2015 11:27 PM

THIS EXHIBIT MARKED “SCHEDULE A”

REFERRED TO IN

THE AFFIRMATION

OF SERVICE

DATED 18 JUNE 2015

FILED: NEW YORK COUNTY CLERK 06/22/2015 11:27 PM INDEX NO. 652890/2014

NYSCEF DOC. NO. 131 RECEIVED NYSCEF: 06/22/2015

1 BOS 47614185v1

SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF NEW YORK ---------------------------------------------------------------------x UNIVERSAL INVESTMENT ADVISORY SA; UNIVERSAL ABSOLUTE RETURN SP; VAQUERO MASTER EM CREDIT FUND LTD., HARSHIL KANTILAL KOTHARI; FOOTBRIDGE CAPITAL, LLC; GROWTH CREDIT FUND IC; Plaintiffs,

v.

BAKRIE TELECOM PTE, LTD., PT BAKRIE TELECOM TBK, PT BAKRIE NETWORK, PT BAKRIE CONNECTIVITY, PT BAKRIE & BROTHERS TBK, ANINDYA NOVYAN BAKRIE, FREDERIK JOHANES MEIJER, MUHAMMAD BULDANSYAH, JULIANDUS A LUMBAN TOBING, RAKHMAT JUNAIDI, JASTIRO ABI , GAFUR SULISTYO UMAR, AI MULYADI MAMOER, RAJSEKAR KUPPUSWAMI MITTA, NALINKANT A RATHOD, AMBONO JANURIANTO, AMIT BOSE, BACHDER BACHTARUDIN, HARYA MITRA HIDAYAT, IMANUDDIN KENCANA PUTRA, RINI MARIANO SOEMARNO, EKA ANWAR, Defendants.

: : : : : : : : : : : : : : : : : : : : : : : : : : : : : : : : : : :

Index No. 652890/2014 Date Purchased: September 22, 2014 (Hon. Saliann Scarpulla) SUPPLEMENTAL SUMMONS Plaintiffs designate New York County as the place of trial. The basis of venue is CPLR §§ 501 and 509.

---------------------------------------------------------------------x TO THE ABOVE NAMED DEFENDANTS:

YOU ARE HEREBY SUMMONED to answer the Second Amended Complaint in this

action and to serve a copy of your answer, or, if the Second Amended Complaint is not served



2

with this summons, to serve a notice of appearance on the plaintiffs' attorneys within twenty (20)

days after the service of this summons, exclusive of the day of service (or within thirty (30) days

after service is complete if this summons is not personally delivered to you within the State of

New York); and in case of your failure to appear or answer, judgment will be taken against you

by default for the relief demanded in the complaint.

PLEASE TAKE FURTHER NOTICE that venue in this action is placed in New York

County because the parties have consented to venue in this County, and plaintiffs designate New

York County as the place of trial.

Dated: New York, New York February 20, 2015 GREENBERG TRAURIG, LLP

By: /s/ Gary Greenberg Gary Greenberg GREENBERG TRAURIG, LLP One International Place Boston, MA 02110 Tel: (617) 310-6000 Email: [email protected] James W. Perkins, Esq. John J. Elliott, Esq. 200 Park Avenue MetLife Building, 38th floor New York, New York 10166 (212) 801-9200 Email: [email protected]

[email protected]

3

- and - Hal Hirsch, Esq. 600 Madison Avenue New York, New York 10022 Tel: (212) 763-9790

Attorneys for Plaintiffs Universal Investment Advisory SA, Universal Absolute Return SP, Vaquero Master EM Credit Fund, Ltd., Harshil Kantilal Kothari, Footbridge Capital, LLC, and Growth Credit Fund IC

TO: BAKRIE TELECOM PTE, LTD., PT BAKRIE NETWORK, PT BAKRIE

CONNECTIVITY, PT BAKRIE TELECOM TBK c/o Designated Agent for Service of Process Law Debenture Corporate Services 400 Madison Avenue New York, New York 10017 TO: PT BAKRIE & BROTHERS TBK. 35th Floor, Bakrie Tower, Rasuna Epicentrum Complex Jl. H.R Rasuna Said Jakarta 12940, Indonesia TO: ANINDYA NOVYAN BAKRIE c/o PT Bakrie Telecom Tbk.

4th Floor, Wisma Bakrie, Jl. H. R. Rasuna Said Kav. B-1 Jakarta Selatan 12920, Indonesia

TO: FREDERIK JOHANNES MEIJER 16th Floor, Gedung Citicon

Jl. S. Parman Kav. 71 Jakarta Barat 11410, Indonesia

TO: MUHAMMAD BULDANSYAH 50th Floor, Wisma Mulia

Jl. Jend. Gatot Subroto No. 42 Jakarta 12710, Indonesia

TO: JULIANDUS ASI LUMBAN TOBING Ground Floor, Komplek Rasuna Epicentrum Lot 9 Jl. H.R Rasuna Said Jakarta 12940, Indonesia

4

TO: RAKHMAT JUNAIDI

c/o PT Bakrie Telecom Tbk. 4th Floor, Wisma Bakrie, Jl. H. R. Rasuna Said Kav. B-1 Jakarta Selatan 12920, Indonesia

TO: JASTIRO ABI c/o PT Bakrie Telecom Tbk.


TO: BOBBY GAFUR SULISTYO UMAR


TO: AI MULYADI MAMOER


TO: RAJSEKAR KUPPUSWAMI MITTA c/o PT Bakrie Telecom Tbk. 4th Floor, Wisma Bakrie, Jl. H. R. Rasuna Said Kav. B-1 Jakarta Selatan 12920, Indonesia

TO: NALINKANT AMRATLAL RATHOD 39th Floor, Bakrie Tower, Komplek Rasuna Epicentrum Jl. H.R Rasuna Said Jakarta 12940, Indonesia

TO: AMBONO JANURIANTO


TO: AMIT BOSE c/o PT Bakrie Telecom Tbk.


TO: BACHDER BACHTARUDIN c/o PT Bakrie Telecom Tbk.


5

TO: HARYA MITRA HIDAYAT c/o PT Bakrie Telecom Tbk.


TO: IMANUDDIN KENCANA PUTRA c/o PT Bakrie Telecom Tbk.


TO: RINI MARIANI SOEMARNO c/o Ministry of State Owned Enterprise

Jl. Medan Merdeka Selatan No. 13 Jakarta 10110, Indonesia

TO: EKA ANWAR c/o PT Digital Media Asia 9th Floor, Multivision Tower

Jl. Kuningan Mulia Lot 9B Jakarta Selatan 12980, Indonesia

SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF NEW YORK

--------------------------------------------------------------x UNIVERSAL INVESTMENT ADVISORY SA; : UNIVERSAL ABSOLUTE RETURN SP; : VAQUERO MASTER EM CREDIT FUND LTD., : HARSHIL KANTILAL KOTHARI; : FOOTBRIDGE CAPITAL, LLC; : GROWTH CREDIT FUND IC; : : : Index No. 652890/2014 Plaintiffs, : :

: (Hon. Saliann Scarpulla) :

v. : SECOND AMENDED : VERIFIED COMPLAINT

: : : BAKRIE TELECOM PTE, LTD, : PT BAKRIE TELECOM TBK, : PT BAKRIE NETWORK, : PT BAKRIE CONNECTIVITY, : PT BAKRIE & BROTHERS TBK, : ANINDYA NOVYAN BAKRIE, : FREDERIK JOHANES MEIJER, : MUHAMMAD BULDANSYAH, : JULIANDUS A LUMBAN TOBING, : RAKHMAT JUNAIDI, : JASTIRO ABI , : GAFUR SULISTYO UMAR, : AI MULYADI MAMOER, : RAJSEKAR KUPPUSWAMI MITTA, : NALINKANT A RATHOD, : AMBONO JANURIANTO, : AMIT BOSE, : BACHDER BACHTARUDIN, : HARYA MITRA HIDAYAT, : IMANUDDIN KENCANA PUTRA, : RINI MARIANO SOEMARNO, : EKA ANWAR, : : Defendants. : --------------------------------------------------------------x



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Pursuant to Court directive for consolidation of the First Amended Complaint herein with

the Complaint filed under Index No. 653745, the Plaintiffs Universal Investment Advisory SA,

Universal Absolute Return SP, Vaquero Master EM Credit Fund Ltd., Harshil Kantilal Kothari,

Footbridge Capital, LLC, and Growth Credit Fund IC, (collectively “Plaintiffs”), by their

attorneys Greenberg Traurig, LLP, as and for their Second Amended Verified Complaint,

respectfully allege as follows:

NATURE OF THE ACTION

1. This action arises out of a $380 million offering (“Offering”) by Bakrie Telecom

Pte. Ltd. (“Issuer”), on behalf of Pt Bakrie Telecom Tbk (“BTEL”), of 11.5% Guaranteed Senior

Notes due in 2015 (“Notes”) under an Indenture dated as of May 7, 2010, as supplemented by a

Supplemental Indenture dated as of January 27, 2011 (together, “Indenture”). The stated

maturity date on the face of the Notes is May 7, 2015.

