EXHIBIT 4.3
EXECUTION COPY
WARRANT AGREEMENT
THIS WARRANT AGREEMENT is made as of March 7, 2002, by and between
General Electric Capital Corporation, a Delaware corporation ("GECC" or the
"Investor", as further defined in Section 1.1) and SAVVIS Communications
Corporation, a Delaware corporation (the "Company").
RECITALS
A. GECC and the Company are parties to that certain Master Lease
Agreement No. 6857500, dated as of March 28, 2000, as amended (the "Master Lease
Agreement").
B. GECC and the Company have entered into an Amended and Restated
Master Lease Agreement dated as of the date hereof (the "Amended Master Lease
Agreement"), and in consideration for such amendment the Company has agreed to
grant to GECC the warrants described in this Agreement (as defined below).
C. GECC and the Company have agreed to enter into an Investor Rights
Agreement dated as of the date hereof (the "Investor Rights Agreement").
In consideration of the terms and conditions contained herein and other
good and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties, intending to be legally bound hereby, agree as
follows:
AGREEMENT
ARTICLE I. GENERAL DEFINITIONS
SECTION 1.1 DEFINED TERMS. Capitalized terms, when used herein, shall
have the following meanings:
"Additional Shares of Common Stock" means any shares of Common Stock
issued (or deemed to have been issued pursuant to Section 5.3(f)(ii)) by the
Company other than: (a) Common Stock issued pursuant to a transaction described
in Section 5.3(a) or 5.3(b), (b) shares of Common Stock issued or issuable upon
conversion of the Company's Series A Convertible Redeemable Preferred Stock, (c)
in addition to the shares of Common Stock described in (d) below, shares of
Common Stock or options, warrants or similar rights to purchase shares of Common
Stock, which shares are issuable or issued to employees, consultants or
directors of the Company directly or pursuant to a stock option, restricted
stock, employee stock purchase or similar plan approved by the Board of
Directors of the Company, (d) shares of Common Stock issued or issuable upon
conversion of all securities convertible, exchangeable or exercisable for, or
rights to purchase, shares of Common Stock validly issued and outstanding as of
the Closing Date, and (e) shares of Common Stock issued or issuable upon
exercise of the Warrants and the warrants issued to Nortel Networks, Inc. on the
Closing Date (the "Nortel Warrant").
"Affiliate" means, as to any Person, any other Person (a) that directly
or indirectly, through one or more intermediaries, controls or is controlled by,
or is under common control with, such Person; (b) that directly or indirectly
beneficially owns or holds five percent (5%) or more of any class of voting
Capital Stock of such Person; or (c) five percent (5%) or more of the voting
Capital Stock of which is directly or indirectly beneficially owned or held by
the Person in question. For purposes of this definition, the term "control"
means the possession, directly or indirectly, of the power to direct or cause
direction of the management and policies of a Person, whether through the
ownership of voting securities, by contract or otherwise; provided, however,
that in no event shall an Investor or a Holder of a Warrant or Common Stock
issued upon exercise of a Warrant be deemed for purposes of this Agreement to be
an Affiliate of the Company.
"Agreement" means this Warrant Agreement, including any and all
exhibits and schedules hereto, as the same may be from time to time amended,
modified or supplemented.
"Amended Master Lease Agreement" has the meaning set forth in the
Recitals.
"Business Day" means any day that is not a Saturday, Sunday or other
day on which commercial banks in New York City are authorized or required by law
to remain closed.
"Capital Stock" means, as to any entity (whether a corporation, a
partnership or another entity), corporate stock and any and all shares,
partnership interests, limited partnership interests, limited liability company
interests, membership interests, equity interests, participations, rights or
other equivalents (however designated) of corporate stock or any of the
foregoing issued by such entity.
"Closing" means the issuance of the Warrants on the Closing Date. The
Closing shall take place at the offices of Winston & Xxxxxx, 000 Xxxx Xxxxxx,
Xxx Xxxx, XX 00000 or at such other place as may be mutually agreed upon by the
Investor and the Company.
"Closing Date" means the Closing Date as defined in the Amended Master
Lease Agreement, upon and as of which the Series A Convertible Redeemable
Preferred Stock is issued by the Company pursuant to the Securities Purchase
Agreement, and all other conditions precedent to GECC's obligations under the
Amended Master Lease Agreement have been satisfied.
"Closing Market Price" means, on any trading day, the last sale price
for shares of Common Stock on such day as reported in the Consolidated Last Sale
Reporting System or as quoted in the National Association of Securities Dealers
Automated Quotation System, or if such last sale price is not available, the
average of the closing bid and asked prices as reported in either such system,
or in any other case the higher bid price quoted for such day as reported by The
Wall Street Journal and the National Quotation Bureau pink sheets.
"Common Stock" means the Company's common stock, par value $.01 per
share, as such stock is constituted on the Closing Date, any stock into which
such stock shall be changed, converted or exchanged and any stock resulting from
reclassification of such stock.
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"Company" means SAVVIS Communications Corporation, a Delaware
corporation.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Exercise Price" has the meaning(s) set forth in the Warrant(s).
"Expiration Date(s)" has the meaning(s) set forth in the Warrant(s).
"Financial Statements" has the meaning specified in Section 2.9.
"Fundamental Change" means any transaction or event, including, without
limitation, any merger, consolidation, sale of assets, reclassification,
recapitalization, compulsory share exchange or liquidation, in which all or
substantially all outstanding shares of the Company's Common Stock are converted
into or exchanged for stock, other securities or assets.
"GAAP" means generally accepted accounting principles, applied on a
consistent basis, as set forth in the Opinions of the Accounting Principles
Board of the American Institute of Certified Public Accountants and/or in
statements of the Financial Accounting Standards Board and/or their respective
successors and which are applicable to the circumstances as of the date in
question. Accounting principles are applied on a "consistent basis" when the
accounting principles applied in a current period are comparable in all material
respects to those accounting principles applied in a preceding period.
"GECC" means General Electric Capital Corporation, a Delaware
corporation.
"Governmental Authority" means any nation or government, any state,
provincial or political subdivision thereof and any entity exercising executive,
legislative, judicial, regulatory or administrative functions of or pertaining
to government.
"Governmental Requirement" means any law, statute, code, ordinance,
order, rule, regulation, judgment, decree, injunction, franchise, Permit,
certificate, license, authorization or other directive or requirement of any
Governmental Authority.
"Holder" means any Person (including, without limitation, the Investor)
who acquires Warrants or Warrant Stock, including any transferees of Warrants or
Warrant Stock; provided, however, that a holder of Warrant Stock purchased
pursuant to an effective registration statement or pursuant to a sale conducted
in accordance with Rule 144 of the Securities Act shall not be deemed a Holder.
"Intellectual Property" means any U.S. or foreign patents, patent
applications, trademarks, trade names, service marks, brand names, logos and
other trade designations (including unregistered names and marks), trademark and
service xxxx registrations and applications, copyrights and copyright
registrations and applications, inventions, invention disclosures, protected
formulae, formulations, processes, methods, trade secrets, computer software,
computer
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programs and source codes, manufacturing research and similar technical
information, engineering know-how, customer and supplier information, assembly
and test data drawings or royalty rights.
"Investor" means GECC and its permitted successors and assigns.
"Investor Rights Agreement" means that certain Investor Rights
Agreement of even date herewith by and among the Company, Welsh, Carson,
Xxxxxxxx & Xxxxx VIII, L.P., Reuters Holdings Switzerland, SA., Nortel Networks,
Inc., GECC and the other parties thereto.
"Lien" means any lien, mortgage, interest, security interest, tax lien,
financing statement, pledge, charge, hypothecation or other encumbrance of any
kind or nature whatsoever (including, without limitation, any conditional sale
or title retention agreement), whether arising by contract, operation of law or
otherwise.
"Material Adverse Effect" means any material adverse effect on, or the
occurrence of any event or the existence of any condition that could reasonably
be expected to have a material adverse effect on the assets, properties,
business, operating results, financial condition or performance of the Company
and its Subsidiaries, taken as a whole.
"Nortel Warrant Agreement" means that certain Warrant Agreement of even
date herewith by and between the Company and Nortel Networks, Inc.
"Nortel Warrants" means the Warrants issued to Nortel by the Company
pursuant to the Nortel Warrant Agreement.
"Other Equity Documents" means the Company's Stock option plan(s), the
certificate of incorporation of the Company, the bylaws of the Company and any
other instrument or document of organization or governance of the Company.
"Permit" means any permit, certificate, approval, order, license or
other authorization.
"Person" means and includes natural persons, corporations, limited
partnerships, limited liability companies, general partnerships, joint stock
companies, joint ventures, associations, companies, trusts, banks, trust
companies, land trusts, business trusts or other organizations, whether or not
legal entities, and Governmental Authorities.
"Property" means property or assets of all kinds, real, personal or
mixed, tangible or intangible (including, without limitation, all rights
relating thereto), whether owned or acquired on or after the Closing Date.
"SEC" means the Securities and Exchange Commission.
"SEC Documents" has the meaning specified in Section 2.9.
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"Securities Act" means the Securities Act of 1933, as amended.
"Securities Purchase Agreement" means that certain Securities Purchase
Agreement of even date herewith by and among the Company, Welsh, Carson,
Xxxxxxxx & Xxxxx VIII, L.P. ("WCAS VIII") and other entities and individuals
affiliated with WCAS VIII, and all ancillary documents contemplated thereby,
including among others the Investor Rights Agreement.
"Series A Convertible Redeemable Preferred Stock" means those
securities issued pursuant to the Securities Purchase Agreement.
"Stockholder" means any Person who directly or indirectly owns any
shares of Common Stock (including Warrant Stock).
"Subsidiary" or "Subsidiaries" means, with respect to any Person, any
corporation or other entity of which at least a majority of the outstanding
shares of stock or other ownership interests having by the terms thereof
ordinary voting power to elect a majority of the board of directors (or Persons
performing similar functions) of such corporation or entity (irrespective of
whether or not at the time, in the case of a corporation, stock of any other
class or classes of such corporation shall have or might have voting power by
reason of the happening of any contingency) is, at the time, directly or
indirectly owned or controlled by such Person and/or one or more of its
Subsidiaries.
"Volume-Weighted Market Value" means, at any date, the price per share
of Common Stock which equals (i) the sum of the products, for each of the prior
20 trading days, of the Closing Market Price on such day, multiplied by the
volume of shares traded on such day, (ii) divided by the total volume of shares
traded the prior 20 trading days. If no Closing Market Price for shares of
Common Stock can be determined, the Volume-Weighted Market Value shall be the
fair market value thereof as reasonably determined in good faith by the Board of
Directors of the Company.
"Warrant" and "Warrants" means (i) the Warrants issued to the Investor
by the Company pursuant to this Agreement, substantially in the form of Exhibit
A attached hereto, and which in the aggregate evidence the right the purchase
shares of Common Stock which represents as of the Closing Date, three percent
(3%) of the outstanding shares of Common Stock of the Company on a fully diluted
and as converted basis (taking into account the issuance of the Series A
Convertible Redeemable Preferred Stock, the Warrants and the Nortel Warrants,
but not taking into account the issuance of Series A Convertible Redeemable
Preferred Stock pursuant to Section 1.02(c) of the Securities Purchase
Agreement, options for shares of Common Stock granted by the Company to its
employees prior to the Closing Date and options for shares of Common Stock
proposed to be granted by the Company on or after the Closing Date), and (ii)
all Warrants issued upon transfer, division, combination of, or in substitution
for, any thereof.
"Warrant Stock" means all shares of Common Stock issuable from time to
time upon exercise of a Warrant.
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ARTICLE II. REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company represents and warrants to the Investor that the following
statements are true and correct as of the date hereof and, if indicated, as of
the Closing Date:
SECTION 2.1 EXISTENCE; QUALIFICATION. The Company and each of its
Subsidiaries is duly organized, validly existing and in good standing under the
laws of Delaware. The Company and each of its Subsidiaries is duly qualified,
licensed or admitted to do business and is in good standing as a foreign
corporation in every jurisdiction where the failure to be so qualified would
have a Material Adverse Effect and has all requisite corporate power and
authority to transact its business as now conducted in all such jurisdictions.
SECTION 2.2 NO BREACH. The execution, delivery and, as of the Closing
Date, the performance by the Company of this Agreement and the Warrants, the
completion by it of the transactions contemplated hereby and thereby, and the
performance by the Company of its obligations hereunder and thereunder, will not
(a) violate the certificate of incorporation or bylaws or any other instrument
or document of organization or governance of the Company, (b) violate, or result
in a breach of or default under, any other material instrument or material
agreement to which the Company or any of its Subsidiaries is a party or is
bound, (c) violate any judgment, order, injunction, decree or award against or
binding upon the Company or it Subsidiaries, (d) result in the creation of any
Lien upon any of the properties or assets of the Company or its Subsidiaries, or
(e) violate any law, rule or regulation relating to the Company or any of its
Subsidiaries.
SECTION 2.3 CORPORATE ACTION. The Company has all necessary corporate
power and authority to execute, deliver and perform its obligations under this
Agreement, the Investor Rights Agreement and the Warrants; the execution,
delivery and performance by the Company of this Agreement, the Investor Rights
Agreement and the Warrants, and the performance by the Company of its
obligations hereunder and thereunder, have been duly authorized by all necessary
action (including all Stockholder action, if any) on the part of the Company;
this Agreement, the Investor Rights Agreement and the Warrants have been duly
executed and delivered by the Company and constitute the legal, valid and
binding obligation of the Company, enforceable against the Company in accordance
with their respective terms, except as enforceability may be limited by
bankruptcy, insolvency, or other laws of general application relating to the
enforcement of creditors' rights and general principles of equity; upon
effectiveness (the "Consent Effectiveness Date") of Stockholder Action (as
defined in the certificate of designation relating to the Company's Series A
Convertible Redeemable Preferred Stock), the Warrant Stock shall have been duly
and validly authorized and reserved for issuance and shall, when paid for,
issued and delivered in accordance with the Warrants, be duly and validly
issued, fully paid and nonassessable and free and clear of any Liens; and none
of the Warrant Stock issued pursuant to the terms hereof will be in violation of
any preemptive rights of any Stockholder.
SECTION 2.4 APPROVALS. Other than the filing with the Secretary of
State of Delaware of the certificate of amendment to the Company's certificate
of incorporation increasing the authorized number of shares of Common Stock to
600,000,000, no authorizations, approvals or
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consents of, and no filings or registrations with, any Governmental Authority or
any other Person are necessary for the execution, delivery or performance by the
Company of this Agreement, the Investor Rights Agreement or the Warrants or for
the validity or enforceability thereof as of the date hereof and as of the
Closing Date. Any such action required to be taken as a condition to the
execution and delivery of this Agreement, the Investor Rights Agreement, or the
execution, issuance and delivery of the Warrants, has been duly taken by all
such Governmental Authorities or other Persons, as the case may be.
SECTION 2.5 CAPITALIZATION.
(a) As of the date hereof, the authorized capital stock of the
Company consists of 250,000,000 shares of Common Stock and 50,000,000 shares of
preferred stock, par value $.01 per share (the "Preferred Stock"). As of the
date hereof, 94,733,074 shares of Common Stock and no shares of Preferred Stock
are issued and outstanding (without taking into account the Series A Convertible
Redeemable Preferred Stock to be issued pursuant to the Securities Purchase
Agreement). All outstanding shares of Common Stock have been duly authorized and
validly issued and are fully paid and nonassessable.
(b) As of the date hereof, except for options granted pursuant
to the Company's stock option plan to purchase an aggregate of 7,910,331 shares
of Common Stock and except as set forth on Schedule 2.5(b), no subscription,
warrant, option, convertible security, stock appreciation or other right
(contingent or other) to purchase or acquire any shares of any class of capital
stock of the Company or any of its Subsidiaries is authorized or outstanding,
and (except as otherwise expressly contemplated by this Agreement or the
Securities Purchase Agreement or the Nortel Warrant Agreement) there is not any
legally binding commitment of the Company or any of its Subsidiaries to issue
any shares, warrants, options or other such rights or to distribute to holders
of any class of its capital stock, any evidences of indebtedness or assets.
SECTION 2.6 PRIVATE OFFERING. Assuming the truth and accuracy of the
Investor's representations and warranties contained in Section 5.2, the issuance
and sale of the Warrants to the Holders hereunder are exempt from the
registration and prospectus delivery requirements of the Securities Act.
SECTION 2.7 LITIGATION. There is no action, suit, proceeding or
investigation pending or, to the knowledge of the Company, threatened against
the Company or any of its Subsidiaries before any Governmental Authority seeking
to enjoin the transactions contemplated by this Agreement or the Warrants.
SECTION 2.8 BROKERS. The Company has not incurred (and will not incur)
any unpaid liability to any broker, finder or agent for any brokerage fees,
finders' fees or commissions in connection with the transactions expressly
contemplated by this Agreement with respect to which the Investor or any other
Holder would be liable.
SECTION 2.9 SEC DOCUMENTS; FINANCIAL STATEMENTS. The Company has filed
in a timely manner all documents that the Company was required to file with the
Commission under
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Sections 13, 14(a) and 15(d) of the Exchange Act since its initial public
offering. As of their respective filing dates, all documents filed by the
Company with the Commission ("SEC Documents") complied with the requirements of
the Exchange Act or the Securities Act, as applicable. None of the SEC Documents
as of their respective dates contained any untrue statement of a material fact
or omitted to state a material fact required to be stated therein or necessary
to make the statements made therein, in light of the circumstances under which
they were made, not misleading. The financial statements of the Company included
in the SEC Documents (the "Financial Statements") comply as to form with
applicable accounting requirements and with the published rules and regulations
of the Commission with respect thereto. The Financial Statements have been
prepared in accordance with GAAP and fairly present in all material respects the
consolidated financial position of the Company and its Subsidiaries at the dates
thereof and the consolidated results of their operations and consolidated cash
flows for the periods then ended (subject, in the case of unaudited statements,
to normal, year-end adjustments and the absence of footnotes).
SECTION 2.10 AMENDED MASTER LEASE AGREEMENT REPRESENTATIONS AND
WARRANTIES. The representations and warranties made by the Company in any
"Credit Document" (as such term is defined in the Amended Master Lease
Agreement) or that are contained in any exhibit, certificate, document or
financial or other statement of the Company furnished under or in connection
with the Amended Master Lease Agreement are true and correct as of the date
hereof as if made again on and as of the date hereof and as of the Closing Date
(except if and to the extent that such representations and warranties are or
were expressly made only as of another specific date).
ARTICLE III. AFFIRMATIVE COVENANTS
The Company hereby covenants and agrees that, as long as the Investor
holds the Warrants or Warrant Stock, it will perform and observe the following
covenants:
SECTION 3.1 INSPECTION RIGHTS. The Company and each of its Subsidiaries
will permit representatives and agents of the Investor, during normal business
hours and upon reasonable notice, to examine, copy and make extracts from its
books and records, to visit and inspect its Properties and to discuss its
business, operations and financial condition with its officers and independent
certified public accountants, subject to any applicable securities laws.
SECTION 3.2 FINANCIAL STATEMENTS, ETC. The Company agrees that it will
file the reports required to be filed by it under the Securities Act and the
Exchange Act so long as the Company is registered under the Exchange Act. Upon
request of any Investor, the Company will deliver to such Investor a written
statement that it has complied with such requirements.
SECTION 3.3 RESTRICTIONS ON PERFORMANCE. The Company shall not at any
time enter into an agreement or other instrument limiting in any manner its
ability to perform its obligations under this Agreement or the Warrants, or
making such performance of the issuance of Common Stock upon exercise of any
Warrant a default under any such agreement or instrument.
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SECTION 3.4 MODIFICATION OF OTHER EQUITY DOCUMENTS. The Company shall
not amend or consent to any modification, supplement or waiver of any provision
of any Other Equity Documents in any manner which would limit the Company's
ability to perform its obligations with respect to the Warrants or Warrant
Stock, in each case without the prior written consent of the Investor. Without
limiting the generality of the foregoing, the Company shall not amend, or
consent to any modification, supplement or waiver of any provision of any Other
Equity Documents in a way which would (i) restrict the transferability of the
Warrants or the Warrant Stock, (ii) restrict the transferability of the rights
of the Investor in this Agreement to any transferee of all or a portion of the
Investor's Warrants and/or Warrant Stock or (iii) require any consent or other
approval of any Person to the exercise of the Warrants by the Investor or the
issuance of Warrant Stock upon such exercise.
SECTION 3.5 RESERVE FOR WARRANT STOCK. The Company shall, at all times
from and after the Consent Effectiveness Date prior to the applicable Expiration
Date, reserve and keep available out of its authorized but unissued shares of
Common Stock, for the purpose of effecting the exercise of the Warrants and
otherwise complying with terms of this Agreement, such number of its duly
authorized shares of Common Stock as shall be sufficient to effect the exercise
of the Warrants from time to time outstanding or otherwise to comply with the
terms of this Agreement. If at any time from and after the Consent Effectiveness
Date the number of authorized but unissued shares of Common Stock shall not be
sufficient to effect the exercise of the Warrants or otherwise to comply with
the terms of this Agreement, the Company shall forthwith use commercially
reasonable efforts to take such corporate action as may be necessary to increase
its authorized but unissued shares of Common Stock to such number of shares as
shall be sufficient for such purposes. The Company shall use commercially
reasonable efforts to obtain any authorization, consent, approval or other
action by or make any filing with any court or administrative body that may be
required under applicable state securities laws in connection with the issuance
of shares of Common Stock upon exercise of the Warrants.
SECTION 3.6 NOTICE OF EXPIRATION DATE. The Company shall give the
Investors notice of the Expiration Date(s). Such notice may be given by the
Company not less than 30 days but not more than 60 days prior to an Expiration
Date; provided, however, that if the Company fails to give timely notice, such
Expiration Date will be extended to the date which is 30 days after the day on
which such notice is given.
ARTICLE IV. INVESTORS' ADDITIONAL RIGHTS
SECTION 4.1 EXCHANGE OF CERTIFICATES FOR WARRANTS. Each certificate for
Warrants or Warrant Stock may be exchanged, at the option of the Holder thereof,
and upon surrender of such certificate to the Company, for another certificate
for Warrants, or other certificates for Warrants of different denominations, of
like tenor and representing in the aggregate the right to purchase a like number
of shares of Warrant Stock. Any Holder desiring to exchange a certificate(s) for
Warrants shall make such request in a writing delivered to the Company, and must
surrender the certificate(s) for Warrants to be so exchanged. Thereupon, the
Company will execute and deliver
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to the Holder a new certificate(s) for Warrants as so requested. The
certificate(s) for Warrants surrendered for exchange will be canceled by the
Company.
SECTION 4.2 TAXES. The Company shall pay all taxes which may be payable
in connection with the execution and delivery of this Agreement or the issuance
of the Warrants and Warrant Stock hereunder or in connection with any
modification of this Agreement or the Warrants, unless such tax is imposed by
law upon the Holder (including, without limitation, federal, state or local
income taxes), in which case such taxes shall be paid by the Holder. The
obligations of the parties under this Section shall survive any redemption,
repurchase or acquisition of Warrants or Warrant Stock by the Company, any
termination of this Agreement, and any cancellation or termination of the
Warrants.
SECTION 4.3 REPLACEMENT OF INSTRUMENTS. Upon receipt by the Company of
evidence reasonably satisfactory to it of the ownership of and the loss, theft,
destruction or mutilation of any certificate or instrument evidencing any
Warrants or Warrant Stock, and
(a) in the case of loss, theft or destruction, of indemnity
reasonably satisfactory to it (provided that if the Common Stock is not at the
time publicly traded and the owner of the same is an Investor or an
institutional lender or investor, its own agreement of indemnity shall be deemed
to be satisfactory), or
(b) in the case of mutilation, upon surrender or cancellation
thereof, the Company, at its expense, shall execute, register and deliver, in
lieu thereof, a new certificate or instrument for (or covering the purchase of)
an equal number of Warrants or Warrant Stock.
