Exhibit 2.15
RECAPITALIZATION AND EXCHANGE AGREEMENT
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This RECAPITALIZATION AND EXCHANGE AGREEMENT (this "Agreement"), is
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made as of October 19, 2001 by and among Interliant, Inc. (the "Company") and
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each of the holders named in Schedule I hereto (each a "Holder" and
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collectively, the "Holders").
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RECITALS
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WHEREAS, pursuant to that certain Purchase Agreement, dated February
10, 2000, between the Company and the Initial Purchasers (as defined therein)
(the "Purchase Agreement") and the Indenture (the "Indenture"), dated February
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16, 2000, between the Company and The Chase Manhattan Bank, as trustee, the
Company issued its 7% Convertible Subordinated Notes due 2005 (the "Subordinated
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Notes"), and the Holders purchased from the Initial Purchasers Subordinated
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Notes in the aggregate principal amount of $126,753,000, allocated among the
Holders as set forth in Schedule I hereto opposite the name of such Holder;
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WHEREAS, the Company is in default as of the date hereof of certain of
its obligations under the Subordinated Notes;
WHEREAS, the Company and the Holders desire to effect a
recapitalization of the Company by exchanging the Subordinated Notes held by
them for cash and new securities as set forth in this Agreement;
NOW THEREFORE, in consideration of the mutual representations,
warranties, covenants and agreements set forth herein, the parties hereto agree
as follows:
ARTICLE I - THE EXCHANGE
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1.1 Exchange. Subject to and in accordance with the terms of this
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Agreement, at the Closing (as defined below), each Holder shall deliver and
surrender to the Company Subordinated Notes in the principal amount set forth
opposite such Holder's name on Schedule I hereto and, in exchange, the Company
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shall pay, issue and deliver to each such Holder (i) cash in an amount set forth
opposite such Holder's name on Schedule II hereto, (ii) 10% Senior Convertible
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Notes of the Company, due 2006 to be issued pursuant to the Indenture (the
"Senior Notes Indenture"), dated as of the Closing Date (as defined below),
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between the Company and The Chase Manhattan Bank, as trustee, in the form
attached hereto as Exhibit A (the "Senior Notes"), in the principal amount set
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forth opposite such Holder's name in Schedule II, and (iii) warrants, to be
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issued pursuant to the Warrant Agreement, dated as of the Closing Date, between
the Company and The Chase Manhattan Bank, as warrant agent, in the form attached
hereto as Exhibit B (the "Warrants"), to purchase up to that number of shares of
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common stock of the Company, par value $.01 per share (the "Common Stock"), set
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forth opposite such Holder's name on Schedule II hereto at a price of $0.60 per
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share, or such greater consideration as may be paid to the remaining holders of
the Subordinated Notes under the exchange offer
contemplated by the Company (the "Exchange Offer") pursuant to Rule 13e-4
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promulgated under the Securities Exchange Act of 1934, as amended (the "Exchange
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Act").
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1.2 Closing. The closing of the exchange described in Section 1.1 above
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(the "Closing") shall occur at the offices of Proskauer Rose LLP, 1585 Broadway,
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Xxx Xxxx, Xxx Xxxx 00000 at a date and time to be agreed upon by the parties,
but in no event later than December 31, 2001 (the "Closing Date"). At the
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Closing, each Holder (i) shall deliver and surrender to the Company for
cancellation certificates representing the Subordinated Notes to be delivered
and surrendered by such Holder endorsed in blank, and otherwise in form and
substance reasonably satisfactory to counsel to the Company, and (ii) shall
deliver a properly executed Registration Rights Agreement, dated as of the
Closing Date, in the form attached herein as Exhibit C (the "Rights Agreement").
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At the Closing, the Company shall deliver to each Holder (i) a check payable to
such Holder in an amount equal to the cash payment, (ii) a certificate
registered in the name of such Holder representing Senior Notes in the principal
amount to be received by such Holder, (iii) a certificate registered in the name
of such Holder representing that number of Warrants to be received by such
Holder and (iv) a properly executed Rights Agreement.
