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EXHIBIT 10.13
ORBITAL IMAGING CORPORATION
$75,000,000
11 5/8% SENIOR NOTES DUE 2005
PURCHASE AGREEMENT
APRIL 19, 1999
BEAR, STEARNS & CO. INC.
MERRILL LYNCH & CO., MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
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ORBITAL IMAGING CORPORATION
$75,000,000
11 5/8% Senior Notes due 2005
PURCHASE AGREEMENT
April 19, 1999
New York, New York
BEAR, STEARNS & CO. INC.
MERRILL LYNCH & CO., MERRILL LYNCH, PIERCE, FENNER
& SMITH INCORPORATED
c/o Bear, Stearns & Co. Inc.
245 Park Avenue
New York, New York 10167
Ladies & Gentlemen:
Orbital Imaging Corporation, a Delaware corporation (the "Company"),
proposes to issue and sell to Bear, Stearns & Co. Inc. and Merrill Lynch & Co.,
Merrill Lynch, Pierce, Fenner & Smith Incorporated (together, the "Initial
Purchasers") $75,000,000 in aggregate principal amount of 11 5/8% Senior Notes
due 2005 (the "Notes"), subject to the terms and conditions set forth herein.
The Notes will be issued pursuant to an indenture (the "Indenture"), to be dated
the Closing Date (as defined), between the Company and HSBC Bank USA, as trustee
(the "Trustee"). Capitalized terms used herein and not otherwise defined shall
have the meanings assigned to such terms in the Indenture.
1. Issuance of Notes. The Company proposes, upon the terms and
subject to the conditions set forth herein, to issue and sell to the Initial
Purchasers $75,000,000 in aggregate principal amount of Notes. The Notes
issuable in exchange therefor are collectively referred to herein as the
"Exchange Notes."
Upon original issuance thereof, and until such time as the same is
no longer required under the applicable requirements of the Securities Act of
1933, as amended (the "Act"), the Notes (and all securities issued in exchange
therefor or in substitution thereof) shall bear the following legend:
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THE NOTE (OR ITS PREDECESSOR) EVIDENCED HEREBY WAS ORIGINALLY ISSUED
IN A TRANSACTION EXEMPT FROM REGISTRATION UNDER SECTION 5 OF THE
UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES
ACT"), AND THE NOTE EVIDENCED HEREBY MAY NOT BE OFFERED, SOLD OR
OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN
APPLICABLE EXEMPTION THEREFROM. EACH PURCHASER OF THE NOTE EVIDENCED
HEREBY IS HEREBY NOTIFIED THAT THE SELLER MAY BE RELYING ON THE
EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE SECURITIES ACT
PROVIDED BY RULE 144A THEREUNDER. THE HOLDER OF THE NOTE EVIDENCED
HEREBY AGREES FOR THE BENEFIT OF ORBITAL IMAGING CORPORATION AND ITS
SUCCESSORS (THE "COMPANY") THAT (A) SUCH NOTE MAY BE RESOLD, PLEDGED
OR OTHERWISE TRANSFERRED, ONLY (1)(a) TO A PERSON WHO THE SELLER
REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED
IN RULE 144A UNDER THE SECURITIES ACT) IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 144A, (b) IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 144 UNDER THE SECURITIES ACT, (c) OUTSIDE THE
UNITED STATES TO A PERSON THAT IS NOT A U.S. PERSON (AS DEFINED IN
RULE 902 UNDER THE SECURITIES ACT) IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 904 UNDER THE SECURITIES ACT, (d) TO AN
INSTITUTIONAL "ACCREDITED INVESTOR" (AS DEFINED IN RULE 501(a)(1),
(2), (3) OR (7) OF REGULATION D UNDER THE SECURITIES ACT) THAT,
PRIOR TO SUCH TRANSFER, FURNISHES TO THE TRUSTEE A SIGNED LETTER
CONTAINING CERTAIN REPRESENTATIONS AND AGREEMENTS RELATING TO THE
NOTES (THE FORM OF WHICH LETTER CAN BE OBTAINED FROM THE TRUSTEE) OR
(e) IN ACCORDANCE WITH ANOTHER EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT (AND BASED UPON AN OPINION OF
COUNSEL IF THE COMPANY OR TRUSTEE, REGISTRAR OR TRANSFER AGENT FOR
THE NOTES SO REQUESTS), (2) TO THE COMPANY OR (3) PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND, IN
EACH CASE, IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY
STATE OF THE UNITED STATES OR ANY OTHER APPLICABLE JURISDICTION AND
(B) THE HOLDER WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED TO,
NOTIFY ANY PURCHASER FROM IT OF THE NOTE EVIDENCED HEREBY OF THE
RESALE RESTRICTIONS SET FORTH IN (A) ABOVE.
2. Offering. The Notes will be offered and sold to the Initial
Purchasers pursuant to an exemption from the registration requirements under the
Act. The Company has prepared a preliminary offering memorandum, dated April 9,
1999 (the "Preliminary Offering Memorandum"), and a final offering memorandum,
dated April 19, 1999 (the "Offering Memorandum"), relating to the Company and
the Notes.
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The Initial Purchasers have advised the Company that the Initial
Purchasers will make offers (the "Exempt Resales") of the Notes on the terms set
forth in the Offering Memorandum, as amended or supplemented, solely to persons
whom the Initial Purchasers reasonably believe to be "qualified institutional
buyers," as defined in Rule 144A under the Act ("Eligible Purchasers"). The
Initial Purchasers will offer the Notes to such Eligible Purchasers initially at
the price set forth herein. Such price may be changed at any time without
notice.
Holders (including subsequent transferees) of the Notes will have
the registration rights set forth in the registration rights agreement relating
thereto (the "Registration Rights Agreement") in the form agreed to by the
Company and the Initial Purchasers, to be dated the Closing Date, in the form
agreed to by the Company and the Initial Purchasers, for so long as such Notes
are "Transfer Restricted Securities" (as defined in the Registration Rights
Agreement). Pursuant to the Registration Rights Agreement, the Company will
agree to file with the Securities and Exchange Commission (the "Commission"),
under the circumstances set forth therein, (i) a registration statement under
the Act (the "Exchange Offer Registration Statement") relating to the Exchange
Notes to be offered in exchange for the Notes (the "Exchange Offer") and (ii) a
shelf registration statement pursuant to Rule 415 under the Act (the "Shelf
Registration Statement") relating to the resale by certain holders of the Notes,
and to use its best efforts to cause such registration statements to be declared
effective and consummate the Exchange Offer.
The Company will use a portion of the net proceeds from the sale of
the Notes to purchase a portfolio of Government Securities pursuant to the
Pledge Agreement (the "Pledged Securities") in an amount sufficient to provide
for payment in full of the first two scheduled interest payments due on the
Notes. The Pledged Securities will be pledged as security for the benefit of the
Initial Purchasers and other holders of the Notes (including subsequent
transferees) pursuant to the Pledge Agreement, in the form agreed to by the
Company and the Initial Purchasers.
This Agreement, the Notes, the Indenture, the Registration Rights
Agreements and the Pledge Agreement are hereinafter sometimes referred to
collectively as the "Operative Documents."
3. Purchase, Sale and Delivery. (a) On the basis of the
representations, warranties and covenants contained in this Agreement, and
subject to its terms and conditions, the Company agrees to issue and sell to
each Initial Purchaser, and each Initial Purchaser agrees, severally and not
jointly, to purchase from the Company, that amount of Notes set forth opposite
its name on Schedule I hereto. The aggregate principal amount of the Notes will
be $75,000,000 and the purchase price for the Notes will be $70,830,000.
(b) Delivery of the Notes shall be made, against payment of the
purchase price therefor, at the offices of Fried, Frank, Harris, Shriver &
Jacobson, 1001 Pennsylvania Avenue, N.W., Washington, D.C. or such other
location as may be mutually acceptable. Such delivery and payment shall be made
at 10:00 a.m., New York City time, on April 22, 1999 or at such
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other time as shall be agreed upon by the Initial Purchasers and the Company.
The time and date of such delivery and payment are herein called the "Closing
Date."
(c) The Notes will initially be represented by one or more
permanent Notes in global form without interest coupons (a "Restricted Global
Note") registered in the name of Cede & Co., as nominee of DTC, having an
aggregate amount corresponding to the aggregate principal amount of the Notes.
