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EXHIBIT 1.1
May 2, 2001
Credit Suisse First Boston Corporation
2121 Avenue of the Stars
Los Angeles, California 90067
Dear Sirs and Mesdames:
Leap Wireless International, Inc., a Delaware corporation (the
"COMPANY"), proposes to issue and sell to Credit Suisse First Boston Corporation
(the "UNDERWRITER") 2,800,000 shares of its Common Stock, $.0001 par value per
share (the "FIRM SHARES").
The Company also proposes to issue and sell to the Underwriter
not more than an additional 200,000 shares of its Common Stock, $.0001 par value
per share (the "ADDITIONAL SHARES"), if and to the extent that the Underwriter
determines to exercise the right to purchase such shares of common stock granted
to the Underwriter in Section 2 hereof. The Firm Shares and the Additional
Shares are hereinafter collectively referred to as the "SHARES." The shares of
Common Stock, $.0001 par value per share, of the Company to be outstanding after
giving effect to the sales contemplated hereby are hereinafter referred to as
the "COMMON STOCK."
A registration statement on Form S-3 (File No. 333-45388),
including a prospectus, relating to the Shares has been filed by the Company
with the Securities and Exchange Commission (the "COMMISSION") and has become
effective. The registration statement as amended is hereinafter referred to as
the "REGISTRATION STATEMENT;" and the prospectus included in the Registration
Statement, as supplemented to reflect the terms of the offering of the Shares,
including all material incorporated therein by reference, is hereinafter
referred to as the "PROSPECTUS."
1. Representations and Warranties. The Company represents and
warrants to and agrees with the Underwriter that:
(a) The Registration Statement has become effective; no stop
order suspending the effectiveness of the Registration Statement is in
effect, and no proceedings for such purpose are pending before or, to
the Company's knowledge, threatened by the Commission.
(b) (i) The Registration Statement, when it became effective, did
not contain and, as amended or supplemented, as applicable, will not
contain any untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were
made, not misleading, (ii) each document filed or to be filed pursuant
to the Securities Exchange Act of 1934, as amended (the "EXCHANGE ACT"),
and incorporated by reference in the Prospectus complied or will comply
when so filed in all material respects with the
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Exchange Act and the applicable rules and regulations of the Commission
thereunder, (iii) the Registration Statement and the Prospectus comply
and, as amended or supplemented, as applicable, will comply in all
material respects with the Securities Act of 1933, as amended (the
"SECURITIES ACT"), and the applicable rules and regulations of the
Commission thereunder and (iv) the Prospectus does not contain and, as
amended or supplemented, as applicable, will not contain any untrue
statement of a material fact or omit to state a material fact necessary
to make the statements therein, in the light of the circumstances under
which they were made, not misleading, except that the representations
and warranties set forth in this paragraph do not apply to statements or
omissions in the Prospectus based upon information relating to the
Underwriter furnished to the Company in writing by the Underwriter
expressly for use therein. The Company acknowledges that for purposes of
this Agreement, the statements set forth in the paragraphs related to
stabilization, syndicate covering transactions and passive market making
and the effect thereof under the heading "Underwriting" constitute the
only information furnished in writing by or on behalf of the Underwriter
for inclusion in the Prospectus.
(c) The Company has been duly incorporated, is validly existing
as a corporation in good standing under the laws of the jurisdiction of
its incorporation, has the corporate power and authority to own its
property and to conduct its business as described in the Prospectus and
is duly qualified to transact business and is in good standing in each
jurisdiction in which the conduct of its business or its ownership or
leasing of property requires such qualification, except to the extent
that the failure to be so qualified or be in good standing would not
have a material adverse effect on the Company and its subsidiaries,
taken as a whole.
(d) Except for QUALCOMM Telecommunications Limited (Isle of Man),
Orrengrove Investments Limited and Transworld Telecommunications, Inc.,
each subsidiary of the Company has been duly incorporated, is validly
existing as a corporation in good standing under the laws of the
jurisdiction of its incorporation, has the corporate power and authority
to own its property and to conduct its business as described in the
Prospectus and is duly qualified to transact business and is in good
standing in each jurisdiction in which the conduct of its business or
its ownership or leasing of property requires such qualification, except
to the extent that the failure to be so qualified or be in good standing
would not have a material adverse effect on the Company and its
subsidiaries, taken as a whole; all of the issued shares of capital
stock of each subsidiary of the Company have been duly and validly
authorized and issued, are fully paid and non-assessable and, except as
described in the Prospectus, are owned directly by the Company or
indirectly through one of its subsidiaries, and are, except as described
in the Prospectus and except for a pledge of the shares of Cricket
Licensee VIII, Inc. and Cricket Licensee IX, Inc. in favor of Century
Personal Access Network, Inc. ("CPAN") to secure a note payable by the
Company to CPAN in the principal amount of $86,501,769, free and clear
of all liens, encumbrances, equities or claims.
(e) To the Company's knowledge, each of Pegaso Telecomunicaciones
S.A de C.V., Pegaso Humanos Recursos S.A. de C.V., Pegaso PCS S.A. de
C.V. and Pegaso Comunicaciones y Sistemas S.A. de C.V. (collectively,
the "PEGASO ENTITIES") has been
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duly incorporated, is validly existing as a corporation in good standing
under the laws of the jurisdiction of its incorporation, has the
corporate power and authority to own its property and to conduct its
business as described in the Prospectus and is duly qualified to
transact business and is in good standing in each jurisdiction in which
the conduct of its business or its ownership or leasing of property
requires such qualification, except to the extent that the failure to be
so qualified or be in good standing would not have a material adverse
effect on the Company and its subsidiaries, taken as a whole; all of the
issued shares of capital stock of the Pegaso Entities owned directly or
indirectly by the Company have been duly and validly authorized and
issued, are fully paid and non-assessable and those shares of capital
stock of the Pegaso entities owned directly or indirectly by the Company
are, except as described in the Prospectus, free and clear of all liens,
encumbrances, equities or claims. As of the date of this Agreement, the
Company owns 20.1% of the outstanding capital stock of Pegaso
Telecommunicaciones S.A de C.V. To the Company's knowledge, Pegaso
Telecommunicaciones S.A de C.V. owns 100% of the outstanding capital
stock of each of Pegaso Humanos Recursos S.A. de C.V., Pegaso PCS S.A.
de C.V. and Pegaso Comunicaciones y Sistemas S.A. de C.V. For purposes
of the representations and warranties contained in this Section 1 other
than paragraph (d), the Pegaso Entities shall be deemed subsidiaries;
provided that such representations and warranties shall be limited to
the Company's actual knowledge with respect to the Pegaso Entities.
(f) This Agreement has been duly authorized, executed and
delivered by the Company, and the Company has all requisite corporate
power and authority to (i) execute, deliver and perform its obligations
under this Agreement, and (ii) issue the Shares, in the manner and for
the purpose contemplated by this Agreement.
(g) The authorized capital stock of the Company conforms as to
legal matters to the description thereof contained in the Prospectus,
including without limitation under the caption "Description of Leap
Capital Stock".
(h) The shares of Common Stock outstanding prior to the issuance
of the Shares have been duly authorized and are validly issued, fully
paid and non-assessable.
(i) The Shares have been duly authorized and, when issued and
delivered in accordance with the terms of this Agreement, will be
validly issued, fully paid and non-assessable, and the issuance of such
Shares will not be subject to any preemptive or similar rights.
(j) The execution and delivery by the Company of, and the
performance by the Company of its obligations under, this Agreement will
not contravene (i) any provision of applicable law, (ii) the certificate
of incorporation or by-laws of the Company, (iii) any agreement or other
instrument binding upon the Company or any of its subsidiaries that is
material to the Company and its subsidiaries, taken as a whole, or (iv)
any judgment, order or decree of any governmental body, agency or court
having jurisdiction over the Company or any subsidiary. No consent,
approval, authorization or order of, or qualification with, any
governmental body or agency is required for the performance by the
Company of its obligations under this Agreement, except such as
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may be required by the securities or Blue Sky laws of the various states
or the Conduct Rules of NASD Regulation, Inc. in connection with the
offer and sale of the Shares.
(k) There has not occurred any material adverse change, or any
development involving a prospective material adverse change, in the
condition, financial or otherwise, or in the earnings, business or
operations of the Company and its subsidiaries, taken as a whole, from
that set forth in the Prospectus (exclusive of any amendments or
supplements thereto subsequent to the date of this Agreement).
(l) There are no legal or governmental proceedings pending or,
to the Company's knowledge, threatened to which the Company or any of
its subsidiaries is a party or to which any of the properties of the
Company or any of its subsidiaries is subject that are required to be
described in the Registration Statement or the Prospectus and are not so
described or any statutes, regulations, contracts or other documents
that are required to be described in the Registration Statement or the
Prospectus or to be filed as exhibits to the Registration Statement that
are not described or filed as required.
(m) Each preliminary prospectus, if any, filed as part of the
Registration Statement as originally filed or as part of any amendment
thereto, or filed pursuant to Rule 424 under the Securities Act,
complied when so filed in all material respects with the Securities Act
and the applicable rules and regulations of the Commission thereunder.
(n) The Company is not and, after giving effect to the offering
and sale of the Shares and the application of the proceeds thereof as
described in the Prospectus, will not be an "investment company" as such
term is defined in the Investment Company Act of 1940, as amended.
(o) The Company and its subsidiaries (i) are in compliance with
any and all applicable foreign, federal, state and local laws and
regulations relating to the protection of human health and safety, the
environment or hazardous or toxic substances or wastes, pollutants or
contaminants ("ENVIRONMENTAL LAWS"), (ii) have received all permits,
licenses or other approvals required of them under applicable
Environmental Laws to conduct their respective businesses and (iii) are
in compliance with all terms and conditions of any such permit, license
or approval, except where such noncompliance with Environmental Laws,
failure to receive required permits, licenses or other approvals or
failure to comply with the terms and conditions of such permits,
licenses or approvals would not, singly or in the aggregate, have a
material adverse effect on the Company and its subsidiaries, taken as a
whole.
(p) There are no costs or liabilities associated with
Environmental Laws (including, without limitation, any capital or
operating expenditures required for clean-up, closure of properties or
compliance with Environmental Laws or any permit, license or approval,
any related constraints on operating activities and any potential
liabilities to third parties) which would, singly or in the aggregate,
have a material adverse effect on the Company and its subsidiaries,
taken as a whole.
(q) Except as described in the Prospectus, there are no
contracts, agreements
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or understandings between the Company and any person granting such
person the right to require the Company to file a registration statement
under the Securities Act with respect to any securities of the Company
or to require the Company to include such securities with the Shares
registered pursuant to the Registration Statement. The rights under
Section 4.3 of the Superceding Warrant to Purchase 3,375,000 Shares of
Common Stock of the Company, dated as of December 12, 2000, in favor of
Qualcomm Incorporated ("QUALCOMM"), to require the Company to include
such securities with the Shares registered pursuant to the Registration
Statement have been waived.
(r) Subsequent to the respective dates as of which information is
given in the Registration Statement and the Prospectus, (i) the Company
and its subsidiaries have not incurred any liability or obligation,
direct or contingent, nor entered into any transaction, in each instance
not in the ordinary course of business, which is material to the Company
and its consolidated subsidiaries, taken as a whole; (ii) the Company
has not purchased any of its outstanding capital stock, nor declared,
paid or otherwise made any dividend or distribution of any kind on its
capital stock; and (iii) there has not been any change in the capital
stock, short-term debt or long-term debt of the Company and its
consolidated subsidiaries, which is material to the Company and its
consolidated subsidiaries, taken as a whole; except in each case as
described in the Prospectus.
(s) The Company and its subsidiaries have good and marketable
title to all real property and good and marketable title to all personal
property owned by them that is material to the business of the Company
and its consolidated subsidiaries, taken as a whole, in each case free
and clear of all liens, encumbrances and defects except such as are
described in the Prospectus or such as do not have a material adverse
effect singly or in the aggregate on the Company and its consolidated
subsidiaries, taken as a whole, or do not materially interfere with the
use made and proposed to be made of such property by the Company and its
subsidiaries; and any real property and buildings held under lease by
the Company and its subsidiaries are held by them under valid and
enforceable leases with such exceptions as do not materially interfere
with the use made and proposed to be made of such property and buildings
by the Company and its subsidiaries, in each case except as described in
the Prospectus.
(t) The Company and its subsidiaries own or possess all material
patents, patent rights, licenses, inventions, copyrights, know-how
(including trade secrets and other unpatented and/or unpatentable
proprietary or confidential information, systems or procedures),
trademarks, service marks and trade names currently employed by them in
connection with the business now operated by them. Neither the Company
nor any of its subsidiaries has received any notice of infringement of
or conflict with asserted rights of others with respect to any of the
foregoing which, singly or in the aggregate, if the subject of an
unfavorable decision, ruling or finding, would result in a material
adverse effect on the Company and its subsidiaries, taken as a whole.
(u) No material labor dispute with the employees of the Company
or any of its subsidiaries exists, or, to the knowledge of the Company,
is imminent; and the Company is not aware of any existing, threatened or
imminent labor disturbance by the employees
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of any of its principal suppliers, manufacturers or contractors that
could have a material adverse effect on the Company and its
subsidiaries, taken as a whole.
(v) The Company and its subsidiaries are insured by insurers of
recognized financial responsibility against such losses and risks and in
such amounts as are prudent and customary in the businesses in which
they are engaged; neither the Company nor any of its subsidiaries has
been refused any insurance coverage sought or applied for, except for a
requested increase in the directors' and officers' liability insurance
coverage which was refused with respect to litigation relating to the
Company's Russian subsidiaries and ventures; and neither the Company nor
any of its subsidiaries has any reason to believe that it will not be
able to renew its existing insurance coverage as and when such coverage
expires or to obtain similar coverage from similar insurers as may be
necessary to continue its business at a cost that would not have a
material adverse effect on the Company and its subsidiaries, taken as a
whole.
(w) The Company and its subsidiaries possess all licenses,
certificates, authorizations and permits issued by the appropriate
federal, state or foreign regulatory authorities necessary to conduct
their respective businesses, except where the failure to so possess
would not singly or in the aggregate have a material adverse effect on
the Company and its consolidated subsidiaries, taken as a whole. Neither
the Company nor any such subsidiary has received any notice of
proceedings relating to the revocation or modification of any such
license, certificate, authorization or permit which, singly or in the
aggregate, if the subject of an unfavorable decision, ruling or finding,
would have a material adverse effect on the Company and its consolidated
subsidiaries, taken as a whole, except as described in the Prospectus.
(x) Except as described in the Prospectus, the Company and its
subsidiaries (i) are in compliance in all material respects with any and
all applicable foreign, federal, state and local laws and regulations
relating to wireless communications services ("TELECOM LAWS"), (ii) have
received all material permits, licenses, concessions or other approvals
("TELECOM LICENSES") required of them under applicable Telecom Laws to
conduct their respective businesses, all of which were validly issued
and are in full force and effect, with no material restrictions or
qualifications except as described in the Prospectus (exclusive of any
amendments or supplements thereto subsequent to the date of this
Agreement), (iii) are in compliance in all material respects with all
terms and conditions of any such Telecom License and (iv) are eligible
to acquire and hold C-Block and F-Block licenses (as such terms are set
forth and further defined in 47 C.F.R. Part 24, Subparts H and I), and,
except as described in the Prospectus, have received all approvals,
consents, orders or authorizations from the Federal Communications
Commission ("FCC") necessary to establish such eligibility.
(y) Each of the Company and its subsidiaries has filed with the
FCC or applicable foreign regulatory authority all necessary and
material reports, documents, instruments, information and applications
required to be filed pursuant to applicable Telecom Laws.
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(z) Except as described in the Prospectus, the Company has no
reason to believe, and does not believe, that the Telecom Licenses will
not be renewed for a full term when they are due for renewal.
(aa) The Company and each of its subsidiaries maintain a system
of internal accounting controls sufficient to provide reasonable
assurance that (i) transactions are executed in accordance with
management's general or specific authorizations; (ii) transactions are
recorded as necessary to permit preparation of financial statements in
conformity with generally accepted accounting principles and to maintain
asset accountability; (iii) access to assets is permitted only in
accordance with management's general or specific authorization; and (iv)
the recorded accountability for assets is compared with the existing
assets at reasonable intervals and appropriate action is taken with
respect to any differences.
(bb) The Company and its subsidiaries have filed all federal,
foreign, state and local tax returns which have been required to be
filed and have paid all taxes required to be paid and any other
assessment, fine or penalty levied against them, to the extent that any
of the foregoing is due and payable, except, in all cases, for any such
tax, assessment, fine or penalty that is being contested in good faith
(and except in any case in which the failure to so file or pay would not
have a material adverse effect on the Company and its subsidiaries,
taken as a whole).
(cc) (1) Except as would not singly or in the aggregate have a
material adverse effect on the Company and its consolidated
subsidiaries, taken as a whole, the Company and its subsidiaries have
complied and are in compliance with all federal, state, local and
foreign statutes, executive orders, proclamations, regulations, rules,
directives, decrees, ordinances and similar provisions having the force
or effect of law and all judicial and administrative orders, rulings,
determinations and common law concerning the importation of merchandise,
the export or reexport of products, services and technology, and the
terms and conduct of international transactions applicable to the
Company and its subsidiaries in connection with the conduct of the
Company's or any subsidiary's business (including as the same relates to
record keeping requirements) ("INTERNATIONAL TRADE LAWS AND
REGULATIONS"); (2) except as would not singly or in the aggregate have a
material adverse effect on the Company and its consolidated
subsidiaries, taken as a whole, neither the Company nor any of its
subsidiaries has made or provided any false statement or omission to any
agency of any federal, state or local government, purchasers of
products, or foreign government or foreign agency, in connection with
the exportation of merchandise (including with respect to export
licenses, exceptions and other export authorizations and any filings
required for or related to exportation of any item), the importation of
merchandise or other approvals required by a foreign government or
agency or any other requirement relating to any International Trade Laws
and Regulations; and (3) neither the Company nor any of its subsidiaries
has made any payment, offer, gift, or promise to give, or authorized or
otherwise participated in, assisted or facilitated any payment or gift
related to the Company's or any subsidiary's business that is prohibited
by the United States Foreign Corrupt Practices Act.
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(dd) The Company has provided the Underwriter and counsel for the
Underwriter true and correct copies of (i) the Credit Agreement, dated
as of September 29, 1999, as Amended and Restated as of October 20,
2000, as amended, among Cricket Communications Holdings, Inc., Cricket
Communications, Inc., the lenders party thereto, and Lucent
Technologies, Inc., as Administrative Agent, (ii) the Credit Agreement,
dated August 28, 2000, as amended, among Cricket Communications
Holdings, Inc., Cricket Communications, Inc., the lenders party thereto,
and Nortel Networks Inc, as Administrative Agent, (iii) the Credit
Agreement, dated as of October 20, 2000, among Cricket Communications
Holdings, Inc., Cricket Communications, Inc., the lenders party thereto,
and Ericsson Credit AB, as Administrative Agent, (iv) the Loan
Agreement, dated as of January 22, 2001, by and between the Company and
Qualcomm and (v) the Amended and Restated Common Stock Purchase
Agreement, effective as of December 20, 2000, by and between the Company
and Acqua Wellington North American Equities Fund Ltd. (the "Acqua
Wellington Agreement"), including any amendments thereto or restatements
thereof, and all exhibits thereto, as in effect on the date hereof
(collectively, the "FINANCING AGREEMENTS").
(ee) Each of the Financing Agreements (i) has been duly
authorized, executed and delivered by, (ii) constitutes the valid and
binding obligation of and (iii) is enforceable in accordance with its
terms against, the Company and its subsidiaries, to the extent each is a
party thereto and, to the best of the Company's knowledge, the lenders
or purchasers party thereto, except as limited by applicable bankruptcy,
insolvency, reorganization, moratorium or other laws of general
application relating to or affecting enforcement of creditors' rights
and rules or laws concerning equitable remedies. The execution, delivery
and performance of the Financing Agreements by the Company and any of
its subsidiaries that is a party thereto, the compliance by the Company
and such subsidiaries with all of the provisions thereof and the
consummation of the transactions contemplated thereby do not (1) require
any consent, approval, authorization or other order of, or qualification
with, any court or governmental body or agency (except such as have
already been obtained), except where such failure to obtain any consent,
approval, authorization or other order or qualification would not singly
or in the aggregate have a material adverse effect on the Company and
its subsidiaries, taken as a whole, (2) conflict with or constitute a
breach of any of the terms or provisions of, or a default under (or an
event which with notice or lapse of time, or both, would constitute a
breach of or a default under), (x) the certificate of incorporation or
by-laws of the Company or any of its subsidiaries or (y) any indenture,
loan agreement, mortgage, lease or other agreement or instrument, to
which the Company or any of its subsidiaries is a party or by which the
Company or any of its subsidiaries are bound, except, with respect to
clause (y), for any such conflict, breach or default which, singly or in
the aggregate, would not have a material adverse effect on the Company
and its consolidated subsidiaries, taken as a whole, or (3) as of the
date hereof violate or conflict with any applicable law or any rule,
regulation, judgment, order or decree of any court or any governmental
body or agency having jurisdiction over the Company or any of its
subsidiaries, except for any such violation or conflict which would not
singly or in the aggregate have a material adverse effect on the Company
and its consolidated subsidiaries, taken as a whole.
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(ff) The consolidated financial statements of the Company
together with related notes set forth in the Prospectus fairly present
the financial condition of the Company and its subsidiaries, as of the
dates indicated, and the results of operations and changes in financial
position for the periods therein specified in conformity with generally
accepted accounting principles consistently applied throughout the
periods involved (except as otherwise stated therein); the summary and
selected financial data in the Prospectus present fairly in all material
respects the financial information shown therein and have been prepared
and compiled on a basis consistent with audited financial statements
included therein, except as otherwise stated therein; and the pro forma
financial information and the related notes thereto included in the
Prospectus have been prepared using reasonable assumptions and include
all adjustments necessary to present fairly in all material respects the
pro forma financial information included in the Prospectus at the
respective dates and for the respective periods indicated.
PricewaterhouseCoopers LLP and Pricewaterhouse Coopers, which have
reported upon certain of the audited financial statements included in
the Prospectus, is an independent public accounting firm as required by
the Securities Act and the rules and regulations thereunder.
(gg) No relationship, direct or indirect, exists between or among
the Company or any of its subsidiaries on the one hand, and the
directors, officers, stockholders, customers, suppliers or contractors
of the Company and its subsidiaries, on the other hand, which is
required to be described in the Prospectus which is not so described.
