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Exhibit 10.1
OMNIBUS AGREEMENT entered into as of the 1st day of January, 2000
BY AND AMONG: ORBITAL SCIENCES CORPORATION, a corporation
governed by the laws of Delaware ("ORBITAL");
AND: ORBITAL COMMUNICATIONS CORPORATION, a corporation
governed by the laws of Delaware ("OCC") owned
98.65% by Orbital;
AND: TELEGLOBE INC., a corporation governed by the laws
of Canada ("TELEGLOBE");
AND: TELEGLOBE MOBILE PARTNERS, a Delaware general
partnership ("TELEGLOBE MOBILE") indirectly owned
100% by Teleglobe;
AND: ORBCOMM GLOBAL, L.P., a Delaware limited partnership
("ORBCOMM") owned by OCC and Teleglobe Mobile;
(OCC and Teleglobe Mobile are collectively referred
to herein as the "PARTNERS", and Orbital, Teleglobe,
the Partners, and ORBCOMM are collectively referred
to herein as the "PARTIES")
ORBCOMM
WHEREAS ORBCOMM was organized by the filing on June 30, 1993 of a Certificate of
Limited Partnership with the Secretary of State of the State of Delaware;
WHEREAS the Partners, Orbital, and Teleglobe have executed a Restated Master
Agreement dated as of September 12, 1995, as amended as of February 5, 1997 (the
"MASTER AGREEMENT");
WHEREAS the Partners have executed, both as general and limited partners, a
Restated Agreement of Limited Partnership of ORBCOMM Global, L.P. dated as of
September 12, 1995, as amended as of December 2, 1996 (the "PARTNERSHIP
AGREEMENT");
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MARKETING PARTNERSHIPS
WHEREAS each of ORBCOMM USA, L.P. ("ORBCOMM USA") and ORBCOMM International
Partners, L.P. ("ORBCOMM INTERNATIONAL") was organized by the filing on June 30,
1993 of a Certificate of Limited Partnership with the Secretary of State of the
State of Delaware;
WHEREAS ORBCOMM and OCC have executed, both as general and limited partners, a
Restated Agreement of Limited Partnership of ORBCOMM USA, L.P. dated as of
September 12, 1995 (the "USA PARTNERSHIP AGREEMENT"), and ORBCOMM and Teleglobe
Mobile have executed, both as general and limited partners, a Restated Agreement
of Limited Partnership of ORBCOMM International Partners, L.P. dated as of
September 12, 1995 (the "INTERNATIONAL PARTNERSHIP AGREEMENT");
WHEREAS OCC and ORBCOMM USA have executed a Restated System Charge Agreement
dated as of September 12, 1995 (the "USA SYSTEM CHARGE AGREEMENT"), and
Teleglobe Mobile, ORBCOMM and ORBCOMM International have executed a Restated
International System Charge Agreement dated as of September 12, 1995 (the
"INTERNATIONAL SYSTEM CHARGE AGREEMENT") (the USA System Charge Agreement and
the International System Charge Agreement are collectively referred to herein as
the "SYSTEM CHARGE Agreements");
OTHER ENTITIES
WHEREAS Orbital was engaged in, and holds title to assets relating to, the
business of, among other things, developing, designing, manufacturing, marketing
and selling to commercial customers automated tracking and cargo status data
systems of unpowered mobile assets such as truck trailers, railcars and
containers (the "GEMTRAK BUSINESS");
WHEREAS Teleglobe owns 3,600 Class A voting shares in the share capital of
ORBCOMM Canada Inc., a Canadian corporation ("ORBCOMM CANADA") representing
ninety-two point five percent (92.5%) of the issued and outstanding voting
shares in the share capital of ORBCOMM Canada;
OTHER AGREEMENTS AND LICENSES
WHEREAS ORBCOMM and Orbital have executed an ORBCOMM System Procurement
Agreement dated as of September 12, 1995, as amended (the "1995 PROCUREMENT
AGREEMENT") and an ORBCOMM Procurement Agreement dated as of February 1, 1999,
as amended (the "1999 PROCUREMENT AGREEMENT") (the 1995 Procurement Agreement
and the 1999 Procurement Agreement are collectively referred to herein as the
"PROCUREMENT AGREEMENTS");
WHEREAS the Federal Communications Commission (the "FCC") granted various
licenses to OCC for the construction, launch and operation of a total of 48
low-earth orbit satellites to
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provide two-way data and messaging communications and position determination
services, and for the operation of four gateway Earth stations and the
deployment of up to 200,000 subscriber units in the continental United States
(the "FCC LICENSES");
WHEREAS ORBCOMM and Orbital have executed an Amended and Restated Administrative
Services Agreement dated as of January 1, 1997 (the "ADMINISTRATIVE SERVICES
AGREEMENT");
PURPOSE
WHEREAS, the Parties wish to amend certain agreements with respect to ORBCOMM
and conclude certain other transactions described herein;
NOW, THEREFORE, IN CONSIDERATION OF THE FOREGOING AND THE RESPECTIVE
REPRESENTATIONS, WARRANTIES, COVENANTS AND AGREEMENTS HEREIN CONTAINED AND OTHER
GOOD AND VALUABLE CONSIDERATION, AND INTENDING TO BE LEGALLY BOUND HEREBY, THE
PARTIES AGREE AS FOLLOWS:
ARTICLE 1
INTERPRETATION
1.1 DEFINITIONS. In this Agreement unless specifically defined otherwise or
the context otherwise requires, the following terms shall have the
following meanings, and the terms defined elsewhere herein shall have the
meanings there defined:
(a) "AGREEMENT" means this Omnibus Agreement and all amendments and
supplements hereto and the terms "herein", "hereof", "hereto",
"hereunder", and like terms refer to this Agreement.
(b) "BETTER OFFER" has the meaning ascribed thereto in Article 5.1
hereof.
(c) "BUSINESS COMBINATION" has the meaning ascribed thereto in Article
5.1(ii) hereof.
(d) "BUSINESS DAY" means any day excluding Saturday, Sunday and any
other day which in Washington, D.C. or Montreal, Quebec is a legal
holiday or a day on which financial institutions are authorized by
law or by local proclamation to close.
(e) "CHANGE OF CONTROL" has the meaning ascribed thereto in Article
5.1 hereof.
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(f) "CLOSING" means completion of the transactions described in
Article 9 hereof, to take place at the offices of ORBCOMM.
(g) "CLOSING DATE" means the date the Partners may agree upon as the
time at which the Closing shall take place, which shall be a date
no later than February 25, 2000.
(h) "COMMUNICATIONS ACT" means the Communications Act of 1934, as
amended, and the rules and regulations promulgated thereunder.
(i) "CONTINUING DIRECTORS" has the meaning ascribed thereto in Article
5.1 hereof.
(j) "CONVERSION NOTICE OF EXERCISE" has the meaning ascribed thereto
in Article 3.7 hereof.
(k) "CONVERSION OPTION" has the meaning ascribed thereto in Article
3.7 hereof.
(l) "DEFINITIVE AGREEMENTS" means this Agreement, the Partnership
Agreement, the Master Agreement, the Procurement Agreements, the
ORBCOMM System Construction Agreement dated as of June 30, 1993
between OCC and ORBCOMM, the Proprietary Information and
Non-Competition Agreement dated as of June 30, 1993 among the
Parties, ORBCOMM USA, L.P. and ORBCOMM International Partners,
L.P., and other agreements entered into pursuant to the terms of
this Agreement, as such agreements may have been amended or
restated or may be amended or restated in the future.
(m) "DELAYED INVOICE" has the meaning ascribed thereto in Article 3.6
hereof.
(n) "DELAYED NON-INVOICED AMOUNTS" has the meaning ascribed thereto in
Article 3.6 hereof.
(o) "EXISTING NON-INVOICED AMOUNTS" has the meaning ascribed thereto
in Article 3.1 hereof.
(p) "FIRST EXISTING INVOICE" has the meaning ascribed thereto in
Article 3.2.1 hereof.
(q) "GEMTRAK FINANCIAL STATEMENT" has the meaning ascribed thereto in
Article 10.1.8 hereof.
(r) "GEMTRAK PURCHASE PRICE" has the meaning ascribed thereto in
Article 6.2 hereof.
(s) "INDEMNIFIED PARTIES" has the meaning ascribed thereto in Article
11.2 hereof.
(t) "INDEMNIFYING PARTY" has the meaning ascribed thereto in Article
11.2 hereof.
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(u) "INDENTURE" means the Amended and Restated Indenture dated as of
February 9, 1999 executed among ORBCOMM, ORBCOMM Global Capital
Corp., OCC, Teleglobe Mobile, ORBCOMM USA, ORBCOMM International
and Marine Midland Bank.
(v) "MERGER" has the meaning ascribed thereto in Article 8.2 hereof.
(w) "ORBCOMM CANADA FINANCIAL STATEMENTS" has the meaning ascribed
thereto in Article 10.2.7 hereof.
(x) "ORBCOMM CANADA PURCHASE PRICE" has the meaning ascribed thereto
in Article 7.2 hereof.
(y) "PARTICIPATION PERCENTAGE" shall have the meaning ascribed thereto
in the Partnership Agreement, the USA Partnership Agreement or the
International Partnership Agreement, as applicable.
(z) "PARTNERSHIP INTERESTS" shall have the meaning ascribed thereto in
the Partnership Agreement, the USA Partnership Agreement or the
International Partnership Agreement, as applicable.
(aa) "PENDING INVOICE" has the meaning ascribed thereto in Article
3.5.1 hereof.
(bb) "PENDING NON-INVOICED AMOUNTS" has the meaning ascribed thereto in
Article 3.4 hereof.
(cc) "PERSON" means any individual, partnership, joint venture,
corporation, trust, unincorporated organization, association,
government or department or agency of a government or other
entity.
(dd) "PLAN A INCENTIVE FEES" has the meaning ascribed thereto in
Article 3.4 hereof.
(ee) "SECOND EXISTING INVOICE" has the meaning ascribed thereto in
Article 3.3.1 hereof.
(ff) "STEEPLECHASE LEASE" has the meaning ascribed thereto in Article
8.5 hereof.
(gg) "TELECOM BETTER OFFER" has the meaning ascribed thereto in Article
5.2 hereof.
(hh) "TELEGLOBE PROMISSORY NOTES" means, collectively, the following
promissory notes:
(i) an amended and restated unsecured promissory note dated
December 31, 1998 pursuant to which Orbital promised to pay
in a single payment and in full to the order of Teleglobe
Investment Corporation or assigns on December 31, 1999 the
principal amount of $18,612,227 together with (A) interest
in the amount of $2,103,087, and (B) interest accrued on
the unpaid principal amount from
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December 31, 1998 until such principal amount is paid in
full at a rate per annum (computed on the basis of a
360-day year comprised of twelve 30-day months) equal to
9%; which principal amount and interest equal
$22,390,414.43 as of December 31, 1999;
(ii) an amended and restated unsecured promissory note dated
December 31, 1998 pursuant to which Orbital promised to pay
in a single payment and in full to the order of Teleglobe
Holding Corporation or assigns on December 31, 1999 the
principal amount of $3,298,844 together with (A) interest
in the amount of $372,752, and (B) interest accrued on the
unpaid principal amount from December 31, 1998 until such
principal amount is paid in full at a rate per annum
(computed on the basis of a 360-day year comprised of
twelve 30-day months) equal to 9%; which principal amount
and interest equal $3,968,491.96 as of December 31, 1999;
and
(iii) an amended and restated unsecured promissory note dated
August 17, 1999 pursuant to which Orbital promised to pay
in a single payment and in full to the order of Teleglobe
Investment Corp. or assigns on December 31, 1999 the
principal amount of $6,506,401 together with interest
accrued on the unpaid principal amount from August 17, 1999
until such principal amount is paid in full at a rate per
annum (computed on the basis of a 360-day year comprised of
twelve 30-day months) equal to 9%; which principal amount
and interest equal $6,722,738.83 as of December 31, 1999.
1.2 EXTENDED MEANINGS. Words importing the singular number include the plural
and vice versa and words importing the masculine gender include the
feminine and neuter genders and vice versa.
1.3 INTERPRETATION NOT AFFECTED BY HEADINGS. The division of this Agreement
into articles and sections and insertion of headings is for convenience
and reference only and shall not affect the construction or
interpretation of this Agreement.
