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EXHIBIT 10.7
MEMORANDUM
This MEMORANDUM is made and entered into as of March 11, 1998 by and
among J-COM Co., Ltd., a joint stock company organized under the laws of Japan
(the "Company"), DJSMR Business Partnership, a partnership organized under the
laws of Japan ("DJSMR Partnership"), Nippon Motorola Ltd., a company organized
under the laws of Japan and a wholly- owned subsidiary of Motorola, Inc.
("NML"), Nichimen Corporation, a company organized under the laws of Japan
("Nichimen") and ORIX Corporation, a company organized under the laws of Japan
("ORIX").
WHEREAS, the parties hereto entered into a certain Shareholders'
Agreement regarding the Company on December 15, 1997, as amended (the
"Shareholders' Agreement");
WHEREAS, Nextel International (Japan), Ltd. ("Nextel Japan") has
expressed its desire to become a Shareholder in accordance with the terms of
the Shareholders' Agreement, replacing NML as a Shareholder thereunder; and
WHEREAS, in order for Nextel Japan to be able to become a Shareholder
under the Shareholders' Agreement certain terms of the Shareholders' Agreement
must be modified to satisfy certain of Nextel International, Inc.'s indenture
requirements, as set forth in this Memorandum.
NOW THEREFORE, in consideration of the mutual covenants,
representations and warranties and subject to the terms and conditions
contained herein, the parties hereto agree as follows:
Section 1. Definitions. Unless otherwise defined herein, capitalized
terms used herein without definition shall have the same meanings as set forth
in the Shareholders' Agreement.
Section 2. Limitation on Restricted Payments. Notwithstanding anything to
the contrary in the Shareholders' Agreement, the affirmative votes of six (6)
of the Directors shall be required for any investment individually or in the
aggregate with all other investments to be made simultaneously in excess of
3,000,000,000 Yen, other than the following by the Company:
(a) direct obligations of the United States of America or any agency
thereof or obligations fully and unconditionally guaranteed by the
United States of America or any agency thereof;
(b) time deposit accounts, certificates of deposit and money market
deposits maturing within 180 days of the date of acquisition thereof
issued by a bank or trust company which is organized under the laws of
the United States of America,
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any state thereof or any foreign country recognized by the United
States, and which bank or trust company has capital, surplus and
undivided profits aggregating in excess of U.S. $50 million (or the
foreign currency equivalent thereof) and has outstanding debt which is
rated "A" (or such similar equivalent rating) or higher by at least
one internationally recognized statistical rating organization
(provided such internationally recognized statistical rating
organization's "A" rating is substantially similar to the "A" rating
of at least one U.S. nationally recognized statistical rating
organization) or any money-market fund sponsored by a registered
broker dealer or mutual fund distributor;
(c) repurchase obligations with a term of not more than 30 days for
underlying securities of the types described in clause (a) above
entered into with a bank meeting the qualifications described in
clause (b) above;
(d) commercial paper, maturing not more than 90 days after the date of
acquisition, issued by a corporation (other than an Affiliate of one
of the Shareholders) organized and in existence under the laws of the
United States of America, any state thereof or any foreign country
recognized by the United States of America with a rating at the time
as of which any investment therein is made of "P-1" (or higher)"
according to Xxxxx'x Investor Service, Inc. or its successors
("Moody's") or "A-1" (or higher) according to Standard & Poor's
Ratings Services or its successors ("S&P"); and
(e) securities with maturities of six months or less from the date of
acquisition issued or fully and unconditionally guaranteed by any
state, commonwealth or territory of the United States of America, or
by any political subdivision or taxing authority thereof, and rated at
least "A" by S&P or Moody's.
For purposes hereof, "investment" shall mean, as to any Person, any advance,
loan or other extension of credit or capital contribution to such Person or any
purchase or acquisition of capital stock, bonds, notes, debentures or other
similar instruments issued by such Person.
Section 3. Restrictions on Dividends. Notwithstanding anything to the
contrary in the Shareholders' Agreement, the payment of dividends by the
Company to the Shareholders shall be decided at a meeting of Shareholders by
the affirmative vote of a majority of the outstanding Shares, and the payment
of interim dividends by the Company to the Shareholders shall be decided at a
Board of Directors meeting by the affirmative vote of a majority of the
Directors; provided, however, that the payment of dividends or interim
dividends by the Company to the Shareholders shall require the affirmative vote
of two-thirds of the outstanding Shares at a meeting of Shareholders or of six
(6) of the Directors at a Board of Directors meeting, respectively, in the
event any of the Initial Loans, the Initial Leases, the Nippon Motorola Loan or
any other loans to the Company from the Shareholders remain outstanding.
