EXHIBIT 4.4.5
EXECUTION COPY
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AMENDED AND RESTATED
PLEDGE AGREEMENT
Among
CD RADIO INC.
as Pledgor
IBJ WHITEHALL BANK AND TRUST COMPANY
as Trustee
UNITED STATES TRUST COMPANY OF NEW YORK
as Trustee
and
IBJ WHITEHALL BANK AND TRUST COMPANY
as Collateral Agent
Dated as of May 15, 1999
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TABLE OF CONTENTS
Page
1. Grant of Security Interest..............................................2
2. Security for Obligations................................................3
3. Delivery of Pledged Collateral..........................................4
4. Representations and Warranties..........................................5
5. As to the Pledged Collateral............................................7
6. Additional Shares.......................................................9
7. Payment of Taxes and Claims............................................10
8. Covenants and Agreements...............................................11
9. The Collateral Agent Appointed Attorney-in-Fact........................13
10. The Collateral Agent May Perform.......................................14
11. The Collateral Agent's Duties..........................................14
12. Events of Default......................................................14
13. Notice of Event of Default.............................................15
14. Remedies...............................................................15
15. Expenses...............................................................17
16. Repayment in Bankruptcy, etc...........................................17
17. No Segregation of Moneys; No Interest..................................18
18. Continuing Security Interest; Termination..............................18
19. Notices................................................................19
20. Margin Regulations.....................................................19
21. Other Provisions.......................................................19
AMENDED AND RESTATED PLEDGE AGREEMENT
AMENDED AND RESTATED PLEDGE AGREEMENT (this
"Agreement"), dated as of May 15, 1999, made by CD
RADIO INC., a Delaware corporation (the "Pledgor"),
to IBJ WHITEHALL BANK AND TRUST COMPANY (formerly
known as IBJ Schroder Bank and Trust Company), as
collateral agent (the "Collateral Agent") for the
holders (the "Holders") from time to time of the
Notes (as defined herein), IBJ WHITEHALL BANK AND
TRUST COMPANY, as trustee for the Old Notes (as
defined herein), and UNITED STATES TRUST COMPANY OF
NEW YORK, as trustee for the New Notes (as defined
herein).
The Pledgor and the Collateral Agent are parties to the Pledge
Agreement dated as of November 26, 1997 pursuant to which the Pledgor granted a
first priority security interest in the issued and outstanding capital stock
described in Schedule I hereto (the "Pledged Shares") representing 100% of the
issued and outstanding capital stock of Satellite CD Radio, Inc., a Delaware
corporation (the "Subsidiary"), to the Collateral Agent to secure the
obligations of the Pledgor pursuant to the Indenture dated as of November 26,
1997 (as amended, restated, supplemented or modified from time to time, the "Old
Note Indenture") between the Pledgor and IBJ Whitehall Bank and Trust Company
(formerly known as IBJ Schroder Bank and Trust Company), as trustee (in such
capacity, the "Old Note Trustee") pursuant to which the Pledgor issued
$296,930,000 aggregate principal amount at maturity of its 15% Senior Secured
Discount Notes due 2007 (the "Old Notes").
The Pledgor and United States Trust Company of New York, as
trustee (in such capacity, the "New Note Trustee"), have entered into that
certain indenture dated the date hereof (as amended, restated, supplemented or
otherwise modified from time to time, the "New Note Indenture"), pursuant to
which the Pledgor is issuing $200,000,000 aggregate principal amount of its
14-1/2% Senior Secured Notes due 2009 (the "New Notes", and together with the
Old Notes, the "Notes").
The Pledgor and the Collateral Agent desire to amend and
restate the Pledge Agreement to grant a first priority security interest in the
Pledged Shares to the Collateral Agent for the benefit of the Old Note Trustee,
the New Note Trustee and the ratable benefit of the Holders (the amount of such
ratable benefit to be determined in the case of the Old Notes, with respect to
the Accreted Value (as defined in the Old Note Indenture) of the Old Notes
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outstanding at such time, and in the case of the New Notes, with respect to the
principal amount of the New Notes outstanding at such time).
Capitalized terms used herein without definition are used
herein as defined in the New Note Indenture.
In consideration of the premises, the agreements herein
contained and other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, and in order to induce the prospective holders
of the New Notes to purchase the New Notes, the Pledgor and the Collateral Agent
hereby agree to amend and restate the Pledge Agreement pursuant hereto and the
Pledgor hereby covenants and agrees with the Collateral Agent, the Old Note
Trustee and the New Note Trustee for their benefit and for the ratable benefit
of the Holders.
1. Grant of Security Interest. (a) The Pledgor hereby
unconditionally assigns, pledges and grants to the Collateral Agent for its
benefit, the benefit of the Old Note Trustee, the benefit of the New Note
Trustee and the ratable benefit of the Holders, a first priority security
interest in and to all of the Pledgor's right, title and interest in and to the
following, whether now owned or existing or hereafter arising or acquired and
wheresoever located (collectively, the "Pledged Collateral"):
(i) the Pledged Shares and the certificates representing the
Pledged Shares, and all dividends, cash, instruments and other property
from time to time received, receivable or otherwise distributed in
respect of or in exchange for any or all of the Pledged Shares;
(ii) all additional shares of issued and outstanding shares,
interests, participations, warrants or other equivalents (however
designated) of corporate stock ("Stock") of the Subsidiary from time to
time acquired by the Pledgor in any manner, and the certificates
representing such additional shares, and all dividends, cash,
instruments and other property from time to time received, receivable
or otherwise distributed in respect of or in exchange for any or all of
such shares; and
(iii) all Proceeds (as defined herein) of any and all of the
foregoing Pledged Collateral (including, without limitation, proceeds
that constitute property of the types described in clauses (i) and (ii)
above).
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(b) As used herein, the term "Proceeds" shall have the meaning
assigned to such term under Article 9 of the Uniform Commercial Code from time
to time in effect in the State of New York (the "UCC"; provided that in the
event that, by reason of mandatory provisions of law, any or all of the
attachment, perfection or priority of the Collateral Agent's security interest
in any Pledged Collateral is governed by the Uniform Commercial Code as in
effect in a jurisdiction other than the State of New York, the term "UCC" shall
mean the Uniform Commercial Code as in effect in such other jurisdiction for
purposes of the provisions hereof relating to such attachment, perfection or
priority and for purposes of definitions related to such provisions) and, to the
extent not otherwise included, shall include, but not be limited to: (i) any
stock dividend or distribution in connection with any increase or reduction of
capital, reclassification, merger, consolidation, sale of assets, combination of
shares, stock split, spin-off or split-off; (ii) any option or other right,
whether as an addition to, in substitution of or in exchange for any Pledged
Shares or otherwise; (iii) distributions payable in property (whether real,
personal, tangible, intangible, or mixed property; collectively "Property");
(iv) dividends or distributions on dissolution, or in partial or total
liquidation, or from capital, capital surplus or paid-in surplus; (v) any and
all payments (in any form whatsoever) made or due and payable to the Pledgor
from time to time in connection with any requisition, confiscation,
condemnation, seizure or forfeiture of all or any part of the Pledged Collateral
by any nation or government, any state or other political subdivision thereof,
any entity exercising executive, legislative, judicial, regulatory or
administrative functions of or pertaining to government and any court or
arbitrator (a "Governmental Body"); and (vi) any and all other amounts from time
to time paid or payable under or in connection with the Pledged Collateral.