ARTICLE V. WARRANTS
SECTION 5.1 ISSUANCE OF WARRANTS. On the Closing Date, the Company
shall issue the Warrants to the Investor. The Warrants shall be exercisable in
whole or in part at any time or from time to time as set forth in the Warrants
for the aggregate number of shares of Common Stock as is set forth in the
Warrants. The number of shares for which the Warrants may be exercisable and the
Exercise Price are subject to adjustment as provided under Section 5.3.
SECTION 5.2 REPRESENTATIONS OF THE INVESTOR. The Investor represents
and warrants to the Company that the following statements are true, correct and
complete as of the date hereof:
(a) The Investor (i) is an "Accredited Investor," as that term
is defined in Regulation D under the Securities Act; (ii) has such knowledge,
skill and experience in business and financial matters, based on actual
participation, that it is capable of evaluating the merits and risks of an
investment in the Company and the suitability thereof as an investment for the
Investor; (iii) has received such documents and information as it has requested
and has had an opportunity to ask questions of representatives of the Company
concerning the terms and conditions of the investment proposed herein, and such
questions were answered to the satisfaction of the Investor; and (iv) is in a
financial position to hold the Warrants and shares of Common Stock issued upon
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exercise thereof for an indefinite time and is able to bear the economic risk
and withstand a complete loss of its investment in the Company.
(b) The Investor is acquiring the Warrants and any Common
Stock issuable upon exercise thereof for investment for its own account and not
with a view to, or for resale in connection with, any distribution thereof in
violation of the Securities Act.
(c) The Investor understands that the Warrant and any Common
Stock issuable upon exercise thereof have not been registered under applicable
state or federal securities laws. The Investor acknowledges that by virtue of
the provisions of certain rules respecting "restricted securities" promulgated
by the SEC, the shares of Common Stock issuable upon the exercise of the Warrant
will be required to be held indefinitely, unless and until registered under the
Securities Act and applicable state securities laws, or unless an exemption from
the registration requirements of the Securities Act and applicable state
securities laws is available, in which case the Investor may still be limited as
to the number of such shares that may be sold. The Investor acknowledges that
the certificates representing the Warrants and any Common Stock issuable upon
exercise thereof will bear a conspicuous legend in substantially the form set
forth below:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER EITHER THE SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT"),
OR APPLICABLE STATE SECURITIES LAWS (THE "STATE ACTS"), AND SHALL NOT
BE SOLD, PLEDGED, HYPOTHECATED, DONATED OR OTHERWISE TRANSFERRED
(WHETHER OR NOT FOR CONSIDERATION) BY THE HOLDER EXCEPT BY REGISTRATION
OR PURSUANT TO AN EXEMPTION FROM REGISTRATION UPON THE ISSUANCE TO THE
COMPANY OF A FAVORABLE OPINION OF COUNSEL OR OTHER EVIDENCE REASONABLY
SATISFACTORY TO THE COMPANY TO THE EFFECT THAT ANY SUCH TRANSFER SHALL
NOT BE A VIOLATION OF THE 1933 ACT AND THE STATE ACTS.
Notwithstanding the foregoing, the certificates representing the Warrants and
any Common Stock issuable upon exercise thereof need not bear the foregoing
legend if (i) such Common Stock has been transferred in accordance with the
provisions of Rule 144 under the Securities Act (or any other rule permitting
public sale without registration under the Securities Act), (ii) the Company
receives an opinion of counsel reasonably satisfactory to the Company to effect
that the holder and any subsequent holder (other than an Affiliate of the
Company) would be entitled to transfer such securities in a public sale without
registration under the Securities Act or (iii) such shares of Common Stock are
sold pursuant to an effective registration statement under the Securities Act.
(d) All action on the part of the Investor necessary for the
acquisition of the Warrants and the consummation of the transactions
contemplated herein has been duly and validly taken, and this Agreement is a
valid and binding obligation of the Investor, enforceable against the Investor
in accordance with its terms, except as limited by bankruptcy, insolvency, or
other laws of general application relating to the enforcement of creditors'
rights and general principles of equity.
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SECTION 5.3 ADJUSTMENTS. If any of the following events shall occur at
any time or from time to time prior to the exercise of a Warrant, the following
adjustments shall be made in the Exercise Price and/or the number of shares then
purchasable upon the exercise of a Warrant, as appropriate:
(a) Stock Splits and Combinations. In case the Company shall
at any time or from time to time after the Closing Date (i) subdivide or split
the outstanding shares of Common Stock, (ii) combine or reclassify the
outstanding shares of Common Stock into a smaller number of shares or (iii)
issue by reclassification of the shares of Common Stock any shares of capital
stock of the Company, then, and in each such case, the Exercise Price in effect
immediately prior to such event or the record date therefor, whichever is
applicable, shall be proportionately increased or reduced, as applicable, and
the aggregate number of shares for which the Warrant shall be exercisable shall
be proportionately increased or reduced, as applicable, so that the holder of
the Warrant thereafter surrendered for exercise shall be entitled to receive the
number of shares of Common Stock or other securities of the Company which such
holder would have owned or have been entitled to receive after the occurrence of
any of the events described above, had such Warrant been surrendered for
conversion immediately prior to the occurrence of such event or the record date
therefor, whichever is applicable. An adjustment made pursuant to this
subparagraph (a) shall become effective at the close of business on the day upon
which such corporate action becomes effective. Such adjustment shall be made
successively whenever any event listed above shall occur.
(b) Dividends and Distributions in Common Stock. In case the
Company shall at any time or from time to time after the Closing Date pay a
dividend or make a distribution payable in shares of Common Stock on any class
of Capital Stock of the Company other than dividends or distributions of shares
of Common Stock or other securities with respect to which adjustments are
provided in paragraph (a) above, the Exercise Price shall be reduced to the
price determined by multiplying (i) the applicable Exercise Price prior to such
dividend or distribution by (ii) a fraction, the numerator of which shall be the
number of shares of Common Stock theretofore outstanding and the denominator of
which shall be the sum of such number of shares and the total number of shares
issuable in such dividend or distribution. The provisions of this clause shall
similarly apply to successive distributions.
(c) Distribution of Indebtedness, Securities or Assets. In
case the Company shall at any time or from time to time after the Closing Date
distribute to any holders of Common Stock (whether by dividend or in a merger,
amalgamation, consolidation or otherwise) evidences of indebtedness, shares of
Capital Stock of any class or series, other securities, cash or assets (other
than securities referred to in subparagraph (b) above or (f) below or a dividend
payable exclusively in cash and other than as a result of a Fundamental Change)
in respect of such holder's Common Stock, the Exercise Price in effect
immediately prior to the close of business on the record date fixed for
determination of stockholders entitled to receive such distribution shall be
reduced by multiplying such Exercise Price by a fraction, the numerator of which
is the Volume-Weighted Market Value on such record date less the fair market
value (as determined by the Board of Directors of the Company, whose
determination in good faith shall be conclusive) of the portion
12
of such evidences of indebtedness, shares of Capital Stock, other securities,
cash and assets so distributed applicable to one share of Common Stock and the
denominator of which is the Volume-Weighted Market Value. Such adjustment shall
be made successively whenever any such event shall occur.
(d) Fundamental Changes. In case of any Fundamental Change,
the holder of a Warrant outstanding immediately prior to the occurrence of such
Fundamental Change shall have the right upon any subsequent exercise to receive
the kind and amount of stock, other securities, cash and assets that such holder
would have received if such Warrant had been exercised immediately prior
thereto. In any such case, appropriate adjustment shall be made in the
application of the provisions of this Section 5.3 with respect to the rights of
the holders of a Warrant after the Fundamental Change to the end that the
provisions of this Section 5.3 shall be applicable after that event in a manner
as nearly equivalent as practicable as before the Fundamental Change.
(e) Fractional Shares. No fractional shares of Common Stock
shall be issued upon the exercise of the Warrants and, in lieu thereof, any
fractional shares shall be rounded down to the nearest whole share.
(f) Adjustment of Exercise Price Upon Issuance of Additional
Shares of Common Stock.