(hh) There are no contracts or agreements between the Company and
any person requiring the Company to give notice to such person of the
offer and sale of the Shares hereunder or granting to such person a
right to purchase Common Stock as a result of the offer and sale of the
Shares hereunder.
2. Agreements to Sell and Purchase. The Company hereby agrees to
sell to the Underwriter, and the Underwriter, upon the basis of the
representations and warranties herein contained, but subject to the conditions
hereinafter stated, agrees to purchase from the Company, the Firm Shares at
U.S.$32.70 a share ("PURCHASE PRICE").
On the basis of the representations and warranties contained in
this Agreement, and subject to the terms and conditions set forth herein, the
Company agrees to sell to the Underwriter the Additional Shares, and the
Underwriter shall have the right to purchase up to 200,000 Additional Shares at
the Purchase Price. The Underwriter may exercise such option in full or in part
from time to time by delivering written notice to the Company not later than 30
days after the date of this Agreement, which notice or notices shall specify the
number of Additional Shares to be purchased by the Underwriter and the date on
which such shares are to be purchased. Such date may be the same as the Closing
Date (as defined below) but not earlier than the Closing Date nor later than ten
business days after the date of such notice. Additional Shares may be purchased
as provided in Section 4 hereof solely for the purpose of covering
over-allotments made in connection with the offering of the Firm Shares.
The Company hereby agrees that, without the prior written consent
of the Underwriter, it will not, during the period ending 90 days after the date
of the Prospectus,
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(i) offer, pledge, sell, contract to sell, sell any option or contract to
purchase, purchase any option or contract to sell, grant any option, right or
warrant to purchase, lend, or otherwise transfer or dispose of, directly or
indirectly, any shares of Common Stock or any securities convertible into or
exercisable or exchangeable for Common Stock or (ii) enter into any swap or
other arrangement that transfers to another, in whole or in part, any of the
economic consequences of ownership of the Common Stock, whether any such
transaction described in clause (i) or (ii) above is to be settled by delivery
of Common Stock or such other securities, in cash or otherwise. The foregoing
sentence shall not apply to (a) the Shares to be sold hereunder; (b) the
issuance by the Company of shares of Common Stock upon the exercise of an option
or warrant or the conversion of any security outstanding on the date hereof of
which the Underwriter has been advised in writing or which is described in the
Prospectus; (c) the issuance by the Company of shares of Common Stock in
connection with, and as consideration for, acquisitions of wireless licenses or
voice or data telecommunications assets or technologies, provided that the
persons to whom such shares are issued (other than the persons receiving shares
pursuant to the acquisition agreements entered into prior to the date hereof and
listed in Schedule I hereto) enter into a "lock-up" agreement, substantially in
the form of Exhibit A hereto; (d) the issuance by the Company of shares of
Common Stock or securities convertible into or exercisable for shares of Common
Stock in a private placement transaction, provided that the persons to whom such
shares are issued enter into a "lock-up" agreement, substantially in the form of
Exhibit A hereto; (e) the issuance Draw Down Notices and Call Options (as such
terms are defined in the Aqua Wellington Agreement) pursuant to the Acqua
Wellington Agreement and the issuance of shares of Common Stock pursuant to such
Draw Down Notices or Call Options, provided that such any such issuance of a
Draw Down Notice, Call Option or shares of Common Stock is made at least 30 days
after the date of the Prospectus and the Draw Down Amount (as defined in such
agreement) does not exceed the dollar amounts specified in Section 6.1(a) of the
Acqua Wellington Agreement without giving effect to any mutual agreement of the
parties to alter such amounts; and (f) the grant by the Company of options to
purchase Common Stock or the issuance of Common Stock pursuant to the Company's
equity and incentive plans as in effect on the date hereof, copies of which are
incorporated by reference as exhibits to the Registration Statement (except for
the Leap Wireless International, Inc. 1998 Employee Stock Purchase Plan, as
amended, the 2001 Executive Officer Deferred Bonus Stock Plan and the 2001
Non-Qualified Stock Option Plan, which have not yet been filed as exhibits).
3. Terms of Public Offering. The Underwriter advises the Company
that it proposes to make a public offering of the Shares as soon after this
Agreement has become effective as in its judgment is advisable. The Underwriter
further advises the Company that the Shares are to be offered to the public
initially at U.S.$33.50 a share (the "PUBLIC OFFERING PRICE").
4. Payment and Delivery. Payment for the Firm Shares shall be
made to the Company in Federal or other funds immediately available in New York
City against delivery of such Firm Shares for the account of the Underwriter at
10:00 a.m., New York City time, on May 8, 2001, or at such other time on the
same or such other date, not later than May 11, 2001, as shall be designated in
writing by the Underwriter. The time and date of such payment are hereinafter
referred to as the "CLOSING DATE."
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Payment for any Additional Shares shall be made to the Company in
Federal or other funds immediately available in New York City against delivery
of such Additional Shares for the account of the Underwriter at 10:00 a.m., New
York City time, on the date specified in the notice described in Section 2 or at
such other time on the same or on such other date, in any event not later than
June 8, 2001, as shall be designated in writing by the Underwriter. The time and
date of such payment are hereinafter referred to as the "OPTION CLOSING DATE."
Certificates for the Firm Shares and Additional Shares shall be
in definitive form and registered in such names and in such denominations as you
shall request in writing not later than one full business day prior to the
Closing Date or the Option Closing Date, as the case may be. The certificates
evidencing the Firm Shares and Additional Shares shall be delivered to the
Underwriter on the Closing Date or the Option Closing Date, as the case may be,
for the account of the Underwriter, with any transfer taxes payable in
connection with the transfer of the Shares to the Underwriter duly paid, against
payment of the Purchase Price therefor.
5. Conditions to the Underwriter's Obligations. The obligations
of the Company to sell the Shares to the Underwriter and the obligation of the
Underwriter to purchase and pay for the Shares on the Closing Date are subject
to the following conditions:
(a) Subsequent to the execution and delivery of this Agreement
and prior to the Closing Date:
(i) there shall not have occurred any downgrading, nor
shall any notice have been given of any intended or potential
downgrading or of any review for a possible change that does not
indicate the direction of the possible change, in the rating
accorded any of the Company's debt securities by any "nationally
recognized statistical rating organization," as such term is
defined for purposes of Rule 436(g)(2) under the Securities Act;
and
(ii) there shall not have occurred any change, or any
development involving a prospective change, in the condition,
financial or otherwise, or in the earnings, business or
operations of the Company and its subsidiaries, taken as a whole,
from that set forth in the Prospectus (exclusive of any
amendments or supplements thereto subsequent to the date of this
Agreement) that, in your judgment, is so material and adverse
that it makes it, in your judgment, impracticable to market the
Shares on the terms and in the manner contemplated in the
Prospectus.
(b) The Underwriter shall have received on the Closing Date a
certificate, dated the Closing Date and signed by an executive officer
of the Company, to the effect set forth in Section 5(a)(i) above and to
the effect that the representations and warranties of the Company
contained in this Agreement are true and correct as of the Closing Date
and that the Company has complied with all of the agreements and
satisfied all of the conditions on its part to be performed or satisfied
hereunder on or before the Closing Date. The officer signing and
delivering such certificate may rely upon the best of his or her
knowledge as to proceedings threatened.
