Exhibit 10.2

EXECUTION COPY

 

 

 

$100,000,000

CREDIT AGREEMENT

dated as of

June 26, 2008

among

XM SATELLITE RADIO INC.,

XM SATELLITE RADIO HOLDINGS INC.,

The Lenders Party Hereto,

and

UBS AG, STAMFORD BRANCH

as Administrative Agent

 

 

UBS SECURITIES LLC

as Sole Bookrunner and Sole Lead Arranger

 

 

 

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TABLE OF CONTENTS

 

         

Page

ARTICLE I. Definitions SECTION 1.01    Defined Terms    1 SECTION 1.02   
Classification of Loans and Borrowings    41 SECTION 1.03    Terms Generally   
41 SECTION 1.04    Accounting Terms; GAAP    41 ARTICLE II. The Credits SECTION
2.01    Loan Commitments    41 SECTION 2.02    Types of Loans    42 SECTION 2.03
   Request for Borrowing    42 SECTION 2.04    Reserved    43 SECTION 2.05   
Reserved    43 SECTION 2.06    Funding of Loans    43 SECTION 2.07    Interest
Elections    43 SECTION 2.08    Reserved    44 SECTION 2.09    Repayment of
Loans; Evidence of Debt    44 SECTION 2.10    Prepayment of Loans and Asset Sale
Offer    45 SECTION 2.11    Fees    46 SECTION 2.12    Interest    46 SECTION
2.13    Alternate Rate of Interest    46 SECTION 2.14    Increased Costs    47
SECTION 2.15    Break Funding Payments    48 SECTION 2.16    Taxes    48 SECTION
2.17    Payments Generally; Pro Rata Treatment; Sharing of Set-offs    50
SECTION 2.18    Mitigation Obligations; Replacement of Lenders    51 ARTICLE
III. Representations and Warranties SECTION 3.01    Organization; Powers    52
SECTION 3.02    Authorization; Enforceability    52

SECTION 3.03

   Governmental Approvals; No Conflicts    53

SECTION 3.04

   Financial Condition; No Material Adverse Change    53

SECTION 3.05

   Litigation    54

SECTION 3.06

   Compliance with Laws and Agreements    54

SECTION 3.07

   Investment Company Status    54

SECTION 3.08

   Taxes    54

SECTION 3.09

   ERISA    55

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SECTION 3.10    Federal Reserve Regulations    55 SECTION 3.11    Title to
Properties; Possession Under Leases    55 SECTION 3.12    Subsidiaries    56
SECTION 3.13    Disclosure    56 SECTION 3.14    Environmental Matters    57
SECTION 3.15    Security Documents    57 SECTION 3.16    Solvency    58 ARTICLE
IV. Conditions SECTION 4.01    Closing Date    59 SECTION 4.02    Each Credit
Event    61 ARTICLE V. Affirmative Covenants SECTION 5.01    Financial
Statements; and Other Information    62 SECTION 5.02    Notices of Material
Events    63 SECTION 5.03    Existence; Conduct of Business    64 SECTION 5.04
   Obligations and Taxes    64 SECTION 5.05    Maintenance of Properties;
Insurance    65 SECTION 5.06    Books and Records; Inspection Rights    65
SECTION 5.07    Compliance with Laws    65 SECTION 5.08    Use of Proceeds    66
SECTION 5.09    Compliance with Environmental Laws    66 SECTION 5.10    Further
Assurances    66 ARTICLE VI. Negative Covenants SECTION 6.01    Incurrence of
Indebtedness and Issuance of Disqualified Stock    68 SECTION 6.02    Liens   
72 SECTION 6.03    Merger, Consolidation or Sale of Assets    72 SECTION 6.04   
Dividend and Other Payment Restrictions Affecting Material Subsidiaries    73
SECTION 6.05    Sale and Leaseback Transactions    75 SECTION 6.06    Restricted
Payments    75

SECTION 6.07

   Transactions with Affiliates    79

SECTION 6.08

   Negative Pledge    80

SECTION 6.09

   Liquidity Test    80

SECTION 6.10

   Line of Business    81

SECTION 6.11

   Amendments or Waivers of the Security Documents, Senior Notes Documents,
Revolving Credit Facility Agreement and the Distribution and Credit Agreement   
81

 

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SECTION 6.12    Reserved    82 SECTION 6.13    XM-4 Satellite Collateral    82
SECTION 6.14    Limitation on Outstandings and Use of Cash    82 ARTICLE VII.
Events of Default ARTICLE VIII. The Administrative Agent SECTION 8.01   
Appointment    86 SECTION 8.02    Administrative Agent in its Individual
Capacity    86 SECTION 8.03    Exculpatory Provisions    86 SECTION 8.04   
Notice of Default    87 SECTION 8.05    Reliance by the Administrative Agent   
87 SECTION 8.06    Delegation of Duties    87 SECTION 8.07    Successor
Administrative Agent    87 SECTION 8.08    Non-Reliance on Administrative Agent
and Other Lenders    88 SECTION 8.09    Indemnification    88 SECTION 8.10   
Arranger    88 ARTICLE IX. Miscellaneous SECTION 9.01    Notices    88 SECTION
9.02    Waivers; Amendments    89 SECTION 9.03    Expenses; Indemnity; Damage
Waiver    90 SECTION 9.04    Successors and Assigns    91 SECTION 9.05   
Agreements of Holdings    95 SECTION 9.06    XM-4 Satellite Collateral    96
SECTION 9.07    Survival    96 SECTION 9.08    Counterparts; Integration;
Effectiveness    96 SECTION 9.09    Severability    97 SECTION 9.10    Right of
Setoff    97 SECTION 9.11    Governing Law; Jurisdiction; Consent to Service of
Process    97 SECTION 9.12    WAIVER OF JURY TRIAL    98

SECTION 9.13

   Headings    98

SECTION 9.14

   Confidentiality    98

SECTION 9.15

   Interest Rate Limitation    99

SECTION 9.16

   USA PATRIOT Act    99

 

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SCHEDULES:

  

Schedule 2.01 – Commitments

Schedule 3.05 – Litigation

Schedule 3.12 – Subsidiaries

Schedule 3.14 – Environmental Matters

Schedule 3.17 – Chief Executive Offices of Loan Parties

Schedule 6.02 – Existing Liens

Schedule 6.06 – Restricted Payments

Schedule 6.08 – Existing Restrictions

Schedule 6.14 – Limitation on Outstandings and Use of Cash

Schedule 9.05 – Exceptions to Agreements of Holdings

EXHIBITS:

Exhibit A

 

–

  Form of Assignment and Assumption

Exhibit B

 

–

  Form of Opinion of Borrower’s Counsel

Exhibit C

 

–

  Form of Guarantee Agreement

Exhibit D

 

–

  Form of Solvency Certificate

Exhibit E

 

–

  Form of Collateral Agreement

Exhibit F

 

–

  Form of Perfection Certificate

Exhibit G

 

–

  Form of Second Lien Intercreditor Agreement

Exhibit H

 

–

  Form of Holdings Covenant and Collateral Release Notice

Exhibit I

 

–

  Form of Non-Bank Certificate

Exhibit J

 

–

  Form of Collateral Agency Agreement

Exhibit K

 

–

  Form of Joinder

 

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CREDIT AGREEMENT dated as of June 26, 2008 (this “Agreement”), among XM
SATELLITE RADIO INC., XM SATELLITE RADIO HOLDINGS INC., the LENDERS party
hereto, UBS AG, STAMFORD BRANCH, as Administrative Agent and UBS SECURITIES LLC,
as Sole Bookrunner and Sole Lead Arranger (the “Arranger”).

The parties hereto agree as follows:

ARTICLE I.

Definitions

SECTION 1.01 Defined Terms. As used in this Agreement, the following terms have
the meanings specified below:

“ABR”, when used in reference to any Loan, indicates that such Loan is bearing
interest at a rate determined by reference to the Alternate Base Rate.

“Acquired Debt” means, with respect to any specified Person (x) Indebtedness of
any other Person existing at the time such other Person is merged with or into
or became a Subsidiary of such specified Person or (y) Indebtedness secured by a
Lien encumbering any asset acquired by such specified Person; provided that, in
each case, such Indebtedness or Lien, as applicable, is not incurred in
connection with, or in contemplation of, such other Person merging with or into,
or becoming a Subsidiary of, such specified Person or in contemplation of the
acquisition of such assets by such specified Person.

“Act” means the USA Patriot Act (Title III of Pub. L. 107-56 (signed into law
October 26, 2001)).

“Adjusted LIBO Rate” means, with respect to any Eurodollar Loan for any Interest
Period, an interest rate per annum (rounded upwards, if necessary, to the next
1/16 of 1%) equal to (a) the LIBO Rate for such Interest Period multiplied by
(b) the Statutory Reserve Rate.

“Administrative Agent” means UBS AG, Stamford Branch, in its capacity as
administrative agent for the Lenders hereunder, or its successors in such
capacity.

“Administrative Questionnaire” means an Administrative Questionnaire in a form
supplied by the Administrative Agent.

“Affiliate” of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For purposes of this definition, “control,”
as used with respect to any Person, shall mean the possession, directly or
indirectly, of the power to direct or cause the direction of the management or
policies of such Person, whether through the ownership of voting securities, by
agreement or otherwise. For purposes of this definition, the terms
“controlling,” “controlled by” and “under common control with” shall have
correlative meanings.

“Affiliate Transaction” has the meaning assigned to such term in
Section 6.07(a).

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“Aggregate Required Lenders” has the meaning assigned to such term in
Section 6.11(d).

“Agreement” has the meaning assigned to such term in the introductory paragraph
of this Agreement and includes all Exhibits and Schedules hereto.

“Alternate Base Rate” means, for any day, a rate per annum equal to the greatest
of (a) the Prime Rate in effect on such day and (b) the Federal Funds Effective
Rate in effect on such day plus  1/2 of 1%. Any change in the Alternate Base
Rate due to a change in the Prime Rate or the Federal Funds Effective Rate shall
be effective from and including the effective date of such change in the Prime
Rate or the Federal Funds Effective Rate, respectively.

“Ancillary XM-4 Satellite Collateral” means any assets, licenses and/or usage
rights associated specifically with the XM-4 Satellite; provided, however, to
the extent that any such assets, licenses and/or usage rights are also
associated with one or more other satellites used or to be used by a Loan Party
(prior to the Holdings Covenant and Collateral Release Date) or by the Borrower
or the Subsidiary Loan Parties (after the Holdings Covenant and Collateral
Release Date) or other property or assets material to the business of such
party, only that portion, if any, of such assets, licenses and/or usage rights
that is divisible and separately conveyable shall constitute Ancillary XM-4
Satellite Collateral.

“Applicable Percentage” means, with respect to any Lender, the percentage of the
total Commitments represented by such Lender’s Commitment (or, if the
Commitments have terminated or expired, the percentage of the total Loans
represented by such Lender’s Loan).

“Applicable Rate” means, for any day, (a) with respect to any ABR Loan,
1.25% per annum, and (b) with respect to any Eurodollar Loan, 2.25% per annum.

“Arranger” has the meaning assigned to such term in the introductory paragraph
of this Agreement.

“Asset Sale” means (a) the sale, lease (as lessor), license, conveyance or other
disposition of any assets; and (b) the issuance of Equity Interests in any of
the Borrower’s Subsidiaries or the sale of Equity Interests in any of its
Subsidiaries (including in connection with the merger or consolidation of any
Subsidiary with or into another Person that results in the direct or indirect
ownership by the Borrower of less of the Equity Interests of such Subsidiary
than prior to such merger or consolidation).

Notwithstanding the foregoing, the following items shall not be deemed to be
Asset Sales:

(i) any single transaction or series of related transactions that involves
assets having a fair market value or that involve net proceeds of less than
$5,000,000;

(ii) a transfer of assets between or among the Borrower and the Borrower’s
Wholly Owned Subsidiary Guarantors;

(iii) an issuance of Equity Interests by a Wholly Owned Subsidiary Guarantor to
the Borrower or to another Wholly Owned Subsidiary Guarantor;

 

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(iv) the sale or lease of equipment, inventory, accounts receivable or other
assets in the ordinary course of business;

(v) the sale or other disposition of cash or Cash Equivalents;

(vi) a Restricted Payment or Permitted Investment that is permitted under
Section 6.06;

(vii) any Qualified Sale and Leaseback Transaction, including an XM-4 Sale and
Leaseback Transaction; and

(viii) the non-exclusive license of Intellectual Property in the ordinary course
of business.

“Asset Sale Offer” has the meaning assigned to such term in Section 2.10(c).

“Assignment and Assumption” means an assignment and assumption entered into by a
Lender and an assignee (with the consent of any party whose consent is required
by Section 9.04), and accepted by the Administrative Agent, in the form of
Exhibit A or any other form approved by the Administrative Agent.

“Attributable Debt” in respect of a sale and leaseback transaction means, at the
time of determination, the present value of the obligation of the lessee for net
rental payments during the remaining term of the lease included in such sale and
leaseback transaction including any period for which such lease has been
extended or may, at the option of the lessor, be extended. Such present value
shall be calculated using a discount rate equal to the rate of interest implicit
in such transaction, determined in accordance with GAAP.

“Beneficial Interest” has the meaning assigned to such term in the Participation
Agreement.

“Beneficial Interest Purchase Date” means any date on which the Borrower and/or
Holdings is required to purchase any or all of the Beneficial Interest pursuant
to the terms of the XM-4 Sale and Leaseback Offer to Purchase or Refinance and
in accordance with the terms of the Participation Agreement and this Agreement;
provided, however, that if the Beneficial Interest is purchased for a note or
other evidence of Indebtedness permitted to be incurred under the Credit
Agreement (including any Permitted Beneficial Interest Indebtedness), the
Beneficial Interest Purchase Date shall not occur until the date on which any or
all of the principal amount of such Indebtedness shall have been paid.

“Beneficial Owner” has the meaning assigned to such term in Rule 13d-3 and Rule
13d-5 under the Exchange Act, except that in calculating the beneficial
ownership of any particular “person” (as that term is used in Section 13(d)(3)
of the Exchange Act), such “person” shall be deemed to have beneficial ownership
of all securities that such “person” has the right to acquire by conversion or
exercise of other securities, whether such right is currently exercisable or is
exercisable only upon the occurrence of a subsequent condition. The terms
“beneficially owns” and “beneficially owned” shall have a corresponding meaning.

 

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“Board” means the Board of Governors of the Federal Reserve System of the United
States of America.

“Board of Directors” means (a) with respect to a corporation, the board of
directors of the corporation; (b) with respect to a partnership, the board of
directors of the general partner of the partnership (if a corporation); and
(c) with respect to any other Person, the board or committee of such Person
serving a similar function.

“Borrower” means XM Satellite Radio Inc., a Delaware corporation.

“Borrower Obligations” means the Credit Agreement Obligations.

“Borrowing” means Loans of the same Type, made, converted or continued on the
same date and, in the case of Eurodollar Loans, as to which a single Interest
Period is in effect.

“Borrowing Request” means a request by the Borrower for a Loan in accordance
with Section 2.03.

“Business Day” means any day that is not a Saturday, Sunday or other day on
which commercial banks in New York City are authorized or required by law to
remain closed; provided that, when used in connection with a Eurodollar Loan,
the term “Business Day” shall also exclude any day on which banks are not open
for dealings in dollar deposits in the London interbank market.

“Capital Lease Obligation” means, at the time any determination thereof is to be
made, the amount of the liability in respect of a capital lease that would at
that time be required to be capitalized on a balance sheet in accordance with
GAAP.

“Cash Equivalents” means:

(a) United States dollars;

(b) securities issued or directly and fully guaranteed or insured by the United
States government or any agency or instrumentality thereof (provided that the
full faith and credit of the United States is pledged in support thereof) having
maturities of not more than six months from the date of acquisition;

(c) certificates of deposit and Eurodollar time deposits with maturities of six
months or less from the date of acquisition, bankers’ acceptances with
maturities not exceeding six months and overnight bank deposits, in each case,
with any domestic commercial bank having capital and surplus in excess of
$500,000,000;

(d) repurchase obligations with a term of not more than seven days for
underlying securities of the types described in clauses (b) and (c) above
entered into with any financial institution meeting the qualifications specified
in clause (c) above;

 

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(e) commercial paper having one of the two highest ratings obtainable from
Moody’s Investors Service, Inc. or Standard & Poor’s Rating Services and in each
case maturing within six months after the date of acquisition; and

(f) money market funds at least 95% of the assets of which constitute Cash
Equivalents of the kinds described in clauses (a) through (e) of this
definition.

“Change in Control” means:

(a) at any time prior to the Merger Effective Time, the occurrence of any of the
following:

(i) Holdings shall cease to beneficially own and control at least 100% on a
fully diluted basis of the economic interests and voting power in the Equity
Interests of the Borrower;

(ii) the direct or indirect sale, transfer, conveyance or other disposition
(other than by way of merger or consolidation), in one or a series of related
transactions, of all or substantially all of the properties or assets of the
Borrower and its Material Subsidiaries taken as a whole to any “person” (as that
term is used in Section 13(d)(3) of the Exchange Act) other than a Principal or
a Principal Related Party;

(iii) the adoption of a plan relating to the liquidation or dissolution of the
Borrower;

(iv) the consummation of any transaction (including, without limitation, any
merger or consolidation) the result of which is that any “person,” other than
the Principals and the Principal Related Parties, becomes the Beneficial Owner,
directly or indirectly, of more than 35% of the Voting Stock of Holdings or the
Borrower, measured by voting power rather than number of shares; or

(v) the first day on which a majority of the members of the Board of Directors
of the Borrower or Holdings are not Continuing Directors; and

(b) at any time on or after the Merger Effective Time, the occurrence of any of
the following:

(i) SIRIUS shall cease to beneficially own and control at least 100% on a fully
diluted basis of the economic interests and voting power in the Equity Interests
of Holdings;

(ii) Holdings shall cease to beneficially own and control at least 100% on a
fully diluted basis of the economic interests and voting power in the Equity
Interests of the Borrower;

(iii) the direct or indirect sale, transfer, conveyance or other disposition
(other than by way of merger or consolidation), in one or a series of related
transactions, of all or substantially all of the properties or assets of the
Borrower and its Material Subsidiaries taken as a whole to any “person” (as that
term is used in Section 13(d)(3) of the Exchange Act);

 

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(iv) the adoption of a plan relating to the liquidation or dissolution of the
Borrower;

(v) any “person” (as such term is used in Sections 13(d) and 14(d) of the
Exchange Act), is or becomes the Beneficial Owner, directly or indirectly, of
more than 50% of the total voting power of the Voting Stock of SIRIUS, Holdings
or the Borrower (other than SIRIUS or a Wholly Owned Subsidiary thereof) (for
the purposes of this clause (v), such other person shall be deemed to
beneficially own any Voting Stock of a Person held by any other Person (the
“parent entity”), if such other person is the Beneficial Owner, directly or
indirectly, of more than 50% of the voting power of the Voting Stock of such
parent entity); or

(vi) any “change of control” or similar event (other than the Merger and/or any
Merger Related Event) under the New Senior Notes, the Owner Trustee Notes, the
Revolving Credit Facility Agreement, any Material Indebtedness (other than the
Existing 10% Notes, to the extent they constitute Material Indebtedness), and/or
any Material Indebtedness of SIRIUS, including in each case any Permitted
Refinancing Indebtedness in respect thereof.

Notwithstanding the foregoing, a Parent Company Merger shall not constitute a
Change in Control.

“Change in Control Offer” has the meaning assigned to such term in
Section 2.10(d).

“Change in Law” means (a) the adoption of any law, rule or regulation after the
date of this Agreement, (b) any change in any law, rule or regulation or in the
interpretation or application thereof by any Governmental Authority after the
date of this Agreement or (c) compliance by any Lender (or, for purposes of
Section 2.14(b), by any lending office of such Lender or by such Lender’s
holding company, if any) with any request, guideline or directive (whether or
not having the force of law) of any Governmental Authority made or issued after
the date of this Agreement.

“Closing Date” means the date on which the conditions specified in Section 4.01
are satisfied (or waived in accordance with Section 9.02).

“Code” means the Internal Revenue Code of 1986, as amended from time to time.

“Collateral” means (a) as of the Closing Date and until the Release Date, the
Existing Collateral, (b) from and after the Release Date and at all times
thereafter (until, in the case of Holdings only, the Holdings Covenant and
Collateral Release Date), all of the personal property (including Equity
Interests and Intellectual Property) of Holdings, the Borrower and the
Subsidiary Loan Parties in which Liens are purported to be granted pursuant to
the Security Documents (other than the Existing Collateral Documents) and
(c) with respect to Holdings only, from and after the Holdings Covenant and
Collateral Release Date, the Holdings Collateral, in each case, as security for
the Borrower Obligations and the Guarantor Obligations; provided that if at any
time none of the Obligations in respect of the Existing 10% Notes, the Revolving
Credit Facility Documents and the Distribution and Credit Agreement (including
if any release of such

 

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Liens with respect to the Obligations in respect of the Distribution and Credit
Agreement occurs concurrently with the automatic release referred to below) are
secured by the XM-4 Satellite Collateral, then such XM-4 Satellite Collateral
shall be automatically released from the Collateral without any further consent
of the Administrative Agent and/or the Lenders in connection with the
consummation of the XM-4 Sale and Leaseback Transaction.

“Collateral Agency Agreement” means the Collateral Agency Agreement, dated as of
June 26, 2008, as amended, restated, supplemented or otherwise modified from
time to time, in the form of Exhibit J, among the Administrative Agent, the New
Collateral Agent, the Revolving Credit Facility Administrative Agent and the
other parties from time to time party thereto.

“Collateral Agent” means The Bank of New York or such other Person then serving
as Collateral Agent under the Existing Collateral Documents.

“Collateral Agreement” means the Collateral Agreement, dated as of the Release
Date, as amended, supplemented or otherwise modified from time to time, in the
form of Exhibit E, among, the Borrower, Holdings, each Subsidiary Loan Party and
the New Collateral Agent.

“Collateral and Guarantee Requirement” means the requirement that:

(g) on the Closing Date, (I) the Administrative Agent shall have received from
Holdings and each Material Subsidiary a counterpart of the Guarantee Agreement
duly executed and delivered on behalf of such person and (II) each Lender, to
the extent required pursuant to the terms thereof, shall have executed a joinder
agreement in the form of Exhibit K hereto to each of the Existing Intercreditor
Agreements and become a “Secured Party” as defined thereunder and the Collateral
Agent, for the benefit of the New Secured Parties, shall have a valid security
interest in the Collateral pursuant to the Existing Collateral Documents and
such security interest shall be perfected to the extent required by the Existing
Collateral Documents;

(h) in the case of any person that becomes a Subsidiary Loan Party after the
Closing Date, the Administrative Agent shall have received a supplement to the
Guarantee Agreement, in the form specified therein, duly executed and delivered
by such Subsidiary Loan Party;

(i) (i) on the Closing Date the Administrative Agent shall have received from
the Borrower, Holdings, each Subsidiary Loan Party, the New Collateral Agent,
the Administrative Agent and the Revolving Credit Facility Administrative Agent,
a counterpart of the Collateral Agency Agreement duly executed and delivered on
behalf of the Borrower, Holdings, each Subsidiary Loan Party, the New Collateral
Agent, the Administrative Agent and the Revolving Credit Facility Administrative
Agent and such Collateral Agency Agreement shall be in full force and effect and
legal, valid and binding against each of the Loan Parties, the New Collateral
Agent, the Administrative Agent and the Revolving Credit Facility Administrative
Agent as of the Closing Date and (ii) on the Release Date, the Administrative
Agent shall have received from the Borrower, Holdings, each Subsidiary Loan
Party and the New Collateral Agent, a counterpart of the Collateral Agreement
duly executed and delivered on behalf of such Loan Party and the New

 

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Collateral Agent and such Collateral Agreement shall be in full force and effect
and shall be a legal, valid and binding obligation of each such Loan Party and
the New Collateral Agent as of the Release Date;

(j) on or promptly after the Release Date, (I) all the outstanding Equity
Interests of any Person that is or becomes a Subsidiary Loan Party on or after
the Closing Date and (II) all the Equity Interests that are owned by a Loan
Party (other than XM Investment LLC and XM 1500 Eckington LLC) shall have been
pledged pursuant to the Collateral Agreement (or, in the case of Foreign
Subsidiaries, at the request of the New Collateral Agent or the Administrative
Agent, pursuant to a Foreign Pledge Agreement) (provided that (x) the Equity
Interests in any Foreign Subsidiary shall be pledged unless such pledge would
result in adverse tax consequences to the Borrower, in which case such pledge
shall be limited to 65% of the Voting Stock and 100% of the non-Voting Stock of
such Foreign Subsidiary, (y) minority Equity Interests shall be pledged unless
such pledge would result in a breach or violation of contracts or agreements to
which a Loan Party is party or would trigger rights of first refusal, call
rights or other similar provisions thereunder or result in the loss of director
appointment rights or other penalty or loss of rights under such contracts or
agreements and (z) from and after the Holdings Covenant and Collateral Release
Date, Holdings shall be required to pledge only those Equity Interests that
constitute Holdings Collateral) and the New Collateral Agent shall have received
all certificates or other instruments (if any) representing such Equity
Interests, together with stock powers or other instruments of transfer with
respect thereto duly endorsed in blank;

(k) on the Closing Date (in the case of the Existing Collateral Documents) and
on or promptly after the Release Date (in the case of the Collateral Agreement)
and at any time thereafter that any other Security Document shall be executed
and delivered (in the case of any other Security Document), except as set forth
pursuant to Section 3.15 or as otherwise contemplated by the applicable Security
Document, all documents and instruments, including Uniform Commercial Code
financing statements, required by law or reasonably requested by the New
Collateral Agent or the Administrative Agent to be filed, registered, recorded,
executed or possessed to create the Liens intended to be created by the
applicable Security Documents in favor of (i) prior to the Release Date, the
Collateral Agent, for the benefit of the Existing Secured Parties and the New
Secured Parties and (ii) after the Release Date, the New Collateral Agent, for
the benefit of the New Secured Parties and the Revolving Credit Facility Secured
Parties, and to perfect such Liens to the extent required by, and with the
priority required by, the applicable Security Documents and this Agreement,
shall have been filed, registered, recorded (or delivered to the New Collateral
Agent for filing, registration or recording) or executed and delivered; and

(l) except as set forth pursuant to Section 3.03 or as otherwise contemplated by
any Security Document, each Loan Party shall have obtained all consents and
approvals required to be obtained by it in connection with (i) the execution and
delivery of all Security Documents (or supplements thereto) to which it is a
party and the granting by it of the Liens thereunder and (ii) the performance of
its obligations thereunder.

 

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“Commitment” means, with respect to each Lender, the commitment of such Lender
to make a Loan hereunder on the Closing Date in the amount of such Lender’s
Commitment as set forth on Schedule 2.01 under the caption “Commitment”, or in
the Assignment and Assumption pursuant to which such Lender shall have assumed
its Commitment, as applicable, on or prior to the Closing Date. The aggregate
amount of the Lenders’ Commitments is $100,000,000.

“Consent Period” means the period commencing on the date that is three Business
Days following the Closing Date and ending on the Date that is twenty Business
Days following the Closing Date.

“Consolidated Net Income” means, with respect to any specified Person for any
period, the aggregate of the Net Income of such Person and its Material
Subsidiaries for such period, on a consolidated basis, determined in accordance
with GAAP; provided that:

(m) the Net Income (but not loss) of any Person that is not a Material
Subsidiary or that is accounted for by the equity method of accounting shall be
included only to the extent of the amount of dividends or distributions paid in
cash to the specified Person or a Wholly Owned Subsidiary Guarantor thereof;

(n) the Net Income of any Material Subsidiary shall be excluded to the extent
that the declaration or payment of dividends or similar distributions by that
Material Subsidiary of that Net Income is not at the date of determination
permitted without any prior governmental approval (that has not been obtained)
or, directly or indirectly, by operation of the terms of its charter or any
agreement, instrument, judgment, decree, order, statute, rule or governmental
regulation applicable to that Material Subsidiary or its stockholders;

(o) the Net Income of any Person acquired in a pooling of interests transaction
for any period prior to the date of such acquisition shall be excluded; and

(p) the cumulative effect of a change in accounting principles shall be
excluded.

“Consolidated Net Worth” means, with respect to any specified Person as of any
date, the sum of:

(q) the consolidated equity of the common stockholders of such Person and its
consolidated Material Subsidiaries as of such date; plus

(r) the respective amounts reported on such Person’s balance sheet as of such
date with respect to any series of preferred stock (other than Disqualified
Stock) that by its terms is not entitled to the payment of dividends unless such
dividends may be declared and paid only out of net earnings in respect of the
year of such declaration and payment, but only to the extent of any cash
received by such Person upon issuance of such preferred stock.

 

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“Consolidated Total Debt” means, as at any date of determination, an amount
equal to the aggregate amount of all outstanding Indebtedness of Holdings and
its Subsidiaries determined on a consolidated basis in accordance with GAAP.

“Consolidated Total Senior Debt” means, as at any date of determination,
Consolidated Total Debt, less any Indebtedness subordinated in right of payment
and interest to any other Indebtedness of Holdings and its Subsidiaries in
accordance with the terms of this Agreement.

“Continuing Directors” means, as of any date of determination, any member of the
Board of Directors of the Borrower or Holdings who (a) was a member of such
Board of Directors on the Revolving Credit Facility Closing Date; or (b) was
nominated for election or elected to such Board of Directors with the approval
of a majority of the Continuing Directors who were members of such board at the
time of such nomination or election.

“Credit Agreement Obligations” means the unpaid principal of and interest on
(including interest accruing after the maturity of the Loans and interest
accruing after the filing of any petition in bankruptcy, or the commencement of
any insolvency, reorganization or like proceeding, relating to the Borrower,
whether or not a claim for post-filing or post-petition interest is allowed in
such proceeding) the Loans and all other obligations and liabilities of the
Borrower to the Administrative Agent or to any Lender, whether direct or
indirect, absolute or contingent, due or to become due, or now existing or
hereafter incurred, which may arise under, out of, or in connection with, this
Agreement, any other Loan Document, or any other document made, delivered or
given in connection herewith or therewith, whether on account of principal,
interest, reimbursement obligations, fees, indemnities, costs, expenses
(including all fees, charges and disbursements of counsel to the Administrative
Agent or to any Lender that are required to be paid by the Borrower pursuant
hereto) or otherwise.

“Default” means any event or condition which constitutes an Event of Default or
which upon notice, lapse of time or both would, unless cured or waived, become
an Event of Default.

“Deferred Purchase Price Agreements” means each purchase agreement between the
Borrower and a satellite manufacturer for the manufacture of a satellite, the
terms of which provide for a portion of the purchase price to be deferred and
paid by the Borrower other than when specified milestones are achieved or in
installments on or prior to the delivery of such satellite.

“Disqualified Stock” means any Equity Interest that, by its terms (or by the
terms of any security into which it is convertible, or for which it is
exchangeable, in each case at the option of the holder thereof), or upon the
happening of any event, matures or is mandatorily redeemable, pursuant to a
sinking fund obligation or otherwise, or redeemable at the option of the holder
thereof, in whole or in part, on or prior to the date that is 91 days after the
Maturity Date. Notwithstanding the preceding sentence, any Equity Interest that
would constitute Disqualified Stock solely because the holders thereof have the
right to require the Borrower to repurchase such Equity Interests upon the
occurrence of a change of control or an asset sale shall not constitute
Disqualified Stock if the terms of such Equity Interests provide that the
Borrower may not repurchase or redeem any such Equity Interests pursuant to such
provisions unless such repurchase or redemption complies with Section 6.06.

 

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“Distribution and Credit Agreement” means the Third Amended and Restated
Distribution and Credit Agreement dated on or about February 6, 2008 by and
among GM, Holdings and the Borrower, as amended, supplemented or otherwise
modified from time to time, which shall not have principal amounts outstanding
thereunder that exceed $150,000,000 in the aggregate at any time outstanding,
provided that the Distribution and Credit Agreement shall at all times be on
terms and conditions not materially less favorable to the Borrower and its
Subsidiaries, taken as a whole, than the terms and conditions of the GM Credit
Agreement dated as of January 28, 2003 among the Borrower, Holdings, GM and the
other parties named therein, as amended, restated, supplemented or otherwise
modified from time to time, as in effect on the Revolving Facility Closing Date.

“dollars” or “$” refers to lawful money of the United States of America.

“Effective Date” means the date immediately prior to the Merger Effective Time.

“Environmental Laws” means all laws, rules, regulations, codes, ordinances,
orders, decrees, judgments, common law, injunctions, notices or binding
agreements issued, promulgated or entered into by or on behalf of any
Governmental Authority, relating in any way to the environment, preservation or
reclamation of natural resources, the management, release or threatened release
of any Hazardous Material or to health and safety matters.

“Environmental Liability” means any liability, contingent or otherwise
(including any liability for damages, costs of environmental remediation, fines,
penalties or indemnities), of the Borrower or any Subsidiary directly or
indirectly resulting from or based upon (a) violation of, or non-compliance
with, any Environmental Law, (b) the generation, use, handling, transportation,
storage, treatment or disposal of any Hazardous Materials, (c) exposure to any
Hazardous Materials, (d) the release or threatened release of any Hazardous
Materials or (e) any contract, agreement or other consensual arrangement
pursuant to which liability is assumed or imposed with respect to any of the
foregoing.

“Equally and Ratably” has the meaning assigned to such term in the Collateral
Agency Agreement.

“Equity Interests” means shares of capital stock, partnership interests,
membership interests in a limited liability company, beneficial interests in a
trust or other equity ownership interests in a Person, any other interest or
participation that confers on a Person the right to receive a share of the
profits and losses of, or distributions of assets of, the issuing Person, and
any warrants, options or other rights entitling the holder thereof to purchase
or acquire any such equity interest.

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended
from time to time.

“ERISA Affiliate” means any trade or business (whether or not incorporated)
that, together with the Borrower, is treated as a single employer under
Section 414(b) or (c) of the Code or, solely for purposes of Section 302 of
ERISA and Section 412 of the Code, is treated as a single employer under
Section 414 of the Code.

