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EXHIBIT 10.31
EXECUTION COPY
PLEDGE AGREEMENT
Dated as of January 22, 2001
between
LEAP WIRELESS INTERNATIONAL, INC.
as the Pledgor
and
CITIBANK, N.A.,
as the Collateral Agent
MILBANK, TWEED, HADLEY & MCCLOY LLP
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TABLE OF CONTENTS
Page
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ARTICLE 1 DEFINITIONS.......................................................................................1
Section 1.01 Certain Defined Terms.................................................................1
Section 1.02 Interpretation........................................................................2
ARTICLE 2 COLLATERAL........................................................................................2
Section 2.01 Grant.................................................................................2
Section 2.02 Perfection............................................................................3
Section 2.03 Preservation and Protection of Security Interests.....................................4
Section 2.04 Attorney-in-Fact......................................................................4
Section 2.05 Special Provisions Relating to the Stock Collateral...................................5
Section 2.06 Rights and Secured Obligations........................................................5
Section 2.07 Termination...........................................................................6
ARTICLE 3 REPRESENTATIONS AND WARRANTIES....................................................................6
Section 3.01 Representations and Warranties in the Loan Agreement..................................6
Section 3.02 Title.................................................................................6
Section 3.03 Corporate Power and Authority to Pledge...............................................6
Section 3.04 Pledged Stock.........................................................................6
Section 3.05 Licenses..............................................................................7
Section 3.06 Miscellaneous.........................................................................7
ARTICLE 4 COVENANTS.........................................................................................8
Section 4.01 Covenants of Pledgor under the Loan Agreement.........................................8
Section 4.02 Stock Collateral......................................................................8
Section 4.03 New License Subsidiaries; Changes to Annex 1..........................................8
Section 4.04 Liens.................................................................................9
Section 4.05 Ownership Interest; Additional Shares.................................................9
Section 4.06 Licenses and License Subsidiaries.....................................................9
Section 4.07 Notices...............................................................................9
Section 4.08 Further Assurances....................................................................9
ARTICLE 5 REMEDIES..........................................................................................9
Section 5.01 Events of Default, Etc................................................................9
Section 5.02 Deficiency............................................................................10
Section 5.03 Private Sale..........................................................................11
Section 5.04 Application of Proceeds...............................................................11
ARTICLE 6 CERTAIN WAIVERS...................................................................................12
Section 6.01 Absolute Liens; Certain Waivers and Consents..........................................12
Section 6.02 Understanding With Respect to Waivers and Consents....................................13
Section 6.03 Subrogation...........................................................................14
Section 6.04 Reinstatement.........................................................................14
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Section 6.05 Remedies..............................................................................14
Section 6.06 Separate Action.......................................................................14
Section 6.07 Subordination of Indebtedness of License Subsidiaries.................................15
Section 6.08 Certain Limitations...................................................................15
Section 6.09 Revocation............................................................................15
ARTICLE 7 MISCELLANEOUS.....................................................................................15
Section 7.01 Collateral Agent; Certain Transfers...................................................15
Section 7.02 Notices...............................................................................16
Section 7.03 Expenses, Etc.........................................................................16
Section 7.04 Waiver................................................................................16
Section 7.05 Amendments, Etc.......................................................................17
Section 7.06 Continuing Security Interest; Assignments Under the Loan Agreement; Successors and
Assigns...............................................................................17
Section 7.07 Survival..............................................................................17
Section 7.08 Agreements Superseded.................................................................17
Section 7.09 Severability..........................................................................18
Section 7.10 Captions..............................................................................18
Section 7.11 Counterparts..........................................................................18
Section 7.12 Governing Law; Submission to Jurisdiction.............................................18
Section 7.13 WAIVER OF JURY TRIAL..................................................................19
Section 7.14 FCC CONSENT...........................................................................19
ANNEX 1 PLEDGED STOCK IN LICENSE SUBSIDIARIES
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PLEDGE AGREEMENT
This PLEDGE AGREEMENT (this "Agreement"), dated as of January 22, 2001, is made
between LEAP WIRELESS INTERNATIONAL, INC., a Delaware corporation (the
"Pledgor") and holder of one hundred percent (100%) of the Capital Stock, as
defined below, of each License Subsidiary, as defined below, set forth in Annex
1, and CITIBANK, N.A., as the Collateral Agent (in such capacity, the
"Collateral Agent") for the Secured Parties, as defined below.
A. Pursuant to the Loan Agreement, dated as of the date hereof
(as amended, supplemented or modified from time to time, the "Loan Agreement"),
among the Pledgor, as Borrower, QUALCOMM INCORPORATED, as Lender ("QUALCOMM"),
other lenders specified in the Loan Agreement (each, including QUALCOMM, a
"Lender", and , collectively with QUALCOMM, the "Lenders"), Citibank, N.A., as
administrative agent for the Lenders (in such capacity, the "Administrative
Agent") and the Collateral Agent, the Lenders have agreed to make certain loans
(the "Loans") to the Pledgor.
B. It is a requirement under the Loan Agreement and a condition
precedent to the making of the Loans that the Pledgor shall have executed and
delivered this Agreement.
To induce the Lenders to enter into, and to extend credit under,
the Loan Agreement and for other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the Pledgor agrees to pledge
and grant a first-priority Lien on the Collateral as security for the Secured
Obligations. Accordingly, the Pledgor agrees with the Collateral Agent as
follows:
ARTICLE 1
DEFINITIONS
Section 1.01 Certain Defined Terms. Unless otherwise defined, all
capitalized terms used in this Agreement that are defined in the Loan Agreement
(including those terms incorporated by reference) shall have the respective
meanings assigned to them in the Loan Agreement. In addition, the following
terms shall have the following meanings under this Agreement:
"Collateral" shall have the meaning set forth in Section 2.01(a).
"FCC Laws" shall mean the U.S. Communications Act of 1934, and
any similar or successor federal statute, and the published rules, regulations
and orders of the FCC, all as the same may be in effect from time to time.
"Pledged Stock" shall have the meaning set forth in Section
2.01(a)(i).
"Secured Obligations" shall mean Borrower Obligations.
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"Stock Collateral" shall have the meaning set forth in Section
2.01(a)(iii).
"Termination Date" shall have the meaning set forth in Section
2.07.
"Uniform Commercial Code" shall mean the Uniform Commercial Code
as in effect in the State of New York from time to time.
Section 1.02 Interpretation. The provisions of Sections 1.2 and
1.3 of the Loan Agreement are incorporated herein by reference and made a part
hereof and shall apply to this Agreement mutatis mutandis as if set forth in
full in this Agreement.
