Exhibit 8
Letter Agreement in Principle, dated as of February 13, 2001, by and among
America Online Latin America, Inc. and America Online, Inc., Aspen Investments
LLC, Atlantis Investments LLC, Banco Itau, S.A. Cayman Branch and Itau Bank
Limited.
February 13, 2001
America Online, Inc.
00000 XXX Xxx
Xxxxxx, XX 00000-0000
Aspen Investments LLC
Atlantis Investments LLC
c/o Finser Corporation
000 Xxxxxxxx Xxx, Xxxxx 000
Xxxxx Xxxxxx, XX 00000
Banco Itau, S.A.-Cayman Branch
Itau Bank Limited
Xxx Xxx Xxxxx 000
Xxx Xxxxx, Xxxxxx
Ladies and Gentlemen:
This letter is intended to confirm the agreement by and among America
Online Latin America, Inc. ("AOLA") and each of America Online, Inc. ("AOL"),
Aspen Investments LLC and Atlantis Investments LLC (collectively, "ODC") and
Banco Itau, S.A.-Cayman Branch and Itau Bank Limited (collectively, "Banco
Itau," and together with AOL and ODC, the "Purchasers") regarding the proposed
sale of equity securities of AOLA to each of AOL, ODC and Banco Itau.
Each of the Purchasers agrees to contribute to the capital of AOLA the
amounts set forth opposite its respective name on the term sheet attached hereto
as Exhibit A and agrees to the other terms set forth therein. Counsel for AOLA
will prepare the definitive draft documents necessary to implement this
agreement, including without limitation (the "Definitive Documents"):
o purchase agreement(s),
o a certificate of designation for the Series D Preferred Stock and, if
necessary, an amendment to AOLA's Certificate of Incorporation,
o amendments to the Stockholders' Agreement and Registration Rights
Agreement among AOLA, AOL and ODC, and
o an amendment to the existing Registration Rights and Stockholders'
Agreement between AOLA and Banco Itau (pursuant to such amendment,
among other things, Banco Itau will have the right to effect repurchase
transactions at its sole discretion with respect to all or any part of
the securities to be purchased hereunder on the terms and conditions to
be agreed to in the Definitive Documents).
Each of the parties acknowledges and agrees that it will proceed in good
faith in negotiating the Definitive Documents, which may include refinements and
clarifications of the terms and conditions set forth on Exhibit A, as well as
additional terms that, although not specified herein, are customary in equity
investments of this type and consistent with the existing documents evidencing
the Purchasers' current investments in AOLA; provided, that if the Definitive
Documents are not executed on or prior to April 15, 2001, this letter agreement
shall terminate; provided, further, that such termination shall not relieve any
party from liability for any obligation it may have failed to perform prior to
such termination.
The signing of the definitive agreements will be conditioned on the Board
of Directors of AOLA having approved this transaction (which will require, at a
minimum, that the Board receive a favorable recommendation to the Board of
Directors by a special committee of the Board constituted to advise the Board on
this transaction (which committee will seek a "fairness opinion" from an
investment bank to be retained by that committee)). The equity securities will
be issued by AOLA to the Purchasers pursuant to Regulations D and S promulgated
under the Securities Act of 1933, as amended.
AOLA shall reimburse each Purchaser in an amount not to exceed US$25,000
per Purchaser for legal fees and other out-of-pocket expenses incurred by such
Purchaser in connection with the negotiation and execution of this letter and
the transactions described herein, whether or not the transactions described
herein are completed. Except as set forth in the preceding sentence, all parties
shall be responsible for their own costs and expenses.
This agreement shall be governed by, and construed and enforced in
accordance with, the laws of the State of Delaware and may be modified only
pursuant to a writing signed by all of the parties hereto.
If you determine that the foregoing is satisfactory in principle, we would
appreciate acknowledgment of that determination by the execution and delivery to
us of the enclosed copy of this letter.
Very truly yours,
America Online Latin America, Inc.
By: /s/ Xxxxxxx X. Xxxxxxxxx
Xxxxxxx X. Xxxxxxxxx
President and Chief Executive Officer
The foregoing is agreed to and accepted.
America Online, Inc.
By: /s/ Xxxxxx X. Xxxxx, Xx.
Xxxxxx X. Xxxxx, Xx.