 

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“ERISA Event” means (a) any “reportable event”, as defined in Section 4043 of
ERISA or the regulations issued thereunder with respect to a Plan (other than an
event for which the 30-day notice period is waived); (b) the existence with
respect to any Plan of an “accumulated funding deficiency” (as defined in
Section 412 of the Code or Section 302 of ERISA), whether or not waived; (c) the
filing pursuant to Section 412(d) of the Code or Section 303(d) of ERISA of an
application for a waiver of the minimum funding standard with respect to any
Plan; (d) the incurrence by the Borrower or any ERISA Affiliate of any liability
under Title IV of ERISA with respect to the termination of any Plan; (e) the
receipt by the Borrower or any ERISA Affiliate from the PBGC or a plan
administrator of any notice relating to an intention to terminate any Plan or
Plans or to appoint a trustee to administer any Plan; (f) the failure of the
Borrower or any ERISA Affiliate to make any required contribution under any
Multiemployer Plan; (g) the incurrence by the Borrower or any ERISA Affiliate of
any liability with respect to the withdrawal or partial withdrawal from any Plan
or Multiemployer Plan; (h) the receipt by the Borrower or any ERISA Affiliate of
any notice, or the receipt by any Multiemployer Plan from the Borrower or any
ERISA Affiliate of any notice, concerning the imposition of Withdrawal Liability
or a determination that a Multiemployer Plan is, or is expected to be, insolvent
or in reorganization, within the meaning of Title IV of ERISA; (i) the
occurrence of an act or omission which could give rise to the imposition of
fines, penalties, taxes or related charges under Chapter 43 of the Code or under
Section 409, Section 502(c), (i) or (k) or Section 4071 of ERISA in respect of
any Plan; (j) the imposition of a Lien pursuant to Section 401(a)(29) or 412(n)
of the Code with respect to any Plan; or (k) the occurrence of any event with
respect to any Plan similar to the events described in any of the subsections
(a) through (j) hereof which would cause liability to arise to the Borrower or
any ERISA Affiliate.

“Eurodollar”, when used in reference to any Loan, indicates that such Loan is
bearing interest at a rate determined by reference to the Adjusted LIBO Rate.

“Event of Default” has the meaning assigned to such term in Article VII.

“Excess Proceeds” means any Net Proceeds from any Asset Sale that are not
finally applied or invested in accordance with the Borrower’s Reinvestment
Right.

“Exchange Act” means the Securities Exchange Act of 1934, as amended.

“Excluded Entities” means, collectively, (a) any Subsidiary of Holdings (other
than the Borrower or a Subsidiary of the Borrower) that has as its principal
asset real estate that is leased to Holdings or the Borrower, including XM 1500
Eckington LLC and XM Investment LLC, (b) companies that are not Subsidiaries of
Holdings, the Borrower or a Subsidiary of the Borrower, including WorldSpace,
Inc. and Canadian Satellite Radio Holdings Inc., (c) WCS Wireless Inc. (as long
as it is not a Subsidiary of the Borrower) and (d) any Subsidiary of Holdings
(other than the Borrower or a Subsidiary of the Borrower) formed to hold and
operate the assets of WCS Wireless Inc.

“Excluded Taxes” means, with respect to the Administrative Agent, any Lender or
any other recipient of any payment to be made by or on account of any obligation
of the Borrower hereunder, (a) taxes imposed on (or measured by) its net income,
including franchise taxes imposed in lieu of net income taxes, by the United
States of America, or by the jurisdiction under

 

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the laws of which such recipient is organized or in which its principal office
is located or, in the case of any Lender, in which its applicable lending office
is located, (b) any branch profits taxes imposed by the United States of America
or any similar tax imposed by any other jurisdiction in which the Borrower is
located and (c) in the case of a Foreign Lender (other than an assignee pursuant
to a request by the Borrower under Section 2.18(b)), any withholding tax that is
imposed on amounts payable to such Foreign Lender at the time such Foreign
Lender becomes a party to this Agreement (or designates a new lending office) or
is attributable to such Foreign Lender’s failure to comply with Section 2.16(e),
except to the extent that such Foreign Lender (or its assignor, if any) was
entitled, at the time of designation of a new lending office (or assignment), to
receive additional amounts from the Borrower with respect to such withholding
tax pursuant to Section 2.16(a).

“Existing 10% Notes” has the meaning assigned to such term in clause (b) of the
definition of “January 2003 Financing Transactions”.

“Existing 10% Notes Change of Control Offer” means a Change of Control Offer (as
defined in the Noteholders Agreement) with respect to the Existing 10% Notes
made by the Borrower in connection with the Merger and/or any Merger Related
Event pursuant to the terms of Section 8.7 of the Noteholders Agreement.

“Existing 10% Notes Extension” means each extension, in accordance with the
terms of the Note Purchase Agreement, of the date on which the Borrower is
required to make a Change of Control Offer (as defined in the Noteholders
Agreement) with respect to all of the Existing 10% Notes as a result of any
Change of Control (under and as defined in the Note Purchase Agreement) that
occurs or will occur in connection with the Merger and/or any Merger Related
Event.

“Existing 10% Notes Waiver” means a waiver, in accordance with the terms of the
Note Purchase Agreement, of any Change of Control (under and as defined in the
Note Purchase Agreement) with respect to all of the Existing 10% Notes that
occurs or will occur in connection with the Merger and/or any Merger Related
Event and the consequences of such Change of Control (including the requirement
that the Borrower make a Change of Control Offer (as defined in the Noteholders
Agreement)).

“Existing Collateral” means the “Collateral” under and as defined in (a) the
Existing General Security Agreement and (b) the Existing FCC License Subsidiary
Pledge Agreement.

“Existing Collateral Documents” means, collectively, (a) the Existing
Intercreditor Agreements, (b) the Existing General Security Agreement and
(c) the Existing FCC License Subsidiary Pledge Agreement.

“Existing FCC License Subsidiary Pledge Agreement” means the Amended and
Restated FCC License Subsidiary Pledge Agreement, dated as of January 28, 2003,
among the Borrower, as pledgor, and The Bank of New York, as Collateral Agent,
as may be amended, restated, supplemented or otherwise modified from time to
time.

“Existing General Security Agreement” means the Security Agreement, dated as of
January 28, 2003, among the Borrower, Holdings and XM Equipment Leasing LLC, as
grantors, and The Bank of New York, as Collateral Agent, as may be amended,
restated, supplemented or otherwise modified from time to time.

 

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“Existing Holdings Indebtedness” means the Obligations of Holdings in respect of
the Existing 10% Notes.

“Existing Indebtedness” means Indebtedness of the Borrower and its Material
Subsidiaries in existence on the Revolving Credit Facility Closing Date,
including the Indebtedness incurred or to be incurred pursuant to the January
2003 Financing Transactions, in each case until such amounts are repaid or, in
the case of Indebtedness incurred under a facility that permits repayment and
reborrowing, until the commitment(s) for such facility have terminated or are
released.

“Existing Intercreditor Agreements” means, collectively, (a) the Intercreditor
and Collateral Agency Agreement (FCC License Subsidiary Pledge Agreement), dated
as of January 28, 2003, among the Noteholders named in schedule I thereto, The
Bank of New York, as Original Trustee, The Bank of New York, as New Trustee, GM,
The Bank of New York, as Collateral Agent and the Additional Creditors from time
to time party thereto and (b) the Intercreditor and Collateral Agency Agreement
(General Security Agreement), dated as of January 28, 2003, among the
Noteholders named in schedule I thereto, The Bank of New York, as New Trustee,
GM, The Bank of New York, as Collateral Agent and the Additional Creditors from
time to time party thereto, in each case, as may be amended, restated,
supplemented or otherwise modified from time to time.

“Existing Secured Parties” means the holders of the Existing 10% Notes, the
Revolving Credit Facility Secured Parties and any other Person identified as a
secured party under the Existing Collateral Documents other than any Additional
Creditors (as defined in the Existing Intercreditor Agreements) that were not
parties thereto immediately prior to the date hereof.

“Existing Security Interest” means the security interest of the Collateral Agent
for the benefit of the holders of the Existing 10% Notes, the Revolving Credit
Facility Secured Parties and each Additional Creditor (as defined in the
Existing Intercreditor Agreements) in the Existing Collateral pursuant to the
terms of the Existing Collateral Documents.

“Expiration Date” means the first date on which any or all of the following
shall have occurred: (a) a New Senior Notes Change of Control Offer Payment
Date, (b) an Owner Trustee Notes Repurchase Date, (c) a Beneficial Interest
Purchase Date, or (d) an XM-4 Sale and Leaseback Repurchase Date.

“FCC License Subsidiary” means XM Radio Inc., a wholly owned subsidiary of the
Borrower that holds all of the FCC licenses with respect to the provision of
satellite digital radio service in the United States by the Borrower or any of
its Subsidiaries.

“Federal Funds Effective Rate” means, for any day, the weighted average (rounded
upwards, if necessary, to the next 1/100 of 1%) of the rates on overnight
Federal funds transactions with members of the Federal Reserve System arranged
by Federal funds brokers, as published on the next succeeding Business Day by
the Federal Reserve Bank of New York, or, if such rate is not so published for
any day that is a Business Day, the average (rounded upwards, if

 

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necessary, to the next 1/100 of 1%) of the quotations for such day for such
transactions received by the Administrative Agent from three Federal funds
brokers of recognized standing selected by it.

“Fee Letter” has the meaning assigned to such term in Section 2.11.

“Financial Officer” means the chief financial officer, principal accounting
officer, treasurer or controller of the Borrower.

“Foreign Lender” means any Lender that is organized under the laws of a
jurisdiction other than the United States of America, any State thereof or the
District of Columbia.

“Foreign Pledge Agreement” means a pledge agreement with respect to the Equity
Interests of a Foreign Subsidiary, in form and substance reasonably satisfactory
to the Administrative Agent.

“Foreign Subsidiary” means any Subsidiary that is organized under the laws of a
jurisdiction other than that in which the Borrower is located. For purposes of
this definition, the United States of America, each State thereof and the
District of Columbia shall be deemed to constitute a single jurisdiction.

“GAAP” means generally accepted accounting principles set forth in the opinions
and pronouncements of the Accounting Principles Board of the American Institute
of Certified Public Accountants and statements and pronouncements of the
Financial Accounting Standards Board or in such other statements by such other
entity as have been approved by a significant segment of the accounting
profession, which are in effect from time to time.

“GM” means General Motors Corporation or one or more of its wholly-owned
subsidiaries.

“GM Liens” means the second priority Liens granted by the Loan Parties on all or
any portion of the Collateral in support of the Borrower’s and Holdings’
Obligations in respect of the Distribution and Credit Agreement, which Liens
shall be subordinated to the Liens securing the Borrower Obligations pursuant to
the Second Lien Intercreditor Agreement.

“GM Second Lien Collateral Document” means any document made, delivered or given
after the date hereof by any of the Loan Parties in favor of GM in connection
with the GM Liens.

“Governmental Authority” means the government of the United States of America,
any other nation or any political subdivision thereof, whether state or local,
and any agency, authority, instrumentality, regulatory body, court, central bank
or other entity exercising executive, legislative, judicial, taxing, regulatory
or administrative powers or functions of or pertaining to government.

“Guarantee” of or by any Person (the “guarantor”) means any obligation,
contingent or otherwise, of the guarantor guaranteeing or having the economic
effect of guaranteeing any Indebtedness or other obligation of any other Person
(the “primary obligor”) in any manner, whether directly or indirectly, and
including any obligation of the guarantor, direct or indirect,

 

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(a) to purchase or pay (or advance or supply funds for the purchase or payment
of) such Indebtedness or other obligation or to purchase (or to advance or
supply funds for the purchase of) any security for the payment thereof, (b) to
purchase or lease property, securities or services for the purpose of assuring
the owner of such Indebtedness or other obligation of the payment thereof,
(c) to maintain working capital, equity capital or any other financial statement
condition or liquidity of the primary obligor so as to enable the primary
obligor to pay such Indebtedness or other obligation or (d) as an account party
in respect of any letter of credit or letter of guaranty issued to support such
Indebtedness or obligation; provided, that the term Guarantee shall not include
endorsements for collection or deposit in the ordinary course of business.

“Guarantee Agreement” means the Guarantee Agreement, dated as of the Closing
Date, as amended, supplemented or otherwise modified from time to time, in the
form of Exhibit C, among Holdings, each Subsidiary Loan Party and the
Administrative Agent.

“Guarantor Obligations” means with respect to any Guarantor, all obligations and
liabilities of such Guarantor which may arise under or in connection with the
Guarantee Agreement (including, without limitation, Section 2 thereof) or any
other Loan Document to which such Guarantor is a party, in each case whether on
account of guarantee obligations, reimbursement obligations, fees, indemnities,
costs, expenses or otherwise (including, without limitation, all fees and
disbursements of counsel to any Secured Party that are required to be paid by
such Guarantor pursuant to the terms of any Loan Document).

“Guarantors” means, collectively, (a) Holdings and (b) each Subsidiary Loan
Party.

“Hazardous Materials” means all explosive or radioactive materials, substances
or wastes and all hazardous or toxic materials, substances, wastes or other
pollutants, including petroleum or petroleum distillates, asbestos or asbestos
containing materials, polychlorinated biphenyls, radon, infectious or medical
wastes and all other materials, substances or wastes of any nature regulated
pursuant to any Environmental Law.

“Hedging Obligations” means, with respect to any specified Person, the
obligations of such Person under (a) interest rate Swap Agreements; and
(b) other agreements or arrangements designed to protect such Person against
fluctuations in interest rates or currency values.

“Holdings” means XM Satellite Radio Holdings Inc., a Delaware corporation.

“Holdings Collateral” has the meaning assigned to such term in the Collateral
Agreement.

“Holdings Collateral Transfer” has the meaning assigned to such term in
Section 9.05.

“Holdings Covenant and Collateral Release Date” has the meaning assigned to such
term in Section 9.05.

“Holdings Covenant and Collateral Release Notice” has the meaning assigned to
such term in Section 9.05.

 

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“Holdings Satellite Vendor Indebtedness” means Indebtedness of Holdings to a
satellite or satellite launch vendor or Affiliate thereof consisting of or
otherwise financing the deferral of payments required to be made by Holdings to
the vendor in respect of the construction, launch and/or insurance of all or
part of the XM-5 Satellite but not beyond the date on which either Holdings or
the Borrower shall have legal title to the XM-5 Satellite or the date the XM-5
satellite launches, as applicable.

“Immaterial Subsidiary” means each Subsidiary of the Borrower that is not a
Material Subsidiary.

“Indebtedness” means, with respect to any specified Person, any indebtedness of
such Person, whether or not contingent, (a) in respect of borrowed money;
(b) evidenced by bonds, notes, debentures or similar instruments or letters of
credit (or reimbursement agreements in respect thereof); (c) in respect of
banker’s acceptances; (d) representing Capital Lease Obligations; (e) consisting
of the balance deferred and unpaid of the purchase price of any property; except
any such balance that constitutes an accrued expense or trade payable; or
(f) representing any Hedging Obligations, if and to the extent any of the
preceding items (other than letters of credit and Hedging Obligations) would
appear as a liability upon a balance sheet of the specific Person prepared in
accordance with GAAP. In addition, the term “Indebtedness” shall include (i) all
Indebtedness of others secured by a Lien on any asset of the specified Person
(whether or not such Indebtedness is assumed by the specified Person), (ii) to
the extent not otherwise included, the Guarantee by the specified Person of any
Indebtedness of any other Person and (iii) all Attributable Debt of such Person.

The amount of any Indebtedness outstanding as of any date shall be:

(1) the accreted value thereof, in the case of any Indebtedness issued with
original issue discount;

(2) the face amount thereof, in the case of letters of credit, banker’s
acceptances and similar obligations;

(3) the net obligations of such Person in respect thereof, in the case of
Hedging Obligations;

(4) the present value of the obligation of the lessee for net rental payments,
in the case of Attributable Debt, as set forth in the definition thereof; and

(5) the principal amount thereof, together with any interest thereon that is
more than 30 days past due, in the case of any other Indebtedness.

“Indemnified Taxes” means Taxes other than Excluded Taxes.

“Indivisible Ancillary XM-4 Satellite Collateral” means any assets, licenses
and/or usage rights associated specifically with the XM-4 Satellite to the
extent not constituting (or the portion thereof that is not) Ancillary XM-4
Satellite Collateral because not divisible or separately conveyable.

 

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“Intellectual Property” means the collective reference to all rights, priorities
and privileges relating to intellectual property, whether arising under United
States, state, multinational or foreign laws or otherwise, including (a) all
inventions (whether patentable or unpatentable and whether or not reduced to
practice), all improvements thereto, and all patents, patent applications, and
patent disclosures, together with all provisionals, reissuances, continuations,
continuations-in-part, divisions, revisions, extensions, and reexaminations
thereof, (b) all trademarks, service marks, trade dress, logos, brand names,
trade names, domain names and corporate names, together with all translations,
adaptations, derivations, and combinations thereof and including all goodwill
associated therewith, and all applications, registrations and renewals in
connection therewith, (c) all copyrightable works and protectable designs, all
copyrights, and all applications, registrations, and renewals in connection
therewith, (d) all mask works and all applications, registrations, and renewals
in connection therewith, (e) all trade secrets and confidential business
information (including ideas, research and development, know-how, formulas,
compositions, manufacturing and production processes and techniques, technical
data, drawings, designs, specifications, research records, records of
inventions, test information, customer and supplier lists, pricing and cost
information, and business and marketing plans and proposals), (f) any rights in
or licenses to or from a third party in any of the foregoing, and (g) any past,
present, or future claims or causes of actions arising out of or related to any
infringement, misappropriation, dilution or other violation of any of the
foregoing, including the right to receive all proceeds and damages therefrom.

“Interest Election Request” means a request by the Borrower to convert or
continue a Loan in accordance with Section 2.07.

“Interest Payment Date” means (a) with respect to any ABR Loan, the last day of
each March, June, September and December, and (b) with respect to any Eurodollar
Loan, the last day of the Interest Period applicable to such Eurodollar Loan
and, in the case of a Eurodollar Loan with an Interest Period of more than three
months’ duration, each day prior to the last day of such Interest Period that
occurs at intervals of three months’ duration after the first day of such
Interest Period.

“Interest Period” means, with respect to any Eurodollar Loan, the period
commencing on the date of such Eurodollar Loan and ending on the numerically
corresponding day in the calendar month that is one, two, three or six months
(or, with the consent of each Lender, nine months) thereafter, as the Borrower
may elect; provided, that (i) if any Interest Period would end on a day other
than a Business Day, such Interest Period shall be extended to the next
succeeding Business Day unless, in the case of a Eurodollar Loan only, such next
succeeding Business Day would fall in the next calendar month, in which case
such Interest Period shall end on the next preceding Business Day and (ii) any
Interest Period pertaining to a Eurodollar Loan that commences on the last
Business Day of a calendar month (or on a day for which there is no numerically
corresponding day in the last calendar month of such Interest Period) shall end
on the last Business Day of the last calendar month of such Interest Period. For
purposes hereof, the date of a Eurodollar Loan initially shall be the date on
which such Eurodollar Loan is made or converted from an ABR Loan or continued as
a Eurodollar Loan.

“Investments” means, with respect to any Person, all direct or indirect
investments by such Person in other Persons (including Affiliates) in the form
of loans (including Guarantees or

 

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other obligations), advances or capital contributions (excluding commission,
travel and similar advances to officers, directors and employees made in the
ordinary course of business), purchases or other acquisitions for consideration
of Indebtedness, Equity Interests or other securities, together with all items
that are or would be classified as investments on a balance sheet prepared in
accordance with GAAP. If the Borrower or any Material Subsidiary of the Borrower
sells or otherwise disposes of any Equity Interests of any direct or indirect
Material Subsidiary of the Borrower such that, after giving effect to any such
sale or disposition, such Person is no longer a Material Subsidiary of the
Borrower, the Borrower shall be deemed to have made an Investment on the date of
any such sale or disposition equal to the fair market value of the Equity
Interests of such Subsidiary not sold or disposed of in an amount determined as
provided under Section 6.06(c). The acquisition by the Borrower or any Material
Subsidiary of the Borrower of a Person that holds an Investment in a third
Person shall be deemed to be an Investment by the Borrower or such Material
Subsidiary in such third Person in an amount equal to the fair market value of
the Investment held by the acquired Person in such third Person determined as
provided in Section 6.06(c).

“January 2003 Financing Transactions” means (a) the amendment and restatement of
the Distribution Agreement dated as of January 28, 2003 to provide for the
payment of up to $35,000,000 in subscriber acquisition payments in the form of
Class A Common Stock of Holdings (the “Class A Common Stock”), (b) the issuance
of the Borrower’s and Holdings’ 10% Senior Secured Convertible Discount Notes
due 2009 and common stock to certain investors (the “Existing 10% Notes”)
pursuant to the Note Purchase Agreement, (c) borrowings of up to $150,000,000 at
any time outstanding under the Distribution and Credit Agreement to finance
certain revenue share payments owed to GM under the Distribution and Credit
Agreement or other amounts which may be owing from time to time to GM, (d) the
execution, delivery and performance of all agreements, documents and instruments
evidencing the transactions described in clauses (a) through (c) above and all
arrangements contemplated thereby, in each case as reflected in such agreements,
documents and instruments as in effect on the Revolving Credit Facility Closing
Date with such amendments that do not (x) have a materially adverse effect on
the rights of the Administrative Agent or the Lenders or the Loan Parties or
(y) increase the principal amount (or accreted value, as applicable) or shorten
the fixed maturity of any Indebtedness.

“Lenders” means the Persons listed on Schedule 2.01 and any other Person that
shall have become a party hereto pursuant to an Assignment and Assumption, other
than any such Person that ceases to be a party hereto pursuant to an Assignment
and Assumption.

“LIBO Rate” means, with respect to any Eurodollar Loan for any Interest Period,
the rate appearing on Page 3750 of the Dow Jones Market Service (or on any
successor or substitute page of such Service, or any successor to or substitute
for such Service, providing rate quotations comparable to those currently
provided on such page of such Service, as determined by the Administrative Agent
from time to time for purposes of providing quotations of interest rates
applicable to dollar deposits in the London interbank market) at approximately
11:00 a.m., London time, two Business Days prior to the commencement of such
Interest Period, as the rate for dollar deposits with a maturity comparable to
such Interest Period. In the event that such rate is not available at such time
for any reason, then the “LIBO Rate” with respect to such Eurodollar Loan for
such Interest Period shall be the rate at which dollar deposits of $5,000,000

 

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and for a maturity comparable to such Interest Period are offered by the
principal London office of the Administrative Agent in immediately available
funds in the London interbank market at approximately 11:00 a.m., London time,
two Business Days prior to the commencement of such Interest Period.

“Lien” means, with respect to any asset, (a) any mortgage, deed of trust, lien,
pledge, hypothecation, encumbrance, charge or security interest in, on or of
such asset and (b) the interest of a vendor or a lessor under any conditional
sale agreement, capital lease or title retention agreement (or any financing
lease having substantially the same economic effect as any of the foregoing)
relating to such asset.

“Loan Documents” means this Agreement, the Security Documents, and any
promissory note issued under Section 2.09(c).

“Loan Parties” means the Borrower, Holdings and the Subsidiary Loan Parties.

“Loans” means the loans made by the Lenders to the Borrower pursuant to
Section 2.01.

“Margin Regulations” means Regulations T, U and X of the Board.

“Margin Stock” shall have the meaning assigned to such term in Regulation U.

“Material Adverse Effect” means a material adverse effect on (a) the business,
assets, operations or financial condition of the Borrower and the Subsidiaries
taken as a whole, (b) the ability of the Loan Parties to perform any of their
respective obligations under this Agreement or the other Loan Documents or
(c) the validity or enforceability of any of the Loan Documents or the rights or
remedies of the Administrative Agent and the Lenders thereunder.

“Material Indebtedness” means Indebtedness (other than the Loans), or
obligations in respect of one or more Swap Agreements, of any one or more of
Holdings, the Borrower and its Subsidiaries in an aggregate principal amount
exceeding $25,000,000. For purposes of determining Material Indebtedness, the
“principal amount” of the obligations of Holdings, the Borrower or any such
Subsidiary in respect of any Swap Agreement at any time shall be the maximum
aggregate amount (giving effect to any netting agreements) that Holdings, the
Borrower or such Subsidiary would be required to pay if such Swap Agreement were
terminated at such time.

“Material Subsidiary” means each Subsidiary of the Borrower having assets (on a
consolidated basis including its Subsidiaries) with a value in excess of 2% of
the total assets or 2% of total revenues of the Borrower and its Subsidiaries
taken as a whole as of any date; provided that (i) in no event may the assets or
revenues of all Immaterial Subsidiaries have a value in excess of 10% of the
total assets or 10% of the total revenues of the Borrower and its Subsidiaries
taken as a whole as of any date (and, in such case, Subsidiaries specified by
the Borrower (and if the Borrower fails to so specify, specified by the
Administrative Agent) shall be deemed to be Material Subsidiaries
notwithstanding the foregoing to the extent necessary to satisfy this proviso)
and (ii) to the extent permitted by applicable law, rules or regulations,
including rules and regulations of the Federal Communications Commission, the
FCC License Subsidiary shall at all times be a Material Subsidiary.

 

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“Maturity Date” means May 5, 2009.

“Merger” means the combination of the businesses of Holdings and SIRIUS through
a merger of Holdings and a newly formed, wholly owned subsidiary of SIRIUS, on
the terms and conditions set forth in the Merger Agreement.

“Merger Agreement” means that certain Agreement and Plan of Merger between
Holdings and SIRIUS, dated as of February 19, 2007 and filed by Holdings with
the SEC on February 21, 2007 as Exhibit 2.1 to the Form 8-K filed on such date,
together with any amendments, supplements or modifications thereto that would
not have an adverse effect on the interests of the Lenders.

“Merger Effective Time” means the time in which the Merger becomes effective in
accordance with the terms and conditions of the Merger Agreement.

“Merger Related Event” means any event or condition directly related to, and
that occurs or will occur as a result of, the Merger (including, without
limitation, changes in the composition of the Board of Directors of the Borrower
and/or Holdings) that would constitute a “Change of Control” under and as
defined in each of the Senior Notes Indentures, the Note Purchase Agreement
and/or the Participation Agreement.

“MLB” means Major League Baseball Clubs.

“MLB Contract” means the Letter Agreement and Binding Term Sheet, dated as of
October 15, 2004 (the “MLB Letter Agreement”), between the Borrower and the
Office of the Commissioner of Baseball, as agent for MLB, together with all
agreements subsequently entered into between the Borrower and MLB, or any of
their respective affiliates, regarding the broadcast of Major League Baseball
games and related programming on XM Radio Service, the creation of liens on an
escrow account to hold funds payable to MLB in an amount not to exceed
$120,000,000 or other matters contemplated by the MLB Letter Agreement.

“MLB Intellectual Property” means any intellectual property rights which were to
be the subject of a non-exclusive license under the MLB Contract but which the
Borrower is deemed to own, by operation of law or otherwise, and as to which MLB
would be retaining a security interest (and any products and proceeds thereof)
under the MLB Contract.

“MLB Letter of Credit” means each letter of credit that is issued in connection
with the MLB Contract for the benefit of MLB and/or the other MLB-related
counterparties to the MLB Contract.

“MLB Letter of Credit Cash Collateral” means cash of the Borrower that is
deposited with the issuer of an MLB Letter of Credit while such MLB Letter of
Credit is outstanding to secure the reimbursement obligations of the Borrower
under such MLB Letter of Credit in an aggregate amount for all such MLB Letters
of Credit not to exceed $126,000,000 (plus any interest thereon accrued with
respect to such amount over a period not to exceed three months) at any time.

“Moody’s” means Moody’s Investors Service, Inc.

 

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“Multiemployer Plan” means a multiemployer plan as defined in Section 4001(a)(3)
of ERISA.

“Net Income” means, with respect to any specified Person, the net income (loss)
of such Person and its Material Subsidiaries, determined in accordance with GAAP
and before any reduction in respect of preferred stock dividends, excluding,
however:

(s) any gain or loss, together with any related provision for taxes on such gain
or loss, realized in connection with: (i) any Asset Sale; or (ii) the
disposition of any securities by such Person or any of its Material Subsidiaries
or the extinguishment of any Indebtedness of such Person or any of its Material
Subsidiaries; and

(t) any extraordinary gain or loss, together with any related provision for
taxes on such extraordinary gain or loss.

“Net Proceeds” means the aggregate cash proceeds received by the Borrower or any
of its Material Subsidiaries in respect of any Asset Sale or other transaction
(including, without limitation, any cash received upon the sale or other
disposition of any non-cash consideration received in any Asset Sale), net of
the direct costs relating to such Asset Sale or other transaction, including,
without limitation, legal, accounting and investment banking fees, and sales
commissions, and any relocation expenses incurred as a result thereof, and taxes
paid or payable as a result thereof, in each case, after taking into account any
available tax credits or deductions and any tax sharing arrangements, and
amounts required to be applied to the repayment of Indebtedness (other than the
Credit Agreement Obligations) secured by a Lien on the asset or assets that were
the subject of such Asset Sale or other transaction and any reserve for
adjustment in respect of the sale price of such asset or assets established in
accordance with GAAP.

“New Collateral Agent” means JPMorgan Chase Bank, N.A., in its capacity as
collateral agent under the Collateral Agency Agreement or such other Person then
serving as collateral agent under the Collateral Agency Agreement.

“New Debt Securities” shall have the meaning assigned to such term in
Section 9.04(b).

“New Secured Parties” means the Administrative Agent, each Lender and the
Arranger.

“New Senior Notes” means the Senior Floating Rate Notes and the Senior Fixed
Rate Notes.

“New Senior Notes Change of Control Offers” means each Change of Control Offer
(as defined in the Senior Notes Indentures) with respect to the Senior Notes
made by the Borrower in connection with the Merger and/or any Merger Related
Event pursuant to the terms of Section 4.14 of each Senior Notes Indenture.

“New Senior Notes Change of Control Offers Payment Date” means each “Change of
Control Offer Payment Date” as defined in Section 4.14 of each Senior Notes
Indenture with respect to the Senior Notes and set forth in each New Senior
Notes Change of Control Offer.

 

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“New Senior Notes Extension” means each extension, in accordance with the terms
of the Senior Notes Indentures, of the date on which the Borrower is required to
make a Change of Control Offer (as defined in the Senior Notes Indentures) with
respect to all of the New Senior Notes as a result of any Change of Control
(under and as defined in the Senior Notes Indentures) that occurs or will occur
in connection with the Merger and/or any Merger Related Event.

“New Senior Notes Refinance Date” means any date on which all of the New Senior
Notes have been refinanced (with the proceeds of Permitted Refinancing
Indebtedness or the proceeds from the issuance of Equity Interests of Holdings
(prior to the Merger) or SIRIUS (following the Merger)) in accordance with the
terms of the Senior Notes Indentures and this Agreement.

“New Senior Notes Waiver” means a waiver, in accordance with the terms of the
Senior Notes Indentures, of any Change of Control (under and as defined in the
Senior Notes Indentures) with respect to all of the New Senior Notes that occurs
or will occur in connection with the Merger and/or any Merger Related Event and
the consequences of such Change of Control (including the requirement that the
Borrower make a Change of Control Offer (as defined in the Senior Notes
Indentures)).

“New Senior Notes Waiver Date” means any date on which any New Senior Notes
Waiver shall be effective in accordance with its terms with respect to all of
the New Senior Notes.

“Note Purchase Agreement” means the Note Purchase Agreement dated as of
December 21, 2002, among the Borrower, Holdings and the investors party thereto,
providing for the sale and issuance of the Existing 10% Notes, as may be
amended, restated, supplemented or otherwise modified from time to time.

“Noteholders Agreement” means that certain Third Amended and Restated
Shareholders and Noteholders Agreement, dated as of June 16, 2003, by and among
Holdings and the other parties named on the signature pages thereof, as such
agreement has been or may be amended, modified or supplemented from time to
time.

“Obligations” means any principal, interest, penalties, fees, indemnifications,
reimbursements, damages and other liabilities payable under the documentation
governing any Indebtedness.

“Organizational Documents” means (i) with respect to any corporation, its
certificate or articles of incorporation or organization, as amended, and its by
laws, as amended, (ii) with respect to any limited partnership, its certificate
of limited partnership, as amended, and its partnership agreement, as amended,
(iii) with respect to any general partnership, its partnership agreement, as
amended, and (iv) with respect to any limited liability company, its articles of
organization, as amended, and its operating agreement, as amended. In the event
any term or condition of this Agreement or any other Loan Document requires any
Organizational Document to be certified by a secretary of state or similar
governmental official, the reference to any such “Organizational Document” shall
only be to a document of a type customarily certified by such governmental
official.

 

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“Other Taxes” means any and all present or future stamp or documentary taxes or
any other excise or property taxes, charges or similar levies arising from any
payment made hereunder or from the execution, delivery or enforcement of, or
otherwise with respect to, this Agreement.

“Owner Trustee” has the meaning assigned to such term in the defined term
“Participation Agreement.”

“Owner Trustee Indenture” means that certain Indenture dated as of February 13,
2007, between the Owner Trustee and The Bank of New York, a New York banking
corporation, not in its individual capacity, except as otherwise expressly set
forth therein, but solely as Indenture Trustee under the Indenture, as such
Indenture may be amended, modified or supplemented from time to time.

“Owner Trustee Notes” means the Notes issued by the Owner Trustee pursuant to
the Owner Trustee Indenture.

“Owner Trustee Notes Refinance Date” means any date on which all of the
outstanding Owner Trustee Notes have been refinanced with the proceeds of
Permitted Refinancing Indebtedness (provided that, notwithstanding clause (e) of
the definition of Permitted Refinancing Indebtedness, such Permitted Refinancing
Indebtedness may be incurred by Holdings) or the proceeds from the issuance of
Equity Interests of Holdings (prior to the Merger) or SIRIUS (following the
Merger), in each case pursuant to the terms of the XM-4 Sale and Leaseback Offer
to Purchase or Refinance and in accordance with the terms of the Participation
Agreement and this Agreement.

“Owner Trustee Notes Repurchase Date” means any date on which the Borrower or
Holdings is required to repurchase any or all of the outstanding Owner Trustee
Notes pursuant to the terms of the XM-4 Sale and Leaseback Offer to Purchase or
Refinance and in accordance with the terms of the Participation Agreement and
this Agreement.

“Parent Company Merger” means (a) a merger or consolidation of the Borrower with
or into Holdings or a merger or consolidation of Holdings with or into the
Borrower or (b) any assignment, transfer, conveyance or other disposition of all
or substantially all of the properties or assets of the Borrower to Holdings or
of Holdings to the Borrower.

“Pari Passu Indebtedness” means Indebtedness of the Borrower that is pari passu
in right of payment to the Loans or, in the case of a Subsidiary Loan Party,
that is pari passu in right of payment to the Guarantee of the Loans.