ARTICLE 2
COLLATERAL
Section 2.01 Grant.
(a) As collateral security for the prompt payment in full when
due (whether at stated maturity, upon acceleration, on any optional or mandatory
prepayment date or otherwise) and performance of the Secured Obligations, the
Pledgor hereby pledges and grants to the Collateral Agent, for the ratable
benefit of the Secured Parties, a security interest in all of the Pledgor's
right, title and interest in, to and under the following property, whether now
owned or in the future acquired by the Pledgor and whether now existing or
hereafter coming into existence (collectively, the "Collateral"):
(i) (A) all of the issued and outstanding shares of
Capital Stock in each License Subsidiary set forth in Annex 1
represented by the respective certificates identified in Annex 1 and all
of the issued and outstanding other shares, securities, membership or
partnership interests in each such License Subsidiary of whatever type,
now owned or in the future acquired by the Pledgor, and (B) all of the
issued and outstanding shares of Capital Stock in each Wholly-Owned
Subsidiary of the Pledgor that becomes a License Subsidiary, together
with, in each case, the certificates representing the same and all of
the issued and outstanding other shares, securities, membership or
partnership interests in any such License Subsidiary, whether the stock
or other interest of such Subsidiary is now owned by the Pledgor or is
acquired by the Pledgor in the future (collectively, the "Pledged
Stock");
(ii) all shares, securities, membership or partnership
interests, moneys or other property representing a dividend on, or a
distribution or return of capital in respect of any of the Pledged
Stock, resulting from a split-up, revision, reclassification or other
like change of any of the Pledged Stock or otherwise received or to be
received in exchange for any of the Pledged Stock and all rights issued
to the holders of, or otherwise in respect of, any of the Pledged Stock;
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(iii) without affecting the obligations of the Pledgor as
Borrower under any provision of the Loan Agreement or any other Loan
Document prohibiting such action, in the event of any consolidation or
merger in which any License Subsidiary is not the surviving entity, all
shares, securities or membership or partnership interests, of the
successor entity formed by or resulting from that consolidation or
merger (collectively, and together with the property described in
clauses (i) and (ii) of this Section 2.01(a) above, the "Stock
Collateral");
(iv) To the extent related to all or any part of the
Collateral, all books, correspondence, credit files, records, invoices,
tapes, cards, computer files and other papers and documents in the
possession or under the control of the Pledgor or any computer bureau or
service company from time to time acting for the Pledgor; and
(v) All proceeds and products in whatever form of all or
any part of the Collateral.
Section 2.02 Perfection.
(a) Concurrently with the execution and delivery of this
Agreement, the Pledgor shall (i) deliver to the Collateral Agent the original of
each certificate identified in Annex 1, accompanied by undated stock powers,
endorsements or other similar documents representing the Pledged Stock at such
time, duly executed in blank, (ii) file such financing statements and other
documents in such offices as is necessary and as the Collateral Agent (acting at
the request or with the consent of the Required Lenders) may request, and (iii)
take all such other actions as is necessary or as the Collateral Agent (acting
at the request or with the consent of the Required Lenders) may request to
create, perfect and establish the first priority of the Liens granted by this
Agreement.
(b) With respect to any Collateral in which the Pledgor has any
right, title or interest and that constitutes an uncertificated security, the
Pledgor shall cause any issuer thereof either (i) to register the Collateral
Agent as the registered owner of such security or (ii) to agree in writing with
the Pledgor and the Collateral Agent that such issuer shall comply with
instructions of the Collateral Agent with respect to such security without
further consent of the Pledgor, such agreement to be in form, scope and
substance satisfactory to the Collateral Agent.
(c) The Collateral Agent shall have the right at any time to
exchange certificates or instruments representing or evidencing Collateral for
certificates or instruments of smaller or larger denominations.
(d) The Pledgor hereby authorizes the Collateral Agent or any
other Secured Party to file one or more financing or continuation statements,
and amendments thereto, relating to all or any part of the Collateral pledged by
the Pledgor hereunder without the signature of the Pledgor where permitted by
law. A photocopy or other reproduction of this Agreement or any financing
statement covering the Collateral or any part thereof shall be sufficient as a
financing statement where permitted by law.
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Section 2.03 Preservation and Protection of Security Interests.
The Pledgor shall:
(a) upon the acquisition after the date hereof by the Pledgor of
any Stock Collateral, promptly either (i) transfer and deliver to the Collateral
Agent all such Stock Collateral (together with the certificates representing
such Stock Collateral duly endorsed in blank or accompanied by undated stock
powers, endorsements or similar document duly executed in blank) or (ii) take
such other action as the Collateral Agent (acting at the request or with the
consent of the Required Lenders) reasonably deems necessary or appropriate to
create, perfect and establish the first priority of, the Liens granted by this
Agreement in such Stock Collateral;
(b) give, execute, deliver, file or record any and all financing
statements, notices, contracts, agreements or other instruments, obtain any and
all Governmental Approvals and take any and all steps that may be necessary or
as the Collateral Agent may reasonably request to create, perfect, establish the
first priority of, or to preserve the validity, perfection or the first priority
of, the Liens granted by this Agreement or to enable the Collateral Agent to
exercise and enforce its rights, remedies, powers and privileges under this
Agreement with respect to those Liens, including causing any or all of the Stock
Collateral to be transferred of record into the name of the Collateral Agent or
its nominee; and
(c) furnish to the Collateral Agent from time to time statements
and schedules further identifying and describing the Collateral pledged by the
Pledgor hereunder and such other reports in connection with the Collateral
pledged by the Pledgor hereunder as the Collateral Agent may reasonably request,
all in reasonable detail.
Section 2.04 Attorney-in-Fact. Subject to the rights of the
Pledgor under Section 2.05, the Pledgor hereby appoints the Collateral Agent its
attorney-in-fact for the purposes of carrying out the provisions of this
Agreement and taking any action and executing any instruments that the
Collateral Agent (acting at the request or with the consent of the Required
Lenders) may deem necessary or advisable to accomplish the purposes of this
Agreement, to preserve the validity, perfection and first priority of the Liens
granted by this Agreement and, following any Default, to exercise its rights,
remedies, powers and privileges under this Agreement. This appointment as
attorney-in-fact is irrevocable and coupled with an interest. Without limiting
the generality of the foregoing, the Collateral Agent shall be entitled under
this Agreement upon the occurrence and continuation of any Event of Default,
with full powers of substitution either in the name of the Collateral Agent or
the Pledgor, (a) to ask, demand, collect, sue for, recover, compromise, receive
and give receipt and discharge for amounts due and to become due under and in
respect of the Collateral or any part thereof; (b) to receive, endorse and
collect any drafts, checks, instruments, documents and chattel paper in
connection with clause (a) above; (c) to file any claims or take any action or
institute any proceeding that the Collateral Agent (acting at the request or
with the consent of the Required Lenders) may deem necessary or advisable for
the collection of all or any part of the Collateral or otherwise to enforce
compliance with the rights of the Collateral Agent with respect to any of the
Collateral or any part thereof; (d) to execute, in connection with any sale or
disposition of the
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Collateral under Article 5, any endorsements, assignments, bills of sale or
other instruments of conveyance or transfer with respect to all or any part of
the Collateral, and (e) to settle, compromise, prosecute or defend any action,
claim or proceeding with respect to the Collateral.
Section 2.05 Special Provisions Relating to the Stock Collateral.
(a) So long as no Default has occurred and is continuing, the
Pledgor shall have the right to exercise all voting, consensual and other powers
of ownership pertaining to the Stock Collateral for all purposes and in a manner
not inconsistent with the terms of any Loan Document, provided that the Pledgor
shall not be entitled to exercise any such right if the result thereof could
materially and adversely affect the rights and remedies of any of the Secured
Parties under this Agreement or any other Loan Document or the ability of the
Secured Parties to exercise the same or the value of the Collateral or any part
thereof.
(b) So long as no Default has occurred and is continuing, but
subject to the terms of the Loan Agreement (including Sections 2.11 and 7.1
thereof), the Pledgor shall be entitled to receive and retain any dividends or
distributions on the Stock Collateral paid in cash out of earned surplus (and
not, for the avoidance of doubt, paid in connection with a partial or total
liquidation or dissolution or in connection with a reduction of capital, capital
surplus or paid-in surplus or otherwise distributed in redemption of, or in
exchange for, any Collateral), to the extent and only to the extent allowed by
the Loan Agreement, other Loan Documents and Applicable Laws.
(c) If any Default shall have occurred and be continuing, and
whether or not the Collateral Agent or any other Secured Party exercises any
available right to declare any Secured Obligation due and payable or seeks or
pursues any other right, remedy, power or privilege available to it under
Applicable Law, this Agreement or any other Loan Document, all dividends and
other distributions on the Stock Collateral (whether paid or payable in cash or
otherwise, whether resulting from a merger, consolidation, acquisition, partial
or total liquidation, dissolution of the relevant License Subsidiary or
subdivision, combination or a reclassification of the Capital Stock of any
License Subsidiary) shall be paid directly to the Collateral Agent to account
number 103828 or any other account designated and maintained from time to time
by the Collateral Agent, subject to the terms of this Agreement, and, if the
Collateral Agent shall so request, the Pledgor agrees to execute and deliver to
the Collateral Agent appropriate additional dividend, distribution and other
orders and instruments to that end. Upon the occurrence of a Default, all rights
of the Pledgor to dividends or other distributions on the Stock Collateral
pursuant to Section 2.05(b) shall cease, and all such rights shall become vested
in the Collateral Agent, which shall have the sole and exclusive right and
authority to receive such dividends and distributions. All dividends and other
distributions received by the Pledgor in violation of this Section 2.05(c) shall
be held in trust for the benefit of the Collateral Agent, shall be segregated
from the other property or funds of the Pledgor and shall forthwith be paid over
to the Collateral Agent as Collateral in the same form as so received (with any
necessary endorsements).
Section 2.06 Rights and Secured Obligations.
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(a) No reference in this Agreement to proceeds or to the sale or
other disposition of Collateral shall authorize the Pledgor to sell or otherwise
dispose of any part of the Collateral, except in accordance with the provisions
of the Loan Agreement.
(b) Neither the Collateral Agent nor any other Secured Party
shall be required to take steps necessary to preserve any rights against prior
parties to any part of the Collateral.
Section 2.07 Termination. This Agreement shall (so long as no
Commitments remain outstanding) terminate upon the full and final payment of any
and all Secured Obligations (the "Termination Date"), and, promptly after the
Termination Date, the Collateral Agent (acting at the direction of the Required
Lenders) will cause to be assigned, transferred and delivered, against receipt
but without any recourse, warranty or representation whatsoever, any remaining
Collateral and money received in respect of the Collateral, to or on the order
of the Pledgor.
ARTICLE 3
REPRESENTATIONS AND WARRANTIES
As of the date hereof, as of the date of each Borrowing and
(solely with respect to any new License Subsidiaries being added to Annex 1, but
excluding the representations and warranties in Section 3.01), as of the date of
any change to Annex 1 contemplated by Section 4.03, the Pledgor represents and
warrants to the Collateral Agent, QUALCOMM and each other Secured Party as
follows:
Section 3.01 Representations and Warranties in the Loan
Agreement. The Pledgor confirms the representations and warranties contained in
Article 6 of the Loan Agreement, as if made as of each date provided for in the
Loan Agreement, which are incorporated herein by reference as if fully set forth
in this Agreement for the benefit of the Collateral Agent, QUALCOMM and each
other Secured Party.
Section 3.02 Title. The Pledgor is the sole legal and beneficial
owner of the Collateral, and the Collateral is free and clear of all Liens,
except for the Liens created pursuant to this Agreement or, to the extent any
such Lien is permitted under Section 7.6(d) of the Loan Agreement, the
subordinated Liens of the lenders under the Vendor Credit Agreements.
Section 3.03 Corporate Power and Authority to Pledge. The Pledgor
has full corporate power and authority to create and perfect valid
first-priority Liens on the Collateral in the manner and on the terms provided
in this Agreement and the Pledgor has taken all necessary corporate and, if
required, stockholder action to duly authorize the creation and perfection of
such Liens.
Section 3.04 Pledged Stock.
(a) The Pledged Stock evidenced by the certificates identified in
Annex 1 is duly authorized, validly existing, fully paid and non-assessable, and
none of such Pledged Stock
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is subject to any contractual restriction, or any restriction under the Charter
Documents of the relevant License Subsidiary or the Pledgor on the transfer of
such Pledged Stock (except for any such restriction contained in the Loan
Agreement or any other Loan Document).
(b) The Pledged Stock evidenced by the certificates identified in
Annex 1 constitutes all of the issued and outstanding shares of the Capital
Stock of each License Subsidiary listed on Annex 1 legally and beneficially
owned by the Pledgor on the date hereof and as of the date of any change to
Annex 1 contemplated by Section 4.03 (whether or not registered in the name of
the Pledgor). The Pledgor owns 100% of the Pledged Stock in each License
Subsidiary listed on Annex 1.
(c) Annex 1 correctly identifies, as at the date hereof, the
respective type, percentage interest, and number of the shares of the Pledged
Stock evidenced by each such certificate. All information with respect to the
Pledged Stock as listed on Annex 1 is accurate and complete in all material
respects as of the date of this Agreement and as of the date of any change to
Annex 1 contemplated by Section 4.03.
Section 3.05 Licenses. Each License described in Annex 1 as
maintained by the relevant License Subsidiary has been duly obtained, is validly
issued, is in full force and effect, is held in the name of such License
Subsidiary and is free from any condition or requirement under Applicable Law
compliance with which could reasonably be expected to result in a Material
Adverse Effect or which Borrower does not reasonably expect to be able to
satisfy in a timely manner. No Governmental Approval is required to be obtained
or accomplished for the continued validity of each such License.
Section 3.06 Miscellaneous.
(b) The Chief Executive Office of the Pledgor is located at the
address specified in Annex 1, as such Annex 1 may be amended from time to time.
The Pledgor's federal tax identification number is set forth in Annex 1. All
Collateral consisting of certificated securities and instruments has been
delivered to the Collateral Agent. All actions required by Section 2.02(b) with
respect to uncertificated securities included in the Collateral have been taken
by the Pledgor.
(c) No effective financing statement or other instrument similar
in effect covering all or any part of the Collateral is on file in any recording
office, except such as may have been filed in favor of the Collateral Agent
relating to this Agreement or the other Loan Documents or, to the extent any
such Lien is permitted under Section 7.06(d) of the Loan Agreement, such as may
have been filed or may be filed in respect of the subordinated Liens of the
lenders under the Vendor Credit Agreements.
(d) This Agreement and the pledge of the Collateral by the
Pledgor pursuant hereto create in favor of the Collateral Agent for the benefit
of the Secured Parties a valid and perfected first priority Lien on the
Collateral of the Pledgor, securing the payment of the Secured Obligations, and
all filings and other actions necessary or desirable to perfect and protect such
Lien have been duly taken.
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(e) No consent of any other Person and no Governmental Approval
by, and no notice to or filing with, any Governmental Authority or regulatory
body, or any other Person is required for (i) the grant by the Pledgor of the
Liens granted hereby, for the pledge by the Pledgor of the Collateral pursuant
hereto or for the execution, delivery and performance of this Agreement by the
Pledgor, (ii) the perfection or maintenance of the Liens created hereby
(including the first priority nature of such Liens), except for action described
in Section 2.02, which actions have been taken and are in full force and effect,
or (iii) the exercise by the Collateral Agent of its voting or other rights
provided for in this Agreement or the remedies in respect of the Collateral
pursuant to this Agreement, except for notices by the Collateral Agent to the
lenders under the Vendor Credit Agreements who have subordinated Liens in the
Collateral, and except as may be required in connection with the disposition or
any portion of the Collateral by laws affecting the offering and sale of
securities generally.
ARTICLE 4
COVENANTS
The Pledgor covenants and agrees that so long as any Secured
Obligations remain unpaid or unsatisfied, that:
Section 4.01 Covenants of Pledgor under the Loan Agreement. The
Pledgor shall observe and perform each of the covenants and agreements contained
in Article 7 of the Loan Agreement, and such covenants and agreements are
incorporated by reference into this Agreement, mutatis mutandis, for the benefit
of the Collateral Agent and each Secured Party.
Section 4.02 Stock Collateral. The Pledgor shall cause the Stock
Collateral to constitute at all times 100% of the total number of shares in each
class of Capital Stock of each License Subsidiary then outstanding. The Pledgor
shall cause all such shares of Capital Stock to be duly authorized, validly
existing, fully paid and non-assessable, and to be free of any contractual
restriction or any restriction under the Charter Documents of such License
Subsidiary or the Pledgor on the transfer of such Pledged Stock (except for any
such restriction contained in the Loan Agreement or any other Loan Document).
Section 4.03 New License Subsidiaries; Changes to Annex 1.
(a) Promptly, but no later than five (5) Business Days after the
date when a Subsidiary of the Pledgor becomes a License Subsidiary, the Pledgor
shall take all actions required under Section 2.01, Section 2.02 and Section
2.03 or as otherwise requested by the Collateral Agent in order to create a
valid and perfected first-priority Lien on the Capital Stock of such Subsidiary
in favor of the Collateral Agent acting for the benefit of the Secured Parties.
(b) Promptly, but no later than five (5) Business Days after the
date when a Subsidiary of the Pledgor becomes a License Subsidiary, the Pledgor
shall provide the Collateral Agent with an updated Annex 1 describing the
Pledged Stock, including (without limitation) the Capital Stock of such
Subsidiary and describing the License held in the name of such Subsidiary
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and shall request approval of such updated schedule from the Required Lenders.
Upon approval by the Required Lenders, such updated Annex 1 shall be deemed to
have replaced the original Annex 1.
Section 4.04 Liens. The Pledgor shall not, and shall not permit
any License Subsidiary to, create, incur, assume or suffer to exist any Lien on
the Capital Stock or assets of any License Subsidiary except for the Liens
created pursuant to this Agreement or, to the extent permitted under Section
7.6(d) of the Loan Agreement, for subordinated Liens in favor of the lenders
under the Vendor Credit Agreements.
Section 4.05 Ownership Interest; Additional Shares. The Pledgor
shall defend its title to the Stock Collateral and shall not sell, assign,
lease, transfer or otherwise dispose of all or any portion of the Collateral
(including by operation of law) except as permitted under this Agreement. The
Pledgor shall (i) cause each License Subsidiary listed on Annex 1, as amended
from time to time, not to issue any Capital Stock in addition to or in
substitution for the Pledged Stock issued by such License Subsidiary as listed
on Annex 1, except to the Pledgor, and (ii) the Pledgor, immediately upon
acquisition thereof, shall take all actions required under Section 2.01, Section
2.02 and Section 2.03 or as otherwise requested by the Collateral Agent in order
to create in favor of the Secured Parties a valid and perfected first-priority
Lien on such Capital Stock of such License Subsidiary.
Section 4.06 Licenses and License Subsidiaries. The Pledgor
agrees that it shall cause each License Subsidiary (a) to be a direct
Wholly-Owned Subsidiary of the Pledgor, (b) not to engage in any business or
activity other than the ownership of one or more Licenses and activities
incidental thereto, (c) not to own or acquire any assets other than one or more
Licenses, cash and other assets permitted under the Loan Agreement or the Vendor
Facilities, and (d) not to have or incur any Indebtedness or other liabilities.
Section 4.07 Notices. The Pledgor shall promptly give to the
Collateral Agent copies of any material notices or other communications received
by it with respect to the Stock Collateral.
Section 4.08 Further Assurances. The Pledgor shall, from time to
time upon the written request of the Collateral Agent, execute and deliver such
further documents and do such other acts and things as the Collateral Agent may
reasonably request in order fully to effect the purposes of this Agreement.
ARTICLE 5
REMEDIES
Section 5.01 Events of Default, Etc. If any Event of Default has
occurred and is continuing:
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(a) the Collateral Agent in its discretion (acting at the request
or with the consent of the Required Lenders) may, in its name or in the name of
the Pledgor or otherwise, demand, sue for, collect or receive any money or
property at any time payable or receivable on account of or in exchange for all
or any part of the Collateral, but shall be under no obligation to do so;
(b) the Collateral Agent in its discretion (acting at the request
or with the consent of the Required Lenders) may, upon ten (10) Business Days'
prior written notice to the Pledgor (which the Pledgor agrees is reasonable
notice within the meaning of the relevant provisions of the Uniform Commercial
Code and other Applicable Law) of the time and place, sell, lease or otherwise
dispose of all or any part of the Collateral that then is or subsequently comes
into the possession, custody or control of the Collateral Agent, the
Administrative Agent, any other Secured Party or any of their respective agents,
at such place or places as the Collateral Agent (acting at the request or with
the consent of the Required Lenders) deems best, for cash, for credit or for
future delivery (without thereby assuming any credit risk) and at public or
private sale, without demand of performance or notice of intention to effect any
such disposition or of the time or place of any such sale (except such notice as
is required above or by applicable statute and cannot be waived), and any Lender
or any other Person may be the purchaser, lessee or recipient of all or any part
of the Collateral so disposed of at any public sale (or, to the extent permitted
by law, at any private sale) and thereafter hold the same absolutely, free from
any claim or right of whatsoever kind, including any right or equity of
redemption (statutory or otherwise), of the Pledgor, and the Pledgor hereby
waives and releases any such demand, notice and right or equity. 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 the sale, and that sale may be made at any time or place to
which the sale may be so adjourned; and
(c) the Collateral Agent shall have, and in its discretion
(acting at the request or with the consent of the Required Lenders) may
exercise, all of the rights, remedies, powers and privileges with respect to the
Collateral of a secured party under the Uniform Commercial Code (whether or not
the Uniform Commercial Code is in effect in the jurisdiction where any such
rights, remedies, powers and privileges are asserted) and such additional
rights, remedies, powers and privileges to which a secured party is entitled
under the laws in effect in any jurisdiction where any rights, remedies, powers
and privileges in respect of this Agreement or the Collateral may be asserted,
including the right, to the maximum extent permitted by law, to exercise all
voting, consensual and other powers of ownership pertaining to the Collateral as
if the Collateral Agent were the sole and absolute owner of the Collateral (and
the Pledgor will take all such action as may be appropriate to give effect to
that right).
The proceeds of, and other realization upon, the Collateral by virtue of the
exercise of remedies under this Section 5.01 shall be applied in accordance with
Section 5.04.
Section 5.02 Deficiency. If the proceeds of, or other realization
upon, the Collateral by virtue of the exercise of remedies under Section 5.01
are insufficient to cover the
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costs and expenses of that exercise and the payment in full of the other Secured
Obligations under this Agreement, the Pledgor shall remain liable for any
deficiency.
Section 5.03 Private Sale.
(a) Neither the Collateral Agent nor any Secured Party shall
incur any liability as a result of the sale, lease or other disposition of all
or any part of the Collateral at any private sale pursuant to Section 5.01
conducted in a commercially reasonable manner. The Pledgor hereby waives any
claims against the Collateral Agent or any Secured Party that may arise by
reason of the fact that the price at which the Collateral may have been sold at
such a private sale was less than the price that might have been obtained at a
public sale or was less than the aggregate amount of the Secured Obligations,
even if the Collateral Agent accepts the first offer received and does not offer
the Collateral to more than one offeree.
(b) The Pledgor recognizes that, by reason of certain
prohibitions contained in the Securities Act of 1933 and applicable state
securities laws, the Collateral Agent may be required to limit purchasers of all
or any part of the Collateral to those who will agree, among other things, to
acquire the Collateral for their own account, for investment and not with a view
to distribution or resale. The Pledgor acknowledges that any such private sales
may be at prices and on terms less favorable to the Collateral Agent than those
obtainable through a public sale without those restrictions, and,
notwithstanding those circumstances, agrees that any such private sale shall be
deemed to have been made in a commercially reasonable manner and that the
Collateral Agent shall have no obligation to engage in public sales and no
obligation to delay the sale of any Collateral for the period of time necessary
to permit the Pledgor to register it for public sale.
Section 5.04 Application of Proceeds. Except as otherwise
expressly provided in this Agreement, the proceeds of, or other realization
upon, all or any part of the Collateral by virtue of the exercise of remedies
under Section 5.01 and any other cash at the time held by the Collateral Agent
under Section 5.01 shall be applied by the Collateral Agent:
First, to the payment of the costs and expenses of that exercise
of remedies, including reasonable out-of-pocket costs and expenses of the
Collateral Agent, the reasonable fees and expenses of its agents and counsel and
all other expenses incurred and advances made by the Collateral Agent in that
connection;
Next, to the payment in full of the remaining Secured Obligations
equally and ratably in accordance with their respective amounts then due and
owing or as the Secured Parties holding the same may otherwise agree; and
Finally, subject to the rights of the other holder of any
subordinated Lien in the relevant Collateral, if any, to the payment to the
Pledgor or as a court of competent jurisdiction may direct, of any surplus then
remaining.
As used in this Article 5, "proceeds" of Collateral shall mean
cash, securities and other property realized in respect of, and distributions in
kind of, Collateral, including any
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property received under any bankruptcy, reorganization or other similar
proceeding as to the Pledgor or any issuer of, or account debtor other than the
Pledgor on, any of the Collateral.
ARTICLE 6
CERTAIN WAIVERS
Section 6.01 Absolute Liens; Certain Waivers and Consents.
(a) The Pledgor acknowledges hereby that the grant of the Liens
on the Collateral under this Agreement and its obligations under this Agreement
shall be absolute, irrevocable and unconditional under any and all circumstances
irrespective of, and the Pledgor hereby irrevocably waives any defense it may
now have or may hereafter acquire in any way relative to, any or all of the
following:
(vi) any amendment, modification, extension, renewal,
waiver, acceleration or any other change of the time for payment or
performance of, or the terms of, all or any part of the Secured
Obligations (including any increase or decrease in the rate or rates of
interest on all or any part of the Secured Obligations);
(vii) any amendment, modification, extension,
renewal, waiver of, or any other change of the time for payment or
performance under, any Loan Document or any agreement, security
document, guarantee, approval, consent or other instrument with respect
to all or any part of the Secured Obligations or any such other
instrument or any term or provision of the foregoing;
(viii) any execution, delivery or performance of new
or additional agreements, security documents, guarantees (including
letters of credit) or other instruments in addition to, in exchange for
or relative to any Loan Document, all or any part of the Secured
Obligations or any collateral now or in the future serving as security
for the Secured Obligations;
(ix) any acceptance or receipt of partial payments or
performance on the Secured Obligations (including from the Pledgor),
whether as a result of the exercise of any right, remedy, power or
privilege or otherwise;
(x) any acceptance or receipt of any additional
collateral for all or any part of the Secured Obligations (including
from the Pledgor);
(xi) any illegality, invalidity or unenforceability
of all or any part of the Secured Obligations, any Loan Document or any
agreement, security document, guarantee or other instrument with
respect to all or any part of the Secured Obligations;
(xii) any exchange, release, reconveyance,
termination, waiver, abandonment, failure to perfect, substitution,
transfer, enforcement of, or foreclosure
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upon, any collateral, security documents or guarantees (including the
obligations of the Pledgor) for or with respect to all or any part of
the Secured Obligations;
(xiii) any other condition, event or circumstance
that might otherwise constitute a defense available to, or a discharge
of, the Pledgor in respect of its obligations under this Agreement
(other than the indefeasible payment in full of all Secured
Obligations);
(xiv) any counterclaim, set-off or other claim which
the Pledgor has or alleges to have with respect to all or any part of
the Secured Obligations;
(xv) any failure of any Secured Party to comply with
Applicable Laws in connection with the sale or other disposition of the
Collateral for all or any part of the Secured Obligations;
(xvi) any change, restructuring or termination of the
corporate structure or existence of the Pledgor or any of its
Affiliates or Subsidiaries;
(xvii) any other circumstance (including, without
limitation, any statute of limitations) or any existence of or reliance
on any representation by any Secured Party that might otherwise
constitute a defense available to, or a discharge of, the Pledgor or
any other grantor or a third party grantor of a security interest;
(xviii) any other circumstance that might otherwise
constitute a defense available to, or a discharge of, the Pledgor or a
third party grantor of a security interest; or
(xix) any combination of the actions set forth in
this Section 6.01(a).
(b) The Pledgor expressly waives, for the benefit of the
Secured Parties, all presentments, demands for payment or performance, notices
of nonpayment or nonperformance, protests, notices of protest, notices of
dishonor and all other notices or demands of any kind or nature whatsoever with
respect to the Secured Obligations, and all notices of acceptance of this
Agreement or of the existence, creation, incurring or assumption of new or
additional Secured Obligations. The Pledgor further expressly waives the benefit
of any and all statutes of limitation and any and all laws providing for the
exemption of property from execution or for valuation and appraisal upon
foreclosure, to the maximum extent permitted by applicable law.
Section 6.02 Understanding With Respect to Waivers and
Consents. The Pledgor warrants and agrees that each of the waivers and consents
set forth in this Agreement are made voluntarily and unconditionally after
consultation with outside legal counsel and with full knowledge of their
significance and consequences, with the understanding that events giving rise to
any defense or right waived may diminish, destroy or otherwise adversely affect
rights which the Pledgor otherwise may have against the Collateral Agent, any
other Secured Party or any other Person or against any collateral. If,
notwithstanding the intent of the parties that the terms of this Agreement shall
control in any and all circumstances, any such waivers or consents are
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determined to be unenforceable under applicable law, such waivers and consents
shall be effective to the maximum extent permitted by law.
Section 6.03 Subrogation. The Pledgor hereby waives, until the
indefeasible payment and satisfaction in full of all of the Secured Obligations,
any right, remedy, power or privilege, such as any right of subrogation,
contribution or indemnity or related remedy, power or privilege, arising
(whether by contract or operation of law, including under the Bankruptcy Code)
against any License Subsidiary or any other Person or any collateral by reason
of any payment or other performance pursuant to the provisions of this Agreement
and, if any amount is paid to the Pledgor on account of those rights, remedies,
powers or privileges, it will hold that amount in trust for the benefit of, and
pay the same over to, the Collateral Agent (for the benefit of the Secured
Parties) on account of the Secured Obligations. The Pledgor understands that the
exercise by any Secured Party of any right, remedy, power or privilege that it
may have under the Loan Documents, security agreement, guarantee, letter of
credit or other instrument for or relative to all or any part of the Secured
Obligations or otherwise may affect or eliminate the Pledgor's right of
subrogation or similar recovery against any License Subsidiary or any other
Person or against any collateral and that the Pledgor may therefore incur
partially or totally nonreimbursable liability under this Agreement.
Nevertheless, the Pledgor hereby authorizes and empowers the Secured Parties to
exercise, in its or their sole discretion, any combination of those rights,
remedies, powers and privileges.
Section 6.04 Reinstatement. The obligations of the Pledgor
under this Agreement shall be automatically reinstated if and to the extent that
for any reason any payment by or on behalf of the Pledgor or any other Person or
any other application of funds (including the proceeds of any collateral for all
or any part of the Secured Obligations) in respect of all or any part of the
Secured Obligations is rescinded or must be otherwise restored by any holder of
those Secured Obligations, whether as a result of any proceedings in bankruptcy,
reorganization or otherwise and the Pledgor agrees that it will indemnify each
Secured Party on demand for all reasonable costs and expenses (including
reasonable fees and expenses of counsel) incurred by that Secured Party in
connection with that rescission or restoration.
Section 6.05 Remedies. The Pledgor hereby agrees that the
Secured Obligations may be declared to be forthwith (or may become
automatically) due and payable as provided in Section 8.2 of the Loan Agreement
for purposes of this Agreement, notwithstanding any stay, injunction or other
prohibition preventing such declaration and that, in the event of that
declaration, those obligations shall forthwith become due and payable for
purposes of this Agreement.
Section 6.06 Separate Action. The Administrative Agent or the
Collateral Agent may bring and prosecute a separate action or actions against
the Pledgor, whether or not the Pledgor, any of its Subsidiaries or any other
Person is joined in any such action or a separate action or actions are brought
against the Pledgor, any of its Subsidiaries or any other Person or any
collateral for all or any part of the Secured Obligations. The obligations of
the Pledgor under, and the effectiveness of, this Agreement are not conditioned
upon the existence or
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continuation of any other guarantee or any letter of credit for or relative to
all or any part of the Secured Obligations.
Section 6.07 Subordination of Indebtedness of License
Subsidiaries. The Pledgor agrees that any Indebtedness now or in the future owed
to it by any License Subsidiary is hereby subordinated in right of payment to
the prior payment in full in cash of the Secured Obligations on the terms set
forth in the Loan Agreement. Without limiting the generality of the foregoing,
if the Collateral Agent so requests, any such Indebtedness shall be collected,
enforced and received by the Pledgor as trustee for the Collateral Agent and
shall be paid over to the Collateral Agent (for the benefit of the Secured
Parties) in kind on account of the Secured Obligations. If, after the Collateral
Agent's request, the Pledgor fails to collect or enforce any such indebtedness
or to pay the proceeds of that indebtedness to the Collateral Agent, the
Collateral Agent as the Pledgor's attorney-in-fact may do such acts and sign
such documents in the Pledgor's name and on the Pledgor's behalf as the
Collateral Agent considers necessary or desirable to effect that collection,
enforcement or payment, the Collateral Agent being hereby appointed the
Pledgor's attorney-in-fact for that purpose (and such appointment is irrevocable
and is coupled with an interest).
Section 6.08 Certain Limitations. In any action or proceeding
involving any state corporate law or any state or federal bankruptcy,
insolvency, reorganization or other law affecting the rights of creditors
generally, if the obligations of the Pledgor under this Agreement would
otherwise be held or determined to be void, invalid or unenforceable or if the
claims of the Secured Parties in respect of those obligations would be
subordinated to the claims of any other creditors on account of the Pledgor's
liability under this Agreement, then, notwithstanding any other provision of
this Agreement to the contrary, the amount of that liability shall, without any
further action by the Pledgor, any Secured Party or any other Person, be
automatically limited and reduced to the highest amount that is valid and
enforceable and not subordinated to the claims of other creditors as determined
in such action or proceeding.
Section 6.09 Revocation. To the fullest extent permitted by
law, the Pledgor hereby waives all rights it may have to revoke its obligations
under this Agreement.
ARTICLE 7
MISCELLANEOUS
Section 7.01 Collateral Agent; Certain Transfers. As provided
in Section 9.1 of the Loan Agreement, each Lender has appointed Citibank, N.A.
as its Collateral Agent for purposes of this Agreement. In that capacity,
Citibank, N.A. shall be entitled to all the rights and benefits accorded the
Collateral Agent (including the ability to rely on express directions of the
Required Lenders) by Article 9 of the Loan Agreement. Article 9 of the Loan
Agreement is incorporated herein by reference and made a part hereof and shall
apply to this Agreement mutatis mutandis as if set forth in this Agreement.
Following the payment in full of all Secured Obligations outstanding under the
Loan Agreement and the termination or expiration of the
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Commitments, the provisions of Article 9 of the Loan Agreement shall be deemed
to continue in full force and effect for the benefit of the Collateral Agent
under this Agreement.
Section 7.02 Notices. All notices, requests and other
communications provided for in this Agreement shall be given or made in writing
and delivered by hand or courier service, mailed by certified or registered mail
or sent by telecopy to the intended recipient as specified below or, as to any
party, at such other address as is designated by that party in a notice to each
other party. All notices and other communications given to any party hereto in
accordance with the provisions of this Agreement, when hand delivered or
telecopied shall be deemed to have been given when hand delivered or telecopied
respectively, and when sent by regular mail, postage prepaid, return receipt
requested or international air courier, shall be deemed to have been given five
(5) days after the date of deposit in the mails or with the international air
courier, respectively, provided that any such notice or communication to the
Collateral Agent shall be deemed to have been given only on the date of receipt.
To the Pledgor:
LEAP WIRELESS INTERNATIONAL, INC.
10307 Pacific Center Court.
San Diego, California 92121
Attn: General Counsel
Fax: (858) 882-6040
Phone: (858) 882-6000
To the Collateral Agent:
CITIBANK, N.A., as Collateral Agent
Citibank Agency & Trust
111 Wall Street, 14th Floor
New York, NY 10043
Attn: Donna White, Assistant Vice President
Fax: (212) 657-3872
Phone: (212) 657-5252
Section 7.03 Expenses, Etc. The Pledgor will pay all
out-of-pocket expenses (including reasonable counsels' fees and expenses) of the
Collateral Agent and each other Secured Party in connection with any enforcement
or collection proceeding (including any bankruptcy, reorganization,
restructuring, "work out" or other similar proceeding) as to any of the
obligations of the Pledgor under this Agreement, the negotiation of any
restructuring or "work out" (whether or not consummated) or the enforcement of
this Section 7.03. All amounts due under this Agreement not paid when due shall
bear interest until paid at a rate per annum equal to the Post-Default Rate.
Section 7.04 Waiver. No failure or delay by the Collateral
Agent or any other Secured Party in exercising any remedy, right, power or
privilege under this Agreement or any
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other Loan Document shall operate as a waiver of that remedy, right, power or
privilege, nor shall any single or partial exercise of that remedy, right, power
or privilege preclude any other or further exercise of that remedy, right, power
or privilege or the exercise of any other remedy, right, power or privilege. The
remedies, rights, powers and privileges provided by this Agreement are
cumulative and not exclusive of any remedies, rights, powers or privileges
provided by the other Loan Documents or by law.
Section 7.05 Amendments, Etc. No provision of this Agreement
may be waived, modified or supplemented except by an instrument in writing
signed by the Pledgor and the Collateral Agent (acting at the request or with
the consent of the Required Lenders). Any modification, supplement or waiver
shall be for such period and subject to such conditions as shall be specified in
the written instrument effecting the same and shall be binding upon each Secured
Party and the Pledgor, and any such waiver shall be effective only in the
specific instance and for the purpose for which given.
Section 7.06 Continuing Security Interest; Assignments Under
the Loan Agreement; Successors and Assigns.
(a) This Agreement shall (subject to Section 2.07) create a continuing
first-priority Lien in the Collateral and shall (a) be binding upon the Pledgor,
its successors and assigns, and (b) inure, together with the rights and remedies
of the Collateral Agent hereunder, to the benefit of the Secured Parties and
their respective successors, transferees and assigns. Without limiting the
generality of the foregoing clause (b), any Lender may assign or otherwise
transfer all or any portion of its Loans under the Loan Agreement to any
Eligible Assignee under Section 10.4(b) of the Loan Agreement, and such Eligible
Assignee shall thereupon become vested with all the benefits in respect thereof
granted to such Lender herein or under the other Loan Documents, in each case as
provided in Section 10.4(b) of the Loan Agreement.
(b) This Agreement shall be binding upon and inure to the benefit of the parties
hereto and their respective successors and assigns. The Pledgor may not assign
or transfer its rights or obligations under this Agreement without the prior
written consent of the Collateral Agent (acting at the request or with the
consent of the Required Lenders).
Section 7.07 Survival. Each representation and warranty made,
or deemed to be made by a notice of any extension of credit, in or pursuant to
this Agreement shall survive the making or deemed making of that representation
and warranty, and no Secured Party shall be deemed to have waived, by reason of
making any extension of credit, any Default that may arise by reason of that
representation or warranty proving to have been false or misleading,
notwithstanding that such or any other Secured Party may have had notice or
knowledge or reason to believe that such representation or warranty was false or
misleading at the time that extension of credit was made.
Section 7.08 Agreements Superseded. This Agreement (together
with the Loan Agreement) supersedes all prior agreements and understandings,
written or oral, among the parties with respect to the subject matter of this
Agreement.
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Section 7.09 Severability. Any provision of this Agreement
that is prohibited or unenforceable in any jurisdiction shall, as to that
jurisdiction, be ineffective to the extent of that prohibition or
unenforceability without invalidating the remaining provisions of this
Agreement, and any such prohibition or unenforceability in any jurisdiction
shall not invalidate or render unenforceable that provision in any other
jurisdiction.
Section 7.10 Captions. The table of contents, captions and
section headings appearing in this Agreement are included solely for convenience
of reference and are not intended to affect the interpretation of any provision
of this Agreement.
Section 7.11 Counterparts. This Agreement may be executed in
any number of counterparts, all of which taken together shall constitute one and
the same instrument, and any of the parties to this Agreement may execute this
Agreement by signing any such counterpart. Delivery of an executed counterpart
of a signature page to this Agreement by hand or by telecopy shall be effective
as the delivery of a fully executed counterpart of this Agreement.
Section 7.12 Governing Law; Submission to Jurisdiction.
(a) (a) This Agreement shall be construed in accordance with
and governed by the law of the State of New York.
(b) (b) Each party hereto 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 this Agreement, 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 heard and determined in such New York State court 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. Nothing in this Agreement shall affect any right that any party
hereto may otherwise have to bring any action or proceeding relating to this
Agreement against any other party or its properties in the courts of any
jurisdiction.
(c) (c) The Pledgor hereby irrevocably and unconditionally
waives, to the fullest extent it may legally and effectively do so, any
objection which 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 in any court
referred to in Section 7.12(b). 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.
(d) (d) The Pledgor hereby agrees that service of all writs,
process and summonses in any such suit, action or proceeding brought in the
State of New York may be made upon CSC Networks, presently located at 80 State
Street, Albany, NY 12207, U.S.A. (the "Process Agent"), and the Pledgor hereby
confirms and agrees that the Process Agent has been duly and irrevocably
appointed as its agent and true and lawful attorney-in-fact in its name, place
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and stead to accept such service of any and all such writs, process and
summonses, and agrees that the failure of the Process Agent to give any notice
of any such service of process to the Pledgor shall not impair or affect the
validity of such service or of any judgment based thereon. Each party to this
Agreement further irrevocably consents to service of process in the manner
provided for written notices in Section 7.02. 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 7.13 WAIVER OF JURY TRIAL. EACH OF THE PLEDGOR AND THE
COLLATERAL AGENT (ON BEHALF OF ITSELF AND EACH OTHER SECURED PARTY), WAIVES TO
THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL
BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR
RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER
BASED ON CONTRACT, TORT OR ANY OTHER THEORY). 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 7.13.
Section 7.14 FCC CONSENT. Notwithstanding anything in this
Agreement which may be construed to the contrary (including Section 2.04), no
action shall be taken by the Collateral Agent or the Secured Parties with
respect to the foreclosure on, sale, transfer or disposition of, or control of,
the Collateral, except in compliance with the FCC Laws.
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IN WITNESS WHEREOF, the parties have caused this Agreement to
be duly executed and delivered as of the day and year first above written.
LEAP WIRELESS INTERNATIONAL, INC.
By: /s/ THOMAS WILLARDSON
------------------------------------
Printed Name: Thomas Willardson
--------------------------
Title: Senior Vice President & Treasurer
---------------------------------
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CITIBANK, N.A., as the Collateral Agent
By: /s/ JOHN J. BYRNES
-----------------------------------
Printed Name: John J. Byrnes
-------------------------
Title: Vice President
--------------------------------
25
ANNEX 1
PLEDGED STOCK IN LICENSE SUBSIDIARIES
1. [Legal Name of the Pledgor]
2. [Address of the Pledgor's chief executive office]
3. [The Pledgor's Federal Tax Identification Number]
CAPITAL STOCK
1. [Legal Name of License Subsidiary]
2. [Legal form and jurisdiction of incorporation]
3. [Description of the License held by such License Subsidiary]
Number and
Number of Registered Class of Percentage
Issuer Certificates Owner Shares of Shares
------ ------------ ----- ------ ---------
LIMITED LIABILITY COMPANY MEMBERSHIP INTERESTS
1. [Legal Name of License Subsidiary]
2. [Legal form and jurisdiction of incorporation]
3. [Description of the License held by such License Subsidiary]
Number and
Number of Registered Class of Membership Percentage of
Issuer Certificates Owner Interests Membership Interests
------ ------------ ----- --------- --------------------
PARTNERSHIP INTERESTS
1. [Legal Name of License Subsidiary]
26
2. [Legal form and jurisdiction of incorporation]
3. [Description of the License held by such License Subsidiary]
Percentage of General
Number of General or or Limited Partnership
Issuer Certificates Limited Partner Interests
------ ------------ --------------- ---------