits; no material proceeding is pending or,
to the knowledge of Motient Services, threatened to revoke or limit any such
Permit; and no such Permit will be suspended, cancelled or adversely modified in
any material respect as a result of the execution and delivery of this Amended
Sale Agreement or the Ancillary Agreements and the consummation of the
transactions contemplated hereby or thereby.
4.12. Labor Relations; Employees
There are no strikes, work stoppages, grievance proceedings,
union organization efforts or other controversies pending, or, to the knowledge
of Motient Services, threatened or reasonably anticipated, with respect to the
Satellite Communications Business between Motient Services and (i) any current
or former employees of Motient Services or (ii) any union or other collective
bargaining unit representing such employees. Motient Services has complied and
is in compliance with all Laws relating to employment or the workplace,
including, without limitation, provisions relating to wages, hours, collective
bargaining, safety and health, work authorization, equal employment opportunity,
immigration, withholding, unemployment compensation, worker's compensation,
employee privacy and right to know, except where failure to comply with such
Laws would not, individually or in the aggregate, reasonably be expected to have
a Material Adverse Effect. There are no collective bargaining agreements,
employment agreements between Motient Services and any of its employees, or
professional service agreements not terminable at will with respect to the
Satellite Communications Business.
4.13. Taxes
(a) Motient Services has timely filed (or has had timely filed
on its behalf) all material Tax Returns required by applicable law to be filed
by it prior to the date hereof, and all such material Tax Returns were true,
correct and complete in all material respects.
(b) Motient Services has paid (or has had paid on its behalf)
all Taxes shown due with respect to Tax Returns filed prior to the date hereof.
(c) There are no material Encumbrances for Taxes on any assets
of Motient Services (other than for current Taxes not yet due and payable).
(d) Motient Services has complied in all material respects
with all applicable laws, rules and regulations relating to the payment and
withholding of Taxes.
(e) Motient Services is not a party to any tax allocation, tax
sharing, tax indemnity or similar agreement (whether or not in writing),
arrangement or practice with respect to Taxes (including any adverse pricing
agreement, closing agreement or other agreement relating to Taxes with any
authority), except with Motient Corporation.
(f) No federal, state, local or foreign audits or
administrative proceedings are presently ongoing with regard to any material
Taxes or Tax Returns of Motient Services and Motient Services has not received a
written notice of any proposed audit or proceeding regarding any pending audit
or proceeding.
4.14. Restrictions and Consents
Except as set forth on Schedule 4.14 to the Disclosure
Schedule, there are no Agreements, Laws or other restrictions of any kind to
which Motient Services (or any Subject Asset) is party or subject that would (a)
prevent or restrict the execution, delivery or performance of this Amended Sale
Agreement, or (b) result in any penalty, forfeiture, Agreement termination, or
restriction on business operations of Newco as a result of the execution,
delivery or performance of this Amended Sale Agreement, which would be
reasonably likely to have a Material Adverse Effect.
4.15. Authorization
The execution, delivery and performance by Motient Services of
this Amended Sale Agreement and all other Documents contemplated hereby, the
fulfillment of and compliance with the respective terms and provisions hereof
and thereof, and the consummation by Motient Services of the transactions
contemplated hereby and thereby, (a) have been duly authorized by all necessary
corporate action on the part of Motient Services, (b) except as set forth on
Schedule 4.15 to the Disclosure Schedule, do not and will not require any
consent or approval of Motient Services, any of its Affiliates or any third
party which has not already been obtained, (c) do not and will not conflict
with, or violate any provision of, any Law having applicability to Motient
Services or the Subject Assets, except for such conflicts or violations which
would not reasonably be expected to have a Material Adverse Effect, or any
provision of the certificate or articles of incorporation or bylaws of Motient
Services, (d) except as set forth on Schedule 4.15 to the Disclosure Schedule,
do not and will not conflict with, or result in any breach of, or constitute a
default under (i) the Indenture, dated as of March 31, 1998, among Motient
Holdings Inc., State Street Bank and Trust Company and the Guarantor named
therein (the "Indenture") with respect to the Series A and Series B 12 1/4%
Senior Notes Due 2008 (the "Senior Notes"), and (ii) any other Agreement to
which Motient Services is a party or by which it or any of the Subject Assets
may be bound which would be reasonably likely to have a Material Adverse Effect,
or (e) do not and will not result in or require the creation or imposition of or
result in the acceleration of any indebtedness, or of any Encumbrance of any
nature upon, or with respect to, Motient Services or any of the Subject Assets
now owned or hereafter acquired by Motient Services which would be reasonably
likely to have a Material Adverse Effect.
4.16. Absence of Violation
Motient Services has complied and is in full compliance with
all Laws applicable to the Satellite Communications Business, the Subject Assets
and the Assumed Liabilities except where failure to so comply would not be
reasonably likely to have a Material Adverse Effect.
4.17. Binding Obligation
This Amended Sale Agreement constitutes a legal, valid and
binding obligation of Motient Services, enforceable in accordance with its
terms; and each Document to be executed by Motient Services pursuant hereto,
when executed and delivered in accordance with the provisions hereof, shall be a
valid and binding obligation of Motient Services, enforceable in accordance with
its terms.
4.18. Financial Statement
Motient Services has previously furnished to Newco the
unaudited balance sheet of Motient Services dated as of September 30, 2000 (the
"Financial Statement"). The Financial Statement is in accordance with the books
and records of Motient Services and presents fairly the financial position of
Motient Services at September 30, 2000 in all material respects, subject to the
absence of footnotes and to normal and customary year-end adjustments.
4.19. Absence of Undisclosed Liabilities
Except as described in the Financial Statement, there are no
liabilities or obligations (whether absolute or contingent, matured or
unmatured, known or unknown) of Motient Services which would be required to be
disclosed on a financial statement prepared in accordance with generally
accepted accounting principles, except for those liabilities or obligations (i)
reflected or reserved against in the Financial Statement, (ii) that have been
incurred after September 30, 2000 in the ordinary course of business consistent
with past practice, or (iii) that are not reasonably likely to have a Material
Adverse Effect.
4.20. Material Adverse Change
Except as set forth in Section 4.20 of the Disclosure
Schedule, since December 31, 1999 there has been no change, circumstance or
event that could reasonably be expected to result in a Material Adverse Effect
or have a material adverse effect on the transactions contemplated by this
Amended Sale Agreement.
4.21. Assets Used in Satellite Communications Business
The Subject Assets constitute all of the Assets (other than
the Excluded Assets) used by Motient Services in the Satellite Communications
Business.
4.22. Licenses
Motient Services possesses all licenses issued by the FCC, and
all other licenses, permits, franchises and similar authorizations, that are
required for the operation of the Satellite Communications Business as presently
conducted and the ownership, operation, lease and holding by Motient Services of
the Subject Assets (the "Company Permits"). Motient Services is in compliance
with the terms of the Company Permits, and all such Company Permits are in full
force and effect.
4.23. Transactions with Affiliates
Except as set forth on Schedule 4.23 of the Disclosure
Schedule, there are no material Agreements or transactions with any Affiliate of
Motient Services.
