Exhibit 2.7
EXECUTION
THIRD AMENDED AND RESTATED
SECURITYHOLDERS AGREEMENT
by and among
MAXCOM TELECOMUNICACIONES, S.A. DE C.V.
(formerly known as Amaritel, S.A. de C.V.)
and
CERTAIN OF ITS SECURITYHOLDERS
DATED AS OF JULY 20, 2006
TABLE OF CONTENTS
PAGE
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SECTION 1. DEFINITIONS................................................... 2
SECTION 2. BOARD OF DIRECTORS............................................ 8
(A) BOARD COMPOSITION................................................. 8
(B) DIRECTOR VACANCIES................................................ 9
(C) SUBSIDIARY BOARDS................................................. 9
(D) COMMITTEES........................................................ 9
(E) ADVISORY COMMITTEE................................................ 9
(F) REMOVAL OF DIRECTORS.............................................. 9
(G) COVERED PERSONS LIABILITY......................................... 10
(H) EXPENSES.......................................................... 10
SECTION 3. BOARD AND SECURITYHOLDER ACTIONS.............................. 10
(A) REQUIRED APPROVALS................................................ 10
(B) NEXUS KEY MATTERS................................................. 11
(C) GRUPO VAC KEY MATTERS............................................. 12
(D) NEXUS AND GRUPO VAC KEY MATTERS................................... 12
(E) GRUPO VAC VOTING LIMITATIONS...................................... 14
(F) ADDITIONAL APPROVALS.............................................. 14
(G) GRUPO VAC VOTING RIGHTS TERMINATION............................... 14
SECTION 4. COVENANTS..................................................... 15
(A) FINANCIAL STATEMENTS AND OTHER INFORMATION........................ 15
(B) COMPLIANCE WITH U.S. FOREIGN CORRUPT PRACTICES ACT................ 17
(C) INSPECTION OF PROPERTY............................................ 17
(D) CONFIDENTIALITY................................................... 17
(E) UBTI.............................................................. 18
(F) SHAREHOLDERS MEETINGS............................................. 18
SECTION 5. RESTRICTIONS ON TRANSFER OF SHARES............................ 18
(A) TRANSFER OF SHARES................................................ 18
(B) RESTRICTED SHARES................................................. 18
(C) RIGHTS OF FIRST REFUSAL ON TRANSFERS BY NON-INVESTORS............. 19
(D) RIGHT OF FIRST OFFER ON TRANSFERS BY INVESTORS (OTHER THAN BA
INVESTORS)..................................................... 20
(E) PARTICIPATION (TAG-ALONG) RIGHTS IN TRANSFERS..................... 21
-i-
(F) DRAG ALONG RIGHTS................................................. 23
(G) GRUPO VAC RIGHT OF FIRST OFFER ON CERTAIN TRANSFERS AND LIMITED
OFFER RIGHT ON CERTAIN SALE OF COMPANY TRANSACTIONS............ 25
(H) AGREEMENT REGARDING INDIRECT TRANSFERS............................ 30
(I) PERMITTED TRANSFEREES............................................. 31
(J) PUBLIC OFFERING PROVISIONS........................................ 31
(K) SHARES HELD BY CPO TRUSTEE........................................ 34
(L) PARTICIPATION RIGHT (TAG-ALONG RIGHTS) ON TRANSFERS BY QUALIFIED
INVESTORS TO OTHER QUALIFIED INVESTORS......................... 34
(M) RESTRICTION ON COMPETITION BY GRUPO VAC INVESTORS................. 36
(N) TERMINATION....................................................... 36
SECTION 6. FOREIGN INVESTMENT AND TELECOMMUNICATION LAW.................. 37
SECTION 7. SHARE CERTIFICATE NOTATION.................................... 37
SECTION 8. MISCELLANEOUS................................................. 38
(A) AMENDMENT AND WAIVER.............................................. 38
(B) SUCCESSORS AND ASSIGNS............................................ 38
(C) COUNTERPARTS...................................................... 38
(D) NOTICES........................................................... 38
(E) GOVERNING LAW; JURISDICTION....................................... 39
(F) ARBITRATION....................................................... 39
(G) GOVERNING LANGUAGE................................................ 40
(H) U.S. GAAP......................................................... 40
(I) RULE OF CONSTRUCTION.............................................. 40
(J) FURTHER ASSURANCES................................................ 40
(K) COMPLETE AGREEMENT................................................ 40
(L) SPECIAL PROVISIONS FOR OPTIONHOLDERS.............................. 40
(M) TERMINATION OF AGREEMENT.......................................... 41
(N) UNDERSTANDING AMONG THE SECURITYHOLDERS........................... 41
(O) ACKNOWLEDGMENT RE ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇ LLP............................ 42
THIRD AMENDED AND RESTATED
SECURITYHOLDERS AGREEMENT
THIS THIRD AMENDED AND RESTATED SECURITYHOLDERS AGREEMENT (this
"Agreement") is entered into as of July 20, 2006 by and among (i) Maxcom
Telecomunicaciones, S.A. de C.V. (formerly known as Amaritel, S.A. de C.V.), a
corporation organized under the laws of Mexico (the "Company"), (ii) each of the
entities listed on the signature pages hereto, and (iii) each of the
shareholders of the Company listed on the signature pages hereto. The
shareholders and, as applicable, optionholders are referred to herein
collectively as the "Securityholders" and individually as a "Securityholder".
Except as otherwise indicated herein, capitalized terms used herein are defined
in Section 1 hereof.
WHEREAS, on May 21, 1998, the Company, certain investors, the Existing
Securityholders and Bancomer, S.A., Institucion de Banca Multiple, Grupo
Financiero Bancomer, Direccion Fiduciaria, as trustee, executed and delivered an
Irrevocable Administration and Security Trust Agreement (as amended from time to
time, the "Security Trust Agreement");
WHEREAS, on May 23, 1998 the Company shareholders entered into a
Securityholders Agreement (the "Original Securityholders Agreement");
WHEREAS, on February 21, 2000, the Company shareholders approved a
restructuring of the Company's capital structure, including the authorization of
(i) the issuance of nominative Series C shares of the Company with full voting
rights and no par value (the "Series C Shares"), (ii) the conversion of a
portion of the then existing Series A, Series B and Series N Shares into Series
C Shares, (iii) creation of an Irrevocable Neutral Investment Trust (the
"Neutral Investment Trust"), into which the Company (with respect to certain
treasury stock) and the holders of Series N Shares and certain holders of Series
A Shares and Series B Shares deposited such shares, fifty percent of which
shares, simultaneously with their deposit into the trust estate, were converted
into Series C Shares (and in the case of the Series A Shares and Series B
Shares, were converted into Series C Shares and Series N Shares), and (iv) the
issuance by Banco Nacional de Mexico, S.A., Institucion de Banca Multiple, Grupo
Financiero Banamex Accival, Division Fiduciaria as Trustee with respect to the
Neutral Investment Trust of ordinary participation certificates to the settlors
of the Neutral Investment Trust (with each one ordinary participation
certificate representing one Series C Share and one Series N Share)
(collectively, the "First Restructuring");
WHEREAS, on August 18, 2000 the Original Securityholders Agreement was
amended and restated to, among other things, reflect the First Restructuring (as
amended and restated, the "First Amended and Restated Securityholders
Agreement");
WHEREAS, on March 5, 2002, the Company shareholders approved, a second
restructuring of the Company's capital structure, including the authorization of
(i) the conversion of the issued and outstanding Series C Shares into Series N
Shares, (ii) the termination and liquidation of the Neutral Investment Trust,
(iii) the elimination of certain ownership restrictions on the Series N Shares,
(iv) the elimination of the voting rights of Series N Shares, (v) the increase
in the authorized capital stock of the Company, (vi) the authorization and
issuance of preferred Series A-1 Shares, Series B-1 Shares, Series N-1 Shares
and Series N-2 Shares and (vii) the granting of certain approval rights to the
Series B-1 Shares (collectively, the "Second Restructuring");
1
WHEREAS, the General Bureau of Foreign Investment of the Ministry of
Economy of Mexico (the "Bureau") reviewed and approved the Second Restructuring
and the issuance of the new shares created thereunder;
WHEREAS, on April 22, 2002, the Company filed its Second Amended and
Restated Bylaws with the Public Registry of Property and Commerce of Mexico,
Federal District and with the Bureau for approval of all provisions of such
Second Amended and Restated Bylaws which differed from the form of the Company
Bylaws submitted previously to the Bureau for approval, and the Bureau approved
all such provisions;
WHEREAS, as of April 29, 2002, the Neutral Investment Trust was
terminated and the shares of the Company deposited therein were distributed to
the holders;
WHEREAS, on April 29, 2002 the parties hereto amended and restated the
First Amended and Restated Securityholders Agreement for purposes, among other
things of: (i) including new shareholders of the Company as parties, (ii)
reflecting the Second Restructuring, (iii) amending the rights of the existing
Series A Shares, Series B Shares and Series N Shares, (iv) establishing the
rights of new Series A-1 Shares, Series B-1 Shares, Series N-1 Shares and Series
N-2 Shares and (v) amending the composition and operation of the Company's Board
of Directors (the "Board");
WHEREAS, on July 17, 2006 the Company shareholders approved a
restructuring of the Company's capital structure, including the authorization of
(i) the issuance of 2,825,124 Series A Shares and 75,988,379 Series N Shares
(the "Grupo VAC Shares") representing approximately 16.34% of the total Shares
of the Company authorized as of the signing date and (ii) the conversion of all
then existing Series A-1, Series B-1, Series N-1 and Series N-2 Shares into
Series A, Series B and Series N Shares, respectively, along with the elimination
of certain preferred rights (collectively, the "Third Restructuring");
WHEREAS, the Company will file on or prior to July 31, 2006 its Third
Amended and Restated Bylaws, a true and complete copy of the English translation
of which is attached hereto as Exhibit A with the Public Registry of Property
and Commerce of Mexico, Federal District; and
WHEREAS, the parties hereto desire to amend and restate the Second
Amended and Restated Securityholders Agreement for purposes, among other things
of: (i) including new shareholders of the Company as parties, (ii) reflecting
the Third Restructuring, (iii) amending the rights of the existing Series A
Shares, Series B Shares and Series N Shares, (iv) eliminating the rights of
Series A-1 Shares, Series B-1 Shares, Series N-1 Shares and Series N-2 Shares,
and (v) amending the composition and operation of the Company's Board of
Directors (the "Board").
NOW, THEREFORE, in consideration of the mutual covenants contained
herein and other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereto hereby amend and restate the
Second Amended and Restated Securityholders Agreement to reflect (i) the
inclusion of the Grupo VAC Investors as a party hereto, (ii) the omission of
certain former Shareholders as parties hereto and (iii) the following
agreements:
SECTION 1. Definitions.
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Capitalized terms used herein will have the meaning set forth in this
Section 1.
"Advisory Committee" has the meaning set forth in Section 2(e).
"Affiliate" of any Person means any other Person controlling, controlled by
or under common control with such particular Person, and "control" means the
possession, directly or indirectly, of the power to direct the management,
policies, assets and ownerships of a Person, whether through the ownership of
voting securities, contract or otherwise.
"▇▇▇▇▇▇▇ Group Investors" means, with respect to the Series A Shares only,
collectively, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ G., ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ G. and ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇ G., and their respective successors in interest and Permitted
Transferees.
"Approved Plan" has the meaning set forth in Section 3(d)(iv).
"BA Investors" means, collectively, BankAmerica International Investment
Corporation, BankAmerica Investment Corporation, BASCFC-Maxcom Holdings I, LLC,
BAS Capital Funding Corporation, Nexus-Maxcom Holdings I, LLC, Nexus-Banc of
America Fund II, L.P., ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ and their respective successors in
interest and Permitted Transferees.
"Bachow Investors" means, collectively, Bachow Investment Partners III, LP
("BIP"), Bachow & Associates, Inc., each of the limited partners of BIP, the
general partner of BIP (and its limited partners and general partners), the
direct and indirect equity holders of any thereof, ▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇ and ▇▇▇ ▇. ▇▇▇▇ and each of their respective successors and permitted
assigns and permitted transferees.
"Bank of America" means, Bank of America Corporation and any successor in
interest thereto.
"Bansi Credit Agreement" means the credit agreement with fiduciary
guarantee and joint guarantor, dated as of December 20, 2004, by and between
Bansi, S.A. Institucion de Banca Multiple as Lender, Telereunion, S.A. de C.V.
as Borrower and Telereunion International, S.A. de C.V. as Guarantor for an
amount of up to MX$51,000,000.00.
"Bureau" has the meaning set forth in the recitals to this Agreement.
"Board" has the meaning set forth in the recitals to this Agreement.
"Business" means the business of providing local, long distance and network
telecommunications services in Mexico pursuant to concessions and/or permits
issued by the Mexican government and the sale or rental of related equipment to
subscribers of such services.
"Committee" has the meaning set forth in Section 2(d).
"Company" means Maxcom Telecomunicaciones, S.A. de C.V., a Mexican stock
corporation with variable capital, and any successor-in-interest thereto.
"Company Bylaws" means that certain Maxcom Telecomunicaciones, S.A. de C.V.
Third Amended and Restated By-Laws, dated as of July 17, 2006, as such agreement
may be amended
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from time to time thereafter pursuant to the terms and restrictions set forth
therein, a true and complete copy of which is attached as Exhibit A hereto.
"Covered Persons" has the meaning set forth in Section 2(g).
"Covered Transaction" has the meaning set forth in Section 5(g)(v).
"CPO" means a certificate of participation issued to a beneficiary of the
trust established pursuant to the CPO Investment Trust Agreement.
"CPO Investment Trust Agreement" means that certain Irrevocable Investment
Trust Agreement, dated as of April 29, 2002, by and among the Company and the
bank initially appointed by Company as the trustee thereunder, as such agreement
may be amended from time to time thereafter pursuant to its terms and the
restrictions set forth in the Company Bylaws.
"CPO Trustee" means the trustee under the CPO Investment Trust Agreement
and any successor thereto.
"Drag-Along Sale" has the meaning set forth in Section 5(f)(i).
"Equity Securities" means any equity securities of an issuer or debt
securities of an issuer with equity features or other securities exercisable or
convertible into equity securities of such issuer or any of its subsidiaries
(including, without limitation, Options) or any other securities of such issuer
containing any profit participation features (including, without limitation,
stock appreciation rights and phantom stock).
"Exempt Transfers" has the meaning set forth in Section 5(b).
"Family Group" with respect to a natural person, means such natural
person's spouse, parents, siblings and descendents (whether natural or adopted)
and any trust solely for the benefit of such natural person and/or such natural
person's spouse and/or descendents (whether natural or adopted).
"Grupo VAC Agreements" means the TR Purchase Agreement, the Holdback Trust
Agreement, CFE Credit Agreement, Security Trust Agreement, Securityholders'
Agreement, the Post-Closing Matters Side Letter Agreements, the Bansi Credit
Agreement, and any agreement between the Company or any of its Subsidiaries and
Sierra Communications Globales, S.A. de C.V.
"Grupo VAC Director" has the meaning set forth in Section 2(a)(i).
"Grupo VAC Investors" means ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ de ▇▇▇▇▇▇▇ ▇▇▇▇▇▇,
Telereunion International, S.A. de C.V., Controladora Profesional Regiomontana,
S.A. de C.V., and their respective successors in interest and Permitted
Transferees.
"Grupo VAC Key Matter" has the meaning set forth in Section 3(c).
"Grupo VAC Limited Offer" has the meaning set forth in Section 5(g).
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"Grupo VAC Offer" has the meaning set forth in Section 5(g)(ii).
"Grupo VAC Offer Right Conditions: has the meaning set forth in Section
5(g)(i).
"Grupo VAC RLO Notice" has the meaning set forth in Section 5(g).
"Grupo VAC Representative" means ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ so long as
he is a Grupo VAC Investor, and thereafter, such person as designated in writing
to the Company by the Grupo VAC Investors holding a plurality of all Shares held
of record by the Grupo VAC Investors.
"Grupo VAC ROFO Notice" has the meaning set forth in Section 5(g)(i).
"Grupo VAC Threshold Percentage" means 11%; provided, however, that if,
after the date the Company Bylaws are adopted by the shareholders, the Company
issues Shares as consideration for the acquisition by the Company or its
subsidiaries of the assets or capital stock of one or more companies, and as the
result of such issuance of Shares, the Grupo VAC Investors' beneficial ownership
of outstanding Shares is less than 11%, then the Grupo VAC Threshold Percentage
shall be 7%.
"Guidelines" means the Company Guidelines attached hereto as Exhibit B.
"Holdback Trust Agreement" means the Irrevocable Administration and
Holdback Security Trust Agreement, dated as of July 20, 2006, as such agreement
may be amended from time to time thereafter pursuant to its terms, among the
Company, the Grupo VAC Investors and Banco Mercantil del Norte, S.A.,
Institucion de Banca Multiple, Grupo Financiero Banorte, as trustee.
"Independent Third Party" means, at any applicable date of determination,
any Person, other than any holder of more than 5% of the Shares issued and
outstanding on such date; provided, however, that the Grupo VAC Investors and
their Affiliates shall be deemed Independent Third Parties hereunder for
purposes of the definition of "Sale of the Company".
"Investors" means the ▇▇▇▇▇▇▇ Group Investors, BA Investors, the Grupo VAC
Investors, the Bachow Investors, Latinvest Strategic Investment Fund, L.P., and
Credit Suisse First Boston Corporation. For purposes of the registration rights
set forth in Section 5(j), "Investor" also includes ▇.▇. ▇▇▇▇▇▇▇▇, III, ▇▇▇▇▇▇▇
▇. ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇.
