EXHIBIT 10.2e
EXECUTION COPY
SILVER LAKE PARTNERS, L.P.
000 XXXX XXXXXX
XXX XXXX, XX 00000
September 6, 2001
Gartner, Inc.
00 Xxx Xxxxxxx Xxxx
Xxxxxxxx, XX 00000
Attention: Xxxxxxx Xxxxxxxx
Re: 6.0% Convertible Junior Subordinated Promissory Notes dated April 2000
Dear Xxxxxxx:
This letter agreement, upon your execution and return, will be binding
upon Silver Lake Partners, L.P. and its affiliated entities Silver Lake
Investors L.P. and Silver Lake Technology Investors, L.L.C. (Silver Lake
Partners, L.P. and its affiliates being collectively referred to as "SLP") and
Gartner, Inc. ("Gartner") in respect of revisions (the "Note Revisions") to
SLP's investment in the outstanding 6.0% convertible subordinated notes due 2005
(the "Notes") of Gartner purchased by SLP on April 17, 2000. The Note Revisions
will include the amendment of (i) the definitive Notes issued by Gartner to SLP,
and the other applicable definitive agreements between the parties relating to
the issuance of the Notes and (ii) the Securityholders Agreement, dated as of
April 17,2000 (the "Securityholders Agreement"), among Gartner and the SLP
affiliated entities that are parties thereto. The terms and conditions of the
Note Revisions are set forth below (and capitalized terms that are defined in
the Notes and Securityholders Agreement are used herein with their defined
meanings).
1. Binding Agreement. This letter agreement constitutes a binding
agreement between the parties, to the extent expressly set forth herein, with
the amendments and other modifications provided for hereunder by the Note
Revisions taking effect, without any further action required, immediately upon
the execution and delivery of this letter agreement by the parties hereto.
Promptly following the execution and delivery of this letter agreement, the
parties agree to prepare in good faith restatements of the applicable original
Notes documentation reflecting the terms and conditions contained in this letter
agreement, provided that the parties agree to be bound by the terms and
conditions contained herein until such time (if any) as such restatements of the
Notes documentation have been entered into for the Note Revisions. With the
exception of the terms and conditions contained in this letter agreement, all
other terms, conditions, representations, warranties, covenants and other
provisions contained in the Notes documentation executed in connection with the
purchase of the Notes by SLP shall remain in full force and effect and shall not
be otherwise affected hereby.
2 . Note Revisions Terms.
(a) Refinancing Right. The parties agree that Gartner's Refinancing Right
under the Notes has terminated.
(b) SLP Claimed Causes of Action. SLP will, and hereby does, waive and
release Gartner from all potential claims alleged by SLP or which may be alleged
by SLP against Gartner, including (without limitation) 10b-5, 10b-6, fraud,
misrepresentation, breach of covenant, breach of fiduciary duty and similar
claims relating to the acquisition of the Notes, the conduct by Gartner of the
relationship with SLP to date and the pricing of the First Anniversary Reset.
SLP expressly waives its rights under any statutory provision stating that a
general release of claims is not binding as to any claims of which the releasor
is not aware.
(c) Conversion upon Change in Control. (i) The parties agree that (A)
subject to Section 2(c)(iii) below, in the event of a change in control of
Gartner in which its public stockholders receive cash or other consideration
from a third party (a "Change in Control") at a price per share greater than or
equal to $15.00 (subject to appropriate adjustment for stock splits and the
like), the Notes will automatically convert into Gartner Common Stock (and will
be entitled to receive the same consideration per share paid to holders of
Gartner Common Stock in the Change in Control), and (B) in the event of a Change
in Control at a lower price per share (or in the circumstances set forth in
Section 2(c)(iii) below), SLP will have the right but not the obligation, at its
election, to convert the Notes into Gartner Common Stock (and will be entitled
to receive the same consideration per share paid to holders of Gartner Common
Stock in the Change in Control).
(ii) The parties also agree and acknowledge that upon a Change in Control
in which the Notes convert, (A) the rights and obligations of the parties under
Articles 2, 3 and 5 of the Securityholders Agreement will terminate upon the
consummation of such Change in Control, and (B) SLP will be entitled (upon its
request therefor) to be designated as a "selling stockholder" in any
registration statement filed by or on behalf of the acquiring entity for the
registration of the securities being issued to Gartner's stockholders in such
Change in Control, with SLP being entitled to immediately sell all such
securities that it receives in such transaction (SLP's "Resale Registration
Rights"), provided that SLP shall not be permitted to exercise its Resale
Registration Rights if the proposed Change of Control is a tax-free exchange for
Gartner shareholders and such exercise would be the sole cause of that tax-free
Change in Control transaction becoming a taxable transaction (such transaction,
an "Impaired Tax-Free Change in Control Transaction"); and provided further
that, for the avoidance of doubt, following an Impaired Tax-Free Change in
Control Transaction, nothing contained herein will in any way otherwise limit
SLP's right to transfer the securities SLP receives in such transaction pursuant
to non-registered sales (including Rule 144 sales) or pursuant to SLP's existing
registration rights under Article 4 of the Securityholders Agreement. In
connection with any registration pursuant to the Resale Registration Rights,
Gartner and any acquiring entity will (x) keep the registration statement
effective for a period of at least 180 days (or such longer period as SLP may
reasonably request), subject to the ability of the issuer to toll the ability of
SLP to sell the securities that it receives in such transaction for up to two
periods of up to 45 days each (with at least 45 days transpiring between the
issuer's two tolling periods and which periods may not in any event be exercised
for a 45-day period following the closing of the Change in Control transaction)
upon notice to SLP, in the event that the Board of Directors of the issuer
determines that it would be materially detrimental to the issuer for SLP to
effect sales during such period, in which case the effectiveness of the
registration statement will be extended to the extent of the tolled period, (y)
take all actions that are customarily required to be taken by registrants in
such registered offerings and (z) pay all expenses related to such registration
(other than commissions to be paid by SLP as selling stockholders in respect of
their securities).
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(iii) The parties further agree that if, in connection with an Impaired
Tax-Free Change in Control Transaction in which Gartner's public stockholders
receive cash or other consideration at a price per share greater than or equal
to $15.00 (subject to appropriate adjustment for stock splits and the like),
then following the parties' good faith efforts to implement reasonable changes
to the proposed transaction structure to achieve a tax-free exchange, the Notes
will not automatically convert and the transaction will be treated for all
purposes hereunder as a Change in Control at a price below $15.00 per share. SLP
agrees that in the event of an Impaired Tax-Free Change in Control Transaction
at a price per share greater than or equal to $15.00 (subject to appropriate
adjustment for stock splits and the like), in connection with which SLP elects
to convert the Notes into Gartner Common Stock (or otherwise enters into an
arrangement to receive consideration from such Impaired Tax-Free Change in
Control Transaction), SLP will not be entitled, without the consent of Gartner,
to receive consideration directly or indirectly from the acquiring entity that
is greater in value (per share of Gartner Common Stock underlying the Notes) or
different in form than the per share consideration offered in such transaction
to the public stockholders of Gartner.
(d) Continuing Rights Following a Change in Control. The parties agree
and acknowledge that, upon any Change in Control, SLP will retain its right to
redemption under Section 5 of the Notes and its registration rights under
Article IV of the Securityholders Agreement, and (if applicable) any acquiring
entity will assume and honor SLP's existing registration rights, which rights
will thereafter be exercisable by SLP in respect of the securities received by
SLP from the acquiring entity in such Change in Control.
(e) TechRepublic. SLP hereby waives any right to acquire an equity
interest in TechRepublic, and agrees that CNET, Inc. may rely upon such waiver
in connection with its recent acquisition of TechRepublic.