1.4 APPLICABLE LAW. This Agreement shall be deemed to have been made in and
shall be interpreted in accordance with and be governed by the laws of
the State of Delaware.
1.5 FUNDS. All dollar amounts referred to in this Agreement are in lawful
currency of the United States of America.
1.6 SEVERABILITY. If any provision of this Agreement shall be held invalid,
illegal or unenforceable in any jurisdiction, such invalidity, illegality
or unenforceability shall attach only to such provision in such
jurisdiction and shall not in any manner affect or render invalid,
illegal or unenforceable such provision in any other jurisdiction or any
other provision of this Agreement in any jurisdiction. Upon such
determination that any provision is invalid, illegal or unenforceable,
the Parties shall negotiate in good faith to modify this Agreement so as
to effect the original intent of the Parties as closely as possible
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in an acceptable manner in order that the transactions contemplated
hereby are consummated as originally contemplated to the greatest extent
possible. Any provision of this Agreement held invalid, illegal or
unenforceable only in part, degree or certain jurisdictions will remain
in full force and effect to the extent not held invalid, illegal or
unenforceable. To the extent permitted by applicable law, each Party
waives any provision of law that renders any provision of this Agreement
invalid, illegal or unenforceable in any respect.
1.7 NON-BUSINESS DAY. In the event that any action to be taken hereunder
falls on a day which is not a Business Day, then such action shall be
taken on the next succeeding Business Day.
1.8 PREAMBLE. The preamble forms an integral part of this Agreement.
ARTICLE 2
AMENDMENTS TO THE PARTNERSHIP AGREEMENT
The Parties agree that the Partnership Agreement shall be amended and
restated effective as of the date hereof, to reflect the following:
2.1 OCC AS LIMITED PARTNER. From the date hereof, OCC shall no longer be a
General Partner (as defined in the Partnership Agreement) and shall
become solely a Limited Partner (as defined in the Partnership
Agreement). Accordingly, any and all references in the Partnership
Agreement to "the General Partners", "any General Partners", "any General
Partner", "each of the General Partners" or "each General Partner" shall
be deleted and replaced by "the General Partner".
2.2 PARTNERSHIP AGREEMENT. The first four paragraphs of the Partnership
Agreement are hereby deleted in their entirety and replaced by the
following:
"THIS AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP (the
"Agreement") of ORBCOMM GLOBAL, L.P. (the "Partnership") is made
and entered into as of January 1, 2000 by and between TELEGLOBE
MOBILE PARTNERS, a Delaware general partnership ("Teleglobe
Mobile"), as general partner (the "General Partner"), and ORBITAL
COMMUNICATIONS CORPORATION, a Delaware corporation ("OCC"), and
Teleglobe Mobile as limited partners (the "Limited Partners"). The
General Partner and the Limited Partners are collectively referred
to herein as the "Partners". This Agreement amends and restates
the Restated Agreement of Limited Partnership of ORBCOMM Global,
L.P. dated September 15, 1995, as amended by Amendment No. 1 to
Restated Agreement of Limited Partnership of ORBCOMM Global, L.P.
dated as of December 2, 1996 (the "1995 Agreement") and by the
Omnibus Agreement dated as of January 1, 2000 entered into among
the Partners, Orbital
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Sciences Corporation, a Delaware corporation ("Orbital"), and
Teleglobe Inc., a Canadian corporation ("Teleglobe"), and the
Partnership (the "Omnibus Agreement").
WHEREAS, the Partnership was organized, in accordance with the
provisions of the Delaware Act (as hereinafter defined), by the
filing of a Certificate of Limited Partnership with the Secretary
of State of the State of Delaware (the "Certificate") pursuant to
Section 17-201 of the Delaware Act;
WHEREAS, upon the filing of the Certificate, the Partners entered
into an Agreement of Limited Partnership dated as of June 30, 1993
(the "Original Agreement") and the Partnership entered into
agreements with OCC, Orbital and Teleglobe for the development,
construction, operation and marketing of the ORBCOMM System (as
hereinafter defined); and
WHEREAS, pursuant to the terms of the Omnibus Agreement, the
Partners revised the terms of the 1995 Agreement setting forth
their agreements with respect to the conduct of the business of
the Partnership and each of their rights and obligations as
Partners."
2.3 OCC. All references to "ORBCOMM" in the Partnership Agreement (unless
followed immediately by "Global" "USA", "International" or "System") are
hereby deleted and replaced by "OCC".
2.4 SECTION 1.4. The first sentence of Section 1.4 of the Partnership
Agreement is hereby deleted and replaced by the following:
"The location of the principal office of the Partnership shall be
2455 Horse Pen Road, Herndon, Virginia 20171 or at such other
location as may be selected from time to time by the General
Partner, subject to Article 8.5 of the Omnibus Agreement."
2.5 SECTION 2.3A. A new Section 2.3A is hereby added to the Partnership
Agreement and shall read as follows:
"2.3A. Business Day. "Business Day" means any day excluding
Saturday, Sunday and any other day which in Washington, D.C. or
Montreal, Quebec is a legal holiday or a day on which financial
institutions are authorized by law or by local proclamation to
close."
2.6 SECTION 2.5. Section 2.5 of the Partnership Agreement is hereby deleted
in its entirety.
2.7 SECTION 2.8. Section 2.8 of the Partnership Agreement is hereby deleted
in its entirety.
2.8 SECTION 2.9. Section 2.9 of the Partnership Agreement is hereby deleted
in its entirety.
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2.9 SECTION 2.9A. A new Section 2.9A is hereby added to the Partnership
Agreement and shall read as follows:
"2.9A. Definitive Agreements. "Definitive Agreements" means this
Agreement, the Omnibus Agreement, the Master Agreement, the
ORBCOMM System Procurement Agreement dated as of September 12,
1995 entered into between the Partnership and Orbital, the ORBCOMM
Procurement Agreement dated as of February 1, 1999 entered into
between the Partnership and Orbital, the ORBCOMM System
Construction Agreement, the Proprietary Information and
Non-Competition Agreement, and other agreements entered into
pursuant to the terms of the Omnibus Agreement, as such agreements
may have been amended or restated or may be amended or restated in
the future."
2.10 SECTION 2.15. Section 2.15 of the Partnership Agreement is hereby deleted
in its entirety.
2.11 SECTION 2.17. Section 2.17 of the Partnership Agreement is hereby deleted
in its entirety.
2.12 SECTION 2.20. Section 2.20 of the Partnership Agreement is hereby deleted
in its entirety.
2.13 SECTION 2.20A. A new Section 2.20A is hereby added to the Partnership
Agreement and shall read as follows:
"2.20A. Omnibus Agreement. "Omnibus Agreement" shall have the
meaning ascribed to such term in the recitals hereto."
2.14 SECTION 2.28. Section 2.28 of the Partnership Agreement is hereby deleted
in its entirety and replaced by the following:
"2.28. Restatement Date. "Restatement Date" means January 1,
2000."
2.15 SECTION 2.30. Section 2.30 of the Partnership Agreement is hereby deleted
in its entirety.
2.16 SECTION 2.35. Section 2.35 of the Partnership Agreement is hereby deleted
in its entirety.
2.17 SECTION 3.1. Section 3.1 of the Partnership Agreement is hereby deleted
in its entirety and replaced by the following:
"3.1. Partnership Interests. The Partnership Interests shall be
expressed in terms of the Partners' Participation Percentages.
Teleglobe Mobile's Participation Percentage shall be sixty-four
point twenty-six percent (64.26%) and OCC's Participation
Percentage shall be thirty-five point seventy-four percent
(35.74%) as of the Restatement Date after giving effect to the
contribution described in Subsection 3.2.2 of the Omnibus
Agreement, subject to adjustments thereafter pursuant to Section
3.7 hereof (such further adjustments to include, without
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limitation, the adjustment resulting from the contribution
described in Subsection 3.5.2 of the Omnibus Agreement). The
Partners shall be entitled to receive the distributions set forth
in Sections 4 and 10."
2.18 SECTION 3.2. Section 3.2 of the Partnership Agreement is hereby deleted
in its entirety.
2.19 SECTION 3.3. Section 3.3 of the Partnership Agreement is hereby deleted
in its entirety.
2.20 SECTION 3.5. Section 3.5 of the Partnership Agreement is hereby deleted
in its entirety.
2.21 SECTION 3.6. Section 3.6 of the Partnership Agreement is hereby deleted
in its entirety and replaced by the following:
"3.6. Loans. (a) Optional Loans. The General Partner shall have
the right to make a loan of cash to the Partnership at any time on
such terms as the General Partner may determine; provided,
however, that in no event shall any such optional loan be secured
by Partnership assets, bear interest or original issue discount or
be with recourse to any Partner.
(b) Stock Option Plan Loans. To the extent (i) the Partnership has
agreed to reimburse OCC for the costs paid by OCC pursuant to
Section 6.06 of the Orbital Communications Corporation 1992 Stock
Option Plan (including the payment by OCC of withholding taxes
with respect to the exercise of stock options) in purchasing stock
acquired by employees or former employees of the Partnership (the
"Stock Option Plan Costs"), and (ii) the Partnership is permitted
to reimburse OCC for the Stock Option Plan Costs under the terms
of the Indenture, the Partnership shall pay to OCC the Stock
Option Plan Costs including, without limitation, amounts owed
under notes payable by OCC to former employees of the
Partnership."
2.22 SECTION 3.7. Section 3.7 of the Partnership Agreement is hereby deleted
in its entirety and replaced by the following:
"3.7. Additional Capital Contributions. If the Partnership shall
require a capital contribution, the Partnership shall so notify
the Partners and each Partner shall have the opportunity, but not
the obligation, to contribute in cash or immediately available
funds an amount equal to such capital contribution multiplied by
such Partner's Participation Percentage. If either Partner
declines to make a contribution within five (5) Business Days of
the date upon which the Partnership notified the Partners of such
requirement (it being understood that if a Partner has not
contributed its share at the expiration of such five (5) Business
Day-period, it will be deemed to have declined to contribute),
then:
(a) The other Partner shall be entitled to contribute the
amount so declined to be contributed (in addition to any
amount such Partner is entitled to contribute
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pursuant to the preceding sentence) within five (5)
Business Days of the date upon which the other Partner
declined or was deemed to have declined to contribute its
share, and
(b) Based on contributions so made, the Partners' Participation
Percentages shall be adjusted immediately following the
expiration of the five (5) Business Day-period referred to
in subsection (a) above as follows:
(i) Teleglobe Mobile's Participation Percentage shall be
adjusted so as to equal the percentage equal to the
result of the following formula, rounded to the
second decimal point:
299.354M + (TMAC X 1.75)
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$465.841M + [1.75 X (TMAC + OAC)] + (OCONV X $33.082M)
Where:
M = million
TMAC = the dollar amount expressed in millions
rounded to the third decimal point of all
contributions made by Teleglobe Mobile from
January 1, 2000 to the date of determination
of the Partners' Participation Percentages as
provided in this Section 3.7(b), excluding
the contribution referred to in Subsection
3.2.2 of the Omnibus Agreement.
OAC = the dollar amount expressed in millions
rounded to the third decimal point of all
contributions made by OCC from January 1,
2000 to the date of determination of the
Partners' Participation Percentages as
provided in this Section 3.7(b), excluding
the contribution resulting from the
conversion referred to in Subsection 3.3.3 of
the Omnibus Agreement.
OCONV = zero (0) until the conversion referred to in
Subsection 3.3.3 of the Omnibus Agreement is
effected and one (1) thereafter or, if such
conversion is not effected as provided in
such Subsection 3.3.3, then zero (0)
thereafter.
(ii) OCC's Participation Percentage shall be adjusted so
as to equal one hundred per cent (100%) minus
Teleglobe Mobile's Participation Percentage (so
adjusted)."
2.23 SECTION 4.1. Section 4.1 of the Partnership Agreement is hereby deleted
in its entirety and replaced by the following:
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"4.1. Distributions. Subject to Sections 4.2, 4.3 and 10.3, the
amount and timing of distributions by the Partnership, either in
cash or property, shall be determined in the discretion of the
General Partner, provided, however, subject to Sections 4.4 and
10.3, that all distributions (including, without limitation, those
made pursuant to Section 4.2) shall be made to the Partners pro
rata in accordance with their respective Participation Percentages
as of the date of distribution and that if the General Partner
determines to effect a distribution both in cash and property,
equal proportions of such cash and property shall be distributed
to the Partners pro rata in accordance with their respective
Participation Percentages as of the date of distribution. The
Partners confirm that no distributions under this Section 4.1
occurred prior to January 1, 2000."
