In addition, SkyTerra and MSV have entered into a Master Contribution and Support Agreement with affiliates of Harbinger with respect to the possible combination of SkyTerra and Inmarsat plc, a UK public listed company and a leading provider of global mobile satellite communications services.

Inmarsat is not a party to the Master Agreement.

"Obtaining this financing is a significant milestone for SkyTerra and MSV," said Alexander H. Good, SkyTerra's Chairman, CEO and President.

"We have obtained committed financing for our period of greatest financial need-through the launch of our MSV-1 satellite to the time we expect to launch MSV-2. We now look forward to bringing to market the advanced services we believe will set a high-water mark for the MSS/ATC industry, and extend the marketplace for satellite services far beyond their historical bounds.

"This revolutionary satellite system is expected to provide service for at least 15 years and will ring in the era of integrated satellite-terrestrial networks.

"We appreciate the strong financial support from Harbinger, a major investor that understands the capital we need and our approach to advancing both the MSS and terrestrial wireless industries.

"Additionally, the combination of SkyTerra and Inmarsat, assuming financial terms can be reached, makes a great deal of strategic and operational sense. It would greatly enhance spectrum efficiency and North American L-Band spectrum while providing a foundation for innovation in the global mobile satellite industry.

"Such innovation would include exciting new applications while preserving essential national defense, public safety, safety at sea, and aeronautical safety services. The combination would also provide opportunities for greater efficiencies and scale benefits and coordination in the pursuit of next generation integrated satellite-terrestrial networks, products and applications," Good concluded.

SkyTerra, MSV, and MSV Finance Co. entered into a Securities Purchase Agreement (the "Securities Purchase Agreement") with affiliates of Harbinger, pursuant to which MSV and MSV Finance Co. will issue to Harbinger up to $500,000,000 aggregate principal amount of 16.0% Senior Unsecured Notes due July 1, 2013 (the "Notes") in four tranches, with the first tranche available on January 6, 2009.

In conjunction with the issuance of Notes pursuant to the Securities Purchase Agreement, SkyTerra will issue to Harbinger warrants to purchase up to an aggregate of 25,000,000 shares of common stock of SkyTerra at an exercise price of $0.01 per share of common stock. The financing is not conditioned upon the commencement or consummation of a business combination with Inmarsat.

The Master Agreement provides for the possible combination of SkyTerra and Inmarsat, subject to the receipt of required regulatory and antitrust clearances. SkyTerra and Harbinger expect the regulatory approval process, which includes approval from the U.S. Federal Communications Commission, other telecommunications approvals, and antitrust clearances to take approximately 12 to 18 months.

Assuming receipt of satisfactory regulatory and antitrust approvals, the proposed business combination with Inmarsat would be structured as an offer by SkyTerra to acquire all of the issued and to be issued shares of Inmarsat not owned by Harbinger (the "Offer"), on terms to be determined by Harbinger and in accordance with the Master Agreement.

As a result of the timing of the regulatory approvals, it is not the intention of SkyTerra and Harbinger to announce the formal terms or structure of a possible Offer at this stage.

If Harbinger decides to proceed with the Offer following the receipt of required regulatory approvals, Harbinger will arrange for committed equity and debt financing to fund the Offer. SkyTerra would undertake to use its best efforts to assist Harbinger in obtaining debt financing.

To provide equity financing for the Offer, Harbinger may purchase newly issued shares of SkyTerra voting common stock for $2.4 billion in cash or such other amount as Harbinger may determine. The per share purchase price for the newly issued shares will be $10.00 per share subject to an adjustment ratchet relating to the successful Offer price paid for each Inmarsat share.

If the Offer price for each Inmarsat share is greater or lower than 535p then the purchase price for the newly issued SkyTerra shares will increase or decrease proportionately (adjustment ratchet).

The 535p per share and $10.00 per share prices are reference prices for the purposes of the Master Agreement and the arrangements between Harbinger and SkyTerra. The 535p per share does not constitute a term or reference price for the Offer.

No Offer pricing discussion has taken place with the board of Inmarsat and no determination has been made by SkyTerra or Harbinger as to any appropriate Offer price. SkyTerra shareholders other than Harbinger may participate in the equity financing for the Offer through a rights offering of voting common stock up to $100 million.

If the Offer is completed Harbinger would contribute to SkyTerra 132 million ordinary shares in Inmarsat and $37.6 million in aggregate principal value of 1.75% convertible bonds issued by Inmarsat and due in 2017, in each case currently owned by Harbinger and its affiliates.

Harbinger would also contribute to SkyTerra equity interests that Harbinger has relating to an option to acquire in TVCC Holding Company, LLC, which has a lease that provides it the exclusive right to use 5 MHz of nationwide spectrum from 1670-1675 MHz.

In exchange for such contributions, SkyTerra would issue to Harbinger new shares of voting common stock at $10.00 per share subject to the adjustment ratchet. Authorization of new shares of SkyTerra common stock to be issued in the transaction will be subject to SkyTerra shareholder approval.

Harbinger currently owns approximately 28.80% of the issued and outstanding ordinary shares of Inmarsat, and approximately 48.43% of the issued and outstanding shares of voting stock of SkyTerra. Upon completion of the proposed business combination of SkyTerra and Inmarsat, it is expected that Harbinger will own in excess of 85.0% of the outstanding voting stock of the combined entity.

Morgan Stanley acted as financial advisor and, Skadden, Arps, Slate, Meagher and Flom LLP acted as legal advisor to the Special Committee of the SkyTerra Board of Directors. Harbinger has retained the services of Merrill Lynch International, Weil Gotshal and Manges LLP, and Linklaters LLP for advice and counsel on these matters.

MSV and its Canadian joint venture partner, Mobile Satellite Ventures (Canada), Inc. deliver mobile wireless services in the U.S. and Canada. Mobile Satellite Ventures LP is owned and controlled by SkyTerra Communications.

Related Links
Mobile Satellite Ventures
The latest information about the Commercial Satellite Industry

Memory Foam Mattress Review

SPACE MEDIA NETWORK PROMOTIONS Solar Energy Solutions Tempur-Pedic Mattress Comparison ... Newsletters :: SpaceDaily :: SpaceWar :: TerraDaily :: Energy Daily XML Feeds :: Space News :: Earth News :: War News :: Solar Energy News