2. Security for Obligations. This Agreement, together with the
Pledged Collateral, secures the payment of all of the obligations and
liabilities of any kind of the Pledgor under this Agreement, the Old Note
Indenture, the New Note Indenture or the Notes, whether liquidated,
unliquidated, direct, indirect, fixed, contingent, matured, unmatured, disputed,
undisputed, legal, equitable, secured or unsecured, and whether for principal,
interest, fees, costs, expenses or otherwise (whether arising or accruing before
or after the occurrence of any Event of Default (as defined herein) and whether
discharged, stayed or otherwise affected or allowed as a claim in any bankruptcy
proceeding of the Subsidiary), and all costs, fees and expenses of the
Collateral Agent, the Old Note Trustee, the New Note Trustee
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or the Holders (including reasonable attorneys' fees and expenses and with
respect to the Collateral Agent, reasonable allocated costs and expenses of
in-house counsel and legal staff) in enforcing, preserving and protecting its
rights against the Pledgor, whether or not suit is instituted (as the foregoing
obligations and liabilities may be amended, increased, modified, renewed,
refinanced, refunded or extended from time to time) (collectively, the "Secured
Obligations"), now or hereafter existing. Without limiting the generality of the
foregoing, this Agreement secures the payment of all amounts that constitute
part of the Secured Obligations and would be owed by the Pledgor to the
Collateral Agent, the Old Note Trustee, the New Note Trustee or the Holders
under this Agreement, the Old Note Indenture, the New Note Indenture and the
Notes but for the fact that they are unenforceable or not allowable due to the
existence of a bankruptcy, reorganization or similar proceeding involving the
Pledgor. Notwithstanding anything herein to the contrary, the Old Note
Obligations (as defined in the Intercreditor Agreement) and the New Note
Obligations (as defined in the Intercreditor Agreement) are the only such
obligations that may be secured by the Pledged Collateral unless otherwise
permitted by both the Old Note Indenture and the New Note Indenture.
3. Delivery of Pledged Collateral. (a) All certificates and
other instruments at any time owned or acquired by the Pledgor representing or
evidencing the Pledged Shares shall be delivered to and held by or on behalf of
the Collateral Agent pursuant hereto and shall be in suitable form for transfer
by delivery, or shall be accompanied by duly executed instruments of transfer or
assignment in blank, all in form and substance satisfactory to the Collateral
Agent. Upon the occurrence and during the continuance of an Event of Default (as
defined herein), the Collateral Agent shall have the right, upon written
instructions from the Old Note Trustee or the New Note Trustee and without
notice to the Pledgor, to transfer to or to register in the name of the
Collateral Agent or any of its nominees any or all of the Pledged Collateral. In
addition, upon the occurrence and during the continuance of an Event of Default,
the Collateral Agent shall have the right at any time to exchange certificates
or instruments representing or evidencing Pledged Collateral for certificates or
instruments of smaller or larger denominations.
(b) If there shall occur a change in applicable law or
regulations regarding (i) the steps necessary to obtain and maintain a perfected
security interest in any Pledged Collateral or (ii) the ability to obtain a
security
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interest directly in any license granted by the Federal Communications
Commission or Governmental Body succeeding to the functions thereof (the "FCC"),
or if there is Pledged Collateral for which the foregoing procedures are not
effective to perfect a security interest, the Pledgor will immediately upon its
becoming aware thereof so notify the Collateral Agent and will deliver to the
Collateral Agent an Opinion of Counsel setting forth the steps necessary for the
Collateral Agent to obtain and maintain such a perfected security interest in
the Pledged Collateral affected by such change or for which the foregoing
procedures are not effective to perfect a security interest, and the Pledgor and
the Collateral Agent, instead of (or in addition to) the actions specified in
this Section 3, shall take such other action, as specified in such Opinion of
Counsel, as will create and maintain such perfected security interest.
(c) Upon the execution and delivery of this Agreement, the
Pledgor will file proper financing statements or amendments thereto with the
appropriate office or offices under the Uniform Commercial Code in the State of
New York, covering the Pledged Collateral described in this Agreement and,
thereafter, such renewals, amendments or continuations thereof or such
additional financing statements in such additional offices in such jurisdictions
or in the appropriate filing offices in such additional jurisdictions as shall
be required from time to time under the UCC in order to perfect and to continue
the perfection of the security interest in the Pledged Collateral.
4. Representations and Warranties. The Pledgor hereby
represents and warrants to the Collateral Agent as follows:
(a) Organization; Good Standing. The Pledgor is duly
organized, validly existing and in good standing under the laws of the
State of Delaware and is duly qualified and in good standing in every
other jurisdiction where it is doing business, except where the failure
to be so qualified or maintain good standing would not have a Material
Adverse Effect (as defined herein). The chief place of business and
chief executive office of the Pledgor are located at 1221 Avenue of the
Americas, New York, New York 10020.
(b) Corporate Power; Authorization. The execution, delivery
and performance by the Pledgor of this Agreement, and the consummation
of the transactions contemplated hereby, (i) are within the Pledgor's
corporate authority; (ii) have been duly authorized by all necessary or
proper corporate action;
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(iii) are not in contravention of any provision of the Pledgor's
by-laws or certificate of incorporation; (iv) will not violate any law
or regulation, or any order or decree of any court or governmental
instrumentality to which the Pledgor or its property is subject; and
(v) will not conflict with or result in the breach or termination of,
constitute a default under, or accelerate any performance required by,
any indenture, mortgage, deed of trust, lease, agreement or other
instrument to which the Pledgor is a party or by which the Pledgor or
any of its property is bound (except for such conflict, breach,
termination, default or acceleration as could not reasonably be
expected to have a Material Adverse Effect (as defined herein)).