“Participant” has the meaning set forth in Section 9.04.

“Participation Agreement” means that certain Participation Agreement dated as of
February 13, 2007 among Holdings, as Seller, the Borrower, as Lessee, Satellite
Leasing (702–4), LLC, a Delaware limited liability company, as Owner
Participant, Wells Fargo Bank Northwest, National Association, a national
banking association, not in its individual capacity, except as otherwise
expressly set forth therein, but solely in its capacity as Owner Trustee (the
“Owner Trustee”) and as Lessor, The Bank of New York, a New York banking
corporation, as

 

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Indenture Trustee, and the purchasers identified on the signature pages thereto,
as initial purchasers of the Owner Trustee Notes, entered into in connection
with that certain XM-4 Sale and Leaseback Transaction, as such agreement may be
amended, modified or supplemented from time to time.

“PBGC” means the Pension Benefit Guaranty Corporation referred to and defined in
ERISA and any successor entity performing similar functions.

“Perfection Certificate” means a certificate in the form of Exhibit F or any
other form approved by the Administrative Agent.

“Permitted Beneficial Interest Indebtedness” means any Indebtedness of the
Borrower or any of its Material Subsidiaries the net proceeds of which are used
to purchase, refinance or replace the Beneficial Interest; provided that:

(a) the aggregate principal amount (or accreted value, if applicable) of such
Permitted Beneficial Interest Indebtedness does not exceed $85.0 million;

(b) such Permitted Beneficial Interest Indebtedness shall have a final maturity
date later than the final maturity date of the Loans, and shall not require
payment of any or all of the principal amount of such Permitted Beneficial
Interest Indebtedness prior to the final maturity date of the Loans; and

(c) such Permitted Beneficial Interest Indebtedness is either unsecured or is
secured on terms at least as favorable to the Lenders as those contained in the
documentation governing the Beneficial Interest.

“Permitted Business” means (i) with respect to Holdings, any of the lines of
business conducted by Holdings and its Material Subsidiaries as of the Revolving
Credit Facility Closing Date, the provision of communications or media services
using the wireless spectrum licenses of WCS Wireless, any other line of business
involving the transmission or delivery of audio, data, video or other content
through currently existing or future technology, and any business similar,
ancillary or related thereto or that constitutes a reasonable extension or
expansion thereof, including in connection with Holdings’ or its Material
Subsidies’ existing and future technology, trademarks and patents and (ii) with
respect to the Borrower or any of its Subsidiaries, any of the lines of business
conducted by the Borrower and its Material Subsidiaries on the Revolving Credit
Facility Closing Date, and any business similar, ancillary or related thereto or
that constitutes a reasonable extension or expansion thereof, including in
connection with the Borrower’s existing and future technology, trademarks and
patents.

“Permitted Debt” has the meaning assigned to such term in Section 6.01(b).

“Permitted Holdings Debt” means:

(a) Indebtedness incurred by Holdings in connection with the purchase by
Holdings of buildings for use in the satellite radio business, which
Indebtedness may be secured by Liens on such buildings;

 

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(b) Indebtedness incurred by Holdings in connection with an XM-4 Sale and
Leaseback Transaction, which Indebtedness may be secured by the XM-4 Satellite
Collateral;

(c) Indebtedness (other than Credit Agreement Obligations and Revolving Credit
Facility Obligations) secured by Liens on the assets of Holdings (other than any
Holdings Collateral) in an aggregate principal amount not to exceed $50,000,000;

(d) Holdings Satellite Vendor Indebtedness or guarantees by Holdings of
Satellite Vendor Indebtedness in respect of the XM-5 Satellite; and

(e) Existing Holdings Indebtedness and any other Indebtedness agreed to by the
Required Lenders.

“Permitted Investments” means:

(a) any Investment in the Borrower or in a Wholly Owned Subsidiary Guarantor;

(b) any Investment in Cash Equivalents;

(c) any Investment by the Borrower or any Subsidiary of the Borrower in a
Person, if as a result of such Investment:

(i) such Person becomes a Wholly Owned Subsidiary Guarantor; or

(ii) such Person is merged, consolidated or amalgamated with or into, or
transfers or conveys substantially all of its assets to, or is liquidated into,
the Borrower or a Wholly Owned Subsidiary Guarantor;

(d) any Investment made as a result of the receipt of non-cash consideration
from an Asset Sale that was made pursuant to and in compliance with
Section 6.03;

(e) any acquisition of assets solely in exchange for the issuance of Equity
Interests (other than Disqualified Stock) of Holdings;

(f) Hedging Obligations;

(g) Investments in existence on the Revolving Credit Facility Closing Date and
modifications thereof;

(h) Investments in securities of trade creditors or customers received in
compromise of obligations of such Person incurred in the ordinary course of
business, including under any plan of reorganization or similar arrangement upon
the bankruptcy or insolvency of such Person;

 

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(i) loans and advances to officers, directors and employees of the Borrower or
any of its Material Subsidiaries in the ordinary course of business not to
exceed $2,000,000 at any time outstanding;

(j) Investments indirectly acquired by the Borrower or any of its Material
Subsidiaries through a direct Investment in another Person made in compliance
with this Agreement, provided that such Investments existed prior to and were
not made in contemplation of such Investment;

(k) from and after any Parent Company Merger, Investments of Holdings in
existence on the Revolving Credit Facility Closing Date; and

(l) other Investments in any Person having an aggregate fair market value
(measured on the date each such Investment was made and without giving effect to
subsequent changes in value), when taken together with all other Investments
made pursuant to this clause (l) since the Revolving Credit Facility Closing
Date that are at the time outstanding, not to exceed $125,000,000.

“Permitted Liens” means:

(a) Liens in favor of the Borrower;

(b) Liens on property of a Person (including shares of stock or Indebtedness
owned by such Person), existing at the time such Person is merged with or into
or consolidated with the Borrower or any Material Subsidiary of the Borrower;
provided that such Liens were in existence prior to the contemplation of such
merger or consolidation and do not extend to any assets other than those of the
Person merged into or consolidated with the Borrower or the Material Subsidiary
of the Borrower;

(c) Liens on property existing at the time of acquisition thereof by the
Borrower or any Material Subsidiary of the Borrower; provided that such Liens
were not incurred in contemplation of such acquisition;

(d) Liens to secure the performance of bids, tenders, leases, statutory
obligations, surety or appeal bonds, performance bonds or other obligations of a
like nature incurred in the ordinary course of business;

(e) Liens to secure Indebtedness (including Capital Lease Obligations) permitted
under subclause (v) of Section 6.01(b) covering only the assets acquired,
constructed or improved with such Indebtedness;

(f) (x) Liens existing on the Revolving Credit Facility Closing Date set forth
on Schedule 6.02 and (y) the GM Liens;

(g) Liens for taxes, assessments or governmental charges or claims that are not
yet delinquent or that are being contested in good faith by appropriate
proceedings promptly instituted and diligently concluded, provided that any
reserve or other appropriate provision as shall be required in conformity with
GAAP shall have been made therefor;

 

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(h) Liens incidental to the conduct of the business of the Borrower or a
Material Subsidiary of the Borrower or the ownership of its property and assets
not securing Indebtedness, and which do not in the aggregate materially detract
from the value of the assets or property of the Borrower and its Material
Subsidiaries taken as a whole, or materially impair the use thereof in the
operation of its business;

(i) Liens incurred or deposits made in the ordinary course of business in
connection with workers’ compensation, unemployment insurance and other types of
social security;

(j) judgment Liens not giving rise to an Event of Default;

(k) easements, rights-of-way, zoning restrictions and other similar charges or
encumbrances in respect of real property not interfering in any material respect
with the ordinary conduct of the business of the Borrower or any of its Material
Subsidiaries;

(l) any interest or title of a lessor under any Capital Lease Obligation;

(m) leases or subleases granted to others that do not materially interfere with
the ordinary course of business of the Borrower and its Material Subsidiaries;

(n) Liens arising from filing Uniform Commercial Code financing statements
regarding leases;

(o) Liens in favor of customs and revenue authorities arising as a matter of law
to secure payment of customer duties in connection with the importation of
goods;

(p) carriers’, warehousemen’s, mechanics’, landlords’, materialmen’s,
repairmen’s or other similar Liens arising in the ordinary course of business
that are not delinquent or remain payable without penalty;

(q) Liens securing Specified Hedging Agreements with Qualified Counterparties
that relate to Indebtedness that is otherwise permitted under this Agreement and
Liens securing Specified Cash Management Arrangement Agreements with Qualified
Counterparties; provided that in no event shall such Liens secure Obligations
(as defined in the Second Lien Intercreditor Agreement) outstanding under such
Specified Agreements in an amount that exceeds the Cap Amount (as defined in the
Second Lien Intercreditor Agreement) minus the sum of (i) the aggregate amount
of the Loans of all Lenders hereunder, any undrawn Commitments under the
Revolving Credit Facility Agreement and any other Obligation (as defined in the
Second Lien Intercreditor Agreement) hereunder and under the other First Lien
Documents (as defined in the Second Lien Intercreditor Agreement) and (ii) the
Obligations (as defined in the Second Lien Intercreditor Agreement) which are
outstanding from time to time under the Existing 10% Notes;

 

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(r) Liens encumbering property or other assets under construction in the
ordinary course of business arising from progress or partial payments by a
customer of the Borrower or the Borrower’s Subsidiaries relating to such
property or other assets;

(s) Liens arising out of conditional sale, title retention, consignment or
similar arrangements for the sale of goods entered into by the Borrower or any
of its Material Subsidiaries in the ordinary course of business;

(t) Liens securing Indebtedness in an aggregate amount not to exceed $20,000,000
at any one time outstanding;

(u) Liens on Qualified Receivables securing Indebtedness permitted under
Section 6.01(b)(x);

(v) from and after any Parent Company Merger, Liens of Holdings in existence on
the Revolving Credit Facility Closing Date;

(w) Liens relating to Satellite Vendor Indebtedness, Holdings Satellite Vendor
Indebtedness or Permitted Refinancing Indebtedness in respect thereof covering
only (i) the assets acquired, constructed, or improved with such Indebtedness,
(ii) the contract of the Borrower or Holdings with the satellite or satellite
launch vendor or Affiliate thereof relating to the manufacture of such assets
(in so far as such contract relates to such assets), (iii) any insurance
policies covering such asset while under construction, and (iv) any proceeds of
any of the foregoing;

(x) Liens securing Indebtedness permitted under Section 6.01(b)(vi); provided
that such Liens are no more extensive than the liens securing the Indebtedness
so refunded, refinanced or replaced thereby;

(y) Liens on the assets of the Borrower or any Material Subsidiary securing
indebtedness incurred in any Qualified Sale and Leaseback Transaction, which,
with respect to the XM-4 Sale and Leaseback Transaction shall be limited to the
XM-4 Satellite Collateral;

(z) Liens (i) either (x) on cash in an amount not to exceed $120,000,000 (plus
any interest thereon accrued with respect to such amount over a period not to
exceed three months) at any time that is deposited into an escrow account to
serve as credit enhancement for the Borrower’s obligations under the MLB
Contract or (y) in respect of the MLB Letter of Credit Cash Collateral and
(ii) on the MLB Intellectual Property, in each case, incurred in connection with
the MLB Contract while such agreement is in effect;

(aa) Liens in favor of the Collateral Agent, the New Collateral Agent and/or the
Administrative Agent for the benefit of the New Secured Parties; and

(bb) Revolving Credit Facility Liens securing the Revolving Credit Facility
Obligations.

 

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“Permitted Refinancing Indebtedness” means any Indebtedness of the Borrower or
any of its Material Subsidiaries issued in exchange for, or the net proceeds of
which are used to extend, refinance, renew, replace, defease or refund other
Indebtedness of the Borrower or any of its Material Subsidiaries (other than
intercompany Indebtedness or the Existing 10% Notes); provided that:

(a) the principal amount (or accreted value, if applicable) of such Permitted
Refinancing Indebtedness does not exceed the principal amount (or accreted
value, if applicable) of the Indebtedness so extended, refinanced, renewed,
replaced, defeased or refunded (plus all accrued interest thereon and the amount
of all expenses, consent fees and premiums incurred in connection therewith);

(b) (i) if such Permitted Refinancing Indebtedness has a Weighted Average Life
to Maturity shorter than that of the Loans or a final maturity date earlier than
the Maturity Date, such Permitted Refinancing Indebtedness shall have a Weighted
Average Life to Maturity no shorter than the remaining Weighted Average Life to
Maturity of the debt so extended, refinanced, renewed, replaced, defeased or
refunded and a final Stated Maturity no earlier than the final maturity date of
the debt so extended, refinanced, renewed, replaced, defeased or refunded or
(ii) in all other cases, such Permitted Refinancing Indebtedness shall have a
final maturity date later than the final maturity date of, and shall have a
Weighted Average Life to Maturity equal to or greater than the Weighted Average
Life to Maturity of the Loans;

(c) if the Indebtedness being extended, refinanced, renewed, replaced, defeased
or refunded is subordinated in right of payment to the Loans, such Permitted
Refinancing Indebtedness is subordinated in right of payment to the Loans on
terms at least as favorable to the Lenders as those contained in the
documentation governing the Indebtedness being extended, refinanced, renewed,
replaced, defeased or refunded;

(d) if the Indebtedness being extended, refinanced, renewed, replaced, defeased
or refunded is unsecured or secured with a Lien that is subordinated to the
Liens created under the Loan Documents, such Permitted Refinancing Indebtedness
is equally unsecured or subordinated, as applicable, on terms at least as
favorable to the Lenders as those contained in the documentation governing the
Indebtedness being extended, refinanced, renewed, replaced, defeased or
refunded;

(e) if the Indebtedness being extended, refinanced, renewed, replaced, defeased
or refunded is secured Equally and Ratably with the Liens created under the Loan
Documents, such Permitted Refinancing Indebtedness is either equally secured or
unsecured, as applicable, on terms at least as favorable to the Lenders as those
contained in the documentation governing the Indebtedness being extended,
refinanced, renewed, replaced, defeased or refunded and, if secured, is subject
to the Security Documents; and

(f) such Indebtedness is incurred either by the Borrower or by the Material
Subsidiary who is the obligor on the Indebtedness being extended, refinanced,
renewed, replaced, defeased or refunded.

 

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“Person” means any natural person, corporation, limited liability company,
trust, joint venture, association, company, partnership, Governmental Authority
or other entity.

“Plan” means any “employee benefit plan” as defined in Section 3(3) of ERISA
which is or was sponsored, maintained or contributed to by, or required to be
contributed by, Borrower, or in respect of which the Borrower or any ERISA
Affiliate is (or, if such plan were terminated, would under Section 4069 of
ERISA be deemed to be) an “employer” as defined in Section 3(5) of ERISA.

“Pledged Collateral” shall have the meaning assigned to such term in the
Collateral Agreement.

“Potential Default” means the potential Default under clause (f)(ii) of Article
VII that would occur as a result of the Borrower being required to (a) make a
“Change of Control Offer” under the New Senior Notes and the Existing 10% Notes
or (b) make an “Offer to Purchase or Refinance” pursuant to Section 11.07 of the
Participation Agreement, in each case as a result of the Merger and/or as a
result of any Merger Related Event.

“Pre-Marketing Cash Flow” means, for any period, the Consolidated Net Income of
Holdings, plus, without duplication and to the extent reflected as a charge in
the statements of such Consolidated Net Income, the sum of (a) income taxes (or
provision for income taxes); (b) interest expenses, losses from de-leveraging or
other one time transactions, and other expenses considered part of the other
expenses category in the consolidated financial statements contained in the
reports of Holdings filed with the Securities and Exchange Commission (the
“Holdings Statements”) and therefore non-operational; (c) losses associated with
investments in non-consolidated Persons; (d) depreciation (including amounts
related to research and development) and amortization expenses; (e) compensation
expenses associated with equity-based compensation for employees and third
parties pursuant to SFAS No. 123R, calculated in the same manner and using the
same designated line items as in the Holdings Statements; (f) all marketing,
advertising, subscriber acquisition and distribution expenses; and (g) expenses
related to the sales of merchandise; and minus, without duplication and to the
extent included in the statements of such Consolidated Net Income, the sum of
(a) interest income, gains from de-leveraging or other one time transactions and
other gains considered part of the other income category in the Holdings
Statements and therefore non-operational; (b) all revenues associated with
investments in non-consolidated Persons; and (c) all gains relating to the sales
of merchandise.

“Prime Rate” means the rate of interest per annum publicly announced from time
to time by UBS AG, Stamford Branch, as its prime rate in effect at its office
located at 677 Washington Blvd, Stamford, CT 06901; each change in the Prime
Rate shall be effective from and including the date such change is publicly
announced as being effective.

“Principals” means American Honda Motor Company, Inc. and GM.

“Principal Related Parties” means (a) any controlling stockholder, 80% (or more)
owned Subsidiary, or immediate family member (in the case of an individual) of
any Principal; or (b) any trust, corporation, partnership or other entity, the
beneficiaries, stockholders, partners,

 

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owners or Persons beneficially holding an 80% or more controlling interest of
which consist of any one or more Principals and/or such other Persons referred
to in the immediately preceding clause (a).

“Proceeds” means, with respect to any issuance or sale of Equity Interests or
Indebtedness or contribution to capital, (a) the cash proceeds of such issuance
or sale or contribution net of attorneys’ fees, accountants’ fees, underwriters’
or placement agents’ fees, discounts or commissions and brokerage, consultant
and other fees actually incurred in connection with such issuance or sale and
net of taxes paid or payable as a result thereof or (b) the fair market value of
any assets or securities that constitute proceeds of such issuance or sale or
contribution, provided that the fair market value of such assets or securities
shall be determined by the Board of Directors whose good faith resolution with
respect thereto shall be conclusive and shall be delivered to the Administrative
Agent, provided further, that the Board of Directors’ determination must be
based on an opinion or appraisal issued by an accounting, appraisal or
investment banking firm of national standing (or, in the case of assets such as
satellites or network components generally found only in the satellite industry,
an appraiser or other professional with expertise in the valuation of assets of
such type) if the fair market value exceeds $20,000,000.

“Qualified Counterparty” shall mean, with respect to any Specified Agreement,
any counterparty thereto that, at the time such Specified Agreement was entered
into, was a Revolving Credit Facility Lender, the Revolving Credit Facility
Administrative Agent or the Revolving Credit Facility Syndication Agent or an
Affiliate of a Revolving Credit Facility Lender, the Revolving Credit Facility
Administrative Agent or the Revolving Credit Facility Syndication Agent.

“Qualified Receivables” means the aggregate amount of accounts receivables of
the Borrower determined in accordance with GAAP that are not more than 90 days
past due.

“Qualified Sale and Leaseback Transaction” means a sale and leaseback
transaction (a) involving one or more satellites of the Borrower or any Material
Subsidiary of the Borrower or that is an XM-4 Sale and Leaseback Transaction and
(b) the Net Proceeds (to the Borrower) of which, together with the aggregate Net
Proceeds (to the Borrower) from all other sale and leaseback transactions
involving satellites consummated after the Revolving Credit Facility Closing
Date (including any subsequent replacements, amendments or modifications
thereof), do not exceed $300,000,000 provided that Indebtedness (the proceeds of
which financed the purchase of the XM-4 Satellite Collateral) of a lessor in an
XM-4 Sale and Leaseback Transaction that is assumed by Holdings, the Borrower or
a Material Subsidiary following the termination of the associated lease and
reacquisition of the associated assets by Holdings, the Borrower or such
Material Subsidiary (as applicable) shall continue to constitute a Qualified
Sale and Leaseback Transaction following such assumption and reacquisition as
long as the Liens securing such Indebtedness do not spread to cover any other
assets other than those that were subjected to such Liens pursuant to the XM-4
Sale and Leaseback Transaction immediately prior to such assumption and
reacquisition.

“Register” has the meaning set forth in Section 9.04(b)(iv).

 

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“Registration Rights Agreement” means the registration rights agreement entered
into on or prior to the Revolving Credit Facility Closing Date among the
Borrower and the initial purchasers of the New Senior Notes.

“Reinvestment Right” means the right of the Borrower and its Material
Subsidiaries to, within 365 days after the receipt of any Net Proceeds from an
Asset Sale, (a) apply such Net Proceeds, at the Borrower’s or such Material
Subsidiary’s option to (i) acquire all or substantially all of the assets of, or
a majority of the Voting Stock of, another Permitted Business, or Voting Stock
of a Material Subsidiary engaged in a Permitted Business (other than any such
Voting Stock owned or held by a Subsidiary), (ii) to make a capital expenditure,
or (iii) to acquire other assets that are used or useful in a Permitted Business
that have an expected useful life of one year or longer, or (b) enter into a
legally binding agreement to apply such Net Proceeds as described in the
preceding clause (a) within six months after such agreement is entered into and
apply such Net Proceeds in accordance with the terms of such agreement or the
provisions of clause (a) above; provided that if such agreement terminates the
Borrower shall have until the earlier of (x) 90 days after the date of such
termination and (y) six months after the date of the Asset Sale resulting in
such Net Proceeds to effect such an application.

“Related Parties” means, with respect to any specified Person, such Person’s
Affiliates and the respective directors, officers, employees, agents and
advisors of such Person and such Person’s Affiliates.

“Release Date” means that date on which (a) all of the Existing 10% Notes shall
have been paid in full, (b) the Obligations under the Existing 10% Notes are no
longer secured by the Existing Security Interest and the Existing Intercreditor
Agreements shall have been terminated, (c) all commitments to lend pursuant to
the Existing 10% Notes shall have been terminated and (d) the Borrower shall
have delivered to the Administrative Agent lien searches showing (i) no Liens
securing obligations in excess of $5,000,000 in the aggregate in favor of any
“lien creditor” (as defined in the UCC), as certified to the Administrative
Agent by a Responsible Officer of the Company, other than those as may be
acceptable to the Administrative Agent and (ii) no Liens in favor of any other
Person, other than Permitted Liens; provided that, if the Revolving Credit
Facility Agreement is then in full force and effect, both the Release Date and
the “Release Date” under the Revolving Credit Facility Agreement shall occur on
the same date.

“Required Lenders” means, at any time, Lenders holding in the aggregate more
than 50% of (i) the Commitments or (ii) if the Commitments have been terminated,
the outstanding Loans.

“Responsible Officer” of any Person shall mean any executive officer or
financial officer of such Person and any other officer or similar official
thereof responsible for the administration of the obligations of such person in
respect of this Agreement.

“Restricted Investment” means any Investment other than a Permitted Investment.

“Restricted Payment” has the meaning assigned to such term in
Section 6.06(a)(4).

“Revolving Credit Facility Administrative Agent” has the meaning assigned to
such term in the definition of Revolving Credit Facility Agreement.

 

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“Revolving Credit Facility Agreement” means that certain Credit Agreement dated
as of May 5, 2006, providing for a revolving credit facility, by and between the
Borrower, Holdings, the Revolving Credit Facility Lenders, JPMorgan Chase Bank,
N.A., as administrative agent (the “Revolving Credit Facility Administrative
Agent”), Credit Suisse Securities (USA) LLC, as syndication agent (the
“Revolving Credit Facility Syndication Agent”), Citicorp North America, Inc., as
documentation agent (the “Revolving Credit Facility Documentation Agent”), and
J.P. Morgan Securities Inc. and UBS Securities LLC, as joint bookrunners and
joint lead arrangers (the “Revolving Credit Facility Arrangers”) (as amended,
restated, modified, replaced or refinanced from time to time).

“Revolving Credit Facility Arrangers” has the meaning assigned to such term in
the definition of Revolving Credit Facility Agreement.

“Revolving Credit Facility Closing Date” means May 5, 2006.

“Revolving Credit Facility Commitments” means, collectively, the commitments to
extend revolving loans made by the Revolving Credit Facility Lenders and to
issue letters of credit made by the issuing bank pursuant to the Revolving
Credit Facility Agreement.

“Revolving Credit Facility Documentation Agent” has the meaning assigned to such
term in the definition of Revolving Credit Facility Agreement.

“Revolving Credit Facility Documents” means, collectively, the Revolving Credit
Facility Agreement, the Security Documents and each other agreement entered into
pursuant to any of the foregoing or contemplated thereby.

“Revolving Credit Facility Lender” means each of the lenders who are party from
time to time to the Revolving Credit Facility Agreement.

“Revolving Credit Facility Liens” means the Liens granted by the Loan Parties
pursuant to the Security Documents on all or any portion of the Collateral in
support of the Borrower’s, Holdings’ and each other Loan Party’s Revolving
Credit Facility Obligations, which Liens shall rank Equally and Ratably with the
Liens securing the obligations in respect of the Loan Documents and, after the
Release Date, shall be subject to the Collateral Agency Agreement.

“Revolving Credit Facility Loans” means, collectively, the loans made by the
Revolving Credit Facility Lenders pursuant to the Revolving Credit Facility
Agreement.

“Revolving Credit Facility Obligations” means, collectively, all obligations of
every nature of Holdings, the Borrower and each Subsidiary of the Borrower that
is a guarantor pursuant to the terms of the Revolving Credit Facility Documents,
in each case from time to time owed to any agent or lender under the Revolving
Credit Facility Documents or any other Revolving Credit Facility Document,
whether for principal, interest, fees, expenses, indemnification, reimbursement
obligations or otherwise and all guarantees of any of the foregoing pursuant to
the Revolving Credit Facility Documents.

“Revolving Credit Facility Secured Parties” means, collectively, the Revolving
Credit Facility Administrative Agent, the Revolving Credit Facility Syndication
Agent, the Revolving Credit Facility Documentation Agent, the Revolving Credit
Facility Arrangers and the Revolving Credit Facility Lenders.

 

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“Revolving Credit Facility Syndication Agent” has the meaning assigned to such
term in the definition of Revolving Credit Facility Agreement.

“Satellite Vendor Indebtedness” means Indebtedness of the Borrower to a
satellite or satellite launch vendor or Affiliate thereof consisting of or
otherwise financing the deferral of payments required to be made by the Borrower
to the vendor in respect of the construction, launch and/or insurance of all or
part of one or more satellites to be used in the Permitted Business but not
beyond the date on which the Borrower shall have legal title to such satellites
or the date of such satellite launches, as applicable.

“Second Lien Intercreditor Agreement” means the Second Lien Intercreditor
Agreement, dated as of May 5, 2006, as amended as of June 26, 2008, among the
Bank of New York, JPMorgan Chase Bank, N.A., the Borrower, Holdings, each
Subsidiary Guarantor and GM, in the form of Exhibit G, as further amended,
supplemented or otherwise modified from time to time.

“Security Documents” means the Existing Collateral Documents, the Collateral
Agreement, the Foreign Pledge Agreements, the Collateral Agency Agreement and
each of the security agreements and other instruments and documents executed and
delivered pursuant to any of the foregoing or pursuant to Section 5.10.

“Senior Fixed Rate Notes” shall mean the $600,000,000 in aggregate principal
amount of unsecured senior fixed rate notes due 2014 issued by the Borrower
pursuant to the applicable Senior Notes Indenture.

“Senior Floating Rate Notes” means the $200,000,000 in aggregate principal
amount of unsecured senior floating rate notes due 2013 issued by the Borrower
pursuant to the applicable Senior Notes Indenture.

“Senior Notes Documents” shall mean, collectively, the Senior Notes Indentures
and the New Senior Notes and any other agreements entered into in connection
therewith.

“Senior Notes Indentures” means (a) the Indenture dated as of May 1, 2006, made
by the Borrower, in favor of the trustee thereunder, pursuant to which the
Senior Floating Rate Notes were issued and (b) the Indenture dated as of May 1,
2006, made by the Borrower, in favor of the trustee thereunder, pursuant to
which the Senior Fixed Rate Notes were issued, in each case as may be amended,
restated, supplemented or otherwise modified from time to time.

“Senior Secured Debt” means at any date the difference between (a) Consolidated
Total Senior Debt on such date and (b) unsecured Indebtedness included in
Consolidated Total Senior Debt on such date.

“Senior Secured Leverage Ratio” means, with respect to Holdings and its
Subsidiaries on a consolidated basis on the last day of any fiscal quarter of
Holdings for the four quarter period ended as of such day, the ratio of
(a) Senior Secured Debt on such date to (b) Pre-Marketing Cash Flow for such
period.

 

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“SIRIUS” means Sirius Satellite Radio Inc.

“Specified Agreement” means any Specified Hedging Agreement and any Specified
Cash Management Arrangement Agreement.

“Specified Cash Management Arrangement” means any arrangement for cash
management, clearing house, wire transfer, depository, treasury or investment
services in connection with any transfer or disbursement of funds through an
automated clearinghouse or on a same day or immediate or accelerated
availability basis (including all monetary obligations, including fees, costs,
expenses and indemnities, whether primary, secondary, direct, contingent, fixed
or otherwise of Holdings, the Borrower or any of its Subsidiaries arising out of
any cash management, clearing house, wire transfer, depository, treasury or
investment services) provided to Holdings, the Borrower or any of its
Subsidiaries by a Qualified Counterparty that has been designated by the
Borrower (with the consent of the Revolving Credit Facility Administrative
Agent, which shall not unreasonably be withheld) as a Specified Cash Management
Arrangement. The designation of any such arrangement as a Specified Cash
Management Arrangement shall not create in favor of the Qualified Counterparty
that is a party thereto any rights in connection with the management,
enforcement or release of any Collateral.

“Specified Cash Management Arrangement Agreement” means any agreement or
document made, delivered or given in connection with any Specified Cash
Management Arrangement.

“Specified Hedging Agreement” means any interest rate Swap Agreement entered
into by the Borrower or any Loan Party and any Qualified Counterparty.

“Stated Maturity” means, with respect to any installment of interest or
principal on any series of Indebtedness, the date on which such payment of
interest or principal was scheduled to be paid in the documentation governing
such Indebtedness, and shall not include any contingent obligations to repay,
redeem or repurchase any such interest or principal prior to the date originally
scheduled for the payment thereof.

“Statutory Reserve Rate” means a fraction (expressed as a decimal), the
numerator of which is the number one and the denominator of which is the number
one minus the aggregate of the maximum reserve percentages (including any
marginal, special, emergency or supplemental reserves) expressed as a decimal
established by the Board to which the Administrative Agent is subject for
eurocurrency funding (currently referred to as “Eurocurrency Liabilities” in
Regulation D of the Board). Such reserve percentages shall include those imposed
pursuant to such Regulation D. Eurodollar Loans shall be deemed to constitute
eurocurrency funding and to be subject to such reserve requirements without
benefit of or credit for proration, exemptions or offsets that may be available
from time to time to any Lender under such Regulation D or any comparable
regulation. The Statutory Reserve Rate shall be adjusted automatically on and as
of the effective date of any change in any reserve percentage.

 

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“Subscriber” means a subscriber in good standing to the XM Radio Service that
has paid subscription fees for at least one month of such service and whose
subscription payments are not delinquent.

“Subsidiary” means, with respect to any specified Person:

(a) any corporation, association or other business entity of which more than 50%
of the total voting power of shares of Equity Interest entitled (without regard
to the occurrence of any contingency) to vote in the election of directors,
managers or trustees thereof is at the time owned or controlled, directly or
indirectly, by such Person or one or more of the other Subsidiaries of that
Person (or a combination thereof); and

(b) any partnership, trust or limited liability company (a) the sole general
partner or the managing general partner, or the sole manager or trustee, of
which is such Person or a Subsidiary of such Person or (b) the only general
partners or managing members of which are such Person or one or more
Subsidiaries of such Person (or a combination thereof).

“Subsidiary Loan Party” shall mean each Subsidiary of the Borrower that is at
any time a Material Subsidiary; provided that the FCC License Subsidiary shall
only be a Subsidiary Loan Party to the extent it is permitted to Guarantee the
Borrower Obligations under applicable law, rules or regulations, including rules
and regulations of the Federal Communications Commission.

“Swap Agreement” means any agreement with respect to any swap, forward, future
or derivative transaction or option or similar agreement involving, or settled
by reference to, one or more rates, currencies, commodities, equity or debt
instruments or securities, or economic, financial or pricing indices or measures
of economic, financial or pricing risk or value or any similar transaction or
any combination of these transactions; provided that no phantom stock or similar
plan providing for payments only on account of services provided by current or
former directors, officers, employees or consultants of the Borrower or the
Subsidiaries shall be a Swap Agreement.

“Syndication Period” means the period commencing on the date that is the later
of (a) three Business Days following the Closing Date and (b) the day that a
road show with respect to New Debt Securities shall have commenced, and, in each
case, ending on the date that is ten Business Days after the commencement of
such road show.

“Tax Sharing Agreement” means the Tax Sharing Agreement dated March 15, 2000
among Holdings, the Borrower and XM Radio Inc., as in effect on the Revolving
Credit Facility Closing Date.

“Taxes” means any and all present or future taxes, levies, imposts, duties,
deductions, charges or withholdings (including any interest, penalties and
additions thereto) imposed by any Governmental Authority.

“Total Assets” means the total assets as set forth on the most recent balance
sheet of the Borrower prepared in accordance with GAAP.

 

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“Total Incremental Equity” means, at any date of determination, the sum of,
without duplication: (a) the aggregate cash proceeds received by the Borrower
since the Revolving Credit Facility Closing Date from the issuance or sale of
Equity Interests of the Borrower to Holdings (other than Disqualified Stock but
including Equity Interests issued upon the conversion of convertible
Indebtedness or from the exercise of options, warrants or rights to purchase
Equity Interests of the Borrower other than Disqualified Stock), or of
contributions to the equity capital of the Borrower by Holdings or the fair
market value of the consideration (if other than cash) from the issuance or sale
of Equity Interests (other than Disqualified Stock) of the Borrower to Holdings
or of actual or deemed capital contributions to the common equity capital of the
Borrower by Holdings from the issuance of Equity Interests of Holdings in
exchange for the retirement of Pari Passu Indebtedness of the Borrower since the
Closing Date, to any Person other than a Subsidiary; plus (b) an amount equal to
the net reduction in Investments in any Person (other than Permitted
Investments) resulting from the payment in cash of dividends, repayments of
loans or advances or other transfers of assets, in each case to the Borrower or
any Material Subsidiary after the Closing Date from such Person; provided,
however, that the amount in the foregoing clause (b) shall not exceed the amount
of Investments previously made (and treated as a Restricted Payment) by the
Borrower or any Material Subsidiary in such Person and that constitutes a
Restricted Payment that has been deducted from Total Incremental Equity pursuant
to clause (c) below; minus (c) the aggregate amount of all Restricted Payments
declared or made on or after the Revolving Credit Facility Closing Date.

“Transactions” means the execution, delivery and performance by the Borrower and
Holdings of this Agreement, the borrowing of Loans, the use of the proceeds
thereof, the execution, delivery and performance by Holdings and the Subsidiary
Loan Parties of the Guarantee Agreement, the execution and delivery by the
Borrower and Holdings of the first amendment to the Second Lien Intercreditor
Agreement, the execution, delivery and performance by the Borrower and Holdings
of the fourth amendment to the Revolving Credit Facility Agreement, the
execution and delivery by the Borrower and Holdings of the Collateral Agency
Agreement, and the grant of security interests by the Loan Parties pursuant to
the Security Documents.

“Type”, when used in reference to any Loan, refers to whether the rate of
interest on such Loan is determined by reference to the Adjusted LIBO Rate or
the Alternate Base Rate.

“UCC” means the Uniform Commercial Code as in effect in the State of New York or
any other applicable jurisdiction.

“Voting Stock” of any Person as of any date means the Equity Interests of such
Person that is at the time entitled to vote in the election of the board of
directors of such Person.

“Weighted Average Life to Maturity” means, when applied to any Indebtedness or
Disqualified Stock at any date, the number of years obtained by dividing:

(1) the sum of the products obtained by multiplying (a) the amount of each then
remaining installment, sinking fund, serial maturity or other required payments
of principal (or liquidation preference, as applicable), including payment at
final maturity, in respect thereof, by (b) the number of years (calculated to
the nearest one-twelfth) that will elapse between such date and the making of
such payment; by

 

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(2) the then outstanding principal amount (or liquidation preference) of such
Indebtedness (or Disqualified Stock, as applicable).

“Wholly Owned Subsidiary” of any specified Person means a Subsidiary of such
Person all of the outstanding Equity Interests or other ownership interests of
which (other than directors’ qualifying shares) shall at the time be owned by
such Person or by one or more Wholly Owned Subsidiaries of such Person and one
or more Wholly Owned Subsidiaries of such Person.

“Wholly Owned Subsidiary Guarantor” means a Wholly Owned Subsidiary of the
Borrower that Guarantees the Borrower Obligations pursuant to the Loan
Documents.

“Withdrawal Liability” means liability to a Multiemployer Plan as a result of a
complete or partial withdrawal from such Multiemployer Plan, as such terms are
defined in Part I of Subtitle E of Title IV of ERISA.

“XM-4 Sale and Leaseback Extension” means either (i) each extension, in
accordance with the terms of the Participation Agreement, by the Lessor (as
defined in the Participation Agreement), the Owner Participant (as defined in
the Participation Agreement), the holders of the Owner Trustee Notes and each
other applicable party in respect of the XM-4 Sale and Leaseback Transaction
consummated pursuant to the Participation Agreement (each such foregoing Person,
an “XM-4 Sale and Leaseback Party”) of the date on which the Borrower is
required to make an XM-4 Sale and Leaseback Offer to Purchase or Refinance as a
result of any “Change of Control” or “SDARS License Event” (each term under and
as defined in the Participation Agreement) that occurs or will occur in
connection with the Merger and/or any Merger Related Event or (ii) each
declining, in accordance with the terms of the Participation Agreement, of an
XM-4 Sale and Leaseback Offer to Purchase or Refinance that occurs or will occur
in connection with the Merger and/or any Merger Related Event in exchange for a
commitment by the Borrower to make another such offer, for one or both of the
Beneficial Interest or the Owner Trustee Notes, at a later date.

“XM-4 Sale and Leaseback Offer to Purchase or Refinance” means the Offer to
Purchase or Refinance (as defined in the Participation Agreement) made by the
Borrower in connection with the Merger and/or any Merger Related Event pursuant
to the terms of Section 11.07 of the Participation Agreement.

“XM-4 Sale and Leaseback Party” has the meaning assigned to such term in the
definition of “XM-4 Sale and Leaseback Extension.”

“XM-4 Sale and Leaseback Repurchase Date” means the date on which the Borrower
and/or Holdings is required to purchase any or all of the Transponders (as
defined in the Participation Agreement) pursuant to the terms of the XM-4 Sale
and Leaseback Offer to Purchase or Refinance and in accordance with the terms of
the Participation Agreement and this Agreement.

 

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“XM-4 Sale and Leaseback Transaction” means a sale and leaseback transaction
(whether classified as an operating lease, a capital lease or otherwise, and
whether leased by Holdings, the Borrower or a Material Subsidiary) involving the
XM-4 Satellite Collateral (including a sale and leaseback of transponders on the
XM-4 Satellite, to the extent such transponders constitute XM-4 Satellite
Collateral, and grants of security interests in the remaining portions of the
XM-4 Satellite Collateral in favor of the buyer or lessor); provided that any
Indebtedness (the proceeds of which financed the purchase of the XM-4 Satellite
Collateral) of a lessor in an XM-4 Sale and Leaseback Transaction that is
assumed by Holdings, the Borrower or a Material Subsidiary following the
termination of the associated lease and acquisition or reacquisition of the
associated assets by Holdings, the Borrower or such Material Subsidiary (as
applicable) shall continue to constitute an XM-4 Sale and Leaseback Transaction
following such assumption and acquisition or reacquisition as long as the Liens
securing such Indebtedness do not spread to cover any other assets other than
those that were subjected to such Liens pursuant to the XM-4 Sale and Leaseback
Transaction immediately prior to such assumption and acquisition or
reacquisition.

“XM-4 Sale and Leaseback Waiver” means either (i) the waiver, in accordance with
the terms of the Participation Agreement, by the Lessor (as defined in the
Participation Agreement), the Owner Participant (as defined in the Participation
Agreement), the holders of the Owner Trustee Notes and each other applicable
party in respect of the XM-4 Sale and Leaseback Transaction consummated pursuant
to the Participation Agreement of any “Change of Control” or “SDARS License
Event” (each term under and as defined in the Participation Agreement) or
(ii) the declining, in accordance with the terms of the Participation Agreement,
of an XM-4 Sale and Leaseback Offer to Purchase or Refinance, in each case that
occurs or will occur in connection with the Merger and/or any Merger Related
Event and the consequences of such “Change of Control” or “SDARS License Event”
(including, for purposes of clause (i) above, the requirement that the Borrower
make an XM-4 Sale and Leaseback Offer to Purchase or Refinance).

“XM-4 Sale and Leaseback Waiver Date” means the date on which the XM-4 Sale and
Leaseback Waiver shall be effective in accordance with its terms.

“XM-4 Satellite” means the satellite known as XM-4 and owned by either Holdings
or the Borrower.

“XM-4 Satellite Collateral” means the XM-4 Satellite and the Ancillary XM-4
Satellite Collateral. For the avoidance of doubt, Indivisible Ancillary XM-4
Satellite Collateral shall not constitute XM-4 Satellite Collateral.

“XM-5 Satellite” means the satellite known as XM-5 and currently under
construction pursuant to a contract among Holdings and the satellite vendor
party thereto.

“XM Radio Service” means digital radio programming transmitted by satellites and
terrestrial repeating stations to vehicle, home and portable radios in the
United States.

 

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SECTION 1.02 Classification of Loans and Borrowings. For purposes of this
Agreement, Loans may be classified by Type (e.g., a “Eurodollar Loan”).
Borrowings may also be classified by Type (e.g., a “Eurodollar Borrowing”).

SECTION 1.03 Terms Generally. The definitions of terms herein shall apply
equally to the singular and plural forms of the terms defined. Whenever the
context may require, any pronoun shall include the corresponding masculine,
feminine and neuter forms. The words “include”, “includes” and “including” shall
be deemed to be followed by the phrase “without limitation”. The word “will”
shall be construed to have the same meaning and effect as the word “shall”.
Unless the context requires otherwise (a) any definition of or reference to any
agreement, instrument or other document herein shall be construed as referring
to such agreement, instrument or other document as from time to time amended,
supplemented or otherwise modified (subject to any restrictions on such
amendments, supplements or modifications set forth herein), (b) any reference
herein to any Person shall be construed to include such Person’s successors and
assigns, (c) the words “herein”, “hereof” and “hereunder”, and words of similar
import, shall be construed to refer to this Agreement in its entirety and not to
any particular provision hereof, (d) all references herein to Articles,
Sections, Exhibits and Schedules shall be construed to refer to Articles and
Sections of, and Exhibits and Schedules to, this Agreement and (e) the words
“asset” and “property” shall be construed to have the same meaning and effect
and to refer to any and all tangible and intangible assets and properties,
including cash, securities, accounts and contract rights.

SECTION 1.04 Accounting Terms; GAAP. Except as otherwise expressly provided
herein, all terms of an accounting or financial nature shall be construed in
accordance with GAAP, as in effect from time to time; provided that, if the
Borrower notifies the Administrative Agent that the Borrower requests an
amendment to any provision hereof to eliminate the effect of any change
occurring after the date hereof in GAAP or in the application thereof on the
operation of such provision (or if the Administrative Agent notifies the
Borrower that the Required Lenders request an amendment to any provision hereof
for such purpose), regardless of whether any such notice is given before or
after such change in GAAP or in the application thereof, then such provision
shall be interpreted on the basis of GAAP as in effect and applied immediately
before such change shall have become effective until such notice shall have been
withdrawn or such provision amended in accordance herewith.

ARTICLE II.

The Credits

SECTION 2.01 Loan Commitments. Subject to the terms and conditions hereof, each
Lender severally agrees to make, on the Closing Date, a term loan (each, a
“Loan”, and collectively, the “Loans”) to the Borrower in an amount equal to
such Lender’s Commitment.

The Lenders will make only one funding in respect to the Commitments which shall
be on the Closing Date. Any amount borrowed under this Section 2.01 and
subsequently repaid or prepaid (pursuant to Section 2.10 or otherwise) may not
be reborrowed. All amounts owed hereunder with respect to the Loans shall be
paid in full no later than the Maturity Date. Each Lender’s Commitment shall
terminate immediately and without further action on the Closing Date after
giving effect to the funding of such Lender’s Commitment on such date.

 

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SECTION 2.02 Types of Loans. The Loans made as of the Closing Date shall be made
as part of a Borrowing consisting of Loans made by the Lenders ratably in
accordance with their respective Commitments. Subject to Section 2.13, each
Borrowing shall be comprised entirely of ABR Loans or Eurodollar Loans as the
Borrower may request in accordance herewith. At the commencement of each
Interest Period for any Eurodollar Borrowing, such Borrowing shall be in an
aggregate amount that is an integral multiple of $1,000,000 and not less than
$5,000,000. At the time that each ABR Borrowing is made, such Borrowing shall be
in an aggregate amount that is an integral multiple of $1,000,000 and not less
than $5,000,000. Borrowings of more than one Type may be outstanding at the same
time; provided that there shall not at any time be more than a total of 5
Eurodollar Borrowings outstanding. Notwithstanding any other provision of this
Agreement, the Borrower shall not be entitled to request, or to elect to convert
or continue, any Borrowing if the Interest Period requested with respect thereto
would end after the Maturity Date.

SECTION 2.03 Request for Borrowing. To request a Borrowing, the Borrower shall
notify the Administrative Agent of such request by telephone (a) in the case of
a Eurodollar Borrowing, not later than 11:00 a.m., New York City time, three
Business Days before the Closing Date or (b) in the case of an ABR Borrowing,
not later than 11:00 a.m., New York City time, one Business Day before the
Closing Date. Each such telephonic Borrowing Request shall be irrevocable and
shall be confirmed promptly by hand delivery or telecopy to the Administrative
Agent of a written Borrowing Request in a form approved by the Administrative
Agent and signed by the Borrower. Each such telephonic and written Borrowing
Request shall specify the following information:

(i) the aggregate amount of the requested Borrowing;

(ii) the date of such requested Borrowing, which shall be a Business Day;

(iii) whether such Borrowing is to be an ABR Borrowing or a Eurodollar
Borrowing;

(iv) in the case of a Eurodollar Borrowing, the initial Interest Period to be
applicable thereto, which shall be a period contemplated by the definition of
the term “Interest Period”; and

(v) the location and number of the Borrower’s account to which funds are to be
disbursed, which shall comply with the requirements of Section 2.06.

If no election as to the Type of Borrowing is specified, then the requested
Borrowing shall be an ABR Borrowing. If no Interest Period is specified with
respect to any requested Eurodollar Borrowing, then the Borrower shall be deemed
to have selected an Interest Period of one month’s duration. Promptly following
receipt of a Borrowing Request in accordance with this Section, the
Administrative Agent shall advise each Lender of the details thereof and of the
amount of such Lender’s Loan to be made as part of the requested Borrowing.

 

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SECTION 2.04 Reserved.

SECTION 2.05 Reserved.

SECTION 2.06 Funding of Loans. (a) Each Lender shall make each Loan to be made
by it hereunder on the Closing Date by wire transfer of immediately available
funds by 12:00 noon, New York City time, to the account of the Administrative
Agent most recently designated by it for such purpose by notice to the Lenders.
The Administrative Agent will make such Loans available to the Borrower by
promptly crediting the amounts so received, in like funds, to an account of the
Borrower maintained with the Administrative Agent in New York City and
designated by the Borrower in the applicable Borrowing Request.

(b) Unless the Administrative Agent shall have received notice from a Lender
prior to the Closing Date that such Lender shall not make available to the
Administrative Agent such Lender’s share of the Loans, the Administrative Agent
may assume that such Lender has made such share available on such date in
accordance with paragraph (a) of this Section and may, in reliance upon such
assumption, make available to the Borrower a corresponding amount. In such
event, if a Lender has not in fact made its share of the Loans available to the
Administrative Agent, then the applicable Lender and the Borrower severally
agree to pay to the Administrative Agent forthwith on demand such corresponding
amount with interest thereon, for each day from and including the date such
amount is made available to the Borrower to but excluding the date of payment to
the Administrative Agent, at (i) in the case of such Lender, the greater of the
Federal Funds Effective Rate and a rate determined by the Administrative Agent
in accordance with banking industry rules on interbank compensation or (ii) in
the case of the Borrower, the interest rate applicable to ABR Loans. If such
Lender pays such amount to the Administrative Agent, then such amount shall
constitute such Lender’s Loan.

SECTION 2.07 Interest Elections. (a) Each Loan initially shall be of the Type
specified in the applicable Borrowing Request and, in the case of a Eurodollar
Loan, shall have an initial Interest Period as specified in such Borrowing
Request. Thereafter, the Borrower may elect to convert such Loan to a different
Type or to continue the initial Type of such Loan and, in the case of a
Eurodollar Loan, may elect Interest Periods therefor, all as provided in this
Section. The Borrower may elect different options with respect to different
portions of the affected Loans, in which case each such portion shall be
allocated ratably among the Lenders holding such Loans.

(b) To make an election pursuant to this Section, the Borrower shall notify the
Administrative Agent of such election by telephone (i) in the case of a
Eurodollar Loan, not later than 2:00 p.m., New York City time, three Business
Days before the date of the proposed election or (ii) in the case of an ABR
Loan, not later than 2:00 pm, New York City time, one Business Day before the
date of the proposed election, of the Type resulting from such election to be
made on the effective date of such election. Each such telephonic Interest
Election Request shall be irrevocable and shall be confirmed promptly by hand
delivery or telecopy to the Administrative Agent of a written Interest Election
Request in a form approved by the Administrative Agent and signed by the
Borrower.

 

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(c) Each telephonic and written Interest Election Request shall specify the
following information:

(i) the Loans to which such Interest Election Request applies and, if different
options are being elected with respect to different portions thereof, the
portions thereof to be allocated in accordance with clause (a) above (in which
case the information to be specified pursuant to clauses (iii) and (iv) below
shall be specified for each portion of such Loans);

(ii) the effective date of the election made pursuant to such Interest Election
Request, which shall be a Business Day;

(iii) whether the resulting Loan is to be an ABR Loan or a Eurodollar Loan; and

(iv) if the resulting Loan is a Eurodollar Loan, the Interest Period to be
applicable thereto after giving effect to such election, which shall be a period
contemplated by the definition of the term “Interest Period”.

If any such Interest Election Request requests a Eurodollar Loan but does not
specify an Interest Period, then the Borrower shall be deemed to have selected
an Interest Period of one month’s duration.

(d) Promptly following receipt of an Interest Election Request, the
Administrative Agent shall advise each Lender of the details thereof and of such
Lender’s portion of each resulting Loan.

(e) If the Borrower fails to deliver a timely Interest Election Request with
respect to a Eurodollar Loan prior to the end of the Interest Period applicable
thereto, then, unless such Loan is repaid as provided herein, at the end of such
Interest Period such Loan shall be converted to an ABR Loan. Notwithstanding any
contrary provision hereof, if an Event of Default has occurred and is continuing
and the Administrative Agent, at the request of the Required Lenders, so
notifies the Borrower, then, so long as an Event of Default is continuing (i) no
Loan may be converted to or continued as a Eurodollar Loan and (ii) unless
repaid, each Eurodollar Loan shall be converted to an ABR Loan at the end of the
Interest Period applicable thereto.

SECTION 2.08 Reserved.

SECTION 2.09 Repayment of Loans; Evidence of Debt. (a) The Borrower hereby
unconditionally promises to pay to the Administrative Agent for the account of
each Lender the then unpaid principal amount of each Loan on the Maturity Date.

(b) The Administrative Agent shall maintain a Register in accordance with
Section 9.04(b)(iv).

(c) Any Lender may request that Loans made by it be evidenced by a promissory
note. In such event, the Borrower shall prepare, execute and deliver to such
Lender a

 

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promissory note payable to the order of such Lender (or, if requested by such
Lender, to such Lender and its registered assigns) and in a form approved by the
Administrative Agent. Thereafter, the Loans evidenced by such promissory note
and interest thereon shall at all times (including after assignment pursuant to
Section 9.04) be represented by one or more promissory notes in such form
payable to the order of the payee named therein.

SECTION 2.10 Prepayment of Loans and Asset Sale Offer. (a) The Borrower shall
have the right at any time and from time to time to prepay any Loan in whole or
in part, subject to prior notice in accordance with paragraph (b) of this
Section.

(b) The Borrower shall notify the Administrative Agent by telephone (confirmed
by telecopy) of any prepayment hereunder (i) in the case of prepayment of a
Eurodollar Loan, not later than 11:00 a.m., New York City time, three Business
Days before the date of prepayment, or (ii) in the case of prepayment of an ABR
Loan, not later than 11:00 a.m., New York City time, one Business Day before the
date of prepayment. Each such notice shall be irrevocable and shall specify the
prepayment date and the principal amount of each Loan or portion thereof to be
prepaid; provided that a notice of prepayment of the Loans delivered by the
Borrower may state that such notice is conditioned upon the effectiveness of
other credit facilities, in which case such notice may be revoked by the
Borrower (by notice to the Administrative Agent on or prior to the specified
effective date) if such condition is not satisfied. Promptly following receipt
of any such notice relating to a prepayment of Loans, the Administrative Agent
shall advise the Lenders of the contents thereof. Each partial prepayment of any
Loan pursuant to Section 2.10(a) shall be in an amount that is an integral
multiple of $1,000,000 and not less than $5,000,000. Each prepayment shall be
applied ratably to the Lenders in accordance with their respective Loans.
Prepayments shall be accompanied by accrued interest to the extent required by
Section 2.12.

(c) If, at any time, the aggregate amount of Excess Proceeds of the Borrower and
its Material Subsidiaries shall exceed $10,000,000, within three (3) Business
Days of such date, an amount equal to the entire amount of such Excess Proceeds
shall be offered (the “Asset Sale Offer”) to the Lenders and the Revolving
Credit Facility Lenders on a pro rata basis in accordance with their respective
Loans and Revolving Credit Facility Commitments, respectively, to be applied to
prepay Loans and to the permanent reduction of the total Revolving Credit
Facility Commitments, respectively, on the date that is 10 Business Days after
the making of such Asset Sale Offer. If a Lender or any such Revolving Credit
Facility Lender does not accept such Asset Sale Offer within five Business Days
of the making of such Asset Sale Offer by providing notice of its acceptance to
the Administrative Agent or the Revolving Credit Facility Administrative Agent,
as the case may be, such amount may be used by the Borrower for any purposes not
otherwise prohibited by this Agreement.

(d) If, at any time, a Change in Control shall have occurred, the Borrower
shall, within one Business Day thereof, make an offer (the “Change in Control
Offer”) to prepay the Loans of all accepting Lenders on that date that is 10
Business Days after the making of such Change in Control Offer. The Loans of all
Lenders that have so accepted such offer shall be prepaid on such tenth Business
Day.

 

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(e) The application of any prepayment pursuant to this Section 2.10 shall be
made, first, to Alternate Base Rate Loans and, second, to Eurodollar Loans.

SECTION 2.11 Fees. The Borrower agrees to pay as and when due to the Persons
entitled thereto those fees set forth in that certain Fee Letter, dated June 26,
2008 between the Borrower, UBS Loan Finance LLC and UBS Securities LLC (the “Fee
Letter”). No fees paid shall be refundable under any circumstances.

SECTION 2.12 Interest. (a) ABR Loans shall bear interest at the Alternate Base
Rate plus the Applicable Rate.

(b) Eurodollar Loans shall bear interest at the Adjusted LIBO Rate for the
Interest Period in effect for such Eurodollar Loans plus the Applicable Rate.

(c) Notwithstanding the foregoing, if any principal of or interest on any Loan
or any fee or other amount payable by the Borrower hereunder is not paid when
due, whether at stated maturity, upon acceleration or otherwise, such overdue
amount shall bear interest, after as well as before judgment, at a rate per
annum equal to (i) in the case of overdue principal of any Loan, 2% plus the
rate otherwise applicable to such Loan as provided in the preceding paragraphs
of this Section or (ii) in the case of any other amount, 2% plus the rate
applicable to ABR Loans as provided in paragraph (a) of this Section.

(d) Accrued interest on each Loan shall be payable in arrears on each Interest
Payment Date for such Loan and on the Maturity Date; provided that (i) interest
accrued pursuant to paragraph (c) of this Section shall be payable on demand,
(ii) in the event of any repayment or prepayment of any Loan, accrued interest
on the principal amount repaid or prepaid shall be payable on the date of such
repayment or prepayment and (iii) in the event of any conversion of any
Eurodollar Loan prior to the end of the current Interest Period therefor,
accrued interest on such Loan shall be payable on the effective date of such
conversion.

(e) All interest hereunder shall be computed on the basis of a year of 360 days,
except that interest computed by reference to the Alternate Base Rate at times
when the Alternate Base Rate is based on the Prime Rate shall be computed on the
basis of a year of 365 days (or 366 days in a leap year), and in each case shall
be payable for the actual number of days elapsed (including the first day but
excluding the last day). The applicable Alternate Base Rate, Adjusted LIBO Rate
or LIBO Rate shall be determined by the Administrative Agent, and such
determination shall be conclusive absent manifest error.

SECTION 2.13 Alternate Rate of Interest. If prior to the commencement of any
Interest Period for a Eurodollar Loan:

(a) the Administrative Agent determines (which determination shall be conclusive
absent manifest error) that adequate and reasonable means do not exist for
ascertaining the Adjusted LIBO Rate or the LIBO Rate, as applicable, for such
Interest Period; or

(b) the Administrative Agent is advised by the Required Lenders that the
Adjusted LIBO Rate for such Interest Period will not adequately and fairly
reflect the cost to such Lenders (or Lender) of making or maintaining their
Loans (or its Loan) for such Interest Period,

 

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then the Administrative Agent shall give notice thereof to the Borrower and the
Lenders by telephone or telecopy as promptly as practicable thereafter and,
until the Administrative Agent notifies the Borrower and the Lenders that the
circumstances giving rise to such notice no longer exist, (i) any Interest
Election Request that requests the conversion of any ABR Loan to, or
continuation of any Eurodollar Loan as, a Eurodollar Loan shall be ineffective
and (ii) if any Borrowing Request requests a Eurodollar Loan, such Loan shall be
made as an ABR Loan.

SECTION 2.14 Increased Costs. (a) If any Change in Law shall:

(i) impose, modify or deem applicable any reserve, special deposit or similar
requirement against assets of, deposits with or for the account of, or credit
extended by, any Lender (except any such reserve requirement reflected in the
Adjusted LIBO Rate); or

(ii) impose on any Lender or the London interbank market any other condition
affecting this Agreement or Eurodollar Loans made by such Lender;

and the result of any of the foregoing shall be to increase the cost to such
Lender of making or maintaining any Eurodollar Loan (or of maintaining its
obligation to make any such Loan) or to reduce the amount of any sum received or
receivable by such Lender hereunder (whether of principal, interest or
otherwise), then the Borrower will pay to such Lender such additional amount or
amounts as will compensate such Lender for such additional costs incurred or
reduction suffered.

(b) If any Lender determines that any Change in Law regarding capital
requirements has or would have the effect of reducing the rate of return on such
Lender’s capital or on the capital of such Lender’s holding company, if any, as
a consequence of this Agreement or the Loans made by such Lender, to a level
below that which such Lender or such Lender’s holding company could have
achieved but for such Change in Law (taking into consideration such Lender’s
policies and the policies of such Lender’s holding company with respect to
capital adequacy), then from time to time the Borrower will pay to such Lender
such additional amount or amounts as will compensate such Lender or such
Lender’s holding company for any such reduction suffered.

(c) A certificate of a Lender setting forth the amount or amounts necessary to
compensate such Lender or its holding company, as the case may be, as specified
in paragraph (a) or (b) of this Section shall be delivered to the Borrower and
shall be conclusive absent manifest error. The Borrower shall pay such Lender
the amount shown as due on any such certificate within 10 days after receipt
thereof.

(d) Failure or delay on the part of any Lender to demand compensation pursuant
to this Section shall not constitute a waiver of such Lender’s right to demand
such compensation; provided that the Borrower shall not be required to
compensate a Lender pursuant to this Section for any increased costs or
reductions incurred more than 90 days prior to the date that such Lender
notifies the Borrower of the Change in Law giving rise to such increased costs

 

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or reductions and of such Lender’s intention to claim compensation therefor;
provided further that, if the Change in Law giving rise to such increased costs
or reductions is retroactive, then the 90-day period referred to above shall be
extended to include the period of retroactive effect thereof.

SECTION 2.15 Break Funding Payments. In the event of (a) the payment of any
principal of any Eurodollar Loan other than on the last day of an Interest
Period applicable thereto (including as a result of an Event of Default),
(b) the conversion of any Eurodollar Loan other than on the last day of the
Interest Period applicable thereto, (c) the failure to borrow, convert, continue
or prepay any Eurodollar Loan on the date specified in any notice delivered
pursuant hereto (regardless of whether such notice may be revoked under
Section 2.10(b) and is revoked in accordance therewith) or (d) the assignment of
any Eurodollar Loan other than on the last day of the Interest Period applicable
thereto as a result of a request by the Borrower pursuant to Section 2.18, then,
in any such event, the Borrower shall compensate each Lender for the loss, cost
and expense attributable to such event. In the case of a Eurodollar Loan, such
loss, cost or expense to any Lender shall be deemed to include an amount
determined by such Lender to be the excess, if any, of (i) the amount of
interest which would have accrued on the principal amount of such Loan had such
event not occurred, at the Adjusted LIBO Rate that would have been applicable to
such Loan, for the period from the date of such event to the last day of the
then current Interest Period therefor (or, in the case of a failure to borrow,
convert or continue, for the period that would have been the Interest Period for
such Loan), over (ii) the amount of interest which would accrue on such
principal amount for such period at the interest rate which such Lender would
bid were it to bid, at the commencement of such period, for dollar deposits of a
comparable amount and period from other banks in the eurodollar market. A
certificate of any Lender setting forth any amount or amounts that such Lender
is entitled to receive pursuant to this Section shall be delivered to the
Borrower and shall be conclusive absent manifest error. The Borrower shall pay
such Lender the amount shown as due on any such certificate within 10 days after
receipt thereof.

SECTION 2.16 Taxes. (a) Any and all payments by or on account of any obligation
of the Borrower hereunder shall be made free and clear of and without deduction
for any Taxes; provided that if the Borrower shall be required by applicable law
to deduct any Taxes from such payments, then (i) in the case of Indemnified
Taxes (including Other Taxes), the sum payable shall be increased as necessary
so that after making all required deductions (including deductions applicable to
additional sums payable under this Section) the Administrative Agent or Lender
(as the case may be) receives an amount equal to the sum it would have received
had no such deductions been made, (ii) the Borrower shall make such deductions
and (iii) the Borrower shall pay the full amount deducted to the relevant
Governmental Authority in accordance with applicable law.

(b) In addition, the Borrower shall pay any Other Taxes to the relevant
Governmental Authority in accordance with applicable law.

(c) The Borrower shall indemnify the Administrative Agent and each Lender,
within 10 days after written demand therefor, for the full amount of any
Indemnified Taxes (including Other Taxes) paid by the Administrative Agent or
such Lender, as the case may be, on or with respect to any payment by or on
account of any obligation of the Borrower hereunder

 

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(including such Taxes imposed or asserted on or attributable to amounts payable
under this Section) and any penalties, interest and reasonable expenses arising
therefrom or with respect thereto, whether or not such Taxes were correctly or
legally imposed or asserted by the relevant Governmental Authority; provided
that the Borrower shall not be obligated to make payment to the Administrative
Agent or such Lender pursuant to this Section in respect of penalties or
interest attributable to any Indemnified Taxes if (i) written demand therefor
has not been made by the Administrative Agent or such Lender within 90 days from
the date on which the Administrative Agent or such Lender knew of the imposition
of Indemnified Taxes by the relevant Governmental Authority, or (ii) such
penalties or interest are attributable to the gross negligence or willful
misconduct of the Administrative Agent or such Lender. After the Administrative
Agent or such Lender learns of the imposition of Indemnified Taxes, the
Administrative Agent or such Lender, as the case may be, will act in good faith
to promptly notify the Borrower of its obligations hereunder. A certificate as
to the amount of such payment or liability delivered to the Borrower by a Lender
or by the Administrative Agent on its own behalf or on behalf of a Lender, shall
be conclusive absent manifest error.

(d) As soon as practicable after any payment of Indemnified Taxes (including
Other Taxes) by the Borrower to a Governmental Authority and in any event within
30 days of any such payment being made, the Borrower shall deliver to the
Administrative Agent the original or a certified copy of a receipt issued by
such Governmental Authority evidencing such payment, a copy of the return
reporting such payment or other evidence of such payment reasonably satisfactory
to the Administrative Agent.

(e) Each Foreign Lender shall, to the extent it may lawfully do so, deliver to
the Borrower and the Administrative Agent (in such number of copies as shall be
requested by the recipient) on or prior to the date on which such Foreign Lender
becomes a Lender under this Agreement (and from time to time thereafter upon the
request of Borrower or the Administrative Agent, but only if such Foreign Lender
is legally entitled to do so), whichever of the following is applicable:

(i) duly completed copies of Internal Revenue Service Form W-8BEN claiming
eligibility for benefits of an income tax treaty to which the United States of
America is a party;

(ii) duly completed copies of Internal Revenue Service Form W-8ECI; or

(iii) in the case of a Foreign Lender claiming the benefits of the exemption for
portfolio interest under Section 881(c) of the Code, (x) a certificate, in
substantially the form of Exhibit I, or any other form approved by the
Administrative Agent, to the effect that such Foreign Lender is not (A) a “bank”
within the meaning of Section 881(c)(3)(A) of the Code, (B) a “10 percent
shareholder” of Borrower within the meaning of Section 881(c)(3)(B) of the Code,
or (C) a “controlled foreign corporation” described in Section 881(c)(3)(C) of
the Code and (y) duly completed copies of Internal Revenue Service Form W-8BEN.

 

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(f) Each Foreign Lender agrees to promptly notify the Administrative Agent and
the Borrower of any change in circumstances which would modify or render invalid
any claimed exemption or reduction or any certification previously provided to
the Administrative Agent or the Borrower.

(g) If the Administrative Agent or a Lender determines, in its sole discretion,
that it has received a refund of any Indemnified Taxes (including Other Taxes)
as to which it has been indemnified by the Borrower or with respect to which the
Borrower has paid additional amounts pursuant to this Section 2.16, it shall pay
over such refund to the Borrower (but only to the extent of indemnity payments
made, or additional amounts paid, by the Borrower under this Section 2.16 with
respect to the Indemnified Taxes or Other Taxes giving rise to such refund), net
of all out-of-pocket expenses of the Administrative Agent or such Lender and
without interest (other than any interest paid by the relevant Governmental
Authority with respect to such refund); provided, that the Borrower, upon the
request of the Administrative Agent or such Lender, agrees to repay the amount
paid over to the Borrower (plus any penalties, interest or other charges imposed
by the relevant Governmental Authority) to the Administrative Agent or such
Lender in the event the Administrative Agent or such Lender is required to repay
such refund to such Governmental Authority. This Section shall not be construed
to require the Administrative Agent or any Lender to make available its tax
returns (or any other information relating to its taxes which it deems
confidential) to the Borrower or any other Person. Notwithstanding anything to
the contrary, in no event will any Lender be required to pay any amount to the
Borrower, the payment of which would place such Lender in a less favorable net
after-tax position than such Lender would have been in if the additional amounts
giving rise to such refund of any Indemnified Taxes or Other Taxes had never
been paid.

SECTION 2.17 Payments Generally; Pro Rata Treatment; Sharing of Set-offs.
(a) The Borrower shall make each payment required to be made by it hereunder
(whether of principal, interest or fees, or of amounts payable under
Section 2.14, 2.15 or 2.16, or otherwise) prior to 2:00 p.m., New York City
time, on the date when due, in immediately available funds, without set-off or
counterclaim. Any amounts received after such time on any date may, in the
discretion of the Administrative Agent, be deemed to have been received on the
next succeeding Business Day for purposes of calculating interest thereon. All
such payments shall be made to the Administrative Agent at its offices at 270
Park Avenue, New York, New York, except that payments pursuant to Sections 2.14,
2.15, 2.16 and 9.03 shall be made directly to the Persons entitled thereto. The
Administrative Agent shall distribute any such payments received by it for the
account of any other Person to the appropriate recipient promptly following
receipt thereof. If any payment hereunder shall be due on a day that is not a
Business Day, the date for payment shall be extended to the next succeeding
Business Day, and, in the case of any payment accruing interest, interest
thereon shall be payable for the period of such extension. All payments
hereunder shall be made in U.S. dollars.

