1
DRAFT 5/30/97
IRIDIUM WORLD COMMUNICATIONS LTD.
(a Bermuda company)
2,000,000 Shares of Class A Common Stock
INTERNATIONAL PURCHASE AGREEMENT
Dated: __________, 1997
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TABLE OF CONTENTS
Page
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INTERNATIONAL PURCHASE AGREEMENT 1
SECTION 1. Representations and Warranties 4
(a) Representations and Warranties by the Company and Iridium 4
(i) Compliance with Registration Requirements 4
(ii) Independent Accountants 5
(iii) Financial Statements 5
(iv) No Material Adverse Change in Business 6
(v) Good Standing of the Company and Iridium 6
(vi) No Significant Subsidiary 6
(vii) Capitalization 6
(viii) Authorization of Agreement 7
(ix) Authorization and Description of Securities 7
(x) Absence of Defaults and Conflicts 8
(xi) Absence of Labor Dispute 9
(xii) Absence of Proceedings 9
(xiii) Accuracy of Exhibits 9
(xiv) Possession of Intellectual Property 9
(xv) Absence of Further Requirements 9
(xiv) Possession Licenses and Permits 10
(xvii) Title to Property 10
(xviii) Compliance with Cuba Act 11
(xix) Investment Company Act 11
(xx) Environmental Laws 11
(xxi) Registration Rights 11
(xxii) Principal Agreements 11
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(xxiii) Governance Agreements 12
(xxiv) FCC License 13
(xxv) Forward Looking Statements 13
(xxvi) Certain Descriptions 13
(xxvii) Accounting Controls 13
(b) Officer's Certificates 14
SECTION 2. Sale and Delivery to International Managers; Closing 14
(a) Initial Securities 14
(b) Option Securities 14
(c) Payment 14
(d) Denominations; Registration 15
SECTION 3. Covenants of the Company 15
(a) Compliance with Securities Regulations and Commission Requests 15
(b) Filing of Amendments 16
(c) Delivery of Registration Statements 16
(d) Delivery of Prospectuses 16
(e) Continued Compliance with Securities Laws 17
(f) Blue Sky Qualifications 17
(g) Rule 158 17
(h) Use of Proceeds 18
(i) Listing 18
(j) Restriction on Sale of Securities 18
(k) Reporting Requirements 18
(l) Compliance with NASD Rules 18
[(m) Compliance with Rule 463 19
(n) Exchange Agreement 19
SECTION 4. Covenants of Iridium 00
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(x) Xxxxxxxx Xxxxxxxxx 00
(x) Use of Proceeds 19
SECTION 5. Payment of Expenses 19
(a) Expenses 19
(b) Termination of Agreement 20
SECTION 6. Conditions of International Managers' Obligations 20
(a) Effectiveness of Registration Statement 20
(b) Letter and Opinion of Counsel for Company and Iridium 20
(c) Opinion of Bermuda Counsel for the Company 21
(d) Opinion of Regulatory Counsel for Motorola Satellite Communications, Inc. 21
(e) Opinion of Assistant Secretary of the Company and General Counsel of Iridium 21
(f) Opinion of Counsel for International Managers 21
(g) Opinion of Regulatory Counsel for the International Managers 21
(h) Officers' Certificate 22
(i) Accountant's Comfort Letter 22
(j) Bring-down Comfort Letter 22
(k) Approval of Listing 22
(l) No Objection 22
(m) Motorola Certificate 22
(n) Purchase of Initial U.S. Securities 23
(o) Conditions to Purchase of International Option Securities 23
(p) Transactions 24
(q) Additional Documents 24
(r) Termination of Agreement 24
(s) Lock-up Agreements 24
SECTION 7. Indemnification 24
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(a) Indemnification of International Managers 24
(b) Indemnification of Company, Iridium, Directors and Officers 26
(c) Actions against Parties; Notification 26
(d) Settlement without Consent if Failure to Reimburse 27
(e) Indemnification for Reserved Securities 27
SECTION 8. Contribution 27
SECTION 9. Representations, Warranties and Agreements to Survive Delivery 29
SECTION 10. Termination of Agreement 29
(a) Termination; General 29
(b) Liabilities 29
SECTION 11. Default by One or More of the International Managers 29
SECTION 12. Notices 30
SECTION 13. Parties 30
SECTION 14. GOVERNING LAW AND TIME 31
SECTION 15. Effect of Headings 31
SCHEDULES
SCHEDULE A - LIST OF INTERNATIONAL MANAGERS ................................ SCH A-1
SCHEDULE B - PRICING INFORMATION ........................................... SCH B-1
SCHEDULE C - PERSONS SUBJECT TO LOCK-UP .................................... SCH C-1
EXHIBITS
EXHIBIT A-1 - FORM OF OPINION OF COMPANY'S AND IRIDIUM'S COUNSEL ........... X-0
XXXXXXX X-0 - FORM OF OPINION OF COMPANY'S BERMUDA COUNSEL ................. X-0
XXXXXXX X-0 - FORM OF OPINION OF REGULATORY COUNSEL
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MOTOROLA SATELLITE COMMUNICATIONS, INC ....................... X-0
XXXXXXX X-0 - FORM OF OPINION OF ASSISTANT SECRETARY AND GENERAL COUNSEL ... A-8
EXHIBIT B - FORM OF OPINION OF COUNSEL TO U.S. UNDERWRITERS ................ B-1
EXHIBIT C - FORM OF MOTOROLA CERTIFICATE ................................... C-1
EXHIBIT D - FORM OF LOCK-UP AGREEMENT ...................................... X-0
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Xxxxx xx Xxx 00, 0000
XXXXXXX WORLD COMMUNICATIONS LTD.
(a Bermuda company)
2,000,000 Shares of Class A Common Stock
(Par Value $.01 Per Share)
INTERNATIONAL PURCHASE AGREEMENT
Dated: _________, 1997
XXXXXXX XXXXX INTERNATIONAL
Xxxxxxxxx, Lufkin & Xxxxxxxx
Securities Corporation
Xxxxxxx Sachs International
as Lead Manager(s) of the several International Managers
c/o Merrill Xxxxx International
00 Xxxxxxxxxx Xxxx
Xxxxxx XXXX 0XX
Xxxxxxx
Ladies and Gentlemen:
Each of Iridium World Communications Ltd., a Bermuda company (the
"Company") and Iridium LLC, a Delaware limited liability company ("Iridium"),
confirms its agreement with Xxxxxxx Xxxxx International ("Xxxxxxx Xxxxx") and
each of the other international underwriters named in Schedule A hereto
(collectively, the "International Managers", which term shall also include any
underwriter substituted as hereinafter provided in Section 11 hereof), for whom
Xxxxxxx Lynch, Donaldson, Lufkin & Xxxxxxxx Securities Corporation and Xxxxxxx
Sachs International are acting as representatives (in such capacity, the "Lead
Managers"), with respect to the issue and sale by the Company and the purchase
by the International Managers, acting severally and not jointly, of the
respective numbers of shares of Class A Common Stock, par value $.01 per share,
of the Company ("Class A Common Stock") set forth in said Schedule A, and with
respect to the grant by the Company to the International Managers, acting
severally and not jointly, of the option described in Section 2(b) hereof to
purchase all or any part of 300,000 additional shares of Class A Common Stock to
cover over-allotments, if any. The aforesaid 2,000,000 shares of Class A Common
Stock (the "Initial International Securities") to be purchased by the
International Managers and all or any part of the 300,000 shares of Class A
Common Stock subject to the option described in Section 2(b) hereof (the
"International Option Securities") are hereinafter called, collectively, the
"International Securities."
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It is understood that each of the Company and Iridium is concurrently
entering into an agreement dated the date hereof (the "U.S. Purchase Agreement")
providing for the offering by the Company of an aggregate of 8,000,000 shares of
Class A Common Stock (the "Initial U.S. Securities") through arrangements with
certain underwriters in the United States and Canada (the "U.S. Underwriters")
for which Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated, Xxxxxxxxx, Lufkin
& Xxxxxxxx Securities Corporation and Xxxxxxx, Sachs & Co. are acting as
representatives (the "U.S. Representatives") and the grant by the Company to the
U.S. Underwriters, acting severally and not jointly, of an option to purchase
all or any part of the U.S. Underwriters' pro rata portion of up to 1,200,000
additional shares of Class A Common Stock solely to cover overallotments, if any
(the "U.S. Option Securities" and, together with the International Option
Securities, the "Option Securities"). The Initial U.S. Securities and the U.S.
Option Securities are hereinafter called the "U.S. Securities." It is understood
that the Company is not obligated to sell and the International Managers are not
obligated to purchase, any Initial International Securities unless all of the
Initial U.S. Securities are contemporaneously purchased by the U.S.
Underwriters.
The International Managers and the U.S. Underwriters are hereinafter
collectively called the "Underwriters," the Initial International Securities and
the Initial U.S. Securities are hereinafter collectively called the "Initial
Securities," and the International Securities, and the U.S. Securities are
hereinafter collectively called the "Securities."
The Underwriters are concurrently entering into an Intersyndicate Agreement
of even date herewith (the "Intersyndicate Agreement") providing for the
coordination of certain transactions among the Underwriters under the direction
of Xxxxxxx Xxxxx & Co., Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated (in
such capacity, the "Global Coordinator").
The Company understands that the International Managers propose to make a
public offering of the International Securities as soon as the Lead Managers
deem advisable after this Agreement has been executed and delivered.
The Company and the U.S. Underwriters have agreed that up to 1,000,000
shares of the Initial U.S. Securities to be purchased by the U.S. Underwriters
(the "Reserved Securities") shall be reserved for sale by the Underwriters to
eligible employees of the Company and Iridium and persons having business
relationships with Iridium as part of the distribution of the Securities by the
Underwriters, subject to the terms of this Agreement, the applicable rules,
regulations and interpretations of the National Association of Securities
Dealers, Inc. and all other applicable laws, rules and regulations. To the
extent that such Reserved Securities are not orally confirmed for purchase by
such eligible employees of the Company and Iridium and persons having business
relationships with Iridium by the end of the first business day after the date
of this Agreement, such Reserved Securities may be offered to the public as part
of the public offering contemplated hereby. Offers and sales of Reserved
Securities to eligible employees of the Company and Iridium and persons having
business relationships with Iridium in the Province of Canada will be effected
by the U.S. Underwriters or their affiliates at the request of and as agent of
the Company pursuant to prospectus exemption available in Quebec.
The Company and Iridium have entered into (i) an Interest Exchange
Agreement (the "Exchange Agreement"), (ii) a 1997 Subscription Agreement (the
"1997 Subscription Agreement"),
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(iii) a Share Issuance Agreement (the "Share Issuance Agreement") and (iv) a
Management Services Agreement (the "Management Services Agreement" and,
collectively with the Exchange Agreement, the 1997 Subscription Agreement, the
Share Issuance Agreement and the LLC Agreement (as defined below), the
"Governance Agreements"). On or prior to Closing Time (as defined below), (A)
pursuant to an amendment to the LLC Agreement, each Class 1 Membership Interest
in Iridium (each a "Class 1 Interest") shall be subdivided into 75 Class 1
Interests and each warrant an option to purchase Class 1 Interest, and the
conversion price of each limited liability company interest in Iridium that is
or may become convertible into or exchangeable for Class 1 Interests, shall be
adjusted accordingly, (B) Iridium shall issue and sell to the Company and the
Company shall purchase from Iridium Class 1 Interests under the 1997
Subscription Agreement with the proceeds from the issuance and sale of the
Securities as contemplated by this Agreement, the International Purchase
Agreement and the Registration Statement (as defined below) and (C) the Company
shall be admitted as a member of Iridium (collectively, the "Transactions").
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-1 (No. 333-23419) covering the
registration of the Securities under the Securities Act of 1933, as amended (the
"1933 Act"), including the related preliminary prospectus or prospectuses.
Promptly after execution and delivery of this Agreement, the Company will either
(i) prepare and file a prospectus in accordance with the provisions of Rule 430A
("Rule 430A") of the rules and regulations of the Commission under the 1933 Act
(the "1933 Act Regulations") and paragraph (b) of Rule 424 ("Rule 424(b)") of
the 1933 Act Regulations or (ii) if the Company has elected to rely upon Rule
434 ("Rule 434") of the 1933 Act Regulations, prepare and file a term sheet (a
"Term Sheet") in accordance with the provisions of Rule 434 and Rule 424(b). Two
forms of prospectus are to be used in connection with the offering and sale of
the Securities: one relating to the International Securities (the "Form of
International Prospectus") and one relating to the U.S. Securities (the "Form of
U.S. Prospectus"). The Form of International Prospectus is identical to the Form
of U.S. Prospectus, except for the front cover and back cover pages and the
information under the caption "Underwriting". The information included in any
such prospectus or in any such Term Sheet, as the case may be, that was omitted
from such registration statement at the time it became effective but that is
deemed to be part of such registration statement at the time it became effective
(a) pursuant to paragraph (b) of Rule 430A is referred to as "Rule 430A
Information" or (b) pursuant to paragraph (d) of Rule 434 is referred to as
"Rule 434 Information." Each Form of International Prospectus and Form of U.S.
Prospectus used before such registration statement became effective, and any
prospectus that omitted, as applicable, the Rule 430A Information or the Rule
434 Information, that was used after such effectiveness and prior to the
execution and delivery of this Agreement, is herein called a "preliminary
prospectus." Such registration statement, including the exhibits thereto and
schedules thereto at the time it became effective and including the Rule 430A
Information and the Rule 434 Information, as applicable, is herein called the
"Registration Statement." Any registration statement filed pursuant to Rule
462(b) of the 1933 Act Regulations is herein referred to as the "Rule 462(b)
Registration Statement," and after such filing the term "Registration Statement"
shall include the Rule 462(b) Registration Statement. The final Form of
International Prospectus and the final Form of U.S. Prospectus in the forms
first furnished to the Underwriters for use in connection with the offering of
the Securities are herein called the "International Prospectus" and the "U.S.
Prospectus," respectively, and collectively, the "Prospectuses." If Rule 434 is
relied on, the terms "International Prospectus" and "U.S. Prospectus" shall
refer to the preliminary International Prospectus dated May
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9, 1997 and preliminary U.S. Prospectus dated May 9, 1997, respectively, each
together with the applicable Term Sheet and all references in this Agreement to
the date of such Prospectuses shall mean the date of the applicable Term Sheet.
For purposes of this Agreement, all references to the Registration Statement,
any preliminary prospectus, the International Prospectus, the U.S. Prospectus or
any Term Sheet or any amendment or supplement to any of the foregoing shall be
deemed to include the copy filed with the Commission pursuant to its Electronic
Data Gathering, Analysis and Retrieval system ("XXXXX").
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.
SECTION 1. Representations and Warranties.
(a) Representations and Warranties by the Company and Iridium. Each of
the Company and Iridium jointly and severally represents and warrants to each
International Manager as of the date hereof, as of the Closing Time referred to
in Section 2(c) hereof, and as of each Date of Delivery (if any) referred to in
Section 2(b) hereof, and agrees with each International Manager, as follows:
(i) Compliance with Registration Requirements. Each of the
Registration Statement and any Rule 462(b) Registration Statement has
become effective under the 1933 Act and no stop order suspending the
effectiveness of the Registration Statement or any Rule 462(b)
Registration Statement has been issued under the 1933 Act and no
proceedings for that purpose have been instituted or are pending or, to
the knowledge of the Company or Iridium, are contemplated by the
Commission, and any request on the part of the Commission for
additional information has been complied with.
At the respective times the Registration Statement, any Rule
462(b) Registration Statement and any post-effective amendments thereto
became effective and at the Closing Time (and, if any International
Option Securities are purchased, at the Date of Delivery), the
Registration Statement, the Rule 462(b) Registration Statement and any
amendments and supplements thereto complied and will comply in all
material respects with the requirements of the 1933 Act and the 1933
Act Regulations and did not and will not contain an untrue statement of
a material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein not misleading, and
the Prospectuses, any preliminary prospectuses and any supplement
thereto or prospectus wrapper prepared in connection therewith, at
their respective times of issuance and at the Closing Time, complied
and will comply in all material respects with any applicable laws or
regulations of foreign jurisdictions in which the Prospectuses and such
preliminary prospectuses, as amended or supplemented, if applicable,
are distributed in connection with the offer and sale of Reserved
Securities. Neither of the Prospectuses nor any amendments or
supplements thereto (including any prospectus wrapper), at the time the
Prospectuses or any amendments or supplements thereto were issued and
at the Closing Time (and, if any International Option Securities are
purchased, at the Date of Delivery), included or will include an untrue
statement of a material fact or omitted or will omit to state a
material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading.
If Rule 434 is used, the Company will comply with the requirements of
Rule 434 and the Prospectuses shall not be "materially different," as
such term is used in Rule 434, from the prospectuses included in the
Registration Statement at the time it became effective.
Each preliminary prospectus and the prospectuses filed as part
of the Registration Statement as originally filed or as part of any
amendment thereto, or filed pursuant to Rule 424 under the 1933 Act,
complied when so filed in all material respects with the 1933 Act
Regulations and each preliminary prospectus and the Prospectuses
delivered to the Underwriters for use in connection with this offering
was identical in all material respects to the electronically
transmitted copies thereof filed with the Commission pursuant to
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XXXXX, except to the extent permitted by Regulation S-T. The
representations and warranties in this subsection (a)(i) shall not
apply to statements in or omissions from the Registration Statement or
the U.S. Prospectus made in reliance upon and in conformity with
information furnished to the Company in writing by any International
Manager through the International Manager expressly for use in the
Registration Statement or the International Prospectus.
(ii) Independent Accountants. The accountants who certified
the financial statement and the consolidated financial statements
included in the Registration Statement are independent public
accountants as required by the 1933 Act and the 1933 Act Regulations.
(iii) Financial Statements. The financial statement and the
consolidated financial statements included in the Registration
Statement and the Prospectuses, together with the related notes,
present fairly the financial position of the Company, Iridium,
Iridium's predecessor and their respective consolidated subsidiaries at
the dates indicated and the statement of operations, stockholders'
equity, members' equity and cash flows of the Company, Iridium,
Iridium's predecessor and their respective consolidated subsidiaries
for the periods specified; said financial statement and the
consolidated financial statements have been prepared in conformity with
generally accepted accounting principles ("GAAP") applied on a
consistent basis throughout the periods involved, except in the case of
the interim financial statements, for the absence of complete footnote
disclosure and customary year-end adjustments. The selected financial
data included in the Prospectuses present fairly the information shown
therein and have been compiled on a basis consistent with that of the
audited financial statement and the consolidated financial statements
included in the Registration Statement.
(iv) No Material Adverse Change in Business. Since the
respective dates as of which information is given in the Registration
Statement and the Prospectuses, except for the matters disclosed in the
Registration Statement, (A) there has been no material adverse change
in the condition, financial or otherwise, or in the earnings, business
affairs or business prospects of the Company or Iridium, whether or not
arising in the ordinary course of business (a "Material Adverse
Effect"), (B) there have been no transactions entered into by the
Company or Iridium, other than those in the ordinary course of
business, which are material with respect to the Company or Iridium and
(C) except for quarterly, in-kind dividends on the Series A Class 2
Interests in Iridium (the "Series A Interests") in amounts per Series A
Interest that are consistent with the terms of the Series A Interests
and the Limited Liability Company Agreement of Iridium LLC, dated as of
July 29, 1996, as amended as of the date hereof (the "LLC Agreement"),
there has been no dividend or distribution of any kind declared, paid
or made by the Company on any class of its capital stock, or Iridium on
any class or series of its limited liability company interests (its
"Interests").
(v) Good Standing of the Company and Iridium. The Company has
been duly incorporated and is validly existing as an exempted company
in good standing under the laws of Bermuda and has all requisite power
and authority to conduct its business as described in the Prospectuses
and to enter into and perform its obligations under this Agreement; and
the Company has been duly qualified as a foreign company to transact
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business and is in good standing in each other jurisdiction in which
such qualification is required, whether by reason of the ownership or
leasing of property or the conduct of business, except where the
failure so to qualify or to be in good standing would not result in a
Material Adverse Effect.
Iridium has been duly formed and is an existing limited
liability company in good standing under the laws of the State of
Delaware and has all requisite corporate power and authority to own,
lease and operate its properties and to conduct its business as
described in the Prospectuses and to enter into and perform its
obligations under this Agreement; and Iridium has been duly qualified
as a foreign limited liability company to transact business and is in
good standing in each other jurisdiction in which such qualification is
required, whether by reason of the ownership or leasing of property or
the conduct of business, except where the failure so to qualify or to
be in good standing would not result in a Material Adverse Effect.
(vi) No Significant Subsidiary Neither the Company nor Iridium
has any "significant subsidiary" as such term is defined in Rule 1-02
of Regulation S-X.
(vii) Capitalization. The authorized, issued and outstanding
capital stock of the Company are as set forth in the Prospectuses in
the column entitled "Actual" under the caption "Capitalization--The
Company." The shares of issued and outstanding capital stock of the
Company have been duly authorized and validly issued and are fully paid
and non-assessable; none of the outstanding shares of capital stock of
the Company was issued in violation of the preemptive or other similar
rights of any securityholder of the Company.
The authorized, issued and outstanding Interests of Iridium
are as set forth in the Prospectuses in the column entitled "Actual"
under the caption "Capitalization--Iridium." The issued and outstanding
Interests of Iridium have been duly authorized and validly issued and
are fully paid and non-assessable (except as disclosed in the
Registration Statement under the caption "Description of Iridium LLC
Limited Liability Company Agreement--Limitations on Liability"); none
of the outstanding Interests of Iridium was issued in violation of the
preemptive or other similar rights of any member of Iridium. Pursuant
to the LLC Agreement, and in accordance with the Delaware Limited
Liability Company Act (the "Delaware Act"), the Company has waived the
limitation on liability contained in the Delaware Act, provided that
the Company has no liability to any person, including Iridium, for any
debt, obligation or liability of Iridium until all of the assets and
capital of Iridium have first been exhausted in satisfaction thereof.
(viii) Authorization of Agreement. This Agreement and the U.S.
Purchase Agreement have been duly authorized, executed and delivered by
each of the Company and Iridium.
(ix) Authorization and Description of Securities. The
Securities to be purchased by the International Managers and the U.S.
Underwriters from the Company have been duly authorized for issuance
and sale to the International Managers pursuant to this Agreement and
the U.S. Underwriters pursuant to the U.S. Purchase Agreement,
respectively, and, when issued and delivered by the Company pursuant
to this Agreement and the U.S.
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Purchase Agreement, respectively, against payment of the consideration
set forth herein and in the U.S. Purchase Agreement, respectively, will
be validly issued, fully paid and non-assessable; the Class A Common
Stock will conform in all material respects to the descriptions thereof
contained in the Prospectuses; upon full payment of the consideration
therefor no, holder of the Securities will be subject to personal
liability by reason of being such a holder; and the issuance of the
Securities is not subject to the preemptive or other similar rights of
any securityholder of the Company.
The Class 1 Interests to be purchased by the Company from
Iridium have been duly authorized for issuance and sale to the Company
pursuant to the 1997 Subscription Agreement and, when issued and
delivered by Iridium pursuant to the 1997 Subscription Agreement
against payment of the consideration set forth therein, will be validly
issued, and (except as set forth in Section 2.09 of the LLC Agreement)
fully paid and non-assessable; such Class 1 Interests will conform in
all material respects to the descriptions thereof contained in the
Prospectuses and such descriptions conform to the rights set forth in
the instruments defining the same (except as disclosed in the
Prospectuses under the caption "Description of Iridium LLC Limited
Liability Company Agreement--Limitations on Liability"); except as
described in the Prospectuses under the caption "Description of Iridium
LLC Limited Liability Company Agreement--Limitations on Liability," no
holder of such Class 1 Interests will be subject to personal liability
by reason of being such a holder; and the issuance of the Class 1
Interests pursuant to the 1997 Subscription Agreement is not subject to
the preemptive or other similar rights of any member of Iridium.
Pursuant to the LLC Agreement, and in accordance with the Delaware Act,
the Company has waived the limitation on liability contained in the
Delaware Act, provided that the Company has no liability to any person,
including Iridium, for any debt, obligation or liability of Iridium
until all of the assets and capital of Iridium have first been
exhausted in satisfaction thereof.
(x) Absence of Defaults and Conflicts. Neither the Company nor
Iridium is in violation of its memorandum of association or bye-laws,
certificate of formation or limited liability company agreement or in
default in the performance or observance of any obligation, agreement,
covenant or condition contained in any contract, indenture, mortgage,
deed of trust, loan or credit agreement, note, lease or other agreement
(including the Governance Agreements) or instrument to which the
Company or Iridium is a party or by which it or any of them may be
bound, or to which any of the property or assets of the Company or
Iridium is subject (collectively, "Agreements and Instruments") except
for such defaults that would not result in a Material Adverse Effect;
and the execution, delivery and performance of this Agreement and the
U.S. Purchase Agreement and the consummation of the transactions
contemplated in this Agreement, the U.S. Purchase Agreement, the
Governance Agreements and in the Registration Statement (including the
issuance and sale of the Securities and the use of the proceeds from
the sale of the Securities as described in the Prospectuses under the
caption "Use of Proceeds") and by the Transactions and compliance by
each of the Company and Iridium with its obligations under this
Agreement, the U.S. Purchase Agreement and the Governance Agreements
have been duly authorized by all necessary corporate action and do not
and will not, whether with or without the giving of notice or passage
of time or both, conflict with or constitute a breach of, or default or
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Repayment Event (as defined below) under, or result in the creation or
imposition of any lien, charge or encumbrance upon any property or
assets of the Company or Iridium pursuant to, the Agreements and
Instruments (except for such conflicts, breaches or defaults or liens,
charges or encumbrances that would not result in a Material Adverse
Effect), nor will such action result in any violation of the provisions
of the memorandum of association, bye-laws, certificate of formation or
limited liability company agreement of the Company or Iridium or any
applicable law, statute, rule, regulation, judgment, order, writ or
decree of any government, government instrumentality or court, domestic
or foreign, having jurisdiction over the Company or Iridium or any of
their assets, properties or operations. As used herein, a "Repayment
Event" means any event or condition which gives the holder of any note,
debenture or other evidence of indebtedness (or any person acting on
such holder's behalf) the right to require the repurchase, redemption
or repayment of all or a portion of such indebtedness by the Company or
Iridium.
(xi) Absence of Labor Dispute. No labor dispute with the
employees of the company or Iridium exists or, to the knowledge of the
Company or Iridium, is imminent.
(xii) Absence of Proceedings. Except for matters which are
described in the Registration Statement, there is no action, suit,
proceeding, inquiry or investigation before or brought by any court or
governmental agency or body, domestic or foreign, now pending, or, to
the knowledge of the Company or Iridium, threatened, against or
affecting the Company or Iridium, which is required to be disclosed in
the Registration Statement, or which might reasonably be expected to
result in a Material Adverse Effect, or which might reasonably be
expected to materially and adversely affect the properties or assets
thereof or the consummation of the transactions contemplated in this
Agreement and the U.S. Purchase Agreement or the Transactions or the
performance, if determined adversely to the Company or Iridium, of its
obligations hereunder or thereunder; all pending legal or governmental
proceedings to which the Company or Iridium is a party or of which any
of their respective property or assets is the subject which are not
described in the Registration Statement, including ordinary routine
litigation incidental to the business, would not reasonably be expected
to result in a Material Adverse Effect.
(xiii) Accuracy of Exhibits. There are no contracts or
documents which are required to be described in the Registration
Statement or the Prospectuses or to be filed as exhibits thereto which
have not been so described and filed as required.
(xiv) Possession of Intellectual Property. Except as described
in the Registration Statement or as would not have a Material Adverse
Effect, Iridium owns or possesses or reasonably believes it can acquire
on reasonable terms, adequate patents, patent rights, licenses,
inventions, copyrights (including trade secrets and other unpatented
and/or unpatentable proprietary or confidential information, systems or
procedures, but excluding any required regulatory licenses or
approvals), trademarks, service marks, trade names or other
intellectual property (collectively, "Intellectual Property") or that
it can contract on reasonable terms with third parties who can acquire
the Intellectual Property necessary to carry on the business now
operated by Iridium or described in the Registration Statement, and
neither the Company nor Iridium has received any notice or is otherwise
aware of any infringement of or conflict with asserted rights of others
with respect to any Intellectual
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16
Property or of any facts or circumstances which would render any
Intellectual Property invalid or inadequate to protect the interest of
the Company or Iridium, and which infringement or conflict (if the
subject of any unfavorable decision, ruling or finding) or invalidity
or inadequacy, singly or in the aggregate, would result in a Material
Adverse Effect.
(xv) Absence of Further Requirements. No filing with, or
authorization, approval, consent, license, order, registration,
qualification or decree of, any court or governmental authority or
agency is necessary or required for the performance by the Company or
Iridium of its obligations hereunder, in connection with the offering,
issuance or sale of the Securities under this Agreement and the U.S.
Purchase Agreement or the consummation of the transactions contemplated
by this Agreement and the U.S. Purchase Agreement or by the
Transactions except (i) such as have been already obtained or as may be
required under the 1933 Act or the 1933 Act Regulations and foreign or
state securities or blue sky laws and (ii) such as have been obtained
under the laws and regulations of jurisdictions outside the United
States in which the Reserved Securities are offered.
(xvi) Possession of Licenses and Permits. Except as disclosed
in the Registration Statement or as would not have a Material Adverse
Effect, (i) Iridium possesses such permits, licenses, approvals,
consents and other authorizations (collectively, "Governmental
Licenses") issued by the appropriate federal, state, local or foreign
regulatory agencies or bodies necessary to conduct the business now
operated by Iridium and (ii) Iridium is in compliance with the current
terms and conditions of all such Governmental Licenses, except where
the failure so to comply would not, singly or in the aggregate, have a
Material Adverse Effect; all of the Governmental Licenses are valid and
in full force and effect, except where the invalidity of such
Governmental Licenses or the failure of such Governmental Licenses to
be in full force and effect would not have a Material Adverse Effect;
and neither the Company nor Iridium has received any notice of
proceedings relating to the revocation or modification of any such
Governmental Licenses which, singly or in the aggregate, if the subject
of an unfavorable decision, ruling or finding, would result in a
Material Adverse Effect. This representation does not extend to
Governmental Licenses required for Iridium to conduct its business as
proposed to be conducted, most of which have not been obtained.
(xvii) Title to Property. The Company owns no real property.
Iridium has good and marketable title to all real property it owns; and
the Company and Iridium have good title to all other properties owned
by them, in each case, free and clear of all mortgages, pledges, liens,
security interests, claims, restrictions or encumbrances of any kind
except such as (a) are described in the Registration Statement or (b)
would not, singly or in the aggregate, reasonably be expected to have a
Material Adverse Effect; and all of the leases and subleases material
to the business of the Company and Iridium, considered as one
enterprise, and under which the Company and Iridium hold properties
described in the Prospectuses, are in full force and effect, and
neither the Company nor Iridium has any notice of any material claim of
any sort that has been asserted by anyone adverse to the rights of the
Company or Iridium under any of the leases or subleases mentioned
above, or affecting or questioning the rights of the Company or Iridium
to the continued possession
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17
of the leased or subleased premises under any such lease or sublease
except such as would not reasonably be expected to have a Material
Adverse Effect.
(xviii) Compliance with Cuba Act. The Company has complied
with, and is and will be in compliance with, the provisions of that
certain Florida act relating to disclosure of doing business with Cuba,
codified as Section 517.075 of the Florida statutes, and the rules and
regulations thereunder (collectively, the "Cuba Act") or is exempt
therefrom.
(xix) Investment Company Act. The Company believes that it is
not, and upon the issuance and sale of the Securities as herein
contemplated and the application of the net proceeds therefrom as
described in the Prospectuses, will not be, an "investment company" or
an entity "controlled" by an "investment company" as such terms are
defined in the Investment Company Act of 1940, as amended (the "1940
Act").
(xx) Environmental Laws. Except as described in the
Registration Statement and except as would not, singly or in the
aggregate, result in a Material Adverse Effect, (A) neither the Company
nor Iridium is in violation of any federal, state, local or foreign
statute, law, rule, regulation, ordinance, code, policy or rule of
common law or any judicial or administrative interpretation thereof,
including any judicial or administrative order, consent, decree or
judgment, relating to pollution or protection of human health, the
environment (including, without limitation, ambient air, surface water,
groundwater, land surface or subsurface strata) or wildlife, including,
without limitation, laws and regulations relating to the release or
threatened release of chemicals, pollutants, contaminants, wastes,
toxic substances, hazardous substances, petroleum or petroleum products
(collectively, "Hazardous Materials") or to the manufacture,
processing, distribution, use, treatment, storage, disposal, transport
or handling of Hazardous Materials (collectively, "Environmental
Laws"), (B) Iridium has all permits, authorizations and approvals
required under any applicable Environmental Laws and is in compliance
with its requirements, (C) there are no pending or threatened
administrative, regulatory or judicial actions, suits, demands, demand
letters, claims, liens, notices of noncompliance or violation,
investigation or proceedings relating to any Environmental Law against
Iridium and (D) there are no events or circumstances that might
reasonably be expected to form the basis of an order for clean-up or
remediation, or an action, suit or proceeding by any private party or
governmental body or agency, against or affecting the Company or
Iridium relating to Hazardous Materials or any Environmental Laws.
(xxi) Registration Rights. There are no persons with
registration rights or other similar rights to have any securities
registered pursuant to the Registration Statement or, except as set
forth in the Registration Statement, otherwise registered by the
Company under the 1933 Act.
(xxii) Principal Agreements. Except as disclosed in the
Registration Statement and except as would not reasonably be expected
to have a Material Adverse Effect, to the best of the Company's and
Iridium's knowledge, none of the parties to (i) the Gateway
Authorization Agreements (as defined in the Prospectuses), (ii) the
Space System Contract (as defined in the Prospectuses), (iii) the
Operations and Maintenance Contract (as defined in the Prospectuses),
(iv) the Iridium Business Support System Contract with Xxxxxxxx
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Consulting (the "IBSS Contract"), (v) the Terrestrial Network
Development Contract (as defined in the Prospectus), and (vi) the
Support Agreement between Iridium and Motorola (the "Support
Agreement") (collectively, the foregoing are herein called the
"Principal Agreements"), is in breach of, or in default in the
performance or observance of, any material obligation, term, covenant
or condition contained therein. Each of the Principal Agreements that
the Company has delivered to the International Managers is a true and
correct copy, and there have been no additional amendments,
alterations, modifications or waivers thereto or in the exhibits or
schedules thereto. Iridium has duly and validly authorized, executed
and delivered each of the Principal Agreements to which it is a party
and, to the best of the Company's and Iridium's knowledge, the other
parties to each of the Principal Agreements have duly and validly
executed and delivered each of the Principal Agreements and, assuming
such authorization, execution and delivery by such other parties, each
of the Principal Agreements is a legally valid and binding agreement of
Iridium, enforceable against Iridium in accordance with its terms,
subject, as to enforcement, to bankruptcy, insolvency, reorganization
and other laws of general applicability relating to or affecting
creditors' rights and to general equity principles; provided that no
representation or warranty is made with respect to any provision of
such agreement purporting to require indemnification of, or
contribution to, the liability losses, damages or claims of any person
to the extent that such provision may be limited by applicable laws.
(xxiii) Governance Agreements. Neither the Company nor
Iridium, nor to the best knowledge of the Company and Iridium, any
other party to any of the Governance Agreements, is in breach of, or in
default in the performance or observance of, any material obligation,
term, covenant or condition contained in any of the Governance
Agreements. Each of the Governance Agreements that the Company has
delivered to the International Managers is a true and correct copy, and
there have been no additional amendments, alterations, modifications or
waivers thereto or in the exhibits or schedules thereto. Each of the
Company and Iridium has duly and validly executed and delivered each of
the Governance Agreements and, to the best of the Company's and
Iridium's knowledge, the other parties to each of the Governance
Agreements have duly and validly authorized, executed and delivered
each of the Governance Agreements and, assuming such authorization,
execution and delivery by such other parties, each of the Governance
Agreements is a legally valid and binding agreement of the Company and
Iridium, enforceable against the Company and Iridium in accordance with
its terms, subject, as to enforcement, to bankruptcy, insolvency,
reorganization and other laws of general applicability relating to or
affecting creditors' rights and to general equity principles; provided
that no representation or warranty is made with respect to any
provision of such agreement purporting to require indemnification of,
or contribution to, the liability losses, damages or claims of any
person to the extent that such provision may be limited by applicable
laws.
(xxiv) FCC License. The Federal Communications Commission (the
"FCC") has authorized Motorola, Inc. (Motorola, Inc. together with its
subsidiaries, "Motorola") to construct a mobile satellite system
capable of operating in the 1616 to 1626.5 MHz frequency bands,
consistent with the technical specifications set forth in its
application, as modified, the FCC's rules and the conditions set forth
in the FCC's Order and Xxxxxxxxxxxxx
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00
(XX 00-000, released January 31, 1995, DA 95-372, released February 28,
1995, FCC 96-279, released June 27, 1996, DA 96-1789, released October
30, 1996).
(xxv) Forward Looking Statements. The statements (including
the assumptions described therein) included in the Registration
Statement and the Prospectuses relating to Iridium's operations,
expected markets, size of expected addressable markets for mobile
satellite services, expected technical capabilities, expected funding
needs, expected financing sources, expected pricing, expected launch
schedule, expected commercial operations schedule, the estimate of the
last year in which Iridium will have negative cash flow and a net
increase in year-end borrowings and expected future regulatory
approvals as well as information concerning expected characteristics of
competing systems and expected actions of third parties such as
equipment suppliers, gateway operators, service providers and roaming
partners were made by the Company with a reasonable basis and reflect
the Company's good faith estimate of the matters described therein.
(xxvi) Certain Descriptions. The statements set forth in the
Prospectuses under the captions "Governance of the Company and
Relationship with Iridium," "Description of Capital Stock" and
"Description of Iridium LLC Limited Liability Company Agreement,"
insofar as they purport to constitute a summary of the terms of the
Class A Common Stock and the Interests, as the case may be, and to
describe the provisions of the laws and documents referred to therein,
and under the captions "Risk Factors--Risks Associated with Licensing
and Spectrum Allocation," "Risk Factors--Risks Associated with
Principal Supply Contracts," "Principal Contracts for the Development
of the Iridium System," "Certain Relationships and Related
Transactions," "Tax Considerations" and "Underwriting," insofar as they
purport to describe the provisions of the laws and documents referred
to therein, are accurate, complete and fair in all material respects.
(xxvii) Accounting Controls. The Company and Iridium maintain
a system of internal accounting controls sufficient to provide
reasonable assurances that (A) transactions are executed in accordance
with management's general or specific authorization; (B) transactions
are recorded as necessary to permit preparation of financial statements
in conformity with generally accepted accounting principles and to
maintain accountability for assets; (C) access to assets is permitted
only in accordance with management's general or specific authorization;
and (D) the recorded accountability for assets is compared with the
existing assets at reasonable intervals and appropriate action is taken
with respect to any differences.
(b) Officers' Certificates. Any certificate signed by any officer of
the Company or Iridium delivered to the Global Coordinator, the Lead Manager(s)
or to counsel for the International Managers shall be deemed a representation
and warranty by the Company and Iridium to each International Manager as to the
matters covered thereby but no personal liability therefor shall attach to the
officer providing any such certificate.
SECTION 2. Sale and Delivery to International Managers; Closing.
(a) Initial Securities. On the basis of the representations and
warranties herein contained and subject to the terms and conditions herein set
forth, the Company agrees to sell to
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each International Manager, severally and not jointly, and each International
Manager, severally and not jointly, agrees to purchase from the Company, at the
price per share set forth in Schedule B, the number of Initial International
Securities set forth in Schedule A opposite the name of such International
Manager, plus any additional number of Initial International Securities which
such International Manager may become obligated to purchase pursuant to the
provisions of Section 11 hereof.
(b) Option Securities. In addition, on the basis of the representations
and warranties herein contained and subject to the terms and conditions herein
set forth, the Company hereby grants an option to the International Managers,
severally and not jointly, to purchase up to an additional 300,000 shares of
Class A Common Stock at the price per share set forth in Schedule B, less an
amount per share equal to any dividends or distributions declared by the Company
and payable on the Initial International Securities but not payable on the
International Option Securities. The option hereby granted will expire 30 days
after the date hereof and may be exercised in whole or in part from time to time
only for the purpose of covering over-allotments which may be made in connection
with the offering and distribution of the Initial International Securities upon
notice by the Global Coordinator to the Company and Iridium setting forth the
number of International Option Securities as to which the several International
Managers are then exercising the option and the time and date of payment and
delivery for such International Option Securities. Any such time and date of
delivery for the International Option Securities (a "Date of Delivery") shall be
determined by the Global Coordinator, but shall not be later than seven full
business days after the exercise of said option, nor in any event prior to the
Closing Time, as hereinafter defined. If the option is exercised as to all or
any portion of the International Option Securities, each of the International
Managers, acting severally and not jointly, will purchase that proportion of the
total number of International Option Securities then being purchased which the
number of Initial International Securities set forth in Schedule A opposite the
name of such International Manager bears to the total number of Initial
International Securities, subject in each case to such adjustments as the Global
Coordinator in its discretion shall make to eliminate any sales or purchases of
fractional shares.
(c) Payment. Payment of the purchase price for, and delivery of
certificates for, the Initial Securities shall be made at the offices of
Xxxxxxxx & Xxxxxxxx, 0000 Xxxxxxxxxxxx Xxxxxx, XX, Xxxxxxxxxx, XX, 00000, or at
such other place as shall be agreed upon by the Global Coordinator and the
Company, at 9:00 A.M. (Eastern time) on the third (fourth, if the pricing occurs
after 4:30 P.M. (Eastern time) on any given day) business day after the date
hereof (unless postponed in accordance with the provisions of Section 11), or
such other time not later than ten business days after such date as shall be
agreed upon by the Global Coordinator and the Company (such time and date of
payment and delivery being herein called "Closing Time").
In addition, in the event that any or all of the International Option
Securities are purchased by the International Managers, payment of the purchase
price for, and delivery of certificates for, such International Option
Securities shall be made at the above-mentioned offices, or at such other place
as shall be agreed upon by the Global Coordinator and the Company, on each Date
of Delivery as specified in the notice from the Global Coordinator to the
Company.
Payment shall be made to the Company by wire transfer of immediately
available funds to a bank account designated by the Company, against delivery to
the Lead Manager(s) for the
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21
respective accounts of the International Managers of certificates for the
International Securities to be purchased by them. It is understood that each
International Manager has authorized the Lead Manager(s), for its account, to
accept delivery of, receipt for, and make payment of the purchase price for, the
Initial International Securities and the International Option Securities, if
any, which it has agreed to purchase. Xxxxxxx Xxxxx, individually and not as
representative of the International Managers, may (but shall not be obligated
to) make payment of the purchase price for the Initial International Securities
or the International Option Securities, if any, to be purchased by any
International Manager whose funds have not been received by the Closing Time or
the relevant Date of Delivery, as the case may be, but such payment shall not
relieve such International Manager from its obligations hereunder.
(d) Denominations; Registration. Certificates for the Initial
International Securities and the International Option Securities, if any, shall
be in such denominations and registered in such names as the Lead Managers may
request in writing at least one full business day before the Closing Time or the
relevant Date of Delivery, as the case may be. The certificates for the Initial
International Securities and the International Option Securities, if any, will
be made available for examination and packaging by the Lead Managers in The City
of New York not later than 10:00 A.M. (Eastern time) on the business day prior
to Closing Time or the relevant Date of Delivery, as the case may be.
SECTION 3. Covenants of the Company. The Company covenants with each
International Manager as follows:
(a) Compliance with Securities Regulations and Commission Requests. The
Company, subject to Section 3(b), will comply with the requirements of Rule 430A
or Rule 434, as applicable, and will notify the Global Coordinator immediately,
and confirm the notice in writing, (i) when any post-effective amendment to the
Registration Statement shall become effective, or any supplement to the
Prospectuses or any amended Prospectuses shall have been filed, (ii) of the
receipt of any comments from the Commission, (iii) of any request by the
Commission for any amendment to the Registration Statement or any amendment or
supplement to the Prospectuses or for additional information, and (iv) of the
issuance by the Commission of any stop order suspending the effectiveness of the
Registration Statement or of any order preventing or suspending the use of any
preliminary prospectus, or of the suspension of the qualification of the
Securities for offering or sale in any jurisdiction, or of the initiation or
threatening of any proceedings for any of such purposes. The Company will
promptly effect the filings necessary pursuant to Rule 424(b) and will take such
steps as it deems necessary to ascertain promptly whether the form of prospectus
transmitted for filing under Rule 424(b) was received for filing by the
Commission and, in the event that it was not, it will promptly file such
prospectus. The Company will make every reasonable effort to prevent the
issuance of any stop order and, if any stop order is issued, to obtain the
lifting thereof at the earliest possible moment.
(b) Filing of Amendments. The Company will give the Global Coordinator
notice of its intention to file or prepare any amendment to the Registration
Statement (including any filing under Rule 462(b)), any Term Sheet or any
amendment, supplement or revision to either the prospectus included in the
Registration Statement at the time it became effective or to the Prospectuses,
will furnish the Global Coordinator with copies of any such documents a
reasonable amount of time prior to such proposed filing or use, as the case may
be, and will not file or use any such document
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to which the Global Coordinator or counsel for the International Managers shall
object promptly after it receives copies thereof.
(c) Delivery of Registration Statements. The Company has furnished or
will deliver to the Lead Manager(s) and counsel for the International Managers,
without charge, signed copies of the Registration Statement as originally filed
and of each amendment thereto (including exhibits filed therewith or
incorporated by reference therein) and signed copies of all consents and
certificates of experts, and will also deliver to the Lead Manager(s), without
charge, a conformed copy of the Registration Statement as originally filed and
of each amendment thereto (without exhibits) for each of the International
Managers. The copies of the Registration Statement and each amendment thereto
furnished to the International Managers will be identical in all material
respects to the electronically transmitted copies thereof filed with the
Commission pursuant to XXXXX, except to the extent permitted by Regulation S-T.
(d) Delivery of Prospectuses. Subject to paragraph (e), the Company has
delivered to each International Manager, without charge, as many copies of each
preliminary prospectus as such International Manager reasonably requested, and
the Company hereby consents to the use of such copies for purposes permitted by
the 1933 Act. The Company will furnish to each International Manager, without
charge, during the period when the International Prospectus is required to be
delivered under the 1933 Act or the Securities Exchange Act of 1934 (the "1934
Act"), such number of copies of the International Prospectus (as amended or
supplemented) as such International Manager may reasonably request. The
International Prospectus and any amendments or supplements thereto furnished to
the International Managers will be identical in all material respects to the
electronically transmitted copies thereof filed with the Commission pursuant to
XXXXX, except to the extent permitted by Regulation S-T.
(e) Continued Compliance with Securities Laws. The Company will comply
with the 1933 Act and the 1933 Act Regulations so as to permit the completion of
the distribution of the Securities as contemplated in this Agreement, the U.S.
Purchase Agreement and in the Prospectuses. If at any time during the nine month
period immediately following the time of issue of the U.S. Prospectus a
prospectus is required by the 1933 Act to be delivered in connection with sales
of the Securities, any event shall occur or condition shall exist as a result of
which it is necessary, in the opinion of counsel for the International Managers
or for the Company, to amend the Registration Statement or amend or supplement
any Prospectus in order that the Prospectuses will not include any untrue
statements of a material fact or omit to state a material fact necessary in
order to make the statements therein not misleading in the light of the
circumstances existing at the time it is delivered to a purchaser, or if it
shall be necessary, in the opinion of such counsel, at any such time to amend
the Registration Statement or amend or supplement any Prospectus in order to
comply with the requirements of the 1933 Act or the 1933 Act Regulations, the
Company will promptly prepare and file with the Commission, subject to Section
3(b), such amendment or supplement as may be necessary to correct such statement
or omission or to make the Registration Statement or the Prospectuses comply
with such requirements, and the Company will furnish to the International
Managers such number of copies of such amendment or supplement as the
International Managers may reasonably request. In case any U.S. Underwriter is
required to deliver a prospectus in connection with the sale of U.S. Securities
at any time nine months or more after the time of issue of the U.S. Prospectus,
upon request of the U.S. Underwriters but at the expense of
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such U.S. Underwriters, the Company agrees to prepare and deliver to such U.S.
Underwriters as many copies as the U.S. Underwriters may request of an amended
or supplemented U.S. Prospectus complying with Section 10(a)(3) of the 1933 Act.
(f) Blue Sky Qualifications. The Company will use its best efforts, in
cooperation with the International Managers, to qualify the Securities for
offering and sale under the applicable securities laws of such states and other
jurisdictions (domestic or foreign) as the Global Coordinator may designate and
to maintain such qualifications in effect for a period of not less than one year
from the later of the effective date of the Registration Statement and any Rule
462(b) Registration Statement; provided, however, that the Company shall not be
obligated to file any general consent to service of process or to qualify as a
foreign corporation or as a dealer in securities in any jurisdiction in which it
is not so qualified or to subject itself to taxation or other governmental fees
and charges in respect of doing business in any jurisdiction in which it is not
otherwise so subject. In each jurisdiction in which the Securities have been so
qualified, the Company will file such statements and reports as may be required
by the laws of such jurisdiction to continue such qualification in effect for a
period of not less than one year from the effective date of the Registration
Statement and any Rule 462(b) Registration Statement.
(g) Rule 158. The Company will timely file such reports pursuant to the
1934 Act as are necessary in order to make generally available to its
securityholders as soon as practicable an earnings statement for the purposes
of, and to provide the benefits contemplated by, the last paragraph of Section
11(a) of the 1933 Act.
(h) Use of Proceeds. The Company will use the net proceeds received by
it from the sale of the Securities in the manner specified in the Prospectuses
under "Use of Proceeds". The Company shall take such steps as shall be necessary
to ensure that the Company shall not become an "investment company" within the
meaning of such term under the 1940 Act and the rules and regulations
thereunder; provided that the Company is not able to control the occurrence of a
"Company Change in Control" or "Reduction in Interest" as such terms are defined
in the LLC Agreement.
(i) Listing. The Company will use its best efforts to effect and
maintain the quotation of the Securities on the Nasdaq National Market and will
file with the Nasdaq National Market all documents and notices required by the
Nasdaq National Market of companies that have securities that are traded in the
over-the-counter market and quotations for which are reported by the Nasdaq
National Market.
(j) Restriction on Sale of Securities. During a period of 180 days from
the date of the Prospectuses, the Company will not, without the prior written
consent of the Global Coordinator, (i) directly or indirectly, offer, pledge,
sell, contract to sell, sell any option or contract to purchase, purchase any
option or contract to sell, grant any option, right or warrant to purchase or
otherwise transfer or dispose of any share of Class A Common Stock or any
securities convertible into or exercisable or exchangeable for Class A Common
Stock or file any registration statement under the 1933 Act with respect to any
of the foregoing or (ii) enter into any swap or any other agreement or any
transaction that transfers, in whole or in part, directly or indirectly, the
economic consequence of ownership of the Class A Common Stock, whether any such
swap or transaction described in clause (i) or (ii) above is to be settled by
delivery of Class A Common Stock or such other
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securities, in cash or otherwise. The foregoing sentence shall not apply to the
Securities to be sold hereunder or under the U.S. Purchase Agreement, the
Company's Global Ownership Program or the Iridium LLC Share Option Plan, each as
described in the Prospectuses. In addition, the foregoing restriction shall not
apply to the issuance of warrants in connection with any offering of debt
securities of the Company; provided, (i) such warrants have a per share exercise
price not lower than the average of the closing bid and asking price of the
Class A Common Stock on the Nasdaq National Market on the date of issuance and
(ii) such warrants are not exercisable earlier than 180 days from the date
hereof.
(k) Reporting Requirements. The Company, during the period when the
Prospectuses are required to be delivered under the 1933 Act or the 1934 Act,
will file all documents required to be filed with the Commission pursuant to the
1934 Act within the time periods required by the 1934 Act and the rules and
regulations of the Commission thereunder.
(l) Compliance with NASD Rules. The Company hereby agrees that it will
ensure that the Reserved Securities will be restricted as required by the
National Association of Securities Dealers, Inc. (the "NASD") or the NASD rules
from sale, transfer, assignment, pledge or hypothecation for a period of three
months following the date of this Agreement. The Underwriters will notify the
Company as to which persons will need to be so restricted. At the request of the
Underwriters, the Company will direct the transfer agent to place a stop
transfer restriction upon such securities for such period of time. Should the
Company release, or seek to release, from such restrictions any of the Reserved
Securities, the Company agrees to reimburse the Underwriters for any reasonable
expenses (including, without limitation, legal expenses) they incur in
connection with such release.
(m) Compliance with Rule 463. The Company will file with the Commission
such reports on Form SR as may be required pursuant to Rule 463 of the 1933 Act
Regulations.
(n) Exchange Agreement. During a period of 180 days from the date of
the Prospectuses, the Company will not enter into any amendment to, or waive the
application of any provision of, the Exchange Agreement or take any action that
would have any effect similar to the foregoing, in each case if the effect
thereof is to permit exchanges of Class 1 Interests for Class A Stock during
such 180-day period.
SECTION 4. Covenants of Iridium.
Iridium covenants and agrees with each International Manager as follows:
(a) Exchange Agreement. During a period of 180 days from the date of
the Prospectuses, Iridium will not enter into any amendment to, or waive the
application of any provision of, the Exchange Agreement or take any action that
would have any effect similar to the foregoing.
(b) Use of Proceeds. Iridium shall apply the proceeds of the sale of
its Class 1 Interests to the Company substantially as set forth in the
Prospectuses.
SECTION 5. Payment of Expenses. (a) Expenses. Iridium will pay all
expenses incident to the performance of the obligations of Iridium and the
Company under this Agreement, including
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(i) the preparation, printing and filing of the Registration Statement
(including financial statements and exhibits) as originally filed and of each
amendment thereto, (ii) the preparation, printing and delivery to the
Underwriters of this Agreement, any Agreement among Underwriters and such other
documents as may be required in connection with the offering, purchase, sale,
issuance or delivery of the Securities, (iii) the preparation, issuance and
delivery of the certificates for the Securities to the Underwriters, including
any stock or other transfer taxes and any stamp or other duties payable upon the
sale, issuance or delivery of the Securities to the Underwriters and the
transfer of the Securities between the U.S. Underwriters and the International
Managers, (iv) the fees and disbursements of the Company's and Iridium's
counsel, accountants and other advisors, (v) the qualification of the Securities
under securities laws in accordance with the provisions of Section 3(f) hereof,
including filing fees and the reasonable fees and disbursements of counsel for
the Underwriters in connection therewith and in connection with the preparation
of the Blue Sky Survey and any supplement thereto, (vi) the printing and
delivery to the Underwriters of copies of each preliminary prospectus, any Term
Sheets and of the Prospectuses and any amendments or supplements thereto, (vii)
the preparation, printing and delivery to the Underwriters of copies of the Blue
Sky Survey and any supplement thereto, (viii) the fees and expenses of any
transfer agent or registrar for the Securities, (ix) the filing fees incident
to, and the reasonable fees and disbursements of counsel to the Underwriters in
connection with, the review by the National Association of Securities Dealers,
Inc. (the "NASD") of the terms of the sale of the Securities, (x) the fees and
expenses incurred in connection with the inclusion of the Securities in the
Nasdaq National Market and (xi) all costs and expenses of the Underwriters,
including the fees and disbursements of counsel for the Underwriters, in
connection with matters related to the Reserved Securities which are designated
by Iridium for sale to employees and others having a business relationship with
Iridium. It is understood, however, that except as provided in this Section,
Section 7 and Section 8, the International Managers will pay all of their own
costs and expenses, including the fees and expenses of their counsel, transfer
taxes on resale of any of the securities and any advertising expenses connected
with any offers they make.
(b) Termination of Agreement. If this Agreement is terminated by the
Lead Managers in accordance with the provisions of Section 6 or Section 10(a)(i)
hereof, Iridium shall reimburse the International Managers for all of their
reasonable out-of-pocket expenses, including the reasonable fees and
disbursements of counsel for the International Managers.
SECTION 6. Conditions of International Managers' Obligations. The
obligations of the several International Managers hereunder are subject to the
accuracy of the representations and warranties of the Company and Iridium
contained in Section 1 hereof or in certificates of any officer of the Company
or Iridium delivered pursuant to the provisions hereof, to the performance by
the Company of its covenants and other obligations hereunder, and to the
following further conditions:
(a) Effectiveness of Registration Statement. The Registration
Statement, including any Rule 462(b) Registration Statement, has become
effective and at Closing Time no stop order suspending the effectiveness of the
Registration Statement shall have been issued under the 1933 Act or proceedings
therefor initiated or threatened by the Commission, and any request on the part
of the Commission for additional information shall have been complied with to
the reasonable satisfaction of counsel to the International Managers. A
prospectus containing the Rule 430A
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Information shall have been filed with the Commission in accordance with Rule
424(b) (or a post-effective amendment providing such information shall have been
filed and declared effective in accordance with the requirements of Rule 430A)
or, if the Company has elected to rely upon Rule 434, a Term Sheet shall have
been filed with the Commission in accordance with Rule 424(b).
(b) Letter and Opinion of Counsel for the Company and Iridium. At
Closing Time, the Lead Managers shall have received the favorable opinion and
letter, dated as of Closing Time, of Xxxxxxxx & Xxxxxxxx, counsel for the
Company and Iridium, in form and substance satisfactory to counsel for the
International Managers, together with signed or reproduced copies of such
letters for each of the other International Managers to the effect set forth in
Exhibit A-1 hereto.
(c) Opinion of Bermuda Counsel for the Company. At Closing Time, the
Lead Managers shall have received the favorable opinion, dated as of Closing
Time, of Xxxxxxx Xxxx & Xxxxxxx, Bermuda counsel for the Company, in form and
substance satisfactory to counsel for the International Managers, together with
signed or reproduced copies of such letter for each of the other International
Managers to the effect set forth in Exhibit A-2 hereto.
(d) Opinion of Regulatory Counsel for Motorola. At Closing Time, the
Lead Managers shall have received the favorable opinion, dated as of Closing
Time, of Steptoe & Xxxxxxx LLP, regulatory counsel for Motorola Satellite
Communications, Inc. as FCC license holder, in form and substance satisfactory
to counsel for the International Managers, together with signed or reproduced
copies of such letter for each of the other International Managers to the effect
set forth in Exhibit A-3 hereto.
(e) Opinion of Assistant Secretary of the Company and General Counsel
of Iridium. At Closing Time, the Lead Managers shall have received the favorable
opinion, dated as of Closing Time, of F. Xxxxxx Xxxxxx, Esq., Assistant
Secretary of the Company and General Counsel of Iridium, in form and substance
satisfactory to counsel for the International Managers, together with signed or
reproduced copies of such letter for each of the other International Managers to
the effect set forth in Exhibit A-4 hereto.
(f) Opinion of Counsel for International Managers. At Closing Time, the
Lead Managers shall have received the favorable opinion, dated as of Closing
Time, of Fried, Frank, Harris, Xxxxxxx & Xxxxxxxx, counsel for the International
Managers, together with signed or reproduced copies of such letter for each of
the other International Managers with respect to the matters set forth in
clauses (i) and (iv) of Exhibit A-1 hereto and to the effect set forth in
Exhibit B hereto. In giving such opinion such counsel may rely, as to all
matters governed by the laws of jurisdictions other than the law of the State of
New York and the federal law of the United States and the Delaware Act, upon the
opinions of counsel satisfactory to the Lead Managers. Such counsel may also
state that, insofar as such opinion involves factual matters, they have relied,
to the extent they deem proper, upon certificates of officers of the Company and
Iridium and certificates of public officials.
(g) Opinion of Regulatory Counsel for the International Managers. At
Closing Time, the Lead Managers shall have received the favorable opinion, dated
as of Closing Time, of Goldberg, Godles, Wiener & Xxxxxx, regulatory counsel for
the International Managers together
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with signed or reproduced copies of such letter for each of the other
International Managers to such effect as the International Managers may
reasonably request.
(h) Officers' Certificates. At Closing Time, there shall not have been,
since the date hereof or since the respective dates as of which information is
given in the Prospectuses, any material adverse change in the condition,
financial or otherwise, or in the earnings, business affairs or business
prospects of the Company or Iridium, whether or not arising in the ordinary
course of business, and the Lead Managers shall have received a certificate of
the President or a Vice President of each of the Company and Iridium and of the
chief financial or chief accounting officer of each of the Company and Iridium,
dated as of Closing Time, to the effect that (i) there has been no such material
adverse change, (ii) the representations and warranties in Section 1(a) hereof
are true and correct with the same force and effect as though expressly made at
and as of Closing Time, (iii) the Company or Iridium, as the case may be, has
complied with all agreements and satisfied all conditions on its part to be
performed or satisfied at or prior to Closing Time, and (iv) no stop order
suspending the effectiveness of the Registration Statement has been issued and
no proceedings for that purpose have been instituted or are pending or are
contemplated by the Commission.
(i) Accountant's Comfort Letter. At the time of the execution of this
Agreement, the Lead Managers shall have received from KPMG Peat Marwick LLP a
letter dated such date, in form and substance satisfactory to the Lead Managers,
together with signed or reproduced copies of such letter for each of the other
International Managers containing statements and information of the type
ordinarily included in accountants' "comfort letters" to underwriters with
respect to the financial statements and certain financial information contained
in the Registration Statement and the Prospectuses.
(j) Bring-down Comfort Letter. At Closing Time, the Lead Managers shall
have received from KPMG Peat Marwick LLP a letter, dated as of Closing Time, to
the effect that they reaffirm the statements made in the letter furnished
pursuant to subsection (i) of this Section (updated to include the final
Prospectuses), except that the specified date referred to shall be a date not
more than three business days prior to Closing Time.
(k) Approval of Listing. At Closing Time, the Securities shall have
been approved for inclusion in the Nasdaq National Market, subject only to
official notice of issuance.
(l) No Objection. At or prior to Closing Time, the NASD shall have
confirmed that it has not raised any objection with respect to the fairness and
reasonableness of the underwriting terms and arrangements.
(m) Motorola Certificate. At Closing Time, the Lead Managers shall have
received a certificate, dated as of Closing Time, of the President or a Vice
President of Motorola, Inc., in form and substance satisfactory to counsel for
the International Managers, as to the accuracy of the statements attributed to
Motorola in the Prospectuses, and to such other matters relating to Motorola as
counsel for the International Managers may reasonably request (a draft of such
certificate is attached as Exhibit C hereto).
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(n) Purchase of Initial U.S. Securities. Contemporaneously with the
purchase by the International Managers of the Initial International Securities
under this Agreement, the U.S. Underwriters shall have purchased the Initial
U.S. Securities under the U.S. Purchase Agreement.
(o) Conditions to Purchase of International Option Securities. In the
event that the International Managers exercise their option provided in Section
2(b) hereof to purchase all or any portion of the International Option
Securities, the representations and warranties of the Company and Iridium
contained herein and the statements in any certificates furnished by the Company
or Iridium hereunder shall be true and correct as of each Date of Delivery and,
at the relevant Date of Delivery, the Lead Managers shall have received:
(i) Officers' Certificates. A certificate, dated such Date of
Delivery, of the President or a Vice President of each of the
Company and Iridium and of the chief financial or chief
accounting officer of each of the Company and Iridium
confirming that the certificate or certificates delivered at
Closing Time pursuant to Section 6(h) hereof remain true and
correct as of such Date of Delivery.
(ii) Opinion of Counsel for the Company and Iridium. The
favorable opinion of each of Xxxxxxxx & Xxxxxxxx, counsel for
the Company and Iridium, Xxxxxxx Xxxx & Xxxxxxx, Bermuda
counsel for the Company, Steptoe & Xxxxxxx LLP, regulatory
counsel for Motorola Satellite Communications, Inc. as FCC
license holder, and F. Xxxxxx Xxxxxx, Assistant Secretary of
the Company and General Counsel of Iridium, each in form and
substance satisfactory to counsel for the International
Managers, dated such Date of Delivery, relating to the
International Option Securities to be purchased on such Date
of Delivery and otherwise to the same effect as the opinions
required by Sections 6(b), 6(c), 6(d) and 6(e) hereof,
respectively.
(iii) Opinion of Counsel for International Managers. The
favorable opinion of each of Fried, Frank, Harris, Xxxxxxx &
Xxxxxxxx, counsel for the International Managers and Goldberg,
Godles, Wiener & Xxxxxx, regulatory counsel for the
International Managers, each dated such Date of Delivery,
relating to the International Option Securities to be
purchased on such Date of Delivery and otherwise to the same
effect as the opinions required by Sections 6(f) and 6(g)
hereof, respectively.
(iv) Bring-down Comfort Letter. A letter from KPMG Peat
Marwick LLP, in form and substance satisfactory to the Lead
Managers and dated such Date of Delivery, substantially in the
same form and substance as the letter furnished to the Lead
Managers pursuant to Section 6(j) hereof, except that the
"specified date" in the letter furnished pursuant to this
paragraph shall be a date not more than five days prior to
such Date of Delivery.
(v) Motorola Certificate. A certificate, dated such Date of
Delivery, of the president or a vice president of Motorola,
Inc. confirming that the certificate delivered at Closing Time
pursuant to 6(m) hereof remains true and correct as of such
Date of Delivery.
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(p) Transactions. At or prior to Closing Time, the Transactions shall
have been duly and validly effected and all corporate proceedings and legal
matters incident to the Transactions shall be satisfactory to counsel for the
International Managers.
(q) Additional Documents. At Closing Time and at each Date of Delivery
counsel for the International Managers shall have been furnished with such
documents and opinions as they may require for the purpose of enabling them to
pass upon the issuance and sale of the Securities as herein contemplated, or in
order to evidence the accuracy of any of the representations or warranties, or
the fulfillment of any of the conditions, herein contained.
(r) Termination of Agreement. If any condition specified in this
Section shall not have been fulfilled when and as required to be fulfilled, this
Agreement, or, in the case of any condition to the purchase of International
Option Securities on a Date of Delivery which is after the Closing Time, the
obligations of the several International Managers to purchase the relevant
Option Securities may be terminated by the Lead Managers by notice to the
Company at any time at or prior to Closing Time or such Date of Delivery, as the
case may be, and such termination shall be without liability of any party to any
other party except as provided in Section 4 and except that Sections 1, 6, 7 and
8 shall survive any such termination and remain in full force and effect.
(s) Lock-up Agreements. At the date of this Agreement, the Lead
Managers shall have received an agreement substantially in the form of Exhibit D
hereto signed by each of the persons specified on Schedule C hereto.
SECTION 7. Indemnification.
(a) Indemnification of International Managers. Each of the Company and
Iridium agrees to indemnify and hold harmless each International Manager and
each person, if any, who controls any International Manager within the meaning
of Section 15 of the 1933 Act or Section 20 of the 1934 Act as follows:
(i) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, arising out of any untrue statement or
alleged untrue statement of a material fact contained in the
Registration Statement (or any amendment thereto), including the Rule
430A Information and the Rule 434 Information, if applicable, or the
omission or alleged omission therefrom of a material fact required to
be stated therein or necessary to make the statements therein not
misleading or arising out of any untrue statement or alleged untrue
statement of a material fact included in any preliminary prospectus or
the Prospectuses (or any amendment or supplement thereto), or the
omission or alleged omission therefrom of a material fact necessary in
order to make the statements therein, in the light of the circumstances
under which they were made, not misleading;
(ii) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, arising out of (A) the violation of
any applicable laws or regulations of foreign jurisdictions where
Reserved Securities have been offered and (B) any untrue statement or
alleged untrue statement of a material fact included in the supplement
or prospectus wrapper material distributed in Argentina, Brazil,
Canada, Hong Kong, Indonesia, Japan, Korea, the
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United Kingdom and Venezuela in connection with the reservation and
sale of the Reserved Securities to eligible employees of the Company
and Iridium and persons having business relationships with Iridium or
the omission or alleged omission therefrom of a material fact necessary
to make the statements therein, when considered in conjunction with the
Prospectuses or preliminary prospectuses, not misleading; (iii) against
any and all loss, liability, claim, damage and expense whatsoever, as
incurred, to the extent of the aggregate amount paid in settlement of
any litigation, or any investigation or proceeding by any governmental
agency or body, commenced or threatened, or of any claim whatsoever
based upon any such untrue statement or omission, or any such alleged
untrue statement or omission or in connection with any violation of the
nature referred to in Section 7(a)(ii)(A) hereof; provided that
(subject to Section 7(d) below) any such settlement is effected with
the written consent of the Company and Iridium; and
(iii) against any and all expense whatsoever, as incurred
(including subject to Section 7(c) hereof the reasonable fees and
disbursements of counsel chosen by Xxxxxxx Xxxxx), reasonably incurred
in investigating, preparing or defending against any litigation, or any
investigation or proceeding by any governmental agency or body,
commenced or threatened, or any claim whatsoever based upon any such
untrue statement or omission, or any such alleged untrue statement or
omission or in connection with any violation of the nature referred to
in Section 7(a)(ii)(A) hereof, to the extent that any such expense is
not paid under (i), (ii) or (iii) above;
provided, however, that this indemnity agreement shall not apply to any loss,
liability, claim, damage or expense to the extent arising out of any untrue
statement or omission or alleged untrue statement or omission made in reliance
upon and in conformity with written information furnished to the Company by any
International Manager through the Lead Managers expressly for use in the
Registration Statement (or any amendment thereto), including the Rule 430A
Information and the Rule 434 Information, if applicable, or any preliminary
prospectus or the International Prospectus (or any amendment or supplement
thereto) and provided, further, that neither Iridium nor the Company will be
liable to an International Manager with respect to any preliminary prospectus to
the extent that Iridium or the Company shall sustain the burden of proving that
any such loss, liability, claim, damage or expense resulted from the fact that
such International Manager in contravention of a requirement of this Agreement
or applicable law, sold Securities to a person to whom such International
Manager failed to send or give, at or prior to Closing Time, a copy of the
International Prospectus as then amended or supplemented if the Company has
previously furnished copies thereof (sufficiently in advance of Closing Time to
allow for distribution by Closing Time) to the International Manager and the
loss, liability, claim, damage or expense of such International Manager resulted
from an untrue statement or omission or alleged untrue statement or omission of
a material fact contained in or omitted from the preliminary prospectus which
was corrected in the International Prospectus as, if applicable, amended or
supplemented prior to Closing Time.
(b) Indemnification of Company, Iridium, Directors and Officers. Each
International Manager severally agrees to indemnify and hold harmless the
Company and Iridium, their directors, each of their officers who signed the
Registration Statement, and each person, if any, who controls the Company or
Iridium within the meaning of Section 15 of the 1933 Act or Section 20 of the
1934 Act against any and all loss, liability, claim, damage and expense
described in the indemnity
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contained in subsection (a) of this Section, as incurred, but only with respect
to untrue statements or omissions, or alleged untrue statements or omissions,
made in the Registration Statement (or any amendment thereto), including the
Rule 430A Information and the Rule 434 Information, if applicable, or any
preliminary international prospectus or the International Prospectus (or any
amendment or supplement thereto) in reliance upon and in conformity with written
information furnished to the Company by such International Manager through the
Lead Managers expressly for use in the Registration Statement (or any amendment
thereto) or such preliminary prospectus or the International Prospectus (or any
amendment or supplement thereto).
(c) Actions against Parties; Notification. Each indemnified party shall
give notice as promptly as reasonably practicable to each indemnifying party of
any action commenced against it in respect of which indemnity may be sought
hereunder, but failure to so notify an indemnifying party shall not relieve such
indemnifying party from any liability hereunder to the extent it is not
materially prejudiced as a result thereof and in any event shall not relieve it
from any liability which it may have otherwise than on account of this indemnity
agreement. In the case of parties indemnified pursuant to Section 7(a) above,
counsel to the indemnified parties shall be selected by Xxxxxxx Xxxxx, and, in
the case of parties indemnified pursuant to Section 7(b) above, counsel to the
indemnified parties shall be selected by the Company and Iridium. An
indemnifying party may participate at its own expense in the defense of any such
action; provided, however, that counsel to the indemnifying party shall not
(except with the consent of the indemnified party) also be counsel to the
indemnified party. In no event shall the indemnifying parties be liable for fees
and expenses of more than one counsel (in addition to any local counsel)
separate from their own counsel for all indemnified parties in connection with
any one action or separate but similar or related actions in the same
jurisdiction arising out of the same general allegations or circumstances. No
indemnifying party shall, without the prior written consent of the indemnified
parties, settle or compromise or consent to the entry of any judgment with
respect to any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or any claim whatsoever in
respect of which indemnification or contribution could be sought under this
Section 7 or Section 8 hereof (whether or not the indemnified parties are actual
or potential parties thereto), unless such settlement, compromise or consent (i)
includes an unconditional release of each indemnified party from all liability
arising out of such litigation, investigation, proceeding or claim and (ii) does
not include a statement as to or an admission of fault, culpability or a failure
to act by or on behalf of any indemnified party.
(d) Settlement without Consent if Failure to Reimburse. If at any time
an indemnified party shall have requested an indemnifying party to reimburse the
indemnified party for fees and expenses of counsel, such indemnifying party
agrees that it shall be liable for any settlement of the nature contemplated by
Section 7(a)(ii) or Section 7(a)(iii) effected without its written consent if
(i) such settlement is entered into more than 45 days after receipt by such
indemnifying party of the aforesaid request, (ii) such indemnifying party shall
have received notice of the terms of such settlement at least 30 days prior to
such settlement being entered into and (iii) such indemnifying party shall not
have reimbursed such indemnified party in accordance with such request prior to
the date of such settlement.
(e) Indemnification for Reserved Securities. In connection with the
offer and sale of the Reserved Securities, each of the Company and Iridium
jointly and severally agrees, promptly upon
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a request in writing, to indemnify and hold harmless the Underwriters from and
against any and all losses, liabilities, claims, damages and expenses incurred
by them as a result of (i) the failure of eligible employees of the Company and
Iridium and persons having business relationships with Iridium to pay for and
accept delivery of Reserved Securities following the effectiveness of the
Registration Statement, were subject to a properly confirmed agreement to
purchase and (ii) the violation of any securities laws of foreign jurisdictions
in connection with any offer and/or sale of Reserved Securities (including,
without limitation, all regulations governing Xxxxxxx Xxxxx in its capacity as
"authorized person" under the Financial Services Act in the United Kingdom).
SECTION 8. Contribution. If the indemnification provided for in Section
7 hereof is for any reason unavailable to or insufficient to hold harmless an
indemnified party in respect of any losses, liabilities, claims, damages or
expenses referred to therein, then each indemnifying party shall contribute to
the aggregate amount of such losses, liabilities, claims, damages and expenses
incurred by such indemnified party, as incurred, (i) in such proportion as is
appropriate to reflect the relative benefits received by the Company and Iridium
on the one hand and the International Managers on the other hand from the
offering of the Securities pursuant to this Agreement or (ii) if the allocation
provided by clause (i) is not permitted by applicable law, in such proportion as
is appropriate to reflect not only the relative benefits referred to in clause
(i) above but also the relative fault of the Company and Iridium on the one hand
and of the International Managers on the other hand in connection with the
statements or omissions, or in connection with any violation of the nature
referred to in Section 7(a)(ii)(A) hereof, which resulted in such losses,
liabilities, claims, damages or expenses, as well as any other relevant
equitable considerations.
The relative benefits received by the Company and Iridium on the one
hand and the International Managers on the other hand in connection with the
offering of the International Securities pursuant to this Agreement shall be
deemed to be in the same respective proportions as the total net proceeds from
the offering of the International Securities pursuant to this Agreement (before
deducting expenses) received by the Company and the total underwriting discount
received by the International Managers, in each case as set forth on the cover
of the International Prospectus, or, if Rule 434 is used, the corresponding
location on the Term Sheet, bear to the aggregate initial public offering price
of the International Securities as set forth on such cover.
The relative fault of the Company and Iridium on the one hand and the
International Managers on the other hand shall be determined by reference to,
among other things, whether any such untrue or alleged untrue statement of a
material fact or omission or alleged omission to state a material fact relates
to information supplied by the Company and Iridium or by the International
Managers and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission or any violation of
the nature referred to in Section 7(a)(ii)(A) hereof.
The Company, Iridium and the International Managers agree that it would
not be just and equitable if contribution pursuant to this Section 8 were
determined by pro rata allocation (even if the International Managers were
treated as one entity for such purpose) or by any other method of allocation
which does not take account of the equitable considerations referred to above in
this Section 8. The aggregate amount of losses, liabilities, claims, damages and
expenses incurred by an indemnified party and referred to above in this Section
8 shall be deemed to include any legal or other expenses reasonably incurred by
such indemnified party in investigating, preparing or
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defending against any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or any claim whatsoever
based upon any such untrue or alleged untrue statement or omission or alleged
omission.
Notwithstanding the provisions of this Section 8, no International
Manager shall be required to contribute any amount in excess of the amount by
which the total price at which the International Securities underwritten by it
and distributed to the public were offered to the public exceeds the amount of
any damages which such International Managers has otherwise been required to pay
by reason of any such untrue or alleged untrue statement or omission or alleged
omission.
No person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the 0000 Xxx) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation.
For purposes of this Section 8, each person, if any, who controls an
International Managers within the meaning of Section 15 of the 1933 Act or
Section 20 of the 1934 Act shall have the same rights to contribution as such
International Manager, and each director of the Company or Iridium, each officer
of the Company or Iridium who signed the Registration Statement, and each
person, if any, who controls the Company or Iridium within the meaning of
Section 15 of the 1933 Act or Section 20 of the 1934 Act shall have the same
rights to contribution as the Company. The International Managers' respective
obligations to contribute pursuant to this Section 8 are several in proportion
to the number of Initial International Securities set forth opposite their
respective names in Schedule A hereto and not joint.
SECTION 9. Representations, Warranties and Agreements to Survive
Delivery. All representations, warranties and agreements contained in this
Agreement or in certificates of officers of the Company or Iridium submitted
pursuant hereto, shall remain operative and in full force and effect, regardless
of any investigation made by or on behalf of any International Manager or
controlling person, or by or on behalf of the Company or Iridium, and shall
survive delivery of the Securities to the International Managers.
SECTION 10. Termination of Agreement.
(a) Termination; General. The Lead Managers may terminate this
Agreement, by notice to the Company, at any time at or prior to Closing Time (i)
if there has been, since the time of execution of this Agreement or since the
respective dates as of which information is given in the International
Prospectus, any material adverse change in the condition, financial or
otherwise, or in the earnings, business affairs or business prospects of the
Company and Iridium considered as one enterprise, whether or not arising in the
ordinary course of business, or (ii) if there has occurred any material adverse
change in the financial markets in the United States or the international
financial markets, any outbreak of hostilities or escalation thereof or other
calamity or crisis or any change or development involving a prospective change
in national or international political, financial or economic conditions, in
each case the effect of which is such as to make it, in the judgment of the Lead
Managers, impracticable to market the Securities or to enforce contracts for the
sale of the Securities, or (iii) if trading in any securities of the Company has
been suspended or materially limited by the Commission or the Nasdaq National
Market or Bermuda, or if trading generally on the American Stock Exchange or the
New York Stock Exchange or in the Nasdaq National Market
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has been suspended or materially limited, or minimum or maximum prices for
trading have been fixed, or maximum ranges for prices have been required, by any
of said exchanges or by such system or by order of the Commission, the National
Association of Securities Dealers, Inc. or any other governmental authority, or
(iv) if a banking moratorium has been declared by either Federal or New York
authorities.
(b) Liabilities. If this Agreement is terminated pursuant to this
Section, such termination shall be without liability of any party to any other
party except as provided in Section 5 hereof, and provided further that Sections
1, 7, 8 and 9 shall survive such termination and remain in full force and
effect.
SECTION 11. Default by One or More of the International Managers. If
one or more of the International Managers shall fail at Closing Time or a Date
of Delivery to purchase the Securities which it or they are obligated to
purchase under this Agreement (the "Defaulted Securities"), the Lead Managers
shall have the right, within 24 hours thereafter, to make arrangements for one
or more of the non-defaulting International Managers, or any other underwriters,
to purchase all, but not less than all, of the Defaulted Securities in such
amounts as may be agreed upon and upon the terms herein set forth; if, however,
the Lead Managers shall not have completed such arrangements within such 24-hour
period, then:
(a) if the number of Defaulted Securities does not exceed 10% of the
number of International Securities to be purchased on such date, each of the
non-defaulting International Managers shall be obligated, severally and not
jointly, to purchase the full amount thereof in the proportions that their
respective underwriting obligations hereunder bear to the underwriting
obligations of all non-defaulting International Managers, or
(b) if the number of Defaulted Securities exceeds 10% of the number of
International Securities to be purchased on such date, this Agreement or, with
respect to any Date of Delivery which occurs after the Closing Time, the
obligation of the International Managers to purchase and of the Company to sell
the Option Securities to be purchased and sold on such Date of Delivery shall
terminate without liability on the part of any non-defaulting International
Manager.
No action taken pursuant to this Section shall relieve any defaulting
International Manager from liability in respect of its default.
