Exhibit 10.12
Intelsat Global,
Ltd.
May 6, 2009
David McGlade
[Address]
[Address]
Dear Mr. McGlade:
Reference is made to (i) that
certain Management Shareholders Agreement (the “
Management Shareholders Agreement ”) of Intelsat
Global, Ltd. (formerly known as Serafina Holdings Limited, the
“ Company ”), effective as of February 4,
2008, by and among the Company, the “ Sponsor
Shareholders ” as defined therein, and each of the
individual shareholders who become parties thereto from time to
time (each individually, a “ Management Shareholder
,” and collectively, the “ Management
Shareholders, ” and together with the Sponsor
Shareholders, the “ Shareholders ” and each a
“ Shareholder ”) (ii) that certain
Employment Agreement (the “ Employment Agreement
”) effective as of February 4, 2008 by and between you
and the Company, (iii) that certain Class A Restricted
Share Agreement executed on May 6, 2009 by you and the Company
(the “ Class A Restricted Share Agreement ”),
(iv) that certain Share Option Agreement dated as of
May 6, 2009 by and between you and the Company (the “
Option Agreement ”) and (v) that certain Class B
Restricted Share Agreement dated as of May 6, 2009 by and
between you and the Company (the “ Class B Restricted
Share Agreement ” and together with the Class A
Restricted Share Agreement and the Option Agreement, the “
Equity Award Agreements ”). For purposes of this
Letter Agreement, “ Co-Investment ” shall mean
the purchase of 100,000 Class A Shares from the Company for
$100 per share as of May 6, 2009 by the McGlade Family Trust
dated January 2, 2009 (the “ Trust ”)
pursuant to that certain Subscription Agreement by and between the
Trust and the Company dated May 6, 2009. Capitalized terms
used but not otherwise defined in this letter agreement (the
“ Letter Agreement ”) shall have the meanings
ascribed to them in the Management Shareholders
Agreement.
1. Interpretation.
The Trust represents and warrants
that it is a trust for the benefit of David McGlade or his
Permitted Family Members (except for ultimate contingent
beneficiaries). The parties to this Letter Agreement acknowledge
and agree that, notwithstanding anything to the contrary in the
Management Shareholders Agreement, the Trust shall be considered a
Management Shareholder for purposes of the Management Shareholders
Agreement; provided , that all references in the Management
Shareholders Agreement to (a) the status of the Management
Shareholder as an employee, (b) the employment, death or
Permanent Disability of the Management Shareholder or (c) the
Termination of Employment of the Management Shareholder (and any
similar references) shall be deemed to be references, as
applicable, to the status, employment, death, Permanent Disability
or Termination of Employment of David McGlade, a natural person,
rather than references to the Trust. For purposes of this Letter
Agreement, “you” and “your” and similar
designations shall be deemed to refer to David McGlade, a natural
person, and to the Trust, as the context indicates.
2. Company Call Right .
Notwithstanding anything to the
contrary in the Management Shareholders Agreement, the following
additional Section 8(b) of the Management Shareholders
Agreement shall apply solely with respect to the
Co-Investment:
“(b) With
respect to all Restricted Shares issued to the Management
Shareholder pursuant to the Subscription Agreement by and between
the Management Shareholder and the Company dated May 6, 2009
(the “ Subscription Agreement ”), the Company
may repurchase such Restricted Shares at any time during the
two-year period following the date of any Termination of
Employment, at a purchase price per Restricted Share equal to the
Fair Market Value of such Restricted Share as of the date of such
repurchase, or, with respect to any Restricted Shares that have
been awarded to the Management Shareholder pursuant to
Section 1.2 of the Subscription Agreement, the New Equity
Price (as defined in the Subscription Agreement); provided
that upon a Termination of Employment by the Company without Cause
(as defined in the Employment Agreement by and between David
McGlade and the Company, dated as of December 29, 2008 and
effective as of February 4, 2008 (the “ Employment
Agreement ”)), by the Management Shareholder for Good
Reason (as defined in the Employment Agreement) or due to the
Management Shareholder’s death or Permanent Disability (as
defined in the Employment Agreement) such Restricted Shares will
remain outstanding and will not be subject to a Call Right until
the 180 th day following such Termination
of Employment. Notwithstanding the foregoing, if the Fair Market
Value of any such Restricted Share on the date of a Termination of
Employment by the Company without Cause (as defined in the
Employment Agreement), by the Management Shareholder for Good
Reason (as defined in the Employment Agreement) or due to the
Management Shareholder’s death or Permanent Disability (as
defined in the Employment Agreement) is less than the Fair Market
Value of a Class A Share on the date such Class A Share
was purchased by the Management Shareholder or, with respect to any
Restricted Shares that have been awarded to the Management
Shareholder pursuant to Section 1.2 of the Subscription
Agreement, the New Equity Price (the “ Initial Value
”), then the Company shall not repurchase any such Restricted
Share until the Fair Market Value of such Restricted Share equals
or exceeds the Initial Value. Immediately prior to the occurrence
of any Initial Public Offering or Listing Event, and subject to the
consummation of such Initial Public Offering or such Listing Event,
the Company shall no longer have any of the repurchase rights set
forth in this Section 8(b) with respect to Restricted Shares.
