Execution Copy
ASSUMPTION, RELEASE,
AMENDMENT AND WAIVER AGREEMENT
This Assumption, Release, Amendment and Waiver Agreement (this
"Agreement") is entered into as of December 29, 2000 by and among Motorola,
Inc., a Delaware corporation ("Motorola"), Motient Communications Inc., a
Delaware corporation ("You" or the "New Borrower") and Motient Communications
Company (formerly known as ARDIS Company), a New York general partnership (the
"Existing Borrower").
RECITALS
A. Motorola and the Existing Borrower are parties to that certain Credit
Agreement dated as of June 17, 1998, as amended by Amendment No. 1 to Credit
Agreement dated as of October 15, 1998, as further amended by Amendment No. 2 to
Credit Agreement dated as of September 1, 2000 (as so amended, the "Original
Credit Agreement" and as further amended by this Agreement, the "Credit
Agreement"). Capitalized terms used herein without definition shall have the
meanings ascribed to them in the Credit Agreement;
B. In connection with a contemplated corporate restructuring, the parties
hereto have advised Motorola that (a) the Existing Borrower intends to assign
all of its assets and liabilities on a pro rata basis to its two general
partners, New Borrower and Motient Partner Inc., a Delaware corporation ("MPI"),
and thereafter dissolve and wind up its affairs and (b) contemporaneously
therewith, MPI intends to merge with and into the New Borrower, with the New
Borrower surviving the merger (such contemplated corporate restructuring as
described to Motorola by the parties hereto and in documents previously provided
to Motorola, the "Restructuring");
C. The Restructuring is not permitted under the terms and conditions of the
Original Credit Agreement;
D. The parties hereto have requested that Motoroloa (a) waive certain
provisions of the Original Credit Agreement in order to permit the consummation
of the Restructuring; (b) amend the Original Credit Agreement to join New
Borrower as a "Borrower" under the Credit Agreement; and (c) release the
Existing Borrower from its liabilities and obligations as a "Borrower" under the
Credit Agreement; and
E. Motorola is willing to agree to such requests, in each case on the terms
and subject to the conditions set forth herein;
NOW, THEREFORE, in consideration of the foregoing and the mutual agreements
contained herein, and subject to the terms and conditions hereof, the respective
parties hereto hereby agree as follows:
1. Joinder and Assumption. Effective as of the date hereof, upon satisfaction of
the conditions precedent set forth in Section 6 below, and in reliance upon the
representations and warranties of the New Borrower set forth herein, Motorola
and the New Borrower hereby acknowledge and agree that, by New Borrower's
execution and delivery hereof, without any further notice or action of any kind
whatsoever on its part or on the part of any other person that:
(a) for all purposes, the New Borrower is hereby joined automatically as a
"Borrower" party to the Credit Agreement, being hereafter bound by all of
the respective terms and provisions thereof; and
(b) New Borrower assumes and becomes liable for the prompt payment, observance
and performance of all Obligations,
in the case of both clause (a) and (b) above, to the same extent and with
the same force and effect as if New Borrower had been a "Borrower" under
and an original signatory to the Credit Agreement.
2. Release of Existing Borrower. Effective as of the date hereof, upon
satisfaction of the conditions precedent set forth in Section 6 below, Motorola
hereby releases the Existing Borrower from all obligations and liabilities under
the Credit Agreement and the Existing Borrower shall thereafter have no
liability or obligations under the Credit Agreement.
3. Amendments to Credit Agreement. Effective as of the date hereof, upon
satisfaction of the conditions precedent set forth in Section 6 below, all
references to "Motient Communications Company" in the Credit Agreement are
hereby amended and deemed to be references to "Motient Communications Inc."
4. Consent and Waiver.
(a) Motorola hereby consents to the Restructuring and to the consummation of
the actions contemplated thereby, including the assignment by the Existing
Borrower of all of its assets and liabilities on a pro rata basis to the
New Borrower and MPI; provided, however, that each of the New Borrower and
MPI shall take such assets subject to Motorola's security interest therein
as perfected against the Existing Borrower and the liquidiation and
dissolution of the Existing Borrower.
(b) Any breach of the provisions of Sections 4.4, 5.2 and 9.6 of the Credit
Agreement arising as a result of the Restructuring is hereby waived.
5. Representations and Warranties. In order to induce Motorola to enter into
this Agreement, the New Borrower hereby represents to Motorola the following,
except as otherwise disclosed to Motorola in writing concurrently with the
execution of this Agreement:
(a) Status. You are duly incorporated or formed, and validly
existing under the laws of the state of incorporation or formation. You
(a) have the power and authority and the legal right to own and operate
your property, to lease the property you operate, and to conduct the
business in which you are currently engaged and in which you propose to
engage, (b) are in compliance with all Requirements of Law except to
the extent that the failure to comply therewith could not, in the
aggregate, have a material adverse effect on your business, operations,
assets (taken in the aggregate) or financial condition, and could not
materially adversely affect your ability to perform your obligations
under this Agreement or the Credit Agreement and (c) have qualified to
do business in all jurisdictions where your ownership, lease or
operation of property or the conduct of your business requires such
qualification or recording, except to the extent that the failure to so
qualify could not, in the aggregate, have a material adverse effect on
your business, operations, assets (taken in the aggregate) or financial
condition, and could not materially adversely affect your ability to
perform your obligations under this Agreement and the Credit Agreement.
(b) Power and Authority. You have the power, authority and
legal right to execute, deliver and perform this Agreement and the
Credit Agreement and to borrow under the Credit Agreement, and have
taken all necessary action to authorize the Credit on the terms and
conditions of the Credit Agreement and to authorize the execution,
delivery and performance of this Agreement and the Credit Agreement and
the related documents described herein and therein. Where any
Governmental Authority, including without limitation any PUC, requires
consents, filings or authorizations prior to the Credit, you shall have
obtained all such consents, filings or authorizations. Other than such
consents, filings or authorizations, no consent or authorization or
filing with, or other act by or with respect to any Governmental
Authority, is required in connection with the Credit under the Credit
Agreement or with the execution, delivery, performance, validity or
enforceability of this Agreement or the performance, validity or
enforceability of the Credit Agreement. This Agreement has been duly
executed and delivered and this Agreement and the Credit Agreement
constitutes your legal, valid and binding obligation, which obligation
shall be enforceable against you in accordance with the terms of the
Agreement or the Credit Agreement, as the case may be, except as
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the enforcement of
creditors' rights generally and general equitable principles.
(c) No Violations. The execution, delivery and performance of
the Agreement and the use of the proceeds of the Credit (i) will not
violate, be in conflict with, result in a breach of or constitute a
default under, any Requirement of Law or any of your contractual
obligations, except to the extent such violations, in the aggregate,
could not have a material adverse effect on (a) your business,
operations, assets (taken in the aggregate) or financial condition, or
(b) your ability to perform your obligations under the Agreement or the
Credit Agreement, and (ii) will not result in, or require, the creation
or imposition of any Lien on any of your properties or revenues
pursuant to any Requirement of Law or contractual obligation, other
than pursuant to the Agreement or the Credit Agreement. You are in
compliance with the Employee Retirement Income Security Act of 1974 as
amended from time to time (ERISA), and neither the execution nor the
performance of the Agreement nor the performance of the Credit
Agreement by you will result in any violation of ERISA. Any benefit
plan that is subject to ERISA has been properly accounted for in
Financial Statements attached to the Credit Agreement.
(d) No Pending Actions. No litigation, investigation or
proceedings of or before any arbitrator or Governmental Authority is
pending, or, to your knowledge is threatened, against you or, against
any of your properties or revenues (a) with respect to the Agreement or
any of the transactions contemplated thereby, or (b) which is
reasonably expected to be adversely determined, and which, if adversely
determined, could, individually or in the aggregate, have a material
adverse effect on your business, operations, assets (taken in the
aggregate) or financial condition.
(e) No Defaults. You are not in default under or with respect
to any contractual obligation where such default could be materially
adverse to your business, operations, assets (taken in the aggregate)
or financial condition, or which could materially and adversely affect
your ability to perform your obligations under the Agreement or the
Credit Agreement. No Default or Event of Default has occurred and is
continuing.
(f) Good Title. Any of your leases are in full force and
effect, and you enjoy peaceful and undisturbed possession thereunder;
you have a recorded title in fee simple to all your owned real
property, and good and marketable title to all your other personal
property.
(g) Taxes. You have filed or caused to be filed all material
tax returns which are required by law to be filed, and have paid all
taxes shown to be due and payable on said returns or on any assessment
made by any Governmental Authority (other than those the amount or
validity of which is currently being contested in good faith by
appropriate proceedings and with respect to which reserves in
conformity with GAAP have been provided on your books); and no tax
Liens have been filed and, to your knowledge, no claims are being
asserted with respect to any such taxes, fees or other charges other
than inchoate Liens for taxes not yet due.
(h) No Extending of Credit. You have not engaged nor will you
generally engage in the business of purchasing or selling Margin Stock
(as defined in Regulation G, T, U or X of the Board of Governors or of
the Federal Reserve System) extending credit for the purpose of
purchasing Margin Stock.
(i) No Subsidiaries. You have no subsidiaries and do not
control, directly or indirectly, any other business entity.
(j) Patents, Trademarks, etc. You own or have the right to use
all of the patents, trademarks, permits, service marks, trade names,
copyrights, licenses and franchises or rights with respect to the
foregoing (collectively "patents"), necessary for the conduct of your
business as presently contemplated, without any known conflict with the
rights of others.
(k) Information, Reports, etc. All information, reports and
other papers and data furnished to Motorola by you on or at any time
after the date hereof are or will be, at the time the same are so
furnished, complete and correct in all material respects; and all
projections concerning your business furnished by you, as supplemented,
will be prepared or presented in good faith by you and have a
reasonable basis. No fact is known to you which materially and
adversely affects or in the future may (so far as you can reasonably
foresee) materially and adversely affect the business, operations,
assets (taken as a whole) or your financial condition which has not
been set forth in the Financial Statements or in such information,
reports, papers and data.
(l) Security Documents. The provisions of the Credit Agreement
are effective to create in favor of Motorola a legal, valid and
enforceable security interest in all of the New Borrower's right, title
and interest in the Collateral in which a security interest may be
created under Article 9 of the Uniform Commercial Code; and when (i)
financing statements have been filed in the offices in the
jurisdictions listed in Exhibit "E" to the Credit Agreement, and (ii)
except for any further filing or taking of possession which may be
required under Section 9-306 of the UCC in order to perfect a security
interest in proceeds of the Collateral and any taking of possession
which may be required under the UCC in order to perfect a security
interest in instruments, the Credit Agreement will create and grant a
fully perfected first Lien on, and security interest in the Collateral
(including proceeds) in which a security interest may be perfected
under Article 9 of the UCC.
(m) Governmental Regulation. You hold sufficient FCC licenses
for the conduct of your business in each area in which you currently
conduct your business. All of such licenses are valid, uncontested and
in full force and effect.
(n) Assumed Names. You are not doing business under any
fictitious or assumed names, except as disclosed in Exhibit "F" to the
Credit Agreement.
(o) Principal Place of Business. Your chief executive office
and principal place of business are located at the notice address shown
next to your signature block below. Your books and records with respect
to the Collateral are kept at this address.
(p) Environmental and Safety Matters. You are in compliance in
all material respects with all federal, state, local and other
statutes, ordinances, orders, judgments, rulings and regulations
relating to the environment, environmental regulation or control,
employee health and safety, or the generation, use, storage, disposal
or transportation of toxic or hazardous materials, substances or wastes
(collectively, "Environmental Laws").
(q) Collateral. You represent that each of the items of
Collateral delivered prior to the date of this Agreement is identified
by serial number in Exhibit D to this Agreement, and is located as of
the date of this Agreement in the jurisdiction listed in Exhibit D.
6. Conditions to Effectiveness. This Agreement shall become effective, and
Motorola's commitment to provide the Credit to you as set forth in the Credit
Agreement shall be conditioned upon, the satisfaction of each of the following
conditions precedent:
(a) No Default or Event of Default shall have occurred and be continuing,
and you shall have delivered to Motorola a certificate of Randy S.
Segal, Senior Vice President and General Counsel, to such effect.
(b) You shall have delivered to Motorola executed counterparts of this
Agreement, and an executed original of the Amended and Restated
Promissory Note in the form attached hereto as Exhibit A (the "Note").
(c) You shall have delivered to Motorola a certificate of the Secretary or
other authorized officer of the New Borrower as to resolutions of its
Board of Directors authorizing the execution, delivery and performance
by the New Borrower of this Agreement, the Note, and the other
documents and instruments to be delivered by the New Borrower
hereunder.
(d) You shall have delivered to Motorola an Amended and Restated Guarantee
Agreement of each of Motient Corporation (formerly American Mobile
Satellite Corporation) and Motient Holdings Inc. (formerly AMSC
Acquisition Company, Inc.), each in the form attached hereto as
Exhibit B and Exhibit C respectively.
(e) You shall have delivered to Motorola a certificate of the Secretary or
other authorized officer of each of the Guarantors as to resolutions of
the Board of Directors of such Guarantor authorizing the execution,
delivery and performance by such Guarantor of the Amended and Restated
Guarantee Agreement to be delivered by it hereunder and the other
documents and instruments to be delivered by the New Borrower
hereunder.
(f) You shall have delivered to Motorola a certificate or certificates
certifying the incumbency of the officer or officers executing this
Agreement, the Note, each Amended and Restated Guarantee Agreement, and
each other document and instrument delivered hereunder.
(g) You shall have delivered to Motorola an opinion of counsel
satisfactory to Motorola as to (i) the due organization and valid
existence of each of the New Borrower and each Guarantor, (ii) the due
authorization, execution, delivery and enforceability of the Credit
Agreement, as amended by the Agreement, the Note, the Amended and
Restated Guarantees, and each other document and instrument delivered
hereunder, (iii) the absence of any violation or breach of other
agreements or applicable Laws, (iv) the absence of material litigation
pending or threatened against the New Borrower and each Guarantor, and
(v) and as to such other matters as Motorola shall reasonably request,
including without limitation, that the Restructuring has been
completed and as a result title to Collateral financed under the
Credit Agreement has been legally transferred to New Borrower.
(h) You shall have delivered each other document and instrument as
Motorola shall have reasonably requested.
Motorola's obligation to fund Advances under the Credit Agreement shall be
subject to each of the conditions set forth in Section 8 of the Terms and
Conditions.
7. Ratification of Credit Agreement. Except as amended hereby, the parties
hereto hereby ratify and confirm the Credit Agreement, and all of the terms set
forth or incorporated therein.
8. Governing Law. This Agreement will be governed by the law of Illinois without
regard to its conflicts of law rules.
9. Counterparts. This Agreement may be executed in one or more counterparts
which, taken together, shall constitute one and the same instrument.
[signature page follows]
Executed by the parties hereto as of the date first set forth above.
MOTIENT COMMUNICATIONS COMPANY
By: /s/ Richard J. Burnheimer
------------------------------
Its: Vice President and Treasurer
MOTIENT COMMUNICATIONS INC.
By: /s/ Richard J. Burnheimer
-----------------------------
Its: Vice President and Treasurer
MOTOROLA, INC.
By: /s/ Walter Keating
-----------------------------
Its: Vice President
Exhibit A
Form of Note
Exhibit B
Form of Motient Corporation
Amended and Restated Guarantee
Exhibit C
Form of Motient Holdings Inc.
Amended and Restated Guarantee
Exhibit D
Collateral