LightSquared missed a $56.25 million payment to Inmarsat that was due...
LightSquared missed a $56.25 million payment to Inmarsat that was due as part of a spectrum agreement between the two companies, Inmarsat said Monday. While Inmarsat has issued a notice of default to LightSquared, LightSquared said Inmarsat has additional obligations…
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to fulfill before it is due that money. And an investor in Harbinger Capital Partners, LightSquared’s biggest investor, separately sued the hedge fund Friday over the investment in LightSquared. Within the first phase of the spectrum agreement, LightSquared and Inmarsat agreed to clean and swap their intertwined L-band spectrum in the U.S. Once completed, LightSquared was to pay Inmarsat $56.25 million, which Inmarsat said was due as of Monday. The agreement was signed in 2007. The default notice gives LightSquared 60 days to pay “before Inmarsat is entitled to enforce its rights and remedies under the agreement for payment default, including pre-agreed spectrum arrangements and termination of certain LightSquared rights under the Cooperation Agreement,” Inmarsat said. “Inmarsat and LightSquared have entered into discussions regarding the future of the Cooperation Agreement, but Inmarsat cannot provide any assurance that these discussions will result in any further payments being received from LightSquared,” Inmarsat said in a statement. LightSquared had a different take than Inmarsat. LightSquared “has raised several matters that require resolution before the first phase comes to a close,” it said Monday. “The terms of the agreement allow for additional time to resolve pending questions before phase one is complete and the final payment is due.” The FCC proposed last week to pull LightSquared’s terrestrial service authorization, severely limiting the company’s ability to achieve its wholesale wireless business plan. The FCC action also seemed to increase the likelihood of an investor suit against Harbinger, which has a substantial amount of its holding in LightSquared (CD Feb 16 p1). On Friday, Lili Schad sued Harbinger, seeking class action status, for investing too heavily in LightSquared and deviating from Harbinger’s original investment goals. Harbinger failed to disclose the regulatory obstacles to LightSquared’s business, said the filing in U.S. District Court for the Southern District of New York.