XxXXX INTERNATIONAL, LTD.
PLACEMENT AGREEMENT
March 3, 1997
Xxxxxx Xxxxxxx & Co. Incorporated,
for itself and the other several Placement
Agents named below
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Dear Sirs:
XxXXX INTERNATIONAL, LTD., a Washington corporation (the "Company"),
proposes to issue and sell to you (the "Manager") and the other several
purchasers named in Schedule I hereto (collectively with the Manager, the
"Placement Agents") 951,463 Units (the "Units"). Each Unit will consist of (i)
one 13% Senior Discount Note due 2007 of the Company (the "Notes") to be issued
pursuant to the provisions of an Indenture (the "Indenture") dated as of the
Closing Date (as defined below) between the Company and The Bank of New York, as
trustee (in such capacity, the "Trustee") and (ii) one Warrant (collectively,
the "Warrants"), entitling the holder thereof to purchase 0.10616 shares of
common stock, without par value, of the Company (collectively, the "Warrant
Shares") from the Company at an exercise price of $36.45 per share, subject to
adjustment as provided in the Warrant Agreement (as defined below). The Warrants
will be issued pursuant to the provisions of a warrant agreement (the "Warrant
Agreement") dated as of the Closing Date (as defined below) between the Company
and The Bank of New York, as warrant agent (in such capacity, the "Warrant
Agent"), substantially in the form attached hereto as Exhibit A.
The Units will be offered without being registered under the Securities
Act of 1933, as amended (the "Securities Act"), to qualified institutional
buyers in compliance with the exemption from registration provided by Rule 144A
under the Securities Act, in offshore transactions in reliance on Regulation S
under the Securities Act ("Regulation S") and to institutional accredited
investors (as defined in Rule 501(a)(1), (2), (3) or (7) under the Securities
Act) that deliver a letter in the form annexed to the Final Memorandum (as
defined below).
The Placement Agents and their direct and indirect transferees will be
entitled to the benefits of a Registration Rights Agreement, dated the date
hereof and to be substantially in the form attached hereto as Exhibit B (the
"Registration Rights Agreement") and a Warrant Registration Rights Agreement,
dated the date hereof and to be substantially in the form attached hereto as
Exhibit C (the "Warrant Registration Rights Agreement").
In connection with the sale of the Units, the Company has prepared a
preliminary private placement memorandum (the "Preliminary Memorandum") and will
prepare a final private placement memorandum (the "Final Memorandum" and, with
the Preliminary Memorandum, each a "Memorandum") setting forth or including a
description of the terms of the Units, the Notes, the Warrants and the Warrant
Shares, the terms of the offering and a description of the Company and its
business.
1. Representations and Warranties. The Company represents and
warrants to, and agrees with, you that as of the date hereof:
(a) The Preliminary Memorandum does not contain and the Final
Memorandum, in the form used by the Placement Agents to confirm sales and on the
Closing Date (as defined below), will not contain any untrue statement of a
material fact or omit to state a material fact necessary to make the statements
therein, in the light of the circumstances under which they were made, not
misleading, except that the representations and warranties set forth in this
Section 1(a) do not apply to statements or omissions in either Memorandum based
upon information relating to any Placement Agent furnished to the Company in
writing by such Placement Agent through you expressly for use therein.
(b) The Company has been duly incorporated, is validly existing as a
corporation in good standing under the laws of the jurisdiction of its
incorporation, has the corporate power and authority to own its property and to
conduct its business as described in each Memorandum and is duly qualified to
transact business and is in good standing in each jurisdiction in which the
conduct of its business or its ownership or leasing of property requires such
qualification, except to the extent that the failure to be so qualified or be in
good standing would not have a material adverse effect on the Company and its
subsidiaries listed on Schedule II hereto (each a "Subsidiary" and collectively,
the "Subsidiaries"), taken as a whole.
(c) Each Subsidiary of the Company has been duly incorporated, is
validly existing as a corporation in good standing under the laws of the
jurisdiction of its incorporation (to the extent that such jurisdiction
recognizes the legal concept of good standing) and has the corporate power and
authority to own its property and to conduct its business as described in each
Memorandum and is duly qualified to transact business and is in good standing in
each jurisdiction (to the extent that such jurisiction recognizes the legal
concept of good standing) in which the conduct of its business or its ownership
or leasing of property requires such qualification, except to the extent that
the failure to be so qualified or be in good standing would not have a material
adverse effect on the Company and the Subsidiaries, taken as a whole.
(d) This Agreement has been duly authorized, executed and delivered by
the Company.
(e) The Notes have been duly authorized by the Company and, when
executed, authenticated and delivered to and paid for by the Placement Agents in
accordance with the terms of this Agreement, will (x) be valid and binding
obligations of the Company enforceable in accordance with their terms, except as
(A) the enforceability thereof may be limited by bankruptcy, insolvency or
similar laws relating to or affecting creditors' rights generally and (B) rights
of acceleration, if applicable, and the availability of equitable remedies may
be limited by equitable principles and (y) be entitled to the benefits of the
Indenture and the Registration Rights Agreement.
(f) The Indenture has been duly authorized by the Company and, when
executed and delivered by the Company, will be a valid and binding agreement of
the Company, enforceable in accordance with its terms except as (x) the
enforceability thereof may be limited by bankruptcy, insolvency or similar laws
relating to or affecting creditors' rights generally, (y) rights of
acceleration, if applicable, and the availability of equitable remedies may be
limited by equitable principles and (z) rights to indemnification and
contribution may be limited by public policy.
(g) The Registration Rights Agreement has been duly authorized,
executed and delivered by, and is a valid and binding agreement of, the Company,
enforceable in accordance with its terms except as (x) the enforceability
thereof may be limited by bankruptcy, insolvency or similar laws relating to or
affecting creditors' rights generally, (y) rights of acceleration, if
applicable, and the availability of equitable remedies may be limited by
equitable principles and (z) rights to indemnification and contribution may be
limited by public policy.
(h) The Warrants have been duly authorized by the Company and, when
executed, and countersigned by the Warrant Agent as provided in the Warrant
Agreement, and delivered to and paid for by the Placement Agents in accordance
with the terms of this Agreement, will (x) be valid and binding obligations of
the Company enforceable in accordance with their terms, except as (A) the
enforceability thereof may be limited by bankruptcy, insolvency or similar laws
relating to or affecting creditors' rights generally and (B) rights of
acceleration, if applicable, and the availability of equitable remedies may be
limited by equitable principles and (y) be entitled to the benefits of the
Warrant Agreement and the Warrant Registration Rights Agreement.
(i) The Warrant Agreement has been duly authorized by the Company and,
when executed and delivered by the Company, will be a valid and binding
agreement of the Company, enforceable in accordance with its terms except as
(x) the enforceability thereof may be limited by bankruptcy, insolvency or
similar laws relating to or affecting creditors' rights generally, (y) rights of
acceleration, if applicable, and the availability of equitable remedies may be
limited by equitable principles and (z) rights to indemnification and
contribution may be limited by public policy.
(j) The Warrant Registration Rights Agreement has been duly authorized,
executed and delivered by, and is a valid and binding agreement of, the Company,
enforceable in accordance with its terms except as (x) the enforceability
thereof may be limited by bankruptcy, insolvency or similar laws relating to or
affecting creditors' rights generally, (y) rights of acceleration, if
applicable, and the availability of equitable remedies may be limited by
equitable principles and (z) rights to indemnification and contribution may be
limited by public policy.
(k) The Warrant Shares issuable upon exercise of the Warrants have been
duly authorized and reserved by the Company and, when issued and delivered upon
exercise of the Warrants in accordance with the terms of the Warrants and the
Warrant Agreement, will be validly issued, fully paid and non-assessable and
will not be subject to any preemptive or similar rights.
(l) The execution and delivery by the Company of, and the performance
by the Company of its obligations under, this Agreement, the Indenture, the
Registration Rights Agreement, the Warrant Agreement, the Warrant Registration
Rights Agreement, the Notes and the Warrants (collectively, the "Transaction
Documents") and the issuance, sale and delivery of the Notes and the Warrants
and the issuance of the Warrant Shares upon exercise of the Warrants in
accordance with the terms of the Warrants and the Warrant Agreement by the
Company will not contravene (i) any provision of applicable law, (ii) the
certificate of incorporation or by-laws or partnership agreement, as the case
may be, of the Company or (iii) any agreement or other instrument binding upon
the Company or any of the Subsidiaries or any judgment, order or decree of any
governmental body, agency or court having jurisdiction over the Company or any
Subsidiary, except, with respect to clause (i) and (iii), to the extent that any
contravention would not have a material adverse effect on the Company and the
Subsidiaries, taken as a whole, and no permit, license, consent, approval,
authorization or order of, or filing, declaration or qualification with, any
governmental body or agency is required for the performance by the Company of
its obligations under the Transaction Documents, except such as may be required
by the securities or Blue Sky laws of the various states in connection with the
offer and sale of the Units, Notes or Warrants and except as to which the
failure to obtain would not have a material adverse effect on the ability of the
Company to perform its obligations under the Transaction Documents.
(m) There has not occurred any material adverse change, or any
development involving a prospective material adverse change, in the condition,
financial or otherwise, or in the earnings, business or operations of the
Company and the Subsidiaries, taken as a whole, from that set forth in the
Preliminary Memorandum. Furthermore, (1) the Company and the Subsidiaries have
not incurred any material liability or obligation, direct or contingent, nor
entered into any material transaction not in the ordinary course of business;
(2) the Company has not purchased any of its outstanding capital stock, nor
declared, paid or otherwise made any dividend or distribution of any kind on its
capital stock other than ordinary and customary dividends; and (3) there has not
been any material change in the capital stock, short-term debt or long-term debt
of the Company and the Subsidiaries taken as a whole, except in each case as
described in the Final Memorandum.
(n) There are no legal or governmental proceedings pending or, to the
knowledge of the Company, threatened to which the Company or any of the
Subsidiaries is a party or to which any of the properties of the Company or any
of the Subsidiaries is subject other than proceedings accurately described in
all material respects in each Memorandum and proceedings that are not reasonably
likely to have a material adverse effect on the Company and the Subsidiaries,
taken as a whole, or on the power or ability of the Company to perform its
obligations under the Transaction Documents or to consummate the transactions
contemplated by the Final Memorandum.
(o) Neither the Company nor any affiliate (as defined in Rule 501(b) of
Regulation D under the Securities Act, an "Affiliate") of the Company has
directly, or through any agent, (i) sold, offered for sale, solicited offers to
buy or otherwise negotiated in respect of, any security (as defined in the
Securities Act) which is or will be integrated with the sale of the Units, the
Notes or the Warrants in a manner that would require the registration under the
Securities Act of the Units, the Notes or the Warrants or (ii) engaged in any
form of general solicitation or general advertising in connection with the
offering of the Units, the Notes or the Warrants (as those terms are used in
Regulation D under the Securities Act) or in any manner involving a public
offering within the meaning of Section 4(2) of the Securities Act.
(p) The Company is not, and after giving effect to the offering and
sale of the Units, the Notes and the Warrants and the application of the
proceeds thereof as described in the Final Memorandum, will not be an
"investment company," as such term is defined in the Investment Company Act of
1940, as amended. The Company is not a "public utility holding company," as such
term is defined in the Public Utility Holding Company Act of 1935, as amended.
(q) It is not necessary in connection with the offer, sale and delivery
of the Units, the Notes and the Warrants to the Placement Agents in the manner
contemplated by this Agreement to register the Units, the Notes or the Warrants
under the Securities Act or to qualify the Indenture under the Trust Indenture
Act of 1939, as amended.
(r) Except as described in each Memorandum, each of the Company and the
Subsidiaries (i) has all necessary licenses, consents, authorizations,
approvals, orders, certificates and permits of and from, and has made all
declarations and filings with, all federal, state and local and foreign
governmental, administrative or regulatory authorities, all self-regulatory
organizations and all courts and other tribunals, to own, lease, license and use
its properties and assets and to conduct its business in the manner described in
or contemplated by each Memorandum, including providing digital enhanced
specialized mobile radio services, except to the extent that the failure to
obtain such licenses, consents, authorizations, approvals, orders, certificates
and permits or make such declarations and filings would not have a material
adverse effect on the Company and the Subsidiaries, taken as a whole and (ii)
has not received any notice of proceedings relating to the violation, revocation
or modification of any such license, consent, authorization, approval, order,
certificate or permit which, singly or in the aggregate, if the subject of an
unfavorable decision, ruling or finding, would reasonably be expected to result
in a material adverse change in the condition, financial or otherwise, or in the
earnings, business or operations of the Company and the Subsidiaries, taken as a
whole.
(s) The Company and the Subsidiaries (i) are in compliance with any and
all applicable foreign, federal, state and local and foreign laws and
regulations relating to the protection of human health and safety, the
environment or hazardous or toxic substances or wastes, pollutants or
contaminants, including all such laws and regulations concerning electromagnetic
radio frequency emissions ("Environmental Laws"); (ii) have received all
permits, licenses or other approvals required of them under applicable
Environmental Laws to conduct their respective businesses; and (iii) are in
compliance with all terms and conditions of any such permit, license or
approval, except where such noncompliance with Environmental Laws, failure to
receive required permits, licenses or other approvals or failure to comply with
the terms and conditions of such permits, licenses or approvals, singly or in
the aggregate, would not be reasonably likely to have a material adverse effect
on the Company and the Subsidiaries, taken as a whole.
(t) There are no costs or liabilities associated with Environmental
Laws (including, without limitation, any capital or operating expenditures
required for clean-up, closure of properties or compliance with Environmental
Laws or any permit, license or approval, any related constraints on operating
activities and any potential liabilities to third parties) which would, singly
or in the aggregate, be reasonably likely to have a material adverse effect on
the Company and the Subsidiaries, taken as a whole.
(u) None of the Company, its Affiliates or any person acting on its or
their behalf (other than the Placement Agents) has engaged in any directed
selling efforts (as that term is defined in Regulation S with respect to the
Units, the Notes or the Warrants and the Company and its Affiliates and any
person acting on its or their behalf (other than the Placement Agents) have
complied with the offering restrictions requirement of Regulation S.
(v) The Company and each of the Subsidiaries maintain a system of
internal accounting controls sufficient to provide reasonable assurance that (i)
transactions are executed in accordance with management's general or specific
authorizations; (ii) transactions are recorded as necessary to permit
preparation of financial statements in conformity with U.S. GAAP and to maintain
asset accountability; (iii) access to assets is permitted only in accordance
with management's general or specific authorization; and (iv) the recorded
accountability for assets is compared with the existing assets at reasonable
intervals and appropriate action is taken with respect to any differences.
(w) The Company and the Subsidiaries have good and marketable title in
fee simple to all real property and good and marketable title to all personal
property owned by them which is material to the business of the Company and the
Subsidiaries, taken as a whole, in each case free and clear of all liens,
encumbrances and defects, except such as are described in each Memorandum or
such as do not materially affect the value of such property and do not interfere
with the use made and proposed to be made of such property by the Company and
the Subsidiaries; and any real property and buildings held under lease by the
Company and the Subsidiaries are held by them under valid, subsisting and
enforceable leases with such exceptions as are not material and do not
materially interfere with the use made and proposed to be made of such property
and buildings by the Company and the Subsidiaries, in each case except as
described in or contemplated by each Memorandum.
(x) The Company and the Subsidiaries own or possess, or can acquire on
reasonable terms, all material patents, patent rights, licenses, inventions,
copyrights, know-how (including trade secrets and other unpatented and/or
unpatentable proprietary or confidential information, systems or procedures),
trademarks, service marks and trade names currently employed by them in
connection with the business now operated by them, and neither the Company nor
any of the Subsidiaries has received any notice of infringement of or conflict
with asserted rights of others with respect to any of the foregoing which,
singly or in the aggregate, if the subject of an unfavorable decision, ruling or
finding, would be reasonably likely to result in a material adverse change in
the condition, financial or otherwise, or in the earnings, business or
operations of the Company and the Subsidiaries, taken as a whole.
(y) No material labor dispute with the employees of the Company or any
of the Subsidiaries exists, except as described in or contemplated by each
Memorandum, or, to the knowledge of the Company, is imminent; and the Company is
not aware of any existing, threatened or imminent labor disturbance by the
employees of any of its principal suppliers, manufacturers or contractors that
would be reasonably likely to result in a material adverse change in the
condition, financial or otherwise, or in the earnings, business or operations of
the Company and the Subsidiaries, taken as a whole.
(z) The Company and each of the Subsidiaries are insured against such
losses and risks and in such amounts as are customary in the businesses in which
they are engaged; the Company has no reason to believe that either it or any
Subsidiary will not be able to renew its existing insurance coverage as and when
such coverage expires or obtain similar coverage from similar insurers as may be
necessary to continue its business at a cost that would not materially and
adversely affect the condition, financial or otherwise, or the earnings,
business or operations of the Company and the Subsidiaries, taken as a whole,
except as described in or contemplated by each Memorandum.
(aa) The pro forma financial statements included in each Memorandum
present fairly the information shown therein and, in the opinion of the Company,
the assumptions used in the preparation thereof are reasonable and the
adjustments used therein are appropriate to give effect to the transactions or
circumstances referred to therein.
(bb) None of the Company or any of the Subsidiaries has committed any
act in violation of the Foreign Corrupt Practices Act, as amended.
2. Offering. You have advised the Company that the Placement Agents
will make an offering of the Units purchased by the Placement Agents hereunder
on the terms set forth in the Final Memorandum as soon as practicable after this
Agreement is entered into as in your judgment is advisable.
3. Purchase and Delivery. The Company hereby agrees to sell to
the several Placement Agents, and the Placement Agents, upon the basis of the
representations and warranties herein contained, but subject to the conditions
hereinafter stated, agree, severally and not jointly, to purchase from the
Company the number of Units set forth in Schedule I hereto opposite their names
at a purchase price of $508.43 per Unit plus accrued amortization of original
issue discount on the Notes, if any, from March 6, 1997 to the date of payment
and delivery.
Payment for the Units shall be made against delivery of the Units at a
closing (the "Closing") to be held at the office of Shearman & Sterling, 000
Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx, at 9:00 A.M., local time, on March 6,
1997, or at such other time on the same or such other date, not later than March
20, 1997, as shall be designated in writing by you. The time and date of such
payment are herein referred to as the Closing Date. Payment for the Units shall
be made to the Company in federal funds or other funds immediately available in
New York City.
Certificates for the Units, the Notes and the Warrants shall be in
definitive form and registered in such names and in such denominations as you
shall request in writing not less than one full business day prior to the
Closing Date. The certificates evidencing the Units, the Notes and the Warrants
shall be delivered to you on the Closing Date for the respective accounts of the
several Placement Agents, with any transfer taxes payable in connection with the
transfer of the Units, the Notes or the Warrants to the Placement Agents duly
paid, against payment of the purchase price therefor.
4. Conditions to Closing. The several obligations of the
Placement Agents under this Agreement to purchase the Units will be subject to
the following conditions:
(a) Subsequent to the date of this Agreement and prior to the Closing
Date,
(i) there shall not have occurred any downgrading, nor shall any
notice have been given of any intended or potential downgrading or of any review
for a possible change that does not indicate the direction of the possible
change, in the rating accorded any of the Company's securities by any
"nationally recognized statistical rating organization," as such term is defined
for purposes of Rule 436(g)(2) under the Securities Act; and
(ii) there shall not have occurred any change, or any development
involving a prospective change, in the condition, financial or otherwise, or in
the earnings, business or operations, of the Company and the Subsidiaries, taken
as a whole, from that set forth in the Preliminary Memorandum that, in your
judgment, is material and adverse and that makes it, in your judgment,
impracticable to market the Units on the terms and in the manner contemplated in
the Final Memorandum.
(b) You shall have received on the Closing Date a certificate, dated
the Closing Date and signed by the Chief Financial Officer and the General
Counsel of the Company, to the effect set forth in clause (a)(i) above and to
the effect that the representations and warranties contained in this Agreement
are true and correct as of the Closing Date and that the Company has complied
with all of the agreements contained herein and satisfied all of the conditions
contained herein to be performed or satisfied on or before the Closing Date.
The officer signing and delivering such certificate may rely upon his
knowledge as to proceedings threatened.
(c) You shall have received on the Closing Date an opinion of Xxxxxxx
Coie, Washington counsel to the Company, dated the Closing Date, to the effect
set forth in Exhibit D.
(d) You shall have received on the Closing Date an opinion of
Xxxxxxxxxx & Xxxxx LLP, special counsel to the Company, dated the Closing Date,
to the effect set forth in Exhibit E.
(e) You shall have received on the Closing Date opinions of foreign
counsel to the Company in Brazil, Argentina, Mexico and Philippines, dated the
Closing Date, each to the effect set forth in Exhibit F.
(f) You shall have received on the Closing Date opinions of foreign
counsel to the Company in the Cayman Islands, dated the Closing Date, to the
effect set forth in Exhibit G.
(g) You shall have received on the Closing Date opinions of foreign
counsel to the Company in China, dated the Closing Date, to the effect set forth
in Exhibit H.
(h) You shall have received on the Closing Date an opinion of Venture
Law Group, special counsel to the Company, dated the Closing Date, to the effect
set forth in Exhibit I.
The opinions of Xxxxxxx Coie, Xxxxxxxxxx Xxxxx, Xxxxx & XxXxxxxx,
Bufete Xxxxx y Xxxxxxx, S.C., Xxxxx, Xxxxxxxx Xxxxxx y Xxxxxxxx Xxx, S.C.,
Pudong Law Office, Xxxxxxxx Xxxxx Xxx Xxxxxxxxx & San Xxxx, M. & X. Xxxxxxx,
Xxxxxxxx Xxxx, Xxxxxx & Xxxxxx and Venture Law Group shall be rendered to you at
the request of the Company and shall so state therein.
(i) You shall have received on the Closing Date an opinion of
Shearman & Sterling, counsel for the Placement Agents, dated the Closing Date,
in form and substance satisfactory to you.
(j) You shall have received on each of the date hereof and the
Closing Date a letter, dated the date hereof or the Closing Date, as the case
may be, in form and substance satisfactory to you, from Deloitte & Touche LLP,
the Company's independent public accountants, containing statements and
information of the type ordinarily included in accountants' "comfort letters" to
underwriters with respect to the financial statements and certain financial
information contained in the Final Memorandum.
(k) You shall have received on each of the date hereof and the
Closing Date a letter, dated the date hereof, in form and substance satisfactory
to you, from each of KPMG Xxxxxxxx Xxxxx, S.C. Peat Marwick and KPMG Peat
Marwick LLP, the Company's independent public accountants, containing statements
and information of the type ordinarily included in accountants' "comfort
letters" to underwriters with respect to the financial statements and certain
financial information contained in the Final Memorandum.
(l) You shall have received evidence of the contribution by Nextel
Investment Company to the Company of its approximately 38% equity interest in
Corporacion MobilCom S.A. de C.V. and approximately 3.7% equity interest in
Clearnet Communications, Inc., as described in the Final Memorandum.
(m) You shall have received executed copies of the Tax Sharing
Agreement, the Overhead Services Agreement and the Right of First Opportunity
Agreement, each between the Company and Nextel Communications, Inc., and the
side letter between Motorola, Inc. and the Company; and each such agreement
shall be in full force and effect on the Closing Date.
(n) You shall have received such other certificates and documents as
you or your counsel may reasonably request.
5. Covenants of the Company. In further consideration of the
agreements of the Placement Agents contained in this Agreement, the Company
covenants as follows:
(a) To furnish to you, without charge, during the period
mentioned in paragraph (c) of this Section 5, as many copies of the Final
Memorandum and any supplements and amendments thereto as you may reasonably
request and to use its reasonable best efforts to deliver such copies to you by
10:00 a.m. (New York time) on the business day next following the execution of
this Agreement.
(b) Before amending or supplementing either Memorandum, to furnish to
you a copy of each such proposed amendment or supplement and not to use any such
proposed amendment or supplement to which you reasonably object.
(c) If, during such period after the date hereof and prior to the date
on which all of the Units shall have been sold by the Placement Agents, any
event shall occur or condition exist as a result of which it is necessary in
your judgment to amend or supplement the Final Memorandum in order to make the
statements therein, in the light of the circumstances when such Memorandum is
delivered to a purchaser, not misleading, or if, in the opinion of counsel to
the Placement Agents, it is necessary to amend or supplement such Memorandum to
comply with applicable law, forthwith to prepare and furnish, at its own
expense, to the Placement Agents, either amendments or supplements to such
Memorandum so that the statements in such Memorandum as so amended or
supplemented will not, in the light of the circumstances when such Memorandum is
delivered to a purchaser, be misleading or so that such Memorandum, as so
amended or supplemented, will comply in all material respects with applicable
law.
(d) To endeavor to qualify the Units, the Notes and the Warrants for
offer and sale under the securities or Blue Sky laws of such jurisdictions as
you shall reasonably request; provided that in no event shall the Company be
obligated to qualify to do business in any jurisdiction where it is not now so
qualified or to take any action which would subject it to service or process in
suits, other than those arising out of the offering or sale of the Units, Notes
and Warrants, in any jurisdiction where it is not now so subject.
(e) Whether or not any sale of such Units is consummated, to pay all
expenses incident to the performance of its obligations under this Agreement,
including: (i) the preparation of each Memorandum and all amendments and
supplements thereto, (ii) the preparation, issuance and delivery of the Units,
(iii) the fees and disbursements of the Company's counsel and accountants and
the Trustee and the Warrant Agent and their respective counsel, (iv) the
qualification of such Units, Notes and Warrants under securities or Blue Sky
laws in accordance with the provisions of Section 5(d), including filing fees
and the fees and disbursements of counsel for the Placement Agents in connection
therewith and in connection with the preparation of any Blue Sky or legal
investment memoranda, (v) the printing and delivery to the Placement Agents in
quantities as hereinabove stated of copies of the Memorandum and any amendments
or supplements thereto, (vi) any fees charged by rating agencies for the rating
of such Notes, (vii) all document production charges and expenses of counsel to
the Placement Agents (but not including their fees for professional services) in
connection with the preparation of this Agreement, (viii) the fees and expenses,
if any, incurred in connection with the admission of such Units, Notes or
Warrants for trading in PORTAL or any other appropriate market system, (ix) the
costs and expenses of the Company relating to investor presentations on any
"road show" undertaken in connection with the marketing of the Units, including,
without limitation, expenses associated with the production of road show slides
and graphics, fees and expenses of any consultants engaged in connection with
the road show presentations with the prior approval of the Company, travel and
lodging expense of the representatives and officers of the Company and any such
consultants, and the cost of any aircraft chartered in connection with the road
show, and (x) all other costs and expenses incident to the performance of the
obligations of the Company hereunder for which provision is not otherwise made
in this Section.
(f) Neither the Company nor any Affiliate will sell, offer for sale
or solicit offers to buy or otherwise negotiate in respect of any security (as
defined in the Securities Act) which could be integrated with the sale of the
Units, the Notes or the Warrants in a manner which would require the
registration under the Securities Act of such Units, Notes or Warrants.
(g) Not to solicit any offer to buy or offer or sell the Units, the
Notes or the Warrants by means of any form of general solicitation or general
advertising (as those terms are used in Regulation D under the Securities Act)
or in any manner involving a public offering within the meaning of Section 4(2)
of the Securities Act except as contemplated by the Registration Rights
Agreement or Warrant Registration Rights Agreement.
(h) While any of the Units, the Notes or the Warrants remain
outstanding, to make available, upon request, to any seller of such Units, Notes
or Warrants the information specified in Rule 144A(d)(4) under the Securities
Act, unless the Company is then subject to Section 13 or 15(d) of the Securities
Exchange Act of 1934 (the "Exchange Act").
(i) Except as contemplated by the Registration Rights Agreement
or Warrant Registration Rights Agreement, none of the Company, its Affiliates or
any person acting on its or their behalf (other than the Placement Agents) will
engage in any directed selling efforts (as that term is defined in Regulation S)
with respect to the Units, the Notes or the Warrants and the Company and its
Affiliates and each person acting on its or their behalf (other than the
Placement Agents) will comply with the offering restrictions of Regulation S.
(j) The Company will, and will cause the Warrant Agent with
respect to the Warrants and the registrar for the Warrant Shares to, refuse to
register any transfer of Warrants or Warrant Shares sold pursuant to Regulation
S if such transfer is not made in accordance with the provisions of Regulation
S.
(k) The Company will, and will cause the Trustee to, refuse to
register any transfer of the Notes sold pursuant to Regulation S if such
transfer is not made in accordance with the provisions of Regulation S and the
Indenture.
(l) To use its best efforts to permit the Units, the Notes and the
Warrants to be designated PORTAL securities in accordance with the rules and
regulations adopted by the National Association of Securities Dealers, Inc.
relating to trading in the PORTAL Market.
(m) To use the net proceeds received by it from the sale of the Units
pursuant to this Agreement substantially in the manner specified and to the
extent set forth in the Final Memorandum under the caption "Use of Proceeds."
6. Offering of Securities; Restrictions on Transfer. (a) Each
Placement Agent, severally and not jointly, represents and warrants that such
Placement Agent is a qualified institutional buyer as defined in Rule 144A under
the Securities Act (a "QIB"). Each Placement Agent, severally and not jointly,
agrees with the Company that (i) it will not solicit offers for, or offer or
sell, such Units, Notes or Warrants by any form of general solicitation or
general advertising (as those terms are used in Regulation D under the
Securities Act) or in any manner involving a public offering within the meaning
of Section 4(2) of the Securities Act and (ii) it will solicit offers for such
Units, Notes or Warrants only from, and will offer such Units, Notes or Warrants
only to, persons that it reasonably believes to be (A) in the case of offers
inside the United States, (x) QIBs or (y) other institutional accredited
investors (as defined in Rule 501(a) (1), (2), (3) or (7) under the Securities
Act) ("institutional accredited investors") that, prior to their purchase of the
Units, deliver to such Placement Agent a letter containing the representations
and agreements set forth in Annex A to the Memorandum and (B) in the case of
offers outside the United States, to persons other than U.S. persons ("foreign
purchasers," which term shall include dealers or other professional fiduciaries
in the United States acting on a discretionary basis for foreign beneficial
owners (other than an estate or trust)) that, in each case, in purchasing such
Units are deemed to have represented and agreed as provided in the Final
Memorandum under the caption "Transfer Restrictions."
(b) Each Placement Agent, severally and not jointly, represents,
warrants, and agrees with respect to offers and sales outside the United States
that:
(i) it understands that no action has been or will be taken in any
jurisdiction by the Company that would permit a public offering of the Units,
the Notes or the Warrants, or possession or distribution of either Memorandum or
any other offering or publicity material relating to the Units, the Notes or the
Warrants, in any country or jurisdiction where action for that purpose is
required;
(ii) such Placement Agent will comply with all applicable laws and
regulations in each jurisdiction in which it acquires, offers, sells or delivers
Units, Notes or Warrants or has in its possession or distributes either
Memorandum or any such other material, in all cases at its own expense;
(iii) the Units, the Notes and the Warrants have not been and
will not be registered under the Securities Act and may not be offered or sold
within the United States or to, or for the account or benefit of, U.S. persons
except in accordance with Regulation S under the Securities Act or pursuant to
an exemption from the registration requirements of the Securities Act;
(iv) such Placement Agent has offered the Units, the Notes or the
Warrants and will offer and sell the Units, the Notes or the Warrants (A) as
part of its distribution at any time and (B) otherwise until 40 days after the
Closing Date with respect to the Notes, and one year after the Closing Date with
respect to the Units and the Warrants, only in accordance with Rule 903 of
Regulation S or another exemption from the registration requirements of the
Securities Act. Accordingly, neither such Placement Agent, its Affiliates nor
any persons acting on its or their behalf have engaged or will engage in any
directed selling efforts (within the meaning of Regulation S) with respect to
the Units, the Notes or the Warrants, and any such Placement Agent, its
Affiliates and any such persons have complied and will comply with the offering
restrictions requirements of Regulation S;
(v) such Placement Agent has (A) not offered or sold and, during the
period of six months from the date hereof, will not offer or sell any Units,
Notes or Warrants to persons in the United Kingdom except to persons whose
ordinary activities involve them in acquiring, holding, managing or disposing of
investments (as principal or agent) for the purposes of their businesses or
otherwise in circumstances which have not resulted and will not result in an
offer to the public in the United Kingdom within the meaning of the Public
Offers of Securities Regulations 1995 (the "Regulations"); (B) complied and,
during the period of six months from the date hereof, will comply with all
applicable provisions of the Financial Services Xxx 0000 and the Regulations
with respect to anything done by it in relation to the Units, the Notes or the
Warrants in, from or otherwise involving the United Kingdom; and (C) only issued
or passed on and, during the period of six months from the date hereof, will
only issue or pass on to any person in the United Kingdom any document received
by it in connection with the issue of the Units, the Notes or the Warrants if
that person is of a kind described in Article 11(3) of the Financial Services
Xxx 0000 (Investment Advertisements) (Exemptions) Order 1996 or is a person to
whom such document may otherwise lawfully be issued or passed on;
(vi) such Placement Agent understands that the Units, the Notes and the
Warrants have not been and will not be registered under the Securities and
Exchange Law of Japan, and represents that it has not offered or sold, and
agrees that it will not offer or sell, any Units, Notes or Warrants, directly or
indirectly in Japan or to any resident of Japan except (A) pursuant to an
exemption from the registration requirements of the Securities and Exchange Law
of Japan and (B) in compliance with any other applicable requirements of
Japanese law; and
(vii) such Placement Agent agrees that, at or prior to confirmation of
sales of the Units, it will have sent to each distributor, dealer or person
receiving a selling concession, fee or other remuneration that purchases Units,
Notes or Warrants from it during the restricted period a confirmation or notice
to substantially the following effect:
"The Units, Notes or Warrants covered hereby have not
been registered under the U.S. Securities Act of 1933 (the
"Securities Act") and may not be offered and sold within the
United States or to, or for the account or benefit of, U.S.
persons (i) as part of their distribution at any time or (ii)
otherwise until 40 days after the closing date with respect to
the Notes and 1 year after the closing date with respect to the
Units and the Warrants, except in either case in accordance
with Regulation S (or Rule 144A, if available) under the
Securities Act. Terms used above have the meaning given to them
by Regulation S."
Terms used in this Section 6 have the meanings given to them
by Regulation S.
7. Indemnification and Contribution. (a) The Company agrees to
indemnify and hold harmless each Placement Agent, and each person, if any, who
controls such Placement Agent within the meaning of either Section 15 of the
Securities Act or Section 20 of the Exchange Act, or is under common control
with, or is controlled by, such Placement Agent, from and against any and all
losses, claims, damages and liabilities (including, without limitation, any
legal or other expenses reasonably incurred by any Placement Agent or any such
controlling of affiliated person in connection with defending or investigating
any such action or claim) caused by any untrue statement or alleged untrue
statement of a material fact contained in either Memorandum (as amended or
supplemented if the Company shall have furnished any amendments or supplements
thereto), or caused by any omission or alleged omission to state therein a
material fact necessary to make the statements therein in light of the
circumstances under which they were made not misleading, except insofar as such
losses, claims, damages or liabilities are caused by any such untrue statement
or omission or alleged untrue statement or omission based upon information
relating to any Placement Agent furnished to the Company in writing by such
Placement Agent through you expressly for use therein.
(b) Each Placement Agent agrees, severally and not jointly, to
indemnify and hold harmless the Company, its directors and officers and each
person, if any, who controls the Company within the meaning of either Section 15
of the Securities Act or Section 20 of the Exchange Act to the same extent as
the foregoing indemnity from the Company to such Placement Agent, but only with
reference to information relating to such Placement Agent furnished to the
Company in writing by such Placement Agent through you expressly for use in
either Memorandum or any amendments or supplements thereto.
(c) In case any proceeding (including any governmental investigation)
shall be instituted involving any person in respect of which indemnity may be
sought pursuant to either paragraph (a) or (b) of this Section 7, such person
(the "indemnified party") shall promptly notify the person against whom such
indemnity may be sought (the "indemnifying party") in writing and the
indemnifying party, upon request of the indemnified party, shall retain counsel
reasonably satisfactory to the indemnified party to represent the indemnified
party and any others the indemnifying party may designate in such proceeding and
shall pay the reasonable fees and disbursements of such counsel related to such
proceeding. In any such proceeding, any indemnified party shall have the right
to retain its own counsel, but the fees and expenses of such counsel shall be at
the expense of such indemnified party unless (i) the indemnifying party and the
indemnified party shall have mutually agreed to the retention of such counsel or
(ii) the named parties to any such proceeding (including any impleaded parties)
include both the indemnifying party and the indemnified party and representation
of both parties by the same counsel would be inappropriate due to actual or
potential differing interests between them. It is understood that the
indemnifying party shall not, in connection with any proceeding or related
proceedings in the same jurisdiction, be liable for the reasonable fees and
expenses of more than one separate firm (in addition to any local counsel) for
all such indemnified parties and that all such fees and expenses shall be
reimbursed as they are incurred. Such firm shall be designated in writing by
Xxxxxx Xxxxxxx & Co. Incorporated in the case of parties indemnified pursuant to
paragraph (a) of this Section 7 and by the Company in the case of parties
indemnified pursuant to paragraph (b) of this Section 7. The indemnifying party
shall not be liable for any settlement of any proceeding effected without its
written consent, but if settled with such consent or if there be a final
judgment for the plaintiff, the indemnifying party agrees to indemnify the
indemnified party from and against any loss or liability by reason of such
settlement or judgment. Notwithstanding the foregoing sentence, if at any time
an indemnified party shall have requested an indemnifying party to reimburse the
indemnified party for fees and expenses of counsel as contemplated by the second
and third sentences of this paragraph, the indemnifying party agrees that it
shall be liable for any settlement of any proceeding effected without its
written consent if (i) such settlement is entered into more than 45 days after
receipt by such indemnifying party of the aforesaid request and (ii) such
indemnifying party shall not have reimbursed the indemnified party in accordance
with such request prior to the date of such settlement. No indemnifying party
shall, without the prior written consent of the indemnified party, effect any
settlement of any pending or threatened proceeding in respect of which any
indemnified party is or could have been a party and indemnity could have been
sought hereunder by such indemnified party, unless such settlement includes an
unconditional release of such indemnified party from all liability on claims
that are the subject matter of such proceeding.
(d) To the extent the indemnification provided for in paragraph (a)
or (b) of this Section 7 is unavailable to an indemnified party or insufficient
in respect of any losses, claims, damages or liabilities, then each indemnifying
party under such paragraph, in lieu of indemnifying such indemnified party
thereunder, shall contribute to the amount paid or payable by such indemnified
party as a result of such losses, claims, damages or liabilities (i) in such
proportion as is appropriate to reflect the relative benefits received by the
Company, on the one hand, and the Placement Agents, on the other hand, from the
offering of such Units or (ii) if the allocation provided by clause (i) above is
not permitted by applicable law, in such proportion as is appropriate to reflect
not only the relative benefits referred to in clause (i) above but also the
relative fault of the Company on the one hand and the Placement Agents on the
other hand in connection with the statements or omissions that resulted in such
losses, claims, damages or liabilities, as well as any other relevant equitable
considerations. The relative benefits received by the Company on the one hand
and the Placement Agents on the other hand in connection with the offering of
such Units shall be deemed to be in the same respective proportions as the net
proceeds from the offering of such Units (before deducting expenses) received by
the Company and the total discounts and commissions received by the Placement
Agents in respect thereof bear to the aggregate offering price of such Units.
The relative fault of the Company on the one hand and of the Placement Agents on
the other hand shall be determined by reference to, among other things, whether
the untrue or alleged untrue statement of a material fact or the omission or
alleged omission to state a material fact relates to information supplied by the
Company or by the Placement Agents and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such statement or
omission. The Placement Agents' respective obligations to contribute pursuant to
this Section 7 are several in proportion to the respective number of Units they
have purchased hereunder, and not joint.
(e) The Company and the Placement Agents agree that it would not
be just or equitable if contribution pursuant to this Section 7 were determined
by pro rata allocation (even if the Placement Agents were treated as one entity
for such purpose) or by any other method of allocation that does not take
account of the equitable considerations referred to in paragraph (d) above. The
amount paid or payable by an indemnified party as a result of the losses,
claims, damages and liabilities referred to in paragraph (d) above shall be
deemed to include, subject to the limitations set forth above, any legal or
other expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding the
provisions of this Section 7, no Placement Agent shall be required to contribute
any amount in excess of the amount by which the total price at which the Units
resold by it in the initial placement of such Units were offered to investors
exceeds the amount of any damages that such Placement Agent has otherwise been
required to pay by reason of such untrue or alleged untrue statement or omission
or alleged omission. No person guilty of fraudulent misrepresentation (within
the meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. The indemnity and contribution provisions contained in this
Section 7 and the representations and warranties of the Company contained in
this Agreement shall remain operative and in full force and effect regardless of
(i) any termination of this Agreement, (ii) any investigation made by or on
behalf of the Placement Agents or any person controlling the Placement Agents or
by or on behalf of the Company, its officers or directors or any person
controlling the Company and (iii) acceptance of and payment for any of the
Units. The remedies provided for in this Section 7 are not exclusive and shall
not limit any rights or remedies which may otherwise be available to any
indemnified party at law or in equity.
8. Termination. This Agreement shall be subject to termination by
notice given by you to the Company, if (a) after the execution and delivery of
this Agreement and prior to the Closing Date (i) trading generally shall have
been suspended or materially limited on or by, as the case may be, any of the
New York Stock Exchange, the American Stock Exchange, the National Association
of Securities Dealers, Inc., the Chicago Board of Options Exchange, the Chicago
Mercantile Exchange or the Chicago Board of Trade, (ii) trading of any
securities of the Company shall have been suspended on any exchange or in any
over-the-counter market, (iii) a general moratorium on commercial banking
activities in New York shall have been declared by either Federal or New York
State authorities or (iv) there shall have occurred any outbreak or escalation
of hostilities or any change in financial markets or any calamity or crisis
that, in your judgment, is material and adverse and (b) in the case of any of
the events specified in clauses (a)(i) through (iv), such event singly or
together with any other such event makes it, in your judgment, impracticable to
market the Units on the terms and in the manner contemplated in the Final
Memorandum.
9. Miscellaneous. If, on the Closing Date, any one or more of the
Placement Agents shall fail or refuse to purchase Units that it or they have
agreed to purchase hereunder on such date, and the number of Units which such
defaulting Placement Agent or Placement Agents agreed but failed or refused to
purchase is not more than one-tenth of the aggregate number of Units to be
purchased on such date, the other Placement Agents shall be obligated severally
in the proportions that the number of Units set forth opposite their respective
names in Schedule I bears to the aggregate number of Units set forth opposite
the names of all such non-defaulting Placement Agents, or in such other
proportions as you may specify, to purchase the Units which such defaulting
Placement Agent or Placement Agents agreed but failed or refused to purchase on
such date; provided that in no event shall the number of Units that any
Placement Agent has agreed to purchase pursuant to Section 3 be increased
pursuant to this Section 9 by a number in excess of one-ninth of such number of
Units without the written consent of such Placement Agent. If, on the Closing
Date any Placement Agent or Placement Agents shall fail or refuse to purchase
Units which it or they have agreed to purchase hereunder on such date and the
aggregate number of Units with respect to which such default occurs is more than
one-tenth of the aggregate number of Units to be purchased on such date and
arrangements satisfactory to you and the Company for the purchase of such Units
are not made within 36 hours after such default, this Agreement shall terminate
without liability on the part of any non-defaulting Placement Agent or of the
Company. In any such case either you or the Company shall have the right to
postpone the Closing Date, but in no event for longer than seven days, in order
that the required changes, if any, in the Final Memorandum or in any other
documents or arrangements may be effected. Any action taken under this paragraph
shall not relieve any defaulting Placement Agent from liability in respect of
any default of such Placement Agent under this Agreement.
This Agreement may be signed in any number of counterparts, each of
which shall be an original, with the same effect as if the signatures thereto
and hereto were upon the same instrument.
If this Agreement shall be terminated by the Placement Agents, or any
of them, because of any failure or refusal on the part of the Company to comply
with the terms or to fulfill any of the conditions of this Agreement, or if for
any reason the Company shall be unable to perform its obligations under this
Agreement, the Company will reimburse the Placement Agents or such Placement
Agents as have so terminated this Agreement with respect to themselves,
severally, for all out-of-pocket expenses (including the reasonable fees and
disbursements of their counsel) reasonably incurred by such Placement Agents in
connection with this Agreement or the offering contemplated hereunder.
THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE INTERNAL LAWS OF THE STATE OF NEW YORK.
The headings of the sections of this Agreement have been inserted for
convenience of reference only and shall not be deemed a part of this Agreement.
Please confirm your agreement to the foregoing by signing in the space
provided below for that purpose and returning to us a copy hereof, whereupon
this Agreement shall constitute a binding agreement between us.
Very truly yours,
XxXXX INTERNATIONAL, LTD.
By: /s/ Xxxxx X. Xxxxxxxxx
-----------------------
Name:
Title: President & CEO
Agreed, as of the date first above written
Xxxxxx Xxxxxxx & Co.
Incorporated
Acting severally on behalf
of itself and the several
Placement Agents named herein.
By Xxxxxx Xxxxxxx & Co. Incorporated
By: /s/ Xxxxxxxx X. Xxxxxxxx
--------------------------
Name:
Title: Principal
SCHEDULE I
Number of Units
Placement Agent To Be Purchased
--------------- ---------------
Xxxxxx Xxxxxxx & Co. Incorporated 594,664
Chase Securities Inc. 166,506
Xxxxxx Brothers Inc. 166,506
NatWest Capital Markets Limited 23,787
-------
Total........................................ 951,463
=======
SCHEDULE II
List of Subsidiaries
XxXxx International (Services), Ltd. (Delaware) 100%
XxXxx International (Can Mex) (Delaware) 100%
Shanghai XxXxx Telecommunications System Co., Ltd. (PRC) 60%
Wireless Ventures of Brazil, Inc. (Virginia) 81%
XxXxx International (Holdings) Ltd. (Cayman Islands) 100%
XxXxx International (Philippines) LLC (Cayman Islands) 99%
TOP Mega Enterprises Ltd. (Hong Kong) 100%
Infocom Communications Network, Inc. (Philippines) 30%
XxXxx International (Argentina) LLC (Cayman Islands) 99%
XxXxx Argentina S.A. (Argentina) 99%
Corporacion Mobilcom S.A. de C.V. (Mexico) 38%
EXHIBIT A
---------
Form of Warrant Agreement
EXHIBIT B
---------
Form of Registration
Rights Agreement
EXHIBIT C
---------
Form of Warrant
Registration Rights Agreement
EXHIBIT D
---------
Opinion of Counsel for the Company
The opinion of Xxxxxxx Coie, counsel for the Company, to be delivered
pursuant to Section 4(c) of the Placement Agreement shall be to the effect that:
(A) the Company has been duly incorporated, is validly existing as a
corporation in good standing under the laws of the jurisdiction of its
incorporation, has the power and authority to own its property and to conduct
its business as described in the Final Memorandum (references herein to the
Final Memorandum being taken to mean the same, as amended or supplemented), and
is duly qualified to transact business and is in good standing in each
jurisdiction in which the conduct of its business or its ownership or leasing of
property requires such qualification, except to the extent that the failure to
be so qualified or be in good standing would not have a material adverse effect
on the Company and the Subsidiaries taken as a whole;
(B) each United States Subsidiary of the Company has been duly
incorporated, is validly existing as a corporation in good standing under the
laws of the jurisdiction of its incorporation (or in the case of each Subsidiary
that is a partnership, is duly formed and validly existing as a partnership in
good standing under the laws of the jurisdiction of its organization), has the
corporate power and authority to own its property and to conduct its business as
described in the Final Memorandum and is duly qualified to transact business and
is in good standing in each jurisdiction in which the conduct of its business or
its ownership or leasing of property requires such qualification, except to the
extent that the failure to be so qualified or be in good standing would not have
a material adverse effect on the Company and the Subsidiaries, taken as a whole;
(C) the execution and delivery by the Company of, and the
performance by the Company of its obligations under, the Placement Agreement,
the Indenture, the Registration Rights Agreement, the Warrant Agreement, the
Warrant Registration Rights Agreement and the execution, issuance, sale and
delivery of the Notes and the Warrants and the issuance of the Warrant Shares
upon exercise of the Warrants in accordance with the Warrants and the Warrant
Agreement by the Company will not contravene (i) any provision of applicable
law, (ii) the certificate of incorporation or by-laws of the Company, (iii) to
such counsel's knowledge, any agreement or other instrument binding upon the
Company or any of the Subsidiaries that is material to the Company and the
Subsidiaries, taken as a whole, or (iv) to such counsel's knowledge, any
judgment, order or decree of any governmental body, agency or court having
jurisdiction over the Company or any Subsidiary, and no permit, license,
consent, approval, authorization or order of, or filing, declaration or
qualification with, any governmental body or agency is required for the
performance by the Company or the Subsidiaries of their obligations under the
Placement Agreement, the Indenture, the Registration Rights Agreement, the
Warrant Agreement, the Warrant Registration Rights Agreement, the Notes, the
Warrants or the Warrant Shares, except such as may be required by the securities
or Blue Sky laws of the various states in connection with the offer and sale of
the Units, the Notes and the Warrants;
(D) after due inquiry, such counsel does not know of any legal or
governmental proceedings pending or threatened to which the Company or any of
the Subsidiaries is a party or to which any of the properties of the Company or
any of the Subsidiaries is subject other than proceedings fairly summarized in
all material respects in the Final Memorandum and proceedings which such counsel
believes are not likely to have a material adverse effect on the Company and the
Subsidiaries, taken as a whole, or on the power or ability of the Company to
perform its obligations under the Placement Agreement, the Indenture, the
Registration Rights Agreement, the Warrant Agreement, the Warrant Registration
Rights Agreement, the Notes, the Warrants or the Warrant Shares or to consummate
the transactions contemplated by the Final Memorandum;
(E) the Company is not, and after giving effect to the offering and
sale of the Units, Notes and Warrants and the application of the proceeds
thereof as described in the Final Memorandum, will not be an "investment
company," as such term is defined in the Investment Company Act of 1940, as
amended;
(F) the Company is not a "public utility holding company" as
such term is defined in the Public Utility Holding Company Act of 1935, as
amended;
(G) the statements in the Final Memorandum under the caption
"Certain United States Federal Income Tax Considerations" are accurate in all
material respects and fairly summarize the matters referred to therein;
(H) the Warrant Shares have been duly authorized and reserved by
the Company and, when issued and delivered upon exercise of the Warrants in
accordance with the terms of the Warrants, will be validly issued, fully paid
and non-assessable and will not be subject to any preemptive or similar rights;
and
(I) each of the Placement Agreement, the Notes, the Indenture, the
Registration Rights Agreement, the Warrants, the Warrant Agreement and the
Warrant Registration Rights Agreement has been duly authorized, executed and
delivered by the Company.
EXHIBIT E
---------
Opinion of Special Counsel for the Company
The opinion of Xxxxxxxxxx Xxxxx, special counsel for the Company, to be
delivered pursuant to Section 4(d) of the Placement Agreement shall be to the
effect that:
(A) the Placement Agreement has been duly authorized, executed and
delivered by the Company;
(B) the Notes have been duly authorized and executed by the Company
and, when authenticated and delivered to and paid for in accordance with the
terms of the Placement Agreement, will (x) be valid and binding obligations of
the Company enforceable in accordance with their terms, except as (i) the
enforceability thereof may be limited by bankruptcy, insolvency or similar laws
now or hereafter in effect relating to or affecting creditors' rights generally
and (ii) rights of acceleration, if applicable, and the availability of
equitable remedies may be limited by equitable principles and (y) be entitled to
the benefits of the Indenture and the Registration Rights Agreement;
(C) the Indenture has been duly authorized, executed and delivered by,
and is a valid and binding agreement of, the Company, enforceable in accordance
with its terms, except as (x) the enforceability thereof may be limited by
bankruptcy, insolvency or similar laws now or hereafter in effect relating to or
affecting creditors' rights generally, (y) rights of acceleration, if
applicable, and the availability of equitable remedies may be limited by
equitable principles and (z) rights to indemnification and contribution may be
limited by public policy;
(D) the Registration Rights Agreement has been duly authorized,
executed and delivered by, and is a valid and binding agreement of, the Company,
enforceable in accordance with its terms, except as (x) the enforceability
thereof may be limited by bankruptcy, insolvency or similar laws now or
hereafter in effect relating to or affecting creditors' rights generally, (y)
rights of acceleration, if applicable, and the availability of equitable
remedies may be limited by equitable principles and (z) rights to
indemnification and contribution may be limited by public policy;
(E) the Warrants have been duly authorized and executed by the
Company, and when countersigned by the Warrant Agent as provided in the Warrant
Agreement, and delivered to and paid for by the Placement Agents in accordance
with the terms of the Placement Agreement, will (x) be valid and binding
obligations of the Company enforceable in accordance with their terms, except as
(A) the enforceability thereof may be limited by bankruptcy, insolvency or
similar laws now or hereafter in effect relating to or affecting creditors'
rights generally and (B) rights of acceleration, if applicable, and the
availability of equitable remedies may be limited by equitable principles and
(y) be entitled to the benefits of the Warrant Agreement and the Warrant
Registration Rights Agreement;
(F) the Warrant Agreement has been duly authorized, executed and
delivered by, and is a valid and binding agreement of, the Company, enforceable
in accordance with its terms except as (x) the enforceability thereof may be
limited by bankruptcy, insolvency or similar laws now or hereafter in effect
relating to or affecting creditors' rights generally, (y) rights of
acceleration, if applicable, and the availability of equitable remedies may be
limited by equitable principles and (z) rights to indemnification and
contribution may be limited by public policy;
(G) the Warrant Registration Rights Agreement has been duly
authorized, executed and delivered by, and is a valid and binding agreement of,
the Company, enforceable in accordance with its terms, except as (x) the
enforceability thereof may be limited by bankruptcy, insolvency or similar laws
now or hereafter in effect relating to or affecting creditors' rights generally,
(y) rights of acceleration, if applicable, and the availability of equitable
remedies may be limited by equitable principles and (z) rights to
indemnification and contribution may be limited by public policy;
(H) the Warrant Shares have been duly authorized and reserved by the
Company and, when issued and delivered upon exercise of the Warrants in
accordance with the terms of the Warrants, will be validly issued, fully paid
and non-assessable and will not be subject to any preemptive rights;
(I) the statements in the Final Memorandum under the captions
"Description of the Units," "Description of the Notes," "Description of the
Warrants," "Description of Capital Stock," "Private Placement" and "Transfer
Restrictions," insofar as such statements constitute a summary of the legal
matters or documents referred to therein, fairly summarize in all material
respects the matters referred to therein;
(J) such counsel believes that (except for financial statements as to
which such counsel need not express any belief) the Final Memorandum when issued
did not, and as of the date such opinion is delivered does not, contain any
untrue statement of a material fact or omit to state a material fact necessary
in order to make the statements therein, in the light of the circumstances under
which they were made, not misleading; and
(K) based upon the representations, warranties, and agreements of the
Company in Sections 1(o), 1(u), 5(f), 5(g), 5(i), 5(j) and 5(k) of the Placement
Agreement and of the Placement Agents in Section 6 of the Placement Agreement,
it is not necessary in connection with the offer, sale and delivery of the
Units, Notes and Warrants to the Placement Agents under the Placement Agreement
or in connection with the initial resale of such Units, Notes or Warrants by the
Placement Agents in accordance with Section 6 of the Placement Agreement to
register the Units, the Notes or the Warrants under the Securities Act of 1933,
it being understood that no opinion is expressed as to any subsequent resale of
any of the Units, the Notes or the Warrants.
With respect to paragraph (J) above, counsel may state that their
opinion and belief are based upon their participation in the preparation of the
Final Memorandum (and any amendments or supplements thereto) and review and
discussion of the contents thereof, but are without independent check or
verification except with respect to paragraph (I) above.
EXHIBIT F
---------
Opinion of Foreign Counsel for the Company
The opinion of [_____________], foreign counsel for the Company, to be
delivered pursuant to Section 4(f) of the Placement Agreement shall be to the
effect that:
(A) [Name of Operating Company] has been duly incorporated, is validly
existing as a corporation in good standing under the laws of [the jurisdiction
of its organization], has the corporate power and authority to own its property
and to conduct its business as described in the Final Memorandum and is duly
qualified to transact business and is in good standing in each jurisdiction in
which the conduct of its business or its ownership or leasing of property
requires such qualification, except to the extent that the failure to be so
qualified or be in good standing would not have a material adverse effect on the
Company and its subsidiaries taken as a whole;
(B) each Subsidiary of [Name of Operating Company] has been duly
incorporated, is validly existing as a corporation in good standing under the
laws of the jurisdiction of its organization, has the corporate power and
authority to own its property and to conduct its business as described in the
Final Memorandum and is duly qualified to transact business and is in good
standing in each jurisdiction in which the conduct of its business or its
ownership or leasing of property requires such qualification, except to the
extent that the failure to be so qualified or be in good standing would not have
a material adverse effect on the Company and its subsidiaries taken as a whole;
(C) each of [Name of Operating Company] and its subsidiaries (i) has
all necessary licenses, consents, authorizations, approvals, orders,
certificates and permits of and from, and has made all declarations and filings
with, all [name of country] governmental, administrative or regulatory
authorities, all self-regulatory organizations and all courts and other
tribunals, to own, lease, license and use its properties and assets and to
conduct its business in the manner described in or contemplated by each
Memorandum, including providing digital enhanced specialized mobile radio
services, except to the extent that the failure to obtain such consents,
authorizations, approvals, orders, certificates and permits or make such
declarations and filings would not have a material adverse effect on [Name of
Operating Company] and its subsidiaries, taken as a whole and (ii) has not
received any notice of proceedings relating to the violation, revocation or
modification of any such license, consent, authorization, approval, order,
certificate or permit which, singly or in the aggregate, if the subject of an
unfavorable decision, ruling or finding, would reasonably be expected to result
in a material adverse change in the condition, financial or otherwise, or in the
earnings, business or operations of [Name of Operating Company] and its
subsidiaries, taken as a whole, except as described in each Memorandum;
(D) the statements in the Final Memorandum under the captions ["Risk
Factors - Government Regulation", "Business - [Name of Country] - Regulatory and
Legal Overview" and other Sections to be designated], in each case insofar as
such statements constitute summaries of the [name of country] legal matters,
documents or proceedings referred to therein, are accurate in all material
respects and fairly summarize all matters referred to therein, and there are no
material omissions under such captions with respect to the description of
statutes, rules or regulations that would make the statements therein
misleading; and
(E) there are no restrictions (legal, contractual or otherwise) on the
ability of [Name of Operating Company] to declare and pay any dividends or make
any payment or transfer of property or assets to its stockholders other than
those described in the Final Memorandum and such restrictions as would not have
a material adverse effect on the prospects, condition, financial or otherwise,
or in the earnings, business or operations of the Company and its subsidiaries,
taken as a whole; and such descriptions, if any, fairly summarize such
restrictions.
EXHIBIT G
---------
Opinion of Cayman Islands Counsel for the Company
The opinion of Cayman Islands counsel for the Company, to be delivered
pursuant to Section 4(g) of the Placement Agreement shall be to the effect that:
(A) [Name of Operating Company] has been duly incorporated, is validly
existing as a corporation in good standing under the laws of [the jurisdiction
of its organization], has the corporate power and authority to own its property
and to conduct its business as described in the Final Memorandum and is duly
qualified to transact business and is in good standing in each jurisdiction in
which the conduct of its business or its ownership or leasing of property
requires such qualification, except to the extent that the failure to be so
qualified or be in good standing would not have a material adverse effect on the
Company and its subsidiaries taken as a whole;
(B) each subsidiary of [Name of Operating Company] has been duly
incorporated, is validly existing as a corporation in good standing under the
laws of the jurisdiction of its organization, has the corporate power and
authority to own its property and to conduct its business as described in the
Final Memorandum and is duly qualified to transact business and is in good
standing in each jurisdiction in which the conduct of its business or its
ownership or leasing of property requires such qualification, except to the
extent that the failure to be so qualified or be in good standing would not have
a material adverse effect on the Company and its subsidiaries taken as a whole;
(C) each of [Name of Operating Company] and its subsidiaries has all
necessary certificates, orders, permits, licenses, authorizations, consents and
approvals of and from, and has made all declarations and filings with, all [name
of country] governmental authorities, all self-regulatory organizations and all
courts and tribunals, to own, lease, license and use its properties and assets
and to conduct its business in the manner described in the Final Memorandum, and
neither [Name of Operating Company] nor any of its subsidiaries has received any
notice of proceedings relating to revocation or modification of any such
certificates, orders, permits, licenses, authorizations, consents or approvals,
nor is [Name of Operating Company] or any of its subsidiaries in violation of,
or in default under, any national or regional law, regulation, rule, decree,
order or judgment applicable to [Name of Operating Company] or any of its
subsidiaries the effect of which, singly or in the aggregate, would have a
material adverse effect on the prospects, condition, financial or otherwise, or
in the earnings, business or operations of the Company and its subsidiaries,
taken as a whole, except as described in the Final Memorandum; and
(D) there are no restrictions (legal, contractual or otherwise) on the
ability of [Name of Operating Company] to declare and pay any dividends or make
any payment or transfer of property or assets to its stockholders other than
those described in the Final Memorandum and such restrictions as would not have
a material adverse effect on the prospects, condition, financial or otherwise,
or in the earnings, business or operations of the Company and its subsidiaries,
taken as a whole; and such descriptions, if any, fairly summarize such
restrictions.
EXHIBIT H
---------
Opinion of China Counsel for the Company
The opinion of China counsel for the Company, to be delivered pursuant
to Section 4(h) of the Placement Agreement shall be to the effect that:
(A) Shanghai XxXxx Telecommunications Co. Ltd. has been duly
incorporated, is validly existing as a corporation in good standing under the
laws of the Peoples Republic of China, has the corporate power and authority to
own its property and to conduct its business as described in the Final
Memorandum and is duly qualified to transact business and is in good standing in
each jurisdiction in which the conduct of its business or its ownership or
leasing of property requires such qualification, except to the extent that the
failure to be so qualified or be in good standing would not have a material
adverse effect on the Company and its subsidiaries taken as a whole;
(B) the statements in the Final Memorandum under the captions ["Risk
Factors - Government Regulation", "Business - China - Regulatory and Legal
Overview", "Corporate Governance - China" and other Sections to be designated],
in each case insofar as such statements constitute summaries of the [name of
country] legal matters, documents or proceedings referred to therein, are
accurate in all material respects and fairly summarize all matters referred to
therein, and there are no material omissions under such captions with respect to
the description of contracts, statutes, rules or regulations that would make the
statements therein misleading; and
(C) there are no restrictions (legal, contractual or otherwise) on the
ability of [Name of Operating Company] to declare and pay any dividends or make
any payment or transfer of property or assets to its stockholders other than
those described in the Final Memorandum and such restrictions as would not have
a material adverse effect on the prospects, condition, financial or otherwise,
or in the earnings, business or operations of the Company and its subsidiaries,
taken as a whole; and such descriptions, if any, fairly summarize such
restrictions.
(D) The Joint Venture Contract dated August __, 1995 and the
Investment Delegation Contract dated ____, 1995 (collectively, the "Chinese
Joint Venture Contracts") have been duly authorized and executed by XxXxx
Shanghai Telecommunications Systems, Limited ("XxXxx Shanghai") and are valid
and binding obligations of XxXxx Shanghai enforceable against XxXxx Shanghai in
accordance with their terms and the Chinese Joint Venture Contracts together
with the Shanghai Mobile Telecommunications GSM Project Cooperation Contract
(including the Rules for Financial Affairs) dated February 25, 1995, entitle
XxXxx Shanghai to receive 42% of the net revenues of the Shanghai GSM Project as
described in the Final Memorandum.
EXHIBIT I
---------
The opinion of Venture Law Group to be delivered pursuant to Section
4(i) of the Placement Agreement shall be to the effect that:
