Document:

Exhibit

Exhibit 4.1

Execution Version

NII HOLDINGS, INC.
and 
WILMINGTON TRUST, NATIONAL ASSOCIATION  
as Trustee  
 

FIRST SUPPLEMENTAL INDENTURE 
DATED AS OF DECEMBER 18, 2019 

FIRST SUPPLEMENTAL INDENTURE dated as of December 18, 2019 (this “First Supplemental Indenture”), between NII Holdings, Inc., a Delaware corporation (the “Company”), and Wilmington Trust, National Association, a national banking association, as trustee (the “Trustee”).
WHEREAS, the Company and the Trustee have entered into an Indenture dated as of August 14, 2018 (the “Indenture”) in connection with the issuance of up to $115,000,000 of the Company’s 4.25% Convertible Senior Notes due 2023 (the “Notes”) (capitalized terms used herein without definition have the meanings given such terms in the Indenture);
WHEREAS, pursuant to Section 10.01 of the Indenture, the Company wishes to irrevocably elect Cash Settlement as the Settlement Method for any conversion of Notes permitted under the Indenture;
WHEREAS, the conditions set forth in the Indenture for the execution and delivery of this First Supplemental Indenture have been complied with; and 
WHEREAS, all things necessary to make this First Supplemental Indenture a valid supplement to the Indenture pursuant to its terms and the terms of the Indenture have been done.
NOW, THEREFORE, the parties hereto agree as follows:
Article 1
IRREVOCABLE ELECTION OF CASH SETTLEMENT
Section 1.01    Irrevocable Election of Cash Settlement.  The Company hereby irrevocably elects Cash Settlement as the Settlement Method for any conversion of Notes permitted under the Indenture.
Article 2
MISCELLANEOUS. 
Section 2.01    Governing Law.  THIS FIRST SUPPLEMENTAL INDENTURE AND ANY CLAIM, CONTROVERSY OR DISPUTE ARISING UNDER OR RELATED TO THIS FIRST SUPPLEMENTAL INDENTURE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK (WITHOUT REGARD TO THE CONFLICTS OF LAWS PROVISIONS THEREOF).
Section 2.02    Execution in Counterparts.  This First Supplemental Indenture may be executed in any number of counterparts, each of which shall be an original, but such counterparts shall together constitute but one and the same instrument. The exchange of copies of this First Supplemental Indenture and of signature pages by facsimile or PDF transmission shall constitute effective execution and delivery of this First Supplemental Indenture as to the parties hereto and may be used in lieu of the original First Supplemental Indenture for all purposes. Signatures of the 

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parties hereto transmitted by facsimile or PDF shall be deemed to be their original signatures for all purposes.
Section 2.03    Headings.  The headings of the articles and sections of this First Supplemental Indenture have been inserted for convenience of reference only, are not to be considered a part hereof, and shall in no way modify or restrict any of the terms or provisions hereof.
Section 2.04    The Trustee.    In entering into this First Supplemental Indenture, the Trustee shall be entitled to the benefit of every provision of the Indenture relating to the conduct of, or affecting the liability of, the Trustee, whether or not elsewhere herein so provided. The Trustee makes no representation as to the validity, execution or sufficiency of this First Supplemental Indenture other than as to the validity of its execution and delivery by the Trustee. The Trustee assumes no responsibility for the correctness of the recitals contained herein, which shall be taken as a statement of the Company. 
[Signature pages follow.]

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IN WITNESS WHEREOF, the parties have caused this First Supplemental Indenture to be duly executed, all as of the date first above written.

NII HOLDINGS, INC.
		
	By:
	       
Name:  Shana C. Smith 
Title:  Vice President, General Counsel and Corporate Secretary 

WILMINGTON TRUST, NATIONAL ASSOCIATION, 
as Trustee
		
	By:
	     
Name:   
Title:Exhibit

                     
Exhibit 10.1
                                    
EXECUSION VERSION

ESCROW AGREEMENT

 
This Escrow Agreement dated this 18th day of December, 2019 (the “Escrow Agreement”), is entered into by and between NII Holdings, Inc., a Delaware corporation (the “Company”), Wilmington Trust, National Association (with its successors or assigns, the “Trustee” and together with the Company, each a “Party” and collectively, the “Parties”) and Wilmington Trust, National Association, as escrow agent (“Escrow Agent”).  
 
RECITALS

 
WHEREAS, the Company issued $115.0 million principal amount of 4.25% Convertible Senior Notes due 2023 (the “Notes”) pursuant to the terms of an Indenture dated as of August 14, 2018 between the Company and Trustee (the “Indenture”) (Capitalized terms used but not defined herein shall have the meanings set forth in the Indenture); 
WHEREAS, the Company entered into an agreement to sell substantially all of its assets through the sale of one of its subsidiaries (the “Transaction”) and the consummation of the Transaction is prohibited under Article 11 of the Indenture unless the Company satisfies certain conditions; and
WHEREAS, in order to satisfy the specified conditions under the Indenture, the Company has duly elected to enter into the Escrow Agreement concurrently with the consummation of the Transaction and cause the Escrow Amount (defined in the Indenture) to be deposited into the Escrow Account (defined below) from the proceeds of the Transaction. 
NOW, THEREFORE, in consideration of the premises, and further consideration of the covenants set forth hereafter, it is hereby agreed mutually as follows:

ARTICLE 1
ESCROW DEPOSIT

1.1.    Receipt of Escrow Property.  

(a)Upon execution of this Escrow Agreement by each party hereto, the Company shall deposit, or shall cause to be deposited, $134,750,000 into a United States Dollar denominated account (the “Escrow Account”) established by the Escrow Agent.  The Escrow Account is set forth below:

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(b)The Escrow Amount is made up of the following amounts: 

		
	(i)
	which is equal to the sum of (A) the aggregate principal amount of the Notes outstanding, (B) accrued and unpaid interest on the Notes (to but not including) the date hereof; (C) the maximum amount of interest payable to holders of the Notes through the Maturity Date (the “Note Escrow Amount”); and

		
	(ii)
	which is equal to the sum of any fees to be owed to the Escrow Agent, the Trustee and their respective agents and counsel through the Maturity Date (including those incurred in connection with the negotiation and delivery of this Agreement), including a reserve amount for the payment of additional amounts that may become due to the Escrow Agent, the Trustee, or their respective agents and counsel under this Agreement or the Indenture, as applicable (the “Expense Reserve Amount”).  The Expense Reserve Amount shall be in addition to (and shall not in any way limit) the obligations that the Company may have under this Escrow Agreement or the Indenture to the Trustee or to the Escrow Agent. 

  
(c)The Escrow Agent will hold the Escrow Amount in the Escrow Account (the “Escrow Property”), in escrow upon the terms and conditions set forth in this Escrow Agreement and shall not disburse funds from the Escrow Account except as provided herein.  The Escrow Agent may, in its discretion, set up sub-accounts for purposes of administering this Agreement.

1.2.    Investment of Funds.  

(a)    The Escrow Agent shall invest the Escrow Property in accordance with the written instructions provided by the Company (signed by an individual designated by the Company on Exhibit B-1) in one of the investments identified on Schedule I (each a “Permitted Investment”).  In the absence of written investment instructions from the Company, the Escrow Agent shall hold the Escrow Property un-invested, without interest thereon.  The Escrow Agent is hereby initially directed by the Company to invest all the Escrow Property in the Permitted Investment identified as (1) on Schedule I.  The Escrow Agent shall invest the Escrow Amount on the date of deposit, provided that it is received on or before 11:00 a.m. New York City time.  Any Escrow Deposit received by the Escrow Agent after 11:00 a.m. New York City time shall be treated as if received on the following business day.  For the avoidance of doubt, any investment earnings and income on the Escrow Property shall become part of the Escrow Property, and shall be disbursed in accordance with Section 1.3 below. The Escrow Agent shall make no disbursement, investment or other use of funds until and unless it has collected funds. The Escrow Agent shall not be liable for collection items until such proceeds have been received or the Federal Reserve has given the Escrow Agent credit for the funds. 

(b)    The Escrow Agent is hereby authorized and directed to sell or redeem any such investments as it deems necessary to make any payments or distributions required under this Escrow Agreement.  The Escrow Agent shall have no responsibility or liability for any loss which may result from any investment or sale of investment made pursuant to this Escrow Agreement.  The Escrow Agent is hereby authorized, in making or disposing of any investment permitted by this Escrow Agreement, to deal with itself (in its individual capacity) or with any one or more of its affiliates, whether it or any such affiliate is acting as agent of the Escrow Agent or for any third person or dealing as principal for its own account.  The Parties acknowledge that the Escrow Agent is not providing investment supervision, recommendations, or advice.

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1.3.    Disbursements.  
(a)The Escrow Agent is hereby directed by the Parties to distribute the Escrowed Property in the following manner:

(i)    from the Note Escrow Amount, as specified by the Company in the Officer’s Certificate and Written Direction, a form of which is attached hereto as Exhibit A-1 (a “Company Written Direction”), delivered to the Trustee and the Escrow Agent two business days prior to the requested distribution date in order to satisfy any of the Company’s monetary obligations under the Indenture to the Holders of the Notes, including payment on the Notes in connection with a Fundamental Change Repurchase in accordance with Article 15 of the Indenture or in connection with a private repurchase or tender offer of the Notes, as described in Section 2.10 of the Indenture;

(ii)    if an Event of Default (defined in the Indenture) has occurred and is continuing, as specified by Trustee in a Trustee Written Direction, a form of which is attached hereto as Exhibit A-2 (a “Trustee Written Direction”), delivered two business days prior to the requested distribution date, in order to satisfy the Company’s monetary obligations under the Indenture for application pursuant to Section 6.05 of the Indenture; or
 
(iii)    the remaining funds in the Escrow Account, including any Expense Reserve Amount, upon the satisfaction in full of the Company’s monetary obligations under the Indenture and this Escrow Agreement and its delivery to the Trustee of an Officer’s Certificate and Opinion of Counsel required under the Indenture, as specified by the Company in the Final Release Written Direction, a form of which is attached hereto as Exhibit A-3 (a “Final Release Written Direction”) delivered to the Trustee and the Escrow Agent at least two business days prior to the requested distribution date.   