Subject to Section 21(f) hereof, no authorization, approval or action
by, or notice to, or filing with, any governmental authority or
regulatory body is required under existing laws and regulations on the
date hereof (A) for the grant or perfection of the security interests
contemplated hereby or for the execution, delivery or performance of
this Agreement by the Company, except as may be set forth in Section 3
with respect to actions to be taken by the Collateral Agent, the Old
Note Trustee or the New Note Trustee or a financial intermediary
holding Pledged Collateral and except for the filings referred to in
Section 3(b) that may be required in the future, or (B) for the
exercise by the Collateral Agent of the voting or other rights provided
for in this Agreement or its rights and remedies in respect of the
Pledged Collateral pursuant to this Agreement, except (1) as may be
required in connection with the disposition of Pledged Collateral by
laws affecting the offering and sale of securities, generally, and (2)
with respect to Pledged Shares, for authorizations, approvals, notices
and filings that may be required pursuant to regulations of the FCC (as
defined herein), or any successor laws or regulations.
(c) Enforceability. This Agreement is the legal, valid and
binding obligation of the Pledgor enforceable against it in accordance
with its terms, subject to applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting creditors' rights
or insolvent corporations generally, and except to the extent that
availability of the remedy of specific performance or injunctive relief
is subject to the discretion of the court before which any proceeding
therefor may be brought.
(d) Absence of Liens. It is the legal and beneficial owner of
the Pledged Collateral free and
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clear of all Liens other than the security interest created by this
Agreement. No effective financing statement or other instrument similar
in effect covering all or any part of the Collateral is on file in any
recording office, except such as may have been filed in favor of the
Collateral Agent under this Agreement.
(e) Pledged Collateral. The Pledged Shares have been duly
authorized and validly issued and are fully paid and nonassessable. The
Pledged Shares represent 100% of the total number of shares of the
Subsidiary which are issued and outstanding or for which the Subsidiary
is obligated to issue after giving effect to the issuance of all such
shares.
(f) Security Interest. This Agreement and the pledge of the
Pledged Collateral pursuant hereto create a valid and perfected first
priority security interest in the Pledged Collateral in favor of the
Collateral Agent, securing the payment of all of the Secured
Obligations, and all filings and other actions necessary or desirable
as may be required by the Old Note Trustee or New Note Trustee or the
Holders to perfect and protect such security interest have been duly
taken.
5. As to the Pledged Collateral. (a) So long as no event or
circumstance which constitutes a Default shall have occurred and be continuing:
(i) The Pledgor shall be entitled to exercise any and all
voting and other consensual rights pertaining to the Pledged Collateral
or any part thereof for any purpose not inconsistent with the terms of
this Agreement, the Old Note Indenture or the New Note Indenture;
provided, however, that the Pledgor shall not exercise or refrain from
exercising any such right without the consent of the Collateral Agent
if, in the Collateral Agent's judgment, such action or inaction would
have a Material Adverse Effect (as defined herein) on the fair market
value of any of the Pledged Collateral including, without limitation,
the validity, priority or perfection of the security interests granted
hereby or the remedies of the Collateral Agent hereunder.
(ii) Any and all dividends and other distributions (whether or
not in cash) paid or payable, and certificates, instruments and other
Property received, receivable or otherwise distributed in respect of,
or
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in exchange for, Pledged Collateral, shall be, and shall be forthwith
delivered to the Collateral Agent to be held as Pledged Collateral and
shall, if received by the Pledgor, be received in trust for the benefit
of the Old Note Trustee, the New Note Trustee and the Holders, be
segregated from the other Property of the Pledgor, and be forthwith
delivered to the Collateral Agent, as Pledged Collateral in the same
form as so received (with any necessary endorsement). Any cash
dividends or distributions delivered to or otherwise held by the
Collateral Agent pursuant to this Section 5, and any other cash
constituting Pledged Collateral delivered to the Collateral Agent,
shall be invested, at the written direction of the Pledgor, by the
Collateral Agent in Cash Equivalents.
(iii) The Collateral Agent shall execute and deliver (or cause
to be executed and delivered) to the Pledgor all such proxies and other
instruments as the Pledgor may reasonably request for the purpose of
enabling the Pledgor to exercise the voting and other rights which it
is entitled to exercise pursuant to subsection (i) or (ii) above.
(b) Upon the occurrence and during the continuance of a
Default (except as provided below), at the Collateral Agent's option and
following written notice by the Collateral Agent to the Pledgor:
(i) All rights of the Pledgor to exercise the voting and other
consensual rights which it would otherwise be entitled to exercise
pursuant to Section 5(a)(i) shall cease; provided, however, that the
Pledgor shall be entitled to exercise such rights without the prior
consent of the Collateral Agent if such rights are to be exercised to
vote in favor of a transaction which is reasonably expected to cure the
Default, not result in another Default and not result in a Material
Adverse Effect (as defined herein). Except as provided in the prior
sentence, after the occurrence and during the continuance of an Event
of Default, all such voting and other consensual rights shall thereupon
become vested in the Collateral Agent, who shall thereupon have the
sole right to exercise such voting and other consensual rights, subject
to the satisfaction of any regulatory requirements. Effective upon the
occurrence and during the continuance of an Event of Default, the
Pledgor hereby appoints the Collateral Agent the Pledgor's true and
lawful attorney-in-fact and grants to the Collateral Agent an
IRREVOCABLE PROXY to vote the Pledged Collateral in any
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manner the Collateral Agent deems advisable for or against all matters
submitted or which may be submitted to a vote of shareholders. The
power-of-attorney granted hereby is coupled with an interest and shall
be irrevocable.
(ii) The provisions of Section 5(a)(ii) shall continue in full
force and effect, except that no dividends or distributions may be paid
to the Pledgor.
As used in this Agreement, the term "Material Adverse Effect"
shall mean an effect resulting from any circumstance or event of whatever nature
(including any adverse determination in any litigation) which does, or could
reasonably be expected to, materially and adversely (A) impair the validity or
enforceability of any of the Old Note Indenture, the New Note Indenture, the
Notes, the Collateral Agent's, the Old Note Trustee's, the New Note Trustee's or
any Holder's rights or remedies with respect thereto; (B) cause a Default; (C)
affect the business, property, business prospects, operations, or financial or
other condition of the Subsidiary or Pledgor; or (D) impair or affect the
Pledged Collateral or the Collateral Agent's Liens on the Pledged Collateral or
the priority of such Liens.
(c) In the event that all or any part of the securities or
instruments constituting the Pledged Collateral are lost, mutilated, destroyed
or wrongfully taken while such securities or instruments are in the possession
of the Collateral Agent, the Pledgor agrees that it will cause the delivery of
new securities or instruments in place of the lost, mutilated, destroyed or
wrongfully taken securities or instruments upon request therefor by the
Collateral Agent without the necessity of any indemnity bond or other security
other than the Collateral Agent's agreement or indemnity therefor customary for
security agreements similar to this Agreement.