(i) In the event the Company shall issue Additional
Shares of Common Stock (including Additional Shares of Common Stock deemed to be
issued pursuant to Section 5.3(f)(ii)), without consideration or for a
consideration per share less than the Exercise Price in effect on the date of
and immediately prior to such issue, then, and in each such event, the Exercise
Price will be recalculated in accordance with the following formula: the
Exercise Price then in effect shall be multiplied by a fraction, (x) the
numerator of which shall be (1) the number of shares of Common Stock outstanding
immediately prior to such issuance ("Outstanding Common Stock") plus (2) the
number of shares of Common Stock that the aggregate consideration (determined in
the manner provided in Section 5.3(f)(iii)) received by the Company for such
issuance would purchase at the Exercise Price in effect immediately prior to
such issuance; and (y) the denominator of which shall be (1) the number of
shares of Outstanding Common Stock immediately prior to such issue plus (2) the
number of shares of such Additional Shares of Common Stock so issued. For
purposes of the foregoing calculation, the term "Outstanding Common Stock" shall
include, without limitation, shares of Common Stock issued or issuable upon the
exercise, exchange or conversion of outstanding securities, excluding Common
Stock issuable upon the exercise, exchange or conversion of options, warrants or
similar rights to acquire Common Stock, at a price greater than the then
Volume-Weighted Market Value as of the date of adjustment.
(ii) In the case of the issuance of options to
purchase or rights to subscribe for Common Stock, securities by their terms or
by agreement with the Company convertible into or exchangeable for Common Stock
or options to purchase or rights to subscribe
13
for such convertible or exchangeable securities, the following provisions shall
be taken into account in making the adjustments set forth in paragraph (i)
above:
(A) The shares of Common Stock deliverable
upon exercise of such options to purchase or rights to subscribe for Common
Stock shall be deemed to have been issued at the time such options or rights
were issued and for a consideration equal to the consideration (determined in
the manner provided in Section 5.3(f)(iii)), if any, received by the Company
upon the issuance of such options or rights plus the minimum exercise price
provided in such options or rights (without taking into account potential
antidilution adjustments) for the Common Stock covered thereby.
(B) The aggregate maximum number of shares
of Common Stock deliverable upon conversion of or in exchange (assuming the
satisfaction of any condition to convertibility or exchangeability, including
without limitation, the passage of time, but without taking into account
potential antidilution adjustments, accrual of dividends or payment of any
premiums or preferences conditioned upon the occurrence of specified
transactions) for any such convertible or exchangeable securities or upon the
exercise of options to purchase or rights to subscribe for such convertible or
exchangeable securities and subsequent conversion or exchange thereof shall be
deemed to have been issued at the time such securities were issued or such
options or rights were issued and for a consideration equal to the
consideration, if any, received by the Company for any such securities and
related options or rights (excluding any cash received on account of accrued
interest or accrued dividends), plus the minimum additional consideration, if
any, to be received by the Company (without taking into account potential
antidilution adjustments) upon the conversion or exchange of such securities or
the exercise of any related options or rights (the consideration in each case to
be determined in the manner provided in Section 5.3(f)(iii)).
(iii) In the case of the issuance of Common Stock for
cash, the consideration shall be deemed to be the amount of cash paid therefor
before deducting any reasonable discounts, commissions or other expenses
allowed, paid or incurred by the Company for any underwriting or otherwise in
connection with the issuance and sale thereof. In the case of the issuance of
the Common Stock for a consideration in whole or in part other than cash, the
consideration other than cash shall be deemed to be the fair value thereof as
determined in good faith by the Board of Directors of the Company irrespective
of any accounting treatment.
(iv) Notwithstanding any other provisions of this
Section 5.3(f), no adjustment of the Exercise Price pursuant to this Section
5.3(f) shall have the effect of increasing the Exercise Price above the Exercise
Price in effect immediately prior to such adjustment.
(g) Increase of Number of Shares Upon Adjustment of Exercise
Price. Upon each adjustment of the Exercise Price, the holder of a Warrant shall
thereafter be entitled to purchase, at the Exercise Price resulting from such
adjustment, the number of shares obtained by multiplying the Exercise Price in
effect immediately prior to such adjustment by the number of shares purchasable
pursuant to such Warrant immediately prior to such adjustment and dividing the
product thereof by the Exercise Price resulting from such adjustment.
14
SECTION 5.4 CERTAIN EVENTS.
(a) In the event of (i) any setting by the Company of a record
date with respect to the holders of any class of securities of the Company for
the purpose of determining which of such holders are entitled to dividends or
other distributions, or any right to subscribe for, purchase or otherwise
acquire any shares of Common Stock or any other securities or Property, or to
receive any other right; (ii) any capital reorganization of the Company, or
reclassification or recapitalization of the Common Stock of the Company or any
transfer of all or substantially all of the assets of the Company to, or
consolidation or merger of the Company with or into, any other entity or Person
or (iii) any voluntary dissolution or winding up of the Company; then, and in
each such event, the Company will mail or cause to be mailed to the Investors or
any other Holder of a Warrant at the time (as reflected in the records of the
Company), a notice specifying, as the case may be: (A) the date on which any
such record is to be set for the purpose of such dividend, distribution or
right, and stating the amount and character of such dividend, distribution, or
right; (B) the date as of which the holders of record shall be entitled to vote
on any reorganization, reclassification, recapitalization, transfer,
consolidation, merger, conveyance, dissolution, liquidation, or winding-up or
(C) the date on which any such reorganization, reclassification,
recapitalization, transfer, consolidation, merger, conveyance, dissolution,
liquidation, or winding-up is to take place and the time, if any is to be fixed,
as of which the holders of record of Common Stock (or such other Capital Stock
or securities receivable upon the exercise of the Warrants) shall be entitled to
exchange their shares of Common Stock (or such other Capital Stock or
securities) for securities or other Property deliverable upon such event. Any
such notice shall be given as provided in Section 7.10 of this Agreement, at
least fifteen (15) days prior to the date therein specified and the Holder of
the Warrant may exercise its Warrant within the fifteen (15) day period from the
date of mailing of such notice.
(b) If there shall be any adjustment as provided in Section
5.3, or if securities or Property other than shares of Common Stock of the
Company shall become purchasable in lieu of shares of such Common Stock upon
exercise of the Warrants, the Company shall forthwith cause written notice
thereof to be sent as provided in Section 7.10, to the Investor or any other
Holder of the Warrant at the address of such Person shown on the books of the
Company, which notice shall be accompanied by a certificate of the chief
financial officer of the Company setting forth in reasonable detail the basis
for the Investors or any other Holder becoming entitled to purchase such shares
and the number of shares that may be purchased and the Exercise Price thereof,
or the facts requiring any such adjustment and the Exercise Price and number of
shares purchasable after such adjustment, or the kind and amount of any such
securities or Property so purchasable upon the exercise of the Warrants, as the
case may be. At the request of either Investor or any other Holder and upon
surrender of the Warrants, the Company shall reissue the Warrants in a form
conforming to such adjustments.
15
ARTICLE VI. CLOSING DELIVERIES
SECTION 6.1 COMPANY CLOSING DELIVERIES. On the Closing Date, the
Company shall deliver and/or satisfy, as the case may be, the following items:
(a) Resolutions. A copy of resolutions approving this
Agreement, the Investor Rights Agreement and authorizing the transactions
contemplated hereby, duly adopted by the Board of Directors of the Company,
accompanied by a certificate of the secretary or assistant secretary of the
Company, dated as of the Closing Date, certifying that such copy is a true and
correct copy of resolutions duly adopted at a meeting of, or by unanimous
written consent of, the Board of Directors of the Company and that such
resolutions have not been amended, modified or revoked in any respect, and are
in full force and effect as of the Closing Date.
(b) Consents. Copies of all material consents or waivers
necessary for the execution, delivery and performance by the Company of this
Agreement, in a form reasonably satisfactory to the Investor.
(c) Regulatory Approvals. Evidence satisfactory to the
Investor that all filings, consents or approvals with or of Governmental
Authorities necessary to consummate the transactions contemplated by this
Agreement have been made and obtained, if any.
(d) Compliance with Laws. As of the Closing Date, the Company
shall have complied with all Governmental Requirements necessary to consummate
the transactions contemplated by this Agreement.
