EXHIBIT 10.17
CONFIDENTIAL TREATMENT
Portions of this exhibit have been
omitted pursuant to a request for confidential treatment filed with
the Securities and Exchange Commission pursuant to Rule 24b-2
under the Securities Exchange Act of 1934. Such portions are
marked “[*]” in this document; they have been filed
separately with the Commission.
AMENDMENTS NO. 1-3 TO SPECTRUM
MANAGER LEASE AGREEMENT
entered into as of February 13,
2008, June 11, 2008
and November 26, 2008,
respectively
between Globalstar Licensee LLC, a
Delaware limited liability company and a wholly-owned subsidiary of
Globalstar, Inc. with its principal place of business located
at 461 South Milpitas Blvd., Building 5, Milpitas, CA 95035
(“Lessor”) and Open Range Communications, Inc., a
Delaware corporation with its principal place of business located
at 8100 E Maplewood Avenue, Greenwood Village CO 80111
(“Lessee”) (collectively the “Parties” or,
individually, a “Party”).
WITNESSETH
WHEREAS , the Parties entered into that certain Spectrum
Manager Lease Agreement dated as of October 31, 2007 (as
amended through the date hereof, “the Lease
Agreement”); and
WHEREAS , at the Lease Commencement Date (as such term
is defined in the Lease Agreement), the Lease Agreement will
initially apply only to 6,000,000 Pops and [*] MHz of GSAT Spectrum
(as such terms are defined in the Lease Agreement); and
WHEREAS , the Parties desire to amend the Lease
Agreement as set forth herein; and
NOW THEREFORE
, in consideration of the mutual
promises contained herein, the Parties hereby agree as
follows:
1.
The second sentence of
Section 1(a) is stricken in its entirety and a new
sentence is inserted in lieu thereof as follows:
“The Parties acknowledge that
the Initial Markets include 6,000,000 Pops and [*] MHz of GSAT
Spectrum (such spectrum being subject to increase as set forth
herein) with “Pops” being defined as the population of
a “Place,” as used for the reporting of decennial
census data, including census designated places, consolidated
cities and incorporated places, based on 2000 Census Data and
extrapolated to 2006 using county growth rate
demographic
information as provided by Claritas
and included in Exhibit C hereto.”
2.
The lead-in to
Section 8(a) of the Lease Agreement is stricken in its
entirety and a new lead-in to Section 8(a) is inserted in
lieu thereof as follows:
“8(a) Ongoing Lease
Agreement Payments for Initial Markets and Deferred Pop Markets
. Beginning on the Lease Commencement Date (except as
otherwise set forth below) and continuing on the same day of each
month thereafter until the expiration or termination of the term of
this Lease Agreement, Lessee will pay to Lessor monthly lease
payments as follows:”
3.
Section 8(a)(i) of the
Lease Agreement is stricken in its entirety and a new
Section 8(a)(i) is inserted in lieu thereof as
follows:
“(i) Fixed monthly
payments (“Fixed Lease Payments”) and down payments
(“Down Payments”) as set forth on Exhibit D
hereto. Notwithstanding anything to the contrary in the Lease
Agreement or any Exhibit, the Parties agree that the Fixed Lease
Payments payable under this Lease Agreement shall be as set forth
in Exhibit D, as amended from time to time, as appropriately
adjusted for the amount of MHz and Pops leased. All
references to Exhibit D in this Lease Agreement or any
Exhibit shall mean Exhibit D, as amended from time to
time based upon the notes included thereon. The Down Payment
for the Initial Markets with respect to the frequency band [*] MHz
shall be payable on the Lease Commencement Date. The Fixed
Lease Payments for the Initial Markets with respect to the
frequency band [*] MHz shall begin on [*]. Beginning on the
earlier of [*] or the date of the L-Band Notice (as defined below),
Lessee shall pay, in addition to all other payments due under this
Lease Agreement, an amount per month that is sufficient to pay in
full over a 24-month period the total amount of Fixed Lease
Payments that would have accrued from the Lease Commencement Date
through [*] (rounded to the nearest whole month) if the Fixed Lease
Payments for the Initial Markets with respect to the frequency band
[*] MHz had begun to be payable on the Lease Commencement Date
rather than on [*]. The Fixed Lease Payments for the Deferred
Pop Markets with respect to the frequency band [*] MHz shall begin,
and the Down Payment for such Deferred Pop Markets shall be
payable, on the earlier of (A) the date on which Lessee begins
offering any ORC Services in such market pursuant
to Section 10(a) hereof
and (B) the first day of the [*] month following the Lease
Commencement Date (except as otherwise set forth in
Section 10(a)(v) below). Additionally Lessee shall have
no obligation to make any Down Payment, Fixed Lease Payment or
Variable Lease Payment with respect to the frequency band [*] MHz
and no such payment shall begin to accrue unless prior to [*]
Lessee notifies Lessor in writing (the “L-Band Notice”)
that it chooses to lease spectrum usage rights with respect to such
frequency band, in which case this Lease Agreement shall apply to
such frequency band beginning [*] and all such payments shall begin
on such date. If Lessee fails to provide such notice to
Lessor prior to [*], Lessee’s right to lease spectrum usage
rights for the frequency band [*] MHz shall lapse and Lessee shall
have no further obligation with respect thereto. For the avoidance
of doubt, the parties agree that, notwithstanding anything to the
contrary in this Lease Agreement or any exhibit hereto:
(X) the Down Payment payable on the Lease Commencement Date
for the Initial Markets shall be $[*], (Y) the additional Down
Payment for the Initial Markets payable with respect to the
frequency band [*] MHz on [*] if Lessor delivers the L-Band Notice
by such time shall be $[*], and (Z) the Down Payment for the
Deferred Pop Markets, subject to Section 10(a)(v), shall be
$[*] if Lessee delivers the L-Band Notice, otherwise the Down
Payment for the Deferred Pop Markets shall be $[*]. If Lessee is
not able to use a portion of the GSAT Spectrum for the provision of
WiMAX services due to a regulatory restriction imposed by the FCC,
the Down Payment and all Fixed Lease Payments shall be adjusted so
that they apply proportionately based on the portion (determined by
number of MHz) of GSAT Spectrum actually available for use by
Lessee for the provision of WiMAX services, as more specifically
set forth on Exhibit D hereto.”
4.
Section 10(a)(v) of the
Lease Agreement is stricken in its entirety and a new
Section 10(a)(v) is inserted in lieu thereof as
follows:
“(v) For avoidance of
doubt, the fact that a market has been identified by Lessee as a
Deferred Pop Market will not, by itself, cause Lessee to be liable
for payment for the Pops within such market under this Lease
Agreement. The payment obligations for such Deferred Pop
Market under Section 8 and Exhibit D hereof will begin on
the earlier of i) the beginning of the [*] month following the
Lease Commencement Date and ii) the date on which Lessee
begins offering any ORC Services in
such market, provided that on or before [*] Lessee may at its
discretion notify Lessor in writing that it will not lease
the spectrum usage rights for the Deferred Pop Markets in which
case Lessee’s right to lease such rights for the Deferred Pop
Markets will terminate and Lessee shall have no further obligation
with respect to the Deferred Pop Markets (including no obligation
to make the Down Payment with respect thereto). If Lessee has
not notified Lessor that it will not lease the spectrum usage
rights in the Deferred Pop Markets and Lessee has not identified in
writing to Lessor the Deferred Pop Markets in accordance with this
Section by the end of the [*] month following the Lease
Commencement Date, Lessee shall be liable for payment for all [*]
Deferred Pops under this Lease Agreement, whether or not it is
providing service in any Deferred Pop Markets at such time.
Once payment obligations begin for the Deferred Pop Markets, all
other terms of this Lease Agreement (except as specifically
otherwise noted herein) shall apply to the Deferred Pop
Markets.”
5.
Section 14(d)(v) is added
as follows:
“(v) Any other provision
of this Agreement to the contrary notwithstanding (but still
subject to the provisions of Section 14(d)(vi), Lessee may
terminate the lease of GSAT Spectrum pursuant to this Lease
Agreement for convenience, with or without cause, upon written
notice to Lessor and payment of a cash termination fee to Lessor in
the amount of (A) [*] of the net present value, determined
assuming a [*]% per annum discount rate, of the remaining Fixed
Lease Payments during the Initial Term as set forth in
Exhibit D hereto (which shall include, without limitation,
Fixed Lease Payments for all markets in which Lessee is providing
service at that time, and all Deferred Pop Markets for which Lessee
has entered into a sublease of spectrum with a third party whether
or not service is then being provided, but not including any other
Deferred Pop Markets for which payment has not yet begun or to the
extent that Lessor continues to receive revenue from any of
Lessee’s sublessees following termination of the Lease
pursuant to this section), plus (B) an amount determined by
multiplying the monthly Variable Lease Payment in effect at such
time by the number of ORC subscribers on the termination date
multiplied by the number 48, in which case Lessee will have no
obligation to make any further payments of any kind hereunder,
except for any payments
that relate to periods prior to the
termination date. Following valid notice of termination, this
Lease Agreement and all rights and obligations of the Parties
hereunder shall terminate, except the obligation to make any
payments that relate to periods prior to the termination date, and
the provisions hereof relating to termination, indemnification,
dispute resolution and confidentiality (which shall survive the
termination of this Lease Agreement).
6.
Section 14(d)(vi) is added
as follows:
“(vi) Any other provision
of this Agreement to the contrary notwithstanding, in the event
(A) the Board of Directors of Lessee votes to abandon
Lessee’s plan to deploy its system or to dissolve and wind
down the business of Lessee and Lessee commences to do the same
(including returning capital to its preferred investors) , or
(B) if the RUS ceases to lend to Lessee, or if the RUS Loan is
terminated for any reason (including repayment of the Loan by ORC,
but not including a refinancing or other replacement of the RUS
Loan that would permit Lessee to continue to deploy its system) or
(C) the Lessee becomes reasonably insecure as to the ability
of the Lessor to comply with, or secure from the FCC an extension
of time to comply with, any conditions or requirements applicable
to or affecting its authorization to provide or permit Lessee to
provide ATC services as contemplated in this Lease Agreement,
including but not limited to the conditions and requirements
imposed by the FCC in its Order and Authorization, FCC 08-254,
released October 31, 2008 (the “Globalstar WiMAX
Order”) (File No. SAT-MOD-20080516-00106) as they may be
amended from time to time, then Lessee shall have the right, which
must be exercised by written notice to Lessor delivered prior to
[*]. Following valid notice of termination, this Lease
Agreement and all rights and obligations of the Parties hereunder
shall terminate (including, but not limited to, the obligation to
make any further Down Payments, Fixed Lease Payments, or any cash
termination fee), except the obligation to make any payments that
relate to periods prior to the termination date, and the provisions
hereof relating to termination, indemnification, dispute resolution
and confidentiality (which shall survive the termination of this
Lease Agreement).