2. Together, Plaintiffs are holders of over 25% of the outstanding $380 million in

Notes.

3. The Notes are in payment default, the Issuer having stated in writing that it would

not make interest payments either when due or for the foreseeable future. The maturity date of

the Notes has been accelerated and both principal and interest on the Notes are now past due.

4. BTEL is an Indonesian wireless telecom company controlled by the prominent

and powerful Bakrie family in Indonesia and their conglomerate of companies. As alleged

herein, BTEL’s Offering Memorandum used to solicit Plaintiffs and others to invest in the

Offering, contained material misstatements and omissions that fraudulently portrayed BTEL as a

successful, innovative telecom company, solvent and thriving, when in fact it was insolvent,

continually propped up by stop-gap infusions by the Bakrie family and by long-time Bakrie

3

lenders whose huge loans were repaid when BTEL’s secured debt was offloaded to unsecured

investors through the Offering.

5. Defendants, which include BTEL, along with its Directors and Commissioners

and parent company/controlling shareholder at the time of the Offering, knew, upon information

and belief, by their positions of management control and superior knowledge, that BTEL’s

business was debt ridden, that its capital assets were substantially overstated in the Offering and

that the CDMA technology they touted in the Offering was becoming obsolete and

uncompetitive in the Indonesian market.

6. Upon further information and belief, by their positions of management control

and superior knowledge, Defendants knew when they made the Offering that BTEL’s financial

condition meant that it would likely default on its obligations under the Notes, and that investors

would then be forced to take pennies on the dollar in company restructurings under the threat of

unilateral Indonesian proceedings, even though, to lure investors as to the legitimacy of the

Offering, in the Indenture, BTEL expressly represented and agreed that (i) its obligations were

governed by New York law and were enforceable in New York courts, and (ii) an investor’s

right to receive principal and interest and to sue on the debt could not be compromised or

abrogated without the investor’s consent. These agreements and rights were fundamental to the

attractiveness of the Offering and to protect against the risks undertaken by investors, in

particular Plaintiffs.

7. Defendants have now brought their scheme full circle. After the Notes went into

payment default, all principal and interest was accelerated both by the Plaintiffs as 25% holders

and separately by the Indenture Trustee, Bank of New York Mellon (“BNY Mellon”). After

BTEL rejected Plaintiffs’ attempts to investigate its financial condition and negotiate an

4

equitable resolution for all Note holders, Plaintiffs instituted this suit for payment of all principal

and interest due under the Notes, as authorized by BTEL’s Indenture.

8. In response to this suit, Defendants improperly staged a restructuring proceeding

in Indonesia in an attempt to eviscerate the $380 million in debt due and owing and to effect an

end-around the rights of investors granted by BTEL in the Indenture. BTEL’s restructuring plan

purports to (i) eliminate millions in past-due interest entirely; (ii) reduce Note holder’s interests

to approximately $0.07 on $1.00 for 70% of bond face-value (under a 10-year forced holding

period), and approximately $0.48 on $1.00 for 30% of bond face-value under a best-case

“waterfall” revenue scenario to pay creditors, which in fact is unachievable given BTEL’s

historical performance. Given BTEL’s poor financial condition, this latter provision will likely

convert under the plan to $0.07 shares after 10 years.

9. BTEL’s Indonesian restructuring plan was supposedly approved in Indonesia on

false premises and without creditor authorization through a bogus process which allowed the

wholly controlled Issuer (and not BNY Mellon as Trustee) to vote the $380 million Note debt (i)

notwithstanding that the Issuer assigned all rights under the intercompany loan with BTEL to

BNY Mellon as Trustee, and (ii) contrary to the Trustee’s express written instruction that the

Issuer could not act on behalf of the Trustee or the Note holders in the Indonesian proceeding.

10. Plaintiffs, therefore, also sue for a declaration (i) that the sham Indonesian

proceedings are a nullity, without force and effect, and the creditors’ rights and claims are

preserved for determination in this action, and (ii) for the damages that have been caused to

Plaintiffs by Defendants’ unlawful and unauthorized activity in Indonesia, including significant

counsel and advisor fees in amounts to be proved at trial.

5

PARTIES

11. Plaintiff Universal Investment Advisory SA (“Universal Investment”) is a Swiss

company with a principal place of business in Geneva, Switzerland. Universal Investment is by

written assignment the holder of $86,930,000 in Notes. The assignment held by Universal

Investment transfers to Universal, inter alia, the right, title and interest of the assignor to any and

all of its claims under the Indenture and Notes. The assignor of the Universal Investment

assignment, Tembo Sondirya Padone (“Padone”), is the beneficial owner and record holder of

$86,930,000 in Notes. Padone has received a proxy letter, as provided in the Indenture, from

Cede & Co., (“Cede”), the Global Notes holder, as nominee of Depository Trust Company

(“DTC”), which authorizes Padone or his assigns to, inter alia, prosecute the claims asserted

herein against the Defendants.

12. Plaintiff Universal Absolute Return SP (“Universal Absolute”) is a Cayman

Mutual Fund and is the beneficial owner and record holder of $4,000,000 in Notes. Universal

Absolute is in the process of obtaining a proxy letter, as provided in the Indenture, from Cede,

the Global Notes holder as nominee of DTC, which authorizes Universal Absolute or its assigns

to, inter alia, prosecute the claims asserted herein against the Defendants.

13. Plaintiff Vaquero Master EM Credit Fund Ltd. (“Vaquero”), a Cayman Mutual

Fund with a place of business of its fund manager in San Antonio, Texas, is the beneficial owner

and record holder of $9,253,000 in Notes. Vaquero has received a proxy letter, as provided in

the Indenture, from Cede, the nominee of DTC which authorizes Vaquero or its assigns to, inter

alia, prosecute the claims asserted herein against the Defendants.

14. Vaquero also holds $100,000 in Notes by assignment from James S. Bonfils

(“Bonfils”) who is the beneficial owner and record holder of such Notes. The assignment held

6

by Vaquero transfers, inter alia, the right, title and interest of the assignor (Bonfils) to pursue any

and all claims under the Indenture and Notes. Bonfils has received a proxy letter, as provided in

the Indenture, from the Global Notes holder, Cede, who is the nominee of DTC, which proxy

authorizes Bonfils or his assigns to, inter alia, prosecute the claims asserted herein.

15. Plaintiff Harshil Kantilal Kothari (“Kothari”) is a resident of Hong Kong and is

the beneficial owner and record holder of $250,000 in Notes. Kothari is in the process of

obtaining a proxy letter from Cede, the nominee of DTC, which authorizes Kotari or his assigns

to, inter alia, prosecute the claims asserted herein against the Defendants.

16. Plaintiff Footbridge Capital LLC (“Footbridge”) is a limited liability company

organized under Delaware law with a principal place of business in the state of Connecticut.

Footbridge is the beneficial owner and record holder of $4,300,000 in Notes. Footbridge has

received a proxy letter, as provided in the Indenture, from the Global Notes holder Cede, the

nominee of DTC, which proxy authorizes Footbridge or its assigns to, inter alia, prosecute the

claims herein against the Defendants.

17. Plaintiff Growth Credit Fund IC (“Growth Credit”) is organized under the laws of

Jersey, Channel Islands and is the beneficial owner/record holder of $750,000 in Notes. Growth

Credit has received a proxy letter, as provided in the Indenture, from Global Notes holder Cede,

the nominee of DTC, which authorizes Growth Credit or its assigns to, inter alia, prosecute the

claims herein against the Defendants.

18. Together Plaintiffs are beneficial owners and holders and/or assignees of in

excess of 25% of the $380 million in Notes outstanding. As noted above, all Plaintiffs, except

two (which are in process) have received from Cede, the holder of the two Global Notes, a proxy

letter as provided in the Indenture to pursue rights on behalf of the Global Notes holder,

7

including prosecuting the claims asserted herein. Proxies in place represent in excess of 25% of

the outstanding Notes.

19. Defendant Bakrie Telecom Pte. Ltd., the Issuer of the Notes, is a company

organized under the laws of Singapore. The Issuer is wholly owned by BTEL and is the

borrower pursuant to the Offering.

20. Defendant BTEL is a company organized under the laws of Indonesia. BTEL, the

parent of the Issuer, received the proceeds from the Offering governed by the Indenture. BTEL

issued an unconditional Parent Guarantee with respect to the Issuer’s obligations.

21. Defendants PT Bakrie Network and PT Bakrie Connectivity are Indonesian

subsidiaries of BTEL; executed Subsidiary Guarantees whereby they irrevocably and

unconditionally guaranteed payment of the Issuer’s obligations under the Notes.

22. Defendant Pt Bakrie & Brothers Tbk (“Bakrie & Brothers”) is a company

organized under the laws of Indonesia. Bakrie & Brothers is the parent company of numerous

subsidiaries, including BTEL (collectively, “Bakrie Group”). Bakrie & Brothers is described in

the Offering Memorandum as “one of the largest diversified conglomerates in Indonesia.”

According to the Offering Memorandum, at the time of the Offering, Bakrie & Brothers owned

39.6 % of BTEL. The Offering Memorandum acknowledges that Bakrie & Brothers is BTEL’s

controlling shareholder and has effective control over the management of BTEL.