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Section 4. Limitations on Indebtedness and Liens. Notwithstanding
anything to the contrary in the Shareholders' Agreement, the Company shall
notify Nextel Japan whenever the Company intends to incur any Indebtedness or
create any Liens other than those of which the affirmative vote of six (6) or
more Directors is required under Section 5.5 (iv), (v), (vi) or (xvi) of the
Shareholders' Agreement, as soon as possible prior to the incurrence of such
Indebtedness or the creation of such Liens. Notwithstanding anything to the
contrary in the Shareholders' Agreement, the term "Indebtedness" shall also
include (a) obligations in respect of letters of credit or other similar
instruments (including reimbursement obligations with respect thereto, but
excluding obligations with respect to (i) letters of credit securing
obligations entered into in the ordinary course of business to the extent such
letters of credit are not drawn upon or, if drawn upon, to the extent such
drawing is reimbursed no later than three business days following such demand
and (ii) letters of credit secured by cash collateral to the extent secured
thereby, (b) obligations in respect of the deferred and unpaid purchase price
of property or services due more than six months after the date such property
is delivered or such service is completed, (c) obligations in respect of
capitalized leases, and (d) obligations in respect of foreign exchange
contracts, currency swap agreements, interest rate protection agreements,
interest rate future agreements, interest rate option agreements, interest rate
swap agreements, interest rate cap agreements, interest rate collar agreements,
interest rate hedge agreements or other similar agreements or arrangements.
Section 5. Limitations on Sale-Leaseback Transactions. Notwithstanding
anything to the contrary in the Shareholders' Agreement, the affirmative votes
of six (6) of the Directors shall be required for any sale-leaseback
transaction by the Company if the term of the lease is for three years or
greater; provided that this restriction does not apply to such lease agreement
and agreements related thereto (including debt assumption agreements and
assignment agreements regarding the contractor agreements) that have been
approved in the Annual Business Plan.
Section 6. Conditions for the Amendments. The above amendments and
modifications to the Shareholders' Agreement shall be effective only to the
extent that Nextel Japan is a Shareholder of the Company and Nextel
International, Inc.'s indenture requirements require such modifications in
order to avoid default thereunder.
Section 7. Consent. By execution hereof, each of the parties hereto
gives its consent to have Nextel Japan become a Shareholder under the
Shareholders' Agreement in place of NML.
Section 8. No Other Change. Unless expressly stated herein, the terms
and conditions of the Shareholders' Agreement shall remain unchanged. All
references to the Shareholders' Agreement shall mean the Shareholders'
Agreement as amended and modified by this Memorandum.
Section 9. Counterparts. This Memorandum may be executed by the parties
hereto in separate counterparts, each of which when so executed and delivered
shall be an original, but all such counterparts shall together constitute but
one and the same document.
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Section 10. Governing Law. The laws of Japan shall apply to this
Memorandum. This Memorandum and the obligations of the parties hereto are
subject to all applicable laws, rules, court decisions, orders and regulations
of Japanese governmental authorities having jurisdiction; and in the event of
conflict, said laws, rules court decisions, orders and regulations of
governmental authorities having jurisdiction shall control.
Section 11. Language. This Memorandum has been made both in Japanese and
English and both the Japanese and English versions shall be originals, provided
that the Japanese version shall control.
IN WITNESS WHEREOF, the parties have caused this Memorandum to be
signed on its behalf by its duly authorized representative as of the date first
set forth above.
J-COM CO., LTD.
By: /s/ XXX XXXXXXXXXX
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Name: Xxx Xxxxxxxxxx
Title: Representative Director and President
DJSMR BUSINESS PARTNERSHIP
By: Nippon Motorola Ltd.
Executive Partner
By: /s/ XXXXXXX X. XXXXXX
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Name: Xxxxxxx X. Xxxxxx
Title: General Manager
Land Mobile Products Division
NIPPON MOTOROLA LTD.
By: /s/ XXXXX XXXX
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Name: Xxxxx Xxxx
Title: President and Representative Director
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NICHIMEN CORPORATION
By: /s/ XXXXXXX XXXXXXXXX
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Name: Xxxxxxx Xxxxxxxxx
Title: Managing Director
Senior General Manager
Plant & Project Division
ORIX CORPORATION
By: /s/ XXXXXXX XXXXXXXXX
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Name: Xxxxxxx Xxxxxxxxx
Title: Deputy General Manager
Computer Communications Department
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