2.24 SECTION 4.3. Section 4.3 of the Partnership Agreement is hereby deleted
in its entirety and replaced by the following:
"4.3. Nature of Distributions. The General Partner may determine
to make a distribution in kind or property to the Partners, but
such property shall be distributed in such a fashion as to ensure
that the fair value thereof is distributed and allocated in
accordance with Sections 4, 5 and 10 hereof. For purposes of (a)
determining amounts to be distributed to Partners under Section
4.1, (b) determining Net Income and Net Loss under Section 5, (c)
making adjustments to Capital Accounts under Section 5, and (d)
allocations under Section 5, any property to be distributed in
kind shall have the fair value assigned to such property by the
General Partner, subject to the approval of OCC which shall not be
unreasonably withheld or delayed, provided, however, that such
approval shall not be required (a) if at the time such fair value
is determined OCC's Participation Percentage is below 31.67%; or
(b) if such fair value is determined by a major investment banking
firm selected by the Partnership which shall not have rendered
financial advisory services to the Partnership, Teleglobe or
Orbital during the preceding year."
2.25 SECTION 5.1(d). Subsection (d) of Section 5.1 of the Partnership
Agreement is hereby deleted in its entirety and replaced by the
following:
"(d) Adjustments to Carrying Values and Capital Accounts. In
accordance with Treasury Regulations Section 1.704-1(b)(2)(iv)(f),
in connection with either (i) the contribution of money or other
property (other than a de minimis amount) to the Partnership by a
new or existing Partner in consideration for an interest in the
Partnership or (ii) a distribution of money or other property
(other than a de minimis amount) by the Partnership to a retiring
or continuing Partner as consideration for an interest in the
Partnership, the Capital Accounts of all Partners and the Carrying
Values of all Partnership properties may be, as determined by the
General Partner, adjusted (consistent with the provisions hereof)
upwards or downwards to reflect any Unrealized Gain or Unrealized
Loss attributable to each Partnership property, as if such
Unrealized Gain or Unrealized Loss had been
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recognized upon an actual sale of each such property at such time
and had been allocated to the Partners pursuant to Section 5.2.
For purposes of determining such Unrealized Gain or Unrealized
Loss, the fair value of Partnership assets shall be determined by
the General Partner using such reasonable methods of valuation as
it in its sole discretion deems appropriate, subject to the
approval of OCC which shall not be unreasonably withheld or
delayed, provided, however, that such approval shall not be
required (i) once OCC's Participation Percentage falls below 15%;
or (ii) if such fair value is determined by a major investment
banking firm selected by the Partnership which shall not have
rendered financial advisory services to the Partnership, Teleglobe
or Orbital during the preceding year.
Without limiting the generality of the foregoing and
notwithstanding any other provision of this Agreement, the
proportion that the dollar amount of the Capital Account of a
Partner bears to the dollar amount of the Capital Account of the
other Partner shall at all times be equivalent to the proportion
that the Participation Percentage of such Partner bears to the
Participation Percentage of such other Partner. Accordingly, at
any time a discrepancy arises between the respective Participation
Percentages of the Partners, the General Partner will immediately
adjust upwards and/or downwards the respective Capital Accounts of
the Partners as may be required to reflect the provisions of the
preceding sentence."
2.26 SECTION 5.1(f). Subsection (f) of Section 5.1 of the Partnership
Agreement is hereby deleted in its entirety.
2.27 SECTION 6.1. The first paragraph of Section 6.1 of the Partnership
Agreement is hereby deleted in its entirety and replaced by the
following:
"Authority of the General Partner. Except to the extent required
by law or specific provisions of this Agreement, the management of
the Partnership and all Partnership affairs shall be the exclusive
responsibility of the General Partner. Without limiting the
generality of the foregoing, subject to Sections 6.2, 6.2A, 6.2B
and 6.3 hereof, the General Partner is authorized on behalf of the
Partnership, without the consent of any other Partner, to:"
2.28 SECTION 6.1. The last paragraph of Section 6.1 of the Partnership
Agreement is hereby deleted in its entirety and replaced by the
following:
"By executing this Agreement, each Partner shall be deemed to have
consented to any exercise by the General Partner of any of the
foregoing powers."
2.29 SECTION 6.2. Section 6.2 of the Partnership Agreement is hereby deleted
in its entirety and replaced by the following:
"6.2. OCC Approval. The approval of OCC shall be required to:
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(a) enter into any transaction (excluding the Definitive
Agreements) with an Affiliate of the General Partner;
(b) make on behalf of the Partnership an assignment for the
benefit of creditors, decide on behalf of the Partnership
to subject the Partnership to any proceedings under any
bankruptcy or insolvency law, decide to avail the
Partnership of the benefit of any other legislation for the
benefit of debtors, or take steps to wind up or terminate
the Partnership existence; and
(c) amend this Section 6.2.
This Section 6.2 shall no longer apply and it shall be deemed
deleted once OCC's Participation Percentage falls below 15%."
Notwithstanding anything to the contrary, this Article 2.29 will not
apply to any transaction effected pursuant to this Agreement including,
without limitation, the transactions referred to in Articles 5.2 and 7
hereof.
2.30 SECTION 6.2A. A new Section 6.2A is hereby added immediately following
Section 6.2 of the Partnership Agreement:
"6.2A. OCC Approval. The approval of OCC shall be required to
amend, in a manner detrimental to OCC, the provisions of Sections
3, 4, 5, 6.2A and 10 of this Agreement, it being understood that
any amendment to any such Sections upon the admission of another
Limited Partner that is not an Affiliate of the General Partner
shall not be deemed to be detrimental to OCC if all Limited
Partners are treated substantially equally in connection with such
amendment."
2.31 SECTION 6.2B. A new Section 6.2B is hereby added immediately following
Section 6.2A of the Partnership Agreement:
"6.2B. OCC Approval. Subject to the terms hereof, the approval of
OCC shall be required to:
(a) transfer all or substantially all the assets of the
Partnership or contract to do so;
(b) merge or consolidate the Partnership with any other Person;
provided, however, that this subsection (b) shall not be
applicable in the event such merger or consolidation is
deemed fair from a financial point of view to the
Partnership in the written opinion of a major investment
banking firm selected by the Partnership which shall not
have rendered financial advisory services to the
Partnership, Teleglobe or Orbital during the preceding
year;
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(c) permit the entry by the Partnership into any additional
lines of business other than those described in Section
1.3, as contemplated in the Omnibus Agreement or directly
related thereto;
(d) select or remove the independent certified public
accountant for the Partnership pursuant to Section 8.4 or
adopt, or modify in any material respect, any significant
accounting policy or tax policy;
(e) determine the value of the Partnership for purposes of
Article X of the Master Agreement; and
(f) amend any provision of this Agreement; provided, however,
that notwithstanding any other provision of this Agreement,
no Partner shall delay, frustrate or otherwise interfere
with in any way the raising of debt or equity financing by
the Partnership from any Person not currently admitted to
the Partnership which financing has been initiated or
approved by the General Partner (it being understood that
the simultaneous raising of debt or equity financing by OCC
or Teleglobe Mobile shall be deemed for the purposes hereof
to interfere with the raising of debt or equity financing
by the Partnership); provided that in the case of any such
equity financing, the consideration expected to be received
by the Partnership from such financing shall be fair to the
Partnership as determined by the General Partner; and
provided further that in the case of any such equity
financing (executed in one transaction or a series of
transactions) which is intended to result in the admission
to the Partnership of a Person or Persons who following
such financing would hold a Participation Percentage or
Participation Percentages equal to or greater than
twenty-five percent (25%), the consideration expected to be
received by the Partnership from such financing shall be
fair to the Partnership, in the written opinion of a major
investment banking firm selected by the Partnership which
shall not have rendered financial advisory services to the
Partnership, Teleglobe or Orbital during the preceding
year.
This Section 6.2B shall no longer apply and it shall be deemed
deleted once OCC's Participation Percentage falls below 31.67%;
provided, however, that should OCC's Participation Percentage
return to 31.67% or higher after having fallen below 31.67% solely
as a result of the conversion referred to in Subsection 3.3.3 of
the Omnibus Agreement, then this Section 6.2B will apply again
until OCC's Participation Percentage thereafter falls below
31.67%, at which time this Section 6.2B shall no longer apply and
it shall be deemed deleted."
2.32 SECTION 6.3. Section 6.3 of the Partnership Agreement is hereby deleted
in its entirety.
2.33 SECTION 6.4. Section 6.4 of the Partnership Agreement is hereby deleted
in its entirety and replaced by the following:
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"6.4. Meetings. Meetings of the Partners may be called by the
General Partner and shall be held at the principal offices of the
Partnership or at such other location as shall be reasonably
determined by the General Partner. Except as otherwise specified
in Section 8.5 hereof, the General Partner shall have no
obligation to call a meeting of the Partners at any time.
Notwithstanding any provision of applicable law, not less than
forty-eight (48) hours prior written notice of the time, place and
purpose of each meeting of the Partners shall be provided to each
Partner, provided that any Partner may waive compliance with such
notice requirement. Any meeting may be adjourned from time to time
by the General Partner, and the meeting may be held as adjourned
without further notice. Any one or more Partners may participate
in any meeting by means of conference telephone, video or similar
communications equipment allowing all persons participating in the
meeting to hear each other at the same time. Participation by
Partners in a meeting held by means of a conference telephone,
video or similar communications equipment shall constitute
presence in person at a meeting. Any action required or permitted
to be taken with the approval of one or more Partners may be taken
without a meeting upon the written consent of such Partners, which
written consent shall be filed with the records of the meetings of
the Partners."
2.34 SECTION 6.5. Section 6.5 of the Partnership Agreement is hereby deleted
in its entirety and replaced by the following:
"6.5. Representation at Meetings; Reimbursement. The General
Partner shall be represented at meetings of the Partners by up to
three authorized officers or other authorized agents, it being the
expectation of the General Partner that it will select three
representatives who will use reasonable efforts to attend each
meeting of the Partners. At each meeting of the Partners, one
representative of the General Partner shall be entitled to vote
such Partner's Participation Percentage. The General Partner shall
be entitled to reimbursement of the reasonable out-of-pocket
expenses incurred by it or its representatives in attending
meetings of the Partners. No amount so paid to any such member
shall be deemed to be a distribution of Partnership assets for
purposes of this Agreement or the Delaware Act. Except for the
reimbursement of expenses as provided in this Section 6.5, the
General Partner or representatives thereof shall not receive any
compensation for its, his or her services as such.
In addition, so long as OCC's Participation Percentage is not less
than fifteen percent (15%), then at each meeting of the Partners,
two representatives of OCC as well as the Chief Executive Officer
of ORBCOMM shall be entitled to be present as observers and OCC
shall be entitled to reimbursement of expenses to the extent set
forth for the General Partner herein with respect to its two
representatives, except for travel expenses."
2.35 SECTION 6.8. Section 6.8 of the Partnership Agreement is hereby deleted
in its entirety.
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2.36 SECTION 6.9. Section 6.9 of the Partnership Agreement is hereby deleted
in its entirety.
2.37 SECTION 8.3. The phrase "using ORBCOMM financial formats, which formats
shall be previously approved by Teleglobe Mobile" found in Subsection (b)
of Section 8.3 of the Partnership Agreement is hereby deleted in its
entirety and replaced by the phrase "using Teleglobe Mobile financial
formats, which formats shall be approved by OCC, such approval not to be
unreasonably withheld or delayed."
2.38 SECTION 8.3. The last sentence of Subsection (b) of Section 8.3 of the
Partnership Agreement is hereby deleted in its entirety.
2.39 SECTION 8.3. The first sentence of Subsection (c) of Section 8.3 of the
Partnership Agreement is hereby deleted in its entirety and replaced by
the following:
"Teleglobe Mobile shall be the Tax Matters Partner of the
Partnership."
Orbital and OCC agree to provide all necessary assistance to Teleglobe
Mobile and ORBCOMM to provide for an orderly transition of the status of
the Tax Matter Partner (as defined in the Partnership Agreement) from OCC
to Teleglobe Mobile, including, without limitation, the preparation of
tax filings for the year ended December 31, 1999, the transfer of all
previously filed tax filings and back-up documentation as well as access
to the necessary Orbital personnel. Orbital shall be reimbursed promptly
upon invoice for reasonable costs and expenses associated with such
assistance.
2.40 SECTION 8.4. The words "KPMG Peat Marwick" found in Section 8.4 of the
Partnership Agreement are hereby deleted in their entirety and replaced
by "Arthur Andersen".
2.41 SECTION 8.5. Section 8.5 of the Partnership Agreement is hereby deleted
in its entirety and replaced by the following:
"8.5. Review Policies. So long as OCC's Participation Percentage
is not less than fifteen percent (15%), the financial performance
and business of the Partnership shall be reviewed at least
quarterly by the General Partner at a meeting of the Partners."
2.42 SECTION 10.3. Section 10.3 of the Partnership Agreement is hereby deleted
in its entirety and replaced by the following:
"Upon the dissolution of the Partnership, the General Partner, or,
in the case of an Event of Withdrawal of the last remaining
General Partner, one of the Limited Partners elected by a majority
vote of the Limited Partners, shall act as liquidator to wind up
the Partnership. The liquidator shall have full power and
authority to sell, assign and encumber any or all of the
Partnership's assets and to wind up and liquidate the affairs of
the Partnership in an orderly and business-like manner. All
proceeds from liquidation shall be distributed in the following
order of priority: (a)
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to the payment of the debts and liabilities of the Partnership and
expenses of liquidation; (b) to the setting up of such reserves as
the liquidator may reasonably deem necessary for any contingent
liability of the Partnership; and (c) the balance to the Partners
pro rata in accordance to their respective Participation
Percentages."
2.43 SECTION 11.1. The words "Executive Vice President, Corporate Development
and Corporate Secretary" referred to in Section 11.1 of the Partnership
Agreement are hereby deleted and replaced by "Vice President, Chief Legal
Officer and Corporate Secretary."
2.44 FAIR MARKET VALUE. Any and all references to "fair market value" and
"fair market values" in the Partnership Agreement are hereby deleted and
replaced by "fair value" and "fair values", respectively.
2.45 AMENDED AND RESTATED PARTNERSHIP AGREEMENT. The Parties agree to execute
concurrently with the execution of this Agreement the Amended and
Restated Partnership Agreement attached hereto as Schedule A which gives
effect to the amendments provided herein.
ARTICLE 3
PROCUREMENT AGREEMENTS
3.1 EXISTING NON-INVOICED AMOUNTS. After giving effect to subparagraph (vii)
of Section 3.1(a) of the 1995 Procurement Agreement, as provided in
Article 3.9.1 hereof, the Parties confirm that Orbital's invoiceable but
non-invoiced amounts to ORBCOMM under the Procurement Agreements as of
July 1999 are equal to $66,163,290.44 (the "EXISTING NON-INVOICED
AMOUNTS").
3.2 INVOICING OF EXISTING NON-INVOICED AMOUNTS; TELEGLOBE MOBILE
CONTRIBUTION. Concurrently with the execution of this Agreement:
3.2.1 Orbital will send ORBCOMM an invoice in the amount of
$33,081,645.22, representing half of the amount of the Existing
Non-Invoiced Amounts (the "FIRST EXISTING INVOICE");
3.2.2 Teleglobe Mobile will contribute to ORBCOMM an amount equal to the
First Existing Invoice by way of wire transfer in exchange for
Partnership Interests of ORBCOMM;
3.2.3 upon receipt of the contribution specified in Subsection 3.2.2,
ORBCOMM will pay the First Existing Invoice to Orbital by way of
wire transfer;
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3.2.4 upon receipt of the payment specified in Subsection 3.2.3, Orbital
will pay all amounts due under the Teleglobe Promissory Notes by
way of wire transfer as per the terms of the instructions attached
hereto as Schedule B; and
3.2.5 the Teleglobe Promissory Notes will be deemed to be paid in full
and cancelled.
Completion of the steps referred to in this Article 3.2 hereof will not
result in an adjustment under Section 3.7 or 5.1(d) of the Partnership
Agreement, the contribution referred to in Subsection 3.2.2 hereof being
already reflected in Section 3.1 of the Partnership Agreement.
3.3 ADDITIONAL INVOICING OF EXISTING NON-INVOICED AMOUNTS. Subject to all
necessary consents from lenders being granted to Orbital at the latest by
March 31, 2000 (failing which the terms of Subsection 3.6.3 hereof will
apply) and within three (3) Business Days of such consents being granted
to Orbital:
3.3.1 Orbital will send ORBCOMM a second invoice in the amount of
$33,081,645.22, representing the other half of the amount of the
Existing Non-Invoiced Amounts not invoiced under the First
Existing Invoice (the "SECOND EXISTING INVOICE");
3.3.2 Orbital will assign the Second Existing Invoice to OCC and an
adjustment shall be made to intercompany accounts consistent with
past practice;
3.3.3 OCC will request ORBCOMM to convert the full amount of the Second
Existing Invoice into a contribution to Partnership Interests of
ORBCOMM;
3.3.4 ORBCOMM will accept such request and the Second Existing Invoice
will be deemed fully paid; and
3.3.5 the respective Participation Percentages and Capital Accounts of
the Partners will be immediately adjusted pursuant to the terms of
Sections 3.7 and 5.1(d) of the Partnership Agreement.
Orbital hereby undertakes to use all reasonable commercial efforts to
obtain all of the necessary consents from lenders referred to above as
soon as possible.
3.4 DETERMINATION OF PENDING NON-INVOICED AMOUNTS; FUTURE INVOICING. After
giving effect to subparagraph (viii) of Section 3.1(a) of the 1995
Procurement Agreement as provided in Article 3.9.1 hereof, the Parties
hereby agree, subject to the following, that the invoiceable but
non-invoiced amounts owed by ORBCOMM under the Procurement Agreements up
to December 31, 1999, excluding the Existing Non-Invoiced Amounts, are
equal to $25,137,209 and are referred to herein as the "PENDING
NON-INVOICED AMOUNTS". Subject to the following sentence, it is
understood by the Parties that the Existing Non-Invoiced Amounts and the
Pending Non-Invoiced Amounts together represent all amounts Orbital is
entitled to invoice under the Procurement Agreements, the Administrative
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Services Agreement and open task orders for the period up to and
including December 31, 1999. Notwithstanding the preceding sentences, the
Parties agree that an amount of $1,152,779 plus the applicable interest
has been included in the Pending Non-Invoiced Amounts as Plane A
incentive fees payable pursuant to Article 4 of the 1995 Procurement
Agreement (the "PLANE A INCENTIVE FEES") regardless of the fact that the
Plane A Incentive Fees have not yet been agreed upon by the Parties. The
Parties agree to negotiate the Plane A Incentive Fees, if any, in good
faith at the latest by the Closing Date. At the Closing Date, an upward
or downward adjustment to the Pending Non-Invoiced Amounts and to the
amounts provided in Subsections 3.5.1, 3.6.1, 3.6.2 and 3.9.1 hereof will
be effected to give effect to the final determination of the Plane A
Incentive Fees. The difference between the amount currently provided for
in Subsection 3.5.1 and the re-adjusted amount, if any, to be provided
for in Subsection 3.5.1 will be reimbursed by Orbital to ORBCOMM or paid
by ORBCOMM to Orbital, as the case may be, at the Closing and the
Participation Percentages and Capital Accounts of the Partners will be
adjusted accordingly.
3.5 INVOICING OF PENDING NON-INVOICED AMOUNTS; TELEGLOBE MOBILE CONTRIBUTION.
Concurrently with the execution of this Agreement:
3.5.1 Orbital will send ORBCOMM an invoice in the amount of $8,379,070
(i.e. 33 1/3% of the Pending Non-Invoiced Amounts) (the "PENDING
INVOICE"). The balance of the Pending Non-Invoiced Amounts shall
be paid in accordance with the provisions of Subsections 3.6.1 and
3.6.2 hereof;
3.5.2 upon receipt of the invoice specified in Subsection 3.5.1,
Teleglobe Mobile will contribute to ORBCOMM an amount equal to the
amount of the Pending Invoice by way of wire transfer in exchange
for Partnership Interests in ORBCOMM;
3.5.3 upon receipt of the contribution specified in Subsection 3.5.2,
ORBCOMM will pay the Pending Invoice to Orbital by way of wire
transfer; and
3.5.4 the respective Participation Percentages and Capital Accounts of
the Partners will be immediately adjusted pursuant to Sections 3.7
and 5.1(d) of the Partnership Agreement.
3.6 INVOICING OF OTHER AMOUNTS. Subject to the last paragraph of Article 8.4
hereof, but notwithstanding any provision of the Procurement Agreements,
the Parties agree that:
3.6.1 Orbital will invoice ORBCOMM under the Procurement Agreements an
additional amount equal to $8,379,070 (i.e. 33 1/3% of the Pending
Non-Invoiced Amounts) on March 31, 2001 (plus the applicable
additional amounts payable pursuant to Article 3.11 hereof);
3.6.2 Orbital will invoice ORBCOMM under the Procurement Agreements an
additional amount equal to $8,379,069 (i.e. the balance of the
Pending Non-
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Invoiced Amounts) on June 30, 2001 (plus the applicable additional
amounts payable pursuant to Article 3.11 hereof); and
3.6.3 in the event the transactions referred to in Article 3.3 hereof
cannot be completed by March 31, 2000, Orbital will invoice
ORBCOMM under the Procurement Agreements on March 31, 2001 an
amount equal to $33,081,645.22, representing the amount referred
to in Article 3.3.1 hereof, together with interest accrued thereon
from March 31, 2000 through March 31, 2001 at a rate per annum
(computed on the basis of a 360-day year comprised of twelve
30-day months) equal to nine percent (9%).
The amounts referred to in subsections 3.6.1, 3.6.2 and 3.6.3 hereof are
collectively referred to herein as the "DELAYED NON-INVOICED AMOUNTS" and
any invoice with respect to such amounts is referred to herein as a
"DELAYED INVOICE".
3.7 ORBITAL CONVERSION OPTION. In the event that any Delayed Non-Invoiced
Amounts are not paid by ORBCOMM within five (5) Business Days of the date
on which they are invoiced by Orbital pursuant to Article 3.6 hereof,
then Orbital will have the option (the "CONVERSION OPTION") to convert
the whole of the unpaid Delayed Non-Invoiced Amounts covered by the
applicable Delayed Invoice into a contribution to Partnership Interests
of ORBCOMM. The Conversion Option shall be exercised by Orbital by giving
ORBCOMM and Teleglobe Mobile notice in writing (the "CONVERSION NOTICE OF
EXERCISE") of its intention to exercise the Conversion Option with
respect to any applicable Delayed Invoice within twenty (20) Business
Days following the due date of such Delayed Invoice, failing which the
Conversion Option with respect to such Delayed Invoice will be cancelled.
Orbital shall not have the right to assign the Conversion Option.
Completion of the exercise of the Conversion Option with respect to any
applicable Delayed Invoice shall take place at the offices of ORBCOMM at
11:00 a.m. (local time) on the third (3rd) Business Day following receipt
by both ORBCOMM and Teleglobe Mobile of the applicable Conversion Notice
of Exercise and shall proceed as follows:
3.7.1 Orbital will assign the applicable invoice to OCC and an
adjustment shall be made to intercompany accounts consistent with
past practice;
3.7.2 OCC will request ORBCOMM to convert the full unpaid amount of such
applicable invoice into a contribution to Partnership Interests of
ORBCOMM;
3.7.3 ORBCOMM will accept such request and such applicable invoice shall
be deemed fully paid; and
3.7.4 an adjustment to the Participation Percentages and the Capital
Accounts of each of the Partners pursuant to Sections 3.7 and
5.1(d) of the Partnership Agreement or any other similar provision
then in effect dealing with the treatment of additional
contributions by Partners will be immediately effected.
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Notwithstanding any provision in Article 3.6 and 3.7 to the contrary, in
the event that ORBCOMM fails to pay amounts due and payable to Orbital
under the Procurement Agreements (other than amounts disputed in good
faith by ORBCOMM in accordance with the terms of the Procurement
Agreements), then the Delayed Non-Invoiced Amounts shall become, if such
failure continues for five (5) Business Days following written notice
thereof by Orbital to ORBCOMM and Teleglobe Mobile, due and payable and
Orbital shall have the option to convert the entire Delayed Non-Invoiced
Amounts (other than amounts disputed in good faith by ORBCOMM in
accordance with the terms of the Procurement Agreements) into a
contribution to Partnership Interests of ORBCOMM. If Orbital decides to
exercise such option to convert, it shall provide written notice of
exercise to ORBCOMM and Teleglobe Mobile within five (5) Business Days of
the expiration of the five (5) Business Day-period referred to above and
the option shall be exercisable by Orbital on the second (2nd) Business
Day following the sending of such written notice and shall proceed as set
forth in Articles 3.7.1 to 3.7.4 herein. For the purposes of this
paragraph, the amendments to be effected pursuant to Article 3.11 will be
effected as of the date the unpaid amounts are paid by ORBCOMM or, if the
option to convert is exercised by Orbital, as of the date of conversion.
3.8 ACCESS AND INVESTIGATION. From the date of this Agreement, Orbital will
afford Teleglobe, ORBCOMM and their representatives full and free access
to Orbital's personnel, properties, contracts, books and records, and
other documents and data as Teleglobe and ORBCOMM may reasonably request
in order to validate Orbital's invoices under the Procurement Agreements.
3.9 AMENDMENTS TO 1995 PROCUREMENT AGREEMENT. The 1995 Procurement Agreement
shall be amended as follows:
3.9.1 ARTICLE 3.1(a). Article 3.1(a) of the 1995 Procurement Agreement
shall be amended to add new subparagraphs (vii) and (viii)
immediately following subparagraph (vi) that read as follows:
"(vii) Price Adjustment Changes From
October 1, 1999 to December 31, 1999
Outside the General Scope of the Agreement $1,194,673
"(viii) Price Adjustment Changes through
December 31, 1999 Outside
the General Scope of the Agreement $555,467"
3.9.2 ARTICLE 3.1(a). Article 3.1(a) of the 1995 Procurement Agreement
shall be amended to delete the "TOTAL" price of $169,505,816 set
forth therein and to replace it with the new "TOTAL" price of
$171,255,956.
3.9.3 ARTICLE 4.1(b)(i). Article 4.1(b)(i) of the 1995 Procurement
Agreement shall be deleted in its entirety and replaced with the
following:
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"(i) Orbital shall be entitled to invoice ORBCOMM Global on a
monthly basis for a maximum of 90% of its costs incurred during
such month, other than costs associated with Sections 3.1(a)(iv),
3.1(a)(v), 3.1(a)(vi), 3.1(a)(vii), 3.1(a)(viii), 3.1(c) and
3.1(d), plus to the extent permitted by Section 4.1(f), such
portion of the cost in excess of the maximum amount to be invoiced
to ORBCOMM Global in accordance with such Section 4.1(f) and not
previously invoiced and paid; provided, however, that Orbital
shall not be entitled to invoice ORBCOMM Global under Section
4.1(a) and this Section 4.1(b)(i) in a cumulative total amount
greater than $126,390,568."
3.9.4 ARTICLE 4.4(ii). Article 4.4(ii) of the 1995 Procurement Agreement
is hereby deleted in its entirety.
3.10 AMENDMENTS TO 1999 PROCUREMENT AGREEMENT. ORBCOMM and Orbital hereby
agree to finalise by the Closing Date the manner by which the Exercised
Optional Satellite Allocated Costs, the Exercised Optional Satellite
Allocated Price, the Exercised Optional Satellite Difference Credit, the
Propulsion Ring Actual Price, and the Propulsion Ring Difference Credit
(as such terms are defined in the 1999 Procurement Agreement) are to be
calculated under the 1999 Procurement Agreement, as well as the manner in
which these amounts are to be paid, and to do so along the lines set
forth in Schedule C hereto.
3.11 FURTHER AMENDMENTS TO PROCUREMENT AGREEMENTS. The Parties agree to
execute an amendment to the 1995 Procurement Agreement and/or the 1999
Procurement Agreement effective as of March 31, 2000 or June 30, 2000, as
applicable, in a form similar to Article 3.9 hereof or any other
acceptable form, which will provide for a price adjustment under such
Procurement Agreements equal to the interest accrued on the Delayed
Non-Invoiced Amounts from January 1, 2000 until March 31, 2001 for the
amount referred to in Article 3.6.1 hereof and until June 30, 2001 for
the amounts referred to in Articles 3.6.2 and 3.6.3 hereof, at a rate per
annum (computed on the basis of a 360-day year comprised of twelve 30-day
months) equal to 9%.
3.12 PROCUREMENT AGREEMENT RELATED ITEMS. Orbital will proceed, at the latest
by the Closing Date, to transfer to ORBCOMM all source codes,
documentation, and related tools required for ORBCOMM to maintain and
upgrade as required and on its own the on-board satellite software.
3.13 1995 PROCUREMENT AGREEMENT. The last two sentences of Article 13.2 of the
1995 Procurement Agreement are hereby deleted in their entirety and
replaced by the following:
"To the extent that ORBCOMM Global designs modifications to the
Background Information, it shall have the right to implement such
modifications; provided, however, that if ORBCOMM Global decides
to implement such modifications without the prior written consent
of Orbital and the Satellites on which such modifications were
implemented become non-Working Satellites thereafter, the
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unpaid portion of the On-orbit Performance Incentive Payment shall
become payable thirty (30) days after the failure by ORBCOMM
Global to reasonably demonstrate that such modifications have not
caused such otherwise Working Satellites to become non-Working
Satellites. ORBCOMM Global will have up to one hundred and eighty
(180) days from the date the Working Satellites become non-Working
Satellites to make the demonstration referred to in the preceding
sentence."
3.14 1999 PROCUREMENT AGREEMENT. The last two sentences of Article 13.2 of the
1999 Procurement Agreement are hereby deleted in their entirety and
replaced by the following:
"To the extent that ORBCOMM Global designs modifications to the
Background Information, it shall have the right to implement such
modifications; provided, however, that if ORBCOMM Global decides
to implement such modifications without the prior written consent
of Orbital and the Satellites on which such modifications were
implemented become non-functional Satellites thereafter, the
unpaid portion of the Incentive Fee shall become payable thirty
(30) days after the failure by ORBCOMM Global to reasonably
demonstrate that such modifications have not caused such otherwise
functional Satellites to become non-functional Satellites. ORBCOMM
Global will have up to one hundred and eighty (180) days from the
date the functional Satellites become non-functional Satellites to
make the demonstration referred to in the preceding sentence."
3.15 INTERPRETATION. To the extent required, this Article 3 constitutes an
amendment to the terms of the Procurement Agreements. If the terms of
this Agreement contradict the terms of the Procurement Agreements, this
Agreement shall prevail.
ARTICLE 4
ACKNOWLEDGEMENTS
4.1 OWNERSHIP OF ORBCOMM. The Parties confirm that, as of the date hereof
after giving effect to the amendments to the Partnership Agreement
referred to in Article 2 hereof (including the contribution referred to
in Subsection 3.2.2 hereof but excluding the contribution referred to in
Subsection 3.5.2 hereof), the Partners' respective Partnership
Percentages and Capital Accounts in ORBCOMM are summarized as follows:
Teleglobe Mobile Participation Percentage: 64.26%
(as calculated in Schedule D hereof)
OCC Participation Percentage: 35.74%
(as calculated in Schedule D hereof)
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4.2 CALCULATION EXAMPLES. Attached as Schedule E hereto are examples of the
application of the formula provided for in Section 3.7(b) of the
Partnership Agreement, as amended pursuant to Article 2.21 hereof, the
first example showing the result of the contribution referred to in
Subsection 3.5.2 hereof.
4.3 OWNERSHIP OF ORBCOMM USA. The Parties confirm that, as of the date hereof
immediately before giving effect to the Merger, ORBCOMM's and OCC's
respective Partnership Interests in ORBCOMM USA are as follows:
ORBCOMM Participation Percentage: 98%
OCC Participation Percentage: 2%
4.4 OWNERSHIP OF ORBCOMM INTERNATIONAL. The Parties confirm that, as of the
date hereof immediately before giving effect to the Merger, ORBCOMM's and
Teleglobe Mobile's respective Partnership Interests in ORBCOMM
International are as follows:
ORBCOMM Participation Percentage: 98%
Teleglobe Mobile Participation Percentage: 2%
ARTICLE 5
RIGHT TO MATCH
5.1 ORBITAL. In the event ORBCOMM shall request proposals for the
construction, integration, test, launch and operation of satellites not
currently covered or to be covered under the Procurement Agreements, then
ORBCOMM will grant Orbital an opportunity to bid on all such requests. The
requests for proposals will not contain any specifications written
specifically and deliberately to exclude Orbital; provided, however, that
specifications written to permit ORBCOMM to address what ORBCOMM, in good
faith, believes are the technical, commercial and other requirements with
respect to its business will not be deemed to have been written
specifically and deliberately to exclude Orbital. Upon completion of the
bidding process, if ORBCOMM determines in its reasonable discretion that
the terms and conditions (technical, financial and otherwise, taken as a
whole) of an offer other than the Orbital offer are better than those of
the Orbital offer (the "BETTER OFFER"), then ORBCOMM will submit the terms
and conditions of the Better Offer to Orbital and Orbital will have five
(5) Business Days to match such Better Offer. If Orbital does not respond
in writing stating that it matches all the terms and conditions of the
Better Offer within such time constraint, it will have the same effect as
Orbital refusing to match the Better Offer and ORBCOMM will be free to
accept the Better Offer. If the Better Offer is matched by Orbital, ORBCOMM
and Orbital will negotiate in good faith the terms and conditions of a
procurement agreement to be executed within thirty (30) days. If ORBCOMM
and Orbital cannot agree on the terms and conditions of
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the procurement agreement within such thirty (30) day-period acting
reasonably, ORBCOMM will be free to negotiate and contract with any
other party. This Article 5.1 shall no longer apply and be deemed
deleted upon a Change of Control of Orbital. For the purposes of this
Article 5.1, a "CHANGE OF CONTROL" shall mean:
(i) the acquisition by any Person, or any Persons acting jointly or in
concert, whether directly or indirectly, of voting securities of
Orbital which, together with all other voting securities of
Orbital held by such Persons, constitute, in the aggregate, either
(a) fifty percent (50%) or more of all outstanding voting
securities of Orbital, or (b) forty percent (40%) or more of all
outstanding voting securities of Orbital and is followed within
twenty-four (24) months of such acquisition by changes of the
members of the Board of Directors of Orbital as a result of which
the majority of the Board of Directors of Orbital consists of
individuals other than Continuing Directors (as defined below);
(ii) a merger, consolidation, reorganization or other form of business
combination (collectively, a "BUSINESS COMBINATION") of Orbital
with another entity which results in the holders of voting
securities of that other entity holding, in the aggregate, either
(a) fifty percent (50%) or more of all outstanding voting
securities of the entity resulting from the Business Combination,
or (b) forty percent (40%) or more of all outstanding voting
securities of the entity resulting from the Business Combination
and is followed within twenty-four (24) months of such Business
Combination by changes of the members of the Board of Directors of
Orbital as a result of which the majority of the Board of
Directors of Orbital consists of individuals other than Continuing
Directors;
(iii) any event or series of events (which event or series of events may
include, without limitation, a proxy fight or proxy solicitation
with respect to the election of directors of Orbital made in
opposition to the nominees recommended by the Continuing Directors
during any period of twenty-four (24) consecutive months) as a
result of which a majority of the members of the Board of
Directors of Orbital consists of individuals other than Continuing
Directors;
(iv) the sale, lease or exchange of all or substantially all of the
property of Orbital to another Person, other than to any of its
subsidiaries in the ordinary course of business of Orbital, it
being understood that the sale, lease or exchange of all or
substantially all of the satellite manufacturing business
conducted by Orbital shall be deemed to constitute a sale, lease
or exchange of all or substantially all of the property of Orbital
for purposes of this Subsection (iv); or
(v) an assignment by Orbital for the benefit of its creditors, any
proceedings under any bankruptcy or insolvency law involving
Orbital, the decision by Orbital to
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avail itself of the benefit of any legislation for the benefit of
debtors, or the taking of steps to wind up or terminate Orbital's
existence.
In addition, for purposes of this Article 5.1, "CONTINUING DIRECTORS"
shall mean with respect to any period of twenty-four (24) consecutive
months, (a) any members of the Board of Directors of Orbital on the first
(1st) day of such period, (b) any members of the Board of Directors of
Orbital elected after the first (1st) day of such period at any annual
meeting of shareholders who were nominated by the Board of Directors of
Orbital or a committee thereof, if a majority of the members of the Board
of Directors of Orbital or such committee were Continuing Directors at
the time of such nomination, and (c) any members of the Board of
Directors of Orbital elected to succeed Continuing Directors by the Board
of Directors of Orbital or a committee thereof, if a majority of the
members of the Board of Directors of Orbital or such committee were
Continuing Directors at the time of such election.
5.2 TELEGLOBE. From the date hereof, every time ORBCOMM wishes to purchase
voice, data and Internet telecommunications services in an aggregate
amount in excess of $100,000, it will grant Teleglobe (or any affiliate
thereof) an opportunity to bid for all of its outsourced voice, data and
Internet telecommunications needs. The request for proposals will be made
upon customary terms for such types of services, without any
out-of-commerce specifications other than those specifically required for
purposes of the activities to be conducted by ORBCOMM. Teleglobe (or any
affiliate thereof) will have the right to select which of the voice, data
and Internet telecommunications needs it will bid upon. Upon completion
of the bidding process, if ORBCOMM determines in its reasonable
discretion that the terms and conditions (technical, financial and
otherwise, taken as a whole) of an offer other than the Teleglobe offer
are better than those of the Teleglobe offer (the "TELECOM BETTER
OFFER"), then ORBCOMM will submit the terms and conditions of the Telecom
Better Offer to Teleglobe and Teleglobe will have five (5) Business Days
to match such Telecom Better Offer. If Teleglobe does not respond in
writing stating that it matches all the terms and conditions of the
Better Offer within such time constraint, it will have the same effect as
Teleglobe refusing to match the Telecom Better Offer and ORBCOMM will be
free to accept the Telecom Better Offer. If the Telecom Better Offer is
matched by Teleglobe, the parties will proceed to the implementation of
the services within thirty (30) days.
ARTICLE 6
GEMTRAK
6.1 PURCHASE AND SALE. Subject to the terms and conditions herein contained,
Orbital and ORBCOMM or any affiliate thereof hereby agree to execute at
Closing an asset purchase agreement pursuant to which Orbital will sell,
transfer and assign to ORBCOMM or any
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affiliate thereof, and ORBCOMM or any affiliate thereof will purchase and
accept from Orbital, the GEMtrak Business. The asset purchase agreement
will be prepared in a form customary for similar transactions and will
include, without limitation, customary representations and warranties as
at March 31, 1999 and a list of purchased and excluded assets and assumed
and non-assumed liabilities. The purchase and sale of the GEMtrak
Business will be structured (i) so as to comply with the terms of the
Indenture, and (ii) in the most efficient tax manner for, to the extent
possible, all Parties involved, with Orbital's tax objectives prevailing.
6.2 PURCHASE PRICE. The price payable by ORBCOMM or any affiliate thereof to
Orbital for the GEMtrak Business will be agreed upon in good faith
between Orbital and Teleglobe, with the assistance of Booz Allen &
Hamilton Inc. (the "GEMTRAK PURCHASE PRICE"). It is the current
expectation of the Parties that the GEMtrak Purchase Price will be
approximately equal to the ORBCOMM Canada Purchase Price. The Parties
agree to provide Booz Allen & Hamilton Inc. with all required information
in connection with the provision by it of such assistance. In the event
Orbital and Teleglobe cannot agree on the GEMtrak Purchase Price by
February 4, 2000, Orbital and Teleglobe will immediately mandate Bear
Stearns & Co. to determine, at the latest by February 18, 2000, the fair
value of the GEMtrak Business, in which case Orbital and Teleglobe agree
that the GEMtrak Purchase Price will be the fair value of the GEMtrak
Business as so determined by Bear Stearns & Co. The fees of Bear Stearns
& Co. will be shared equally between Orbital and Teleglobe.
6.3 EFFECTIVE TIME OF SALE. The purchase and sale of the GEMtrak Business
will occur and take effect as of the Closing Date.
6.4 PAYMENT. The GEMtrak Purchase Price will be payable in full on the
Closing Date in a form to be agreed upon between the Parties.
6.5 ACCESS AND INVESTIGATION. Between the date of this Agreement and the
Closing Date, Orbital will, and will cause its representatives to, afford
ORBCOMM, Teleglobe and their representatives full and free access to
Orbital's (as it relates to GEMtrak) personnel, properties, contracts,
books and records, and other documents and data as ORBCOMM or Teleglobe
may reasonably request.
6.6 OPERATION OF GEMTRAK BUSINESS. Between the date of this Agreement and the
Closing Date, Orbital will not act so as to modify the current business
organization of the GEMtrak Business and the relations and goodwill with
suppliers, customers, landlords, creditors, employees, agents, and others
having business relationships with the GEMtrak Business.
6.7 NON COMPETE. Orbital acknowledges that it has become familiar with the
proprietary aspects of the GEMtrak Business including certain of the
confidential information and trade secrets related to the GEMtrak
Business and covenants and agrees that it shall not and shall cause its
subsidiaries and affiliates not to, for a period of three (3) years from
the date hereof, solely or jointly, on its own behalf or on behalf of any
Person, directly or indirectly,
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in any capacity whatsoever including but not limited to, as a partner,
shareholder, owner or otherwise:
6.7.1 except in connection with the fulfillment of their respective
obligations under any of the Definitive Agreements, carry on,
engage, participate, invest or have an equity interest in, or have
any financial interest in the developing, designing,
manufacturing, and marketing and selling to commercial customers
of automated tracking and cargo status data systems for unpowered
mobile assets such as truck trailers, railcars and containers; or
6.7.2 assist in or influence the engagement or hiring by any Person that
competes with the GEMtrak Business of any salesman, distributor,
or employee of the GEMtrak Business or otherwise cause any Person
having a business relationship with the GEMtrak Business to sever
such relationship with the GEMtrak Business.
None of Orbital, its subsidiaries or its affiliates shall be in default
under this Article 6.7 by virtue of holding for portfolio purposes as a
passive investor not more than five percent (5%) of the issued and
outstanding equity securities of a corporation, the securities of which
are listed or quoted on a stock exchange or on an over-the-counter market
within the United States or Canada.
ARTICLE 7
ORBCOMM CANADA
7.1 PURCHASE AND SALE. Subject to the terms and conditions herein contained,
Teleglobe or any affiliate thereof and ORBCOMM or any affiliate thereof
hereby agree to execute at Closing an agreement pursuant to which
Teleglobe or any affiliate thereof will sell, transfer and assign to
ORBCOMM or any affiliate thereof, and ORBCOMM or any affiliate thereof
will purchase and accept from Teleglobe or any affiliate thereof, the
business currently conducted by ORBCOMM Canada. The agreement will be
either a share, subscription, merger or asset purchase agreement, will be
prepared in a form customary for similar transactions and will include,
without limitation, customary representations and warranties. The
purchase and sale of the business of ORBCOMM Canada will be structured
(i) so as to comply with the terms of the Indenture, and (ii) in the most
efficient tax manner for, to the extent possible, all Parties involved
with Teleglobe's tax objectives prevailing, including, without
limitation, by crystallizing Teleglobe's participation in ORBCOMM Canada
through the cancellation of outstanding common shares of ORBCOMM Canada,
their replacement by preferred shares redeemable at the holder's option
and the issuance of new common shares of ORBCOMM Canada to ORBCOMM or an
affiliate thereof. Teleglobe will use its reasonable commercial efforts
to sell 100% of the business of ORBCOMM
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Canada to ORBCOMM or any affiliate thereof, including the interest held
by Meder Communications Inc.
7.2 PURCHASE PRICE. The price payable by ORBCOMM or any affiliate thereof to
Teleglobe or any affiliate thereof for the business of ORBCOMM Canada
will be agreed upon in good faith between Orbital and Teleglobe, with the
assistance of Booz Allen & Hamilton Inc. (the "ORBCOMM CANADA PURCHASE
PRICE"). It is the current expectation of the Parties that the ORBCOMM
Canada Purchase Price will be approximately equal to the GEMtrak Purchase
Price. The Parties agree to provide Booz Allen & Hamilton Inc. with all
required information in connection with the provision by it of such
assistance. In the event Orbital and Teleglobe cannot agree on the
ORBCOMM Canada Purchase Price by February 4, 2000, Orbital and Teleglobe
will immediately mandate Bear Stearns & Co. to determine, at the latest
by February 18, 2000, the fair value of ORBCOMM Canada, in which case
Orbital and Teleglobe agree that the ORBCOMM Canada Purchase Price will
be the fair value of ORBCOMM Canada as so determined by Bear Stearns &
Co. The fees of Bear Stearns & Co. will be shared equally between Orbital
and Teleglobe.
7.3 EFFECTIVE TIME OF SALE. The purchase and sale of the business of ORBCOMM
Canada will occur and take effect as of the Closing Date.
7.4 PAYMENT. The ORBCOMM Canada Purchase Price is payable in full on the
Closing Date in a form to be agreed upon between the Parties.
7.5 ACCESS AND INVESTIGATION. Between the date of this Agreement and the
Closing Date, Teleglobe will, and will cause ORBCOMM Canada and its
representatives to, afford ORBCOMM, Orbital and their representatives
full and free access to ORBCOMM Canada's personnel, properties,
contracts, books and records, and other documents and data as ORBCOMM or
Orbital may reasonably request.
7.6 OPERATION OF THE BUSINESS OF ORBCOMM CANADA. Between the date of this
Agreement and the Closing Date, Teleglobe will, and will cause ORBCOMM
Canada to, conduct the business of ORBCOMM Canada only in the normal
course, use their best efforts to preserve intact the current business
organization of ORBCOMM Canada and maintain the relations and goodwill
with suppliers, customers, landlords, creditors, employees, agents, and
others having business relationships with ORBCOMM Canada, and confer with
ORBCOMM concerning operational matters of a material nature. Teleglobe
will cause all indebtedness owed to ORBCOMM Canada by either Teleglobe or
any of its affiliates to be paid in full prior to Closing.
7.7 NON COMPETE. Teleglobe acknowledges that it has become familiar with the
proprietary aspects of the business conducted by ORBCOMM Canada including
certain of the confidential information and trade secrets related to the
such business and covenants and agrees that it shall not and shall cause
its subsidiaries and affiliates not to, for a period of three (3) years
from the date hereof, solely or jointly, on its own behalf or on behalf
of any
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Person, directly or indirectly, in any capacity whatsoever including but
not limited to, as a partner, shareholder, owner or otherwise:
7.7.1 except in connection with the fulfillment of their respective
obligations under any of the Definitive Agreements, carry on,
engage, participate, invest or have an equity interest in, or have
any financial interest in the marketing or selling in Canada of
commercial low-Earth orbit non-voice satellite communications
services operating in the 137-150 MHz band or such other frequency
allocated to "little LEO" mobile satellite services below 1 GHz;
or
7.7.2 assist in or influence the engagement or hiring by any Person that
competes with the business conducted by ORBCOMM Canada of any
salesman, distributor, or employee of ORBCOMM Canada or otherwise
cause any Person having a business relationship with ORBCOMM
Canada to sever such relationship with ORBCOMM Canada.
None of Teleglobe, its subsidiaries or its affiliates shall be in default
under this Article 7.7 by virtue of holding for portfolio purposes as a
passive investor not more than five percent (5%) of the issued and
outstanding equity securities of a corporation, the securities of which
are listed or quoted on a stock exchange or on an over-the-counter market
within the United States or Canada.
ARTICLE 8
OTHER AGREEMENTS
8.1 PRESS RELEASE AND SEC FILINGS. Upon the execution of this Agreement,
Teleglobe and Orbital will disseminate the press release attached hereto
as Schedule F, and ORBCOMM will promptly file such press release with the
United States Securities and Exchange Commission on Form 8-K or other
appropriate form.