1.3 Waiver. Subject to the consummation of the exchange contemplated by this
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Agreement, each Holder hereby waives any and all rights to receive any payments,
including, without limitation, interest payments with respect to the
Subordinated Notes, and agrees that the Company's obligations to the Holders
under this Agreement, the Senior Note Indenture, the Senior Notes, the Rights
Agreement and the Warrant Agreement supercede and replace in their entirety the
Company's obligations to the Holders under the Subordinated Notes, the Purchase
Agreement, the Offering Memorandum of the Company relating to the Subordinated
Notes, dated February 10, 2000, the Indenture and any other documents executed
in connection therewith.
ARTICLE II - REPRESENTATION AND WARRANTIES OF THE COMPANY
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The Company represents and warrants to each Holder, that:
2.1 Organization, Qualifications and Corporate Power. The Company is a
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corporation duly incorporated, validly existing and in good standing under the
laws of the State of Delaware and is duly licensed or qualified to transact
business as a foreign corporation and is in good standing in each jurisdiction
in which the nature of the business transacted by it or the character of the
properties owned or leased by it requires such licensing or qualification,
except where such failure to qualify or be in good standing would not have a
material adverse effect on the Company. The Company has the corporate power and
authority (i) to own and hold its properties and to carry on its business as now
conducted and as proposed to be conducted, (ii) to execute, deliver and perform
this Agreement, the Senior Notes Indenture, the Warrant Agreement and the Rights
Agreement (collectively, the "Transaction Documents"), and (iii) to issue, sell
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and deliver the Senior Notes, the Warrants, the additional Senior Notes in lieu
of cash interest
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payments on the Senior Notes (the "PIK Notes"), and the shares of Common Stock
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issuable upon exercise of the Warrants (the "Warrant Shares") and upon
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conversion of the Senior Notes and the PIK Notes (the "Conversion Shares") (the
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Senior Notes, the PIK Notes, the Warrants, the Warrants Shares and the
Conversion Shares, each, a "Security" and collectively, the "Securities").
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2.2 Corporate Authorization; Non-Violation. The execution and delivery by the
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Company of the Transaction Documents, the performance by the Company of its
obligations thereunder, the issuance, sale and delivery of the Senior Notes, the
Warrants, the PIK Notes, and the reservation, issuance and delivery of the
Warrant Shares and the Conversion Shares, (i) have been duly authorized by all
requisite corporate action, (ii) other than as set forth on Schedule 2.2 hereto,
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will not violate any provision of law, any order of any court or other agency of
government, the Certificate of Incorporation of the Company, as amended (the
"Charter"), or the By-laws of the Company, as amended, or any provision of any
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indenture, agreement or other instrument to which the Company or any of its
properties or assets is bound, or conflict with, result in a breach of,
constitute (with due notice or lapse of time or both) a default under,
accelerate or terminate any such indenture, agreement or other instrument, or
result in the creation or imposition of any lien, charge, restriction, claim or
encumbrance of any nature whatsoever upon any of the properties or assets of the
Company and (iii) will not require any notice, consent or waiver under any
material indenture, agreement or other instrument to which the Company is a
party or by which any of its properties or assets are bound, other than such
notice, consent or waiver as shall have previously been obtained.
2.3 Issuance of Securities. When issued in accordance with this Agreement and
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the Senior Notes Indenture, the Senior Notes and the PIK Notes will be duly
authorized and validly issued, and will be free and clear of all liens, charges,
restrictions, preemptive or similar rights, claims and encumbrances imposed by
or through the Company except as set forth in this Agreement, the Senior Notes
Indenture, the Rights Agreement and the Charter. When issued in accordance with
this Agreement and the Warrant Agreement, the Warrants will be duly authorized
and validly issued and will be free and clear of all liens, charges,
restrictions, claims and encumbrances imposed by or through the Company except
as set forth in this Agreement, the Warrant Agreement, the Rights Agreement, the
Warrants and the Charter. The Warrant Shares and the Conversion Shares have been
duly reserved, and shall remain reserved out of the authorized but unissued
shares of Common Stock, for issuance upon exercise of the Warrants and upon
conversion of the Senior Notes and the PIK Notes and, when so issued, will be
duly authorized, validly issued, fully paid and nonassessable shares of Common
Stock and will be free and clear of all liens, charges, restrictions, preemptive
or similar rights, claims and encumbrances imposed by or through the Company
except as set forth in this Agreement. The issuance, sale or delivery of the
Securities is not subject to any preemptive right of stockholders of the
Company, or to any right of first refusal or other right in favor of any person,
which have not been duly and validly waived.