The term “Written Direction” may refer, variably, to a Company Written Direction, Trustee Written Direction or Final Release Written Direction, as the context may require).  For the avoidance of doubt, the Company may not use the Expense Reserve Amount to satisfy its obligations to the Noteholders. 

(b)In the event the Escrow Agent makes any payment to any other party pursuant to this Escrow Agreement and for any reason such payment (or any portion thereof) is required to be returned to the Escrow Account or another party or is subsequently invalidated, declared to be fraudulent or preferential, set aside and/or required to be repaid to a receiver, trustee or other party under any bankruptcy or insolvency law, other federal or state law, common law or equitable doctrine, then the recipient shall hold such amounts in trust and shall repay to the Escrow Agent upon written request the amount so paid to it.

(c)The Escrow Agent shall, in its sole discretion, comply with judgments or orders issued or process entered by any court with respect to the Escrow Property, including without limitation any attachment, levy or garnishment, without any obligation to determine such court's jurisdiction in the matter and in accordance with its normal business practices.  If the Escrow Agent complies with any such judgment, order or process, then Escrow Agent shall not be liable to either Party or any other person by reason of such compliance, regardless of the final disposition of any such judgment, order or process.

(d)Each Party understands and agrees that the Escrow Agent shall have no obligation or duty to act upon a Written Direction delivered to the Escrow Agent for the disbursement of Escrow Property under 

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this Escrow Agreement if such Written Direction is not (i) in writing, (ii) signed by, in the case of the Company, any individual designated by the Company on Exhibit B-1 hereto or, in the case of Trustee, any individual designated by Trustee on Exhibit B-2 hereto (in each case, each such individual an “Authorized Representative” of such Party), and (iii) delivered to, and able to be authenticated by, the Escrow Agent in accordance with Section 1.5.

(e)Upon request, the Escrow Agent will furnish monthly statements to each Party setting forth the activity in the Escrow Account.

(f)A party may specify in a Written Direction whether the Escrow Property shall be disbursed by way of wire transfer, check or account to account transfer.  If the written notice for the disbursement of funds does not so specify the disbursement means, the Escrow Agent may disburse the Escrow Property by any means chosen by the Escrow Agent.

1.4.    Written Direction and Other Instruction.

(a)With respect to any Written Direction or any other notice, direction or other instruction required to be delivered by a Party to the Escrow Agent under this Escrow Agreement, the Escrow Agent is authorized to follow and rely upon any and all such instructions given to it from time to time if the Escrow Agent believes, in good faith, that such instruction is genuine and to have been signed by an Authorized Representative of such Party.  The Escrow Agent shall have no duty or obligation to verify that the person who sent such instruction is, in fact, a person duly authorized to give instructions on behalf of a Party, other than to verify that the signature of the Authorized Representative on any such instruction appears to be the signature of such person. Each Party acknowledges and agrees that it is fully informed of the protections and risks associated with the various methods of transmitting instructions to the Escrow Agent, and that there may be more secure methods of transmitting instructions other than the method selected by such Party. The Escrow Agent shall have no responsibility or liability for any loss which may result from:
 
(i)    any action taken or not taken by the Escrow Agent in good faith reliance on any such signatures or instructions;

(ii)    as a result of a Party’s reliance upon or use of any particular method of delivering instructions to the Escrow Agent, including the risk of interception of such instruction and misuse by third parties; or 

(iii) any officer or Authorized Representative of a Party named in an incumbency certificate, Exhibit B-1 or Exhibit B-2 delivered hereunder prior to actual receipt by the Escrow Agent of a more current incumbency certificate or an updated Exhibit B-1 or Exhibit B-2 and a reasonable time for the Escrow Agent to act upon such updated or more current certificate or Exhibit.  

(b)The Company may, at any time, update Exhibit B-1 and Trustee may, at any time, update Exhibit B-2 by signing and submitting to the Escrow Agent an updated Exhibit.  Any updated Exhibit shall not be effective unless the Escrow Agent countersigns a copy thereof.  The Escrow Agent shall be entitled to a reasonable time to act to implement any changes on an updated Exhibit.

1.5.    Delivery and Authentication of Written Direction.

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(a)A Written Direction must be delivered to the Escrow Agent by one of the delivery methods set forth in Section 4.3.

(b)Each Party and the Escrow Agent hereby agree that the following security procedures will be used to verify the authenticity of a Written Direction delivered by any Party to the Escrow Agent under this Escrow Agreement:

(i)    The Written Direction must include the name and signature of the person delivering the disbursement request to the Escrow Agent.  The Escrow Agent will check that the name and signature of the person identified on the Written Direction appears to be the same as the name and signature of an Authorized Representative of such Party; 

(ii)    With respect to a Written Direction delivered by the Company, the Escrow Agent will make a telephone call to an Authorized Representative of the Company purporting to deliver the Written Direction (which Authorized Representative may be the same as the Authorized Representative who delivered the Written Direction) at any telephone number for such Authorized Representative as set forth on Exhibit B-1 to obtain oral confirmation of delivery of the Written Direction; and 

(iii)    With respect to a Written Direction delivered by the Company, if the Written Direction is sent by email to the Escrow Agent, the Escrow Agent also shall review such email address to verify that it appears to have been sent from an email address for an Authorized Representative of such Party as set forth on Exhibit B-1 or from an email address for a person authorized under Exhibit B-1 to email a Written Direction to the Escrow Agent on behalf of the Authorized Representative. 

