SUPPLEMENT TO SHARE PURCHASE AGREEMENT
THIS SUPPLEMENT TO SHARE PURCHASE AGREEMENT is made as of the 18th day
of August, 1997, by and between International Wireless Communications Holdings,
Inc., a Delaware corporation (the "Company"), and Continental Communications
Limited, a company established under the laws of the Republic of Ireland
("CCL").
RECITALS
WHEREAS, CCL has previously received 493,510 shares of IWCH common
stock pursuant to that certain Share Purchase Agreement between International
Wireless Communications Pakistan Limited and CCL, dated July 17, 1997; and
WHEREAS, IWCH and CCL wish to provide for an adjustment in the number
of shares of IWCH common stock ("IWCH Shares") that may be issued to CCL, and to
grant to CCL certain other rights as a stockholder of IWCH;
NOW, THEREFORE, in consideration of the mutual promises and covenants
set forth herein, the parties hereto agree as follows:
1. BOARD OBSERVATION RIGHTS. A representative of CCL (the "CCL
Representative") shall have the right to be present at all duly convened
meetings of the Board of Directors of IWCH (the "Board"); PROVIDED, HOWEVER,
that (a) in the event the Board intends to discuss or vote upon any matter in
which CCL may have an interest or any matter that is subject to the
attorney-client privilege, the CCL Representative may be excluded from the
portion of the meeting at which such matter is discussed by the vote of a
majority of the directors present; (b) IWCH may exclude from any meeting of the
Board the CCL Representative unless both CCL and its representative shall have
executed and delivered to IWCH a nondisclosure agreement, in the form to be
provided by IWCH; and (c) the Chairman of the Board may exclude from a meeting
of the Board of Directors the CCL Representative if CCL or any affiliate of CCL
is, or has an interest in, a direct or indirect competitor of IWCH, from any
discussion of matters relating to the area of competition.
2. ADJUSTMENTS. IWCH covenants and agrees as follows:
2.1 If, within 18 months of the sale and purchase of the
Pakistan Mobile Communications Limited ("PMCL") shares held by CCL (the "CCL
Closing"), an initial underwritten public offering of IWCH shares is consummated
(the "IPO"), and the valuation of IWCH made in connection with the IPO is less
than US$300,000,000, then, upon the consummation of the IPO, IWCH will issue to
CCL additional IWCH Shares, which number shall be the difference between (x)
US$6,159,000, divided by the IPO price per IWCH Share (excluding any
underwriting or similar discounts), and (y) 493,510 (which number represents the
total number of IWCH Shares issued to CCL as of the CCL Closing).
2.2 If, within 18 months of the CCL Closing, there is an IPO,
and the valuation of IWCH made in connection with the IPO is equal to or more
than US$300,000,000, then there shall be no adjustment made to the 493,510
IWCH Shares issued to CCL as of the CCL Closing.
2.3 If an IPO is not consummated within 18 months after the
CCL Closing, then, at the election of CCL, CCL shall have the right, by written
notice to IWCH, to:
(a) require IWCH to issue to CCL on the date that is
18 months after the CCL Closing, and on each anniversary of such date thereafter
until an IPO is consummated, 49,351 additional IWCH Shares; or
(b) require IWCH to file a registration statement
under the Securities Act of 1933, as amended (the "Act"), covering the
registration of the IWCH Shares issued to CCL. The Company shall, within ninety
(90) days of the receipt thereof, use all reasonable efforts to effect, as soon
as practicable, the registration under the Act of all IWCH Shares that CCL
requests to be registered.
(i) If CCL intends to distribute the IWCH Shares
covered by its request by means of an underwriting, it shall so advise IWCH as a
part of its request made pursuant to this subsection 2.3(b). In such event the
right of CCL to include the IWCH Shares in such registration shall be
conditioned upon CCL's participation in such underwriting. CCL shall enter into
an underwriting agreement in customary form with the underwriter or underwriters
selected for such underwriting by the Company (which underwriter or
underwriters shall be reasonably acceptable to CCL).
(ii) IWCH shall not be required to effect a
registration pursuant to this subsection 2.3(b):
A. in any particular jurisdiction in which IWCH
would be required to execute a general consent to service of process in
effecting such registration, unless IWCH is already subject to service in such
jurisdiction and may be required under the Act; or
B. after IWCH has effected one (1) registration
pursuant to this subsection 2.3(b), and such registration has been declared or
ordered effective; or
C. if IWCH shall furnish to CCL a certificate
signed by IWCH's Chief Executive Officer or Chairman of the Board stating that
in the good faith judgment of the Board of Directors of IWCH, it would be
seriously detrimental to IWCH and its stockholders for such registration
statement to be effected at such time, in which event IWCH shall have the right
to defer such filing for a period of not more than one hundred and twenty (120)
days after receipt of the request of CCL; provided that such right to delay a
request shall be exercised by IWCH not more than once in any twelve (12)-month
period; or
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D. until the first anniversary of the closing of
an IPO.