"Investor Transfer Notice" has the meaning set forth in Section 5(d)(i).
"Neutral Investment Trust" has the meaning set forth in the recitals to
this Agreement.
"Nexus" means, collectively, Nexus-Maxcom Holdings I, LLC and Nexus-Banc of
America Fund II, L.P. (together with any successor-in-interest).
"Nexus Director" has the meaning set forth in Section 2(a)(ii).
"Nexus Key Matter" has the meaning set forth in Section 3(b).
"Non-CPO Securityholder" has the meaning set forth in Section 5(c)(i).
5
"Offer Notice" means a notice disclosing the number of Shares to be
transferred, the proposed price, terms and conditions of the Transfer and the
identity of the prospective transferee(s) who submitted the offer.
"Option" means a right, option or warrant to subscribe for or to purchase
any series of Shares.
"Permitted Transferees" has the meaning set forth in Section 5(i).
"Person" means an individual, a partnership, a corporation, a limited
liability company, an association, a joint stock company, a trust, a joint
venture, an unincorporated organization, or a governmental entity or any
department, agency or political subdivision thereof.
"Post-Closing Matters Side Letter Agreement" has the meaning set forth in
the TR Purchase Agreement.
"Public Offering" means the consummation of a public offering (whether a
primary or a secondary offering) registered under the Mexican securities laws,
rules and regulations or the Securities Act of Shares, CPOs, certificates of
participation, American depositary receipts or other similar securities
representing an economic ownership interest in Shares.
"Public Sale" means any sale of Shares to the public (i) pursuant to an
offering registered under the Mexican securities laws and/or the United States
securities laws in accordance with the registration statement covering such
Shares or (ii) through a broker, dealer or market maker pursuant to the
provisions of Rule 144 (or similar provision then in force) adopted under the
United States securities laws.
"Qualified Affiliate" of any Person means (i) any other Person 90% or more
of whose equity and other voting securities are beneficially owned by such
Person or (ii) any other Person who beneficially owns 90% or more of the equity
and other voting securities of such Person (it being understood that,
notwithstanding the foregoing, each of the BA Investors, Nexus Partners I, LLC
(and any private equity fund managed by Nexus Partners I, LLC) and any Affiliate
of Bank of America in which Bank of America holds, directly or indirectly, at
least a majority of the economic interests thereof shall be deemed to be
Qualified Affiliates of one another).
"Qualified Investor" has the meaning set forth in Section 5(d)(i).
"Qualified Public Offering" means a Public Offering that yields aggregate
net proceeds to the Company of at least U.S.$50,000,000 (fifty million U.S.
dollars).
"Recusal" has the meaning set forth in Section 5(g)(xi).
"Registration Request" has the meaning set forth in Section 5(j)(ii).
"Regulatory Amendments" means any amendment of the Foreign Investment Law
and the Federal Telecommunications Law of Mexico permitting the unrestricted
ownership and/or control of the Company by one or more foreign entities.
"Required Approvals" has the meaning set forth in Section 3(a).
6
"Restricted Matters" has the meaning set forth in Section 5(g)(xi).
"Restricted Persons" has the meaning set forth in Section 3(d)(ii).
"Restricted Share(s)" has the meaning set forth in Section 5(b).
"Restricted Share Transfer Consent" has the meaning set forth in Section
5(b).
"RFR Free Transfer Period" has the meaning set forth in Section 5(c)(iii).
"ROFO Free Transfer Period" has the meaning set forth in Section 5(d)(iii).
"ROFO-RLO Free Period" has the meaning set forth in Section 5(g)(ii).
"Sale of the Company" shall mean any transaction or series of related
transactions involving (i) a sale of all or substantially all of the
consolidated assets of the Company to any Independent Third Party or group of
Independent Third Parties or (ii) a merger, recapitalization or reorganization
of the Company, the sale or transfer of assets of, or any equity interest in, or
any securities convertible into or exchangeable for an equity interest, in the
Company, or other similar transaction or business combination involving the
Company, in each case after which at least a majority of the beneficial and
record ownership of the Shares then outstanding would be owned by any
Independent Third Party or group of Independent Third Parties.
"Second Amended and Restated Bylaws" means the Bylaws of the Company
approved by the shareholders of the Company on March 5, 2002.
"Securities Act" means the U.S. Securities Act of 1933, as amended, and the
rules and regulations promulgated thereunder.
"Securityholder" means any shareholder and, as applicable, any optionholder
of the Company.
"Security Trust Agreement" means the Third Amended and Restated Irrevocable
Administration and Security Trust Agreement, dated as of July 20, 2006, by and
among the Company, certain Securityholders and Bancomer, S.A., Institucion de
Banca Multiple, Grupo Financiero Bancomer, Direccion Fiduciaria, as trustee, as
such agreement may be further amended from time to time thereafter pursuant to
its terms.
"Series A Directors" has the meaning set forth in Section 2(a)(i).
"Series B Directors" has the meaning set forth in Section 2(a)(ii).
"Series A Shares" means the Company's nominative, series A shares with full
voting rights, no par value and which may only be held by Mexican individuals or
Mexican entities with a clause in their by-laws prohibiting foreign ownership.
"Series B Shares" means the Company's nominative, series B shares with full
voting rights, no par value and which may be held by Mexican and foreign
individuals or entities.
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"Series N Shares" means the Company's nominative, series N shares without
voting rights and no par value (and, without limitation of the foregoing, for
all purposes hereunder, includes any securities converted into Series N Shares
on or prior to the date of this Agreement).
"Shares" means, at any given time, collectively, the Company's (i) Series A
Shares, (ii) Series B Shares, (iii) Series N Shares, and (iv) any subsequently
authorized series or class of capital stock of the Company. For purposes of
clarification, CPOs are not Shares.
"Strategic Combination" has the meaning set forth in Section 5(g)(vi).
"Subsidiary Board" has the meaning set forth in Section 2(c).
"Tag-Along Right Notice" has the meaning set forth in Section 5(e)(i).
"Tag-Along Window" has the meaning set forth in Section 5(e)(ii).
"TR Purchase Agreement" means the Share Purchase and Sale Agreement, dated
as of July 20, 2006, by and among Telereunion International, S.A. de C.V.,
Controladora Profesional Regiomontana, S.A. de C.V., ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, the Company and Maxcom
Servicios Administrativos, S.A. de C.V, as such agreement may be amended from
time to time thereafter pursuant to its terms.
"Transaction Agreements" means (i) the Company Bylaws, (ii) this Agreement,
(iii) the Guidelines attached hereto as Exhibit B, (iv) the Security Trust
Agreement, (v) the CPO Investment Trust Agreement, (vi) any Grupo VAC Agreement,
and (vii) each of the other instruments and agreements contemplated hereby and
thereby. Transaction Agreements shall include, to the extent applicable, each
Transaction Agreement as such agreement may be amended from time to time in
accordance with its terms and this Agreement.
"Transfer" means, with respect to any interest, any direct or indirect
sale, exchange, transfer, assignment, pledge or other disposition (whether with
or without consideration and whether voluntarily or involuntarily or by
operation of law) of any such interest (including, without limitation, a
beneficial interest in such interest).
"Transferring Non-Investor Securityholder(s)" has the meaning set forth in
Section 5(c).
"Transferring Securityholder" has the meaning set forth in Section 5(e)(i).
SECTION 2. BOARD OF DIRECTORS.
(a) Board Composition. Subject to the provisions set forth in Section 6
hereof, the Company shall be managed by the Board and the Board shall be
composed of 9 (nine) members and the same number of alternate members. An
alternate member of the Board may only serve as alternate director for the Board
member for whom such alternate Board member is specifically designated to serve
as an alternate. The following individuals shall be elected to the Board:
(i) 5 (five) members (and 5 (five) alternates) designated by the
holders of the Series A Shares. Of such Board members and alternates, 1
(one) member (and its respective alternate) shall be designated by the
Grupo VAC Investors; provided, however, that (A) the
8
Grupo VAC Investors continue to hold, in the aggregate, at least the Grupo
VAC Threshold Percentage of the issued and outstanding Shares of Maxcom and
(B) the Grupo VAC Investors and their respective Affiliates fully comply
with the conditions set forth in Section 5(m) (the "Grupo VAC Director").
The remainder of such board members (and alternates) shall be designated by
the holders of a majority of the Series A Shares present at a shareholders'
meeting and entitled to vote thereat voting together as a single class on
any such designation (the "Series A Directors"); and
(ii) 4 (four) members (and 4 (four) alternates) designated by the
holders of a majority of the Series B Shares present at a shareholders'
meeting and entitled to vote thereat voting together as a single class on
any such designation (the "Series B Directors"); provided, however, that a
Series B Director (and alternate) shall only be elected if nominated as a
Series B Director (or alternate, as the case may be), by Nexus (any Series
B Director actually nominated by Nexus and elected by the holders of a
majority of the Series B Shares acting jointly, a "Nexus Director");
(b) Director Vacancies. Unless otherwise required by applicable Mexican
law, if any party entitled to designate a Director pursuant to the terms of this
Section 2 fails to do so, such Director seat shall remain vacant until filled in
accordance with this Section 2.
(c) Subsidiary Boards. At the request of any Nexus Director or the Grupo
VAC Director, the composition of the board of directors or similar body of each
of the Company's subsidiaries (a "Subsidiary Board") shall include at least 1
(one) Nexus Director and 1 (one) Grupo VAC Director.
(d) Committees. At the request of any Nexus Director or Grupo VAC Director,
each committee of the Board and each committee of each Subsidiary Board (each, a
"Committee") shall include at least 1 (one) Nexus Director and 1 (one) Grupo VAC
Director.
(e) Advisory Committee. The Board shall establish an advisory committee
(the "Advisory Committee"). The Advisory Committee shall be responsible for
advising the Board regarding, and shall oversee, the Company's continuing
operations; provided, however, that the Advisory Committee shall not have the
authority to approve any matters and shall only have the authority to recommend
matters to the full Board. The Advisory Committee shall include (i) the
Company's then current Chief Executive Officer, (ii) ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ G., (iii) 1
(one) Grupo VAC Director (so long as the Grupo VAC Investors are entitled to
appoint 1 (one) Grupo VAC Director), and (iv) 3 (three) Series B Directors
(including at least 2 (two) Nexus Directors).
(f) Removal of Directors. The removal (with or without cause) of any member
of the Board, a Subsidiary Board or a Committee shall be only upon written
request of the Securityholder(s) who designated such member. If any individual
ceases, for any reason, to serve as a member of the Board, a Subsidiary Board or
a Committee, the vacancy shall be filled by a new member selected by the
Securityholder(s) who designated such member. If any member of the Board (or
with respect to a Subsidiary Board or any Committee, any Nexus Director) cannot
attend any meetings thereof, the alternate member designated by the
Securityholder(s) who designated such member (or by Nexus, with respect to the
Nexus Director) may attend such meetings in lieu of the absent Board member, and
such alternate member shall be given all written notices, materials and
information regarding all meetings of the Board, such Subsidiary Board or
Committee and shall be
9
entitled to vote at such meeting as a member of the Board, such Subsidiary Board
or Committee (it being understood that any alternate member may nonetheless
attend any meeting of the Board, a Subsidiary Board or a Committee of the Board
as an observer and shall be entitled to receive copies of all materials and
information regarding such meeting, even if the principal Board member is
present, but in no event shall such alternate member vote in such meeting of the
Board if the principal Board member is present at such meeting). If a member of
the Board, a Subsidiary Board or a Committee and such member's alternate member
of the Board, Subsidiary Board or Committee both attend a meeting of the Board,
a Subsidiary Board or Committee, only the member of the Board, Subsidiary Board
or Committee (as opposed to the alternate member) shall be entitled to vote at
such meeting.
(g) Covered Persons Liability. None of the members of the Board, Subsidiary
Board or of any Committee (including alternate members), and none of the
Company's officers (collectively, "Covered Persons") shall be liable to any
Securityholder or the Company for (i) any action taken or inaction in good faith
with respect to the Company which is not a violation of the material provisions
of this Agreement and which is not grossly negligent or willfully malfeasant,
(ii) any action or inaction in good faith arising from reliance upon the opinion
or advice as to legal matters of legal counsel or as to accounting matters of
accountants selected by any of them with reasonable care, or (iii) any action or
inaction in good faith of any agent, contractor or consultant selected by any of
them with reasonable care. In the event of a Covered Person's bad faith, gross
negligence or willful malfeasance in connection with any action taken or
inaction in good faith with respect to the Company which is not a violation of
the material provisions of this Agreement, such Covered Person shall only be
liable to the extent of such bad faith, gross negligence or willful malfeasance.
(h) Expenses. The Company shall pay the reasonable, documented
out-of-pocket expenses (including reasonable travel and lodging) incurred by
each member (and each alternate member) of the Board in connection with
attending each meeting of the Board, any Subsidiary Board or any Committee
attended by such member (and alternate) and other expenses reasonably incurred
in connection with the discharge of such members' duties as a member of the
Board, any Subsidiary Board or Committee.
SECTION 3. BOARD AND SECURITYHOLDER ACTIONS.
(a) Required Approvals. The approval of each of the Key Matters listed in
this Section 3 ("Required Approvals") shall be submitted to the Board for
authorization and approval; provided, however, that the Board approval shall
also require the affirmative vote of at least 1 (one) Nexus Director with regard
to Nexus Key Matters and, except as set forth in Sections 3(e) and 3(g), 1 (one)
Grupo VAC Director with regard to Grupo VAC Key Matters. In addition, (i) each
Nexus Key Matter shall require the approval of Nexus, solely in its capacity as
a Shareholder (and without any fiduciary duty to the Company or any of the
Shareholders) and (ii) except as set forth in Sections 3(e) and 3(g) below, each
Grupo VAC Matter shall require the approval of the Grupo VAC Representative
acting on behalf of all of the Grupo VAC Investors, solely in his capacity as
the Grupo VAC Representative (and without any fiduciary duty to the Company or
any of the Shareholders, including any Grupo VAC Investor). The Company shall
take (or cause to be taken) all necessary actions so that any Nexus Key Matter
or Grupo VAC Key Matter which is submitted to the Shareholders for approval (in
lieu of approval by the Board) shall also be subject to the approval
10
of Nexus or the Grupo VAC Representative (on behalf of the Grupo VAC Investors),
as applicable. Any approval rights of Nexus in its capacity as a Shareholder
under this Section 3(a) may also be exercised in writing by Bank of America on
behalf of Nexus.
(b) Nexus Key Matters. The following subject-matters shall each be
considered a "Nexus Key Matter" requiring special approval thereof as set forth
in Section 3(a):
(i) the issuance of any Equity Securities of the Company or any of its
subsidiaries other than 28,368,087 shares (as adjusted for stock splits,
stock dividends, recapitalizations and similar events) issued pursuant to
existing stock options and management incentive plans of the Company shown
on the Company's records (as of the date of the approval of these Bylaws by
the Company's shareholders) as reserved for future issuance pursuant to
such stock options and existing management incentive plans;
(ii) the declaration, setting aside or payment of any dividends on, or
making any other distributions in respect of, any of its capital stock,
other than dividends and distributions by a direct or indirect wholly-owned
subsidiary of the Company to its parent;
(iii) the purchase, redemption or other acquisition of any Equity
Securities of the Company or any of its subsidiaries or reduction in
capital of any Shares or any securities of the Company's subsidiaries;
(iv) the entering into by the Company or any of its subsidiaries of
any new line of business;
(v) the manner in which the shares or other interests of any
subsidiary or entity owned by the Company shall be voted at shareholders'
or equivalent meetings of any such subsidiary or entity with respect to any
matter of the type covered by this Section 3;
(vi) any amendments, modifications, waivers or changes to or
terminations of (A) any of the concessions/licenses granted by the Mexican
authorities to conduct the main business of the Company, (B) the Company
Bylaws, (C) any of the following, in each case as in effect on the date
hereof, (1) any employment, consulting, confidentiality or non-competition
agreement between the Company (or any of its subsidiaries) and any officer
or key employee of the Company (or any of its subsidiaries), (2) any Grupo
VAC Agreement, (3) this Agreement (including, without limitation, the
Company Guidelines attached hereto as Exhibit B), (4) the Security Trust
Agreement, or (5) the CPO Investment Trust Agreement, (D) any other
instruments or agreements to which the Company is a party entered into as
of or after the date hereof which were submitted for approval pursuant to
Section 3(a), or (E) any other agreements to which the Company is a party
entered into after the date of approval of the Company Bylaws by the
Securityholders, the amendment of which would require approval under
Section 3(a) if such agreement were in effect on the date hereof;
(vii) the subdivision or combination in any way of the outstanding
Shares of 1 (one) class or series of Shares of the Company or any of its
subsidiaries, unless the outstanding Shares of the other class or series of
Shares of the Company or its subsidiary, as applicable, shall also be
proportionately subdivided or combined in a similar manner;
11
(viii) except as provided in Section 5(j), granting to any Person the
right to request the Company to register any Shares; provided, however,
that the Company may grant rights to other Persons to participate in
piggyback registrations so long as such rights are subordinate in all
respects to the rights of Investors set forth herein;
(ix) any commitment or agreement to do any of the foregoing; and
(x) any of the matters set forth in Section 3(d) below.