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2.4 Validity. This Agreement constitutes, and when executed, delivered, and/or
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issued, the other Transaction Documents, the Senior Notes, the PIK Notes and the
Warrants will constitute, the legal, valid and binding obligations of the
Company, enforceable in accordance with their respective terms.
2.5 Full Disclosure. All documents filed by the Company pursuant to the
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Exchange Act since December 31, 1999: (i) were prepared in accordance with the
requirements of the Exchange Act and the rules and regulations thereunder, (ii)
did not at the time they were filed contain any untrue statement of a material
fact, and (iii) did not at the time they were filed omit to state a material
fact necessary to make the statements therein, in light of the circumstances
under which they were made, not misleading. The representations and warranties
of the Company contained in this Agreement, any schedule, annex, or exhibit
hereto and any agreement, instrument, certificate or information furnished by
the Company to the Holders pursuant to this Agreement, including the information
referred to in Section 3.7 hereof, taken as a whole, do not contain as of the
date hereof any untrue statement of material fact or omit to state a material
fact required to be stated herein or therein or necessary to make the statements
herein or therein, in light of the circumstances under which they were made, not
misleading.
2.6 Capitalization. The authorized, issued and outstanding share capital of the
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Company as of September 30, 2001, is as set forth in Schedule 2.6A. All of the
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outstanding shares of capital stock of the Company have been duly authorized,
validly issued and are fully paid and non-assessable. Except as set forth on
Schedule 2.6A and Schedule 2.6B, there are no existing option, warrant, call,
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commitment or other agreements to which the Company is a party or bound
requiring, and there are no convertible securities of the Company outstanding
which upon conversion would require, the issuance of any additional shares of
Common Stock or other securities convertible into Common Stock or redemption of
any shares of Common Stock. Except as contemplated by the Rights Agreement or
the other agreements set forth on Schedule 2.6B, the Company is not a party to
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any agreement granting registration or anti-dilution rights to any person with
respect to its debt or equity securities.
2.7 No Material Adverse Change. The financial statements of the Company
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included in its most recent quarterly report on Form 10-Q (the "Form 10-Q") have
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been prepared in accordance with GAAP applied on a consistent basis and, as of
their respective dates and for the periods then ended, fairly present the
consolidated financial position and results of operation of the Company and its
consolidated subsidiaries. Except as set forth in Schedule 2.7, since the date
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of the financial statements included in the Form 10-Q, there has been no
Material Adverse Change in the Company and its consolidated subsidiaries.
"Material Adverse Change" shall mean any change in the business, operations,
properties, prospects or financial condition of any person that is, or is
reasonably likely to be, material and adverse to such person and its
subsidiaries and affiliates, taken as a whole, and/or any condition,
circumstances, or situation that would
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prohibit or otherwise interfere with the ability of such person to enter into
and perform any of its obligations under the Transaction Documents.
Notwithstanding the preceding sentence, Material Adverse Change shall not
include any adverse change caused by a general slowdown in the Company's
industry or in economic conditions in the United States or the World.
2.8 Brokers. The Company has no contract, arrangement or understanding with any
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broker, finder or similar agent with respect to the transactions contemplated by
this Agreement other than agreements with Fir Tree, Inc. d/b/a Fir Tree
Partners, and Zolfo Xxxxxx, LLC, copies of which are annexed hereto as Exhibits
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D and E.
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2.9 Private Offering. Assuming the correctness of the representations and
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warranties set forth in Article III hereof, the offer and sale of the Senior
Notes and the Warrants to the Holders hereunder is exempt from registration
under the Securities Act of 1933, as amended (the "Securities Act"). The Company
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has complied and will comply with all applicable federal and state securities
laws in connection with the offer, issuance and sale of the Securities.