The Restricted Global Note shall be delivered by the Company to the Initial
Purchasers (or as the Initial Purchasers direct), against payment by the Initial
Purchasers of the purchase price therefor, by wire transfer of immediately
available funds to an account specified by the Company or as the Company may
direct in writing, provided that the Company shall give at least two business
days' prior written notice to the Initial Purchasers of the information required
to effect such wire transfers. The Restricted Global Note shall be made
available to the Initial Purchasers for inspection not later than 9:30 a.m., New
York City time, on the business day immediately preceding the Closing Date.
4. Agreements of the Company. The Company covenants and agrees with
the Initial Purchasers as follows:
(a) To advise the Initial Purchasers promptly and, if requested
by the Initial Purchasers, confirm such advice in writing of: (i) the issuance
by any state securities commission of any stop order suspending the
qualification or exemption from qualification of any Notes for offering or sale
in any jurisdiction, or the initiation of any proceeding for such purpose by any
state securities commission or other regulatory authority; and (ii) the
happening of any event that, in the reasonable opinion of either counsel to the
Company or counsel to the Initial Purchasers, makes any statement of a material
fact made in the Preliminary Offering Memorandum or the Offering Memorandum
untrue or that requires the making of any additions to or changes in the
Preliminary Offering Memorandum or the Offering Memorandum in order to make the
statements therein, in the light of the circumstances under which they are made,
not misleading. The Company shall use its best efforts to prevent the issuance
of any stop order or order suspending the qualification or exemption of any
Notes under any state securities or Blue Sky laws and, if at any time any state
securities commission or other regulatory authority shall issue an order
suspending the qualification or exemption of any Notes under any state
securities or Blue Sky laws, the Company shall use its best efforts to obtain
the withdrawal or lifting of such order at the earliest possible time.
(b) To furnish the Initial Purchasers and those persons
identified by the Initial Purchasers to the Company, without charge, as many
copies of the Preliminary Offering Memorandum and the Offering Memorandum, and
any amendments or supplements thereto, as the Initial Purchasers may reasonably
request. The Company consents to the use of the Preliminary Offering Memorandum
and the Offering Memorandum, and any amendments and supplements thereto required
pursuant hereto, by the Initial Purchasers in connection with Exempt Resales.
(c) Not to amend or supplement the Preliminary Offering
Memorandum or the Offering Memorandum prior to the Closing Date unless the
Initial Purchasers shall previously
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have been advised thereof and shall not have reasonably objected thereto within
a reasonable time after being furnished a copy thereof. The Company shall
promptly prepare, upon the Initial Purchasers' request, any amendment or
supplement to the Preliminary Offering Memorandum or the Offering Memorandum
that may be necessary or advisable in connection with Exempt Resales.
(d) If, after the date hereof and prior to consummation of any
Exempt Resale, any event shall occur as a result of which, in the judgment of
the Company or in the reasonable opinion of either counsel to the Company or
counsel to the Initial Purchasers, it becomes necessary or advisable to amend or
supplement the Preliminary Offering Memorandum or Offering Memorandum in order
to make the statements therein, in the light of the circumstances in which they
were made, not misleading, or if it is necessary or advisable to amend or
supplement the Preliminary Offering Memorandum or Offering Memorandum to comply
with applicable law, (i) notify the Initial Purchasers and (ii) forthwith to
prepare an appropriate amendment or supplement to such Offering Memorandum so
that the statements therein as so amended or supplemented will not, in the light
of the circumstances when it is so delivered, be misleading, or so that such
Offering Memorandum will comply with applicable law.
(e) To cooperate with the Initial Purchasers and counsel to the
Initial Purchasers in connection with the qualification or registration of the
Notes under the securities or Blue Sky laws of such jurisdictions as the Initial
Purchasers may reasonably request and to continue such qualification in effect
so long as required for the Exempt Resales; provided, however, that the Company
shall not be required in connection therewith to register or qualify as a
foreign corporation where it is not now qualified or to take any action that
would subject it to service of process in suits or taxation, in each case, other
than as to matters and transactions relating to the Preliminary Offering
Memorandum, the Offering Memorandum or Exempt Resales, in any jurisdiction where
it is not now so subject.
(f) Whether or not the transactions contemplated by this
Agreement are consummated or this Agreement becomes effective or is terminated,
to pay all costs, expenses, fees and taxes incident to the performance of the
obligations of the Company hereunder, including in connection with: (i) the
preparation, printing, filing and distribution of the Preliminary Offering
Memorandum and the Offering Memorandum (including, without limitation, financial
statements) and all amendments and supplements thereto required pursuant hereto,
(ii) the issuance, transfer and delivery by the Company of the Notes to the
Initial Purchasers, (iii) the qualification or registration of the Notes for
offer and sale under the securities or blue sky laws of the several states
(including, without limitation, the cost of preparing, printing and mailing a
preliminary and final blue sky memorandum and the reasonable fees and
disbursements of counsel to the Initial Purchasers relating thereto), (iv)
furnishing such copies of the Preliminary Offering Memorandum and the Offering
Memorandum, and all amendments and supplements thereto, as may be requested for
use in connection with Exempt Resales, (v) the preparation of certificates for
the Notes (including, without limitation, printing and engraving thereof), (vi)
the fees, disbursements and expenses of the Company's counsel and accountants,
(vii) all expenses and listing fees in connection with the application for
quotation of the Notes in the National Association of Securities Dealers, Inc.
("NASD") Automated Quotation
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System - PORTAL ("PORTAL"), (viii) all fees and expenses (including fees and
expenses of counsel to the Company) of the Company in connection with the
approval of the Notes by DTC for "book-entry" transfer, (ix) the rating of the
Notes by rating agencies, (x) the reasonable fees and expenses of the Trustee
and its counsel in connection with the Indenture and the Notes, (xi) the
performance by the Company of its other obligations under this Agreement and the
other Operative Documents and (xii) "roadshow" travel and other expenses
incurred in connection with the marketing and sale of the Notes.
(g) To use the proceeds from the sale of the Notes in the manner
described in the Offering Memorandum under the caption "Use of Proceeds."
(h) Not to voluntarily claim, and to resist actively any attempts
to claim, the benefit of any usury laws against the holders of any Notes.
(i) To do and perform all things required to be done and
performed under this Agreement by it prior to or after the Closing Date and to
satisfy all conditions precedent on its part to the delivery of the Notes.
(j) Not to sell, offer for sale or solicit offers to buy or
otherwise negotiate in respect of any security (as defined in the Act) that
would be integrated with the sale of the Notes in a manner that would require
the registration under the Act of the sale to the Initial Purchasers, or the
Eligible Purchasers, of the Notes or to take any other action that would result
in the Exempt Resales not being exempt from registration under the Act.
(k) For so long as any of the Notes remain outstanding and during
any period in which the Company is not subject to Section 13 or 15(d) of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), to make
available to any beneficial owner of Notes in connection with any sale thereof
and any prospective purchaser of such Notes from such beneficial owner, the
information required by Rule 144A(d)(4) under the Act.
(l) To cause the Exchange Offer to be made in the appropriate
form to permit registered Exchange Notes to be offered in exchange for the Notes
and to comply with all applicable federal and state securities laws in
connection with the Exchange Offer.
(m) To comply with all of its agreements set forth in the
Registration Rights Agreement and all agreements set forth in the representation
letters of the Company to DTC relating to the approval of the Notes by DTC for
"book-entry" transfer.
(n) To use its best efforts to obtain approval of the Notes by
DTC for "book-entry" transfer.
(o) During a period of five years following the Closing Date, to
deliver without charge to each of the Initial Purchasers, as they may reasonably
request, promptly upon their becoming available, copies of (i) all reports or
other publicly available information that the Company shall mail or otherwise
make available to its securityholders and (ii) all reports,
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financial statements and proxy or information statements filed by the Company
with the Commission or any national securities exchange and such other publicly
available information concerning the Company or its subsidiaries, if any,
including without limitation, press releases.
(p) Prior to the Closing Date, to furnish to each of the Initial
Purchasers, as soon as they have been prepared in the ordinary course by the
Company, copies of any unaudited interim financial statements for any period
subsequent to the periods covered by the financial statements appearing in the
Offering Memorandum.
(q) Not to take, directly or indirectly, any action designed to,
or that might reasonably be expected to, cause or result in stabilization or
manipulation of the price of any security of the Company to facilitate the sale
or resale of the Notes. Except as permitted by the Act, the Company will not
distribute any (i) preliminary offering memorandum, including, without
limitation, the Preliminary Offering Memorandum, (ii) offering memorandum,
including, without limitation, the Offering Memorandum, or (iii) other offering
material in connection with the offering and sale of the Notes.
