EXHIBIT 99.6
X.X. Xxxx & C0., Inc.
00 XXXX XXXXXX, XXX XXXX, X.X. 00000
(000) 000-0000
December 8, 2004
Xx. Xxxxxxxx Xxxxxxx
Chief Financial Officer
Net Servicos de Comunicacao S/A
Rua Verbo Divino, 1356
Sao Paulo - SP 00000-000
Xxxxxx
Ladies and Gentlemen:
This Letter Agreement sets forth the terms and conditions pursuant to
which Net Servicos de Comunicacao S.A. (the "Company") has retained X. X. Xxxx &
Co., Inc. ("King") in connection with a proposed exchange offer and consent
solicitation.
The Company proposes to (i) exchange US$76,593,068 aggregate principal
amount of its 7.0% Senior Secured Notes due 2009 (the "New Securities") and cash
for all of its issued and outstanding US$97,692,000 aggregate principal amount
of 12 5/8% Senior Guaranteed Notes due 2004 (the" Existing Securities") and (ii)
solicit consents from holders of Existing Securities to amendments to certain
provisions to the indenture under which the Existing Securities were issued in
accordance with, and subject to, the terms and conditions set forth in the
Registration Statement filed by the Company with the Securities and Exchange
Commission (the "Commission") on November 8, 2004. Such offer to exchange and
consent solicitation is herein referred to as the "Exchange Offer".
1. The Company hereby retains King as Information Agent for advisory and
consulting services in connection with the Exchange Offer and requests and
authorizes King to contact, and to provide information with respect to the
Exchange Offer to, holders of the Existing Securities. For this purpose, King is
authorized to use, and will be supplied by the Company with as many copies as
King may reasonably request of, the following materials filed with the
Commission or publicly released (or to be filed or publicly released) by the
Company in connection with the Exchange Offer (collectively, the "Exchange Offer
Materials"): (i) a Prospectus; (ii) a Letter of Transmittal; (iii) press
releases and newspaper advertisements; (iv) letter to securities dealers, banks
and trust companies to their customers; and (v) any and all amendments or
supplements to any of
December 8, 2004
Page 2
the foregoing, In no event xxxx Xxxx make any recommendation to anyone regarding
whether to tender or refrain from tendering their Existing Securities. If such
advice is requested, King will respond that it is not authorized to give such
advice and shall recommend to the person requesting such advice that such person
consult with his or her financial advisor or broker.
2. The Company agrees to pay King as compensation for its services a fee
of $7,500, which is due upon the completion, expiration or termination, as the
case may be, of the Exchange Offer. In the event the Company extends the term of
the Exchange Offer, the Company agrees to pay King an additional fee of $500
for each such extension. In the event the Company requests King to provide
additional services, the Company agrees to pay King reasonable and customary
compensation, in an amount, if any, to be mutually agreed upon. The Company
further agrees to reimburse King for all reasonable out-of-pocket expenses
(including reasonable counsel's fees and disbursements) incurred by King in
retention hereunder. The Company further agrees and acknowledges that its
obligation under this paragraph 2 is not in any way conditional upon the
successful consummation of the Exchange Offer or dependent upon the amount of
Existing Securities acquired by the Company pursuant to the Exchange Offer.
3. The Company agrees that King shall have the right to pass upon and
approve any and all references to King in the Exchange Offer Materials. The
Company shall not file with the Commission, any other governmental or regulatory
authority or body or any court, or otherwise make public, any document
containing any reference to King unless and until King shall have approved such
reference (which approval shall not be unreasonably withheld).
4. The Company represents and warrants to King that:
(i) this letter agreement is a valid and binding agreement on the
Company's part;
(ii) all necessary corporate action will be duly taken by the
Company prior to the commencement of the Exchange Offer to authorize the
Exchange Offer, and the exchange of New Securities and cash for Existing
Securities in connection with the Exchange Offer;
(iii) all Exchange Offer Materials will comply, in all material
respects, with the Securities Act of 1933, as amended, and the Securities
Exchange Act of 1934, as amended, to the extent applicable, and the rules and
regulations of the Commission thereunder, and none of the Exchange Offer
Materials and no other report, filing,
December 8, 2004
Page 3
document, release or communication published or filed in connection with the
Exchange Offer, will contain any untrue or misleading statement of a material
fact or omit to state a material fact required to be stated therein or necessary
to make the statements made therein not misleading;
(iv) the Exchange Offer, and the exchange of New Securities and Cash
for Existing Securities in connection with the Exchange Offer, will comply, in
all material respects, with all applicable requirements of law including the
applicable rules or regulations of any governmental or regulatory authority or
body (other than required filings under the Securities Act of 1933, as amended,
and the Securities Exchange Act of 1934, as amended, to the extent applicable,
and the rules and regulations of the Commission promulgated thereunder) required
in connection with the making or consummation of the Exchange Offer (or, if any
such material consent, approval or filing is required it will be duly obtained
or made prior to the consummation of the Exchange Offer); and
(v) the Exchange Offer, and the exchange of New Securities and Cash
for Existing Securities in connection with the Exchange Offer, and the
execution, delivery and performance of this letter agreement, will not conflict
with or result in a violation of any of the provisions of the Company's articles
of association or by-laws.
5. The Company will advise King promptly of the occurrence of any event
which will cause it not to proceed with, or to withdraw or abandon, the Exchange
Offer. The Company will also advise King promptly of any proposal or requirement
to amend or supplement any of the Exchange Offer Materials.
6. The Company hereby agrees to indemnify and hold harmless King, King's
controlling person, officers, directors, employees, agents and representatives
(collectively, the "Indemnified Persons") from and against any and all losses,
claims, damages, liabilities and expenses whatsoever (including but no limited
to, all reasonable counsel fee, disbursements and other out-of-pocket expenses)
incurred by such Indemnified Persons in investigating, preparing to defend or
defending (or appearing or preparing for appearance as a witness in connection
with) any claim, litigation, proceeding, investigation, or governmental or stock
exchange inquiry, commenced or threatened or any claim whatsoever:
(i) arising out of or based upon any facts or circumstances constituting a
violation of, or in conflict with, any of the representations and warranties set
forth in paragraph 4 above; or
December 8, 2004
Page 4
(ii) arising out of, relating to, or in connection with the Exchange
Offer, except for the Indemnified Person's bad faith, willful misconduct or
gross negligence. The Company shall reimburse such Indemnified Persons for such
counsel fees and disbursements and other out-of-pocket expenses at such time as
they are paid or incurred by such Indemnified Persons. The foregoing indemnity
shall be in addition to any liability which the Company might otherwise have to
the Indemnified Persons.
7. King agrees to notify the Company promptly of the assertion of any
claim against any of the Indemnified Persons in connection with the Exchange
Offer and the Company agrees to notify King promptly of the assertion of any
claim against the Company or any of its officers, directors, employees or agents
in connection with the Exchange Offer. At the Company's election, unless there
is a conflict of interest, the defense of the Indemnified Person shall be
conducted by the Company's counsel who shall be satisfactory to King and the
Indemnified Persons who are defendants in the action or proceeding.
Notwithstanding the Company's election to assume the defense of such action or
proceeding, an Indemnified Person may employ separate counsel to represent it or
defend it in such action or proceeding and the Company will pay the reasonable
fees and expenses of such counsel as set forth above if such Indemnified Person
reasonably determines that there are defenses available to such Indemnified
Person which are different from, or in addition to, those available to the
Company, or if a conflict of interest exists which makes representation by
counsel chosen by the Company not advisable; provided however, unless there are
actual or potential conflicts of interest among the Indemnified Persons, the
Company will not be required to pay the fees and expenses of more than one
separate counsel for all Indemnified Persons in any jurisdiction in any single
action or proceeding. In any action or proceeding the defense of which the
Company assumes, the Indemnified Persons shall nevertheless be entitled to
participate in such action or proceeding and retain its own counsel at such
Indemnified Person's own expense. The Company shall not settle or compromise any
such action or proceeding without the Indemnified Person's prior written
consent, unless the terms of the settlement or compromise include an
unconditional release of any such Indemnified Person(s) form all liability or
loss arising out of such action or proceeding.
8. The representations and warranties contained in paragraphs 4 and 5
above and the indemnity agreement contained in paragraphs 6 and 7 above shall
remain operative and in full force and effect regardless of: (i) the termination
or consummation of the Exchange Offer; and (ii) any investigation made by or on
behalf of any party.
9. This agreement shall be construed and enforced in accordance with the
laws of the State of New York. It is agreed that any action, suit or proceeding
arising out of or based upon this agreement shall be brought in the United
States District Court for the
December 8, 2004
Page 0
Xxxxxxxx Xxxxxxxx xx Xxx Xxxx or any court of the State of New York of competent
jurisdiction located in such District, and the parties hereto hereby consent to
the in personam jurisdiction and venue of any such court and to service of
process by certified mail, return receipt requested.
If any provision of this agreement shall be held illegal or invalid by any
court, this agreement shall be construed and enforced as if such provision had
not been contained herein and shall be deemed an agreement between the parties
hereto to the fullest extent permitted by law.
December 8, 2004
Page 6
If the foregoing correctly sets forth the understanding between the
Company and King, please indicate acceptance thereof in the space provided below
for the purpose, whereupon this letter and the Company's acceptance shall
constitute a binding agreement between the parties hereto.
X. X. XXXX & CO., INC.
BY: /s/ Xxxxxx X. Xxxx
----------------------------------
Name: Xxxxxx X. Xxxx
Title: Executive Vice President
Accepted as of the date first above written Net Servicos de Comunicacao S.A.
BY: /s/ Xxxxxxxx X.X. Xxxxxxx
-----------------------------------
Name: Xxxxxxxx Xxxxxxx
Title: Chief Financial Officer
BY: /s/ Xxxxxxxx xx Xxxx Mousinho
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Name: Xxxxxxxx xx Xxxx Mousinho
Title: Director
