Document:

exv4w15

 

EXHIBIT 4.15

REGISTRATION RIGHTS AGREEMENT

                 THIS REGISTRATION RIGHTS AGREEMENT (the “Agreement”) is made and entered
into as of November 29, 2001, between NEXTEL COMMUNICATIONS, INC., a Delaware
corporation (the “Company”), and NEOWORLD HOLDINGS, LLC, a Delaware limited
liability company, (“NeoWorld Holdings”).

                 A. NeoWorld Holdings owns all of the issued and outstanding capital stock
of NeoWorld Communications Inc., a Delaware corporation (“NeoWorld
Communications”).

                 B. On March 28, 2001, NeoWorld Holdings and Unrestricted Subsidiary
Funding Company, a Delaware corporation and a direct, wholly-owned subsidiary
of the Company (“USFCo”), entered into an option agreement (the “Option
Agreement”) pursuant to which USFCo has the right to purchase all of the issued
and outstanding capital stock of NeoWorld Communications and of any other
entities (the “License Entities”) owned by NeoWorld Holdings that own, manage
and/or operate 900 MHz specialized mobile radio systems pursuant to licenses
issued by the Federal Communications Commission.

                 C. USFCo has elected to exercise its rights under the Option Agreement
pursuant to a Notice of Option Exercise and Memorandum of Agreement between
USFCo and Seller made on October 30, 2001. USFCo has assigned its rights to
FCI 900, Inc., a Delaware corporation and a wholly-owned subsidiary of the
Company (“Acquisition Sub”), as permitted under the Option Agreement.
Acquisition Sub has elected to exercise its rights under the Option Agreement
and has entered into a Stock Purchase and Exchange Agreement (the “Purchase
Agreement”) pursuant to which Acquisition Sub has agreed to purchase and
NeoWorld Holdings has agreed to sell pursuant to the terms set forth in the
Purchase Agreement all of the issued and outstanding capital stock of NeoWorld
and of each License Entity.

                 D. The Purchase Price (as defined below) for the capital stock of NeoWorld
Communications and the License Entities is payable in the Company’s Class A
Common Stock, par value $0.001 per share (the “Company Common Stock”), cash, or
a combination of Company Common Stock and cash; provided, that any Company
Common Stock issued as payment of the Purchase Price must be registered for
resale on the Closing Date (as defined below) pursuant to the terms of an
effective registration statement under the 1933 Act (as defined below) pursuant
to this Agreement.

                 E. If the Company pays all of the Purchase Price in cash, this Agreement
will terminate and the Company shall have no obligations under this Agreement.

                 NOW, THEREFORE, in consideration of the mutual agreements contained
herein, the Company and NeoWorld Holdings agree as follows:

                 1. Definitions.

                 As used in this Agreement, the following terms have the following
meanings:

 

 

		
	 	        “1933 Act” means the Securities Act of 1933, as amended from time to
time, or any successor federal statute, and the rules and regulations of
the SEC issued under such act, as they each may, from time to time, be
amended.
	 
	 	        “1934 Act” means the Securities Exchange Act of 1934, as amended
from time to time, or any successor federal statute, and the rules and
regulations of the SEC issued under such act, as they each may, from time
to time, be amended.
	 
	 	        “Acquisition Sub” has the meaning set forth in the recitals.
	 
	 	        “Agreement” has the meaning set forth in the preamble.
	 
	 	        “Closing Date” has the meaning set forth in the Purchase Agreement,
and shall include any extensions thereof as contemplated by the Purchase
Agreement.
	 
	 	        “Company” has the meaning set forth in the preamble and shall also
include the Company’s successors.
	 
	 	        “Company Common Stock” has the meaning set forth in the recitals.
	 
	 	        “Holder(s)” means (i) NeoWorld Holdings, for so long as it owns any
Registrable Securities, and (ii) any Member that holds Registrable
Securities as a result of the distribution of Registrable Securities from
NeoWorld Holdings to such Member upon any dissolution or liquidation of
NeoWorld Holdings or similar event, provided that such Member has agreed
to be bound by the provisions of this Agreement.
	 
	 	        “indemnified party” has the meaning set forth in Section 4(c).
	 
	 	        “indemnifying party” has the meaning set forth in Section 4(c).
	 
	 	        “License Entities” has the meaning set forth in the recitals.
	 
	 	        “Member” means any holder of membership interests in NeoWorld
Holdings.
	 
	 	        “NeoWorld Communications” has the meaning set forth in the recitals.
	 
	 	        “NeoWorld Holdings” has the meaning set forth in the preamble.
	 
	 	        “Option Agreement” has the meaning set forth in the recitals.
	 
	 	        “Other Stockholders” means Persons other than Holders, who, by
virtue of agreements with the Company or any affiliate of the Company,
whether entered into prior to, on, or after the date hereof, are entitled
to include securities of the Company in the Shelf Registration.
	 
	 	        “Permitted Interruption” has the meaning set forth in Section 5.
	 
	 	        “Person” means an individual, partnership, corporation, trust or
unincorporated organization, or a government or agency or political
subdivision thereof.

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	 	        “Prospectus” means the prospectus included in the Shelf Registration
Statement, including any preliminary prospectus, and any such prospectus
as amended or supplemented by any prospectus supplement, and by all other
amendments and supplements to such prospectus, and in each case including
all material incorporated by reference therein.
	 
	 	        “Purchase Agreement” has the meaning set forth in the recitals.
	 
	 	        “Purchase Price” has the meaning set forth in the Purchase
Agreement.
	 
	 	        “Registrable Securities” means shares of Company Common Stock
acquired by NeoWorld Holdings pursuant to the Purchase Agreement;
provided, however, that any such shares of Company Common Stock shall
cease to be Registrable Securities when they (i) have been sold pursuant
to the Shelf Registration Statement, (ii) have been or may be sold
pursuant to Rule 144 of the 1933 Act, (iii) have been transferred to
someone other than a Holder, or (iv) have ceased to be outstanding.
	 
	 	        “Registration Expenses” means any and all expenses incident to
performance of or compliance by the Company with this Agreement,
including without limitation: (i) all SEC, stock exchange or National
Association of Securities Dealers, Inc. registration and filing fees,
(ii) all fees and expenses incurred by the Company in connection with
compliance with state securities or blue sky laws, (iii) all expenses
incurred by the Company of preparing word processing, printing and
distributing the Shelf Registration Statement, any Prospectus, any
amendments or supplements thereto, (iv) the fees and disbursements of
counsel for the Company and (v) the fees and disbursements of the
independent public accountants of the Company, including the expenses of
any special audits, but excluding (x) fees and expenses of counsel to the
Holders and (y) underwriting discounts and commissions, brokers
commissions or similar fees and transfer taxes, if any, relating to the
sale or disposition of Registrable Securities by a Holder.
	 
	 	        “Registration Period” has the meaning set forth in Section 2(a)
hereof.
	 
	 	        “SEC” means the Securities and Exchange Commission.
	 
	 	        “Shelf Registration” means a registration effected pursuant to
Section 2 hereof.
	 
	 	        “Shelf Registration Statement” means a “shelf” registration
statement of the Company that covers an offering to be made on a
continuous basis of all of the Registrable Securities (and may include
other securities of the Company held by Other Stockholders) on an
appropriate form under Rule 415 under the 1933 Act, or any similar rule
that may be adopted by the SEC, and all amendments and supplements to
such registration statement, including post-effective amendments, in each
case including the Prospectus contained therein, all exhibits thereto and
all material incorporated by reference therein.
	 
	 	        “USFCo” has the meaning set forth in the recitals.

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                 2. Registration Under the 1933 Act.

                 (a) To the extent not prohibited by any applicable law or applicable
interpretation of the staff of the SEC, the Company shall file a Shelf
Registration Statement and use its commercially reasonable best efforts to
cause the Shelf Registration Statement to be declared effective by the SEC on
or before the Closing Date and to remain effective until the earlier of (i) 365
days from the date the Shelf Registration Statement is declared effective or
(ii) the date on which all Registrable Securities covered by such Shelf
Registration Statement have been sold (the “Registration Period”).

                 (b) The Company shall pay all Registration Expenses in connection with the
registration pursuant to this Section 2. Each Holder shall pay (i) all
underwriting discounts and commissions, brokers commissions or similar fees and
transfer taxes, if any and (ii) the fees and expenses of counsel to the
Holders, if any, pro rata in proportion to the number of Registrable Securities
sold by such Holder pursuant to the Shelf Registration Statement in relation to
all Registrable Securities sold pursuant to the Shelf Registration Statement.

                 (c) In addition to the Registrable Securities, the Company may include in
the Shelf Registration securities held by Other Stockholders.

                 3. Registration Procedures.

                 (a) In connection with the obligations of the Company with respect to the
Shelf Registration Statement, the Company shall:

                       (1) prepare and file with the SEC the Shelf Registration Statement on an
appropriate form under the 1933 Act, which form (x) shall be selected by the
Company and (y) shall be available for the sale of the Registrable Securities
by the selling Holders thereof and (z) shall comply as to form in all material
respects with the requirements of the applicable form;

                       (2) prepare and file with the SEC such amendments and post-effective
amendments to the Shelf Registration Statement as may be necessary to keep the
Shelf Registration Statement effective for the Registration Period and cause
each Prospectus to be supplemented by any required prospectus supplement and
cause any supplement to be filed pursuant to Rule 424 under the 1933 Act;

                       (3) promptly furnish to each Holder of Registrable Securities and to one
counsel for the Holders, if any, without charge, as many copies of each
Prospectus, including each preliminary Prospectus, and any supplement thereto
and such other documents as such Holder or counsel may reasonably request, in
order to facilitate the public sale or other disposition of the Registrable
Securities; and the Company consents to the use of such Prospectus and any
amendment or supplement thereto in accordance with applicable law by each of
the selling Holders of Registrable Securities in connection with the offering
and sale of the Registrable Securities in accordance with the plan and manner
of distribution which is attached hereto as Annex A and which will be included
in the Prospectus;

                       (4) use its reasonable best efforts to register or qualify the Registrable
Securities under all applicable state securities or “blue sky” laws of such
jurisdictions as any

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 Holder of Registrable Securities shall reasonably request in writing by
the time the Shelf Registration Statement is filed with the SEC, and do any and
all other acts and things that may be reasonably necessary or advisable to
enable such Holder to consummate the disposition in each such jurisdiction of
such Registrable Securities owned by such Holder; provided, however, that the
Company shall not be required to (i) qualify as a foreign corporation or as a
dealer in securities in any jurisdiction where it would not otherwise be
required to qualify but for this Section 3(a)(4), (ii) file any general consent
to service of process or (iii) subject itself to taxation in any such
jurisdiction if it is not so subject;

                       (5) promptly notify each Holder of Registrable Securities, counsel for the
Holders and, if requested by any such Holder or counsel, confirm such advice in
writing (i) when the Shelf Registration Statement has become effective and when
any post-effective amendment thereto has been filed and becomes effective, (ii)
of any request by the SEC or any state securities authority for amendments and
supplements to the Shelf Registration Statement and Prospectus or for
additional information after the Shelf Registration Statement has become
effective, (iii) of the issuance by the SEC or any state securities authority
of any stop order suspending the effectiveness of the Shelf Registration
Statement or the initiation of any proceedings for that purpose, or of any
notification with respect to the suspension of the qualification of the
Registrable Securities for sale in any jurisdiction or the initiation of any
proceeding for such purpose, and in any such case, the Company shall make every
reasonable effort to obtain the withdrawal of any order suspending the
effectiveness of the Shelf Registration Statement and provide immediate notice
to each Holder of the withdrawal of any such order; and

                       (6) upon request, furnish to each Holder, without charge, at least one
conformed copy of the Shelf Registration Statement and any post-effective
amendment thereto (without documents incorporated therein by reference or
exhibits thereto);

                       (7) cooperate with the selling Holders to facilitate the timely
preparation and delivery of certificates representing Registrable Securities to
be sold and not bearing any restrictive legends and enable such Registrable
Securities to be in such denominations and registered in such names as the
selling Holders may reasonably request at least three business days prior to
the closing of any sale of Registrable Securities;

                       (8) upon the occurrence of any event during the Registration Period that
makes any statement made in the Shelf Registration Statement or the related
Prospectus untrue in any material respect or that requires the making of any
changes in the Shelf Registration Statement or Prospectus so that they will not
contain any untrue statement of a material fact or omit to state any material
fact required to be stated therein or necessary to make the statements therein
not misleading, the Company shall immediately notify each Holder and use its
commercially reasonable best efforts to prepare and file with the SEC a
supplement or post-effective amendment to the Shelf Registration Statement or
the related Prospectus or any document incorporated therein by reference or
file any other required document so that, as thereafter delivered to the
purchasers of the Registrable Securities, such Prospectus will not contain any
untrue statement of a material fact or omit to state a material fact necessary
to make the statements therein, in light of the circumstances under which they
were made, not misleading.

                       (9) make available for inspection by one representative designated by the
Holders, and an attorney and an accountant designated by the Holders, at
reasonable times and

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 in a reasonable manner, all financial and other records, pertinent
documents and properties of the Company, and cause the respective officers,
directors and employees of the Company to supply all information reasonably
requested by any such representative, attorney or accountant as shall be
necessary to conduct a reasonable investigation within the meaning of the 1933
Act; provided, that, for the purpose of such investigation, such Holders,
attorney and accountant have entered into a confidentiality agreement in a form
satisfactory to the Company;

                       (10) if reasonably requested by any Holder covered by the Shelf
Registration Statement, promptly incorporate in a Prospectus supplement such
information with respect to such Holder as such Holder reasonably requests to
be included therein; and

                 (b) The Company may require each Holder to furnish to the Company such
information regarding the Holder and evidence of its compliance with the terms
of this Agreement and applicable laws and regulations as the Company may from
time to time reasonably request in writing. Each holder agrees to distribute
Registrable Securities only in the manner described in Annex A.

                 (c) Each Holder agrees to, as expeditiously as possible, (i) notify the
Company of the occurrence of any event that makes any statement made in the
Shelf Registration Statement or Prospectus regarding such Holder untrue in any
material respect or that requires the making of any changes in the Shelf
Registration Statement or Prospectus so that, in such regard, (A) in the case
of the Shelf Registration Statement, it will not contain any untrue statement
of material fact or omit to state any material fact required to be stated
therein or necessary to make the statements therein not misleading and (B) in
the case of a Prospectus, it will not contain any untrue statement of material
fact or omit to state any material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances in
which they were made, not misleading, and (ii) provide the Company with such
information as may be required to enable the Company to prepare a supplement or
post-effective amendment to the Shelf Registration Statement or a supplement to
such Prospectus.

                 (d) Each Holder agrees that, upon receipt of any notice from the Company
of the happening of any event of the kind described in Section 3(a)(8) hereof,
such Holder will forthwith discontinue disposition of Registrable Securities
pursuant to the Shelf Registration Statement until such Holder’s receipt of the
copies of the supplemented or amended Prospectus contemplated by Section
3(a)(8) hereof, and, if so directed by the Company, such Holder will deliver to
the Company all copies in its possession, other than permanent file copies then
in such Holder’s possession, of the Prospectus covering such Registrable
Securities current at the time of receipt of such notice. Each Holder agrees
that in the event it receives any notice from the Company under Section
3(a)(8), it will not disclose such fact to any Person.