6. Additional Shares. (a) The Pledgor agrees that it will
cause the Subsidiary not to issue any Stock of any kind.
(b) Without derogating from paragraph (a) of this Section 6,
in the event that, during the term of this Agreement:
(i) any stock dividend, stock split, reclassification,
readjustment, or other change is declared or made in the capital
structure of the Subsidiary, all new, substituted, and additional
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shares, or other securities, issued by reason of any such change and
received by the Pledgor (directly or indirectly) or to which the
Pledgor shall be entitled shall be promptly delivered or otherwise
transferred to the Collateral Agent, together with undated stock powers
endorsed in blank by the Pledgor, and shall thereupon constitute
additional Pledged Collateral to be held by the Collateral Agent under
the terms of this Agreement; and
(ii) any subscriptions, warrants or any other rights or
options shall be issued in connection with the Pledged Shares, all new
stock or other securities acquired through such subscriptions,
warrants, rights or options, and all additional shares of capital stock
of the Subsidiary or any successor in interest thereto from time to
time acquired by the Pledgor (directly or indirectly) in any manner
whatsoever (including, without limitation, any shares of preferred
stock issued by the Subsidiary) together with appropriate undated stock
or similar powers endorsed in blank by the Pledgor, shall be promptly
delivered or otherwise transferred to the Collateral Agent and shall
thereupon constitute Pledged Collateral to be held by the Collateral
Agent under the terms of this Agreement.
7. Payment of Taxes and Claims. The Pledgor shall make payment
of (a) all taxes, assessments, license fees, levies and other charges of
Governmental Bodies imposed upon it which if unpaid, could reasonably be
expected to have a Material Adverse Effect or become a Lien on the Property of
the Pledgor, unless and to the extent only that such taxes, assessments,
charges, license fees, levies and other charges shall be contested in good faith
and by appropriate proceedings diligently conducted by the Pledgor and the
Collateral Agent has received prompt notice of such contest, (b) all taxes,
assessments, license fees, levies and other charges of Governmental Bodies on
any of the Pledged Collateral before any penalty or interest accrues thereon,
unless and to the extent only that such taxes, assessments, charges, license
fees, levies and other charges shall be contested in good faith and by
appropriate proceedings diligently conducted by the Pledgor and the Collateral
Agent has received prompt notice of such contest, before any penalty or interest
accrues thereon, and (c) all claims (including, without limitation, claims for
labor, services, materials and supplies) for sums materially adversely affecting
the Pledged Collateral, which have become due and payable and which by law have
or may become a Lien upon any of the Pledged Collateral prior to the time when
any penalty or fine shall be incurred with respect
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thereto, unless and to the extent such claim is being contested in good faith
and by appropriate proceedings diligently conducted by the Pledgor, the
Collateral Agent has received prompt notice of such contest, any proceeding to
place a lien on the Pledged Collateral or to enforce a lien on the Pledged
Collateral has been stayed and such contest is not reasonably expected to have a
Material Adverse Effect.
8. Covenants and Agreements. The Pledgor covenants and agrees
that on and after the date hereof until the payment in full of the Secured
Obligations and the termination and discharge of both the Old Note Indenture and
the New Note Indenture, unless the Collateral Agent shall otherwise consent in
writing:
(a) At any time and from time to time, upon the reasonable
request of the Collateral Agent, and at the sole expense of the
Pledgor, the Pledgor shall promptly do, file, record, execute and
deliver any and all such further notices, instruments and documents and
will take such further action as may be reasonably deemed necessary or
desirable in the judgment of the Collateral Agent and its counsel to
obtain, protect and perfect the security interests granted hereby and
enforce and give effect to the rights, remedies and powers hereunder,
including, without limitation, the recording or filing of all
instruments and documents reasonably necessary to perfect and protect
the perfection of the security interests granted hereby under Article 8
or 9 of the Uniform Commercial Code in effect in any applicable
jurisdiction. In connection therewith, the Collateral Agent is hereby
irrevocably authorized and empowered as the Pledgor's attorney-in-fact,
solely to make, at the Collateral Agent's option, all filings and to
give all other notices as it shall reasonably deem necessary with
respect to any of the Pledged Collateral, all of which may be done with
or without the signature of the Pledgor. The Pledgor agrees that the
foregoing power constitutes a power coupled with an interest which
shall survive until the payment in full of all of the Secured
Obligations. The Pledgor agrees to reimburse the Collateral Agent on
demand for any actual and reasonable expenses (including reasonable
attorneys' fees and expenses with respect to the Collateral Agent,
including reasonable allocated costs and expenses of in-house counsel
and legal staff) incurred by the Collateral Agent in connection with
such matters and, until such reimbursement, such expenses shall be a
part of the Secured Obligations.
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(b) The Pledgor shall defend its ownership interest in and to
the Collateral and the Collateral Agent's security interest in and to
the Pledged Collateral against all claims and demands of all Persons at
any time claiming the same or any interest therein adverse to the
interests of the Collateral Agent.
(c) The Pledgor shall, at all times, maintain or cause to be
maintained accurate books and records with respect to the Pledged
Collateral, and shall furnish to the Collateral Agent such information
concerning such Pledged Collateral as the Collateral Agent may from
time to time reasonably request. The Collateral Agent and its designees
are hereby given the right, at the Pledgor's expense, to inspect and
copy, following prior notice to the Pledgor and during regular business
hours, or the Pledgor shall furnish the Collateral Agent with copies
of, all records and documents reasonably required by the Collateral
Agent relating to the Pledged Collateral.
(d) The Pledgor shall not further hypothecate, assign, pledge,
encumber, transfer, sell or otherwise dispose of, or grant any option
with respect to, or create or suffer to exist a security interest in,
or a Lien on, the Pledged Collateral or any portion thereof, except for
the pledge, assignment and security interest created by this Agreement
in favor of the Collateral Agent and except as contemplated by Article
12 of the Old Note Indenture and Article 12 of the New Note Indenture.
The inclusion of "Proceeds" of the Pledged Collateral under the
security interest granted herein shall not be deemed a consent by the
Collateral Agent to any sale or other disposition of any Pledged
Collateral except as expressly permitted herein.
(e) The Pledgor shall promptly notify the Collateral Agent of
any change occurring in or to the Pledged Collateral, of a change in
the Pledgor's mailing address, of any material change in any fact or
circumstance warranted or represented by the Pledgor in this Agreement
or furnished to the Collateral Agent, or if any Default or Event of
Default hereunder shall occur.
