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EXHIBIT 10.22
EXECUTION COPY
VELOCOM INC.
FOLLOW-ON SERIES B/B-1 PREFERRED STOCK
PURCHASE AGREEMENT
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TABLE OF CONTENTS
1. Agreement To Sell And Purchase.....................................1
1.1 Authorization of Shares ......................................1
1.2 Sale and Purchase ............................................1
2. Closing, Delivery And Payment......................................1
2.1 Initial Closing ..............................................1
2.2 Subsequent Closings ..........................................2
2.3 Certificates; Payment ........................................2
2.4 Absolute Commitment ..........................................2
3. Consequences Upon Default..........................................3
3.1 Specific Performance .........................................3
3.2 Board Representative(s) ......................................3
3.3 Irrevocable Proxy ............................................3
3.4 Premium ......................................................4
3.5 Liquidated Damages ...........................................4
3.6 Conversion Rights ............................................5
4. Representations And Warranties Of The Company......................5
4.1 Organization and Standing ....................................5
4.2 Capitalization of the Company ................................5
4.3 Authority ....................................................6
4.4 Consents and Approvals .......................................7
4.5 Compliance with Laws .........................................7
4.6 Trademarks, Patents, Trade Names, etc. .......................8
4.7 Actions Pending ..............................................8
4.8 Contracts ....................................................8
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4.9 Investments in United States Real Property Interests ................9
4.10 Unrelated Business Taxable Income ..................................9
4.11 Not a Qualified Small Business .....................................9
4.12 Subsidiaries .......................................................9
4.13 Capitalization of the Company's Subsidiaries .......................9
4.14 Share Ownership ...................................................10
4.15 Financial Statements ..............................................10
4.16 Material Changes ..................................................10
4.17 Title .............................................................11
4.18 Licenses ..........................................................11
4.19 Insurance .........................................................11
4.20 Liabilities .......................................................11
4.21 Taxes .............................................................12
4.22 Collective Bargaining Agreements, Employment Agreements and
Employee Relations ................................................12
4.23 Employee Benefits .................................................12
4.24 Recordkeeping Compliance ..........................................13
4.25 Condition of the Companies; Operation of Business in the Ordinary
Course ............................................................13
4.26 Y2K Compliance ....................................................13
4.27 Broker's Fees .....................................................14
4.28 Foreign Corrupt Practices Act .....................................14
4.29 Offering ..........................................................14
4.30 Spectrum Allocation ...............................................14
5. Representations And Warranties Of The Purchasers.........................14
5.1 Requisite Power and Authority ......................................15
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5.2 Investment Representations .........................................15
5.3 Broker's Fees ......................................................16
6. Conditions Precedent To Purchasers' Obligations..........................16
6.1 Conditions to Initial Closing ......................................16
6.2 Conditions to Subsequent Closings ..................................17
7. Vesper Board Observation Rights..........................................17
8. Use of Proceeds..........................................................17
9. Miscellaneous............................................................17
9.1 Governing Law ......................................................17
9.2 Survival ...........................................................17
9.3 Successors and Assigns .............................................18
9.4 Entire Agreement; Amendment and Waiver .............................18
9.5 Specific Enforcement ...............................................18
9.6 Severability .......................................................18
9.7 Notices ............................................................18
9.8 Counterparts .......................................................19
9.9 Future Financings; Purchaser Obligations ...........................19
9.10 Expense Reimbursement .............................................19
9.11 Regulatory Compliance Matters .....................................19
9.12 Understanding Among the Purchasers ................................19
9.13 Acknowledgment Regarding Xxxxxxxx & Xxxxx .........................20
10. Certain Definitions.....................................................20
EXHIBITS:
Exhibit A Schedule of Purchasers A-1
Exhibit B Form of Second Amended and Restated Certificate of
Incorporation B-1
Exhibit C Capitalization Chart C-1
Exhibit D Form of Third Amended and Restated Investors Agreement D-1
Exhibit E Form of Legal Opinion E-1
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VELOCOM INC.
FOLLOW-ON SERIES B/B-1 PREFERRED
STOCK PURCHASE AGREEMENT
This Follow-On Series B/B-1 Preferred Stock Purchase Agreement (this
"Agreement") is entered into as of December 20, 1999, by and among VELOCOM INC.,
a Delaware corporation (the "Company"), and each of those persons and entities,
severally and not jointly, whose names are set forth on the Schedule of
Purchasers attached hereto as Exhibit A (collectively the "Purchasers" and
individually a "Purchaser").
NOW, THEREFORE, in consideration of the mutual promises hereinafter set
forth, the parties hereto agree as follows:
1. AGREEMENT TO SELL AND PURCHASE
1.1 Authorization of Shares. On or prior to the Initial Closing Date
(as defined in Section 2 below), the Company shall have authorized the sale and
issuance to the Purchasers of the shares (the "Shares") of its Series B
Preferred Stock and Series B-1 Preferred Stock (together, the "Series B/B-1
Preferred Stock") described in Section 2 below having the rights, preferences,
privileges and restrictions set forth in the Second Amended and Restated
Certificate of Incorporation, a copy of which is attached hereto as Exhibit B
(the "Certificate of Incorporation").
1.2 Sale and Purchase. Subject to the terms and conditions hereof, the
Company hereby agrees to issue and sell to each Purchaser and each Purchaser
severally and not jointly agrees to purchase from the Company, the aggregate
number of Shares set forth opposite such Purchaser's name on Exhibit A (the
"Purchaser Share Limit"), at a purchase price of six dollars (US$6.00) per
Share, at the Initial Closing and the Subsequent Closings (as defined in Section
2 below) as more fully set forth on Exhibit A.
2. CLOSING, DELIVERY AND PAYMENT
2.1 Initial Closing. Subject to satisfaction of the conditions to
closing set forth in Section 6.1, the initial closing of the sale and purchase
of the Shares under this Agreement (the "Initial Closing") shall take place at
9:00 a.m. on January 7, 2000, at the offices of Holland & Xxxx LLP, 000
Xxxxxxxxxxx Xxxxxx, Xxxxx 0000, Xxxxxx, XX 00000 or at such other time or place
as the Company and the Purchasers may mutually agree (such date is hereinafter
referred to as the "Initial Closing Date"). The total number of Shares to be
purchased by all Purchasers in the Initial Closing shall be eight million seven
hundred twenty three thousand four hundred five (8,723,405), as set forth on
Exhibit A.
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2.2 Subsequent Closings. Subject to satisfaction of the conditions to
closing set forth in Section 6.2, two subsequent closings of the sale and
purchase of the Shares under this Agreement (together, the "Subsequent
Closings") shall take place, the first at 9:00 a.m. on June 30, 2000 (the
"Second Closing") and the second at 9:00 a.m. on September 29, 2000 (the "Final
Closing"), at the offices of Holland & Xxxx LLP, 000 Xxxxxxxxxxx Xxxxxx, Xxxxx
0000, Xxxxxx, XX 00000, or at such other time or place as the Company and the
Purchasers may mutually agree (such dates are hereinafter referred to together
as the "Subsequent Closing Dates"). Notwithstanding the foregoing, the Company's
Board of Directors (the "Board of Directors"), in its sole discretion, may
accelerate either of the Subsequent Closing Dates at any time upon at least 5
business days advance written notice to the Purchasers, although the Company
will use commercially reasonable efforts to attempt to provide at least 10
business days advance written notice of any such accelerated Subsequent Closing
Date. The total number of Shares to be purchased by all Purchasers in the Second
Closing is four million three hundred sixty one thousand seven hundred four
(4,361,704) and the total number of Shares to be purchased in the Final Closing
is four million three hundred sixty one thousand seven hundred four (4,361,704),
as set forth on Exhibit A. Each Purchaser shall have the right to purchase the
Shares which could have been purchased in any Subsequent Closing at the price
set forth in Section 1.2 above at any time in its sole discretion prior to a
liquidity event or for any other reason.
2.3 Certificates; Payment. Each of the Initial Closing, the Second
Closing and the Final Closing is referred to herein individually as a "Closing,"
and collectively they are referred to herein as the "Closings." Each of the
Initial Closing Date and the Subsequent Closing Dates is referred to herein
individually as a "Closing Date," and collectively they are referred to herein
as the "Closing Dates." On each Closing Date, the Company shall deliver to each
Purchaser a certificate (or certificates in denominations reasonably designated
by Purchaser) representing all of the Shares purchased by such Purchaser at such
Closing.
2.4 Absolute Commitment. Each Purchaser acknowledges and agrees that,
if the Initial Closing occurs, its obligation to purchase a number of Shares in
all Closings equal to its Purchaser Share Limit constitutes an absolute,
irrevocable and unconditional obligation, and shall not be subject to
counterclaim, set-off, deduction or defense, or to abatement, suspension,
deferment, diminution or reduction for any reason whatsoever (other than the
failure to satisfy the closing conditions set forth in Section 6 below). By way
of amplification, and not in limitation of the foregoing, each Purchaser further
acknowledges and agrees to fulfill its obligations regardless of any claims it
may have against the Company, any other Purchaser or Person (whether or not
related to the transactions contemplated hereby) and regardless of the existence
or non-existence of any facts or circumstances (whether or not such facts and
circumstances existed on the date hereof or any of the Closing Dates or were
then known by it).
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3. CONSEQUENCES UPON DEFAULT.
If any Purchaser fails to pay to the Company on any Subsequent Closing
Date the full purchase price for the Shares to be purchased by such Purchaser in
such Closing, as set forth in Exhibit A (a "Default", and the amount of such
defaulted purchase price, the "Defaulted Commitment"), then such Purchaser shall
be subject to all of the consequences set forth in this Article 3 (such
Purchaser is referred to as a "Defaulting Purchaser").
3.1 Specific Performance. The Company shall be entitled to specific
performance of each Purchaser's obligation to purchase the Shares in each
Closing set forth opposite such Purchaser's name on Exhibit A and the Company's
right to receive the full amount of the purchase price for those Shares. Each
Purchaser acknowledges that money damages would be an inadequate remedy for any
Default or other breach of its obligations under this Agreement and consents to
an action for specific performance or other injunctive relief in the event of
any Default or other breach of this Agreement by such Purchaser.
3.2 Board Representative(s). Immediately upon the occurrence of a
Default, the representative(s) appointed by the Defaulting Purchaser to the
Board of Directors, if any, (the "Board Representative(s)") in accordance with
Section 5.1 of the Investor's Agreement, shall resign effective immediately and
the Defaulting Purchaser shall forfeit its right to designate any
representative(s) to fill such vacancy(ies) or to appoint any other
representative(s) to the Board of Directors. If the Default continues uncured
for a period exceeding 10 days after the Default, the Defaulting Purchaser shall
also lose its right to have an observer present at any meeting of the Board of
Directors, as provided in Section 5.1(a)(vi) of the Investors Agreement or at
any meeting of the board of directors or other governing body of any subsidiary
of the Company. If the Defaulting Purchaser cures its Default within the 10-day
period following such Default by making payment to the Company of (i) the
Defaulted Commitment, (ii) the Premium (as that term is defined below) and (iii)
the Liquidated Damages (as that term is defined below) (such actions
collectively are referred to herein as a "Cure" for a Default), the Defaulting
Purchaser shall regain its right to designate such Board Representative(s) and
to have observers present at such meetings of the Board of Directors of the
Company and its subsidiaries.
3.3 Irrevocable Proxy.
(a) Each Purchaser hereby irrevocably appoints the Company as
its attorney-in-fact and proxy of such Purchaser, with full power of
substitution, to be immediately effective without any action on the part of such
Purchaser or the holder thereof on each occurrence and during the continuance of
a Default (unless the Default is Cured):
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(i) to attend any meeting (whether annual or special)
of the Company at which the vote of the holders of the Series B/B-1 Preferred
Stock is permitted or required, including any adjournment or postponement of any
such meetings;
(ii) to vote the Shares owned by such Purchaser on
any matter permitted or required to be voted upon by the holders of Series B/B-1
Preferred Stock under the Certificate of Incorporation or the Investors
Agreement, including the right to designate or remove any representative to the
Board of Directors; and
(iii) to execute and deliver one or more consents in
writing pursuant to any action by the Company's stockholders proposed to be
taken by unanimous written consent under any applicable law in lieu of voting at
any such meeting or adjournment thereof.
(b) Each Purchaser affirms that this proxy and power of
attorney is issued in order to facilitate the transactions contemplated by this
Agreement and the Investors Agreement and as such is coupled with an interest
and is irrevocable. This proxy will terminate upon each Purchaser's satisfying
in full its obligations hereunder.
(c) Each Purchaser agrees that prior to the full funding of
the purchase price of the Shares comprising such Purchaser's Purchaser Share
Limit, it will not sell, transfer, or otherwise dispose of or cause to be
disposed of any Shares owned by such Purchaser unless such Purchaser or
transferee agrees in writing prior to the sale, transfer or other disposition to
be bound by and subject to the provisions contained in this Section 3.3.
(d) All authority conferred or agreed to be conferred in this
Section 3.3 shall survive the death, dissolution, liquidation or incapacity of
each Purchaser and any obligation of such Purchaser shall be binding upon the
heirs, personal representatives, successors and assigns of such Purchaser. No
Purchaser will give any subsequent proxy with respect to such Shares owned by
the Purchaser that purports to grant authority within the scope of the authority
conferred in this Section 3.3.
3.4 Premium. In the event a Defaulting Purchaser elects to Cure its
Default, such Defaulting Purchaser shall pay to the Company within the 10-day
Cure period a premium equal to 25% of the Defaulted Commitment due in respect of
such Shares (the "Premium"). This amount shall be in addition to the Defaulted
Commitment and the Liquidated Damages provided for below.
3.5 Liquidated Damages. Immediately upon the occurrence of a Default,
the Defaulting Purchaser shall pay to the Company a sum equal to 50% of the
Defaulted Commitment as liquidated damages (the "Liquidated Damages"). Each
Purchaser agrees that this amount is reasonable in light of the fact that
damages resulting from a Default would be difficult to determine because the
Company would be required to invest
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significant time and resources in order to find another purchaser or source of
funding to replace the Defaulted Commitment by such Defaulting Purchaser. Each
Purchaser also acknowledges that this amount is not a penalty.
3.6 Conversion Rights. If a Defaulting Purchaser does not Cure such
Default within the 10-day cure period, the conversion price for the Shares owned
by such Defaulting Purchaser shall be adjusted as provided in the Certificate of
Incorporation.
4. REPRESENTATIONS AND WARRANTIES OF THE COMPANY
Except for the representations and warranties of the Company set forth
in Sections 4.12, 4.13 and 4.14, all representations and warranties made by the
Company pursuant to this Section 4 regarding the Brazilian Companies and the
Acquired Subsidiaries shall be made to the knowledge of the Company. The Company
hereby represents and warrants to each Purchaser as of the date hereof, as
follows:
4.1 Organization and Standing. Each of the Companies is duly organized,
validly existing and in good standing under the laws of its jurisdiction of
incorporation. Each of the Companies has all requisite corporate power and
authority to own and operate its properties and assets and to carry on its
businesses as presently conducted and as presently proposed to be conducted.
Each of the Companies is qualified to do business in each jurisdiction where the
failure to be so qualified would result in a material adverse effect on the
business, operations, assets, prospects or condition (financial or otherwise) of
any of the Companies (a "Material Adverse Effect"). The copies of the Company's
and each Subsidiaries' charter documents and by-laws or other constituent
documents which have been furnished to the Purchasers' special counsel reflect
all amendments made thereto at any time prior to the date of this Agreement and
are correct and complete.
4.2 Capitalization of the Company. The authorized capital stock of the
Company, immediately prior to the Initial Closing Date, shall consist of (a) one
hundred eight million six hundred thirty four thousand four hundred twenty one
(108,634,421) shares of Common Stock, of which (i) one hundred six million six
hundred sixty six thousand six hundred sixty seven (106,666,667) will be
designated as Voting Common Stock, eleven million two hundred eighty three
thousand eight hundred twenty six (11,283,826) of which will be issued and
outstanding immediately prior to the Initial Closing Date, and (ii) one million
nine hundred sixty seven thousand seven hundred fifty four (1,967,754) will be
designated as Non-Voting Common Stock, none of which will be issued and
outstanding immediately prior to the Initial Closing Date, and (b) seventy eight
million six hundred thirty four thousand four hundred twenty one (78,634,421)
shares of Preferred Stock, of which (i) thirty-one million (31,000,000) will be
designated as Series A Preferred Stock, thirty million seven hundred six
thousand three hundred thirty-three (30,706,333) of which will be issued and
outstanding immediately prior to the Initial Closing Date, (ii) forty one
million six hundred sixty six
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thousand six hundred sixty seven (41,666,667) will be designated as Series B
Preferred Stock, of which seven million six hundred fifty-seven thousand
seventy-three (7,657,073) will be issued and outstanding immediately prior to
the Initial Closing Date, and an additional thirty four million nine thousand
five hundred ninety three (34,009,593) shares of which will have been committed
to be sold by the Company immediately prior to the Initial Closing Date and
(iii) one million nine hundred sixty seven thousand seven hundred fifty four
(1,967,754) will be designated as Series B-1 Preferred Stock, of which no shares
will be issued and outstanding immediately prior to the Initial Closing Date,
but all of which will have been committed to be sold by the Company immediately
prior to the Initial Closing Date. All issued and outstanding shares of the
Company's Common Stock, Series A Preferred Stock and Series B/B-1 Preferred
Stock have been duly authorized, validly issued and are fully paid and
non-assessable. Except for the three million seven hundred ninety-eight thousand
five hundred forty-four (3,798,544) options outstanding immediately prior to the
Initial Closing Date, except for the conversion privileges of the Series A
Preferred Stock, Series B Preferred Stock and Series B-1 Preferred Stock, except
for the shares of Series B Preferred Stock to be purchased pursuant to the
Series B Preferred Stock Purchase Agreement dated as of December 6, 1999 among
the Company and the Purchasers listed on the Schedule of Purchasers attached
thereto, as amended by Amendment No. 1 thereto, dated as of December 31, 1999,
and except as disclosed in this Agreement or in the exhibits or schedules
attached hereto, there will be no options, warrants or other rights to purchase
from the Company any of its equity securities that are outstanding immediately
prior to the Initial Closing Date. The Company will not have in place any stock
appreciation rights or phantom stock plans immediately prior to the Initial
Closing Date. A chart showing the accurate and complete capitalization of the
Company immediately prior to and immediately after the Initial Closing Date is
attached hereto as Exhibit C.
4.3 Authority.
(a) The Company has full power, right and authority to execute
the Transaction Documents and to perform all of its obligations hereunder and
thereunder. The execution and delivery of the Transaction Documents by the
Company has been, and consummation by the Company of the transactions
contemplated thereby has been, duly authorized by all necessary action of the
Company. The Transaction Documents have been duly and validly executed and
delivered by the Company and constitute the legal, valid, binding and
enforceable obligation of the Company subject to applicable bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium and other similar
Laws affecting creditors' rights generally and subject, as to enforceability, to
general principles of equity (regardless of whether enforcement is sought in a
proceeding at law or in equity). The execution, delivery and performance by the
Company of the Transaction Documents and the consummation of the transactions
contemplated thereby will not (i) conflict with or violate any Contracts or
Permits to which the Companies are a party or bound and, in particular, will not
cause prepayment
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of any banking or other indebtedness of any of the Companies and will not
otherwise give any other Person the right to accelerate, renegotiate or
terminate or receive any payment and will not constitute a default, event of
default or an event which with the passage of time or lack of notice, or both,
would constitute a default or event of default under such Contract, (ii)
conflict with or violate any provision of any applicable Legal Requirement to
which any Company is subject, (iii) conflict with or violate any Judgment
applicable to any of the Companies, or (iv) conflict with, or result in a breach
or default under, any term or condition of the constituent documents of the
Companies.
(b) When issued in compliance with the provisions of this
Agreement and paid for by each Purchaser, the Shares and, when issued upon
conversion of the Shares, the Common Stock so issuable, will be validly issued,
fully paid and nonassessable and will not have been issued in violation of any
preemptive rights. The Shares will have the benefit of the terms and provisions
of the Certificate of Incorporation.
4.4 Consents and Approvals. Except as set forth on Schedule 4.4, no
consent, license, approval, waiver, expiration of waiting period or
authorization of, or registration or declaration with, any municipal, local,
state, federal, domestic or foreign governmental authority, agency, bureau or
commission, or any other Person (a "Consent"), is required to be obtained or
made by the Companies, in connection with its execution, delivery, performance
of the Transaction Documents and enforceability of its respective obligations
under the Transaction Documents and the transactions contemplated thereby.
4.5 Compliance with Laws.
(a) Except as set forth on Schedule 4.5(a), each of the
Companies has been and is currently in compliance in all material respects with
all (i) Environmental Laws, (ii) applicable telecommunications Laws, and (iii)
material Legal Requirements. None of the Companies has received (A) any
citations, notices of violations, complaints, consent orders (or amendments to
or modifications of such orders), compliance schedules or other similar
enforcement orders, or (B) any written notice in any form, including inspection
reports, from any governmental entity or any other Person which in any case
would indicate that there was not then or is not currently such compliance with
all such Legal Requirements.
(b) Schedule 4.5(b) sets forth an accurate and complete list
of all material Permits which are used or held by each of the Companies in
connection with the operation of its business. The Company represents that (i)
all material Permits of each of the Companies are in full force and effect, (ii)
any applications for renewal of any material Permit due prior to the Closing
have been, or will be, timely filed prior to the Closing, (iii) no proceeding or
other legal action to modify, suspend, revoke, withdraw, terminate or otherwise
limit any such material Permit is pending or, to the knowledge of the Company,
threatened, and (iv) each of the Companies has made all
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payments required to be made under all material Permits, including, without
limitation, in respect of any Licenses.
4.6 Trademarks, Patents, Trade Names, etc.
(a) Schedule 4.6 contains a listing of all patents, know-how,
trademarks, trade names, service marks, service names, copyrights and other
intellectual or proprietary property used in the conduct of each of the
Companies' businesses (the "Patent and Trademark Rights"). Except as set forth
on Schedule 4.6, none of the Companies has received any notice from any other
Person challenging the right of any of them to use any such Patent and Trademark
Rights owned or used by or licensed to each of the Companies. The Company has no
knowledge that any Patent and Trademark Right is being infringed upon or
appropriated by others, and none is subject to any outstanding Judgment
affecting the scope of the free and unrestricted use by any of the Companies or
is used contrary to the provisions of any licensing or other agreement. The
Company has no knowledge that there are any geographic restrictions on the use
by any of the Companies of the Patent and Trademark Rights.
(b) The Companies have not entered into any agreement or
arrangement for the provision or acquisition of any Patent and Trademark Rights.
4.7 Actions Pending. There is no suit, action, claim, arbitration or
similar proceeding or investigation pending or, to the Company's knowledge,
threatened against any of the Companies (i) which, if adversely resolved, would
be reasonably likely to have a Material Adverse Effect, (ii) with respect to
which there is a reasonable likelihood of a determination which would prevent
the Company from consummating the transactions contemplated by the Transaction
Documents, or (iii) which seeks to enjoin or obtain damages in respect of the
consummation of the transactions contemplated by the Transaction Documents. None
of the Companies is a party to or is bound by any Judgment of any governmental
authority, arbitrator or any other Person. None of the Companies has
compromised, settled or lost any arbitration or judicial or administrative
proceeding.
4.8 Contracts.
(a) Schedule 4.8 contains an accurate and complete list of all
Contracts to which any of the Companies is a party or by which any of such
Companies' assets or properties are bound or affected and which (i) involve the
obligation (including contingent obligations) to pay by or to any of such
Companies amounts in excess of US$100,000 in the aggregate in respect of the
Company and the Subsidiaries and amounts in excess of US$1,000,000 in the
aggregate in respect of the Brazilian Companies, (ii) are Contracts with any
stockholder or member or any Affiliate of any stockholder or member, (iii) are
Contracts with governmental entities, or (iv) were not entered into in the
ordinary course of business of any of such Companies.
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(b) All Contracts are valid, binding and enforceable by each
of the respective Companies in accordance with their respective terms and none
of such Companies is in default in any material respect under any of such
Contracts nor, to the knowledge of the Company, is there any basis for any valid
claim of default or violation under any Contract. To the knowledge of the
Company, no other party to any of such Contracts is in default in any material
respect thereunder nor does there exist any event or condition, which upon the
giving of notice or the lapse of time or both, would (i) constitute a default in
any material respect or event of default thereunder or (ii) entitle any other
party thereto to terminate such Contract.
(c) None of the Companies is a party to any Contract
containing an undertaking on its part not to compete in any business, industry
or geographical area except as set forth in the Licenses.
4.9 Investments in United States Real Property Interests. The Company's
capital stock does not, and the Company shall use its reasonable commercial
efforts to ensure that its capital stock will not, constitute a United States
real property interest as that term is defined in Section 897(c)(1)(A)(ii) of
the Internal Revenue Code of 1986, as amended (the "Code"). The preceding
representation is based on a determination by the Company that the Company is
not and has not been a United States real property holding corporation (as that
term is defined in Section 897(c)(2) of the Code) ("USRPHC") during the five (5)
year period preceding the date of this Agreement. From time to time, upon the
request of any Purchaser, the Company shall make a determination as to its
status as a USRPHC. If at any time in the future the Company should become a
United States real property holding corporation, the Company shall, as promptly
as possible, notify each Purchaser of such change in status.
4.10 Unrelated Business Taxable Income. The Company shall use its
reasonable commercial efforts to ensure that any gross income derived by a
Purchaser from the Company shall be in the form of dividends, interest, capital
gains and losses from the disposition of property, and rents and royalties, but
only such rents and royalties as are excluded pursuant to Code Sections
512(b)(2) and 512(b)(3), respectively, in calculating unrelated business taxable
income and only such dividends, interest, capital gains and losses, and rents
and royalties that are not included under Section 512(b)(4) of the Code in
calculating unrelated business taxable income.
4.11 Not a Qualified Small Business. The Company does not qualify as a
"Qualified Small Business" as defined in Section 1202(d) of the Code.
4.12 Subsidiaries. Schedule 4.12 sets forth the current ownership
structure of the Company and its Subsidiaries.
4.13 Capitalization of the Company's Subsidiaries. Schedule 4.13 sets
forth the outstanding capital of each of the Companies (other than the Company),
the number of their authorized and issued shares or equity interests and their
nominal value. All of the
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shares or equity interests of the Companies (other than the Company) have been
duly authorized, validly issued and are fully paid and non-assessable. The
Companies (other than the Company) have no other shares or equity interests of
any kind authorized or outstanding, no outstanding securities convertible into
or exchangeable for or carrying the right to acquire any equity security of any
of the Companies (other than the Company) and no outstanding options, warrants
or other agreements or commitments under which any of the Companies (other than
the Company) are obligated to issue any additional shares or equity interests.
None of the shares of the Companies (other than the Company) is subject to any
Encumbrances except as set forth on Schedule 4.13.
4.14 Share Ownership.
(a) Schedule 4.14(a) sets forth a true and correct list of the
stockholders of the Company, the number of shares owned by the stockholders of
the Company and the percentage ownership represented by each such stockholding.
(b) Schedule 4.14(b) sets forth a true and complete list of
(i) all stockholders agreements, limited liability company agreements or other
agreements in respect of or relating to the equity interests in the Companies to
which the Company or any of its Subsidiaries is a party, and (ii) all Contracts
relating to the purchase, sale, transfer or other disposition of any securities
or equity interests of any of the Companies to which the Company or any of its
Subsidiaries is a party.
4.15 Financial Statements. The Company has delivered to each Purchaser
unaudited balance sheets and the related unaudited income statement and retained
earnings statements for the periods set forth therein of (x) the Company at
December 31, 1998 and September 30, 1999, (y) MegaTel do Brasil S.A., Telelatina
Management Company, Smartel S.A., Formus S.A. and Telelatina S.A. at June 30,
1999 and (z) Xxxxxx X.X. at May 31, 1999 (the items referred to in (x), (y) and
(z) are referred to herein collectively as the "Financial Statements"). Except
as may be otherwise noted therein, the Financial Statements present fairly, in
all material respects in accordance with generally accepted accounting
principles then in effect, the financial position of each of the Companies as of
the date set forth therein and the results of operations of each of such
Companies for the periods set forth therein, except that the Financial
Statements (i) do not have all footnotes required by generally accepted
accounting principles and (ii) are subject to normal, year-end adjustments.
4.16 Material Changes. Except as set forth in the Financial Statements,
since the date of the latest respective Financial Statements (i) there have been
no changes in the business, operations, assets or liabilities of any of the
respective Companies which, individually or in the aggregate, has had or would
be reasonably likely to have, a Material Adverse Effect; (ii) none of such
Companies has made or declared any dividend or declared, made or paid any other
distribution in respect of its capital stock; (iii) none of such Companies has
suffered any casualty which resulted in damage,
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destruction or loss (whether or not covered by insurance); and (iv) none of such
Companies has suffered any strike or other work stoppage.
4.17 Title. Each of the Companies has (i) with respect to real property
which is leased and used by it in its business, valid and subsisting leasehold
interests and (ii) with respect to the owned or leased personal property and
assets used by it in its business, good title or valid leasehold interests, in
each instance, free and clear of any Encumbrances, except Permitted Encumbrances
or any Encumbrances reflected on the Financial Statements.
4.18 Licenses.
(a) Schedule 4.18 sets forth a complete list of all of the
telecommunications licenses held by the Companies (the "Licenses"). Each of the
Licenses listed in Schedule 4.18 was duly authorized, granted and delivered by
the appropriate governmental entity or an instrumentality thereof to such of the
Companies identified in Schedule 4.18 as holding such License and recorded with
the appropriate government entity in accordance with all applicable Legal
Requirements. Each of the Licenses is held by such of the Companies identified
in Schedule 4.18 as holding such License, free and clear of any Encumbrance or
other attachments and duties of any kind except as set forth in the relevant
License. There are no restrictions or limitations on the use of the rights
granted by the Licenses except for those expressly set forth in each of the
Permits, Licenses and applicable Law.
(b) Since the award of the Licenses, each of the Companies
holding a License has complied in all material respects with the terms and
conditions of the License held by it and with the applicable telecommunications
Laws (including any required build-out deadlines and notice or filing
obligations) and has made all necessary payments required to be made thereunder.
None of the transactions contemplated hereby will result or has resulted in the
termination, modification, suspension or revocation of any License.
4.19 Insurance. Each of the Companies has in place adequate and
appropriate insurance policies, given its industry and its current stage of
development. None of the Companies has been notified of any cancellation of or
any refusal of any insurance coverage relating to its operations by any
insurance carrier to which it has applied for insurance since its formation.
Each of the Companies is in compliance in all material respects with such
insurance policies and has paid all outstanding premiums when and as due. There
is no pending claim under any insurance policy to which any of the Companies is
an insured or beneficiary or any fact or circumstance reasonably likely to give
rise to such a claim.
4.20 Liabilities. Except as set forth in the Financial Statements, on
Schedule 4.20, or in the Licenses or Contracts, none of the Companies has
incurred any
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outstanding material obligation, debt or liability, fixed or contingent
("Liabilities") to any Person.
4.21 Taxes.
(a) The Companies have filed all federal, state, departmental,
municipal and foreign Tax returns required by law to be filed by them other than
such filings, the failure of which to have been made, would not reasonably be
likely to result in the imposition of significant penalties on any of the
Companies. Except as set forth on the Financial Statements, and except for taxes
the failure of which to pay would not reasonably be likely to result in the
imposition of significant penalties on any of the Companies, each of the
Companies has paid all such taxes that have already become due and payable. The
provisions shown on the Financial Statements are adequate to reflect any
material amount of unpaid Taxes of the Companies due or to become due with
respect to fiscal periods ended on or before the date of the Financial
Statements. As of the date hereof, there is no claim or assessment pending
against the Company or any of the other Companies, based on a failure to pay
Taxes and no basis exists for any such claim.
(b) The Company is not aware of and, to the Company's
knowledge, there are no circumstances which, either by passage of time or
issuance of an assessment binding on any of the Companies to pay any Tax or
contribution, may give rise to any type of dispute with any Tax authority in
relation to any Tax obligation or liability.
4.22 Collective Bargaining Agreements, Employment Agreements and
Employee Relations.
(a) Except as set forth on Schedule 4.22(a), none of the
Companies has in effect any collective bargaining agreement or employment
agreement which is not terminable at will in accordance with the laws of the
jurisdictions in which it operates. Except as set forth on Schedule 4.22(a),
there are no disputes currently subject to any grievance procedure, arbitration
or litigation under such collective bargaining agreements or employment
agreements nor is there any default under any such agreements, by any of the
Companies or to the knowledge of the Company, any other party thereto.
(b) Schedule 4.22(b) sets forth all employees and directors of
the Company and their remuneration rates, applicable benefits and the applicable
term of their employment.
4.23 Employee Benefits.
(a) Except as set forth on Schedule 4.23, the Companies do not
maintain or contribute to or have any liability with respect to (i) any
incentive, bonus, commission or deferred compensation or severance or
termination pay plan, agreement
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or arrangement for the benefit of employees employed by it or any director, (ii)
any pension, profit-sharing, stock purchase, stock option, group life insurance,
hospitalization insurance, disability, retirement or any other employee benefit
plan, agreement or arrangement, for the benefit of employees employed by it or
any director or (iii) any fringe benefit plan, agreement or arrangement for the
benefit of employees employed by it or any director (the items referred to in
(i), (ii), and (iii) above are hereinafter referred to collectively as, the
"Plans" and individually as a "Plan").
(b) There are no scheduled or agreed-upon future increases of
benefit levels for employees employed by any of the Companies, and no increases
in benefits have (i) been proposed by any of the Companies for the benefit of
its employees or any director, (ii) been made the subject of representation or
similar communication by any of the Companies to their employees or directors or
(iii) to the knowledge of the Company, been requested or demanded by employees
employed by any of the Companies under circumstances which make it reasonable to
expect that such increase will be granted.
(c) Each of the Companies has made all requisite pension and
other governmental and/or social security contributions on its own behalf and on
behalf of its employees and is in compliance in all material respects with all
labor and social security obligations pursuant to the applicable Laws and Legal
Requirements.
4.24 Recordkeeping Compliance. Except as set forth on Schedule 4.24,
each of the Companies has maintained its books and records and accounts in
accordance with all applicable Legal Requirements, and all corporate and other
documents required to be submitted to relevant federal, state, departmental and
municipal authorities by each of such Companies have been duly and punctually
submitted and have been true and correct in all material respects.
4.25 Condition of the Companies; Operation of Business in the Ordinary
Course. All of the material equipment, buildings and other assets of each of the
Companies used in connection with the operation of its businesses are in good,
workmanlike condition and fit for use for its intended purpose, ordinary wear
and tear excepted.
4.26 Y2K Compliance. Each of the Companies has taken steps to verify
from vendors that on and following January 1, 2000, (i) its computer systems and
(ii) equipment containing embedded microchips (including systems and equipment
supplied by others or with which the systems of such Company interface) will
function properly. The cost to each of the Companies of the reasonably
foreseeable consequences of the Year 2000 to the respective company resulting
from the failure of its systems cannot be reasonably expected to have a Material
Adverse Effect. Each of the Companies has complied with the Year 2000
requirements, if any, established by the corresponding authorities.
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4.27 Broker's Fees. Except for any fees owed to Xxxxxx Brothers,
Xxxxxxxxx Lufkin & Xxxxxxxx and TD Securities, for which the Purchasers have no
liability, the Company has not employed any broker, finder, consultant or
intermediary in connection with the transactions contemplated by the Transaction
Documents that would be entitled to a broker's, finder's or similar fee or
commission in connection therewith.
4.28 Foreign Corrupt Practices Act. The Company represents that (i) it
has not taken any action which is or could be deemed to be a violation of the
Foreign Corrupt Practices Act in respect of any of the Companies; (ii) it is not
aware of any action or conduct which could be deemed to be a violation of the
Foreign Corrupt Practices Act in respect of any of the Companies and (iii) none
of its managers, officers, directors, employees, stockholders, members, agents
or representatives has offered, given, paid, authorized the payment of, or
promised, directly or indirectly, any money, gift, promise or other thing of
value to any Foreign Official (or to any other Person while knowing it will be
offered, given or promised to a Foreign Official) for any purpose including, by
way of example but not limitation, influencing any act or decision of such
Person acting in their official capacity, inducing such Person to do or omit to
do any action in violation of their lawful duty, inducing such Person to use
their influence with the government of the Republic of Argentina, the Republic
of Peru, the Republic of Colombia, the Republic of Venezuela, the Republic of
Uruguay, the Republic of Chile, the Federative Republic of Brazil or any other
government or any instrumentality thereof to affect or influence any act or
decision of such government or instrumentality, in order to assist any of the
Companies or their stockholders or members to obtain or retain business for or
with, or in directing business to, any Person.
4.29 Offering. Subject to the accuracy of the Purchasers'
representations in Section 5 hereof, the offer, sale and issuance of the Shares,
and of any Common Stock into which the Shares are convertible (the "Conversion
Shares") constitute transactions exempt from the registration requirements of
Section 5 of the Securities Act of 1933, as amended (the "Securities Act") and
state Blue Sky laws.
4.30 Spectrum Allocation. The spectrum allocation held by or available
for use by each of the Companies is reasonably sufficient to enable such of the
Companies to satisfy its current business plan as presented to the Purchasers
except where the failure to have such allocation will not have a Material
Adverse Effect on such of the Companies; provided that in respect of the
Brazilian Companies, in the event any such Brazilian Company needs additional
spectrum to satisfy its current business plan objectives, the Company reasonably
believes that such spectrum should be available from ANATEL so long as such
Brazilian Company has complied with its existing license obligations.
5. REPRESENTATIONS AND WARRANTIES OF THE PURCHASERS
Each Purchaser severally and not jointly hereby represents and warrants
to the Company, as of the date hereof, as follows:
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5.1 Requisite Power and Authority. Such Purchaser has all necessary
power and authority under all applicable provisions of law to execute and
deliver this Agreement and to carry out its provisions. All actions on such
Purchaser's part required for the lawful execution and delivery of this
Agreement have been or will be effectively taken prior to the Initial Closing.
5.2 Investment Representations. Such Purchaser understands that neither
the Shares nor the Conversion Shares have been registered under the Securities
Act. Such Purchaser also understands that the Shares are being offered and sold
pursuant to an exemption from registration contained in the Securities Act based
in part upon the Purchaser's representations contained in this Agreement.
(a) Purchaser Bears Economic Risk. Such Purchaser has
substantial experience in evaluating and investing in private placement
transactions of securities in companies similar to the Company so that it is
capable of evaluating the merits and risks of its investment in the Company and
has the capacity to protect its own interests. Such Purchaser must bear the
economic risk of this investment indefinitely unless the Shares (or the
Conversion Shares) are registered pursuant to the Securities Act, or an
exemption from registration is available. Such Purchaser understands that the
Company has no present intention of registering the Shares, the Conversion
Shares or any shares of its Common Stock. Such Purchaser also understands that
there is no assurance that any exemption from registration under the Securities
Act will be available and that, even if available, such exemption may not allow
such Purchaser to transfer all or any portion of the Shares or the Conversion
Shares under the circumstances, in the amounts or at the times such Purchaser
might propose.
(b) Acquisition for Own Account. Such Purchaser is acquiring
the Shares and the Conversion Shares for its own account for investment only,
and not with a view towards their distribution in violation of applicable
securities laws.
(c) Purchaser Can Protect Its Interest. Such Purchaser
represents that, by reason of its or of its management's business or financial
experience, such Purchaser has the capacity to protect its own interests in
connection with the transactions contemplated in this Agreement.
(d) Accredited Investor. Such Purchaser represents that it is
an accredited investor within the meaning of Regulation D under the Securities
Act.
(e) Company Information. Such Purchaser has had an opportunity
to discuss the Company's business, management and financial affairs with
directors, officers and management of the Company. Such Purchaser has also had
the opportunity to ask questions of, and receive answers from, the Company and
its management regarding the terms and conditions of this investment.
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(f) Rule 144. Such Purchaser acknowledges and agrees that the
Shares and the Conversion Shares must be held indefinitely unless they are
subsequently registered under the Securities Act or an exemption from such
registration is available. Such Purchaser has been advised or is aware of the
provisions of Rule 144 promulgated under the Securities Act, which permits
limited resale of shares purchased in a private placement subject to the
satisfaction of certain conditions, including, among other things: the
availability of certain current public information about the Company, the resale
occurring not less than one year after a party has purchased and paid for the
security to be sold, the sale being through an unsolicited "broker's
transaction" or in transactions directly with a market maker (as said term is
defined under the Securities Exchange Act of 1934, as amended) and the number of
shares being sold during any three-month period not exceeding specified
limitations.
5.3 Broker's Fees. None of the Purchasers has employed any broker,
finder, consultant or intermediary in connection with the transactions
contemplated by the Transaction Documents that would be entitled to a broker's
finder's or similar fee or commission in connection therewith.
6. CONDITIONS PRECEDENT TO PURCHASERS' OBLIGATIONS
6.1 Conditions to Initial Closing. The obligation of each Purchaser to
purchase and pay for the Shares to be delivered to it at the Initial Closing
shall be subject to the satisfaction of the following conditions as of the
Initial Closing Date:
(A) the representations and warranties of the Company
contained in this Agreement shall be true and correct on and as of the Initial
Closing Date (a certificate stating such representations and warranties are true
and correct shall be delivered by the Company to the Purchasers on the Initial
Closing Date);
(B) concurrent with the Initial Closing, the Company
and the Purchasers shall have entered into the Third Amended and Restated
Investors Agreement in the form attached hereto as Exhibit D;
(C) each Purchaser shall have received from Holland &
Xxxx LLP, counsel for the Company, an opinion in substantially the form attached
hereto as Exhibit E, dated as of the Initial Closing Date;
(D) any applicable waiting periods under the
Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 1976, as amended, (the "HSR
Act") with respect to such Purchaser's acquisition of Shares in the Initial
Closing, shall have expired or otherwise been terminated;
(E) the Certificate of Incorporation shall have been
filed with the Delaware Secretary of State; and
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(F) as to BankAmerica Investment Corporation ("BAIC")
only, its Investment Committee shall have approved BAIC's purchase of up to
US$25 million of the Shares hereunder.
6.2 Conditions to Subsequent Closings. The obligation of each Purchaser
to purchase and pay for the Shares to be delivered to it at any Subsequent
Closing shall be subject to the satisfaction of the following conditions as of
such Subsequent Closing Date:
(A) any applicable waiting periods under the HSR Act
with respect to such Purchaser's acquisition of Shares in the Subsequent
Closing, shall have expired or otherwise been terminated; and
(B) as to BAIC only, with respect to the last US$10
million of the Shares to be purchased by BAIC in the Subsequent Closings, BAIC
shall have received internal approval for the purchase of such Shares.
7. VESPER BOARD OBSERVATION RIGHTS
The Company shall use its best efforts to permit one representative of
the holders of the Company's Series B/B-1 Preferred Stock to attend board
meetings of Vesper Holding S.A. and Vesper Sao Paulo Holding S.A. as an
observer. The observer for the initial 12-month period following the Initial
Closing Date shall be designated by BAIC and thereafter by the vote of two of
the three largest holders of Series B/B-1 Preferred Stock.
8. USE OF PROCEEDS
The Company shall use the proceeds from the sale of the Shares to
finance its commitments to the Brazilian Companies and the Subsidiaries, to fund
general corporate purposes including development activities, and to cover fees
and expenses related to the sale of the Shares.
9. MISCELLANEOUS
9.1 Governing Law. This Agreement shall be governed in all respects by
the laws of the State of Colorado as such laws are applied to agreements between
Colorado residents entered into and performed entirely in Colorado, except that
the General Corporation Law of the State of Delaware shall govern as to matters
of corporate law.
9.2 Survival. The representations, warranties, covenants and agreements
made herein shall survive any investigation made by any Purchaser and the
closing of the transactions contemplated hereby. All statements as to factual
matters contained in any certificate or other instrument delivered by or on
behalf of the Company pursuant hereto in connection with the transactions
contemplated hereby shall be deemed to be
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representations and warranties by the Company hereunder solely as of the date of
such certificate or instrument.
9.3 Successors and Assigns. Except as otherwise expressly provided
herein, the provisions hereof shall inure to the benefit of, and be binding
upon, the successors, assigns, heirs, executors and administrators of the
parties hereto.
9.4 Entire Agreement; Amendment and Waiver. This Agreement, the
Exhibits, Schedules and the other documents expressly delivered pursuant hereto,
including the Investors Agreement, supersede any other agreement, whether
written or oral, that may have been made or entered into by the parties hereto
relating to the matters contemplated hereby and constitute the full and entire
understanding and agreement between the parties with regard to the subjects
hereof, and no party shall be liable or bound to any other in any manner by any
representations, warranties, covenants and agreements except as specifically set
forth herein and therein. Neither this Agreement nor any term hereof may be
amended, waived, discharged or terminated except by a written instrument signed
by the Company and the holders of a majority of the Shares held by the
Purchasers, and any such amendment, waiver, discharge or termination shall be
binding on all Purchasers, except that if such amendment, waiver, discharge or
termination creates an obligation by any Purchaser, or if it adversely affects a
particular Purchaser in a manner different from the other Purchasers, the
consent of the affected Purchaser shall be required.
9.5 Specific Enforcement. Any Purchaser shall be entitled to specific
enforcement of its rights under this Agreement. The parties acknowledge that
money damages would be an inadequate remedy for its breach of this Agreement and
consent to an action for specific performance or other injunctive relief in the
event of any such breach.
9.6 Severability. Unless otherwise expressly provided herein, a
Purchaser's rights hereunder are several rights, not rights jointly held with
any of the other Purchasers. In case any provision of this Agreement shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.
9.7 Notices. All notices required or permitted hereunder shall be in
writing and shall be deemed effectively given: (i) upon personal delivery to the
party to be notified; (ii) when sent by confirmed telex or facsimile if sent
during normal business hours of the recipient, if not, then on the next business
day; (iii) five (5) days after having been sent by registered or certified mail,
return receipt requested, postage prepaid; or (iv) one (1) day after deposit
with a nationally recognized overnight courier, special next day delivery, with
verification of receipt. All communications shall be sent to the Company at 0000
Xxxxx Xxxxxxxx Xxxxx Xxxxxx, Xxxxx 000, Xxxxxxxxx, XX 00000, Attention: Vice
President - Strategic and Legal Affairs, with a copy to Holland & Xxxx LLP, 000
00xx Xxxxxx, Xxxxx 0000, Xxxxxx, XX 00000, Attention: Xxxx X. Xxxx, and to a
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Purchaser at the address set forth on Exhibit A attached hereto or at such other
address as the Company or Purchaser may designate by ten (10) days advance
written notice to the other parties hereto.
9.8 Counterparts; Facsimile. This Agreement may be executed in any
number of counterparts, each of which shall be an original, but all of which
together shall constitute one instrument. This Agreement may be executed and
delivered by facsimile.
9.9 Future Financings; Purchaser Obligations. Nothing contained in this
Agreement or any Purchaser's prior dealings with the Company shall be deemed to
constitute a commitment on the part of any Purchaser to participate in any
future financings by the Company. In connection with any merger involving the
Company, the indemnification obligations of each Purchaser (if any) shall be
several and not joint, and shall in no event exceed the amount of consideration
to be received by such Purchaser in the merger.
9.10 Expense Reimbursement. The Company hereby agrees to reimburse the
Purchasers for the fees and expenses incurred by the Purchasers in connection
with the due diligence review and negotiation and preparation of the Transaction
Documents (including the fees and expenses of one U.S. counsel which shall be
Xxxxxxxx & Xxxxx, one Brazilian counsel which shall be Tozzini, Freire, Xxxxxxxx
e Xxxxx Advogados and one Argentinean counsel which shall be Xxxxx Xxxxxx
Xxxxxxxx Xxxxxxx Arsten Martinez de Hoz, and one accounting firm for the
Purchasers) not to exceed an aggregate of $250,000 for all Purchasers. In
addition, the Company hereby agrees to pay any required filing fees under the
HSR Act relating to the acquisition by the Purchasers of the Shares.
9.11 Regulatory Compliance Matters. If any Regulated Holder or any of
its Affiliates has a Regulatory Problem, the Company will cooperate and assist
such Regulated Holder by taking such actions as may reasonably be necessary or
desirable in order to resolve such Regulatory Problem.
9.12 Understanding Among the Purchasers. The determination of each
Purchaser to purchase shares of the Series B/B-1 Preferred Stock pursuant to
this Agreement has been made by such Purchaser independent of any other
Purchaser and independent of any statements or opinions as to the advisability
of such purchase or as to the properties, business, prospects or condition
(financial or otherwise) of the Company and its Subsidiaries which may have been
made or given to such Purchaser by any other Purchaser or by any agent or
employee of any other Purchaser. Each Purchaser acknowledges and agrees that no
other Purchaser shall be responsible in any way or held liable or accountable to
any extent for any information, documents, materials, analysis, projections,
plans or other data (or compilations thereof) relating to the Company or the
transactions contemplated hereby (collectively, "Investment Data") provided to
such Purchaser by any other Purchaser, and each Purchaser agrees to hold
harmless and not make any claims against any other Purchaser with respect to any
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Investment Data provided to such Purchaser by such other Purchaser. In addition,
it is acknowledged by each of the other Purchasers that BAIC has not acted as an
agent of such Purchaser in connection with making its investment hereunder and
that BAIC shall not be acting as an agent of such Purchaser in connection with
monitoring its investment hereunder.
9.13 Acknowledgment Regarding Xxxxxxxx & Xxxxx. BAIC has retained
Xxxxxxxx & Xxxxx in connection with the purchase of Series B/B-1 Preferred Stock
pursuant to this Agreement and may in the future retain Xxxxxxxx & Xxxxx in
connection with the matters contemplated by this Agreement. Each of the other
Purchasers understands that Xxxxxxxx & Xxxxx is not representing and shall not
be deemed to be representing any of such other Purchasers in connection with the
purchase of Series B/B-1 Preferred Stock pursuant to this Agreement or other
matters contemplated by this agreement unless and until (i) specifically
requested by such other Purchasers and agreed to by Xxxxxxxx & Xxxxx, and (ii)
such other Purchasers sign a written retention and conflict waiver letter
provided by Xxxxxxxx & Xxxxx.
10. CERTAIN DEFINITIONS.
"Acquired Subsidiaries" means Smartel S.A., PCN Investments S.A.,
Interloop Americas Inc., Telelatina S.A., Formus S.A., Telelatina Management
Company, Formus Communications Latin America LLC, Formus Communications
Argentina LLC, Formus Communications Bolivia LLC, Formus Communications Colombia
LLC, Formus Communications Peru LLC, Formus Communications Venezuela LLC, Formus
S.A., Formus Bolivia S.A., Formus Comunicaciones de Chile Limitada, Formus
Colombia S.A. E.S.P., Formus Peru S.A. and Telecomunicaciones Interactivas de
Venezuela C.A..
"Affiliate" shall mean, with respect to any Person, any other Person
directly or indirectly controlling, controlled by or under common control with,
such Person; for purposes of this definition, "control" shall mean the
possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of an entity, whether through the
ownership of voting securities, by contract or otherwise.
"BHCA Rules" shall mean the Bank Holding Company Act and the rules and
regulations thereunder.
"Brazilian Companies" shall mean Xxxxxx X.X., Xxxxxx Holding S.A.,
Vesper Sao Paulo Holding S.A. and MegaTel do Brasil S.A., each of which is a
sociedade anonima formed under the Laws of the Federative Republic of Brazil.
"Companies" shall mean the Company, the Brazilian Companies and the
Subsidiaries (including the Acquired Subsidiaries).
"Contracts" shall mean any and all written contracts, agreements,
obligations, franchises, warranties, guaranties, undertakings, commitments,
understandings,
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arrangements, leases, licenses, registrations, easements, rights-of-way,
mortgages, bonds, notes and other instruments and obligations and interests
therein or rights thereunder, excluding any Permits, in each case which are
material to the business of any of the Companies, as the case may be.
"Encumbrances" shall mean any mortgage, imperfection of title, lien,
pledge, option, security interest, claim, charge or other encumbrance of any
kind whatsoever.
"Environmental Laws" shall mean any Laws or Legal Requirements relating
to human health and safety, pollution, protection or cleanup of the environment
(including, but not limited to, ambient air, surface water, groundwater, land
surface or subsurface strata and flora or fauna) and such other Laws or Legal
Requirements relating to the release, containment, removal, remediation,
response, cleanup or abatement of any sort of chemical or hazardous substance.
"Foreign Corrupt Practices Act" shall mean the Foreign Corrupt
Practices Act of the United States of America (15 U.S.C.A. Section 78dd) and any
successor statute or legislation.
"Foreign Official" means (i) an officer or employee of any government
other than the U.S. including but not limited to the Republic of Argentina, the
Republic of Peru, the Republic of Colombia, the Republic of Venezuela, the
Republic of Uruguay, the Republic of Chile or the Federative Republic of Brazil
or any political subdivision, department, agency or instrumentality thereof;
(ii) a Person acting in an official capacity for or on behalf of any such
government or department, agency or instrumentality; (iii) a member or official
of a political party in the Republic of Argentina, the Republic of Peru, the
Republic of Colombia, the Republic of Venezuela, the Republic of Uruguay, the
Republic of Chile or the Federative Republic of Brazil; (iv) a candidate for
political office in the Republic of Argentina, the Republic of Peru, the
Republic of Colombia, the Republic of Venezuela, the Republic of Uruguay, the
Republic of Chile or the Federative Republic of Brazil or (v) any other meanings
or interpretations given to the term under the Foreign Corrupt Practices Act as
it applies to any of the Companies.
"Investors Agreement" shall mean the Third Amended and Restated
Investors Agreement dated as of the Initial Closing Date, among the Company, the
Purchasers and certain other stockholders of the Company, a copy of which is
attached hereto as Exhibit D.
"Judgments" shall mean any and all judgments, orders, directives,
rulings, decisions, injunctions, decrees or awards of any federal, state,
municipal, departmental or foreign court, arbitrator or administrative or
governmental authority, bureau or agency.
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"Laws" shall mean all laws (whether statutory or otherwise), rules and
regulations of all governmental, judicial, legislative, executive,
administrative or regulatory authorities (federal, state, municipal,
departmental, foreign or otherwise).
"Legal Requirements" shall mean any and all applicable (i) Permits,
(ii) Laws, (iii) Judgments, and (iv) contracts with any federal, state,
municipal or departmental or foreign court, arbitrator or administrative or
governmental authority, bureau or agency relating to compliance with matters
described in (ii) and (iii) above.
"Liabilities" shall have the meaning set forth in Section 4.20 of this
Agreement.
"Licenses" shall have the meaning set forth in Section 4.18 of this
Agreement.
"Material Adverse Effect" shall have the meaning set forth in Section
4.1 of this Agreement.
"Permits" shall mean any and all permits, authorizations, approvals,
registrations, waivers, variances and licenses (i) under any (x) Laws or (y)
Judgments with any federal, state, municipal or departmental court, arbitrator
or administrative or governmental authority, bureau or agency relating to
compliance with the matters described in (x) above or (ii) granted by any
federal, state, municipal or departmental administrative or governmental
authority, bureau or agency (whether domestic or foreign).
"Permitted Encumbrances" shall mean undetermined or inchoate liens
arising or potentially arising under statutory provisions which have not at the
time been filed and of which written notice has not been served pursuant to Laws
or which relate to obligations not overdue or delinquent, minor imperfections in
title, if any, not material in nature and which, individually and in the
aggregate, do not materially interfere with or affect the conduct of the
Companies' businesses.
"Person" shall mean any individual, partnership, joint venture, firm,
corporation, limited liability company, association, trust or other similar
entity or any government or political subdivision or any agency, department or
instrumentality thereof.
"Purchaser Share Limit" shall have the meaning set forth in Section 1.2
of this Agreement.
"Regulated Holder" means any holder of the Company's capital stock that
is regulated under the BHCA Rules.
"Regulatory Problem" means any transaction, circumstance or situation
whereby (i) Regulated Holder and its Affiliates would own, control or have power
over a greater quantity of securities of any kind issued by the Company or any
other entity than are permitted under any requirement of any governmental
authority, or would cause such Regulated Holder or any of its Affiliates to not
be able to hold an investment in or
22
27
provide financing to the Company in compliance with any applicable requirement
of any governmental authority, or (ii) it has been asserted by any governmental
regulatory agency (or any Regulated Holder believes that there is a risk of such
assertion) that such Regulated Holder and its Affiliates are not entitled to
hold the Shares held by such Regulated Holder and its Affiliate or exercise any
significant right with respect to the Shares held by such Person or provide
financing to the Company in compliance with any applicable requirement of any
governmental authority.
"Subsidiaries" or "Subsidiary" shall mean any subsidiary of the Company
over which the Company exercises control. For purposes of this definition,
"control" shall mean the direct or indirect ownership by the Company of 50% or
more of the voting securities of such subsidiary.
"Tax" and "Taxes" shall mean (i) all taxes, assessments, levies,
imports, duties, license fees, registration fees or other similar governmental
charges including, without limitation, income taxes, franchise taxes, transfer
taxes or fees, value added taxes, sales taxes, excise taxes, ad valorem taxes,
withholding taxes, minimum taxes and social security or other employee-related
taxes and (ii) any interest, penalties or additions to tax imposed on a tax
described in clause (i) hereof imposed by any federal, state, municipal,
departmental or foreign governmental agency or political subdivision.
"Transaction Documents" shall mean this Stock Purchase Agreement and
the Investors Agreement.
23
28
IN WITNESS WHEREOF, the parties hereto have executed this Follow-On
Series B/B-1 Preferred Stock Purchase Agreement as of the date set forth in the
first paragraph hereof.
COMPANY:
VELOCOM INC.
By:
----------------------------------
Name:
Title:
PURCHASERS:
BANKAMERICA INVESTMENT CORPORATION
By:
----------------------------------
Name:
Title:
XXXXXXXX XXXXXXXXXXXX
By:
----------------------------------
Name:
Title:
FIRST UNION INVESTORS, INC.
By:
----------------------------------
Name:
Title:
24
29
DOLPHIN COMMUNICATIONS FUND, L.P.
By: Dolphin Communications, L.P.
Its: General Partner
By: Dolphin Communications,
L.L.C.
Its: General Partner
By:
----------------------------------
Name: Xxxxx X. Xxxxxxx
Its: Member
DOLPHIN COMMUNICATIONS
PARALLEL FUND, L.P.
By: Dolphin Communications, L.P.
Its: General Partner
By: Dolphin Communications,
L.L.C.
Its: General Partner
By:
----------------------------------
Name: Xxxxx X. Xxxxxxx
Its: Member
NORTHWOOD VENTURES LLC.
By:
----------------------------------
Name:
Title:
TORONTO DOMINION INVESTMENTS, INC.
By:
----------------------------------
Name:
Title:
25
30
CRI MEDIA PARTNERS, L.P.
By:
----------------------------------
Name:
Title:
CRI MEDIA PARTNERS II, L.P.
By:
----------------------------------
Name:
Title:
CHESTNUT HILL VELOCOM, LLC.
By:
----------------------------------
Name:
Title:
TD SECURITIES (USA), INC.
By:
----------------------------------
Name:
Title:
----------------------------------
Xxxxx Xxxxxxxx
----------------------------------
Xxxxx X. Xxxxxxxx
----------------------------------
Xxxx Xxxxxx
26
31
FOLLOW-ON SERIES B/B-1 STOCK PURCHASE AGREEMENT
EXHIBIT A
SCHEDULE OF PURCHASERS
INITIAL CLOSING SUBSEQUENT CLOSINGS
SECOND CLOSING FINAL CLOSING
AGGREGATE AGGREGATE AGGREGATE
NUMBER OF PURCHASE NUMBER OF PURCHASE NUMBER OF PURCHASE
NAME AND ADDRESS SHARES PRICE SHARES PRICE SHARES PRICE
---------------- ------ --------- --------- --------- --------- ---------
BankAmerica Investment
Corporation
000 X. XxXxxxx Xxxxxx
Xxxxxxx, XX 00000 2,916,667(1) $17,500,002 1,458,333(2) $ 8,749,998 1,458,333 $ 8,749,998
Xxxxxxxx Xxxxxxxxxxxx
0000 Xxxxxxxxx Xxxxx
Xxx Xxxxx, XX 00000 1,250,000 $ 7,500,000 625,000 $ 3,750,000 625,000 $ 3,750,000
Chestnut Hill VeloCom, LLC
0000 Xxxxxxxx Xxxxxx
Xxxxxxxx Xxxx, XX 00000 1,725,000 $10,350,000 862,500 $ 5,175,000 862,500 $ 5,175,000
Dolphin Communications Fund, L.P.
000 Xxxxxxxxx Xxxxxx
00xx Xxxxx
Xxx Xxxx, XX 00000 293,140 $ 1,758,840 146,570 $ 879,420 146,570 $ 879,420
Dolphin Communications Parallel
Fund, L.P.
000 Xxxxxxxxx Xxxxxx
00xx Xxxxx
Xxx Xxxx, XX 00000 123,527 $ 741,162 61,763 $ 370,578 61,763 $ 370,578
First Union Investors, Inc.
c/o First Union Capital Partners
1 First Union Center
5th Floor
NC 0732
Xxxxxxxxx, XX 00000 1,595,489 $ 9,572,934 797,745(2) $ 4,786,470 797,745(2) $ 4,786,470
Toronto Dominion Investments,
Inc.
000 Xxxxxx, Xxxxx 0000
Xxxxxxx, XX 00000 583,333 $ 3,499,998 291,667 $ 1,750,002 291,667 $ 1,750,002
A-1
32
INITIAL CLOSING SUBSEQUENT CLOSINGS
SECOND CLOSING FINAL CLOSING
AGGREGATE AGGREGATE AGGREGATE
NUMBER OF PURCHASE NUMBER OF PURCHASE NUMBER OF PURCHASE
NAME AND ADDRESS SHARES PRICE SHARES PRICE SHARES PRICE
---------------- ------ --------- --------- --------- --------- ---------
CRI Media Partners, L.P.
000 Xxxxxxx Xxxxxx
00xx Xxxxx
Xxx Xxxx, XX 00000 13,333 $ 79,998 6,667 $ 40,002 6,667 $ 40,002
CRI Media Partners II, L.P.
000 Xxxxxxx Xxxxxx
00xx Xxxxx
Xxx Xxxx, XX 00000 53,333 $ 319,998 26,667 $ 160,002 26,667 $ 160,002
Northwood Ventures LLC
000 Xxxxxxxxx Xxxx
Xxxxxxx, XX 00000 125,000 $ 750,000 62,500 $ 375,000 62,500 $ 375,000
Xxxxx Xxxxxxxx
00000 XX Xxxxxxxxx Xxxxx
Xxxxxxxx, XX 00000 8,333 $ 49,998 4,167 $ 25,002 4,167 $ 25,002
Xxxxx X. Xxxxxxxx
0000 Xxxxxxxxx Xx
Xxxx Xxxx, XX 00000 5,000 $ 30,000 2,500 $ 15,000 2,500 $ 15,000
Xxxx Xxxxxx
000 Xxxxxxxxxx Xx
Xxxxx 0000
Xxx Xxxxxxxxx, XX 00000 6,250 $ 37,500 3,125 $ 18,750 3,125 $ 18,750
TD Securities (USA), Inc.
00 X. 00xx Xxxxxx
Xxx Xxxx, XX 00000 25,000 $ 150,000 12,500 $ 75,000 12,500 $ 75,000
TOTAL 8,723,405 $52,340,430 4,361,704 $26,170,224 4,361,704 $26,170,224
----------- ----------- ----------- ----------- ----------- -----------
----------------
(1) Of this amount, 948,913 shares shall be Series B Preferred Stock, and
1,967,754 shares shall be Series B-1 Preferred Stock.
(2) The Investor shall have the right to designate the number of these
shares that shall be Series B Preferred Stock and the number that shall
be Series B-1 Preferred Stock.
A-2
33
FOLLOW-ON SERIES B/B-1 STOCK PURCHASE AGREEMENT
EXHIBIT B
FORM OF SECOND AMENDED AND RESTATED CERTIFICATE OF INCORPORATION
B-1
34
SECOND AMENDED AND RESTATED CERTIFICATE OF INCORPORATION
OF
VELOCOM INC.
(Pursuant to Section 242 and Section 245)
VELOCOM INC., originally filed in the state of Delaware as WLL
International, Inc., hereby certifies as follows:
1. The name of the corporation is VELOCOM INC. (the "Corporation"). The
date of filing of its original Certificate of Incorporation with the Secretary
of State of the State of Delaware was April 29, 1998, and the Amended and
Restated Certificate of Incorporation was filed with the Delaware Secretary of
State on December 3, 1999.
2. This Second Amended & Restated Certificate of Incorporation restates and
amends the original Certificate of Incorporation, the Amended and Restated
Certificate of Incorporation and all amendments and certificates thereto.
3. This Second Amended & Restated Certificate of Incorporation (the
"Certificate of Incorporation") has been duly adopted in accordance with Section
242 and Section 245 of the Delaware General Corporation Law.
ARTICLE ONE.
The name of this corporation is VELOCOM INC.
ARTICLE TWO.
The address of the Corporation's registered office in the State of Delaware
is 0000 Xxxxxx Xxxx, Xxxx xx Xxxxxxxxxx, Xxxxxx of Xxx Xxxxxx, Xxxxxxxx 00000.
The name of its registered agent at such address is Corporation Service Company.
ARTICLE THREE.
The nature of the business or purposes to be conducted or promoted is to
engage in any lawful act or activity for which corporations may be organized
under the General Corporation Law of the State of Delaware.
ARTICLE FOUR.
SECTION 4.1 AUTHORIZED CAPITAL.
(a) The Corporation shall be authorized to issue two classes of
stock to be designated respectively "Common Stock" and "Preferred Stock." The
aggregate number of shares which the Corporation shall have the authority to
issue is one hundred eighty seven million two hundred sixty eight thousand eight
hundred forty two (187,268,842); the total number of shares of Common Stock
shall be one hundred eight
35
million six hundred thirty four thousand four hundred twenty one (108,634,421),
with a par value of $.0001 per share, and the total number of shares of
Preferred Stock shall be seventy eight million six hundred thirty four thousand
four hundred twenty one (78,634,421), with a par value of $.0001 per share. Such
Preferred Stock may be issued in series.
(b) Subject to the voting requirements set forth in Section
4.2(b)(iii), the Corporation's board of directors shall have the authority,
without stockholder action, to determine the preferences, limitations and
relative rights of any Preferred Stock (whether in a series or as a class),
including without limitation the following: (i) the designation of any series of
Preferred Stock; (ii) unlimited, special, conditional, or limited voting rights,
or no right to vote; except that no condition, limitation, or prohibition on
voting shall eliminate any right to vote provided by the Delaware General
Corporation Law; (iii) redemption rights; (iv) conversion rights, (v)
distribution or dividend rights, including the determination of whether such
rights are cumulative, non-cumulative or partially cumulative, and (vi)
preference rights over any other class or series of shares with respect to
distributions, including dividends and distributions upon the dissolution of the
Corporation.
(c) Common Stock shall be divided into one hundred six million
six hundred sixty six thousand six hundred sixty seven (106,666,667) shares of
voting common stock (the "Voting Common Stock") and one million nine hundred
sixty seven thousand seven hundred fifty four (1,967,754) shares of non-voting
Common Stock (the "Non-Voting Common Stock, and together, the "Common Stock").
Except as otherwise required by law, the Non-Voting Common Stock shall not be
entitled to vote on any matter on which the Stockholders of the Corporation
shall be entitled to vote; and shares of Non-Voting Common Stock shall not be
included in determining the number of shares voting or entitled to vote on any
such matters. Except for the difference in voting rights, both the Voting Common
Stock and the Non-Voting Common stock shall be identical in their rights.
SECTION 4.2 DESIGNATION OF PREFERRED STOCK.
Thirty one million (31,000,000) of the authorized shares of
Preferred Stock are hereby designated as "Series A Preferred Stock" (the "Series
A Preferred"), forty one million six hundred sixty six thousand six hundred
sixty seven (41,666,667) of the authorized shares of Preferred Stock are hereby
designated as "Series B Preferred Stock" (the "Series B Preferred") and one
million nine hundred sixty seven thousand seven hundred fifty four (1,967,754)
of the authorized shares of Preferred Stock are hereby designated as "Series B-1
Preferred Stock" (the "Series B-1 Preferred," and together with the Series B
Preferred, the "Series B/B-1 Preferred"). Except for the differences in voting
and conversion rights set forth herein, both the Series B Preferred and the
Series B-1 Preferred shall be identical in their rights. The Series A Preferred
and the Series B/B-1 Preferred are hereinafter collectively referred to as the
"Series Preferred." The rights, preferences, privileges, restrictions and other
matters relating to the Series Preferred are as follows:
2
36
(a) DIVIDEND RIGHTS.
(i) Declared Dividends. Holders of the Series Preferred, in
preference to the holders of Common Stock and any other stock of the Corporation
that is not by its terms expressly senior in right of payment to the Series
Preferred (collectively, "Junior Stock"), shall be entitled to receive
dividends, when and as declared by the board of directors, but only out of funds
that are legally available therefor. In addition, in the event that the
Corporation declares or pays any dividends upon the Common Stock (whether
payable in cash, securities or other property) other than dividends payable
solely in shares of Common Stock, the Corporation shall also declare and pay to
the holders of the Series Preferred at the same time that it declares and pays
such dividends to the holders of the Common Stock, the dividends which would
have been declared and paid with respect to the Common Stock issuable upon
conversion of the Series Preferred had all of the outstanding Series Preferred
been converted immediately prior to the record date for such dividend, or if no
record date is fixed, the date as of which the record holders of Common Stock
entitled to such dividends are to be determined. The Corporation shall not
declare dividends on one Series of Preferred Stock and not on each other Series
of Preferred Stock.
(ii) Preference. So long as any of the Series Preferred remains
outstanding, without the prior written consent of the holders of sixty-six and
two-thirds percent (66 2/3%) of the outstanding shares of the Series Preferred
(the "Required Holders"), the Corporation shall not, nor shall it permit any
Subsidiary to, redeem, purchase or otherwise acquire directly or indirectly any
Junior Stock, nor shall the Corporation directly or indirectly pay or declare
any dividend or make any distribution upon any Junior Stock. The provisions of
this Section 4.2(a)(ii) shall not, however, apply to (i) the acquisition of
shares of any Junior Stock in exchange for shares of any other Junior Stock,
(ii) the payment of cash dividends on the Common Stock to the extent that
equivalent dividends are paid on the Series Preferred as provided above, or
(iii) any repurchase of any Reserved Employee Stock from former employees,
directors or consultants in connection with termination of employment or service
as a director or consultant that is approved by the Corporation's board of
directors.
(b) VOTING RIGHTS.
(i) Generally. Except as otherwise provided herein or as required
by law, the Series Preferred shall vote with the shares of the Common Stock of
the Corporation (and not as a separate class) at any annual or special meeting
of stockholders of the Corporation, and may act by written consent in the same
manner as the Common Stock, in either case upon the following basis: each holder
of shares of the Series Preferred shall be entitled to such number of votes as
shall be equal to the whole number of shares of Common Stock into which such
holder's aggregate number of shares of the Series Preferred are convertible
(pursuant to Section 4.2(e) below) immediately after the close of business on
the record date fixed for such meeting or the effective date of such written
consent.
3
37
(ii) Except as specifically set forth in this Article Four, or as
otherwise required by law, each outstanding share of Series B-1 Preferred shall
not be entitled to vote on any matter on which the stockholders of the
Corporation shall be entitled to vote; and shares of Series B-1 Preferred shall
not be included in determining the number of shares voting or entitled to vote
on any such matters.
(iii) Class Vote Requirement. Without the affirmative vote of the
Required Holders, the Corporation shall not (i) create, issue or authorize the
issuance of any additional Common Stock or Preferred Stock or create or
authorize any new class or series of the Corporation's capital stock (except for
issuances of Reserved Employee Stock, issuances upon conversion of Preferred
Stock, and issuances in connection with strategic transactions involving the
Corporation and the non-affiliates of the Corporation approved by the
Corporation's board of directors, the primary purpose of which is other than to
raise funds for the Corporation (including (1) joint ventures, manufacturing,
marketing or distribution arrangements or (2) technology transfer or development
arrangements)); (ii) amend this Certificate of Incorporation or the
Corporation's Bylaws; (iii) engage in (1) any merger, consolidation, business
combination, recapitalization, or reorganization in which (A) the stockholders
of the Corporation immediately prior to such transaction own capital stock
representing less than seventy percent (70%) of the surviving company's voting
power in the election of directors immediately after such transaction or (B) the
stockholders of the Corporation immediately prior to such transaction do not own
substantially the same proportion of capital stock of the surviving company
after the transaction as they owned of the Corporation immediately prior to the
transaction (a "Disproportionate Change"); provided, however, that any change in
a stockholder's ownership percentage of less than ten percentage points shall
not be deemed to be a Disproportionate Change, (2) a liquidation or sale of
substantially all of the assets by the Corporation or any of its subsidiaries
outside the ordinary course of business, or (3) a purchase of substantial assets
by the Corporation or any of its subsidiaries outside the ordinary course of
business; (iv) engage in any business other than telecommunications and
multimedia communications services, including but not limited to data, voice or
video transmission, cable, IP telephony, MMDS, Internet access or any other
telecommunications service using wireless, wireline, fiber, LMDS or broadband
access or any other technology, and also including any Internet content
business; (v) increase the amount of Reserved Employee Stock above twelve
percent (12%) of the Corporation's Common Stock Deemed Outstanding; or (vi)
engage in any transaction with an affiliate of the Corporation, except for
transactions involving wholly-owned subsidiaries, that is not approved by a
majority of the Corporation's disinterested directors.
(c) LIQUIDATION RIGHTS.
(i) Liquidation Value. Upon any liquidation, dissolution or
winding up of the Corporation, whether voluntary or involuntary, before any
distribution or payment shall be made to the holders of any Junior Stock or
Common Stock, (i) first, the holders of the Series B/B-1 Preferred shall be
entitled to be paid out of the assets of the Corporation an amount with respect
to each share of the Series B/B-1 Preferred
4
38
equal to the sum of (A) the Original Series B/B-1 Issue Price (as defined below)
plus (B) all declared but unpaid dividends thereon (the "Series B/B-1
Liquidation Value") and (ii) second, after the payment of the full liquidation
preference of the Series B/B-1 Preferred, the holders of the Series A Preferred
shall be entitled to be paid out of the assets of the Corporation an amount with
respect to each share of the Series A Preferred equal to the sum of (A) the
Original Series A Issue Price (as defined below), plus (B) all declared but
unpaid dividends thereon (the "Series A Liquidation Value"). The "Original
Series A Issue Price" shall be Three Dollars ($3.00) per share, as appropriately
adjusted for any future stock splits, stock combinations, stock dividends or
similar transactions affecting the Series A Preferred. The "Original Series
B/B-1 Issue Price" shall be Six Dollars ($6.00) per share, as appropriately
adjusted for any future stock splits, stock combinations, stock dividends or
similar transactions affecting the Series B/B-1 Preferred.
(ii) Participation. After the payment of the full liquidation
preference of the Series Preferred as set forth in Section 4.2(c)(i) above, the
remaining assets of the Corporation legally available for distribution, if any,
shall be distributed to the holders of Junior Stock entitled to a preference
over the Common Stock and, thereafter, to the holders of Common Stock. The
holders of the Series Preferred shall be entitled to participate in
distributions to holders of the Common Stock such that, giving effect to all
distributions pursuant to Section 4.2(c)(i), the holders of the Series Preferred
receive aggregate distributions equal to the greater of (A) the Series A
Liquidation Value (in the case of the Series A Preferred) or the Series B/B-1
Liquidation Value (in the case of the Series B/B-1 Preferred), or (B) the
amounts that such holders would have received if the Series Preferred had been
converted into Common Stock immediately prior to such liquidation, dissolution
or winding up of the Corporation.
(iii) Liquidation Events. At the option of the Required Holders,
the following events shall be considered a liquidation for purposes of Section
4.2(c).
(A) any (1) merger, consolidation, business combination,
reorganization or recapitalization of the Corporation that involves a
Disproportionate Change; provided, however, that any change in a stockholder's
ownership percentage of less than ten percentage points shall not be deemed to
be a Disproportionate Change; or (2) transaction or series of related
transactions in which capital stock representing in excess of thirty percent
(30%) of the Corporation's voting power in electing the board of directors is
transferred (an "Acquisition"); or
(B) a sale, lease or other disposition of all or
substantially all of the assets of the Corporation (an "Asset Transfer").
(iv) Proportionate Payments. If, upon any liquidation,
dissolution or winding up, the assets of the Corporation shall be insufficient
to make payment in full to all holders of the Series Preferred, then such assets
shall be distributed first, among the holders of the Series B/B-1 Preferred at
the time outstanding, ratably in proportion to the full amounts to which they
would otherwise be
5
39
entitled and second, any remaining assets shall be distributed among the holders
of the Series A Preferred at the time outstanding, ratably in proportion to the
full amounts to which they would otherwise be entitled.
(d) REDEMPTION RIGHTS.
(i) Scheduled Redemptions. Unless a holder of Series Preferred
elects otherwise in accordance with Section 4.2(d)(iii) below, on January 26,
2005, the Corporation shall redeem thirty three and one-third percent (33 1/3%)
of the then-outstanding shares of each of the Series A Preferred and the Series
B/B-1 Preferred held by such holder; on January 26, 2006, the Corporation shall
redeem fifty percent (50%) of the then-outstanding shares of each of the Series
A Preferred and the Series B/B-1 Preferred held by such holder; and shall redeem
all remaining shares of the Series A Preferred and the Series B/B-1 Preferred
held by such holder on January 26, 2007 (the "Scheduled Redemption Dates"), at a
price per share equal to the Series A Liquidation Value or the Series B/B-1
Liquidation Value, respectively.
(ii) Redemption Payments. For each share of the Series Preferred
which is to be redeemed hereunder, the Corporation shall be obligated on the
Scheduled Redemption Date to pay to the holder thereof (upon surrender by such
holder at the Corporation's principal office of the certificate representing
such share) an amount in cash equal to the Series A Liquidation Value or the
Series B/B-1 Liquidation Value, as applicable. If the funds of the Corporation
legally available for redemption of the Series Preferred on any Scheduled
Redemption Date are insufficient to redeem the total number of shares to be
redeemed on such date, those funds which are legally available shall be used to
redeem the maximum possible number of shares pro rata among the holders of the
Series Preferred to be redeemed based upon the aggregate Liquidation Value of
such shares of the Series Preferred held by each such holder. At any time
thereafter when additional funds of the Corporation are legally available for
the redemption of the Series Preferred, such funds shall immediately be used to
redeem the balance of the shares which the Corporation has become obligated to
redeem on any Scheduled Redemption Date but which it has not redeemed.
(iii) Notice of Redemption. Except as otherwise provided herein,
the Corporation shall mail written notice of each redemption of the Series
Preferred to each record holder thereof not more than 60 nor less than 30 days
prior to the Scheduled Redemption Date (the "Corporation's Notice"). Any holder
of the Series Preferred may elect not to participate in the redemption on any
Scheduled Redemption Date by providing written notice to the Corporation of its
election not to have its shares of Preferred Stock redeemed within 10 days after
receipt of the Corporation's Notice. The holders of the Series Preferred to be
redeemed shall in any event have the right to convert any or all of their shares
into Common Stock at any time prior to the close of business on any Scheduled
Redemption Date. In case fewer than the total number of shares represented by
any certificate are redeemed, a new certificate representing the number of
unredeemed shares shall be issued to the holder thereof without cost to such
6
40
holder within five business days after surrender of the certificate representing
the redeemed shares.
(iv) Other Redemptions or Acquisitions. The Corporation shall not,
nor shall it permit any Subsidiary to, redeem or otherwise acquire any shares of
the Series Preferred, except as expressly authorized herein or pursuant to a
purchase offer made pro rata to all holders of the Series Preferred on the basis
of the aggregate Liquidation Value of the shares of the Series Preferred owned
by each such holder. If the assets of the Corporation shall be insufficient to
make payment in full to all holders whose shares of Series Preferred are being
redeemed or otherwise acquired, such assets shall be used first to redeem shares
of Series B/B-1 Preferred, ratably in proportion to the redemption price for the
shares that such holders otherwise would have been entitled to redeem, and
second, any remaining assets shall be used to redeem shares of Series A
Preferred, ratably in proportion to the redemption price for the shares that
such holders otherwise would have been entitled to redeem.
(e) CONVERSION RIGHTS - CONVERSION OF SERIES PREFERRED INTO COMMON
STOCK.
The holders of the Series Preferred shall have the following rights with
respect to the conversion of the Series Preferred into shares of Common Stock:
(i) Optional Conversion into Common Stock. Subject to and in
compliance with the provisions of this Section 4.2(e), any shares of the Series
Preferred may, at the option of the holder, be converted at any time into
fully-paid and nonassessable shares of Common Stock (either Voting Common Stock,
in the case of Series A Preferred or Series B Preferred, or Non-Voting Common
Stock, in the case of Series B-1 Preferred). The number of shares of Common
Stock to which a holder of the Series A Preferred shall be entitled upon
conversion shall be the product obtained by multiplying the "Series A Conversion
Rate" then in effect (determined as provided in Section 4.2(e)(ii)) by the
number of shares of the Series A Preferred being converted. The number of shares
of Common Stock to which a holder of the Series B/B-1 Preferred shall be
entitled upon conversion shall be the product obtained by multiplying the
"Series B/B-1 Conversion Rate" then in effect (determined as provided in Section
4.2(e)(ii)) by the number of shares of the Series B/B-1 Preferred being
converted.
(ii) Series Conversion Rate. The conversion rate in effect at any
time for conversion of the Series A Preferred (the "Series A Conversion Rate")
shall be the quotient obtained by dividing the Series A Liquidation Value by the
"Series A Conversion Price" calculated as provided in Section 4.2(e)(iii). The
conversion rate in effect at any time for conversion of the Series B/B-1
Preferred (the "Series B/B-1 Conversion Rate") shall be the quotient obtained by
dividing the Series B/B-1 Liquidation Value by the "Series B/B-1 Conversion
Price" calculated as provided in Section 4.2(e)(iii).
7
41
(iii) Conversion Price. The conversion price for the Series A
Preferred (the "Series A Conversion Price") shall initially be the Original
Series A Issue Price (i.e., $3.00). Such initial Series A Conversion Price shall
be adjusted from time to time in accordance with this Section 4.2(e). If and
whenever on or after the first date of issuance of any shares of Series A
Preferred (the "Original Series A Issue Date") the Corporation issues or sells,
or in accordance with this Section 4.2(e)(iii) is deemed to have issued or sold,
any shares of its Common Stock (other than pursuant to a Permitted Issuance) for
a consideration per share less than the Series A Conversion Price in effect
immediately prior to the time of such issue or sale, then immediately upon such
issue or sale or deemed issue or sale the Series A Conversion Price shall be
reduced to the amount determined by dividing (a) the sum of (1) the product
derived by multiplying the Series A Conversion Price in effect immediately prior
to such issue or sale by the number of shares of Common Stock Deemed Outstanding
immediately prior to such issue or sale, plus (2) the consideration, if any,
received or deemed to have been received by the Corporation upon such issue or
sale, by (b) the number of shares of Common Stock Deemed Outstanding immediately
after such issue or sale. All references to the Series A Conversion Price herein
shall mean the Series A Conversion Price as so adjusted.
The conversion price for the Series B/B-1 Preferred (the "Series B/B-1
Conversion Price") shall initially be the Original Series B/B-1 Issue Price
(i.e., $6.00). Such initial Series B/B-1 Conversion Price shall be adjusted from
time to time in accordance with this Section 4.2(e). Except with respect to
Defaulting Purchasers (as defined in Section 4.2 (e)(ix) below) for whom the
Series B/B-1 Conversion Price shall be as set forth in Section 4.2(e)(ix) below,
if and whenever on or after the first date of issuance of any shares of Series
B/B-1 Preferred (the "Original Series B/B-1 Issue Date") the Corporation issues
or sells, or in accordance with this Section 4.2(e)(iii) is deemed to have
issued or sold, any shares of its Common Stock (other than pursuant to a
Permitted Issuance) for a consideration per share less than the Series B/B-1
Conversion Price in effect immediately prior to the time of such issue or sale,
then immediately upon such issue or sale or deemed issue or sale the Series
B/B-1 Conversion Price shall be reduced to the amount determined by dividing (a)
the sum of (1) the product derived by multiplying the Series B/B-1 Conversion
Price in effect immediately prior to such issue or sale by the number of shares
of Common Stock Deemed Outstanding immediately prior to such issue or sale, plus
(2) the consideration, if any, received or deemed to have been received by the
Corporation upon such issue or sale, by (b) the number of shares of Common Stock
Deemed Outstanding immediately after such issue or sale. All references to the
Series B/B-1 Conversion Price herein shall mean the Series B/B-1 Conversion
Price as adjusted pursuant to this Section 4.2(e)(iii) and Section 4.2 (e)(ix)
below.
For purposes of determining the adjusted Series A Conversion Price for any
holder of Series Preferred and/or the adjusted Series B/B-1 Conversion Price for
any holder of Series Preferred except for a Defaulting Purchaser, the following
shall be applicable:
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(A) Issuance of Rights or Options. Except for Permitted
Issuances, if the Corporation in any manner grants or sells any Options and the
price per share for which Common Stock is issuable upon the exercise of such
Options, or upon conversion or exchange of any Convertible Securities issuable
upon exercise of such Options, is less than the Series A Conversion Price and/or
the Series B/B-1 Conversion Price, as the case may be, in effect immediately
prior to the time of the granting or sale of such Options, then the total
maximum number of shares of Common Stock issuable upon the exercise of such
Options or upon conversion or exchange of the total maximum amount of such
Convertible Securities issuable upon the exercise of such Options shall be
deemed to have been issued and sold by the Corporation at the time of the
granting or sale of such Options for such price per share. For purposes of this
paragraph, the "price per share for which Common Stock is issuable" shall be
determined by dividing (1) the total amount, if any, received or receivable by
the Corporation as consideration for the granting or sale of such Options, plus
the minimum aggregate amount of additional consideration payable to the
Corporation upon exercise of all such Options, plus in the case of such Options
which relate to Convertible Securities, the minimum aggregate amount of
additional consideration, if any, payable to the Corporation upon the issuance
or sale of such Convertible Securities and the conversion or exchange thereof,
by (2) the total maximum number of shares of Common Stock issuable upon the
exercise of such Options or upon the conversion or exchange of all such
Convertible Securities issuable upon the exercise of such Options. No further
adjustment of the Series A Conversion Price and/or the Series B/B-1 Conversion
Price shall be made when Convertible Securities are actually issued upon the
exercise of such Options or when Common Stock is actually issued upon the
exercise of such Options or the conversion or exchange of such Convertible
Securities.
(B) Issuance of Convertible Securities. If the Corporation
in any manner issues or sells any Convertible Securities and the price per share
for which Common Stock is issuable upon conversion or exchange thereof is less
than the Series A Conversion Price and/or the Series B/B-1 Conversion Price, as
the case may be, in effect immediately prior to the time of such issue or sale,
then the maximum number of shares of Common Stock issuable upon conversion or
exchange of such Convertible Securities shall be deemed to have been issued and
sold by the Corporation at the time of the issuance or sale of such Convertible
Securities for such price per share. For the purposes of this paragraph, the
"price per share for which Common Stock is issuable" shall be determined by
dividing (1) the total amount received or receivable by the Corporation as
consideration for the issue or sale of such Convertible Securities, plus the
minimum aggregate amount of additional consideration, if any, payable to the
Corporation upon the conversion or exchange thereof, by (2) the total maximum
number of shares of Common Stock issuable upon the conversion or exchange of all
such Convertible Securities. No further adjustment of the Series A Conversion
Price and/or the Series B/B-1 Conversion Price, as the case may be, shall be
made when Common Stock is actually issued upon the conversion or exchange of
such Convertible Securities, and if any such issue or sale of such Convertible
Securities is made upon exercise of any Options for which adjustments of the
Series A Conversion Price and/or
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43
the Series B/B-1 Conversion Price had been or are to be made pursuant to other
provisions of this Section 4.2(e), no further adjustment of the Series A
Conversion Price and/or the Series B/B-1 Conversion Price shall be made by
reason of such issue or sale.
(C) Change in Option Price or Conversion Rate. If the
purchase price provided for in any Options, the additional consideration, if
any, payable upon the conversion or exchange of any Convertible Securities or
the rate at which any Convertible Securities are convertible into or
exchangeable for Common Stock changes at any time, the Series A Conversion Price
and/or the Series B/B-1 Conversion Price, as the case may be, in effect at the
time of such change shall be immediately adjusted to the Series A Conversion
Price and/or the Series B/B-1 Conversion Price which would have been in effect
at such time had such Options or Convertible Securities still outstanding
provided for such changed purchase price, additional consideration or conversion
rate, as the case may be, at the time initially granted, issued or sold.
(D) Treatment of Expired Options and Unexercised Convertible
Securities. Upon the expiration of any Option or the termination of any right to
convert or exchange any Convertible Security without the exercise of any such
Option or right, the Series A Conversion Price and/or the Series B/B-1
Conversion Price then in effect hereunder shall be adjusted immediately to the
Series A Conversion Price and/or the Series B/B-1 Conversion Price which would
have been in effect at the time of such expiration or termination had such
Option or Convertible Security, to the extent outstanding immediately prior to
such expiration or termination, never been issued.
(E) Calculation of Consideration Received. If any Common
Stock, Option or Convertible Security is issued or sold or deemed to have been
issued or sold for cash, the consideration received therefor shall be deemed to
be the amount received by the Corporation therefor (net of discounts,
commissions and related expenses). If any Common Stock, Option or Convertible
Security is issued or sold for a consideration other than cash, the amount of
the consideration other than cash received by the Corporation shall be the fair
value of such consideration. If any Common Stock, Option or Convertible Security
is issued to the owners of the non-surviving entity in connection with any
merger in which the Corporation is the surviving corporation, the amount of
consideration therefor shall be deemed to be the fair value of such portion of
the net assets and business of the non-surviving entity as is attributable to
such Common Stock, Option or Convertible Security, as the case may be. The fair
value of any consideration other than cash and securities shall be determined
jointly by the Corporation and the Required Holders. If such parties are unable
to reach agreement within a reasonable period of time, the fair value of such
consideration shall be determined by an independent appraiser experienced in
valuing such type of consideration jointly selected by the Corporation and the
Required Holders. The determination of such appraiser shall be final and binding
upon the parties, and the fees and expenses of such appraiser shall be borne by
the Corporation.
(F) Integrated Transactions. In case any Option is issued in
connection with the issue or sale of other securities of the Corporation,
together
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44
comprising one integrated transaction in which no specific consideration is
allocated to such Option by the parties thereto, the Option shall be deemed to
have been issued for a consideration of $.01.
(G) Treasury Shares. The number of shares of Common Stock
outstanding at any given time shall not include shares owned or held by or for
the account of the Corporation or any Subsidiary, and the disposition of any
shares so owned or held shall be considered an issue or sale of Common Stock.
(iv) Adjustment for Stock Splits and Combinations. If the
Corporation shall at any time or from time to time effect a subdivision of the
outstanding Common Stock, the Series A Conversion Price and the Series B/B-1
Conversion Price in effect immediately before that subdivision shall be
proportionately decreased. Conversely, if the Corporation shall at any time or
from time to time combine the outstanding shares of Common Stock into a smaller
number of shares, the Series A Conversion Price and the Series B/B-1 Conversion
Price in effect immediately before the combination shall be proportionately
increased. Any adjustment under this Section 4.2(e)(iv) shall become effective
at the close of business on the date the subdivision or combination becomes
effective.
(v) Adjustment for Common Stock Dividends and Distributions. If
the Corporation at any time or from time to time makes, or fixes a record date
for the determination of holders of Common Stock entitled to receive, a divided
or other distribution payable in additional shares of Common Stock, in each such
event the Series A Conversion Price and the Series B/B-1 Conversion Price that
is then in effect shall be decreased as of the time of such issuance or, in the
event such record date is fixed, as of the close of business on such record
date, by multiplying each of the Series A Conversion Price and the Series B/B-1
Conversion Price then in effect by a fraction (1) the numerator of which is the
total number of shares of Common Stock issued and outstanding immediately prior
to the time of such issuance or the close of business on such record date, and
(2) the denominator of which is the total number of shares of Common Stock
issued and outstanding immediately prior to the time of such issuance or the
close of business on such record date plus the number of shares of Common Stock
issuable in payment of such dividend or distribution; provided, however, that if
such record date is fixed and such dividend is not fully paid or if such
distribution is not fully made on the date fixed therefor, the Series A
Conversion Price and the Series B/B-1 Conversion Price shall be recomputed
accordingly as of the close of business on such record date and thereafter the
Series A Conversion Price and the Series B/B-1 Conversion Price shall be
adjusted pursuant to this Section 4.2(e)(v) to reflect the actual payment of
such dividend or distribution.
(vi) Adjustments for Other Dividends and Distributions. If the
Corporation at any time or from time to time makes, or fixes a record date for
the determination of holders of Common Stock entitled to receive, a dividend or
other distribution payable in securities of the Corporation other than shares of
Common Stock, in each such event provision shall be made so that the holders of
the Series Preferred
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45
shall receive upon conversion thereof, in addition to the number of shares of
Common Stock receivable thereupon, the amount of other securities of the
Corporation which they would have received had their Series Preferred been
converted into Common Stock on the date of such event and had they thereafter,
during the period from the date of such event to and including the conversion
date, retained such securities receivable by them as aforesaid during such
period, subject to all other adjustments called for during such period under
this Section 4.2(e) with respect to the rights of the holders of the Series
Preferred or with respect to such other securities by their terms.
(vii) Adjustment for Reclassification, Exchange and Substitution.
If at any time or from time to time the Common Stock issuable upon the
conversion of the Series Preferred is changed into the same or a different
number of shares of any class or classes of stock, whether by recapitalization,
reclassification or otherwise (other than a subdivision or combination of shares
or stock dividend or a reorganization, merger, consolidation or sale of assets
provided for elsewhere in this Section 4.2), in any such event each holder of
the Series Preferred shall have the right thereafter to convert such stock into
the kind and amount of stock and other securities and property receivable in
connection with such recapitalization, reclassification or other change by
holders of the maximum number of shares of Common Stock into which such shares
of the Series Preferred could have been converted immediately prior to such
recapitalization, reclassification or change, all subject to further adjustments
as provided herein or with respect to such other securities or property by the
terms thereof.
(viii) Reorganizations, Mergers, Consolidations or Sales of
Assets. If at any time or from time to time there is a capital reorganization of
the Common Stock (other than a recapitalization, subdivision, combination,
reclassification, exchange or substitution of shares provided for elsewhere in
this Section 4.2), as a part of such capital reorganization, provision shall be
made so that the holders of the Series Preferred shall thereafter be entitled to
receive upon conversion of the Series Preferred the number of shares of stock or
other securities or property of the Corporation to which a holder of the maximum
number of shares of Common Stock deliverable upon conversion would have been
entitled in connection with such capital reorganization, subject to adjustment
in respect of such stock or securities by the terms thereof. In any such case,
appropriate adjustment shall be made in the application of the provisions of
this Section 4.2(e) with respect to the rights of the holders of the Series
Preferred after the capital reorganization to the end that the provisions of
this Section 4.2 (including adjustment of the Series A Conversion Price and the
Series B/B-1 Conversion Price then in effect and the number of shares of Common
Stock issuable upon conversion of the Series Preferred) shall be applicable
after that event and be as nearly equivalent as practicable.
(ix) Adjustment upon Default under Stock Purchase Agreements.
With respect to the shares of Series B/B-1 Preferred owned by a Defaulting
Purchaser who has not Cured such Default within a 10-day cure period, (as such
terms are defined in Amendment No. 1 to Series B Preferred Stock Purchase
Agreement dated as of December 31, 1999, and in Article 3 of the Follow-On
Series B/B-1 Preferred
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46
Stock Purchase Agreement dated December 20, 1999, in each case among the
Corporation and certain purchasers of the Corporation's Series B/B-1 Preferred
(collectively, the "Stock Purchase Agreements")), immediately upon the
expiration of such 10-day cure period, the Series B/B-1 Conversion Price for
such shares in effect immediately prior to such Default shall be increased to an
amount equal to two (2) times the Original Series B/B-1 Issue Price. Once the
Series B/B-1 Conversion Price for such shares of Series B/B-1 Preferred held by
the Defaulting Purchaser is adjusted in accordance with this Section 4.2(e)(ix),
it shall no longer be subject to any other adjustment provided in Section
4.2(e)(iii) of this Certificate of Incorporation. This Section 4.2(e)(ix) shall
not affect the Series B/B-1 Conversion Price for any holder of Series B/B-1
Preferred other than the Defaulting Purchaser, shall not affect the Series A
Conversion Price for shares of Series A Preferred held by the Defaulting
Purchaser, and shall not affect the Series B/B-1 Liquidation Value for any
holder of Series B/B-1 Preferred.
(x) Certificate of Adjustment. In each case of an adjustment or
readjustment of the Series A Conversion Price and/or the Series B/B-1 Conversion
Price for the number of shares of Common Stock or other securities issuable upon
conversion of the Series Preferred, the Corporation, at its expense, shall
compute such adjustment or readjustment in accordance with the provisions hereof
and prepare a certificate showing such adjustment or readjustment, and shall
mail such certificate, by first class mail, postage prepaid, to each registered
holder of the Series Preferred at the holder's address as shown in the
Corporation's books. The certificate shall set forth such adjustment or
readjustment, showing in detail the facts upon which such adjustment or
readjustment is based, including a statement of (1) the consideration received
or deemed to be received by the Corporation for any additional shares of Common
Stock issued or sold or deemed to have been issued or sold, (2) the Series A
Conversion Price and/or the Series B/B-1 Conversion Price at the time in effect,
(3) the number of additional shares of Common Stock issued or sold or deemed to
have been issued or sold, and (4) the type and amount, if any, of other property
which at the time would be received upon conversion of the Series Preferred.
(xi) Notices of Record Date. Upon (i) any taking by the
Corporation of a record of the holders of any class of securities for the
purpose of determining the holders thereof who are entitled to receive any
dividend or other distribution, or (ii) any Acquisition (as defined in Section
4.2(c)(iii)(A)) or other capital reorganization of the Corporation, any
reclassification or recapitalization of the capital stock of the Corporation,
any merger or consolidation of the Corporation with or into any other
corporation, any Asset Transfer (as defined in Section 4.2(c)(iii)(B)), or any
voluntary or involuntary dissolution, liquidation or winding up of the
Corporation, the Corporation shall mail to each holder of the Series Preferred
at least twenty (20) days prior to the record date specified therein a notice
specifying (1) the date on which any such record is to be taken for the purpose
of such dividend or distribution and a description of such dividend or
distribution, (2) the date on which any such Acquisition, reorganization,
reclassification, transfer, consolidation, merger, Asset Transfer, dissolution,
liquidation or winding up is expected to become effective, and (3) the date,
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47
if any, that is to be fixed for determining the holders of record of Common
Stock (or other securities) that shall be entitled to exchange their shares of
Common Stock (or other securities) for securities or other property deliverable
upon such Acquisition, reorganization, reclassification, transfer,
consolidation, merger, Asset Transfer, dissolution, liquidation or winding up.
(xii) Automatic Conversion into Common Stock. Each share of the
Series Preferred shall automatically be converted into shares of Common Stock
(Voting Common Stock in the case of Series A Preferred and Series B Preferred,
and Non-Voting Common Stock in the case of Series B-1 Preferred), based on the
then-effective Series A Conversion Price and/or the Series B/B-1 Conversion
Price, as the case may be, immediately upon the closing of a firmly underwritten
public offering pursuant to an effective registration statement under the
Securities Act of 1933, as amended, covering the offer and sale of Common Stock
for the account of the Corporation in which (i) the per share price to the
public is at least $15.00 per share (as adjusted for stock splits,
recapitalizations and the like), and (ii) the gross cash proceeds to the
Corporation (prior to expenses and underwriting commissions) are at least
$50,000,000. Upon such automatic conversion, all declared but unpaid dividends,
if any, shall be paid in accordance with Section 4.2(a).
(xiii) Mechanics of Conversion.
(A) Optional Conversion. Each holder of the Series Preferred
who desires to convert the same into shares of Common Stock pursuant to this
Section 4.2(e) shall surrender the certificate or certificates therefor, duly
endorsed, at the office of the Corporation or any transfer agent for the Series
Preferred, and shall give written notice to the Corporation at such office that
such holder elects to convert the same. Such notice shall state the number of
shares of the Series Preferred being converted. Thereupon, the Corporation shall
promptly issue and deliver at such office to such holder a certificate or
certificates for the number of shares of Common Stock to which such holder is
entitled and shall promptly pay in cash or, to the extent sufficient funds are
not then legally available therefor, in Common Stock (at the Common Stock's fair
market value determined by the Corporation's board of directors as of the date
of such conversion), any declared but unpaid dividends on the shares of the
Series Preferred being converted. Such conversion shall be deemed to have been
made at the close of business on the date of such surrender of the certificate
representing the shares of the Series Preferred to be converted, and the person
entitled to receive the shares of Common Stock issuable upon such conversion
shall be treated for all purposes as the record holder of such shares of Common
Stock on such date.
(B) Automatic Conversion. Upon the occurrence of the event
specified in Section 4.2(e)(xii) above, the outstanding shares of the Series
Preferred shall be converted into Common Stock (Voting Common Stock in the case
of Series A Preferred and Series B Preferred, and Non-Voting Common Stock in the
case of Series B-1 Preferred) automatically without any further action by the
holders of such shares and whether or not the certificates representing such
shares are surrendered to the
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48
Corporation or its transfer agent; provided, however, that the Corporation shall
not be obligated to issue certificates evidencing the shares of Common Stock
issuable upon such conversion unless the certificates evidencing such shares of
the Series Preferred are either delivered to the Corporation or its transfer
agent as provided below, or the holder notifies the Corporation or its transfer
agent that such certificates have been lost, stolen or destroyed and executes an
agreement satisfactory to the Corporation to indemnify the Corporation from any
loss incurred by it in connection with such certificates. Upon surrender by any
holder of the certificates formerly representing shares of the Series Preferred
at the office of the Corporation or any transfer agent for the Series Preferred,
there shall be issued and delivered to such holder promptly at such office and
in its name as shown on such surrendered certificate or certificates, a
certificate or certificates for the number of shares of Common Stock into which
the shares of the Series Preferred surrendered were convertible on the date on
which such automatic conversion occurred, and the Corporation shall promptly pay
in cash or, at the option of the Corporation, Common Stock (at the Common
Stock's fair market value determined by the Corporation's board of directors as
of the date of such conversion) or, at the option of the Corporation, a
combination of both, all declared but unpaid dividends on the shares of the
Series Preferred being converted. Until surrendered as provided above, each
certificate formerly representing shares of the Series Preferred shall be deemed
for all corporate purposes to represent the number of shares of Common Stock
resulting from such automatic conversion.
(xiv) Fractional Shares. No fractional shares of Common Stock
shall be issued upon conversion of the Series Preferred. All shares of Common
Stock (including fractions thereof) issuable upon conversion of more than one
share of the Series Preferred by a holder thereof shall be aggregated for
purposes of determination whether the conversion would result in the issuance of
any fractional share. If, after the aforementioned aggregation, the conversion
would result in the issuance of any fractional share, the Corporation shall, in
lieu of issuing any fractional share, pay cash equal to the product of such
fraction multiplied by the Common Stock's fair market value (as determined by
the Corporation's board of directors) on the date of conversion.
(f) CONVERSION RIGHTS - CONVERSION OF SERIES B PREFERRED INTO SERIES
B-1 PREFERRED OR VICE-VERSA.
The holders of Series B/B-1 Preferred shall have the following rights with
respect to the conversion of Series B Preferred into Series B-1 Preferred or
vice-versa:
(i) Conversion of Series B Preferred into Series B-1 Preferred.
At any Regulated Holder's request at any time (whether in connection with any
action by the Corporation referred to in Section 4.2(f)(ii)(B) or otherwise),
such Regulated Holder shall have the right, upon the occurrence or possible
occurrence of a Regulatory Problem, to convert any number of shares of Series B
Preferred then held by such Regulated Holder into an equal number of shares of
Series B-1 Preferred.
(ii) Conversion of Series B-1 Preferred into Series B Preferred.
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(A) In connection with the occurrence (or the expected
occurrence as described in Section 4.2(f)(ii)(C) below) of any Conversion Event,
each holder of Series B-1 Preferred shall be entitled to convert into an equal
number of Series B Preferred all of such holder's Series B-1 Preferred being (or
expected to be) distributed, disposed of or sold in connection with such
Conversion Event.
(B) A "Conversion Event" shall mean (i) any public offering
or public sale of securities of the Corporation (including a public offering
registered under the Securities Act and a public sale pursuant to Rule 144 of
the Securities Exchange Commission or any similar rule then in force), (ii) any
sale of securities of the Corporation to a person or group of persons (within
the meaning of the U.S. Securities Exchange Act of 1934, as amended (the "1934
Act")) if, after such sale, such person or group of persons in the aggregate
would own or control securities which possess in the aggregate the ordinary
power to elect a majority of the Corporation's board of directors (provided that
such sale has been approved by the Corporation's board of directors or a
committee thereof), (iii) any sale of securities of the Corporation to a person
or group of persons (within the meaning of the 0000 Xxx) if, after such sale,
such person or group of persons in the aggregate would own or control securities
of the Corporation (excluding any Series B-1 Preferred being converted and
disposed of in connection with such Conversion Event) which possesses in the
aggregate the ordinary power to elect a majority of the Corporation's board of
directors, (iv) any sale of securities of the Corporation to a person or group
of persons (within the meaning of the 0000 Xxx) if, after such sale, such person
or group of persons would not, in the aggregate, own, control or have the right
to acquire more than two percent (2%) of the outstanding securities of any class
of voting securities of the Corporation, and (v) a merger, consolidation or
similar transaction involving the Corporation if, after such transaction, a
person or group of persons (within the meaning of the 0000 Xxx) in the aggregate
would own or control securities which possess in the aggregate the ordinary
voting power to elect a majority of the surviving company's directors (provided
that the transaction has been approved by the Corporation's board of directors
or a committee thereof).
(C) Each Regulated Holder holding Series B-1 Preferred shall
be entitled to convert Series B-1 Preferred in connection with any Conversion
Event if such Regulated Holder reasonably believes that such Conversion Event
shall be consummated, and a written request for conversion from any Regulated
Holder holding Series B-1 Preferred to the Corporation shall obligate the
Corporation to effect such conversion in a timely manner so as to enable each
such Regulated Holder to participate in such Conversion Event. The Corporation
shall not cancel the Series B-1 Preferred so converted before the tenth day
following such Conversion Event and shall reserve such Series B-1 Preferred
until such tenth day for reissuance in compliance with the next sentence. If any
Series B-1 Preferred are converted into Series B Preferred in connection with a
Conversion Event and such Series B Preferred are not actually distributed,
disposed of or sold pursuant to such Conversion Event, such Series B Preferred
shall be promptly converted back into the same number of Series X-0 Xxxxxxxxx.
00
00
(X) If at any time the Bank Holding Company Act and the
rules and regulations thereunder (the "BHCA Rules") are amended to allow a
holder of Series B-1 Preferred to convert to Series B Preferred, then upon any
Regulated Holder's request, such Regulated Holder shall have the right to
convert shares of Series B-1 Preferred into an equal number of shares of Series
B Preferred to the extent permissible at such time under the BHCA Rules (as
determined by such holder in its sole discretion).
(iii) Conversion Procedure.
(A) Unless otherwise provided in connection with any
conversion, each conversion of Series B-1 Preferred or Series B Preferred, into
Series B Preferred or Series B-1 Preferred, as the case may be, shall be
effected by the surrender of the certificate or certificates representing the
shares to be converted at the principal office of the Corporation at any time
during normal business hours, together with a written notice by the holder of
such shares stating that such holder desires to convert the shares, or a stated
number of the shares, represented by such certificate or certificates into
shares of the other class (and such statement shall obligate the Corporation to
issue such shares). Unless otherwise provided in connection with any conversion,
each conversion shall be deemed to have been effected as of the close of
business on the date on which such certificate or certificates have been
surrendered and such notice has been received, and at such time the rights of
the holder of the converted Series B-1 Preferred and Series B Preferred, as the
case may be, as such holder shall cease and the person or persons in whose name
or names the certificate or certificates for shares of Series B Preferred or
Series B-1 Preferred are to be issued upon such conversion shall be deemed to
have become the holder or holders of record of the Series B Preferred and the
Series B-1 Preferred represented thereby.
(B) Promptly after the surrender of certificates and the
receipt of written notice, the Corporation shall issue and deliver in accordance
with the surrendering holder's instructions (i) the certificate or certificates
for the Series B Preferred and the Series B-1 Preferred issuable upon such
conversion and (ii) a certificate representing any Series B-1 Preferred and
Series B Preferred which were represented by the certificate or certificates
delivered to the Corporation in connection with such conversion but which were
not converted.
(C) The issuance of certificates for Series B-1 Preferred or
Series B Preferred upon conversion of Series B Preferred or Series B-1
Preferred, respectively, shall be made without charge to the holders of such
shares for any issuance tax in respect thereof or other cost incurred by the
Corporation in connection with such conversion and the related issuance of
Series B Preferred and Series B-1 Preferred, as the case may be.
(D) The Corporation has duly authorized, solely for the
purpose of issuance upon the conversion of the Series B-1 Preferred and Series B
Preferred, respectively, such number of Series B Preferred and Series B-1
Preferred, as
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the case may be issuable upon the conversion of all outstanding Series B-1
Preferred and Series B Preferred, as the case may be. All shares which are so
issuable shall, when issued, be duly and validly issued, fully paid and
nonassessable and free from all taxes, liens and charges. The Corporation shall
take all such actions as may be necessary to ensure that all such shares may be
so issued without violation of any applicable law or governmental regulation or
any requirements of any domestic securities exchange upon which shares may be
listed (except for official notice of issuance which shall be immediately
transmitted by the Corporation upon issuance).
(E) The Corporation shall not close its books against the
transfer of Series B-1 Preferred and Series B Preferred in any manner which
would interfere with the timely conversion of any Series B-1 Preferred or Series
B Preferred. The Corporation shall assist and cooperate with any holder of
Series B-1 Preferred and Series B Preferred required to make any governmental
filings or obtain any governmental approval prior to or in connection with any
conversion of Series B-1 Preferred and Series B Preferred hereunder (including,
without limitation, making any filings required to be made by the Corporation).
(F) If the Corporation in any manner subdivides or combines
the outstanding Series B-1 Preferred or Series B Preferred, the outstanding
shares of the other class shall be proportionately subdivided or combined in a
similar manner.
(g) CONVERSION RIGHTS - CONVERSION OF NON-VOTING COMMON STOCK INTO
VOTING COMMON STOCK AND VICE-VERSA.
The holders of Common Stock shall have the following rights with respect to
the conversion of Voting Common Stock into Non-Voting Common Stock or
vice-versa:
(i) Conversion of Voting Common Stock into Non-Voting Common
Stock. At any Regulated Holder's request at any time (whether in connection with
any action by the Corporation referred to in Section 4.2(f)(ii)(B) above or
otherwise), such Regulated Holder shall have the right, upon the occurrence or
possible occurrence of a Regulatory Problem, to convert any number of shares of
Voting Common Stock then held by such Regulated Holder into an equal number of
shares of Non-Voting Common Stock.
(ii) Conversion of Non-Voting Common Stock into Voting Common
Stock.
(A) In connection with the occurrence (or the expected
occurrence as described in Section 4.2(g)(ii)(B) below) of any Conversion Event,
each holder of Non-Voting Common Stock shall be entitled to convert into an
equal number of Voting Common Stock all of such holder's Non-Voting Common Stock
being (or expected to be) distributed, disposed of or sold in connection with
such Conversion Event.
18
52
(B) Each Regulated Holder holding Non-Voting Common Stock
shall be entitled to convert Non-Voting Common Stock in connection with any
Conversion Event if such Regulated Holder reasonably believes that such
Conversion Event shall be consummated, and a written request for conversion from
any Regulated Holder holding Non-Voting Common Stock to the Corporation shall
obligate the Corporation to effect such conversion in a timely manner so as to
enable each such Regulated Holder to participate in such Conversion Event. The
Corporation shall not cancel the Non-Voting Common Stock so converted before the
tenth day following such Conversion Event and shall reserve such Non-Voting
Common Stock until such tenth day for reissuance in compliance with the next
sentence. If any Non-Voting Common Stock are converted into Voting Common Stock
in connection with a Conversion Event and such Voting Common Stock are not
actually distributed, disposed of or sold pursuant to such Conversion Event,
such Voting Common Stock shall be promptly converted back into the same number
of Non-Voting Common Stock.
(C) If at any time the BHCA Rules are amended to allow a
holder of Non-Voting Common Stock to convert to Voting Common Stock, then upon
any Regulated Holder's request, such Regulated Holder shall have the right to
convert shares of Non-Voting Common Stock into an equal number of shares of
Voting Common Stock to the extent permissible at such time under the BHCA Rules
(as determined by such holder in its sole discretion).
(iii) Conversion Procedure.
(A) Unless otherwise provided in connection with any
conversion, each conversion of Non-Voting Common Stock or Voting Common Stock,
into Voting Common Stock or Non-Voting Common Stock, as the case may be, shall
be effected by the surrender of the certificate or certificates representing the
shares to be converted at the principal office of the Corporation at any time
during normal business hours, together with a written notice by the holder of
such shares stating that such holder desires to convert the shares, or a stated
number of the shares, represented by such certificate or certificates into
shares of the other class (and such statement shall obligate the Corporation to
issue such shares). Unless otherwise provided in connection with any conversion,
each conversion shall be deemed to have been effected as of the close of
business on the date on which such certificate or certificates have been
surrendered and such notice has been received, and at such time the rights of
the holder of the converted Non-Voting Common Stock and Voting Common Stock, as
the case may be, as such holder shall cease and the person or persons in whose
name or names the certificate or certificates for shares of Voting Common Stock
or Non-Voting Common Stock are to be issued upon such conversion shall be deemed
to have become the holder or holders of record of the Voting Common Stock and
the Non-Voting Common Stock represented thereby.
(B) Promptly after the surrender of certificates and the
receipt of written notice, the Corporation shall issue and deliver in accordance
with the surrendering holder's instructions (i) the certificate or certificates
for the Voting
19
53
Common Stock and the Non-Voting Common Stock issuable upon such conversion and
(ii) a certificate representing any Non-Voting Common Stock and Voting Common
Stock which were represented by the certificate or certificates delivered to the
Corporation in connection with such conversion but which were not converted.
(C) The issuance of certificates for Non-Voting Common Stock
or Voting Common Stock upon conversion of Voting Common Stock or Non-Voting
Common Stock, respectively, shall be made without charge to the holders of such
shares for any issuance tax in respect thereof or other cost incurred by the
Corporation in connection with such conversion and the related issuance of
Voting Common Stock and Non-Voting Common Stock, as the case may be.
(D) The Corporation has duly authorized, solely for the
purpose of issuance upon the conversion of the Non-Voting Common Stock and
Voting Common Stock, respectively, such number of Voting Common Stock and
Non-Voting Common Stock, as the case may be issuable upon the conversion of all
outstanding Non-Voting Common Stock and Voting Common Stock, as the case may be.
All shares which are so issuable shall, when issued, be duly and validly issued,
fully paid and nonassessable and free from all taxes, liens and charges. The
Corporation shall take all such actions as may be necessary to ensure that all
such shares may be so issued without violation of any applicable law or
governmental regulation or any requirements of any domestic securities exchange
upon which shares may be listed (except for official notice of issuance which
shall be immediately transmitted by the Corporation upon issuance).
(E) The Corporation shall not close its books against the
transfer of Non-Voting Common Stock and Voting Common Stock in any manner which
would interfere with the timely conversion of any Non-Voting Common Stock or
Voting Common Stock. The Corporation shall assist and cooperate with any holder
of Non-Voting Common Stock and Voting Common Stock required to make any
governmental filings or obtain any governmental approval prior to or in
connection with any conversion of Non-Voting Common Stock and Voting Common
Stock hereunder (including, without limitation, making any filings required to
be made by the Corporation).
(F) If the Corporation in any manner subdivides or combines
the outstanding Non-Voting Common Stock or Voting Common Stock, the outstanding
shares of the other class shall be proportionately subdivided or combined in a
similar manner.
(h) CERTAIN DEFINITIONS.
"COMMON STOCK" means the Voting Common Stock and Non-Voting Common Stock,
par value $.0001 per share, of the Corporation.
"COMMON STOCK DEEMED OUTSTANDING" means, at any given time, the number of
shares of Common Stock actually outstanding at such time, plus (a) the number of
20
54
shares of Common Stock which would be issued upon exercise of all of the
Corporation's outstanding Options and (b) the number of shares of Common Stock
which would be issued upon conversion or exchange of all of the Corporation's
outstanding Convertible Securities (including Convertible Securities issuable
upon exercise of Options).
"CONVERTIBLE SECURITIES" means any stock or securities directly or
indirectly convertible into or exchangeable for Common Stock.
"OPTIONS" means any rights, warrants or options to subscribe for or
purchase Common Stock or Convertible Securities.
"PERMITTED ISSUANCE" means any issuance of Reserved Employee Stock.
"REGULATED HOLDER" means any holder of Preferred Stock or Common Stock who
is regulated under the BHCA Rules.
"REGULATORY PROBLEM" means any transaction, circumstance or situation
whereby (i) any Regulated Holder and its affiliates would own, control or have
power over a greater quantity of securities of any kind issued by the
Corporation or any other entity than are permitted under any requirement of any
governmental authority, or would cause such Regulated Holder or any of its
affiliates to not be able to hold an investment in or provide financing to the
Corporation in compliance with any applicable requirement of any governmental
authority, or (ii) it has been asserted by any governmental regulatory agency
(or any Regulated Holder believes that there is a risk of such assertion) that
such Regulated Holder and its affiliates are not entitled to hold the shares
held by such Regulated Holder and its affiliate or exercise any significant
right with respect to the shares held by such person or provide financing to the
Corporation in compliance with any applicable requirement of any governmental
authority.
"RESERVED EMPLOYEE STOCK" means the shares of Common Stock issuable to
employees, directors or consultants of the Corporation and its Subsidiaries
pursuant to options granted under the VeloCom Inc. Amended and Restated 1998
Stock Option Plan, which amount shall in no event exceed twelve percent (12%) of
the Corporation's Common Stock Deemed Outstanding.
"SUBSIDIARY" means any corporation of which 50% or more of the shares of
outstanding capital stock possessing the voting power (under ordinary
circumstances) in electing the board of directors are, at the time as of which
any determination is being made, owned by the Corporation either directly or
indirectly through Subsidiaries.
(i) AMENDMENT AND WAIVER.
No amendment, modification or waiver of any of the terms or provisions of
the Series Preferred shall be binding or effective without the prior written
consent of the Required Holders and no change in the terms hereof may be
accomplished by merger or consolidation of the Corporation with another
corporation or entity unless the Corporation
21
55
has obtained the prior written consent of the Required Holders; provided,
however, that no such action shall adversely alter or change any of the rights,
preferences, or privileges of the Series A Preferred without the prior written
consent of the holders of at least 75% of the Series A Preferred then
outstanding; and provided, further, than no such action shall adversely alter or
change any of the rights, preferences or privileges of the Series B/B-1
Preferred without the prior written consent of at least 75% of the Series B/B-1
Preferred then outstanding. Any amendment, modification or waiver of any of the
terms or provisions of the Series Preferred by the Required Holders (or such
higher vote as may be required), whether prospective or retroactively effective,
shall be binding upon all holders of the Series Preferred.
(j) GENERAL PROVISIONS.
(i) Registration of Transfer. The Corporation shall keep at its
principal office a register for the registration of the Series Preferred. Upon
the surrender of any certificate representing the Series Preferred at such
place, the Corporation shall, at the request of the record holder of such
certificate, execute and deliver (at the Corporation's expense) a new
certificate or certificates in exchange therefor representing in the aggregate
the number of shares represented by the surrendered certificate. Each such new
certificate shall be registered in such name and shall represent such number of
shares as is requested by the holder of the surrendered certificate and shall be
substantially identical in form to the surrendered certificate.
(ii) Replacement. Upon receipt of evidence reasonably
satisfactory to the Corporation (an affidavit of the registered holder shall be
satisfactory) of the ownership and the loss, theft, destruction or mutilation of
any certificate evidencing shares of the Series Preferred, and in the case of
any such loss, theft or destruction, upon receipt of indemnity reasonably
satisfactory to the Corporation (provided, however, that if the holder is a
financial institution or other institutional investor its own agreement shall be
satisfactory), or in the case of any such mutilation upon surrender of such
certificate, the Corporation shall (at its expense) execute and deliver in lieu
of such certificate a new certificate of like kind representing the number of
shares of such class represented by such lost, stolen, destroyed or mutilated
certificate and dated the date of such lost, stolen, destroyed or mutilated
certificate.
(iii) Reservation of Common Stock Issuable Upon Conversion. The
Corporation shall at all times reserve and keep available out of its authorized
but unissued shares of Common Stock, solely for the purpose of effecting the
conversion of the shares of the Series Preferred, such number of its shares of
Common Stock as shall from time to time be sufficient to effect the conversion
of all outstanding shares of the Series Preferred. If at any time the number of
authorized but unissued shares of Common Stock shall not be sufficient to effect
the conversion of all then-outstanding shares of the Series Preferred, the
Corporation shall take such corporate action as may, in the opinion of its
counsel, be necessary to increase its authorized but unissued shares of Common
Stock to such number of shares as shall be sufficient for such purpose.
22
56
(iv) Notices. Any notice required by the provisions of this
Amended and Restated Certificate of Incorporation shall be in writing and shall
be deemed effectively given: (i) upon personal delivery to the party to be
notified, (ii) when sent by confirmed telex or facsimile if sent during normal
business hours of the recipient; if not, then on the next business day, (iii)
five (5) days after having been sent by registered or certified mail, return
receipt requested, postage prepaid, or (iv) one (1) day after deposit with a
nationally recognized overnight courier, specifying next day delivery, with
written verification of receipt. All notices to stockholders shall be addressed
to each holder of record at the address of such holder appearing on the books of
the Corporation.
(v) Payment of Taxes. The Corporation shall pay all taxes (other
than taxes based upon income) and other governmental charges that may be imposed
with respect to the issue or delivery of shares of Common Stock upon conversion
of shares of the Series Preferred, excluding any tax or other charge imposed in
connection with any transfer involved in the issue and delivery of shares of
Common Stock in a name other than that in which the shares of the Series
Preferred so converted were registered.
(vi) No Dilution or Impairment. The Corporation shall not amend
its Certificate of Incorporation or participate in any reorganization, transfer
of assets, consolidation, merger, dissolution, issue or sale of securities or
any other voluntary action, for the purpose of avoiding or seeking to avoid the
observance or performance of any of the terms to be observed or performed
hereunder by the Corporation.
(vii) No Reissuance of the Series Preferred. No share or shares
of the Series Preferred acquired by the Corporation by reason of redemption,
purchase, conversion or otherwise shall be reissued.
ARTICLE FIVE.
The Corporation is to have perpetual existence.
ARTICLE SIX.
In furtherance and not in limitation of the powers conferred by statute,
the board of directors of the Corporation is expressly authorized to make, alter
or repeal the Bylaws of the Corporation.
ARTICLE SEVEN.
The management of the business and the conduct of the affairs of the
Corporation shall be vested in its board of directors. The number of directors
which shall constitute the whole board of directors shall be fixed by, or in the
manner provided in, the Bylaws of the Corporation.
23
57
ARTICLE EIGHT.
Meetings of stockholders may be held within or without the State of
Delaware, as the Bylaws of the Corporation may provide. The books of the
Corporation may be kept (subject to any provision contained in the statutes)
outside the State of Delaware at such place or places as may be designated from
time to time by the board of directors or in the Bylaws of the Corporation.
Election of directors need not be by written ballot unless the Bylaws of the
Corporation so provide.
ARTICLE NINE.
The Corporation shall indemnify, to the fullest extent permitted by Section
145 of the Delaware General Corporation Law, as amended from time to time, all
persons who it may indemnify pursuant thereto. The personal liability of a
director of the Corporation to the Corporation or its stockholders for monetary
damages for breach of fiduciary duty as a director shall be limited to the
fullest extent permitted by the Delaware General Corporation Law, as it now
exists or may hereafter be amended. Any repeal or modification of this paragraph
by the stockholders of the Corporation shall not adversely affect any right or
protection of a director of the Corporation existing at the time of such repeal
or modification.
ARTICLE TEN.
The Corporation expressly elects not to be governed by Section 203 of the
Delaware General Corporation Law.
ARTICLE ELEVEN.
The Corporation reserves the right to amend, alter, change or repeal any
provision contained in this Amended and Restated Certificate of Incorporation in
the manner now or hereafter prescribed herein and by the laws of the State of
Delaware, and all rights conferred upon stockholders herein are granted subject
to this reservation.
24
58
IN WITNESS WHEREOF, the Corporation has caused this Second Amended &
Restated Certificate of Incorporation to be signed and executed in its corporate
name by Xxxxx X. Xxxxxxx, its President and Chief Executive Officer, and
attested to by Xxxxxxx X. Xxxxx, its Assistant Secretary, and its Corporate Seal
to be affixed on this ___ day of January, 2000.
VELOCOM INC.
By:
-------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: President and Chief Executive
Officer
Attest:
--------------------------
Name: Xxxxxxx X. Xxxxx
Title: Assistant Secretary
25
59
FOLLOW-ON SERIES B/B-1 STOCK PURCHASE AGREEMENT
EXHIBIT C
CAPITALIZATION CHART
C-1
60
VeloCom Inc.
Capitalization Table
December 27, 1999
Current Capitalization Funding 12/6/99
--------------------------------------------------------------- ------------------------
Number of Shares Funding Shares
---------------------------------------- Total Fully ----------- -----------
Investment Diluted $6.00
Common Preferred Total $000's Own% $45,942
------------ ------------ ----------- ------------ ------- ----------- -----------
INVESTMENT FUNDS
Telecom Partners II, L.P. 1,500,000 5,605,775 7,105,775 $ 18,317,325 15.52% $ 4,999,998 833,333
Telecom Partners III, L.P. 0 0 0 $ -- 0.00% $ -- --
------------ ------------ ----------- ------------ ------- ----------- -----------
Total Telecom Partners 1,500,000 5,605,775 7,105,775 18,317,325 15.52% $ 4,999,998 833,333
Centennial Fund V, L.P. 932,600 4,186,631 5,119,231 $ 13,492,493 11.18% $ 1,500,000 250,000
Centennial Fund VI, L.P. 0 0 0 $ -- 0.00% $ 7,858,854 1,309,809
Centennial Entrepreneurs Fund V, L.P. 28,940 129,918 158,858 $ 418,694 0.35% $ -- --
Centennial Entrepreneurs Fund VI, L.P. -- -- -- $ -- 0.00% $ 196,470 32,745
Centennial Strategic Partners
Fund VI, L.P. -- -- -- $ -- 0.00% $ -- --
Centennial Holdings I, L.L.C. 38,460 172,655 211,115 $ 558,425 0.46% $ 219,036 36,506
------------ ------------ ------------ ------------ ------- ----------- -----------
Total Centennial Funds 1,000,000 4,489,204 5,489,204 14,467,612 11.99% $ 9,774,360 1,629,060
Eagle Ventures WF, L.L.C.(Crescendo) 22,850 57,460 80,310 $ 195,230 0.18% $ 30,074 5,079
Crescendo III, GbP. 0 0 0 $ -- 0.00% $ 78,354 13,059
Crescendo III Executive Fund, LP 0 0 0 $ -- 0.00% $ 112,860 18,810
Crescendo World Fund, L.L.C. 477,150 1,199,883 1,677,033 $ 4,076,799 3.66% $ 636,198 106,033
Crescendo III, L.P. 0 3,514,683 3,514,683 $ 10,544,049 7.88% $ 3,799,998 633,333
------------ ------------ ------------ ------------ ------- ----------- -----------
Total Crescendo Ventures 500,000 4,772,026 5,272,026 14,816,078 11.51% $ 4,657,884 776,314
SLI Wireless S.A. 4,330,709 7,840,000 12,170,709 $ 34,520,001 26.58% $ 9,000,000 1,500,000
Formus Common - LA Holdings, LLC 1,574,803 7,866,333 9,441,136 $ 27,598,999 20.62% $ 5,599,998 933,333
Taquari Participatoes S.A. 1,035,054 0 1,035,064 $ 2,629,063 2.28% $ -- --
Black Coral Enterprises Inc. (Taquari) 638,164 0 638,164 $ 1,620,937 1.39% $ -- --
------------ ------------ ------------ ------------ ------- ----------- -----------
Total Taquari 1,673,220 0 1,673,228 4,249,999 3.65% $ -- --
------------ ------------ ------------ ------------ ------- ----------- -----------
TOTAL INVESTMENT FUNDS 10,578,740 30,573,338 $ 41,152,078 $113,970,014 89.87% $34,032,240 5,672,040
NEW INVESTORS:
Xxxxx Capital Management -- -- -- $ -- 0% $ 250,002 41,667
Xxxx Xxxxx Capital, L.P. -- -- -- $ -- 0% $ 155,100 25,050
Xxxx Xxxxx Capital Ventures, L.P. -- -- -- $ -- 0% $ 131,400 21,900
Xxxx Xxxxx Capital International -- -- -- $ -- 0% $ 101,400 16,900
Xxxx Xxxxx Capital, Inc. -- -- -- $ -- 0% $ 12,300 2,050
Mellon Ventures II, L.P. -- -- -- $ -- 0% $10,000,002 1,666,667
Bank of America -- -- -- $ -- 0% $ -- --
Xxxxxxxx Xxxxxxxxxxxx -- -- -- $ -- 0% $ -- --
Chestnut Hill VeloCom, LLC -- -- -- $ -- 0% $ -- --
Dolphin Communications Fund, LP -- -- -- $ -- 0% $ -- --
Dolphin Communications
Parallel Fund, LP -- -- -- $ -- 0% $ -- --
First Union -- -- -- $ -- 0% $ -- --
Toronto Dominion Investments, Inc. -- -- -- $ -- 0% $ -- --
CRI Media Partners, LP -- -- -- $ -- 0% $ -- --
CRI Media Partners II, LP -- -- -- $ -- 0% $ -- --
Northwood Ventures LLC -- -- -- $ -- 0% $ -- --
Aleks Aermovic -- -- -- $ -- 0% $ -- --
Orkin R Xxxxxxxx -- -- -- $ -- 0% $ -- --
Ravi Mhattre -- -- -- $ -- 0% $ -- --
TD Securities (USA), Inc. -- -- -- $ -- 0% $ -- --
------------ ------------ ------------ ------------ ------- ----------- -----------
SUBTOTAL: NEW INVESTORS -- -- -- $ -- -- $10,650,204 1,775,034
MANAGEMENT & DIRECTORS
Xxxx X. Xxxxxx 100,000 37,531 137,531 $ 212,593 0.30% $ 250,002 41,667
Xxxxxxxx Xxxxxx 100,000 37,531 137,531 $ 212,593 0.30% $ 49,998 8,333
Xxxxx X. Xxxxxxx 118,615 18,615 137,230 $ 242,940 0.30% $ 49,998 8,333
Xxxxx Xxxxx 83,333 0 83,333 $ 249,999 0.18% $ 49,998 8,333
Xxxxxx XxXxxxxx 50,000 18,766 68,766 $ 106,298 0.15% $ 75,000 12,500
Comm Capital Ptns Inc/ Xxxxxx Xxxxxxxxx 50,000 0 50,000 $ 150,000 0.11% $ 750,000 125,000
Xxxxxxx X. Xxxxxx 25,000 9,383 34,383 $ 53,149 0.08% $ 19,998 3,333
R. Xxxxxx House 25,000 9,307 34,307 $ 84,171 0.07% $ -- --
Reinco (Xxxx Xxxxx) 25,000 0 25,000 $ 56,250 0.05% $ -- --
Xxxxxxx Xxxxx 25,000 0 25,000 $ 75,000 0.05% $ -- --
Xxxx Xxxxxxx 25,000 0 25,000 $ 56,250 0.05% $ 15,000 2,500
Xxxxx Tomzuka 25,000 0 25,000 $ 75,000 0.05% $ -- --
------------ ------------ ------------ ------------ ------- ----------- -----------
TOTAL MANAGEMENT & DIRECTORS 651,946 131,133 783,081 $ 1,574,243 1.71% $ 1,259,994 209,999
------------ ------------ ------------ ------------ ------- ----------- -----------
TOTAL FUNDS AND MANAGEMENT 11,230,688 30,704,471 41,935,159 $115,544,257 91.58% $45,942,438 7,657,073
TOTAL OTHER SHAREHOLDERS 53,138 1,862 55,000 $ 149,414 0.12% $ -- --
------------ ------------ ------------ ------------ ------- ----------- -----------
TOTAL SHARES OUTSTANDING 11,283,826 30,706,333 41,990,159 $115,693.671 91.70% $45,942,438 7,657,073
------------ ------------
STOCK OPTIONS 3,798,544 -- 8.30% $ -- 7,609,205
------------ ------------ ------- ----------- -----------
FULLY DILUTED SHARES OUTSTANDING 45,788,703 $115,693,671 100.00% $45,942,438 15,266,278
Implied Valuation per share Pre-Money Current
Round
$6.00 $ 274,732 $ 91.598
a) 948,913 of these shares represent voting series B preferred stock, which will
represent 4.9159% of the total outstanding shares of voting series B
preferred stock immediately following the January 7, 2000 funding.
61
VeloCom Inc.
Capitalization Table
December 27, 1999 (continued)
To Be Funded 01/07/00 Funded 6/30/00
------------------------- -------------------------
Funding Shares Funding Shares
------------------------- -------------------------
$6.00 $6.00
$82,058 $61,000
----------- ----------- ----------- -----------
INVESTMENT FUNDS
Telecom Partners II, L.P. $ -- -- $ -- --
Telecom Partners III, L.P. $19,999,998 3,333,333 $10,000,002 1,666,667
----------- -----------
Total Telecom Partners $19,999,998 3,333,333 $10,000,002 1,666,667
Centennial Fund V, L.P. $ -- -- $ 750,000 125,000
Centennial Fund VI, L.P. $ -- -- $ 3,570,576 595,096
Centennial Entrepreneurs Fund V, L.P. $ -- -- $ -- --
Centennial Entrepreneurs Fund VI, L.P. $ -- -- $ 89,265 14,878
Centennial Strategic Partners Fund VI, L.P. $ -- -- $ 375,000 62,500
Centennial Holdings I, L.L.C. $ -- -- $ 102,342 17,057
----------- -----------
Total Centennial Funds $ -- -- $ 4,867,186 814,531
Eagle Ventures WF, L.L.C.(Crescendo) $ 15,228 2,538 $ 22,654 3,809
Crescendo III, GbP. $ 68,880 11,480 $ 73,620 12,270
Crescendo III Executive Fund, LP $ 99,222 16,537 $ 106,038 17,673
Crescendo World Fund, L.L.C. $ 318,102 53,017 $ 477,150 79,525
Crescendo III, L.P. $ 3,340,692 556,782 $ 3,570,348 595,058
----------- ----------- ----------- -----------
Total Crescendo Ventures $ 3,642,124 640,354 $ 4,250,010 708,335
SLI Wireless S.A. $ 5,500,002 916,667 $ 7,249,998 1,208,333
Formus Common - LA Holdings, LLC $ -- -- $ 2,800,002 466,667
Taquari Participatoes S.A. $ -- -- $ -- --
Black Coral Enterprises Inc. (Taquari) $ -- -- $ -- --
----------- ----------- -----------
Total Taquari $ -- -- $ -- --
----------- -----------
TOTAL INVESTMENT FUNDS $29,342,124 4,890,354 $29,187,198 4,864,533
NEW INVESTORS:
Xxxxx Capital Management $ -- -- $ 125,004 20,834
Xxxx Xxxxx Capital, L.P. $ -- -- $ 77,550 12,925
Xxxx Xxxxx Capital Ventures, L.P. $ -- -- $ 65,700 10,950
Xxxx Xxxxx Capital International $ -- -- $ 50,700 8,450
Xxxx Xxxxx Capital, Inc. $ -- -- $ 6,150 1,025
Mellon Ventures II, L.P. $ -- -- $ 5,000,004 833,334
Bank of America $17,500,002 2,918,667 $ 8,749,998 1,458,333
Xxxxxxxx Xxxxxxxxxxxx $ 7,500,000 1,250,000 $ 3,750,000 625,000
Chestnut Hill VeloCom, LLC $10,350,000 1,725,000 $ 5,175,000 862,500
Dolphin Communications Fund, LP $ 1,758,840 293,140 $ 879,420 146,570
Dolphin Communications Parallel
Fund, LP $ 741,162 123,527 $ 370,578 61,763
First Union $ 9,572,934 1,595,489 $ 4,786,470 797,745
Toronto Dominion Investments, Inc. $ 3,499,992 583,333 $ 1,750,002 291,667
CRI Media Partners, LP $ 79,995 13,333 $ 40,002 6,667
CRI Media Partners II, LP $ 319,998 53,333 $ 160,002 28,667
Northwood Ventures LLC $ 750,000 125,000 $ 375,000 62,500
Aleks Aermovic $ 49,998 8,333 $ 25,002 4,167
Orkin R Xxxxxxxx $ 30,000 5,000 $ 15,000 2,500
Ravi Mhattre $ 37,500 6,250 $ 18,750 3,125
TD Securities (USA), Inc. $ 150,000 25,000 $ 75,000 12,500
$ -- $ -- $ -- --
----------- ----------- ----------- -----------
SUBTOTAL: NEW INVESTORS $52,340,430 8,723,405 $31,495,332 5,249,222
MANAGEMENT & DIRECTORS
Xxxx X. Xxxxxx $ -- -- $ -- --
Xxxxxxxx Xxxxxx $ -- -- $ 25,002 4,167
Xxxxx X. Xxxxxxx $ -- -- $ 25,002 4,167
Xxxxx Xxxxx $ -- -- $ 25,002 4,167
Xxxxxx XxXxxxxx $ -- -- $ 37,500 6,250
Comm Capital Ptns Inc/ Xxxxxx Xxxxxxxxx $ -- -- $ 375,000 62,500
Xxxxxxx X. Xxxxxx $ -- -- $ 10,002 1,667
R. Xxxxxx House $ -- -- $ -- --
Reinco (Xxxx Xxxxx) $ -- -- $ -- --
Xxxxxxx Xxxxx $ -- -- $ -- --
Xxxx Xxxxxxx $ -- -- $ 7,500 1,250
Xxxxx Tomazuka $ -- -- $ -- --
----------- ----------- -----------
TOTAL MANAGEMENT & DIRECTORS $ -- -- $ 505,008 84,168
$ -- $ --
----------- ----------- ----------- -----------
TOTAL FUNDS AND MANAGEMENT $81,682,554 13,613,759 $61,187,538 10,197,923
TOTAL OTHER SHAREHOLDERS $ -- -- $ -- --
----------- ----------- -----------
TOTAL SHARES OUTSTANDING $81,682,554 13,613,759 $61,187,538 10,197,923
----------- -----------
STOCK OPTIONS $ -- -- $ -- --
----------- ----------- ----------- -----------
FULLY DILUTED SHARES OUTSTANDING 81,682,554 13,613,758 $61,187,538 10,197,923
Implied Valuation Current Round Current Round
$ 81,683 $ 61,188
a) 948,913 of these shares represent voting series B preferred stock, which will
represent 4.9159% of the total outstanding shares of voting series B
preferred stock immediately following the January 7, 2000 funding.
2
62
VeloCom Inc.
Capitalization Table
December 27, 1999 (continued)
To Be Funded 09/30/00 Total Current Round
--------------------------- ---------------------------
Funding Shares Funding Shares
--------------------------- ---------------------------
$6.00 $6.00
$61,000 $250,000
------------ ------------ ------------ ------------
INVESTMENT FUNDS
Telecom Partners II, L.P. $ -- -- $ 4,999,998 833,333
Telecom Partners III, L.P. $ 10,000,002 1,666,667 $ 40,000,002 6,656,667
------------ ------------ ------------ ------------
Total Telecom Partners $ 10,000,002 1,666,667 $ 45,000,000 7,500,000
Centennial Fund V, L.P. $ 750,000 125,000 $ 3,000,000 500,000
Centennial Fund VI, L.P. $ 3,570,570 595,095 $ 15,000,000 2,500,000
Centennial Entrepreneurs Fund V, L.P. $ -- -- $ -- --
Centennial Entrepreneurs Fund VI, L.P. $ 89,262 14,877 $ 375,000 62,500
Centennial Strategic Partners Fund VI, L.P. $ 375,000 62,500 $ 750,000 125,000
Centennial Holdings I, L.L.C. $ 102,342 17,057 $ 423,720 70,620
------------ ------------ ------------ ------------
Total Centennial Funds $ 4,887,174 814,529 $ 19,548,720 3,258,120
Eagle Ventures WF, L.L.C.(Crescendo) $ 22,848 3,808 $ 91,404 15,234
Crescendo III, GbP. $ 73,614 12,269 $ 294,468 49,078
Crescendo III Executive Fund, LP $ 106,038 17,673 $ 424,158 70,693
Crescendo World Fund, L.L.C. $ 477,150 79,525 $ 1,908,600 318,100
Crescendo III, L.P. $ 3,570,342 595,057 $ 14,281,380 2,380,230
------------ ------------ ------------ ------------
Total Crescendo Ventures $ 4,249,992 708,332 $ 17,000,010 2,833,335
SLI Wireless S.A. $ 7,249,998 1,208,333 $ 28,999,998 4,833,333
Formus Common - LA Holdings, LLC $ 2,799,996 466,666 $ 11,199,996 1,886,666
Taquari Participatoes S.A. $ -- -- $ -- --
Black Coral Enterprises Inc. (Taquari) $ -- -- $ -- --
------------ ------------ ------------ ------------
Total Taquari $ -- -- $ -- --
------------ ------------ ------------ ------------
TOTAL INVESTMENT FUNDS $ 29,187,162 4,884,527 $121,748,724 20,291,454
NEW INVESTORS:
Xxxxx Capital Management $ 124,998 20,833 $ 500,004 83,334
Xxxx Xxxxx Capital, L.P. $ 77,550 12,925 $ 310,200 51,700
Xxxx Xxxxx Capital Ventures, L.P. $ 65,700 10,950 $ 262,800 43,800
Xxxx Xxxxx Capital International $ 50,700 8,450 $ 202,800 33,800
Xxxx Xxxxx Capital, Inc. $ 6,150 1,025 $ 24,600 4,100
Mellon Ventures II, L.P. $ 4,999,998 833,333 $ 20,000,004 3,333,334
Bank of America $ 8,749,998 1,458,333 $ 34,999,996 5,833,333
Xxxxxxxx Xxxxxxxxxxxx $ 3,750,000 625,000 $ 15,000,000 2,500,000
Chestnut Hill VeloCom, LLC $ 5,175,000 862,500 $ 20,700,000 3,450,000
Dolphin Communications Fund, LP $ 879,420 146,570 $ 3,517,680 586,280
Dolphin Communications Parallel
Fund, LP $ 370,578 61,763 $ 1,462,318 247,053
First Union $ 4,786,470 797,745 $ 19,145,874 3,190,979
Toronto Dominion Investments, Inc. $ 1,750,002 291,667 $ 7,000,002 1,166,667
CRI Media Partners, LP $ 40,002 6,667 $ 160,002 26,667
CRI Media Partners II, LP $ 160,002 26,667 $ 640,002 106,667
Northwood Ventures LLC $ 375,000 62,500 $ 1,500,000 250,000
Aleks Aermovic $ 25,002 4,167 $ 100,002 16,667
Orkin R Xxxxxxxx $ 15,000 2,500 $ 60,000 10,000
Ravi Mhattre $ 18,750 3,125 $ 75,000 12,500
TD Securities (USA), Inc. $ 75,000 12,500 $ 300,000 50,000
$ -- -- $ -- --
------------ ------------ ------------ ------------
SUBTOTAL: NEW INVESTORS $ 31,495,320 5,249,220 $125,981,286 20,995,881
MANAGEMENT & DIRECTORS
Xxxx X. Xxxxxx $ -- -- $ 250,002 41,667
Xxxxxxxx Xxxxxx $ 24,995 4,166 $ 99,996 16,666
Xxxxx X. Xxxxxxx $ 24,995 4,166 $ 99,996 16,666
Xxxxx Xxxxx $ 24,995 4,166 $ 99,996 16,666
Xxxxxx XxXxxxxx $ 37,500 6,250 $ 150,000 25,000
Comm Capital Ptns Inc/ Xxxxxx Xxxxxxxxx $ 375,000 82,500 $ 1,500,000 250,000
Xxxxxxx X. Xxxxxx $ 9,996 1,666 $ 39,996 6,666
R. Xxxxxx House $ -- -- $ -- --
Reinco (Xxxx Xxxxx) $ -- -- $ -- --
Xxxxxxx Xxxxx $ -- -- $ -- --
Xxxx Xxxxxxx $ 7,500 1,250 $ 30,000 5,000
Xxxxx Tomazuka $ -- -- $ -- --
------------ ------------ ------------ ------------
TOTAL MANAGEMENT & DIRECTORS $ 504,984 84,164 $ 2,289,986 378,331
------------ ------------ ------------ ------------
TOTAL FUNDS AND MANAGEMENT $ 61,187,466 10,197,911 $249,999,996 41,666,666
TOTAL OTHER SHAREHOLDERS $ -- -- $ -- --
------------ ------------ ------------ ------------
TOTAL SHARES OUTSTANDING $ 61,187,466 10,197,911 $249,999,996 41,666,666
STOCK OPTIONS $ -- -- $ -- 7,609,205
------------ ------------ ------------ ------------
FULLY DILUTED SHARES OUTSTANDING $ 61,187,466 10,197,911 $249,999,996 49,275,871
Implied Valuation Current Round Current Round
$ 61,187 $ 295,855
a) 948,913 of these shares represent voting series B preferred stock, which will
represent 4.9159% of the total outstanding shares of voting series B
preferred stock immediately following the January 7, 2000 funding.
3
63
VeloCom Inc.
Capitalization Table
December 27, 1999 (continued)
Pro Forma
----------------------------------------------------------------------------------------
Total Investment Avg. Investment per share Number of Shares Fully Diluted Own %
------------------ ---------------------------- ------------------ ---------------------
INVESTMENT FUNDS
Telecom Partners II, L.P. $ 23,317,323 $ 2.94 7,939,108 8.35%
Telecom Partners III, L.P. $ 40,000,002 $ 6.00 6,666,667 7.01%
------------ ------------- ------------ -------
Total Telecom Partners $ 63,317,325 $ 4.34 14,605,775 15.36%
Centennial Fund V, L.P. $ 16,492,493 $ 2.94 5,619,231 5.91%
Centennial Fund VI, L.P. $ 15,000,000 $ 6.00 2,500,000 2.63%
Centennial Entrepreneurs Fund V, L.P. $ 418,694 $ 2.64 158,858 0.17%
Centennial Entrepreneurs Fund VI, L.P. $ 375,000 $ 6.00 62,500 0.07%
Centennial Strategic Partners
Fund VI, L.P. $ 750,000 $ 6.00 125,000 0.13%
Centennial Holdings I, L.L.C. $ 980,145 $ 3.48 281,735 0.30%
------------ ------------- ------------ -------
Total Centennial Funds $ 34,016,332 $ 3.89 8,747,324 9.20%
Eagle Ventures WF, L.L.C.(Crescendo) $ 286,634 $ 3.00 95,544 0.10%
Crescendo III, GbP. $ 294,468 $ 6.00 49,078 0.05%
Crescendo III Executive Fund, LP $ 424,158 $ 6.00 70,693 0.07%
Crescendo World Fund, L.L.C. $ 5,985,399 $ 3.00 1,995,133 2.10%
Crescendo III, L.P. $ 24,825,429 $ 4.21 5,894,913 6.20%
------------ ------------- ------------ -------
Total Crescendo Ventures $ 31,816,088 $ 3.93 8,105,361 8.53%
SLI Wireless S.A. $ 63,519,999 $ 3.74 17,004,042 17.89%
Formus Common - LA Holdings, LLC $ 38,798,995 $ 3.43 11,307,802 11.89%
Taquari Participatoes S.A. $ 2,629,063 $ 2.54 1,035,064 1.09%
Black Coral Enterprises Inc. (Taquari) $ 1,620,937 $ 2.54 638,164 0.67%
------------ ------------- ------------ -------
Total Taquari $ 4,249,999 $ 2.54 1,673,228 1.76%
TOTAL INVESTMENT FUNDS $235,718,738 $ 3.84 81,443,532 64.63%
NEW INVESTORS:
Xxxxx Capital Management $ 500,004 $ 6.00 83,334 0.09%
Xxxx Xxxxx Capital, L.P. $ 310,200 $ 6.00 51,700 0.05%
Xxxx Xxxxx Capital Ventures, L.P. $ 262,800 $ 6.00 43,800 0.05%
Xxxx Xxxxx Capital International $ 202,800 $ 6.00 33,800 0.04%
Xxxx Xxxxx Capital, Inc. $ 24,800 $ 6.00 4,100 0.00%
Mellon Ventures II, L.P. $ 20,000,004 $ 6.00 3,333,334 3.51%
Bank of America $ 34,999,998 $ 6.00 5,833,333 6.14%
Xxxxxxxx Xxxxxxxxxxxx $ 15,000,000 $ 6.00 2,500,000 2.63%
Chestnut Hill VeloCom, LLC $ 20,700,000 $ 6.00 3,450,000 3.63%
Dolphin Communications Fund, LP $ 3,517,680 $ 6.00 586,280 0.62%
Dolphin Communications Parallel
Fund, LP $ 1,482,318 $ 6.00 247,053 0.26%
First Union $ 19,145,874 $ 6.00 3,190,979 3.36%
Toronto Dominion Investments, Inc. $ 7,000,002 $ 6.00 1,165,667 1.23%
CRI Media Partners, LP $ 160,002 $ 6.00 26,667 0.03%
CRI Media Partners II, LP $ 640,002 $ 6.00 106,667 0.11%
Northwood Ventures LLC $ 1,500,000 $ 6.00 250,000 0.26%
Aleks Aermovic $ 100,002 $ 6.00 16,667 0.02%
Orkin R Xxxxxxxx $ 60,000 $ 6.00 10,000 0.01%
Ravi Mhattre $ 75,000 $ 6.00 12,500 0.01%
TD Securities (USA), Inc. $ 300,000 $ 6.00 50,000 0.05%
$ -- $ 6.00 0 0.00%
------------ ------------- ------------ -------
SUBTOTAL: NEW INVESTORS $125,981,286 $ 6.00 20,996,881 22.09%
MANAGEMENT & DIRECTORS
Xxxx X. Xxxxxx $ 462,595 $ 2.58 179,198 0.19%
Xxxxxxxx Xxxxxx $ 312,589 $ 2.03 154,197 0.16%
Xxxxx X. Xxxxxxx $ 342,936 $ 2.23 153,896 0.16%
Xxxxx Xxxxx $ 349,995 $ 3.50 99,999 0.11%
Xxxxxx XxXxxxxx $ 256,298 $ 2.73 93,766 0.10%
Comm Capital Ptns Inc/ Xxxxxx Xxxxxxxxx $ 1,650,000 $ 5.50 300,000 0.32%
Xxxxxxx X. Xxxxxx $ 93,145 $ 2.27 41,049 0.04%
R. Xxxxxx House $ 84,171 $ 2.45 34,307 0.04%
Reinco (Xxxx Xxxxx) $ 56,250 $ 2.25 25,000 0.03%
Xxxxxxx Xxxxx $ 75,000 $ 3.00 25,000 0.03%
Xxxx Xxxxxxx $ 86,250 $ 2.88 30,000 0.03%
Xxxxx Tomzuka $ 75,000 $ 3.00 25,000 0.03%
------------ ------------- ------------ -------
TOTAL MANAGEMENT & DIRECTORS $ 3,844,229 $ 3.31 1,161,412 1.22%
TOTAL FUNDS AND MANAGEMENT $365,544,253 $ 4.37 83,601,825 87.94%
TOTAL OTHER SHAREHOLDERS $ 149,414 $ 2.72 55,000 0.06%
------------- ------------ -------
TOTAL SHARES OUTSTANDING $365,693,667 $ 4.37 83,656,825 88.00%
STOCK OPTIONS $ -- $ 11,407,749 12.00%
------------- ------------ -------
FULLY DILUTED SHARES OUTSTANDING $365,693,667 $ 3.85 95,064,574 100.00%
Implied Valuation Post-Money
$ 570,387
a) 948,913 of these shares represent voting series B preferred stock, which will
represent 4.9159% of the total outstanding shares of voting series B
preferred stock immediately following the January 7, 2000 funding.
4
64
FOLLOW-ON SERIES B/B-1 STOCK PURCHASE AGREEMENT
EXHIBIT D
FORM OF THIRD AMENDED AND RESTATED INVESTORS AGREEMENT
FILED AS EXHIBIT 4.1 TO THE REGISTRATION STATEMENT
D-1
65
FOLLOW-ON SERIES B/B-1 STOCK PURCHASE AGREEMENT
EXHIBIT E
FORM OF LEGAL OPINION
E-1
66
EXHIBIT E
FORM OF LEGAL OPINION
We are of the opinion that:
1. The Company is a corporation duly incorporated, validly existing and in
good standing under the laws of the State of Delaware, with full corporate power
and authority to own, lease and operate its properties and to conduct its
business. The Company is qualified to do business and in good standing in each
jurisdiction in the United States where the failure to be so qualified would
result in a material adverse effect on the business, operations, assets,
prospects or condition (financial or otherwise) of the Company (a "Material
Adverse Effect").
2. The authorized capital stock of the Company, immediately prior to the
Initial Closing Date, shall consist of (a) one hundred eight million six hundred
thirty four thousand four hundred twenty one (108,634,421) shares of Common
Stock, of which (i) one hundred six million six hundred sixty six thousand six
hundred sixty seven (106,666,667) will be designated as Voting Common Stock,
eleven million two hundred eighty three thousand eight hundred twenty six
(11,283,826) of which will be issued and outstanding immediately prior to the
Initial Closing Date, and (ii) one million nine hundred sixty seven thousand
seven hundred fifty four (1,967,754) will be designated as Non-Voting Common
Stock, none of which will be issued and outstanding immediately prior to the
Initial Closing Date, and (b) seventy eight million six hundred thirty four
thousand four hundred twenty one (78,634,421) shares of Preferred Stock, of
which (i) thirty one million (31,000,000) will be designated as Series A
Preferred Stock, thirty million seven hundred six thousand three hundred thirty
three (30,706,333) of which will be issued and outstanding immediately prior to
the Initial Closing Date, (ii) forty one million six hundred sixty six thousand
six hundred sixty seven (41,666,667) will be designated as Series B Preferred
Stock, of which seven million six hundred fifty seven thousand seventy three
(7,657,073) will be issued and outstanding immediately prior to the Initial
Closing Date, and an additional thirty four million nine thousand five hundred
ninety three (34,009,593) shares of which will have been committed to be sold by
the Company immediately prior to the Initial Closing Date and (iii) one million
nine hundred sixty seven thousand seven hundred fifty four (1,967,754) will be
designated as Series B-1 Preferred Stock, of which no shares will be issued and
outstanding immediately prior to the Initial Closing Date, but all of which will
have been committed to be sold by the Company immediately prior to the Initial
Closing Date. To our knowledge, except for the three million seven hundred
ninety eight thousand five hundred forty four (3,798,544) options outstanding
immediately prior to the Initial Closing Date, except for the conversion
privileges of the Series A Preferred Stock, Series B Preferred Stock and Series
B-1 Preferred Stock, except for the shares of Series B Preferred Stock to be
purchased pursuant to the Series B Preferred Stock Purchase Agreement dated as
of December 6, 1999 among the Company and the Purchasers listed on the schedule
of purchasers attached thereto,
1
67
as amended by Amendment No. 1 thereto dated as of December 31, 1999, and except
as disclosed in the Agreements or the exhibits or schedules attached thereto,
there are no options, warrants, conversion privileges, preemptive rights, rights
of first refusal or other rights to purchase from the Company any of its equity
securities that are outstanding immediately prior to the Initial Closing Date.
3. All the shares of capital stock of the Company outstanding prior to the
Initial Closing Date have been duly authorized, validly issued and are fully
paid and nonassessable. The rights, preferences and privileges of the Series
B/B-1 Preferred Stock are as stated in the Certificate of Incorporation.
4. To our knowledge, Schedule 4.12 to the Purchase Agreement sets forth the
current ownership structure of the Company and its Subsidiaries.
5. Each of the Agreements has been duly authorized, validly executed and
delivered by the Company and is a valid and binding agreement of the Company,
enforceable against the Company in accordance with its terms, except as rights
to indemnity under Section 2.5 of the Investors Agreement may be limited by
applicable laws and public policy and except as enforcement may be limited by
applicable bankruptcy, insolvency, reorganization, arrangement, moratorium or
other similar laws affecting creditors' rights, and subject to general equity
principles and to limitations on availability of equitable relief, including
specific performance.
6. The issuance, sale and delivery of the Series B/B-1 Preferred Stock
pursuant to the Purchase Agreement has been duly authorized by the Company and,
upon delivery to the Purchasers against payment therefor in accordance with the
Purchase Agreement and the terms of the Series B/B-1 Preferred Stock, the shares
of Series B/B-1 Preferred Stock will be validly issued, fully paid and
nonassessable.
7. The shares of Common Stock to be issued upon conversion of the Series
B/B-1 Preferred Stock have been duly authorized and reserved for issuance by the
Company and, when issued and delivered upon conversion of the Series B/B-1
Preferred Stock in accordance with the Certificate of Incorporation, such shares
of Common Stock will have been validly issued and will be fully paid and
nonassessable.
8. The execution of the Agreements by the Company, the compliance by the
Company with the terms thereof, and the offer and sale of the Series B/B-1
Preferred Stock pursuant to the Purchase Agreement (a) do not and will not
violate any provision of the Company's Certificate of Incorporation or Bylaws,
and (b) do not violate or contravene (i) the laws of the State of Colorado, the
General Corporation Law of the State of Delaware or any Federal law of the
United States of America applicable to the Company or (ii) any order, writ,
judgment, injunction, decree, determination or award which has been entered
against the Company and of which we have knowledge, the default, violation or
contravention of which would materially and adversely affect the Company, its
assets, financial condition or operations.
2
68
9. All consents, approvals, authorizations or orders of, and filings,
registrations, and qualifications with, any regulatory authority or governmental
body in the United States required for the consummation by the Company of the
transactions contemplated by the Purchase Agreement have been made or obtained,
except for any filings required under federal or state securities laws, and
except for any filings required under the Xxxx-Xxxxx-Xxxxxx Antitrust
Improvements Act of 1976, as amended.
10. To our knowledge, there is no suit, action, claim, arbitration or
similar proceeding or investigation pending or threatened against the Company or
against the Company's business or assets which, if adversely resolved, would be
reasonably likely to have a Material Adverse Effect.
11. Subject to the accuracy of the Purchasers' representations in Section 4
of the Purchase Agreement and assuming all required filings are made under
federal and state securities laws, the offer, sale and issuance of the Series
B/B-1 Preferred Stock pursuant to the Purchase Agreement constitutes a
transaction exempt from the registration requirements of Section 5 of the
Securities Act of 1933, as amended (the "Securities Act") and from the
securities registration requirements of the Colorado securities laws. In
addition, subject to the accuracy of the Purchasers' representations in Section
4 of the Purchase Agreement, assuming such securities are not being exchanged in
a case under title 11 of the United States Code, and assuming no commission or
other remuneration is paid or given directly or indirectly for soliciting such
exchange, the issuance of the Common Stock issuable upon conversion of the
Series B/B-1 Preferred Stock would also constitute a transaction exempt from the
registration requirements of Section 5 of the Securities Act and from the
securities registration requirements of the Colorado securities laws.
3
69
SCHEDULES TO
VELOCOM/FOLLOW-ON SERIES B PREFERRED STOCK PURCHASE
AGREEMENT
70
KEY TO SCHEDULES TO FOLLOW-ON SERIES B STOCK PURCHASE
AGREEMENT
Argentina LLC Formus Communications - Argentina LLC
Xxxx Canada Xxxx Canada International
Bolivia LLC Formus Communications - Bolivia LLC
Brasil Holdings VeloCom Cayman Brasil Holdings (formerly WLL Cayman
S.P. Company)
Centennial Centennial Fund V, Centennial Entrepreneurs Fund
and Centennial Holdings
Centennial Entrepreneurs Fund Centennial Entrepreneurs Fund V, L.P.
Centennial Fund V Centennial Fund V, L.P.
Centennial Holdings Centennial Holdings I, LLC
Chile Holdings VeloCom Cayman Chile Holdings
Chile LLC Formus Communications - Chile LLC
Colombia Holdings VeloCom Cayman Colombia Holdings
Colombia LLC Formus Communications - Colombia LLC
Crescendo Eagle Ventures, Crescendo World Fund and Crescendo
III
Crescendo III Crescendo III, L.P.
Crescendo World Fund Crescendo World Fund, LLC
Eagle Ventures Eagle Ventures WF, LLC
Formus Formus Communications Inc.
Formus Argentina Formus X.X.
Xxxxxx Bolivia Formus Bolivia S.A.
i
71
Formus Chile Formus Comunicaciones de Chile Limitada
Formus Colombia Formus Colombia S.A. E.S.P.
Xxxxxx XX Xxxxxx Communications - Latin America LLC
Formus Peru Formus Peru X.X.
Xxxxxx Venezuela Telecomunicaciones Interactivas de Venezuela C.A.
Interloop BVI Interloop Americas Inc.
Interloop Colombia Interloop S.A. Nacional de Telecomunicaciones E.S.P.
MegaTel Vesper Sao Paulo S.A. (formerly MegaTel do Brasil
S.A.)
PCN PCN Investment S.A.
Peru LLC Formus Communications - Peru LLC
Qualcomm XXXXXXXX Xxxxxxxxxxxx
Qualcomm Brasil QUALCOMM do Brasil S.A.
SLI SLI Wireless S.A.
Smartel Smartel S.A.
Taquari Taquari Participacoes S.A.
Telecom Telecom Partners II, L.P.
Telelatina Telelatina S.A.
TMC Telelatina Management Company LLC
VeloCom VeloCom Inc. (also referred to as the "Company")
VeloCom Argentina VeloCom SRL
VeloCom Brasil VeloCom do Brasil Ltda. (formerly WLL Brasil
Holdings, Ltda.)
ii
72
VeloCom Chile WLL International Chile Ltda.
Venezuela LLC Formus Communications - Venezuela LLC
Xxxxxx Xxxxxx (formerly Mirror S.A. and/or Canbra
Telefonica, S.A.)
Vesper Cayman Vesper Cayman
Vesper Sao Paulo Cayman Vesper Sao Paulo Cayman, Ltd.
Vesper Holding Vesper Holding S.A. (formerly Mirror Holding S.A.
and/or Canbra Holding S.A.)
Vesper Sao Paulo Holding Vesper Sao Paulo Holding S.A. (formerly MegaTel
Holding S.A.)
WLL Argentina WLL Argentina SRL
iii
73
INDEX OF SCHEDULES
4.4 Consents and Approvals
4.5(a) Compliance With Laws
4.5(b) Material Permits
4.6 Patent and Trademark Rights
4.8 Contracts
4.12 Subsidiaries
4.13 Capitalization of Subsidiaries
4.14(a) Share Ownership of Company
4.14(b) Agreements Relating to Equity Interests in Companies
4.18 Licenses
4.20 Liabilities
4.22(a) Collective Bargaining Agreements or Employment Agreements
Not Terminable at Will
4.22(b) Employees and Directors of the Company
4.23 Employee Benefit Plans
4.24 Recordkeeping Compliance
iv
74
SCHEDULE 4.4
CONSENTS AND APPROVALS
VELOCOM
Filing of Form D with the United States Securities and Exchange
Commission and applicable state securities authorities will be required
post-Closing.
1
75
SCHEDULE 4.5(a)
COMPLIANCE WITH LAWS
VELOCOM CHILE
VeloCom Chile (a non-operating company with no assets) has not filed
certain monthly tax reports with Chilean tax authorities. The Company
is in the process of making such filings.
INTERLOOP COLOMBIA
Interloop Colombia has not made certain payments in respect of its
license obligations, the result of which could be a loss of this
entity's license. In addition, the buildout requirements in respect of
this license have not been fully complied with. Interloop Colombia has
also not complied with all legal requirements relating to its financial
statements.
1
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SCHEDULE 4.5(b)
MATERIAL PERMITS
VESPER HOLDING
Vesper Holding was registered with Brazilian Federal tax authorities
under registration No. 02.763.387/0001-6.
VESPER SAO PAULO HOLDING
Vesper Sao Paulo Holding was registered with Brazilian Federal tax
authorities under registration No. 03.008. 468/0001-10.
VESPER
1. Termo de Autorizacao do Servico Telefonico Fixo Comutado, Modalidade
Local, Que Entre Si Celebram A Agencia Nacional de Telecomunicacoes -
ANATEL e Vesper.
2. Termo de Autorizacao do Servico Telefonico Fixo Comutado, Modalidade
Longa Distancia Nacional de Ambito Intra-Regional, Que Entre Si
Celebram A Agencia Nacional de Telecomunicacoes - ANATEL e Vesper.
3. Vesper was registered with Brazilian Federal and State tax
authorities under registrations No. 02.730.101/0001-4 and 85297791,
respectively.
4. License for Packet Switched Network Services issued by Anatel on
September 23, 1999.
5. License for Circuit Switched Network Services issued by Anatel on
September 23, 1999.
6. License for Dedicated Line Services issued by Anatel on September
23, 1999.
7. License for Special Services of Audio and Video Signal
Retransmission issued by Anatel on September 23, 1999.
8. License for Network Transport issued by Anatel on September 23,
1999.
MEGATEL
1. Termo de Autorizacao do Servico Telefonico Fixo Comutado, Modalidade
Local, Que Entre Si Celebram A Agencia Nacional de Telecomunicacoes -
ANATEL e MegaTel.
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77
2. Termo de Autorizacao do Servico Telefonico Fixo Comutado, Modalidade
Longa Distancia Nacional de Ambito Intra-Regional, Que Entre Si
Celebram A Agencia Nacional de Telecomunicacoes - ANATEL e MegaTel.
3. MegaTel was registered with Brazilian Federal and State tax
authorities under registrations No. 02.629.188/0001-6 and
115.322.817.110, respectively.
4. License for Packet Switched Network Services issued by Anatel on
September 23, 1999.
5. License for Circuit Switched Network Services issued by Anatel on
September 23, 1999.
6. License for Dedicated Line Services issued by Anatel on September
23, 1999.
7. License for Special Services of Audio and Video Signal issued by
Anatel on September 23, 1999.
8. License for Retransmission issued by Anatel on September 23, 1999.
9. Liceneca para transporte de dados - ANATEL ("data transport license"
under analysis regarding all possible applications)
TELELATINA
1. By Resolution 2617SC/97 issued by the Secretary of Communications on
September 4, 1997, Telelatina was granted a license to provide Value
Added Services, Data Transmission Services and Videoconferencing
services nationwide.
2. By Resolution 3064SC/97, issued by the Secretary of Communications
on October 15, 1997, Telelatina was granted an authorization to use,
the frequency bandwidth from 3,450 MHz to 3,475 MHz. and from 3,550
MHz. to 3,575 MHz. The use of these frequencies is governed by
Resolution 2879SC/97 as amended by 869SC/98.
3. Telelatina has obtained the National Communications Commission's
authorization to install and operate two microwave links, and is in the
process of obtaining authorization for various other microwave links.
4. Telelatina has filed a petition with the National Communications
Commission to obtain authorization to install eight cells within the
City of Buenos Aires.
2
78
SMARTEL
1. By Resolution 1130SC/98 issued by the Secretary of Communications on
May 7, 1998, Smartel was granted a license to provide Value Added
Services, Data Transmission Services, Broadcasting signals carriage
services and Videoconferencing services.
2. By Resolution 1247SC/98, issued by the Secretary of Communications
on May 22, 1998, Smartel was granted an authorization to use, for the
AMBA (which area comprises the City of Buenos Aires and certain
locations nearby), Xxxxxxx, Cordoba and Xxxxxxx the frequency bandwidth
from 26,850 GHz to 27,350 GHz. and from 31,075 GHz. to 31,150 GHz. The
use of these frequencies is governed by Resolution 869SC/98, as
amended.
FORMUS ARGENTINA
Bands: E Band which totals 575 MHz and consists of the following
frequencies: 25.85 to 26.35 GHz and 29.175 to 29.25 GHz (awarded
November 1998). This spectrum assignment may initially be used only in
the following cities: AMBA (Area Multiple Buenos Aires), La Plata and
Cordoba. Services: Data transmission, value added and videoconferencing
(awarded September and November 1998).
FORMUS COLOMBIA
Bands: 300 MHz at 38 GHz; channels 13, 14, 17 (awarded November 1998).
The license fees for the 38 GHz spectrum license has been increased
from approximately US$222,000 to approximately US$534,000. This
increase is effective for the year 2000 payment due January 2000.
Services: Local carrier and value added (awarded August 1998 and May
1999)
FORMUS PERU
Bands: 400 MHz at 38 GHz; channels 1-4 (awarded May 1999).
Services: Local carrier and value added (awarded April 1999).
INTERLOOP COLOMBIA
1. License to provide Basic Commuted Telephone Services in Colombia.
Such license was granted by Resolution 4262 issued on 9/23/97, expiring
on 12/23/2007, the scope of this license shall be for the territory of
Santa Fe de Bogota, DC (Departamento de Curdinamarca), Cali
(Departamento de Xxxxx del Cauca), Medellin (Departamento de
Antioquia), Barranquilla (Departamento de Atlantico), Bucaramanga
(Departamento de Santander), Cartagena (Departamento xx Xxxxxxx), Santa
Xxxxx (Departamento de Xxxxxxxxx), Pereira (Departamento
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de Risaralda), Cucuta (Departamento del Norte de Santander) y
Villavicencio (Departamento del Meta).
2. License to provide Telematics and Value Added Services, and the
constitution of an Associate Value Added Service Network, which was
granted by Resolution 4472 issued on 10/10/97 expiring on 10/10/2007.
3. Interloop Colombia was authorized to use the radioelectric spectrum
as per Resolution 5195 issued on 29/12/97. By Resolution 106 of 1999,
Interloop was authorized to use exclusively bands 23 y 3.4 GHz within
the cities where it had been awarded with a license until 9/22/2007.
ODECAR S.A.
1. Odecar S.A. was assigned, on December 14, 1999, per Resolution No.
404.99 of the Direccion Nacional de Comunicaciones of Uruguay, the
radioelectric sub-blocks 24.600 GHz - 24.850 GHz in Montevideo and
25,100 GHz - 25.350 GHZ, 25.600 GHZ - 25.850 GHz and 26.100 GHz -
26.350 GHz in Xxxxxxxxx for use in providing commercial data
transmission service.
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SCHEDULE 4.6
PATENT AND TRADEMARK RIGHTS
VELOCOM
1. Applications for trademark for "VELOCOM" and "VESPER" have been
filed in:
Argentina
Bolivia
Brazil (VeloCom only)
Colombia
Chile
Mexico
Paraguay
Peru
Uruguay
Venezuela
United States of America
All applications are pending.
2. Applications for trademark for "VELOCOMM" have been filed in:
Argentina
Brazil
Colombia
Chile
Mexico
Peru
Uruguay
Venezuela
United States of America
All applications have been abandoned or will be abandoned.
3. The domain name "VELOCOM" has been secured by the Company.
VESPER
1. Applications for the following trademarks have been filed in Brazil:
"XXXXXXX"
"ATIMO"
"VESPER"
All applications are pending.
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TMC
1. Trademark application for:
Application No. 2.210.763 filed on March 29, 1999 to cover all
services in International Class 38. This application has encountered
an opposition by Radio Mitre S.A. on the basis of the trademark
"XXXXXX LATINA," Registration No. 1.675.177 in International Class
38.
2. Trademark application for:
Application No. 2.210.764 filed on March 29, 1999 to cover all
services in International Class 38.
3. Trademark application for:
Application No. 2.210.765 filed on March 29, 1999 to cover all
services in International Class 38.
4. Trademark application for "TMC": Application No. 2.210.766 filed on
March 29, 1999 to cover all services in International Class 38. This
application has encountered an opposition by T.M.C. Learreta y Xxxxxxx
X.X., Xxxxxxx, Xxxxxxxx Xxxx / Learreta, Xxxxxxxx, on the basis of
their trademark "TMC COMPUTACION", Registrations Nos. 1.661.729 granted
on March 23, 1998 covering all services in International Class 42, and
1.666.293 granted on April 24, 1998 covering all goods in International
Class 9.
TELELATINA
1. Trademark application for "LATINWAY": international class No. 38
(minutes 2,173,040) filed on September 2, 1998, and published in the
Trademark Bulletin on October 28, 1998. This application has
encountered an opposition by Miniphone S.A. based on its trademark
"LATINNET (COMUNICACIONES PERSONALES LATINOAMERICANAS)" Registration
No. 1.576.565 of international class 38.
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2. Trademark application for "LATINCOM": international class No. 38
(minutes 2,173,041) filed on September 2, 1998, and published in the
Trademark Bulletin on October 28, 1998. This application has
encountered an opposition by Miniphone S.A. based on its trademark
"LATINNET (COMUNICACIONES PERSONALES LATINOAMERICANAS)" Registration
No. 1.576.565 of international class 38.
3. Trademark application for "LATINLINK": international class No. 38
(minutes 2,173,038) filed on September 2, 1998, and published in the
Trademark Bulletin on October 28, 1998. This application has
encountered an opposition by Miniphone S.A. based on its trademark
"LATINNET (COMUNICACIONES PERSONALES LATINO-AMERICANAS)" Registration
No. 1.576.565 of international class 38.
4. Trademark application for "LATINDATA", international class No. 38
(minutes 2,173,039) filed on September 2, 1998, and published in the
Trademark Bulletin on October 28, 1998. This application has
encountered an opposition by Miniphone S.A. based on its trademark
"LATINNET (COMUNICACIONES PERSONALES LATINOAMERICANAS)" Registration
No. 1.576.565 of international class 38.
5. Trademark application for "TELELATINA" and logo:
Application No. 2.198.589 filed on January 20, 1999 to cover all
services in International Class 38. This application has encountered an
opposition by Radio Mitre S.A. on the basis of their trademark "XXXXXX
LATINA", Registration No. 1.675.177, in International Class 38.
6. Please note that according to the Trademarks Office database
FEDERACION DE COOP. DE TELECOMUNICACIONES DE LA REP. ARG. LTDA owns the
trademark application of "TELELATINA", Application No. 2.091.831, filed
on July 14, 1997, to cover all services in Int. Class 38.
7. Trademark application for "ICONWEB": application No. 2.210.176,
filed by Xx. Xxxxxx Xxxxx de Dios on March 25, 1999, to cover all
services in International Class 38. This application did not encounter
oppositions by third parties. This application trademark is in process
of being assigned by Xx. Xxxxxx Xxxxx de Dios in favor of Telelatina
8. Trademark application for "WIDENET": application No. 2.210.177,
filed by Xx. Xxxxxx Xxxxx de Dios on March 25, 1999, to cover all
services in International Class 38. This application did not encounter
oppositions by third parties. This application trademark is in process
of being assigned by Xx. Xxxxxx Xxxxx de Dios in favor of Telelatina.
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9. Trademark application for "XXXXXXX.XXX": application No. 2.217.827,
filed by Xx. Xxxxxx Xxxxx de Dios on May 6, 1999, to cover all services
in International Class 38. This application has been published in the
Trademark Bulletin for opposition purposes. The term to oppose this
trademark expires on August 27, 1999. Please note that the following
applications have not yet been published for opposition purposes. This
application trademark is in process of being assigned by Xx. Xxxxxx
Xxxxx de Dios in favor of Telelatina.
10. Trademark application for "W": application No. 2.222.712, filed by
Xx. Xxxxxx Xxxxx de Dios on June 4, 1999, to cover all services in
International Class 38. This application trademark is in process of
being assigned by Xx. Xxxxxx Xxxxx de Dios in favor of Telelatina.
11. Trademark application for "WIDENET W": application No. 2.223.045,
filed by Xx. Xxxxxx Xxxxx de Dios on June 7, 1999, to cover all
services in International Class 38. This application trademark is in
process of being assigned by Xx. Xxxxxx Xxxxx de Dios in favor of
Telelatina.
12. Trademark application for "WIDENET": application No. 2.223.046,
filed by Xx. Xxxxxx Xxxxx de Dios on June 7, 1999, to cover all
services in International Class 38. This application trademark is in
process of being assigned by Xx. Xxxxxx Xxxxx de Dios in favor of
Telelatina.
13. Trademark application for "I": application No. 2.230.853, filed by
Xx. Xxxxxx Xxxxx de Dios on July 26, 1999, to cover all services in
International Class 38. This application trademark is in process of
being assigned by Xx. Xxxxxx Xxxxx de Dios in favor of Telelatina.
SMARTEL
1. Trademark application for "SMARTEL": Application No. 2.196.692,
filed on January 8, 1999, to cover all goods in International Class 9.
This application has encountered oppositions by: a) TELEFONICA DE
ARGENTINA S.A., on the basis of "SMART-NET", Application No. 2.113.255,
filed on November 7, 1997, to cover all services in International Class
38; b) STARTEL S.A., on the basis of "STARTEL", Registration No.
1.574.537, granted on September 7, 1995, covering all goods in
International Class 9, and on the basis of their corporate name
STARTEL; and c) DATCO S.A., on the basis of "SMARTTIME", Registration
No. 1.608.708, granted on July 29, 1996 to cover all goods in
International Class 9.
2. Trademark application for "SMARTEL": Application No. 2.196.693,
filed on January 8, 1999, to cover all services in International Class
38. This application encountered oppositions by: a) TELEFONICA DE
ARGENTINA S.A., on the basis of "SMART-NET", Application No. 2.113.255,
filed on November 7, 1997 to cover all services in International Class
38; and b) STARTEL S.A., on the
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basis of "STARTEL S.A. SERVICIOS ARGENTINOS DE TELECOMUNICACIONES",
Registration No. 1.574.520, granted on September 7, 1995 covering all
services in International Class 38, and on the basis of their corporate
name STARTEL.
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SCHEDULE 4.8
CONTRACTS
VELOCOM
1. Equity Subscription Agreement dated as of June 30, 1998 between the
Company, Telecom Partners, Centennial Fund V, Centennial Entrepreneurs
Fund, Centennial Holdings I, IAI World Fund, L.L.C., Eagle Ventures,
Xxxx X. Xxxxxx, Xxxxxx XxXxxxxx and Xxx Xxxxx, as amended by the First
Amendment to the Seed Round Agreement dated January 6, 1999, and the
Second Amendment to the Seed Round Agreement dated May 21, 1999.
2. Letter Agreement dated as of December 4, 1998 between the Company,
Telecom, Centennial, Crescendo World Fund, Eagle Ventures, Xxxx X.
Xxxxxx, Xxxxxx XxXxxxxx, Xxx Xxxxx, Xxxxx X. Xxxxxxx and Xxxx Xxxxxx.
3. Irrevocable Equity Contribution Agreement dated December 7, 1998 by
and among the Company, Telecom, Crescendo World Fund and Centennial.
4. Security Agreement dated December 8, 1998 by and among Telecom,
Centennial Fund V and Crescendo World Fund.
5. Letter Agreement dated December 8, 1998 by and among Telecom,
Centennial Fund V and Crescendo World Fund.
6. Control Agreement dated December 8, 1998 by and among Crescendo
World Fund, Centennial Fund V, Telecom, BankBoston, N.A. and Boston
1784 Funds.
7. Equity Subscription Agreements between the Company and each of
Xxxxxxx Xxxxxx, Xxxxx Xxxxxxx, R. Xxxxxx House, REINCO Corp., Xxxxxxx
X. Xxxxx, C. Xxxxx Xxxxx, Xxxxxxx Xxxxxxxxxx, North River Ventures,
Inc. Pension Plan, Xxxxxxx XxXxxxxxx, Xxxxxxxx Xxxx, Xxxx Xxxxxxx, Xxxx
Xxxxx, Xxxxxxx Xxxxxxxxx, Xxxxx Xxxxxxx and Xxxxx Xxxxx.
8. Joinder Agreements between the Company and each of R. Xxxxxx House,
REINCO Corp., Xxxxxxx Xxxxxx, Xxxxxxx X. Xxxxx, Xxxxxxxx Xxxx, Xxxx
Xxxxxxx and Xxxxx Xxxxx.
9. Series A Preferred Stock Purchase Agreement dated as of January 26,
1999 between the Company, Telecom, Centennial and Crescendo.
10. Pro Rata Letter Agreements dated as of March 31, 1999 between the
Company and each of Telecom, Centennial, Crescendo, REINCO Corp., C.
Xxxxx Xxxxx, R. Xxxxxx House, Xxxxxxx Xxxxxx, Xxxxx X. Xxxxxxx, Xxxxxx
XxXxxxxx, Xxxxxxx X. Xxxxxx and Xxxxx X. Xxxxxx.
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11. Second Irrevocable Equity Contribution Agreement dated as of April
16, 1999 between the Company, Telecom, Crescendo, Centennial, Xxxxx X.
Xxxxxxx, Xxxxxxx X. Xxxxxx, Xxxx X. Xxxxxx, Xxxxxx XxXxxxxx, C. Xxxxx
Xxxxx, R. Xxxxxx House and Xxxxxxx Xxxxxx.
12. Second Series A Preferred Stock Purchase Agreement dated as of May
7, 1999 between the Company, Telecom, Crescendo, Centennial, Xxxxx X.
Xxxxxxx, Xxxxxxx X. Xxxxxx, Xxxx X. Xxxxxx, Xxxxxx XxXxxxxx, C. Xxxxx
Xxxxx, R. Xxxxxx House and Xxxxxxx Xxxxxx.
13. Employment Letters between the Company and each of Xxxxx Xxxxxxx,
Xxxxxxx Xxxxxxxxx, Xxxxx Xxxxxxx, Xxxxx Xxxxxx, Xxxxxxx Xxxxxxx, Xxxx
Xxxxx, Xxxxxxxx Xxxxxxxx, R. Xxxxxx House, Xxxx Xxxxx, Xxxxxxx Xxxxx,
Xxxxx Xxxxx, Xxxxxxx Xxxxxx, Xxxxx Xxxxxxxxx, Xxxx Xxxxxx, Xxxxx
Xxxxxx, Xxxxxxx Xxxxxx, Xxxx Xxxxxxx, Diego Xxxxxxxxx, Xxxxxxxxx
("Xxxxxx") Xxxxxxx, Xxxx Xxxxxxx, Xxxx Xxxxxxxx, Xxxxxxx Xxxxxxxxx,
Xxxx Xxxxx, Xxxxx Xxxxxx, and Xxxxx Xxxxxx.
14. Stock Option Agreements between the Company and each of Xxxxx
Xxxxxxx (10/1/98), Xxxxx Xxxxxxx (10/1/98), Xxxxx Xxxxxxx (5/21/99),
Xxxxxxx Xxxxxx (10/1/98), Xxxxxxx Xxxxxx (5/21/99), Xxxxxxxx Xxxx
(4/12/99), Xxxxxxxx Xxxx (5/21/99), Xxxxxxxx Xxxx (5/21/99), Xxxxx
Xxxxx (7/12/99); Xxxxx Xxxxx (7/12/99), Xxxx Xxxxx (12/7/98), Xxxx
Xxxxx (5/21/99), Xxxx Xxxxx (5/21/99), Xxxxxxx Xxxxx (7/16/99), Xxxxxxx
Xxxxx (7/16/99), Xxxx Xxxxxx (12/7/98), Xxxx Xxxxxx (5/21/99), Xxxx
Xxxxxx (5/21/99), R. Xxxxxx House (1/4/99), R. Xxxxxx House (5/21/99),
R. Xxxxxx House (5/21/99), Xxxxxxx Xxxxxxx (3/15/99), Xxxxxxx Xxxxxxx
(5/21/99), Xxxxx Xxxxxxx (6/7/99), Xxxxxxxx Xxxxxxxx (4/1/99), Xxxxx
Xxxxxx (10/5/98), Xxxxx Xxxxxx (12/7/98), Xxxxx Xxxxxx (5/21/99), Xxxxx
Xxxxx (5/21/99), Xxxx Xxxxx (3/8/99), Xxxx Xxxxx (5/21/99), Xxxx
Xxxxxxx (5/3/99), Xxxx Xxxxxxx (5/21/99), Xxxx Xxxxxxx (5/21/99),
Xxxxxxx Xxxxxxxxx (7/11/99), Xxxxx Xxxxxx (6/1/99), Xxxxx Xxxxxx
(6/1/99), Xxxx Xxxxxx (9/17/98), Xxxx Xxxxxx (5/21/99), Xxxxxxx
Xxxxxxxxx (6/18/99), Xxxxx Xxxxxxxxx (8/1/99), Xxxxxxx Xxxxxx (8/1/99),
Xxxxx Xxxxxxxx (10/1/99), Xxxxx Xxxxxxxx (10/1/99), Xxxx Xxxxxxxx
Xxxxxx (10/1/99), Xxx XxXxxxxx (5/21/99), Xxx XxXxxxxx (9/17/98), Xxxxx
Xxxxxxxx (5/21/99), Xxxxx Xxxxxx (7/16/99).
15. Engagement Letter dated March 11, 1999 by and between the Company
and Xxxxxx Brothers.
16. Engagement Letter dated March 15, 1999 by and between the Company
and TD Securities (USA) Inc.
17. Engagement Letter dated March 15, 1999 by and between the Company
and Xxxxxxxxx, Lufkin & Xxxxxxxx Securities Corporation.
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18. Engagement Letter dated July 12, 1999 by and between the Company
and Xxxxxx & Xxxxxxxxx LLC as amended.
19. Oral Agreement between the Company and Straight Marketing to
provide marketing and consulting services.
20. Multiparty Non-Disclosure Agreement, between Qualcomm Brasil, the
Company and Qualcomm, dated November 4, 1998.
21. Joint Bidding Agreement, between the Company and Qualcomm Brasil,
dated November 9, 1998.
22. Memorandum of Understanding between the Company, Xxxx Canada,
Taquari, and Qualcomm Brasil, dated December 8, 1998.
23. Option Agreement between the Company, Xxxx Canada, Taquari, SLI,
BID S.A. and Qualcomm Brasil, dated January 15, 1999.
24. Multiparty Non-Disclosure Agreement, between Qualcomm Brasil, Xxxx
Canada, the Company, Taquari, SLI and BID S.A., dated January 20, 1999.
25. Memorandum of Understanding, between the Company, Xxxx Canada, SLI
and Qualcomm Brasil, dated March 15, 1999.
26. Letter of Agreement, between the Company, Xxxx Canada, SLI and
Qualcomm Brasil, dated May 4, 1999.
27. Second Letter of Agreement, between the Company, Xxxx Canada, SLI
and Qualcomm Brasil, dated May 26, 1999.
28. Purchase Agreement by and among Formus, Formus International, Inc.
and the Company dated as of August 20, 1999.
29. Subscription Agreement between Formus and the Company dated August
20,1999.
30. Consolidation Agreement by and among SLI, Sociedad Latinoamericana
S.A., Brasil Holdings and the Company dated as of August 20, 1999.
31. Subscription Agreement between SLI and the Company dated August 20,
1999.
32. Purchase Agreement between Taquari and the Company dated as of
August 20, 1999.
33. Subscription Agreement between Taquari and the Company dated August
20, 1999.
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34. Amended and Restated Investors Agreement dated as of September 27,
1999 between the Company and its principal stockholders.
35. Purchase Agreement between the Company and PCN do Brasil S.A. dated
as of September 27, 1999.
36. Purchase Agreement between the Company and Inepar S.A. dated as of
September 27, 1999.
37. Pledge Agreement dated September 27, 1999 between the Company and
PCN do Brasil S.A.
38. Escrow Agreement dated September 27, 1999 between the Company, PCN
do Brasil S.A. and Bank Boston S.A.
39. Letter Agreement dated August 23, 1999 between the Company and SLI
in respect of the bid for Region II in Brazil.
40. Joint Bidding Agreement dated August 25, 1999 between the Company,
Xxxx Canada and Qualcomm in respect of the bid for Region II in Brazil.
41. Consent and Agreement dated September 22, 1999 between the Company
and its affiliates, SLI and its affiliates, Qualcomm and its
affiliates, Taquari and its affiliates and Xxxx Canada and its
affiliates.
42. Equity Investment Agreement dated October 21, 1999 between the
Company and certain of its stockholders.
43. Affiliate Agreement made as of November 9, 1998 between Telecom
Management II LLC and the Company (Lease Agreement relating to the
Company's premises at 0000 Xxxxx Xxxxxxxx Xxxxx Circle).
44. Capital Contribution Agreement executed by the Company and Brasil
Holdings dated December 13, 1999 in favor of ABN Amro as agent for
certain lenders.
45. Additional Capital Contribution Agreement executed by the Company
and Brasil Holdings dated December 13, 1999 in favor of ABN Amro as
agent for certain lenders.
46. Two Support Obligations dated December 13, 1999, to be executed by
the Company in respect of the Capital Contribution Agreement and
Additional Capital Contribution Agreement referred to in items numbered
45 and 46 above.
47. Side Letter dated December 13, 1999 to be executed by the Company
VeloCom Brasil and Brasil Holdings in respect of the Additional Capital
Contribution Agreement referred to in item 46 above.
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48. Commitment Letter dated as of August 10, 1999 from Nortel Networks
Corporation, Northern Telecom do Brasil Comercio e Servicos Ltda. and
Northern Telecom do Brasil Industria e Comercio Ltda. to Xxxx Canada
International (Brazil Telecom 1) Limited, SLI, Qualcomm Brasil,
Taquari, VeloCom Brasil, Vesper, Xxxx Canada, VeloCom, Qualcomm, Rio
Purus Participacoes Ltda., CFL Participacoes Ltda., Xxxxxx Xxxxxxxx and
Xxxxxxxxx Xxxxxxxx.
49. Letter Agreement dated August 10, 1999 by and among Nortel Networks
Corporation, Northern Telecom do Brasil Comercio e Servicos Ltda. and
Northern Telecom do Brasil Industria e Comercio Ltda., Xxxx Canada
International (Brazil Telecom 1) Limited, SLI, Qualcomm Brasil,
Taquari, VeloCom Brasil, Vesper, Xxxx Canada, VeloCom, Qualcomm, Rio
Purus Participacoes Ltda., CFL Participacoes Ltda., Xxxxxx Xxxxxxxx and
Xxxxxxxxx Xxxxxxxx.
50. Technical Assistance Agreement between the Company and Formus
International dated September 27, 1999.
51. Management Rights Agreement dated October 28, 1999 between the
Company and Crescendo III.
52. Assignment and Assumption Agreement between Formus International
Inc. and the Company dated September 27, 1999 in connection with a
certain Uruguay LMDS development project.
53. Consulting Agreement dated October 22, 1999, by and between
Xxxxxxxxx Xxxxx and the Company.
54. Loan Agreement dated as of November 19, 1999 among the Company, as
borrower, and Telecom Partners II, L.P., Crescendo World Fund, L.L.C.,
Eagle Ventures WF, LLC, Crescendo III, L.P., Crescendo III, GbR,
Crescendo III Executive Fund, L.P., Centennial Fund V., L.P.,
Centennial Holdings I, LLC, SLI Wireless S.A., Formus Communications -
Latin America Holdings, LLC.
55. Term sheet between BankAmerica International Investment Corporation
and the Company dated December 1, 1999.
56. Purchase Agreement dated December 6, 1999 between the Company and
the investors listed therein.
57. Second Amended and Restated Investors Agreement between the Company
and the stockholders listed therein.
58. Memorandum of Understanding between the Company, Ejemil S.A.,
Odecar S.A., Xx. Xxxxx Xxxxxxx Xxxxxxx and El Pais S.A. dated November
29, 1999.
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59. Letter of Intent between the Company, Xxxx Canada International,
BRHS S.A. and Xxxxxxx Xxxx Xxxxxxx xx Xxxxxx dated December 21, 1999.
60. Escrow Agreement between the Company, Xxxx Canada International,
BRHS S.A. and Xxxxxxx Xxxx Xxxxxxx xx Xxxxxx and State Street Bank and
Trust Company dated December 21, 1999.
61. Amended and Restated Shareholders Agreement (Vesper Holding) dated
as of December 16, 1999 between the Company, Vesper Holding, Brasil
Holding, Xxxx Canada International and Qualcomm, and their affiliates.
62. Amended and Restated Shareholders Agreement (Vesper Sao Paulo
Holding) dated as of December 23, 1999 between the Company, Brasil
Holdings, Vesper Sao Paulo Holding, Xxxx Canada International and
Qualcomm, and their affiliates.
63. Shareholder Pledge Agreement in respect of the Nortel/Ericsson
Financing dated December 16, 0000 xxxxxxx Xxxx Xxxxxx International,
the Company, Qualcomm, BCI Brazil, Brasil Holdings, Qualcomm Brasil and
the Collateral Agent.
64. Sponsor Support Agreement (Lucent) dated December 27, 0000 xxxxxxx
Xxxxxx, Xxxx Xxxxxx International, Qualcomm, Brasil Holdings, the
Company and their affiliates.
65. Substitute Financing Letter dated December 27, 0000, xxxxxxx Xxxxxx
Xxx Xxxxx Xxxxxxx, Xxxxxx, Xxxx Xxxxxx International, Qualcomm, Brasil
Holdings, the Company and their affiliates.
66. Marketing Assistance Letter dated December 27, 0000 xxxxxxx Xxxxxx,
Xxxx Xxxxxx International, Qualcomm, Brasil Holdings, Vesper Sao Paulo
Holding, the Company and their Affiliates.
67. Memorandum of Understanding dated December 21, 1999 between the
Company and Xxxxxxxx Xxxxxxxxxxxx.
VELOCOM BRASIL
1. Commitment Letter dated as of August 10, 1999 from Nortel Networks
Corporation, Northern Telecom do Brasil Comercio e Servicos Ltda. and
Northern Telecom do Brasil Industria e Comercio Ltda. to Xxxx Canada
International (Brazil Telecom 1) Limited, SLI, Qualcomm Brasil,
Taquari, VeloCom Brasil, Vesper, Xxxx Canada, VeloCom, Qualcomm, Rio
Purus Participacoes Ltda., CFL Participacoes Ltda., Xxxxxx Xxxxxxxx and
Xxxxxxxxx Xxxxxxxx.
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2. Letter Agreement dated August 10, 1999 by and among Nortel Networks
Corporation, Northern Telecom do Brasil Comercio e Servicos Ltda. and
Northern Telecom do Brasil Industria e Comercio Ltda., Xxxx Canada
International (Brazil Telecom 1) Limited, SLI, Qualcomm Brasil,
Taquari, VeloCom Brasil, Vesper, Xxxx Canada, VeloCom, Qualcomm, Rio
Purus Participacoes Ltda., CFL Participacoes Ltda., Xxxxxx Xxxxxxxx and
Xxxxxxxxx Xxxxxxxx.
3. Shareholders Agreement between Taquari, SLI, Qualcomm Brasil, Xxxx
Canada, VeloCom Brasil and Vesper, dated February 4, 1999.
4. Option Agreement between Xxxx Canada and VeloCom Brasil, dated
February 4, 1999.
5. Agreement between VeloCom Brasil and Qualcomm Brasil, dated February
4, 1999, concerning Option Agreement.
6. Shareholders Agreement between Taquari, SLI, Qualcomm Brasil, Xxxx
Canada, VeloCom Brasil and Vesper Holding, dated February 4, 1999.
BRASIL HOLDINGS
1. Shareholders Agreement between SLI, Qualcomm Brasil, Xxxx Canada
International (MegaTel) Limited, Brasil Holdings and Vesper Sao Paulo
Holding dated as of July 30, 1999.
2. Option Agreement dated as of July 30, 1999 by and between Xxxx
Canada International (MegaTel) Limited and Brasil Holdings.
3. Capital Contribution Agreement to be executed by Brasil Holdings
dated December 13, 1999 in favor of ABN Amro as agent for certain
lenders.
4. Additional Capital Contribution Agreement to be executed by Brasil
Holdings dated December 13, 1999 in favor of ABN Amro as agent for
certain lenders.
5. Side Letter dated December 13, 1999 to be executed by the Company
and Brasil Holding in respect of the Additional Capital Contribution
referred to above.
6. Amended and Restated Shareholders Agreement (Vesper Holding) dated
as of December 16, 1999 between the Company, Vesper Holding, Brasil
Holdings, Xxxx Canada International and Qualcomm, and their affiliates.
7. Amended and Restated Shareholders Agreement (Vesper Sao Paulo
Holding) dated as of December 23, 1999 between the Company, Brasil
Holdings, Vesper Sao Paulo Holding, Xxxx Canada International, Qualcomm
and their affiliates.
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8. Shareholder Pledge Agreement in respect of the Nortel/Ericsson
Financing dated December 16, 0000 xxxxxxx Xxxx Xxxxxx International,
the Company, Qualcomm, BCI Brasil, Brasil Holdings, Qualcomm Brasil and
the Collateral Agent.
9. Substitute Financing Side Letter, dated December 27, 1999, among
Qualcomm, the Company, BCI, the Lenders and the Agents.
VESPER HOLDING
1. Shareholders Agreement between Taquari, SLI, Qualcomm Brasil, Xxxx
Canada, VeloCom Brasil and Vesper Holding, dated February 4, 1999.
2. Common Terms Agreement to be executed between Vesper, Vesper
Holding, ABN Amro and the lenders thereto dated December 13, 1999.
3. Amended and Restated Shareholders Agreement dated as of December 16,
1999 between the Company, Vesper Holding, Xxxx Canada, Brasil Holding,
Qualcomm, and their affiliates.
4. Capital Contribution Agreement dated December 13, 1999 between
Vesper Holding and the Collateral Agent (Nortel/Ericsson financing).
5. Stock Pledge Agreement in respect of stock of Vesper dated December
16, 1999 between Vesper Holding, and the Collateral Agent and related
powers of attorney.
6. Guaranty executed by Vesper Holding in respect of Vesper dated
December 16, 1999.
7. Shareholder Pledge Agreement and related filings dated December 16,
1999 executed by Vesper Holding.
VESPER SAO PAULO HOLDING
1. Shareholders Agreement between SLI, Qualcomm Brasil, Xxxx Canada
International (MegaTel) Limited, Brasil Holdings and Vesper Sao Paulo
Holding dated as of July 30, 1999.
2. Amended and Restated Shareholders Agreement between Qualcomm Brasil,
Xxxx Canada, Brasil Holdings, the Company, Vesper Sao Paulo Holding and
their affiliates dated as of December 23, 1999.
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3. Sponsor Support Agreement dated December 27, 1999 in respect of
Lucent financing.
4. Lucent Credit Agreement dated December 27, 1999 between Vesper Sao
Paulo Holding, Vesper Sao Paulo, and Lucent.
5. Common Agreement dated December 27, 1999 between Vesper Sao Paulo
Holding, Vesper Sao Paulo, Lucent and the Collateral Agent.
6. Pledge and Related Security Agreements in respect of the Lucent
financing referred to above.
VESPER
1. Termo de Autorizacao do Servico Telefonico Fixo Comutado, Modalidade
Local, Que Entre Si Celebram A Agencia Nacional de Telecomunicacoes -
ANATEL e Canbra Telefonica S.A.
2. Termo de Autorizacao do Servico Telefonico Fixo Comutado, Modalidade
Longa Distancia Nacional de Ambito Intra-Regional, Que Entre Si
Celebram A Agencia Nacional de Telecomunicacoes - ANATEL e Canbra
Telefonica S.A.
3. The following described lease agreements:
(i) LOCATION: Rooms 801, 802, 803 and 806 of the 8th floor with
right to use 06 (six) vacancies at the garage - numbers 56,
57, 58, 59, 60 and 64 which correspond to the floors
mentioned, at the building located at 3131, President Xxxxxx
Avenue, Cidade Nova, Rio de Janeiro.
TERM: 60 (sixty) months with right to renew for an additional
60 (sixty) months.
AMOUNT: The monthly rent is R$42.787,00 (forty-two thousand
and seven hundred and eighty seven reais).
RENEWAL: May 6, 2004.
(ii) LOCATION: 24th and 25th floors of the building located at 000,
Xxxxx Avenue, Rio de Janeiro with right to use 36 (thirty-six)
vacancies at the garage.
TERM: 60 (sixty) months with right to renew for an additional
60 (sixty) months.
AMOUNT: The monthly rent is R$66.000,00 (sixty-six thousand
reais).
RENEWAL: March 10, 2004.
(iii) LOCATION: 21st floor of the building located at 000, Xxxxx
Avenue, Rio de Janeiro with right to use 18 (eighteen)
vacancies at the garage.
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TERM: 12 (twelve) months with right to renew for an additional
12 (twelve) months.
AMOUNT: The monthly rent is R$33.000,00 (thirty-three thousand
reais).
RENEWAL: June 6, 2000.
(iv) LOCATION: 22nd floor of the building located at 000, Xxxxx
Avenue, Rio de Janeiro with right to use 18 (eighteen)
vacancies at the garage.
TERM: 12 (twelve) months with right to renew for an additional
48 (forty-eight) months.
AMOUNT: The monthly rent is R$33.000,00 (thirty-three thousand
reais).
RENEWAL: June 20, 2000.
(v) LOCATION: 23rd floor of the building located at 000, Xxxxx
Avenue, Rio de Janeiro with right to use 18 (eighteen)
vacancies at the garage.
TERM: 60 (sixty) months with right to renew for an additional
60 (sixty) months.
AMOUNT: The monthly rent is R$33.000,00 (thirty-three thousand
reais).
RENEWAL: May 13, 2004.
(vi) LOCATION: 00, Xxx Xxxxxx Xxxxxx, Xxxxx Xxxxx, Xxxxxxx,
Espirito Santo.
TERM: 60 (sixty) months with right to renew for an additional
60 (sixty) months.
AMOUNT: The monthly rent is R$18.000,00 (eighteen thousand
reais).
RENEWAL: June 10, 2004.
4. Technical Services Agreement between Xxxx Canada and Vesper dated
May 27, 1999.
5. Secondment Agreement dated as of May 27, 1999 between Vesper and
Xxxx Canada.
6. Technical Services Agreement dated as of May 27, 1999 between Vesper
and Xxxx Canada.
7. Contrato de Interconexao de Redes de Telecomunicacoes Entre a
Embratel (Empresa Brasileira de Telecomunicacoes S.A.) x x Xxxxxx.
8. Contrato de Interconexao de Redes de Telecomunicacoes Entre a Xxxxxx
x x Concessionarios do STFC - Regiao 1 (Tele Norte Leste).
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9. Program Agreement established between the State of Rio de Janeiro
and Vesper dated July 13, 1999.
10. Memorandum of Understanding between Vesper and BCP S.A. dated May
21, 1999.
11. Memorandum of Understanding between CGI Telecom International Inc.
and Vesper, dated as of June 23, 1999, and respective amendment dated
October 15, 1999.
12. Deed of a promise of purchase and sale of land in the city of Macae
entered between Vesper and Rocinio Xxxxxxxx Xxxxxxx dated July 30,
1999.
13. Deed of a promise of purchase and sale of a building in the city of
Belem entered between Vesper and Xxxxxx Xxxx Xxxxxxxx Xxxxxxxx and
Xxxxxxx Xxxxxxxx Neto dated July 19, 1999.
14. Equipment Supply Agreement between Ericsson Inc. and Vesper dated
August 4, 1999.
15. Commitment Letter dated as of August 10, 1999 from Nortel Networks
Corporation, Northern Telecom do Brasil Comercio e Servicos Ltda. and
Northern Telecom do Brasil Industria e Comercio Ltda. to Xxxx Canada
International (Brazil Telecom 1) Limited, SLI, Qualcomm Brasil,
Taquari, VeloCom Brasil, Vesper, Xxxx Canada, VeloCom, Qualcomm, Rio
Purus Participacoes Ltda., CFL Participacoes Ltda., Xxxxxx Xxxxxxxx and
Xxxxxxxxx Xxxxxxxx.
16. Letter Agreement dated August 10, 1999 by and among Nortel Networks
Corporation, Northern Telecom do Brasil Comercio e Servicos Ltda. and
Northern Telecom do Brasil Industria e Comercio Ltda., Xxxx Canada
International (Brazil Telecom 1) Limited, SLI, Qualcomm Brasil,
Taquari, VeloCom Brasil, Vesper, Xxxx Canada International Inc.,
Velocom, Qualcomm, Rio Purus Participacoes Ltda., CFL Participacoes
Ltda., Xxxxxx Xxxxxxxx and Xxxxxxxxx Xxxxxxxx.
17. Summary of Indicative Terms and Conditions dated August 4, 1999
proposed by Nortel Networks Corporation.
18. Contrato de Locacao de Area e Compartilhamento de Infra-Estructura
entre a Empresa Brasileira de Telecomunicacoes S.A. -EMBRATEL x x
Xxxxxx
19. Contrato de Locacao de Sistema de Telecomunicacoes entre a Light
Telecom Ltda. x x Xxxxxx
20. Commitment Letter between Ericsson, Qualcomm and Vesper dated
August 4, 1999.
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21. Contract for Services between Vesper and Netstream Telecom Ltda.
dated as of August 15, 1999.
22. Instrument for the Construction of Call Center between Vesper and
Engineering S.A. Servicios Tecnicos dated August 27, 1999.
23. Interconnection Agreement between Vesper and Intelig
Telecomunicaciones.
24. Senior Secured Note Purchase Agreements each dated December 13,
1999 between Vesper and Nortel Networks Corporation, Qualcomm/Ericsson,
Xxxxxx Corporation and ABN Amro, as agent and related loan
documentation.
25. Common Terms Agreement dated December 13, 1999 between Vesper,
Vesper Holding, ABN Amro and the lenders thereto dated December 1999.
26. Technical Assistance Agreement between VeloCom and Vesper to be
effective as of November 30, 1999.
27. Equipment Supply and Services Agreement dated July 9, 1999 between
Vesper, Nortel Networks Corporation, Northern Telecom do Brasil
Industria e Comerico Ltda. and Northern Telecom do Brasil Comerico e
Servicios Ltda.
28. License for Packet Switched Network Services issued by Anatel on
September 23, 1999.
29. License for Circuit Switched Network Services issued by Anatel on
September 23, 1999.
30. License for Dedicated Line Services issued by Anatel on September
23, 1999.
31. License for Special Services of Audio and Video Signal issued by
Anatel on September 23, 1999.
32. License for Retransmission issued by Anatel on September 23, 1999.
33. Fiber Contract between Vesper and Energedes dated August 12, 1999.
34. Switch Site Lease Contract between Vesper and Embratel.
35. Fiber Contract between Vesper and Metrored dated September 3, 1999.
36. Colocation Agreement between Vesper and North Brazil Telecom dated
October 1999.
37. Memorandum of Understanding between Vesper and NQT for fiber.
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38. Memorandum of Understanding between Vesper and Barramas for dark
fiber and ducts.
39. Memorandum of Understanding between Vesper and Escelsa for fiber.
40. Satellite Agreement between Vesper and Embratel dated September 3,
1999.
41. Mobile Interconnection Agreements with Telefonica, ATL, TIW, NBT,
Maxitel, BSE and XXX.
42. Local Backbone Agreement between Vesper and Escelsa dated October
20, 1999.
43. Local and Long Distance Backbone Agreements between Vesper and NQT
dated October 20, 1999.
44. Equipment Supply and Services Agreement between Vesper and NEC do
Brasil for Macapu and Boa Vista.
45. Equipment Supply and Services Agreement with Priority Call
Management for Prepaid and Voice Mail Solution.
46. CPE Equipment Supply Letter of Intent with Motorola.
47. Consulting Services Agreement with Spectralliance LLC.
48. CPE Equipment Supply Letter of Intent with LG Information
Communications.
49. Fiber Lease Contract with NQT.
50. Capital Contribution Agreement dated December 13, 1999 between
Vesper Holdings, Vesper, Xxxx Canada, Qualcomm, Brasil Holdings, and
the Collateral Agent.
51. Global Notes executed by Vesper in favor of Nortel,
Qualcomm/Ericsson and Xxxxxx Corporation dated December 13, 1999.
52. Exchange Debt Agreement between Vesper, Nortel, Qualcomm, Ericsson
and Xxxxxx Corporation dated December 16, 1999.
53. Equipment Pledge Agreement dated December 16, 1999 executed by
Vesper in favor of the Collateral Agent and various related powers of
attorney.
54. Receivables Pledge Agreement dated December 16, 1999 between Vesper
and the Collateral Agent and related powers of attorney.
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55. Eight Deposit Account Agreements dated December 16, 1999 executed
by Vesper in favor of the Collateral Agent.
56. Contracts Pledge Agreement dated December 16, 1999 executed by
Vesper in favor of the Collateral Agent and related power of attorney.
57. Cash Collateral Pledge Agreement dated December 16, 1999 between
Vesper and the Collateral Agent.
58. Proceeds Account Pledge Agreement dated December 16, 1999 between
Vesper and the Collateral Agent.
59. Mortgages executed by Vesper in connection with Nortel/Qualcomm/
Ericsson/Xxxxxx Corporation financing.
60. Fee letters executed by Vesper in connection with financings dated
December 13, 1999.
61. Paying Agency Agreement dated December 13, 1999 between Vesper and
Chase Manhattan Bank.
62. Equipment Supply Agreement dated December 6, 1999 between Vesper
and Motorola do Brasil.
63. Financing Commitment letter between Vesper and Motorola do Brasil.
MEGATEL
1. Termo de Autorizacao do Servico Telefonico Fixo Comutado, Modalidade
Local, Que Entre Si Celebram A Agencia Nacional de Telecomunicacoes -
ANATEL e MegaTel.
2. Termo de Autorizacao do Servico Telefonico Fixo Comutado, Modalidade
Longa Distancia Nacional de Ambito Intra-Regional, Que Entre Si
Celebram A Agencia Nacional de Telecomunicacoes - ANATEL e MegaTel.
3. The following described lease agreements:
(i) LOCATION: 11th floor, parts A and B of the building Villa-Lobos,
with right to use 36 (thirty-six) vacancies at the garage of the
mentioned building which is located at Nacoes Unidas Avenue
number 4.777, at Sao Paulo, State of Sao Paulo, Brazil.
TERM: 60 (sixty) months with right to renew for an additional 60
(sixty) months.
AMOUNT: R$37.159,00
RENEWAL: 06/30/2.004
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(ii) LOCATION: 10th floor, part B of the building mentioned above
with right to have 18 (eighteen) vacancies at the garage of
the same building, located at the same address.
TERM: 60 (sixty) months with right to renew for an additional
60 (sixty) months.
AMOUNT: R$18.579,00
RENEWAL: 06/30/2.004
(iii) LOCATION: 12th floor, parts A and B of the building mentioned
above with right to have 36 (thirty-six) vacancies at the
garage of the same building, located at the same address.
TERM: 60 (sixty) months with right to renew for an additional
60 (sixty) months.
AMOUNT: R$92.897,50
RENEWAL: 06/30/2.004
4. Know-how Transfer and Technical Services Agreement between Xxxx
Canada and MegaTel dated as of July 30, 1999.
5. Agreement between IBM Brasil Leasing Arrendamento Mercantil S.A. and
MegaTel dated July 21, 1999.
6. Letter of Understanding dated as of July 30, 1999 between MegaTel
and Xxxx Canada.
7. Secondment Agreement dated as of July 30, 0000 xxxxxxx Xxxx Xxxxxx
and MegaTel.
8. Technical Services Agreement dated as of July 30, 0000 xxxxxxx Xxxx
Xxxxxx and MegaTel.
9. Equipment Supply Agreement dated September 27, 1999 between MegaTel
and Lucent.
10. Commitment Letter between Lucent Technologies Network Systems do
Brasil Ltda. and MegaTel dated September 27, 1999.
11. Interconnection Agreement between MegaTel and Bonari dated August
15, 1999.
12. Interconnection Agreement between MegaTel and Embratel dated August
10, 1999.
13. Agreement between MegaTel and Netstream S.A. regarding use of
fiber.
14. License for Packet Switched Network Services issued by Anatel on
September 23, 1999.
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15. License for Circuit Switched Network Services issued by Anatel on
September 23, 1999.
16. License for Dedicated Line Services issued by Anatel on September
23, 1999.
17. License for Special Services of Audio and Video Signal issued by
Anatel on September 23, 1999.
18. License for Retransmission issued by Anatel on September 23, 1999.
19. Interconnection Agreement between MegaTel and Telesp dated August
20, 1999.
20. Fiber Agreement between MegaTel and Eletropaulo.
21. Agreement between MegaTel and SAP.
22. Contrato de Arrendamento Mercantil com a IBM Brasil Leasing
Arrendamento Mercantil S.A. para o arrendamento mercantil de
equipamentos de informatica e telecomunicacoes, dentre outros com IBM
Brasil - Industria, Maquinas e Servicos Ltda. e Northern Telecom do
Brasil Comercio e Servicos Ltda. ("leasing agreement with IBL for IT
and Telecom/call center equipment, includes IBM and other IT vendors as
well as Nortel").
23. Contrato de fornecimento de equipamentos e servicos de
telecomunicacoes com a Lucent Technologies Network Systems do Brasil
Ltda. e outros. ("supply agreement with Lucent Technologies").
24. Compromisso de compra e venda dos imoveis ("switch buildings
purchase commitments" - the purchase agreements will b probably signed
by a finance company which will lease the buildings to us for a 15 year
term, still under negotiation) 1. Lapa -Rua Xxxxxx Xxxxxxxx, n(0)
2.200, Perdizes - Sao Paulo; 2. Jabaquara - Xxx Xxxxx, x(0)x 000 x 000,
Xxxxx - Xxx Xxxxx; 3. Osasco - Xxx Xxxxx Xxxxx Xxxxx, x(0)x 00 x 00,
Xxxx Xxxxxx - Osasco; 4. Paraiso - Rua Conselheiro Ramalho, n(0) s 778
e 768 - Bela Vista - Sao Paulo; 5. Sao Xxxxxxxx -Xxxxxxx Xxxxxxxxxxx ,
x(0) 000, Xxxxxxxxxxx - Xxx Xxxxxxxx do Campo; 6. Campinas - Marechal
Xxxxxx.
25. Licenca para transporte de dados - ANATEL ("data transport license"
- under analysis by regulatory regarding all possible applications)
26. Credit Agreement dated December 27, 1999 between Megatel, Vesper
Sao Paulo Cayman, the lenders thereto and the administrative agent.
27. Common Agreement dated December 27, 1999 between Megatel, Vesper
Sao Paulo Holding, Lucent and the Collateral Agent.
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28. Pledge and Security Agreements and other collateral documents
executed in connection with the Lucent financing referred to above.
29. Equipment Supply Agreement dated December 1999 between Megatel and
Motorola do Brasil.
30. Interconnection Agreement, dated August 5, 1999, between Intelig
(Bonari Holding) and Megatel.
31. Interconnection Agreement, dated August 20, 1999, between Embratel
and Megatel.
32. Interconnection Agreement, dated August 20, 1999, between
Telefonica and Megatel.
33. Interconnection Agreement, dated August 20, 1999, between Compania
Telefonica xx Xxxxx do Xxxxx and Megatel.
34. Interconnection Agreement, dated November 16, 1999, between BCP and
Megatel.
35. Interconnection Agreement, dated November 26, 1999, between Tess
and Megatel.
36. Lease Agreement, dated August 20, 1999, between Megatel and IBM.
37. Lease Agreement, dated August 20, 1999, between Megatel and IBM.
38. Lease Agreement, dated August 20, 1999, between Megatel and IBM.
39. Know-How Transfer and Technical Services Agreement, dated December
27, 1999, between BCI and Megatel.
40. Credit Agreement dated as of December 27, 1999, among Vesper Sao
Paulo Holdings, Megatel, Vesper Cayman Sao Paulo, the Lenders
thereunder and Societe Generale, New York Branch, as Administrative
Agent.
41. Paying Agency Agreement dated as of December 27, 1999, among the
Japanese Paying Agent, Megatel and Vesper Cayman Sao Paulo.
42. Share Pledge Agreement, dated December 27, 1999, by and among
Vesper Holdings, Qualcomm do Brasil S.A., Vesper Cayman Sao Paulo, and
the Lenders.
43. Secondment Agreement, dated December 27, 1999 between BCI and
Megatel.
44. Substitute Financing Side Letter, dated December 27, 1999, among
Qualcomm, the Company, BCI, the Lenders and the Agents.
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45. Technical Services Agreement dated July 30, 1999, between BCI and
Vesper, as amended by Amendment No. 1, dated December 23, 1999, between
the same parties.
46. Telecom and Eletropaulo Rental Agreement, dated October 22, 1999,
by and among Megatel, Eletropaulo Telecomunicacoes Ltda. and
Eletropaulo Metropolitana Eletricidade de Sao Paulo S.A.
47. Loan Guarantee, dated as of December 27, 1999, made by Megatel in
favor of the Collateral Agent.
48. Fee letter dated December 27, 1999, between Megatel and Lucent.
TMC
1. Limited Liability Company Agreement: dated as of Xxxxxxxx 00, 0000,
xxxxx XXX, XXX, Xxxxxxxxx LLC, and TMC.
2. Agreement for Lease of Telecommunications Network dated as of
January 11, 1999, between Smartel and TMC.
3. Agreement for Lease of Telecommunications Network dated as of
January 11, 1999 between Formus Argentina and TMC.
4. Agreement for Lease of Telecommunications Network dated as of
January 11, 1999 between Telelatina and TMC.
5. Management Agreement dated as of February 11, 1999 between Smartel
and TMC.
6. Management Agreement dated as of February 11, 1999 between
Telelatina and TMC.
7. Management Agreement dated as of February 11, 1999 between Formus
Argentina and TMC.
8. Sales And Assignment Agreement dated as of February 11, 1999 between
Telelatina and TMC.
9. Trial Agreement, effective as of August 10, 1998 among Lucent
Technologies World Services Inc., Lucent Technologies S.A Argentina and
Telelatina. Assigned in favor of TMC on March 11, 1999.
10. Purchase and Sale Agreement (Products, Software And Services),
among Lucent Technologies World Services Inc., Lucent Technologies S.A
Argentina and Telelatina executed on February 20, 1999, February 23,
1999 and February 26, 1999, respectively. Assigned in favor of TMC on
March 11, 1999.
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11. Lease Agreement with Option to Purchase between Lucent Technologies
Sociedad Anonima and TMC, dated as of June 25, 1999.
12. Lease Agreement with Option to Purchase between Lucent Technologies
Sociedad Anonima and TMC, dated as of June 25, 1999.
13. Purchase Order between Lucent Technologies World Services Inc.,
Lucent Technologies S.A Argentina and TMC dated as of July 8, 1999.
14. Services Contract, dated February 25, 1999 between IMPSAT S.A and
TMC.
15. Services Contract, dated April 21,1999 between Xxxxxx & Co.
Personas y Organizaciones S.R.L and TMC.
16. Lease Contract, dated March 12, 1999 between Xxxxxxx Xxxxxx Stigol
(Lessor) and Xxxxxxxxx Xxxxxxx Costa (Lessee). Property Location: Xxxxx
Xxxx 3046, Apartment 23 "Golf".
17. Lease Contract, dated March 17, 1999 between Xxxxx Xxxxxxx Taquini
(Lessor) and TMC (Lessee). Property Location: Xxxxxxxx 3158, Apartment
9B.
18. Lease Contract, dated March 17, 1999 between Xxxxxxx Xxxxxx
Xxxxxxxx (Lessor) and TMC (Lessee). Property Location: Xxxxxxx 0000,
4th Floor.
19. Lease Contract, dated March 26, 1999 between Forobra S.A (Lessor)
and TMC (Lessee). Property Location: Av. San Xxxxxx 638/40.
20. Lease Contract, dated March 10, 1999 between Financiera Buenos
Aires S.A(Lessor) and TMC (Lessee). Property Location: Maipu 255, 19th
Floor, with three (3) fixed parking spaces.
21. Gratuitous Assignment Of Lease Contract, dated March 10, 1999 among
Telelatina (Assignor), TMC (Assignee) and Financiera Buenos Aires S.A
(Lessor). Property Location: Maipu 255, 20th Floor, three (3) fixed
parking spaces and space on the terrace for installation of
telecommunication equipment (as gratuitous commodatum).
22. Lease Contract, dated July 5, 1999 between Consorcio de
Propietarios de La Calle Ugarteche 2871/73/75/77 (Lessor) and TMC
(Lessee). Property Location: Ugarteche 2873; space on the terrace of
the building for the installation of telecommunication equipment.
23. Lease Contract, dated June 9, 1999 between Consorcio De
Propietarios Avenida De Los Incas numero 3310 esquina calle CONDE
numeros 1586 y 1594 Capital Federal (Lessor) and TMC (Lessee). Property
Location: Xx. xx xxx Xxxxx 0000; space on the terrace of the building
for the installation of telecommunication equipment.
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24. Lease Contract, dated June 18, 1999 between COCABA S.R.L (Lessor)
and TMC (Lessee). Property Location: Xxxxx 3433; space on the terrace
of the building for the installation of telecommunication equipment.
25. Lease Contract, dated June 18, 1999 between Consorcio de
Xxxxxxxxxxxx xx Xx Xxxxx XXXXX 0000 (Xxxxxx) and TMC (Lessee). Property
Location: Xxxxx 2419; space on the terrace of the building for the
installation of telecommunication equipment.
26. Lease Contract, dated June 25, 1999 between Consorcio de
Xxxxxxxxxxxx Xxx Xxxxxxxx xx Xx Xxxxx Xxxxx0000/00 (Lessor) and TMC
(Lessee). Property Location: Xxxxx 0000/00; space on the terrace of the
building for the installation of telecommunication equipment.
27. Lease Contract, dated June 30, 1999 between Consorcio de
Xxxxxxxxxxxx xx Xx Xxxxx Xxxxxxxx 0000 (Xxxxxx) and TMC (Lessee).
Property Location: Honduras 5597; space on the terrace of the building
for the installation of telecommunication equipment.
28. Lease Contract, dated June 30, 1999 between Consorcio de
Xxxxxxxxxxx xx Xx Xxxxx Xxxxxxx 0000 (Xxxxxx) and TMC (Lessee).
Property Location: Xxxxxxx 1670; space on the terrace of the building
for the installation of telecommunication equipment.
29. Lease Contract, dated June 18, 1999 between Consorcio de
Propietarios Edificio Galeria Jardin (Lessor) and TMC (Lessee).
Property Location: Florida 537/71; space on the terrace of the building
for the installation of telecommunication equipment.
30. Electric Supply Contract, dated May 11, 1999 between Edesur S.A and
TMC.
31. Service Contract, dated May 17, 1999 between TMC and Tamabru S.A
32. Lease Contract, dated July 15, 1999 between Consorcio de
Propietarios Del Edificio Ubicado En La Calle Xxxxxxxx General Xxxx X.
Xxxxx 1457 (Lessor) and TMC, Sucursal Argentina (Lessee). Property
Location: Xxxxxxxx General Xxxx X. Xxxxx 1457, Buenos Aires, space on
the terrace of the building for the installation of telecommunication
equipment.
33. Lease Contract, dated July 8, 1999 between Xxxxxxx Construcciones
S.A. (Lessor) and TMC, Sucursal Argentina (Lessee); Property Location:
Xxxxxxx 0000, Xxxxxx Xxxxx; space on the terrace of the building for
the installation of telecommunication equipment.
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34. Service Order, subscribed between Metrored and TMC, dated as of
June 15, 1999.
35. Service Order, subscribed between Metrored and TMC, dated as of
June 22, 1999.
36. Purchase Order, subscribed by TMC to Idabour Construcciones, dated
as of June 15, 1999.
37. Subscription and Redemption of Mutual Funds, dated July 16, 1999
between Citibank N.A. and TMC.
38. Maintenance Service Contract, dated as of July 1,1999 between TMC
and Lucent Technologies S.A. Argentina.
39. Lease Contract, dated July 23, 1999 between Consorcio de
propietarios Xxxxx Xxxxxx 3005 (Lessor) and TMC, Sucursal Argentina
(Lessee); Property Location: Xxxxx Xxxxxx 0000, Xxxxxx Xxxxx; space on
the terrace of the building for the installation of telecommunication
equipment.
40. Lease Contract, dated July 25, 1999 between Consorcio de
propietarios Olleros 2344 (Lessor) and TMC, Sucursal Argentina
(Lessee); Property Location: Xxxxxxx 0000, Xxxxxx Xxxxx; space on the
terrace of the building for the installation of telecommunication
equipment.
41. Lease Contract, dated August 20, 1999 between Consorcio de
Propietarios xx Xxxxxx 785 and TMC. Property Location: Xxxxxx 785;
space on the terrace of the building for the installation of
telecommunications equipment.
42. Lease Contract, dated September 13, 1999 between Asoc. Civil y
Mutual Circular Militar and TMC. Property Location: Santa Fe 760, space
on the terrace of the building for the installation of
telecommunications equipment.
43. Lease Contract, dated October 8, 1999 between Consorcio de
Propietarios de Av. Gral. Las Xxxxx 2263 and TMC. Property location:
Xxxxx 2263; space on the terrace of the building for the installation
of telecommunications equipment.
44. Lease Contract, dated September 10, 1999 between Prefectura Naval
Argentina and TMC. Property Location: Edificio Guardacostas; space on
the terrace of the building for the installation of telecommunications
equipment.
45. Lease Contract, dated September 6, 1999 between Consorcio de
Propietarios de Maure 3149/51 and TMC. Property Location: Maure
3149/51;
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space on the terrace of the building for the installation of
telecommunications equipment.
46. Services Contract, dated March 23, 1999 between El Sitio and TMC.
47. Letter of Intent dated July 28, 1999, between TMC and Transistemas
S.A.
48. Purchase Order dated July 8, 1999 between TMC and Lucent
Technologies S.A. Argentina and Lucent Technologies World Services Inc.
in respect of $10,739,987 of equipment.
TELELATINA
1. Memorandum Of Understanding "Memorandum de Entendimiento" dated
July, 1998 between Telelatina and Datacoop S.A
2. Management Agreement, as of February 11, 1999 between Telelatina and
TMC.
3. Agreement for Lease of Telecommunications Network, as of January 11,
1999 between Telelatina and TMC.
4. Lease Contract, dated June 24, 1998 between Consorcio de
Propietarios del Edificio Ubicado en La Calle Dorrego 2699 (Lessor) and
TMC (Lessee). Property Location: Dorrego 2699.
5. Infrastructure Sharing Agreement, as of February 11, 1999 among
Telelatina, Smartel and Formus Argentina.
6. Agreement for the Rendering of Services, as of May 31, 1999 between
Telelatina and Xxxx X.X.
7. Sales and Assignment Agreement, as of February 11, 1999 between
Telelatina and TMC.
SMARTEL
1. Infrastructure Sharing Agreement, as of February 11, 1999 among
Telelatina, Smartel and Formus Argentina.
2. Agreement For Lease of Telecommunications Network, as of January 11,
1999, between Smartel and TMC.
3. Management Agreement, as of February 11, 1999 between Smartel and
TMC.
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FORMUS ARGENTINA
1. Management Agreement dated as of February 11, 1999 by and among
Formus Argentina and TMC.
2. Agreement for Lease of Telecommunications Network dated as of
January 11, 1999 by and among Formus Argentina and TMC.
3. Infrastructure Sharing Agreement dated as of February 11, 1999 by
and among Telelatina, Formus Argentina and Smartel.
FORMUS CHILE
Foreign Investment Contract with Chile.
FORMUS COLOMBIA
1. Purchase order to Wireless Inc. for $125,000 to purchase six 38 GHz
links.
2. Purchase Order Agreement between Formus Colombia and Tess dated
October 1999.
ARGENTINA LLC
Limited Liability Company Agreement dated as of Xxxxxxxx 00, 0000,
xxxxx XXX, XXX, Xxxxxxxxx LLC, and TMC.
COLOMBIA LLC
Consulting Agreement dated January 27, 1998 by Xxxxxxxx & Associates,
Inc. and Colombia LLC.
VESPER CAYMAN
1. Purchase Fee Letters dated December 13, 1999 between Vesper Cayman
and ABN Amro.
VESPER SAO PAULO CAYMAN LTDA.
1. Common Terms Agreement, Credit Agreement and various pledge and
security documents executed in connection with the Lucent vendor
financing.
EJEMIL S.A. AND ODECAR S.A.
1. Memorandum of Understanding between the Company, Ejemil S.A., Odecar
S.A., Xx. Xxxxx Xxxxxxx Xxxxxxx and El Pais S.A. dated November 29,
1999.
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SCHEDULE 4.12
SUBSIDIARIES
VELCOM,INC
[FLOWCHART]
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SCHEDULE 4.13
CAPITALIZATION OF SUBSIDIARIES
VELOCOM BRASIL
Velocom Brasil has an authorized and issued capital of R$23,377,392.00
divided into 23,377,392 quotas of par value R$1.00 each. In connection
with the restructuring of this entity, its capital is being reduced.
BRASIL HOLDINGS
Brasil Holdings has an authorized capital of US$50,000 divided into
50,000 shares of par value $1.00 each, of which 2 shares are issued and
outstanding in the name of VeloCom.
VESPER HOLDING
Vesper Holding has an authorized and issued capital of R$184,445,760
divided into 536,000 ordinary shares with no par value and 536,000
preferred shares with no par value.
VESPER SAO PAULO HOLDING
Vesper Sao Paulo Holding has an authorized and issued capital of
R$119,119,000 divided into 119,000 ordinary shares with no par value
and 119,000 preferred shares with no par value.
XXXXXX
Xxxxxx has an authorized and issued capital of R$77,033,010 divided
into 431,171 ordinary shares with no par value.
VESPER CAYMAN
Vesper Cayman has an authorized and issued capital of US$1.00 divided
into 1 share.
MEGATEL
MegaTel has an authorized and issued capital of R$69,913,000 divided
into 70,813 ordinary shares with no par value.
VESPER SAO PAULO CAYMAN LTD.
Vesper Sao Paulo Cayman has an authorized and issued capital of US$1.00
divided into 1 share.
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ENCUMBRANCES
The shares of Vesper, Vesper Holding, Vesper Sao Paulo Holding and
MegaTel are subject to the terms of the respective shareholders agreements,
constituent documents and Licenses. The shares of Vesper and MegaTel will be
pledged to certain lenders pursuant to the terms of the vendor financing
arrangements currently being negotiated as described in the Schedules to this
Agreement.
TMC
Capital contributions of US$15,963,953 have been made to TMC. The
number of shares authorized and issued is 1,000.
TELELATINA
1. Telelatina has an authorized and issued capital of A$1,000,000
divided into 1,000,000 shares with a par value of A$1.00 per share.
There is also an irrevocable capital contribution of A$2,242,326
recorded on the books of this company.
2. Sales And Assignment Agreement, as of February 11, 1999 between
Telelatina and TMC.
VELOCOM ARGENTINA
VeloCom Argentina has an authorized and issued capital of A$3,000
divided into 3,000 quotas of par value A$1.00 each.
WLL ARGENTINA
WLL Argentina has an authorized and issued capital of A$2,000 divided
into 200 quotas of par value A$10.00 each.
SMARTEL
Smartel has an authorized and issued capital of A$20,000 divided into
20,000 shares with a par value of A$1.00 per share. There is also an
irrevocable capital contribution of A$2,000,000 recorded on the books
of the Company which has not yet been funded.
PCN
PCN has an authorized and issued capital of US$100,000, divided into
100,000 shares with a par value of US$1.00 per share. There is also an
irrevocable capital contribution of US$4,767,238.86 recorded on the
books of this company.
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VELOCOM CHILE
VeloCom Chile has an authorized and issued capital of CH$910,455
divided into 910,455 quotas.
EJEMIL S.A.
Ejemil S.A. has nominal capital.
ODECAR S.A.
Odecar S.A. has nominal capital.
CHILE HOLDINGS
Chile Holdings has an authorized capital of US$50,000 divided into
50,000 shares of par value US$1.00 each, of which 2 shares are issued
and outstanding in the name of VeloCom.
COLOMBIA HOLDINGS
Colombia Holdings has an authorized capital of US$50,000 divided into
50,000 shares of par value US$1.00 each, of which 2 shares are issued
and outstanding in the name of VeloCom.
FORMUS ARGENTINA
Formus Argentina has an authorized and issued capital of A$12,000
divided into 12,000 ordinary shares with a par value of A$1.00.
FORMUS BOLIVIA
Formus Bolivia has an authorized and issued capital of Bs$10,000,000
divided into 200 shares or Bs$20,000,000 with a par value of
Bs$100,000.
FORMUS CHILE
Formus Chile has an authorized and issued capital of CH$455,000,455
divided into unlimited equity interest with no par value.
FORMUS COLOMBIA
Formus Colombia has an authorized and issued capital of C$800,522,200
divided into 8,005,222 shares with a par value of C$100.
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XXXXXX XX
Xxxxxx LA has one membership interest outstanding which was issued for
US$100.
FORMUS PERU
Formus Peru has an authorized and issued capital of NS$2,700 divided
into 2,700 unlimited equity interest with no par value.
FORMUS VENEZUELA
Formus Venezuela has an authorized and issued capital of B$4,000,000
divided into 2,000 shares with a par value of B$10,000.
ARGENTINA LLC
Argentina LLC has one membership interest outstanding which was issued
for US$100.
BOLIVIA LLC
Bolivia LLC has one membership interest outstanding which was issued
for US$100.
CHILE LLC
Chile LLC has one membership interest outstanding which was issued for
US$100.
COLOMBIA LLC
Colombia LLC has one membership interest outstanding which was issued
for US$100.
PERU LLC
Peru LLC has one membership interest outstanding which was issued for
US$100.
VENEZUELA LLC
Venezuela LLC has one membership interest outstanding which was issued
for US$100.
INTERLOOP BVI
Interloop BVI has an authorized and issued capital of US$ 3,400,000
divided into 3,400,000 shares with a par value of $1.00 per share.
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INTERLOOP COLOMBIA
Interloop Colombia has an authorized and issued capital of
CP$2,397,950,000 divided into 2,397,950 shares with a par value of
CP$1.00 per share.
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SCHEDULE 4.14(a)
SHARE OWNERSHIP OF COMPANY
VELOCOM CAPITAL STRUCTURE - 12/6/99
TOTAL SERIES A TOTAL SERIES SERIES B TOTAL SERIES
NAME COMMON COMMON PREFERRED A PREFERRED PREFERRED B PREFERRED
---- ------ ------- ---------- ------------ ---------- ------------
Telecom Partners II, L.P. 200,000 855,556
1,300,000 2,811,111
1,500,000 1,939,108 5,605,775 833,333 833,333
Centennial Fund V, L.P. 932,600 652,820
2,144,980
1,388,831 250,000
Centennial Fund VI, L.P. -- -- 1,309,809
Centennial Entrepreneurs Fund 28,940 20,260
V L.P.
66,560
43,098
Centennial Entrepreneurs Fund -- -- 32,745
VI, L.P.
Centennial Holdings I, L.L.C. 38,460 26,920
88,460
1,000,000 57,275 4,489,204 36,506 1,629,060
Crescendo World Fund, L.L.C. 477,150 742,234 --
457,649 106,033
Crescendo III, L.P. -- 2,555,555
959,128 633,333
FULLY DILUTED %
NAME OPTIONS OWNERSHIP OWNERSHIP
---- ------- ------------- -----------
Telecom Partners II, L.P.
7,939,108 0.1485
Centennial Fund V, L.P. -- --
-- --
-- --
Centennial Fund VI, L.P.
Centennial Entrepreneurs Fund -- --
V L.P.
-- --
-- --
Centennial Entrepreneurs Fund
VI, L.P.
Centennial Holdings I, L.L.C. -- --
-- --
7,118,264 0.1332
Crescendo World Fund, L.L.C. -- --
-- --
Crescendo III, L.P. -- --
-- --
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VELOCOM CAPITAL STRUCTURE - 12/6/99
TOTAL SERIES A TOTAL SERIES SERIES B TOTAL SERIES
NAME COMMON COMMON PREFERRED A PREFERRED PREFERRED B PREFERRED
---- ------ ------- ---------- ------------ ---------- ------------
Eagle Ventures WF, L.L.C. 22,850 35,544
21,916 5,079
Crescendo III, GbR -- -- 13,059
Crescendo III Executive Fund, -- 500,000 -- 4,772,026 18,810 776,314
L.P.
SLI Wireless S.A. 4,330,709 4,330,709 7,840,000 7,840,000 1,500,000 1,500,000
Formus Communications - Latin 1,574,803 1,574,803 7,866,333 7,866,333 933,333 933,333
America Holdings, LLC
Xxxxx Capital Management, LLC -- -- 41,667 41,667
Xxxx Xxxxx Capital, L.P. -- -- 25,850
Xxxx Xxxxx Capital Ventures, -- -- 21,900
L.P.
Xxxx Xxxxx Capital -- -- 16,900
International
Xxxx Xxxxx Capital, Inc. -- -- 2,050 66,700
Mellon Ventures II, L.P. -- -- 1,666,667 1,666,667
Taquari Participacoes S.A. 1,035,064 1,035,064 -- -- --
FULLY DILUTED %
NAME OPTIONS OWNERSHIP OWNERSHIP
---- ------- ------------- -----------
Eagle Ventures WF, L.L.C. -- --
--
Crescendo III, GbR
Crescendo III Executive Fund, 6,048,340 0.1132
L.P.
SLI Wireless S.A. 13,670,709 0.2558
Formus Communications - Latin 10,374,469 0.1941
America Holdings, LLC
Xxxxx Capital Management, LLC 41,667 0.0008
Xxxx Xxxxx Capital, L.P. --
Xxxx Xxxxx Capital Ventures, --
L.P.
Xxxx Xxxxx Capital --
International
Xxxx Xxxxx Capital, Inc. 66,700 0.0012
Mellon Ventures II, L.P. 1,666,667 0.0312
Taquari Participacoes S.A. 1,035,064 0.0194
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VELOCOM CAPITAL STRUCTURE - 12/6/99
TOTAL SERIES A TOTAL SERIES SERIES B TOTAL SERIES
NAME COMMON COMMON PREFERRED A PREFERRED PREFERRED B PREFERRED
---- ------ ------- ---------- ------------ ---------- ------------
Black Coral Enterprises Inc. 638,164 638,164 -- -- --
C. Xxxxx Xxxxx 5,000 1,862 -- -- --
14,805 19,805 1,862 --
Xxxx Xxxxx 1,666 1,666 -- -- -- --
Xxxxxxx XxXxxxxxx 1,667 1,667 -- -- -- --
North River Ventures, Inc. 5,000 5,000 -- -- -- --
Pension Plan
Xxxxxxx Xxxxxxxxxx 24,000 24,000 -- -- -- --
Xxxxxxxx Xxxx 1,000 1,000 -- -- -- --
--
DIRECTORS, EMPLOYEES AND -- 651,948 -- 131,133 209,999 209,999
OPTIONS
------------------------ ---------- ---------- ---------
TOTAL 11,283,826 30,706,333 7,657,073
FULLY DILUTED %
NAME OPTIONS OWNERSHIP OWNERSHIP
---- ------- ------------- -----------
Black Coral Enterprises Inc. 638,164 0.0119
C. Xxxxx Xxxxx
21,667 0.0004
Xxxx Xxxxx 1,666 0.0000
Xxxxxxx XxXxxxxxx 1,667 0.0000
North River Ventures, Inc. 5,000 0.0001
Pension Plan
Xxxxxxx Xxxxxxxxxx 24,000 0.0004
Xxxxxxxx Xxxx 1,000 0.0000
--
DIRECTORS, EMPLOYEES AND 3,798,544 4,791,624 0.0897
OPTIONS
--
--
------------------------ ---------- ---------- ------
TOTAL 3,798,544 53,445,776 1.0000
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SCHEDULE 4.14(b)
AGREEMENTS RELATING TO EQUITY INTERESTS IN COMPANIES
VELOCOM
1. Option Agreement dated as of January 15, 1999 among the Company,
Xxxx Canada International Inc., Taquari, SLI, Qualcomm, and BID S.A.
2. Subscription Agreement between Formus and the Company dated August
20, 1999.
3. Subscription Agreement between SLI and the Company dated August 20,
1999.
4. Subscription Agreement between Taquari and the Company dated August
20, 1999.
5. Amended and Restated Investors Agreement dated as of September 27,
1999 between the Company and its principal stockholders.
6. Consent and Agreement dated September 22, 1999 between BCI, SLI,
Qualcomm, Vicunha and the Company.
7. Equity Subscription Agreements between the Company and each of
Xxxxxxx Xxxxxx, Xxxxx Xxxxxxx, R. Xxxxxx House, REINCO Corp., Xxxxxxx
X. Xxxxx, C. Xxxxx Xxxxx, Xxxxxxx Xxxxxxxxxx, North River Ventures,
Inc. Pension Plan, Xxxxxxx XxXxxxxxx, Xxxxxxxx Xxxx, Xxxx Xxxxxxx, Sean
White, Bernard Schotters, David Leonard, Barry Rowan and David
Tomizuka.
8. Joinder Agreements between the Company and each of R. Dwayne House,
REINCO Corp., Nicolas Kauser, Michael S. Quinn, Clarence Endy, David
Tomizuka, Brad Johnson and Barry Rowan.
9. Series A Preferred Stock Purchase Agreement dated as of January 26,
1999 between the Company, Telecom, Centennial and Crescendo.
10. Second Series A Preferred Stock Purchase Agreement dated as of May
7, 1999 between the Company, Telecom, Crescendo, Centennial, David J.
Leonard, Gregory P. Sadler, Fred A. Vierra, Robert McKenzie, C. James
Frank, R. Dwayne House and Nicolas Kauser.
11. Employment Letters between the Company and each of David Leonard,
Charles Schneider, Derek Koecher, Henry Peraza, Michael Casullo, Lisa
Gamel, Patricia Reichman, R. Dwayne House, John Gowen, Michael Quinn,
Barry Rowan, Antonio Salles, Steve Dougherty, Greg Sadler, Julia
Hughes, Nicolas
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Kauser, Endy, Brad Johnson, Diego Rodrigues, Willie Hernandez, Mark
Johnson, Dave Tomizuka, and Phillip Shoemaker.
12. Stock Option Agreements between the Company and each of David
Leonard (10/1/98), David Leonard (10/1/98), David Leonard (5/21/99),
Nicolas Kauser (10/1/98), Nicolas Kauser (5/21/99), Clarence Endy
(4/12/99), Clarence Endy (5/21/99), Clarence Endy (5/21/99), Barry
Rowan (7/12/99); Barry Rowan (7/12/99), John Gowen (12/7/98), John
Gowen (5/21/99), John Gowen (5/21/99), Michael Quinn (7/16/99), Michael
Quinn (7/16/99), Greg Sadler (12/7/98), Greg Sadler (5/21/99), Greg
Sadler (5/21/99), R. Dwayne House (1/4/99), R. Dwayne House (5/21/99),
R. Dwayne House (5/21/99), Michael Casullo (3/15/99), Michael Casullo
(5/21/99), Derek Koecher (6/7/99), Patricia Reichman (4/1/99), Julia
Hughes (10/5/98), Julia Hughes (12/7/98), Julia Hughes (12/7/98), Julia
Hughes (5/21/99), Shaun Orton (5/21/99), Lisa Gamel (3/8/99), Lisa
Gamel (5/21/99), Brad Johnson (5/3/99), Brad Johnson (5/21/99), Brad
Johnson (5/21/99), Charles Schneider (7/11/99), Henry Peraza (6/1/99),
Henry Peraza (6/1/99), Fred Vierra (9/17/98), Fred Vierra (5/21/99) and
Bernard Schotters (6/18/99), David Tomizuka (10/1/99), Steve Dougherty
(8/1/99), Antonio Salles (8/1/99), Luis Gonzalez Lanuza (10/1/99) and
Mario Janovich (10/1/99).
13. Equity Investment Agreement dated October 21, 1999 between the
Company and certain of its stockholders.
14. Purchase Agreement dated December 6, 1999 between the Company and
the investors set forth therein.
VELOCOM BRASIL
1. Option Agreement dated as of February 4, 1999 by and between Bell
Canada International (Brazil Telecom I) Limited and VeloCom Brasil.
2. Agreement dated as of February 4, 1999 by and between VeloCom Brasil
and QUALCOMM do Brasil S.A.
3. Shareholder Agreement between Taquari, SLI, Qualcomm, Bell Canada
International (Brazil Telecom I) Limited, VeloCom Brasil and Vesper
Holding, dated February 4, 1999.
BRASIL HOLDINGS
1. Option Agreement dated as of July 30, 1999 by and between Bell
Canada International (MegaTel) Limited and Brasil Holdings.
2. Shareholder Agreement between SLI, QUALCOMM, Bell Canada
International (MegaTel) Limited, Brasil Holdings and Vesper Sao Paulo
Holding dated July 30, 1999.
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3. Amended and Restated Shareholders Agreement dated as of December 23,
1999 between the shareholders of Vesper Sao Paulo Holding.
4. Amended and Restated Shareholders Agreement dated as of December 23,
1999 between the shareholders of Vesper Holding.
VESPER HOLDING
1. Shareholder Agreement between Taquari Participacoes S.A.
("Taquari"), SLI Wireless S.A. ("SLI"), QUALCOMM do Brasil S.A.
("QUALCOMM"), Bell Canada International (Brazil Telecom I) Limited,
VeloCom Brasil and Vesper Holding, dated February 4, 1999.
2. Amended and Restated Shareholder Agreement dated as of December 23,
1999 between the shareholders of Vesper Holding.
VESPER SAO PAULO HOLDING
1. Shareholder Agreement between SLI, QUALCOMM, Bell Canada
International (MegaTel) Limited, Brasil Holdings and Vesper Sao Paulo
Holding dated July 30, 1999.
2. Amended and Restated Shareholders Agreement dated as of December 23,
1999 between the shareholders of Vesper Sao Paulo Holdings.
ARGENTINA LLC
Oral agreement with Alfredo Iribarren for 1% of Formus Argentina LLC's
interest in TMC at such time that a liquidity event occurs.
COLOMBIA LLC
Consulting Agreement between Colombia LLC and Jacobsen Consulting dated
January 27, 1999.
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SCHEDULE 4.18
LICENSES
VESPER
1. Termo de Autorizacao do Servico Telefonico Fixo Comutado, Modalidade
Local, Que Entre Si Celebram A Agencia Nacional de Telecomunicacoes -
ANATEL e Vesper.)
2. Termo de Autorizacao do Servico Telefonico Fixo Comutado, Modalidade
Longa Distancia Nacional de Ambito Intra-Regional, Que Entre Si
Celebram A Agencia Nacional de Telecomunicacoes - ANATEL e Vesper.
3. License for Packet Switched Network Services issued by Anatel on
September 23, 1999.
4. License for Circuit Switched Network Services issued by Anatel on
September 23, 1999.
5. License for Dedicated Line Services issued by Anatel on September
23, 1999.
6. License for Special Services of Audio and Video Signal issued by
Anatel on September 23, 1999.
7. License for Retransmission issued by Anatel on September 23, 1999.
Vesper may experience certain delays in meeting its build out obligations under
its licenses. The Company does not believe that the impact of these delays will
be material but there could be resulting fines due to such delays.
MEGATEL
1. Termo de Autorizacao do Servico Telefonico Fixo Comutado, Modalidade
Local, Que Entre Si Celebram A Agencia Nacional de Telecomunicacoes -
ANATEL e MegaTel.
2. Termo de Autorizacao do Servico Telefonico Fixo Comutado, Modalidade
Longa Distancia Nacional de Ambito Intra-Regional, Que Entre Si
Celebram A Agencia Nacional de Telecomunicacoes - ANATEL e MegaTel.
3. Licenca para transporte de dados - ANATEL ("data transport license"
- under analysis regarding all possible applications).
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MegaTel may experience certain delays in meeting its build out obligations under
its licenses. The Company does not believe that the impact of these delays will
be material but there could be resulting fines due to such delays.
TELELATINA
1. By Resolution 2617SC/97 issued by the Secretary of Communications on
September 4, 1997, Telelatina was granted a license to provide Value
Added Services, Data Transmission Services and Videoconferencing
services nationwide.
2. By Resolution 3064SC/97, issued by the Secretary of Communications
on October 15, 1997, Telelatina was granted an authorization to use the
frequency bandwidth from 3,450 Mhz to 3,475 Mhz. and from 3,550 Mhz. to
3,575 Mhz. The use of these frequencies is governed by Resolution
2879SC/97 as amended by 869SC/98.
Telelatina has applied for modifications to the build out schedule under its
licenses due to the fact that certain of the equipment to be used by it is still
in the testing phase. The Company expects that each of these requests for
modification will be granted.
SMARTEL
1. By Resolution 1130SC/98 issued by the Secretary of Communications on
May 7, 1998, Smartel was granted a license to provide Value Added
Services, Data Transmission Services, Broadcasting signals carriage
services and Videoconferencing services.
2. By Resolution 1247SC/98, issued by the Secretary of Communications
on May 22, 1998, Smartel was granted an authorization to use on a
precarious basis, for the AMBA (which area comprises the City of Buenos
Aires and certain locations nearby), Rosario, Cordoba and Mendoza the
frequency bandwidth from 26,850 Ghz to 27,350 Ghz. and from 31,075 Ghz.
to 31,150 Ghz. The use of these frequencies is governed by Resolution
869SC/98, as amended.
Smartel has applied for modifications to the build out schedule under its
licenses due to the fact that certain of the equipment to be used by it is still
in the testing phase. The Company expects that each of these requests for
modification will be granted.
FORMUS ARGENTINA
Bands: E Band which totals 575 MHz and consists of the following
frequencies: 25.85 to 26.35 GHz and 29.175 to 29.25 GHz (awarded
November 1998). This spectrum assignment may initially be used only in
the following cities: AMBA (Area Multiple Buenos Aires), La Plata and
Cordoba.
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Services: Data transmission, value added and videoconferencing (awarded
September and November 1998).
Formus Argentina has applied for modifications to the build out schedule under
its licenses due to the fact that certain of the equipment to be used by it is
still in the testing phase. The Company expects that each of these requests for
modification will be granted.
FORMUS COLOMBIA
Bands: 300 MHz at 38 GHz; channels 13, 14, 17 (awarded November 1998).
The license fees for the 38 GHz spectrum license has been increased
from approximately US$222,000 to approximately US$534,000. This
increase is effective for the year 2000 payment due January 2000.
Services: Local carrier and value added (awarded August 1998 and May
1999)
Formus Colombia may be slightly delayed in connection with its implementation
deadline of the end of November 1999. The Company believes that any delay will
be slight and will not have a material adverse effect on its license.
FORMUS PERU
Bands: 400 MHz at 38 GHz; channels 1-4 (awarded May 1999).
Services: Local carrier and value added (awarded April 1999).
INTERLOOP COLOMBIA
1. License to provide Basic Commuted Telephone Service in Colombia.
Such license was granted by Resolution 4262 issued on 9/23/97, expiring
on 12/23/2007, the scope of this license shall be for the territory of
Santa Fe de Bogota, DC (Departamento de Curdinamarca), Cali
(Departamento de Valle del Cauca), Medellin (Departamento de
Antioquia), Barranquilla (Departamento de Atlantico), Bucaramanga
(Departamento de Santander), Cartagena (Departamento de Bolivar), Santa
Marta (Departamento de Magdalena), Pereira (Departamento de Risaralda),
Cucuta (Departamento del Norte de Santander) y Villavicencio
(Departamento del Meta);
2. License to provide Value Added Services, Telematics services, and
the constitution of an Associate Value Added Services Network, which
was granted by Resolucion 4472 issued on 10/10/97 expiring on
10/10/2007.
3. Interloop Colombia was authorized to use the radioelectric spectrum
as per Resolution 5195 issued on 29/12/97. By Resolution 106 of 1999,
Interloop was authorized to use exclusively bands 23 y 3.4 Ghz within
the cities where it had been awarded with a License until 9/22/2007.
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Interloop Colombia is not in compliance with certain of its build out
obligations and may face fines or revocation of its license.
ODECAR S.A.
Odecar S.A. was assigned, on December 14, 1999, per Resolution No. 404.99 of the
Direccion Nacional de Comunicaciones of Uruguay, the radioelectric sub-blocks
24.600 GHz - 24.850 GHz in Montevideo and 25,100 GHz - 25.350 GHZ, 25.600 GHZ -
25.850 GHz and 26.100 GHz - 26.350 GHz in Maldonado for use in providing
commercial data transmission service.
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SCHEDULE 4.20
LIABILITIES
PLEASE SEE SCHEDULE 4.18 FOR POTENTIAL LIABILITIES
UNDER CERTAIN LICENSES HELD BY THE COMPANIES.
THE COMPANY
1. The Company has posted a US$1 million guarantee in respect of a
license bid in Uruguay which will be replaced by a US$300,000
performance bond.
VELOCOM BRASIL
Guarantee for three months of rent payments by VeloCom Brasil of
Charles Schneider's residential lease in Sao Paulo, Brazil.
VESPER
1. Liabilities under cell site and switch site leases entered into by
Vesper.
2. Vesper has guaranteed the residential leases of the following
employees of Vesper:
(a) William Dunbar
(b) Luis Gentil
(c) Norman Gaudreau
(d) Jim Greenlaw
(e) Paul Newman
(f) Pamela Goossen
(g) Timothy Quinn
(h) Francisco Neves Filho
(i) Jean Provencher
(j) Jacques Despars
(k) Charles Laflamme
(l) Edmund del Sol
(m) Sebastian Poisson
(n) Yuan Ringuetti
3. Capitalized Leases pursuant to that certain Leasing Agreement with
IBM Brasil Leasing Arrendamento Mercantil S.A. in the total amount of
$1,800,000.
4. Debt incurred pursuant to that certain loan facility agreement
between Vesper S.A. and Nortel dated as of October 25, 1999.
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125
5. Debt incurred pursuant to note purchase agreements dated December
16, 1999 between Vesper S.A. and Ericsson Telecomunicacoes S.A., Nortel
and Harris Corporation Networks.
6. Debt incurred pursuant to Motorola CPE Supply Agreement and related
vendor financing.
VESPER HOLDINGS
1. Guaranty of Indebtedness of Vesper set forth in number 6 above.
MEGATEL
1. Liabilities under cell site and switch site leases entered into by
MegaTel.
2. MegaTel has guaranteed the residential leases of the following
employees of MegaTel:
(a) Norman Taylor
(b) Giles Leclerc
(c) Roland L'Esperance
(d) Claude Page
(e) Monique Baril
(f) Francois Levesque
(g) Robin Constantin
(h) Rene Quenneville
(i) Roger Croteau
(j) Francois Cote
(k) Glenda Maillaux
(l) Denis Dion
(m) Keith Knox
3. Bridge loan facility by Lucent to MegaTel under the Equipment Supply
Agreement dated September 27, 1999.
4. Debt Pursuant to Credit Agreement dated December 27, 1999.
5. Debt incurred pursuant to Motorola CPE Supply Agreement and related
vendor financing.
VESPER SAO PAULO HOLDING
1. Guaranty of Indebtedness of Megatel set forth in number 4 above.
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TMC
1. Pursuant to the Lease Contract, dated March 12, 1999 between Eduardo
Manuel Stigol (Lessor) and Rigoberto Almeida Costa (Lessee). Guarantee
for three months of rent payments by TMC of Mr. Costa's residential
lease in Buenos Aires, Argentina.
2. Liabilities under cell site and switch site leases entered into by
TMC.
VELOCOM ARGENTINA
1. VeloCom Argentina has agreed to pay the residential lease for Derek
Koecher.
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SCHEDULE 4.22(a)
COLLECTIVE BARGAINING AGREEMENTS
OR EMPLOYMENT AGREEMENTS NOT TERMINABLE AT WILL
VESPER
As of the date hereof, there exists no agreement between Vesper and any
union. However, Vesper will need to enter into a collective beginning
agreement with the union of telecommunication workers.
MEGATEL
As of the date hereof, there exists no agreement between MegaTel and
any union. However, MegaTel will need to enter into a collective
beginning agreement with the union of telecommunication workers.
TMC
1. Collective Bargaining Agreements: TMC is not currently making
payments according to any collective bargaining agreement, but there is
a risk that certain of its employees be deemed to be included under the
following collective bargaining agreements:
(i) Collective Bargaining Agreement for Commercial Employees
("CBACE") Nbr. 130/7.
(ii) FOEESITRA (Federacion de Obreros, Especialistas y Empleados de
los Servicios e Industria de las Telecomunicaciones de la
Republica Argentina).
(iii) Traveling Salesman Collective Bargaining Agreement for
traveling salesmen, Nbr. 308/75.
No dispute, arbitration, litigation or breach exists under any
collective bargaining agreement.
2. TMC Employment Agreements which are not terminable at will without
making severance payments:
NAME OF THE EMPLOYEE:
ALVAREZ Jose Luis
ARCE Walter Javier
ASEF Felix Nadir
BERTOLA Marcelo E.
BLAUZWIRN LABORDE Pablo Ernesto
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NAME OF THE EMPLOYEE:
BOSSIO Rafael
BRAVO Ricardo Luis
BURGUENO SCALONE Juan Manuel
CARBONE LORENA Alejandra
CAZENAVE Luciana
CHOROVICZ Demian
COCCIOLO Roberto Anibal
COCIMANO Daniel
CONTSOMANOLAKY Alejandro
CRISTALLO Alejandro
CUESTA Fernando Anibal
DE LUQUE Mariano
ESCALA Nestor Alberto
ESPERON Jose Luis
FERNANDEZ Maria Jose
FERNANDEZ Nestor
FOURCADE Juan Edgardo
ADRIANO GALLINEA Fabio
GARCIA Jose
GARCIA Natalia
GERARDI Maximiliano
GORINI Fernando Gabriel
GRANJA Anabella Dafne
HORVAT Jacobo
IGLESIAS Sergio Gustavo
IGOUNET Maria Jose
IURCOVICH Patricia
JANCZUK Juan Carlos
JOVENICH Victor Augusto
KRAEFFT Mariano Ricardo
L`AVENA Teresa Haydee
LISJAK Ariel
LOPEZ Pablo David
MEDINA Felix Adolfo
MELERO Roberto Eduardo
MENDEZ GUERIN Nicolas
MERLIS Alfredo Guillermo
MOIX Roman Angel
MOLLO FREYTAZ Carlos
MOREY Gustavo Nicolas
MUSUMECI Sergio Dario
NUGUER Karina
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NAME OF THE EMPLOYEE:
PELIZZA Luis Jorge
PEREYRA Ricardo Hector
PONCE Maria Sandra
RICKE William
ROBLEDO Mabel
ROMEO Mariano
RUBIN Ubaldo
RUIZ Maria Alejandra
SAINT - JEAN Pedro Miguel
SALAS GRABOLO Gustavo
SAWON Ricardo
SCOTTI Alejandro
TIBALDO Mauricio Edgardo
TORRES Julio Oscar
VENENATI Mariano
VILLALBA Eduardo Humberto
VILLECO Diego
ZAIDEL Alejandro
ZAYAT Gonzalo Manuel
ZUMARRAGA Juan Pablo
VELOCOM ARGENTINA
VeloCom Argentina employment agreements which are not terminable at
will without making severance payments:
1. Rudolfo Pella
2. Ana Guiqou
In addition, this entity is responsible for social security "OSDE"
benefits for these employees.
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SCHEDULE 4.22(b)
EMPLOYEES AND DIRECTORS OF THE COMPANY
TERM OF
EMPLOYEE POSITION SALARY BENEFITS EMPLOYMENT*
-------- -------- ------ -------- -----------
Fred Vierra Chairman - Non-Employee $ 12,000.00 $ 3,600.00 At Will
David Leonard President & CEO $ 300,000.00 $ 90,000.00 At Will
Nick Kauser Chief Technology Officer $ 120,000.00 $ 36,000.00 At Will
Barry Rowan Chief Financial Officer $ 225,000.00 $ 52,500.00 At Will
John Gowen Chief Development Officer $ 200,000.00 $ 60,000.00 At Will
Michael Quinn VP Legal & Strategic Affairs $ 250,000.00 $ 75,000.00 At Will
Greg Sadler VP Finance $ 150,000.00 $ 45,000.00 At Will
Dwayne House VP Operations $ 150,000.00 $ 45,000.00 At Will
Mike Casullo VP - Info Technology $ 110,000.00 $ 33,000.00 At Will
David Tomizuka VP - Internet Strategy & Bus. Dev. $ 200,000.00 $ 60,000.00 At Will
Mark Johnson VP - IP Services $ 110,000.00 $ 33,000.00 At Will
Ann Doris VP - Marketing Strategy/Communications $ 175,000.00 $ 51,000.00 At Will
Derek Koecher Financial Analyst $ 65,000.00 $ 19,500.00 At Will
Patti Reichman Controller $ 90,000.00 $ 27,000.00 At Will
Julia K. Hughes Executive Assistant $ 45,000.00 $ 13,500.00 At Will
MIS Manager $ 35,000.00 $ 10,500.00 At Will
Lisa Gamel Administrative Assistant $ 33,000.00 $ 9,900.00 At Will
Wendy Shantz Administrative Assistant $ 40,000.00 $ 12,000.00 At Will
Receptionist/Admin Assist $ 29,000.00 $ 9,000.00 At Will
Brad Johnson VP Southern Cone $ 225,000.00 $ 67,500.00 At Will
Steve Dougherty VP Brazil $ 250,000.00 $ 75,000.00 At Will
Chuck Schneider Brazil CFO $ 150,000.00 $ 45,000.00 At Will
Henry Peraza Pres-Brazil Sm Markets $ 150,000.00 $ 45,000.00 At Will
Barney Schotters Board Member - Non Employee $ 12,000.00 $ -
Bob McKenzie Board Member - Non Employee $ 12,000.00 $ -
Diego Rodriguez Director of Transition Management $ 120,000.00 $ -
Phil Shoemaker Director of Implementation and $ 110,000.00 $ 33,000.00
Deployment
through Brazil and Argentina:
Guillermo Ramirez Senior Project Manager $ 97,750.00 $ 29,000.00
Ana Guigou Argentina Admin $ 35,000.00 $ 10,500.00 At Will
Cristina Diegues Secretary $ 29,750.00 $ 3,000.00 At Will
Naomi Periera Secretary $ 25,000.00 $ 18,000.00 At Will
Rudolfo Pella Argentine Engineer $ 65,000.00 $ 19,500.00 At Will
Antonio de Salles Operations Manager $ 125,000.00 $ 36,000.00 At Will
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SCHEDULE 4.23
EMPLOYEE BENEFIT PLANS
VELOCOM
1. VeloCom Stock Option Plan.
2. VeloCom Death and Disability Plan.
3. Vision Care Plan.
4. Humana Medical PPO Plan.
5. Reliant Life Insurance Plan.
6. Delta Dental Plan.
VESPER
Vesper executive compensation package.
MEGATEL
MegaTel executive compensation package.
TMC
1. Insurance policy No. 1996 of Generali Argentina Compania de Seguros
Patrimoniales regarding labor risk of employees.
2. Tickets for buying at restaurants "Ticket Restaurant" ($ 10 per
employee for each working day) and Tickets for buying other goods
"Ticket Canasta" ($ 150 per employee, per month).
3. Social security "OSDE", "Docthos", "OSECAC" and Accion Social de
Empresarios for employees.
4. Difference of price of social security (Argentine pesos 35 per
month) in favor of Carlos Esteban Castro.
5. Other benefits arising out of the labor agreements entered into by:
(i) Rigoberto Almeida Costa, TMC and Fabio Adriano Gallinea, and (ii)
William Ricke.
6. TMC has agreed to institute a phantom stock option plan for senior
management by year end. This stock option plan is subject to the
approval of the Company's board of directors.
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SCHEDULE 4.24
RECORDKEEPING COMPLIANCE
VELOCOM CHILE
VeloCom Chile has not filed certain monthly tax reports with Chilean
tax authorities. The Company is in the process of making such filings.
FORMUS ARGENTINA
Certain tax documents are in the process of being filed.
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