(e) No Prohibitions. No Governmental Requirement shall
prohibit the consummation of the transactions contemplated by this Agreement or
any of the Investor Rights Agreement and no order, judgment or decree of any
Governmental Authority or arbitrator shall, and no litigation or other
proceeding shall be pending or threatened which would, enjoin, prohibit,
restrain or otherwise adversely affect in any material manner the consummation
of the transactions contemplated by this Agreement or otherwise have a Material
Adverse Effect..
(f) The Warrants. The Company shall have executed and
delivered to the Investor the Warrants.
(g) Securities Purchase Agreement. The Company shall have
executed and delivered to the applicable parties the Securities Purchase
Agreement and all ancillary documents related thereto.
(h) Amended Master Lease Agreement. The Company shall have
executed and delivered to GECC the Amended Master Lease Agreement and all
documents, certificates or financial or other statements required in connection
with the Amended Master Lease Agreement.
(i) Investor Rights Agreement. The Company shall have executed
and delivered to GECC the Investor Rights Agreement.
16
(j) Opinion of Counsel. Counsel for the Company shall have
delivered to GECC an opinion of counsel, dated as of the Closing Date, in form
and substance acceptable to GECC which opinion may be part of an opinion of
counsel delivered in accordance with the Amended Master Lease Agreement.
(k) Closing Certificate. The Company shall execute and deliver
to the Investor a closing certificate in form and substance satisfactory to the
Investors certifying as to the satisfaction of each of the items set forth in
this Section 6.1 that are required to be satisfied on or before the Closing
Date.
SECTION 6.2 CLOSING DELIVERIES OF THE INVESTOR. The obligation of the
Company to issue the Warrants to the Investor under this Agreement on the
Closing Date is subject to the satisfaction of the following items or execution
and delivery to the Company of the following agreements, documents or
instruments, as the case may be:
(a) Amended Master Lease Agreement. GECC shall have executed
and delivered to the Company the Amended Master Lease Agreement and all
documents, certificates or financial or other statement in connection with the
Amended Master Lease Agreement.
(b) Investor Rights Agreement. The Investor shall have
executed and delivered to the Company the Investor Rights Agreement.
ARTICLE VIII. MISCELLANEOUS
SECTION 7.1 MODIFICATION OF AGREEMENT; SALE OF INTEREST.
(a) This Agreement may not be modified, altered or amended,
except by an agreement in writing signed by the Investor and the Company. The
Company may not sell, assign or transfer this Agreement, or any portion hereof,
including, without limitation, any of the Company's rights, titles, interests,
remedies, powers, obligations and/or duties hereunder. The Investor may, subject
to the provisions of Section 7.1(b) below, sell, assign, transfer or otherwise
dispose of, at any time or times hereafter, this Agreement or the Warrants
(including all or part of their rights under the Warrants), or any portion
hereof or thereof, including without limitation, the Investor's rights, title,
interests, remedies, powers, and/or duties hereunder or thereunder, and such
transferee or assignee must agree to be bound by the terms and conditions of
this Agreement.
(c) Anything to the contrary in this Agreement
notwithstanding, if the Investor has assigned any of its rights as permitted
hereunder, the rights of the Investor, including the right to grant any consent
or waiver or to enter into any amendment to this Agreement, may be exercised by
the holders of the majority in interest of the Common Stock issuable under the
Warrants.
17
SECTION 7.2 EXPENSES. The Company will pay the Investor's expenses
(including reasonable attorneys' fees and out-of-pocket expenses) incurred in
connection with the preparation of this Warrant Agreement and the Warrants and
the Closing hereunder.
SECTION 7.3 WAIVER. No delay or failure on the part of any party hereto
in exercising any right, power or privilege under this Agreement shall impair
any such right, power or privilege or be construed as a waiver of any default or
any acquiescence therein. No single or partial exercise of any such right, power
or privilege shall preclude the further exercise of such right, power or
privilege, or the exercise of any other right, power or privilege. No waiver
shall be valid against any party hereto unless made in writing and signed by the
party against whom enforcement of such waiver is sought and then only to the
extent expressly specified therein.
SECTION 7.4 SEVERABILITY. Wherever possible, each provision of this
Agreement shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement shall be prohibited by,
or invalid under, applicable law, such provision shall be ineffective to the
extent of such prohibition or invalidity, without invalidating the remainder of
such provision or the remaining provisions of this Agreement.
SECTION 7.5 PARTIES. Subject to the provisions of Section 7.1, this
Agreement shall be binding upon and inure to the benefit of the successors and
permitted assigns of the Company and the Holders.
SECTION 7.6 NO FIDUCIARY RELATIONSHIP. The Investor has no fiduciary or
other special relationship with the Company, and no term or condition of the
Agreement shall be construed so as to deem the relationship between the Company
and the Investor to be such. No joint venture or partnership is created by this
Agreement among the Company and the Investor.
SECTION 7.7 ENTIRE AGREEMENT. This Agreement, the Warrants, the
Investor Rights Agreement, constitute the entire agreement of the parties with
respect to the Warrants.
SECTION 7.8 EQUITABLE RELIEF. The Company recognizes that, in the event
it fails to perform, observe or discharge any of its obligations or liabilities
under this Agreement, any remedy of law may prove to be inadequate relief to the
Investor; therefore, the Company agrees that the Investor, if the Investor so
requests, shall be entitled to temporary and permanent injunctive relief in any
such case without the necessity of proving actual damages.
SECTION 7.9 GOVERNING LAW; JURISDICTION; WAVIER OF JURY TRIAL. THIS
AGREEMENT SHALL BE GOVERNED BY, CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE
LAWS OF THE STATE OF NEW YORK WITHOUT GIVING EFFECT TO THE CONFLICT OF LAWS
PROVISIONS THEREOF. EACH OF THE PARTIES HEREBY SUBMITS TO PERSONAL JURISDICTION
AND WAIVES ANY OBJECTION AS TO VENUE IN THE COUNTY OF NEW YORK, STATE OF NEW
YORK. SERVICE OF PROCESS ON THE PARTIES IN ANY ACTION ARISING OUT OF OR RELATING
TO THIS AGREEMENT SHALL BE EFFECTIVE IF MAILED TO THE PARTIES IN ACCORDANCE WITH
SECTION 7.10 HEREOF. THE PARTIES HERETO WAIVE ALL RIGHT TO TRIAL
18
BY JURY IN ANY ACTION OR PROCEEDING TO ENFORCE OR DEFEND ANY RIGHTS HEREUNDER.
SECTION 7.10 NOTICES. All notices, requests, consents, approvals or
demands to or upon the respective parties hereto shall be given or made to each
party at the address specified below.
If to the Company:
SAVVIS Communications Corporation
00000 Xxxxx Xxxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Attn: Xx. Xxxxx Xxxxxxxx Xxxxxxxx
Telecopy: (000) 000-0000
Attn: Xxxx Xxxxxxxxxx
Telecopy: (000) 000-0000
With a copy to:
Xxxxx & Xxxxxxx L.L.P.
000 Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxxxxxx X. Xxxxxxxx
Telecopy: (000) 000-0000
If to the Investor:
General Electric Capital Corporation
00 Xxxxxxxxx Xxxxx
Xxxxxxx, Xxxxxxxxxxx 00000
Attn: Xxxxxx Xxxxxx
Telecopy: (000) 000-0000
With a copy to:
Winston & Xxxxxx
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxx X. Xxxxxxxx
Telecopy: (000) 000-0000
Unless otherwise specified herein, all such notices, requests, consents,
approvals and demands given or made in connection with the terms and provisions
of this Agreement shall be in writing and shall be deemed to have been given or
made when personally delivered, or, if mailed, upon the earlier of actual
receipt by the addressee or three (3) days after sent by registered or certified
mail, postage prepaid, or, in the case of overnight courier service (which may
be utilized hereunder),
19
when delivered by the overnight courier company to the respective address
specified above, or, in the case of telecopy or facsimile transmission (which
may be utilized hereunder), within the first business hour (9:00 a.m. to 5:00
p.m., local time for the recipient, on any Business Day) after receipt by the
respective addressee. Any party may change the address or transmission number to
which notices shall be directed hereunder by giving ten (10) days written notice
of such change to the other parties.