(f) The Pledgor shall not, without the prior written consent
of the Collateral Agent, sign or file or authorize the signing or
filing of any document, financing statement or instrument creating or
perfecting, or purporting to create or perfect, any
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Lien or other encumbrance on all or any part of its Pledged Collateral
except in favor of the Collateral Agent as required hereby and except
as contemplated in Article 12 of the Old Note Indenture and Article 12
of the New Note Indenture.
(g) The security interest granted hereby constitutes and shall
at all times constitute a perfected continuing first priority security
interest in the Pledged Collateral.
9. The Collateral Agent Appointed Attorney-in-Fact. Effective
upon the occurrence and during the continuance of an Event of Default, the
Pledgor hereby irrevocably appoints the Collateral Agent its attorney-in-fact,
with full authority in the place and stead of the Pledgor and in the name of the
Pledgor or otherwise, from time to time in the Collateral Agent's discretion, to
take any action and to execute any instrument which the Collateral Agent may
deem necessary or advisable to accomplish the purposes of this Agreement,
including, without limitation:
(a) to ask, demand, collect, sue for, recover, compromise,
receive and give acquittance and receipts for moneys due and to become
due under or in respect of any of the Pledged Collateral and/or extend
the time of payment, arrange for payment in installments, or otherwise
modify the terms of, or release, any Pledged Collateral or obligations,
without otherwise discharging or affecting the Secured Obligations, the
Pledged Collateral or the security interests granted by this Agreement,
(b) to file any claims or take any action or institute any
proceedings which the Collateral Agent may deem necessary or desirable
for the collection of any of the Pledged Collateral or otherwise to
enforce the rights of the Collateral Agent with respect to any of the
Pledged Collateral; and
(c) to receive, indorse and collect any drafts or other
instruments and documents made payable to the Pledgor in connection
with clause (a) above or representing any dividend or other
distribution in respect of the Pledged Collateral or any part thereof
and to give full discharge for the same.
The power-of-attorney granted hereby is coupled with an interest and shall be
irrevocable.
14
10. The Collateral Agent May Perform. If the Pledgor fails to
perform any agreement contained herein or make payment of any amount required
hereunder, the Collateral Agent may itself perform, or cause performance of, or
provide payment for the performance thereof, and the reasonable expenses of the
Collateral Agent incurred in connection therewith shall be payable by the
Pledgor under Section 15 of this Agreement and any such payment made shall be
deemed an advance by the Collateral Agent to the Pledgor, payable on demand
together with interest at the highest rate then payable under the Old Note
Indenture or the New Note Indenture, as applicable, or if both the Old Note
Indenture and the New Note Indenture are applicable, then at the rate which is
the greater thereof.
11. The Collateral Agent's Duties. The powers conferred on the
Collateral Agent hereunder are solely to protect its interest in the Pledged
Collateral and shall not impose any duty upon it to exercise any such powers.
Except for the safe custody of any Pledged Collateral in its possession and the
accounting for moneys actually received by it hereunder, the Collateral Agent
shall have no duty as to any Pledged Collateral, including the filing of any
financing or continuation statements relating to the Pledged Collateral. The
Collateral Agent shall be deemed to have exercised reasonable care in the
custody and preservation of the Pledged Collateral in its possession if the
Pledged Collateral is accorded treatment substantially equal to that which the
Collateral Agent accords its own Property, it being understood that the
Collateral Agent shall not be under any obligation to (a) ascertain or take
action with respect to calls, conversions, exchanges, maturities, tenders or
other matters relative to any Pledged Collateral, whether or not the Collateral
Agent has or is deemed to have knowledge of such matters, or (b) take any
necessary steps to preserve rights against prior parties or any other rights
pertaining to any Pledged Collateral, but may do so at its option, and all
reasonable expenses incurred in connection therewith shall be for the sole
account of the Pledgor, and shall be added to the Secured Obligations.
12. Events of Default. If any of the following events shall
occur, then an "Event of Default" has occurred hereunder:
(a) if the Pledgor fails to fully and punctually pay, perform
or observe any debt, obligation or liability of the Pledgor under this
Agreement, the Old Note Indenture or the New Note Indenture; or
15
(b) if any representation or warranty made herein, in the Old
Note Indenture, in the New Note Indenture or in any certificate, report
or other document furnished by the Pledgor in connection with this
Agreement, the Old Note Indenture or the New Note Indenture shall prove
to have been false in any material respect upon the date when made or
deemed to have been made or repeated; or
(c) if the Pledgor shall fail to observe or perform any term,
covenant or agreement contained in Sections 8(a), 8(d) or 8(f) of this
Agreement; or
(d) if the Pledgor shall fail to perform or observe any other
term, covenant or agreement on its part to be performed or observed
pursuant to this Agreement and such failure shall have continued
unremedied for a period of 30 days after the Pledgor shall become aware
of such failure; or
(e) the occurrence and continuance of an Event of Default
under and as defined in the Old Note Indenture or the New Note
Indenture.
13. Notice of Event of Default. The Pledgor agrees to notify
the Collateral Agent of the occurrence of an Event of Default promptly upon its
obtaining knowledge thereof.
14. Remedies. Upon the occurrence and during the continuation
of an Event of Default, the Collateral Agent may upon written instructions from
the Old Note Trustee or the New Note Trustee, as applicable, subject to
regulatory requirements and the terms and conditions of the Intercreditor
Agreement, exercise any and all remedies and other rights provided under this
Agreement and by applicable law, including, without limitation, the following:
(a) The Collateral Agent may exercise in respect of the
Pledged Collateral, in addition to other rights and remedies provided
for herein or otherwise available to it, all the rights and remedies of
a secured party upon default under the UCC (whether or not the UCC
applies to the affected Pledged Collateral) and also may without
notice, except as specified below, sell, lease, assign, grant an option
or options to purchase or otherwise dispose of the Pledged Collateral
or any part thereof in one or more parcels at public or private sale,
at any exchange, broker's board or at any of the Collateral Agent's
offices or elsewhere, for cash, on credit or for future delivery, and
upon such
16
other terms as the Collateral Agent may deem commercially reasonable.
The Pledgor agrees that, to the extent notice of sale shall be required
by law, at least 10 days' notice to the Pledgor of the time and place
of any public sale or the time after which any private sale is to be
made shall constitute reasonable notification. The Collateral Agent
shall not be obligated to make any sale of Pledged Collateral
regardless of notice of sale having been given. The Collateral Agent
may adjourn any public or private sale from time to time by
announcement at the time and place fixed therefor, and such sale may,
without further notice, be made at the time and place to which it was
so adjourned.
