Preferred Stock Investment Agreement [Amendment No. 1] - CD Radio Inc.
FIRST AMENDMENT
TO PREFERRED STOCK INVESTMENT AGREEMENT
This FIRST AMENDMENT TO PREFERRED STOCK INVESTMENT
AGREEMENT (this "AMENDMENT") is dated as of March 7, 1997, and entered into by
and among CD Radio Inc., a Delaware corporation ("CDRD") and the undersigned
investors and any additional investor that signs a counterpart to this
Agreement (collectively, "INVESTORS"). Capitalized terms used herein without
definition shall have the same meanings herein as set forth in the Preferred
Stock Investment Agreement dated as of October 23, 1996, by and between CDRD
and Investors ("PREFERRED STOCK INVESTMENT AGREEMENT").
RECITALS
WHEREAS, CDRD and Investors desire to amend the Preferred
Stock Investment Agreement as set forth below;
NOW, THEREFORE, in consideration of the premises and the
agreements, provisions and covenants herein contained, the parties hereto agree
as follows:
SECTION 1. AMENDMENTS TO THE PREFERRED STOCK INVESTMENT
AGREEMENT
1.1 AMENDMENT OF RECITALS: The Recitals to the Preferred
Stock Investment Agreement shall be amended by deleting the first two Recitals
and replacing such Recitals with two new Recitals as follows:
"WHEREAS, CDRD desires to issue and sell to the
Investors, and the Investors desire to purchase from CDRD,
up to an aggregate of 8,000,000 shares of CDRD's 5%
Delayed Convertible Preferred Stock having the rights,
designations and preferences set forth in the Certificate
of Designations of CDRD (the "CERTIFICATE OF
DESIGNATIONS") in identical form and substance of Exhibit
I attached to this Agreement (the "PREFERRED SHARES"), on
the terms and conditions set forth in this Agreement;
"WHEREAS, CDRD initially desires to sell to the
Investors up to 4,000,000 of the Preferred Shares ("FIRST
CLOSING SHARES") in the event that it, or its subsidiary,
receives notice from the Federal Communications Commission
("FCC"), with respect to the authority to provide
satellite digital audio radio services ("SATELLITE DARS
LICENSE"), that it is the winning bidder for a Satellite
DARS License at the conclusion of an auction for Satellite
DARS Licenses (a "WINNING BID"), all on the terms and
conditions set forth in this Agreement."
1.2 AMENDMENT OF SECTION 6.2: AUTOMATIC TERMINATION.
Section 6.2 of the Preferred Stock Investment Agreement is hereby amended by
deleting such Section in its entirety and substituting the following therefor:
"Section 6.2 Automatic Termination. This
Agreement shall terminate without further action of the
parties if the First Closing has not occurred prior to (i)
May 1, 1997 if CDRD has not submitted the Winning Bid by
such date or (ii) May 12, 1997 if CDRD has submitted the
Winning Bid prior to May 1, 1997."
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1.3 AMENDMENT OF SECTION 7.3: ENTIRE AGREEMENT; AMENDMENT;
ADDITIONAL INVESTORS; INCREASED COMMITMENTS. Section 7.3 of the Preferred Stock
Investment Agreement is hereby amended (i) by adding the subsection reference
"(a)" before the first sentence of such Section, (ii) by deleting the third
sentence thereof and (iii) by adding the following as subsection (b) as
follows:
"(b) (i) Any Investor may increase its investment
under this Agreement at any time on or prior to
the First Closing Date to purchase such number
of First Closing Shares and Second Closing
Shares as shall be agreed between such Investor
and CDRD in writing. Upon execution of a written
agreement regarding such commitment by such
Investor and CDRD, such Investor shall be
obligated to purchase and CDRD shall be
obligated to sell the additional First Closing
Shares and Second Closing Shares set forth in
such commitment pursuant to the terms of this
Agreement;
(ii) Any individual or other legal entity may
become an additional investor under this
Agreement at any time on or prior to the First
Closing Date with respect to such number of
First Closing Shares and Second Closing Shares
as shall be agreed between such Investor and
CDRD. Any additional investor under this
Agreement may become an additional investor by
executing and delivering a counterpart to the
First Amendment to Preferred Stock Investment
Agreement, dated as of March 7, 1997. Upon
delivery of any such counterpart and acceptance
thereof by CDRD, such counterpart shall be
attached to this Amendment, such additional
investor shall be an Investor (such term as used
in this Agreement to include such additional
Investor) and such additional investor shall be
as fully a party to this Agreement as if such
additional investor were an original signatory
of this Agreement. No consent of any other
Investor shall be required for such addition;
in each case, Schedule I to this Agreement and Exhibits A,
B, C and D to Schedule A to Exhibit 2 to this Agreement,
each automatically shall be revised to reflect the new
allocation of First Closing Shares and Second Closing
Shares to such Investor pursuant to clause (b)(i) above or
the joining of such additional investors to this Agreement
pursuant to clause (b)(ii) above, as the case may be."
1.4 AMENDMENT OF EXHIBIT 1: CERTIFICATE OF DESIGNATIONS OF
5% DELAYED CONVERTIBLE PREFERRED STOCK. Exhibit 1 to the Preferred Stock
Investment Agreement is hereby amended by deleting the initial paragraph
thereof and substituting the following paragraph in its place:
"RESOLVED that there shall be a series of shares of the
Preferred Stock of CD Radio Inc. (the "CORPORATION"),
designated "5% Delayed Convertible Preferred Stock"; that
the number of shares of such series shall be 8,000,000 and
that the rights and preferences of such series (the "5%
PREFERRED") and the limitation or restrictions thereon,
shall be as follows:"
1.5 AMENDMENT OF SCHEDULE A TO EXHIBIT 2: PREFERRED
CUSTODY SERVICES ESCROW AGREEMENT. Schedule A to Exhibit 2 to the Preferred
Stock Investment Agreement is hereby amended by deleting the references to
"March 31, 1997" and to "April 10, 1997" in Sections 3(b)(iii) and 4(b)(i)
thereof and substituting for each such reference "May 1, 1997" and "May 12,
1997", respectively.
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SECTION 2. MISCELLANEOUS
2.1 REFERENCE TO AND EFFECT ON THE PREFERRED STOCK
INVESTMENT AGREEMENT.
(i) On and after the Effective Date, each
reference in the Preferred Stock Investment Agreement to
"this Agreement", "hereunder", "hereof", "herein", or
words of like import referring to the Preferred Stock
Investment Agreement and each reference in the Preferred
Stock Investment Agreement and other related agreements to
the "Investment Agreement", "thereunder" "thereof" or
words of like import referring to the Preferred Stock
Investment Agreement shall mean and be a reference to the
Preferred Stock Investment Agreement, as amended by this
Amendment.
(ii) Except as specifically amended by this
Amendment, the Preferred Stock Investment Agreement shall
remain in full force and effect and is hereby ratified and
confirmed.
2.2 COUNTERPARTS; EFFECTIVENESS. This Amendment may
be executed in any number of counterparts and by different parties hereto in
separate counterparts, each of which when so executed and delivered shall be
deemed an original, but all such counterparts together shall constitute but one
and the same instrument; signature pages may be detached from multiple separate
counterparts and attached to a single counterpart so that all signature pages
are physically attached to the same document. This Amendment shall become
effective as to each party that executes a counterpart of this Amendment on the
date of such execution (the "EFFECTIVE DATE"). Any party who does not execute a
counterpart to this Amendment shall not be bound by the terms of the Agreement.
[Remainder of page intentionally left blank]
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IN WITNESS WHEREOF, the parties hereto have caused this
Amendment to be duly executed and delivered by their respective officers
thereunto duly authorized as of the date first written above.
CD RADIO INC.
By:
---------------------------
Name:
Title:
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<TABLE>
<CAPTION>
INVESTORS:
<S> <C>
Dated: March , 1997 THE VALUE REALIZATION FUND, L.P.
--- By: Canpartners Investments III, L.P.
By: Canyon Capital Management, L.P.
By: Canpartners Incorporated
By:
-------------------------------
its
Dated: March , 1997 GRS Partners II
---
By:
-----------------------------------
its Account Manager
Dated: March , 1997 The Canyon Value Realization Fund,
--- (Cayman) Ltd.
By:
-----------------------------------
its Account Manager
Dated: March , 1997 Cerberus Partners, L.P.
---
By:
-----------------------------------
General Partner Cerberus
Associates, L.P.
General Partner Cerberus
Partners, L.P.
Dated: March , 1997 Cerberus International, Ltd.
---
By:
----------------------------------
Managing Member,
Partridge Hill, L.L.C.
Investment Advisor to
Cerberus International
Dated: March , 1997 The Copernicus Fund, LP
--- By: DDJ Copernicus, LLC
By:
----------------------------
its Member
</TABLE>
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<TABLE>
<S> <C>
Dated: March , 1997 The Galileo Fund, LP
--- By: DDJ Galileo, LLC
By:
----------------------------
its Member
Dated: March , 1997 Dickstein International Limited
--- By: Dickstein Partners, Inc.
By:
----------------------------
its
Dated: March , 1997 Global Bermuda Limited Partnership
--- By: Global Capital Management, Inc.
By:
----------------------------
its Authorized Signatory
Dated: March , 1997 Lakeshore International, Limited
--- By: Global Capital Management, Inc.
By:
----------------------------
its Authorized Signatory
Dated: March , 1997 Elliott Associates, L.P.
---
By:
-----------------------------------
its General Partner
Dated: March , 1997 Westgate International, L.P.
--- By: Martley International, Inc. as
Attorney-in-fact
By:
----------------------------
its
Dated: March , 1997 Everest Capital International, Ltd.
---
</TABLE>
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<TABLE>
<S> <C>
By: Everest Capital, Ltd., Investment
Manager
By:
------------------------------
its
Dated: March , 1997 Everest Capital Fund, L.P.
--- By: Everest Capital, Ltd.,
General Partner
By:
--------------------------------
its
Dated: March , 1997 The Jay Goldman Master Limited Partnership
---
By:
--------------------------------
its General Partner
Dated: March , 1997 Grace Brothers, Ltd.
---
By:
--------------------------------
its General Partner
Dated: March , 1997 Mainstay VP Series Fund, Inc., on behalf
--- of its High Yield Corporate Bond Portfolio
By: Mackay-Shields Financial Corporation
its Investment Advisor
By:
--------------------------------
name:
its:
Dated: March , 1997 The Mainstay Funds, on behalf of its High Yield
--- Corporate Bond Fund series
By: Mackay-Shields Financial Corporation
its Investment Advisor
By:
--------------------------------
name:
its:
</TABLE>
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<TABLE>
<S> <C>
Dated: March , 1997 The Ravich Revocable Trust of 1989
---
By:
------------------------------------
its Trustee
Dated: March , 1997 Scoggin Capital Management
---
By:
-----------------------------------
its General Partner
By:
-----------------------------------
its
By:
-----------------------------------
its
Dated: March , 1997 Scoggin International Fund, Ltd.
---
By:
-----------------------------------
its General Partner
Dated: March , 1997 TCW Shared Opportunity Fund II
--- By: TCW Investment Management Company,
its Investment Adviser
By:
------------------------------
its
By:
------------------------------
its
Dated: March , 1997 LibertyView Plus Fund
---
By:
-----------------------------------
its
</TABLE>
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<TABLE>
<S> <C>
Dated: March , 1997 LibertyView LLC FUND
--- By: Liberty View Capital Management, Inc.
By:
------------------------------
its
Dated: March , 1997 Paresco, Inc.
---
By:
-----------------------------------
its
Dated: March , 1997 Navesink Investment Fund, LDC
---
By:
-----------------------------------
its
Dated: March , 1997 Stonehill Offshore Partners Limited
--- By: Stonehill Advisors LLC, as Agent
By:
-----------------------------------
its:
Dated: March , 1997 Stonehill Investment Corp., for an on behalf of
--- Stonehill Partners, L.P., GRS Partners III and Aurora
Limited Partnership
By:
-----------------------------------
its:
Dated: March , 1997 Herta and Paul Amir Development Family Trust
---
By:
-----------------------------------
its Trustee
Dated: March , 1997 The Wolens Family Trust
---
By:
-----------------------------------
its Trustee
</TABLE>
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<TABLE>
<S> <C>
Dated: March , 1997 LongView Partners
----
By:
-----------------------------------
its General Partner
By:
-----------------------------------
its General Partner
Dated: March , 1997 Cumberland Partners
---
By:
-----------------------------------
its General Partner
By:
-----------------------------------
its
Dated: March , 1997 JMG Capital Partners, L.P.
--- By: JMG Capital Management, Inc.
By:
-----------------------------------
its General Partner
</TABLE>
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<TABLE>
<S> <C>
Dated: March , 1997 Dickstein & Co., L.P.
--- By: Dickstein Partners, L.P.
By: Dickstein Partners, Inc.
By:
----------------------------
its
</TABLE>
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<TABLE>
<S> <C>
ADDITIONAL INVESTORS:
Dated: , 1997 [ADDITIONAL INVESTOR NAME]
-----------------
By
-------------------------
Its
Investor's address:
For purposes of Section 3.6 of this Agreement, the
following percentage limitation shall be applicable:
[ ] 4.99% [ ] 9.99% [ ] no limitation
If no box is marked, no limitation shall be applicable.
CD RADIO INC.
By:
----------------------------------------------
David Margolese,
Chairman and Chief Executive Officer
----------------------------------------------
Aggregate Number of Shares of Preferred Stock
Agreed to be Issued and Sold
</TABLE>