4.24. Employee Benefit Plans
(a) Schedule 4.24 of the Disclosure Schedule contains a list
of all of the Benefit Plans Motient Services has delivered or made available to
Newco true and complete copies of each Benefit Plan (including any trust
agreement), the most recent summary plan description and all other material
employee communications with respect to each Benefit Plan.
(b) Each of the Benefit Plans listed in Schedule 4.24 hereto
is and has at all times been in compliance in all material respects with all
applicable provision of ERISA, the Code and other Laws.
(c) Except as specifically set forth in Schedule 4.24, the
execution and performance of the transactions contemplated by this Agreement
will not (either alone or upon the occurrence of any additional or subsequent
event) constitute an event under any Benefit Plan or individual agreement that
will or may result in any payment (whether of severance pay or otherwise),
acceleration, vesting or increase in benefits with respect to any employee,
former employee, consultant or agent of the Satellite Communications Business.
(d) At no time has Motient Services or any of its affiliates
contributed to, been required to contribute to, or incurred any withdrawal
liability (within the meaning of Section 4201 of ERISA) to any Benefit Plan
which is a multiemployer plan as defined in Section 3(37) of ERISA or which is a
defined benefit plan subject to Title IV of ERISA.
(e) To the knowledge of Motient Services, no event has
occurred, or is threatened which would constitute a reportable event (for which
the notice requirement has not been waived) within the meaning of Section
4043(b) of ERISA with respect to any Benefit Plan which is an "employee pension
benefit plan" as defined in Section 3(2) of ERISA.
(f) Each of the Benefit Plans which are intended to meet the
requirements of Section 401(a) of the Code has received a favorable
determination letter from the Internal Revenue Service and to Motient Services'
knowledge, nothing has occurred to jeopardize such qualification.
(g) Motient Services and its affiliates have made all
contributions required to be made to each Benefit Plan under the terms of the
plan and applicable law. To Motient Services' knowledge, no prohibited
transaction (as defined in Section 4975 of the Code or Section 406 of ERISA) has
occurred with respect to any Benefit Plan.
4.25. Environmental Matters
Except as set forth on Schedule 4.25 of the Disclosure
Schedule, there are, with respect to Motient Services, no past or present
violations of Environmental Law (as defined below), nor any actions, activities,
circumstances, conditions, events, incidents, or contractual obligations which
are reasonably likely to give rise to any liability which would have a Material
Adverse Effect pursuant to any Environmental Law, and Motient Services has not
received any written notice with respect to any of the foregoing nor is any
Litigation pending or, to the knowledge of Motient Services, threatened in
connection with any of the foregoing.
For purposes of this Section 4.25, capitalized terms
used herein shall have the following meanings:
"Environmental Laws" shall mean all applicable
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provisions of federal, state, local orforeign law (including applicable
principles of common and civil law), statutes, ordinances, rules, regulations,
published standards and directives that have the force and effect of law,
permits, licenses, judgments, writs, injunctions, decrees and orders enacted,
promulgated or issued by any Public Authority, and all indemnity agreements and
other contractual obligations, as in effect at such date, relating to (i) the
protection of the environment, including the air, surface and subsurface soils,
surface waters, groundwaters and natural resources, and (ii) occupational health
and safety and exposure of persons to Hazardous Materials. Environmental Laws
shall include the Comprehensive Environmental Response, Compensation and
Liability Act, 42 U.S.C. ss.ss. 9601 et seq., and any other laws imposing or
creating liability with respect to Hazardous Materials.
"Hazardous Material" shall mean any substance
--------------------
regulated by any Environmental Law.
"Public Authority" shall mean any supranational,
----------------
national, regional, state or localgovernment court, governmental agency,
authority, board, bureau, instrumentality or regulatory body.
5. REPRESENTATIONS AND WARRANTIES OF NEWCO
Newco hereby represents and warrants to Motient Services as
follows:
5.1. Organization and Standing
Newco is a limited liability company duly organized, validly
existing and in good standing under the laws of the State of Delaware, and has
the full and unrestricted limited liability company power and authority to own,
operate and lease its Assets, to carry on its business as currently conducted,
to execute and deliver this Amended Sale Agreement and to carry out the
transactions contemplated hereby, except where the failure to have such limited
liability company power and authority would not reasonably be expected to have a
material adverse effect on the business operations, financial condition, assets
or liabilities of Newco (a "Newco Material Adverse Effect"). At Closing, Newco
will have converted into a Delaware limited partnership pursuant to the laws of
the State of Delaware.
5.2. Authorization
The execution, delivery and performance by Newco of this
Amended Sale Agreement and all other Documents contemplated hereby, the
fulfillment of and compliance with the respective terms and provisions hereof
and thereof, and the consummation by Newco of the transactions contemplated
hereby and thereby, (a) have been duly authorized by all necessary action on the
part of Newco, (b) do not and will not conflict with, or violate any provision
of, any Law having applicability to Newco or any of its Assets, except for such
conflicts or violations which would not, individually or in the aggregate,
reasonably be expected to have a material adverse effect on the ability of the
parties to this Amended Sale Agreement to close the transactions contemplated
hereby, or any provision of the certificate of formation or operating agreement
of Newco, (c) do not and will not conflict with, or result in any breach of, or
constitute a default under any material Agreement to which Newco is a party or
by which it or any of its assets may be bound which would be reasonably likely
to have a Newco Material Adverse Effect, or (d) do not and will not result in or
require the creation or imposition of or result in the acceleration of any
indebtedness, or of any material Encumbrance upon, or with respect to, Newco or
any of the assets now owned or hereafter acquired by Newco which would be
reasonably likely to have a Newco Material Adverse Effect.
5.3. Binding Obligation
This Amended Sale Agreement constitutes a valid and binding
obligation of Newco, enforceable in accordance with its terms. Each Document to
be executed by Newco pursuant hereto, when executed and delivered in accordance
with the provisions hereof, shall be a valid and binding obligation of Newco,
enforceable in accordance with its terms.
6. CONDITIONS PRECEDENT TO OBLIGATIONS OF MOTIENT SERVICES
The obligations of Motient Services to effect the Closing are
subject to the fulfillment, at or prior to the Closing, of each of the following
conditions, and failure to satisfy any such condition shall excuse and discharge
all obligations of Motient Services to effect the Closing, unless such failure
was caused by, or is waived in writing by, Motient Services:
6.1. Performance
Newco shall have performed and complied in all material
respects with all Agreements and conditions required by this Amended Sale
Agreement to be performed or complied with by Newco on or prior to the Closing
Date.
6.2. Legal Proceedings
No action or proceeding by or before any governmental
authority shall have been instituted (and not subsequently dismissed, settled or
otherwise terminated) which is reasonably expected to restrain, prohibit or
invalidate the transactions contemplated by this Amended Sale Agreement, other
than any action or proceeding instituted by or on behalf of Motient Services or
any of its Affiliates.
6.3. Newco's Certificate
Newco shall have delivered to Motient Services a certificate,
dated as of the Closing Date and executed by a senior officer of Newco,
certifying to the fulfillment of the conditions set forth in Sections 6.1 and
6.2.
6.4. Contemporaneous Closing
The closing of the transactions contemplated by each of the
Investment Agreement, the Asset Sale Agreement dated as of the date hereof
between Newco and TMI Communications and Company Limited Partnership ("TMI")
(the "Newco-TMI Sale Agreement"), the Asset Sale Agreement dated as of the date
hereof between TMI and Canadian License Co. (the "Canadian Asset Sale
Agreement") and the Asset Sale Agreement between TMI and MSV Nova Scotia ULC
(the "TMI-ULC Asset Sale Agreement") shall occur prior to, or simultaneously
with, the Closing under this Agreement.
7. CONDITIONS PRECEDENT TO OBLIGATIONS OF NEWCO
The obligations of Newco to effect the Closing are subject to
the fulfillment, at or prior to the Closing, of each of the following
conditions, and failure to satisfy any such condition shall excuse and discharge
all obligations of Newco to effect the Closing, unless such failure was caused
by, or is agreed to in writing, by Newco:
7.1. Performance
Motient Services shall have performed and complied in all
material respects with all Agreements and conditions required by this Amended
Sale Agreement to be performed or complied with by Motient Services on or prior
to the Closing Date.
7.2. Legal Proceedings
No action or proceeding by or before any governmental
authority shall have been instituted (and not subsequently settled, dismissed or
otherwise terminated) which is reasonably expected to restrain, prohibit or
invalidate the transactions contemplated by this Amended Sale Agreement other
than an action or proceeding instituted by Newco.
7.3. Officer's Certificate
Motient Services shall have delivered to Newco a certificate,
dated as of the Closing Date and executed by a senior officer of Motient
Services, certifying to the fulfillment of the conditions specified in Sections
7.1 and 7.2.
7.4. Contemporaneous Closing
The closing of the transactions contemplated by each of the
Investment Agreement, the Newco-TMI Sale Agreement, the Canadian Asset Sale
Agreement, and the TMI-ULC Asset Sale Agreement shall occur prior to, or
simultaneously with, the Closing under this Agreement.
8. Closing
8.1. Deliveries by Motient Services
At the Closing, Motient Services shall deliver to Newco the
following:
(a) a certified copy of the resolutions adopted by the Board of Directors of
Motient Services on or prior to the date hereof authorizing the Closing;
(b) certificates of incumbency and specimen signatures of the signatory officers
of Motient Services;
(c) the certificate required pursuant to Section 7.3 hereof;
(d) a bill of sale and limited assignment and assumption agreement substantially
in the form attached as Exhibit C, and such other instruments of transfer as
Newco shall reasonably require to transfer to Newco title to the Subject Assets
free and clear of all Claims and Encumbrances other than the Assumed Liabilities
and to cause Newco to assume the Assumed Liabilities (the "Transfer
Instruments"); and
(e) such other Documents as Newco may reasonably request.
8.2. Deliveries by Newco
At the Closing, Newco shall deliver the following:
(a) a wire transfer of the balance of the Purchase Price payable in accordance
with Section 2.2;
(b) the Note duly executed by Newco and payable to Motient Services;
(c) a certified copy of the resolutions adopted by the Board of Directors of
Newco authorizing the Closing;
(d) the certificate required by Section 6.3;
(e) the Transfer Instruments (to the extent required to be executed by Newco);
and
(f) such other Documents as Motient Services may reasonably request.
8.3. Transferred Employees
(a) As used in this Agreement, "Transferred Employees" means the employees of
the Satellite Communications Business which shall be identified on an "Employee
Schedule" to be delivered by Motient Services to Newco prior to the Closing
Date.
(b) Newco shall offer employment to all the Transferred Employees effective as
of the day following the Closing Date at the same salary or hourly wage set
forth in the Employee Schedule, subject to Newco's right to terminate any such
Transferred Employee, in accordance with applicable Laws, at any time with or
without cause, for any reason or no reason at all.
(c) Subject to Section 8.3(b), during the period commencing as of the Closing
Date and ending on the first (1st) anniversary thereof, Newco shall cause the
Transferred Employees who accept such employment offer (the "Accepting
Employees") to be provided with compensation and employee benefit plans
(excluding stock option plans involving the potential issuance of securities of
Motient Corporation) which in the aggregate are not materially less favorable
than those provided to such employees by Motient Services and its Affiliates
immediately prior to the Closing Date, to the extent permitted under applicable
Laws. The provisions of this Section 8.3 shall not create in any Transferred
Employee or any other current or former employee of Motient Services or any of
its Affiliates any rights to employment or continued employment with Newco,
Motient Services or any of their respective Affiliates or any right to specific
terms or conditions of employment. Promptly following the Closing Date, Motient
Services shall transfer to Newco all personnel files pertaining to the Accepting
Employees.
(d) Newco shall provide each Accepting Employee full credit for such Accepting
Employee's service with Motient Services or its Affiliates or predecessors for
purposes of eligibility, vesting and benefit accrual (except for benefit
accruals under any defined benefit pension plan) under the employee benefit
plans or arrangements of Newco in which such Accepting Employees participate for
such Accepting Employee's service with Motient Services or its Affiliates, to
the same extent recognized under similar plans or arrangements of Motient
Services or its Affiliates immediately prior to the Closing.
(e) Newco shall (i) waive all limitations as to preexisting conditions,
exclusions and waiting periods with respect to participation and coverage
requirements applicable to any Accepting Employee under any welfare benefit
plans in which such Accepting Employees may be eligible to participate after the
Closing, other than limitations or waiting periods that are already in effect
with respect to such Accepting Employee and that have not been satisfied as of
the Closing under any welfare plan maintained for such Accepting Employee
immediately prior to the Closing, and (ii) provide each Accepting Employee with
credit for any co-payments and deductibles paid prior to the Closing under
welfare plans of Motient Services or any of its Affiliates for the plan year in
which the Closing occurs in satisfying any applicable deductible or
out-of-pocket requirements under any welfare plans that such Accepted Employee
is eligible to participate in after the Closing.
(f) Following the Closing, Newco shall honor and maintain all vacation and other
leave earned or accrued by, but not taken by or paid to, Accepting Employees
through the Closing (as calculated or determined under policies or plans in
effect immediately prior to the Closing). The preceding sentence to the contrary
notwithstanding, nothing set forth herein shall impair or otherwise affect the
rights of Newco or its Affiliates to amend, suspend or terminate any such
agreement, policy or plan in accordance with its terms as in effect from time to
time.
(g) Each of Motient Services and Newco shall provide any notifications to its
respective employees (including, in the case of Newco, the Accepting Employees
and, in the case of Motient Services, Transferred Employees who do not become
Accepting Employees) required under the Workers Adjustment and Retraining
Notification Act (the "WARN Act") and shall bear any liabilities arising under
the WARN Act with respect to such employees.