(iii) All expenses, other than underwriting discounts
and commissions, incurred in connection with registrations, filings or
qualifications pursuant to this subsection 2.3(b) and including (without
limitation) all registration, filing and qualification fees, printers' and
accounting fees, fees and disbursements of counsel for IWCH, shall be borne by
IWCH. Notwithstanding the foregoing, IWCH shall not be required to pay for any
expenses of any registration proceeding begun pursuant to this subsection 2.3(b)
if the registration request is subsequently withdrawn at the request of CCL.
(iv) It shall be a condition precedent to the
obligations of IWCH to take any action pursuant to this subsection 2.3(b) with
respect to the IWCH Shares that CCL shall furnish to IWCH such information
regarding itself, the IWCH Shares held by it, and the intended method of
disposition of such securities as shall be required to effect the registration
of CCL's IWCH Shares.
(v) If such registration statement is not filed
within six (6) months after the date of CCL's written notice to IWCH, CCL shall
have the right to sell its IWCH Shares to any third party purchaser for cash
consideration only.
(vi) If the net cash proceeds received by CCL from
any sale under subsection 2.3(b) above (net of reasonable costs and expenses
related to the sale of IWCH Shares) is less than US$6,159,000, then IWCH shall,
within five (5) business days after written notice from CCL, which notice shall
include supporting documentation, engage an appraiser to value IWCH. Within 10
days after the issuance of a report by the appraiser, based upon the valuation
in such report, IWCH shall issue warrants to CCL to purchase such number of
additional IWCH Shares with a value equivalent to the difference between
US$6,159,000 and such net cash proceeds. The valuation of such warrants shall
be determined in good faith by IWCH and shall be reasonably satisfactory to CCL.
2.4 If (x) an IPO is consummated after 18 months of the CCL
Closing, (y) CCL has exercised its rights under subsection 2.3(a) above, and (z)
the valuation of IWCH made in connection with the IPO is less than
US$300,000,000, then, upon the consummation of the IPO, IWCH will issue to CCL
additional IWCH Shares, which number shall be the difference between (i)
US$6,159,000, divided by the IPO price per IWCH Share (excluding any
underwriting or similar discounts) and (ii) 493,510 (which number represents the
number of IWCH Shares issued to CCL as of the CCL Closing).
2.5 If (x) an IPO is consummated after 18 months of the CCL
Closing, (y) CCL has exercised its rights under subsection 2.3(a) above, and (z)
the valuation of IWCH made in connection with the IPO is equal to or more than
US$300,000,000, then there shall be no adjustment made to the 493,510 IWCH
Shares issued to CCL as of the CCL Closing.
2.6 The valuation of IWCH in an IPO shall be calculated as the
IPO price per IWCH Share (excluding any underwriting or similar discounts)
multiplied by the sum
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of (a) the number of IWCH Shares outstanding at the IPO closing, (b) the number
of IWCH Shares issuable upon the exercise of in the money options and warrants
to purchase IWCH Shares outstanding at the IPO closing and (c) the number of
IWCH Shares issuable at the IPO closing upon the exchange of exchangeable notes
of IWCH and Pakistan Wireless Holdings Limited outstanding at the IPO closing.
3. IPO LOCK-UP. CCL hereby agrees that it will not, without the
prior written consent of the managing underwriter, during the period commencing
on the date of the final prospectus relating to the IPO, and ending on the date
specified by IWCH and the managing underwriter (such period not to exceed one
hundred eighty (l80) days), (i) lend, offer, pledge, sell, contract to sell,
sell any option or contract to purchase, purchase any option or contract to
sell, grant any option, right or warrant to purchase, or otherwise transfer or
dispose of, directly or indirectly, any of the IWCH Shares or any securities
convertible into or exercisable or exchangeable for IWCH Shares (whether such
shares or any such securities are then owned by CCL or are thereafter acquired),
or (ii) enter into any swap or other arrangement that transfers to another, in
whole or in part, any of the economic consequences of ownership of the IWCH
Shares, whether any such transaction described in clause (i) or (ii) above is to
be settled by delivery of IWCH Shares or such other securities, in cash or
otherwise; provided that all directors, executive officers and five percent (5%)
or greater beneficial owners of IWCH Shares enter into similar agreements. The
underwriters in connection with the IPO are intended third party beneficiaries
of this subsection 2.3(b)(iv) and shall have the right, power and authority to
enforce the provisions hereof as though they were a party hereto. In order to
enforce the foregoing covenant, IWCH may impose stop-transfer instructions with
respect to the IWCH Shares until the end of such period.
4. INDEMNIFICATION. In the event any IWCH Shares are included in a
registration statement under subsection 2.3(b) above.