(c)Each Party acknowledges and agrees that given its particular circumstances, including the nature of its business, the size, type and frequency of its instructions, transactions and files, internal procedures and systems, the alternative security procedures offered by the Escrow Agent and the security procedures in general use by other customers and banks similarly situated, the security procedures set forth in this Section 1.5 are a commercially reasonable method of verifying the authenticity of a payment order in a Written Direction.  

(d)The Escrow Agent is authorized to execute, and each Party expressly agrees to be bound by any payment order in a Written Direction issued in its name (and associated funds transfer) (i) that is accepted by the Escrow Agent in accordance with the security procedures set forth in this Section 1.5, whether or not authorized by such Party and/or (ii) that is authorized by or on behalf of such Party or for which such Party is otherwise bound under the law of agency, whether or not the security procedures set forth in this Section 1.5 were followed, and to debit the Escrow Account for the amount of the payment order.  Notwithstanding anything else, the Escrow Agent shall be deemed to have acted in good faith and without negligence, gross negligence or misconduct if the Escrow Agent is authorized to execute the payment order under this Section 1.5.  Any action taken by the Escrow Agent pursuant to this Section 1.5 prior to the Escrow Agent’s actual receipt and acknowledgement of a notice of revocation, cancellation or amendment of a Written Direction shall not be affected by such notice of revocation, cancellation or amendment of a Written Direction.

(e)The security procedures set forth in this Section 1.5 are intended to verify the authenticity of payment orders provided to the Escrow Agent and are not designed to, and do not, detect errors in the transmission or content of any payment order.  The Escrow Agent is not responsible for detecting an error 

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in the payment order, regardless of whether either Party believes the error was apparent, and the Escrow Agent is not liable for any losses arising from any failure to detect an error.

(f)When instructed to credit or pay a party by both name and a unique numeric or alpha-numeric identifier (e.g. ABA number or account number), the Escrow Agent, and any other banks participating in the funds transfer, may rely solely on the unique identifier, even if it identifies a party different than the party named. Each Party agrees to be bound by the rules of any funds transfer network used in connection with any payment order accepted by the Escrow Agent hereunder.  

(g)The Escrow Agent shall not be obliged to make any payment requested under this Escrow Agreement if it is unable to validate the authenticity of the request by the security procedures set forth in this Section 1.5.  The Escrow Agent’s inability to confirm a payment order may result in a delay or failure to act on that payment order. Notwithstanding anything else in this Escrow Agreement, the Escrow Agent shall not be required to treat a payment order as having been received until the Escrow Agent has authenticated it pursuant to the security procedures in this Section 1.5 and shall not be liable or responsible for any losses arising in relation to such delay or failure to act.

1.6.    Income Tax Allocation and Reporting.  
(a)Each Party agrees that, for tax reporting purposes, the Escrow Property shall be deemed to be the property of the Company and all interest and other income from investment of the Escrow Property shall, as of the end of each calendar year and to the extent required by the Internal Revenue Service, be reported as having been earned by such Party, whether or not such income was disbursed during such calendar year.  Notwithstanding anything to the contrary herein, the Escrow Agent shall have no duty to prepare or file any Federal or state tax report or return with respect to the Escrow Property, except for the delivery and filing of tax information reporting forms required to be delivered and filed with the Internal Revenue Service. With respect to the preparation, delivery and filing of such required tax information reporting forms and all matters pertaining to the reporting of earnings on the Escrow Property, the Escrow Agent shall be entitled to request and receive written instructions from the Company, and the Escrow Agent shall be entitled to rely conclusively and without further inquiry on such written instructions.   With respect to any other payments made under this Escrow Agreement, the Escrow Agent shall not be deemed the payer and shall have no responsibility for performing tax reporting.  The Escrow Agent’s function of making such payments is solely ministerial and upon express direction of the Parties.  
    
(b)Prior to the execution of this Escrow Agreement, or within two days thereafter, the Company shall provide the Escrow Agent with certified tax identification numbers by furnishing appropriate forms W-9 or W-8 and such other forms and documents that the Escrow Agent may request.   The Company understands that if such tax reporting documentation is not provided and certified to the Escrow Agent, the Escrow Agent may be required by the Internal Revenue Code of 1986, as amended, and the regulations promulgated thereunder, to withhold a portion of any interest or other income earned on the investment of the Escrow Property.

(c)To the extent that the Escrow Agent becomes liable for the payment of any taxes in respect of income derived from the investment of the Escrow Property, the Escrow Agent shall satisfy such liability to the extent possible from the Escrow Property.  The Company shall  indemnify, defend and hold the Escrow Agent harmless from and against any tax, late payment, interest, penalty or other cost or expense that may be assessed against the Escrow Agent on or with respect to the Escrow Property and the investment thereof unless such tax, late payment, interest, penalty or other expense was finally adjudicated to have been directly caused by the gross negligence or willful misconduct of the Escrow Agent.  The indemnification provided 

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by this Section 1.6(c) is in addition to the indemnification provided in Section 3.1 and shall survive the resignation or removal of the Escrow Agent and the termination of this Escrow Agreement.

1.7.    Termination.  Unless earlier terminated by the Parties, this Escrow Agreement shall terminate upon the satisfaction and discharge of the Indenture, at which time the Escrow Agent is authorized and directed to disburse the Escrow Property in accordance with Section 1.3 (Disbursements) and this Escrow Agreement shall be of no further force and effect, except that the provisions of Sections 1.6 (Tax Allocation and Reporting), 3.1(Indemnification) and 3.2 (Limitation of Liability) hereof shall survive termination.

ARTICLE 2 
DUTIES OF THE ESCROW AGENT

2.1.    Scope of Responsibility.  Notwithstanding any provision to the contrary, the Escrow Agent is obligated only to perform the duties expressly and specifically set forth in this Escrow Agreement, which shall be deemed purely ministerial in nature.  Under no circumstances will the Escrow Agent be deemed to be a fiduciary to either Party or any other person under this Escrow Agreement or otherwise.  The Escrow Agent will not be responsible or liable for the failure of either Party to perform in accordance with this Escrow Agreement. The Escrow Agent shall neither be responsible for, nor chargeable with, knowledge of the terms and conditions of any other agreement, instrument, or document other than this Escrow Agreement, whether or not an original or a copy of such agreement has been provided to the Escrow Agent; and the Escrow Agent shall have no duty to know or inquire as to the performance or nonperformance of any provision of any such agreement, instrument, or document.  References in this Escrow Agreement to any other agreement, instrument, or document are for the convenience of the parties and the Escrow Agent has no duties or obligations with respect thereto. The Escrow Agent acts hereunder as escrow agent only, and is not responsible or liable in any manner whatsoever for the sufficiency, correctness, genuineness or validity of the subject matter of this Escrow Agreement or any part thereof. The Escrow Agent shall have no responsibilities (except as expressly set forth herein) as to the validity, sufficiency, value, genuineness, ownership or transferability of the Escrow Property, written instructions, or any other documents in connection therewith, and will not be regarded as making nor be required to make, any representations thereto. This Escrow Agreement sets forth all matters pertinent to the escrow contemplated hereunder, and no additional obligations of the Escrow Agent shall be inferred or implied from the terms of this Escrow Agreement, any other agreement or otherwise. 

2.2.    Rights of the Escrow Agent. No provision of this Escrow Agreement shall require the Escrow Agent to expend or risk its own funds or otherwise incur any financial liability or potential financial liability in the performance of its duties or the exercise of its rights under this Escrow Agreement. The Escrow Agent shall not be obligated to take any legal action or to commence any proceedings in connection with this Escrow Agreement or any property held hereunder or to appear in, prosecute or defend in any such legal action or proceedings. The Escrow Agent shall be protected in acting upon any written instruction, notice, request, waiver, consent, certificate, receipt, authorization, power of attorney or other paper or document which the Escrow Agent in good faith believes to be genuine and what it purports, to be, including, but not limited to, items directing investment or non-investment of funds, items requesting or authorizing release, disbursement or retainage of the subject matter of this Escrow Agreement and items amending the terms of this Escrow Agreement.

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2.3.    Attorneys and Agents.  The Escrow Agent shall be entitled to rely on and shall not be liable for any action taken or omitted to be taken by the Escrow Agent in accordance with the advice of counsel or other professionals retained or consulted by the Escrow Agent.  The Escrow Agent shall be reimbursed as set forth in Section 3.1 for any and all compensation (fees, expenses and other costs) paid and/or reimbursed to such counsel and/or professionals.  The Escrow Agent may perform any and all of its duties through its agents, representatives, attorneys, custodians, and/or nominees and shall not be responsible for the acts or omissions of such agents, representatives, attorneys, custodians or nominees appointed with due care.

2.4.    Right Not Duty Undertaken.  The permissive rights of the Escrow Agent to do things enumerated in this Escrow Agreement shall not be construed as duties.
 
ARTICLE 3 
PROVISIONS CONCERNING THE ESCROW AGENT

3.1    Indemnification.  The Company hereby indemnifies and defends the Escrow Agent and its directors, officers, employees and agents (collectively, the “Indemnified Parties”), and holds the Indemnified Parties harmless from any and against all liabilities, losses, actions, suits or proceedings at law or in equity, and any other expenses, fees or charges of any character or nature, (including, without limitation, attorney's fees and expenses and the costs of enforcement of this Escrow Agreement or any provision thereof), which an Indemnified Party may incur or with which it may be threatened by reason of acting as or on behalf of the Escrow Agent under this Escrow Agreement or arising out of the existence of the Escrow Account, except to the extent the same shall be have been finally adjudicated to have been directly caused by the Escrow Agent's gross negligence or willful misconduct.  The Escrow Agent shall have a first lien against the Escrow Account to secure the obligations of the parties hereunder.  The terms of this paragraph shall survive termination of this Escrow Agreement.  