8.2 MERGER. Each of the Partners agrees to contribute their respective
Partnership Interests in ORBCOMM USA and ORBCOMM International to ORBCOMM
upon the execution of this Agreement (the "MERGER") and, to that effect,
to take such actions and execute such documents, including, without
limitation, the agreements in a form substantially similar to the
agreements attached hereto as Schedule G, as ORBCOMM may reasonably
request in order to effect the Merger. The System Charge Agreements will
terminate upon the effective date of the Merger.
8.3 ADMINISTRATIVE SERVICES AGREEMENT. The Administrative Services Agreement
will terminate upon the Closing Date and all relevant provisions will be
included in the sublease to be executed pursuant to Article 8.6 hereof.
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8.4 FCC LICENSES. Orbital and OCC agree to:
8.4.1 within three (3) Business Days of the date by which an aggregate
of seventy-five million dollars ($75,000,000) in capital
contributions or similar equity interests will have been made to
ORBCOMM by any Person from January 1, 2000 (excluding
contributions referred to in Subsections 3.2.2 and 3.3.3 hereof
but including the contribution referred to in Subsection 3.5.2
hereof), file an application with the FCC for the transfer of the
FCC Licenses to ORBCOMM, in a form reasonably satisfactory to
ORBCOMM; provided, however, that ORBCOMM shall have paid all
amounts invoiced under the Procurement Agreements as permitted
hereunder (other than with respect to amounts that ORBCOMM in good
faith has given notice of dispute thereof);
8.4.2 as may be requested by ORBCOMM, provide all necessary support for
such transfer to occur at the earliest time possible following its
filing;
8.4.3 as may be requested by ORBCOMM, support all of ORBCOMM's future
applications, petitions and communications with the FCC against
payment of all reasonable out-of-pocket expenses incurred in doing
so; and
8.4.4 take such actions and execute such documents as ORBCOMM may
reasonably request in order to effect such obligations.
In the event the satisfactory filing referred to in Subsection 8.4.1
hereof does not occur on the date indicated, Orbital will no longer be
entitled to invoice ORBCOMM for any amount, under the Procurement
Agreements or otherwise, and the application of Article 5.1 will be
suspended until such satisfactory filing occurs.
8.5 STEEPLECHASE LEASE. The Parties agree that Orbital shall sublease to
ORBCOMM the building (not the land) to be developed on Lot 8A, The
Corporate Center at Steeplechase, in compliance with the terms of the
Lease Agreement executed between Boston Properties Limited Partnership
and Orbital as of April 15, 1999 (the "STEEPLECHASE LEASE"). Such
sublease agreement will have payment terms consistent with the terms of
the Steeplechase Lease with respect to the square footage of such
building (not the land) covered by such sublease agreement without any
mark-up being charged or retained by Orbital. The sublease agreement
shall be executed at Closing, shall be assignable with the prior written
consent of Orbital which shall not be unreasonably withheld or delayed
and will be effective as of the Lease Commencement Date as defined in the
Steeplechase Lease. Orbital agrees that it will not have the right to
terminate such sublease agreement otherwise than in accordance with the
terms of the Steeplechase Lease. The sublease agreement will also provide
that ORBCOMM's employees will have access to Orbital's employee cafeteria
located nearest to the premises described above. In addition, at Closing,
Teleglobe will indemnify Orbital with respect to amounts payable by
ORBCOMM under such sublease agreement for a period of one year from the
date of ORBCOMM's default under such sublease agreement, the whole upon
terms and conditions to be negotiated in good faith
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between Orbital and Teleglobe, provided, however, that such
indemnification shall not apply to accelerated monetary obligations.
8.6 NETWORK OPERATION CENTER LEASE. The Parties agree that Orbital and
ORBCOMM will enter at Closing into a sub-lease agreement with respect to
that portion of the premises where ORBCOMM's Network Operation Center and
engineering and other services are located and where ORBCOMM employees
will remain in the Orbital Dulles facilities located on Atlantic
Boulevard. Such sublease agreement will consist of a flow-through of the
lease amounts and operating expenses payable by Orbital with respect to
the square footage covered by such sublease agreement without any mark-up
being charged or retained by Orbital. Orbital agrees that it will not
have the right to terminate such sublease agreement, otherwise than upon
the expiration of the term of the main lease (if not renewed), without
ORBCOMM's prior written consent, which can be withheld for any reason. In
addition, if ORBCOMM so requests upon six-month prior written notice,
Orbital will terminate such sublease agreement but will be entitled to
the reimbursement of reasonable expenses incurred in order to comply with
the terms of the main lease relating to the reinstatement of such
premises to the physical state provided for in the main lease.
8.7 HORSE PEN ROAD LEASE. At Closing (i) Orbital will enter into a sublease
agreement with ORBCOMM with respect to Orbital's subleasing of 25,000
square feet of the building located at 2455 Horse Pen Road, Herndon,
Virginia, such sublease agreement to commence on the Lease Commencement
Date under the Steeplechase Lease and to have payment terms consistent
with the terms of the main lease with respect to the square footage
covered by such sublease agreement without any mark-up being charged or
retained by ORBCOMM, and (ii) Teleglobe will indemnify Orbital with
respect to ORBCOMM's obligations (to the extent not assumed by Orbital)
under the main lease for Horse Pen Road, upon terms and conditions to be
negotiated in good faith between Orbital and Teleglobe.
ARTICLE 9
CLOSING
9.1 CLOSING OBLIGATIONS. The Parties acknowledge and agree that the following
steps and actions will occur on the Closing Date:
9.1.1 The Parties will complete or confirm in writing completion of the
transactions referred to in Article 3.10 and Article 3.12 hereof;
9.1.2 Orbital and ORBCOMM or an affiliate thereof will execute an asset
purchase agreement to give effect to the provisions of Article 6
hereof;
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9.1.3 Teleglobe or an affiliate thereof and ORBCOMM or an affiliate
thereof will execute a share purchase agreement, an asset purchase
agreement or any other agreement to give effect to the provisions
of Article 7 hereof; and
9.1.4 Orbital and ORBCOMM will complete the transactions referred to in
Articles 8.5, 8.6 and 8.7 hereof;
9.1.5 Orbital and OCC will deliver a certificate executed by Orbital and
OCC representing and warranting to Teleglobe, Teleglobe Mobile and
ORBCOMM that each of Orbital's and OCC's representations and
warranties in Article 10.1 and elsewhere in this Agreement was
accurate in all respects as of the date of this Agreement and is
accurate in all respects as of the Closing Date as if made on the
Closing Date and that each of Orbital's and OCC's covenants and
undertakings to be executed on or prior to the Closing Date under
this Agreement have been executed; and
9.1.6 Teleglobe and Teleglobe Mobile will deliver a certificate executed
by Teleglobe and Teleglobe Mobile representing and warranting to
Orbital, OCC and ORBCOMM that each of Teleglobe's and Teleglobe
Mobile's representations and warranties in Article 10.2 and
elsewhere in this Agreement was accurate in all respects as of the
date of this Agreement and is accurate in all respects as of the
Closing Date as if made on the Closing Date and that each of
Teleglobe's and Teleglobe Mobile's covenants and undertakings to
be executed on or prior to the Closing Date under this Agreement
have been executed.
ARTICLE 10
REPRESENTATIONS AND WARRANTIES
10.1 REPRESENTATIONS AND WARRANTIES OF ORBITAL AND OCC. Each of Orbital and
OCC hereby represents and warrants to each of ORBCOMM, Teleglobe and
Teleglobe Mobile that:
10.1.1 DUE INCORPORATION AND CAPACITY OF ORBITAL AND OCC. Each of Orbital
and OCC is a corporation duly incorporated and organized, validly
existing and in good standing under the laws of Delaware with full
corporate power and authority to conduct its business as it is now
conducted and to own or use the properties and assets that it
purports to own or use. Each of Orbital and OCC has all the
necessary rights, power and authority to enter into, execute and
deliver this Agreement and to perform its obligations hereunder.
The entry into, execution and delivery of this Agreement and the
performance by each of Orbital and OCC of its obligations
hereunder have been duly authorized and approved by all necessary
corporate action of their respective Board of Directors.
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10.1.2 BINDING NATURE. This Agreement constitutes a legal, valid and
binding obligation of Orbital and OCC enforceable against them in
accordance with its terms.
10.1.3 CONSENTS. Except for the consent of Orbital's lenders in
connection with the conversion referred to in Subsection 3.3.3
hereof, no material licenses, consents, approvals or
authorizations of, or declaration or filing with, any governmental
authority need to be obtained or made by Orbital or OCC as a
condition to or in connection with the execution, delivery and
performance by each of Orbital and OCC of this Agreement.
10.1.4 NO VIOLATION. The execution, delivery and performance by each of
Orbital and OCC of this Agreement do not and will not conflict
with or result in a breach of the terms, conditions or provisions
of, or give rise to a right of termination or constitute a default
under, or result in any violation of, (i) any law, rule or
regulation to which Orbital or OCC or any of their respective
property and assets are subject, (ii) the constating documents or
by-laws of Orbital and OCC, (iii) any resolutions of the directors
or shareholders of Orbital or OCC, (iv) except for the consent of
lenders in connection with the conversion referred to in
Subsection 3.3.3 hereof, any mortgage, credit agreement or other
material agreement or instrument to which Orbital or OCC is a
party, (v) any order, judgement or decree binding on Orbital or
OCC or any of their property, or (vi) any material license, waiver
or permit currently held by Orbital or OCC. The execution,
delivery and performance by each of Orbital and OCC of, and any
compliance with, this Agreement will not result in the creation of
any lien upon any of the property and assets of Orbital, OCC or
ORBCOMM.
10.1.5 ACTIONS PENDING. There is no action, suit or proceeding pending,
or to the knowledge of Orbital or OCC, threatened against Orbital
or OCC before any court, arbitrator or governmental body, agency
or official, which (i) questions the validity of any of the
transactions contemplated by this Agreement or (ii) would, if
adversely determined, have a material adverse effect on the
business, financial position or results of operations of Orbital,
OCC or the GEMtrak Business.
10.1.6 FCC LICENSES. OCC is the sole, true and absolute registered holder
of the FCC Licenses and the FCC Licenses are sufficient
authorization from the FCC for ORBCOMM to operate the ORBCOMM
system in the United States as presently operated. Except as
disclosed in Schedule H hereof, there is no outstanding or
unresolved application by OCC for any FCC authorization (including
any renewal of any FCC License). The FCC Licenses are valid and in
full force and effect, unimpaired by any condition or restriction
or any act or omission by Orbital or OCC which is reasonably
likely to have a material adverse effect on ORBCOMM. Except as
disclosed in Schedule H hereof, there are no modifications,
amendments, applications, revocations or other proceedings pending
or, to the knowledge of Orbital or OCC, threatened, with respect
to the FCC Licenses (other
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than proceedings that apply to the telecommunications industry
generally), and no event has occurred which, with or without the
giving of notice or lapse of time or both, would constitute
grounds for revocation of the FCC Licenses. Except where a lack of
compliance is not reasonably likely to have a material adverse
effect, since January 1, 1999 all reports required by the
Communications Act or required to be filed with the FCC by Orbital
or OCC have been filed and are accurate and complete in all
material respects. Except where a lack of compliance is not
reasonably likely to have a material adverse effect, Orbital and
OCC have operated their business in compliance with the
Communications Act and the rules, regulations, policies and orders
thereunder. Orbital and OCC have not received any notice (or
otherwise been advised) to the effect that they are in violation
of any of such statutes, rules, regulations, policies or orders.
10.1.7 OWNERSHIP OF ORBCOMM AND ORBCOMM USA PARTNERSHIP INTERESTS. OCC is
the sole, true and absolute owner and registered holder of the
ORBCOMM and ORBCOMM USA Partnership Interests described in Article
4.1 and Article 4.3 with good and marketable title thereto, free
and clear of any mortgage, hypothec, pledge, security interest,
lien, charge or encumbrance or option or other rights of others
whatsoever.
10.1.8 GEMTRAK FINANCIAL STATEMENTS. Orbital has delivered to Teleglobe
and ORBCOMM the unaudited balance sheet of the GEMtrak Business as
at March 31, 1999 (the "GEMTRAK FINANCIAL STATEMENT"). The GEMtrak
Financial Statement fairly presents the financial condition of the
GEMtrak Business as at March 31, 1999, in accordance with United
States generally accepted accounting principles. Except as
disclosed in the GEMtrak Financial Statement, the GEMtrak Business
has no undisclosed liabilities or obligations of any nature
(whether known or unknown and whether absolute, accrued,
contingent, or otherwise) except for current liabilities incurred
in the ordinary course of business since the date thereof.