(r) To perform all things required or necessary to be done and
performed under this Agreement prior to the Closing Date and to satisfy all
conditions precedent to the delivery of the Notes.
5. Representations and Warranties. (a) The Company represents and
warrants to the Initial Purchasers that:
(i) The Preliminary Offering Memorandum and the Offering
Memorandum do not, and any supplement or amendment to them will not,
contain any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary in order to
make the statements therein, in the light of the circumstances under
which they were made, not misleading, except that the
representations and warranties contained in this paragraph shall not
apply to statements in or omissions from the Preliminary Offering
Memorandum and the Offering Memorandum (or any supplement or
amendment thereto) made in reliance upon and in conformity with
information relating to the Initial Purchasers furnished to the
Company in writing by or on behalf of the Initial Purchaser
expressly for use therein. No stop order preventing the use of the
Preliminary Offering Memorandum or the Offering Memorandum, or any
amendment or supplement thereto, or any order asserting that any of
the transactions contemplated by this Agreement are subject to the
registration requirements of the Act, has been issued.
(ii) When the Notes are issued and delivered pursuant to
this Agreement, no Note will be of the same class (within the
meaning of Rule 144A under the Act) as securities of the Company
that are listed on a national securities exchange registered under
Section 6 of the Exchange Act or that are quoted in a United States
automated inter-dealer quotation system.
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(iii) The Company (A) has been duly incorporated, is
validly existing as a corporation in good standing under the laws of
its respective jurisdiction of incorporation, (B) has all requisite
corporate power and authority to carry on its business as it is
currently being conducted and as described in the Offering
Memorandum and to own, lease and operate its properties and (C) is
duly qualified and in good standing as a foreign corporation
authorized to do business in each jurisdiction in which the nature
of its business or its ownership or leasing of property requires
such qualification except, with respect to this clause (C), where
the failure of the Company to be so qualified or in good standing
does not and could not reasonably be expected to individually or in
the aggregate, result in a material adverse effect on the assets,
liabilities, business, results of operations, condition (financial
or otherwise), cash flows, affairs or prospects of the Company or on
the Company's ability to issue the Notes (a "Material Adverse
Effect").
(iv) Except as set forth on Schedule 5(iv), the Company
has no direct or indirect subsidiaries as of the Closing Date.
(v) All of the outstanding shares of capital stock of
the Company have been duly authorized and validly issued and are
fully paid and nonassessable and were not issued in violation of any
preemptive or similar rights. The Company has an authorized and
outstanding consolidated capitalization as set forth in the Offering
Memorandum under the caption "Capitalization."
(vi) Except as disclosed in the Offering Memorandum,
there are not currently, and will not be as a result of the
Offering, any outstanding subscriptions, rights, warrants, calls,
commitments of sale or options to acquire, or instruments
convertible into or exchangeable for, any capital stock or other
equity interest of the Company (collectively, "Equity Rights"). The
issuance of the Notes will not result in an adjustment to the
exercise price or number of shares issuable upon the exercise of
such Equity Rights.
(vii) The Company has all requisite corporate power and
authority to execute, deliver and perform its obligations under each
of this Agreement and the other Operative Documents and to
consummate the transactions contemplated hereby and thereby,
including, without limitation, the corporate power and authority to
issue, sell and deliver the Notes as provided herein and therein.
(viii) This Agreement has been duly and validly
authorized, executed and delivered by Company and is the legal,
valid and binding agreement of the Company, enforceable against the
Company in accordance with its terms, subject to applicable
bankruptcy, insolvency, fraudulent conveyance, reorganization or
similar laws affecting the rights of creditors generally and subject
to general principles of equity.
(ix) The Indenture has been duly and validly authorized
by the Company and, when duly executed and delivered by the Company,
will be the legal, valid and binding obligation of the Company,
enforceable against the Company in accordance with its terms,
subject to applicable bankruptcy, insolvency, fraudulent conveyance,
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reorganization or similar laws affecting the rights of creditors
generally and subject to general principles of equity. On the
Closing Date, the Indenture will conform, in all material respects,
to the requirements of the Trust Indenture Act of 1939, as amended
(the "Trust Indenture Act"), and the rules and regulations of the
Commission applicable to an indenture which is qualified thereunder.
The Offering Memorandum contains a summary of the terms of the
Indenture, which is accurate in all material respects.
(x) The Notes have been duly and validly authorized for
issuance and sale to the Initial Purchasers by the Company pursuant
to this Agreement and, when issued and authenticated in accordance
with the terms of the Indenture and delivered against payment
therefor in accordance with the terms hereof and thereof, will be
the legal, valid and binding obligations of the Company. The
description of the Notes in the Offering Memorandum is accurate in
all material respects.
(xi) The Exchange Notes have been duly and validly
authorized for issuance by the Company and, when issued and
authenticated in accordance with the terms of the Exchange Offer and
the Indenture, will be the legal, valid and binding obligations of
the Company, enforceable against the Company in accordance with
their terms and entitled to the benefits of the Indenture, subject
to applicable bankruptcy, insolvency, fraudulent conveyance,
reorganization or similar laws affecting the rights of creditors
generally and subject to general principles of equity. The
description of the Exchange Notes in the Offering Memorandum is
accurate in all material respects.
(xii) Each of the Registration Rights Agreement and the
Pledge Agreement has been duly and validly authorized by the Company
and, when duly executed and delivered by the Company, will be the
legal, valid and binding obligation of the Company. The descriptions
of the Registration Rights Agreement and the Pledge Agreement in the
Offering Memorandum are accurate in all material respects.
(xiii) The Company is not and, after giving effect to
the Offering, will not be (A) in violation of its charter or bylaws,
(B) in default in the performance of any bond, debenture, note,
indenture, mortgage, deed of trust or other agreement or instrument
to which it is a party or by which it is bound or to which any of
its properties is subject, which singly or in the aggregate, could
reasonably be expected to have a Material Adverse Effect, or (C) in
violation of any local, state, federal or foreign law, statute,
ordinance, rule, regulation, requirement, judgment or court decree
(including, without limitation, the Communications Act of 1934, as
amended by the Telecommunications Act of 1996 (the
"Telecommunications Act"), and the rules and regulations of the
Federal Communications Commission (the "FCC"), the Department of
Commerce (the "DoC"), the National Telecommunications and
Information Administration (the "NTIA") and the International
Telecommunications Union ("ITU") and environmental laws, statutes,
ordinances, rules, regulations, judgments or court decrees)
applicable to the Company or any of its assets or properties
(whether owned or leased), which singly or in the aggregate, could
reasonably be expected to have a Material Adverse Effect. To the
best
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knowledge of the Company, there exists no condition that, with
notice, the passage of time or otherwise, would constitute a default
under any such document or instrument.
(xiv) None of (A) the execution, delivery or performance
by the Company of this Agreement and the other Operative Documents,
(B) the issuance and sale of the Notes and (C) consummation by the
Company of the transactions contemplated by the Operative Documents
or the Offering Memorandum described under the captions "Use of
Proceeds" and "Related Party Transactions," violates, conflicts with
or constitutes a breach of any of the terms or provisions of, or a
default under (or an event that with notice or the lapse of time, or
both, would constitute a default), or require consent under, or
result in the imposition of a lien or encumbrance on any properties
of the Company, or an acceleration of any indebtedness of the
Company pursuant to, (i) the charter or bylaws of the Company, (ii)
any bond, debenture, note, indenture, mortgage, deed of trust or
other agreement or instrument to which the Company is a party or by
which it or its property is or may be bound, (iii) any local, state,
federal or foreign law, statute, ordinance, rule, regulation or
requirement (including, without limitation, the Telecommunications
Act and the rules and regulations of the FCC, the DoC, the NTIA and
the ITU, environmental laws, statutes, ordinances, rules or
regulations) applicable to the Company, or any of its assets or
properties or (iv) any judgment, order or decree of any court or
governmental agency or authority having jurisdiction over the
Company or any of its assets or properties. Other than as described
in the Offering Memorandum, no consent, approval, authorization or
order of, or filing, registration, qualification, license or permit
of or with, (A) any court or governmental agency, body or
administrative agency (including, without limitation, the FCC, the
DoC, the NTIA and the ITU) or (B) any other person is required for
(1) the execution, delivery and performance by the Company of this
Agreement and the other Operative Documents or (2) the issuance and
sale of the Notes and the transactions contemplated hereby and
thereby, except such as have been obtained and made on or prior to
the Closing Date (or, in the case of the Registration Rights
Agreement will be obtained and made) under the Act, the Trust
Indenture Act of 1939, as amended (the "Trust Indenture Act") and
state securities or Blue Sky laws and regulations or such as may be
required by the NASD.
(xv) There is (A) no action, suit or proceeding before
or by any court, arbitrator or governmental agency, body or
official, domestic or foreign, now pending or, to the knowledge of
the Company, threatened or contemplated to which the Company is or
may be a party or to which the business, assets or property of the
Company is subject, (B) no local, state, federal or foreign law,
statute, ordinance, rule, regulation, requirement, judgment or court
decree (including, without limitation, the Telecommunications Act
and the rules and regulations of the FCC, the DoC, the NTIA and the
ITU) or order that has been enacted, adopted or issued by any
governmental agency or that has been proposed by any governmental
body or (C) no injunction, restraining order or order of any nature
by a federal or state court or foreign court of competent
jurisdiction to which the Company is or may be subject or to which
the business, assets, or property of the Company is or may be
subject, that, in the case of clauses (A), (B) and (C) above, (1) is
required to be disclosed in the Preliminary Offering Memorandum or
the Offering
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Memorandum and that is not so disclosed, or (2) could reasonably be
expected to result in a Material Adverse Effect.
(xvi) No action has been taken and no local, state,
federal or foreign law, statute, ordinance, rule, regulation, order,
requirement, judgment or court decree has been enacted, adopted or
issued by any governmental agency that prevents the issuance of the
Notes or prevents or suspends the use of the Offering Memorandum; no
injunction, restraining order or order of any nature by a federal,
state or foreign court of competent jurisdiction has been issued
that prevents the issuance of the Notes or prevents or suspends the
sale of the Notes in any jurisdiction referred to in Section 4(e)
hereof; and the Company has complied with every request of any
securities authority or agency of any jurisdiction for additional
information.
(xvii) There is (i) no unfair labor practice complaint
pending or, to the knowledge of the Company, threatened against the
Company, before the National Labor Relations Board, or any state or
local labor relations board or any foreign labor relations board,
and no significant grievance or significant arbitration proceeding
arising out of or under any collective bargaining agreement is so
pending or, to the knowledge of the Company, threatened against the
Company, (ii) no significant strike, labor dispute, slowdown or
stoppage pending or, to the knowledge of the Company, threatened
against the Company, and (iii) no union representation question
existing with respect to the employees of the Company. To the
knowledge of the Company, no collective bargaining organizing
activities are taking place with respect to the Company. The Company
has not violated (A) any federal, state or local law or foreign law
relating to discrimination in hiring, promotion or pay of employees,
(B) any applicable wage or hour laws, or (C) any provision of the
Employee Retirement Income Security Act of 1974, as amended
("ERISA"), or the rules and regulations thereunder.
(xviii) The Company has not violated any foreign,
federal, state or local law or regulation relating to the protection
of human health and safety, the environment or hazardous or toxic
substances or wastes, pollutants or contaminants ("Environmental
Laws"), lacks any permit, license or other approval required of it
under applicable Environmental Laws, or is violating any term or
condition of such permit, license or approval which could reasonably
be expected to have a Material Adverse Effect. There is no alleged
liability or potential liability (including, without limitation,
alleged or potential liability or investigatory costs, cleanup
costs, governmental response costs, natural resource damages,
property damages, personal injuries or penalties) of the Company
arising out of, based on or resulting from (a) the presence or
release into the environment of any Hazardous Material (as defined)
at any location, whether or not owned by the Company, or (b) any
violation or alleged violation of any Environmental Law, which
alleged or potential liability is required to be disclosed in the
Offering Memorandum, other than as disclosed therein, or could
reasonably be expected to have a Material Adverse Effect. The term
"Hazardous Material" means (i) any "hazardous substance" as defined
by the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended, (ii) any "hazardous waste" as
defined by the Resource Conservation
13
and Recovery Act, as amended, (iii) any petroleum or petroleum
product, (iv) any polychlorinated biphenyl, and (v) any pollutant
or contaminant or hazardous, dangerous or toxic chemical,
material, waste or substance regulated under or within the
meaning of any other law relating to protection of human health
or the environment or imposing liability or standards of conduct
concerning any such chemical material, waste or substance.
(xix) The Company has (i) good and marketable title to
all of the properties and assets described in the Offering
Memorandum as owned by it, free and clear of all liens, charges,
encumbrances and restrictions (except for Permitted Liens and taxes
not yet payable), (ii) peaceful and undisturbed possession under all
leases to which it is a party as lessee, (iii) except as disclosed
in the Offering Memorandum, all licenses, certificates, permits,
authorizations, approvals, franchises and other rights from, and has
made all declarations and filings with, all federal, foreign, state
and local authorities (including, without limitation, the FCC, the
DoC, the NTIA and the ITU), all self-regulatory authorities and all
courts and other tribunals (each an "Authorization") necessary to
engage in the business conducted by it in the manner described in
the Offering Memorandum (including, but not limited to an FCC
license and a DoC License, or amendments thereto, with respect to
the high-resolution satellites described in the Offering
Memorandum), and (iv) no reason to believe that any governmental
body or agency is considering limiting, suspending or revoking any
such Authorization. All such Authorizations are valid and in full
force and effect and the Company is in compliance with the terms and
conditions of all such Authorizations and with the rules and
regulations of the regulatory authorities having jurisdiction with
respect thereto, except where the failure to so comply would not
have a Material Adverse Effect. All leases to which the Company is a
party are valid and binding and no default by the Company has
occurred and is continuing thereunder and no defaults by the
landlord are existing under any such lease, except such defaults
that could not reasonably be expected to have a Material Adverse
Effect.
(xx) The Company owns, possesses or has the right to
employ all patents, patent rights, intellectual property licenses,
including the OrbView-2 License and the RadarSat-2 License (each as
defined in the Offering Memorandum), inventions, copyrights,
know-how (including trade secrets and other unpatented and/or
unpatentable proprietary or confidential information, software,
systems or procedures), trademarks, service marks and trade names,
inventions, computer programs, technical data and information
(collectively, the "Intellectual Property") employed by the Company
in connection with its business, free and clear of and without
violating any right, claimed right, charge, encumbrance, pledge,
security interest, restriction or lien of any kind of any other
person, except where the failure to own, possess or have the right
to employ such Intellectual Property would not have a Material
Adverse Effect. The Company has not infringed and is not infringing
with asserted rights of others with respect to any such Intellectual
Property, except infringements that would not have a Material
Adverse Effect, and the Company has not received notice of the
infringement of asserted rights of others with respect to any such
Intellectual Property.
14
(xxi) None of the Company or any of its officers,
directors, partners, employees, agents or affiliates or any other
person acting on behalf of the Company, has, directly or indirectly,
given or agreed to give any money, gift or similar benefit (other
than legal price concessions to customers in the ordinary course of
business) to any customer, supplier, employee or agent of a customer
or supplier, official or employee of any governmental agency
(domestic or foreign), instrumentality of any government (domestic
or foreign) or any political party or candidate for office (domestic
or foreign) or other person who was, is or may be in a position to
help or hinder the business of the Company (or assist the Company in
connection with any actual or proposed transaction) which (i) might
subject the Company, or any other individual or entity to any damage
or penalty in any civil, criminal or governmental litigation or
proceeding (domestic or foreign), (ii) if not given in the past,
could reasonably be expected to have had a Material Adverse Effect
on the assets, business or operations of the Company or (iii) if not
continued in the future, could reasonably be expected to have a
Material Adverse Effect.
(xxii) All material tax returns required to be filed by
the Company in all jurisdictions have been so filed. All taxes,
including withholding taxes, penalties and interest, assessments,
fees and other charges due or claimed to be due from such entities
or that are due and payable have been paid, except to the extent
such taxes are (A) currently payable without penalty or interest or
(B) being contested in good faith and for which adequate reserves
have been provided. To the knowledge of the Company, there are no
material proposed additional tax assessments against the Company or
the assets or property of the Company.
(xxiii) The Company is not, and after giving effect to
the Offering will not be, an "investment company" or a company
"controlled" by an "investment company" within the meaning of the
Investment Company Act of 1940, as amended (the "Investment Company
Act").
(xxiv) There are no holders of securities of the Company
who, by reason of the execution by the Company of this Agreement or
any other Operative Document to which it is a party or the
consummation by the Company of the transactions contemplated hereby
and thereby, have the right to request or demand that the Company
register any of its securities under the Act or analogous foreign
laws and regulations.
(xxv) The Company maintains a system of internal
accounting controls sufficient to provide reasonable assurance that:
(i) transactions are executed in accordance with management's
general or specific authorizations; (ii) transactions are recorded
as necessary to permit preparation of financial statements in
conformity with generally accepted accounting principles and to
maintain accountability for assets; (iii) access to assets is
permitted only in accordance with management's general or specific
authorization; and (iv) the recorded accountability for assets is
compared with the existing assets at reasonable intervals and
appropriate action is taken with respect thereto.
15
(xxvi) The Company maintains insurance covering its
properties, operations, personnel and businesses, and will maintain
insurance as required by the Indenture. Such insurance insures
against such losses and risks as are consistent with industry
practice to protect the Company and its business. The Company has
not received notice from any insurer or agent of such insurer that
substantial capital improvements or other expenditures will have to
be made in order to continue such insurance. All such insurance is
outstanding and duly in force on the date hereof.
(xxvii) The Company has not (i) taken, directly or
indirectly, any action designed to, or that might reasonably be
expected to, cause or result in stabilization or manipulation of the
price of any security of the Company to facilitate the sale or
resale of the Notes or (ii) since the date of the Preliminary
Offering Memorandum (A) sold, bid for, purchased or paid any person
any compensation for soliciting purchases of the Notes or (B) paid
or agreed to pay to any person any compensation for soliciting
another to purchase any other securities of the Company.
(xxviii) No registration under the Act of the Notes is
required for the sale of the Notes to the Initial Purchasers as
contemplated hereby or for the Exempt Resales assuming (i) that the
purchasers who buy the Notes in the Exempt Resales are either
Eligible Purchasers and (ii) the accuracy of the Initial Purchasers'
representations regarding the absence of general solicitation in
connection with the sale of Notes to the Initial Purchasers and the
Exempt Resales contained herein. No form of general solicitation or
general advertising was used by the Company or any of its
representatives (other than the Initial Purchasers, as to which the
Company makes no representation or warranty) in connection with the
offer and sale of any of the Notes in connection with Exempt
Resales, including, but not limited to, articles, notices or other
communications published in any newspaper, magazine, or similar
medium or broadcast over television or radio, or any seminar or
meeting whose attendees have been invited by any general
solicitation or general advertising. No securities of the same class
as the Notes have been issued and sold by the Company within the
six-month period immediately prior to the date hereof.
(xxix) Except as set forth on Schedule 5(xxix), there
are no employee pension or benefit plans with respect to which the
Company or any corporation considered an affiliate of the Company
within the meaning of Section 407(d)(7) of ERISA (an "ERISA
Affiliate") is a party in interest or disqualified person. The
execution and delivery of this Agreement, the other Operative
Documents and the sale of the Notes to be purchased by the Eligible
Purchasers will not involve any prohibited transaction within the
meaning of Section 406 of ERISA or Section 4975 of the Internal
Revenue Code of 1986. The representation made by the Company in the
preceding sentence is made in reliance upon and subject to the
accuracy of, and compliance with, the representations and covenants
made or deemed made by the Eligible Purchasers, as set forth in the
Offering Memorandum under the caption "Notice to Investors."
16
(xxx) Each of the Preliminary Offering Memorandum and
the Offering Memorandum, as of its date, and each amendment or
supplement thereto, as of its date, contains the information
specified in, and meets the requirements of, Rule 144A(d)(4) under
the Act.
(xxxi) Subsequent to the respective dates as of which
information is given in the Offering Memorandum and up to the
Closing Date, and except as set forth in the Offering Memorandum,
(A) the Company has not entered into any amendment to or agreed to
any modification of the Orbital Agreements, the Stock Purchase
Agreement or the Stockholders' Agreement, (B) the Company has not
incurred any liabilities or obligations, direct or contingent, which
are or will be material, individually or in the aggregate, to the
Company, nor entered into any transaction not in the ordinary course
of business, (C) there has not been, singly or in the aggregate, any
change or development which could reasonably be expected to result
in a Material Adverse Effect, and (D) there has been no dividend or
distribution of any kind declared, paid or made by the Company on
any class of capital stock.
(xxxii) None of the execution, delivery and performance
of this Agreement, the issuance and sale of the Notes, the
application of the proceeds from the issuance and sale of the Notes
and the consummation of the transactions contemplated thereby as set
forth in the Offering Memorandum, will violate Regulations G, T, U
or X promulgated by the Board of Governors of the Federal Reserve
System or analogous foreign laws and regulations.
(xxxiii) The accountants who have certified or will
certify the financial statements included or to be included as part
of the Offering Memorandum are independent accountants as required
by the Act. The historical financial statements of the Company,
together with related notes thereto, comply as to form with the
requirements applicable to registration statements on Form S-4 under
the Act, and the historical financial statements of the Company
present fairly the financial position and results of operations of
the Company at the dates and for the periods indicated. Such
financial statements have been prepared in accordance with generally
accepted accounting principles applied on a consistent basis
throughout the periods presented except as noted therein. The other
financial and statistical information and data included in the
Offering Memorandum derived from the historical financial statements
are accurately presented and prepared on a basis consistent with the
historical financial statements included in the Offering Memorandum
and the books and records of the Company.
(xxxiv) The Company does not intend to, nor does it
believe that it will, incur debts beyond its ability to pay such
debts as they mature. Upon the issuance of the Notes, the present
fair saleable value of the assets of the Company will exceed the
amount that will be required to be paid on or in respect of the
existing debts and other liabilities (including contingent
liabilities) of the Company as they become absolute and matured.
Upon the issuance of the Notes, the assets of the Company will not
constitute unreasonably small capital to carry out its businesses as
now conducted, including the
17
capital needs of the Company, taking into account the projected
capital requirements and capital availability.
(xxxv) Except pursuant to this Agreement, there are no
contracts, agreements or understandings between the Company and any
other person that would give rise to a valid claim against the
Company or either of the Initial Purchasers for a brokerage
commission, finder's fee or like payment in connection with the
issuance, purchase and sale of the Notes.
(xxxvi) The Company has complied with all provisions of
Section 517.075, Florida Statutes, relating to doing business with
the Government of Cuba or with any affiliate located in Cuba.
(xxxvii) There exist no conditions that would constitute
a default (or an event which with notice or the lapse of time, or
both, would constitute a default) under any of the Operative
Documents or any of the documents relating to the Series A Preferred
Stock.
(xxxviii) Except as disclosed in the Offering
Memorandum, there are no business relationships or related party
transactions required to be disclosed therein pursuant to Item 404
of Regulation S-K of the Commission (assuming for purposes of this
subparagraph that Regulation S-K is applicable to the Offering
Memorandum).
(xxxix) It is not necessary in connection with the
offer, sale and delivery of the Notes to the Initial Purchasers and
to each subsequent purchaser in the manner contemplated by this
Agreement and the Offering Memorandum to qualify the Indenture under
the Trust Indenture Act of 1939, as amended.
(xl) Each certificate signed by any officer of the
Company and delivered to the Initial Purchasers or counsel for the
Initial Purchasers pursuant to this Agreement shall be deemed to be
a representation and warranty by the Company to the Initial
Purchasers as to the matters covered thereby.
(xli) The data relating to market size included in the
Offering Memorandum is based on or derived from sources that the
Company believes to be reliable and accurate in all material
respects.
The Company acknowledges that each of the Initial Purchasers and,
for purposes of the opinions to be delivered to the Initial Purchasers pursuant
to Section 8 hereof, counsel to the Company and counsel to the Initial
Purchasers, will rely upon the accuracy and truth of the foregoing
representations and hereby consents to such reliance.
(b) Each of the Initial Purchasers, severally and not
jointly, represents, warrants and covenants to the Company and agrees that:
18
(i) Nature of Initial Purchasers; Offers and Sales only
to Qualified Institutional Buyers. Each Initial Purchaser is (i) a "qualified
institutional buyer" within the meaning of Rule 144A under the 1933 Act and (ii)
an "accredited investor" within the meaning of Rule 501(a) under the 1933 Act.
Offers and sales of the Notes shall be made only to Eligible Purchasers. Each
Initial Purchaser agrees that it will not offer, sell or deliver any of the
Notes in any jurisdiction outside the United States except under circumstances
that will result in compliance with the applicable laws thereof, and that it
will take at its own expense whatever action is required to permit its purchase
and resale of the Notes in such jurisdictions.
(ii) No General Solicitation. No general solicitation
or general advertising (within the meaning of Rule 502(c) under the 1933 Act)
will be used in the United States in connection with the offering or sale of
the Notes.
(iii) Purchases by Non-Bank Fiduciaries. In the case of
a non-bank Eligible Purchaser of a Note acting as a fiduciary for one or more
third parties, each third party shall, in the judgment of the applicable Initial
Purchaser, be an Eligible Purchaser.
(iv) Subsequent Purchaser Notification. Each Initial
Purchaser will take reasonable steps to inform, and cause each of its U.S.
affiliates to take reasonable steps to inform, persons acquiring Notes from such
Initial Purchaser or affiliate, as the case may be, in the United States that
the Notes (A) have not been and will not be registered under the Securities Act,
(B) are being sold to them without registration under the Securities Act in
reliance on Rule 144A or in accordance with another exemption from registration
under the Securities Act, as the case may be, and (C) may not be offered, sold
or otherwise transferred except (1) to the Company, (2) outside the United
States in accordance with Regulation S or (3) inside the United States in
accordance with (x) Rule 144A to a person whom the Seller reasonably believes is
a QIB that is purchasing such Notes for its own account or for the account of a
QIB to whom notice is given that the offer, sale or transfer is being made in
reliance on Rule 144A or (y) pursuant to another available exemption from
registration under the 1933 Act.
(v) Minimum Principal Amount. No sale of the Notes to
any one Eligible Purchaser will be for less than U.S. $100,000 principal amount
and no Note will be issued in a smaller principal amount. If the Eligible
Purchaser is a non-bank fiduciary acting on behalf of others, each of the
persons for whom it is acting must purchase at least U.S. $100,000 principal
amount of the Notes.
(vi) Restrictions on Transfer. The transfer
restrictions and the other provisions set forth in the Offering Memorandum
under the heading "Notice to Investors," including the legend required thereby,
shall apply to the Notes except as otherwise agreed by the Company and the
Initial Purchasers.
(vii) Delivery of Offering Memorandum. Each Initial
Purchaser will deliver to each purchaser of the Notes from such Initial
Purchaser, in connection with its original distribution of the Notes, a copy of
the Offering Memorandum, as amended and supplemented at the date of such
delivery.
19
The Initial Purchasers understand that the Company and, for purposes
of the opinions to be delivered to the Initial Purchasers pursuant to Section 8
hereof, counsel for the Company and counsel for the Initial Purchasers, will
rely upon the accuracy and truth of the foregoing representations and hereby
consent to such reliance.
6. Indemnification.
(a) The Company agrees to indemnify and hold harmless
(i) each of the Initial Purchasers, (ii) each person, if any, who controls
either of the Initial Purchasers within the meaning of Section 15 of the Act or
Section 20(a) of the Exchange Act and (iii) the respective officers, directors,
partners, employees, representatives and agents of each of the Initial
Purchasers or any controlling person to the fullest extent lawful, from and
against any and all losses, liabilities, claims, damages and expenses whatsoever
(including but not limited to reasonable attorneys' fees and any and all
reasonable expenses whatsoever incurred in investigating, preparing or defending
against any investigation or litigation, commenced or threatened, or any claim
whatsoever, and any and all amounts paid in settlement of any claim or
litigation), joint or several, to which they or any of them may become subject
under the Act, the Exchange Act or otherwise, insofar as such losses,
liabilities, claims, damages or expenses (or actions in respect thereof) arise
out of or are based upon any untrue statement or alleged untrue statement of a
material fact contained in the Preliminary Offering Memorandum or the Offering
Memorandum, or in any supplement thereto or amendment thereof, or arise out of
or are based upon the omission or alleged omission to state therein a material
fact required to be stated therein or necessary to make the statements therein,
in the light of the circumstances under which they were made, not misleading;
provided, however, that the Company will not be liable in any such case to the
extent, but only to the extent, that any such loss, liability, claim, damage or
expense arises out of or is based upon any such untrue statement or alleged
untrue statement or omission or alleged omission made therein in reliance upon
and in conformity with information relating to either of the Initial Purchasers
furnished to the Company in writing by or on behalf of such Initial Purchaser
expressly for use therein; provided, further, that such indemnity with respect
to the Preliminary Offering Memorandum shall not inure to the benefit of either
Initial Purchaser (or any persons controlling such Initial Purchaser) from whom
the person asserting such loss, claim, damage or liability purchased the Notes
which are the subject thereof if such person did not receive a copy of the
Offering Memorandum (or the Offering Memorandum as amended or supplemented) at
or prior to the confirmation of the sale of such Notes to such person (and the
Offering Memorandum or any such amended or supplemented Offering Memorandum, as
applicable, shall have been delivered by the Company to such Initial Purchaser a
reasonable amount of time prior to the mailing or delivery, as applicable, of
such confirmation) and any such untrue statement or omission or alleged untrue
statement or omission of a material fact contained in such Preliminary Offering
Memorandum was corrected in the Offering Memorandum (or the Offering Memorandum
as amended or supplemented). This indemnity agreement will be in addition to any
liability which the Company may otherwise have, including under this Agreement.
20
(b) Each of the Initial Purchasers, severally and not
jointly, agrees to indemnify and hold harmless (i) the Company, (ii) each
person, if any, who controls the Company within the meaning of Section 15 of the
Act or Section 20(a) of the Exchange Act, and (iii) the officers, directors,
partners, employees, representatives and agents of the Company against any
losses, liabilities, claims, damages and expenses whatsoever (including but not
limited to reasonable attorneys' fees and any and all expenses whatsoever
incurred in investigating, preparing or defending against any investigation or
litigation, commenced or threatened, or any claim whatsoever and any and all
amounts paid in settlement of any claim or litigation), joint or several, to
which they or any of them may become subject under the Act, the Exchange Act or
otherwise, insofar as such losses, liabilities, claims, damages or expenses (or
actions in respect thereof) arise out of or are based upon any untrue statement
or alleged untrue statement of a material fact contained in the Preliminary
Offering Memorandum or the Offering Memorandum, or in any amendment thereof or
supplement thereto, or arise out of or are based upon the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading, in each case to the extent, but only
to the extent, that any such loss, liability, claim, damage or expense arises
out of or is based upon any untrue statement or alleged untrue statement or
omission or alleged omission made therein in reliance upon and in conformity
with information relating to such Initial Purchaser furnished to the Company in
writing by or on behalf of such Initial Purchaser expressly for use therein;
provided, however, that in no case shall either of the Initial Purchasers be
liable or responsible for any amount in excess of the discounts and commissions
received by such Initial Purchaser, as set forth on the cover page of the
Offering Memorandum.
(c) Promptly after receipt by an indemnified party under
subsection (a) or (b) above of notice of the commencement of any
action, such indemnified party shall, if a claim in respect thereof is to be
made against the indemnifying party under such subsection, notify each party
against whom indemnification is to be sought in writing of the commencement
thereof (but the failure so to notify an indemnifying party shall not relieve it
from any liability which it may have under this Section 6 except to the extent
that it has been prejudiced in any material respect by such failure or from any
liability which it may otherwise have). In case any such action is brought
against any indemnified party, and it notifies an indemnifying party of the
commencement thereof, the indemnifying party will be entitled to participate
therein, and to the extent it may elect by written notice delivered to the
indemnified party promptly after receiving the aforesaid notice from such
indemnified party, to assume the defense thereof with counsel reasonably
satisfactory to such indemnified party. Notwithstanding the foregoing, the
indemnified party or parties shall have the right to employ its or their own
counsel in any such case, but the fees and expenses of such counsel shall be at
the expense of such indemnified party or parties unless (i) the employment of
such counsel shall have been authorized in writing by the indemnifying parties
in connection with the defense of such action, (ii) the indemnifying parties
shall not have employed counsel to take charge of the defense of such action
within a reasonable time after notice of commencement of the action, or (iii)
such indemnified party or parties shall have reasonably concluded that there may
be defenses available to it or them which are different from or additional to
those available to one or all of the indemnifying parties (in which case the
indemnifying party or parties shall not have the right to direct the defense of
such action on
21
behalf of the indemnified party or parties), in any of which events such fees
and expenses of counsel shall be borne by the indemnifying parties; provided,
however, that the indemnifying party under subsection (a) or (b) above shall
only be liable for the legal expenses of one counsel (in addition to any local
counsel) for all indemnified parties in each jurisdiction in which any claim or
action is brought. Anything in this subsection to the contrary notwithstanding,
an indemnifying party shall not be liable for any settlement of any claim or
action effected without its prior written consent, provided that such consent
was not unreasonably withheld.