3.2.    Limitation of Liability.  THE ESCROW AGENT SHALL NOT BE LIABLE, DIRECTLY OR INDIRECTLY, FOR ANY (I) DAMAGES, LOSSES OR EXPENSES ARISING OUT OF OR IN CONNECTION WITH THIS ESCROW AGREEMENT, THE ESCROW ACCOUNT, THE ESCROW PROPERTY, OR THE SERVICES PROVIDED HEREUNDER, OTHER THAN DAMAGES, LOSSES OR EXPENSES WHICH HAVE BEEN FINALLY ADJUDICATED TO HAVE DIRECTLY RESULTED FROM THE ESCROW AGENT’S GROSS NEGLIGENCE OR WILLFUL MISCONDUCT, (II) SPECIAL, INDIRECT OR CONSEQUENTIAL DAMAGES OR LOSSES OF ANY KIND WHATSOEVER (INCLUDING WITHOUT LIMITATION LOST PROFITS), EVEN IF THE ESCROW AGENT HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH LOSSES OR DAMAGES AND REGARDLESS OF THE FORM OF ACTION, OR (III) ANY AMOUNT IN EXCESS OF THE VALUE OF THE ESCROW PROPERTY.

3.3.    Resignation or Removal.  The Escrow Agent may, at any time, resign as escrow agent hereunder by furnishing written notice of its resignation to each Party. At such time, all fees and expenses to which the Escrow Agent is entitled shall be immediately due and payable to Escrow Agent. The Parties may remove the Escrow Agent by furnishing to the Escrow Agent a joint written notice of its removal along with payment of all fees and expenses to which it is entitled through the date of termination.  Such resignation or removal, as the case may be, shall be effective thirty (30) days after the delivery of such notice or upon the earlier appointment of a successor, and the Escrow Agent’s sole responsibility thereafter shall be to safely keep the Escrow Property and to deliver the same to a successor escrow agent as shall be appointed by the Parties, 

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as evidenced by a joint written notice filed with the Escrow Agent or in accordance with a court order.  If the Parties have failed to appoint a successor escrow agent prior to the expiration of thirty (30) days following the delivery of such notice of resignation or removal, the Escrow Agent shall be entitled, at its sole discretion and at the expense of the Company, to (a) return the Escrow Property to the Company, or (b) petition any court of competent jurisdiction for the appointment of a successor escrow agent or for other appropriate relief, and any such resulting appointment shall be binding upon the Parties.

3.4.    Compensation and Security Interest.  
    
(a)  The Escrow Agent shall be entitled to compensation for its services as stated in the fee schedule attached hereto as Exhibit C, which compensation shall be paid by the Company.  Such compensation is intended for the Escrow Agent's services as contemplated by this Escrow Agreement. In addition to such compensation, in the event that the conditions for the disbursement of funds under this Escrow Agreement are not fulfilled, or the Escrow Agent renders any service not contemplated in this Escrow Agreement, or there is any assignment of interest in the subject matter of this Escrow Agreement, or any material modification hereof, or if any material controversy arises hereunder, or the Escrow Agent is made a party to any litigation pertaining to this Escrow Agreement or the subject matter hereof, then the Escrow Agent shall be compensated for such extraordinary services and any services or work performed by Escrow Agent in connection with any delay, controversy, litigation or event, and reimbursed for all costs and expenses, including reasonable attorneys’ fees and expenses, occasioned by any such delay, controversy, litigation or event.  If any amount due to the Escrow Agent hereunder is not paid within thirty (30) days of the date due, the Escrow Agent in its sole discretion may charge interest on such amount up to the highest rate permitted by applicable law.  

		
	(b)
	As security for the due and punctual performance of any and all of the Company’s obligations under the Indenture and to the Escrow Agent hereunder, now or hereafter arising, the Company, hereby pledges, assigns and grants to the Trustee, for the benefit of the Holders (defined in the Indenture), Trustee and Escrow Agent a continuing security interest in, and a lien on and right of setoff against, the Escrow Property and all distributions thereon or additions thereto (whether such additions are the result of deposits by the Company or otherwise).  If any fees, expenses or costs incurred by, or any obligations owed to, the Trustee or Escrow Agent under the Indenture or hereunder are not promptly paid when due, the Escrow Agent may reimburse the Trustee and itself therefor from the Escrow Property, and may sell, convey or otherwise dispose of any Escrow Property for such purpose.  The security interest and setoff rights of the Trustee, for the benefit of the Holders, Trustee and Escrow Agent shall at all times be valid, perfected and enforceable by the Escrow Agent against the Parties and all third parties in accordance with the terms of this Escrow Agreement.  

		
	(c)
	The Escrow Agent and the Parties agree that the Escrow Account is a “deposit account” within the meaning of Article 9 of the Uniform Commercial Code of the State of Delaware (the “UCC”). It is the intent of the parties to this Agreement that the Trustee shall have control over the Escrow Account within the meaning of Section 9-104 of the UCC. Upon receipt of a Trustee Written Direction, the Escrow Agent agrees to comply with written instructions or directions concerning the Escrow Account or the disposition of funds in the Escrow Account originated by the Trustee without further consent by the Company. 