23. Defendant Anindya Novyan Bakrie is presently the President Commissioner of

BTEL. A.N. Bakrie was President Director of BTEL at the time of the Offering, having served

in that capacity since 2004. Among other positions, A.N. Bakrie served in management

positions in Bakrie & Brothers and other Bakrie Group affiliates. As alleged herein, by exercise

of power and decision-making through his senior management position and, upon information

8

and belief, knowledge of the true financial and operating condition of BTEL, defendant A.N.

Bakrie actively participated in the acts and omissions alleged herein.

24. Defendant Frederik Johannes Meijer was Deputy President Director of BTEL at

the time of the Offering, having served in that capacity since 2007. As alleged herein, by

exercise of power and decision-making through his senior management position and, upon

information and belief, knowledge of the true financial and operating condition of BTEL,

defendant Meijer actively participated in the acts and omissions alleged herein.

25. Defendant Muhammad Buldansyah was Deputy President Director of BTEL at

the time of the Offering, having served in that capacity since 2007. As alleged herein, by



defendant Buldansyah actively participated in the acts and omissions alleged herein.

26. Defendant Juliandus Asi Lumban Tobing was Director of BTEL at the time of the

Offering, having served in that capacity since 2005. As alleged herein, by exercise of power and

decision-making through his senior management position and, upon information and belief,

knowledge of the true financial and operating condition of BTEL, defendant Tobing actively

participated in the acts and omissions alleged herein.

27. Defendant Rakhmat Junaidi (“Junaidi”) was Director of BTEL at the time of the

Offering, having served in that capacity since 2003. Junaidi was also a Director of the Issuer a

the time of the Offering. As alleged herein, by exercise of power and decision-making through

his senior management position and, upon information and belief, knowledge of the true

financial and operating condition of BTEL, Defendant Junaidi actively participated in the acts

and omissions alleged herein.

9

28. Defendant Jastiro Abi (“Abi”) is presently the President Director of BTEL. Abi

was Finance Director at the time of the Offering, having served in that capacity since 2007. Abi

had served as BTEL’s Chief Financial Officer and was a Director of other Bakrie Global

affiliates. Abi was also a Director of the Issuer at the time of the Offering. As alleged herein, by



defendant Abi actively participated in the acts and omissions alleged herein.

29. Defendant Gafur Sulistyo Umar (“Umar”) was the President Commissioner of

BTEL at the time of the Offering, having served in that capacity since 2003. Umar was also at

the time of the Offering the Managing Director and CEO of Bakrie & Brothers, and held or had

held numerous other management positions with Bakrie Group affiliates. As alleged herein, by



defendant Umar actively participated in the acts and omissions alleged herein.

30. Defendant Ai Mulyadi Mamoer was an Independent Commissioner at the time of

the Offering and was Chairman of BTEL’s Audit Committee. As alleged herein, by exercise of

power and decision-making through his senior management position and, upon information and

belief, knowledge of the true financial and operating condition of BTEL, defendant Mamoer

actively participated in the acts and omissions alleged herein.

31. Defendant Rajsekar Kuppuswami Mitta was an Independent Commissioner at the

time of the Offering. As alleged herein, by exercise of power and decision-making through his

senior management position and, upon information and belief, knowledge of the true financial

10

and operating condition of BTEL, defendant Mitta actively participated in the acts and omissions

alleged herein.

32. Defendant Ambono Janurianto was a Commissioner of BTEL at the time of the

Offering, having served in that position since 2003. He also was a Director of Bakrie & Brothers

and held or had held numerous other management positions with Bakrie Group affiliates. As

alleged herein, by exercise of power and decision-making through his senior management

position and, upon information and belief, knowledge of the true financial and operating

condition of BTEL, defendant Janurianto actively participated in the acts and omissions alleged

herein.

33. Defendant Nalinkant Amratlal Rathod was a Commissioner of BTEL as the time

of the Offering, having served in at capacity since 2005. As alleged herein, by exercise of power

and decision-making through his senior management position and, upon information and belief,

knowledge of the true financial and operating condition of BTEL, defendant Rathod actively


34. Defendant Bachder Bachtarudin is a Director of BTEL and has served in that

position since 2013. As alleged herein, by exercise of power and decision-making through his

senior management position and, upon information and belief, knowledge of the true financial

and operating condition of BTEL, defendant Bachtarudin actively participated in the acts and

omissions alleged herein.

35. Defendant Harya Mitra Hidayat is Director of Compliance and Risk Management

for BTEL and has served in that capacity since 2012. As alleged herein, by exercise of power

and decision-making through his senior management position and, upon information and belief,

11

knowledge of the true financial and operating condition of BTEL, defendant Hidayat actively


36. Defendant Imanuddin Kencana Putra is the Director of Human Resources and has

served in that capacity since 2012. As alleged herein, by exercise of power and decision-making

through his senior management position and, upon information and belief, knowledge of the true

financial and operating condition of BTEL, defendant Putra actively participated in the acts and


37. Defendant Amit Bose was the Deputy President Director of BTEL in 2012. As

alleged herein, by exercise of power and decision-making through his senior management

position and, upon information and belief, knowledge of the true financial and operating

condition of BTEL, defendant Bose actively participated in the acts and omissions alleged

herein.

38. Defendant Rini Mariano Soemarno was an independent Commissioner of BTEL

in 2012-2013. As alleged herein, by exercise of power and decision-making through her senior

management position and, upon information and belief, knowledge of the true financial and

operating condition of BTEL, defendant Soemarno actively participated in the acts and


39. Defendant Eka Anwar was the Director of Marketing but, on information and

belief, left BTEL in 2014. As alleged herein, by exercise of power and decision-making through

his senior management position and, upon information and belief, knowledge of the true

financial and operating condition of BTEL, defendant Anwar actively participated in the acts and


12

40. BTEL’s Directors and Commissioners at the time of the Offering are referred to

hereafter as the “Offering Defendants.” BTEL’s Directors and Commissioners subsequent to the

Offering are referred to as the “Interim Defendants.” BTEL’s present Directors and

Commissioners are referred to as the “Present Defendants.” “Individual Defendants” means the

Offering Defendants, the Interim Defendants and/or the Present Defendants, as the context

requires.

41. Each of the Individual Defendants acted both individually and collectively in

furtherance of the acts and omissions alleged herein. Upon information and belief, in exercising

their respective positions of power and using the knowledge obtained by such positions,

Defendants intended to cause the violations of Plaintiffs’ rights as alleged herein and/or

recklessly disregarded such rights when engaging in such conduct.

42. As set forth in the Offering Memoranda, the Board of Directors is ultimately

responsible for BTEL’s day-to-day business, under the supervision of the Board of

Commissioners. Under BTEL’s articles of association, for the Board of Directors to engage in

certain transactions, such as the lending or borrowing of money on BTEL’s behalf, prior written

approval of the Board of Commissioners is required. As such, the Offering required the approval

of both the Board of Directors and Board of Commissioners.

JURISDICTION AND VENUE

43. The Court has personal jurisdiction over BTEL pursuant the Indenture and Notes,

which are governed under New York law. In the Indenture, the Issuer, Company and Guarantors

agreed to the jurisdiction of any New York State or United States federal court sitting in the

Borough of Manhattan, the City of New York, and waived any objection to venue and any claim

that the action has been brought in an inconvenient forum.

13

44. The Court has personal jurisdiction over Bakrie & Brothers, the Offering

Defendants, Interim Defendants, and Present Defendants, who are or were in control of and are

or were responsible for the business affairs of BTEL at the time of the events alleged herein, and

thus are closely related to BTEL, Issuer and Guarantors sufficient under the law to be bound by

the forum selection and consent to jurisdiction clauses in the Indenture.

45. By the Indenture, the Issuer, BTEL and Guarantors designated Law Debenture

Corporate Services, 400 Madison Ave, New York, New York 10017, as their agent for service of

process.

46. Venue is proper in this Court under, inter alia, CPLR §§ 501 and/or 509.

FACTUAL BACKGROUND

I. The Offering

47. BTEL is a telecommunications company, servicing a significant portion of the

Indonesian market. It is the fifth largest telecommunications company in Indonesia.

48. In early 2010, BTEL determined to raise funds in the capital markets by issuing

the Notes in the Offering.

49. In connection with the Offering, the Offering Defendants caused to be distributed

into the marketplace an Offering Memorandum dated April 30, 2010 (the “Offering

Memorandum”), which included BTEL’s audited financial statements for the year ended

December 31, 2009. The Offering Defendants also caused to be distributed into the marketplace

an Offering Memorandum dated January 24, 2011 (“Supplemental Offering Memorandum”) in

connection with the Supplemental Offering and Supplemental Indenture. Unless the context

otherwise requires, the Offering Memorandum and Supplemental Offering Memorandum are

referred to collectively herein as “OM.”

14

50. BTEL, parent of the Issuer, issued a Parent Guarantee irrevocably and

unconditionally guaranteeing payment all of the Issuer’s obligations under the Notes. BTEL’s

guarantee was as a “principal obligor” and pursuant to the terms of the Notes and Indenture.