4.1 To the extent permitted by law, IWCH will indemnify and
hold harmless each holder of IWCH Shares ("Holder"), the partners or officers,
directors and shareholders of each Holder, legal counsel and accountants for
each Holder, any underwriter (as defined in the Act) for such Holder and each
person, if any, who controls such Holder or underwriter within the meaning of
the Act or the Securities Exchange Act of 1934, as amended (the "1934 Act"),
against any losses, claims, damages, or liabilities (joint or several) to which
they may become subject under the Act, the 1934 Act or any state securities
laws, insofar as such losses, claims, damages, or liabilities (or actions in
respect thereof) arise out of or are based upon any of the following statements,
omissions or violations (collectively a "Violation"): (i) any untrue statement
or alleged untrue statement of a material fact contained in such registration
statement, including any preliminary prospectus or final prospectus contained
therein or any amendments or supplements thereto, (ii) the omission or alleged
omission to state therein a material fact required to be stated therein, or
necessary to make the statements therein not misleading, or (iii) any violation
or alleged violation by IWCH of the Act, the 1934 Act, any state securities laws
or any rule or regulation promulgated under the Act, the 1934 Act or any state
securities laws; and IWCH will reimburse each such Holder, underwriter or
controlling person for any legal or other expenses reasonably incurred by them
in connection with
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investigating or defending any such loss, claim, damage, liability, or action;
provided, however, that the indemnity agreement contained in this Section 4
shall not apply to amounts paid in settlement of any such loss, claim, damage,
liability, or action if such settlement is effected without the consent of IWCH
(which consent shall not be unreasonably withheld), nor shall IWCH be liable in
any such case for any such loss, claim, damage, liability, or action to the
extent that it arises out of or is based upon a Violation which occurs in
reliance upon and in conformity with written information furnished expressly for
use in connection with such registration by any such Holder, underwriter or
controlling person; provided further, however, that the foregoing indemnity
agreement with respect to any preliminary prospectus shall not inure to the
benefit of any Holder or underwriter, or any person controlling such Holder or
underwriter, from whom the person asserting any such losses, claims, damages or
liabilities purchased shares in the offering (the "Shares"), if a copy of the
prospectus (as then amended or supplemented if IWCH shall have furnished any
amendments or supplements thereto) was not sent or given by or on behalf of such
Holder or underwriter to such person, if required by law so to have been
delivered, at or prior to the written confirmation of the sale of the Shares to
such person, and if the prospectus (as so amended or supplemented) would have
cured the defect giving rise to such loss, claim, damage or liability.
4.2 To the extent permitted by law, each selling Holder will
indemnify and hold harmless IWCH, each of its directors, each of its officers
who has signed the registration statement, each person, if any, who controls
IWCH within the meaning of the Act, legal counsel and accountants for IWCH, any
underwriter, any other Holder selling securities in such registration statement
and any controlling person of any such underwriter or other Holder, against any
losses, claims, damages, or liabilities (joint or several) to which any of the
foregoing persons may become subject, under the Act, the 1934 Act or any state
securities laws, insofar as such losses, claims, damages, or liabilities (or
actions in respect thereto) arise out of or are based upon any Violation, in
each case to the extent (and only to the extent) that such Violation occurs in
reliance upon and in conformity with written information furnished by such
Holder expressly for use in connection with such registration; and each such
Holder will reimburse any person intended to be indemnified pursuant to this
Section 4, any legal or other expenses reasonably incurred in connection with
investigating or defending any such loss, claim, damage, liability, or action;
provided, however, that the indemnity agreement contained in this Section 4
shall not apply to amounts paid in settlement of any such loss, claim, damage,
liability or action if such settlement is effected without the consent of the
Holder (which consent shall not be unreasonably withheld) provided, that, in no
event shall any indemnity under this Section 4 exceed the gross proceeds from
the offering received by such Holder.
4.3 Promptly after receipt by an indemnified party under this
Section 4 of notice of the commencement of any action (including any
governmental action), such indemnified party will, if a claim in respect thereof
is to be made against any indemnifying party under this Section 4, deliver to
the indemnifying party a written notice of the commencement thereof and the
indemnifying party shall have the right to participate in, and, to the extent
the indemnifying party so desires, jointly with any other indemnifying party
similarly noticed, to assume the defense thereof with counsel mutually
satisfactory to the parties; provided, however, that an indemnified party
(together with all other indemnified parties which may be represented
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without conflict by one counsel) shall have the right to retain one separate
counsel, with the fees and expenses to be paid by the indemnifying party, if
representation of such indemnified party by the counsel retained by the
indemnifying party would be inappropriate due to actual or potential differing
interests between such indemnified party and any other party represented by such
counsel in such proceeding. The failure to deliver written notice to the
indemnifying party within a reasonable time of the commencement of any such
action, if prejudicial to its ability to defend such action, shall relieve such
indemnifying party of any liability to the indemnified party under this
Section 4, but the omission so to deliver written notice to the indemnifying
party will not relieve it of any liability that it may have to any indemnified
party otherwise than under this Section 4.
