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EXHIBIT 10.26.6
EXHIBIT F
PARENT PLEDGE AGREEMENT dated as of September 17, 1999, among LEAP
WIRELESS INTERNATIONAL, INC., a Delaware corporation (the "Parent") and STATE
STREET BANK AND TRUST COMPANY, as collateral agent (in such capacity, the
"Collateral Agent") for the Secured Parties.
Reference is made to the Collateral Agency and Intercreditor Agreement
dated as of September 17, 1999 (as amended, supplemented or otherwise modified
from time to time, the "Collateral Agency and Intercreditor Agreement") among
Cricket Wireless Communications, Inc., a Delaware corporation (the "Borrower"),
the Representatives and Unrepresented Holders referred to therein and the
Collateral Agent. Capitalized terms used herein and not defined herein shall
have the meanings assigned to such terms in the Collateral Agency and
Intercreditor Agreement. The Parent acknowledges receipt of a true and correct
copy of the Collateral Agency and Intercreditor Agreement and agrees to the
terms thereof.
The Lenders have agreed to make Loans to the Borrower pursuant to, and
upon the terms and subject to the conditions specified in, the Credit Agreement.
The Borrower is a subsidiary of the Parent. The obligations of the Lenders to
make Loans are conditioned upon, among other things, the execution and delivery
by the Parent of a Pledge Agreement in the form hereof. The Borrower may from
time to time incur Permitted Additional Obligations that are required to be
secured pursuant to the terms hereof.
Accordingly, the Parent and the Collateral Agent, on behalf of itself
and each Secured Party (and each of their respective successors or assigns),
hereby agree as follows:
SECTION 1. Pledge. As security for the payment and performance, as the
case may be, in full of the Obligations, the Parent hereby transfers, grants,
bargains, sells, conveys, hypothecates, pledges, sets over and delivers unto the
Collateral Agent, its successors and assigns, and hereby grants to the
Collateral Agent, its successors and assigns, for the ratable benefit of the
Secured Parties, a security interest in all of the Parent's right, title and
interest in, to and under (a), the shares of capital stock, membership interests
or other, equity interests of the Borrower or any Subsidiary Loan Party owned by
it and listed on Schedule I hereto and any shares of the Borrower or any
Subsidiary Loan Party obtained in the future by the Parent and the certificates
representing all such shares,
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membership interests or other equity interests (collectively, the "Pledged
Stock"); provided that the pledged interests shall not include to the extent
that applicable law requires that the Borrower or any Subsidiary Loan Party
issue directors' qualifying shares, such qualifying shares; (b)(i) all debt
securities issued by the Borrower or any Subsidiary Loan Party owned by it, all
of which are listed on Schedule I hereto, (ii) any debt securities in the future
issued to the Parent by the Borrower or any Subsidiary Loan Party and (iii) the
promissory notes and any other instruments evidencing such debt securities (the
"Pledged Debt Securities"); (c) all other property that may be delivered to and
held by the Collateral Agent pursuant to the terms hereof; (d) subject to
Section 5, all payments of principal or interest, dividends, cash, instruments
and other property from time to time received, receivable or otherwise
distributed, in respect of, in exchange for or upon the conversion of the
securities referred to in clauses (a) and (b) above; (e) subject to Section 5,
all rights and privileges of the Parent with respect to the securities and other
property referred to in clauses (a), (b), (c) and (d) above; and (f) all
proceeds of any of the foregoing (the items referred to in clauses (a) through
(f) above being collectively referred to as the "Collateral"). Upon delivery to
the Collateral Agent, (a) any stock certificates, notes or other securities now
or hereafter included in the Collateral (the "Pledged Securities") shall be
accompanied by stock powers duly executed in blank or other instruments of
transfer satisfactory to the Collateral Agent and by such other instruments and
documents as the Collateral Agent may reasonably request in order to give effect
to the pledge granted hereby and (b) all other property comprising part of the
Collateral shall be accompanied by proper instruments of assignment duly
executed by the Parent and such other instruments or documents as the Collateral
Agent may reasonably request in order to give effect to the pledge granted
hereby. Each delivery of Pledged Securities shall be accompanied by a schedule
describing the securities theretofore and then being pledged hereunder, which
schedule shall be attached hereto as Schedule I and made a part hereof. Each
schedule so delivered shall supersede any prior schedules so delivered.