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(c) The Underwriter shall have received on the Closing Date an
opinion of Latham & Watkins, outside counsel for the Company, dated the
Closing Date, to the effect that:
(i) the Company has been duly incorporated, and is validly
existing and in good standing under the laws of the State of
Delaware, with corporate power and authority to own its property
and to conduct its business as described in the Prospectus. Based
solely on certificates from public officials, such counsel shall
confirm that the Company is qualified to do business in the
states listed on Schedule I thereto;
(ii) each domestic subsidiary of the Company has been duly
incorporated, and is validly existing and in good standing under
the laws of the jurisdiction of its incorporation, with the
corporate power and authority to own its property and to conduct
its business as described in the Prospectus;
(iii) the authorized capital stock of the Company conforms
as to legal matters to the description thereof under the caption
"Description of Leap Capital Stock" contained in the Prospectus;
(iv) the Shares of Common Stock outstanding prior to the
issuance of the Shares have been duly authorized and are validly
issued, fully paid and non-assessable;
(v) the shares to be issued and sold by the Company
pursuant to the Underwriting Agreement have been duly authorized
and when issued to and paid for by the Underwriter in accordance
with the terms of this Agreement, will be validly issued, fully
paid and non-assessable, and, to the best of such counsel's
knowledge, free of preemptive rights;
(vi) all of the issued shares of capital stock of each
domestic subsidiary of the Company have been duly and validly
authorized and issued, are fully paid and non-assessable;
(vii) this Agreement has been duly authorized, executed
and delivered by the Company;
(viii) the Company has all requisite corporate power and
authority to (i) execute, deliver and perform its obligations
under this Agreement, and (ii) issue the Shares, in the manner
and for the purpose contemplated by this Agreement;
(ix) the execution and delivery by the Company of, and the
compliance by the Company with the provisions of, this Agreement
will not result in a violation by the Company of its certificate
of incorporation or by-laws, or the Delaware General Corporation
Law or any federal or California statute, rule or regulation
known to us to be applicable to the Company (other than federal
or state securities laws or the Communications Act of 1934, as
amended (the
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"COMMUNICATIONS ACT"), or the rules, regulations, decisions and
written policies of the FCC (the "FCC RULES"), which are
specifically addressed elsewhere herein), or any agreement listed
in the Exhibit Index to the Registration Statement at the time
the Registration Statement becomes effective or any judgment,
order or decree of any governmental body, or agency specifically
directed to the Company or any domestic subsidiary and identified
to such counsel by an officer of the Company as material to the
Company. No consent, approval, authorization or order of, or
filing with, any federal or California court or governmental
agency or body is required for the compliance by the Company with
the provisions of this Agreement, except such as have been
obtained or as may be required under state securities laws in
connection with the purchase and distribution of such Shares by
the Underwriter;
(x) the statements in the Prospectus under the captions
"Business -- Government Regulation" and "Description of Capital
Stock," in each case insofar as such statements constitute
summaries of the legal matters, documents or proceedings referred
to therein, are accurate in all material respects;
(xi) to the best of such counsel's knowledge, there are no
contracts or other documents, or legal or governmental
proceedings to which the Company or any of its subsidiaries is
party, that are required to be described in the Registration
Statement or the Prospectus or to be filed as exhibits to the
Registration Statement that are not described and filed as
required;
(xii) the Company is not and, after giving effect to the
offering and sale of the Shares and the application of the
proceeds thereof as described in the Prospectus, will not be an
"investment company" as such term is defined in the Investment
Company Act of 1940, as amended;
(xiii) each document filed pursuant to the Exchange Act
and incorporated by reference in the Registration Statement and
the Prospectus (except for financial statements, schedules and
other financial data included or incorporated by reference in, or
omitted from, the Registration Statement or the Prospectus as to
which such counsel need not express any opinion) complied when so
filed as to form in all material respects with the requirements
for such documents under the Exchange Act and the applicable
rules and regulations of the Commission thereunder. The
Registration Statement and Prospectus (except for financial
statements and schedules and other financial data included or
incorporated by reference in, or omitted from, the Registration
Statement or the Prospectus as to which such counsel need not
express any opinion) comply as to form in all material respects
with the requirements for registration statements on Form S-3
under the Securities Act and the applicable rules and regulations
of the Commission thereunder. In passing upon the compliance as
to form of each such document filed pursuant to the Exchange Act
and the Registration Statement and the Prospectus, such counsel
may assume that the statements made and incorporated by reference
therein are correct and complete;
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(xiv) Schedule III attached thereto includes all licenses,
authorizations, and permits required under the Communications Act
or the FCC Rules, which are necessary for the Company and its
domestic subsidiaries to conduct their business as such counsel
has been advised they are now conducted and as proposed to be
conducted immediately following the Closing Date (the "FCC
LICENSES"). Schedule III attached thereto accurately sets forth
each such license, the name of the licensee, the call letters (if
applicable), the class of service, geographic scope and the
expiration date for each of the FCC Licenses, each of which is in
full force and effect;
(xv) except as described in the Prospectus, other than
rulemaking proceedings or similar proceedings generally affecting
the commercial mobile radio services industry, there is no
proceeding before the FCC that is pending or, to the best of such
counsel's knowledge, threatened against the Company, its domestic
subsidiaries or any of their officers, directors or shareholders,
including any FCC complaint, investigation, notice of apparent
liability, order of forfeiture, proceeding pursuant to an
exercise of pre-emptive authority under 47 U.S.C. Section 252, or
other administrative action or proceeding, regarding the business
of the Company and its domestic subsidiaries (i) that is likely
to result in a forfeiture or termination, revocation, adverse
modification, non-renewal, short-term renewal, or other material
impairment of any of the FCC Licenses, or (ii) that reasonably
could be expected to materially and adversely affect the
operations or condition, financial or otherwise, of the Company
or its domestic subsidiaries or the ability of the Company to
perform its obligations under this Agreement;
(xvi) no authorization or approval or other action by, and
no notice to or filing with, the FCC is required under the
Communications Act or the FCC Rules: (i) in connection with the
due execution and delivery by the Company of this Agreement; or
(ii) for the exercise by the Underwriter of any of its rights and
remedies under this Agreement; and
(xvii) the execution and delivery by the Company of this
Agreement and the performance by the Company of its obligations
under this Agreement (i) do not contravene the Communications Act
or any FCC Rule and (ii) do not and will not result in any
suspension, revocation, material impairment or non-renewal of any
FCC License material to the Company's and its domestic
subsidiaries' operations and business.
In addition, such counsel shall state in the opinion that
it has participated in conferences with officers and other
representatives of the Company, representatives of the
independent public accountants for the Company, and
representatives of the Underwriter, at which the contents of the
Registration Statement and the Prospectus and related matters
were discussed and, although it is not passing upon, and does not
assume any responsibility for, the accuracy, completeness or
fairness of the statements contained or incorporated by reference
in the Registration Statement and the Prospectus and has not made
any independent check or verification thereof, during the course
of such participation,
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no facts came to its attention that caused it to believe that the
Registration Statement, at the time it became effective,
contained an untrue statement of a material fact or omitted to
state a material fact required to be stated therein or necessary
to make the statements therein not misleading, or that the
Prospectus, as of the Closing Date, contained an untrue statement
of a material fact or omitted to state a material fact necessary
to make the statements therein, in light of the circumstances
under which they were made, not misleading; it being understood
that such counsel expresses no belief with respect to the
financial statements, schedules and other financial data included
or incorporated by reference in, or omitted from, the
Registration Statement or the Prospectus.
In addition, the Underwriter shall have received on the
Closing Date an opinion of the general counsel of the Company, dated the
Closing Date, to the effect that each domestic subsidiary of the Company
is qualified to transact business and in good standing in each
jurisdiction in which the conduct of its business or its ownership or
leasing of property requires such qualification, except to the extent
that the failure to be so qualified or be in good standing would not
have a material adverse effect on the Company and its subsidiaries,
taken as a whole.
(d) The Underwriter shall have received on the Closing Date an
opinion of O'Melveny & Myers LLP, counsel for the Underwriter, dated the
Closing Date, covering the matters referred to in Sections 5(c)(v),
5(c)(vii), 5(c)(x) (but only as to the statements in the Prospectus
under "Description of Leap Capital Stock") and Section 5(c)(xiii) above.
With respect to Section 5(c)(xiii) above, O'Melveny & Myers LLP
may state that its opinion and belief are based upon its participation
in a review and discussion of the Registration Statement and Prospectus
and any amendments or supplements thereto and documents incorporated by
reference, but are without independent check or verification, except as
specified.
The opinion of Latham & Watkins described in Section 5(c) above
shall be rendered to the Underwriter at the request of the Company and
shall so state therein.
(e) The Underwriter shall have received, on each of the date
hereof and the Closing Date, a letter dated the date hereof or the
Closing Date, as the case may be, in form and substance satisfactory to
the Underwriter, from PricewaterhouseCoopers LLP, independent public
accountants, containing statements and information of the type
ordinarily included in accountants' "comfort letters" to underwriters
with respect to the financial statements and certain financial
information (including the pro forma financial statements) contained in
the Registration Statement and the Prospectus; provided that the letter
delivered on the Closing Date shall use a "cut-off date" not earlier
than the date hereof.
(f) "Lock-up" agreements shall have been executed and delivered
by the officers and directors of the Company, each in substantially the
form of Exhibit A hereto, and by Qualcomm Incorporated, in substantially
the form of Exhibit A-1 hereto, relating
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to sales and certain other dispositions of shares of Common Stock or
certain other securities, and such agreements shall be in full force and
effect on the Closing Date.
The obligations of the Underwriter to purchase Additional Shares
hereunder are subject to the delivery to the Underwriter on the Option Closing
Date of such documents as it may reasonably request with respect to the good
standing of the Company and its subsidiaries, the due authorization and issuance
of the Additional Shares and other matters related to the issuance of the
Additional Shares.
6. Covenants of the Company. In further consideration of the
agreements of the Underwriter herein contained, the Company covenants with the
Underwriter as follows:
(a) To furnish to you, without charge, three conformed copies of
the Registration Statement (including exhibits thereto and documents
incorporated by reference) and to furnish to you in New York City,
without charge, prior to 10:00 a.m. New York City time on the business
day next succeeding the date of this Agreement and during the period
mentioned in Section 6(c) below, as many copies of the Prospectus, any
documents incorporated by reference, and any supplements and amendments
thereto or to the Registration Statement as you may reasonably request.
The terms "supplement" and "amendment" or "amend" as used in this
Agreement shall include all documents subsequently filed by the Company
with the Commission pursuant to the Exchange Act that are deemed to be
incorporated by reference in the Prospectus.
(b) Before amending or supplementing the Registration Statement
or the Prospectus, to furnish to you a copy of each such proposed
amendment or supplement and not to file any such proposed amendment or
supplement to which you reasonably object, and to file with the
Commission within the applicable period specified in Rule 424(b) under
the Securities Act any prospectus required to be filed pursuant to such
Rule.
(c) If, during such period after the first date of the public
offering of the Shares as in the opinion of counsel for the Underwriter
the Prospectus is required by law to be delivered in connection with
sales by an Underwriter or dealer, any event shall occur or condition
exist as a result of which it is necessary to amend or supplement the
Prospectus in order to make the statements therein, in the light of the
circumstances when the Prospectus is delivered to a purchaser, not
misleading, or if, in the opinion of counsel for the Underwriter, it is
necessary to amend or supplement the Prospectus to comply with
applicable law, forthwith to prepare, file with the Commission and
furnish, at its own expense, to the Underwriter and to the dealers
(whose names and addresses the Underwriter will furnish to the Company)
to which Shares may have been sold by the Underwriter and to any other
dealers upon request, either amendments or supplements to the Prospectus
so that the statements in the Prospectus as so amended or supplemented
will not, in the light of the circumstances when the Prospectus is
delivered to a purchaser, be misleading or so that the Prospectus, as
amended or supplemented, will comply with law.
(d) To endeavor to qualify the Shares for offer and sale under
the securities or Blue Sky laws of such jurisdictions as you shall
reasonably request.
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(e) To make generally available to the Company's security holders
and to you as soon as practicable an earning statement covering the
twelve-month period ending June 30, 2002 that satisfies the provisions
of Section 11(a) of the Securities Act and the rules and regulations of
the Commission thereunder.
(f) As soon as practicable following the Closing Date, to file
with the Commission a post-effective amendment to the Registration
Statement amending the plan of distribution section therein to add a
statement to the effect that the maximum compensation to be paid to any
member of the NASD in connection with any offering shall not exceed 8%,
other than with respect to transactions under the Acqua Wellington
Agreement.
7. Expenses. Whether or not the transactions contemplated in this
Agreement are consummated or this Agreement is terminated, the Company shall pay
or cause to be paid all expenses incident to the performance of its obligations
under this Agreement, including: (i) the fees, disbursements and expenses of the
Company's counsel and the Company's accountants in connection with the
registration and delivery of the Shares under the Securities Act and all other
fees or expenses in connection with the preparation and filing of the
Registration Statement, any preliminary prospectus, the Prospectus and
amendments and supplements to any of the foregoing, including all printing costs
associated therewith, and the mailing and delivering of copies thereof to the
Underwriter and dealers, in the quantities hereinabove specified, (ii) all costs
and expenses related to the transfer and delivery of the Shares to the
Underwriter, including any transfer or other taxes payable thereon, (iii) the
cost of printing or producing any Blue Sky or Legal Investment memorandum in
connection with the offer and sale of the Shares under state securities laws and
all expenses in connection with the qualification of the Shares for offer and
sale under state securities laws as provided in Section 6(d) hereof, including
filing fees and the reasonable fees and disbursements of counsel for the
Underwriter in connection with such qualification and in connection with the
Blue Sky or Legal Investment memorandum, (iv) all filing fees incurred in
connection with the review and qualification of the offering of the Shares by
the National Association of Securities Dealers, Inc., (v) all costs and expenses
incident to the quotation of the Shares on the Nasdaq National Market, (vi) the
cost of printing certificates representing the Shares, (vii) the costs and
charges of any transfer agent, registrar or depositary, and (viii) all other
costs and expenses incident to the performance of the obligations of the Company
hereunder for which provision is not otherwise made in this Section. It is
understood, however, that except as provided in this Section 7, Section 8
entitled "Indemnity and Contribution," and the last paragraph of Section 10
below, the Underwriter will pay all of its costs and expenses, including,
without limitation, fees and disbursements of its counsel, stock transfer taxes
payable on resale of any of the Shares by it and any advertising expenses
connected with any offers it may make.
8. Indemnity and Contribution.
(a) The Company agrees to indemnify and hold harmless the
Underwriter and each person, if any, who controls the Underwriter within
the meaning of either Section 15 of the Securities Act or Section 20 of
the Exchange Act, from and against any and all losses, claims, damages
and liabilities (including, without limitation, any legal or other
expenses reasonably incurred in connection with defending or
investigating any such
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action or claim) caused by any untrue statement or alleged untrue
statement of a material fact contained in the Registration Statement or
any amendment thereof, any preliminary prospectus or the Prospectus (as
amended or supplemented if the Company shall have furnished any
amendments or supplements thereto), or caused by any omission or alleged
omission to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading, except
insofar as such losses, claims, damages or liabilities are caused by any
such untrue statement or omission or alleged untrue statement or
omission based upon information relating to the Underwriter furnished to
the Company in writing by the Underwriter expressly for use therein;
provided, however, that the foregoing indemnity agreement with respect
to any preliminary prospectus shall not inure to the benefit of the
Underwriter from whom the person asserting any such losses, claims,
damages or liabilities purchased Shares, or any person controlling the
Underwriter, if a copy of the Prospectus (as then amended or
supplemented if the Company shall have furnished any amendments or
supplements thereto) was not sent or given by or on behalf of the
Underwriter to such person, if required by law so to have been
delivered, at or prior to the written confirmation of the sale of the
Shares to such person, and if the Prospectus (as so amended or
supplemented) would have cured the defect giving rise to such losses,
claims, damages or liabilities, unless such failure is the result of
noncompliance by the Company with Section 6(a) hereof.