ARTICLE III - REPRESENTATIONS AND WARRANTIES OF THE HOLDERS
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Each Holder,severally, and not jointly, represents and warrants to the
Company that:
3.1 Authorization; Non-Violation. The execution and delivery by such Holder of
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this Agreement, and the performance by such Holder of its obligations hereunder,
(i) have been duly authorized by all requisite action (corporate or otherwise)
and constitute the legal, valid and binding obligation of such Holder,
enforceable against it in accordance with the terms herein, (ii) will not
violate any provision of law, any order of any court or other agency of
government, the certificate of incorporation or the by-laws of such Holder, as
amended, or any provision of any indenture, agreement or other instrument to
which such Holder or any of its properties or assets is bound, or conflict with,
result in a breach of, constitute (with due notice or lapse of time or both) a
default under, accelerate or terminate any such indenture, agreement or other
instrument, or result in the creation or imposition of any lien, charge,
restriction, claim or encumbrance of any nature whatsoever upon any of the
properties or assets of such Holder and (iii) other than as set forth on
Schedule 3.1 hereto, will not require any notice, consent or waiver under any
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material indenture, agreement or other instrument to which such Holder is a
party or by which any of its properties or assets are bound, other than such
notice, consent or waiver as shall have previously been obtained.
3.2 Ownership and Title. The Subordinated Notes in the principal amount set
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forth opposite each Holder's name on Schedule I hereto are the only Subordinated
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Notes of the Company held by such Holder. Each Holder owns and has good and
marketable title in such Subordinated Notes and, except as set forth in the
Indenture, holds such
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Subordinated Notes free and clear of all liens, charges, encumbrances, debt,
restrictions, rights, claims, options to purchase or calls or commitments of any
kind.
3.3 Accredited Investor. Such Holder is an "accredited investor" within
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the meaning of Rule 501 of Regulation D promulgated under the Securities Act and
was not organized for the specific purpose of acquiring the Senior Notes or the
Warrants.
3.4 Knowledge and Experience. (a) Such Holder has sufficient knowledge
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and experience in investing so as to be able to evaluate the risks and merits of
its investment in the Company and it is able financially to bear the risks
thereof; and (b) such Holder acknowledges and agrees that it had reasonable time
and opportunity to ask questions of and receive answers from the Company's
management concerning the business and affairs of the Company and to obtain any
additional information from the Company that was necessary for it to evaluate
the risks and merits of an investment in the Company, provided, that such
investigation shall not impair Holder's ability to rely on the Company's
representations and warranties contained in this Agreement.
3.5 Investment Purposes. The Senior Notes and the Warrants being purchased by
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such Holder are being acquired for its own account for the purpose of investment
and not with a view to or for sale in connection with any distribution thereof,
except in accordance with the Securities Act and the rules and regulations
promulgated thereunder and all applicable state securities or blue sky laws.
3.6 Private Offering. Such Holder acknowledges and understands that (a) the
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Securities have not been registered under the Securities Act by reason of their
issuance in a transaction exempt from the registration requirements of the
Securities Act and the Company's reliance on such exemption is predicated, in
part, upon such Holder's representations set forth in this Article III, (b) the
Securities must be held indefinitely unless a subsequent disposition thereof is
registered under the Securities Act and all applicable state securities and
"blue sky" laws or unless such disposition is exempt from such registration, (c)
the Securities will bear a legend to such effect and (d) the Company will make a
notation on its transfer books to such effect.
