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EXHIBIT 10.29
PLEDGE AGREEMENT
This Pledge Agreement (this "Agreement") is entered into this 2nd day of
April, 1998, by and among Infocom Communications Network, Inc., a Philippine
corporation (the "Company"), Nextel International, Inc., a Washington
corporation ("NII"), and Jetcom, Inc., a Philippine corporation ("Jetcom" or the
"Pledgor").
RECITALS
A. The Company is entering into a Restructuring Agreement (the
"Restructuring Agreement") of even date herewith by and among the Company, NII,
Top Mega Enterprises Ltd., a Hong Kong corporation and indirect wholly owned
subsidiary of NII and Jetcom pursuant to which NII is purchasing certain
advances made by Jetcom to the Company.
B. A condition to NII's obligations under the Restructuring Agreement is
the execution of this Agreement.
C. In order to induce NII to enter into the Restructuring Agreement, the
Pledgor has agreed to pledge 339,500 of shares of the Company's Common Stock
owned by it (the "Shares") to NII as security for certain of the Pledgor's
representations and warranties under the Restructuring Agreement.
AGREEMENT
Now therefore, in consideration of the mutual promises contained herein,
the parties hereto agree as follows:
1. Pledged Stock
As used in this Agreement, the term "Pledged Stock" with respect to the
Pledgor shall mean and include (a) the Shares and (b) any securities (including,
without limitation, any stock dividend or other distribution or exchange of
stock in connection with the reorganization, recapitalization, reclassification
or increase or reduction of capital) to which The Pledgor shall become entitled
for any reason whatsoever as an addition to, and substitution for, or in
exchange for, the Shares.
2. Pledge
a. Pledge. To secure the due payment by Jetcom of any damages to NII
as a result of Jetcom's breach of its representations and warranties set forth
in Sections 3.4 and 3.5 of the Restructuring Agreement (the "Pledgor
Representations"), the Pledgor hereby pledges,
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assigns, hypothecates, delivers and sets over ("Pledges") to NII all of its
right, title and interest in the Pledged Stock, together with any proceeds of
the Pledged Stock, and hereby grants to NII a first priority security interest
in the Pledged Stock and the proceeds thereof, effective against all third
parties.
b. Legend. The Pledgor shall place or shall cause the Company to
place a legend on the stock certificate or certificates evidencing ownership of
the Pledged Stock (the "Certificates") stating that the shares represented by
the Certificates are subject to the restrictions imposed by this Agreement and
shall cause a notation to be made in the stock record books of the Company to
the effect that the Pledged Stock is subject to this Agreement, and the Pledgor
shall cause a copy of this Agreement to be attached to the stock record books of
the Company at all times while this Agreement remains in effect.
c. Substitution of Collateral. NII will consider in good faith any
request by the Pledgor for a substitution of alternative collateral for the
Pledged Stock.
3. Delivery of Certificate and Assignment
Upon the execution of the Restructuring Agreement and concurrently
herewith, the Pledgor shall deliver to the Company the certificate or
certificates evidencing ownership of the Shares, together with a stock power (or
assignment separate from certificate) endorsed in blank for such certificate or
certificates.
4. Warranties and Covenants
The Pledgor hereby covenants and warrants that it owns all of the Shares
free and clear from any lien, encumbrance, claim or security interest whatsoever
other than the security interest claimed hereby or any lien, encumbrance, claim
or security interest derived from the Company. The Pledgor agrees not to create,
cause, or permit the creation of any other lien or security interest in the
Pledged Stock without the prior written consent of the Company and NII. The
Pledgor agrees to be responsible for the payment of all documentary stamp taxes
payable as a result of the transactions contemplated hereby.
5. Voting Rights and Dividends
So long as NII shall not have provided Jetcom notice of a claimed breach
by the Pledgor of any Pledgor Representations:
(a) The Pledgor shall be entitled to exercise any and all voting and
other consensual rights pertaining to the Pledged Stock for any purpose not
inconsistent with the terms of this Agreement.
(b) Subject to Section 1(b), the Pledgor shall be entitled to receive
and retain any and all dividends paid in respect of the Pledged Stock, including
cash, securities and other property distributed in respect of, or in exchange
for, any of the Pledged Stock.
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After ten days' written notice by the Company or NII to the Pledgor
of the occurrence of any breach of the Pledgor Representations by the Pledgor,
(i) all rights of the Pledgor to exercise the voting and other consensual rights
pursuant to this Section 5 shall cease and such rights shall thereafter become
vested in NII, which shall thereupon have the sole right to exercise such voting
or other consensual rights, and (ii) all rights of the Pledgor to receive
dividends that it would otherwise be authorized to receive and retain pursuant
to this Section 5 shall cease, and all such rights shall thereupon become vested
in NII which shall thereupon have the sole right to receive and hold any such
dividends as collateral under this Agreement. All dividends that are received by
the Pledgor contrary to the provisions of this Section 5 shall be received in
trust for the benefit of NII, shall be segregated from other funds and shall
forthwith be paid over to NII as collateral herein. Upon the cure of any such
default, the Pledgor's rights to voting and dividends shall be reinstated.
6. Default
If Jetcom fails to satisfy its obligations to indemnify NII pursuant to
Section 12 of the Restructuring Agreement with respect to any claim relating to
a breach of the Pledgor Representations, NII shall have the right to vote the
Pledged Stock in any manner it desires and to enforce its rights as secured
party with respect to the Pledged Stock in any manner provided or permitted by
any applicable law, whether with or without judicial proceedings, including the
right to prosecute any action or proceeding in any court of competent
jurisdiction, at law or in equity, to enforce its rights and to realize upon its
security interest in the Pledged Stock and including the right to sell the
Pledged Stock at a private or public sale. Ten days shall be a reasonable period
of notification of any sale as to which notice is required by law. Any notice to
the Pledgor shall be sent to its address set forth herein and shall be effective
when so sent.
7. Recovery of Costs
If there is any default under this Agreement or any breach by the Pledgor
of the Pledgor Representations, the Pledgor shall be liable to NII for all costs
and expenses which NII may incur by reason thereof, including, but not being
limited to, reasonable attorneys' fees, whether with respect to investigating
any such default or matters relating thereto or ascertaining or determining
rights and remedies which may be available or which may be feasible to assert,
and all costs and expenses, including reasonable attorneys' fees, in any suits,
actions or proceedings, whether to assert or enforce any rights or remedies or
to foreclose any rights or claims of the Pledgor or to protect or preserve any
rights or remedies of NII, whether in a court of law or equity or in
receivership proceedings or proceedings under Philippine bankruptcy laws or
otherwise, and all of the foregoing shall be secured hereby.
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8. Cumulative Rights
The security and the rights provided by or in this instrument are
cumulative, and are in addition to any rights or security provided by or in any
other instrument or agreement, whether made or given by the Pledgor or by any
other person or persons. The exercise or nonexercise of any right or remedy
whether under this instrument or any other agreement or instrument shall not
preclude NII from exercising any other rights or remedies.
9. No Waiver
A waiver of any default shall not constitute a waiver of such or any other
default or of a subsequent default of the same nature.
10. Termination
Unless a claim shall have been brought against NII or any of its
successors or assigns relating to the issues covered by the Pledgor
Representations, this Agreement shall remain in full force and effect until the
earlier of (a) three months and 14 days following the date of Closing under the
Restructuring Agreement and (b) receipt by NII of written notice from the
Pledgor and Xxxxx Link Holdings Ltd. ("Xxxxx Link") to the effect that all
claims between them relating to the issues covered by the Pledgor
Representations have been resolved and that Xxxxx Link has no claims against NII
or its successors or assigns relating thereto, at which time this Agreement
shall terminate, and the Pledged Stock that has not theretofore been repurchased
or released or delivered shall be released to the Pledgor.
If a claim shall have been brought against NII or any of its successors or
assigns relating to the issues covered by the Pledgor Representations, this
Agreement shall remain in full force and effect until the earlier of (a) receipt
by NII of written notice from the Pledgor and Xxxxx Link to the effect that all
claims between them relating to the issues covered by the Pledgor
Representations have been resolved and that Xxxxx Link has no claims against NII
or its successors or assigns relating thereto and (b) a final and binding
judicial or arbitral decision relating to any claim against NII or its
successors or assigns and full satisfaction of all obligations of the Pledgor
relating thereto pursuant to Section 12 of the Restructuring Agreement, at which
time this Agreement shall terminate, and the Pledged Stock that has not
theretofore been repurchased or released or delivered shall be released to the
Pledgor.
11. Governing Law
This Agreement shall be in all respects governed by and construed according to
the laws of the Philippines.
[Signature page follows]
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
date first set forth above.
INFOCOM COMMUNICATIONS NETWORK, INC.
By: /s/ Xxxxxxx X. Xxxxxxx
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Its:
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NEXTEL INTERNATIONAL, INC.
By: /s/ Xxxxx X. Xxxxxxx
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Its: Vice President
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JETCOM, INC.
By: /s/ Xxxxxxx X. Xxxxxxx
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Its:
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Witness:
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