                 4. Indemnification and Contribution.

                 (a) The Company agrees to indemnify and hold harmless each Holder whose
Registrable Securities are included in the Shelf Registration and each Person,
if any, who controls such Holder within the meaning of the 1933 Act, from and
against all losses, claims, damages and liabilities (including, without
limitation, any legal or other expenses reasonably incurred by such Holder or
any such controlling Person in connection with defending or investigating any
such action or claim) caused by any untrue statement or alleged untrue
statement of a material fact

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 contained in the Shelf Registration Statement (or any amendment thereto)
pursuant to which Registrable Securities were registered under the 1933 Act,
including all documents incorporated therein by reference, or caused by any
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading, or
caused by any untrue statement or alleged untrue statement of a material fact
contained in any Prospectus (as amended or supplemented if the Company has
furnished any amendments or supplements thereto), or caused by any omission or
alleged omission to state therein a material fact necessary to make the
statements therein in light of the circumstances under which they were made not
misleading, except insofar as such losses, claims, damages or liabilities are
caused by any such untrue statement or omission or alleged untrue statement or
omission based upon information furnished to the Company in writing by any
selling Holder or its representatives expressly for use therein. The Company
will also indemnify selling brokers, dealers and similar securities industry
professionals participating in the distribution, their officers and directors
and each Person who controls such Persons within the meaning of the 1933 Act,
to the same extent as provided above with respect to the indemnification of the
Holders, if requested in connection with the Shelf Registration Statement;
provided that, with respect to any untrue statement or omission or alleged
untrue statement or omission made in any preliminary Prospectus, or Prospectus,
the indemnity agreement contained in this Section 4(a) will not inure to the
benefit of any such Person to the extent that any such losses, claims, damages
or liabilities of such Person result from the fact that there was not sent or
given to any Person who purchased Registrable Securities in connection with
such registration, at or prior to the written confirmation of the sale of
Registrable Securities to such Person, a copy of the Prospectus relating to
such registration, as then amended or supplemented (exclusive of material
incorporated by reference), if the Company had previously furnished copies
thereof to such Person.

                 (b) Each Holder of Registrable Securities that are included in the Shelf
Registration agrees, severally and not jointly, to indemnify and hold harmless
the Company and the other selling Holders, and each of their respective
directors, officers who sign the Shelf Registration Statement and each Person,
if any, who controls the Company and any other selling Holder within the
meaning of the 1933 Act to the same extent as the foregoing indemnity from the
Company, but only with reference to information furnished to the Company in
writing by such Holder expressly for use in the Shelf Registration Statement
(or any amendment thereto) or any Prospectus (or any amendment or supplement
thereto). Each Holder of Registrable Securities that are included in the Shelf
Registration will also indemnify selling brokers, dealers and similar
securities industry professionals participating in the distribution, their
officers and directors and each Person who controls such Persons within the
meaning of the 1933 Act, to the same extent as provided with respect to the
indemnification of the Company and the other Selling Holders, if requested in
connection with any Registration Statement; provided that, with respect to any
untrue statement or omission or alleged untrue statement or omission made in
any preliminary Prospectus, or Prospectus, the indemnity agreement contained in
this Section 4(b) will not inure to the benefit of any such Person to the
extent that any such losses, claims, damages or liabilities of such Person
result from the fact that there was not sent or given to any Person who
purchased Registrable Securities in connection with such registration, at or
prior to the written confirmation of the sale of Registrable Securities to such
Person, a copy of the Prospectus relating to such registration, as then amended
or supplemented (exclusive of material incorporated by reference), if the
Company or Holder had previously furnished copies thereof to such Person.

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                 (c) In case any proceeding (including any governmental investigation)
shall be instituted involving any Person in respect of which indemnity may be
sought pursuant to either paragraph (a) or paragraph (b) above, such Person
(the “indemnified party”) shall promptly notify the Person against whom such
indemnity may be sought (the “indemnifying party”) in writing and the
indemnifying party, upon request of the indemnified party, shall retain counsel
reasonably satisfactory to the indemnified party to represent the indemnified
party and any others the indemnifying party may designate in such proceeding
and shall pay the fees and disbursements of such counsel related to such
proceeding. In any such proceeding, any indemnified party shall have the right
to retain its own counsel, but the fees and expenses of such counsel shall be
at the expense of such indemnified party unless (i) the indemnifying party and
the indemnified party shall have mutually agreed to the retention of such
counsel or (ii) the named parties to any such proceeding (including any
impleaded parties) include both the indemnifying party and the indemnified
party and representation of both parties by the same counsel would be
inappropriate due to actual or potential differing interests between them. It
is understood that the indemnifying party shall not, in connection with any
proceeding or related proceedings in the same jurisdiction, be liable for (a)
the fees and expenses of more than one separate firm (in addition to any local
counsel) for the Company, its directors, its officers who sign the Shelf
Registration Statement and each Person, if any, who controls the Company within
the meaning of the 1933 Act and (b) the fees and expenses of more than one
separate firm (in addition to any local counsel) for all Holders and all
Persons, if any, who control any Holders within the meaning of the 1933 Act,
and that all such fees and expenses shall be reimbursed as they are incurred.
In such case involving the Holders and such Persons who control Holders, such
firm shall be designated in writing by the Holders of a majority of the
Registrable Securities then outstanding. In all other cases, such firm shall
be designated by the Company. The indemnifying party shall not be liable for
any settlement of any proceeding effected without its prior written consent
but, if settled with such consent or if there be a final judgment for the
plaintiff, the indemnifying party agrees to indemnify the indemnified party
from and against any loss or liability by reason of such settlement or
judgment. Notwithstanding the foregoing sentence, if at any time an
indemnified party shall have requested an indemnifying party to reimburse the
indemnified party for fees and expenses of counsel as contemplated by the
second and third sentences of this paragraph, the indemnifying party agrees
that it shall be liable for any settlement of any proceeding effected without
its written consent if (i) such settlement is entered into more than 45 days
after receipt by such indemnifying party of the aforesaid request, (ii) such
indemnifying party shall have received notice of the terms of such settlement
at least 30 days prior to such settlement being entered into, and (iii) such
indemnifying party shall not have reimbursed the indemnified party for such
fees and expenses of counsel in accordance with such request prior to the date
of such settlement. No indemnifying party shall, without the prior written
consent of the indemnified party, effect any settlement of any pending or
threatened proceeding in respect of which such indemnified party is or could
have been a party and indemnity could have been sought hereunder by such
indemnified party, unless such settlement (i) includes an unconditional release
of such indemnified party from all liability on claims that are the subject
matter of such proceeding; provided that such unconditional release may be
subject to a parallel release of a claimant or plaintiff by such indemnified
party from all liability in respect of claims or counterclaims asserted by such
indemnified party, and (ii) does not include a statement as to, or an admission
of, fault, culpability or a failure to act by or on behalf of any indemnified
party; provided, further, that, as to each indemnified party withholding such
consent, the maximum amount of the losses, damages or liabilities in respect of
which such indemnified party may seek indemnification hereunder with

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respect to such claim is limited to the amount that the indemnifying party
would have paid to or on behalf of such indemnified party had such indemnified
party consented to such settlement.

                 (d) If the indemnification provided for in paragraph (a) or paragraph (b)
of this Section 4 is unavailable to an indemnified party or insufficient in
respect of any losses, claims, damages or liabilities, then each indemnifying
party under such paragraph, in lieu of indemnifying such indemnified party
thereunder, shall contribute to the amount paid or payable by such indemnified
party as a result of such losses, claims, damages or liabilities in such
proportion as is appropriate to reflect the relative fault of the indemnifying
party or parties on the one hand and of the indemnified party or parties on the
other hand in connection with the statements or omissions that resulted in such
losses, claims, damages or liabilities, as well as any other relevant equitable
considerations. The relative fault of the Company and the Holders shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to
state a material fact relates to information supplied by the Company or by the
Holders and the parties’ relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission. The Holders’
obligations to contribute pursuant to this Section 4(d) are several in
proportion to the aggregate amount of Registrable Securities of such Holder
that were registered pursuant to the Shelf Registration Statement.