3.7 Disclosure Matters. (a) Such Holder acknowledges that it was informed
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by the Company and it is aware of the fact that the Company may not have
sufficient cash to continue its operations beyond December 31, 2001, nor to
finance and close the exchange provided for herein, if it fails to obtain
additional funding through the sale of business divisions and/or assets
(including the sale of the Company's retail web hosting division, which may or
may not occur), obtaining equity financing or incurring additional debt, and
that no assurance can be given that the Company will be able to obtain such
additional funding. (b) Such Holder acknowledges that it was informed by the
Company and it is aware that (i) the total stockholders' equity and the per
share price of the Company's Common Stock had fallen below the minimum continued
listing requirements of the Nasdaq National Market on which the Common Stock is
currently listed, (ii) Nasdaq implemented a moratorium on such continued listing
requirements
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until January 2, 2002 and as a result the Company is qualified for listing until
at least such date, and (iii) the Company may be delisted from Nasdaq after the
end of such moratorium period if it does not comply with the continued listing
requirements then in effect. (c) Such Holder acknowledges that it was informed
by the Company and it is aware that the Company and Microsoft Corporation
("Microsoft") intend to enter into an agreement (the "Microsoft Agreement")
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pursuant to which the Company will repurchase from Microsoft $10 million
principal amount of Subordinated Notes owned by Microsoft for approximately
$900,000 in cash, provided, however, that the closing of the Microsoft Agreement
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shall not occur prior to the earlier of the Closing Date and December 31, 2001.
(d) Such Holder acknowledges that in connection with the transactions
contemplated by this Agreement, the conversion price of $19 million aggregate
principal amount of the Company's 8% Convertible Subordinated Notes due 2003
which are held by Charterhouse Equity Partners III, L.P., Softbank Technology
Ventures VI L.P. and their respective affiliates, is being reduced from $1.10
per share to $1.00 per share and the exercise price of outstanding warrants to
purchase 5,181,870 shares of Common Stock which are held by Charterhouse Equity
Partners III, L.P., Softbank Technology Ventures VI L.P. and their respective
affiliates, is being reduced from $1.25 per share to $0.60 per share. (e) Such
Holder acknowledges that the Company intends to commence the Exchange Offer
pursuant to which the holders (other than the Holders) of the Subordinated Notes
shall be offered the same or less consideration for their Subordinated Notes as
provided for in this Agreement.
3.8 Brokers. Such Holder has no contract, arrangement or understanding with any
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broker, finder or similar agent with respect to the transactions contemplated by
this Agreement.
ARTICLE IV - COVENANTS OF THE HOLDERS
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Each Holder, severally, and not jointly, covenants with the Company as
follows.
4.1 Rule 144A. Each Holder, severally, and not jointly, hereby covenants and
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agrees that in the event such Holder sells any Senior Notes, PIK Notes or
Warrants pursuant to Rule 144A promulgated under the Securities Act, such Holder
shall (i) obtain on behalf of the Company information to enable the Company to
establish a reasonable belief that the purchaser is a qualified institutional
buyer and (ii) advise such purchaser that Rule 144A is being relied upon with
respect to such resale.
4.2 Forbearance. Each Holder hereby agrees not to accelerate or demand
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payment of any principal amount of Subordinated Notes owned by such Holder or
any interest thereon and not to take any other actions against the Company due
to, or in connection with the Company's default under the Indenture until the
earlier of the termination of the Exchange Offer without any Subordinated Notes
having been purchased thereunder by the Company and December 31, 2001.
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4.3 Restrictions on Transfer. Each Holder, severally, and not jointly, hereby
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covenants and agrees that such Holder shall not, directly or indirectly,
transfer, sell or otherwise dispose of (collectively, "Transfer") any Security
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unless (a) such Transfer is pursuant to an effective registration statement
under the Securities Act; or (b) such Transfer is pursuant to an exemption from
registration under the Securities Act and any state securities or "blue sky"
laws.
4.4 Notice of Transfer. Prior to a proposed Transfer of any Security without
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registration under the Securities Act, the Holder shall give notice to the
Company of its intention to effect such Transfer. The notice shall describe in
reasonable details the manner and circumstances of the proposed Transfer and
shall be accompanied by an opinion of counsel reasonably satisfactory to the
Company that the proposed Transfer may be effected without such registration. In
addition, each Holder shall cause any transferee of the Securities, as a
condition to the consummation of such transfer, to agree to be subject to the
provisions of this Agreement.
4.5 No Exclusivity. The restrictions on Transfer contained herein shall not be
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exclusive and each Holder shall be subject to any other provisions or
restrictions on Transfer contained in any other documents in connection with the
Securities.