(c) Grupo VAC Key Matters. Subject to and conditioned upon compliance by
the Grupo VAC Investors and their respective Affiliates with the conditions set
forth in Section 5(m), the following subject-matters shall each be considered a
"Grupo VAC Key Matter" requiring special approval thereof as set forth in
Section 3(a):
(i) the issuance of any Equity Securities of the Company or any of its
subsidiaries for a per share price below US$0.3957 (as adjusted for stock
splits, stock dividends, recapitalizations and similar events) other than
(A) issuances of up to 28,368,087 shares (as adjusted for stock splits,
stock dividends, recapitalizations and similar events) pursuant to existing
stock options and management incentive plans of the Company shown on the
Company's records (as of the date of the approval of these Bylaws by the
Shareholders) as being reserved for future issuance pursuant to such stock
options and existing management incentive plans and (B) issuances of Equity
Securities as consideration for the acquisition of the assets or capital
stock of 1 (one) or more companies;
(ii) any amendments, modifications, waivers or changes to or
terminations to (A) any of the concessions/licenses granted by the Mexican
authorities to conduct the main business of the Company, (B) the Company
Bylaws (but only to the extent such amendment is an amendment (1) to the
definition of Grupo VAC Threshold Percentage, (2) to Section 11(a), 11(c)
and/or 11(d) of the Company Bylaws or (3) that is otherwise material and
adverse to the rights of the Grupo VAC Investors under these Bylaws), or
(C) any of the Grupo VAC Agreements which would have a material adverse
effect on the rights of the Grupo VAC Investors thereunder;
(iii) any commitment or agreement to do any of the foregoing; and
(iv) any of the matters set forth in Section 3(d) below.
(d) Nexus and Grupo VAC Key Matters. The following subject-matters shall
each be considered as both a Nexus Key Matter and, subject to and conditioned
upon compliance by the Grupo VAC Investors and their respective Affiliates with
the conditions set forth in Section5(m), a Grupo VAC Key Matter requiring
special approval thereof as set forth in Section 3(a):
(i) any assignment by the Company or any of its subsidiaries for the
benefit of creditors or the voluntary commencement of any proceeding
relating to the Company or any of its subsidiaries under any bankruptcy,
reorganization, insolvency, suspension of payments, dissolution or
liquidation law of any jurisdiction;
12
(ii) the entering into by the Company or any of its subsidiaries, or
amendment of the material terms of, any transaction or series of related
transactions with any of the Company's officers, directors, employees,
bondholders, shareholders, or any of their respective Affiliates or any
individual related by blood or marriage to any such Person or any Person in
which any such Person owns a beneficial interest or any Affiliate of any of
the foregoing (collectively, "Restricted Persons"), other than any such
transaction or series of related transactions involving (A) the issuance of
debt or equity securities in which the Grupo VAC Investors are given a
pre-emptive participation right to purchase their pro rata share of any
such securities, (B) U.S. $1,000,000 (one million U.S. dollars) or less in
the aggregate over the term of such transaction(s), or (C) customary
banking relationships, in the case of this clause (C) and clause (B) above,
entered into in the ordinary course of business on an arm's length basis
and on terms no less favorable than those available from a third party (in
each case as determined by a Nexus Director);
(iii) the election, appointment or removal of any of the following key
executives of the Company or any of its subsidiaries: the Chief Executive
Officer, the General Managers of any business units, the Chief Operating
Officer, the Chief Financial Officer, the Director of Marketing or the
Chief Engineer, or any other individual with a similar or more senior title
or position, and the approval of salary, compensation and benefit or other
similar plans for such key executives;
(iv) the approval of the Company's and its subsidiaries' annual
business plan and annual budget for each fiscal year (as approved,
including any amendments or modifications thereto permitted by the Company
Bylaws, the "Approved Plan"); the approval of any amendment to,
modification of or expenditures in excess of such Approved Plan; and the
approval to enter into any material transaction outside of the ordinary
course of business and not contemplated in any Approved Plan; provided,
however, that if the annual business plan and budget are not approved by
the Board in accordance herewith then the annual business plan and budget
for the immediately preceding year shall be the Approved Plan;
(v) the entering into or amendment of any agreement which would (under
any circumstance) restrict the Company's or any of its subsidiaries' right
or ability to perform the provisions of the Company Bylaws or any
agreements or instruments to which it is a party together with its
Securityholders or to conduct its business as currently conducted or as
proposed to be conducted at any time;
(vi) the incurrence or assumption by the Company and/or any of its
subsidiaries of any indebtedness (including capitalized lease obligations)
or other liabilities (other than trade payables incurred in the ordinary
course of business which are not past due), and the mortgaging, pledging or
incurring of a lien, encumbrance or other restriction on any of the assets
or properties of the Company and/or any of its subsidiaries exceeding U.S.
$10,000,000 (ten million U.S. dollars) in the aggregate at any time then
outstanding or the amendment of any loan agreement, credit agreement,
debenture or related document in connection with any indebtedness
(including capitalized leases) approved pursuant to this Section 3;
13
(vii) subject to the limitations set forth in Section 3(e), the
Transfer or other disposal of all or a significant portion of the assets or
Equity Securities of the Company or any of its subsidiaries (including, but
not limited to, any Shares held by the Company as treasury shares) by the
Company or any of its subsidiaries in any form of transaction, or the
merger, consolidation, spin-off, recapitalization, reorganization
(including a change in the legal nature of the Company or any of its
subsidiaries), dissolution or liquidation of the Company or any of its
subsidiaries;
(viii) the establishment by the Company or any of its subsidiaries of
any subsidiary or the issuance by the Company or any of its subsidiaries of
any loans or advances to, guarantees for the benefit of, or investments in,
any Person other than a wholly-owned subsidiary (other than advance
payments made to suppliers in the ordinary course of business not exceeding
an aggregate of U.S. $2,000,000 (two million U.S. dollars) outstanding at
any time);
(ix) any redemption of Shares by the Company, other than a pro-rata
redemption of Shares (without regard to class or series of Shares) held by
all of the Securityholders; and
(x) any commitment or agreement to do any of the foregoing.
For purposes of clarification, (A) the elimination of the above matters as Grupo
VAC Key Matters shall not affect the designation of such matters as Nexus Key
Matters and (B) the right described in Section 3(d)(ix) above is in addition to
the Nexus Key Matter right described in Section 3(b)(ii).
(e) Grupo VAC Voting Limitations. Notwithstanding anything to the contrary
contained herein, neither the Grupo VAC Investors, the Grupo VAC Representative
nor the Grupo VAC Director shall have any rights pursuant to this Section 3 to
approve (i) any Qualified Public Offering (or any transactions undertaken in
connection with such a Qualified Public Offering), (ii) a Sale of the Company,
(iii) a Drag-Along Sale, (iv) subject to the Grupo VAC Investors' right of first
offer set forth in Section 5(g), any divesture by the BA Investors of all of
their beneficial and record ownership of Shares to any Person (or related
Persons), or (v) any action or decision by the Company under or with respect to
the Grupo VAC Agreements (e.g., the delivery of a notice or claim under the
Holdback Trust Agreement). In connection with any of the matters described in
clauses (i) through (v) of the preceding sentence, the Grupo VAC Investors and
their Permitted Transferees shall vote, and shall cause the Grupo VAC Director
to vote all of the Shares beneficially owned or owned of record by the Grupo VAC
and its Permitted Transferees in the same manner as the BA Investors vote their
Shares (and shall cause the Grupo VAC Director to vote such Shares in the same
way that the Nexus Director votes its Shares).
(f) Additional Approvals. The Required Approvals set forth in this Section
3 are in addition to and shall in no way limit or otherwise affect the
obligation of the Company to also (i) submit to the Board for approval other
matters which are required to be submitted to the Board for approval by
applicable law or the Company Bylaws or this Agreement or (ii) obtain any
additional approvals which may be required by applicable law, the Company Bylaws
or this Agreement.
(g) Grupo VAC Voting Rights Termination. The Grupo VAC Representative's,
the Grupo VAC Investors', and the Grupo VAC Director's rights under this Section
3 shall terminate upon the earliest to occur of (A) the consummation of a Sale
of the Company, (B) the consummation
14
of a Qualified Public Offering, (C) the percentage of the outstanding Shares
owned beneficially or of record by the Grupo VAC Investors becomes less than the
Grupo VAC Threshold Percentage and (D) the failure of the Grupo VAC Investors
and their respective Affiliates to comply with Section 5(m).
SECTION 4. COVENANTS.
(a) Financial Statements and Other Information. To the extent required in
writing, and subject in the case of the Grupo VAC Investors to their compliance
with Section 5(m), the Company shall deliver to each Investor and each Member of
the Board:
(i) at least 30 (thirty) days, but not more than 90 (ninety) days,
prior to the beginning of each fiscal year, a strategic business plan and
budget, prepared on a monthly basis for the Company and its subsidiaries
for such fiscal year (displaying anticipated statements of income, cash
flows and balance sheets) and including investment requirements,
assessments of the market, and 3-year financial projections;
(ii) (A) promptly upon preparation thereof any significant budgets
prepared by the Company and any revisions of the Approved Plan or other
budgets; (B) within 20 (twenty) days after any monthly period, a report
comparing actual performance against that month's budgetary projections
contained in the Approved Plan and containing information and data
reasonably requested by the Investors; and (C) within 20 (twenty) days
after any monthly period in which there is a material adverse deviation
from the Approved Plan, an officer's certificate explaining the deviation
and what actions the Company has taken and proposes to take with respect
thereto;
(iii) as soon as available but not more than 30 (thirty) days after
the end of each quarterly accounting period in each fiscal year, unaudited
consolidating and consolidated statements of income and cash flows of the
Company and its subsidiaries for such quarterly period and for the period
from the beginning of the fiscal year to the end of such quarter, and
unaudited consolidating and consolidated balance sheets of the Company and
its subsidiaries as of the end of such quarterly period, setting forth in
each case comparisons to the Approved Plan and to the corresponding period
in the preceding fiscal year, and all such statements shall be prepared in
accordance with Mexican generally accepted accounting principles and shall
be certified by an officer of the Company;
(iv) (A) accompanying the financial statements referred to in Section
4(a)(iii), an officer's certificate stating that (1) there is no material,
continuing breach by the Company or, to the best knowledge of the Company,
by any Securityholder under this Agreement and that neither the Company nor
any of its subsidiaries is in default under any of its other material
agreements, the concession/license granted by the Mexican government to
conduct the Business or the Guidelines and (2) the Company and its
Subsidiaries have fully complied with the laws referenced in this Section
4(a) and Section 4(b), including the United States Foreign Corrupt
Practices Act (the "FCPA"), and/or (B) promptly (but, in any event, within
five business days) after the discovery or receipt of notice of any
material, continuing breach by the Company or, to the best knowledge of the
Company, by any Securityholder under this Agreement, any noncompliance with
the FCPA, any default under any material agreement to which it or any of
its subsidiaries is a party which is not cured within 5 (five) days, any
15
condition or event which is reasonably likely to result in any material
liability under any federal, state or local statute or regulation relating
to public health and safety, worker health and safety or pollution or
protection of the environment or any other material adverse change, event
or circumstance affecting the Company or any subsidiary (including, without
limitation, the filing of any material litigation against the Company or
any subsidiary or the existence of any dispute with any Person which
involves a reasonable likelihood of such litigation being commenced), an
officer's certificate specifying the nature and period of existence
thereof, and what actions the Company and its subsidiaries have taken and
propose to take with respect thereto;
(v) within 90 (ninety) days after the end of each fiscal year (with
respect to financial statements prepared in accordance with Mexican
generally accepted accounting principles) and 120 (one hundred and twenty)
days after the end of each fiscal year (with respect to United States
generally accepted accounting principles), consolidating and consolidated
statements of income and cash flows of the Company and its subsidiaries for
such fiscal year, and consolidating and consolidated balance sheets of the
Company and its subsidiaries as of the end of such fiscal year, setting
forth in each case comparisons to the Approved Plan and to the preceding
fiscal year, all prepared in accordance with both Mexican and United States
generally accepted accounting principles (together with a reconciliation
thereof) and accompanied by (A) with respect to the consolidated portions
of such statements, an opinion of PricewaterhouseCoopers S.C. (Mexico) or
another independent accounting firm acceptable to Nexus, which opinion
contains no qualifications that relate to limitations on the scope of the
audit, an adverse condition with respect to the Company, or an adverse act
by the Company, excluding currency devaluations, force majeure events and
acts of god, (B) a certificate from such accounting firm, addressed to the
Board, stating that in the course of its examination nothing came to its
attention that caused it to believe that there was a default by the Company
or any subsidiary in the fulfillment of or compliance with any of the
terms, covenants, provisions or conditions of any material agreement to
which the Company or any subsidiary is a party or, if such accountants have
reason to believe any such default by the Company or any subsidiary exists,
a certificate specifying the nature and period of existence thereof, and
(C) a copy of such firm's annual management letter to the Board;
(vi) promptly upon receipt thereof, any additional reports, management
letters or other detailed information concerning significant aspects of the
Company's operations or financial affairs given to the Company by its
independent accountants (and not otherwise contained in other materials
provided hereunder);
(vii) within 10 (ten) days after transmission thereof, copies (in
English) of all financial statements, proxy statements, reports and any
other general written communications which the Company sends to its
shareholders and copies of all registration statements and all regular,
special or periodic reports (other than those related solely to routine
technical matters) which it files, or any of its officers or directors
file, with respect to the Company, with the Bureau, the National Banking
and Securities Commission and the Ministry of Communications and
Transportation or the U.S. Securities and Exchange Commission or with any
securities exchange on which any of its securities are then listed, and
copies of all press releases and other statements made available generally
by the
16
Company to the public concerning material developments in the Company's and
its subsidiaries' businesses; and
(viii) with reasonable promptness, such other information and
financial data concerning the Company and its subsidiaries as any Person
entitled to receive information under this Section 4(a) may reasonably
request in connection with the monitoring of their investment in the
Company or their activities as a member of the Board.
Each of the financial statements referred to in Sections 4(a)(iii) and
4(a)(v) shall be true and correct in all material respects as of the dates and
for the periods stated therein, subject in the case of the unaudited financial
statements to changes resulting from normal year-end adjustments for recurring
accruals (none of which would, alone or in the aggregate, be materially adverse
to the condition (financial or otherwise), operating results, assets, operations
or business prospects of the Company and its subsidiaries taken as a whole).
The Grupo VAC Investor's rights under this Section 4 are subject to and
conditioned upon compliance by the Grupo VAC Investors and their respective
Affiliates with the conditions set forth in Section 5(m).
All financial statements and other deliveries required under this Section
4(a) shall be expressed in both U.S. dollars and Mexican pesos (or the then
current Mexican currency).
(b) Compliance with U.S. Foreign Corrupt Practices Act. The Company shall,
and shall cause each of its subsidiaries to at all times cause to be done all
things necessary to, comply with (and, upon the request of Nexus from time to
time, provide evidence to the Investors of the Company's and its subsidiaries'
compliance with) the U.S. Foreign Corrupt Practices Act.
(c) Inspection of Property. The Company shall permit any representative
designated by a member of the Board at such times as any such Person may
reasonably request during regular business hours after prior written notice of
at least 2 (two) business days to (i) visit and inspect any of the properties of
the Company and its subsidiaries, (ii) examine and copy the corporate and
financial records of the Company and its subsidiaries, and (iii) discuss the
affairs, finances and accounts of the Company and its subsidiaries with the
directors, officers, key employees and independent accountants of the Company
and its subsidiaries.
(d) Confidentiality. Each Securityholder agrees that it shall use its
reasonable efforts to, and shall use its reasonable efforts to cause its
respective directors, officers, employees, former employees, advisors and
Affiliates to, keep confidential any information or materials which (i) pertain
to the Company or its subsidiaries or their respective businesses or (ii)
pertain to matters designated as proprietary and confidential by the Company
(collectively, "Confidential Information"); provided, however, that (A) any
Confidential Information required by law, regulators or legal or administrative
process to be disclosed may be disclosed without violating the provisions of
this Section 4(d), (B) the Securityholders may disclose Confidential Information
to their respective directors, officers, employees, former employees, advisors,
investors, equity owners and Affiliates ("Affiliated Parties") and their
respective Affiliated Parties if the disclosing party believes that such
disclosure is necessary or desirable in connection with the monitoring of such
Securityholders investment in the Company; provided, however, that such
Affiliated Party must comply with the terms and provisions of this Section 4(d)
as if they were named as a party for
17
purposes hereto in lieu of the Securityholder, (C) the Securityholders (or any
of their Affiliated Parties and their respective Affiliated Parties) may
disclose Confidential Information in connection with the Transfer of any portion
of Shares so long as such Person's transferee agrees in writing to be bound by
the provisions hereof; provided, however, that such sale or transfer does not
violate any provisions of this Agreement, and (D) this Section 4(d) shall not
prohibit the Securityholders from disclosing any Confidential Information that
is available to the public on the date hereof, or which thereafter becomes
available to the public other than as a result of a breach of this Section 4(d);
provided, however, that such Confidential Information may not be disclosed until
it has, in fact, become available to the public other than as a result of a
disclosure by the Securityholders or its Affiliated Party in violation of this
agreement. Each of the Securityholders agrees and acknowledges that Confidential
Information constitutes "industrial secrets" within the meaning of the Mexican
Intellectual Property Law and is entitled to all of the protections afforded the
Company by such law.
(e) UBTI. Notwithstanding any provision of this Agreement to the contrary
the Company shall not undertake any activity, operate any trade or business, or
take any action, including without limitation the borrowing of money or the
incurring of any other indebtedness, obligation, or liability, that would cause
any Securityholder, any partner of any Securityholder, or any Person owning,
directly or indirectly, any interest in a Securityholder or the Company, whose
income is exempt from United States federal income tax (each, an "Affected
Person"), to have or incur any unrelated business taxable income (as defined in
Sections 511 through 514 of the United States Internal Revenue Code) on account
of such activity or action without the express prior written consent of each
Securityholder who is (or is acting on behalf of) an Affected Person, which
consent may be granted, withheld or conditioned in such Securityholder's
respective sole and absolute discretion.