The terms of this Section 3.4 shall survive termination of this Escrow Agreement. 

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3.5.    Disagreements.  If any conflict, disagreement or dispute arises between, among, or involving any of the parties hereto concerning the meaning or validity of any provision hereunder or concerning any other matter relating to this Escrow Agreement, or the Escrow Agent is in doubt as to the action to be taken hereunder, the Escrow Agent may, at its option, refuse to act until the Escrow Agent (a) receives a final non-appealable order of a court of competent jurisdiction directing delivery of the Escrow Property or (b) receives a written instruction, executed by each of the parties involved in such disagreement or dispute, in a form reasonably acceptable to the Escrow Agent, directing delivery of the Escrow Property.  The Escrow Agent will be entitled to act on any such written instruction or final, non-appealable order of a court of competent jurisdiction without further question, inquiry or consent.  The Escrow Agent may file an interpleader action in a state or federal court, and upon the filing thereof, the Escrow Agent will be relieved of all liability as to the Escrow Property and will be entitled to recover reasonable and documented out-of-pocket attorneys’ fees, expenses and other costs incurred in commencing and maintaining any such interpleader action.    In the event the Escrow Agent receives conflicting instructions hereunder, the Escrow Agent shall be fully protected in refraining from acting until such conflict is resolved to the satisfaction of the Escrow Agent. 

3.6.    Merger or Consolidation.  Any corporation or association into which the Escrow Agent may be converted or merged, or with which it may be consolidated, or to which it may sell or transfer all or substantially all of its corporate trust business and assets as a whole or substantially as a whole, or any corporation or association resulting from any such conversion, sale, merger, consolidation or transfer to which the Escrow Agent is a party, shall be and become the successor escrow agent under this Escrow Agreement and shall have and succeed to the rights, powers, duties, immunities and privileges as its predecessor, without the execution or filing of any instrument or paper or the performance of any further act.

3.7.    Attachment of Escrow Property; Compliance with Legal Orders.  In the event that any Escrow Property shall be attached, garnished or levied upon by any court order, or the delivery thereof shall be stayed or enjoined by an order of a court, or any order, judgment or decree shall be made or entered by any court order affecting the Escrow Property, the Escrow Agent is hereby expressly authorized, in its sole discretion, to respond as it deems appropriate or to comply with all writs, orders or decrees so entered or issued, or which it is advised by legal counsel of its own choosing is binding upon it, whether with or without jurisdiction.  In the event that the Escrow Agent obeys or complies with any such writ, order or decree it shall not be liable to any Party or to any other person, firm or corporation, should, by reason of such compliance notwithstanding, such writ, order or decree be subsequently reversed, modified, annulled, set aside or vacated.

3.8.    Force Majeure.  The Escrow Agent shall not be responsible or liable for any failure or delay in the performance of its obligation under this Escrow Agreement arising out of or caused, directly or indirectly, by circumstances beyond its reasonable control, including, without limitation, acts of God; earthquakes; fire; flood; wars; acts of terrorism; civil or military disturbances; sabotage; epidemic; riots; interruptions; loss or malfunctions of utilities including but not limited to, computer (hardware or software), payment systems, or communications services; accidents; labor disputes; acts of civil or military authority or governmental action; it being understood that the Escrow Agent shall use commercially reasonable efforts which are consistent with accepted practices in the banking industry to resume performance as soon as reasonably practicable under the circumstances.

3.9.    Compliance with Legal Orders.  The Escrow Agent shall be entitled to consult with legal counsel in the event that a question or dispute arises with regard to the construction of any of the provisions hereof, 

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and shall incur no liability and shall be fully protected in acting in accordance with the advice or opinion of such counsel.

3.10.    No Financial Obligation. The Escrow Agent shall not be required to use its own funds in the performance of any of its obligations or duties or the exercise of any of its rights or powers, and shall not be require to take any action which, in the Escrow Agent's sole and absolute judgment, could involve it in expense or liability unless furnished with security and indemnity which it deems, in its sole and absolute discretion, to be satisfactory.

ARTICLE 4 
MISCELLANEOUS

4.1    Successors and Assigns.  This Escrow Agreement shall be binding on and inure to the benefit of each Party and the Escrow Agent and their respective successors and permitted assigns. No other persons shall have any rights under this Escrow Agreement.  No assignment of the interest of any of the Parties and the Escrow Agent shall be binding unless and until written notice of such assignment shall be delivered to the other Party and the Escrow Agent and shall require the prior written consent of the other Party and the Escrow Agent (such consent not to be unreasonably withheld).

4.2.    Escheat.  Each Party is aware that under applicable state law, property which is presumed abandoned may under certain circumstances escheat to the applicable state.  The Escrow Agent shall have no liability to either Party or any other party, should any or all of the Escrow Property escheat by operation of law.