7. Contribution. In order to provide for contribution in
circumstances in which the indemnification provided for in Section 6 is for any
reason held to be unavailable to or is insufficient to hold harmless a party
indemnified thereunder, each indemnifying party shall contribute to the
aggregate losses, claims, damages, liabilities and expenses of the nature
contemplated by such indemnification provision (including any investigation,
legal and other expenses reasonably incurred in connection with, and any amount
paid in settlement of, any action, suit or proceeding or any claims asserted,
but after deducting in the case of losses, claims, damages, liabilities and
expenses suffered by the Company, any contribution received by the Company from
persons, other than the Initial Purchasers, who may also be liable for
contribution, including persons who control the Company within the meaning of
Section 15 of the Act or Section 20(a) of the Exchange Act) to which the Company
and such Initial Purchaser may be subject, in such proportion as is appropriate
to reflect the relative benefits received by the Company, on one hand, and such
Initial Purchaser, on the other hand, from the offering of the Notes or, if such
allocation is not permitted by applicable law or indemnification is not
available as a result of the indemnifying party not having received notice as
provided in Section 6, in such proportion as is appropriate to reflect not only
the relative benefits referred to above but also the relative fault of the
Company, on one hand, and such Initial Purchaser, on the other hand, in
connection with the statements or omissions which resulted in such losses,
claims, damages, liabilities or expenses, as well as any other relevant
equitable considerations. The relative benefits received by the Company, on one
hand, and each Initial Purchaser, on the other hand, shall be deemed to be in
the same proportion as (i) the total proceeds from the offering of Notes (net of
discounts but before deducting expenses) received by the Company and (ii) the
discounts and commissions received by such Initial Purchaser, respectively, as
set forth on the cover page of the Offering Memorandum. The relative fault of
the Company, on one hand, and of each Initial Purchaser, on the other hand,
shall be determined by reference to, among other things, whether the untrue or
alleged untrue statement of a material fact or the omission or alleged omission
to state a material fact relates to information supplied by the Company or such
Initial Purchaser and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
The Company and the Initial Purchasers agree that it would not be just and
equitable if contribution pursuant to this Section 7 were determined by pro rata
allocation or by any other method of allocation which does not take into account
the equitable considerations referred to above. Notwithstanding the provisions
of this Section 7, (i) in no case shall either of the Initial Purchasers be
required to contribute any amount in excess of the amount by which the discounts
and commissions applicable to the Notes purchased by such Initial Purchaser
pursuant to this Agreement exceeds the amount of any damages which such Initial
Purchaser has otherwise been required to pay by reason of any untrue or alleged
untrue statement or omission or alleged omission and (ii) no person guilty of
fraudulent
22
misrepresentation (within the meaning of Section 11(f) of the Act) shall be
entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation. For purposes of this Section 7, (A) each person, if any, who
controls either of the Initial Purchasers within the meaning of Section 15 of
the Act or Section 20(a) of the Exchange Act and (B) the respective officers,
directors, partners, employees, representatives and agents of each of the
Initial Purchasers or any controlling person shall have the same rights to
contribution as such Initial Purchaser, and (A) each person, if any, who
controls the Company within the meaning of Section 15 of the Act or Section
20(a) of the Exchange Act and (B) the respective officers, directors, partners,
employees, representatives and agents of the Company shall have the same rights
to contribution as the Company, subject in each case to clauses (i) and (ii) of
this Section 7. Any party entitled to contribution will, promptly after receipt
of notice of commencement of any action, suit or proceeding against such party
in respect of which a claim for contribution may be made against another party
or parties under this Section 7, notify such party or parties from whom
contribution may be sought, but the failure to so notify such party or parties
shall not relieve the party or parties from whom contribution may be sought from
any obligation it or they may have under this Section 7 or otherwise. No party
shall be liable for contribution with respect to any action or claim settled
without its prior written consent, provided that such written consent was not
unreasonably withheld.
8. Conditions of Initial Purchasers' Obligations. The obligations of
the Initial Purchasers to purchase and pay for the Notes, as provided herein,
shall be subject to the satisfaction of the following conditions:
(a) All of the representations and warranties of the Company
contained in this Agreement shall be true and correct on the date hereof and on
the Closing Date with the same force and effect as if made on and as of the date
hereof and the Closing Date, respectively. The Company shall have performed or
complied with all of the agreements herein contained and required to be
performed or complied with by it at or prior to the Closing Date.
(b) The Offering Memorandum shall have been printed and copies
distributed to the Initial Purchasers as promptly as practicable on the day
following the date of this Agreement or at such later date and time as to which
the Initial Purchasers may agree, and no stop order suspending the qualification
or exemption from qualification of the Notes in any jurisdiction referred to in
Section 4(e) shall have been issued and no proceeding for that purpose shall
have been commenced or shall be pending or threatened.
(c) No action shall have been taken and no statute, rule,
regulation or order shall have been enacted, adopted or issued by any
governmental agency which would, as of the Closing Date, prevent the issuance of
the Notes; no action, suit or proceeding shall have been commenced and be
pending or threatened against or affecting the Company before any court or
arbitrator or any governmental body, agency or official that, if adversely
determined, would result in a Material Adverse Effect; and no stop order shall
have been issued preventing the use of the Offering Memorandum, or any amendment
or supplement thereto, or which could reasonably be expected have a Material
Adverse Effect on the Company.
23
(d) Since the dates as of which information is given in the
Offering Memorandum, (i) there shall not have been any material adverse change,
or any development that is reasonably likely to result in a material adverse
change, in the capital stock or the long-term debt, or increase in the
short-term debt, of the Company from that set forth in the Offering Memorandum,
(ii) no dividend or distribution of any kind shall have been declared, paid or
made by the Company on any class of its capital stock, and (iii) the Company
shall not have incurred any liabilities or obligations, direct or contingent,
that are material, individually or in the aggregate, to the Company, and that
are required to be disclosed on a balance sheet or notes thereto in accordance
with generally accepted accounting principles and are not disclosed on the
latest balance sheet or notes thereto included in the Offering Memorandum. Since
the date hereof and since the dates as of which information is given in the
Offering Memorandum, there shall not have occurred any Material Adverse Effect.
(e) The Initial Purchasers shall have received certificates,
dated the Closing Date, signed on behalf of the Company, in form and substance
satisfactory to the Initial Purchasers, confirming, as of the Closing Date, the
matters set forth in paragraphs (a), (b), (c) and (d) of this Section 8 and
that, as of the Closing Date, the obligations of the Company to be performed
hereunder on or prior thereto have been duly performed.
(f) The Initial Purchasers shall have received on the Closing
Date an opinion, dated the Closing Date, (i) of Latham & Watkins, counsel for
the Company and (ii) of Alan Schwartz Ocio, Esquire, Vice President and General
Counsel for the Company; each in form and substance satisfactory to the Initial
Purchasers and counsel for the Initial Purchasers, covering such matters as are
customarily covered in such opinions.
(g) The Initial Purchasers shall have received on the Closing
Date an opinion, dated the Closing Date, of Halprin, Temple, Goodman and Maher,
in form and substance satisfactory to the Initial Purchasers and counsel for the
Initial Purchasers, covering such matters as are customarily covered in such
opinions.
(h) At the time this Agreement is executed and at the Closing
Date, the Initial Purchasers shall have received from KPMG, independent public
accountants, dated as of the date of this Agreement and as of the Closing Date,
customary comfort letters addressed to the Initial Purchasers and in form and
substance satisfactory to the Initial Purchasers and counsel for the Initial
Purchasers with respect to the financial statements and certain financial
information of the Company contained in the Offering Memorandum and/or
incorporated therein by reference.
(i) The Initial Purchasers shall have received an opinion, dated
the Closing Date, in form and substance reasonably satisfactory to the Initial
Purchasers, of Fried, Frank, Harris, Shriver & Jacobson, counsel for the Initial
Purchasers, covering such matters as are customarily covered in such opinions.
(j) Fried, Frank, Harris, Shriver & Jacobson shall have been
furnished with such documents, in addition to those set forth above, as they may
reasonably require for the purpose of enabling them to review or pass upon the
matters referred to in this Section 8 and in
24
order to evidence the accuracy, completeness or satisfaction of any of the
representations, warranties or conditions herein contained.