TO HAVE AND TO HOLD the Collateral, together with all right, title,
interest, powers, privileges and preferences pertaining or incidental thereto,
unto the Collateral Agent,
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its successors and assigns, for the ratable benefit of the Secured Parties,
forever; subject, however, to the terms, covenants and conditions hereinafter
set forth.
SECTION 2. Delivery of the Collateral. (a) The Parent agrees promptly to
deliver or cause to be delivered to the Collateral Agent any and all Pledged
Securities and any and all certificates or other instruments or documents
representing the Collateral.
(b) The Parent will cause any Indebtedness for borrowed money owed to
the Parent by the Borrower or any Subsidiary Loan Party to be evidenced by a
duly executed promissory note, bond, debenture or similar instrument that is
pledged and delivered to the Collateral Agent pursuant to the terms thereof.
SECTION 3. Representations, Warranties and Covenants. The Parent hereby
represents, warrants and covenants, as to itself and the Collateral pledged by
it hereunder, to and with the Collateral Agent that as of the Effective Date:
(a) the Pledged Stock represents that percentage as set forth on
Schedule I of the issued and outstanding shares of each class of the capital
stock of the issuer with respect thereto;
(b) except for the security interest granted hereunder, the Parent (i)
is and will at all times continue to be the direct owner, beneficially and of
record, of the Pledged Securities indicated on Schedule I, (ii) holds the same
free and clear of all Liens, (iii) will make no assignment, pledge,
hypothecation or transfer of, or create or permit to exist any security interest
in or other Lien on, the Collateral, other than pursuant hereto, and (iv)
subject to Section 5, will cause any and all Collateral, whether for value paid
by the Parent or otherwise, to be forthwith deposited with the Collateral Agent
and pledged or assigned hereunder;
(c) the Parent (i) has the power and authority to pledge the Collateral
in the manner hereby done or contemplated and (ii) will defend its title or
interest thereto or therein against any and all Liens (other than the Lien
created by this Agreement), however arising, of all Persons whomsoever;
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(d) except for such consents and approvals as have been obtained and are
in full force and effect, no consent of any other Person (including stockholders
or creditors of the Parent) and no consent or approval of any Governmental
Authority or any securities exchange was or is necessary to the validity of the
pledge effected hereby;
(e) by virtue of the execution and delivery by the Parent of this
Agreement, when the Pledged Securities, certificates or other documents
representing or evidencing the Collateral are delivered to, and continue to be
in the possession of, the Collateral Agent in accordance with this Agreement,
the Collateral Agent will have a valid and perfected first lien upon and
security interest in such Pledged Securities as security for the payment and
performance of the Obligations;
(f) the pledge effected hereby is effective to vest in the Collateral
Agent, on behalf of the Secured Parties, the rights of the Collateral Agent in
the Collateral as set forth herein;
(g) all of the Pledged Stock has been duly authorized and validly issued
and is fully paid and nonassessable;
(h) all information set forth herein relating to the Pledged Stock is
accurate and complete in all material respects as of the date hereof; and
(i) the pledge of the Pledged Stock pursuant to this Agreement does not
violate Regulation U or X of the Federal Reserve Board or any successor thereto
as of the date hereof.
SECTION 4. Registration in Nominee Name; Denominations. The Collateral
Agent, on behalf of the Secured Parties, shall have the right (in its sole and
absolute discretion) to hold the Pledged Securities in its own name as pledgee,
the name of its nominee (as pledgee or as sub-agent) or the name of the Parent,
endorsed or assigned in blank or in favor of the Collateral Agent. The Parent
will promptly give to the Collateral Agent copies of any material notices or
other communications received by it with respect to Pledged Securities
registered in the name of the Parent. The Collateral Agent shall at all times
have the right to exchange the certificates representing Pledged
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Securities for certificates of smaller or larger denominations for any purpose
consistent with this Agreement.
SECTION 5. Voting Rights; Dividends and Interest, etc. (a) Unless and
until a Notice of Enforcement is in effect:
(i) The Parent shall be entitled to exercise any and all voting
and/or other consensual rights and powers inuring to an owner of Pledged
Securities or any part thereof for any purpose consistent with the terms
of this Agreement, the other Support Documents and the Secured
Instruments; provided, however, that the Parent will not be entitled to
exercise any such right if the result thereof could materially and
adversely affect the rights inuring to a holder of the Pledged
Securities or the rights and remedies of any of the Secured Parties
under this Agreement or any other Support Document or Secured Instrument
or the ability of the Secured Parties to exercise the same.
(ii) The Collateral Agent shall execute and deliver to the
Parent, or cause to be executed and delivered to the Parent, all such
proxies, powers of attorney and other instruments as the Parent may
reasonably request for the purpose of enabling the Parent to exercise
the voting and/or consensual rights and powers it is entitled to
exercise pursuant to subparagraph (i) above and to receive the cash
dividends it is entitled to receive pursuant to subparagraph (iii)
below.
(iii) The Parent shall be entitled to receive and retain any and
all cash dividends, interest and principal paid on the Pledged
Securities to the extent and only to the extent that such cash
dividends, interest and principal are permitted by, and otherwise paid
in accordance with, the terms and conditions of the Support Documents,
the Secured Instruments and applicable laws. While a Notice of
Enforcement is in effect, all noncash dividends, interest and principal,
and all dividends, interest and principal paid or payable in cash or
otherwise in connection with a partial or total liquidation or
dissolution, return of capital, capital surplus or paid-in surplus, and
all
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other distributions (other than distributions referred to in the
preceding sentence) made on or in respect of the Pledged Securities,
whether paid or payable in cash or otherwise, whether resulting from a
subdivision, combination or reclassification of the outstanding capital
stock of the issuer of any Pledged Securities or received in exchange
for Pledged Securities or any part thereof, or in redemption thereof, or
as a result of any merger, consolidation, acquisition or other exchange
of assets to which such issuer may be a party or otherwise, shall be and
become part of the Collateral, and, if received by the Parent, shall not
be commingled by the Parent with any of its other funds or property but
shall be held separate and apart therefrom, shall be held in trust for
the benefit of the Collateral Agent and shall be forthwith delivered to
the Collateral Agent in the same form as so received (with any necessary
endorsement).
(b) While a Notice of Enforcement is in effect, all rights of the Parent
to dividends, interest or principal that the Parent is authorized to receive
pursuant to paragraph (a)(iii) above shall cease, and all such rights shall
thereupon become vested in the Collateral Agent, which shall have the sole and
exclusive right and authority to receive and retain such dividends, interest or
principal. All dividends, interest or principal received by the Parent contrary
to the provisions of this Section 5 shall be held in trust for the benefit of
the Collateral Agent, shall be segregated from other property or funds of the
Parent and shall be forthwith delivered to the Collateral Agent upon demand in
the same form as so received (with any necessary endorsement). Any and all money
and other property paid over to or received by the Collateral Agent pursuant to
the provisions of this paragraph (b) shall be retained by the Collateral Agent
in the Enforcement Collateral Account upon receipt of such money or other
property and shall be applied in accordance with the provisions of Section 7.
After a Notice of Enforcement has been rescinded in accordance with the terms of
the Collateral Agency and Intercreditor Agreement, the Collateral Agent shall,
within five Business Days after all such Notices of Enforcement have been
rescinded, repay to the Parent all cash dividends, interest or principal
(without interest), that the Parent would otherwise be permitted to retain
pursuant to the terms of paragraph (a)(iii) above and which remain in the
Enforcement Collateral Account.
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(c) While a Notice of Enforcement is in effect, all rights of the Parent
to exercise the voting and consensual rights and powers it is entitled to
exercise pursuant to paragraph (a)(i) of this Section 5, and the obligations of
the Collateral Agent under paragraph (a)(ii) of this Section 5, shall cease, and
all such rights shall thereupon become vested in the Collateral Agent, which
shall have the sole and exclusive right and authority to exercise such voting
and consensual rights and powers in a manner not inconsistent with the terms of
this Agreement, provided that, unless otherwise directed by the Required Secured
Parties, the Collateral Agent shall have the right from time to time while a
Notice of Enforcement is in effect to permit the Parent to exercise such rights.
After all Notices of Enforcement have been rescinded in accordance with the
terms of the Collateral Agency and Intercreditor Agreement, the Parent will have
the right to exercise the voting and consensual rights and powers that it would
otherwise be entitled to exercise pursuant to the terms of paragraph (a)(i)
above.
SECTION 6. Remedies upon Default. While a Notice of Enforcement is in
effect, subject to applicable regulatory and legal requirements, the Collateral
Agent may sell the Collateral, or any part thereof, at public or private sale or
at any broker's board or on any securities exchange, for cash, upon credit or
for future delivery as the Collateral Agent shall deem appropriate subject to
applicable law and standards of commercial reasonableness. The Collateral Agent
shall be authorized at any such sale (if it deems it advisable to do so) to
restrict the prospective bidders or purchasers to Persons who will represent and
agree that they are purchasing the Collateral for their own account for
investment and not with a view to the distribution or sale thereof, and upon
consummation of any such sale the Collateral Agent shall have the right to
assign, transfer and deliver to the purchaser or purchasers thereof the
Collateral so sold. Each such purchaser at any such sale shall hold the property
sold absolutely free from any claim or right on the part of the Parent, and, to
the extent permitted by applicable law, the Parent hereby waives all rights of
redemption, stay, valuation and appraisal the Parent now has or may at any time
in the future have under any rule of law or statute now existing or hereafter
enacted.
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The Collateral Agent shall give the Parent 10 days' prior written notice
(which the Parent agrees is reasonable notice within the meaning of Section
9-504(3) of the Uniform Commercial Code as in effect in the State of New York or
its equivalent in other jurisdictions) of the Collateral Agent's intention to
make any sale of the Parent's Collateral. Such notice, in the case of a public
sale, shall state the time and place for such sale and, in the case of a sale at
a broker's board or on a securities exchange, shall state the board or exchange
at which such sale is to be made and the day on which the Collateral, or portion
thereof, will first be offered for sale at such board or exchange. Any such
public sale shall be held at such time or times within ordinary business hours
and at such place or places as the Collateral Agent may fix and state in the
notice of such sale. At any such sale, the Collateral, or portion thereof, to be
sold may be sold in one lot as an entirety or in separate parcels, as the
Collateral Agent may (in its sole and absolute discretion) determine. The
Collateral Agent shall not be obligated to make any sale of any Collateral if it
shall determine not to do so, regardless of the fact that notice of sale of such
Collateral shall have been given. The Collateral Agent may, without notice or
publication, adjourn any public or private sale or cause the same to be
adjourned from time to time by announcement at the time and place fixed for
sale, and such sale may, without further notice, be made at the time and place
to which the same was so adjourned. In case any sale of all or any part of the
Collateral is made on credit or for future delivery, the Collateral so sold may
be retained by the Collateral Agent until the sale price is paid in full by the
purchaser or purchasers thereof, but the Collateral Agent shall not incur any
liability in case any such purchaser or purchasers shall fail to take up and pay
for the Collateral so sold and, in case of any such failure, such Collateral may
be sold again upon like notice. Subject to Section 9.05 of the Collateral Agency
and Intercreditor Agreement, at any public (or, to the extent permitted by
applicable law, private) sale made pursuant to this Section 6, any Secured Party
may bid for or purchase, free from any right of redemption, stay or appraisal on
the part of the Parent (all said rights being also hereby waived and released),
the Collateral or any part thereof offered for sale. For purposes hereof, (a) a
written agreement to purchase the Collateral or any portion thereof shall be
treated as a sale thereof, (b) the Collateral Agent shall be free to carry out
such sale
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pursuant to such agreement and (c) the Parent shall not be entitled to the
return of the Collateral or any portion thereof subject thereto, notwithstanding
the fact that after the Collateral Agent shall have entered into such an
agreement the applicable Notice of Enforcement shall have been rescinded in
accordance with the terms of the Collateral Agency and Intercreditor Agreement
and the Obligations paid in full. As an alternative to exercising the power of
sale herein conferred upon it, the Collateral Agent may proceed by a suit or
suits at law or in equity to foreclose upon the Collateral and to sell the
Collateral or any portion thereof pursuant to a judgment or decree of a court or
courts having competent jurisdiction or pursuant to a proceeding by a
court-appointed receiver. Any sale pursuant to the provisions of this Section 6
shall be deemed to conform to the commercially reasonable standards as provided
in Section 9-504(3) of the Uniform Commercial Code as in effect in the State of
New York or its equivalent in other jurisdictions.
SECTION 7. Application of Proceeds of Sale. The proceeds of any sale of
Collateral pursuant to Section 6, as well as any Collateral consisting of cash,
shall be applied promptly by the Collateral Agent after receipt thereof as
provided in the Collateral Agency and Intercreditor Agreement.
Upon any sale of the Collateral by the Collateral Agent (including
pursuant to a power of sale granted by statute or under a judicial proceeding),
the receipt of the purchase money by the Collateral Agent or of the officer
making the sale shall be a sufficient discharge to the purchaser or purchasers
of the Collateral so sold and such purchaser or purchasers shall not be
obligated to see to the application of any part of the purchase money paid over
to the Collateral Agent or such officer or be answerable in any way for the
misapplication thereof.
SECTION 8. Reimbursement of Collateral Agent. (a) The Parent agrees to
pay upon demand to the Collateral Agent the amount of any and all reasonable
expenses, including the reasonable fees, other charges and disbursements of its
counsel and of any experts or agents, that the Collateral Agent may incur in
connection with (i) the administration of this Agreement, (ii) the custody or
preservation of, or the sale of, collection from, or other realization upon, any
of the Collateral, (iii) the exercise or enforcement of any of the rights of the
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Collateral Agent hereunder or (iv) the failure by the Parent to perform or
observe any of the provisions hereof.
(b) Without limitation of its indemnification obligations under the
other Support Documents, the Parent agrees to indemnify the Collateral Agent and
the other Indemnitees against, and hold each Indemnitee harmless from, any and
all losses, claims, damages, liabilities and related expenses, including
reasonable counsel fees, other charges and disbursements, incurred by or
asserted against any Indemnitee arising out of, in any way connected with, or as
a result of (i) the execution or delivery of this Agreement or any other Support
Document or any agreement or instrument contemplated hereby or thereby, the
performance by the parties hereto of their respective obligations thereunder or
the consummation of the transactions contemplated hereby or (ii) any claim,
litigation, investigation or proceeding relating to any of the foregoing,
whether or not any Indemnitee is a party thereto, provided that such indemnity
shall not, as to any Indemnitee, be available to the extent that such losses,
claims, damages, liabilities or related expenses have resulted from the gross
negligence or wilful misconduct of such Indemnitee.
(c) Any amounts payable as provided hereunder shall be additional
Obligations secured hereby and by the other Security Documents. The provisions
of this Section 8 shall remain operative and in full force and effect regardless
of the termination of this Agreement or any other Support Document or any
Secured Instrument, the consummation of the transactions contemplated hereby,
the repayment of any of the Obligations, the invalidity or unenforceability of
any term or provision of this Agreement or any other Support Document or any
Secured Instrument or any investigation made by or on behalf of the Collateral
Agent or any other Secured Party. All amounts due under this Section 8 shall be
payable on written demand therefor and, if not paid within five Business Days
after written demand for payment is received by the Parent from the Collateral
Agent, shall bear interest at the rate specified in Section 2.11(c) of the
Credit Agreement.
(d) To the extent that the Parent fails to pay any amount required to be
paid by them to the Collateral Agent under paragraph (a) or (b) of this Section,
each Secured Party severally agrees to pay to the Collateral Agent such Secured
Party's pro rata share (determined as of the time
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that the applicable unreimbursed expense or indemnity payment is sought) of such
unpaid amount; provided that the unreimbursed expense or indemnified loss,
claim, damaged, liability or related expense, as the case may be, was incurred
by or asserted against the Collateral Agent in its capacity as such. For
purposes hereof, a Secured Party's "pro rata share" shall be determined based
upon its share of the sum of the total outstanding loans and unused commitments
under the Secured Instruments at the time.
SECTION 9. Collateral Agent Appointed Attorney-in-Fact. The Parent
hereby appoints the Collateral Agent, effective while a Notice of Enforcement is
in effect, the attorney-in-fact of the Parent for the purpose of carrying out
the provisions of this Agreement and taking any action and executing any
instrument that the Collateral Agent may deem necessary or advisable to
accomplish the purposes hereof, which appointment is irrevocable and coupled
with an interest. Without limiting the generality of the foregoing, the
Collateral Agent shall have the right, while a Notice of Enforcement is in
effect, with full power of substitution either in the Collateral Agent's name or
in the name of the Parent, to ask for, demand, ▇▇▇ for, collect, receive and
give acquittance for any and all moneys due or to become due under and by virtue
of any Collateral, to endorse checks, drafts, orders and other instruments for
the payment of money payable to the Parent representing any interest or dividend
or other distribution payable in respect of the Collateral or any part thereof
or on account thereof and to give full discharge for the same, to settle,
compromise, prosecute or defend any action, claim or proceeding with respect
thereto, and to sell, assign, endorse, pledge, transfer and to make any
agreement respecting, or otherwise deal with, the same, in each case in a manner
not inconsistent with the terms of this Agreement; provided, however, that
nothing herein contained shall be construed as requiring or obligating the
Collateral Agent to make any commitment or to make any inquiry as to the nature
or sufficiency of any payment received by the Collateral Agent, or to present or
file any claim or notice, or to take any action with respect to the Collateral
or any part thereof or the moneys due or to become due in respect thereof or any
property covered thereby. The Collateral Agent and the other Secured Parties
shall be accountable only for amounts actually received as a result of the
exercise of the powers granted to them herein, and neither they nor their
officers,
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directors, employees or agents shall be responsible to the Parent for any act or
failure to act hereunder, except for their own gross negligence or wilful
misconduct.
SECTION 10. Waivers; Amendment. (a) No failure or delay of the
Collateral Agent in exercising any power or right hereunder shall operate as a
waiver thereof, nor shall any single or partial exercise of any such right or
power, or any abandonment or discontinuance of steps to enforce such a right or
power, preclude any other or further exercise thereof or the exercise of any
other right or power. The rights and remedies of the Collateral Agent hereunder
and of the Collateral Agent and the other Secured Parties under the other
Support Documents and the Secured Instruments are cumulative and are not
exclusive of any rights or remedies that they would otherwise have. No waiver of
any provisions of this Agreement or consent to any departure by the Parent
therefrom shall in any event be effective unless the same shall be permitted by
paragraph (b) below, and then such waiver or consent shall be effective only in
the specific instance and for the purpose for which given. No notice or demand
on the Parent in any case shall entitle the Parent to any other or further
notice or demand in similar or other circumstances.
(b) Neither this Agreement nor any provision hereof may be waived,
amended or modified except pursuant to a written agreement entered into between
the Collateral Agent and the Parent, subject to any consent required in
accordance with Section 11.02 of the Collateral Agency and Intercreditor
Agreement.
SECTION 11. Securities Act, etc. In view of the position of the Parent
in relation to the Pledged Securities, or because of other current or future
circumstances, a question may arise under the Securities Act of 1933, as now or
hereafter in effect, or any similar statute hereafter enacted analogous in
purpose or effect (such Act and any such similar statute as from time to time in
effect being called the "Federal Securities Laws") with respect to any
disposition of the Pledged Securities permitted hereunder. The Parent
understands that compliance with the Federal Securities Laws might very strictly
limit the course of conduct of the Collateral Agent if the Collateral Agent were
to attempt to dispose of all or any part of the Pledged Securities, and might
also limit the extent to which or the manner in which any subsequent
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transferee of any Pledged Securities could dispose of the same. Similarly, there
may be other legal restrictions or limitations affecting the Collateral Agent in
any attempt to dispose of all or part of the Pledged Securities under applicable
Blue Sky or other state securities laws or similar laws analogous in purpose or
effect. The Parent recognizes that in light of such restrictions and limitations
the Collateral Agent may, with respect to any sale of the Pledged Securities,
limit the purchasers to those who will agree, among other things, to acquire
such Pledged Securities for their own account, for investment, and not with a
view to the distribution or resale thereof. The Parent acknowledges and agrees
that in light of such restrictions and limitations, the Collateral Agent, in its
sole and absolute discretion, (a) may proceed to make such a sale whether or not
a registration statement for the purpose of registering such Pledged Securities
or part thereof shall have been filed under the Federal Securities Laws and (b)
may approach and negotiate with a single potential purchaser to effect such
sale. The Parent acknowledges and agrees that any such sale might result in
prices and other terms less favorable to the seller than if such sale were a
public sale without such restrictions. In the event of any such sale, the
Collateral Agent shall incur no responsibility or liability for selling all or
any part of the Pledged Securities at a price that the Collateral Agent, in its
sole and absolute discretion, may in good ▇▇▇▇▇ ▇▇▇▇ reasonable under the
circumstances, notwithstanding the possibility that a substantially higher price
might have been realized if the sale were deferred until after registration as
aforesaid or if more than a single purchaser were approached. The provisions of
this Section 11 will apply notwithstanding the existence of a public or private
market upon which the quotations or sales prices may exceed substantially the
price at which the Collateral Agent sells.
SECTION 12. Security Interest Absolute. All rights of the Collateral
Agent hereunder, the grant of a security interest in the Collateral and all
obligations of the Parent hereunder, shall be absolute and unconditional
irrespective of (a) any lack of validity or enforceability any Support Document
or Secured Instrument, any agreement with respect to any of the Obligations or
any other agreement or instrument relating to any of the foregoing, (b) any
change in the time, manner or place of payment of, or in any other term of, all
or any of the Obligations, or any other
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amendment or waiver of or any consent to any departure from any Support Document
or Secured Instrument or any other agreement or instrument relating to any of
the foregoing, (c) any exchange, release or nonperfection of any other
collateral, or any release or amendment or waiver of or consent to or departure
from any guaranty, for all or any of the Obligations or (d) any other
circumstance that might otherwise constitute a defense available to, or a
discharge of, the Parent in respect of the Obligations or in respect of this
Agreement (other than the indefeasible payment in full of all the Obligations).
SECTION 13. Termination or Release. (a) This Agreement and the security
interests granted hereby shall terminate when all the Obligations have been
indefeasibly paid in full and all Secured Instrument Commitments shall have
terminated.
(b) Subject to Section 9.03 of the Collateral Agency and Intercreditor
Agreement, upon any sale or other transfer by the Parent of any Collateral that
does not violate any Secured Instrument to any Person other than Holdings, the
Borrower or any Subsidiary Loan Party, the security interest in such Collateral
shall be automatically released.
(c) In connection with any termination or release pursuant to paragraph
(a) or (b), the Collateral Agent shall execute and deliver to the Parent, at the
Parent's expense, all documents that the Parent shall reasonably request to
evidence such termination or release. Any execution and delivery of documents
pursuant to this Section 13 shall be without recourse to or warranty by the
Collateral Agent.
SECTION 14. Notices. All communications and notices hereunder shall be
in writing and given as provided in Section 11.01 of the Collateral Agency and
Intercreditor Agreement; provided that any communication or notice hereunder to
the Parent shall be given to it at [__________], attention of [__________]
(Telecopy No. [__________]).
SECTION 15. Further Assurances. The Parent agrees to do such further
acts and things, and to execute and deliver such additional conveyances,
assignments, agreements and instruments, as the Collateral Agent may at any time
reasonably request in connection with the administration and enforcement of this
Agreement or with respect to the Collateral or any part thereof or in order
better to assure
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and confirm unto the Collateral Agent its rights and remedies hereunder.
SECTION 16. Binding Effect; Several Agreement; Assignments. Whenever in
this Agreement any of the parties hereto is referred to, such reference shall be
deemed to include the successors and assigns of such party; and all covenants,
promises and agreements by or on behalf of the Parent that are contained in this
Agreement shall bind and inure to the benefit of its successors and assigns.
This Agreement shall become effective as to the Parent when a counterpart hereof
executed on behalf of the Parent shall have been delivered to the Collateral
Agent and a counterpart hereof shall have been executed on behalf of the
Collateral Agent, and thereafter shall be binding upon the Parent and the
Collateral Agent and their respective successors and assigns, and shall inure to
the benefit of the Parent, the Collateral Agent and the other Secured Parties,
and their respective successors and assigns, except that the Parent shall not
have the right to assign its rights hereunder or any interest herein or in the
Collateral (and any such attempted assignment shall be void), except as
expressly contemplated by this Agreement or the other Loan Documents. Subject to
Section 9.03 of the Collateral Agency and Intercreditor Agreement, if all of the
capital stock of the Borrower or a Subsidiary Loan Party is sold, transferred or
otherwise disposed of to a Person other than the Borrower or a Subsidiary Loan
Party pursuant to a transaction that does not violate any Secured Instrument,
such capital stock shall be released from any security interest, lien or
encumbrance created under this Agreement without further action.
SECTION 17. Survival of Agreement; Severability. (a) All covenants,
agreements, representations and warranties made by the Parent herein and in the
certificates or other instruments prepared or delivered in connection with or
pursuant to this Agreement or any other Support Document shall be considered to
have been relied upon by the Collateral Agent and the other Secured Parties and
shall survive the extension of credit by any Secured Party pursuant to a Secured
Instrument, regardless of any investigation made by the Secured Parties or on
their behalf, and shall continue in full force and effect until this Agreement
shall terminate.