(f) Shareholders Meetings. Any Shareholders meeting shall be called and
conducted in compliance with the applicable provisions of the Company's Bylaws.
SECTION 5. RESTRICTIONS ON TRANSFER OF SHARES.
(a) Transfer of Shares. No Securityholder shall Transfer any Shares (or any
interest therein) or Options (or any interest therein) except pursuant to the
provisions of this Section 5. Any Transfer in violation of this Section 5 shall
be null and void ab initio and shall not be consented to, recognized or
registered by the Company for any purpose.
(b) Restricted Shares. Except for Transfers to (i) Permitted Transferees,
(ii) pursuant to a Sale of the Company or (iii) of Shares registered in a Public
Offering (collectively, the Exempt Transfers), no Securityholder shall Transfer
any Series A Shares or Series B Shares (the "Restricted Shares"), without the
prior written approval of Nexus, solely in its capacity as a Securityholder (and
without any fiduciary duty to the Company or any of the Company's
Securityholders) which consent may be withheld for any reason or no reason (the
"Restricted Share Transfer Consent"). If the Restricted Share Transfer Consent
is obtained with respect to a proposed Transfer, the transferring holder of such
Restricted Shares shall also comply with the requirements of Sections 5(c) (if a
Non-Investor), 5(d) (if an Investor), 5(e), 5(f) and 5(g).
18
(c) Rights of First Refusal on Transfers by Non-Investors. Except for an
Exempt Transfer, at least 30 (thirty) days prior to any Transfer of any Shares
by any Securityholder other than an Investor (the "Transferring Non-Investor
Securityholders"):
(i) Such Securityholder shall deliver written notice thereof (the
"Offer Notice") to the Secretary of the Board who shall then promptly
deliver such Offer Notice (but in any event within 5 (five) days) to each
of the other Securityholders (other than the CPO Trustee) (the "Non-CPO
Securityholders"), at the registered addresses of such Securityholders on
file with the Company, disclosing the number of Shares to be Transferred,
the proposed price, terms and conditions of the Transfer and the identity
of the prospective transferee(s) who would acquire such Shares (if known at
such time).
(ii) The Non-CPO Securityholders may elect to purchase all (but not
less than all) of the Shares to be Transferred on the same terms and
conditions as those set forth in the Offer Notice. Each Non-CPO
Securityholder desiring to participate shall give written notice within 30
(thirty) days after the Offer Notice has been given to the Secretary of the
Board to the Transferring Non-Investor Securityholder of the maximum number
of Shares that such Non-CPO Securityholder desires to purchase. If the
Non-CPO Securityholders elect to purchase all such Shares thereunder, the
Transfer of such Shares shall be consummated as soon as possible after the
delivery of the purchase election notice(s) to the transferring Investor,
but in no event later than 15 (fifteen) days after the expiration of such
30-day right of first refusal election period. If the aggregate number of
Shares desired to be purchased by participating Non-CPO Securityholders
exceeds the number of Shares to be Transferred pursuant to the Offer
Notice, each Non-CPO Securityholders shall be entitled to purchase a pro
rata number of Shares based on the Shares held by each such participating
Non-CPO Securityholder.
(iii) If, within 30 (thirty) days after the delivery of the Offer
Notice, the Non-CPO Securityholders have not elected to purchase all of the
Shares specified in the Offer Notice, the Transferring Non-Investor
Securityholders may Transfer the Shares specified in the Offer Notice to
the transferee(s) specified in the Offer Notice at a price and on terms no
more favorable to the transferee(s) than are specified in the Offer Notice
for a period of no more than 90 (ninety) days after the 30th day after
delivery of the Offer Notice (the "RFR Free Transfer Period"). Any Shares
not Transferred within such 90-day period shall remain subject to the
provisions of this Section 5(c).
(iv) If an electing Securityholder is not permitted under applicable
Mexican law to hold the amount or type of Shares which such electing
Securityholder would be otherwise entitled to purchase upon the exercise of
its rights under this Section 5(c) (e.g. because such Securityholder is not
Mexican), then such electing Securityholder may designate another purchaser
who is qualified under Mexican law to purchase such Shares or, at its
election, such electing Securityholder may request the Company to agree (to
the extent permitted under Mexican law) to exchange such Shares to be
purchased by such electing Securityholder (pursuant to the exercise of its
rights under this Section 5(c)) for other securities of the Company which
such Securityholder is permitted to purchase and which have identical
rights as such Shares being transferred; provided, however, that, in order
to
19
comply with applicable law, the voting rights of such securities may be
limited to the minimum level necessary to effect such compliance.
(d) Right of First Offer on Transfers by Investors (other than BA
Investors).
(i) Except for an Exempt Transfer or a Transfer to a Grupo VAC
Investor pursuant to its exercise of rights under Section 5(g), if any
Investor other than a BA Investor desires to transfer any Shares, such
Investor shall deliver written notice thereof (the "Investor Transfer
Notice") to the Secretary of the Board who shall, within 3 (three) business
days, deliver a copy thereof to each Investor holding at least 1% of the
Shares then outstanding (a "Qualified Investor"), at the registered
addresses of such Qualified Investor on file with the Company, disclosing
the type and number of Shares sought to be transferred, the proposed price
of the Transfer and other material economic terms of the proposed Transfer.
(ii) The Qualified Investors may elect to purchase all (but not less
than all) such Shares to be Transferred on a pro rata basis (determined on
the basis of number of Shares held by each such Qualified Investor) and at
the same price specified in the Investor Transfer Notice. Each Qualified
Investor desiring to participate shall give written notice to such
transferring Investor within 30 (thirty) days after the Investor Transfer
Notice has been given to the Secretary of the Board of the maximum number
of Shares that such Qualified Investor desires to purchase. If the
Qualified Investors elect to purchase all such Shares thereunder, the
Transfer of such Shares shall be consummated as soon as possible after the
delivery of the purchase election notice(s) to the transferring Investor,
but in no event later than 30 (thirty) days after delivery of the
applicable purchase election notice. If the aggregate number of Shares
required to be purchased by participating Qualified Investors exceeds the
number of Shares to be Transferred pursuant to the Investor Transfer
Notice, each Qualified Investor shall be entitled to purchase a pro rata
number of Shares based on the Shares held by each such participating
Qualified Investor.
(iii) If the electing Qualified Investors have not elected to purchase
all of the Shares specified in the Investor Transfer Notice, the
transferring Investor may, for a period (the "ROFO Free Transfer Period")
of 180 days after the expiration of such period, Transfer the Shares
specified in the Investor Transfer Notice to 1 (one) or more parties at a
price and on other material economic terms no more favorable to the
transferees thereof than as set forth in the Investor Transfer Notice. Any
such Shares specified in the Investor Transfer Notice that are not
transferred within such 180-day period shall remain subject to the
provisions of this Section 5(d).
(iv) If an electing Qualified Investor is not permitted under
applicable Mexican law to hold the amount or type of Shares to which such
electing Qualified Investor would be otherwise entitled to purchase upon
the exercise of its rights under this Section 5(d), then such electing
Qualified Investor may designate another purchaser who is qualified under
Mexican law to purchase such Shares or, at its election, such electing
Qualified Investor may request the Company to agree (to the extent
permitted under Mexican law) to exchange such Shares to be purchased by
such electing Qualified Investor (pursuant to the exercise of its rights
under this Section 5(d)) for other securities of the Company which such
Qualified
20
Investor is permitted to hold and which have identical rights as those
being Transferred; provided, however, that, in order to comply with
applicable law, the voting rights of such securities may be limited to the
minimum level necessary to effect such compliance.
(e) Participation (Tag-Along) Rights in Transfers.
(i) If a Securityholder desires to Transfer any Shares (a
"Transferring Securityholder") other than pursuant to an Exempt Transfer,
which shall be governed by Sections 5(f), 5(h), 5(i), 5(j) and 5(l) as
applicable, such Securityholder shall deliver written notice thereof (the
"Tag-Along Right Notice") to the Secretary of the Board, and the Secretary
of the Board shall then promptly (but in any event within 5 (five) days or,
to the extent necessary to comply with requirements of applicable law, such
longer period as reasonably determined by the Board (including the approval
of at least 1 (one) Nexus Director)) deliver to the other Securityholders
(other than the CPO Trustee unless such Transfer constitutes a Sale of the
Company, in which case the CPO Trustee shall be entitled to receive notice
of and participate in such Transfer), at the registered addresses of such
Securityholders on file with the Company, such Tag-Along Right Notice
(which notice may be given simultaneously with any notice required to be
delivered pursuant to Sections 5(c), 5(d), and 5(g) above), disclosing the
number of Shares to be Transferred, the proposed price, terms and
conditions of the Transfer (including, without limitation, a description of
any expense, escrow, holdback, earn-out, indemnity or similar obligations
to which the participating Securityholders shall be responsible), the
identity of the prospective transferee(s) (if known at such time) and
whether such Securityholder's participation right is subject to adjustment
as a result of Sections 5(c), 5(d) or 5(g) (i.e., the tag-along rights
shall only apply to the Shares that the Transferring Securityholder is
entitled to Transfer after first complying with the requirements of Section
5(c), 5(d), or 5(g), as applicable).
(ii) All eligible Securityholders (other than the CPO Trustee unless
such Transfer constitutes a Sale of the Company) may elect to participate
on a pro rata basis (based on the number of Shares) in the contemplated
Transfer described in the Tag-Along Right Notice by giving written notice
to the Transferring Securityholder within the longer of (i) 20 (twenty)
days after delivery of the Tag-Along Right Notice to the Company or (ii) 3
(three) business days after the beginning of the RFR Free Transfer Period,
if applicable (the "Tag-Along Window"). Each such Securityholder may
participate in the contemplated Transfer at the same price and, subject to
clause (vi) below, on the same terms specified in the Tag-Along Right
Notice; provided, however, that if a Securityholder holds more than 1 (one)
class or series of Shares, such Securityholder's rights under this Section
5(e) to participate in such Transfer shall be allocated proportionately
among all of the Shares owned by such Securityholder (e.g. if a Transfer
pursuant to a Tag-Along-Right Notice is contemplated, a Securityholder
holding 1,000 Series B Shares and 1,000 Series N Shares would be required
to Transfer an equal number of both Series B and Series N Shares). The
failure to deliver notice electing to participate within a Tag-Along Window
shall be deemed an automatic and complete waiver of all rights to
participate in such Transfer pursuant to this Section 5(e). In connection
with any Transfer, each Securityholder's participation rights therein (with
respect to the absolute number of Shares) is subject to adjustment as a
result of Sections 5(c), 5(d), and 5(g) (i.e., the tag-along rights shall
only apply to the Shares that the Transferring
21
Securityholder is entitled to Transfer after first complying with the
requirements of Sections 5(c), 5(d), and 5(g)).
(iii) If no Securityholder elects to participate in the contemplated
Transfer (either by giving notice to such effect or failing to give notice
within the Tag-Along Window), then, pursuant to and on the terms
substantially as described in the Tag-Along Right Notice, the Transferring
Securityholder may Transfer such Shares to the Person(s) specified in the
Tag-Along Right Notice for a period equal to (A) the remaining RFR Free
Transfer Period, if applicable, (B) the remaining ROFO Free Transfer
Period, if applicable, (C) 180 days after the expiration of the Tag-Along
Window if the proposed Transfer described in the Tag-Along Notice is
pursuant to Section 5(g) or (D) 120 days after the expiration of the
Tag-Along Window if the proposed Transfer of Shares described in the
Tag-Along Notice was not subject to Sections 5(c), 5(d), or 5(g); provided,
however, that there will be an automatic 60-day extension of such 120-day
period to the extent that regulatory approvals for a Transfer have not been
obtained within such original 120-day period. If the Transferring
Securityholder fails to Transfer such Shares described in the Tag-Along
Notice within such applicable period, the Transferring Securityholder shall
not Transfer such Shares without again complying with the provisions of
this Section 5(e).
(iv) No Transferring Securityholder shall Transfer any of its Shares
to any prospective transferee if such prospective transferee declines to
allow the participation of the other Securityholders on the terms provided
in this Section 5(e), unless and only to the extent that the prospective
transferee may not hold such other Securityholder's Shares because of
ownership restrictions on such Shares imposed by this Agreement or
applicable Mexican law.
(v) The rights of Securityholders to participate in a Transfer as set
forth in this Section 5(e) are subject to the satisfaction of the following
conditions: (A) each participating Securityholder will only be required to
make affirmative representations and warranties only as to (1) due power
and authority to enter into the agreement and transactions contemplated
thereby, (2) non-contravention of any agreement to which it is a party or
by which it is bound, and (3) good and valid title to the equity securities
to be transferred (or, in the case of beneficial ownership of the Shares
through a trust, good and valid title to the certificates of participation
in such trust), free and clear of any and all liens, claims, pledges,
options and restrictions of any kind whatsoever (other than as contemplated
hereby and by this Agreement), (B) the participating Securityholders shall
be severally obligated to share, on a pro rata basis (based on such
Securityholder's share of the aggregate proceeds paid with respect to the
Shares sold in such transaction), any expense, escrow, holdback, earn-out,
indemnity or similar obligation that the Transferring Securityholder has
agreed to in connection with such Transfer (but, with respect to each
participating Securityholder, not in excess of the consideration such
Securityholder is entitled to receive in connection with its participation
in the transaction), and with respect to any contingent post-closing
indemnity or other obligations, any proceeds a Securityholder is entitled
to receive in connection with its participation pursuant to this Section
5(e) in a Transfer shall be subject to a holdback obligation unless such
Securityholder provides such purchaser with assurances and/or collateral,
in form and substance satisfactory to such purchaser, as such purchaser may
require; provided, however, that any assurances or collateral provided by
the Transferring
22
Securityholder and/or the other participating Securityholders may differ
from Securityholder to Securityholder (it being understood and permitted,
that certain Securityholders (including, without limitation, the BA
Investors and/or the Grupo VAC Investors) may only be required to sign an
agreement or indemnity without any holdback obligations), and (C) if the
purchaser of the Shares requires the Transferring Securityholder and the
other participating Securityholders to execute any ancillary purchase or
other agreements, each participating Securityholder shall be required, as a
condition to its participation rights in such Transfer, to execute all such
agreements, subject to the requirements set forth in the preceding
sentence; provided, however, that in no event shall any Securityholder be
required to execute a non-competition or non-solicitation agreement.
(vi) To the extent that a Securityholder holds Shares subject to
restrictions on ownership pursuant to this Agreement or applicable Mexican
law (e.g., Series A Shares may only be owned by Mexicans), such
Securityholder will only be eligible to Transfer such restricted Shares
pursuant to this Section 5(e) to purchasers who are eligible to own such
restricted Shares.
(vii) The CPO Trustee is not entitled to participate pursuant to the
tag-along rights in this Section 5(e) in any Transfer other than a Transfer
that constitutes a Sale of the Company.
(viii) The tag-along rights in this Section 5(e) shall not apply to a
Drag-Along Sale.
(f) Drag Along Rights.
(i) If, at any time or from time to time, Nexus and/or Bank of America
desires that Maxcom and its Securityholders approve and consummate a Sale
of the Company (and regardless of the percentage of outstanding Shares then
owned or proposed to be sold by the BA Investors in such Sale of the
Company so long as the percentage of the BA Investors' Shares proposed to
be included in any such Sale of the Company is proportional to the
percentage of each other Securityholder's Shares proposed to be included in
such Sale of the Company prior to giving effect to any restrictions on
non-Mexican ownership of Shares (e.g., if the BA Investors propose to sell
51% of their Shares, each of the other Securityholders shall be required to
sell 51% of such Securityholders' Shares)), Nexus and/or Bank of America
may so elect to require Maxcom and its Securityholders to consummate and
approve the terms and conditions of a "Drag-Along Sale". In connection with
any Drag-Along Sale, (1) the Grupo VAC Investors shall have the rights of
first offer set forth in Section 5(g) and (2) regardless of whether such
Drag-Along Sale is to the Grupo VAC Investors or another purchaser:
(A) The Company shall cooperate with Nexus and Bank of America
and take all actions in connection with the consummation of the
Drag-Along Sale as requested by the Board, Nexus or Bank of America,
including, without limitation, retaining such legal and financial
advisors (including, without limitation, investment bankers, as may
deemed necessary or appropriate by Nexus and/or Bank of America
(and/or the Board) to assist the Company in structuring and
consummating such Drag-Along Sale (and, if requested by Nexus or Bank
of America, the Company and
23
such advisors shall conduct an auction of the Company by contacting
multiple prospective purchasers to consummate a Sale of the Company).
(B) At the request of Nexus and/or Bank of America, each of the
Company's Securityholders and the beneficial owners of Shares shall
(and shall cause any director on the Board designated by such
Securityholder to) vote in favor of, consent to and raise no
objections against such Drag-Along Sale and the Company and each
Securityholder (other than the CPO Trustee) and beneficial owner of
Shares shall take all other actions in connection with the
consummation of the Drag-Along Sale as requested by the Board, Nexus
or Bank of America including entering into purchase agreements,
carrying out due diligence, calling Securityholder meetings, voting in
favor, proxies, and exercising and/or terminating all options.
(C) If the Drag-Along Sale is structured as (i) a merger or
consolidation of the Company, or other transaction triggering
Securityholder rights, then each Securityholder shall waive any
dissenters' rights or similar rights in connection with such merger or
consolidation (and each optionholder shall be required to exercise or
consent to the cancellation of any of its Options in connection with
such Drag-Along Sale) or (ii) as a sale of Shares, then, in each case,
each Securityholder shall agree to sell all (or, in the case of a
Drag-Along Sale of less than all of the Shares, its pro rata share) of
its Shares and, to the extent included in a Drag-Along Sale, rights to
acquire Shares. The Company shall use its best efforts to cause each
Option, unless exercised prior to the consummation of a Drag-Along
Sale, to be cancelled immediately prior to the consummation of a
Drag-Along Sale without any additional consideration required to be
paid therefor, and in connection therewith, each Securityholder
holding any Options shall consent to such a cancellation of any
Options it holds in connection with a Drag-Along Sale (i.e., to the
extent not exercised prior to the consummation of such Drag-Along
Sale).
