WARRANTY AGREEMENT
By this Warranty Agreement (the "Agreement"), executed and entered into in the
City of Sao Paulo, SP, Brazil, on the twentieth day of June, 2000, by and among
the parties below, on one side;
1. FiberCore, Inc., a company duly organized and validly existing under the laws
of the State of Nevada, United States of America, with head offices at 000,
Xxxxxxxxx Xxxx, Xxxxxxxx, XX ("FCI"), herein duly represented by its authorized
representative, or any other company or individual to be designated by it (FCI
and/or whichever entity so designated by FCI, hereinafter referred to as the
"Investor");
and, on the other side,
2. Xxxxx X.X. - Empreendimentos e Participacoes, a company duly organized and
validly existing under the laws of the Federal Republic of Brazil, with head
offices in the City of Uberlandia, State of Minas Gerais, at Xxxxxxx Xxxxxxxxxxx
Xxxxxx, 0000, Distrito Industrial, enrolled with CNPJ under No.
17.835.026/0001-52, herein represented by its duly authorized representative
(hereinafter referred to as "Algar"); and
3. Xtal Fibras Opticas S.A., a corporation duly organized and validly existing
under the laws of the Federal Republic of Brazil, with head offices in the City
of Uberlandia, State of Minas Gerais, at Xxxxxxx Xxxxxxxxxxx Xxxxxx, 0000,
Distrito Industrial,. enrolled with CNPJ under No. 71.340.707/0001-95, herein
represented by its duly authorized representative (hereinafter referred to as
the "Xtal");
4. Mamore Participacoes S.A., a corporation duly organized and validly existing
under the laws of the Federal Republic of Brazil, Federal Republic of Brazil,
with head offices in the City of Uberlandia, State of Minas Gerais, at Xxxxxxx
Xxxxxxxxxxx Xxxxxx, 0000, cj. 07, Sala A, Distrito Industrial, enrolled with
CNPJ under No. 03.509.491/0001-99, herein represented by its duly authorized
representative (hereinafter referred to as the "Company");
Whereas, the parties executed an Investment Agreement (the "Investment
Agreement") on June 1, 2000 for an investment in the Company by FCI;
Whereas, one of the conditions precedent for the execution of the Investment
Agreement was that FCI would provide to Algar a warranty in the amount
corresponding to the total value of debt that Algar had guaranteed on behalf of
Xtal Fibras Opticas S.A. ("Xtal");
Whereas, the Parties intend to legally formalize all the terms and conditions
which shall apply to the transactions described in the foregoing recitals;
Now, therefore, in view of the mutual promises, covenants and agreements
contained herein, and intending to be legally bound, the Parties have agreed to
execute this Agreement, pursuant to the following terms and conditions:
1. FCI hereby expressly guarantees to Algar that FCI and Xtal will be
responsible for the payment of the loan agreements ("Loans") and letters of
credit ("Letters of Credit") of Xtal attached hereto as Annex A, that Algar
has guaranteed for the benefit of Xtal.
2. In the event that Xtal defaults on the payment of the Loans or the Letters
of Credit attached in the Annex A ("Default") and Algar has to perform
under its guarantees, FCI shall be liable to Algar for any amounts that
Algar has disbursed in connection with such warranty.
2.1. In the event of a Default, Algar shall notify FCI before the payment
of warranty and FCI shall have the right to pay the amounts due
directly to the creditors, and FCI shall provide to Algar a document
evidencing the release of the warranty.
2.2. In the event FCI is unable to pay directly to the creditors and
Algar is obligated to pay the creditors, Algar shall notify FCI and
present all the documents related to the disbursement effected by
Algar in connection with the Default and FCI shall have 5 (five)
business days to pay Algar for such disbursement, plus all costs
incurred by Algar from the date of disbursement until the payment by
FCI.
3. FCI will use its best efforts to have Algar's guarantees listed in Annex A
released, and to the extent such releases are not obtained by August 31,
2000, then FCI shall pay to Algar or to any company indicated by Algar, all
the costs incurred by Algar to maintain such guarantees until such time as
such guarantees are released. Notwithstanding any provision herein, FCI
shall cause Algar to be fully and completely released of all Algar's
guarantees listed in Annex A on or before September 30, 2000. Algar shall
be under no obligation to renew or extend any of such guarantees.
4. Any notices, requests, claims, demands, instructions and other
communications to be given hereunder to any party shall be in writing and
delivered in person, sent by certified mail, postage prepaid, return
receipt requested, or by facsimile transmission with a confirmed telephonic
transmission answer back, to the following addresses (or at such other
address or number as is given in writing by other party to the other
pursuant hereto):
If to Investor: FiberCore, Inc.
X.X. XXX 000
000 Xxxxxxxxx Xxxx
Xxxxxxxx, XX 00000, U.S.A
Att: Xx. Xxxx Xxxxxx
If to Algar: Xxxxx X.X. - Empreendimentos e Participacoes
Xxxxxxx Xxxxxxxxxxx Xxxxxx, 0000
Xxxxxxxx Xxxxxxxxxx, Xxxxxxxxxx
Att: Xxxxxx Xxxxxxxx Xxxx
If to Xtal: Xtal Fibras Opticas S.A.
Xxxxxxx Xxxxxxxxxxx Xxxxxx, 0000 - Sala 0
Xxxxxxxx Xxxxxxxxxx, Xxxxxxxxxx
Att: Xxxxxxx Xxxxxx xx Xxxxxx
If to Company: Mamore Participacoes S.A.
Xxxxxxxxxxx Xxxxxx, 0000, cj. 00, Xxxx X
Xxxxxxxx Xxxxxxxxxx, Xxxxxxxxxx
Att: Xxxxxxx Xxxxxx xx Xxxxxx
5. This Agreement may be amended only upon the mutual written consent of the
Parties hereto.
6. This Agreement, including the Annexes and Exhibits hereto, constitutes the
entire agreement between the Parties with respect to the subject matter
hereof and supersedes all prior agreements and understandings between the
parties. There are no representations, warranties, undertakings or
agreements between the parties with respect to the subject matter of this
Agreement except as set forth herein.
7. None of the parties hereto may assign its rights, interests, obligations or
liabilities under this Agreement or delegate its duties without the prior
written consent of the other party. This Agreement and all of the
provisions and Annexes hereof shall be binding upon and inure to the
benefit of the parties hereto and their respective successors and permitted
assigns.
8. This Agreement shall be governed by, and construed in accordance with, the
laws of Brazil. The courts of the City of Sao Paulo, State of Sao Paulo, to
the personal jurisdiction of which each party hereto voluntarily submits,
shall have exclusive jurisdiction over any dispute arising out of the
construction, interpretation or enforcement of this Agreement.
In witness whereof, the Parties have executed this Agreement in 5 (five)
counterparts of same tenor and content, on the date and in the place herein
before stated, in the presence of the two undersigned witnesses.
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FiberCore, Inc.
By: Xxxx X. Xxxxxx
Title: President - Chief Executive
Officer
-----------------------------------
Xxxxx X.X.
By: Xxxx Xxxxx Xxxx Costa
Title: Chief Executive Officer
By: Xxxxxx Xxxxxxxx Xxxx
Title: Attorney-in-fact
-----------------------------------
Xtal Fibras Opticas S.A.
By: Xxxx Xxxxx Xxxx Costa
Title: President
By: Antonio Xxxxxx Xxxxxx
Title: Managing Director
-----------------------------------
Mamore Participacoes S.A.
By: Xxxx Xxxxx Xxxx Costa
Title: Attorney-in-fact
By: Xxxxxx Xxxxxxxx Xxxx
Title: Attorney-in-fact
Witnesses:
1.
------------------------------------
Name: Giseli Xxxxxxxxx Xxxxx Xxxxxx
XX: 16.978.964
CPF: 000.000.000-00
2.
------------------------------------
Name: Xxxxxx Xxxxxxx Mari
RG: 8.690.203
CPF: 000.000.000-00