(h) With respect to each Accepting Employee, Newco hereby agrees to give Motient
Services notice of the termination of such Accepting Employee's employment with
Newco within 30 days of the date thereof, and provide Motient Services with such
information with respect thereto as Motient Services shall reasonably request to
enable it to determine if such event would give rise to a right of distribution
to such Accepting Employee under Motient Services' 401(k) plan.
8.4. Transitional and Ongoing Matters
(a) Motient Services and Newco hereby agree to use all
commercially reasonable efforts to obtain the Landlord's consent to the transfer
of Motient Services' rights and obligations under the Lease to Newco on the
Closing Date. Newco and Motient Services shall work together and cooperate in
good faith to develop a mutually agreeable plan that takes into account the
reasonable business needs of the other for the sharing of the Reston Facility by
Newco and Motient Services and its Affiliates until the expiration of the term
of the Lease (including any extensions thereof). To the extent there is excess
space at the Reston Facility beyond the needs of Newco and Motient Services,
Newco and Motient Services shall share equally the costs and the benefits, if
any, of such excess space. Newco and Motient Services shall negotiate in good
faith the terms of a sublease or other arrangement to provide Motient Services
and its Affiliates with the right to use and occupy the Reston Facility
consistent with such mutually agreeable plan. In the event that Motient Services
is unable to transfer or otherwise assign its rights and obligations under the
Lease to Newco, Newco and Motient Services shall negotiate in good faith the
terms of a sublease or other arrangement to provide Newco with the right to use
and occupy the Reston Facility consistent with such mutually agreeable plan. The
parties agree that in either case the rent and other actual out-of-pocket costs
associated with the Lease shall be shared pro rata based on the parties' actual
usage of the Reston Facility measured in square feet.
(b) The obligation of Newco to provide space to Motient and
its Affiliates pursuant to paragraph (a) shall be in addition to the obligations
of Newco to provide space in the Reston Facility to Aether under the LES
Agreement.
8.5. Shared Assets; Parent Guaranties
(a) The parties acknowledge that as of the date hereof (and as of the Closing
Date) there are certain Assets and Agreements of Motient Corporation and its
Subsidiaries, which are listed on Schedule 8.5 to the Disclosure Schedule, that
are used by Motient Services in connection with its Satellite Communications
Business that will not be part of the Subject Assets, but will remain with
Motient Corporation and its Subsidiaries (the "Shared Assets"). The parties
agree to cooperate in good faith to develop a plan so that such Shared Assets
can reasonably be divided or, if such a division is not possible, shared in a
way so that such Shared Assets can reasonably be used by both for a period of
time reasonably acceptable to both parties: (i) Newco in connection with the
Satellite Communications Business, and (ii) Motient Corporation and its
subsidiaries in connection with their respective businesses (excluding the
Satellite Communications Business). Without limiting the generality of the
foregoing, beginning on the Closing Date, Motient Services shall provide Newco
with access to, and use of (A) the telephones, facsimile machines and computers
at the Reston Facility then used by the Accepting Employees for their intended
and usual purpose in connection with the operation of the Satellite
Communications Business for a period of time reasonably acceptable to both
parties and (B) Motient Services' computer network and programs for accounting
applications. Motient Services and Newco shall negotiate in good faith to
equitably apportion the costs and liabilities associated with the shared use or
division, as the case may be, of such Assets or Agreements, and, if appropriate,
enter into transition services agreement which shall provide for the foregoing
and such other transition services as the parties shall in good faith agree.
(b) The parties agree to use all commercially reasonable efforts (but without
any obligation to expend funds) so that the guaranties made by Motient
Corporation and its Affiliates for the benefit of Motient Services relating to
the Subject Assets and the Assumed Liabilities (the "Parent Guaranties") will be
terminated or otherwise released on or prior to the Closing, or if not possible,
as soon as practicable thereafter. In the event that the Parent Guaranties are
not terminated by the Closing, Newco shall indemnify, defend and hold harmless
Motient Services from and against all Losses of Motient Services and its
Affiliates which (i) arise under any unreleased Parent Guaranty, (ii) relate to
any Assumed Liability, and (iii) arise out of the ownership or operation of the
Satellite Communication Business following the Closing; without regard to the
provisions of Article 9.
8.6. Motient Resale of Newco Products and Services
Following the Closing, to the extent the ordinary course of
business of Newco includes marketing its products or services through resellers,
Newco shall, at the request of Motient Corporation or any of its wholly-owned
subsidiaries (including Motient Communications, Inc.), offer to enter into a
Newco Standard Reseller Arrangement with such requesting party, on terms that
are, on the whole, at least as favorable as the terms Newco then offers under
any Newco Standard Reseller Arrangement to any reseller that has purchased or
committed to purchase a similar volume of products or services from Newco,
provided that this Section 8.6 shall not require Newco to offer products or
services to such requesting party that it does not offer for resale or to enter
into any arrangement if Newco determines in good faith that such arrangement
would prevent or significantly hinder its ability to capitalize upon a material
business opportunity. As used herein, the term "Newco Standard Reseller
Arrangement" shall mean an agreement in the form used by Newco in the ordinary
course of its business with third parties whose only material business
relationship with Newco involves reselling Newco products or services in the
ordinary course of business. Unless otherwise agreed by Newco, the Newco
Standard Reseller Arrangement offered by Newco pursuant hereto shall not be
required to have a term that extends beyond the third anniversary of the
Closing.
8.7. Use of Proceeds
Motient Services covenants and agrees to use and apply the
Purchase Price consistent with any restrictions set forth in any loan documents,
bank agreements, indenture or similar documents applicable to Motient Services
or its Affiliates.
8.8. Insurance Proceeds from Satellite Failure
(a) In the event that prior to Closing, an event occurs
causing the full or partial failure of the Satellite (a "Satellite Casualty
Event"), the parties hereto shall proceed on the same terms and conditions as
otherwise provided in this Amended Sale Agreement (including with respect to the
Purchase Price) except that the insurance proceeds relating to the Satellite
Casualty Event (the "Insurance Proceeds"), if any, shall be deemed to be part of
the Subject Assets and in the event of a total failure where Motient Services no
longer owns the Satellite, the Satellite shall not be part of the Subject
Assets. Motient Services shall send written notice to Newco within ten (10)
business days describing the Satellite Casualty Event in reasonable detail,
including information as to whether the Satellite Casualty Event is or may be
covered by insurance. In addition, Motient Services shall notify Newco as soon
as reasonably practicable after it and the insurance carrier finally resolve the
amount of the Insurance Proceeds.
(b) So long as Motient Services complies with clause (a) of
this Section 8.8, Motient Corporation and its direct and indirect subsidiaries
(including Motient Services) shall have no further liability with respect to the
failure of the Satellite under this Amended Sale Agreement, the R&D Agreement or
any other Agreement, and Newco shall be deemed to have waived its rights, if
any, with respect to any indemnity or other remedy from Motient Services related
to the failure of the Satellite.