4.3.    Notices.  All notices, requests, demands, and other communications required under this Escrow Agreement shall be in writing, in English, and shall be deemed to have been duly given if delivered (i) personally, (ii) by facsimile transmission with written confirmation of receipt, (iii) by overnight delivery with a reputable national overnight delivery service, (iv) by mail or by certified mail, return receipt requested, and postage prepaid, or (v) by electronic transmission; including by way of e-mail (as long as such email is accompanied by a PDF or similar version of the relevant document bearing the signature of an Authorized Representative for the Party sending the notice) with email confirmation of receipt.  If any notice is mailed, it shall be deemed given five business days after the date such notice is deposited in the United States mail.  If notice is given to a party, it shall be given at the address for such party set forth below.  It shall be the responsibility of each Party to notify the Escrow Agent in writing of any name or address changes.  In the case of communications delivered to the Escrow Agent, such communications shall be deemed to have been given on the date received by the Escrow Agent.

If to the Company:

NII Holdings, Inc.
12110 Sunset Hills Road, Suite 600
Reston, Virginia  20190
Attention:  Shana C. Smith
Telephone: (703) 390-5100    
Email address: shana.smith@nii.com  

If to Trustee:

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Wilmington Trust, National Association
246 Goose Lane, Suite 105
Guilford, CT 06437Attention:  NII Holdings, Inc. - Escrow Account
Telephone: 203-453-4094    
Facsimile:  203-453-1183
Email address: NSUTTON@wilmingtontrust.com      

If to the Escrow Agent:

Wilmington Trust, National Association
246 Goose Lane, Suite 105
Guilford, CT 06437 Attn: NII Holdings, Inc., Escrow Account
Facsimile: 203-453-1183
Email address:  NSUTTON@wilmingtontrust.com      
    

4.4.    Governing Law.  This Escrow Agreement shall be governed by and construed in accordance with the laws of the State of Delaware without regard to any laws relating to choice of laws (whether of the State of Delaware or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the State of Delaware.  

4.5.    Venue.      Each Party and the Escrow Agent hereby consent to the exclusive personal jurisdiction of the courts located in New Castle County in the State of Delaware in the event of a dispute arising out of or under this Escrow Agreement.  Each Party and the Escrow Agent hereby irrevocably waives any objection to the laying of the venue of any suit, action or proceeding and irrevocably submits to the exclusive jurisdiction of such court in such suit, action or proceeding.  

4.6.    Entire Agreement.  This Escrow Agreement and the exhibits hereto set forth the entire agreement and understanding of the parties related to the Escrow Property and supersedes all prior agreements and understandings, oral or written.  If a court of competent jurisdiction declares a provision invalid, it will be ineffective only to the extent of the invalidity, so that the remainder of the provision and Escrow Agreement will continue in full force and effect.  In the event of any direct conflict of the terms of this Escrow Agreement with the terms of the Indenture, as with respect to the rights of the Company and Trustee, the terms of the Indenture shall control and prevail; provided, in no event shall the Escrow Agent be bound by the terms of the Indenture.  This Escrow Agreement is not intended to confer upon any person other than the parties hereto any rights or remedies. 

4.7.    Amendment.  This Escrow Agreement may be amended, modified, supplemented, superseded, rescinded, or canceled only by a written instrument executed by the Parties and the Escrow Agent; provided that Exhibit B-1 or Exhibit B-2, as applicable, may be amended at any time in accordance with Section 1.4. 

4.8.    Waivers.  The failure of any party to this Escrow Agreement at any time or times to require performance of any provision under this Escrow Agreement shall in no manner affect the right at a later time to enforce the same performance.  A waiver by any party to this Escrow Agreement of any such condition or breach of any term, covenant, representation, or warranty contained in this Escrow Agreement, in any one or more instances, shall neither be construed as a further or continuing waiver of any such condition or 

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breach nor a waiver of any other condition or breach of any other term, covenant, representation, or warranty contained in this Escrow Agreement.

4.9.    Interpretation.  Section headings of this Escrow Agreement have been inserted for convenience of reference only and shall in no way restrict or otherwise modify any of the terms or provisions of this Escrow Agreement. Unless otherwise indicated by the context, the singular shall include the plural and the plural shall include the singular.  Any references to an Exhibit is a reference to an Exhibit of this Escrow Agreement.

4.10.    Counterparts.  This Escrow Agreement may be executed in one or more counterparts, each of which when executed shall be deemed to be an original, and such counterparts shall together constitute one and the same instrument.

4.11.    Waiver of Jury Trial. EACH OF THE PARTIES HERETO EXPRESSLY WAIVES THE RIGHT TO TRIAL BY JURY IN RESOLVING ANY CLAIM OR COUNTERCLAIM RELATING TO OR ARISING OUT OF THIS ESCROW AGREEMENT.

 

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IN WITNESS WHEREOF, this Escrow Agreement has been duly executed as of the date first written above. 

NII HOLDINGS, INC. 

By:     
Name: 
Title:
Date:

WILMINGTON TRUST, NATIONAL ASSOCIATION, as Trustee

By:     
Name: 
Title:
Date:

WILMINGTON TRUST, NATIONAL ASSOCIATION, as Escrow Agent

By:     
Name: 
Title:
Date:

14

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