(b) If at any time insufficient funds are received by and available to the
Administrative Agent to pay fully all amounts of principal, interest and fees
then due hereunder, such funds shall be applied (i) first, towards payment of
interest and fees then due hereunder, ratably among the parties entitled thereto
in accordance with the amounts of interest and fees then due to such parties,
and (ii) second, towards payment of principal then due hereunder, ratably among
the parties entitled thereto in accordance with the amounts of principal then
due to such parties.

 

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(c) If any Lender shall, by exercising any right of set-off or counterclaim or
otherwise, obtain payment in respect of any principal of or interest on any of
its Loans resulting in such Lender receiving payment of a greater proportion of
the aggregate amount of its Loans and accrued interest thereon than the
proportion received by any other Lender, then the Lender receiving such greater
proportion shall purchase (for cash at face value) participations in the Loans
of other Lenders to the extent necessary so that the benefit of all such
payments shall be shared by the Lenders ratably in accordance with the aggregate
amount of principal of and accrued interest on their respective Loans; provided
that (i) if any such participations are purchased and all or any portion of the
payment giving rise thereto is recovered, such participations shall be rescinded
and the purchase price restored to the extent of such recovery, without
interest, and (ii) the provisions of this paragraph shall not be construed to
apply to any payment made by the Borrower pursuant to and in accordance with the
express terms of this Agreement or any payment obtained by a Lender as
consideration for the assignment of or sale of a participation in any of its
Loans to any assignee or participant, other than to the Borrower or any
Subsidiary or Affiliate thereof (as to which the provisions of this paragraph
shall apply). The Borrower consents to the foregoing and agrees, to the extent
it may effectively do so under applicable law, that any Lender acquiring a
participation pursuant to the foregoing arrangements may exercise against the
Borrower rights of set-off and counterclaim with respect to such participation
as fully as if such Lender were a direct creditor of the Borrower in the amount
of such participation.

(d) Unless the Administrative Agent shall have received notice from the Borrower
prior to the date on which any payment is due to the Administrative Agent for
the account of the Lenders hereunder that the Borrower will not make such
payment, the Administrative Agent may assume that the Borrower has made such
payment on such date in accordance herewith and may, in reliance upon such
assumption, distribute to the Lenders the amount due. In such event, if the
Borrower has not in fact made such payment, then each of the Lenders severally
agrees to repay to the Administrative Agent forthwith on demand the amount so
distributed to such Lender with interest thereon, for each day from and
including the date such amount is distributed to it to but excluding the date of
payment to the Administrative Agent, at the greater of the Federal Funds
Effective Rate and a rate determined by the Administrative Agent in accordance
with banking industry rules on interbank compensation.

(e) If any Lender shall fail to make any payment required to be made by it
pursuant to Section 2.06(b), 2.17(d) or 9.03(c), then the Administrative Agent
may, in its discretion (notwithstanding any contrary provision hereof), apply
any amounts thereafter received by the Administrative Agent for the account of
such Lender to satisfy such Lender’s obligations under such Sections until all
such unsatisfied obligations are fully paid.

SECTION 2.18 Mitigation Obligations; Replacement of Lenders. (a) If any Lender
requests compensation under Section 2.14, or if the Borrower is required to pay
any additional amount to any Lender or any Governmental Authority for the
account of any Lender pursuant to Section 2.16, then such Lender shall use
reasonable efforts to designate a different lending office for funding or
booking its Loans hereunder or to assign its rights and obligations

 

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hereunder to another of its offices, branches or affiliates, if, in the judgment
of such Lender, such designation or assignment (i) would eliminate or reduce
amounts payable pursuant to Section 2.14 or 2.16, as the case may be, in the
future and (ii) would not subject such Lender to any unreimbursed cost or
expense and would not otherwise be disadvantageous to such Lender. The Borrower
hereby agrees to pay all reasonable costs and expenses incurred by any Lender in
connection with any such designation or assignment.

(b) If any Lender requests compensation under Section 2.14, or if the Borrower
is required to pay any additional amount to any Lender or any Governmental
Authority for the account of any Lender pursuant to Section 2.16, or if any
Lender defaults in its obligation to fund Loans hereunder, then the Borrower
may, at its sole expense and effort, upon notice to such Lender and the
Administrative Agent, require such Lender to assign and delegate, without
recourse (in accordance with and subject to the restrictions contained in
Section 9.04), all its interests, rights and obligations under this Agreement to
an assignee that shall assume such obligations (which assignee may be another
Lender, if a Lender accepts such assignment); provided that (i) the Borrower
shall have received the prior written consent of the Administrative Agent, which
consent shall not unreasonably be withheld, (ii) such Lender shall have received
payment of an amount equal to the outstanding principal of its Loans, accrued
interest thereon, accrued fees and all other amounts payable to it hereunder,
from the assignee (to the extent of such outstanding principal and accrued
interest and fees) or the Borrower (in the case of all other amounts) and
(iii) such assignment will result in a reduction in such compensation or
payments. A Lender shall not be required to make any such assignment and
delegation if, prior thereto, as a result of a waiver by such Lender or
otherwise, the circumstances entitling the Borrower to require such assignment
and delegation cease to apply.

ARTICLE III.

Representations and Warranties

The Borrower and Holdings each represents and warrants to the Lenders that:

SECTION 3.01 Organization; Powers. Each of Holdings, the Borrower and its
Subsidiaries is duly organized, validly existing and in good standing under the
laws of the jurisdiction of its organization, has all requisite power and
authority to carry on its business as now conducted and, except where the
failure to do so, individually or in the aggregate, could not reasonably be
expected to result in a Material Adverse Effect, is qualified to do business in,
and is in good standing in, every jurisdiction where such qualification is
required.

SECTION 3.02 Authorization; Enforceability. The Transactions are within the
corporate or other organizational powers of each of Holdings, the Borrower and
its Subsidiaries, and have been duly authorized by all necessary corporate or
other organizational and, if required, stockholder action. Each of this
Agreement and the other Loan Documents has been duly executed and delivered by
each of the Loan Parties party thereto and constitutes a legal, valid and
binding obligation of each such Loan Party, enforceable in accordance with its
terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium
or other laws affecting creditors’ rights generally and subject to general
principles of equity, regardless of whether considered in a proceeding in equity
or at law.

 

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SECTION 3.03 Governmental Approvals; No Conflicts. The Transactions (a) do not
require any consent or approval of, registration or filing with, or any other
action by, any Governmental Authority, except such as have been obtained or made
and are in full force and effect, (b) will not violate (i) any applicable law or
regulation or any order of any Governmental Authority except where such
violation, individually or in the aggregate, could not reasonably be expected to
result in a Material Adverse Effect or (ii) the charter, by-laws or other
organizational documents of Holdings, the Borrower or any of its Subsidiaries,
(c) will not violate or result in a default under any indenture, agreement or
other instrument binding upon Holdings, the Borrower or any of its Subsidiaries
or any of their assets, or give rise to a right thereunder to require any
payment to be made by Holdings, the Borrower or any of its Subsidiaries except
where such violation or default, individually or in the aggregate, could not
reasonably be expected to result in a Material Adverse Effect, and (d) will not
result in the creation or imposition of any Lien on any asset of Holdings, the
Borrower or any of its Subsidiaries (other than the Liens granted pursuant to
the Loan Documents).

SECTION 3.04 Financial Condition; No Material Adverse Change. (a) The unaudited
pro forma consolidated balance sheet of Holdings and its consolidated
Subsidiaries as at December 31, 2007 (including the notes thereto) (the “Pro
Forma Balance Sheet”), copies of which have heretofore been furnished to the
Administrative Agent, has been prepared giving effect (as if such events had
occurred on such date) to (i) the Loans to be made on the Closing Date and the
use of proceeds thereof and any other Indebtedness to be issued on the Closing
Date, and (ii) the payment of fees and expenses in connection with the
foregoing. The Pro Forma Balance Sheet has been prepared based on the best
information available to Holdings and the Borrower as of the date of delivery
thereof, and presents fairly in all material respects on a pro forma basis the
estimated financial position of Holdings, the Borrower and its consolidated
Subsidiaries as at December 31, 2007, assuming that the events specified in the
preceding sentence had actually occurred at such date.

(b) The audited consolidated balance sheets of Holdings and its consolidated
Subsidiaries as at December 31, 2005, December 31, 2006 and December 31, 2007,
and the related consolidated statements of income and of cash flows for the
fiscal years ended on such dates, reported on by and accompanied by an
unqualified report from KPMG LLP, present fairly in all material respects the
consolidated financial condition of Holdings and its consolidated Subsidiaries
as at such date, and the consolidated results of its operations and its
consolidated cash flows for the respective fiscal years then ended. The
unaudited consolidated balance sheet of Holdings and its consolidated
Subsidiaries as at March 31, 2008 and the related unaudited consolidated
statements of income and cash flows for the quarter ended on such date, present
fairly in all material respects the consolidated financial condition of the
Borrower and its consolidated Subsidiaries as at such date, and the consolidated
results of its operations and its consolidated cash flows for the quarter then
ended. All such financial statements, including the related schedules and notes
thereto, have been prepared in accordance with GAAP applied consistently
throughout the periods involved (except as approved by the aforementioned firm
of accountants and disclosed therein). None of Holdings, the Borrower or any of
its Subsidiaries has any material Guarantees, contingent liabilities and
liabilities for taxes, or any long-term leases or unusual forward or long-term
commitments, including any interest rate or foreign currency swap or exchange
transaction or other obligation in respect of derivatives, that are not
reflected in the most recent financial statements referred to in this paragraph.
During the period from December 31, 2007 to and including the date hereof there
has been no disposition by any of Holdings, the Borrower or any of its
Subsidiaries of any material part of its business or property.

 

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(c) Since December 31, 2007, there has been no material adverse change in the
business, assets, properties, liabilities (actual and contingent), operations or
financial condition of Holdings, the Borrower and its Subsidiaries, taken as a
whole (other than (i) as shall have been disclosed in Holdings’ and the
Borrowers’ public filings with the Securities and Exchange Commission or (ii) as
otherwise disclosed to the Lenders in writing, in each case prior to the date
hereof).

SECTION 3.05 Litigation. (a) As of the Closing Date, all significant claims,
actions, suits or proceedings by or before any arbitrator or Governmental
Authority pending against or, to the knowledge of Holdings or the Borrower,
threatened against or affecting Holdings, the Borrower or any of its
Subsidiaries are set forth on Schedule 3.05 hereto.

(b) Notwithstanding anything set forth in Section 3.05(a) or Schedule 3.05,
there are no material claims, actions, suits or proceedings by or before any
arbitrator or Governmental Authority pending against or, to the knowledge of
Holdings or the Borrower, threatened against or affecting Holdings, the Borrower
or any of its Subsidiaries (i) as to which there is a reasonable possibility of
an adverse determination that could reasonably be expected, individually or in
the aggregate, to result in a Material Adverse Effect or (ii) that involve this
Agreement or the Transactions.

(c) Since the date of this Agreement, there has been no change in the status of
the matters set forth on Schedule 3.05 that, individually or in the aggregate,
has resulted in, or could reasonably be expected, individually or in the
aggregate, to result in, a Material Adverse Effect.

SECTION 3.06 Compliance with Laws and Agreements. Each of the Borrower and its
Subsidiaries is in compliance with all laws, regulations and orders of any
Governmental Authority applicable to it or its property and all indentures,
agreements and other instruments binding upon it or its property, except where
the failure to do so, individually or in the aggregate, could not reasonably be
expected to result in a Material Adverse Effect. No Default has occurred and is
continuing.

SECTION 3.07 Investment Company Status. Neither Holdings, the Borrower nor any
of its Subsidiaries is an “investment company” as defined in, or subject to
regulation under, the Investment Company Act of 1940.

SECTION 3.08 Taxes. Each of Holdings, the Borrower and its Subsidiaries has
(a) timely filed or caused to be filed all Tax returns and reports required to
have been filed and all such Tax returns and reports are true and correct in all
material respects, and (b) has paid or caused to be paid all material Taxes
required to have been paid by it and all material assessments received by it,
except Taxes that are being contested in good faith by appropriate proceedings
and for which the Borrower or such Subsidiary, as applicable, has set aside on
its books adequate reserves in accordance with GAAP. Each of Holdings, the
Borrower and its Subsidiaries has set aside on its books adequate reserves in
accordance with GAAP for all Taxes not yet due and

 

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payable. Each of Holdings, the Borrower and its Subsidiaries is unaware of any
proposed or pending tax assessments, deficiencies or audits that could be
reasonably expected to, individually or in the aggregate, result in a Material
Adverse Effect.

SECTION 3.09 ERISA. Borrower and each of its ERISA Affiliates are in material
compliance with all applicable provisions and requirements of ERISA and the Code
and the regulations and published interpretations thereunder with respect to
each Plan, and have performed all their obligations under each Plan. Each Plan
which is intended to qualify under Section 401(a) of the Internal Revenue Code
has received a favorable determination letter from the Internal Revenue Service
indicating that such Plan is so qualified and nothing has occurred subsequent to
the issuance of such determination letter which would cause such Plan to lose
its qualified status. No liability to the PBGC (other than required premium
payments), the Internal Revenue Service, any Plan or any trust established under
Title IV of ERISA has been or is expected to be incurred by Borrower or any
ERISA Affiliates. No ERISA Event has occurred or is reasonably expected to
occur. The present value of all accumulated benefit obligations under each Plan
(based on the assumptions used for purposes of Statement of Financial Accounting
Standards No. 87) did not, as of the date of the most recent financial
statements reflecting such amounts, exceed by more than $25,000,000 the fair
market value of the assets of such Plan, and the present value of all
accumulated benefit obligations of all underfunded Plans (based on the
assumptions used for purposes of Statement of Financial Accounting Standards
No. 87) did not, as of the date of the most recent financial statements
reflecting such amounts, exceed by more than $25,000,000 the fair market value
of the assets of all such underfunded Plans. As of the most recent valuation
date for each Multiemployer Plan for which the actuarial report is available,
the potential liability of Borrower and each of its ERISA Affiliates for a
complete withdrawal from such Multiemployer Plan (within the meaning of
Section 4203 of ERISA), when aggregated with such potential liability for a
complete withdrawal from all Multiemployer Plans, based on information available
pursuant to Section 4221(e) of ERISA is $25,000,000. Borrower and each of its
ERISA Affiliates have complied with the requirements of Section 515 of ERISA
with respect to each Multiemployer Plan and are not in material “default” (as
defined in Section 4219(c)(5) of ERISA) with respect to payments to a
Multiemployer Plan. No such Multiemployer Plan is in Reorganization or
Insolvent.

SECTION 3.10 Federal Reserve Regulations. (a) None of Holdings, the Borrower or
any of the Subsidiaries is engaged principally, or as one of its important
activities, in the business of extending credit for the purpose of purchasing or
carrying Margin Stock.

(b) No part of the proceeds of any Loan will be used, whether directly or
indirectly, and whether immediately, incidentally or ultimately, (i) to purchase
or carry Margin Stock or to extend credit to others for the purpose of
purchasing or carrying Margin Stock or to refund indebtedness originally
incurred for such purpose, or (ii) for any purpose that violates the Margin
Regulations.

SECTION 3.11 Title to Properties; Possession Under Leases. (a) Each of Holdings,
the Borrower and its Subsidiaries has good and valid record fee simple title to
(in the case of owned real property), or good title to or valid leasehold
interests in, or easements or other limited property interests in, or has a
license to use, all its real and personal property and assets material to its
business, except for minor defects in title that do not interfere with its
ability to

 

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conduct its business as currently conducted or to utilize such properties and
assets for their intended purposes. All such properties and assets are free and
clear of Liens, other than (in the case of any such properties or assets other
than Equity Interests) Permitted Liens and (in the case of Equity Interests)
Liens referenced in clauses (a), (b), (f) and (g) of the definition of
“Permitted Liens”.

(b) Each of Holdings, the Borrower and its Subsidiaries has complied with all
obligations under all leases to which it is a party, except where the failure to
comply could not reasonably be expected to have a Material Adverse Effect, and
all such leases are in full force and effect, except leases in respect of which
the failure to be in full force and effect could not reasonably be expected to
have a Material Adverse Effect. Each of Holdings, the Borrower and each of its
Subsidiaries enjoys peaceful and undisturbed possession under all such leases,
other than leases in respect of which the failure to enjoy peaceful and
undisturbed possession could not reasonably be expected to have, individually or
in the aggregate, a Material Adverse Effect.

(c) Each of Holdings, the Borrower and its Subsidiaries (i) owns or has a
license to use, on terms not materially adverse to it, all Intellectual Property
and rights with respect thereto necessary for the present conduct of its
business, without any conflict (of which the Borrower has been notified in
writing) with the rights of others, and free from any burdensome restrictions on
the present conduct of its business, except where the failure to own or have a
license to use could not reasonably be expected to have a Material Adverse
Effect and (ii) has taken commercially reasonable steps, consistent with
industry standards, to maintain and protect its Intellectual Property, except
where the failure to maintain and protect any such Intellectual Property could
not reasonably be expected to have a Material Adverse Effect. Neither Holdings,
the Borrower nor any of its Subsidiaries is infringing upon, misappropriating,
diluting or otherwise violating the Intellectual Property rights of any other
Person, except where any such infringement, misappropriation, dilution, or
violation could not reasonably be expected to have, individually or in the
aggregate, a Material Adverse Effect, and there is no pending or threatened
claim or litigation against any of Holdings, the Borrower or its Subsidiaries
alleging any such infringement, misappropriation, dilution or other violation.
With respect to each item of Intellectual Property, each of Holdings, the
Borrower and its Subsidiaries (i) has the right to use and possesses all right,
title and interest in and to such Intellectual Property free and clear of any
Liens, licenses or other restrictions, other than Permitted Liens, and (ii) has
performed all acts (including making all necessary recordations and filings) and
has paid all required fees and taxes to maintain such Intellectual Property in
full force and effect and to protect and maintain its interest therein, except
where the failure to maintain or have the right to use any such Intellectual
Property could not reasonably be expected to have, individually or in the
aggregate, a Material Adverse Effect.

SECTION 3.12 Subsidiaries. Schedule 3.12 sets forth as of the Closing Date the
name and jurisdiction of incorporation, formation or organization of each
Subsidiary of the Borrower and, as to each such Subsidiary, the percentage of
each class of Equity Interests owned by the Borrower or by any such Subsidiary.

SECTION 3.13 Disclosure. Each of Holdings and the Borrower has disclosed to the
Lenders all agreements, instruments and corporate or other restrictions to which
it or any of its Subsidiaries is subject, that, individually or in the
aggregate, could reasonably be expected to

 

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result in a Material Adverse Effect. None of the reports, financial statements,
certificates or other information furnished by or on behalf of Holdings or the
Borrower to the Administrative Agent or any Lender in connection with the
negotiation of this Agreement or delivered hereunder (as modified or
supplemented by other information so furnished) contains any material
misstatement of fact or omits to state any material fact necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading in any material respect; provided that, with respect to
projected financial information, each of Holdings and the Borrower represents
only that such information was prepared in good faith based upon assumptions
believed by it to be reasonable at the time such projections were prepared.

SECTION 3.14 Environmental Matters. (a) Except as to matters that could not
reasonably be expected to have, individually or in the aggregate, a Material
Adverse Effect (i) no written notice, request for information, order, complaint
or penalty has been received by Holdings, the Borrower or any of its
Subsidiaries, and there are no judicial, administrative or other actions, suits
or proceedings pending or threatened which allege a violation of any
Environmental Laws or any other Environmental Liability, in each case relating
to Holdings, the Borrower or any of its Subsidiaries, (ii) each of Holdings, the
Borrower and its Subsidiaries has all environmental permits necessary for its
operations to comply with all applicable Environmental Laws and is, and during
the term of all applicable statutes of limitation, has been, in compliance with
the terms of such permits and with all other applicable Environmental Laws,
(iii) no Hazardous Material is located at any property currently or, to the
knowledge of Holdings, the Borrower or any of its Subsidiaries, formerly owned,
operated or leased by Holdings, the Borrower or any of its Subsidiaries that
would reasonably be expected to give rise to any cost, liability or obligation
of Holdings, the Borrower or any of its Subsidiaries under any Environmental
Laws, and no Hazardous Material has been generated, owned or controlled by
Holdings, the Borrower or any of its Subsidiaries and transported to or released
at any location in a manner that could reasonably be expected to cause Holdings,
the Borrower or any of its Subsidiaries to incur any Environmental Liability,
and (iv) there are no acquisition or other agreements pursuant to which
Holdings, the Borrower or any of its Subsidiaries has expressly assumed or
undertaken responsibility for any Environmental Liability.

(b) Except as set forth on Schedule 3.14 and except with respect to any other
matters that, individually or in the aggregate, could not reasonably be expected
to result in a Material Adverse Effect, neither Holdings, the Borrower nor any
of its Subsidiaries (i) has failed to comply with any Environmental Law or to
obtain, maintain or comply with any permit, license or other approval required
under any Environmental Law, (ii) has become subject to any Environmental
Liability, (iii) has received notice of any claim with respect to any
Environmental Liability or (iv) knows of any basis for any Environmental
Liability.

(c) Since the date of this Agreement, there has been no change in the status of
the matters set forth on Schedule 3.14 that, individually or in the aggregate,
has resulted in, or materially increased the likelihood of, a Material Adverse
Effect.

SECTION 3.15 Security Documents. (a) The Existing Collateral Documents are
effective to create in favor of the Collateral Agent, for the benefit of the New
Secured Parties and the Revolving Credit Facility Secured Parties, a legal,
valid and enforceable security interest in the Existing Collateral described
therein and proceeds thereof to the extent intended to be created

 

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thereby and the security interest of the Collateral Agent for the benefit of the
New Secured Parties and the Revolving Credit Facility Secured Parties shall be
Equally and Ratably secured with the security interest of the Collateral Agent
for the benefit of the Existing Secured Parties (other than GM), and no
intervening Liens other than Permitted Liens shall exist between the date of the
Existing Collateral Documents and the Closing Date.

(b) On or promptly after the Release Date, in accordance with the Collateral and
Guarantee Requirement, the Collateral Agreement shall be effective to create in
favor of the New Collateral Agent, for the benefit of the New Secured Parties
and the Revolving Credit Facility Secured Parties, a legal, valid, enforceable
and perfected security interest in the Collateral and proceeds thereof to the
extent intended to be created thereby, in each case prior and superior in right
to any other person (except, in the case of Collateral other than Pledged
Collateral, Liens expressly permitted by Section 6.02 and Liens having priority
by operation of law).

(c) On or promptly after the Release Date, in accordance with the Collateral and
Guarantee Requirement, the New Collateral Agent, for the benefit of the New
Secured Parties and the Revolving Credit Facility Secured Parties, shall have a
fully perfected Lien on, and security interest in, all right, title and interest
of the Loan Parties thereunder in the domestic Intellectual Property (to the
extent contemplated to be created thereby), in each case prior and superior in
right to any other person (it being understood that subsequent recordings in the
United States Patent and Trademark Office and the United States Copyright Office
may be necessary to perfect a lien on registered trademarks and patents,
trademark and patent applications and registered copyrights acquired by the
grantors after the Closing Date to the extent perfection is not governed by the
UCC) except Liens permitted by Section 6.02 and Liens having priority by
operation of law.

(d) On or promptly after the Release Date, in accordance with the Collateral and
Guarantee Requirement, each Foreign Pledge Agreement shall be effective to
create in favor of the New Collateral Agent, for the benefit of the New Secured
Parties and the Revolving Credit Facility Secured Parties, a legal, valid and
enforceable security interest in the Collateral described therein and proceeds
thereof. In the case of the Pledged Collateral described in a Foreign Pledge
Agreement, when certificates representing such Pledged Collateral are delivered
to the New Collateral Agent on or promptly after the Release Date, the New
Collateral Agent, for the benefit of the New Secured Parties and the Revolving
Credit Facility Secured Parties, shall have a fully perfected Lien on, and
security interest in, all right, title and interest of the Loan Parties in such
Collateral and the proceeds thereof, as security for the Borrower Obligations
and the Guarantees thereof, in each case prior and superior in right to any
other person.

(e) The Borrower Obligations, the Guarantor Obligations and the Revolving Credit
Facility Obligations are Equally and Ratably secured pursuant to the Security
Documents by the same Collateral.

SECTION 3.16 Solvency. (a) Immediately after giving effect to the Transactions
on the Closing Date, (i) the fair value of the assets of each Loan Party, at a
fair valuation, exceeded the debts and liabilities, direct, subordinated,
contingent or otherwise, of such Loan Party; (ii) the present fair saleable
value of the property of each Loan Party was greater than the

 

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amount that will be required to pay the probable liability of such Loan Party,
on its debts and other liabilities, direct, subordinated, contingent or
otherwise, as such debts and other liabilities become absolute and matured;
(iii) each Loan Party will be able to pay its debts and liabilities, direct,
subordinated, contingent or otherwise, as such debts and liabilities become
absolute and matured; and (iv) no Loan Party will have unreasonably small
capital with which to conduct the business in which it is engaged as such
business is now conducted and is proposed to be conducted following the Closing
Date.

(b) No Loan Party intends to, and no Loan Party believes that it will, incur
debts beyond its ability to pay such debts as they mature, taking into account
the timing and amounts of cash to be received by it and the timing and amounts
of cash to be payable on or in respect of its Indebtedness.

ARTICLE IV.

Conditions

SECTION 4.01 Closing Date. The obligations of the Lenders to make Loans on the
Closing Date shall not become effective until the date on which each of the
following conditions is satisfied (or waived in accordance with Section 9.02):

(a) The Administrative Agent (or its counsel) shall have received from each
party hereto either (i) a counterpart of this Agreement signed on behalf of such
party or (ii) written evidence satisfactory to the Administrative Agent (which
may include telecopy transmission of a signed signature page of this Agreement)
that such party has signed a counterpart of this Agreement.

(b) The Administrative Agent shall have received a favorable written opinion
(addressed to the Administrative Agent and the Lenders and dated the Closing
Date) of (i) Hogan & Hartson LLP, counsel for the Borrower, substantially in the
form of Exhibit B, and (ii) other special counsel reasonably satisfactory to the
Administrative Agent, in each case, covering such other matters relating to the
Borrower, this Agreement or the Transactions as the Required Lenders shall
reasonably request. The Borrower hereby requests such counsel to deliver such
opinion.

(c) The Administrative Agent shall have received (i) sufficient copies of each
Organizational Document executed and delivered by each Loan Party, as
applicable, and, to the extent applicable, (A) certified as of the Closing Date
by such Loan Party’s secretary or assistant secretary as being true and complete
copies as in effect on the Closing Date without modification or amendment and
(B) certified as of the Closing Date or a recent date prior thereto by the
appropriate governmental official; (ii) signature and incumbency certificates of
the officers of each Loan Party executing the Loan Documents to which such Loan
Party is a party; (iii) resolutions of the board of directors or similar
governing body of each Loan Party approving and authorizing the execution,
delivery and performance of this Agreement and the other Loan Documents to which
such Loan Party is a party, certified as of the Closing Date by its secretary or
an assistant secretary as being in full force and effect without modification or
amendment; (iv) a certificate of

 

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the secretary or assistant secretary of each Loan Party as to the absence of any
pending proceeding for the dissolution or liquidation of such Loan Party or, to
the knowledge of such person, threatening the existence of such Loan Party;
(v) a good standing certificate from the applicable Governmental Authority of
each Loan Party’s jurisdiction of incorporation, organization or formation and
in each jurisdiction in which it is qualified as a foreign corporation or other
entity to do business, dated a recent date prior to the Closing Date; (vi) a
certificate of another officer of each Loan Party as to the incumbency and
specimen signature of the secretary or assistant secretary executing any
certificate with respect to such Loan Party pursuant to this clause (c); and
(vii) such other documents as Administrative Agent may reasonably request.

(d) The Administrative Agent shall have received a certificate, dated the
Closing Date and signed by the President, a Vice President or a Financial
Officer of the Borrower, confirming compliance with the conditions set forth in
paragraphs (a) and (b) of Section 4.02.

(e) The elements of the Collateral and Guarantee Requirement required to be
satisfied on the Closing Date shall have been satisfied and the Administrative
Agent shall have received a completed Perfection Certificate dated the Closing
Date and signed by a Responsible Officer of each Loan Party, together with all
attachments contemplated thereby, and the results of a search of the Uniform
Commercial Code (or equivalent) filings made with respect to the Loan Parties in
the jurisdictions contemplated by the Perfection Certificate and copies of the
financing statements (or similar documents) disclosed by such search and
evidence reasonably satisfactory to the Administrative Agent that the Liens
indicated by such financing statements (or similar documents) are permitted by
Section 6.02 or have been released.

(f) On or prior to the Closing Date the Borrower shall have delivered to the
Administrative Agent complete, correct and conformed copies of the Senior Notes
Documents.

(g) On the Closing Date, after giving effect to the Transactions and the other
transactions contemplated hereby, the Borrower and its Subsidiaries shall have
outstanding no Indebtedness other than (i) the Loans and other extensions of
credit under this Agreement and (ii) other Indebtedness permitted pursuant to
Section 6.01.

(h) The Lenders shall have received a solvency certificate substantially in the
form of Exhibit D and signed by the Chief Financial Officer of Holdings and the
Borrower confirming the solvency of Holdings and the Borrower after giving
effect to the Transactions.

(i) The Administrative Agent shall have received insurance certificates
satisfying the requirements of Section 5.05 of this Agreement, together with
endorsements naming the Collateral Agent, for the benefit of the New Secured
Parties, as additional insured and loss payee thereunder to the extent required
under Section 5.05.

 

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(j) All material third party approvals necessary in connection with the
Transactions and the continuing operations of the Borrower and its Subsidiaries
shall have been obtained and shall be in full force and effect.

(k) The Administrative Agent shall have received all fees payable thereto or to
any Lender on or prior to the Closing Date and, to the extent invoiced, all
other amounts due and payable pursuant to the Loan Documents on or prior to the
Closing Date, including, to the extent invoiced, reimbursement or payment of all
reasonable out-of-pocket expenses (including reasonable fees, charges and
disbursements of Latham & Watkins LLP and any local counsel) required to be
reimbursed or paid by the Loan Parties hereunder or under any other Loan
Document.

(l) Reserved.

(m) Reserved.

(n) On the Closing Date, the Borrower shall have delivered to the Administrative
Agent complete, correct and executed copies of (x) the fourth amendment to the
Revolving Credit Facility Agreement, (y) the first amendment to the Second Lien
Intercreditor Agreement and (z) the Collateral Agency Agreement, each in form
and substance reasonably satisfactory to the Administrative Agent.

(o) On the Closing Date, the fourth amendment to the Revolving Credit Facility
Agreement, the first amendment to the Second Lien Intercreditor Agreement and
the Collateral Agency Agreement shall have become effective in accordance with
their respective terms and conditions.

(p) The Administrative Agent (or its counsel) shall have received from each
party to the Fee Letter either (i) a counterpart of the Fee Letter signed on
behalf of such party or (ii) written evidence satisfactory to the Administrative
Agent (which may include telecopy transmission of a signed signature page of the
Fee Letter) that such party has signed a counterpart of the Fee Letter.

(q) The Administrative Agent and the Lenders shall have received, at least five
Business Days prior to the Closing Date, all documentation and other information
required by regulatory authorities under applicable “know your customer” and
anti-money laundering rules and regulations, including the Act.

SECTION 4.02 Each Credit Event. The obligation of each Lender to make, convert
or continue a Loan in accordance with Section 2.07 is subject to the
satisfaction of the following conditions:

(a) The representations and warranties set forth in this Agreement and the other
Loan Documents shall be true and correct in all material respects on and as of
the date of such conversion or continuation, as applicable (unless stated to
relate solely to an earlier date, in which case such representations and
warranties shall be true and correct in all material respects as of such earlier
date).

 

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(b) At the time of and immediately after giving effect to such conversion or
continuation, as applicable, no Default shall have occurred and be continuing.

Each conversion and continuation of any Loan shall be deemed to constitute a
representation and warranty by the Borrower on the date thereof as to the
matters specified in paragraphs (a) and (b) of this Section.

ARTICLE V.

Affirmative Covenants

Until the principal of and interest on each Loan and all fees and other amounts
payable hereunder shall have been paid in full, the Borrower covenants and
agrees with the Lenders that:

SECTION 5.01 Financial Statements; and Other Information. The Borrower shall
furnish to the Administrative Agent (for distribution to the Lenders):

(a) within 90 days after the end of each fiscal year of Holdings, Holdings’
audited consolidated balance sheet and related statements of operations,
stockholders’ equity and cash flows as of the end of and for such year, setting
forth in each case in comparative form the figures for the previous fiscal year,
all reported on by KPMG LLP or other independent public accountants of
recognized national standing (without a “going concern” or like qualification or
exception and without any qualification or exception as to the scope of such
audit) to the effect that such consolidated financial statements present fairly
in all material respects the financial condition and results of operations of
the Borrower and its consolidated Subsidiaries on a consolidated basis in
accordance with GAAP consistently applied (it being understood that the delivery
by the Borrower of Annual Reports on Form 10-K of Holdings and its consolidated
Subsidiaries shall satisfy the requirements of this Section 5.01(a) to the
extent such Annual Reports include the information and otherwise satisfy the
requirements specified herein);

(b) within 45 days after the end of each of the first three fiscal quarters of
each fiscal year of Holdings, Holdings’ unaudited consolidated balance sheet and
related statements of operations, stockholders’ equity and cash flows as of the
end of and for such fiscal quarter and the then elapsed portion of the fiscal
year, setting forth in each case in comparative form the figures for the
corresponding period or periods of (or, in the case of the balance sheet, as of
the end of) the previous fiscal year, all certified by one of its Financial
Officers as presenting fairly in all material respects the financial condition
and results of operations of the Borrower and its consolidated Subsidiaries on a
consolidated basis in accordance with GAAP consistently applied, subject to
normal year-end audit adjustments and the absence of footnotes (it being
understood that the delivery by the Borrower of Quarterly Reports on Form 10-Q
of Holdings and its consolidated Subsidiaries shall satisfy the requirements of
this Section 5.01(b) to the extent such Quarterly Reports include the
information and otherwise satisfy the requirements specified herein);

 

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(c) concurrently with any delivery of financial statements under clause (a) or
(b) above, a certificate of a Financial Officer of the Borrower (i) certifying
as to whether a Default has occurred and, if a Default has occurred, specifying
the details thereof and any action taken or proposed to be taken with respect
thereto, (ii) setting forth reasonably detailed calculations demonstrating the
Senior Secured Leverage Ratio and (iii) stating whether any change in GAAP or in
the application thereof has occurred since the date of the audited financial
statements referred to in Section 3.04 and, if any such change has occurred,
specifying the effect of such change on the financial statements accompanying
such certificate;

(d) concurrently with any delivery of financial statements under clause
(a) above, a certificate of the accounting firm that reported on such financial
statements stating whether they obtained knowledge during the course of their
examination of such financial statements of any Default (which certificate may
be limited to the extent required by accounting rules or guidelines);

(e) concurrently with the delivery of financial statements under clause
(a) above, a consolidated budget for the fiscal year following that to which
such financial statements relate as presented to the Board of Directors which
shall include, with respect to the Borrower and its Subsidiaries, ending total
subscribers, gross and net subscriber additions by type, churn by plan, total
revenue, subscription revenue, subscription average revenue per unit (ARPU),
gross margin, subscription margin, research and development expenses,
programming expenses, advertising and marketing expenses, subscriber acquisition
costs, cost per gross and net add, EBITDA (as calculated in the consolidated
budget presented to the Board of Directors), deferred subscription revenue
balance, Indebtedness, cash and capital expenditures;

(f) promptly after the same become publicly available, copies of all periodic
and other reports, proxy statements and other materials filed by Holdings, the
Borrower or any Subsidiary with the Securities and Exchange Commission, or any
Governmental Authority succeeding to any or all of the functions of said
Commission, or with any national securities exchange, as the case may be;

(g) promptly following any request therefor, such other information regarding
the operations, business affairs and financial condition of Holdings, the
Borrower or any Subsidiary, or compliance with the terms of this Agreement, as
the Administrative Agent or any Lender may reasonably request; and

(h) promptly after the request by the Administrative Agent or any Lender all
documentation and other information that such Lender reasonably requests in
order to comply with its ongoing obligations under applicable “know your
customer” and anti-money laundering rules and regulations, including the Act,
with respect to any Loan Party.

SECTION 5.02 Notices of Material Events. The Borrower shall furnish to the
Administrative Agent and each Lender prompt written notice of the following:

(a) the occurrence of any Default;

 

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(b) the filing or commencement of any action, suit or proceeding by or before
any arbitrator or Governmental Authority against or affecting the Borrower or
any Affiliate thereof that could reasonably be expected to result in a Material
Adverse Effect;

(c) the occurrence of any ERISA Event that, alone or together with any other
ERISA Events that have occurred, could reasonably be expected to result in
liability of the Borrower and its Subsidiaries in an aggregate amount exceeding
$10,000,000;

(d) any notice provided to the Collateral Agent under (i)(x) clauses (C),
(E) and (F) of Section 4.1(b), (y) clause (C) of Section 4.2(b), and (z) clause
(B) of Section 4.3(b) of the Existing General Security Agreement,
(ii) Section 9(e) of the Existing FCC License Subsidiary Pledge Agreement and
(iii) each other notice required to be delivered to the Collateral Agent
pursuant to the terms of the Existing Collateral Documents;

(e) (i) without duplication, any notice provided to the Revolving Credit
Facility Administrative Agent under Section 5.02 of the Revolving Credit
Facility Agreement and each other notice required to be delivered by the
Borrower or Holdings to the Revolving Credit Facility Administrative Agent
pursuant to the terms of the Revolving Credit Facility Documents and (ii) any
notice provided by the Borrower or Holdings to the New Collateral Agent under
the Security Documents (other than the Existing Collateral Documents); and

(f) any other development that results in, or could reasonably be expected to
result in, a Material Adverse Effect.

Each notice delivered under this Section shall be accompanied by a statement of
a Financial Officer or other executive officer of the Borrower setting forth the
details of the event or development requiring such notice and any action taken
or proposed to be taken with respect thereto.

SECTION 5.03 Existence; Conduct of Business. The Borrower shall, and shall cause
each of its Material Subsidiaries to, do or cause to be done all things
necessary to preserve, renew and keep in full force and effect its legal
existence and the rights, licenses, permits, privileges and franchises material
to the conduct of its business; provided that the foregoing shall not prohibit
any merger, consolidation, liquidation or dissolution permitted under
Section 6.03.

SECTION 5.04 Obligations and Taxes. The Borrower shall, and shall cause each of
its Material Subsidiaries to, pay its obligations, including material Tax
liabilities, that, if not paid, could reasonably be expected to result in a Lien
(other than a Permitted Lien) on the properties (or any part thereof) of the
Borrower or any of its Material Subsidiaries, or a Material Adverse Effect, in
each case before the same shall become delinquent or in default, except where
(a) the validity or amount thereof is being contested in good faith by
appropriate proceedings, (b) the Borrower or such Material Subsidiary has set
aside on its books adequate reserves with respect thereto in accordance with
GAAP and (c) the failure to make payment pending such contest could not
reasonably be expected to result in a Material Adverse Effect. The Borrower
shall, and shall cause each of its Material Subsidiaries to, timely and
correctly file all Tax returns

 

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and reports required to be filed by it. The Borrower does not intend to treat
the Loans as being a “reportable transaction” within the meaning of Treasury
Regulation Section 1.6011-4. In the event the Borrower determines to take any
action inconsistent with such intention, it will promptly notify the
Administrative Agent thereof.

SECTION 5.05 Maintenance of Properties; Insurance. The Borrower shall, and shall
cause each of its Material Subsidiaries to, (a) keep and maintain all property
material to the conduct of its business in good working order and condition,
ordinary wear and tear excepted, and (b) maintain, with financially sound and
reputable insurance companies, insurance in such amounts and against such risks
as are customarily maintained by companies engaged in the same or similar
businesses operating in the same or similar locations; provided that satellite
insurance shall not be required. Each such policy of insurance shall (i) name,
prior to the Release Date, the Collateral Agent, and at all times on and after
the Release Date, the New Collateral Agent, on behalf of the New Secured Parties
and the Revolving Credit Facility Secured Parties, as an additional insured
thereunder as its interests may appear, (ii) in the case of each casualty
insurance policy, contain a loss payable clause or endorsement, satisfactory in
form and substance to the New Collateral Agent, that names, prior to the Release
Date, the Collateral Agent, and at all times on and after the Release Date, the
New Collateral Agent, on behalf of the New Secured Parties and the Revolving
Credit Facility Secured Parties, as the loss payee thereunder and (iii) provide
for at least thirty days’ prior written notice to the Administrative Agent and
the New Collateral Agent of any modification or cancellation of such policy. The
Borrower shall, and shall cause each of its Material Subsidiaries to, use
commercially reasonable efforts, consistent with industry standards, to
prosecute, maintain, and enforce all Intellectual Property owned or held by the
Borrower or its Material Subsidiaries that is material to the conduct of its
business.

SECTION 5.06 Books and Records; Inspection Rights. The Borrower shall, and shall
cause each of its Material Subsidiaries to, keep proper books of record and
account in which full, true and correct entries are made of all dealings and
transactions in relation to its business and activities. The Borrower shall, and
shall cause each of its Material Subsidiaries to, permit any representatives
designated by the Administrative Agent or any Lender, upon reasonable prior
notice, to visit and inspect its properties, to examine and make extracts from
its books and records, and to discuss its affairs, finances and condition with
its officers and independent accountants, all at such reasonable times and as
often as reasonably requested. If such visit and inspection occurs at a time
when no Default has occurred and is continuing, such visit and inspection by the
Administrative Agent or any Lender shall be coordinated through the
Administrative Agent and shall be limited to one visit and inspection during any
consecutive twelve-month period.

SECTION 5.07 Compliance with Laws. The Borrower shall, and shall cause each of
its Material Subsidiaries to, comply with all laws, rules, regulations and
orders of any Governmental Authority applicable to it or its property, except
where the failure to do so, individually or in the aggregate, could not
reasonably be expected to result in a Material Adverse Effect.

 

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SECTION 5.08 Use of Proceeds. The proceeds of the Loans will be used solely to
finance the working capital needs and general corporate purposes of the Borrower
and its Subsidiaries and to provide cash collateral to support the issuance of
letters of credit.

SECTION 5.09 Compliance with Environmental Laws. The Borrower shall, and shall
cause each of its Material Subsidiaries to, comply with all Environmental Laws
applicable to its operations and properties; and obtain and renew all
authorizations and permits required pursuant to Environmental Law for its
operations and properties, in each case in accordance with Environmental Laws,
except, in each case with respect to this Section 5.09, to the extent the
failure to do so could not reasonably be expected to have, individually or in
the aggregate, a Material Adverse Effect.

SECTION 5.10 Further Assurances. (a) The Borrower shall, and shall cause each of
the Subsidiary Loan Parties to, execute any and all further documents, financing
statements, agreements and instruments, and take all such further actions
(including the filing and recording of financing statements and other documents
and recordings of Liens in stock registries), that may be required under any
applicable law or the Security Documents, or that the Administrative Agent may
reasonably request, to cause the Collateral and Guarantee Requirement to be and
remain satisfied, all at the expense of the Loan Parties, and provide to the
Administrative Agent, from time to time upon reasonable request, evidence
reasonably satisfactory to the Administrative Agent as to the perfection and
priority of the Liens created or intended to be created by the Security
Documents; provided that, until the Release Date, such actions with respect to
perfection shall be limited to the requirements set forth in the Existing
Collateral Documents. The Borrower shall deliver to the Administrative Agent on
the Release Date an updated Perfection Certificate dated the Release Date and
signed by a Responsible Officer of the Borrower, together with all attachments
contemplated thereby.

(b) If any asset that has an individual fair market value in an amount greater
than $5,000,000 million is created, developed or acquired by the Borrower or any
other Subsidiary Loan Party after the Closing Date or owned by an entity at the
time it becomes a Subsidiary Loan Party (in each case other than assets
constituting Collateral under a Security Document that become subject to the
Lien of such Security Document upon acquisition thereof or that are not required
to become subject to the Liens of the Administrative Agent pursuant to the
Security Documents), the Borrower shall, and shall cause the Subsidiary Loan
Parties to, cause such asset, on or promptly after the acquisition thereof, to
be subjected to a Lien securing the Borrower Obligations and the Guarantor
Obligations of such Subsidiary Loan Party, as applicable, and shall take, and
shall cause the Subsidiary Loan Parties to take, such actions as shall be
necessary or reasonably requested by the Administrative Agent to grant and
perfect such Liens, including actions described in paragraph (a) of this
Section, all at the expense of the Loan Parties, provided that, until the
Release Date, such actions with respect to perfection shall be limited as set
forth in the Existing Collateral Documents.

(c) If any newly formed or acquired or any existing direct or indirect
Subsidiary of the Borrower becomes a Subsidiary Loan Party, within ten Business
Days after the date such Subsidiary becomes a Subsidiary Loan Party, the
Borrower shall notify the Administrative Agent and the Lenders thereof and,
within 20 Business Days after such date or such longer period as the
Administrative Agent shall agree, the Borrower shall, and shall cause

 

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its Subsidiaries to, cause the Collateral and Guarantee Requirement to be
satisfied with respect to such Subsidiary and with respect to any Equity
Interest in or Indebtedness of such Subsidiary owned by or on behalf of any Loan
Party, provided that, until the Release Date, such actions with respect to
perfection shall be limited as set forth in the Existing Collateral Documents.

(d) If any newly formed or acquired or any existing Subsidiary of the Borrower
becomes a Foreign Subsidiary, within ten Business Days after the date such
Subsidiary becomes a Foreign Subsidiary, the Borrower shall notify the
Administrative Agent and the Lenders thereof and, within 20 Business Days after
such date or such longer period as the Administrative Agent shall agree, the
Borrower shall, and shall cause its Subsidiaries to, cause the Collateral and
Guarantee Requirement to be satisfied with respect to any Equity Interest in
such Subsidiary owned by or on behalf of any Loan Party, provided that, until
the Release Date, such actions with respect to perfection shall be limited as
set forth in the Existing Collateral Documents.

(e) (i) The Borrower shall furnish to the Administrative Agent prompt written
notice of any change (A) in any Loan Party’s corporate or organization name,
(B) in any Loan Party’s identity or organizational structure, (C) in any Loan
Party’s organizational identification number, (D) in any Loan Party’s
jurisdiction of organization or (E) in any Loan Party’s chief executive office
or sole place of business, in each case from that set forth on Schedule 3.17;
provided that the Borrower shall not effect or permit any such change unless all
filings have been made, or will have been made within any statutory period,
under the Uniform Commercial Code or otherwise that are required in order for
(x) prior to the Release Date, the Collateral Agent, for the benefit of the
Existing Secured Parties and the New Secured Parties, and (y) on or after the
Release Date, the New Collateral Agent, for the benefit of the New Secured
Parties and the Revolving Credit Facility Secured Parties, to continue at all
times following such change to have a valid, legal and perfected security
interest in all the Collateral in accordance with Security Documents and
(ii) the Borrower shall, and shall cause its Subsidiaries to, promptly notify
the Collateral Agent, the New Collateral Agent and the Administrative Agent to
the extent it becomes aware (A) of any material portion of the Collateral being
damaged or destroyed, (B) of any Lien (other than any Permitted Lien) on any
Collateral which would have a material adverse affect on the ability of any of
the Collateral Agent, the New Collateral Agent or the Administrative Agent to
exercise any of its remedies under the Loan Documents and (C) of the occurrence
of any other event which could reasonably be expected to have a Material Adverse
Effect on the security interest created by the Security Documents.

(f) The Collateral and Guarantee Requirement and the other provisions of this
Section 5.10 need not be satisfied with respect to (i) any Equity Interests
acquired after the Closing Date in accordance with this Agreement if, and to the
extent that, and for so long as (A) doing so would violate applicable law or a
contractual obligation binding on the holder of such Equity Interests and
(B) such law or obligation existed at the time of the acquisition thereof and
was not created or made binding on such Equity Interests in contemplation of or
in connection with the acquisition of such Subsidiary, (ii) any assets acquired
after the Closing Date, to the extent that, and for so long as, taking such
actions would violate a contractual obligation binding on such assets that
existed at the time of the acquisition thereof and was not created or made
binding on such assets in contemplation or in connection with the acquisition of
such assets (except in the case of assets acquired with Indebtedness permitted
pursuant to Section 6.01(b)(v)

 

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that is secured by a Lien permitted pursuant to clause (e) of the definition of
Permitted Lien (to the extent such clause (e) refers to Section 6.01(b)(v))) or
(iii) any asset with respect to which the Administrative Agent reasonably
determines that the cost of the satisfaction of the provisions of this
Section 5.10 with respect thereto exceeds the value of the security afforded
thereby; provided that, upon the reasonable request of the Administrative Agent,
the Borrower shall, and shall cause any applicable Subsidiary to, use
commercially reasonable efforts to have waived or eliminated any contractual
obligation of the types described in clauses (i) and (ii) above.

(g) From time to time execute and deliver, or cause to be executed and
delivered, such additional instruments, certificates or documents, and take all
such actions, as the Administrative Agent may reasonably request for the
purposes of implementing or effectuating the provisions of this Agreement and
the other Loan Documents, or of more fully perfecting or renewing the rights or
ensuring the priority of the Collateral Agent on behalf of the Existing Secured
Parties and the New Secured Parties and/or the New Collateral Agent on behalf of
the New Secured Parties and the Revolving Credit Facility Secured Parties with
respect to the Collateral (or with respect to any additions thereto or
replacements or proceeds thereof or with respect to any other property or assets
hereafter acquired by the borrower or any Subsidiary which may be deemed to be
part of the Collateral) pursuant hereto or thereto, provided that, until the
Release Date, such actions with respect to perfection shall be limited as set
forth in the Existing Collateral Documents. Upon the exercise by the
Administrative Agent or any Lender of any power, right, privilege or remedy
pursuant to this Agreement or the other Loan Documents which requires any
consent, approval, recording qualification or authorization of any Governmental
Authority, the Borrower will execute and deliver, or will cause the execution
and delivery of, all applications, certifications, instruments and other
documents and papers that the Administrative Agent or such Lenders may be
required to obtain from the Borrower or any of its Subsidiaries for such
governmental consent, approval, recording, qualification or authorization.

(h) Notwithstanding anything to the contrary herein, the Administrative Agent
and/or the New Collateral Agent shall have the right to file such financing
statements and amendments and continuations thereof as it deems reasonably
necessary to ensure that as of the Release Date the Liens created by the
Security Documents with respect to the Borrower Obligations and the Guarantor
Obligations have the same priority as they would have had had they been
executed, and filings in respect thereof had been made, as of the Revolving
Credit Facility Closing Date.

ARTICLE VI.

Negative Covenants

Until the principal of and interest on each Loan and all fees and other amounts
payable hereunder shall have been paid in full, the Borrower covenants and
agrees with the Lenders that:

SECTION 6.01 Incurrence of Indebtedness and Issuance of Disqualified Stock.
(a) Except as provided in clause (b) of this Section 6.01 the Borrower shall
not, and shall not permit any of its Material Subsidiaries to, directly or
indirectly, create, incur, issue, assume, guarantee or otherwise become directly
or indirectly liable, contingently or otherwise, with respect to (collectively,
“incur”) any Indebtedness (including Acquired Debt), and the Borrower shall not
issue any Disqualified Stock.

 

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(b) Clause (a) of this Section 6.01 shall not apply to the incurrence of any of
the following items of Indebtedness (collectively, “Permitted Debt”):

(i) the incurrence by the Borrower or any Material Subsidiary of unsecured
Indebtedness in an aggregate principal amount (including the aggregate principal
amount of all Permitted Refinancing Indebtedness incurred to refund, refinance
or replace any Indebtedness incurred pursuant to this clause (i)) which does not
exceed, as of the date of such incurrence, at any time outstanding $500,000,000;
provided that such Indebtedness shall have (A) a final Stated Maturity of
principal at least six months later than the Maturity Date (or, in the case of a
letter of credit, an expiry date at least six months later than the Maturity
Date) and (B) a Weighted Average Life to Maturity longer than the Weighted
Average Life to Maturity of the Loans; provided, further that no draw under a
letter of credit by the beneficiary thereof (and resulting reimbursement
obligation of the Borrower or any of its Material Subsidiaries in respect
thereof) prior to such date shall be considered a violation of the requirement
set forth in this clause (i) regarding the final Stated Maturity thereof;

(ii) unsecured subordinated Indebtedness or Disqualified Stock of the Borrower
in an aggregate principal amount (or liquidation preference, as applicable)
(including the aggregate principal amount (or liquidation preference, as
applicable) of all Permitted Refinancing Indebtedness incurred to refund,
refinance or replace any Indebtedness or Disqualified Stock, as applicable,
incurred pursuant to this subclause (iii)) at any time outstanding not to exceed
the product of (a) $100.00 and (b) the number of Subscribers at such time;
provided that such subordinated Indebtedness or Disqualified Stock, as
applicable, shall have a Weighted Average Life to Maturity longer than the
Weighted Average Life to Maturity of the Loans and a final Stated Maturity of
principal at least six months later than the Maturity Date;

(iii) the incurrence by the Borrower and its Material Subsidiaries of (x) the
Existing Indebtedness, including pursuant to the January 2003 Financing
Transactions (other than the borrowings described in clause (c) of the
definition thereof) and (y) Indebtedness under the Distribution and Credit
Agreement in an aggregate principal amount not to exceed $150,000,000 (provided
that Indebtedness incurred under the Distribution and Credit Agreement prior to
the Closing Date that is repaid with proceeds of the Loans promptly, and in any
event not later than ten Business Days, following the Closing Date shall not
count against this $150,000,000 amount);

(iv) the incurrence by the Borrower and any Subsidiary Loan Party of
Indebtedness represented by the New Senior Notes and any Guarantees thereof and
any exchange notes and Guarantees thereof to be issued pursuant to the
Registration Rights Agreement;

(v) the incurrence by the Borrower or any Material Subsidiary of Indebtedness
represented by Capital Lease Obligations, mortgage financings or purchase

 

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money obligations, in each case, incurred for the purpose of financing all or
any part of the purchase price or cost of acquisition, construction or
improvement of property, plant or equipment used in the business of the Borrower
or such Subsidiary, or of Indebtedness in connection with a sale and leaseback
transaction permitted by Section 6.05(b), in an aggregate principal amount
(and/or amount of Attributable Debt, as applicable), including all Permitted
Refinancing Indebtedness incurred to refund, refinance or replace any
Indebtedness incurred pursuant to this subclause (v), not to exceed $100,000,000
at any time outstanding;

(vi) the incurrence by the Borrower or any Subsidiary Loan Party, or Material
Subsidiary as applicable, of Permitted Refinancing Indebtedness in exchange for,
or the net proceeds of which are used to refund, refinance or replace,
Indebtedness (other than intercompany Indebtedness or the Existing 10% Notes)
that was permitted to be incurred under subclauses (i), (ii), (iii), (iv), (v),
(x), (xi), (xii), (xiii) or (xvi) of this clause (b);

(vii) the incurrence by the Borrower or any Material Subsidiary of intercompany
Indebtedness between or among the Borrower and any Subsidiary; provided,
however, that:

(A) if the Borrower or any Material Subsidiary is the obligor on such
Indebtedness, such Indebtedness must be expressly subordinated to the prior
payment in full in cash of all Borrower Obligations and Guarantor Obligations;
and

(B) (1) any subsequent issuance or transfer of Equity Interests that results in
any such Indebtedness being held by a Person other than the Borrower or a
Subsidiary thereof and (2) any sale or other transfer of any such Indebtedness
to a Person that is not either the Borrower or a Subsidiary thereof, shall be
deemed, in each case, to constitute an incurrence of such Indebtedness by the
Borrower or such Material Subsidiary, as the case may be, that was not permitted
by this subclause (vii);

(viii) the incurrence by the Borrower or any Material Subsidiary of Hedging
Obligations incurred in the ordinary course of business;

(ix) the accrual of interest, the accretion or amortization of original issue
discount, the payment of interest on any Indebtedness in the form of additional
Indebtedness with the same terms, and the payment of dividends on Disqualified
Stock in the form of additional shares of the same class of Disqualified Stock
shall not be deemed to be an incurrence of Indebtedness or an issuance of
Disqualified Stock for purposes of this Section 6.01;

(x) Indebtedness the proceeds of which are utilized solely to finance working
capital in an aggregate principal amount at any time outstanding, including all
Permitted Refinancing Indebtedness incurred to refund, refinance or replace any
Indebtedness incurred pursuant to this subclause (x), not to exceed the lesser
of (A) $50,000,000 and (B) 80% of Qualified Receivables;

 

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(xi) from and after any Parent Company Merger, Indebtedness of Holdings in
existence on the Revolving Credit Facility Closing Date;

(xii) any Qualified Sale and Leaseback Transaction, including an XM-4 Sale and
Leaseback Transaction, and any Permitted Beneficial Interest Indebtedness;

(xiii) Satellite Vendor Indebtedness;

(xiv) any Indebtedness incurred hereunder and the Guarantee of such
Indebtedness;

(xv) the incurrence by the Borrower of one or more MLB Letters of Credit in an
aggregate face amount not to exceed $120,000,000 at any time for all such MLB
Letters of Credit;

(xvi) the incurrence by the Borrower and each other Loan Party of the Revolving
Credit Facility Obligations in an aggregate principal amount not to exceed
$250,000,000 at any time; and

(xvii) the incurrence by the Borrower or any Material Subsidiary of unsecured
Indebtedness undertaken in connection with the Merger or any Merger Related
Event (including without limitation in connection with a change of control offer
to security holders of the Borrower, any Material Subsidiary or Holdings, a
change of control offer in connection with an XM-4 Sale and Leaseback
Transaction or a waiver of any such change of control offer or right to receive
the same), other than or in addition to Permitted Refinancing Indebtedness
incurred for such purpose, in an aggregate principal amount (including the
aggregate principal amount of all Permitted Refinancing Indebtedness incurred to
refund, refinance or replace any Indebtedness incurred pursuant to this clause
(xvii)) which does not exceed, as of the date of such incurrence, at any time
outstanding $100,000,000; provided that such Indebtedness shall have a final
Stated Maturity of principal at least six months later than the Maturity Date
and a Weighted Average Life to Maturity longer than the Weighted Average Life to
Maturity of the Loans.

(c) The Borrower shall not incur any Indebtedness (including Permitted Debt)
that is contractually subordinated in right of payment to any other Indebtedness
of the Borrower unless such Indebtedness is also contractually subordinated in
right of payment to the Credit Agreement Obligations on substantially identical
terms; provided, however, that no Indebtedness of the Borrower shall be deemed
to be contractually subordinated in right of payment to any other Indebtedness
of the Borrower solely by virtue of being unsecured.

For purposes of determining compliance with this Section 6.01, in the event that
an item of Indebtedness meets the criteria of more than one of the categories of
Permitted Debt described in clauses (i) through (xiv) above, the Borrower may,
in its sole discretion, classify such item of Indebtedness in any manner that
complies with this Section, and such item of Indebtedness will be treated as
having been incurred pursuant to only one of such clauses.

 

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SECTION 6.02 Liens. The Borrower shall not, and shall not permit any of its
Material Subsidiaries to, create, incur, assume or otherwise cause or suffer to
exist or become effective any Lien of any kind upon any of their property or
assets, whether now owned or hereafter acquired, other than Permitted Liens;
provided that no Permitted Lien (other than those set forth in clauses (q),
(x) (but only to the extent such Lien is in connection with Permitted
Refinancing Indebtedness in respect of Indebtedness permitted under
Section 6.01(b)(xvi)) and (bb) of the definition thereof and those securing the
Secured Notes outstanding on the Closing Date) shall rank Equally and Ratably
with the Liens securing the Credit Agreement Obligations and the Guarantor
Obligations and no holder of Obligations secured by any Permitted Lien (other
than those set forth in clauses (q), (x) (but only to the extent such Lien is in
connection with Permitted Refinancing Indebtedness in respect of Indebtedness
permitted under Section 6.01(b)(xvi)) and (bb) of the definition thereof and
those securing the Secured Notes outstanding on the Closing Date) shall be
permitted to constitute an Additional Creditor or Secured Party (in each case,
under and as defined in the Existing Collateral Documents) or an Additional
Secured Debtholder or Secured Party (under and as defined in the Collateral
Agency Agreement and the Collateral Agreement).

SECTION 6.03 Merger, Consolidation or Sale of Assets. (a) The Borrower shall not
consolidate or merge with or into (whether or not the Borrower is the surviving
corporation), or sell, assign, transfer, convey or otherwise dispose of all or
substantially all of the properties or assets of the Borrower and its Material
Subsidiaries taken as a whole, in one or more related transactions to, another
Person unless:

(i) the Borrower is the surviving corporation or the Person formed by or
surviving any such consolidation or merger (if other than the Borrower) or to
which such sale, assignment, transfer, conveyance or other disposition shall
have been made is a corporation organized or existing under the laws of the
United States, any state thereof or the District of Columbia;

(ii) the Person formed by or surviving any such consolidation or merger (if
other than the Borrower) or the Person to which such sale, assignment, transfer,
conveyance or other disposition shall have been made assumes all the Borrower
Obligations pursuant to agreements in a form reasonably satisfactory to the
Administrative Agent;

(iii) immediately after such transaction, no Default or Event of Default exists;

(iv) the Borrower or the Person formed by or surviving any such consolidation or
merger (if other than the Borrower), or to which such sale, assignment,
transfer, conveyance or other disposition shall have been made will have
Consolidated Net Worth immediately after the transaction equal to or greater
than the Consolidated Net Worth of the Borrower immediately preceding the
transaction; and

 

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(v) in the case of a sale, assignment, transfer, conveyance or other disposition
of all or substantially all of the properties or assets of the Borrower and its
Material Subsidiaries, taken as a whole, in one or more related transactions,
the Liens on such properties and assets for the benefit of the New Secured
Parties to secure the Borrower Obligations and the Guarantor Obligations shall
not be released and shall continue in full force and effect after giving effect
to such transactions or transactions.

In addition, the Borrower shall not, and shall not permit its Material
Subsidiaries to, lease all or substantially all of its properties or assets, in
one or more related transactions, to any other Person. This Section 6.03(a)
shall not apply to (x) a consolidation, merger, sale, assignment, transfer,
conveyance or other disposition of properties or assets between or among the
Borrower and any of its Wholly Owned Subsidiary Guarantors or (y) the Parent
Company Merger.

(b) The Borrower shall not, and shall not permit its Material Subsidiaries to,
engage in any Asset Sale (other than any Asset Sale otherwise permitted under
clause (a) of this Section) except for (1) the disposition of assets having a
fair market value not to exceed (x) $50,000,000 in the aggregate for any fiscal
year of the Borrower (provided that (i) any such amount, if not so used in the
fiscal year for which it is permitted, may be carried over for use in the next
succeeding fiscal year and (ii) Asset Sales made pursuant to this clause
(1) during any fiscal year shall be deemed made, first, in respect of amounts
carried over from the prior fiscal year pursuant to subclause (i) hereof and,
second, in respect of amounts permitted for such fiscal year as provided above)
and (y) $150,000,000 in the aggregate since the Revolving Credit Facility
Closing Date; and (2) the sale or other disposition of surplus repeaters;
provided that, in each case and notwithstanding the foregoing, (i) any such
Asset Sale shall be for consideration at least 75% of which is in the form of
cash or Cash Equivalents, (ii) such consideration shall be at least equal to the
fair market value of the assets or Equity Interests being issued, sold,
transferred, leased or otherwise disposed of, (iii) such fair market value shall
be determined in good faith by the board of directors of the Borrower and
evidenced by a board resolution evidenced in an officer’s certificate delivered
to the Administrative Agent, and (iv) the Borrower shall have applied any Excess
Proceeds therefrom in accordance with Sections 2.10(c) and (e). For purposes of
this clause (b), each of the following shall be deemed to be cash: (1) any
liabilities (as shown on the Borrower’s or any Material Subsidiary’s most recent
balance sheet or in the notes thereto) of the Borrower or any Material
Subsidiary (other than contingent liabilities and liabilities that are by their
terms subordinated to the Credit Agreement Obligations or any Guarantee thereof)
that are assumed by the transferee of any such assets pursuant to a customary
novation agreement that releases the Borrower or such Material Subsidiary from
further liability; (2) any securities, notes or other obligations received by
the Borrower or any Material Subsidiary from such transferee that are converted
by the Borrower or such Material Subsidiary into cash (to the extent of the cash
received in that conversion) within 30 days of the receipt thereof; and (3) any
Equity Interests (to the extent the acquisition thereof constitutes a Permitted
Investment under clause (l) of the definition thereof).

SECTION 6.04 Dividend and Other Payment Restrictions Affecting Material
Subsidiaries. (a) The Borrower shall not, and shall not permit any of its
Material Subsidiaries to, directly or indirectly, create or permit to exist or
become effective any consensual encumbrance or restriction on the ability of any
Material Subsidiary to:

(i) pay dividends or make any other distributions on its Equity Interests to the
Borrower or any of its Material Subsidiaries or with respect to any other
interest or participation in, or measured by, its profits, or pay any
Indebtedness owed to the Borrower or any of its Material Subsidiaries;

 

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(ii) make loans or advances to the Borrower or any of its Material Subsidiaries;

(iii) transfer any of its properties or assets to the Borrower or any of its
Material Subsidiaries; or

(iv) guarantee any Indebtedness of the Borrower or any of its Material
Subsidiaries;

(b) Notwithstanding the foregoing, the restrictions in the preceding clause
(a) shall not apply to encumbrances or restrictions existing under or by reason
of:

(i) Existing Indebtedness (including the New Senior Notes and the Revolving
Credit Facility Obligations) as in effect on the Closing Date and, with respect
to any such Indebtedness other than the Existing 10% Notes, any amendments,
modifications, restatements, renewals, increases, supplements, refundings,
replacements or refinancings thereof, provided that such amendments,
modifications, restatements, renewals, increases, supplements, refundings,
replacements or refinancings are no more restrictive, taken as a whole, with
respect to such dividend and other payment restrictions than those contained in
such Existing Indebtedness, as in effect on the Closing Date;

(ii) the Loan Documents;

(iii) applicable law;

(iv) any instrument governing Indebtedness or Equity Interests of a Person
acquired by the Borrower or any of its Material Subsidiaries as in effect at the
time of such acquisition (except to the extent such Indebtedness was incurred in
connection with or in contemplation of such acquisition), which encumbrance or
restriction is not applicable to any Person, or the properties or assets of any
Person, other than the Person, or the property or assets of the Person, so
acquired; provided that, in the case of Indebtedness, such Indebtedness was
permitted by this Agreement to be incurred;

(v) customary non-assignment provisions in leases or contracts or real property
mortgages or related documents entered into in the ordinary course of business
and consistent with past practices;

(vi) purchase money obligations, Capital Lease Obligations or mortgage
financings that impose restrictions on the property so acquired of the nature
described in clause (a)(iii) hereto or Pari Passu Indebtedness incurred pursuant
to Section 6.01(b)(i);

 

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(vii) any agreement for the sale or other disposition of a Material Subsidiary
that restricts distributions by that Subsidiary pending its sale or other
disposition;

(viii) Permitted Refinancing Indebtedness; provided that the restrictions
contained in the agreements governing such Permitted Refinancing Indebtedness
are no more restrictive, taken as a whole, than those contained in the
agreements governing the Indebtedness being refinanced;

(ix) Liens securing Indebtedness that limit the right of the debtor to dispose
of the assets subject to such Lien;

(x) provisions with respect to the disposition or distribution of assets or
property in joint venture agreements, asset sale agreements, stock sale
agreements and other similar agreements entered into in the ordinary course of
business; and

(xi) restrictions on cash or other deposits or net worth imposed by customers
under contracts entered into in the ordinary course of business.

SECTION 6.05 Sale and Leaseback Transactions. The Borrower shall not, and shall
not permit any of its Material Subsidiaries to, enter into any sale and
leaseback transaction (other than a sale and leaseback transaction between the
Borrower and one or more of its Material Subsidiaries that are not Subsidiary
Loan Parties or among Material Subsidiaries that are not Subsidiary Loan
Parties) other than (a) a Qualified Sale and Leaseback Transaction, including an
XM-4 Sale and Leaseback Transaction or, (b) a sale and leaseback transaction
where:

(1) the Borrower or such Material Subsidiary could have incurred Indebtedness in
an amount equal to the Attributable Debt relating to such sale and leaseback
transaction under clause (b)(v) of Section 6.01 and any Lien to secure such
Indebtedness is permitted under Section 6.02;

(2) the gross cash proceeds of that sale and leaseback transaction are at least
equal to the fair market value, as determined in good faith by the Board of
Directors of the Borrower and set forth in an officers’ certificate delivered to
the Administrative Agent, of the property that is the subject of that sale and
leaseback transaction; and

(3) the transfer of assets in that sale and leaseback transaction is permitted
by Section 6.03, and the Borrower applies the Net Proceeds of such transaction
in accordance with Sections 2.10(c) and (e).