10.2 REPRESENTATIONS AND WARRANTIES OF TELEGLOBE AND TELEGLOBE MOBILE. Each of
Teleglobe and Teleglobe Mobile hereby represents and warrants to each of
ORBCOMM, Orbital and OCC that:
10.2.1 DUE INCORPORATION OR FORMATION AND CAPACITY OF TELEGLOBE,
TELEGLOBE MOBILE AND ORBCOMM CANADA. Teleglobe is a corporation
duly incorporated and organized, validly existing and in good
standing under the Canada Business Corporations Act. Teleglobe
Mobile is a general partnership duly formed under the laws of
Delaware. Each of Teleglobe and Teleglobe Mobile has all the
necessary right, power and authority to enter into, execute and
deliver this Agreement and to perform its obligations hereunder.
The entry into, execution and delivery of this Agreement and the
performance by each of Teleglobe and Teleglobe Mobile of its
obligations hereunder have been duly authorized and approved by
all necessary corporate action of the Board of Directors of,
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respectively, Teleglobe and Teleglobe Mobile Investment Inc.,
Teleglobe Mobile's general partner.
10.2.2 BINDING NATURE. This Agreement constitutes a legal, valid and
binding obligation of Teleglobe and Teleglobe Mobile enforceable
against them in accordance with its terms.
10.2.3 CONSENTS. No material licenses, consents, approvals or
authorizations of, or declaration or filing with, any governmental
authority need to be obtained or made by Teleglobe or Teleglobe
Mobile as a condition to or in connection with the execution,
delivery and performance by each of Teleglobe and Teleglobe Mobile
of this Agreement.
10.2.4 NO VIOLATION. The execution, delivery and performance by each of
Teleglobe and Teleglobe Mobile of this Agreement do not and will
not conflict with or result in a breach of the terms, conditions
or provisions of, or give rise to a right of termination or
constitute a default under, or result in any violation of, (i) any
law, rule or regulation to which Teleglobe or Teleglobe Mobile or
any of their respective property and assets are subject, (ii) the
constating documents or by-laws, as applicable, of Teleglobe and
Teleglobe Mobile, (iii) any resolutions of the directors,
shareholders or partners, as applicable, of Teleglobe or Teleglobe
Mobile, (iv) any mortgage, credit agreement or other material
agreement or instrument to which Teleglobe or Teleglobe Mobile is
a party, (v) any order, judgement or decree binding on Teleglobe
or Teleglobe Mobile or any of their property, or (vi) any material
license, waiver or permit currently held by Teleglobe or Teleglobe
Mobile. The execution, delivery and performance by each of
Teleglobe and Teleglobe Mobile of, and any compliance with, this
Agreement will not result in the creation of any lien upon any of
the property and assets of Teleglobe, Teleglobe Mobile and
ORBCOMM.
10.2.5 ACTIONS PENDING. There is no action, suit or proceeding pending,
or to the knowledge of Teleglobe or Teleglobe Mobile, threatened
against Teleglobe or Teleglobe Mobile before any court, arbitrator
or governmental body, agency or official, which (i) questions the
validity of any of the transactions contemplated by this Agreement
or (ii) would, if adversely determined, have a material adverse
effect on the business, financial position or results of
operations of Teleglobe or Teleglobe Mobile.
10.2.6 ORBCOMM AND ORBCOMM INTERNATIONAL PARTNERSHIP INTERESTS. Teleglobe
Mobile is the sole, true and absolute owner and registered holder
of the ORBCOMM and ORBCOMM International Partnership Interests
described in Article 4.1 and Article 4.4 with good and marketable
title thereto, free and clear of any mortgage, hypothec, pledge,
security interest, lien, charge or encumbrance or option or other
rights of others whatsoever.
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10.2.7 ORBCOMM CANADA FINANCIAL STATEMENTS. Teleglobe has delivered to
Orbital and ORBCOMM the unaudited balance sheet of ORBCOMM Canada
as at December 31 in each of the years 1996 through 1998, and the
related unaudited statement of income, changes in stockholders'
equity, and cash flow for each of the fiscal years then ended (the
"ORBCOMM CANADA FINANCIAL STATEMENTS"). The ORBCOMM Canada
Financial Statements fairly present the financial condition and
the results of operations, changes in stockholders' equity, and
cash flow of ORBCOMM Canada as at the respective dates of and for
the periods referred to in such financial statements, all in
accordance with Canadian generally accepted accounting principles,
and the ORBCOMM Canada Financial Statements reflect the consistent
application of such accounting principles throughout the periods
involved. Except as disclosed in the ORBCOMM Canada Financial
Statements, ORBCOMM Canada has no undisclosed liabilities or
obligations of any nature (whether known or unknown and whether
absolute, accrued, contingent, or otherwise) except for current
liabilities incurred in the ordinary course of business since the
respective dates thereof.
ARTICLE 11
INDEMNIFICATION
11.1 For the purposes of any claim alleging that one of the representations or
warranties contained herein is false or incorrect on the date hereof or
on the Closing Date, the rights ensuing from these representations and
warranties shall continue to have effect for a period of two years after
the date hereof notwithstanding any inspection, inquiry and verification
made by any Party or on its behalf.
11.2 If a representation or warranty of any Party is false or incorrect, such
Party and any Indemnifying Party (as defined below), on prior written
notice from any other Party, agrees to undertake the requisite measures
within 30 days from receipt of such notice to remedy the default. For the
purpose of Article 11, the Party whose representation or warranty is
false or incorrect is referred to as the "INDEMNIFYING PARTY" and the
other Parties are referred to as the "INDEMNIFIED PARTIES".
11.3 The Indemnifying Party undertakes to indemnify the Indemnified Parties,
jointly and severally with any other Indemnifying Party, for the amount
of the damages (which shall include all losses, damages, liabilities,
reasonable costs and expenses (including, without limitation, all
reasonable legal and other professional fees and disbursements, interest,
penalties and amounts paid in settlement)) sustained by the Indemnified
Parties as a result of or arising directly out of or in connection with
any breach or inaccuracy of any representation or warranty of an
Indemnifying Party contained in this Agreement, provided that:
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11.3.1 an Indemnifying Party shall not be required to indemnify or save
harmless the Indemnified Parties in respect of any breach or
inaccuracy of a representation or warranty unless (i) one of the
Indemnified Parties shall have provided notice to the Indemnifying
Party of such breach or inaccuracy, and (ii) such breach or
inaccuracy shall not have been remedied by an Indemnifying Party
in accordance with Section 11.2 to the satisfaction of the
Indemnified Parties acting reasonably, provided, however, that all
damages sustained by the Indemnified Parties as a result of or
arising directly out of or in connection with any breach or
inaccuracy of any representation or warranty of an Indemnifying
Party contained in this Agreement during the period prior to such
remedy shall be subject to the indemnification provisions of
Section 11.3;
11.3.2 if a third party files a claim against an Indemnified Party and
this claim is likely to entail falsity or inaccuracy in one or
another of the representations and warranties given by an
Indemnifying Party, the latter shall have the right, at its
expense, to participate in or assume control of the negotiations,
settlement or contestation of the third-party claim. In such case,
the Indemnifying Party shall reimburse the Indemnified Parties for
all reasonable costs and expenses the latter shall incur because
of such contestation. If the Indemnifying Party opts to assume
control of the matter, the Indemnified Parties must co-operate
with it, may participate in the negotiation, settlement or
contestation of the third-party claims and shall have the right to
choose together with the Indemnifying Party the attorney
responsible for contesting this claim.
11.4 The amount of the indemnification for any damages which the Indemnified
Parties shall be entitled to receive pursuant to this Agreement shall be
payable within 30 days following the 30-day period contemplated in
Section 11.2 and shall be determined after giving effect to (i) the
provisions of Section 11.3, (ii) tax savings and (iii) recoveries from
third parties.
ARTICLE 12
MISCELLANEOUS
12.1 SUCCESSORS AND ASSIGNS. This Agreement and the rights and obligations set
forth herein shall not be assignable by the Parties. The provisions of
this Agreement shall, except as otherwise provided herein, enure to the
benefit of and be binding upon the Parties and their respective heirs,
executors, administrators and successors and each and every Person so
bound shall make, execute and deliver all documents necessary to carry
out this Agreement.
12.2 EXPENSES. Except as otherwise specifically provided herein, each Party
shall bear and be responsible for all of its costs and expenses,
including financial advisory and legal fees and disbursements, incurred
in connection with this Agreement and the transactions hereby
contemplated.
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12.3 PUBLIC ANNOUNCEMENT. Except as provided herein or as required by law, no
press release related to this Agreement or the transactions contemplated
herein shall be issued without the joint approval of Teleglobe and
Orbital.
12.4 ENTIRE AGREEMENT. Except for the other Definitive Agreements, as amended
pursuant to the terms hereof, this Agreement constitutes the entire
agreement between the Parties with respect to the subject matter hereof
and the transactions herein contemplated and replaces all previous
agreements and understandings, if any, between the Parties with respect
to the subject matter hereof and the transactions contemplated herein.
12.5 RESOLUTION OF DISPUTES. Any controversy or claim that may arise under,
out of or in connection with or relating to this Agreement or any breach
hereof shall be settled in accordance with the terms of Article 13.4 of
the Master Agreement.
12.6 NOTICES. All notices, consents, waivers, and other communications under
this Agreement must be in writing and will be deemed to have been duly
given when (i) delivered by hand (with written confirmation of receipt),
(ii) sent by telecopier (with written confirmation of receipt), or (iii)
when received by the addressee, if sent by a nationally recognized
overnight delivery service (receipt requested), in each case to the
appropriate addresses and telecopier numbers set forth below:
If to Orbital or OCC:
Orbital Sciences Corporation
21700 Atlantic Boulevard
Dulles, Virginia
20166-6801
Fax: 703.406.3502
Attention: Executive Vice President and Chief Financial Officer
If to Teleglobe or Teleglobe Mobile:
Teleglobe Inc.
1000 de La Gauchetiere Street West
Montreal, Quebec
H3B 4X5
Fax: 514.868.7438
Attention: Vice President, Chief Legal Officer and Corporate Secretary
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If to ORBCOMM:
ORBCOMM Global, L.P.
2455 Horse Pen Road
Herndon, Virginia
20171-3426
Fax: 703.406.5933
Attention: Senior Vice President and General Counsel
Notice of change of address may be given by any Party in the same manner.
12.7 FURTHER ASSURANCES. Each Party shall do such acts and shall execute such
further documents, conveyances, deeds, assignments, transfers and the
like, and will cause the doing of such acts and will cause the execution
of such further documents as are within its power as any other Party may
in writing at any time and from time to time reasonably request be done
or executed, in order to give full effect to the provisions of this
Agreement.
12.8 INDENTURE. Should the consummation or implementation of any of the
agreements provided herein result in a breach of the terms of the
Indenture, the Parties agree to negotiate in good faith a modification to
any such agreement so that the intended result of such agreement will be
attained without breaching the terms of the Indenture.
12.9 TIME OF ESSENCE. Time shall be of the essence of this Agreement.
12.10 COUNTERPARTS. This Agreement may be executed in one or more counterparts
each of which when so executed shall be deemed to be an original and such
counterparts together shall constitute but one of the same instrument.
[remainder of page intentionally left blank -- signature page to follow]
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IN WITNESS WHEREOF the Parties have executed this Agreement as of the date set
out above.
ORBITAL SCIENCES CORPORATION
Per:
---------------------------------
ORBITAL COMMUNICATIONS CORPORATION
Per:
---------------------------------
TELEGLOBE INC.
Per:
---------------------------------
Andre Bourbonnais
Vice President, Chief Legal Officer
and Corporate Secretary
TELEGLOBE MOBILE PARTNERS
by its General Partner
TELEGLOBE MOBILE INVESTMENT INC.
Per:
---------------------------------
Andre Bourbonnais
President
ORBCOMM GLOBAL, L.P.
Per:
---------------------------------
Scott Webster
President and Chief Executive Officer
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