Senior Vice President
Dated, February 13, 2001
Aspen Investments LLC
By: /s/ Xxxxxxxx Xxxxxxxx /s/ Xxxx Xxxxxx Jenn
Xxxxxxxx Xxxxxxxx Xxxx Xxxxxx Jenn
Executive Vice President Secretary
Dated, February 13, 2001
Atlantis Investments LLC
By:/s/ Xxxxxxxx Xxxxxxxx /s/ Xxxx Xxxxxx Jenn
Xxxxxxxx Xxxxxxxx Xxxx Xxxxxx Jenn
Executive Vice President Secretary
Dated, February 13, 2001
Banco Itau, S.A.-Cayman Branch
By: /s/ Xxxxxxx Egydio Setubal
Xxxxxxx Egydio Setubal
President
Dated, February 13, 2001
Itau Bank Limited
By: /s/ Xxxxxxx Egydio Setubal
Xxxxxxx Egydio Setubal
President
Dated, February 13, 2001
Exhibit A
Term Sheet
America Online Latin America, Inc.
Capital Contribution and Subscription for New Shares
Issuer . . . . . . . . . America Online Latin America, Inc. (the "Company"), a
Delaware corporation.
Purchasers . . . . . . . A. America Online, Inc. ("AOL"), a Delaware
corporation.
B. Banco Itau, S.A.-Cayman Branch and Itau Bank
Limited (collectively "Itau").
C. Aspen Investments LLC, and Atlantis Investments
LLC, each a Delaware limited liability company
(collectively "ODC").
Capital Contributions . . A. AOL: US$ 66,338,075;
B. Itau: US$ 19,864,875;
C. ODC: US$ 63,797,050.
Securities . . . . . . . A. AOL: Series D Preferred Stock (each share of
which will be convertible into one share of "High
Vote Common Stock" (as defined in AOLA's current
Certificate of Incorporation))with a liquidation
preference equal to the amount of AOL's Capital
Contributions hereunder, ranking senior (in
liquidation, but not with respect to dividends) to
other classes of the Company's Preferred Stock, with
voting rights equal to those of the Company's other
Preferred Stock and with a dividend rate equal to 3%
of the per share liquidation preference (on terms
consistent with, and pari passu with, the Company's
other Preferred Stock);
B. Itau: Class A Common Stock;
C. ODC: Series C Preferred Stock.
Purchase Price . . . . . For each share of each of the above classes of
stock, the average of the closing price of the Class
A Common Stock quoted on the Nasdaq National Market
System as published in the Wall Street Journal for a
certain number of trading days prior to the
initial funding date as may be agreed to by the
parties and specified in the Definitive Documents.
Target Closing Date . . . March 8, 2001
Payment Schedules . . . . Capital will be contributed in an aggregate amount
of $150 million on the following dates: (i) April
1, 2001, (ii) June 1, 2001 and (iii)August 1, 2001.
The amount to be contributed on each funding date
will be set forth in the Definitive Documents and
will be based on the projected cash needs of AOLA
(plus an agreed upon "cushion") as demonstrated
by a business plan to be finalized prior to the
execution of the Definitive Documents; provided,
that the Definitive Documents will provide that
notwithstanding the definitive amounts established for
each funding date, the Purchasers shall fund such
additional amounts as may be needed by AOLA (subject
to the aggregate limit of $150 million). On each
funding date, (a) AOL, Itau and ODC will each make a
capital contribution in an amount equal to their
respective pro rata portions of the aggregate amount
required to be contributed on such funding date,
and (b) in exchange therefor the Company will issue
to each such entity the applicable number of
shares of the Company's capital stock.
Definitive Agreements . Purchase Agreement among the Company and the
Purchasers, amendment to the Stockholders Agreement
and the Registration Rights Agreement among the
Company, AOL and ODC (to make the newly issued
securities subject to that agreement) and amendment to
the Registration Rights and Stockholders Agreement
between the Company and Itau (to make the newly issued
securities subject to that agreement as "Unrestricted
Shares", other than Section 10.1(a) and 10.1(b)(i);
provided, that the documents will provide that (A) all
public sales of the securities will be subject to
Section 10.1(e)(ii) and (B) all private sales of the
securities will be subject to Section 10.1(e)(iii) and
a right of first refusal in favor of AOLA, AOL and
ODC).
Confidentiality . . . . . The terms of this Term Sheet, the Parties' discussions
and their subject matter are confidential and shall be
disclosed only to the Parties' employees and outside
advisors who have a need to know such confidential
information, except as required by law or with the
prior written consent of all the Parties hereto.
