Worldspace and Sirius-XM reach agreement
Last week (June 18) an application was made at the Delaware Bankruptcy Court, which is supervising WorldSpace's Chapter 11 bankruptcy protection. The Motion was made by WorldSpace in order to conclude a disputed claim by XM Satellite Radio concerning a technology licensing agreement struck with one of XM's predecessors, American Mobile Satellite Corp (AMSC, and which now trades as SkyTerra Communications), in July 1998.
WorldSpace also agreed a number of other patent licensing deals, including the ‘CD Radio Patents' with AMSC/XM over the following years, not least a common stock purchase warrant made in July 2005.
Last week's Motion to the Court seeks to wrap up and terminate all these agreements except one ‘Technology Licensing Agreement', and free WorldSpace from any claims from XM. XM will pay, subject to the Court's approval, $76,483 plus a further $298,517 to WorldSpace "in satisfaction of all amounts owed under the Technology Licensing Agreement". Both parties also agree to end all other claims against one another.
WorldSpace, in its submission, explains that the settlement is in the best interest of both companies and that settling the dispute minimises further costs and fees.