51. BTEL subsidiaries PT Bakrie Network and PT Bakrie Connectivity (“BTEL

Subsidiaries”) issued Subsidiary Guarantees pursuant to the terms of the Notes and Indenture.

On information and belief, the BTEL Subsidiaries had limited assets. Collectively, the Parent

Guarantee and the Subsidiary Guarantees are referred to herein as the “Guarantees” and as the

context requires, BTEL and the BTEL Subsidiaries as the “Guarantors.”

52. By way of an intercompany loan from the Issuer, BTEL received the

approximately $380 million in proceeds raised from the Offering.

53. The Issuer’s assets include the receivable from BTEL in repayment of the

intercompany loan of the Offering Proceeds.

54. On information and belief, based on writings from BNY Mellon, in connection

with the intercompany loan to BTEL, the Issuer assigned to BNY Mellon, the Indenture Trustee,

all of its rights under the intercompany loan agreements with BTEL, including the right to

receive payment of the intercompany loan upon default.

55. Under the terms of the Notes and Indenture, the Issuer is obligated to make semi-

annual payments of interest in an amount of approximately $21.8 million by funding an Interest

Reserve Account controlled by the Indenture Trustee BNY Mellon in New York.

56. The Indenture obligates the Issuer to designate a transfer and payment agent

located in New York. The Indenture names BNY Mellon in New York as Issuer’s transfer and

payment agent.

57. At all relevant times, the Issuer acted as the agent of BTEL.

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II. BTEL’s Insolvency at or Before the Offering and Continuing Insolvency

58. Upon information and belief, BTEL was insolvent at or before the Offering and

thereafter has remained insolvent, unable to generate sufficient revenues from operations to pay

its debts as they became due. As alleged herein, the statements made by BTEL in the Offering

Memorandum portrayed a very different picture of the prospects for BTEL as a going concern.

A. Insufficient Cash Flow to Pay for Capital Expenditures

59. Upon information and belief, BTEL’s cash flows from operations were

continually and substantially insufficient on a yearly basis to pay for its investment in network

infrastructure assets. From 2004 through 2011, BTEL’s capital expenditures were well over

100% of its operating cash flow. From 2006 to 2008, BTEL’s capital expenditures exceeded

250% of its operating cash flow. In 2010, the year of the initial Offering, capital expenditures

were approximately 231% of operating cash flow. By comparison, the median ratio of its

competitors’ capital expenditures to cash flow for 2009 to 2011 ranged from 65% to 70%.

60. As its capital expenses serially exceeded its operating cash flow, BTEL was

continually required to access high interest loans to pay for the infrastructure equipment

necessary to build, maintain and expand the CDMA telephone network that is the core of its

business. As a result, BTEL’s debts continued to mount.

B. BTEL’s Poor Return on Assets

61. Notwithstanding its large capital expenditures, BTEL’s return on assets ranged

from poor to abysmal. Its return on assets declined from 3.5% in 2006 to 1.0% in 2009, and was

negative thereafter, from -1.6%, -6.4% and -13.1% in 2010 to 2012, respectively, and -24.8% in

2013.

62. BTEL’s return on assets was substantially below its competitors. In contrast, the

median return on assets of competitors from 2009 to 2012 ranged from 4.5% to 9.8%.

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63. BTEL’s return on assets was also below the interest rates on the borrowings

through which the assets were financed.

C. BTEL’s Competitive Decline and Outdated Technology

64. BTEL’s substantially lower return on its assets in comparison to its competitors’

returns caused BTEL to lose its competitive position relative to its peers. This loss in

competitive position also resulted, in part, from the fact that the consumer marketplace was

shifting away from the CDMA technology on which BTEL’s business was based.

D. BTEL’s Overstated Value of Assets

65. Notwithstanding its dismal return on assets and sliding competitive position,

during the years before and after the Offering, BTEL improperly depreciated its CDMA assets

on a straight line basis, claiming a useful life of those assets of ten to fifteen years. In fact, the

useful life was materially less.

66. In 2012 and 2013, BTEL was forced to write-off a portion of its fixed assets by

over US $209 million, establishing that the value of its fixed assets in prior years, including 2010

and 2011, was materially overstated.

67. BTEL continued to earn negative returns even after it took impairment charges,

indicating that such charges were insufficient to reflect the real value of the assets on BTEL’s

books.

E. BTEL’s Insufficient Cash Flow to Pay Debts

68. Upon information and belief, BTEL’s cash flow was always insufficient to meet

its debt requirements. The ratio of BTEL’s operating profits to interest expense fell from 3.01 in

2007 to 1.71 in 2008, to 0.90 in 2009, 0.63 in 2010. A ratio below one indicates that BTEL’s

operating profits were not sufficient to pay its annual interest expenses.

17

69. Upon further information and belief, as BTEL’s use of equipment was not

producing income that would allow BTEL to repay the loans used to purchase the equipment,

BTEL was required to use additional borrowings, re-financings and offerings to stay afloat.

F. BTEL’s High-Interest Loans and Offerings to Keep BTEL Afloat

70. BTEL continually refinanced its existing debt with ever-increasing high-interest

loans, such refinancings including:

(a) In 2007 BTEL obtained a $145 million, 5-year loan to pay off outstanding balances on a prior loan with Bank Mandiri and for capital expenditures. The new loan required no payments of principal for the first two years.

(b) On September 4, 2007, BTEL issued $71.2 million in 5-year bonds on the Indonesian Stock Market that bore 11.9% interest, payable quarterly.

(c) On December 16, 2009 (after payments were due on the $145 million loan), BTEL borrowed $25 million in a bridge loan and drew an additional $20 million on March 27, 2010. The interest rate on these loans was 9% plus LIBOR for the first six months following utilization and 11% plus LIBOR up to December 2010.

(d) On May 7, 2010, BTEL made the initial Offering of $250 million of 11.5% 5-year notes. The proceeds were to pay off the $145 million loan, the bridge loans and be used for capital expenditures.

(e) On July 16, 2010, BTEL received a 3-year, LIBOR +9% loan for $30 million to pay off debts, funding of loan service accounts and to purchase infrastructure equipment.

(f) On January 27, 2011, BTEL made the supplemental Offering of $130 million, and again used the proceeds to pay off outstanding loans to BTEL’s lender.

(g) On August 30, 2012, BTEL borrowed $50 million for an 18-month term bearing interest at 11.5%.

G. BTEL’s Working Capital Decline

71. BTEL’s working capital has substantially declined since 2008. This decline

demonstrates that BTEL’s current payments due were increasing at a rate greater than BTEL’s

ability to generate and retain cash from its operations and financings.

72. From 2005 through 2013 BTEL’s current ratio of assets to liabilities declined

from 1.99 to 0.09. In 2009, immediately prior to the Offering, BTEL’s current ratio was 0.86

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indicating that BTEL’s current assets were not then sufficient to repay its current liabilities.

Given that BTEL was not earning sufficient cash flows from its operations to currently pay its

bills, upon information and belief, BTEL had to borrow on a short-term basis to make current

payments.

III. The Offering Was Fraudulent

73. The OM (which as defined above is collectively the Offering and Supplemental

Offering Memoranda) portrayed BTEL as a highly successful company. The OM represented

the following: (a) BTEL was the fifth largest wireless provider in Indonesia and had experienced

significant growth in its subscriber base in the immediate preceding years; (b) BTEL’s large

subscriber base provided it with scale sufficient to increase profitability; that is, the larger base

provided more revenue without proportionally increasing its costs; (c) BTEL had won numerous

awards for its services and achievements, and the OM listed among BTEL’s competitive

strengths its “strong brand recognition” and “leading marketing position” in greater Jakarta.

74. The OM stressed that BTEL’s capital assets were critical to its business

operations and ability to compete. The OM touted BTEL’s “high quality network” and lower

capital requirements for expansion and upgrades. The OM represented that BTEL’s network

base infrastructure included 3,677 base transceivers stations as of the Offering Memorandum and

3,900 by the time of the Supplemental Offering Memorandum.

75. The OM assured investors that BTEL’s “utilization of CDMA technology

facilitates a faster network speed” that consequently did not require BTEL “to obtain additional

spectrum to upgrade to 3G equivalent network speeds.”

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76. In the OM, BTEL stated in the OM that BTEL was undertaking a program to

optimize the capability of its existing network through investment in advanced technology which

would increase network capacity by upgrading transmission infrastructure.

77. The OM further represented that BTEL would expand its business by launching

wireless broadband services nationwide in the second quarter of 2010 using its existing CDMA

network and spectrum.

78. By each of these statements alleged above in paragraph 74 through 77, BTEL

represented to prospective investors that its existing CDMA technology and network was more

than sufficient to meet its present and near future business needs.

A. The OM Failed To Disclose That BTEL Was Insolvent

79. The financial and business picture of BTEL presented in the OM was false and

misleading. The OM failed to disclose that before and at the time of the Offering, BTEL was

insolvent, as demonstrated by its inability to pay its debts as they became due through its cash

flow from operations and by its continual need for cash infusions in efforts to pay down some of

its debt obligations.

80. Prior to and at the time of the Offering and Supplemental Offering, BTEL’s cash

flows from operations, as shown above, were always insufficient to pay for its huge capital

expenditures, and its obligations to pay interest and principal on its debt obligations.

81. The OM did not disclose that BTEL’s insolvency was masked by its refinancing

of its debt and operations, and that its ability to obtain loans was based solely on the Bakrie name

and long-standing relationship between the Bakrie conglomerate and its long-time lenders and

investment bankers. None of this was disclosed in the OM.

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82. The continual borrowing gave an undeserved and misleading credibility to

BTEL’s creditworthiness, operations and finances and provided BTEL with a false veneer of

solvency at the time of, and as BTEL presented to the marketplace in connection with, the

Offering.

B. The OM Materially Inflated the Value of BTEL’s Assets

83. BTEL disguised its insolvency in the OM by substantially inflating the value of

its fixed infrastructure assets essential to its wireless telecom business. The OM misled investors

by misrepresenting that its fixed assets, for which BTEL was spending on average over $150

million each year from 2007 through 2011, had a useful and depreciable life of ten to fifteen

years.

84. At the time of the Offering, BTEL’s assets were upon information and belief

substantially impaired. BTEL’s abysmal return on assets, its declining competitive position and

a $209 million impairment charge taken after the Offering show that the OM’s financials, which

disclosed none of this information, were materially misleading.

85. BTEL and the Offering Defendants, upon information and belief, knew and

understood, based on market conditions, its competitors, the rapidly changing telecom

technology and BTEL’s financial performance, that the representation of a fixed asset useful life

of 10-15 years in the OM was grossly overstated.

C. The OM Misrepresented BTEL’s CDMA Technology and Capabilities

86. The OM’s representations and assurances concerning BTEL’s CDMA technology

were false and misleading. The OM representation of a “high quality network” and lower capital

requirements for expansion and upgrades were misleading and were, upon information and

belief, a smokescreen to obscure the truth that BTEL’s CDMA technology and infrastructure was

21

quickly becoming obsolete and that its huge infrastructure expenditures were made to prop up

this obsolete technology.

87. BTEL further misled investors in the OM by representing that it was undertaking

a program to optimize the capability of its network through investment in advanced technology

which would increase network capacity through upgrading transmission infrastructure, and that

its existing CDMA technology and network was more than sufficient to meet its present and near

future business needs and would be sufficient for BTEL to expand its business by launching

wireless broadband services nationwide in the second quarter of 2010.

88. In fact, the technology was neither advanced, nor could the CDMA technology

support business needs for BTEL to remain competitive in the marketplace.

89. Upon information and belief, the Offering Defendants knew, based on their

superior positions of senior management that these material representations in the OM were false

and misleading and were made to obscure BTEL’s true financial and business positions, in

particular that it had to continually borrow to sustain its operations and that its infrastructure was

becoming obsolete as alleged above.

90. Upon further information and belief, the Offering Defendants knew that BTEL

had made massive capital expenditures and debt obligations, and other contractual commitments

all based on a rapidly declining wireless technology that was losing its competitive position in

the marketplace.

D. The Offering Defendants Knew BTEL Would Default On The Notes

91. Upon information and belief, the Offering Defendants knew at the time of the

Offering that BTEL (and therefore the Issuer) would be incapable of meeting its obligations

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when the $380 million in Notes matured, and that holders of the Notes would be forced to accept

whatever restructuring of their Note obligations that the Defendants proposed.


Offering that BTEL would not be able to refinance $380 million when the Notes matured.


Offering that no Bakrie affiliated person or entity would provide $380 million in fresh capital to

satisfy the Notes when mature.


Offering that BTEL would be unable to raise $380 million in the public or private markets to

satisfy the Notes when schedule to mature.

IV. After The Offering Defendants Continue To Mislead Investors And Conceal Their Fraudulent Activities

95. BTEL defaulted on the November 2012 interest payment when it failed to make

that payment altogether.

96. In February 2013, BTEL assured holders that what it described as the November

2012 “technical” default would be fully cured by April 2013, and further that the May 2013

interest payment would be timely made.

97. On April 10, 2013, BTEL reassured holders that the May 2013 interest payment

would be made, and that BTEL would hold a telephone call with investors on May 2, 2013 to

explain BTEL’s financial situation.

98. On May 3, 2013, BTEL issued a notice that summarized information provided by

BTEL on its May 2 telephone call, including:

(a) That BTEL intended to make a timely payment of the interest on the Notes

due on 7 May 2013 that would be funded by cash from its operations;

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(b) That BTEL had various initiatives to improve cash flow from operations and

intended to do everything it could to continue to meet it payment obligations

under the Notes and its other financial obligations, while prioritizing working

capital and required capital expenditures;

(c) That BTEL appreciated the support of Note holders in not taking action with

respect to the “technical” defaults relating to the maintenance of the Interest

Reserve Account – and requested that Note holders continue to support BTEL in

its efforts to maintain payments through cash flow from operations; and

(d) That BTEL was committed to keeping the Note holders informed about the

results from operations on a quarterly basis and any other information deemed

necessary for the Note holders.

99. BTEL’s public statements assuring Note holders that measures had been taken to

improve its cash flow and that the delinquent and due bond interest payments would be paid

from operations were false and misleading in that, as upon information and belief the Defendants

knew, BTEL did not have the wherewithal to pay its creditors in the ordinary course, including

the Note holders as alleged above, and such statements were intended to, and did result in,

causing Note holders to rely on such false statements and not take action or investigate the

veracity of BTEL’s prior representations.

100. On information and belief, the capital for the November 2012 and May 2013

interest payments was provided by the Bakrie family to give the appearance that BTEL had

stabilized its operations. As Defendants intended, this short term cash infusion gave Plaintiffs

and other Note holders a false picture of BTEL’s financial condition so that they would not act or

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investigate BTEL or its operations, and gave BTEL time to secretly formulate a plan to deal with

its dire financial situation and its obligations under the Notes through a forced restructuring.

V. BTEL’s Retaliation Against Plaintiffs And The Fabricated “Restructure” Of The Notes

101. In May 2014, on the eve of the scheduled interest payment, BTEL issued a notice

to bondholders that BTEL was engaged in negotiations with a “Steering Committee” of “key

holders” concerning BTEL’s operations and potential restructuring of the Notes.

102. These “key holders” did not include any of the Plaintiffs who represent over 25%

of the Notes. Nor, upon information and belief, did the interests of the “key holders” constitute a

majority of the interests of the Note holders. Nor did the “key holders” include the Global Note

Holder, Cede or negotiations include consultation with the Indenture Trustee.

103. The May 2014 notice further stated that pending resolution of BTEL’s

negotiations, it would not be making any interest payments on the Notes. A true and correct

copy of BTEL’s May 2014 notice is attached hereto as Exhibit A.

104. In response, Plaintiffs and others formed an Ad Hoc Committee of bond holders

(“Ad Hoc Committee”), representing holdings exceeding $106 million, which is greater than

25% of the Notes outstanding under the Indenture and Supplemental Indenture.

105. The Ad Hoc Committee, through counsel, approached BTEL to engage in

meaningful dialogue concerning its financial and operational plans and its plan for restructuring

the Notes.

106. Effective July 17, 2014, the Ad Hoc Committee and BTEL entered into a

Memorandum of Understanding “to enter in to a process to reach a resolution to the default”

(“MOU”). BTEL acknowledged in the MOU that Plaintiffs as a “Committee are holders of in

excess of twenty five (25%) of the Notes pursuant to the Indenture.”

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107. The MOU was valid for “2 calendar weeks.” Further, pursuant to the MOU, the

Ad Hoc Committee agreed that during the two-week period, it “shall not, take any acceleration

or enforcement action against Bakrie, directly or indirectly, whether in connection with the Notes

or otherwise.”

108. During this period, the Ad Hoc Committee was permitted to view certain

Company documents in a virtual diligence room. Notwithstanding their legal obligations to

provide such data to Plaintiffs, the Present Defendants rejected the Ad Hoc Committee’s requests

for underlying supporting technical, financial and economic data that an investor would need to

fully analyze and understand the basis for BTEL’s restructuring plan and term sheet (“Term

Sheet”), which, for unstated reasons, proposed to operate out of industry norm by impairing the

interests of Note holders but not that of the equity holders.

109. The MOU terminated two calendar weeks after July 17, 2014, as it was not

“expressly extended and continued by the parties hereto in writing.”

110. Thereafter, by Notice to Note holders dated September 3, 2014, BTEL announced

a meeting of the Note holders on September 24, 2014 at the offices of FTI Consulting, its

restructuring advisor, in Singapore (“September Meeting”), for BTEL and its advisors to present,

among other things, BTEL’s restructuring plan and term sheet that had been reached solely with

the Steering Committee, as set forth in the Notice. A copy of the Notice is attached hereto as

Exhibit B.

111. Attendance at the September Meeting was restricted to Note holders who were

required to register and confirm their holdings by September 18, 2014. Any advisors to Note

holders required special invitation of BTEL.

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112. Notwithstanding that the Ad Hoc Committee and its advisors represent Note

holdings exceeding 25% of the aggregate $380 million offering, and BTEL’s written

acknowledgement of those holdings, BTEL through its counsel informed the Ad Hoc Committee

that it and/or its advisors would be barred from attending and participating in the September

Meeting.

VI. Plaintiffs Sue to Enforce the Notes

113. Under the Indenture and Notes, Plaintiffs’ claims for payment of past due

principal and interest and their right to pursue such claims in a suit in New York cannot be

compromised or abrogated without their consent.

114. Section 6.07 of the Indenture provides: “Notwithstanding anything to the

contrary, the right of any holder of a Note to receive payment of the principal of, premium, if

any, or interest on, such Note, or to bring suit for the enforcement of any such payment, on or

after the due date expressed in the Notes of such series, which right shall not be impaired or

affected without the consent of the holder.” (Emphasis added.) Section 6.07 is modeled after

Section 316(b) of the Trust Indenture Act, 15 U.S.C. § 77ppp(b).

115. The Issuer and Guarantors failed to make interest payments due November 2013,

May 2014 and November 2014.

116. Pursuant to the Indenture, based on the continuing defaults referenced above,

Plaintiffs, as holders of at least 25% in the aggregate of the outstanding Notes, issued to the

Issuer, Company and Subsidiary Guarantors, a notice of acceleration dated September 29, 2014

(“Notice of Acceleration”), declaring all principal and interest immediately due and owing. On

that same day, a copy of the Notice was served upon the Issuer, Company and Guarantors, with a

27

copy to BNY Mellon as Trustee under the Indenture. A true and correct copy of the Notice of

Acceleration is attached hereto as Exhibit C.

117. Separately, on November 9, 2014, BNY Mellon as Indenture Trustee issued a

Notice of Acceleration (“BNY Mellon Acceleration”), a true and correct copy of which is

attached hereto as Exhibit D.

118. In the Indenture (incorporated into the Notes), BTEL (and the other Defendants as

having a close relationship with BTEL) agreed to submit to the jurisdiction of the state courts in

New York sitting in Manhattan (New York County) and waived any right to challenge venue or

argue that New York was an inconvenient forum.

119. BTEL further agreed in the Indenture that the Notes, the Indenture and

Guarantees were governed by and in accordance with the laws of the State of New York.

120. As material terms of the US $380 million Offering, BTEL agreed in Section 12.07

of the Indenture that New York law would govern the parties’ rights, that any disputes

concerning the Offering would be resolved in a New York forum and pursuant to Section 6.07 of

the Indenture that the right of bond holders to payment of principal and interest was absolute and

could not be compromised without their express consent.

121. Given the Issuer’s payment defaults on the Notes, on September 22, 2014, certain

of the Plaintiffs commenced this action against the Issuer and Guarantors to enforce the Notes.

VII. Defendants Attempt to Undermine This Action Through the Bogus PKPU Proceeding

122. In breach of the express provisions of the Indenture cited above and in

contravention of Plaintiffs’ rights, BTEL and the Present Defendants upon information and belief

artificially staged a restructuring proceeding in Indonesia, which compelled restructuring of

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BTEL’s debts, including BTEL’s obligations under the Notes, contrary to Section 6.07 of the

Indenture and New York law.

123. Upon information and belief, BTEL staged a cooperating creditor to initiate a

court-supervised debt restructuring proceeding in Indonesia (the “PKPU”) with, upon further

information and belief, the intent and design to interfere with and undermine the Indenture, this

action and the Plaintiffs’ rights to full payment of principal and interest in an estimated amount

of approximately US $120 million.

124. The PKPU is a contested proceeding filed by one of BTEL’s small value

creditors, upon information and belief, in concert with BTEL, against BTEL. Notwithstanding

the PKPU supposedly being a contested proceeding, BTEL refused to oppose the relief and

consented to the proceeding.

125. On November 10, 2014 the Commercial Court of Central Jakarta declared the

conditions for PKPU relief to have been satisfied and appointed a supervisory judge and

administrators.

126. Immediately thereafter the administrators announced a process of less than 30

days for the filing and validation of claims and voting on a composition restructuring plan

(“Plan”) to be submitted by BTEL. On information and belief, the process and timing was under

the control of BTEL and no extension of the process was permitted without a vote of 50% of

creditors holding 2/3 of the debt.

127. On November 24, 2014, BTEL presented the Plan to the creditors. The Plan is

virtually identical to the Term Sheet BTEL had presented to the Ad Hoc Committee in

September 2014, which provided that the equity holders’ rights would not be impaired while the

debt holders’ rights, including the Note holders’ rights, would be impaired.

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128. Under the Plan, Note holders would lose all past due interest, would have 70% of

principal converted to Company stock with a holding period of 10 years after BTEL’s plan is

approved and would receive no interest. The proposed forced composition is based on a value of

250 Rupiah per share, five times the recent trading price of shares, resulting in a 5 to 1 reduction

in the value of the Notes on day 1 to $52.7 million from $266 million (the 70% Note

component). BTEL refused to provide a copy of the valuation reports purportedly utilized by

BTEL in determining the conversion rate for Notes to stock under the Plan. Moreover, given the

further dilution on Company shares proposed by the Plan, it is likely that the Note holder’s

interests would be reduced to $0.07 on $1.00 for 70% of bond face-value, and overall would be

reduced to between $0.07 to $0.19 per dollar of face value.

129. Under the Plan, there are only two classes of creditors: secured and unsecured.

Note holders under the Indenture are treated as part of the unsecured class. No alteration or

counter-Plan was permitted under the Plan.

130. Thus, the Plan as designed is a transparent effort to retain the business and

interests of the Bakrie Group in BTEL unimpaired and in preference to the claims of debt

holders, including Plaintiffs.

131. Under the Plan, creditors were provided only 10 days, until November 24, 2014,

to marshal proofs and file claims with the administrators by hand in Jakarta.

132. On December 3, 2014, BTEL advised creditors that it had a new plan, but failed

and refused, despite demand, to provide creditors with a copy of the purported new plan. On

December 5, 2014, the administrators issued a verification of claims, indicating which claims

would be disallowed and which were accepted and, therefore entitled to vote on the Plan. The

identities of the other creditors recognized by the administrators were not disclosed. By its

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terms, the Plan could be approved by a simple majority of recognized creditors holding 2/3 of

BTEL debt on each of the secured and unsecured debt. The Plan did not permit negotiations

with the creditors prior to the date of the vote.

133. On December 8, 2014, the recognized creditors, who did not include Plaintiffs as

they were barred from voting, voted on the Plan.

134. BTEL, the Present Defendants and Bakrie & Brothers added to their bad faith by

causing the asset-less Issuer to submit a creditor’s claim in the PKPU proceedings, purporting to

be a creditor of BTEL. As part of the Offering, however, the Issuer had assigned of all of its

rights under the Intercompany Loan Agreement with BTEL to BNY. Thus, the Issuer was

purporting to vote creditor rights it did not have.

135. In fact, the Issuer’s participation in the PKPU as a purported “creditor” was

contrary to the express written instructions of BNY Mellon, the Indenture Trustee. Likewise, the

Issuer voted on the Plan despite explicit instructions from BNY that it had no authority to do so.

In particular, over BNY’s written objections, according to BNY the Issuer “attended the

Creditors’ Meeting and represented [itself] as the holder of a US $380m claim against BTEL

without informing the court that [it] had assigned [its] rights in relation to such claims to

[BNY].”

136. BNY, therefore, notified the Issuer and BTEL “[n]otwithstanding that [it] has

purported to compromise the terms of the Intercompany Loan Agreements with BTEL (and

despite not having [BNY’s] authority to do so), the Issuer, BTEL and the Subsidiary Guarantors

remain fully liable for the payment of the principal of premium and interest on, and all other

amounts payable under, the Notes and the Indenture.” A true and correct copy of BNY Mellon’s

letter to the Issuer dated December 10, 2014, is attached hereto as Exhibit E.

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137. On December 9, 2014, a panel of judges appointed as part of the PKPU approved

the December 8 rump vote on the Plan.

138. The Indonesia judicial system is notorious for being corrupt as has been

recognized in periodic United States State Department human rights reports, reports of the

United Nations and judicial opinions including Gryphon Domestic VI, LLC v. APP Int'l Fin. Co.,

B.V., 41 A.D.3d 25, 37, 836 N.Y.S.2d 4, 13 (1st Dep’t 2007).

FIRST CAUSE OF ACTION (Breach of Contract: Issuer, BTEL & Guarantors)

139. Plaintiffs repeat and incorporate by reference paragraphs 1 through 138, as though

fully set forth herein.

140. The Issuer, BTEL and the Subsidiary Guarantors are in default of their respective

obligations under the Notes, Indenture and Guarantees.

141. The maturity date of the Notes has been duly accelerated by Plaintiffs and the

Indenture Trustee, such that both principal and interest is past due.

142. Plaintiffs are entitled to judgment jointly and severally against each of the Issuer,

BTEL and the Subsidiary Guarantors in an amount not less than the interest and principal due

pursuant to the Notes and as to be determined at trial.