8.9. Loss of FCC Licenses
In the event that prior to Closing, any of the Licenses in
effect with the FCC lapse, terminate or are not renewed so that it is
commercially unreasonable to continue the business of Motient Services as
currently conducted, then Motient Services shall send written notice to Newco no
later than ten (10) business days following the date Motient Services becomes
aware of any such lapse, termination or non-renewal. Newco at its option can
elect to (i) proceed on the same terms and conditions as otherwise provided in
this Amended Sale Agreement (including with respect to the Purchase Price)
except that any such license that lapses, terminates or is not renewed shall not
be deemed part of the Licenses (and therefore, not part of the Subject Assets),
or (ii) terminate this Amended Sale Agreement and receive an irrevocable refund
of an amount equal to the Refund, in which case, Motient Services shall be
obligated to pay such amount to Newco within sixty (60) days of Newco's
election. So long as Motient Services complies with this Section 8.9 and Section
3.2(a)(i), including refunding any amount due to Newco under clause (ii) of this
Section 8.9, Motient Corporation and its direct and indirect subsidiaries
(including Motient Services) shall have no further liability with respect to any
such Licenses under this Amended Sale Agreement, the R&D Agreement or any other
Agreement and Newco shall have be deemed to have waived its rights, if any, with
respect to any indemnity or other remedy from Motient Services related to such
lapse, termination or non-renewal of any of such Licenses.
8.10. Reduction in the Refund Amount
To the extent that any one or more Investors (as defined in
the Investment Agreement) has effected or exercised its right to effect (which
election has not been revoked) a Parent Conversion (as defined in the Investment
Agreement) at the time the Refund is to be irrevocably paid, the $44 million
required to be paid by Motient Services to Newco as a refund of the Initial
Payment and the R&D Fee pursuant to Section 8.9 hereof shall be reduced by an
amount equal to $44 million multiplied by the result of (a) the total Investor
Interests (as defined in the Investment Agreement) of such Investor which have
effected Parent Conversions immediately prior to such Parent Conversions,
divided by (b) the total Investor Interests of all the Investors immediately
prior to such Parent Conversions. (By way of illustration only, if one Investor
had effected a Parent Conversion and owned a 6.67% Investor Interest immediately
prior to the Parent Conversion, the refund of the Initial Payment and the R&D
Fee due to Newco would be reduced by $14.67 million (which number is $44 million
multiplied by .3335 (6.67/20 = .3335)).
9. SURVIVAL OF REPRESENTATIONS; INDEMNIFICATION; REMEDIES
9.1. Survival of Representations
All representations and warranties made by in or pursuant to
this Amended Sale Agreement and in or pursuant to the Ancillary Agreements shall
survive the Closing until two years after the date made (except to the extent
that the representations and warranties set forth in Sections 4.3 and 4.15 apply
to the Indenture, such representations and warranties shall survive until the
expiration of the statute of limitations applicable to any claims made by the
holders of the Senior Notes), and shall in no way be affected by any
investigation or knowledge of the subject matter thereof made by or on behalf of
Newco. If the Closing shall occur, indemnification pursuant to this Article 9
shall be the exclusive remedy for any breach of representations and warranties
or of any covenant or Agreement in this Amended Sale Agreement which survives
the Closing by either party or any other matter pertaining to this Amended Sale
Agreement (except as specifically provided otherwise herein) or the transactions
contemplated hereby, other than Claims relating to other written Agreements
between the parties and Claims relating to fraud or violation of securities
laws; provided that nothing in Article 9 shall prevent any party from obtaining
equitable relief in order to require the other party to perform its obligations
hereunder.
9.2. Agreement of Motient Services to Indemnify
From and after the Closing, Motient Services shall indemnify
and hold harmless Newco from and against all damages, losses, claims,
liabilities and obligations, costs and expenses (including reasonable attorneys'
fees) ("Losses") arising in any way out of or related to (i) the breach by
Motient Services of any representation or warranty made by Motient Services in
this Amended Sale Agreement or any Ancillary Agreement or in any document
delivered pursuant hereto or thereto, (ii) the breach by Motient Services of any
covenant or agreement contained herein or any Ancillary Agreement or in any
document delivered pursuant hereto or thereto, or (iii) liabilities of Motient
Services or its Affiliates which are not Assumed Liabilities. For purposes of
this Section 9.2, the terms "material" and "Material Adverse Effect", and other
materiality qualifiers in the representations and warranties contained herein or
in the Ancillary Agreements and in any documents delivered pursuant hereto or
thereto, shall be deemed to refer to matters, and groups of related matters,
that have a financial or economic impact, or are capable of having a financial
or economic impact, of $100,000 or more. For purposes of the foregoing sentence,
matters shall be considered to be within a "group of related matters" if they
relate to any given Section of the representations and warranties. (For purposes
of illustration only, Section 4.19 would be deemed to be breached if Motient
Services had failed to disclose a liability of $25,000 and a liability of
$90,000, but not if Motient Services had failed to disclose seven liabilities of
$10,000 each.).
9.3. 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.
9.4. Agreement of Newco to Indemnify
From and after the Closing, Newco shall indemnify and hold
harmless Motient Services from and against all Losses arising in any way out of
or related to (i) the breach by Newco of any representation or warranty made by
Newco in this Amended Sale Agreement or any Ancillary Agreement or in any
document delivered pursuant hereto or thereto, (ii) the breach by Newco of any
covenant or agreement contained herein or any Ancillary Agreement or in any
document delivered pursuant hereto or thereto, or (iii) the Assumed Liabilities.
9.5. Notice of Claims.
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 promptly deliver 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 9) 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.
9.6. Limitations on Amounts
The Indemnifying Party shall not be obligated to pay any
amounts for indemnification for breaches of representations and warranties under
this Article 9 until the aggregate indemnification obligation of such
Indemnifying Party hereunder for such breaches (and under the R&D Agreement)
exceeds $500,000, 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 Purchase Price (to the extent actually
paid) plus the R&D Fee (the "Cap"), except in the case of (i) a fraud or willful
breach by Motient Services, (ii) a breach by Motient Services of the
representations and warranties contained in Sections 4.3 or 4.15 hereof with
respect to the Indenture, (iv) liabilities of Motient Services or its Affiliates
that are not Assumed Liabilities. For purposes of calculating the Cap, all
amounts received by Newco for Losses under the R&D Agreement and any Agreements
delivered pursuant hereto shall be included in calculating the Cap.
9.7. Force Majeure
Notwithstanding any other provision of this Article 9, neither
Motient Services nor Newco shall be liable for any failure of performance of the
terms of this Agreement due solely to acts of God, fires, floods or other
natural catastrophes; national emergencies, insurrections, riots or wars;
strikes, lockouts, work stoppages or other labor difficulties beyond such
parties' reasonable control.
9.8. Subrogation
If any Indemnified Party receives any payment or other
indemnification 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 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.
10. TERMINATION
10.1. Termination
Subject to the provisions of Section 10.2 hereof, this Amended
Sale Agreement may, by written notice given at or prior to the Closing in the
manner hereinafter provided, be terminated:
(a) at any time prior to the Closing by mutual written
consent of the parties hereto;
(b) pursuant to Section 8.9 hereof; or
(c) if the Investment Agreement is terminated pursuant to
Section 11 thereof.