(b) In the event any one or more of the provisions
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contained in this Agreement should be held invalid, illegal or unenforceable in
any respect, the validity, legality and enforceability of the remaining
provisions contained herein shall not in any way be affected or impaired thereby
(it being understood that the invalidity of a particular provision in a
particular jurisdiction shall not in and of itself affect the validity of such
provision in any other jurisdiction). The parties shall endeavor in good-faith
negotiations to replace the invalid, illegal or unenforceable provisions with
valid provisions the economic effect of which comes as close as possible to that
of the invalid, illegal or unenforceable provisions.
SECTION 18. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
SECTION 19. Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall constitute an original, but all of which, when
taken together, shall constitute a single contract, and shall become effective
as provided in Section 16. Delivery of an executed counterpart of a signature
page to this Agreement by facsimile transmission shall be as effective as
delivery of a manually executed counterpart of this Agreement.
SECTION 20. Rules of Interpretation. The rules of interpretation
specified in Section 1.02 of the Collateral Agency and Intercreditor Agreement
shall be applicable to this Agreement. Section headings used herein are for
convenience of reference only, are not part of this Agreement and are not to
affect the construction of, or to be taken into consideration in interpreting
this Agreement.
SECTION 21. Jurisdiction; Consent to Service of Process. (a) The Parent
hereby irrevocably and unconditionally submits, for itself and its property, to
the nonexclusive jurisdiction of the Supreme Court of the State of New York
sitting in New York County and of the United States District Court of the
Southern District of New York, and any appellate court from any thereof, in any
action or proceeding arising out of or relating to any this Agreement or any
other Support Document, or for recognition or enforcement of any judgment, and
each of the parties hereto hereby irrevocably and unconditionally agrees that
all claims in respect of any such action or proceeding may be
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heard and determined in such New York State or, to the extent permitted by law,
in such Federal court. Each of the parties hereto agrees that a final judgment
in any such action or proceeding shall be conclusive and may be enforced in
other jurisdictions by suit on the judgment or in any other manner provided by
law. Nothing in this Agreement or any other Support Document shall affect any
right that the Collateral Agent or any other Secured Party may otherwise have to
bring any action or proceeding relating to this Agreement or any other Loan
Document against the Parent or its properties in the courts of any jurisdiction.
(b) The Parent hereby irrevocably and unconditionally waives, to the
fullest extent it may legally and effectively do so, any objection that it may
now or hereafter have to the laying of venue of any suit, action or proceeding
arising out of or relating to this Agreement or any other Support Document in
any New York State or Federal court. Each of the parties hereto hereby
irrevocably waives, to the fullest extent permitted by law, the defense of an
inconvenient forum to the maintenance of such action or proceeding in any such
court.
(c) Each party to this Agreement irrevocably consents to service of
process in the manner provided for notices in Section 14. Nothing in this
Agreement will affect the right of any party to this Agreement to serve process
in any other manner permitted by law.
SECTION 22. WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES, TO
THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL
BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF,
UNDER OR IN CONNECTION WITH THIS AGREEMENT. EACH PARTY HERETO (A) CERTIFIES THAT
NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED,
EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF
LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT
AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY,
AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.
SECTION 23. Execution of Financing Statements. Pursuant to Section 9-402
of the Uniform Commercial Code as in effect in the State of New York, the Parent
authorizes the Collateral Agent to file financing statements with
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respect to the Collateral owned by it without the signature of the Parent in
such form and in such filing offices as the Collateral Agent reasonably
determines appropriate to perfect the security interests of the Collateral Agent
under this Agreement. A carbon, photographic or other reproduction of this
Agreement shall be sufficient as a financing statement for filing in any
jurisdiction.
IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement
as of the day and year first above written.
LEAP WIRELESS INTERNATIONAL, INC.,
By
--------------------------------------
Name:
Title:
STATE STREET BANK AND TRUST COMPANY, as
Collateral Agent,
By
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Name:
Title:
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Schedule I to the
Pledge Agreement
CAPITAL STOCK
Number and
Number of Registered Class of Percentage
Issuer Certificates Owner Shares of Shares
------ ------------ ---------- ----------- ---------
LIMITED LIABILITY COMPANY MEMBERSHIP INTERESTS
Percentage
Number and of
Number of Registered Class of Membership
Issuer Certificates Owner Shares of Interests
------ ------------ ---------- ----------- -------------
PARTNERSHIP INTERESTS
Percentage of Limited
Number of Limited or General Partnership
Issuer Certificates General Interests
------ ------------ ---------- ---------------------
DEBT SECURITIES
Principal Date of Maturity
Issuer Amount Notes Date
------ -------- ------- --------