4.4 If the indemnification provided for in this Section 4 is
held by a court of competent jurisdiction to be unavailable to an indemnified
party with respect to any loss, liability, claim, damage, or expense referred to
therein, then the indemnifying party, in lieu of indemnifying such indemnified
party hereunder, shall contribute to the amount paid or payable by such
indemnified party as a result of such loss, liability, claim, damage, or expense
in such proportion as is appropriate to reflect the relative fault of the
indemnifying party on the one hand and of the indemnified party on the other in
connection with the statements or omissions that resulted in such loss,
liability, claim, damage, or expense as well as any other relevant equitable
considerations. The relative fault of the indemnifying party and of the
indemnified party shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact or the
omission to state a material fact relates to information supplied by the
indemnifying party or by the indemnified party and the parties' relative intent,
knowledge, access to information, and opportunity to correct or prevent such
statement.
4.5 Notwithstanding the foregoing, to the extent that the
provisions on indemnification and contribution contained in the underwriting
agreement entered into in connection with the underwritten public offering are
in conflict with the foregoing provisions, the provisions in the underwriting
agreement shall control.
4.6 The obligations of IWCH and the Holders under this
Section 4 shall survive the completion of any offering of IWCH Shares in a
registration statement under subsection 2.3(b) above, and otherwise.
5. MISCELLANEOUS.
5.1 IWCH OBLIGATIONS. IWCH shall have no further
responsibilities or obligations with regard to the IWCH Shares owned or to be
acquired by CCL pursuant to the terms of this Agreement, other than those
explicitly set forth herein.
5.2 SUCCESSORS AND ASSIGNS. Except as otherwise provided
herein, the terms and conditions of this Agreement shall inure to the benefit of
and be binding upon the respective successors and assigns of the parties.
Nothing in this Agreement, express or implied, is intended to confer upon any
party other than the parties hereto or their respective successors and assigns
any rights, remedies, obligations, or liabilities under or by reason of this
Agreement, except as expressly provided in this Agreement.
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5.3 GOVERNING LAW. This Agreement shall be governed by and
construed under the laws of the State of New York as applied to agreements among
New York residents entered into and to be performed entirely within New York.
5.4 COUNTERPARTS. This Agreement may be executed in two or
more counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
5.5 TITLES AND SUBTITLES. The titles and subtitles used in
this Agreement are used for convenience only and are not to be considered in
construing or interpreting this Agreement.
5.6 NOTICES. Unless otherwise provided, any notice required
or permitted under this Agreement shall be given in writing and shall be deemed
effectively given upon personal delivery to the party to be notified, two days
after deposit with an overnight courier service or five days after deposit with
the United States Post Office, by first class mail, postage prepaid and
addressed to the party to be notified at the address indicated for such party on
the signature page hereof, or at such other address as such party may designate
by ten (10) days' advance written notice to the other parties.
5.7 EXPENSES. If any action at law or in equity is necessary
to enforce or interpret the terms of this Agreement, the prevailing party shall
be entitled to reasonable attorneys' fees, costs and necessary disbursements in
addition to any other relief to which such party may be entitled.
5.8 ENTIRE AGREEMENT: AMENDMENTS AND WAIVERS. This Agreement
(including the Exhibits hereto, if any) constitutes the full and entire
understanding and agreement between the parties with regard to the subjects
hereof and thereof. Any term of this Agreement may be amended and the
observance of any term of this Agreement may be waived (either generally or in a
particular instance and either retroactively or prospectively), only with the
written consent of the Company and the holders of a majority of the IWCH Shares.
Any amendment or waiver effected in accordance with this paragraph shall be
binding upon each holder of any IWCH Shares, each future holder of all such IWCH
Shares, and IWCH.
5.9 SEVERABILITY. If one or more provisions of this Agreement
are held to be unenforceable under applicable law, such provision shall be
excluded from this Agreement and the balance of the Agreement shall be
interpreted as if such provision were so excluded and shall be enforceable in
accordance with its terms.
5.10 AGGREGATION OF STOCK. All of the IWCH Shares held or
acquired by affiliated entities or persons shall be aggregated together for the
purpose of determining the availability of any rights under this Agreement.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.
INTERNATIONAL WIRELESS
COMMUNICATIONS HOLDINGS, INC.
By: /s/ Xxxxxxx X. Xxxxxxxx
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Title: Executive Vice President
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CONTINENTAL COMMUNICATIONS LIMITED
By: /s/ S.M.J. Ford
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Title: Director
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