(b) The Underwriter agrees to indemnify and hold harmless the
Company, its directors, its officers who sign the Registration Statement
and each person, if any, who controls the Company within the meaning of
either Section 15 of the Securities Act or Section 20 of the Exchange
Act to the same extent as the foregoing indemnity from the Company to
the Underwriter, but only with reference to information relating to the
Underwriter furnished to the Company in writing expressly for use in the
Prospectus. The Company acknowledges that for purposes of this
Agreement, the statements set forth in the paragraphs related to
stabilization, syndicate covering transactions and passive market making
and the effect thereof under the heading "Underwriting" constitute the
only information furnished in writing by or on behalf of the Underwriter
for inclusion in the Prospectus.
(c) In case any proceeding (including any governmental
investigation) shall be instituted involving any person in respect of
which indemnity may be sought pursuant to Section 8(a) or 8(b), such
person (the "INDEMNIFIED PARTY") shall promptly notify the person
against whom such indemnity may be sought (the "INDEMNIFYING PARTY") in
writing, and the indemnifying party, upon request of the indemnified
party, shall retain counsel reasonably satisfactory to the indemnified
party to represent the indemnified party and any others the indemnifying
party may designate in such proceeding and shall pay the fees and
disbursements of such counsel related to such proceeding. In any such
proceeding, any indemnified party shall have the right to retain its own
counsel, but the fees and expenses of such counsel shall be at the
expense of such indemnified party unless (i) the indemnifying party and
the indemnified party shall have mutually agreed to the retention of
such counsel or (ii) the named parties to any such proceeding (including
any impleaded parties) include both the indemnifying party and the
indemnified party and representation of both parties by the same counsel
would be inappropriate due to actual or potential differing interests
between them. It is understood that the indemnifying party
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shall not, in respect of the legal expenses of any indemnified party in
connection with any proceeding or related proceedings in the same
jurisdiction, be liable for the fees and expenses of more than one
separate firm (in addition to any local counsel) for all such
indemnified parties and that all such fees and expenses shall be
reimbursed as they are incurred. Such firm shall be designated in
writing by the Underwriter, in the case of parties indemnified pursuant
to Section 8(a), and by the Company, in the case of parties indemnified
pursuant to Section 8(b). The indemnifying party shall not be liable for
any settlement of any proceeding effected without its written consent,
but if settled with such consent or if there be a final judgment for the
plaintiff, the indemnifying party agrees to indemnify the indemnified
party from and against any loss or liability by reason of such
settlement or judgment. Notwithstanding the foregoing sentence, if at
any time an indemnified party shall have requested an indemnifying party
to reimburse the indemnified party for fees and expenses of counsel as
contemplated by the second and third sentences of this paragraph, the
indemnifying party agrees that it shall be liable for any settlement of
any proceeding effected without its written consent if (i) such
settlement is entered into more than 30 days after receipt by such
indemnifying party of the aforesaid request and (ii) such indemnifying
party shall not have reimbursed the indemnified party in accordance with
such request prior to the date of such settlement. No indemnifying party
shall, without the prior written consent of the indemnified party,
effect any settlement of any pending or threatened proceeding in respect
of which any indemnified party is or could have been a party and
indemnity could have been sought hereunder by such indemnified party,
unless such settlement includes an unconditional release of such
indemnified party from all liability on claims that are the subject
matter of such proceeding.
(d) To the extent the indemnification provided for in Section
8(a) or 8(b) is unavailable to an indemnified party or insufficient in
respect of any losses, claims, damages or liabilities referred to
therein, then each indemnifying party under such paragraph, in lieu of
indemnifying such indemnified party thereunder, shall contribute to the
amount paid or payable by such indemnified party as a result of such
losses, claims, damages or liabilities (i) in such proportion as is
appropriate to reflect the relative benefits received by the Company on
the one hand and the Underwriter on the other hand from the offering of
the Shares or (ii) if the allocation provided by clause 8(d)(i) above is
not permitted by applicable law, in such proportion as is appropriate to
reflect not only the relative benefits referred to in clause 8(d)(i)
above but also the relative fault of the Company on the one hand and of
the Underwriter on the other hand in connection with the statements or
omissions that resulted in such losses, claims, damages or liabilities,
as well as any other relevant equitable considerations. The relative
benefits received by the Company on the one hand and the Underwriter on
the other hand in connection with the offering of the Shares shall be
deemed to be in the same respective proportions as the net proceeds from
the offering of the Shares (before deducting expenses) received by the
Company and the total underwriting discounts and commissions received by
the Underwriter, in each case as set forth in the table on the cover of
the Prospectus, bear to the aggregate Public Offering Price of the
Shares. The relative fault of the Company on the one hand and the
Underwriter on the other hand shall be determined by reference to, among
other things, whether the untrue or alleged untrue statement of a
material fact or the omission or alleged omission to state a material
fact relates to information supplied by
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the Company or by the Underwriter and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent
such statement or omission.
(e) The Company and the Underwriter agree that it would not be
just or equitable if contribution pursuant to this Section 8 were
determined by pro rata allocation or by any other method of allocation
that does not take account of the equitable considerations referred to
in Section 8(d). The amount paid or payable by an indemnified party as a
result of the losses, claims, damages and liabilities referred to in the
immediately preceding paragraph shall be deemed to include, subject to
the limitations set forth above, any legal or other expenses reasonably
incurred by such indemnified party in connection with investigating or
defending any such action or claim. Notwithstanding the provisions of
this Section 8, the Underwriter shall not be required to contribute any
amount in excess of the amount by which the total price at which the
Shares underwritten by it and distributed to the public were offered to
the public exceeds the amount of any damages that the Underwriter has
otherwise been required to pay by reason of such untrue or alleged
untrue statement or omission or alleged omission. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any person who
was not guilty of such fraudulent misrepresentation. The remedies
provided for in this Section 8 are not exclusive and shall not limit any
rights or remedies which may otherwise be available to any indemnified
party at law or in equity.
(f) The indemnity and contribution provisions contained in this
Section 8 and the representations, warranties and other statements of
the Company contained in this Agreement shall remain operative and in
full force and effect regardless of (i) any termination of this
Agreement, (ii) any investigation made by or on behalf of the
Underwriter or any person controlling the Underwriter or by or on behalf
of the Company, its officers or directors or any person controlling the
Company and (iii) acceptance of and payment for any of the Shares.
9. Termination. This Agreement shall be subject to termination by
notice given by you to the Company, if (a) after the execution and delivery of
this Agreement and prior to the Closing Date (i) trading generally shall have
been suspended or materially limited on or by, as the case may be, any of the
New York Stock Exchange, the American Stock Exchange, the National Association
of Securities Dealers, Inc., the Chicago Board of Options Exchange, the Chicago
Mercantile Exchange or the Chicago Board of Trade, (ii) trading of any
securities of the Company shall have been suspended on any exchange or in any
over-the-counter market, (iii) a general moratorium on commercial banking
activities in New York shall have been declared by either Federal or New York
State authorities or (iv) there shall have occurred any outbreak or escalation
of hostilities or any change in financial markets or any calamity or crisis
that, in your judgment, is material and adverse and (b) in the case of any of
the events specified in clauses 9(a)(i) through 9(a)(iv), such event, singly or
together with any other such event, makes it, in the judgment of the
Underwriter, impracticable to market the Shares on the terms and in the manner
contemplated in the Prospectus.
10. Effectiveness. This Agreement shall become effective upon the
execution and delivery hereof by the parties hereto.
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If this Agreement shall be terminated by the Underwriter because
of any failure or refusal on the part of the Company to comply with the terms or
to fulfill any of the conditions of this Agreement, or if for any reason the
Company shall be unable to perform its obligations under this Agreement, the
Company will reimburse the Underwriter for all out-of-pocket expenses (including
the fees and disbursements of its counsel) reasonably incurred by the
Underwriter in connection with this Agreement or the offering contemplated
hereunder.
11. Counterparts. This Agreement may be signed in two or more
counterparts, each of which shall be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument.
12. Applicable Law. This Agreement shall be governed by and
construed in accordance with the internal laws of the State of New York.
13. Headings. The headings of the sections of this Agreement have
been inserted for convenience of reference only and shall not be deemed a part
of this Agreement.
[Remainder of page intentionally left blank]
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Very truly yours,
LEAP WIRELESS INTERNATIONAL, INC.
By: /s/ SUSAN G. SWENSON
-------------------------------------
Name: Susan G. Swenson
Title: President
S-1
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Accepted as of the date hereof:
CREDIT SUISSE FIRST BOSTON CORPORATION
By: /s/ NIRON STABINSKY
-------------------------------------
Name: Niron Stabinsky
Title: Director
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EXHIBIT A
FORM OF LOCK-UP LETTER
May __, 2001
Credit Suisse First Boston Corporation
2121 Avenue of the Stars
Los Angeles, California 90067
Dear Sirs and Mesdames:
The undersigned understands that Credit Suisse First Boston
Corporation (the "UNDERWRITER") proposes to enter into an Underwriting Agreement
(the "UNDERWRITING AGREEMENT") with Leap Wireless International, Inc., a
Delaware corporation (the "COMPANY"), providing for the public offering (the
"PUBLIC OFFERING") by the Underwriter of shares (the "SHARES") of the Common
Stock, $.0001 par value per share, of the Company (the "COMMON STOCK").
To induce the Underwriter to continue its efforts in connection
with the Public Offering, the undersigned hereby agrees that, without the prior
written consent of the Underwriter, it will not, during the period commencing on
the date hereof and ending 90 days after the date of the final prospectus
relating to the Public Offering (the "PROSPECTUS"), (1) offer, pledge, sell,
contract to sell, sell any option or contract to purchase, purchase any option
or contract to sell, grant any option, right or warrant to purchase, lend, or
otherwise transfer or dispose of, directly or indirectly, any shares of Common
Stock or any securities convertible into or exercisable or exchangeable for
Common Stock or (2) enter into any swap or other arrangement that transfers to
another, in whole or in part, any of the economic consequences of ownership of
the Common Stock, whether any such transaction described in clause (1) or (2)
above is to be settled by delivery of Common Stock or such other securities, in
cash or otherwise. The foregoing sentence shall not apply to (a) the sale of any
Shares to the Underwriter pursuant to the Underwriting Agreement or (b)
transactions relating to shares of Common Stock or other securities acquired in
open market transactions after the completion of the Public Offering. In
addition, the undersigned agrees that, without the prior written consent of the
Underwriter, it will not, during the period commencing on the date hereof and
ending 90 days after the date of the Prospectus, make any demand for or exercise
any right with respect to, the registration of any shares of Common Stock or any
security convertible into or exercisable or exchangeable for Common Stock.
Notwithstanding the foregoing (i) gifts and transfers by will or intestacy or
(ii) transfers to (A) the undersigned's members, partners, affiliates or
immediate family or (B) a trust, the beneficiaries of which are the undersigned
and/or members of the undersigned's immediate family, shall not be prohibited by
this agreement; provided that (x) the donee or transferee agrees in writing to
be bound by the foregoing in the same manner as it applies to the undersigned
and (y) if the donor or transferor is a reporting person subject to
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Section 16(a) of the Securities Exchange Act of 1934 (the "EXCHANGE ACT"), any
gifts or transfers made in accordance with this paragraph shall not require such
person to, and such person shall not voluntarily, file a report of such
transaction on Form 4 under the Exchange Act. "IMMEDIATE FAMILY" shall mean
spouse, lineal descendants, father, mother, brother or sister of the transferor
and father, mother, brother or sister of the transferor's spouse.
Whether or not the Public Offering actually occurs depends on a
number of factors, including market conditions. Any Public Offering will only be
made pursuant to an Underwriting Agreement, the terms of which are subject to
negotiation between the Company and the Underwriter.
Very truly yours,
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(Signature)
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(Printed Name)
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(Address)
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EXHIBIT A-1
FORM OF QUALCOMM LOCK-UP LETTER
May 2, 2001
Credit Suisse First Boston Corporation
2121 Avenue of the Stars
Los Angeles, California 90067
Dear Sirs and Mesdames:
The undersigned understands that Credit Suisse First Boston
Corporation (the "UNDERWRITER") propose to enter into an Underwriting Agreement
(the "UNDERWRITING AGREEMENT") with Leap Wireless International, Inc., a
Delaware corporation (the "COMPANY"), providing for the public offering (the
"PUBLIC OFFERING") by the Underwriter of shares (the "SHARES") of the Common
Stock, $.0001 par value per share, of the Company (the "COMMON STOCK").
To induce the Underwriter to continue its efforts in connection
with the Public Offering, the undersigned hereby agrees that, without the prior
written consent of the Underwriter, it will not, during the period commencing on
the date hereof and ending on the End Date (as defined below), (1) offer,
pledge, sell, contract to sell, sell any option or contract to purchase,
purchase any option or contract to sell, grant any option, right or warrant to
purchase, lend, or otherwise transfer or dispose of, directly or indirectly, any
shares of Common Stock or any securities convertible into or exercisable or
exchangeable for Common Stock or (2) enter into any swap or other arrangement
that transfers to another, in whole or in part, any of the economic consequences
of ownership of the Common Stock, whether any such transaction described in
clause (1) or (2) above is to be settled by delivery of Common Stock or such
other securities, in cash or otherwise. The "END DATE" shall mean (i) 15 days
after the date of the supplemental prospectus pursuant to which the Public
Offering is effected (the "PROSPECTUS") with respect to any shares of Common
Stock owned by the undersigned on the date hereof and (ii) 45 days after the
date of the Prospectus with respect to any securities convertible into or
exercisable for shares of Common Stock or shares of Common Stock acquired after
the date hereof upon conversion or exercise of such securities. The foregoing
sentence shall not apply to transactions relating to shares of Common Stock or
other securities acquired in open market transactions after the completion of
the Public Offering. In addition, the undersigned agrees that, without the prior
written consent of the Underwriter, it will not, during the period commencing on
the date hereof and ending 45 days after the date of the Prospectus, require the
filing of any registration statement pursuant to any demand for or exercise of
any right with respect to, the registration of any shares of Common Stock or any
security convertible into or exercisable or exchangeable for Common Stock.
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Notwithstanding the foregoing, (i) the obligations of the
undersigned as set forth in this letter shall be conditioned on the executive
officers and directors of the Company executing a similar lock-up agreement, and
(ii) this letter agreement shall terminate and be of no further force or effect
in the event that the Prospectus is not dated on or before May 8, 2001.
Whether or not the Public Offering actually occurs depends on a
number of factors, including market conditions. Any Public Offering will only be
made pursuant to an Underwriting Agreement, the terms of which are subject to
negotiation between the Company and the Underwriter.
Very truly yours,
QUALCOMM INCORPORATED
By:
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Anthony S. Thornley
Executive VP & Chief Financial
Officer
Address:
5775 Morehouse Drive
San Diego, California
92121-1714
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