In the event of any such default which does not result in a termination
of this Agreement or, in the case of a Date of Delivery which is after the
Closing Time, which does not result in a termination of the obligation of the
International Managers to purchase and the Company to sell the relevant
International Option Securities, as the case may be, either the Lead Managers or
the Company shall have the right to postpone Closing Time or the relevant Date
of Delivery, as the case may be, for a period not exceeding seven days in order
to effect any required changes in the Registration Statement or Prospectus or in
any other documents or arrangements. As used herein, the term "International
Manager" includes any person substituted for an International Manager under this
Section 11.
SECTION 12. Notices. All notices and other communications hereunder
shall be in writing and shall be deemed to have been duly given if mailed or
transmitted by any standard form of
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telecommunication. Notices to the International Managers shall be directed to
the Lead Managers at North Tower, World Financial Center, New York, New York
10281-1201, attention of _____________; notices to the Company shall be directed
to it at Xxxxxxxxx Xxxxx, 0 Xxxxxx Xxxxxx, Xxxxxxxx XX 11, Bermuda, attention of
the Secretary (with a copy to Iridium); and notices to Iridium shall be directed
to it at 0000X Xxxxxx, X.X., Xxxxxxxxxx X.X. 00000, attention of General
Counsel.
SECTION 13. Parties. This Agreement shall each inure to the benefit of
and be binding upon the International Managers, the Company and Iridium and
their respective successors. Nothing expressed or mentioned in this Agreement is
intended or shall be construed to give any person, firm or corporation, other
than the International Managers, the Company and Iridium and their respective
successors and the controlling persons and officers and directors referred to in
Sections 7 and 8 and their heirs and legal representatives, any legal or
equitable right, remedy or claim under or in respect of this Agreement or any
provision herein contained. This Agreement and all conditions and provisions
hereof are intended to be for the sole and exclusive benefit of the
International Managers, the Company and Iridium and their respective successors,
and said controlling persons and officers and directors and their heirs and
legal representatives, and for the benefit of no other person, firm or
corporation. No purchaser of Securities from any International Manager shall be
deemed to be a successor by reason merely of such purchase.
SECTION 14. GOVERNING LAW AND TIME. THIS AGREEMENT SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK. SPECIFIED
TIMES OF DAY REFER TO NEW YORK CITY TIME.
SECTION 15. Effect of Headings. The Article and Section headings herein
and the Table of Contents are for convenience only and shall not affect the
construction hereof.
-29-
36
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to the Company a counterpart hereof, whereupon
this instrument, along with all counterparts, will become a binding agreement
between the International Managers and the Company in accordance with its terms.
Very truly yours,
IRIDIUM WORLD COMMUNICATIONS LTD.
By
Name:
Title:
IRIDIUM LLC
By
Name:
Title:
CONFIRMED AND ACCEPTED, as of the date first above written:
XXXXXXX XXXXX INTERNATIONAL
XXXXXXXXX, LUFKIN & XXXXXXXX SECURITIES CORPORATION
XXXXXXX SACHS INTERNATIONAL
By: XXXXXXX XXXXX INTERNATIONAL
By_________________________________________
Authorized Signatory
For themselves and as Lead Managers of the other International Managers named in
Schedule A hereto.
-30-
37
SCHEDULE A
Number of
Initial International
Securities
Name of International Manager ----------
-----------------------------
Xxxxxxx Xxxxx International ..........................................
Xxxxxxxxx, Lufkin & Xxxxxxxx Securities Corporation ..................
Xxxxxxx Sachs International ..........................................
---------
Total ................................................................ 2,000,000
=========
-1-
38
SCHEDULE B
Iridium World Communications Ltd.
2,000,000 Shares of Class A Common Stock
(Par Value $.01 Per Share)
1. The initial public offering price per share for the Securities,
determined as provided in said Section 2, shall be $____________.
2. The purchase price per share for the International Securities to be
paid by the several International Managers shall be $____________, being an
amount equal to the initial public offering price set forth above less
$____________ per share; provided that the purchase price per share for any
International Option Securities purchased upon the exercise of the
over-allotment option described in Section 2(b) shall be reduced by an amount
per share equal to any dividends or distributions declared by the Company and
payable on the Initial International Securities but not payable on the
International Option Securities.
-2-
39
SCHEDULE C
List of persons and entities
subject to lock-up
Xxxxxx X. Xxxxxx
Xxxxxx X. Xxxxxxx
Xxx Xxxxxxx
-1-
40
Exhibit A-1
FORM OF OPINION OF COMPANY'S AND IRIDIUM'S COUNSEL
TO BE DELIVERED PURSUANT TO
SECTION 6(b)
(i) Iridium has been duly formed and is an existing limited
liability company in good standing under the laws of the State of
Delaware, with all requisite limited liability company power and
authority to own its properties and to conduct its business as
described in the Prospectuses and to enter into and perform its
obligations under the U.S. Purchase Agreement, the International
Purchase Agreement and the 1997 Governance Agreements.
(ii) Iridium has been duly qualified as a foreign limited
liability company to transact business and is in good standing under
the laws of each jurisdiction set forth in an officer's certificate
delivered to you on the Closing Date specifying the jurisdictions in
which Iridium owns or leases properties or conducts any business (such
counsel shall have no responsibility for the matters set forth in such
officer's certificate and such counsel shall be entitled to rely in
respect of the opinion in this clause upon opinions of local counsel
and in respect of matters of fact upon certificates of officers of
Iridium).
(iii) The LLC Agreement provides for the issuance of up to
250,000,000 Class 1 Interests, 50,000 Series M Class 2 Interests and
300,000 additional Class 2 Interests, of which ______, ______ and
______ have been authorized for issuance. The outstanding limited
liability company interests of Iridium (i) are shown as outstanding
under "Actual" in the Prospectus under the caption
"Capitalization-Iridium" (ii) have been duly authorized and validly
issued and are fully paid and non-assessable.
(iv) The U.S. Purchase Agreement and the International
Purchase Agreement have been duly authorized, executed and delivered by
Iridium.
(v) All regulatory consents, authorizations, approvals and
filings required to be obtained or made by the Company or Iridium under
the Federal laws of the United States, the laws of the State of New
York and the Limited Liability Company Act of the State of Delaware for
the issuance, sale and delivery of the Securities by the Company to the
Underwriters have been obtained or made; provided, however, that, for
purposes of this clause (v), such counsel shall express no opinion with
respect to Federal or state communications laws.
(vi) The execution, delivery and performance of the U.S.
Purchase Agreement, the International Purchase Agreement, the 1997
Subscription Agreement and the consummation of the transactions herein
and therein contemplated (including the issuance and sale of the
Securities, and the use of the proceeds from the sale of the Securities
as described in the Prospectuses under the caption "Use Of Proceeds")
do not and will not (i) violate, conflict with or result in a breach or
violation of any of the terms or provisions of, or constitute a default
under, the Principal Agreements nor will such action result in any
violation of the provisions of the certificate of formation or limited
liability company agreement of Iridium or (ii) violate any Federal law
of the United States or the laws of the
A-1-
41
State of New York or the Limited Liability Company Act of the State of
Delaware, in each case applicable to Iridium; provided, however, that,
for purposes of this paragraph (vi), such counsel shall express no
opinion with respect to Federal or state securities laws, other
antifraud laws, fraudulent transfer laws or communications laws;
provided, further, that such counsel shall express no opinion as to
bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium
and similar laws of general applicability relating to or affecting
creditors' rights or with respect to any provision of such agreements
purporting to require indemnification of, or contribution to, the
losses, damages, claims, expenses or liability of any person.
(vii) The Company is not, and upon the issuance and sale of
the Securities as contemplated in the Purchase Agreements and the
application of the net proceeds therefrom as described in the
Prospectuses will not be, an "investment company" as such term is
defined in the 1940 Act.
Such counsel shall also furnish you with a letter to the
effect that as counsel to the Company and Iridium, they reviewed the
Registration Statement and the Prospectuses, participated in
discussions with representatives of the Underwriters, the Company,
Iridium and their accountants, Motorola and the Company's Bermuda
counsel and advised the Company and Iridium as to the requirements of
the 1933 Act and the applicable rules and regulations thereunder;
between the effectiveness of the registration statement and Closing
Time, such counsel participated in further discussions with
representatives of the Underwriters, the Company, Iridium and their
accountants, and Motorola, in which the contents of certain portions of
the Prospectuses and related matters were discussed, and reviewed
certain documents filed by the Company with the Commission,
certificates of certain officers of the Company, an opinion addressed
to the Underwriters from Steptoe & Xxxxxxx and a letter from the
Company's and Iridium's independent accountants; on the basis of the
information that such counsel gained in the course of the performance
of the services referred to above, considered in the light of such
counsel's understanding of the applicable law and the experience such
counsel has gained through their practice under the 1933 Act, such
counsel will confirm to you that in such counsel's opinion, the
Registration Statement, as of its effective date, and the Prospectuses,
as of the date of the Prospectuses, appeared on their face to be
appropriately responsive in all material respects to the requirements
of the 1933 Act and the 1933 Act Regulations; further, nothing that
came to such counsel's attention in the course of such review has
caused such counsel to believe that the Registration Statement, as of
its effective date, and the Prospectuses, as of such effective date,
contained any untrue statement of a material fact or omitted to state
any material fact required to be stated therein or necessary to make
the statements therein not misleading; or that the Prospectuses, as of
the date of the Prospectuses contained any untrue statement of a
material fact or omitted to state any material fact necessary in order
to make the statements therein, in light of the circumstances under
which they were made not misleading; also, nothing that has come to
such counsel's attention in the course of the procedures described in
the second clause of this paragraph has caused such counsel to believe
that the Prospectuses, as of the Closing Time, contained any untrue
statement of a material fact or omitted to state any material fact
necessary in order to make the statements therein in the light of the
circumstances under which they were made, not misleading; in addition,
such counsel shall state that such counsel does not know of any
litigation or any
A-2-
42
governmental proceeding instituted or threatened against the Company or
Iridium that would be required to be disclosed in the Prospectuses and
is not so disclosed and that such counsel does not know of any
documents that would be required to be filed as exhibits to the
Registration Statement and are not so filed or of any documents that
are required to be summarized in the Prospectuses and are not so
summarized; such counsel shall state that the limitations inherent in
the independent verification of factual matters and the character of
determinations involved in the registration process are such, however,
that such counsel does not assume any responsibility for the accuracy,
completeness or fairness of the statements contained in the
Registration Statement or the Prospectuses except for those made under
the captions "Risk Factors-Risks Associated with Principal Supply
Contracts," "Risk Factors - Risk of Loss of Management Rights Upon
Change of Control," "Risk Factors - Risks Related to the Investment
Company Act of 1940," "Risk Factors - Tax Consequences Related to
Passive Foreign Investment Companies," "Principal Contracts for the
Development of the Iridium System," "Governance of the Company and
Relationship with Iridium," "Description of Iridium LLC Limited
Liability Company Agreement" and "Tax Considerations,", in the
Prospectuses insofar as they relate to provisions of law or documents
therein described; also, such counsel need express no opinion or belief
as to (i) the financial statements or other financial data contained in
the Registration Statement or the Prospectuses (including any financial
projections) and (ii) the description of statutes, regulations,
proceedings or matters referred to in Section 6(d) of the Purchase
Agreement.
In rendering such opinion and letter, such counsel shall state
that they express no opinion as to the laws of any jurisdiction other
than the Federal laws of the United States, the laws of the State of
New York and the Limited Liability Company Act of the State of
Delaware. In rendering such opinion, such counsel may (A) rely as to
matters involving the application of the laws of Bermuda, upon the
opinion of Xxxxxxx Xxxx & Xxxxxxx, Bermuda counsel to the Company
(which opinion shall be dated and furnished to the U.S. Representatives
at Closing Time, shall be satisfactory in form and substance to counsel
for the U.S. Underwriters and shall expressly state that the U.S.
Underwriters may rely on such opinion as if it were addressed to them),
provided that Xxxxxxxx & Xxxxxxxx shall state in their opinion that
they believe that they and the U.S. Underwriters are justified in
relying upon such opinion, and (B) rely as to matters of fact (but not
as to legal conclusions), to the extent they deem proper, on
information obtained from public officials or certificates of
responsible officers of Iridium and the Company and other sources
believed by such counsel to be responsible and (C) assume that the
signatures on all documents examined by such counsel are genuine (which
assumption such counsel need not independently verify).
A-3-
43
Exhibit A-2
FORM OF OPINION OF COMPANY'S BERMUDA
COUNSEL TO BE DELIVERED PURSUANT TO
SECTION 6(c)
1. The Company has been duly incorporated and is validly existing as an
exempted company under the laws of Bermuda and is in good standing (meaning
that it has not failed to make any required filing with any Bermuda
governmental authority or to pay any Bermuda government fee or tax the
failure of which might make it liable to be struck off the Register of
Companies and thereby cease to exist under the laws of Bermuda) under the
laws of Bermuda.
2. The Company has all requisite corporate power and authority necessary to
own or hold its respective properties and conduct its business as described
in the Registration Statement and the Prospectuses.
3. Based solely upon the Certified Register, the minutes, resolutions,
memorandum of association and bye-laws of the Company which we have
examined, the authorized capitalisation of the Company as of [ ] 1997 is
as set forth in the column entitled "Actual" under "Capitalization-the
Company" in the Prospectus and all shares of the Company's issued and
outstanding Common Stock requiring authorization for issuance by the
Company's Board of Directors have been duly authorised and, to such
counsel's knowledge after due inquiry, are validly issued, fully paid and
non-assessable (which term when used herein shall mean no further sums are
required to be paid by the holders thereof in connection with the issue of
such shares) and conform as to legal matters to the description thereof
contained in the Prospectus.
4. The shares of Common Stock to be purchased by the U.S. and the
International Managers from the Company pursuant to the Purchase
Agreements, and the shares of Common Stock issuable upon exercise of
options granted to the U.S. Underwriters and the International Managers to
cover over-allotments, if any, have been duly authorised for issuance and
sale and upon issuance and delivery by the Company in accordance with the
terms of such Purchase Agreement against payment in full of the
consideration set forth in such Purchase Agreements will be duly and
validly issued, fully paid and non-assessable and will not be issued in
violation of the preemptive rights of any shareholders of the Company.
5. The Company has the necessary corporate power and authority to enter into
and perform its obligations under the Documents. The execution and delivery
of the Documents and the performance of the obligations therein set forth
and the consummation of the transactions
A-4-
44
therein contemplated, will not result in a breach or violation of, or
constitute a default under the Memorandum of Association, or Bye-laws or
any of the other Documents, or in violation of any material order, rule,
regulation, writ, injunction, or decree of any government, governmental
instrumentality or court in Bermuda the effect of any which breach,
violation or default would have a material adverse effect on the Company.
6. The Company has taken all corporate action required to authorise its
execution and delivery of the Documents and the performance of its
obligations under the Documents in accordance with their respective terms.
The Documents have been duly and validly authorised and executed by or on
behalf of the Company and each constitutes the legal, valid and binding
obligations of the Company enforceable against it in accordance with its
respective terms and upon delivery will be duly and validly delivered.
7. To the best of our knowledge, no order, consent, approval, licence,
authorisation or validation of or exemption by any government or public
body or authority of Bermuda or any sub-division thereof is required to
authorise or is required in connection with the execution and delivery by
the Company of the Documents, the performance and enforcement of its
obligations thereunder or the conduct of its business as described in the
Prospectus except that permission of the Bermuda Monetary Authority is
required to the issue of the shares of Common Stock and such permission has
been obtained. The issuance and sale of the shares of the Common Stock is
in compliance with all applicable requirements in Bermuda.
8. It is not necessary or advisable, in order to ensure their enforceability
in Bermuda, that the Documents be registered in any register kept by, or
filed with, any governmental authority or regulatory body in Bermuda.
9. The Share Certificates evidencing the shares of Common Stock are in valid
and proper legal form and conform with the requirements of Bermuda law.
10. Based solely on a search of the Cause Book of the Supreme Court of Bermuda
conducted at 10:00 am on [ ], 1997 there are no pending or threatened legal
or governmental proceedings to which the Company is a party which could
materially adversely affect the business, property, financial condition or
operations of the Company, or which question the validly of the shares of
Common Stock, the Documents, or of any action taken or to be taken by the
Company pursuant to the Documents; and no such proceedings are known to us
to be contemplated against the Company.
11. The statements in the Registration Statement under the caption "Risk
Factors-Risk Associated with Incorporation under Bermuda law" and
"Description of Capital Stocks"
A-5-
45
have been reviewed by us and insofar as they refer to descriptions of
agreements, statements of law, descriptions of statutes, licences, rules or
regulations or legal conclusions of Bermuda, are correct in all material
respects.
A-6-
46
Exhibit A-3
FORM OF OPINION OF REGULATORY COUNSEL TO
MOTOROLA SATELLITE COMMUNICATIONS, INC. AS FCC
LICENSE HOLDER TO BE DELIVERED PURSUANT TO
SECTION 6(d)
(i) The information in the Prospectuses under "Risk
Factors--Risks Associated with Licensing and Spectrum Allocation" and
"Regulation of Iridium," accurately summarize in all material respects
the status of all material FCC licenses, permits, approvals and other
FCC authorizations granted to Motorola Satellite Communications, Inc.
with respect to the provision of satellite services via the IRIDIUM
System in the United States as described therein.
(ii) To the best of such counsel's knowledge, Motorola
Satellite Communications, Inc.: (a) is in substantial compliance with
the Communications Act of 1934, as amended, and the rules and
regulations of the FCC promulgated thereunder as they relate to the FCC
licenses, permits, approvals and authorizations referred to in clause
(i) above, and (b) has made all material filings, reports, applications
and submissions required thereunder as they relate to the FCC licenses,
permits, approvals and authorizations referred to in clause (i) above,
except as indicated in the Registration Statement, which filings,
reports, applications and submissions, to the best of such counsel's
knowledge, are true, complete and correct in all material respects.
(iii) No consent, approval, authorization or order of the FCC
is required to be obtained by Motorola Satellite Communications, Inc.
in connection with the authorization, issuance, sale or delivery of the
Securities by Iridium.
(iv) Nothing has come to such counsel's attention that has
caused such counsel to believe that the descriptions relating solely to
the allocation of spectrum in the United States to and the licensing of
the Iridium System in the United States contained under the captions
"Regulation of Iridium" and "Risk Factors--Risks Associated with
Licensing and Spectrum Allocation" of the Registration Statement,
contain any untrue statements of a material fact or omit to state a
material fact necessary to make such descriptions not misleading.
(v) The FCC has authorized Motorola Satellite Communications,
Inc. to construct a mobile satellite system capable of operating in the
1616-1626.5 MHz frequency bands, consistent with the technical
specifications set forth in its application, as modified, the FCC's
rules and the conditions set forth in the FCC's Order and Authorization
(DA 95-131), released January 31, 1995, erratum (DA 95-372, released
February 28, 1995), as affirmed by FCC 96-279, released June 27, 1996;
Order and Authorization (DA 96-1789), released October 30, 1996;
provided, however, that such authorizations are subject to
modification, stay or revocation through appeals or reconsideration
within the FCC or the courts.
A-7-
47
Exhibit A-4
FORM OF OPINION OF ASSISTANT SECRETARY
OF THE COMPANY AND GENERAL COUNSEL OF IRIDIUM
TO BE DELIVERED PURSUANT TO
SECTION 6(e)
(i) Except as described in the Prospectuses, the Company has
not granted any outstanding options, warrants or commitments with
respect to any shares of the capital stock of the Company, whether
issued or unissued; except as described in the Prospectuses, Iridium
has not granted any warrants, rights or options with respect to the
limited liability company interests of Iridium.
(ii) The Governance Agreements have been duly authorized,
executed and delivered by Iridium.
(iii) To the best of my knowledge, Iridium is not in violation
of its Certificate of Formation or Limited Liability Company Agreement
and no default by Iridium exists in the due performance or observance
of any material obligation, agreement, covenant or condition contained
in any contract, indenture, mortgage, loan agreement, note, lease or
other agreement or instrument that is described or referred to in the
Registration Statement or the Prospectuses or filed or incorporated by
reference as an exhibit to the Registration Statement.
(iv) The execution, delivery and performance of the U.S.
Purchase Agreement, the International Purchase Agreement, the 1997
Subscription Agreement and the consummation of the transactions herein
and therein contemplated (including the issuance and sale of the
Securities, and the use of the proceeds from the sale of the Securities
as described in the Prospectuses under the caption "Use Of Proceeds")
do not and will not, whether with or without the giving of notice or
lapse of time or both, conflict with or constitute a breach of, or
default or Repayment Event (as defined in Section 1(a)(x) of the
Purchase Agreements) under any contract, indenture, mortgage, deed of
trust, loan or credit agreement, any other agreement or instrument,
known to such counsel, to which the Company or Iridium is a party or by
which it or any of them may be bound, or to which any of the property
or assets of the Company or Iridium is subject (except for such
conflicts, breaches or defaults or liens, charges or encumbrances that
would not have a Material Adverse Effect).
(v) Except as described in the Registration Statement, there
are no persons with registration rights or other similar rights to have
any securities registered pursuant to the Registration Statement or
otherwise registered by Iridium under the 1933 Act.
(vi) Iridium has duly and validly authorized, executed and
delivered each of the Principal Agreements to which it is a party and,
assuming due authorization, execution and
A-8-
48
delivery by the other parties to the Principal Agreements, each of the
Principal Agreements is a legally valid and binding agreement of the
Company, enforceable against the Company in accordance with its terms,
subject, as to enforcement, to bankruptcy, insolvency, reorganization
and other laws of general applicability relating to or affecting
creditors' rights and to general equity principles or with respect to
any provision of such agreements purporting to require indemnification
of, or contribution to, the losses, damages, claims, expenses or
liability of any person.
(vii) Each of the Company and Iridium has duly and validly
authorized, executed and delivered each of the Governance Agreements
and, assuming due authorization, execution and delivery by the other
parties to the Governance Agreements, each of the Governance Agreements
is a legally valid and binding agreement of the Company and Iridium,
enforceable against the Company and Iridium in accordance with its
terms, subject, as to enforcement, to bankruptcy, insolvency,
reorganization and other laws of general applicability relating to or
affecting creditors' rights and to general equity principles.
(viii) Except as disclosed in the Registration Statement, to
the best of my knowledge, there is not pending or threatened any
action, suit, proceeding, inquiry or investigation, to which the
Company or Iridium is a party, or to which the property of the Company
or Iridium is subject, before or brought by any court or governmental
agency or body, domestic or foreign, which might reasonably be expected
to result in a Material Adverse Effect, or which might reasonably be
expected to materially and adversely affect the properties or assets
thereof or the consummation of the transactions contemplated in the
U.S. Purchase Agreement, the International Purchase Agreement or the
1997 Subscription Agreement or the performance by the Company or
Iridium of their obligations thereunder or the consummation of the
Transactions.
In rendering such opinion, such counsel shall state that such
counsel expresses no opinion as to the laws of any jurisdiction other
than the Federal laws of the United States and the Limited Liability
Company Act of the State of Delaware. In rendering such opinion, such
counsel may rely (A) as to matters involving the application of the
laws of Bermuda, upon the opinion of Xxxxxxx Xxxx & Xxxxxxx, Bermuda
counsel to the Company (which opinion shall be dated and furnished to
the U.S. Representatives at Closing Time, shall be satisfactory in form
and substance to counsel for the U.S. Underwriters and shall expressly
state that the U.S. Underwriters may rely on such opinion as if it were
addressed to them), and (B), as to matters of fact (but not as to legal
conclusions), to the extent he deems proper, on information obtained
from public officials or certificates of responsible officers of
Iridium and the Company and other sources believed by such counsel to
be responsible and (C) assume that the signatures on all documents
examined by such counsel (other than those of officers or directors of
Iridium or the Company) are genuine (which assumption such counsel need
not independently verify).
A-9-
49
Exhibit B
Nothing has come to our attention that would lead us to
believe that the Registration Statement or any amendment thereto,
including the Rule 430A Information and Rule 434 Information (if
applicable), (except for financial statements and schedules and other
financial data included therein or omitted therefrom, as to which we
need make no statement), at the time such Registration Statement or any
such amendment became effective, contained an untrue statement of a
material fact or omitted to state a material fact required to be stated
therein or necessary to make the statements therein not misleading or
that the Prospectuses or any amendment or supplement thereto (except
for financial statements and schedules and other financial data
included therein or omitted therefrom, as to which we need make no
statement), at the time the Prospectuses were issued, at the time any
such amended or supplemented prospectus was issued or at Closing Time,
included or includes an untrue statement of a material fact or omitted
or omits to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they
were made, not misleading.
X-0-
00
Xxxxxxx X
____________ , 1997
XXXXXXX XXXXX & CO.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
Xxxxxxxxx, Lufkin & Xxxxxxxx
Securities Corporation
Xxxxxxx, Sachs & Co.
as U.S. Representatives of the several
U.S. Underwriters to be named in the
within-mentioned U.S. Purchase Agreement
x/x Xxxxxxx Xxxxx & Xx.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated(1)
Xxxxx Xxxxx
Xxxxx Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
XXXXXXX XXXXX INTERNATIONAL
Xxxxxxxxx, Lufkin & Xxxxxxxx
Securities Corporation
Xxxxxxx Sachs International
as Lead Manager(s) of the several International Managers
c/o Merrill Xxxxx International
00 Xxxxxxxxxx Xxxx
Xxxxxx XXXX 0XX
Xxxxxxx
Re: Proposed Public Offering by Iridium World Communications Ltd.
Dear Sirs:
The undersigned, a stockholder of Iridium World Communications Ltd, a
Bermuda company (the "Company"), understands that Xxxxxxx Xxxxx & Co., Xxxxxxx
Lynch, Pierce, Xxxxxx & Xxxxx Incorporated ("Xxxxxxx Xxxxx"), Dondaldson, Lufkin
& Xxxxxxxx Securities Corporation and Xxxxxxx, Sachs & Co. propose to enter into
a U.S. Purchase Agreement (the "U.S. Purchase Agreement") with the Company
providing for the public offering of shares (the "Securities") of the Company's
Class A common stock, par value $.01 per share (the "Class A Common Stock"). In
recognition of the benefit that such an offering will confer upon the
undersigned as a stockholder of the Company, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
undersigned agrees with each underwriter to be named in the U.S. Purchase
Agreement that, during a period of 180 days from the date of the U.S. Purchase
Agreement, the undersigned will not, without the prior written consent of
Xxxxxxx Xxxxx, directly or
D-1-
51
indirectly, (i) offer, pledge, sell, contract to sell, sell any option or
contract to purchase, purchase any option or contract to sell, grant any option,
right or warrant for the sale of, or otherwise dispose of or transfer any shares
of the Company's Class A Common Stock or any securities convertible into or
exchangeable or exercisable for Class A Common Stock, whether now owned or
hereafter acquired by the undersigned or with respect to which the undersigned
has or hereafter acquires the power of disposition, or file any registration
statement under the Securities Act of 1933, as amended, with respect to any of
the foregoing or (ii) enter into any swap or any other agreement or any
transaction that transfers, in whole or in part, directly or indirectly, the
economic consequence of ownership of the Class A Common Stock, whether any such
swap or transaction is to be settled by delivery of Class A Common Stock or
other securities, in cash or otherwise.
Very truly yours,
Signature:________________________
Print Name:_______________________
D-2-