SECTION 7.11 SECTION TITLES. The section titles contained in this
Agreement are and shall be without substantive meaning or content of any kind
whatsoever and are not a part of the agreement between the parties hereto.
SECTION 7.12 CONFIDENTIAL TREATMENT. Each party acknowledges that it
has had, and may in the future have, access to confidential information about
the other party and its business operations, including, without limitation, the
other party's books, agreements, records, tax returns, correspondence, officers,
directors, employees, consultants, contractors, clients, customers, vendors,
lessors, licensors, suppliers, Intellectual Property, marketing strategies,
business plans and other financial and operating information relating to its
businesses and assets. Each party agrees that it will (i) keep confidential all
such information, (ii) not use such confidential information on its own behalf,
except in connection with the transactions contemplated hereby or as
contemplated by the Amended Master Lease Agreement, or on behalf of any other
Person, and (iii) not disclose such confidential information to any third party
(other than to the receiving party's counsel, accountants and other consultants
in connection with the transactions contemplated hereby) or circulate, disclose
or refer to such confidential information publicly without the disclosing
party's advance written authorization; provided, however, that the receiving
party shall have no such obligations with respect to confidential information to
the extent that such information (A) was lawfully obtained by it not subject to
restrictions of confidentiality, (B) is a matter of public knowledge, (C) has
been or is hereafter publicly disclosed other than by or through the receiving
party or (D) is required to be disclosed by the order of any court or
administrative agency or in accordance with applicable law.
Without limiting the generality of the foregoing, each of the parties
hereto agrees that it will not, and the Company will not permit any Subsidiary
to, without the prior written consent of the Company or the Investor, as
applicable, issue or publish a press release, tombstone or other similar
announcement or publication relating to this Agreement or any other related
agreement or the transactions contemplated hereby, unless they or it are
required to do so by the order of any court or administrative agency or in
accordance with applicable law; provided, however, that the disclosing party
will deliver to the Company or the Investor, as applicable, written notice of
any intention or obligation of any disclosing party to deliver or provide a copy
of this Agreement or any other related agreement or any term or provision hereof
or thereof to any Governmental Authority at least ten business days prior to, or
such lesser time as is practicable given the date upon which such Governmental
Authority first requires delivery, the initial date upon which any such delivery
or provision occurs and the disclosing party shall use all reasonable efforts to
redact or delete from such copy or such term or provision such terms or
provisions or language relating to confidential information as may be requested
by the Company or the Investor, as applicable, to be so redacted or deleted
before the same is so delivered or provided.
20
SECTION 7.13 COUNTERPARTS. This Agreement may be executed in a number
of identical counterparts, each of which, for all purposes, is to be deemed an
original, and all of which collectively constitute one agreement, but in making
proof of this Agreement, it shall not be necessary to produce or account for
more than one such counterpart. A facsimile or photocopy of an executed
counterpart of this Agreement shall be sufficient to bind the party or parties
whose signature(s) appear thereon.
SECTION 7.14 FURTHER ASSURANCES. Each party will execute and deliver
such further agreements, documents and instruments and take such further action
as may be reasonably requested by the other party to carry out the provisions
and purposes of this Agreement.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK.]
21
IN WITNESS WHEREOF, the parties hereto have caused this Warrant
Agreement to be duly executed and delivered on their behalf, as of the day and
year first written above.
THE INVESTOR:
GENERAL ELECTRIC CAPITAL CORPORATION
By: /s/ Xxxxxx X. Xxxxxx
Name: Xxxxxx X. Xxxxxx
Title: Vice President
THE COMPANY:
SAVVIS COMMUNICATIONS CORPORATION
By: /s/ Xxxxx X. Xxxxx
Name: Xxxxx X. Xxxxx
Title: Executive Vice President and CFO
[SIGNATURE PAGE TO THE WARRANT AGREEMENT.]
22
SCHEDULE 2.5(B)
---------------
RIGHTS TO ACQUIRE CAPITAL STOCK OF THE COMPANY OR SUBSIDIARIES
1. $20,000,000 aggregate principal amount of the Company's 10% Convertible
Senior Secured Notes due 2006 (the "2006 Notes") and 2006 Notes issued as
payment-in-kind interest thereunder.
2. $37,500,000 aggregate principal amount of the Company's 12% Convertible
Senior Secured Notes due 2005 (the "2005 Notes") and 2005 Notes issued as
payment-in-kind interest thereunder.
3. The Company has committed to issue the Nortel Warrants exercisable into
shares of Common Stock representing 2% of the outstanding Common Stock of the
Company on a fully-diluted basis as of the Closing Date pursuant to the Nortel
Warrant Agreement.
4. The Company intends to grant options to employees to purchase not in excess
of 35 million shares of Common Stock on or about the date of this Agreement.
23
EXHIBIT A
---------
FORM OF WARRANT
24
EXECUTION COPY
EXHIBIT A
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
EITHER THE SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT"), OR APPLICABLE
STATE SECURITIES LAWS (THE "STATE ACTS"), AND SHALL NOT BE SOLD, PLEDGED,
HYPOTHECATED, DONATED OR OTHERWISE TRANSFERRED (WHETHER OR NOT FOR
CONSIDERATION) BY THE HOLDER EXCEPT BY REGISTRATION OR PURSUANT TO AN EXEMPTION
FROM REGISTRATION UPON THE ISSUANCE TO THE COMPANY OF A FAVORABLE OPINION OF
COUNSEL OR OTHER EVIDENCE REASONABLY SATISFACTORY TO THE COMPANY TO THE EFFECT
THAT ANY SUCH TRANSFER SHALL NOT BE A VIOLATION OF THE 1933 ACT AND THE STATE
ACTS.
[ ] SHARES OF COMMON STOCK WARRANT NO. [ ]
WARRANT
TO PURCHASE COMMON STOCK OF
SAVVIS COMMUNICATIONS CORPORATION
1. GRANT OF WARRANT. THIS IS TO CERTIFY THAT General Electric Capital
Corporation, a Delaware corporation ("GECC"), or its registered assigns
(together with GECC, the "Holder"), is entitled to exercise this Warrant to
purchase from SAVVIS Communications Corporation, a Delaware corporation (the
"Company"), up to an aggregate of [________________] shares of common stock, par
value $.01 per share, of the Company ("Common Stock"), subject to adjustment
determined in accordance with ARTICLE V of the Agreement (as defined below), all
on the terms and conditions and pursuant to the provisions hereinafter set
forth. This Warrant is being granted pursuant to the terms of that certain
Warrant Agreement dated March 7,2002 (the "Agreement"), by and between the
Company and the Holder, and the Company and the Holder intend to be legally
bound hereby and thereby. Any capitalized terms used herein but not defined
herein shall have the meanings ascribed to them in the Agreement. The Company
acknowledges that GECC's agreement to enter into the GECC Amended Master Lease
Agreement with the Company is fair and full consideration for the rights granted
to the Holder hereunder, since the Company acknowledges that, due to
restrictions on the exercisability of this Warrant and other restrictions on the
rights of the Holder contained herein and in the Agreement, the value of this
Warrant is contingent, speculative and uncertain.
25
2. EXERCISE PRICE. The purchase price payable for each of the shares of
Common Stock sold upon exercise of this Warrant shall be $0.75 per share (the
"Exercise Price"). Such Exercise Price and the number of shares of Common Stock
into which this Warrant is exercisable are subject to adjustment from time to
time as provided in ARTICLE V of the Agreement.
3. EXERCISE. This Warrant may be exercised in whole or in part at any
time or from time to time after the Closing Date of the Agreement and on or
before the fifth anniversary of the Closing Date of the Agreement (the
"Expiration Date"), unless otherwise extended pursuant to the terms of the
Agreement.