SECOND CAUSE OF ACTION (Fraud Against BTEL and Issuer: The Offering)



144. At all times, BTEL and the Issuer acted in concert to effect the Offering and were

the alter egos of each other.

145. The Offering by the Issuer and BTEL was fraudulent in that, inter alia, it (a) failed

to disclose that BTEL was insolvent; (b) failed to disclose that BTEL was repeatedly forced to

32

borrow funds, including from affiliates, to sustain its operations; (c) materially inflated the true

value of BTEL’s assets; and (d) materially misrepresented BTEL’s CDMA technology and

capabilities.

146. None of these material misrepresentations and omissions was disclosed in or

discoverable from the OM or from reasonably available public information at the time of the

Offering.

147. BTEL, based on, among other facts as alleged herein, its inability to pay its

current obligations as they became due and need to continually borrow to sustain its operations,

knew at the time of the Offering that it was insolvent, would continue to be insolvent and would

default on the Notes.

148. BTEL and the Issuer knew at the time of the Offering that BTEL would not be

able to refinance $380 million when the Notes matured.

149. BTEL and the Issuer knew at the time of the Offering that no Bakrie affiliated

person or entity would provide $380 million in fresh capital to satisfy the Notes when due.

150. BTEL and the Issuer knew at the time of the Offering that BTEL would be unable

to raise $380 million in the public or private markets to satisfy the Notes.

151. Based on BTEL’s hidden financial condition and business prospects as alleged

herein, BTEL and the issuer knew at the time of the Offering that a Company restructuring

would render the Notes valueless.

152. Upon information and belief, BTEL and the Issuer knowingly conspired with

others including Defendants to create a market for the Notes by direct and general solicitation,

dissemination of the Offering prospectus and other means, knowing that the Issuer, BTEL and

Guarantors would default on the Notes.

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153. The Notes were traded on the Singapore Stock Exchange and were otherwise sold

to investors, including Plaintiffs or their assignors.

154. Upon information and belief, as alleged herein, BTEL and the Issuer knowingly

made and caused to be made false and misleading material representations and omissions in the

OM as set forth above including without limitation paragraphs 73-94.

155. Plaintiffs (or their assignors) reasonably relied on the OM by obtaining it in the

marketplace following BTEL’s dissemination of that document and reviewing the OM prior to

making their investments in the Notes.

156. Plaintiffs (or their assignors) reasonably relied on the availability of the Notes in

the marketplace as described in the OM as an indication of the genuineness of the Offering and

Notes issued thereunder.

157. Plaintiffs (or their assignors) reasonably relied on the appearance of regularity of

the Offering through the creation of a market for the Notes and the dissemination of the OM.

158. Plaintiffs (or their assignors) had no basis to know of or discover the material

misrepresentations and omissions in the OM or to investigate further BTEL’s finances and

discover BTEL’s insolvency until after it had defaulted on interest payments 2014, and notified

Note holders it would not be making further payments and would seek to restructure its

obligations.

159. Moreover, Plaintiffs (or their assignors) could not have discovered the false and

inflated asset values stated in the OM until, at the earliest, BTEL wrote down the assets in years

subsequent to the OM.

160. As a direct and proximate result of BTEL’s and the Issuer’s fraud, Plaintiffs have

been harmed in an amount to be determined at trial.

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THIRD CAUSE OF ACTION (Aiding and Abetting Fraud Against

Offering Defendants and Bakrie & Brothers: The Offering)



162. The Offering Defendants by their positions of and exercise of power through their

senior management positions had, upon information and belief, actual knowledge at the time of

the Offering that BTEL was insolvent, would remain insolvent and would default on the Notes.

163. Bakrie & Brothers, by its role in effectuating and participating in the Offering as

alleged herein, upon information and belief, had actual knowledge at the time of the Offering

that BTEL was insolvent, would remain insolvent and would default on the Notes.

164. Upon information and belief, as alleged herein, the Offering Defendants and

Bakrie & Brothers had actual knowledge at the time of the Offering that the OM contained

material misstatements and omissions, as set forth above including without limitation paragraphs

75-90.

165. Upon further information and belief, as alleged herein, Bakrie & Brothers had

actual knowledge at the time of the Offering that the OM contained material misstatements and

omissions, as set forth above including without limitation paragraphs 73-94.

166. By their positions of senior management in BTEL, the Offering Defendants

controlled BTEL at the time of the Offering, and authorized and participated in the Offering.

167. By its position as principal shareholder holding 39.6% of BTEL’s shares, Bakrie

& Brothers controlled BTEL at the time of the Offering.

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168. Upon information and belief, by their positions of management control and role in

the Offering, the Offering Defendants knew subsequent to the Offering that BTEL remained

insolvent and would default on the Notes.

169. Upon information and belief, by their positions of management control and role in

the Offering, Bakrie & Brothers knew subsequent to the Offering that BTEL remained insolvent

and would default on the Notes.

170. By their respective positions of control, including authorizing the Offering, the

Offering Defendants and Bakrie & Brothers caused BTEL to issue the OM and caused the

Offering to occur.

171. By such conduct including, among other things, promoting and authorizing the

fraudulent Offering the Offering Defendants and Bakrie & Brothers gave substantial assistance

to BTEL in furtherance of the fraud alleged herein.

172. Because of the nature and circumstances of the Offering and related transactions

and BTEL, further details and circumstances of the fraud are particularly within the knowledge

of BTEL and the Defendants.

173. As a direct and proximate result of the above-alleged fraudulent scheme aided and

abetted by Offering Defendants and Bakrie & Brothers, Plaintiffs have been harmed in an

amount to be determined at trial.

FOURTH CAUSE OF ACTION (Fraud By BTEL: Post-Offering Conduct)



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175. After the Offering, BTEL made material misstatements and false assurances to

Plaintiffs, including regarding BTEL’s cash flow and its intention to make interest payments and

as to its general financial condition, including, inter alia, those described in paragraphs 95-100.

176. BTEL’s public statements assuring Plaintiffs and other Note holders that

measures had been taken to improve its cash flow and that the past due interest payments would

be paid from operations were false and misleading in that no such measures had been taken,

BTEL’s cash position was spiraling downward and revenue generated from operations was

insufficient to satisfy current obligations.

177. Upon information and belief, BTEL made the false statements and assurances to

induce Plaintiffs and other Note holders to cause them to forebear and thereby delay in taking

any action or investigate or otherwise protect their rights or seek their remedies under the Notes

or Indenture.

178. Plaintiffs’ reliance on these false statements and assurances enabled BTEL further

to transfer and otherwise dissipate its assets, incur additional debt and obligations, and generally

deepen its insolvency.

179. Plaintiffs reasonably relied on the false statements and assurances made by BTEL

to their detriment. Absent the false statements and assurances, Plaintiffs would have exercised

earlier their rights and remedies under the Notes and Indenture.

180. As a direct and proximate result of the false assurances of BTEL to its creditors

following its defaults in payment of the Notes, Plaintiffs have been harmed in an amount to be

determined at trial.

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FIFTH CAUSE OF ACTION (Aiding and Abetting Fraud Against Interim Defendants

and Bakrie & Brothers: Post-Offering Conduct)



182. By their positions of superior knowledge and control of BTEL through

management and voting control, upon information and belief the Interim Defendants and Bakrie

& Brothers caused BTEL to make misrepresentations as set forth above including, without

limitation, paragraphs 95-100 to mislead Plaintiffs and other Note holders and induce them not to

protect their rights and seek their remedies.

183. Upon information and belief, at all relevant times that the Interim Defendants and

Bakrie & Brothers controlled BTEL, BTEL was insolvent.

184. As alleged herein, the Interim Defendants and Bakrie & Brothers caused BTEL to

dissipate its assets, incur additional debt and obligations without any viable source from which to

service the debt, and generally deepen its insolvency.

185. By their knowledge of the true state of BTEL’s financial condition and its dated

technology and infrastructure, and their causing BTEL to make the false statements to the

contrary alleged herein, the Interim Defendants and Bakrie & Brothers gave substantial

assistance to BTEL in its continuing fraud.

186. As a direct and proximate result of Defendants’ scheme, Plaintiffs have been

harmed in an amount to be determined at trial.

SIXTH CAUSE OF ACTION (Breach of Fiduciary Duty Against All Defendants)



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188. At or about the time Plaintiffs (or their assignors) purchased their Notes, BTEL

was upon information and belief insolvent and could not pay its debts as they became due.

189. Because of BTEL’s insolvency, and their superior knowledge about BTEL’s true

financial condition and dated hardware and infrastructure, Defendants stood in a fiduciary

relation with the Plaintiffs and other Note holders and creditors and were required to hold

BTEL’s assets in trust for them and act in the best interests of all creditors.

190. Given their knowledge of BTEL’s true financial condition, Defendants had no

reasonable expectation that BTEL’s future business and finances would enable BTEL to pay the

Notes when they became due.

191. Defendants breached their fiduciary duties to Plaintiffs by, among other things,

dissipating BTEL’s assets, by causing BTEL to take on additional obligations and debt knowing

it did not have adequate operations to sustain debt service, and by knowingly allowing BTEL to

sink further into insolvency.