(b) Any cash held by the Collateral Agent as Pledged
Collateral and all cash proceeds received by the Collateral Agent in
respect of any sale of, collection from or other realization upon all
or any part of the Pledged Collateral may, in the discretion of the
Collateral Agent, be held by the Collateral Agent as Pledged Collateral
for, and then or at any time thereafter applied (after the payment of
any amounts payable to the Collateral Agent pursuant to Section 15
hereof) in whole or in part by the Collateral Agent for the ratable
benefit of the holders of the Old Notes or the New Notes, as
applicable, against all or any part of the Secured Obligations. Any
surplus of such cash or cash proceeds held by the Collateral Agent and
remaining after payment of all of the Secured Obligations shall be paid
over to the Pledgor or to whomsoever may be lawfully entitled to
receive such surplus.
(c) The Pledgor acknowledges and agrees that the Collateral
Agent may elect, with respect to the offer or sale of any or all of the
Pledged Collateral, to conduct such offer and sale in such a manner as
to avoid the need for registration or qualification of the Pledged
Collateral or the offer and sale thereof under any Federal or state
securities laws and that the Collateral Agent is authorized to comply
with any limitation or restriction in connection with such sale as
counsel may advise the Collateral Agent is necessary in order to avoid
any violation of applicable law, including, without limitation,
compliance with such procedures as may restrict the number of
prospective bidders and purchasers, require that such prospective
bidders and purchasers have certain qualifications, and restrict such
prospective bidders and purchasers to Persons who will represent and
agree that they are
17
purchasing for their own account for investment and not with a view to
the distribution or resale of such Pledged Collateral, or in order to
obtain any required approval of the sale or of the purchaser by any
Governmental Body. The Pledgor further acknowledges and agrees that any
such transaction may be at prices and on terms less favorable than
those which may be obtained through a public sale and not subject to
such restrictions and agrees that, notwithstanding the foregoing, the
Collateral Agent is under no obligation to conduct any such public sale
and may elect to impose any or all of the foregoing restrictions, or
any other restrictions which may be necessary or desirable in order to
avoid any such registration or qualification, at its sole discretion or
with the consent or direction of the parties entitled to give direction
pursuant to the Intercreditor Agreement, and that any such offer and
sale shall, taking into account the possible restrictions on such offer
and sale described in this subsection (c), be conducted in a
commercially reasonable manner.
(d) The Pledgor hereby expressly waives and covenants not to
assert any appraisement, valuation, extension, redemption or similar
laws, now or at any time hereafter in force, which might delay, prevent
or otherwise impede the performance or enforcement of this Agreement.
15. Expenses. The Pledgor will upon demand make payment to the
Collateral Agent of any and all reasonable out-of-pocket sums, costs and
expenses, which the Collateral Agent may pay or incur pursuant to the provisions
of this Agreement or in perfecting, defending, protecting or enforcing this
Agreement or the security interests granted herein or in enforcing payment of
all of the Secured Obligations or otherwise in connection with the provisions
hereof, including, but not limited to court costs, reasonable collection
charges, reasonable travel expenses, and reasonable attorneys' fees (including
with respect to the Collateral Agent, the reasonable allocated costs and
expenses of in-house counsel and legal staff) all of which together with
interest at the highest rate then payable under the Old Note Indenture or the
New Note Indenture, as applicable, or if both the Old Note Indenture and the New
Note Indenture are applicable, then the greater thereof, shall be part of the
Secured Obligations.
16. Repayment in Bankruptcy, etc. Notwithstanding anything to
the contrary contained in this Agreement, if, at any time or times subsequent to
the
18
payment of all or any part of the Secured Obligations, the Collateral Agent
shall be required to repay any amounts previously paid by or on behalf of the
Subsidiary or the Pledgor in reduction thereof by virtue of an order of any
court having jurisdiction thereof, including, without limitation, as a result of
an adjudication that such amounts constituted preferential payments or
fraudulent conveyances, the Pledgor unconditionally agrees to make payment to
the Collateral Agent within 10 days after demand of the amount of such
repayment, together with interest on such amount from the date of such repayment
by the Collateral Agent to the date of payment to the Collateral Agent at the
default interest rate set forth in the Old Note Indenture or the New Note
Indenture, as applicable, or if both the Old Note Indenture and the New Note
Indenture are applicable, then at the rate which is the greater thereof.
17. No Segregation of Moneys; No Interest. No moneys or any
other property received by the Collateral Agent hereunder need be segregated in
any manner except to the extent required by law, and any such moneys or other
property may be deposited under such general conditions as may be prescribed by
law applicable to the Collateral Agent, and the Collateral Agent shall not be
liable for any interest thereon.
18. Continuing Security Interest; Termination. (a) This
Agreement shall create a continuing perfected first security interest in the
Pledged Collateral and shall (i) remain in full force and effect until the
payment in full of all of the Secured Obligations, (ii) be binding upon the
Pledgor, its successors and assigns and (iii) inure, together with the rights
and remedies of the Collateral Agent hereunder, to the benefit of the Collateral
Agent, the Old Note Trustee and the New Note Trustee and the Holders and their
respective successors, transferees and assigns.
(b) Notwithstanding anything to the contrary in this Section
18, upon (i) satisfaction by the Old Note Trustee and the New Note Trustee of
the conditions set forth in Article Four of the Old Note Indenture and Article
Four of the New Note Indenture, upon the satisfaction and discharge of the Old
Note Indenture and the New Note Indenture, respectively, (ii) the payment in
full of all Secured Obligations or (iii) the defeasance of the Old Notes and the
Old Note Indenture as provided in Section 1302 of the Old Note Indenture, and
the defeasance of the New Notes and the New Note Indenture as provided in
Section 13.02 of the New Note Indenture, the security interests created under
this Agreement shall terminate and the Collateral Agent shall, at the request
and expense of the Pledgor, cause to
19
be assigned, transferred and delivered, against receipt but without recourse,
warranty or representation whatsoever, any remaining Pledged Collateral, to or
on the order of the Pledgor, and shall execute and deliver to the Pledgor an
instrument or instruments acknowledging the release of such Pledged Collateral
from the Lien of this Agreement.
19. Notices. All notices and other communications provided for
hereunder shall be in writing (including telegraphic, telecopy, telex or cable
communication) and mailed, telegraphed, telecopied, telexed, cabled or delivered
to it, if to the Pledgor, addressed to it at CD Radio Inc., 1221 Avenue of the
Americas, New York, New York 10020, Attention of Patrick L. Donnelly, if to the
Collateral Agent or the Old Note Trustee, at the address of the Old Note Trustee
specified in the Old Note Indenture, if to the New Note Trustee, at the address
of the New Note Trustee as specified in the New Note Indenture or as to any
party at such other address as shall be designated by such party in a written
notice to each other party. All such notices and other communications shall,
when mailed, telegraphed, telecopied, telexed or cabled, be effective when
deposited in the mails, delivered to the telegraph company, transmitted by
telecopier, confirmed by telex answerback or delivered to the cable company,
respectively.
20. Margin Regulations. The Pledgor shall take such steps as
may be necessary so that it shall comply with Regulations G, U and X (in so far
as Regulation X applies to Regulations G and U) promulgated by the Board of
Governors of the Federal Reserve System, in each case as in effect from time to
time and to the extent such Regulations are at the time applicable to the Notes
issued by the Pledgor.
21. Other Provisions. (a) Except as expressly provided in this
Agreement, the Pledgor hereby waives presentment, demand for payment, notice of
default, nonperformance and dishonor, protest and notice of protest of or in
respect of this Agreement, the Old Note Indenture, the New Note Indenture, the
Notes or the Secured Obligations, notice of acceptance of this Agreement and
reliance hereupon by the Collateral Agent and notice of any sale of collateral
security or any default of any sort.
(b) The Pledgor waives all errors or omissions of the
Collateral Agent in connection with the administration of Security Interest
created hereby and the Pledged Collateral, except errors or omissions which
constitute gross negligence or wilful misconduct.
20
(c) The Pledgor agrees that the Collateral Agent, the Old Note
Trustee, the New Note Trustee or the Holders may at any time, without notice to
or consent of the Pledgor, and without in any manner affecting the liability of
the Pledgor hereunder, amend, modify or waive any term or condition of the Old
Note Indenture and the New Note Indenture, as applicable, and the Old Notes and
the New Notes, as applicable, the Intercreditor Agreement and any of the other
respective Secured Obligations and any collateral security therefor and
otherwise deal with the Pledgor as if this Agreement did not exist.
(d) The Pledgor is not relying upon the Collateral Agent to
provide to the Pledgor any information concerning the Subsidiary, including,
without limitation, information which might have a Material Adverse Effect, and
the Pledgor has made arrangements satisfactory to the Pledgor to obtain from the
Subsidiary on a continuing basis such information concerning the Subsidiary as
the Pledgor may desire.
(e) In addition to all other rights it may have at law or
otherwise, upon the occurrence and during the continuance of an Event of
Default, the Collateral Agent is hereby authorized at any time and from time to
time, without notice, to set off against any and all obligations which the
Collateral Agent may owe to the Subsidiary or the Pledgor, of any kind or
nature, and the Pledgor shall continue to be liable to the Collateral Agent for
any deficiency with interest at the applicable interest rate set forth in the
Old Note Indenture or the Old Notes, or the New Note Indenture or the New Notes,
as applicable.
(f) Notwithstanding anything to the contrary contained in the
Old Note Indenture, the New Note Indenture or in any other agreement, instrument
or document executed by the Pledgor and delivered to the Collateral Agent, the
Collateral Agent will not take any action pursuant to any document referred to
above which would constitute or result in any assignment of any FCC license or
any change of control (whether de jure or de facto) of the Pledgor or the
Subsidiary if such assignment of any FCC license or change of control would
require, under then existing law or regulation of the FCC, the prior approval of
the FCC without first obtaining such prior approval of the FCC. Upon the
occurrence of an Event of Default or at any time thereafter during the
continuance thereof, subject to terms and conditions of this Agreement, the
Pledgor agrees to take any action which the Collateral Agent may reasonably
request in order to obtain from the FCC such approval as may be necessary to
enable the Collateral Agent to exercise and
21
enjoy, the full rights and benefits granted to the Collateral Agent by this
Agreement and the other documents referred to above, including specifically, at
the cost and expense of the Pledgor, the use of its best efforts to assist in
obtaining approval of the FCC for any action or transaction contemplated by this
Agreement for which such approval is or shall be required by law, and
specifically, without limitation, upon request, to prepare, sign and file with
the FCC the assignor's or transferor's portion of any application or
applications for consent to the assignment of license or transfer of control
necessary or appropriate under the FCC's rules and regulations for approval of
(i) any sale or other disposition of the Pledged Collateral by or on behalf of
the Collateral Agent, or (ii) any assumption by the Collateral Agent of voting
rights in the Pledged Collateral effected in accordance with the terms of this
Agreement. It is understood and agreed that all foreclosure and related actions
will be made in accordance with the Communications Act of 1934, as amended, and
the rules and regulations promulgated thereunder, as from time to time in effect
(the "Communications Act") and other applicable FCC regulations and published
policies and decisions.
(g) The Pledgor agrees to indemnify and hold harmless the
Collateral Agent, the Old Note Trustee, the New Note Trustee, and the Holders,
the respective affiliates of the Collateral Agent, the Old Note Trustee, the New
Note Trustee, and the Holders, and the respective officers, directors,
employees, agents (including, without limitation each of their counsel), and
controlling persons of the Collateral Agent, the Old Note Trustee, the New Note
Trustee, and the Holders and each such affiliate (each, an "Indemnified Party")
from and against any and all claims, actions and suits whether groundless or
otherwise, and from and against any and all liabilities, losses, damages and
costs and expenses (including, without limitation, the reasonable fees and
disbursements of counsel and with respect to the Collateral Agent, reasonably
allocated costs and expenses of in-house counsel and legal staff) of every
nature and character arising out of or in connection with any actual or
threatened claim, litigation, investigation or proceeding relating to the Old
Note Indenture, the New Note Indenture, the Notes or this Agreement or the
transactions contemplated hereby (other than any such actions or expenses
resulting from the gross negligence or wilful misconduct of the Collateral
Agent, the Old Note Trustee, the New Note Trustee or the Holders), in each case
including, without limitation, the reasonable fees and disbursements of counsel
and allocated costs of in-house counsel and legal staff incurred in connection
with any such investigation,
22
litigation or other proceeding whether or not such Indemnified Party is a party
thereto, and the Pledgor agrees to reimburse each Indemnified Party, upon
demand, for all out-of-pocket costs and expenses (including, without limitation,
the reasonable fees and disbursements of counsel and with respect to the
Collateral Agent, reasonably allocated costs and expenses of in-house counsel
and legal staff) incurred in connection with any of the foregoing. In
litigation, or the preparation therefor, the Collateral Agent, the Old Note
Trustee and the New Note Trustee shall be entitled to select their own counsel
and, in addition to the foregoing indemnity, the Pledgor agrees to pay promptly
the reasonable fees and expenses of such counsel. If, and to the extent that the
obligations of the Pledgor under this Section 21(g) are unenforceable for any
reason, the Pledgor hereby agrees to make the maximum contribution to the
payment in satisfaction of such obligations which is permissible under
applicable law.
The Pledgor shall not make any claim against any Indemnified
Party for any special, indirect or consequential damages in respect of any
breach or wrongful conduct (whether the claim therefor is based in contract,
tort or duty imposed by law) in connection with, arising out of or in any way
related to the transactions contemplated by, and the relationship established by
this Agreement, the Old Note Indenture, the New Note Indenture, the Notes, or
any act, omission or event occurring in connection therewith, and the Pledgor
hereby waives, releases and agrees not to sue upon any such claim for any such
damages, whether or not accrued and whether or not known or suspected to exist
in the Pledgor's favor.
The covenants contained in this Section 21(g) shall survive
payment or satisfaction in full of all other of the Secured Obligations.
(h) The Pledgor hereby appoints Patrick L. Donnelly, 1221
Avenue of the Americas, New York, New York 10020, as its legally authorized
process agent to accept service on behalf of the Pledgor.
(i) This Agreement shall be governed by, and construed in
accordance with, the laws of the State of New York. The Pledgor agrees that any
suit for the enforcement of this Agreement may be brought in the courts of the
State of New York or any Federal court sitting therein and consents to the
nonexclusive jurisdiction of such court and service of process in any such suit
being made upon the Pledgor by mail to Patrick L. Donnelly at the address
specified in Section 21(h). The Pledgor hereby waives any
23
objection that it may now or hereafter have to the venue of any such suit or any
such court or that such suit is brought in an inconvenient court.
(j) This Agreement and any amendment hereof may be executed in
several counterparts and by each party on a separate counterpart, each of which
when so executed and delivered shall be an original, and all of which together
shall constitute one instrument. In proving this Agreement it shall not be
necessary to produce or account for more than one such counterpart signed by the
party against whom enforcement is sought.
(k) This Agreement and any other documents executed in
connection herewith express the entire understanding of the parties with respect
to the transactions contemplated hereby. Neither this Agreement nor any term
hereof may be changed, waived, discharged or terminated, except as provided in
Section 21(m).
(l) Each Holder, by its acceptance of the benefits of this
Agreement and the security interest created hereby, is deemed to agree to be
subject to the provisions of the Intercreditor Agreement.
(m) The Pledgor hereby waives its right to a jury trial with
respect to any action or claim arising out of any dispute in connection with
this Agreement, or any of the other loan documents, any rights or obligations
hereunder or thereunder or the performance of such rights and obligations.
Except as prohibited by law, the Pledgor hereby waives any right it may have to
claim or recover in any litigation referred to in the preceding sentence any
special, exemplary, punitive or consequential damages or any damages other than,
or in addition to, actual damages. The Pledgor (i) certifies that no agent or
representative of the Collateral Agent, the Old Note Trustee, the New Note
Trustee or any Holder has represented, expressly or otherwise, that the
Collateral Agent, the Old Note Trustee, the New Note Trustee or such Holder, as
the case may be, would not, in the event of litigation, seek to enforce the
foregoing waivers and (ii) acknowledges that the Old Note Trustee, the New Note
Trustee and the Collateral Agent have been induced to enter into this Agreement,
the Old Note Indenture and the New Note Indenture by, among other things, the
waivers and certifications contained herein.
(n) Any consent or approval required or permitted by this
Agreement to be given by the Collateral Agent may be given with, but only with,
the written consent of the Collateral Agent (subject to the terms of the
Intercreditor
24
Agreement). Any term of this Agreement may be amended, and the performance or
observance by the Pledgor of any terms of this Agreement, or the continuance of
any Default or Event of Default may be waived (either generally or in a
particular instance and either retroactively or prospectively) with, but only
with, the written consent of the Pledgor, the written consent of the Collateral
Agent, the written consent of the Old Note Trustee and the written consent of
the New Note Trustee. No waiver shall extend to or affect any obligation not
expressly waived or impair any right consequent thereon. No course of dealing or
delay or omission on the part of the Collateral Agent, the Old Note Trustee, the
New Note Trustee or any Holder in exercising any right shall operate as a waiver
thereof or otherwise be prejudicial thereto. No notice to or demand upon the
Pledgor shall entitle the Pledgor to other or further notice or demand in
similar or other circumstances.
(o) Notwithstanding the foregoing, this Agreement may be
amended, revised and supplemented, as contemplated by Section 1203 of the Old
Note Indenture and Section 12.03 of the New Note Indenture, to assign and pledge
to the Collateral Agent for the benefit of the Holders and the equal and ratable
benefit of the Secured Parties (as defined in the Old Note Indenture and in the
New Note Indenture) a security interest in the Pledged Collateral. Any such
amendment, revision or supplement shall comply with the provisions of Section
1203 of the Old Note Indenture and Section 12.03 of the New Note Indenture.
(p) The Pledgor hereby waives any and all rights against
immunity from jurisdiction, attachment (both before and after judgment) and
execution to which it might be entitled.
(q) The provisions of this Agreement are severable and if any
one clause or provision hereof shall be held invalid or unenforceable in whole
or in part in any jurisdiction, then such invalidity or unenforceability shall
affect only such clause or provision, or part thereof, in such jurisdiction, and
shall not in any manner affect such clause or provision in any other
jurisdiction, or any other clause or provision of this Agreement in any
jurisdiction.
25
(r) The Collateral Agent shall not be required to exercise any
of the rights or powers vested in it by this Agreement, unless it shall have
received reasonable indemnity against costs, expenses and liabilities which may
be incurred in connection therewith. Any permissive right of the Collateral
Agent to act hereunder shall not be construed as a duty.
IN WITNESS WHEREOF, the Pledgor has caused this Agreement to
be duly executed and delivered as of the date hereof.
CD RADIO INC.,
by: /s/Patrick L. Donnelly
--------------------------
Name: Patrick L. Donnelly
Title: Executive Vice
President & General
Counsel
Accepted and agreed to:
IBJ WHITEHALL BANK AND TRUST COMPANY,
as Collateral Agent,
by: /s/Luis Perez
--------------------------
Name: Luis Perez
Title: Assistant Vice President
IBJ WHITEHALL BANK AND TRUST COMPANY,
as Old Note Trustee,
by: /s/Luis Perez
--------------------------
Name: Luis Perez
Title: Assistant Vice President
UNITED STATES TRUST COMPANY OF NEW YORK,
as New Note Trustee,
by: /s/Patricia Gallagher
--------------------------
Name: Patricia Gallagher
Title: Assistant Vice President
26
Schedule I
Pledged Shares
All issued and outstanding shares of capital stock of Satellite CD Radio, Inc.,
a Delaware corporation.