In order to exercise this Warrant, in whole or in part, the Holder
shall deliver to the Company at its principal office at 00000 Xxxxx Xxxx Xxxxx,
Xxxxxxx, Xxxxxxxx 00000, or at such other office as shall be designated by the
Company pursuant to the Agreement:
(a) written notice of the Holder's election to exercise this
Warrant, which notice shall be substantially in the form of the attached
"Subscription Form" and shall specify the number of shares of Common Stock to be
purchased pursuant to such exercise;
(b) either (i) a wire transfer of immediately available funds
to the Company or (ii) notice that the Exercise Price is satisfied by reduction
of the number of shares to be received by the Holder upon exercise of this
Warrant as provided in Section 4 below, with the amount of such reduction
specified in such notice; in each case such wire transfer or reduction in the
number of shares shall be in an amount equal to the aggregate purchase price for
all shares of Common Stock to be purchased pursuant to such exercise; and
(c) this Warrant, properly endorsed.
Upon receipt thereof, the Company shall, as promptly as practicable, and in any
event within ten (10) days thereafter, execute (or cause to be executed) and
deliver to the Holder a certificate or certificates representing the aggregate
number of full shares of Common Stock issuable upon such exercise. The stock
certificate or certificates so delivered shall be registered in the name of the
Holder, or such other name as shall be designated in said notice.
This Warrant shall be deemed to have been exercised and such
certificate or certificates shall be deemed to have been issued, and the Holder
or any other person so designated to be named therein shall be deemed to have
become a Holder of record of such shares for all purposes, as of that said
notice, together with said payment and this Warrant, is received by the Company
as aforesaid (the "Exercise Date"). Except as otherwise provided in the
Agreement, the Holder of this Warrant shall not, by virtue of its ownership of
this Warrant, be entitled to any rights of a stockholder in the Company, either
at law or in equity; provided, however, that the Holder shall, for all purposes,
be deemed to have become the Holder of record of such shares on the Exercise
Date. If the exercise is for less than all of the shares of Common Stock
issuable as provided in this Warrant, the Company shall issue a new Warrant of
like tenor and date for the balance of such
26
shares issuable hereunder to the Holder. The Holder of this Warrant, by its
acceptance hereof, consents to and agrees to be bound by and to comply with all
of the provisions of this Warrant.
4. "CASHLESS" EXERCISE. At the option of the Holder, the Holder may
exercise this Warrant without a cash payment of the Exercise Price, by
designating that the number of the shares of Common Stock issuable to the Holder
upon such exercise shall be reduced by the number of shares having a
Volume-Weighted Market Value (as defined in the Agreement) as of the Exercise
Date equal to the amount of the total Exercise Price for such exercise. In such
instance, no cash or other consideration will be paid by the Holder in
connection with such exercise other than the surrender of the Warrant itself,
and no commission or other remuneration will be paid or given by the Holder or
the Company in connection with such exercise. If such exercise results in only a
partial exercise of this Warrant, then the Company shall deliver to the Holder a
new Warrant evidencing the remaining rights under the Warrant, as provided in
Section 3 above.
5. TAXES. The issuance of any Common Stock or other certificate upon
the exercise of this Warrant shall be made without charge to the registered
Holder hereof, or for any tax in respect of the issuance of such certificate,
unless such tax is imposed by law upon the Holder (including, without
limitation, federal, state or local income taxes), in which case such taxes
shall be paid by the Holder. The obligations of the parties under this Section
shall survive any redemption, repurchase or acquisition of this Warrant or the
Common Stock issued upon exercise of this Warrant by the Company, and any
cancellation or termination of this Warrant.
6. TRANSFER. Except as otherwise provided under the Agreement, this
Warrant and all options and rights hereunder are transferable, as to all or any
part of the number of shares of Common Stock purchasable upon its exercise, by
the Holder hereof in person or by its duly authorized attorney on the books of
the Company upon surrender of this Warrant at the principal offices of the
Company, together with the form of transfer authorization attached hereto duly
executed. The Company shall deem and treat the registered Holder of this Warrant
at any time as the absolute owner hereof for all purposes and shall not be
affected by any notice to the contrary. If this Warrant is transferred in part,
the Company shall at the time of surrender of this Warrant, issue to the
transferee a Warrant covering the number of shares of Common Stock transferred
and to the transferor a Warrant covering the number of shares not transferred.
7. NO FRACTIONAL SHARES. No fractional shares of Common Stock shall be
issued upon the exercise of this Warrant and, in lieu thereof, any fractional
shares shall be rounded down to the nearest whole share.
8. REGISTRATION RIGHTS. The Common Stock into which this Warrant is
exercisable is subject to registration rights as provided in the Investor Rights
Agreement (as defined in the Agreement).
9. RESERVATION OF SHARES. The Company shall, at all times from and
after the Consent Effectiveness Date (as defined in the Agreement) prior to the
Expiration Date, reserve and keep available such number of authorized shares of
its Common Stock, solely for the purpose of
27
effecting the exercise of this Warrant, as may from time to time be issuable
upon the exercise of this Warrant.
10. APPLICABLE LAW. THIS WARRANT SHALL BE GOVERNED BY, CONSTRUED AND
ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT GIVING
EFFECT TO THE CONFLICT OF LAWS PROVISIONS THEREOF. EACH OF THE PARTIES HEREBY
SUBMITS TO PERSONAL JURISDICTION AND WAIVES ANY OBJECTION AS TO VENUE IN THE
COUNTY OF NEW YORK, STATE OF NEW YORK. SERVICE OF PROCESS ON THE PARTIES IN ANY
ACTION ARISING OUT OF OR RELATING TO THIS AGREEMENT SHALL BE EFFECTIVE IF MAILED
TO THE PARTIES IN ACCORDANCE WITH SECTION 7.10 OF THE AGREEMENT. THE PARTIES
HERETO WAIVE ALL RIGHT TO TRIAL BY JURY IN ANY ACTION OR PROCEEDING TO ENFORCE
OR DEFEND ANY RIGHTS HEREUNDER.
11. SUCCESSORS AND ASSIGNS. This Warrant and the rights evidenced
hereby shall inure to the benefit of, and be binding upon, the successors and
assigns of the Holder hereof and shall be enforceable by any such Holder. In the
event this Warrant is sold, transferred or assigned, the transferor will give
written notice to the Company within fifteen (15) days following such sale,
transfer or assignment and in such notice designate the name and address of the
transferee.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK.]
28
IN WITNESS WHEREOF, the Company has caused this Warrant to be duly
executed and issued on its behalf.
DATED as of March __, 2002.
SAVVIS COMMUNICATIONS CORPORATION
By:
-----------------------------
Name:
Title:
[SIGNATURE PAGE TO THE WARRANT.]
29
A. SUBSCRIPTION FORM
(To be executed only upon exercise of Warrant)
The undersigned registered owner of this Warrant irrevocably exercises
this Warrant for and purchases ________ shares of Common Stock of SAVVIS
Communications Corporation purchasable with this Warrant, and herewith makes
payment therefor, all at the price and on the terms and conditions specified in
this Warrant and requests that certificates for the shares of Common Stock
hereby purchased (and any securities or other property issuable upon such
exercise) be issued in the name of and delivered to ____________________________
whose address is ________________________________, and if such shares of Common
Stock shall not include all of the shares of Common Stock issuable as provided
in this Warrant, that a new Warrant of like tenor and date for the balance of
the shares of Common Stock issuable thereunder to be delivered to the
undersigned.
DATED: __________________, _______
By:
---------------------------------
Name:
Title:
Address:
---------------------------
---------------------------
---------------------------
B. ASSIGNMENT FORM
FOR VALUE RECEIVED, the undersigned registered owner of this Warrant
hereby sells, assigns and transfers unto the Assignee named below all of the
rights of the undersigned under this Warrant, with respect to the number of
shares of Common Stock set forth below:
No. of Shares
Name & Address of Assignee Common Stock
-------------------------- ------------
and does hereby irrevocably constitute and appoint as Attorney _________________
to register such transfer on the books of the Company maintained for the
purpose, with full power of substitution in the premises.
DATED: _________________, _____.
By:
---------------------------
Name:
Title:
NOTICE: The signature to this assignment must correspond with the name
as written upon the face of this Warrant in every particular,
without alteration or enlargement or any change whatsoever.
ACKNOWLEDGMENT BY ASSIGNEE
The undersigned Assignee hereby acknowledges receipt of the Warrant
Agreement, and agrees to be bound by its terms.
By:
---------------------------
Name:
Title:
