Assignment and Novation Agreement - XM Satellite Radio Inc., XM Satellite Radio Holdings Inc. and Boeing Satellite Systems International Inc.
ASSIGNMENT AND NOVATION AGREEMENT
THIS ASSIGNMENT AND NOVATION AGREEMENT (this "Agreement") is made as
of December 5, 2001 by and between XM Satellite Radio Inc. ("Assignor"), a
Delaware corporation and wholly-owned subsidiary of XM Satellite Radio
Holdings Inc., having its principal place of business at 1500 Eckington
Place, N.E., Washington, DC 20002-2194, and XM Satellite Radio Holdings Inc.
("Assignee"), a Delaware corporation, having its principal place of business
at 1500 Eckington Place, N.E., Washington, DC 20002-2194, and Boeing
Satellite Systems International, Inc. formerly Hughes Space and
Communications International, Inc. ("BSSI"), a Delaware corporation having
its principal place of business at 2260 E. Imperial Highway, El Segundo,
California 90245.
WHEREAS, Assignor and BSSI are parties to a Satellite Purchase Contract
for In-Orbit Delivery, dated as of March 23, 1998, which as recently amended and
restated and then further amended as of even date herewith immediately prior to
giving effect to this Agreement, remains in full force and effect (as amended,
amended and restated or otherwise modified to the date hereof, the "Satellite
Purchase Contract");
WHEREAS, Assignor desires to transfer and assign to Assignee its
rights, duties and obligations under the Satellite Purchase Contract with
respect to the Ground Spare Satellite Bus (as defined below), but not with
respect to the Ground Spare Satellite Payload (as defined below) or any other
Satellite or portion thereof, as more fully set forth on SCHEDULE A hereto (the
"Assets");
WHEREAS, Assignee desires to acquire the Assets from Assignor for the
consideration set forth below and on the terms and conditions hereinafter set
forth;
WHEREAS, Assignor desires to be discharged from the performance of the
obligations enumerated in the Satellite Purchase Contract with respect to the
Assets and to retain all rights, duties and obligations under the Satellite
Purchase Contract with respect to the Ground Spare Satellite Payload and XM-1
and XM-2;
WHEREAS, BSSI is willing to release Assignor from the obligations
enumerated in the Satellite Purchase Contract only with respect to the Assets
and to consent to Assignee assuming such obligations;
NOW THEREFORE, in consideration of the mutual covenants herein
contained, the parties agree for themselves, their successors and assigns, as
follows:
1. Assignor hereby assigns, transfers, conveys and delivers to Assignee,
effective as of December ___, 2001 (the "Effective Date"), all of
Assignor's right, title and interest in, to and under the Assets,
subject to any existing liens and encumbrances on the Assets in favor
of BSSI arising under the terms of the Satellite Purchase Contract, but
free and clear of all other liens and encumbrances.
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2. Assignee hereby accepts such assignment and agrees to assume, from and
after the Effective Date, all of Assignor's rights, duties and
obligations in, to and under the Assets set forth in SCHEDULE A,
subject to any liens and encumbrances on the Assets in favor of BSSI
arising under the terms of the Satellite Purchase Contract, but free
and clear of all other liens and encumbrances. Upon such assignment and
assumption, Assignor shall be released from all rights, duties and
obligations with respect to the Assets, and Assignee agrees to
reimburse Assignor for and hold Assignor harmless against any
obligation to perform any of the assigned duties and obligations
included in the Assets.
3. Assignor, Assignee and BSSI hereby agree that this Agreement shall
constitute a novation of the obligations of Assignor under the
Satellite Purchase Contract solely with respect to the Assets.
Accordingly, all of the rights, duties and obligations of Assignor
under the Satellite Purchase Contract are hereby extinguished with
respect to the Assets, but only to the extent they have been assigned
to and assumed by Assignee hereunder. All of Assignor's rights, duties
and obligations under the Satellite Purchase Contract not expressly
assigned and assumed by Assignee hereunder shall be retained by
Assignor. BSSI recognizes Assignee as Assignor's successor in interest
in and to all of Assignor's rights, duties and obligations in, to and
under the Assets.
4. In consideration of the assignment of the Assets, Assignee is hereby
(i) paying to Assignor an aggregate purchase price of Thirty-One
Million Six Hundred Thousand Dollars ($31,600,000) in cash, by wire
transfer to an account specified in writing by Assignor, or by such
other means as may be agreed by Assignor and Assignee.
5. This Agreement shall inure to the benefit of and be binding upon the
parties hereto and their successors and assigns, and matters herein
with respect to the Satellite Purchase Contract shall inure to the
benefit of BSSI and its successors and assigns from and after the
Effective Date.
6. The parties hereto agree that they will take those actions reasonably
necessary to carry out the matters contemplated by this Agreement or
any of its provisions.
7. Assignor, Assignee and BSSI consent to all of the provisions of this
Agreement.
8. For purposes of this Agreement, "Ground Spare Satellite Bus" means the
Ground Spare Satellite, except for the Ground Spare Satellite Payload.
"Ground Spare Satellite Payload" means the following components of the
Ground Spare Satellite: (i) all hardware above the four-point interface
above the bus module; and (ii) all antenna structures, deployment
mechanisms and reflectors.
9. Capitalized terms used but not otherwise defined in this Agreement
shall have the respective meanings as set forth in the Satellite
Purchase Contract.
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IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the date
first written above.
XM SATELLITE RADIO INC.
By:
-----------------------------------------
Name:
Title:
XM SATELLITE RADIO HOLDINGS INC.
By:
-----------------------------------------
Name:
Title:
Pursuant to Article 34.1(b) of the Satellite Purchase Contract, BSSI hereby
approves, as of the Effective Date, the assignment and assumption of the
Satellite Purchase Contract, as reflected in the assignment and assumption of
Assets as set forth in the foregoing Agreement, and agrees to the release of
Assignor in paragraph (2) above and the novation of the Satellite Purchase
Contract in paragraph (3) above.
BOEING SATELLITE SYSTEMS INTERNATIONAL, INC.
By:
-----------------------------------------
Name:
Title:
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SCHEDULE A
ASSETS
For purposes of this Agreement, "Assets" shall mean the following:
All of Assignor's rights, duties and obligations under the Satellite
Purchase Contract with respect to the Ground Spare Satellite (but not any other
Satellite) other than Assignor's rights, duties and obligations with respect to
the Ground Spare Satellite Payload, which rights, duties and obligations are
being retained by Assignor.
The assigned rights, duties and obligations shall include, but not be limited
to, any and all of Assignor's:
(i) rights to completion, testing, storage, insurance and delivery of
the Ground Spare Satellite (other than with respect to the Ground
Spare Satellite Payload),
(ii) rights in the Ground Spare Satellite (other than the Ground Spare
Satellite Payload), once delivered in accordance with the
Satellite Purchase Contract,
(iii) duties and obligations to make payments under the Satellite
Purchase Contract relating to the Ground Spare Satellite,
including but not limited to Milestone Payments, performance
incentive payments, payments for storage costs, payment of
deferred financing obligations and payments for launch services
(it being agreed that One Hundred (100%) percent of such payments
applicable to the Ground Spare Satellite remaining unpaid as of
the date of this Agreement shall be included in the Assets
described herein),
(iv) performance obligations and duties relating to the Ground Spare
Satellite, other than with respect to the Ground Spare Satellite
Payload, under (and subject to the conditions set forth in) the
Satellite Purchase Contract and
(v) all continuing rights, duties and obligations as Customer under
the Satellite Purchase Contract insofar as they relate to the
Ground Spare Satellite (other than with respect to the Ground
Spare Satellite Payload); it being understood that Assignor
retains all continuing rights, duties and obligations as Customer
under the Satellite Purchase Contract with respect to the Ground
Spare Satellite Payload, XM-1 and XM-2.