10.2. Effect of Termination
In the event this Amended Sale Agreement is terminated as
provided in this Section 10, this Amended Sale Agreement shall forthwith be of
no further force and effect, and the parties shall be released from all future
obligations hereunder; provided, however, that (i) the termination shall not
relieve any party hereto of liability for any breach of this Amended Sale
Agreement, (ii) Newco shall return all Documents provided by Motient Services to
Newco pursuant to this Amended Sale Agreement and (iii) the indemnification
obligations set forth in Sections 3.7.1, 9.2 and 9.4 and the obligations set
forth in Sections 3.4 and 11.3 shall survive. If the Closing shall not occur, in
no event shall Motient Services be liable for any amount over and above the
Initial Payment and the R&D Fee.
11. MISCELLANEOUS
11.1. Additional Actions and Documents
Each party hereto hereby agrees that, from time to time,
whether before, at or after the Closing, such party will take or cause to be
taken such further actions, to execute, deliver and file or cause to be
executed, delivered and filed such further Documents, and will obtain such
consents, as may be necessary or as may be reasonably requested in order to
fully effectuate the purposes, intent, terms and conditions of this Amended Sale
Agreement.
11.2. No Brokers
Each party hereto represents and warrants to the other party
that such party has not engaged any broker, finder or agent in connection with
the transactions contemplated by this Amended Sale Agreement that will give rise
to any unpaid liability to any broker, finder or agent for any brokerage fees,
finders' fees or commissions, with respect to the transactions contemplated by
this Amended Sale Agreement for which Motient Services or Newco will be
responsible. Each party hereto agrees to indemnify, defend and hold harmless the
other party from and against any and all Claims asserted against such party for
any such fees or commissions by any persons purporting to act or to have acted
for or on behalf of the indemnifying party.
11.3. Expenses
Subject to the indemnity provisions of Article 9, each party
hereto shall pay its own expenses incident to this Amended Sale Agreement and
the transactions contemplated hereunder, including all legal and accounting fees
and disbursements. Each party shall pay any Hart-Scott-Rodino filing fees
payable in connection with any Hart-Scott-Rodino filing required to be made by
such party.
11.4. Assignment
Motient Services shall not assign its rights and obligations
under this Amended Sale 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 Amended Sale 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; provided that the parties acknowledge that the conversion of Newco
into a Delaware limited partnership prior to the Closing shall not constitute an
assignment contrary to the terms of this Section 11.4; provided further that
Newco may assign any or all of its rights and obligations under this Amended
Sale Agreement to a wholly-owned subsidiary of Newco as Newco deems necessary or
appropriate to satisfy FCC requirements. Any assignment contrary to the terms of
this Section 11.4 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 Amended Sale Agreement, whether before, at or
after the Closing, release such party from such party's respective liabilities
and obligations hereunder.
11.5. Entire Agreement; Amendment
This Amended Sale Agreement, including the Disclosure
Schedule, the Exhibits and other Documents referred to herein or furnished
pursuant hereto, constitutes the entire Agreement among the parties hereto with
respect to the transactions contemplated hereby, and it supersedes all prior
oral or written Agreements, commitments or understandings with respect to the
matters provided for herein. No amendment, modification or discharge of this
Amended Sale Agreement shall be valid or binding unless set forth in writing and
duly executed and delivered by the party against whom enforcement of the
amendment, modification, or discharge is sought.
11.6. Waiver
No delay or failure on the part of any party hereto in
exercising any right, power or privilege under this Amended Sale Agreement or
under any other Documents furnished in connection with or pursuant to this
Amended Sale Agreement shall impair any such right, power or privilege or be
construed as a waiver of any default or any acquiescence therein. No single or
partial exercise of any such right, power or privilege shall preclude the
further exercise of such right, power or privilege, or the exercise of any other
right, power or privilege. No waiver shall be valid against any party hereto
unless made in writing and signed by the party against whom enforcement of such
waiver is sought and then only to the extent expressly specified therein.
11.7. Severability
If any part of any provision of this Amended Sale Agreement or
any other Agreement or document given pursuant to or in connection with this
Amended Sale Agreement shall be invalid or unenforceable in any respect, such
part shall be ineffective to the extent of such invalidity or unenforceability
only, without in any way affecting the remaining parts of such provision or the
remaining provisions of this Amended Sale Agreement; unless such invalid or
unenforceable provision(s) are an essential part of the agreed exchange.
11.8. Governing Law
This Amended Sale Agreement is being executed and delivered
in, and shall be governed by and construed in accordance with the laws of the
State of New York, 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 non-exclusive jurisdiction of the courts of the State of New York and of the
United States of America, in each case having jurisdiction over New York County,
for any dispute arising out of or relating to this Amended Sale Agreement and
the Ancillary Agreements and the transactions contemplated hereby and thereby
(and agrees not to commence any litigation relating thereto except in such
courts unless such courts shall have declined to exercise jurisdiction), 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 Amended Sale
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 Amended Sale Agreement or the transactions contemplated
hereby in the courts of the State of New York or the United States of America,
in each case having jurisdiction over New York County, 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 or improper forum.
11.9. 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 Amended Sale 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:
(i) If to Newco:
Mobile Satellite Ventures LLC
10802 Parkridge Boulevard
Reston, Virginia 20191-5416
Attn: General Counsel
Telecopy No.: 703-758-6134
with copies to:
Mobile Satellite Ventures LLC
211 North Union Street, Suite 300
Alexandria, Virginia 22314
Attn: Hal B. Perkins, Esq.
Telecopy No.: 703-706-3801
and
Kirkpatrick & Lockhart LLP
1251 Avenue of the Americas
45th Floor
New York, NY 10020-1104
Attn: William J. Phillips, Esq.
Telecopy No.: 212-536-3901
(ii) If to Motient Services:
Motient Services Inc.
10802 Parkridge Boulevard
Reston, Virginia 20191-5416
Attn: General Counsel
Telecopy No.: 703-758-6134
with a copy to:
Hogan & Hartson L.L.P
8300 Greensboro Drive
Suite 1100
McLean, VA 22102
Attn: Richard K.A. Becker, Esq.
Telecopy No.: 703-610-6200
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.
11.10. Headings
Section headings contained in this Amended Sale Agreement are
inserted for convenience of reference only, shall not be deemed to be a part of
this Amended Sale Agreement for any purpose, and shall not in any way define or
affect the meaning, construction or scope of any of the provisions hereof.