The Call Right shall be exercised by a “Call Notice given in
accordance with Section 15(f).”
3. Conversion of Shares
.
Notwithstanding anything to the
contrary in the Management Shareholders Agreement, with respect to
the Class B Shares held by you and your Permitted Transferees, in
the event that the Board implements a conversion (“
Conversion ”) of any or all of the outstanding
Class A Shares and Class B Shares into one single class of
common stock or converts any or all of the outstanding Class B
Shares into Class A Shares (in either case, “ Company
Common Shares ”), unless otherwise agreed by the parties,
immediately following such Conversion the Company shall grant you
an option (the “ New Option ”) to purchase that
number of Company Common Shares such that upon the grant of the New
Option your fully diluted ownership of the Company with respect to
Company Common Shares received upon the Conversion of Class B
Shares and
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the New Option, as determined on a percentage
basis and assuming the New Option is exercised with respect to all
shares covered thereby, remains the same as your fully diluted
ownership of the Company with respect to the Class B Share awards
immediately prior to the Conversion. The New Option shall have an
exercise price equal to the Fair Market Value per Company Common
Share as of the date of grant, shall have a maximum term through
February 4, 2018, shall be eligible to become vested on the
same terms as the Class B Share awards subject to the Conversion
(based on an initial grant date of February 4, 2008 and an
initial vesting date of August 4, 2008) and shall otherwise
have terms substantially the same as those applicable to the share
option granted to you by the Company on May 6, 2009 (the
“ Option ”).
4. Piggy-Back Registration
Rights .
Notwithstanding anything to the
contrary in the Management Shareholders Agreement, you shall have
the following “piggy-back” registration rights with
respect to your fully vested Restricted Shares, including, without
limitation, any Co-investment Shares, vested Class A
Restricted Shares, vested Class B Restricted Shares, and any shares
acquired upon the exercise of vested Options prior to such
Registration:
(a) Company Registration
.
(i) Following any Initial Public
Offering or Listing Event by the Company, if the Company shall
determine to Register any of its equity securities either for its
own account or for the account of the Sponsor Shareholders other
than a Registration (x) relating solely to employee stock or
benefit plans, (y) relating solely to a Commission Rule 145
transaction, or (z) on any registration form which does not
permit secondary sales or does not include substantially the same
information as would be required to be included in a registration
statement covering the sale of Registrable Securities, the Company
will:
(A) promptly give to you a written
notice thereof; and
(B) include in such Registration
(and any related qualification under blue sky laws or other
compliance), and in any underwriting involved therein, all the
Registrable Securities specified in a written request or requests,
made by you within fifteen (15) days after receipt of the most
recent written notice from the Company described in clause
(A) above, as the case may be, except as set forth in
Section 4(a)(ii)(B) below. Such written request may specify
all or a part of your Registrable Securities, as the case may
be.
(ii) Underwriting
.
(A) If the Registration of which the
Company gives notice is for a registered public offering involving
an underwriting, the Company shall so advise you as a part of the
written notice given pursuant to Section 4(a)(i)(A). In such
event, your right pursuant to this Section 4 shall be
conditioned upon your participation in such underwriting and the
inclusion of your Registrable Securities in the underwriting to the
extent provided herein. You shall agree to sell your shares on the
basis provided in any customary underwriting arrangements approved
by the Company and complete and execute all customary
questionnaires, power of attorney, indemnities and other
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documents, in each case in customary
form, required for such underwriting arrangements and enter into an
underwriting agreement in customary form with the representative of
the underwriter or underwriters selected for underwriting by the
Company.