                 (e) The Company and each Holder agree that it would not be just or
equitable if contribution pursuant to this Section 4 were determined by pro
rata allocation or by any other method of allocation that does not take account
of the equitable considerations referred to in paragraph (d) above. The amount
paid or payable by an indemnified party as a result of the losses, claims,
damages and liabilities referred to in paragraph (d) above shall be deemed to
include, subject to the limitations set forth above, any legal or other
expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding the
provisions of this Section 4, no Holder shall be required to indemnify or
contribute any amount in excess of the net proceeds received by such Holder in
connection with the sale of the Registrable Securities sold by such Holder. No
Person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the 1933 Act) shall be entitled to contribution from any Person who
was not guilty of fraudulent misrepresentation.

                 The indemnity and contribution provisions contained in this Section 4
shall remain operative and in full force and effect regardless of (i) any
termination of this Agreement, (ii) any investigation made by or on behalf of
any Holder or any Person controlling any Holder, or by or on behalf of the
Company, its officers or directors or any Person controlling the Company, and
(iii) any sale of Registrable Securities pursuant to the Shelf Registration
Statement.

                 5. Permitted Interruption. Notwithstanding any provision of this
Agreement or the Purchase Agreement, the Company shall not be required to
prepare or file the Shelf Registration Statement, any amendment or post-
effective amendment thereto or Prospectus supplement or to supplement or amend
the Shelf Registration Statement or otherwise facilitate the resale of
Registrable Securities, and the Company shall be free to take or omit to take
any other action that would result in the impracticality of any such filing,
supplement or amendment, (x) in connection with pending corporate developments,
public filings with the SEC and similar events, for a period not to exceed 30
days in any three-month period or an aggregate of 90 days (whether or not
consecutive) in any twelve-month period or (y) in connection with any pending
or potential

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 acquisitions, financings or similar transactions, for a period not to
exceed 60 days in any three-month period or 90 days (whether or not
consecutive) in any twelve-month period (any period described in this Section 5
during which the Company is not required to make such filing, amendment or
supplement is herein referred to as a “Permitted Interruption”). If a
Permitted Interruption affects the Shelf Registration Statement during the
Registration Period, the Company agrees to notify each of the Holders so
affected by a Permitted Interruption as promptly as practicable upon each of
the commencement and termination of each Permitted Interruption. The Company
shall not be required in the notice of a Permitted Interruption to disclose the
cause for such Permitted Interruption, and each Holder agrees that it will not
disclose receipt of a notice of Permitted Interruption to any Person. Each
Holder agrees that, upon receipt of any notice from the Company, such Holder
will forthwith discontinue disposition of Registrable Securities pursuant to
the Shelf Registration Statement until such Holder’s receipt of the Company’s
notice as to the termination of the Permitted Interruption. In the event of a
Permitted Interruption during the Registration Period, the Registration Period
shall be extended by the number of days of such period. Nothing in this
Section 5 shall affect Acquisition Sub’s obligations under the Purchase
Agreement to pay the entire Purchase Price in cash if the shares of Company
Common Stock to be issued to NeoWorld Holdings under the Purchase Agreement, if
any, are not registered for resale pursuant to the terms of the Shelf
Registration Statement on or prior to the Closing Date, or on or prior to the
end of the ninety-day extension thereof as contemplated in Section 1.02 of the
Purchase Agreement.

                 6. Miscellaneous.

                 (a) No Inconsistent Agreements. The Company has not entered into, and on
or after the date of this Agreement will not enter into, any agreement that is
inconsistent with the rights granted to the Holders pursuant to this Agreement
or otherwise conflicts with the provisions hereof. The rights granted to the
Holders hereunder do not in any way conflict with and are not inconsistent with
the rights granted to the holders of the Company’s other issued and outstanding
securities under any such agreements.

                 (b) Amendments and Waivers. This Agreement may not be amended, modified
or supplemented, and waivers or consents to departures from the provisions
hereof may not be given unless the Company has obtained the written consent of
Holders of at least a majority of the Registrable Securities then outstanding
affected by such amendment, modification, supplement, waiver or consent;
provided, however, that no amendment, modification, supplement, waiver or
consents to any departure from the provisions of Section 4 hereof shall be
effective as against any Holder unless consented to in writing by such Holder.

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                 (c) Notices. All notices, requests and demands to or upon the respective
parties hereto to be effective must be in writing and, unless otherwise
expressly provided herein, are deemed to have been duly given or made when
delivered by hand or by courier, or by certified mail, or, when transmitted by
facsimile and a confirmation of transmission printed by sender’s facsimile
machine. A copy of any notice given by facsimile also must be mailed, postage
prepaid, to the addressee. Notices to the respective parties hereto must be
addressed as follows:

	 	 	 
	If to NeoWorld Holdings or a Holder:	 	
NeoWorld Holdings, LLC
	 	 	
1515 Broad Street
	 	 	
Bloomfield, New Jersey 07003
	 	 	
Attention: Brian D. McAuley
	 	 	
Telephone: (973) 771-0300
	 	 	
Telecopier: (973) 771-0983
 
	 	 	
With a copy to:
 
	 	 	
Piper Marbury Rudnick & Wolfe LLP
	 	 	
Avenue of the Americas
	 	 	
New York, NY 10020
	 	 	
Attention: Leonard Gubar, Esq.
	 	 	
Telephone: 212-835-6020
	 	 	
Telecopier: 212-835-6101
 
	 	 	
With a copy to:
 
	 	 	
Kirkland & Ellis
	 	 	
200 East Randolph Street
	 	 	
Chicago, IL 60601
	 	 	
Attention: Jeffrey Seifman, Esq.
	 	 	
Telephone: 312-861-2201
	 	 	
Telecopier: 312-861-2200
 
	If to the Company:	 	
Nextel Communications, Inc.
	 	 	
2001 Edmund Halley Dr.
	 	 	
Reston, Virginia 20191
	 	 	
Attention: Leonard J. Kennedy, Esq.
	 	 	
         General Counsel
	 	 	
Telephone: (703) 433-4274
	 	 	
Telecopier: (703) 433-4846

11

 

	 	 	 
	 	 	
With a copy to:
 
	 	 	
Jones, Day, Reavis & Pogue
	 	 	
North Point
	 	 	
901 Lakeside Avenue
	 	 	
Cleveland, OH 44114
	 	 	
Attention: Jeanne M. Rickert, Esq.
	 	 	
Telephone: (216) 586-7220
	 	 	
Telecopier: (216) 579-0212

                 (d) Any party may alter the address to which communications or copies are
to be sent by giving notice of the change of address under this Section

                 (e) Successors and Assigns. This Agreement binds and inures to the
benefit of the Holders and the Company and its successors. No Holder may
assign any of the rights created by this Agreement; except the rights to cause
the Company to register Registrable Securities pursuant to this Agreement may
be assigned by a Holder to a transferee or assignee of Registrable Securities
that is another Holder, provided that (i) the assigning Holder shall promptly
notify the Company in writing of the name and address of such transferee or
assignee and the Securities with respect to which such registration rights are
being assigned and (ii) the Holder and such transferee or assignee execute a
joinder agreement substantially in the form attached hereto as Annex B pursuant
to which such transferee or assignee agrees in writing to be bound by and
subject to all of the terms of this Agreement.

                 (f) Counterparts. This Agreement may be executed in any number of
counterparts and by the parties hereto in separate counterparts, each of which
when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.

                 (g) Headings. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.

                 (h) Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York.

                 (i) Severability. In the event that any one or more of the provisions
contained herein, or the application thereof in any circumstance, is held
invalid, illegal or unenforceable, the validity, legality and enforceability of
any such provision in every other respect and of the remaining provisions
contained herein shall not be affected or impaired thereby.

                 (j) Effectiveness. The effectiveness of this Agreement is conditioned
upon, and the obligations and rights of the parties hereunder will come into
force and effect on, the Closing Date, including any extension thereof as
contemplated by the Purchase Agreement, if and only if Acquisition Sub elects
to pay all or part of the Purchase Price with shares of Company Common Stock.
The Company shall have no obligations under this Agreement and neither NeoWorld
Holdings nor any other Holder shall have any rights under this Agreement in the
event that the Company does not issue shares of Company Common Stock as payment
for all or part of

12

 

 the Purchase Price under the Purchase Agreement. This Agreement will
terminate if Acquisition Sub at any time elects, or is required, under the
Purchase Agreement to pay all of the Purchase Price in cash.

[Signatures on Following Page]

13

 

                 IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.

	 	NEXTEL COMMUNICATIONS, INC.

	 	By:  /s/ MORGAN O’BRIEN 

Name: Morgan O’Brien

Title: Vice Chairman

	 	NEOWORLD HOLDINGS, LLC

	 	By:  /s/ BRIAN D. McCAULEY

Name: Brian D. McCauley

Title: President

14<PAGE>
                                                                   EXHIBIT 10.25

                   SECOND FORBEARANCE AND AMENDMENT NUMBER TWO
                    TO ACCOUNTS RECEIVABLE PURCHASE AGREEMENT

         This Second Forbearance and Amendment Number Two to Accounts Receivable
Purchase Agreement (this "Second Forbearance Agreement"), dated as of July 22,
2002, is entered into by and between the following parties:

               (a)  XETEL CORPORATION, a Delaware corporation (the "Seller");

               (b)  SILICON VALLEY BANK ("Buyer").

                                    RECITALS

         A. The Seller and Buyer have entered into that certain Accounts
Receivable Purchase Agreement, dated as of April 9, 2002 (including any and all
amendments thereto, the "Purchase Agreement"), pursuant to which Buyer agreed to
purchase accounts receivable from Seller, subject to the terms of the Purchase
Agreement.

         B. The Seller and Buyer also have entered into that certain Forbearance
and Amendment Number One to Accounts Receivable Purchase Agreement, dated as of
May 29, 2002 (including any and all amendments thereto, the "First Forbearance
Agreement"), pursuant to which Buyer agreed to forbear temporarily from
exercising certain of Buyer's rights and remedies under the Purchase Agreement
and to provide temporary, additional financing to Seller, subject to the terms
of the First Forbearance Agreement.

         C. Prior to the date of the First Forbearance Agreement, Events of
Default have occurred, as described in clauses (a) and (b) below, and
subsequently have occurred, as described in clause (c) below, under the Purchase
Agreement by reason of the following acts or omissions:

                  (a) the Seller's continuing failure to comply with its
         covenant in Section 6.2(A) of the Purchase Agreement, resulting in an
         Event of Default under Section 9(E) of the Purchase Agreement;

                  (b) the Seller received monies in payment of Purchased
         Receivables and failed to transfer and deliver the same to Buyer;
         instead Borrower used such monies for Seller's working capital
         purposes, all in breach of Section 6.1(F) of the Purchase Agreement,
         which in turn is an Event of Default under Section 9(E) of the Purchase
         Agreement; and

                  (c) the Seller has breached the Additional Warranties,
         Representations, and Covenants in Section 6.2(J) of the Purchase
         Agreement, which in turn is an Event of Default under Section 9(E) of
         the Purchase Agreement, which provides for certain "AP Milestones" that
         were required to be met on May 31, 2002 and on June 30, 2002, which
         relate to the maximum percentage of the Seller's aggregate accounts
         payable that are over 90 days from invoice date.

SECOND FORBEARANCE AND AMENDMENT
NUMBER TWO TO ACCOUNTS RECEIVABLE
PURCHASE AGREEMENT - Page 1
<PAGE>

The Events of Default referred to above and the specific occurrences of these
Events of Default prior to the date of this Forbearance Agreement are referred
to as the "Specific Events of Default."

         D. The Specific Events of Default remain uncured as of this date.

         E. Pursuant to Section 10 of the Purchase Agreement, Buyer is
authorized to exercise various rights and remedies including, but not limited
to, declaring all Obligations immediately due and payable.

         F. The Seller has requested that Buyer extend its agreements to forbear
temporarily from exercising certain of Buyer's rights and remedies under the
Purchase Agreement and to provide temporary, additional financing to Seller, for
an additional period of thirty (30) days, from July 22, 2002 to August 22, 2002.

         G. Buyer has agreed to continue to forbear temporarily, as set forth in
this Second Forbearance Agreement, and to provide temporary additional financing
to Seller.

                                 ACKNOWLEDGMENTS

         A. The Seller hereby acknowledges and agrees to the accuracy of all
Recitals included in this Second Forbearance Agreement.

         B. To the extent that there is a conflict between the terms of this
Second Forbearance Agreement and the terms of the Purchase Agreement or the
First Forbearance Agreement, the terms of this Second Forbearance Agreement
shall govern.

         C. The Seller acknowledges and agrees that, as of July 19, 2002, the
outstanding principal amount of the Obligations is $3,352,636.66, exclusive of
interest, costs, fees, and other expenses payable by the Seller to Buyer under
the Purchase Agreement as of such date.

         D. The Seller further acknowledges and agree that, as a result of the
occurrence of the Specific Events of Default and in conjunction with the First
Forbearance Agreement, the Seller declared Obligations under the Purchase
Agreement due and payable in full, that the entire balance thereof continues to
be immediately due and payable in full, and that Buyer has exercised its right
to cease buying receivables from Seller, the Seller having waived, and hereby
waiving, notice of intention to accelerate, notice of acceleration, and all
other notices, presentments, demands, including without limitation, those set
forth in the Purchase Agreement.

         E. The Seller has submitted to Buyer, and Buyer has received and
approved the operating cash budget through August 31, 2002, dated as of the date
of this Second Forbearance Agreement, and attached hereto as Exhibit "A".

SECOND FORBEARANCE AND AMENDMENT
NUMBER TWO TO ACCOUNTS RECEIVABLE
PURCHASE AGREEMENT - Page 2
<PAGE>

                                   AGREEMENTS

         NOW, THEREFORE, in consideration of the premises herein contained and
other good and valuable consideration, the sufficiency of which is hereby
acknowledged, the parties hereto, intending to be legally bound, agree to the
above Recitals and Acknowledgments, and further as follows:

         1. DEFINITIONS. All capitalized terms used but not otherwise defined in
this Second Forbearance Agreement shall have the meanings ascribed to them in
the Purchase Agreement.

         2. FORBEARANCE. Subject to the terms and conditions set forth in this
Second Forbearance Agreement and the Seller's acknowledgments and agreements set
forth above, and expressly conditioned upon the absence of any additional Events
of Default, and satisfaction and fulfillment of each of the conditions precedent
set forth in Section 3 below and the conditions subsequent set forth in Section
4 below, Buyer shall forbear from demanding payment in full of the Obligations
and forbear from exercising its rights and remedies under Section 10 of the
Purchase Agreement (other than the right to cease buying receivables) as a
result of the Specific Events of Default for a period (the "Forbearance Period")
beginning on the date of this Second Forbearance Agreement and expiring on the
earlier to occur of the following:

                  (1) 5:00 p.m., Pacific time, August 22, 2002; or

                  (2) any occurrence of any Event of Default other than the
         Specific Events of Default or any re-occurrence of a Specific Event of
         Default after the date of this Second Forbearance Agreement.

         3. CONDITIONS PRECEDENT TO EFFECTIVENESS OF FORBEARANCE PERIOD. The
effectiveness of this Second Forbearance Agreement is subject to the
satisfaction of the following conditions precedent, unless specifically waived
in writing by Buyer:

                  3.1. Buyer shall have received this Second Forbearance
Agreement, duly executed by the Seller.

                  3.2. The representations and warranties contained herein and
in the Purchase Agreement shall be true and correct in all material respects on
and as of the date hereof, except as disclosed on Schedule 1 attached hereto and
made a part hereof.

                  3.3. No Default or Event of Default under the Purchase
Agreement shall have occurred and be continuing, other than the Specific Events
of Default, unless such Default or Event of Default has been specifically waived
in writing by Buyer.

SECOND FORBEARANCE AND AMENDMENT
NUMBER TWO TO ACCOUNTS RECEIVABLE
PURCHASE AGREEMENT - Page 3
<PAGE>

         4. CONDITIONS SUBSEQUENT TO EFFECTIVENESS. The continued effectiveness
of this Second Forbearance Agreement is subject to the satisfaction of the
following conditions subsequent, unless specifically waived in writing by Buyer.

                  4.1. Access. The Seller shall give Buyer and Buyer's auditors
or its agent complete access to the Seller's books and records during the
Forbearance Period. The Seller agrees to provide complete cooperation with Buyer
and Buyer's auditors or its agent.

                  4.2. Blocked Accounts. The Seller shall ensure the deposit of
all payments collected by the Seller on its accounts into JP Morgan Chase Bank
account no. 00102630523 or JP Morgan Chase Bank account no. 00102630531 as
required by the Blocked Account Control Agreement. The Seller agrees to provide
complete cooperation with Buyer and Buyer's auditors or its agent, and the
Seller shall provide 100% remittance of all cash collections from all sources
into the blocked accounts described above until further notice.

                  4.3 Deposits into Blocked Accounts. Any and all cash received
by Seller, whether from accounts receivable or otherwise, will be deposited into
one of the blocked accounts described in Section 4.2 above or will be wired to
the Seller's cash collateral account at Buyer, in accordance with the following
instructions: Federal Reserve Bank, for credit to Silicon Valley Bank, ABA # 121
140 399, further credit to XeTel Corporation, Account # 330 036 3022.

         5. AMENDMENTS.

                  5.1. Credit Limit. Section 1 of the Schedule to the Addendum
to the Purchase Agreement (which was added by the First Forbearance Agreement)
is hereby amended and restated in its entirety to read as follows:

                  "Loans (the "Receivable Loans") in the amount not to exceed
the lesser of

                            (1) a total of Four Million Dollars ($4,000,000) at
              any one time outstanding (the "Maximum Credit Limit"), or

                            (2) Loans in an amount not to exceed the amount
              which equals the remainder of

                                          (i) 70% of the amount of Borrower's
                            Eligible Receivables (as defined in Section 8
                            above), minus

                                          (ii) (A) the aggregate amount of
                            Advances under the Purchase Agreement, as determined
                            by Buyer at any time and from time, reduced by (B)
                            the actual amount of collections received by Buyer
                            on the Purchased Receivables."

                  5.2 Interest Rate. The first sentence of Section 2 of the
Schedule to the Addendum to the Purchase Agreement (which was added by the First
Forbearance Agreement) is hereby amended and restated in its entirety to read as
follows:

SECOND FORBEARANCE AND AMENDMENT
NUMBER TWO TO ACCOUNTS RECEIVABLE
PURCHASE AGREEMENT - Page 4
<PAGE>

                            "A rate equal to the "Prime Rate") in effect from
              time to time, plus ten percent (10%) per annum."

                  5.3 Fees. Section 3 of the Schedule to the Addendum to the
Purchase Agreement (which was added by the First Forbearance Agreement) is
hereby amended and restated in its entirety to read as follows:

                  "Collateral Monitoring Fee:   Two Thousand Dollars ($2,000),
                                                per month, payable in arrears
                                                (prorated for any partial month)
                                                at the beginning and at
                                                termination of this Agreement),
                                                beginning for the month ended
                                                July 31, 2002."

                  5.4. Termination Date. Section 16 of the Purchase Agreement is
hereby amended and restated in its entirety to read as follows:

                  "16. TERMINATION DATE. This agreement will terminate on August
22, 2002."

         6. ADDITIONAL AGREEMENTS.

                  6.1 Forbearance Fee. In consideration of the agreements of
Buyer set forth in this Second Forbearance Agreement, Seller agrees to pay Buyer
a weekly forbearance fee (the "Weekly Forbearance Fee") amount of Ten Thousand
Dollars ($10,000) per week. The Weekly Forbearance Fee will be payable in
advance on Monday of each week, beginning Monday, July 29, 2002. In the event
that the Obligations are paid in full to Seller, on or before 2:00 p.m., Austin,
Texas time on August 22, 2002, then Buyer agrees to refund to Seller fifty
percent (50%) of the Weekly Forbearance Fee paid by Seller to Buyer up through
the date of payment in full of the Obligations.

                  6.2. Consent to Relief. In the event of any re-occurrence of a
Specific Event of Default or any breach of the Conditions Precedent, the
Conditions Subsequent or the Additional Agreements set forth in this Second
Forbearance Agreement, then, to the extent that Buyer establishes before a court
of appropriate jurisdiction that any of the foregoing has occurred, the Seller
consents to injunctive relief for the benefit of Buyer in order to enforce the
terms of this Second Forbearance Agreement and the Purchase Agreement.

                  6.3. Potential Capital Infusions. Seller will advise and
inform Buyer of any and all potential infusions of capital, including, but not
limited to, offers from an investor buyer to purchase the Seller, or
substantially all of the assets of the Seller.

         7. RATIFICATIONS, REPRESENTATIONS AND WARRANTIES.

                  7.1. Controlling Agreement. The terms and provisions set forth
in this Second Forbearance Agreement shall supersede all inconsistent terms and
provisions set forth in the Second Purchase Agreement and, except as expressly
set forth in this Second Forbearance Agreement, the terms and provisions of the
Purchase Agreement are ratified and confirmed and

SECOND FORBEARANCE AND AMENDMENT
NUMBER TWO TO ACCOUNTS RECEIVABLE
PURCHASE AGREEMENT - Page 5
<PAGE>

shall continue in full force and effect. The parties hereto agree that the
Purchase Agreement shall continue to be legal, valid, binding and enforceable in
accordance with its terms as amended.

                  7.2. Access. The Seller represents and warrants that the
Seller has given Buyer complete access to the Seller's books and records.

                  7.3. Representations and Warranties. The Seller hereby
represents and warrants to Buyer as follows:

                  (a) the execution, delivery and performance of this Second
         Forbearance Agreement and any and all other agreements executed and/or
         delivered in connection herewith or therewith have been authorized by
         all requisite corporate action on the part of the Seller and will not
         violate the Certificate of Incorporation or Bylaws of the Seller;

                  (b) the representations and warranties contained in this
         Second Forbearance Agreement and the Purchase Agreement are true and
         correct on and as of the date hereof as though made on and as of such
         date, except to the extent that breaches thereof are specifically
         waived by this Second Forbearance Agreement;

                  (c) no Default or Event of Default under the Purchase
         Agreement has occurred and is continuing, other than the Specific
         Events of Default, unless such Default or Event of Default has been
         specifically waived in writing by Buyer;

                  (d) the Seller is in full compliance with all covenants and
         agreements contained in the Purchase Agreement, other than those
         covenants and agreements specifically identified in this Second
         Forbearance Agreement;

                  (e) the consummation of the transactions contemplated hereby
         will not (i) violate any provision of the organizational documents or
         governing instruments of the Seller, (ii) violate any judgment, order,
         ruling, injunction, decree or award of any court, administrative agency
         or governmental body against, or binding upon, the Seller, or (iii)
         constitute a violation by the Seller of any law or regulation of any
         jurisdiction applicable to the Seller;

                  (f) this Second Forbearance Agreement was reviewed by the
         Seller, who acknowledges and agrees that the Seller (i) understands
         fully the terms of this Second Forbearance Agreement and the
         consequences of the issuance hereof, (ii) has been afforded an
         opportunity to have this Second Forbearance Agreement reviewed by, and
         to discuss this Second Forbearance Agreement with, such attorneys and
         other persons as the Seller may wish, and (iii) has entered into this
         Second Forbearance Agreement of its own free will and accord and
         without threat or duress; and

                  (g) this Second Forbearance Agreement and all information
         furnished to Buyer is made and furnished in good faith, for value and
         valuable consideration; and this Second

SECOND FORBEARANCE AND AMENDMENT
NUMBER TWO TO ACCOUNTS RECEIVABLE
PURCHASE AGREEMENT - Page 6
<PAGE>

         Forbearance Agreement has not been made or induced by any fraud, duress
         or undue influence exercised by Buyer or any other person.

         8. MISCELLANEOUS.

                  8.1. Misrepresentation. The Seller shall indemnify and hold
Buyer harmless from and against any losses, damages, costs and expenses
(including attorneys' fees) incurred by Buyer as a direct or indirect result of
(i) breach of any representation or warranty contained in this Second
Forbearance Agreement, or (ii) any breach or default under any of the covenants
or agreements contained in this Second Forbearance Agreement.

                  8.2. Covenants and Agreements. The Seller hereby agrees and
acknowledges that it is well and truly indebted to Buyer pursuant to the terms
of the Purchase Agreement and other documents executed in connection therewith
and hereby agrees to observe, comply with and perform all of the obligations,
terms and conditions under or in the Purchase Agreement and other documents
executed in connection therewith, except as may be amended or waived by this
Second Forbearance Agreement.

                  8.3. Ratification of Liens and Security Interests. The Seller
hereby acknowledges and agrees that the liens and security interests of Buyer,
as more fully described in the Purchase Agreement and documents executed in
connection therewith, are valid and subsisting liens and security interests and
are superior to all liens and security interests other than those exceptions
approved by Buyer in writing and as otherwise permitted under the Purchase
Agreement.

                  8.4. No Waiver. The Seller agrees that nothing contained in
this Second Forbearance Agreement shall affect or impair the validity or
priority of the liens and security interests under any of the documents executed
in connection with the Purchase Agreement. Buyer further reserves all its rights
under the these documents except as expressly modified herein.

                  8.5. Survival of Representations and Warranties. Except as
provided otherwise in this Second Forbearance Agreement, all representations and
warranties made in the Purchase Agreement or any document executed in connection
therewith, including, without limitation, any document furnished in connection
with this Second Forbearance Agreement, shall survive the execution and delivery
of this Second Forbearance Agreement, and no investigation by Buyer or any
closing shall affect the representations and warranties or the right of Buyer to
rely upon them.

                  8.6. Expenses of Buyer. The Seller agrees to pay on demand all
reasonable costs and expenses incurred by Buyer in connection with the
preparation, negotiation and execution of this Second Forbearance Agreement and
any other agreements executed pursuant hereto, including, without limitation,
the reasonable costs and fees of Buyer's legal counsel. The Seller acknowledges
that Buyer may debit the Seller's account to pay such costs and expenses.
Further, the Seller acknowledges that, at the execution and delivery of this
Second Forbearance Agreement, Buyer may debit the Seller's account to pay costs
and expenses, including Buyer's attorneys' fees, incurred at such time.

SECOND FORBEARANCE AND AMENDMENT
NUMBER TWO TO ACCOUNTS RECEIVABLE
PURCHASE AGREEMENT - Page 7
<PAGE>

                  8.7. Severability. Any provision of this Second Forbearance
Agreement held by a court of competent jurisdiction to be invalid or
unenforceable shall not impair or invalidate the remainder of this Second
Forbearance Agreement, and the effect thereof shall be confined to the provision
so held to be invalid or unenforceable.

                  8.8. Successors and Assigns. This Second Forbearance Agreement
will inure to the benefit of and be binding upon the parties hereto and their
respective successors and permitted assigns.

                  8.9. Headings. The headings of the sections and subsections of
this Second Forbearance Agreement are inserted for convenience only and do not
constitute a part of this Second Forbearance Agreement.

                  8.10. Counterparts. This Second Forbearance Agreement may be
executed in counterparts, and when so executed each counterpart shall be deemed
to be an original, and said counterparts together shall constitute one and the
same instrument. However, no party shall be required to exhibit or prove all
counterparts of the original agreement to make proof of same, rather each
counterpart shall constitute an enforceable agreement against the party who has
executed the same.

                  8.11. Facsimile Execution. This Second Forbearance Agreement
may be executed and delivered by facsimile, and the production of a facsimile
counterpart shall have the same force and effect as production of an originally
executed counterpart for all purposes.

                  8.12. No Commitment. The Seller agrees that Buyer has made no
commitment or other agreement regarding the Purchase Agreement, or any document
executed in connection therewith, except as expressly set forth in this Second
Forbearance Agreement. The Seller warrants and represents that the Seller will
not rely on any commitment, further agreement to forbear or other agreement on
the part of Buyer unless such commitment or agreement is in writing and signed
by Buyer.

                  8.13. Survival. All representations, warranties, covenants and
agreements of the parties made in this Second Forbearance Agreement shall
survive the execution and delivery hereof, until such time as all of the
obligations of the parties hereto shall have lapsed in accordance with their
respective terms or shall have been discharged in full.

                  8.14. Time of Essence. The parties to this Second Forbearance
Agreement have agreed specifically with regard to the times for performance set
forth in this Second Forbearance Agreement. Further, the parties to this Second
Forbearance Agreement acknowledge that the agreements with regard to the times
for performance are material to this Second Forbearance Agreement. Therefore,
the parties agree and acknowledge that time is of the essence to this Second
Forbearance Agreement.

SECOND FORBEARANCE AND AMENDMENT
NUMBER TWO TO ACCOUNTS RECEIVABLE
PURCHASE AGREEMENT - Page 8
<PAGE>

                  8.15. LAW GOVERNING. THIS SECOND FORBEARANCE AGREEMENT SHALL
BE DEEMED TO HAVE BEEN SUBSTANTIALLY NEGOTIATED AND MADE IN THE STATE OF
CALIFORNIA AND SHALL BE INTERPRETED AND THE RIGHTS OF THE PARTIES DETERMINED IN
ACCORDANCE WITH THE LAWS OF THE UNITED STATES APPLICABLE THERETO AND THE
INTERNAL LAWS OF THE STATE OF CALIFORNIA APPLICABLE TO AN AGREEMENT EXECUTED,
DELIVERED AND PERFORMED THEREIN, WITHOUT GIVING EFFECT TO THE CHOICE-OF-LAW
RULES THEREOF OR ANY OTHER PRINCIPLE THAT COULD REQUIRE THE APPLICATION OF THE
SUBSTANTIVE LAW OF ANY OTHER JURISDICTION.

                  8.16. WAIVER; MODIFICATION. NO PROVISION OF THIS SECOND
FORBEARANCE AGREEMENT MAY BE WAIVED, CHANGED OR MODIFIED, OR THE DISCHARGE
THEREOF ACKNOWLEDGED, ORALLY, BUT ONLY BY AN AGREEMENT IN WRITING SIGNED BY THE
PARTY AGAINST WHOM THE ENFORCEMENT OF ANY WAIVER, CHANGE, MODIFICATION OR
DISCHARGE IS SOUGHT. NO DELAY ON THE PART OF BUYER IN EXERCISING ANY RIGHT,
POWER OR PRIVILEGE HEREUNDER, SHALL OPERATE AS A WAIVER THEREOF, NOR SHALL ANY
WAIVER OF ANY RIGHT, POWER OR PRIVILEGE HEREUNDER OPERATE AS A WAIVER OF ANY
OTHER RIGHT, POWER OR PRIVILEGE HEREUNDER, NOR SHALL ANY SINGLE OR PARTIAL
EXERCISE OF ANY RIGHT, POWER OR PRIVILEGE HEREUNDER PRECLUDE ANY OTHER OR
FURTHER EXERCISE THEREOF, OR THE EXERCISE OF ANY OTHER RIGHT, POWER OR PRIVILEGE
HEREUNDER. ALL RIGHTS AND REMEDIES HEREIN PROVIDED ARE CUMULATIVE AND ARE NOT
EXCLUSIVE OF ANY RIGHTS OR REMEDIES THAT THE PARTIES HERETO MAY OTHERWISE HAVE
AT LAW OR IN EQUITY.

                  8.17. WAIVER OF JURY TRIAL. TO THE FULLEST EXTENT PERMITTED BY
APPLICABLE LAW, SELLER HEREBY IRREVOCABLY AND EXPRESSLY WAIVES ALL RIGHT TO A
TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED UPON
CONTRACT, TORT, OR OTHERWISE) ARISING OUT OF OR RELATING TO THIS SECOND
FORBEARANCE AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THE ACTIONS OF
BUYER IN THE NEGOTIATION, ADMINISTRATION OR ENFORCEMENT THEREOF.

                  8.18. FINAL AGREEMENT. THIS SECOND FORBEARANCE AGREEMENT AND
THE OTHER DOCUMENTS EXECUTED IN CONNECTION THEREWITH REPRESENT THE ENTIRE
EXPRESSION OF THE PARTIES WITH RESPECT TO THE SUBJECT MATTER HEREOF ON THE DATE
THIS SECOND FORBEARANCE AGREEMENT IS EXECUTED. NEITHER THIS SECOND FORBEARANCE
AGREEMENT NOR THE LOAN DOCUMENTS MAY BE CONTRADICTED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO
UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.

SECOND FORBEARANCE AND AMENDMENT
NUMBER TWO TO ACCOUNTS RECEIVABLE
PURCHASE AGREEMENT - Page 9
<PAGE>

                  8.19. RELEASE. SELLER HEREBY ACKNOWLEDGES THAT AS OF THE DATE
HEREOF IT HAS NO DEFENSE, COUNTERCLAIM, OFFSET, CROSS-COMPLAINT, CLAIM OR DEMAND
OF ANY KIND OR NATURE WHATSOEVER THAT CAN BE ASSERTED TO REDUCE OR ELIMINATE ALL
OR ANY PART OF ITS LIABILITY TO REPAY THE OBLIGATIONS OR TO SEEK AFFIRMATIVE
RELIEF OR DAMAGES OF ANY KIND OR NATURE FROM BUYER OR ITS AFFILIATES,
PARTICIPANTS OR ANY OF THEIR RESPECTIVE DIRECTORS, OFFICERS, AGENTS, EMPLOYEES
OR ATTORNEYS. SELLER HEREBY VOLUNTARILY AND KNOWINGLY RELEASES AND FOREVER
DISCHARGES BUYER, AND ITS AFFILIATES AND PARTICIPANTS, AND ITS PREDECESSORS,
AGENTS, OFFICERS, DIRECTORS, EMPLOYEES, SUCCESSORS AND ASSIGNS, FROM ALL
POSSIBLE CLAIMS, DEMANDS, ACTIONS, CAUSES OF ACTION, DAMAGES, COSTS, EXPENSES,
AND LIABILITIES WHATSOEVER, KNOWN OR UNKNOWN, ANTICIPATED OR UNANTICIPATED,
SUSPECTED OR UNSUSPECTED, FIXED, CONTINGENT, OR CONDITIONAL, AT LAW OR IN
EQUITY, ORIGINATING IN WHOLE OR IN PART ON OR BEFORE THE DATE THIS SECOND
FORBEARANCE AGREEMENT IS EXECUTED, WHICH SELLER MAY NOW OR HEREAFTER HAVE
AGAINST BUYER, ITS PREDECESSORS, AGENTS, OFFICERS, DIRECTORS, EMPLOYEES,
SUCCESSORS AND ASSIGNS, IF ANY, AND IRRESPECTIVE OF WHETHER ANY SUCH CLAIMS
ARISE OUT OF CONTRACT, TORT, VIOLATION OF LAW OR REGULATIONS, OR OTHERWISE, AND
ARISING FROM THE OBLIGATIONS, THE EXERCISE OF ANY RIGHTS AND REMEDIES UNDER THE
PURCHASE AGREEMENT OR OTHER DOCUMENTS EXECUTED IN CONNECTION THEREWITH, AND
NEGOTIATION FOR AND EXECUTION OF THIS FORBEARANCE AGREEMENT. SELLER HEREBY
COVENANTS AND AGREES NEVER TO INSTITUTE ANY ACTION OR SUIT AT LAW OR IN EQUITY,
NOR INSTITUTE, PROSECUTE, OR IN ANY WAY AID IN THE INSTITUTION OR PROSECUTION OF
ANY CLAIM, ACTION OR CAUSE OF ACTION, RIGHTS TO RECOVER DEBTS OR DEMANDS OF ANY
NATURE AGAINST BUYER, ITS AFFILIATES, AND PARTICIPANTS, AND THEIR RESPECTIVE
SUCCESSORS, AGENTS, ATTORNEYS, OFFICERS, DIRECTORS, EMPLOYEES, AND PERSONAL AND
LEGAL REPRESENTATIVES ARISING OUT OF OR RELATED TO LENDER'S ACTIONS, OMISSIONS,
STATEMENTS, REQUESTS OR DEMANDS IN ADMINISTERING, ENFORCING, MONITORING,
COLLECTION OR ATTEMPTING TO COLLECT THE INDEBTEDNESS OF SELLER TO BUYER, WHICH
INDEBTEDNESS WAS EVIDENCED BY THE PURCHASE AGREEMENT AND THE LOAN DOCUMENTS.

                  8.20. Agreement Binding on the Seller. The Seller agrees that
this Second Forbearance Agreement will be binding on the Seller.

                            [Signature page follows.]

SECOND FORBEARANCE AND AMENDMENT
NUMBER TWO TO ACCOUNTS RECEIVABLE
PURCHASE AGREEMENT - Page 10
<PAGE>

         IN WITNESS WHEREOF, the Seller and Buyer have caused this Second
Forbearance Agreement to be executed and delivered as of the date first written.

                                           SELLER:

                                           XETEL CORPORATION,
                                           a Delaware corporation

                                           By:
                                              ----------------------------------
                                           Name:
                                                --------------------------------
                                           Title:
                                                  ------------------------------

                                           BUYER:

                                           SILICON VALLEY BANK

                                           By:
                                              ----------------------------------
                                           Name:
                                                --------------------------------
                                           Title:
                                                 -------------------------------

SECOND FORBEARANCE AND AMENDMENT
NUMBER TWO TO ACCOUNTS RECEIVABLE
PURCHASE AGREEMENT - Page 11
<PAGE>

                                   EXHIBIT "A"

                              OPERATING CASH BUDGET

                                 [See attached.]

EXHIBIT "A"
<PAGE>

                                   SCHEDULE 1

                  Exceptions to Representations and Warranties

1.       Borrower has received notice of a payroll tax penalty in the amount(s)
         as set forth in the attached Schedule 2. Borrower is disputing a
         portion of the penalty in the amount as set forth in the attached
         Schedule 2. Borrower will pay or cause the Internal Revenue Service to
         offset the undisputed portion of the penalty on or before July 31,
         2002.

SCHEDULE 1

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00042-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00042-of-00352.parquet"}]]