(f) Capital Changes. Gartner contemplates a capital change involving the
combination of the currently outstanding Class A and Class B Common Stock into
one class. The parties will work together to determine any appropriate revisions
to existing SLP equity ownership thresholds that, following any such
recapitalization, will continue to trigger SLP's various rights under the
Purchase Agreement, the Notes and the Securityholders Agreement, in light of the
recapitalization and SLP's current higher ownership interest in Gartner.
3 . Share Repurchases. Pursuant to Section 2.3(ix)(B) of the
Securityholders Agreement, SLP hereby consents to (a) the share repurchase
program authorized by the Board of Directors of Gartner at a meeting held on
July 17, 2001, provided, however, that such repurchase (i) is limited to the
repurchase by Gartner of shares of its outstanding Class A Common Stock and
Class B Common Stock, (ii) is in an aggregate amount not to exceed $75.0
million, subject to any reduction as a result of the IMS Repurchase required
pursuant to clause (b) below, (iii) occurs prior to July 17, 2003, (iv) is
consummated in open market transactions (and not pursuant to an issuer tender
offer) and (v) is at prevailing market prices (the "July 17 Repurchase
Program"), and (b) the share repurchase authorized by the Board of Directors at
a meeting held on August 7, 2001, provided, however, that such repurchase (i) is
limited to the repurchase by Gartner of up to 2.0 million shares of its
outstanding Class A Common Stock from IMS Health, (ii) is in a transaction that
is conditioned upon, and subject to, the consummation of the sale by IMS Health
of its approximately 5.0 million additional shares of Class A Common Stock
(excluding shares to be repurchased by Gartner) to certain buyers (other than
Gartner) and (iii) reduces the maximum $75.0 million amount of the July 17
Repurchase Program concomitant with the dollar amount equal to aggregate amount
to be paid by Gartner in its purchase of such
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shares from IMS Health (such repurchase, the "IMS Repurchase"). The foregoing
consent of SLP shall not apply to any share repurchase program or share
repurchases (or modification of the July 17 Program or the IMS Repurchase) of or
by Gartner that are not effected as part of the July 17 Program or the IMS
Repurchase and in accordance with the foregoing terms (or, in the case of
clauses (a)(iii) and (a)(iv) above, substantially consistent with the terms
thereof).
4. Miscellaneous Provisions.
(a) Confidentiality. Except as may be required by law or applicable
exchange regulations, each of the parties agrees (i) to keep confidential and
not disclose any information with respect to the Note Revisions to any other
person, other than such party's advisers and representatives who need to receive
such information for purposes of actively participating in the Note Revisions
and who have been informed of the confidentiality provisions herein, and (ii) to
consult with each other prior to issuing any press or news release relating to
the Note Revisions or otherwise making any public statements with respect
thereto.
(b) Governing Law. This letter agreement shall be governed by, and
construed in accordance with, the laws of the State of New York.
(c) Expenses. Upon request by SLP, Gartner will reimburse all of SLP's
reasonable out-of-pocket expenses related to the Note Revisions, including the
reasonable fees and expenses of attorneys employed by them in connection with
the Note Revisions, subject to a cap of $150,000.
(d) Successors and Assigns. This letter agreement shall be binding upon
and shall inure to the benefit of the parties hereto, their affiliates and their
respective predecessors, successors, heirs, administrators and assigns, and each
of them. In connection with any Gartner Change in Control transaction, Gartner
hereby agrees that it shall undertake to cause the applicable acquiring entity
to comply with the terms and conditions set forth herein, subject to any
exceptions expressly contained herein.
(e) Counterparts. This letter agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
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Please indicate your binding agreement to the terms and conditions of this
letter agreement by executing this letter agreement in the space provided below.
Very truly yours,
SILVER LAKE PARTNERS, L.P.
By: Silver Lake Technology Associates, L.L.C.,
its general partner
By: /s/ Xxxxx X. Xxxxxxxx
---------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Managing Member
Accepted and agreed to
as of the date first written above:
GARTNER, INC.
By:__________________________
Name:
Title
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