(D) Each beneficial owner of Shares, other than any holder of
CPOs, shall use its best efforts to cause the voting power of its
Shares to be voted for (or to consent to) a Drag-Along Sale.
(E) In connection with a Drag-Along Sale:
(i) The obligations of the Securityholders with respect to
the Drag-Along Sale are subject to the receipt by each
Securityholder of its pro rata share of the aggregate
consideration payable to all Securityholders and in-the-money
optionholders in such Drag-Along Sale.
(ii) In connection with a Drag-Along Sale, (A) each
Securityholder (including the CPO Trustee) will be required to
make affirmative representations and warranties only as to (1)
due power and authority to enter into the agreement and
transactions contemplated thereby, (2) non-contravention of any
agreement to which it is a party or by which it is bound, and (3)
good and valid title to the Shares to be Transferred, free and
clear of any and all liens, claims, pledges, options and
restrictions of any kind whatsoever (other than as set forth
herein) and (B) the Securityholders and
24
any in-the-money optionholders shall be severally obligated to
share, on a pro rata basis (based on such holder's share of the
aggregate proceeds paid with respect to the Shares and
in-the-money Options in such Drag-Along Sale) in any expense,
escrow, holdback, earn-out, indemnity or similar obligation that
Nexus or the Company has agreed to in connection with such
Drag-Along Sale (but, with respect to each participating
Securityholder and optionholder, not in excess of the
consideration such holder is entitled to receive in connection
with its participation in the Drag-Along Sale), and with respect
to any contingent post-closing indemnity or other obligations,
any proceeds a Securityholder or optionholder is entitled to
receive in connection with a Drag-Along Sale shall be subject to
a holdback obligation unless such holder provides such purchaser
with assurances and/or collateral, in form and substance
satisfactory to the purchaser in such Drag-Along Sale; provided,
however, that any assurances or collateral provided by Nexus
and/or the other participating Securityholders and optionholders
may differ from holder to holder (it being understood and
permitted that certain Securityholders (including, without
limitation, the BA Investors and/or the Grupo VAC Investors) and
optionholders may only be required to sign an agreement or
indemnity without any holdback obligations), and (C) Company and
each participating Securityholder shall cooperate with Bank of
America and Nexus and take such additional action as may be
requested by Bank of America or Nexus or as required by
applicable law. If the purchaser in a Drag-Along Sale requires
Nexus and the other participating Securityholders and
optionholders to execute any ancillary purchase or other
agreements, each such participating holder (other than with
respect to the CPO Trustee) shall be required to execute all such
agreements, subject to the requirements set forth in the
preceding sentence.
(iii) To the extent that a Securityholder holds Shares
subject to restrictions on ownership pursuant to this Agreement
or applicable Mexican law, it will only be obligated to Transfer
to purchasers who are eligible to own such restricted Shares;
provided, however, that in connection with a Drag-Along Sale, the
purchaser shall have the right to assign its right to purchase
such restricted Shares to a different purchaser who is eligible
to own such restricted Shares (for the same consideration and on
the same terms and conditions (other than as to restrictions on
ownership) as the other Shares being sold in the Drag-Along
Sale).
(g) Grupo VAC Right of First Offer on Certain Transfers and Limited Offer
Right on Certain Sale of Company Transactions.
(i) So long as (A) the Grupo VAC Investors at such time collectively
own at least the Grupo VAC Threshold Percentage of the issued and
outstanding Shares, (B) a ROFO-RLO Free Period is not then in effect, (C)
the Grupo VAC Director (and its alternate), the Grupo VAC Representative,
the Grupo VAC Investors, their respective Affiliates, and, to the extent
applicable under Section 5(g)(xi), their respective representatives and
agents, have complied (and are complying) with the Recusal
25
requirements set forth in Section 5(g)(xi) and (D) the Grupo VAC
Representative's and the Grupo VAC Investors' rights under this Section
5(g) have not been terminated pursuant to Section 5(g)(vi) or Section 5(n)
(collectively, the "Grupo VAC Offer Right Conditions"), if Nexus or Bank of
America is considering or desires to (1) Transfer all of the Shares owned
beneficially or of record by the BA Investors to any Person (or related
Persons) other than (x) to a Permitted Transferee or other Qualified
Affiliate of Bank of America or (y) a Transfer only of Shares registered in
a Public Offering, (2) Nexus or Bank of America desires to exercise its
rights under Section 5(f) to cause a Drag-Along Sale or (3) approve a sale
for cash of all or substantially all of the consolidated assets of the
Company, Nexus and/or Bank of America shall first deliver written notice of
such proposed action ("Grupo VAC ROFO Notice") to the Grupo VAC
Representative, disclosing the type and number of Shares sought to be
Transferred and other material economic terms of the proposed Transfer (or
if such transaction is a sale of all or substantially all of the
consolidated assets of the Company, a description of the material economic
terms of such proposed sale), including whether or not such proposed
Transfer (or asset sale, as applicable) is in connection with an offer from
a third-party to acquire such Shares or assets that was not solicited by
the Company, Nexus or Bank of America (an "Unsolicited Transfer").
(ii) For purposes of this Section 5(g), a "ROFO-RLO Free Period" shall
exist if the Company, Nexus and/or Bank of America delivers a Grupo VAC
ROFO Notice or a Grupo VAC RLO Notice and either (1) the Grupo VAC
Representative declines or otherwise fails to deliver a valid Grupo VAC
Offer or Grupo VAC Limited Offer, as the case may be or (2) Nexus rejects,
declines or otherwise does not accept such Grupo VAC Offer or Grupo VAC
Limited Offer; provided, however, for purposes of clarification, that the
conditions in Section 5(g)(iv) and 5(g)(v) shall continue to apply to a
rejected Grupo VAC Offer during the ROFO-RLO Free Period. The length of the
ROFO-RLO Period shall be (A) 180 days following the date of rejection of a
Grupo VAC Offer, (B) 210 days following the delivery of the Grupo VAC ROFO
Notice if the Grupo VAC Representative does not deliver a valid Grupo VAC
Offer (or otherwise fails to comply with Section 5(g)(iv)) and (C) 210 days
following the delivery of a Grupo VAC RLF Notice if (x) Bank of America,
Nexus and the BA Investors decline to accept for any reason such Grupo VAC
Limited Offer or decline to accept for any reason such Grupo VAC Limited
Offer or decline to enter into the purchase agreement related to such Grupo
VAC Limited Offer or (y) Grupo VAC does not, for any reason, deliver a
purchase offer related to such Grupo VAC Limited Offer that complies with
Section 5(g)(vii).
(iii) Upon receipt of a Grupo VAC ROFO Notice, the Grupo VAC
Representative shall be entitled to make to Bank of America, the BA
Investors and Nexus an irrevocable and binding written offer (a "Grupo VAC
Offer") on behalf of the Grupo VAC Investors to purchase for U.S. dollars
cash all (but not less than all) of the Shares (or assets, if applicable)
described in such Grupo VAC ROFO Notice; provided, however, that any such
Grupo VAC Offer must be delivered to Bank of America, the BA Investors and
Nexus (A) within 10 (ten) business days after receipt of a Grupo VAC ROFO
Notice related to any proposed Unsolicited Transfer or (B) within 30
calendar days after receipt of a Grupo VAC ROFO Notice related to all other
proposed Transfers (and all other proposed asset sales). To constitute a
valid Grupo VAC Offer, it shall include a fully executed purchase agreement
(other than the BA Investors' countersignatures) that (1) only requires
representations,
26
warranties and obligations by the BA Investors (or, if an asset sale, only
representations, warranties and obligations by the Company) consistent with
those described in Section 5(f)(ii) of this Agreement and (2) does not
include any closing conditions other than receipt of required regulatory
approvals and delivery by the BA Investors of the Shares owned by the BA
Investors ((or, if an asset sale, delivery of title to the applicable
assets), free and clear of any liens or encumbrances. Promptly following
the BA Investors' written acceptance (or, if an asset sale, the Company's
written acceptance) of a Grupo VAC Offer, the Grupo VAC Investors shall
consummate such purchase and Transfer as soon as possible, but in no event
later than 30 (thirty) calendar days (or such longer period as mutually
agreed to among the Grupo VAC Representative, Nexus and Bank of America)
after the Grupo VAC Representative's receipt of the BA Investors'
acceptance (or, if an asset sale, the Company's written acceptance) of such
Grupo VAC Offer, subject to the receipt of any required regulatory
approvals.
(iv) Following (1) the receipt of a Grupo VAC Offer if Bank of
America, Nexus or the BA Investors (or, if an asset sale, the Company)
elect not to accept such Grupo VAC Offer or (2) the expiration of the
periods set forth in Section 5(g)(iii) to make a valid Grupo VAC Offer if
Grupo VAC does not, for any reason, deliver a purchase offer that complies
with Section 5(g)(iii), then for a period of (A) 180 days after the date of
rejection of a Grupo VAC Offer by the BA Investors (or, if an asset sale,
for a period of 180 days after the date of rejection by the Company of such
Grupo VAC Offer) or (B) 210 days after the delivery of the Grupo VAC ROFO
Notice if the Grupo VAC Representative does not deliver a valid Grupo VAC
Offer (or otherwise fails to comply with Section 5(g)(iii)), the Company
(to the extent applicable), Nexus, Bank of America and the BA Investors
(or, with respect to an asset sale, the Company) may, either, at their
option (x) Transfer the BA Investors' Shares (or, if an asset sale,
transfer or sell the applicable assets) specified in the Grupo VAC ROFO
Notice to 1 (one) or more parties at a price and on other economic terms no
more favorable to such parties (taken together with the pricing as a whole)
than those offered by the Grupo VAC Representative in the Grupo VAC Offer
for such Shares (or, if an asset sale, for the applicable assets) or (y)
enter into a transaction that would otherwise require the prior delivery of
Grupo VAC RLO Notice.
(v) If a ROFO-RLO Free Period exists only as the result of the
delivery of a Grupo VAC RLO Notice in which a valid Grupo VAC Limited Offer
and purchase agreement were received from the Grupo VAC Representative in
response to such Grupo VAC RLO Notice (and Section 5(g)(vii) was otherwise
fully complied with) and such Grupo VAC Limited Offer was rejected or
otherwise declined by Bank of America, Nexus and the BA Investors, then if
Nexus or Bank of America desires to enter into a transaction that would
otherwise require the delivery of a Grupo VAC ROFO Notice under Section
5(g)(i) (a "Covered Transaction"), at the option of Nexus and Bank of
America, either (A) notwithstanding the existence of a ROFO-RFL Free
Period, deliver a Grupo VAC ROFO Notice with respect to such proposed
Covered Transaction or (B) enter into and consummate such Covered
Transaction at a per share price and on other economic terms no more
favorable the acquirer (taken together with the pricing as a whole) than
those offered by the Grupo VAC Representative in the Grupo VAC Limited
Offer (it being understood that the foregoing shall in no way require that
a Covered Transaction include 100% of the outstanding Shares of Maxcom or
that any Shareholder other than the BA Investors sell their
27
Shares). For purposes of clarification, the preceding sentence does not
modify the requirement that if a Covered Transaction is structured as a
Drag-Along Sale, the BA Investors' Shares proposed to be included in such
Drag-Along Sale will be proportional to the percentage of each other
Shareholder's Shares proposed to be included in such Drag-Along Sale.
(vi) So long as the Grupo VAC Offer Right Conditions have been
satisfied, if Nexus, Bank of America or the BA Investors is considering or
desires to enter into (directly or through the Company) a letter of intent
(or a binding agreement) with an Independent Third Party regarding a
potential merger, recapitalization, or reorganization of the Company after
which (A) at least a majority of the beneficial and record ownership of the
Shares then outstanding would be owned by such Independent Third Party and
(B) the BA Investors would continue to own, beneficially or of record,
Shares (a "Strategic Combination"), then either the Company or Nexus shall
provide the Grupo VAC Representative with at least 5 (five) business days
written notice of such intention to enter into such a letter of intent or
agreement with respect to such potential Strategic Combination ("Grupo VAC
RLO Notice"). The Grupo VAC RLO Notice shall only be required to disclose
the fact that Nexus, Bank of America, the BA Investors or the Company may
enter into a letter of intent or agreement with respect to a Strategic
Combination and, to the extent known at such time and if the disclosure of
which is not otherwise contractually restricted, the identity of the
proposed parties to the Strategic Combination and the estimated pro forma
equity ownership of the Company after giving effect to such proposed
Strategic Combination. Other than the disclosure requirements set forth in
the preceding sentence, the Grupo VAC RLO Notice shall not be required to
disclose any of the terms of any proposed Strategic Combination.
(vii) Upon receipt of a Grupo VAC RLO Notice, the Grupo VAC
Representative shall be entitled to make to Bank of America, the BA
Investors and Nexus an irrevocable and binding written offer on behalf of
the Grupo VAC Investors to purchase for U.S. dollars cash all (but not less
than all) of the Shares then outstanding (a "Grupo VAC Limited Offer").
Bank of America, Nexus and the BA Investors shall be free to accept or
reject any Grupo VAC Limited Offer, it being understood that the valuations
and terms (economic and non-economic) included in any Grupo VAC Limited
Offer shall not affect or restrict (A) the ability of the Company, Bank of
America, Nexus and the BA Investors to enter into or consummate any
Strategic Combination or (B) the terms and conditions of any Strategic
Combination that may be accepted by the Company, Nexus and/or the BA
Investors (i.e., the Company, Nexus and the BA Investors may elect to enter
into a Strategic Combination that is economically inferior to the economic
terms set forth in a Grupo VAC Limited Offer). If the Grupo VAC
Representative makes a Grupo VAC Limited Offer acceptable to Nexus, the BA
Investors and Bank of America, then the Grupo VAC Representative shall
promptly, and in any event within 5 (five) business days after notice by
either Nexus or Bank of America that the Grupo VAC Limited Offer's
valuation and terms are acceptable, deliver a fully executed purchase
agreement with respect to such Grupo VAC Limited Offer (other than the BA
Investors' countersignatures) that (1) only requires representations,
warranties and obligations by the participating Shareholders (or, if an
asset sale, only representations, warranties and obligations by the
Company) consistent with those described in Section 5(f)(ii) of this
Agreement and (2) does not include any closing conditions other than
receipt of required regulatory approvals and delivery by the Shareholders
of the Shares, free and
28
clear of any liens or encumbrances. Promptly following the BA Investors'
written acceptance of any such Grupo VAC Limited Offer purchase agreement,
the Grupo VAC Investors shall consummate such purchase and Transfer as soon
as possible, but in no event later than 30 (thirty) calendar days (or such
longer period as mutually agreed to among the Grupo VAC Representative,
Nexus and Bank of America) after the acceptance of such Grupo VAC Limited
Offer purchase agreement, subject to the receipt of any required regulatory
approvals.
(viii) Following (1) the receipt of a Grupo VAC Limited Offer if the
BA Investors elect not to accept such Grupo VAC Limited Offer or (2) the
expiration of the periods set forth in Section 5(g)(vi) to make a valid
Grupo VAC Limited Offer and deliver a binding purchase agreement contract
that complies with the requirements set forth in Section 5(g)(vi)) if (A)
Bank of America, Nexus and the BA Investors decline to accept for any
reason such Grupo VAC Limited Offer or decline to enter into the purchase
agreement related to such Grupo VAC Limited Offer or (B) Grupo VAC does
not, for any reason, deliver a purchase offer related to such Grupo VAC
Limited Offer that complies with Section 5(g)(vi), then for a period of 210
days from the date of delivery of the Grupo VAC RLF Notice, the Company,
Nexus, Bank of America and the BA Investors may, at Nexus's and the BA
Investors' option, either (x) enter into a letter of intent and/or an
agreement with respect to a Strategic Combination or (y) subject to Section
5(g)(v), enter into a transaction that would otherwise require the prior
delivery of a Grupo VAC ROFO Notice.
(ix) If, for any reason, the Grupo VAC Representative or any Grupo VAC
Investor attempts to rescind or otherwise revoke any Grupo VAC Offer or
Grupo VAC Limited Offer or if the Grupo VAC Investors fail for any reason
to consummate the purchase of the BA Investors' Shares (or, if an asset
sale, the purchase of the subject assets) after acceptance of a Grupo VAC
Offer or Grupo VAC Limited Offer, the Grupo VAC Representatives and the
Grupo VAC Investors' rights pursuant to this Section 5(g) shall be
terminated automatically, with respect to such offer and all future offers,
and without any further action by the Company, Nexus, Bank of America or
any BA Investor and the Grupo VAC Representative and Grupo VAC Investors
shall have no further rights thereafter with respect to this Section 5(g).
For purposes of clarification, an amendment of a Grupo VAC Offer that only
improves the terms of such Grupo VAC Offer or Grupo VAC Limited Offer for
the BA Investors (e.g., an increase in the consideration) shall not be
treated as a revocation of such Grupo VAC Offer or Grupo VAC Limited Offer.
(x) For purposes of clarification, Nexus and Bank of America may (but
shall not be required to) deliver a Grupo VAC ROFO Notice and/or Grupo VAC
RLO Notice at any time, including, without limitation, prior to Nexus, Bank
of America and/or the Company initiating discussions with any other
Persons, retaining advisors or soliciting other parties with respect to a
transaction involving a (1) Transfer of all of the Shares owned
beneficially or of record by the BA Investors, (2) Drag-Along Sale or (3)
Sale of the Company, including without limitation, a Strategic Combination;
provided, however, that any required Grupo VAC ROFO Notice or Grupo VAC RLO
Notice must still be given within the respective time periods for delivery
thereof in this Section 5(g).
29
(xi) Notwithstanding anything herein to the contrary, any exercise of
the rights under this Section 5(g) is subject to and conditioned upon the
Recusal of the Grupo VAC Director (and its alternate), as well as the Grupo
VAC Representative, Grupo VAC Investors and their respective Affiliates,
representatives and agents (but, with respect to such representatives and
agents, only to the extent that such representatives or agents are working
for or on behalf of any of the Grupo VAC Director (or its alternative), the
Grupo VAC Representative, any Grupo VAC Investor and/or any of their
respective Affiliates), from any meeting, telephone conference,
videoconference, deliberation, analysis, or other discussion by the Board
or the Company's officers and any vote by Board (or any Committee)
regarding any of (1) a Sale of the Company (including, without limitation,
any Strategic Combination), (2) a Drag-Along Sale, (3) a Transfer of all
the Shares owned beneficially or of record by the BA Investors to any
Person (or related Persons) other than a Permitted Transferee or other
Qualified Affiliate of Bank of America, (4) any letter of intent or
agreement related to such a Sale of the Company, Drag-Along Sale or
Transfer by the BA Investors, (5) any Grupo VAC Offer, (6) any Grupo VAC
Limited Offer or (6) any other transaction which would be subject to the
rights set forth in this Section 5(g) (collectively, the "Restricted
Matters"). If any Grupo VAC Director (or its alternate), the Grupo VAC
Representative, any Grupo VAC Investor or any of their respective
representatives or agents fails to Recuse himself or itself from a
Restricted Matter, then the Grupo VAC Investors and the Grupo VAC
Representative shall have no rights under this Section 5(g) with respect to
such Restricted Matter. For purposes of clarification, the Grupo VAC
Investors and the Grupo VAC Representative may affirmatively waive (in
writing) their rights under this Section 5(g) with respect to a specified
Restricted Matter transaction (as opposed to all Restricted Matters) and in
such event, the Grupo VAC Investors and the Grupo VAC Representative shall
have no rights under this Section 5(g) with respect to such Restricted
Matter transaction and the Recusal requirements of this Section 5(g)(xi)
would not apply to such Restricted Transaction and the Grupo VAC investors
and Grupo VAC Director (and its alternate) each shall not be prohibited
from participating in the discussions related to such Restricted Matter in
their respective capacities as a Shareholder or a director of the Company.
"Recusal" means, with respect to a Person, that such Person shall not (A)
attend or participate in any meeting, telephone conference,
videoconference, deliberation, analysis, or other discussion by the Board
or the Company's officers or any vote by the Board (or any Committee)
regarding any Restricted Matter or (B) receive or review any materials
(including, without limitation, (x) copies of any agreement (regardless of
whether in draft or final form), including, without limitation, any letter
of intent or purchase agreement), any proposal, analysis, opinion,
memorandum, presentation or summary, (y) any summaries or minutes of any
meeting of the Company's offices, the Board and/or Committee or (z) any
written resolutions adopted by the Company's Board or any Committee)
related to a Restricted Matter. The Recusal requirement set forth in this
Section 5(g)(xi) shall not prevent the Grupo VAC Representative or any
Grupo VAC Investor from requesting financial information regarding the
Company from the Company's officers in connection with the preparation of a
Grupo VAC Offer or Grupo VAC Limited Offer. Nothing in this Section
5(g)(xi) shall affect the Grupo VAC Investor's rights to Transfer any
Shares owned by the Grupo VAC Investors.
(h) Agreement Regarding Indirect Transfers. Notwithstanding the foregoing,
no Securityholder shall avoid the provisions of this Agreement by (i) making a
Transfer to a Permitted
30
Transferee and then disposing of or transferring all or any portion of such
Securityholder's interest in any such Permitted Transferee, (ii) transferring
ownership interest of such Securityholder or (iii) by entering into any other
transaction intended to avoid or otherwise circumvent the provisions of this
Section 5. In addition, the provisions of this Section 5(h) shall apply to the
Transfer of any beneficial interests, equity interests or other ownership
interests in (1) any trust (including any Permitted Transferee and successor
thereof) that holds any Shares or Options, assuming for purposes of this Section
5(h) that references to the "Company" herein are references to such trust
(including any Permitted Transferee and successor thereof) and that references
to a "Securityholder" (including for purposes of clarification, optionholder)
are references to the beneficiaries thereof, (2) Nexus-Maxcom Holdings I LLC (so
long as it holds any Shares) assuming for purposes of this Section 5(h) that
references to the "Company" herein are references to Nexus-Maxcom Holdings I,
LLC (including any Permitted Transferee and successor thereof) and that
references to a "Securityholder" are references to the members thereof, and (3)
BASCFC-Maxcom Holdings I LLC (so long as it holds any Shares).
(i) Permitted Transferees. Notwithstanding anything to the contrary
contained herein, the restrictions set forth in Sections 5(a) through 5(e),
5(g), 5(h) and 5(k) of this Section shall not apply to any Transfer of any
Shares or Options:
(i) in the case of an individual Securityholder, pursuant to
applicable laws of descent or among such Securityholder's Family Group;
(ii) by and among (1) the Securityholders and (2) the Securityholders
and/or their Qualified Affiliates; provided, however, that if such
Qualified Affiliate ceases to be a Qualified Affiliate, such Qualified
Affiliate shall promptly reconvey any such Shares or Options back to the
transferring Securityholder(s) or optionholder(s), as applicable (or
otherwise comply with the requirements and obligations set forth in this
Section 5)); and
(iii) by and among the BA Investors and/or Bank of America and its
Qualified Affiliate (the Persons specified in clauses (i) through (iii) of
this Section 5(i) are collectively referred to herein as "Permitted
Transferees").
With respect to any Transfer of Shares or Options to a Permitted
Transferee, the restrictions contained in this Section 5 shall continue to apply
to such Shares and Options held by such Permitted Transferee. For purposes of
clarification, any Transfer by a Qualified Investor to another Qualified
Investor shall be subject to Section 5(l).
(j) Public Offering Provisions. Nexus and Bank of America each may, at any
time and from time to time, require that the Company take all requisite actions
necessary or advisable in the opinion of Nexus or Bank of America, at the
Company's expense to consummate 1 (one) or more Public Offerings, on terms and
conditions acceptable to Nexus and Bank of America and enable each BA Investor
to freely sell its Shares. At any time following the sixth anniversary of a
Qualified Public Offering and from time to time thereafter, the Grupo VAC
Representative shall have the right to require that the Company take all
requisite actions necessary or advisable in the opinion of the Grupo VAC
Investor, at the Company's expense to consummate 1 (one) or more Public
Offerings, on terms and conditions acceptable to the Grupo VAC Investor and
enable each Investor to freely sell its Shares.
31
(i) In connection with any Public Offering requested by Nexus, Bank of
America or the Grupo VAC Representative, (A) the Company shall be obligated
to become a public company under the securities laws applicable to such
Public Offering and take such additional actions as may be requested by
Nexus and/or Bank of America (or, with respect to any Pubic Offering
properly requested by the Grupo VAC Representative, such additional actions
as may be requested by the Grupo VAC Representative) in connection with
such Public Offering or as required by applicable law to cause the Company
to become a public company (including entering into underwriting agreements
in customary form in connection with any registered Public Offering) and
(B) each of the Securityholders shall cooperate fully with the Company and
the Company's underwriters and take such additional actions as may be
requested by Nexus and/or Bank of America in connection with such Public
Offering (or, with respect to any Pubic Offering properly requested by the
Grupo VAC Representative, such additional actions as may be requested by
the Grupo VAC Representative in connection with such Public Offering) or as
required by applicable law to cause the Company to become a public company.
(ii) At any time and from time to time, at the request of Nexus or
Bank of America (each such request, a "Registration Request"), the Company
shall take all requisite actions at the Company's expense to permit the
Investors to sell, as soon as practicable, the Shares held by them pursuant
to a registered Public Offering (which may involve the registration of
Equity Securities representing an economic ownership interest in such
Shares) and to enable such holders to freely Transfer their Shares in the
appropriate market as registered securities under applicable securities
law, as soon as practicable after such Registration Request. At any time
following the sixth anniversary of a Qualified Public Offering and from
time to time thereafter, the Grupo VAC Representative shall have the right
to deliver a Registration Request on behalf of all of the Investors.
(iii) In connection with any underwritten Public Offering, Nexus and
Bank of America shall be entitled to select the investment banker and
manager of such Public Offering (i.e., the managing underwriter); provided,
however, that Nexus and Bank of America shall consult with the Grupo VAC
Representative with respect to the selection of the managing underwriter
for any Public Offering properly requested by the Grupo VAC Representative.
(iv) Within 10 (ten) business days after receipt of a Registration
Request, the Company shall give written notice thereof to each other
Investor and, shall, subject to the terms set forth in this section and to
any underwriter cut-backs, include in such registration such number of
Shares held by the Investors for which the Company has received written
requests for inclusion within 15 (fifteen) business days after the receipt
of the Company's notice of such registration.
(v) The Company shall provide a transfer agent and registrar for the
Equity Securities registered in a Public Offering. Nexus and Bank of
America (and, with respect to any Public Offering properly requested by the
Grupo VAC Representative, the Grupo VAC Representative) shall each have the
right to request that any such Equity Securities (at the Company's expense)
be registered at the National Registry of Securities and Intermediaries of
the National Banking and Securities Commission of Mexico. In connection
with any
32
registration and Public Offering, the Company and the holders of Equity
Securities shall use their respective reasonable best efforts to cause the
Company to effect the registration of any such registered Equity Securities
and shall take all such actions to enable the Investors to sell their
Equity Securities in a public sale, or otherwise freely Transfer their
Equity Securities without restrictions (other than any such restrictions
required by the underwriters of all holders of Equity Securities
participating in such offering), in accordance with the Mexican securities
laws and/or, to the extent applicable, United States federal and state
securities laws and others. The Company for this purpose shall assist each
Investor in connection with such public sale and shall furnish all
information which Nexus, Bank of America, such Investor or the managing
underwriters deem necessary or desirable to be disclosed in any prospectus
to be distributed in connection with such public sale. Each Investor shall
be entitled to participate in each Public Offering on a pro rata basis
(based on the aggregate Equity Securities requested by all Investors to be
included in such Public Offering), subject to any cut-backs required by the
underwriters in any underwritten offering. In addition, in connection with
any secondary offering of the Equity Securities, the Investors will be
entitled to participate in such secondary offering prior to any other
Securityholder. If a primary or secondary offering is an underwritten
offering and if the Board, Nexus and Bank of America reasonably determine,
based upon the written advice of the managing underwriter(s), that the
number of Equity Securities requested to be included in such offering
exceeds the number of such securities which can be sold therein without
adversely affecting the marketability of the offering, the Company will
include in such registration (A) the number and type of Equity Securities
requested by the Investors to be included which in the opinion of such
underwriters, can be sold pro rata among the Investors without adverse
effect on the basis of the number of Equity Securities to be registered
held by each such Investor and (B) other Equity Securities requested to be
included in such registration, pro rata among the holders of such Equity
Securities on the basis of the number of Equity Securities held by each
such Securityholder. Notwithstanding anything herein to the contrary, until
the earlier of (i) such time as the BA Investors beneficially own less than
five percent (5%) of the then outstanding Shares or (ii) the sixth
anniversary of a Qualified Public Offering, the Grupo VAC Investors shall
only be entitled to participate in an underwritten offering (or similar
registration) of Shares after the inclusion in any such underwritten
offering (or similar registration) of all of the Shares owned by the other
Investors that are requested to be so included by the other Investors in
such underwritten offering (or similar registration) of Shares.
(vi) If so requested by the underwriters managing any such offering,
(A) no holder of Equity Securities shall, directly or indirectly, Transfer
or offer or agree to Transfer (other than to Affiliates and/or
equityholders of such holders who agree to be similarly bound) any such
Equity Securities during the 30 (thirty) days prior to and the 180-day
period beginning on the expected effective date of any registered Public
Offering (other than with respect to any securities actually being sold in
such Public Offering); provided, however, that following a Qualified Public
Offering the lock-up period for any subsequent Public Offering shall be the
30 (thirty) days prior to and the 90-day period beginning on the expected
effective date of any registered Public Offering and (B) each holder of
Equity Securities shall, if requested by the Company, execute a lock-up
agreement consistent with the terms of the preceding clause (A), subject to
the approval by Nexus or Bank of America of the terms of such lock-up
agreement. In each case, the Company shall use its commercially reasonable
33
efforts to notify all record Securityholders of the exact date of any
lock-up period to which such holders are subject. Any attempted Transfer of
Equity Securities in violation of these provisions shall be null and void
ab initio and shall not be consented to or recognized or registered by the
Company for any purpose.
(vii) At the request of Nexus at any time following a Qualified Public
Offering (or the Grupo VAC Representative at any time following the sixth
anniversary of a Qualified Public Offering), the Company shall use its best
efforts to file with the Securities and Exchange Commission a shelf
registration statement pursuant to Rule 415 promulgated under the
Securities Act.
(viii) Following a Public Offering, upon the reasonable request of any
Securityholder, the Company shall, at its expense, provide such
Securityholder a reasonable number of copies of the registration statement
and prospectus relating to the registered Equity Securities of the Company.
(ix) The Company will provide reasonable and customary indemnification
to each participating Securityholder (including such participant's
directors, officers and employees) in a registered Public Offering, for
losses caused by any material misstatement or omission in any registration
statement or prospectus provided by the Company to such participating
Securityholder for use in connection with a resale of Shares, except
insofar as such losses are caused by a material misstatement or omission
based upon information relating to information furnished to the Company by
any of the participating Securityholders. As a condition to participating
in any registered Public Offering, each participating Securityholder will
provide reasonable and customary indemnification (in form and substance
satisfactory to Nexus) to the Company and its directors, officers, and
affiliates but only with reference to information relating to such
participating Securityholder furnished to the Company by or on behalf of
such participant expressly for use in any registration statement or
prospectus.
(k) Shares held by CPO Trustee. Any Shares held of record by the CPO
Trustee may not be directly Transferred by the CPO Trustee without the consent
of the Board (including at least 1 (one) Nexus Director); provided, however,
that nothing in this Section 5 shall restrict the Transfer of any CPOs in
accordance with the Trust Agreement.
(l) Participation Right (Tag-Along Rights) on Transfers by Qualified
Investors to other Qualified Investors.
(i) In connection with any Transfer by a Qualified Investor to a
Permitted Transferee, if such Transfer is to a Permitted Transferee that is
a Qualified Investor that is not a Qualified Affiliate of the transferring
Qualified Investor (and other than a Transfer pursuant to a Drag-Along Sale
or a Transfer to the Grupo VAC Investors pursuant to Section 5(g)), then
(A) the other Qualified Investors shall have the right to participate in
such Transfer pursuant to this Section 5(l), (B) such transferring
Qualified Investor shall deliver written notice thereof (the "Special
Tag-Along Right Notice") to the Secretary of the Board, and (C) the
Secretary of the Board shall then promptly (but in any event within 5
(five) days) deliver to the other Qualified Investors, at the registered
addresses of such Qualified Investor on file with the Company, such Special
Tag-Along Right Notice, disclosing the number of Shares to be Transferred,
the proposed price, terms and conditions of the Transfer (including,
34
without limitation, a description of any expense, escrow, holdback,
earn-out, indemnity or similar obligations to which the participating
Securityholders shall be responsible) and the identity of the prospective
transferee(s).
(ii) All Qualified Investors may elect to participate on a pro rata
basis (based on the number of Shares) in the contemplated Transfer
described in the Special Tag-Along Right Notice by giving written notice to
the transferring Qualified Investor within 20 (twenty) days after delivery
of the Special Tag-Along Right Notice to the Company (the "Special
Tag-Along Window"). Each such Qualified Investor may participate in the
contemplated Transfer at the same price and, subject to clause (vi) below,
on the same terms specified in the Special Tag-Along Right Notice;
provided, however, that if a Qualified Investor holds more than 1 (one)
class or series of Shares, such Qualified Investor's rights under this
Section 5(l) to participate in such Transfer shall be allocated
proportionately among all of the Shares owned by such Qualified Investor
(e.g. if a Transfer pursuant to a Special Tag-Along-Right Notice is
contemplated, a Qualified Investor holding 1,000 Series B Shares and 1,000
Series N Shares would be required to Transfer an equal number of both
Series B and Series N Shares). The failure to deliver notice electing to
participate within a Special Tag-Along Window shall be deemed an automatic
and complete waiver of all rights to participate in such Transfer pursuant
to this Section 5(l).
(iii) If no Qualified Investor elects to participate in the
contemplated Transfer (either by giving notice to such effect or failing to
give notice within the Special Tag-Along Window), then, pursuant to and on
the terms substantially as described in the Special Tag-Along Right Notice,
the transferring Qualified Investor may Transfer such Shares to the other
Qualified Investor(s) specified in the Special Tag-Along Right Notice for a
period equal to 120 days after the expiration of the Special Tag-Along
Window; provided, however, that there will be an automatic 60-day extension
of such 120-day period to the extent that regulatory approvals for a
Transfer have not been obtained within such original 120-day period. If the
transferring Qualified Investor fails to Transfer such Shares to such other
Qualified Investor as described in the Special Tag-Along Notice within such
applicable period, the transferring Qualified Investor shall not Transfer
such Shares to such Qualified Investor without again complying with the
provisions of this Section 5(l).