192. Defendants knew and planned, upon information and belief and as alleged herein,

that a BTEL restructuring would effectively render the Notes valueless.

193. Plaintiffs have suffered injury directly and proximately caused by the breaches of

fiduciary duty of the Defendants in that such “restructuring” assured that BTEL would not only

default in its obligations to Plaintiffs, but also further dilute any possible recovery they could

obtain from BTEL.

194. Plaintiffs have incurred damages as a result in an amount to be determined at trial.

SEVENTH CAUSE OF ACTION (Aiding and Abetting Breach of Fiduciary Duty Against

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Bakrie & Brothers and Individual Defendants)



196. Upon information and belief as alleged herein, Bakrie & Brothers had actual

knowledge at all relevant times that BTEL was insolvent.

197. Upon further information and belief as alleged herein, BTEL’s Commissioners

and Directors owed Plaintiffs, as creditors, fiduciary obligations to preserve Company assets.

198. Bakrie & Brothers knowledge is demonstrated by its status as controlling

shareholder, allowing it to exercise of complete domination and control over BTEL.

199. Upon further information and belief, Bakrie & Brothers knew at all relevant times

that BTEL and Plaintiffs, as bond holders, and creditors would suffer injuries as a direct result of

the violation of Defendants’ fiduciary duties as alleged herein.

200. Bakrie & Brothers knew, upon information and belief, that BTEL was dissipating

its assets, taking on additional obligations and debt, and sinking further into insolvency in

violation of the Defendants’ fiduciary obligations.

201. Bakrie & Brothers, through its superior knowledge of the true state of BTEL’s

affairs and control of BTEL and by the affirmative conduct alleged herein, provided substantial

assistance to the Defendants in bringing about the harm to the Plaintiffs.

202. Each of the Individual Defendants knowingly provided substantial assistance in

further of the Individual Defendants’ breach of fiduciary duties.

203. Plaintiffs suffered damages as a direct and proximate cause of the conduct of

Bakrie & Brothers and the Individual Defendants, in an amount to be determined at trial.

EIGHTH CAUSE OF ACTION

(Breach of Contract Against BTEL: Indenture and Notes)

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205. The Indenture is a valid and binding contract between Plaintiffs and BTEL.

206. The Notes are valid and binding contracts between Plaintiffs and BTEL.

207. Pursuant to the Indenture, BTEL irrevocably and unconditionally guaranteed the

Issuer’s obligations under the Notes. BTEL’s guarantee was as a “principal obligor” and was

made “according to the terms of the Notes and Indenture.”

208. BTEL agreed under Section 12.07 of the Indenture (incorporated in the Notes)

that New York law would govern and under Section 6.07 that the right of bond holders to

payment of principal and interest was absolute and could not be compromised without their

consent. These Indenture provisions were a material condition and inducement for Plaintiffs (or

their assignees as the case may be) to participate in the US $380 million Offering.

209. Upon information and belief, BTEL artificially staged the PKPU, which had as its

sole purpose a compelled restructuring of BTEL’s creditors to dilute their positions to nominal

value, including BTEL’s obligations under the Notes, which is contrary to and in violation of

Section 6.07 of the Indenture and New York law.

210. Upon information and belief, BTEL’s intent and design was to interfere with and

undermine the Indenture, the New York Action and the Plaintiffs’ rights to full payment of

principal and interest in an estimated amount of approximately US $120 million.

211. BTEL’s conduct is in breach of Indenture and Notes.

212. Plaintiffs have fully performed their obligations under the Indenture and Notes.

213. Plaintiffs have suffered damages as a natural and foreseeable consequence of

BTEL’s breach of the Indenture and Notes, in an amount to be determined at trial.

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NINTH CAUSE OF ACTION (Declaratory Judgment)



215. By its voluntary participation in the PKPU, BTEL claims that the result of that

process, including the unauthorized vote of the Issuer as a purported creditor under the Indenture

is valid and effective.

216. Plaintiffs reject BTEL’s position concerning the validity and effectiveness of the

PKPU process and results, contending that the PKPU was a sham, in violation of the Indenture

and unauthorized by the Note holders and other creditors of BTEL.

217. By BTEL’s disregard and disavowal of its obligations under the Indenture

concerning the agreed venue to resolve disputes concerning the Indenture and the Offering, and

disregard of the rights and obligations of the creditors under that agreement, a justiciable

controversy has arisen and exists between the parties.

218. The controversy is of sufficient immediacy and reality to warrant declaratory

relief under CPLR § 3001.

219. Plaintiffs have no adequate remedy at law.

220. Plaintiffs are entitled to a declaration that the PKPU proceedings and Company

restructuring have no effect on the rights of Plaintiffs and obligations of the Issuer, Company and

Guarantors under the Notes and Indenture, and that BTEL and other Defendants are liable for the

damages incurred by the Plaintiffs with respect to the PKPU proceedings.

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PRAYER FOR RELIEF

WHEREFORE, Plaintiffs demand judgment against Defendants as follows:

1) On the First Cause of Action, an award of money damages in favor of Plaintiffs

and against BTEL, the Issuer and Subsidiary Guarantors, jointly and severally, in an amount of

all principal and interest due Plaintiffs under the Notes, to be proved at trial, but no less than

$120 million, plus pre- and post- judgment interest;

2) On the Second Cause of Action, an award of money damages in favor of

Plaintiffs and against BTEL in an amount to be proved at trial, but no less than $100 million,

plus pre- and post- judgment interest;

3) On the Third Cause of Action, an award of money damages in favor of Plaintiffs

and against the Offering Defendants and Bakrie & Brothers in an amount to be proved at trial,

but no less than $100 million, plus pre- and post- judgment interest;

4) On the Fourth Cause of Action, an award of money damages in favor of Plaintiffs

and against BTEL in an amount to be proved at trial, but no less than $100 million, plus pre- and

post- judgment interest;

5) On the Fifth Cause of Action, an award of money damages in favor of Plaintiffs

and against the Interim Defendants and Bakrie & Brothers in an amount to be proved at trial, but

no less than $100 million, plus pre- and post- judgment interest;

6) On the Sixth Cause of Action, an award of money damages in favor of Plaintiffs

and against all Defendants in an amount to be proved at trial, but no less than $100 million, plus

pre- and post- judgment interest;

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7) On the Seventh Cause of Action, an award of money damages in favor of

Plaintiffs and against Bakrie & Brothers in an amount to be proved at trial, but no less than $100

million, plus pre- and post- judgment interest;

8) On the Eighth Cause of Action, an award of money damages in favor of Plaintiffs

and against BTEL in an amount to be proved at trial, but no less than $100 million, plus pre- and

post- judgment interest;

9) On the Nineth Cause of action, declaring that the PKPU proceedings and

Company restructuring have no effect on the rights of Plaintiffs and obligations of the Issuer,

Company and Guarantors under the Notes and Indenture, and declaring the liability of BTEL and

other Defendants for the damages incurred by the Plaintiffs with respect to the PKPU

proceedings;

10) On all Causes of Action, an award of attorneys fees and costs Plaintiffs have been

forced to incur to enforce their rights under the Notes; and

11) On all Causes of Action, granting Plaintiffs such other and further relief as this

Court may deem just and proper.

Dated: New York, New York February 18, 2015

GREENBERG TRAURIG, LLP By: /s/ Gary Greenberg Gary Greenberg

GREENBERG TRAURIG, LLP One International Place Boston, MA 02110 Tel: (617) 310-6000 Email: [email protected]

44

James W. Perkins, Esq. John J. Elliott, Esq. GREENBERG TRAURIG, LLP 200 Park Avenue New York, NY 10166 Tel: (212) 801-9200 Email: [email protected] [email protected]

-and- Hal Hirsch, Esq. 600 Madison Avenue New York, New York 10022 Tel: (212) 763-9790

Attorneys for Plaintiffs Universal Investment Advisory SA, Universal Absolute Return SP, Vaquero Master EM Credit Fund, Ltd., Harshil Kantilal Kothari, Footbridge Capital, LLC, and Growth Credit Fund IC

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ATTORNEY VERIFICATION

Gary Greenberg, an attorney admitted to practice in the Courts of the State of New York,

affirms that the following statements are true under penalties of perjury:

1. I am an attorney for plaintiffs Universal Investment Advisory SA, Universal

Absolute Return SP, Vaquero Master EM Credit Fund Ltd., Harshil Kantilal Kothari, Footbridge

Capital, LLC, and Growth Credit Fund IC.

1. I have read the foregoing Second Amended Verified Complaint and it is true to

my knowledge, except as to those matters stated to be alleged on information and belief. As to

those matters, I believe the Second Amended Verified Complaint to be true. The grounds of my

belief as to all matters in the Second Amended Verified Complaint not stated upon my

knowledge are based upon correspondence and other documents furnished to me by Plaintiffs.

__/s/ Gary Greenberg ____________________ Gary Greenberg

EXHIBIT A



EXHIBIT B



EXHIBIT C



EXHIBIT D



EXHIBIT E



Documents

2015 11:27 PM