FIRST AMENDMENT
DATED AS OF DECEMBER 1, 1997
TO PLEDGE AGREEMENT
DATED AS OF JULY 6,1995
BETWEEN
GEOTEK COMMUNICATIONS, INC.
AND
IBJ XXXXXXXX BANK & TRUST COMPANY, AS COLLATERAL AGENT
FIRST AMENDMENT, dated as of December 1, 1997, between GEOTEK
COMMUNICATIONS, INC., a Delaware corporation ("Geotek" or the "Pledgor"), and
IBJ XXXXXXXX BANK & TRUST COMPANY, a banking company organized under the laws of
the State of New York, as collateral agent (the "Collateral Agent").
BACKGROUND:
The parties hereto entered into a Pledge Agreement as of July 6, 1995
(as amended to date, the "Pledge Agreement"), in connection with the Indenture,
dated as of June 30, 1995, between the parties hereto, which governs Geotek's
15% Senior Secured Discount Notes due 2005 (the "Securities"). Geotek and
holders of a majority of the outstanding aggregate principal amount of
Securities have agreed to amend certain provisions of the Pledge Agreement as
set forth herein.
Accordingly, the parties hereto agree as follows:
AGREEMENT:
1. Definitions. Capitalized terms used herein and not
otherwise defined shall have the meanings ascribed to such terms in the Pledge
Agreement.
2. Additional Pledged Securities. Schedule I to the Pledge
Agreement is hereby amended and restated as set forth in Schedule I to this
Agreement. Geotek shall deliver to the Collateral Agent the share certificates
evidencing all of the Capital Stock of Geotek U.S. Networks, Inc., duly endorsed
in blank or accompanied by proper instruments of assignment or transfer
(including without limitation undated stock powers executed in blank with
signatures appropriately guaranteed).
3. Amended Recital. The first Recital on page 1 of the Pledge
Agreement is hereby amended and restated in its entirety to read as follows:
A. Geotek and the Collateral Agent are parties to an
Indenture dated as of June 30, 1995
(as the same may be amended, modified, extended or replaced
from time to time, the "Indenture").
4. New Definitions. Section 1.2 of the Pledge Agreement is
hereby amended to add the following new definitions in alphabetical order among
the existing definitions (and to delete the letters in parentheses preceding the
existing definitions):
"License Holding Company" means [Geotek U.S.
Networks, Inc.], a Delaware corporation which is a
Wholly-Owned Subsidiary of Geotek and is one of the Pledged
Companies.
"License Reallocation" means the transfer of the
Reallocated Licenses by Geotek or the Subsidiaries of Geotek
which own such Licenses to the License Holding Company.
"License Restriction" has the meaning set forth in
Section 4.1.15.
"Northeast Licensed Area" means the geographic area
covered by the Northeast Licenses.
"Northeast Licenses" means the Licenses listed in
Schedule V hereto and any other License constituting Northeast
Replacement Collateral.
"Permitted License Transfer" means the transfer of
any Releasable License by the License Holding Company to
Geotek or another Subsidiary of Geotek, provided that each of
the applicable Release Conditions have been satisfied.
"Reallocated Licenses" means the Licenses listed in
Schedule II hereto.
"Releasable Licenses" means the Licenses listed in
Schedules III-(i) and III-(ii) hereto.
"Release Condition Senior Lien" means a lien senior
to the third priority lien or second priority lien granted to
the Collateral Agent under the Release Condition set forth in
clause (i)(B)(2) or (ii)(C), respectively, of the definition
thereof; provided, however, that such senior lien shall not
cover any Collateral other than the Capital Stock or
Releasable License specified in such clauses of the definition
of Release Condition.
"Release Conditions" means (i) with respect to a
Permitted License Transfer of any of the Releasable Licenses
listed in Schedule III-(i) hereto, (A) as of the date of such
Transfer,
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Geotek and its Subsidiaries that are organized under
the laws of any state of the United States or the District of
Columbia and do business in the United States (the "Domestic
Geotek Subsidiaries") shall have not less than 100,000
Qualified GEONET Subscribers in the aggregate, or (B)(1) as of
the date of such Transfer, Geotek and the Domestic Geotek
Subsidiaries shall have not less than 50,000 Qualified GEONET
Subscribers in the aggregate and (2) Geotek shall have caused
Geotek Financing Corporation to enter into a Pledge Agreement
granting to the Collateral Agent for the benefit of the
holders of the Securities a third priority lien on the Capital
Stock of Geotek License Holdings, Inc., which is pledged to
Xxxxxx Network Systems, Inc. ("HNS"), subject only to the
existing liens in favor of HNS under the Amended and Restated
Borrower Pledge Agreement dated September 27, 1996, between
Geotek Financing Corporation and HNS, and shall have provided
to the Collateral Agent an opinion of independent counsel
regarding the perfection and priority of such lien, which
opinion shall be in form and substance reasonably satisfactory
to the Collateral Agent; provided, however, that the Release
Conditions under this clause (i)(B) shall only be effective if
the Licenses listed on Schedule IV hereto are then owned by
Geotek License Holdings, Inc.; and (ii) with respect to a
Permitted License Transfer of any of the Releasable Licenses
listed in Schedule III-(ii) hereto, (A) as of the date of such
Transfer, Geotek and the Domestic Geotek Subsidiaries shall
have not less than 30,000 Qualified GEONET Subscribers in the
aggregate, (B) following such Transfer, such Releasable
Licenses will be utilized to secure (whether by a pledge of
the Capital Stock of the holder of such Releasable Licenses or
a pledge of such Releasable Licenses) Indebtedness permitted
to be incurred under the Indenture, and (C) Geotek shall have
entered into a Pledge Agreement or Security Agreement granting
to the Collateral Agent for the benefit of the holders of the
Securities a second priority lien on the Capital Stock of the
holder of such Releasable Licenses or on such Releasable
Licenses, as the case may be, subject only to the pledge
referred to in clause (ii)(B) above, and shall have provided
to the Collateral Agent an opinion of independent counsel
regarding the perfection and priority of such lien, which
opinion shall be in form and substance reasonably satisfactory
to the Collateral Agent; and (iii) with respect to a Permitted
License Transfer of
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any Releasable License, no Default or Event of Default
shall have occurred and is continuing.
5. Amended Definitions.
(a) Clause (i) of the definition of "Permitted
Pledge Agreement Indebtedness" in Section 1.2 of the Pledge Agreement is hereby
amended and restated in its entirety to read as follows:
(i) Indebtedness permitted to be incurred pursuant to
clauses (b), (c), (e), (f), (g), (h) and (p) of the second
paragraph of Section 4.08 of the Indenture entitled
"Limitation on Indebtedness";
(b) The definition of "Permitted Pledge Agreement
Liens" in Section 1.2 of the Pledge Agreement is hereby amended to add, after
clause (iv) thereof, "and (v) Release Condition Senior Liens."
(c) The definition of "Pledged Companies" in Section
1.2 of the Pledge Agreement is hereby amended to add, after clause (f) thereof,
"and (g) Geotek U.S. Networks, Inc."
(d) The definition of "Qualified GEONET Subscriber"
in Section 1.2 of the Pledge Agreement is hereby amended and restated in its
entirety to read as follows:
"Qualified GEONET Subscriber" means a user of GEONET
services who has generated at least $28.00 in monthly xxxxxxxx
for the two most recently completed consecutive billing months
and who has paid at least one of such monthly xxxxxxxx.
6. Permitted Prior Liens. Section 3.3 of the Pledge Agreement
is hereby amended to add, at the end of such Section, "or the Release Condition
Senior Liens."
7. No Pari Passu Liens. Section 4.1.2 of the Pledge Agreement
is hereby amended to delete the last sentence thereof.
8. Additional Subsidiary Pledges. Sections 4.1.10(a) and (b)
of the Pledge Agreement are hereby amended and restated in their entirety to
read as follows:
(a) The sale, transfer or other disposition of any
Pledged Collateral or any property or assets of any Pledged
Company shall be subject to Section 4.1.12, 4.1.13 and 4.1.14
of this Agreement and Sections 4.12 and 10.08 of the
Indenture.
(b) [Intentionally deleted]
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9. Covenants. The Pledge Agreement is hereby amended to add
the following Sections after Section 4.1.10:
4.1.11 License Reallocation. Geotek and its
Subsidiaries will promptly and diligently take the steps
necessary to carry out the License Reallocation, and shall
complete the License Reallocation on or before April 30, 1998.
Upon the completion of the License Reallocation, Geotek will
deliver to the Collateral Agent an Officers' Certificate and
an opinion of independent counsel to Geotek to the effect that
(a) the Reallocated Licenses are valid and in full force and
effect for their specified terms, (b) there are no pending or
(to the best of such counsel's knowledge) threatened
proceedings before the FCC relating to the Pledged Companies
or any of the Reallocated Licenses, (c) the License Holding
Company owns the Reallocated Licenses free and clear of any
encumbrances or restrictions, except those listed on Schedule
II hereto, (d) the License Reallocation has been approved by a
final order of the FCC, and no other order, approval,
authorization or consent of, or filing or registration with,
any other person (as defined in the Indenture) is necessary or
required in connection with the License Reallocation, and (e)
the Collateral Agent has a first priority perfected security
interest, for the benefit of the holders of the Securities, in
all of the issued and outstanding capital stock of the License
Holding Company and Geotek USA.
4.1.12 Prohibitions Pending License Reallocation.
Unless and until Geotek has completed the License Reallocation
and the Trustee has received the Officers' Certificate and
opinion of counsel referred to in Section 4.1.11 hereof,
Geotek will not, and will not permit any of its Subsidiaries
to, (i) use any Net Cash Proceeds from any Asset Sale for the
working capital needs and general corporate purposes of Geotek
or any of its Subsidiaries, except for the use of the Bogen
Sale Proceeds to the extent permitted by Section 4.20 of the
Indenture, or (ii) make a Permitted License Transfer.
4.1.13 No Sales or Encumbrances. Notwithstanding any
provision to the contrary contained in this Agreement
(including without limitation Sections 4.1.10 and 7.14) or in
the Indenture or any other document, Geotek will not (a) sell,
transfer or otherwise dispose of, or grant any rights or
interest in, any Capital Stock of the License Holding Company
or Geotek USA or
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permit either of such Pledged Companies to issue or have
outstanding any Capital Stock other than Pledged Securities,
or (b) create, incur, permit to exist, pledge or grant a
security interest in or lien (including without limitation
Permitted Pledge Agreement Liens) on any of the Capital Stock
of the License Holding Company or Geotek USA, except in favor
of the Collateral Agent.
4.1.14 Restrictions on License Holding Company.
Notwithstanding any provision to the contrary contained in
this Agreement (including without limitation Sections 4.1.10
and 7.14) or in the Indenture or any other document, Geotek
will not permit the License Holding Company to (a) create,
incur, issue, assume, Guarantee or in any manner become
directly or indirectly liable (contingently or otherwise) for
any Indebtedness (including without limitation Permitted
Pledge Agreement Indebtedness), other than guarantees with
respect to the Securities, (b) own or acquire any material
assets or properties other than the Reallocated Licenses or
other Licenses used in connection with the GEONET systems, (c)
create, incur, permit to exist, pledge or grant a security
interest in or lien (including without limitation Permitted
Pledge Agreement Liens) on any of the Reallocated Licenses,
except for a Release Condition Senior Lien on a Releasable
License following a Permitted License Transfer thereof, (d)
transact any business or engage in any activities other than
holding the Reallocated Licenses and activities that are
necessary or incidental thereto, or (e) sell, convey,
transfer, lease or otherwise dispose of, or grant any rights
or interest in, any Northeast License, except as permitted by
Section 10.08(e)(ii) of the Indenture.
4.1.15 License Restrictions. In the event that Geotek
at any time becomes aware of any encumbrance or restriction
(operational or otherwise) imposed on any Reallocated License
by any 900 MHz Designated Frequency Area Specialized Mobile
Radio License held by any person (a "License Restriction"),
other than the License Restrictions described on Schedule II
attached hereto, Geotek shall use all commercially reasonable
best efforts to cause the removal of such License Restriction
as soon as practicable after its discovery thereof. If,
despite such commercially reasonable best efforts, Geotek is
unable to cause the removal of any such License Restriction,
Geotek shall take all actions necessary to provide the
Collateral Agent with
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additional tangible or intangible assets having a Fair Market
Value equivalent to the diminution of the Fair Market Value
of the restricted Licenses caused by such License Restriction.
10. Release of Collateral. The penultimate paragraph of
Section 7.14 of the Pledge Agreement is hereby amended and restated in its
entirety to read as follows, and the last paragraph of Section 7.14 of the
Pledge Agreement is deleted:
In addition, in the event that any Pledged Collateral
is sold or transferred in a transaction permitted by this
Agreement and the Indenture, the Collateral Agent shall
release the Liens in favor of the Collateral Agent in the
Pledged Collateral so sold or transferred on the terms and
conditions set forth in Section 10.08 of the Indenture.
11. Conditions Precedent. The amendment of the Pledge
Agreement pursuant to this First Amendment shall not be effective unless and
until the First Amendment to the Indenture has been executed and delivered by
Geotek and the Trustee and each of the conditions precedent to the effectiveness
thereof have been satisfied.
12. Counterparts. This First Amendment may be signed in any
number of counterpart copies, each of which shall constitute an original, with
the same effect as if the signatures thereon and hereon were upon the same
instrument.
13. Governing Law. This First Amendment shall be construed, interpreted
and governed by the laws of the State of New York, without giving effect to the
principles of conflicts of law.
14. No Other Amendments. Except as to the matters referred to
in this First Amendment, the Pledge Agreement shall remain in full force and
effect in accordance with its terms.
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IN WITNESS WHEREOF, the Pledgor and the Collateral Agent have executed
this First Amendment as of the date first written above.
GEOTEK COMMUNICATIONS, INC.
By: /s/
---------------------------
Name:
Title:
IBJ XXXXXXXX BANK & TRUST COMPANY,
as collateral agent
By:/s/
---------------------------
Name: Xxxxxxx X. Xxxxxxxxx
Title: Assistant Vice President
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