May 6, 2002SAN DIEGO
Qualcomm products mentioned within this press release are offered by Qualcomm Technologies, Inc. and/or its subsidiaries.
SAN DIEGO -- May 6, 2002 -- Qualcomm Incorporated (Nasdaq: QCOM), pioneer and world leader of Code Division Multiple Access (CDMA) digital wireless technology, today announced the signing of definitive agreements by and among Telefónica Móviles, S.A., Pegaso Telecomunicaciones, S.A. de C.V. ("Pegaso"), its shareholders, Qualcomm, certain creditors of Pegaso and its subsidiaries and other interested parties. Pegaso is a wireless telecommunications operator in Mexico. Pursuant and subject to the terms and conditions of the definitive agreements, Telefónica will acquire 65 percent of Pegaso's equity from existing shareholders and the Burillo Group would continue to own 35 percent.
The consummation of the contemplated acquisition and the repayment after the closing of a portion of the Pegaso companies' outstanding indebtedness owed to Qualcomm are subject to satisfaction of the conditions precedent set forth in the definitive agreements. These conditions include, among other things, obtaining various regulatory and other approvals. The definitive agreements provide for the repayment in full of all interim financing advanced or to be advanced by Qualcomm to Pegaso. Qualcomm has committed to provide up to $140 million, on a net basis, of such interim financing, some of which has already been funded. In addition, Qualcomm is to receive cash payment of a portion of its existing secured loans to Pegaso. Upon the consummation of these transactions and exclusive of the repayment of the interim financing, Qualcomm's secured debt in the Pegaso companies will be reduced in excess of $200 million. The balance of Qualcomm's senior secured debt to Pegaso will remain in place to support Telefónica's expanded Mexican operations and is to be repaid in accordance with amended credit documents.
"We are pleased that Telefónica Móviles, which is recognized as one of the world's leading wireless operators, is putting its considerable financial strength and operations expertise behind Pegaso to achieve a successful nationwide CDMA network in Mexico," said Tony Thornley, president and chief operating officer of Qualcomm.
Qualcomm Incorporated (www.qualcomm.com) is a leader in developing and delivering innovative digital wireless communications products and services based on the Company's CDMA digital technology. Headquartered in San Diego, Calif., Qualcomm is included in theS&P500 Index and traded on The Nasdaq Stock Market® under the ticker symbol QCOM.
Except for the historical information contained herein, this news release contains forward-looking statements that are subject to risks and uncertainties, including the subject transaction receiving necessary regulatory approvals and the other terms and conditions set forth in the definitive agreements being timely satisfied, the timely performance by the subject parties of their respective obligations under the subject agreements, and the ability of Telefónica Móviles to successfully operate a Mexican wireless network, as well as the other risks detailed from time to time in the Company's SEC reports, including the report on Form 10-K for the year ended September 30, 2001, and most recent Form 10-Q.