ARTICLE V - CONDITIONS TO CLOSING OF THE COMPANY
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The obligation of the Company to consummate the recapitalization and exchange
contemplated by this Agreement shall be subject to the fulfillment prior to the
Closing of the following conditions, any or all of which may be waived by the
Company to the extent permitted by applicable law:
5.1 Representations and Warranties. On and as of the date of the Closing, the
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representations and warranties of each of the Holders set forth in this
Agreement shall be true and correct in all material respects.
5.2 Performance of Obligations. Each Holder shall have performed or complied
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in all material respects with all conditions, agreements, obligations and
covenants required to be performed or complied with by such Holder under this
Agreement prior to the Closing.
5.3 Officer Certificate. The Company shall have received a certificate dated as
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of the date of the Closing executed by a senior officer of each Holder
certifying that, to such officer's knowledge, the conditions specified in
Sections 5.1 and 5.2 have been fulfilled.
5.4 Registration Rights Agreement. Each Holder shall have executed and
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delivered to the Company the Rights Agreement.
5.5 Stockholders' Approval or Waiver. The Company shall have obtained the
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approval of the stockholders of the Company, or a waiver from the National
Association
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of Securities Dealers Automated Quotation System ("Nasdaq") of the requirement
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to obtain such approval, for the issuance, pursuant to this Agreement, of the
Senior Notes, the PIK Notes and the Warrants, which are convertible into or
exercisable for 20% or more of the issued and outstanding Common Stock of the
Company as of the date of this Agreement.
5.7 Completion of Tender. The Company shall have completed the Tender Offer and
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the Company shall have purchased thereunder and/or under the Microsoft Agreement
an aggregate of not less than $13,186,000 million, or 8%, principal amount of
Subordinated Notes prior to December 31, 2001.
ARTICLE VI - CONDITIONS TO CLOSING OF THE HOLDERS
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The obligations of each of the Holders to consummate the recapitalization and
exchange contemplated by this Agreement shall be subject to the fulfillment
prior to the Closing of the following conditions, any or all of which may be
waived by the Holders to the extent permitted by applicable law:
6.1 Representations and Warranties. On and as of the date of the Closing, the
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representations and warranties of the Company set forth in this Agreement shall
be true and correct in all material respects.
6.2 Performance of Obligations. The Company shall have performed or complied
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in all material respects with all conditions, agreements, obligations and
covenants required to be performed or complied with by the Company under this
Agreement prior to the Closing.
6.3 Officer Certificate. Each Holder shall have received a certificate dated as
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of the date of the Closing executed by a senior officer of the Company
certifying that, to such officer's knowledge, the conditions specified in
Sections 6.1 and 6.2 have been fulfilled.
6.4 Registration Rights Agreement. The Company shall have executed and
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delivered to each Holder the Rights Agreement.
6.5 Stockholders' Approval or Waiver. The Company shall have obtained the
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approval of the stockholders of the Company, or a waiver from Nasdaq of the
requirement to obtain such approval, for the issuance, pursuant to this
Agreement, of the Senior Notes, the PIK Notes and the Warrants, which are
convertible into or exercisable for 20% or more of the issued and outstanding
Common Stock of the Company as of the date of this Agreement.
6.7 Completion of Tender. The Company shall have completed the Tender Offer and
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the Company shall have purchased thereunder and/or the Microsoft Agreement an
aggregate of not less than $13,186,000 million, or 8% principal amount of
Subordinated Notes prior to December 31, 2001.
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6.8 Opinion of Counsel. The Company shall have obtained an opinion of counsel
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to the Company in form and substance reasonably satisfactory to the Holders with
respect to the Senior Notes, stating among other things, that the Senior Notes
have been duly authorized, executed and delivered by the Company and are
enforceable against the Company in accordance with their terms, that the
Conversion Shares and the Warrant Shares have been duly reserved for issuance,
and that the issuance of the Senior Notes, the Warrants and the Conversion
Shares is exempt from registration under the Securities Act.
ARTICLE VII - MISCELLANEOUS
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7.1 Legend. Each Holder acknowledges and agrees that each certificate
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representing the Securities shall bear substantially the legend set forth below:
"THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED, OR UNDER ANY APPLICABLE STATE SECURITIES
LAWS AND NEITHER THE SECURITIES NOR ANY INTEREST THEREIN MAY BE SOLD,
TRANSFERRED, PLEDGED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH
REGISTRATION OR AN EXEMPTION FROM REGISTRATION UNDER SUCH ACT AND THE RULES AND
REGULATIONS THEREUNDER AND IN THE ABSENCE OF REGISTRATION OR AN EXEMPTION FROM
REGISTRATION UNDER ANY APPLICABLE STATE SECURITIES LAWS."
7.2 Survival of Agreements. All covenants, agreements, representations and
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warranties made herein shall survive the execution and delivery of this
Agreement, the issuance, sale and delivery of the Securities.
7.3 Further Actions. At any time and from time to time, each party agrees,
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without further consideration, to take such actions and to execute and deliver
such documents as may be necessary or desirable to effectuate the purposes of
this agreement.
7.4 Binding Effect; Successors and Assigns. This Agreement will be binding upon
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and inure to the benefit of the parties hereto and their respective successors
and permitted assigns.
7.5 Brokerage. Each party hereto will indemnify and hold harmless the other
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against and in respect of any claim for brokerage or other commissions relative
to this Agreement or to the transactions contemplated hereby, based in any way
on agreements, arrangements or understandings made or claimed to have been made
by such party with any third party.
7.6 Notices. All notices, requests, consents and other communications
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hereunder shall be in writing and shall be delivered in person, mailed
by certified or registered mail,
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return receipt requested, or by facsimile transmission (electronic confirmation
of receipt required), addressed as follows:
if to the Company:
Xxx Xxxxxxxxxxxxxx Xxxx
Xxxxxxxx, Xxx Xxxx 00000
Attention: General Counsel
Tel: (000) 000-0000
Facsimile: (000) 000-0000
With a copy to:
Proskauer Rose LLP
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx X. Xxxxx, Esq.
Tel: (000) 000-0000
Facsimile: (000) 000-0000
if to any Holder:
At the address of such Holder set forth in
Schedule 1.
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With a copy to:
Akin, Gump, Strauss, Xxxxx & Xxxx, L.L.P.
0000 Xxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Attention: Xxxxx X. Xxxxxxxx
Tel: (000) 000-0000
Facsimile: (000) 000-0000
or, in any such case, at such other address or addresses as shall have been
furnished in writing by such party to the others.
Each such notice, request, consent or other communication shall be treated as
having been given when delivered if delivered personally or by overnight
courier, upon confirmation of receipt if sent by facsimile or three business
days after being sent by registered mail.
7.7 Governing Law. This Agreement shall be governed by and construed in
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accordance with the laws of the internal laws of the State of New York, without
regard to the conflicts of laws provisions thereof.
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7.8 Entire Agreement. This Agreement, including the Schedules and Exhibits
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hereto, constitutes the sole and entire agreement of the parties with respect to
the subject matter hereof.
7.9 Counterparts. This Agreement may be executed in two or more counterparts,
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each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument.
7.10 Amendments. This Agreement may not be amended or modified, and no
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provisions hereof may be waived, without the written consent of the Company and
each Holder.
7.11 Severability. If any provision of this Agreement shall be
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declared void or unenforceable by any judicial or administrative authority, the
validity of any other provision and of the entire Agreement shall not be
affected thereby.
7.12 Expenses. The reasonable fees and expenses of counsel for Holders with
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regard to this Agreement and the other Transaction Documents, not to exceed
$50,000, shall be paid by the Company on the earlier of the Closing Date and
December 31, 2001; provided, however, that the foregoing payment shall be in
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addition to, and not in lieu of, the fees and expenses payable by the Company to
the Holders pursuant to the terms of Section 4 of the Rights Agreement.
7.13 Equitable Remedy. The parties hereby agree that a breach of the provisions
----------------
of this Agreement could not adequately be compensated by money damages, and that
each party shall be entitled, in addition to any other right or remedy available
to it, to an injunction restraining such breach or threatened breach and to
specific performance of any such provision of this Agreement, and in either case
no bond or other security shall be required in connection therewith, and the
parties hereby consent to the issuance of such an injunction and to the ordering
of specific performance.