(iv) No transferring Qualified Investor shall Transfer any of its
Shares to another Qualified Investor that is not a Qualified Affiliate of
the transferring Qualified Investor if such prospective transferee declines
to allow the participation of the other Qualified Investors on the terms
provided in this Section 5(l), unless and only to the extent that the
prospective transferee may not hold such other Qualified Investors' Shares
because of ownership restrictions on such Shares imposed by the Company
Bylaws or applicable Mexican law.
(v) The right of each Qualified Investor to participate in a Transfer
pursuant to this Section 5(l) is subject to such Qualified Investor's
satisfaction of the same conditions set forth in Section 5(e)(v) for
participation in a Transfer under Section 5(e) (i.e., the same limitations
on the representations and warranties, indemnification obligations,
execution of ancillary documents, etc. will apply to the participating
Qualified Investors).
35
(vi) To the extent that a Qualified Investor holds Shares subject to
restrictions on ownership pursuant to the Company Bylaws or applicable
Mexican law (e.g., Series A Shares may only be owned by Mexicans), such
Qualified Investor will only be eligible to Transfer such restricted Shares
pursuant to this Section 5(l) to purchasers who are eligible to own such
restricted Shares.
(m) Restriction on Competition by Grupo VAC Investors. As a condition to
the Grupo VAC Investors' rights under Section 3, Section 2(a), and Section 4(a),
during the five-year period beginning on the Closing Date (as defined in the TR
Purchase Agreement), the Grupo VAC Investors will not and shall cause each of
their Affiliates not to, directly or indirectly, (A) participate in any business
that is competitive with the telecommunications businesses conducted or proposed
to be conducted in Mexico or the United States as of the Closing Date by the
Company, any of its subsidiaries or any TR Company (as defined in the TR
Purchase Agreement), including, without limitation, using all or any portion of
the Two FO Strands (as defined in the TR Purchase Agreement) in a manner that
directly or indirectly competes with the Company's telecommunications business
(including, without limitation, leasing or otherwise commercializing the Two FO
Strands) or (B) own any interest in, operate, manage, join, control, finance,
participate in the ownership, management, operation or control of, or be paid or
employed by, or acquire any securities of, or otherwise become associated with
or provide assistance to, as an employee, consultant, director, officer,
shareholder, partner, member, agent, associate, principal, creditor,
representative or in any other capacity, any sole proprietorship or business
entity engaged either directly or indirectly in competition with the
telecommunications businesses conducted or proposed to be conducted by Company
or the TR Companies as of the Closing Date; provided, however, that the
foregoing shall not prohibit or restrict the ability of the Grupo VAC Investors
and their respective Affiliates to collectively own, beneficially or of record,
less than five percent (5%) of any publicly-traded corporation. The Grupo VAC
Investors understand and acknowledge that their rights under Section 3, Section
2(a), and Section 4(a) shall be automatically terminated upon any violation of
this Section 5(m).
(n) Termination.
(i) The restrictions on Transfer contained in Section 5(b) shall
terminate upon the earliest to occur of (A) the consummation of a Sale of
the Company, (B) the consummation of a Qualified Public Offering in which
all the Shares owned beneficially by the BA Investors are registered and
sold, (C) subject to the prior written consent thereto of Nexus, upon the
requirement of the managing underwriter in connection with a Qualified
Public Offering, (D) the effectiveness of the Regulatory Amendments and the
modifications to the Company's capital structure described in Section 6,
and (E) upon the agreement of the Board and Nexus to so terminate.
(ii) The right of first refusal set forth in Section 5(c) shall
terminate upon the earliest to occur of (A) the consummation of a Sale of
the Company, (B) the effectiveness of the Regulatory Amendments and the
modifications to the Company's capital structure described in Section 6,
and (C) upon the agreement of the Board and Nexus to so terminate such
restrictions.
36
(iii) The requirements contained in Sections 5(d), 5(e), 5(f), 5(g)
and 5(l) shall terminate upon the earliest to occur of (A) the consummation
of a Sale of the Company, (B) the consummation of a Qualified Public
Offering in which all the Shares owned beneficially by the BA Investors are
registered and sold; provided, however, that in the case of any termination
of the requirements contained in Section 5(d), 5(e) or 5(l) pursuant to
this clause (B), that the Grupo VAC Investors also agree to such
termination, (C) subject to the prior consent thereto of Nexus, upon the
written requirement of the managing underwriter in connection with a
Qualified Public Offering, and (D) upon the agreement of the Board, Nexus
and the Grupo VAC Representative to so terminate all or any of the
requirements in such sections of this Agreement.
(iv) The restrictions on Transfer contained in Section 5(k) shall
terminate upon the earlier to occur of (A) the consummation of a Sale of
the Company and (B) the dissolution of the trust established pursuant to
the CPO Investment Trust Agreement; provided, however, that the
restrictions on Transfer set forth in this Section 5 shall continue to
apply to the Shares previously held by the CPO Trustee.
(v) The restrictions contained in Section 5(m) shall terminate upon
the earlier to occur of (A) the fifth anniversary of the Closing Date and
(B) the agreement of the Board and Nexus to so terminate such restrictions.
SECTION 6. FOREIGN INVESTMENT AND TELECOMMUNICATION LAW. If at any time the
Foreign Investment Law and the Federal Telecommunications Law of Mexico are
amended so as to permit the unrestricted ownership and/or control of the Company
by 1 (one) or more foreign (i.e., non-Mexican) entities, upon the effectiveness
of such amendments (the "Regulatory Amendments") the Shares shall be
automatically converted on a one-to-one basis into a single series of common
shares with voting rights determined on a pro rata basis based on all such
common shares voting together as a single class. The Company and each
Securityholder shall take all actions necessary or requested by Nexus or Bank of
America in connection with effectuating the modifications to the Company's
capital structure described in this Section 6.
SECTION 7. SHARE CERTIFICATE NOTATION.
(a) The Company's share certificates for all of its shares (other than
certificates representing Series N Shares held by the CPO Trustee) shall bear
the following legend and any other legend required by the Board and any Nexus
Director:
"The shares represented by this certificate are subject to the
restrictions specified herein and in the Third Amended and Restated
Securityholders Agreement, dated as of July 19, 2006, as amended and
modified from time to time, a copy of which is on file at the
Company's offices."
(b) The Company shall place the legend described in subsection (a) above on
each and every certificate evidencing Shares (other than certificates
representing Series N Shares held by the CPO Trustee) outstanding as of the date
hereof, including any certificate evidencing Shares that was
37
issued prior to the date hereof. The legend set forth above in subsection (a)
shall be removed from the certificates evidencing any Shares upon their Transfer
in a Public Sale.
(c) The Company shall register this Agreement (and any amendments hereto)
in its head office, shall enter into the Securityholders' Registry Book a
notation acceptable to the Board and at least one Nexus Director, shall certify
to the Securityholders that such notation has been made to the Securityholders'
Registry Book and shall comply fully with the obligations undertaken herein.
SECTION 8. MISCELLANEOUS.
(a) Amendment and Waiver. Except as otherwise expressly provided herein, no
modification, amendment or waiver of any provision of this Agreement shall be
effective against the Company or the Securityholders unless such modification,
amendment or waiver is approved in writing by each of (i) the Company and (ii)
Nexus; provided, however, that in the event that any such modification,
amendment or waiver would materially and adversely affect the rights or
obligations of a holder or group of holders of Shares in a manner different than
any other holders of Shares, then such modification, amendment or waiver will
require the consent of such holder of Shares or a majority of the Shares held by
such group of holders materially and adversely affected; provided, further, that
in the event that any such modification, amendment or waiver would materially
and adversely affect the rights or obligations of the Grupo VAC Investors. Such
modification, amendment or waiver will require the consent of the Grupo VAC
Representative.
(b) Successors and Assigns. Subject to the restrictions on Transfer set
forth in Section 5, this Agreement and each of the rights and obligations
hereunder shall bind and inure to the benefit of and be enforceable by the
Securityholders and any subsequent holders of Securities and their respective
successors and assigns, and shall be binding upon the Company and it successors
and assigns. In addition, whether or not any express assignment has been made,
unless otherwise expressly provided herein, the provisions of this Agreement
which are for any Securityholder's benefit as a holder of Securities are also
for the benefit of, and enforceable by, any subsequent holder of such
Securities; provided, however, that such subsequent holder has acquired such
Securities in accordance with the provisions of this Agreement, including
Section 5 above.
(c) Counterparts. This Agreement may be executed in multiple counterparts
(including by means of telecopied signature pages), each of which shall be an
original and all of which taken together shall constitute one and the same
agreement.
(d) Notices. Any notice provided for in this Agreement shall be in writing
and shall be either personally delivered, sent by reputable overnight courier
service (charges prepaid) or sent by facsimile and followed with a copy sent by
a reputable overnight courier (charges prepaid) to the Company and any other
recipient at the address indicated on the signature pages hereto and to any
subsequent holder of Shares subject to this Agreement at such address as
indicated by the Company's records, or at such address or to the attention of
such other Person as the recipient party has specified by prior written notice
to the sending party. Notices shall be deemed to have been given hereunder (i)
upon receipt by or delivery to the recipient party, (ii) upon personal delivery
as set forth above, or (iii) the date delivery is confirmed by facsimile or
reputable overnight courier as set forth above; provided, however, that any
service of process or other notice of any court or other legal proceeding or
action shall be made by personal delivery to the recipient or its agent for
service of process
38
(including the Process Agent (as defined below) and any of its employees). Each
notice delivered under this Agreement shall be made in English and the English
version shall govern in the event of any inconsistency with any non-English
translation thereof.
(e) Governing Law; Jurisdiction. UNLESS AND EXCEPT TO THE EXTENT ANY
PROVISION HEREOF IS REQUIRED BY MEXICAN LAW TO BE GOVERNED BY MEXICAN LAW, THIS
AGREEMENT, ITS INTERPRETATION AND ENFORCEABILITY AND THE RIGHTS AND OBLIGATIONS
OF THE PARTIES HEREUNDER SHALL BE CONSTRUED IN ACCORDANCE WITH AND BE GOVERNED
BY THE INTERNAL LAWS (AND NOT THE LAWS OF CONFLICT) OF THE STATE OF ILLINOIS,
UNITED STATES OF AMERICA. Any legal action or proceeding to enforce the
obligation of any party to resolve any dispute in accordance with Section 8(f)
or to enforce an order or award made pursuant to an arbitration under Section
8(f) may be brought in (i) the courts of the State of Illinois, United States of
America, (ii) the courts of the United States for the Northern District of
Illinois, (iii) the competent courts of Mexico, D.F., pursuant to the New York
Convention for the Recognition and Enforcement of Foreign Arbitration Awards, or
(iv) any other court of competent jurisdiction and, by execution and delivery of
this Agreement, each party hereby irrevocably accepts for itself and in respect
of its property, generally and unconditionally, the jurisdiction of each of the
aforesaid courts. The Company, each Existing Securityholders and each Additional
Securityholders not resident in or organized under the laws of the United States
each hereby irrevocably appoints CT Corporation (the "Process Agent") (a process
agent service company located in the United States at ▇▇▇ ▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, 60604), as its authorized agent for service of process in any
such court and notice under this Agreement and agrees to maintain such
appointment for so long as any Investor owns any Securities and to further
evidence such appointment in an escritura publica executed before a notary
public in Mexico in conformity with Article 2596 of the Civil Code of the
Federal District and the 1958 Protocol on the Uniformity of Powers of Attorney
to be Utilized Abroad. The Company shall pay all expenses in connection with
such appointment of CT Corporation as the Company's and such Existing
Securityholder's and Additional Securityholder's agent. Each party hereby
further irrevocably waives any claim that any such courts lack jurisdiction over
such party or that service of process or venue is improper, and agrees not to
plead or claim, in any legal action or proceeding with respect to this Agreement
brought in any of the aforesaid courts, that any such court lacks jurisdiction
over such party or that venue or service of process is improper or that the
action has been brought in an inconvenient forum. Nothing herein shall affect
the right of any Investor to serve process in any other manner permitted by law.
(f) Arbitration. If any dispute or claim arises out of this Agreement, or
as to the rights and liabilities of the parties hereunder, or as to the breach
or invalidity hereof, or in connection with the construction of this Agreement,
including any dispute, claim or difference as to whether an issue can be
arbitrated, the parties shall settle such dispute exclusively by binding
arbitration by an arbitrator appointed by the International Chamber of Commerce
in accordance with the rules of the International Chamber of Commerce in New
York City in effect as of the date of commencement of the arbitration. The
arbitration shall be commenced by the delivery of written notice by the party
seeking arbitration to the other parties to the dispute, shall be held in New
York City, New York, unless the parties mutually agree to have the arbitration
held elsewhere, shall be conducted solely in the English language, shall utilize
the English versions of all of the Transaction Agreements, the Company Bylaws,
and this Agreement and judgment upon the award made therein may be entered by
any court having jurisdiction there over; provided, however, that nothing
39
contained in this Section 8(f) shall be construed to limit or preclude a party
from bringing any action in any court of competent jurisdiction in the United
States or Mexico solely for the purpose of enforcing any final judgment or award
made pursuant to an arbitration under this Section 8(f) or enforcing the
obligation of any other party hereto to resolve any dispute in accordance with
this Section 8(f). Notwithstanding anything to the contrary in this Agreement,
the unsuccessful party in any such arbitration proceeding shall pay to the
successful parties all costs and expenses incurred by the successful party in
connection with such arbitration proceeding, including all costs and expenses of
outside counsel and all reasonable costs and expenses of their advisers.
(g) Governing Language. This Agreement has been negotiated and executed by
the parties hereto in English. A Spanish translation of this Agreement has been
prepared solely for convenience. As among the Company and the Securityholders,
in the event of any inconsistency between or among the non-English and the
English versions of this Agreement and any other Transaction Agreement or this
Agreement, the provisions of the English version shall prevail.
(h) U.S. GAAP. Any calculations and accounting determinations under this
Agreement, shall be made in accordance with United States generally accepted
accounting principles, consistently applied in the preparation of the Company's
audited financial statements.
(i) Rule of Construction. Each of the parties hereto acknowledge and agree
that such party and its counsel have reviewed and revised this Agreement and
that the normal rule of construction to the effect that any ambiguities are to
be resolved against the drafting party shall not be employed in the
interpretation of this Agreement or any amendment, exhibit or schedule hereto.
(j) Further Assurances. Each beneficial owner of Shares shall cause the
record owner of such Shares to comply fully with each and every obligation
imposed on the holder of such Shares under this Agreement. Each of the parties
hereto agrees to take such additional actions, including executing and
delivering, or causing to be executed and delivered, to the Company such
instruments as Nexus or the Company may from time to time reasonably request or
as may be otherwise necessary to more effectively effectuate the corporate
governance matters and restrictions on Transfer set forth herein.
(k) Complete Agreement. This Agreement, the Security Trust Agreement the
other Transaction Agreements and the other documents and writings expressly
referred to herein or therein or delivered pursuant hereto or thereto (in their
English versions) contain the entire understanding of the parties hereto with
respect to the subject matter hereof and thereof and supersede all prior
agreements, representations and understandings, whether written and oral, among
any of the parties with respect to the subject matter hereof and thereof
(including without limitation, the First and Second Amended and Restated
Securityholders Agreements).
(l) Special Provisions for Optionholders.
(i) Director and Management Options. The Management Option Plan (as
defined in that certain agreement, dated as of May 8, 1998 among certain
investors, the Company and certain of the Existing Securityholders, as
amended and modified from time to time in accordance with its terms), the
New Stock Option Plan 2001-2003 (as adopted by the Board on February 19,
2002 and approved by the Company's shareholders on March 5, 2002), and the
Fulvio Del ▇▇▇▇▇ Stock Option Plan (as adopted by the Board on February 19,
40
2002 and approved by the Company's shareholders on March 5, 2002) each
grants options ("Management Options") to members of the Company's
management, members of the Board and to certain management service
providers for the acquisition of Series N Shares (shares acquired pursuant
to the Management Options or as a result of a non-prohibited assignment or
Transfer thereof being referred to herein as "Management Shares") as set
forth therein. Certain options granted under the Management Option Plan for
management services in 2000 to BAICC, LA Strategic Capital Partners II and
B&A have been renegotiated by the Company and such optionholders
(collectively, the "2000 Special Options"). The revised terms of the 2000
Special Options were approved by the Board on February 19, 2002 and the
Company's shareholders on March 5, 2002. Subject to the execution by each
party exercising any Management Option (including any 2000 Special
Options), to the extent such party is not already a party hereto, of a
counterpart signature page to this Agreement which binds it to the
provisions of this Agreement, the parties hereto hereby agree that such
Management Options, including the 2000 Special Options may be exercised
from time to time and the Management Shares may be issued upon each such
exercise, in each case subject to the terms of the Management Option Plan,
without any further action or approval by any of the Securityholders or the
Board and that each recipient of a Management Option, upon the exercise of
any such Management Option, shall for all purposes of this Agreement be
deemed to be an "Existing Securityholders," and a "Securityholder" with
respect to such Management Shares.
(ii) Amsterdam Options. The Engagement Letter dated November 13, 1997
as amended on March 13, 1998 and April 2, 1998 between the Company and
Amsterdam Pacific LLC grants options ("Amsterdam Options") to Amsterdam
Pacific LLC (together with any other holder of any Amsterdam Options,
"APLLC") for the acquisition of Series N Shares (shares acquired pursuant
to the Amsterdam Options or as a result of a non-prohibited assignment or
Transfer thereof being referred to herein as "Amsterdam Shares") as set
forth therein. Subject to the execution by APLLC of a counterpart signature
page to this Agreement which binds it to the provisions of this Agreement,
the parties hereto hereby agree that the Amsterdam Options may be exercised
from time to time and the Amsterdam Shares may be issued upon each such
exercise in each case subject to the terms of the Engagement Letter,
without any further action or approval by any of the Securityholders or the
Board and that APLLC, upon the exercise of any Amsterdam Options, shall for
all purposes of this Agreement be deemed to be an "Additional
Securityholders," and a "Securityholder."
(m) Termination of Agreement. Notwithstanding anything to the contrary
contained in this Agreement, at such time as the Investors collectively hold,
directly or indirectly, less than ten percent (10%) of the then outstanding
Shares, this Agreement shall automatically terminate and be of no further force
or effect.
(n) Understanding Among the Securityholders. The determination of each
Securityholder to acquire Shares and enter into this Agreement has been made by
such Securityholder independent of any other Securityholder and independent of
any statements or opinions as to the advisability of such purchase or as to the
properties, business, prospects or condition (financial or otherwise) of the
Company and its subsidiaries which may have been made or given to such
Securityholder by any other Securityholder or by any agent or employee of any
other
41
Securityholder. Each Securityholder acknowledges and agrees that no other
Securityholder shall be responsible in any way or held liable or accountable to
any extent for any information, documents, materials, analysis, projections,
plans or other data (or compilations thereof) relating to the Company or the
transactions contemplated hereby (collectively, "Investment Data") provided to
such Securityholder by any other Securityholder, and each Securityholder agrees
to hold harmless and not make any claims against any other Securityholder with
respect to any Investment Data provided to such Securityholder by such other
Securityholder. In addition, it is acknowledged by each of the other
Securityholder that none of the BA Investors has acted as an agent of such
Securityholder in connection with the making of its investment in the Shares and
that none of Nexus, BASCFC, BankAmerica International Investment Corporation or
LA Strategic Partners II is or shall be acting as an agent of such
Securityholder in connection with monitoring its investment hereunder.
(o) Acknowledgment re ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇ LLP. Maxcom, Nexus, BASCFC,
Bankamerica International Investment Corporation and certain other of the BA
Investors have retained ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇ LLP in connection with this Agreement
and may in the future retain ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇ LLP in connection with the matters
contemplated by this Agreement. Each of the other Securityholder understands
that ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇ LLP is not representing and shall not be deemed to be
representing any of such other Securityholder in connection with this Agreement
or other matters contemplated by this Agreement unless and until (i)
specifically requested by such other Securityholder and agreed to by ▇▇▇▇▇▇▇▇ &
▇▇▇▇▇ LLP, and (ii) such other Securityholder signs a written retention and
conflict waiver letter provided by ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇ LLP.
*****
42
IN WITNESS WHEREOF, the parties hereto have executed this Third
Amended and Restated Securityholders agreement on the day and year first above
written(1).
COMPANY:
MAXCOM TELECOMUNICACIONES, S.A. de C.V.
By:
------------------------------------
Name:
----------------------------------
Its:
-----------------------------------
Address:
C. ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ No. 2000
Penthouse
Col. ▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇
▇.▇. ▇▇▇▇▇ ▇▇▇▇▇▇, D.F.
Telecopy: ▇▇-▇▇-▇▇▇▇-▇▇▇▇
Attention: Chief Executive Officer
With a copy to: General Counsel
With an additional copy to:
Nexus-Banc of America Fund II, L.P.
c/o Nexus Partners LLC
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ - ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇.▇.▇.
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
----------
(1) ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ TO UPDATE SIGNATURE PAGES
SIGNATURE PAGE TO THIRD AMENDED AND RESTATED SECURITYHOLDERS AGREEMENT
ORIGINAL INVESTORS:
BANKAMERICA INTERNATIONAL
INVESTMENT CORPORATION
By:
------------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Its: Authorized Signatory
Address:
c/o Nexus Partners LLC
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ - ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
BANKAMERICA INVESTMENT CORPORATION
By:
------------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Its: Authorized Signatory
Address:
c/o Nexus Partners LLC
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ - ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
----------------------------------------
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, as a "BAIIC Investor"
Address:
c/o Nexus Partners LLC
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ - ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇▇▇▇▇
SIGNATURE PAGE TO THIRD AMENDED AND RESTATED SECURITYHOLDERS AGREEMENT
BACHOW INVESTMENT PARTNERS III, LP
By: Bala Equity Partners, L.P.
Its: General Partner
By: Bala Equity, Inc.
Its: General Partner
By:
------------------------------------
Name:
----------------------------------
Its:
-----------------------------------
Address:
▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇
▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇.▇.▇.
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇, as a "Bachow Investor"
Address:
▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇.▇.▇.
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
----------------------------------------
▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, as a "Bachow
Investor"
Address:
▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇.▇.▇.
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
----------------------------------------
▇▇▇ ▇. ▇▇▇▇, as a "Bachow Investor"
Address:
▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇
Bala ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇.▇.▇.
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
SIGNATURE PAGE TO THIRD AMENDED AND RESTATED SECURITYHOLDERS AGREEMENT
LATINVEST STRATEGIC INVESTMENT FUND,
L.P.
By:
------------------------------------
Name:
----------------------------------
Its:
-----------------------------------
Address:
6000 Est. ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇
▇▇. ▇▇▇▇▇▇ ▇▇▇▇▇, ▇.▇. Virgin Islands
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
Attention: Hurdle H. (Trip) ▇▇▇, III
SIGNATURE PAGE TO THIRD AMENDED AND RESTATED SECURITYHOLDERS AGREEMENT
BAS CAPITAL FUNDING CORPORATION
By:
------------------------------------
Name:
----------------------------------
Its:
-----------------------------------
Address:
c/o Nexus Partners LLC
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ - ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
BASCFC-MAXCOM HOLDINGS I, LLC
By:
------------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Its: Manager
Address:
c/o BAS Capital Funding Corporation
c/o Nexus Partners LLC
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ - ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
SIGNATURE PAGE TO THIRD AMENDED AND RESTATED SECURITYHOLDERS AGREEMENT
NEXUS-MAXCOM HOLDINGS I, LLC
By:
------------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Its: Manager
Address:
c/o Nexus Partners LLC
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ - ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
NEXUS-BANC OF AMERICA FUND II, L.P.,
By: Nexus Partners II, L.P.
Its: General Partner
By: Nexus Partners, LLC
Its: General Partner
By:
------------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Its: Manager
Address:
c/o Nexus Partners LLC
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CREDIT SUISSE FIRST BOSTON CORPORATION
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SECURITYHOLDERS:
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Alina ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
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TELEREUNION INTERNATIONAL, S.A. DE C.V.
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CONTROLADORA PROFESIONAL REGIOMONTANA,
S.A. DE C.V.
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AMSTERDAM PACIFIC LLC
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Ral Guijarro de Pablo
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ATTACHMENTS
EXHIBITS
Exhibit A: Company Bylaws
Exhibit B: Company Guidelines
EXHIBIT A
Company Bylaws
TO BE ATTACHED
EXHIBIT B
Company Guidelines
MAXCOM TELECOMUNICACIONES, S.A. DE C.V., S.A. DE C.V.
Payment Practices:
The United States Foreign Corrupt Practices Act (the "FCPA") prohibits,
among other things, certain payments and accounting practices and, if violated,
carries civil and criminal liability for Maxcom Telecomunicaciones, S.A. de C.V.
("Maxcom" or the "Company") and individual employees. In order to comply with
the FCPA, directors, employees, agents, contractors and affiliates, as
applicable, must observe the following rules:
- Business and Accounting Practices -- Company employees and agents
shall adhere to all legal requirements of Mexico and each political
subdivision thereof, and each other country in which the Company
conducts business. The Company and all of its employees, agents,
contractors and affiliates shall employ the highest ethical standards.
No undisclosed or unrecorded Company fund or asset shall be
established or utilized for any purpose, no false or misleading
entries shall be made in the Company's books or records and all
transactions of the Company shall be recorded on its books and
records. No payment on the Company's behalf shall be without complete
and proper supporting documentation or made for any purpose other than
as described in such documentation and all payments will be made for
lawful purposes only. Company personnel shall comply with generally
accepted accounting rules, the FCPA and Company internal control
policies at all times.
- Questionable Payments -- With the exception of certain regulatory fees
set by the government and facilitating payments (defined below), all
payments, promises to pay, offers of payment of anything of value to
any official, foreign or otherwise, political party or official
thereof from either the Company or private funds in furtherance of
Company business are strictly prohibited. Where, in accordance with
the practice and custom of a particular locale, the payment of a
nominal sum (a "facilitating payment") must be made in order to induce
an official of a foreign government to perform an act which the
official would be required to perform in any event, such facilitating
payment is not prohibited to the extent it is permitted under
applicable law. These facilitating payments must be properly approved,
documented and recorded on the Company's books.
- Political Contributions -- The Company, as a corporate entity, will
not make any contributions or payments to political parties,
candidates, or initiative or referendum campaigns, unless such
payments are clearly permitted by law and approved by the appropriate
Company officer. This restriction is not intended to discourage
employees from making contributions to, or being involved with
candidates, parties, initiative or referenda or political committees
of their choice as private individuals. Such involvement, however,
must be on the employees' own time and at their own expense and must
in no way indicate the Company endorsement of or position relating to
such activity.
B-1
Integrity of the Company Assets and Information:
- Trade Secrets -- Company assets are more than physical plants and
equipment. They include technology and concepts, valuable ideas,
business and product plans, as well as information about the business.
All employees shall regard and preserve as confidential and shall not
divulge to unauthorized persons any information of a secret,
confidential, or private nature connected with the business of the
Company or any of its suppliers, customers or affiliates without the
prior written consent of the appropriate Company officer. No employee
shall disclose to the Company or use to benefit the Company any
confidential information which was obtained outside the Company,
except as permitted by the terms of an applicable nondisclosure
agreement.
- Accurate Reporting -- All employee reports of any kind (such as
expense reports, hours worked, sales reports, etc.) must be completed
accurately and honestly. Failure to so report, in addition to being a
violation of Company policy, may also be illegal.
- Public Disclosure -- Since both the Company and individual employees
may become liable to investors who buy or sell the Company stock in
reliance on misleading or incomplete Company statements, all public
statements must be accurate, and any projections of future performance
must come from top level management. All inquiries from investors,
securities or financial analysts or brokers involving requests for
specific or detailed Company information should be directed to the
appropriate Company officer.
- Employee Information -- The Company collects, uses and maintains only
employee information that is required for business or legal reasons.
The Company provides employees access to their personnel files as a
means of insuring that information in such records is correct. The
Company will not release employee information without the approval of
the employee affected except to verify employment or to satisfy
legitimate investigatory or legal requirements.
Conflict of Interest Policy:
A conflict of interest is any activity or interest which is inconsistent
with, or opposed to the best interests of, the Company. Potential conflicts of
interest may arise in the following situations:
- Interest in Other Businesses -- Employees should not have any direct
or indirect financial interest with a present customer, competitor or
supplier that could cause divided loyalty or the appearance of divided
loyalty. (This prohibition does not include passive investments of not
more than three percent of the total outstanding shares of any company
listed on a recognized Mexican, United States or other foreign or
domestic stock exchange).
- Moonlighting -- The Company expects each employee (other than
part-time employees) to devote his or her full time and attention to
his or her commitment to the Company. Therefore, all such employees
are discouraged from maintaining outside employment. Salaried
employees may not engage in outside work or services for a current or
potential: (i) customer, (ii) competitor or (iii) supplier of the
Company under any circumstances. Salaried employees may engage in
other outside business activities only with the prior written approval
of the appropriate Company officer. Hourly employees may not engage in
outside employment where such employment may create a conflict of
interest (for example, working for a current or potential
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competitor). Hourly employees may engage in other outside business
activities with the prior written approval of the appropriate Company
officer. Under no circumstances may outside employment by any employee
(other than part-time employees) lessen his or her efficiency,
alertness, interest or productivity.
- Gifts and Other Gratuities -- No employee or any member of his or her
household shall accept gifts or gratuities or other favored treatment
from any person associated with a present or prospective customer or
supplier of the Company. Similarly, no employee may give money or
gifts to a customer, competitor or supplier if it could be reasonably
viewed as being done to gain an unfair business advantage.
- Family -- No employee may conduct Company business with a person with
whom he or she is related by blood, law or marriage, or a business
organization with which the employee or person with whom such employee
is related by blood, law or marriage has a significant association,
without first having the prior written approval of the appropriate
Company officer.
Trade Regulations:
Trade laws and regulations in the United States and elsewhere are designed
to ▇▇▇▇▇▇ a competitive marketplace and prohibit activities in restraint of
trade. Generally any actions taken either individually, or in combination with
others, which are predatory toward a competitor or by nature restrain
competition, are most likely violations of one or more antitrust laws. The
following prohibitions, although not inclusive, represent significant practices
which are contrary to the policies of the Company and are prohibited.
- Arrangements or understandings with competitors or potential
competitors concerning prices of products or other competitive
policies or practices are strictly prohibited and shall not be even
the subject of discussion by any Company employee with a competitor or
potential competitor.
- In any potential or actual joint venture or projects with competitors
or potential competitors, all discussions must be limited to the
specific transactions involved.
- Participation in trade associations, seminars or other groups must not
be, or even appear to be, an occasion for any discussion of
competitive policies and practices.
- Arrangements or understandings with a particular competitor or
customer, potential competitor or potential customer not to deal with
a particular customer or supplier or potential customer or potential
supplier are strictly prohibited.
- Agreements or understandings whereby Company customers or potential
customers agree with the Company not to purchase the goods or services
of a competitor or a potential competitor of the Company are strictly
prohibited.
Environmental Policy:
- Basic Policy - It is the policy of the Company to conduct its
activities with due
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concern for the human and natural environment while making and
marketing safe and high quality products and services for its
customers. This is to be accomplished in a manner that will benefit
the present and future well-being of the communities in which the
Company maintains or plans to maintain facilities and conducts
business activities. The Company and its affiliates, agents and
employees shall, at all times, operate as good corporate citizens and
meet or exceed all applicable environmental laws and regulations.
- Responsibility - The Chief Operating Officer shall be responsible for
conducting the Company's operations in a manner that assures
compliance with environmental laws and with the Company's policy. Each
facility shall maintain an environmental management and compliance
program appropriate to its operations in fulfillment of this
responsibility. Environmental factors shall be taken into
consideration in the development of all business plans, operations and
activities.
- The Director of External Affairs is responsible for providing program
management direction, establishing program guidelines, advising
personnel of regulatory requirements and assisting in meeting
compliance responsibilities.
- Reports - The following environmental regulatory events shall be
promptly communicated to the Director of External Affairs and the
Chief Operating Officer: (1) regulatory agency permit notices; (2)
reports on test results, internal or agency, indicating permit
noncompliance; (3) notices of noncompliance with environmental
regulations or permits; (4) negotiations or orders involving
regulation or permit compliance; and (5) environmental related
incidents which are reportable to any governmental agency or could
result in a negative impact on the Company.
Employment Discrimination and Harassment:
The Company maintains a policy of nondiscrimination towards employees and
applicants for employment. No aspect of hiring or employment will be influenced
in any manner by race, color, religion, sex, age, national origin, disability,
or any other basis prohibited by statute.
The Company also strives to afford all employees a workplace free from
sexual harassment. The Company prohibits unwelcome sexual advances, requests for
sexual favors, and other verbal or physical conduct of a sexual nature (whether
implicit or explicit) where such conduct has the purpose or effect of
unreasonably interfering with an individual's work performance or creating an
intimidating, hostile or offensive work environment. The Company also prohibits
harassment not overtly sexual in nature but directed at, or commenting on,
attributes or characteristics of a person solely because of, or on the basis of,
his or her sex. Finally, the Company prohibits retaliation against any person
who refuses or objects to unwelcome verbal or physical conduct or who reports
any of the above conduct.
All supervisory and management personnel are responsible for assuring a
workplace free from discrimination and harassment. All employees are responsible
for refraining from all forms of discriminatory or harassing conduct or
language.
Procurement Policy:
B-4
Procurement decisions are to be made only with the participation of the
Company's purchasing, legal and accounting departments and in accordance with
the procurement policies of the Company. Exceptions to this policy may be made
only with the approval of the appropriate Company officer.
Compliance:
Admittedly no summary of guidelines for ethical business conduct covers
every instance. The absence of a guideline covering a particular situation does
not relieve the employee from the responsibility to operate with the highest
ethical standards of business conduct. Because each Company employee, in the
final analysis, is responsible for his or her actions, no Company employee
should hesitate to seek guidance and assistance for any questions regarding
compliance. The responsibility for administering these standards is delegated to
the appropriate Company officer with respect to the employees within their
jurisdiction. In addition, each employee has the responsibility to report
unethical business practices or violations of the Company's Standards of
Business Conduct to the officer or director in charge of internal controls who
will investigate such violations and report serious violations to the Company's
board of directors.
Each of the Chief Operating Officer, the Chief Executive Officer and the
President is charged with bringing matters concerning his own conduct to the
Board.
Each employee's ultimate responsibility is to the Company, not to any
individual, and to comply with the law. If an employee believes his or her
superior is not responding to a clear violation of these policies or the law, it
is that employee's duty, however unpleasant, to inform the next superior
officer, and if the matter is not addressed, ultimately the Chief Executive
Officer and the Board. Each employee shall also have the right to bring any such
matters to the attention of the Board.
Integrity is a matter of character. Each Company employee must insist that
each other Company employee, individually, and collectively, always meet the
highest ethical standards of business conduct.
Disciplinary Actions:
Maxcom will take appropriate disciplinary action against employees that
violate these guidelines, which disciplinary action will be consistent with
applicable law.
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