SECTION 6.06 Restricted Payments. (a) The Borrower shall not, and shall not
permit any of its Material Subsidiaries to:

(1) declare or pay any dividend or make any other payment or distribution on
account of the Borrower’s Equity Interests (including, without limitation, any
payment in connection with any merger or consolidation involving the Borrower)
or to the direct or indirect holders of the Borrower’s Equity Interests in their
capacity as such (other than

 

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dividends or distributions payable in Equity Interests (other than Disqualified
Stock) of the Borrower and cash in lieu of fractional interests not to exceed 1%
of the Equity Interests distributed or paid);

(2) other than pursuant to a Parent Company Merger, purchase, redeem or
otherwise acquire or retire for value (including, without limitation, in
connection with any merger or consolidation involving the Borrower) any Equity
Interests of the Borrower (other than any such Equity Interests owned by the
Borrower or any of its Material Subsidiaries) or any Affiliate of the Borrower
(other than any of its Material Subsidiaries);

(3) make any payment on or with respect to, or purchase, redeem, defease or
otherwise acquire or retire for value any Indebtedness that is subordinated in
right of payment to the Borrower Obligations or any Guarantees thereof except,
in each case, a payment of interest or principal at the Stated Maturity thereof;
or

(4) make any Restricted Investment (all such payments and other actions set
forth in clauses (1) through (4) above being collectively referred to as
“Restricted Payments”), unless:

(i) at the time of and after giving effect to such Restricted Payment, no
Default or Event of Default shall have occurred and be continuing or would occur
as a consequence thereof; and

(ii) such Restricted Payment, together with the aggregate amount of all other
Restricted Payments made by the Borrower and its Material Subsidiaries after the
Revolving Credit Facility Closing Date (excluding Restricted Payments permitted
by subclauses (ii), (iii), (iv), (v), (vi), (vii), (viii), (ix), (x), (xii),
(xiii) and (xiv) of clause (b) of this Section 6.06), is less than
(x) $20,000,000 in any fiscal year of the Borrower (provided that (i) any such
amount, if not so used in the fiscal year for which it is permitted, may be
carried over for use in the next succeeding fiscal year and (ii) Restricted
Payments made pursuant to this clause (ii)(x) during any fiscal year shall be
deemed made, first, in respect of amounts permitted for such fiscal year as
provided above and, second, in respect of amounts carried over from the prior
fiscal year pursuant to subclause (i) hereof) and (y) $60,000,000 since the
Revolving Credit Facility Closing Date.

(b) Clause (a) of this Section 6.06 shall not prohibit, so long as no Default
has occurred and is continuing or would be caused thereby:

(i) the payment of any dividend or other distribution within 60 days after the
date of declaration thereof, if at said date of declaration such payment would
have complied with the provisions of this Agreement, and such payment will be
deemed to have been paid on the date of declaration for purposes of the
calculation in clause (a)(4)(ii);

(ii) the redemption, repurchase, retirement, defeasance or other acquisition of
any subordinated Indebtedness of the Borrower or of any of the Borrower’s Equity
Interests in exchange for, or out of the net cash proceeds of the sale, which
sale shall have occurred within 90 days of the date of any such redemption,
repurchase, retirement, defeasance

 

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or other acquisition, (other than to a Material Subsidiary of the Borrower) of,
the Borrower’s Equity Interests (other than Disqualified Stock) and cash
payments in lieu of fractional interests not to exceed 1% of the Equity
Interests so redeemed, repurchased, retired, defeased or otherwise acquired;

(iii) the purchase, redemption, defeasance or other acquisition or retirement
for value of subordinated Indebtedness of the Borrower in exchange for, or out
of the net cash proceeds of an incurrence, which incurrence shall have occurred
within 90 days of the date of any such purchase, redemption, defeasance or other
acquisition or retirement for value, (other than to a Material Subsidiary of the
Borrower) of, Permitted Refinancing Indebtedness;

(iv) the payment of any dividend by a Material Subsidiary of the Borrower to the
holders of its common Equity Interests on a pro rata basis;

(v) the repurchase, redemption or other acquisition or retirement for value of
any Equity Interests of the Borrower or any Material Subsidiary of the Borrower
held by any member of the Borrower’s (or any of its Material Subsidiaries’)
management pursuant to any management equity subscription agreement or stock
option agreement in effect as of the Revolving Credit Facility Closing Date;
provided that the aggregate price paid for all such repurchased, vested,
redeemed, acquired or retired Equity Interests shall not exceed $1,000,000 in
any twelve-month period;

(vi) the purchase of any subordinated Indebtedness at a purchase price not
greater than 100% of the principal amount or accreted value thereof, as the case
may be, together with accrued interest, if any, following (and in an amount not
to exceed the Net Proceeds of (less any amounts applied as required by Sections
2.10(c) and (e))) an Asset Sale permitted under Section 6.03;

(vii) making payments to dissenting shareholders pursuant to applicable law in
connection with a consolidation or merger of the Borrower made in compliance
with the provisions of this Agreement;

(viii) Restricted Investments in an amount equal to 100% of Total Incremental
Equity since the Revolving Credit Facility Closing Date determined as of the
date any such Restricted Investment is made, less any amount of such Total
Incremental Equity previously applied to make a Restricted Investment pursuant
to this subclause (viii);

(ix) the payment of dividends to Holdings the proceeds of which are used to
satisfy ordinary course administrative expenses of Holdings, but in no event to
exceed $3,000,000 in any given fiscal year of the Borrower;

(x) for so long as Holdings files consolidated income tax returns which include
the Borrower, the payment of any dividend required pursuant to the Tax Sharing
Agreement between the Borrower and Holdings, and any renewals, extensions,
implementations or modifications thereof that are not materially adverse to the
Lenders; provided that any such payment made by the Borrower to Holdings from
time to time shall not exceed the net amount of the relevant (estimated or
final, as the case may be) tax liability that Holdings actually owes to the
appropriate taxing authority at such time in respect of the tax obligations of
the Borrower and its Subsidiaries;

 

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(xi) any payments required by Section 9.7(b) of the Note Purchase Agreement;

(xii) the repurchase, redemption or other acquisition or retirement of Equity
Interests (other than Disqualified Stock) deemed to occur upon the exercise,
vesting, exchange or conversion of stock options, warrants or other similar
rights to the extent such Equity Interests represent a portion of the exercise
or exchange price of those stock options, and the repurchase, redemption or
other acquisition or retirement of Equity Interests (other than Disqualified
Stock) is made in lieu of withholding taxes resulting from the exercise,
vesting, exchange or conversion of stock options, warrants or other similar
rights and such repurchase, redemption, acquisition or retirement of such Equity
Interests does not involve any payment by the Borrower or a Material Subsidiary
of any cash or Cash Equivalents in exchange therefor;

(xiii) an XM-4 Sale and Leaseback Transaction that involves transactions between
the Borrower and Holdings or one or more of the Subsidiaries of either;

(xiv) the purchase of any subordinated Indebtedness at a purchase price not
greater than 101% of the principal amount or accreted value thereof, as the case
may be, together with accrued interest, if any, following a “change of control”
under and as defined in the documents pursuant to which such subordinated
Indebtedness is issued, as applicable, in accordance with the provisions
thereof; provided, however, that prior to such purchase the Borrower shall have
made any payments (including the deposit of any cash collateral) required by
Section 2.10(d); and

(xv) the payment of one or more dividends or making of one or more distributions
on account of the Borrower’s Equity Interest by the Borrower to Holdings the
proceeds of which are solely used in connection with the Merger or any Merger
Related Event by Holdings for the purposes set forth on, and in an aggregate
amount which does not exceed the amount set forth on, Schedule 6.06.

(c) The amount of all Restricted Payments (other than cash) shall be the fair
market value on the date of the Restricted Payment of the asset(s) or securities
proposed to be transferred or issued to or by the Borrower or such Material
Subsidiary, as the case may be, pursuant to the Restricted Payment. The fair
market value of any assets or securities that are required to be valued by this
covenant shall be determined by the Board of Directors of the Borrower, whose
good faith resolution with respect thereto shall be conclusive and shall be
delivered to the Administrative Agent, and the fair market value of any assets
or securities that are required to be valued by this Section 6.06 that exceeds
$5,000,000 shall be determined by a majority of the members of the Board of
Directors of the Borrower who are “independent” within the meaning of the rules
and regulations promulgated by the NASDAQ National Market, whose good faith
resolution with respect thereto shall be conclusive and shall be delivered to
the Administrative Agent. Not later than the date of making any Restricted
Payment, the Borrower shall deliver to the Administrative Agent an officers’
certificate stating that such Restricted Payment is permitted and setting forth
the basis upon which the calculations required by this “Restricted Payments”
covenant were computed, together with a copy of resolutions of the Board of
Directors required hereby.

 

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SECTION 6.07 Transactions with Affiliates. (a) The Borrower shall not, and shall
not permit any of its Material Subsidiaries to, make any payment to, or sell,
lease, transfer or otherwise dispose of any of its properties or assets to, or
purchase any property or assets from, or enter into or make or amend any
transaction, contract, agreement, understanding, loan, advance or guarantee
with, or for the benefit of, any Affiliate (each, an “Affiliate Transaction”),
unless:

(i) such Affiliate Transaction is on terms that are no less favorable to the
Borrower or the relevant Material Subsidiary than those that would have been
obtained in a comparable transaction by the Borrower or such Material Subsidiary
with an unrelated Person; and

(ii) the Borrower delivers to the Administrative Agent:

(A) with respect to any Affiliate Transaction or series of related Affiliate
Transactions involving aggregate consideration in excess of $5,000,000, board
resolutions set forth in an officers’ certificate certifying that such Affiliate
Transaction complies with this Section 6.07 and, if an opinion meeting the
requirements set forth in subclause (B) below has not been obtained, that such
Affiliate Transaction has been approved by a majority of the members of the
board of directors who have no direct financial interest in such Affiliate
Transaction (other than as a stockholder of Holdings); and

(B) with respect to (x) any Affiliate Transaction or series of related Affiliate
Transactions involving aggregate consideration in excess of $20,000,000, or
(y) an Affiliate Transaction or series of related Affiliate Transactions
involving aggregate consideration in excess of $5,000,000 where none of the
members of the board of directors qualify as having no direct financial interest
in such Affiliate Transaction (other than as a stockholder of Holdings), an
opinion as to the fairness to the Borrower or such Material Subsidiary of such
Affiliate Transaction from a financial point of view issued by an accounting,
appraisal or investment banking firm of national standing.

(b) The following items shall not be deemed to be Affiliate Transactions and,
therefore, shall not be subject to the provisions of clause (a):

(i) any transaction by the Borrower or any Material Subsidiary with an Affiliate
related to the purchase, sale or distribution of XM radios, subscriptions to XM
Radio Service or other products or services in the ordinary course of business,
including any such transaction with an automotive manufacturer, which has been
approved by a majority of the members of the board of directors who are
disinterested with respect to such transaction;

(ii) any employment agreement or arrangement or employee benefit plan entered
into by the Borrower or any of its Material Subsidiaries in the ordinary course
of business of the Borrower or such Material Subsidiary;

 

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(iii) transactions between or among the Borrower and/or its Material
Subsidiaries;

(iv) payment of reasonable directors fees and provisions of customary
indemnification to directors, officers and employees of the Borrower and its
Material Subsidiaries;

(v) sales of Equity Interests (other than Disqualified Stock) to Affiliates of
the Borrower;

(vi) Restricted Payments that are permitted under Section 6.06(b) and under
subclauses (h) and (i) of the definition of “Permitted Investments”;

(vii) transactions pursuant to the Tax Sharing Agreement and any renewals,
extensions, implementations or modifications thereof that are not materially
adverse to the Lenders;

(viii) contractual arrangements existing on the Revolving Credit Facility
Closing Date and any renewals, extensions, implementations or modifications
thereof that are not materially adverse to the Lenders;

(ix) increases, decreases or other modifications to the Indebtedness referred to
in the definition of January Financing Transactions which have been approved by
a majority of the members of the Board of Directors of the Borrower who are
disinterested with respect to such transactions and which are otherwise
permitted under this Agreement;

(x) an XM-4 Sale and Leaseback Transaction that involves transactions between
the Borrower and Holdings or one or more of the Subsidiaries of either; and

(xi) the Parent Company Merger.

SECTION 6.08 Negative Pledge. The Borrower shall not, and shall not permit any
Material Subsidiaries to, directly or indirectly enter into, incur or permit to
exist any agreement or other arrangement that prohibits or restricts the ability
of the Borrower or any Material Subsidiary to create, incur or permit to exist
any Lien upon any of the Collateral to secure the Borrower Obligations or the
Guarantor Obligations; provided that (i) the foregoing shall not apply to
(i) restrictions imposed by law or by this Agreement, (ii) restrictions existing
on the date hereof identified on Schedule 6.08 (but shall apply to any amendment
or modification expanding the scope of, any such restriction or condition),
(iii) restrictions imposed by any agreement relating to purchase money
Indebtedness or Capital Leases permitted by this Agreement if such restrictions
apply only to the property or assets securing such Indebtedness and
(iv) customary provisions in leases and other contracts restricting the
assignment thereof.

SECTION 6.09 Liquidity Test. The Borrower shall not permit its unrestricted cash
and Cash Equivalents at any time to be less than (a) on or before August 20,
2008, $50,000,000 in the aggregate, and (b) at all other times, $75,000,000 in
the aggregate.

 

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SECTION 6.10 Line of Business. The Borrower shall not, and shall not permit any
of its Material Subsidiaries to, enter into any business, either directly or
through any Subsidiary, except for the Permitted Business.

SECTION 6.11 Amendments or Waivers of the Security Documents, Senior Notes
Documents, Revolving Credit Facility Agreement and the Distribution and Credit
Agreement. (a) The Borrower shall not, nor shall it permit any of its
Subsidiaries to (i) amend, modify, waive or otherwise change the terms of the
Security Documents, except with the prior written consent of the Required
Lenders, or (ii) do anything in connection with the Existing Collateral
Documents requiring the consent of the Collateral Agent unless the Borrower or
such Subsidiary has also obtained the prior consent of the Required Lenders with
respect thereto.

(b) The Borrower shall not, nor shall it permit any of its Subsidiaries to,
amend, modify, waive or otherwise change, or consent or agree to any amendment,
modification, waiver or other change to, any of the terms of the Senior Notes
Documents that would be materially adverse to the interests of the Borrower or
the Lenders; provided, however, that (i) any payments permitted by clauses
(x) and (y) of Section 6.14 and any changes to the terms of the applicable
Senior Notes Documents that are necessary to implement (or are directly related
to the implementation of) any New Senior Notes Waiver and/or any New Senior
Notes Extension and (ii) any other changes to the terms of the applicable Senior
Notes Documents made in connection with any New Senior Notes Waiver and/or any
New Senior Notes Extension, if such changes would be permitted to be included in
any Permitted Refinancing Indebtedness that would be permitted under this
Agreement to be used to refinance the applicable Senior Notes, in each case
shall be deemed not to be materially adverse to the interests of the Borrower or
the Lenders.

(c) To the extent that the holders of the Obligations under the Distribution and
Credit Agreement shall have a Lien on any of the Collateral (including the GM
Lien) under the Existing Collateral Documents or otherwise, the Borrower shall
not, nor shall it permit any of its Subsidiaries to, amend or otherwise change
the terms of Section 13 of the Distribution and Credit Agreement (or any other
term of the Distribution and Credit Agreement relating to the borrowing,
repayment, prepayment or termination of, or the security for the repayment of or
guaranty of, any Advance (as defined in the Distribution and Credit Agreement)
thereunder) if the effect of such amendment or change, together with all other
amendments or changes made, is to increase materially the obligations of the
Borrower and/or Holdings thereunder or to confer any additional rights on the
holders of the Obligations under the Distribution and Credit Agreement in a
manner which would be materially adverse to any Loan Party or the Lenders,
except as otherwise expressly permitted under this Agreement or with the prior
consent of the Required Lenders.

(d) (x) the Borrower shall not, nor shall it permit any of its Subsidiaries to,
grant to the Revolving Credit Facility Secured Parties a Lien on any of its
assets that are not included in the definition of “Collateral” unless such Lien
is also granted to the New Secured Parties on the same terms and (y) the
Borrower shall not, nor shall it permit any of its Subsidiaries to, (i) permit
(other than pursuant to any mandatory prepayment or acceleration of the
Revolving Credit Facility Loans pursuant to and in accordance with the Revolving
Credit

 

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Facility Agreement as in effect on the date hereof) the final maturity date of
the Revolving Credit Facility Loans to be prior to the final maturity date of
the Loans, or the Weighted Average Life to Maturity of the Revolving Credit
Facility Loans to be less than that of the Loans and (ii) amend or otherwise
modify the terms of the Revolving Credit Facility Agreement or any other
Revolving Credit Facility Document (including, without limitation, the
definition of “Release Date” or any such other comparable provision appearing
therein) if the effect of such amendment or modification is to increase
materially the obligations of the Borrower and/or its Subsidiaries thereunder or
to confer any additional rights on the holders of the Revolving Credit Facility
Obligations in a manner which would be materially adverse to any Loan Party or
the Lenders, except, in the case of clauses (x), (y)(i) and (y)(ii), as
otherwise expressly permitted under this Agreement or with the prior written
consent of the Required Lenders; provided that (i) if such amendment or
modification is proposed to be made to any provision of the Revolving Credit
Facility Agreement that is also contained (in identical or substantially
identical form) in this Agreement and (ii) such amendment or modification to
such provision in this Agreement would only, if made hereunder, require the
consent of the Borrower and the Required Lenders, then such amendment or
modification shall be permitted to be made to the Revolving Credit Facility (and
if so made an identical amendment shall simultaneously be made to this
Agreement) if the Lenders and Revolving Credit Facility Lenders (voting as a
single class) holding in the aggregate more than 50% of the sum of (A) the
Commitments (or, if the Commitments have been terminated, the Loans) and (B) the
Revolving Credit Facility Commitments (or, if the Revolving Credit Facility
Commitments have been terminated, the Revolving Credit Facility Loans) (the
“Aggregate Required Lenders”) consent to such amendment or modification.

SECTION 6.12 Reserved.

SECTION 6.13 XM-4 Satellite Collateral. The Borrower shall not, and shall not
permit any of its Subsidiaries to, enter into any license and/or access
agreement with respect to the Indivisible Ancillary XM-4 Satellite Collateral in
connection with a sale and leaseback transaction except as otherwise permitted
by Section 9.06.

SECTION 6.14 Limitation on Outstandings and Use of Cash. The Borrower shall not
permit any of its cash or Cash Equivalents to be used, whether directly or
indirectly, for the repurchase, redemption or refinancing of any or all of the
Existing 10% Notes, the New Senior Notes or the Owner Trustee Notes, other than
such cash and Cash Equivalents that are the proceeds of Permitted Refinancing
Indebtedness in respect of such Existing 10% Notes, New Senior Notes or Owner
Trustee Notes, as applicable; provided, however, that, notwithstanding the
foregoing, (x) any Cash or Cash Equivalents of the Borrower may be used in
connection with the repurchase, redemption or refinancing of any or all of the
Existing 10% Notes, including in connection with an Existing 10% Notes Change of
Control Offer, in an aggregate amount (the “Take-Out Amount”) not to exceed 101%
of the principal amount of such Existing 10% Notes plus accrued and unpaid
interest, if any; provided that, the determination of such Take-Out Amount for
purposes hereof shall exclude any amount paid in Equity Interests of Holdings
(prior to the Merger) or SIRIUS (following the Merger) or proceeds of such
Equity Interests and (y) the Borrower may use its cash and Cash Equivalents
(i) in an aggregate amount not to exceed the amount set forth on part (a) of
Schedule 6.14 to pay any fees required to be paid by the Borrower or Holdings in
connection with the Existing 10% Notes Waiver, the New Senior Notes Waiver
and/or the XM-4 Sale and Leaseback Waiver and (ii) in an aggregate amount not to
exceed the amount set forth on part (b) of Schedule 6.14 to pay any fees
required to be paid by the Borrower

 

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or Holdings in connection the Existing 10% Notes Extension, the New Senior Notes
Extension and/or the XM-4 Sale and Leaseback Extension; provided that the
aggregate amount of cash and Cash Equivalents used pursuant to this clause
(y) shall not exceed the amount set forth on part (a) of Schedule 6.14.

ARTICLE VII.

Events of Default

If any of the following events (“Events of Default”) shall occur:

(a) the Borrower shall fail to pay any principal of any Loan, whether at the
Maturity Date thereof or at a date fixed for prepayment thereof or otherwise;

(b) the Borrower shall fail to pay any interest on any Loan or any fee or any
other amount (other than an amount referred to in clause (a) of this Article)
payable under this Agreement, or any other Loan Document or the Fee Letter when
and as the same shall become due and payable, and such failure shall continue
unremedied for a period of three Business Days;

(c) any representation or warranty made or deemed made by or on behalf of any
Loan Party in this Agreement or any other Loan Document or any amendment or
modification hereof or thereof or waiver hereunder or thereunder, or in any
report, certificate, financial statement or other document furnished pursuant to
or in connection with this Agreement or any other Loan Document (excluding, in
each case, any projections delivered by or on behalf of any Loan Party) or any
amendment or modification hereof or thereof or waiver hereunder or thereunder,
shall prove to have been materially incorrect when made or deemed made;

(d) the Borrower or Holdings, as applicable, shall fail to observe or perform
any covenant, condition or agreement contained in Section 5.02, 5.03 (with
respect to the Borrower’s existence) or 5.08 or in Article VI or in
Section 9.05;

(e) the Borrower shall fail to observe or perform any covenant, condition or
agreement contained in this Agreement or any other Loan Document (other than
those specified in clause (a), (b) or (d) of this Article), and such failure
shall continue unremedied for a period of 30 days after notice thereof from the
Administrative Agent to the Borrower (which notice will be given at the request
of any Lender);

(f) (i) Holdings, the Borrower or any of its Subsidiaries shall (x) fail to make
any payment of principal or interest, in each case regardless of amount (subject
to any applicable grace period) in respect of any Material Indebtedness when and
as the same shall become due and payable or (y) shall fail to observe or perform
any covenant, condition or agreement contained in any Material Indebtedness,
which failure enables or permits (with or without the giving of notice, the
lapse of time or both) the holder or holders of any Material Indebtedness or any
trustee or agent on its or their behalf to cause any Material Indebtedness to
become due, or to require the prepayment, repurchase, redemption or defeasance
thereof, prior to its scheduled maturity or (ii) any event or

 

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condition occurs that results in any Material Indebtedness becoming due prior to
its scheduled maturity or that enables or permits (with or without the giving of
notice, the lapse of time or both) the holder or holders of any Material
Indebtedness or any trustee or agent on its or their behalf to cause any
Material Indebtedness to become due, or to require the prepayment, repurchase,
redemption or defeasance thereof, prior to its scheduled maturity; provided,
that this clause (f)(ii) shall not apply with respect to the occurrence of any
Potential Default from the Effective Date until the Expiration Date; provided,
further that this clause (f) shall not apply to (1) any Material Indebtedness
under a Deferred Purchase Price Agreement if the failure to make a payment
thereunder occurred in connection with a good faith contest by the Borrower with
respect to the performance by the satellite manufacturer of its obligations
thereunder, (2) the failure of the Borrower to observe or perform any covenant,
condition or agreement (other than with respect to the making of payments) in
respect of the mortgage existing on the Closing Date on the building where the
Borrower is headquartered, or (3) Indebtedness that becomes due as a result of
the voluntary sale or transfer of property or assets, the issuance of Equity
Interests or the incurrence of Permitted Debt; provided that, for the avoidance
of doubt, this clause (3) shall not apply to the sale, assignment, transfer,
conveyance or other disposition of all or substantially all of the property or
assets or Equity Interests of Holdings or the Borrower or any other parent
entity thereof.

(g) (i) Holdings, the Borrower or any of its Subsidiaries shall (x) fail to make
any payment of principal or interest, in each case regardless of amount (subject
to any applicable grace period) in respect of the Revolving Credit Facility
Obligations or any Permitted Refinancing Indebtedness in respect thereof when
and as the same shall become due and payable or (y) shall fail to observe or
perform any covenant, condition or agreement contained in the Revolving Credit
Facility Documents or any Permitted Refinancing Indebtedness in respect thereof,
which failure enables or permits (with or without the giving of notice, the
lapse of time or both) the holder or holders of the Revolving Credit Facility
Obligations or any Permitted Refinancing Indebtedness in respect thereof or any
trustee or agent on its or their behalf to cause the Revolving Credit Facility
Obligations or any Permitted Refinancing Indebtedness in respect thereof to
become due, or to require the prepayment, repurchase, redemption or defeasance
thereof, prior to its scheduled maturity or (ii) any event or condition occurs
that results in the Revolving Credit Facility Obligations or any Permitted
Refinancing Indebtedness in respect thereof becoming due prior to its scheduled
maturity or that enables or permits (with or without the giving of notice, the
lapse of time or both) the holder or holders of the Revolving Credit Facility
Obligations or any Permitted Refinancing Indebtedness in respect thereof or any
trustee or agent on its or their behalf to cause the Revolving Credit Facility
Obligations or such Permitted Refinancing Indebtedness to become due, or to
require the prepayment, repurchase, redemption or defeasance thereof, prior to
its scheduled maturity;

(h) an involuntary proceeding shall be commenced or an involuntary petition
shall be filed seeking (i) liquidation, reorganization or other relief in
respect of Holdings, the Borrower or any Material Subsidiary or any of its
debts, or of a substantial part of any of its assets, under any Federal, state
or foreign bankruptcy, insolvency, receivership or similar law now or hereafter
in effect or (ii) the appointment of a receiver, trustee,

 

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custodian, sequestrator, conservator or similar official for Holdings, the
Borrower or any Material Subsidiary or for a substantial part of its assets,
and, in any such case, such proceeding or petition shall continue undismissed
for 60 days or an order or decree approving or ordering any of the foregoing
shall be entered;

(i) Holdings, the Borrower or any Subsidiary shall (i) voluntarily commence any
proceeding or file any petition seeking liquidation, reorganization or other
relief under any Federal, state or foreign bankruptcy, insolvency, receivership
or similar law now or hereafter in effect, (ii) consent to the institution of,
or fail to contest in a timely and appropriate manner, any proceeding or
petition described in clause (h) of this Article, (iii) apply for or consent to
the appointment of a receiver, trustee, custodian, sequestrator, conservator or
similar official for Holdings, the Borrower or any Subsidiary or for a
substantial part of its assets, (iv) file an answer admitting the material
allegations of a petition filed against it in any such proceeding, (v) make a
general assignment for the benefit of creditors or (vi) take any action for the
purpose of effecting any of the foregoing;

(j) Holdings, the Borrower or any Subsidiary shall become unable, admit in
writing its inability or fail generally to pay its debts as they become due;

(k) one or more judgments for the payment of money (including, without
limitation, arising from matters set forth in clauses (f) or (g) of this Article
(including the express exclusions therefrom)) in an aggregate amount in excess
of $25,000,000 (to the extent not adequately covered by insurance as to which a
solvent and unaffiliated insurance company has not denied coverage) shall be
rendered against Holdings, the Borrower, any Subsidiary or any combination
thereof and the same shall remain undischarged for a period of 30 consecutive
days during which execution shall not be effectively stayed, or any action shall
be legally taken by a judgment creditor to attach or levy upon any assets of the
Borrower or any Subsidiary to enforce any such judgment; or

(l) (i) an ERISA Event shall have occurred that when taken together with all
other ERISA Events that have occurred, which individually or in the aggregate
results in or could reasonably be expected to result in liability of Borrower or
any ERISA Affiliate in excess of $25,000,000; (ii) there exists any fact or
circumstance that reasonably could be expected to result in the imposition of a
Lien or security interest under Section 412(n) of the Internal Revenue Code or
under ERISA; or (iii) any “accumulated funding deficiency” (as defined in
Section 302 of ERISA), whether or not waived, shall exist with respect to any
Plan or any Lien in favor of the PBGC or a Plan shall arise on the assets of the
Borrower or any ERISA Affiliate;

then, and in every such event (other than an event with respect to the Borrower
described in clause (h) or (i) of this Article), and at any time thereafter
during the continuance of such event, the Administrative Agent may, and at the
request of the Required Lenders shall, by notice to the Borrower, declare the
Loans then outstanding to be due and payable in whole (or in part, in which case
any principal not so declared to be due and payable may thereafter be declared
to be due and payable), and thereupon the principal of the Loans so declared to
be due and payable, together with accrued interest thereon and all fees and
other obligations of the Borrower accrued

 

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hereunder, shall become due and payable immediately, without presentment,
demand, protest or other notice of any kind, all of which are hereby waived by
the Borrower; and in case of any event with respect to the Borrower described in
clause (h) or (i) of this Article, the principal of the Loans then outstanding,
together with accrued interest thereon and all fees and other obligations of the
Borrower accrued hereunder, shall automatically become due and payable without
presentment, demand, protest or other notice of any kind, all of which are
hereby waived by the Borrower.

ARTICLE VIII.

The Administrative Agent

SECTION 8.01 Appointment. Each of the Lenders hereby irrevocably appoints the
Administrative Agent as its agent and authorizes the Administrative Agent to
take such actions on its behalf and to exercise such powers as are delegated to
the Administrative Agent by the terms hereof, together with such actions and
powers as are reasonably incidental thereto. Each Lender hereby irrevocably
appoints JPMorgan Chase Bank, N.A. as its New Collateral Agent pursuant to and
in accordance with the terms of the Collateral Agency Agreement and authorizes
the New Collateral Agent to enter into and execute the Collateral Agency
Agreement and to take such actions on its behalf and to exercise such powers as
are delegated to the New Collateral Agent by the terms hereof and the Collateral
Agency Agreement (including, without limitation, the execution and delivery of
the Collateral Agreement and each other applicable Security Document), together
with such actions and powers as are reasonably incidental thereto. In addition,
upon the occurrence of the Release Date, each Lender hereby irrevocably
authorizes the Administrative Agent and the New Collateral Agent to enter into
and execute the Collateral Agreement, which shall be effective as of the Release
Date. Each of the Lenders hereby irrevocably authorizes the Administrative Agent
and the New Collateral Agent to enter into and execute the first amendment to
the Second Lien Intercreditor Agreement, which first amendment shall be
effective as of the Closing Date.

SECTION 8.02 Administrative Agent in its Individual Capacity. The bank serving
as the Administrative Agent hereunder shall have the same rights and powers in
its capacity as a Lender as any other Lender and may exercise the same as though
it were not the Administrative Agent, and such bank and its Affiliates may
accept deposits from, lend money to and generally engage in any kind of business
with the Borrower or any Subsidiary or other Affiliate thereof as if it were not
the Administrative Agent hereunder.

SECTION 8.03 Exculpatory Provisions. The Administrative Agent shall not have any
duties or obligations except those expressly set forth herein. Without limiting
the generality of the foregoing, (a) the Administrative Agent shall not be
subject to any fiduciary or other implied duties, regardless of whether a
Default has occurred and is continuing, (b) the Administrative Agent shall not
have any duty to take any discretionary action or exercise any discretionary
powers, except discretionary rights and powers expressly contemplated hereby
that the Administrative Agent is required to exercise in writing as directed by
the Required Lenders (or such other number or percentage of the Lenders as shall
be necessary under the circumstances as provided in Section 9.02), and
(c) except as expressly set forth herein, the Administrative Agent shall not
have any duty to disclose, and shall not be liable for the failure to

 

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disclose, any information relating to the Borrower or any of its Subsidiaries
that is communicated to or obtained by the bank serving as Administrative Agent
or any of its Affiliates in any capacity. The Administrative Agent shall not be
liable for any action taken or not taken by it with the consent or at the
request of the Required Lenders (or such other number or percentage of the
Lenders as shall be necessary under the circumstances as provided in
Section 9.02) or in the absence of its own gross negligence or willful
misconduct.

SECTION 8.04 Notice of Default. The Administrative Agent shall be deemed not to
have knowledge of any Default unless and until written notice thereof is given
to the Administrative Agent by the Borrower or a Lender, and the Administrative
Agent shall not be responsible for or have any duty to ascertain or inquire into
(i) any statement, warranty or representation made in or in connection with this
Agreement, (ii) the contents of any certificate, report or other document
delivered hereunder or in connection herewith, (iii) the performance or
observance of any of the covenants, agreements or other terms or conditions set
forth herein, (iv) the validity, enforceability, effectiveness or genuineness of
this Agreement or any other agreement, instrument or document, or (v) the
satisfaction of any condition set forth in Article IV or elsewhere herein, other
than to confirm receipt of items expressly required to be delivered to the
Administrative Agent.

SECTION 8.05 Reliance by the Administrative Agent. The Administrative Agent
shall be entitled to rely upon, and shall not incur any liability for relying
upon, any notice, request, certificate, consent, statement, instrument, document
or other writing believed by it to be genuine and to have been signed or sent by
the proper Person. The Administrative Agent also may rely upon any statement
made to it orally or by telephone and believed by it to be made by the proper
Person, and shall not incur any liability for relying thereon. The
Administrative Agent may consult with legal counsel (who may be counsel for the
Borrower), independent accountants and other experts selected by it, and shall
not be liable for any action taken or not taken by it in accordance with the
advice of any such counsel, accountants or experts.

SECTION 8.06 Delegation of Duties. The Administrative Agent may perform any and
all of its duties and exercise its rights and powers by or through any one or
more sub-agents appointed by the Administrative Agent. The Administrative Agent
and any such sub-agent may perform any and all of its duties and exercise its
rights and powers through their respective Related Parties. The exculpatory
provisions of this Article VIII shall apply to any such sub-agent and to the
Related Parties of the Administrative Agent and any such sub-agent, and shall
apply to their respective activities in connection with the syndication of the
credit facilities provided for herein as well as activities as Administrative
Agent.

SECTION 8.07 Successor Administrative Agent. Subject to the appointment and
acceptance of a successor Administrative Agent as provided in this Section, the
Administrative Agent may resign at any time by notifying the Lenders and the
Borrower. Upon any such resignation, the Required Lenders shall have the right,
with the consent of Borrower so long as no Event of Default shall have occurred
and be continuing (such consent not to be unreasonably withheld or delayed) to
appoint a successor. If no successor shall have been so appointed by the
Required Lenders and shall have accepted such appointment within 30 days after
the retiring Administrative Agent gives notice of its resignation, then the
retiring Administrative Agent may, on behalf of the Lenders, appoint a successor
Administrative Agent which shall be a bank with

 

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an office in New York, New York, or an Affiliate of any such bank. Upon the
acceptance of its appointment as Administrative Agent hereunder by a successor,
such successor shall succeed to and become vested with all the rights, powers,
privileges and duties of the retiring Administrative Agent, and the retiring
Administrative Agent shall be discharged from its duties and obligations
hereunder. The fees payable by the Borrower to a successor Administrative Agent
shall be the same as those payable to its predecessor unless otherwise agreed
between the Borrower and such successor. After the Administrative Agent’s
resignation hereunder, the provisions of this Article and Section 9.03 shall
continue in effect for the benefit of such retiring Administrative Agent, its
sub-agents and their respective Related Parties in respect of any actions taken
or omitted to be taken by any of them while it was acting as Administrative
Agent.

SECTION 8.08 Non-Reliance on Administrative Agent and Other Lenders. Each Lender
acknowledges that it has, independently and without reliance upon the
Administrative Agent or any other Lender and based on such documents and
information as it has deemed appropriate, made its own credit analysis and
decision to enter into this Agreement. Each Lender also acknowledges that it
will, independently and without reliance upon the Administrative Agent or any
other Lender and based on such documents and information as it shall from time
to time deem appropriate, continue to make its own decisions in taking or not
taking action under or based upon this Agreement, any related agreement or any
document furnished hereunder or thereunder.

SECTION 8.09 Indemnification. Each Lender agrees to indemnify the Administrative
Agent in its capacity as such (to the extent not reimbursed by the Borrower and
without limiting the obligation of the Borrower to do so), in the amount of its
pro rata share (based on its Loans hereunder), from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind whatsoever that may at any time
(whether before or after the payment of the Loans) be imposed on, incurred by or
asserted against the Administrative Agent in any way relating to or arising out
of the Loans, this Agreement, any of the other Loan Documents or any documents
contemplated by or referred to herein or therein or the transactions
contemplated hereby or thereby or any action taken or omitted by the
Administrative Agent under or in connection with any of the foregoing; provided
that no Lender shall be liable for the payment of any portion of such
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements that are found by a final and nonappealable
decision of a court of competent jurisdiction to have resulted from the
Administrative Agent’s gross negligence or willful misconduct. The agreements in
this Section shall survive the payment of the Loans and all other amounts
payable hereunder.

SECTION 8.10 Arranger. The Arranger shall not have any duties or
responsibilities hereunder in its capacity as such.

ARTICLE IX.

Miscellaneous

SECTION 9.01 Notices. (a) Except in the case of notices and other communications
expressly permitted to be given by telephone (and subject to paragraph (b)

 

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below), all notices and other communications provided for herein shall be in
writing and shall be delivered by hand or overnight courier service, mailed by
certified or registered mail or sent by telecopy, as follows:

(i) if to the Borrower,

XM Satellite Radio Inc.

1500 Eckington Place, N.E.

Washington D.C. 20002

Attention of Chief Financial Officer

(with a copy to the General Counsel

and the Treasurer)

(Telecopy No. (202) 380-4534);

(ii) if to the Administrative Agent, to

UBS AG

677 Washington Blvd,

Stamford, CT 06901

Attention of: Tara Cimbrello

Telecopy No. (203) 719-6130; and

(iii) if to any other Lender, to it at its address (or telecopy number) set
forth in its Administrative Questionnaire.

(b) Notices and other communications to the Lenders hereunder may be delivered
or furnished by electronic communications pursuant to procedures approved by the
Administrative Agent; provided that the foregoing shall not apply to notices
pursuant to Article II unless otherwise agreed by the Administrative Agent and
the applicable Lender. The Administrative Agent or the Borrower may, in its
discretion, agree to accept notices and other communications to it hereunder by
electronic communications pursuant to procedures approved by it; provided that
approval of such procedures may be limited to particular notices or
communications.

(c) Any party hereto may change its address or telecopy number for notices and
other communications hereunder by notice to the other parties hereto. All
notices and other communications given to any party hereto in accordance with
the provisions of this Agreement shall be deemed to have been given on the date
of receipt.

SECTION 9.02 Waivers; Amendments. (a) No failure or delay by the Administrative
Agent or any Lender in exercising any right or power hereunder or under any
other Loan Document shall operate as a waiver thereof, nor shall any single or
partial exercise of any such right or power, or any abandonment or
discontinuance of steps to enforce such a right or power, preclude any other or
further exercise thereof or the exercise of any other right or power. The rights
and remedies of the Administrative Agent and the Lenders hereunder are
cumulative and are not exclusive of any rights or remedies that they would
otherwise have. No

 

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waiver of any provision of this Agreement or any other Loan Document or consent
to any departure by the Borrower therefrom shall in any event be effective
unless the same shall be permitted by paragraph (b) of this Section, and then
such waiver or consent shall be effective only in the specific instance and for
the purpose for which given. Without limiting the generality of the foregoing,
the making of a Loan shall not be construed as a waiver of any Default,
regardless of whether the Administrative Agent or any Lender may have had notice
or knowledge of such Default at the time.

(b) Neither this Agreement nor any other Loan Document nor any provision hereof
or thereof may be waived, amended or modified except (x) pursuant to an
agreement or agreements in writing entered into by the Borrower and the Required
Lenders, (y) by the Borrower and the Administrative Agent with the consent of
the Required Lenders or (z) as required by Section 6.11(d); provided that no
such agreement or required amendment or modification shall (i) increase the
Commitment of any Lender without the written consent of such Lender, (ii) reduce
the principal amount of any Loan or reduce the rate of interest thereon, or
reduce any fees payable hereunder, without the written consent of each Lender
affected thereby, (iii) postpone the scheduled date of payment of the principal
amount of any Loan, or any interest thereon, or any fees payable hereunder, or
reduce the amount of, waive or excuse any such payment, or postpone the
scheduled date of expiration of any Commitment, without the written consent of
each Lender affected thereby, (iv) change Section 2.17(b) or (c) in a manner
that would alter the pro rata sharing of payments required thereby, without the
written consent of each Lender, (v) change any of the provisions of
Section 6.11(d) without the written consent of each Lender, (vi) change any of
the provisions of this Section or the definition of “Required Lenders” or any
other provision hereof specifying the number or percentage of Lenders required
to waive, amend or modify any rights hereunder or make any determination or
grant any consent hereunder, without the written consent of each Lender,
(vii) (x) permit the incurrence by Holdings, the Borrower or any Material
Subsidiary of secured Indebtedness in an aggregate amount which exceeds the
aggregate amount of secured Indebtedness permitted to be incurred under
Section 6.01(b) as in effect on the Closing Date or (y) change (or permit the
change of) the ranking or priority of any secured Indebtedness, in either case,
without the written consent of the Lenders then holding in the aggregate more
than 67% of (1) the Commitments or (2) if the Commitments have been terminated,
the outstanding Loans, or (viii) release all or substantially all of the
Collateral or release any of Holdings or any Subsidiary Loan Party from its
guarantee under the Guarantee Agreement, unless, in the case of a Subsidiary
Loan Party, all or substantially all of the Equity Interests of such Subsidiary
Loan Party are sold or otherwise disposed of in a transaction permitted by this
Agreement or such Subsidiary Loan Party shall become an Immaterial Subsidiary in
accordance with the provisions of this Agreement, in each case without the prior
written consent of each Lender.

SECTION 9.03 Expenses; Indemnity; Damage Waiver. (a) The Borrower shall pay
(i) all reasonable out-of-pocket expenses incurred by the Administrative Agent
and its Affiliates, including the reasonable fees, charges and disbursements of
counsel for the Administrative Agent, in connection with Intralinks (and related
expenses) and the preparation and administration of this Agreement or any
amendments, modifications or waivers of the provisions hereof (whether or not
the transactions contemplated hereby or thereby shall be consummated), (ii) all
out-of-pocket expenses incurred by the Administrative Agent or, after an Event
of Default shall have occurred and be continuing hereunder, any Lender,
including the

 

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fees, charges and disbursements of any counsel for the Administrative Agent or
any Lender, in connection with the enforcement or protection of its rights in
connection with this Agreement, including its rights under this Section, or in
connection with the Loans made hereunder, including all such out-of-pocket
expenses incurred during any workout, restructuring or negotiations in respect
of such Loans.

(b) The Borrower shall indemnify the Administrative Agent, the Arranger and each
Lender, and each Related Party of any of the foregoing Persons (each such
Person, an “Indemnitee”) against, and hold each Indemnitee harmless from, any
and all losses, claims, damages, liabilities and related expenses, including the
fees, charges and disbursements of any counsel for any Indemnitee, incurred by
or asserted against any Indemnitee arising out of, in connection with, or as a
result of claims (other than a claim by the Borrower or any of its Affiliates)
relating to (i) the execution or delivery of this Agreement or any agreement or
instrument contemplated hereby, the performance by the parties hereto of their
respective obligations hereunder or the consummation of the Transactions or any
other transactions contemplated hereby, (ii) any Loan or the use of the proceeds
therefrom, (iii) any actual or alleged presence or release of Hazardous
Materials on, from or to any property currently or formerly owned or operated by
the Borrower or any of its Subsidiaries, or any Environmental Liability related
in any way, directly or indirectly, to the Borrower or any of its Subsidiaries,
or (iv) any actual or prospective claim, litigation, investigation or proceeding
relating to any of the foregoing, whether based on contract, tort or any other
theory and regardless of whether any Indemnitee is a party thereto; provided
that such indemnity shall not, as to any Indemnitee, be available to the extent
that such losses, claims, damages, liabilities or related expenses are
determined by a court of competent jurisdiction by final and nonappealable
judgment to have resulted from the gross negligence or willful misconduct of
such Indemnitee.

(c) To the extent that the Borrower fails to pay any amount required to be paid
by it to the Administrative Agent under paragraph (a) or (b) of this Section,
each Lender severally agrees to pay to the Administrative Agent such Lender’s
Applicable Percentage (determined as of the time that the applicable
unreimbursed expense or indemnity payment is sought) of such unpaid amount;
provided that the unreimbursed expense or indemnified loss, claim, damage,
liability or related expense, as the case may be, was incurred by or asserted
against the Administrative Agent in its capacity as such.

(d) To the extent permitted by applicable law, the Borrower shall not assert,
and hereby waives, any claim against any Indemnitee, on any theory of liability,
for special, indirect, consequential or punitive damages (as opposed to direct
or actual damages) arising out of, in connection with, or as a result of, this
Agreement or any agreement or instrument contemplated hereby, the Transactions,
any Loan or the use of the proceeds thereof.

(e) All amounts due under this Section shall be payable promptly after written
demand therefor.

SECTION 9.04 Successors and Assigns. (a) The provisions of this Agreement shall
be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns permitted hereby, except that (i) neither
Holdings nor the Borrower may assign or otherwise transfer any of its rights or
obligations hereunder without the prior written consent of

 

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each Lender (and any attempted assignment or transfer by Holdings or the
Borrower without such consent shall be null and void) and (ii) no Lender may
assign or otherwise transfer its rights or obligations hereunder except in
accordance with this Section. Nothing in this Agreement, expressed or implied,
shall be construed to confer upon any Person (other than the parties hereto,
their respective successors and assigns permitted hereby, Participants (to the
extent provided in paragraph (c) of this Section), Indemnitees and, to the
extent expressly contemplated hereby, the Related Parties of each of the
Administrative Agent and the Lenders) any legal or equitable right, remedy or
claim under or by reason of this Agreement.

(b) (i) Subject to the conditions set forth in paragraph (b)(ii) below, any
Lender may assign to one or more assignees all or a portion of its rights and
obligations under this Agreement (including all or a portion of its Commitment
and the Loans, reimbursements and other obligations at the time owing to it),
with the prior written consent (such consent not to be unreasonably withheld or
delayed) of the Administrative Agent, provided that no consent of the
Administrative Agent shall be required for an assignment of any Commitment or
Loan to an assignee that is a Lender hereunder immediately prior to giving
effect to such assignment, to a branch or an affiliate of an assigning Lender or
to an Approved Fund.

(ii) Assignments shall be subject to the following additional conditions:

(A) except in the case of an assignment to a Lender or an Affiliate of a Lender
or an assignment of the entire remaining amount of the assigning Lender’s Loans,
the amount of the Loans of the assigning Lender subject to each such assignment
(determined as of the date the Assignment and Assumption with respect to such
assignment is delivered to the Administrative Agent) shall not be less than
$1,000,000 unless the Administrative Agent otherwise consents;

(B) each partial assignment shall be made as an assignment of a proportionate
part of all the assigning Lender’s rights and obligations under this Agreement;

(C) the parties to each assignment shall execute and deliver to the
Administrative Agent an Assignment and Assumption, together with a processing
and recordation fee of $3,500;

(D) the assignee, if it shall not be a Lender, shall have executed and delivered
to the Administrative Agent a joinder agreement in the form of Exhibit K hereto
to each of the Existing Intercreditor Agreements; and

(E) the assignee, if it shall not be a Lender, shall deliver to the
Administrative Agent an Administrative Questionnaire in which the assignee
designates one or more credit contacts to whom all syndicate-level information
(which may contain material non-public information about the Borrower, the Loan
Parties and their related parties or their respective securities) will be made
available and who may receive such information in accordance with the assignee’s
compliance procedures and applicable laws, including Federal and state
securities laws.

 

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Notwithstanding any other provision in this Agreement, (x) if during the
Syndication Period UBS Securities LLC, in its capacity as underwriter, placement
agent or initial purchaser and bookrunner, shall be attempting to place or sell
senior unsecured debt securities of the Borrower (the “New Debt Securities”),
then during such portion of the Syndication Period in which there is an ongoing
road show with respect to New Debt Securities (including through funding or
closing if such road show results in pricing for the sale of New Debt
Securities) and (y) at any time during the Consent Period, neither the
Administrative Agent nor any Lender shall assign, or actively market the
assignment of, any Loans pursuant to this Section 9.04(b) without the prior
written consent of the Borrower (such consent not to be unreasonably withheld or
delayed); provided that in no event shall the Borrower’s consent be required for
any assignment to a Lender, an Affiliate of a Lender, an Approved Fund or, if an
Event of Default has occurred and is continuing, any other assignee.

For the purposes of this Section 9.04(b), the term “Approved Fund” has the
following meaning:

“Approved Fund” means any Person (other than a natural person) that is engaged
in making, purchasing, holding or investing in bank loans and similar extensions
of credit in the ordinary course of its business and that is administered or
managed by (a) a Lender, (b) an Affiliate of a Lender or (c) an entity or an
Affiliate of an entity that administers or manages a Lender.

(iii) Subject to acceptance and recording thereof pursuant to paragraph (b)(iv)
of this Section, from and after the effective date specified in each Assignment
and Assumption the assignee thereunder shall be a party hereto and, to the
extent of the interest assigned by such Assignment and Assumption, have the
rights and obligations of a Lender under this Agreement, and the assigning
Lender thereunder shall, to the extent of the interest assigned by such
Assignment and Assumption, be released from its obligations under this Agreement
(and, in the case of an Assignment and Assumption covering all of the assigning
Lender’s rights and obligations under this Agreement, such Lender shall cease to
be a party hereto but shall continue to be entitled to the benefits of
Sections 2.14, 2.15, 2.16 and 9.03). Any assignment or transfer by a Lender of
rights or obligations under this Agreement that does not comply with this
Section 9.04 shall be treated for purposes of this Agreement as a sale by such
Lender of a participation in such rights and obligations in accordance with
paragraph (c) of this Section.

(iv) The Administrative Agent, acting for this purpose as an agent of the
Borrower, shall maintain at one of its offices a copy of each Assignment and
Assumption delivered to it and a register for the recordation of the names and
addresses of the Lenders, and the Commitment of, and principal amount, Type and
Interest Period of the Loans owing to, each Lender pursuant to the terms hereof
from time to time (the “Register”). The Register shall also set forth the amount
of any sum received by the Administrative Agent hereunder for the account of the
Lenders and such Lender’s share

 

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thereof. The entries in the Register shall be conclusive, and the Borrower, the
Administrative Agent and the Lenders may treat each Person whose name is
recorded in the Register pursuant to the terms hereof as a Lender hereunder for
all purposes of this Agreement, notwithstanding notice to the contrary. The
Register shall be available for inspection by the Borrower and any Lender, at
any reasonable time and from time to time upon reasonable prior notice.

(v) Upon its receipt of a duly completed Assignment and Assumption executed by
an assigning Lender and an assignee, the assignee’s completed Administrative
Questionnaire (unless the assignee shall already be a Lender hereunder), the
processing and recordation fee referred to in paragraph (b) of this Section and
any written consent to such assignment required by paragraph (b) of this
Section, the Administrative Agent shall accept such Assignment and Assumption
and record the information contained therein in the Register; provided that if
either the assigning Lender or the assignee shall have failed to make any
payment required to be made by it pursuant to Section 2.06(b), 2.17(d) or
9.03(c), the Administrative Agent shall have no obligation to accept such
Assignment and Assumption and record the information therein in the Register
unless and until such payment shall have been made in full, together with all
accrued interest thereon. No assignment shall be effective for purposes of this
Agreement unless it has been recorded in the Register as provided in this
paragraph.

(c) (i) Any Lender may, without the consent of the Borrower or the
Administrative Agent, sell participations to one or more banks or other entities
(a “Participant”) in all or a portion of such Lender’s rights and obligations
under this Agreement (including all or a portion of its Commitment and the
Loans, reimbursements and other obligations owing to it) solely to the extent
(x) (1) required by law or regulation, (2) such Lender’s risk managers determine
(and advise the Borrower in writing) that doing so is advisable in view of safe
and sound risk management practices or (3) failure to do so would reasonably
jeopardize such Lender’s ability to address regulatory concerns, and (y) such
Lender shall have provided the Borrower such notice of the same as is reasonable
under the circumstances; provided that (A) such Lender’s obligations under this
Agreement shall remain unchanged, (B) such Lender shall remain solely
responsible to the other parties hereto for the performance of such obligations
and (C) the Borrower, the Administrative Agent and the other Lenders shall
continue to deal solely and directly with such Lender in connection with such
Lender’s rights and obligations under this Agreement. Any agreement or
instrument pursuant to which a Lender sells such a participation shall provide
that such Lender shall retain the sole right to enforce this Agreement and to
approve any amendment, modification or waiver of any provision of this
Agreement; provided that such agreement or instrument may provide that such
Lender shall not, without the consent of the Participant, agree to any
amendment, modification or waiver described in the first proviso to
Section 9.02(b) that affects such Participant. Subject to paragraph (c)(ii) of
this Section, the Borrower agrees that each Participant shall be entitled to the
benefits of Sections 2.14, 2.15 and 2.16 to the same extent as if it were a
Lender and had acquired its interest by assignment pursuant to paragraph (b) of
this Section. To the extent permitted by law, each Participant also shall be
entitled to the benefits of Section 9.10 as though it were a Lender, provided
such Participant agrees to be subject to Section 2.17(c) as though it were a
Lender.

 

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(ii) A Participant shall not be entitled to receive any greater payment under
Section 2.14 or 2.16 than the applicable Lender would have been entitled to
receive with respect to the participation sold to such Participant, unless the
sale of the participation to such Participant is made with the Borrower’s prior
written consent. A Participant that would be a Foreign Lender if it were a
Lender shall not be entitled to the benefits of Section 2.16 unless the Borrower
is notified of the participation sold to such Participant and such Participant
agrees, for the benefit of the Borrower, to comply with Section 2.16(e) as
though it were a Lender.

(d) Any Lender may at any time pledge or assign a security interest in all or
any portion of its rights under this Agreement to secure obligations of such
Lender, including without limitation any pledge or assignment to secure
obligations to a Federal Reserve Bank, and this Section shall not apply to any
such pledge or assignment of a security interest; provided that no such pledge
or assignment of a security interest shall release a Lender from any of its
obligations hereunder or substitute any such pledgee or assignee for such Lender
as a party hereto.

SECTION 9.05 Agreements of Holdings. (a) Holdings hereby agrees that it will be
bound by each of the covenants in Article V and Article VI of this Agreement as
if named therein as the Borrower (except that references to its Subsidiaries
shall not include any Person that is not the Borrower or a Subsidiary of the
Borrower), except as provided in Schedule 9.05(a), until such time as (a) the
Release Date shall have occurred and (b) all of the operating assets of Holdings
necessary for the conduct of the Borrower’s business (other than the XM-4
Satellite Collateral) have been transferred to the Borrower or any Subsidiary
Loan Party (the “Holdings Collateral Transfer”) and Holdings shall have
delivered a notice to the Administrative Agent in the form of Exhibit H hereto
(the “Holdings Covenant and Collateral Release Notice”) certifying that such
Holdings Collateral Transfer has occurred (the “Holdings Covenant and Collateral
Release Date”). From and after the Holdings Covenant and Collateral Release
Date, (i) Holdings shall not be bound by any of the covenants in Article V or
Article VI (other than Sections 5.10, 6.03(a), 6.11(a), 6.11(d) and 6.13, to
which it shall continue to be bound as if named therein as the Borrower) of this
Agreement and (ii) the representations and warranties in Sections 3.04(c), 3.05,
3.11, 3.13 and 3.14, as such representations and warranties apply to Holdings,
shall be limited as provided Schedule 9.05(b).

(b) Holdings agrees that at all times, whether before, on or after the date of
the first extension of credit under this Agreement and whether before, on or
after the Holdings Covenant and Collateral Release Date, it shall not incur
secured Indebtedness other than Permitted Holdings Debt, its Guarantor
Obligations and its Obligations as a guarantor under the Revolving Credit
Facility Documents.

(c) For the avoidance of doubt, the parties hereto agree (x) that the Excluded
Entities shall not be restricted by the covenants set forth in Articles V and VI
hereof, and (y) that liabilities appearing on the consolidated balance sheet of
Holdings which are liabilities of one or more Excluded Entities but which are
not liabilities of Holdings shall not be considered liabilities of Holdings for
purposes of determining compliance by Holdings with any of the covenants set
forth in Articles V or VI hereof.

 

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SECTION 9.06 XM-4 Satellite Collateral. In the event that the XM-4 Satellite
Collateral shall no longer constitute “Collateral” in accordance with the terms
hereof and one or more of the Loan Parties creates a security interest in all or
part of the XM-4 Satellite Collateral in favor of secured parties other than the
New Secured Parties and the Revolving Credit Facility Secured Parties, the Loan
Parties shall have the right to enter into license and/or access agreements in
form and substance reasonably acceptable to the Administrative Agent (and which
agreements shall be deemed acceptable so long as and to the extent that they
cover only such matters described in this Section 9.06 in the manner set forth
herein) (it being understood that the Administrative Agent shall not be entitled
to approve the commercial terms of any such license agreement unless any such
term contravenes this Section 9.06) under which the Loan Parties shall grant to
the representative of such secured parties one or more licenses (which may be
royalty free) or other rights to use, and reasonable access to, Indivisible
Ancillary XM-4 Satellite Collateral; provided that the Loan Parties certify to
the Administrative Agent that such use of and/or access will not impair in any
material respect the use or access to such Indivisible Ancillary XM-4 Satellite
Collateral by any of the Loan Parties in the conduct of their business. At the
request of the Loan Parties, the Administrative Agent shall consent to such
agreements and enter into one or more agreements on terms reasonably acceptable
to the Administrative Agent whereby it agrees to be bound by the terms of such
license and access agreements in the event of any foreclosure by the
Administrative Agent on such Indivisible Ancillary XM-4 Satellite Collateral.

SECTION 9.07 Survival. All covenants, agreements, representations and warranties
made by the Borrower and Holdings herein and in the certificates or other
instruments delivered in connection with or pursuant to this Agreement shall be
considered to have been relied upon by the other parties hereto and shall
survive the execution and delivery of this Agreement and the making of any
Loans, regardless of any investigation made by any such other party or on its
behalf and notwithstanding that the Administrative Agent or any Lender may have
had notice or knowledge of any Default or incorrect representation or warranty
at the time any credit is extended hereunder, and shall continue in full force
and effect as long as the principal of or any accrued interest on any Loan or
any fee or any other amount payable under this Agreement is outstanding and
unpaid. The provisions of Sections 2.14, 2.15, 2.16, 2.17 and 9.03 and Article
VIII shall survive and remain in full force and effect regardless of the
consummation of the transactions contemplated hereby, the repayment of the Loans
or the termination of this Agreement or any provision hereof.

SECTION 9.08 Counterparts; Integration; Effectiveness. This Agreement may be
executed in counterparts (and by different parties hereto on different
counterparts), each of which shall constitute an original, but all of which when
taken together shall constitute a single contract. This Agreement and any
separate letter agreements with respect to fees payable to the Administrative
Agent constitute the entire contract among the parties relating to the subject
matter hereof and supersede any and all previous agreements and understandings,
oral or written, relating to the subject matter hereof. Except as provided in
Section 4.01, this Agreement shall become effective when it shall have been
executed by the Administrative Agent and when the Administrative Agent shall
have received counterparts hereof which, when taken together, bear the
signatures of each of the other parties hereto, and thereafter shall be binding
upon and inure to the benefit of the parties hereto and their respective
successors and assigns. Delivery of an executed counterpart of a signature page
of this Agreement by telecopy shall be effective as delivery of a manually
executed counterpart of this Agreement.

 

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SECTION 9.09 Severability. Any provision of this Agreement held to be invalid,
illegal or unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such invalidity, illegality or unenforceability
without affecting the validity, legality and enforceability of the remaining
provisions hereof; and the invalidity of a particular provision in a particular
jurisdiction shall not invalidate such provision in any other jurisdiction.

SECTION 9.10 Right of Setoff. If an Event of Default shall have occurred and be
continuing, each Lender and each of its Affiliates is hereby authorized at any
time and from time to time, to the fullest extent permitted by law, to set off
and apply any and all deposits (general or special, time or demand, provisional
or final) at any time held and other obligations at any time owing by such
Lender or Affiliate to or for the credit or the account of the Borrower against
any of and all the obligations of the Borrower now or hereafter existing under
this Agreement held by such Lender or Affiliate, irrespective of whether or not
such Lender or Affiliate shall have made any demand under this Agreement and
although such obligations may be unmatured. The rights of each Lender and each
of its Affiliates under this Section are in addition to other rights and
remedies (including other rights of setoff) which such Lender or Affiliate may
have.

SECTION 9.11 Governing Law; Jurisdiction; Consent to Service of Process.
(a) This Agreement shall be construed in accordance with and governed by the law
of the State of New York.

(b) Each of Holdings and the Borrower hereby irrevocably and unconditionally
submits, for itself and its property, to the nonexclusive jurisdiction of the
Supreme Court of the State of New York sitting in New York County and of the
United States District Court of the Southern District of New York, and any
appellate court from any thereof, in any action or proceeding arising out of or
relating to this Agreement, or for recognition or enforcement of any judgment,
and each of the parties hereto hereby irrevocably and unconditionally agrees
that all claims in respect of any such action or proceeding may be heard and
determined in such New York State or, to the extent permitted by law, in such
Federal court. Each of the parties hereto agrees that a final judgment in any
such action or proceeding shall be conclusive and may be enforced in other
jurisdictions by suit on the judgment or in any other manner provided by law.
Nothing in this Agreement shall affect any right that the Administrative Agent
or any Lender may otherwise have to bring any action or proceeding relating to
this Agreement against the Borrower or its properties in the courts of any
jurisdiction.

(c) Each of Holdings and the Borrower hereby irrevocably and unconditionally
waives, to the fullest extent it may legally and effectively do so, any
objection which it may now or hereafter have to the laying of venue of any suit,
action or proceeding arising out of or relating to this Agreement in any court
referred to in paragraph (b) of this Section. Each of the parties hereto hereby
irrevocably waives, to the fullest extent permitted by law, the defense of an
inconvenient forum to the maintenance of such action or proceeding in any such
court.

 

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(d) Each party to this Agreement irrevocably consents to service of process in
the manner provided for notices in Section 9.01. Nothing in this Agreement will
affect the right of any party to this Agreement to serve process in any other
manner permitted by law.

SECTION 9.12 WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY
JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING
TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER BASED ON
CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO
REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY
OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK
TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER
PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER
THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.

SECTION 9.13 Headings. Article and Section headings and the Table of Contents
used herein are for convenience of reference only, are not part of this
Agreement and shall not affect the construction of, or be taken into
consideration in interpreting, this Agreement.

SECTION 9.14 Confidentiality. (a) Each of the Administrative Agent and the
Lenders agrees to maintain the confidentiality of the Information (as defined
below), except that Information may be disclosed (i) to its and its Affiliates’
directors, officers, employees and agents, including accountants, legal counsel
(including outside counsel), auditors (including independent auditors), and
other advisors (it being understood that the Persons to whom such disclosure is
made will be informed of the confidential nature of such Information and
instructed to keep such Information confidential), (ii) to the extent requested
by any regulatory authority, (iii) to the extent required by applicable laws or
regulations or by any subpoena or similar legal process, (iv) to any other party
to this Agreement, (v) in connection with the exercise of any remedies hereunder
or any suit, action or proceeding relating to this Agreement or the enforcement
of rights hereunder, (vi) subject to an agreement containing provisions
substantially the same as those of this Section, to (x) any assignee of or
Participant in, or any prospective assignee of or Participant in, any of its
rights or obligations under this Agreement or (y) any actual or prospective
counterparty (or its advisors) to any swap or derivative transaction relating to
the Borrower and its obligations, (vii) with the consent of the Borrower or
(viii) to the extent such Information (x) becomes publicly available other than
as a result of a breach of this Section or (y) becomes available to the
Administrative Agent or any Lender or its Affiliates on a nonconfidential basis
from a source other than the Borrower. For the purposes of this Section,
“Information” means all information received from the Borrower relating to the
Borrower or its business, other than any such information that is available to
the Administrative Agent or any Lender on a nonconfidential basis prior to
disclosure by the Borrower; provided that, in the case of information received
from the Borrower after the date hereof, such information is clearly identified
at the time of delivery as confidential. Any Person required to maintain the
confidentiality of Information as provided in this Section shall be considered
to have complied with its obligation to do so if such Person has exercised the
same degree of care to maintain the confidentiality of such Information as such
Person would accord to its own confidential information.

 

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(b) EACH LENDER ACKNOWLEDGES THAT INFORMATION AS DEFINED IN SECTION 9.14(a)
FURNISHED TO IT PURSUANT TO THIS AGREEMENT MAY INCLUDE MATERIAL NON-PUBLIC
INFORMATION CONCERNING THE BORROWER AND ITS RELATED PARTIES OR THEIR RESPECTIVE
SECURITIES, AND CONFIRMS THAT IT HAS DEVELOPED COMPLIANCE PROCEDURES REGARDING
THE USE OF MATERIAL NON-PUBLIC INFORMATION AND THAT IT WILL HANDLE SUCH MATERIAL
NON-PUBLIC INFORMATION IN ACCORDANCE WITH THOSE PROCEDURES AND APPLICABLE LAW,
INCLUDING FEDERAL AND STATE SECURITIES LAWS.

(c) ALL INFORMATION, INCLUDING REQUESTS FOR WAIVERS AND AMENDMENTS, FURNISHED BY
THE BORROWER OR THE ADMINISTRATIVE AGENT PURSUANT TO, OR IN THE COURSE OF
ADMINISTERING, THIS AGREEMENT WILL BE SYNDICATE-LEVEL INFORMATION, WHICH MAY
CONTAIN MATERIAL NON-PUBLIC INFORMATION ABOUT THE BORROWER, THE LOAN PARTIES AND
THEIR RELATED PARTIES OR THEIR RESPECTIVE SECURITIES. ACCORDINGLY, EACH LENDER
REPRESENTS TO THE BORROWER AND THE ADMINISTRATIVE AGENT THAT IT HAS IDENTIFIED
IN ITS ADMINISTRATIVE QUESTIONNAIRE A CREDIT CONTACT WHO MAY RECEIVE INFORMATION
THAT MAY CONTAIN MATERIAL NON-PUBLIC INFORMATION IN ACCORDANCE WITH ITS
COMPLIANCE PROCEDURES AND APPLICABLE LAW.

SECTION 9.15 Interest Rate Limitation. Notwithstanding anything herein to the
contrary, if at any time the interest rate applicable to any Loan, together with
all fees, charges and other amounts which are treated as interest on such Loan
under applicable law (collectively the “Charges”), shall exceed the maximum
lawful rate (the “Maximum Rate”) which may be contracted for, charged, taken,
received or reserved by the Lender holding such Loan in accordance with
applicable law, the rate of interest payable in respect of such Loan hereunder,
together with all Charges payable in respect thereof, shall be limited to the
Maximum Rate and, to the extent lawful, the interest and Charges that would have
been payable in respect of such Loan but were not payable as a result of the
operation of this Section shall be cumulated and the interest and Charges
payable to such Lender in respect of other Loans or periods shall be increased
(but not above the Maximum Rate therefor) until such cumulated amount, together
with interest thereon at the Federal Funds Effective Rate to the date of
repayment, shall have been received by such Lender.

SECTION 9.16 USA PATRIOT Act. Each Lender and the Administrative Agent hereby
notifies the Loan Parties that pursuant to the requirements of the Act, it is
required to obtain, verify and record information that identifies the Loan
Parties, which information includes the name and address of the Loan Parties and
other information that will allow such Lender or the Administrative Agent, as
applicable, to identify the Loan Parties in accordance with the Act.

 

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed by their respective authorized officers as of the day and year first
above written.

 

XM SATELLITE RADIO INC.,

as Borrower

By  

/s/ Joseph J. Euteneuer

Name:   Joseph J. Euteneuer Title:   Executive Vice President and Chief
Financial Officer XM SATELLITE RADIO HOLDINGS INC. By  

/s/ Joseph J. Euteneuer

Name:   Joseph J. Euteneuer Title:   Executive Vice President and Chief
Financial Officer

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UBS AG, STAMFORD BRANCH,

as Administrative Agent,

By  

/s/ Mary E. Evans

Name:   Mary E. Evans Title:   Associate Director By  

/s/ Irja R. Otsa

Name:   Irja R. Otsa Title:   Associate Director

UBS LOAN FINANCE LLC,

as a Lender

By  

/s/ Mary E. Evans

Name:   Mary E. Evans Title:   Associate Director By  

/s/ Irja R. Otsa

Name:   Irja R. Otsa Title:   Associate Director