(B) Notwithstanding any other
provision of this Section 4, if the representative of the
underwriter or underwriters determines that marketing factors
require a limitation on the number of shares to be underwritten,
the representative may exclude from such Registration and
underwriting some or all of the Registrable Securities which would
otherwise be underwritten pursuant hereto. The Company shall so
advise you, and subject to the next paragraph, the number of shares
of securities that may be included in the Registration and
underwriting by you shall be reduced, by such minimum number of
shares as is necessary to comply with such limitation. For the
avoidance of doubt, none of the securities being Registered by the
Company for its own account shall be excluded. If you disapprove of
the terms of any such underwriting, you may elect to withdraw
therefrom by written notice to the Company and the underwriter. Any
Registrable Securities or other securities excluded or withdrawn
from such underwriting shall be withdrawn from such
registration.
The Company shall give written
notice to you of the receipt of a request for registration pursuant
to this Section 4(a) and shall provide you with a reasonable
opportunity to participate in the Registration on substantially the
same terms as the Company’s participation therein;
provided , that the Sponsor Shareholders are not treated
more favorably than you with respect to piggyback rights, cutbacks
and other limitations; and provided further , that if the
Registration is for an underwritten offering, the terms of this
Section 4(a)(ii) shall apply to all participants in such
offering.
(b) Company Control . The
Company may decline to file a registration statement referenced to
in Section 4(a), or withdraw such registration statement after
filing, but prior to the effectiveness of the registration
statement; provided that such restriction applies to all
security holders selling securities through such registration
statement; provided further that the Company shall promptly
notify you in writing of any such action. You shall not be
permitted to sell any securities pursuant to Section 4(a) at
any time that the Board determines in good faith that it would be
materially detrimental to the Company or its shareholders for sales
of securities to be made; provided that the Company shall
promptly notify you in writing of any such action. The Company
shall have the sole discretion to select any and all underwriters
that may participate in any underwritten offering.
(c) Expenses of Registration
. All Registration Expenses incurred in connection with any
Registration, qualification or compliance pursuant to this
Section 4 shall be borne by the Company, except that the
following expenses shall be borne by you: (i) the costs and
expenses of counsel to you to the extent you retain counsel (except
the costs of one legal counsel for all selling shareholders to the
extent retained, which shall be borne by the Company);
(ii) underwriting discounts, commissions, fees or similar
compensation owing to underwriters, selling brokers, dealer
managers or other industry professionals, to the extent relating to
the distribution or sale of your securities; and
(iii) transfer taxes with respect to the securities sold by
you.
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(d) Registration Procedures .
In the case of each Registration effected by the Company pursuant
to this Section 4, the Company will keep you advised in
writing as to the initiation of each Registration, the effective
time of each such Registration, and the completion thereof. At its
expense, the Company will, subject to the terms of this
Section 4:
(i) keep such Registration that has
become effective continuously current and effective, and not
subject to any stop order, injunction or other similar order or
requirement of the Commission, until the earlier of (x) the
expiration of the Required Period and (y) the date on which
all Registrable Securities covered by such Registration
(i) have been disposed of pursuant to such Registration or
(ii) cease to be Registrable Securities; provided that
in no event will such period expire prior to the expiration of the
applicable period referred to in Section 4(3) of the
Securities Act and Rule 174 promulgated thereunder. In the event of
any stop order, injunction or other similar order or requirement of
the Commission or any other governmental or regulatory authority
relating to any Registration, the Required Period for such
Registration will be extended by the number of days during which
such stop order, injunction or similar order or requirement is in
effect.
(ii) furnish such number of copies
of prospectuses, offer documents and other documents incident
thereto as you from time to time may reasonably request;
(iii) notify you as a holder of
Registrable Securities covered by such Registration at any time
when a prospectus relating thereto is required to be delivered
under the Securities Act or other applicable law of the happening
of any event as a result of which the prospectus included in such
registration statement, as