11.11. Interpretation; Absence of Presumption
(a) For the purposes hereof, (i) words in the singular shall be held to include
the plural and vice versa and words of one gender shall be held to include the
other gender as the context requires, (ii) the terms "hereof", "herein", and
"herewith" and words of similar import shall, unless otherwise stated, be
construed to refer to this Amended Sale Agreement as a whole (including all of
the Exhibits hereto) and not to any particular provision of this Amended Sale
Agreement, and Article, Section, paragraph, Exhibit and Schedule to the
Disclosure Schedule references are to the Articles, Sections, paragraphs,
Exhibits and Schedule to the Disclosure Schedule to this Amended Sale Agreement
unless otherwise specified, (iii) the word "including" and words of similar
import when used in this Amended Sale Agreement shall mean "including, without
limitation," unless the context otherwise requires or unless otherwise
specified, (iv) the word "or" shall not be exclusive, and (v) provisions shall
apply, when appropriate, to successive events and transactions.
(b) This Amended Sale Agreement shall be construed without regard to any
presumption or rule requiring construction or interpretation against the party
drafting or causing any instrument to be drafted.
11.12. Execution in Counterparts
To facilitate execution, this Amended Sale Agreement may be
executed in as many counterparts as may be required. It shall not be necessary
that the signatures of, or on behalf of, each party, or that the signatures of
all persons required to bind any party, appear on each counterpart; but it shall
be sufficient that the signature of, or on behalf of, each party, or that the
signatures of the persons required to bind any party, appear on one or more of
the counterparts. All counterparts shall collectively constitute a single
Agreement. It shall not be necessary in making proof of this Amended Sale
Agreement to produce or account for more than a number of counterparts
containing the respective signatures of, or on behalf of, all of the parties
hereto.
11.13. Limitation on Benefits
The covenants, undertakings and agreements set forth in this
Amended Sale Agreement shall be solely for the benefit of, and shall be
enforceable only by, the parties hereto and their respective successors, heirs,
executors, administrators, legal representatives and permitted assigns.
11.14. Binding Effect
Subject to any provisions hereof restricting assignment, this
Amended Sale Agreement shall be binding upon and shall inure to the benefit of
the parties hereto and their respective successors, heirs, executors,
administrators, legal representatives and assigns.
IN WITNESS WHEREOF, the parties hereto have duly executed this
Amended Sale Agreement, or have caused this Amended Sale Agreement to be duly
executed on their behalf, as of the day and year first above written.
MOBILE SATELLITE VENTURES LLC
By: /s/Gary M. Parsons
-----------------------------------------------
Gary M. Parsons, Chairman
MOTIENT SERVICES INC.
By: /s/Gary M. Parsons
-----------------------------------------------
Gary M. Parsons, Chairman
Exhibit Reference Section
A Definitions 1
B Form of Promissory Note 2.2(a)(iii)
C Form of Bill of Sale and Limited Assignment
and Assumption Agreement 8.1(d)
EXHIBIT A
TO AMENDED AND RESTATED ASSET SALE AGREEMENT
DATED AS OF JANUARY 8, 2001
DEFINITIONS
"Affiliate" means: (a) with respect to a person, any member of
such person's family; (b) with respect to an entity, any officer, director, ten
percent or more stockholder, ten percent or more partner or ten percent or more
member of or in such entity or of or in any Affiliate of such entity; and (c)
with respect to a person or entity, any person or entity which directly or
indirectly, through one or more intermediaries, Controls, is Controlled by, or
is under common Control with such person or entity.
"Agreement" means any concurrence of understanding and
intention between two or more persons (or entities) with respect to their
relative rights and/or obligations or with respect to a thing done or to be done
(whether or not conditional, executory, express, implied, in writing or meeting
the requirements of contract), including, without limitation, contracts, leases,
promissory notes, covenants, easements, rights of way, covenants, commitments,
arrangements and memoranda of understanding.
"Ancillary Agreements" means the R&D Agreement and the
Cross-Licensing Agreement.
"Assets" means assets of every kind and everything that is or
may be available for the payment of liabilities (whether inchoate, tangible or
intangible), including, without limitation, real and personal property.
"Benefit Plan" means each funded or unfunded, written or oral,
employee benefit plan, contract, agreement, incentive, salary, wage or other
compensation plan or arrangement, including, but not limited to, each
retirement, pension, profit sharing or savings plan, bonus, deferred
compensation, equity, incentive compensation or severance, health, life
insurance, dental, disability, vacation, and each other employee benefit
program, plan, policy or arrangement, maintained, contributed to, or required to
be contributed to by Motient Services for the benefit of employees, former
employees, directors, agents or consultants involved in the Satellite
Communications Business, or for which Motient Services may be responsible or
with respect to which it may have any liability, whether or not subject to ERISA
and whether legally binding or not. For purposes of this definition, any
reference to the term "Motient Services" shall be deemed to refer also to any
entity which is under common control or affiliated with the Motient Services
within the meaning of Section 4001 of ERISA, and the rules and regulations
promulgated thereunder and/or Sections 414(b), (c), (m) or (o) of the Code and
the rules and regulations promulgated thereunder.
"Claims" means all demands, claims, actions or causes of
action, assessments, losses, damages, liabilities, charges, complaints,
injunctions, judgments, orders, decrees, rulings, dues, fines, amounts paid in
settlement, obligations, liens, costs of environmental investigations and/or
cleanups, Taxes, costs and expenses, including, without limitation, interest,
penalties and attorneys' fees and disbursements.
"Code" means the Internal Revenue Code of 1986, as amended.
"Control" means possession, directly or indirectly, of power
to direct or cause the direction of management or policies (whether through
ownership of voting securities, by Agreement or otherwise).
"Cross-Licensing Agreement" means the Cross-Licensing and Bulk
Resale Agreement, dated as of June 29, 2000, among Motient Communications, Inc.,
Motient Services and Newco, as amended.
"Disclosure Schedule" means the disclosure schedule identified
as the Disclosure Schedule to this Amended Sale Agreement, as updated on the
Closing Date pursuant hereto.
"Documents" means any paper or other material (including,
without limitation, computer storage media) on which is recorded (by letters,
numbers or otherwise) information that may be evidentially used, including,
without limitation, legal opinions, mortgages, indentures, notes, instruments,
leases, Agreements, insurance policies, reports, studies, financial statements
(including, without limitation, the notes thereto), other written financial
information, schedules, certificates, charts, maps, plans, photographs, letters,
memoranda and all similar materials.
"Encumbrance" means any mortgage, lien, pledge, encumbrance,
security interest, deed of trust, option, encroachment, reservation, order,
decree, judgment, condition, restriction, charge, Agreement, Claim or equity of
any kind.
"ERISA" means the Employee Retirement Income Security Act
"FCC" means the United States Federal Communications
Commission or any successor United States federal agency or agencies with
responsibility for licensing the use of the radio frequency spectrum similar to
that of the current agency.
"Financial Statement" shall have the meaning given such term
in Section 4.18.
"Hart-Scott-Rodino" means the Hart-Scott-Rodino Antitrust
Improvements Act of 1976, as amended, and all Laws promulgated pursuant thereto
or in connection therewith.
"Intercompany Agreements" means all Agreements, liabilities
and obligations between Motient Services and Motient Corporation or any of its
direct or indirect subsidiaries, except for the Ancillary Agreements or any
other Agreements delivered in connection herewith.
"Investment Agreement" means that certain January 2001
Investment Agreement, of even date herewith, by and among Motient Corporation,
Newco, TMI Communications Company Limited Partnership and the other parties
named therein.
"Investor Option" means the option to acquire an additional
number of shares of Investor Interests described in Section 2.1 of the
Investment Agreement.
"Laws" means all foreign, federal, state and local statutes,
laws, ordinances, regulations, rules, resolutions, orders, determinations,
writs, injunctions, awards (including, without limitation, awards of any
arbitrator), judgments and decrees applicable to the specified persons or
entities and to the businesses and assets thereof (including, without
limitation, Laws relating to securities registration and regulation; the sale,
leasing, ownership or management of real property; employment practices, terms
and conditions, and wages and hours; building standards, land use and zoning;
safety, health and fire prevention; but excluding Environmental Laws).
"Liability" means any liability (whether known or unknown,
whether asserted or unasserted, whether absolute or contingent, whether accrued
or unaccrued, whether liquidated or unliquidated, and whether due or to become
due) including any liability for Taxes.
"Material Adverse Effect" means a material adverse effect on
the properties, business, prospects, operations, earnings, assets, liabilities
or the condition (financial or otherwise) of Motient Services.
"Motient Services Tax Returns" means all federal, state,
local, foreign and other applicable tax returns, declarations of estimated tax
reports required to be filed by Motient Services.
"Note" shall have the meaning given such term in Section
2.2(a).
"Ordinary Course of Business" means ordinary course of
business consistent with past practices.
"Purchase Price" means Eighty Four Million Dollars
($84,000,000).
"Refund" means an amount equal to the Initial Payment and the
R&D Fee (i.e., a total of $44 million) subject to reduction pursuant to Section
8.10.
"R&D Agreement" means the Research & Development, Marketing
and Service Agreement, dated as of June 29, 2000, as amended, between Newco and
Motient Services, as amended.
"R&D Fee" means the $20 million fee paid by Newco to Motient
Services pursuant to the R&D Agreement.
"Securities Act" means the Securities Act of 1933, as amended,
and all laws promulgated pursuant thereto or in connection therewith.
"Shared Assets" shall have the meaning given such term in
Section 8.5(a).
"Taxes" means all federal, state, local and foreign taxes
(including, without limitation, income, profit, franchise, sales, use, real
property, personal property, ad valorem, excise, employment, social security and
wage withholding taxes) and installments of estimated taxes, assessments,
deficiencies, levies, imposts, duties, withholdings, or other similar charges of
every kind, character or description imposed by any governmental authorities,
and any interest, penalties or additions to tax imposed thereon or in connection
therewith.
"Tax Liabilities" means any action, suit, proceeding, audit,
investigation or Claim pending or threatened in respect of any Taxes for which
Motient Services is or may become liable, or any deficiency or Claim for any
such Taxes that has been to Motient Services' knowledge proposed, asserted or
threatened.
"Tax Return" means any return, declaration, report, claim for
refund, or information return or statement relating to Taxes, including any
schedule or attachment thereto, and including any amendment thereof.
"Transportation Market" means organizations engaged in the
carriage and delivery of goods in the United States in the following market
segments, as identified by the Department of Transportation: truckload (or
long-haul) (including "for hire" and "rental/lease"), less-than-truckload
(including "for hire" and "rental/lease"), private carriers and railway
carriers; it does not include the courier or package delivery business.
EXHIBIT B
Form of Promissory Note
EXHIBIT C
BILL OF SALE AND
LIMITED ASSIGNMENT AND ASSUMPTION AGREEMENT
THIS BILL OF SALE AND LIMITED ASSIGNMENT AND ASSUMPTION
AGREEMENT ("Bill of Sale") is made on _________ , 20__ by Motient Services,
Inc., a Delaware corporation ("Seller") and Motient Satellite Ventures LLC, a
Delaware limited liability company ("Buyer"). Capitalized terms used herein and
not otherwise defined shall have the meanings ascribed to them in that certain
Amended and Restated Asset Sale Agreement, dated as of January 8, 2001 (the
"Sale Agreement").
WHEREAS, Seller and Buyer, have entered into the Sale
Agreement, whereby Seller has agreed to sell to Buyer, and Buyer has agreed to
purchase from Seller, certain tangible and intangible assets and rights of
Seller, all in accordance with and subject to the terms and conditions set forth
in the Sale Agreement;
WHEREAS, the Sale Agreement provides that Buyer shall assume
certain, specified liabilities and obligations of Seller, but only such
specified liabilities and obligations;
NOW, THEREFORE, for and in consideration of the payment by
Buyer of the Purchase Price, and in further consideration of the mutual
covenants and agreements contained in the Sale Agreement, and pursuant to the
terms of the Sale Agreement, Seller does hereby bargain, sell, assign, transfer,
convey and deliver to Buyer and its successors and assigns all right, title,
benefit, and interest of Seller in and to the Subject Assets (as defined in the
Sale Agreement) and Buyer hereby assumes and agrees to keep, observe, perform,
pay and discharge when due and payable or when such keeping, observing,
performing, paying or discharging is required and agrees to be solely
responsible for all of the Assumed Liabilities (as defined in the Sale
Agreement). The indemnification obligations of the parties shall be governed
exclusively by the Sale Agreement.
TO HAVE AND TO HOLD the said described property unto Buyer and
its successors and assigns for their exclusive use and benefit forever.
Except for the liabilities and obligations expressly assumed
by Buyer hereby, Buyer shall not assume or be deemed to assume or have any
responsibility for any debts, liabilities or obligations of any kind or
description of Seller, whether connected with the Satellite Communications
Business, the Subject Assets or otherwise
Nothing in this Bill of Sale shall alter any liability or
obligation of Seller arising under the Sale Agreement, which shall govern the
representations and warranties and the obligations of the parties with respect
to the Assets. Nothing in this Bill of Sale shall be deemed to create or imply
any right or benefit in any person other than Seller, Buyer or their respective
successors and assigns.
This Bill of Sale shall be governed and enforced in accordance
with the laws of the State of New York.
This Bill of Sale shall be subject in all respects to the Sale
Agreement and shall be construed so as to carry out the intentions of the
parties thereto as expressed in the Sale Agreement. In the event of a conflict
between the terms and conditions of this Bill of Sale and the terms and
conditions of the Sale Agreement, the terms and conditions of the Sale Agreement
shall govern, supersede and prevail.
The parties do hereby agree, from and after the date hereof
upon the request of Buyer, to execute such other documents as the other may
reasonably require in order to obtain the full benefit of this Bill of Sale.
IN WITNESS WHEREOF, the undersigned has caused this Bill of
Sale to be duly executed, and the appropriate corporate seal affixed, as of the
date first written above.
Seller:
[Seal] MOTIENT SERVICES Inc.
Attest:
___________________________ By: ________________________(SEAL)
Name: ____________________________
Title: ___________________________
Buyer:
[Seal] MOBILE SATELLITE VENTURES LLC
Attest:
___________________________ By: ________________________(SEAL)
Name: ____________________________
Title: ___________________________