(k) Prior to the Closing Date, the Company shall have furnished
to the Initial Purchasers such further information, certificates and documents
as the Initial Purchasers may reasonably request.
(l) The Company and the Trustee shall have entered into the
Indenture and the Initial Purchasers shall have received counterparts, conformed
as executed, thereof.
(m) The Company shall have entered into the Registration Rights
Agreement and the Initial Purchasers shall have received counterparts, conformed
as executed, thereof.
(n) The Company shall have entered into the Pledge Agreement and
the Initial Purchasers shall have received counterparts, conformed as executed,
thereof.
(o) The Company shall have given irrevocable instructions to
purchase the Pledged Securities and deposit the Pledged Securities into the
Pledge Account, and the Initial Purchasers shall have received the written
opinion of a firm of nationally recognized independent certified accountants, in
form and substance satisfactory to the Initial Purchasers, to the effect that
the Pledged Securities, upon receipt of scheduled interest and principal
payments thereon, are sufficient to provide for the payment in full of the first
two scheduled interest payments due on the Notes.
(p) There shall not have been any announcement by any "nationally
recognized statistical rating organization," as defined for purposes of Rule
463(g) under the Securities Act, that (i) it is downgrading its rating assigned
to any class of securities of the Company or (ii) it is reviewing its rating
assigned to any class of securities of the Company with a view to possible
downgrading, or with negative implications, or direction not determined.
(q) The Notes shall have been approved for trading on PORTAL.
All opinions, certificates, letters and other documents required by
this Section 8 to be delivered by the Company will be in compliance with the
provisions hereof only if they are satisfactory in form and substance to the
Initial Purchasers. The Company shall furnish the Initial Purchasers with such
conformed copies of such opinions, certificates, letters and other documents as
they shall reasonably request.
9. Initial Purchasers' Information. The Company acknowledges that
the statements with respect to the offering of the Notes set forth in the last
paragraph on page ii of the Offering Memorandum and in the fifth paragraph under
the caption "Plan of Distribution" in the Offering Memorandum constitute the
only information relating to any of the Initial Purchasers furnished to the
Company in writing by or on behalf of any of the Initial Purchasers expressly
for use in the Offering Memorandum.
25
10. Survival of Representations and Agreements. All representations
and warranties, covenants and agreements of the Initial Purchasers and the
Company contained in this Agreement, including the agreements contained in
Sections 4(f) and 11(d), the indemnity agreements contained in Section 6 and the
contribution agreements contained in Section 7, shall remain operative and in
full force and effect regardless of any investigation made by or on behalf of
either of the Initial Purchasers, any controlling person thereof, or by or on
behalf of the Company or any controlling person thereof, and shall survive
delivery of and payment for the Notes to and by the Initial Purchasers. The
representations contained in Section 5 and the agreements contained in Sections
4(f), 6, 7 and 11(d) shall survive the termination of this Agreement, including
any termination pursuant to Section 11.
11. Effective Date of Agreement; Termination.
(a) This Agreement shall become effective upon execution and
delivery of a counterpart hereof by each of the parties hereto.
(b) The Initial Purchasers shall have the right to terminate
this Agreement at any time prior to the Closing Date by notice to the Company
from the Initial Purchasers, without liability (other than with respect to
Sections 6 and 7) on the Initial Purchasers' part to the Company if, on or prior
to such date, (i) the Company shall have failed, refused or been unable to
perform any agreement in any material respect on their part to be performed
hereunder, (ii) any other condition to the obligations of the Initial Purchasers
hereunder as provided in Section 8 is not fulfilled when and as required in any
material respect, (iii) in the reasonable judgment of the Initial Purchasers,
any Material Adverse Effect shall have occurred since the respective dates as of
which information is given in the Offering Memorandum, other than as set forth
in the Offering Memorandum, or (iv)(A) any domestic or international event or
act or occurrence has disrupted, or in the opinion of the Initial Purchasers
will in the immediate future materially disrupt, the market for the Company's
securities or for securities in general; (B) trading in securities generally on
the New York or American Stock Exchange, or the Nasdaq National Market, shall
have been suspended or materially limited, or minimum or maximum prices for
trading shall have been established, or maximum ranges for prices for securities
shall have been required, on such exchange, or by such exchange or other
regulatory body or governmental authority having jurisdiction; (C) a banking
moratorium shall have been declared by federal or state authorities, or a
moratorium in foreign exchange trading by major international banks or persons
shall have been declared; (D) there is an outbreak or escalation of armed
hostilities involving the United States on or after the date hereof, or if there
has been a declaration by the United States of a national emergency or war, the
effect of which shall be, in the Initial Purchasers' reasonable judgment, to
make it inadvisable or impracticable to proceed with the offering or delivery of
the Notes on the terms and in the manner contemplated in the Offering
Memorandum; or (E) there shall have been such a material adverse change in
general economic, political or financial conditions or if the effect of
international conditions on the financial markets in the United States shall be
such as, in the Initial Purchasers' reasonable judgment, makes it inadvisable or
impracticable to proceed with the delivery of the Notes as contemplated hereby.
26
(c) Any notice of termination pursuant to this Section 11 shall
be by telephone or telephonic facsimile and, in either case, confirmed in
writing by letter.
(d) If this Agreement shall be terminated pursuant to any of the
provisions hereof (otherwise than pursuant to clause (iii) or (iv) of Section
11(b), in which case each party will be responsible for its own expenses), the
Company shall reimburse the Initial Purchasers for all out-of-pocket expenses
(including the reasonable fees and expenses of the Initial Purchasers' counsel),
reasonably incurred by the Initial Purchasers in connection herewith.
12. Notice. All communications hereunder, except as may be otherwise
specifically provided herein, shall be mailed, delivered, telecopied and
confirmed in writing or sent by a nationally recognized overnight courier
service guaranteeing delivery on the next business day to, as follows:
if to the Initial Purchasers:
Bear, Stearns & Co. Inc.
245 Park Avenue, New York, NY 10167
Attention: Corporate Finance Department
Telecopy number: (212) 272-3092
with a copy to:
Fried, Frank, Harris, Shriver & Jacobson
1001 Pennsylvania Avenue, N.W., Suite 800
Washington, DC 20004
Attention: Stephen I. Glover
Telecopy number: (202) 639-7008
if to the Company:
Orbital Imaging Corporation
21700 Atlantic Boulevard, Dulles, VA 20166
Attention: Alan Schwartz Ocio, Vice President and
General Counsel
Telecopy number: (703) 406-5552
with a copy to:
Latham & Watkins
1001 Pennsylvania Ave., N.W, Suite 1300
Washington, DC 20004
Attention: Michael A. Bell
Telecopy number: (202) 637-2201.
27
13. Parties. This Agreement shall inure solely to the benefit of,
and shall be binding upon, the Initial Purchasers and the Company and the
controlling persons and agents referred to in Sections 6 and 7, and their
respective successors and assigns, and no other person shall have or be
construed to have any legal or equitable right, remedy or claim under or in
respect of or by virtue of this Agreement or any provision herein contained. The
term "successors and assigns" shall not include a purchaser, in its capacity as
such, of Notes from the Initial Purchasers.
14. Construction. This Agreement shall be construed in accordance
with the internal laws of the State of New York. TIME IS OF THE ESSENCE IN THIS
AGREEMENT.
15. Captions. The captions included in this Agreement are included
solely for convenience of reference and are not to be considered a part of this
Agreement.
16. Counterparts. This Agreement may be executed in various
counterparts which together shall constitute one and the same instrument.
[Signature Page to Follow]
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If the foregoing correctly sets forth the understanding among the
Initial Purchasers and the Company please so indicate in the space provided
below for that purpose, whereupon this letter shall constitute a binding
agreement among us.
Very truly yours,
ORBITAL IMAGING CORPORATION
By:
----------------------------
Name:
Title:
Accepted and agreed to as of
the date first above written:
BEAR, STEARNS & CO. INC.
By:
----------------------
Name:
Title:
MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
By:
---------------------
Name:
Title:
29
SCHEDULE I
Bear, Stearns & Co. Inc..............................................$52,500,000
Merrill Lynch, Pierce, Fenner & Smith
Incorporated.............................................$22,500,000
30
SCHEDULE 5(iv)
WeatherSat International Corp., a New Hampshire corporation
31
SCHEDULE 5(xxix)
401(k) plan