7.14 No Disclosure. The Company shall not make any press release or similar
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public announcement concerning this Agreement that includes the name of a Holder
without such Holder's prior written consent, unless such disclosure is required
by any applicable law, the rules and regulations of any self-regulatory
organization or any governmental agency. The Holders acknowledge that the
Company's obligations hereunder shall not apply to any required filings with the
Securities and Exchange Commission or Nasdaq.
7.15 Titles and Subtitles. The titles and subtitles used in this Agreement are
--------------------
for convenience only and are not to be considered in construing or interpreting
any term or provision of this Agreement.
[Remainder of the page intentionally left blank]
12
IN WITNESS WHEREOF, the Company and the Holders have executed this
Recapitalization and Exchange Agreement as of the day and year first above
written.
INTERLIANT, INC.
By: /s/ Xxxxxxx X. Xxxxxx
---------------------
Name: Xxxxxxx X. Xxxxxx
Title: Chief Financial Officer
HOLDERS
BNP PARIBAS EQUITY STRATEGIES, S.N.C.
By: /s/ Xxxxxx X. Xxxxxxx
---------------------
Name: Xxxxxx X. Xxxxxxx
Title: Chief Operating Officer
CAMDEN ASSET MANAGEMENT
By: /s/ Xxxxxx X. Xxxxxxx
---------------------
Name: Xxxxxx X. Xxxxxxx
Title: Partner and PM
TRIBECA INVESTMENTS, LLC
By: /s/ Tian Xue
------------
Name: Tian Xue
Title: Vice President
XXXXXXX CAPITAL [LLC]
By: /s/ Xxxx Xxxxxxxx
-----------------
Name: Xxxx Xxxxxxxx
Title: Managing Director
13
FIR TREE VALUE FUND, LTD.;
FIR TREE INSTITUTION VALUE FUND, L.P.
FIR TREE VALUE PARTNERS, LTD.; and
FIR TREE RECOVERY FUND, L.P.
By: /s/ Xxxxx Xxxxxx
----------------
Name: Xxxxx Xxxxxx
Title: Vice President
JMG/TRITON OFFSHORE FUND, LTD.
By: /s/ Xxxxx Xxxxxxxxxx
--------------------
Name: Xxxxx Xxxxxxxxxx
Title: Fund Manager
HARVARD MANAGEMENT COMPANY, INC.
(d/b/a President And Fellows of Harvard College)
By: /s/ Xxxxxxx X. Xxxxxx
---------------------
Name: Xxxxxxx X. Xxxxxx
Title: Authorized Signatory
By: /s/ Xxxxxxx X. XxXxxxxxx
------------------------
Name: Xxxxxxx X. XxXxxxxxx
Title: Authorized Signatory
R2 INVESTMENTS, LDC
By: Amalgamated Gadget, L.P., as
Investment Manager of R2 Investments, LDC
By: Scepter Holdings, Inc., its General Partner
By: /s/ Xxxxxx XxXxxxxxx
--------------------
Xxxxxx XxXxxxxxx, Vice President
14
LIST OF SCHEDULES AND EXHIBITS
------------------------------
SCHEDULES*
----------
Schedule I Name and Holdings of Subordinated Noteholders
Schedule II Exchange Consideration
Schedule 2.2 Certain Registration Rights Agreements between the Company and
other parties
Schedule 2.6A Capitalization Table as of September 30, 2001
Schedule 2.6B Existing Securities and Agreements Affecting the Company's
Common Stock
Schedule 2.7 Changes in Financial Condition of Company since September 30,
2001
Schedule 3.1 Required Notices or Consents
EXHIBITS*
---------
Exhibit A Form of Senior Notes
Exhibit B Form of Warrants
Exhibit C Form of Registration Rights Agreement
Exhibit D Agreement dated September 10, 2001 between the Company and
Fir Tree, Inc.
Exhibit E Agreement dated September 10, 2001 between the Company and
Zolfo Xxxxxx, LLC
--------------------------------------------------
* Interliant, Inc. will provide the Securities and Exchange Commission with the
schedules and exhibits listed above upon request
15
