EXHIBIT 10.27
CONFIDENTIAL SETTLEMENT MATERIAL
CONTRIBUTION AGREEMENT
BY AND AMONG
LIBERTY SATELLITE & TECHNOLOGY, INC.,
LIBERTY MEDIA CORPORATION,
AND
ASTROLINK INTERNATIONAL LLC
DATED AS OF JANUARY 17, 2003
TABLE OF CONTENTS
PAGE
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ARTICLE I DEFINITIONS............................................................................1
Section 1.1 Definitions....................................................................1
Section 1.2 Terms..........................................................................4
ARTICLE II TRANSACTIONS..........................................................................4
Section 2.1 Contribution by the Liberty Transferors........................................4
Section 2.2 Contribution by Astrolink......................................................5
Section 2.3 Value of LSAT Stock............................................................5
Section 2.4 Adjustment.....................................................................6
Section 2.5 Value of the Contributions.....................................................6
Section 2.6 Alternative Transaction........................................................6
ARTICLE III REPRESENTATIONS AND WARRANTIES OF LIBERTY............................................7
Section 3.1 Investment Purpose.............................................................7
Section 3.2 No Liens.......................................................................8
Section 3.3 Ownership Interests in LSAT....................................................8
ARTICLE IV REPRESENTATIONS AND WARRANTIES OF ASTROLINK...........................................8
Section 4.1 Investment Purpose.............................................................8
Section 4.2 Ownership; Capitalization; No Liens............................................9
ARTICLE V REPRESENTATIONS AND WARRANTIES OF LSAT................................................10
Section 5.1 Investment Purpose............................................................10
Section 5.2 Non-Contravention.............................................................10
Section 5.3 Validity of LSAT Shares.......................................................10
Section 5.4 Disclosure....................................................................10
ARTICLE VI COVENANTS............................................................................11
Section 6.1 Treatment of Transactions for Tax Purposes....................................11
Section 6.2 Determination of Liberty Contribution.........................................11
ARTICLE VII CLOSING CONDITIONS..................................................................11
Section 7.1 Conditions to Each Party's Obligation to Effect the Closing...................11
ARTICLE VIII TERMINATION........................................................................12
Section 8.1 Termination on Alternative Transaction........................................12
Section 8.2 Termination upon Termination of Other Agreements..............................12
Section 8.3 Effect of Termination and Abandonment.........................................12
ARTICLE IX MISCELLANEOUS........................................................................12
Section 9.1 Survival of Representations and Warranties....................................12
Section 9.2 Amendments, Waivers, Etc......................................................12
Section 9.3 Third Party Beneficiaries.....................................................13
Section 9.4 Incorporation by Reference....................................................13
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CONTRIBUTION AGREEMENT
CONTRIBUTION AGREEMENT dated as of January 17, 2003, by and among LIBERTY
SATELLITE & TECHNOLOGY, INC., a Delaware corporation ("LSAT"), Liberty Media
Corporation, a Delaware corporation ("Liberty"), and ASTROLINK International
LLC, a Delaware limited liability company ("Astrolink").
RECITALS
A. The Master Agreement Regarding Restructuring of ASTROLINK
International, LLC (the "Master Agreement"), dated as of even date herewith,
provides that LSAT, Liberty, and Astrolink will enter into this Agreement.
B. This Agreement provides for the Liberty Transferors (as defined
below) to contribute certain assets to LSAT in exchange for shares of LSAT's
Series B Common Stock.
C. This Agreement provides for Astrolink to contribute all of its
membership interests in New Astrolink (as defined in the Master Agreement) to
LSAT in exchange for cash and shares of LSAT's Series A Common Stock.
D. The Parties intend that the transactions contemplated by this
Agreement constitute a Section 351 Transaction.
NOW, THEREFORE, in consideration of the mutual representations, warranties,
and agreements contained herein and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the Parties,
intending to be legally bound, agree as follows:
ARTICLE I
DEFINITIONS
Section 1.1 DEFINITIONS. The following words and expressions have
the meanings set forth below:
10% VALUE REQUIREMENT: as defined in Section 2.1(a).
AFFILIATE: with respect to any Person, any other Person directly or
indirectly Controlling, Controlled by or under common Control with such first
Person. Notwithstanding any other provision of this Agreement, none of Liberty
and its Subsidiaries (other than LSAT and its Subsidiaries) shall be treated as
an Affiliate of LSAT or any of its Subsidiaries, and none of LSAT and its
Subsidiaries shall be treated as an Affiliate of Liberty or any of its
Subsidiaries (other than LSAT and its Subsidiaries), for any purpose under this
Agreement.
AGREEMENT: this
contribution agreement, including all exhibits and
schedules hereto.
ALTERNATIVE TRANSACTION NEGOTIATION: as defined in Section 2.6.
ASSIGNMENT AGREEMENT: as defined in Section 2.2(a).
ASTROLINK: as defined in the preamble hereto.
ASTROLINK CONTRIBUTION: as defined in Section 2.2(a).
ASTROLINK LSAT SHARES: as defined in Section 2.2(b).
BUSINESS DAY: any day other than a Saturday, a Sunday, or a day on which
banks in New York, New York are authorized to be closed.
CLOSING: the consummation of the Transactions contemplated by this
Agreement, which Transactions will be consummated on the date when and at the
location where the other transactions under the Master Agreement which are to
close substantially simultaneously with the Transactions are consummated,
provided that, the conditions to the Parties' obligations to effect the
Transactions in Article VII have been satisfied, or to the extent permitted by
applicable Legal Requirements waived by the applicable Party.
CLOSING DATE: the date of the Closing.
CODE: as defined in the Master Agreement.
CONTROL: the power, directly or indirectly, to direct or cause the
direction of the management and policies of a Person, whether by the ownership
of voting securities, by contract, or otherwise.
EXCHANGE ACT: the Securities Exchange Act of 1934, as amended, and the
rules and regulations promulgated thereunder.
GOVERNMENTAL AUTHORITY: as defined in the Master Agreement.
LEGAL REQUIREMENTS: as defined in the Master Agreement.
LIBERTY: as defined in the preamble hereto.
LIBERTY CONTRIBUTION: as defined in Section 2.1(a).
LIBERTY LSAT SHARES: as defined in Section 2.1(b).
LIBERTY TRANSFERORS: the Persons transferring (or on whose behalf Liberty
transfers) the Liberty Contribution to LSAT pursuant to this Agreement, which
will be Liberty and/or one or more Affiliates of Liberty that are members of its
consolidated group for U.S. federal income tax purposes.
LIEN: any security interest, lien, claim, pledge, charge, or other
encumbrance of any nature whatsoever.
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NEW ASTROLINK LLC AGREEMENT: the Limited Liability Company Agreement of New
Astrolink by and between New Astrolink and Astrolink, as such agreement may be
amended, modified, or restated from time to time.
LOCKHEED ▇▇▇▇▇▇: Lockheed ▇▇▇▇▇▇ Corporation, a Maryland corporation.
LSAT: as defined in the preamble hereto.
LSAT SEC REPORTS: as defined in Section 5.4.
LSAT SUBSIDIARY: as defined in Section 2.6(iii).
MASTER AGREEMENT: as defined in the recitals hereto.
NEW ASTROLINK: as defined in the Master Agreement.
PARTIES: LSAT, Liberty, and Astrolink.
PERSON: as defined in the Master Agreement.
QUALIFIED APPRAISER: as defined in Section 2.5(b).
REGISTRATION RIGHTS AGREEMENT: as defined in Section 2.2(b).
RESTRICTIONS: with respect to any capital stock, partnership interest,
membership interest in a limited liability company, or other security, any
voting or other trust or agreement, option, warrant, preemptive right, right of
first offer, right of first refusal, escrow arrangement, proxy, buy-sell
agreement, power of attorney, or other contract, any law, rule, regulation,
order, judgment, or decree which, conditionally or unconditionally, (i) grants
to any Person the right to purchase or otherwise acquire, or obligates any
Person to sell or otherwise dispose of or issue, or otherwise results or,
whether upon the occurrence of any event or with notice or lapse of time or both
or otherwise, would result in any Person acquiring, (A) any of such capital
stock or other security; (B) any of the proceeds of, or any distributions paid
or which are or may become payable with respect to, any of such capital stock or
other security; or (C) any interest in such capital stock or other security or
any such proceeds or distributions; (ii) restricts or, whether upon the
occurrence of any event or with notice or lapse of time or both or otherwise, is
reasonably likely to restrict the transfer or voting of, or the exercise of any
rights or the enjoyment of any benefits arising by reason of ownership of, any
such capital stock or other security or any such proceeds or distributions; or
(iii) creates or, whether upon the occurrence of any event or with notice or
lapse of time or both or otherwise, is reasonably likely to create a Lien or
purported Lien affecting such capital stock or other security, proceeds or
distributions.
SEC: the U.S. Securities and Exchange Commission.
SECTION 351 TRANSACTION: a transaction qualifying for nonrecognition of
gain or loss under Section 351(a) of the Code, except to the extent that gain is
required to be recognized pursuant to Section 351(b) of the Code.
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SECURITIES ACT: the Securities Act of 1933, as amended, and the rules and
regulations promulgated thereunder.
SUBSIDIARY: with respect to any Person, an entity in which such Person,
directly or indirectly through one or more Subsidiaries, owns a majority of (a)
the voting power of the issued and outstanding shares of capital stock or other
ownership interests in such entity entitled to vote generally in the election or
appointment of directors or members of the governing body of such entity or (b)
the ownership interests in such entity. Notwithstanding any other provision of
this Agreement, neither LSAT nor any Subsidiary of LSAT shall be deemed a
Subsidiary of Liberty or any of the Liberty Transferors.
TRANSACTION DOCUMENTS: (i) as of date of this Agreement, and for purposes
of the representations and warranties made on the date of this Agreement, this
Agreement and (ii) thereafter, and for purposes of the representations and
warranties made at the Closing, this Agreement and all documents and instruments
to be executed and delivered in connection with the Transactions, including the
Assignment Agreement and the Registration Rights Agreement.
TRANSACTIONS: the transactions contemplated by this Agreement.
U.S.: the United States of America.
Section 1.2 TERMS. Terms used with initial capital letters will
have the meanings specified, applicable to both singular and plural forms, for
all purposes of this Agreement. All pronouns (and any variation) will be deemed
to refer to the masculine, feminine, or neuter, as the identity of the Person
may require. The singular or plural includes the other, as the context requires
or permits. The word "include" (and any variation) is used in an illustrative
sense rather than a limiting sense. The words "hereof," "herein," "hereunder,"
and comparable terms refer to the entirety of this Agreement and not to any
particular article, section, or other subdivision hereof or attachment hereto.
References to any statute or regulation are to it as amended and supplemented
from time to time, and to any corresponding provisions of successor statutes or
regulations. References to "Article" or "Section" or to a "Schedule" or
"Exhibit" are to an article or section hereof or to a schedule or exhibit
hereto. All references to "the date of this Agreement" or similar terms (but
excluding references to the date of execution hereof) refer to the date first
above written, notwithstanding that the Parties may have executed this Agreement
on a later date. The word day without the qualification "Business" means a
calendar day. If any action or notice is to be taken or given on or by a
particular calendar day, and such calendar day is not a Business Day, then such
action or notice may be taken or given on the next succeeding Business Day.
ARTICLE II
TRANSACTIONS
Section 2.1 CONTRIBUTION BY THE LIBERTY TRANSFERORS. Upon the
terms and subject to the conditions contained in this Agreement:
(a) On the Closing Date, Liberty will cause the Liberty
Transferors to transfer to LSAT (or will make such transfers on behalf of the
Liberty Transferors) cash, property, or notes, or
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any combination thereof (the "Liberty Contribution"), having an aggregate value
which is not less than 10% of the value of the LSAT stock held by the Liberty
Transferors (the "10% Value Requirement"), but in no event will Liberty have an
obligation to transfer or cause to be transferred assets having a value in
excess of $55 million. The proportion of the Liberty Contribution made by, or on
behalf of, each Liberty Transferor will equal the value of such Liberty
Transferor's holdings of LSAT stock divided by the aggregate value of all
Liberty Transferors' holdings of LSAT stock.
(b) In exchange for the Liberty Contribution, LSAT will issue to
each of the Liberty Transferors shares of Series B Common Stock of LSAT
(collectively, the "Liberty LSAT Shares") having a value equal to the value of
such Liberty Transferor's portion of the Liberty Contribution, within five
Business Days following the Closing Date.
Section 2.2 CONTRIBUTION BY ASTROLINK. Upon the terms and subject
to the conditions contained in this Agreement:
(a) On the Closing Date, Astrolink will transfer all of its
membership interests in New Astrolink to LSAT (the "Astrolink Contribution")
pursuant to an assignment and assumption agreement in the form attached as
Exhibit A (the "Assignment Agreement").
(b) In exchange for the Astrolink Contribution, on the Closing
Date, LSAT will (i) pay to Astrolink $25,612,000 in cash by wire transfer of
immediately available funds to an account designated for such purpose by
Astrolink in writing at least two Business Days prior to the Closing and (ii)
issue to Astrolink shares of Series A Common Stock of LSAT having a value equal
to $3,010,000 (the "Astrolink LSAT Shares"). In addition, LSAT will grant
Astrolink certain registration rights in respect of the Astrolink LSAT Shares
pursuant to a registration rights agreement in the form attached as Exhibit B
(the "Registration Rights Agreement").
Section 2.3 VALUE OF LSAT STOCK. For purposes of Sections 2.1,
2.2, and 2.6, the value of LSAT's stock will be determined in the following
manner:
(a) The value of each share of the Series A Common Stock of LSAT
will be the average of the highest and lowest sales prices of the Series A
Common Stock of LSAT on each of the ten consecutive trading days ending the last
trading day at least four Business Days prior to the Closing Date.
(b) The value of each share of the Series B Common Stock of LSAT
will be the average of the highest and lowest sales prices of the Series A
Common Stock of LSAT on each of the ten consecutive trading days ending the last
trading day at least four Business Days prior to the Closing Date.
(c) The value of the Series A Preferred Stock of LSAT will be its
value as of the Closing Date (or as close to the Closing Date as reasonably
practical) as determined by a qualified investment banker to be selected by
LSAT.
(d) The value of the Series B Preferred Stock of LSAT will be its
value as of the Closing Date (or as close to the Closing Date as reasonably
practical) as determined by a qualified investment banker to be selected by
LSAT.
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Section 2.4 ADJUSTMENT. The value of each share of LSAT stock as
calculated in Section 2.3 will be subject to appropriate adjustment (which
adjustment will be made in an equitable manner in order to provide the Parties
with the economic benefits and burdens bargained for hereunder) in the event of
stock splits, stock dividends, combinations, or any recapitalization,
reclassification, or similar transaction involving LSAT, the effective date or
record date of which is during the trading days used to value such stock
pursuant to Section 2.3 or after such trading days and before or on the date of
issuance of such stock. If any spin-off, split-off, or other transaction
involving LSAT occurs, or a record date is established for any such transaction,
and the preceding sentence does not provide a proper equitable adjustment with
respect to such transaction, the value of each share of LSAT stock shall be
adjusted so as to provide the Parties with the consideration bargained for in
this Agreement and to place the Parties in the same position as the Parties
would have been in if such transaction had not occurred (which adjustment will
be made in an equitable manner and in accordance with NASDAQ listing rules, if
applicable, in order to provide the Parties with the economic benefits and
burdens bargained for hereunder).
Section 2.5 VALUE OF THE CONTRIBUTIONS. For purposes of Section
2.1, the value of the Liberty Contribution will be determined in the following
manner:
(a) The value of any cash contributed as part of the Liberty
Contribution will be the amount of such cash.
(b) The value of any other assets contributed as part of the
Liberty Contribution will be the fair market value of such assets, as agreed to
by the Parties, and reasonably acceptable to Lockheed ▇▇▇▇▇▇. If the Parties are
unable to agree on the value of any such assets, or such value is not reasonably
acceptable to Lockheed ▇▇▇▇▇▇, the Parties will retain an independent appraiser
qualified to value such assets (a "Qualified Appraiser") to determine the value
of such assets. If the Parties are unable to agree on a Qualified Appraiser,
each Party will select a Qualified Appraiser, and those three appraisers will
select a fourth appraiser, which will be the Qualified Appraiser to determine
the value of such assets. The value determined by the Qualified Appraiser will
be final and binding on the Parties and Lockheed ▇▇▇▇▇▇.
Section 2.6 ALTERNATIVE TRANSACTION. Notwithstanding Sections 2.1
and 2.2, if the 10% Value Requirement would not be met by a Liberty Contribution
valued at $55 million at the Closing, then the Parties will negotiate in good
faith to reach agreement on pursuing one of the following alternatives (an
"Alternative Transaction Negotiation"):
(i) The Liberty Contribution will be increased to an amount
necessary to satisfy the 10% Value Requirement.
(ii) The Parties will agree on an amount of the Liberty
Contribution reasonably satisfactory to Lockheed ▇▇▇▇▇▇ that is less than the
10% Value Requirement but that will be sufficient for the Transactions to meet
the requirements for a Section 351 Transaction.
(iii) LSAT and Astrolink will enter into, and LSAT will cause a
wholly owned Subsidiary of LSAT (the "LSAT Subsidiary") reasonably acceptable to
Lockheed ▇▇▇▇▇▇ to enter into, an alternative
contribution agreement with terms
and conditions substantially similar to this Agreement but with (A) LSAT and
Astrolink as the transferors and the LSAT Subsidiary as the
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transferee, (B) the LSAT Subsidiary issuing its common or preferred stock (or
some combination thereof) in exchange for the contribution by LSAT, and (C) the
LSAT Subsidiary issuing its preferred stock (which may be voting stock, at the
option of the LSAT Subsidiary in its discretion) in exchange for the
contribution by Astrolink.
Any Party (or Lockheed ▇▇▇▇▇▇) may commence an Alternative
Transaction Negotiation by giving written notice to all other Parties (and
Lockheed ▇▇▇▇▇▇) at any time that is within 30 days prior to the date that such
Party (or Lockheed ▇▇▇▇▇▇) reasonably anticipates will be the Closing Date if
the value of the Series A Common Stock of LSAT as of such date is such that the
10% Value Requirement would not be met by a Liberty Contribution valued at $55
million if such date were the Closing Date.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF LIBERTY
On the date of this Agreement, Liberty represents and warrants to
each of LSAT and Astrolink with respect to itself, and at the Closing, Liberty
represents and warrants to each of LSAT and Astrolink with respect to itself and
each of the Liberty Transferors, as follows:
Section 3.1 INVESTMENT PURPOSE. The Liberty LSAT Shares being
acquired by such Person are for its own account, for investment purposes, and
not with a view to the distribution thereof. Such Person understands that the
Liberty LSAT Shares have not been registered under the Securities Act or
applicable state and other securities laws by reason of a specific exemption
from the registration provisions of the Securities Act and applicable state and
other securities laws, the availability of which depends upon, among other
things, the bona fide nature of the investment intent and accuracy of this
representation. Such Person is an "accredited investor" (as that term is defined
in Rule 501 of Regulation D under the Securities Act) and, by reason of its
business and financial experience, it has such knowledge, sophistication, and
experience in business and financial matters as to be capable of evaluating the
merits and risks of the prospective investment and is able to bear the economic
risk of such investment. Such Person understands that the certificates
representing the Liberty LSAT Shares will contain legends stating in substance:
THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"),
OR UNDER ANY STATE SECURITIES LAW, AND MAY NOT BE SOLD, TRANSFERRED,
ASSIGNED, PLEDGED, HYPOTHECATED, OR OTHERWISE DISPOSED OF EXCEPT
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT AND
PURSUANT TO THE PROVISIONS OF ANY APPLICABLE STATE SECURITIES LAWS
COVERING SUCH SECURITIES OR UNLESS SUCH SALE, TRANSFER, ASSIGNMENT,
OR HYPOTHECATION IS EXEMPT FROM THE REGISTRATION AND PROSPECTUS
DELIVERY REQUIREMENTS OF THE ACT AND THE PROVISIONS OF ANY
APPLICABLE STATE SECURITIES LAWS.
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Such Person understands and acknowledges that LSAT will deliver an
unlegended certificate in exchange for a certificate bearing such legend only in
the event that (i) such Person transfers shares represented by such certificate
pursuant to and in the manner provided for in an effective registration
statement covering the transfer or sale of such shares or (ii) such Person shall
have delivered to LSAT a letter from the staff of the SEC, or an opinion of
counsel in form and substance satisfactory to LSAT, to the effect that such
legend is not required for the purposes of the Securities Act.
Section 3.2 NO LIENS. The assets constituting the Liberty
Contribution will be free of all Liens and Restrictions (other than any Liens or
Restrictions arising out of or pursuant to this Agreement or any other
Transaction Document and any restrictions on transfer arising under the
Securities Act and state securities laws).
Section 3.3 OWNERSHIP INTERESTS IN LSAT. Schedule 3.3 sets forth,
as of the date hereof, the beneficial ownership of the capital stock of LSAT (as
determined for U.S. federal income tax purposes) by each Affiliate of Liberty
that is a member of Liberty's consolidated group for U.S. federal income tax
purposes. As of the date hereof, the Affiliates of Liberty set forth on Schedule
3.3 directly own, in the aggregate, stock of LSAT representing "control" of LSAT
within the meaning of Section 368(c) of the Code. Schedule 3.3, as amended by
Liberty on or prior to the Closing Date, sets forth, as of the Closing Date, the
beneficial ownership of the capital stock of LSAT (as determined for U.S.
federal income tax purposes) by each Liberty Transferor. As of the Closing Date,
the Liberty Transferors directly own, in the aggregate, stock of LSAT
representing "control" of LSAT within the meaning of Section 368(c) of the Code.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF ASTROLINK
On the date of this Agreement and at the Closing, Astrolink
represents and warrants to each of Liberty and LSAT as follows:
Section 4.1 INVESTMENT PURPOSE. The Astrolink LSAT Shares being
acquired by Astrolink are for its own account, for investment purposes, and not
with a view to the distribution thereof. Astrolink understands that the
Astrolink LSAT Shares have not been registered under the Securities Act or
applicable state and other securities laws by reason of a specific exemption
from the registration provisions of the Securities Act and applicable state and
other securities laws, the availability of which depends upon, among other
things, the bona fide nature of the investment intent and accuracy of this
representation. Astrolink is an "accredited investor" (as that term is defined
in Rule 501 of Regulation D under the Securities Act) and, by reason of its
business and financial experience, it has such knowledge, sophistication, and
experience in business and financial matters as to be capable of evaluating the
merits and risks of the prospective investment and is able to bear the economic
risk of such investment.
Astrolink understands that the certificate representing the
Astrolink LSAT Shares will contain legends stating in substance:
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THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"),
OR UNDER ANY STATE SECURITIES LAW, AND MAY NOT BE SOLD, TRANSFERRED,
ASSIGNED, PLEDGED, HYPOTHECATED, OR OTHERWISE DISPOSED OF EXCEPT
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT AND
PURSUANT TO THE PROVISIONS OF ANY APPLICABLE STATE SECURITIES LAWS
COVERING SUCH SECURITIES OR UNLESS SUCH SALE, TRANSFER, ASSIGNMENT,
OR HYPOTHECATION IS EXEMPT FROM THE REGISTRATION AND PROSPECTUS
DELIVERY REQUIREMENTS OF THE ACT AND THE PROVISIONS OF ANY
APPLICABLE STATE SECURITIES LAWS.
THE SALE, TRANSFER, OR OTHER DISPOSITION OF THE SECURITIES
REPRESENTED BY THIS CERTIFICATE IS SUBJECT TO THE TERMS AND
CONDITIONS OF THE REGISTRATION RIGHTS AGREEMENT DATED _____________,
200_, COPIES OF WHICH MAY BE OBTAINED UPON WRITTEN REQUEST TO THE
SECRETARY OF THE CORPORATION.
Astrolink understands and acknowledges that LSAT will deliver an
unlegended certificate in exchange for the certificate bearing such legends only
in the event that a transfer is done in compliance with the terms of this
Agreement and the Registration Rights Agreement that (i) Astrolink transfers
shares represented by such certificate pursuant to and in the manner provided
for in an effective registration statement covering the transfer or sale of such
shares or (ii) Astrolink shall have delivered to LSAT a letter from the staff of
the SEC, or an opinion of counsel in form and substance satisfactory to LSAT, to
the effect that such legends are not required for the purposes of the Securities
Act.
Section 4.2 OWNERSHIP; CAPITALIZATION; NO LIENS. The membership
interests constituting the Astrolink Contribution will be duly authorized,
validly issued, and fully paid, and such membership interests will be owned
beneficially and of record by Astrolink free and clear of any Liens or
Restrictions (other than any Liens or Restrictions arising out of or pursuant to
this Agreement or any other Transaction Document, any restrictions on transfer
arising under the Securities Act and state securities laws, and any Restrictions
arising under the New Astrolink LLC Agreement (a complete and correct copy of
which has been provided to LSAT)). The Astrolink Contribution will constitute
all of the issued and outstanding membership interests of New Astrolink, and no
other membership interests or securities of New Astrolink will be issued,
reserved for issuance, or outstanding. There will be no options or agreements
relating to any issued or unissued membership interests of New Astrolink or
obligating New Astrolink to issue, transfer, grant, or sell any membership
interests of, or other equity interests in, or securities convertible into or
exchangeable for any membership interests of or equity interests in, New
Astrolink. There will be no outstanding contractual obligations of New Astrolink
to repurchase, redeem, or otherwise
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acquire any membership interests of New Astrolink. New Astrolink has been formed
as a wholly owned direct Subsidiary of Astrolink solely for the purpose of
engaging in the transactions contemplated by the Master Agreement, and prior to
the Closing will engage in no other business activities and will conduct its
operations as contemplated by the Master Agreement.
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF LSAT
On the date of this Agreement and at the Closing, LSAT represents
and warrants to each of Liberty and Astrolink as follows:
Section 5.1 INVESTMENT PURPOSE. The membership interests
constituting the Astrolink Contribution are for LSAT's own account, for
investment purposes, and not with a view to the distribution thereof. LSAT
understands that such membership interests have not been registered under the
Securities Act or applicable state and other securities laws by reason of a
specific exemption from the registration provisions of the Securities Act and
applicable state and other securities laws, the availability of which depends
upon, among other things, the bona fide nature of the investment intent and
accuracy of this representation. LSAT is an "accredited investor" (as that term
is defined in Rule 501 of Regulation D under the Securities Act) and, by reason
of its business and financial experience, it has such knowledge, sophistication,
and experience in business and financial matters as to be capable of evaluating
the merits and risks of the prospective investment and is able to bear the
economic risk of such investment.
Section 5.2 NON-CONTRAVENTION. The execution, delivery, and
performance by LSAT of the Transaction Documents to which it is a party, and the
consummation by LSAT of the Transactions to be consummated by it pursuant to
such Transaction Documents, do not, subject to the accuracy of the
representations and warranties in Sections 3.1 and 4.1, violate the requirements
of the Securities Act, the Exchange Act, state blue sky and securities laws, or
any other applicable Legal Requirement.
Section 5.3 VALIDITY OF LSAT SHARES. All of the shares of Series B
Common Stock of LSAT to be issued to the Liberty Transferors as the Liberty LSAT
Shares and all of the shares of Series A Common Stock of LSAT to be issued to
Astrolink as the Astrolink LSAT Shares will be duly authorized and, when issued
in connection with the Transactions, will be validly issued, fully paid and
nonassessable, and free and clear of all Liens or Restrictions (other than Liens
or Restrictions under this Agreement and the Transaction Documents, and except
for any restrictions on transfer arising under the Securities Act or state
securities laws), and such shares have been reserved for issuance on the books
of LSAT.
Section 5.4 DISCLOSURE. LSAT has filed with the SEC, to the extent
required to be filed, all forms, statements, documents, reports or registration
statements required to be filed by it since December 31, 2001 (collectively, the
"LSAT SEC Reports"). The LSAT SEC Reports (i) complied in all material respects
with the requirements of the Securities Act or the Exchange Act, and the rules
and regulations thereunder, as the case may be, and (ii) did not at the time
they were filed (or if amended or superseded by a document filed and publicly
available prior to the date of this Agreement, then on the date of such filing)
contain any untrue statement of a material fact or
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omit to state a material fact required to be stated therein or necessary in
order to make the statements therein, in light of the circumstances under which
they were made, not misleading. The consolidated financial statements (including
any notes thereto) of LSAT and its Subsidiaries included in the LSAT SEC
Reports, at the time filed, fairly presented in all material respects the
consolidated financial position, results of operations, and cash flows of LSAT
and its consolidated Subsidiaries, as at the respective dates thereof and for
the respective periods indicated therein.
ARTICLE VI
COVENANTS
Section 6.1 TREATMENT OF TRANSACTIONS FOR TAX PURPOSES. The
Parties agree to treat the Transactions as a Section 351 Transaction and further
agree not to take any action, including by the filing of any tax returns or
other documents, that would be inconsistent with such treatment.
Section 6.2 DETERMINATION OF LIBERTY CONTRIBUTION. Liberty will
identify the assets that will comprise the Liberty Contribution and the Persons
that will be the Liberty Transferors within a time frame that leaves a
reasonable time prior to the Closing Date reasonably anticipated by Liberty for
the preparation of the Transaction Documents, the removal of any Liens and
Restrictions on the Liberty Contribution, and the acquisition of any material
consents and governmental approvals needed to transfer the Liberty Contribution
to LSAT. Upon such identification, Liberty will promptly provide LSAT,
Astrolink, and Lockheed ▇▇▇▇▇▇ with a description of the assets comprising the
Liberty Contribution, including the Liberty Transferor for each such asset. The
Parties will negotiate in good faith regarding customary representations and
warranties to be made by the Liberty Transferors based on the nature of the
assets being transferred, and such representations and warranties will be
included in the Transaction Documents conveying such assets and/or as an
amendment to this Agreement as the Parties determine is appropriate, and
regarding any other appropriate amendments to this Agreement or any other
Transaction Document based on the nature of such assets.
ARTICLE VII
CLOSING CONDITIONS
Section 7.1 CONDITIONS TO EACH PARTY'S OBLIGATION TO EFFECT THE
CLOSING. The respective obligations of each Party to effect the Closing will be
subject to the satisfaction, or to the extent permitted by applicable Legal
Requirements the waiver, of the following conditions:
(a) The substantially simultaneous closing of each of the other
transactions under the Master Agreement which are to close substantially
simultaneously with the Transactions pursuant to the Master Agreement (but in
the sequence set forth in the Master Agreement).
(b) The representations and warranties of each other Party
contained in this Agreement shall have been true in all material respects upon
and as of the date of this Agreement and, except for representations and
warranties made as of a specific date, shall be true in all material respects on
and as of the Closing with the same force and effect as if then made, provided
however, that if any portion of any representation or warranty is already
qualified by materiality, for purposes
11
of determining whether this Section 7.1(b) has been satisfied with respect to
such portion of such representation or warranty, such portion of such
representation or warranty as so qualified must be true and correct in all
respects; and each other Party shall have performed and complied in all material
respects with all agreements and covenants required by this Agreement to be
performed or complied with by it prior to the Closing. Each Party will deliver a
certificate duly executed by an authorized executive officer dated as of the
Closing Date reasonably satisfactory in form and substance to each other Party,
certifying that the conditions specified in this Section 7.1(b) have been
satisfied by such Party as of the Closing Date.
(c) Each of the Transaction Documents required to be executed and
delivered at or prior to the Closing shall have been executed and delivered by
all parties thereto in accordance with the provisions of Article II.
ARTICLE VIII
TERMINATION
Section 8.1 TERMINATION ON ALTERNATIVE TRANSACTION. This Agreement
will automatically terminate and the Transactions will be abandoned if
Astrolink, LSAT, and a Subsidiary of LSAT enter into an alternative
contribution
agreement pursuant to Section 2.6(iii).
Section 8.2 TERMINATION UPON TERMINATION OF OTHER AGREEMENTS. This
Agreement will automatically terminate and the Transactions will be abandoned if
the Master Agreement is terminated pursuant to Section 7.1 or Section 7.2
thereof.
Section 8.3 EFFECT OF TERMINATION AND ABANDONMENT. In the event of
termination of this Agreement and abandonment of the Transactions pursuant to
this Article VIII, none of the Parties shall have any liability or further
obligation to the other Parties under this Agreement arising hereunder or in
connection with the Transactions contemplated hereby, except that nothing herein
will relieve any Party from liability for any breach of this Agreement.
ARTICLE IX
MISCELLANEOUS
Section 9.1 SURVIVAL OF REPRESENTATIONS AND WARRANTIES. The
respective representations, warranties, covenants, and agreements of the Parties
contained in this Agreement will survive execution and delivery of this
Agreement notwithstanding any investigation made or information obtained by the
other Parties, and will also survive the Closing and the LMII Contribution
Closing (as defined in the Master Agreement), and will remain in full force and
effect without time limit.
Section 9.2 AMENDMENTS, WAIVERS, ETC. This Agreement may be
amended, changed, supplemented, waived, or otherwise modified only by an
instrument in writing signed by the Party against whom enforcement is sought. In
addition, the provisions of Articles II and of this 9.2 (and the definitions as
they relate to such article and section contained in Article I) may not be
12
amended or waived without the prior written consent of Lockheed ▇▇▇▇▇▇, which
consent shall not be unreasonably withheld, delayed, or conditioned.
Section 9.3 THIRD PARTY BENEFICIARIES. Neither this Agreement nor
any other Transaction Document is intended to be for the benefit of, or will be
enforceable by, any Person who is not a Party except the provisions of Article
II and of Section 9.2 are intended to be for the benefit of, and will be
enforceable by, Lockheed ▇▇▇▇▇▇.
Section 9.4 INCORPORATION BY REFERENCE. The provisions of sections
1.2, 1.3, 9.1, 9.2, 9.4, 9.5, 9.6, 9.7, 9.8, 9.10, 9.11, 9.12, 9.13, 9.14, 9.15,
9.16, 9.17, 9.18, 9.19 and 9.20 of the Master Agreement are hereby incorporated
into this Agreement by reference. In addition, this Agreement is subject to the
terms and conditions of the Master Agreement.
(SIGNATURE PAGE FOLLOWS)
13
IN WITNESS WHEREOF, the undersigned hereto have caused this
Agreement to be duly executed and delivered as of the date first above written.
LIBERTY SATELLITE & TECHNOLOGY, INC.
By:
---------------------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Acting President and Chief Financial Officer
LIBERTY MEDIA CORPORATION
By:
---------------------------------------------
Name:
Title:
ASTROLINK INTERNATIONAL LLC
By:
---------------------------------------------
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Vice President and Chief Financial Officer
(Signature page to the LSAT
Contribution Agreement)
SCHEDULE 3.3
SHARES OWNED BY
SHARES OWNED BY LIBERTY LSAT II, SHARES OWNED BY SHARES OWNED BY
CAPITAL STOCK OF LSAT LIBERTY LSAT, INC. INC. LIBERTY TSAT, INC. LIBERTY AEG, INC.
--------------------- ------------------ ---------------- ------------------ -----------------
Series A 0 150,000 0 0
Preferred Stock
Series B 150,000 0 0 0
Preferred Stock
Series A 1,876,336 2,814,504 179,049 0
Common Stock
Series B 0 0 0 8,701,621
Common Stock
SHARES OWNED BY
SHARES OWNED BY SHARES OWNED BY SHARES OWNED BY LIBERTY
LMC/LSAT HOLDINGS, LIBERTY BRAZIL DTH LIBERTY MEXICO DTH MULTICOUNTRY DTH,
CAPITAL STOCK OF LSAT INC. INC. INC. INC.
--------------------- ------------------ ------------------ ------------------- ------------------
Series A 0 0 0 0
Preferred Stock
Series B 0 0 0 0
Preferred Stock
Series A 0 0 0 0
Common Stock
Series B 17,426,766 3,117,159 3,927,935 787,161
Common Stock
SHARES OWNED BY
LIBERTY SHARES OWNED BY SHARES OWNED BY
INTERNATIONAL DTH, LIBERTY LATIN LIBERTY TP
CAPITAL STOCK OF LSAT INC. PARTNERS, INC. MANAGEMENT, INC.
--------------------- ------------------ --------------- ----------------
Series A 0 0 0
Preferred Stock
Series B 0 0 0
Preferred Stock
Series A 0 0 53,983
Common Stock
Series B 31,486 7,872 332,265
Common Stock
(Schedule to the LSAT
Contribution Agreement)